Your Directors have the pleasure of presenting their Twenty Ninth Annual Report on thebusiness and operations of the Company on standalone basis and the accounts for thefinancial year ended March 31 2017.
| || ||Rs. ( In Lakhs) |
|Particulars ||2016-17 ||2015-16 |
|Sales & Other Income ||70472.56 ||62136.80 |
|Profit before Depreciation & Tax ||2551.79 ||2809.94 |
|Depreciation ||1187.05 ||1277.97 |
|Profit before Tax ||1364.74 ||1531.97 |
|Provision for Taxation including Deferred Taxes ||478.21 ||492.56 |
|Profit after Tax ||886.53 ||1039.41 |
|Profit brought forward from previous year ||4550.84 ||4295.49 |
|Profit available for appropriation ||5437.37 ||5334.91 |
|Appropriation || || |
|Transfer to General Reserve ||200.00 ||422.52 |
|Interim Dividend @ 15% ||- ||166.89 |
|Proposed Final Dividend @ 28 % ||311.52 ||133.51 |
|Corporate Dividend Tax ||63.42 ||61.15 |
|Profit carried to Balance Sheet ||4862.43 ||4550.84 |
REVIEW OF PERFORMANCE
Your Company has delivered another year of strong performance in the financial year2016-17 in a competitive market environment. On the standalone basis your Companyrecorded total sales of Rs. 70427.46 Lakhs with a growth of 13.41% over Rs. 62094.56 Lakhsof the last fiscal. Total Export Turnover of the Company was Rs. 43771.44 Lakhs in theyear 2016-17. The profit after tax for the financial year is Rs. 886.53 Lakhs and duringthe previous year it was Rs.1039.41 Lakhs.
LISTING AT NATIONAL STOCK EXCHANGE OF INDIA LIMITED
Our Company shares were listed at National Stock Exchange of India Limited on July 42016 with scrip code of DAMODARIND.
The Directors recommend a dividend of Rs.2.80 per equity share (28%) per Equity Shareof Rs.10 each for the year 2016-17. The dividend if sanctioned at the forthcoming AnnualGeneral Meeting will be paid to those members whose names appear in the CompanysRegister of Members on June 20 2017. In respect of shares held in dematerialised formthe dividend will be payable on the basis of beneficial ownership as per details furnishedby National Security Depository Limited and Central Depository Services (India) Limited.
TRANSFER TO RESERVES
The Company proposes to transfer Rs. 200.00 Lakhs to the General Reserve out of theamount available for appropriations and an amount of Rs. 4862.43 Lakhs is proposed to beretained in the Profit and Loss Account.
RESERVE AND SURPLUS
Reserves and Surplus stood at to Rs. 8253.36 Lakhs as at March 31 2017 compared to Rs.7741.78 Lakhs as at March 31 2016. The increase was due to retained earnings.
The Board of Directors duly met 6 times during the financial year from April 1 2016 toMarch 31 2017. The dates on which the meetings were held are as follows:
May 27 2016 August 5 2016 August 20 2016 November 9 2016 January 30 2017 andMarch 9 2017.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The current policy is to have an appropriate mix of executive and independentdirectors. On March 31 2017 the Board consists of seven members three of whom areexecutive directors or whole Time Director and four are independent directors.
The policy of the Company on directors appointment and remuneration includingcriteria for determining qualification positive attributes independence of director andother matters as required under sub- section (3) of Section 178 of the Companies Act2013is available on our website www.damodargroup.com. There has been no change in the policysince the last fiscal year. We affirm that remuneration paid to directors is as per theterms laid out in the nomination and remuneration policy of the company.
DECLARATION BY INDEPENDENT DIRECTOR(S)
The Board of Directors hereby certify that the Independent Directors appointed on theBoard meet the criteria pursuant to Section 149(6) of the Companies Act 2013.
Further The Company has received necessary declaration from each independent directorunder section 149 (7) of the Companies Act 20113 that he/she meet the criteria ofindependence laid down in Section 149 (6) of the Companies Act2013 and Regulation 25 ofSEBI (Listing Obligations and Disclosure requirements) Regulations 2015.
