Dear Members, Metro Brands Limited
Your Directors are pleased to present the 46th (Forty-sixth) Annual
Report together with the Audited Financial Statements, prepared in compliance with Indian
Accounting Standards of Metro Brands Limited (your Company') for the Financial
Year (FY) ended March 31, 2023.
1. FINANCIAL HIGHLIGHTS & PERFORMANCE SUMMARY
The standalone and consolidated Financial Statements for the FY ended
March 31, 2023, forming part of this Annual Report, have been prepared in accordance with
the Indian Accounting Standards (hereinafter referred to as "Ind AS") prescribed
under Section 133 of the Companies Act, 2013 ("Act") and other recognized
accounting practices and policies to the extent applicable. Necessary disclosures
regarding Ind-AS reporting have been made under the Notes to Financial Statements. The
Company's performance during the FY under review as compared to the previous FY is
summarized below:
(Rs in Lacs)
Particulars |
Standalone |
Consolidated |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Gross Sales |
240,887 |
1,53,712 |
249,544 |
1,57,464 |
Less: Taxes |
35,768 |
22,527 |
36,900 |
23,239 |
Sales (Net of Tax) |
205,119 |
1,31,185 |
212,644 |
1,34,225 |
Profit before depreciation & Tax |
67,351 |
41,137 |
67,010 |
41,737 |
Less: Depreciation & amortisation |
17,522 |
13,383 |
18,101 |
13,424 |
Profit Before Tax |
49,830 |
27,754 |
48,909 |
28,314 |
Less: Provision for tax |
13,565 |
7,526 |
13,685 |
7,525 |
Less: Deferred Tax Liability |
(1,083) |
(590) |
(1,132) |
(562) |
Less: Tax pertaining to earlier years |
30 |
55 |
21 |
55 |
Add: Share of profit of Joint Venture |
- |
- |
203 |
124 |
Profit After Tax |
37,318 |
20,764 |
36,539 |
21,420 |
Add/ (Less): Other comprehensive income/(Loss) (net of taxes) |
(164) |
51 |
(194) |
41 |
Total Comprehensive Income |
37,153 |
20,815 |
36,344 |
21,460 |
Less: Total Comprehensive Income attributable to
Non-Controlling Interest |
- |
- |
395 |
258 |
Total Comprehensive Income attributable to Owners of the
Company |
37,153 |
20,815 |
35,949 |
21,202 |
Standalone Financial Results
Your Company has a strong track record of revenue growth and
profitability. During the FY 2022-23, your Company recorded the Gross Turnover of
2,408.87 Crore representing a growth of 56.71% as compared to Gross Turnover of 1,537.12
Crore during the previous FY.
The Profit before Tax increased by 79.54% to 498.30 Crore during FY
2022-23 as compared to 277.54 Crore in the previous FY. The Profit after Tax was higher
at 371.53 Crore compared to 208.15 Crore in the previous FY, representing a growth of
78.49%.
Consolidated Financial Results
During the FY 2022-23, the Company recorded Gross Turnover of
2,495.44 Crore as against the Gross Turnover of 1,574.64 Crore during the previous FY,
representing an increase of 58.48%.
The Profit before Tax was 489.09 Crore compared to 283.14 Crore in
the previous FY, higher by 72.74%. The Profit after Tax was higher at 365.39 Crore
compared to 214.20 Crore in the previous FY, representing a growth of 70.58%.
Your Company marked its presence in Top 200 Listed Companies
This FY has been a time of revival after the challenges posed by the
Covid pandemic. As everyone adjusted to the new normal', our business and
customers experienced a significant technology, your Company became more data and digital
driven. Today, your Company stands and as a more consistent, competitive, profitable,
responsible organization, which has resulted in our market capitalization placing us among
the Top 200 Companies in the market during the reviewed FY.
According to the market capitalization list released by the National
Stock Exchange of India Limited (NSE) and BSE Limited (BSE), your Company's ranking
is 199 and 200, respectively, as of March 31, 2023. This achievement reflects our team in
navigating through these unprecedented times and emerging stronger in the market.
2. SIGNIFICANT ACTIVITIES AND DEVELOPMENTS
(i) Acquisition of Metro Athleisure Limited (formerly known as Cravatex
Brands Limited) ("MAL")
Your Company has acquired 100% stake in MAL w.e.f. December 1, 2023.
Consequently, it became a wholly owned subsidiary of the Company from the aforesaid date.
MAL holds exclusive long-term license for the Italian sportswear brand
FILA & owns the Indian sportswear brand Proline. This acquisition fits the strategic
vision of the Company to expand its presence in the sports and athleisure space in India.
Your Company looks forward to elevating the sportswear landscape in India and address
significant white space in its product portfolio as of date. In addition, your Company
will also be able to leverage sales across all formats i.e. Exclusive Brand Stores, Multi
Brand Stores, Airport Stores, Distribution, Online Marketplaces and Webstores for these
brands.
With an intention to leverage costs, operational synergies and focused
management approach for pursuing revenue growth and value unlocking for improved cash
flows, the Board of Directors in their meeting held on March 23, 2023, approved the Scheme
of Arrangement between MAL and the Company for demerger of "FILA business" into
the business of the Company. The same is pending at National Company Law Tribunal, Mumbai
for approval.
(ii) Investment in Thaely Private Limited:
As part of the Company's commitment to promoting sustainable
footwear, your Company has made an investment in Thaely Private Limited
(Thaely'), acquiring Compulsory Convertible Preference Shares resulting into
approximately 2.72% of its Share Capital on a fully diluted basis in the first tranche of
investment. Your Company intends to acquire an overall approximate 5.02% of Thaely's
share capital on a fully diluted basis, subject to fulfillment of the conditions as per
the agreement entered into with Thaely. efforts and adaptability of True to its name,
"Thaely" is a brand that creates sneakers using waste plastic bags, which are
transformed into a strong and flexiblefabric known as ThealyTex, resembling leather.
Thaely is actively engaged in marketing and selling sustainable sneaker shoes not only in
the United States and Europe but also in Dubai, India, and several other countries.
