The Board of Directors are pleased to present the Company's Twenty Eighth AnnualReport and the Company's Audited Financial Statements (Standalone and Consolidated)for the financial year ended March 31 2017.
1. FINANCIAL RESULTS:
The Company's financial performance for the year ended March 31 2017 is summarisedbelow:
| || || || ||Rs. in Lakhs |
|Particulars ||Standalone ||Consolidated |
| ||2016 - 17 ||2015-16 ||2016 -17 ||2015 -16 |
|Sales || || || || |
| ||43547.62 ||46441.83 ||47966.06 ||46441.83 |
|Other Income || || || || |
| ||252.99 ||436.78 ||261.49 ||436.78 |
|Profit before Depreciation || || || || |
| ||4014.56 ||3242.44 ||4029.09 ||3242.44 |
|Interest and Tax (PBDIT) || || || || |
|Less: Interest ||3867.67 ||3732.34 ||3867.67 ||3732.34 |
|Less: Depreciation ||1257.30 ||1453.02 ||1257.30 ||1453.02 |
|Profit before Tax ||(1339.77) ||(1980.82) ||(1325.24) ||(1980.82) |
|Provision for Taxation ||- ||- ||3.73 ||- |
|Income Tax || || || || |
|Deferred Tax ||(1162.31) ||(449.32) ||(1162.31) ||(449.32) |
|(Short)/Excess Provision ||- ||- ||- ||- |
|Mat Credit Entitlement (For Earlier Year) ||- ||- ||- ||- |
|Net Profit After Tax ||(177.46) ||(1531.50) ||(166.66) ||(1531.50) |
|Balance brought forward ||(892.42 ) ||878.60 ||(892.42 ) ||878.60 |
|Net Balance ||(1069.87) ||(652.9) ||(1059.08) ||(652.9) |
2. RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS:
On a consolidated basis the Company during the year under review has reduced loss toRs. 166.66 Lakhs when compared with Rs. 1531.50 Lakhs in the previous year. The Company isrelentlessly trying its best to improve the above digits and to the extent it hassucceeded too in its efforts and the same can be affirmed by comparing the above digits.The focus of the Company has been to drive growth and efficiency of business modelsproducts and services business processes as well as the workplace. This helps deliver asuperior experience to every key stakeholder viz. customers employees investors and thecommunity In the ensuing years the directors are hopeful of achieving better results.
The turnover of your Company has increased to Rs. 47966.06 Lakhs when compared with Rs.46441.83 Lakhs in the previous year. In order to increase further sales in the nearfuture the Company is planning to adopt various strategies and programmes which willboost the demand for the Company's products.
The Company is of the view to focus on magnifying innovations in the marketplacethrough brilliant execution and on building markets of the future or what we call asmarket development' and thereby enhancing stakeholders value.
3. TRANSFER TO GENERAL RESERVE:
During the year under review the Company did not transferred any amount to the GeneralReserve.
In view of the accumulated losses your directors are unable to declare any dividendfor the year under review.
The Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 and as such noaccount of principal or interest on deposits from public was outstanding as on the date ofthe balance sheet.
6. MATERIAL CHANGES:
There have been no material changes and commitments affecting the financial position ofthe Company during the financial year
2016-17. There has been no change in the nature of business of the Company.
7. DIRECTOR'S RESPONSIBILITY STATEMENT:
Pursuant to section 134(5) of the Companies Act 2013 the Board of Directors make thefollowing statements to the best of their knowledge and ability:
a. That in the preparation of the annual financial statements the applicableaccounting standards have been followed along with proper explanation and that no materialdepartures have been made from the same;
b. That such accounting policies as mentioned in Notes to the Financial Statements havebeen selected and applied consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 31 2017 and of the profit or loss of the Company for the FY ended onthat date;
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 financial statements have been prepared on a going concern basis;
e. That they have laid down proper internal financial controls for the Company and suchinternal financial controls are adequate
and operating effectively;
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.
8. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL:
In accordance with the provisions of Section 152 of the Act and that of Articles ofAssociation of the Company Mr. Sanjeev Aggarwal Director of the Company retires byrotation at ensuing Annual General Meeting of the Company and being eligible has offeredhimself for re-appointment.
Further In accordance with the provisions of Section 160 of the Act the Articles ofAssociation of the Company and under Regulation 25 of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 the Board of Directors in their meeting heldon August 22 2017 appointed Mr. Rishav Aggarwal and Mr. Upendra Kamanthas AdditionalDirector to hold office up to the ensuing Annual General Meeting. The Company has receivednotice in writing from a shareholder signifying candidature of Mr. Rishav Aggarwal forappointment as a Whole-time Director of the Company and also for Mr. Upendra Kamanth forappointment as a Independent Director of the Company. The Board recommend theirappointment at the ensuing AGM.
Mr. Vijay Aggarwal and Mr. Ashok Aggarwal Whole-time Director of the Company hasresigned from their respective posts w.e.f. February 09 2017 and May 29 2017respectively. Mr. T. V. Rao Independent Director of the Company has resigned from theCompany w.e.f. July 01 2017. The Board of Directors has placed on record its warmappreciation for the rich contribution made by Mr. Vijay Aggarwal Mr. Ashok Aggarwal andMr. T. V. Rao during their respective tenures as Directors of the Company.
9. DECLARATION BY INDEPENDENT DIRECTORS:
In pursuance to the provisions of sub-section (6) of Section 149 of the Companies Act2013 and Regulation 16 of SEBI Listing Regulations each of the Independent Directors ofthe Company have submitted a declaration that each of them continues to meet the criteriaof independence as provided in the Act and the Listing Regulations.
10. NOMINATION AND REMUNERATION POLICY:
Pursuant to the provisions of Section 178 of the Act and Regulation 19 of SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 and on therecommendation of the Nomination & Remuneration Committee the Board has adoptedpolicy for selection and appointment of Directors Senior Management and theirremuneration. The details of Remuneration Policy are stated in the Corporate GovernanceReport.
11. BOARD EVALUATION:
Pursuant to the applicable provisions of the Act and SEBI Listing Regulations theBoard has carried out an annual evaluation of its own performance Board Committees andIndividual Directors and Chairperson. The evaluation process interalia considersattendance of Directors at Board and Committee Meetings acquaintance with businesscommunicating inter se board members effective participation domain knowledgecompliance with code of conduct vision and strategy etc. which is in compliance withapplicable laws regulations and guidelines. The Chairman of the respective BoardCommittees shared the report on evaluation with the respective Committee members. Theperformance of each Committee was evaluated by the Board based on the report ofevaluation received from respective Board Committees.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole.
The Chairman of the Board provided feedback to the Directors on an individual basis asappropriate. Significant highlightslearning and action points with respect to theevaluation were presented to the Board.
12. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS:
The Company's policy on directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the Corporate GovernanceReport which forms part of this Report.
13. NUMBER OF MEETINGS OF THE BOARD:
During the year ended March 31 2017 five meetings of the board were held. For detailsof the meetings of the Board kindly refer
to the Corporate Governance Report which forms part of this report.
14. NUMBER OF MEETINGS OF THE AUDIT COMMITTEE:
During the year ended March 31 2017 four meetings of the Audit Committee were held.For details of the meetings of the Audit Committee kindly refer to the CorporateGovernance Report which forms part of this report.
15. AUDITORS & AUDITORS' REPORT:
The Statutory Auditors M/s. A D V & Associates Chartered Accountants Mumbai (FirmRegistration No. 128045W was appointed in 27 Annual General Meeting to hold office fromthe conclusion of 27th Annual General Meeting for a term of consecutive five years tillconclusion of 32 Annual General Meeting (subject to ratification of the appointment by themembers at every Annual General Meeting).
