Campus Activewear Ltd
Directors Reports
To
The Members
Campus Activewear Limited
(Formerly known as Campus Activewear Private Limited)
The Board of Directors hereby submits the 14th Board's
Report ("Report") of the business and operations of Campus Activewear Limited
("the Company" or "Campus") together with the Revised Audited
Financial Statements (both Standalone and Consolidated), for the financial year ended 31st
March, 2022.
1. Financial Performance and Highlights
Key highlights of the financial performance of the Company for the
financial year 2021-22 are provided below:
(All amounts are in Rs Millions except otherwise stated)
Particulars |
Standalone* |
Consolidated* |
2021-22 |
2020-21 |
2021-22 |
2020-21 |
Revenue from Operations |
11,941.81 |
7,112.84 |
11,941.81 |
7,112.84 |
Other Income |
23.96 |
37.34 |
23.96 |
37.96 |
EBITDA |
2,443.70 |
1,193.00 |
2,439.22 |
1,198.11 |
Depreciation and amortization expenses |
530.41 |
322.20 |
531.79 |
327.07 |
Profit before tax |
1,717.09 |
699.20 |
1,711.24 |
699.45 |
Less: Tax Expenses |
(631.71) |
(430.46) |
(633.65) |
(430.82) |
Profit for the year (PAT) |
1,085.38 |
268.74 |
1,077.59 |
268.63 |
Other comprehensive income for the year, net of
tax |
5.79 |
7.47 |
6.21 |
10.00 |
Total comprehensive income for the year, net
of tax |
1,091.17 |
276.21 |
1,083.80 |
278.63 |
*the above figures are as per the revised Financial Statements as
approved by the Board of Directors in its meeting held on 23rd September, 2022
The Revised Standalone and Consolidated Financial Statements of the
Company for the financial year ended 31st March, 2022, have been prepared in
accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of
Corporate Affairs and as amended from time to time.
2. State of Company's Affairs
Campus Activewear Limited is engaged in the business of manufacturing
of footwear. During the financial year under report, the Company achieved total income of
H11,965.77 million as compared to H7,150.80 million in the previous year on consolidation
basis. Net profit (after tax) for the year is H1,077.59 million as compared to net profit
(after tax) of H268.63 million in the previous year on consolidation basis.
FY22 Financial Highlights on consolidation basis
FY22 sales volume registered at 19.27 million pairs as against
13.00 million pairs in FY21, thereby generating 48.15% year on year volume growth
FY22 aggregate ASP stood at H620 per pair versus H547 per pair
in FY21, thereby resulting in 13.33% YoY ASP growth
Revenue from operations increased by 67.89% YoY to H11,941.81 mm
in FY22 despite Covid-19 related adverse impact witnessed from April - May 2021 and Jan -
Feb 2022.
FY22 Full year EBITDA stood at H2,439.22 mm as compared to
H1,198.11 mm in FY21, demonstrating 103.59% YoY growth. FY22 EBITDA margin stood at 20.43%
vs. 16.84% in FY21
Net Profit during the year FY22 stood at H1,077.59 mm (PAT
margin: 9.02%) as against PAT of H268.63 mm in FY21 (PAT margin: 3.78%).
Balance Sheet Highlights
The Company's Debtors Turnover ratio improved to 40 days in FY22
from 69 days in FY21 and Inventory turnover ratio improved to 86 days in FY22 from 96 days
in FY21.
The Company's return ratios i.e. ROCE improved from 18.54% in
FY21 to 30.47% in FY22 and similarly ROE is also improved from 8.99% in FY21 to 29.12% in
FY22.
Campus Activewear achieved its highest ever revenue in a financial
year, growing by 67.89% YoY at H11,941.81 mn, despite multiple disruptions caused by the
second wave of COVID-19, Omicron variant scare and a hike in GST rates. The Company
continues to reap benefits from its strategic blend of in-house capability and backward
integration enabling flexibility in design, quality control, cost control and timing to
market. Campus Activewear's design team is well-equipped to identify emerging
international fashion footwear trend and customize it, thereby bringing customer delight
to the Indian market. The Company has launched more than 600 styles in FY22 with different
features such as shock absorption and reflects technology across different price
categories. Campus Activewear's 'Never Out Of Stock' proposition ensures core
replenishment products of the product portfolio focusing on creating a strong base of
bestsellers.
3. Dividend
Pursuant to Regulation 43A of the Securities and Exchange Board of
India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended
("SEBI Listing Regulations"), the Board had approved and adopted a Dividend
Distribution Policy on 10th December, 2021. The policy specifies various
considerations based on which the Board may recommend or declare Dividend, Company's
dividend track record, usage of retained earnings for corporate actions, etc. The Dividend
Distribution Policy is available on the Company's website at www.campusactivewear.com.
The Board does not recommend dividend on the Equity Shares of the
Company for the financial year 2021-22.
4. Reserves and Surplus/ Other Equity
During the financial year 2021-22, the Company has not transferred any
amount to General Reserves. Further, the details of amount transferred to other reserves,
if any, form part of the Revised Standalone and Consolidated Financial Statements provided
as part of this Annual Report.
5. Particulars of Loans, Guarantees or Investments under Section 186 of
the Companies Act, 2013
The Company has not given any loans, guarantees or provided any
security in connection with a loan to any Body Corporate or person as per Section 186 of
the Companies Act, 2013 during the period under report.
