The Directors have pleasure in presenting the 34th Annual Report togetherwith the Audited Statement of Accounts of the Company for the year ended 31stMarch 2016.
1. FINANCIAL RESULTS
The financial results for the year ended 31st March 2016 are briefly givenbelow:-
|Particulars ||2015-2016 (Rs) ||2014-2015 (Rs) |
|Sales & Other Income ||421136650 ||398398286 |
|Profit before Depreciation & Interest ||33875811 ||36182938 |
|Less: - Depreciation ||11693000 ||8500000 |
|Interest/Finance cost ||14505016 ||10426662 |
|Profit before exceptional Item ||7677795 ||17256276 |
|Add; Exceptional Items || ||16368339 |
|Add: Extra Ordinary Item of Income || ||13031787 |
|Profit before Tax ||7677795 ||46656402 |
|Less: Provision for Taxation ||2500000 ||13750000 |
|Profit after Taxation for the Year ||5177795 ||32906402 |
2. COMPANY'S AFFAIRS AND PERFORMANCE
During the year under review the Revenue from Operations of the Company was ' 4131.71Lacs as against ' 3960.20 Lacs of the previous year. The export turnover of the Companyduring the year under report was ' Nil as against '1.92 Lacs of the previous year. TheCompany has earned the Profit before Tax before Exceptional & Extra Ordinary Items of'76.78 Lacs as against the Profit of ' 172.56 Lacs of the previous year.
3. TRANSFER TO RESERVES
Your Company has not proposed to transfer any amount to the General Reserve. An amountof ' 5177795/ - is proposed to be retained in the Statement of Profit and Loss Account.
Considering the present sluggish business environment slow down in the economy andwith a view to augment the long term resources and to plough back the earnings in thebusiness itself your Directors do not recommend any Dividend on the Shares of theCompany.
5. MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Indian Food Processing Industry is showing remarkable Growth. The packaged Foodprocessing Sector is one of the largest Sectors in India. However having accepted thesefacts your Company could not achieve better performance mainly because of the peculiarproduct range the Company is having. The main revenue generation of the Company atpresent is out of the Food Items like Pickles and Ketchups which are traditional. TheseFood Products have its own limitations to contribute to the growth success.
Market Scenario and Challenges
Due to the changing environment erratic atmosphere and weather conditions theagricultural sector has seen a setback over past couple of years. The procurement ofquality raw material at a right time and right price has become a difficult task. Thevolatile input cost environment and sensitive competitive intensity the operativeenvironment for the Company during the Year continued to be challenging. The performanceof the Company if viewed in this context is reasonable.
As a result the Company manufacturing Pickles and Ketchups is facing low growthorientation.
'Competition' in Food Industry is very strong and tough as it covers InternationalPlayers as well as Players from Organized and Unorganized Sector. It is difficult tobalance the marketing and pricing strategies because of the product range and volumes theInternational Players are dumping in the market and the low prices that are offered by theUnorganized Sector.
The ever increasing prices and scarcity of quality Raw Material also matters thefinancial performance of the Company as the Prices of the Products marketed by theCompany are market driven and there is hardly any chance to fix the Prices on its own.
The Company has established a wide range of Distribution network in MaharashtraKarnataka and Goa which approaches to the numerous grocery stores. However the Customersnow adopting new means of purchasing like E - Commerce Platform Online purchasing Mallsetc. the Company is finding it difficult to boost the demand for its Products in theMarket by the present marketing strategies. The Company is focusing to tap new Productsnew Markets and new means of marketing to meet the changing trends and preferences of theCustomers.
Sustainability and Growth:
To match with the fast growing technical developments the Company is also upgradingitself with new developed manufacturing techniques and is upgrading its manufacturingprocesses and production infrastructure. In the processed Food Industry 'Packaging' isalso a vital part. The Company is giving utmost thrust and importance to the packagingwhereby the shelf life of the products is improved as well it attracts the attention ofthe Customers.
During the Year the Company took the major steps for approaching the end Customers bydirect Advertisements through advertising in retail stores outdoor campaigns and moreappealing packaging.
The Company is also developing new Processed and Ready to eat Food items and is givingemphasis on the market driven fast moving Food Products to add to its present range ofProducts.
