Dear Members,
The Board of Directors ("Board") of your Company has pleasure in presenting
39th Annual Report on the Company's business and operations together with the
Audited Financial Statements for the Financial Year 2022-23:
1. Company Overview
Incorporated in 1984, Relaxo is the largest footwear manufacturer in India, serving the
nation since four decades, and is today ranked among the top 250 Most Valuable Companies
with its shares listed at BSE Limited (BSE) and National Stock Exchange of India Limited
(NSE).
Relaxo is a Fortune 500 (India) company, synonymous with quality products at a_ordable
prices, manufacturing slippers, sandals and sports & casual shoes at 8 State of the
Art manufacturing facilities at Bahadurgarh (Haryana), Bhiwadi (Rajasthan) and Haridwar
(Uttarakhand).
Your Company's most popular brands Relaxo, Sparx, Flite & Bahamas are a
leader in their space.
Having a pan India distribution footprint, Relaxo also operates 387 strong network of
Exclusive Brand Outlets, with availability on all major e-commerce portals as well.
2. Financial Results
In compliance with the provisions of the Companies Act, 2013 ("Act") and SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing
Regulations"), the Company has prepared its financial statements as per the Indian
Accounting Standards (Ind AS) for the Financial Year 2022-23. The financial highlights of
the Company's operations are as follows:
Particulars |
2022-23 |
2021-22 |
Revenue from Operations |
2782.77 |
2653.27 |
EBITDA |
335.78 |
415.75 |
Other Income |
18.57 |
23.72 |
Less: Finance Costs |
19.24 |
15.33 |
Less: Depreciation and Amortisation Expense |
125.10 |
113.54 |
Profit before Tax |
210.01 |
310.60 |
Less: Tax Expense |
55.54 |
77.92 |
Profit after Tax |
154.47 |
232.68 |
Other Comprehensive Income |
1.96 |
0.31 |
Balance brought forward from Previous year |
66.43 |
45.55 |
Amount available for Appropriation |
222.86 |
278.54 |
Appropriation: |
|
|
Final Dividend |
62.23 |
62.11 |
Transfer to General Reserve |
75.00 |
150.00 |
Balance carried to Balance Sheet |
85.63 |
66.43 |
EPS-Basic (in C) |
6.21 |
9.36 |
EPS-Diluted (in C) |
6.21 |
9.35 |
a) Financial
The key highlights of the Company's financial performance during the Financial Year
2022-23 are given below:
Revenue from operations increased by 4.88% to H2782.77 Crores from H2653.27 Crores in
the last Financial Year.
EBITDA is at H335.78 Crores as compared to H415.75 Crores in last Financial Year.
Net profit is at H154.47 Crores as compared to H232.68 Crores in the last Financial
Year.
Net profit margins is 5.55 %.
Relaxo Exclusive Brand Outlets (EBOs) were at 387 as on March 31, 2023.
Even as the profits of your Company were subdued due to high material prices during
this year, the moderate business growth in second half of FY23 helped mitigate the impact.
The year saw a tumultuous beginning with the Russia- Ukraine conflict turning into a
full blown war. As it accentuated into the year, it not only had catastrophic e_ect on the
warring nations, but it also started wide scale disruptions in supply chain equations
leading to spiraling inflation levels unprecedented in many nations, and India too, was
severely impacted by it. Raw material supplies went haywire, with prices following suit
northwards. Force majeure' price revisions in quick succession led to same stock being
available at multiple price points, stirring trade confidence resulting in an adverse
impact on sales even as the scars caused by Covid 19 were ebbing.
Despite this, in a strategic move, your Company has absorbed a part of input cost to
unburden the consumer, maintaining its brand equity and topline with a marginal impact on
profits in the current year.
All this while, your Company continued to strengthen territorial presence and invest in
brand building and marketing initiatives. As the inflation eased towards the third
quarter, the e_orts starting paying o_ and the long established, resilient infrastructure
placed your Company in a position of advantage over its peers.
Revenue E2782.77 Cr. |
|
Managed a moderate growth despite inflationary |
Growth 4.88% |
|
pressures & subdued business sentiments. |
EBITDA E335.78 Cr. |
|
|
Margin 12.07% |
|
|
|
|
Substantial increase in raw material prices |
|
|
impacted EBITDA & PAT margins |
PAT E154.47 Cr. |
|
|
Margin 5.55% |
|
|
b) Non-Financials
Despite the challenging year, your Company is on track to achieve its long term goal.
Sales & Marketing
With unprecedented inflation and supply chain disruptions marring H1 performance, your
Company also re-aligned its strategies to cope with the new paradigm and continued with
its marketing initiatives with an eye on the future.
Your Company continued to upgrade technological systems to improve e_ciency of front
line salesforce and ease of operations management at distributor end and also aggressively
expand the distribution network with special focus on reaching hitherto uncovered
districts of the country.
During FY23, as a strategic initiative, marketing campaigns across sales channels
wholesale, Exclusive Brand Outlets, exports, modern trade and e-commerce were
aligned to reap synergies in communication.
To maintain top of mind recall leadership for its brands, your Company continued with
its consumer and trade facing initiatives by way of high decibel media campaigns, consumer
contact programs, aggressive branding & merchandising and pan India retailer meets.
