Mahasagar Travels Limited
Your Directors have great pleasure in presenting the 24thAnnual Report together withtheir Audited Statement of Accounts of the Company for the year ended 31st March 2017.
|Particulars ||Year ended on 31.03.2017 ||Year ended on 31.03.2016 |
| ||(Rs.) ||(Rs.) |
|Total income ||556862966.31 ||490126069.58 |
|Profit or (Loss) before tax ||(905327.50) ||16356141.57 |
|Profit /(Loss) after Tax ||(905327.50) ||13256141.57 |
In view of requirements of funds the Board of Directors of the Company has shown theirinability to recommend payment of Dividend.
STATE OF COMPANY'S AFFAIRS
Since the Company is engaged in providing service to the tourists of the state andthereby in the engagement of the service sector industry since the core business of theCompany is to provide service the quality facilities and safety are the prime concern ofthe management. During the last financial year your Company has made sufficient effort toprovide better quality services through increase in the fleet capacity of the luxuriousclass. Majority of the fleet have air conditioning facility apart from comfortableinternal environment. Keeping in mind the Pollution Free Quality Concept the Company hasbeen gradually replacing in a phased manner the environment friendly Luxurious Buses inplace of old buses which would help in protecting the pollution free environment therebyputting major stress by management on the concept of taking pollution free environmentalsteps as per the Pollution Free Environment Policy of the Government and the new fleets ofbuses will also increase the tourist business and further facilitate the tourist thelatest available facilities which will increase the overall business and profitability ofthe Company in the coming years. However the management has taken care of the fluctuationin petroleum products by creating retail outlet.
During the current year the company has earned revenue of Rs. 3007.81 lacs as comparedto revenue of last year of Rs.2709.29 lacs from Travels Division and Revenue earned duringthe current year from petroleum's division is of Rs. 2496.25Lacs last year itwasRs.2131.35 lacs.
TRANSFER TO RESERVES
No amount has been transferred to General reserve Account.
EXTRACT OF ANNUAL RETURN
The extract of annual return in format MGT-9 for the financial year 2016-17 has beenenclosed with this report as annexure A1
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:
1. In the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures.
2. They have selected such accounting policies and applied them consistency and madeJudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year ended on 31stMarch 2017 and of the profit of the company for that period.
3. They 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.
4. They have prepared the annual accounts on a going concern basis
5. They have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively
6. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants and the reviews performed by management andthe relevant board committees including the audit committee the board is of the opinionthat the Company's internal financial controls were adequate and effective during thefinancial year 2016-17.
The Board of the Company has constituted a risk management committee to frameimplement and monitor the risk management plan for the Company. The committee isresponsible for reviewing the risk management plan and ensuring its effectiveness. Theaudit committee has additional oversight in the area of financial risks and controls.Major risks identified by the businesses and functions are systematically addressedthrough mitigating actions on a continuing basis.
The development and implementation of risk management policy has been covered in themanagement discussion and analysis which forms part of this report.
NUMBER OF MEETINGS OF THE BOARD
Board has met Fourteen times during the financial year the details of which are givenin the Corporate Governance Report in this Annual report. The maximum interval between anytwo meetings did not exceed 120 days as prescribed in the Companies Act 2013
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 the directors' report. Further at www.mahasagartravels.comdetailed policy is available.
Mr. Rajiv N. Mehta (DIN: 07898792) is appointed as Independent Director of the companyas per section 149(6) of Companies Act 2013. The Company has received a notice in writingfor his appointment and proposing his candidature for the office of the Director.
Pursuant to Section 152 of the Companies Act 2013 Mr. Ravi Karia (DIN: 00578672) andMr. Kartik R. Upadhyay (DIN: 02288097) Director of the Company is liable to retire at theensuing Annual General Meeting of the Company and is eligible for re-appointment. Yourdirectors recommend for their appointment.
DECLARATION OF INDEPENDENT DIRECTORS
Pursuant to the provision of Section 149 of the Act which came into effect from April1 2014 Mr. Amit G. Pande (DIN: 00684673) and Mr. Sanjay P. Mahemdavadi (DIN: 02356066)were appointed as independent director at the Annual General Meeting of the company heldon 30th September 2014.The terms and conditions of appointment of the independentdirector are as per Schedule IV of the Act. They have submitted a declaration that each ofthem meets the criteria of independence as provided in Section 149(6) of the Act and therehas been no change in the circumstances which may affect their status as independentdirector during the year.
