Your Directors are pleased to present the 27th Annual Report on the businessand operations of the Company along with the Audited Annual Financial Statements and theAuditors' Report thereon for the financial year ended 31st March 2016. Thefinancial highlights for the year under review are given below:
| || ||(Rs. in lacs) |
|Particulars ||Financial Year 2015-16 ||Financial Year 2014-15 |
|Revenue from Operations & Other Income ||4050 ||27414 |
|Operating Profit /(Loss) ||(462) ||(1018) |
|Finance Charges ||276 ||196 |
|Profit (Loss) before depreciation & Tax ||(739) ||(1214) |
|Depreciation ||862 ||682 |
|Exceptional Item ||278 ||Nil |
|Profit/ (Loss) before Tax ||(1879) ||(1896) |
|Taxation ||209 ||100 |
|Profit/ (Loss) for the year ||(2088) ||(1996) |
|Proposed Dividend ||Nil ||Nil |
|Tax on Dividend ||Nil ||Nil |
The volatility and uncertainty in the economy continued during the year. Due to slowdown in the markets across the world and decline in the export the net revenue of theCompany was Rs.4050 lacs as compared to Rs. 27414 lacs during the previous year. TheOperating profit/(loss) i.e profit/ (loss) before interest depreciation & Tax duringthe year was Rs. (462) lacs as compared to Rs. (1018) lacs during the previous year. Thenet profit/(loss) after tax was Rs.(2088) lacs during the year as compared to Rs.(1996)lacs during the previous year.
CHANGE IN NATURE OF BUSINESS IF ANY
There is no change in the nature of business of the Company during the year.
Considering the continued weak operating environment in the standalone business and inview of the losses for the year no dividend is permitted to be paid to the Members forFinancial Year 2015-16 as per the Companies (Declaration and Payment of Dividend) Rules2014.
The paid up Equity Share Capital was Rs.1355.98 Lacs and paid up Preference Sharecapital was Rs.31.86 Lacs as on March 31st 2016.
As the members are aware the Company's equity shares are compulsorily tradable inelectronic form. As on March 31st 2016 12777561 shares (94.23%) of theCompany's total paid-up capital representing 13559800 shares are in dematerialized form.In view of the numerous advantages offered by the Depository system members holdingshares in physical mode are advised to avail of the facility of dematerialization fromeither of the depositories.
The Shares of your Company are listed on Bombay Stock Exchange Limited (BSE) andNational Stock Exchange India Limited (NSE). The Listing fee for the year 2016-17 has beenpaid to the Stock Exchanges. Annual custodian charges of Depository have also been paid toNSDL and CDSL for the same period.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the year the Company has transferred the unpaid or unclaimed dividends for thefinancial year 2007-2008 amounting to ' 1073327/-to Investor Education & ProtectionFund (IEPF). This amount was due & payable and remained unclaimed and unpaid for aperiod of seven years as per relevant provisions of Companies Act 2013 and rules madethereunder.
Pursuant to the provisions of Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with Companies) Rules 2012 theCompany has uploaded the details of unpaid and unclaimed amounts lying with the Company.
The amount of dividend for the subsequent years i.e from the financial year ended 31stMarch 2009 and onwards remaining unclaimed for a period of seven years from the date oftransfer to Unpaid dividend account of the Company shall be transferred to the InvestorEducation and Protection Fund set up by the Government of India and no payments shall bemade in respect of any such claims.
SUBSIDIARY COMPANY & CONSOLIDATED FINANCIAL STATEMENTS
As on 31st March 2016 the company has four subsidiary companies namelyAlchemist Foods Limited Alchemist Infrastructures Private Limited and AlchemistHospitality Group Limited Alchemist Enterprise (s) Pte Limited Singapore.
The Financial Statements of Alchemist Limited's wholly owned foreign subsidiary"Alchemist Enterprise (S) Pte Ltd." is not consolidated because the same isunder the compilation processs till the date of balance sheet. Financial statements ofother subsidiaries are consolidated as per the requirements of the Companies Act 2013accounting standards and accounting policies applicable to the company.
Pursuant to Section 129(3) of the Act a statement containing the salient features ofthe financial statements of the subsidiary companies is attached to the FinancialStatements in Form AOC-1. The Company will make available the said financial statementsand related detailed information of the subsidiary companies upon the request by anymember of the Company or its subsidiary companies. These financial statements will also bekept open for inspection by any Member at the Registered Office of the Company. TheConsolidated Financial Statements presented by the Company include the financialstatements of its subsidiary companies.
