SAGAR PRODUCTIONS LIMITED
Your Directors are pleased to present their 37thAnnual Report together with theAudited Financial Statements for the financial year ended 31st March 2016 and theAuditors Report thereon.
| || ||(Rs. In Lacs) |
|Particulars ||Year Ended 31-03-2016 ||Year Ended 31-03-2015 |
|Total Revenue ||90.73 ||0.60 |
|Profit before depreciation and Tax ||- ||(6.14) |
|Less: Depreciation ||- ||- |
|Profit after depreciation and before Tax ||1.05 ||(6.14) |
|Less : Provision For Tax ||0.35 ||- |
|Less : Deffered Tax ||- ||- |
|Less : Short/ Excess earlier year ||- ||(4.95) |
|Net Profit ||0.70 ||(11.17) |
|Add: Profit & Loss A/c balance of previous || || |
|years ||(555.20) ||(544.03) |
|Appropriations: || || |
|Transfer to Capital Reduction Reserve ||523.43 ||- |
|Proposed Dividend ||- ||- |
|Interim Dividend ||- ||- |
|Dividend Distribution Tax ||- ||- |
|Transfer to General Reserve ||- ||- |
|Balance c/f to Balance Sheet ||(31.07) ||(555.20) |
Operations and Future Plans
Your Company wishes to inform that the total revenue earned by the Company was Rs.90.73 Lakhs as compared to Rs. 0.60 Lakhs of the previous year. Due to increase inoperations of the Company the expenses of the Company have also surged substantiallythereby recording a net profit of Rs. 0.70 Lakhs as compared to loss of Rs. 11.03 Lakhs inthe year 2014-15.
Your Directors are delighted that after booking losses since many years Company hasseen a profit and are optimistic that the upward trend shall continue to follow.
In order to plough back the profit your Directors have not recommended any dividendfor the year ended 31st March 2016.
The Issued Subscribed & Paid up Capital of the Company as on 31st March 2016stands at Rs. 40142125/- divided into 40142125 Equity Shares of Rs. 1/- each.
Reduction of Share capital:
During the year under review the Honble Bombay High Court vide its order dated18th April 2015 approved the Scheme of Arrangement. In accordance with the Scheme yourCompany had carried out reduction of the Share capital in the following manner:
i. The Company had consolidated its then Authorized Share Capital of Rs. 60000000/-divided into 60000000 Equity Shares of Re.1/- each and paid-up capital of Rs.53685000/- divided into 53685000 Equity Shares of Re.1/- each in such manner thatevery 40 existing Equity shares of Re. 1/- each constitutes one share of Rs. 40/- eachfully paid-up thereby restructuring it into Authorized Share Capital of Rs. 60000000/-divided into 1500000 Equity Shares of Rs. 40/- each and paid-up capital of Rs.53685000/- divided into 1342125 Equity Shares of Rs.40/- each.
ii. Post consolidation the Company had reduced the paid-up share capital from thenexisting Rs. 53685000/- divided into 1342125 Equity Shares of Rs. 40/- each to Rs.1342125/- divided into 1342125 shares of Re. 1/- each by cancelling capital of Rs.39/- upon each of the 1342125 Equity Shares of Rs. 40/- each and thereby reducing thenominal value of shares from Rs. 40/- each to Re. 1/- each.
iii. After completion of the abovementioned cancellation and reduction the paid upCapital stood at Rs. 1342125/- divided into 1342125 Equity Shares of Re. 1/- each andthe Authorized Share Capital of the Company was reorganized in such a manner that Rs.60000000/- divided into 1500000 Equity Shares of Rs. 40/- each was furthersub-divided into 60000000 Equity Shares of Re. 1/- each. The Authorized Share Capitalafter this arrangement stood at Rs. 60000000/- divided into 60000000 Equity Sharesof Re. 1/- each.
