TO THE SHAREHOLDERS
Your Directors have pleasure in presenting the Tenth (10th) Directors Report ofyour Company along with the financial statements for the financial year ended 31 st March2017.
1. OPERATinG RESULTS
Certain key aspects of your Companys performance during the financial year ended31st March 2017 as compared to the previous financial year are summarized below:
(Rs in 000)
|Particulars ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 |
|Income for the year ||485344.30 ||505777.60 |
|Profit before Interest Depreciation and Tax ||97202.88 ||135256.67 |
|Finance Charges ||6792.66 ||12437.98 |
|Profit before Depreciation and Taxes ||90410.22 ||122818.69 |
|Depreciation & Amortisation ||39256.99 ||41991.74 |
|Provisions for Taxation/ Deferred Tax ||16642.81 ||27691.14 |
|Prior Period Items / Exceptional Items ||Nil ||Nil |
|Minority Interest & Profit from Associate Company ||Nil ||Nil |
|Net Profit for the Current Year ||34510.42 ||53135.81 |
|Earlier Years Balance Brought forward ||142577.30 ||112189.09 |
|Depreciation reversed on Capital Subsidy Received ||912.02 ||Nil |
|Net Profit available for Appropriation ||177999.74 ||165324.90 |
|Appropriation: || || |
|Dividend on Equity Shares ||28565.91 ||19043.94 |
|Dividend Distribution Tax ||5815.36 ||3703.67 |
|Transfer to General Reserves ||Nil ||Nil |
|Balance carried to Balance Sheet ||177826.53 ||142577.30 |
Your Directors recommend for approval of the Members at the ensuing Annual GeneralMeeting (AGM) a dividend of Rs 1.50/- per Equity Share (15%) for the financial year ended31st March 2017. The dividend will be paid in compliance with the applicable rules andregulations.
3. SHARE CAPITAL
There was no change in the Companys share capital during the year under review.
The Companys paid up equity share capital remained at Rs 190439390 comprisingof 19043939 equity shares of Rs 10/- each.
4. OVERVIEW OF OPERATIONS
During the year under review your Company recorded a total income of Rs 485344.30(000) as compares to last years total Income of Rs 505777.60 (000) andNet Profit of Rs 34510.42 (000) as compared to last years Rs 53135.81(000). For further information kindly refer to Management Discussion and AnalysisReport forming part of this Annual report.
5. EXTRACT OF ANNUAL RETURN
The Extract of Annual Return as provided under Section 92(3) of the Companies Act 2013("the Act") and as prescribed in Form No. MGT-9 of the Companies (Management andAdministration) Rules 2014 is appended as annexure i to the Annual Report.
6. NUMBER OF MEETINGS OF THE BOARD
The Board met four (4) times in financial year 2016-17 viz. on 12th May 2016 10thAugust 2016 10th November 2016 and 10th February 2017.
7. DIRECTORS RESPONSIBILITY STATEMENT
Your Directors hereby confirm that: i. In the preparation of the annual accounts forfinancial year ended 31st March 2017 the applicable accounting standards have beenfollowed along with proper explanation relating to material departures; ii. The Directorshave selected such accounting policies and applied them consistently and made judgmentsand estimates that are reasonable and prudent so as to give a true and fair view of thestate of affairs of the Company at 31st March 2017 and of the profit of the Company forthat period. iii. The Directors have taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the Provisions of this Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities. iv. The Directors have prepared the annual accounts for financial yearended 31 st March 2017 on a going concern basis. v. The Directors have laiddown internal financial controls to be followed by the Company and that such internalfinancial controls are adequate and have been operating efficiently. vi. The Directorshave devised proper systems to ensure compliance with provisions of all applicable lawsand that such systems were adequate and operating effectively.
8. DECLARATION BY INDEPENDENT DIRECTORS
The Independent Directors of the Company have submitted the declaration of Independenceas required under Section 149(7) of the Act confirming that they meet the criteria ofindependence under Section 149(6) of the Act and Regulation 16 (1)(b) of the SecuritiesExchange board of India (Listing Obligations and Disclosure Requirements)
Regulations 2015 (Listing Regulations).
9. POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The Policy of the Company on Directors appointment and remuneration includingcriteria for determining positive attributes independence of a Director and other mattersprovided under sub-section (3) of qualifications
Section 178 of the Act and Regulation 19 of Listing Regulations is appended as annexureii to this Annual Report.
10. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
The details of Loans Guarantees and Investments covered under the provisions ofSection 186 of the Act read with Companies (Meeting of Board and Its Powers) Rules 2014as on 31st March 2017 are given in the notes to the Financial Statements forming part ofthis Annual report.
