Your Directors have pleasure in presenting the 41st Board's Report alongwith the Balance Sheet the Statement of Profit and Loss the Statement of Changes inEquity and the Statement of Cash Flows for the financial year ended March 31st2020.
|PARTICULARS ||CURRENTYEAR ENDED 31-03-2020 ||PREVIOUS YEAR ENDED 31-03-2019 |
| || || |
| || || |
| ||( ? in Lakhs) ||( ? in Lakhs) |
|Revenue from operations ||13382.01 ||13288.42 |
|Other income ||53.81 ||73.93 |
|Total revenue ||13435.82 ||13362.35 |
|Total Expenses before Depreciation & amortisation expenses and Finance costs ||12627.51 ||12370.50 |
|Profit before depreciation & amortisation Finance costs and Tax expense ||808.31 ||991.85 |
|Less: Depreciation / Amortisation / Impairment ||146.33 ||97.86 |
|Profit before Finance costs ||661.98 ||893.99 |
|and Tax expense || || |
|Less Finance costs ||440.20 ||424.27 |
|Profit before Tax expenses ||221.78 ||469.72 |
|Tax expenses : || || |
|Current tax ||84.08 ||137.52 |
|Earlier year tax expenses ||2.49 ||(6.71) |
|Deferred tax ||(45.51) ||37.13 |
|Profit for the period from continuing operations ||180.72 ||301.78 |
|Other Comprehensive Income (Net of Income tax) || || |
|) Item that will not be reclassified to profit or (loss) ||(125) ||(8.45) |
|ii) Income tax relating to items that will not be reclassified to profit or (loss) ||0.34 ||2.33 |
|Total Comprehensive income for the year ||179.81 ||295.66 |
COMPANY'S PERFORMANCE AND STATE OF AFFAIRS FOR FINANCIAL YEAR 2019-20
The Revenue from Sale of Products for the current year ended 31.03.2020 wasRs.13338.38 Lakhs against previous year's sales of Rs.13219.56 Lakhs - registeringmarginal growth of about 0.90 % over the previous year. The exports were also stagnant atRs.311.63 Lakhs (Previous year 315.55 Lakhs) in F.O.B value terms. The Revenue fromservices for the current year amounted to Rs.6.78 Lakhs (Previous year Rs.6.36 Lakhs).Other Operating Income was?36.85 Lakhs (Previous Year 62.50 Lakhs) which includes ExportIncentives viz. Duty Drawbac Rs.5.24 Lakhs (Previous Year Rs.5.71 Lakhs) & PFSLRs.17.64 Lakhs (PreviousYear Rs.18.70Lakhs).
The global economy grew at its slowest pace in 2019 amidst escalation of trade tensionsbetween China and the US uncertainty over Brexit and heightened geo-political risks.Economic activity in India slowed down in 2019-20 as a synchronised global downturn. TheMay 2020 release of provisional estimates (PE) of national income by the NationalStatistical Office (NSO) for 2019-20 revealed that the growth of India's real grossdomestic product (GDP) had slumped to 4.2 per cent in 2019-20 the lowest since 2009-10.GDP grew year on year from 5.5% in 2012-13 and peaked to 8.3% in 2016-17 and thereafterstarted decelerating. registering growth of 7% in 2017-18 and 6.1% in 2018-19. The marketdemand remained stagnant due to decelaration in the growth of the Indian economy anddifficult global economy. The macro-economic environment had been challenging with lowerGDP growth rates.
Towards the close of the year the novel coronavirus (COVID-19) broke out and rapidlyexploded into a pandemic darkening global economic prospects and imparting extremeuncertainty about the outlook. The COVID-19 pandemic forced governments to enforcelock-downs putting almost all economic activities to halt.
Our company's operations were also impacted by the COVID-19 pandemic during the lastpart of the 4th quarter resulting in loss of revenue. The company could not push its yearend sales due to countrywide lockdown in March 2020.Our company Manufactures/deals inSports goods and Health & Fitness Equipments/Goods/Accessories. EducationalInstitutions Schools and Gyms are closed since March 2020. Sporting events have beeneither deferred/ cancelled. It has impacted our business.
However there is demand of Sports goods and Health & Fitness goods fromIndividuals and Households. Demand of our products is gradually picking up pursuant togradual relaxations by the Government in the unlocking process and is expected to behigher in the second half of the current year and the sales revenue shall be progressive.The management is quite hopeful that the company during the current year will match lastyear revenues with better profitability and will be on the growth path in the subsequentyears.
Our Company shall review the long term impact of the COVID-19 pandemic and take allsteps necessary to adapt itself to emerging changes and the new normal. The economicfallouts of this is still difficult to assess as the situation is still evolving.
