Rajasthan Tube Manufacturing Co Ltd.
|BSE: 530253||Sector: Metals & Mining|
|NSE: N.A.||ISIN Code: INE497E01012|
|BSE LIVE 15:14 | 13 Oct||14.25||
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
Rajasthan Tube Manufacturing Co Ltd. (RAJASTUBEMFG) - Director Report
Company director report
Your Directors have pleasure in presenting their 30th Annual Report on thebusinesses and operations of your company together with audited statement of accounts forthe year ended on 31st March 2016.
1. FINANCIAL RESULTS:
2 . DIVIDEND:
Your Directors are unable to recommend any dividend during the year under review inview of insufficient profits.
In view of the insufficient profits your Board of Directors does not appropriate anyamount to be transferred to General Reserves during the year under review.
4. STATE OF COMPANY'S AFFAIR:
During the year under review the sales and other income during the year decreased toRs.8094.00 Lacs as compared to Rs. 9234.30 Lacs in the previous year. The profit after taxduring the year is Rs. 23.01 lacs as compared to a loss of Rs.226.44 lacs in the previousyear.
5. CHANGE IN THE NATURE OF BUSINESS:
There is no change in the nature of business in the year under review.
6. MATERIAL CHANGES & COMMITMENTS:
No material changes and commitments have occurred after the close of the year till thedate of this report which affect the financial position of the company.
No significant or material orders were passed by the Regulators or courts or tribunalswhich impact the going concern status and company's operation in future.
8. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The company has an Internal Control System commensurate with the size scale complexityof its operations. The company has formulated Internal Financial Control policy accordingto Sec 134(5) (e) of the Companies Act 2013.
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.
9. DETAILS / FINANCIAL POSITION OF SUBSIDIARY / JOINT VENTURE/ ASSOCIATE COMPANY:
The company does not have any subsidiary/ associate or Joint Venture.
The Company has not accepted any fixed deposit under Chapter V of the Companies Act2013 during the year under report.
11. STATUTORY AUDITORS:
The term of office of M/s. Pramod & Associates as Statutory Auditors of theCompany will expire with the conclusion of forthcoming Annual General Meeting of theCompany. M/s. Pramod & Associates has been Statutory Auditors of your Company for morethan ten years.
The Board of Directors of the Company has subject to approval of the Members decidedto make a change in the Statutory Auditors. This change is in order to remain at theforefront of good governance and in recognition of regulatory changes in India.
A resolution proposing appointment of M/s. Giriraj & Lohiya as the StatutoryAuditors of the Company pursuant to Section 139 of the Companies Act 2013 forms part ofthe Notice.
M/s. Pramod & Associates over many years have successfully met the challenge thatthe size and scale of the Company's operations pose for auditors and have maintained thehighest level of governance rigour and quality in their audit. The Board place on recordits appreciation for the services rendered by M/s. Pramod & Associates as theStatutory Auditors of the Company.
12 . AUDITORS' REPORT:
The observations of the Auditors have been suitably dealt within the notes on accounts.The Auditor's Report does not contain any qualification reservation or adverse remark.
M/s G.K. Gupta & Co. Cost Accountants were appointed as the Cost Auditors of thecompany for the Financial Year 2015-16 and the audit report will be considered by theBoard of Directors.
The Board of Directors in their meeting held on 30th May 2016 haveapproved the appointment of M/s G.K. Gupta & Co. Cost Accountants as the CostAuditors of the company for the Financial Year 2016-17 and also fixed the audit feepayable to them. As per the provisions of Section 148 of Companies Act 2013 read withCompanies (Audit and Auditors) Rules 2014 audit fee payable to the Cost Auditors is to beratified by the members of the company. Your Directors have proposed a resolution in thenotice annexed to this report for approval of the audit fee.
14 . SHARE CAPITAL:
The paid up equity share capital as on 31st March 2016 was 44998500. Duringthe year under review the company has neither issued shares with differential votingrights nor granted stock options and sweat equity. As on March 31 2016 none of theDirectors of the company hold any convertible instruments of the company.
15. EXTRACT OF ANNUAL RETURN:
Extract of Annual Return of the company as provided under section 92(3) Companies Act2013 is annexed herewith as Annexure I in the prescribed Form MGT-9 to this Report.
