Samruddhi Realty Ltd.
|BSE: 535466||Sector: Infrastructure|
|NSE: N.A.||ISIN Code: INE621O01016|
|BSE LIVE 14:35 | 30 May||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
|BSE: 535466||Sector: Infrastructure|
|NSE: N.A.||ISIN Code: INE621O01016|
|BSE LIVE 14:35 | 30 May||Stock Is Not Traded.|
|NSE 05:30 | 01 Jan||Stock Is Not Traded.|
We are pleased to present the THIRTEENTH ANNUAL REPORT AND AUDITED ACCOUNTS of thecompany for the financial year ended on 31st March 2016.
NATURE O F BUSINESS
The Company is engaged in the business of Real Estate Development. The Company developsresidential projects. There was no change in the nature of the business of the Companyduring the year under review.
During the year under review the Company earned a profit before tax of Rs. 2.85 croresas compared to Rs. 3.28 crores in the corresponding previous year representing adecrease of 13.27%. The Company earned a profit after tax of Rs. 1.79 croresas compared to Rs. 2.03 crores in the previous year representing a decrease of 11.70%.
TRANSFER TO RESERVES
It is not proposed to transferany amountout of the current profits to General Reserve.
The Company is in the phase of adding new projects in its portfolio. These new projectswould help improve overall Return onCapital Employed and wouldadd value to theshareholder's wealth. The Boardbelieves that conserving and investing theCompany'scapital in high return investment
opportunitiescurrently available instead of distributing it as a dividendwill maximizeshareholder value creation. Keeping this in mind the Boardfelt that the Company utilizethe internal accruals on itsprojects rather than paying dividend to shareholders.TheDirectors have therefore not recommended anydividend for the financial year ended March 31st2016.
There is no balance lying in the unpaid equity dividend account of the Company.
ASSOCIATE AND JOINT VENTURE COMPANIES
The Company has one wholly owned subsidiary viz. Samruddhi Gruha Nirman PrivateLimited. There are three associate companies viz. Samruddhi Real Assets Private LimitedStudio 3 Planners Private Limited and Samruddhi Infratech (India) Private Limited. Thereare no joint venture companies within the meaning of Section 2(6) of the Companies Act2013 (the Act').
As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and Section 129 of the Companies Act the consolidated financial statements have beenprepared by the Company in accordance with the applicable accounting standards and formpart of the Annual Report. A statement containing the salient features of the FinancialStatements of the subsidiaries joint ventures and associate companies of the Company inForm AOC-1 as required under Rule 5 of the Companies (Accounts) Rules 2014 form part ofthe notes to the consolidated financial statements.
The Company shall provide a copy of the financial statements of its subsidiary companyto the members of the Company on their request. The financial statements of its subsidiarycompany will also be kept open for inspection by any members at the registered office ofthe Company during business hours of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. V R Manjunathretires by rotation at the forthcoming Annual General Meeting andbeing eligible offer himself for re- appointment.
Mr. Srinivas Gulur Seshagirirao resigned as Independent Director of the company witheffect from 22.12.2015. The Board of Directors places on record their sincere appreciationof the valuable contribution made by him to the company.
Mr. Jatin GunvantrayPareekh was appointed as an Additional Director of the Company asalso an Independent Director not liable to retire by rotation with effect from 11thJanuary 2016 subject to the approval of the Members. Brief resume of Mr. Jhtin Pareekhnature of his experience in specific functional areas names of the companies in which heholds directorship and membership/ chairmanship of board committees shareholding andrelationship between directors inter-se as stipulated under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are provided in the Notice for convening theAnnual General Meeting.
There was no change in any Key Managerial Personnel of the Company during the year.
During the period under review M/ S. A. R. PAI & CO Chartered Accountantsresigned as Statutory Auditors of the company. In the Extra Ordinary General Meeting heldon the 26th May 2016 M/ s. K. Gopalkrishnan & Co. Chartered AccountantsBangalore were appointed as Statutory Auditors of the Company to conduct the StatutoryAudit for the period ended 31stMarch 2016. M/ s. K. Gopalkrishnan & Co.Chartered Accountants hold office until the conclusion of the ensuing Annual GeneralMeeting and are recommended for appointment for 4 (four) consecutive years from the dateof the 13thAnnual General Meeting (AGM) for a term upto the conclusion of 17thAGMof the
Company in the Calendar year 2020 (subject to ratification of the appointment by themembers at every AGM held after this AGM). The company has obtained a certificate from M/s. K. Gopalkrishnan & Co. Chartered Accountants to the effect that their proposedre-appointment if made would be in accordance and conformity with the specified limits.