To capture the digital eyeballs, your Company maintained an always on' presence
in the online space with engaging brand campaigns during the year. Increasing penetration
of internet and digitization has propelled e-commerce activities to higher levels across
the nation. During the year, your Company has paid special focus on this channel and
worked out strategic measures to optimize performance over leading market places with
minimal impact on traditional o_ine business with resultant growth, encouraging sustained
investments for the future.
Retail
During the year, your Company undertook an extensive in-store branding refresh exercise
and implemented a regimented placement planogram for e_ective product showcasing. With a
view to deliver
IT environment. Your Company has also Implemented managed SOC (Security Operation
Centre) solution to ensure 24x7 monitoring for protection against cyber threats.
Human Resource
During the year, a slew of programs were deployed to augment the capability of your
Company's human resources.
In order to enhance productivity and competency of its sales force, your Company
undertook Sales Capability Programmes for its leadership as well as for the frontline,
upskilling them for the future.
As a strategic measure, a cohort of critical middle management talent has been
identified for leadership roles in near future even as your Company is continually
sourcing fresh talent from premier business schools in order to strengthen the succession
pipeline.
Continuing with the past practice of using long term incentives to retain critical
talent, during the year, your Company launched the 4th (fourth) phase of RFL
ESOP Plan 2014 covering 100 eligible employees and cancelled the ESOP granted under Phase
III of RFL ESOP Plan 2014 as Employees surrendered the ESOP voluntarily.
4. Management Discussion and Analysis Report
Pursuant to Regulation 34(2)(e) of the Listing Regulations, a detailed Management
Discussion and Analysis Report for the Financial Year under review is presented in a
separate section, forming part of the Annual Report.
The state of the a_airs of the business along with the financial and operational
developments has been discussed in detail in the Management Discussion and Analysis
Report.
5. Dividend
In line with the Dividend Distribution Policy of the Company, the Board of your Company
in its meeting held on May 10, 2023 has recommended a final dividend @ 250 % equivalent to
H2.50/- (Rupees Two and Fifty Paisa only) per equity share of H1/- (Rupee One Only) each
for the Financial Year
2022-23 payable to those members whose name appear in the Register of members/list of
beneficiaries as on August 17, 2023 i.e. the cut-o_ date. The total final dividend payout
will amount to H62.23 Crore (Rupees Sixty Two Crore Twenty Three Lacs only). The payment
of final dividend is subject to the approval of members in the Company's ensuing Annual
General Meeting ("AGM").
The Register of Members and Share Transfer Books will remain closed from August 18,
2023 (Friday) to August 23,
2023 (Wednesday) (both days inclusive) for the purpose of payment of final dividend for
the Financial Year 2022-23, if declared at the ensuing AGM.
Pursuant to the Finance Act, 2020 read with the Income-tax Act, 1961, the dividend paid
or distributed by a company shall be taxable in the hands of the shareholders w.e.f. April
1, 2020. Accordingly, in compliance with the said provisions, your Company shall make the
payment of dividend after deduction of tax at source at the prescribed rates. For the
prescribed rates for various categories, the shareholders are requested to refer to the
Finance Act, 2020 and amendments thereto.
6. Dividend Distribution Policy
As per Regulation 43A of the Listing Regulations, top 1000 listed companies are
required to formulate a Dividend Distribution Policy. Accordingly, your Company has
adopted the Dividend Distribution Policy which sets out the parameters and circumstances
to be considered by the Board in determining the distribution of dividend to its
shareholders and / or retaining profits earned by the Company. The said Policy is
available on the website of the Company at the link https://www.relaxofootwear.com/
policies.
7. Transfer to Reserves
We have transferred H75.00 Crore (Rupees Seventy Five
Crore Only) to the general reserve from net profits. An amount of H85.63 Crore (Rupees
Eighty Five Crore Sixty Three lac only) is proposed to be retained in the Statement of
Profit & Loss of the Company.
8. Public Deposits
Your Company has not invited or accepted any deposits within the meaning of Sections 73
and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 (including
any statutory modification(s) or re-enactment(s) thereof for the time being in force),
from public during the year under review. Therefore, no amount of principal or interest
was outstanding, as on the balance sheet closure date.
9. Compliance with Secretarial Standards
During the year under review, the Directors state that applicable Secretarial Standards
issued by the Institute of Company Secretaries of India ("ICSI"), i.e.
Secretarial Standard-1 ("SS-1") and Secretarial Standard-2 ("SS-2"),
relating to Meetings of the Board of Directors' and General Meetings',
respectively, have been duly complied by the Company.
10. Subsidiary/ Joint Venture/ Associate Company
Your Company does not have any subsidiary, joint venture or associate company, during
the Financial Year under review.
11. Changes in Nature of Business
There was no change in the nature of business of the Company during the Financial Year
under review.
12. Share Capital
Authorised Share Capital:
The Authorized share capital of your Company as on March 31, 2023 stood at
H51,00,00,000 (Rupees Fifty One Crores
Only) divided into 51,00,00,000 (Fifty One Crores) Equity Shares of H1/- (Rupee One
Only) each.
Issued, Subscribed and Paid-up Share Capital:
During FY23, the Board of Directors of the Company at its meeting held on March 30,
2023, issued and allotted 12,540 (Twelve Thousand Five Hundred Forty) equity shares of
H1/-
(Rupee One Only) each fully paid up on exercise of stock options by the eligible
employees under the Employee Stock Option Plan, 2014 (RFL ESOP PLAN-2014).