The Company has not accepted any deposits from the public during the year under review.
The company's main business segments are Agri Business comprising largely floricultureSteel and Chemicals pharma division comprising the manufacturing and trading. Thecompany's subsidiaries are in the business of foods and food processing infrastructuresand Hospitality.
Alchemist Pharma division is a strong vertical of Alchemist Group with around 200 SKU'sand promoted through a very strong committed field force. Pharma division enjoystremendous respect with the medical fraternity and covering a universe of around 40000Doctors and 20000 retailers across the country. Alchemist's Molecules have beenacknowledged with tremendous response at the market place. A detailed write up on thepharma divisions is contained in the section on Management Discussion and Analysiselsewhere in this report.
The company continued to mark its presence in business of Global Agri Trade.
Steel business segment is consistently making achievement and the production effortsarenow supplemented by trading activity as well.
Particulars of loans guarantees or investments under section 186
Complete details of Loans Guarantees and Securities and Investments covered underSection 186 of the Companies Act 2013 given during the year under review is providedbelow: .
DETAILS OF INVESTMENTS:-
|SL. No. ||Date of investment ||Details of Investee ||Amount (In Lacs) ||Purpose for which the proceeds from investment is proposed to be utilized by the recipient ||Date of BR ||Date of SR (if reqd) ||Expected rate of return |
|1 ||23.04.2014 ||Alchemist Foods Limited ||13900.21 ||For the expansion of the business ||28.05.2015 ||23.04.2014 ||1% OCRP |
Related Party Transaction
All the related party transactions are entered on arm's length basis and are incompliance with applicable provisions of the Act and the Listing Agreement.
All related party transactions are presented to the Audit Committee and the Board. Saidapprovals are obtained for the transactions which are foreseen and repetitive in nature. Astatement of all related party transactions is presented before the Audit Committeeperiodically specifying the nature value and terms and conditions of the transactions.
Related Party Transaction Policy as approved by the Board is uploaded on Company'sWebsite at the web link i.e. http:// www.alchemist.co.in/investors.html .
The details of the transactions with the Related Party are provided in the accompanyingfinancial statements. None of the Directors has any pecuniary relationships ortransactions vis-a-vis the Company.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo
All possible measures have been undertaken successfully by your Company to achieve thedesired objective of energy conservation and technology absorption. Particulars of EnergyConservation Technology Absorption and Foreign Exchange Earnings and Outgo required underthe Companies (Accounts) Rules 2014 is annexed as Annexure-I
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Corporate Social Responsibility Committee (CSR Committee) has formulated andrecommended to the Board a Corporate Social Responsibility Policy (CSR Policy) indicatingthe activities to be undertaken by the Company which has been approved by the Board. TheCSR Policy may be accessed on the Company's website at the link: http://www.alchemist.co.in/investors.html .
The Annual Report on CSR activities is annexed herewith marked as Annexure II.
DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTED/RESIGNED/RETIRED DURING THEYEAR
In accordance with the provisions of Companies Act 2013 and Article of Association ofthe Company Mr.Vinay Kumar Mittal (DIN-00287042) will retire by rotation at the ensuingAnnual General Meeting and being eligible offer himself for reappointment. The Boardrecommends his re-appointment as a Director of the Company.
The Board has appointed Mr. Tanveer Gill as an Independent Director of the Companyeffective from 30th March 2016 to 29th March 2021 subject to theapproval of the shareholders. Mr. Tanveer Gill appointed as an Additional Director willhold office till the ensuing AGM and is eligible for appointment. The Company has receivedrequisite request in writing from a member of the Company proposing the candidature of Mr.Tanveer Gill for the office of Independent Director. The Board recommends hisre-appointment as an Independent Director of the Company.
During the year following Directors resigned/ceases from the Board -
- Mr. Major Gen. (Retd.) Anil Kumar Oberoi and Mr. Jaspreet Singh Jolly with effectfrom 18th April 2015 and 20th May 2015 respectively.
- Mr. Tarlochan Singh and Mr. R. P Chhabra with effect from 15th April 2015and 5th June 2015 respectively.
- Mr. Asoke Kumar Chatterjee with effect from 04th August 2015 due todeath. Ms. Silpi Chakraborty resigned with effect from 27th January 2016.
