To the Members
Your Directors have pleasure in presenting this Twenty Eighth Annual Report togetherwith the Standalone & Consolidated Audited Financial Statements of the Company for thefinancial year ended 31st March 2017.
The summarized financial results for the year ended 31st March 2017 and forthe previous year ended 31st March 2016 are as follows:
| || |
Consolidated year Ended
Standalone year Ended
| ||2017 ||2016 ||2017 ||2016 |
|Revenue from Operations ||6504.78 ||6365.52 ||3887.48 ||3801.36 |
|Other Income ||20.51 ||34.92 ||17.11 ||37.82 |
|Share in Profit of Associates for the year ||4.07 ||3.67 ||0.00 ||0.00 |
|Total Income ||6529.36 ||6404.11 ||3904.59 ||3839.18 |
|Profit before Finance Cost Depreciation & Tax ||898.87 ||843.17 ||510.41 ||510.84 |
|Finance Cost ||186.82 ||175.84 ||118.78 ||107.83 |
|Depreciation ||317.54 ||285.54 ||187.68 ||166.99 |
|Profit before Tax ||394.51 ||381.79 ||203.95 ||236.02 |
|Less: Tax Expenses ||43.76 ||64.85 ||10.40 ||34.37 |
|Profit for the year before Minority Interest ||350.75 ||316.94 ||193.55 ||201.66 |
|non Controlling Interest ||(2.29) ||(3.10) ||0.00 ||0.00 |
|Profit for the year ||348.46 ||313.84 ||193.55 ||201.66 |
|Total Other Comprehensive Income for the year ||(141.68) ||55.56 ||8.55 ||4.55 |
|Total Comprehensive Income for the Year ||206.78 ||369.40 ||202.10 ||206.21 |
During the year under review your Company has achieved consolidated total income andnet profit of Rs.6529.36 crore and Rs. 348.46 crore respectively as against total incomeand net profit of Rs. 6404.11 crore and Rs. 313.84 crore respectively during the previousfinancial year ended 31st March 2016.
Further your Company has achieved standalone total income of Rs. 3904.59 crore and netprofit of Rs. 193.55 crore as against total income of Rs. 3839.18 crore and net profit ofRs. 201.66 crore during the previous financial year ended 31 st March 2016.
The comprehensive details of performance of the Company has been given in theManagement Discussion and Analysis Report appended hereto.
The Details of financial performance of all subsidiaries and associates are containedin Note No. 48 of the Notes to Accounts to the Consolidated Financial Statements.
transfer of unclaimed dividend
An amount of Rs. 2124696 (Rupees Twenty One Lac Twenty Four Thousand Six Hundredninety Six only) was transferred to Investor Education and protection Fund (IEpF) duringthe year under review.
Your Directors are pleased to recommend a dividend @ Rs.3.50 per share for thefinancial year ended March 312017 after considering future needs of the company forgrowth.
The dividend if approved at the forthcoming Annual General Meeting will be paid toMembers whose names appear in the Register of Members as on 24th July 2017. Inrespect of shares held in dematerialized form it will be paid to those Members whosenames are furnished by national Securities Depository Limited and Central DepositoryServices (India) Limited as beneficial owner.
CHANGE IN NATURE OF BUSINESS
There is no change in the nature of business of the Company.
The paid-up equity share capital outstanding as on 31st March 2017 was Rs.72.21 Crore. During the year under review the Company has neither issued Shares withDifferential Voting Rights nor granted Stock Options nor Sweat Equity.
As on 31st March 2017 none of the Directors of the Company except thefollowing held shares or convertible instruments of the Company:
|Mr. Ashok Chaturvedi ||502533 |
|CMD ||Equity Shares |
|Mr. M.G. Gupta ||8061 |
|Director ||Equity Shares |
The company neither had any fixed deposits outstanding as at 31st March 2017nor fresh/renewal of deposits were accepted during the financial year 2016-2017. Therewere no unclaimed deposits as at March 312017.
During the year Mr. Arvind Mahajan (DIN: 02410540) has been appointed as an AdditionalDirector (Independent) on the Board of the Company w.e.f. 3nd August 2016.Your Directors welcome Mr. Mahajan on the Board of the Company.