Government has initiated various measures to boost the economy including direct benefittransfer increased allocations to key sectors like infrastructure agriculture MSMEsetc. Reserve Bank of India has cut repo rate by 185 bps on a cumulative basis to supportthe aggregate demand and private investment as well as ease liquidity given the COVID-19situation. The reduction in corporate tax rate is a big boost to the industry; it makesIndia much more competitive globally and should accelerate investments in the economy.
The Management strategic objective is to build a sustainable organization that remainsrelevant to the agenda of our clients while creating growth opportunities for ouremployees and generating profitable growth for our investors. The Company has not laid offany employee due to Covid-19 Pandemic situation.
The Management focused to ensure health and well being of all its Employees and hastaken all necessary safety measures to run the organization.
The Net Worth of the Company as at 31.03.2020 was Rs.3920.95 Lakhs (PreviousYear?3741.14 Lakhs).
'COSCO' is a leading brand in the Sports and Fitness segment in the domestic market.The Management is continuously taking effective steps to further enhance 'COSCO' BrandValue. The Company manufactures/source internationally at competitive prices qualityproducts and develop/source new products on regular basis. The Company is expanding itsproduct range of quality products and the marketing network in its endeavor to improve topline as well as net margins. The company is also planning for import substitution of someof its products under 'Aatma Nirbhar BharatAbhiyan'.
Status of Investments made in the erstwhile Subsidiary Company M/s Cosco Polymer Lanka(Private) Limited (CPLPL): As reported in earlier year(s) M/s Cosco Polymer Lanka(Private) Limited has been scheduled in the Revival of Underperforming Enterprises orUnderutilized Assets Act No 43 of 2011(of Sri Lanka). The Shares of the WOS are vested inSecretary to the Treasury of Government of Sri Lanka pursuant to acquisition by theGovernment under 'Revival of Under Performing Enterprises or Under Utilized Assets Act ofSri Lanka (Act No. 43 of 2011)'. Competent Authority appointed under the Act iscontrolling administering and managing such Enterprises/Units/Assets. The Act (of SriLanka) provides for payment of compensation to the Shareholders. The CompensationTribunal vide its letter Ref: Com T/01/27 dated 08.12.2015 has allowed compensation ofLKR 480 lakhs (Equivalent INR 204.66 lakhs) and after deducting LKR 16.74 lakhs (due forBoard of Investment (BOI) of Sri Lanka as at the date of vesting the net compensationpayable is LKR 463.26 lakhs (Equivalent INR 197.52 lakhs). The amount is yetto be releasedand the same shall be credited to Liquidator since Cosco Polymer Lanka (Private) Ltd. hasbeen ordered to be wound up by the Hon'ble High Court of the Western Province (ExercisingCivil Jurisdiction in Colombo (Sri Lanka)- Case Ref. No. HC (Civil) 40/2013(CO). Themanagement does not expect any net realisable value of its investment in the erstwhilesubsidiary. However realisation if any shall be accounted for in the year of actualreceipt.
"Consolidated Financial Statements" as per Accounting Standard 21/Ind AS 110issued by the Institute of Chartered Accountants of India have not been prepared sincethe company is under liquidation.
Board does not recommend any dividend for Financial Year 2019-20 to consolidatefinancial position of the Company. TRANSFERS TO RESERVES
The opening balance of General Reserve is?1125.17 Lakhs and same is retained on31.03.2020. The Board of Directors of your company has decided not to transfer any amountto the Reserves for the year under review. The balance in Retained earnings includeCurrent year's Net Profit from continuing operations 180.72 Lakhs (Previous year ?301.78Lakhs).
Pursuant to the provisions of Sections 134 (3)(c)and 134(5) of the CompaniesAct 2013your Directors to the best of their knowledge and belief and according to the informationand explanations obtained by them and based on the internal controls compliance systemsestablished and maintained by the Company make the following statement that:
i. in the preparation of the annual accounts for the year ended 31st March2020 the applicable accounting standards have been followed along with properexplanationrelating to material departures if any;
ii. 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 as at 31st March 2020 and ofthe profit of the Company for the year ended on that date;
iii. 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;
iv. the Directors have prepared the annual accounts on a going concern basis;
v. the Directors have laid down internal financial controls to be followed by theCompany and generally such internal financial controls are adequate and operatingeffectively; and
vi. the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company the work performed by the internal statutoryand secretarial auditors and external consultants including the audit of internalfinancial controls over financial reporting by the statutory auditors and the reviewsperformed by management and the relevant board committees including the audit committeethe Board is of the opinion that the Company's internal financial controls were adequateand effective during FY 2020 except in certain areas which need improvement as reportedby theAuditors and the management shall take effective steps for the needful.
