Navin Fluorine International Ltd
Directors Reports
Your Directors are pleased to present the 25th Annual Report and the
Annual Audited Financial Statements of the Company for the financial year ended March 31,
2023 along with the notes forming part thereof.
1. FINANCIAL AND OPERATIONAL HIGHLIGTS Amount Rs. in crores unless
otherwise stated
| Particulars |
Consolidated |
Standalone |
|
FY 2022-23 |
FY 2021-22 |
FY 2022-23 |
FY 2021-22 |
| Revenue from Operations |
2,077.40 |
1,453.36 |
1,628.14 |
1,403.61 |
| Other income |
35.73 |
39.22 |
41.00 |
37.47 |
| Profit before Depreciation, Finance Costs, |
586.04 |
394.03 |
462.89 |
392.89 |
| Exceptional items and Taxation |
|
|
|
|
| Less: Depreciation and amortization expenses |
62.64 |
47.90 |
42.60 |
44.25 |
| Less: Finance Costs |
27.52 |
1.90 |
2.05 |
1.66 |
| Profit before Taxation |
495.88 |
344.23 |
418.24 |
346.98 |
| Less: Tax Expense |
120.69 |
81.15 |
105.75 |
80.55 |
| Less: Share of (loss) from joint ventures (net) |
0.01 |
0.01 |
- |
- |
| Profit after Taxation |
375.18 |
263.07 |
312.49 |
266.43 |
| Add: Surplus brought forward from the previous year |
1,579.62 |
1,371.39 |
1,603.16 |
1,391.51 |
| Amount available for appropriation |
1,954.80 |
1,634.46 |
1,915.65 |
1,657.94 |
| Appropriation: |
|
|
|
|
| Other Comprehensive Income/(Loss)* |
0.77 |
(0.83) |
0.78 |
(0.78) |
| Payment of dividends |
(54.52) |
(54.48) |
(54.52) |
(54.48) |
| Reversal of excess provision of Dividend Distribution |
- |
0.48 |
- |
0.48 |
| Tax |
|
|
|
|
| Surplus carried to Balance Sheet |
1,901.05 |
1,579.62 |
1,861.91 |
1,603.16 |
*Remeasurement of (loss)/gain (net) on defined benefit plans,
recognized as part of retained earnings. Note: Figures are regrouped wherever necessary to
make the information comparable.
2. DIVIDEND
The Company has declared and paid an Interim Dividend of 5/- per equity
share (i.e. 250% of the face value) during the Financial Year 2022-2023, which was paid in
November 2022. The Board of Directors is pleased to recommend a Final Dividend of 7/- per
equity share (i.e. 350% of the face value) for the Financial Year 2022-2023 which shall be
paid on or after Friday, August 4, 2023 if declared by the Members of the Company at the
forthcoming 25th Annual General Meeting (‘AGM').
The paid Interim Dividend and the recommended Final Dividend are in
accordance with the provisions of the
Companies Act, 2013 (‘the Act') and the Dividend Distribution
Policy of the Company which is available on the Company's website at
https://www.nfil.in/investor/policies/ddp.pdf.
3. YEAR IN RETROSPECT
Your Company has had yet another successful year – consolidated
revenues crossed 2,000 crore demonstrating success of the Company's strategy
supported by disciplined delivery of capital projects and excellence in execution. For the
year ended March 31, 2023, your Company achieved a consolidated revenue from operations of
2,077.40 cr., a growth of 43% as compared to 1,453.36 cr. during the
previous year. Consolidated earnings before interest, tax, depreciation
and amortization (EBITDA), before exceptional items, increased from 394.03 cr. in the
previous year to 586.04 cr. during the year ended March 31, 2023. Consolidated Profit
before Tax (PBT), before exceptional items, was 495.88 cr in the current year as compared
to 344.23 cr. in the previous year.
The Consolidated Operating EBITDA, before Other Income and Exceptional
items, touched 550.31 cr., up from 354.81 cr during the previous year, a growth of 55%.
Operating EBITDA Margin for the year was at 26% against 24% in the previous year. The
Company's strong financial performance reflects the successful execution of its
business strategy and continued focus on high-growth segments. The Company continues to
invest in manufacturing capabilities and expanding its product portfolio to deliver
innovative and value-added solutions to customers.
