Dear Shareholders (Members)
On behalf of the Board of Directors it is our pleasure to present the 72nd AnnualReport together with the Audited Statement of Accounts of Bright Brothers Limited("the Company") for the year ended 31st March 2019.
(Rs in Lakhs)
|Particulars ||Year Ended 31st March 2019 ||Year Ended 31st March 2018 |
|Net Sales and Operating Income ||23078.64 ||21441.70 |
|Less: Expenses ||21711.35 ||20304.46 |
|Operating Profit ||1367.29 ||1137.24 |
|Add: Other Income ||41.24 ||103.15 |
|Profit before Depreciation Finance Cost and Tax ||1408.53 ||1240.39 |
|Finance Costs ||621.67 ||581.19 |
|Depreciation and amortization expenses ||576.75 ||545.93 |
|Profit before tax ||210.11 ||113.27 |
|Less: Tax expense ||9.80 ||(7.08) |
|Profit after tax ||200.31 ||120.35 |
|Other comprehensive income ||(7.59) ||10.99 |
|Total comprehensive income ||192.72 ||131.34 |
Summary of Operations
The total operational income of your company for the year ended 31st March 2019 stoodat Rs 23078.64 lakhs as against Rs 21441.70 lakhs in the previous year resulting in anincrease of Rs 1636.94 lakhs as compared to the previous year.
The Operating Profit before Depreciation Finance Cost and Tax for the year ended 31stMarch 2019 amounted to Rs 1367.29 lakhs as against Rs 1137.24 lakhs in the previousyear.
The Year in Retrospect
During the financial year 2018-19 India's GDP growth is estimated to be 6.8%. TheIndian economy did face a growth risk due to fluctuation in rupee and crude pricedemonetisation and disruption in supply chains following the implementation of the Goodsand Services Tax (GST). Industrial activity across sectors showed only a marginalimprovement as labour-intensive sectors such as textiles gems and jewellery leatheretc. continued to struggle throughout the year.
Consumer sentiments remained suppressed for most part of the year with urban consumersfeeling the overhang of inadequate job/income growth and high oil prices. At the sametime persistent deflation in food prices and lack of Minimum Support Price (MSP)realisations adversely impacted rural demand. In addition credit growth was severelyaffected in the second half of the financial year with the nonbanking financial sectorunder stress from defaults by a few large players in the sector.
However this continued volatility will not impact India's sovereign credit profile asper Moody's analysis; as the rupee-denominated government bonds and robust foreignexchange reserves will help mitigate the risk. Hence the world is confident of India'sgrowth potential. The confidence in the Indian economy has increased substantially becauseof the various policy measures taken by the Government. India's future growth trend willbe driven by structurally positive factors - favourable demographics structural reformsincreased digitization focus on development of infrastructure and housing andacceleration of productive job opportunities.
Outlook for the current year
India has emerged as one of the fastest growing major economies in the world and isexpected to be one of the top three economic powers of the world over the next 10-15years backed by its strong democracy and partnerships. Numerous foreign companies aresetting up their facilities in India on account of various government initiatives likeMake in India and Digital India.
Growth in India is expected to stabilise at 7 per cent over the medium term based oncontinued implementation of structural and financial sector reforms easing ofinfrastructure bottlenecks with efforts to reduce public debt which is essential to securethe economy's growth prospects.
Material changes and commitments if any affecting the financial position of theCompany which have occurred between the end of the financial year till the date of report
There are no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year 2018-19 and the date ofthis report. There has been no change in the nature of business of the Company.
Dividend and Reserves
Your Directors are pleased to recommend a dividend of Rs 2 per Equity Share on5680235 Equity Shares of Rs 10 each for the financial year ended 31st March 2019. Thesaid dividend if approved by the members would involve a cash outflow Rs 136.96 lakhscomprising of Rs 113.60 lakhs as dividend and Rs 23.36 lakhs as tax on dividend.
The dividend will be paid subject to the approval of shareholders at the forthcomingAnnual General Meeting to those shareholders whose names appear on the Register of Membersof the Company as on the specified date.
The paid up Equity Share Capital as on 31st March 2019 was Rs 567.60 lakhs. During theyear the Company has not issued any shares.
