To the Members of the Company
Your Directors have pleasure in presenting the 30th Annual Report on the business andoperations of your Company with Audited Accounts for the year ended 31st March 2019. Thefinancial results of the Company are summarized below:
FINANCIAL HIGHLIGHTS AND OPERATIONS:
| || ||(Amount in Lacs) |
|Particulars ||31st March 2019 ||31st March 2018 |
|Profit /Loss (before interest depreciation and tax) ||195.387 ||96.277 |
|Less: Interest ||34.128 ||18.903 |
|Less: Depreciation ||96.840 ||57.151 |
|Profit /Loss before Tax ||64.419 ||20.223 |
|Less: Loss on obsolence/damage to ||00 ||0.142 |
|Plant/assets || || |
|Less: Current Tax ||12.500 ||4.000 |
|Less: Deferred Tax ||1.755 ||(0.966) |
|Profit /Loss After Tax ||50.164 ||17.189 |
The financial performance of the Company was satisfactory and the Company continues tofocus on its initiatives to improve profitability through productivity improvement andcost optimization.
Considering future requirement of the funds your Directors think it prudent not torecommend any dividend for the financial year 2018-19.
The paid up Equity share capital of the Company as on 31st March 2019 was Rs.46000000/- (Rupees Four Crore Sixty Lakhs only)
CORPORATE GOVENRANCE REPORT:
The compliance with the Corporate Governance provisions as specified in regulations 17to 27 and Clause (b) to (i) of Sub- regulation (2) of regulation 46 and para C D and E ofSchedule V of SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015 isnot applicable to your Company as the paid up equity share capital not exceeding rupeesten crore and net worth not exceeding rupees twenty-five crore as on the last day of theprevious financial year. Accordingly the information required under said clauses are notfurnished hereafter. However the Board of Directors at Company level has enforcedcomplete adherence to the Corporate Governance norms. Provided that where the provisionsspecified in above said regulation becomes applicable to the Company at a later date theCompany shall comply with the requirements of those regulations within six months from thedate on which the provisions became applicable to the Company.
The Board of Directors was duly constituted and consisted of the following Directors:
|Name of the Director ||Designation |
|Mrs. Zaver Shankarlal Bhanushali ||Managing Director |
|Mr. Siddharth Shankarlal Bhanushali ||Whole-Time Director |
|Mr. Rajesh Purshottam Mange ||Independent Director |
|Mr. Vikram Popat Adagale ||Independent Director |
|Ms. Poonam Bhavin Bhanushali ||Independent Director |
Zaver Shankarlal Bhanushali retires by rotation and being eligible offers herself forre-appointment.
COMMITTEES OF THE BOARD:
The Board has constituted the following committees of Directors:
I) Audit Committee
II) Nomination and Remuneration Committee
III) Stakeholders' Relationship Committee
I. AUDIT COMMITTEE: a. Composition:
The Audit Committee comprises of three Directors namely:
|Name of the Director ||Category |
|Mr. Vikram P. Adagale ||Chairman |
|Mr. Rajesh P. Mange ||Member |
|Mrs. Poonam Bhavin Bhanushali ||Member |
b. Terms of reference:
Apart from all the matters provided in SEBI Listing Regulations and section 177 of theCompanies Act 2013 the Audit committee shall also perform the following functions:
(a) Review of the Company's financial reporting process and financial statements.
(b) Review of accounting and financial policies and practices.
(c) Review of Internal control systems and Management discussion and analysis offinancial condition
(d) Discussion with Statutory/Internal Auditors on any significant findings andfollow-up thereon.
