You are here » Home » Companies » Company Overview » Goodricke Group Ltd

Goodricke Group Ltd.

BSE: 500166 Sector: Agri and agri inputs
NSE: GOODRICKE ISIN Code: INE300A01016
BSE LIVE 19:40 | 19 Oct 294.95 5.75
(1.99%)
OPEN

294.80

HIGH

300.00

LOW

290.00

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 294.80
PREVIOUS CLOSE 289.20
VOLUME 38687
52-Week high 306.75
52-Week low 176.00
P/E 15.55
Mkt Cap.(Rs cr) 637
Buy Price 0.00
Buy Qty 0.00
Sell Price 293.85
Sell Qty 50.00
OPEN 294.80
CLOSE 289.20
VOLUME 38687
52-Week high 306.75
52-Week low 176.00
P/E 15.55
Mkt Cap.(Rs cr) 637
Buy Price 0.00
Buy Qty 0.00
Sell Price 293.85
Sell Qty 50.00

Goodricke Group Ltd. (GOODRICKE) - Director Report

Company director report

The Directors have pleasure in presenting their Forty-first Annual Report and Accountsfor the year ended 31st March 2017.

FINANCIAL RESULTS

(Rs. in millions)
Year ended (31.3.2017) 15 months Period ended (31.03.2016)
Revenue from Operations 6803.69 7332.42
Profit before Taxation 488.99 28.45
Tax Expense 157.67 149.85
Profit/(Loss) for the year / period 331.32 (121.40)
Other Comprehensive Income (net of tax) (44.09) (4.63)
Total Comprehensive Income 287.23 (126.03)
Other Equity at year end 2702.83 2519.59

The above figures are for 12 months and 15 months respectively hence not comparable.

SHARE CAPITAL

During the year under review:

a. No Equity shares have been issued with differential voting rights. Hence nodisclosure is required in terms of Rule 4 (4) of the Companies (Share Capital andDebentures) Rules 2014.

b. No issue of Sweat Equity Share has been made. Hence no disclosure is required interms of Rule 8 (13) of the Companies (Share Capital and Debentures) Rules 2014.

c. There was no issue of Employee Stock Option. Hence no disclosure is required interms of Rule 12 (9) of the Companies (Share Capital and Debentures) Rules 2014.

d. There was no provision made by the Company for any money for purchase of its ownshares by employees or by trustees for the benefit of employees. Hence no disclosure isrequired in terms of Rule 16 (4) of the Companies (Share Capital and Debentures) Rules2014.

e. The issued subscribed and paid up share capital of the Company as on 1st April2016 stood at Rs. 216 million divided into 21600000 Equity Shares of Rs.10/- each remainedunchanged as on 31st March 2017.

TRANSFER TO RESERVE

Your Directors do not propose to transfer any amount to the General Reserve for thefinancial year ended 31st March 2017.

DIVIDEND

Your Directors have recommended a dividend of Rs. 4.50 per share (45 %). On approval atthe forth coming Annual General Meeting Dividend will be paid to those members whosenames are recorded in the Register of the Company at the close of business on 20th July2017 subject however to the provision of Section 126 of the of the Companies Act 2013.This equity dividend has not been included as a liability in the financial statement.

OPERATIONS

The Company performed creditably by harvesting a crop of 15.92 million Kgs. in Dooarswhilst in Assam the same was 2.41 million kgs. and Darjeeling harvested 0.45 million kgs.over the 12 months period.

Substantial early rainfall combined with judicious usage of our excellent irrigationfacilities as well as the good controls exercised over pest activity were the key factorsthat contributed to this achievement. Mother nature was kind and no garden suffered onaccount of hail storm as was the case in the previous year.

The out-sourced leaf segment registered lower volumes than expected on account of thefact that operations had to be scaled down in order to not jeorpardise quality of our ownproduce in the light of the higher than targeted harvest levels from our gardens.

The profitability of the garden operations in Dooars was affected on account of thefollowing factors :-

1) The confusion created on account of the chaotic implementation of the pan Indiaauction led to couple of sales being cancelled on account of non-participation of buyercommunity in the peak cropping months of September/October and there was a deliberatewithdrawal of part of the buying community from the auctions till sanity was restored byTea Board.

2) Extended pre-bonus agitation post bonus absenteeism caused upheavel in pluckingoperations leading to gardens having to skiff tea areas due to extended plucking rounds.

3) Demonitization related upheaval in Siliguri Auction where at least 75% of our Dooarsproduce is sold post 2nd flush. The tertiary markets collapsed on account ofdemonitization which led to large scale withdrawal of the buying community for North Indiaand this led to collapse of the market with only a handful of buyers operating at muchlower levels than anticipated for lower and selected volumes of teas.

