Kesar Terminals & Infrastructure Ltd.
|BSE: 533289||Sector: Others|
|NSE: KTIL||ISIN Code: INE096L01025|
|BSE 15:43 | 16 Jan||192.95||
|NSE 15:56 | 16 Jan||193.35||
|Mkt Cap.(Rs cr)||211|
|Mkt Cap.(Rs cr)||210.70|
Kesar Terminals & Infrastructure Ltd. (KTIL) - Director Report
Company director report
Kesar Terminals & Infrastructure Ltd.
Your Directors present to you the 8th Annual Report and the Audited Statement ofAccounts of the Company for the year ended 31st March 2016.
STANDALONE FINANCIAL RESULTS
(Rs. in Lac)
For the year 2015-16 there is a profit after tax of Rs.1553.98 lac as againstRs.1450.59 lac in the previous year.
The Directors are pleased to recommend a dividend of Re.1.00 per Equity Share (10%) ofRs.10/- each on 52531 13 Equity Shares of the Company for the year 2015-16 (previousyear Rs.3.50 per Equity Share - 35%). The dividend payout will be Rs.52.53 lac excludingdividend distribution tax of Rs.10.69 lac.
WORKING FOR THE CURRENT YEAR
During the year under review your Company achieved a turnover of Rs.4396.82 lac asagainst Rs.4223.61 lac in the previous year recording a growth of 4.10%. The Companyrecorded an increase of 9.12% in its profit after tax which grew from Rs.1450.59 lac toRs.1553.98 lac. The Company's healthy performance was attributed to better realisation interminal tankage charges and improvement in the average commercial utilization charges oftanks.
SUBSEQUENT FINANCIAL YEAR 2016-17
For the financial year 2016-17 the demand for tankage is expected to remain firm. Thetwo new bulk liquid storage terminals that came up in Pipavav port have not significantlyimpacted demand for tankage at Kandla. However the terminal users have been resistingannual increase in rental charges which was being accepted in the past.
EXPANSION / MODERNISATION
The Company has been exploring new avenues to optimize and expand its present capacityat its Terminals at Kandla. However as the issue of transfer of lease of land in favour ofthe Company post demerger is yet to take place no favourable response is coming from KPTfor construction of new capacities. During the year the Company proposes to convertfurther of its existing Mild Steel tanks into Stainless Steel tanks based on the marketdemand.
The Company has about 10 acres of land on long term lease basis at Kakinada port inAndhra Pradesh. The Company plans to put up both Dry Cargo Warehousing and Bulk LiquidTerminal facilities at Kakinada. Necessary statutory permissions are being obtained fromvarious State Government bodies including a No objection Certificate (NOC) from theDistrict Magistrate for putting up the proposed facilities.
The Company has plans to set up a Container Freight Station [CFS] Bonded Warehouse andBulk Liquid terminal at Pipavav. The preliminary work at Pipavav is expected to commenceafter Phase I of the Composite Logistics Hub Project of the Subsidiary Company KesarMultimodal Logistics Ltd. (KMLL) stabilises its operation.
The % shareholding of the Company along with its Nominees in the Equity Share Capitalof Kesar Multimodal Logistics Ltd. (KMLL) is above 50%. Hence there is a Holding -Subsidiary relationship between the Company & KMLL. The Annual Report of the Companydoes not contain the individual financial statements of KMLL but contains the auditedconsolidated financial statements of the Company and KMLL. The Annual Accounts of theSubsidiary Company along with the related information is available for inspection at theCompany's registered office. Particulars under AOC-1 forms part ofthe notes to thefinancial statements annexed herewith.
CONSOLIDATION FINANCIAL STATEMENTS:
The Consolidated Financial Statements of the Company prepared as per AccountingStandard AS 21 consolidating the Company's accounts with its subsidiary have also beenincluded as part of this Annual Report.
COMPOSITE LOGISTICS HUB PROJECT AT MADHYA PRADESH
The Multimodal Composite Logistics Hub project is set up by Kesar Multimodal LogisticsLtd. (KMLL) the Subsidiary of the Company at Powarkheda under a Concession Agreementsigned by KMLL with Madhya Pradesh State Agricultural Marketing Board (Mandi Board) on aDesign Build Finance Operate and Transfer (DBFOT) basis through Public PrivateParticipation (PPP). The Hub covers an area of 88.3 acres which includes development ofan entire range of infrastructure including rail sidings for cargo and container movementrail- side warehouses Inland Container Depot (ICD) Cold Storage food grains warehouse& development of common facilities for putting up agri-processing units. This Projectwill be developed in 2 phases out of which the 1st phase has become operational.
The West Central Railway Jabalpur Madhya Pradesh has notified the Private FreightTerminal [PFT] of KMLL served by Powarkheda (PRKD) station of Bhopal Division as aGreenfield PFT.