Loans guarantees or investments
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes accompanying the financialstatements.
Your Company has not accepted any deposits from public and its members during thefinancial year 2018-19. There has been no deposit which was unpaid or unclaimed as at theend of the year. There has not been any default in repayment of deposits or payment ofinterest thereon during the year. The Company is holding deposits of Rs 263 lakhs from itsDirectors and Rs 45 lakhs from its members as on 31st March 2019.
Related party transactions
All transactions entered with related parties for the year under review were on arm'slength basis and in the ordinary course of business and the provisions of Section 188 ofthe Companies Act 2013 are not attracted. Thus disclosure in AOC-2 is not required. Thedetails of transaction are provided in Note No. 39 of the Notes to Accounts. Furtherthere are no material related party transactions during the year under review with thePromoters Directors and Key Managerial Personnel.
All Related Party Transactions are placed before the Audit Committee as also before theBoard for approval. Omnibus approval was obtained for transactions which are repetitive innature. A statement giving details of all the transactions entered into pursuant toomnibus approval are placed before the Audit Committee and Board for a review.
The policy on Related Party Transactions as approved by the Board of Directors has beenuploaded on the website of the Company. None of the Directors have any pecuniaryrelationships or transactions vis-a-vis the Company.
All the assets of the Company are fully insured against major risks.
The company has obtained unsecured loan from Smt. Hira Bhojwani Whole Time Director tomeet the short term requirements of the company. The total outstanding loan as on 31stMarch 2019 is Rs 460 lakhs.
Internal financial controls
The internal financial controls with reference to the Financial Statements arecommensurate with the size and nature of business of the Company. The Company hasappointed Internal Auditors who periodically audit the adequacy and effectiveness of theinternal controls laid down by the management and suggest improvements. The AuditCommittee periodically approves the audit reports implementation of auditrecommendations if any and adequacy of internal controls. Based on the framework ofinternal financial controls and compliance systems established and maintained by theCompany the work performed by the internal statutory and secretarial auditors the Boardis of the opinion that the Company's internal financial controls were adequate andeffective during financial year 2018-19.
Significant and material orders passed by the Regulators
During the year under review no significant and material orders were passed by theRegulators or Courts or Tribunals impacting the going concern status and Company'soperations.
Directors' Responsibility Statement
Pursuant to the requirement of clause (c) of sub-section (3) of Section 134 of theCompanies Act 2013 your Directors 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) the Directors have 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 at the end of the financial year and ofthe profit and loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively;
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Management Discussion and Analysis
Management Discussion and Analysis of the financial conditions and result of operationsof the Company for the period under review as required under Regulation 34(2)(e) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is given in a separatestatement in the Annual Report as Annexure I.
A separate report on Corporate Governance is set out in Annexure II.
Meetings of the Board and its Committees
The details of the Board meetings and various Committee meetings have been mentioned inthe Report of Corporate Governance annexed as Annexure II.
Extract of Annual Return
Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014 an extract of the annual return in the formof MGT-9 is annexed as Annexure III.
Report of the Statutory Auditors and Notes to Financial Statements
At the 70th Annual General Meeting held on 10th August 2017 the members had appointedM/s. Desai Saksena & Associates Chartered Accountants as Statutory Auditors of theCompany from the conclusion of the 70th Annual General Meeting till the conclusion of the75th Annual General Meeting. As per the Companies (Amendment) Act 2017 enforced on 7thMay 2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors isnot required to be ratified at every Annual General Meeting.
Further the Report of the Statutory Auditors alongwith notes to Schedules is enclosedto this report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report. The observations made in the Auditor's Report areself-explanatory and therefore do not call for any further comments.
As per the requirement of the Central Government and pursuant to Section 148 of theCompanies Act 2013 read with the Companies (Cost Records and Audit) Rules 2014 asamended from time to time your Company needs to conduct a Cost Audit for the financialyear ending on 31st March 2020.