All business verticals secured strong growth underpinned by the
Company's strategic and innovative initiatives. Strong growth momentum was seen across
businesses. Specialty Chemicals and CDMO (Contract Development and Manufacturing
Organisation), businesses saw 31% & 29% growth respectively over previous year. PP
(igh Performance Products) business witnessed a growth of 64%, mainly, on account of
better price realization and sales of FOs to oneywell International Inc.
CDMO business remains a key growth driver, witnessing a revenue growth
of 29% to reach 448 crores. The growth was driven by a continued demand for custom
manufacturing services, as well as an increase in business from new and existing clients.
It contributed 21% of overall turnover for the year. Strong opening order pipeline
sustained the sales through the year with addition of new customers and projects. The
business's increasing presence in commercial stage molecules secures sustainability of
this business. The Company aims to further strengthen its position in the CDMO space by
expanding its capacities and capabilities. Specialty Chemicals business recorded a
turnover of 743 cr. vis-?-vis 566 cr. in the previous year, showing a robust growth of
31%. It contributed around 36% of the overall turnover. The growth was driven by a mix of
new customers, new products and market share gain. This business witnessed strong new
project flows from life science and crop science segments and optimal utilisation of the
Company's facility. The Business aims to further its product portfolio by introducing
newer and di_erentiated products.
During the year, PP Business recorded sales of 886 cr. compared to 540
cr. in the previous year, contributing around 43% of the overall turnover. Refrigerant
gases business achieved robust growth due to better price realization (both in domestic
and export markets) coupled with growth in non-emissive segment. PP Business remains
focussed on developing eco-friendly refrigerants, which are gaining popularity in the
market. The Business aims to continue investing in this ecofriendly refrigerants space,
ramping up capabilities further. Low growth in Inorganic Fluorides reflects conscious
management decision to optimize available F capacities towards high margin and value added
products. With new capacity envisioned following the execution of the recently announced F
Capex, the business aims to leverage it's position and expand by introducing newer high
margin products and harnessing new opportunities. During the year, PP business commenced
operations of its plant at Dahej that supplies FOs to oneywell which also contributed
significantly to it's growth.
Key raw material costs moved in a mixed trend through the year with
prices of Fluorspar declining over a period of time while Boric Acid went up
significantly. Prices of almost all other critical raw materials increased significantly,
more particularly, sulphur, caustic soda & chloroform were higher by 11%, 31% and 10%
respectively Y-o-Y. On the energy cost front, average power cost was higher than previous
year. Average natural gas price was higher by about 35% in the current fiscal compared to
that of the previous year. The Company's strategy on building a resilient supply
chain continues in action with increasingly diverse sources for key imported raw materials
and securing of majority of other raw materials within close proximity to its sites.
During the year, the Specialty Chemicals business also commenced
operations at Dahej of plants to supply fluorine based agri intermediates. These
investments lay the foundation for the next phase of growth of Specialty Chemical
business. It will help enhance product o_erings and strengthen customer relationships
along with providing building blocks for future growth. Timely capex execution and
delivery of quality product has further strengthened the Company's reputation and
trust with the customers. Further, during the year the Company announced a capital
expenditure of 450/- cr., to manufacture and supply F. When commissioned, the plant will
secure backward integration at Dahej and also cater to the growing market for F driven by
demand growth for fluorochemicals in pharmaceutical, agro-chemical and emerging renewables
sector. In Bhestan, during the year, the Board approved capital expenditure of 80/- cr.
for manufacturing R32 gas. Further, the Company invested significantly for debottlenecking
of cGMP3 at Dewas and for development of the Company's R&D capability at Bhestan.
The investments will help access new business opportunities while enhancing operational
safety and reliability, and securing cost e_ciencies.
During the year, Indian rupee depreciated against all major global
currencies. Rupee depreciation supported higher realizations as the contribution of
exports within the overall sales increased from 52% to 66%. The exchange gain of 3.10
cr. as seen in the financials is on account of timing
di_erence of foreign exchange transactions and their realisation and /
or restatement.
During the year, the Company continued to invest in strengthening
capability across strategic functions like Technology and Development, Research and
Development and Business Development. Improvement in operational e_ciencies, new product
development, working on novel chemistries and developing long-term partnerships continued
to remain a core ingredient of the Company's strategy. Through the year, cross
functional teams continued to work on successful scaleup, improving productivity, quality
and costs of various products to enable businesses gain competitive advantage in the
market.