Pursuant to the Scheme of Arrangement Company had made preferential allotment of38800000 Fully Convertible Warrants of Re. 1/- each on 29th May 2015 to Promoters& Non-Promoters after receipt of 25% of the issue price from the subscribers. Postreceipt of the remaining issue price the said warrants were converted into 38800000fully paid Equity Shares of Re. 1/- each on 23rd October 2015. The said shares were dulylisted on Bombay Stock Exchange and are subject to lock-in. The Company had fully abidewith the applicable provisions of sections 62(1)(c) of the Companies Act 2013 alongwithother applicable provisions of the Companies Act 1956 and SEBI (ICDR)Regulations 2009to the extent it was required.
Transfer to Reserve
The Board does not propose to make transfer to reserves for the year 2015-16 andinstead intends to retain the net profit in the Profit & Loss Account for the yearended 31st March 2016.
Directors and Key Managerial Personnel
In accordance with the provisions of Section 152 of the Act and that of Articles ofAssociation of the Company Mr. Kalakad Sathi (DIN: 00150876) Whole-time Director of theCompany retires by rotation at this Annual General Meeting of the Company and beingeligible offers himself for reappointment.
During the year review Mr. Ramavtar Kankani had resigned from the Board citingpersonal issue. The Board had approved his resignation with effect from 23th October 2015and placed its appreciation towards the guidance provided by Mr. Kankani during his tenurewith the Company.
Your Board has carried out an annual evaluation of its own performance Boardcommittees and individual Directors pursuant to the provisions of the Act and thecorporate governance requirements as prescribed by SEBI (Listing Obligations andDisclosures Requirement) 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.
Board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the Board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.
Meetings of the Board
During the year ended 31st March 2016 Six (6) Board Meetings were held by the Companyon 25th May 2015; 29th May 2015; 10th June 2015; 13th August 2015; 23rd October 2015and 12th February 2016. The intervening gap between the Meetings was within the period asprescribed under the Companies Act 2013 & Listing Regulations.
Details of Committees of the Board
Currently the Company has three (3) Committees namely Audit Committee Nomination andRemuneration Committee & Stakeholders Relationship Committee. The detailedcomposition of various Committees is elucidated below:
i) Audit Committee
The Audit Committee comprises of three Directors namely Mr. Jitendra Keny(Non-Executive Independent) Mr. Kalakad Sathi (Executive) and *Mrs. HemlataChanda (Non-Executive Independent). The Chairman of the Committee is Mr. Jitendra Kenywho is an Independent Non-Executive Director. The recommendations of the Audit Committeeare always welcomed and accepted by the Board & all the steps impacting the financialsof the Company are undertaken only after the consultation of the Audit Committee. Duringthe period ended 31st March 2016 four (4) Meetings of Audit Committee were held on 29thMay 2015; 13th August 2015; 23rd October 2015 and 12th February 2016.
*The Audit Committee was reconstituted in the Board Meeting held on 23rd October2015 following the resignation of Mr. Ramavtar Kankani from the Directorship of theCompany. Hence in his place Mrs. Hemlata Chanda was admitted in the Committee. ii)Nomination & Remuneration Committee
The Committee was constituted in accordance with the provisions under Section 178 ofthe Companies Act 2013. The Committee consists of three (3) Members namely Mr. JitendraKeny (Non-Executive Independent Director) Mr. Kalakad Sathi(Executive Director) and*Mrs. Hemlata Chanda (Non-Executive Independent Director). The Committee ischaired by Mr. Jitendra Keny. During the year ended 31st March 2016 one (1)Committee Meeting was held on 25th May 2015.
*Post the resignation of Mr. Ramavtar Kanakani from the Directorship of the Companythe Committee was reconstituted in the Board Meeting held on 23rd October 2015 as Mr.Kankani held membership in the Committee. Mrs. Hemlata Chanda (Non-Executive IndependentDirector) was admitted in the Committee in place of Mr. Kankani.
