Your Directors have pleasure in presenting the 28th Annual Report of the Companytogether with the audited statements of account for the financial year ended March 312018.
1. FINANCIAL RESULTS :
| ||2017-18 ||2016-17 |
|Sales ||26022.68 ||29527.24 |
|Other Income ||52.56 ||59.81 |
|Total Income ||26075.24 ||29587.05 |
|Profit before interest & depreciation exceptional items and Tax ||2225.47 ||2165.44 |
|Less: Financial expenses ||1072.92 ||1089.97 |
|Less: Depreciation ||475.34 ||462.90 |
|Profit before tax ||677.21 ||612.57 |
|Tax expense (net) ||(69.36) ||(61.66) |
|Profit after tax ||607.85 ||550.91 |
|Transfer to General Reserve ||0 ||0 |
|Earning Per Share (face value of Rs. 1/- each) ||0.67 ||0.61 |
2. Corporate Overview and the state of Company's affairs
The year 2017-18continuedtobe financial year 2017-18 the Company has kept morechallenging period. During the focus on cost cutting measures and as result of thiscompany able to increase its profitability from Rs. 612.57 lakhs (Previous Year) to Rs.677.21 lakhs even though the turnover of the Company has reduced from Rs. 295.87 Cr to Rs.260.75 Cr. The Seed division continued its steady growth and managed to contribute 48.46%of the total turnover of the Company.
The performance of the Agro industries for the financial year 2017-18 continued to besluggish as some regions like Karnataka Madhya Pradesh faced a drought condition. Duringthe year continuing impact of demonetization and implementation of GST had a major impactby way of slowdown in India agriculture sector. Keeping in mind the huge dependence of theagriculture sector on cash the farmers especially small and marginal among them wereadversely affected. The recoveries from the market have been extremely slow.
Further a transition to partial Direct Benefits Transfer system for the Fertilizersindustry slowed down trade due to uncertainty. The Government of India has modified theprocedure for release of fertilizer subsidy and partial DBT whereby a POS (Point of Sale)device has been distributed to the traders. Under the new procedure the subsidy willcontinued to be paid to the industry instead of the farmer but only after sale offertilizer to the farmer through the POS device. The system is under implementation and isbeing stabilized. The new system is likely increase the working capital cycle for theIndustry. Earlier the SSP industry was claiming subsidy from Government immediately onfirst point sale to dealer however now the we will be eligible for subsidy only on lastpoint sale from retailer to farmer.
In the current year 2018-19 the long range forecast of monsoons is normal and weexpect to perform better this year.
There has not been any material changes and commitments affecting the financialposition of the company which have of the company to which Financial Statements relate andthe date of this occurred between the end of the financial report. There have not been anychanges in the Nature of Business of the Company during the year.
There have not been any changes in the Share capital of the Company during the year.
3. DIVIDEND :
The Board of Directors are pleased to recommend the dividend of Rs. 0.05 per share (5%)for the year 2017-18 on equity share capital subject to the approval of the shareholdersat the Annual General Meeting (Previous Year 5%) which shall absorb Rs. 45.31 lakhs(Previous Year Rs. 45.31 lakhs).
4. CAPITAL EXPENDITURE INCURRED :
The Company had incurred Rs. 282.73 lakhs as the capital expenditure during the yearunder review (Previous Year Rs. 424.94 lakhs).
6. DIRECTORS/ KEY MANAGERIAL PERSONNEL (KMP) DETAILS :
Pursuant to the provisions of sub section (6) of section 152 the Companies Act 2013Shri. Ashwin Bhartia is liable to retire by rotation at the ensuing Annual General Meetingand being eligible offers himself for re-appointment.
During the year based on the recommendations of Nomination and Remuneration Committeethe Board of Directors reappointed Shri. Shashikant Bhartia as a Chairman & ManagingDirector Shri. Deepak Bhartia as a Managing Director and Shri. Ashwin Bhartia as aExecutive Director of the Company for period of five years effective from 28th January2018 to 27th January 2023.The re-appointment is subject to the approval of the members ofthe company at ensuing Annual General Meeting of the Company. The Board seeks your supportand hopes you will enthusiastically vote in confirming the re-appointment of Shri.Shashikant Bhartia Shri. Deepak Bhartia and Shri. Ashwin Bhartia. The term of office ofShri. Rameshwar Kabra Shri. R.S. Tayade and Shri. S.W. Sawant as an Independent Directorwill expired on March 31 2019 and Smt. M.M. Khandelwal as an Independent Director willexpired on 21st July 2019. Board of Directors on recommendation of Nomination andRemuneration Committee has recommended re-appointment of Shri. Rameshwar Kabra Shri. R.S.Tayade and Shri. S.W. Sawant and Smt M.M. Khandelwal as an Independent Directors of theCompany for a second term of 5 (five) consecutive years on the expiry of his current termof office
During the year Dr. B.G. Bathkal the Independent director of the Company has expiredon 15.06.2017. The Board of Directors had conveyed heart-felt condolences to the bereavedfamily on behalf of the Company. The Board placed on record the invaluable contributionsof Dr. B.G Bathkal towards the progress of the Company. The Board of Directors observedtwo minutes silence as a mark of respect to the departed soul and wished his soul may restin peace.
