DIRECTORS REPORT AND MANAGEMENT DISCUSSION & ANALYSIS REPORT
Unitech International Limited
Your Directors have pleasure of presenting before you the 21st Annual Reportof your Company along with the Audited Accounts of the Company for the financial yearended 31st March 2016. The Management Discussion and Analysis is also includedin this report.
1. SUMMARY OF FINANCIAL RESULTS:
The Company s financial performance for the year ended 31st March 2016 issummarized below:
|PARTICULARS ||YEAR ENDED 31/03/2016 ||YEAR ENDED 31/03/2015 |
|Total Revenue ||Rs.125482436 ||Rs.916474909 |
|Profit Before Interest Depreciation & Tax ||Rs.17478553 ||Rs.14391546 |
|Depreciation for the year ||Rs.10025643 ||Rs .9787467 |
|Interest Cost ||Rs.7452910 ||Rs.4604079 |
|Profit Before Taxation ||Rs.3263653 ||Rs.841258 |
|Provision for Income Tax ||Rs.(915565) ||Nil |
|Provision for Deferred Tax ||Rs.602980 ||Nil |
|MAT Credit Entitlement availed ||Rs.0 ||Nil |
|Profit After Taxation ||Rs.2951068 ||Rs.841258 |
|Add: Profit Brought Forward from Previous Year ||Nil ||Nil |
|Less: Dividend Including Dividend Distribution Tax ||Nil ||Nil |
|Balance carried to Balance Sheet ||Nil ||Nil |
The Company has made Profit of Rs.2951068/- after taxes during the financial year.Despite of falling demand and steep drop in prices in global as well as in domesticmarket your Company has improved its financial health compare to previous year byminimizing cost impact in such challenging conditions. Company has also increase salesduring the year due to economies of scale and back to back orders.
Your Directors expects to achieve better performance in the future by taking maximumefforts to control the costs and optimize the results in the coming years.
During the year under review owing to the fund requirements for business expansionplans and to conserve the resources your Directors do not recommend any dividend.
4. TRANSFER TO RESERVES:
During the year under review no amount from Profit was transferred to General Reserveand Securities Premium Account.
5. ACCEPTANCE OF DEPOSIT:
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
The Board of Directors of the Company at present comprises of all 4 Directors whohave wide and varied experience in different disciplines of corporate functioning. YourCompany does not have an optimum composition of Independent Directors as required underSection 149 of the Companies Act 2013 and SEBI (LODR) Regulations 2015 due to its weakfinancial health. However Company is in search to appoint Independent Directors to seektheir expertise in respected fields.
The details are as below:-
|Sr. No. ||Name of the Director & DIN No. ||Designation |
|1. ||Mr. Dhruv Desai ||Chairman & Managing Director |
| ||DIN No. 00493960 || |
|2. ||Mr. Joseph Mathoor ||Non Executive Director |
| ||DIN No. 02087812 || |
|3. ||Mr. Grace Jose Mathoor ||Non Executive Director |
| ||DIN No. 07140028 || |
|4. ||Mr. Thomas Joseph ||Independent Director |
| ||DIN No. 07264096 || |
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013.
None of the Directors resigned during the financial year 2015 2016
7. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE ENDOF THE FINANCIAL YEAR AND DATE OF THE REPORT:
There are no significant events affecting the financial position between the end of thefinancial year and date of the Report except the following:
The Board recommends M/s. S S Agarwal & CO. Chartered Accountants as statutoryauditors of the Company for the year 2016-17 who have also confirmed their appointmentshall be within the limits prescribed under Section 141 of the Companies Act 2013 ifappointed.
Necessary Resolutions for their appointment has been proposed for the consideration ofthe Members of the Company.
Since notes to account are self explanatory no further explanation is given by theBoard as such. The observation made in the Auditors' Report read together with relevantnotes thereon are self explanatory and hence do not call for any further comments underSection 134 of the Companies Act 2013.
8. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to provisions of section 134(3)(c) of the Companies Act 2013 the Directorsconfirm that to the best of their knowledge and belief:
In the preparation of Annual Accounts the applicable Accounting Standards have beenfollowed along with proper explanation relating to material departures;
a) 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;
b) The directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
c) The director had prepared the annual accounts ongoing concern basis; and
d) The director had laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and were operating effectively;
e) The director had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
9. CORPORATE SOCIAL RESPONSIBILITY:
The provisions of Section 135 of the Companies Act 2013 relating to Corporate SocialResponsibility (CSR) are not applicable to the Company as the Company has posted losses.
10. DISCLOSURE AS PER THE SECTION 134 OF THE COMPANIES ACT 2013 READ WITH RULE 8 OFTHE COMPANIES (ACCOUNTS) RULES 2014:
a) Extract of Annual Report:
The extract of Annual Report in the Form MGT-9 is annexed to this report as Annexure"1"
b) Declaration by Independent Directors:
The Board has received the declaration from all the Independent Directors as per theSection 149(7) of the Companies Act 2013 and the Board is satisfied that all theIndependent Directors meet the criteria of independence as mentioned in Section 149(6) ofthe Companies Act 2013.
Companys Policy on Directors appointment and Remuneration:
The Nomination Remuneration and Compensation Committee has put in a place the policy onboard diversity for appointment of directors taking into consideration qualification andwide experience of the directors in the fields of banking finance regulatoryadministration legal commercial vehicle segment apart from compliance of legalrequirements of the Company.
The remuneration policy of the Company has been so structured in order to match themarket trends of the Chemical and Fertilisers industry. The Board in consultation with theNomination and Remuneration & Compensation Committee decides the remuneration policyfor Directors. The Company has made adequate disclosures to the members on theremuneration paid to Directors from time to time. Remuneration/ Commission payable toDirectors is determined by the contributions made by the respective Directors for thegrowth of the Company.
The Policy of the Company on Director s appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a Directorand other matters as required under Section 178 sub-section 3 of the Companies Act 2013is available. We affirm that the remuneration paid to the Directors is as per the termslaid out in the nomination and remuneration policy of the Company.
c) Board Evaluation:
As required under the provisions of Section 134(3)(p) and Regulation 27 of the ListingRegulations the Board has carried out an annual performance evaluation of its ownperformance and the manner in which such performance evaluation was carried out is asunder: The performance evaluation framework is in place and has been circulated to all thedirectors to seek their response on the evaluation of the entire Board and independentdirectors. The Nomination and Remuneration & Committee has carried out evaluation ofdirector s performance. The criteria of evaluation is exercise of responsibilities in abona fide manner in the interest of the Company striving to attend meetings of the Boardof Directors/ Committees of which he/she is a member/ general meetings participatingconstructively and actively in the meetings of the Board /committees of the Board etc.
d) Particulars of Contracts or Arrangements with Related Parties:
All related party transactions that were entered into during the financial year were onan arm s length basis and were in the ordinary course of business. There are no othermaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
e) Risk Management Policy:
During the year Management of the Company evaluated the existing Risk ManagementPolicy of the Company to make it more focused in identifying and prioritizing the risksrole of various executives in monitoring & mitigation of risk and reporting process.Its aim is to enhance shareholders value and provide an optimum risk-reward tradeoff. TheRisk Management Policy has been reviewed and found adequate to the requirements of theCompany and approved by the Board.
The Management evaluated various risks and that there is no element of risk identifiedthat may threaten the existence of the Company.
f) Whistle Blower Policy / Vigil Mechanism:
The Company has established a whistle-blower policy and also established a mechanismfor directors and employees to report their concerns.
g) Financial Summary/ Highlights:
The details are spread over in the Annual Report as well as are provided in thebeginning of this report.
h) Internal Financial Control System and their Adequacy:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit reports are reviewed by Audit Committee.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
i) Conservation Of Energy Technology Absorption & Foreign Exchange Earning AndOutgo:
Particulars as prescribed under section 134 (3) (m) of the Companies Act 2013 readwith the Rule 3 of Companies (Account) Rules 2014 or any other law as may be applicableare given in Annexure "2" enclosed.
j) Particulars Of Loans Guarantees And Investments U/S 186:
There are no instances of loans guarantees or investments under section 186 of theCompanies Act 2013. The details of the investments made by company are given in the notesto the financial statements.