As on March 31, 2023, the issued, subscribed and paid-up share capital of the Company
was H24,89,38,586/-
(Rupees Twenty Four Crores Eighty Nine Lacs Thirty Eight Thousand Five Hundred and
Eighty six Only) consisting of equity shares of face value of H1.00/- each divided into
24,89,38,586 (Twenty Four Crores Eighty Nine Lacs Thirty Eight Thousand Five Hundred and
Eighty six) equity shares of H1/- (Rupee One Only) each.
13. Disclosure Relating to Remuneration of Directors and Key Managerial Personnel (KMP)
Your Company believes that building a diverse and inclusive culture is integral to its
success. A diverse Board will be able to leverage di_erent skills, qualifications,
professional experiences, perspectives and backgrounds, which is necessary for achieving
sustainable and balanced development. The Nomination and Remuneration Committee had
adopted principles for identification of Key Managerial Personnel, Senior Management
including the Executive Directors. Pursuant to Section 134(3) (e) and Section 178(3) of
the Act, the Nomination and Remuneration Policy adopted by the Board also sets out the
criteria for determining qualifications, positive attributes and independence while
evaluating a person for appointment / re-appointment as Director or as KMP with no
discrimination on the grounds of gender, race or ethnicity, nationality or country of
origin, and to also determine the framework for remuneration of Directors, KMP, Senior
Management Personnel and other employees. The detailed Nomination and Remuneration Policy
is available on the website of the Company at the link https://
www.relaxofootwear.com/policies.
14. Particulars of Employees
The information and disclosure required under Section 197(12) of the Act read with Rule
5(1), 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the
time being in force), in respect of Directors and Employees of your Company is set out in Annexure
- A to this report.
15. Directors and Key Managerial Personnel
Pursuant to the Section 152(6) of the Act read with the Articles of Association of the
Company, Mr. Deval Ganguly, Whole Time Director (DIN: 00152585) of the Company will retire
by rotation at the ensuing Annual General Meeting and being eligible, o_ered himself for
re-appointment. The Board has recommended his re-appointment to shareholders.
The members in the 38th AGM held on August 25, 2022 through Video
Conferencing ("VC") / Other Audio Visual Means ("OAVM") have approved
the Appointment of Mr. Kuldip Singh Dhingra (DIN: 00048406) as Non-Executive Independent
Director of the Company for a period of 5 (five) years and appointment of Mr. Gaurav Dua
(DIN:09674786) as Whole Time Director of the Company for a period commencing from July 26,
2022 to September 30, 2023.
As on March 31, 2023, Mr. Ramesh Kumar Dua (DIN
- 00157872), Managing Director, Mr. Mukand Lal Dua (DIN - 00157898), Whole-Time
Director, Mr. Nikhil Dua (DIN-00157919), Whole-Time Director, Mr. Gaurav Dua
(DIN:09674786)- Whole-Time Director, Mr. Deval Ganguly (DIN - 00152585) Whole-Time
Director, Mr. Sushil Batra, Chief Financial O_cer (CFO) and Mr. Ankit Jain, Company
Secretary, are the Key Managerial Personnel (KMP) of your Company.
During the Financial year under review, Mr. Vikas Kumar Tak resigned from the position
of Company Secretary and Compliance O_cer of the Company e_ective December 15, 2022 and
Mr. Ankit Jain was appointed as the Company Secretary and Compliance O_cer of the Company
w.e.f. February 4, 2023.
Additionally, Mr. Pankaj Shrimali (DIN: 00013142), being Non-executive Independent
Director of the Company was designated as Chairperson of the Company with e_ect from April
1, 2022, in compliance with Part E of Schedule II of the Listing Regulations.
Therefore, your Board is maintained with optimum combination of Executive and
Non-Executive/Independent Directors. As on March 31, 2023, the Company has 1 (One)
Managing Director, 4 (Four) Whole Time Directors and 5 (Five) Non-Executive Independent
Directors including 1 (One) Woman Independent Director. The composition of the Board
represents an optimal mix of professionalism, knowledge, experience and expertise in
varied fields enabling it to discharge its responsibilities and provide e_ective
leadership for long term vision with highest standards of governance.
16. Declaration by Independent Directors
The Company has received necessary declarations from all the Independent Directors of
the Company confirming that they meet the criteria of Independence as prescribed under
Section 149(6) of the Act and Regulation 25(8) read with Regulation 16 of Listing
Regulations (as per the amendment in SEBI (Listing Obligations and Disclosure
Requirements) (Third Amendment) Regulations, 2021). The Company has also received from
them declaration of compliance of Rule 6 (1) & (2) of the Companies (Appointment and
Qualifications of Directors) Rules, 2014, regarding online registration with the Indian
Institute of Corporate A_airs ("IICA") at Manesar, for inclusion/ renewal of
name in the databank of Independent Directors. The Independent Directors have also
confirmed that they have complied with the Company's Code of Conduct for Independent
Directors prescribed in Schedule IV of the Act.
