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Linc Pen & Plastics Ltd.

BSE: 531241 Sector: Services
NSE: LINCPEN ISIN Code: INE802B01019
BSE LIVE 15:29 | 22 Aug 244.05 -2.25
(-0.91%)
OPEN

246.00

HIGH

249.35

LOW

244.00

NSE 15:31 | 22 Aug 244.20 -0.45
(-0.18%)
OPEN

245.10

HIGH

247.05

LOW

244.10

OPEN 246.00
PREVIOUS CLOSE 246.30
VOLUME 277
52-Week high 338.95
52-Week low 220.05
P/E 20.97
Mkt Cap.(Rs cr) 361
Buy Price 244.05
Buy Qty 31.00
Sell Price 248.90
Sell Qty 42.00
OPEN 246.00
CLOSE 246.30
VOLUME 277
52-Week high 338.95
52-Week low 220.05
P/E 20.97
Mkt Cap.(Rs cr) 361
Buy Price 244.05
Buy Qty 31.00
Sell Price 248.90
Sell Qty 42.00

Linc Pen & Plastics Ltd. (LINCPEN) - Director Report

Company director report

Your Directors have pleasure in presenting their 22nd Annual Report together with theaudited accounts of the Company for the year ended 31st March 2016.

Financial Highlights (Rs. in Lacs)
2015 – 16 2014 – 15
Sales & Other Operational Income 34414.43 31830.27
Other Income 73.84 28.74
Profit before depreciation interest and taxation 3213.08 2555.38
Finance Cost 153.04 148.43
Depreciation 596.36 585.98
Profit before Tax 2463.68 1820.97
Provision for Taxation – Current 541.00 385.00
- Deferred 90.68 (13.97)
- Income Tax for earlier years - 17.53
Profit after Tax 1832.00 1432.41
Add: Credit Balance of the previous year 381.96 393.12
Amount available for Appropriation 2213.96 1825.53
Transfer to General Reserve 1200.00 1000.00
Proposed Dividend 443.58 369.65
Corporate Tax on Dividend 90.30 73.92
Balance carried to Balance Sheet 480.08 381.96

Dividend

Your Directors recommend a Dividend of H3/- per equity share (previous year H2.50 perequity share) for the year ended 31st March 2016.

Financial Performance

Sales & Net Profit: During the year under review the Company’s Sales(incl. Other Operational Income) increased by 8.1% to H34414.43 Lacs as compared toH31830.27 Lacs during the preceding year. The Company spend H1153.74 Lacs (3.4% of Sales)on Advertisement & Promotion in 2015-16 as compared to H946.40 Lacs (3.0% of Sales) in2014-15. The Profit after Tax during the year was H1832 Lacs as compared to H1432.41 Lacsin the previous year a jump of about 27.9%.

The profitability improved in 2015-16 helped by 8.1% increase in revenue of theCompany backed by 11.3% increase in exports.

Working Capital: The year-end debtors are 51 days of the sales for the year ascompared to 46 days in the previous year mainly on account of 29.6% growth in export in4th quarter of 2015-16. The inventory holding is for 82 days’ sales as compared to 73days in the previous year.

A full analysis and discussion on the performance of the Company as well businessoutlook is included in this Annual Report under the heading ‘Management Discussionand Analysis’ as Annexure to this Report.

New Facility at Umbergaon Gujarat

The Company is planning to set-up a new production facility at Umbergaon Gujarat.Pending finalisation of full plan the Company has started civil construction at the site.

Directors’ Responsibility Statement

Pursuant to Section 134(5) of the Companies Act 2013 the Directors hereby confirmthat:-

(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

(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 and ofthe 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;

(e) the directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively; and

(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

Corporate Governance

The Company had complied with the requirements of Corporate Governance in terms ofClause 49 of the Listing Agreement with Stock Exchanges or SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. A separate report each on Corporate Governance(Annexure-B along with Auditors’ Certificate on its due compliance) and ManagementDiscussion and Analysis is attached to this report.

Listing

The equity shares of the Company are listed on BSE Limited (BSE) The Calcutta StockExchange Limited (CSE) and National Stock Exchange of India Limited (NSE).

Directors and Key Managerial Personnel

Pursuant to the provision of the Companies Act 2013 the appointment of Dr. RanjanDas Shri Naresh Pachisia Shri Kedar Nath Ranasaria and Shri Anil Kochar as IndependentDirector under section 149 of the Companies Act 2013 for a term of 5 years w.e.f. 29thAugust 2014 were approved by the shareholders at their meeting held on 29th August 2014and the appointment of Ms. Supriya Newar as Independent Director under section 149 of theCompanies Act 2013 for a term of 5 years w.e.f. 3rd September 2015 was approved by theshareholders at their meeting held on 3rd September 2015.

