Your Directors have pleasure in presenting their 25th Annual Report on the business andoperations of the Company along with the Audited Financial Statement of your Company forthe financial year ended March 31 2015.
The financial performance of your Company in the year ended March 31 2015 issummarized below:
| || || |
(Rs. In Lac)
|Particulars ||2014-2015 ||2013-2014 |
|Revenue from Operations (Net of Excise Duty) ||23953.44 ||30200.99 |
|Other Income ||93.18 ||63.57 |
|Total Income ||24046.62 ||30264.56 |
|Profit for the year before Finance Costs Depreciation Prior Period adjustments Extra Ordinary Item and Taxation ||3681.01 ||3931.32 |
|Less: Finance Costs ||478.18 ||626.76 |
|Profit for the year before Depreciation Extra Ordinary Item and Taxation ||3202.83 ||3304.56 |
|Less: Depreciation and Amortisation Expenses ||606.60 ||673.17 |
|Profit for the year before Prior Period Adjustments Extra Ordinary Item and Taxation ||2596.23 ||2631.39 |
|Prior period adjustments (Expenses)/Incomes ||38.55 ||- |
|Profit for the year before Extra Ordinary Item and Taxation ||2634.78 ||2631.39 |
|Extra Ordinary Item ||- ||227.42 |
|Profit for the year before Taxation ||2634.78 ||2403.97 |
|Less: Current Tax ||806.10 ||327.06 |
|Less: Deferred Tax ||59.17 ||618.16 |
|Net Profit for the year ||1769.51 ||1458.75 |
|Add: Balance brought forward from previous year ||5622.42 ||4816.20 |
|Surplus available for Appropriation ||7391.93 ||6274.95 |
|Appropriation: || || |
|General Reserve ||150.00 ||150.00 |
|Proposed Dividend at Rs.3.50 (Previous Year Rs.3.50) per Equity Shares ||429.53 ||429.53 |
|Dividend Distribution Tax ||85.88 ||73.00 |
|Balance Carried to Balance Sheet ||6726.52 ||5622.42 |
|Total ||7391.93 ||6274.95 |
* Figures for the period prior to the appointed date i.e. April 1 2014 are notcomparable since they include figures of CPC Green division of the Company which hasbeen since demerged into AksharChem (India) Limited as per the Scheme of Arrangementapproved by the Honble High Court of Gujarat.
Your Directors are pleased to recommend final dividend of Rs.3.50 (35.00%) per equityshare on the face value of Rs.10 each subject to approval of the shareholders in theensuing Annual General Meeting.
The final dividend if declared as above would involve an outflow of Rs.430 lac towardsdividend and Rs.86 lac towards dividend distribution tax.
During the previous financial year the Company had paid a dividend of Rs.3.50 perequity share.
Transfer to Reserve
Your Company proposes to transfer Rs.150 lac (Previous Year Rs.150 lac) to the GeneralReserves. An amount of Rs.6727 lac is proposed to be retained in the Statement of Profitand Loss.
State of the Company Affairs
The year 2014-15 continued to be a challenging year. The world largest economy the USsaw better growth while the countries in the Euro zone registered marginal growth. Therewas a marked slowdown in China and Japan witnessed near stagnation. The key factors thataffected the global economy included a steep decline in oil and commodity prices. TheIndian economy too struggled with high interest cost high energy prices and depreciationof Indian Rupee. However there was persistent correction in crude oil prices.
The market of the Pthalo pigments was also sluggish during the year which challengedthe volume. During the year under review Honble High Court of Gujarat videcertified order dated November 29 2014 sanctioned the Scheme of Arrangement in the natureof demerger and transfer of enter assets and liabilities of CPC division of the Company toAksharChem (India) Limited from Appointed date April 1 2014. The Scheme have beeneffective from December 2 2014 from the date filing the certified order with theRegistrar of Companies Gujarat. Accordingly revenue for the current period does notinclude the business of CPC Green Division.
During the year under review the Company earned a total income of Rs.24047 laccompared to Rs.30264 lac in the previous year.
The total sales of the Company stood at Rs.23953 lac (Previous Year Rs.30201 lac).The profit after tax (PAT) increased by 21% from Rs.1459 lac to Rs.1770 lac in theprevious year.
During the year under review the total exports value to Rs.20533 lac compared toRs.25840 lac during the previous year. Your Company is trying to locate new exportmarkets for its products and see good potential for growth to the export business.
The Company has carried out routine modernization and improvements in the plant andincurred a capital expenditure of Rs.679 lac in the year under review compared to Rs.1740lac in the previous year.
Material Changes and Commitments if any between Balance Sheet date and date ofDirectors Report
There was no material changes and commitments between the Balance Sheet date and dateof Directors Report affecting the financial position of the Company.
