The Directors have pleasure in presenting the 30th Annual Report of the Company alongwith the Audited Financial Statements of the Company for the financial year ended 31stMarch 2019.
The Company's performance during the year as compared with previous year is summarizedbelow:
(Rs. In Crores)
|Particulars ||FY 2018-19 ||FY 2017-18 |
|Revenue From operations ||231.39 ||203.54 |
|EBITDA ||16.36 ||12.80 |
|Interest Cost ||7.27 ||6.79 |
|Profit / (Loss) before depreciation and tax ||9.09 ||6.01 |
|Depreciation ||5.85 ||6.89 |
|Profit/ (Loss) before tax ||3.24 ||(0.88) |
|Provision for Taxation ||0.00 ||0.00 |
|Profit / (Loss) after tax ||3.24 ||(0.88) |
|Other Comprehensive Income ||(0.93) ||(0.42) |
|Total Comprehensive Income ||2.31 ||(130) |
|Earnings per Share ( In Rs.) ||0.69 ||(0.21) |
The Company has turned in a satisfactory performance in the year 2018-19 with a netRevenue from operations at Rs.231.39 crs reflecting ~ 13.7 percent rise vis-a-visRs.203.54 crs recorded in the previous year. The Operating EBITDA stood at Rs.16.36 crsagainst Rs.12.80 crs the previous year.
A detailed analysis of the financial results is given in the Management Discussion andAnalysis Report which forms part of this report.
CHANGES TO SHARE CAPITAL
Allotment of Equity Shares on Preferential basis upon conversion of Warrants:"During the financial year 2016-17 the Company has issued and allotted 5696756Warrants at a price of Rs.11.41 (including premium of Rs.1.41) per Warrant to promotersand Managing Director convertible into equivalent number of Equity Shares on preferentialbasis in accordance with and in terms of the provisions of Sections 39 42 and 62(1)(c) ofthe Companies Act 2013 read with rules framed thereunder Chapter VII of the SEBI (Issueof Capital and Disclosure Requirements) Regulations 2009 as amended from time to timeand other applicable laws.
Out of the 5696756 warrants allotted 3505696 Warrants were converted intoequivalent number of Equity Shares during the previous year and the remaining 2191060Warrants were converted into equivalent number of Equity Shares during the year underreview.
Consequent upon allotment of 2191060 equity shares on preferential basis the paid upshare capital of the Company has been increased from Rs. 706814450 to Rs. 728725050
The entire issue proceeds were utilized for Augmenting Long Term Capital and forgeneral corporate purpose. This equity infusion reiterates the promoter's commitmenttowards the business of the company and confidence in its growth prospects and willstrengthen the balance sheet of the company.
Due to the losses incurred by the Company in the earlier years the Board of Directorshave not recommended any dividend for the financial year ended 31st March 2019.
TRANSFER TO RESERVES
During the year under review the Company has not transferred any amount to thereserves.
FINANCE AND ACCOUNTS
The financial statements are prepared in accordance with Indian Accounting Standards(Ind AS) notified under the Companies (Indian Accounting Standards) Rules 2015 read withSection 133 of Companies Act 2013 (the Act') and other relevant provisions of theAct. The financial statements up to and for the year ended March 31 2017 were preparedin accordance with the Companies (Accounting Standards) Rules 2006 notified underSection 133 of the Act (Previous GAAP'). The financial statements for the year endedMarch 31 2018 is the first financial statements of the Company under Ind AS.
Due to the losses incurred by the Company in the earlier years there is no provisionfor Income Tax. The Company has recognized Deferred Tax Asset in unabsorbed depreciationand accumulated losses to the extent of corresponding deferred tax liability on thedifference between the book balances and written down value of fixed assets under IncomeTax.
During the year under review the Company has not accepted or renewed any fixeddeposits from the public falling under Section 73 of the Act read with the Companies(Acceptance of Deposits) Rules 2014. Thus as on March 31 2019 there were no depositswhich were unpaid or unclaimed and due for repayment.
