TO THE SHAREHOLDERS
Your Directors have pleasure in presenting the 34th Directors Report of yourCompany along with the financial statements for the financial year ended 31st March 2016.
1. OPERATING RESULTS
Certain key aspects of your Companys performance during the financial year ended31st March 2016 as compared to the previous financial year are summarised below:
(Rs. in 000)
| ||Standalone ||Consolidated |
|Particulars ||Year Ended ||Year Ended |
| ||31.03.2016 ||31.03.2015 ||31.03.2016 ||31.03.2015 |
|Income for the year ||173678.98 ||188353.02 ||557600.07 ||568299.69 |
|Profit before Interest Depreciation and Tax ||3568.20 ||20855.22 ||16799.44 ||34159.97 |
|Finance Charges ||3927.49 ||3823.17 ||28180.46 ||9069.21 |
|Profit before Depreciation and Taxes ||(359.30) ||17032.05 ||(11381.01) ||25090.76 |
|Depreciation & Amortization ||4087.53 ||3601.59 ||15442.36 ||7837.11 |
|Provisions for Taxation/ Deferred Tax ||(421.25) ||2660.39 ||12887.34 ||2995.24 |
|Prior Period Items / Exceptional Items ||(628.48) ||169.83 ||28462.91 ||1999.54 |
|Minority Interest & Profit from Associate Company ||- ||- ||- ||- |
|Net Profit for the Current Year ||(3397.09) ||10600.24 ||(68173.62) ||12258.87 |
|Earlier Years Balance Brought Forward ||(53584.25) ||(64720.18) ||38116.33 ||25369.65 |
|Net Profit available for Appropriation ||575.63 ||535.69 ||575.63 ||487.80 |
|Transfer to/from General Reserves ||- ||- ||- ||- |
|Balance carried to Balance Sheet ||(56405.71) ||(53584.25) ||(29481.66) ||38116.33 |
The Directors do not recommend any dividend for the financial year ended 31st March2016.
3. SHARE CAPITAL
During the year under review there was no change in the Companys share capital.
The Paid up Capital of the Company is Rs. 64710140/- comprising of 6471014 EquityShares of Rs. 10/- each.
4. OVERVIEW OF OPERATIONS:
During the year under review on a consolidated basis your Company recorded a totalincome of Rs. 557600.07 (000) as compared to last years income of Rs.568299.69 (000) and net loss of Rs. 68173.62 (000) as compared to lastyears net profit of Rs. 12258.87 (000). For further information kindly referto Management Discussion and Analysis Report forming 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 2013and as prescribed in Form No. MGT-9 of the Companies (Management and Administration)Rules 2014 is appended as Annexure I.
6. NUMBER OF MEETINGS OF THE BOARD
The Board met 4 (four) times in financial year 2015-16 viz. on 12th May 2015 27thJuly 2015 31st October 2015 and 6th February 2016.
7. DIRECTORS RESPONSIBILITY STATEMENT
Your Directors hereby confirm that:
i. In the preparation of the annual accounts for financial year ended 31st March 2016the applicable accounting standards have been followed along with proper explanationrelating 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 2016 and of the loss ofthe 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 2016 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 Companies Act 2013 confirming that they meet thecriteria of independence under Section 149(6) of the Companies Act 2013 and Regulation 16of the Securities Exchange Board of India (Listing Obligations and DisclosuresRequirements) Regulations 2015 (Listing Regulations).
9. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The Policy of the Company on Directors appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a Directorand other matters provided under sub-section (3) of Section 178 is appended as AnnexureII to this Annual Report.
10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statements.
11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year 2015-16 your Company has entered into transactions withrelated parties as defined under section 2(76) of the Companies Act 2013 read with theCompanies (Specification and Definitions Details) Rules 2014 in accordance with theprovisions of the Companies Act 2013 Rules issued thereunder erstwhile Clause 49 of theListing Agreement and Regulation 23 of the Listing Regulations. During the financial year2015-16 the Company has not entered into transactions with related parties which qualifyas material transactions under the erstwhile Listing Agreement / Listing Regulations. TheForm AOC- 2 pursuant to Section 134 (3)(h) of the Companies Act 2013 read with Rule 8(2)of the Companies (Accounts) Rules 2014 is set out as Annexure III.
The details of related party transactions as required under Accounting Standard-18 areset out in notes to accounts to the Standalone Financial Statements forming part of thisAnnual Report.
The Policy on Related Party Transactions may be accessed on the Companys websiteat the link:http://www.deltamagnetsgroup.com/dml/downloads/policies/Related-Party-Transaction-Policy.pdf.
12. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
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 the report.
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 Companies Act2013 read with the Companies (Accounts) Rules 2014 is given in Annexure IV.
14. BUSINESS RISK MANAGEMENT
The Board of Directors of the Company have 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 on the businessobjectives and enhance the Companys 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 aCompanys business.
15. VIGIL MECHANISM
The Company has adopted a Vigil Mechanism Policy for directors and employees to reportgenuine concerns and to provide for adequate safeguards against victimization of personswho may use such mechanism. The said policy is posted on the Companys websitewww.deltamagnets.com.
16. ANNUAL EVALUATION OF PERFORMANCE OF THE BOARD
Pursuant to the provisions of the Companies Act 2013 and Regulation 19 of the ListingRegulations the Board has carried out an annual evaluation of its own performanceperformance of the Directors as well as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee has defined the evaluation criteria for theBoard its Committees and Directors.
