THE MEMBERS OF
ARCHIDPLY INDUSTRIES LIMITED
Your Directors are pleased to present the Twenty fourth Annual Report together with theAudited Statement of Accounts for the year ended 31st March 2019.
The financial results of the Company during the year under review are summarized asunder:
| || ||(Rs. In Lakhs) |
|Particulars ||Year ended 31.03.19 ||Year ended 31.03.18 |
|Revenue from Operations ||33042.23 ||30872.29 |
|Other Income ||156.81 ||293.93 |
|Total Income ||33199.04 ||31166.22 |
|Profit Before Financial expenses & Depreciation ||2133.49 ||1904.99 |
|Less: Depreciation & Amortization Expenses ||641.15 ||522.86 |
|Less: Finance Costs ||983.47 ||998.68 |
|Profit before tax ||508.87 ||383.45 |
|Taxation ||62.57 ||132.56 |
|Profit after tax ||446.30 ||250.89 |
|Other Comprehensive Income ||(0.85) ||(4.71) |
|Total Comprehensive Income ||445.45 ||246.18 |
The highlights of the Company's standalone performance are as under:
The Total Income of the Company during the year under review increased by 6.52%from Rs. 31166.22 lakhs to Rs.33199.04 lakhs.
The Profit Before Tax (PBT) increased by 32.71% from Rs. 383.45 lakhs in theprevious year to Rs. 508.87 Lakh.
Profit after tax (PAT) increased by 77.89% from Rs. 250.89 lakhs in the previousyear to Rs. 446.30 Lakh.
DEMERGER OF THE COMPANY
The petition for approval of scheme of arrangement for Demerger of Chintamani Unit ofthe Company into Archidply Decor Limited has been filed with the National Company LawTribunal Allahabad and the matter is under consideration.
The detailed scheme of Demerger is available on the website of the Companywww.archidply.com.
Keeping in view to further improve the capacity utilization and consolidate itsexisting facilities the Board has considered prudent to conserve and retain the profitfor further improvement. The Board regrets its inability to recommend any dividend.
The paid up equity capital as on March 31 2019 was ' 2206.50 Lakhs. The Companyhas not issued shares with differential voting rights nor granted stock options nor sweatequity during the year.
Cash and cash equivalents and bank balances as at March 31 2019 was ' 1052.58 lakhs.The company continues to focus on judicious management of its working capitalReceivables inventories and other working capital parameters were kept under strict checkthrough continuous monitoring.
During the financial year under review the company did not accept any deposits coveredunder chapter V of the Companies Act 2013 and Section 73 of the Companies Act 2013 andthe Companies (Acceptance of Deposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
There were no Loans Guarantees and Investments covered under Section 186 of theCompanies Act 2013.
The details of the investments made by company is given in the notes to the financialstatements.
MATERIAL CHANGE AND COMMITMENT
There have been no material changes and commitments affecting the financial position ofthe Company between the close of the year till the date of this report. There has been nochange which affect the financial position of the Company.
As such there is no significant and material order by the regulator/court/tribunal/impacting the going concern status and the Company operation in future.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
Internal Financial Controls are an integrated part of the risk management processaddressing financial and financial reporting risks. The internal financial controls havebeen embedded in the business processes and continuous monitoring of the internalfinancial control systems by the internal auditors during the course of their audits. Webelieve that these systems provide reasonable assurance that our internal financialcontrols are designed effectively and are operating as intended. To maintain itsobjectivity and independence the Internal Audit function reports to the Chairman of theAudit Committee of the Board & to the Chairman & Managing Director.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
During the year the company has spent Rs.1481452 towards corporate socialresponsibility (CSR) under Section 135 of the Companies Act 2013 and rules thereon by wayof contribution to schools for their development orphanage and children welfare. TheCompany has spent the last year kept aside amount of Rs.170000 for CSR in the currentfinancial year 2018-19
Details about the CSR policy is available on our website http://www.archidply.com/.
The annual report on our CSR activities is appended as Annexure A to the Board'sreport.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided inAnnexure "C" to this Report.
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
DIRECTORS & KEY MANAGERIAL PERSON:
Mr. Deendayal Daga Wholetime Director of the Company retire at this AGM being eligiblefor appointment offer himself for the re- appointment at this AGM.
