Your Directors have pleasure in presenting their 29th Annual Report on the business andoperations of the Company along with the audited accounts for the Financial Year endedMarch 31 2016.
1. Financial summary or highlights/Performance of the Company
|Particulars ||Standalone ||Consolidated |
| ||Year Ended ||Year Ended ||Year Ended ||Year Ended |
| ||31.03.2016 ||31.03.2015 ||31.03.2016 ||31.03.2015 |
|Sales & Other Income ||382580042 ||393928774 ||382671272 ||393933024 |
|Profit / (Loss) before Depreciation ||25598524 ||27857041 ||24591894 ||27034029 |
|Less Depreciation ||6603474 ||13145131 ||7389440 ||14589032 |
|Profit / (Loss) after Depreciation but before Extra Ordinary ||18995050 ||14711910 ||17202454 ||12444997 |
|Items || || || || |
|Add: Extra Ordinary Items ||- ||- ||- ||- |
|Profit / (Loss) after Extra Ordinary Items but before Tax ||18995050 ||14711910 ||17202454 ||12444997 |
|Less: Provision for Income Tax/ Deferred Tax Liability ||9263199 ||5500000 ||9263199 ||5500000 |
|Profit / (Loss) After Tax ||9731851 ||9211910 ||7939255 ||6944997 |
To implement the plans and to expand the business activities your Directors do notrecommend any dividend for the financial year ended March 31 2016.
The Board has not proposed any amount to carry to any reserves
On Standalone basis revenue from operations for FY 2015-16 were Rs. 38.25 Crore ascompared to Rs.39.39 Crore in FY 2014-15. Profit after tax for the year was Rs.97.32 lacs .as comparedto Rs 92 12lacs in FY 2014-15
5. Brief description of the Companys working during the year/State ofCompanys affair
The division wise working details are as under
|Particulars ||Rs. in Lach |
|Rentals ||1533.77 |
|Shoes Uppers ||2205.01 |
6. Change in the nature of business if any
There were no changes in the nature of business of the Company.
7. Material changes and commitments if any affecting the financial position ofthe company which have occurred between the end of the financial year of the company towhich the financial statements relate and the date of the report
There are no material changes and commitments which have occurred between the end ofthe financial year of the company to which the financial statement relate and the date ofthe report which may affect the financial position of the company.
8. Details of significant and material orders passed by the regulators or courtsstatus and companys operations in future
There were no significant and material orders passed by any regulators or courts ortribunals which may impact the going concern status and company operation in future.
9. Details in respect of adequacy of internal financial controls with referenceto the Financial Statements.
The company has identifiedand documented all key financial controls which impact thefinancial statements as part of its standing operating procedures (SOPs). The SOPs aredesigned for all critical processes across office where financial transactions areundertaken. The SOPs cover the standard processes risks key controls and each process isidentified to process owner. The financial controls are tested for effectiveness throughmanagement ongoing monitoring and review and internal audit. In our view the internalfinancial controls effecting financial statements are adequate and operatingeffectively .
10. Details of Subsidiary Companies
Phoenix Cement Limited and Phoenix Industries Limited are two subsidiaries companiesduring the year.
There are no associate companies or joint venture companies as per the Companies Act2013.
Consolidated Financial Statements
As required under the SEBI Listing Regulations consolidated financial statements ofthe Company and its subsidiaries prepared in accordance with Accounting Standard 21issued by the Institute of Chartered Accountants of India form part of the Annual Reportand are reflectedin the consolidated financialstatements of the Company. Pursuant toSection 129(3) of the Act a statement containing the salient features of the financialstatements of the subsidiary companies is attached to the financial statements in FormAOC-1. (Annexure-1) The Company will make available the said financial statements andrelated detailed information of the subsidiary companies upon the request by any member ofthe Company or its subsidiary companies. These financial statements will also be kept openfor inspection by any member at the Registered Office of the Company. and the subsidiarycompanies. Pursuant to the provisions of Section136oftheActthe of the Companyconsolidated financial statements along with relevant documents and separate auditedaccounts in respect of subsidiaries are available on the website of the Company.
11. Performance and financial position of each of the subsidiaries associates andjoint venture companies included in the consolidated financial statement.