On a standalone basis, for the year ended March 31, 2023, the Company
achieved total revenue from operations of 1,628.14 cr., Earnings before interest, tax,
depreciation and amortization (EBITDA), before exceptional items of 462.89 cr. and Profit
before Tax (PBT), before exceptional items, of 418.24 cr.
The Company maintained ‘CARE AA' rating, indicating high
degree of safety with respect to timely servicing of financial obligations and very low
credit risk, for borrowings with a tenure of more than one year. The rating for short-term
facilities of tenure less than one year, remains at ‘CARE A1+', indicating very
strong degree of safety with respect to timely servicing of short-term financial
obligations and lowest credit risk.
During the year, the Company continued to enjoy ‘Responsible
Care' accreditation.
The Company remains committed to driving strong financial performance,
investing in R&D pursuing innovation-driven growth, and building long-term value for
all stakeholders. Further details are provided under various other heads of this Report
and in the Management Discussion and Analysis Report annexed to this Report.
4. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
The Company has six subsidiaries and one joint venture: (i) Sulakshana
Securities Limited (SSL), an entity created to settle dues of the term lenders of Mafatlal
Industries Limited, remained a wholly - owned subsidiary of the Company. After settling
all the third-party dues, SSL was left with 1,455 Sq. Meters of commercial floor space at
Mafatlal Centre, Nariman Point, Mumbai and a significant portion of this property has been
leased out on contemporary terms. SSL is utilizing its current cash flows to repay its
debt to the Company. During the year, 5.80 Cr. has been repaid by SSL and its current
outstanding to the Company is 1.69 Cr.
(ii) The Company owns 100% of Manchester Organics Limited (MOL), a
specialized chemicals research company in Runcorn, U.K., holding 51% of the ordinary
voting shares of MOL directly and the balance 49% through NFIL (UK) Limited, a 100%
stepdown subsidiary created for the purpose. During the year, MOL reported turnover of
?4478K and net loss of ?279K.
(iii) NFIL (UK) Limited is a Wholly Owned Subsidiary (WOS) of the
Company which was incorporated in the UK to acquire the balance shareholding of 49% of
MOL. (iv) A step-down subsidiary, NFIL USA Inc. was formed as a Wholly Owned Subsidiary of
NFIL (UK) Limited. The primary objective of formation of this Company was to increase the
market penetration in the USA of the CDMO business and attracting appropriate talent as
and when the business needs expansion.
(v) Navin Fluorine (Shanghai) Co. Ltd. (which is the wholly owned
foreign enterprise under Chinese Laws) was incorporated with a view to have a strategic
presence closer to the source of key raw materials for the Company's specialty and
CDMO business. This presence helps us in taking informed decisions on procurement in terms
of timeliness, availability, quality and cost. These decisions help in optimizing costs,
proper planning and improving margins. The Company's presence in China is also
helping to create strategic partnerships with key vendors.
(vi) Navin Fluorine Advanced Sciences Limited (NFASL) was incorporated
in February 2020. NFASL is a material subsidiary. NFASL commenced commercial operations
during the financial year ended 31st March 2023, achieving total revenue from operations
of 513.86 cr., Earnings before interest, tax, depreciation and amortization (EBITDA),
before exceptional items of 129.26 cr. and Profit before Tax (PBT), before exceptional
items, of 81.51 cr.
During the year assets capitalised in NFASL amounting to 1085 crore
which included capitalisation for plant that supplies FOs to oneywell and our specialty
chemical plants to supply fluorine based agri intermediates. Further, in FY24 we will
incur capital expenditure on F manufacturing plant and commission additional specialty
chemical plant to supply fluorine based agri intermediates.
Capex undertaken in NFASL is funded through mix of debt and equity
contribution. As on March 31, 2023, debt outstanding stood at Rs. 844.08 cr. The said
loans are secured by way of first charge on NFASL's fixed assets, second charge on
its current assets and corporate guarantees given by the Company.
(vii) The Company has subscribed to 25% of the initial equity share
capital of Swarnim Gujarat Fluorspar Private Limited. It is a Joint Venture (JV) with
Gujarat Mineral Development Corporation Limited (GMDCL) and Gujarat Fluorochemicals
Limited (GFL) formed for the purpose of beneficiation of fluorspar ores to be supplied by
GMDCL from its mines. The entire quantity of the finished product viz. acid grade
fluorspar will be bought out by the Company and GFL. This is a feedstock de-risking
initiative for long term fluorspar supply assurance, the most critical raw material of the
Company.
