The Members of
SHREE RAMA NEWSPRINT LIMITED
Your Directors are pleased to present the 26th Annual Report together withthe Audited Accounts for the Financial Year ended 31st March 2017.
|FINANCIAL RESULTS || |
Amount-Rs in lacs
|Particulars ||Year Ended 31-03-2017 ||Year Ended 31-03-2016 |
|Revenue from operations ||39198.52 ||38286.10 |
|Profit/(Loss) before Interest ||3205.98 ||4793.25 |
|Depreciation and Tax || || |
|Finance Cost ||2420.88 ||3143.73 |
|Profit/(Loss) before ||785.10 ||1649.52 |
|Depreciation and Tax || || |
|Depreciation ||2266.22 ||2223.10 |
|Profit /(Loss) before Tax and exceptional items ||(1481.12) ||(573.58) |
|Deferred tax assets/liabilities ||(590.73) ||404.27 |
|Exceptional Items (gain) || ||1460.00 |
|Other comprehensive income ||(3.98) ||(4.19) |
|Net Profit/Lossafter other comprehensive income ||( 894.37 ) ||477.96 |
The Company has achieved production of 118071 MT (89% capacity utilization) duringthe F.Y. 2016-17 as against 117498 MT (89% capacity utilization) achieved in FY 2015-16i.e. higher by 573 MT (0.4%). The Company has achieved sale of 115707 MT during FY2016-17 as against 119377 MT in 2015-16. During the year under review the Company hasproduced only Newsprint as being the case in the previous year.
The Company has achieved turnover of Rs 391.99 crores [with excise duty] in FY2016-17 as against Rs 382.86 crores [with excise duty] in FY 2015-16.
The working results of the Company were satisfactory as cash profit before depreciationand tax was Rs 7.85 crores in FY 2016-17 as against Rs 16.50crores in FY2015-16(considering discounted gain on ZCD and deposits of Rs54.78 crores ontransition to IND-AS otherwise it was cash loss of Rs 38.28 crores) due to higherproduction productivity unit realization lower finance charges and reduction in cost.The Net loss was of Rs 8.94 crores in FY 2016-17 as against Net profit of Rs4.78crores in FY 2015-16.
Export in Foreign exchange of Newsprint was 2264MT worth Rs 7.70 crores (FOB) inF.Y. 2016-17 as against 1580 MT worth Rs 5.31 crores (FOB) in F.Y 2015-16 whereasdirect and indirect export was of 3119 MT worth Rs10.64 crores in F.Y. 2016-17asagainst 2480 MT worth Rs 8.22 crores in F.Y 2015-16.
Your Directors have not recommended any dividend in view of the losses su3ered by theCompany.
TRANSFER TO RESERVES:
In view of losses su3ered the Company has not proposed to transfer any amount toGeneral Reserves or any other reserve.
THE CHANGE IN NATURE OF BUSINESS:
There are no material changes and commitments that would affect financial position ofthe Company from the end of the financial year of the Company to which the financialstatements relate and the date of the directors report.
The Company has issued shares to ICICI Bank Ltd. in 2 tranches 3rst on 09.01.2017where by 29172900 optionally convertible debentures (OCD) of Rs10/- each wereconverted into 29172900 shares of Rs10/- each and in second tranche on30.01.2017 whereby 191100 OCDs of Rs 10/- each were converted into shares of191100 shares of Rs10/- each. The equity share capital has therefore gone up from118158032 shares of Rs10 each to 147522032 shares of Rs10 each. Thebalance OCD of 636000 out of total issued OCD of 30000000 were paid on 31.01.2017.Thus there is no outstanding OCD.
As per the decision of the Joint Lender Forum (J.L.F.) as confirmed by the Bankers/lenders in the meeting held on 31-03-2015 I.C.I.CI Bank Ltd. Bank of India and OrientalBank of Commerce & Central Bank of India had implemented the same and issued sanctionletters for re-structured loans in F.Y 2015-16.
Axis Bank Ltd. has also done one time settlement (OTS) with the Company as per theirsanction letter dated 04.01.2017 for Rs 6.00 crores as against total dues of Rs12.76crores. The Company has paid the entire amount by 25.06.2017.