Mr. Neeraj Jain (DIN: 00190592) Director of the Company retire by rotation at theensuing Annual General Meeting and being eligible offer himself for re-appointment.Board recommends his reappointment.
The term of appointment of Mr. Arun Jain (DIN:01054316) Mr. Manish Jain (DIN:00191593) Mr. Pankaj Jain (DIN: 00190414) and Mr. Neeraj Jain (DIN: 00190592) as wholeTime Director(s)of the Company expire on 30th September 2020. The Boardrecommends their reappointment as whole Time Directors of the Company for further periodof 3 years w.e.f 1st October 2020 to 30th September 2023 upon theremuneration terms and conditions as set out in the notice of the ensuing Annual GeneralMeeting and same is approved by the Nomination and Remuneration Committee as per theprovisions of the CompaniesAct 2013 and Schedule V of the CompaniesAct 2013 and Rulesframed thereunder. The Resolutions seeking approval of the members for the re-appointmentof Mr.Arun Jain Mr. Manish Jain Mr. Pankaj Jain and Mr. Neeraj Jain have beenincorporated in the notice of the forthcoming Annual General Meeting of the Company alongwith the brief details about them.
Company Non-Executive & Independent Directors Shri Mahavir Prasad Gupta ShriMohal Lal Mangla and Shri Vijay Kumar Sood have attained the age of 75 years.
Company has already taken members approval by Special Resolution(s) passed in the 38thAnnual General Meeting held on 29th September 2017 for their Re-appointment assecond term of office from 1st October 2017 to 30th September2022.
Further as perthe provisions of the SEBI (Listing Obligations and DisclosureRequirements)(Amendment) Regulations 2018 notified on 9th May 2018 approvalof the shareholders by way of a special resolution is required for continuation ofdirectorship of the non-executive directors of the Company who have attained the age of 75years. The proposed Special Resolutions at Item No. 78 and 9 mentioned in the 41stAGM Notice are for the endorsement/ratification of the earlier Special Resolution(s)passed in the38thAnnual General Meeting for their continuation as IndependentDirectors oftheCompanytilltheir2nd terms which ends on 30thSeptember 2022.
Pursuant to the provisions of section 203 of the Companies Act 2013 the keymanagerial personnel of the Company are:-
Shri Devinder Kumar Jain (DIN: 00191539) - Managing Director and Chief ExecutiveOfficer of the Company and Shri Narinder Kumar Jain (DIN: 00195619)- Managing Director ofthe Company who were reappointed fora period of Three (3) years with effect from 16thMarch 2019 till 15th March 2022 in the Annual General Meeting held on 29thSeptember 2018. Mr. Pankaj Jain (DIN:00190414)-Whole Time Director and CFO of theCompany.
Ms. Sudha Singh -Company Secretary w.e.f 1st May 2015.
Pursuant to the provisions of Section 149 of the Companies Act 2013 which came intoeffect from April 1st 2014 Shri Mahavir Prasad Gupta (DIN 00190550) ShriSunil Jain (DIN 00387451) Shri Mohan Lal Mangla (DIN 00311895) Shri Vijender Kumar Jain(DIN 06423328) Shri Vijay Kumar Sood (DIN 01525607) and Ms. Nisha Paul (DIN 00325914)were reappointed for their 2nd Term as Independent Directors of the Companyw.e.f 1st October 2017 to 30th September 2022 at the Annual GeneralMeeting of the Company held on 29th September 2017 for a term of 5 years Theterms and conditions of appointment of Independent Directors are as per Schedule IV of theCompaniesAct 2013.
During the year the non-executive directors of the Company had no pecuniaryrelationship or transactions with the Company other than the payment of sitting fees andreimbursement of expenses if any incurred by them for the purpose of attending meetingsof the Company.
All Independent Directors of the Company have given declarations under Section 149(7)of the Act that they meet the criteria of independence as laid down under Section 149(6)of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations. In terms ofRegulations 25(8) of the Listing Regulations the Independent Directors have confirmedthat they are not aware of any circumstance or situation which exists or may bereasonably anticipated that could impair or impact their ability to discharge theirduties with an objective independent judgement and without any external influence.
None of the Director is disqualified from being appointed as Director in terms ofsection 164 of the CompaniesAct 2013 and they have given their consent in writing to actas Director(s).
MEETINGS OF THE BOARD
During the year 2019-2020 Six (6) Board Meetings and Four (4) Audit Committee Meetingswere held. In accordance with requirement other committee meetings were held from time totime and one separate meeting of Independent Directors was also held. Relevant details ofthe meetings are given in the Corporate Governance Report which form part of this report.
