Associated Stone Industries (Kotah) Ltd.
|BSE: 502015||Sector: Metals & Mining|
|NSE: ASOCSTONE||ISIN Code: INE443A01030|
|BSE LIVE 15:44 | 18 Oct||41.60||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
|Mkt Cap.(Rs cr)||345|
|Mkt Cap.(Rs cr)||344.86|
Associated Stone Industries (Kotah) Ltd. (ASOCSTONE) - Director Report
Company director report
Associated Stone Industries (Kotah) Limited
The Directors have pleasure in presenting the 71st Annual Report togetherwith the Audited Financial Statements of the Company for the year ended 31stMarch 2017:
(Rs. in Lacs)
The Board in its meeting held on 30th May 2017 has recommend a finaldividend of Re.0.30 (equivalent to 30%) per equity share for the financial year 2016-17.The proposal is subject to the approval of shareholders at ensuing Annual General Meetingto be held on Friday 22nd September 2017. The total outflow as dividenddeclared (excluding dividend tax) is Rs. 248.56 Lacs against Rs. 198.85 Lacs of previousyear.
Your Directors propose to transfer Rs. 200.00 Lacs to the General Reserve Account. Anamount of Rs. 9501.10 Lacs is proposed to be retained in the Statement of Profit &Loss.
During the year under review the Company has registered total revenue from operationsof Rs. 23506.67 Lacs as against that of previous year Rs. 17201.30 Lacs and Gross Profitof Rs. 3793.87 Lacs (previous year Rs. 3903.70 Lacs). This included revenue from thetrading activity which during the year under review was Rs. 11344.74 Lacs as against Rs.4911.78 Lacs in the previous year.
The profit before taxation during the year under review was Rs. 2321.14 Lacs ascompared to Rs. 2313.07 Lacs during the previous year.
During the year under review the Company has registered total revenue from operationsof Rs 30762.89 Lacs as against that of previous year Rs. 19702.12 Lacs an increase of 36%and the profit before taxation during the year under review was Rs. 2888.38 Lacs ascompared to Rs. 1655.05 Lacs during the previous year an increase of 43%.
There are no material changes/commitments affecting financial position of the Companybetween the end of year and to the date of Report.
WIND POWER PROJECT
The Company continues to operate at its installed 3.625 MW capacity Wind Power Plantcomprising of 1.125 MW capacity at Gadag District of Karnataka and 2.50 MW capacity atSatara District of Maharashtra supplying to Electricity Boards.
During the period under review the Company has allotted 16570933 fully paid upequity shares of face value Re.1/- each to the shareholders of the Company in proportionof 1 fully paid up share for every 4 fully paid up shares and consequently the number ofshares has increased from 66283730 to 82854663.
The Company has neither issued any share with differential voting rights nor grantedany stock options/sweat equity shares.
CHANGE IN THE NATURE OF BUSINESS
The Company is mainly engaged in Mining and Processing of Kotah and Other NaturalStones. Apart from Mining Company is also engaged in generation of Wind Power and othertrading activities.
During the year under review there is no change in the nature of business of theCompany.
PERFORMANCE AND FINANCIAL STATEMENTS OF SUBSIDIARIES
As required under Regulation 33 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and Section 129 of the Companies Act 2013 theConsolidated Financial Statements prepared by the Company in accordance with theapplicable provisions of the Companies Act 2013 and applicable accounting standards formpart of the Annual Report.
The Company has foreign subsidiaries viz: ASI Global Limited Mauritius and Al RawasiRock & Aggregate LLC Fujairah UAE.
Your directors draw attention of the members to the Note No. 36 to the ConsolidatedFinancial Statements which set out salient features of Financial Statement of SubsidiaryCompanies.
