Dear Members,
Your directors are pleased to present the 14th Annual Report on the business and
operations of Sapphire Foods India Limited ("Company") together with the audited
financial statements for the financial year ended 31st March 2023.
Financial Results and Performance
The financial statements of the Company have been prepared in accordance with the
applicable provisions of Indian Accounting Standards ("Ind AS"), Companies Act,
2013 and Rules made thereunder ("Companies Act"), Securities and Exchange Board
of India (Listing Obligations and Disclosure Requirements) Regulations, 2015
("Listing Regulations") and such other applicable rules, regulations,
guidelines, etc., as amended from time to time.
The Company's financial (standalone and consolidated) performance during the financial
year ended 31st March 2023 as compared to the previous financial year, is summarised
below:
(Rs in Million)
Particulars |
Standalone |
Consolidated |
|
F.Y. 2022-23 | |
F.Y. 2021-22 |
F.Y. 2022-23 | |
F.Y. 2021-22 |
Total Income |
19,917.17 |
14,322.47 |
22,966.66 |
17,595.50 |
Less: Total Expenses |
18,909.23 |
14,074.40 |
21,882.42 |
17,081.65 |
Profit/ (Loss) before tax |
1,007.94 |
248.07 |
1,084.24 |
513.85 |
Less: Total tax expense/(credit) |
(1,252.66) |
- |
(1,247.67) |
54.00 |
Profit/ (Loss) after Tax |
2,260.60 |
248.07 |
2,331.91 |
459.85 |
Total Comprehensive lncome/(Loss) for the year, net of tax |
2,259.04 |
231.82 |
2,318.89 |
231.84 |
During the year under review, the total income of your Company was ^ 19,917.17 million
on a standalone basis and Rs 22,966.66 million on a consolidated basis as compared to the
previous financial year total income of Rs 14,322.47 million on a standalone basis and Rs
17,595.50 million on consolidated basis. The net profit/ (loss) for the year under review
after total tax expense/ (credit) stood at Rs 2260.60 million on a standalone basis and Rs
2,331.91 million on a consolidated basis.
The Company has not transferred any amount to the general reserves. There was no change
in the nature of the business of the Company during the year under review.
Business Operations and State of Company's Affairs
Sapphire Foods India Limited, directly and through its' subsidiaries, is one of the
largest franchisees of Yum! Brands in Indian sub-continent with a track record of
successfully operating 743 KFC, Pizza Hut and Taco Bell restaurants across India, Sri
Lanka and Maldives. Your Company has delivered highest revenue, profitability and new
restaurant additions for the financial year ended on 31st March 2023.
For complete detail on Business Operations and State of Company's Affairs, please refer
to the section of 'Management Discussion and Analysis Report' which forms an integral part
of this Annual Report.
Dividend
During the financial year under review, your Directors has not recommended any dividend
to the Shareholders of the Company.
The Board of Directors of your Company has adopted Dividend Distribution Policy based
on the parameters as specified under Listing Regulations. The Policy can be accessed from
the website of the Company at https://www.sapphirefoods.in/investors-
relation/corporate-governance.
Subsidiaries, Joint Venture and Associate Companies
As at the close of the financial year 31st March 2023, your Company has one
wholly-owned subsidiary company viz., Gamma Pizzakraft (Overseas) Private Limited, which
in turn, has three wholly-owned subsidiaries viz., Gamma Pizzakraft Private Limited,
India; Gamma Pizzakraft Lanka (Private) Limited, Sri Lanka & French Restaurant Private
Limited, Sri Lanka and one subsidiary viz., Gamma Island Foods Private Limited, Maldives.
Apart from the above, no other company has become or ceased to be subsidiary, joint
venture or associate of the Company during the financial year under review.
Pursuant to the applicable provisions of Indian Accounting Standards ("Ind
AS"), Companies Act, 2013 and Rules made thereunder ("Companies Act"),
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("Listing Regulations") and such other applicable rules,
regulations, guidelines, etc., the consolidated financial statements presented by the
Company include financial information of the subsidiary companies, which forms part of
this Annual Report. In pursuance of Section 136 of the Companies Act, the annual report of
the Company containing its standalone and consolidated financial statements have been
uploaded on the website of the company. Further, Financials of the subsidiaries, are
available on the website of the Company at
https://www.sapphirefoods.in/investors-relation/annual-reports.
The highlights of performance and financial position of each of the subsidiary company
for the financial year ended 31st March 2023, is provided in form AOC-1, in accordance
with the provisions of Section 129 of the Companies Act, 2013 read with Rule 5 of the
Companies (Accounts) Rules, 2014. The form AOC-1 is enclosed with the Consolidated
Financial Statements and forms an integral part of this Annual Report.