We seek to promote and follow the highest level of ethical standard in our businesstransactions. The SEBI (Listing Obligation and Disclosure Requirement) Regulations 2015mandates the certain policies for all listed companies. All policies are available on ourwebsite(www.mahasagartravels.com) .The policies are reviewed periodically by the Board ofdirectors and update based on the need and new compliance requirement.
The Company has established a vigil mechanism to deal with instances of fraud andmismanagement if any. Detailed Vigil Mechanism policy is posted on Company's Websitewww.mahasagartravels.com) .
AUDITOR AND AUDITORS' REPORT
On the recommendation of Audit Committee pursuant of the Section 139 and otherapplicable provision if any of the Companies Act 2013 and rule made there under M/s B.H.Advani & Associates Chartered Accountants were appointed as the Statutory Auditorsin the last AGM to hold office till the conclusion of this AGM. M/s Ashish Mankad&Associates Chartered Accountant Junagadh is hereby appointed as Statutory Auditor of theCompany for their term of Five years from the Conclusion of the 24th Annual GeneralMeeting to the conclusion 29th Annual General Meeting of the Company subject torectification by the Members.
The notes forming part of accounts referred in Auditor's report are self explanatoryand provide complete information.
The Auditor's Report for F.Y. 2016-17 does not contain any qualification reservationon adverse remark. The Auditor's Report is part of this report.
The Board has appointed Mr. Kishorbhai S. Dudhatra Practicing Company Secretary toconduct the Secretarial Audit for the financial year 2016-17. The Secretarial Audit Reportfor the financial year ended March 31 2017 is annexed herewith.
AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT
The auditors' report and secretarial auditors' report does not contain anyqualifications reservations or adverse remarks. Report of the secretarial auditor isgiven as an annexure-A3 which forms part of this report.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENT
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of thebalance sheet.
TRANSACTIONS WITH RELATED PARTIES
None of the transactions with related parties falls under the scope of Section 188(1)of the Companies Act 2013. Information on transactions with related parties pursuant toSection 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014are given in Annexure A2 in form AOC-2 and the same forms are part of this report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
CONSERVATION OF ENERGY:
Since Your Company is engaged in service activity the said statement is not applicableand Company's policy is to obtain best economic average from the transportation servicesprovided by their vehicles.
Since Your Company is engaged in service activity the said statement is not applicable.Company had adopted policy to purchase latest technology transportation vehicles whichprovides maximum economic fuel average.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
The company's business activity is restricted to domestic level only and deals in rupeecurrency no any foreign currency is earned or expended.
CORPORATE SOCIAL RESPONSIBILITY:
Your company does not fall under the purview of Section 135 of companies Act 2013.Hence no Corporate Social Responsibility initiatives have been taken during the year.
PARTICULAR OF EMPLOYEES
The information required under Section 197 of the Act read with rule 5(1) of theCompanies Act (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
|Executive directors ||Ratio to median |
|BHAGCHAND GORDHANDAS SUKHWANI ||9.62:1 |
|PRAKASHBHAI KANJIBHAI KAKKAD ||6.15:1 |
b. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year
c. The percentage increase in the median remuneration of employees in the financialyear*-
The remuneration of MD & JMD is Rs. 50000 and Rs. 32000 p.m. respectively.Further company operated the buses hence most of the employees of the company are drivercategory and due to high attrition and irregular presence the salary of average employeesare around Rs. 5200/-.So in our case comparison of median salary of employee and KMP isnot comparable.
d. The number of permanent employees on the rolls of Company-
e. The explanation on the relationship between average increase in remuneration andCompany performance
On an average there is 9.57% DECREASE in the remuneration of the employees.
The increase in remuneration is in line with the market trends in the respectiveindustries. In order to ensure that remuneration reflects Company performance theperformance pay is also linked to organization performance apart from an individual'sperformance.
f. Comparison of the remuneration of the key managerial personnel against theperformance of the Company
|Aggregate remuneration of key managerial personnel (KMP) in FY15-16 ||1170000 |
|Revenue ||556862966.31 |
|Remuneration of KMPs (as % of revenue) ||0.21% |
|Profit before Tax (PBT) ||(905327.50) |
|Remuneration of KMP (as % of PBT) ||(129.24%) |
g. Variations in the market capitalization of the Company price earnings ratioas at the closing date of the current financial year and previous financial year
|Particulars ||March 31 2017 ||March 31 2016 ||% Change |
|Market Capitalization ||62829365 ||38400000 ||63.62% |
|Price Earnings Ratio || ||2.89 || |
h. Percentage increase over decrease in the market quotations of the shares of theCompany in comparison to the rate at which the Company came out with the last public offer
|Market Price (BSE) ||As per note given below |
The shares of companies are thinly traded and there is no such volumes of trading inthe scrip of the company. Company had issued shares before two decades and thereaftercompany was not in good financial conditions and the shares of the company were delistedand thereafter company made efforts to revoke the trading and since then price of thecompany's scrip is showing thin trading. Hence the data pertain to above is notcomparable.
i. Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
J. Comparison of each remuneration of the key managerial personnel against theperformance of the Company:
|Particulars ||BHAGCHAND GORDHANDAS SUKHWANI ||PRAKASHBHAI KANJIBHAI KAKKAD ||KHUSHBU NITINKUMAR SHETH |
|Remuneration in F.Y. 2016-17 ||600000/- ||384000/- ||186000 |
|Revenue || ||556862966.31 || |
|Remuneration as % of Revenue ||0.11% ||0.07% ||0.03% |
|Profit before Tax || ||(905327.50) || |
|Remuneration as % of PBT ||(66.27%) ||(42.42%) ||(20.55%) |
k. The key parameters for any variable component of remuneration availed by thedirectors: N.A.
l. The ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid directorduring the year: None
m. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company affirms remuneration is as per the remuneration policy of the Company.
The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI ListingRegulations")
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Remuneration & Nomination Committee reviewed the performance ofthe individual directors on the basis of the criteria such as the contribution of theindividual director to the Board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the Chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent Directors performance of non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual directors was also discussed.
Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013
All the assets of the Company have been adequately insured.
At present your Company's Securities are listed on the Bombay Stock Exchange Limited.Company had passed necessary resolution for Voluntary Delisting of its Equity shares fromAhmedabad Stock Exchange Ltd. and Saurashtra Kutch Stock Exchange Limited (SKSE).
Company is regularly paying Income Tax Sales Tax RTO Tax and other statutory dueslike Provident Fund ESIC as applicable. As regard to Service Tax appropriate provisionand treatments have been as per Law. Details of the payment refund appeals and disputedamount have been adequately provided in audit report and same is self -explanatory and theamount of dispute is being dealt with various authorities and awaiting for final outcome.
DEMATIRIALIZATION AND TRANSFER OF THE SECURITIES:
ISIN: INE 007G01014
As on date of this report company is having NSDL connectivity of dematerialization ofshares and efforts are being made to have CDSL connectivity.
REGISTRAR AND SHARE TRANSFER AGENT
Link Intime Pvt. Ltd. (Unit: Mahasagar Travels Limited)
506-508 Amarnath Business Centre-1 ABC-1 Beside Gala Business centre
Near St. Xavier's Collage Corner off C G Road
Navrangpura Ahmedabad -380009
(1) In conformity with the provision of Regulation 34 of the Listing regulation thecash flow statement for the year ended on 31st March 2017 is annexed to the accounts.
Information pursuant to Section 197(12) of the Companies Act 2013 read with Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isattached as Annexure A3
The Company has complied with the requirement regarding corporate governance as perListing Obligation and Disclosure Requirement (LODR) Regulation 2015 and stock exchangewhere the Company's shares are listed. A report on the Corporate Governance in this regardis made a part of this Annual Report and a Certificate from the Auditor of the Companyregarding Compliance of the Conditions of the Corporate Governance is attached to thisreport and forming part this report.
MANAGEMENT DISCUSSION AND ANALYSIS:
1. INDUSTRY OUTLOOK:
Travel and tourism industries are being promoted by government. Gujarat Government isactively promoting tourism facilities and destinations in the state. With the increase intravelling tendency of people for the leisure and business overall industry is viewinggood prospects.
2. OPPORTUNITIES AND THREATS:
Government of Gujarat is promoting tourism in all spheres. Further medical tourism anddevelopment of infrastructure facilities have made Gujarat a tourist destination. Sincethe Company has started business in real estate sector petroleum sector and been engagedin to the service sector the main concern of the management is to provide best qualityservices to the customer. Safety discipline as to the timing comfort is the mainparameters. Government policies and regional policies can affect the performance of thecompany. New players are joining in the competition. Company is planning to develop morearea related to tourism hotel business and infrastructure facilities and in construction& real estate fields.
International market is very volatile nowadays with respect to petroleum products andreal estate sector in India facing many challenges for the new development.
