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Andhra Paper Ltd
Industry :  Paper
BSE Code
ISIN Demat
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As on: Sep 22, 2023 10:42 PM

Dear Members,

The Board of Directors has the pleasure in presenting its 58th Report along with the Audited Financial Statements for the year ended March 31, 2022.

Performance Review

The performance of the Company for the financial year under consideration has witnessed significant improvement throughout the financial year. These results were driven by higher sales volume and higher sales price realization. Improved productivity from our mills helped to generate more volumes. The Company continued to focus on important initiatives for improving safety and environmental compliance as well as improving the customer experience and operational efficiencies.

Summary of Financial Results

Rs ( in crores)

Particulars For the year ended March 31, 2022 For the year ended March 31, 2021
Revenue from Operations 1,380.23 886.75
Earnings before interest, depreciation and taxation (EBITDA) 265.81 76.11
Finance costs 5.45 4.51
Depreciation 72.01 73.38
Profit / (Loss) before exceptional items 188.35 (1.79)
Exceptional items - (4.41)
Profit / (Loss) before tax 188.35 (6.20)
Tax expense 48.62 (1.60)
Profit / (Loss) for the year 139.73 (4.60)

There was no change in the nature of business during the year.


The Board of Directors at their Meeting held on May 5, 2022 recommended a dividend of Rs. 7.50 per equity share of Rs.10/- each, for approval of the Shareholders at the forthcoming Annual General Meeting, and is incompliance with the Dividend Distribution Policy of the Company. The said Policy is disclosed on the Company's website: www.andhrapaper.com.

Markets, Customers and Commercial Excellence

The Company continues to believe in "Customer First" and its endeavour to create more value for Customers.

The Company's products are predominantly used for printing, publishing and converting for the W&P segment. However, with changing environment due to COVID 19 first wave the Company went in the direction to produce Value Added Products like Cupstock, Pharma Print and Kraft. This capability helped in the second wave resulting in increased sales of Cupstock (YoY 38%), High BF Virgin Kraft (YoY 1893%) and Pharma Print (YoY 110%).

Apart from developing new products, keeping industry dynamics in mind, continuous endeavour is being made to improve the existing products based on feedback from customers & channel partners to make our products suit their requirements.

The Company overcame the challenging situation in Q1 & Q2 by leveraging the existing Export Network and existing Product Portfolio to balance the supply position into Exports resulting in increased sales of 177% YOY.

With focus on meeting the changing work environment from WFH to Offices in the later part of the year, the copier products were given thrust resulting in YoY growth of 37%.

It is therefore gratifying that even during these trying times the Company's performance ranked amongst the best in the paper industry. Despite the volatility in Q1 & Q2 during the partial lockdowns, online classes and WFH, the Company achieved the highest sales in a year at 2,40,479 Tons (YoY 39%) with Zero Stock at the close of the year.

Though FY 2021–22 was another challenging year which was mainly affected by partial lockdowns, WFH, closure of Educational Institutions and restrictions on logistics due to Covid-19, the Company had put in its best efforts to achieve OTIF delivery rate (On- Time-In-Full) at 95%, forecast accuracy to 92.5% and improved complaint closure to ~84% which is top tier in the Indian paper industry.

The Company's concept of "Think Customer" continues to yield desired results to enhance customer value by way of offering ‘right products for right applications' at an increased speed to address customer needs & grievances.

FY 2022 Highlights:

• Highest Sales of 2,40,479 Tons

• Increased Export Sales by 177%, one of the best in the Paper Industry

• Significant growth in VAP segment like Cup Stock (38%), Pharma Print (110%) & HBF Kraft (1893%)

• OTIF Score – 95%, one of the best in the Paper Industry

Raw Material Security

The Company believes that the long-term sustainability for supply of virgin fibre depends on farm-forestry program and ensuring farmer's willingness to continue plantation of virgin fibre by improving yield of crops per unit area. The Company believes that improving yield, besides ensuring right price of the produce, is the only way by which farmer's income can be increased. Therefore, the Company remains focused on continuous Research & Development (R&D) program for production of high yielding quality clones for increasing productivity of land. The Company remains committed in collaborating with likeminded premium institutes e.g. Institute of Forest Genetics & Tree Breeding, Coimbatore (IFGTB) to ensure right approach for capacity building of stakeholders, sharing of best practices and execution of R&D program for enhancing productivity of farmer's land.