Pursuant to the provisions of Section 134 (3) (p) of the CompaniesAct 2013 and therules made thereunder the Board required to carry out the Annual Performance Evaluationof the Board its Committees and individual Directors. Additionally as per provision ofRegulation 17 (10) of SEBI (LODR) Regulations 2015 the performance evaluation of theindependent directors was also to be done by the Board of Directors.Accordingly The boardof directors has carried out an annual evaluation of its own performance board committeesand individual directors including the Independent Directors (wherein the concerneddirector being evaluated did not participate).
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. In aseparate meeting of independent directors performance of non-independent directorsperformance of the board as a whole and performance of the Managing Directors wereevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting at which the performance of theboard its committees and individual directors was also discussed.
Performance evaluation of independent directors was done by the entire board excludingthe independent director being evaluated.
POLICY ON DIRECTORS'APPOINTMENT AND REMUNERATIONAND OTHER DETAILS
The Company's policy on directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act (salient features) has been briefly disclosedhereunder;
Selection and procedure for nomination and appointment of Directors
The Policy of the Company on director's appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand other matters as required under sub-section (3) of Section 178 of the CompaniesAct2013 is available on the Company website www.cosco.in
In terms of the provisions of Section 178(3) of the Act and Regulation 19 of the SEBIListing Regulations the NRC has formulated the criteria for determining qualificationspositive attributes and independence of Directors. The key features of which are asfollows:
Qualifications - The Board nomination process encourages diversity of thoughtexperience knowledge age and gender. It also ensures that the Board has an appropriateblend of functional and industry expertise.
PositiveAttributes - Apart from the duties of Directors as prescribed in theAct theDirectors are expected to demonstrate reasonable standards of ethical behaviorcommunication skills and independent judgment. The Directors are also expected to abide bythe respective Code of Conduct as applicable to them.
Independence - ADirector will be considered independent if he / she meets the criterialaid down in Section 149(6) of the Act the Rules framed thereunder and Regulation16(1)(b)ofthe SEBI Listing Regulations.
The Directors affirm that the remuneration paid to Directors KMPs and employees is asper the Remuneration Policy of the Company.
The Company has internal control systems inter alia including system of internalfinancial controls commensurate with the size and scale of its business operations. Thesystem of internal financial control strives to ensure that all transactions areevaluated authorized recorded and reported accurately and that all assets aresafeguarded and protected against losses that may arise from unauthorized use ordisposition. Based on the framework of internal financial controls and compliance systemsput in place by the Company and the reviews performed by management and the auditcommittee the board is of the opinion that the Company's internal financial controls wereadequate and effective during the financial year 2019-20. The company will furtherstrengthen its Internal Financial Controls in areas observed by theAuditors.
The Company has adopted accounting policies which are in line with the IndianAccounting Standards notified under Section 133 of the CompaniesAct 2013 read togetherwith the Companies (IndianAccounting Standards) Rules 2015. These are in accordance withGenerally Accepted Accounting Principles in India. Changes in policies if any areapproved by theAudit Committee in consultation with the StatutoryAuditors.
The details in respect of internal control and their adequacy included in themanagement discussion & analysis forms part of this report.
The current auditors viz. M/s. V.P. Jain & Associates Chartered Accountants (Firmregistration number: 015260N) were appointed by the members at their Annual GeneralMeeting held on 29th September 2017 to hold the office of auditor from theconclusion of the Thirty-Eighth Annual General Meeting till the conclusion of thisForty-third Annual General Meeting. The requirement to place the matter relating toappointment of auditors for ratification by members at every AGM has been done away by theCompanies (Amendment)Act 2017 with effect from May 7th 2018. Accordingly noresolution is being proposed for ratification of appointment of statutory auditors at theensuing AGM and a note in respect of same has been included in the Notice forthisAGM.
M/s. V.P. Jain & Associates have confirmed their eligibility and qualificationrequired under section 139 and 141 and other applicable provisions of The Companies Act2013 and Rules issued thereunder (including any statutory modification(s) or re-enactmentthereof for the time being in force).
Pursuant to Section 141 of the Act the Auditors have represented that they are notdisqualified and continue to be eligible to act as theAuditors of the Company.
INDEPENDENT AUDITORS' REPORT
The Auditors' have given Qualified Opinion regarding non conduction of physicalverification of Inventories by the Management on the Reporting date due to Covid-19Pandemic lockdown. The process of physical verification of Inventories by the managementwas carried out on subsequent dates. As reported by the Auditors - Management conductedphysical verification of its inventories on April 27 2020 in factory at Gurugram and atother locations on different dates (within lockdown period) and applied roll backprocedure to reach the reporting date quantity. The Auditors were not able to attend thephysical verification as lockdown was effective. Accordingly the Auditors have givenqualified opinion that they were unable to verify the existence/condition of inventoriesof ?408 Lakhs raw material ?445 Lakhs work-in-progress?1322 Lakhs finished goodsRs.2998 Lakhs stock-in-trade and ?118 Lakhs store items to determine the adjustments thatmay be required to be made in the value of inventory and consequential effect thereof onfinancial statement as on March 312020.
