Your Directors have pleasure to present the 25th Annual Report and the Audited Accountsfor the financial year ended 31st March 2016.
1. FINANCIAL RESULTS
| ||Year ended 31.03.2016 ||Year ended 31.03.2015 |
| ||(Rs. in lakhs) ||(Rs. in lakhs) |
|Sales ||6827.99 ||6295.93 |
|Gross Operating Profit before depreciation and exchange variation ||1259.01 ||1196.17 |
|Profit after depreciation but before exchange variation ||1149.16 ||1091.32 |
|Profit after depreciation exchange variation and before Exceptional Items ||1534.83 ||1452.54 |
|Profit after Exceptional items ||1534.83 ||1452.54 |
|Profit after Tax ||1013.66 ||934.60 |
|Appropriations: || || |
|General Reserves ||828.27 ||749.21 |
|Proposed Dividend ||154.03 ||154.03 |
|Tax on dividend ||31.36 ||31.36 |
|Total ||1013.66 ||934.60 |
Your Directors are pleased to recommend for your consideration a Dividend of Rs. 1.50per share (15% of face value Rs.10/-) on the equity capital of the company for thefinancial year ended 31st March 2016 aggregating an amount of Rs. 154.03 lakhs.
3. TRANSFERS TO RESERVES AND RETENTION IN THE PROFIT AND LOSS ACCOUNT ETC:
The Company proposes to transfer an amount of Rs. 828.27 lakhs to Reserves during thefinancial year under review.
Cash and cash equivalents as at 31st March 2016 was Rs. 5185.92 lakhs. The companycontinues to focus on judicious management of its working capital receivablesinventories and other working capital parameters and they were kept under strict checkthrough continuous monitoring.
5. COMPANY'S WORKING DURING THE CURRENT YEAR 2015-2016 AND THE FUTURE PROSPECTS ALONGWITH REASONS WHILE COMPARING WITH PREVIOUS YEAR RESULTS:
Your Company has exported polished granite slabs and polished monuments valued at Rs.6692 lakhs to U.S.A. during the year under consideration. As regards the Raw Materialsout of the total purchases of Raw Blocks valued at Rs. 1401 lakhs made during the yearabout 17% are imported from Brazil Finland Norway etc.
The year closed on a positive note with export orders on hand to the tune of Rs. 240lakhs as compared to Rs.220 lakhs of last year. In spite of the problems faced by theGranite Industry and the all-round downward economic slide in the International Arenayour company has managed to improve the performance during the current year. Theimprovement is to the extent of about Rs. 528 lakhs.
|Items ||Previous year ||Current year |
|Sales ( Indian ) ||13172230 ||13551589 |
|Sales ( Exports) ||616420612 ||669247661 |
6. CHANGE IN NATURE OF BUSINESS:
During the year the company has not changed its business. However the Shareholdersapproved the resolution by postal Ballot for addition of object(s) relating to generationproduction and storage of solar hydel and all other forms of energy.
7. MATERIAL CHANGES AND COMMITMENTS IF ANY 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:
There are no material changes and commitments that have bearing on the financialposition of the Company.
8. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
There are no significant and material orders by the Regulators or Courts or Tribunalsimpacting the going concern status and company's operations in future.
9. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Management continuously reviews the internal control systems and procedures for theefficient conduct of the company's business. The Company adheres to the prescribedguidelines with respect to the transactions financial reporting and ensure that all itsassets are safeguard and protected against losses. The Internal Auditors of the companyconducts the audit on regular basis and the Audit Committee periodically reviews internalaudit reports and effectiveness of internal control systems.
10. DETAILS OF SUBSIDIARY / JOINT VENTURES/ASSOCIATE COMPANIES
The Company does not have any subsidiaries or Joint Venture or associate companies.
11. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES ASSOCIATES ANDJOINT VENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT.
The company has not accepted any fixed deposits from the public.
13. AUDITORS AND OBSERVATIONS :
M/s Rambabu & Co Chartered Accountants Independent Auditors of the Company wereappointed in the Annual General meeting held on 30th September 2014 for a period of threeyears till conclusion of Twenty Sixth Annual General Meeting. The resolution relating toratification of the appointment is placed before the members in the ensuing Annual GeneralMeeting.
