Your Directors have pleasure in presenting the 27th Annual Report of the Companytogether with the audited statements of account for the financial year ended March312017.
| || || |
(Rs. in lakhs)
|1. FINANCIAL RESULTS : ||2016-17 ||2015-16 |
|Profit before interest depreciation and tax ||2165.44 ||2296.49 |
|Less: Financial expenses ||1089.97 ||1222.01 |
|Less: Depreciation ||462.90 ||459.62 |
|Profit before tax ||612.57 ||614.86 |
|Tax expense (net) ||(61.66) ||(56.90) |
|Profit after tax ||550.91 ||557.96 |
|Balance in profit & loss account ||6970.11 ||6501.69 |
|Amount available for appropriation ||7521.02 ||7059.65 |
|Less: Appropriations || || |
|Transferred to general reserves ||35.00 ||35.00 |
|Proposed dividend ||45.31 ||45.31 |
|Tax on dividend ||9.22 ||9.22 |
|Surplus carried to balance sheet ||7431.49 ||6970.11 |
2. CORPORATE OVERVIEW AND THE STATE OF COMPANY'S AFFAIRS :
The financial year 2016-17 has been a year marked with both excitement and challengesfor the global as well as Indian economy. The performance of the Agro industries continuedto be sluggish in the early part of the year on the back of two consecutive poor monsoons.The overall market showed signs of recovery in the latter half of the year but faced atemporary slowdown in November due to demonetization.
In this challenging business environment due to cost cutting measures adopted by theCompany the Company could maintain the EBIDTA at the same level of the previous year eventhough the turnover of the company reduced from Rs. 306.06 Crores (Previous Year) to Rs.295.27 Crores. The seed division continued its steady growth during the current year andits turnover had reached a new high of ' 138.35 Crores and managed to contribute 46.86% ofthe total turnover of the Company.
There has not been any material changes and commitments affecting the financialposition of the company which have occurred between the end of the financial year of thecompany to which Financial Statements relate and the date of this report. There have notbeen any changes in the Nature of Business of the Company during the year.
There have not been any changes in the Share capital of the Company during the year.
3. TRANSFER TO RESERVES :
The Board had out of the total profit of Rs. 550.91 lakhs for the current financialyear proposed to transfer Rs. 35 Lakhs (Previous Year Rs. 35 lakhs) to the GeneralReserve.
4. DIVIDEND :
The Board of Directors are pleased to recommend the dividend of Rs. 0.05 per share (5%)for the year 2016-17 on equity share capital subject to the approval of the shareholdersat the Annual General Meeting (Previous Year 5%) which shall absorb Rs. 45.31 lakhs(Previous Year Rs. 45.31 lakhs).
5. CAPITAL EXPENDITURE INCURRED :
The Company had incurred Rs. 271.30 lakhs as the capital expenditure during the yearunder review (Previous Year Rs. 977.61 lakhs).
6. DIRECTORS/ KEY MANAGERIAL PERSONNEL (KMP) DETAILS :
Shri. D.C. Bhartia (DIN: 00151521) director retires by rotation at this Annual GeneralMeeting and being eligible offered himself for reappointment. The Board of Directors ofthe Company recommended his reappointment. The brief resume of Shri. D. C. Bhartia hasbeen provided in the Corporate Governance Report forming part of this annual report. Therehave not been any changes in the Director and KMP during the year.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under the provisionsof the Companies Act 2013 read with the Schedules and rules issued thereunder as well asRegulation 16(1)(b) of Listing Regulations (including any statutory modification(s) orre-enactment(s) for the time being in force).
7. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS :
There are no significant and material orders passed by regulators/ courts that wouldimpact the going concern status of the Company and its future operations.
8. SHARE CAPITAL :
There have not been any changes in the share capital of the Company during the year.
9. STATUTORY AUDITORS :
The Board of Directors on the recommendation of the Audit Committee has proposed toratifies the appointment of M/s Amar Bafna & Associates Chartered Accountants Mumbaiand M/s Gautam R. Agrawal & Associates Chartered Accountants Akola as JointStatutory Auditors of the Company from conclusion of this Annual General Meeting till theconclusion of the 28th Annual General Meeting of the Company. They have furnished theconfirmation regarding their eligibility to the effect that their appointment if madewould be within the prescribed limit under the Act and they are not disqualified forappointment.
