for the Financial Year ended March 31 2017
Your Directors have pleasure in presenting their 32nd Annual Report on thebusiness and operations of the Company along with the Audited Accounts of the Companyfor the Financial Year ended March 31 2017.
The financial performance of the Company is summarized hereunder:
|Standalone Financial Review || ||(Amount in Rs.) |
|Particulars ||2016-17 ||2015-16 |
|Turnover ||10842176483 ||10130295623 |
|Profit before Finance Charges Tax Depreciation/ Amortization (PBITDA) ||1444179501 ||1350965268 |
|Less: Finance Charges ||105193019 ||187589255 |
|Profit before Tax Depreciation/Amortization (PBTDA) ||1338986482 ||1163376013 |
|Less: Depreciation ||150487036 ||151703052 |
|Profit before Tax & Exceptional Item ||1188499446 ||1011672961 |
|Add: Exceptional Item (Dividend received from Subsidiary) ||- ||122999820 |
|Profit before Tax (PBT) ||1188499446 ||1134672781 |
|Less: Tax Expense ||417421487 ||355135632 |
|Net Profit after Tax (PAT) ||771077959 ||779537149 |
|Consolidated Financial Review || ||(Amount in Rs.) |
|Particulars ||2016-17 ||2015-16 |
|Turnover ||10927548937 ||10148339040 |
|Profit before Finance Charges Tax Depreciation/ Amortization (PBITDA) ||1413934037 ||1358708973 |
|Less: Finance Charges ||105659372 ||187811466 |
|Profit before Depreciation/Amortization (PBTDA) ||1308274665 ||1170897507 |
|Less: Depreciation ||162077990 ||152398852 |
|Profit before Tax (PBT) ||1146196675 ||1018498655 |
|Less: Tax Expense ||423697283 ||359219807 |
|Net Profit after Tax (PAT) ||722499392 ||659278848 |
State of Company's Affairs and Future Outlook
The Company achieved a Turnover of Rs. 1084.22 crores in Financial Year 2016-17 asagainst Rs. 1013.03 crores in 2015-16 i.e. registering a growth of 7.03% over the lastyear. During the year the Profit before Finance Charges Depreciation and Tax stood atRs. 144.42 crores as against Rs. 135.10 crores during the previous year an increase of6.90% in comparison to previous year. The Net Profit for the year 2016-17 stood at Rs.77.11 crores as compared to Rs. 77.95 crores during the previous year.
The Company is engaged in the Manufacturing Branding and Marketing of Men's andWomen's Innerwear Thermal wear and Casual wear for kids and all sections of the societylike Economy Mid-Premium Premium and Super-Premium. It has over 18 sub-brands and 8000SKUs (Stock Keeping Unit) having a strong brand recall. In order to nurture its brandsthe Company has been consistently involved in robust advertisement and brand promotionactivities thereby spending extensively on brand communication. In innerwear industrythe Company is a leader having a distribution network across India. The Company has aPAN-India presence with a large distribution network consisting of 4 central warehouses 6EBOs (Exclusive Brand Outlets) 20 branches 1000 dealers and more than 118000retailers. It is also looking at enhancing availability through presence in e-commerceMBOs (Multi-Brand Outlets) and LFRs (Large Format Retail Stores). The Company is alsolooking forward to open Rupa EBOs through the franchisee route across India and expand itsretail footprint.
The Company has manufacturing facilities situated at Howrah Domjur Tirupur Bengaluruand Ghaziabad. The Company has sales offices situated at Kolkata Patna Varanasi MumbaiJaipur Indore Delhi Ghaziabad Kanpur Bengaluru Tirupur and Hyderabad. The Companyfollows efficient business strategy by outsourcing low end and labour intensive work andutilizes its resources on key areas involving value addition product differentiationbranding and distribution.
The Company caters to all segment including men women and kid segment with its widebouquet of brands. The various sub-brands of the Company includes Frontline Jon AirMacroman Macroman M series Macrowoman W series Euro Bumchums Torrido ThermocotKidline Footline Softline etc. catering to various segments under its umbrella brand'Rupa'. The brands are endorsed by leading celebrities including Hrithik Roshan RanveerSingh Sidharth Malhotra and Bipasha Basu.
