Balkrishna Paper Mills Ltd
Your directors have pleasure in presenting their Fourth Annual Report together with theAudited Statements of accounts for the Financial Year ended 31st March 2017.
1. FINANCIAL STATEMENTS & RESULTS:
a. FINANCIAL SUMMARY OR HIGHLIGHTS/ PERFORMANCE OF THE COMPANY (STANDALONE)
| || ||(Rs. in crore) |
|Particulars ||Current Year ended 31.03.2017 ||Previous Year ended 31.03.2016 |
|Gross Turnover and Other Income ||195.50 ||168.02 |
|Less: Excise Duty Recovered on Sales ||11.48 ||9.31 |
|Net Turnover and Other Income ||184.02 ||158.71 |
|Gross Profit/(Loss) ||(15.68) ||(13.14) |
|Less: Depreciation and Amortisation ||5.77 ||3.66 |
|Exceptional item ||- ||43.70 |
|Profit/(loss) before Tax ||(21.45) ||26.90 |
|Less: Provision for Taxation || || |
|Current Tax (MAT) ||- ||5.95 |
|Deferred Tax (Net) ||3.96 ||4.47 |
|Profit after Tax ||(25.41) ||16.48 |
|Balance brought forward from last year ||13.44 ||(3.10) |
|Income tax of earlier year ||0 ||(.06) |
|PROFIT AVAILABLE FOR APPROPRIATIONS: ||(11.97) ||13.44 |
|APPROPRIATIONS: || || |
|Proposed Dividend (including Tax on Dividend) ||0.00 ||0.00 |
|Balance Carried Forward to Balance Sheet ||(11.97) ||13.44 |
During the year under review the Gross turnover and other Income of your Companyincreased to Rs. 195.50 Crore from Rs. 168.02 Crore in the previous year. The net Lossafter tax stood at Rs. 25.41 Crore against Profit of Rs. 16.48 Crore in the previous year.
c. REPORT ON PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES:
Your Directors have not recommended any dividend for the financial year under review
e. SHARE CAPITAL:
The paid up Share Capital of the Company as on 31st March 2017 was Rs. 10.74 Crore. Ason 31st March 2017 none of the Directors of the Company hold convertible instruments.
f. REVISION OF FINANCIAL STATEMENT:
There was no revision of the financial statements for the year under review.
The Company has not accepted or renewed any amount falling within the purview ofprovisions of Section 73 of the Companies Act 2013 ("the Act") read with theCompanies (Acceptance of Deposit) Rules 2014 during the year under review. There were nounclaimed deposits or interest thereon as on 31st March 2017. Hence the requirement forfurnishing of details of deposits which are not in compliance with the Chapter V of theAct is not applicable.
h. BRIEF DESCRIPTION OF THE COMPANY WORKING DURING THE YEAR/STATE OF COMPANY'S AFFAIR
The Company is engaged in manufacturing of "Coated Duplex Boards" segment.The applications of the Coated Boards are well diversified and ever expanding. Thissegment of the industry has witnessed a healthy growth over the past decade and isexpected to continue to grow annually at a rate approximately 9%
The production for the year under review was 59607 MT and sales was 58823 M.T.
i. DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT 2013:
There were no material changes and commitments which could affect the Company'sfinancial position have occurred between the end of the financial year of the Company anddate of this report.
j. INTERNAL CONTROL SYSTEM
Your company has adequate system of internal control to ensure that all the assets aresafeguarded and are productive. Necessary checks and controls are in place to ensure thattransactions are properly verified adequately authorised correctly recorded and properlyreported.
During the year under review no material or serious observation has been received fromthe Internal Auditors of the Company for inefficiency or inadequacy of such controls.
k. DISCLOSURE OF ORDERS PASSED BY REGULATORS OR
Courts or Tribunal
During the year under review there were no orders have been passed by any Regulator orCourt or Tribunal which can have impact on the going concern status and the Company'soperations in future.
l. PARTICULARS OF LOANS GUARANTEES INVESTMENTS AND SECuRITIES:
During the year under review there are no loans guarantees investments andsecurities provided by the Company.
m. DISCLOSURE UNDER SECTION 43(a)(ii) OF THE COMPANIES ACT 2013:
The Company has not issued any shares with differential rights and hence no informationas per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies(Share Capital and Debenture) Rules 2014 is furnished.
n. DISCLOSURE UNDER SECTION 54(1)(d) OF THE COMPANIES ACT 2013:
The Company has not issued any sweat equity shares during the year under review andhence no information as per provisions of Section 54(1)(d) of the Act read with Rule 8(13)of the Companies (Share Capital and Debenture) Rules 2014 is furnished.
