The Directors of Arrow Greentech Limited (Formerly known as Arrow Coated ProductsLimited) present the 24th Annual Report on the operations of the Company together withthe Audited Accounts for the year ended 31st March 2016.
|Financial Results || |
| ||(Rupees in thousands) |
|Particulars ||2015-2016 ||2014-2015 |
|Total income ||280043 ||210553 |
|Profit (Loss) before finance cost Depreciation and Amortization expenses exceptional items & Tax ||168826 ||102684 |
|Less : Finance Cost ||- ||- |
|Less : Depreciation and Amortization expenses ||9751 ||8428 |
|Less: Exceptional items ||282 ||284 |
|Profit Before Tax (PBT) ||158793 ||93973 |
|Less : Provision for Taxation || || |
|- Current Tax ||49000 ||26500 |
|- Deferred Tax ||(603) ||1968 |
|- Fringe Benefit Tax ||- ||- |
|Profit After Tax (PAT) ||110397 ||65505 |
|Add : Balance brought forward ||64866 ||34683 |
|Less : Tax & Dividend Adjustment ||57453 ||34951 |
|Less : Tax adjustment of earlier years ||1895 ||- |
|Less : Adjustment of Depreciation ||- ||370 |
|Balance carried to Balance Sheet ||119705 ||64866 |
The total income from operations including other income for the financial year underreview amounted to Rs.2800.43 Lacs as compared to Rs. 2105.53 Lacs in the previous year.The Company has earned net profit of Rs. 1103.97 Lacs under review after providing fordepreciation of Rs. 97.51 Lacs and taxation of Rs. 483.97 Lacs. After adjustment ofbrought forward balance of Rs. 648.66 Lacs from previous year and after providing for thetax adjustment Rs. 1197.05 Lacs has been carried to the Balance Sheet.
Transfer to Reserves
The Board of Directors has not recommended transfer of any amount of profit to reservesduring the year under review. Hence the entire amount of profit for the year under reviewhas been carried to the Profit and Loss account.
Business outlook and future prospects:
Business outlook and future prospects of the Company is discussed in detail inManagement Discussion and Analysis Report attached herewith.
As you are aware your Directors had recommended Interim dividend of 30% i.e. Rs.3 perequity share of Rs.10/- each on February 6 2016 and accordingly your Directors haverecommended a final dividend of 15% i.e. Rs. 1.5 per equity share of face value Rs.10making it to a total of Rs. 4.5 per equity share of 10/- each which is 45% dividendagainst the previous years dividend of 25%. The proposed final dividend is subject to theapproval of the members at the ensuing Annual General Meeting.
Change of Name
Pursuant to the shareholders' approval obtained through postal ballot on 9th February2016 the name of the Company was changed from 'Arrow Coated Products Limited' to 'ArrowGreentech Limited' with effect from 26th February 2016.
Change in the Nature of Business
During the financial year the Company has altered the main object clause of itsMemorandum of Association by incorporating therein;
1. To carry on business of manufacturing buying selling importing exporting anddealing in Green Technology products environment friendly machines equipments patternsproducts and services including such products & services which are concerning savingearth's renewable resources and to manufacture import export and otherwise deal incoated paper films and other coated products.
2. To apply for purchase or otherwise acquire any patents patent rights copy rightstrade marks formulae licenses concessions and the like or any secret or otherinformation inventions subject to royalty or otherwise and whether exclusive ornonexclusive limited and/ or any part interest in such intellectual property rights andprivileges and to litigate defend or take such actions against infringements defiancerevocation or to protect prolong and renew legal rights and claims on intellectualproperty rights whether in India or elsewhere any trademarks patents patents rightsbrevets invention licenses protections concessions and the like conferring anyexclusive or non-exclusive or limited right to use any secret or other information as toany invention which may seem capable of being used for any of the purpose of the Companyor which may appear likely to be advantageous or useful to the Company and to useexercise develop turn to account and manufacture and to grant licenses or privileges inrespect of the same and to spend money in experimenting upon and testing and improving orseeking to improve any patents inventions secrets or rights which the Company mayacquire or propose to acquire or being interested in as licensee or otherwise.
Approval of shareholders was obtained through postal ballot on 9th February 2016 forabove amendment in the object clause of the Memorandum of Association.
Change in Registered Office
During the Financial Year the Registered Office of the company was changed from"5D Laxmi Industrial Estate New Link Road Andheri (West) Mumbai -400053" toSolitaire Corporate Park Bldg No 3 7th FloorUnit No 372 Guru Hargovindji MargChakala Andheri (East) Mumbai 400 093 w.e.f from 19th October 2015.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
Particulars of Loans Guarantees or Investments:
The company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act2013.