6. Management Discussion and Analysis Report
Management Discussion and Analysis Report for the Financial year
2021-22 as stipulated under SEBI Listing Regulations forms as an integral part of this
Annual Report as covered in the head 'Management Discussion and Analysis'
("MDA").
The MDA Report provides a consolidated perspective of economic,
geographical and environmental aspects material to the Company's strategy and its ability
to create and sustain value to its key stakeholders and includes aspects of reporting as
required by Regulation 34 and Schedule V of the SEBI Listing Regulations.
7. Material changes and commitments, affecting the financial position
of the Company which have occurred between the end of the financial year of the Company to
which the financial statements relate and the date of the Report
A. With the approval of shareholders, in the duly convened Extra
Ordinary General Meeting held on 9th November, 2021, an application was filed
to Registrar of Companies, New Delhi and Haryana, for the conversion of the Company from
Private Limited to Public Limited Company and the same was approved by the Registrar of
Companies, Delhi and Haryana dated 22nd November, 2021 and also taken on record
by the Registrar of Companies. Accordingly, the status of Company was changed from Private
Limited to Public Limited with effect from 22nd November, 2021.
In the Extra Ordinary General Meeting held on 9th November,
2021, the sub-division of 1 (one) Equity share having face value of H10/- (rupees ten)
each fully paid up into 2 (two) Equity shares having face value of H5/- (rupees five) each
fully paid was also approved by the shareholders.
Thereafter, the Company has made an Initial Public Offer
("hereinafter referred as IPO") of 4,79,50,000 (four crores seventy nine lakhs
and fifty thousand) Equity Shares of face value of H5/- (rupees five) each of the Company,
at a price of H292/- (rupees two hundred and ninety two) per equity share. IPO opened on
26th April, 2022 and closed on 28th April, 2022 and the Equity
Shares of the Company got listed on BSE Limited ("BSE") and National Stock
Exchange of India Limited ("NSE") (collectively referred as "Stock
Exchanges") with effect from 9th day of May, 2022 pursuant to the IPO of
the Company by way of an Offer for Sale.
Since, the Offer of Equity Shares was only by way of Offer for Sale,
hence Regulation 41 of the SEBI (Issue of Capital and Disclosure Requirements)
Regulations, 2018 is not applicable to the Company.
B. Pursuant to the Campus Activewear Limited Employee Stock Option Plan
2021 (Pre-IPO ESOP Plan of the Company), out of the total 8,54,028 Grants issued (Pre IPO)
to the Eligible Employees under the said Plan, 2,86,338 Options were vested on the 1st
Anniversary from the date of grant and thereafter 2,86,338 equity shares of H5/-
each fully paid up were issued and allotted by the Board of Directors to the employees in
its meeting held on 19th July, 2022 who exercised their rights within the
Exercise period under the said Plan. The summary is as follows:
Plan |
Options Granted |
Options Vested |
Shares Issued and Allotted |
Campus Activewear Limited Employee Stock Option Plan 2021 |
8,54,028 |
2,86,338 |
2,86,338 |
The Company has received In-principle approval for the listing of the
above mentioned Equity shares allotted to the employees from the National Stock Exchange
of India Limited ("NSE") and BSE Limited ("BSE") and have also
received the Trading and Listing approval effective from 1st August, 2022.
Post Allotment, the issued and paid-up Equity Share Capital of the
Company was increased from H1,52,1 6,30,020/- comprising of 30,43,26,004 equity shares of
H5/- each fully paid-up to H1,52,30,61,710/- comprising of 30,46,12,342 equity shares of
H5/- each fully paid up.
C. The Company had filed a Scheme of Arrangement ("Scheme")
under Sections 230 and 232, read with Section 66 and other applicable provisions, of the
Companies Act, 2013, before the Hon'ble National Company Law Tribunal, New Delhi on 25th
March, 2021.
Pursuant to the Scheme, Campus AI Private Limited ("CAIPL"),
wholly-owned Subsidiary of the Company, was proposed to be amalgamated with the Company.
The Scheme was approved by the Board of Directors on 11th November, 2020. The
rationale for the proposed Scheme was to realise the benefits of greater business
synergies and reduced administrative and other costs, since CAIPL and the Company are
engaged in similar business services.
Hon'ble National Company Law Tribunal, New Delhi Bench in its hearing
dated 11th August, 2022, pronounced the order, approving the Scheme. The Scheme
is effective from the appointed date i.e. 1st April, 2020.
The appointed date is the date with effect from which the Scheme shall
be deemed to have become operative and the entire business and undertaking of CAIPL,
together with its assets, rights, benefits, interests, licenses, contracts, investments,
intellectual property, liabilities, transferred employees, funds and obligations, is
proposed to stand transferred to and vested in the Company. Since CAIPL is a wholly- owned
subsidiary of the Company, no new shares will be issued pursuant to the Scheme.
Post approval of the Scheme, the Board of Directors in its meeting held
on 23rd September, 2022 approved the Revised Audited (Standalone and
Consolidated) Financial Statements of the Company for the Financial Year ended 31st
March, 2022, after taking into the effect of the Scheme.
8. Change in the nature of business
There was no change in the nature of business of the Company during the
financial year ended 31st March, 2022.
9. Internal Financial Control Systems and their adequacy
The Company has an adequate system of internal financial controls
commensurate with its size and scale of operations, procedures and policies, ensuring
orderly and efficient conduct of its business, including adherence to the Company's
policies, safeguarding of its assets, prevention and detection of frauds and errors,
accuracy and completeness of accounting records and timely preparation of reliable
financial information.