17. Statement regarding opinion of the Board with regard to integrity, expertise and
experience (including the proficiency) of the Independent Directors appointed during the
year
With regard to integrity, expertise and experience (including the proficiency) of the
Independent Directors appointed/reappointed during the FY23, the Board of Directors has
taken on record the declarations and confirmations submitted by the Independent Directors
and is of the opinion that all the Independent Directors are persons of integrity and
possess relevant expertise and experience and their continued association as Directors
will be of immense benefit and in the best interest of the Company. With regard to
proficiency of the Independent Directors, ascertained from the online proficiency
self-assessment test conducted by the Institute, as notified under Sub-Section (1) of
Section 150 of the Act, the Board of Directors has taken on record the declarations
submitted by Independent Directors that they are exempt from appearing in the test.
None of the Directors other than Mr. Ramesh Kumar Dua, Managing Director, Mr. Mukand
Lal Dua, Mr. Nikhil Dua and Mr. Gaurav Dua, Whole time Directors of the Company are
related inter-se, in terms of Section 2(77) of the Act including Rules framed there under.
18. Annual Evaluation
In terms of the provisions of section 178 of the Act read with Rules issued thereunder
and Regulation 19 read with Part D of Schedule II of the Listing Regulations, the Board of
Directors in consultation with Nomination and Remuneration Committee, has formulated a
framework recommended by the renowned consultants containing, inter-alia, the criteria for
performance evaluation of the entire Board of the Company, its Committees and individual
directors, for FY23.
During the reporting year, customized questionnaires were circulated to all the Board
members in order to enhance the e_ectiveness of the Evaluation Process. The Board
Evaluation process was carried out to ensure that the Board and various Committees of the
Board have appropriate composition and they have been functioning collectively to achieve
the business goals of the Company. Directors were evaluated on their contribution at
Board/Committee meetings and guidance & support to the management outside
Board/Committee meetings and other parameters as specified by the Nomination and
Remuneration Committee of the Company.
The Board's functioning was evaluated on various aspects, including inter alia degree
of fulfillment of key responsibilities, Board structure and composition, role and
accountability, management oversight, risk management, culture and communication,
frequency and e_ectiveness of meetings.
The Committees of the Board were assessed on the basis of degree of fulfillment of key
responsibilities, adequacy of Committee composition and e_ectiveness of meetings.
The performance evaluation of Independent Directors was carried out by the entire
Board, excluding the Director being evaluated. The performance evaluation of the Chairman
of the Board and the Non-Independent Directors was carried out by the Independent
Directors who also reviewed the performance of the Board as a whole.
The Board of Directors expressed their satisfaction with the evaluation process.
19. Familiarization Programme
In terms of Regulation 25(7) of the Listing Regulations, the Company familiarizes its
Directors about their role and responsibilities at the time of their appointment through a
formal letter of appointment. The format of the letter of appointment/re-appointment is
available on our website at the link
https://www.relaxofootwear.com/terms-conditions-of-independent-director.
Sessions are conducted at the meetings of the Board and its various Committees on the
relevant subjects such as strategy, Company performance, financial performance, internal
financial controls, risk management, plants, retail, products, finance, human resource,
capital expenditure, CSR, Compliances etc. All e_orts are made to keep Independent
Directors aware of major developments taking place in the industry, the Company's business
model and relevant changes in the law governing the Company's business. The details of the
programs/sessions conducted for familiarization of Independent Directors can be accessed
on the Company website at the link www.relaxofootwear. com/other-disclosures.
20. Number of Meetings of the Board
During FY23, the Board of Directors met 5 (five) times on May 11, 2022, July 26, 2022,
November 2, 2022, February 4, 2023 and March 30, 2023, the details of which are provided
in the Report on Corporate Governance, which forms part of the Annual Report. The
intervening period between any two consecutive Board meetings was within the maximum time
gap prescribed under the Act, Regulation 17 of the Listing Regulations and SS-1 issued by
ICSI.
21. Committees of the Board
During the FY23, the Board had 5 (five) Committees, namely:
- Audit Committee;
- Nomination and Remuneration Committee;
- Stakeholders' Relationship Committee;
- Risk Management Committee; and
- CSR & ESG Committee.
All the recommendations made by the Committees of the Board including the Audit
Committee were accepted by the Board. A detailed update on the Board, its composition,
detailed charter including terms and reference of various Board Committees, number of
Board and Committee meetings held during FY23 and attendance of the Directors at each
meeting is provided in the report on Corporate Governance, which forms part of the Annual
Report.
22. Director's Responsibility Statement
Pursuant to Section 134(3)(c) and 134(5) of the Act, the Directors to the best of their
knowledge and belief, confirm that: a) in the preparation of the annual accounts, the
applicable accounting standards had been followed, along with the proper explanation
relating to material departures; b) such accounting policies have been selected and
applied 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 profit of the Company for that period; c) proper and su_cient
care has been taken 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 annual accounts have been prepared on
a going concern basis; e) Internal Financial Controls have been laid down to be followed
by the Company and that such Internal Financial Controls are adequate and were operating
e_ectively; and f) Proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
e_ectively.
23. Statutory Auditors
In terms of the provisions of Section 139 of the Act read with provisions of the
Companies (Audit and Auditors) Rules, 2014 (as amended) M/s Gupta & Dua, Chartered
Accountants, (ICAI Firm Registration No. 003849N) were appointed as the Statutory
Auditors of the Company for a period of 5 (five) years from the conclusion of 38th
AGM till the conclusion of 43rd AGM of the Company.
