Your Directors have pleasure in presenting the Thirty Sixth Annual Report on thebusiness and operations of the Company together with the Audited Statement of Accounts forthe Financial Year ended 31st March 2017 and the report of the Auditors thereon.
1. FINANCIAL SUMMARY (STANDALONE)
|Particulars ||Year Ended 31.03.2017 ||Year Ended 31.03.2016 |
| ||Rs. ||Rs. |
|Sales ||4370043122 ||3076852743 |
|Interest ||11648350 ||7734786 |
|Other Income including Operating Income ||359939232 ||251314081 |
|Total Income ||4741630704 ||3335901610 |
|Less : Expenditure ||4495386791 ||3186284818 |
|Profit before Depreciation and Taxation ||246095554 ||149616792 |
|Less : Depreciation ||28692897 ||25450821 |
|Profit before Taxation ||217551016 ||124165971 |
|Less: Provision for Tax ||83359112 ||44777357 |
|Less: Prior Period Adjustments ||148359 ||220028 |
|Net Profit After Tax & Prior period adjustments (a) ||134043545 ||79168586 |
|Balance brought forward from last year(b) ||340318174 ||280739186 |
|Less : Transfer to General Reserve(c) ||20000.000 ||15000000 |
|Less: Proposed Dividend @ 15%(d) ||3813300 ||3813300 |
|Less: Tax on Dividend(e) ||776298 ||776298 |
|Balance Carried to Balance Sheet(a + b-c-d-e) ||449772121 ||340318174 |
Your Directors are pleased to recommend a final dividend of Rs.1.50/- per equity shareof Rs. 10/- each for the year 2016-17 subject to the approval of shareholders.
3. COMPANY PERFORMANCE
Your Company posted good financial results during the year under review. Turnover ofthe Company has increased from 307.68 Crores to 437.00 Crores and the net profit of theCompany increased from Rs. 7.91 Crores to Rs. 13.40 Crores.
4. AWARDS & RECOGNITIONS
Your Company was presented two National Awards during the year namely:
a. Outstanding Export Performance in Medium Enterprises (Manufacturing)
b. Outstanding Entrepreneurship in Medium Enterprises
on 27.06.2017 by Shri. Kalraj Mishra the Union Minister of Micro Small & MediumEnterprises Shri Hari Bhai Chaudhary Union Minister of State for MSME and Shri GirirajSingh Union Minister of State for MSME.
5. PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES ASSOCIATES AND JOINTVENTURE COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENT.
Continental Fisheries India Private Limited
Continental Fisheries India Private Limited is a Wholly Owned Subsidiary of theCompany which has been established with an objective of promoting products of the Companyin the domestic market and during the year the Company started its operations at Nelloreby entering into an agreement with The Waterbase Limited.
Seacrest Seafoods Inc.
Seacrest Seafoods Inc. is a Wholly Owned Subsidiary of the Company which has beenestablished in the Year 2015 in the State of Delaware U.S.A. for importing anddistribution of sea foods in the American whole sale Markets.
The Statement containing the salient features of the financial statement ofSubsidiaries as per subsection (3) of Section 129 of the Companies Act 2013 in Form AOC -1 is herewith annexed as Annexure - 1 to this report.
6. NUMBER OF MEETINGS OF THE BOARD
Four (4) meetings of the Board were held during the year. For details of the meetingsof the Board please refer to the Corporate Governance report which forms part of thisreport.
7. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All contracts/ arrangements/ transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis.
There are no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.
All related party transactions are placed before the Audit Committee as also the Boardfor approval. Prior omnibus approval of the Audit Committee is obtained as per SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 for the transactionswhich are of a foreseen and repetitive nature. The Company has developed a Policy onRelated Party Transactions for the purpose of identification and monitoring of suchtransactions.
Particulars of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is appended as Annexure -2 to this report.
These have been discussed in detail in the Notes to the Standalone Financial Statementsin this Annual Report.
