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National Oxygen Ltd.

BSE: 507813 Sector: Industrials
NSE: NOL ISIN Code: INE296D01010
BSE LIVE 12:38 | 22 Nov 43.00 1.00
(2.38%)
OPEN

42.00

HIGH

43.00

LOW

42.00

NSE 00:00 | 17 Feb Stock Is Not Traded.
OPEN 42.00
PREVIOUS CLOSE 42.00
VOLUME 167
52-Week high 49.90
52-Week low 32.00
P/E
Mkt Cap.(Rs cr) 21
Buy Price 43.00
Buy Qty 27.00
Sell Price 44.00
Sell Qty 15.00
OPEN 42.00
CLOSE 42.00
VOLUME 167
52-Week high 49.90
52-Week low 32.00
P/E
Mkt Cap.(Rs cr) 21
Buy Price 43.00
Buy Qty 27.00
Sell Price 44.00
Sell Qty 15.00

National Oxygen Ltd. (NOL) - Director Report

Company director report

Ladies and Gentlemen

Your Directors have pleasure in presenting 42nd ANNUAL REPORT of your Company togetherwith the Audited Statement of Accounts and the Auditors' Report for the Financial Yearended 31st March 2017. The summarized financial results for the Financial Year are asunder:

FINANCIAL SUMMARY

2016-2017 2015-2016
(Rs in lakh) (Rs in lakh)
Gross Profit /(Loss) (125.04) (293.60)
Depreciation (378.81) (394.35)
Profit / (Loss) before tax (503.86) (687.95)
Provision / Release of Deferred Tax 0.00 119.47
Net profit for the year (503.86) (568.48)
Balance brought forward from the earlier year (1871.23) (1302.75)
Total (2375.09) (1871.23)

PERFORMANCE AND STATE OF COMPANY'S AFFAIRS OF THE COMPANY

During the year under review the Company has incurred net loss Rs.5.04crore as againstloss of Rs 5.68crore in the previous year. The total revenue of the Company has increasedwhile comparing the previous year and hence the loss decreased .

BUSINESS OPERATIONS:

Industrial Gases

The order book position is comfortable since the Company was able to tie up long termcontracts with the customers. The plant at Pondicherry and Perundurai is also performingat its rated capacity. Your Company is working at its market front since the supply ofoxygen and nitrogen has increased compared to previous year.

Windmill

The power generation is normal and we expect the generation of power will improve inthe coming months

DIVIDEND

Considering the current and accumulated losses of your Company the Board of Directorsis not recommending any dividend for the year 2016-2017.

TRANSFER OF PROFIT TO RESERVES

During the year your company has met net loss of Rs . 5.04crore/- . Hence the questionof transfer of profit to reserve does not arise.

MATERIAL CHANGES AND COMMITMENTS OF THE COMPANY

There were no material changes and commitments affecting the financial position of theCompany between the end of financial year ( March 312017 ) and the date of the Report andthere is no significant and material orders passed by the regulators or courts or tributeimpacting the going concern status and company's operations in future.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS U/S 186:

Details of loans guarantees and investments covered under the provision of section 186of the companies act 2013 are given below:

Particulars Number Amount
Loan Given NIL NIL
Investment made-
Unquoted
Investments in
Equity Instruments
i) Pondicherry Agro 9000 shares 90000.00
Foods Pvt Ltd (Face value Rs.10/-)
ii) TCP Limited 470 shares 47000.00
(Face Value Rs.100/-)
Investment in Govt.Securities
iv) National Savings Certificate NIL 5000.00
v) Indira vikaspatra NIL 500.00
Guarantee Given Nil Nil

SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES

The Company doesn't have any subsidiaries associates and joint venture companies

THE CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

The details of conservation of energy technology absorption foreign exchange earningsand outgo as required under section 134 (3) (m) of the Companies Act 2013 are attached asAnnexure -1:

DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL (KMPs)

Board Composition and Independent Directors

The Board consists of the Executive Chairman one Executive director and threeIndependent Directors.

Independent Directors are appointed for a term of five years and are not liable toretire by rotation.

All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16(b) of the SEBI Listing Regulations.

