Your Directors have pleasure in presenting their 31st Annual Report on the business andoperations of the Company and Audited Statement of Accounts for the year ended 31st March2017.
1. FINANCIAL HIGHLIGHTS:
The Board's Report is prepared based on the stand alone financial statements of theCompany.
(Rs. in Lacs)
|Sr. No. Particulars ||2016-2017 ||2015-2016 |
|1. Net Sales/ Income ||883.84 ||915.63 |
|2. Total Expenditure || || |
|I) Cost of material consumed ||1.71 ||8.69 |
|ii) Purchase of stock ||46.48 ||71.85 |
|iii) Manufacturing and operating cost ||47.66 ||33.09 |
|iv) Changes in inventories ||(171.79) ||(20.49) |
|v) Employee benefit Expenses ||161.71 ||134.85 |
|vi) Financial cost ||80.07 ||94.02 |
|vii) Depreciation ||30.60 ||39.52 |
|viii) Other Expenditure ||277.69 ||237.09 |
|Total ||474.13 ||598.62 |
|3. Profit Before Tax ||409.71 ||317.01 |
|4. Provision for taxation || || |
|i) Current Tax ||154.66 ||111.93 |
|ii) Deferred Tax ||(1.59) ||(4.18) |
|5. Profit After Tax ||256.64 ||209.26 |
|6. Balance carried from previous year ||75.94 ||63.42 |
|7. Amount Available for Appropriation ||332.58 ||272.68 |
|8. Appropriations: || || |
|Proposed Dividend ||80.00 ||80.00 |
|Dividend Distribution Tax ||16.74 ||16.74 |
|Transferred to General Reserve ||90.00 ||100.00 |
|9. Balance carried to Balance Sheet ||145.84 ||75.94 |
We are pleased to inform that the Board of Directors has recommended dividend of Re.0.20 per equity share of Re. 1/- each (i.e. 20 % of face value) aggregating Rs. 8000000(excluding dividend distribution tax as applicable) for the year ended on 31st March2017.
During the period under review the Profit after tax (PAT) stood at 256.64 Lakhs(Previous Year Rs. 209.26 Lakhs) there was an increase of 22.64% as compared to lastfinancial year. Your Directors are con dent of even better returns in the future.
The Board of Directors have transferred Rs. 90 Lakhs to General Reserve.
5. DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors state 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 suf cient 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 provisionsof all applicable laws and that such systems were adequate and operating effectively.
6. DIRECTORS AND KEY MANAGERIAL PERSONNEL APPOINTMENTS/ RESIGNATIONS DURING THEYEAR:
The following change took place during the financial year 2016-17 under review:
|Name of the Person ||Designation ||Date of change ||Nature of Change Appointment/ Resignation |
|Mr. Piyush Shah (DIN: 02333557) ||Independent Director ||July 14 2016 ||Resignation |
7. EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Report in form MGT-9 as requiredunder Section 92(3) of the Companies Act 2013 read with rule 12(1) of the Companies(Management and Administration) Rules 2014 are included in this Report as Annexure-Iand forms an integral part of this report.
8. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The particulars of every contract or arrangements entered into by the Company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act 2013including certain arm's length transactions under third proviso thereto is disclosed inForm No. AOC-2 which is enclosed as
9. PARTICULARS OF EMPLOYEES:
The information required pursuant to Rule 5 (1) of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed as Annexure III to theDirectors Report.
Particulars of employees drawing remuneration in excess of limits prescribed underSection 134 (3)(q) read with Rule 5(2) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014:
There are no employees drawing remuneration exceeding Rupees One Crore and Two Lakhsper annum if employed throughout the financial year or rupees Eight Lakhs and FiftyThousand per month if employed for part of the financial year or draws remuneration inexcess of Managing Director or Whole time Director or Manager and holds by himself oralong with his spouse and dependent children not less than two percent of the equityshares of the Company.
