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KLRF Ltd.

BSE: 507598 Sector: Agri and agri inputs
NSE: KLRF ISIN Code: INE014E01015
BSE LIVE 15:40 | 26 Sep 100.65 -3.35
(-3.22%)
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NSE 00:00 | 04 Aug Stock Is Not Traded.
OPEN 100.00
PREVIOUS CLOSE 104.00
VOLUME 1400
52-Week high 122.00
52-Week low 57.60
P/E 13.17
Mkt Cap.(Rs cr) 51
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 100.00
CLOSE 104.00
VOLUME 1400
52-Week high 122.00
52-Week low 57.60
P/E 13.17
Mkt Cap.(Rs cr) 51
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

KLRF Ltd. (KLRF) - Director Report

Company director report

Dear Shareholders

The Directors present their Fifty Fourth Annual Report together with the auditedstatement of accounts for the year ended 31st March 2016.

( Rs in Lakhs)
FINANCIAL RESULTS 31.3.2016 31.3.2015
Total Turnover (Net) 20690.17 21723.91
Profit before financial charges and depreciation 1810.78 1267.21
Less : Financial charges 637.20 799.23
Profit before depreciation 1173.58 467.98
Less : Depreciation 251.56 307.06
Profit before tax 922.02 160.92
Add / Less Provision for tax - Current 187.99 32.20
- MAT credit entitlement (44.56) --
- Deferred tax assets (-) / liabilities 190.87 (44.60)
Net Profit /after tax carried to balance sheet 587.72 173.32

REVIEW OF BUSINESS OPERATIONS

During the year ended 31st March 2016 the Company has recorded a totalturnover of Rs 20690 lakhs as against Rs 21724 lakhs achieved during the previous year.The profit after tax amounted to Rs 588 lakhs as against Rs 173 lakhs in the previousyear. The Profit before Interest Depreciation Taxes and Amortization (PBIDTA) amountedto Rs 1811 lakhs as against Rs 1267 lakhs in the previous year.

There was no change in the nature of business of the Company during the financial yearended 31st March 2016.

The performance of each business segment of the Company has been comprehensivelydiscussed in the Management Discussion and Analysis Report (forming part of thisDirectors' Report)

FINANCE

Your Company continued to avail need based working capital facilities from Canara Bankand HDFC Bank Limited

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Corporate governance and Management Discussion & Analysis Report which form anintegral part of this Report are annexed to this report. The Company has complied with theconditions relating to Corporate Governance as stipulated in terms of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The Certificate from thestatutory auditor relating to the above is annexed.

SHARE CAPITAL

The paid up Equity Share Capital as on 31st March 2016 was Rs50206440/-. During the year under review the Company has not made any fresh issue ofany shares.

TRANSFER TO RESERVES

The Company has not transferred any amount to its General Reserves. However an amountof Rs 587.72 lakhs is carried forward in the Profit & Loss Account.

DIVIDEND

Your directors are unable to recommend any dividend for the year ended 31stMarch 2016.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

The Company has transferred unpaid dividend amounts within the statutory period to theIEPF. During the financial year 2015-16 unclaimed dividend of Rs 199292/- relating tothe financial year 2007 - 08 was transferred to the IEPF.

EXTRACT OF ANNUAL RETURN

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule12 of the Companies (Management and administration) Rules 2014 is furnished in Annexureand is attached to this Report.

MEETINGS

Details of the composition of the Board and its Committees namely Audit CommitteeNomination and Remuneration Committee Stakeholders Relationship Committee and of theMeetings held and attendance of the Directors at such Meetings are provided in theCorporate Governance Report which forms a part of this Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that; i. In thepreparation of the annual accounts the applicable accounting standards have beenfollowed.

ii. The Directors have selected such accounting policies and applied them consistentlyand made 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 the financial year and ofthe profit of the Company for the year under review.

iii. The Directors have taken proper and sufficient care 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. The Directors have prepared the annual accounts for the financial year ended 31stMarch 2016 on a going concern basis.

v. The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.

vi. The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

DECLARATION OF INDEPENDENT DIRECTORS

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.

REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirRemuneration. The Remuneration Policy is furnished in the Company’s website atwww.klrf.in abstract of which is furnished as "Annexure - D" and forms part ofthis report.

AUDITORS

Sri. P. Marimuthu Auditor of the Company will retire at the forthcoming annual generalmeeting and is eligible for re-appointment.

