To the Members
Your Directors are pleased to present 29th Annual Report ofthe Company along with Audited Accounts for the financial year ended March 312020.
The audited financial statements of the Company as on March 312020 areprepared in accordance with the relevant applicable IND AS and Regulation 33 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") and provisions of the Companies Act 2013 ("Act").
The summarized financial highlight is depicted below:
|Particulars ||Current Year 2019-20 ||Previous Year 2018-19 |
|Revenue from Operations ||19491.75 ||17459.70 |
|Other Income ||114.39 ||83.45 |
|Total Income ||19606.14 ||17543.15 |
|Net Profit before Exceptional Items and Tax ||3735.08 ||3324.05 |
|Exceptional Items ||429.35 ||(437.69) |
|Profit Before Tax ||3305.73 ||3761.74 |
|Tax Expenses ||641.85 ||756.83 |
|Profit After Tax ||2663.88 ||3004.91 |
|Other comprehensive income (Net of Tax) ||(389.45) ||3.10 |
|Total Comprehensive Income for the year ||2274.43 ||3008.01 |
REVIEW OF OPERATIONS AND STATE OF AFFAIRS:
The total income of the Company for the year ended March 312020 is Rs.19606.14 Lakhs which is higher by about 11.76% over that for the previous year which wasRs. 17543.15 lakhs. The total comprehensive income for the year stood at Rs. 2274.43Lakhs in the current year against Rs. 3008.01 Lakhs in the previous year.
Your Company is India's one of the leading player in manufacturer ofCoding and Marking Machines and Consumables thereof.
In consideration of urgent necessity in healthcare / medical Industrydue to massive impact of COVID-19 Pandemic and in order to serve the Nation the Companycommenced to facilitate carrying out the new activity of manufacturing of Face Mask alongwith the present business activity of Coding and Marking. The Company has receivedin-principle approval from Director of Industries (DOI) Govt. of Himachal Pradesh forpermission to commence manufacturing of Face Mask at the Company's factory situated atNalagarh Himachal Pradesh.
No material changes and commitments have occurred after the close ofthe year till date of this report which affects the financial position of the Company.
The outbreak of COVID-19 pandemic and resulting lockdown has affectedworld economy including India leading to significant decline and volatility in economicactivities. The manufacturing facility of the Company at Nalagarh in state of HimachalPradesh and Guwahati in State of Assam including other offices at India closed from March23 2020 following Countrywide lockdown due to COVID-19.
For the Company the focus immediately shifted to ensuring the healthand well-being of all employees and on minimizing disruption to services for some of ourcustomer who are not into essential products service. As of March 31 2020 work from homewas enabled to close to 80-90% of the employees to work remotely and securely. Thisresponse has reinforced customer confidence in Control Print.
The Company since obtained required permission and commenced partialoperations at its manufacturing facilities from May 2020. The Company has made anassessment of its liquidity position and has assessed the carrying value of propertyplant & equipement investments inventories receivable and other current assets.Based on the assessment done by the Management and considering the internal and externalsources of information upto the date of approval of financials the Company expect thatcarrying amount of assets will be recovered. Since the situation is continuously evolvingthe impact assessed may be different from the estimates made as at the date of approval ofthese financials.
DIVIDEND AND RESERVES
During the year the Board of Directors of the Company at its meetingheld on January 25 2020 declared an interim dividend of Rs. 3.50 per equity share i.e. @35% for the financial year 2019-20 absorbing a sum of Rs. 689 lakhs including dividenddistribution tax. The same was paid to the shareholders on February 10 2020. Also theboard at its meeting held on March 11 2020 declared an 2nd interim dividendof Rs. 4.50 per equity share i.e. @ 45% for the financial year 2019-20 absorbing a sum of886 lakhs including dividend distribution tax. The same was paid to the shareholders onMarch 25 2020.
The Board has not recommended a final dividend and the interim dividendof Rs. 8.00 (including 2nd interim dividend) per equity share declared by theBoard on January 25 2020 and March 112020 shall be considered as the final dividend forthe Financial Year 2019-20. Thus the total dividend for the Financial Year 2019-20remains Rs. 8.00 per equity share of Rs. 10 each.
