Your Directors have pleasure in presenting the Twenty-Sixth (26th)Directors' Report of your Company along with the financial statements for the FinancialYear ended 31st March 2017.
1. OPERATING RESULTS
Certain key aspects of your Company's performance during the Financial Year ended 31stMarch 2017 as compared to the previous Financial Year are summarised below:
| || || |
(Rs. in Lakhs)
| ||Standalone ||Consolidated |
|Particulars ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 |
|Income for the year ||28278.61 ||24509.38 ||45960.14 ||38215.07 |
|Profit before Interest Depreciation and Tax ||10199.18 ||8735.05 ||16890.89 ||12760.23 |
|Finance Charges ||(1355.11) ||(1544.04) ||(3497.42) ||(4134.71) |
|Profit before Depreciation and Taxes ||8844.07 ||7191.01 ||13393.47 ||8625.52 |
|Depreciation & Amortisation ||(1205.31) ||(1113.10) ||(3611.76) ||(3594.81) |
|Provisions for Taxation ||(2378.63) ||(1868.41) ||(2803.46) ||(2021.01) |
|Exceptional Items ||2.10 ||(500.00) ||419.93 ||1047.84 |
|Minority Interest & Share of Profit from Associate & Joint Venture Company ||- ||- ||(23.29) ||(235.56) |
|Net Profit for the Current Year ||5262.23 ||3709.50 ||7374.89 ||3821.98 |
|Earlier Years Balance Brought forward ||20233.81 ||16795.39 ||14531.30 ||8858.70 |
|Net Profit available for Appropriation ||25496.04 ||20504.89 ||21906.19 ||12680.68 |
|Appropriation: || || || || |
|Dividend on Equity Shares ||(462.29) ||(230.66) ||(462.29) ||(230.66) |
|Dividend Distribution Tax (Net) ||(94.11) ||(46.96) ||(94.11) ||(46.96) |
|Amount Transfered from Non Controlling Interest & Other Adjustment ||- ||6.54 ||1.63 ||2128.24 |
|Balance at the year end ||24939.64 ||20233.81 ||21351.42 ||14531.30 |
Your Directors recommend for approval of the Members at the ensuing Annual GeneralMeeting dividend of Rs. 0.35/- per Equity Share (35%) of Rs. 1/- each for the FinancialYear ended 31st March 2017 (previous year Rs. 0.20/- per Equity Share ofnominal value of Rs. 1/- each). The dividend will be paid in compliance with theapplicable Rules and Regulations.
3. SHARE CAPITAL
During the year the Company has issued and allotted 960000 Equity Shares of theCompany to eligible employees on exercise of options granted under Employee Stock OptionScheme. Consequently the issued subscribed and paidup capital of the Company hasincreased from 230664104 Equity Shares of Rs. 1/- each to 231624104 Equity Shares ofRs. 1 /- each.
4. OVERVIEW OF OPERATIONS
During the year under review on a consolidated basis your Company recorded a totalincome of Rs. 45960.14 Lakhs as compared to last year's income of Rs. 38215.07 Lakhs andnet profit of Rs. 7374.89 Lakhs as compared to last year's Net profit of Rs. 3821.98Lakhs. For further information kindly refer to Management Discussion and Analysis Reportforming a part of this Annual Report.
5. EXTRACT OF ANNUAL RETURN
The Extract of Annual Return as provided under Section 92(3) of the Companies Act 2013(the Act) and as prescribed in Form No. MGT-9 of the Companies (Management andAdministration) Rules 2014 is appended as Annexure I to this Annual Report.
6. NUMBER OF MEETINGS OF THE BOARD
The Board met Six (6) times in Financial Year 2016-17 viz. on 25th April2016 01st August 2016 30th August 2016 25th October2016 17th January 2017 and 22nd March 2017.
7. DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors hereby confirm that:
i. In the preparation of the annual accounts for Financial Year ended 31stMarch 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures;
ii. The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at 31st March 2017 and of theprofit 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 this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv. The Directors have prepared the annual accounts for Financial Year ended 31stMarch 2017 on a going concern' basis.
v. The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and have been operatingefficiently.
vi. The Directors have devised proper systems to ensure compliance with provisions ofall applicable laws and that such systems were adequate and operating effectively.
