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Bemco Hydraulics Ltd.

BSE: 522650 Sector: Engineering
NSE: N.A. ISIN Code: INE142E01014
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NSE 05:30 | 01 Jan Bemco Hydraulics Ltd
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VOLUME 3
52-Week high 210.00
52-Week low 123.55
P/E 32.22
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 155.00
CLOSE 155.00
VOLUME 3
52-Week high 210.00
52-Week low 123.55
P/E 32.22
Mkt Cap.(Rs cr) 34
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Bemco Hydraulics Ltd. (BEMCOHYDRAULICS) - Director Report

Company director report

To the Members

The Directors have pleasure in presenting their 59th Annual Report of the Companytogether with the Audited Statements of Accounts for the year ended 31st March 2017incorporating therein the consolidated financial statement covering the activities of itssubsidiary BEMCO FLUIDTECHNIK LLP incorporated on 27th February 2017(formerly known asBEMCO FLUIDTECHNIK PRIVATE LIMITED which was incorporated on 13th February 2015).

1. FINANCIAL SUMMARY/HIGHLIGHTS OPERATIONS STATE OF AFFARIS:

[Read with Section 134 of the Companies Act 2013 and Rule 5 (i) of Cos (Accounts)Rules 2014]

(Rs. in lakhs)

Standalone Consolidated
Particulars 2016-17 2015-16 2016-17 2015-16
Gross Income 4198.83 2184.34 4253.24 2168.38
Profit Before Interest and Depreciation 804.87 83.69 772.20 58.33
Finance Charges 268.99 266.37 283.11 268.32
Gross Profit 535.88 (182.68) 489.09 (209.99)
Provision for Depreciation 122.16 124.55 126.18 125.55
Net Profit Before Tax 413.72 (307.23) 362.91 (335.54)
Provision for Tax (0.06) (0.60) (0.06) (0.60)
Net Profit After Tax 413.78 (307.83) 362.97 (336.14)
Balance of Profit brought forward (768.83) (461.00) (796.79) (461.00)
Balance available for appropriation (355.05) (768.83) (433.82) (797.14)
Share of minority Interest - - - (0.35)
Deficit carried to Balance Sheet (355.05) (768.83) (433.82) (796.79)

Standalone

As against targeted turnover of Rs. 4162.20 Lakhs the company has achieved turn over ofRs. 4198.83 Lakhs as against Rs. 2182.98 Lakhs for the previous year. The profit for theyear works out to Rs. 413.66 Lakhs as against the loss incurred of Rs. 307.83 Lakhs of theprevious year.

Consolidated the consolidated statement of Bemco hydraulics Limited with BemcoFluidtechnik LLP is reproduced in brief. The consolidated turnover was Rs.4253.21/- Lakhsas against Rs. 2167.02 for the previous year. The consolidated profit for the year is ofRs. 362.97/- Lakhs as against the loss incurred of Rs. 336.14/- for the previous year thedeficit carried forward to Balance sheet is Rs.433.82/- Lakhs.

2. EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

Subsequent to the date of Financial Statements (i.e. after 31st March 2017) nosignificant event has occurred.

3. CHANGE IN THE NATURE OF BUSINESS:

During the year under operation there was no change in the nature of business.Nonetheless the Board desires to report that the subsidiary company BEMCO FLUIDTECHPRIVATE LIMITED was converted in to Limited Liability Partnership in terms of the LimitedLiability Partnership Act 2008.

4. SHARE CAPITAL

There is no change in the capital structure of the company. During the year thepromoters have pledged 30% of their equity shares to Bank of Maharashtra in the form ofcorporate guarantee.

5. DIVIDEND:

Equity Shares:

As the company's profit amounts to Rs.413.66/- lakhs the board decided to retain theprofit in business and therefore no dividend is proposed for the financial year 2016-17.

Preference Shares:

Since the profit is retained for expansion of business the Company is unable to paydividend for the year including arrears thereof for the year ended on 31st March 2017 asunder:

F. Y. ended on No. of Preference Shares Amount of Dividend in Rs.
31st March 2015 320000 8711484/-
31st March 2016 320000 12948072/-
31st March 2017 320000 17184660/-

31 March 2017 320000 17184660/-These preference shares are held by the promotersthemselves as borne by the list of preference share holders as under:

1. MOHTA CAPITAL PRIVATE LIMITED

2. U D FINNVEST PRIVATE LI MITED

3. SRI RAMACHANDRA ENTERPRISES PRIVATE LIMITED

In view of the above Company is carrying the above amount as Liability towardsDividend on Preference Shares

As no Dividend is paid on preference shares for F. Y. 2014-15 2015-16 and also for FY 2016-17 the Preference Share holders would get voting rights on par with equity shareholders in terms of the provisions of Section 47 of the Companies Act 2013 on and afterthe forthcoming AGM.