The Company remains committed in capacity building of local community in the journey envisaged for long-term sustainability for supply of virgin fibre through farm-forestry program. With this vision, the Company has embarked on a journey of developing partner nurseries in respective areas within a radius of 150 KM from the Mills to cater to the requirement of clones of farming community to increase plantation in the catchment area for sustainable supply of virgin fibre. The Company had partnered with 19 Clonal Production Centres (CPC) during the year for production and distribution of high yielding Casuarina clones. The Company continues to reach out to farmers, create awareness on the price offered and ensuring that farmers get maximum benefit in the supply chain of Virgin Fibre.

The Company has facilitated distribution of 563 lakhs of Casuarina clones and seedlings combined, covering 6,327 hectares of land and generated 31.6 lakhs man-days of employment to the farmers under the farm-forestry program within the catchment area.

Employee Development and Engagement

The Company's agenda for engaging and developing its employees includes initiatives to attract, develop and retain talent. The key focus areas include diversity and inclusion, succession planning, developing a talent pool for critical positions, quality of life programs and leadership development.

The Company has taken a professional approach to industrial relations. The Company continued to treat people with dignity and respect as well as upheld important principles of labour relations.

Leveraging the power of Information Technology

During the year under review, the Company achieved lot of IT effectiveness in business areas and enhanced the technological use in organisation.

Over the year 2021-22 there has been significant improvement in the IT Division's innovation, improvements of applications, delivery of user's service, project management and the overall contribution to the organisation's mission and goals.

Enhancement of the performance of SAP S/4 HANA as it relates to complex and time driven business activities such as real-time planning, execution, reporting and analytics based on live data, as well as prompt period closing and improved forecasting including SAP Analytics on Cloud (SAC) for insights and decision making and proliferation of visualisation tools like Power BI across the function.

The following projects were implemented during the year and successfully rolled out:

• SAP Treasury and Risk Management applications;

• SAP GRC (Governance Risk Compliance) application in identifying and managing risks in a proper manner.

• SAC (SAP Analytic Cloud)

• Developed in-house REEL WRAPING integration system with SAP

• Alternate printing solution against HP Managed printing service

• Implemented in- house grievance system for cost optimisation of Cloud GRIVANCE SYSTEM and successfully rolled out.

Outsourced Share Point portal service

• CYBERSECURITY implemented by CISCO umbrella, AMP, endpoint security with dual factor e-mail security system

• SharePoint

• Kronos - Contractor Management System (CMS) to provide a single window experience for HR

• Zoom video collaboration system with added benefit of reducing the costs, time and network bandwidth

Community Service and Engagement

The Company is committed to the cause of communities where it operates, by supporting Education, Health & Wellness and other genuine requirements of the people therein.

The Company considers the community as its key stakeholder and is one of the foremost proponents of inclusive growth and has continued to undertake projects for overall development and welfare of the society in the fields of health, education, rural development and livelihood interventions etc., and is sensitive to its needs. The Company also extended co-operation and assisted the local administration in taking various preventive and safety measures.

The Company had adopted a CSR Policy which is placed on the Company's website: www.andhrapaper.com. The Members of Corporate Social Responsibility Committee as on March 31, 2022 comprised of:

Mr. Virendraa Bangur Chairman
Mr. Saurabh Bangur Member
Mr. Sudarshan V. Somani Member
Mr. Rajendra Jain Member

The Annual Report on CSR activities is attached as Annexure – 1 to this report.