The Auditors have confirmed their eligibility to the effect that the ratification oftheir appointment if made would be within the prescribed limits of the Companies Act2013 and that they are not disqualified for such appointment. The Notes on FinancialStatements referred to in the Auditors' Report are self-explanatory and do not call forany further comments.
As per Section 148 of the Act read with Rule 14 of the Companies (Audit and Auditors)Rules 2014 the Company has appointed M/s. Bhanwarlal Gurjar & Co. CostAccountants for conducting the audit of cost records of the Company for the financialyear ended on March 31 2017. The Cost Auditors' Report does not contain anyqualifications reservations adverse remarks or disclaimer.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed M/s. R L & Associates Company Secretaries (Certificate of Practice No.11472) to conduct Secretarial Audit for the financial year ended on March 31 2017.
Secretarial Audit Report issued by M/s R L & Associates Company Secretaries inForm MR-3 forms part to this report as
Secretarial Auditors observed that the Company has not appointed Independent Directorson Board of the Company pursuant to Section 149 & 177 of the Companies Act 2013 &SEBI (Listing Obligation & Disclosure Requirement) Regulations 2015. The content ofthe Report are self explanatory and does not require any further explanation on it.However the Company is in the process of appointment of Independent Director. Over aperiod of time management of the Company has interviewed several professionals to freezethis appointment but could not find a suitable person having required experience andexpertise considering nature of the industry. Management is making all its best efforts& we hope that the appointment shall be frozen shortly.
16. INTERNAL FINANCIAL CONTROLS :
The Company has in place Internal Financial Control system commensurate with sizescale and complexity of its operations to ensure proper recording of financial andoperational information & compliance of various internal controls statutorycompliances and other regulatory compliances. During the year under review no material orserious observation has been received from the Internal Auditors of the Company forinefficiency or inadequacy of such controls.
Internal Auditors' comprising of professional Chartered Accountants monitor &evaluate the efficacy of Internal Financial Control system in the Company its compliancewith operating system accounting procedures & policies at all the locations of theCompany. Based on their report of Internal Audit function corrective actions in therespective area are undertaken & controls are strengthened. Significant auditobservations and recommendations along with corrective action suggested thereon arepresented to the Audit Committee of the Board. The Company is periodically following allthe applicable Accounting Standards for properly maintaining the books of account andreporting Financial Statements.
17. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY THE COMPANY UNDER SECTION 186 :
Loans Guarantees and Investments covered under Section 186 of the Companies Act 2013form part of the Notes to the Financial Statements provided in this Annual Report.
18. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES :
All transactions entered into by the Company with related parties were in the ordinarycourse of the business and at arm's length basis and are in accordance with the provisionsof the Companies Act 2013 Rules made thereunder & Regulation 23 of SEBI
Listing Regulations. The Audit Committee grants omnibus approval for the transactionsthat are in the ordinary course of the business and repetitive in nature. For othertransactions the Company obtains specific approval of the Audit Committee before enteringinto any such transactions. A statement of all Related Party Transactions is placed beforethe Audit Committee for its review on a quarterly basis specifying the nature value andterms and conditions of the transactions.
During the financial year the Company has not entered into any materially significantrelated party transactions with its Directors Promoters Key Managerial Personnel itssubsidiaries/ associate or their respective directors or any other related party which mayhave potential conflict with interest of the Company at large. Therefore no materialrelated party transactions i.e. transactions exceeding 10% of the annual consolidatedturnover as per the latest audited financial statements were entered during the year bythe Company. Accordingly the disclosure of Related Party Transactions as required underSection 134(3)(h) of the Companies Act 2013 in Form AOC-2 is not applicable. The policyon related party transactions as formulated by the Board is available on the Company'swebsite at www.kisangroup.com.