The Board places on record its appreciation of the immense contribution made by aboveDirectors to the Company.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under the Actand relevant regulation of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 with the Stock Exchanges. All independent directors shall hold officefor a term up to five consecutive years on the Board of a Company but shall be eligiblefor reappointment for next five years on passing of a special resolution by the Companyand disclosure of such appointment in the Board's report.
The details of program for familiarization of Independent Directors with the Companytheir roles rights responsibilities in the Company nature of the industry in which theCompany operates business model of the Company and related matters are put up on thewebsite of the Company at http://www.alchemist.co.in/investors.html . All the independentdirectors of the Company are made aware of their role responsibilities & liabilitiesat the time of their appointment /re-appointment through a formal letter of appointmentwhich also stipulates various terms and conditions of their engagement.
During the year 6 (Six) Board Meetings and 4 (four) Audit Committee Meetings wereconvened and held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013 and Listing Regulations.
COMPANY POLICY ON DIRECTOR APPOINTMENT AND REMUNERATION
The Company has in place a Nomination & Remuneration Committee in accordance withthe requirements of the Companies Act 2013 read with the rules made thereunder andRegulation 19 of SEBI (Listing Obligations and Disclosures Requirements) Regulation 2015.The details relating to the same are given in Report on Corporate Governance forming partof this Report.
The Committee has formulated a policy on Director's appointment and remunerationincluding recommendation of remuneration of the key managerial personnel and SeniorManagement board diversity composition and the criteria for determining qualificationspositive attributes and independence of a Director.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of Unpublished Price Sensitive Information (UPPSI) in relation to theCompany and during the period when the Trading Window is closed. The Board is responsiblefor implementation of the Code.
Pursuant to the provisions of the Companies Act 2013 and Relevant provisions of SEBI(Listing Obligations and Disclosures Requirements) Regulation 2015 the Board has carriedout an annual performance evaluation of its own performance the directors individually aswell as the evaluation of the working of its Audit Nomination & RemunerationCommittees. The manner in which the evaluation has been carried out has been explained inthe Corporate Governance Report.
VIGIL MECHANISM/WHISTLE BLOWER POLICY/ RISK MANAGEMENT
In order to ensure that the activities of the Company and its employees are conductedin a fair and transparent manner by adoption of highest standards of professionalismhonesty integrity and ethical behaviour the company has adopted a Vigil Mechanism Policy/Whistle Blower policy.
In today's challenging and competitive environment strategies for mitigating inherentrisks in accomplishing the growth plans of the Company are imperative. The common risksinter alia are: Regulations competition Business risk Investments retention of talentand expansion of facilities. Business risk inter-alia further includes financial riskpolitical risk fidelity risk legal risk. These risks are assessed and steps asappropriate are taken to mitigate the same.
INTERNAL CONTROL SYSTEM
Details of internal control system and its adequacy are included in the ManagementDiscussion and Analysis Report which forms part of this Report.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has in place a Prevention of Sexual Harassment policy in line with therequirements of the Sexual Harassment of Women at the Workplace (Prevention Prohibitionand Redressal) Act 2013. An Internal Complaints Committee has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy. During the year 2015-2016 nocomplaints were received by the Company related to sexual harassment.
M/s N. Kumar Chhabra & Co. Chartered Accountants have been appointed as statutoryauditors of the Company at the 25th Annual General Meeting held on September 26th2014 for a period of three years subject to ratification by members at every subsequentAnnual General Meeting. Therefore ratification of appointment of Statutory Auditors isbeing sought from the members of the Company at the ensuing AGM.
The Company has received a certificate from M/s N. Kumar Chhabra & Co. CharteredAccountants Statutory Auditors to the effect that their re-appointment if made would bewithin the limits prescribed under Section 141(3) (g) of the Companies Act 2013 and theyare not disqualified to be re-appointed as Statutory Auditors.
EXPLANATION TO AUDITOR'S REMARKS
The Board has taken note of the Observations made by the Auditors in their Report.
Reply to Auditors qualifications/observations-
- Regarding redemption of preference shares otherwise than out of the profits-Theredemption process had been carried by the company as part of contractual obligations ondue dates. The amount is not material in overall context and the company will make thereserves for this purpose in future. The management will raise the funds through freshissue in future for the aforesaid purpose so that the provision of the companies act willnot be violated.
