Your Directors have pleasure in presenting before you the Twenty Third Annual Report ofthe Company together with the Audited Financial Statements for the year ended March 312017.
The highlights of the financial of your company are as under: `in Lakhs
|Particulars ||March 31 2017 ||March 312016 |
|Gross Income ||14885.84 ||13683.72 |
|Profits before depreciation and interest ||2181.24 ||1464.32 |
|Depreciation ||874.18 ||1138.11 |
|Interest ||326.74 ||374.36 |
|Profit before Tax ||980.32 ||(48.15) |
|Net Tax Expense / (credit) ||323.11 ||(51.82) |
|Profit After Tax ||657.21 ||3.67 |
|Balance of Profit brought forward ||1238.11 ||1272.00 |
|Profit available for appropriations ||1895.32 ||1275.67 |
COURSE OF BUSINESS AND OUTLOOK / BUSINESS PERFORMANCE
During the year under review the company had achieved a turnover of ` 149 croreswhich is an increase of approximately 9% on the previous year's turnover of ` 137 crores.The profit before tax at ` 9.8 crores as compared to last year's loss of ` (0.48) Crore.We were able to make significant improvements in key business parameters relating toMargins Costs Working Capital management and Finance Charges. These have helped usimprove profitability and Cash flows. Over the past few years we have made sustainedefforts to improve competitiveness through a number of initiatives. Most of these havereached maturity. The steady improvement over the past few years and the positive resultsduring the year is a result of these initiatives.
Your Directors recommend a dividend of 15 % on the paid up equity share capital of yourCompany for the financial year ended 31st March 2017 (previous year 8%) exclusive ofdividend distribution tax which will result in the out flow of `70.50 lacs.
TRANSFER TO RESERVES:
Your Company does not propose to transfer any amount to the General Reserve during theyear.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 during the saidfinancial year.
We work very closely with our Business associates namely Customers SuppliersDistributors Bankers Service providers and many specialist Consultants. This hasdeveloped into rewarding and close relationships with all of them which helps us inday-to-day operations.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANYBETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT:
There are no material changes and commitments affecting the financial position of theCompany between the end of the financial year and the date of this Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The company has not given any loans or guarantees and made any investments as coveredunder the provisions of section 186 of the Companies Act 2013 during the said financialyear.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The company has an adequate system of internal control in place which has been designedto provide a reasonable assurance with regard to maintaining of proper accountingcontrols monitoring of operations protecting assets from unauthorized use or lossescompliance with regulations and for ensuring reliability of financial reporting.
DIRECTORS / KEY MANAGERIAL PERSONNEL:
In accordance with Section 152 of the Companies Act 2013 and as per the Articles ofAssociation of your Company Dr.Athiya Agarwal Whole Time Director retires by rotationat the ensuing Annual General Meeting and being eligible offers herself for beingre-appointed. The Board recommends for her re-appointment.
During the year under review Mr.S.Ramanujam the Company Secretary superannuated on31st October 2016 The board placed its warm gratitude for the dedicated services renderedby him.
Mrs.Hema Nagarajan was appointed as Company Secretary effective 1st November 2016.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013.
The composition of the Board of Directors of the Company and other details related tothe board is furnished in the Corporate Governance Report annexed to this report.
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 (10) of SEBI(Listing Obligations and Disclosure Requirement Regulations) to the extent applicable theBoard has carried out an evaluation of its own performance the directors individually aswell as the evaluation of the working of its Audit Appointment & RemunerationCommittees. The Directors held separate discussions with each of the Directors of theCompany and obtained their feedback on overall Board effectiveness as well as each of theother Directors.
The Board carries out the annual performance evaluation of its own performance of theDirectors individually as well as the evaluation of working of its various Committees. Astructured analysis is done after taking into consideration the inputs received fromDirectors covering various aspects of the Board's functioning such as adequacy of thecomposition of the Board and its Committees Board culture Execution and Performance ofspecific duties obligations and governance. A separate exercise is carried out toevaluate the performance of individual Directors including the Chairman of the Boardwhoare evaluated on parameters such as level of engagement and contribution independence ofjudgment safeguarding the interests of the Company and of its minority shareholders etc.The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman and the Non-Independent Directors iscarried out by the Independent Directors who also review the performance of theSecretarial Department. The Directors expressed their satisfaction with the evaluationprocess.
A separate meeting of the independent directors was convened which reviewed theperformance of the Board (as a whole) the Non-Independent directors and the Chairman.Post the separate meeting of the Independent Directors collective feedback of each of theIndependent Directors was discussed by the Chairman of the said meeting.
