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Aanchal Ispat Ltd.

BSE: 538812 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE322R01014
BSE 00:00 | 06 May 5.17 -0.11
(-2.08%)
OPEN

5.25

HIGH

5.54

LOW

5.03

NSE 05:30 | 01 Jan Aanchal Ispat Ltd
OPEN 5.25
PREVIOUS CLOSE 5.28
VOLUME 25492
52-Week high 7.71
52-Week low 3.84
P/E
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 5.25
CLOSE 5.28
VOLUME 25492
52-Week high 7.71
52-Week low 3.84
P/E
Mkt Cap.(Rs cr) 11
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Aanchal Ispat Ltd. (AANCHALISPAT) - Director Report

Company director report

Dear Shareholders

Your Directors are pleased to present the 24th Annual Report of your company on theoperations and performance along with the Audited Financial Statements for the year endedon 31st March 2019.

FINANCIAL HIGHLIGHTS

During the financial year 2018-19 the Company recorded an impressive performance byrecording its highest EBITDA and Profit after tax (PAT). While EBITDA registered anincrease by 39.12% PAT improved by 110.92%. Improved productivity from our mills helpedto generate more volume for sales revenue and lower manufacturing cost from more efficientoperations. The Company continued to focus on important initiatives for improving safetyand environmental compliance as well as improving the customer experience and operationalefficiencies.

The Company's financial performance for the year ended 31st March 2019 is summarisedbelow:

(Rs. in lacs)
PARTICULARS 2018-2019 2017-2018
Sales and other operating Income 35367.83 38510.31
Earnings before InterestTax Depreciation& amortization (EBITDA) 1070.23 769.24
Finance costs 568.76 472.95
Depreciation and amortization expenses 74.93 73.42
Profit/ (loss) before tax 426.54 222.87
a) Current Tax 150.09 67.72
b) Current Tax Expense relating to Prior Year's - 6.13
c) Deferred Tax (3.49) 16.30
Profit/(loss) for the period 279.94 132.72

RESULTS OF OPERATIONS AND STATE OF THE COMPANY'S AFFAIRS:

The Company's revenue in FY2018-19 was at Rs. 35367.83 Lakhs. EBIDTA stood atRs.1070.23 lakhs compared to Rs. 769.24 lakhs in the previous year. The Company reportedpost-tax profit of Rs. 279.94 Lakhs in FY2018-19 compared to a post-tax profit of Rs.132.72 Lakhs in the previous year.

During the current financial year 2018-19 no amount has been appropriated to GeneralReserve.

BUSINESS ACTIVITY

The company is engaged in manufacturing of wide range of TMT Bars MS Rounds &Angulars besides Trading of Steel Products etc. There has been no change in the nature ofbusiness of the Company.

SHARE CAPITAL

The paid up Equity Share Capital as at March 31 2019 stood at Rs. 20.85 cores. Duringthe year under review the Company has not issued shares or convertible securities orshares with differential voting rights nor has granted any stock options or sweat equityor warrants. As on March 31 2019 none of the Directors of the Company hold instrumentsconvertible into Equity Shares of the Company.

DIVIDEND

In order to conserve the resources for meeting future capital needs related tomaintenance regulatory cost reduction and potential strategic projects the Board ofDirectors have decided not to recommend dividend on the equity shares of the Company.

DEPOSITS

The Company has not accepted any public deposit during the year under review and noamount against the same was outstanding at the end of the year.

SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES

The company is not having holding or subsidiary company during the year and no othercompany has become holding / subsidiary/ joint venture.

REGULATORY STATEMENT

In conformity with provision of regulation 34(2)(c) of SEBI (LODR) Regulations 2015the Cash Flow Statement for the year ended 31.03.2019 is annexed hereto. The equity sharesof the Company are listed on the BSE Ltd. The Company has paid listing fees for the year2018-19 to above stock exchange

ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

As required under Section 134 (3) (m) of the Act read with Rule 8 of The Companies(Accounts) Rules 2014 particulars relating to conservation of Energy R & DTechnology absorption and foreign Exchange earnings / outgo are separately provided in theannexure to this report as Annexure - A. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT

As per the terms of Regulation 34(2) read with Schedule V of SEBI Listing RegulationsManagement's Discussion and Analysis Report for the year under review is presented in aseparate section forming part of the Annual Report.