o. DISCLOSURE UNDER SECTION 62(1)(b) OF THE COMPANIES ACT 2013:
The Company has not issued any equity shares under Employees Stock Option Scheme duringthe year under review and hence no information as per provisions of Section 62(1)(b) ofthe Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules 2014 isfurnished.
p. DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT 2013:
During the year under review there were no instances of non-exercising of votingrights in respect of shares purchased directly by employees under a scheme pursuant toSection 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures)Rules 2014 is furnished.
q. CORPORATE GOVERNANCE:
A report on Corporate Governance as stipulated under Uniform Listing Agreement with theStock Exchange(s)/ SEBI (LODR) Regulations 2015 forms part of the Annual Report.Certificate from the Auditors of the Company confirming compliance of conditions ofCorporate Governance as stipulated under the aforesaid Para forms part of the AnnualReport.
r. EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) of the Companies Act 2013 Extract ofthe Annual Return for the financial year ended 31st March 2017 made under the provisionsof Section 92(3) of the Act is attached as Annexure I which forms part of this Report.
s. RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were inthe ordinary course of business and were on an arm's length basis. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other related parties which may have a potential conflict with theinterest of the Company at large.
All related party transactions for the year are placed before the Audit Committee aswell as before the Board for approval. The transactions entered into with related partiesare reviewed on a quarterly basis by the Audit Committee.
The policy on Related Party Transactions as approved by the Audit Committee and Boardis uploaded on the Company's website at the link www.bpml.in under the head Investorrelations.
The details of the transactions with Related Parties to be provided in Form AOC-2 isannexed herewith as Annexure-II.
Members can refer to Note No. 37 to the Financial Statements which set out relatedparty disclosures.
t. INDUSTRIAL RELATIONS:
Industrial relations with staff and workmen during the year under review continued tobe cordial.
2. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act 2013 ShriAnurag P. Poddar Chairman and Managing Director retire by rotation at the forthcomingAnnual General Meeting and being eligible offer himself for re-appointment.
b. DECLARATIONS BY INDEPENDENT DIRECTORS:
The Company has received declarations from all the Independent Directors under Section149(6) of the Companies Act 2013 confirming their independence vis-a-vis the Company.
3. DISCLOSURES RELATED TO BOARD COMMITTEES AND POLICIES:
a. BOARD MEETINGS:
The Board of Directors met 4 times during the year on the following dates in accordancewith the provisions of the Companies Act 2013 and rules made thereunder.
May 7 2016 July 29 2016 November 12 2016 and February 4 2017.
b. DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the Company for the year ended 31st March 2017 the Board ofDirectors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures
b. such accounting policies have been selected and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at 31st March 2017 and ofthe Profit of the Company for that year;
c. the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively;
c. NOMINATION AND REMUNERATION COMMITTEE:
The composition role terms of reference as well as powers of the Nomination andRemuneration Committee of the Company meets the requirements of Section 178 of theCompanies Act 2013 and Regulation 19 of the SEBI (LODR) Regulations 2015.
The Committee comprises of 3 Independent Directors.
The composition of the Nomination and Remuneration Committee category of memberstheir attendance at the Committee Meetings held during the year under review is given inthe table below:
|Sr. No. ||Name of the Director ||Category || |
Number of Meetings *
| || || ||Held ||Attended |
|1 ||Shri Sachindra Nath Chaturvedi (Chairman) ||Independent Director ||- ||- |
|2 ||Shri Harish N. Motiwalla ||Independent Director ||- ||- |
|3 ||Shri Rakesh N. Garodia ||Independent Director ||- ||- |
* During the year no meeting was held.
The Company follows a policy on remuneration of Directors and Senior ManagementEmployees as enumerated below:
Remuneration of Non-Executive Directors:
The Nonexecutive Directors shall be entitled to receive remuneration by way of sittingfees reimbursement of expenses for participation in Board/Committee meetings andcommission if any after approval of the members.
Remuneration of Chairman/Managing Director/Whole Time Directors:
1) At the time of appointment or re-appointment of the Managing Director & CEO/Whole Time Directors such remuneration shall be paid as may be mutually agreed betweenthe company (which includes the Nomination and Remuneration Committee and the Board ofDirectors) and the Chairman & Managing Director/Whole-time Directors within theoverall limits prescribed under the Companies Act 2013.
2) The remuneration shall be subject to the approval of the Members of the Company inGeneral Meeting.
3) The remuneration of the Managing Director/Executive Director/Whole-time Director arebroadly divided into Basic Salary Allowances perquisites amenities retirement benefitsand commission.
