Your Directors are pleasured to present the 32nd ANNUAL REPORT together with theAudited Financial Statements for the Financial Year 2015-16 ended 31st March 2016.
1. FINANCIAL RESULTS:
| || ||(Rs in Lacs) |
|Particulars ||2015-2016 ||2014-2015 |
|Operating Profit (Before Interest & Depreciation) ||82.65 ||78.83 |
|Less: Interest ||124.17 ||152.93 |
|(Loss) before Depreciation ||(41.52) ||(74.10) |
|Less: Depreciation ||6.38 ||6.38 |
|(Loss) before Exceptional items ||(47.90) ||(80.48) |
|Add : Exceptional Items / Profit on sale of Plant & Machinery ||0.06 ||272.07 |
|Profit/ (Loss) Before Tax ||(47.84) ||191.59 |
|Less: Provision for taxation ||- ||- |
|Profit/ (Loss) for the year after Tax ||(47.84) ||191.59 |
|(Debit) Balance brought forward from Previous year ||(1007.34) ||(1197.52) |
|Adjustment relating to Fixed Assets ||- ||(1.41) |
|(Debit) Balance carried to Balance Sheet ||(1055.18) ||(1007.33) |
There are no material changes and commitment affecting the financial position of theCompany which have occurred between 1st April 2016 and date of this report.
As the Company has accumulated losses your Directors are unable to recommend anyDividend for the Year 2015-16.
3. SALES & WORKING RESULTS:
The Company has generated revenue of Rs 91.24 lacs during the year under reviewas compared to Rs 83.20 lacs during 2014-15. The Company has earned other income of Rs29.05 lacs during the year under review during the year under review as compared to Rs21.59 lacs during 2014-15.
The Profit before Interest and Depreciation during the year 2015-16 was Rs 82.65 lacsas compared to Profit of Rs 78.83 Lacs during the year 2014-15. As the Company hadto provide for Interest of Rs 124.17 Lacs during the year under review the Loss beforeDepreciation was Rs 41.52 lacs compared with Loss of Rs 74.10 lacs during 2014-15.The Company provided Rs 6.38 lacs for Depreciation and therefore Loss before consideringExceptional items stood at Rs 47.90 lacs during the year under review compared toLoss of Rs 80.48 lacs for the year 2014-15. After taking into account Profit onExceptional items of Rs 0.06 lacs the Net Loss for the year under review stood at Rs47.84 lacs as against Net Profit of Rs 191.59 lacs during 2014-15.
4.1 During the year under review the Company was generally regular in payment ofPrincipal and Interest to the Financial Institutions/Banks. The Company is enjoyingWorking Capital Facilities from Mehsana Urban CoOperative Bank Limited.
4.2 The Income tax and Sales tax Assessment of the Company have been completed up toAssessment Year 2013-14 and the Financial Year 2011-12 respectively.
5. DISCONTINUANCE OF BUSINESS:
The Company had discontinued the running business of HDPE/PP Woven Bags Fabrics andTarpaulin in the year 2014-15 in view of unviable operations.
6. WOVEN SACKS PLANTRs:
As the operations of RsWoven SacksRs had been non-operational / unviable themanagement had decided to dispose off the RsWoven Sacks PlantRs of the Company situated atPlot No. 392 to 403 GIDC Estate Phase II Dediyasan Mehsana 384 002 in2014-15.
The necessary approval of the members of the Company was obtained pursuant to necessaryprovisions of the Companies Act. The management is in the process of disposing off theplant.
7.1 One of your Directors viz. Mr. Ankit J. Patel retires by rotation in terms of theArticles of Association of the Company. However being eligible offers himself forreappointment.
7.2 Mr. Miteshkumar A. Patel has been elevated as Chairman w.e.f. 12th February 2016.
7.3 The Board of Directors duly met 6 times during the financial year under review.
7.4 The Company has received necessary declaration from each Independent Director ofthe Company under Section 149(7) of the Companies Act 2013 (the Act) that they meet withthe criteria of their independence laid down in Section 149(6) of the Act.