Internal Audit Reports are discussed in the Audit Committee meetings to
review adequacy and effectiveness of the Company's internal control environment and
necessary action are taken to strengthen the control in the required areas of business
operations. The process is in place to monitor the implementation of audit
recommendations, including those relating to strengthening of the Company's risk
management systems.
Based on the assessment carried out by the Management and the
evaluation of the results of the assessment, the Board of Directors are of the opinion
that the Company has adequate Internal Financial Controls system that is operating
effectively as on 31st March, 2022.
There were no instances of fraud which necessitates reporting of
material misstatement to the Company's operations.
10. Deposits
During the financial year 2021-22, the Company has not accepted any
deposit within the meaning of Section 73 and 74 of the Companies Act, 2013 read together
with the Companies (Acceptance of Deposits) Rules, 2014.
11. Auditors
A) Statutory Auditors
The members of the Company, at their 10th Annual General
Meeting (AGM) held on 24th September, 2018, had appointed M/s. B S R &
Associates, LLP Chartered Accountants (Firm Registration No. 116231W/W-100024) as
Statutory Auditors of the Company to hold office from the conclusion of 10th
AGM till the conclusion of the 15th AGM of the Company.
The Statutory Auditors have confirmed that they satisfy the
independence criteria required under the Companies Act, 2013 and the Code of Ethics issued
by the Institute of Chartered Accountants of India and also confirmed that they are
eligible to continue with their appointment and that they have not been disqualified in
any manner from continuing as Statutory Auditors.
The Reports given by the Statutory Auditors on the Revised Standalone
and Consolidated Financial Statements of the Company for the financial year ended 31st
March, 2022, form part of this Annual Report. There are no observations (including any
qualification, reservation, adverse remark or disclaimer) of the Auditors in the Audit
Report. Further, the notes to accounts referred to in the Auditors' Report are self-
explanatory. The Auditors of the Company have not reported any fraud in terms of the
second proviso to Section 143(12) of the Act.
B) Cost Auditors
The Central Government has not prescribed the maintenance of cost
records under Section 148(1) of the Act and Rules framed thereunder with respect to the
Company's nature of business.
C) Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013
read with corresponding rules made thereunder as amended from time to time. M/s. Pooja
Anand & Associates, Company Secretaries (Firm Registeration Number: P2003DE054000)
were re-appointed as Secretarial Auditors of the Company to conduct Secretarial Audit of
the Company for the financial year ended 31st March, 2022.
The Secretarial Audit Report for the financial year ended 31st
March, 2022 as submitted by Secretarial Auditor in Form MR-3 is annexed to this Report as Annexure
I.
There are no observations (including any qualification, reservation,
adverse remark or disclaimer) of the Secretarial Auditors in their Secretarial Audit
Report that requires to call for any explanation from the Directors.
Secretarial Compliance Report
Secretarial Compliance Report for the financial year ended 31st
March, 2022 on compliance of all applicable SEBI Listing Regulations and
circulars/guidelines issued thereunder, was obtained from M/s Pooja Anand &
Associates, Secretarial Auditors, and submitted to both the stock exchanges. There are no
observations, reservations or qualifications in that report. The Secretarial Compliance
Report for the financial year ended 31st March, 2022 is available on the
website of the Company at www.campusactivewear.com.
D) Internal Auditors
M/s P.C. Bindal & Co., Chartered Accountants, was appointed as the
Internal Auditor of the Company for the Financial year ended 31st March, 2022
and the report given by the Internal Auditor has been reviewed by the Audit Committee from
time to time.
On the recommendation of the Audit Committee, the Board of Directors at
its meeting held on 30th May, 2022 had approved the appointment of Ernst &
Young LLP (EY) as the Internal Auditor of the Company for the financial year ending 31st
March, 2023.
13. Directors and Key Managerial Personnel
(i) Composition
As on 31st March, 2022, the Board consisted of optimum
combination of Executive & Non-Executive Directors including one Woman Independent
Director. Mr. Hari Krishan Agarwal is a Chairman and Managing Director of the Company. The
Board of Directors as on 31st March, 2022 are as follows:
Sl. Name of the Director No. |
Designation |
Category |
1 Mr. Hari Krishan Agarwal |
Chairman and Managing Director |
Executive, Non-Independent |
2 Mr. Nikhil Aggarwal |
Whole-time Director and CEO |
Executive, Non-Independent |
3 Mr. Anil Rai Gupta |
Director |
Non-Executive, Non-Independent |
4 Mr. Ankur Nand Thadani |
Director |
Non-Executive, Non-Independent |
5 Mr. Anil Kumar Chanana |
Director |
Non-Executive, Independent |
6 Mrs. Madhumita Ganguli |
Director |
Non-Executive, Independent |
7 Mr. Jai Kumar Garg |
Director |
Non-Executive, Independent |
8 Mr. Nitin Savara |
Director |
Non-Executive, Independent |
(ii) Changes in Directors
Details of changes in the composition of Board of
Directors of the Company, during the financial year
under review, are as under:
A. Appointment
- Mr. Ankur Nand Thadani (DIN: 03566737) was appointed as the
Non-Executive Non- Independent Director of the Company effective from 24th
September, 2021.