Unfortunately this also coincided with the high cropping months of October and Novemberwherein Puja flush is harvested and good rainfall in October had resulted in substantiallyincreased harvest levels in these two months as well. This resulted in over supply of teasin a market which was already financially strapped and very subdued. All of which led toprice levels depressing beyond economic threshold levels for a large volume of teas soldat Siliguri across the spectrum.

Markets for Orthodox teas though remained comparatively more buoyant on account ofexport queries and commitments. Your garden in Mangaldai Assam recorded hither tounattained levels of Orthodox production resultant of which the profit levels of thesegardens witnessed sharp rise.

Produce of the Darjeeling estates of the group featured amongst the top marks in pricerealization and despite market trends was able to derive attractive price levels.

It is with some level of satisfaction that one would like to record here that theCompany's exports touched a figure of 5.6 million kgs. in the year.

The Instant Tea Plant at Aibheel Tea Estate continued to perform very satisfactorilyand as an EOU contributed close to 300 MT in export volumes.

Branded Tea business was the single largest contributor to the over all profits of theCompany in the year and currently the Goodricke brand holds the largest market share inMadhya Pradesh. In the Darjeeling tea segment the Company's brands have the largest marketshare in Kolkata urban market. This is seen as a prime growth area for the company with apresence in all three growing regions of North India the company has a large bouquet ofTea to be offered to the consuming public.

CHANGE IN NATURE OF BUSINESS IF ANY

There has been no change in the nature of business and the Company continues toconcentrate on its own business with growth plans in short to medium terms.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Your Board of Directors at its Meeting held on 23rd May 2017 appointed Mr. AtulAsthana as an Additional Director to be designated as Wholetime Director & ChiefOperating Officer (COO) with effect from 1st June 2017. A notice has been received from amember under Section 160 (1) of the Companies Act 2013 proposing the appointment of Mr.Atul Asthana as a Director at the ensuing Annual General Meeting. The Board has alsore-appointed Mr. Arun Narain Singh as Managing Director & CEO for another period ofthree months with effect from 1st January 2018. The Board recommends the appointment /re-appointment of the aforesaid Directors on the ensuing Annual General Meeting.

The following persons continued as Key Managerial Personnel of the Company incompliance with the provisions of Section 203 of the Companies Act 2013.

(a) Mr. A. N. Singh Managing Director & CEO

(b) Mr. A. Sengupta Vice President and CFO

(c) Mr. S. Banerjee Sr. General Manager & Company Secretary

STATEMENT OF DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS

All the Independent Directors have given declaration as per Section 149 (7) of theCompanies Act 2013 confirming that they meet the criteria of independence as laid downunder Section 149 (6) of the Companies Act 2013.

REPORT ON CORPORATE GOVERNANCE

The Company has complied with the Corporate Governance requirements under the CompaniesAct 2013 and as stipulated in Listing Regulations. A Report on Corporate Governancealongwith the Auditor's Certificate regarding Compliance of Corporate Governance areattached as Annexure II and Annexure III respectively forming part of this Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility (CSR) Committee consist of three directors namelyDr. (Mrs) S. Kaul Chairperson and Independent Director Mr. A. N. Singh ManagingDirector & CEO and Mr. K. Sinha Independent Director as members with Mr. S. BanerjeeSr. General Manager & Company Secretary as its Secretary. The broad terms of referenceof the Corporate Social Responsibility Committee are :

— To formulate and recommend to the Board the Corporate Social Responsibilitypolicy.

— Recommend the amount of expenditure to be incurred on the activities undertaken.

— Monitor the Corporate Social Responsibility of the Company from time to time.

— Review the performance of the Company in the areas of Corporate SocialResponsibility including the evaluation of the inputs of the Company's Corporate SocialResponsibility activities.

— Review the Companies decisions on Corporate Social Responsibility matters.

The initiatives under taken by the Company on Corporate Social Responsibilityactivities during the year have been annexed as Annexure IV to the report.

DETAILS OF BOARD MEETINGS

The Board of Directors met 4 (four) times during the year on various dates as givenhereinbelow:

Sl. No. Date of the meeting No. of Directors attended the meeting
1. 23rd May 2016 5
2. 8th August 2016 6
3. 10th November 2016 5
4. 13th February 2017 6

Further details on Board of Directors are provided in the Corporate Governance Report.

COMMITTEES OF THE BOARD

a. Audit Committee

Sl. No. Name Category of Director Chairman/Members
1. Mr. K. Sinha Non-Executive- Independent Chairman
2. Mr. P. K. Sen Non-Executive - Independent Member
3. Mrs. S. A. Walker Non-Executive - Non-Independent Member

Further details of Audit Committee are given in the Corporate Governance Report.