Composite Scheme of arrangement and change(s) in the Nature of Business
During the year under review the Honble High Court of Gujarat vide its orderdated October 17 2014 sanctioned the Composite Scheme of Arrangement under Sections 391and 394 read with Sections 78 and 100 to 103 of the Companies Act 1956 between theCompany and AksharChem (India) Limited and their respective shareholders and creditors inthe nature of de-merger and transfer of CPC Green Division of the Company to AksharChem(India) Limited with all its assets and liabilities transferred to AksharChem (India)Limited with effect from April 1 2014 (Appointed Date). The Scheme was effective witheffect from December 2 2014 i.e. date of filing of the certified copy of the order of theHonble High Court of Gujarat with the Registrar of Companies Gujarat. Consequent tothe scheme becoming effective shareholders of the Company were allotted 5 fully paid upequity shares of Rs.10 each of AksharChem (India) Limited for every 26 equity share heldby them in the Company as on the record date i.e. February 3 2015.
However during the year under review there is no change in the nature of business.The Company continues to manufacture and exports pigments.
Authorised Share Capital
On the Scheme of Arrangement sanctioned by the Honble High Court of Gujarat inthe nature of demerger and transfer of CPC Green Division from the Company to AksharChem(India) Limited becoming effective from December 2 2014 on filing the certified truecopy of the order with Registrar of Companies Gujarat the Authorised Share Capital ofthe Company amounting to Rs.350 Lac has been transferred to AksharChem (India) Limited asper the scheme. Accordingly Authorised Share Capital of the Company has automaticallyreduced from Rs.2000 Lac to Rs.1650 lac.
a) Issue of equity Shares with differential rights
The paid up Equity Share Capital of the Company as on March 31 2015 was Rs.1227 Lac.During the year under review no equity shares with differential rights as to dividendvoting or otherwise where issued.
b) Issue of sweat equity shares
The Company has not issued any sweat equity share during the year under review.
c) Issue of employee stock options
During the year under review no Stock Options were granted vested or exercised. Nostock options are in force as on date.
Subsidiaries Joint Ventures and Associate Companies
During the year under review the Company does not have any subsidiaries jointventures and Associate Companies.
Finance And Insurance
The Company has been financed by State Bank of India for both working capital and termloans. Pursuant to Scheme of Arrangement sanctioned by the Honble High Court ofGujarat in the nature of Demerger and transfer of CPC Division to AksharChem (India)Limited term loans pertaining to CPC Green Division outstanding amounting to Rs.304 Lacas on March 31 2014 has been transferred to AksharChem (India) Limited on the appointeddate.
All assets and insurable interests of your Company including building plant andmachinery stocks vehicles stores and spares have been adequately insured againstvarious risks and perils.
CARE has reaffirmed credit rating of "CARE A+" (Single A Plus) for long termbank facility "CARE A1+" (A One Plus) for the short term bank facilities andgiven "CARE A1+" (A One Plus) for Short Term Debt (including Commercial Paper).
The Equity Shares of the Company continue to be listed on BSE Limited and NationalStock Exchange of India Limited and Listing Fees for the year 2015-16 has been paid tothem.
Particulars of Conservation of Energy Technology Absorption and foreign ExchangeEarnings and Outgo
Information pertaining to conservation of energy technology absorption and foreignexchange earnings and outgo as required under Section 134 (3) (m) of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 for the year ended March31 2015 are given as per "Annexure A" forming part of this Report.
Risk Management Policy
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks to key business objectives. Many risks identified by the business and functions aresystematically addressed through mitigating actions on a continuing basis. The Board is ofthe opinion that there are no identifiable risks which may threaten the existence of theCompany.
Evaluation of performance of all Directors of the Company is done annually. The Companyhas implemented a system of evaluating performance of the Board of Directors and itsCommittees and individual Directors on the basis of a structured questionnaire whichcomprises evaluation criteria taking into consideration various performance relatedaspects.
The Board of Directors has expressed their satisfaction with the evaluation process.
During the year under review the Company has not accepted any deposits from the publicfalling under Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014 and as such no amount of principal or interest was outstanding as onthe balance sheet date.
Policy on Appointment and Remuneration of Directors and Key Managerial Personnel
The appointment and remuneration of Directors and Key managerial Personnel is as perpolicy of your Company.
Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the ListingAgreement with Stock Exchanges the Board access and evaluate the effectiveness offunctioning of the Committees and the individual directors by seeking their inputs onvarious aspects of the Board/Committee Governance. The Nomination and RemunerationCommittee and the Board have reviewed the performance of the individual directors and theChairperson. The details of programme for familiarization of the independent directors ofyour company is available on the Companys website at www.asahisongwon.com.
The Board has on the recommendation of the Nomination and Remuneration Committee framedthe Remuneration Policy of your Company which is attached as per "Annexure B".
Particulars of Employees
The information required Section 197 of the Companies Act 2013 read with Rule 5(2) and5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isas per "Annexure - C" to this report.