- Mrs. Madhumita Ganguli (DIN: 00676830), Mr. Nirmal Kumar Minda (DIN:
00014942) and Mr. Anil Kumar Chanana (DIN: 00466197) were appointed as the Non-executive
Independent Directors of the Company for the first term of 5 (five) consecutive financial
years by the shareholders of the Company effective from 24th September, 2021.
- Mr. Nitin Savara (DIN: 09398370) was appointed as the Non-Executive
Independent Director, for the first term of 5 (five) consecutive financial years by the
shareholders of the Company effective from 17th November, 2021.
- Mr. Hari Krishan Agarwal (DIN: 00172467) was appointed as the
Chairman and Managing Director of the Company for a term of 3 years effective from 10th
December, 2021 till 1st December, 2024 whose office shall not liable to retire
by rotation, by the shareholders of the Company in its Extra Ordinary General meeting held
on 10th December, 2021.
- Mr. Nikhil Aggarwal (DIN: 01877186) was appointed as the Whole-time
Director and CEO of the Company for a term of 3 years effective from 10th
December, 2021 till 1st December, 2024 whose office shall liable to retire by
rotation, by the shareholders of the Company in its Extra Ordinary General meeting held on
10th December, 2021.
- Mr. Jai Kumar Garg (DIN: 07434619) was appointed as the Non-executive
Independent Director of the Company, for the first term of 5 (five) consecutive financial
years by the shareholders of the Company, effective from 18th December, 2021.
B. Change in designation
The designation and category of Mr. Anil Rai Gupta has been changed
from Nominee Director to Non-Executive Non-Independent Director of the Company with effect
from 14th December 2021.
C. Resignation
- Mrs. Vinod Aggarwal has resigned and ceased to be a Director of the
Company with effect from 24th September, 2021.
- Mr. Puneet Bhatia has resigned as the Non- Executive Director and Mr.
Nirmal Kumar Minda resigned as the Non-Executive Independent Director of the Company, with
effect from 11th December 2021.
The Board of Directors places on record their appreciation for the
immense contributions by all the outgoing Directors in the growth of the Company.
D. Changes in Key Managerial Personnel
During the period under review, Ms. Dimple Mirchandani resigned and
ceased to be a Company Secretary of the Company from closing business hours of 25th
September, 2021 and Ms. Archana Maini was appointed as the General Counsel and Company
Secretary and designated as Key Managerial Personnel of the Company with effect from 26th
September, 2021.
As on 31st March, 2022, Mr. Hari Krishan Agarwal, Chairman
and Managing Director, Mr. Nikhil Aggarwal, Whole-time Director and CEO, Mr. Raman Chawla,
Chief Financial Officer and Ms. Archana Maini, General Counsel and Company Secretary, are
the Key Managerial Personnel of the Company.
Further, Pursuant to the provisions of Section 152 of the Companies
Act, 2013 and other applicable provisions made thereunder, Mr. Nikhil Aggarwal, Director
of the Company, retires by rotation at the ensuing Annual General Meeting and being
eligible, offers himself for re-appointment. On the basis of recommendation by Nomination
and Remuneration committee, the Board recommends his re- appointment.
Brief details of the Director being recommended for re-appointment as
required under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and the Clause 1.2.5 of the Secretarial Standards on
General Meetings (SS-2) have been furnished in the Notice dated 23rd September,
2022 convening the 14th Annual General Meeting.
(iii) Declaration by Independent Director(s)
The Independent Directors have submitted their declaration of
Independence, stating that:
a. they continue to fulfill the criteria of independence as required
pursuant to Section 149(6) read with Schedule IV of the Companies Act, 2013 and Regulation
16 and 25 of the SEBI Listing Regulations 2015; and
b. there has been no change in the circumstances affecting their status
as Independent Director of the Company.
The Independent Directors have also confirmed that they have complied
with the Company's Code of Conduct. In terms of Section 150 of the Act and rules framed
thereunder, the Independent Directors have also confirmed their registration (including
renewal of applicable tenure) and compliance of the online proficiency self-assessment
test (unless exempted) with the Indian Institute of Corporate Affairs (IICA).
The Board opined and confirmed, in terms of Rule 8 of the Companies
(Accounts) Rules, 2014, that the Independent Directors are persons of high repute,
integrity and possess the relevant expertise and experience in their respective fields.
14. Number of meetings of the Board of Directors
The Board met 12 (twelve) times during the Financial Year 2021-22. The
details of which forms part of the Corporate Governance Report, forming part of this
Annual Report.
The intervening gap between the two consecutive Board meetings was
within the prescribed period of 120 days as specified under the provisions of Section 173
of the Companies Act 2013 and SEBI Listing Regulations.
15. Board Committees
The Board had constituted following Committees:-
a. Audit Committee
b. Stakeholder's Relationship Committee
c. Nomination and Remuneration Committee (also designated as
Compensation Committee)
d. Corporate Social Responsibility Committee
e. Initial Public Offer Committee
f. Risk Management Committee
g. Internal Complaints Committee
h. Finance Committee
The composition of the Committees of the Board and the details
regarding meetings of the Committees constituted by the Board are set out in the Corporate
Governance Report, which forms part of this Annual Report.
16. Vigil mechanism/ Whistle Blower Policy
The Company is committed to maintain an ethical workplace that
facilitates the reporting of potential violations of the Company's policies and the
applicable laws. To promote the highest ethical standards, the Company encourages its
employees who have concern(s) about any actual or potential violation of the legal &
regulatory requirements, incorrect or misrepresentation of any financial statements and
reports, etc. any claim of theft or fraud, and any claim of retaliation for providing
information to or otherwise assisting the Audit Committee, to come forward and express
his/her concern(s) without fear of punishment or unfair treatment.