The performance and financial position of the two subsidiary company are as under.
|Performance ||Phoenix Cement Limited ||Phoenix Industries Limited |
|Income ||91231 ||NIL |
|Expenditure ||257013 ||1626813 |
|Net Profit / (Loss) ||(165782) ||(1626813) |
|Financial Position || || |
|Share Capital ||829535700 ||94323000 |
|General reserves ||(556175823) ||(224789499) |
The Company has neither invited nor accepted any deposits from the public falling inthe ambit of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules 2014during the period under review. Accordingly no disclosures are required in this regard bythe Company.
13. Statutory Auditors
The Auditors M/s. Pradip Bhardwaj & Co Chartered Accountant (ICAI FirmRegistration No. 013697C) New Delhi were appointed as Statutory Auditors for a period of3 years from financial year 2014 to financial held on September 30 2014. However in termsof provisions of provision of Section 139 (1) of Companies Act 2013 and rules made thereunder the appointment of Auditors is required to be ratified by the Members of theCompany at every Annual General Meeting.
The Company has received a letter from auditor confirming that they are eligible forre-appointment as auditors of the Company under Section 139 of the Companies Act 2013 andmeet the criteria for appointment specified Act 2013.
Based on the recommendations of the Audit Committee and as per the provision of Section139(1) of the Companies Act 2013 and the Board of Directors of your Company proposes toratify the appointment of M/s. Pradip Bhardwaj & Co Chartered Accountant (ICAI FirmRegistration No. 013697C) New Delhi as Statutory Auditors of the Company for thefinancial year ending 2017.
14. Auditors Report
The observation made in the Auditors' Report read together with relevant notes thereonare self explanatory and hence do not call for any further comments under Section 134 ofthe Companies Act 2013. The Auditors Report does not contain any qualificationreservation adverse remark or disclaimer.
15. Share Capital
A) Issue of equity shares with differential rights
The Company has not issued any Equity Shares during the year under review.
B) Issue of sweat equity shares
The Company has not issued any Sweat Equity Shares during the year under review.
C) Issue of employee stock options
As the Company has not issued any Employee Stock Options during the year under reviewhence there is nothing to disclose as required under Rule 12 (9) of the Companies (ShareCapital and Debentures) Rules 2014.
D) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees
As the Company has not made provision of money for purchase of its own shares byEmployee or by trustee for the benefit of employees during the year under review hencethere is nothing required to disclose the details as required under rule 16 (4) ofCompanies (Share Capital and Debentures) Rules 2014
E) Listing of Shares
The Equity Shares of the Company are listed with Delhi Stock Exchange and Bombay StockExchange. The Delhi Stock Exchange is now non operational / de-recognized. The Securities& Exchange Board of India (SEBI) vide circular No.CIR/MRD/DSA/18/ 2014 dated 22nd May2014 read with circular No.CIR/ MRD/DSA/05/2015 dated 17th April 2015 inter-alia statedthat the companies exclusively listed on the non-operational/de-recognized stock exchangeswhich fail to obtain listing in any other nationwide stock exchange will cease to belisted companies and will be moved to the dissemination board. However the Share of theCompany is listed with Bombay Stock Exchange.
16. Extract of the Annual Return
As provided under Section 92(3) of the Act the details forming part of the extract ofthe Annual Return is annexed herewith in Form MGT 9 Annexure-2.
17. Conservation of energy technology absorption and foreign exchange earnings andoutgo
The particulars as prescribed under sub-section (3)(m) of Section 134 of the CompaniesAct 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 are given in theAnnexure 3 which is annexed hereto and forms a part of the Boards Report.Foreign exchange earnings and Outgo:
|Description ||Value in Rs. |
|Earning in foreign currency/Export Sales ||NIL |
|Remittance in foreign currency-material & others including travelling ||1359.38 Lacs |
A) Appointment / Re-Appointment of Directors
Pursuant to the provisions of Section 152 of the Companies Act 2013 and provision ofthe Articles of Association of the Company Mr. Narender Makkar (DIN-00026857) Director ofthe Company is liable to retire by rotation and being eligible offers himself forre-appointment. The disclosures required pursuant to Regulation 36 of SEBI ListingRegulations are given in the Notice of the AGM forming part of the Annual Report.Attention of the Members is invited to the relevant items in the Notice of the AGM and theExplanatory Statement thereto.
