Your Directors have pleasure in presenting their Thirtieth Annual Report on thebusiness and operations ofthe Company and the Audited Accountsfor the Financial Year endedMarch 312017.
1. Financial Summary/Performance ofthe Company
The summary of standalone (Company) and consolidated (Company and its subsidiaries)operating results for the financial year under review along with the figures for previousyear are as follows:
(Rs in Lakhs)
|Sr. No. Particulars || |
| ||31.03.2017 ||31.03.2016 ||31.03.2017 ||31.03.2016 |
|1 NetSales/IncomefromOperations ||14169.73 ||13886.15 ||18130.96 ||17382.52 |
|2 Otherlncome ||263.78 ||224.83 ||223.11 ||179.33 |
|3 Total lncome(1+2) ||14433.51 ||14110.98 ||18354.07 ||17561.85 |
|4 Total Expenditure ||12138.04 ||12059.93 ||15180.38 ||14443.89 |
|5 Operating Profit before Finance Cost Depreciation Tax and Minority Interest (3-4) ||2295.47 ||2051.05 ||3173.69 ||3117.96 |
|6 FinanceCost ||492.29 ||485.67 ||1020.16 ||799.47 |
|7 Depreciation ||482.76 ||458.67 ||567.17 ||543.09 |
|8 Profit beforeTax and Minority Interest (5-6-7) ||1320.42 ||1106.71 ||1586.36 ||1775.40 |
|9 Provision forTaxation ||488.31 ||401.65 ||579.89 ||560.85 |
|10 Net Profit afterTax and before Minority Interest (8-9) ||832.11 ||705.06 ||1006.46 ||1214.55 |
|11 Minority Interest || ||- ||71.35 ||123.38 |
|12 Net Profit afterTax & Minority Interest (10-11) ||832.11 ||705.06 ||935.11 ||1091.16 |
1. The previous year figures has been regrouped wherever necessary.
2. Figures has been rounded off to nearest decimal 2. Performance Review
The Company undertakes aggressive sales promotion activities to create strong brandawareness and also took several growth initiatives to increase volumes during the year. Asa result the Company had a year of impressive performance with Sales Turnover increasedto Rs 14169.73 lakhs as against Rs13886.15 lakhs in the previous year.
The Profit after tax for the year increased from Rs 705.59 lakhs in the previous yearto Rs 832.11 lakhs in financial year 2016-17.
On consolidated basis Sales turnover of your Company for the year was Rs 18130.96Lakhs as against Rs 17382.52 Lakhs in the previous year. The Consolidated Profit beforeTaxation and Minority Interest wasRs 1586.36 Lakhs againstRs 1775.40 Lakhs in theprevious year. The Consolidated Profit after
Tax and Minority Interest wasRs 935.11 Lakhs against Rs 1091.16 Lakhs in thepreviousyear.
Considering the consistent financial performance of your Company and promising futureprospects while retaining capital to maintain a healthy Capital Adequacy Ratio and tosupport future growth your Board of Directors recommend a final dividend of 50% (Rs 5/-perEquity Share) on Equity Shares of Rs 10/- for the financial year ended March 31 2017. Theproposal is subject to the approval of shareholders at the ensuing Annual General Meeting.
The Register of Members and Share Transfer Books will remain closed from September 142017 to September 20 2017 (both days inclusive)for the purpose of payment of the finaldividend for the financial year ended March 312017.
4. Material Changes Transaction and Commitment/ Change in the Nature of Business ifany
No material changes and commitments affecting the financial position of the Companyoccurred during the financial year to which this financial statements relate and the dateof this Report.
During the year under review no significant or material order was passed by theRegulators or Courts or Tribunals which impact the going concern status and Company'soperations in future.
5. Management Discussion and Analysis(MDA)
In terms of the provisions of Regulation 34 of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 theManagement's Discussion and Analysis is set out in this Annual Report.
6. Share Capital
The paid up Equity Share Capital as on 31st March 2017 stands atRs51889760 divided intoRs 5188976 equity shares ofRs 10/- each. The Company has neitherissued shares with differential rights as to dividend voting or otherwise nor issuedshares to the employees or Directors of the Company under any Scheme (including sweatequity shares) during theyear.
7. Transferto Reserves
The Company proposes to transfer sum ofRs 300.00 Lakhs to the General Reserves. Anamount of Rs 1836.10 Lakhs is proposed to be retained in the Statement of Profit and Lossof standalone financials.