The Company has not accepted any fixed deposits attracting the provisions of theCompanies Act 2013 and as such no amount of principal or interest was outstanding as ofthe Balance Sheet date.
9. STATUTORY AUDITORS
The period of appointment of M/s. K.P Rao Associates Chartered Accountants Hyderabad(Firm Reg. No. 003136S) as the Statutory Auditors of the Company expires at this AnnualGeneral Meeting. Pursuant to the provisions of Section 139(2) of the Companies Act 2013the existing Auditors cannot be reappointed at the ensuing Annual General Meeting and theBoard recommends the appointment of M/s. K.P Rao & Co Chartered AccountantsBangalore (Firm Reg. No. 03135S) as Statutory Auditors to hold office for a period offive consecutive financial years from the conclusion of this Annual General Meetingsubject to ratification of their appointment at every Annual General Meeting. Necessarycertificate has been obtained from the Auditors as per Section 139(1) of the CompaniesAct 2013. The Auditor's observations are suitably explained in notes to the Accounts andare self-explanatory.
10. SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. ASN Associates a firm of Company Secretaries in Practice to undertake theSecretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as'Annexure 3' to this report.
11. INTERNAL AUDITORS
The Board of Directors based on the recommendations of the Audit Committee haveappointed M/s. Seshagiri Rao & Associates Chartered Accountants Hyderabad for thefinancial year 2017-18 who has to act in an Independent manner and also responsible forregulatory and legal requirements relating to operational processes and internal systems.They report directly to the Board of Directors.
12. CREDIT & GUARANTEE FACILITIES
The Company has been availing Packing Credit limits and Term Loan and other facilitiesfrom Bank of India Main Branch Visakhapatnam.
13. PARTICULARS REGARDING ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as "Annexure4" to this report.
14. MANAGEMENT DISCUSSION ANALYSIS
Pursuant to the provisions of Regulation 34(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a report on Management Discussion &Analysis is herewith annexed as "Annexure 5" to this report.
15. CORPORATE GOVERNANCE
The Company has been making every endeavor to bring more transparency in the conduct ofits business. As per the requirements of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a compliance report on Corporate Governance for the year2016-17 and a Certificate from the Auditors of the Company are furnished which form partof this Annual Report as Annexure - 6 & 7.
16. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company as part of its Corporate Social Responsibility (CSR) initiative undertookprojects like sanitation development facilitating pure drinking water by setting up ROPlant to the identified rural areas at and around the factory at Yelamanchili AndhraPradesh and also a proposal for installation of LED lights at and around the Factorypremises is yet to materialized in the years to come.
The Annual Report on CSR activities is annexed herewith as 'Annexure 8' to this report.The CSR Policy is posted on the website of the Company.
The CSR initiatives of your Company were under the thrust areas of:
1. Health: Affordable solutions for healthcare through improved access awareness andhealth seeking Behavior Sanitation.
2. Skill Development: Access to quality education training and skill enhancement.
17. EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3)(a) of the Companies Act 2013 an extract of theAnnual Return in the Form No. MGT - 9 is appended as Annexure - 9 to the Board's report.
18. INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.
19. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Based on the recommendation of Nomination and Remuneration Committee and subject toapproval of the shareholders in the ensuing Annual General Meeting the Board of Directorshave appointed Mr. G.VV Satyanarayana as Whole Time Director of the Company for a periodof five years designated as Director- Finance Accordingly resolutions seeking approvalof Shareholders are included in the Notice convening the Annual General Meeting.
In accordance with the provisions of Section 152 of the Companies Act 2013 Mrs. JeejaValsaraj Director of the Company retire by rotation and being eligible have offeredherself for re appointment.
All the Independent Directors have given declarations stating that they meet thecriteria of independence as per the provisions of Section 149 of the Companies Act 2013and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
There was no resignation / appointment and removal of any Key Managerial Personnelduring the year. The company has designated Mr. G.VV Satyanarayana as CFO of the Companyw.e.f. 12.07.2016 in addition to his responsibilities as Director - Finance.