8. DECLARATION BY INDEPENDENT DIRECTORS
The Independent Directors of the Company have submitted the declaration of Independenceas required under Section 149(7) of the Act confirming that they meet the criteria ofindependence under Section 149(6) of the Act and Regulation 16 (1)(b) of the SecuritiesExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 (Listing Regulations).
9. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Policy of the Company on Directors' appointment and remuneration including criteriafor determining qualifications positive attributes independence of a Director and othermatters provided under sub-section (3) of Section 178 of the Act and Regulation 19 ofListing Regulations is appended as Annexure II to this Annual Report.
10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OFTH E ACT
The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Act read with Companies (Meetings of Board and Its Powers) Rules 2014are given in the notes to the Financial Statements forming part of this Annual Report.
11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the Financial Year 2016-17 your Company has entered into transactions withrelated parties as defined under section 2(76) of the Act read with the Companies(Specification and Definitions Details) Rules 2014 and Rules made thereunder Regulation23 of the Listing Regulations. During the Financial Year 2016-17 transactions withrelated parties which qualify as material transactions as per Listing Regulations aregiven in Form AOC - 2 of the Companies (Accounts) Rules 2014 in Annexure III tothis Annual Report.
The details of related party transactions as required under IND AS-24 are set out innotes to accounts to the Standalone Financial Statements forming part of this AnnualReport.
The Policy on Related Party Transactions may be accessed on the Company's website atthe link: http://www. deltacorp.in/pdf/related-party-transaction-policy.pdf.
12. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
i) Qualified Institutional Placement
QIP Committee of the Board of Directors of the Company at its meeting held 18thMay 2017 has allotted 35483874 Equity Shares to eligible qualified institutionalbuyers at the issue price of Rs. 155 per Equity Share under the SEBI Regulations andSection 42 of the Act (including the rules made thereunder).
ii) Scheme of Amalgamation
In the matter of Scheme of Amalgamation of Gauss Networks Private Limited with DeltaCorp Limited the National Company Law Tribunal (NCLT) Mumbai Bench has passed the orderon 08th June 2017 sanctioning the Scheme of Amalgamation. The Company hasreceived the certified copy of the order on 04th July 2017 and the same hasbeen submitted to all the statutory authorities including BSE Limited National StockExchange of India Limited and Registrar of Companies Pune.
13. PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo as required under Section 134(3)(m) of the Act read with theCompanies (Accounts) Rules 2014 is annexed to this Annual Report as Annexure IV.
14. BUSINESS RISK MANAGEMENT
The Board of Directors of the Company has constituted a Risk Management Committee toframe implement and monitor the risk management plan for the Company.
The Company has a robust Risk Management framework to identify evaluate business risksand opportunities. This framework seeks to create transparency minimize adverse impact onthe business objectives and enhance the Company's competitive advantage.
The business risk framework defines the risk identification and its management approachacross the enterprise at various levels including documentation and reporting. Theframework helps in identifying risks trend exposure and potential impact analysis on aCompany's business.
15. CORPORATE SOCIAL RESPONSIBILITY
The Board has constituted a Corporate Social Responsibility (CSR) Committee inaccordance with Section 135 of the Act. Your Company's Annual Report on the CSRactivities undertaken during the Financial Year ended 31st March 2017 inaccordance with Section 135 of the Act and Companies (Corporate Social ResponsibilityPolicy) Rules 2014 is annexed to this Annual Report as Annexure V.
16. VIGIL MECHANISM
The Company has adopted a Vigil Mechanism and Whistle Blower Policy for Directors andEmployees in compliance with the provisions of Section 177(10) of the Act and Regulation22 of the Listing Regulations to report genuine concerns and to provide for adequatesafeguards against victimization of persons who may use such mechanism. The said policy isalso available on the Company's website www.deltacorp.in.
17. ANNUAL EVALUATION OF PERFORMANCE OF THE BOARD
Pursuant to the provisions of the Act and Regulation 19 of the Listing Regulationsthe Board has carried out an annual evaluation of its own performance performance of theDirectors as well as the evaluation of the working of its Committees.
