Your Directors are pleased to present the 34th Annual Report of the Companytogether with its Audited Financial Statements for the year ended 31st March2018.
1. FINANCIAL AND OPERATIONAL RESULTS: A. Financial Results (Standalone):
Financial and Operational Results of the Company for the Financial Year ended 31stMarch 2018 as compared to the previous financial year is summarized as hereinbelow :
| || ||(Rs. In Lakhs) |
|Particulars ||Current Financial Year ended on 31.03.2018 ||Previous Financial Year ended on 31.03.2017 |
|Gross Sales/ Income from Operations ||120455.38 ||70408.67 |
|Less- GST ||14572.25 ||- |
|Total Operational Revenue ||105883.13 ||70408.67 |
|Other Income ||1369.58 ||844.11 |
|Total Income ||107252.71 ||71252.78 |
|EBITDA ||16812.40 ||7195.05 |
|Less: (i) Finance Cost ||773.89 ||979.56 |
|(ii) Depreciation and Amortization ||607.03 ||541.93 |
|Profit Before Tax (PBT) ||15431.48 ||5673.56 |
|Provision for tax (including Deferred Tax) ||5467.55 ||2110.52 |
|Profit from Continuing Operations after Tax (PAT) ||9963.93 ||3563.03 |
|Other Comprehensive Income ||(-)22.40 ||(-)56.10 |
|Total Comprehensive Income for the Year ||9941.53 ||3506.93 |
|Net Worth ||25813.16 ||16270.99 |
|Amount Transferred to Reserves ||NIL ||NIL |
|E.P.S (Equity Share of Rs. One each) 6.01 2.15 |
B. Financial Results(Consolidated):
The Consolidated Financial and Operational Results of the Company for the year ended 31stMarch 2018 as compared to the previous financial year is summarized as hereinbelow:
| || ||(Rs. In Lakhs) |
|Particulars ||Current Financial Year ended on 31.03.2018 ||Previous Financial Year ended on 31.03.2017 |
|Gross Sales/ Income from Operations ||120455.38 ||70408.67 |
|Less- GST ||14572.25 ||- |
|Total Operational Revenue ||105883.13 ||70408.67 |
|Other Income ||1369.58 ||844.11 |
|Total Income ||107252.71 ||71252.79 |
|Profit Before Tax (PBT) ||15431.48 ||5673.57 |
|Add- Share of Net Profit of Joint Venture Company accounted for using the equity method ||38.73 ||(-)17.74 |
|Consolidated Profit Before Tax (PBT) ||15470.21 ||5655.83 |
|Provision for tax (including Deferred Tax) ||5467.55 ||2110.53 |
|Profit from Continuing Operations after Tax (PAT) ||10002.66 ||3545.29 |
|Other Comprehensive Income ||(-)22.40 ||(-)56.10 |
|Total Comprehensive Income for the Year ||9980.26 ||3489.19 |
|Amount Transferred to Reserves ||NIL ||NIL |
|E.P.S (Equity Share of Rs. One each) ||6.03 ||2.14 |
C. OPERATIONS AND FUTURE PLAN: OPERATIONS:
(a) The results achieved in the year 2017-18 depict profound improvement over theprevious year as was envisaged and as may be observed from the relevant texts reproducedhereunder:
Extract from the Board's Report of Fiscal 2017:
"Ipso facto improving upon the results achieved in 2016-17 is likely to be farmore impressive in the F.Y. 2017-18 and definitely thereafter in the subsequentyears".
(b) Indeed the company could achieve stunning performance in the fiscal 2018 as isevident from the following results:
Sales Volume: Sales volume increased from 50732 MT (2016-17) to 66016MT (2017-18) - an increase of 30.12%.
Sales Turnover: Sales turnover of goods manufactured increased from Rs.619.33 Crores (2016-17) to Rs. 922.13 Crores (2017-18) - an increase of 48.89%.
EBITDA: Earnings before Interest Tax Depreciation and Amortization(EBITDA) increased from Rs.71.95 Crores (2016-17) to Rs.168.12 Crores (2017-18) - anincrease of 133.66%.
PBT: Profit Before Tax increased from Rs. 56.73 Crores (2016-17) to Rs.154.31 Crores (2017-18) - an increase of 172.01%. (includes trading profit).
PAT: Profit After Tax increased from Rs. 35.63 Crores (2016-17) to Rs.99.64 Crores (2017-18) - an increase of 179.65%.
EPS: Earning per Share increased from Rs. 2.15 (2016-17) to Rs. 6.01(2017-18) - an increase of 179.53%.
Return on Net Worth: Return on Net Worth increased from 21.55% (2016-17)to 38.51% (2017-18)
Return on Investment: Return on Investment increased from 8.25% (2016-17)to 22.86% (2017-18)
(c) The aforesaid magnificent results could be produced owing to the business approachadopted by your company to reorient its marketing strategy by positioning its products inhighly remunerative ABS consuming segments. As a result of the aforesaid business approachadopted by your company the Economic Value Addition (EVA i.e. Sales RevenueCost ofMaterial) at Rs. 287.64 Crores (2017-18) shows an enhancement of Rs. 128.34 Crores againstthe previous year's EVA at Rs. 153.50 Crores- an increase of 87.38%.
(d) Simultaneously expenditure was kept under tight leash resulting in maintaining thelevel of expense in the year under review at Rs. 20900 per unit volume of sales excludingdebtor's write-off at Rs. 8.56 Crores-Rotomac Group and Forex loss of Rs.6.82 Crores inthe last quarter of fiscal 2018. This is against previous year's level of expense at Rs.20700 per unit volume of sales. It is noteworthy due to prevailing inflationary conditionin the Indian economy.
