Your Directors are pleased to present the 38th Annual Report together withthe Audited Financial Statements of the company for the Financial Year ended on 31stMarch 2017
1. FINANCIAL PERFORMANCE
| || ||(Rs. in Lakhs) |
|Particulars ||For the year ended on 31stm arch 2017 ||For the year ended on 31stm arch 2016 |
|Sales ||12115.87 ||9778.20 |
|Other Income ||31.55 ||70.45 |
|Operating Profit / (Loss) before Interest and Depreciation ||1321.51 ||1376.64 |
|Interest/ Finance Cost ||201.65 ||153.35 |
|Depreciation ||436.33 ||275.28 |
|Exceptional Items Gain/ (Loss) ||119.10 ||(2.40) |
|Profit/(loss) before tax ||802.63 ||945.62 |
|Provision for deferred tax assets (liability) ||(437.28) ||(196.20) |
|Net Profit / (Loss) ||365.35 ||749.42 |
2. PERFORMANCE AND STATE OF COMPANY AFFAIRS
Your Company has increased its production capacity to 144 TPD and plans to increase thesame substantially to 207 TPD in near future. Further your Company has also carried outmajor revamp of the ASAHI and UHDE plant for making the entire production process energyefficient.
The domestic demand for Caustic Soda in 2016-17 was around 3.92 million TPA. FurtherCaustic Soda Imports decreased by 18 % in comparison to 2015-16 resulting in bettercapacity utilization for domestic industry.
Your directors are pleased to inform you that the CIF price for caustic import has alsojumped from around $380 to $500 due to increase in demand from around the world. This willhave a positive effect on domestic prices resulting in better profitability for thecompany.
The Indian economy is growing at a healthy rate of around 7% and the pace may quickenup after some time due to better business climate being foreseen due to GST and othermeasures taken by the government.
4 FUTURE OUTLOOK
The economic parameters for the industry are looking good in the future with thegovernment giving a big push to infrastructure and make in India. Caustic and Chlorinethe products of the company are closely linked with the growth of the economy. Looking atabove factors the company is expanding capacity by installing the latest technologyproduction facilities of 70 TPD. This will result in the installed capacity of the companybeing increased to 215 TPD. The company is also planning to start a project to makederivative of Chlorine in the near future to create more value add.
5. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of the Section 152 of Companies Act 2013 read with theCompanies (Appointment and Qualification of Directors) Rules 2014 and the Articles ofAssociation of Company Shri Rakesh Ahuja Non-Executive Director is liable to retire byrotation at the ensuing Annual General Meeting (AGM) and being eligible has offeredhimself for reappointment. Appropriate resolution for his re-appointment is being placedfor your approval at the ensuing AGM. The brief resume of Director and other relatedinformation has been detailed in the notice convening the 38th AGM of yourCompany. Your Directors recommend his re-appointment as a Non-Executive Director of theCompany.
During the year under review members had approved the appointment of Shri Madhav Dhiras Whole Time director of the Company for a period of three years w.e.f. 1stJune 2016.
During the year under review Mr. Santosh Kumar has been resigned from the post ofCompany Secretary w.e.f. 31st August 2016.
The Company has received the declaration from all Independent Directors of the Companyconfirming that they meet the criteria of Independence as prescribed under the CompaniesAct 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
The First term of Independent Directors Shri Rajbir Singh Makhni Mrs. Poonam RawatShri C.S. Pathak Shri Sandeep Chaudhari Shri Shiv Dutt Sharma and Shri Pawan KumarNayyar will expire on 29th September 2017.
The Company has received declaration as required under section 152(4) of the CompaniesAct 2013 and consent to act as Director from Shri Rajbir Singh Makhni Mrs. Poonam RawatShri C.S. Pathak Shri Sandeep Chaudhari Shri Shiv Dutt Sharma and Shri Pawan KumarNayyar.
The Policy on performance evaluation of Independent Directors Board of DirectorsCommittees and other individual Directors covered the role rights responsibilities ofIndependent Director and related matters are put up on the website of the Company at thelink www.lordschloro.com.
The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company at the link www. lordschloro.com.
The following policies of the Company are attached herewith marked as Annexure A andB.
a) Policy for selection of Directors and determining directors independence; and
b) Remuneration Policy for Directors Key Managerial Personnel and other employees.
6. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS U/S 186
During the year there was no loan given investment made guarantees given orsecurities provided by the Company.
7. MATERIAL CHANGES AND COMMITMENTS IF ANY:
There were no material changes and commitments that have been occurred between the endof the financial year of the company to which the financial statements relate and thedate of signing of board report affecting the financial position of the company.
8. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
The Company has not received any significant/material orders from the statutoryregulatory bodies/courts/tribunals which affect the operations/status of the Company.
9. STATUTORY AUDITORS
At the 37th AGM of your Company the members had approved the appointment ofM/s Gupta Vigg & Co. Chartered Accountants as Statutory Auditors of the Company tohold office till the conclusion of 42ndAGM subject to ratification by the members at everyAnnual General Meeting.
The Board of Directors of your Company at their meeting held on 29th May2017 have on the recommendation of Audit Committee and subject to the approval ofmembers ratified Chartered Accountants as Statutory Auditors for the F/Y 2017-18 i.e.from conclusion of this Annual General Meeting till the conclusion of next Annual GeneralMeeting.
10. COST AUDITORS
The provisions of section 148 of the Companies Act 2013 read with Rules 4 & 5 ofthe Companies (Cost Audit and Record) Rules 2014 for maintenance of Cost Records CostAudit are applicable to the Company for the financial year 2017-18.
The Board of Directors of your Company at its meeting held on 29th May2017 have on the recommendation of Audit Committee approved the appointment of M/sGoyal Goyal & Associates Cost Accoutant as Cost Auditor of your Company to conductthe audit of cost records for the Financial Year 2017-18. The remuneration proposed to bepaid to the Cost Auditor subject to your ratification at the 38th AGM will beRs. 25000/- (Rupees Twenty Five Thousand) for the F.Y. 2017-18.
11. SECRETARIAL AUDITOR
Pursuant to the provisions of section 204 of the Companies Act 2013 and rules madethereunder the Board of Directors of the Company had appointed Shri Sundeep KumarParashar proprietor of M/s SKP & Co. Practising Company Secretary to conductSecretarial Audit of the Company for the financial year 2016-17. The Secretarial AuditReport for the financial year ended 31st March 2017 is annexed herewith markedas Annexure C to this Report.
12. AUDITORS' OBSERVATIONS
In reference to the Comments mentioned in the Statutory Auditors Report for the year2016-17 we wish to submit the following:
(i) Company has not received all the records from old management. We are in the processof reconciliation the records. We shall deposit the whole amount in the Investor Educationand Protection Fund (IEPF) as soon as records are reconciled.
During the year under review no fraud was reported by the statutory auditor of thecompany under section 143(12) of the Companies Act 2013.
13. SAFETY ENVIRONMENT PROTECTION & POLLUTION CONTROL
The company is well aware of its responsibility and obligation towards cleanenvironment for trouble free operations and society at large. The company is one of theselect few industries in India which have online data transmission and monitoring withCPCB. The company has taken effective measures to recycle water and treatment ofeffluents. The company is regularly conducting safety drills within the factory and isalso educating industries around it in industrial safety
14. DIVIDEND AND TRANSFER TO RESERVE
During the year the Company has earned a profit of Rs. 365.35 Lakhs however keepingin view the future needs expansion plans and other fund requirements your Board ofDirectors did not recommend any dividend for the financial year 2016-17 and the amount ofRs. 365.35 Lakhs has been transferred to General Reserve.
15. ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGOING.
In compliance with provisions of clause (m) of sub-section (3) of Section 134 of theCompanies Act 2013 read with the Companies (Accounts) Rules 2014 the statements givingthe required information relating to energy conservation technology absorption foreignexchange earnings and outgoings is annexed herewith as Annexure D.
16. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company has not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance withapplicable laws and as per the policy of the Company on Materiality of Related PartyTransactions.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company's website at thelink: www.lordschloro.com.
Your Directors draw attention of the members to the financial statement which sets outrelated party disclosures.
17. PARTICULARS OF EMPLOYEES & RELATED DISCLOSURES
The Industrial Relations scenario continued to be cordial. The Company regards itsemployees as a great asset and accords high priority to training and development ofemployees. Number of employees as on 31st March 2017 was 245.
Pursuant to the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 noemployee is getting salary more than Rs. Sixty Lakhs per annum.
