Your Directors are pleased to present their 34th Annual Report and the Audited Accountsof the year ended March 31 2016.
|FINANCIAL RESULTS : || ||Rs. in lakhs |
| ||2015-16 ||2014-15 |
|a) Sales & Other Income ||3347.93 ||3105.56 |
|b) Profit/Loss before Depreciation and Tax ||(278.67) ||(206.19) |
|c) Provision for Depreciation ||142.26 ||147.69 |
|d) Provision for Tax ||(394.87) ||76.62 |
|e) Exceptional Items ||2181.91 ||51.20 |
|f) Profit after Depreciation and Tax ||1366.09 ||(226.06) |
|g) Balance from previous years ||195.43 ||465.06 |
|h) Balance carried forward ||1561.52 ||195.43 |
During the year under review the turnover of the Company was higher to the tune of Rs.3347.93 lakhs compared to Rs. 3105.56 lakhs in the previous financial year. There was anet loss from operations of Rs. 278.67 lakhs during the current financial year compared toa net loss of Rs. 206.19 lakhs during the previous financial year due to write off of nonmoving inventory of glass lenses. Sale of plastic lenses has picked up but there is severecompetition from China.
There was a net profit of Rs. 1366.09 lakhs due to sale of stake of the Company in GKBVision Limited.
Since the Company has posted an operating loss your Directors regret their inabilityto recommend any dividend for the year 2015-16.
No amount has been transferred to reserve for the financial year ended March 31 2016.
The Company's Wholly Owned Subsidiary (WOS) in Sharjah UAE Free Trade ZoneEstablishment has achieved a turnover of Dirhams 6.41 million for the year ended December31 2015 as compared to Dirhams 7.13 million during the previous year. The net profit isDirhams 0.93 million as compared to Dirhams 1.16 million during the previous year and hasdeclared a dividend which entails an outflow of Dirhams 0.37 million.
The proposal for winding up GKB Ophthalmics GmbH is pending for approval with ReserveBank of India Mumbai.
A statement under Section 129(3) of the Companies Act 2013 giving details ofsubsidiaries is attached in Form AOC-1. Audited Accounts in respect of subsidiaries isplaced on website of the Company www.gkb.net. The Company will make the said annualaccounts of its subsidiaries available to the members upon a written request. The auditedannual accounts of the Subsidiaries is available at the Registered Office of the Companyfor inspection.
However in accordance with Accounting Standards 21 issued by the Institute ofChartered Accountants of India the Consolidated Accounts of the Company and itssubsidiaries have been prepared and form part of this Annual Report.
The government has formally withdrawn the recognition of Delhi Stock Exchange. Hencethe equity shares of the Company stand delisted.
The company has been accredited with ISO 9001:2008 by TUV Nord.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Mr. Vikram Gupta will retire by rotation pursuant to Articles of Association of theCompany being eligible offers himself for re- appointment.
Brief resume together with other relevant details of Mr. Vikram Gupta are given in NoteNo. 09 of the Notice for the ensuing Annual General Meeting.
Pursuant to provisions of Section 2 (51) and Section 203 of the Companies Act 2013read with Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 the Board of Directors have designated the following existing officers of theCompany as Whole-Time Key Managerial Personnel.
Mr. K. G. Gupta Managing Director and Mr. Noel da Silva CFO & Company Secretaryare Whole-Time Key Managerial Personnel of the Company .
SEPARATE MEETING OF THE INDEPENDENT DIRECTORS :
In terms of Section 149 (8) read in terms of schedule IV the Independent Directorsheld a Meeting on March 30 2016 without the attendance of Non-Independent Directors andmembers of Management. All the Independent Directors were present at the meeting.
At this meeting the Independent Directors :
1. Reviewed the performance of the Non-Independent Directors and the Board as a whole.
2. Reviewed the performance of Chairperson taking into account the views of ExecutiveDirectors and Non- Executive Directors.
3. Assessed the quality quantity and timeliness of flow of information between theCompany Management and the Board that is necessary for the Board to effectively andreasonably perform their duties.
4. Discussed and decided about the familiarization of Independent Directors' programmeconducted by the Company and also views of the Independent Directors on thefamiliarization programmes.
The Independent Directors have confirmed that they meet with the criteria ofIndependence laid down under the Act and Listing Regulations.
INDEPENDENT DIRECTORS DECLARATION :
The Independent Directors have submitted the Declaration of Independence as requiredpursuant to Section 149 of the Companies Act 2013 and provisions of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 stating that they meet thecriteria of independence as provided therein.
MEETINGS OF THE BOARD OF DIRECTORS :
During the year under review six Board Meetings were held. Further details are givenin Corporate Governance Report forming part of this Report.
The maximum gap between two Board Meetings held during the year was not more than 120days.
AUDIT COMMITTEE :
As provided in section 177(8) of the Act the information about composition of AuditCommittee and other details are given in Corporate Governance Report. The Board hasaccepted the recommendations of the Audit Committee.