M/s Haribhakti & Co LLP Chartered Accountants branch auditors for the engineeringdivision of the Company will retire at the forthcoming annual general meeting and areeligible for re-appointment.

COST AUDITOR

The Board of Directors at its meeting held on 30th May 2016 based on therecommendation of the audit committee appointed Sri.M.Kannan Cost Accountant as CostAuditor for conducting the Cost Audit for the financial year 2016 - 2017.

As required under the provisions of Section 148 of the Companies Act 2013 necessaryresolutions seeking member's ratification for the remuneration payable to Sri.M.Kannan isincluded in the Notice convening the Fifty Fourth Annual General Meeting.

Cost audit report for the year ended 31st March 2015 has been filed beforethe time limit prescribed under the Act.

SECRETARIAL AUDIT

Pursuant to provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Sri.M.D.Selvaraj FCS Proprietor of MDS & Associates Company SecretariesCoimbatore to conduct the Secretarial Audit of the Company. The Secretarial Audit Reportis annexed herewith as "Annexure-A"

COMMENTS ON AUDITORS REPORT

There are no qualifications reservations or adverse remarks or disclaimers made by theAuditors/ Secretarial Auditor in their/ his report. There were no instances of fraudsidentified or reported by the Statutory auditors during the course of their audit pursuantto Section 143(12) of the Companies Act 2013.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS U/S 186

There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the period under review and hence the said provision is notapplicable. Details of investments made in the prior years are given in the notes 9 of thefinancial statement.

RELATED PARTY TRANSACTIONS

All transactions entered into during the financial year 31st March 2016with related parties as defined under the Companies Act and SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 were in the ordinary course of business and onan arm's length basis. During the year the Company had not entered into any transactionreferred to in Section 188 of the Companies Act with related parties which could beconsidered material under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Accordingly the disclosure of related party transactions as requiredunder Section 134(3) of the Companies Act in Form AOC-2 is not applicable. Attention ofmembers is drawn to the disclosures of transactions with related parties set out in OtherNotes on Accounts 22 (16) forming part of the financial statements.

The Company has developed a policy on related party transactions for identification andmonitoring of transactions. The policy on related party transactions as approved by theBoard is uploaded and can be accessed at company's website www.klrf.in

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY

No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year to which the financial statementsrelate and the date of this Directors' Report.

RISK MANAGEMENT

The Company has a structured risk management policy. The risk management process isdesigned to safeguard the organisation from various risks through adequate and timelyactions. It is designed to anticipate evaluate and mitigate risks in order to minimizeits impact on the business. The potential risks are inventorised and integrated with themanagement process such that they receive the necessary consideration during decisionmaking.

CORPORATE SOCIAL RESPONSIBILITY

In compliance with the provisions of Section 135 of the Companies Act 2013 and theCompanies (Corporate Social Responsibility Policy) Rules 2014 the Company hasconstituted the Corporate Social Responsibility Committee at their Board Meeting held on30th May 2016. The Committee comprises of Sri.Suresh Jagananthan Sri.SudarsanVaradaraj Sri.K.Gnanasekaran and Sri. R. Kannan as it members.

The Company has however not required to incur any expenditure on the CSR initiativesduring the year under review as the average net profits of the preceding three financialyears of the Company was negative.

BOARD EVALUATION

The Board has made a formal annual evaluation of its own performance Committees of theBoard Independent Directors and Individual Directors of the Company.

The Board's performance was evaluated based on criteria like structure governancedynamics and functioning and review of operations financials internal controls etc.

The performance of the Independent Directors as well as Individual Directors wereevaluated based on the evaluation criteria laid down under the Nomination and RemunerationPolicy and Code of Conduct as laid down by the Board.

The Committees of the Board were evaluated based on the terms of reference specified bythe Board to the said Committee. The Board of Directors were satisfied with the evaluationprocess which ensured that the performance of the Board its Committees IndependentDirectors and Individual Directors adhered to their applicable criteria.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The shareholders at the Annual General Meeting held on 16th September 2015appointed Mrs. Kalyani Balasubramanian as an Independent Director of the Company for aterm of five years.

The shareholders at the Annual General Meeting held on 16th September 2015re-appointed Sri.Suresh Jagannathan as Managing Director for a period of five years from12th March 2016.

Sri.V.N.Jayaprakasam Director is liable to retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offers himself for re-appointment. The Board recommendshis re-appointment.