DETAILS OF RELATED PARTIES TRANSACTIONS PURUSANT TO SECTION 188(1) OF THE COMPANIESACT 2013

During the financial year all transactions entered into with the Related Parties asdefined under Companies Act 2013 were in the ordinary course of business on arm's lengthbasis and as such did not attract provisions of Section 188 (1) of Companies Act 2013.Company has formulated policy on related party transactions. Particulars of related partytransactions pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies(Accounts) Rules 2014 in Form AOC-2 is attached at Annexure –B. Approvalsfrom the Audit Committee are obtained even for transactions which are in ordinary courseof business and repetitive in nature. Further on quarterly basis disclosures are made tothe Audit Committee and to the Board in its meetings. Details of related partytransactions are given in the notes to financial statements.

DETAILS OF DIRECTORS OR KMPS' APPOINTMENT OR RESIGNATION

During the year under review there are changes in the Composition of the Board. In theyear under review Ms. Preetee Agarwal and Shri Sudhir Kumar Budhia Directors resignedfrom the post w.e.f. 30th May 2018 and w.e.f 14th August 2018 respectively. The Boardappreciates the valuable services rendered by them during their tenure.

Shri Vijay Srivastava was appointed as Executive Director w.e.f. 14th August 2018 andMs. Nilu Nigania and Ms. Babita Kaur Bagga were appointed as the Independent directorw.e.f 14th August 2018 and 14th November 2018 respectively.

None of the Directors are disqualified from being appointed as Directors as specifiedin Section 164 of the Companies Act 2013.

Director retiring by Rotation

In accordance with the provisions of Section 152 of the Companies Act 2013 andArticles of Association of the Company Mr. Vijay Srivastava (DIN: 03618949) retires byrotation at the ensuing Annual General Meeting and being eligible offers himself forre-appointment. The Board of Directors on recommendation of Nomination & RemunerationCommittee has recommended for the approval of appointment/ re-appointment of the aforesaidDirectors at the ensuing Annual General Meeting. The brief details of the Directors to beappointed/re-appointed as required under Regulation 36 of the SEBI Listing Regulation aregiven in the Notice convening the ensuing Annual General Meeting.

NUMBER OF MEETINGS OF THE BOARD

The Board of Directors met 4 (FOUR) times during the financial year detailedinformation about dates of meetings and attendance of Directors thereat is given in theCorporate Governance Report annexed to this report. The intervening gap between any twomeetings was not more than one hundred twenty days as mandated under the provisions ofSection 173 of the Companies Act 2013 and Regulation 17(2) of the SEBI ListingRegulations.

BOARD DIVERSITY

A diverse Board enables efficient functioning through differences in perspective andskill and also fosters differentiated thought processes at the back of varied industrialand management expertise gender knowledge and geographical background. The Companyfollows diverse Board structure.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Audit Nomination & Remuneration and otherCommittees. The Board's performance for the year under review was assessed on the basis ofparticipation of directors quality of information provided/available quality ofdiscussion and contribution etc. A structured questionnaire was prepared after taking intoconsideration inputs received from the directors covering the aforesaid aspects of theBoard's functioning. The overall performance of the Board and Committees of the Board wasfound satisfactory.

The overall performance of Chairman Executive Directors and the Non-ExecutiveDirectors of the Company was found satisfactory. The review of performance was based onthe criteria of performance knowledge analysis quality of decision making etc. Themanner and detail in which evaluation was carried out is stated in the CorporateGovernance Report which forms a part of this annual report.

AUDIT COMMITTEE

The Audit Committee comprises of Ms. Nilu Nigania Mr. Mukesh Agarwal Mr. Manoj Goeland Ms. Babita Kaur Bagga. Ms. Nilu Nigania is the chairperson of the committee.

During the year Ms. Preetee Agarwal and Mr. Sudhir Kumar Budhia resigned from themembership in the committee as a member at the Board meeting dated May 30 2018 andAugust 14 2018 respectively and Ms. Nilu Nigania & Ms. Babita Kaur Bagga wereinducted as the member of the committee vide Board meeting dated 14th August 2018 and14th November 2018 respectively and accordingly the Audit Committee was reconstituted.

The Committee inter alia reviews the Internal Control System and Reports of InternalAuditors and Compliance of various Regulations. The brief terms of reference of theCommittee and the details of the Committee meetings are provided in the CorporateGovernance Report. The Committee also reviews the Financial Statements before they areplaced before the Board.