The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act. Theperformance of the Board was evaluated by the Board after seeking inputs from all thedirectors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc. The performance of thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition of committees effectiveness ofcommittee meetings.
FAMILIARIATION PROGRAMME FOR INDEPENDENT DIRECTORS
All new independent directors inducted into the Board attend an orientation programme.The Details of training and familiarisation programme are provided in the CorporateGovernance Report and also available on our website www.damodargroup.com.
CODE OF CONDUCT FOR THE PREVENTION OF INSIDER TRADING
The Board of Directors has adopted the Insider Trading Policy in accordance with therequirement of the SEBI (Prohibition of Insider Trading) Regulations 2015 and the InsiderTrading Policy of the Company covering code of practices and procedures for fairdisclosure of unpublished price sensitive information and code of conduct for preventionof insider trading is available on our website www.damodargroup.com.
CHANGE IN NATURE OF BUSINESS IF ANY
During the year there was no change in the nature of business of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTMENT
Mr. Ajay D. Biyani - Retiring Director:
As per the provisions of Companies Act 2013 Mr. Ajay D. Biyani shall retire byrotation at the forthcoming Annual
General Meeting of the Company and being eligible offers himself for re-appointment.The Board is pleased to recommend their re-appointment.
Mr. R. Kumar as Chief Financial Officer:
The Board of Directors at its meeting held on May 29 2017 had appointed Mr. R. Kumaras Chief Financial Officer of the Company in place of Mr. Nirbhay R. Bora.
Mr. R. Kumar having Master Degree in Commerce and he has experience in the field ofCommerce Banking and Finance.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 134(3) of the Companies Act 2013 the Directors would like tostate:
(a) that in the preparation of the annual financial statements for the year ended March31 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
(b) that such accounting policies as mentioned in the Notes to the Financial Statementshave been selected and applied consistently and judgment and estimates have been made thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company as at March 31 2017 and of the profit of the Company for the year ended onthat date;
(c) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) that the annual financial statements have been prepared on a going concern basis;
(e) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
(f) that systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.
COMMITTEE OF THE BOARD
The Board has five committees the Audit Committee the Nomination and RemunerationCommittee the Stake holders Relationship Committee the Corporate Social ResponsibilityCommittee the Risk Management Committee. The detailed note on the composition of theBoard and its committees is provided in the Corporate Governance report section of thisAnnual Report.
STATUTORY AUDITORS AND AUDITORS REPORT
In accordance with Section 139 of the Companies Act 2013 M/s. Jitendra Mishra &Co Chartered Accountants (FRN No. 125334W) were appointed by the shareholders of theCompany at the 27th Annual General Meeting held on August 7 2015 as Statutory Auditorsfor a period of 5 years to hold office until the conclusion of the 32nd Annual GeneralMeeting of the Company in calendar year 2020.
In accordance with the provisions of Section 139 142 and other applicable provisionsof the Companies Act 2013 and the Companies (Audit and Auditors) Rules 2014 theappointment of the Statutory Auditor is required to be ratified by the shareholders atevery Annual General Meeting during their tenure.
M/s. Jitendra Mishra & Co Chartered Accountants (FRN No. 125334W) have confirmedthat they are eligible for having their appointment as Statutory Auditors ratified at thisAnnual General Meeting (AGM). Accordingly approval of shareholders is being sought atthis AGM for ratification of their appointment.
The Auditors Report does not contain any qualification reservation or adverse remarkon the financial statements for the year ended March 31 2017.
SECRETARIAL AUDIT REPORT
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. Pramod Jain & Co. Practicing Company Secretaries as its SecretarialAuditor to undertake the Secretarial Audit for the financial year 2017-18.
The Secretarial Audit Report of M/s. Pramod Jain & Co. Practicing CompanySecretaries for the financial year ended March 312017 is annexed as Annexure-A.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
M/s. Dilip M. Bathija Cost Accountants (FRN No.100106) have been duly appointed asCost Auditors for conducting Cost Audit in respect of products manufactured by the Companywhich are covered under the Cost Audit Rules for current financial year ending March 312018. They were also the Cost Auditors for the previous year ended March 31 2017. Asrequired by Section 148 of the Companies Act 2013 necessary resolution has been includedin the Notice convening the Annual General Meeting seeking ratification by the Members tothe remuneration proposed to be paid to the Cost Auditors for the financial year endingMarch 31 2018.