(e) The stakeholders of the company will be delighted to observe the Balance Sheet asat 31.03.2018 on account of the following facts:
Net Worth: Net worth of the company is Rs. 258.13 Crores in the yearunder review against the previous year at Rs. 162.71 Crores - an increase by 58.64%.
Book Value of the Equity share: The corresponding increase in the bookvalue of the equity share of the company (with the Face Value of Rs. 1/- per share) is atRs. 15.56 in the year under review against the previous year at Rs. 9.81 - an equatedincrease by 58.61%.
Current Ratio: Current Ratio (Current Assets/Current Liabilities) as on31.03.2018 is 2.04 against 1.30 as on 31.03.2017.
TOL/TON: Financial health gained in the year under review resulted inhighly favourable ratio of Total Liability to Total Net worth at 0.63 against previousyear's ratio of 1.59
Zero Debt: The company has been debt free (long term debt) ever sincefiscal 2003 and now it has become a zero debt company i.e. no borrowing at all. This isin view of the fact that the company has repaid all its dues to its working capitalsolitary banker Allahabad Bank who had lent fund and non-fund based working capitalfacility to the company amounting to Rs. 216.50 Crores. Consequent thereupon AllahabadBank has vacated their charge on the entire fixed and movable assets of the company whichwas created through equitable mortgage and Deed of Hypothecation. Consequently the sharespledged by the Promoter and Promoter Group Companies in favour of Allahabad Bank and thepersonal guarantee of Mr. B. M. Bhansali Promoter and Managing Director have beenreleased.
Financing Pattern: Without resorting to any external borrowing thecompany would be able to sustain its operations based on the handsome internal accruals.
Sales Credit Control: Company's sales credit control policy in respect ofthe supply effected to the esteemed patrons has also shown good effect since debtorspercentage of sales has reduced to 15.39% as on 31.03.2018 against 19.42% as on31.03.2017. Consequent whereupon the debtors' age has reduced from 80 days to 60 days.(f) As aforesaid continuance of the sales credit control policy and handsome internalaccruals will not only provide sufficient liquidity to the company but would also enableit to largely fund its long term CAPEX requirement in respect of its ensuing capacityaugmentation program details whereof have been adequately dealt with in the later textcaptioned as "Future Expansion".
A) Expansion from 80 KTPA to 137 KTPA:
a) In the text of Board's Report of fiscal 2017 we had highlighted the expansionprogram to ramp up the ABS capacity to 137 KTPA by 31.12.2018. This program is beingimplemented in two phases i.e 80 KTPA to 100 KTPA by 31.03.2018 and thereafter from 100KTPA to 137 KTPA by 31.12.2018. The company has already communicated to BSE/NSE videletter dtd. 4th April 2018 that the ABS capacity expansion plan of the company from 80KTPA to 100 KTPA at its Abu Road unit has been successfully implemented within theenvisaged cost and time frame i.e. Rs. 20 crores and 31st March 2018 respectively.
b) Furthermore concerted efforts are being directed to expand ABS compounding capacityto 137 KTPA within the envisaged time and cost schedule i.e. Rs. 30 crores and 31stDecember 2018 respectively.
c) The R&D Centre at Aburoad unit being set up at an estimated cost of Rs. 20Crores will be operational by 30th September 2018. This will revitalize themarket development efforts as the R&D Centre is being equipped with state-of-the-artrecipe development and testing facilities viz. recipe development:- Lab Extruders (2nos.) Moulding machines (3 nos.) Digital Microscope Fourier Transform Infra-RedSpectrophotometer and Colour Spectrophotometer etc. Testing facilities:- Weather MeterGas Chromatograph Charpy Impact Tester HDT Tester MFR Tester Universal Testing Machineand DuPont Impact Tester etc.
d) Since company has established a JV with Nippon A&L (NAL) Japan 5 years ago andtheir process and R & D experts are head quartered in India for extending full supportto BEPL the new R&D Centre will function under technical guidance of these Japaneseexperts and if required additional manpower will be deployed by NAL to back up BEPL's R& D efforts under the technical assistance agreement executed between BEPL and NAL.
e) Therefore R&D Centre at Aburoad unit will enable BEPL to gradually increase themarket share of speciality ABS grades and through niche marketing efforts BEPL willconcentrate on highly remunerative ABS market segment by decreasing sale of GeneralPurpose (GP) grades and increasing sale of speciality grades.
B) Port Based Greenfield Project of 200 KTPA capacity:
a) As was covered in the text of Board Report of fiscal 2017 dealing with the subjectof future expansion we are pleased to inform that after in-depth evaluation ofalternative ports in Gujarat Pipavav port has been selected as a location to set up theproposed port based green-field project of 200 KTPA capacity. In this connection twoalternative land parcels have been identified at Pipavav port and due diligence in respectof the first choice of land parcel is being presently carried out and hopefully will becompleted by 15th May 2018. This land parcel is available for disposal by ascheduled private bank. The other alternative land parcel is available with Govt. ofGujarat. The first land parcel is located within 3.3 kms. from the APM Terminal's liquidjetty and the other land parcel referred to herein above is located at 6.5 kms. from theAPM Terminal's liquid jetty.
b) From the technical feasibility angle in terms of transporting liquid cargo ofStyrene Acrylonitrile monomers and liquified Butadiene monomer through pipeline both theland parcels are selectable.
c) The proposed new plant will be based on state-of-the-art technology as has beenamply covered in the text of Board Report of Fiscal 2017 and in view of the relevance andvalidity thereof the appropriate text is being reproduced hereinbelow:
Extract from the appropriate text of the Board Report - Fiscal 2017:
The new plant will be based on the state of the art technology from Japan and in thisconnection the substantive initial steps have already been taken involving several roundof meetings with the Japanese company followed by visit of their experts. This Japanesecompany is none-else than Nippon A&L Japan with whom the company has a long standingrelationship and also established marketing joint venture in the year 2013 who areproviding sales support as well as technical support with respect to the existingoperations of JV products.