DIRECTORS RESPONSIBILITY STATEMENT

In compliance with the provisions of Section 134(5) of the Companies Act 2013 theBoard of Directors to the best of their knowledge and hereby confirm the following:

(a) in the preparation of the annual accounts for the financial year ended 31st March2019 the applicable accounting standards had been followed along with proper explanationrelating 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 as at 31st March 2019 and profit andloss account of the Company for that period;

(c) the directors had taken proper and sufficient care 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) the directors had prepared the annual accounts on a going concern basis;

(e) The directors of the company had laid down internal financial controls to befollowed by the company and that such internal financial controls are adequate and wereoperating effectively; 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.

KEY MANAGERIAL PERSONNEL

The Following director/officials of the Company have been designated as Key ManagerialPersonnels (KMP's) of the Company by the Board of Directors in terms of provisions ofSection 203 of the Companies Act 2013 and the Regulations: (There is no change in theKMP's during the year under review)

1. Mr . Mukesh Goel Managing Director;

2. Mr . A.S Nageswar Rao Chief Financial Officer;

3. Ms. Neha Sharma Company Secretary & Compliance Officer.

DECLARATION FROM INDEPENDENT DIRECTORS

The terms & condition for appointment of Independent Directors are as per theprovisions of Section 149 & Schedule IV of the Companies Act 2013. The Company hasreceived necessary declarations from all Independent Directors confirming that they meetthe criteria of Independence as laid down under Section 149(6) of the Companies Act 2013and under Regulation 16(1)(B) of the SEBI (Listing obligations and Disclosurerequirements) Regulations 2015. And there has been no change in the circumstances whichmay affect their status as Independent directors during the year.

CODE OF CONDUCT

The Code of Conduct of Directors KMP‘s and Senior executive of the Company isalready in force and the same has been placed on the Company's website www.aanchalispat.comand the declaration for the affirmation with the same forms a part of this annual report.

CORPORATE GOVERNANCE

Your Company has practised sound Corporate Governance and taken necessary actions atappropriate times for enhancing and meeting stakeholders' expectations while continuing tocomply with mandatory provisions of Corporate Governance. Your Company has complied withthe requirements of all applicable regulations read with Schedule-V of SEBI Listingregulations as issued by SEBI and amended from time to time.

A report on Corporate Governance along with certificate from M/s Raj Chandra &Associates Chartered Accountants regarding compliance of conditions is presented in aseparate section forming part of the Annual Report.

POLICY RELATING TO DIRECTORS APPOINTMENT PAYMENT OF REMUNERATION AND DISCHARGE OFTHEIR DUTIES

The policy of the Company on Director's appointment and remuneration includingcriteria for determining qualifications independence and other matters is as providedunder subsection(3) of Section 178 of the Companies Act 2013 is available on thecompany's website at www.aanchalispat.com.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

The particulars of employees as required under Section 197 (12) of the Act read withRule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 (as amended) are given in separate annexure attached hereto as Annexure-C andforms a part of this report. Further stating there were no such employees drawingremuneration in excess of the limits set out in Section 197 (12) of the Companies Act2013 read with Rule 5(2) & 5 (3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014.

AUDITORS & AUDITORS' REPORT

Statutory Auditors

M/s Raj Chandra & Associates Chartered Accountants (Firm Registration No.326312E) were appointed as Statutory Auditors of the Company for a term of five yearsat the 21st Annual General Meeting held on 28th September 2016 as per the provisions ofCompanies Act 2013. They have confirmed that they are not disqualified from continuing asAuditors of the Company. The notes on financial statement referred to in the Auditors'Report are self-explanatory and do not call for any further comments. The Auditors' Reportdoes not contain any qualification reservation adverse remark or disclaimer.

Cost Auditor

Pursuant to the provisions of Section 148 of the Companies Act 2013 and the Rules madethere under M/s. A.S. & Associates Cost Accountants (Firm Registration no.000523) were appointed for auditing cost accounting records of the Company for theyear ending 31st March 2019. Board has further appointed M/s. A.S & AssociatesCost Accountants (Firm Registration no. 000523) as Cost Auditors for the yearending 31st March 2020 subject to approval of remuneration in the forthcoming AnnualGeneral Meeting.