10. NUMBER OF MEETINGS OF BOARD:
|Sr.No Particulars ||No. of meetings held |
|1. Board Meetings ||Five |
|2. Audit Committee Meetings ||Four |
|3. Independent Directors Meeting ||One |
11. FORMAL ANNUAL EVALUATION:
Pursuant to the provision of Section 134 (3) (p) of the Companies Act 2013 the Boardhas carried out the annual performance evaluation of its own performance the Directorsindividually as well as the evaluation of the working of its Audit Nomination andRemuneration and Stakeholders Relationship Committees. A structured questionnaire wasprepared after taking into consideration inputs received from the Directors coveringvarious aspects of the Board's functioning such as adequacy of the composition of theBoard and its Committees Board cultures execution and performance of speci c dutiesobligations and governance.
A separate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgement safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors. TheDirectors expressed their satisfaction with the evaluation process.
12. DECLARATION BY INDEPENDENT DIRECTORS:
Declarations by the Independent Directors that they meet the criteria of independenceas provided in sub-section (6) of Section 149 of the Companies Act 2013 has been receivedby the Company.
13. REMUNERATION POLICY:
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of directors Key Managerial Personnel and Senior Management of the Company.The said policy is also uploaded on the website of the Company; i.e. www.svartcorp.in
At the Annual General Meeting held on September 28 2015 M/s. Sanjay Raja Jain &Co. Chartered Accountants (FRN 120132W) Mumbai were appointed as statutory auditors ofthe Company to hold of ce till the conclusion of the Annual General Meeting to be held inthe year 2018. In terms of the rst proviso to Section 139 of the Companies Act 2013 theappointment of auditors shall be placed for rati cation at every Annual General Meeting.Accordingly the appointment of M/s. Sanjay Raja Jain & Co. Chartered Accountants asStatutory Auditors of the Company is placed for rati cation by the shareholders.
The report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no quali cation reservation adverse remark ordisclaimer given by the Auditors in their Report.
15. SECRETARIAL AUDIT REPORT:
In terms of Section 204 of the Companies Act 2013 and Rules made thereunder M/s.Sandeep Dar and Co. Practicing Company Secretaries have been appointed as SecretarialAuditor of the Company. The report of the Secretarial Auditors is enclosed as AnnexureIV to this report. The report is self-explanatory however the Company has initiatednecessary steps to comply with various non-compliances as per the provisions of variousstatute mentioned under the secretarial audit report.
16. VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
The Company has a Whistle Blower Policy to report genuine concerns or grievances. TheWhistle Blower Policy has been posted on the website of the Company www.svartcorp.in
17. COMPOSITION OF AUDIT COMMITTEE:
Composition of Audit Committee is required under section 177 (8) of the Companies Act2013.
The Composition of Audit Committee is as follows:
|1. Mr. Rakeshkumar Garodia ||- Chairman |
|2. Mr. Rajeshkumar Poddar ||- Member |
|3. Mr. Sanjiv Rungta ||- Member |
18. SIGNIFICANT MATERIAL CHANGES:
There were no material changes and commitments which adversely affects the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financial statements relate and the date of the report.
19. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS:
The Board of your Company has laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and operatingeffectively.
20. RISK MANAGEMENT
The Company is periodically reviewing its risk management perception taking intoaccount overall business environment affecting/ threatening the existence of the Company.Presently board is of the opinion that such existence of risk is minimal.
During the year under review the Company has not accepted any deposits within themeaning of Section 73 of Companies Act 2013 read with the Companies (Acceptance ofDeposits) Rules 2014 and as such no amount on account of principal or interest on publicdeposits was outstanding as on the date of the balance sheet.
22. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013:
During the year under review the Company have neither given any loans nor provided anyguarantees which are governed by the provisions of Section 186 of the Companies Act 2013.However the Company has made investments the details of which are given below:
|Sr. No. Particulars ||Face Value (Rs.) ||No. of Shares ||Amount (Rs.) |
|1. GMR Infrastructure Limited ||1 ||32500 ||422384 |
|2. Hindustan Construction Company Limited ||1 ||11500 ||276406 |
|3. Jain Irrigation Systems Limited ||2 ||4500 ||334568 |
|4. Nitesh Estates Limited ||10 ||47000 ||550377 |
|5. Tata Steel Limited ||10 ||1000 ||338457 |
23. MANAGEMENT DISCUSSION AND ANALYSIS:
I. INDUSTRY STRUCTURE AND DEVELOPMENTS
GEMSTONE CARVINGS SIGNIO PAINTINGS AND COUTURE
The initiatives taken last year in the area of corporate gifting are yielding goodresults and we are very hopeful that this will be a sustained growth portfolio for ourcompany. Our export business to the US and UK continues to do well and we have come upwith many gemstone carvings which are speci cally designed for the US market. We are condent that this growth in exports will continue for the coming years. With the Indianeconomy poised for growth we are con dent of delivering better results in the future andfeel that our loyal customers and new collectors will keep giving us continuous business.