The Company gives utmost care on Waste Management as lot of Bio based Waste isgenerated during the course of production. The Company is taking each and every step to beenvironmental friendly in its manufacturing processes and in compliance with the stricternorms introduced by the Food Safety Authority.
6. CAUTIONARY STATEMENT
Statements in this Report particularly those which relate to Management Discussion andAnalysis describing the Company's objectives projections estimates and expectations mayconstitute "forward looking statements" within the meaning of applicable lawsand regulations. Actual Results might differ materially from those either expressed orimplied.
In accordance with provisions of Section 152 of Companies Act 2013 and in terms ofArticles of Association of the Company Mr. Hukmichand S. Chordia [DIN: 00389587] retiresby rotation at forthcoming Annual General Meeting and being eligible offers himself forre-appointment.
8. PUBLIC DEPOSITS
During the Financial Year 2015-2016 your Company has not accepted any deposit withinthe meaning of Sections 73 and 74 of the Companies Act 2013 read together with theCompanies (Acceptance of Deposits) Rules 2014.
9. INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems to ensure operational efficiencyaccuracy and promptness in financial reporting and compliance of various laws andregulations.
The internal control system is supported by the internal audit process. An InternalAuditor has been appointed for this purpose.
The Audit Committee of the Board reviews the Internal Audit Report and the adequacy andeffectiveness of internal controls periodically.
10. LISTING FEES
The annual listing fee for the year 2015-2016 as well as for the year 2016-2017 havebeen paid to BSE Limited where your Company's shares are listed.
11. HOLDING COMPANIES SUBSIDIARY COMPANIES AND ASSOCIATE COMPANIES
Company does not have any Holding Company Subsidiary Company and Associate Company.
12. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT - 9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 are set out herewith as Annexure I to thisReport.
13. NUMBER OF MEETINGS OF THE BOARD
During the year Eleven (11) Board Meetings were convened and held including oneseparate Meeting of Independent Directors on 31st March 2016. The details ofthe said Meetings held are given in the Corporate Governance Report. The intervening gapbetween the Meetings was within the period prescribed under Companies Act 2013 andRegulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
14. DIRECTOR'S RESPONSIBILITY STATEMENT
Directors' Responsibility Statement prepared pursuant to the provisions of Section134(5) of the Companies Act 2013 is furnished below as required under Section 134(3)(c).
Directors state that:-
a) In the preparation of the Annual Financial Statements for the year ended 31stMarch 2016 the applicable Accounting Standards have been followed along with the properexplanation relating to material departures;
b) Accounting Policies as mentioned in Part-B to the Financial Statements have beenselected and applied consistently. Further judgments and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at 31st March 2016 and of the Profit of the Company for the yearended on that date;
c) Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The Annual Financial Statements have been prepared on a going concern basis;
e) Proper internal financial controls were in place and that the financial controlswere adequate and were operating effectively; and
f) Proper systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.
15. DECLARATION BY INDEPENDENT DIRECTOR
All Independent Directors have given declarations under Section 149(7) of the CompaniesAct 2013 that they meet the criteria of independence as laid down under Section 149(6)of the Companies Act 2013 and Regulation 16(1 )(b) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
16. AUDITORS AND AUDITORS' REPORT
a) Internal Auditor
The Internal Auditor M/s. Shashank Amin Chartered Accountants Pune have conductedinternal audits periodically and submitted their reports to the Audit Committee. TheirReports have been reviewed by the Statutory Auditors and the Audit Committee.
b) Statutory Auditor:
At the Company's 33rd Annual General Meeting (AGM) held on 26thSeptember 2015 M/s Sunil Shah Chartered Accountants were appointed as the Company'sStatutory Auditor's from the conclusion of the 33rd AGM till the conclusion ofthe 35th AGM to be held in the Year 2017.
In terms of Section 139(1) of the Companies Act 2013 the necessary Resolution forratification of their appointment as the Statutory Auditors to hold office from conclusionof the forthcoming Annual General Meeting till the conclusion of the next Annual GeneralMeeting is placed for your approval.
The Auditors Report to the Shareholders for the year under review does not contain anyqualification.