6. DIRECTORS AND KEY MANANGERIAL PERSONNEL :

There is no change in the composition of Board of Directors of the Company during theyear under report:

DIRECTORS
1. Mr. M. M. MOHTA - Chairman Non Executive
2. Mr. ANIRUDH MOHTA - Managing Director Executive
3. Mrs. URMILA DEVI MOHTA - Director Non Executive
4. Mr. R. M. SHAH - Director Independent Non- Executive
5. Mr. N. K. DAGA - Director Independent Non- Executive
6. Mr. DILIP CHANDAK - Director Independent Non- Executive
KEY MANAGERIAL PERSONNEL KMP
1. MR. ANIRUDH MOHTA Managing Director
2. MR. R. B. PATIL Chief Finance Officer
3. MS. AMRUTA A. TARALE Company Secretary
7. COMPOSITION OF COMMITTEES:
a. AUDIT COMMITTEE
Chairman: Mr. Dilip Chandak- Independent Director
Other Members: Mr. R. M. Shah Independent Director
Mr. N. K. Daga- Independent Director
Mr. Anirudh Mohta Managing Director
b. NOMINATION AND REMUNERATION COMMITTEE
Chairman: Mr. R. M. Shah Independent Director
Other Members: Mr. Dilip Chandak Independent Director
Mr. N K Daga Independent Director
Mrs. Urmila Devi Mohta Non Executive Director
c. STAKE HOLDERS RELATIONSHIP COMMITTEE
Chairman: Mr. Dilip Chandak Independent Director
Other Members: Mr. Anirudh Mohta Managing Director
Mrs. Urmila Devi Mohta Non Executive Director
d. COMMITTEE FOR PREVENTION OF SEXUAL HARRSSMENT OF WOMAN AT WORKPLACE
Chairman: Ms Kirti Ramchandra Devale Company Employee
Other Members: Mrs. Madhuri Kulkarni- Company Employee
Ms. Jyoti Killekar- Company Employee

8. STATUTORY DISCLOSURE UNDER COMPANIES ACT 2013 (PURSUANT TO SECTION 134(3) OFTHE COMPANIES ACT 2013 READ WITH COMPANIES (ACCOUNTS) RULES 2014)

ANNEXURE PAGE NO
a. Extract of annual return- Form MGT-9 ANNEXURE- I 10
b. Number of meetings of the board ANNEXURE- II 14
c. a. Directors responsibility Statement ANNEXURE- II 14
b. details in respect of fraud reported by auditors under sub section (12) of section 143other than those which are reportable to the central government
d. A statement on declaration given by independent directors under sub - section (6) of section 149. ANNEXURE- III 15
e. Companies policy on directors appointment and remuneration including criteria for determining qualifications positive attributes independence of directors and other matters provided under sub - section (3) of section 178 ANNEXURE- III 15
Ratio of remuneration to each directors
f. Qualification and remarks ANNEXURE- IV 16
g. Particulars of loan guarantees or investment under section 186. ANNEXURE- IV 16
h. Particulars of Subsidiary Company AOC-1 ANNEXURE- V 17
i. Particulars of contracts or arrangement with related parties referred to in Sub-section 1 of section 188- AOC-2 ANNEXURE- VI 18
j. The conservation of energy technology absorption foreign exchange earnings and outgo. ANNEXURE- VII 19
k. A statement indicating development and implementation of a risk management Policy for the company including identification therein of elements of risk if any which in the opinion of the board may threaten the existence of the company. ANNEXURE- VIII 20
l. The details of the policy developed and implemented by the company on corporate social responsibilities taken during the year. ANNEXURE- VIII 20
m. A statement indicating the manner in which formal annual evaluation has been made by the board of its own performance and that of its committees and individual directors. ANNEXURE- VIII 20
n The state of the companies affairs MANAGEMENT 21
Material changes and commitments if any affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relates and the date of the Company. DISCUSSION AND ANALYSIS REPORT

9. DISCLOSURE PURSUANT TO SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013.

The Sexual Harassment Of Women At Workplace (Prevention Prohibition And Redressal)Act 2013 requires every employer to comply with its provision and make a disclosure ofthe number of cases occurring under the Act. Accordingly this report.

Sl. No. No. of cases filed under the Act before the internal committee. No. of disposal under the Act
NIL NIL

10. STATUTORY AUDITOR

Under Section 139 of the Companies Act 2013 and the Rules made there under it ismandatory to rotate the statutory auditors on completion of the maximum term permittedunder the said section. The audit committee of the Company has proposed and on August 182017 the Board of Directors of the Company has recommended the appointment of SJaykishan a partnership firm of Chartered Accountants (Firm Registration number 309005E)as the statutory auditors of the Company. S Jaykishan will hold office for a period offive consecutive years from the conclusion of the 59th Annual General Meeting of theCompany scheduled to be held on September 28 2017 till the conclusion of the 64thAnnual General Meeting to be held in the year 2022 subject to the approval of theshareholders of the Company.

