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Euro India Fresh Foods Ltd.

BSE: 538412 Sector: Agri and agri inputs
NSE: EIFFL ISIN Code: INE546V01010
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Euro India Fresh Foods Ltd. (EIFFL) - Director Report

Company director report

To

The Shareholders

Euro India Fresh Foods Limited.

Your directors have pleasure to present their 8th Annual Report along withthe Audited Statement of Accounts for the year ended on 31st March 2017.

1. FINANCIAL RESULTS

(Rs. In Lakhs)
Particulars For the year Ended 31/03/2017 For the year Ended 31/03/2016
Revenue from Operation 4804.64 4745.64
Other Income 170.19 10.40
Total Revenue 4974.83 4756.04
Less: Total Expenses (Including Depreciation) 4827.00 4706.65
Profit before Exceptional Items and tax 147.83 49.39
Less: Exceptional Items 77.35 0
Profit Before Taxation 70.48 49.39
Less: Income Tax 18.19 9.68
Less: MAT Credit Availed -18.19 -9.67
Less: Deferred Tax -65.81 47.40
Profit after Taxation 136.29 1.98
Earnings Per Share (Basic and Diluted) 0.68 0.01

2. PERFORMANCE OF THE COMPANY

During the year under preview the Company has earned sales Income Rs.4804.64 Lakh(Previous Year Rs.4745.64 Lakh) and other Income Rs.170.19 Lakh (Previous year Rs.10.40Lakh). The Total revenue Rs. 4974.83 Lakh (Previous year Rs. 4756.04 Lakh).

Profit before Tax was review Rs. 70.48 Lakh (Profit after Tax (PAT) was review Rs.136.29 Lakh (Previous year Rs. 1.98 Lakh).

3. DIVIDEND

In the context to financial expansion and Future Growth's perspective of the Companyand Stakeholders the Managing Director and other directors do not recommend the dividendfor the Financial Year 2016-17.

4. IPO PROCEEDS AND DEPLOYMENT OF FUNDS:

Your Company has successfully come into the market with an Initial Public Offering(IPO) with allotment of 4800000 Fresh Equity Shares and 1771200 Offer for Sale on 28thMarch 2017 and has listed on NSE SME EMRGE platform on 31st March 2017.

The issue size was Rs. 512553600 (Rupees Fifty One Crore Twenty Five Lakh FiftyThree Thousand Six Hundred Only) consisting of 6571200 Equity Shares of Rs. 78/- pershare (Face value of Rs. 10/- per share and premium of Rs. 68/- per share). The issue wasopened on 21st March 2017 and closed on 24th March 2017.

The Company raised fund through IPO and for the said matter as per Regulation 32(4) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and otherapplicable Provisions if any the company shall furnish the explanation below:

PARTICULARS AMOUNT ALLOTTED FOR OBJECT AS DISCLOSED IN PROSPECTUS UTILIZATION OF FUND RECEIVED FROM ALLOTMENT OF SHARES TILL JULY 31 2017 BALANCE AMOUNT TO BE UTILIZED DEVIATION OR VARIATION (IF ANY)
Repayment of Certain unsecured Loans Availed by us 1777.49 1777.49 0.00 0.00
Working Capital Requirement 1000.00 1066.24 0.00 66.24
General Corporate Purposes 856.94 790.70 0.00 (66.24)
Total 3634.43 3634.43 0.00 0.00

The IPO Proceeds were fully utilized and the same has been intimated to the StockExchange wide letter dated 24th August 2017 under Regulation 32 of SEBI(Listing Obligation and Disclosure Requirements) Regulation 2015. The deviations in theutilization of proceeds were adjusted among various heads internally.

5. MATERIAL CHANGES

On 31st March 2017 the Company takes a biggest step and came out with anIPO of Rs. 5125.54 Lakh in which company offers to public 6571200 Equity Shares of Rs.78/- per Equity Shares including the premium of Rs. 68/- per Equity Shares i.e face valueof Rs. 10/- per Equity Shares. The Public Offer includes of a Fresh offer of 4800000Equity Shares and Offer for Sale of 1771200 Equity Shares. The IPO successfully achievedthe milestone and got listed on NSE Emerge Platform.

In Addition to the Material Changes the Company appointed Karvy Computershare PrivateLimited as a Registrar and Share transfer agent of the Company.

6. SHARE CAPITAL

The Paid up Equity Share Capital of the Company as on March 31 2017 was Rs. 24.80Crores. There has been change of 4800000 Equity shares with face value of Rs. 10/- perequity share and premium of Rs. 68/- per equity share of the Company during the year asthe way of Initial Public Offering (IPO).

During the year except above the company has not issued any shares like Sweat EquityBonus Shares Employee stock option and the company did not buy-back of their securities.