Pursuant to Section 129(3) of the Act, a separate statement containing
salient features of the financial statements of each subsidiary and JV of the Company is
annexed in the format of Form AOC-1 to the Financial Statements of the Company. The
financial statements of all the above-mentioned subsidiaries and JV have been considered
in the Annual Audited Consolidated Financial Results of the Company.
NFASL is a material subsidiary of the Company. Policy for determining
material subsidiary is available at: https://
www.nfil.in/investor/policies/mspf_01042019.pdf. The Annual Financial Statements of all
subsidiary companies are placed on the Company's website at https://www.nfil.
in/investor/annu_reports.html. Copies of the same will be made available to interested
Members who may write to the Company Secretary in this regard.
No company has become or ceased to become subsidiary, associate or JV
of the Company during the year.
5. CAPITAL STRUCTURE OF THE COMPANY
During the year, the Company has allotted an aggregate of 18,020 fully
paid equity shares under Employees' Stock Option Scheme 2007 and Employees'
Stock Option Scheme 2017.
The paid-up share capital of the Company has increased from 9,90,91,745
/- (4,95,38,595 equity shares of face value of 2/- each fully paid and 14,555 equity
shares of 2/- each, 1/- paid-up) to 9,91,33,420 /- (4,95,62,250 equity shares of face
value of 2/- each fully paid and 8,920 equity shares of 2/- each, 1/- paid up) as on March
31, 2023.
Out of 14,555 partly paid equity shares, 5,635 equity shares have been
converted into fully paid equity shares and listed on the Stock Exchanges viz. BSE Limited
and National Stock Exchange of India Limited, and the Company is in process of obtaining
corporate action approval from Depositories for 860 partly paid shares.
6. REPORT ON MANAGEMENT DISCUSSION AND ANALYSIS, AND CORPORATE
GOVERNANCE
As per SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ('SEBI Listing Regulations'), Management Discussion and Analysis Report
and Corporate Governance Report are annexed as ‘Annexure 1' and ‘Annexure
2' respectively to this Report.
7. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
In accordance with SEBI Listing Regulations, the Business
Responsibility and Sustainability Report describing the initiatives taken by the Company
from an environmental, social and governance perspective, in the prescribed form is
annexed as ‘Annexure 3' to this Report.
8. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company firmly believes in giving back to the society and
maintaining healthy and collaborative relationships with the communities in which it
operates. The Company will continue to consistently act as a good corporate citizen and it
sincerely believes in creating a positive impact on communities through contributions via
CSR.
The CSR Policy of the Company is reflective of its CSR philosophy and
highlights the snapshot of activities undertaken by the Company. The scope of the Policy
includes the areas covered under the Policy and activities eligible for CSR contribution.
The other aspects covered by the Policy include guiding principles for: (i) selection of
CSR activities and annual action plan, (ii) execution of CSR activities and (iii)
monitoring CSR activities, along with voluntary impact assessment.
The Company's updated CSR policy is available on the website at:
https://www.nfil.in/investor/policies/NFIL_CSR_ Policy_1.pdf During the year under review,
the Company endeavored to touch the lives of communities in which it operates through
projects in the areas of health, education, sports and animal care, among other equally
important social causes. Pursuant to the provisions of Section 135 of the Act, the Company
was statutorily required to spend 6.14 crores towards CSR during financial year 2022-2023.
The Company has spent 6.15 crores.
The requisite details on CSR initiatives pursuant to Section 135 of the
Act read with the Companies (Corporate Social
Responsibility Policy) Rules, 2014 are annexed as ‘Annexure
4' to this Report.
9. INDUSTRIAL RELATIONS
The engagement with workmen and sta_ remained cordial and harmonious
during the year and the management received full co-operation from employees. The Company
continues to focus on extensive training and developmental activities directed towards
safety, quality and e_ciency. There were no disruptions to the business because of any
Union issues. The total number of employees as on March 31, 2023 was 1,053.
10. INSURANCE
The properties, insurable assets and interests of the Company such as
buildings, plants and machineries, and stocks among others are adequately insured.
11. EMPLOYEES' STOCK OPTION SCEMES
The Company has two Employees' Stock Option Schemes viz.
Employees' Stock Option Scheme 2007 and Employees' Stock Option Scheme 2017.
