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Hindustan Everest Tools Ltd.

BSE: 505725 Sector: Engineering
NSE: N.A. ISIN Code: INE598D01019
BSE LIVE 15:22 | 12 Jun Stock Is Not Traded.
NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 38.70
PREVIOUS CLOSE 39.90
VOLUME 21
52-Week high 52.00
52-Week low 38.70
P/E
Mkt Cap.(Rs cr) 6
Buy Price 38.05
Buy Qty 56.00
Sell Price 0.00
Sell Qty 0.00
OPEN 38.70
CLOSE 39.90
VOLUME 21
52-Week high 52.00
52-Week low 38.70
P/E
Mkt Cap.(Rs cr) 6
Buy Price 38.05
Buy Qty 56.00
Sell Price 0.00
Sell Qty 0.00

Hindustan Everest Tools Ltd. (HINDEVERTOOLS) - Director Report

Company director report

Dear Shareholders

Your Directors present the 53rd Annual Report together with Audited Annual Accounts ofthe Company for the year ended 31st March 2016.

I. FINANCIAL PERFORMANCE

Rs. In Lakhs
FINANCIAL RESULTS 2015- 2016 2014-2015
Profit/(Loss) before Finance Cost (393.58) 78.65
Less: Finance Cost 139.99 154.80
Cash Profit/(Loss) (533.57) (76.15)
Depreciation 59.90 60.17
Net Profit/(Loss) (593.47) (136.32)
Provisions for Deferred Tax (46.90) 8.17
Profit/(loss) for the period (640.37) (144.49)
APPROPRIATION
Transfer from General Reserve - -
Carried over to next year (640.37) (144.49)

DIVIDEND

In view of the Company having exorbitant losses during the year and negative networth the Directors hereby express their inability to recommend any dividend for the yearended 31st March 2016.

AMOUNTS PROPOSED TO BE CARRIED TO RESERVES

In view of the negative net worth and exorbitant losses question of transferring anyamount to reserves does not arise.

MANAGEMENT DISCUSSION AND ANALYSIS/STATE OF AFFAIRS OF THE COMPANY

(This coveres all the matters on which discussion and analysis is required to be madein Annual Report under Regulation 34(3) of SEBI (LODR) Regulation 2015

The Company was set up in 1962 for manufacturing hand tools in collaboration withDowidat Werke Tools Ltd.Germany since then a lot of changes has taken place in hand toolsindustry and so many small small companies have grown due to which your company faces alot of competition which affects the financial position adversely . Although there areopportunities in the industry but threats of more competition along with cost overrun isalso there.

The company has only single segment of operation i.e. hand tools and no other productare being manufactured or traded. As 40% of your company’s sales comprises of exportthe foreign currency fluctuation always remain a risk. The internal control system isadequate looking to the size and nature of business. Due to facts stated above thefinancial position of the company remains critical and we expect subdued performance inthe current year also.

We would further like to mention here that due to heavy losses being incurred by thecompany during current year the company has gone sick and due to the same reason the wagesand salary are delayed. We are thankful to the employees for their cooperation with theManagement.

As company’s net worth has been completely eroded promoter directors haveconfirmed and resolved to arrange infusion of sufficient additional funds into the companyto keep is going concern by sale of surplus assets.

The Total no. of employees as on 31.3.2016 was 230.

DETAILS OF APPOINTMENT AND RESIGNATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mrs Pooja Mehra Saigal (DIN 07249183) who was appointed as addional director on30/07/2015 had also resigned on 24/09/2015 before her formal appointment by theshareholders in the last Annual General Meeting held on 29/09/2015.

Ms Chhavi Sharma (DIN 07384953) who was appointed as additional woman directors by theBoard on 31/03/2016 also resigned on 12/08/2016.

Mr. Vinod Kumar Khanna Executive Directors (Finance) and CFO have also tenders hisunwillingness to continue as directors after expiry of his current term on 16/08/2016.However he will continue as Chief Financial Officer of the company.

The Board places on record their appreciation of their valuable contribution andguidance as member of the Board.

Mr .Shravan KumarMandelia retires by rotation and being eligible offers himself forreappointment.