The basis of qualified opinion of the Auditors is self explanatory and need no furtherexplanation. However the management confirms that the value of Inventories as on31.03.2020 as stated in the Financial Statements is true and fair.
TheAuditors' Report do not contain any other qualifications or adverse remarks exceptfor drawing attention in respect of the matters reported under Emphasis of the Matter. Theopinion of theAuditors is not qualified in respect of matters reported under Emphasis ofthe Matter. Auditors have drawn attention to some specific Notes on Financial Statementsviz: Note no. 3.1 regarding possession of land in dispute Note no. 5.3 regardingrecoverable amount of land compensation Note no. 8.2 & 8.4 regarding valuation of nonmoving and slow moving stock Note no. 9.2 regarding provision for expected credit lossNote no. 13.1 regarding reconciliation of GST Input Note no. 19.1 regardingidentification of MSME suppliers Note no. 38.3 regarding value of investment in erstwhilesubsidiary of company and Note no. 38.5 regarding impact of COVID-19 which are selfexplanatory.
As stated in Note no. 3.1 the possession of Land belonging to the Company bearingKhasra no. 420 total area measuring 1 bigha 19 biswas and 3 biswansi situated at villageGurgaon is in dispute and company has filed a suit for getting possession of the same.Amount of Land Compensation Claim Receivable as per Note no. 5.3 is on account of enhancedcompensation awarded by the Court in respect of acquisition of land of about 325 sq. yardsof factory land by PWD (B&R) Gurugram and we are pursuing with PWD legally to recoverthe same. The slow moving inventories are valued at realistic realizable value and theManagement is taking effective steps to liquidate them. Company has system of creatingprovision of doubtful debts usually for outstanding more than 3 years. Company has notmade any provision for expected credit loss as the same is not considered to besignificant. The GST Input receivable of Rs.58.14 Lakhs is under reconciliation withelectronic credit ledger balance of ?14.71 Lakhs. The information regarding Micro Smalland Medium enterprises have been determined to the extent such parties are identified onthe basis of information available with the Company which has been relied upon bytheAuditors. The status of the investment in the erstwhile subsidiary has been dulyexplained in the within referred Note No. 38.3 on Financial Statements and alsohereinabove under Company's Performance and State of Affairs. Having regard to the factualstate of affairs of the erstwhile Subsidiary (Under Liquidation) the Management do notexpect any net realization from its investment in the said Subsidiary. Regarding theAuditors' observation w.r.t. the Internal Audit System of the company the same isreasonably effective having regard to the size of the company. However the Managementshall review scope coverage and compliance thereof to further strengthen the same.
We have taken note of the observations of the Auditors for improvement in certain areasof Internal Financial Controls and the Company's Management will take necessary steps formore effective monitoring of Inventory levels; better documentation and MIS in areas ofAnnual procurement of materials & Expense budget Procurement Budgeting & Planningof Traded Goods Obtention of Quotation Management Negotiation & Selection;Improvement in Dealers selection and appointment to prevent appointment of noncreditworthy dealers; Monitoring of Trade Receivables and to follow-up old TradeReceivables outstanding for more than one or two years for their recovery on prioritybasis; HR attendance monitoring to prevent attendance modification & excess payment ofsalary and for scientifically designing performance documentation; ensuring verificationof all fixed assets in scale of 3 years; Contract labour management and Improvement toprevent penal provisions for any non compliance of Statutory laws by contractor(s);
The Statutory Auditor of the Company has not reported any fraud as specified under thesecond proviso to Section 143(12)oftheAct.
SECRETARIAL AUDITORS' REPORT
Report of the Secretarial Auditor is given as an "Annexure-A" which formspart of this Report. Secretarial Auditors' Report do not contain any qualificationsreservations adverse remarks or disclaimers which needs any comments/explanation.
M/s PARM & Associates LLP (formerly known as PARM&SMRN Associates) CharteredAccountants performs the duties of InternalAuditorsofthe Company and their report isreviewed by the audit committee from time to time.
As per the Companies (Cost Records and Audit) Rules 2014 as amended by the Companies(Cost Records and Audit) Amendments Rules 2014 and 2016 the maintenance of Cost Recordshas not been specified by the Central Government and as such CostAudit is not applicableto our Company.
The composition terms of reference etc. of the Audit Committee is provided inCorporate Governance Report which forms part of this Annual Report. There have been noinstances of non-acceptance of any recommendations of the Audit Committee by the Boardduring the financial year under review.