DIRECTORS' RESPONSIBILITY STATEMENT
As stipulated in Section 134(5) of the Companies Act 2013 your Directors subscribe tothe "Directors' Responsibility Statement" and the Board of Directors of theCompany confirm that:
in the preparation of the annual accounts for the year ended 31stMarch 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures;
the Directors have selected such accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31stMarch 2017 and of the profit or loss of the Company for the year ended on that date;
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;
the Directors have prepared annual accounts on a 'going concern' basis;
the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS REPORTS
The Company has complied with mandatory provisions of Corporate Governance asprescribed under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
In terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Corporate Governance and Management Discussion and Analysis Reportwhich form an integral part of this Report together with the Certificate from Auditors ofthe Company regarding compliances with the requirements of Corporate Governance asstipulated in aforementioned Regulations.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per provision of Section 135 read with Schedule VII of the Companies Act 2013 alongwith the Companies (Corporate Social Responsibility Policy) Rules 2014 and any otherstatutory amendment or modification thereof and the Company's CSR Policy in respect ofCorporate Social Responsibility activity a separate Report on CSR activities is attachedas Annexure "A" to this Report. The CSR Policy has been posted on thewebsite of the Company at www.asistone.com .
The Company has made a budget of Rs. 51.00 Lacs (including short fall of Rs. 6.49 Lacsof previous year). During the year under review CSR expenditure was short by Rs. 6.81Lacs mainly on account of pending of certain proposals.
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner. Your Company periodically assessesrisks in the internal and external environment along with the cost of treating risks andincorporates risk management plans in its strategy business and operational plans.
Your Company through its risk management process strive to contain impact andlikelihood of the risks within the risk appetite as agreed from time to time with theBoard of Directors.
Your Company is having a Risk Management Committee to oversee the risk managementefforts of the Company. The details of the Committee along with its charter are set out inthe Corporate Governance Report forming part of this Report.
There are no risks which in the opinion of the Board threaten the existence of yourCompany. However some of the risks which may pose challenges are set out in theManagement Discussion and Analysis which forms part of this Report.
INTERNAL CONTROL SYSTEM AND ITS ADEQUACY
The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the Company's policies the safeguard ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of accounting records and timely preparation of reliable financialdisclosures.
DIRECTORS AND KEY MANAGERIAL PERSONNEL Number of Meetings of Board
The Board met nine times during the financial year. The meeting details are providedunder Corporate Governance Report that forms part of this Annual Report. The maximum gapbetween two board meetings did not exceed 120 days as prescribed under the Companies Act2013.
Policy of Directors' Appointment and Remuneration
The current policy is to have an appropriate mix of executive and independent directorsto maintain the independence of the board. As of 31st March 2017 the boardhad 6 members three of whom were executive or whole time and managing director and threewere independent director.
The policy of Company on director's appointment and remuneration including thecriteria for determining qualification positive attributes and other matters as requiredunder subsection 3 of section 178 of the Companies Act 2013 is available on Company'swebsite at www.asistone.com .
There has been no change in the policy. We affirm that remuneration paid to thedirectors is as per the terms laid out in the Nomination and Remuneration Policy of theCompany.
During the year under review Mr. Pramod G Lath has resigned from the Board as anIndependent Director w.e.f. 4th July 2016 and Mr. Gaurang Gandhi was appointedas an Independent Director.
In accordance with the provisions of Section 152(6)(c) of the Companies Act 2013 andArticles of Association of the Company Mrs. Anita Jatia (DIN:01068774) is liable toretire by rotation at the forth coming Annual General Meeting and being eligible hasoffered herself for re-appointment. The Board recommends her re-appointment. The briefprofile of retiring director is given in the notice calling the Annual General Meeting.
The Board of Directors on recommendation of the Nomination and Remuneration Committeehas re-designated Mr. Tushya Jatia as Whole Time Director of the Company for a period offive years w.e.f. 12th November 2016 subject to the approval of the members inthe ensuing Annual General Meeting.
Statement on declaration given by Independent Directors
The Independent directors have submitted the declaration of independence as requiredpursuant to Section 149 (7) of the Companies Act 2013 confirming that they meet thecriteria of independence provided in section 149 (6) of the Companies Act 2013 andRegulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation2015.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a structured questionnaire was prepared aftertaking into consideration various aspects of the Board's functioning composition of theBoards and its Committees culture execution and performance of specific duties andobligation and governance.