Your Company, in accordance with the Listing Regulations, has formulated and adopted
the policy for determining material subsidiaries. The said policy is available on the
website of the Company at https://www.sapphirefoods.in/investors-relation/
corporate-governance
The Company has obtained a certificate from M/s. S R B C & Co. LLP, Statutory
Auditor, for financial year ended 31st March 2023 certifying that the Company is in
compliance with the Foreign Exchange Management (Non - Debt Instruments) Rules, 2019 read
with Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments)
Regulations, 2019 with respect to Downstream Investment. The said certificate issued by
the Statutory Auditor does not contain any observation and is free from qualifications.
Scheme of Merger by Absorption of Gamma Pizzakraft (Overseas) Private Limited and Gamma
Pizzakraft Private Limited, wholly-owned subsidiaries with Sapphire Foods India Limited
and their respective shareholders
The Board of Directors of your Company at their meeting held on 11th February 2022,
subject to requisite approvals/ consents, approved the Scheme of Merger by Absorption of
Gamma Pizzakraft (Overseas) Private Limited ("GPOPL") and Gamma Pizzakraft
Private Limited ("GPPL") with Sapphire Foods India Limited ("Company")
and their respective shareholders ("Scheme") under the applicable provisions of
the Companies Act and Listing Regulations. The appointed date of the Scheme is 1st April
2022. Upon the Scheme becoming effective, all equity shares held by the Company in GPOPL
and GPOPL in GPPL shall stand cancelled, without any further act or deed and no
consideration shall be issued on merger.
The scheme application was filed and admitted with the National Company Law Tribunal
(NCLT), Mumbai Bench on 5th May 2022. The merger formalities is currently in progress.
Increase in Equity Stake of Gamma Island Food Private Limited, step-down subsidiary of
Sapphire Foods India Limited ("Company") through Gamma Pizzakraft
(Overseas) Private Limited, wholly-owned subsidiary of the Company
During the year under review, the Board of Directors of Gamma Pizzakraft (Overseas)
Private Limited ("GPOPL"), wholly-owned subsidiary of Sapphire Foods India
Limited ("Company"), has considered and approved subscription of upto 81,914
Equity Shares of Gamma Island Food Private Limited ("GIFPL"), subsidiary of
GPOPL and step-down subsidiary of the Company, for a total consideration of upto MVR
18,840,220 ("Proposed Acquisition"). Pursuant to this proposed acquisition, the
equity share holding of GPOPL in GIFPL will be increased from the existing 51% up to 75%.
The proposed acquisition will be completed on or before 30th June, 2023.
Share Capital Authorised Share Capital
During the financial year under review, there was no change in the authorised share
capital of the Company. The authorised share capital of the company as on 31st March 2023
amounted to Rs 4,31,68,20,000 comprising of 43,16,82,000 Equity Shares of face value of Rs
10 each.
Issued, Subscribed and Paid-up Share Capital
As on 31st March 2023, the issued, subscribed and paid-up capital of the Company stands
at Rs 63,54,25,410 comprising of 6,35,42,541 equity shares of face value of Rs 10 /- each.
The Company has not issued any shares with differential rights and hence no information
as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies
(Share Capital and Debenture) Rules, 2014 is furnished.
Employee Stock Option Plan / Schemes
With a view to attract, reward and retain talented and key employees in the competitive
environment and encourage them to align individual performance with Company objectives,
the Company has implemented Sapphire Foods Employees Stock Option Plan 2017 ("ESOP
Plan") which was originally approved by the Board of Directors and the Shareholders
of the Company on 24th May 2018 and 30th May 2018 respectively. Sapphire Foods Employees
Stock Option Scheme 2019 - Scheme III - Management other than CEO ("Scheme
III"), Sapphire Foods Employees Stock Option Scheme 2019 - Scheme IV - CEO
("Scheme IV"), Sapphire Foods Employee Stock Option Scheme 2022 - Scheme III A -
Management other than CEO ("Scheme III A") and Sapphire Foods Employee Stock
Option Scheme 2022 - Scheme IVA - CEO ("Scheme IVA") (hereinafter collectively
referred to as "ESOP Schemes") forms an integral part of the ESOP Plan. With a
view to reward loyalty for past services with the Company, retention of critical employees
and align employees' interest with company's performance and shareholder's interest, the
Company has granted, from time to time, stock options to the eligible employees under the
said ESOP Plan / Schemes.