24. Auditors' Report
The Board has duly examined the Statutory Auditors' Report to the accounts, which is
self-explanatory. The Auditor's Report for FY23 does not contain any qualification,
reservation or adverse remarks. The observation of the Statutory Auditors on the financial
statements have been suitably explained in the Notes to Accounts and do not require any
further clarification.
25. Details in respect of frauds reported by auditors under section 143(12) other than
those which are reportable to the Central Government
During the Financial Year under review, no fraud is reported by the Auditors of the
Company under Section 143(12) of the Act.
26. Maintenance of Cost Records and Cost Audit
The Company does not fall under the category prescribed under sub-section (1) of
Section 148 of the Act and Rules 3 and 4 of the Companies (Cost Records and Audit) Rules,
2014 (as amended from time to time) to whom the requirements of maintenance of Cost
Records and the requirement of Cost Audit is applicable.
27. Internal Auditor
Pursuant to the provisions of Section 138 of the Act, the Company has appointed
Deloitte Touche Tohmatsu India LLP and Sahni Natarajan and Bahl as the Internal Auditors
of the Company for Financial Year 2023-24 in co-sourcing model along with in-house
Internal Auditor.
28. Secretarial Auditor
Pursuant to the provisions of Section 204(1) of the Act read with Rule 9 of Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any
statutory modification(s) or re-enactment(s) thereof for the time being in force) and
Regulation 24A of the Listing Regulations, the Board had appointed M/s Chandrasekaran
Associates to conduct the Secretarial Audit of the Company for the Financial Year 2022-23
as recommended by Audit committee.
The Secretarial Audit Report for the Financial Year 2022-23 is annexed as Annexure-B
which forms part of this report. The Secretarial Audit Report for the Financial Year ended
March 31, 2023 does not contain any qualification, reservation or adverse remarks except
the following:- (i) The Chairman of Audit Committee has not attended the Annual General
Meeting ("AGM") of the Company held on August 25, 2022 due to some business
exigencies as Chairman of Audit Committee had to urgently travel. Accordingly he couldn't
attend this AGM.
(ii) During the period April 01, 2022 to April 21, 2022, the Chairman of the Company
and Nomination and Remuneration Committee ("NRC") was the same Director of the
Company; during the aforesaid period no meeting of Board and NRC have been held.
Accordingly, the Chairman of the Board hasn't attended any meeting of NRC as Chairman of
the Company and did not take any decision in the NRC as Chairman of Company during the
aforesaid period.
(iii) The Company has delayed/non filing of certain forms with Registrar of Companies.
As confirmed by the management of the Company that due to the technical issues on the
portal of Ministry of Corporate A_airs arising on account of transition of V2 to V3, form
CSR-2 could not be filed within prescribed timeline.
(iv) The audio recordings of certain earning calls of the Company have been submitted
by the Company with the stock exchanges within twenty-four hours from the conclusion of
such calls but not before the next trading day from the conclusion of such calls. However
going forward the Company did take care to file the same in all further correspondences
with stock exchange before the next trading day from the conclusion of such call or
twenty-four hours whichever was earlier.
29. Annual Return
Pursuant to Section 134 and Section 92(3) of the Act read with Rule 12 (1) of the
Companies (Management and Administration) Rules, 2014, the annual return as on March 31,
2023 will be available on the website of the Company at the link
https://www.relaxofootwear.com/annual-return.
30. Contracts and Arrangements with Related Parties
During FY23, the Company has entered into various transactions with related parties.
All the Contracts/ arrangements/transactions entered into by the Company with its related
parties during the Financial Year under review were in the ordinary course of the
business, on the arm's length basis and were undertaken in compliance with the applicable
provisions of the Act and the Listing Regulations.
During the Financial Year under review, the Company had not entered into any
contract/arrangement/transaction with related parties which could be considered material
in accordance with the Policy of the Company on materiality of Related Party Transactions
that would have required Shareholders' approval under Regulation 23 of the Listing
Regulations.
The updated Policy on materiality of Related Party Transactions is available on the
website of the Company at the link - https://www.relaxofootwear.com/policies.
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 particulars of the material related party transactions are provided in Form AOC-2
as Annexure-C which forms part of this Report. Further, disclosures as per Ind-AS
24 have been made in note 39 of the financial statements for the year ended March 31,
2023.
31. Particulars of Loans, Guarantees & Investments
In terms of Section 186 of the Act and Rules framed thereunder, details of the Loans
given and Investments made by your Company have been disclosed under note 4 in Financial
Statements for the financial year ended March 31, 2023, which forms part of this Annual
Report. Your Company has not given any guarantee or provided any security during the year
under review.
32. Risk Management
Your company has a Risk Management Policy consistent with the provisions of the Act and
Listing Regulations. Risk management process has been established across the Company and
is designed to identify, assess and frame a response to threats that a_ect the achievement
of its objectives. Further, it is embedded across all the major functions and revolves
around the goals and objectives of the organisation.
The Board of Directors has constituted its Risk Management Committee to assist the
Board in fulfilling its responsibilities relating to evaluation and mitigating various
risks exposures that potentially impact the Company.
The Board advised by the Risk Management Committee, wherever appropriate, regularly
reviews the significant risks and decisions that could have a material impact on the
company. There are no risks which, in the opinion of the Board, threaten the existence of
the Company. However, some of the risks which may pose challenges are set out in the
Management Discussion and Analysis which forms part of this Report.
