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Nilkamal Ltd.

BSE: 523385 Sector: Industrials
NSE: NILKAMAL ISIN Code: INE310A01015
BSE LIVE 15:40 | 17 Aug 1665.95 1665.95
(%)
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HIGH

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1633.85

NSE 15:52 | 17 Aug 1665.20 61.85
(3.86%)
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LOW

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OPEN 1633.85
PREVIOUS CLOSE 0.00
VOLUME 18408
52-Week high 2274.85
52-Week low 1170.85
P/E 22.77
Mkt Cap.(Rs cr) 2,486
Buy Price 0.00
Buy Qty 0.00
Sell Price 1665.95
Sell Qty 5.00
OPEN 1633.85
CLOSE 0.00
VOLUME 18408
52-Week high 2274.85
52-Week low 1170.85
P/E 22.77
Mkt Cap.(Rs cr) 2,486
Buy Price 0.00
Buy Qty 0.00
Sell Price 1665.95
Sell Qty 5.00

Nilkamal Ltd. (NILKAMAL) - Director Report

Company director report

REPORT OF THE BOARD OF DIRECTORS TO THE SHAREHOLDERS FOR THE YEAR ENDED MARCH 31 2016.

Dear Members

Your Directors are pleased to present the 30th Annual Report and theAudited Statement of Accounts for the financial year ended March 31 2016.

FINANCIAL PERFORMANCE:

The financial performance of the Company for the financial year ended March31 2016 is summarised below:-

(Rs. in Lacs)
2015-2016 2014-2015
Gross Turnover and Other Income 201296 191896
Net Turnover and Other Income 187946 179291
Profit before Depreciation and Tax 20592 11427
Less: Depreciation on Fixed Assets 5263 5376
Profit before Tax 15329 6051
Less: Provision for Taxes 4940 1805
Profit after Tax 10389 4246
Amount Available for Appropriations 30596 21870
Less: Appropriations:
i) Interim Dividend 1045 -
ii) Proposed Final Dividend - 672
iii) Total Tax on Dividend 96 101
iv) Transfer to General Reserves 5000 890
Leaving a Balance to be carried forward 24455 20207
Earnings Per Share (Rs.) 70 28
Cash Earnings Per Share (Rs.) 105 64
Book Value per Share (Rs.) 392 330

YEAR IN RETROSPECT

During the financial year 2015-2016 your Company has recorded a gross turnover of `200376 lacs up from ` 191271 lacs of the previous financial year. Profit before Tax wasup by 153% from ` 6051 lacs to ` 15329 lacs due to softening of the raw material pricesalongwith the improved operational efficiencies. Consequently the earnings per share alsowent up from ` 28 to ` 70. The plastic business has achieved a volume growth of 3% andvalue growth of 5%.

The performance of the Company’s retail business operated under the brand name‘@home’ had witnessed an upturn achieving turnover of ` 23805 lacs which wasup by 9% vis--vis ` 21750 lacs of the previous financial year. The Company’s 16@home stores are spread PAN India in 12 cities.

RESERVES

Your Directors proposes to carry a sum of ` 5000 lacs to the General Reserve Accountout of the profits available.

DIVIDEND

During the year under review your Company had declared interim dividend twice thefirst interim dividend of ` 2.50 i.e. 25% on November 5 2015 and the second interimdividend of ` 4.50 i.e. 45% on March 14 2016 thus aggregating to ` 7.00 i.e. 70% for thefinancial year 2015-2016. Considering the aforesaid interim dividends the Company has notrecommended any final dividend for the financial year 2015-2016 on the equity shares ofthe Company.

The total outflow on account of the interim dividends (including distribution taxsurcharge and education cess) amounts to ` 1141 lacs for the financial year 2015-2016.

AWARDS AND RECOGNITIONS

Your Company constantly strives towards reducing carbon foot prints energyconservation and preserving the environment by adopting right practices for saving thescarce resources. In recognition of the same all the Company’s units have beenawarded the ISO 50001:2011 EnMS Certifications form TUV-SUD Germany.

Further with its drive to obtain Quality Management and Energy Efficiency yourCompany has achieved the First prize under the National Award for Energy Conservation fromBEE-Government of India for its Hosur Unit. Furthermore the Company has also receivedSustainability 4.0 Believer’s certificate from "Frost and Sullivans" forits Vasona Plant which certifies that the Company’s business is sustainable.

The Company also believes in giving value products to its customers and places customersatisfaction at the apex. In furtherance and recognition of this principle the Companyhas been awarded the "BIFMA Compliance certification" by the UK Certificationand Inspection Limited for its Home Office Educational and Modular Furniture range. Thiscertification assures well established QMS practices and well documented test andprocedures.

LISTING AGREEMENTS

Your Company has executed fresh Listing Agreements with BSE Limited and National StockExchange of India Limited in compliance with Regulation 109 of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 ("Listing Regulations").

CORPORATE SOCIAL RESPONSIBILITY (CSR)

In terms of the provisions of Section 135 of the Companies Act 2013 read with the CSRRules the Board of Directors of your Company has adopted a CSR Policy and the same isavailable on its website and can be accessed at http://www.nilkamal.com/Images/fckUploadedfiles/file/CSR%20POLICY.pdf.