Subsequent to the Initial Public Offering ("IPO") of the Company in November
2021, the shareholders of the Company, pursuant to the approval and recommendation of the
Nomination and
Remuneration Committee and Board of Directors at their respective meetings, has passed
special resolutions by way of postal ballot on 8th April 2022 for:
Ratification of Sapphire Foods Employees Stock Option Scheme 2019 - Scheme III -
Management other than CEO and Sapphire Foods Employees Stock Option Scheme 2019
Scheme IV-CEO read with Sapphire Foods Employees Stock Option Plan 2017;
Amendment of ESOP Plan to increase the quantum of options reserved under the
ESOP Plan from 28,39,033 stock options to 43,33,889 stock options by creating additional
14,94,856 stock options convertible into equivalent number of equity shares of face value
of Rs 10 each fully paid-up, upon exercise of vested options;
Approval and Institution of Sapphire Foods Employee Stock Option Scheme 2022 -
Scheme IIIA - Management other than CEO read with Sapphire Foods Employees Stock Option
Plan 2017;
Approval and Institution of Sapphire Foods Employee Stock Option Scheme 2022 -
Scheme IVA-CEO read with Sapphire Foods Employees Stock Option Plan 2017;
Approval of grant of stock options to Whole-time Director & Group CEO
exceeding 1 % of the issued and paid-up capital of the Company.
The shareholders of the Company, further, at their 13th Annual General Meeting held on
2nd September 2022, pursuant to the recommendation of the Nomination and Remuneration
Committee and Board of Directors at their respective meetings, has passed special
resolutions for:
Ratification of Sapphire Food Employees Stock Option Scheme 2019 - Scheme III -
Management other than CEO read with Sapphire Foods Employees Stock Option Plan 2017, for
grant of options to the eligible employees of subsidiary companies.
Approval of grants under Sapphire Foods Employee Stock Option Scheme 2022 -
Scheme III A - Management other than CEO read with Sapphire Foods Employee Stock Option
Plan 2017 to the eligible employees / directors of the subsidiary company(ies) of the
Company.
The Nomination and Remuneration Committee of the Board is entrusted with the
responsibility of implementation and administration of the ESOP Plan / Schemes.
The details of ESOP are provided in the notes to accounts in the financial statements
forming part of this Annual Report and the disclosures as mandated under Securities and
Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021
("SEBI SBEB & SE Regulations") are made available on the website of the
Company at https://www. sapphirefoods.in/investors-relation/updates. Certificate from M/s.
Alwyn Jay & Co. LLP, Secretarial Auditors of the Company, with respect to the
implementation of ESOP Plan / Schemes in accordance with SEBI SBEB & SE Regulations
shall be placed before the members at the ensuing Annual General Meeting of the Company.
The Company has not issued any sweat equity shares during the year under review and
hence no information as per the provisions of Companies Act and SEBI SBEB & SE
Regulations is furnished thereto.
Credit Rating
As at the end of the financial year 31st March 2023, long-term rating on the bank lines
of your company is [IC RA]A (Stable) and the long term/short term unallocated limits is
[ICRA]A(Stable)/ [ICRA]A2+.
Deposits
The Company has not accepted or renewed any amount falling within the purview of
provisions of Section 73 of the Companies Act 2013 read with the Companies (Acceptance of
Deposit) Rules, 2014 during the year under review. Elence, the requirement for furnishing
of details relating to deposits covered under Chapter V of the Companies Act or the
details of deposits which are not in compliance with Chapter V of the Companies Act is not
applicable.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report for the financial year under review, as
prescribed under Listing Regulations, is presented as a separate section which forms an
integral part of this Annual Report.
Report on Corporate Governance
Your 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. A separate report on Corporate Governance for the financial year ended 31st
March 2023 is appended to this report and forms an integral part of this annual report.
A certificate from Practicing Company Secretary confirming the compliance with the
conditions of Corporate Governance under Listing Regulations is also annexed to the report
on Corporate Governance.
Environment, Social and Governance & Corporate Social Responsibility Practices
Environment, Social and Governance (ESG) has long been an integral to our journey and
your company recognise it as a continuous path that requires a clear strategy and roadmap.
As part of the ESG journey, your company aim to reduce the carbon footprint of our value
chain and to improve business resilience by managing the short and long-term risks and
impacts of climate change. Your company also endeavor to have a diverse, equitable and
inclusive workplace which makes us stronger and enables us to create a better shared
future for employees and communities. The Company is committed for making a tangible
difference in society through interventions across four strategic pillars i.e., People,
Planet, Food and Governance. The ESG Report for FY2023 is published along side this Annual
Report and can be accessed at https://www.sapphirefoods.in/investors-relation/
annual-reports.