Shri. T.M. Rathi the Cost Accountants carried out the cost audit for applicablebusiness during the year. The Board of Directors has re-appointed Shri. T.M. Rathi CostAccountant as Cost Auditors for the financial year 2017-18.
10. INTERNAL FINANCIAL CONTROLS :
The company has adequate internal financial control system commensurate with the sizeand scale of its operations and the same has been operating effectively. Statutory andinternal Auditors evaluate the efficiency and adequacy of internal control systemaccounting procedures and policies adopted by the Company for efficient conduct of itsbusiness adherence to Company's policies safeguarding of Company's assets preventionand detention of frauds and errors and timely preparation of reliable financialinformation etc and internal financial control system is being upgraded as per theirrecommendation
11. COMPANY'S POLICY ON SELECTION OF DIRECTORS AND DETERMINING DIRECTORS' INDEPENDENCEAND REMUNERATION :
The Company has a Nomination and Remuneration Committee (NRC) and the Composition ofCommittee and the Scope of the Committee are set out in the Corporate Governance Reportforming part of this Annual Report.
The Company's Policy for selection and appointment of Directors and their remunerationis based on its NRC policy which inter alia deals with the manner of selection of theBoard of Directors and such other matters as provided under section 178(3) of the Act andSEBI Listing Regulations.
The shareholders may refer the Company's website for the detailed Nomination &Remuneration Policy of the Company on the appointment and remuneration of Directorsincluding criteria for determining qualifications independence of Director and othermatters provided under sub-section (3) of section 178.
12. AUDITORS' REPORT :
The Statutory Auditors of the Company have not reported any fraud as specified underthe second proviso of Section 143(12) of the Companies Act 2013 (including any statutorymodification(s) or re-enactment(s) for the time being in force.
The Auditors' Report for the financial year ended 31st March 2017 does not containany qualification reservation or adverse remark.
13. SECRETARIAL AUDIT :
M/s. Martinho Ferrao & Associates Practicing Company Secretary carried outSecretarial Audit for the Financial Year 2016-17 and their report is annexed herewith as Annexure- C to this report. The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
In terms of Section 204 of the Companies Act 2013 the Board of Directors of theCompany has appointed M/s.Ferrao MSR & Associates Practicing Company Secretary asSecretarial Auditors to conduct the secretarial audit for the financial year 2017-18.
14. EXTRACT OF ANNUAL RETURN :
Extract of Annual Return of the Company in form MGT-9 is annexed herewith as AnnexureD' to this report.
15. PUBLIC DEPOSIT :
During the year the Company has not accepted any deposit within the meaning of Section73 and 74 of Companies Act 2013 read with the Companies (Acceptance of Deposit) Rules2014 (including any statutory modification (s) or reenactment(s) for the time being inforce).
16. CORPORATE SOCIAL RESPONSIBILITY (CSR) :
The CSR expenditure incurred by the company during the financial year 2016-17 was Rs.20.20 lakhs (Previous Year 25.80 lakhs) which was higher than the statutory requirement of2% of the average profit for the last three years. In accordance to provision of Section135 of the Company Act 2013 and Companies (Corporate Social Responsibility Policy) Rules2014 the details of the CSR expenditure is annexed to this report as Annexure- A.
The CSR policy of the company mainly focuses on the welfare & sustainable growthand development of the weaker section of the Society which is in line with the company'sage old policy of providing necessary financial support for the upliftment of the poorpeople as well as welfare of the physically handicapped and deaf and blind citizens. The
CSR policy of the Company has emphasis on undertaking the various activities in ruralarea like Rural development Promoting education Providing healthcare and Building thecommunity centers the details of which are available on the Company's website.
17. DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to section 134 of the Companies Act 2013 with respect Directors'Responsibility Statement it is hereby confirmed that:
i. in the preparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards had been followed and there is no materialdepartures from the same;
ii. the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year i:e31st March 2017 and of the profit and loss of the company for that period;
iii. the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities
iv. the directors have prepared the annual accounts on a going concern basis;
v. the directors have implemented internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
vi. the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
18. MEETING OF BOARD :
Eleven meetings of the Board of Directors were held during the year under review. Forfurther details please refer report on Corporate Governance published in this AnnualReport.