During the year under review no amount from profit was transferred toGeneral Reserve.
RECLASSIFICATION UNDER REGULATION 31A OF SEBI LISTING REGULATIONS2015:
The Company has received approval from BSE Ltd. & National StockExchange of India Ltd. for reclassification of Ms. Nyana Sabharwal from promoter group topublic shareholder in accordance with the Regulation 31A of the Listing Regulation.
Other than mentioned above there is no change in classification ofPromoter and Promoter group.
As on March 31 2020 the Company has only one wholly-owned subsidiarycompany namely "Liberty Chemicals Private Limited".
As per the provisions of Section 129(3) of the Companies Act 2013("Act") a statement containing salient features of the financial statements ofthe Company's subsidiary in Form AOC-1 is annexed as "Annexure A" and forms anintegral part of this Report. Pursuant to the provisions of Section 136 of the Act thefinancial statements along with the relevant documents and separate audited financialstatements in respect of subsidiary is available on the website of the Company.
The financial statements of the subsidiary company and relatedinformation are available for inspection by the members in electronic mode during businesshours on all days except Saturdays Sundays and public holidays upto the date of the AGMas required under Section 136 of the Act.
Any member desirous of obtaining a copy of the said financialstatements may write to firstname.lastname@example.org. The financialstatements including the consolidated financial statements financial statements ofsubsidiary and all other documents required to be attached to this report have beenuploaded on the website of your Company under the weblink: https://www.controlprint.com/investors/
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
Particulars required under Section 134(3)(m) of the Companies Act 2013read with Rule 8 of the Companies (Accounts) Rules 2014 regarding conservation ofenergy technology absorption foreign exchange earnings and outgo are given in''Annexure F" and Forms an integral part of this Report.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS
A Separate reports on Corporate Governance Report and ManagementDiscussion and Analysis as required by Listing Regulations forms part of this AnnualReport along with the required Certificate from the Statutory Auditors of the Companyconfirming the compliance of requirements of Corporate Governance as stipulated in theListing Regulation.
Your Company has not accepted any deposits from the public within themeaning of Chapter V of the Act and as such no amount of principal or interest wasoutstanding as on the balance sheet date.
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
The Company has an adequate Internal Financial Control Systemcommensurate with the size scale and complexity of its operations to ensure properrecording of financial and operational information and compliance of various internalcontrol and other regulatory and statutory compliances. Internal Audit Control Systemensures that the regular internal audits are conducted at both the factories and otherfunctional areas. The findings are then taken up by audit committee along with managementresponse for suitable action. The Company has implemented SAP ERP system it helps tominimize human errors and plugging the loopholes. The Company also has a proper andadequate system of internal controls to ensure that all assets are safeguarded andprotected against loss from unauthorized use or disposition and those transactions areauthorized recorded and reported correctly. The Company has adequate and effectiveinternal audit system covering on a continuous basis the entire gamut of operations andservices spanning all locations business and functions. The Audit Committee monitors theInternal Audit System on regular intervals and directs necessary steps to further improvethe Internal Control system.
EXTRACT OF ANNUAL RETURN
Pursuant to sub-section 3(a) of Section 134 and subsection (3) ofSection 92 of the Act read with Rule 12(1) of the Companies (Management andAdministration) Rules 2014 an extract of annual return is annexed as "Annexure -C" and forms an integral part of this Report and is also uploaded Company's websiteand can be accessed at https://www.controlprint.com/investors/annual-report/.
BUSINESS RESPONSIBILITY REPORT:
As stipulated under the Listing Regulations the BusinessResponsibility Report (BRR) describing the initiatives taken by the Company from anenvironmental social and governance perspective is annexed as "Annexure - G"and forms an integral part of this Report and is also uploaded Company's website and canbe accessed at https://www.controlprint.com/investors/annual-report/
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The details of Loans Guarantees or Investments covered under theprovisions of Section 186 of the Companies Act 2013 forms part of notes to the FinancialStatements.
RELATED PARTY TRANSACTIONS
All contracts/arrangements/transactions entered by the Company duringthe financial year with related party were on arm's length basis and were in the ordinarycourse of the business. There are no materially significant related party transactionsmade by the Company with Promoters Key Managerial Personnel or other designated personswhich may have potential conflict with interest of the Company at large. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3) (h) of theCompanies Act 2013 in Form AOC-2 is not applicable.