Furthermore infrastructure development work is progressing rapidly in terms of stepsbeing taken by your Company for acquisition of land and planning of captive power plant asan integral part of the expansion programme. Based on the encouragement being receivedfrom the concerned authorities of the state government and company's technology partnerthe implementation programme has been firmed up to commence manufacturing of ABS from theproposed port based green-field plant by 31st March 2022.
Perception backed up by conviction of the Company is that by the time the new 200 KTPAport based plant is established; the company will be able to exploit its capacity of theplant optimally. This is because your Company is likely to have captured the largestmarket share of ABS in India. Moreover based on the competitive cost structure andquality wise at par with the best in the world if required your company will be in aposition to export specialty grades of the ABS ASA and AES resins as well.
The aforesaid strategy will ensure birth of a healthy baby thwarting all threats andlimitations which is often faced by any greenfield project as it is otherwise difficult tomaintain the economic viability in the initial years of production due to relatively lowercapacity utilization resulting in not being able to achieve breakeven level of the outputwhich certainly will not be the situation to be faced by your company.
Moreover implementation of the project takes into account in terms of the technologyselection and logistic planning that it remains globally competitive in the event theIndian economy opens up further and custom tariff barriers is done away with.
In this context energy conservation and minimizing environmental affects are given dueimpetus. Furthermore automation and safety measures are no less area of attention forimplementing the project based on ultramodern process technology. Due care is being takento ensure that the material handling system is carried out with least human involvement toimprove upon the safety and avoid human errors.
2. REPORT ON PERFORMANCE OF SUBSIDIARIES ASSOCIATES AND JOINT VENTURECOMPANIES:
Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014 your Company did not have any subsidiary Company during F.Y.2017-18; however it has one Joint Venture/ Associate Company viz. Bhansali Nippon A&LPrivate Limited having its Registered Office at 401 4th Floor PeninsulaHeightsC. D. Barfiwala Road Andheri (West)Mumbai - 400 058 wherein the Company holds50% of the paid up equity share capital.
The Report on the performance and Statement containing salient feature of FinancialStatements of aforesaid Joint Venture / Associate Company is separately attached in FormNo. AOC-1 with this Annual Report. In accordance with Section 136 of the Companies Act2013 the Financial Statements of the Company including the Consolidated FinancialStatements pertaining to its aforesaid Joint Venture entity are available on the Company'swebsite (www.bhansaliabs.com).
Your Directors considering stupendous growth in total comprehensive income viz. by183.48 % during F.Y. 2017-18 as against the last fiscal have recommended final dividend @30% on the nominal value of the total paid-up equity share capital of Company consistingof 165905640 equity shares with the face value of Rs. 1/- each (viz. dividend of Thirtypaise per equity share) for the financial year ended 31st March 2018 which isan increase of 50% in the dividend rate(s) declared by the Company for last fiscal. Theaforesaid dividend if approved by members in ensuing Annual General Meeting will bedistributed out of the net profits of the Company available for distribution of dividends.
4. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report for the year under review as requiredpursuant to the provisions of Regulation 34(2)(e) read with Schedule V(B) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed herewith vide Annexure- I and forms an integral part of this Report.
5. BUSINESS RESPONSIBILITY REPORT:
Pursuant to regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 top 500 listed companies by market capitalization calculated as onMarch 31 of every financial year are required to include in their Annual Report aBusiness Responsibility Report describing therein the initiatives taken by them fromenvironmental social and governance perspectives in the format prescribed by SEBI. Sincethe company for very first time from its inception entered into the category of top 500Listed companies of India by way of its market capitalization for the financial year ended31-03-2018 it has presented its Business Responsibility Report. In its quest of greeninitiative the Company has hosted the Business Responsibility Report on its website -www.bhansaliabs.com. On request a physical copy of said Report would be made available.
6. DIVIDEND DISTRIBUTION POLICY:
The Dividend Distribution Policy became applicable to the company pursuant toRegulation 43(A)(1) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015; because for very first time since inception it entered into thecategory of top 500 Listed companies of India by way of its market capitalization for thefinancial year ended 31-03-2018. Therefore the Company has formulated its DividendDistribution Policy considering the parameters as mandated in the said Listing Regulationsand is available on the website of the company viz. www.bhansaliabs.com
7. INTERNAL FINANCIAL CONTROL SYSTEM OF THE COMPANY:
Adequate Internal Financial Control systems commensurate with the nature of theCompany's business size and complexity of its operations are in place and have beenoperating satisfactorily and effectively. During the year no material weaknesses in thedesign or operation of Internal Financial Control system was reported.
8. PARTICULARS OF CONTRACT(S)/TRANSACTION(S)/ARRANGEMENT(S) WITH RELATEDPARTIES:
The Related Party Contract(s)/Transaction(s)/Arrangement(s) entered into by the Companyduring F.Y. 2017-18 were in its ordinary course of business and on an arm's length basis.Hence Form AOC-2 is not applicable to the Company. Further pursuant to the provisions ofregulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015there were no materially significant related party contract(s)/transaction(s)/arrangements entered into by the Company with the Related Party(ies) whichmay have a potential conflict with the interest of the Company. All related partytransaction(s) are first placed before Audit Committee for their consideration and makingrecommendation to the Board and thereafter such transactions are placed before the Boardfor seeking their approval wherever required.