No frauds have been reported by the Auditors under Section 143(12) of the CompaniesAct 2013 requiring disclosure in Board's Report.
c) Secretarial Audit:
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 your Companyhas appointed M/s. Shekhar Ghatpande & Co. Company Secretaries having Membership NoFCS: 1659 CP:782 to conduct the Secretarial Audit of your Company for the Financial Year2015-2016. The Secretarial Audit Report is annexed herewith as Annexure - II to thisReport. The Secretarial Audit Report does not contain any major qualification reservationor adverse remark.
d) Cost Audit:
For the Financial Year under Report the appointment of Cost Auditor and obtaining oftheir Report was not applicable to the Company.
17. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Details of Loan Guarantee and Investment under Section 186 of the Companies Act2013 read with Companies (Meeting of Board and its Powers) Rules 2014 are as follows:
a) The Company has not advanced any amount in the nature of Loan to any other entityhowever earlier the Company has paid an advance towards the purchase of Cold Storage toChordia Food Park & Properties Ltd. the final conveyance of which is yet to becompleted.
b) There are no Guarantees issued by Company in accordance with Section 186 of theCompanies Act 2013 read with Rules issued there under.
c) Details of Investments in Equity Shares made by the Company as on 31stMarch 2016 (including Investments made in the previous years) in quoted and unquotedShares are as under:-
|Name of Entity ||Amount as at 31s1 March 2016 (Rs) |
|1. Quoted || |
|(a) 10000 Units of ' 10/ - each of Punjab National Bank ||100000/- |
|2. Unquoted || |
|(a) 1000 Shares of Rupee Co-op. Bank Ltd. of ' 50/ - each ||50000/- |
|TOTAL: ||150000/- |
18. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED IN SUBSECTION
(1) OF SECTION 188 OF THE COMPANIES ACT 2013
Pursuant to the provisions of Section 134 of the Companies Act 2013 read with Rule8(2) of the Companies (Accounts) Rules 2014 the particulars of Contracts or Arrangementsentered into by the Company with Related Parties have as far as possible been done atArm's Length and are in the ordinary course of business and as such the provisions ofSection 188 are not applicable for such transactions. However as an abundant precautionand pursuant to the provisions of Clause 49 of the Listing Agreement [Now as per SEBI[LODR] Regulations 2015 the Company has obtained the approval of the Shareholders of theCompany by way of blanket permission to the said transactions for the period of fourFinancial Years w.e.f. 1st April 2015 in their Annual General Meeting held on26th September 2015 by way of Special Resolution.
The particulars of the transactions so entered into with Related Parties have beenprovided in Form No. AOC-2 attached herewith as Annexure III and in Related Partydisclosures as per AS-18 in Note No. 29 to the Financial Statements.
19. MATERIAL CHANGES AND COMMITMENTS BETWEEN THE DATE OF THE BALANCE SHEET AND THE DATEOF REPORT
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the Financial Year of the Company towhich the Financial Statements relate and the date of this report.
20. SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS
There are no significant/material orders passed by the Regulators or Courts orTribunals impacting the going concern status of your Company and its operations in future.
21. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
A. Conservation of Energy and Technology
a) The Company's operations involve very low energy consumption. Wherever possibleenergy conservation measures have been implemented and there are no further areas whereenergy conservation measures can be taken. However efforts to conserve and optimize theuse of Energy through improved Operational methods and other means will continue.
b) The Company has no collaborations and is engaged in the manufacture of the productsby its own developed methods/operations. The Company has setup a Research and DevelopmentCenter whose emphasis is on product development product quality Cost reduction energyconservation and improvement in process productivity. The Company has also setupLaboratory and Quality Control Department to ensure the quality of different productsmanufactured.
B. Foreign Exchange Earnings and Outgo:
|Sr. Particulars No. ||Amount in |
|i Foreign Exchange earned in terms of actual inflows during the year ||Nil |
|ii Foreign Exchange outgo during the year in terms of actual outflows ||Nil |
22. RISK MANAGEMENT POLICY
At present the Company has not formulated any Policy for Risk Management howeverduring the course of business the Management looks after and study the Business Risksinvolved.
23. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The provisions of Section 135 of the Companies Act 2013 in respect of CSR activitiesare not applicable to the Company. The Company voluntarily also has not undertaken any CSRactivity.