Your Directors draw attention of the members to Notes to accounts ofthe financial statement which sets out related party disclosures.
A statement of all related party transactions is presented before theAudit Committee on a quarterly basis specifying the nature and value of the transactions.
Your Company has formulated a Policy on Related Party Transactions andpolicy on the same as approved by the Board is uploaded on the Company's weblink viz. https://www.controlprint.com/wp-content/uploads/Related-Party-Transactions-Policv.pdf
DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors to the best of the knowledge and belief and according tothe information explanations and representations obtained by them and after due enquirymake the following statements in terms of Section 134(3)(c) and 134(5) of the Act that :
a) in the preparation of the annual accounts for the year ended March312020 the applicable accounting standards read with requirements set out under ScheduleIII to the Act have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company as at March 312020and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
d) the Directors have prepared the annual accounts on a going concernbasis;
e) the Directors have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and areoperating effectively; and
f) the Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems are adequate and operatingeffectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act2013 and the Company's Articles of Association Mr. Basant Kabra Director (DIN:00176807) retires by rotation at the forthcoming Annual General Meeting and beingeligible offers himself for re-appointment.
The Board recommends his re-appointment for the consideration of theMembers of the Company at the ensuing Annual General Meeting.
Based on the recommendation of Nomination and Remuneration Committeethe Board of Directors at its Meeting held on June 30 2020 had appointed Ms. Shruti Jatia(DIN: 00227127) as an Additional Non-Executive Independent Director of the Company witheffect from June 30 2020 to hold office up to the date of the forthcoming Annual GeneralMeeting. The Board considered knowledge and experiences of Ms. Shruti Jatia in the areasof managing finance accounts and human resource development while approving herappointment as Independent Director on the Board of the Company. The Board is of theopinion that Ms. Shruti Jatia Independent Director possesses requisite qualificationexperience and expertise and holds high standards of integrity. Being eligible Ms.Shruti Jatia offered herself to be appointed as the Independent Director of your Company.
As on the date of this report Mr. Basant Kabra Managing Director Mr.Shiva Kabra Joint Managing Director Mr. Rahul Khettry Chief Financial Officer and Ms.Reena Shah Company Secretary & Compliance Officer of the Company are the KeyManagerial Personnel of the Company in accordance with the provisions of Section 2(51)read with Section 203 of the Act.
Declaration of Independence by Independent Directors & adherence tothe Company's Code of Conduct for Independent Directors
All the Independent Directors of the Company have submitted theirdisclosure to the effect that they fulfill all the requirements/criteria of independenceas per Section 149(6) of the Act and the Listing Regulations and they have registeredtheir names in the Independent Directors' Databank. Further all the Independent Directorshave affirmed that they have adhered and complied with the Company's Code of Conduct forIndependent Directors which is framed in accordance with Schedule IV of the Act.
As per the provisions of the Act the Independent Directors not liableto retire by rotation.
BOARD MEETING HELD DURING THE YEAR
During the year five (5) meetings of the Board of Directors were heldthe details of which are given in the Corporate Governance Report that forms part of thisReport. The intervening gap between any two meetings of the Board has not exceeded morethan one hundred and twenty (120) days as stipulated under the Act and ListingRegulations.
COMMITTEE OF THE BOARD
The Board of Directors have the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. Corporate Social Responsibility Committee
The details of the Committees along with their composition number ofmeetings and attendance at the meetings are provided in the Corporate Governance Report.
PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND DIRECTORS
Pursuant to the provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board has carriedout an annual evaluation of its own performance the individual Directors (including theChairman) as well as an evaluation of the Board Committees. The Nomination andRemuneration Committee (NRC) of the Company approved a checklist for evaluation of theperformance of the Board the Committees of the Board and the Individual Directorsincluding the Chairman of the Board.
The Board adopted the checklist for performance evaluation as approvedby NRC. The performance of the Board and Committee was evaluated on the basis of thecriteria approved. The Board and the NRC reviewed the performance of the individualDirectors. In addition the Chairman was also evaluated on the key aspects of his role.