8. Subsidiary Companies
As on March 31 2017 the Company has six subsidiaries including two overseassubsidiaries and one step down overseas subsidiary. There has been no material change inthe nature of the business of the subsidiaries.There are no associate companies or jointventure companies within the meaning of Section 2(6) of the Act. Financials ofsubsidiaries are disclosed in the consolidated financial statements which forms part ofthis Annual Report. Pursuant to sub-section (3) of section 129 of the Act and Rule 8(1) ofthe Companies (Accounts) Rules 2014 the statement containing the salient feature of thefinancial statements of a Company's subsidiaries in Form AOC-1 is attached to thefinancial statements. Pursuant to the provisions of Section 136 of the Companies Act2013 thefinancial statements of the Company consolidated financial statements along withrelevant documents and separate audited accounts in respect of subsidiaries are availableon the website of the Company.
During theyear under review no company become or ceased to be Company's Subsidiariesjoint ventures or associate companies.
The Board has approved a Policy Statement for determining 'Material' Subsidiaries ofthe Company viz. Acrysil Limited and the same is available on the website ofthe Companyunder'Company Policies' in the'lnvestor Relations section.
The Audit Committee of the Company reviews the financial statements in particular theinvestments made by the unlisted subsidiary company.
The minutes ofthe Board Meetings ofthe unlisted subsidiary companies are placed at theBoard Meeting of the Company.
Further the Annual Accounts and related documents of the subsidiary company shall bekept open for inspection at the Registered Office ofthe Company. The Company will alsomake available copy thereof upon specific request by any Member of the Company interestedin obtaining the same. Further pursuant to Accounting Standard AS-21 issued by theInstitute of Chartered Accountants of India Consolidated Financial Statements presentedby the Company in this Annual Report include the financial information of its subsidiary.
9. Directors and Key Managerial Personnel
The Board of Directors of the Company is led by the Executive Chairman and ManagingDirector and comprises four other Independent Directors as on March312017.
Pursuant to the provisions of Section 152 of the Companies Act 2013 and the ArticlesofAssociation ofthe Company Shri ChiragAshwin Parekh Chairman and Managing Director aredue to retire by rotation at the ensuing Annual General Meeting and being eligible offershimself for re-appointment.
During the year under review the members in their 29th Annual General Meeting held onSeptember 24 2016 approved the appointment of Dr. Sonal Ambani as an Independent Directorwho is not liable to retire by rotation.
Shri Shyam H. Mariwala Smt. Shetal C. Parekh and Mr. Arjun Handa tendered theirresignations from the Board of Directors duringthefinancial year.
Mr. Chirag A. Parekh Chairman and Managing Director Mr. Anand H.Sharma ChiefFinancial Officer and Mr. Damodar Sejpal Company Secretary and Compliance Officer are theKey Managerial Personnel ofthe Company in accordance with the provisions of Section 2(51)and 203 of the Companies Act 2013 read with the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014.
There has been no change in the Key Managerial
Personnel during the financial year 2016-17.
a. Board Meetings
During the year 7 (Seven) Board meetings were held with gap between Meetings notexceeding the period prescribed under the Companies Act 2013. Details of Board and Boardcommittee meetings held during the year are given in the Corporate Governance Report whichforms part of theAnnual Report.
Board meeting dates are finalized in consultation with all directors and agenda papersbacked up by comprehensive notes and detailed background information are circulated wellin advance before the date of the meeting thereby enabling the Board to take informeddecisions. A detailed presentation is also made to apprise the Board of importantdevelopments in industry segments businessoperations marketing products etc.
In accordance with the provisions of Schedule IV of Companies Act 2013 ("theAct") and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015("SEBI LODR Regulations") a separate meeting of the Independent Directors ofthe Company was held on 15th March 2017 to review the performance of Non-IndependentDirectors (including the Chairpersons) and the entire Board. The Independent Directorsalso reviewed the quality quantity and timelines of the flow of information between theManagement and the Board.
b. Independent Director's Familiarization Programme
The Company familiarises its Independent Directors pursuant to the requirements ofRegulation 25 of LODR with their roles rights responsibility in the Company nature ofthe industry in which the Company operates and business model management structureproduct portfolio Industry overview manufacturing operations internal control systemand processes FOREX management risk management framework functioning of variousdivisions HR Management CSR activities etc. The details of such familiarizationprogrammes for Independent Directors are posted on thewebsite of the Company and can beaccessed at http://www.acrysilcorporateinfo.com/public/upload /pdf/9390FamiliarisationProgrammeforlndepen dentdirectors.pdf
c. Evaluation of Board Committeesand Directors
Considering the Performance Evaluation Guidelines which was formulated by theNomination and Remuneration Committee (NRC) the Board and NRC approved the framework forevaluating the performance on an annual basis of the Board its Committees and eachdirector including the Chairman of the Board of Directors In line with the statutoryrequirements enshrined under the Companies Act 2013 and the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board carried out a performance evaluationof itself its Committees and of all individual Directors including Independent Directorsand the Chairman of the Board of Directors based on various parameters relating toattendance roles responsibilities and obligations of the Board effectiveness of itsfunctioning contribution of Directors at meetings and thefunctioningof its Committees.