During the year, the Company was awarded "Best Safety Performer for the year 2021" by Confederation of Indian Industry for Unit: Kadiyam.

Related Party Transactions

All related party transactions that were entered into during the financial year under review were at arm's-length basis and also in the ordinary course of business. There were no material significant related party transactions entered into by the Company with the Promoters, Directors, Key Managerial Personnel which may have a potential conflict with the interests of the Company at large.

The Board of Directors approved a Policy on Related Party Transactions which is placed on the Company's website www. andhrapaper.com. The disclosures on related party transactions are given in Notes to the financial statements.

Remuneration Policy

The Company has adopted the Nomination and Remuneration Committee Charter which contains, inter alia, framework for Directors' appointment and remuneration, criteria for determining the qualifications, positive attributes, independence of a director and other matters provided under Section 178(3) of the Companies Act, 2013 ("The Act").

Pursuant to Section 178(4) of the Act, the Company also adopted Remuneration Policy relating to remuneration for the Directors, Key Managerial Personnel and Senior Executives in the rank of Vice President and above. The Remuneration Policy is placed on Company's website www.andhrapaper.com.

Energy Conservation, Technology Absorption & Foreign Exchange earnings and outgo

Particulars of conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Annexure - 2 attached to this Report.

Risk Management

The Company has a robust business risk management framework to identify and evaluate business risks and opportunities. This framework aims to create transparency, minimize adverse impact of risks on the business objectives and enhance the Company's competitive advantage. Some of the critical risks that have been identified are Fibre Procurement, Competition risk, Occupational Health & Safety, etc.


a. During the year under review, Mr. Mukesh Jain has been appointed as a Whole-time Director designated as Director - Commercial & Key Managerial Personnel effective November 10, 2021 in place of Mr. Anish T. Mathew who resigned as a Director of the Company effective November 09, 2021.

b. Independent Directors

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149 (6) of the Act and Regulations 16(1)(b) and 25(8) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the SEBI Listing Regulations") and that they are independent from the Management of the Company and they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact his ability to discharge his duties with an objective independent judgment and without any external influence. Further, all the Independent Directors have given declarations that they complied with the provisions of Companies (Appointment and Qualifications of Directors) Rules, 2014. Further they have given declarations that they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Code of Business Conduct and Ethics of the Company.

A separate Meeting of Independent Directors was held on January 19, 2022. All the Independent Directors of the Company attended the said Meeting.

Mr. Praveen P. Kadle and Mr. Adhiraj Sarin, Independent Directors, completed their second term on March 31, 2022 and the Company filled the vacancies by appointing Mr. Virendra Sinha and Mr. Sitaram Sharma as Independent Directors of the Company for a period of 3 years effective April 1, 2022.

c. Non-Executive Directors

Mr. Virendraa Bangur, Director, is liable to retire by rotation at the ensuing Annual General Meeting, as per the provisions of the Companies Act, 2013 and being eligible, offered himself for reappointment.

d. Details of Key Managerial Personnel

As on March 31, 2022, Mr. Shree Kumar Bangur, Chairman & Managing Director, Mr. Saurabh Bangur, Joint Managing Director, Mr. Mukesh Jain, Director - Commercial and Mr. Aravind Matta, Company Secretary & Vice President (Corporate Affairs) are the Key Managerial Personnel of the Company.

The Board at the Meeting held on May 5, 2022 has appointed Mr. Mukesh Jain as Chief Financial Officer effective May 5, 2022 and re-designated him as Director - Commercial & Chief Financial Officer.

e. Meetings of the Board

During the year under review, four Board meetings and four Audit Committee meetings were held. The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Companies Act, 2013. The details of the meetings held are given in the Corporate Governance Report forming part of this Report.

f. Performance Evaluation

Pursuant to the provisions of the Act and SEBI Listing Regulations, the Annual performance evaluation of Board, its Committees, Chairman & Managing Director, Joint Managing Director and Director – Commercial has been carried out based on various parameters.