Mr Saurabh Parasramka (DIN 00935199) has been appointed as an additional director ofthe company w.e.f.19/08/2016 under provisions of sections 149 152 and any otherapplicable provisions of the companies act 2013 and the rules made there under (includingany statutory modification(s) or re-enactment thereof for the time being in force) andhave submitted required declarations and is eligible for appointment as a non executivedirector liable to retire by rotation. His appointment was recommended by the nominationand remuneration committee. In the opinion of the Board she is person of integrity andpossess the relevant expertise and experience. The Board recommends her appointment.

Necessary resolution for appointment of aforesaid Director has been included in theNotice in ensuing AGM for the approval of the Shareholders.

DIRECTORS’ RESPONSIBILITY STATEMENTS

In compliance to the Provisions of Section 134(5) of the Companies Act 2013 withrespect to Directors’ responsibility statement it is hereby confirmed:-

i. That in the preparation of the accounts for the financial year ended 31st March2016. the applicable accounting standards have been followed along with proper explanationrelating to material departures.

ii. That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit or loss of the Company for the year under review.

iii. That the Directors have taken proper and sufficientcare for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.

iv. That the Directors have prepared the accounts for the financial year ended 31stMarch 2015 on a "going concern" basis.

v. That the Directors had laid down proper internal Financial control to be followed bythe Company and that such internal financial controls are adequate and were operatingeffectively.

vi. That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

INTERNAL FINANCIAL CONTROLS

Your Company has in place adequate systems of internal control commensurate with itssize and the nature of its operations. These have been designed to provide reasonableassurance with regard to recording and providing reliable Financial and Operationalinformation complying with applicable statutes safeguarding assets from authorized useor losses executing transactions with proper authorization and ensuring compliance ofinternal policies.

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.

RISK MANAGEMENT POLICY

A risk management policy dully approved by the Board in place as required under section134(3)(n) of the Companies Act 2013

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 are annexedherewith as Annexure "A".

NUMBER OF MEETING OF THE BOARD

During the financial year 2015-16 seven Meeting of Board of directors were convened andheld on 3/06/1530/07/1514/08/1 618/09/1517/11/1523/02/16 and 31/03/2106. The meetingsof Audit Committee were convened and held four times during the year. The meeting ofNomination and Remuneration Committee was convened and held twice during the year.

STATEMENT ON DECLARATION BY THE INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 .

NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors KMPs and Senior ManagementPersonnel and their remuneration. The Policy is annexed herewith as Annexure"B".

The composition role functions and powers of the Nomination and RemunerationCommittee are in accordance with the Provisions of the Companies Act 2013 and the listingagreements with the Stock Exchange.

EXPLANATION OR COMMENTS ON AUDITORS’ REPORT AND SECRETARIAL AUDIT REPORT.

There are no qualifications disclaimer made by the statutory auditors in their auditreport.

However the qualifications made by Secretarial Auditors in his report regarding nonfilling of certain documents with Registrar of Companies the company shall comply thesame in due course if applicable and regarding another qualification please note thattransaction/business taken by the Board which was not in the agenda was approved by alldirectors including independent directors except one non independent directors. Further itmay also be noted that said business was non financial and pertained to authorization forsigning of Listing Agreement with Bombay Stock Exchange

The other observations made in the Auditors’ Reports are self explanatory andneeds no further explanation.

PARTICULARSOFLOANSGUARANTEESORINVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013.

These primarily consist of loans to employees as per the policies of the Company andloans to suppliers in the normal course of business of the company. The closing balancesof these loans are disclosed under the schedule of Loans and Advances in the financialStatements. The Company has not given any guarantees or made any investments during theyear which would be covered by Section 186 of the Companies Act 2013.

RELATED PARTY TRANSACTIONS

Pursuant to Section 134 of the Companies Act 2013 read with Rule 8(2) of the Companies(Accounts) Rules 2014 the particulars of contracts or arrangements entered into by theCompany with Related parties have been done at arm’s length and are in the ordinarycourse of business. Hence no particulars are being provided in Form AOC-2.

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING FIANCIAL POSITION OF THE COMPANY

There are no adverse material changes or commitments occurring after 31st March 2015which may affect the financial position of the Company or may require disclosure.

