You Directors hereby submit the report on Business and Operations along with theAudited Financial Results of the Company for the year ended 31st March 2018.
FINANCIAL HIGHLIGHTS FOR THE YEAR ENDED MARCH 31 2018:
(Rs. in Lakhs)
| ||For the Year |
|Particulars ||2017-18 ||2016-17 |
|Revenue ||6117.54 ||46861.29 |
|Expenditure ||2744.06 ||5301.09 |
|Profit / (Loss) before Depreciation & Tax ||3373.48 ||41560.20 |
|Depreciation ||20.22 ||19.63 |
|Profit / (Loss) before Exceptional item and tax ||3353.26 ||41540.57 |
|Exceptional item ||- ||39.53 |
|Profit / (Loss) before Tax ||3353.26 ||41501.04 |
|Tax ||2699.35 ||13578.98 |
|Profit / (Loss) after Tax ||653.91 ||27922.06 |
|Other comprehensive income/ (loss) ||1.20 ||0.49 |
|Total comprehensive income ||655.11 ||27922.55 |
REVIEW OF OPERATIONS
As reported in the previous year's Directors Report the Company ceased the operationof Container Freight Station (CFS) with effect from May 2012 and since then has beencarrying on the general warehousing operation in the said CFS land with about 120 godowns.
The Board has approved in its Board Meeting held on 1st December 2014 aproposal of the Company for developing an integrated township in the CFS land area of63.89 acres where the general warehousing activity was carried on. Consequently theCompany discontinued the general warehousing operation with effect from 1stJanuary 2015 and all the godowns have been completely vacated in the months ofJanuary/February 2015. Due to the total discontinuance of general warehousing operationsthere is no rental income except a meager amount of Rs.36.36 lakhs as against Rs.12.50lakhs earned in the previous year. The sale of land amounting to Rs.6117.54 lakhsconstitutes major revenue for the year and the Company has reported a profit of Rs.3353.26lakhs before Tax (PBT) during the year.
After adjusting the provision for tax to the tune of Rs.2699.35 lakhs the net profitfor the year is Rs.653.91 lakhs (PAT).
Joint Development Agreement (JDA) With M/s.SPR Construction Pvt. Ltd.
You are aware that the Company is embarked upon development of a World-class IntegratedTownship on Joint Development Model in its main land area of 63.89 acres (previously usedfor CFS operations) at Perambur. For the same the Company has entered into a JointDevelopment Agreement (JDA) on 26.6.2015 on revenue sharing model with M/s. SPRConstruction Private Limited. Chennai.
The mixed use development is the first-of-its-kind township located in a prime locationand is based on the concept of building a destination "Where Business MeetsLife". Planned around combining professional workspaces and living spaces into onegated arena it includes a separate residential development an organized wholesalecenter along with a Retail Mall School Convention Center and Entertainment Area. Thejoint venture between Binny Ltd. and SPR Group believes it can utilize the opportunitypresented by the current physical and social infrastructure bottlenecks faced in Sowcarpet(South India's largest wholesale market) located at just 3 kms from the Project Site. TheSite has easy road access on all four sides and is the only private land of this scale inclose proximity to the city's wholesale markets. The development of the wholesale centeron the site will prove to be an extension/ alternative to the Sowcarpet market and isexpected to become a trading hub not only for the Chennai city but also the entire SouthIndia given its proximity to Chennai Port.
The Project has already received great levels of expression of interest from allquarters. Its residential phase and wholesale market development has already received allthe requisite approvals and RERA registration with other developments expected to obtainthe same in the next few months. The Project shall be developed over a period of 7-9 yearsin a phased manner. Work on the first phase has already begun and is proceeding at asteady pace. Recently the launch of the project's residential towers was met withoverwhelming response from the Chennai community and was successful in selling a recordnumber of units in a short span.
The Company does not recommend any dividend for the year ended March 31 2018
The Company did not invite or accept any deposit during the year under review.
DIRECTORS AND KEY MANAGERIAL PERSONNEL RE-APPOINTMENT OF RETIRING DIRECTOR
Shri. M Nandagopal (DIN: 00058710) Executive Chairman is liable to retire by rotationat the ensuing Annual General Meeting (AGM) pursuant to the provisions of Section 152 (6)of the Companies Act 2013 read with the Companies (Appointment and Qualification ofDirectors) Rules 2014 and the Articles of Association of the Company and being eligiblehas offered himself for reappointment.
Appropriate resolution for his re-appointment is being placed for approval of themembers at the ensuing AGM. The brief resume of the Director and other related informationhas been detailed in the Notice convening the 49th Annual General Meeting ofthe Company.
