Oricon Enterprises Ltd.
|BSE: 513121||Sector: Industrials|
|NSE: ORICONENT||ISIN Code: INE730A01022|
|BSE 15:55 | 16 Mar||55.85||
|NSE 15:40 | 16 Mar||56.00||
|Mkt Cap.(Rs cr)||877|
|Mkt Cap.(Rs cr)||877.12|
Oricon Enterprises Ltd. (ORICONENT) - Director Report
Company director report
Oricon Enterprises Limited
Your Directors have pleasure in presenting the FORTY SEVENTH ANNUAL REPORT of theCompany together with the Audited Financial Statement(s) of the Company for the year endedMarch 312017.
1. Financial Results:
Rupees In Lacs
2. Financial Performance Standalone
Sales and Other Income for the year ended March 312017 amounted to Rs. 51.32 crores asagainst Rs. 85.19 crores in the previous Financial Year. Net profit for the year underreview was Rs. 4.88 Crores as against Rs. 15.82 crores in the previous FinancialYear.
The consolidated revenue for the year ended March 312017 was Rs. 1216.74 crores asagainst Rs. 1194.00 crores in the previous Financial Year. Net Profit for the year underreview was Rs. 35.28 crores as against Rs. 18.67 crores in the previous FinancialYear.
Your Directors are pleased to recommend a dividend of 23%i.e. Rs. 0.46/- per equityshare for the Financial Year 2016-17 which if approved at the forthcoming Annual GeneralMeeting will be paid to (i) the Members holding shares in physical mode and whose namesappear on the Register of Members as on July 29 2017(ii) the Members holding shares inelectronic form and who are beneficial owners of the shares as on the close of workinghours of July 18 2017 as per the details furnished by the Depository for the purpose.
4. Setting up of manufacturing plant in Odisha
The Company is setting up a unit for manufacturing Preforms in the state of Odisha.Odisha Government has already given in principle approval for the project and allotment ofLand is under its active consideration. The expected investment for the unit will be Rs.100 Crores in two phases.
5. Subsidiary Companies and Joint Venture.
Oriental Containers Limited (100%) Shinrai Auto Services Ltd (100%) Oricon PropertiesPvt Ltd (100%) United Shippers Limited (64.29%) are the subsidiaries of the Company.
A separate statement containing the salient features of financial statements of all thesubsidiaries of your Company forms part of Annual Report in the prescribed Form AOC-1 asAnnexure- I in compliance with Section 129 and other applicable provisions if any of theCompanies Act 2013.
The Financial Statements of the subsidiary companies and related information areavailable for inspection by the Members at the Registered Office of the Company during thebusiness hours on all days except Saturdays Sundays and public holidays up to the date ofthe Annual General Meeting (AGM) as required under Section 136 of the Companies Act 2013.Further in line with the SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015 and in accordance with Accounting Standard 21 (AS- 21) ConsolidatedFinancial Statement prepared by the Company includes financial information of itssubsidiaries.
The Company will provide a copy of Annual Report and other documents of its subsidiarycompanies on the request made by any Member investor of the Company/ SubsidiaryCompanies. The Financial Statements of the Subsidiary Companies have been kept forinspection by any Shareholder at the Registered Office of the Company. The statements arealso available on the website of the Company www.oriconenterprises.com
6. Transfer of Unpaid/ Unclaimed Dividend to IEPF
During the year under review Company has transferred a sum of Rs. 117934/- to theInvestor Education and Protection Fund established by the Central Government incompliance with the provisions of Section 125 of the Companies Act 2013. The said amountrepresents dividends which were declared by the Company in the financial year 2008-09 andwere lying unpaid with the Company for a period of seven years from the date of theirtransfer into unpaid dividend account.
The detailed list of shareholders whose unpaid dividend has been transferred to IEPF isuploaded on the website of the Company athttp://www.oriconenterprises.com/pdf/Transfer%20of%20Sh ares%20to%20IEPF.pdf
The Board of Directors of the Company in their Meeting held on February 01 2017 hadapproved the scheme of amalgamation of Oricon Properties Private Limited the wholly ownedSubsidiary Company with the Company subject to approval of members and various otherregulatory authorities. Also pursuant to Regulation 37 of SEBI (LODR) Regulations 2015the Company has obtained No objection certificate from Bombay Stock Exchange and NationalStock Exchange of India Limited vide their approval letter dated April 18 2017 and April19 2017 respectively.
