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Binny Mills Ltd.

BSE: 535620 Sector: Others
NSE: N.A. ISIN Code: INE160L01011
BSE LIVE 14:06 | 06 Dec 172.05 -8.95
(-4.94%)
OPEN

172.05

HIGH

172.05

LOW

172.05

NSE LIVE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 172.05
PREVIOUS CLOSE 181.00
VOLUME 354
52-Week high 288.90
52-Week low 131.00
P/E 157.84
Mkt Cap.(Rs cr) 54.88
Buy Price 172.00
Buy Qty 10.00
Sell Price 190.05
Sell Qty 45.00
OPEN 172.05
CLOSE 181.00
VOLUME 354
52-Week high 288.90
52-Week low 131.00
P/E 157.84
Mkt Cap.(Rs cr) 54.88
Buy Price 172.00
Buy Qty 10.00
Sell Price 190.05
Sell Qty 45.00

Binny Mills Ltd. (BINNYMILLS) - Director Report

Company director report

To the Members

Your Directors have pleasure in presenting the Eighth Annual Report and the AuditedAccounts of your company for the year ended 31st March 2015.

FINANCIAL RESULTS

31st March 2015 31st March 2014
Rs. Rs.
Revenue from operations & other income 71936770 70436939
Profit / (Loss) before Depreciation 9886524 1263551
Depreciation 245946 104414
Profit / (Loss) before Tax 9640578 1159137
Provision for Tax (including Deferred tax) 3283848 300009
Profit / (Loss) after Tax 6356730 859128

OPERATIONS

As the members may be aware pursuant to the Demerger Scheme of Binny Ltd the Agenciesand Services Undertaking of Binny Ltd was transferred to and vested with the Company witheffect from 1st Jan 2010 the Appointed Date as per the Demerger Scheme.

The company operates in 4 divisions viz. Warehousing Showrooms Agencies and Bintex.The Warehousing division has rented its warehouses and is deriving rental income from it.The Showrooms are engaged in retail selling of textile materials. The Agencies division isengaged in the business of selling Tarpaulin rain coats and bags. The Bintex division isengaged in selling textile materials particularly uniform materials bed spreads andother textile varieties.

For the year 2014-15 the Rental income from Warehousing division was Rs.186.15 lakhsas against Rs. 173.91 lakhs in the previous year an increase by about 7%. The sales madeby the Showrooms division was Rs.20.95 lakhs as against Rs. 25.11 lakhs in the previousyear the Agencies division did not make any sale during the year as against Rs. 2.59lakhs in the previous year and the Bintex division Rs.503.33 lakhs as against Rs. 495.89lakhs in the previous year.

The aggregate amount of revenue from Rent Sales and operating income were Rs.717.73lakhs as against Rs. 699.74 lakhs in the previous year. The Company has earned a NetProfit of Rs.63.56 lakhs as against a Net Profit of Rs. 8.59 lakhs in the previous year.

PREFERENCE SHARES

The 588000 (9.75%) Cumulative Redeemable Preference Shares (CRPS) of Rs.5/- eachaggregating to Rs.2940000/- are redeemable on or before 30th June 2016.

The 281418142 (9%) CRPS of Rs.5/- each aggregating to Rs.1407090710/- areredeemable on or before 12th May 2015. The Board of directors at their meetingheld on 29th May 2015 after obtaining the

consent of the 9% cumulative redeemable preference shareholders has extended the dateof redemption by five years to be redeemable on or before 12th May 2020.

Preference dividend is payable on the CRPS from the date of original allotment ofshares by Binny Ltd. The holders of the CRPS have preferential right to dividend over theequity share holders as and when dividend is declared by the company. The Preferencedividend in arrears for 9.75% CRPS as at 31st March 2015 is Rs.2508188/-and for 9% CRPS it is Rs.1024459710/-.

Since the Company is in the sixth year of operation after the transfer and vesting ofthe Agencies and Services Undertaking of Binny Ltd in the Company pursuant to theDemerger Scheme the company could not find enough resources to pay dividend this year.Hence the company is not recommending preference dividend this year.