As per requirements of Section 138(1) of the Companies Act 2013 read with rule 13 ofthe Companies (Accounts) Rules 2014 the Board of Directors of the Company had appointedM/s. Shailendra Jain & Associates Chartered Accountants as Internal Auditor of theCompany to conduct Internal Audit of business processes financial reporting controlscompliance with applicable laws regulations etc for the year 2016-17.
The Board of Director appointed M/s. Pokharna Somani & Associates CharteredAccountants as internal Auditor of the Company for the F.Y. 2017-18.
Details relating to Fixed Deposits covered under Chapter V of the Companies Act2013as under:
|a. Accepted during the year ||Rs. 59944000/- |
|b. Remained unpaid or unclaimed as at the end of the year ||Rs. 325000 |
|c. Whether there has been any default in repayment of deposits or payment of interest thereon during the year ||Nil |
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of the Company and its future operations.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of Section 124 and 125 of the Companies Act 2013 relevantamounts which remained unpaid or unclaimed for a period of seven years have beentransferred by the Company from to time to time on due dates to the Investor Educationand Protection Fund.
Pursuant to the provisions of Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has uploaded the details of unpaid and unclaimed amounts lying with the Company ason August 20 2016 (date of last Annual General Meeting) on the Companys website(www.damodargroup.com) as also on the Ministry of Corporate Affairs website.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.
The Company has adopted the best possible Corporate Governance norms and it has beenour endeavour to comply and upgrade to the changing norms.
A separate section on corporate governance and a certificate from the PracticingCompany Secretary regarding compliance of conditions of Corporate Governance as stipulatedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
As per Regulations 17 (8) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations2015 a Certificate of the Managing Director inter alia confirming thecorrectness of the financial statements adequacy of the internal control measures andreporting to matters to the Audit Committee in terms of the said Clause is also enclosedas a part of this Report.
At present there is no identifiable risk which in the opinion of the Board maythreaten the existence of the Company.
MANAGEMENT DISCUSSION AND ANALYSIS
As required under Regulation 34(2) (e) of the Securities Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 the ManagementDiscussion and Analysis Report is presented in a separate section forming part of theAnnual Report.
VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES
The Company has established a vigil mechanism for directors and employees to reportgenuine concerns. The vigil mechanism provides for adequate safeguards againstvictimization of person who use vigil mechanism and also provide direct access to Chairmanof the Audit Committee and Managing Director of the Company in appropriate and exceptionalcases.
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.damodargroup.com
DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION & REDRESSAL)ACT 2013
Your Company is committed to provide a work environment which ensures that every womanemployee is treated with dignity respect and equality. There is zero- tolerance towardssexual harassment and any act of sexual harassment invites serious disciplinary action.
The Company has established a policy as per under Section 22 of Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013 against SexualHarassment for its employees. The policy allows any employee to freely report any such actand prompt action will be taken thereon. The Policy lays down severe punishment for anysuch act. Further your Directors state that during the year under review there were nocases of sexual harassment reported to the Company.
MATERIAL CHANGES FROM END OF FINANCIAL YEAR TILL DATE OF REPORT
There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company to whichthe financial statements relate and the date of the report other than those disclosed inthe financial statements.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO
The information required under section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules2014 is given in the Annexure-B to this report.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexedherewith as Annexure-C.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Corporate Social Responsibility is the Companys intent to make a positivedifference to the society. As per Companies Act 2013 which requires Companies contributesome part of its profits towards the CSR activities. We have adopted Corporate SocialResponsibility as a strategic tool for sustainable growth. With the CSR Vision Build apowerful partnership Society for Sustainable Development and to improve the quality oflife of the communities we serve through long tern stakeholders value creation. Weare committed to operate our business with emphasis on CSR in all areas of our operation.The Corporate Social Responsibility Policy enumerating the CSR activities to be undertakenby the Company in accordance with Schedule VII to the Companies Act2013 was recommendedto the Board and the Board adopted the same.