Further the Company has filed necessary application with National Company law Tribunal(NCLT) Mumbai bench for obtaining their direction on convening meeting of members andcreditors.
8. Details of Committees of the Board:
At present the Board has following four (4) Committees:
Nomination and Remuneration Committee
Stakeholders' Relationship Committee and
Corporate Social Responsibility Committee.
The Composition of the Committees and relative compliances are in line with theapplicable provisions of the Companies Act 2013 read with the Rules and ListingRegulations. Details of terms of reference of the Committees Committees' Membership andattendance at meetings of the Committees except CSR Committee are provided in the Reporton Corporate Governance.
9. Corporate Social Responsibility Committee:
The constitution composition terms of reference role powers rights obligations ofCorporate Social Responsibility Committee [CSR Committee'] are in conformitywith the provisions of Section 135 and all other applicable provisions of the CompaniesAct 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014.
The CSR Committee consists of the following Members as on March 312017:
10. Expenditure for CSR:
During the year the Company has not spent money on Corporate Social Responsibility asthe Company was in the process of identifying and finalizing eligible projects for CSRfunding. Every effort will be made to incur CSR expenditure up to the prescribed amountduring the current Financial Year 2017-18.
The Annual report on CSR activities in accordance with the Companies (Corporate SocialResponsibility policy) Rules 2014 is set out as Annexure II forming part of this Report.
11. Policy on Directors' appointment and remuneration:
The Nomination and Remuneration Committee is entrusted with the responsibility ofidentifying and ascertaining the integrity qualification expertise and experience of theperson for appointment as Director KMP or at Senior Management level and recommendingtheir appointment for the consideration of the Board.
The Company has drawn up Nomination and Remuneration policy in line with therequirement of Section 178 of the Companies Act 2013. The Policy inter alia provides thata person should possess adequate qualification expertise and experience for the positionhe / she is considered for appointment. The Committee has discretion to decide whetherqualification expertise and experience possessed by a person is sufficient / satisfactoryfor the concerned position.
12. Vigil Mechanism / Whistle Blower Policy
The Company has a Vigil Mechanism cum Whistle Blower Policy (Vigil Mechanism') inplace. The Vigil Mechanism is a system for providing a tool to the employees of theCompany to report violation of personnel policies of the Company unethical behaviorsuspected or actual fraud violation of code of conduct. The Company is committed toprovide requisite safeguards for the protection of the persons who raise such concernsfrom reprisals or victimization.
The Policy provides for direct access to the Chairperson of the Audit Committee inappropriate or exceptional cases.
The Board of Directors affirm & confirm that no employee of the Company has beendenied access to the committee. Details of Vigil Mechanism are available on the Company'swebsite www.oriconenterprises.com
13. Risk Management
The Company has adopted a Risk Management Policy in accordance with the provisions ofthe Companies Act 2013 which laid down the framework to identify evaluate business risksand opportunities. The Company has vested powers to the Audit Committee to regulate therisk identification assessment analysis and mitigation with the assistance of theInternal Auditor. The Company has procedures in place for informing the Board of Directorson risk assessment and management procedures. Senior management periodically reviews thisrisk management framework to keep updated and address emerging challenges. The managementis however of the view that none of the risks may threaten the existence of the Companyas robust Risk mitigation mechanism is put in place to ensure that there is nil or minimumimpact on the Company in case any of these risks materialize.
14. Policy on Prevention Prohibition and Redressal of Sexual Harassment at Workplace.
The Company is committed to provide a healthy environment to all employees and thusdoes not tolerate any sexual harassment at workplace. The Company has in place Policy onPrevention Prohibition and Redressal of Sexual Harassment. The Policy aims to provideprotection to employees at the workplace and preventing and redressing complaints ofsexual harassment and it covers matters connected or incidental thereto.
The Company has not received any complaint of sexual harassment during the financialyear 2016-2017.
15. Adequacy of Internal Financial Controls with reference to the Financial Statements.
The Company has devised appropriate systems and framework for adequate internalfinancial controls with reference to financial statements commensurate with the sizescale and complexity of its operations including proper delegation of authority policiesand procedures effective IT systems aligned to business requirements risk based internalaudit framework risk management framework.
The Audit Committee regularly reviews the internal control system to ensure that itremains effective and aligned with the business requirements. In case weaknesses areidentified as a result of the reviews new procedures are put in place to strengthencontrols.