CASH FLOW STATEMENT
In conformity with the provisions of Section 134 of Companies Act 2013 and Regulation34 2(c) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 theCash flow statement for the year ended 31st March 2019 forms part of this Annual Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the transactions with the related parties entered during the year were in theordinary course of business and on Arm's length basis. Details of such transactions aregiven in the accompanying financial statements.
The Company has framed a policy on Related Party Transactions and the same has beendisplayed in the Company's website www.celebritygroup.com
Further the prescribed details of related party transactions of the Company in FormNo. AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts)Rules 2014 is given in Annexure II to this Report.
SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES
The Company does not have any subsidiary or associate or joint venture company.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION & ANALYSIS
The Corporate Governance Report and Management Discussion & Analysis which formspart of this report are set out separately along with the Certificate from the Auditors ofthe Company regarding compliance of conditions of Corporate Governance and Certificatefrom a Company Secretary in practice that none of the directors on the Board of theCompany have been debarred or disqualified from being appointed or continuing as directorsof companies by the Board/Ministry of Corporate Affairs or any such statutory authority asstipulated in Schedule V read with Regulation 34(3) of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
COMPLIANCE WITH CODE OF CONDUCT
The Company has framed a Code of Conduct for all the members of the Board and SeniorManagement personnel of the Company which was amended with effect from 1st April 2019.The Code of Conduct is available on the Company's website: www.celebritygroup.com.
All members of the Board and senior management personnel have affirmed compliance tothe Code as on March 31 2019.
As stipulated under Regulation 34 (3) and Schedule V (D) of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 a declaration Signed by Mr. VidyuthRajagopal Managing Director to this effect is annexed to the report on Corporategovernance which forms part of this annual report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In compliance with the requirements of Section 135 and Schedule VII of the CompaniesAct 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014 asamended the Board of Directors have constituted a CSR Committee. The details of theCommittee are provided in the Corporate Governance Report which forms part of this AnnualReport.
As there have been carry forward losses provisions of Section 135 of Companies Act2013 pertaining to Corporate Social Responsibility are not applicable to the Company.
The contents of the CSR Policy of the Company as approved by the Board on therecommendation of the CSR Committee is available on the website of the Company.
ESTABLISHMENT OF VIGIL MECHANISM
Pursuant to Section 177 (9) of Companies Act 2013 and Regulation 22 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has a vigilmechanism established to enable all employees and the directors to report in good faithabout any violation of the Policy. The Audit Committee of the Board oversees thefunctioning of Whistle Blower Policy. The Whistle Blower Policy covering all employees anddirectors is hosted in the Company's Website www.celebritygroup.com .
DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors:
Change in Designation
During the year the board at its meeting held on 08th August 2018 based on therecommendation of the Nomination & Remuneration Committee appointed Mr. VidyuthRajagopal who was actively involved in all spheres of the management of the Company asManaging Director from the position of Joint Managing Director with effect from 08thAugust 2018 to hold office for a term of 3 (three) years and the same was approved by theshareholders at the 29th Annual General Meeting of the Company held on 25th September2018.
Mr. Pattabi Sundar Raman (DIN: 00003606) Mr. Nugahalli Krishna Ranganath (DIN:00004044) Mrs. Nidhi Reddy (DIN: 00004081) were re-appointed as Independent Directors ofthe Company at the 29th Annual General Meeting of the Company held on 25th September 2018to hold office for a term of 05 (five) consecutive years from 01st April 2019 till 31stMarch 2024. They were re-appointed based on their performance evaluation and as per therecommendation of the Nomination and Remuneration Committee and the Board considered thattheir continued association would be of immense benefit to the Company.
Mr. Charath Ram Narsimhan resigned as Managing Director and from the Board of theCompany effective 07th August 2018.
Key Managerial Personnel:
The following are the Key Managerial Personnel of the Company:
|1. Mr. Vidyuth Rajagopal ||- Managing Director |
|2. Mr. S. Venkataraghavan ||- Chief Financial Officer |
|3. Mr. A. Rishi Kumar ||- Company Secretary |
During the year there has been no change in the Key Managerial Personnel.