The IFCI Limited has withdrawn the Nomination of Mr. Vijay Kumar Gupta as nominee ofIFCI Limited and nominated Mr. V. Anishbabu (02830575) as new nominee w.e.f. 16thMay 2017. The Board of Directors placed on record their appreciations for the valuablecontribution made by Mr. Vijay Kumar Gupta. your Directors welcome Mr. V. Anishbabu on theBoard of the Company.
Mr. pradeep poddar (Din: 00025199) has been appointed as an Additional Director(Independent) of the Company w.e.f. 30th May 2017. your Directors welcome Mr.poddar on the Board of the Company.
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. Amitava Ray Whole-time Director (DIn 00184143) of theCompany retire by rotation and being eligible offers himself for reappointment. The briefresume and other details as required under Securities and Exchange of Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 are provided in theNotice of Annual General Meeting of the Company.
All Independent Directors of your Company have given declarations confirming that theymeet the criteria of Independence as prescribed both under the Act and Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015.
RELATIONSHIP BETWEEN DIRECTORS INTER-SE
None of the Directors are related to each other within the meaning of the term"relative" as per Section 2(77) of the Companies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT
On the basis of compliance certificates received from the Executives of the Companysubject to disclosures in the Annual Accounts and also on the basis of the discussion withthe Statutory Auditors/ Internal Auditors of the Company from time to time your Directorsmake the following statements in terms of Section 134(3)(c) of the Companies Act 2013:
a. that in the preparation of the annual accounts for the year ended 31stMarch 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b. that the Company has 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 as at 31st March 2017 and ofthe Profit of the Company for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d. that the annual accounts have been prepared on a going concern basis;
e. that proper Internal Financial Controls were in place and that the financialcontrols were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
The Company's Internal Auditors have conducted periodic audit to provide reasonableassurance that the Company's established policies and procedures have been followed. TheAudit Committee constituted by the Board reviewed the internal controls and financialreporting issues with Internal Auditors and Statutory Auditors.
STATUTORY AUDIT & AUDITORS
As per Section 139 of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 the term of M/s. Vijay Sehgal & Co. Chartered Accountants(Firm Registration No. 000374N) Delhi as the Statutory Auditors of the Company expires atthe conclusion of the ensuing Annual General Meeting of the Company. The Board ofDirectors of the Company at their meeting held on 30th May 2017 on therecommendation of the Audit Committee have made its recommendation for appointment ofM/s. KAAP & Associates Chartered Accountants (Firm Registration No. 019416N) as theStatutory Auditors of the Company by the Members at the 28th Annual GeneralMeeting of the Company for an initial term of 5 years. Accordingly a resolutionproposing appointment of M/s. KAAP & Associates Chartered Accountants (FirmRegistration No. 019416N) as the Statutory Auditors of the Company for a term of fiveconsecutive years i.e. from the conclusion
of 28th Annual General Meeting till the conclusion of 33rd Annual GeneralMeeting of the Company pursuant to Section 139 of the Companies Act 2013 forms part ofthe Notice of the 28th Annual General Meeting of the Company. The Company hasreceived their written consent and a certificate that they satisfy the criteria providedunder Section 141 of the Act and that the appointment if made shall be in accordancewith the applicable provisions of the Act and rules framed thereunder. The Report given byM/s. Vijay Sehgal & Co. Chartered Accountants (Firm Registration No. 000374N)Statutory Auditors on the financial statement of the Company for the year 2016-17 is partof the Annual Report. There has been no qualification reservation or adverse remark ordisclaimer in their Report.
During the year under review the Auditors had not reported any matter under Section143 (12) of the Act therefore no detail is required to be disclosed under Section 134 (3)of the Act. M/s. Vijay Sehgal & Co. over many years have successfully met thechallenge that the size and scale of the Company's operations pose for auditors and havemaintained the highest level of governance ethical standards rigour and quality in theiraudit. The Board place on record its appreciation for the services rendered by M/s. VijaySehgal & Co. as the Statutory Auditors of the Company.
The Report of the Auditors on the financial statements including relevant notes on theaccounts for the Financial Year ended 31st March 2017 are selfexplanatory andtherefore do not call for any further comments.
The Board of Directors of your Company has reappointed M/s. Jain Singhal &Associates LLP Chartered Accountants New Delhi as Internal Auditors pursuant to theprovisions of Section 138 of the Companies Act 2013 for the financial year 20172018.