3. THE STATE OF THE COMPANY'S AFFAIRS AND BUSINESS
OPERATIONS
During FY 2022-23, your Company continued its expansion plan and opened
144 new stores including relocation of 13 existing stores. The total number of stores
reached 739 at the end of the FY.
Your Company prioritizes its customers, maintaining a strong
customer-centric approach, and offers loyalty programs such as Club Metro, My Mochi, and
Crocs Club. These loyalty programs have provided valuable insights into customer
preferences and trends over the years, enabling the Company to customize its product
offerings accordingly. Continuous innovation in products remains a key strategy to attract
and retain customers, contributing to the Company's overall success.
Furthermore, your Company has experienced robust growth in ecommerce
sales, successfully transforming into an omni-channel footwear retailer. In the fiscal
year, ecommerce sales, including omni-channel sales, reached 162 Crore, showcasing a
remarkable 48% year-on-year growth. The momentum in online sales, including omni-channel,
continues to be strong. In FY 2022-23, online sales (including omni-channel) accounted for
7.9% of the overall sales, as compared to 2.5% in FY 2019-20, 7.3% in FY 2020-21, and 8.4%
in FY 2021-22. This shift demonstrates the Company's adaptability to changing
consumer behavior and its ability to embrace modern retail trends.
4. UTILIZATION OF PROCEEDS OF INITIAL PUBLIC OFFERING
("IPO")
Pursuant to Regulation 32 of the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time
to time, ("SEBI Listing Regulations"), a statement in the use of proceeds of IPO
is herein given below:
Particulars of Issue |
Shares Issued |
Amount Raised |
Deviation(s) or Variation(s) in the use of proceeds of
issue if any |
IPO |
59,00,000 equity shares of face value of 5/- (Rupees five
only) each by way of fresh issue through IPO of the Company. |
295 Crores only |
There were no instances of deviation(s) or variation(s) in
the utilization of proceeds as mentioned in the objects stated in the Prospectus dated
December 15, 2021 in respect of the IPO issue of the Company. |
The proceeds of IPO were utilized for the objects as disclosed in the
Prospectus, the details are mentioned as below:
(Rs in Crore)
Sl. No. Name and brief description of the Object |
Amount as proposed in Offer Document () |
Amount utilized () |
Total unutilized Amount () |
1. Expenditure for the New Stores |
225.37 |
85.60 |
139.77 |
2. General Corporate Purposes |
61.94 |
61.94 |
- |
Total |
287.31 |
147.54 |
139.77 |
5. METRO STOCK OPTION PLAN 2008 (ESOP 2008):
ESOP 2008 is administered by the Nomination,
Remuneration and Compensation ("NRC") Committee and is in
compliance with the Act and the Securities and Exchange Board of India (Share Based
Employee Benefits and Sweat Equity) Regulations, 2021 ("SEBI SBEB Regulations").
During the FY under review, there has been no material changes in the ESOP 2008.
In September 2021, the Company granted 18.78 Lacs options to eligible
Employees. Building on this, during FY, your Company has granted an additional 2.93 Lacs
options. These options entitle the grantees to exercise one Equity share of 5/- each for
every option exercised.
The total number of options granted now accounts for approximately
0.80% of the total equity capital.
This move reflects the Company's commitment to recognizing and
rewarding its Employees' contributions while aligning their interests with the
Company's growth and success.
During the FY under review, 225,795 Equity shares of 5 each were
exercised and allotted under the ESOP 2008. The disclosure required pursuant to clause
14 of the SEBI SBEB Regulations is uploaded on the website of the
Company at https://metrobrands.com/
wp-content/uploads/2023/06/ESOP-details-Website-V3_02062023-Clean.pdf
6. SHARE CAPITAL
As on March 31, 2023, the Authorised Equity Share Capital of the
Company was 1,50,00,00,000 comprising of 30,00,00,000 Equity Shares of 5 each; and the
Paid-up Equity Share Capital of the Company was 1,358,666,105 comprising of 271,733,221
Equity Shares of 5 each.
After the end of the FY under review, the Company has allotted 1,835
Equity Shares of 5 each upon exercise of ESOP options. As on date, the Paid-up Capital
of the Company is 1,358,675,280 comprising of 271,735,056 Equity Shares of 5 each.
7. PUBLIC DEPOSITS
During the FY under review, your Company has not accepted any deposits
within the meaning of Section 73 and 76 of the Act read with Companies (Acceptance of
Deposits) Rules, 2014. As on March 31, 2023, there were no deposits lying unpaid or
unclaimed. As the Company has not accepted any deposit during the FY under review, there
is no non-compliance with the requirements of Chapter V of the Act.
8. DIVIDEND AND APPROPRIATIONS
The Board of Directors of your Company in its meeting held on January
17, 2023 had declared and paid an Interim Dividend of 2.50/- per Equity Share of the face
value of 5/- per share (50%). Keeping in view the strong performance, your Directors were
pleased to recommend a Final Dividend of 1.50/-per Equity Share of face value 5/- per
Equity Share (30%) for the FY 2022-23 in its Meeting held on May 23, 2023. Total Dividend
payout for the FY 2022-23 would be 30%, which is the same level as previous FY. The
Dividend declared and paid / proposed to be declared during the FY is in accordance with
the Dividend Distribution Policy, as approved and adopted by the Board of Directors of the
Company and dividend will be paid out of the profits for the FY. Total Dividend payment
for FY 2022-23 would be 108.69 Crores.
As per Regulation 43A of the SEBI Listing Regulations, the Company has
a Dividend Distribution Policy duly approved by the Board. The policy is available on the
Company's website and can be accessed at https://
metrobrands.com/wp-content/uploads/2022/03/Dividend-Distribution-Policy_Metro-Brands-Ltd.-BM-dtd-070322.pdf
Based on the guidelines outlined in the Dividend Distribution Policy,
the Board has recommended the dividend for the FY 2022-23.
9. TRANSFER TO RESERVES
The Board of Directors of your Company have decided to not transfer any
amount to the reserves for the FY under review.