In accordance with the provisions of Section 135 of the Companies Act, 2013 and Rules
made thereunder, your Company has formed a Corporate Social Responsibility (CSR) Committee
to monitor CSR activities of the Company. During the financial year 31st March 2023, the
scope of the existing CSR Committee was enhanced to accommodate the scope of ESG / BRSR
framework and the Committee was renamed as "CSR & ESG Committee" of the
Board of Directors. The details of the Committee and its terms of reference are set out in
the Corporate Governance Report forming part of this Report.
The Board of Directors has approved a CSR Policy for the Company which provides a broad
framework with regard to implementation of CSR activities carried out by the Company in
accordance with Schedule VII of the Act. The CSR Policy is available on the Company's
website at https://www. sapphirefoods.in/investors-relation/corporate-governance.
The Business Responsibility and Sustainability Report ("BRSR") as mandated
under Listing Regulations, detailing the various initiatives taken by your Company from
the Environmental, Social and Governance perspective, forms part of this annual report and
is appended hereinbelow. The Annual Report on CSR activities as prescribed under the
Companies Act and Rules made thereunder is also annexed to this report.
Directors and Key Managerial Personnel
The Board of Directors are constituted in accordance with the provisions of Companies
Act and Listing Regulations and Articles of Association of the Company. The Company has
received relevant disclosures and declarations from the Directors and none of them are
disqualified from being appointed as Director in terms of Section 164(2) of the Companies
Act and Listing Regulations.
Your Board consists of eminent personalities with considerable professional expertise
and credentials in finance, law, accountancy and other related skills and fields. Their
wide experience and professional credentials help the Company for strategy formulation and
its implementation, thereby enabling its growth objectives. As at 31st March 2023, the
composition of Board of Directors of your Company was as under:
Sr.
No. |
Name of Director |
Designation |
DIN |
1. |
Mr. Sunil Chandiramani |
Chairman & Independent Director |
00524035 |
2. |
Mr. Sanjay Purohit |
Whole Time Director & Group CEO |
00117676 |
3. |
Mr. Sumeet Narang |
Non-Executive Nominee Director |
01874599 |
4. |
Mr. Vikram Agarwal |
Non-Executive Nominee Director |
03038370 |
5. |
Mr. Kabir Thakur |
Non-Executive Nominee Director |
08422362 |
6. |
Mr. Vinod Nambiar |
Non-Executive Nominee Director |
07290613 |
7. |
Mr. Paul Robine |
Non-Executive Nominee Director |
07828525 |
8. |
Ms. Anu Aggarwal |
Independent Director |
07301689 |
9. |
Ms. Deepa Wadhwa |
Independent Director |
07862942 |
10. |
Mr. Norbert Fernandes |
Alternate Director |
06716549 |
The Board of Directors at their meeting held on 17th May 2022 had appointed Mr. Norbert
Fernandes (DIN: 06716549) as an Alternate Director (in the capacity of Non-Executive Non-
Independent Nominee Director) to Mr. Paul Robine. During the financial year under review,
there were no other changes in the Directorship of the Company.
As on the date of this report, Mr. Paul Robine has resigned from the Board of Directors
of the Company and consequently Mr. Norbert Fernandes ceased to be the Alternate Director
to Mr. Paul Robine effective from 12th May, 2023. Further, pursuant to the recommendation
of Nomination and Remuneration Committee, Mr. Norbert Fernandes was appointed as
Additional (Non-Executive Nominee) Director by the Board of Directors on 12th May 2023.
The regularisation of Mr. Norbert Fernandes as Non-Executive Nominee Director shall be
placed before the shareholders at the ensuing 14th Annual General Meeting of the Company.
Retirement by Rotation
In terms of Section 152 of the Companies Act, 2013 and Articles of Association of the
Company, Mr. Vikram Agarwal and Mr. Kabir Thakur, Non-Executive Nominee Directors of the
Company, retires by rotation and being eligible, offers themselves for re-appointment at
the ensuing 14th Annual General Meeting of the Company.
The brief profile in terms of Regulation 36 of Listing Regulations and the Secretarial
Standards on General Meetings (SS-2), in respect of the directors seeking
appointment/re-appointment has been annexed to the notice of the 14th Annual General
Meeting.
Independent Directors
Mr. Sunil Chandiramani, Ms. Anu Aggarwal and Ms. Deepa Wadhwa were appointed as
Independent Directors of the Company, effective 5th August 2021, for a fixed term of five
years from the date of their respective appointment/regularisation by the shareholders.