DIVIDEND ON EQUITY SHARES

As stated for Preference Dividend since the Company is in the sixth year of operationafter the transfer and vesting of the Agencies and Services Undertaking of Binny Ltd inthe Company pursuant to the Demerger Scheme the company could not find enough resourcesto pay dividend this year. Hence the company is not recommending dividend on the equityshares this year.

COMPANY'S PERFORMANCE

Considering the difficult macro-economic conditions and challenging businessenvironment the Company's performance during the year under review was satisfactory.

FUTURE PLANS

The Company has plans to improve its sales performance in the Textile Division byfocusing on whole sale customers while retaining the existing retail customers. TheCompany has plans to procure bulk orders for its Textile division in order to improve thesales and profit. The Company has plans to modernize its showrooms at Bangalore andKolkata to attract new customers for its retail textile sale.

ECONOMIC AND BUSINESS ENVIRONMENT

While there are signs that economic growth is reviving the concern is that investmentsare not as forthcoming as expected. During the last year or so the Government has put inplace a comprehensive set of measures to restore investor sentiments ranging across thetax regime ease of doing business Foreign Direct Investment limits and administrativeand environmental clearances. A number of large-scale initiatives have been introduced toact as magnets for investments including Make in India the Smart City mission and CleanEnergy. Interest rates too are on the down trend with strong expectations of further ratecuts and the macroeconomic environment has turned benign despite moderation in globalgrowth and trade.

OUTLOOK AND OPPORTUNITIES

Your directors expect that with stable government in the Centre estimates of betterGDP growth rate the Company's strong business model innovative fund management andmarketing techniques continued confidence and support of the customers and suppliersyour Company should achieve better performance in the year 2015-16.

BOARD OF DIRECTORS

Directors retiring by rotation:

Shri S. Natarajan Director (DIN 00155988) retires by rotation at this Annual GeneralMeeting and being eligible offers himself for reappointment.

Re-appointment of Managing Director:

The present term of appointment of Shri V. Rajasekaran as Managing Director of theCompany is up to 12th May 2015. Board of directors at their meeting held on 29thMay 2015 reappointed Shri V. Rajasekaran as the Managing Director of the Company for afurther term of 5 years up to 12th May 2020 subject to the approval of theshareholders of the company at the 8th Annual General Meeting of the Company.

The details of their age experience and directorship in other companies as requiredunder the listing agreement is given in the Report on Corporate Governance which formspart of the Annual Report.

DISCLOSURES AS PER SECTION 134 OF THE COMPANIES ACT 2013 READ WITH RULE 8(5) OF THECOMPANIES (ACCOUNTS) RULES 2014

Extract of Annual Return:

The extract of Annual Return in the Form No. MGT 9 is annexed to the Directors' Reportas Annexure I. Number of meetings of the Board:

There were four Board meetings during the year. The details of the Board meetings andcommittee meetings are given in the Report on Corporate Governance which forms part of theAnnual Report.

Directors' Responsibility Statement:

To the best of their knowledge and belief and according to the confirmation andexplanations obtained by them your Directors make the following statement in terms ofSection 134(5) of the Companies Act 2013.

i) That in the preparation of the Annual Accounts for the year ended 31stMarch 2015 the applicable Accounting Standards had been followed along with properexplanation for material departures if any;

ii) That the selected accounting policies were applied consistently and judgements andestimates that are reasonable and prudent were made so as to give a true and fair view ofthe state of affairs of the Company as at the end of the financial year ended 31stMarch 2015 and of the profit of the Company for that period;

iii) That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 for safeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities;

iv) That the annual accounts for the year ended 31st March 2015 had been prepared on agoing concern basis.

v) Internal financial controls had been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively; and;

vi) Proper systems to ensure compliance with the provisions of all applicable laws hadbeen devised and that such systems were adequate and operating effectively.

Declaration by Independent Directors:

The Board has received the declaration from all the Independent Directors as per therequirement of section 149(7) of the Companies Act 2013 and the Board is satisfied thatall the Independent Directors meet the criterion of independence as mentioned in section149(6) of the Companies Act 2013.