Pursuant to the provisions of Companies Act, 2013 and SEBI Listing
Regulations, the Company has established a robust Vigil Mechanism for Directors and
Employees to report to the management instances of unethical behaviour, actual or
suspected, fraud or violation of the Company's Code of Conduct. The Whistle Blower
Policy/Vigil Mechanism provides that the Company investigates in such incidents, when
reported, in an impartial manner and shall take appropriate action as and when required to
do so.
The Policy also provides the mechanism for employee(s) to raise their
concerns that could have grave impact on the operations, performance, value and the
reputation of the Company and also provide for the direct access to the Chairman of the
Audit Committee in appropriate or exceptional cases. The Whistle Blower Policy/ Vigil
Mechanism Policy is available on the website of the Company at www.campusactivewear.com.
17. Nomination and Remuneration Policy of Directors, Key Managerial
Personnel and other employees of the Company
As per the provisions of Section 178(3) of the Companies Act, 2013, on
the recommendation of the Nomination & Remuneration Committee of the Company, the
Board of Directors had approved a Policy which lays down a framework in relation to
appointment and remuneration of Directors, Key Managerial Personnel and the other
employees and their remuneration.
The Policy broadly lays down the guiding principles, philosophy and the
basis for payment of remuneration to Directors, Key Managerial Personnel and other
employees. The policy also provides the criteria for determining qualifications, positive
attributes and Independence of Director and criteria for appointment of Key Managerial
Personnel / Senior Management while making selection of the candidates. Pursuant to
Section 134(3) of the Companies Act, 2013,the Nomination and Remuneration Policy of the
Company is available on the website of the Company at www.campusactivewear.com.
18. Corporate Social Responsibility (CSR)
In terms of the provisions of Section 135 of the Companies Act 2013,
read with Companies (Corporate Social Responsibility Policy) Rules,2014, and amendment
thereof, the Board has constituted a Corporate Social Responsibility ("CSR")
Committee. The composition of the CSR Committee is provided in the Corporate Governance
Report, which forms part of this Annual Report. The Company discharges its Corporate
Social Responsibility obligations through publicly registered Implementing Agencies
towards supporting projects as prescribed under Schedule VII of the Companies Act, 2013,
in line with the Corporate Social Responsibility Policy of the Company.
The Board of Directors has approved the CSR Policy of the Company as
formulated and recommended by the CSR Committee, which is available on the website of the
Company at www.campusactivewear.com Further, the Annual Report on CSR activities, for the
Financial Year 2021- 22, in the prescribed format, as required under Sections 134 and 135
of the Act read with Rule 8 of the Companies (Corporate Social Responsibility Policy)
Rules, 2014 (as amended) and Rule 9 of the Companies (Accounts) Rules, 2014, is annexed as
Annexure-II to this Report.
19. Particulars of Contracts or Arrangements with Related Parties as
per Section 188 of the Companies Act, 2013
All the transactions entered into with related parties as defined under
the Companies Act, 2013 and SEBI Listing Regulations 2015 during the financial year ended
31st March, 2022 were in the ordinary course of business and on arm's length
basis. As per the provisions of Section 177 of the Companies Act, 2013 and the Rules made
thereunder read with Regulation 23 of Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015, the Company had obtained the
necessary prior approvals of the Audit Committee for all the related party transactions.
Further, there were no Material Related Party Transactions with Promoters, Directors or
Key Management Personnel during the year under review.
None of the transactions with any of the related parties were in
conflict with the interest of the Company rather, they synchronize and synergise with the
Company's operations. The Related Party Transactions are available in Note No. 39 of the
Revised Standalone Financial Statements for the financial year ended 31st
March, 2022.
The Company has framed a Policy on Materiality of Related Party
Transactions and on dealing with Related Party Transactions in accordance with SEBI
Listing Regulations 2015 and Companies Act, 2013 as amended from time to time. The Policy
intends to ensure that proper reporting; approval and disclosure processes are in place
for all transactions between the Company and related parties. The policy is available on
the website of the Company at www.campusactivewear.com and the Details of Related Party
Transactions are annexed as per Form AOC-2 in Annexure-III to this report.
20. Share Capital
Authorized Share Capital
During the FY 2021-22, pursuant to the approval granted by the members
of the Company in its Extra-Ordinary General Meeting ("EGM") held on 9th November,
2021, 1 (one) equity share of the Company with a face value of H10/- (rupees ten) each was
sub- divided into 2 (two) Equity Shares having face value of H5/- (rupees five) each.
Pursuant to the corporate action initiated by the Company in this regard, the sub-division
of equity shares was effective from 23rd November, 2021.
The Authorised Share Capital of the Company, as on 31st
March, 2022 was H4,537,000,000/- divided into 907,400,000 equity shares having face value
of H5/- each after taking into effect the Order passed by the Hon'ble NCLT on 11th
August, 2022 approving the Scheme of Arrangement.
Issued, Subscribed, Paid-up Share Capital
The issued and paid-up share Capital of the Company as on 31st
March, 2022 was H1,521,630,020/- divided into 304,326,004 Equity shares having face value
of H5/- each fully paid-up.