AUDITORS AND AUDITORS' REPORT:
As per Section 139 of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 M/s. Deloitte Haskins & Sells Chartered Accountants (FirmRegistration No. 008072S) were appointed as the statutory auditors of the Company for aperiod of five years at the Annual General Meeting (AGM) of the Company held on 10/09/2015to hold office from the conclusion of the 21st AGM till conclusion of the 26th AGM .As perprovisions of Section 139(1) of the Act their appointment for the above tenure is subjectto ratification by members at every AGM. Accordingly ratification of the members is beingsought for appointment of statutory auditors and fixing of their remuneration as per theproposal setout at item no. 4 of the Notice. The Board commends the Resolution at item No.4 for approval by the Members. The auditor's report is self explanatory.
Pursuant to Section 148 of the Companies Act 2013 read with relevant rules and basedon the Audit Committee the Board of Directors approved the appointment of Mr.P. Raju Iyer(Membership No 6987) as the Cost Auditor of the Company for the Financial Year 2016-17.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as Annexure-I to this report.
PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with The Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 in respect of employees of theCompany are being annexed as part of the Annual Report as Annexure-II to thisreport.
SECRETARIAL AUDIT REPORT:
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Mr. N.K Bhansali Practicing Company Secretary ( Membership No: FCS 3942) toundertake the Secretarial Audit of the Company for the financial year 2016-17. TheSecretarial Audit report is annexed as Annexure- III to this report. There has beenno qualification reservation or adverse remark or disclaimer in their Report.
MANAGEMENT DISCUSSION & ANALYSIS REPORT:
As required under SEBI (Listing Obligations and Disclosure Requirements Regulations)Regulations 2015 the Management Discussion and Analysis Report is annexed as Annexure- IV to this report.
Your Company continues to have an effective Risk Management. The managementcontinuously oversees the risk management process including identification impactassessment and drawing mitigation plans. The details of risks perceived by the Managementare annexed as part of the Management Discussion and Analysis Report.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS OF THE COMPANY:
There are no significant and material orders passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDEXPENDITURE:
The Company is exploring new technologies and improving the existing technologiesapplicable to the Hospital Business. In all its new locations the company has been usingLED technology lamps to conserve energy as well as costs.
FOREIGN EXCHANGE EARNINGS / OUTGO:
Foreign Earnings : `6.53 lakhs (Previous Year ` Nil) on account of services rendered.
Foreign Outgo : `264.24 lakhs (Previous Year ` 168.17 lakhs) towards Purchase ofConsumables.
DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134 clause (C) of sub-section (3) of the Companies Act 2013 theDirectors would like to state that: (i) In the preparation of the annual accounts theapplicable accounting standards have been followed.
(ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 or loss of the Company for the year under review.
(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 on a going concern basis.
(v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(vi) The directors had devised proper system to ensure compliance with the provisionsof all applicable laws and that such system were adequate and operating effectively.
Vigil Mechanism / Whistle Blower Mechanism
The Company has a vigil mechanism to deal with instances of fraud and mismanagement ifany. The details of the Policy is posted on the website of the Company.
Corporate Social Responsibility (CSR) Committee
The Company has constituted CSR Committee and following are the members:-a Dr. AthiyaAgarwal- Chairperson b CA Sanjay Anand- Member c Dr. Adil Agarwal- Member d Dr. AnoshAgarwal- Member
The CSR policy pursuant to the provisions of Section 135 of the Companies Act 2013 isavailable in your company's website www.dragarwal.com. Your Company has incurredexpenditure amounting to ` 5.70 lakhs by way of contribution to National Prime Minister'sRelief fund towards CSR responsibilities.
The Company's total spending on CSR is 2% of the average net profit for the immediatelypreceding three financial years. The report on CSR activities is given in Annexure Vforming part of this Report.
Report on Corporate Governance
A report on Corporate Governance as well as a certificate from a Practicing CompanySecretary confirming the compliance with the conditions of the Corporate Governance areannexed as Annexure - VI to this Report.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. An Internal Complaints Committee (ICC) has been setup by yourCompany to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy. The followingis a summary of sexual harassment complaints received and disposed off during the year2016-17 a. No. of complaints received : Nil b. No of complaints disposed off : NA
Employee relations throughout the company were harmonious. The board wishes to place onrecord its sincere appreciation of the devoted efforts of all employees in advancing thecompany's vision and strategy to deliver another record performance.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with PromotersDirectors Key Managerial Personnel or other designated persons which may have potentialconflict with interest of the company at large. The Board of Directors of the Company hason the recommendation of the Audit Committee adopted a policy to regulate transactionsbetween the Company and its Related Parties in compliance with the applicable provisionsof the Companies Act 2013 and the Rules there under. This policy was considered andapproved by the Board has been uploaded on the website at www.dragarwal.com
Your directors wish to place on record their appreciation for the continuous supportreceived from the members customers suppliers various statutory bodies of theGovernment of India and the company's employees at all levels.
For and on behalf of the Board Sd/-
DR AMAR AGARWAL
Chairman Cum Managing Director
Date: May 23 2017