Change in crude oil price and fluctuation in currency plays a vital role in theprofitability of the company
As we know that the customers are becoming more quality conscious which calls forcontinuous up gradation in the available methods and the technology deployed which willyield better realization to the company. Another niche for the Company is to maximumutilization of the Parcel business which can earn maximum revenues to the company at anegligible cost. Growing competition and drastic change of the life style of the peoplethereby to constantly make better quality service to satisfy the need of people is theconcern of the management.
Company is planning to grab infrastructure development opportunities related to realestate travel and tourism.
4. RISKS AND CONCERNS:
Company is in travel business and major fluctuation in the price of the petroleumproduct is having vital impact on the profitability and performance. International markethaving great effect on increase in the crude price and increase in dollar value againstthe rupee is also a matter of concern.
Realty sector in India has shown some slow movements market is becoming steadier andhigher inflation rate leads government to curb financial resources to realty sector.
To mitigate the risk of increase in petroleum products company had mainly two optionseither to increase the price of services offered or to make optimum utilization ofresources.
5. INTERNAL CONTROL SYSTEM:
The Company has adequate system of control implemented by the management towardsachieving efficiency in the operation optimum utilization of resources and effectivemonitoring thereof and compliance with applicable laws
6. HUMAN RESOURCES:
The Company attaches priority to human resources development with focus on regular upgradation of the knowledge and skills of our employees and equipping them with thenecessary expertise to meet the challenges of change and growth successfully.
The Directors sincerely express their appreciation to the employees at all levelsBankers customers investors Government of Gujarat and Ministry of Government for theirsustained support and cooperation and hope that the same will continue in future.
|Date : 29-05-2017 ||For and On behalf of the Board |
|Place : Junagadh ||Bhagchand Sukhwani / Prakash Kakkad |
|Registered Offfce : ||(DIN:00579112) / (DIN: 02355435) |
|Mahasgar House ||Managing Director / Jt. Managing Director |
|Jayshree Talkies Road || |
|Kalwa Chowk Junagadh . || |
CEO / CFO CERTIFICATION
(Regulation 17(8) of SEBI LODR)
The Board of Directors
Mahasagar Travels Limited
We Bhagchand Sukhwani Managing Director & CEO and Prakash Kakkad Jt. ManagingDirector and - Chief Financial Officer of Mahasagar Travels Limited hereby certify that:
A) We have reviewed Financial Statements and the Cash Flow Statement for the FinancialYear ended March 31 2017and that to the best of our knowledge and belief:
i) These statements do not contain any materially untrue statement or omit any materialfact or contain statements that might be misleading;
ii) These statements together present a true and fair view of the Company's affairs andare in compliance with existing accounting standards applicable laws and regulations.
B) There are to the best of our knowledge and belief no transactions entered into bythe Company during the year which are fraudulent illegal or volatile of the Company'scode of conduct.
C) We are responsible for establishing and maintaining internal controls for financialreporting and that we have evaluated the effectiveness of the internal control systems ofthe Company pertaining to financial reporting and we have disclosed to the Auditors andthe Audit Committee deficiencies in the design or operation of such internal controls ifany of which we are aware and the steps we have taken or propose to take to rectify thesedeficiencies.
We have indicated to the Auditors and the Audit committee that;
i). there have been no significant changes in internal control over financial reportingduring the year;
ii). there have been no significant changes in accounting policies during the year; and
iii). there have been no instances of significant fraud of which we have become awareand the involvement therein if any of the management or an employee having a significantrole in the Company's internal control system over financial reporting.
|Bhagchand G.Sukhwani ||Prakash K Kakkad |
|Managing Director & CEO ||Jt.Managing Director / CFO |
|DIN: 00579112 ||DIN: 02355435 |
|Place : Junagadh || |
|Date : 29-05-2017 || |
DECLARATION OF MANAGING DIRECTOR
Pursuant to the Regulation 34 53 read with Schedule V of the SEBI (Listing Obligationand Disclosure Requirements) Regulations it is hereby declared that all the Board Membersand Senior Management Personnel of Mahasagar Travels Limited have affirmed compliance withthe code of conduct for Directors and Senior Management for the Financial Year ended onMarch 31 2017.
|Bhagchand G.Sukhwani ||Prakash K Kakkad |
|Managing Director & CEO ||Jt.Managing Director / CFO |
|DIN: 00579112 ||DIN: 02355435 |
|Place : Junagadh || |
|Date : 29-05-2017 || |