The first year of audit will be of the financial statements for the year ending March31 2018 which will include the audit of the quarterly financial statements for the year.To align with the above the Board of Directors of the Company also approved theappointment of S Jaykishan a partnership firm of Chartered Accountants as statutoryauditors of the Company. This appointment is effective for the year ending March 31 2018.

11. AUDIT REPORTS

The audit conducted by M/s A. C. Bhuteria & Company Chartered Accountants (FirmRegistration No. 303105E) for financial year 2016-17 does not contain any qualificationreservation or adverse remark. The Auditors' Report is enclosed with the financialstatements in this Annual Report and it is self explanatory.

12. SECRETARIAL AUDIT:

M/s SDR & ASSOCIATES a Firm of Practicing Company Secretaries was appointed toconduct secretarial audit of the company for the financial year 2016-17 as required undersection 204 of Companies Act 2013. The report of Secretarial audit is enclosed to thisReport.

13. INTERNAL AUDIT:

CA Prabhakar Latkan (Chartered Accountant)was appointed to conduct internal audit ofthe company for the financial year 2016-17 as required under section 138 read with rule 13of companies (Accounts) Rules 2014. The internal audit report is given quarterly by theinternal auditor to the Board of Directors.

14. DISCLOSURE ABOUT COST AUDIT

In pursuance of Section 148 of Companies Act 2013 read with Rule 5(1) of Companies(Cost Record and Audit) Amendment Rules 2014. Mr Umesh Kini Cost Accountant was appointedas auditor of the company for the financial year 2016-17. However the Cost Audit is notApplicable to our Company but the company is maintaining Cost Records on routine basisand the Company obtains Cost Compliance report from a practicing Cost Accountant as amatter of good corporate practice and to instill cost consciousnesses at all level ofoperations.

15. CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

As per regulation 15 of SEBI (Listing Obligations and Disclosure Requirement)Regulations 2015 preperation of Corporate Governance Report is not applicable to ourcompany as it does not fall under the criteria laid down in the said regulation i.e. ourcompanies paid up equity share capital is not exceeding Rupees ten crore and net worth isnot exceeding Rupees twenty five crores as on the last date of previous financial yearbut as a good ethical practice BEMCO continues to follow corporate Governance practicesand a report on corporate governance is uploaded on our website www.bemcohydraulics.net.

16. VIGIL MECHANISM:

The Vigil Mechanism acts as an additional internal element of the Company's complianceand integrity policies. All employees directors vendors suppliers dealers andconsultants including auditors and advocates who are associated with BEMCO can raiseconcerns regarding malpractices and events which may negatively impact the company. VigilMechanism has been established under the supervision of the Chief financial Officer andthe Company Secretary of the Company. The Audit Committee the CFO and the companysecretary reviews the working of the Vigil Mechanism from time to time and makesuggestions if needed. The Vigil protects the whistleblower against victimization for thedisclosures made by him/her and ensures complete confidentiality of the whistleblower'sidentity and the information provided by him/her. The investigation is conducted honestlyneutrally and in an unbiased manner. The subject or other involved persons in relationwith the protected disclosure are also given an opportunity to be heard. Strictdisciplinary actions are taken against anyone who conceals or destroys evidences relatedto protected disclosures made under this mechanism. The company has adopted a policy onwhistle blower and vigil mechanism where the policy also provides for direct access to thechairperson of the Audit Committee in appropriate or exceptional cases. The policy onwhistle blower and vigil mechanism is also uploaded on the company's websitewww.bemcohydraulics.net

17. SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:

No regulatory authority has passed any orders having material impact on the Company.

18. DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS

There are sound internal controls commensurate with nature and size of the Company thathave been incorporated in the Policy to detect the financial discrepancies well in time.Key policies are defined understood and enforced. Operating procedures are clearlydefined; detailed and harmonized procedures are available across the organization. Severalcontrols are preventive in nature and automated. All stakeholders are aware of their rolesand responsibilities with respect to processes and controls. The culture of compliancewith laid down guidelines and procedures is evident through the actions and behavior ofindividuals and teams. The Management Information System ensures that adequate andaccurate information is available for reporting and decision making. The Audit committeealso evaluates the operating effectiveness of Internal Financial Control systems.

Moreover:

-Internal Audit is carried out at regular intervals by an Independent CharteredAccountant who submits his report to the Audit Committee and Board -Statutory Auditorscarry out the verification of Books on every Quarter before submitting their LimitedReview Report Board is prompt in maintaining the adequacy of Internal Financial Controlswith reference to the Financial Statements

19. LISTING WITH STOCK EXCHANGE:

The Company has paid the Annual Listing Fees for the year 2017-18 to Bombay StockExchange where the Company's Shares are listed.

Place : Belgaum M.M. MOHTA ANIRUDH MOHTA
Date : 18-08-2017 Chairman Managing Director
DIN-00068884 DIN-00065302
2 Mohanam 10th Cross Bhagya Nagar Belgaum 590006 Karnataka. 2 Mohanam 10th Cross Bhagya Nagar Belgaum 590006 Karnataka.