11. BOARD MEETINGS BOARD OF DIRECTORS KEY MANAGERIAL PERSONNEL & COMMITTEES OFDIRECTORS
a) Board of Directors:
As members must be aware that at present the Board of Directors is consists of 4Directors namely Mr. Dhruv Desai as Chairman and Managing Director Mr. Joseph MathoorMr. Grace Jose Mathoor and Ms. Thomas Joseph as Directors of the company.
b) Board Meetings:
The Board of Directors of the Company met 4 times during the year 2015- 2016. The gapintervening between two meetings of the board is as prescribed in the Companies Act 2013.
c) Changes in Directors & Key Managerial Personnel
There have been no changes in the Directors and Key Managerial Personnel during theFinancial Year 2015-2016.
The Company has received necessary declarations from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that they meet the criteria ofindependence as laid down in Section 149(6) of the Companies Act 2013
d) Board Committees
The Company has the following Committees of the Board along with details of itscompositions
|Sr. No. ||Name of the Committee ||Members of the Committee |
|1. ||Audit Committee ||Mr. Thomas Joseph Chairman |
| || ||Mr. Dhruv Desai Member |
| || ||Mr. Joseph Mathoor Member |
|2. ||Nomination and Remuneration Committee ||Mr. Thomas Joseph Chairman |
| || ||Mr. Joseph Mathoor Member |
| || ||Mr. Dhruv Desai Member |
|3. ||Stakeholders Relationship Committee ||Mr. Thomas Joseph Chairman |
| || ||Mr. Joseph Mathoor Member |
| || ||Mr. Dhruv Desai Member |
12. AUDIT COMMITTEE OF THE BOARD OF DIRECTORS:
The Audit committee comprises of Mr. Thomas Joseph (Chairman) Mr. Dhruv Desai(Member) Mr. Joseph Mathoor (Member) of the Company. There were four meetings of theAudit Committee during the year. The details of various Audit Committee meetings areprovided in the Corporate Governance Report.
13. AUDIT COMMITTEE RECOMMENDATION:
During the year all the recommendations of the Audit Committee were accepted by theBoard. The Composition of the Audit Committee is as described in the Corporate GovernanceReport.
14. NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee comprises of Mr. Thomas Joseph as ChairmanMr. Dhruv Desai and Mr. Joseph Mathoor as members of the Company. The meeting ofNomination and Remuneration Committee was conducted during the year 2015-16 as there wereno appointments change in designation and policy was framed by the Committee. The Boardhas on the recommendation of the Nomination & Remuneration Committee framed a policyfor selection and appointment of Directors Senior Management and their remuneration. Thepolicy relating to the remuneration for the directors key managerial personnel and otheremployees is disclosed as Annexure "4".
15. STAKEHOLDERS' RELATIONSHIP COMMITTEE:
The Stakeholders Relationship Committee comprises of Mr. Thomas Joseph (Chairman) Mr.Dhruv Desai (Member) and Mr. Joseph Mathoor (Member) of the Company. The Committee metfour times during the year.
16. INTERNAL AUDITOR:
The Company has internal financial controls set out in the accounting system and Headof the Department controls all the financial and accounting decisions in the capacity asInternal Auditor.
16. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND ("IEPF").
As required under the provisions of Section 205A and 205C and other applicableprovisions of Companies Act 1956 (the corresponding provisions in the Companies Act 2013have not been notified and hence the earlier law is still applicable in respect of theseprovisions) dividends that remain unpaid/unclaimed for a period of seven years are to betransferred to the account administered by the Central Government viz: "InvestorProtection and Education Fund".
During the year there were no transfer made on account of IEPF also there were no anyunclaimed dividend remained in the bank account so far.
17. SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
During the year there were no significant and material orders passed by the Regulatorsor Courts.
Cash and cash equivalents as at March 31 2016 was Rs. 25278587 (in earlier it wasRs.15482205).The company continues to focus on judicious management of its workingcapital. Receivables inventories and other working capital parameters were kept understrict check through continuous monitoring.
19. DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:
As requirement of Sexual Harassment of Woman at Workplace (Prevention Prohibition andRedressal) Act 2013. Company has already maintained internal policy to prevent women sharassment at work place and covered all employees so they could directly make complaintsto the committee if such situation arises. The management and Committee together withconfirm total number of complaints received and resolved during the year is as follows:
a) No. of complaints received: NIL
b) No. of complaints disposed: NIL
20. INDUSTRIAL RELATIONS:
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
21. DIRECTORS DISQUALIFICATION:
None of the directors of the Company is disqualified as per the provision of section164(2) of the Companies Act 2013 or any other law as may be applicable as on 31stMarch 2016.
22. HUMAN RESOURCES:
None of the employees of the Company had drawn remuneration in excess of the limitsprescribed In terms of the provisions of Section 197(12) of the Act read with Rules 5(2)and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 or any other law as may be applicable. The relation between employees and managementare cordial during the year.
23. SUBSIDIARY COMPANIES:
The Company does not have any subsidiary during the year.
M/s S S Agarwal & Co. Chartered Accountants (Membership No-050521) as theStatutory Auditors of the Company to hold office till the conclusion of the Annual GeneralMeeting to be held in the calendar year 2016 be and is hereby ratified and that the Boardof Directors be and is hereby authorized to fix the remuneration payable to them for thefinancial year 2016-2017 as may be agreed upon by the Audit Committee/ Board of Directorsin consultation with the Auditors."
25. AUDITORS REPORT:
The observation made in the Auditors' Report read together with relevant notes thereonare self explanatory and hence do not call for any further comments under Section 134 ofthe Companies Act 2013.
26. SECRETARIAL AUDIT:
The Board had appointed M/s. DSM & Associates Company Secretaries to carry outSecretarial Audit under the provisions of Section 204 of the Companies Act 2013 and theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 for thefinancial year 2015-16. The Secretarial Audit Report is annexed to this report as Annexure"5". Comments on Secretarial Audit Report are as follows:
1. The Company has not appointed Company Secretary as required under Section 203 of theCompanies Act 2013 and Regulation 6 of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.
2. The Company has designated Mr. Dhruv Desai on 30th September 2016 as KeyManagerial Personnel as required under Section 203 of the Companies Act 2013. HoweverCompany has not appointed any Chief Financial Officer (CFO) during the year under review.
3. The Company does not have any optimum composition of Board of Directors as requiredunder Section 149 of the Companies Act 2013 and as under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
4. The Company has not appointed Internal Auditor as required under Section 138 of theCompanies Act 2013. 5. The Company as not repaid the unsecured loan during the year asrequired under Section 73 & 76 of the Companies Act 2013 and Companies (Acceptance ofDeposits) Rules 2014.
In this Connection your Directors wish to submit as under:
As regards point no. 1 2 and 4 the Company is in the process of appointing CompanySecretary as Compliance officer and designate Chief Financial Officer (CFO) as KeyManagerial Personnel as required under Section 203. Company is in search of suitablecandidate to appoint a person as an Internal Auditor who posses requisite expertise andis taking appropriate step to comply with the said qualification.
3. Company is taking efforts to appoint suitable candidates as Independent Directors ofthe Company.
5. Your Directors and their relatives have committed to the financial institutions forthe infusion of funds in the Company s business. Hence Company is not in a position torepay the same to Directors and Their relatives. Accordingly the provisions of Section 73and 76 of the Companies Act 2013 are attracted to the extent applicable.
Your Directors take this opportunity to express their gratitude to all ShareholdersInvestors clients vendors bankers Regulatory and Government authorities StockExchanges and business associates for their cooperation encouragement and continuedsupport extended to the Company. Your Directors also wish to place on record theirappreciation to the Associates for their continuing support and unstinting efforts inensuring an excellent all round operational performance at all levels.
By Order of the Board
For Unitech International Limited
Date: 12th August 2016.
Registered Office: Office No. 1 & 2 Plot No. 353 A
TPS-III Garodia Nagar 90ft. road Opp. Jai Bhandhu Bldg
Ghatkopar (East) Mumbai 400 077.