Your Directors have pleasure in presenting their 28 (Twenty Eighth) Annual Report onthe business and operations of the Company and the Audited Accounts for the Financial Yearended 31 March 2017
1) FINANCIAL SUMMARY / HIGHLIGHTS OF PERFORMANCE OF THE COMPANY :
|Financial Results || ||[ Rs. in Lacs] |
|Particulars ||Year Ended ||Year Ended |
| ||31-03-2017 ||31-03-2016 |
|Total Revenue ||4642.05 ||3808.14 |
|Profit before Depreciation and Tax ||342.00 ||293.96 |
|Depreciation ||86.09 ||87.90 |
|Profit (Loss) before Tax ||255.91 ||206.06 |
|Less : Tax Expenses ||78.14 ||77.83 |
|Net Profit (Loss) for the year ||177.77 ||128.23 |
2. PERFORMANCE :
During the year under review the Company has earned higher profit compared to theprevious year. The situation of heavy pressure on margin continued in the year. TotalRevenue stood at Rs. 4642.05 Lacs from Rs. 3808.14 Lacs i.e. increase of 21.90% in thetotal revenue of the Company as compared to previous year and due to increase in totalrevenue the Net Profit for the year under review increased from Rs. 128.23 Lacs to Rs.177.77 resulting in increase of about 38.63% of Net Profit of the Company. But overallPerformance of the Company was satisfactory as compared to the peers of the Company.
Further the Company continues with its efforts to maintain growth even during theeconomic downturn and face new challenges.
Your directors are pleased to recommend the dividend @ 10% ( Rs. 1.00/- per equityshare) on equity shares of Rs. 10.00 each for the year ended 31st March 2017. The totaldividend pay-out excluding dividend distribution tax shall be Rs. 30.29 Lacs.
4. SHARE CAPITAL:
At present the Company has only one class of shares equity shares with facevalue of Rs. 10.00 each. The authorized share capital of the company is Rs. 350.00 Lacsdivided into 3500000 equity shares of Rs. 10.00 each. The paid up share capital of thecompany is Rs. 302.85 Lacs divided into 3028500 equity shares of Rs. 10.00 each.
During the year under review the Company has not issued shares with differentialvoting rights nor granted stock options nor sweat equity.
The Board has transferred Rs. 17.10 Lacs from Revaluation Reserve to General ReserveAccount for the Financial Year ended on 31st March 2017 as per requirement of Schedule IIto Companies Act 2013. Further amount of Rs. 6.50 Lacs set aside as reserve foreco-development is transferred to general reserve as the same is not obligatory now as peropinion of pollution control consultant.
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.
7. FUTURE OUTLOOK:
The Company expects the market for chemicals and dyes to grow moderately. Company istaking effective steps to improve operational efficiency to maintain the earnings. AtPresent many policies are being formed/adopted by the present Government which may bebeneficial to the Company in future. As crude oil prices fluctuating frequently havedirectly impact on the economy and in same line we expect many more positive things tohappen in the global market which may have positive impact on the Company.
India's stable macroeconomic environment and strong growth outlook stand out relativeto other emerging markets. Growth in 2015-16 was 7.6 % substantially higher than 7.3 % in2014-15.
With India's ever growing requirements of energy and capacity addition planned by theGovernment through various initiatives though demand is subdued at the moment thereexists substantial opportunity for future growth as the Company's products are geared upfor the requirements.
8. UNCLAIMED DIVIDEND:
As on 31st March 2017 dividend amounting to Rs. 2.88 Lacs has not been claimed byshareholders of the Company. Shareholders are required to lodge their claims with theRegistrar Link Intime India Pvt. Ltd. for unclaimed dividend. Pursuant to the provisionsof Investor Education and Protection Fund (Uploading of Information regarding unpaid andunclaimed amounts lying with Companies) rules 2012 the Company has uploaded the detailsof unpaid and unclaimed amounts lying with the Company on 13th August 2016 (date of thelast Annual General Meeting) on the website of the Company (www.dynaind.com) as also onthe website of the Ministry of Corporate Affairs (www.mca.gov.in).
9. ENERGY TECHNOLOGY AND FOREIGN EXCHANGE:
In accordance with the provisions of Clause (m) of Sub Section (3) of Section 134 theCompanies Act 2013 read with Companies (Accounts) Rules 2014 the relevant informationpertaining to conservation of energy technology absorption foreign exchange earnings andoutgo is given in ANNEXURE - I and forms part of this report.
10. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There were no such material changes occurred subsequent to the close of the financialyear of the Company to which the balance sheet relates and the date of the report whichcan affect the financial position of the Company.
11. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS:
No such Orders have been passed by the Regulators/Court or Tribunals which can impactthe going concern status and Company's operation in future.
12. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES:
The Company has a Wholly Owned Subsidiary Company Named Neo Farbe Private Limited (CIN:U24100GJ2013PTC073930). Details relating to Subsidiary Company are provided in AOC-1 thestatement also provide the details of performance and financial positions of Subsidiary.
13. PARTICULARS OF LOANS GUARANTEES OR INVESTMENT BY THE COMPANY:
Details of Loans Guarantees and Investments if any covered under the provisions ofSection 186 of the Act are given in the notes to the Financial Statements.
14. MEETING OF BOARD OF DIRECTORS:
During the year under the review 7 (Seven) Board Meetings were held with gap notexceeding the period prescribed under Companies Act 2013 and Rules made thereunder.Details of Board and Board Committee Meetings held during the year are given in theCorporate Governance Report.
Board meeting dates are finalized in consultation with all Directors and agenda papersbacked up by comprehensive notes and detailed background information are circulated wellin advance before the date of the meeting thereby enabling the Board to take informeddecisions. The intervening gap between the Board Meetings was within the period prescribedunder the Companies Act 2013.
15. EXTRACTS OF ANNUAL RETURN:
An extract of Annual Return in Form MGT-9 is attached herewith as ANNEXURE-II.
All the Properties of the Company are adequately insured.
17. RELATED PARTY TRANSACTIONS:
There were no materially significant related party transactions entered between theCompany Directors management or their relatives except for those disclosed in thefinancial statements.
All the contracts/arrangements/transactions entered into by the Company with therelated parties during the financial year 2016-17 were in the ordinary course of businessand on an arm's length basis.
Accordingly particulars of contracts or arrangements with related parties referred toin Section 188(1) along with the justification for entering into such contract orarrangement in Form AOC-2 does not form a part of this report.
The Audit Committee has granted omnibus approval for Related Party Transactions as perthe provisions and restrictions contained in the Listing Agreement.
The company has formulated a policy on "Materiality of Related Party transactionsand on dealing with Related Party Transactions ' ' and the same is on the company's w e bs i t e a thttp://www.dynaind.com/investor_zone/Policies/Related%20Party%20Transaction%20Policy.pdf
The details of related party disclosure form a part of the notes to the financialstatements provided in the annual report.
18. DIRECTORATE AND KEY MANAGERIAL PERSONNEL:
The Board of Directors of your company has various executive and non-executivedirectors including Independent Directors who have wide and varied experience in differentdisciplines of corporate functioning.
In accordance with the provisions of Section 152 of the Companies Act 2013 andArticles of Association of the Company Mr. Dinesh Jasraj Jain(DIN: 00135889) retires byrotation at the ensuing Annual General Meeting and being eligible in terms of Section 164of the Act offers himself for re-appointment.
The Company had pursuant to the provisions of Regulation 17 read with Regulation 25 ofSEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 entered intowith Stock Exchange appointed Mr. Jatinbhai Biharilal Surti (DIN: 05195572) Mr.Pravinchandra Devidas Master (DIN: 05195587) Mr. Raghavdas Hiralal Lakhmani (DIN:05304347) & Ms. Viraj Darshit Shah (DIN: 07220630) as an Independent Directors of theCompany.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation25 of SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015.
There were no changes in the constitution of Board of Directors or Key ManagerialPersonnel during the year.
As required under Section 203 of the Companies Act 2013 the Company has Mr.Dipakkumar Navinchandra Choksi as Managing Director Mr. Harin Dhanvantlal Mamlatdarna asWhole-time Director Mr. Dinesh Jasraj Jain as Whole-time Director Mr. Punit LeelaramChhattani as Chief Financial Officer and Mr. Harsh Rameshbhai Hirpara as CompanySecretary under Key Managerial Personnel of the Company.
Remuneration to Key Managerial Personnel Senior Management and other employees willinvolve a balance between fixed and incentive pay reflecting short and long-termperformance objectives of the employees in line with the working of the Company and itsgoals.
19. EVALUATION OF BOARD COMMITTEES AND DIRECTORS:
In compliance with the Companies Act 2013 and Regulation 17(10) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the performance evaluation ofthe Board was carried out during the year under review. More details on the same are givenin the Corporate Governance Report.
20. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS:
The Board has on the recommendation of the Nomination & Remuneration Committeeformulated criteria for determining Qualifications Positive Attributes and Independenceof a Director and also a Policy for remuneration of Directors Key managerial Personneland senior management.
21. MANAGERIAL REMUNERATION
Details of remuneration paid / payable to the Directors for Financial Year 2016-2017
[ Rs. in Lacs]
|Name ||Salary and Perquisites F.Y. 2016-17 ||Commission ||Shares issued under ESOP ||Details of Service contracts; notice period and severance fees |
|Dipakkumar N. Choksi ||27.13 ||Nil ||Nil ||Special Resolution d t . 14-08-2015 valid up to 3 0 - 0 9 - 2 0 1 7 ; n o N o t i c e period and no severance fees |
|Harin D. Mamlatdarna ||27.17 ||Nil ||Nil || |
|Dinesh J. Jain ||10.43 ||Nil ||Nil || |
The statement containing particulars of employees as required under Section 197 (12) ofthe Companies Act 2013 read with Rule 5 (2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 forms part of this Report as Annexure -III.
22. INDEPENDENT DIRECTORS' DECLARATION:
The Company has received the necessary declaration from each Independent Director inaccordance with Section 149(7) of the Companies Act 2013 that he/she met the criteria ofindependence as laid out in sub-section (6) of Section 149 of the Companies Act 2013 andthe Regulation 16(1)(B) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
23. COMMITTEES OF THE BOARD:
During the year in accordance with the Companies Act 2013 the Board re-constitutedsome of its Committees.
There are currently four Committees of the Board as follows:
1. Audit Committee
2. Corporate Social Responsibility Committee
3. Nomination and Remuneration Committee
4. Stakeholders' Relationship Committee
Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the "Report on Corporate Governance" a part ofthis Annual Report.
A. Statutory Auditors
Under Section 139 of the Companies Act 2013 and the Rules made thereunder it ismandatory to rotate the statutory auditors on completion of the maximum term permittedunder the said section. The audit committee of the Company has proposed and on 30th May2017 the Board of Directors of the Company has recommended the appointment of Ashok K.Bhatt & Co. Chartered Accountants (Firm registration number 100657W) as the statutoryauditors of the Company. Firm will hold office for a period of five consecutive years fromthe conclusion of the 28th Annual General Meeting of the Company scheduled to be held on14th August 2017 till the conclusion of the 33rd Annual General Meeting to be held inthe year 2022 subject to the approval of the shareholders of the Company. The first yearof audit will be of the financial statements for the year ending March 31 2018 which willinclude the quarterly financial statements for the year.
The Company has obtained a written confirmation under section 139 of the Companies Act2013 from Ashok K. Bhatt & Co. Chartered Accountants Ahmedabad (FRN 100657W) thattheir appointment if made would be in conformity with the limits specified under theAct.
It is proposed to appoint Ashok K. Bhatt & Co. Chartered Accountants Ahmedabad(FRN 100657W) to audit the accounts of the Company for the financial year 2017-2018.
Further the Audit Report for the financial year end 31st March 2017 is given by thecurrent auditors of the Company i.e. M/S. G.K. Choksi & Co. Chartered Accountants.
The Report given by the Auditors on the financial statements year ended March 2017 ofthe Company is part of the Annual Report. The notes to the accounts referred to in theAuditors' Report are self-explanatory and therefore do not call for any further comments.
There has been no qualification reservation adverse remark or disclaimer given by theAuditors in their Report.
B. Secretarial Auditors
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed Mr. Chetan R.Shah Practicing Company Secretaries Ahmedabad to undertake the Secretarial Audit of theCompany. The Secretarial Audit Report is annexed herewith as Annexure IV
There is no qualification reservation or adverse remark in the report
25. INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORK:
The Company has an Internal Control System commensurate with size scale andcomplexity of its operations. The internal financial controls are adequate and areoperating effectively to ensure orderly and efficient conduct of business operations. TheCompany has appointed M/s. VKJD & Associates Chartered Accountant vide (FRN 128985W)as an Internal Auditors of the Company. The Audit Committee in consultation with theinternal auditors formulates the scope functioning periodicity and methodology forconducting the internal audit. The internal auditors carry out audit covering inter aliamonitoring and evaluating the efficiency & adequacy of internal control systems in theCompany its compliance with operating systems accounting procedures and policies at alllocations and submit their periodical internal audit reports to the Audit Committee. Basedon the internal audit report and review by the Audit committee process owners undertakenecessary actions in their respective areas. The internal auditors have expressed that theinternal control system in the Company is robust and effective. The Board has also put inplace requisite legal compliance framework to ensure compliance of all the applicable lawsand that such systems are adequate and operating effectively.