During the year, 1,55,000 Stock Options were granted and there were no material changes in
the Employees' Stock Option Schemes of the Company. The Schemes are in compliance
with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021. In this
regard, a Certificate from Makarand M. Joshi & Co., the Secretarial Auditors of the
Company, will be placed at the ensuing 25th Annual General Meeting for inspection by
Members.
Relevant details of the Employees' Stock Option Schemes pursuant
to the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are
specified in ‘Annexure 5' to this Report.
12. CANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year, Mr. Basant Kumar Bansal, Chief Financial Officer and
Key Managerial Personnel of the Company, resigned with e_ect from close of business hours
of August 10, 2022 and consequently, Mr. Partha Roychowdhury was appointed as an Interim
Chief Financial Officer and Key Managerial Personnel of the Company with e_ect from August
11, 2022. Further, pursuant to the appointment of Mr. Anish P. Ganatra as Chief Financial
Officer and Key Managerial Personnel with e_ect from February 9, 2023, Mr. Roychowdhury
resigned as Interim Chief Financial Officer and Key Managerial Personnel with e_ect from
close of business hours of February 8, 2023 and he continues as CEO of PP Business of the
Company.
At the 24th Annual General Meeting of the Company held on July 27,
2022, the following Directors were appointed/ re-appointed by the Members of the Company:
• Mr. Mohan M. Nambiar was re-appointed as a Non-Executive
Non-Independent Director of the Company as he had retired by rotation and o_ered himself
for reappointment.
• Ms. Apurva S. Purohit was appointed as an Independent Director
for a term of five (5) consecutive years commencing from October 19, 2021 and ending on
October 18, 2026.
The Board recommends to the Members of the Company the re-appointment
of Mr. Vishad P. Mafatlal, Director of the Company, who retires by rotation at the
forthcoming AGM. and being eligible, has o_ered himself for re-appointment as a Director.
The current term of Mr. Radhesh R. Welling, Managing Director, will end
on December 10, 2023. Pursuant to recommendation of the Nomination and Remuneration
Committee, the Board of Directors of the Company at its Meeting held on May 13, 2023,
re-appointed Mr. Welling as the Managing Director of the Company for five (5) consecutive
years commencing from December 11, 2023 to December 10, 2028 subject to approval of the
Members of the Company. As required under Section 160 of the Act, notices have been
received from Members of the Company proposing the candidature of Mr. Welling as a
Director. The first term of Mr. Atul K. Srivastava as an Independent Director will end on
June 20, 2024 and based on the recommendation of the Nomination and Remuneration
Committee, it is recommended to re-appoint Mr. Srivastava for another five (5) consecutive
years from June 21, 2024 and ending on June 20, 2029. As required under Section 160 of the
Act, notices have been received from Members of the Company proposing the candidature of
Mr. Srivastava as a Director.
Brief profiles of Mr. Mafatlal, Mr. Welling and Mr. Srivastava are
provided in the Notice convening the 25th Annual General Meeting.
13. COMPOSITION OF COMMITTEES
The composition of the Audit Committee is as under:
| Sr. |
Name |
Chairman/Member |
| No. |
|
|
| 1. |
Mr. Sunil S. Lalbhai |
Chairman |
| 2. |
Mr. Pradip N. Kapadia |
Member |
| 3. |
Mr. Mohan M. Nambiar |
Member |
| 4. |
Ms. Radhika V. aribhakti |
Member |
During the year, there were no instances when the recommendations of
the Audit Committee were not accepted by the Board of Directors of the Company. The
details pertaining to the composition of various committees including the Audit Committee,
Stakeholders' Relationship Committee, Nomination and Remuneration Committee,
Corporate Social Responsibility Committee and Risk Management Committee are included in
the Corporate Governance Report, which forms part of this Report.
14. VIGIL MECANISM
In accordance with the requirements of the Act and SEBI Listing
Regulations, the Company has a Whistle Blower Policy approved by the Board of Directors.
The objectives of the policy are: a) To provide a mechanism for
employees and Directors of the Company and other persons dealing with the Company to
report to the Audit Committee, any instances of unethical behavior, actual or suspected
fraud or violation of the Company's Ethics Policy, b) To safeguard the
confidentiality and interest of such employees/Directors/other persons dealing with the
Company against victimization, who notice and report any unethical or improper practices,
and c) To appropriately communicate the existence of such mechanism, within the
organization and to outsiders. Whistle Blower Policy is available on the web-link https://
www.nfil.in/investor/policies/Whistle%20Blower%20Policy. pdf. The Company confirms that no
personnel have been denied access to the Audit Committee pursuant to the whistle blower
mechanism.