Further, the Board of Directors in its meeting held on 19th
July, 2022, has allotted 2,86,338 equity shares under the Campus Activewear Limited
Employee Stock Option Plan 2021 to the eligible employees of the Company and therefore
post allotment the issued and paid-up equity share capital of the Company was increased
from H1,521,630,020/- divided into 304,326,004 equity shares having face value of H5/-
each fully paid-up to H1,52,30,61,710/- divided into 30,46,12,342 equity shares having
face value of H5/- each fully paid up.
21. Credit Rating
The Company has not issued any debt instruments or non-convertible
securities. However, in May, 2021, it has received Long Term Issuer Ratings of 'IND A+'
from India Ratings and Research with a Stable outlook. In July, 2022, India Ratings and
Research has revised Company's Outlook to Positive from Stable while affirming the Long-
Term Issuer Rating at 'IND A+.
Whereas in May, 2021 CRISIL rating on the Long-Term Bank Facilities of
the Company was CRISIL A with Positive outlook, which was upgraded in July, 2022, on the
Long Term Bank Facilities to 'CRISIL A+' and Stable outlook and reaffirmed the 'CRISIL A1'
rating on the short-term facility. The credit ratings information is available on the
website of the Company at www.campusactivewear.com.
22. Conservation of Energy, Research and Development, Technology
Absorption, Foreign Exchange Earnings and Outgo
In compliance with the provisions of Section 134(3) (m) of the
Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, a statement
containing information on Conservation of Energy, Research and Development, Technology
Absorption, foreign exchange earnings and outgo of the Company, in the prescribed format
is annexed as Annexure-IV.
23. Annual Return
The Annual Return of the Company as on 31st March, 2022 in
Form MGT-7 in accordance with Section 92(3) and Section 134(3)(9) of the Companies Act,
2013 as amended from time to time and the Companies (Management and Administration Rules)
2014, is available at the website of the Company and can be accessed at
https://www.campusactivewear.com/sites/default/files/2022-10/MGT-7%?0FINAI%?0WEBSITE.pdf.
24. Significant/material orders passed by the regulators
During the year under report, the Company has not received any
significant/material orders passed by the Regulators or Courts or Tribunals impacting the
going concern status of the Company and its operations in future except the Order passed
by Hon'ble National Company I aw Tribunal approving the Scheme of Arrangement. The details
regarding the said order are mentioned under the head of 'Material changes occurred after
the closure of the Financial year till the date of this Report' of this Report.
25. Particulars of remuneration of Directors/ KMP/Employees
The information required to be disclosed in the Director's Report
pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is set out in
Annexure-V to this Report.
26. Corporate Governance Report
The Company is committed to maintain the highest standards of Corporate
Governance and adhere to the Corporate Governance requirements set out by Securities and
Exchange Board of India. The Report on Corporate Governance as stipulated under the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 forms an integral part of this Annual Report. The requisite Certificate
from M/s. Pooja Anand and Associates, Company Secretaries confirming compliance of
conditions of Corporate Governance is also annexed to the Corporate Governance Report.
27. Directors' Responsibility Statement
Pursuant to Section 134(3) (c) and 134(5) of the Companies Act, 2013,
the Directors confirm that:
a. in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to material departures;
b. the Directors had 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 affairs of the Company at the end of the
financial year and of the profit and loss of the Company for that period;
c. the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d. the Directors had prepared the annual accounts on a going concern
basis;
e. the Directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and were
operating effectively; and
f. the Directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were adequate and operating
effectively.
28. Risk Management Framework
Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of SEBI
Listing Regulations, the Company has formulated and adopted the Risk Management Framework.
A robust risk management framework is framed to anticipate, identify, measure, manage,
mitigate, monitor and report the risk and uncertainties that may have an impact to achieve
the business objective of the Company. The Company recognizes these risks which need to be
managed and mitigated to protect the interest of the stakeholders, to achieve business
objectives and enable sustainable growth. The risk management framework is aimed at
effectively mitigating the Company's various business and operational risks, through
strategic actions. The Company believes that managing risks helps in maximizing returns.
An extensive program of internal audits and regular reviews by the
Audit Committee is carried out to ensure compliance with the best practices.
29. Disclosure under the sexual harassment of women at workplace
(Prevention, Prohibition And Redressal) Act, 2013
The Company has always believed in providing a safe and harassment free
workplace for every individual working in the Company premises through various
interventions and practices. The Company always endeavours to create and provide an
environment that is free from discrimination and harassment.
The Company has in place robust policy on prevention, prohibition and
redressal of complaints relating to sexual harassment at workplace which is applicable to
the Company as per the provisions of Sexual Harassment of Women at Workplace (Prevention,
prohibition and Redressal) Act, 2013 ('POSH Act'). The Company has complied with the
provisions relating to the constitution of Internal Complaints Committee under the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
During the financial year under report, the Company has not received
any complaint pertaining to sexual harassment.
30. Subsidiaries/Associates/Joint ventures companies
A. Name of the Companies and Details of their contribution to the
overall performance of the Company
The Company had approved and filed a Scheme of Arrangement between
Campus AI Private Limited ("Transferor Company") and Campus Activewear Private
Limited ("Transferee Company/Company") and their respective shareholders and
creditors, under Sections 230 and 232, read with Section 66 and other applicable
provisions of the Companies Act, 2013, before the Hon'ble National Company Law Tribunal
(NCLT), New Delhi on 25th March, 2021. Post conversion of the Company from
Private Limited to Public Limited Company, the same was intimated to the Hon'ble National
Company Law Tribunal (NCLT), New Delhi.