The said policy is also available on the website www.damodargroup.com. The AnnualReport under CSR activities is annexed to the report as Annexure D.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The prescribed particulars of Employee required under section 197 read with Rule 5 ofthe Companies (Appointment and remuneration of Managerial Personnel) Rules 2014 isattached as Annexure-E as form the part of Boards Report.
PARTICULAR OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
The Company has formulated a policy on dealing with Related Party Transaction. The saidpolicy is available on the Company's website www.damodargroup.com
Pursuant to the provisions of Regulation 23 of Securities Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 prior approval ofAudit Committee was sought for entering into related party transactions. During the yearthe Company had entered into related party transaction with family members of executivedirectors of the company as per Listing Regulations. The Company had taken the approvalfrom the shareholders at Annual General Meeting held on August 20 2016 for entering intorelated party transaction as per listing regulations and the particulars contracts enteredduring the year as per form AOC-2 is enclosed as Annexure-F.
DISCLOSURE OF POLICIES
The SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 mandatedthe formulation of certain policies for all listed Companies. All our Corporate Governancepolicies are available on our website www.damodargroup.com. All our corporate policies arereviewed periodically by the Board and undated based on need and new compliancerequirement.
In addition to its Code of Conduct and Ethics key policies that have adopted by theCompany are as follows:
NOMINATION REMUNERATION AND EVALUATION POLICY: The policy formulates the criteria fordetermining qualification competencies positive attributes and independence of a directorand also criteria for determining the remuneration of the directors key managerialpersonnel and other employees. The said policies is attached as Annexure-G as form thepart of Boards Report.
RELATED PARTY TRANSACTION POLICY: The Policy regulated all transaction between theCompany and its related party in terms of Section 188 of the Companies Act 2013
CORPORATE SOCIAL RESPONCIBILITY: The Policy outlines the Company strategy to bringabout a positive impact on society through programme relating to hunger educationhealthcare and environment.
POLICY ON MATERIAL SUBSIDIARIES: The policy used to determine the material subsidiariesand material non listed Indian subsidiaries of the Company.
WHISTLE BLOWER POLICY: The Company adopted the whistle blower mechanism for directorand employee to report concerns about unethical behavior actual or suspended fraudviolation of Company rules of other matters or activity on account of which the interestof the company affected.
INSIDER TRADING POLICY: The policy provides the framework in dealing with securities ofthe Company.
INTERNAL CONTROL SYSTEM AND AUDIT
In terms of Section 134 of the Companies Act 2013 and provisions of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has an InternalControl System commensurate with the size scale and complexity of its operations. Tomaintain its objectivity and independence the Internal Auditors report to the Chairman ofthe Audit Committee of the Board.
The Internal Auditors monitor and evaluate the efficacy and adequacy of internalcontrol system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and corrective actionsthereon are presented to the Audit Committee on a regular basis.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
(A) ISSUE OF SHARE WITH DIFFERENTIAL RIGHTS
The Company has not issued any shares with differential rights and hence no disclosureis required as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of theCompanies (Share Capital and Debenture) Rules 2014.
(B) ISSUE OF SWEAT EQUITY SHARES
The Company has not issued any sweat equity shares during the year under review andhence no disclosure is required as per provisions of Section 54(1)(d) of the Act read withRule 8(13) of the Companies (Share Capital and Debenture) Rules 2014.
(C) ISSUE OF EQUITY SHARES UNDER EMPLOYEE STOCK OPTION SCHEME
The Company has not issued any equity shares under Employees Stock Option Scheme duringthe year under review and hence no disclosure is required as per provisions of Section62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture)Rules 2014.
Your Directors thank the viewers suppliers bankers Financial Institutions Centraland State Governments and Shareholders for their consistent support to the Company. TheDirectors also sincerely acknowledge the significant contributions made by all theemployees for their dedicated services to the company.
| ||For and on behalf of the Board |
| ||Sd/- |
|Place: Mumbai ||Arunkumar Biyani |
|Date: May 29 2017 ||Chairman |