Further the Board annually reviews the effectiveness of the Company's internal controlsystem. The Directors and Management confirm that the Internal Financial Controls (IFC)are adequate with respect to the operations of the Company.
A report of the Auditors pursuant to Section 143(3) (i) of the Companies Act 2013certifying the adequacy of Internal Financial Controls is annexed with the AuditorsReport.
16. Number of Board Meetings:
Five meetings of Board of Directors were held during the financial year 2016-17. Thedetails of the Board Meeting and the attendance of the Directors are provided in theCorporate Governance Report.
17. Annual Evaluation of Board Performance
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 the performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors in theirseparate meeting who also reviewed the performance of the Board as whole.
The Nomination and Remuneration Committee has defined the evaluation criteriaprocedure for the performance evaluation of the Board of Directors.
The Board's functioning was evaluated on various aspects including inter alia degreeof fulfillment of key responsibilities Board Structure and Composition effectiveness ofBoard process information and functioning.
The Directors were evaluated on aspects such as attendance and contribution at Board /Committee Meetings and guidance / support to the management outside Board / CommitteeMeetings. In addition the Chairman was also evaluated on Key aspects of his roleincluding setting the strategic agenda of the Board encouraging active engagement of allBoard Members.
Evaluation of Independent Directors was done by the entire Board.
18. Particulars of Loans Guarantees and Investments.
Particulars of Loans Guarantees and Investment as required under Section 186 of theCompanies Act 2013 read with the Companies (Meeting of Board and its Powers) Rules 2014are given in Notes no. 11 12 and 46 forming part of Financial Statements.
19. Particulars of contracts or arrangements with related parties.
The Company does not have any contract or arrangement or transaction with related partyin terms of Section 188 of the Companies Act 2013. Hence the disclosure required to beprovided under Section 134(3) (h) of the Companies Act 2013 in Form AOC - 2 is notapplicable and need not to be furnished.
The Disclosures as required under Accounting Standard - 18 (AS-18) 'Related PartyDislcosures'' notified under Rule 7 of the Companies (Accounts) Rules 2014 has beenprovided in Note No. 27 of the notes forming part of the Financial Statements.
20. Declaration of Independent Directors
The Independent Directors have submitted their disclosures/ declarations to the Boardthat they fulfill all the requirements as stipulated in Section 149(6) of the CompaniesAct 2013 so as to qualify themselves to be appointed as Independent Directors under theprovisions of the Companies Act 2013 and the relevant rules.
21. Directors Responsibility Statement
The Board of Directors of the Company confirms:
(I) that in the preparation of the annual accounts for the year ended 31st March 2017the applicable Accounting Standards have been followed.
(ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for the year under review.
(iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the Provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) that the Directors have prepared the annual accounts for the year ended 31stMarch 2017 on a going concern' basis.
(v) that the Directors have laid down internal financial control and that such internalfinancial control are adequate.
(vi) that the Directors have devised proper system to ensure compliance with theProvisions of all applicable laws.
22. Credit Rating
Working capital facilities of the Company have been awarded CRISIL A- Stable for Longterm and CrISIL A2+ for short term rating by CRISIL which represent positive capacity fortimely payment of short term debt obligations.
23. Unclaimed Share Certificate(s).
In terms of Regulation 39(4) of Listing Regulations read with Schedule VI Company hasissued notice(s) to the shareholders for claiming unclaimed share certificate(s). Onreceipt of request from the shareholders the Company has sent share certificates to them.
The Company has initiated the procedure for transferring the shares pertaining tounclaimed share certificates to Unclaimed Suspense Account and further fordematerializing the shares.
The Members are informed that Company has opened Oricon Enterprises Limited -Unclaimed Share Certificate Suspense Account' with Depository Participant fordematerializing unclaimed share certificates and till date no shares have been creditedin the said demat account.
24. Disclosures Relating to Remuneration of Directors Key Managerial Personnel AndParticulars of Employees.
The information required under Section 197 of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is appended as Annexure III forming part of this Report.
In accordance with provisions of Section 197 of the Companies Act 2013 read with Rule5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are set out in the annexure to this report. In terms of provisions of Section 136(1) ofthe Companies Act 2013 this report is being sent to the members without this annexure.Members interested in obtaining copy of the annexure may write to the Company Secretaryand the same will be furnished on request. The said information is available also forinspection at the registered office of the Company during working hours.