Mr. Mohammed Shahid Aftab (DIN 01363518) and Mr. Bharath Kumar Hukumchand Rathi (DIN01857860) were reappointed as an for a second term of Five consecutive years commencingfrom April 12019 up to March 312024 not liable to retire by rotation.
None of the Directors of your Company is disqualified as per provisions of Section164(2) of the Companies Act 2013. The Directors of the Company have made necessarydisclosures as required under various provisions of the Companies Act.
All independent directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and as per therequirement of SEBI (LODR) Regulation 2015.
CORPORATE GOVERNANCE REPORT:
Our corporate governance report for FY 2018-19 forms part of this Annual Report. Therequisite certificate from the auditors of the Company confirming compliance with theconditions of corporate governance as stipulated under SEBI LODR is annexed to thecorporate governance report.
The Company has laid down a process for evaluation of the Board and Committees of Boardas also evaluation of the performance of each of the Directors. The evaluation isconducted and monitored by the Chairperson Nomination & Remuneration Committee (NRC)in consultation with the members of the committee. Each of the Directors are given aself-assessment Questionnaire covering degree of fulfillment of their responsibilitiesBoard structure and composition Responsibilities of Committee effectiveness of the Boardprocess information and functioning Board culture and dynamics quality of relationshipbetween the Board and Management etc.
The evaluation process inter alia considers attendance of Directors at Board andcommittee meetings acquaintance with business communicating inter se board memberseffective participation domain knowledge compliance with code of conduct vision andstrategy benchmarks established by global peers etc. which is incompliance withapplicable laws regulations and guidelines.
The Board carried out annual performance evaluation of the Board Board Committees andIndividual Directors and Chairperson. The Chairman of the respective Board Committeesshared the report on evaluation with the respective Committee members. The performance ofeach Committee was evaluated by the Board based on report on evaluation received fromrespective Board Committees.
The reports on performance evaluation of the Individual Directors were reviewed by theChairman of the Board.
The board met four times during the financial year the details of which are given inthe corporate governance report. The maximum interval between any two meetings did notexceed 120 days as prescribed in the Companies Act 2013.
DIRECTOR'S RESPONSIBILITY STATEMENT:
Based on the framework of internal financial controls established and maintained by theCompany work performed by the internal statutory and secretarial auditors and reviewsperformed by Management in concurrence with the Audit Committee the Board is of theopinion that the Company's internal financial controls were adequate and effective duringthe financial year 2018-19.
In Compliance with section 134(5) of the Companies Act 2013 the Board of Directors tothe best of their knowledge and hereby confirm the following:
(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 sufficient 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 operating effectively.
(f) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions that were entered during the financial year were on anarm's length basis and in the ordinary course of business and is in compliance with theapplicable provisions of the Act and the Listing Regulations. There were no materiallysignificant Related Party Transactions made by the Company during the year that requiredshareholders' approval under Regulation 23 of the Listing Regulations. None of thetransactions entered with related parties falls under the scope of Section 188(1) of theAct. Details of transactions with related parties as required under Section 134(3) (h) ofthe Act read with Rule 8(2) of the Companies (Accounts) Rules 2014 are provided inAnnexure F in Form AOC-2 and forms part of this Report.
The policy on Related Party Transactions as approved by the Board has been uploaded onthe Company's website www.archidply.com.There are no materially significant related partytransactions that may have potential conflict with interest of the Company at large.
The Company does not have any subsidiary company.
The details of the faimiliarisation programme undertaken have been provided in theCorporate Governance Report.
EXTRACT OF THE ANNUAL RETURN
In accordance with section 134(3) (a) of the Companies Act 2013 an extract of theannual return in the prescribed format is enclosed herewith as Annexure "E" tothe Board's report.
CODE OF CONDUCT:
The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehavior from an employee in a given situation and the reporting structure.
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code.
Your Company has established a "Vigil Mechanism" for its employees andDirectors enabling them to report any concerns of unethical behavior suspected fraud orviolation of the Company's 'Code of Conduct'. To this effect the Board has adopted a'Whistle Blower Policy' which is overseen by the Audit Committee. The policy providessafeguards against victimization of the Whistle Blower. Employees and other stakeholdershave direct access to the Chairperson of the Audit Committee for lodging concerns if anyfor review
At the Annual General Meeting held on 12th September 2017 M/s Priti Jhawar & Co.Chartered Accountants (ICAI Firm Reg. No. 328818E ) were appointed as the StatutoryAuditors of the Company for a period of 5 years up to the conclusion of 27th AnnualGeneral Meeting to be held in 2022.