The challenges faced by the real estate sector are primarily due to poor economicsentiment high borrowing cost and a slow income growth for industry and consumer alike.However we are able to witness the beginnings of a revival in the commercial real estatemarket. With the new government continuing their initiatives to support the corporateactivity in the country there is a general and upbeat sentiment that we could be in themidst of a revival in the commercial real estate sector. Therefore we remain optimisticof good occupancy rates for our premises.
II. OPPORTUNITIES AND THREATS
There exists a huge opportunity for Indian players to do value addition to the low costjewellery items and can export such jewellery. India has an advantage of manufacturingaffordable jewellery for the world market.
The Indian retail sector provides an excellent opportunity for the Indian players tomanufacture and sell their jewellery through the retail channels that are fast catching upin the Indian markets.
The gems and Jewellery sector in India is unorganized and fragmented. Most of theplayers who operate in the unorganized sector belongs to family-run operations. The natureof the sector prevents it from achieving economies of scale.
III. SEGMENT-WISE PERFORMANCE:
During the year under review revenue from sale of products was Rs. 12115786 AndRevenue from sale of services was Rs. 76207565.
In the coming years industry is expected to have robust demand specially in brandedretail products and with established brands guiding the organized market. The futureoutlook for organized retail is quite strong. The Company is gearing up for aggressivesales and financials in the coming year and some of the key strategies to aid in itsgrowth are as under:
Modernization of existing products. Increase in marketing strategies. Introduction ofmany new collections.
V. RISKS AND CONCERNS
Like any other business the gems and jewellery business also has its own set ofchallenges and risks emanating from internal and external sources. The Company has inplace a comprehensive risk management policy that helps to anticipate and identify riskswide nding ways to mitigate them.
Economy risk: Jewellery purchases are discretionary and may be affected by adverseeconomic trends.
Competition risk: The Company's market share may be affected by an increase in thenumber of branded jewellers.
Price volatility risk: Volatility in the market price of gold and diamonds has abearing on the value of our inventory and could affect our income Profitability and scaleof operations.
VI. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has adequate internal control system commensurate with the size of itsoperations. Adequate records and documents are maintained as required by laws. All effortsare being made to make the internal control systems more effective.
24. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF
WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:
Company has adopted a policy for prevention of Sexual Harassment of Women at workplaceas required under the Act.
The following is a summary of sexual harassment complaint received or disposed offduring the year 2016-17.
No. of Complaint received: NIL
No. of Complaint disposed off: NIL
25. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
In the view of the nature of the Company Rule 8 of Company (Accounts) Rules 2014concerning conservation of energy and technology absorption respectively are notapplicable to the Company.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
|Sr. No. Particulars ||2016-17 ||2015-16 |
| ||(Rs. In Lakhs) ||(Rs. In Lakhs) |
|1. Foreign Exchange Earned ||35.18 ||33.99 |
|2. Foreign Exchange Used ||49.49 ||42.39 |
26. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
No signi cant or material orders were passed by the regulators or courts or Tribunalswhich impact the going concern status and Company's' operations in future.
We record our gratitude to the Banks and others for their assistance and cooperationduring the year. We also wish to place on record our appreciation for the dedicatedservices of the employees of the Company. We are equally thankful to our esteemedinvestors for their co-operation extended and con dence reposed in the management.
|Registered Of ce: ||By Order of the Board |
|303 Tantia Jogani Industrial Estate ||Swasti Vinayaka Art And Heritage |
|J. R. Boricha Marg Lower Parel ||Corporation Limited |
|Mumbai 400011. ||Ramprasad Poddar |
|Date: May 30 2017 ||Chairman |
|Place: Mumbai ||DIN:00163950 |