To THE MEMBERS
Your Directors presents their Seventieth Annual Report on the business and operationsof the Company together with the audited accounts for the year ended 31st March 2016.
1. FINANCIAL RESULTS:
| ||Year ended 31st March 2016 ||Year ended 31st March 2015 |
| ||(Rs. in Lakhs) ||(Rs. in Lakhs) |
|Profit before finance cost depreciation and tax ||2159.68 ||1463.86 |
|Finance cost ||75.18 ||31.96 |
|Depreciation ||352.68 ||344.67 |
|Profit before exceptional items and tax ||1731.82 ||1087.23 |
|Exceptional items ||682.03 || |
|Profit before tax ||1049.79 ||1087.23 |
|Tax expense || || |
|Current tax ||611.00 ||470.00 |
|Deferred tax credit ||(122.50) ||(88.00) |
|Deferred tax credit relating to earlier periods ||(91.50) || |
| ||397.00 ||382.00 |
|Profit after tax ||652.79 ||705.23 |
|Balance from last year ||3044.68 ||2626.57 |
| ||3697.47 ||3331.80 |
|Appropriations: || || |
|Proposed Dividend ||197.01 ||197.01 |
|Tax on Dividend ||40.11 ||40.11 |
|Transfer to General Reserve ||50.00 ||50.00 |
|Carried forward to Balance Sheet ||3410.35 ||3044.68 |
| ||3697.47 ||3331.80 |
The Directors are pleased to recommend payment of dividend @ 15% on the Equity ShareCapital (Rs. 1.50 per share of the value of Rs. 10/- each) for the year ended 31st March2016.
(a) The Companys gross turnover for the year amounted to Rs. 262 crores ascompared to Rs. 277 crores in the previous year. The Company earned a profit (beforeexceptional items and tax) of Rs. 17.32 crores as compared to Rs. 10.87 crores in theprevious year mainly due to softening of raw material and other input costs which inturn affected the sales prices.
(b) Exceptional items of Rs. 6.82 crores represent Provision for doubtful debts andadvances relating to receivables from M/S. Bilcare Ltd. The Company has made thisprovision out of abundant precaution. Further the Company has been informed by BilcareLtd that they are undertaking restructuring of their debts and are hopeful of settlingthe dues.
4. DIRECTORS RESPONSIBILITY STATEMENT:
The Directors confirm that:
(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
(b) Appropriate accounting policies have been selected and applied consistently andjudgements and estimates made are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as on 31st March 2016 and of the Profit ofthe Company for the year ended 31st March 2016
(c) Proper and sufficient care have been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities.
(d) The annual accounts have been prepared on a going concern basis.
(e) The company has laid down internal financial controls to be followed and that suchfinancial controls are adequate and operating effectively and
(f) The company has devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
5. DIRECTORS AND KEY MANAGERIAL PERSONNEL: Re-appointment of Director liable to retireby rotation -
In terms of Section 152 of the Companies Act 2013 Mr. Suresh A. Gandhi Director isliable to retire by rotation at the ensuing Annual General Meeting and offer himself forre-appointment.
Other information pertaining to Mr. Suresh A. Gandhi is provided in CorporateGovernance Report annexed as Annexure IIA to this Report.
Independent Director(s) Declaration:
The Independent Directors have submitted the declaration of Independence as requiredpursuant to section 149(7) of the Companies Act 2013 and Listing Regulations statingthat they meet the criteria of independence as provided therein.
6. EVALUATION OF ThE BOARDS PERFORMANCE:
In compliance with the provisions of Companies Act 2013 and Regulation 17 of theListing Regulations. it is necessary to evaluate the performance of the Board and itsmembers by the independent Directors of the Company. Pursuant to Schedule IV of theCompanies Act 2013 and the Rules made thereunder a separate meeting of the IndependentDirectors was held on 19th March 2016 without the attendance of non-independent Directorsand company executives. The Independent Directors discussed matters pertaining to theCompanys affairs and functioning of the Board and presented their views.
7. CONSERVATION OF ENERGY:
Details relating to the Conservation of Energy and Technology absorption and foreignexchange earnings and outgoings as required under Section 134 of the Companies Act 2013read with the Companies (Accounts) Rules
2014 are given in Annexure I forming part of the Directors Report.
8. CORPORATE GOVERNANCE:
In terms of Listing Regulations and Companies Act 2013 a report on the CorporateGovernance along with a certificate from the Secretarial Auditor of the Company regardingcompliance of the conditions of Corporate Governance and Management Discussion andAnalysis Report are given in Annexure II and III respectively to this report.
9. CORPORATE SOCIAL RESPONSIBILITY (CSR):
The CSR committee comprises Mr. Robin Banerjee Mr. Suresh A. Gandhi and Mr. BhoumickS. Vaidya as members of the Committee. The CSR committee have formulated and recommendedto the Board a Corporate Social
Responsibility Policy (CSR Policy) indicating the list of activities to be undertakenby the Company and the same has been approved by the Board.