Further in accordance with the Company’s CSR Policy the Board of Directors ofyour Company has contributed and utilized ` 199.07 lacs towards Corporate SocialResponsibility activities. The Company has expended the said sum amongst otheractivities towards promoting education providing health care and sanitation facilitiesand environmental sustainability.

The Annual Report on CSR activities is annexed herewith as "Annexure A".

Further the Company is also in the process of incorporating a Company under Section 8of the Companies Act 2013 namely ‘Nilkamal Foundation’. Your Company shall inaddition to making direct expenditure towards CSR activities shall also contribute toNilkamal Foundation for carrying out the said activities.

MATERIAL CHANGES AND COMMITMENTS

In terms of Section 134(3)(l) of the Companies Act 2013 no material changes andcommitments which could affect the Company’s financial position have occurred betweenthe end of the financial year of the Company and date of this report.

BUSINESS RESPONSIBILITY REPORT

Your Company has prepared the Business Responsibility Report (BRR) that describes theinitiatives undertaken in line with the key principles enunciated in the ‘NationalVoluntary Guidelines on Social Environmental and Economic Responsibilities ofBusiness’ framed by the Ministry of Corporate Affairs. As a Green Initiative thesaid BRR has been hosted on your Company’s website www.nilkamal.com.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT

A separate section on corporate governance practices followed by the Company togetherwith a certificate from the auditors confirming its compliance forms a part of thisAnnual Report as per SEBI Regulations. Further as per Regulation 34 read with Schedule Vof the Listing Regulations a Management Discussion and Analysis report is annexed to thisreport.

SUBSIDIARIES AND JOINT VENTURES

As on date your Company has two direct subsidiaries: Nilkamal Eswaran Plastics PrivateLimited at Sri Lanka; Nilkamal Crates and Bins – FZE at UAE and one step-downsubsidiary: Nilkamal Eswaran Marketing Private Limited at Sri Lanka; and two Joint VentureCompanies: Nilkamal Bito Storage Systems Private Limited which is the Indo-German JointVenture and Cambro Nilkamal Private Limited which is the Indo-US Joint Venture. There hasbeen no material change in the nature of business of the said Companies and the saidCompanies have shown contined profitability during the financial year 2015-16.

In terms of proviso to sub section (3) of Section 129 of the Act the salient featuresof the financial statement of the subsidiaries is set out in the prescribed form AOC-1which forms part of the Annual Report.

In accordance with third proviso of Section 136(1) of the Companies Act 2013 theAnnual Report of the Company containing therein its standalone and the consolidatedfinancial statements has been placed on the website of the Company www.nilkamal.com.Further as per fourth proviso of the said section audited annual accounts of each of thesubsidiary companies have also been placed on the website of the Companywww.nilkamal.com.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Your Company has not given any Loans or Guarantees nor has it made any Investmentscovered under the provisions of Section 186 of the Companies Act 2013.

NOMINATION AND REMUNERATION POLICY OF THE COMPANY

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy relating to remuneration of the Directors Key Managerial PersonnelSenior Management Personnel and other employees alongwith the criteria for appointmentand removal of the Directors Key Managerial Personnel and Senior Management Personnel ofthe Company. The Nomination and Remuneration Committee is fully empowered to determine/approve and revise subject to necessary approvals the remuneration of managerialpersonnel after taking into account the financial position of the Company trends in theindustry qualifications experience past performance and past remuneration etc. Thedetails of the remuneration policy are available on the website of the Companywww.nilkamal.com.The Non-Executive Directors are paid sitting fees for every meeting ofthe Board and its Committees attended by them.

AUDITORS AND AUDITORS’ REPORT

Pursuant to the provisions of Section 139 of the Companies Act 2013 M/s. B S R &Co. LLP having ICAI Registration No. 101248W/ W-100022 and M/s. Vora & Associateshaving ICAI Registration No. 111612W were appointed as the Company’s Joint StatutoryAuditors at the 28th Annual General Meeting to hold office for a period of fouryears and three years respectively subject to the ratification by the shareholders atevery subsequent Annual General Meeting.

Both M/s. B S R & Co. LLP and M/s. Vora & Associates being eligible haveexpressed their willingness to such re-appointment as the Joint Statutory Auditors. Acertificate from them has been received to the effect that their appointment as StatutoryAuditors if made would be in accordance to the provisions of Sections 139 and 141 of theCompanies Act 2013 and rules framed thereunder.

A resolution seeking ratification of their appointment forms a part of the Noticeconvening the 30th Annual General Meeting and the same is recommended for yourconsideration and approval.

The notes to accounts referred to in the Auditors’ Report are self-explanatory andtherefore do not call for any further comments.

COST AUDITOR

In conformity with the provisions of Section 148 of the Companies Act 2013 andCompanies (Cost Records and Audit) Rules 2014 the Company has appointed M/s. B. F. Modiand Associates Cost Accountants as the Cost Auditors to carry out audit of the costrecords of the Company for the financial year 2016-2017.

Mr. B. F. Modi being eligible has expressed his willingness to be reappointed as CostAuditors of the Company for the financial year 2016-2017.