KMLL has been appointed as the Custodian ofthe import/export of goods received at ICDof KMLL by the Office of the Principal Commissioner of Customs Central Excise &Service Tax Bhopal (Madhya Pradesh) the exporters & importers from the catchmentarea of the Hub will be now able to complete all Customs formalities at this location thatwere earlier required to be done at the Port. The Rail Terminal Operations and movement ofgoods train has started from the Hub of KMLL.
The facilities at the Hub also permit transportation of food grains soya extractvegetables and fruits from this location to any location in India by rail within 24 hours.This location which is situated at nearly the centre of Indian Railway map offers anopportunity to the manufacturers of bulk commodities such as cement steel fertilizeretc. to quickly move their cargo from their manufacturing points to the Terminal forstorage and onward distribution. The manufacturers of FMCG or white goods can also use thelocation as a central storage and distribution point for pan India distribution of theirproducts. This will be a desired location for such pan India distribution once GST becomesa reality.
The facilities at the Hub also permits rail transportation of ICD containers fromsurrounding areas to the major ports like JNPT Mundra & vice-versa for both exports& imports thereby saving costly road freight besides reducing pollution of truckmovement.
The paid up Equity Share Capital as on 31.3.2016 was Rs.5.25 crore. During the yearunder review the Company has not issued any shares. The Board has recommended issue ofBonus Shares subject to approval of Shareholders by capitalization of Rs.2101250/-(Rupees Twenty One Lac One Thousand Two Hundred Fifty Only) out of the Free Reserves ofthe Company as an increase in the Equity Share Capital of the Company held by each suchMember and not as income or in lieu of dividend credited as 210125 new fully paid upEquity Shares of Rs.10/- as Bonus Shares in proportion of One (1) new Equity Share ofRs.10/- for every Twenty Five (25) existing fully paid Equity Shares of Rs.10/- each heldby the Members.
Since the operations of the Company has grown significantly during the last few yearsit has generated considerable interest in the trading of the Company's Equity Shares inthe market. This coupled with the general positive economic environment the market priceof the Company's shares have also increased significantly. In order to improve theliquidity of the Company's shares in the stock market and to make it affordable to thesmall investors the Directors have recommended sub-dividing the Face Value of the EquityShares of the Company. Accordingly the Bonus Shares as and when allotted will be adjustedas to its face value.
During the year 5 (five) Board Meetings and 4 (four) Audit Committee Meetings wereconvened and held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013.
DIRECTORS & KEY MANAGERIAL PERSONNEL
Pursuant to Section 152 of the Companies Act 2013 Mrs. M H Kilachand Non ExecutiveDirector of the Company retires by rotation at the ensuing Annual General Meeting andbeing eligible offers herself for reappointment. As per the SEBI (Listing Obligation& Disclosure Requirements) Regulations 2015 brief profile of Mrs. M H Kilachandretiring by rotation forms part of the Corporate Governance Report.
All the Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and the SEBI(LODR) Regulations 2015.
Pursuant to the provisions of Regulation 25 of the SEBI (LODR) Regulations 2015 theCompany has formulated a programme for familiarising the Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company etc through various initiatives.The details of the aforementioned programme is available at the Company's website
MATERIAL CHANGES & COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THEFINANCIAL YEAR & DATE OF THIS REPORT:
Shri H R Kilachand ceased to be the Executive Chairman & Director of the Companywith effect from 29.4.2016 on his resignation due to his engagement in other businessactivities. Consequent to the resignation of Shri H R Kilachand the Board of Directorshad appointed Shri A S Ruia Independent Director as Chairman of the Company with effectfrom 29.4.2016.
Based on the recommendation of the Nomination & Remuneration Committee and subjectto approval of the Shareholders on 29.4.2016 the Board had appointed Shri R H Kilachandas Whole-Time Director designated as Executive Director of the Company. Prior to hisappointment Shri R H Kilachand was working with the Company as Vice President.
Consequent to the resignation of Shri Bhautesh Shah Shri Dilip Maharana was appointedas Company Secretary with effect from 26.5.2016 pursuant to Section 203 of the CompaniesAct 2013.
BOARD EVALUATION / APPOINTMENT AND REMUNERATION POLICY FOR DIRECTORS AND SENIORMANAGEMENT
Pursuant to the provisions of the Companies Act 2013 the Board carried out an annualPerformance Evaluation of its own performance the Directors individually as well as theevaluation of the working of its Audit & Nomination & Remuneration Committees.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report. Thedetails of the Nomination & Remuneration Policy are available on the website of theCompany www.kesarinfra.com/Investor'sCorner/Policies.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(3)(c) of the Companies Act 2013 the Boardof Directors to the best of their knowledge hereby state:
i) that in preparation of the annual accounts for the financial year ended on 31stMarch 2016 the applicable accounting standards have been followed along with properexplanation relating to material departures;
ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are 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 for that period;
iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv) that the Directors have prepared the Annual Accounts for the financial year endedon 31st March 2016 on a going concern basis.
v) that the Directors have laid down proper internal financial controls in place andthat such internal financial controls are adequate and were operating effectively.
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.
