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Sagar Cements Ltd.

BSE: 502090 Sector: Industrials
NSE: SAGCEM ISIN Code: INE229C01013
BSE LIVE 15:40 | 08 Dec 827.10 -4.85
(-0.58%)
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847.60

HIGH

874.85

LOW

821.85

NSE 15:46 | 08 Dec 825.90 -3.45
(-0.42%)
OPEN

830.00

HIGH

844.90

LOW

820.00

OPEN 847.60
PREVIOUS CLOSE 831.95
VOLUME 2099
52-Week high 940.00
52-Week low 605.05
P/E 44.23
Mkt Cap.(Rs cr) 1,687
Buy Price 0.00
Buy Qty 0.00
Sell Price 827.10
Sell Qty 44.00
OPEN 847.60
CLOSE 831.95
VOLUME 2099
52-Week high 940.00
52-Week low 605.05
P/E 44.23
Mkt Cap.(Rs cr) 1,687
Buy Price 0.00
Buy Qty 0.00
Sell Price 827.10
Sell Qty 44.00

Sagar Cements Ltd. (SAGCEM) - Auditors Report

Company auditors report

To the Members of Sagar Cements Limited

1. This certificate is issued in accordance with the terms of our engagement letterdated October 17 2016.

2. We Deloitte Haskins & Sells Chartered Accountants the Statutory Auditors ofSagar Cements Limited ("the Company") have examined the compliance ofconditions of Corporate Governance by the Company for the year ended on March 31 2017 asstipulated in regulations 17 to 27 and clauses (b) to (i) of regulation 46(2) and para Cand D of schedule V of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (the Listing Regulations).

Managements* Responsibility

3. The compliance of conditions of Corporate Governance is the responsibility of theManagement. This responsibility includes the design implementation and maintenance ofinternal control and procedures to ensure the compliance with the conditions of theCorporate Governance stipulated in Listing Regulations.

Auditor*s Responsibility

4. Our responsibility is limited to examining the procedures and implementationthereof adopted by the Company for ensuring compliance with the conditions of theCorporate Governance. It is neither an audit nor an expression of opinion on the financialstatements of the Company.

5. We have examined the books of accounts and other relevant records and documentsmaintained by the Company for the purposes of providing reasonable assurance on thecompliance with Corporate Governance requirements by the Company.

6. We have carried out an examination of the relevant records of the Company inaccordance with the Guidance Note on Certification of Corporate Governance issued by theInstitute of the Chartered Accountants of India (the ICAI) the standards on Auditingspecified under Section 143(10) of the Companies Act 2013 in so far as applicable for thepurpose of this certificate and as per the Guidance Note on Reports or Certificates forSpecial Purposes issued by the ICAI which requires that we comply with the ethicalrequirements of the Code of Ethics issued by the ICAI.

7. We have complied with the relevant applicable requirements of the Standard onQuality Control (SQC) 1 Quality Controls for Firms that Perform Audits and Reviews ofHistorical Financial Information and Other Assurance and Related Services Engagements.

Opinion

8. Based on our examination of the relevant records and according to the informationand explanations provided to us and the representations provided by the Management wecertify that the Company has complied with the conditions of Corporate Governance asstipulated in regulations 17 to 27 and clauses (b) to (i) of regulation 46(2) and para Cand D of Schedule V of Listing Regulations during the year ended March 31 2017.

9. We state that such compliance is neither an assurance as to the future viability ofthe Company nor the efficiency or effectiveness with which the Management has conductedthe affairs of the Company.

For DELOITTE HASKINS & SELLS Chartered Accountants (Firm's Registration No.008072S)

Secunderabad May 29 2017

Ganesh Balakrishnan

Partner

(Membership No. 201193)

Sagar Cements Limited - Annual Report 2016-17

Independent Auditors' Report

To the Members of Sagar Cements Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SAGARCEMENTS LIMITED ("the Company") which comprise the Balance Sheet as at March312017 the Statement of Profit and Loss (including Other Comprehensive Income) the CashFlow Statement and the Statement of Changes in Equity for the year then ended and asummary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards (Ind AS) prescribedunder section 133 of the Act.