15. ANNUAL RETURN
The Annual Return of the Company for the financial year 2022-2023 is
available on the website of the Company at https://www.nfil.in/investor/annu_reports.html.
16. BOARD MEETINGS
During the year, the Board of Directors met eight times. The details of
the Board Meetings are provided in the Corporate Governance Report.
17. DIRECTORS' RESPONSIBILITY STATEMENT
As required under the provisions of Section 134 of the Act, your
Directors report that: (a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation relating to material
departures;
(b) The Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of a_airs of the Company at the end of the
financial year and of the profits of the Company for that period; (c) The Directors have
taken proper and su_cient care for the maintenance of adequate accounting records in
accordance with the provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities; (d) The Directors have
prepared the annual accounts on a going concern basis; (e) The Directors have laid down
internal financial controls (as required by Explanation to Section 134(5)(e) of the Act)
to be followed by the Company and such internal financial controls are adequate and are
operating e_ectively; (f) The Directors have devised proper systems to ensure compliance
with the provisions of all applicable laws and such systems are adequate and operating
e_ectively.
18. DECLARATION BY INDEPENDENT DIRECTORS
Mr. Pradip N. Kapadia, Mr. Sunil S. Lalbhai, Mr. Sudhir G. Mankad, Mr.
arish Rs.. Engineer, Ms. Radhika V. aribhakti, Mr. Atul K. Srivastava, Mr. Ashok U. Sinha,
Mr. Sujal A. Shah and Ms. Apurva S. Purohit are independent in terms of Section 149(6) of
the Act and Regulation 16 of SEBI Listing Regulations. The Company has received requisite
annual declarations/confirmations from all the aforesaid Independent Directors confirming
their independence and compliance with the Code of Conduct for Independent Directors
prescribed under Schedule IV to the Act.
The Board of Directors of the Company is of the view that Independent
Directors fulfill the criteria of independence and they are independent from the
management of the Company. All Independent Directors of the Company have confirmed that
they have registered themselves with Independent Directors' Database of The Indian
Institute of Corporate A_airs (‘IICA') and have cleared the online proficiency
test of IICA, as applicable.
19. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Company has a policy on Appointment and Remuneration of Directors,
Key Managerial Personnel and Other Employees as per Section 178(3) of the Act and
Regulation 19 of SEBI Listing Regulations, which includes:
• Criteria for identification of persons for appointment as
Directors and in senior management positions
• Criteria for determining qualifications, positive attributes,
independence of a Director
• Board Diversity
• Remuneration to Non-Executive Directors, Key Managerial
Personnel and Senior Management and remuneration to other employees The policy on
Appointment and Remuneration of Directors, Key Managerial Personnel and Other Employees is
available at the web-link https://www.nfil.in/investor/policies/ Policyardkmpe.pdf.pdf.
20. LOANS, GUARANTEES AND INVESTMENTS MADE BY TE COMPANY AS PER SECTION
186 OF TE ACT
The details of loans and guarantees given, securities provided and the
investments made by the Company as on March 31, 2023 are provided in the Annual Audited
Financial Statements and its notes.
21. RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during the
financial year were in the ordinary course of the business and on the arm's length
basis.
The Company has not entered into any material contracts or arrangements
or transactions with related parties as per Section 188 of the Act read with the Companies
(Meetings of Board and its Powers) Rules, 2014 and SEBI Listing Regulations. The Company
has nothing to report in Form AOC-2, hence, the same is not annexed.
The Company's Policy on materiality of related party transactions
and on dealing with related party transactions is available on the Company's website
at: https://www.nfil.in/ investor/policies/pmrptrpt.pdf.
22. STATEMENT OF COMPANY'S AFFAIRS
The state of Company's a_airs is given under the heading
"Year in Retrospect" and various other headings in this Report and in the
Management Discussion and Analysis Report which is annexed to this Report.
23. ENERGY CONSERVATION, TECNOLOGY ABSORPTION AND FOREIGN EXCANGE
EARNINGS AND OUTGO
In terms of Section 134 of the Act read with the Companies (Accounts)
Rules, 2014, the information on conservation of energy, technology absorption and foreign
exchange earnings and outgo is disclosed in ‘Annexure 6' to this Report.