Nomination and Remuneration Committee Policy
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy forms part of this report as Annexure - I.
iii) Stakeholders Relationship Committee
The Committee oversees all the matters relating toStakeholdersgrievances/complaints. The role of the Committee is to consider &resolve securities holders complaint. The Committee consists of three membersnamely Mrs. Hemlata Chanda (Non-executive Independent) Mr. Jitendra Keny (Non-executiveIndependent) and Mr. Kalakad Sathi (Executive). The Committee is chaired by *Mrs. HemlataChanda. During the year ended 31st March 2016 four (4) Committee Meetings were held on29th May 2015; 13th August 2015; 23rd October 2015 and 12th February 2016.
*The Stakeholders Relationship Committee was reconstituted in the BoardMeeting held on 23rd October 2015 following the resignation of Mr. Ramavtar Kankani fromthe Directorship of the Company. Hence in his place Mrs. Hemlata Chanda was admitted& designated as a Chairperson of the Committee.
Declaration of Independence from Independent Directors
Your Company has received declarations pursuant to Section 149(7) of the Companies Act2013 from all the Independent Directors confirming that they meet the criteria ofindependence laid down under Section 149(6) of the Companies Act 2013. Based on thedeclaration(s) of Independent Directors the Board of Directors recorded its opinion thatall Independent Directors are independent of the Management and have fulfilled theconditions as specified in the Companies Act 2013 rules made thereunder as well asapplicable provisions of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act 2013 the Directors of your Companyconfirm that:
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit and loss of the company for that period;
c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts on a going concern basis;
e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively and
f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
Change in the Nature of Business
During the period under review there is no change in the nature of business of theCompany. The Company continues to operate in the Media Sector.
Extract of Annual Return
The extract of Annual Return in Form MGT-9 as required under Section 92 of theCompanies Act 2013 (herein after referred to as "the Act") forms an integralpart of this Report as "Annexure -II".
Sexual Harassment Policy
In order to prevent sexual harassment at workplace your Company has adopted a Policyon prevention prohibition and redressal of sexual harassment at workplace in line withthe requirements of the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 and Rule made thereunder. During the year under review therewere no cases filed or reported pursuant to the provisions of the said Act.
Auditors & their Report
a) Statutory Auditor:
At the AGM held on 30th September 2015 for the Financial year ended 2014-15 theMembers have approved & accorded their assent for appointment of M/s. Sudhir M Desai& Co. Chartered Accountants as Statutory Auditors of the Company to hold office fromthe conclusion of the 36th Annual General Meeting until the conclusion of the 41st AnnualGeneral Meeting of the Company to be held in the year 2020 subject to the ratification ofthe Members at every Annual General Meeting. Also the Company has received a letter fromAuditors to the effect that their appointment if made it would be within the prescribedlimits under Section 139 of the Companies Act 2013.
The Statutory Auditors M/s. Sudhir M. Desai & Co. have issued their reports onStandalone Financial Statements for the year ended 31st March 2016. There are no adverseremarks or qualifications in the said report. The Notes on Accounts referred to in theAuditors Report are self-explanatory and do not call for any further comments.
b) Secretarial Auditor:
In compliance with the provisions of Sec 204 and other applicable provisions ofCompanies Act 2013 the Board of Directors have appointed M/s. Rituraj & AssociatesPractising Company Secretary as Secretarial Auditors to undertake secretarial audit of theCompany for the financial year ended 31st March 2016. The Secretarial Audit Report isannexed herewith as Annexure -III and forms an integral part of this report.
Secretarial Auditor has made and mentioned the following observation in its report:
The Company has not appointed Chief Financial Officer (CFO) and Company Secretary aswhole time Key Managerial Personnel under section 203 of the Companies Act 2013 read withRule 8 of the Companies (Appointment of and Remuneration of Managerial Personnel) Rules2014.
With regards to the observation made above your Board clarifies that the Company afterdeliberation have made various efforts for recruitment of the aforesaid Key ManagerialPersonnel. However as you are aware that the Company had made huge losses in last decadeand is currently in the stage of recovery. The Company had made every attempt to searchsuitable candidates for aforesaid positions during the year and assures that the samepositions will be filled within short span.