The Cost Audit Report for the financial year ended March 31 2015 was filed in due timewith the Central Government (Ministry of Corporate Affairs).

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board appointedMr. Pratik M. Shah Practising Company Secretary to undertake the Secretarial Audit forthe financial year 2015-2016. The Report of the Secretarial Auditor is annexed herewith as"Annexure B".

EXTRACT OF ANNUAL RETURN

As required pursuant to Section 92(3) of the Companies Act 2013 read with Rule 12 ofthe Companies (Management and Administration) Rules 2014 the extract of the AnnualReturn in Form MGT 9 is annexed herewith as "Annexure C".

DIRECTORS

The Board of your Company is duly constituted in accordance with the requirements ofthe Companies Act 2013 read with the Listing Regulations.

In accordance with the provisions of Companies Act 2013 and the Articles ofAssociation of the Company Mr. Hiten V. Parekh (DIN: 00037550) Director of the Companyretires by rotation at the ensuing Annual General Meeting and being eligible has offeredhimself for re-election.

During the year under review with a view of overseeing the succession planning of thetop management personnel your Company had re-designated its Executive Directors. Theresolutions for their respective re-designations forms a part of the Notice convening the30th Annual General Meeting and the same is recommended for your considerationand approval.

Further all Independent Directors have given declarations that they meet the criteriaof independence as given under Section 149 of the Companies Act 2013 and the relevantprovisions of the Listing Regulations.

The required information of the Directors to be re-appointed pursuant to theprovisions of the Listing Regulations forms part of the Annual Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors confirm the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:

(a) that in the preparation of the annual accounts the applicable accounting standardshave been followed that no material departures have been made from the same;

(b) that they have selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;

(c) that they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;

(d) that the annual financial statements have been prepared on a going concern basis;

(e) that they have laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and were operating effectively;

(f) that they have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company for the financial year 2015-2016are prepared in compliance with the applicable provisions of the Act Accounting Standardsand as prescribed by Listing Regulations. The said Financial Statements have been preparedon the basis of the audited financial statements of the Company its subsidiaries andjoint venture companies as approved by their respective Boards of Directors.

ADEQUACY OF RISK MANAGEMENT SYSTEMS

The Board of Directors have adopted an Enterprise Risk Management Policy framed by theCompany which identifies the risk and lays down the risk minimization procedures. Theseprocedures are periodically reviewed to ensure that executive management controls riskthrough means of a properly defined framework.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a vigil mechanism named Whistle Blower Policy (WBP) to deal withinstance of fraud and mismanagement if any.The details of the WBP is explained in theCorporate Governance Report and also posted on the website of the Company.

REPORTING OF FRAUDS

There have been no instances of fraud reported by the Statutory Auditors under Section143(12) of the Act and Rules framed thereunder either to the Company or to the CentralGovernment.

DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013

An Internal Complaints Committee has been constituted by the Company in line with theprovisions of Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules thereunder to redress complaints received on sexualharassment. During the financial year under review the Company has not received anycomplaints of sexual harassment.

RELATED PARTY TRANSACTIONS

The Board of Directors has adopted a Policy on materiality of and dealing with relatedparty transactions. All contracts or arrangements with related parties entered into ormodified during the financial year were at arm’s length basis and in the ordinarycourse of the Company’s business. All such contracts or arrangements were enteredinto only with prior approval of the Audit Committee except transactions which qualifiedunder Omnibus approval as permitted under law. No material contract or arrangements withrelated parties were entered into during the year under review.

Your Company’s Policy on Related Party Transactions as adopted by your Board canbe accessed on the Company’s website at http://www.nilkamal.com/Images/fckUploadedfiles/file/Related Party_Transactions_Policy.pdf.

PERFORMANCE EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance itsCommittees and individual Directors pursuant to the requirements of the Act and theListing Regulations.

Further the Independent Directors at their exclusive meeting held during the yearreviewed the performance of the Board its Chairman and Non-Executive Directors and otheritems as stipulated under the Listing Regulations. The Directors were satisfied with theevaluation results which reflected the overall engagement of the Board with the Company.

STATUTORY INFORMATION

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as "AnnexureD".

In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 a statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in the said Rules areprovided in the Annexure forming part of the Annual Report.

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annexure formingpart of the Annual Report.

Having regard to the provisions of Section 136(1) read with its relevant provision ofthe Companies Act 2013 the Annual Report excluding the aforesaid information is beingsent to the members of the Company. The said information is available for inspection atthe Registered Office of the Company during working hours and any member interested inobtaining such information may write to the Company Secretary and the same will befurnished without any fee.

Your Company has not accepted Deposits from public falling within the ambit of Section73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014during the year under review.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the Regulators / Courts which wouldimpact the going concern status of the Company’s operations in future.

ACKNOWLEDGEMENTS

Your Directors wish to place on record their sincere appreciation for the encouragementand co-operation received by the Company from the Bankers State Government AuthoritiesLocal Authorities and its Employees during the year.

For and on behalf of the Board
Place: Mumbai Vamanrai V. Parekh
Date: May 14 2016 Chairman