26. RISK MANAGEMENT :
Company has implemented an integrated risk management approach through which it reviewsand assesses significant risks on a regular basis to help ensure that there is a robustsystem of risk controls and mitigation in place. Senior management periodically reviewsthis risk management framework to keep updated and address emerging challenges. Majorrisks identified for the Company by the management are Currency fluctuation Compliancesof various applicable Laws Regulatory changes Manufacturing & Supply LitigationTechnological Changes and new capital investments return. The management is however ofthe view that none of the above risks may threaten the existence of the Company as robustRisk mitigation mechanism is put in place to ensure that there is nil or minimum impact onthe Company in case any of these risks materialize.
27. VIGIL MECHANISM AND WHISTLE BLOWER POLICY:
In accordance with Section 177 of the Companies Act 2013 and Regulation 22 of SEBI(Listing Obligations and Disclosures Requirements) Regulations 2015 the Company hasconstituted a Whistle Blower Policy/ Vigil Mechanism to establish a vigil mechanism forthe directors and employees to report genuine concerns in such manner as may be prescribedand to report to the management instances of unethical behavior actual or suspected fraudor violation of the Company's code of conduct.
The detail of the Whistle Blower Policy is explained in the Corporate GovernanceReport.
None of the Non-Executive Directors has any pecuniary relationship or transactions withthe Company other than sitting fees payable to them.
28. CORPORATE SOCIAL RESPONSIBILITY (CSR):
Pursuant to the provisions of section 135 of the Act read with CSR Rules the Companyhas constituted CSR committee and formulated CSR policy. The Policy primarily rests onfour broad categories: Environment Health Education and Community Development.
The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy)Rules 2014 are made and the same is enclosed as Annexure-V
29. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:
As per the requirement of The Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (Act') and Rules made thereunder yourCompany has assigned the responsibilities to Audit Committee. During the year nocomplaint with allegations of sexual harassment was filed against the Company.
30. PREVENTION OF INSIDER TRADING:
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading Window is closed. The Board is responsible forimplementation of the Code. All Board Directors and the designated employees haveconfirmed compliance with the Code.
31. DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of clause (c) of sub-section (3) of Section 134 ofthe Companies Act 2013 and to the best of their knowledge and belief and according to theinformation and explanations obtained by them your Directors state that-
i. In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
ii. 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 31stMarch 2017 and of the profit and loss of the company for that period;
iii. The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 and Rules madethereunder for safeguarding the assets of the company and for preventing and detectingfraud and other irregularities;
iv. The directors had prepared the annual accounts on a going concern basis; and
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 systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
32. CORPORATE GOVERNANCE:
As required by the Regulation 27 of SEBI (Listing Obligations and DisclosuresRequirements) Regulations 2015 entered into with the Stock Exchanges a detailed reporton Corporate Governance is given as a part of the Annual Report. The Company is in fullcompliance with the requirements and disclosures that have to be made in this regard. TheAuditors' Certificate of the compliance with Corporate Governance requirements by theCompany is attached to the Report on Corporate Governance. Report on Corporate Governanceis given elsewhere in this Annual Report herewith attached as ANNEXURE VI.
33. CORPORATE GOVERNANCE CERTIFICATE:
The Compliance certificate from the auditors regarding compliance of conditions ofCorporate Governance as stipulated in Regulation 27 of SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 is appended to the report on CorporateGovernance. herewith attached as Annexure VII.
34. RELATED PARTY DISCLOSURE:
Related Party discloser as mentioned in Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is appended to the report of Director herewithattached as Annexure VIII.
35. GENERAL SHAREHOLDER INFORMATION:
General Shareholder Information is given in Report on Corporate Governance forming partof the Annual Report.
Your Directors take this opportunity to express their gratitude for the unstintedcommitment dedication hard work and significant contribution made by employees at alllevels in ensuring sustained growth of the Company. Your Directors also sincerely thankall the stakeholders customers vendors bankers business associates government otherstatutory bodies and look forward to their continued assistance co-operation and support.
| ||By Order of the Board |
| ||-Sd/- |
|Place : Ahmedabad ||DIPAKKUMAR CHOKSI |
|Date : 30 May 2017 ||Vice Chairman & Managing Director |
| ||DIN : 00536345 |