To the Members
Your Directors have pleasure in presen ng the 20th Annual Report on the working of theCompany together with the audited accounts for the year ended 31st March 2016.
The financial results of the Company as prescribed in the said Accounts are summarizedbelow :
|Par culars ||2015-16 ||2014-15 |
| ||(Rs. In lacs) ||(Rs. In lacs) |
|Revenue from operations (Net) ||9601.50 ||9443.14 |
|Other Income ||151.22 ||122.41 |
|Total Revenue ||9752.72 ||9565.55 |
|Less : Total Expenses ||8347.56 ||7968.42 |
|Profit before Finance Cost and Deprecia on ||1405.16 ||1597.13 |
|Less : Finance Cost ||800.74 ||862.04 |
|Deprecia on and Amor za on Expense ||593.80 ||598.82 |
|Profit before excep onal/extra-ordinary items ||10.62 ||136.27 |
|Add : Excep onal Items ||-- ||2.18 |
|Less : Extraordinary items ||-- ||68.65 |
|Profit before Tax ||10.62 ||69.80 |
|Add : Deferred Tax ||-- ||-- |
|Profit for the year from con nuing operation ||10.62 ||69.80 |
|Profit/(Loss) from discon nuing operation ||(33.72) ||(108.41) |
|Profit/(Loss ) for the year ||(23.10) ||(38.61) |
During the year under review the total revenue of the company was Rs.9601.50 lacs ascompared to Rs. 9443.14 lacs in the previous year. The operating surplus (profit beforefinance cost and deprecia on) of the Company was Rs.1405.16 lacs as compared to Rs.1597.13 lacs in the previous year. The Company has incurred loss of Rs. 33.72 lacs for itsdiscon nuing operation as against Rs. 108.41 lacs in the previous year. The net lossduring the year was Rs. 23.10 lacs as compared to loss of Rs. 38.61 lacs in the previousyear.
Due to loss your Directors are unable to recommend payment of any dividend on EquityShares for the year under review.
The Companys export turnover was Rs. 2069.53 lacs during the year under reviewas compared to Rs. 2093.41 lacs in the previous year.
The Company has not accepted any public deposit since its incep on.
As you are aware the Rehabilita on Scheme of the Company under the provisions of theSick Industrial Companies (Special Provisions) Act 1985 was sanc oned by HonbleBoard of Industrial & Financial Reconstruc on vide its order dated June 10 2010. TheScheme envisaged comprehensive financial restructuring of the company which is s ll underimplementa on. The Company has also filed a modified Debt
Rehabilita on Scheme (MDRS) in consulta on with the secured lenders of the Companywhich is pending for approval.
TRANSFER TO INVESTORS EDUCATION AND PROTECTION FUND
In terms of sec ons 205A and 205C of the Companies Act 1956 read with General CircularNo. 22/2002 dated 23rd September 2002 issued by the Department of Company A airs theCompany could not deposit unclaimed and unpaid redemp on amount of debentures and accruedinterest thereon to Investors Educa on and Protec on Fund and had filed necessaryapplica on with the BIFR seeking relief u/s 22(3) of SICA and also their approval to makethe payment to public debenture holders as and when debentures cer ficates are surrenderedto the Company. The BIFR has approved the same in terms of the Rehabilita on Scheme sanconed by them vide order dated 10th June 2010. The Company is making payment to thedebenture holders under public category as and when the debenture cer ficates aresurrendered with the company.
CORPORATE GOVERNANCE REPORT
The Corporate Governance Report and a cer ficate from the Statutory Auditors M/s. S. S.Kothari & Co. Chartered Accountants regarding compliance of the condi ons ofcorporate governance as s pulated in Regula on 34(3) read with Schedule V of the SEBI (Lis ng Obliga ons and Disclosure Requirements ) 2015 is given in Annexure I forming partof this report.
DISCLOSURE OF PARTICULARS WITH REGARD TO CONSERVATION OF ENERGY ETC.