In accordance with the Articles of Association of the Company Shri Aloke Jalan WholeTime Director of the Company retire by rotation at the ensuing Annual General Meeting andbeing eligible offer himself for re-appointment.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings & Outgo

A statement pursuant to section 134 of the Companies Act 2013 giving details ofmeasures taken towards conservation of energy technology absorption foreign exchangeearnings and outgo in accordance with the Companies (Accounts) Rules 2014 is annexed asAnnexure - C.

Particulars of Employees and related disclosures

Disclosure as required Section 197(12) of the Companies Act 2013 read with Rule 5(1)5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is annexed as Annexure – D.

Policy on Directors’ Appointment and Remuneration

Policy on Directors’ Appointment is to follow the criteria as laid down under theCompanies Act 2013 the Listing Agreement with Stock Exchanges Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 andgood corporate practices. Emphasis is given to persons from diverse fields or professions.

Policy on Remuneration - Guiding Policy on remuneration of Directors Key ManagerialPersonnel and employees of the Company is –

• Remuneration to unionised workmen is based on the periodical settlement with theworkmen union.

• Remuneration to Key Managerial Personnel Senior Executives Managers Staff andWorkmen (non Unionised) is industry driven in which it is operating taking into accountthe performance leverage and factors such as to attract and retain quality talent.

• For Directors it is based on the shareholders resolutions provisions of theCompanies Act 2013 and Rules framed therein circulars and guidelines issued by CentralGovernment and other authorities from time to time.

Declaration by Independent Directors

Pursuant to Section 149(6) of the Companies Act 2013 Independent Directors of theCompany have made a declaration confirming the compliance of the conditions of theindependence stipulated in the aforesaid section.

Related Party Transactions

All related party transactions that were entered into during the year under report wereon an arm’s length basis and in the ordinary course of business. There are nomaterially significant related party transactions made by the Company during the year.Related Party Transactions Policy is available on weblink http://www.lincpen.com

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 minimiseits impact on the business. The potential risks are inventorised and integrated with themanagement process such that they receive the necessary consideration during decisionmaking. It is dealt with in greater details in the management discussion and analysissection.

Annual Evaluation by Board

The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and adequate and meets the requirement of the Company.

Whistle Blower Mechanism

Your Company has put in place Whistle Blower Mechanism. The detailed mechanism is givenin Corporate Governance Report forming part of this report.

Extract of Annual Return

Extract of Annual Return is annexed as Annexure – E.

Meeting of the Board of Directors

Five (5) meeting of the Board of Directors including a meeting of IndependentDirectors without the attendance of the Non-Independent Directors and members ofmanagement were held during the year. The details of the same are provided in theCorporate Governance Report.

Auditors

Your Directors request you to appoint Auditors for the Current Financial Year.

Secretarial Audit

The Company had appointed M/s D. C. Sahoo & Co. Practising Company Secretaries asthe Secretarial Auditor of the Company for the financial year 2015-16. The report of theSecretarial Auditor is annexed as Annexure – F. The report does not contain anyqualification.

Internal Financial Control

The Company has put in place adequate system of internal financial controlscommensurate with its size and nature of its operations. During the year no materialweakness in its operating effectiveness was observed.

Corporate Social Responsibility

With the enactment of the Companies Act 2013 and the Companies (Corporate SocialResponsibility) Rules 2014 read with various clarifications issued by Ministry ofCorporate Affairs the Company has undertaken activities as per the CSR Policy and thedetails are contained in the Annual Report on CSR activities given in Annexure - G formingpart of this report.

The amount required to be spent on CSR activities during the year under review inaccordance with the provisions of Section 135 of the Companies Act 2013 is H26.65 Lacsand the company has spent H10.72 Lacs during the current financial year. The spending wasless as the Company wanted to utilise the funds in justifiable sustainable and measurableactivities. The shortfall in the spend during the year under review is intended to beutilised in future on projects within the Company’s CSR Policy.

Further as a responsible corporate citizen the Company had been involved in CSRactivities since its inception. Some of these activities will not fall under 2% CSR spendas per Schedule VII read with Section 135 of the Companies Act 2013. But the Companydecided to continue with them since those activities are integral to the business of theCompany.

Acknowledgement

Your Directors express their appreciation to all the employees for their valuablecontribution. Your directors also wish to express their gratitude for the continuedco-operation support and assistance provided by all the valued Channel PartnersDistributors Suppliers Bankers Shareholders the Central and State Governments.

For and on behalf of the Board
Deepak Jalan Aloke Jalan
Place : Kolkata Managing Director Whole Time Director
Dated : 24th May 2016 Din: 00758600 Din:00758762