(e) Reviewing the Company's financial and risk management policies.
c. Audit committee Meetings and Attendance:
The Committee has met 4 times during the financial year ended 31st March 2019 i.e. on30th May 2018 14th August 2018 10th November 2018 and 13th February 2019. Details ofattendance of each Director at the Audit Committee Meetings are given below:
|Name of the Director ||Position ||Meeting attendance |
|Mr. Vikram P. Adagale ||Chairman ||4 |
|Ms Poonam Bhavin Bhanushali ||Member ||4 |
|Mr. Rajesh P. Mange ||Member ||4 |
II. NOMINATION AND REMUNERATION COMMITTEE:
a. Composition and attendance:
As on the date of this report Nomination and Remuneration Committee comprised of threeNon-Executive Directors namely Mr. Rajesh P. Mange (Chairman of the Committee) Mrs.Poonam Bhavin Bhanushali and Mr. Vikram P. Adagale as members of the Committee.
During the financial year the committee did not have any meeting as there were noissues concerning the remuneration of whole-time/executive Directors.
b. Terms of Reference:
The broad terms of reference of the committee are to appraise the performance ofManaging Director and whole time directors determine and recommend to the Board thecompensation payable to Managing Director and whole time directors. The remunerationpolicy of the Company is based on review of achievements. The remuneration policy is inconsonance with the existing industry practice.
c. Remuneration Policy:
Subject to the approval of the Board of Directors and subsequent approval by themembers at the General Meeting and such authorities as the case may be remuneration ofManaging Director and Whole-time Directors is fixed by the Nomination & RemunerationCommittee. The remuneration is decided by the Nomination & Remuneration Committeetaking into consideration various factors such as qualifications experience expertiseprevailing remuneration in the competitive industries financial position of the Companyetc.
d. Remuneration to Directors:
The details of remuneration for the year ended March 31 2019 paid to the Executive /Non-Executive Directors are as follows:
| ||Designation ||Remuneration |
|Mrs. Zaver S. Bhanushali ||Chairman & Managing Director ||INR 840000.00 |
|Mr. Siddharth S. Bhanushali ||Whole-time Director ||INR 720000.00 |
The Company has paid sitting fees of Rs. 2000/- per meeting to Non-Executive Directorsduring the financial year 2018-19.
III. STAKEHOLDERS RELATIONSHIP COMMITTEE:
a) Composition and attendance:
The present Stakeholders Relationship Committee comprised of Executive andNon-Executive Directors namely Mr. Rajesh Purshottam Mange (Chairman of the Committee)Mr. Vikram P. Adagale Mrs Zaver Shankarlal Bhanushali and Mr. Siddharth S. Bhanushali asa members of the Committee.
The Committee has been empowered to look into all shareholder's grievances periodicallyand take necessary actions. Further there were no complaints pending to be redressedduring the year under review.
b) Terms of Reference:
The Stakeholders Relationship Committee to look into redress of Investors Complaintsand requests such as delay in transfer of shares non-receipt of Dividend Annual Reportrevalidation of Dividend warrants etc.
The committee deals with various matters relating to:
Transfer / transmission of shares
Issue of Share certificate in lieu of lost sub-divided consolidated rematerializedor defaced certificates.
Consolidation / splitting of folios
Review of shares dematerialized and all other related matters
Investors grievance and redressal mechanism and recommend measures to improvethe level of investors services.
c) Meeting of Independent Directors
During the year under review meeting of Independent Directors was held on 13th August2018 to review the performance of the Board as a whole and Chairman on parameters ofeffectiveness and to assess the quality quantity and timeliness of flow of informationbetween the management and the Board.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
On their appointment Independent Directors are familiarized about the Company'sbusiness and operations. Interactions with senior executives are facilitated to gatherinsight specific to the Company's operations. Detailed presentations are made available toapprise about Company's history of their duties and responsibilities rights process ofappointment and evaluation compensation Board and Committee procedures and expectationof various stakeholders. The details of familiarization programmes as above are alsodisclosed on the website of the Company at the link: http://caparolactam.co.in
DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 (Act) stating that the IndependentDirectors of the Company met with the criteria of Independence laid down in Section 149(6) of the Act and Regulation 25(8) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 134 (3) (c) of the Companies Act 2013 withrespect to Directors' Responsibilities Statement it is hereby confirmed:
that in the preparation of the annual accounts for the financial year ended 31stMarch 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures;
that the Directors have selected such accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit or loss of the Company for that period;
that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; and
that the Directors have prepared the accounts for the financial year ended 31stMarch 2019 on a going concern' basis.
that the directors had laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and were operatingeffectively.
that the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and such systems are adequate and operating effectively.