APPOINTMENT OF DIRECTORS
At the 48th Annual General Meeting held on 29th November 2017Shri. R Arunkumar (DIN:00018588) was appointed as an Independent Director with effect from06th September 2017 for a term of 5 consecutive years upto 05thSeptember 2022 and he is not liable to retire by rotation. During the year Smt. NilimaSathya (DIN:08066913) was appointed as an Additional Director (Independent) of the Companyon 12.02.2018. On the recommendation of the Nomination & Remuneration Committee andwith the approval of the Board Smt. Nilima Sathya (DIN:08066913) is proposed to beappointed as an Independent Woman Director for a period of 5 years with effect from 12thFebruary 2018 and necessary resolution seeking the approval of the members for herappointment is included in the Notice convening the Annual General Meeting. She is notliable to retire by rotation
RESIGNATION OF DIRECTORS
During the year Shri. T Radhakrishnan and Dr. D.V.R. Prakash Rao had resigned from theBoard as Independent Directors on 20.05.2017 and Smt. T Manisriram had resigned from theBoard as Independent Woman Director on 05.10.2017 and the same was accepted by the Board.
Your Directors place on record their grateful appreciation of the valuable servicesrendered and contributions made by Shri. T Radhakrishnan Dr. D.V.R. Prakash Rao and Smt.T Manisriram during their tenure of office as Independent Directors of the Company
PARTICULARS OF EMPLOYEES
No employee of the Company was in receipt of Remuneration during the Financial Year2017-18 in excess of the sum prescribed under Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.
NUMBER OF MEETINGS OF THE BOARD
The Board Meetings were conducted to review the Company's business and to discuss itsstrategies and plans. During the Year 6 Board Meetings were convened and held thedetails of which are given in the Corporate Governance Report.
COMMITTEES OF THE BOARD
The Board has the following Committees:
1) Audit Committee;
2) Nomination and Remuneration Committee;
3) Stakeholders Relationship Committee and
4) Corporate Social Responsibility Committee
The details on the number of Audit Committee Meetings Stake Holders RelationshipCommittee meetings and Nomination and Remuneration Committee of the Company held duringthe year along with their constitution and other details are provided in the report onCorporate Governance. During the year all the recommendations of the Audit Committee wereaccepted by the Board.
As per provision of Section 134(3) (p) of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board has carried out aperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its various Committees for the financial year 2017-18.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declarations from all the independent directorsunder Section 149 (7) of the Companies Act 2013 that he/she meets the criteria ofindependence laid down in Section 149 (6) of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
The Company has a familiarization programme for Independent Directors pursuant toListing Regulations 2015. The same is dealt with in the Annual Report. TheFamiliarization Programme is available in the website of the Company. The link for thesame is given as http://www.binnyltd.in/images/policies/FAMILIARIZATION_DIRECTORS.pdf
EXTRACT OF ANNUAL RETURN:
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT- 9 form part of this Annual Report as ANNEXURE - I POLICY ON DIRECTOR'S APPOINTMENTAND REMUNERATION
The Nomination and Remuneration Policy provides for appropriate composition ofExecutive Non-Executive and Independent Directors on the Board of Directors of yourCompany along with criteria for appointment and remuneration including determination ofqualifications positive attributes independence of Directors and other matters asprovided under sub-section (3) of Section 178 of the Companies Act 2013. The remunerationpaid to the Directors is as per the terms laid out in the Nomination and RemunerationPolicy and as per the recommendations of Nomination and Remuneration Committee of theCompany.
Information required under Section 197 of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is set out in ANNEXURE-II
The Nomination and Remuneration policy is posted on the Company's website on the belowlink. http://www.binnyltd.in/ images/policies/Nomination_Policy.pdf
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the provisions contained in Section 134(3)(c) of the Companies Act 2013the Board to the best of its knowledge and belief and according to the information andexplanations obtained by it confirm that:
(a) in the preparation of the annual financial statements for the financial year ended31st March 2018 the applicable Accounting Standards and Schedule III of the CompaniesAct 2013 have been followed and there are no material departures from the same;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March 2018 and of the profitof the Company for the financial year ended 31st March 2018;
(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
(d) the directors had prepared the annual accounts on a going concern' basis;
(e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; (f) the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
VIGIL MECHANISM AND WHISTLE BLOWER POLICY:
The Company has formulated and adopted a vigil mechanism for employees to reportgenuine concerns to the Chairman of the Audit Committee. The policy provides opportunityfor employees to access in good faith the Audit Committee if they observe unethical andimproper practices. The Whistle Blower Policy of the Company is available in the websiteof the Company. The link for the same ishttp://www.binnyltd.in/images/policies/Whistle_Blower_Policy_Vigil_Mechanism.pdf
AUDITORS AND AUDITORS REPORT: A. Statutory Auditors:
M/s. Sagar & Associates Chartered Accountants Hyderabad bearing Firm RegistrationNo. 003510S were appointed as Statutory Auditors of the Company to hold office from theconclusion of 48th Annual General Meeting until the conclusion of 51stAnnual General Meeting at the Annual General Meeting held on 29th November2017.
The Auditors' Report does not contain any qualification.
B. Cost Auditors:
The Company is not required to appoint Cost Auditors under Section 148(2) of theCompanies Act 2013 read with the Companies (Cost records and Audit) Rules 2014.