Retirement by Rotation

Pursuant to Section 152 of the Companies Act 2013 Mr.Rajesh Kumar Saraf who retire byrotation at the forthcoming AGM and is eligible for re-appointment.

Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Companies Act 2013 the KeyManagerial Personnel of the Company are T.Sudakar Chief Financial Officer (Up to30.06.2017) P.M.Prasanth (up from 01.07.2017) and Mr.K.Venkateswaran Company Secretary& Compliance Officer as on date of signing of this report.

DECLARATION OF INDEPENDENT DIRECTORS

As per the Companies Act 2013 your company had appointed three independent directorsand they have declared that they meet the criteria of independence in terms of Section149(6) of the Companies Act 2013 and that there is no change in their status ofIndependence.

POLICY OF DIRECTORS APPOINTMENT AND REMUNERATION

Directors' appointment and remuneration including criteria for determiningqualifications positive attributes independence of a director and other matters providedunder section 178 of the Act are covered under the Board's policy formulated by theCompany.

INFORMATION U/s 197(12) OF THE COMPANIES ACT 2013

The information required under section 197 (12) of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is attachedherewith as Annexure-2.

STATUTORY AUDITORS:

The Companies Act 2013 ( ‘the Act' ) was notified effective April 1 2014.Section139 of the Act lays down the criteria for appointment and mandatory rotation of statutoryauditors. Pursuant to section 139 of the Act and rules made thereunder it is mandatory torotate the statutory auditors on completion of two terms of five consecutive years. Therules also lay down the transitional period that can be served by the existing auditorsdepending on the number of consecutive years for which an audit firm has been functioningas auditor in the same company. The incumbent auditors M/s.Singhi& Co CharteredAccountants (Firm registration number:302049e) have served the company for over 10 yearsbefore the Act was notified and will be completing the maximum number of transitionalperiod ( three years) at the ensuing 42nd AGM.

The Audit committee of the company has proposed and on May 20 2017 The Board hasrecommended the appointment of JitendraK.Agarwal& Associates Chartered Accountants (Firm registration number:318086e ) as statutory auditors of the company for the approvalof Members in the AGM.

Comment on Statutory Auditor Report

With reference to the remarks made by the Statutory Auditor regarding the erosion ofnet worth of the company The Board is of the opinion that in view of the improvedbusiness sentiments of late and reduction of cash loss compared to the previous year thecompany financials will be improved in future.

SECRETARIAL AUDITOR

Pursuant to the requirements of Section 204(1) of the Companies Act 2013 and Rule 9 ofthe Companies ( Appointment and Remuneration of Managerial Personnel ) Rule 2014 thecompany has appointed MrsLakshmmiSubramanain& Associates Practicing CompanySecretaries to conduct the secretarial audit for the financial year 2016-172017-18 and2018-19.The Secretarial Audit report as received from the secretarial auditor is annexedto this report as Annexure-3

COMMENT ON SECRETARIAL AUDIRTOR REPORT

With reference to the remarks made by the secretarial auditor Mrs. LakshmmiSubramanian Practicing Company Secretary in her secretarial audit report the companyhas taken the corrective measures during the current financial year.

INTERNAL CONTROL AND ITS ADEQUACY

The Company has in all material respects an adequate internal financial controlsystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2017 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control. The internal auditors of the Company regularly conductaudit and submit his quarterly reports which are reviewed by the Audit Committee. TheCompany has an adequate Internal Control system commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAuditor reports to the Chairman of the Audit Committee of the Board. During the year suchcontrols were tested and no reportable material weaknesses in the design or operation wereobserved.

RELATED PARTY TRANSACTIONS U/S 188 (1)

There were some transactions with Related Parties during the financial year 2016-17which were not in conflict with the interest of the Company. Suitable disclosures asrequired under AS-18 have been made in Note No.38 of the Notes to the financialstatements. Details of the transactions are provided in Form AOC-2 which is attached asAnnexure – 4

The Board had approved the Related Party Transactions which are not material as definedunder clause 23 of the SEBI LODR 2015

EXTRACT OF THE ANNUAL RETURN:

The details forming part of the extracts of Annual Return in form MGT-9 as providedunder subsection (3) of section 92 of the Companies Act is annexed herewith as Annexure-5to this report.

