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RESILIENCE, CARE AND GROWTH The global pandemic and the subsequent lockdowns have caused a disquieting degree of turmoil and uncertainty in the country. Consequently, the year posed an environment filled with multi-faceted challenges for the businesses with sharp disruption in demand and supply situations. These challenges, however, also proved to be a resilience barometer for different sectors and businesses. While most sectors witnessed a sharp contraction in the output, the agriculture sector was resilient and grew at 3.6% during the year. Crisis of such scale often tests the mettle of the organisation’s vision and resolution towards achieving its commitments. For us, therefore, it was imperative to invest in growth by focusing on people, planet and profits. We have expanded our portfolio and invested in the brownfield and greenfield expansion of the facilities for supporting research and development initiatives. We have invested in a new fish feed plant in Barabanki (Uttar Pradesh), which is currently under-construction. In our subsidiary Astec LifeSciences Limited, we are in process of commissioning a herbicide plant at an investment more than ` 115 Crore. To bolster our R&D in the subsidiary, we have also invested in a new state-of-the-art R&D centre in Rabale (Maharashtra). Till the time the new centre is operational, we have leased a big R&D centre in Dombivali (Maharashtra). We at Godrej Agrovet Limited have always been proud to transform the lives of our partners and consumers through innovative, high-performance, cutting-edge products and services. We quickly adapted to the changing situation and focused on conducting the business on three pillars of resilience, care and growth. With our end-products being essential, it was imperative to scale up and provide an uninterrupted supply of the goods and services through-out the year to consumers. Towards our efforts to expand our offering for customers, we not only expanded our product portfolio of consumer- facing businesses, but also revamped our strategy to increase our market reach. Our ready-to-cook vegetarian and non-vegetarian products range under the Yummiez brand, provided readily available protein-rich food snack options to households during the lockdown. We launched new variants to increase our product offering and also tied-up with digital platforms to reach a wider customer base. Under Godrej Jersey, we introduced dairy sweet Mysore Pak and re-launched the Godrej Jersey Ghee. We also re-launched the entire product portfolio under the revamped Godrej Jersey logo. Continuing with our support towards doubling farmers’ income, we launched a new cattle feed product ‘Samruddhi’ in western India, which provides a higher feed conversion ratio and bolsters farmers’ income. At Godrej Agrovet Limited, we are also committed in serving the society to best of our abilities. The team worked relentlessly to provide immediate relief to the contractual workers and local communities around our manufacturing plants. We also contributed to the Government’s efforts to fight the pandemic and helped in strengthening the public healthcare system. Further, we invested a large portion of the budget to fulfil our commitments and responsibilities in four key areas: developing communities, water positivity, carbon neutrality, COVID relief and recovery. On the people front, the safety of our employees has always been paramount. In line with the regulatory norms imposed by the various state governments, we focused on establishing strong safety protocols across our facilities. Consequently, all our plants became operational quickly and resumed operations to increase our profitability along with ensuring a high degree of safety for our employees. The second wave of COVID-19 is pushing the economy into a tailspin; forcing governments to impose micro- lockdowns across the country to safeguard lives. As a responsible, trusted, and people-centric organisation, we initiated an active vaccination program for our employees, their families, their dependents, our contract workers and our business partners (in certain geographies). We believe that in the coming months, the economic revival is dependent on consumers’ willingness to spend. Experts have pegged the agriculture sector to be among the frontrunners in terms of bounce-back and Godrej Agrovet is well placed to capitalize on this opportunity. Contents Our Values 2 Board of Directors 4 Corporate Information 6 From the Desk of the Chairman 8 Financial Highlights 10 Management Discussion and Analysis Report 12 Business Responsibility Report 26 Notice of Annual General Meeting (AGM) & Explanatory Statement 48 Directors’ Report and Annexures 62 Corporate Governance Report 97 Standalone Financials & Auditors’ Report 132 Consolidated Financials & Auditors’ Report 205 Godrej Agrovet Limited 1 THE GODREJ WAY To live our purpose, we need to ensure that we are guided by the right values Our Values Trust Be Bold Create Delight - We hold ourselves to the highest - We have bold ambitions. - We place our consumers at the standards of personal and We set the bar high. heart of all we do. business integrity. We outperform expectations. - We obsess over current and - Our word is stronger than - We adapt, We are agile future needs of our consumers. any contract. and resilient. And then deliver. - We put people and our planet - We continuously innovate. - We offer consumers amazing alongside profits. We champion new ideas. quality products at great value. We take risks. 2 Annual Report 2020-21 Own It Be Humble Show Respect - We are 100/0. Take 100% - We own up to and learn from - We treat people like we would accountability with 0 excuses. our mistakes. want to be treated. - We speak our mind. - We ask for feedback. And then - We embrace and celebrate We challenge the status quo. grow with it. diversity. - We focus on the details, but - We give credit wherever due. - We foster collaboration. never forget the bigger picture. Godrej Agrovet Limited 3 BOARD OF DIRECTORS Mr. Nadir B. Godrej Mr. Jamshyd N. Godrej Mr. Vijay M. Crishna Chairman (Non-Independent Director) (Non-Independent Director) Mr. Balram S. Yadav Dr. Raghunath A. Mashelkar Dr. Ashok Gulati (Managing Director) (Independent Director) (Independent Director) Dr. Ritu Anand 4 (Independent Director) Annual Report 2020-21 Ms. Tanya A. Dubash Ms. Nisaba Godrej Mr. Pirojsha A. Godrej (Non-Independent Director) (Non-Independent Director) (Non-Independent Director) Mr. Natarajan Srinivasan Mr. Kannan Sitaram Ms. Aditi Kothari Desai (Independent Director) (Independent Director) (Independent Director) Ms. Roopa Purushothaman Godrej Agrovet Limited (Independent Director) 5 CORPORATE INFORMATION Statutory Auditors : B S R & Co. LLP, Chartered Accountants Secretarial Auditors : BNP & Associates, Company Secretaries Cost Auditors : P. M. Nanabhoy & Co., Cost Accountants BOARD COMMITTEES : Audit Committee : Mr. Kavas N. Petigara (Chairman, resigned w.e.f. April 1, 2021) Mr. Natarajan Srinivasan (Chairman, inducted w.e.f. April 23, 2021) Mr. Balram S. Yadav Dr. Ritu Anand Ms. Aditi Kothari Desai Nomination and Remuneration Committee : Dr. Ritu Anand (Chairperson) Ms. Nisaba Godrej Ms. Roopa Purushothaman Stakeholders’ Relationship Committee : Mr. Nadir B. Godrej (Chairman) Mr. Balram S. Yadav Mr. Natarajan Srinivasan Corporate Social Responsibility Committee : Dr. Raghunath A. Mashelkar (Chairman) Mr. Nadir B. Godrej Mr. Balram S. Yadav Ms. Roopa Purushothaman Risk Management Committee : Mr. Nadir B. Godrej (Chairman) Mr. Balram S. Yadav Mr. Natarajan Srinivasan Managing Committee : Mr. Nadir B. Godrej (Chairman) Ms. Nisaba Godrej Mr. Pirojsha Godrej Mr. Balram S. Yadav Chief Financial Officer : Mr. S. Varadaraj Company Secretary & Compliance Officer : Mr. Vivek Raizada Registrar and Share Transfer Agent : KFin Technologies Private Limited (Formerly known as Karvy Fintech Private Limited) Selenium Building, Tower B, Plot No. 31 & 32, Financial District, Nanakramguda, Serilingampally, Hyderabad - 500 032, Rangareddy, Telangana, India Tel.: (91 40) 6716 2222 Fax: (91 40) 2343 1551 Investor Grievance E-mail: [email protected] Website: www.kfintech.com 6 Annual Report 2020-21 Registered Office : “Godrej One”, 3rd Floor, Pirojshanagar, Eastern Express Highway, Vikhroli (East), Mumbai – 400 079, Maharashtra, India Tel. No.: (91 22) 2519 4416 Fax No.: (91 22) 2519 5124 Website: www.godrejagrovet.com E-mail: [email protected] Major Factories : Animal Feed: Sachin (Surat, Gujarat) Miraj (Sangli, Maharashtra) Dhule (Maharashtra) Khanna (Ludhiana, Punjab) Ikolaha (Ludhiana, Punjab) Chandauli (Uttar Pradesh) Kharagpur (West Bengal) Erode (Tamil Nadu) Hajipur (Bihar) Tumkur (Karnataka) Medchal (Telangana) Unnao (Uttar Pradesh) Khurda (Orissa) Crop Protection Business: Samba (Jammu & Kashmir) Lote Parshuram (Maharashtra) Vegetable Oils: Ch. Pothepalli (West Godavari Dist., Andhra Pradesh) Chintampalli (West Godavari Dist., Andhra Pradesh) Seethanagaram (West Godavari Dist., Andhra Pradesh) Varanavasi (Ariyalur, Tamil Nadu) Valpoi (Sattari, Goa) Kolasib (Mizoram) Aqua Feed: Hanuman Junction (Krishna Dist., Andhra Pradesh) Kondapalli (Vijayawada, Andhra Pradesh) Research & Development Centres : Vikhroli (Maharashtra) Nashik (Maharashtra) Chintampalli (Andhra Pradesh) Bankers : Central Bank of India Union Bank of India State Bank of India Godrej Agrovet Limited 7 FROM THE DESK OF THE CHAIRMAN Mr. Nadir B. Godrej (Chairman) Dear Shareholders, I hope you and your families are safe and healthy. Financial Year