11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year 2016-17 your Company has entered into transactions withrelated parties as defined under Section 2(76) of the Act read with the Companies(Specification and Definitions Details) Rules 2014 and Rules made thereunder andRegulation 23 of the Listing Regulations. During the financial year 2016-17 the Companyhas not entered into transactions with related parties which qualify as materialtransactions as per Listing Regulations. The Form AOC- 2 of the Companies (Accounts)Rules 2014 is set out as annexure iii to this Annual Report.
The details of related party transactions as required under Accounting Standard-18 areset out in notes to accounts to the Financial Statements forming part of this AnnualReport.
The Policy on Related Party Transaction may be accessed on the Companys websiteat the link: http://www. arrowtextiles.com/Related-Party-Transaction-Policy.pdf
12. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
13. PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo as required under Section 134(3)(m) of the Act read with theCompanies (Accounts) Rules 2014 is given in
Annexure iV to this Annual Report.
14. BUSINESS RISK MANAGEMENT
The Board of Directors of the Company has constituted a Risk Management Committee toframe implement and monitor the risk management plan for the Company.
The Company has a robust Risk Management framework to identify evaluate business risksand opportunities. This framework seeks to create transparency minimize adverse impact onthe business objectives and enhance the Companys competitive advantage.
The business risk framework defines the risk identification and its management approachacross the enterprise at various levels including documentation and reporting. Theframework helps in identifying risks trend exposure and potential impact analysis on aCompanys business.
15. CORPORATE SOCIAL RESPONSIBILITY
The Board has constituted a Corporate Social Responsibility (CSR) Committee inaccordance with Section 135 of the Act. Your Companys Annual Report on the CSRactivities undertaken during the financial year ended 31st
March 2017 in accordance with Section 135 of the Act and Companies (Corporate SocialResponsibility Policy) Rules 2014 is annexed to this report as Annexure V.
16. VIGIL MECHANISM
The Company has adopted a Vigil Mechanism and Whistle Blower Policy for Directors andEmployees in compliance with the provisions of Section 177(10) of the Act and Regulation22 of the Listing Regulations to report genuine concerns and to provide for adequatesafeguards against victimization of persons who may use such mechanism.
The said policy is also available on the Companys website www.arrowtextiles.com.
17. ANNUAL EVALUATION OF PEFORMANCE OF THE BOARD
Pursuant to the provisions of the Act and Regulation 17 of the Listing Regulations theBoard has carried out an annual evaluation of its own performance performance of theDirectors as well as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee has defined the evaluation criteria for theBoard its Committees and Directors.
The Boards functioning was evaluated on various aspects including inter aliadegree of fulfilment of key responsibilities Board structure and compositionestablishment and delineation of responsibilities to various Committees effectiveness ofBoard processes information and functioning.
The Committees of the Board were evaluated after taking inputs from the Committeemembers on the basis of criteria such as degree of fulfillment of key responsibilitiesadequacy of Committee composition and effectiveness of meetings. The Board and theNomination and Remuneration Committee reviewed the performance of the individual directorson aspects such as attendance and contribution at Board/ Committee Meetings andguidance/support to the management outside Board / Committee Meetings. In addition theChairman was also evaluated on key aspects of his role including setting the strategicagenda of the Board encouraging active engagement by all Board members.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole. In a separate meeting of independentdirectors performance of non-independent directors performance of the board as a wholeand performance of the chairman was evaluated taking into account the views of executivedirectors and non-executive directors.
18. SUBSIDIARY COMPANIES
The Company does not have any subsidiary. However the Company has formulated policyfor determining material subsidiary and the same is available on Companys websiteand the same may be accessed at the link http://www.arrowtextiles.com/Policy-for-Determining-Material-Subsidiaries.pdf.
19. DETAILS RELATING TO DEPOSITS COVERED UNDER CHAPTER V OF THE ACT
The Company has neither accepted nor renewed any deposits during the financial year2016-17 in terms of Chapter
V of the Act.
20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
Material orders passed by the Regulators/Courts which would impact the going concernThere are no significant status of the Company and its future operations.
21. INTERNAL CONTROL WITH REFERENCE TO FINANCIAL STATEMENTS
The Company has in place adequate internal financial control with reference tofinancial statements. The Company has adopted accounting policies which are in line withthe Accounting Standards prescribed in the Companies (Accounting Standards) Rules 2006that continue to apply under Section 133 and other applicable provisions if any of theAct read with Rule 7 of the Companies (Accounts) Rules 2014 and relevant provisions ofthe Act to the extent applicable. These are in accordance with generally acceptedaccounting principles in India.