10. FINANCE
Your Company has been financing its operations and expansions through
internal accruals. Your Company retained highest credit rating A1+ for short term and AA
for long term by CARE, a leading rating agency.
Details of the same are provided in the Corporate Governance Report.
11. MATERIAL CHANGES AND COMMITMENT IF ANY, AFFECTING FINANCIAL
POSITION OF THE COMPANY FROM THE END OF THE FY TILL THE DATE OF THIS REPORT
There has been no material change in commitment, affecting the
financial performance of the Company which occurred between the end of the FY of the
Company to which the financial statements relate and the date of this Report.
12. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report for the FY under review,
as stipulated under Regulation 34(2)(e) of the SEBI Listing Regulations, forms part of the
Annual Report.
13. SUBSIDIARIES AND ASSOCIATE COMPANY
(i) MAL
On December 1, 2022, your Company acquired 100% equity share capital,
optionally convertible debentures and compulsorily convertible preference shares of MAL.
During the four-month period under review, MAL has reported Gross Sales of 36.95 Crores
and loss after tax of 24.16 Crores.
Pursuant to Section 129(3) of the Act, read with Rule 5 of the
Companies (Account) Rules, 2014 a separate statement containing the salient features of
the financial statement of MAL in the prescribed format AOC - 1 is attached as Annexure
- 4 to this Report.
The Audited Consolidated Financials of your Company for the FY ended
March 31, 2023 prepared in compliance with the provisions of IND AS 27 issued by the
Institute of Chartered Accountants of India and notified by the Ministry of Corporate
Affairs (MCA), Government of also forms part of this Annual Report.
Further, pursuant to the provisions of Section 136 of the Act, the
standalone and consolidated financial statements of the Company and separate audited
financial statements in respect of wholly owned subsidiary, are available on the website
of the Company at https://metrobrands.com/ group-company/.
After the end of FY under review, the name of the wholly owned
subsidiary was changed from Cravatex Brands Limited to Metro Athleisure Limited pursuant
to the Certificate dated July 14, 2023.
(ii) Metmill Footwear Private Limited
Metmill Footwear Private Limited ("Metmill"), a 51%
subsidiary of your Company, was incorporated on September 16, 2009, and currently has a
paid-up capital of 1,25,00,000/- (Rupees One Crore Twenty-Five Lacs only). In the FY
under review, Metmill has achieved commendable results, with Gross Sales reaching 54.02
Crores, marking an impressive growth of 28.37% compared to the previous FY. Furthermore,
the Profitafter Tax for the same period stands at 7.89 Crores, representing a substantial
increase of 79.32% compared to the previous FY.
Pursuant to Section 129(3) of the Act, read with Officer
(CEO),ChiefFinancial Rule 5 of the Companies (Account) Rules, 2014 a separate statement
containing the salient features of the financial statement of Metmill in the prescribed
format, AOC - 1 is attached as Annexure - 4 to this Report.
The Audited Consolidated Financials of your Company for the FY ended
March 31, 2023 prepared in compliance with the provisions of IND AS 27 issued by the
Institute of Chartered Accountants of India and notified by the MCA also forms part of
this Annual Report.
Further, pursuant to the provisions of Section 136 of the Act, the
standalone and consolidated financial statements of the Company and separate audited
financial statements in respect of subsidiary, are available on the website of the Company
at https://metrobrands.com/ group-company/
The Company's policy on determining the material subsidiaries, as
approved by the Board is uploaded on the Company's website at https://metrobrands.
com/wp-content/uploads/2022/07/Policy-on-Material-Subsidiary-Final-ver-dtd-07032022-1.pdf
(iii) M.V. Shoe Care Private Limited
M.V. Shoe Care Private Limited ("MVSC") is an Associate
Company in which your Company holds 49% of Equity Shares. For the FY under review, MVSC
has reported impressive Gross Sales of 48.32 Crores, reflectinga substantial increase of
86.64% compared to the previous FY. Additionally, the Profit after Tax for the same period
has shown remarkable growth, amounting to 4.85 Crores, indicating a significant increase
of 136.34% compared to the previous FY.
Pursuant to Section 129(3) of the Act, read with Rule 5 of the
Companies (Account) Rules, 2014, a separate statement containing the salient features of
the financial statement of MVSC in the prescribed format, AOC - 1 is attached as Annexure
- 4 to this Report.
During the FY under review, there were no companies which has
become/ceased to become an Associate Company / Joint Venture.
14. BOARD OF DIRECTORS
Your Company's governance structure is multi-tiered, comprising
the Board of Directors, Board Committees, the Managing Director (MD), Chief Executive
Officer Executive Committee.
The Board holds a strong commitment to upholding sound principles of
Corporate Governance within the Company. Its primary responsibility lies in overseeing how
the management serves the short and long-term interests of Shareholders and other
stakeholders. During its meetings, the Board deliberates and makes decisions on strategic
issues, including policy reviews, financial matters, discussions on business performance,
and other critical aspects for the Company. It receives able support from the Board
Committees, the CEO and MD.
The Committees established by the Board are dedicated to specific areas
of focus, taking informed decisions within their delegated authority and responsibilities.
These Committees provide specific recommendations to the Board
regarding matters under their purview.
Subsequently, the decisions and recommendations of the Committees are
presented before the Board for careful consideration and approval, as required.
The Board of the Company is duly constituted with proper balance of
Executive Directors, Non-Executive Non-Independent Director and Non-Executive Independent
Directors including Women Director in accordance with the provisions of Act and Regulation
17 of SEBI Listing Regulations. All the Directors possess extensive experience and
specialized knowledge in various sectors, encompassing law, finance, accountancy, and
other relevant areas.