EMPLOYEE STOCK OPTION PLAN (ESOP)
During the financial year ended 31st March 2019 there were no pending options to bevested or exercised.
DECLARATION BY INDEPENDENT DIRECTOR
The Company has received necessary declarations from all the Independent Directors ofthe Company confirming that they continue to meet the criteria of Independence asprescribed under Section 149(6) of the Companies Act 2013 and Regulation 16 & 25 ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act 2013 read with Rule 12(1) of theCompanies (Management and Administration) Rules 2014 as amended an extract of theAnnual Return of the Company in the prescribed form MGT-9 is annexed as Annexure - III tothis Annual Report. The Annual Return has been hosted on the website of the Company viz.www.celebritygroup.com .
NUMBER OF MEETINGS OF THE BOARD
The Board of Directors met 4 (four) times during the financial year 2018-19 i.e. 28thMay 2018 08th August 2018 13th November 2018 and 12th February 2019. The interveninggap between the meetings was within the period prescribed under the Companies Act 2013and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. The detailsof all Board/ Committee meetings held are given in the Corporate Governance Report.
Pursuant to Section 177 (8) of Companies Act 2013 the particulars relating to theComposition terms of reference and other details about the Audit Committee has beendetailed in the Corporate Governance Report which forms part of this Annual Report.
During the year all the recommendations of the Audit Committee were accepted by theBoard.
The Remuneration policy of the company has been structured to match the market trendsof the industry qualifications and experience of the employee and responsibilitieshandled by them.
The Policy inter alia provides for the following:
a) attract recruit and retain good and exceptional talent;
b) list down the criteria for determining the qualifications positive attributes andindependence of the directors of the Company;
c) ensure that the remuneration of the directors key managerial personnel and otheremployees is performance driven motivates them recognises their merits and achievementsand promotes excellence in their performance;
d) motivate such personnel to align their individual interests with the interests ofthe Company and further the interests of its stakeholders;
e) ensure a transparent nomination process for directors with the diversity of thoughtexperience knowledge perspective and gender in the Board; and
f) fulfill the Company's objectives and goals including in relation to good corporategovernance transparency and sustained long term value creation for its stakeholders..
Particulars pertaining constitution of the Nomination and remuneration Committee andits terms of reference has been detailed in the Corporate Governance Report which formspart of this Annual Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees covered under the provision ofSection 186 of the Companies Act 2013.
MATERIAL CHANGES & COMMITMENTS
There were no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year and the date of thisReport.
An annual performance evaluation of all Directors the Committees of Directors and theBoard as a whole for the year under review was carried out. For the purpose of carryingout performance evaluation assessment questionnaires were circulated to all Directors andtheir feedback was obtained and recorded.
DISCLOSURE AS PER THE COMPANIES (ACCOUNTS) RULES 2014
Change in nature of business if any: NIL
The name of Companies which have become or ceased to be its subsidiaries JointVentures or Associate companies during the Financial year: Not Applicable
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS OF THE COMPANY
The Company was not in receipt of any orders from the regulator / courts / tribunalsimpacting the going concern status of future operations of the Company.
The Company was in receipt of the notice / order from statutory authorities during theyear for claim not acknowledged as debts by the company. The details of the same have beenprovided in Note 41 of the financial statements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board & to theChairman & Managing Director. The Internal Auditor monitors and evaluates the efficacyand adequacy of internal control system in the Company its compliance with operatingsystems accounting procedures and policies at all locations of the Company. Based on thereport of internal audit function process owners undertake corrective action in theirrespective areas and there by strengthen the controls. A report of Auditors pursuant toSection 143(3) (i) of the Companies Act 2013 certifying the adequacy of InternalFinancial Controls is annexed with the Auditors report.
Adequate systems and processes commensurate with the size of the Company and of itsbusiness are put in place to ensure compliance with the provisions of all applicable lawsand such systems and processes are operating effectively.
Audit Committee and Board of Directors of the Company were appraised on the performanceof the IFC.
DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY
Pursuant to section 134 (3) (n) of the Companies Act 2013 the company has framed RiskManagement Policy which lays down the framework to define assess monitor and mitigatethe business operational financial and other risks associated with the business of theCompany. The Company has been addressing various risks impacting the Company in ManagementDiscussion and Analysis Report which forms part of this Annual Report.
During the year under review the company has not identified any element of risk whichmay threaten the existence of the company.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTOR
In compliance with the requirements of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has put in place a familiarization programmefor the Independent Directors to familiarize them with their role rights andresponsibility of the Directors the working of the Company nature of the Industry inwhich the Company operates business model etc.
The details of such familiarization programmes for the Independent Directors aredisclosed on the website of the Company www.celebritygroup.com .
AUDITORS Statutory Auditors
M/s SRSV & Associates Chartered Accountants Chennai were appointed as StatutoryAuditors of the Company for a period of five consecutive years at the Annual GeneralMeeting (AGM) of the Members held on 25th September 2017 on a remuneration mutuallyagreed upon by the Board of Directors and the Statutory Auditors. Their appointment wassubject to ratification by the Members at every subsequent AGM held after the AGM held on25th September 2017. Pursuant to the amendments made to Section 139 of the Companies Act2013 by the Companies (Amendment) Act 2017 effective from May 7 2018 the requirement ofseeking ratification of the Members for the appointment of the Statutory Auditors has beenwithdrawn from the Statute. Hence the resolution seeking ratification of the Members forcontinuance of their appointment at this AGM is not being sought.
The Annual Accounts of the Company including its Balance Sheet Statement of Profit andLoss and Cash Flow Statement including the Notes and Schedules to the Accounts have beenaudited by M/s. SRSV & Associates Chartered Accountants Chennai.
The Statutory Auditors' Report does not contain any qualification reservation oradverse remark on financial Statements of the Company. The Auditors' Report is enclosedwith the financial statements in this Annual Report.
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed M/s. BP & Associates Practicing Company Secretaries as theSecretarial Auditors of the Company to undertake the Secretarial Audit for the financialyear 2018-19. Secretarial Audit Report given by Secretarial Auditors is annexed with thereport as Annexure IV.
Qualification in Secretarial Audit Report:
The website of the Company has not been updated with the details required under theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 and the Companies Act 2013.
Management's Reply: The Information required to be updated on the website as per theListing Regulations were uploaded but due to revamping of website some information gotdeleted and was not available on website at the time of Secretarial Audit. However thesame has been resolved.
Pursuant to Section 138 of the Companies Act 2013 read with rule 13 of The Companies(Accounts) Rules 2014 and all other applicable provisions (including any amendmentthereto) if any of the Companies Act 2013 and as recommended by the audit committee M/s.RVKS & Associates Chartered Accountants Chennai were appointed as the InternalAuditors of the company for the Financial Year 2018-19.
The audit conducted by the Internal Auditors is based on an internal audit plan whichis reviewed each quarter in consultation with the Audit Committee. These audits are basedon risk based methodology and inter alia involve the review of internal controls andgovernance processes adherence to management policies and review of statutorycompliances. The Internal Auditors share their findings on an ongoing basis during thefinancial year for corrective action. The Audit Committee oversees the work of InternalAuditors.
COST RECORDS AND COST AUDIT
Maintenance of cost records and requirement of cost audit as prescribed under theprovisions of Section 148(1) of the Companies Act 2013 are not applicable for thebusiness activity carried out by the Company.
The equity shares of the Company are listed at the BSE Limited (BSE) and the NationalStock Exchange of India Limited (NSE). The applicable annual listing fees have been paidto the Stock Exchanges before the due dates.
DISCLOSURE UNDER SECTION 67 (3) (C) OF THE COMPANIES ACT 2013
No disclosure is required under section 67 (3) (c) of the Companies Act 2013 read withRule 16(4) of Companies (Share Capital and Debentures) Rules 2014 in respect of votingrights not exercised directly by the employees of the Company as the provisions of thesaid section are not applicable.