Risk Management is the process of identification assessment and prioritization ofrisks followed by coordinated efforts to minimize monitor and mitigate/control theprobability and/or impact of unfortunate events or to maximize the realization ofopportunities. The Company has laid a comprehensive Risk Assessment and MinimizationProcedure which is reviewed by the Audit committee and approved by the Board from time totime. These procedures are reviewed to ensure that executive management controls riskthrough means of a properly defined framework. The policy has been hosted onCompanys website www.sagarproductions.com
Internal Control Systems and their Adequacy
The Company has adequate system of internal details of the Policy have been posted onthe control to safeguard and protect from loss unauthorized use or disposition of itsassets. All the transactions are properly authorized recorded and reported to theManagement. Internal Audit is carried out in a programmed way and follow up actions weretaken for all audit observations. Your Company's Statutory Auditors have in their reportconfirmed the adequacy of the internal control procedures.
The Company has not accepted any deposit from the general public within the meaning ofsection 73 of the Companies Act 2013 and the rules made there under.
Particulars of Contracts/ Arrangements with Related Party
During the year there were no related party transactions made in the Companytherefore Form AOC-2 is not applicable to the Company. The policy on materiality ofrelated party transactions and dealing with related party transactions as approved by theBoard may be accessed on the Companys website at the link: http://www.sagarproductions.com/images/pdf/Policy%20on%20Related%20Party%20Transactions.pdf
Particulars of Loans Guarantees or Investments by the Company under section186
During the year ended 31st March 2016 the Company has not given any loans orguarantees covered under the provisions of Section 186 of the Companies Act 2013.
Material Changes affecting the financial position of the Company
There have been no material changes affecting the financial position of the Companywhich have occurred between the end of the financial year of the Company to which thefinancial statements relate and the date of the Report.
Corporate Social Responsibility Committee
The prerequisite in terms of Section 135 of the Companies Act 2013 of corporate socialresponsibility does not apply to the Company. However your Company endeavours to involveitself in social development activities as and when required.
Dematerialisation of Shares
Your Company has availed connectivity with both the Depositories i.e. NationalSecurities Depository Limited (NSDL) & Central Depository Services (India) Limited(CDSL) for dematerialization of its Equity Shares. The ISIN No. INE807D01030 hasbeen allotted for the Company Shares.
As on 31st March 2016 3.33% of the paid up Equity Share Capital stands in Demat modeand the remaining 96.67% Equity Shares were held in physical mode the details of whichare as follows:
|Particulars ||No. of Shares ||% of Total Capital |
|Held in Demat form with CDSL ||550281 ||1.37 |
|Held in Demat form with NSDL ||789489 ||1.97 |
|Held in physical mode ||38802355 ||96.66 |
The reason for lesser holding in demat form is that the Corporate Action forPreferential Allotment of Equity Shares was not completed till 31st March 2016 andtherefore the Shares allotted post conversion of warrants were in physical mode which weresubsequently transferred to holders account in demat form.
Listing of Shares
The shares of your Company are listed at BSE Limited. The applicable Annual Listingfees have been paid to the Stock Exchange for the financial year 2015-16.
During the year Company had approached BSE Ltd twice for listing of its shares thedetails of which are as follows:
i. On 25th August 2015 BSE Ltd granted listing approval to the Company with respectto the listing of 1342125 shares post reduction of Share Capital;
ii. On 04th December 2015 BSE Ltd had granted listing approval for 38800000 EquityShares allotted post conversion of warrants.
Execution of Listing Agreement
The Securities and Exchange Board of India ("SEBI") on 2nd September 2015issued SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015(hereinafter referred to as the "Listing Regulations") with an aim toconsolidate and streamline the provisions of the Listing Regulations for differentsegments of capital markets to ensure better enforceability. In furtherance to the sameSEBI issued Circular No. CIR/CFD/CMD/6/2015 dated October 13 2015 which requires everyexisting Listed Company which has previously entered into Listing Agreement with a StockExchange to execute a fresh listing agreement with the respective Stock Exchange withinsix months of the date of notification of the said regulations. Your Company has entered& executed the Listing Agreement with BSE Limited in the month of February 2016.
