Lakhotia Polyesters India Limited.
The Directors are pleased to present the 11th Annual Report on the business andoperations of the Company and the accounts for the Financial Year ended March 31 2016.
1. FINANCIAL SUMMARY OR HIGHLIGHTS / PERFORMANCE OF THE COMPANY
The Boards Report shall be prepared based on the stand alone financial statementsof the Company.
| ||FINANCIAL YEAR |
|Particulars ||2015-16 ||2014-15 |
|Total Income ||227318607/- ||135701165/- |
|Less: Expenditure ||220060778/- ||128582832/- |
|Profit Before Finance Cost Depreciation & Tax ||7257829/- ||7118333/- |
|Less: Finance Cost ||5031700/- ||3747705/- |
|Less: Depreciation ||1553864/- ||1505178/- |
|Net Profit Before Tax & Extraordinary Item ||672265/- ||1865450/- |
|Less: Extraordinary Item ||14630000/- ||0/- |
|Less :Tax Expense ||267611 /- ||729770/- |
|Net Profit After Tax ||-14225346 /- ||1135680/- |
2. BRIEF DESCRIPTION OF THE COMPANYS OPERATIONS DURING THE YEAR/STATE OFCOMPANYS AFFAIR
During the current period of operation your company has shown an increase in therevenue to the extent of 67.51 % from Rs 1357.01Lakhs during FY 2014-15 to Rs 2273.19Lakhsduring FY 2015-16. Profit after Tax of the company has decreased to Rs 142.25 lakhs duringFY 2015-16 as compared to Rs 11.36 Lakhs during FY 2014-15.
3. FINANCIAL YEAR
This report of Directors along with its Annexure Management Discussion and AnalysisCorporate Governance Report Financial Statements along with their Notes are prepared forthe period April 01 2015 to March 31 2016 (a period of 12 months). Pursuant to theprovisions of Section 2(41) of the Companies Act 2013 a financial year inrelation to the Company means the period ending on the 31st day of March every year inrespect whereof financial statement of the Company is made. Your Company is in compliancewith the provisions of the Companies Act 2013.
4. DIVIDENDS AND RESERVES
The Company has decided to sustain the growth in line with the long term growthobjectives of the Company by retaining the profits and utilizing the same foropportunities in hand therefore the company does not recommended any dividend.
5. SHARE CAPITAL
During the period April 01 2015 to March 31 2016 during the year under review theCompany has not issued shares with differential voting rights nor has granted any stockoptions or sweat equity and there is no change in the Issued Subscribed and paid up shareCapital of Company. The Share Capital Audit as per the directives of the Securities andExchange Board of India (SEBI) is being conducted by Ranjana Mimani & AssociatesPracticing Company Secretaries. The paid up Share Capital of the Company stands at Rs.104739880/- (Rupees Ten Crores Forty Seven Lakh Eighty Thirty Nine Thousand and EightHundred and Eighty Only).
6. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Section 152 Companies Act 2013 read withapplicable Rules if any Mrs. Jayshree Lakhotia (holding DIN 05357609) retires byrotation at the ensuing Annual General Meeting and being eligible offers herself forre-appointment.
Mr. Madhusudhan Lakhotia is the Managing Director of the Company and Mr. Vivek Rathi isthe Chief Financial Officer of the Company.
Mr Harish Khajanchi ceased to be a Director with effect from 30th May 2015 and MrKrishna Jhawar ceased to be a Director with effect from 10th May 2016. Further Mr. AshokKhajanchi was appointed as Executive Director w.e.f August 17 2016.
Based on the confirmations received from Directors none of the Directors aredisqualified from appointment under Section 164 of the Companies Act 2013.
7. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the Directors Responsibility Statement referred to in clause (c) ofsub-section (3) of Section 134 of the Companies Act 2013 the Board of Directorsof theCompany state that
a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation and there are no material departures from thesame;
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 at the end of the financial year viz.March 31 2016 and of the 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 this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The Directors had prepared the annual accounts on a going concern basis; and
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 provisions ofall applicable laws and that such systems were adequate and operating effectively.
8. PUBLIC DEPOSITS
The Company has neither invited nor accepted any public deposits during the periodunder review.
9. CORPORATE SOCIAL RESPOSIBILITY :
The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as provisions of Section 135 of the Companies Act 2013 are not applicable tothe Company.
10. NUMBER OF MEETINGS OF BOARD OF DIRECTORS
During the Financial Year 2015-16 the Board of Directors of the Company met on April15 2015 May 15 2015 May 30 2015 July 03 2015 August 26 2015 September 032015 October 29 2015 December 08 2015 February 12 2016 and March 31 2016.
