Your Directors have pleasure in presenting their 34th Annual Report on the business andoperations of the Company and the accounts for the financial year ended 31 March 2017.
1. Financial summary or highlights/Performance of the Company :
| || ||(Rs. in lacs) |
|Particulars ||Year Ended 31.03.2017 ||Year ended 31.03.2016 |
|Sales & other income ||20792.07 ||26980.82 |
|Profit/(loss) before depreciation financial exps tax & other adjustments ||1653.21 ||2371.81 |
|Less: financial expenses ||873.05 ||1176.62 |
|Profit/(loss) before depreciation tax & other adjustments ||780.16 ||1195.19 |
|Less: depreciation ||274.56 ||259.17 |
|Profit before tax & other adjustments ||505.60 ||936.02 |
|Extraordinary items ||- ||- |
|Provision for tax: || || |
|Current tax ||(115.36) ||(235.48) |
|Deferred tax ||(51.46) ||(58.77) |
|Net profit/loss after tax ||338.78 ||641.77 |
|Add: Profit brought forward ||2323.99 ||1868.56 |
|Opening balance of retained earnings ||- ||- |
|Profit available for appropriation ||2662.77 ||2510.33 |
|Less: dividend ||128.14 ||128.14 |
|Less: tax on proposed dividend ||26.12 ||26.09 |
|Less: tax on dividend ||- ||0.02 |
|Transfer to general reserve ||16.94 ||32.09 |
|Surplus carried forward to balance sheet ||2491.57 ||2323.99 |
State of Company's affairs
During the period under review your company has earned revenue from operations andother income of Rs. 20792.07 lacs with a net profit of Rs. 338.78 lacs. Thefinancial year has got an ardous start your company is currently going through aturnaround phase with a strong focus on improving the bottom line by rigorous costreduction & sales enhancement leveraging & superior range of products. Focus willbe on increasing the market share & driving volumes in domestic market and the companyis fully aligned in with the Board.
Research & Development
Bambino continues to focus on innovation of functional foods i.e. food items withdefinitive health benefits by fortification with natural products containing quantifiedamounts of active substances thus striving for "tasteful health". Our endeavoris to enhance the market demand and manufacture products based on it. New categoryextensions made in Vermicelli Macaroni Spaghetti and Pasta variants with inclusion ofnatural ingredients and dietary fiber components.
We continue to strive for overall value addition to existing or new products withhealth-promoting and disease-preventing ingredients
Your Directors are pleased to recommend a dividend of 16% for the period of 31st March2017 and the said dividend if approved would absorb a sum of Rs. 12814154 plusdividend tax of Rs. 2612659. The Dividend if approved at the ensuing AnnualGeneral Meeting will be paid to all eligible equity shareholders of the Company whosenames appear in the register of members as on the record date.
Your Company proposes to transfer Rs. 1693924 to General Reserve for thefinancial year ended 31st March 2017.
The Paid-up Share Capital of the Company as on 31st March 2017 is Rs. 80088460.
Number of Meetings of the Board of Directors
During the year ended 31 March 2017 Seven Board Meetings were held.
The dates on which the Board meetings were held are 15th April 2016 26th May 2016 4thJune 2016 4th August 2016 11th November 2016 13th February 2017 28th March 2017. Themaximum time gap between any two consecutive meeting was within the period prescribedunder the Companies Act 2013 and SEBI (LODR) Regulations 2015.
Directors Responsibility Statement as required under Section 134 of the Companies Act2013
Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto the Directors' Responsibility Statement the Board of Directors of the Company herebyconfirms:
i) that in the preparation of the Annual Accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures.
ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31 March 2017 andof Profit and Loss Account of the Company for that period;
iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv) that the Directors have prepared the Annual Accounts for the Financial Year ended31 March 2017 on a going concern basis;
v) that the Directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
vi) that the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
Statement on compliances of applicable Secretarial Standards
Pursuant to para 9 of the revised secretarial standards the Board herewith confirms tocomply with all the applicable secretarial standards of Board and General Meeting w.e.f 1stOctober 2017.