Rupa is strengthening its position in the super-premium segment by acquiring theexclusive license for the manufacture market and sale of innerwear and other products offoreign brands in India through its Wholly-owned Subsidiary Oban Fashions PrivateLimited. During the year 2016-17 the said Oban Fashions Private Limited acquired anexclusive license from French Connection Limited for the brand 'FCUK' and has alsoacquired the brand 'Fruit of the Loom' from Fruit of the Loom Inc a Wholly-ownedSubsidiary of Berkshire Hathaway Company for the manufacture market and sale ofinnerwear and other products in India. We believe that these licenses would help the RupaGroup to further strengthen and cement its position in the super-premium segment.
The male innerwear segment contributes approximately 87% of the Company's business.Presently the Company is catering to female innerwear space through its brands JonSoftline and Macrowoman W Series. The Company is continuously striving at strengtheningits female innerwear segment as well and is open to grow in this segment throughinorganic route also in domestic market. The business opportunity in women's innerwear ishuge as it comprises 60% of the total Indian innerwear market in value terms and isgrowing at a brisk pace of 15% as compared to the average industry growth rate of 12%.
The Indian innerwear industry is highly unorganized with unorganized players having 50%market share. We believe that there is huge potential for organized players to gain marketshare in the Indian innerwear industry especially after the recent demonetization andrestrictions on cash based transactions. Further the implementation of GST would be amajor positive for organized players which is expected to bring down the manufacturingcost and would make the market relatively more competitive for the organized players.Further the organized players would also get set-off on service tax paid on advertisementexpenses.
In the past 3-4 years the topline of the Company has been growing at a single digitgrowth rate on account of (i) higher industry growth in premium and super-premiumsegments (ii) shift in consumer preference towards upper segment products and (iii)economy segment in men's wear is facing competition from unorganized players and newplayers. But with the acquisition of foreign brands by the Wholly-owned Subsidiary of theCompany it will help the Group to penetrate deeper in the premium and super-premiumsegments. Besides this we believe that the implementation of GST would also help theGroup to grow its economy and mid-segment which will become more competitive for theorganized players.
The Indian innerwear market is estimated to grow at 13% to reach Rs. 59540 crores by2023. Innerwear appears to be a potential growth category. The men's innerwear marketcontributes 40% and is characterized by the presence of numerous Indian and internationalbrands. The economy segment contributes around 56% in the men's wear market the mid-pricesegment 30% and the remaining 14% comes from premium and super-premium segments. Furtherthe premium and super-premium segments are expected to grow at a faster pace. The women'sinnerwear market which is driven by value- added innerwear products contributes around60% to the market and is growing at a faster rate of 15%. The market is largely dominatedby mid-priced and economy segment contributing 80% of the market while remaining comesfrom the premium and super-premium segments. The Company believes that the industry is 50%unorganized and expects shift to happen from unorganized to organized in the longer run.Increasing urbanization preference towards branded products introduction of GSTorganized and online retailing etc. are various factors which would drive growth fororganized players.
The Company believes in the overall growth of its innerwear thermal wear and casualwear business across India through its innovative designs superior product qualityability to create a sustainable business model initiatives to nurture the in-house talentand the zeal towards the healthy creation of stakeholders' value. To overcome the variouseconomical challenges the Company from time to time revisits its marketing strategies.The Company has always been responsive towards the changing fashion needs by introducingnew line of products across all segments.
The Company has the following 3 (three) Wholly-owned Subsidiaries as on March 31 2017:
(i) Euro Fashion Inners International Private Limited which was earlier engaged inselling hosiery products under the brand name "EURO" which are premiumproducts designed for the fashion conscious consumers has transferred its BusinessOperations to its Holding Company through a Business Collaboration Agreement effectivefrom April 1 2014. During the year under review the Revenue from Operations includingOther Income was Rs. 7.50 lacs as against Rs. 7.31 lacs during the previous year. NetLoss during the year was Rs. 5.62 lacs as compared to that of Rs. 7.75 lacs during theprevious year.
(ii) Imoogi Fashions Private Limited is engaged in manufacturing processing andselling hosiery and outer casual wear products especially for children up to the age of12 years under the brand name "Imoogi".
During the Financial Year under review the Revenue from Operations including OtherIncome was Rs. 320 lacs as against Rs. 246.35 lacs during the previous year. Net Profitduring the year was Rs. 27 lacs as compared to Rs. 53.23 lacs during the previous year.
(iii) Oban Fashions Private Limited has been incorporated with the object interalia to operate Indian business of international brands managed under licensing/franchise/ joint venture/ ownership arrangements etc.