The Board of Directors on recommendation of the Audit Committee has appointed M/s. S.R. Singh & Co. Cost Accountants as Cost Auditor to audit the cost accounts of theCompany for the financial year 2019-20 at a remuneration of Rs 150000/- plus tax asapplicable and reimbursement of out of pocket expenses. As required under Companies Act2013 a resolution seeking members' approval for the remuneration payable to the CostAuditor forms part of the Notice convening Annual General Meeting.
In terms of Section 204 of the Act and Rules made there under Ms. Purnima ShettyPracticing Company Secretary has been appointed Secretarial Auditor of the Company. Thereport of the Secretarial Auditor for the financial year 2018-19 is enclosed as AnnexureIV to this report.
The Report is self-explanatory and does not call for any further comments.
Whistle Blower Policy
Pursuant to the requirement of the Act the Company has approved its Whistle BlowerPolicy which is also called as vigil mechanism. It is uploaded on website of the company.
This mechanism enables directors and employees to report concerns about unethicalbehavior actual or suspected fraud or violation of the Company's code of conduct orethics policy.
Risk Management Policy
The Company has developed and implemented the Risk Management Policy.
The Company considers ongoing risk management to be a core component of the managementof the Company and understands that the Company's ability to identify and address risk iscentral to achieving its corporate objectives.
The policy is in compliance with SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 hereinafter referred to as "Listing Regulations" andprovisions of the Companies Act 2013 which requires the Company to lay down proceduresabout risk assessment and risk minimization.
Directors and Key Managerial Personnel
i. Re-appointment of Smt. Hira Bhojwani Director who is liable to retire by rotation
Smt. Hira Bhojwani (DIN 00032997) Director of the Company will retire by rotation atthe forthcoming Annual General Meeting and being eligible offers herself forre-appointment.
ii. Re-appointment of Independent Directors of the company
Mr. K. P. Rao (DIN 00027577) Dr. T. S. Sethurathnam (DIN 00042704) and Mr. ByramJeejeebhoy (DIN 00033204) were appointed as Independent Directors on the Board of theCompany at the Annual General Meeting held on 4th September 2014 for a period of 5 (five)years. They hold office as Independent Directors of the Company up to the conclusion ofthe ensuing Annual General Meeting of the Company. The Board of Directors on the basis ofthe report of performance evaluation of Independent Directors has recommendedre-appointment of Mr. K. P. Rao Dr. T. S. Sethurathnam and Mr. Byram Jeejeebhoy asIndependent Directors for a second term of 5 (five) consecutive years on the Board of theCompany subject to approval of the members of the Company in the ensuing Annual GeneralMeeting.
iii. Appointment of Mrs. Devika Bhojwani as Whole-time Director
Mrs. Devika Bhojwani (DIN 08355381) was appointed as Additional Director by the Boardof Directors at its meeting held on 13th February 2019 on the basis of recommendation ofNomination and Remuneration Committee. She is appointed as an Additional Director w.e.f.1st April 2019 till the conclusion of this Annual General Meeting. As per therecommendation from the Nomination and Remuneration Committee the Board of Directorspropose to appoint her as Whole-time Director for a period of three years i.e. from 1stOctober 2019 to 30th September 2022 subject to approval of the members of the Company inthe ensuing Annual General Meeting.
iv. Appointment of Smt. Hira Bhojwani as Non-executive Director
Smt. Hira Bhojwani (DIN 00032997) was appointed as Whole-time Director by the membersof the Company at the Annual General Meeting held on 3rd August 2016 for a period ofthree years expiring on 31st March 2019. The Board of Directors at its meeting held on13th February 2019 on the basis of recommendation of Nomination and RemunerationCommittee have considered her appointment as a Non-executive Director w.e.f. 1st April2019 for a period of three years subject to approval of the members at the ensuing AnnualGeneral Meeting.
Declaration by Independent Directors
Mr. K. P. Rao Dr. T. S. Sethurathnam and Mr. Byram Jeejeebhoy are IndependentDirectors on the Board of your Company. In the opinion of the Board and as confirmed bythese Directors they fulfill the conditions specified in Section 149 of the Act and theRules made thereunder and Regulations 16(1)(b) of Listing Regulations about their statusas Independent Directors of the Company.
