Your Directors are pleased to present this Thirty First Annual Report together with theAudited Statement of Accounts of the Company for the year ended on 31st March2020.
As per the notification issued by the Ministry of Corporate Affairs dated 16thFebruary 2015 relating to the Companies (Indian Accounting Standards) Rules 2015 theCompany has adopted Ind AS with effect from 1st April 2017.Accordingly the Financial Statement for the year 2019-20 has been prepared in compliancewith the Companies (Indian Accounting Standard) Rules 2015.
|Financial Performance || || |
| || ||(Amount in Rupees in Lakhs) |
| ||31.03.2020 ||31.03.2019 |
|Revenue from operations ||4716.75 ||4071.93 |
|Profit before Depreciation ||1004.57 ||1004.57 |
|Less: Finance Cost ||312.84 ||254.31 |
|Depreciation & Amortisation Expenses ||485.08 ||401.90 |
|Profit before Tax ||144.54 ||348.36 |
|Tax Expenses- Current Taxation ||24.30 ||75.00 |
|Deferred Tax ||33.25 ||18.06 |
|Add/(Less): || || |
|(Excess)/Short Provision of tax of earlier years || ||3.09 |
|Profit for the year ||86.99 ||252.21 |
|Other comprehensive Income || || |
|Items that will not be reclassified to profit or loss || || |
|Gain/(Loss) on measurement of Equity Share instruments at fair value ||0.00 ||(1.64) |
|Income tax impact on above ||0.00 ||0.00 |
|Other comprehensive Income for the year ||0.00 ||(1.44) |
|Total comprehensive Income for the year ||86.99 ||250.57 |
Your Company continued to report satisfactory performance during the year under review.The revenue from operations (net) stood at Rs.4716.75 i.e. an increase of 15.84% over theprevious year's revenue. The Company continued to explore overseas market opportunitiesand the exports amounted to Rs.333 lakhs i.e. increase of 60% over the previous year'sexports. There was heavy fluctuation in foreign exchange rates resulting into a gain ofRs.4.20 lakhs. The profit on sale of assets amounted to 3.70 lakhs. The bad debtsamounting to Rs.18.07 lakhs were written off during the year as against bad debts of Rs.Rs.4.17 lakhs written off during the previous year. The raw material prices fuel chargesfinance cost and other overheads were continued to increase during the year.
The Company has earned lower profit of Rs.144.54 lakhs as against profit of Rs.348.36lakhs earned before taxes during the previous year. Your Directors hope better results inthe years to come.
IMPACT OF COVID-19
The World Health Organization (WHO) declared COVID-19 a global pandemic. Consequent tothis Government of India declared nation-wide lockdown on March 24 2020 which hasimpacted normal business operations of the Company. The Company has assessed the impact ofthis pandemic on its business operations and has considered all relevant internal andexternal information available up to the date of approval of these financial results todetermine the impact on the Company's revenue from operations for foreseeable future andthe recoverability and carrying value of certain assets such as property plant andequipment investments inventories trade receivables and MAT credit. The impact ofCOVID-19 pandemic on the overall economic environment being uncertain may affect theunderlying assumptions and estimates used to prepare Company's financial results whichmay differ from that considered as at the date of approval of the financials results. Asthe situation is unprecedented while the lockdown is gradually lifting the Company isclosely monitoring the situation as it evolves in the future. The Company has resumed itsbusiness activities in line with guideline issued by the Government authorities. TheCompany does not anticipate any challenges in its ability to continue as going concern ormeeting its financial obligations.
Your Directors do not recommend dividend for the year under review in view of lowerprofits and financing activities on hand. Your Directors also do not propose any amount tocarry to the general reserves.
Your Company continued to avail financial assistance amounting to finance its presentand proposed projects on hand.
The Company has not accepted any deposit within the meaning of the provisions ofSection 2(31) and 73 to 76 of the Companies Act 2013 read with the Companies (Acceptanceof Deposits) Rules 2014.
All the assets of the Company including buildings plant and machineries and stocks areadequately insured.
DIRECTORS/REAPPOINTMENT OF KMPs
(1) Shri Neel Dinesh Bilgi (DIN00096180) Managing Director and (2) Shri LaxmanChetandas Tilani (DIN00532516) Directors of the Company are due to retire at the ensuingAnnual General Meeting and being eligible offer themselves for re-appointments. The Boardhereby re-commends their reappointments.