B) Independent Directors
During the year Mrs Rupali Chawla resigned from the Board in the capacity ofIndependent Director w.e.f. 09.11.2015. The Board has placed on record its appreciationfor the valuable guidance and support received from Mrs. Rupali Chawla during herassociation with the Company. Pursuant to the provisions of Section 149 of the Act readalong with the Rules framed thereunder and the Resolutions passed by the Members at theAnnual General Meeting held on 30.09.2015 Mr Arun Kumar Sinha would continue asIndependent Director upto 30.09.2019. Mrs. Rekha Mittal was appointed as AdditionalDirector in the capacity of Independent Director in the Board Meeting held on 30thDecember 2015 upto the date of this Annual General Meeting. In terms of section 160 ofthe Companies Act 2013 the Company has received notice in writing from member along witha deposit of Rs. 1 Lakh proposing the candidature of Mrs. Rekha Mittal for appointment asIndependent Director as per the provisions of sections 149 and 152 of the Act.
The Board of Directors have proposed that Mr. Narendra Aggarwal be appointed as anIndependent Director of the Company. The appointment of Mr. Narendra Aggarwal shall beeffective upon approval by the members in the Meeting. The Company has received a noticein writing from a member along with the deposit of requisite amount under Section 160 ofthe Act proposing the candidature of Mr. Narendra Aggarwal for the office of Director ofthe Company.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Act and Regulation 16 of the SEBIListing Regulations.
KEY MANAGERIAL PERSONNEL
The following Directors/Executives continued as KMPs of the Company during Fiscal 2016:
Mr. Arun Kumar Sinha Independent Director
Mr. P M Alexander Director
Mr. Narendra Aggarwal
Mr. Narender Makkar Director & Company Secretary
During the year under review the Company adhered to the Governance Guidelines on BoardEffectiveness. The Governance Guidelines cover aspects related to composition and role ofthe Board Chairman and Directors Board diversity definition of independence directorterm retirement age and Committees of the Board. It also covers aspects relating tonomination appointment induction and development of directors director remunerationsubsidiary oversight Code of Conduct Board Effectiveness Review and Mandates of BoardCommittees.
Selection and procedure for nomination and appointment of Directors
The Nomination and Remuneration Committee ("NRC") is responsible fordeveloping competency requirements for the Board based on the industry and strategy of theCompany. The Board composition analysis reflects in-depth strategies environmentoperations financial condition and compliance requirements.
The NRC conducts a gap analysis to refresh the Board on a periodic basis includingeach time a Directors appointment or reappointment is required. The Committee isalso responsible for reviewing and vetting the CVs of potential candidates vis-a-vis therequired competencies undertake a reference and due diligence and meeting potentialcandidates prior to making recommendations of their nomination to the Board. At the timeof appointment specific requirements for the position including expert knowledgeexpected is communicated to the appointee.
Criteria for Determining Qualifications Positive Attributes and Independence of aDirector
The NRC has formulated the criteria for determining qualifications positive attributesand independence of Directors in terms of Section 178 (3) of the Act and Regulation 19read along with Schedule II of SEBI Listing Regulations which is annexed as Annexure-4
The Company has in place a Remuneration Policy for the Directors Key ManagerialPersonnel and other employees pursuant to the provisions of the Act and Regulation 19 ofSEBI Listing Regulations and the same is annexed as Annexure-7
Pursuant to the provisions of the Act and the Corporate Governance requirements asprescribed by SEBI Listing Regulations the Board has carried out an annual evaluation ofits own performance and that of its Committees and individual Directors.
The performance of the Board and individual Directors was evaluated by the Boardseeking inputs from all the Directors. The performance of the Committees was evaluated bythe Board seeking inputs from the Committee Members. The NRC reviewed the performance ofthe individual Directors a separate meeting of Independent Directors was also held toreview the performance of Non-Independent Directors performance of the Board as a wholeand performance of the Chairman of the Company taking into account the views of ExecutiveDirectors and Non-Executive Directors. This was followed by a Board Meeting that discussedthe performance of the Board its Committees and individual Directors.
The criteria for performance evaluation of the Board included aspects like Boardcomposition and structure effectiveness of Board processes information and functioningetc. The criteria for performance evaluation of Committees of the Board included aspectslike composition of Committees effectiveness of Committee meetings etc.
The criteria for performance evaluation of the individual Directors included aspects oncontribution to the Board and Committee meetings like preparedness on the issues to bediscussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the Chairman was also evaluated on the key aspects of his role.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
The details of the programme for familiarisation of the Independent Directors with theCompany in respect of their roles rights responsibilities in the Company nature of theindustry in which Company operates business model of the Company and related matters areput up on the website of the Company.