Mr. Sunil Chandiramani is designated as the Chairperson of the Board of Directors.
The Company has received declarations from the Independent Directors of the Company
confirming that they continue to meet the criteria of independence, as prescribed under
applicable provisions of the Companies Act and Listing Regulations. The Independent
Directors have also confirmed that they have complied with the Code of Conduct of the
Company and that they have registered themselves as an Independent Director in the data
bank maintained with the Indian Institute of Corporate Affairs. The Independent Directors
of the Company are not liable to retire by rotation.
The Board is of the opinion that the Independent Directors of the Company possess
requisite qualifications, experience and expertise in the fields of strategy, planning and
execution, management and leadership, functional and managerial experience, legal and risk
management, corporate governance systems and practices, finance, banking and accounts and
they hold highest standards of integrity and are independent of the management.
Key Managerial Personnel
Pursuant to the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read
with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
following persons are the Key Managerial Personnel ("KMP") of your Company:
Name of the KMP |
Designation |
Mr. Sanjay Purohit |
Whole Time Director & Group CEO |
Mr. Vijay Jain |
Chief Financial Officer |
Mr. Sachin Dudam |
Company Secretary & Compliance Officer |
During the year under review, there has been no change in the Key Managerial Personnel
of the Company.
Board Meetings
During the financial year 2022-23, four (4) meetings of the Board of Directors were
convened and held. The meetings were held as per the business requirements and maximum gap
between any two Board Meetings is within the permissible limits as prescribed under the
Companies Act and Listing Regulations.
The details of the composition of the board, meetings held during the year and the
attendance of the Directors at the Board Meetings, inter-alia, are provided at Report on
Corporate Governance, forming part of this Report.
The Company has complied with the Secretarial Standards issued by the Institute of
Company Secretaries of India (ICSI) on meetings of Board of Directors and General
Meetings.
Board Committees
The Board of Directors of the Company has constituted following Committees in order to
effectively carry out some of the diverse functions of the Board:
Audit Committee
Nomination and Remuneration Committee
Stakeholders Relationship Committee
Risk Management Committee
CSR & ESG Committee
Operations Committee
IPO Committee
The details of the composition of these committees of the Board, meetings held during
the financial year, etc. are set out at the Report on Corporate Governance, forming part
of this Report.
Familiarsiation Programme
Pursuant to Regulation 25 of Listing Regulations, the Board of Directors has framed a
policy to familiarise the Independent Directors about the Company. The Company shall
conduct orientation programs / presentations / training sessions/ store visits,
periodically at regular intervals, to familiarise the Directors including Independent
Directors with the strategy, operations and functions of the Company. The Directors are
also familiarised through presentation on business performance /operations, risk
management framework, etc. at the Board Meetings.
The details as per the applicable provisions of the Companies Act and Listing
Regulations are posted on the website of the Company at
https://www.sapphirefoods.in/investors-relation/ corporate-governance.
Board Evaluation
In accordance with the provisions of Companies Act and Listing Regulations, the Board
of Directors shall conduct formal evaluation, on annual basis, of its own performance and
that of its committees and individual directors including chairperson. The Nomination and
Remuneration Committee is mandated for formulating criteria for evaluation of performance
of the Board of Directors and its Committees and Directors.
Pursuant to determination of criteria by the Nomination and Remuneration Committee, the
Company has carried out performance evaluation surveys for the Board of Directors and its
Committees, Individual Directors including Whole-time Director & Group CEO,
Chairperson, etc. The evaluation surveys were circulated to the concerned board members
through BoardPAC application. All the Directors had actively participated in the
evaluation surveys carried out by the Company.
The results along with feedback were shared with the Independent Directors at a duly
convened meeting of the Independent Directors for their consideration. The Independent
Directors, at their meeting held on 21st March 2023, deliberated in detail on the
performance evaluation of the Board of Directors (as a whole), its Committees and
Non-Independent Directors including Whole-time Director and Chairperson, inter-alia.
Thereafter, the feedback from the meeting of the Independent Directors and board
evaluation were presented to the Management and Board of Directors for their perusal and
implementation thereof.
Nomination and Remuneration Policy
In compliance with Section 178 of the Companies Act, 2013 and Regulation 19 of Listing
Regulations, the Board of Directors have formulated and adopted Nomination and
Remuneration Policy for the Company, covering following objectives:
To lay down criteria and terms and conditions for identifying persons who are
qualified to become Directors & KMPs and who may be appointed / reappointed in Senior
Management of the Company.