STATUTORY AUDITOR'S REPORT
The Auditors Report to the Shareholder does not contain any reservation Qualificationor adverse remark. 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.
SECRETARIAL AUDIT REPORT
The Board appointed Mr. Deepak Sadhu Practicing Company Secretary to conductSecretarial Audit for the FY 2018-19. The Secretarial Audit Report for the financial yearended March 31 2019 is annexed herewith marked as Annexure D to this Report. TheSecretarial Audit Report does not contain any qualification reservation adverse remarkor disclaimer except as per regulation 13(3) of SEBI LODR the Company had filed investorcomplaints for the last quarter Jan - Mar 2019 on 09th May 2019 with BSE a delay of 18days on BSE where the due date as per this regulation is 21 days from the end of thequarter. To this effect the BSE levied a fine of Rs.18880-00 on the Listed Entity fordelay in filing and the company in response to this paid the fine of Rs.18880-00 and theCompany did the compliance on 09th May 2019. However the company has filed the statementof investor complaints on time with NSE and the same was also posted on time on thewebsite of the Company.
BUSINESS RISK MANAGEMENT
Your Company has an elaborate Risk Management Framework which is designed to enablerisks to be identified assessed and mitigated appropriately. On the basis of riskassessment criteria of the Company has been entrusted with the responsibility to assistthe Board in
(a) Overseeing and approving the Company's enterprise wide risk management framework;and
(b) Overseeing that all the risks that the organization faces such as financialcredit market liquidity security property IT legal regulatory reputational andother risks have been identified and assessed and there is an adequate risk managementinfrastructure in place capable of addressing those risks.
The Audit Committee of the Board evaluating risks management policy of the Company onquarterly basis. A risk management policy is available on our website http://www.archidply.com
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("Listing Regulations") is presented in aseparate section forming part of the Annual Report.
PARTICULARS OF EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014. Particulars of employees remunerationas required under section 197(12) of the Companies Act 2013 read with Rule 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 formsa part of this report. Considering first proviso to Section 136(1) of the Companies Act2013 the Annual Report excluding the said information was sent to the members of theCompany and others entitled thereto. The said information is available for inspection atthe registered office of the Company during working hours up to the date of ensuing annualgeneral meeting. Any member interested in obtaining such information may write to theCompany Secretary in this regard.
EQUAL OPPORTUNITY & PREVENTION OF SEXUAL HARRASMENT
The Company has always provided a congenial atmosphere for work to all employees thatis free from discrimination of any kind. It has provided equal opportunities of employmentto all without regard to the nationality religion caste colour language maritalstatus and sex.
The Company has also framed policy on 'Prevention of Sexual Harassment' at theworkplace. We follow a gender-neutral approach in handling complaints of sexual harassmentand we are compliant with the law of the land wherever we operate. There was no complaintrelated to sexual harassment during the Year 2018
COMMITTEES OF THE BOARD
Currently the board has four Committees: the Audit Committee the Nomination andRemuneration Committee the Corporate Social Responsibility Committee and the StakeholdersRelationship Committee. The majority of the members of these committees are Independentand non-executives.
A detailed note on the composition of the board and other committees is provided in thecorporate governance report section of this annual report.
CEO AND CFO CERTIFICATION
Pursuant to the Listing Regulations the CEO and CFO certification is attached with theAnnual Report. The Managing Director &CEO and the Chief Financial Officer also providequarterly certification on financial results while placing the financial results beforethe Board in terms of the Listing Regulations.
The Equity shares of the Company are listed with Bombay Stock Exchange Ltd. (BSE) &National Stock exchange of India Limited (NSE). The annual listing fee for the year2019-20 was paid within the scheduled time to BSE & NSE.
The Board of Directors would like to express their sincere appreciation for theassistance and cooperation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Boards ofDirectors also wish to place on record its deep sense of appreciation for the committedservices by the Company's executives staff and workers.
| ||For and on behalf of the Board of Directors |
| ||Deen Dayal Daga |
|Place: Bengaluru ||(Chairman) |
|Date: 16 May 2019 || |