The performance evaluation of the Independent Directors was completed. The performanceevaluation of the Chairman and Non-Independent Directors was carried by the IndependentDirectors. The Board of Directors expressed their satisfaction with the evaluationprocess.
Appointment/ Cessation of KMP
During the year under review the following persons were appointed/ceased as KeyManagerial Personnel (KMP) of the Company:
AUDIT REPORTS AND AUDITORS
The Auditors' Reports for the financial year 2016-17 does not contain anyqualification reservation and adverse remark. The Auditors' Reports is enclosed with thefinancial statements in this Annual Report. During the year under review the Auditorshave not reported any matter under Section 143(12) of the Companies Act 2013.
The Secretarial Auditors' Report for the financial year 2016-17 not contain anyqualification reservation and adverse remark. The Secretarial Auditors' Report isenclosed as Annexure "B" of the Board's Report of this Annual Report.
As required by the Listing Regulations the auditors' certificate on corporategovernance is enclosed in this Annual Report. The auditors' certificates for the financialyear 2016-17 not contain any qualification reservation and adverse remark.
Under section 139 of the Companies Act 2013 and rules made thereunder it is mandatoryto rotate the statutory auditors on completion of the maximum terms permitted under thesaid section. The audit committee of the Company has proposed and on 30th May2017 the Board of Directors of the Company has recommended the appointment of M/s.S.C.Bandi & Co. Chartered Accountants (firm registration no.130850W) as the statutoryauditors of the Company.
M/s. S.C.Bandi & Co. will hold office for a period of five consecutive years fromthe conclusion of the 71st Annual General Meeting of the Company schedule to beheld on Friday 22nd September 2017 till the conclusion of the 76thAnnual General Meeting to be held in the year of 2022 subject to the approval of theshareholders of the Company.
As required under section 204 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed M/s. GMJ & Associates Company Secretaries as Secretarial Auditor of theCompany in relation to the financial year 2017-18. The Company has received their consentfor such appointment.
As per the requirement of the Central Government and pursuant to Section 148 of theCompanies Act 2013 read with Companies (Cost Records and Audit) Rules 2014 as amendedfrom time to time your Company has been carrying out audit of cost records. AccordinglyM/s. N.D. Birla & Co. a firm of Cost Accountants in practice was appointed toundertake the Cost audit for the financial year ended 31st March 2017.
Further the Board of Directors on the recommendation of the Audit Committee haveappointed M/s. N.D. Birla & Co. a firm of Cost Accountants to undertake the audit ofcost records of the Company for the financial year ended 31st March 2018.
RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the Company during the year underreview with related parties were in the ordinary course of business and on an arm's lengthbasis and do not attract the provisions of Section 188 of the Companies Act 2013. TheCompany presents a detailed landscape of all related party transactions before the AuditCommittee on quarterly basis specifying the nature value and terms and conditions of thetransaction. Transactions with related parties are conducted in a transparent manner withthe interest of the Company and Stakeholders as utmost priority. Further during the yearthe Company had not entered into any contract/ arrangement/ transaction with relatedparties which could be considered material in accordance with the policy of the Company onmateriality of related party transaction.
Since all related party transactions entered into by the Company were in ordinarycourse of business and were on arm's length basis Form AOC-2 is not applicable to theCompany.
The policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website atwww.asistone.com .
Your Directors draw attention of the members to Note No. 39 to the financial statementswhich sets out related party disclosures.
The Audit Committee comprises of Independent Directors namely Mr. Gaurang Gandhi theChairman Mr. Anshul M. Sonawala and Mr. Sanjay Seksaria as other members. All therecommendations made by the Audit Committee were accepted by the Board. The terms ofreference of audit committee and other details are explained in brief in CorporateGovernance Report.