Corporate Social Responsibility
In terms of the provisions of Section 135 of the Companies Act 2013 read withCompanies (Corporate Social Responsibility Policy) Rules 2014 the Board of Directors ofyour Company has constituted a Corporate Social Responsibility (CSR") Committeewhich is Chaired by Mrs. Paru M. Jaykrishna the Chairperson & Managing Director of theCompany the other members of the committee are Mr. Gaurang N. Shah and Dr. Pradeep Jhawho are independent directors of the Company. Your Company also has in place a CSR policyand the same is available on the website of the Company at www.asahisongwon.com. Thecommittee places before the Board the details of the activities to be undertaken duringthe year. A detail report is attached as "Annexure D" forming part ofthis report.
Independent Director Statement
The Company has received declarations from all its Independent Directors confirmingthat they meet the criteria of independence as prescribed under the Companies Act 2013and Clause 49 of the Listing Agreement with Stock Exchanges.
Directors and Key Managerial Personnel
Mr. Gokul M. Jaykrishna Joint Managing Director of the Company is due to retires byrotation at the ensuing Annual General Meeting in terms of Section 152(6) of the CompaniesAct 2013 and is eligible for re-appointment. The Board recommends the reappointment ofabove director of the Company.
As stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges briefprofile of the Director proposed to be reappointed nature of their expertise in specificfunctional areas names of the Companies in which he hold directorships and shareholdingare provided in the Notice attached forming part of the Annual Report.
Mr. Chandravadan R. Raval has been appointed as Chief Financial Officer of the Companyw.e.f. March 12 2015.
The composition of the Board of Directors of the Company includes a women director viz.Mrs. Paru M. Jaykrishna. Accordingly the Company is in compliance with the requirement ofSection 149(1) of the Companies Act 2013 read with Rule 3 of the Companies (Appointmentand Qualification of Directors) Rules 2014.
At the 24th Annual General Meeting held on September 26 2014 the members of theCompany had appointed existing Independent Directors viz. Mr. H. K. Khan Mr. R. K.Sukhdevsinhji Mr. Arvind Goenka Mr. Gaurang N. Shah and Dr. Pradeep Jha as IndependentDirector of the Company under the Act each for a term of five years up to the conclusionof the 29th Annual General Meeting of the Company in the calendar year 2019.
Directors Responsibility Statement
Your Directors state that;
(i) in the preparation of the annual financial statements for the year ended March 312015 the applicable accounting standards have been followed with no material departures;
(ii) the Directors have selected such accounting policies and applied them consistentlyand made 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 on March 31 2015 and of the profit orloss of the Company for the year ended on that date;
(iii) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) the Directors have prepared the annual financial statements for the year endedMarch 31 2015 on a going concern basis;
(v) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and operating effectively ;and
(vi) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
Number of Meetings of the Board of Directors
During the year under review the Board of Directors of your Company met 6 (Six) timesto deliberate on various matters details of which are given in the Corporate GovernanceReport.
The Board has constituted the Audit Committee comprises of three members:
|1 Mr. Gaurang N Shah ||Independent Director and Chairman |
|2 Mr. R. K. Sukhdevsinhji ||Independent Director |
|3 Dr. Pradeep Jha ||Independent Director |
As per the Section 177 (8) of the Companies Act 2013 the Board has accepted all therecommendations of the Audit Committee during the Financial Year 2014-15. Further detailson the Audit Committee are provided in the Corporate Governance Section of the AnnualReport.
Internal financial Controls and their Adequacy
Your company has in place adequate internal control systems commensurate with the sizeof its operations. The internal control systems comprises of policies and procedureswhich are designed for safeguarding the assets optimal utilization of resources soundmanagement of companys operations. These are continually reviewed by the Company tostrengthen the same wherever required. The internal control systems are supplemented byinternal audit carried out by an Independent Cost Accountant and periodical review bymanagement. The Audit Committee of the Board addresses issues if any raised by both theInternal Auditors and the Statutory Auditors.
Statutory Auditors and Auditors Report
In accordance with Section 139 of the Companies Act 2013 M/s. Trushit Chokshi &Associates Chartered Accountants Ahmedabad (Firm Registration No.111072W) werereappointed by the members of the Company at the 24th Annual General Meeting held onSeptember 26 2014 as Statutory Auditors of the Company for a period of 3 years to holdoffice until the conclusion of the 27th Annual General Meeting of the Company to be heldin the calendar year 2017. In accordance with the provisions of Sections 139 141 142 andother applicable provisions of the Companies Act 2013 and of the Companies (Audit andAuditors) Rules 2014 the appointment of the Statutory Auditors is required to beratified by the shareholders at every Annual General Meeting during their tenure.
M/s. Trushit Chokshi & Associates Chartered Accountants Ahmedabad have confirmedthat they are eligible for having their appointment as Statutory Auditors ratified at thisAnnual General Meeting.
Your Directors recommend the ratification of their appointment as Statutory Auditors ofthe Company for the financial year 2015-16.
The Auditors Report does not contain any qualification reservation or adverseremark on the financial statements for the year ended March 31 2015. The statements madeby the Auditors in their Report are self explanatory and do not call for any furthercomments.