CONSERVATION OF ENERGY RESEARCH & DEVELOPMENT TECHNOLOGY ABSORPTION FOREIGNEXCHANGE EARNINGS & OUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act2013 read withRule 8 of the Companies (Accounts) Rules 2014 is annexed herewith as Annexure-"C".

BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance as a whole and individually forChairman & Managing Directors Jt Managing Director Executive Director andIndependent Directors .

The performance is being evaluated on the Basis of their attendance in the meetingscompliance of Code of conduct of the Company and applicable provisions of the companiesAct their participation level in the meetings etc.

The performance is evaluated by each director for themselves and for conduct andperformance of Board from their point of view. Independent Directors evaluated theperformance of Chairman and other non independent directors and Board as a whole in theirseparate meeting. The performance of Independent Director is evaluated by the Board.

CHANGE IN THE NATURE OF BUSINESS

During the year under review there has been no change in the nature of business of theCompany.

NAME OF THE COMPANIES WHICH HAVE BECOME/CEASED TO SUBSIDARIES JOINTVENTURES ORASSOCIATE COMPANIES DURING THE YEAR.

The Company did not have any subsidiaries associates or Joint ventures during theyear.

DEPOSITS

The Company has not accepted deposits under Chapter V of the Companies Act 2013.

SIGNIGICANT ORDERS PASSED BY REGULATORS COURTS OR TRIBUNALS IMPACTING GOING CONCERNAND COMPANYS OPERATIONS.

To the best of our knowledge the Company has not received any such orders fromRegulators Court or Tribunals during the year which may impact the going concern statusor the Company’s operations in future.

GENERAL

The Company has formulated a policy on Prevention of Sexual Harassment approved by theBoard. The policy may be accessed on the Company’s website. Your Directors furtherstate that during the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressed) Act 2013.

WHISTLE BLOWER POLICY

The Board of Directors has adopted the Whistle Blower Policy. The Policy has provided amechanism for Directors Employees and other persons dealing with the Company to report tothe Chairman of the Audit Committee any instance of unethical behavior actual orsuspected fraud or violation of the Code of Conduct of the Company.

The details of the policy have been uploaded at the website of the Company.

COMPOSITION OF AUDIT COMMITTEE

The composition of the Audit Committee is mentioned as under:-

Sh Ambarish Raj Independent Director
Sh. Pradeep Jain Independent Director
Sh. Lokesh Sood Independent Director
Sh. Saurabh Parasramka Non Executive Director

The composition role functions and powers of the Audit Committee are in accordancewith the Provisions of the Companies Act 2013 and the listing agreements with the StockExchange.

AUDITORS

M/S Singhi & Company Chartered Accountants shall continue as Statutory Auditorsof the for Financial Year 2016 -17 pursuant to approval given by the shareholders in lastAGM appointing them as Statutory Auditors’ of the company for three years. However asrequired under the provisions of Companies Act 2013 said appointment is being ratified inthe ensuing AGM.

SECRETARIAL AUDITOR

Pursuant to the provisions of section 204 of the Act the Companies(Appointment andRemuneration of Managerial Personnel) rules 2014 the of Directors has appointed Mr.Pradip Kumar Muduli practicing Company Secretary for conducting secretarial audit of thecompany for the financial year 2015-16 The Secretarial Audit Report is annexed herewith asAnnexure D The secretarial Audit Report contained few qualifications which has been dulyexplained.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Particulars of remuneration paid to the employees as required to be disclosed undersection 197(12) of the Act read with Rule 5 of the Companies (Appointment &Remuneration of Managerial Personnel) Rules 2014 are set out in ANNEXURE -E attachedhereto and form part of this Report.

CORPORATE GOVERNANCE

SEBI has exempted listed companies with equity share capital of up to Rs 10 crore andnet worth not exceeding of Rs 25 crores from the mandatory compliance of corporategovernance code. Accordingly we are not required to comply with mandatory compliance ofcorporate governance code.

ACKNOWLEDGEMENT

Your Directors wish to place on record their sincere appreciation to employees fortheir continuous efforts and valuable services rendered by them at all levels.

FOR & ON BEHALF OF THE BOARD
Place : New Delhi BALGOPAL MANDELIA
Dated : August 19 2016 CHAIRMAN
DIN00040592