The Company has repaid loan of Rs 4.28 crores by ICICI Bank Ltd. during the yearand also short term loan of Rs 30 crores was paid to Kotak Mahindra Bank Ltd. bytaking Inter Corporate Deposit from Riddhi Siddhi Gluco Biols Ltd.
ISSUE OF SHARES ON CONVERSION OF OPTIONALLY CONVERTIBLE DEBENTURES (OCD):
During the Year Company has allotted 29172900 equity shares on 9thJanuary 2017 and 191100 equity shares on 30th January 2017 in pursuance toconversion of Optionally Convertible Debentures (OCDs) to ICICI Bank Limited.
The Company has not accepted or renewed any deposit during the year and there is nooutstanding on this account in books of the Company.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any joint venture subsidiary or associate company within themeaning of Section 2(6) of the Companies Act 2013.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure I".
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013. However details of investment made by the Companyis mentioned in the financial statement of the Company.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
Company has not entered into any related party transactions as enumerated in Section188 of the Companies Act 2013 during the year. Accordingly Company is not required todisclose the said information in Form AOC-2.
NUMBER OF MEETINGS OF THE BOARD
During the year four Board Meetings were convened and held and details thereof arementioned in the Report on Corporate Governance forming part of this Annual Report.Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:
The Board of Directors appointed additional Director Mrs. Kavita Tapan Patel(DIN:07671628) on 10th December 2016 subject to approval of members in theensuing Annual General Meeting.. Mr. V. D. Bajaj resigned as Executive Director on16.06.2016 and Mrs. Pallavi Mittal resigned from the Board of the Company on 26.09.2016.The Company expresses sincere gratitude to them for the contribution made during theirtenure as Directors of the Company.
The Company has also appointed Mr. Siddharth G. Chowdhary as an Executive Director ofthe Company for a period of 3 years with effect from 10.12.2016.
Shri Ganpatraj L. Chowdhary retires from the office by rotation but beingeligible offers himself for re-appointment.
The brief resume of the Director proposed to be reappointed nature of their expertisein specific functional areas names of Companiesin which they holds Directorships andMemberships of Board Committees shareholding are provided in the Notice to Membersas perregulation 36 (3) THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS ANDDISCLOSURE REQUIREMENTS) REGULATIONS 2015 forms a part of this Annual Report
DIRECTORS' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 134(3)(c) OF THE COMPANIES ACT2013:
The Directors hereby confirm that:-
1. in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
2. 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;
3. 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;
4. the directors had prepared the annual accounts on a going concern basis;
5. the directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively; and
6. the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
Pursuant to Section 149(6) of the Companies Act 2013 Independent Directors of theCompany have made a declaration confirming the compliance of the conditions of theindependence stipulated in the aforesaid section.
DETAILS OF COMMITTEE OF DIRECTORS:
The Composition of Audit Committee of Directors Nomination and Remuneration Committeeof Directors and Stake Holders Relationship/ Grievances Committee of Directors number ofmeetings held of each Committee during the financial year 2016-17 and meetings attended byeach member of the Committee as required under the Companies Act 2013 are provided inCorporate Governance Report.
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE ITS COMMITTEES AND INDIVIDUALDIRECTORS:
The Company has devised a Policy for performance evaluation of the Board Committeesand other individual Directors (including Independent Directors) which includes criteriafor performance evaluation of the Non-executive Directors and Executive Directors. Theevaluation process inter alia considers attendance of Directors at Board and committeemeetings acquaintance with business communicating inter-se board members effectiveparticipation domain knowledge compliance with code of conduct vision and strategybenchmarks established by global peers etc which is in compliance with applicable lawsregulations and guidelines.
The Board carried out annual performance evaluation of the Board Board Committees andIndividual Directors and Chairman. The Chairman of the respective Board Committees sharedthe report on evaluation with the respective Committee members. The performance of eachCommittee was evaluated by the Board based on report on evaluation received fromrespective Board Committees.