Related Party Transactions
During the financial year your Company has entered into related party transactionswhich were on an arms length basis and in the ordinary course of business. TheCompany has not entered into any transaction with any related party which could beconsidered material in accordance with the Listing Agreement and the Policy of the Companyon materiality of related party transactions. All related party transactions have beenapproved by the Audit Committee of the Board of Directors of the Company and the same arebeing reviewed by it on a periodic basis. The Policy on the Related Party Transactions asapproved by the Audit Committee and the Board of your Company is posted on theCompanys website www.asahisongwon.com. The details of contracts and arrangement withrelated parties of your Company for the financial year ended March 31 2015 is given inNote No. 32 to the financial statements. Form AOC-2 pursuant to Section 134 (3) (h) of theCompanies Act 2013 read with Rule 8(2) of the Companies (Accounts) Rules 2014 is set outas "Annexure E" to this Report.
Extract of Annual Return
In terms of the provisions of Section 92 (3) of the Companies Act 2013 read withCompanies (Management and Administration) Rules 2014 an extract of the Annual Return ofthe Company for the financial year ended March 31 2015 in Form MGT 9 is annexedherewith as "Annexure F".
Particulars of loans Guarantees or Investments
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 read with Companies (Meeting of Board and its Powers)Rules 2014 are given in the Note to the Financial Statements.
Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Bipin L. Makwana Company Secretary in practice to undertake the SecretarialAudit of the Company. The Secretarial Audit Report is annexed herewith an "Annexure G".
The Secretarial Auditors Report does not contain any qualification reservation oradverse remark and is self explanatory and thus does not require any furthercomments.
During the year under review cost audit was not applicable to the Company.
Significant an material orders passed by the regulations / courts / tribunals impactingthe going concern status and the Companys operation in future
There were no significant and material orders passed by the regulator or court ortribunals impacting the going concern status of the Company and its operations in future.
Vigil mechanism and whistle blower policy
In compliance with the provisions of Section 177 (10) of the Companies Act 2013 andClause 49 of the listing Agreement with the Stock Exchanges your Company has in place avigil mechanism for the directors and employees to report concerns about unethicalbehaviour and actual or suspected fraud or violation of your Company Code of Conduct. TheCompany has established a Vigil Mechanism and Whistleblower Policy for the Directors andemployees and same is posted on the website of the Company at www.asahisongwon.com.
Disclosure under the sexual harassment of women at work place (prevention prohibition& redressal) Act 2013
The Company has in place a Policy on prevention of Sexual Harassment in line with therequirements of the Sexual Harassment of Women at the Workplace (Prevention Prohibition& Redressal) Act 2013. During the year under review the Company had not received anycompliant.
Management discussions and analysis report
A detailed review of operations performed and future outlook of your Company andbusiness is given in the Management Discussion and Analysis Report as stipulated underClause 49 of the Listing Agreement with the Stock Exchange(s) is presented in"Annexure H" a separate section forming part of the DirectorsReport.
Your Company has been practicing principle of Corporate Governance over the years.During the year under review your Company was in compliance with the provisions of Clause49 of the Listing Agreement with the Stock Exchange(s) pertaining to the corporategovernance compliances. The Report on Corporate Governance as stipulated under Clause 49of the Listing agreement forms part of this Annual Report.
M/s. Trushit Chokshi & Associates Chartered Accountants Ahmedabad StatutoryAuditors of the Company certificate confirming compliance with the Clause 49 of theListing Agreement with the Stock Exchange(s) is set out in the "Annexure - I"forming part of this report.
Transfer to investor education and protection fund
As provided in Companies Act dividend amount which was due and payable and remainedunclaimed for a period of seven years has to be transferred to Investor Education &Protection Fund.
The Company has transferred an amount of Rs.68714/- remaining unclaimed wastransferred to Investor Education and Protection Fund (IEPF) during the year.
Human Resources and Industrial Relations
The industrial relations of the Company during the year continued to be cordial andamicable. Your Directors wish to place on record their sincere appreciation for thedevoted services of all the employees and workers of the Company.
Environment Health and Safety
Your Company continues to give greater importance to health and safety of its employeesand its neighbourhood. Safety and environmental standards are periodically reviewed andupgraded. The Company preserves in its efforts to educate safe and environmentallyaccountable behavior in every employee as well as its vendors.
The solid waste generated at the Works after treatment of its liquid effluent isshifted to a Gujarat Pollution Control Board (GPCB) approved site.
The Company has maintained a greenbelt around its sites as a part of its commitment toenvironment management.
The Company continues to demonstrate its commitment to a clean and safe environment.The state of the art effluent treatment plant continues to run satisfactorily so that thetreated wastewater discharged is well within the stipulated norms set by GPCB. As a partof water conservation efforts the Company has implemented suitable engineering solutionto utilize recycled water as much as possible in cleaning gardening and other utilities.
Your Company has ISO 14001:2004 certification of its both Units and ISO 9001-2008 forquality management system.
Appreciation and Acknowledgements
Your Directors would like to express their appreciation for the assistance andcooperation received from the Government of India Government of Gujarat Electricitysupply companies and Bankers during the year under review.