The Audit Committee is comprising of Mr. Sadashiv Shet as Chairman Mr. Gaurav GuptaMr. Anil Palekar Mr. Joseph A.A. D'Costa and Mr. Christopher Hickman as members.
NOMINATION AND REMUNERATION COMMITTEE :
The Nomination and Remuneration Committee has formulated the criteria for determiningqualifications positive attributes and independence of a director relating toremuneration for directors key managerial personnel as provided under section 178(3) ofthe Companies Act 2013 and Listing Regulations.
The Remuneration Policy is stated in the Corporate Governance Report which is part ofthis report. Further details have been disseminated on the Company's webiste www.gkb.net
PERFORMANCE EVALUATION :
The Board evaluated the performance of the Board as a whole committees of the Boardand the performance of individual directors including the Chairman of the Board pursuantto the Regulation 17(10) of the Listing Regulations. The Independent Directors alsocarried out the performance evaluation in terms of Part VIII of Schedule IV of theCompanies Act 2013 in their meeting held on March 30 2016.
The details of the Performance Evaluation carried out is provided in the CorporateGovernance Report which is a part of this report.
DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to provision of Section 134 (5) of the Companies Act 2013 the Board ofDirectors to the best of their knowledge and ability hereby state and confirm :
a) that in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures.
b) that they have selected such accounting policies and applied them consistently andmade judgements 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 financial year and of theProfit and Loss of the Company for that period;
c) that they have 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) that they have prepared the annual accounts on a going concern basis;
e) that they have 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 have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
The term of M/s. Sharp & Tannan Chartered Accountants Mumbai (Firm RegistrationNo. 109982W) as Statutory Auditors expires at the conclusion of this Annual GeneralMeeting and are eligible for re-appointment as Statutory Auditors of the Company to holdoffice till the conclusion of the Company's Thirty Ninth Annual General Meeting subjectto ratification as to the said appointment at every Annual General Meeting. The Auditorshave given a certificate that the re-appointment if made will be within the prescribedlimits specified under Section 139 of the Companies Act 2013. They also have givena certificate that they fulfill all the criteria laid down under Section 141 of theCompanies Act 2013.
In respect of the observations made by the Auditors in their Report the Board'sresponse thereon is as follows:
a) With regard to paragraph (i) (b) of the annexure referred to in Para (1) of theAuditor's Report the physical verification of the fixed assets is in a advanced stage ofcompletion.
b) Paragraphs (ii) (iv) and (vii) a of the said annexure are self explanatory.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS :
There is no significant or material order passed by any Regulators or Courts orTribunals impacting the going concern status and Company's operations in future.
INTERNAL FINANCIAL CONTROL :
As per Section 134 (5) (e) of the Companies Act 2013 read with Rule 8 (viii) ofCompanies (Accounts) Rules 2014 the Board has laid the Internal Financial Control to befollowed by the Company and that such Internal Financial Controls are adequate and areoperating effectively.
Internal Audit is carried out by a Chartered Accountant and the report submitted isdeliberated by the Audit Committee of the Board.
RISK MANAGEMENT POLCY :
The Company has constituted the Risk Management Committee which has formulated RiskManagement Policy for the Company. The committee identifies and assesses the variousbusiness risks and mitigates these risks by determining a response strategy. The policy isreviewed by the members in consultation with the Senior Management of the Company fromtime to time.
PRATICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 :
Particulars of loans guarantees given and investments made during the year as requiredunder Section 186 of the Companies Act 2013 and Schedule V of the Listing Regulations areprovided in Notes 3 6 8 11 and 17 of the Financial statements.
RELATED PARTY TRANSACTIONS :
All transactions entered into with related parties pursuant to Section 188 of theCompanies Act 2013 and Regulation 23 of Listing Regulations during the year were atarms's length basis and in ordinary course of business. Therefore disclosure in FormAOC-2 is not required.
EXTRACT OF ANNUAL RETURN :
As required as per Section 92(3) of the Companies Act 2013 and the Rules framedthereunder the extract of the Annual Return in Form MGT-9 is annexed herewith asAnnexure - I.
CORPORATE GOVERNANCE :
A separate section on Corporate Governance practices followed by the Company togetherwith certificate from the Practising Company Secretary confirming compliance forms a partof this Annual Report as per Listing Regulations.
As per provisions of Section 204 of the Companies Act 2013 read with Rule 9 ofCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theSecretarial Audit Report submitted by Ms. Girija Nagvekar Practising Company Secretaryfor the financial year ended March 31 2016 forming part of this Annual Report isannexed herewith as Annexure- II. The Secretarial Audit Report is self explanatory andrequires no comments.
CORPORATE SOCIAL RESPONSIBILITY :
Provisions of Section 135 of the Companies Act 2013 and Rules made thereunderregarding Corporate Social Responsibility are not applicable to the Company.
The Company has taken adequate insurance covers for its properties and insurableinterest.