INFORMATION REGARDING EMPLOYEES AND RELATED DISCLOSURES:
The Company has not appointed any employee(s) who is in receipt of remunerationexceeding the limits specified under Rule 5(2) of Companies (Appointment &Remuneration of Managerial Personnel) Rules 2014.
The statement of Disclosure of Remuneration under Section 197 of the Act and Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014("Rules") is required to be the part of this Board's Report and to be sent tothe Members of the Company along with the Board Report. However same is not mentioned inthis report and would be available for inspection by the Members at the Meeting andreport referred above is also open for inspection by the Members at the Registered Officeof the Company on any day between 10.00 a.m. to 12.00 p.m. except Saturday Sunday andPublic Holiday up to the date of Annual General Meeting.
The Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The Company has not extended any loans guarantees nor made any investments coveredunder the provisions of Section 186 of the Companies Act 2013.
NUMBER OF MEETINGS OF THE BOARD:
The Board met 5 (Five) times during the financial year and the intervening gap betweenany two meetings was within the period prescribed by the Companies Act 2013. The dates onwhich the meetings were held are 21st April 2018 30th May 2018 14th August 2018 10thNovember 2018 and 13th February 2019.
The names of members of the Board and their attendance at the Board Meetings are asunder:
|Name of Directors ||Number of Meetings attended/Total Meetings held during the F.Y. 2018-19 |
|Zaver S. Bhanushali ||5/5 |
|Siddharth S. Bhanushali ||5/5 |
|Vikram P. Adagale ||5/5 |
|Poonam Bhanushali ||5/5 |
|Rajesh P. Mange ||5/5 |
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.caprolactam.in.
RISK MANAGEMENT POLICY:
Your Company is aware of the risks associated with the business. It regularly analysesand takes corrective actions for managing/ mitigating the same. Your Company hasinstitutionalized the policy/process for identifying minimizing and mitigating risk whichis reviewed. The key risks and mitigation actions are placed before the Audit Committee.
Pursuant to the provisions of the Companies Act 2013 and the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 a structured questionnaire was preparedafter taking into consideration the various aspects of the Board's functioningcomposition of the Board and its Committees culture execution and performance of thespecific duties obligations and governance.
The performance evaluation of the Independent Directors was completed. The performanceevaluation of the Chairman and the Non Independent Directors was carried out by theIndependent Directors. The Board of Directors expressed their satisfaction with theevaluation process.
The Board has on the recommendation of the Nomination & Remuneration committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration.
SIGNIFICANT AND MATERIAL ORDERS:
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company does not have any obligation to fulfill under corporate socialresponsibility as none of the criteria are applicable to the Company.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THEFINANCIAL YEAR AND DATE OF REPORT:
There have been no material changes and commitments affecting the financial position ofthe Company between the end of the financial year and the date of the report.
CHANGE IN THE NATURE OF BUSINESS
During the year under review there is no change in the nature of Business of theCompany.
DETAILS OF CHANGE IN DIRECTOR/KEY MANAGERIAL PERSONS:
Ms. Poonam Bhavin Bhanushali was appointed as the Additional Director of the Companywith effect from 21st April 2019. Further she was regularized as an Independent Directorin the Company with effect from 29th September 2018
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has also Appointed Abhishek Ruia & Co. as an Internal Auditor of theCompany.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the Company with the relatedparties and/or Promoters Key Managerial Personnel or other designated persons which mayhave potential conflict with interest of the Company at large. None of the Directors haveany pecuniary relationship or transactions vis--vis the Company other than sitting feesand reimbursement of expenses incurred if any for attending the Board meeting.