The Company is thankful to the shareholders for reposing trust in the Company and theirunflinching enthusiasm and patronage.
| ||For and on behalf of the Board of Directors |
|Place: Ahmedabad ||MRS. PARU M. JAYKRISHNA |
|Date: August 12 2015 ||Chairperson & Managing Director |
| ||DIN No. 00671721 |
167-168 Village Indrad
Kadi Kalol Road Dist: Mehsana
Gujarat 382 715 (India)
OVERVIEW REPORTS STATEMENTS
ANNEXURE "A" TO THE DIRECTORS REPORT
Information required under Section 134(3)(m) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rule 2014 pertaining to Conservation of EnergyTechnology Absorption foreign Exchange Earnings and Outgo.
A. Conservation of Energy
(i) The steps taken or impact on conservation of energy: The Companysmanufacturing facility at Padra Vadodara has taken various initiative for saving energyconsumption. The Company regularly benchmarks it energy conservation levels andconsistently work towards improving efficiencies towards getting the cost of energy downto every unit produced. Both units have strong team headed by senior personnel tocontinuously monitor energy consumption. Efforts have been taken to up grade plant andmachinery. The Company has five DG set installed at Vadodara plant out of which two is of1010 KVA two of 700 KVA and one 500 KVA. The Company has also undertaken variousinitiatives towards green energy thereby contributing towards clean environment.
(ii) The steps taken by the Company for utilizing alternative sources of energy: Toconserve energy the Company has one windmill with total installed capacity of 600 KW WTGwhich will help to generate energy through environmental friendly measure and also reducecarbon emission in the atmosphere.
(iii) The Capital investment on energy conservation equipment: The Company has notinvested on energy conservation equipment during the year under review.
B. Technology Absorption
(i) The efforts made towards technology absorption: The Company has taken initiativesfor training the technical persons with latest technology. The Research and Developmentcentre of the Company is recognized by the Ministry of Science and Technology Governmentof India.
The centre is engaged in development of new product cost effective technology forexisting and new product which are environment friendly reduction back cycle time.
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution:
The above efforts have improved the quality of the product and improved theproductivity and reduced wastages.
(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year):
|a The details of technology imported ||Nil |
|b The year of Import ||Not Applicable |
|c Whether the technology been fully absorbed ||Not Applicable |
|d If not fully absorbed areas where absorption has not taken place and the reasons thereof ||Not Applicable |
(iv) The Expenditure incurred on Research and Development:
| || || |
(Rs. in lac)
| ||2014-2015 ||2013-2014 |
|Capital ||2.41 ||11.36 |
|Recurring ||16.99 ||19.04 |
|Total ||19.40 ||30.40 |
|Total Research and Development Expenditure as percentage of total turnover ||0.08 ||0.10 |
C. foreign Exchange Earnings and Outgo
a. Activities relating to Exports initiatives taken to increase exports developmentof new export markets for products and service and export plans:
The Company is an export oriented company where 87% of the total turnover comes fromExports. During the year under review the Company exported pigments (Blue) valuing (FOB)Rs.20338 Lac (previous year Rs.25643 Lac) to various countries around the World. TheCompany is global phthalocyannie pigment exporter to various countries major to EuropeUSA and Asian Markets. Your Company is constantly exploring new markets to enhance theexports of its products.
b. foreign Exchange used and earned:
| || || |
(Rs. in lac)
| ||2014-2015 ||2013-2014 |
|Foreign Exchange Earned (FOB) ||20337.80 ||25643.45 |
|Foreign Exchange Used ||5164.57 ||6660.73 |
ANNEXURE "B" TO THE DIRECTORS REPORT
NOMINATION AND REMUNERATION POlICY
The Nomination and Remuneration Policy is being formulated in compliance with Section178 of the Companies Act 2013 read along with the applicable rules thereto and Clause 49of the Listing Agreement with the Stock Exchange(s). The Policy on nomination andremuneration of Directors Key Managerial Personnel and Senior Management has beenformulated by the Nomination and Remuneration Committee and has been approved by the Boardof Directors of the Company.
The objective of the policy is to ensure that:
the level and composition of remuneration is reasonable and sufficient toattract retain and motivate directors of the quality required to run the Companysuccessfully;
relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and
remuneration to directors key managerial personnel and senior managementinvolves a balance between fixed and incentive pay reflecting short and longtermperformance objectives appropriate to the working of the Company and its goals.
A. Remuneration to Managing Director / Whole time Directors:
The remuneration / commission etc to be paid to Managing Director / Whole timeDirectors etc shall be governed as per provisions of the Companies Act 2013 and rulesmade there under or any other enactments for the time being in force and the approvalsobtained from the Members of the Company.
The Nomination and Remuneration Committee shall make such recommendations to the Boardof Directors as it may consider appropriate with regard to remuneration to ManagingDirector / Wholetime Director.
B. Remuneration to Non-Executive / Independent Directors:
The Non-Executive / Independent Directors may receive sitting fees and suchother remuneration as permissible under the provisions of the Companies Act 2013.
