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Pasupati Acrylon Ltd.

BSE: 500456 Sector: Industrials
NSE: PASUPTACRY ISIN Code: INE818B01023
BSE LIVE 10:53 | 18 Aug 24.00 0.05
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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 24.00
PREVIOUS CLOSE 23.95
VOLUME 20360
52-Week high 38.65
52-Week low 20.55
P/E 8.70
Mkt Cap.(Rs cr) 214
Buy Price 23.85
Buy Qty 526.00
Sell Price 24.00
Sell Qty 406.00
OPEN 24.00
CLOSE 23.95
VOLUME 20360
52-Week high 38.65
52-Week low 20.55
P/E 8.70
Mkt Cap.(Rs cr) 214
Buy Price 23.85
Buy Qty 526.00
Sell Price 24.00
Sell Qty 406.00

Pasupati Acrylon Ltd. (PASUPTACRY) - Director Report

Company director report

To the Members

Your Directors have pleasure in presenting Annual Report of the Company together withthe Audited Accounts for the year ended on 31st March 2016.

FINANCIAL RESULTS

Salient financial results during the year under review as compared to the previous yearare mentioned below:-

(Rs./ Crores)

2015-16 2014-15
Sales (Gross) & Other Income 588.91 595.24
Profit before Interest & Depreciation 61.25 40.19
Financial Charges 6.31 7.62
Depreciation 7.43 7.32
Profit / (Loss) before Taxes 47.51 25.25
Tax Expenses for the year :-
- Current Tax (0.61) (0.32)
- Deferred Tax Assets (13.90) (6.89)
Exceptional Items (3.07) (3.47)
Profit /(Loss) after Taxes 29.93 14.57

The Directors do not recommed dividend for the year.

RESULTS OF OPERATIONS AND STATE OF COMPANY’S AFFAIRS

The Company has recorded a production of 41616 MT and Sale of 41616 MT during the yearunder review as against 33628 MT and 32148 MT respectively during the previous year i.e.an increase of 24% and 29% respectively. However the gross turnover was Rs.582 Crore asagainst Rs.587.52 Crore in the previous year. The turnover does not increase incommensurate with sales quantity as the raw material during the year saw downward trenddue to softening of crude prices consequently sales realization per unit was less thanthe previous year though margins have improved.

In order to de-risk business it is decided to diversify into manufacturing of CastPoly Propylene Film. The Company is in the process of installing integrated CPP Film plantof 5000 TPA at existing site.

CDR EXIT

Company’s CDR tenure ended on 31.03.2016. The Company has paid entire debtrestructured under CDR as envisaged in the Scheme

EXPORTS

The Company’s exports continue to grow at a healthy pace during the year underreview company’s exports were of 12769 MT as compared to previous year of 7904 MTi.e. an increase of 62%.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

a) Industry Structure and Development

The Demand of Acrylic Fibre during the year has improved; the company sold 41616 MTduring the year under review as compared to 32148 MT during the previous year. Duringfirst quarter of current financial year demand continues to be good and it is expectedthat during the remaining period momentum would sustain.

b) Opportunities and Threat

Principal raw material i.e. A C N is a by-product of crude oil. During the year underreview prices of crude oil fallen while it is now stabilizing in the band of 50 USD perbarrel as such it is expected that A C N prices would also move in a narrow band. Sinceit is being imported the fluctuation in foreign exchange i.e. USD vs. INR has a bearingon the margin of the Company.

c) Segment-wise / Product-wise performance

The Company has only one segment i.e. Acrylic Fibre.

d) Risk and Concern

Since Company is dependent upon imported raw materials as such sudden movement in USDand volatility in crude oil adversely affects the margin. To de-risk the company isincreasing thrust on exports; company’s exports were about 30% of sales.

DIRECTORS

As per terms and conditions of appointment Shri Rakesh Mundra Director retires in theforthcoming Annual General Meeting and being eligible offers himself for re-appointment.