Pursuant to the provision of Section 136 of the Companies Act 2013 the Reports andAccounts are being sent to all members of the Company excluding the information requiredin accordance with the Section 197(12) of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Anymember interested in obtaining such information may write to the Chief Financial Officerat the registered office or the corporate office of the Company.
Disclosures pertaining to remuneration and other details of Directors and KMPs areprovided in the Extract of Annual Return annexed herewith as Annexure E.
18. EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure e tothis Report.
19. PUBLIC DEPOSITS
During the year under review your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014 (including any statutory modification(s) orre-enactment(s) for the time being in force).
20. CORPORATE GOVERNANCE REPORT
Pursuant to Regulation 34 read with Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a Report on Corporate Governance and aCertificate from the Practicing Company Secretary confirming the compliance withconditions of corporate governance are appended herewith. Further as per the abovementioned regulation and Schedule the Report on Management Discussion & Analysis isalso annexed herewith to this Report.
A certificate from Managing Director and Chief Financial Officer of the Company interms of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 interalia confirmingthe correctness of financial statements and cash flow statementsadequacy of internal control measures and reporting of matters was placed before the AuditCommittee and Board.
21. RISK MANAGEMENT
The Company has constituted a Risk Management Committee which ensures that the Companyhas an appropriate and effective Enterprise Risk Management system with appropriatepolicies and processes which carries out risk assessment and ensures that risk mitigationplans are in place by validating the same at regular intervals.
Brief details about the Risk Management are provided in the Corporate GovernanceReport.
22. CORPORATE SOCIAL RESPONSIBILITY
In accordance with the provision of Section 135 of the Companies Act 2013 read withrules made thereunder Company has constituted Corporate Social Responsibility Committeewhich framed a Board approved CSR Policy for the Company same is available on Company'swebsite www.lordschloro.com.
An annual report of CSR activity has been disclosed with this report as Annexure F.
23. MEETINGS OF THE BOARD
Six meetings of the Board of Directors were held during the year. For further detailsplease refer section of Report on Corporate Governance of this Annual Report.
24. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company established a vigil mechanism for directors and employees to reportconcerns about unethical behaviour actual or suspected fraud or violation of thecompany's Code of Conduct or ethics policy.
This mechanism provides adequate safeguards against victimization of director(s) /employee(s) and also provide for direct access to the Chairman of the Audit Committee inexceptional cases.
The details of establishment of such mechanism disclosed at the website of the companywww.lordschloro.com.
25. DETAILS ON INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS
Your Company has put in place adequate internal financial controls with reference tothe financial statements some of which are outlined below.
Your Company has adopted accouting policies which are in line with the AccountingStandards prescribed in the Companies (Accounting Standards) Rules 2006 that continue toapply under Section 133 and other applicable provisions if any of the Companies Act2013 read with Rule 7 of the Companies (Accounts) Rules 2014 and other relevantprovisions of the Companies Act 1956 to the extent applicable. These are in accordancewith generally accepted accounting principles in India.
The Management periodicallay reviews the financial performance of your Company againstthe approved plans across various parameters and takes necessary action wherevernecessary.
Your Directors state that during the year under review there was no case reportedpursuant to the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013.
27. DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors state that:
a) in the preparation of the annual accounts for the year ended on 31stMarch 2017 the applicable accounting standards read with requirements set out underSchedule III to the Act have been followed and there are no material departures from thesame;
b) 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 as at the financial year ended on 31stMarch 2017 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern' basis;
e) the Directors have laid down internal financial the Company and that such internalfinancial are operating effectively; and f) the Directors have devised proper systems toensure compliance with the provisions of all applicable laws and that such systems areadequate and operating.
Your Directors wish to convey their deep appreciation to all the company'semployees/workers for their dedication and hard work as well as their collectivecontribution to the Company's performance.
The Directors would also like to thanks to the Members Customers Dealers SuppliersBankers Financial Institutions Government Authorities and all other business associatesfor continued support given by them to the Company and their confidence in its management.
| ||For and on behalf of the Board of directors |
| || ||Lords Chloro Alkali Limited || |
|Place : New Delhi ||(Ajay Virmani) ||(Yuvraj Ahuja) ||m (adhav dhir) |
|Date : 29-05-2017 ||Managing director ||Director ||Executive Director |
| ||DIN: 00758726 ||DIN: 00164675 ||DIN: 07227587 |