7.5 Formal Annual Evaluation:
The Nomination and Remuneration Committee adopted a formal mechanism for evaluating theperformance of the Board of Directors as well as that of its Committees and individualDirectors including Chairman of the Board Key Managerial Personnel/ Senior Managementetc. The exercise was carried out through an evaluation process covering aspects such ascomposition of the Board experience competencies governance issues etc.
7.6 DIRECTORSRs RESPONSIBILITY STATEMENT:
Pursuant to the requirement of Section 134 of the Companies Act 2013 it is herebyconfirmed:
(i) that in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;
(ii) 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 31st March 2016 beingend of the financial year 2015-16 and of the loss of the Company for the year;
(iii) that the Directors had taken proper and sufficient care for 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 had prepared the annual accounts on a going concern basis.
(v) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
8. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY:
The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the CompanyRss policies safeguarding ofassets prevention and detection of frauds and errors accuracy and completeness of theaccounting records and the timely preparation of reliable financial disclosures.
9. MANAGERIAL REMUNERATION:
REMUNERATION OF DIRECTORS:
The Company has not paid any Managerial Remuneration or other benefits to any of itsDirectors. The Board of Directors has framed a Remuneration Policy that assures the leveland composition of remuneration is reasonable and sufficient to attract retain andmotivate Directors Key Managerial Personnel and Senior Management to enhance the qualityrequired to run the Company successfully. The Relationship of remuneration to performanceis clear and meets appropriate performance benchmarks. All the Board Members and SeniorManagement personnel have affirmed time to time implementation of the said Remunerationpolicy.
The Nomination and Remuneration Policy are available on the CompanyRsswebsite-www.promactplastics.com.
10. KEY MANAGERIAL PERSONNEL :
% INCREASE IN REMUNERATION OF DIRECTORS AND KMP:
Company has not paid any managerial remuneration to any of its KMP. There is noincrease in remuneration paid to Mr. Vipul Bhavsar CFO.
11. PERSONNEL AND H. R. D.:
11.1 INDUSTRIAL RELATIONS:
The industrial relations continued to remain cordial and peaceful.
The relationship between average increase in remuneration and CompanyRss performance isas per the appropriate performance benchmarks and reflects short and long term performanceobjectives appropriate to the working of the Company and its goals.
11.2 PARTICULARS OF EMPLOYEES:
There is no Employee drawing remuneration requiring disclosure under Rule 5(2) ofCompanies (Appointment & Remuneration of Managerial personnel) Rules 2014.
12. RELATED PARTY TRANSACTION AND DETAILS OF LOANS GUARANTEES INVESTMENT &SECURITIES PROVIDED:
Details of Related Party Transactions and Details of Loans Guarantees and Investmentscovered under the provisions of Section 188 and 186 of the Companies Act 2013respectively are given in the notes to the Financial Statements attached to theDirectorsRs Report.
All transactions entered by the Company during the financial year with related partieswere in the ordinary course of business and on an armRss length basis. During the yearthe Company had not entered into any transactions with related parties which could beconsidered as material in accordance with the policy of the Company on materiality ofrelated party transactions.
The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the CompanyRss website atwww.promactplastics.com.
13. DEMATERIALISATION OF EQUITY SHARES:
Shareholders have an option to dematerialise their shares with either of thedepositories viz NSDL and CDSL. The ISIN No. allotted is INE818D01011.
14. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
The information required under Section 134(3)(m) of the Companies Act 2013 and rule8(3) of Companies (Accounts) Rules 2014 relating to the conservation of Energy andTechnology Absorption are not applicable as there are no manufacturing activities duringthe year under review. The Company has not earned or spent any foreign exchange during theyear under review.
15. CORPORATE GOVERNANCE AND MDA:
As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 Report on Corporate Governance ManagementDiscussion and Analysis (MDA) and a certificate regarding compliance with the conditionsof Corporate Governance are appended to the Annual Report as Annexure A.