Frequency and quorum at these meetings were in conformity with the provisions of theCompanies Act 2013 and the SEBI (Listing Obligations and Disclosure Requirements) 2015entered into by the company with the Stock Exchanges. All the Board members and the seniormanagement personnel have affirmed compliance with the Code of Conduct during the yearended on 31st March 2016.
11. EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 as a part of this Annual Report as Annexure I.
12. PARTICULAR OF EMPLOYEES AND RELATED DISCLOSURES
Particulars of employees as required u/s 134 of the Companies Act 2013 are not annexedsince there are no employees drawing remuneration of more than Rs. 6000000/- per annumduring the year under review if employed for full year or more than Rs. 500000/- permonth if employed for part of the year.
Further the information required pursuant to Section 197 of the Companies Act 2013(the Act) read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company will be provided uponrequest. In terms of Section 136 of the Act the Report and Accounts are being sent to theMembers and others entitled thereto excluding the information on employeesparticulars which is available for inspection by the Members at the Registered Office ofthe Company during business hours on working days of the Company up to the date of theensuing Annual General Meeting. If any Member is interested in obtaining a copy thereofsuch Member may write to the Compliance Officer in this regard.
13. DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS:
All the Independent Non-Executive Directors of the Company viz. Mr. Vicky Jain Mr.Sajan Choudhary and Mr. Shailesh Mistry have submitted the declaration of independence asrequired pursuant to Section 149(7) of the Companies Act 2013 stating that they meet thecriteria of independence as laid down under Section 149(6) of the Companies Act 2013 andRegulation 16 (1) (b) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The Independent Directors have also confirmed that they have compliedwith the Companys Code of Conduct.
14. AUDIT COMMITTEE
The composition of Audit Committeeas on March 31 2016 is as follows:
|Name of Directors ||Designation in Committee ||Nature of Directorship |
|Mr. Vicky Jain** ||Chairman ||Independent Director |
|Mr. Shailesh Mistry ||Member ||Independent Director |
|Mr. Madhusudan Lakhotia ||Member ||Managing Director |
**Vicky Jain Resigned from office of Director w.e.f 24thAugust 2016
During the Financial Year 2015-16 Audit Committee met on April 15 2015 May 30 2015August 26 2015 October 29 2015 and February 12 2016.
.All the recommendations made by the audit committee we re accepted by the BoardFrequency and quorum at these meetings were in conformity with the provisions of theCompanies Act 2013 Listing Agreement and SEBI (LODR) Regulations 2015 entered into bythe company with the Stock Exchanges.
15. NOMINATION AND REMUNERATION COMMITTEE
The Company follows a policy on "Nomination and Remuneration of Directors Keymanagerial Personnel and Senior Management". The Policy adopted by the CompanysNomination and Remuneration Committee is as per Annexure II.
16. CONTRACTSAND AR RANGEMENT WITHRELATED PARTY
All Related Party Transactions are placed before the Audit Committee as also the Boardfor approval. The Company has developed a Related Party Transactions Policy for purpose ofidentification and monitoring of such transactions. Form AOC 2 is attached as AnnexureIIIto this report .
17. MANAGEMENT DISCUSSION AND ANALYSIS
As required under SEBI (LODR) Regulations 2015 with the Stock Exchanges theManagement Discussion and Analysis Report is annexed herewith the Annual Report.
18. STATUTORY AUDITORS
The Statutory Auditors of the Company are M/s. Sabadra & Sabadra CharteredAccountants having ICAI Firm Registration Number 108921W have audited the FinancialStatements of the Company for the period April 01 2015 to March 31 2016.
Pursuant to the provisions of Section 139 of the Companies Act 2013 read with Rule3(7) of the Companies (Audit and Auditors) Rules 2014 the appointment of StatutoryAuditors for the Financial Year 2016-17 needs to be ratified by the members.
The letter received from M/s. Sabadra & Sabadra Chartered Accountants also statesthat their appointment if made is as per eligibility required to be confirmed underSection 139 of the Companies Act 2013 read with the Companies (Audit and Auditors) Rules2014.
Your Directors seek ratification from the members for the appointment M/s. Sabadra& Sabadra Chartered Accountants as the Statutory Auditors of your Company from theconclusion of the ensuing Annual General Meeting till the conclusion of the 11th AnnualGeneral Meeting of the Company.
19. SECRETARIAL AUDITORS
The Board of Directors have appointed M/s R. M Mimani & Associates as SecretarialAuditors to conduct Secretarial Audit for the Financial Year 2015-16.
The Secretarial Audit Report issued by M/s R. M Mimani & Associates CompanySecretaries in Practice is self explanatory and does not call for further comments. TheSecretarial Audit Report and Management reply on Qualifications stated in the saidSecretarial report forms a part of Directors Report in Annexure IV.