As on March 31, 2023, the Board of your Company consists of nine (9)
Directors as follows:
Executive Directors |
1. Mr. Rafique Abdul Malik (DIN: 00521563), |
2. Ms. Farah Malik Bhanji (DIN:00530676), |
3. Mr. Mohammed Iqbal Hasanally Dossani (DIN:08908594) |
Non-Executive Directors: |
Non-Independent Director (Nominee Director) |
1. Mr. Utpal Hemendra Sheth (DIN:00081012) |
Independent Directors |
2. Mr. Manoj Kumar Maheshwari (DIN:00012341), |
3. Ms. Aruna Bhagwan Advani (DIN:00029256), |
4. Mr. Arvind Kumar Singhal (DIN:00709084), |
5. Mr. Vikas Vijaykumar Khemani (DIN:00065941), |
6. Mr. Srikanth Velamakanni (DIN:01722758) |
The Chairman of the Company is an Executive Director.
Mr. Mohammed Iqbal Hasanally Dossani (DIN: 08908594), retires by
rotation at the ensuing Annual General Meeting and being eligible offers himself for
re-appointment.
Considering the integrity, relevant knowledge, expertise, and
experience, as well as the contribution made by Mr. Vikas Vijaykumar Khemani (DIN:
00065941) during his current tenure as an Independent Director, the Board of Directors
proposed re-appointment of Mr. Khemani as an Independent Director of the Company for a
further period of five (5) consecutive years, on the expiry of hiscurrentterm office, i.e.,
from March 12, 2024 to March 11, 2029, witheffect subject to Shareholders' approval.
The Company has received the necessary declaration from Mr. Khemani that he continues to
fulfil the criteria of independence as prescribed under the relevant provisions of the Act
and the SEBI Listing Regulations.
The Board recommends their re-appointment for approval of the Members
and the same forms part of the notice of the ensuing Annual General Meeting. The
information about the Directors seeking their re-appointment as stipulated under Para
1.2.5 of Secretarial Standards on General Meetings and Regulation 36 of the SEBI Listing
Regulations has been given in the notice convening the Annual General Meeting.
None of the Directors of the Company have incurred any disqualification
under Section 164(2) of the Act read with Rule 14(1) of the Companies (Appointment and
Qualification of Directors) Rules, 2014. All the Directors have confirmed that they are
not debarred from accessing the capital market as well as from holding the office of
Director pursuant to any order of Securities and Exchange Board of India or MCA or any
other such regulatory authority. In view of the Board, all the Directors possess the
requisite skills, expertise, integrity, competence, as well as experience considered to be
vital for business growth.
The composition of Board of Directors and detailed analysis of various
skills, qualifications, and attributes as required and available with the Board has been
presented in the Corporate Governance Report which forms part of the Annual Report.
15. KEY MANAGERIAL PERSONNEL (KMP'): |
Pursuant to the provisions of Section 203 of the Act, the KMP of the
Company as on March 31, 2023, are: |
1. Mr. Rafique Abdul Malik, Chairman |
2. Ms. Farah Malik Bhanji, Managing Director |
3. Mr. Mohammed Iqbal Hasanally Dossani, Whole Time Director |
4. Mr. Nissan Joseph, Chief Executive |
5. Mr. Kaushal Khodidas Parekh, Chief Financial Officer |
6. Ms. Deepa Sood, VP-Legal, Company Secretary & Officer Compliance |
7. Ms. Alisha Rafique Malik, President (E-commerce and CRM) |
During the FY, there were no changes in the KMP of the Company. |
16. SENIOR MANAGEMENT PERSONNEL (SMP')
Pursuant to the provisions of Regulation 34, read with Schedule V of
SEBI Listing Regulations, as amended, the list of the SMP of the Company as on March 31,
2023, along with the changes therein since end of the previous FY are provided in the
Corporate Governance Report, which forms part of the Annual Report.
17. DECLARATION BY INDEPENDENT DIRECTORS
There are five Independent Directors on the Board of the Company. Your
Company has received declarations from all the Independent Directors confirming that:
n they meet the criteria of independence as prescribed under
Section 149(6) and Schedule
IV of the Act and Regulation 16 of the SEBI Listing Regulations. There
has been no change in the circumstances affecting Independent Directors of the Company;
n they have complied with the Code for Independent Directors
prescribed under Schedule IV to the Act along with the Code of Conduct for Directors and
SMP formulated by the Company as per SEBI Listing Regulations; and
n they have registered their names in the databank of
Independent Directors as being maintained by the Indian Institute of Corporate Affairs in
terms of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014.
In the opinion of the Board, the Independent Directors possess the
requisite expertise and experience and are persons of high integrity and repute. They
fulfill the conditions specified in the Act, and the rules made thereunder and are
independent of the management.
None of the Independent Directors are aware of any circumstance or
situation, which exist or may be reasonably anticipated, that could impair or impact their
ability to discharge their duties with an objective independent judgment and without any
external influence. The Board of Directors have taken on record the declaration and
confirmation submitted by the Independent Directors after undertaking due assessment of
the same and in their opinion, the
Independent Directors fulfill the conditions in the Act and SEBI
Listing Regulations and are independent of the management.
18. NUMBER OF MEETINGS OF BOARD
The Board meets at regular intervals to discuss and decide on
Company/Business policy and strategy apart from other Board businesses. The Board and
Committee Meetings are pre-scheduled and a tentative annual calendar of the Board and
Committee Meetings is circulated to the Directors well in advance to facilitate them to
plan their schedule and to ensure meaningful participation in the Meetings. However, in
case of a special and urgent business need, the Board's approval is taken by passing
resolutions through circulation, as permitted by law, which are noted and confirmed in the
subsequent Board Meeting.
During the FY 2022-23, five (5) Board Meetings were held. The details
relating to Board Meetings and attendance of Directors in each Board Meeting held during
the FY 2022-23 has been separately provided in the Corporate Governance Report. status as
19. COMPANY'S POLICY ON APPOINTMENT AND REMUNERATION FOR
DIRECTORS, KMP AND SMP
The NRC Committee has devised a policy which is in accordance with the
Act and the SEBI Listing Regulations for selection, appointment and remuneration of
Directors, KMP and SMP. The Committee has also formulated the criteria for determining
qualifications, positive attributes, and independence of Directors. The Policy, inter
alia, covers the details of the remuneration of Directors, KMP and SMP, their performance
assessment and retention features.