The reports on performance evaluation of the Individual Directors were reviewed by theChairman of the Board.
In compliance with the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosures Requirements) Regulations 2015 the performance evaluationwas carried out as under Board:
In accordance with the criteria suggested by The Nomination and Remuneration Committeethe Board of Directors evaluated the performance of the Board having regard to variouscriteria such as Board composition Board processes Board dynamics etc. The IndependentDirectors at their separate meetings also evaluated the performance of the Board as awhole based on various criteria specified by Companies Act 2013. The Board and theIndependent Directors were of the unanimous view that performance of the Board ofDirectors as a whole was satisfactory.
Committees of the Board:
The performance of the Audit Committee the Nomination and Remuneration Committee andthe Stakeholders Relationship Committee was evaluated by the Board having regard tovarious criteria such as committee composition committee processes committee dynamicsetc. The Board was of the unanimous view that all the committees were performing theirfunctions satisfactorily and according to the mandate prescribed by the Board under theregulatory requirements including the provisions of the Act the Rules framed there underand the SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015.
In accordance with the criteria suggested by The Nomination and Remuneration Committeethe performance of each independent director was evaluated by the entire Board ofDirectors (excluding the director being evaluated) on various parameters like engagementleadership analysis decision making communication governance and interest ofstakeholders. The Board was of the unanimous view that each independent director was areputed professional and brought his/her rich experience to the deliberations of theBoard. The Board also appreciated the contribution made by all the independent directorsin guiding the management in achieving higher growth and concluded that continuance ofeach independent director on the Board will be in the interest of the Company.
The performance of each of the non-independent directors (including the chair person)was evaluated by the Independent Directors at their separate meeting. Further theirperformance was also evaluated by the Board of Directors. The various criteria consideredfor the purpose of evaluation included leadership engagement transparency analysisdecision making functional knowledge governance and interest of stakeholders. TheIndependent Directors and the Board were of the unanimous view that each of thenon-independent directors was providing good business and people leadership.
INTERNAL CONTROL SYSTEMS:
The Company has an adequate system of internal control procedures which is commensuratewith the size and nature of business. Detailed procedural manuals are in place to ensurethat all the assets are safeguarded protected against loss and all transactions areauthorised recorded and reported correctly. The internal control systems of the Companyare monitored and evaluated by internal auditors and their audit reports are periodicallyreviewed by the Audit Committee of the Board of Directors.
APPOINTMENT AND REMUNERATION POLICY:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration which is available on Company's website at www. ramanewsprint.com
WHISTLE BLOWER POLICY:
The Company has formulated a Whistle Blower Policy to establish a vigil mechanism forDirectors Employees and other Stakeholders of the Company to report concerns aboutillegal and unethical practices unethical behavior actual or suspected fraud orviolation of the Company's Code of Conduct or Ethics Policy which is available at theCompany's website at www. ramanewsprint.com
ADOPTION OF POLICES AS PER THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTINGOBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS 2015 The board framed policies onPreservation of Documents and Determining Materiality for Disclosure to Stock Exchangeswhich are available at the Company's website at www. ramanewsprint.com
During the year the Management of the Company had evaluated the existing RiskManagement Policy of the Company. The Risk Management policy has been reviewed and foundadequate and sufficient to the requirement of the Company. The Management has evaluatedvarious risks and that there is no element of risk identified that may threaten theexistence of the Company.
LISTING OF SHARES
Equity Shares of Company continue to be listed on BSE Ltd. (BSE) and National StockExchange of India Ltd. (NSE). The Company has duly paid listing fees to the stockexchanges.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
Particulars with respect to Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo as required u/s 134(3)(m) of the Companies Act 2013 read withCompanies (Accounts) Rules 2014 are furnished as Annexure III to this Report andforms part of it.
CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS .
Report on Corporate Governance and Management Discussion and Analysis is made part ofthis Annual Report.
As required by the Listing Agreements the Certificate of Auditors on CorporateGovernance compliance is also annexed to this Annual Report.
The Certificate from Chief Executive Officer and Chief Financial Officer was placedbefore the Board of Directors at its meeting held on 14.08.2017.