Nomination and Remuneration Committee and its policy
The Nomination and Remuneration Committee comprises of Independent Directors namely Mr.Sanjay Seksaria the Chairman Mr. Gaurang Gandhi and Mr. Anshul M. Sonawala as members ofthe Committee. The Nomination and Remuneration policy has been posted on the website ofthe Company at www. asistone.com.
Whistle Blower Policy/Vigil Mechanism
In compliance with the requirements of Section 177 of the Companies Act 2013 theCompany has a Whistle Blower Policy to report genuine concern grievances fraud andmismanagements if any. The policy has been posted on the website of the Company atwww.asistone.com .
Particulars of Loans Guarantees or Investments by the Company
During the year the Company has provided Loans and Corporate Guarantee to itsSubsidiaries for business purpose. Please refer Note No. 12(b) for the Investment insubsidiaries Note No. 13 for Loans and Advances and Note No. 28(i) (b) (ii) for CorporateGuarantee of the financial statements.
Details of loans given to other parties during the year under review are attached as Annexure"C" to this Report.
Extract of Annual Return
The extract of the Annual Return in Form No. MGT-9 as required under Section 134(3)(a)of the Companies Act 2013 read with Rule 12 of the Companies (Management andAdministration) Rules 2014 is attached as Annexure "D" to this Report.
Investors Education and Protection Fund (IEPF)
Pursuant to the applicable provisions of the Companies Act 2013 read with IEPFAuthority (Accounting Audit Transfer and Refund) Rules 2016 all unpaid and unclaimeddividends are required to be transferred by the Company to IEPF established by the CentralGovernment after the completion of seven years. Further according to the rules theshares in respect of which dividend has not been paid or claimed by the shareholders forseven consecutive years or more shall also be transferred to the demat account created bythe IEPF Authority accordingly the Company has transferred unclaimed and unpaid dividend.Further the corresponding shares will be transferred as per the requirements of IEPFrules details of which are provided on Company's website at www.asistone.com .
Significant and material orders passed by the Regulators or Courts or Tribunals
No significant or material orders were passed by the Regulators or Courts or Tribunalswhich impact the going concern status and Company's operations in future.
Your Company has constituted an Internal Complaint Committee as required under Section4 of Sexual Harassment of Woman at Workplace (Prevention Prohibition and Redressal) Act2013. There were no incidences of sexual harassment reported during the year under review.
The Company's Equity Shares have been admitted to the depository mechanism of theNational Securities Depository Limited (NSDL) and the Central Depository Services (India)Limited (CDSL). The Company has been allotted ISIN No. INE443A01030.
The Shareholders therefore are requested to take full benefit of the same and lodgetheir holdings with Depository Participants (DPs) with whom they have their Demat Accountsfor getting their holdings in electronic form.
Conservation of Energy Technology Absorption and Foreign Exchange Earning and Outgo
As per provisions of Section 134(3)(m) of the Companies Act 2013 read with Rule 8 ofCompanies (Accounts) Rules 2014 a statement in respect of Conservation of EnergyTechnology Absorption and Foreign Exchange Earning and Outgo is attached as Annexure"E" to this Report.
Particulars of Employees
In terms of Section 197(12) of the Companies Act 2013 read with Rule 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 thestatement showing the name of the employees drawing remuneration in excess of the limitspecified in the Rules are not applicable on the Company as during the period no employeeof the Company was drawing salary in excess of the limits prescribed therein.
The information required pursuant to Section 197 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is attached as Annexure"F" to this report.
Your directors draw attention of the members to Note No. 39 to the financial statementswhich set out disclosure of remuneration to the Managing Director and Executive Director.The Remuneration policy has been posted on the website of the Company at www.asistone.com.
The Company has not accepted or renewed any deposits within the meaning of Section 73of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
Your Directors would like to acknowledge and place on record their sincere appreciationto all stakeholders clients Financial Institutions Banks Central and StateGovernments the Company's valued investors and all other business partners for theircontinued co-operation and excellent support received during the year.
Your Directors recognize and appreciate the efforts and hard work of all the employeesof the Company and their continued contribution to its progress.