Company's policy on Directors appointment and remuneration:

Pursuant to clause 49 (IV) (B) of the Listing Agreement the Nomination andRemuneration Committee has put in place the policy on board diversity for appointment ofdirectors taking into consideration the qualification and wide experience of the directorsin the fields of textiles trading banking finance administration and legal apart fromcompliance of legal requirements of the Company. The policy on Board diversity is annexedto the Directors' Report as Annexure II and is also uploaded on the Company'swebsite www.bmlindia.com

The Nomination and Remuneration Committee has laid down remuneration criteria for thedirectors key managerial personnel and other employees in the Nomination and RemunerationPolicy. It has also laid down in the Nomination and Remuneration Policy the evaluationcriteria for performance evaluation of the directors including independent directors. TheNomination and Remuneration Policy is annexed to the Directors' Report as Annexure III andis also uploaded on the Company's website www.bmlindia.com.

Explanations or comments by the Board on every qualification reservation or adverseremark or disclaimer made in the Auditors' Report and in the Secretarial Audit Report:

The Auditors' Report to the Shareholders for the year under review does not contain anyqualification reservation or adverse remark or disclaimer. The Secretarial Audit Reportgiven by a Company Secretary in practice does not contain any qualification observationreservation or adverse remark or disclaimer.

Particulars of loans guarantees or investments under section 186 of the Companies Act2013:

There are no loans made guarantees given or security provided or securities of anyother body corporate acquired during the year under section 186 of the Companies Act2013.

Particulars of contracts or arrangements with related parties:

The Related Party Transactions (RPT's) entered into by the Company are given in NoteNo.32 of the Notes on Accounts attached to the Financial Statements. These transactionswere entered into in the ordinary course of business and on an arm's length basis and werein compliance with the provisions of the Companies Act 2013 and the Listing Agreement.There are no contracts or arrangements with Related Parties referred to in section 188 (1)of the Companies Act 2013. There are no materially significant related party transactionsmade by the Company with the Promoters Directors Key Managerial Personnel or otherdesignated persons which may have a potential conflict with the interest of the Company atlarge.

The statement of RPT's is placed before the Audit Committee and the Board on aquarterly basis. Omnibus approval was obtained for the transactions of repetitive nature.

The Policy on Materiality of Related Party Transactions and dealing with Related PartyTransactions as approved by the Board is uploaded on the Company's websitewww.bmlindia.com

None of the directors have any pecuniary relationships or transactions with the Companyexcept for the payment of sitting fees. There are no particulars of RPT's to be disclosedin Form AOC-2.

The state of the Company's affairs:

The state of the Company's affairs is explained in the paragraph 'operations' in theDirectors' Report.

The amount if any carried to reserves:

The Company has not transferred any amount to reserves.

The amount if any which it recommends should be paid by way of dividend:

The Board is not recommending payment of any dividend on the Preference shares and theequity shares issued by the Company.

Material changes and commitments if any affecting the financial position of theCompany which have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of report:

There are no material changes and commitments affecting the financial position of theCompany that have occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of report viz. for the period from 31stMarch 2015 to 31st July 2015.

Conservation of energy technology absorption foreign exchange earnings and outgo:

The information pursuant to section 134(3) (m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 is as follows:

a. The Company has no activity involving conservation of energy or technologyabsorption.

b. The Company does not have any foreign exchange earnings and outgo.

Risk Management Policy:

Pursuant to Clause 49 (VI) (C) of the Listing Agreement as amended the Company hasre-constituted the Risk Management Committee. The details of the Committee and its term ofreference are set out in the Report on Corporate Governance. The Company has framed a RiskManagement Policy to identify communicate and manage material risks across theorganisation. The policy also ensures that responsibilities have been appropriatelydelegated for risk management. Key Risk and mitigation measures are provided in theManagement Discussion and Analysis Report annexed to the Directors' Report.

The details about the policy developed and implemented by the Company on CorporateSocial Responsibility initiatives taken during the year:

The provisions of section 135 of the Companies Act 2013 are not applicable to theCompany. Hence the Company has no Corporate Social Responsibility Policy. Howeverpursuant to good corporate governance practice your company demands adherence of socialresponsibility coupled with creation of value in the larger interest of the society. Yourcompany and its dedicated employees continue to contribute towards several worthwhilecauses. Your company aims to enhance the quality of life of the community in general andhas a strong sense of social responsibility. Your Company and its employees haveparticipated in welfare activities of the community.