7. EXTRACT OF ANNUAL RETURN

An Extract of the Annual Return as of 31st March 2017 pursuant to the sub-section (3)of Section 92 of the Companies Act 2013 and Rule 12 of the companies (Management andAdministration) Rules 2014 in Form MGT 9 is annexed as "Annexure A".

8. DETAILS OF BOARD OF DIRECTORS

The Board of Directors Comprises of Eight (8) Directors including of One (1) WomenDirector. The Chairperson of the Board is an Executive Director. The Composition of theBoard is as below:

NAME DESIGNATION CATEGORY
Mr. Manharbhai Jivanbhai Sanspara Chairman and Managing Director Executive Director
Mr. Dinesh Jivanbhai Sanspara Joint Managing Director Executive Director
Mr. Maheshkumar Vallabhbhai Mavani Director Executive Director
Mrs. Maya Dinesh Sanspara Additional Director Non-Executive Director
Mr. Ghanshyam Arjan Patel Additional Director Independent Director
Mr. Parth Vallabhbhai Saspara Additional Director Independent Director
Mr. Snehal Manjibhai Patel Additional Director Independent Director
Mr. Paresh Bhupatbhai Lathiya Additional Director Independent Director

During the year Company appointed Mrs. Maya Dinesh Sanspara as Additional DirectorMr. Ghanshyam Arjan Patel Mr. Parth Vallabhbhai Saspara Mr. Snehal Manjibhai Patel andMr. Paresh Bhupatbhai Lathiya as Additional Independent Directors with effect from 9thSeptember 2016 of the Company and subject to regularize in the said Annual GeneralMeeting.

9. DETAILS OF KEY MANGERIAL PERSONNEL

The Key Managerial Personnel's (KMPs) of the Company in accordance with the provisionsof Section 2(51) and

Section 203 of the Companies Act 2013 read with Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 (including any statutory modification(s)or re-enactment(s) for the time being in force) are as follows:

NAME DESIGNATION
Mr. Manharbhai Jivanbhai Sanspara Chairman and Managing Director
Mr. Dinesh Jivanbhai Sanspara Joint Managing Director
Dr. Mukesh Ambabhai Navadia Chief Executive Officer
Ms. Nikki Ketan Shah Company Secretary and Compliance Officer
Mr. Shailesh Madhubhai Sardhara Chief Financial Officer

During the year Company appointed Dr. Mukesh Ambabhai Navadia as Chief ExecutiveOfficer Miss. Nikki Ketan Shah as Company Secretary and Compliance Officer and Mr.Shailesh Madhubhai Sardhara as Chief Financial Officer with effect from 9thSeptember 2016 as Key Managerial Personnel of the Company.

10. MEETINGS OF THE COMPANY'S BOARD OF DIRECTOR'S

During the financial year 2016-17 Fourteen (14) Board Meetings were held. The detailsare as below:

Sr. No. Date of Meeting Board's Strength No. of Director's Present
1. 12.04.2016 3 3
2. 30.06.2016 3 3
3. 25.07.2016 3 3
4. 22.08.2016 3 3
5. 29.08.2016 3 3
6. 07.09.2016 3 3
7. 09.09.2016 3 3
8. 14.09.2016 8 8
9. 28.10.2016 8 8
10. 25.11.2016 8 8
11. 23.01.2017 8 8
12. 14.03.2017 8 8
13. 29.03.2017 8 8
14. 30.03.2017 8 7

11. NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR

During the Financial Year ended March 31 2017 no entity became or ceased to be thesubsidiary joint venture or associate of the Company.

12. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions under Section 134(5) of the Companies Act 2013 withrespect to Directors Responsibility Statement the Directors confirm:

(a) that in the preparation of the Annual Accounts for the year ended March 31 2017the applicable Accounting standards have been followed and that there are no materialdepartures;

(b) that appropriate accounting policies have been selected and applied consistentlyand judgments and estimates that are reasonable and prudent have been made so as to give atrue and fair view of the state of affairs as at March 31 2017 and of the profit of theCompany for the Financial year ended March 31 2017;

(c) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

(d) that the annual accounts for the year ended March 31 2017 have been prepared on agoing concern basis;

(e) that they had laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and were operating effectively; and

(f) that they had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

13. DECLARATION BY INDEPENDENT DIRECTOR(S) AND RE-APPOINTMENT IF ANY

All Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013read with SEBI Listing Regulations so as to qualify themselves to be appointed asIndependent Directors under the provisions of the Companies Act 2013 and SEBI ListingRegulations.

14. POLICY ON DIRETOR'S APPOINTMENT AND REMUNERATION

The Company's policy on Director's appointment and remuneration and other mattersprovided in Section 178 of the Companies Act 2013 has been disclosed in the CorporateGovernance Report.