This responsibility also includes maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting frauds and other irregularities; selection and application ofappropriate accounting policies; making judgments and estimates that are reasonable andprudent; and design implementation and maintenance of adequate internal financialcontrols that were operating effectively for ensuring the accuracy and completeness ofthe accounting records relevant to the preparation and presentation of the standalone IndAS financial statements that give a true and fair view and are free from materialmisstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

In conducting our audit we have taken into account the provisions of the Act theaccounting and auditing standards and matters which are required to be included in theaudit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing specified under Section 143(10) of the Act. Those Standardsrequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence obtained by us is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India of the state of affairs of theCompany as at March 312017 and its profit total comprehensive income its cash flowsand the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143(3) of the Act based on our audit we report to theextent applicable that:

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit.

b) In our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome the Cash Flow Statement and Statement of Changes in Equity dealt with by thisReport are in agreement with the relevant books of account.

d) In our opinion the aforesaid standalone Ind AS financial statements comply with theIndian Accounting Standards prescribed under section 133 of the Act.

e) On the basis of the written representations received from the directors as on March312017 taken on record by the Board of Directors none of the directors is disqualifiedas on March 31 2017 from being appointed as a director in terms of Section 164(2) of theAct.

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate Report in "Annexure A". Our report expresses an unmodified opinion onthe adequacy and operating effectiveness of the Company's internal financial controls overfinancial reporting.

g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements.

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

iv. The Company has provided requisite disclosures in the standalone Ind AS financialstatements as regards its holding and dealings in Specified Bank Notes as defined in theNotification S.O. 3407(E) dated the November 08 2016 of the Ministry of Finance duringthe period from November 08 2016 to December 30 2016. Based on audit proceduresperformed and the representations provided to us by the management we report that thedisclosures are in accordance with the books of account maintained by the Company and asproduced to us by the Management.

2. As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government in terms of Section 143(11) of the Act we give in"Annexure B" a statement on the matters specified in paragraphs 3 and 4 of theOrder.

For DELOITTE HASKINS & SELLS

Chartered Accountants (Firm's Registration No. 008072S)

Ganesh Balakrishnan

Partner

Secunderabad May 29 2017 (Membership No. 201193)

ANNEXURE "A" TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph (f) under 'Report on Other Legal and Regulatory Requirements'of our report of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls over financial reporting of SAGARCEMENTS LIMITED ("the Company") as at March 312017 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information as required underthe Companies Act 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting(the "Guidance Note") issued by the Institute of Chartered Accountants of Indiaand the Standards on Auditing prescribed under Section 143(10) of the Companies Act 2013to the extent applicable to an audit of internal financial controls. Those Standards andthe Guidance Note require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether adequate internal financialcontrols over financial reporting was established and maintained and if such controlsoperated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgement including the assessment of the risks ofmaterial misstatement of the financial statements whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion to the best of our information and according to the explanations givento us the Company has in all material respects an adequate internal financial controlssystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2017 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note.

For DELOITTE HASKINS & SELLS

Chartered Accountants (Firm's Registration No. 008072S)

Ganesh Balakrishnan

Partner

Secunderabad May 29 2017 (Membership No. 201193)

ANNEXURE B TO THE INDEPENDENT AUDITORS' REPORT

(Referred to in paragraph 2 under 'Report on Other Legal and Regulatory Requirements'section of our report of even

date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of property plant and equipment.

(b) The Company has a program of verification of property plant and equipment to coverall the items in a phased manner over a period of three years which in our opinion isreasonable having regard to the size of the Company and the nature of its assets. Pursuantto the program certain property plant and equipment were physically verified by theManagement during the year. According to the information and explanations given to us nomaterial discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and the records examinedby us and based on the examination of the registered sale deed / transfer deed provided tous we report that the title deeds comprising all the immovable properties of land andbuildings which are freehold are held in the name of the Company as at the balance sheetdate. Immovable properties of land and buildings whose title deeds have been pledged assecurity for loans are held in the name of the Company based on the confirmations directlyreceived by us from lenders.

(ii) As explained to us the inventories were physically verified during the year bythe Management at reasonable intervals and no material discrepancies were noticed onphysical verification.

(iii) According to the information and explanations given to us the Company hadgranted unsecured loans to company covered in the register maintained under section 189 ofthe Companies Act 2013 in respect of which:

(a) The terms and conditions of the grant of such loans are in our opinion primafacie not prejudicial to the Company's interest.

(b) The schedule of repayment of principal and payment of interest has been stipulatedand repayments or receipts of principal amounts and interest have been regular as perstipulations.

(c) There is no overdue amount remaining outstanding as at the year end.

(iv) In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of Sections 185 and 186 of the Companies Act2013 in respect of grant of loans making investments and providing guarantees andsecurities as applicable.