24. RISK MANAGEMENT POLICY
The Company has a structured risk management framework and policy that
provides an all-inclusive approach to safeguard the organization from various risks, both
operational and strategic, through adequate and timely actions. It is designed to
anticipate, evaluate and mitigate risks that could materially impact the business
objectives. The potential risks are inventorised and integrated with the management
process such that they receive the necessary consideration during the decision making.
More details are provided in the Management Discussion and Analysis Report and Corporate
Governance Report.
25. ANNUAL PERFORMANCE EVALUATION
Pursuant to the provisions of the Act and SEBI Listing Regulations,
performance evaluation was carried out as under:
Board of Directors
In accordance with the criteria suggested by the Nomination and
Remuneration Committee, the Board of Directors evaluated the performance of the Board,
having regard to various criteria such as Board composition, Board processes and Board
dynamics. The Independent Directors, at their separate meeting, also evaluated the
performance of the Board as a whole based on various criteria. The Board and the
Independent Directors were of the unanimous view that performance of the Board of
Directors as a whole was satisfactory.
Committees of the Board of Directors
The performance of the Audit Committee, the Corporate Social
Responsibility Committee, the Nomination and Remuneration Committee, the
Stakeholders' Relationship Committee and the Risk Management Committee was evaluated
by the Board having regard to various criteria such as committee composition, committee
processes and committee dynamics. The Board was of the unanimous view that all the
committees were performing their functions satisfactorily and according to the mandate
prescribed by the Board under the regulatory requirements including the provisions of the
Act read with the Rules made thereunder and SEBI Listing Regulations.
Individual Directors
(a) Independent Directors: In accordance with the criteria suggested by
the Nomination and Remuneration Committee, the performance of each Independent Director
was evaluated by the entire Board of Directors (excluding the Director being evaluated) on
various parameters like qualification, experience, availability and attendance, integrity,
commitment, governance, independence, communication, preparedness, participation and value
addition. The Board appreciated the contribution made by all the Independent Directors in
guiding the management in achieving higher growth and concluded that continuance of each
Independent Director on the Board will be in the interest of the Company. The Board was
also of the unanimous view that each Independent Director was a reputed professional and
brought his/her rich experience to the deliberations of the Board.
(b) Non-Independent Directors: The performance of each of the
Non-Independent Directors (including the Executive Chairman) was evaluated by the
Independent Directors at their separate meeting. Further, their performance was also
evaluated by the Board of Directors. Various criteria considered for the purpose of
evaluation included qualification, experience, availability and attendance, integrity,
commitment, governance, communication etc. The Independent Directors and the Board were of
the unanimous view that all the Non-Independent Directors were providing good business and
people leadership.
26. PARTICULARS OF EMPLOYEES
The requisite details under Section 197(12) of the Act read with Rule
5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
form part of ‘Annexure 7' to this Report.
The requisite details relating to the remuneration of the specified
employees under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 form part of this Report. Further, this Report and
Financial Statements are being sent to Members excluding the aforesaid annexure. In terms
of Section 136 of the Act, the said annexure will be open for inspection by any Member.
Interested Members may write to the Company Secretary.
27. PREVENTION OF WORKPLACE ARASSMENT
The Company is committed to provide an environment, which is free of
discrimination, intimidation and abuse. The Company has complied with provisions relating
to the constitution of Internal Complaints Committee under the Sexual arassment of Women
at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year, no
complaints were received from employees in this regard.
28. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
As per Section 124 of the Act read with the Rules made thereunder, any
dividend amount transferred to Unpaid Dividend Account which remains unclaimed or unpaid
for 7 years is transferred to IEPF and shares in respect of which dividend has not been
paid or claimed for 7 consecutive years or more are transferred to IEPF.
The details of shares and dividends transferred to IEPF by the Company
during the year are available at: https://www.nfil. in/investor/unpaid.html. The Company
intimates concerned Members and issues public notice in respect of shares to be
transferred to IEPF in the newspaper, on timely basis.
29. INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with
reference to Financial Statements. It has laid down certain guidelines, policies,
processes and structures which are commensurate with the nature, size, complexity of
operations and the business processes followed by the Company. These controls enable and
ensure the systematic and e_cient conduct of the Company's business, protection of
assets, prevention and detection of frauds and errors and the accuracy and completeness of
the accounting and financial records. The controls have been reviewed and found
satisfactory on the following key control matrices: a. Entity level controls b. Financial
controls c. Operational controls The Company has a built-in review and control mechanism
to ensure that such control systems are adequate and operating e_ciently and these are
persistently reviewed for e_ectiveness. The internal control system is maintained by
qualified personnel and there is an internal audit review on a regular basis, to suggest
adequacy and e_ectiveness of the system and to recommend improvements.