The Audit Committee has considered and recommended the appointment of M/ S. K.Gopalkrishnan & Co. Bangalore as Statutory Auditors of the Company to the Board ofDirectors. The Directors have accepted the recommendation and recommend to theshareholders the appointment of M/ S. K. Gopalkrishnan & Co Chartered AccountantsBangalore as the Statutory Auditors of the Company.
Necessary resolution for appointment of the said Auditors is included in the Notice ofAnnual General Meeting for seeking approval of members.
The Board has appointed Mr. Kiran Kumar K.Chartered Accountant as the Internal Auditorof the company for the financial year 2016-17
The observations made by the Auditors in their Report referring to the Notes formingpart of the Accounts are self-explanatory and therefore do not require any furtherexplanation or comments from the Board under Section 134(3) of the Companies Act 2013.
DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT 2013
Except as disclosed elsewhere in this report no material changes and commitments whichcould affect the Company's financial position have occurred between the end of thefinancial year of the Company and the date of this report.
INTERNAL FINANCIAL CONTROLS
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate.
During the year under review no material or serious observation has been received fromthe Internal Auditors of the Company for inefficiency or inadequacy of such controls.
PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
During the year the Company purchased two villas from M/ S. Samruddhi Constructions apartnership firm in which Mr. Hemang D Rawal & Mr. Ravindra M Madhudi are partners.This related party transaction was approved by the Board of Directors in the Board meetingheld on 13th August 2015 and subsequently ratified by the shareholders in theAnnual General Meeting held on 29th September 2015. The disclosures in formAOC-2 form part of the notes to the consolidated financial statements.
Except the above transaction all other related party transactions that were enteredinto during the financial year were on an arm's length basis and were in the ordinarycourse of business and that the provisions of Section 188 of the Companies Act 2013 arenot attracted. Further there are no other materially significant related partytransactions made by the Company with Promoters Directors Key Managerial Personnel orother designated persons which may have a potential conflict with the interest of theCompany at large.
None of the Directors has any pecuniary relationships or transactions vis-a-vis theCompany.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statements.
DECLARATIONS BY INDEPENDENT DIRECTORS
Pursuant to the provisions of sub-section (7) of Section 149 of the Companies Act2013 the Company has received individual declarations from all the Independent Directorsconfirming that they fulfil the criteria of independence as specified in Section 149(6) ofthe Companies Act 2013.
MEETINGS OF THE BOARD
The Board of Directors met sixteen times during the financial year ended March 31 2016in accordance with the provisions of the Companies Act 2013 and rules made thereunder.All the Directors actively participated in the meetings and contributed valuable inputs onthe matters brought before the Board of Directors from time to time. The details of themeetings are given in Corporate Governance Report which forms part of this Report.
Additionally during the financial year ended March 31 2016 the Independent Directorsheld a separate meeting in compliance with the requirements of Schedule IV of theCompanies Act 2013 and the Listing Regulations.
The details of other committeemeetings are given in the Corporate Governance Reportwhich forms part of this report.
The Audit Committee comprises Mr. JhtinGunvantray Pareekh as Chairman Mr. Hemang DRawal andMs. Sushma T S as members. All the recommendations made by the Audit Committeewere accepted by the Board.
DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act 2013 in relation to the auditedfinancial statements of the Company for the year ended March 31 2016 the Board ofDirectors hereby confirms that:
a. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b. such accounting policies have been selected and applied consistently and theDirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as on March 31 2016 and of theprofits of the Company for the year ended on that date;
c. proper and sufficient care was taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts of the Company have been prepared on a going concern basis;
e. internal financial controls have been laid down to be followed by the Company andthat such internal financial controls are adequate and were operating effectively;
f. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company has a practice of conducting familiarization programme for IndependentDirectors of the Company. At the time of appointment a formal letter of appointment isgiven to Independent Directors which inter-alia explains the role functionsduties and responsibilities expected from them as a Director of the Company. The Companyconducts structure orientation programmes for the Independent Directors to understand andget updates on the business and operations of the Company on a continuous basis. Suchprogrammes provide an opportunity to the Independent Directors to interact with SeniorLeadership team of the Company and help them to understand the Company's strategy modelsoperations services product-offerings finance human resources and such other areas asmay arise from time to time.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In compliance with the provisions of Section 177(9) of the Companies Act 2013 theBoard of Directors of the Company has framed the "Whistle Blower Policy" as thevigil mechanism for Directors and employees of the Company. The Whistle Blower Policy isdisclosed on the website of the Company at www.samruddhirealty.com.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has formulated a Risk Management Policy whichaims at enhancing shareholders' value and providing an optimum risk reward trade off. Therisk management approach is based on a clear understanding of the variety of risks thatthe organisation faces disciplined risk monitoring and measurement and continuous riskassessment and mitigation measures.
Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations astructured questionnaire was prepared after taking into consideration inputs received fromthe Directors covering various aspects of the Board's functioning composition of theBoard and its committees culture execution and performance of specific dutiesobligations and governance. The performance evaluation of the Independent Directors wascarried out by the entire Board. The performance evaluation of the Chairman and theNon-Independent Directors was carried out by the Independent Directors. The Directorsexpressed their satisfaction with the evaluation process.
EXTRACT OF ANNUAL RETURN
Pursuant to the provisions of Section 134(3)(a) of the Companies Act 2013 extract ofthe Annual Return for the financial year ended March 31 2016 made under the provisions ofSection 92(3) is attached as Annexure - 1 which forms part of this Report.
PARTICULARS OF EMPLOYEES AND REMUNERATION
During the year there was no employee in receipt of remuneration as prescribed in theRule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. The prescribed particulars of Employees as required under Section 197 (12) of theAct read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is attached as Annexure - 2 and forms part of this Report.
As on March 31 2016 there were 67 permanent employees.
REMUNERATION AND NOMINATION POLICY
The Board has framed a policy for selection and appointment of Directors SeniorManagement and their remuneration. The details of this Policy are attached as Annexure-3to this report.
STATEMENT PURSUANT TO LISTING AGREEMENT
The Company's equity shares are listed at Bombay Stock Exchange Limited (SME segment).The Annual listing fee for the year 2016-17 has been paid.
As required under the provisions of Section 204 of the Companies Act 2013 the reportin respect of the Secretarial Audit carried out by Mr. V. C. Krishnamurthy PractisingCompany Secretary in Form MR-3 for the FY 2015-16 is attached as Annexure - 4 to thisreport. The said report does not contain any adverse observation or qualificationrequiring explanation or comments from the Board under Section 134(3) of the CompaniesAct 2013.
The Company has complied with the provisions of Corporate Governance as stipulated inthe Listing Regulations. A separate report on Corporate Governance along with therequisite Auditors' Certificate is annexed and forms part of this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis Report has been separately furnished in theAnnual Report.
During the year employee relations continued to be cordial and harmonious at all levelsand in all divisions of the Company. There was a total understanding of the managementobjectives by the employees. The Company has consistently tried to improve its HR policiesand processes so as to acquire nurture & retain the best of the available talent inthe Industry.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
Considering the Company's business activities the Directors have nothing to reportunder Section 134(3)(m) of the Companies Act 2013 read with Rule 8(3) of the Companies(Accounts ) Rules 2014 with reference to Conservation of Energy & TechnologyAbsorption.
The transaction involving foreign exchanges during the year are as below:
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
Details relating to deposits covered under Chapter V of the Act
Disclosure relating to equity shares with differential rights
Disclosure relating to sweat equity shares
Disclosure relating to employee stock option scheme
Disclosure in respect of voting rights not directly exercised by the employees
Disclosure of significant or material orders passed by the Regulators or Courtsor Tribunals which impact the going concern status and Company's operations in future.
Disclosure under Section 134(3)(o) of the Companies Act 2013 and the Companies(Corporate Social Responsibility Policy) Rules 2014 since the Company is not coveredunder Section 135 of theCompanies Act 2013.
DISCLOSURE UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT 2013
The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013 (the said Act') has been made effective w.e.f. December 9 2013. It is anAct to provide protection against sexual harassment of women at workplace and for theprevention and redressal of complaints of sexual harassment and for matters connectedtherewith or incidental thereto. The Company has constituted an Internal ComplaintCommittee (ICC') as required by the said Act. The Company is strongly opposed tosexual harassment and employees are made aware about the consequences of such acts andabout the constitution of ICC.
During the year under review no complaints were filed with the Committee under theprovisions of the said Act.
The Board of Directors wishes to thank the Central Government State Government RBISEBI and The Bombay Stock Exchange Limited (BSE) for their co-operation in variousspheres of Company's functions. The Board of Directors expresses its gratitude for theco-operation extended by the Financial Institutions / Term Lenders and Company's Bankersfor their valuable support. The Directors thank all the shareholders of the Company itscustomers and investors for their valuable support during the year and look forward totheir continued support in the years to come. The Company has also gained considerablyfrom the sincere and devoted services rendered by its employees at all levels. The Boardof Directors wishes to place on record its sincere appreciation of the employee's effortsin enhancing the image of the company in the market.