The Policy aims to attract, retain, and motivate qualified people at
the Board and senior management levels and ensure that the interests of Board Members and
senior executives are aligned with the Company's vision and mission statements and
are in the long-term interests of the Company. The Policy can be accessed on the
Company's website at https://metrobrands.
com/wp-content/uploads/2023/04/MBL-Nomination-Remuneration-Compensation-Policy-Clean.pdf
20. ANNUAL GENERAL MEETING
The 45th Annual General Meeting of the Members of the Company was held
on September 7, 2022, through video conference/other audio-visual means in accordance with
various circulars issued by MCA specified and Securities and Exchange Board of India to
approve Financial Statements and other matters. All the Whole-time Directors were present
in the meeting.
21. PERFORMANCE EVALUATION OF THE INDIVIDUAL DIRECTORS, THE COMMITTEES
AND THE BOARD
In terms of the requirement of the Act and the SEBI Listing Regulations
and in consonance with the Guidance Note on Board Evaluation issued by SEBI and Policy for
Performance Evaluation of the Board of Directors, an annual performance evaluation of the
Board is undertaken where the Board formally assesses its own performance with the aim to
improve the effectiveness of the Board and the Committees.
The Board along with the NRC Committee has laid down the criteria of
performance evaluation of Board, its Committees and Individual Directors which is
available on the website of the Company at https://
metrobrands.com/wp-content/uploads/2023/01/ Performance-evaluation-policy.pdf
The Board, on the recommendation of the NRC Committee, carried out an
annual performance evaluation of the Board of Directors as a whole, Managing Director,
Whole Time Directors, Non- Executive and Independent Directors, Committees, and the
Chairman as per the evaluation reports placed at the meeting. The Board also carried
evaluation of the performance of its various Committees for the FY under consideration.
The performance evaluation of the Directors was carried out by the entire Board, other
than the Director being evaluated. The performance evaluation of the Chairman and the
Non-Independent Directors were carried out by the Independent Directors.
The evaluation methodology included techniques such as detailed
questionnaires covering various parameters relevant for the Board and Committees and
one-on-one discussion with the Directors. Separate exercise was carried out to evaluate
the performance of individual Directors on various parameters. The Directors expressed
their satisfaction over the evaluation process.
A separate meeting of the Independent Directors was held on February
28, 2023, without the attendance of non-independent Directors and Members of the
management. All the Independent Directors of the Company attended the said meeting.
22. INDEPENDENT DIRECTORS' INDUCTION AND FAMILIARIZATION
Appropriate familiarization programs and strategy discussions for
Directors is a major contributor in maintaining the high corporate governance standards of
the Company. These sessions provide a good understanding of the business to the Directors.
The management provides such information and training at the meetings of Board of
Directors and through other formal & informal meetings. The Independent Directors are
made aware of their roles and responsibilities at the time of their appointment and a
detailed letter of appointment is issued to them.
The details of such familiarization programmes for Independent
Directors are posted on website of the Company at https://metrobrands.com/wp-content/
uploads/2023/01/Details-of-Fam-Program-2023-Website-Uploading.pdf
23. COMMITTEES OF THE BOARD OF DIRECTORS
The Board Committees play a crucial role in the governance structure of
the Company and have been constituted to deal with specific areas / activities which
concern the Company and need a closer review. The constitution of the Board Committees is
in compliance with the provisions of the Act and the relevant rules made thereunder, SEBI
Listing Regulations and the Articles of Association of the Company.
There have been no instances during the FY where recommendations of the
Audit Committee were not accepted by the Board. The brief details of the composition of
the Committees, terms of reference, the number of meetings held and attendance of
Directors at such meetings are provided in the Corporate Governance Report, which forms
part of the Annual Report.
24. BUSINESS RESPONSIBILITY AND SUSTANINBILITY REPORT
The Business Responsibility and Sustainability Report for the FY under
review, as stipulated under Regulation 34(2) of the SEBI Listing Regulations, describing
the initiatives taken by your Company from Environmental, Social and Governance
perspective, forms an integral part of this Annual Report as Annexure - 6.
25. SECRETARIAL STANDARDS
The Company has devised proper systems to ensure compliance with the
provisions of all applicable Secretarial Standards issued by the Institute of Company
Secretaries of India and that such systems are adequate and operating effectively.
26. CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY
(CSR')
Your Company has adopted and formulated a Corporate Social
Responsibility and Sustainability Policy and has also constituted a Corporate Social
Responsibility and Sustainability Committee in compliance with the provisions of Section
135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules,
2014. It is committed to ensure the social wellbeing of the communities through its CSR
initiatives, in alignment with the Company's key priorities. The Policy is also
available on website of the Company at https://metrobrands.
com/wp-content/uploads/2022/05/Corporate-Social-Responsibility-Policy.pdf
The spirit of the Company's CSR projects is the Company's
tagline, "We Care". Everything your Company does is driven by this and the
Company's focus is to touch the lives of its stakeholders who are in need.
As part of the skilling initiative, your Company provide "On the
Job" training to unemployed and uneducated youth at its retail showrooms under the
Government of India sponsored National Apprenticeship Promotion Scheme. Through this
initiative your Company supported 243 trainees, thus enhancing their skills and making
them employable. TeamLease Skill University supports your Company in completing the
compliances of this project.
Environmental health and sustainability have also been the
Company's focus during the FY under review.
Footwear is difficult to decompose naturally. After normal use and
reuse, once discarded, they remain in landfills and oceans for 100s of years. Through the
Company's three implementing partners, the Company collected and processed 900 tons
i.e., 21 Lacs pairs of discarded footwear in an eco-friendly manner, which is almost 27.5%
of the fresh footwear pairs sold in the FY 2022-23.
Education and empowerment have always been your Company's focus
and the Company is happy to emphasize it in every way possible. With the Sociallab
Ventures Pvt Ltd, your Company is working to empower 150 Mumbai railway station based shoe
shiners by covering the aspects of their livelihood, healthcare and financial literacy
trainings.