Independent Directors' Declaration
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under the provisionsof the Companies Act 2013 read with the Schedules and Rules issued thereunder as well asRegulation 16(1)(b) of Listing Regulations (including any statutory modification(s) orre-enactment(s) for the time being in force).
7. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS :
There are no significant and material orders passed by regulators/ courts that wouldimpact the going concern status of the Company and its future operations.
8. SHARE CAPITAL:
There have not been any changes in the share capital of the Company during the year.
9. STATUTORY AUDITORS :
The Board of Directors on the recommendation of the Audit Committee has proposed toratifies the appointment M/s Amar Bafna & Associates Chartered Accountants Mumbaiand M/s Gautam R. Agrawal & Associates Chartered Accountants Akola as JointStatutory Auditors of the Company from conclusion of this Annual General Meeting till theconclusion of the 29th Annual General Meeting of the Company. They have furnished theconfirmation regarding their eligibility to the effect that their appointment if madewould be within the prescribed limit under the Act and they are not disqualified forappointment.
Shri. T.M. Rathi the Cost Accountants carried out the cost audit for applicablebusiness during the year. The Board of Directors has re-appointed Shri. T.M. Rathi CostAccountant as Cost Auditors for the financial year 2018-19.
10. INTERNAL FINANCIAL CONTROLS :
The company has adequate internal financial control system commensurate with the sizeand scale of its operations and the same has been operating effectively. Statutory andinternal Auditors evaluate the efficiency and adequacy of internal control systemaccounting procedures and policies adopted by the Company for efficient conduct of itsbusiness adherence to Company's policies safeguarding of Company's assets preventionand detention of frauds and errors and timely preparation of reliable financialinformation etc and internal financial control system is being upgraded as per theirrecommendation
11. COMPANY'S POLICY ON SELECTION OF DIRECTORS AND DETERMINING DIRECTORS' INDEPENDENCEAND REMUNERATION :
The Company has a Nomination and Remuneration Committee (NRC) and the Composition ofCommittee and the Scope of the Committee are set out in the Corporate Governance Reportforming part of this Annual Report.
The Company's Policy for selection and appointment of Directors and their remunerationis based on its NRC policy which inter alia deals with the manner of selection of theBoard of Directors and such other matters as provided under section 178(3) of the Act andSEBI Listing Regulations.
The shareholders may refer the Company's website for the detailed Nomination &Remuneration Policy of the Company on the appointment and remuneration of Directorsincluding criteria for determining qualifications independence of Director nd othermatters provided under sub-section (3) of section 178.
12. AUDITORS' REPORT :
The Statutory Auditors of the Company have not reported any fraud as specified underthe second proviso of Section 143(12) of the Companies Act 2013 (including any statutorymodification(s) or re-enactment(s) for the time being in force. The Auditors' Report forthe financial year ended 31st March 2018 does not contain any qualification resrvationor adverse remark.
13. SECRETARIAL AUDIT :
M/s. Ferrao MSR & Associates Practicing Company Secretary carried out SecretarialAudit for the Financial Year 2017-18 and their report is annexed herewith as Annexure C tothis report. The Secretarial Audit Report does not contain any qualification reservationor adverse remark.
In terms of Section 204 of the Companies Act 2013 the Board of Directors of theCompany has re- appointed M/s. Ferrao MSR & Associates Practicing Company Secretaryas Secretarial Auditors to conduct the secretarial audit for the financial year 2018-19.
14. EXTRACT OF ANNUAL RETURN :
Extract of Annual Return of the Company in form MGT-9 is annexed herewith as AnnexureD' to this report.
15. PUBLIC DEPOSIT :
During the year the Company has not accepted any deposit within the meaning of Section73 and 74 of Companies Act 2013 read with the Companies (Acceptance of Deposit) Rules2014 (including any statutory modification (s) or reenactment(s) for the time being inforce).