15. STATUTORY AUDITOR

The Board proposes for the appointment of M/s JN & shah & CO CharteredAccountants having firm registration no. 118020W as a Statutory Auditors of the Companyfor the period of five years starting from the conclusion of 8th Annual GeneralMeeting till the conclusion of 13th Annual General meeting subject toratification at every Annual General Meeting at such remuneration as may be decided by theBoard from time to time. The Company has received letter from the auditors that theirappointment if made would be within the prescribed limits under section 139(2) of theCompanies Act 2013 and that they are not disqualified for such appointment under section141 of the Companies.

16. DEPOSITS

During the year your company has not accepted any deposits under section 73 of thecompanies Act 2013 and therefore not required to furnish information as per Rule 8(5) (V)and (vi) of the Companies (Accounts) Rules 2014.

17. LOANS GUARANTEE OR INVESTMENTS UNDER SECTION 186

There are no loans and investments as per section 186 of the companies Act 2013 hencenot applicable.

18. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

With reference to section 134(3) (h) of the Companies Act 2013 all contracts andarrangements with related parties under section 188 of the Companies Act 2013 entered bythe company during the financial year were in ordinary course of business and at arm'slength basis. Details of the related party transactions made during the year are annexedbelow as "Annexure-B" in form AOC-2.

The Company has also adopted a Related Party Transactions Policy. The Policy wasapproved by the Board and the same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Related-Party-Transaction-Policy.pdf

19. CONVERSATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREGIN EXCHANGE EARNING ANDOUTGO

The information relates to the conversation of energy Technology absorption andforeign exchange earnings and outgo as per provision under Section 134(3) (m) of theCompanies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is annexedbelow as "Annexure-C".

20. CORPORATE SOCIAL RESPONSIBILITY

The Company has not developed and implemented any Corporate Social Responsibilityinitiatives and Corporate Social Responsibility Committee as per section 135 of theCompanies Act 2013 as the said provision are not applicable.

21. MANAGEMENT DISUCUSSION AND ANALYSIS REPORT

As per Regulation 34 of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 the Management Discussion and Analysis Report is annexed as "Annexure- D".

22. CORPORATE GOVERANCE

Your Company has listed on NSE Emerge Platform since 31st March 2017 asper the provision of Regulation 15(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the company was not came under the ambit of the saidregulation and it is not mandatory for the SME Listed companies to comply with theprovisions of the Regulation 27 (2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.The Company prepared the Corporate Governance report forthe Investor's for their convince and thorouly knowledge about the company the same isannexed as "Annexure - E".

23. RISK MANAGEMENT

Risk is in itself sound as a huge responsibility for the organization to identifyevaluate access formulate and reduce it. It is the internal as well as external part ofthe Organization Risk factor works in the day to day operations of the Company. There aredifferent kinds of Risk to evaluate and reduce i.e Market risk Liquidity Risk OperationRisk Management Risk Interest rate risk etc. The Company has taken necessary steps toovercome the Risk factor and helps the organization to run smoothly.

The Company has also adopted a Risk Management Policy. The Policy was approved by theBoard and the same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Risk-Management-Policy.pdf

24. AUDIT COMMITTEE

Your Company has constituted an Audit Committee ("Audit Committee") as persection 177 of the Companies Act 2013 and Regulation 18 of SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 vide resolution passed at the meeting of Boardof Directors held on 9th September 2016.

Composition of Audit Committee:

Name of Director Status in Committee Nature in Directorship
Parth Vallabhbhai Saspara Chairman Independent Director
Paresh Bhupatbhai Lathiya Member Independent Director
Maheshkumar Vallabhbhai Mavani Member Executive Director

Meeting Held and attended during the year:

Sr. No. Date of Meeting Committee Strength No. of Members Present
1 09/09/2016 3 3
2. 25/11/2016 3 3
3. 30/03/2017 3 3

25. NOMINATION AND REMUNERATION COMMITTEE

Your Company has constituted a Nomination and Remuneration Committee as per section178 of the Companies Act 2013 and Regulation 19 of SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 vide resolution passed at the meeting of Boardof Directors held on 9th September 2016.

Composition of Nomination and Remuneration Committee:

Name of Director Status in Committee Nature in Directorship
Ghanshyam Arjun Patel Chairman Independent Director
Snehal Manjibhai Patel Member Independent Director
Paresh Bhupatbhai Lathiya Member Independent Director

Meeting Held and attended during the year:

Sr. No. Date of Meeting Committee Strength No. of Members Present
1 09/09/2016 3 3
2. 30/03/2017 3 3

26. STAKEHOLDERS AND INVESTOR GRIVENCES COMMITTEE

Your Company has constituted a Stakeholder and Investor Grivence Committee as persection 178 of the Companies Act 2013 and Regulation 20 of SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 vide resolution passed at the meeting of Boardof Directors held on 9th September 2016.