30.STATUTORY AUDITORS
At the 24th AGM held on July 27, 2022, the Members of the Company
approved the re-appointment of Price Waterhouse Chartered Accountants LLP (Firm
Registration No. 012754N/N500016) for a second term of 5 consecutive years commencing from
the conclusion of the 24th Annual General Meeting until the conclusion of 29th Annual
General Meeting based on the recommendation of the Audit Committee and the Board.
31. STATUTORY AUDITOR'S REPORT
There is no qualification, reservation or adverse remark or disclaimer
made by the Statutory Auditors in their report on the Financial Statements of the Company
for the financial year ended March 31, 2023.
32. SECRETARIAL AUDIT REPORT
Pursuant to Section 204(1) of the Act and Regulation 24A of SEBI
Listing Regulations, the Secretarial Audit Report of the Company for the financial year
ended March 31, 2023 issued by Makarand M. Joshi & Co., Practicing Company
Secretaries, is annexed as ‘Annexure 8' to this Report. Further, the Secretarial
Audit Report of Navin Fluorine Advanced
Sciences Limited, a Material Wholly Owned Subsidiary, for the financial
year ended March 31, 2023 issued by MMJB & Associated LLP, Practising Company
Secretaries, is annexed as ‘Annexure 9' to this Report. The aforesaid Reports do
not contain any qualification, reservation or adverse remark or disclaimer.
33. COST RECORDS AND COST AUDITORS
Pursuant to Section 148 of the Act read with the Companies (Cost
Records and Audit) Rules, 2014, maintenance of cost records is applicable to the Company
and accordingly, such accounts and records are being maintained.
The Board of Directors, based on the recommendation of the Audit
Committee, appointed B. Desai & Co., (Firm Registration No. 005431), Cost Accountants,
as Cost Auditors to audit the cost accounts of the Company for the financial year
2023-2024 on agreed remuneration of 5,00,000/-. As required under the Act, necessary
resolution seeking Members' ratification for the remuneration payable to B. Desai
& Co. will be placed at the forthcoming Annual General Meeting. The Cost Audit Report
in respect of the financial year 2022-2023 will be filed within the statutory timeline.
34. SECRETARIAL STANDARDS
The Company has complied with the Secretarial Standards on Meetings of
the Board of Directors and General Meetings issued by the Institute of Company Secretaries
of India and approved by the Central Government.
35. STATUTORY DISCLOSURES
a) The Company has not accepted any deposit from the public pursuant to
Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014; b) The
Company has not issued equity shares with di_erential rights as to dividend, voting or
otherwise; c) The Managing Director, Whole Time Director and Key Managerial Personnel of
the Company have not received any remuneration or commission from any of its subsidiaries;
d) No significant and material Orders have been passed by the regulators or courts or
tribunals which impact the going concern status and the Company's operations in
future; e) As there was no buyback of shares during the year, the Company has nothing to
disclose with respect to buyback of shares; f) None of the Auditors of the Company have
reported any fraud as specified under the second proviso of Section 143(12) of the Act; g)
There were no material changes and commitments a_ecting the financial position of the
Company that have occurred between the end of the financial year to which the financial
statements relate and the date of this Report. h) As permitted under the provisions of the
Act, the Board does not propose to transfer any amount to general reserve.
36. APPRECIATION
The Directors wish to place on record their appreciation for the
devoted services of the employees, who have largely contributed to the e_cient management
of your Company. The Directors also place on record their appreciation for the continued
support from the shareholders, customers, suppliers, Governments, bankers, lenders and
other stakeholders.
By order of the Board of Directors For NAVIN FLUORINE INTERNATIONAL
LIMITED
Vishad P. Mafatlal
Chairman DIN: 00011350
Date: May 13, 2023 Place: Mumbai
Registered Office:
Office No. 602, 6th floor, Natraj by Rustomjee, Near Western Express
ighway, 194, Sir Mathuradas Vasanji Road, Andheri (East), Mumbai 400069, India Tel: +91 22
6650 9999; Fax: +91 22 6650 9800 E-mail ID: info@nfil.in; Website: www.nfil.in CIN:
L24110M1998PLC115499