The details of Related Party Transactions (RPTs) in consonance with the provisions ofthe respective Accounting Standards have been stated in Note No. 39 to the StandaloneAudited Financial Statements of Company forming part of this Annual Report.
The Policy of Company on dealing with the Related Party Transactions has been placed onthe Company's website and can be accessed at www.bhansaliabs.com.
9. PARTICULARS OF LOANS ADVANCES & GUARANTEES GIVEN AND INVESTMENTS MADE ORSECURITIES PROVIDED AS PER SECTION 186 OF THE COMPANIES ACT 2013:
Particulars of Loans Advances and Investments made by the Company during the financialyear 2017-18 are stated in Note No. 5 and 6 to Standalone Audited Financial Statements ofCompany as annexed to this Annual Report. The Company has neither made any investment norprovided any guarantee or security for any loan during the reporting period.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMPs):
There was no change in the KMPs and composition of the Board of Directors during thereporting period. However the Board has recommended for the re-appointment of Mr JayeshB. Bhansali (DIN: 01062853) as Executive Director & CFO of the Company for furtherperiod of 3 years w.e.f. 1st April 2018 on the existing remuneration terms& conditions considering the recommendation made by the Nomination and RemunerationCommittee of the Company at their meeting held on 10th March 2018. Necessaryinformation including the applicable terms and conditions and the proposed remunerationhas been provided in the said Resolution and the explanatory statement thereof formingpart of the Notice convening the AGM.
Mr. B. M. Bhansali (DIN: 00102930) Managing Director of the Company shall retire byrotation at the ensuing Annual General Meeting and being eligible has offered himself forre-appointment.
a. DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received declaration from all the Independent Directors of Companyconfirming that they meet with the criteria of Independence as prescribed pursuant to theprovisions of Section 149(6) of the Companies Act 2013 and Regulation 16(1)(b) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
b. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Company has formulated a Programme for Familiarization of Independent Directorswith regard to their roles rights responsibilities in the Company nature of theindustry in which the Company operates the business model of the Company etc. The detailsof the Familiarization Programmes as conducted by the Company last time are available onthe website of the Company (www.bhansaliabs.com). However during the year under reviewthere was no change in the nature of business of the company and its business vertical/structure/ operational strategy etc. which would have necessitated a freshFamiliarization Programme for Independent Directors. Further with respect to thecompliances of various acts and regulations applicable to the Company the familiarisationprogramme is held at the Board Meeting(s) whenever required.
11. DISCLOSURES RELATED TO BOARD AND CORPORATE GOVERNANCE REPORT ETC:
a. NUMBER OF MEETINGS OF THE BOARD:
The Board met 4 (Four) times during financial year 2017-18 viz. 16th April2017; 14th July 2017; 13th October 2017 and 14th January2018. The detailed information with regard to the Composition of Board and itsCommittee(s) and their respective meetings etc. are stated in the Corporate GovernanceReport of Company for sake of brevity which forms part of this Annual Report.
b. CORPORATE GOVERNANCE:
The Company is committed to maintain the highest standards of Corporate Governance andadheres to its requisites as set out by the respective authorities. The report onCorporate Governance as stipulated under Regulation 34 read with Schedule V(C) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is annexed herewithvide Annexure II and forms an integral part of this Annual Report.
The requisite certificate from the Practising Company Secretary viz. SecretarialAuditors of the Company M/s Rathi & Associates confirming compliance with theconditions of Corporate Governance as stipulated in Part E of Schedule V to the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is appended herewithvide Annexure II A and forms an integral part of this Annual Report.
Certificate issued by the Managing Director and Executive Director Cum CFO of theCompany with regard to the certification on Audited Financial Statements of the Companyfor financial year 2017-18 is also annexed herewith vide Annexure II B and forms anintegral part of this Annual Report.
The Company has suitably laid down the Code of Conduct for all Board Members and SeniorManagement personnel of the Company in accordance with the provisions of Regulation 17(5)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and the saidCode is also available on the website of the Company (www. bhansaliabs.com). Thedeclaration by CEO i.e. Managing Director of Company related to the compliance ofaforesaid Code of Conduct is also attached herewith vide Annexure II C and forms anintegral part of this Annual Report.
12. COMPANY POLICIES:
In accordance with the provisions of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and the Companies Act 2013 the Company has formulatedand implemented the following policies. All the Policies are available on Company'swebsite (www.bhansaliabs.com) under the caption (Investors) and its sub-caption (Policiesand Procedures) The policies are reviewed periodically by the Board and are updated basedon need and requirements arising from time to time.