Composition of Nomination and Remuneration Committee:

Name of Director Status in Committee Nature in Directorship
Paresh Bhupatbhai Lathiya Chairman Independent Director
Ghanshyam Arjun Patel Member Independent Director
Maheshkumar Vallabhbhai Mavani Member Executive Director

Meeting Held and attended during the year:

Sr. No. Date of Meeting Committee Strength No. of Members Present
1 09/09/2016 3 3
2. 30/03/2017 3 3

27. VIGIL MECHANISM

Your Company has established a vigil mechanism as pursuant Section 177(9) of CompaniesAct 2013 and Regulation 22 of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 to tackle the circumstances occurred in the organization such as fraudmisrepresentation etc. The vigil mechanism shall provide for adequate safeguards againstvictimization of Director(s) or employee(s) or any other person who avail the mechanismand also provide for direct access to the chairperson of the audit committee.

The Company has also adopted a Vigil Mechanism/ Whistle Blower Policy. The Policy wasapproved by the Board and same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Vigil-Mechanism-Whistle-Blower-Policy.pdf

28. BOARD EVUATION

Your Company evaluates the board in the different committee pursuant to the provisionof the Companies Act 2013 and the Regulation 17(10) of SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 The board has carried out an annualperformance evaluation of its own performances. The Company delegates the responsibilitiesin the committee formulated by the company such as Audit Committee nomination andremuneration Committee and Stakeholder Grievance Commiittee.

The Company has also adopted a Performance Evaluation Policy. The Policy was approvedby the Board and same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Performance-Evaluation-Policy.pdf

29. REMUNERATION POLICY

The Remuneration paid to the Executive directors of the Company is recommended by theNomination and Remuneration Committee of the Company and then the Board of the companyapprove in their duly held meeting. The remuneration of executive directors are decided byconsidering various criteria like Qualification experience responsibilities valueaddition to the company and financial position of the company. Board is taking permissionof the members if required at any time for paying remuneration to executive directors.

Company is not paying any remuneration to non-executive and independent directors ofthe company.

The Company has also adopted a Remuneration Committee Policy. The Policy was approvedby the Board and same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Remuneration-Committee-Policy.pdf

30. CODE OF CONDUCT

The Board has laid down a code of Conduct for all Board Members and Senior Managementof the Company. All the Board Members and Senior Management Personnel have affirmedcompliance with the Code on an annual basis.

31. INSIDER TRADING

The Board has in consultation with the Stakeholder's Relationship Committee laid downthe policy to regulate and monitor Insider Trading. The Committee regularly analyses thetransactions and monitors them to prevent Insider Trading.

The Company has also adopted a Prohibition of Insider trading Policy. The Policy wasapproved by the Board and same was uploaded on the Company's website:http://euroindiafoods.com/wp-content/uploads/2017/05/Prohibition-Insider-trading-Policy.pdf

32. SECRETARIAL AUDITOR AND REPORT

Your Company has appointed PCS Dhiren R. Dave as Secretarial Auditor of the Companyfor the period of 2 consecutive years starting from Financial Year 2016-17. TheSecretarial report for the Financial year 2016-17 is attach as "Annexure -F".

33. INTERNAL AUDITOR

Pursuant to section 138 of the Companies Act 2013 Every Listed Company is require toappoint an Internal Auditor or Firm of the Company for internal auditing of the company.

The Board had appointed M.s Sejal Maniar & Co. as An Internal Auditor of theCompany vide resolution passed in the meeting held on 29th May 2017.

34. COST AUDIT

Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Amedment Rule the activity of your company does not fall under anysectors as specified under Rule 3 of Companies (Cost Records and Audit) Rules 2014 andhence maintenance of cost records as well as the cost audit as the case may be has notapplicable to the company for the Financial Year 2016-17.

35. PARTICULAR OF EMPOYEES AND RELATED DISLOSURES

None of the employee has received remuneration exceeding the limit as stated in section197 of the companies act 2013 read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel ) Rules 2014

36. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013.

The Company had not received any case related to sexual harassment of women atworkplace. The Senior Management monitoring in the matter relates to the women's safety atworkplace. If the Compliant received by any women employee to senior management thesenior management have to convey directly to Chairman and Managing Director relates to anyComplaints in matter to sexual Harassment.

37. ACKNOWLEDGEMENT

The Board of Directors wishes to place on record its appreciation for the commitmentdedication and hard work done by the employees in the company and the co-operationextended by Banks Government authorities Customers and shareholders of the company andlooks forward to a continued mutual support and co-operation.

For the Board of Director
Euro India Fresh Foods Limited
Sd/- Sd/-
Manhar Jivanbhai Sanspara Dinesh Jivanbhai Sanspara
Place: Surat Chairman & Managing Director Joint Managing Director
Date: 24.08.2017 DIN: 02623366 DIN: 02623367