(v) According to the information and explanations given to us the Company has notaccepted any deposit falling under the purview of the provisions of section 73 to 76 ofthe Companies Act 2013 during the year and does not have any unclaimed deposits andhence reporting under clause (v) of the order is not applicable.

(vi) The maintenance of cost records has been specified by the Central Government undersection 148(1) of the Companies Act 2013. We have broadly reviewed the cost recordsmaintained by the Company pursuant to the Companies (Cost Records and Audit) Rules 2014as amended prescribed by the Central Government under sub-section (1) of Section 148 ofthe Companies Act 2013 and are of the opinion that prima facie the prescribed costrecords have been made and maintained. We have however not made a detailed examinationof the cost records with a view to determine whether they are accurate or complete.

(vii) According to the information and explanations given to us in respect ofstatutory dues:

(a) Except for certain delays in payment of excise duty the Company has generally beenregular in depositing

undisputed statutory dues including Provident Fund Employees' State InsuranceIncome-tax Sales Tax Service Tax Customs Duty Value Added Tax cess and other materialstatutory dues applicable to it to the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident Fund Employees'State Insurance Income- tax Sales Tax Service Tax Customs Duty Excise Duty ValueAdded Tax cess and other material statutory dues in arrears as at March 312017 for aperiod of more than six months from the date they became payable.

(c) Details of dues of Income-tax Sales Tax Service Tax Customs Duty Excise Dutyand Value Added Tax which

have not been deposited as on March 312017 on account of disputes are given below:

Name of statue Nature of dues Forum where dispute is pending Period to which the amount relates Amount involved (7 lakhs) Amount unpaid (7 lakhs)
Central Excise Act 1944 Excise duty Customs Excise and Service Tax Appellate Tribunal (CESTAT) 2011-13 214 168
Commissioner of Appeals 2015-16 834 11
High Court of Telangana and Andhra Pradesh 2006-2010 1302 1302
Sales Tax and VAT Laws Sales tax and VAT Sales Tax Appellate Tribunal 1999-2000

2009-10

129 98
High Court of Telangana and Andhra Pradesh 2010-11 7 7
Customs Act 1962 Customs duty CESTAT 2012-13 193 189
Income Tax Act 1961 Income Tax Income Tax Appellate Tribunal 2005-06

2007-10

112 112
Commissioner of Income Tax (Appeals) 2008-09

2011-12

1088 924
Finance Act 1994 Service Tax CESTAT 2014-15 13 12

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in the repayment of loans or borrowings to financialinstitutions banks and government except as under:

Particulars

Amount of default of repayment (7 in lakhs)

Period of default

(in days)

Instalment Interest
State Bank of India 616 50 1-8 days

The Company has not issued any debentures.

(ix) The Company has not raised moneys by way of initial public offer or further publicoffer (including debt instruments). In our opinion and according to the information andexplanations given to us money raised by way of term loans have been applied by theCompany during the year for the purposes for which they were raised other than temporarydeployment pending application of proceeds.

(x) To the best of our knowledge and according to the information and explanationsgiven to us no material fraud by the Company and no material fraud on the Company by itsofficers or employees has been noticed or reported during the year.

(xi) In our opinion and according to the information and explanations given to us theCompany has paid / provided managerial remuneration in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of theOrder is not applicable.

(xiii) In our opinion and according to the information and explanations given to us theCompany is in compliance with Section 188 and 177 of the Companies Act 2013 whereapplicable for all transactions with the related parties and the details of related partytransactions have been disclosed in the financial statements etc. as required by theapplicable accounting standards.

(xiv) According to the information and explanations given to us the Company has madepreferential allotment of shares during the year under review.

In respect of the above issue we further report that:

a) the requirement of Section 42 of the Companies Act 2013 as applicable have beencomplied with; and

b) the amounts raised have been applied by the Company during the year for the purposesfor which the funds were raised other than temporary deployment pending application.

(xv) In our opinion and according to the information and explanations given to usduring the year the Company has not entered into any non-cash transactions with itsdirectors or persons connected with him and hence provisions of section 192 of theCompanies Act 2013 are not applicable.

(xvi) The Company is not required to be registered under section 45-I of the ReserveBank of India Act 1934.

For DELOITTE HASKINS & SELLS

Chartered Accountants (Firm's Registration No. 008072S)

Ganesh Balakrishnan

Partner

Secunderabad May 29 2017 (Membership No. 201193)