Necessary informa on pursuant to sub-sec on (3) of sec on 134 of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is presented in Annexure-II to this Report.
As per provisions of Sec on 152 of the Companies Act 2013 Mr. Sunil Khaitan (DIN00385961) re res by rota on and being eligible o ers himself for reappointment. The resoluon has been included in the Agenda of the ensuing Annual General Meeting. Approval of themembers is sought for the said appointment.
DECLARATION FROM INDEPENDENT DIRECTORS
The Independent Directors have submi ed the declara on of independence as requiredunder Sec on 149 of the Companies Act 2013 read with the Schedules and rules issuedthereunder as well as SEBI (Lis ng Obliga ons and Disclosure Requirements) Regula ons2015.
The auditors M/s. S. S. Kothari & Co. Chartered Accountants (Registra onNo.302034E) Statutory Auditors of the company were reappointed as Auditors in the AnnualGeneral Meeting held on 29th September 2014 for the period un l the conclusion of the21st Annual General Meeting of the Company at a remunera on to be fixed by the Board fromme to me. Further the said Auditors are eligible under Sec on 141(3) of the CompaniesAct 2013 and their appointment is to be ra fied by the members in the ensuing AnnualGeneral Meeting which we recommend. They have also confirmed that they hold a valid peerreview cer ficate as prescribed under Regula on 33(d) of the SEBI Lis ng Regula ons 2015.
The comments made by the Auditors in their report and other relevant points in Annexureto their report are self-explanatory. The relevant notes to the accounts also clarify thepoints referred to by the Auditors. The Auditors have drawn a en on of the members inqualified opinion of their report and point wise clarifica on of your Directors on suchqualified opinion is as under :
1. Point no. (a) regarding non-provision of long term and short term loans andadvances which has not been provided because your Company is hopeful of some recovery outof it and if necessary in consulta on with the Auditors necessary provision will be madein coming years.
2. Point no. (b) regarding the claims receivable from octroi department in respect ofthe closed Nasik unit your Company is hopeful of either receiving the claims or will beadjus ng the claims with the dues of Octroi dept. if any payable at the me of sale ofthe closed Nasik unit.
3. Point no. (c) is related party Transactions and has not been written o .
4. Regarding Point no. (d) your company is nego a ng with Industrial Development Bankof India for se lement of their dues which is under process.
5. Regarding Point no. (e) your Company has not made the provision of con ngentLiabilies since quantum of liability can not be ascertained pending se lement/disposal ofappeals and the Company is hopeful of ge ng favourable orders from the appellate authories in respect of such appeal. During the year under review your company has already gotfavourable order in sales tax and excise cases e ect of which has been given in the bookof Accounts and con ngent Liabilies has reduced substan ally with those favourable orders.
6. Your company has sold its land of closed Nasik unit part land of Paper Machine WireUnit at Nasik and o ce premises in Mumbai in terms of BIFR order however adjustment ofsale of these proper es could not be made during the year since sale considera on are s lllying with State Bank of India in No-Lien account pending approval of BIFR.
The Audit Committee in its Meeting held on 21st May2016 has recommended thereappointment of M/s. Mitra Bose & Associates the Cost Auditor to conduct the costaudit of the company for the financial year 2016-17 in terms of sec on 148(3) of theCompanies Act 2013. Accordingly the Board appointed the said firm of Cost Accountants tocarry out the cost audit for the year 2016-17 on the remunera on as recommended by theBoard to be fixed by members in the ensuing Annual General Meeting of the Company.
The Auditors Report are self-explanatory and therefore do not call for anyfurther explana ons/comments.
The Company has engaged M/s. Chaturvedi & Co. Chartered Accountants as itsInternal Auditor and their scope of work and the plan for audit has been approved by theAudit Committee. The report submi ed by them is regularly reviewed and their findings arediscussed with the senior management and suitable correc ve ac on taken on an ongoingbasis to improve e ciency in operations.