All independent Directors have declared that they meet the criteria of independence aslaid down under Section 149 (6) of the Companies Act 2013 and Regulation 40 of the SEBI(Listing Obligation and Disclosure Requirements) Regulations 2015 of the ListingAgreement with Stock Exchanges.

KEY MANAGERIAL PERSONNEL

As required under Section 203 of the Companies Act 2013 the Company has noted thatMr. Vineet Jain Managing Director and Mr. Rakesh Mundra Director (Finance) & CompanySecretary are the Key Managerial Personnel of the Company.

NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration.

The Nomination and Remuneration Policy is stated in the Corporate Governance Report.

EVALUATION OF BOARD PERFORMANCE

The Board carried out an annual evaluation of its own performance of each Board Memberindividually as well as the working of its committees.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 134(3) (c) of the Companies Act 2013 yourDirectors to the best of their knowledge and belief and according to the information andexplanations obtained by them hereby confirm:

a) That in the preparation of the annual accounts for the financial year ended 31stMarch 2016 the applicable accounting standards had been followed along with properexplanation relating to material departures;

b) That the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are 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 ended 31st March 2016 and of the profit of the company for theyear ended on that date;

c) That the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;

d) That the directors had prepared the annual accounts on a going concern basis;

e) That the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively;

f) That the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

CORPORATE GOVERNANCE

The company has complied with the Corporate Governance code as stipulated under thelisting agreement executed with the Stock Exchanges. A separate section on CorporateGovernance along-with a certificate from the auditors of the Company is annexed and formspart of this Report

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

None of the transactions with any of the related parties were in conflict with yourcompany’s interest. Attention of members is drawn to the disclosure of transactionswith related parties set out in Note No.34 of the Financial Statements forming part ofthis Annual Report. All related party transactions are negotiated on arm’s lengthbasis.

DISCLOSURE UNDER SEXUAL HARRASSMENT OF WORMEN AT WORK PLACE

The Company has in place requisite Internal Committees as envisaged in the SexualHarassment of Women at workplace (Prevention Prohibition and Redressal) Act 2013.

No complaints on issues covered by the above act were received during the year.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There were no significant and material orders passed against your Company by theregulators or courts or tribunals during the FY 2015-16 impacting the going concern statusand your Company’s operations in future.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your directors have constituted the Corporate Social Responsibility Committee (CSRCommittee).The said Committee has been entrusted with the responsibility of formulatingand recommending to the Board a Corporate Social Responsibility Policy (CSR Policy)indicating the activities to be undertaken by the Company monitoring the implementationof the frame work of the CSR Policy and recommending the amount to be spent on CSRActivities.

RISK MANAGEMENT

During the year your Directors have constituted a Risk Management Committee which hasbeen entrusted with the responsibility to assist the Board to overseeing and approving theCompanies Risk Management framework and all the risks that the company faces such asstrategic financial credit market liquidity security property IT legalregulatory reputational and other risks have been identified and assessed and there is anadequate risk management.

INTERNAL FINANCIAL CONTROL

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportable materialweakness in the design or operation was observed.

AUDITORS AND AUDITORS REPORT

Statutory Auditors

M/s. B. K. Shroff & Co. Chartered Accountants New Delhi Statutory Auditors ofthe Company hold office till the conclusion of the ensuing Annual General Meeting and areeligible for reappointment. They have confirmed their eligibility to the effect that theirreappointment if made would be within the prescribed limits under the Act and that theyare not disqualified for re-appointment. The notes on financial statement referred to inthe Auditors Report are self-explanatory and do not call for any further comments. TheAuditors report does not contain any qualification reservation or adverse remark.

Cost Audit

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit)Rules 2014 your Directors on the recommendation of the Audit committee appointed M/s.Satnam Sigh Saggu Cost Accountants as Cost Auditors of your company for the FinancialYear 2016-17 to carry out the cost audit for the applicable business on a remuneration ofRs.40000/- (Rupees forty thousand only) plus applicable taxes and reimbursement of out ofpocket expenses. A certificate from M/s. Satnam Sigh Saggu Cost Accountants has beenreceived to the effect that their appointment as Cost Auditors of the Company if madewould be in accordance with the limits specified under Section 141 of the Act and Rulesmade thereunder.