Your Company's traditional CSR projects supported the education
costs of 72 underprivileged girls, through Fidai Girls Educational Institute and helped in
providing medical treatment to 82 needy people through Focus Humanitarian Assistance
India.
The brief outline of the CSR Policy of the Company and the initiatives
undertaken by the Company for the FY 2022-23, as required under Section 135 of the Act
read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014,
and Rule 9 of the Companies (Accounts) Rules, 2014, is attached to this report as Annexure
- 2.
27. RELATED PARTIES TRANSACTIONS
During the FY under review, all the transactions with related parties
are placed before the Audit Committee for its approval. An omnibus approval from the Audit
Committee is obtained for the related party transactions which are repetitive in nature.
All the transactions with related parties entered into during the FY under review were at
an arm's length basis and in the ordinary course of business and in accordance with
the provisions of the Act and the rules made thereunder, the SEBI Listing Regulations and
the Related Party Transactions policy of your Company. Your Company has not entered into
any transactions with related parties which could be considered material in terms of
Section 188 of the Act. Accordingly, the disclosure of related party transactions as
required under Section 134(3)(h) of the Act, in Form AOC 2, is not applicable.
The policy on related party transactions as approved by the Board can
be accessed on the Company's website https://metrobrands.com/wp-content/
uploads/2022/04/Related-Party-Transaction-Policy-. its pdf. The Policy intends to ensure
that proper reporting, approval and disclosure processes are in place for all transactions
between the Company and its related parties.
28. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The particulars of loans, guarantees and investments as per Section 186
of the Act by the Company, have been disclosed in the financial statements.
29. RISK MANAGEMENT
Your Company has an elaborate Risk Management procedure and has the
Risk Management Policy in place, to identify the risks including those which, in the
opinion of the Board, may threaten the existence of the Company, monitor the risks and
their mitigating actions.
Risk Management processes have been established across the Company and
are designed to identify, assess, and frame a response to threats that can adversely
affect the achievement of Company's objectives. Further, it is embedded across all
the major functions and revolves around the goals and objectives of the Company. The key
risks are also discussed at the Audit and Risk Management Committee and Board meetings.
The Board has set out a review process to report to the Board the progress on the action
plans for the major risks of the Company.
The Company has also formed a Risk Management Committee
(RMC') to monitor the existing risks as well as to formulate strategies for
identifying new and emergent risks. The RMC identifies the key risks for the Company,
develops and implements the risk mitigation plan, reviews, and monitors the risks and
corresponding mitigation plans on a regular basis and prioritizes the risks, if required,
depending upon theas effect on the business/reputation.
The Risk Management Policy is available on the website of the Company
at https://metrobrands.com/wp-content/uploads/2023/08/Risk-Management-Policy-1. pdf. The
other details in this regard are provided in the Corporate Governance Report, which forms
part of this Annual Report.
During the FY under review, Risk Officer of your Company reviewed risk
assessment of Company's operations in discussion with various stakeholders and
updated the Risk Register accordingly.
30. INTERNAL FINANCIAL CONTROLS AND SYSTEMS
According to Section 134(5) (e) of the Act, the term Internal
Financial Control' means the policies and procedures adopted by the Company for
ensuring the orderly and efficient conduct of its business, including adherence to the
Company's policies, the safeguarding of its assets, the prevention and early
detection of frauds and errors, the accuracy and completeness of the accounting records
and the timely preparation of reliable financial information.
Your Company's internal control systems are commensurate with the
nature of its business and the size and complexity of operations. These controls ensure
safeguarding of the assets of the Company and deviations, if any, are reported for
appropriate action.
Internal audit reports are discussed in the Audit Committee meetings to
review adequacy and effectiveness of your Company's internal control environment and
necessary action are taken to strengthen the control in the required areas of business
operations. The process is in place to monitor the implementation of audit
recommendations, including those relating to strengthening of your Company's risk
management policies and systems. The control criteria ensure the orderly and efficient
conduct of the Company's business, including adherence to its policies, the
safeguarding of its assets, the prevention and detection of frauds and errors, the
accuracy and completeness of the accounting records and the timely preparation of reliable
financial information.
Based on the assessment carried out by the Management and the
evaluation of the results of the assessment, the Board of Directors are of the opinion
that the Company has adequate Internal Financial at Controls system that is operating
effectively March 31, 2023.
Except one instance of misappropriation of stocks of the Company for
personal gains by two Employees of the Company, which was duly intimated to the Stock
Exchanges, there were no instances of fraud or material misstatement to the Company's
operations which required the Statutory Auditors to report to the Audit Committee and / or
to the Board as required under Section 143(12) of the Act and the rules made thereunder.
31. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance for sexual harassment at workplace and
has in place a Policy for Prevention of Sexual Harassment at workplace in line with the
requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition
& Redressal) Act, 2013 (POSH Act').
The Policy aims to provide protection to Employees at workplace and
prevent and redress complaints of sexual harassment and for matters connected or
incidental thereto, with the objective to create a healthy working environment that
enables Employees to work without fear of prejudice, gender bias and sexual harassment.
During the FY under review, Internal Complaints Committee (ICC) has been reconstituted to
redress complaints received regarding sexual harassment.
The Policy ensures that all Employees, including those on deputation,
temporary, part-time, and others working as consultants or on contract, are covered and
protected under its provisions. The Policy extends its safeguards to all individuals
associated with the Company in various capacities. During the FY under review, the Company
received one complaint related to sexual harassment. The Company took this complaint
seriously and conducted a thorough investigation in accordance with the provisions of the
POSH Act. Following the completion of the investigation and as per the requirements of the
Act, the case was appropriately closed.
To build awareness in this area, the Company has been conducting
induction/ refresher programmes in the organisation on a continuous basis. During the FY,
your Company organised offline training sessions on POSH Policy of the Company sensitizing
the provisions of the POSH Act to all the Employees of the Company.
32. EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) and Section 92(3) of
the Act and Rule 12 of the Companies (Management and Administration) Rules 2014, the
Annual Return will be uploaded on the website of the Company for the FY 2022-23 and the
same will be available at https://metrobrands.com/annual-return/
33. AUDITORS
Statutory Auditors:
At the 45th Annual General Meeting (AGM') held on September
7, 2022, the Members approved the appointment of M/s. S R B C & CO LLP, Chartered
Accountants, (FRN: 324982E/E300003) as Statutory Auditors of the Company to hold office of
five years from the conclusion of that AGM till the conclusion of the 50th AGM.
M/s. S R B C & CO LLP is a firm of Chartered Accountants registered
with the Institute of Chartered Accountants of India. It is primarily engaged in providing
audit and assurance related services to the clients. It is a Limited Liability Partnership
Firm incorporated in India with its at 22, Camac Street, 3 registeredoffice rd Floor,
Block B', Kolkata. The firm is part of M/s. S.R. Batliboi & Affiliates
network of audit firms.
Internal Auditor:
M/s. Aneja Assurance Private Limited (Chartered Accountants) (CIN:
U74999MH2008PTC185702), were re-appointed as the Internal Auditors of the Company for the
FY 2022-23 in the Board Meeting held on July 29, 2022, in accordance with the provisions
of Section 138 of the Act read with the Companies (Accounts) Rules, 2014. The auditors
have carried out internal audit during the FY 2022-23. Their reports were reviewed by the
Audit Committee.
After reviewing the qualifications and experience of various Internal
Auditors to commensurate with the size and requirement of the Company, the Audit Committee
and the Board of Directors in its meeting held on March 23, 2023 appointed M/s. KPMG
Assurance and Consulting Services LLP as the Internal Auditor, in accordance with the
provisions of Section 138 of the Act read with the Companies (Accounts) Rules, 2014, for
the period of one year with effect from the June 19, 2023 for the FY 2023-24 as per scope
provided by the Board and the Audit Committee.
Secretarial Auditor:
Pursuant to the provisions of Section 204 of the Act read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, CS A. Sekar,
Practicing Company Secretary (COP No. 2450) was re-appointed by the Board of Directors at
its meeting held on January 17, 2023 as the Secretarial Auditors of the Company for the FY
2022-23.
34. AUDITORS REPORT
(i) Statutory Audit Report:
The Auditors' Report prepared by the Statutory Auditors both in
respect of Standalone Financial Statement and Consolidated Financial Statement of the
Company for the FY ended March 31, 2023for a period does not contain any qualification,
reservation, adverse remark or disclaimer.
(ii) Secretarial Audit Report:
The Secretarial Audit Report issued by CS A Sekar does not contain any
qualification, reservation or adverse remark or disclaimer. The Secretarial Audit Report
in form MR-3 forms part of the annexures to this Directors' Report as Annexure - 5.
Pursuant to provisions of Section 143 (12) of the Act, the Statutory
Auditors and the Secretarial Auditor have not reported any incident of fraud to the Audit
Committee or Central Government during the FY under review.
(iii) Annual Secretarial Compliance Audit Report:
Pursuant to the provisions of Regulation 24A of SEBI Listing
Regulations, the Company has undertaken an audit for the FY 2022-23 for all applicable
compliances as per SEBI Rules, Regulations, Circulars, Notifications, Guidelines etc.
issued thereunder. The Annual Secretarial Compliance Audit Report issued by CS A. Sekar,
Practicing Company Secretary (COP No. 2450) has been duly submitted to the Stock Exchanges
within the prescribed time and also uploaded on our website
https://metrobrands.com/wp-content/uploads/2023/05/Reg24AFiling.pdf
35. COST AUDIT
As per Section 148 of the Act read with the Companies (Cost Records and
Audit) Rules, 2014, your Company is not required to include cost records in their books of
account and get its cost accounting records audited by a Cost Accountant and submit a
compliance report in the prescribed form.
36. COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD MEETINGS AND GENERAL
MEETINGS
The Company has complied with all the applicable provisions of
Secretarial Standards issued by the Institute of Company Secretaries of India and notified
by MCA.
37. PARTICULARS OF EMPLOYEES
The information required under Section 197(12) of the Act read with
Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 as amended from time to time in respect of Directors/Employees of the Company. The
statement containing information forming part of this Directors Report is provided in the Annexure
1 to this Report.
The information required under Section 197(12) of the Act read with
Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, as amended from time-to-time, forms part in the Annexure 1.
38. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information required under Section 134(3)(m) of the Act, read with
Rule 8 of the Companies (Accounts) Rules, 2014 for conservation of energy, technology
absorption, foreign exchange earnings and outgo is provided as Annexure - 3 to this
Report.
39. INSIDER TRADING CODE OF CONDUCT
Your Company has adopted a Code of Conduct to regulate, monitor and
report trading by designated persons of the Company and their immediate relatives and to
formulate a framework and policy for disclosure of events and occurrences that could
impact price discovery in the market for its securities as per the requirements under
SEBI(Prohibition of Insider Trading) Regulations, 2015. The Company has put in place a
mechanism for monitoring the trades done by designated persons of the Company and their
immediate relatives as well as generation of system based disclosures in line with the
Code of Conduct on Insider Trading. The details of dealing in the Company's shares by
designated persons are placed before the Audit Committee for information on quarterly
basis. The Code of Conduct has been made available on the Company's website at
https://metrobrands.com/wp-content/uploads/2023/04/MBL-Insider-Trading-Policy_
clean-copy.pdf
40. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy and established the
necessary vigil mechanism for Directors and Employees in confirmation with Section 177(9)
of the Act and Regulation 22 of SEBI Listing Regulations, to report concerns about
unethical behavior, or actual or suspected fraud, any other malpractice, impropriety or
wrongdoings, illegality, non-compliance of legal and regulatory requirements, retaliation
against the directors and Employees, and instances of leakage of/suspected leakage of
Unpublished Price Sensitive Information of the Company or violation of the Company's
Code of Conduct or Ethics Policy.