Statement on Declaration given by Independent Directors under Sub-Section (6) ofSection 149
The independent directors have submitted the declaration of independence as requiredpursuant to section 149(7) of the Companies Act 2013 stating that they meet the criteriaof independence as provided in sub-section(6).
Nomination and Remuneration Committee
The Nomination and Remuneration Committee consists of the following Directors namelyMr. S. Nageswara Rao Chairman Dr. S. Venkataraman and Dr. Lalitha Ramakrishna Gowda asmembers.
Brief description of terms of reference:
identifying persons who are qualified to become directors and who may beappointed in senior management in accordance with the criteria laid down and recommend tothe Board for their appointment and removal;
carry on the evaluation of every director's performance; formulation of thecriteria for determining qualifications positive attributes and independence of adirector;
recommend to the Board a policy relating to the remuneration of the directorskey managerial personnel and other employees;
formulation of criteria for evaluation of Independent Directors and the Board;
devising a policy on Board diversity; and
any other matter as the Board may decide from time to time.
Nomination and Remuneration policy
The objectives of the Policy
1. To lay down criteria and terms and conditions with regard to identifying persons whoare qualified to become Directors (Executive and Non-Executive) and persons who may beappointed in Senior Management and Key Managerial positions and to determine theirremuneration.
2. To determine remuneration based on the Company's size and financial position andtrends and practices on remuneration prevailing in peer companies.
3. To carry out evaluation of the performance of Directors.
4. To provide them reward linked directly to their effort performance dedication andachievement relating to the Company's operations.
5. To retain motivate and promote talent and to ensure long term sustainability oftalented managerial persons and create competitive advantage.
Particulars of Contracts or Arrangements with Related Parties Referred to inSub-Section (1) of Section 188
The particulars of contracts or arrangements with related parties referred to insub-section (1) of Section 188 is prepared in Form No. AOC-2 pursuant to clause (h) ofsub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules2014 and the same is enclosed as Annexure - 1 to this Report.
Extracts of Annual Return
The Extracts of Annual Return is prepared in Form MGT-9 as per the provisions of theCompanies Act 2013 and Rule 12 of Companies (Management and Administration) Rules 2014and the same is enclosed as Annexure -2 to this Report.
The conservation of energy technology absorption foreign exchange earnings and outgopursuant to provisions of Section 134(3)(m) of the Companies Act 2013 (Act) read with theCompanies (Accounts) Rules 2014
Information with respect to conservation of energy technology absorption foreignexchange earnings and outgo pursuant to Section 134(3)(m) of the Act read with Companies(Accounts) Rules 2014 is prepared and the same is enclosed as Annexure - 3 to thisReport.
Risk Management Policy
The Company has laid down the procedure for risk assessment and its mitigation throughan internal Risk Committee. Key risks and their mitigation arising out of reviews by theCommittee are assessed and reported to the Audit Committee on a periodic basis. The RiskManagement Policy details the Company's objectives and principles of Risk Management alongwith an overview of the Risk Management process procedures and related roles andresponsibilities.
CORPORATE SOCIAL RESPONSIBILITY
The brief outline of the corporate social responsinility (CSR) of the company are theintiatives undertaken by the Company on csr activites during the year are set out inAnnexure -4 of this report is in the fomat prescribed in the Companies (CorporateSocial Responsibility policy) rules 2014 for other details regarding csr committee pleaserefer Corporate governance report
Pursuant to the provisions of Section 135 of the Companies Act 2013 and the Rules madethereunder on the recommendation of the Committee the Board has in place CorporateSocial Responsibility (CSR') policy and the same is available on the website of theCompany "www.bambinoagro.com".