4) In determining the remuneration the Nomination and Remuneration Committee shallensure/consider the following:-
a. The relationship of remuneration and performance benchmark is clear.
b. Responsibility required to be shouldered by the Chairman & Managing Directors& Whole-time Director the industry benchmarks and the current trends.
c. The company's performance vis-a-vis the annual budget achievement and individualperformance vis-a-vis the KRAs/KPIs.
Remuneration of Senior Management Employees:
1. In determining of Senior Management employees i.e. KMPs the Nomination andRemuneration Committee shall ensure/consider the following:
a. The relationship and performance benchmark is clear.
b. The remuneration including annual increment is decided based on the critically ofthe roles and responsibilities the Company's performance vis-a-vis the annual budgetachievement individual performance vis-a-vis KRAs/ KPIs industry benchmark and currentcompensation trends in the market.
d. AUDIT COMMITTEE:
The composition of Audit Committee has been detailed in the Corporate GovernanceReport.
e. VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES:
The Board of Directors of the Company has pursuant to the provisions of Section 178(9)of the Companies Act 2013 read with Rule 7 of the Companies (Meetings of Board and itsPowers) Rules 2014 framed "Whistle Blower Policy" for Directors and employeesof the Company to provide a mechanism which ensures adequate safeguards to employees andDirectors from any victimisation on raising of concerns of any violations of legal orregulatory requirements incorrect or misrepresentation of any financial statements andreports etc.
The employees of the Company have the right/option to report their concern/grievance tothe Chairman of the Audit Committee.
The Company is committed to adhere to the highest standards of ethical moral and legalconduct of business operations. The Policy is uploaded on Company's website at www.bpml.in
f. RISK MANAGEMENT FRAMEWORK:
The Board of Directors of the Company has Risk Management Framework to avoid eventssituations or circumstances which may lead to negative consequences on the Company'sbusinesses and define a structured approach to manage uncertainty and to make use ofthese in their decision making pertaining to all business divisions and corporatefunctions.
g. DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 AND OTHER DISCLOSURES ASPER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014:
The information required pursuant to Section 197 of the Companies Act 2013 read withrule 5 of the Companies (Appointment and remuneration of Managerial Personnel) Rules 2014in respect of employees of the Company will be provided upon request in terms of section196 of the Act the Report is being sent to all the shareholders of the Company and otherentitled thereto excluding the information particulars of which is available forinspection by the Members at the Corporate office of the Company during business hours onworking days of the Company upto the date of the ensuing Annual General Meeting. Membersinterested in obtaining a copy thereof may write to the Company Secretary in this regard.
h. PAYMENT OF REMUNERATION/COMMISSION TO DIRECTORS FROM HOLDING OR SUBSIDIARYCOMPANIES:
None of the managerial personnel i.e. Managing Director and Whole time Directors of theCompany are in receipt of remuneration/commission from the Holding or Subsidiary Companyof the Company.
4. AUDITORS AND REPORTS
The matters related to Auditors and their Reports are as under:
a. OBSERVATIONS OF STATUTORY AUDITORS ON ACCOUNTS FOR THE YEAR ENDED 31stMARCH 2017:
The observations made by the Statutory Auditors in their report for the financial yearended 31st March 2017 read with the explanatory notes therein are self-explanatory andtherefore do not call for any further explanation or comments from the Board underSection 134(3) of the Companies Act 2013.
Further there were no adverse remarks or qualifications of reservations in the auditreport submitted by auditors.
b. COST AUDITORS:
Pursuant to the provisions of Section 148 of the Companies Act 2013 read withNotifications/Circulars issued by the Ministry of Corporate Affairs from time to time theBoard of Directors have appointed M/s. K.G. Goyal & Associate Cost Accountants as acost auditor of the Company to fill up the causal vacancy caused by resignation of Shri.R.S. Raghavan Cost Accountants of the Company for the Financial Year 2016-17 and FinancialYear 2017-18.
The remuneration to be paid to Cost auditors require ratification by the shareholdersand accordingly necessary resolution for ratification for seeking approval of members isincluded in Notice of ensuing AGM.
c. Secretarial Auditors.
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 M/s. J.H. Fatehchandka & Co. Company Secretaries in Practice to undertakeSecretarial Audit of the Company. The Secretarial Audit Report is annexed herewith asAnnexure-III.
5. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
The particulars as required under the provisions of Section 134(3) (m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 in respect ofconservation of energy technology absorption foreign exchange earnings and outgo etc.are furnished in Annexure-IV which forms part of this Report.
6. MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant o Regulation 34(2)(e) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a Management Discussion and Analysis Report is annexed tothis Report.
All the properties/assets including buildings furnitures/ fixtures etc. and insurableinterests of the Company are adequately insured.
Your Directors take this opportunity to thank the customers shareholders suppliersbankers business partners/ associates financial institutions and Central and StateGovernments for their consistent support and encouragement to the Company.
| ||For and on behalf of the Board of Directors |
| ||Anurag P. Poddar |
| ||Chairman & Managing Director |
|Date: May 15 2017. || |
|Place: Mumbai || |
Other disclosures as per provisions of Section 134 of the Act read with Companies(Accounts) Rules 2014 are furnished as under:
A. CONSERVATION OF ENERGY:
(a) Energy Conservation measures taken by the Company;
(i) Electrical Energy:
The Company is regularly monitoring the overall consumption of energy periodicallyduring the year and losses if any are identified and suitable improvement action carriedout immediately.
(ii) Coal/Fuel Oil Consumption:
The Company is carrying out regular maintenance of steam lines/steam traps and userequipments to ensure high efficiency levels throughout the year and new improvements arereviewed regularly and implemented wherever found suitable.
(b) Additional investments and proposals if any being implemented for reduction ofConsumption of energy;
The Company is reviewing various proposals for reduction in consumption of energymainly by way of replacement of existing equipments by modern and energy efficientequipments.
(c) Impact of the measures at (a) and (b) above for reduction of energy consumption andconsequent impact on the cost of production of goods;
The various energy conservation measures detailed above adopted by the Company haveresulted in savings in energy consumption as per information given in Form " A'.
I. Total energy consumption and energy consumption per unit of production as per Form'A' hereunder:
|FORM 'A' ||Current Year ||Previous year |
|POWER AND FUEL CONSUMPTION: || || |
|1 Electricity || || |
|a Purchased || || |
|Units (KWH) ||8042350 ||2238614 |
|Total amount (Rs. in Lakhs) ||670.26 ||270.16 |
|Rate/Unit (Rs.) ||8.33 ||12.07 |
|b Own Generation || || |
|Units (KWH) ||22112940 ||23083330 |
|Total amount (' in Lakhs) ||872.53 ||940.71 |
|Rate/Unit (Rs.) ||3.95 ||4.07 |
|2 Coal (specify quality and where used) || || |
|The Company uses Steam Coal grade B/C in its Boilers || || |
|Quantity (Tons) ||43457.78 ||38394 |
|Total Amount (Rs. in Lakhs) ||2356.44 ||1955.86 |
|Average rate (Rs./Ton) ||5426 ||5094 |
|3 H.S.D/L.D.O./Furnace Oil || || |
|Quantity (K.Ltrs) ||57312 ||65341 |
|Total Amount (' in Lakhs) ||34.34 ||40.33 |
|Average rate ('/KL)(Net of Modvat Wherever applicable) ||59.92 ||61.72 |
II. Consumption per unit of production:
|Electricity (KWH) ||Coal (Kgs) ||Furnace Oil (Ltr) |
|0.505 ||729.08 ||- |
|(0.498) ||(754.05) || |
B. TECHNOLOGY ABSORPTION:
Efforts made in technology absorption as per Form 'B':
I. Research and development (R&D):
1. Specific areas in which R&D carried out by the Company:
Product and quality improvement development of new products cost control and energyconservation.
2. Benefits derived as a result of the above R&D:
The R&D activities have resulted in conserving of scarce raw materials higherproductivity and containing the costs all around.
3. Future plan of action:
Water and energy conservation and further improvement in process technology and productmix.
4. Expenditure on R&D
| ||(Rs. in Lakhs) |
|(a) Capital ||: NIL |
|(b) Recurring ||: NIL |
|(c) Total ||: NIL |
II. Technology absorption adaptation and innovation:
1. Efforts in brief made towards technology absorption adaptation and innovation:
The Company has been developing in-house modification/improvements in ProcessTechnology in its various manufacturing sections-which when found suitable areintegrated into the regular manufacturing operation.
2. Benefits - which when found suitable are integrated into the regular manufacturingoperation:
|(a) Quality improvement. ||N.A. |
|(b) Energy conservation. ||N.A. |
C. FOREIGN EXCHANGE EARNINGS & OUTGO:
(a) Activities relating to exports initiatives taken to increase exports developmentof new export markets for products and services and export plans;
The Export of Paper & Paper Board during the year amounted to Rs. 43.25 Crores.
(b) Total foreign exchange used and earned
(Rs. in Crores)
Used: Rs. 31.28 Crore
Earned: Rs. 43.25 Crores