The amount of sitting fees shall be such as may be recommended by the Nominationand Remuneration Committee and approved by the Board of Director of the Company.
All the remuneration of the Non-Executive/Independent Directors (excludingremuneration for the attending the meetings as prescribed under Section 197 (5) of theCompanies Act 2013) shall be subject to ceiling / limits as provided under Companies Act2013 and rules made there under or any other enactment for the time being in force. Theamount of such remuneration shall be such as may be recommended by the Nomination andRemuneration Committee and approved by the Board of Directors or shareholders as the casemay be.
An Independent Director shall not be eligible to get Stock Options and also shall notbe eligible to participate in any share based payment schemes of the Company.
C. Remuneration to Key Managerial Personnel and Senior Management:
o The remuneration to Key Managerial Personnel and Senior Management shall consist offixed pay and incentive pay in compliance with the provisions of the Companies Act 2013and in accordance with the Companys policy.
o A committee of the Company constituted for the purpose of administering the EmployeeStock Options shall determine the stock options and other share based payments to be madeto Key Managerial Personnel and Senior Management.
o The Fixed pay shall include monthly remuneration employers contribution toProvident Fund contribution to pension fund pension scheme etc. as decided from time totime.
o The incentive pay shall be decided based on the balance between performance of theCompany and performance of the Key Managerial Personnel and Senior Management to bedecided annually or such interval as may be consider appropriate.
The policy shall be reviewed by the Nomination and Remuneration Committee and the Boardfrom time to time as may be necessary.
ANNEXURE "C" TO THE DIRECTORS REPORT
Details pertaining to remuneration as required under Section 197 (12) of the CompaniesAct 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are given below:
i. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
(Rs. in Lac)
|Sr. No. Particulars ||Remuneration for the year ended March 31 2015 ||Ratio of Remuneration to median remuneration of employees |
|1 Mrs. Paru M. Jaykrishna ||65.75 ||27.81 |
|Chairperson & Managing Director || || |
|2. Mr. Gokul M. Jaykrishna ||44.85 ||18.97 |
|Joint Managing Director || || |
|3. Mr. Munjal M. Jaykrishna ||35.00 ||14.81 |
|Joint Managing Director || || |
ii. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year:
|Directors Chief Executive Officer Chief financial Officer and Company Secretary ||% increase/(decrease)* in remuneration in the financial year |
|Mrs. Paru M. Jaykrishna ||(39.31) |
|Mr. Gokul M. Jaykrishna ||(27.75) |
|Mr. Munjal M. Jaykrishna ||(43.83) |
|Mr. H. K. Khan ||Not Applicable |
|Mr. R. K. Sukhdevsinhji ||Not Applicable |
|Mr. Arvind Goenka ||Not Applicable |
|Mr. Gaurang N. Shah ||Not Applicable |
|Dr. Pradeep Jha ||Not Applicable |
|Mr. Chandravadan R. Raval CFO# ||0.87 |
|Mr. Saji V. Joseph Company Secretary ||19.90 |
*The Company has recovered excess remuneration paid to Managing Directors during thefinancial year 2013-14 hence the remuneration paid to Managing Directors has decreased.
#Mr. Chandravadan R. Raval was appointed as CFO of the Company w.e.f. March 12 2015
iii. The percentage increase in the median remuneration of employees in the financialyear: During the year under review there was an increase of 6% in the median remunerationof employees.
iv. The number of permanent employees on the rolls of Company: There were 139 permanentemployees on the rolls of the Company as on March 31 2015.
v. The explanation on the relationship between average increase in remuneration andCompany performance: Increase in remuneration is linked to the Company performance throughperformance appraisal system. The profit before tax increased by 9.60% whereas theincrease in the median remuneration was 6%. The average increase in median remunerationwas in line with the performance of the Company.
vi. Comparison of the remuneration of the key managerial personnel against theperformance of the Company:
|Aggregate remuneration of key managerial personnel (KMP) in FY15 (Rs. Lac) ||153.48 |
|Revenue (Rs. Lac) ||23953.44 |
|Remuneration of KMPs (as % of revenue) ||0.64 |
|Profit before Tax (PBT) (Rs. Lac) ||2634.77 |
|Remuneration of KMP (as % of PBT) ||5.83 |
vii. Variations in the market capitalisation of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year:
|Particulars ||March 31 2015 ||March 31 2014 ||% Change |
|Market Capitalisation (Rs. Lac) ||1397 ||1006 ||39 |
|Price Earnings Ratio ||7.89 ||5.98 ||32 |
viii. Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last publicoffer: The Company had come out with initial public offer (IPO) in 2007 at a premium ofRs.80/- per share and face value Rs.10/- per share. The equity share of face value Rs.10/-per share closed at Rs.113.80 on BSE Limited and Rs.114.15 on National Stock Exchange ofIndia Limited on March 31 2015 representing an increase of 26% (BSE) since the date oflast public issue.