There has been no change in the circumstances affecting their status as IndependentDirectors of the Company. During the year under review the Independent Directors of theCompany had no pecuniary relationship or transactions with the Company other than sittingfees commission and reimbursement of expenses incurred by them for the purpose ofattending meetings of the Board/Committee of the Company.
Company's Policy on Appointment and Remuneration
The objective of Remuneration Policy is to attract motivate and retain qualified andexpert individuals that the Company needs in order to achieve its strategic andoperational objectives whilst acknowledging the societal context around remuneration andrecognizing interest of stakeholders.
Formal Annual Evaluation by the Board of its own performance and that of its Committeesand individual Directors
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a structured questionnaire was prepared aftertaking into consideration the various aspects of the Board's functioning composition ofthe Board and its Committees. The evaluation process inter alia considers attendance ofDirectors at Board and Committee meetings participation at meetings domain knowledgecohesion the Board's meetings awareness and observance of governance etc.
The Board carried out performance evaluation of the Board Board committees individualDirectors and Chairperson.
The Company has put in place an induction and familiarization programme for all itsdirectors including the Independent Directors. The familiarization programme forIndependent Directors in terms of provisions of Regulation 46(2) of Listing Regulations isuploaded on the website of the company.
Transfer of Unclaimed dividend and underlying shares to Investor Education andProtection Fund (IEPF)
In accordance with the applicable provisions of Companies Act 2013 read with InvestorEducation and Protection Fund (Accounting Audit Transfer and Refund ) Rules 2016("IEPF Rules") all unclaimed dividends are required to be transferred by theCompany to the IEPF after completion of seven (7) years. Further according to IEPFRules the shares on which dividend has not been claimed by the shareholders for seven (7)consecutive years or more shall be transferred to the demat account of the IEPF Authority.
Pursuant to the provisions of IEPF Rules the Company has filed the necessary forms anduploaded the aforesaid details on IEPF website (www.iepf.gov.in).
Compliance with Secretarial Standards issued by the Institute of Company Secretaries ofIndia
The Company has complied with the Secretarial Standards issued by the Institute ofCompany Secretaries of India on Meetings of the Board of Directors and General Meetings.
Particulars of Employees
Disclosure pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annexure formingpart of the Annual Report.
Having regard to the provisions of Section 136(1) read with its relevant proviso of theCompanies Act 2013 the Annual Report excluding the aforesaid information is being sentto the members of the Company. The said information is available for inspection at theRegistered Office of the Company during working hours and any member interested inobtaining such information may write to the Company Secretary.
None of the employees of the Company is falling under the criteria as set out in Rule5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014regarding remuneration.
Your Company treats its "human resources" as one of its most importantassets.
Your Company is focused on the promotion of talent internally through job rotation andjob enlargement.
Prevention Prohibition and Redressal of Sexual Harassment at Workplace
The Company has formulated a policy on Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. It has also formulated InternalComplaints Committee under the Act. During the year under review no complaints were filedunder the said Act.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
Information given as required under Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014.
A. Conservation of Energy:
Continuous monitoring and awareness amongst employees has helped to avoid wastage ofenergy. Various investments in reducing the consumption of energy has helped the Companyto reduce the overall power consumption.
Continuous study and analysis for energy conservation installation of energy efficientequipments has resulted into lower units of power consumption per kg production offinished products. Energy Conservation measures taken:
Installation of Variable Frequency Drives (VFD) to reduce the power consumptionof old machines.
Energy efficient pump for cooling tower.
Installation of servo drives in injection moulding machines to reduce powerconsumption.
Replacement of higher HP motor with lower HP motor.
Replacement of CFL with LED lights.
B. Technology Absorption Adaptation and Innovation:
C. Foreign Exchange Earnings and Outgo:
Foreign Exchange Earnings: Rs Nil Foreign Exchange Outgo: Rs 85.72 lakhs
Your Directors place on record their appreciation for employees at all levels who havecontributed to the growth and performance of your Company.
Your Directors also thank the clients vendors bankers shareholders and advisers ofthe Company for their continued support.
Your Directors also thank the Central and State Government and other statutoryauthorities for their continued support.
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For and on behalf of the Board
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bright brothers limited
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Chairman & Managing Director
|Place : Mumbai || |
|Date : 21st May 2019 || |