|Name of the Policy ||Brief Description |
|Whistle Blower or Vigil Mechanism Policy ||The Policy is meant for Directors Stakeholders and Employees etc. of the Company to report their concerns if any about unethical behavior actual or suspected fraud or violation of the Company's code of conduct and ethics. |
|Policy for Related Party Transactions ||The Policy regulates all transactions taking place between the Company and its related parties in accordance with the applicable provisions. |
|Policy for Preservation of Documents ||The Policy deals with the system of retention of Corporate records of the Company. |
|Policy for Determination of Materiality of Events ||The Policy applies for determining and disclosures of material events taking place in the Company from time to time. |
|Archival Policy ||The Policy deals with the retention and archival of corporate records of the Company for a particular period as may be applicable on basis of its policy. |
|Code of Conduct for Director(s) and Senior Management Personnel ||The Policy is aimed to formulate a Code of Conduct for the Directors and Senior Management Personnel of Company to establish highest standard of their ethical moral and legal conduct in the business affairs. |
|Nomination and Remuneration Policy ||The Policy formulates the criteria for determining qualifications/ competencies/ positive attributes and independence for the appointment of Director (Executive / Non-Executive) and also the criteria for determining the remuneration of the Directors Key Managerial Personnel (KMPs) and other employees covered under the prescribed criteria if any. |
|Corporate Social Responsibility Policy ||The Policy outlines the Company's strategy to bring about a positive impact on society through its activities/ programmes relating to Health Education Social welfare activities Hunger eradication Environmental Sustainability Promoting Gender Equality Upliftment of deserving deprived and underprivileged sections of society and Promotion of Sports Arts & Culture etc. |
|Code of Conduct for Prohibition of Insider Trading ||The Policy provides framework for dealing with the securities of Company by the Insiders of Company in mandated manner. |
|Code for Independent Directors ||The Code is a guide to professional conduct for Independent Directors. Adherence to these standards by Independent Directors and fulfillment of their responsibilities in a professional and faithful manner will promote confidence of the investing community particularly minority shareholders regulators and companies in the institution of Independent Directors. |
|Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI) ||Regulation 8 of the SEBI (Prohibition of Insider Trading) Regulations 2015 requires a listed company to formulate and publish a policy on its official website viz. "Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information" which shall adhere to each of the principles as set out in schedule A to the said Regulation. |
|Policies related to Business Responsibility Report (BRR) : ||In compliance with Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the company being one of the top five hundred listed companies as on 31.03.2018 the Nine polices related |
|1) Ethics Transparency and Accountability ||to BRR have been formulated by the management. |
|2) Product Life Cycle Sustainability || |
|3) Employee Well being ||The key objective of these policies is to re-affirm the Company's commitment to follow the principles laid down in National Voluntary Guidelines (NVGs) on Social Environmental and Economic perspectives/responsibilities of Businesses. These policies will help the company to deal with the complexities and challenges that keep emerging in the conduct of its business. |
|4) Stakeholders Engagement || |
|5) Human Rights || |
|6) Environment || |
|7) Policy Advocacy || |
|8) Inclusive Growth and Equitable Development || |
|9) Consumer Value || |
|10) Dividend Distribution Policy ||In compliance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 The Dividend Distribution Policy of Company has been formulated by the management. |
13. CORPORATE SOCIAL RESPONSIBILITY (CSR):
The Company is conscious of its responsibility towards the society as a corporatecitizen. During the F.Y. 2017-18 the Company was required to spend a total amount of Rs.58.64 Lakh towards its CSR activities which has been entirely spent within the F.Y.2017-18 itself towards Educational/Skill development programmes/social welfare activitiesfor general public/ creating permanent infrastructure pertinent thereto/trainingprogrammes and promotion of Education Art and Culture etc.
The Company's CSR Policy Statement and Annual Report on the CSR activates undertakenduring the financial year ended 31st March 2018 in accordance with Section135 of the Companies Act 2013 and the Companies (Corporate Social Responsibility Policy)Rules 2014 (including any statutory modification(s) or re-enactment(s) thereof for thetime being in force) is annexed herewith vide Annexure III and forms an integralpart of this Report.
14. COMMITTEES OF THE BOARD OF DIRECTORS:
The details with respect to the Committees of Board of Directors of Company viz. AuditCommittee Nomination and Remuneration Committee Stakeholders Relationship CommitteeCorporate Social Responsibility Committee and Investment and Loan Committee for the sakeof brevity have been stated in the Corporate Governance Report of the Company formingintegral part of this Annual Report.
15. PERFORMANCE EVALUATION OF THE BOARD AND IT'S COMMITTEE(S):
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 (10) of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and otherapplicable provisions thereto; the Board carried out annual evaluation of each of thedirectors of the Company individually (considering the various relevant aspects of thefunctioning of the Board including their composition and adequacy etc.) cultureexecution performance obligations governance contribution and quality of participationin the Board and committee proceedings etc. The Committees of Board were also evaluated bythe Board of Directors and their functionings were found satisfactory.
The Performance evaluation of the Independent Directors was done by the entire Board ofDirectors sans the participation of the Director being evaluated. The performanceevaluation of the Chairman Managing Director & Executive Director was carried out bythe Independent Directors. The Board of Directors expressed their satisfaction with theevaluation process.
16. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Pursuant to the provisions of Section 197(12) of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 therequisite details are annexed herewith vide Annexure IV and forms an integral partof this Report and are also available at the Registered Office of the Company forinspection during its business hours upto the date of AGM and any member interested inobtaining such information may directly write to the Company Secretary of the Company andthe same shall be provided on such request.
17. ADOPTION OF INDIAN ACCOUNTING STANDARDS (Ind AS)
The Company has adopted Ind AS with effect from 1st April 2017 with atransition date of 1st April 2016 pursuant to the Ministry of CorporateAffairs notification no. G.S.R. 111(E) dated 16th February 2015 notifying theCompanies (Indian Accounting Standards) Rules 2015.
Accordingly the financial statements for the year ended 31st March 2018have been prepared in accordance with the Companies (Indian Accounting Standards) Rules2015 prescribed under section 133 of the Companies Act 2013 and other recognizedaccounting practices and policies to the extent applicable thereto.