As required under the Act the remuneration payable to the Cost Auditor is required tobe placed before the members of the Company in the general meeting for ratification.Accordingly the Board of Directors of the Company seek members’ ratification for theremuneration payable to M/s. Satnam Sigh Saggu Cost Accountants for the FY 2016-17 atthe ensuing Annual General Meeting.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyappointed M/s. V.K. Sharma & Co Practicing Company Secretaries to undertakeSecretarial Audit for the financial year 2015-16. The Secretarial Audit Report for theFinancial Year ended 31st March 2016 is annexed herewith to this Report.

The Secretarial Audit Report as annexed is self-explanatory and do not call for anyfurther comments.

DISCLOSURES:

Audit Committee

Company has an Audit Committee of the Board of Directors in place. The terms ofreference of the Audit Committee are in line with Section 177of the Companies Act 2013read with Companies (Meetings of Board and its Powers) Rules 2014 and SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 Detailed information pertainingto Audit Committee has been provided in the Corporate Governance Report which forms partof this Annual Report. All recommendations made by the Audit Committee were accepted bythe Board.

Vigil Mechanism

The Company has established a Vigil Mechanism policy in accordance with the provisionsof the Companies Act 2013 read with Rules there under and the Listing Agreement with thestock exchanges to deal with the instances of fraud and mismanagement. The details of thevigil mechanism are posted on the website of the Company.

Meetings of the Board

During the year four meetings of the Board of Directors were held. The maximum intervalbetween any two Board Meeting did not exceed 120 (One hundred twenty) days.

Particulars of Loans given Investments made Guarantees given and Securities provided.

Particulars of Loans given Investments made Guarantees given and Securities providedalong with the purpose for which the Loan or guarantee or security is proposed to beutilized by the Company is provided in financial statement.

Conservation of Energy Technology Absorption and Foreign Exchange earnings and outgo.

Particulars relating to Conservation of Energy Technology Absorption and ForeignExchange earnings and outgo as required to be disclosed under the Act are annexed heretoand form part of this Report.

Extract of Annual Return

A separate report on the details of the Extract of Annual Return in form MGT-9 isannexed herewith which form part of the Director’s Report.

Particulars of Employees and related disclosures.

Provisions of Section 197 (12) of the Act read with Rules 5 (2) and 5 (3) of theCompanies (Appointment and Remuneration of Managerial Personnel ) Rules 2014 are notattracted as none of the employees drawing excess remuneration of the limits set out inthe said Rules.

ISO CERTIFICATION

Your Company is an ISO 9001:2000 accredited by Bureau of Indian Standard Rooid VoorAccreditatie and Netherland. This certification indicates our commitments in meetingglobal quality and standards.

FIXED DEPOSITS

The company does not accept fixed deposits.

INTERNAL CONTROL SYSTEM AND ADEQUACY

Your company has been maintaining a well-established procedure for internal controlsystem. For the purpose of financial control company is adequately staffed withexperienced and qualified personnel at all levels and plays an important role inimplementing and monitoring the statutory and internal policy control environment. Therehas been a review conducted on regular interval by the internal auditors about thefinancial and operating control at various locations of the company and any significantfindings are reviewed by the Audit Committee of the Board of Directors.

ACKNOWLEDGEMENT

Your Directors wish to place on record their deep appreciation of the continued supportand co-operation received from Financial Institutions Banks and Shareholders the Stateand Central Government.

Your Directors also wish to place on record their appreciation of the devoted servicesof the Company’s employees who have diligently contributed to the Company’sprogress.

for and on behalf of the Board
Place : New Delhi Rakesh Mundra Vineet Jain
Dated : 6th August 2016 Director (Finance) & Company Secretary Managing Director