14. SECRETARIAL AUDIT REPORT
Pursuant to provisions of section 204 of the Companies Act 2013 the Company hasappointed Puttaparthi Jagannatham and Co. Company secretaries a firm of companysecretaries to undertake the secretarial audit of the Company. The Secretarial AuditReport obtained is annexed within as Annexure- I
15. EXTRACT OF ANNUAL RETURN :
The extract of the Annual Return is attached as Annexure II
16. SHARE CAPITAL
None of the following issues were taken up during the year and hence details thereofwere not required to be furnished
A) Issue of shares with differential rights B) Issue of sweat equity shares C) Issue ofemployee stock options D) Provision of money by company for purchase of its own shares byemployees or trustees for the benefit of employees.
17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
(A) Conservation of energy
a) Company ensures that the manufacturing operations are conducted in the mannerwhereby optimum utilization and maximum possible savings of energy is achieved.
b) No specific investment has been made on reduction in energy consumption.
c) As the impact of measures taken for conservation and optimum utilization of energyare not quantitative its impact on cost cannot be stated accurately.
d) Details of electricity consumption is as under:
| ||2015-16 ||2014-15 |
|1. Electricity || || |
|a) Purchased Units ||2488779 ||2675162 |
|Total Amount (Rs. in lakhs) ||190.33 ||207.63 |
|Average Cost/Unit (Rs./KWH) ||7.66 ||7.76 |
|b) Own Generation Through Diesel || || |
|Generator Total Units ||107508 ||312960 |
|Total Amount (Rs. in lakhs) ||17.88 ||53.76 |
|Units per liter of Diesel Oil ||3.26 ||3.26 |
|Average Cost/Unit (Rs./KWH) ||16.64 ||17.18 |
(B) Technology Absorption:
No outside technology is being used for manufacturing activities therefore notechnology absorption is required. The Company constantly strives for maintenance andimprovement in quality of its products and entire research and development activities aredirected to achieve the aforesaid goal.
(C) Foreign exchange earnings and outgo
: Details of foreign exchange earnings and outgo are as follows : a) Foreign ExchangeEarnings : Rs. 6692.48Lakhs b) Foreign Exchange Outgo : Rs. 618.99 Lakhs
18. CORPORATE SOCIAL
RESPONSIBILITY AND GOVERNANCE COMMITTEE to Section 135 of the Companies Act 2013 readwith the Companies (Corporate Social Responsibility Policy) Rules 2014 your Company hasconstituted the CSR committee consisting of the following Directors with the roles andresponsibilities duly defined in accordance with the CSR Policy Rules. The committee hasmet once on 30.01.2016 during the financial year ended 31st March 2016.
|Name of the Member ||Designation |
|Shri T.R.C. Bose ||Chairman |
|Shri T.H.Sastry ||Member |
|Shri S. Srinivas ||Member |
The Committee reviewed the CSR Policy and has identified the Education and Environmentas the broad areas towards providing clean and hygienic water and health related areas asthe focus areas for CSR activities.
"The Company allocated an amount of Rs.34.01 lakhs to be spent during the year2015-16 for Corporate Social
Responsibility. However the Company couldn't spend the amount earmarked for CorporateSocial Responsibility due to problem in identifying the better areas and beneficiaries asper its approved CSR Policy. However the amount of Rs.20.65 lakhs was spent by thecompany towards the CSR activities in the field of Education and Environment during theyear 2015-16." The report on CSR activities is attached as Annexure III to thisReport.
19. DIRECTORS AND KEY MANAGERIAL PERSONNEL
A) Changes in Directors and Key managerial personnel:
In accordance with the provisions of Section 197 198 and 203 of the Companies Act2013 and the rules made thereunder and the Articles of Association of the Company ShriN.S.R. Chandra Sekhar Rao who retires by rotation at the forthcoming Annual GeneralMeeting and being eligible has offered himself for reappointment as Director of theCompany.
In the Board Meeting held on 30th October 2015 Ms. Deepa Dutta has been appointed asthe Company Secretary of the Company in terms of Section 203 of Companies Act 2013 readwith Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 witheffect from 01st October 2016.
B) Declaration by the Independent Directors of the Company that they meet the criteriaof independence as provided in Sec 149(6) of the Companies Act 2013.