During the Financial Year under review the Revenue from Operations including OtherIncome was Rs. 751.59 lacs as against nil during the period ended March 31 2016. Netloss during the year was Rs. 507.17 lacs as compared to Rs. 18.09 lacs during the periodended March 31 2016.
During the Financial Year 2016-17 Oban Fashions Private Limited has on April 07 2016entered into a definitive License Agreement with French Connection Limited whereby theWholly-owned Subsidiary has acquired the exclusive license from French Connection Limitedto develop manufacture market and sell the innerwear and related products under theirBrand name 'FCUK' in India. Further Oban Fashions Private Limited on March 09 2017entered into a License Agreement with Fruit of the Loom Inc a New York Corporationbeing a Wholly-owned Subsidiary of Berkshire Hathaway Company whereby the said ObanFashions Private Limited has acquired the exclusive license from the said Fruit of theLoom Inc to manufacture distribute advertise and sell innerwear and outerwear productsfor men boys women girls and toddlers in India under their brand names and marks.
In terms of Regulation 24 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ('Listing Regulations') the above subsidiaries are not materialsubsidiaries.
The statement in Form AOC-1 containing the salient features of the aforesaidsubsidiaries has been separately annexed to this Annual Report in terms of the firstproviso to the Section 129(3) of the Companies Act 2013 including any subsequentamendment thereto (the 'Act') read with Rule 5 of the Companies (Accounts) Rules 2014.Further the contribution of these subsidiaries to the overall performance of the Companyis provided under the Notes to the Consolidated Financial Statement. The Audited FinancialStatement together with the Consolidated Financial Statement of the Company and otherrelated information and the Audited Accounts of the Company's subsidiaries are availableon the website of the Company at www.rupa.co.in .
The Annual Accounts of the subsidiaries and the related detailed information shall bemade available to the Members of the Company seeking such information at any point oftime. The Members may request for such information by writing to the Company Secretary atthe registered office of the Company. The copies of the Annual Accounts of thesubsidiaries remain open for inspection by the Members at the Company's registered office.
Except as stated hereinabove the Company did not have any other subsidiary jointventure or associate company during the year under review.
Change(s) in the Nature of Business
During the year under review there were no changes in the nature of the business ofthe Company.
For the Financial Year 2016-17 the Board of Directors of the Company has recommended aFinal Dividend for consideration of the Shareholders of the Company at the ensuing AnnualGeneral Meeting @ 275% i.e. Rs. 2.75 per share for 79524560 equity shares of Rs.1/- (Rupee One only) each amounting to Rs. 218692540/- (Rupees Twenty One Crore EightySix Lakh Ninety Two Thousand and Five Hundred and Forty only). The dividend payout is inaccordance with the Company's Dividend Distribution Policy.
The Dividend Distribution Policy of the Company adopted by the Board of Directors ofthe Company pursuant to Regulation 43A of the Listing Regulations as amended is annexedhereto marked as 'Annexure - I'.
Transfer to Reserves
The Board is not proposing to transfer any amount to the General Reserves of theCompany.
Changes in Share Capital
During the year under review there were no changes in the Share Capital of theCompany.
Crisil Limited the Credit Rating Agency has assigned the credit ratings CRISILA+/Stable and CRISIL A1+ for the long term and short term debt instruments/faciliti'es ofthe Company respectively.