KEY MANAGERIAL PERSONNEL

Key Managerial Personnel of the Company as required pursuant to Section 2 (51) of theCompanies Act 2013 are Sri. Suresh Jagannathan Managing Director Sri.R.KannanExecutive Director and Chief Financial Officer and Sri.S.Piramuthu Company Secretary

AUDIT COMMITTEE

The Audit Committee of the Board of Directors of the Company comprises three membersnamely Sri.Sudarsan Varadaraj Sri.K.Gnanasekaran and Sri.S.Govindan all of them beingIndependent Directors. Sri.Sudarsan Varadaraj an Independent Director is the Chairpersonof the Audit Committee.

The Board accepted the recommendations of the Audit Committee whenever made by theCommittee during the year.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

CONSERVATION OF ENERGY

(i) The steps taken or impact on conservation of energy

Company ensures that the manufacturing operations are conducted in the manner wherebyoptimum utilization and maximum possible savings of energy is achieved.

(ii) The steps taken by the Company for utilizing alternate source of energy

No specific investment has been made in reduction in energy consumption

(iii) The capital investment on energy conservation equipments.

As the impact of measures taken for conservation and optimum utilization of energy arenot quantitative its impact on cost cannot be stated accurately.

TECHNOLOGY ABSORPTION

Company's products are manufactured by using in-house know how and no outsidetechnology is being used for manufacturing activities. Therefore no technology absorptionis required.

EXPENDITURE INCURRED ON RESEARCH AND DEVELOPMENT

No specific expenditure of recurring or capital nature is involved in research anddevelopment directly.

FOREIGN EXCHANGE EARNINGS AND OUT GO

During the year under review your Company has earned foreign exchange of Rs 12.63lakhs and out flow of Rs 351.69 lakhs

SUBSIDIARY COMPANIES

The company does not have any subsidiary associate company or joint venture.

FIXED DEPOSITS

Your company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014. Hence thereare no unclaimed or unpaid deposits as on 31st March 2016.

DISCLOSURE UNDER SECTION 197(12) AND RULE 5(1) OF THE COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014

The requisite details relating to ratio of remuneration percentage increase inremuneration etc. as stipulated under section 197(12) and Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are annexed asAnnexure-C to this Report.

DISCLOSURE UNDER RULE 5(2) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014

The disclosure referred to the Rule 5(2) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 does not apply to the Company as there were no employeeswho are in receipt of remuneration in the aggregate at the rate of not less than Rs6000000/- if employed throughout the year or Rs 500000/- per month if employed forpart of the year.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has established a vigil mechanism for directors and employees to reporttheir genuine concerns details of which have been given in the Corporate GovernanceReport forming part of this Annual Report.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has implemented and evaluated the Internal Financial Controls which providea reasonable assurance in respect of providing financial and operational informationcomplying with applicable statutes and policies safeguarding of assets prevention anddetection of frauds accuracy and completeness of accounting records. The Internal AuditReports were reviewed by the Audit Committee. Further the Audit Committee annuallyreviews the effectiveness of the Company's internal control system. The Directors andManagement confirm that the Internal Financial Controls (IFC) are adequate with respect tothe operations of the Company. A report of Auditor’s pursuant to Section 143(3)(i) ofthe Companies Act 2013 certifying the adequacy of Internal Financial Controls is annexedwith the Auditor’s report.

LISTING

Equity shares of the Company continued to be listed on BSE Limited. During thefinancial year 2015 - 2016 your Company has entered into a new Listing Agreement with BSELimited in compliance with SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

ORDERS BY REGULATORS COURTS OR TRIBUNALS

No significant and/or material orders were passed by any regulator or court or tribunalimpacting the going concern status and the Company's operations in future.

DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND 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 &Redressal) Act 2013. Internal complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary and trainees) are covered under this policy. The Company has not received anysexual harassment complaint during the year 2015 - 2016.

ACKNOWLEDGEMENTS

Your directors acknowledge with gratitude the co-operation and assistance from itsbankers.

Your Directors would like to thank all Shareholders Customers and Employees inappreciation of their continued support.

May the Almighty Goddess Lakshmi continue to shower HER choicest blessings and continueto grant us prosperity in the years to come.

By Order of the Board
Sudarsan Varadaraj Suresh Jagannathan
Place : Coimbatore Director Managing Director
Date : 30.05.2016 DIN : 00133533 DIN : 00011326