NOMINATIONAND REMUNERATION COMMITTEE
The details pertaining to composition of Nomination and Remuneration Committee areincluded in the Corporate Governance Report which forms part of this report.
Policy on determining the criteria for determining qualifications positives attributesand independence of a director is available on the Company website www.cosco.in.
CORPORATE SOCIAL RESPONSIBILITY
The details pertaining to composition of Corporate Social Responsibility Committee areincluded in the Corporate Governance Report which forms part of this report.
During the financial year ended 31st March 2020 the company incurred CSRExpenditure of Rs.11.52 Lakhs (Rupees Eleven Lakhs Fifty-Two Thousand only). The CSRinitiatives of the Company were under the thrust areas of Education. The contents of theCSR Policy of the Company as approved by the Board on the recommendation of the CSRcommittee is available on the website of the Company and can be accessed through the weblink; https://www.cosco.in/uploads/investors/corporate social responsibility policy1499423528.pdf.
The Company's CSR Policy Statement and annual report on the CSR activities undertakenduring the financial year ended 31st March 2020 in accordance with Section135 of the Companies Act 2013 and Companies (Corporate Social responsibility Policy)Rules 2014(including any statutory modification(s) or re-enactment thereof for the timebeing in force) is set out in the "Annexure G" to this report.
The Company has an integrated risk management framework through which it identifiesmonitors mitigates and reports key risks that impacts its ability to meet the strategicobjectives. A note on the policy of the Company on risk management is provided in thisAnnual Report under Management Discussion and Analysis Report (Refer Annexure -'F' whichform part of this report).
PARTICULARS OF LOANS GUARANTEES INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013
The particulars of loans guarantees and investments have been disclosed inthefinancial statements.
No additional Loans given Guarantee provided or Investment made by the Company duringthe reporting year which are covered under the provisions of Section 186 of theCompaniesAct 2013.
TRANSACTIONSWITH RELATED PARTIES
All transactions entered with related parties for the year under review were on anarm's length basis and placed before theAudit Committee on regular basis. Omnibus approvalwas obtained for transactions which are of repetitive nature.
There are no materially significant related party transaction that may have potentialconflict with interest of Company at large. The details of RPTs during FY 2019-20including transaction with person or entity belonging to the promoter/ promoter groupwhich hold(s) 10% or more shareholding in the Company are provided in the accompanyingfinancial statements
Information on transactions with related parties pursuant to section 134(3)(h) of theAct read with Rule 8(2) of the Companies (Accounts) Rules 2014 are given in"Annexure-B" in FormAOC -2 and the same form part of this report.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THEFINANCIALYEARAND DATE OF REPORT
Covid-19 pandemic has partially impacted the business operations of the Company. Asdiscussed herein before in this report. Apart from that there are no material changesaffecting the affairs of the company which have occurred between the end of the financialyear of the company to which thefinancial statements relate and the date of this report.
CHANGEIN THE NATURE OF BUSINESS
There is no change in the nature of the business during the financial year underreview.
EXTRACT OFANNUAL RETURN
As provided under Section 92(3) of the Act the extract of Annual Return is given in"Annexure-C" in the prescribed Form MGT-9 which form part of this report.
Your Company does not have any subsidiary/joint venture/ associate company within themeaning of the Companies Act 2013.
In terms of Section 149 of the Companies Act 2013 and the SEBI Listing Regulations AllIndependent Directors of the Company have given declarations under Section 149(7) of theAct that they meet the criteria of independence as laid down under Section 149(6) of theAct and Regulation 16(1)(b)ofthe SEBI Listing Regulations and they have complied with theCode of Independent Directors as prescribed in Schedule IV to the Act. All IndependentDirectors name have been included in the data bank of independent directors maintained byIndian Institute of Corporate Affairs and the same is valid till 26.02.2021
MANAGERIAL REMUNERATION & PARTICULARS OF EMPLOYEES
The information required under Section 197 of the Act read with rule 5(1) of theCompanies Appointment and Remuneration of managerial Personnel) Rules 2014 are givenbelow:
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial Year:
|Executive Directors ||Ratio to median remuneration |
|Shri Devinder Kumar Jain ||44:1 |
|Shri Narinder Kumar Jain ||44:1 |