Pursuant to the provisions of Sec on 204 of the Companies Act 2013 and Companies(Appointment and Remunera on of Managerial Personnel) Rules 2014 the company hasappointed M/s. MR & Associates Prac cing Company Secretaries to undertake theSecretarial Audit of the company for the financial year 2015-16. The report of theSecretarial Audit is annexed herewith as Annexure - III.
SECRETARIAL AUDITORS REPORT
The Secretarial Auditor have drawn a en on of the members in qualified opinion of theirreport and your directors clarify that corporate governance report submi ed by the Companyto Bombay Stock Exchange for quarter ended 31st March 2015 was delivered on 23rd April2015 as against s pulated date of 21st April2015 and also delay in submission ofshareholding pa ern by one day due to delay in delivery by courier.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Companies Act 2013 s pulates expenditure of 2% of the average profit of past 3years of CSR activities. The Act requires the Board to cons tute a Corporate SocialResponsibility Committee of the Board which has already been cons tuted. The company hasformulated CSR Policy for promo on of educa on healthcare and other activities which isuploaded on website of the company. The net profit of the Company during last
3 financial years is below the s pulated limit i.e. Rs. 5 crores and hence the relevantprovision of the Act is not applicable on the Company.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS
The Company has an Internal Control System based on values of integrity andoperational excellence. Pursuant to the provisions of sec on 134(5)(e) of the Act theCompany has in consulta on with a reputed consultancy firm strengthened the exis ngfinancial controls of the Company. Such internal financial controls were found to beadequate for a size of the company.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
Pursuant to Sec on 134 of the Companies Act 2013 there has been no material changesand commitments a ec ng the financial posi on of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loan Guarantees and investments covered under the provisions of Sec on 186of the Companies Act 2013 is given in the Financial Statement forming part of the AnnualReport.
ENVIRONMENT SAFETY AND DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMAN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company is conscious of clean environment and safe operations. It ensures safety ofall concerned compliance with environmental regula ons and preserva on of naturalresources. As required by the Sexual Harassment of Women at Workplace (Preven on Prohibion & Redressal) Act 2013 the Company has an internal policy on preven on of sexualharassment at workplace with a mechanism of lodging complaints. During the year underreview no complaints were reported to the Board.
Adequate insurance cover has been taken for proper es of the Company includingbuildings plant and machineries and stocks against fire earthquake and other risks asconsidered necessary.
EXTRACT OF ANNUAL RETURN
The details for the financial year ended 31st March 2016 forming part of the extractof the annual return is enclosed as Annexure - IV.
CHANGE IN SHARE CAPITAL
During the year ended 31st March 2016 there is no change in the issued and subscribedcapital of your company. The outstanding equity share capital of the company as on 31stMarch 2016 is Rs. 752.10 lacs comprising of 37605123 equity shares of Rs. 2/- each.
NUMBER OF BOARD MEETINGS
The Board of Directors met five mes during the year ended 31st March 2016. The detailsof the Board Meetings and the a endance of Directors are provided in the CorporateGovernance Report.
COMPOSITION OF COMMITTEE OF DIRECTORS
The Board has cons tuted the following Committees of Directors: (a) Audit Committee(b) Nomina on & Remunera on Committee. (c) Stakeholder Rela onship Committee Thedetailed composi on of above Committees is given in Corporate Governance Report.