ix. Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration: The averagepercentage of increase made in the salaries of employees other than the managerialpersonnel in the year under review was 6%. whereas there is decrease in managerialremuneration. The criteria for increase in remuneration of employees other than managerialpersonnel is based on internal performance appraisal by the management annually which arebased on the overall performance of the Company.
x. Comparison of each remuneration of the key managerial personnel against theperformance of the Company:
| ||Mrs. Paru M. Jaykrishna Chairperson & Managing Director ||Mr. Gokul M. Jaykrishna Joint Managing Director ||Mr. Munjal M. Jaykrishna Joint Managing Director ||Mr. Saji V. Joseph Company Secretary |
|Remuneration during the year under review (Rs. Lac) ||65.75 ||44.5 ||35.00 ||7.78 |
|Revenue (Rs. in Lac) ||23953.44 |
|Remuneration as % of revenue ||0.27 ||0.19 ||0.15 ||0.03 |
|Profit before Tax (PBT) Rs. (in Lac) ||2634.70 |
|Remuneration (as % of PBT) ||2.50 ||1.70 ||1.33 ||0.30 |
xi. The key parameters for any variable component of remuneration availed by thedirectors: Remuneration of the Directors do not have variable component and are consideredby the Board of Directors of the Company based on the recommendation of the Nomination andRemuneration Committee and as per the Remuneration Policy of the Company for DirectorsKey Managerial Personnel and other employees.
xii. The ratio of the remuneration of the highest paid director to that of theemployees who are not directors but receive remuneration in excess of the highest paiddirector during the year: None.
xiii. Affirmation that the remuneration is as per the remuneration policy of theCompany: It is herby affirmed that remuneration paid is as per the Nomination andRemuneration Policy for Directors Key Managerial Personnel and other Employees.
B. Statement containing the particulars of employees in accordance with Rule 5(2) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rule 2014
Information showing names and other particulars of employees who were employedthroughout the year and were in receipt of remuneration in aggregate of not less thanRs.6000000/- for financial year.
|Name of the employee ||Designation ||Qualification ||Age (years) ||Joining date ||Experience (years) ||Gross remuneration (rs. In lac) ||Last employment ||Last designation ||% of equity shares held |
|Mrs. Paru M. Jaykrishna ||Chairperson & Managing Director ||MA LLB ||73 ||Since Inception ||46 ||65.75 ||Skyjet Aviation Pvt Ltd ||Managing Director ||37.74 |
1. The Gross remuneration includes Salary Commission and taxable value of Perquisites.
2. Nature of employment is contractual and renewable.
3. No Employees other than Managing Directors hold more than 2% of the equity shares ofthe Company along with their spouse and dependent children.
ANNEXURE "D" TO THE DIRECTORS REPORT
ANNUAl REPORT ON CORPORATE SOCIAl RESPONSIBIlITY ACTIVITIES
1. A brief outline of the Companys CSR policy including overview of projects orprogrammes proposed to be undertaken and a reference to the web-link to the CSR policy andprojects or programmes
The Company CSR policy has been prepared in accordance with Section 135 CompaniesAct 2013 and rules framed there under. The CSR Policy of the Company focuses on thefollowing:-
To take up programmes that benefit the communities where it operates inenhancing the quality of life & economic well being of the local populace.
To serve the socially and economically weak disadvantaged underprivileged anddestitute sections of the Society regardless of age class colour culture disabilityethnicity family structure gender marital status nationality origin race or religionwith intention to make the group or individual self dependent and live life moremeaningfully.
To extend humanitarian services in the community to further enhance the qualityof life like health facilities education basic infrastructure facilities to local areasthat have so far not been attended to.
To generate through its CSR initiatives a community goodwill for the Companyand help reinforce a positive & socially responsible image of the Company as acorporate entity.
2. Composition of the CSR Committee:
The CSR Committee comprises of the following directors:
|1. Mrs. Paru M. Jaykrishna ||Chairperson |
|2. Mr. Gaurang N. Shah ||Member |
|3. Dr. Pradeep Jha ||Member |
3. Average net profit of the Company for last three financial years (2011-12 to2013-14):Rs. 1581.84 Lac
4. Prescribed CSR Expenditure (two percent of the amount as in item 3 above):Rs. 31.64Lac
5. Details of CSR spend for the financial year:
a) Total Amount to be spent for the financial year: Rs.31.64 Lac
b) Amount unspent if any: Rs.31.64 Lac
c) Manner in which the amount spent during the financial year is detailed below: Nil
6. Reason for not spending the amount at 5(c):
During the year the Company has not spent any entitlement on CSR activities theCompany would like to submit that this being the first year of structured implementationof CSR initiatives considerable time was spent on deciding on the CSR projects suitableand putting systems in place to ensure effective implementation of CSR initiatives. Anumber of initiatives pertaining to the identified CSR projects are still in the conceptstage while the Company is continuing to fine-tune the execution process. Hence theCompany was unable to spend the entire prescribed amount of Rs.31.64 lac during thefinancial year 2014-15. The Company is committed to the underlying intent of CSR and isoptimistic of meeting its obligations under Section 135 of the Companies Act 2013 andthereby make a positive impact on the society.