Adoption of various Policies
During the year the Company had adopted certain policies as prescribed under SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
Prevention of Insider Trading
The Company has also adopted "Code of Internal Procedures and Conduct forRegulating Monitoring and Reporting of Trading by Insiders" and "Code ofPractices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information(UPSI)". All the Directors Senior Management employees and other employees who haveaccess to the unpublished price sensitive information of the Company are governed by thiscode.
Vigil Mechanism/Whistle Blower Policy
The Board of Directors of Company has pursuant to the provisions of Section 178(9) ofthe Companies Act 2013 read with Rule 7 of the Companies (Meetings of Board and itsPowers) Rules 2014 framed "Vigil
Mechanism / Whistle Blower Policy" for Directors and employees of the Company toprovide a mechanism which ensures adequate safeguards to employees and Directors from anyvictimization on raising of concerns of any violations of legal or regulatoryrequirements incorrect or misrepresentation of any financial statements and reportsetc. The employees of the Company have the right/option to report their concern/ grievanceto the Chairman of the Audit Committee who is entrusted with the responsibility to overseethe Vigil mechanism. The policy same is also available on the web-site at the web-link http://www.sagarproductions.com/images/pdf/Whistle%20Blower%20Policy.pdf
In terms of Regulation 15(1) of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015 the provisions related to Corporate Governance asspecified in Regulation 17 to 27 and Clause (b) to (i) of sub-regulation (2) of regulation46 and para C D and E of schedule V shall not be applicable to the Company as theCompanys paid up equity share capital is less than Rs.10 crore and Net worth doesnot exceed Rs.25 crore. Hence the company is not providing a separate report on corporategovernance and also a certificate from the Companys Auditors confirming thecompliance of Corporate Governance.
Secretarial Standards of ICSI
Pursuant to the approval given on 10th April 2015 by the Central Government to theSecretarial Standards specified by the Institute of Company Secretaries of India theSecretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings(SS-2) came into effect from 1st July 2015. The Company is in compliance with the same.
Significant and Material Orders Passed by the Regulators or Courts
The Honble High Court of Bombay has passed an order on 18th April 2015 approvingthe Scheme of Arrangement between the Company and its Equity Shareholders. In terms of theScheme the paid up Share Capital of the Company had reduced and the Company had made apreferential allotment. The order as received from the Court was submitted with Registrarof Companies Mumbai Regional Director BSE Limited etc. within the specified timeframe.
Management Discussion and Analysis
Management Discussion and Analysis Report is appended as "Annexure - IV"to this Report.
Particulars of Employees
Particulars of employees in accordance with the provisions of Section 197 of theCompanies Act 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are not given as none of the employees qualifies forsuch disclosure.
Conservation of Energy Technology Absorption and Foreign Exchange Earning & Outgo
There was no technology absorption and no foreign exchange earnings or outgo duringthe year under review. Hence the information as required under Section 134(3)(m) of theCompanies Act 2013 read with the Companies (Accounts) Rules 2014 is to be regarded asNil. The Company has not entered into any technology transfer agreement.
Your Directors take this opportunity to express their grateful appreciation for theexcellent assistance and cooperation received from all our Clients Bankers BusinessAssociates and the Government and other regulatory authorities and thank all stakeholdersfor their valuable sustained support and encouragement towards the conduct of theproficient operation of the Company. Your Directors would like to place on record theirgratitude to all the employees who have continued their support during the year.
| ||By Order of the Board of Directors || |
| ||For Sagar Productions Limited || |
| ||-Sd/- ||-Sd/- |
|Place: Mumbai ||Kalakad Sathi ||Deepak Mardhekar |
|Date: 27.05.2016 ||Whole Time Director ||Director |
| ||(DIN: 00150876) ||(DIN: 06985092) |