RELATED PARTY TRANSACTIONS
All the related party Transactions are entered on arms length basis and are incompliance with the Companies Act 2013 and the Lis ng Regula ons. There are no materiallysignificant related party Transactions made by the Company with Promoters Directors orKey Managerial Personnel etc which may have poten al conflict with the interest of theCompany at large. All related party Transactions are presented to the Audit Committee andthe Board for its approval. The related party Transactions policy as approved by the Boardis uploaded on Companys website "www.shalimarwires.com". Disclosure asrequired under Accounting Standard- 18 and in terms of point A(2) to Schedule V of theSEBI Lis ng Regula ons 2015 have been made in note no. 35 to the financial statements forthe year ended 31st March 2016.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
In terms of Regula on 25(7) of the SEBI Lis ng Regula ons 2015 your Company isrequired to conduct Familiarisa on Programme for Independent Directors (IDs) tofamiliarise them about our Company including nature of industry in which your Companyroles rights and responsibili es of IDs and any other relevant informa on. Furtherpursuant to Regula on 46 of the SEBI Lis ng Regula ons 2015 your Company is required todisseminate on its website details of familiarisa on programme imparted to IndependentDirectors during the year. During the year under review five familiarisa on programmeswere conducted during the Board Meeting of the Company. Further the Board has openchannels of communica on with the Executives which allows free flow of communica on amongDirectors in terms of raising query seeking clarifica ons and other related informa on.
KEY MANAGERIAL PERSONNEL (KMPs)
There was no change in key managerial personnel during the year under review.
ANNUAL EVALUATION OF BOARD AND ITS COMMITTEES PERFORMANCE
In compliance with the provisions of the Companies Act 2013 and SEBI (Lis ng Obligaons and Disclosure Requirements) Regula on 2015 the performance evalua on of the Boardwas carried out during the Financial Year 2015-16.
PARTICULARS OF EMPLOYEES
The prescribed par culars of employees required under Rule 5(1) of the Companies(Appointment and Remunera on of Managerial Personnel) Rules 2014 is a ached as Annexure -V to this report.
ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has established a vigil mechanism/whistle blower policy. The policy allowsin ma on by a ected persons in good faith of concern or misconduct through a writtencommunica on. The Audit Committee oversees the vigil mechanism for disposal of thecomplaint. Direct access to the Chairman of the Audit Committee is also allowed in exceponal cases. The vigil mechanism/whistle blower policy is available on the Companyswebsite (www.shalimarwires.com)
The Company has laid down the procedures to inform to the Board about the riskassessment and minimiza on procedures which shall be responsible for framing implemen ngand monitoring the risk management plan of the company.
SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There have been no significant and material orders passed by the regulators or courtsor tribunals impac ng the going concern status of the Company and its operations infuture.
DIRECTORS RESPONSIBILITY STATEMENT
The Audited Accounts for the year under review are in conformity with the requirementsof the Act and the Accounting Standards. The financial statements reflect fairly the formand substance of Transactions carried out during the year under review and reasonablypresents your Companys financial condi on and results of operations.
In terms of provisions of Sec on 134(5) of the Companies Act 2013 your Board ofDirectors to the best of their knowledge and ability confirm that:
i) In the prepara on of the annual accounts the applicable Accounting standards hadbeen followed alongwith proper explana on relating to material departures if any.
ii) The Directors have selected such Accounting policies and applied them consistentlyand made judgments and es mates that are reasonable and prudent so as to give a true andfair view of the state of a airs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
iii) The Directors have taken proper and su cient care for the maintenance of adequateAccounting records in accordance with provisions of this Act for safeguarding the assetsof the Company and for preven ng and detec ng fraud and other irregulari es;
iv) The Directors have prepared the annual accounts on a going concern basis;
v) The Directors have laid down adequate internal financial controls to be followed bythe Company and that such internal financial controls are adequate and are operating e ecvely; and
vi) There is a proper system to ensure compliance with the provisions of all applicablelaws and that such systems are adequate and operating e ec vely.
The Company con nued to have cordial rela ons with the employees at its plants locatedat U arpara and Paper Machine Wire unit at Nasik Registered O ce and Branch O ces and theBoard records its apprecia on for the useful contribu on made by them.