Directors and Key Managerial Personnel
Details of Directors and Key Managerial Personnel (KMP) appointed re-appointed orresigned during the year are as below:
|Sl. No. ||Directors/ Key Managerial Personnel ||Date of Appointment/ Re-appointment/ Resignation |
|(i) ||Mr. Ghanshyam Prasad Agarwala Vice-Chairman ||Re-appointed as Vice-Chairman (Whole-time Director) through the Postal Ballot process conducted via Postal Ballot Notice dated March 11 2016 w.e.f. April 1 2016 |
|(ii) ||Mr. Kunj Bihari Agarwal Managing Director (KMP) ||Re-appointed as Managing Director (KMP) through the Postal Ballot process conducted via Postal Ballot Notice dated March 11 2016 w.e.f. April 1 2016 |
|(iii) ||Mr. Arihant Kumar Baid Whole-time Director ||Appointed as a Whole-time Director w.e.f. November 5 2015 in the 31st Annual General Meeting of the Company held on August 31 2016 |
|(iv) ||Mr. Kundan Kumar Jha Company Secretary & Compliance Officer (KMP) ||Appointed as the Company Secretary & Compliance Officer (KMP) w.e.f. May 30 2016 |
|(v) ||Mr. Neeraj Sureka Chief Financial Officer (KMP) ||Resigned from the post of the Chief Financial Officer (KMP) w.e.f. November 17 2016 |
|(vi) ||Mr. Ramesh Agarwal Whole-time Director-cum-Chief Financial Officer (KMP) ||Appointed as Chief Financial Officer (KMP) w.e.f. February 10 2017. Consequently re-designated as Whole-time Director-cum-Chief Financial Officer |
Mr. Prahlad Rai Agarwala Chairman (Whole-time Director) and Mr. Mukesh AgarwalWhole-time Director are liable to retire by rotation in the ensuing Annual GeneralMeeting (AGM) and being eligible have offered themselves for re- appointment. Details ofDirectors to be re-appointed are provided in the Explanatory Statement to the Notice ofthe ensuing AGM.
Further details of Directors are provided in the Corporate Governance Report whichforms part of this Annual Report.
None of the Directors of the Company is disqualified under the provisions of Section164(2)(a) & (b) of the Act.
Apart from the aforesaid no changes in the Directors and KMPs have taken place duringthe period under review.
Statement on Declaration given by Independent Directors under Section 149(7) of the Act
All Independent Directors of the Company have given their declarations to the Companythat they meet the criteria of independence as laid down under Section 149(6) of the Actand Regulation 16 of the Listing Regulations.
Number of Meetings of Board of Directors
During the Financial Year 2016-17 4 (four) meetings of the Board of Directors wereheld details of which are given in the Corporate Governance Report which forms part ofthis Annual Report.
Separate Meeting of Independent Directors
During the year under review the Independent Directors without the presence ofNon-Independent Directors and members of the management met on March 16 2017 and interalia:
(i) reviewed the performance of Non-Independent Directors and the Board as a whole;
(ii) reviewed the performance of the Chairperson of the Company taking into accountthe views of Executive Directors and Non-executive Directors;
(iii) assessed the quality quantity and timeliness of flow of information between theCompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties.
Annual Evaluation of Performance
Pursuant to the provisions of the Act and the Listing Regulations the Nomination andRemuneration Committee has laid down the criteria for performance evaluation on the basisof which the Board has carried out evaluation of its own performance the performance ofBoard Committees and of the Directors individually.
The Independent Directors of the Company without the participation of Non-IndependentDirectors and members of management in their separate meeting have reviewed theperformance of Non-Independent Directors and the Board as a whole and also the performanceof the Chairperson of the Company. The review of performance of Non-Independent Directorswas done after discussing with them on various parameters such as skill competenceexperience degree of engagement ideas and planning etc. The Board performance wasreviewed on various parameters such as adequacy of the composition of the Board Boardculture appropriateness of qualification and expertise of Board members process ofidentification and appointment of Independent Directors inter-personal skills ability toact proactively managing conflicts managing crisis situations diversity in theknowledge and related industry expertise roles and responsibilities of Board membersappropriate utilization of talents and skills of Board members etc. The evaluation of theChairperson of the Company was conducted on various parameters such as leadershipquality capability availability clarity of understanding governance and compliance anddegree of contribution etc.
The Nomination and Remuneration Committee of the Board based on the report of theIndependent Directors evaluated the performance of the Non-Independent Directors. Thesaid Committee members also evaluated the performance of the Independent Directors of theCompany considering their requisite skills competence experience and knowledge of theregulatory requirements relating to governance such as roles and responsibilities theCode of Conduct of the Company including the Code for Independent Directors the Act theListing Regulations etc.
The Board of Directors of the Company based on the report of the Independent Directorsand the Nomination and Remuneration Committee evaluated the performance of Board and ofindividual Directors. The Board also carried out the evaluation of performance of itsCommittees on various parameters such as adequacy of meetings in enhancing theeffectiveness of the Committee existence of a defined set of objectives/ terms ofreference etc.
The result of review and evaluation of performance of Board it's Committees and ofindividual Directors was found to be satisfactory.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
The particulars related to the conservation of energy technology absorption andforeign exchange earnings and outgo as required under Section 134(3)(m) of the Act readwith Rule 8(3) of the Companies (Accounts) Rules 2014 are annexed hereto marked as'Annexure - II'.