Company has spent the prescribed amount of Rs. 14.37 lacs on CSR activities inthe areas of Eradicating hunger Poverty and malnutrition and promoting healthcare. Thedetails on CSR activities are provided in Annexure - 4 and forms part of this report.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance and the performance of the individualDirectors as well as the evaluation of the working of its Committees. The manner in whichthe evaluation was carried out has been detailed in the Corporate Governance Report.
Mr. Sanjay Baral (DIN No.07643433) Director of the Company retires by rotation andbeing eligible offers himself for re-appointment.
Details of Directors or Key Managerial Personnel who were appointed or have resignedduring the year
Mr M Subramanyam and Mr Easwara Das Directors have resigned from the Board on31-10-2016 and 15-9-2016 respectively. Mr M Kishan Rao also resigned as Director w.e.f14-9-2016. The Board of Directors of the Company had on recommendation of Nomination andRemuneration Committee at its meeting held on 11th November 2016 27th February 2017 6thJuly 2017 & 12th August 2017 appointed Mr Madam Kartekeya as Additional Director MrSanjay Baral as Director-Sales & Marketing on a remuneration of Rs. . 500000p.m Mr M Kishan Rao as Chairman and Managing Director for a period of 5 years withoutremuneration & appointed Ms. Myadam Shirisha as Non- Executive Director subject tothe approval of shareholders. Necessary resolutions seeking approval of members forappointment together with remuneration payable to them have been incorporated in theNotice of Annual General Meeting of Company along with brief details about them.Mr.Kartekeya has vacated his office w.e.f 9th September 2017.
Mr S Nageswara Rao Dr. S Venkataraman and Dr. Lalitha Ramakrishna Gowda continue asIndependent Directors on the Board of the Company. The terms and conditions of appointmentof Independent Directors are as per Schedule IV of the Act. They have submitteddeclarations that each of them meets the criteria of independence as provided in Section149(6) of the Act and there has been no change in their status as Independent Directorduring the year.
For Directors seeking appointment/re-appointment in the forth coming Annual GeneralMeeting of the Company the particulars as required to be disclosed in accordance withReg. 36 of SEBI (LODR) Regulations 2015 is provided in notice of Annual General Meeting.
The Company has not accepted any deposits from the public in terms of Section 73 of theCompanies Act 2013.
In terms of the provisions of Section 139 of the Act read with the Companies (Audit andAuditors) Rules 2014 an audit firm can hold office as statutory auditor for two terms offive consecutive years i.e. for a maximum period of ten years. Further as per theprovisions of the Act Company is required to comply with these provisions within threeyears from the commencement of the Act.
As M/s PRV Associates have been in office for more than 10 years in compliance withthe provisions of the Act the Company had to appoint a new auditor in their place for theFY 2017-18. In terms of the shareholder's resolution passed at the 31st Annual GeneralMeeting of the Company held on 26thDecember 2014 M/s PRV Associates shall hold officeuntil the conclusion of the ensuing 34th AGM. The Board of Directors has at its Meetingheld on 23 May 2017 recommended appointment of M/s. Kumar & Giri CharteredAccountants Firm Registration No. 001584S as the new statutory auditors of the Companyto hold office for one term of 5 years commencing from conclusion of the ensuing 34thAnnual General Meeting upto the 39th Annual General Meeting of the Company.
The Company has received a certificate from the M/s. Kumar & Giri CharteredAccountants to the effect that their appointment if made shall be in compliance withthe provisions of Section 139 and 141 of the Companies Act 2013. Accordingly the Boardproposes appointment of M/s. Kumar & Giri Chartered Accountants to hold office fromthe conclusion of this AGM until the conclusion of the 39th AGM of your Company.
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 Mr Chandrakanth Gorak Practicing Company Secretary (CP No. 11346) to undertakethe secretarial audit of the company. The Secretarial Audit Report is annexed herewith asAnnexure 5'.
The Auditors Report and Secretarial Auditor Report do not contain any qualificationsreservations or adverse remarks.