As per SEBI (LODR) (Second Amendment) Regulations, 2021, the Risk Management Committee
shall meet at least twice in a year. The details pertaining to the composition, meetings
and terms of reference of the Risk Management Committee are included in the Report on
Corporate Governance which forms part of the Annual Report.
33. Corporate Social Responsibility (CSR) and its Committee
Your Company has firm belief and commitment towards the collective development of all
the stakeholders especially people at bottom of the pyramid and consider it as a
prerequisite for the sustainability of the business. Thus, CSR is not just compliance for
the Company but is an opportunity to contribute towards nation building through
well-defined professional approach. In compliance with the provisions prescribed under
Section 135 of the Act, your Company had constituted a CSR & ESG
CommitteeoftheBoard.TheBoardofDirectorslaiddownthe CSR Policy, covering the objectives,
focus areas, governance structure and monitoring & reporting framework among others.
The Policy is available on the website of the Company at the link
https://www.relaxofootwear.com/policies. During the year, your Company initiated Phase III
of the ongoing Parivartan project in co-ordination with Sarva Shiksha Abhiyan,
Uttarakhand, by adopting additional 32 schools of Khanpur and Laksar blocks- District
Haridwar, Uttarakhand.
Currently this project is running in 3 phases, providing support to approx. 7,633
students of 77 schools in Khanpur and Laksar Blocks- District Haridwar, Uttarakhand.
In the reporting period, your Company has completed infrastructure development works in
19 Schools of Phase II & III. Out of total 77 schools, 42 schools have been renovated
under Parivartan Project till now.
Being a multiyear project, your company will be supporting the Government Education
Department to develop Government schools into Model Schools that will have child-friendly
infrastructure, trained & motivated teachers, empowered school management committees
for the benefit of students.
During the year, the Company has continued its work on the long term project undertaken
in FY23, the details of activities are given in Annexure-D to this report.
The details of the composition of the CSR & ESG Committee, CSR policy, CSR
initiatives and activities undertaken during the year are given in the Annual Report on
CSR activities as required under the Companies (Corporate Social Responsibility Policy)
Rules, 2014 and explained in detail in Annexure-D to this report.
The details pertaining to the composition, meetings and terms of reference of the CSR
& ESG Committee are included in the Report on Corporate Governance which forms part of
the Annual Report.
As per requirement under Section 135 of the Act read with relevant Rules made
thereunder, the composition of the CSR & ESG Committee, and CSR Policy and Projects
approved by the Board are available on the website of the Company at
https://www.relaxofootwear.com/policies.
34. Composition of Audit Committee
In compliance with the provisions of Section 177 of the Act and Regulation 18 of the
Listing Regulations, the Board of Directors of the Company had constituted the Audit
Committee. The details pertaining to the composition, meetings and terms of reference of
the Committee are included in the Report on Corporate Governance which forms part of the
Annual Report.
35. Vigil Mechanism
Your Company, as required under Section 177 (9) of the Act and Regulation 22 of the
Listing Regulations, has established Vigil Mechanism/ Whistle Blower Policy for Directors
and employees of the Company. This Policy has been established with a view to provide a
tool to Directors and employees of the Company to report to the management on the genuine
concerns including unethical behavior, actual or suspected fraud or violation of the Code
or the Policy. This Policy outlines the procedures for reporting, handling, investigating
and deciding on the course of action to be taken in case inappropriate conduct is noticed
or suspected. This Policy also provides for adequate safeguards against victimization of
director(s)/employee(s) who avail the mechanism and also provides for direct access to the
Chairman of the Audit Committee in exceptional cases. The Audit Committee is authorized to
oversee the Vigil Mechanism/ Whistle Blower Policy in the Company. During the year under
review, the Company received 1 (One) Complaint from a shareholder of the Company regarding
non-receipt of Discount Coupon, and the same was resolved.
Your Company hereby a_rms that no person of the Company has been denied access to the
Chairman of the Audit Committee.
The Policy is available on the website of the Company at the link
https://www.relaxofootwear.com/policies.
36. Business Responsibility and Sustainability Report
SEBI vide its Notification no. SEBI/LAD-NRO/GN/2021/22 dated 5 May, 2021, has
discontinued the requirement of submitting a business responsibility report after the
Financial Year 2021-22 and thereafter, with e_ect from FY23, the top 1000 listed entities
based on market capitalization shall submit a business responsibility and sustainability
report in the format as specified by the SEBI. In terms of the amended Regulation 34 of
the Listing Regulations, the Business Responsibility and Sustainability Report, describing
the initiatives taken by the Company for environmental, social and governance perspective,
forms part of this Annual Report.
37. Policy on Prevention of Insider Trading
In accordance with SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company
has in place following policies/codes which are revised from time to time according to
applicable laws or as per need:
Code for Prevention of Insider Trading
Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive
Information ("UPSI")
Policy and procedures for inquiry in case of leak of UPSI/ suspected leak of UPSI
All compliances relating to Code of Conduct for Prevention of Insider Trading are being
managed through a web-based portal installed by the Company. The Code, inter alia, lays
down the procedures to be followed by DPs while trading/ dealing in Company's shares and
sharing UPSI. The Code includes the obligations and responsibilities of DPs, obligation to
maintain the digital database, mechanism for prevention of insider trading and handling of
UPSI. The said code is available on the website of the Company at https://
www.relaxofootwear.com/policies.