7. The CSR Committee of the Company hereby confirms that the implementation andmonitoring of CSR policy is in compliance with CSR objective and policy of the Company.
|Mrs. Paru M. Jaykrishna ||Mr. Gokul M. Jaykrishna |
|Chairperson of the CSR Committee ||Joint Managing Director |
|DIN No. 00671721 ||DIN No. 00671652 |
|Place: Ahmedabad || |
|Date: August 12 2015 || |
ANNEXURE "G" TO THE DIRECTORS REPORT
SECRETARIAl AUDIT REPORT
For the financial year ended 31st March 2015
[Pursuant to section 204(1) of the Companies Act 2013 and Rule No.9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014]
Asahi Songwon Colors limited
I have conducted the Secretarial Audit of the compliance of applicable statutoryprovisions and the adherence to corporate practices by ASAHI SONGWON COLORS LIMITED(hereinafter called the Company) for the audit period covering the financialyear ended on 31st March 2015. Secretarial Audit was conducted in a manner that providedme a reasonable basis for evaluating the corporate conducts / statutory compliances andexpressing my opinion thereon.
Based on our verification of the Companys books papers minute books forms andreturns filed and other records maintained by the Company and also the informationprovided by the Company its officers agents and authorized representatives during theconduct of Secretarial Audit; I hereby report that in my opinion the Company has duringthe audit period generally complied with the statutory provisions listed hereunder andalso that the Company has proper Board-processes and compliance mechanism in place to theextent in the manner and subject to the reporting made hereinafter.
I have examined the books papers minute books forms and returns filed and otherrecords maintained by the Company for the financial year ended on 31st March 2015according to the provisions of:
(i) The Companies Act 2013 (the Act) and the rules made thereunder;
(ii) The Securities Contracts (Regulation) Act 1956 (SCRA) and the rules madethereunder;
(iii) The Depositories Act 1996 and the regulations and bye-laws framed thereunder;
(iv) Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of overseas direct investment and external commercial borrowings;(Not applicable during the audit period);
(v) The following regulations and guidelines prescribed under the Securities andExchange Board of India Act 1992 (SEBI Act):
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992;
(c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009; (Not applicable during audit period);
(d) The Securities and Exchange Board of India (Employee Stock Option Scheme andEmployee Stock Purchase Scheme) Guidelines 1999; (Not applicable during audit period);
(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities)Regulations 2008; (Not applicable during audit period);
(f) The Securities and Exchange Board of India (Registrars to an Issue and ShareTransfer Agents) Regulations 1993 regarding the Companies Act and dealing with client;
(g) The Securities and Exchange Board of India (Delisting of Equity Shares)Regulations 2009 (Not applicable during audit period);
(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations1998 (Not applicable during audit period);
(vi) Other laws as applicable specifically to the Company broadly covering pollutionlaws manufacturing laws safety laws and other general and commercial laws includingindustrial laws labour laws.
I have also examined compliance with the applicable clauses of the following;
(i) Secretarial Standards issued by The Institute of Company Secretaries of India (Notnotified during the audit period and hence not applicable);
(ii) Listing Agreements entered into by the Company with the Stock Exchanges.
I report that during the year under audit the Company has generally complied with theprovisions of the Act rules regulations guidelines etc. as mentioned above.
I further report that based on the information provided by the Company its officersthere exists adequate systems process and control commensurate with the size andoperation of the Company to monitor and ensure compliance of other laws. I have notreviewed the compliance by the company of applicable financial laws like direct andindirect tax laws as the same has been reviewed by the other designated professionals.
I further report that the Board of Directors of the Company is duly constituted withproper balance of Executive Directors Non- Executive Directors and Independent Directors.The changes in the composition of the Board of Directors that took place during the periodunder review were carried out in compliance with the provisions of the Act.
Adequate notice is given to all Directors to schedule the Board meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting.
Decisions at the meetings of the Board of Directors of the Company were carried throughon the basis of majority. There were no dissenting views by any member of the Board ofDirectors during the period under review.
I further report that there are adequate systems and processes in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines referred to above.
I further report that during the audit period there were following specificevent/action having a major bearing on the Company s affairs in pursuance to theabove referred laws rules regulations guidelines etc referred to above.
(i) Demerger and transfer of CPC Green Division of the Company with AksharChem (India)Limited and consequential restructuring in share capital of the company pursuant toComposite Scheme of arrangement as approved by the Honble High Court of Gujaratbetween the Company and AksharChem (India) Limited.
(ii) In the annual general meeting of the Company held on 26/09/2014 the Consent ofthe Company has been given to the Board of Directors to borrow moneys and mortgaging/charging of properties of the company pursuant to Section 180 (1) (c) & (a)respectively of the Companies Act 2013.
| ||Bipin l. Makwana |
|Place: Ahmedabad ||Company Secretary in Practice |
|Date: 12/08/2015 ||ACS 15650/ C. P. No.5265 |