All the independent Directors have given declarations that they meet the criteria ofindependence as provided in subsection (6) of Section 149 of the
Companies Act 2013 and Regulation 17(b) of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 and that there is nochange in their status of Independence.
C) Formal evaluation statement by the Board of its own performance it's committees andindividual Directors:
Pursuant to the provisions of the Companies Act 2013 and clause 49 of the ListingAgreement the Board has formulated a policy for evaluation of its Board Board CommitteeDirector's and their performances and carried out an evaluation of them. The manner inwhich the evaluation has been carried out has been explained in the Corporate GovernanceReport.
D) Number of meetings of the Board of Directors:
The Directors met for 4 times during period under review. A calendar of meetings isprepared and circulated in advance to all the Directors. The number and details of themeetings of the Board are furnished in the Corporate Governance Report.
E) Meeting of Independent Directors:
A separate meeting of Independent Directors of the Company was held on 30.01.2016 asrequired under Schedule IV to the Companies Act 2013 (Code for Independent Directors) andRegulation 17 of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
At the Meeting the Independent Directors:
l Reviewed the performance of Non-Independent Directors and the Board as a whole;
F) Familiarization Programme for Independent Directors
The Company proactively keeps its Directors informed of the activities of the Companyits management and operations and provides an overall industry perspective as well asissues being faced by the industry. The Familiarisation programme for IndependentDirectors is disclosed on the Company's website.
20. AUDIT COMMITTEE:
The Board of Directors of the Company constituted Audit Committee consisting of thefollowing Directors with the roles and responsibilities duly defined in accordance withthe applicable statutory and other requirements. During the year in all four (4) meetingsof the Committee took place.
|Name of the Member ||Designation |
|Shri T.R.C. Bose ||Chairman |
|Shri T.H.Sastry ||Member |
|Shri N.S.R.C.Sekhara Rao ||Member |
The Board has accepted all the recommendation of the Audit Committee.
21. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES:
The Company at present has the vigil mechanism to deal with the instances of fraud andmismanagement if any. The company ensures that strict confidentiality is maintained whiledealing with the concerns and also that no discrimination is meted out to any person for agenuinely raised concern. It is taken care of by the audit committee of the company.
The Company has also formulated Whistle Blower Policy through which it's DirectorsEmployees and Stake Holders can report their genuine concern about unethical behavioractual or suspended fraud or violation of the company's code of conduct or ethics Policy.
22. CODE OF CONDUCT:
The Board of Directors have approved a code of conduct which is applicable to themembers of the Board and all employees in the course of day to day business operations ofthe Company.
The company believes in "Zero Tolerance" against bribery corruption andunethical dealings / behaviours of any form and the board has laid down the directives tocounter such acts. The code laid down by the Board is known as "Code of BusinessConduct." which forms an appendix to the code. The code lays down the standardprocedure of business conduct which is expected to be followed by the Directors and thedesignated employees in their business dealings and in particular on matters relating tointegrity in the work place in business practices and in dealing with stakeholders . Allthe Board members and senior Management Personnel have confirmed compliance with the code.All management staff were given training in this regard.
23. PREVENTION OF INSIDER TRADING:
Company has adopted a Code of Conduct as per Securities and Exchange Board of India(SEBI) (Prohibition of Insider Trading) Regulations 1992 for prevention of insidertrading with a view to regulate trading in securities by the Directors and designatedemployees of the Company. The code requires pre clearance for dealing in the Company'sshares and prohibits the purchase or sale of Company's shares by the Directors anddesignated employees while in possession of unpublished price sensitive information inrelation to the company and during the period when the trading window is closed. The Boardis responsible for implementation of the code.
During the year under review there has been due compliance with SEBI (Prohibition ofInsider Trading) Regulations 1992.
24. NOMINATION AND REMUNERATION COMMITTEE:
The Board of Directors of the Company has constituted a Nomination and RemunerationCommittee consisting of the following Directors with the role and responsibilities dulydefined and in accordance with the applicable statutory and other requirements.
|Name of Members ||Designation |
|1. Shri T.V.Chowdary ||Chairman |
|2. Shri S. Srinivas ||Member |
|3. Shri N.S.R.C.Sekhara Rao ||Member |
The Board has formulated a policy in consultation with the Nomination and RemunerationCommittee for selection and appointment of Directors Senior management and fixation oftheir remuneration keeping in view the requirements given in section 178 of the companiesAct 2013 and it also involves in the evaluation of` the Board and its remunerationpolicies.
25. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The particulars of every contract or arrangements entered into by the Company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act 2013including certain arms length transactions under third proviso thereto shall be disclosedin Form No.AOC-2 as Annexure-IV to this Report.
There were no materially significant transactions with Related Parties during thefinancial year 2015-16 which were in conflict with the interest of the Company. Suitabledisclosures as required under AS-18 have been made in Note 3.07 of the Notes to thefinancial statements.
26. MANAGERIAL REMUNERATION:
Details of the ratio of the remuneration of each Director to the median employee'sremuneration and other details as required pursuant to Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.
|Remuneration to ||2015-16 ||% on total |
|Directors : ||Rs. ||salaries. |
|(a) N. Hari Hara Prasad Managing Director || || |
|- Salary ||2400000 ||16% |
|- Perquisites ||1453289 || |
|Jaishree Nallapati (Chief Financial Officer) || || |
|- Salary ||600000 ||2% |
b) There is no information required pursuant to Section 197 read with 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as noemployee of the Company is covered by these rules.
c) No Director is in receipt of any commission from the company and the ManagingDirector and Whole-time Director of the Company have not received any remuneration orcommission from any other Company subject to its disclosure by the Company in the Board'sReport.
27. CORPORATE GOVERNANCE
As per Regulation 27 of the Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015 a Report on Corporate Governance formingpart of this Report together with the Auditors' Certificate regarding the compliance ofthe conditions of Corporate Governance is annexed as Annexure - V to this Report.
28. RISK MANAGEMENT AND INSURANCE
Your Company continuously monitors business and operational risk through businessprocess re-engineering and reviewing areas such as production finance legal and otherissues. An exhaustive exercise is underway to bring a model regulating risk managementmechanism. Your Company's assets are adequately insured against the risk from fire andearthquake.
29. DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) ofSection 134 of the Companies Act 2013 shall state that-Directors' ResponsibilityStatement referred to in clause (c) of sub-section (3) of Section 134 of the CompaniesAct 2013 shall state that-
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the Directors had 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 the end of the financial year and ofthe profit and loss of the company for that period;
(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis; and
(e) the Directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively.
(f) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
30 PAYMENT OF LISTING FEE
At present the equity shares of the Company are listed on the Bombay Stock exchange atMumbai. The Company confirms that it has paid Annual Listing Fees due to the Bombay StockExchange for the year 2016-2017.
31. DEPOSITORY SYSTEM
As the Members are aware your Company's shares are tradable compulsorily in electronicform and your Company has established connectivity with Central Depository Services(India) Limited (CDSL). In view of the numerous advantages offered by the depositorysystem the Members are requested to avail the facility of Dematerialization of theCompany's shares on NSDL & CDSL. The ISIN allotted to the Company's Equity shares isINE410G01010.
The company is pursuing the share holders including the promoters holding the sharesin physical form for dematerialization of their shares.
32. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
There are no loans guarantees or investments made under section 186 of the CompaniesAct 2013.
33. MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Management Discussion and Analysis Report as required Regulation 34(3) and 53(f) ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 with stock exchange forms part of this report as AnnexureVI.
34. INTERNAL COMPLAINTS COMMITTEE:
The company has constituted "Internal Complaints Committee" as required undersection 4 (1) of Sexual harassment of women at work place (Prevention Prohibition andRedressal) Act 2013. This committee consists of following members: 1. Smt. JaishreeNallapati 2. Sri S. Srinivas 3. Sri N.S.R.C.Sekhara Rao During the year under review nocomplaints of harassment at the workplace were received by the committee.
Your Directors place on record their appreciation of the financial assistance andsupport extended by State Bank of Mysore. The Directors thank the shareholders for theircontinued confidence and trust placed by them with the Company. The Board also thanks allcategories of employees of the Company for their dedicated and sincere services.
For and on behalf of the Board
|(N.HARI HARA PRASAD) ||(T.H.SASTRY) |
|Managing Director ||Director |
|Place : Hyderabad || |
|Date : 11th May 2016. || |