16. PARTICULARS OF ENERGY CONSUMPTION ETC:
a) CONSERVATION OF ENERGY: The information pursuant to sub-section 3(m) of section 134of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 is either nil ornot applicable. However the company is conscious about its responsibility to conserveenergy power and other energy resources wherever applicable.
b) TECHNOLOGY ABSORPTION: Your Company has not imported any technology in the yearunder review.
c) FOREIGN EXCHANGE EARNING & OUTGO: There was no inflow and outflow of ForeignExchange during the year.
17. CORPORATE SOCIAL RESPONSIBILITY:
The provisions of CSR are not applicable to the company for the Financial Year2015-2016 as the company does not fall under the provisions of Section 135 of theCompanies Act 2013.
a) In accordance with the provisions of the Act and the Articles of Association of theCompany Smt Rajshree Patni Director of the Company retire by rotation at the ensuingAnnual General Meeting and being eligible has offer herself for re-appointment.
b) The Company has received declarations from all the Independent Directors of theCompany confirming that they meet the criteria of independence as specified in Section149(6) of the Companies Act 2013 and under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
c) The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the Chairman was also evaluated on the key aspectsof his role.
In a separate meeting of independent Directors performance of non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and nonexecutivedirectors. The same was discussed in the board meeting and Nomination and Remunerationmeeting that followed the meeting of the independent Directors at which the performanceof the Board its committees and individual directors was also discussed.
19. NO. OF BOARD MEETINGS:
Six meetings of the Board of Directors were held during the year. Apart from this onemeeting of Independent Directors was also held during the year.
20. AUDIT COMMITTEE:
The Audit Committee comprises Independent Directors namely Shri Sunil Kumar Jain(Chairman) Shri Deepesh Jain and Shri Mahendra Kumar Jain as other members. All therecommendations made by the Audit Committee were accepted by the Board.
21. VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
The company has a vigil mechanism policy to deal with instance of fraud andmismanagement if any. The detail of the policy is posted on the website of the company.
22. NOMINATION & REMUNERATION COMMITTEE:
The Nomination & Remuneration Committee comprises Independent Directors namely ShriDeepesh Jain (Chairman) Shri Sunil Kumar Jain and Shri Mahendra Kumar Jain as othermembers.
23. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIESPROVIDED:
There is no outstanding loan & guarantee at the year end as prescribed undersection 186 of the Companies Act 2013. The company has not made any investment during theyear as prescribed under section 186 of the Companies Act 2013.
24. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:
The Board of Directors of the Company as per the provisions of Regulation 23 of theListing Regulations has formulated a policy on Material Related Party Transactions. Thesaid policy is available on the website of the Company www.rajtube.com.During the year there have been no materially significant related party transactionsundertaken by the Company under Section 188 of the Companies Act 2013 and Regulation 23of the Listing Regulations that may have potential conflict with the interest of theCompany at large. Form No. AOC-2 which forms part of the Board's Report is annexedherewith as Annexure - II.
Also Refer note no. 36 of the financial statements as at 31st March 2016 which formspart of this Annual Report for details of related party transactions.
25. MANAGERIAL REMUNERATION/PARTICULARS OF EMPLOYEES:
The information required under Section 197 of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
Non- executive directors and Mrs. Rajshree Patni are only being paid sitting fees. Theydo not draw any remuneration.
b. The remuneration of any of the directors/CFO/CS did not increase in the relevantfinancial year.
c. The percentage increase in the median remuneration of employees in the FinancialYear:
*While calculating median remuneration remuneration of only those employees isconsidered who were in employment for the complete financial year 2015-2016.
d. The number of permanent employees on the roll of the company at the end of therelevant financial year: 30
e. There is no increase in the remuneration of employees or managerial personnel hencecomparison is not made.
f. There is no variable component of remuneration availed by directors in the relevantfinancial year.
g. The company affirms the remuneration is as per the remuneration policy of thecompany.
h. The statement containing particulars of employees as required under section 197(12)of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided in a separate annexure forming part of thisreport. Further the report and the accounts are being sent to the members excluding theaforesaid annexure. In terms of section 136 of the Act the said annexure is open forinspection at the Registered Office of the Company. Any shareholder interested inobtaining a copy of the same may write to the Company Secretary.