Thereafter, Hon'ble National Company Law Tribunal, New Delhi Bench
("NCLT") in its hearing dated 11th August 2022, pronounced the order,
approving the Scheme of Arrangement and the same was uploaded on 16th August,
2022 on the website of NCLT.
The Scheme is effective from the appointed Date i.e. 1st
April, 2020. Post Approval of the aforementioned Order, Campus AI Private Limited is
amalgamated with the Company effective from 1st April, 2020.
Therefore, there is no Subsidiary or Associate or Joint Venture Company
of the Company as on 31st March, 2022.
B. Companies which have become or ceased to be its Subsidiaries, Joint
Ventures or Associate Companies during the year
During the financial year 2021-22, M G Udyog Private Limited ceased to
be the subsidiary of the Company effective from 24th September, 2021.
31. Consolidated Financial Statement
The Revised Consolidated Financial Statements of the Company & its
subsidiary companies, for the year ended 31st March, 2022, prepared in
accordance with Accounting Standard (IND AS-110) "Consolidated Financial
Statements" prescribed by the Institute of Chartered Accountants of India, form part
of this Annual Report.
Since as on 31st March, 2022, the Company had no subsidiary,
Associate on Joint Venture Company there is no requirement of statement in Form AOC-I as
per Section 129 of the Companies Act, 2013.
32. Formal Annual Evaluation of the Performance of the Board, its
Committees and of Individual Directors
The Companies Act, 2013 and SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 ("SEBI Listing Regulations") contain provisions
for the evaluation of the performance of:
(i) the Board as a whole,
(ii) the individual Directors (including independent Directors and
Chairperson) and
(iii) various Committees of the Board.
The Board of Directors have carried out an Annual Evaluation of its own
performance, Board Committees and Individual Directors pursuant to requirements of the
provisions of Section 178 of the Companies Act, 2013 and Regulation 17(10) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015. The key objectives of
conducting the Board Evaluation process were to ensure that the Board and various
Committees of the Board have appropriate composition and they have been functioning
collectively to achieve common business goals of the Company. Similarly, the key
objectives of conducting performance evaluation of the Directors through individual
assessment and peer assessment were to ascertain if the Directors actively participate in
the Board / Committee Meetings and contribute to achieve the common business goals of the
Company.
The evaluation was carried out by way of internal assessments done
based on the factors prescribed under the Policy adopted by the Company and the SEBI
prescribed Guidance Note on Board Evaluation. Consequently, the Company is required to
disclose the manner of formal annual evaluation.
Performance evaluation of the Board and Committees
The performance of the Board was evaluated by the Board Members after
considering inputs from all the Directors primarily on:
a) The Board has appropriate expertise and experience to meet the best
interests of the Company.
b) The composition of the Board and its committees is appropriate with
right combination of knowledge, skills and domain expertise to maximize performance in
light of future strategy.
c) The Board has adherence to good corporate governance practices.
d) The Board meets on the regular basis and the frequency of such
meetings is adequate for the Board to undertake its duties in accordance with Statutory
guidelines.
e) Agenda of the meetings are circulated well before the meeting.
f) The Board is abreast with latest developments in the regulatory
environment, industry and the market.
g) The minutes of the meeting are properly recorded, circulated and
approved by all the Directors.
The Board evaluated the performance of the Committees on the following
parameters:
a) The mandate, composition and working procedures of committees is
clearly defined and disclosed.
b) The Committee fulfills its functions as assigned by the Board and
applicable laws.
c) The Meeting Agenda and related background papers are concise and
provide information of appropriate quality and detail.
d) The Committees are given adequate independence to discuss and to
give recommendations to the Board.
e) The minutes of the meetings are clear, accurate, consistent,
completely reviewed in subsequent Board meeting.
Performance Evaluation of Individual Directors
The performance evaluation of the Individual Directors were carried out
by the Board and other Individual Directors without the attendance of the Director being
evaluated, considering aspects such as:
a) The Directors understand governance, regulatory, financial,
fiduciary and ethical requirements of the Board.
b) Director actively and successfully refreshes his/ her knowledge and
skills, up-to-date with the latest developments in areas such as corporate governance
framework, financial reporting and industry and market conditions.
c) Independent Directors are independent from the entity and other
Directors and management and there is no conflict of interest.
d) Independent Directors fulfill the Independence criteria as specified
in the Companies Act, 2013 and SEBI Listing Regulations 2015 and observe their
independence from the management.
Performance Evaluation of Chairman
a) Display of effective leadership qualities and skill;
b) Implementation of observations/ recommendations of Board Members;
c) Constructive relationships and communication with the Board;
d) Ability to bring convergence in case of divergent views and conflict
of interest situation tabled at Board Meetings;
The evaluation brought to notice that the sharing of information with
the Board, its timeliness, the drafting of agenda notes and the content thereof as well as
the drafting of the minutes were found to be satisfactory. Therefore, the outcome of the
performance evaluation for the period under report, was satisfactory and reflects how well
the Directors, Board and committees are carrying their respective activities.
The Independent Directors in its separate meeting held on 10th
August, 2022 without the attendance of non- Independent Directors and members of
management, reviewed -
(a) the performance of Non-independent Directors and the Board of
Directors as a whole;
(b) the performance of the Chairperson of the Company, taking into
account the views of executive Directors and non-executive Directors;
(c) assess the quality, quantity and timeliness of flow of information
between the Company management and the Board of Directors that is necessary for the Board
of Directors to effectively and reasonably perform their duties.
