To the Shareholders
We are pleased to present the 32nd Annual Report on the business andoperations of the Company along with the Audited Financial Statements for the financialyear ended 31st March 2016. The financial highlights for the year under revieware given below:
|Particulars ||Standalone Financials Highlights ||Consolidate Financials Highights |
| ||(Rs in Lacs) || ||(Rs in Lacs) || |
| ||2015-2016 ||2014-2015 ||2015-2016 ||2014-2015 |
|Total Revenue ||1050.91 ||4360.95 ||1106.46 ||4395.27 |
|Total Expenditure ||1086.71 ||4241.28 ||1362.31 ||4432.15 |
|Profit & Loss Before Exceptional item ||-35.80 ||119.67 ||-255.85 ||-36.88 |
|Exceptional Item ||49.01 ||0 ||49.01 ||0 |
|Profit & Loss Before Tax ||-84.81 ||119.67 ||-304.87 ||-36.88 |
|Tax Expenses ||-9.47 ||46.91 ||-9.47 ||46.91 |
|Profit & Loss After Tax ||-75.34 ||72.76 ||-295.40 ||-83.79 |
The volatility and uncertainty in the economy continued during the year. The realestate market has been among the sectors worst hit by the economic downturn which coupledwith high interest rates in the face of persistent inflation and delays in securingmandatory government approvals has kept wary homebuyers away for the last couple ofyears. Due to slow down in the markets across the world the Standalone net revenue ofyour Company was Rs 1050.91 lacs as compared to Rs 4360.95 Lacs in previous year and hasincurred a loss of Rs 75.34 Lacs against profit of Rs 72.76 Lacs in previous year. FurtherConsolidate net revenue of your Company was Rs 1106.46 lacs as compared to Rs 4395.27Lacs in previous year and has incurred a loss of Rs 295.40 Lacs against loss of Rs 83.79Lacs in previous year The prospective vision of the Company with the evaluation of thebusiness and operations of the Company are provided in the Report on Management Discussionand Analysis forming part of the Annual Report.
CHANGE IN NATURE OF BUSINESS IF ANY
There is no change in the nature of business of the Company during the year.
DIVIDEND & TRANSFER OF RESERVE
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. There is no transfer to reserves during the financial year.
The paid up Equity Share Capital as on March 31 2016 was Rs 1482.02 Lacs (i.e.74101000 equity Shares of Rs 2 each). During the year under review: (a) Issue of equityShares with differential rights : Nil (b) Issue of sweat equity shares : Nil (c) Issue ofemployee stock options: Nil (d) Provision of money by company for purchase of its ownshares by employees or by trustees for the benefit of employees: Nil (e) Debentures: Nil
As the members are aware the Companys equity shares are compulsorily tradable inelectronic form. As on March 31 2016 74075782 (99.96%) of the Companys totalpaid-up capital representing 74101000 shares are in dematerialized form. In view of thenumerous advantages offered by the Depository system members holding shares in physicalmode are advised to avail of the facility of dematerialization from either of thedepositories.
The Companys shares are listed on the Bombay Stock Exchange Ltd. (BSE) and areactively traded. The Listing Fees for the year 2016-17 has already been paid.
CHANGE IN REGISTRAR AND SHARE TRANSFER AGENT
Sharepro Services (India) Private Limited has ceased to be RTA of the Company w.e.f22.07.2016 and the new RTA Alankit Assignments Limited has been appointed w.e.f 23.07.2016of the Company.
CHANGE IN REGISTERED OFFICE ADDRESS
The company has changed its Registered office from 62B Mittal Tower 210 NarimanPoint Mumbai - 400021 to Office No.109 Jewel Box (Roxy Cinema Building) Mama ParmanandMarg Opera House Mumabi - 400004.
SUBSIDIARY COMPANIES & CONSOLIDATED FINANCIAL STATEMENTS
As on 31st March 2016 the Company has one wholly owned subsidiary i.e.Alchemist Hill Resorts Private Limited and one Subsidiary i.e. Century 21 Properties IndiaPrivate Limited.
In accordance with Section 129(3) of the Companies Act 2013 the Company has prepareda consolidated financial statement of the Company and all its subsidiary companies whichis forming part of the Annual Report. Alchemist Hill Resorts Pvt. Ltd. did not do anycommercial activity during the financial year.