• The Company has established a vigil mechanism / whistle blower mechanism whichoversees through the Audit Committee and addresses the genuine concerns expressed by theemployees and other Directors. The Company has also made provisions for adequatesafeguards against victimisation of its employees and Directors who express theirconcerns. The Chairman of the Audit Committee can be directly accessed by any employee forreporting issues which need to be brought to the notice of the Board.

The vigil mechanism / whistle blower policy of the Company has been uploaded on thewebsite of the Company and can be accessed at Company's weblink www.goodricke.com/corporate/Goodricke -whistle-blower - policy.

b. Nomination & Remuneration Committee

Sl. No. Name Category of Director Chairman/Members
1. Mr. K. Sinha Non-Executive- Independent Chairman
2. Mr. P.J. Field Non-Executive Member
3. Mr. P. K. Sen Non-Executive - Independent Member
4. Dr. (Mrs.) S. Kaul Non-Executive -Independent Member

Further details of Nomination and Remuneration Committee are given in the CorporateGovernance Report.

c. Corporate Social Responsibility Committee

Sl. No. Name Chairperson /Members
1. Dr. (Mrs.) S. Kaul Chairperson
2. Mr. K. Sinha Member
3. Mr. A. N. Singh Member

Further details of Corporate Social Responsibility are available in the Report onCorporate Governance.

The Committee has approved the Corporate Social Responsibility (CSR) Policy and theBudget for the Financial Year 2016 - 17 prepared in accordance with the provisions ofSection 135 (5) of the Companies Act 2013. The earmarked fund was fully spent on orbefore 31st March 2017.

d. Stakeholders Relationship Committee

Sl. No. Name Chairperson/Members
1. Dr. (Mrs.) S. Kaul Chairperson
2. Mr. K. Sinha Member
3. Mr. A. N. Singh Member

Further details of Stakeholders Relationship Committee are available in the Report onCorporate Governance.

e. Risk Management Committee

Your Board at its meeting dated 14th November 2014 has voluntarily constituted thefollowing Risk Management Committee of the Board as per Listing Regulations.

Sl. No. Name Chairman/Members
1. Mr. K. Sinha Chairman
2. Mr. P.K. Sen Member
3. Mr. A. N. Singh Member
4. Mr. S. Banerjee Member

Further details of Risk Management Committee are available in the Report on CorporateGovernance.

ANNUAL PERFORMANCE EVALUATION

A Board Evaluation Framework was adopted as per the guidance note issued by SEBI dated5th January 2017 for evaluating the performance of the Board as a whole Committees ofthe Board and also performance of the Individual Directors.

As per the said Evaluation Framework the Board evaluated the performance of the Boardits Committees and the Individual Directors for the year 2016-17. The Board and theNomination and Remuneration Committee reviewed the performance of the individualdirectors based on the criteria such as attendance and participation in the meetingspreparedness on the issues to be discussed suggestions on how risk factors may be handledetc. In addition the chairman was also evaluated on the above aspects by the independentdirectors.

The Independent Directors also carried out the performance evaluation in terms of PartVII (3) (c) of Schedule IV of the Companies Act 2013 in their Meeting held on 23rd May2017.

ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 of the CompaniesAct 2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014forming a part of this Report attached as Annexure V.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Clause (c) of sub section 3 of Section 134 of theCompanies Act 2013 your Directors confirm that :

(a) in the preparation of the annual accounts for the year ended 31st March 2017 theapplicable accounting standards have been followed alongwith the proper explanationrelating to material departure if any.

(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 for the year ended 31st March 2017 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 the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

(d) the Directors had prepared the annual accounts on a going concern basis;

(e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

(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.

AUDITORS AND AUDIT REPORT

M/s. Deloitte Haskins & Sells LLP Chartered Accountants (Firm Registration No117366W / W-100018) were appointed as the Statutory Auditors of the Company in the lastAnnual General Meeting held on 28th July 2016 in terms of Section 139 of the CompaniesAct 2013 till the conclusion of the Annual General Meeting to be held in 2021 subject toratification by the Shareholders at every subsequent Annual General Meeting of theCompany.

The Statutory Audit Report does not contain any qualification reservation or adverseremarks.

COST AUDITORS

In terms of Sub Section (3) of Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Rules 2014 M/s. Shome & Banerjee CostAccountants (Firm Registration No. 000001) has been appointed by the Board of Directors inits meeting held on 23rd May 2017 as the Cost Auditor of the Company for the financialyear 2017-18 based on the recommendation of the Audit Committee. The remuneration to beratified by the Members in the ensuing Annual General Meeting.