The Policy implemented by the Company aims to protect Employees and
Directors from any form of victimization when they raise concerns about potential
violations of legal or regulatory requirements, as well as any instances of incorrect or
misrepresented financial statements and reports. It ensures adequate safeguards are in
place for those who come forward with such concerns.
Employees of the Company are provided with the right and option to
report their concerns or grievances to the Chairperson of the Audit Committee,
particularly in appropriate or exceptional cases. To ensure widespread awareness,
information about these reporting channels is communicated to Employees during their
mandatory training modules at the time or material orders which of joining the Company.
The functioning of this reporting mechanism is overseen by the Audit
Committee, which ensures its effectiveness and proper implementation. No personnel were
denied access to the Audit Committee during the FY under review, reflecting the
Company's commitment to providing a safe and supportive environment for reporting
concerns.
The details of this Policy are explained in the Corporate Governance
Report which forms a part of this Annual Report and available at the website of the
Company at https://metrobrands.com/wp-content/
uploads/2022/06/Vigil-Mechanism_Whistle-Blower- Policy-Final-BM-dtd-07032022.pdf
There were three instances of such reporting during the FY ended March
31, 2023, which was duly reported to the Board and Audit Committee and resolved during the
said FY.
41. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Act, the Board of Directors of your
Company confirm that,
a) in the preparation of the annual accounts for the FY ended March 31,
2023, the applicable accounting standards had been followed.
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 your Company as on March 31, 2023 and
of the profits of your Company for the period ended March 31, 2023.
c) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding
the assets of your Company and for preventing and detecting fraud and other
irregularities.
d) the Directors had prepared the annual accounts for the period ended
March 31, 2023 on a "going concern" basis.
e) they have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
42. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant passed by the Regulators or Courts or
Tribunals which impact the going concern status and the Company's Operations in
future.
43. AWARDS
During the FY under review, the Company has received the following
awards:
n Best Women's Footwear Brand by MYNTRA Tech Threads |
n Best Vegan Shoe Line - Metro Shoes by PETA India |
n Best Conversion Campaign SEO by - DMA Asia Sparkies |
n Most Admired Retailer Footwear IMAGE RETAIL AWARDS 2022 |
n Most Admired Retailer of the year 2022 - Footwear Category by
MAPIC India Retail Awards |
n Best Use Of Cloud Services Ecommerce by Technology Excellence
Awards 2022 |
n India's Most Admired Retailer IMAGE Fashion Awards |
n India's Retail Champions 2022 - Footwear |
The Company was also featured as one of the iconic brands of India By
Economic Times (ETEdge).
The name of the CEO of our Company, Mr. Nissan Joseph, was recognized
as a Fashion Brand Icon by Image Business of Fashion. He was also honored as the most
daring CEO by Entrepreneur Magazine.
After the close of the FY under review, the Company has also received
Images Retail Awards 2023 - "Most Admired Footwear Retailer of the Year" in May
2023. The Company's executive also won TRRAIN Retail Award for Customer Impact under
Individual Category in April 2023.
These achievements are a testament to the outstanding leadership and
innovation within your Company.
44. GREEN INITIATIVES
In commitment to align with green initiatives and surpassing them, the
electronic copy of the Notice of the 46th Annual General Meeting of the Company, along
with the Annual Report for FY 2022-23, is being sent to all Members whose e-mail addresses
are registered with the Company / Depository Participant(s).
45. CORPORATE GOVERNANCE AND DISCLOSURES
Maintaining high standards of Corporate Governance has been fundamental
to the business of our Company since its inception. The Company's Corporate
Governance practices reflect value system encompassing culture, policies, and
relationships with the stakeholders.
Pursuant to Regulation 34(3) read with Schedule V of SEBI Listing
Regulations a report on Corporate Governance along with a Certificate from the Secretarial
Auditors towards compliance of the provisions of Corporate Governance, forms an integral
part of this Annual Report and are given in Annexure 7.
The CEO and the CFO have certified to the Board inter-alia, confirming
the correctness statements and cash flow statements, adequacy of the internal control
measures and reporting of matters to the Audit Committee as required under Regulation
17(8) read with Schedule II to the SEBI Listing Regulations.
46. GENERAL DISCLOSURES
The Directors state that no disclosure or reporting is required in
respect to the following items as there were no transactions / matters on these items
during the FY under review:
i. There was no change in the nature of business of the Company during
the FY ended March 31, 2023.
ii. Details relating to deposits covered under Chapter V of the Act.
iii. Issue of equity shares with differential rights as to dividend,
voting or otherwise, issue of sweat equity shares and buyback of shares.
iv. Neither the Managing Director nor the Whole-time Director of your
Company received any remuneration or commission from any of its subsidiaries.
v. No significant or material orders were passed by the regulators or
courts or tribunals which impact the going concern status and Company's operations in
future.
vi. There is no one time settlement done with any bank or financial
institution.
vii. No proceedings are filed by the Company or pending against the
Company under the Insolvency and Bankruptcy Code, 2016.
47. ACKNOWLEDGEMENT
Your Directors would like to express their gratitude to the esteemed
Shareholders for their trust and confidence in the management of the Company.
They would also like to place on record their sincere appreciation for
the continued cooperation, guidance, support, and assistance extended by bankers,
customers, suppliers, local authorities, business associates, government and
non-government agencies, and various other stakeholders.
The Board acknowledges and appreciates the support and cooperation the
Company has been receiving from its suppliers, distributors, retailers, business partners,
and others associated with them. This collaboration has enabled the Company to provide
higher levels of consumer delight through continuous improvement. of the financial
The Board extends its deep appreciation to all Employees and every
Member of the Metro Brands' Family at all levels for their hard work, dedication, and
commitment. The enthusiasm and unwavering efforts of the Employees have enabled the
Company to remain an industry leader.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS
FOR METRO BRANDS LIMITED |
Sd/- |
Rafique Abdul Malik |
Chairman and Executive Director |
DIN: 00521563 |
. |
Place: Mumbai |
Date: August 1, 2023 |
|