16. SECRETARIAL AUDIT REPORT:
Your Company has obtained Secretarial Audit Report as required under Section 204(1) ofthe Companies Act 2013 from M/s. Kashyap R. Mehta & Associates Company SecretariesAhmedabad. The said Report is attached with this Report as Annexure B. Asregards the observation of the Auditors the Company is in the process of identifying andappointing Whole-time Company Secretary and also developing functional website of theCompany.
17. EXTRACT OF ANNUAL RETURN:
The extract of Annual return in Form MGT-9 has been attached herewith as Annexure C.
The Equity Shares of the Company are listed on Ahmedabad Stock Exchange Limited &BSE Limited. The Company is regular in payment of Annual Listing Fees. The Company haspaid Listing fees up to the year 2016-17.
19. AUDIT COMMITTEE/ NOMINATION AND REMUNERATION COMMITTEE/ STAKEHOLDERSRs RELATIONSHIPCOMMITTEE:
The details of various committees and their functions are part of Corporate GovernanceReport
20.1. STATUTORY AUDITORS:
At the Annual General Meeting held on 22nd September 2015 M/s. M. M. Salvi &Company Chartered Accounts Mehsana were appointed as Statutory Auditors of the Companyto hold office till the conclusion of the Annual General Meeting to be held in the year2017. In terms of the first proviso to Section 139 of the Companies Act 2013 theappointment of the auditors shall be placed for ratification at every Annual GeneralMeeting. Accordingly the appointment of M/s. M. M. Salvi & Company CharteredAccountants as Statutory Auditors of the Company is placed for ratification by theshareholders.
The remarks of Auditor are self explanatory and have been explained in Notes onAccounts.
The movable and immovable properties of the Company including plant and Machinery andstocks wherever necessary and to the extent required have been adequately insured againstthe risks of fire riot strike malicious damage etc. as per the consistent policy of theCompany.
The Company has not accepted during the year under review any Deposits and there wereno overdue deposits.
20.4 RISKS MANAGEMENT POLICY:
The Company has a risk management policy which from time to time is reviewed by theAudit Committee of Directors as well as by the Board of Directors. The Policy is reviewedquarterly by assessing the threats and opportunities that will impact the objectives setfor the Company as a whole. The Policy is designed to provide the categorization of riskinto threat and its cause impact treatment and control measures. As part of the RiskManagement policy the relevant parameters for protection of environment safety ofoperations and health of people at work and monitored regularly with reference tostatutory regulations and guidelines defined by the Company.
20.5 SUBSIDIARIES/ ASSOCIATE/ JVs:
The Company does not have any Subsidiaries/ Associate Companies / JVs.
20.6 CODE OF CONDUCT:
The Board of Directors has laid down a Code of Conduct applicable to the Board ofDirectors and Senior Management. All the Board Members and Senior Management personnelhave affirmed compliance with the code of conduct.
20.7 SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There have been no significant and material orders passed by any regulators or courtsor tribunals impacting the going concern status of the Company and its future operations.
20.8 ENVIRONMENT AND SAFETY:
The Company is conscious of the importance of environmentally clean and safeoperations. The CompanyRss policy requires conduct of operations in such a manner so asto ensure safety of all concerned compliances of environmental regulations andpreservation of natural resources.
20.9 INSTANCES OF FRAUD IF ANY REPORTED BY THE AUDITORS:
There have been no instances of fraud reported by the Auditors under Section 143(12) ofthe Companies Act 2013.
21. DISCLOSURE OF ACCOUNTING TREATMENT:
In the preparation of the financial statements the Company has followed the AccountingStandards referred to in Section 133 of the Companies Act 2013. The significantaccounting policies which are consistently applied are set out in the Notes to theFinancial Statements.
Your Directors express their sincere thanks and appreciation to Promoters andShareholders for their constant support and co-operation. Your Directors also place onrecord their grateful appreciation and co-operation received from Bankers FinancialInstitutions Government Agencies and employees of the Company.
| ||For and on behalf of the Board |
|Place : Ahmedabad. ||Miteshkumar A. Patel |
|Date : 20th July 2016 ||Chairman |