FIXED DEPOSIT :
The Company has not accepted any deposits from the public during the year. No amount onaccount of principal or interest on public deposits was outstanding as on the date of theBalance Sheet.
The relations between the employees and the management during the year have beencordial.
MATERIAL CHANGES AND COMMITTMENTS :
There were no material changes and commitments which would affect the financialposition of the Company.
PARTICULARS UNDER SECTION 197(12) AND RULE 5 OF THE COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014 :
(i) the ratio of the remuneration of each director to the median remuneration of theemployees of the Company
for the financial year: Name Ratio
Mr. K. G. Gupta Managing Director 23:1
(ii) the percentage increase in remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
|Name ||Percentage |
|Mr. K. G. Gupta Managing Director ||58.00% |
|Mr. Noel da Silva CFO & Company Secretary ||8.62% |
(iii) the percentage increase in the median remuneration of employees in the financialyear : 12.52%
(iv) the number of permanent employees on the rolls of Company : 254
(v) the explanation on the relationship between average increase in remuneration andcompany performance :
Employees are granted increment based on their performance as well as the performanceof the Company. The net operational loss for the financial year ended March 31 2016 wasRs. 278.67 lakhs and whereas the increase in average remuneration was 8.28 %
(vi) comparison of the remuneration of the Key Managerial Personnel against theperformance of the Company :
The total revenue from sales and other income of the Company for the year 2015-16 wasRs. 3347.93 lakhs as compared to Rs. 3105.56 lakhs for the previous year 2014-15.However there was a profit of Rs. 1366.09 lakhs due to sale of stake of the Company inGKB Vision Limited as compared to a loss of Rs. 226.06 lakhs in the year 2014-15. TheCompany's performance during the year 2015-16 was considered while approving the increasein remuneration of Key Managerial Personnel .
(vii) variation in the market capitalisation of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease over decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer in case of listedcompanies and in case of unlisted companies the variations in the net worth of theCompany as at the close of the current financial year and previous financial year:
|Sr. No. Particulars ||As on March 31 2016 ||As on March 31 2015 ||Remarks |
|1 Market Capitalisation (Rs. in lakhs) ||2782.89 ||2984.34 ||Company's public offer was in the year April 1996 |
|2 Price earnings ratio ||2.06 ||(12.97) || |
|3 Closing market price of equity shares (Rs) ||67.00 ||71.85 || |
(viii) average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration: The averagepercentile increase in the salaries of employees was 6.36% compared to the averagepercentile increase of 27.98% in the managerial remuneration.
(ix) comparison of each remuneration of the Key Managerial against the performance ofthe Company: The increase in remuneration of the Managing Director was within the minimumremuneration as per Schedule V Part II and Section II of the Companies Act 2013.
(x) the key parameters for any variable component of remuneration availed by thedirectors :
Mr. K. G. Gupta Managing Director is entitled to commission not exceeding 1% of thenet profit of the Company computed in the manner laid down under the Act as may bedetermined by the Board. Due to operational loss no commission was paid to him for theyear under review. None of the other Directors are paid any remuneration except sittingfees and travelling expenses for attending Board and Committee Meetings.
(xi) the ratio of the remuneration of the highest paid director to that of theemployees who are not directors but receive remuneration in excess of the highest paiddirector during the year : N.A.
(xii) affirmation that the remuneration is as per the remuneration policy of theCompany : The remuneration is as per the Remuneration Policy of the Company.
PARTICULARS OF EMPLOYEES :
None of the employees is covered under Section 197 of the Companies Act 2013 readwith Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT :
As per Listing Regulations Management Discussion and Analysis Report is attached asannexure to this report.
The Company has availed additional loans of Rs. 20.00 lakhs from Banks during thefinancial year ended March 31 2016.
CREDIT RATING :
Bank's Loan facilities Rating has been improved from "CRISIL D" to"CRISIL B/Stable" for long term rating and from " CRISIL D" to"CRISIL A4" for short term rating.
DISCLOSURE UNDER THE SEXUAL HARRASMENT 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 and Redressal)Act 2013. Internal Complaints Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) are covered under this policy.
During the year under review no complaints were received.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO :
Particulars required to be disclosed under the provisions of Section 134(3)(m) of theCompanies Act 2013 read with Rule 8 of Companies (Accounts) Rules 2014 are annexedherewith as Annexure III and forms an integral part of this report.
Your Directors wish to acknowledge and are grateful for the excellent support receivedfrom all levels clients suppliers regulatory authorities Banks and all otherstakeholders. Your Directors recognize and appreciate the hard work and efforts put in byall the employees of the Company and their contribution to the progress of the Company ina very challenging environment.
| ||FOR AND ON BEHALF OF THE BOARD OF DIRECTORS |
|Place : Mapusa Goa. ||K. G. GUPTA |
|Date : May 30 2016 ||CHAIRMAN & MANAGING DIRECTOR |