20. BUSINESS RISK MANAGEMENT
The Company has a robust Business Risk Management (BRM) framework to identify evaluatebusiness risks and opportunities. This framework seeks to create transparency minimizeadverse impact on the business objectives and enhance the Companys competitiveadvantage. The business risk framework defines the risk management approach across theenterprise at various levels including documentation and reporting. The framework hasdifferent risk models which help in identifying risks trend exposure and potential impactanalysis at a Company level as also separately for business. The Company has adopted riskmanagement policy.
21. PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
I. Conservation of Energy
Your Company is continuously taking initiatives to ensure the optimum utilization ofenergy available in day to day operations. Your Company uses energy efficient lightingdevices light fittings to save energy capacitor bank / devices to maintain power factorwhich are environment and power efficient.
II. Technology Absorption
Your Company is doing its business by ensuring optimum utilization of its availableresources. Your Company has not taken any research & development activity so far.
III. Foreign Exchange Earnings and Outgo
The Company has not incurred in foreign currency during the financial year 2015-16.
22. INTERNAL FINANCIALS CONTROLS
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness were observed.
Pursuant to the provisions of the Companies Act 2013 and provisions of the ListingAgreement the Board has carried out an annual performance evaluation of its ownperformance the Directors individually as well as the evaluation of the working of itsAudit Compliance Committee Nomination and Remuneration Committee and StakeholdersRelation Committee. The manner in which the evaluation has been carried out has beenexplained in the Corporate Governance Report.
24. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has always believed in providing a safe and harassment free workplace forevery individual through various interventions and practices.
The Company always endeavours to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment. The Company has in place anAnti-Sexual Harassment Policy. Internal Complaints Committee (ICC) has been set up toredress complaints received regarding sexual harassment. All employees (permanentcontractual temporary trainees) are covered under this policy
The following is a summary of sexual harassment complaints received and disposed offduring the year 2015-16
Number of complaints received: NIL
Number of complaints disposed off: NIL
25. MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report for the year under review as stipulated underSEBI (LODR) Regulations 2015 is presented in a separate section forming part of thisAnnual Report for the year ended 31st March 2016.
26. CORPORATE GOVERNANCE
The Company is committed to maintain high standards of corporate governance and adhereto corporate governance requirement set out by SEBI. The report of corporate governance asstipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015forms an integral part of the report. The Compliance certificate from the auditors orpracticing Company Secretaries regarding compliance of conditions of corporate governanceas stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015shall be annexed with the report.
27. AUDITORS REPORT
Notes to Accounts and Auditors remarks in their report are self-explanatory and do notcall for any further comments.
28. VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Vigil Mechanism of the Company which also incorporates a whistle blower policy interms of the Listing Agreement includes an Ethics & Compliance Task Force comprisingsenior executives of the Company. Protected disclosures can be made by a whistle blowerthrough an e-mail or dedicated telephone line or a letter to the Task Force or to theChairman of the Audit Committee. The Vigil Mechanism / Whistle Blower Policy has beenuploaded on the Companys Website i.e www.lakhotiapoly.in
29. PARTICULARS OF LOANS GIVEN OR INVESTMENTS MADE
Particulars of loans given investments made along with the purpose for which the loanor guarantee or security is proposed to be utilized by the recipient are provided in thefinancial statement. (Please refer the standalone financial statement).
30. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).
31. HUMAN RESOURCES
Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invest in attraction retention and development oftalent on an ongoing basis. A number of programs that provide focused people attention arecurrently underway. Your Company thrust is on the promotion of talent internally throughjob rotation and job enlargement.
32. CODE OF CONDUCT
The Board has laid down a Code of Conduct for all Board members and senior managementpersonnel of the Company which is available on website of the company i.e.www.lakhotiapoly.in. The Company has obtained confirmations for the compliance with thesaid code from all its Board members and senior management personnel for the year endedMarch 31 2016.
33. CAUTIONARY STATEMENT
Statements in this Report Management Discussion and Analysis Corporate GovernanceNotice to the Shareholders or elsewhere in this Annual Report describing theCompanys objectives projections estimates and expectations may constituteforward looking statement within the meaning of applicable laws andregulations. Actual results might differ materially from those either expressed or impliedin the statement depending on the Market conditions and circumstances.
The Directors wish to thank and deeply acknowledge the co-operation assistance andsupport extended by the Regulatory Authorities Companys Bankers CustomersShareholders and other business constituents during the year under review.
The Directors also wish to place on record their appreciation for all roundco-operation and contribution made by employees at all levels.
| ||By Order of the Board of Director |
| ||Sd/- ||Sd/- |
|Date: September 06 2016 ||Madhusudhan Lakhotia ||Jayshree Lakhotia |
|Place: Nashik ||(Managing Director) ||(Executive Director) |