The Company has adopted a Whistle Blower Policy establishing vigil mechanism toprovide a formal mechanism to the Directors and employees to report their concerns aboutunethical behaviour actual or suspected fraud or violation of the Companys Code ofConduct. The Policy provides for adequate safeguards against victimization of employeeswho avail of the mechanism and also provides for direct access to the Chairman of theAudit Committee. It is affirmed that no personnel of the Company has been denied access tothe Audit Committee.
19. Number of meetings of the Board of Directors
The Board of your Company met 6 times during the financial year ended 31.03.2016 thedetails of which are given in the Corporate Governance Report that forms the part of thisAnnual Report.
20. Committees of the Board
Currently the Board has three committees:-
1. The Audit Committee
2. The Risk Management Committee
3. The Nomination and Remuneration Committee
4. Stakeholders Relationship Committee
A detailed note on the composition of the Board and its Committees is provided in theCorporate Governance Report Section of this Annual Report.
21) Particulars of loans guarantees or investments under section 186
The details of Loans Guarantees or Investments made under Section 186 of the Actduring the year are given below:
|Description ||Phoenix Cement Limited ||Phoenix Industries Limited |
|Advance Recovable ||Rs. 16425744 ||Rs. 484000000 |
|Investment in shares ||41953510(Nos.) Rs. 130846956 ||8432300(Nos.) Rs. 27104727 |
|Other Advance ||1500000 ||205840000 |
22. Particulars of contracts or arrangements with related parties:
All Related Party Transactions that were entered into during the year were on anarms length basis and were in the ordinary course of business. There are nomaterially significant Related Party Transactions made by the Company with promotersdirectors Key Managerial Personnel or other designated persons which may have anpotential conflict with the interest of the Company at large.
None of the Directors has any pecuniary relationships or transactions vis-a-vis theCompany.
The policy on dealing with the Related Party Transactions intends to ensure that properreporting approval and disclosure process are in place for all transactions between thecompany specificallydeals with the review and and Related Parties. This policy approval ofRelated Party Transactions keeping in mind the potential or actual conflicts of interestthat may arise because of entering into these transactions. All Related party Transactionsare placed before the Audit Committee for review and approval. Prior omnibus approval isobtained for Related Party Transactions which are of repetitive nature and/or entered inthe Ordinary Course of Business and are at Arms Length.
The Form AOC-2 pursuant to Section 134(3) (h) of the Companies Act 2013 read with Rule8(2) of the Companies (Account) Rules 2014 is set out as Annexure-5 to this report
23. PARTICULARS OF EMPLOYEES
The information on employees who were in receipt of remuneration of not less than Rs.60lakhs during the year or Rs.5 lakhs per month during any part of the said year as requiredunder Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is not provided as the same is notapplicable to the Company.Disclosure pertaining to remuneration and other details asrequired under Section 197(12) of the Act read with rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are Annexed to thereport as Annexure-6
24. Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed M/s. Mayank Panwar & Co. a firm of Company Secretaries in practice toundertake the Secretarial Audit of the Company. The Secretarial Audit report is annexedherewith as Annexure-8
25. Corporate Governance
A separate section on Corporate Governance forming part of the Board Report alongwith the Certificate from the Auditors of the Company confirmingcompliance of CorporateGovernance norms as stipulated in Regulation 34 read along with Schedule V of the SEBIListing Regulations is included in the Annual Report..
26. Risk Management Policy
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner. Your Company periodically assessesrisks in the internal and external environment along with the cost of treating risks andincorporates risk treatment plans in its strategy. The Internal Audit Departmentfacilitates the execution of Risk Management Practices in the Company in the areas of Riskidentification; assessement monitoring mitigation and reporting. The Company has laiddown procedures to inform the Audit Committee as well as the Board of Directors about riskassessment & management procedures and status.
The Company has policy to hedge most of the payments of Currency in order to reduce therisk of volatile international market of Foreign Exchange.
All properties including building plant machinery furniture fixture stock andStock in transit of the Company have been properly insured against all kinds of risk.
27. Directors Responsibility Statement
Pursuant to Section 134(5) of the Act the Board to the best of their knowledge andability confirm that:
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period;
(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
An acknowledgement to all with whose help cooperation and hard work the Company isable to achieve the results.
| ||For and on behalf of the Board of Directors || |
| ||Phoenix International Limited || |
|Place: New Delhi ||Narender Makkar ||P M Alexander |
|Date: 12.08.2016 ||Director & Company Secretary ||Chairman |