16. CORPORATE SOCIAL RESPONSIBILITY (CSR) :
The CSR expenditure incurred by the company during the financial year 2017-18 was Rs.18.21 lakhs ( Previous Year 20.20 lakhs) which was higher than the statutory requirementof 2% of the average profit for the last three years. In accordance to provision ofSection 135 of the Company Act 2013 and Companies (Corporate Social ResponsibilityPolicy) Rules 2014 the details of the CSR expenditure is annexed to this report asAnnexure- A.
The CSR policy of the company mainly focuses on the welfare & sustainable growthand development of the weaker section of the Society which is in line with the company'sage old policy of providing necessary financial upliftment of the poor people as well aswelfare of the physically handicapped and deaf and blind citizens. The CSR policy of theCompany has emphasis on undertaking the various activities in rural area like Ruraldevelopment Promoting education Providing healthcare and Building the community centersthe details of which are available on the Company's website.
17. DIRECTORS' RESPONSIBILITY STATEMENT :
Pursuant to section 134 of the Companies Act 2013 with respect Directors'Responsibility Statement it is hereby confirmed that:
i. in the preparation of the annual accounts for the financial year ended 31st March2018 the applicable accounting standards had been followed and there is no materialdepartures from the same;
ii. the directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 i:e31st March 2018 and of the profit and loss of the company for that period;
iii. the directors have taken proper and sufficientcare for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities
iv. the directors have prepared the annual accounts on a going concern basis;
v. the directors have implemented internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
vi. the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
18. MEETING OF BOARD:
Twelve meetings of the Board of Directors were held during the year under review. Forfurther details please refer report on Corporate Governance published in this AnnualReport.
19. RELATED PARTY TRANSACTIONS:
The Company has formulated a Policy on Related Party Transaction (RPT) which isavailable on Company's website.
All contracts / transactions as specified in Section 188 of the Act the financial yearwere in the ordinary course of business and on an arm's length basis with necessary priorapproval members & audit committee. The Note No. 33 to Financial Statements sets outrelated party disclosures.
Since all related party transactions entered into by the Company were in the ordinarycourse of business and were on arms' length basis Form AOC-2 is not applicable to theCompany.
20. CORPORATE GOVERNANCE:
Pursuant to clause 34 of the listing agreement with the BSE Ltd a separate sectiontitled "Report on Corporate Governance" is being published as a part of thisAnnual Reportalongwiththecertificateof the auditors confirming the compliance ofconditions of the corporate governance.
Various disclosure as required under section 134 and 135 of the Companies Act 2013 areannexed to this report or covered in the Corporate Governance Report such as relatedparty transaction extract of Annual return constitution of various Board levelcommittees CSR policy and initiative taken during the year remuneration of themanagerial personnel secretarial audit report etc.
21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT :
The Management Discussion and Analysis forms an integral part of this report has beenseparately furnished in Annual Report. The Management Discussion and Analysis givesdetails of organization overall industrial economic overview current and future outlookstrength and weakness cautionary statement.
22 RISK MANAGEMENT POLICY :
The Company has got the risk management policy which is in line with applicable lawsand which aims at identifying assessing and mitigating the various risks which areinherent in the business of the Company. The risk management policy helps in enhancing thebusiness values of the Company with code of conduct adequate quality checks and internalcontrols. The risk management policy has been developed and implemented by operative teamsat various levels of management.
23. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIESPROVIDED :
During the year company has not made any investment given loans and providesguarantees in pursuant to provision of section 186 of the Companies Act 2013 read withthe Companies (Meetings of Board and its Powers) Rules 2014.
24. PARTICULARS OF EMPLOYEES UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 :
There were no employees whose remuneration was in excess of the limits prescribed underSection 197 (12) of the Companies Act 2013 read with Rules 5 (2) of Companies(Appointment and remuneration of Managerial personnel) Rules 2014.
The ratio of remuneration of each director to the median employee's remuneration andother details in accordance withsub-section 12 of the Section 197 of the Act read withRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 form part of this report as Annexure - E.
25. PARTICULARS OF ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO :
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe Companies (Account) Rules 2014 is set out herewith as Annexure - B.
26. ACKNOWLEDGEMENTS :
Your Directors would like to express their appreciation for the support andco-operation received from financial institutions company's bankers governmentauthorities and shareholders during the year under review. The Company wishes to place onrecord their sincere appreciation to all employees for their commitment and continuedcontribution to the Company.
| ||For and on behalf of the Board |
| ||Shashikant C.Bhartia |
|Place : Mumbai ||Chairman & Managing Director |
|Date : 29th May 2018 ||DIN : 00151358 |