The Company in preparing its financial statements makes judgments and estimates basedon sound policies and uses external agencies to verify/validate them as and whenappropriate. The basis of such judgments and estimates are also approved by the StatutoryAuditors and Audit Committee.
The Internal Auditor evaluates the efficacy and adequacy of internal control systemaccounting procedures and policies adopted by the Company for efficient conduct of itsbusiness adherence to Companys policies safeguarding of Companys assetsprevention and detection of frauds and errors and timely preparation of reliable financialinformation etc. Based on the report of internal audit function process owners undertakecorrective action in their respective areas and thereby strengthen the controls.Significant audit observations and corrective actions thereon are presented to the AuditCommittee of the Board.
22. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Section 152(6)(e) of the Act Mr. Chand Arora(DIN: 00016583) Director of the Company will retire by rotation at the ensuing AGM andbeing eligible offers himself for re-appointment. The Board of Directors at its meetingheld on 11th August 2017 subject to the approval of the Members at the AGM re-appointedMr. Chand Arora as the Managing Director of the Company for a further term of one yearcommencing from 01st April 2018 up to 31st March 2019. Members are requested to refer toItem No. 5 of the Notice of the AGM and the Explanatory Statement for the terms ofre-appointment and remuneration of Mr. Chand Arora.
1. statutory auditor
M/s. Amit Desai & Co. Chartered Accountants have been the Auditors of the Companysince 2008-09 and have completed a term of ten years. Their term as auditors is up to theconclusion of the forthcoming AGM. In accordance with the provisions of Section 139 of theAct M/s. M. H. S. & Associates Chartered Accountants (Firm Reg. No.141079W) Mumbaiare proposed to be appointed as auditors for a period of 5 years commencing from theconclusion of this AGM till the conclusion of the 15th AGM of the Company to be held in2022 subject to ratification of their appointment at every AGM.
M/s. M. H. S. & Associates Chartered Accountants (Firm Reg. No.141079W) Mumbaihave consented to their appointment as Statutory Auditors and have confirmed that theirappointment if made will be in accordance with Section 139 read with Section 141 of theAct. Members are requested to approve the appointment of M/s M.H.S & Associatesand authorize the Board of Directors to fix their remuneration There are noqualifications reservations or adverse remarks or disclaimers made by Statutory Auditorsin their report.
2. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors of the Companyhad appointed A. K. Jain & Co. a firm of Company Secretaries in Practice to undertakethe Secretarial Audit of the Company for the year ended
31st March 2017. The Secretarial Audit Report is annexed as Annexure Vi to thisAnnual Report.
Following mentioned observation is made by Secretarial Auditor of the Company in thissecretarial audit report:- In terms of the provision of the Regulation 29(1)(e) of theSecurities and Exchange Board of India (Listing obligations and Disclosures Requirements)Regulations 2015 the Company has not given prior intimation to the Stock Exchanges forthe recommendation of dividend.
24. CORPORATE GOVERNANCE
Pursuant to Listing Regulations the Management Discussion & Analysis Report andCorporate Governance Report from Practicing Company Secretary on compliance with theconditions of Corporate together with Certificate
Governance as lay down forms a part of this Annual Report.
25. AUDIT COMMITTEE OF THE COMPANY:
The Companys Audit Committee comprises the following Directors:
1. Mr. Aditya Mangaldas (Chairman);
2. Mr. Chand Arora;
3. Mr. Aurobind Patel
4. Dr. Vrajesh Udani
The composition of the Audit Committee is in compliance with the requirements ofSection 177 of the Act and Regulation 18 of the Listing Regulations.
26. PARTICULARS OF EMPLOYEES
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) Rules 2014 thereare no employees drawing remuneration in excess of the limits set out in the said rulesand disclosures pertaining to remuneration and other details as required under
Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in Annexure Vii tothis Annual Report.
Your Directors express their sincere appreciation of the co-operation received fromshareholders bankers and other business constituents during the year under review. YourDirectors also wish to place on record their deep sense of appreciation for the commitmentdisplayed by all executives officers and staff resulting in the successful performanceof the Company during the year.
|Mumbai 11th August 2017 ||JAYDEV MODY |
|Registered Office: ||chairman |
|Plot No. 101-103 19th Street MIDC ||Din: 00234797 |
|Satpur Nasik - 422 007 Maharashtra. || |
|CIN: L51494MH2008PLC178384 || |
|Email ID: email@example.com || |
|Website: www.arrowtextiles.com || |
|Tel No : 91-253-3918200 || |