PARTICULARS OF EMPLOYEES
The information as per section 197(12) of the Companies Act 2013 read with Rule 5(2)of the Companies (Appointment and remuneration of managerial personnel) Rules 2014 are asper Annexure-III.
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and remuneration of Managerial Personnel) Rules 2014 theBoard on the recommendations of the Audit Committee has appointed M/s. Ravi Kapoor &Associates a sole proprietor of Company Secretaries in Practice to undertake theSecretarial Audit of the Company for the financial year ended 31st March 2017.Secretarial Audit Report issued by M/s. Ravi Kapoor & Associates a sole proprietorCompany Secretaries in form MR-3 forms part of this report and marked as Annexure-IV.
The audit of cost accounts of the Company is being carried out by M/s Nanty Shah andAssociates for FY 2016-17 and after completion of the audit they will submit their reportto the Central Government.
CASH FLOW STATEMENT
As required under clause 34 of the THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTINGOBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS 2015 the Cash Flow Statement isattached to the Annual report.
As per the provisions of the Act the period of office of Haribhakti & Co. LLPChartered Accountants of the Company expires at the conclusion of the ensuing AnnualGeneral Meeting.
It is proposed to appoint Batliboi & Purohit Chartered Accountants as auditor ofthe Company for a term of 5 (3ve) consecutive years. Batliboi & Purohit CharteredAccountants have confirmed their eligibility and qualification required under the Act forholding office as Statutory Auditors of the Company.
EXPLANATIONS OR COMMENTS BY BOARD ON EVERY QUALIFICATION RESERVATION OR ADVERSE REMARKOR DISCLAIMER MADE: (i) by the auditor in his report;
There is no qualification reservation or adverse remark or disclaimer in audit reportissued by the auditors of the Company.
(ii) By the company secretary in practice in his secretarial audit report;
There is no qualification reservation or adverse remark or disclaimer in secretarialaudit report issued by the company secretary in practice.
CORPORATE SOCIAL RESPONSIBILITY
The Company is not required to form Corporate Social Responsibility committee or policyas per section 135 (1) of the companies act 2013 since the same is not applicable to it asper criterion laid down therein. However the Company is meeting its social obligations forlocal persons by providing health check up facilities including distribution of freemedicines. It also supplies free drinking water to nearby villages. The Company is alsorunning a modern English medium school for imparting quality education to local personsand undertakes various community welfare jobs from time to time.
The Company is also maintaining colony for workers & sta3 which has all the modernamenities.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
In terms of Section 134(3)(i) of the Companies Act 2013 it is reported that exceptas disclosed elsewhere in this report no material changes and commitments which couldaffect the Company's financial position have occurred between the end of the financialyear of the Company and date of this report.
SIGNIFICANT AND MATERIAL ORDERS
There are no material orders passed by Regulators Courts or Tribunals impacting thegoing concern status and company's operations in future.
The industrial relations remained cordial throughout the year under review.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION &REDRESSAL) ACT 2013:
The board has developed the Sexual Harassment Policy of the Company for safety of thewomen employees employed in the Company. The Sexual Harassment Policy is uploaded onwebsite of Company at www.ramanewsprint.com. Further no complaint / case has been 3led /pending with the Company during the year.
The Directors wish to place on record and acknowledge their appreciation and gratitudefor the continued co-operation and support received from the Union Government the StateGovernment of Gujarat Regulatory Bodies participating Financial Institutions and BanksCustomers Suppliers and Dealers. The Directors take this opportunity to express theirappreciation towards the dedication commitment and teamwork shown by employees which hasresulted in improved working results.Your Directors further thank Members/ Shareholdersfor their continued confidence reposed in the management of the Company.
| ||For and on behalf of the Board |
| ||(Ganpatraj L. Chowdhary) |
|Place : Ahmedabad ||CHAIRMAN |
|Date : 14.08.2017 ||DIN: 00344816 |
Information as per Section 134(3)(m) of the Companies Act 2013 read with Companies(Accounts) Rules 2014 and forming part of the Directors' Report to the members for theyear ended 31st March 2017.