Audit Committee consists of the following Directors namely Mr. M. Kishan Rao Chairmanand Managing Director w.e.f 6th July 2017 Late Mr. M. Raghuveer upto 25th June 2017 Mr.S. Nageswara Rao Dr. S. Venkataraman and Dr. Lalitha Ramakrishna Gowda. Except Mr. M.Kishan Rao all the other members of Audit Committee are Independent Directors.
There is no such incidence where Board has not accepted the recommendation of the AuditCommittee during the year under review.
A separate report on Corporate Governance and Management Discussion and Analysis isannexed as part of the Annual Report along with the Auditor's Certificate on itscompliance.
The SEBI (LODR) Regulations 2015 mandated the formulations of certain policies for alllisted companies. All the corporate policies are available on the company'swebsite:www.bambinoagro.com. The policies are reviewed periodically by the Board andupdated based on need and new compliance requirement.
The Board of Directors have adopted Whistle Blower Policy. The Whistle Blower Policyaims for conducting the affairs in a fair and transparent manner by adopting higheststandards of professionalism honesty integrity and ethical behavior. All permanentemployees of the Company are covered under the Whistle Blower Policy.
A mechanism has been established for employees to report concerns about unethicalbehavior actual or suspected fraud or violation of Code of Conduct and Ethics. It alsoprovides for adequate safeguards against the victimization of employees who avail of themechanism and allows direct access to the Chairperson of the audit committee inexceptional cases.
Statement of particulars of appointment and remuneration of managerial personnel
The Statement of particulars of Appointment and Remuneration of Managerial personnel asper Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is enclosed as Annexure - 6 to this Annual Report. There are no employees who are eitheremployed for the whole/Part of the financial year are in receipt of remuneration exceedingRs. 8.5 lacs per month or Rs. 102 lacs per annum as stipulated under Rule5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The information required pursuant to section 197(12) of the companies act read withrule 5 of the companies (appointment & remuneration of managerial personel) rules2014 is annexed herto as annexure-6a statement showing names & other particulars ofthe top ten employees. However as per the provisions of section 136(1) of the companiesact 2013 the annual report is being sent to all the members excluding the aforesaidstatement. The statement is available for inspection at the registered office of thecompany during the working hours.
Internal Control Systems and their adequacy
The Company has an adequate internal control system commensurate with the size andcomplexity of the organization. The Company has undertaken a comprehensive review of allinternal control systems to take care of the needs of the expanding size of the Companyand also upgraded the IT support systems. A system of internal audit to meet the statutoryrequirement as well as to ensure proper implementation of management and accountingcontrols is in place. The Audit Committee periodically reviews the adequacy of theinternal audit functions.
Change in the nature of business
There is no change in the nature of business of the Company.
The details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future
No Significant and material orders passed by the regulators or courts or tribunalsimpacting the going concern status and company's operations in future.
Material changes and commitments
There are no Material changes and commitments in the business operations of the Companyfrom the Financial year ended 31 March 2017 to the date of signing of the Director'sReport.
Policy on Sexual Harassment
The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplacein accordance with The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.
During the financial year ended 31 March 2017 the Company has not received anyComplaints pertaining to Sexual Harassment.
Pursuant to the provisions of SEBI (LODR) Regulations 2015 a declaration by theManaging Director of the Company declaring that all the members of the Board and theSenior Personnel of the Company have affirmed compliance with the Code of Conduct of theCompany is enclosed.
Your Directors wish to place their sincere appreciation for the support andco-operation that the Company has received from its Shareholders Bankers CustomersSuppliers Stockists Selling Agents Central and State Governments various StatutoryAuthorities and others associated with the Company. Your Directors also wish to place onrecord their appreciation to employees at all levels for their commitment hard work anddedicated support.
| ||For and on behalf of the Board of Directors |
| ||of Bambino Agro Industries Limited |
| ||M. Kishan Rao |
|Place: Secunderabad ||Chairman and Managing Director |
|Date: 28th November 2017 ||DIN No. 02425967 |