The Nomination Remuneration and Compensation Committee has defined the evaluationcriteria for the Board its Committees and Directors.
The Board's functioning was evaluated after taking inputs from the Directors on variousaspects including inter alia degree of fulfillment of key responsibilities Boardstructure and composition establishment and delineation of responsibilities to variousCommittees effectiveness of Board processes information and functioning.
The Committees of the Board were evaluated after taking inputs from the Committeemembers on the basis of criteria such as degree of fulfillment of key responsibilitiesadequacy of Committee composition and effectiveness of meetings.
The Board and the Nomination Remuneration and Compensation Committee reviewed theperformance of the individual directors on aspects such as attendance and contribution atBoard/ Committee Meetings and guidance/support to the management outside Board/ CommitteeMeetings. In addition the Chairman was also evaluated on key aspects of his roleincluding setting the strategic agenda of the Board encouraging active engagement by allBoard members.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non-Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole.
In a separate meeting of independent directors performance of Non-IndependentDirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and non-executivedirectors.
18. SUBSIDIARY COMPANIES
The Company as on 31st March 2017 has 9 direct subsidiaries 2 step downsubsidiaries 1 joint venture and 1 associate company. During the year under review AtledTechnologies Private Limited Caravela Casino Goa Private Limited and Delta Lifestyle andEntertainment Private Limited ceased to be subsidiaries of the Company. During theFinancial Year 2016-17 under review Deltin Hotel & Resorts Private Limited has becomethe subsidiary of the company.
During the year the Board of Directors reviewed the affairs of the subsidiaries. Inaccordance with Section 129(3) of the Act the Company has prepared consolidated financialstatements of the Company and all its subsidiaries which form part of the Annual Report.A report on the performance and financial position of each of the subsidiaries associateand joint venture company as per the Act is provided in the financial statement and hencenot repeated here for the sake of brevity.
In accordance with Section 136 of the Act the audited financial statements includingthe consolidated financial statements and related information of the Company and auditedaccounts of each of its subsidiaries are available on Company's website www.deltacorp.in.These documents will also be available for inspection during working hours at ourRegistered Office of the Company.
Further the Company has 1 material non-listed Indian subsidiary as defined underRegulation 16(1)(c) of the Listing Regulations.
The Policy for determining material subsidiaries as approved may be accessed on theCompany's website at the link:http://www.deltacorp.in/pdf/policy-for-determining-material-subsidiaries.pdf.
19. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE ACT
The Company has neither accepted nor renewed any deposits during the Financial Year2016-17 in terms of Chapter V of the Act.
20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of the Company and its future operations.
21. INTERNAL CONTROL WITH REFERENCE TO FINANCIAL STATEMENTS
The Company has in place adequate internal financial control with reference tofinancial statements.
The Company has adopted accounting policies which are in line with the AccountingStandards prescribed in the Companies (Accounting Standards) Rules 2006 that continue toapply under Section 133 and other applicable provisions if any of the Act read withRule 7 of the Companies (Accounts) Rules 2014 and relevant provisions of the Act to theextent applicable. These are in accordance with generally accepted accounting principlesin India.
The Company in preparing its financial statements makes judgments and estimates basedon sound policies and uses external agencies to verify/ validate them as and whenappropriate. The basis of such judgments and estimates are also approved by the StatutoryAuditors and Audit Committee.
The Internal Auditor evaluates the efficacy 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 detection of frauds and errors and timely preparation of reliable financialinformation etc. Based on the report of internal audit function process owners undertakecorrective action in their respective areas and thereby strengthen the controls.Significant audit observations and corrective actions thereon are presented to the AuditCommittee of the Board.
22. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Section 152(6)(e) of the Act Mr. AshishKapadia (DIN: 02011632) Director of the Company will retire by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.
The Board of Directors of the Company vide its resolution dated 22nd March2017 have appointed Mr. Chetan Desai (DIN: 0003595319) as an Additional Director of theCompany in accordance with the provisions of Section 161 of the Act and Rules madethereunder.
He holds the office as an Additional Director upto the date of the ensuing AnnualGeneral Meeting of the Company. The Company has received a notice from a member proposinghis appointment at the ensuing Annual General Meeting as an Non- Executive NonIndependent Director of the Company in accordance with provisions of Section 149 and anyother applicable provisions of the Act and the Rules made thereunder read with ScheduleIV of the Act.