|Mr. Arun Jain ||34:1 |
|Mr. Manish Jain ||34:1 |
|Mr. Pankaj Jain ||34:1 |
|Mr. Neeraj Jain ||34:1 |
|Non Executive Directors ||Ratio to median remuneration |
|Shri Mahavir Prasad Gupta ||Not Applicable |
|Shri Mohan Lal Mangla ||(Independent Directors are paid only sitting fees |
|Shri Sunil Jain ||and reimbursement of expenses if any |
|Shri Vijender Kumar Jain ||for attending Board Meetings. No other |
|Ms. Nisha Paul ||Remuneration has been paid to the |
|Shri Vijay Kumar Sood ||Independent Directors) |
b. The percentage increase in Remuneration of each Director Chief Executive OfficerChief Financial Officer Company Secretary in the financial year:
|Directors Chief Executive ||% increase in Remuneration in the financial year |
|Officers Chief Financial Officer || |
|and Company Secretary || |
|Executive Directors :- || |
|Shri Devinder Kumar Jain ||13.56 |
|Shri Narinder Kumar Jain ||13.56 |
|Mr.Arun Jain ||13.04 |
|Mr. Manish Jain ||13.04 |
|Mr. Pankaj Jain ||13.04 |
|Mr. Neeraj Jain ||13.04 |
|Independent Directors || |
|Shri Mahavir Prasad Gupta ||NotApplicable (Independent Directors are paid only sitting |
|Shri Mohan Lal Mangla ||fees and reimbursement of expenses if any for attending |
|Shri Sunil Jain ||Board Meetings. No other Remuneration has been paid to |
|Shri Vijay Kumar Sood ||the Independent Directors).Details of Sitting fees paid/ |
|Shri Vijender Kumar Jain ||payable incorporated in Corporate Governance report |
|Ms. Nisha Paul || |
|Ms. Sudha Singh ||27.27 |
c. The percentage increase in the median remuneration of employees in the FinancialYear: 5.56%
d. The number of permanent employees on the rolls of the Company: 419
e. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the Managerial remuneration:- Averagepercentile increase made in the employees remuneration other than Managerial Personnel inthe last FY 2019-20 was approximately 3% -27% compare to the percentile increase of 13.04%to 13.56% in the remuneration of Managerial Personnel.
Remuneration of Managerial Personnel was as per the Remuneration Policy of the Companyand as approved by the members in theAnnual General Meetings as per statutoryrequirements.
f. Affirmation that the remuneration is as per the remuneration policy of the Company:The Company affirms remuneration is as perthe remuneration policy of the Company
g. The statement containing particulars of employees as required under Section 197(12)of the Companies Act 2013 read with Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.
Top Ten Employees in terms of Remuneration Drawn
|Employess Name ||Designation ||Remune ration in Lakhs ||Nature of employment ||Qualifi cation ||Experience (in years) ||Year of commen cement of employment ||Age ||Last employ- mentof ||% of Equity Shares ||Whether employee is relative of Directoror Manger |
|Shri Devinder Kumar Jain ||Managing Director and CEO ||64.12 ||Permanent ||Graduate in B.Sc. ||59 ||1980 ||82 ||NA ||3.53 ||Relative of Shri Narinder Kumar Jain Mg. Director Mr. Arun Jain and Mr. Manish Jain WTD |
|Shri Narinder Kumar Jain ||Managing Director ||63.39 ||Permanent ||Graduate and Diploma in International Marketing ||54 ||1989 ||79 ||NA ||3.69 ||Relative of Shri Devinder Kumar Jain Mg. Director & CEO and Mr. Neeraj Jain WTD |
|Mr. Arun Jain ||Whole Time Director ||48.95 ||Permanent ||B.E. & M. Tech ||28 ||2007 ||54 ||NA ||2.03 ||Relative of. Shri Devinder Kumar Jain Mg. Director & CEO and Mr. Manish Jain WTD |
|Mr. Manish Jain ||Whole Time Director ||47.75 ||Permanent ||Qualified Engineer and MBA ||27 ||1998 ||50 ||NA ||2.20 ||Relative of. Shri Devinder Kumar Jain Mg.Director and Mr. Arun Jain WTD |
|Mr. Pankaj Jain ||Whole Time Director and CFO ||48.77 ||Permanent ||B.Com and MBA ||27 ||1998 ||49 ||NA ||5.63 ||-- |
|Mr. Neeraj Jain ||Whole Time Director ||47.76 ||Permanent ||B.E. M.Sc. and MBA ||26 ||1998 ||48 ||NA ||2.37 ||Relative of. Shri Narinder Kumar Jain Mg. Director |
|Mr. Rajesh Kumar Khurana ||Finance Mg & Head of Accounts ||13.04 ||Permanent ||B.Com (H) FCA ||38 ||1996 ||63 ||NA ||NIL ||NA |
|Ms Nikita Jain ||Markering Manager E-Commerce ||10.29 ||Permanent ||B.A. and MBA ||4 ||2016 ||25 ||NA ||NIL ||Relative of Mr. Arun Jain WTD |
|Mr. Manojit Chakraborty ||Manger (Costing) ||9.46 ||Permanent ||Cost Accountant ||22 ||2005 ||53 ||NA ||NIL ||NA |
|Mr. Gawesh Narula ||Senior Accounts Officer ||9.20 ||Permanent ||Graduate ||22 ||2005 ||50 ||NA ||Nil ||NA |
* Gratuity not included
h. Name of other employees as required under Section 197(12) of the CompaniesAct 2013read with Rule5(2)of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 and Companies (Appointment and Remuneration of Managerial Personnel) AmendmentRules 2016 of the CompaniesAct 2013 - Nil
As per SEBI Listing Regulations corporate governance report with auditors' certificatethereon and management discussion and analysis are attached which form part of thisreport.