To provide framework for remuneration of Directors and Employees and align with
the Company's business strategies, values, key priorities and goals.
To provide for rewards linked directly to the effort, performance and
achievement of Company's targets by the employees.
Formulating the criteria for performance evaluation of all Directors
Succession Planning for Board and Senior Management
Board Diversity
The salient features of this policy have been disclosed in the Report of Corporate
Governance, forming part of this Report. The Nomination and Remuneration Policy of the
Company can be accessed on the website of the Company at https://www.
sapphirefoods.in/investors-relation/corporate-governance.
Particulars of Employees
The disclosures pertaining to remuneration and other required information pursuant to
Section 197(12) of the Companies Act read with Rule 5(1) of The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, in respect of Directors, Key Managerial
Personnel's and Employees of the Company, is appended to this report and forms part of
this Annual Report.
The disclosure pertaining to remuneration as required under provisions of Section
197(12) of the Companies Act read with Rule 5(2) & 5(3) of Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 forms part of this Annual Report. In
terms of Section 136(1) of the Act and the rules made thereunder, the Report and Financial
Statements are being sent to the shareholders excluding the said information. Any
shareholder interested in obtaining copy of the aforesaid information, may send an email
to the Company Secretary and Compliance Officer at investor@sapphirefoods.in.
Auditors Statutory Auditors
M/s. S R B C & Co. LLP, Chartered Accountants (Registration No. 324982E/E300003)
were re-appointed as Statutory Auditors of the Company at Annual General Meeting held on
15th October 2020, for a term of five consecutive years to hold office from the conclusion
of 11th Annual General Meeting (AGM) till the conclusion of 16th Annual General Meeting of
the Company. The auditors have confirmed that they are not disqualified from being
re-appointed as Statutory Auditors of the Company and that they hold a valid certificate
issued by the Peer Review Board of the Institute of Chartered Accountants of India.
The report given by the Statutory Auditors on the Financial Statements (Standalone and
Consolidated) of the Company for financial year ended 31st March 2023 are annexed to the
Financial Statements, forming an integral part of this Annual Report. The Auditors' Report
read together with Annexures referred to in the Auditors' Report for the financial year
ended 31st March 2023 does not contain any qualification, reservation, adverse remark or
disclaimers. During the year under review, the Statutory Auditors have not reported any
matter of frauds under Section 143(12) of the Companies Act.
Internal Auditors
The Company had appointed M/s. Deloitte Touche Tohmatsu India LLP, Chartered
Accountants, as Internal Auditor Partner for carrying out the activities of Management
Testing of Internal Financial Controls and Internal Audit of various business/ functions
process for the financial year 31st March 2023.
The Company had designated Mr. Balkrishna Chaturvedi, Head- Management Assurance and
Special Projects, as Internal Auditor of the Company, in compliance with the provisions of
Section 138 of the Companies Act, 2013 and Rules framed thereunder.
Internal Audit Reports are reviewed by the Audit Committee of the Company at their
meetings held during quarterly intervals. Both internal auditors carry out their functions
as per the scope of work assigned and place their reports at the meetings of the Audit
Committee, during quarterly intervals.
Secretarial Auditors
Pursuant to Section 204 of the Companies Act, 2013, the Board of Directors, has
appointed M/s. Alwyn Jay & Co., Practising Company Secretaries (Firm Registration No.
P2010MH021500) as Secretarial Auditor for carrying out secretarial audit and requisite
certifications as mandated under Companies Act and Listing Regulations.
The Secretarial Audit Report for the financial year ended 31st March 2023 received from
M/s. Alwyn Jay & Co., Secretarial Auditor of the Company is annexed to this report and
forms an integral part of this Annual Report. The Report does not contain any
qualifications, reservations, adverse remarks, disclaimers or reporting of fraud.
Cost Auditors
The Company is not required to maintain cost records, as specified by the Central
Government under section 148 of the Companies Act, 2013 and Rules made thereunder.
Particulars of Investments, Loans, Guarantees and Securities
The full particulars of the loan, investments, guarantees and securities, in accordance
with the applicable provisions of the Companies Act, 2013 and Listing Regulations made by
your Company during the financial year 2022-23, has been furnished at Note 5 to the Notes
to Accounts of the Financial Statements forming an integral part of this Annual Report.
Particular of Contracts or Arrangements with Related Parties
The Related Party Transactions are placed at the meetings of the Audit Committee /
Board of Directors for their respective approval. Prior omnibus approval of the Audit
Committee is obtained by the Company on an annual basis for Related Party Transactions
that are foreseeable and repetitive in nature. A detailed statement of such Related Party
Transactions entered into pursuant to the omnibus approval so granted are placed at the
meetings of the Audit Committee for their review on a quarterly basis. The half yearly
statement on the Related Party Transactions are also filed with the respective stock
exchanges on which the equity shares of the Company are listed.