Particulars of Employees
The particulars of employees as required under Section 197(12) of the Act read withRule 5(1) and 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are annexed hereto marked as 'Annexure - III'.
Disclosure on Employee Stock Option/ Purchase Scheme
Presently the Company does not have any Employee Stock Option/ Purchase Scheme.
As on March 31 2017 the Audit Committee comprised of 6 (six) Members of whichmajority were Independent Directors. The details with respect to the composition of theAudit Committee the number of meetings held during the Financial Year under review andattendance therein and the terms of reference has been detailed out in the CorporateGovernance Report which forms part of this Annual Report.
Further there were no instances wherein the Board had not accepted any recommendationof the Audit Committee.
In terms of the Section 177 of the Act read with the Rules made thereunder andRegulation 22 of the Listing Regulations the Company has framed a 'Whistle Blower Policy'with an objective to provide an avenue to address concerns in line with the policy of theCompany to the highest possible standards of ethical moral and legal business conduct andits commitment to open communication as well as timely redressal of concerns anddisclosures to build and strengthen a culture of transparency and trust in the Company.The mechanism also provides for adequate safeguards against victimization of director(s)or employee(s) or any other person availing the mechanism and in exceptional cases directaccess to the Chairman of the Audit Committee to report instances of fraud/ misconduct.Audit Committee looks into the complaints raised if any and their redressal. The WhistleBlower Policy of the Company is available on the website of the Company at the linkhttp://rupa.co.in/site/wp-content/uploads/2015/10/WhistleBlowerPolicy1.pdf
Nomination and Remuneration Committee
Details pertaining to constitution of the Nomination and Remuneration Committee of theBoard of Directors of the Company number of meetings held during the Financial Year underreview and attendance therein and its terms of reference have been stated in theCorporate Governance Report which forms part of this Annual Report.
Policy on Director's Appointment and Remuneration
The Board on the recommendation of Nomination and Remuneration Committee asprescribed under Section 178(3) of the Act has framed a Policy on Appointment andRemuneration of Directors Key Managerial Personnel and other employees of the Company andthe same in brief is annexed hereto marked as 'Annexure - IV'.
Stakeholders' Relationship Committee
Details pertaining to the constitution of the Stakeholders' Relationship Committee ofthe Board of Directors of the Company number of meetings held during the Financial Yearunder review and attendance therein and its terms of reference have been stated in theCorporate Governance Report which forms part of this Annual Report.
Corporate Social Responsibility (CSR)
Terms of Reference: The detailed terms of reference of the Corporate SocialResponsibility Committee is available on the website of the Company at the linkhttp://rupa.co.in/site/wp-content/uploads/2015/10/Corporate-Social-Responsibility-Committee.pdf
Composition of the Committee
|Name of Member ||Position ||Category |
|Mr. Prahlad Rai Agarwala ||Chairman ||Executive |
|Mr. Kunj Bihari Agarwal ||Member ||Executive |
|Mr. Vinod Kumar Kothari ||Member ||Independent Non-Executive |
The composition of the Committee complies with the provision of Section 135 of the Actread with Rules made thereunder.
Meeting and Attendance
During the Financial Year ended March 31 2017 2 (two) meetings of the CorporateSocial Responsibility Committee were held. The details of the said meeting and attendancetherein are as hereunder:
|Name of Member || |
Meetings held during the year and Attendance
| ||May 30 2016 ||February 06 2017 |
|Mr. Prahlad Rai Agarwala ||Present ||Present |
|Mr. Kunj Bihari Agarwal ||Present ||Absent |
|Mr. Vinod Kumar Kothari ||Present ||Present |
Annual Report on CSR Activities as prescribed under Section 135 of the Act read withRule 8 of the Companies (Corporate Social Responsibility Policy) Rules 2014 is annexedhereto marked as 'Annexure - V'.
Extract of the Annual Return
The extract of the Annual Return as at the Financial Year ended March 31 2017 inForm MGT-9 is annexed hereto marked as 'Annexure - VI'.
Risk Management Policy
The Company has a Risk Management Policy which lays down the framework foridentification and mitigation of various risks. The specific objectives of the RiskManagement Policy are to ensure that all the current and future material risk exposures ofthe Company are identified assessed quantified appropriately mitigated and managed toestablish a framework for the Company's risk management process.