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 is annexed as Annexure -1. The Company will make availablethe said financial statements and related detailed information of the subsidiary companiesupon the request by any member of the Company or its subsidiary companies. These financialstatements will also be kept open for inspection by any Member at the Registered Office ofthe Company. The Consolidated Financial Statements presented by the Company include thefinancial statements of its subsidiary companies.
Your Company has not accepted deposits within the meaning of Section 73 and 76 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014. The questionof non-compliance of the relevant provisions of the law relating to acceptance of depositdoes not arise.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Particulars of Loans given Investments made or Securities provided by the Company havebeen disclosed in the financial statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions.
All related party transactions are presented to the Audit Committee and the Board.Approval is 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 CompanysWebsite at the web link i.e http:// www.alchemistrealty.com//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--vis the Company.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING 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-2
CORPORATE SOCIAL RESPONSIBILITY
Since the Company does not fall under the criteria as prescribed under section 135 (1)of the Companies Act 2013 hence the Company is not required to constitute CorporateSocial Responsibility Committee.
DETAILS OF DIRECTORS AND KEY MANAGRIAL PERSONNEL APPOINTMENT/RESIGNED/RETIRED DURINGTHE YEAR
Appointment-Reappointment of Directors
In accordance with the provisions of Section 152 of the Act and rules made there underMr. Pavan Kumar Verma Director (DIN:00213365) retires by rotation at the ensuing AnnualGeneral Meeting and being eligible offers himself for reappointment. The Board recommendsre-appointment of Mr. Pavan Kumar Verma at the ensuing Annual General Meeting.
Changes in Directors and Key Managerial Personnel
The Board has appointed Mr. Tanveer Gill as an Independent Non-Executive Directoreffective from 30th March 2016 to 29th March 2021 subject to theapproval of the shareholders. & Mr. Anil Kumar Lamba as an Additional Non-ExecutiveDirector of the Company w.e.f 29th June 2016. Mr. Tanveer Gill & Mr. AnilKumar Lamba appointed as an Additional Directors will hold office till the ensuing AGMand are eligible for appointment. The Company has received requisite request in writingfrom a member of the Company proposing the candidature of Mr. Tanveer Gill for the officeof Independent Director & Mr. Anil Kumar Lamba for the office of Director. The Boardrecommends their re-appointment as an Independent Non-Executive Director &Non-Executive Director of the Company.
During the year following Directors resigned/ceases from the Board -
Mr. Asoke Kumar Chatterjee with effect from 04th August 2015 due todeath.
Ms. Silpi Chakraborty with effect from 27th January 2016.
Mr. Tarlochan Singh and Mr. R. P. Chhabra with effect from 15thApril 2015 and 5th June 2015 respectively.
The Board places on record its appreciation of the immense contribution made by aboveDirectors to the Company. At the Board Meeting held on 28.09.2015 Mr. Suresh Bhardwaj Chief Financial Official (CFO) was appointed and designated as "Key ManagerialPersonnel" of the Company pursuant to Sections 2(51) and 203 of the CompaniesAct2013 read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 and Mr. Alok Mittal Chief Financial Officer of the Company has resignedw.e.f. 28.09.2015.
At the Board Meeting held on 09.11.2015 Ms. Nidhi Dhawan Company Secretary wasappointed and designated as "Key Managerial Personnel" of the Company pursuantto Sections 2(24) and 203 of the Companies Act 2013 read with the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 recommendation of Nomination andRemuneration Committee and Mr. Shyam Kumar Company Secretary of the company hasresigned w.e.f. 23.10.2015. Mr. Vaibhav Sharma Company Secretary of the Company hasresigned w.e.f 12.06.2015
Declaration by Independent Director(s)
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 Boards 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.alchemistrealty.com/. 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.
Separate Meeting of Independent Directors
In terms of requirements under Schedule IV of the Companies Act 2013 and Clause 49 ofthe Listing Agreement a separate meeting of the Independent Directors was held on March31 2016 The Independent Directors at the meeting inter alia reviewed the following:-
Performance of Non-Independent Directors and Board as a whole.