1. Statutory Auditor
The Board of Directors recommends ratification of appointment of M/s. Walker Chandiok& Co. LLP Chartered Accountants (Firm Registration No: 001076N/N500013) who wereappointed as Statutory Auditors of the Company at last Annual General Meeting. M/s. WalkerChandiok & Co LLP Chartered Accountants (Firm Registration No: 001076N/N500013)holds office from the conclusion of 25th Annual General Meeting till theconclusion of 30th Annual General Meeting of the Company subject toratification of their appointment at every Annual General Meeting. The Board of Directorsof the Company at its meeting held on 30th May 2017 recommended to members ofthe Company ratification of appointment of M/s. Walker Chandiok & Co LLP CharteredAccountants (Firm Registration No: 001076N/N500013) as the Statutory Auditors of theCompany for Financial Year 2016-2017.
Your Company has received a letter from M/s. Walker Chandiok & Co. LLP CharteredAccountants (Firm Registration No: 001076N/N500013) to the effect that theirre-appointment if made would be under the second and third proviso to Section 139 (1) ofthe Act and that they are not disqualified within the meaning of Section 141 of the Actread with Rule 4(1) of the Companies (Audit and Auditors) Rules 2014.
There are no qualifications reservations or adverse remarks or disclaimers made byStatutory Auditor of the Company in his audit report.
2. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors of the Companyhave appointed M/s. A. K. Jain & Co. Company Secretaries in Practice to undertake theSecretarial Audit of the Company for the year ended 31st March 2017. TheSecretarial Audit Report is annexed as Annexure VI to this Annual Report.
There are no qualifications reservations or adverse remarks or disclaimers made bySecretarial Auditor of the Company in his secretarial audit report.
24. CORPORATE GOVERNANCE
Pursuant to Listing Regulations the Management Discussion & Analysis Report andCorporate Governance Report together with Certificate from Practicing Company Secretaryon compliance with the conditions of Corporate Governance as laid down forms a part ofthis Annual Report.
25. BUSINESS RESPONSIBILITY REPORT
A Business Responsibility Report as per Regulation 34 of the Listing Regulationsdetailing the various initiatives taken by the Company on the environmental social andgovernance front forms an integral part of this report.
26. AUDIT COMMITTEE OF THE COMPANY
The Company's Audit Committee comprises of the following Directors:
1. Mr. Ravinder Kumar Jain (Chairman);
2. Mr. Ashish Kapadia;
3. Mr. Rajesh Jaggi; and
4. Dr. Vrajesh Udani
The composition of the Audit Committee is in compliance with the requirements ofSection 177 of the Act and Regulation 18 of the Listing Regulations.
27. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits set out in the said rules and disclosures pertaining to remunerationand other details as required under Section 197(12) of the Act read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are providedin Annexure VII to this Annual Report.
28. EMPLOYEES STOCK OPTION SCHEME
As required in terms of regulation 14 of the Securities and Exchange Board of India(Share Based Employee Benefits) Regulations 2014 and in terms of Rule 12 of Companies(Share Capital and Debentures) Rules 2014 the disclosure relating to DELTA CORP ESOS2009 is given in Annexure VIII to this Annual Report.
Your Directors express their sincere appreciation for the co-operation received fromshareholders bankers and other business constituents during the year under review. YourDirectors also wish to place on record their deep sense of appreciation for the commitmentdisplayed by all executives officers and staff resulting in the successful performanceof the Company during the year.
| ||For and on behalf of the Board of Directors |
| ||Jaydev Mody |
| ||Chairman |
| ||DIN: 00234797 |
|Mumbai 24th July 2017 || |
|Registered Office: || |
|10 Kumar Place 2408 General Thimayya Road || |
|Pune - 411 001 Maharashtra. || |
|CIN : L65493PN1990PLC058817 || |
|Email ID : firstname.lastname@example.org || |
|Website : www.deltacorp.in || |
|Tel. No. : 91-22-40794700 || |
|Fax No. : 91-22-40794777 || |