The Cost Audit Report does not contain any qualification reservation or adverseremarks.

SECRETARIAL AUDIT

In terms of Section 204 of the Companies Act 2013 read with the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 M/s. A. K. Roy & Co.Practicing Company Secretaries FCS 5684 CP No. 4557 had been appointed SecretarialAuditors of the Company for the year ended 31st March 2017. The report of the SecretarialAuditors is enclosed as Annexure- VI to this report. The Report does not contain anyqualification reservation or adverse remark or disclaimer which requires any furthercomments or explanations.

PARTICULARS OF COMPLIANCE OF CONTRACTS OR ARRANGMENTS MADE WITH RELATED PARTIES

The related party transactions entered during the year were in ordinary course ofbusiness and also on arm's length basis in compliance with the applicable provisions ofthe Companies Act 2013 and Listing Regulations. There are no materially significantrelated party transactions made by the Company with Promoters Directors or Key ManagerialPersonnel etc. which may have potential conflict of the interest with the Company atlarge. All related party transactions are presented to the Audit Committee and the Boardif required for approval. Omnibus approval is obtained for the transactions which areforeseen and repetitive in nature. The Policy on Related Party Transactions as approved bythe Board is uploaded on the Company's website at the web link:www.goodricke.com/policy-on-related-party-transactions.

Accordingly disclosures of related party transactions in terms of Clause (h) of subsection (3) of Section 134 of Companies Act 2013 read with Rule 8 (2) of the Companies(Accounts) Rules 2014 in Form AOC - 2 is not applicable. Transactions with relatedparties as per requirements of Accounting Standard are disclosed in the notes to theaccounts annexed to the financial statements.

LOANS GUARANTEES OR INVESTMENTS

The particulars of loans guarantees or investments made under section 186 of theCompanies Act 2013 are covered in the notes of the Financial Statement for the year ended31st March 2017.

HUMAN RESOURCES

Tea being a labour intensive industry the Company has employed large number of workforce at the tea estates. Industrial Relations at all the units of the Company remainsatisfactory and there was no major disruption of work at the garden or any otherestablishment of the Company during the year under review.

The total remuneration drawn by MD & CEO and other Key Managerial Personnel formpart of Extract of the Annual Return in Form MGT - 9 to this Report enclosed as Annexure V.

In terms of requirements of Section 4 of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 the Company has formed InternalComplaints Committee for its workplaces. During the year no complaint regarding sexualharassment was received by the said Committee.

RISK MANAGEMENT POLICY

In terms of the requirement of the Companies Act 2013 and Listing Regulations theCompany has developed and implemented the Risk Management Policy. The Risk ManagementCommittee of the Board reviews the same periodically.

The Company has under taken adequate measures to mitigate various risk encountered. Inthe opinion of the Board there is no such risk which may threaten the present existence ofthe Company.

NOMINATION AND REMUNERATION POLICY

The Company's Policy relating to appointment of Directors payment of managerialremuneration Directors' qualifications positive attributes independence of Directorsand other related matters as provided under Section 178(3) of the Companies Act 2013 andListing Regulations is attached to this report as Annexure VII.

The details of Programme for familiarization of Independent Directors with the Company nature of Industry and other related matters are available on the weblink :www.goodricke.com/corporate/familiarisation-program-for-independent-directors

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

Your Company has adequate Internal Financial Control System at all levels of Managementand they are reviewed from time to time. The Internal Audit is carried out in house aswell as by firms of Chartered Accountants. The Audit Committee of the Board looks intoAuditors' review which is deliberated upon and corrective action taken wherever required.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company transferred such amount of dividend lying unpaid or unclaimed for a periodof seven years from the date of such dividend became due for payment to Investor Educationand Protection Fund (IEPF).

DEPOSITS

Your Company has not accepted any deposits from public in terms of provisions containedin Chapter V of the Companies Act 2013.

PARTICULARS OF EMPLOYEES

The ratio of the remuneration of each Director to the median employees' remunerationand other particulars or details of employees pursuant to Section 197(12) of the CompaniesAct 2013 alongwith the names of top 10 employees in terms of remuneration drawn read withRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended are attached to this Report as Annexure VIII.

POLICY ON PREVENTION OF INSIDER TRADING

Your Company has adopted a code of conduct for Prevention of Insider Trading with aview to regulate trading in Equity Shares of the Company by the Directors and designatedemployees of the Company.

The said regulation is available at Company's weblink www.goodricke.com /Corporate/Prohibition -of-insider-trading.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As per Listing Regulations Management Discussion and Analysis Report is attached asAnnexure I forming part of this report.