Your Directors place on record their deep apprecia on for the support and cooperationextended by the lenders i.e. Financial Ins tu ons and Banks customers suppliersemployees investors and Government Authori es during the year.
| ||By Order of the Board |
| ||Shalimar Wires Industries Limited |
|Registered Office: || |
|25 Ganesh Chandra Avenue ||Sunil Khaitan |
|Kolkata 700 013 ||Chairman & Managing Director |
|Date: 12th August 2016 ||DIN-00385961 |
ANNEXURE - II
Informa on under Sec on 134(3)(m) of the Companies Act 2013 read with rule 8 of theCompanies (Accounts) Rules 2014 :
A. Conserva on of Energy
|(i) The steps taken or impact on Conserva on of Energy ||1. Earlier we have installed APFC panel to increase Power factor. Due to installa on of addi onal looms in HP sidewe propose to add more number of APFC panel to compensate from HP side transformer. |
| ||2. We have proposed to introduce Energy monitoring with real me so ware system which is in process. |
|(ii) The steps taken by the Company for utilizing alternate sources of energy ||Nil |
|(iii) The capital investment on energy conserva on equipments ||Nil |
|B. Technology Absorp on || |
|(i) The e orts made towards technology absorp on ||i) WISS Long Float & 16SH. SSB are some new designs developed and sent to market for be er life of fabric as well as for be er quality of paper. |
| ||ii) 3 looms have been installed so far to increase the produc vity. |
| ||iii) Woven Dryer Screen is being developed for high speed paper machines. |
| ||iv) 2 Nos. of new spiral machines installed in our Link Canvas Dept. to increase produc vity. |
| ||v) Jumbo SLC developed for more life. |
|(ii) The benefits derived like product improvement cost reduc on product development or import subs tu on ||i) With the development of above designs we have been able to increase product life of highly abrasive machines and increase the scope of supply to di erent kind of paper machines which ul mately leads to increase in business. |
| ||ii) A er introducing 3 more looms in synthe c weaving the produc vity & quality of fabric produced will improve simultaneously. |
| ||iii) We have started manufacturing di erent grades of woven dryer fabrics thereby we are catering into this segment of market which has got growing demand considering the fact of technological up-grada on of paper making process. It has been added in our produce range to cater the segment thereby increasing the business and turn-over of the company. |
| ||iv) A er introducing two numbers of new spiral machines we are able to increase our produc vity with increased product range. |
|(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- ||Nil |
|a) the details of technology imported || |
|b) the year of import || |
|c) whether the technology been fully absorbed || |
|d) if not fully absorbed areas where absorp on has not taken place and the reasons thereof and || |
|(iv) the expenditure incurred on research and development ||Rs 6.18 lacs |
C. Foreign exchange earnings and outgo :
(i) Foreign exchange earned in terms if actual inflow : Rs 2069.53 lacs
(ii) Foreign exchange outgo in terms of actual ou low : Rs 2853.54 lacs
ANNEXURE - III
MR & Associates Company Secretaries 46 B. B. Ganguly Street Kolkata-700012 MoblieNo: 9831074332 Email : email@example.com
(TO THE SECRETARIAL AUDIT REPORT OF SHALIMAR WIRES INDUSTRIES LIMITED FOR THE FINANCIALYEAR ENDED 31ST MARCH 2016)
To The Members
SHALIMAR WIRES INDUSTRIES LIMITED
25 Ganesh Chandra Avenue P S Bowbazar Kolkata- 700013
Our report of even date is to be read along with this le er.
1. Maintenance of Secretarial Records is the responsibility of the Management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.
2. We have followed the Audit prac ces and processes as where appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial records. Theverifica on was done on test basis to ensure that correct facts are reflected inSecretarial Records. We believe that the processes and prac ces we followed provide areasonable basis for our opinion.
3. We have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.
4. Wherever required we have obtained the Management Representa on about thecompliance of laws rules and regula ons and happening of events etc.
5. The compliance of the provisions of corporate and other applicable laws rulesregula ons and standards is the responsibili es of the management. Our examina on waslimited to the verifica on of procedures on test basis.