Tenure of Key Managerial Personnel namely (1) Shri Dinesh Apparao Bilgi (DIN00096099)Managing Director/CFO (2) Shri Neel Dinesh Bilgi (DIN00096180) Managing Director and (3)Shri Chirag Dinesh Bilgi (DIN02094970) Managing Director of the Company expired on 31stJuly 2020; and tenure of Shri Pragnesh Kantilal Shah (DIN00228233) Executive Director ofthe Company shall expire on 31st October 2020. The Nomination &Remuneration Committee and the Board of Directors in their meetings held on 26thJune 2020 considered the contribution and devotion of time with valuable and effectiveparticipation by all the key managerial personnel in their respective areas for the growthof the Company and; recommended/approved their re-appointments respectively subjecthowever to the approvals by the members of the Company in their ensuing Annual GeneralMeeting. The Board hereby re-commends their re-appointments.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Company review the composition of theBoard to ensure that there is an approximate mix of abilities expertise experience anddiversity to serve the interest of the shareholders of the Company. The Policy ensuresthat (1) the level and composition of remuneration is reasonable and sufficient toattract retain and motivate directors of the quality required to run the Company (2)relationship of remuneration to performance is clear and meets appropriate performancebenchmarks and (3) remuneration to directors key managerial personnel and seniormanagement involves a balance between fixed and incentive pay reflecting short and longterm performance objectives appropriate to the working of the company.
As per the provisions of Section 149 of the Companies Act 2013 the IndependentDirectors have confirmed and declared that they are not disqualified to act as independentdirectors and the Board is also of the opinion that the Independent Directors fulfill allthe conditions specified in the Companies Act 2013 making them eligible to act asIndependent Directors.
Two separate meeting of the Independent Directors were held on 23.04.2019 and13.03.2020. The Independent Directors actively participated and provided guidance to theCompany. The Independent Directors reviewed the performance of the non-IndependentDirectors and the Board as a whole.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY
No material changes and commitments affecting the financial position of the Companyoccurred between the end of the financial year to which the financial statements relateand the date of this Report except impact of COVID-19 pandemic conditions followed bylockdowns even during the current year.
Pursuant to the provisions of Section 134 of the Companies Act 2013 a structuredquestionnaire was prepared after taking into account various aspects like- companyperformance contribution of individual directors composition of Board and committeesperformance of duties culture obligations corporate ethics risk management etc. forevaluation process. The Board noted that all directors have understood the opportunitiesand risks to the Company's strategy with good balance between the core values of theCompany and the interest of the stakeholders. The Board also evaluated performance of thevarious committees and concluded with satisfaction. The Board expressed their satisfactionfor the above evaluation process.
PARTICULARS OF EMPLOYEES
There was no employee covered under the purview of Section 134(3)(q) of the CompaniesAct 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.
Information required under the provisions of Section 197(12) of the Companies Act 2013read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is given by way of an Annexure `F' to this Report.
CHANGES IN NATURE OF BUSINESS
There is no change in the nature of business of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134(3)(c) of the Companies Act 2013 theDirectors hereby state that:
(i) in the preparation of annual accounts for the financial year ended 31stMarch 2020 the applicable accounting standards have been followed along with properexplanation relating to material departures;
(ii) the directors have 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 31st March 2020 and ofthe profits of the Company for the year ended on that date;
(iii) the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(iv) the directors have prepared the annual accounts on a going concern basis.
(v) the directors had laid down internal controls to be followed and such internalcontrols are adequate and were operating effectively.
(vi) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
ORDERS BY REGULATORS COURTS OR TRIBUNALS
No significant and/or material orders were passed by any Regulator Court or Tribunalimpacting the going concern status and the Company's operations in future.
Code of Conduct
All Directors Key Managerial Personnel and Senior Management of the Company haveconfirmed compliance with the code of conduct applicable to the Directors and employees ofthe Company. The Directors have confirmed compliance with the provisions of Section 164 ofthe Companies Act 2013.
Risk Management Policy
The Company has already formulated risk management policy so as to identify evaluatemonitor and minimize identifiable business risks in the organization.
Vigil Mechanism/Whistle Blower Policy
The Company has already adopted Whistle Blower Policy to report genuine concerns orgrievances and to safeguard victimization of persons while using this mechanization.
Company's Policies on Remuneration Materiality of Related Party Transactions Boarddiversity Preservation of documents Corporate Social Responsibility (CSR) are finalizedin accordance with applicable laws.