The Related Party Transactions entered during the financial year under review were in
the ordinary course of business and on arm's length basis. There were no significant
material related party transactions entered into by the Company with any related party
during the financial year under review. Thus, the disclosure under Section 134 of the
Companies Act, 2013 as per specified form AOC-2 is not applicable to the Company.
Details of Related Party Transactions as per Indian Accounting Standard - 24 (Ind AS
24) are given under Note 36 forming part of the Notes to Account of the Standalone
Financial Statements to this Report.
Pursuant to the provisions of the Companies Act and Listing Regulations, your company
has formulated a policy on Related Party Transactions for the purpose of identification
and monitoring of such transactions, which is available on the website of the Company at -
https://www.sapphirefoods.in/ investors-relation/corporate-governance.
Annual Return
Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of the Companies Act,
2013, the copy of the Annual Return of the Company for the financial year ended 31st March
2023 is placed at the Company's Website and can be accessed at
https://www.sapphirefoods.in/investors-relation/updates
Risk Management Policy
Adequate Risk Management Framework is a necessity for the purpose of Risk Assessment
and minimisation/mitigation of risks involved in business activity. The Company has laid
down a robust risk management framework for identification and management of risks that
could adversely affect the Company. The Company has formulated Risk Management Policy in
order to achieve the following objectives, inter-alia:
To ensure that all the current and future material risk exposures of the Company
are identified, assessed, appropriately mitigated, minimised and managed i.e. to ensure
adequate systems for risk management.
To establish a framework for the company's risk management process and to ensure
its implementation.
To enable compliance with appropriate regulations, wherever applicable, through
the adoption of best practices.
To assure business growth with financial stability.
In terms of the provision of Regulation 21 of Listing Regulations, the Board of
Directors has constituted a Risk Management Committee. The details with respect to its
terms of reference, composition and meetings held during the part of the financial year
under review are set out at the Report on Corporate Governance, annexed to this Report.
The Audit Committee has additional oversight in the area of financial risks and controls.
The major risks identified by the businesses and functions are systematically addressed
through mitigating actions on a continuing basis.
The Risk Management Policy is also available on the website of the Company at
https://www.sapphirefoods.in/investors-relation/ corporate-governance. For more details on
risk management framework, please refer to the section of 'Management Discussion and
Analysis Report' which forms an integral part of this Annual Report.
Vigil Mechanism
The Company believes in the conduct of the affairs of its constituents in a fair and
transparent manner by adopting the highest standards of professionalism, honesty,
integrity and ethical behavior.
Your Company has adopted a Whistle Blower Policy to provide a mechanism for the
employees to report genuine concerns about any unethical behavior, actual or suspected
fraud or violation of your Company's Code of Conduct. During the year under review, this
policy was amended to enhance the scope for the vendors and suppliers of the company and
subsequently the code of conduct for suppliers was introduced and promulgated.
The concerned constituents including employees of the Company are encouraged to voice
their concerns internally and at a high level and to disclose information which the
individual believes shows malpractice or impropriety. A designated email id
whistleblower@sapphirefoods.in has been created and disseminated through this policy/code
to the concerned stakeholders to voice their grievances. The access of this designated
email id is mapped and made available to the members of the Audit Committee including its
Chairperson.
The provisions of this policy are in line with the provisions of Section 177 (9) of the
Companies Act, 2013 and Regulation 22 of Listing Regulations. All cases registered under
the whistle blower policy of the Company are subject to review by the Audit Committee. The
Whistle Blower policy of the Company is available on the Company's website at https://www.
sapphirefoods.in/investors-relation/corporate-governance.
Disclosure Under Sexual Harassment of Women at Work Place (Prevention, Prohibition and
Redressal) Act, 2013
In line with the requirements of the Sexual Harassment of Women at the Workplace
(Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act"), your Company has
in place a policy on prevention, prohibition and redressal of sexual harassment at
workplace. All employees (permanent, contractual, temporary, trainees) including at stores
level, are covered under this policy.
As per the rules made under the POSH Act, the Company has constituted an Internal
Complaints Committee (ICC) to redress the complaints received pertaining to sexual
harassment at workplace. The Committee meets, as and when required, to discuss various
cases received and to address the same uniformly across the organisation.