24. BOARD EVALUATION
Pursuant to the provisions of the Companies Act 2013 Rules there under and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board has carriedout an annual performance evaluation of its own performance the Directors individually aswell as the evaluation of the working of its Audit Nomination and Remuneration and otherstatutory committees. Performance evaluation has been carried out as per the Nominationand Remuneration Policy.
25. CHANGE IN THE NATURE OF BUSINESS IF ANY
There has been no change in the nature of business during the Financial Year underreview.
26. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVERESIGNED DURING THE YEAR
Directors appointed/ceased during the Year
|Name of Director ||Designation ||Particulars of Change ||Term of appointment |
|Ms. Gargi Sudhir Sharma ||Woman |
|Appointed as a Director of the Company on 8th May 2015. ||Appointed till 25th September 2020. |
|Mr. Mahendra Sajjanlal Mehta ||Independent |
|Ceased due to Death on 4th July 2015 || |
|Mr. Bapu Ramchandra Gavhane (*) ||Additional |
|Appointed as an Additional Director of the Company on 11th April 2016 ||Upto ensuing Annual General Meeting |
|Dr. Ajit Harichand Mandlecha (*) ||Additional |
|Appointed as an Additional Director of the Company on 11th April 2016 ||Upto ensuing Annual General Meeting |
(*) Appointed during the next Financial Year i.e. 2016-2017 but before the date ofthis Report.
Employees appointed/ceased as Key Managerial Personnel during the Year:
|Name of the KMP ||Designation ||Particulars of Change |
|Mr. Bapu |
|Chief Financial Officer (KMP) ||Appointed as a Chief Financial Officer of the Company on 5th January 2016 |
|Mr. Bapu Ramchandra Gavhane (*) ||Company |
|Resigned on 22nd June 2015 |
|Ms. Tejashree Vinayak Bhalerao (*) ||Company |
|Appointed on 22nd June 2015 |
(*) Mr. Bapu Gavhane resigned as the Company Secretary on 22nd June 2015.Ms. Tejashree Bhalerao a Member of the Institute of the Company Secretaries of India wasappointed as the Company Secretary w.e.f. 22nd June 2015.
27. DIRECTORS PROPOSED TO BE RE-APPOINTED AT THE ENSUING ANNUAL GENERAL MEETING
Mr. Hukmichand Chordia retires by rotation at the ensuing Annual General Meeting andbeing eligible offers himself for re-appointment.
Mr. Bapu Gavhane was appointed as an Additional Director of the Company who holdsoffice upto the date of the ensuing Annual General Meeting. He was subsequently appointedas the Whole Time Director designated as 'Executive Director' of the Company.
Dr. Ajit Mandlecha was appointed as an Additional Director of the Company who holdsoffice upto the date of the ensuing Annual General Meeting.
The necessary resolutions for their appointments as the Directors of the Company areproposed for the approval of the Members in the ensuing Annual General Meeting.
28. COMPOSITION OF AUDIT COMMITTEE
The composition of the Audit Committee has been mentioned in the Corporate GovernanceReport annexed to this Report.
29. PARTICULARS OF EMPLOYEES
Particulars of Employees and information pursuant to Rule 5 of Companies (Appointmentand Remuneration of Managerial Personal) Rules 2014 is given in Annexure IV attached.
30. CASH FLOW
A Cash Flow Statement for the year ended 31s* March 2016 is attached to theFinancial Statement.
31. CORPORATE GOVERNANCE
A report on the Corporate Governance along with the certificate of compliance from theAuditors forms part of the Annual Report.
32. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
During the year under review there were no cases filed pursuant to the aforesaid Act.
Your Directors wish to place on record their sincere appreciation of the continuedsupport from the Company's Bankers viz. Corporation Bank its valued CustomersDistributors Suppliers etc.
The Directors are also thankful to the officials of the Government of India StateGovernments Local Authorities for their continued help and timely assistance extended tothe Company.
| ||By Order of the Board of Directors For Chordia Food Products Limited |
|Place: Pune ||Hukmichand S. Chordia |
|Date: 12th August 2016 ||Chairman |
| ||[DIN: 00389587] |