18. AUDITORS AND THEIR REPORTS:
The matters related to Auditors and their Reports are as under: a. STATUTORYAUDITOR:
At the 33rd AGM of the Company held on 15-07-2017 M/s Azad Jain &Company Chartered Accountants Mumbai (FRN-006251C) were appointed its Statutory Auditorfor a period of 5 years pursuant to the provisions of section 139 of the Companies Act2013 subject to ratification of their re-appointment in each ensuing AGM. As per therespective provisions in force their re-appointment is within the prescribed limit andthey are also not disqualified under section 141 of the Companies Act 2013.
Further pursuant to the provisions of sections 142 of the Companies Act 2013 theproposal is put up for approval of members to authorize Board of Directors of the Companyto fix their remuneration for F.Y. 2018-19. In accordance with the requirement of SEBI(LODR) Regulations 2015 the Auditors have also confirmed that they hold validcertificate issued by the Peer Review Board of the Institute of Chartered Accountants ofIndia.
No frauds have been reported by the Statutory Auditors during F.Y. 2017-18 pursuant tothe provisions of section 143(12) of the Companies Act 2013.
In view of above necessary resolution for ratification of appointment of the saidAuditor has been included in the notice of AGM for seeking approval of members.
b. AUDIT REPORT:
The observations made by the Statutory Auditor in their Audit Report read with therelevant notes thereof as stated in the Notes to the Audited Financial Statements of theCompany for the Financial Year ended 31st March 2018 are self explanatory andbeing devoid of any reservation(s) qualification(s) or adverse remark(s) etc do not callfor any further information(s)/ explanation(s) or comments from the Board under Section134(3)(f)(i) of the Companies Act 2013.
c. SECRETARIAL AUDITORS:
In terms of the provisions of Section 204 of the Companies Act 2013 M/s Rathi andAssociates Practicing Company Secretaries Mumbai have been re-appointed by the Board asSecretarial Auditors of Company for the F.Y. 2018-19.
d. SECRETARIAL AUDIT REPORT:
Secretarial Audit Report as issued by the Secretarial Auditors in Form No. MR-3 forF.Y. 2017-18 is annexed herewith vide Annexure V and forms integral part of thisReport. The said Secretarial Audit Report being devoid of any reservation(s) adverseremark(s) and qualification(s) etc. does not call for any further explanation(s)/information or comment(s) from the Board under Section 134(3) (f)(ii) of the CompaniesAct 2013.
e. COST AUDITORS:
Pursuant to the provisions of Section 148 and other applicable provisions if any ofthe Companies Act 2013 the Board has approved the re-appointment of M/s Joshi Apte &Associates Cost Accountants Pune (Firm Registration No. 000240) as Cost Auditors of theCompany for carrying out its cost audit for F.Y. 2018-19 for an Annual Audit Fee/Remuneration of Rs. 75000/- (Seventy Five Thousand only ) plus applicable GovernmentTaxes thereon and reimbursement of travelling and actual out of pocket expenses incurredin relation to performance of their duties.
Necessary resolution for ratification of remuneration payable to the Cost Auditors isincluded in the Notice of ensuing AGM for seeking approval of members.
19. COMPLIANCE OF SECRETARIAL STANDARDS:
All the requirements related to Secretarial Standards as applicable to Company fromtime to time have been complied with accordingly.
20. CHANGE IN SITUATION OF THE REGISTERED OFFICE OF THE COMPANY:
The Registered office of the Company was shifted from Bhansali House A - 5 Off VeeraDesai Road Andheri (West) Mumbai 400053 to 401 4th Floor PeninsulaHeights C. D. Barfiwala Road Andheri (West) Mumbai 400058 w.e.f. 20th April2017.
21. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 are furnished as hereunder:-a. EXTRACT OF ANNUALRETURN:
Pursuant to the provisions of Section 92(3) of the Companies Act 2013 read with theCompanies (Management and Administration) Rules 2014 the extract of Annual Return of theCompany in Form MGT-9 is annexed herewith vide Annexure VI and forms an integralpart of this Report.
b. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
The particulars as required pursuant to the provisions of Section 134(3)(m) of theCompanies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 with respectto conservation of energy technology absorption foreign exchange earnings and outgo etc.are annexed herewith vide Annexure VII and forms integral part of this Report.
22. GENERAL DISCLOSURES:
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions/ activities pertaining to these mattersduring F.Y. 2017-18:
a. Details relating to deposits covered under Chapter V of the Companies Act 2013. b.Issue of equity shares with differential rights as to dividend voting or otherwise. c.Issue of shares (including sweat equity shares and ESOP) to employees of the Company underany scheme. d. Instances with respect to voting rights not exercised directly by theemployees of Company.
Your Directors further state that during F.Y. 2017-18:-
i Neither the Managing Director nor the Executive Director cum CFO of the Companyreceive any remuneration or commission from any other company. ii No significant ormaterial orders were passed by the Regulators or Courts or Tribunals which can impact thegoing concern status and the Company's operations in future. iii There has been no changein the nature of business of the Company. iv Pursuant to the provisions of SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 nocase pertaining to sexual harassment at workplace has been reported to the Company. vThere was no revision of the Financial Statements of the Company. vi No fraud has beenreported by the Auditors in their Audit Report hence the disclosure u/s 134(3) (ca) is notapplicable. vii The Company has not identified any such risk which can potentiallythreaten its existence.
23. DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act 2013 ("the Act") and inrelation to the Audited Annual Financial Statements of the Company for the year ended 31stMarch 2018 the Board of Directors hereby confirm that:
a. in the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed along with proper explanation relating to material departures; b. suchaccounting policies have been selected and applied consistently and the Directors havemade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2018 and of theprofit of the Company for that year; c. proper and sufficient care was taken for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; d. the annual accounts of the Company have been prepared on a goingconcern basis; e. Internal Financial Controls have been laid down to be followed by theCompany and that such Internal Financial Controls are adequate and were operatingeffectively; and f. Proper systems have been devised to ensure compliance with theprovisions of laws applicable to the Company and that such systems were adequate andoperating effectively.
24. ACKNOWLEDGEMENT AND APPRECIATION:
Your Directors would like to place on record their appreciation for the assistancecoordination and cooperation received from the Banks Government Statutory AuthoritiesCustomers Vendors and all Stakeholders of the Company who extended their constantpatronage and support to the Company in its endeavour of consistent growth.
Your Directors would like to express their deep-appreciation to the employees for theirresilience hard work dedication sincerity and relentless efforts which contributed tothe stupendous growth and impressive performance of the Company during F. Y. 2017-18.
| ||For and on Behalf of the Board of Directors |
| ||M. C. Gupta |
| ||Chairman |
| ||(DIN: 01362556) |
|Place : Mumbai || |
|Date :13th April 2018 || |
|Registered Office Address: || |
|401 4th Floor Peninsula Heights || |
|C D Barfiwala Road || |
|Andheri (West) Mumbai-400058. || |
|CIN: L27100MH1984PLC032637 || |
|Tel No. : 022 - 2621 6060 || |
|Fax No. : 022 - 2621 6077 || |
|E-Mail: email@example.com || |
|website: www.bhansaliabs.com || |
Annexure - IV
PART - A: DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OF THECOMPANIES ACT 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OFMANAGERIAL PERSONNEL) RULES 2014.
(i) The percentage increase in remuneration of each Director Chief Financial Officer(CFO) and Company Secretary during the financial year 2017-18 ratio of the remunerationof each Director to the median remuneration of the employees of the Company for thefinancial year 2017-18 and the comparison of remuneration of each Key Managerial Personnel(KMP) against the performance of the Company are as under:
|SN ||Name of Director/ KMP and Designation ||Remuneration of Director(s)/ KMPs for the Financial Year 2017-18 (in Rs.) ||% increase in the Remuneration in the Financial year 2017-18 ||Ratio of remuneration of each Director to median remuneration of the employees |
|1. ||Mr. B. M. Bhansali (Managing Director) ||77148599.00 ||176.10% ||347.38 |
|2. ||Mr. Jayesh B. Bhansali (Executive Director & CFO) ||77148599.00 ||1185.81% ||347.38 |
|3. ||Mr. M. C. Gupta (Chairman & Independent Director) ||300000.00 ||62.16% ||1.35 |
|4. ||Dr. B. S. Bhesania (Independent Director) ||360000.00 ||44.00% ||1.62 |
|5. ||Mr. Dilip Kumar (Independent Director) ||150000.00 ||15.38% ||0.68 |
|6. ||Ms. Jasmine F. Batliwalla (Independent Director) ||140000.00 ||21.74% ||0.63 |
|7. ||Mr. D. N. Mishra [G.M. (Legal) & Company Secretary] ||3980492.20 ||2.41% ||17.92 |
1. The remuneration of Directors includes sitting fees paid to them for the financialyear 2017-18.
2. The percentage increase in Independent Director's remuneration is based on theirattendance in the Board and Committee Meetings held during the financial year.
(ii) The median remuneration of employees of the Company (including KMPs) during thefinancial year 2017-18 was Rs. 222090/-per annum;
(iii) In the financial year 2017-18 there was decrease of (6.92%) in the medianremuneration of employees (including KMPs) due to reduction in the number of employees ascompared with last fiscal;
(iv) There were 456 permanent employees on the rolls of Company as on 31stMarch 2018;
(v) Average percentage increase made in the salaries of employees other than themanagerial personnel in the last financial year i.e. 2017-18 was 11.98% whereas theincrease in the Key Managerial Personnel Remuneration for the same fiscal was 313.56 %considering the outstanding performance as well as Key Responsibility Areas (KRAs) of theKMPs the increase in the remuneration of KMPs is considered appropriate.
(vi) It is hereby affirmed that the remuneration paid is as per the Remuneration Policyof the Company pertaining to its Directors and Key Managerial Personnel (KMPs).
PART - B: PARTICULARS OF EMPLOYEES AS PER SECTION 197(12) OF THE COMPANIES ACT 2013READ WITH RULE 5(2) OF THE COMPANIES
(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014.
a) Disclosure of Top Ten Employees of Company in terms of remuneration drawn and theEmployees employed throughout the Financial Year and in receipt of remuneration of Rs. 102Lakhs or more per annum or Rs. 8.5 Lakhs per Month for part of the year.