The Risk Management Framework emphasises proper analysing and understanding theunderlying risks before undertaking any transaction. This enables a proper assessment ofall risks and ensures that the transactions and processes conform to the Company's riskappetite and regulatory requirements.
The Risk Management Policy is discussed at the meeting of the Audit Committee of theBoard of Directors. The management accepts the suggestions with regard to mitigation ofrisks that may arise in future. Further in the opinion of the Board there are noexisting factors which threaten the existence of the Company.
Internal Financial Control Systems with reference to Financial Statements and itsadequacy
The Company has adequate Internal Financial Control systems and procedures which arecommensurate with it's size and nature of business. It is ensured that all the assets aresafeguarded and protected against loss and all transactions are authorized recorded andreported correctly. The Internal Financial Control systems of the Company are monitoredand evaluated and reviewed by the Audit Committee.
The Directors have laid down Internal Financial Controls to be followed by the Companyand that such Internal Financial Controls are adequate and were operating effectively. Inthis regard the Board confirms the following:
(i) Systems have been laid to ensure that all transactions are executed in accordancewith management's general and specific authorization.
(ii) Systems and procedures exist to ensure that all transactions are recorded asnecessary to permit preparation of Financial Statements in conformity with GenerallyAccepted Accounting Principles or any other criteria applicable to such statements and tomaintain accountability for aspects and the timely preparation of reliable financialinformation.
(iii) Access to assets is permitted only in accordance with management's general andspecific authorization. No assets of the Company are allowed to be used for personalpurposes except in accordance with terms of employment or except as specificallypermitted.
(iv) The existing assets of the Company are verified/ checked at reasonable intervalsand appropriate action is taken with respect to differences if any.
(v) Proper systems are in place for prevention and detection of frauds and errors andfor ensuring adherence to the Company's policies.
Further the certificate from Managing Director (MD) and Chief Financial Officer (CFO)in terms of Regulation 17(8) of the Listing Regulations provided in this Annual Reportalso certifies the adequacy of our Internal Control systems and procedures.
Statutory Auditors and Auditors' Report
M/s. S. R. Batliboi & Co. LLP (Firm Registration Number 301003E/ E300005)Chartered Accountants who had been appointed as the Statutory Auditors of the Company fora period of 4 (four) years from the conclusion of the 29th Annual GeneralMeeting (AGM) of the Company until the conclusion of the 33rd AGM of theCompany for the Financial Year 2017- 18 has resigned as the Statutory Auditors of theCompany w.e.f. October 28 2016.
Further in order to fill the casual vacancy caused due to the aforesaid resignation ofM/s. S. R. Batliboi & Co. LLP Chartered Accountants the Members of the Companythrough the Postal Ballot process on December 29 2016 approved the appointment of M/s.Singhi & Co. (Firm Registration Number 302049E) Chartered Accountants as theStatutory Auditors of the Company w.e.f. November 02 2016 to hold the office till theconclusion of the ensuing AGM of the Company for the Financial Year 2016-17. Asrecommended by the Audit Committee the Board recommends the appointment of M/s. Singhi& Co. (Firm Registration Number 302049E) Chartered Accountants as the StatutoryAuditors of the Company to hold office from the conclusion of the ensuing 32ndAGM of the Company for the Financial Year 2016-17 till the conclusion of the 37thAGM of the Company for the Financial Year 2021-22.
The Notes on accounts referred to in the Auditors' Report are self-explanatory andtherefore do not call for any further explanations/comments. However the observations ofthe Auditors under the CARO Reporting with regard to the non- updation of the quantitativedetails of Fixed Assets and non-verification of the Fixed Assets of the Company physicallyduring the year was noted by the Audit Committee as the same being under process and isexpected to be completed during the Financial Year 2017-18.
M/s. Das & Prasad Chartered Accountants (Registration Number 303054E) wasappointed as the Internal Auditors of the Company to conduct the Internal Audit for theFinancial Year 2016-17. Further the Audit Committee considers and reviews the InternalAudit Report submitted by the Internal Auditor on a quarterly basis.
Details in respect of Fraud
During the Financial Year 2016-17 the Auditors have not reported any fraud asprescribed under Section 143(12) of the Act.
Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorsof the Company has appointed CS Nidhi Bagri of M/s. Nidhi Bagri & Company PracticingCompany Secretaries to conduct the Secretarial Audit of the Company for the FinancialYear 2016- 17. The Secretarial Audit Report in Form MR-3 for the Financial Year 2016-17is annexed hereto marked as 'Annexure - VII'. The Secretarial Audit Report does notcontain any qualification reservation adverse remark or disclaimer.