In a separate meeting of Independent Directors performance ofNon-Independent Directors performance of the Board as a whole and performance of theChairman was evaluated. The same was discussed in the Board meeting that followed themeeting of the Independent Directors at which the performance of the Board itscommittees and the individual Directors was discussed.
The Board of Directors expressed their satisfaction with the evaluationprocess.
COMPANY'S POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION
The remuneration policy of the Company is directed towards rewardingperformance based on review of achievements on a periodic basis. The Board of Directorshas approved Nomination and Remuneration policy and available at the Company's websiteunder the web link: https://www.controlprint.com/wp-content/uploads/Nomination andRemuneration-Policv.pdf
The term and reference of Nomination and Remuneration Committeedetails of Nomination and Remuneration policy and Committee Meetings are provided in theCorporate Governance Report.
The Company has formulated a Familiarization Programme for IndependentDirectors with an aim to familiarize the Independent Directors with the Company theirroles rights responsibilities in the Company nature of the industry in which theCompany operates business model of the Company etc. to provide them with betterunderstanding of the business and operations of the Company and so as to enable them tocontribute significantly to the Company.
The details of programme for familiarization of Independent Directorswith the Company are disclosed on the website of the Company under the web link https://www.controlprint.com/wp-content/uploads/Familarisation-Programme-for-Independent-Directors.pdf
AUDITORS AND AUDIT REPORT
(a) Statutory Auditors
M/s Jhawar Mantri & Associates Chartered Accountants (FirmRegistration No. 113221W) Mumbai were appointed as Statutory Auditors of the Company fora period of five consecutive years at the 26th AGM held in the year 2017 tohold office from the conclusion of 26th AGM until the conclusion of 31stAGM to be held in the year 2022.
There are no qualifications adverse remarks reservations or disclaimermade by Jhawar Mantri & Associates Statutory Auditors in their report for thefinancial year ended March 312020. The notes to the Accounts referred to in the Auditor'sReport are self-explanatory and therefore do not call for any further explanation andcomments.
(b) Cost Auditors
As per the requirement of Central Government and pursuant to Section148 of the Companies Act 2013 read with the Companies (Cost Records and Audit) Rules2014 your Company carries out an audit of cost records. The Board of Directors onrecommendation of Audit Committee has appointed Mr. Paresh Jaysih Sampat (Membership No.33451). Cost Accountants (Firm Registration No. 102421) as Cost Auditors of the Companyfor the Financial Year 2020-21.
In terms of the provisions of Section 148(3) of the Companies Act 2013read with the Rule 14(a)(ii) of the Companies (Audit and Auditors) Rules 2014 theremuneration of the Cost Auditors has to be ratified by the members. Accordinglynecessary resolution is proposed at the ensuing AGM for ratification of the remunerationpayable to the Cost Auditors for the Financial Year 2020-21.
(c) Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act 2013read with read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 M/s Nilesh Shah & Associates Company Secretaries in Practice wereappointed as the Secretarial Auditors of the Company to carry out the secretarial auditfor the year ending March 312020. The Secretarial Auditor's Report is annexed as Annexure"B" to this Report
The Secretarial Audit Report contain following observation:
There were few cases where delivery of share certificate for requestreceived relating to Transfer Transmission and Duplicate were not delivered within theprescribed time limit as specified under regulation 40 (3) of SEBI (Listing obligationsand Disclosure Requirements) Regulation 2015.
Due to spurt in the Volumes of Transfer and Demat requests onannouncement made by SEBI to disallow listed companies from accepting request for transferof securities which are held in physical form Transfer Agent could not able to processthe request on time.
The Company has strictly instructed to Share Transfer Agent to ensureeffecting investors request within statutory timeline in future and going forward shallensure to curb such delays and ensuring strict monitoring on Share Transfer Agent ofprocessing request if any.
(d) Reporting of Frauds by Auditors
During the year under review the Auditors have not reported anyinstances of frauds committed in the Company by its Officers or Employees to the AuditCommittee under Section 143(12) of the Companies Act 2013.
CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the provisions of Section 135 of the Companies Act 2013read with the Companies (Corporate Social Responsibility Policy) Rules 2014. The detailsof the CSR activities are given as Annexure-'D' forming part of this Report
VIGIL MECHANISM/WHISTLE BLOWER
The Company has formulated and established a Vigil Mechanism namedWhistle Blower Policy to deal with instances of fraud and mismanagement and to enableDirectors and Employees to report genuine concerns about unethical behavior actual orsuspected fraud or violation of Code of Conduct and to report incidents of leak orsuspected leak of unpublished price sensitive information. The employees and otherstakeholders have direct access to the Chairperson of the Audit Committee for lodgingconcerns if any for review
The Whistle Blower Policy is available on the website of your Company https://www.controlprint.com/wp-content/uploads/Vigil-Mechanism-or-Whistle-Blower-Policv.pdf
Your Company affirms that no director/ employee has been denied accessto the Chairperson of the Audit Committee and that no complaints were received during theyear
Risk Management within the organization involves reviewing theoperations of the organization identifying potential threats to the organization and thelikelihood of their occurrence and then taking appropriate actions to address the mostlikely threats.
The Company is re-visiting its approach towards risk and shallperiodically review and mitigate them through proper policies in place to manage all typesof risk majorly financial risk business risk inventory pricing risk regulatory risk andHR risk through review audit and reporting mechanism.
COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARD - 1 (SS-1) ANDSECRETARIAL STANDARD - 2 (SS-2)
The Directors have devised proper systems to ensure compliance with theprovisions of all applicable Secretarial Standards issued by the Institute of CompanySecretaries of India and that such systems are adequate and operating effectively. Thecompany has complied with SS-1 and SS-2.
During the year under review CRISIL has reaffirmed the credit ratingof CRISIL A- /Stable and CRISIL A2+ for long term and short term debt instrument/facilities respectively of the Company.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
Your Company has in place a formal policy for the prevention of sexualharassment of its women employees in line with "The Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013". During the year therewere no complaints received relating to the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013.
PARTICULARS OF EMPLOYEES
The requisite disclosures in terms of the provisions of Section 197 ofthe Act read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 along with statement showing names and
other particulars of employees drawing remuneration in excess of thelimits prescribed under the said Rules is annexure to this Report as Annexure E.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS ORCOURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
In the arbitration proceedings relating to dispute between and VideojetTechnologies Inc. and Control Print Limited the Arbitral Tribunal has given its decisionin favour of Videojet Technologies Inc. wherein it has awarded the Company to pay Rs.632.92 Lakhs with interest @12% thereon from the date of filing of statement of claim i.e.August 4 2012 to Videojet Technologies Inc. Further the Company has been awarded toreceive Rs. 100.95 Lakhs along with interest @ 12% thereon from the date of filing of setoff i.e. January 9 2013 from Videojet Technologies Inc.
The Company has filed an appeal before the Honourable Bombay HighCourt. The Honourable Court vide its order dated 28th February 2020 stayedthe award of the Arbitral Tribunal and directed the Company to furnish Bank Guarantee ofRs. 230.00 Lakhs which the Company has complied with. Since the matter is pending forfinal adjudication before the Court the Company's Management feel that no provision forany liability in this matter is considered necessary in the accounts.
Other than mentioned above there are no significant and materialorders passed by the Regulators or Courts or Tribunals which would impact the goingconcern status and the Company's future operations.
ENVIRONMENT AND SAFETY
Your Company is conscious of the importance of environmentally cleanand safe operations. Your Company endeavors that the conduct of all operations are in suchmanner so as to ensure safety of all concerned compliance of statutory and industrialrequirements for environment protection and conservation of natural resources to theextent possible.
Your Directors takes this opportunity to express their deep sense ofgratitude to high degree of professionalism commitment and dedication displayed byemployees at all levels. Your Directors also wish to thank its esteemed corporate clientsdealers agents suppliers technology partners investors Government Authorities andbankers for their continued support and faith reposed in the Company. Your Directors aredeeply grateful to the shareholders for the confidence and faith that they have alwaysreposed in the Company.
| || |
For and on behalf of the Board
| ||Basant Kabra ||Shiva Kabra |
|Place: Mumbai ||Managing Director ||Joint Managing Director |
|Date: June 30 2020 ||(DIN:00176807) ||(DIN :00190173) |