|S. No. ||Name of Employee ||Designation ||Remuneration in Fiscal 2018 (In Rs.) ||Nature of Employment (Contractual or otherwise) ||Qualification/ Experience ||Date of Commencement of Employment ||Age ||Last Employment before joining the Company ||% of Equity Share held in Company as on 31.03.2018 ||Whether employee is relative of any Director / Manager and if so name of such Director/ Manager |
|1 ||BABULAL M. BHANSALI ||Managing Director ||77148599.00 ||Regular ||Non-Matriculate (34 Years) ||08-09-84 ||64 ||Bhansali Engineering Polymers Ltd ||16384887 ||Father of Executive Director Cum CFO of Company viz. Mr. Jayesh B. Bhansali |
|2 ||JAYESH B. BHANSALI ||Executive Director Cum CFO ||77148599.00 ||Regular ||M.Com (11 Years) ||24-06-06 ||34 ||Bhansali Engineering Polymers Ltd ||11561945 ||Son of Managing Director of Company viz. Mr. Babulal M. Bhansali |
|3 ||KENJI ASAKAWA ||E.D. (Technical) ||6000000.00 ||Contractual ||B.E. and M.E. (Chemical Engineering) (46 Years) ||06-11-03 ||72 ||Nippon A & L INC. Japan ||NIL ||NO |
|4 ||JUNG REA CHO ||Vice President - Marketing ||4139966.83 ||Regular ||B.E Metallurgy MBA (15 Years) ||04-09-17 ||41 ||Crenova Plating Pvt. Ltd ||NIL ||NO |
|5 ||DEOKI NANDAN MISHRA ||GM(Legal)& Company Secretary ||3980492.20 ||Regular ||FCS ACIS (U.K.) LL.B. MBA (Finance) PGD (IPR) (30 Years) ||07-05-11 ||50 ||Sahara One Media and Entertainment Ltd ||14725 ||NO |
|6 ||MANOJ KUMAR SHARMA ||General Manager (Marketing) ||3610682.00 ||Regular ||B. Tech (Plastics) (27 Year) ||21-12-11 ||50 ||LG Polymers India Pvt. Ltd. ||NIL ||NO |
|7 ||S M GHIKE ||G M (Projects) ||3492329.00 ||Regular ||B.E. (Mechanical) D.M.S. (42 Years) ||15-02-16 ||64 ||ThyssenKrupp Industrial Solutions (India) Pvt. Ltd. ||NIL ||NO |
|8 ||VINEET BANSAL ||Manager - Electrical ||2604389.00 ||Regular ||M.E (Electrical System and Drive) (16 Years) ||10-01-17 ||43 ||SKI Carbon Black Pvt Ltd. Aditya Birla Group Company ||108 ||NO |
|9 ||ARUN KINGAWADEKAR ||Dy. Manager (Marketing) ||2223915.50 ||Regular ||B.A.D.P.A.T. (28 Years) ||01-08-94 ||49 ||Shalimar Paints Ltd ||NIL ||NO |
|10 ||MINESH VINODKUMAR KANOJIA ||Manager - Instrumentation ||2025066.00 ||Regular ||B.E. (Instrumentation & Control) (16 Years) ||22-02-17 ||39 ||Pidilite Industries ||NIL ||NO |
b) None of the employee was in receipt of remuneration amounting to Rs. 8.5 Lakhs permonth or more for part of the year.
c) There were no Employee employed throughout the financial year or part thereof whowas in receipt of remuneration in that year which in the aggregate or as the case maybe at a rate which in the aggregate was in excess of that drawn by the ManagingDirector or Whole Time Director or Manager and who holds by himself or along with hisspouse and dependent children two percent or more of the equity shares of the company.
|Place: Mumbai ||For and on behalf of the Board |
|Date: 13th April 2018 ||M. C. Gupta |
| ||Chairman |
| ||(DIN: 01362556) |
DISCLOSURE PURSUANT TO SECTION 134(3) (m) OF THE COMPANIES ACT 2013 READ WITH RULE 8OF THE
COMPANIES (ACCOUNTS) RULES 2014
(A) Conservation of Energy:
|Steps taken or impact on conservation of energy ||1. In powder plant 5 No of reciprocated air compressors are replaced with 2No screw compressors with VFD facilities. |
| ||2. In powder plant total 134KW of high capacity motors are controlled by VFD instead of throttling valves or dampers. |
| ||3.In powder plant total 57 No of tube type street lights are replaced with LED lamp. |
| ||4. In powder plant by improved maintenance of steam trap and condensate recovery system more condensate is recovered in boiler system. So steam consumption rate is reduced by 81Kg/MT-powder. This means 16 kg of coal consumption per MT powder is reduced. |
| ||5.In powder plant in the area where middle pressure steam is not required low pressure steam is supplied by erecting new pressure reducing system. By this modification steam leakage and passing trouble becomes almost nil. |
| ||6.In SAN & compound plant 5 No of reciprocated air compressors are replaced with 2No of screw compressors with VFD facilities which saves 25KW. |
| ||7.In SAN & Comp plant total 363 No of tube lamps are replaced with LED lamps which can save 5.3 KW. |
|Steps taken by the company for utilizing alternate resources of energy ||NA |
|Capital investment on energy conservation equipment ||Rs. 50 Lacs (Approx) |
|(B) Technology absorption: || |
|Efforts made towards technology absorption ||NA |
|1.Benefits derived like product improvement Cost reduction product development or import substitution ||By various power saving activities power consumption is reduced by 36KHW/MT-powder. |
| ||2. Sub-raw material loading to powder is reduced by process improvement. This resulted in saving of Rs.1500/MT-powder. |
| ||3. By increased SAN output capacity fuel consumption at hot oil heater is reduced by 3Kg/MT-SAN. |
|In case of imported technology (imported during the last three NA years reckoned from beginning of the financial year): || |
|Details of technology imported ||NA |
|Year of import ||NA |
|Whether the technology has been fully absorbed ||NA |
|If not fully absorbed areas where absorption has not taken NA place and the reasons thereof Expenditure incurred on Research and Development NA || |
|Actual Foreign Exchange Earnings & outgo during F.Y. 2017-2018 (in INR) |
|Foreign Exchange earning ||: Rs. NIL |
|Foreign Exchange Outgo ||: Rs. 410.18 Lacs |