19. SHARE CAPITAL :
The Issued Subscribed and Paid-Up Equity Share Capital as on March 31 2017 was Rs.2886.31 Lakhs. During the year under review the Company has neither issued any shareswith differential voting rights nor granted any stocks options or sweat equity and doesnot have any scheme to fund its employees to purchase the shares of the Company. As onMarch 31 2017 Mr. Sanjeev Aggarwal Chairman & Managing Director holds 653230(2.26%) equity shares & Mr. Ashok Aggarwal Whole-time Director holds 649133 (2.25%)equity shares of the Company. No other Director holds any shares in the Company. OnSeptember 21 2017 the Company allotted 7400000 Equity Shares on Preferential basis toNon-Promoter Group of the Company in compliance with the provisions of the SEBI (ICDR)Regulations due to which the issued subscribed and paid up capital of the Company gotincreased from Rs. 2146.30 to Rs. 2886.31 Lakhs.
20. EXTRACT OF ANNUAL RETURN :
As provided under Section 92(3) of the Companies Act 2013 the extract of AnnualReturn is given in "Annexure B" in the prescribed Form MGT-9 which formsan integral part of this report.
21. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The Company has strong commitment towards conservation of energy natural resources andadoption of latest technology in its area of operations. The Company is continuouslyputting its efforts to improve Energy Management by way of monitoring energy relatedparameters on regular basis viz. maximum demand power factor load factor continuouslyreplacing the inefficient equipment's with latest energy efficient technology &upgradation of equipment's continually. The information related to conservation of energytechnology absorption Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules2014 is as follows:
POWER AND FUEL CONSUMPTION:
|Electricity ||Unit ||2016-17 ||2015-16 |
|Purchased ||KWH ||27294361 ||25648375 |
|Total Amount ||Rs. In lakhs ||1602.24 ||1542.80 |
|Average Rate per unit ||Rs. ||5.87 ||6.02 |
TECHNOLOGY ABSORPTION AND RESEARCH & DEVELOPMENT (R&D):
The CAPEX plans of the Company have progressed well with several key projects eithercomplete or on the verge of completion. The Company has successfully launched the WaterTank division on March 31 2017 through its plant in Tarapur. Further machines are beinginstalled in North and South India to push the same regionally. The Pipe Automationproject of Tarapur stands completed as far as all machines related to building productsare concerned.
No technology has been imported by the Company for carrying of any of its operations.Following are the details of total foreign exchange earned and used during the lastfinancial year:
FOREIGN EXCHANGE EARNINGS AND OUTGO: Rs. in Lakhs
|Particulars ||For the year ended March 31 2017 ||For the year ended March31 2016 |
|Total Foreign Exchange earned ||207.09 ||17.69 |
|Total Foreign Exchange used ||1639.38 ||3420.95 |
22. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OFTHE COMPANY:
As per the Act and as part of good Corporate Governance the Company has laid down theprocedures to inform to the Board about the risk assessment and minimisation proceduresand the Board shall be responsible for framing implementing and monitoring the riskmanagement plan and policy for the Company. The main objective is to ensure sustainablebusiness growth with stability and to promote a pro-active approach in reportingevaluating and resolving risks associated with the business.
23. SUBSIDIARIES :
The Company has one Wholly Owned Subsidiary i.e. KML Tradelinks Private Limited.During the year the Board of Directors (the Board') reviewed the affairs of theSubsidiary. In accordance with Section 129(3) of the Act the Company has preparedconsolidated financial statements of the Company and its Subsidiary which form part ofthe Annual Report. Further a statement containing the salient features of the financialstatements of subsidiary and associate in the prescribed format are given in notes to thefinancial statements. In accordance with Section 136 of the Companies Act 2013 theaudited financial statements including the consolidated financial statements and relatedinformation of the Company and audited accounts of its subsidiary are available onwebsite of the Company www.kisangroup.com. These documents will also be available forinspection during the business hours at the registered office of the Company. TheCompany's policy on material subsidiary as approved by the Board is uploaded on theCompany's website at "Investors" Section.
24. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIALRESPONSIBILITY INITIATIVES:
As the Company does not come under the ambit of provisions related to Corporate SocialResponsibility therefore the Company has not developed and implemented any CorporateSocial Responsibility initiatives as on date.
25. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT:
In pursuance to Regulation 34 of SEBI Listing Regulation Management's Discussion andAnalysis Report for the year under review forms an integral part of this report and givesdetail of the overview industry structure and developments different product groups ofthe Company operational performance of its various business segments.
26. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:
The Company has zero tolerance towards sexual harassment at the workplace and towardsthis end has adopted a policy in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the Rules thereunder.All employees (permanent contractual temporary trainees) are covered under the saidpolicy. During the financial year under review the Company has not received anycomplaints from any of the employees of the Company.
27. PARTICULARS OF EMPLOYEES:
The prescribed particulars of Employees required under Section 197(12) of the CompaniesAct 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed herewith as "Annexure-C" to thisReport.
28. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS :
During the financial year under review no significant or material orders were passedby the Regulators or Courts or Tribunals which would impact the Company's existence goingconcern status and future operations of the Company.
29. CORPORATE GOVERNANCE REPORT :
Pursuant to Regulations 34 read with Schedule V of SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 the following forms part of this Annual Report:
Management Discussion and Analysis Report
Corporate Governance Report
Auditors' Certificate regarding compliance of conditions of Corporate Governance
The directors take this opportunity to express its gratitude and record its sincereappreciation towards its clients vendors investors Financial Institutions BankersBusiness Associates and the Government and other regulatory authorities for theircontinued support cooperation and professionalism during the year. The directors of theCompany thank all stakeholders for their valuable sustained support and encouragementtowards the conduct of the proficient operation of the Company and look forward to theircontinued support in the future. The Directors would like to place on record theirgratitude to all the employees who have continued their support during the year. Ourconsistent growth was made possible by their hardwork solidarity cooperation andsupport.
| || ||For and on behalf of the Board of Directors |
| || ||Kisan Mouldings Limited |
|Date: August 22 2017 ||Sanjeev Aggarwal ||Suresh Purohit ||Priyanka Chauhan |
|Place: Mumbai ||Chairman & Managing Director ||Chief Financial Officer ||Company Secretary |
Particulars of employees pursuant to Section 134(3) (q) of the Companies Act 2013 readwith Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 :
|Sr. No. ||Requirement under Rule 5(1) ||Details |
|1. ||Ratio of the remuneration of Managing Director & Executive Director to the median remuneration of the employees of the Company for the Financial Year. ||1 : 0.75 |
|2. ||Percentage increase in remuneration of Managing Director each Executive Director Chief Financial Officer & Company Secretary (Salary of 2016 - 17 v/s Salary of 2015 - 16). ||MD : 200%. |
| || ||ED : - 63.4 |
| || ||CFO : %. CS : - |
|3. ||Percentage increase in the median remuneration of employees in the financial year (2016 - 17 v/s 2015 - 16) ||8 - 10 % |
|4. ||Number of permanent employees as on 31st March 2017 on rolls of Company. ||948 |
|5. ||* Average percentile increase made in the salaries of employees other than the managerial personnel in last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. ||8 - 10 % |
| ||* Justification for variation in the average percentile increase between Non Managerial employees and Managerial employees. || |
|6. ||Key parameters for any variable component of remuneration availed by the Directors. ||NA |
|7. ||Affirmation that the remuneration is as per the remuneration policy of the Company. ||Yes |
|8. ||Percentage increase or decrease in the market quotations of the shares of the Company. || |
Note:- Managing Director & Executive Directors are Whole-time Directors &other Directors are Non Executive Directors who are paid only sitting fees for attendingthe Board & Committees thereof. Hence ratios provided are only for Managing Director& Whole-time Directors.
|Date: August 22 2017 ||For and on behalf of the Board of Directors |
|Place: Mumbai || |
| ||Sanjeev Aggarwal |
| ||Chairman & Managing Director |
| ||(DIN : 00064076) |