- Regarding computation of Depreciation- Depreciation is provided based onuseful life of the Assets as prescribed in schedule II of the Companies Act 2013. TheCompany had to make assumption about the life of assets in view of changes in the law andhas made best judgement assessment for all the circumstances and ensure to comply theprovisions of schedule II of the Companies Act 2013.
- Regarding outstanding export receivables- The Company has extended credit fromtime to time as per the market practice for export receivable and regular follow up isbeing done to recover the same and the management is confident to recover the same. Henceno provision made by the management.
- Regarding consolidation of the financial statement of the foreign wholly ownedsubsidiary Alchemist Enterprises (S) Pte Ltd- The Financial Statements of wholly ownedforeign subsidiary "Alchemist Enterprise (S) Pte Ltd." is not consolidatedbecause the same is under the compilation process till the date of balance sheet and thecompany is under process of closure.
- Regarding internal financial control- To have an effective and transparentinternal financial control the management have engaged an outside agency to document thepresent internal financial controls in place and make improvements wherever required.Since the agency was engaged in February 2016 they were still in the process ofestablishing the internal financial control as on March 31st 2016.
The Board has appointed M/s Virender Sharma & Associates Company Secretaries toconduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report forthe financial year ended 31st March 2016 is annexed herewith marked as Annexure-III to this Report.
EXPLANATION TO SECRETARIAL AUDITOR'S REMARKS
The Board has taken note of the Observations made by the Secretarial Auditors in theirReport.
- Regarding redemption of preference shares otherwise than out of the profits- Theredemption process had been carried by the company as part of contractual obligations ondue dates. The amount is not material in overall context and the company will make thereserves for this purpose in future. The management will raise the funds through freshissue in future for the aforesaid purpose so that the provision of the companies act willnot be violated.
The Company has appointed Ms. Swaraj Sindhu Chartered Accountant (MembershipNo.-515486) as internal auditor to undertake the audit exercise. During the year theCompany continued to implement their suggestions and recommendations to improve thecontrol environment. This includes review of processes for safeguarding the assets of theCompany review of operational efficiency effectiveness of systems and processes andassessing the internal control strengths in all areas. Internal Auditors findings arediscussed with the process owners and suitable corrective actions taken as per thedirections of Audit Committee on an ongoing basis to improve efficiency in operations.
M/s. SDM & Associates Cost Accountants Chandigarh is being appointed as the CostAuditor of the Company to conduct the audit of the cost records of the Company for thefinancial year the for financial year 2015-16.
The Board of Directors at its meeting held on 10th May 2016 has approvedthe appointment of M/s. SDM & Associates Cost Accountants as the Cost Auditors of theCompany for conducting audit of cost records for the financial year ending 31stMarch 2017. A proposal for ratification of remuneration of the Cost Auditors forFinancial Year 2016-17 is placed before the shareholders.
PARTICULARS OF EMPLOYEES
Information in accordance with the provisions of Section-134 (3) (q) and Section197(12) of the Act read with Rule 5(1) & Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are appended as Annexure IV tothe Directors Report.
Your Company treats its "Human Resources" as one of its most importantassets. The Company has taken pragmatic steps for strengthening organizational competencythrough involvement and development of employees as well as installing effective systemsfor improving the productivity quality and accountability at functional levels.
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
Your Company has taken reasonable steps to prevent risks and the Board is kept apprisedof the risk assessment and minimization procedure. The assets of the Company have beenadequately covered under insurance. The policy values have been enhanced taking intoconsideration the expanded and upgraded facilities of the Company.
The Company continues to derive its business and service functions through deploymentof a strong Information Technology network across its offices verticals outlets etc. toinculcate efficiency and discipline at all levels. In pursuit of this the Company hasfurther strengthened its Human Resource Information System (HRIS) viz. My Adrenalin whichis web portal dedicated to employees. The employee's information like personal data(personal information qualification and remuneration details etc.) employee data(current & past employment and training details) self-task (attendance leave andtraining request IT declarations etc.) and MIS continue to be coordinated through thisSystem. The Management of the Company interacts with the employees with regular thoughtsand messages on this portal. Also Monthly Newsletter of the Company and other significantinformation are posted on the same. This initiative of the company is a move towardspaperless regime reduction in costs saving of trees and thereby environment. A detailedwrite up on the IT Business is contained in the section on Management Discussion andAnalysis.