d. Policy on Appointment and Remuneration of Directors
The Board on the recommendation of the Nomination & Remuneration Committeeformulated criteria for determining Qualifications Positive Attributes and Independenceof a Director and a Policy for remuneration of Directors Key managerial Personnel andsenior management. The Board has formulated Nomination and Remuneration Policy is postedon the website of the Company and can be accessed at http://www.acrysilcorporateinfo.com/pubiic/upioad/pdf/14962328Nomination%20&%20 Remuneration%20Poiicy. pdf.
e. Declaration by independent Directors
The Independent Directors of the Company have furnished the declaration to the Companyunder Section 149(7) of the Companies Act 2013 that he/ she meets the criteria ofindependence prescribed under Section 149(6) of the Companies Act 2013 and Regulation 25of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
a. Statutory Auditors
M/s. Sanghavi and Co. Chartered Accountants Bhavnagar whose term of office as theAuditors of the Company will expire at the conclusion of the ensuing Annual GeneralMeeting of the Company have given to the Company a notice in writing of their inability tobe re-appointed. M/s. P ARK& Company Chartered Accountants Bhavnagar who have givena letter to the Company giving consent for their proposed appointment as Auditors and havegiven a Certificate stating that their proposed appointment shall be in accordance withthe provisions of Sections 139(1) and 141 of the Companies Act 2013 are proposed to beappointed as the Auditors of the Company for a term of Five years till the conclusion ofthe Thirty Fifth Annual General Meeting in place of M/s. Sanghvi & Co. the retiringAuditors of the Company.
The Board has duly reviewed the Statutory Auditor's Report and the observations andcomments appearing in the report are selfexplanatory and do not call for any furtherexplanation /clarification by the Board of Directors as provided undersection 134oftheAct.
Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit)Amendment Rules 2014 the cost audit records maintained by the Company in respect of itsKitchen Sinks under other manufacturing activity are required to be audited byCostAuditors.
The Board of Directors on recommendation of Audit Committee has appointed M/s.S. K.Rajani & Co. Cost Accountants (FRN: 101113) as Cost Auditors of the Company for thefinancial year 2017-18 on a remuneration ofRs 60000/- subject to ratification by members.
A resolution seeking ratification for the remuneration payable to Cost Auditors formspart of the Noticeof 30th Annual General Meeting ofthe Company and same isrecommended for your consideration and ratification.
The Company has filed the Cost Audit Report with the Ministry of Corporate Affairswithin the stipulated time period prescribed under the Companies (Cost Record and Audit)Rules 2014.
c. Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. P. P. Shah &Co. a firm of Company Secretaries in Practice to conductthe Secretarial Audit ofthe Company. The secretarial audit report for the financial year2016-17 forms part ofthe Annual Report as Annexure IVto the Board's report. TheSecretarial Audit Report is self-explanatory in
nature and do not require any further comments and explanations.
The Board has appointed M/s. P. P. Shah & Co. Practicing Company Secretaries assecretarial auditoroftheCompanyforfinancialyear2017-18.
d. Auditors'Certificate on Corporate Governance
As required by SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the auditors' certificate on corporate governance is form part of Annual Report. Theauditors' certificate for financial year 2016-17 does not contain any qualificationreservation or adverse remark.
11. Internal Control System and Compliance Framework
In the opinion of the Board the Company has an Internal Control System commensuratewith size scale and complexity of its operations. The internal financial controls areadequate and are operating effectively so as to ensure orderly and efficient conduct ofbusiness operations.
The Audit Committee in consultation with the internal auditors formulates the scopefunctioning periodicity and methodology for conducting the internal audit. The internalauditors carry out audit covering inter alia monitoring and evaluating the efficacy andadequacy of internal control systems in the Company its compliance with operatingsystems accounting procedures and policies at all locations and submit their periodicalinternal audit reports to the Audit Committee. Based on the internal audit report andreview by the Audit committee process owners undertake necessary actions in theirrespective areas. The internal auditors have expressed that the internal control system inthe Company is robust and effective.
During the year Internal Financial Controls (IFC) testing process was done in order toreview adequacy and strength of IFC followed by the Company. As per the assessment thereare no major concerns and controls are strong.