After completion of internal evaluation process, the Board at its
meeting held on 12th August, 2022 also discussed the Performance Evaluation of
the Board, its committees and individual Directors. The Performance Evaluation of the
Independent Directors of the Company was done by the Board, excluding the Independent
Director being evaluated. Further, the Board, excluding the Independent Director being
evaluated, also carried out evaluation of fulfillment of the independence criteria as
specified in the SEBI Listing Regulations by the Independent Directors of the Company and
their independence from the management of the Company. The Board expressed its
satisfaction with the evaluation process and results thereof.
33. Employee's Stock Option Plan
During the period under review, the Company had in place 4 (four)
Employee Benefit Plans (Pre-IPO Schemes/ ESOP Schemes), namely, Campus Activewear Limited
Employee Stock Option Plan 2018 (ESOP 2018), Campus Activewear Limited Employee Stock
Option Plan 2021 (ESOP 2021), Campus Activewear Limited Employee Stock Option Plan 2021 -
Special Grant (Special Grant 2021) and Campus Activewear Limited Employee Stock Option
Plan 2021 - Vision Pool (Vision Pool 2021).
The Company with the objective to promote the culture of employee
ownership and as well as to attract, retain, motivate and incentivize senior and critical
talents, formulated Employee Benefit Plans for the employees and Directors of the Company
and its subsidiary Company. The Company views Employee Stock Options as long term
incentive tools that would enable the employees not only to become co-owners, but also to
create wealth out of such ownership in future.
During the period under report, the Board has approved the amendments
made to the ESOP Plan 2021 in its meeting held on 24th September, 2021 and by
the shareholders in its Annual General Meeting held on 24th September, 2021
pertaining to the acceleration of the Unvested Options granted to the employees under ESOP
2021. The Shareholders had approved in their Extra Ordinary General meeting held on 18th
December 2021 introduction of the ESOP Schemes namely Special Grant 2021 and Vision Pool
2021 for the benefit of the employees of the Company and its subsidiary Company.
The Equity shares of the Company were listed on BSE Limited and
National Stock Exchange of India Limited effective from 9th May, 2022. The
Board has approved the changes which were required as per regulatory requirements under
SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 in ESOP Plan 2021,
Special Grant 2021 and Vision Pool 2021.
The Board of Directors, on the recommendations of the Nomination and
Remuneration Committee has approved the Variation in terms of the Vision Pool 2021, which
is in the best interests of the employees. The matter has been placed in the Notice
convening the 14th AGM of the Company for the approval of the shareholders by
way of special resolution, as per Regulation 6 and 7 of the SEBI (Share Based Employee
Benefits and Sweat Equity) Regulations, 2021.
As per Regulation 12 of the SEBI (Share Based Employee Benefits and
Sweat Equity) Regulations, 2021, the Company has also placed the matter for the
Ratification of the aforementioned Pre-IPO Schemes, for the approval of the shareholders
of the Company in the Notice dated 23rd September, 2022 of the forthcoming 14th
AGM. The Pre-IPO Schemes are in conformity with the SEBI (Share Based Employee Benefits
and Sweat Equity) Regulations, 2021.
The Certificate from M/s. Pooja Anand and Associates, Company
Secretaries, Secretarial Auditors of the Company certifying that the Pre-IPO ESOP Schemes
of the Company are being implemented in accordance with the Securities and Exchange Board
of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 and the
Resolutions passed by the shareholders of the Company, will be available electronically
for inspection by the members during the AGM.
The Disclosures pursuant to SEBI (Share Based Employee Benefits and
Sweat Equity) Regulations, 2021, in respect of Pre-IPO ESOP Schemes as at 31st
March, 2022, is available on the website of the Company and can be accessed at
https://www.campusactivewear.com/sites/default/files/7077-10/ESOP%70Disclosure1.pdf.
34. CEO and CFO Certificate
CEO and CFO Certificate as prescribed under Schedule II Part B of
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 is annexed to the Corporate Governance Report forming part of this
Annual Report.
35. Compliance with Secretarial Standards
The Company has duly followed the applicable Secretarial standards,
relating to Meeting of the Board of Directors (SS-1) and General Meeting (SS-2), issued by
the Institute of Company Secretaries of India (ICSI).
36. Other Disclosures
A. During the financial year 2021-22, the Company has not made any
application and no such proceeding is pending under the Insolvency and Bankruptcy code,
2016.
B. There were no instances where the Company required the valuation for
one time settlement or while taking the loan from the Banks or Financial institutions.
C. The Company has not issued shares with differential voting rights
and sweat equity shares during the year under review.
37. Acknowledgement
The Board of Directors acknowledges the continued co- operation,
assistance and support that the Company has received from various Government Departments,
Banks/ Financial Institutions and Shareholders. The Board also places on record its
appreciation for the sincere services rendered by employees of the Company at all levels
and the support and co-operation extended by the valued business associates and the
continuous patronage of the customers of the Company.
For and on Behalf of the Board |
For Campus Activewear Limited |
(Formerly known as Campus Activewear Private Limited) |
Hari Krishan Agarwal |
Chairman and Managing Director |
DIN:00172467 |
Date: 23rd September, 2022 |
Place: New Delhi |