The Related Party Transactions are placed before the Audit Committee for review andapproval as per the terms of the Policy for dealing with Related Parties. Prior omnibusapproval of the Audit Committee is obtained on a quarterly basis for transactions whichare foreseen and of repetitive nature. The statement containing the nature and value ofthe transactions entered into during the quarter is presented at every subsequent AuditCommittee meeting by the CFO for the review and approval by the Committee. Furthertransactions proposed in subsequent quarter are also presented. Besides the Related PartyTransactions are also reviewed by the Board on an annual basis. The details of the RelatedParty Transactions are provided in the accompanying financial statements. There are nocontracts or arrangements entered into with Related Parties during the year ended 31stMarch 2019 to be reported under section 188(1) of the Companies Act 2013.The policy ondealing with Related Parties as approved by the Board is uploaded and is available on theCompany's website at the following link http://caparolactam.co.in
SUBSIDIARY AND ASSOCIATES COMPANIES:
The Company does not have any Subsidiary or Associate Company.
AUDITOR'S REPORT/ SECRETARIAL AUDIT REPORT:
The observation/comment made in the Auditors' Report read together with relevant notesthereon are self- explanatory and hence do not call for any further comments underSection 134 of the Companies Act 2013. As required under section 204 (1) of the CompaniesAct 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 the Company has appointed Ms. Alpi Nehra Practicing Company Secretary to undertakethe Secretarial Audit of the Company and has obtained a secretarial audit report. Furtherafter the close of the financial year 2018-19 Mr Surya Prakash Moud was appointed as aCompany Secretary by the Company with effect from 30th April 2019
The Secretarial Audit report is annexed herewith as "Annexure B"
The Company is in compliance with the Secretarial Standard on Meetings of the Board ofDirectors(SS-1) and Secretarial Standard on General Meetings (SS-2).
M/s L. J. Kothari & Co. Chartered Accountants Mumbai [ Firm Reg. No. 105313W]tendered their resignation to discontinue as the Statutory Auditor of the Company for theremaining term of their period. Hence in order to fill up the casual vacancy the Companyhas appointed M/s. Bipin Kothari & Associates Chartered Accountants (FirmRegistration no. 137687W) in the Board Meeting convened on 26th August 2019. The officeof M/s. Bipin Kothari & Associates Chartered Accountants (Firm Registration no.137687W) Mumbai are to be confirmed by the members in the ensuing Annual General MeetingFurther their appointment shall be for the tenure of 05 (Five) years subject to theapproval of members in the ensuing Annual General Meeting. As required under Section 139of the Companies Act 2013 the Company has received a written consent from M/s. BipinKothari & Associates Chartered Accountants (Firm Registration no. 137687W) Mumbaifor such appointment and also a certificate to the effect that their appointment if madewould be in accordance with Section 139(1) of the Companies Act 2013 and the rules madethereunder.
LISTING OF SECURITIES IN STOCK EXCHANGES:
The Company's Equity Shares are presently listed on Bombay Stock Exchange Limited.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure A" and forms part of this Report and is also available atthe website of Company: http://cparolactam.co.in
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND:
Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).
PREVENTION OF INSIDER TRADING:
In January 2015 SEBI notified the SEBI (Prohibition of insider trading) Regulations2015 which came into effect from May 15 2015. Pursuant thereto the Company hasformulated and adopted a new Code for Prevention of Insider Trading.
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading window is closed. The Board is responsible forimplementation of the Code. All Directors and the designated employees have confirmedcompliance with the Code.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The related information is provided in "Annexure C" which is attached tothis report.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
Reporting under the sexual harassment of women at workplace (Prevention Prohibitionand Redressal) Act 2013 is not required as the Company has not employed any women atwork place.
An acknowledgement to all with whose help cooperation and hard work the Company isable to achieve the results.
For and behalf of the Board of Directors
|SD/- ||SD/- |
|Zaver Shankarlal Bhanushali ||Siddharth Shankarlal Bhanushali |
|Managing Director ||Whole time Director |
|DIN: 00663374 ||DIN: 01721586 |