The Board of Directors of your Company has re-appointed M/s. Jitender Navneet &Co. Delhi Cost Accountants (Firm Registration No.00119) as Cost Auditors of the Companyfor the financial year 2017-2018.
The Board had re-appointed M/s Mahesh Gupta & Co. practicing Company SecretariesDelhi as Secretarial Auditor pursuant to the provisions of Section 204 of the CompaniesAct 2013. The Report of the Secretarial Auditor is annexed to the Report as per AnnexureA'.
Flex Middle East FZE UAE UFlex Europe Limited UK UFlex Packaging Inc. USA Flex P.Films (Brasil) Comercio De Films Plasticos Ltda (upto 28th March 2017) UPET HoldingsLtd. Mauritius UTech Developers Limited India and USC Holograms Pvt. Ltd. India areSubsidiary Companies u/s 2(87) of the Companies Act 2013. Further UPET (Singapore) Pte.Ltd. Singapore Flex Americas S.A. de C.V. Mexico Flex P. Films (Egypt) S.A.E EgyptFlex Films Europa Sp.zo.o. Poland Flex Films (USA) Inc. SD Buildwell Pvt. Ltd. RefexEnergy (Rajasthan) Private Limited and Bundelkhand Projects Private Limited are step-downsubsidiaries of the Company. During the Year Flex P. Films (Brasil) Comercio De FilmsPlasticos Ltda was ceased to be a WOS Company w.e.f. 28th March 2017.
In accordance with the General Circular issued by the Ministry of Corporate AffairsGovernment of India the Balance Sheet Profit and Loss Account and other documents of thesubsidiary companies are not being attached with the Balance Sheet of the Company. TheCompany will make available the Annual Accounts of the subsidiary companies and therelated detailed information to any member of the Company who may be interested inobtaining the same. The annual accounts of the subsidiary companies will also be kept openfor inspection at the Registered Office of the Company. The Consolidated FinancialStatements presented by the Company include the financial results of its SubsidiaryCompanies & Associate Companies.
Financial position of each of the Subsidiaries is provided in a separate statementattached to the Financial Statement pursuant to first proviso to Section 129(3) of theCompanies Act 2013.
Consolidated Financial Statements
The Consolidated Financial Statements of the Company are prepared in accordance withrelevant Indian Accounting Standards issued by the Institute of Chartered Accountants ofIndia and forms an integral part of this Report.
Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 a statement containing salient features of the financialstatements of Subsidiaries/Associate Companies/Joint Ventures is given in Form AOC-1 andforms an integral part of this Report.
CORPORATE SOCIAL RESPONSIBILITY
In accordance with the requirements of Section 135 of Companies Act 2013 your Companyhas a Corporate Social Responsibility (CSR) Committee which comprises Mr. M.G. GuptaChairman Mr. Achintya Karati Member and Mr. Amitava Ray Member. The terms of referenceof the Corporate Social Responsibility (CSR) Committee is provided in the CorporateGovernance Report. Your Company has also formulated a Corporate Social Responsibilitypolicy (CSR policy) which is available on the website of the Company at http://www.uflexltd.com/pdf/ policies/UFLEX-CSRPolicyPDF.
Annual report on CSR activities as required under the Companies (Corporate SocialResponsibility policy) Rules 2014 has been appended as Annexure -"B" and formsintegral part of this Report.
Your Company has taken adequate steps to ensure compliance with the provisions ofCorporate Governance as prescribed under SEBI (Listing of Obligations and DisclosureRequirements) Regulation 2015 with the Stock Exchanges.
A separate Report on Corporate Governance along with Report on Management Discussionand Analysis is enclosed as part of this Report as Annexure C' & D'.
Disclosure under Companies Act 2013
(i) Extracts of Annual Return
The details forming part of the Extracts of Annual Return is annexed as per AnnexureE'.
During the year Five Board Meetings and Four Audit Committee Meetings were convenedand held. The details of which are given in Corporate Governance Report appended hereto.
(iii) Composition of Audit Committee
The Board has constituted a Audit Committee which comprises of Mrs. Indu Liberhan asthe Chairperson and Mr. M.G. Gupta Mr. A. Karati Mr. T S. Bhattacharya and Mr. AmitavaRay as the Members. More details about the Committee are given in the Corporate GovernanceReport appended hereto.