19. RELATED PARTY TRANSACTIONS :
The Company has formulated a Policy on Related Party Transaction (RPT) which isavailable on Company's website. All contracts / transactions as specified in Section 188of the Act entered by the Company with related parties during the financial year were inthe ordinary course of business and on an arm's length basis with necessary prior approvalof members & audit committee. The Note No. 32 to Financial Statements sets out relatedparty disclosures.
Since all related party transactions entered into by the Company were in the ordinarycourse of business and were on arms' length basis Form AOC-2 is not applicable to theCompany.
20. CORPORATE GOVERNANCE :
Pursuant to clause 34 of the listing agreement with the BSE Ltd a separate sectiontitled "Report on Corporate Governance" is being published as a part of thisAnnual Report alongwith the certificate of the auditors confirming the compliance ofconditions of the corporate governance.
Various disclosure as required under section 134 and 135 of the Companies Act 2013 areannexed to this report or covered in the Corporate Governance Report such as relatedparty transaction extract of Annual return constitution of various Board levelcommittees CSR policy and initiative taken during the year remuneration of themanagerial personnel secretarial audit report etc.
21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT :
The Management Discussion and Analysis forms an integral part of this report has beenseparately furnished in Annual Report. The Management Discussion and Analysis givesdetails of organization overall industrial economic overview current and future outlookstrength and weakness cautionary statement.
22 RISK MANAGEMENT POLICY :
The Company has got the risk management policy which is in line with applicable lawsand which aims at identifying assessing and mitigating the various risks which areinherent in the business of the Company. The risk management policy helps in enhancing thebusiness values of the Company with code of conduct adequate quality checks and internalcontrols. The risk management policy has been developed and implemented by operative teamsat various levels of management.
23. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIESPROVIDED :
During the year company has not made any investment given loans and providesguarantees in pursuant to provision of section 186 of the Companies Act 2013 read withthe Companies (Meetings of Board and its Powers) Rules 2014.
24. PARTICULARS OF EMPLOYEES UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 :
There were no employees whose remuneration was in excess of the limits prescribed underSection 197 (12) of the Companies Act 2013 read with Rules 5 (2) of Companies(Appointment and remuneration of Managerial personnel) Rules 2014.
The ratio of remuneration of each director to the median employee's remuneration andother details in accordance with sub-section 12 of the Section 197 of the Act read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 form part of this report as Annexure - E.
25. PARTICULARS OF ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO :
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe Companies (Account) Rules 2014 is set out herewith as Annexure - B.
26. ACKNOWLEDGEMENTS :
Your Directors would like to express their appreciation for the support andco-operation received from financial institutions company's bankers governmentauthorities and shareholders during the year under review. The Company wishes to place onrecord their sincere appreciation to all employees for their commitment and continuedcontribution to the Company.
| ||For and on behalf of the Board |
| ||Shashikant C.Bhartia |
|Place : Mumbai ||Chairman & managing director |
|Date : 29th May 2017 ||DIN : 00151358 |
Annual report on corporate social responsibility (CSR) activities
|1. A brief outline of the Company's CSR policy : including overview of projects or programmes proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programs ||CSR Policy of the company is available on Weblink: http://www. basantagro.com/company/ Financial & filings/policies/CSR policy |
|2. Composition of the CSR Committee : ||Mrs M.M.Khandelwal - (Chairman) / Independent Director |
| ||Shri. S.W Sawant - Independent Director |
| ||Dr. B. G. Bathkal - Independent Director |
| ||Shri. R.S. Tayade - Independent Director |
|3. Average net profit of the Company for last : three financial years ||' 1005.20 lakhs |
|4. Prescribed CSR Expenditure (2% of the : amount as in item 3 above) ||The Company is required to spend Rs. 20.10 lakhs towards CSR activities. |
|5. Details of CSR spend for the financial year : || |
|a. Total amount spent for the financial year : ||Rs. 20.20 lakhs |
|b. Amount unspent if any : ||Nil |
|c. Manner in which the amount spent during the financial year is detailed below : ||CSR Activities undertaken by Company ||Amount (Rs. in lakhs) |
| ||- Eradication hunger and poverty & malnutrition (Providing free tea and lunch at Hospitals at Akola) ||11.19 |
| ||- Promoting preventing health care & Sanitation ||9.01 |
| ||Total CSR expenditures ||20.20 |
| ||For and on behalf of the Board |
| ||Shashikant C.Bhartia |
|Place : Mumbai ||Chairman & managing director |
|Date : 29th May 2017 ||DIN : 00151358 |
Particulars required under Rule 8 of Companies (Account) Rules 2014.