The Board has also put in place requisite legal compliance framework to ensurecompliance of all the applicable laws and those systems are adequate and operatingeffectively.
12. Audit Committee
The Company has an Audit Committee pursuant to the requirements of the Act read withthe rules framed thereunder and SEBI LODR. The details
relating to the same are given in the Report on Corporate Governance forming part ofthis Report. During the Financial year 2016-17 the recommendations of Audit Committeewere duly approved and accepted bythe Board of Directors.
13. The Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013.
The Company has in place a Policy on Prevention of Sexual Harassment at Workplace inline with the requirements of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and Rules framed thereunder and the Company hasinstituted a Complaints Committee for redressal of sexual harassment complaint (made bythe victim) and for ensuring time bound treatment of such complaints.
During the year no complaint was lodged with the Complaints Committee.
14. RiskManagementandPolicyonRisk Management
Acrysil understands controlling risks and has implemented an integrated risk managementapproach through which it reviews and assesses significant risks on a regular basis tohelp ensure that there is a robust system of risk controls and mitigation in place. Seniormanagement periodically reviews this risk management framework to keep updated and addressemerging challenges.
Major risks identified for the Company by the management are Currency fluctuationCompliance Regulatory changes Manufacturing & Supply Litigation InformationTechnology and new capital investments return. The management is however of the view thatnone of the above risks may threaten the existence of the Company as robust Riskmitigation mechanism is put in place to ensure that there is nil or minimum impact on theCompany in case any of these risks materialise.
The Board of Directors has also adopted a formal Risk Management policyforthe Companywhereby risks are broadly categorized with the parameters of identification assessmentmonitoring and mitigation of various risks. Policy on Risk Management is posted on thewebsite of the Company and can be accessed athttp://www.acrysilcorporateinfo.com/public/upload/pd f/1902risk-management-poiicy. pdf
15. Vigil Mechanism
The Company has adopted the whistle blower mechanism for directors and employees toreport concerns about unethical behavior actual or suspected fraud or violation of theCompany's code of conduct and ethics if any in the Company noticed by them. It is postedon the intranet of the Company. The same is reviewed by the Audit Committee fromtimetotime.
16. Related Party Transactions and Policy on Related Party Transactions
The Related Party Transactions (RPTs) were entered in ordinary course of business on anarm's length basis and were in compliance with the provisions of the Companies Act 2013and the SEBI Regulation. The statement of RPTs is placed before the Audit Committee andthe Board on a quarterly basis. Omnibus approval was obtained for the transactions ofrepetitive nature. The Policy on Materiality of Related Party Transactions and dealingwith Related Party Transactions as approved by the Board is uploaded on the Company'swebsite at http://www.acrysilcorporateinfo.com/public/upload/pdf/5203related-party-transcation-policy.pdf There are no materially significant relatedparty transactions made by the Company with Promoters Directors Key Managerial Personnelor other designated persons which may have a potential conflict with the interest of theCompany at large. Accordingly particulars of contracts or arrangements with relatedparties referred to in sub-section (1) of section 188 of the Companies Act 2013 at arm'slength transactions under third proviso thereto are disclosed in Form No. AOC-2 inAnnexure- II and form part of this Report.
None of the Non-Executive Directors has any pecuniary relationship or transactions withthe Company other than sitting fees and commission payabletothem.
17. Managerial Remuneration and Particulars of Employees
The ratio of remuneration of each director to the median of employees' remuneration asper Section 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of theBoard's report and statement of particulars of employees is annexed as Annexure IV.
The Company takes a very pragmatic approach towards insurance. Adequate cover has beentaken for all movable and immovable assets against foreseeable perils like fire riotearthquake floods terrorism etc. and other risks which are considered necessary by themanagement.
In addition to this coverage a statutory Public Liability Insurance Policy has beentaken to cover the company for providing against the Public liability arising out ofIndustrial accidents for employees working in plants.
19. Loans Guarantees or Investments
The Details of Loans given Guarantees and Securities provided and Investments made bythe Company in compliance with the provisions of Section 186 of the Companies Act 2013are given in the notes to the Financial Statements.
20. Corporate Social Responsibility (CSR)
In accordance with the provisions of Section 135 of the Companies Act 2013 and Rulesframed thereunder your Company has adopted a policy for CSR and the Board has constituteda Committee for implementing the CSR activities. Composition of the Committee and otherdetails are provided in Corporate Governance Report.
The Company has implemented various CSR projects directly and/orthroughimplementingagencyand the projects undertaken by the Company are in accordance withSchedule VII of the Companies Act 2013. The report on CSR activities as required underthe Companies (Corporate Social Responsibility Policy) Rules 2014 is given in"Annexure III" forming part of this report.