C. Secretarial Auditor:
Pursuant to the provision of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 Shri. V.SureshPracticing Company Secretary has been appointed as Secretarial Auditor of the Company toundertake the Secretarial Audit of the Company for the Financial Year 2017-18. The reportof the Secretarial Auditor is enclosed as ANNEXURE III to this report. There are noqualifications reservations adverse remarks or disclaimers given by the SecretarialAuditor in the Report.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION & ANALYSIS REPORT:
The Company has complied with requirements of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. A report on the Corporate Governance practices theAuditors' Certificate on compliance of mandatory requirements thereof is given as anannexure to the Corporate Governance Report.
Management's Discussion and Analysis Report is presented in a separate section formingpart of the Annual Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Loans Guarantees and Investments covered under Section 186 of the Companies Act 2013form part of the Notes to the Financial Statements provided in this Annual Report.
The company has formulated and laid down procedures about the risk assessment and riskmanagement procedures. These procedures are periodically reviewed to ensure that risks aremanaged / mitigated through a well-defined framework.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY:
There are no material changes or commitments affecting the financial position of theCompany which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All transactions with related parties were reviewed and approved by the AuditCommittee. The details of the related party transactions as per Accounting Standard 18 areset out in Notes to the Financial Statements forming part of this report. The particularsof every contract or arrangements entered into by the Company with related partiesreferred to in sub-section (1) of section 188 of the Companies Act 2013 isdisclosed in Form No. AOC- 2 as ANNEXURE-IV
ADOPTION OF INDIAN ACCOUNTING STANDARDS (IND AS)
The Company has adopted Ind AS with effect from 01st April 2017 pursuant toCompanies (Indian Accounting Standards) Rules 2015 notified by Ministry of CorporateAffairs on 16th February 2015. The Company has completed the modification ofaccounting and reporting systems to facilitate the adoption of Ind AS. The implementationof Ind AS is a significant process adopted from the current financial year and the Companyhas presented the impact of Ind AS transition in the notes to the Financial Statements.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS:
The Company is maintaining adequate and effective Internal Financial Control (IFC) overFinancial Reporting (FR) based on Guidance notes on Audit for Internal financial Controlover financial reporting for ensuring the orderly and efficient conduct of its businessincluding adherence to its policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial information. Apart from InternalAuditors who review all the financial transactions and operating systems the Company hasalso in place adequate Internal Financial controls with reference to Financial Statements.During the year such controls were tested and no reportable material weaknesses in thedesign or operation were observed.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information pertaining to conservation of energy technology absorption Foreignexchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is as follows:
Conservation of Energy
1. The steps taken or impact on conservation of energy
2. The steps taken by the Company for utilizing alternate sources of energy During theyear NIL
3. The capital investment on energy conservation equipment
1. The efforts made towards technology absorption
2. The benefits derived like product improvement cost reduction product developmentor import substitution
3. In case of imported technology (imported during the last three years reckoned Duringthe year NIL from the beginning of the financial year) (a) the details of technologyimported (b) the year of import (c) whether the technology been fully absorbed (d) ifnot fully absorbed areas where absorption hasn't taken place and the reasons thereof
4. The expenditure incurred on Research and Development
Foreign Exchange Earnings and Outgo:
Foreign Exchange earned : 24.89 lakhs
Foreign Exchange used : Nil
CORPORATE SOCIAL RESPONSIBILITY (CSR):
The Company has constituted the Corporate Social Responsibility Committee during theyear. The composition of
Corporate Social Responsibility Committee is;
Shri. M Nandagopal - Chairman
Shri. Arvind Nandagopal - Member
Shri. R Arunkumar - Member
SCOPE OF CSR POLICY
This policy will apply to all projects/ programmes undertaken as part of the Company'sCorporate Social Responsibility and will be developed reviewed and updated periodicallywith reference to relevant changes in Corporate Governance statutory requirements andsustainable and innovative practices. The policy will maintain compliance and alignmentwith the activities listed in Schedule VII and Section 135 of the Companies Act 2013 andthe rules framed thereunder
CSR POLICY IMPLEMENTATION
The Company shall undertake CSR Project/ programmes identified by the CSR Committee andapproved by the Board of Directors in line with the CSR policy.
The CSR Policy of the Company is uploaded in the website of the Companyhttp://www.binnyltd.in/images/policies/ CSR Policy.pdf
REASON FOR NOT SPENDING ON CSR ACTIVITIES
The Company is in the process of identifying the suitable projects for CSR expenditure
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
There are no significant and material orders passed by the regulators or courts ortribunals that may have an impact for the Company as a going concern and/or company'soperations.
The Directors acknowledge the cooperation and assistance extended by the Government ofIndia and Government of Tamil Nadu and place on record their appreciation and gratitude tothem. The Directors also thank the shareholders employees and all other stakeholders ofthe Company for their continued support and cooperation.
| || ||ON BEHALF OF THE BOARD |
|Chennai ||Arvind Nandagopal ||R. Arunkumar |
|Date: August 13 2018 ||Managing Director ||Independent Director |
| ||DIN:00059009 ||DIN:00018588 |