A separate exercise for the financial year 2021-22 was carried out to evaluate the performance of all individual directors including Independent Directors who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interests of the Company and its minority shareholders etc.

g. Board Training and Induction

At the time of appointing a Director, a formal letter of appointment is given to him/her, which inter alia explains the role, function, duties and responsibilities expected of him/her as a Director of the Company. The Director is also explained in detail the compliances required from him/her under the Act, the SEBI Listing Regulations and other relevant Laws and Regulations. Details of Familiarization of Directors are disclosed on the Company's website www.andhrapaper.com.

h. Audit Committee

During the year, the Audit Committee has been reconstituted by replacing Mr. Shree Kumar Bangur with Mr. Saurabh Bangur as a Member of the Committee.

The Audit Committee as on March 31, 2022 comprised of Mr. Praveen P. Kadle as Chairman and Messrs Adhiraj Sarin, Arun Kumar Sureka and Saurabh Bangur as other Members. All the recommendations made by the Audit Committee were accepted by the Board.

Particulars of Employees

The information required pursuant to Section 197 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is provided in Annexure-3. Having regard to the provisions of the second proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. If any Member is interested in obtaining information on Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, such Member may, write to the Company Secretary at the Registered Office in this regard or can inspect the related documents/information at the Registered Office of the Company.

Vigil/Whistle Mechanism

The Company has adopted Whistle Blower Policy to deal with instance of fraud or any unethical or improper practices. A copy of this Policy is placed on the Company's website www.andhrapaper.com.

Internal Financial Controls

The Company established internal financial control(s) commensurate with the size, scale and complexity of the operations. Internal audit function is being handled by a professional firm of chartered accountants. The main function of Internal Audit is to monitor and evaluate adequacy of internal control system in the Company, its compliance with the operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners take corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions are reported to the Audit Committee.

Statutory Auditors audited the Internal Financial Controls (IFC) over financial reporting of the Company as of March 31, 2022 in conjunction with audit of the financial statements of the Company for the year ended on that date. Unmodified opinion on IFC was given by them.

Statutory Auditors

The Report of Auditors for the fiscal year 2022 does not have any qualifications, reservations or adverse remarks. The Report is enclosed with the financial statements in this Annual Report.

The Members of the Company at the 55th Annual General Meeting held on August 1, 2019 re-appointed Messrs Deloitte Haskins & Sells, Chartered Accountants, Statutory Auditors of the Company for a second term of three years to hold office from the conclusion of 55th Annual General Meeting till the conclusion of the ensuing 58th Annual General Meeting.

Messrs Deloitte Haskins & Sells, Chartered Accountants, Statutory Auditors of the Company are completing their second term at the ensuing AGM and are not eligible for re-appointment. The Board at its Meeting held on May 5, 2022 considered the recommendation of Audit Committee and recommended to the Members, the appointment of Messrs MSKA & Associates, Chartered Accountants, as Statutory Auditors of the Company in place of retiring auditors, for a term of five years, to hold office from the conclusion of 58th Annual General Meeting till the conclusion of 63rd Annual General Meeting corresponding to the financial years from 2022-23 to 2026-27.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Messrs D. Hanumanta Raju & Co., a firm of Company Secretaries to undertake the secretarial audit of the Company for the financial year 2021-22. Secretarial Audit Report under Section 204(1) of the Act issued by Messrs D. Hanumanta Raju & Co., Practicing Company Secretaries, in respect of financial year 2021-22 is attached as Annexure - 4 to this Report.

The Report of Secretarial Auditors does not have any qualifications, reservations or adverse remarks.