The Company has not accepted any fixed deposits from the public falling within theambit of Section 73 of the Companies Act 2013 and The Companies (Acceptance of Deposits)Rules 2014 during the year. There are no unclaimed deposits as on March 31 2017.
22. ExtractoftheAnnual Return
In accordance with the provisions of section 92(3)(a) of the Act read with Rule 12 ofthe Companies (Management and Administration) Rules 2014 (as amended) an extract of theAnnual Return is annexed to this report as Annexure-I.
23. Directors'Responsibility Statement
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors confirm:
a. that in the preparation of the annual accounts for the year ended March 31 2017the applicable Accounting Standards had been followed along with proper explanationrelating to material departures if any;
b. that the directors had selected 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 endedMarch 31 2017 and of the profit of the Company forthat period;
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 andotherirregularities;
d. that the annual accounts/financial statements have been prepared on a goingconcernbasis;
e. that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;
f. that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
24. Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
The information relating to Conservation of energy technology absorption foreignexchange earnings and outgo as required to be given under Section 134 of the Act readwith Rule 8(3) of the Companies (Accounts) Rules 2014 is furnished in Annexure VI andforms part of this report.
25. Corporate Governance
Your Company is committed to maintain the highest standards of Corporate Governancereinforcing the valuable relationship between the Company and its Stakeholders.
As per requirements of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 parameters of Statutory compliances evidencing the standards expectedfrom a listed entity have been duly observed and a Report on Corporate Governance as wellas the Certificate from Statutory Auditorsforms part of the Annual Report.
26. Human Resource
Your Company firmly believes that employees are the most valuable assets and keyplayers of business success and sustained growth. At Acrysil the Human Resource functionis a business partnerthat focusses on improving the way of life work culture employeeengagement productivity effectiveness and efficiency. The Company believes in developingan engaged efficient and committed employee base that is aware and empowered.
Various employee benefits recreational and team building programs are conducted toenhance employee skills motivation as also to foster team spirit. Company also conductsin-house training programs to develop leadership as well as technical / functionalcapabilities in order to meet future talent requirements. Industrial relations werecordial throughouttheyear.
27. Disclosures under Section 134(3)(l) of the Companies Act 2013
Except as disclosed elsewhere in this report there have been no material changes andcommitments which can affect the financial position of the Company occurred between theend of the financial year of the Company and date of this report.
28. Transfer to Investor Education and Protection Fund
Pursuant to the provisions of Section 205A of the Companies Act 1956 (Section 124 ofthe Companies Act 2013) your company has transferred Rs 384896/- during the year tothe Investor Education and Protection Fund. This amount was lying unclaimed/ unpaid withthe Company for a period of seven years after declaration of Dividend for the financialyear ended 2008-09.
Here belowarethe proposed dates for transfer of the unpaid dividend to IEPF by theCompany.
|Financial Year ||Date of declaration ||Proposed date for transfer to IEPF* |
|2009-10 ||10.08.2010 ||30.08.2017 |
|2010-11 ||12.08.2011 ||30.08.2018 |
|2011-12 ||15.09.2012 ||25.09.2019 |
|2012-13 ||26.09.2013 ||10.10.2020 |
|2013-14 ||24.09.2014 ||13.10.2021 |
|2014-15 ||25.09.2015 ||14.10.2022 |
|2015-16 ||24.09.2016 ||13.10.2023 |
* Indicative dates actual dates mayvary.
Gratitude & Acknowledgments
It is our strong belief that caring for our business constituents has ensured oursuccess inthe past andwilldosoin future. The Board acknowledges with gratitude theco-operation and assistance provided to your company by Bankers Investors CustomersSuppliers and Government Authorities. The Board place on record earnest appreciation forthe unstinted commitment dedication hard work and significant contribution made byemployees ensuring sustained growth of the Company.
The Board also takes this opportunity to express its deep gratitude for the continuedco-operation and support received from itsvalued shareholders.
|Mumbai May 25 2017 ||By order of the Board of Directors |
|Registered Office: || |
|B-307 Citi PointJ. B. Nagar Andheri Kurla Road ||ChiragA. Parekh |
|Andheri (East). Mumbai - 400 059. ||(DIN: 00298807) |
|Tel: (91-22) 4015 7817/ 7818/7819 ||Chairman & Managing Director |
|Fax: (91-22) 2825 8052. || |
|CIN: L26914MH1987PLC042283 || |
|Website: www.acrysil.com/www.acrysilcorporateinfo.com || |