The details of the complaints received during the financial year 2022-23 are as
follows:
Particulars |
No. of Complaints |
Complaints pending as on start of the financial year i.e. 1st April
2022 |
1 |
Complaints received during the financial year under review |
8 |
Complaints disposed off during the financial year under review |
9 |
Complaints pending as on end of the financial year i.e. 31a March 2023 |
0 |
An update on the aforesaid complaints received and disposed are placed at the meetings
of the Audit Committee during quarterly intervals.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
The activities of the Company are not energy intensive as the Company is not engaged in
any manufacturing activity. Further, no technology has been developed and / or imported by
way of foreign collaboration.
For complete details, please refer to the section of 'Business Responsibility and
Sustainability Report' which forms an integral part of this Report. The particulars with
regard to Foreign Exchange Earnings and Outgo are given in Standalone and Consolidated
Financial Statements, forming part of this Annual Report.
Disclosure of Orders Passed by Regulators or Courts or Tribunal
During the financial year under review, there were no significant/ material orders
passed by the Regulator, Courts, Tribunals, etc. which can have an impact on the going
concern status and the Company's operations in future.
The Company has not filed any application under Insolvency and Bankruptcy Code, 2016 as
at the end of the financial year 31st March 2023. However, during the financial year ended
on 31st March 2023, two petitions were pending against your company with National Company
Law Tribunal ("NCLT") filed by operational creditors ("lessors"). Your
company would like to clarify and state that the monetary demands raised by these
operational creditors are unreasonable and inappropriate. Your company will make the
necessary appearance before the NCLT in the concerned cases and is of the belief that the
petitions may not be admitted by the Hon'ble NCLT and strike-off at the outset.
Internal Financial Controls
Your Company has aligned its current systems of internal financial control with the
requirement of Companies Act 2013. The Internal Control Framework is intended to increase
transparency and accountability in an organisation's process of designing and implementing
a system of internal control. Your Company has successfully laid down the framework and
ensured its effectiveness. The internal controls are commensurate with the size of the
Company and the nature of its operations. These have been designed to provide reasonable
assurance with regard to recording and providing reliable financial and operational
information, complying with applicable statutes, safeguarding assets from unauthorised
use, executing transactions with proper authorisation and ensuring compliance with
corporate policies.
M/s. S R B C & Co LLP, Statutory Auditors of the Company have audited the financial
statements included in this annual report and have issued an attestation report on our
internal control over financial reporting (as defined in section 143 of Companies Act
2013).
The internal audit department along with the external partners/ consultants carry out
internal audit of the Company's business/ functional activities. The audit is based on an
internal audit plan, which is reviewed each year in consultation with and approved by the
audit committee. The audit committee reviews reports submitted by the internal auditor,
internal audit partner and statutory auditor. Basis inputs received from the audit
committee, suggestions for improvement are considered and the audit committee follows up
on corrective action.
Based on the framework of internal financial controls and compliance systems
established and maintained by the Company, the work performed by the internal auditor,
statutory auditors and external partner/consultant, including the audit of internal
financial controls over financial reporting by the statutory auditors and the reviews
performed by management and the relevant board committees, including the audit committee,
the Board is of the opinion that the Company's internal financial controls were adequate
and effective during the financial year ended 31st March 2023.
Director's Responsibility Statement
In terms of Section 134(5) of the Companies Act, 2013, the
Board of Directors hereby confirms that:
a. in the preparation of the annual accounts, the applicable accounting standards have
been followed and there are no material departures;
b. they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company as at 31st March 2023 and of the profit/loss of the
Company for that year;
c. they have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d. they have prepared the annual accounts of the Company on a going concern basis;
e. they have laid down internal financial controls to be followed by the Company and
such internal financial controls are adequate and operating effectively;
f. they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
Material Changes and Commitments, if any. Affecting Financial Position of the Company
Except as disclosed in this report, no material changes and commitments which could
affect the Company's financial position, have occurred between the end of the financial
year of the Company and date of this report.
Acknowledgements and Appreciation
The Board places on record its appreciation for the support and co-operation, your
company has been receiving from its various stakeholders including Customers, Suppliers,
Business Partners and Associates, Financial Institutions, Regulatory Bodies and Central
& State Governments.
Your Directors appreciate and value the contribution made by every member of the
Sapphire Family.
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For and on behalf of the Board |
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|
Sapphire Foods India Limited |
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|
Mr. Sunil Chandiramani |
Mr. Sanjay Purohit |
Date: 12th May 2023 |
Chairman and Independent Director |
Whole Time Director and Group CEO |
Place: Mumbai |
DIN: 00524035 |
DIN: 00117676 |
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