RESEARCH AND DEVELOPMENT
The Company continues to give significant attention to Research & Development whichhas been providing significant support to the manufacturing capabilities of the Companyand has helped the company in expanding its product basket significantly. This has alsoenabled the Company to become the most preferred source for its customers and also launchglobal associations.
EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 as a part of this Annual Report as ANNEXURE-V.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
A detailed analysis of the Company's performance is discussed in the ManagementDiscussion and Analysis Report which forms part of this Annual Reportand marked as Annexure-VI.
As required by regulation 27(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 with the stock exchanges a detailed report of CorporateGovernance as well as Corporate Governance Compliance Certificate is included in theAnnual Report and marked as Annexure-VII.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to clause (c) of sub-section (3) of Section 134 of the Companies Act 2013the Directors confirm that:- in the preparation of the annual accounts the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures.
- accounting policies have been selected and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitand loss of the company for that period.
- proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of thecompany and for preventing and detecting fraud and other irregularities
- the annual accounts have been prepared on a going concern basis; and;
- Internal financial controls followed by the company and those internal financialcontrols are adequate and were operating effectively.
- proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively. To have aneffective and transparent internal financial control the management have engaged anoutside agency to document the present internal financial controls in place and makeimprovements wherever required.
We thank the Government of India and Governments of various states where the companyhas its operations. We also take this opportunity to thank our bankers Punjab NationalBank UCO Bank Bank of India State Bank of India HDFC Bank Ltd and other banks fortheir continuous support to the company.
We also thank our esteemed customers & clients vendors and investors for theircontinued support during the year. We also take this opportunity to place on recordappreciation of the contribution made by our employees at all levels. Our growthdemonstratestheir commitment handwork support and cooperation.
| ||For and on behalf of the Board of Directors |
| ||ALCHEMIST LIMITED |
| ||Sd/- |
| ||Pavan Kumar Verma |
|Date: 10th August 2016 ||(Whole time Director) |
|Place: New Delhi ||DIN-00213365 |
|Annexure ||Content |
|I ||Particulars of Energy Conservation Technology Absorption and Foreign Exchange |
|II ||Annual Report on Corporate Social Responsibility (CSR) Activities |
|III ||Secretarial Audit Report |
|IV ||Particulars of Employees under Section 134(3)(q) and Section 197(12) of the Companies Act 2013 |
|V ||Annual Return Extracts in MGT 9 |
|VI ||Statement containing salient features of the financial statement of subsidiaries Companies in Form AOC-1. |
|VII ||Management Discussion and Analysis Report |
|VIII ||Report on Corporate Governance |
Particulars of Energy Conservation Technology Absorption and Foreign Exchange
Particulars of Conservation of energy Technology absorption and Foreign exchangeearnings and outgo in terms of Section 134 (3) (m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 forming part of the Directors' Report for the year ended31st March 2016.
A. CONSERVATION OF ENERGY
(i) The Steps taken or impact on Conservation of Energy and the steps taken by theCompany for utilizing alternate sources of Energy
The Company continues to work towards Conservation of Energy and has been takingvarious measures like replacement of outdated energy intensive equipment with energysaving equipment better use of natural/ artificial lights installation of variablefrequency drive in place of conventional motors timely maintenance of electricalequipment etc. It has helped the company in improving efficiency reduction in cost ofproduction with lesser break down of machinery.
(ii) The Capital Investment (if any) on Energy conservation equipment
The Company is engaged in energy conservation on continuous basis. The company hastaken adequate steps for effective utilization of power for cost reduction.
B. TECHNOLOGY ABSORPTION
The Company has not imported any technology during the year under review.
C. Research and Development (R&D)
Your Company continues to accord high priority to the Research & Developmentactivities. Research & Development Centre of the Company carries out research work inseveral areas with the objective of introducing new products; improve quality of existingproducts and to lower the cost of production.
D. FOREIGN EXCHANGE EARNINGS AND OUTGO
|Total Foreign Exchange Earned ||Nil |
|Total Foreign Exchange Outgo ||Nil |
| ||For and on behalf of the Board of Directors |
| ||ALCHEMIST LIMITED |
| ||Sd/- |
| ||Pavan Kumar Verma |
|Date: 10th August 2016 ||(Whole time Director) |
|Place: New Delhi ||DIN-00213365 |