A. CONSERVATION OF ENERGY :
The manufacturing units have continued their efforts to reduce the specific energyconsumption. Specific energy consumption and absolute units consumption are tracked on adaily basis at individual factory/ block level and also at consolidated manufacturinglevel. Energy conservation initiatives are being planned and implemented acrossmanufacturing locations. Some of the key measures taken in all the plants are as follow:-
1. All manufacturing units continued their efforts to reduce the specific energyconsumption.
2. All the manufacturing units increase the awareness level amongst the workforce forvarious energy conservation measures at the plant level thereby conducting its operationmore efficiently.
3. Specific and total energy consumption is tracked on a daily basis at individualfactory/ block level and also at consolidated manufacturing level.
4. Energy conservation initiatives are being planned and implemented acrossmanufacturing locations.
5. Energy audits are conducted at all the manufacturing units at regular intervals andefforts were made to ensure optimum consumption of fuel and electricity.
6. Apart from regular practices and measures for energy conservation many newinitiatives were driven across the units.
FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY
| ||2016-17 ||2015-16 |
|A. POWER & FUEL CONSUMPTION || || |
|1. Electricity || || |
|a) Purchased from electricity Board (No. of units) ||3879413 ||3879861 |
|Total amount (Rs. in lakhs) ||301.84 ||315.89 |
|Rate/ Unit (Rs.) ||7.78 ||8.32 |
|b) Own generation ||Nil ||Nil |
|2. Fuel- Briquettes (Kgs) ||2937503 ||3183649 |
|Total amount (Rs. in lakhs) (for fertilizers units) ||150.25 ||162.16 |
|Average rate per Kg. (Rs.) ||5.11 ||5.09 |
|B. CONSUMPTION PER UNIT OF PRODUCTION (MT) || || |
|NPK granulated mixture fertilizers || || |
|Electricity (No. of units) ||10.52 ||9.90 |
|Briquettes (in Kgs) ||24.16 ||24.14 |
|SSP fertilizers || || |
|Electricity (No. of units) ||18.73 ||18.80 |
|G.S.S.P. fertilizers || || |
|Electricity (No. of units) ||13.16 ||13.50 |
|Briquettes (in Kgs) ||24.08 ||24.08 |
A. ABSORPTION OF TECHNOLOGY : Not Applicable
B. RESEARCH AND DEVELOPMENT (R & D) :
i. Specific areas in which R & D carried out by the Company:
The R & D activities of the fertilizer division are mainly concentrating at havingoptimum plant operation and thereby reduced the cost of production along with qualityimprovement. The R & D department of seed division mainly concentrates on developmentof new high yielding varieties of seeds. The R & D department with the help ofBio-Technology and other advanced scientific techniques enhance the speed and precision ofplant breeding.
ii. Benefits derived as a result of above R & D:
The benefits derived of the R & D activities are best quality production offertilizer improvement in production performance effluent treatment environmentprotection better working conditions and worker safety. The R & D activities in seeddivision develop the hybrid seeds with better yield considering thescientific-technological advances location adaptability soil and climatic conditions ingeneral.
iii. Future plans of action:
The company will continues its focus on development in R & D activities of thecompany and thereby improve in he cost effectiveness in the production of fertilizers andseeds. R & D activities focus on developing high yielding hybrid varieties of seeds.
iv. Revenue expenditure on R & D :
Rs. 52.83 lakhs (Previous year Rs. 60.17 lakhs).
C. FOREIGN EXCHANGE EARNINGS AND OUTGO :
| || || |
( Rs. in lakhs)
| ||2016-17 ||2015-16 |
|Total foreign exchange outgo : (Raw materials) ||3084.88 ||2874.33 |
|Total foreign exchange earned ||NIL ||NIL |