RELATED PARTY TRANSACTIONS
The details of contracts or arrangements with related parties referred to in Section188 (1) of the Companies Act 2013 in form AOC-2 is annexed herewith as Annexure"A".
A policy of Related Party Transactions as approved by the Audit Committee and the Boardof Directors is uploaded on the website of the Company
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial statements.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 isannexed herewith as Annexure "B".
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
MANAGEMENT DISCUSSION & ANALYSIS REPORT AND CORPORATE GOVERNANCE REPORT
The Management Discussion & Analysis Report is annexed and forms part of thisAnnual Report. The Company has complied with the Corporate Governance requirements asstipulated under Regulation 34 of the SEBI (LODR) Regulations 2015. A separate section onCorporate Governance along with a certificate from the auditors confirming thecompliance is also annexed and forms part of the Annual Report.
In compliance with the SEBI regulation on prevention of Insider Trading your Companyhas framed a comprehensive code which lays down guidelines and advises the Directors andemployees of the Company on procedures to be followed and disclosures to be made whiledealing in securities of the Company. During the year under review the Company adoptedCode of Practices and Procedures for Fair Disclosure of Unpublished Price SensitiveInformation and the Code of Conduct for Prohibition of Insider Trading in accordance withSEBI (Prohibition of Insider Trading) Regulations 2015.
SEXUAL HARASSMENT POLICY
The Company has constituted an Internal Complaint Committee (ICC) for prevention andredressal of complaints / grievances on the sexual harassment of women at work places.During the year under review no incident had taken place.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars under Section 134(3)(m) of the Companies Act 2013 with respect toconservation of energy technology absorption is not applicable to the Company. During theyear under review there were no foreign Exchange Earnings (Previous year Nil) and ForeignExchange Outgo stood at Rs.2080406/- (Previous Year Rs.345398/-).
As per the Companies Act 2013 the Company is not eligible to raise Fixed Deposits interms of Section 73 of the Act. Hence the Company has not accepted / renewed FixedDeposits w.e.f. 1.4.2014.
Further as per Section 74(1) of the Companies Act 2013 the Company was required torepay the existing Fixed Deposits on or before 31.3.2015. However as per Section 74(2) ofthe Act the Company had hied a petition with the Company Law Board Mumbai Bench forextension of time to repay Fixed Deposits. The approval for the same is awaited.
As on 31.3.2016 the outstanding Fixed Deposit principal amount is Rs.6990000/-.Rs.252000 remained unclaimed in respect of 7 Fixed Deposit holders.
M/s Haribhakti & Co. LLP Chartered Accountants were appointed as StatutoryAuditors of the Company to hold office till conclusion of the Annual General Meeting to beheld in the calendar year 2019. In terms of the provisions of the Section 139(1) of theCompany's Act 2013 the appointment of M/s Haribhakti & Co. LLP Chartered Accountantsis placed for ratification by the Shareholders.
There are no qualifications reservations or remarks in the Auditors Report.
INTERNAL CONTROL SYSTEM & INTERNAL AUDITORS
The Company has an adequate Internal Control System. All transactions are properlyauthorised recorded and reported to the Management. The Company has Independent AuditorsM/s. Ashok Jayesh & Co. Chartered Accountants to review critical areas of operations.The Audit Reports are reviewed periodically by the management and the Audit Committee ofthe Board and appropriate measures are taken to improve the process.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s Ragini Chokshi & Co. Practicing Company Secretary to undertake theSecretarial Audit of the Company. The Report of the Secretarial Audit Report is annexedherewith as Annexure- "C". There are no qualifications reservations orremarks in the Secretarial Audit Report.
CORPORATE SOCIAL RESPONSIBILITY
As the Company meets with one of the criteria of Section 135(1) of the Companies Act2013 it has constituted a CSR Committee. The composition and functions of the CSRCommittee has been detailed in the Corporate Governance Report. The Company has undertakenCSR activities in accordance with Schedule VII of the Companies Act 2013. The AnnualReport on CSR activities is annexed herewith as Annexure-" D".
Relation with the employees remained cordial throughout the year. Your Directors placeon record their sincere appreciation for the excellent spirit and commendable progressshowcased by the entire team of the Company working at its Terminals and Offices.
The information required pursuant to Section 197(12) of the Companies Act 2013 readwith Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of employees on the payroll of the Company in India is providedas Annexure-" E" which forms part of this report.
The information required pursuant to Section 197 read with Rule 5(2)&(3) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company will be provided upon request. In terms of Section 136 of theAct the Report and Accounts are being sent to the Members and others entitled theretoexcluding the information on employees' particulars which is available for inspection bythe Members at the Registered Office of the Company during business hours on working daysof the Company up to the date of the ensuing Annual General Meeting. Any member interestedin obtaining such particulars may write to the Company Secretary at the registered officeof the Company.
Your Directors wish to place on record their grateful appreciation for the assistanceand cooperation extended by the Banks Financial Institutions Customers and thewholehearted support extended by the shareholders during the year.