38. Disclosure Under the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 ("SHWWP Act")
The Company is an equal employment opportunity employer and is committed to provide a
safe and conducive work environment that enables women employees to work without fear of
prejudice, gender bias and sexual harassment. The Company always believes in transparency,
honesty, equality, antiracism and fairness to all including women employees of the
Company. They have right to be treated with dignity and as per the Company's framework.
Harassment of any kind including sexual harassment is forbidden. The Company has
Zero Tolerance' approach towards any act of sexual harassment. Article 21 of the
Constitution, which relates to the right to life and personal liberty, includes the right
to live with dignity, and in the case of women, it means that they must be treated with
due respect, decency and dignity of workplace. As required under the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has a
policy on Prevention of sexual harassment of women at workplace and matters connected
therewith and has also complied with the provisions relating to the Constitution of
Internal Committee (IC).
An Internal Committee (IC) is available at each of Units and O_ces of the Company as
per the provisions of the law. The IC is responsible for redressal of complaints related
to sexual harassment. The Company also conducts sensitization/awareness sessions and
quarterly meetings on a regular basis so as to create a free and fair working environment.
No complaint was received by IC during FY23.
It is our constant endeavour to ensure that we provide harassment free, safe and secure
working environment to all employees specially women.
39. Significant and Material Litigations / Orders
During the Financial Year under review, there were no significant and material orders
passed by the regulators or courts or tribunals impacting the going concern status and
Company's operations in future.
40. Capital Market Ratings
During FY23, ICRA has retained long term rating of the Company at [ICRA] AA (pronounced
as ICRA Double A). The Outlook on the long-term rating has been revised to Stable from
Positive.
Additionally, ICRA has also retained short term rating of the Company at [ICRA] A1+
(pronounced as ICRA A one plus) which is the highest rating for the category.
41. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
The details relating to conservation of energy, technology absorption, foreign exchange
earnings and outgo, as required under Section 134(3) of the Act read with Rule 8 of the
Companies (Accounts) Rules, 2014, is annexed as Annexure-E which forms part of this
Report.
42. Employees Stock Option Plan
Presently, the Company has one Employee Stock Option Plan 2014 ("RFL ESOP
PLAN-2014"/ "ESOP Plan"). This Plan helps to attract and retain talented
employees in the Company and boost their morale. The Nomination and Remuneration Committee
administers and monitors the Company's ESOP Plan.
During FY23, 12,540 (Twelve Thousand Five Hundred Forty) options were exercised by the
employees of the Company. Accordingly, the Company on March 30, 2023 made an allotment of
12,540 (Twelve Thousand Five Hundred Forty) equity shares against the options exercised by
the employees. During the Financial Year under review, the Company has cancelled 4,00,300
(Four Lacs Three Hundred) options due to Resignation/ Retirement as per the Company's ESOP
Plan and cancellation of RFL Phase 3rd of ESOP Scheme 2014 due to surrender of
ESOPs by the employees of the Company on voluntary basis.
During the year the Company rolled out fourth phase of RFL ESOP Plan 2014 and granted
7,71,200 (Seven Lacs Seventy One Thousand Two Hundred) options to 100 employees.
Pursuant to the provisions of SEBI (Share Based Employee Benefits and Sweat Equity)
Regulations, 2021, a disclosure with respect to ESOP Plan of the Company as on March 31,
2023, is available on the website of the Company at the link
https://www.relaxofootwear.com/other-disclosures.
A certificate from M/s. Chandrasekaran Associates, Company Secretaries, Secretarial
Auditor of the Company with respect to the implementation of the Company's ESOP Plan would
be made available to the members at the ensuing AGM. A copy of the same will also be
available for inspection at the registered o_ce of the Company during business hours.
ESOP scheme of the Company is in compliance with SEBI (Share Based Employee Benefits
and Sweat Equity) Regulations, 2021.
The details as per the requirements of ESOP Regulations are annexed as Annexure-F
which forms part of this Report.
43. Material Changes and Commitments
There are no material changes and commitments a_ecting the financial position of the
Company, which have occurred between the end of the Financial Year ended on March 31, 2023
of the Company and as on the date of this Report.
44. Internal Financial Controls
Your company has put in place adequate internal financial controls with reference to
the financial statements commensurate with the size, scale and complexity of our
operations.
Internal Financial Controls ensure orderly and e_cient conduct of the business,
including adherence to company's policies, safeguarding of assets, prevention and
detection of frauds and errors, accuracy and completeness of accounting records, and the
timely preparation of reliable financial information.
Internal Financial Control framework is independently evaluated by external agency
apart from periodic evaluation by in-house Internal Audit function for necessary
improvement, wherever required. Based on the results of such assessments, no reportable
material weakness or significant deficiencies in the design or operation of Internal
Financial Controls was observed.
Further, the Statutory Auditors of the Company also reviewed Internal Financial
Controls over Financial Reporting of the Company as on March 31, 2023 and issued their
report which forms part of the Independent Auditor's report.
The Audit Committee of the Board of Directors actively reviews the adequacy and
e_ectiveness of internal control systems and suggests improvement for strengthening them.