Material changes and commitments if any affecting the financial position of theCompany which have occurred between the end of the Financial Year of the Company to whichthe Financial Statements relate and the date of this Report
No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the Financial Year 2016-17 and the date of this Report.
Details of significant and material orders passed by the Regulators/ Courts/ Tribunalsimpacting the going concern status and the Company's operations in future
No such significant and material order has been passed by any Regulator/ Court/Tribunals against the Company which will impact the going concern status and theCompany's operations in future.
The Company has not accepted any deposit within the meaning of Section 73 of the Actand the Companies (Acceptance of Deposits) Rules 2014 during the Financial Year endedMarch 31 2017.
Particulars of Loans Guarantees or Investments
The Company did not give any loan or guarantee or made any investment under Section 186of the Act during the Financial Year ended March 31 2017. However the details of loangiven or investment made are provided in the Notes to the Financial Statements of theCompany.
Further the related party disclosures with respect to loans/ advances/ investments asat the Financial Year end under review and maximum outstanding amount thereof during theyear as required under Part A of Schedule V to the Listing Regulations have beenprovided in the Notes to the Financial Statements of the Company.
Particulars of Contracts or Arrangements with Related Parties
There were no materially significant related party transactions entered into by theCompany which may have potential conflict with the interest of the Company. All contracts/arrangements/ transactions entered by the Company during the Financial Year 2016-17 withits related parties were in the ordinary course of business and on an arm's length basisand were reviewed and approved by the Audit Committee of the Board. Further during thesaid Financial Year the Company has not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with theCompany's Policy on Materiality of Related Party Transactions except those provided inForm AOC-2 annexed hereto marked as 'Annexure - VIII'. Further suitable disclosure asrequired by the Accounting Standards has been made in the Notes to the FinancialStatements.
The Policy on dealing with Related Party Transactions is available on the website ofthe Company at the link http://rupa .co.in/site/wp-content/uploads/2015/10/policy-on-related-party-transactions.pdf
Management Discussion and Analysis Report
The Management Discussion and Analysis Report in terms of Regulation 34 read withSchedule V of the Listing Regulations forms part of this Annual Report.
Corporate Governance Report
The Corporate Governance Report in terms of Regulation 34(3) read with Schedule V ofthe Listing Regulations forms part of this Annual Report. The Company has obtained acertificate from the Statutory Auditors of the Company regarding compliance of conditionsof Corporate Governance and the same forms part of this Annual Report.
Business Responsibility Report
The Business Responsibility Report in terms of Regulation 34 of the ListingRegulations forms part of this Annual Report.
Disclosures under Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013
The Company is committed to provide a safe and conducive work environment to itsemployees and has formulated 'Policy for Prevention of Sexual Harassment' to prohibitprevent or deter any acts of sexual harassment at workplace and to provide the procedurefor the redressal of complaints pertaining to sexual harassment thereby providing a safeand healthy work environment.
However during the year under review no such incidence has been reported.
Directors' Responsibility Statement
To the best of our knowledge and belief and according to the information andexplanations obtained by us we hereby make the following statements in terms of Section134(3)(c) and 134(5) of the Act:
(i) that in the preparation of the Annual Accounts the applicable Accounting Standardshad been followed along with proper explanation relating to material departures if any;
(ii) that such accounting policies as mentioned in Notes to the Annual Accounts havebeen selected and applied consistently and judgment and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 31 2017 and of the profit of the Company for that period;
(iii) that proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities has been taken;
(iv) that the Annual Accounts has been prepared on a going concern basis;
(v) that proper systems to ensure compliance with the provisions of all applicable lawsare in place and that such systems were adequate and operating effectively; and
(vi) that internal financial control to be followed by the Company are in place andthat such internal financial controls are adequate and are operating effectively.
We thank our customers vendors bankers stakeholders and the Government for theircontinued support. We place on record our appreciation of the contribution made by ouremployees at all levels. Our consistent growth is possible because of their hard worksolidarity co-operation and support.
| ||By order of the Board |
| ||For Rupa & Company Limited |
| ||Sd/- |
| ||Prahlad Rai Agarwala |
|Place: Kolkata ||Chairman |
|Date: May 26 2017 ||DIN: 00847452 |