Statement indicating the manner in which formal annual evaluation has been made by theBoard of its own performance and that of its committees and individual directors:

Pursuant to the provisions of the Companies Act 2013 and clause 49 of the ListingAgreement the Board has carried out an annual performance evaluation of its ownperformance the directors individually as well as the evaluation of the working of itsvarious Committees in the manner laid down in the Nomination and Renumeration Policy ofthe Company.

The financial summary or highlights:

The financial summary is given in the Paragraph 'Financial Results' in the Directors'Report.

The change in the nature of business if any:

There is no change in the nature of business.

The details of directors or key managerial personnel who were appointed or haveresigned during the year:

Shri P Laxmidhar Prusty Company Secretary has resigned during the year.

The names of companies which have become or ceased to be Subsidiaries joint venturesor associate companies during the year:

There are no companies which have become or ceased to be Subsidiaries joint venturesor associate companies during the year.

The details relating to deposits covered under Chapter V of the Companies Act 2013and details of deposits which are not in compliance with the requirements of Chapter V ofthe Companies Act 2013:

The company has not accepted any deposits covered under Chapter V of the Companies Act2013.

The details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future:

There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.

The details in respect of adequacy of internal financial controls with reference to theFinancial Statements:

The Company's well defined organizational structure documented policy guidelinesdefined authority matrix and internal financial controls ensure efficiency of operationsprotection of resources and compliance with the applicable laws and regulations. Moreoverthe Company continuously upgrades its systems and undertakes review of policies. Theinternal financial control is supplemented by regular reviews by management and standardpolicies and guidelines to ensure reliability of financial data and all other records toprepare the financial statements and other data. The Audit Committee reviews the internalfinancial controls and also monitors the implemented suggestions.

DISCLOSURES BY A LISTED COMPANY UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014

The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year:

Since no director of the Company is in receipt of remuneration from the Company thereare no particulars to be furnished.

The percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:

There is no increase in the remuneration to the aforesaid personnel in the financialyear 2014-15.

The percentage increase in the median remuneration of employees in the financial year:

There is no increase in the median remuneration of employees in the financial year2014-15.

The number of permanent employees on the rolls of the Company:

There are 17 permanent employees on the rolls of the Company as at 31stMarch 2015.

The explanation on the relationship between average increase in remuneration andcompany performance:

The increase in revenue from operations in the financial year 2014-15 is 2.57% whereasthere is no increase in remuneration during the year.

Comparison of the remuneration of the Key Managerial Personnel against the performanceof the Company:

The revenue from operations of the company during the year is Rs.717.73 lakhs asagainst the remuneration of the Key Managerial Personnel of Rs.1.69 lakhs.

Variations in the market capitalisation of the Company:

a) The market capitalisation of the Company has decreased by 35.59% as on 31stMarch 2015 to Rs.108.53 crores from Rs.168.50 crores as at 31st March 2014.

b) Price Earnings Ratio of the Company was 171.05 as at 31st March 2015 andwas 1957.22 as at 31st March 2014.

c) Percent increase over / decrease in the market quotations of the shares of theCompany as compared to the rate at which the Company came out with the last public offerin the year:

The Company has not made any public offer of equity shares. Pursuant to the DemergerScheme of Binny Ltd Binny Mills Ltd as a resulting company issued and allotted to theshareholders of Binny Ltd - the demerged company one equity share of Rs.10/- each inBinny Mills Ltd credited as fully paid-up for every 7 equity shares of Rs.5/- eachfully paid up held in Binny Ltd. (share entitlement ratio specified in the demergerscheme). Accordingly 28th May 2010 was fixed as the record date. On 2ndJune 2010 as per the share entitlement ratio the company issued and allotted 3188474equity shares of Rs.10/- each in Binny Mills Ltd credited as fully paid up aggregatingto Rs.31884740/- to the shareholders of Binny Ltd. With effect from 28th May2013 the aforesaid equity shares of Binny Mills Ltd (Scrip Code: 535620) were listed andadmitted to dealings on the Bombay Stock Exchange in the list of 'T' Group Securities.