The Boards functioning was evaluated after taking inputs from the Directors onvarious aspects 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 and Remuneration Committee reviewed the performance of theindividual directors on aspects such as attendance and contribution at Board/ CommitteeMeetings and guidance/support to the management outside Board/ Committee Meetings. Inaddition the Chairman was also evaluated on key aspects of his role including settingthe strategic agenda of the Board encouraging active engagement by all Board 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 IndependentDirectors performance of Non-Independent Directors performance of the board as a wholeand performance of the chairman was evaluated taking into account the views of executivedirectors and non-executive directors.
17. SUBSIDIARY COMPANIES
Your Company as on 31st March 2016 has 2 direct subsidiaries. During the year underreview no company has become/ceased to be a subsidiary joint venture or associatecompany.
During the year the Board of Directors reviewed the affairs of the subsidiaries. Inaccordance with Section 129(3) of the Companies Act 2013 the Company has preparedconsolidated financial statements of the Company and all its subsidiaries which form partof the Annual Report. A report on the performance and financial position of each of thesubsidiaries associates and joint venture companies as per the Companies Act 2013 isprovided as Annexure A to the consolidated financial statement and hence notrepeated here for the sake of brevity.
In accordance with Section 136 of the Companies Act 2013 the audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of each of its subsidiary are available on Companyswebsite www.deltamagnets.com. These documents will also be available for inspection duringbusiness hours at our Registered 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 theCompanys website at the link:http://www.deltamagnetsgroup.com/dml/downloads/policies/Policy-for-Determining-Material-Subsidiaries.pdf.
18. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE COMPANIES ACT 2013
During the year under review the Company has not accepted any deposit from the public.
19. 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.
20. 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 withthe Accounting Standards prescribed in the Companies (Accounting Standards) Rules 2006that continue to apply under Section 133 and other applicable provisions if any of theCompanies Act 2013 read with Rule 7 of the Companies (Accounts) Rules 2014 and relevantprovisions of the Companies Act 2013 to the extent applicable. These are in accordancewith generally accepted accounting principles in 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 Companys policies safeguarding of Companys assetsprevention and 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.
21. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the Articles of Association of the Company and the provisions of theSection 152(6)(e) of the Companies Act 2013 Ms. Ambika Kothari (DIN: 01162900) Directorof the Company will retire by rotation at the ensuing Annual General Meeting and beingeligible offers herself for re-appointment.
1. Statutory Auditor
The Board of Directors recommends to re-appoint M/s. Amit Desai & Co. CharteredAccountants who were appointed as Statutory Auditors of the Company at Annual GeneralMeeting held on 25th September 2014 to hold office from the conclusion of 32nd AnnualGeneral Meeting till the conclusion of 36th Annual General meeting subject toratification of their appointment at every Annual General Meeting. The Board of Directorsof the Company at its meeting held on 12th May 2016 recommended to members of the Companyratification of appointment of M/s. Amit Desai & Co Chartered Accountants as theStatutory Auditors of the Company for financial year 2016-2017.
Your Company has received a letter from M/s. Amit Desai & Co to the effect thattheir re-appointment if made would be under the second and third proviso to Section 139(1) of the Companies Act 2013 and that they are not disqualified within the meaning ofSection 141 of the Companies Act 2013 read with Rule 4(1) of the
Companies (Audit and Auditors) Rules 2014.
Statutory Auditors Emphasis on Matter and Managements Reply
(a) As regard Auditors observation with respect to utilization of MAT creditentitlement of Rs. 28.68 Lacs as per management future business projections such creditwill be fully utilized within the stipulated period.
(b) With regards to the Auditors observation in respect of one of subsidiary companiesbecoming potentially sick the management is in process of chalking out the final plan torevive the company financially in near future.
2. Secretarial Auditor
Pursuant to the provisions of Section 204 of Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorsof the Company had appointed M/s. A. K. Jain & Co. Company Secretaries in Practice toundertake the Secretarial Audit of the Company for the year ended 31st March 2016. TheSecretarial Audit Report is annexed as Annexure V.
There are no qualifications reservations or adverse remarks or disclaimers made bySecretarial Auditor of the Company in his secretarial audit report.
23. 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 part of thisAnnual Report.
24. AUDIT COMMITTEE OF THE COMPANY:
The Companys Audit Committee comprises the following Directors:
1. Mr. Rajesh Jaggi (Chairman);
2. Dr. Ram H. Shroff;
3. Mr. Javed Tapia;
4. Dr. Vrajesh Udani
The composition of the Audit Committee is in compliance with the requirements ofSection 177 of the Companies Act 2013 and Regulation 18 of the Listing Regulations.
25. PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of Companies Act 2013 read with Rules5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 a statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in the said rules and disclosures pertainingto remuneration and other details as required under Section 197(12) of Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are provided in Annexure VI to this Annual Report.
Your Directors express their sincere appreciation of 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 |
|Mumbai 10th August 2016 ||DIN: 00234797 |
|Registered Office: || |
|B-87 MIDC Ambad || |
|Nashik-422 010 Maharashtra. || |
|CIN: L32109MH1982PLC028280 || |
|Email ID: firstname.lastname@example.org || |
|Website: www.deltamangets.com || |
|Tel No: 91-253-2382238 || |
|Fax No: 91-253-2382926 || |