The Company has a strong Management Information System, which is an integral part of the
control mechanism. The Company continues to strengthen its risk management and
internal control capabilities by improving its policies and procedures and introducing
advanced risk management tools.
The Managing Director and CFO Certificate included in the Corporate Governance Report
confirms the existence of e_ective internal control systems and procedures in the Company.
The Audit Committee reviews the e_ectiveness of the Internal Financial Control framework
in the Company.
45. Managing Director and CFO Certification
The Certificate required under Regulation 17(8) of the Listing Regulations, duly signed
by the Managing Director and CFO was placed before the Board. The same is annexed with
Corporate Governance Report which forms part of this Annual Report.
Declaration by Managing Director under Regulation 34(3) read with Schedule V of the
Listing Regulations in respect of compliance with the Company's Code of Conduct is
enclosed with this Annual Report.
46. Transfer of Unclaimed Shares / Dividend
As per the provisions of Regulation 39(4) read with Schedule VI of the Listing
Regulations, the unclaimed shares lying in the possession of the Company, are required to
be dematerialized and transferred into a special demat account held by the Company.
Accordingly, unclaimed shares lying with the Company have been transferred and
dematerialized in an Unclaimed Suspense Account' of the Company. This account is
being held by the Company purely on behalf of the shareholders entitled for these equity
shares.
The summary of Unclaimed Suspense Account' during the year is given hereunder:
Particulars |
No. of Shareholders |
No. of equity shares held |
1 Aggregate number of shareholders and the outstanding shares lying in
the suspense account as on April 1, 2022 |
31 |
82,195 |
2 Number of shares transferred to suspense account during the year |
- |
- |
3 Number of shareholders who approached the company for shares and to
whom shares were transferred from the suspense account during the year |
2 |
10,024 |
4. Transfer of shares to IEPF Account |
- |
- |
5. Aggregate number of shareholders and the outstanding shares lying
in the suspense account as on March 31, 2023 |
29 |
72,171 |
The voting rights on the equity share(s) in the suspense account shall remain frozen
till the rightful owners of such equity share(s) claim the equity share(s). Any corporate
benefits in terms of securities accruing on such equity shares viz. bonus shares, split
etc., shall also be credited to such demat suspense account or unclaimed suspense account,
as applicable in accordance with existing provisions.
In compliance with the statutory provisions, during the Financial Year under review,
the Company transferred unclaimed dividend amounting to H1,84,906/- (Rupees One
Lac Eighty Four Thousand Nine Hundred and Six Only) from the Final Dividend for the
Financial Year 2014-15 to the Investor's Education and Protection Fund ("IEPF").
The Company has also uploaded the details of unpaid and unclaimed amounts lying with the
Company as on August 25, 2022 (date of last AGM) on the website of the Company at the link
https://www.relaxofootwear.com/unpaid-dividend-data.
Pursuant to the provisions of Section 124 and 125 of the Act read with the Investor
Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules,
2016, as amended, during FY23, the Company transferred 6,110 (Six Thousand One Hundred and
Ten) equity shares to demat account with IEPF for which dividend was unpaid/ unclaimed for
seven consecutive years.
The shareholders whose unpaid dividend/shares are transferred to the IEPF can request
the Company/Registrar and Transfer Agent as per the applicable provisions in the
prescribed form, IEPF-5, for claiming the unpaid dividend/ shares from IEPF. The process
and online application form (Form IEPF 5) as prescribed by the Ministry for
claiming back the shares/dividends are available on the website of MCA at www.iepf.gov.in
. Mr. Ankit Jain, Company Secretary
& Compliance O_cer acts as the Nodal O_cer of the Company as per the provisions of
IEPF. The contact details of Nodal O_cer is available on the website of the Company at the
link https://www.relaxofootwear.com/investor-support.
47. Corporate Governance
The Company is committed to maintain the highest standard of Corporate Governance and
adhere to the Corporate Governance requirements set out by SEBI. A detailed report on
Corporate Governance, pursuant to the requirements of Regulation 34 of the Listing
Regulations, forms part of the Annual Report. A certificate from M/s Gupta & Dua,
Chartered Accountants, (ICAI Firm Registration No. 003849N) Statutory Auditors of
the Company, confirming the compliance of the Company with the conditions of Corporate
Governance, as stipulated under the Listing Regulations, is attached to the Report of
Corporate Governance as Annexure-G.
48. Details of Non-Compliance with regard to Capital Markets During the Last Three
Years
There have been no instances of non-compliances by the Company with regard to Capital
Markets during the last three years.
49. Other Disclosures
The Company a_rms that the annual listing fees for the Financial Year 2023-24 to
National Stock Exchange of India Ltd. and BSE Ltd. is duly paid.
There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016.
There was no instance of onetime settlement with any Bank or Financial Institution.
50. Acknowledgement
We take this opportunity to thank our employees for their dedicated service and
contribution to the Company.
We would like to place on record sincere thanks and appreciation to all our customers,
partners, vendors, investors, bankers and other business associates for their continued
support and encouragement during the year.
|
For and on behalf of the Board of Directors |
|
Ramesh Kumar Dua |
Mukand Lal Dua |
Delhi |
Managing Director |
Whole Time Director |
May 10, 2023 |
DIN: 00157872 |
DIN: 00157898 |
|