(iv) Related Party Transactions
All related party transactions are negotiated on an arms-length basis and are inordinary course of business. Therefore the provisions of Section 188(1) of the CompaniesAct 2013 are not applicable. However suitable disclosure has been made in the notes tothe Financial Statements.
The Related party Transactions policy as approved by the Board is uploaded on theCompany's website: www.uflexltd.com at the weblinkhttp://www.uflexltd.com/policy-on-Related-party-Transactions.asp
(v) Particulars of Loans Guarantees and Investments
Details of Loans Guarantees and Investments are given in the accompanying FinancialStatements.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by any Regulator or Court whichwould impact the going concern status of the Company and its future operations.
INTERNAL FINANCIAL CONTROLS
A detailed note has been provided under Management Discussion and Analysis Reportappended hereto.
VIGIL MECHANISM AND WHISTLE BLOWER POLICY
Fraud-free and corruption-free work culture has been the core of the Company'functioning. In view of the potential risk of fraud and corruption due to rapid growth andgeographical spread of operations the company has put even greater emphasis to addressthis risk.
To meet this objective a Whistle Blower policy has been laid down. The same policy asapproved by the Board was uploaded on the Company's website www.uflexltd.com at weblinkhttp://www.uflexltd.com/ Whistle-Blower-policy.asp
pursuant to the provisions of the Companies Act 2013 and under Securities and ExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations 2015 theBoard has carried out an Annual performance Evaluation of its own performance and all theDirectors individually.
The evaluation of Non-Independent Directors Chairman and the Board as a whole was doneat a separate meeting by the Independent Directors.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. There were no complaint received from any employee during thefinancial year 20162017 and hence no complaint is outstanding as on 31.03.2017 forredressal.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL Year OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
There has been no material change and commitments occurred between the end of thefinancial year of the Company i.e. 31st March 2017 and the date of this reportaffecting financial position of the Company.
RISK Management Policy
Risk Management is a very important part of any business. Company's Risk Managementpolicy divides Risk into two broad categories; one Risk Associated at the TransactionalLevel and the other Risk Associated at the Decision Making Level.
In respect of the Risk Associated at Transactional Level the company has appropriatecontrol mechanism and operating effectiveness of the Internal Financial Controls and LegalCompliance System. The company has created appropriate structures with proper delegationof duties and responsibilities of employee at each level on enterprise basis forcompliances thereof.
In respect of Risk Associated at Decision Making level like political social &economic market technology capital structure foreign exchange & interest ratethey are evaluated before taking any strategic & financial decisions.
Adequacy and operative effectiveness of the Internal Financial Control and LegalCompliance System are periodically reviewed by the management Internal Auditorsstatutory auditors and the Audit Committee.
INTERNAL POLICY ON REMUNERATION
The company has Internal Remuneration Policy for Directors Key Management Personneland Senior Management Personnel. The policy takes into account several factors like agequalification years of experience in the industry/functional area and businessmanagement present emoluments and other qualitative factors such as leadership qualitiescommunication skills and performance track record. The aim is to ensure that the companyattracts and retains competent people.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will
be provided upon request. In terms of Section 136 of the Act the Report and Accountsare being sent to the Members and others entitled thereto excluding the information onemployees' particulars which is available for inspection by the Members at the RegisteredOffice of the Company during business hours on working days of the Company up to the dateof the ensuing Annual General Meeting. Member interested in obtaining a copy thereof maywrite to the Company Secretary in this regard.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided as per Annexure F'.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed as "Annexure G'.
During the year under review your Company received 30 awards and Accolades conferredby reputable organizations based out of India and overseas. The details of the Awards andAccolades are given in the company's web-site at http://www.uflexltd.com.
Personnel relations with all employees remained cordial and harmonious throughout theyear. Your Directors wish to place on record their sincere appreciations for thecontinued sincere and devoted services rendered by all the employees of the Company.
The Directors express their gratitudes and thanks to all the Indian and InternationalFinancial Institutions & Banks Government Authorities both India & overseas wherecompany's operations are carried out. Shareholders Customers Suppliers and otherBusiness Associates for their continued co-operation and patronage.
| ||For & On behalf of the Board |
| ||Ashok Chaturvedi |
| || |
|Place : NOIDA C ||:hairman & Managing Director |
|Dated : 30th May 2017 ||(DIN 00023452) |