An amount of Rs.10/- per share invested in the company as per the aforesaid demergerscheme has traded at the Bombay Stock Exchange at a market price of Rs.340.40 per shareas on 31st March 2015.

Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year viz. 2014-15 and its comparison with thepercentile increase in the managerial remuneration:

There is no managerial remuneration paid during the financial year 2014-15. There wasno increase in the salaries of employees during the financial year 2014-15.

The key parameters for any variable component of remuneration availed by the directors:

The directors were not paid any remuneration during the financial year 2014-15.

The ratio of the remuneration of the highest paid director to that of the employees whoare not directors but receive remuneration in excess of the highest paid director duringthe year:

The directors were not paid any remuneration during the financial year 2014-15.

It is hereby affirmed that the remuneration is as per the remuneration policy of theCompany.

STATEMENT OF EMPLOYEES' PARTICULARS

The particulars required to be furnished under Rule 5(2) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 is as follows:

During the year there are no employees drawing remuneration of Rs.60 lakhs or more perannum or Rs.5 lakhs or more per month or was in receipt of remuneration which neither inthe aggregate nor at a rate which in the aggregate is in excess of that drawn by theManaging Director or holding either by himself or along with his spouse and dependentchildren not less than 2% of the equity shares of the Company.

AUDITORS

M/s T Selvaraj & Co. Chartered Accountants Chennai (Firm Registration No. :003703S) the Statutory Auditors of the company retire at the conclusion of the ensuingAnnual General Meeting and are eligible for re-appointment for the year 2015-2016.Certificate has been received from them to the effect that their re-appointment asstatutory auditors of the Company if made would be within the limits prescribed underSections 139 & 141 of the Companies Act 2013. They have also confirmed that they holda valid peer review certificate as prescribed under clause 41(1) (h) of the ListingAgreement. The Directors recommend their reappointment. If reappointed they will holdoffice until the conclusion of the next Annual General Meeting of the company.

SECRETARIAL AUDIT

The Board had appointed Shri K. Elangovan M/s Elangovan Associates CompanySecretaries in Practice Chennai (Certificate of Practice No.3552) Membership No. (FCS1808) to carry out Secretarial Audit under the provisions of section 204 of the CompaniesAct 2013 for the financial year 2014-15. The Secretarial Audit Report is annexed to thisreport as Annexure IV.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

Pursuant to clause 49 (II) (F) of the Listing Agreement the Company has framed aWhistle Blower Policy / Vigil Mechanism providing a mechanism under which an employee /director of the Company may report violation of personnel policies of the Companyunethical behavior suspected or actual fraud violation of Company's code of conduct orethics policy.

The Vigil Mechanism provides for adequate safeguards against victimization of directors/ employees who avail of the mechanism and also provide for direct access to the Chairmanof the Audit Committee in exceptional cases. It also ensures standards of professionalismhonesty integrity and ethical behavior. The Whistle Blower Policy / Vigil Mechanism isuploaded on the Company's website www.bmlindia.com

ATTACHMENTS

The Management Discussion and Analysis Report

The Management Discussion and Analysis Report pursuant to clause 49 (VIII) (D) (1) ofthe listing agreement is given as a separate Report and this report is part of theDirectors' Report.

The Report on Corporate Governance

The Report on Corporate Governance pursuant to clause 49 (X) (A) of the ListingAgreement together with Auditors' Certificate on Corporate Governance the certificateduly signed by the Managing Director on the Financial Statements of the Company for theyear ended 31st March 2015 as submitted to the Board of Directors at theirmeeting held on 29th May 2015 and the declaration by the Managing Directorregarding compliance by the Board members and senior management personnel with theCompany's Code of Conduct is included as a separate section in the Annual Report.

ACKNOWLEDGEMENT

Your Directors place on record their appreciation for the continued co-operation andsupport extended by all concerned persons and authorities for the smooth and efficientfunctioning of the Company.

For and on behalf of the Board
V.R. Venkataachalam
Chairman
Registered Office:
No.4 (Old No.10) Karpagambal Nagar
Mylapore
Chennai 600 004.
Date: 31st July 2015

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