Performance of the Chairperson of the Company taking into account the views ofExecutive Directors and Non-Executive Directors.
Assessed the quality quantity and timeliness of flow of information between theCompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties.
The details required pursuant to Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Corporate GovernanceReport.
During the financial year ended 31st March 2016 7 (Seven) Board Meetings and4(four) Audit Committee Meetings were convened and held. The details of which are given inthe Corporate Governance Report. The intervening gap between the Meetings was within theperiod prescribed under the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015
COMMITTEES OF THE BOARD
The Companys Board has the following committees:
1. Audit Committee
2. Nomination & Remuneration Committee
3. Stakeholder Relationship Committee
Details of terms of reference of the Committees Committee membership and attendance atmeetings of the Committees are provided in the Corporate Governance report form part ofAnnual Report.
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) Regulations2015. The details relating to the same are given in Report on Corporate Governance formingpart of this Report.
The Committee has formulated a policy on Directors 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 Companys shares andprohibits the purchase or sale of Company shares by the Directors and the designatedemployees while in possession of unpublished price sensitive information (UPPSI) inrelation to the Company and during the period when the Trading Window is closed. The Boardis responsible for implementation of the Code.
ANNUAL EVALUATION OF BOARD
The Board of directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed under Regulation 27 (2) of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015. The performance of the Board was evaluated by the Board after seeking inputs fromall the directors on the basis of the criteria such as the Board composition andstructure effectiveness of board processes information and functioning etc. Theperformance of the committees was evaluated by the board after seeking inputs from thecommittee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee reviewed the performance of theindividual Directors on the basis of the criteria such as the contribution of theindividual Director to the Board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the Chairman was also evaluated on the key aspects of his role.
In a separate meeting of Independent Directors performance of Non-IndependentDirectors performance of the Board as a whole and performance of the Chairman wasevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual directors was also Discussed.
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 todays challenging and competitive environment strategies for mitigatinginherent risks in accomplishing the growth plans of the Company are imperative. The commonrisks inter alia are: Regulations competition Business risk Investments retention oftalent and expansion of facilities. Business risk inter-alia further includes financialrisk political risk fidelity risk legal risk. These risks are assessed and steps asappropriate are taken to mitigate the same.The management has taken all necessary steps toidentify the elements of risks if any. The management has implemented an effective andmeaningful system to safeguard the assets of the company. The Board has to review thebusiness plan at regular intervals and develop the Risk Management Strategy which shallencompass laying down guiding principles on proactive planning for identifying analyzingand mitigating all the material risks both external and internal viz. EnvironmentalBusiness Operational Financial and others. Communication of Risk Management Strategy tovarious levels of management for effective implementation is essential for achieving thegoals of the organisation.
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 K. Singh & Associates Chartered Accountants have been appointed as StatutoryAuditors of the Company at the 30th Annual General Meeting held on September30 2014 for a period of three years subject to ratification by members at everysubsequent Annual General Meeting. Therefore ratification of appointment of StatutoryAuditors is being sought from the members of the Company at the ensuing AGM.
The Company has received a certificate from M/s K. Singh & Associates CharteredAccountants and Statutory Auditors to the effect that their re-appointment if madewould be within the limits prescribed under Section 141(3)(g) of the Companies Act 2013and they are not disqualified to be re-appointed as Statutory Auditors.
Based on the recommendations of the Audit Committee and as per the provisions ofSection 139(1) of the Companies Act 2013 the Board of Directors of your Company proposesto ratify the appointment of M/s. K. Singh & Associates Chartered Accountants as theStatutory Auditors of the Company for FY 2016-17
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed M/s Virender Sharma & Associates Company Secretaries to conduct SecretarialAudit for the financial year 2015-16. The Secretarial Audit Report in MR-3 Form for thefinancial year ended 31stMarch 2016 is annexed herewith marked as Annexure-3 to this Report. There are no qualifications reservations or adverse remarks made bythe Secretarial Auditor in his report.
The Company has a separate internal audit department constituting of professionalsundertaking audit exercise.
As our company dont fall under the Section 148 and therefore the company is notrequired to appoint the cost auditor for the current financial year.