RISK MANAGEMENT POLICY

Your Company has an estabilished Enterprise Risk Management function that engages withall the business verticals for risk assessment ensures that the risk mitigation plansare in place and validates the risk mitigation status regularly . Action plans areincorporated into the corporate plans of your company. The steering committee consistingof core Business vertical Heads overseas the Risk Management process including riskidentification impact assessment effective implementation of the mitigation plans andrisk reporting The Committee Chaired by the Managing Director reviews on a quarterlybasis the enterprise risks to the achievement of the business objectives. The steeringCommittee updates the Risk Management committee comprising of independent directors andnon-executive director on the enterprise risks and the action taken thereon

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

Your Company has always believed in providing a safe and harassment free workplace forevery individual working in the Company through various interventions and practices. TheCompany always endeavors to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment.

The Company aims at prevention of harassment of employees and lays down the guidelinesfor identification reporting and prevention of undesired behavior. The Board of Directorsare responsible for redressal of complaints related to sexual harassment During the yearended 31 March 2017 the Board did not receive any complaints pertaining to sexualharassment.

DEPOSIT 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 date of the balancesheet.

CORPORATE GOVERNANCE REPORT

Since your company's paid up capital and Net worth is less than Rs.10 Crores and Rs.25Corers respectively the provisions of clause 27 of the SEBI LODR2015 relating toCorporate Governance vide SEBI circular dated CIR/CFD/POLICY CELL/7 is not applicable tothe Company.

BOARD MEETINGS HELD DURING THE YEAR

The Board met four times during the financial year and the intervening gap between theMeetings was within the period of 120 days as prescribed under the Companies Act 2013.

ANNUAL BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and in terms of Regulation 17(10)of the SEBI Listing Regulations the Board has carried out an annual performanceevaluation of its own performance the directors individually as well as the evaluation ofthe working of the Audit and the Nomination and Remuneration Committees.

PERFORMANCE EVALUATION OF BOARD COMMITTEE AND DIRECTORS

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of the Audit and Nomination & Remuneration Committeesand the same was based on questionnaire and feedback from all the Directors on the Boardas a whole Committees and self-evaluation.

A structured questionnaire was prepared after taking into consideration of the inputsreceived from the Directors covering various aspects of the Board's functioning such asadequacy of the composition of the Board and its Committees Board culture execution andperformance of specific duties obligations and governance. A separate exercise wascarried out to evaluate the performance of individual Directors including the Chairman ofthe Board who were evaluated on parameters such as level of engagement and contributionindependence of judgment safeguarding the interests of the Company and its minorityshareholders etc.

The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman of the Board and the Executive Directorswas carried out by the Independent Directors.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Board of Directors had adopted a Code of Conduct for the Board Members andemployees of the company. This code helps the Company to maintain the standard of businessethics and ensure compliance with the legal requirements of the company

The code is aimed at preventing any wrongdoing and promoting ethical conduct at theBoard and employees. The Compliance officer is responsible to ensure adherence to the Codeby all concerned

The code lays down the standard of conduct which is expected to be followed by theDirectors and the designated employees in their business dealings and in particular onmatters relating to integrity in the work place in business practices and in dealing withstakeholders

All the Board Members and the Senior Management personnel have confirmed compliancewith the Code

WHISTLE BLOWER POLICY/VIGIL MECHANISM

Pursuant to section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies(Meetings of Board and its Powers ) Rules2014 and clause 49 of the Listing Agreement theBoard of Directors had approved the policy on vigil mechanism / whistle blower and thesame was hosted on the website of the Company. The policy inter-alia provides a directaccess to the Chairman of the Audit Committee.

Your Company hereby affirms that no Director / employee has been denied access to theChairman of the Audit Committee and that no complaints were received during the year

BOARD COMMITTEES

The Board had constituted the following committees Viz Audit Committee Nomination andRemuneration Committee and Stakeholders' Relationship Committee

CORPORATE SOCIAL RESPONSIBILITY ( CSR )

Your company does not have profits more than Rs. 5 crores in the previous threeconsecutive financial years and current year also [31.03.2017] and therefore Constitutingof a CSR Committee and its compliance in accordance with the provisions of Section 135 ofthe Act does not arise.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:

During the year there were no such instances of significant and material orders passedby the regulators courts or tribunals.