The Company has adopted a Municipal School in Nasik for carrying out the CSR activitiesand the same is in progress.
The Annual Report on CSR activities is given in Annexure IV to this report.
10. INTERNAL FINANCIAL CONTROL:
The Company has in place adequate internal financial controls withreferencetofinancialstatements. During the year no reportable material weakness in thedesign or operation were observed.
11. RISK MANAGEMENT:
During the year the Risk Management Committee deliberated upon the probable risk areasand took appropriate actions.
12. VIGIL MEChANISM:
Under the vigil mechanism of the Company by way of a Whistle Blower Policy protecteddisclosure can be made by a whistle blower to the Managing Director. The Whistle BlowerPolicy may be accessed on the Companys website at the link:http://www.caprihansindia.com/corporatepolicy
13. AUDITORS AND AUDITORS REPORT: STATUTORY AUDITOR:
At the Sixty-ninth Annual General Meeting (AGM) held on 28th September 2015 M/S. S RB C & Co. LLP
Chartered Accountants (ICAI Firm Reg. No 324982E/E300003) were appointed as theStatutory Auditors of the
Company to hold office for five years from the conclusion of the Sixty-ninth AGM untilthe conclusion of Seventy-fourth AGM of the Company to be held in the year 2020 subjectto ratification of the appointment by the Members at every AGM held after 69th AGM.
The observations of the Statutory Auditors in Annexure 1 to their report dated20th May 2016 (Refer Serial Nos iii and xiii) regarding related party transactions areexplained under Note No. 23 of the Financial Statement.
At the Sixty-ninth Annual General Meeting (AGM) held on 28th September 2015 M/S.Dhananjay V Joshi &
Associates Cost Accountants (Firm Reg. No 000030) were appointed as Cost Auditors ofthe Company for conducting the audit of cost records of the Company for the financialyear 2015-16
The Board had appointed M/s Rathi & Associates Company Secretaries in wholetimepractice to carry out Secretarial
Audit under the provisions of Section 204 of the Companies Act 2013 for the financialyear 2015-16.
The Report of the Secretarial Auditor pursuant to Section 204(1) of the Companies Act2013 and the rules made thereunder is given in Annexure V to this report.
The Secretarial Auditors observation in their report dated 20th May 2016 thatthe Chairman of the Audit Committee is not an independent director the Board wishes tostate that at the Meeting of Board of Directors held on 20th May 2016 Mr. Siddharth S.Shetye an independent director has been appointed as the Chairman of the Audit Committeein place of Mr. Suresh A. Gandhi a non-executive non-independent director therebycomplying with the Regulation
18(1)(d) of SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015.
(a) AUDIT COMMITTEE:
The Audit Committee comprises of Mr. Siddharth S Shetye (Chairman) Mr. Suresh AGandhi and Mr. Bhoumick S Vaidya as members. All the recommendations made by the AuditCommittee were accepted by the Board.
(b) PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
In terms of the provisions of Section 197(12) of the Companies Act 2013 (hereinreferred as Act) read with Rules 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 statement showing the names and otherparticulars of the employees drawing remuneration is excess of the limits set out in thesaid rules forms part of the Annual Report.
Disclosure pertaining to remuneration and other details as required under Section197(12) of the Act read with Rules 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 also forms part of the Annual Report.
However as per the provisions of Section 136(1) of the Act the Report and Accountsare being sent to the members excluding the aforesaid information. Any member interestedin obtaining such particulars may inspect the same at the Registered Office of theCompany.
(c) EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the annual return is given in Annexure VIto this report.
(d) NUMBER OF BOARD MEETINGS:
The Board of Directors met 7 (Seven) times in the year 2015-16. The details of theboard meetings and the attendance of the Directors are provided in the CorporateGovernance Report.
(e) RELATED PARTY TRANSACTIONS:
All the related party transactions entered by the Company during the financial yearwith related parties the ordinary course of business and on arms length basis andare in compliance with the applicable provisions of the Act and the Listing Regulations.All the related party transactions are presented to the Audit Committee for theirrecommendations to the Board.
The Related Party Transaction Policy is available on the Companys website at thelink: http://www. caprihansindia.com/corporatepolicy
The disclosure relating to the transaction with related parties are mentioned in NoteNo. 27 to the notes on financial statement.
(f) PARTICULARS OF LOAN GIVEN INVESTMENT MADE GUARANTEES GIVEN AND SECURITIESPROVIDED:
Particulars of loan given are provided in the Note No 9 to the notes on financialstatements.
15. INDUSTRIAL RELATIONS:
The industrial relations remained cordial during the year.
The Board wishes to place on record its appreciation of the services rendered by theemployees of the Company. The
Board also wishes to thank the Bankers for the co-operation and assistance extended bythem.
| ||On behalf of the Board of Directors |
| ||ROBIN BANERJEE |
| ||Managing Director |
|Place : Pune ||BHOUMICK S. VAIDYA |
|Dated : 20th May 2016 ||Director |