6. The Secretarial Audit Report is neither an assurance as to the future viability ofthe Company nor of the e ciency or e ec veness with which the management has conducted thea airs of the Company.
| ||For MR & Associates |
| ||Company Secretaries |
| ||[M R Goenka] |
| ||Partner |
|Place : Kolkata ||FCS No.:4515 |
|Date : 12.08.2016 ||C P No.:2551 |
ANNEXURE - V
STATEMENT OF DISCLOSURE OF REMUNERATION PURSUANT TO SECTION 197 OF THE COMPANIES ACT2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014
|(i) The ra o of the remunera on of Chairman & Managing Director to the median remunera on of the employees of the Company for the financial year : || |
|Directors ||Ra o |
|Mr. Sunil Khaitan Chairman & Managing Director ||1:50 |
|(ii) The percentage increase in remunera on of Chairman & Managing Director Chief Financial O cer and Company Secretary in the financial year : ||% increase |
| ||(decrease) |
|Mr. Sunil Khaitan Chairman & Managing Director ||NIL |
|Mr. S.J. Sengupta CFO ||7.68% |
|Mr. S.K. Kejriwal Company Secretary ||7.97% |
|(iii) The percentage increase in the median remunera on of employees in the financial year : ||11.15% |
|(iv) The number of permanent employees on the rolls of company : (as on 31st March 2016) ||569 |
|(v) The explana on on the rela onship between average increase in remunera on and company performance : || |
|The Companys operating profits was lower by 13.6%. In the wake of di cult market condi ons the average increase in remunera on of all employees a er giving e ect of changes in dearness allowance and annual increment considering infla on and performance of respec ve employees was around 11.15 %. || |
|(vi) Comparison of the remunera on of the Key Managerial Personnel against the performance of the Company ||(Rs. in lacs) |
|Aggregate remunera on of all key managerial personnel (KMPs) in FY 2015-16 ||79.01 |
|Profit before Tax (PBT) in FY 2015-16 ||10.62 |
|Remunera on of KMPs (as % of overall performance of the Company) ||NA |
(vii) Varia ons in the market capitaliza on of the company price earnings ra o asat the closing date of the current financial year and previous financial year andpercentage increase over or decrease in the market quota ons of the shares of the companyin comparison to the rate at which the company came out with the last public o er :
| ||As at 31st March 2016 ||As at 31st March 2015 ||Varia on ||%Varia on |
|Market Capitaliza on ||Rs. in lacs ||Rs. in lacs ||Rs. in lacs ||4.95% |
| ||1357.55 ||1293.61 ||63.94 || |
|Price Earnings ||N.A. ||N.A. ||N.A. ||N.A. |
| ||As at 31st March 2016 ||Last IPO ||Bonus Issue adjustment ||%Varia on |
|Market Price (In Rs.) ||3.61 ||NIL ||NIL ||4.95% |
(viii) Average percen le increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percen leincrease in the managerial remunera on and jus fica on thereof and point out if there areany excep onal circumstances for increase in the managerial remunera on: Average percen leincrease Is 11.15% in respect of all the employees except managerial personnel and thereare no excep onal circumstances for increase in managerial remunera on.
(ix) Comparison of each remunera on of the Key Managerial Personnel against theperformance of the Company
| ||Remunera on (Rs. in lacs) ||Profit before Tax (PBT) (Rs. in lacs) ||% of PBT |
|Mr. Sunil Khaitan ||41.71 ||10.62 ||- |
|Chairman and Managing Director || || || |
|Mr. S.J. Sengupta CFO ||22.14 || ||- |
|Mr. S.K. Kejriwal Company Secretary ||15.16 || ||- |
(x) The key parameters for any variable component of remunera on availed by thedirectors
Variable component of remunera on availed by the directors. NIL
(xi) The ratio of the remunera on of the highest paid director to that of theemployees who are not directors but receive remunera on in excess of the highest paiddirector during the year :
No employee received remunera on in excess of the highest paid director being theChairman and Managing Director of the Company
(xii) A rma on that the remunera on is as per the remunera on policy of the Company
The Company a rms that the remunera on paid to employees is in accordance with theRemunera on Policy of the Company