25. Extract of Annual Return
In terms of Section 92 of the Companies Act 2013 read with the Companies (Managementand Administration) Rules
2014 details' forming the part of the extract of annual return is enclosed in AnnexureIV forming part of this Report.
26. Disclosure of Particulars
Information's as per the provisions of Section 134(3)(m) of the Companies Act 2013read with Rule 8(3) of the Companies (Accounts) Rules 2014 relating to Conservation ofEnergy Technology Absorption Foreign Exchange Earnings and Outgo is given in Annexure Vforming part of this Report.
27. Corporate Governance
Pursuant to Regulation 34 (3) read with Schedule V of the Securities and Exchange Boardof India (Listing Obligations and Disclosures Requirements) Regulations 2015 a Report onCorporate Governance together with a certificate obtained from M/s. GMJ & AssociatesPracticing Company Secretaries confirming compliance is given in Annexure VI forming partof this Report.
28. Management Discussion and Analysis Report
A report in the form of Management Discussion and Analysis Report is annexed hereto asAnnexure VII and forms part of this Report.
29. Directors and Key Managerial Personnel
In accordance with the requirements of the Companies Act 2013 and Articles ofAssociation of the Company Mr. Surendra Somani and Mrs. Sujata Parekh Kumar Directors ofthe Company retire at the forthcoming Annual General Meeting and being eligible offerthemselves for reappointment as Directors liable to retire by rotation.
During the year under review Mr. Kartik Athreya resigned from the Directorship of theCompany w.e.f February 03 2017.
The Board of Directors at their meeting held on May 30 2017 have appointed Mr. AdarshSomani as Joint Managing Director of the Company for 3 years w.e.f from June 012017subject to approval of members in the forthcoming Annual General Meeting except thisthere was no change in office of Director/Key Managerial Personnel of the Company.
a) Statutory Auditors
Pursuant to the Section 139(2) of the Companies Act 2013 read with rule 6 of Companies(Audit and Auditors) Rules 2014 M/s. Khandelwal Jain & Co. Chartered Accountantsretire at the conclusion of the 47th Annual General Meeting.
Pursuant to provisions of the Companies Act 2013 ('the Act'') and the Rulesframed there under it is proposed to appoint M/s. Shreyans S Jain and Associates.Chartered Accountants as Statutory Auditors of the Company for a period of 5 years i.e.to hold office from the conclusion of the 47th Annual General Meeting until theconclusion of the 52nd Annual General Meeting of the Company to be held in the Year 2022(subject to ratification of their appointment by the Members at every Annual GeneralMeeting held after the forthcoming Annual General Meeting). As required under theprovisions of Section 139(1) of the Act the Company has received a written consent andcertificate from M/s. Shreyans S Jain and Associates Chartered Accountants to the effectthat their appointment if made would be in accordance with the provisions of theCompanies Act 2013 and the Rules framed there under and that they satisfy the criteriaprovided in Section 141 of the Act.
b) Secretarial Auditor and Secretarial Audit Report
The Board has appointed M/s. GMJ & Associates Practicing Company Secretaries tocarry out Secretarial Audit under the provisions of Section 204 of the Companies Act 2013for the financial year ended 2016- 2017. The Report of Secretarial Auditor is annexed tothis Report as Annexure VIII. The report does not contain any qualification.
31. Other Disclosures/Reporting:
Your Directors further state that during the year under review:
a) no amount is transferred to General Reserve;
b) there was no change in nature of Business;
c) there was no change in Share Capital of the Company;
d) the Company has not taken any deposits from Public or Shareholders of the Company;
e) there were no significant / material orders passed by the Regulators or Courts orTribunals impacting going concern status of your Company and its operations in future;
f) there were no other material changes and commitments affecting the financialposition of the Company which have occurred between the end of the financial year of theCompany to which this financial statements relate and the date of this Report;
g) there are no qualifications reservation or adverse remark or disclaimer made by theStatutory Auditors in their Report and
h) there are no qualifications reservation or adverse remark or disclaimer made by theSecretarial Auditors in their Report.
Your Company continued to enjoy warm and healthy relations with its employees at alllocations. Your Directors take this opportunity to record their appreciation for thesignificant contribution made by the employees at all levels.
Your Directors express their deep gratitude for the cooperation and support extended tothe Company by its Members Customers Suppliers Bankers and various Government agencies.
For and on behalf of the Board