Cost Auditors

In terms of Section 148 of the Act read with the Companies (Audit & Auditors) Rules, 2014, the Board at their Meeting held on May 5, 2022, on the recommendation of Audit Committee, appointed M/s. Narasimha Murthy & Co., Cost Accountants as Cost Auditors of the Company for the financial year 2022-23, at a remuneration of Rs.4.00 lakhs (excluding applicable taxes) plus reimbursement of out-of-pocket expenses and their remuneration is being submitted for ratification by the Members at the forthcoming Annual General Meeting.

Cost Accounting Records and Cost Audit

Cost accounting records for the financial year under review were maintained as per the Companies (Cost Records and Audit) Rules, 2014. M/s. Narasimha Murthy & Co., Cost Accountants were appointed as Cost Auditors of the Company to audit the Cost Records for the year ended March 31, 2021. The Cost Audit Report for the financial year ended March 31, 2021 was filed with the Ministry of Corporate Affairs in August, 2021.

The Cost Audit Report for the year ended March 31, 2022 will be filed within the due date.

Public Deposits

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

Particulars of loans, guarantees, security or investments

The particulars of loans, guarantees, securities and investments covered under the provisions of Section 186 of the Act have been disclosed in the financial statements.

Subsidiary Company

The Company made an investment of Rs.5.00 lakhs by way of share capital in Andhra Paper Foundation ("Foundation"), incorporated under Section 25 of the Companies Act, 1956, wherein the excess of income over expenditure will be applied for promoting its objectives. Accordingly, the accounts of Andhra Paper Foundation were not consolidated, since the holding Company will not derive any economic benefit from its investment in Foundation.

The Company undertakes that annual accounts of Foundation and the related information will be made available to the members of holding company seeking such information at any point of time. The annual accounts of Foundation are placed on the Company's website www.andhrapaper.com and are also available for inspection by any member at the Registered Office of the Company during business hours on all working days of the Company. A statement containing salient features of the financial statement of Foundation for the financial year ended March 31, 2022 is attached as Annexure - 5 to this Report.

Annual Return

In terms of Section 92(3) of the Act, the Annual Return for the financial year ended March 31, 2022 is displayed on the website of the Company https://www.andhrapaper.com/index.html.

Business Responsibility Report (‘BRR')

Pursuant to Regulation 34 of the SEBI Listing Regulations, ‘Business Responsibility Report' forms part of this Report as Annexure - 6, which describes the initiatives taken by the Company from an environmental, social and governance perspective.

Material changes and commitments affecting the financial position of the Company which occurred between end of financial year and date of the Report

There were no material changes and commitments affecting the financial position of the Company which occurred between end of financial year and date of the Report.

Directors' Responsibility Statement

The Board of Directors hereby confirms and declares that:

• in the preparation of final accounts for the year ended March 31, 2022 the applicable accounting standards had been followed;

• they had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the financial year end March 31, 2022 and of the profit and loss of the Company for the year;

• they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• they had prepared the accounts for the year ended March 31, 2022 on a ‘going concern' basis;

• they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

• they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


• During the year under review, the Chairman & Managing Director of the Company has not received any remuneration or commission from the subsidiary company.

• There were no significant material orders passed by the regulators or courts or tribunals which would impact the going concern status of the Company and its future operations.

• During the year under review, neither the statutory auditors nor the secretarial auditor has reported to the audit committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees.

• The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All women employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year, no complaints were received by the Company under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

• The Company has complied with all the applicable laws, rules, regulations and Secretarial Standards.

• All Policies as required under the Act or the SEBI Listing Regulations are available on the website of the Company www.andhrapaper.com.


The Board of Directors wish to place on record their gratitude to the Central Government, Government of Andhra Pradesh, Government of Telangana and Banks for their continued support during the year.

The Board of Directors wish to convey their thanks to the valued customers and dealers for their continued patronage and place on record their appreciation of the contribution made by all the employees during the year under review.

For and on behalf of the Board
Place: Rajahmundry Shree Kumar Bangur
Date: June 22, 2022 Chairman & Managing Director