EXPLANATION THE POINT MENTION IN THE AUDITORS REPORT
Your Directors wish to clarify the various points reported by the Statutory Auditors intheir report as under :-
Under the head of "Basis of qualification" to the main reportregarding the trade receivables more than six months from the date become due for paymentyour Directors wish to state that the Company has extended credit from time to time as perthe market practice for export debtors and regular follow up is being done to recover thesame and the Management is confident to recover the same.
Point no. (a) the head of "Emphasis of Matter" to the main reportregarding advances given to certain parties for purchase of properties in the name ofcompany. Your directors wish to clarify that these advances are considered good as thecompany has clean title to the properties in terms of their purchase agreements. Courtmatters do tend to take time to resolve however the company is confident of winning thecases and hence there is no need of any provision for these loans in the accounts.
Point no. (a) the head of "Emphasis of Matter" to the main reportregarding amount given to certain parties on account of franchisee fee and other expenses.Your directors wish to state that this matter is in active progress and shall be resolved/accounted for soon as the basic rights of franchisee have been established by RealogyCorprn. in our favour without any dispute. In fact the subsidiary century 21 properties(india) Pvt. Ltd. has already commenced business using these rights.
Point no. (b) the head of "Emphasis of Matter" to the main reportregarding interest free unsecured loans given to two parties. Your directors wish to statethat the company has given these loans in accordance with agreements which inter-aliaprovide that these shall be interest free in lieu of options to convert them into equityshares at valuations which will compensate the company for the interest component. Henceno interest has been provided as due from these borrowers in these annual accounts in viewof our contractual terms of lending.
Point no. (c) the head of "Emphasis of Matter" to the main reportregarding the exceptional items of Rs. 49.02 lacs written off your Directors wish tostate that the these expenditure was incurred for improvement of leased hold buildings andduring the F.Y 2015-16 the lease has been cancelled /revoked hence this expenditure haswritten off under the head of Exceptional items.
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 4 to theDirectors 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.
EXTRACT OF ANNUAL RETURN
The particulars required to be furnished under 92(3) and Section 134(3)(a) of theCompanies Act 2013 read with Companies(Management and Administration) Rules 2014 asprescribed in Form No. MGT-9 is annexed as Annexure - 5.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
As required by Regulation 34 (2) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a detailed Management Discussion and Analysis Report ispresented in a separate section forming part of the Annual Report marked as Annexure-6.
Your Company always places major thrust on managing its affairs with diligencetransparency responsibility and accountability thereby upholding the important dictumthat an organisations corporate governance philosophy is directly linked to highperformance The Company is committed to adopting and adhering to established world-classcorporate governance practices. The Company understands and respects its fiduciary roleand responsibility towards its stakeholders and society at largeand strives to servetheir interests resulting in creation of value and wealth for all stakeholders Thecompliance report on corporate governance and a certificate from M/s. K. Singh &Associates Chartered Accountants Statutory Auditors of the Company regarding complianceof the conditions of corporate governance as stipulated under regulation 27(2) andChapter IV of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isattached herewith as Annexure-7 to this report
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY AFTERTHE CLOSE OF THE YEAR
There have been no material changes and commitments if any affecting the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financial statements relate and the date of the report.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNAL
During the financial year no order has been passed by the authorities which impacts thegoing concern status and companys operations in future.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of section 134(5) of the Companies Act 2013 your Directorsconfirm:-
1. That in the preparation of Annual Accounts the applicable accounting standards havebeen followed and there are no material departures;
2. That we have selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2016 and ofthe losses of the Company for the period ended 31st March 2016;
3. That we have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities;
4. That we have prepared the Annual Accounts on a going concern basis;
5. That we have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively;
6. That we have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Your Directors hereby express their appreciation for the cooperation and assistancereceived from stakeholders banks valued clients and business associates. Your Directorsalso wish to place on record their deep sense of appreciation for the diligent support andefforts of the employees at all levels towards the operations and growth of the Company.
| ||By Order of the Board |
| ||For ALCHEMIST REALTY LIMITED |
| ||Sd/- ||Sd/- |
| ||(Vinay Kumar Mittal) ||(Pavan Kumar Verma) |
|Dated : 10.08.2016 ||Managing Director ||Director |
|Place : New Delhi ||DIN 00287042 ||DIN 00213365 |