PARTICULARS OF EMPLOYEES
Disclosure with respect to the remuneration of Directors as required under Section 197(12) of the Companies Act 2013 read with Rule 5(1) of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed as Annexure - I to thisAnnual Report.
Statement containing Particulars of Employees pursuant to Section 197(12) of theCompanies Act 2013 read with Rule 5(2) and Rule 5(3) of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 also annexed in Annexure - I which formspart of this Annual Report.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
During the financial year 2018-19 no unpaid or unclaimed dividend was required to betransferred to IEPF.
INTERNAL COMPLAINTS COMMITTEE
The Company has in place a Policy on Prevention Prohibition and Redressal of SexualHarassment and Non-discrimination at Work Place in line with the requirements of SexualHarassment of Women at the Workplace (Prevention Prohibition & Redressal) Act 2013.All employees (permanent contractual temporary trainees) are covered under this policy.
An Internal Complaints Committee (ICC) was set up to redress the complaints receivedfrom women regarding sexual harassment and discrimination at workplace. The Constitutionof the ICC is as per the Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 and the committee includes external members from NGOs.
During the year ended 31st March 2019 the ICC did not receive any complaintpertaining to sexual harassment/discrimination at the work location.
DIRECTORS' RESPONSIBILITY STATEMENT
As required by Section 134(3)(c) and 134(5) of the Companies Act 2013 the Directorsto the best of their knowledge and ability confirm that:-
a) In preparation of the annual accounts for the financial year ended 31st March 2019the applicable accounting standards have been followed and there are no materialdepartures.
b) They have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitof the company for that period.
c) They have taken proper and sufficient care towards 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) They have prepared the annual accounts on a going concern basis.
e) They have laid down internal financial controls which are adequate and areoperating effectively.
f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal financialcontrols over financial reporting by the statutory auditors and the reviews performed bymanagement and the relevant board committees including the audit committee the board isof the opinion that the Company's internal financial controls were adequate and effectiveduring financial year 2018-19.
DISCLOSURE REGARDING FRAUDS
The Statutory Auditors of the Company has stated that there was no material fraud bythe Company or on the Company by its officers or employees was noticed or reported duringthe course of our audit in their Independent Auditors Report which forms part of thisAnnual Report. Hence there is no requirement to report the same to Audit Committee orBoard of Directors of the Company
Electronic copies of the Annual Report 2018-19 and the Notice of the 30th AnnualGeneral Meeting are sent to all members whose email addresses are registered with theCompany/Depository participant(s). For members who have not registered their emailaddresses physical copies are sent in the permitted mode.
CONSERVATION OF ENERGY / TECHNOLOGY ABSORPTION / FOREIGN EXCHANGE
A. Conservation of Energy:
The operations of the Company are not energy-intensive. However wherever possible theCompany strives to curtail the consumption of energy on a continuing basis.
|B. Technology absorption: ||Not applicable. |
|C. Foreign Exchange Earning and Outgo : || |
|a. Total Foreign exchange earned (FOB Value) ||: '193.47 Crs |
|b. Total Foreign exchange outgo ||: ' 48.02 Crs |
The Company is in compliance with the Secretarial Standards on Meetings of the Board ofDirectors (SS- 1) and Secretarial Standards on General Meetings (SS-2) issued by theInstitute of Company Secretaries of India (ICSI).
The Directors wish to place on record sincere appreciation for the support receivedfrom various Central and State Government Departments organizations and agencies. TheDirectors also gratefully acknowledge all stakeholders of the Company viz. Shareholderscustomers dealers vendors banks and other business partners for excellent supportreceived from them during the Financial Year under review. The Directors also expresstheir appreciation to all the employees of the Company for their commitment and continuedcontribution to the growth of the Company.
| ||For and on behalf of the Board |
| ||Sd/- |
| ||Venkatesh Rajagopal |
|Place: Chennai ||Chairman |
|Date: 20th May 2019 ||(DIN: 00003625) |