Details of the familiarization programme of the Independent Directors are available onthe website of the Company.
(https://www.cosco.in/uploads/investors/details of familiarisation programme impartedto independent directors 1596715031.pdf)
Policy on dealing with related party transactions is available on the website of theCompany.
(URL: https://www.cosco.in/uploads/investors/related party transactions policy1566037788.pdf)
Company has declared interim Dividend for FY 2015-16 . Details of unpaid / unclaimeddividend is available on the Company's website at:
Members who have not encashed their interim dividend warrants pertaining to theaforesaid year may approach the Company/its Registrar for obtaining their unclaimeddividend.
|Year ||Dividend ||Date of Declaration ||Due DateforTransfer ||Amount |
| ||Per Share in || || ||in |
| ||Rs. || || || |
|2015-16 ||1 ||12.08.2015 ||18th September 2022 ||82781 |
VIGIL MECHANISM/WHISTLE BLOWER POLICY
To create enduring value for all stakeholders and ensure the highest level of honestyintegrity and ethical behaviour in all its operations the Company has adopted a 'WhistleBlower policy/Vigil Mechanism' which provides for adequate safeguard against victimizationof person who use such mechanism and the Directors and employees have direct access to theChairman of the Audit Committee in exceptional cases. The Vigil Mechanism (Whistle BlowerPolicy) is available on Company's website www.cosco.in
(URL: https://www.cosco.in/uploads/investors/whistle blower policy 1566037432.pdf)
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITIONAND REDRESSAL)ACT 2013
As per the requirement of The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and Rules made there under the Company has anInternal Complaints Committee (ICC) for redressal of sexual harassment complaints and forensuring time bound treatment of such complaints. There was no complaint received from anyemployee during the financial year 2019-20 and hence no complaint is outstanding as onMarch 31st 2020 for redressal.
DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of thebalance sheet.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
As required by the Companies (Matters to be included in the Report of Board ofDirectors) Rules 2014 the relevant information and data is given in Annexure-' D' annexedhereto and form part of this Report.
DEMATERIALISATION OF SHARES
The Company shares are being dealt in dematerialized form. Shareholding of thePromoters / Promoter Group has been substantially dematerialized.
Your Company is listed with Stock Exchanges at Mumbai and Delhi. Annual Listing fee forthe Financial Year 2019-20 and 2020-2021 paid to BSE Limited. No fees paid to Delhi StockExchange Limited since DSE is non functional.
Your Company has taken adequate steps to ensure that mandatory provisions of 'CorporateGovernance' as provided in the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and as per the provisions of CompaniesAct 2013 are duly complied with.
Report on 'Corporate Governance' along with 'Certificate by Practicing CompanySecretary' on compliance with the condition of Corporate Governance under SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is annexed hereto as part ofthis report as Annexures - 'E2' & E3' respectively.
Report on Management Discussion andAnalysis is annexed hereto as Annexure-'F' and formpart of this report. INDUSTRIAL RELATIONS
The industrial relations remained cordial during the year. The Company lays emphasis onall round development of its human resource.
The Directors acknowledge with thanks the continuous support and co-operation receivedfrom Bankers Statutory and Internal Auditors Customers Suppliers Dealers GovernmentAuthorities and Regulators and all other business associates and for their confidence inits management. The Board of Directors also wish to convey their appreciation to all theemployees for their sincere and dedicated services and unstinting efforts at all levels.The Management also place on record their appreciation for the confidence reposed by theStakeholders.
The Directors regret the loss of life due to COVID-19 pandemic and are deeply gratefuland have immense respect for every person who risked their life and safety to fight thispandemic.
The Directors appreciate and value the contributions made by every memberof the Cosco(India) Limited.
Byorderofthe Board of Directors
| ||(Devinder Kumar Jain) ||(NarinderKumarJain) |
| ||Managing Directorand CEO ||Managing Director |
| ||DIN:00191539 ||DIN :00195619 |
|Registered Office: || || |
|2/8 Roop Nagar || || |
|Delhi - 110007 || || |
|Dated: 1st September 2020 || || |