The details of the investments made by company is given in the notes to the financialstatements
Internal control systems and their adequacy:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board &to the Chairman & Managing Director.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
Internal Financial Controls
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and the auditor hasidentify material weakness relating to financial reporting in respect of compliance withaccounting standard in relation to discontinuing operation
Your Directors would like to state as that the Company has discontinued tradingactivities in Digital Printing Machine and Digital Signage Cutting Machine and as on 31stMar 2016 there is no item outstanding related to this business.
Corporate Social Responsibility Initiatives
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.
The CSR Policy may be accessed on the Company's website. Annual Report on CSRactivities is set out as ANNEXURE I and forms part of this report.
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
Mr. Neil Patel Whole Time Director of the Company retire by rotation at the ensuingAnnual General Meeting and being eligible offer himself for re-appointment.
Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the ListingAgreement the Board has carried out an evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Appointment &Remuneration Committees. The manner in which the evaluation has been carried out has beenexplained in the Corporate Governance Report.
During the year five Board Meetings and four Audit Committee Meetings were convened andheld. The details of which are given in the Corporate Governance Report. The interveninggap between the Meetings was within the period prescribed under the Companies Act 2013.
Further a separate Meeting of the Independent Directors of the Company was also heldon 6th February 2016 whereat the prescribed items enumerated under Schedule IV to theCompanies Act 2013 and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 were discussed.
The Audit Committee comprises Independent Directors namely of Mr. Harish Mishra Mr.Haresh Mehta and Ms. Suneeta Thakur and Executive Director Mr. Neil Patel .The Chairman ofthe Committee is Mr. Harish Mishra. All the recommendations made by the Audit Committeewere accepted by the Board.
Directors' Responsibility Statement
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) in the preparation of the annual accounts the applicable AccountingStandards(except AS-24 regarding discontinuance of operations) had been followed alongwith proper explanation relating to material departures;
ii) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are responsible and prudent so as to give a true andfair view of the state of affairs of the Company for the financial year ended on 31stMarch 2016 and of the profit/loss of the Company for the period under review;
iii) the directors had taken proper and sufficient care of the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv) the directors had prepared the accounts on a going concern basis.
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
Declaration By Independent Director(s) And Re-Appointment If Any
All the Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013 soas to qualify themselves to be appointed as Independent Directors under the provisions ofthe Companies Act 2013 and the relevant rules.
Particulars of Employees and related disclosures
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will be provided upon request. In terms of Section 136 of the Act theReport and Financial Statement are being sent to the Members and others entitled theretoexcluding the information on employees' particulars which is available for inspection bythe Members at the Registered Office of the Company during business hours on working daysof the Company up to the date of the ensuing Annual General Meeting. If any Member isinterested in obtaining a copy thereof such Member may write to the Company Secretary inthis regard.
Related Party Transactions:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large
Vigil Mechanism / Whistle Blower Policy:
The Vigil Mechanism of the Company which also in corporates a whistle blower policy interms of the Listing Agreement includes an Ethics & Compliance Task Force comprisingsenior executives of the Company. Protected disclosures can be made by a whistle blowerthrough an e-mail or dedicated telephone line or a letter to the Task Force or to theChairman of the Audit Committee. The Policy on vigil mechanism and whistle blower policymay be accessed on the Company's website at the link:http://arrowgreentech.com/Whistle-Blower-Policy.pdf
Auditors And Auditors' Report
M/s. J. A. Rajani & Co. the Statutory Auditors of the Company will hold officetill the ensuing Annual General Meeting. As per provisions of Section 139 of the CompaniesAct 2013 read with Companies (Audit and Auditors) Rules 2014 an audit firm can beappointed as Statutory Auditors of the Company only for two terms each term consisting offive consecutive years. Further the audit firm which has been occupying the office ofauditors of the Company for more than seven years prior to implementation of the CompaniesAct 2013 are eligible to hold office for additional three years only.
M/s. J. A. Rajani & Co. the Statutory Auditors of the Company who has alreadyserved as auditors of the Company for more than seven years are eligible to hold office ofauditors for three years as per provisions of Section 139 of the Companies Act 2013.Accordingly M/s. J. A. Rajani & Co Statutory Auditors of the Company who hold officeuntil the conclusion of the ensuing Annual General Meeting is proposed to be re-appointedas Statutory Auditors of the Company for the financial year 2016-17. The said Auditor havegiven a written consent and also issued Certificate pursuant to Section 139 of theCompanies Act 2013.
In respect to observations made by the Auditors in their report your Directors wouldlike to state as under:
1) The Company has discontinued trading activities in Digital Printing Machine andDigital Signage Cutting Machine and the Management of the Company and as on 31st Mar 2016there is no item outstanding related to this business.