Internal Auditor

The Company has appointed M/s R. Modi & Co.(FRN: 327727E) an Independentfirm of Chartered Accountants to act as an Internal Auditor as per suggestion of auditorsand recommendation of the Audit Committee in order to strengthen the internal controlsystem for the Company.

Secretarial Auditor

Pursuant to the provisions of Section 204(1) of the Companies Act 2013 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed Ms. Manisha Saraf Company Secretary in whole time practice (MembershipNo. FCS-7607 Certificate of Practice No.-8207) as the Secretarial Auditor of theCompany for the Financial Year 2018-2019 to conduct the Secretarial Audit. The SecretarialAudit Report for the financial year ended 31st March 2019 has been annexed as Annexure-D and forms a part of this annual report.

The Secretarial Audit Report does not contain any qualification reservation adverseremark or disclaimer except some minor comments for which management is taking necessarysteps to avoid the same in future.

SECRETARIAL STANDARDS

The directors state that applicable Secretarial Standards i.e. SS-1 & SS-2relating to ‘Meeting of the Board of Directors' and ‘General Meeting'respectively have been duly followed by the Company.

RISK MANAGEMENT POLICY

The risk management strategy of your Company is based on a clear understanding ofvarious risks and adherence to well-laid out risk policies and procedures that arebenchmarked with industry best practices. The Company has developed robust systems andembraced adequate practices for identifying measuring and mitigating various risks –business strategic operational market credit liquidity reputational and processrisks and ensuring that they are maintained within pre-defined risk appetite levels.

ANNUAL RETURN

In terms of provisions of Section 92(3) of the Companies Act 2013 and Rule 12 of theCompanies (Management & Administration) Rules 2014 a copy of the Annual return asprescribed under Section 92 of the Companies Act 2013 forms a part of this report and isannexed as Annexure-E and the same can also be assessed at the website of theCompany at www.aanchalispat.com

DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIALRESPONSIBILITY INITIATIVES

The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the provisions of section 135 of the Companies Act 2013 along withCompanies (Corporate Social Responsibility Policy) Rules 2014 as they are not applicable.

VIGIL MECHANSIM POLICY

The Company had implemented a vigil mechanism where by employees directors and otherstakeholders can report matters such as generic grievances corruption misconduct fraudmisappropriation of assets and non-compliance of code of conduct to the Company. Thepolicy safeguards the whistleblowers to report concerns or grievances and also provides adirect access to the Chairman of the Audit Committee. During the year under review none ofthe personnel has been denied access to the Chairman of Audit Committee.

The policy with the designation and address of the Competent Authority ExecutiveChairman/Managing Director of the Company and Chairman of the Audit Committee has beencommunicated to the employees by uploading the same on the website of the Company.

INTERNAL FINANCIAL CONTROLS

The Company has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the Company's Policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of accounting records and the timely preparation of financial disclosures.

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. These are routinely tested and certified by Statutory aswell as Internal Auditor. Significant audit observations and corrective action arereported to the Audit Committee.

The concerned executives monitors and evaluates the ef_cacy and adequacy of internalcontrol 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 corrective actionsthereon are presented to the Audit Committee.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIESACT 2013

During the year under review the Company has not made any inter corporate loansinvestments given any corporate guarantee to any other body corporate subsidiaryassociate or any other company.

INSURANCE

The Company has taken appropriate insurance for all assets against foreseeable perils.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

There were no complaints pending for the redressal at the beginning of the year and nocomplaints received during the financial year.

COURT/TRIBUNAL ORDERS

There were no instances of any significant and material orders passed by the regulatorsor courts or tribunals impacting the going concern status and Company's operations infuture.

MATERIAL CHANGES AFFECTING THE COMPANY

There are no material changes and commitments affecting the financial position of theCompany between the end of the financial year and the date of this report. There has beenno change in the nature of business of the Company.

APPRECIATION

The Board of Directors thank the shareholders for their continued support and theywould like to place on record their appreciation for the dedicated services rendered bythe Employees at all levels. We thank our customers vendors dealers investors businessassociates and bankers for their continued support during the year. We place on record ourappreciation of the contribution made by the employees at all levels. Our resilience tomeet challenges was made possible by their hard work solidarity co-operation andsupport.

For and on Behalf of the Board of Directors
Sd/-
Place: Howrah (Mukesh Goel)
Date: 28th May 2019 Managing Director
(DIN: 00555061)

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