The Company has voluntarily donated Rs.1 Lakhs to Harekrishna Movement Rs. 9 Lakhs toShree Hombuja Padmavati Education Trust Rs.0.20 Lakhs to Lions Club of Kalol Rs.15 Lakhsto Gunayatan for charitable activities during the year.
INTERNAL FINANCIAL CONTROLS
The Company has a proper adequate and effective internal control system to ensure thatall the assets are safeguarded and protected against loss from unauthorized use ordisposition and those transactions are authorized recorded and reported correctly.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION ADAPTATION AND INNOVATION
The Company has been taking steps for optimum utilisation of power and fuel. Theinformation as required under Section 134(3)(m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 is given by way of Annexure `A' forming part of thisReport.
EXTRACT OF ANNUAL RETURN
As required under the provisions of Section 92(3) of the Companies Act 2013 anextract of Annual Return in Form MGT-9 is given by way of an Annexure `D' forming part ofthis Report.
Shri Dinesh A Bilgi (DIN00096099) Managing Director and CFO has given necessarycertificates/compliance reports to the Company.
As required under the provisions of Section 204 of the Companies Act 2013 and theRules made thereunder a Secretarial Audit Report is given by way of an Annexure `B'forming part of this Report. The Auditors observations are self explanatory.
M/s Sweta Patel & Associates Chartered Accountants of Ahmedabad having FirmRegistration No.139165W were appointed as Statutory Auditors of the Company for a periodof five years by the members of the Company in their 28th Annual GeneralMeeting (AGM) held on 21st September 2017. This appointment was subject to theratification at every subsequent AGM held thereafter. However in view of the amendedprovisions of Section 139 such ratification is not required with effect from 7thMay 2018. The said Auditors have submitted their willingness to continue to act asStatutory Auditors of the Company and certificate to the effect that they are eligible forsuch appointment and are not disqualified to act as such. The remuneration shall bedetermined by the Board of Directors upon recommendation by the Audit Committee andmutually agreed upon by the said Auditors.
The Auditors observations read with the notes to the Accounts for the year ended on 31stMarch 2020 are self-explanatory.
MANAGEMENT DISCUSSION AND ANALYSIS (MD&A) & CORPORATE GOVERNANCE
The Company's philosophy is based on trusteeship transparency and accountability. Itfosters a culture of ethical behaviour and disclosures which build a trust of ourstakeholders. The Code of Conduct ethics and Code of Conduct for Prevention of InsiderTrading are an extension of our values and reflect our commitment to ethical businesspractices integrity and compliances of both voluntary and statutory requirements. Adetailed note on Management Discussion and Analysis is given as an Annexure `C' to thisReport.
CORPORATE GOVERNANCE REPORT
As per Regulation 34(3) read with Schedule V of the Listing Regulations a separatesection with detailed note on corporate governance practices followed by the Company isgiven by way of an Annexure `E' forms an integral part of this Report.
LISTING WITH BSE LTD
The Equity Shares of the Company are listed at the BSE Ltd Mumbai under Stock Code No.526851 and ISIN No. is INE480H01011.
The Company has paid Annual Listing fees for the year 2020-21. The Company has alsopaid custodial charges to National Securities Depository Ltd and Central DepositoryServices (India) Ltd for the year 2020-21.
REGISTRAR AND SHARE TRANSFER AGENT (RTA)
M/s Link Intime India Pvt Ltd Mumbai is the RTA of the Company to carry out the sharetransfers transmission dividend and other related activities.
RELATED PARTY TRANSACTIONS
All the transactions entered with related party during the year under review were onarm's length basis and in the ordinary course of business and approved by the AuditCommittee. Hence these transactions are outside the purview of the provisions of Section188 of the Companies Act 2013. However details of such transactions i.e. purchaseslease services etc. are given in the Notes to the Financial Statements for the yearended on 31st March 2020 and therefore details in Form AOC-2 are not given.
LOANS GUARANTEES AND INVESTMENT
The Company has not granted any inter-corporate loan given guarantee or provided anysecurity for availing loan by other Company nor made any investments during the financialyear under review.
ENVIRONMENT AND SAFETY
The Company considers clean and safe mode of operations in all respects. Further asrequired under the provisions of Sexual Harassment (Prevention Prohibition and Redressal)Act 2013 the Company has formulated and implemented a policy on prevention of sexualharassment at workplace. There is no such complaint lodged during the year.
The Board of Directors of the Company appreciates continuous & comprehensivesupport and cooperation by the Company's bankers shareholders customers suppliers andother business associates.
Your Directors place on record their deep appreciation for contribution and devotedservices of the employees at all levels.