2) Regarding payment of undisputed statutory due we state that the company is inprocess of payment of the same with appropriate authorites
3) Regarding Managerial remuneration paid during the period October 2012 - September2013 was subject to approval from the Central Government. During the year company hasreceived the order from the central government under the application made U/s 198 &309 of The Companies Act1956 with the direction to company to recover excessremuneration of Rs.1290('000) which has to be complied with as company is in process ofseeking professional / legal advice.
The Board has appointed M/s Rajendra & Co. Practising Company Secretary toconduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report forthe financial year ended March 31 2016 is annexed herewith marked as ANNEXURE II to thisReport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark.
The Company has appointed M/s. Dhaker & Kadge Chartered Accountants Mumbai asits Internal Auditor. The internal Auditor monitors and evaluates the effectiveness andadequacy of internal control system in the Company its compliances with operatingsystems accounting procedure and policies at all locations of the Company and reports thesame on quarterly basis to the Audit Committee.
Extract of Annual Return:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as " ANNEXURE III".
Management Discussion and Analysis Report and Report on Corporate Governance along witha certificate from the Auditors of the Company regarding compliance of conditions ofCorporate Governance as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 with the Stock Exchange are attached and form part ofthis Annual Report.
Conservation of Energy Technology absorption and Foreign Exchange earnings and outgo:
(a) Conservation of Energy and Technology Absorption
(i) The Company has paid special attention to the conservation of energy as a matter ofprincipal and policy. This has been reflected in the selection of equipment at the projectstage. The cost of power has kept to the minimum by optimum operation. Regular preventivemaintenance has helped to operate unit efficiently.
(ii) Additional investment and proposals if any are being implemented for reductionof Conservation of Energy.
(iii) Impact of the measures at (i) and (ii) above for reduction of energy consumptionand consequent impact on the cost of production of goods is not ascertainable.
(b) Foreign Exchange earning and outgo
|Foreign Exchange earnings || Rs. 1719.64 Lacs (previous year Rs. 1560.57Lacs) |
|Foreign Exchange outgo || Rs. 78.42 Lacs (previous year Rs. 47.84Lacs) |
Nomination and Remuneration Policy of Directors Key Managerial Personnel and OtherEmployees
In adherence of section 178(1) of the Companies Act 2013 the Board of Directors ofthe Company in its Meeting held on 11th November 2014 approved a policy on directors'appointment and remuneration including criteria for determining qualifications positiveattributes independence of a director and other matters provided u/s 178(3) based on therecommendations of the Nomination and Remuneration Committee. The broad parameters coveredunder the Policy are Company Philosophy Guiding Principles Nomination ofDirectors Remuneration of Directors Nomination and Remuneration of the Key ManagerialPersonnel (other than Managing/ Whole-time Directors) Key-Executives and SeniorManagement and the Remuneration of Other Employees.
Subsidiary Companies and Consolidated Financial Statements:
The Ministry of Corporate Affairs (MCA) vide General Circular No. 2/2011No.51/12/2007-CL-III dated 8th February 2011read with General Circular No.3/2011 No.5/12/2007-CL-III dated 21 February 2011 has granted a general exemption from attaching theBalance Sheet of Subsidiary Companies with holding Company's Balance Sheet if the holdingCompany presents in its Annual Report the Consolidated Financial Statements duly auditedby its Statutory Auditors. The Company is publishing Consolidated Financial Statements inthe Annual Report and accordingly the Company is not attaching the Balance Sheets of thesubsidiary Companies.
Further as required under the said circular a statement of financial information ofthe Subsidiary Companies viz. Arrow Green Technologies (UK) Ltd. and Arrow SecureTechnology Pvt. Ltd. and step down subsidiary companies viz. Advance IP Technologies Ltd.and Arrow Realty Ltd. (subsidiary of Arrow Green Technologies (UK) Ltd.) is attached inForm No. AOC-1 in ANNEXURE IV to this report.
The annual accounts of the above referred subsidiaries and step down subsidiary companyshall be made available to the share holders of the company on request and will also bekept open for inspection at the Registered Office of the Company during the office hourson all working days and during the Annual General Meeting and also on the Company'swebsite i.e. www.arrowgreentech.com.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statements relateon the date of this report.
2. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
3. Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
Your Directors would like to express their grateful appreciation for the assistance andco-operation received from the Financial Institution Banks Government AuthoritiesVendors and Shareholders and all organizations connected with its business during the yearunder review. Your Directors also wish to place a record their deep sense of appreciationfor the committed services of Executives Staff and Workers of the Company.
| ||For and on behalf of the Board of Directors |
|Place: Mumbai ||Shilpan P. Patel |
|Date: 14th May 2016 ||Chairman & Managing Director |
| ||DIN: 00341068 |