A CONSERVATION OF ENERGY
i) The steps taken or impact on conservation of energy :
a) VFD installation in FD and ID Fans in CE4 Boiler b) Thermal insulation of identifiedPV Fan hot air steam and condensate lines at paper machine.
c) Replacing existing wire vacuum blower with energy effcient one at PM-2 d) Replacingvacuum Flume pump (851-31-29A) with Turbo pump.
e) Reducing system voltage of in-take well. f) Replacing V-pulley of Vacuum pump(851-79-04) at PM-1.
g) Switching off 15 MVA Siemens TG Transformer from 11 KV to 415 Volts.
h) Reducing transformer voltage from 3399 V to 3150 V at PM-2.
i) Trim Pumper (PM-1) power saving by stopping pump with pulper.
j) Replacing existing pumps with energy effcient pumps at Utility.
k) Reducing Voltage Level from 432 V to 415 V l) Converting motor delta connection tostar connection in various sections of the Plant.
m) Replacing existing motor with energy effcient / lower capacity motor.
n) Speed reduction of chest agitators..
o) Replacing conventional lights with LED lights
p) By lighting voltage optimization.
ii) The steps taken by the company for utilizing alternate sources of energy : Not any
iii) The capital investment on energy conservation equipments : Rs69.69 lacs(Last year Nil)
B TECHNOLOGY ABSORPTION
(i) The efforts made towards technology absorption :
a) Started replacing conventional light with LED lights without compromisingillumination level.
b) 1. Boiler FD and ID fan provided with Variable Frequency Drive.
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution :
a) Led Lights consume less power as compared to conventional lights. Hence it savesenergy
b) Process improvement apart from energy saving.
(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) : Not any.
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 absorption has not taken place and the reasonsthereof; and
|(iv) The expenditure incurred on Research and Development : || || |
| ||2016-17 ||2015-16 |
|Capital ||- ||- |
|Recurring ||4.53 ||6.03 |
|Total ||4.53 ||6.03 |
|Total R&D expenditure as a percentage of total turnover ||- ||- |
C FOREIGN EXCHANGE EARNING AND OUTGO
| || ||(Rs /lacs) |
| ||Current year ended 31-03-2017 ||Previous year ended 31-03-2016 |
|Foreign Exchange Earning ||770.18 ||530.54 |
|Foreign Exchange Used ||10671.61 ||10928.21 |
STATEMENT PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT 2013 AND RULES OF THECOMPANIES (APPOINTMENT AND REMUNERATIN OF MANAGERIAL PERSONNEL) RULES 2014
|(i) The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year; ||Mr. V. D. Bajaj Executive Director (till 16.6.2016) ||9.46:1 |
| ||Mr. Siddharth G. Chowdhary Executive Director (from 10.12.2016) ||8.33:1 |
|(ii) The percentage increase in remuneration of each Director Chief Financial Officer Chief Executive Officer Company Secretary or Manager if any in the financial year; ||Mr. V. D. Bajaj Executive Director (till 16.6.2016) ||NIL Rs21.05 Lacs in 2016-17 against Rs 68.71 Lacs in 2015-16. |
| ||Mr. Siddharth G. Chowdhary Executive Director (from 10.12.16) ||Rs 18.55 Lacs (previous year Nil) |
| ||Mr. P. K. Mundra President (Finance) & Company Secretary and C.F.O. ||5.88% Rs 49.95 .Lacs as against Rs 11.24 Lacs (part of year from 14.12.2015) |
|(iii) The percentage increase in the median remuneration of employees in the financial year; || ||18.39 |
|(iv) The number of permanent employees on the rolls of company; || ||388 |
|(v) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justi3cation thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration. || ||There were no increments in salary during the previous year for Executive Director being new appointment and it was 5.88% for President (Finance) & Company Secretary as against general increase of 17% for non-managerial personnel. |
|(vi) Afirmation that the remuneration is as per the remuneration policy of the Company. || ||It is hereby afirmed that remuneration paid is as per the remuneration policy of the Company. |