26. SECRETARIAL AUDIT REPORT:
As per the requirement of Section 204 (1) of the Companies Act 2013 and Rule 9
of the Companies (Appointment and Remuneration Personnel) Rules 2014 the Company hasobtained a Certificate from Ms. MEGHA KHANDELWAL Company Secretary in Whole timePractice Confirming that the Company has complied with the provisions of the CompaniesAct 2013 in the Financial Year 2015-2016 and a copy of the Secretarial Audit Report isannexed to this Report as Annexure- III.
2 7 . CORPORATE GOVERNANCE:
The company is committed to maintain the highest standard of Corporate Governance andadhere to the Corporate Governance requirement as set out by SEBI. As regards to theCorporate Governance Report as specified in Para C of Schedule V of SEBI (ListingObligations and disclosure Requirements) Regulations 2015 the same is not applicable tothe Company as the equity share capital of the company is less than Rs. 10 crore and networth is less than Rs. 25 crore.
28. RISK MANAGEMENT POLICY:
Pursuant to the requirement of Companies Act 2013 and of listing regulations thecompany has a robust Enterprise Risk Management framework to identify evaluate businessrisk & opportunities. This framework seeks to create transparency minimize adverseimpact on the business objectives and enhance the Company's competitive advantage. Thebusiness risk framework defines the risk management approach across the enterprise atvarious levels including documentation and reporting. The framework has different riskmodels which help in identifying risks trend exposure and potential impact analysis at aCompany level.
2 9 . DIRECTORS RESPONSIBILITY STATEMENT:
In Pursuant to section 134(5) of the Companies Act 2013 the board of directors tothe best of their knowledge and ability confirm that:
a) in the preparation of the annual accounts for the year ended March 31 2016 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b) the Directors have 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 as at March 31 2016 and of the profitsof the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a 'going concern' basis;
e) the Directors have laid down internal financial controls to be followed by the
Company and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
30. MANAGEMENT DISCUSSION & ANYLYSIS REPORT:
a) INDUSTRY STRUCTURE & DEVELOPMENT:
Activities of your company come under the category of steel tube industry. With theincreased activity in housing and agriculture the future of the steel tube industry shallcontinue to remain encouraging.
b) OPPORTUNITIES THREATS RISK & CONCERNS:
Presently major requirements of pipes in Rajasthan are being met through units situatedoutside Rajasthan. The pipes manufactured by the company would be able to competeeffectively in the market as they would have a clear price advantage over the otheroutside suppliers because of lower transportation cost benefits applicable to the company.
The company's product shall enjoy 4% price preference and 80% purchase preference inall Govt. & semi Govt. organizations of Rajasthan Govt. Steel Tube and pipe industryis expected to show good prospects in view of increased availability of H.R. Coils beingbasic raw material to manufacture M.S. Steel Tube .
More units with similar facility may come up resulting in greater competition and lowerprice realization.
Changed state Govt. policies may affect the profitability of the company.
The steel tube industry is subject to market cycle and as constituent of the industryyour company is also exposed to these constituent. Rise in price of H.R. Coils Zinc arealso a matter of concern.
The operations of the company are covered in one segment only i.e. steel tube segment.
Having regards to the prevailing circumstances your company visualizes a hopeful growthin the industry.
e) INTERNAL CONTROL SYSTEM :
Your company maintains an internal control system in different areas like purchasesbilling for the jobs etc. Moreover there are internal auditors who make consistentmonitoring to have proper and sufficient care for maintenance of adequate accountingrecords required for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities.
f) DEVELOPMENT: HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT :
Your Board has nothing to report on the development in human resource as wellindustrial relations front which have a material bearing on the business of the company.
g) DISCLOSURE BY THE MANAGEMENT:
Your board has not received any disclosure by the management relating to any materialfinancial and commercial transactions where any of the managerial staff has personalinterest that may have a potential conflict with the interest of the company at large.
Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
Your Directors are grateful to the Government authorities financial institutionsbankers business constituents for their continued co-operation and timely support to thecompany.
Your Directors also express their deep appreciation for the devoted services byworkers staff and executives at all levels of operations in achieving the results for theyear.
Industrial relations continued to remain happy and cordial.