A brief profile of the Directors of the Company is annexed herewith as Annexure 10 tothis report.
20. DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL ANDPARTICULARS OF EMPLOYEES AS PER SECTION 197(12) UNDER RULE 5(2) OF THE COMPANIES(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is herewith annexed as Annexure - 11 to this report.
21. DIRECTORS' RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 134 (3) (C) OF THECOMPANIES ACT 2013
Pursuant to Section 134 (5) of the Companies Act 2013 your Directors confirm that tothe best of their knowledge and belief and according to the information and explanationobtained by them
(a) In the preparation of the annual accounts for the Financial Year ended March 312017 the applicable accounting standards had been followed along with proper explanationrelating 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 had taken proper and sufficient care towards the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;
(d) The directors have prepared the annual accounts for the financial year 2016-17 on agoing concern basis;
(e) The directors have laid down internal financial controls which are adequate andare operating effectively; and
(f) The directors have devised proper systems to ensure compliance.
22. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS OR TRIBUNALS
There were no significant and material Orders passed by the Regulators or Courts orTribunals impacting the going concern status and Company's operations in future.
23. MATERIAL CHANGES AND COMMITMENT
There were no material changes and commitments affecting the financial position of theCompany that have occurred between the end of the Financial Year 2016-17 of the Companyand the date of the report.
24. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy framed to deal with instance of fraud andmismanagement if any in the Group. The details of the Policy are explained in theCorporate Governance Report and also posted on the website of the Company(www.coastalcorp.co.in).
25. RISK MANAGEMENT POLICY
The Company reviews the process of risk management in your Company. Risk management isinterlinked with the annual planning exercise. During the year the Company managesmonitors the principal risks and uncertainties that can impact its ability to achieve itsstrategic objectives.
26. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS PURSUANT TO SECTION 186 OF THECOMPANIES ACT 2013
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
27. ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OFDIRECTORS
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out the annualperformance evaluation of its own performance the Directors individually as well as theevaluation of the working of its Audit and other Committees.
An exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgement safeguarding the interest of theCompany and its minority shareholders etc.
The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman and the Non Independent Directors wascarried out by the Independent Directors who also reviewed the performance of theSecretarial Department. The Directors expressed their satisfaction with the evaluationprocess.
28. HUMAN RESOURCES
Your Company considers its Human Resources as the key to achieve its objectives.Keeping this in view your Company takes utmost care to attract and retain qualityemployees. The employees are sufficiently empowered and such work environment propels themto achieve higher levels of performance. The unflinching commitment of the employees isthe driving force behind the Company's vision. Your Company appreciates the spirit of itsdedicated employees.
29. PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE
Your Company strongly supports the rights of all its employees to work in anenvironment free from all forms of harassment. The Company has also constituted anInternal Committee known as Anti Sexual Harassment Committee to address the concerns andcomplaints of sexual harassment and to recommend appropriate action. The Committee aims toprovide protection to Employees at the workplace and prevent and redress complaints ofsexual harassment and for matters connected or incidental thereto with the objective ofproviding a safe working environment where Employees feel secure. There were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
Your Directors take this opportunity to express their sincere appreciation to theshareholders customers bankers suppliers and other business associates for theirexcellent support and cooperation extended by them.
Your Directors gratefully acknowledge the ongoing co-operation and support provided bythe Central and State Governments Stock Exchanges SEBI RBI and other Regulatory Bodies.
| ||On behalf of the Board |
| ||For COASTAL CORPORATION LIMITED |
| ||Sd/- ||Sd/- |
|Place: Visakhapatnam ||(T VALSARAJ) ||(G.V.V SATYANARAYANA) |
|Date: 08.08.2017 ||MANAGING DIRECTOR ||DIRECTOR-FINANCE |