Creative Peripherals and Distribution Limited
(Earlier known as Creative Peripherals and Distribution Private Limited)
Your Directors have pleasure in presenting the Fifteenth Annual Report on business andoperations along with the Audited Financial Statements for the year ended March 31 2019.
WHO WE ARE AND WHERE WE WILL BE:
Founded in 1992 your Company was originally incorporated on September 22 2004 as aPrivate Limited Company completed its 27 years of journey. Today we are market entry andpenetration specialist in the categories of IT Imaging Lifestyle and Security Products.Information Technology lies at the core of your Company's business. The sector has stayedindomitable over the last twenty seven years since it emerged after the Governmentliberalized the Indian economy. It prompted and shaped industrial growth and transformedthe lifestyle of the average Indian by successfully changing his notion of a luxury itemto one of necessity.
The Company conducts pre-sales and marketing activities for the success of the brand aswell as to enable the channel partners to leverage their expertise and bottom line.Creative Peripherals works closely with partners across channels including Large FormatRetail (LFR) e-commerce and specialized retailers. The company is one of the few largedistributors who conduct specialized training modules events and promotional activitiesat the ground level with channel partners along with workshops and demos for resellers.This is possible due to the dedication and experience of the corporate and sales teamswhich constantly track latest market developments to build a closer market connect.
The objective of your Company is to have a sustainable development by staying connectedto its roots. Currently the Company is operating nationwide through its brancheswarehouses and service centres. Our strategy is to optimize our core technology solutionsbusiness while expanding and investing in higher margin advanced and specialty solutionsand high value services. Over last couple of years we have plugged gaps in our operatingmodel and intend to continue doing so with the objective of cement out reputation as aone-stop shop. CPDL is a broad based distribution model which is based on multipleproducts and multiple brand strategy. The focus is to capture a considerable market sharein each of the product categories that will help in its offerings to channel partners andalso spread its market risks arising out of fluctuations in the market share of variousbrands besides helping it to achieve economies of scale.
Our vision is to become world class distributor and the Board is of firm belief thatour value added approach with vendors resellers and industry at large shall enable yourCompany to meet its goal.
Your Company subsequently converted into a Public Limited Company in January 31 2017.Later In the beginning of this year on April 11 2017 Company has introduced Book BuildIssue IPO in NSE SME Exchange with issue size of 1800000 Equity shares of Rs. 10 eachwith aggregating up to Rs. 135000000/- with issue price of Rs. 75 per share with marketlot of 1600 shares in one lot.
Further Company is in process of increase in Authorised Share Capital issuance ofBonus Shares at 1:1 ratio and migration from NSE SME Exchange to NSE Main Board - CapitalMarket as discussed and approved by Company's Board Meeting held on 07th May 2019.However this Annual report is pertaining to financial year ending at 31st March 2019effect of the same will not appear in this report.
The highlights of the Financial Results are:
| || ||(Amount in Rs.) |
|Particulars || |
March 31 2019
March 31 2018
|Revenue from Operations and Other Income ||3707055649 ||2509584028 |
|Less: Expenses ||3626249393 ||2466148786 |
|Profit Before Tax ||80806256 ||43435242 |
|Less: Exceptional Items ||NIL ||NIL |
|Less: Extraordinary Items ||NIL ||NIL |
|Less: Tax Expenses ||23349909 ||14558465 |
|Profit after Tax ||57456347 ||28876777 |
|Balance brought forward ||104479432 ||75602655 |
|Amount available for Appropriation ||161935779 ||104479432 |
|Add: Share Premium Account ||117000000 ||117000000 |
|Less: Income Tax for earlier periods ||-915029 ||0 |
|Less: Dividend Paid ||-900320 ||0 |
|Less: Dividend Distribution Tax Paid ||-185106 || |
|Balance carried to Balance Sheet ||276935324 ||221479432 |
|Earnings per Share (Basic) ||9.91 ||5.02 |
|Earnings per Share (Diluted) ||9.91 ||5.02 |
The year gone by has been really profitable. The Company's revenue increased toRs.37070.55 Lakhs as compared to Rs.25095.84 Lakhs in the previous year marking anincrease by Rs.11974.71 Lakhs.
The Company's Net Profit after Tax stood at Rs.574.56 Lakhs as compared to Rs.288.76Lakhs in the previous year registering an increase of by Rs. 285.80 Lakhs.
Board of Directors of the Company had proposed 5% Final Dividend on the face value pershare for the financial year ending at 31st March 2018 in the Board Meeting held on 21stMay 2018 and the same was approved by members of the Company in Annual General Meetingheld on 27th September 2018.
Further considering financial growth and future prospects of your Company Board ofDirectors in their Board Meeting held on 27th May 2019 has again recommended a FinalDividend of 5% on face value per share for the financial year ending at 31st March 2019subject to approval of shareholders in Annual general meeting to be held for FinancialYear 2018-19.
Further with also keeping in mind for plough back of profit your promoter directorsholding 68.95% of overall paid up equity share capital of the Company have opted out fromtheir rights to have dividend. So the above said dividend will be provided to PublicShareholders who hold 31.05% of total paid up equity share capital.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend which were unclaimed or unpaid since last seven years.
TRANSFER TO RESERVES
The whole profit after tax has been transferred to Surplus in the Statement of Profit& Loss.
At the beginning of the year the Authorised Share Capital of the Company Rs.80000000 divided into 8000000 Equity Shares of Rs. 10/- which remained samethroughout the year.
At the beginning of the year the Issued Subscribed and Paid Up Share Capital of theCompany Rs. 58000000 divided into 5800000 Equity Shares of Rs. 10/- which remainedsame throughout the year.
The Company has entered into an agreement with the National Securities DepositoryLimited (NSDL) as well as the Central Depository Services (India) Limited (CDSL) to enableshareholders to hold shares in dematerialized form. The Company also offers simultaneousdematerialisation of the physical shares lodged for transfer.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board consists of Executive and Non-executive Directors including IndependentDirectors along with Key Managerial Personnel who have vast experience in the corebusiness activity of the Company. The composition of the Board is in consonance withCorporate Governance norm specified in the SEBI Regulations with the Stock Exchange.
During the year under review there was no change in Directors and Key ManagerialPersonnel (KMP).
Remuneration paid to Executive Directors Independent Directors & KMPs arementioned in Corporate Governance Report annexed with this Directors' Report.
During the year Five Meetings of Board of Directors were convened and held and detailsof which are given in the Corporate Governance Report. The intervening gap between theMeetings was within the period prescribed under the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in accordancewith the provisions of Section 134 (3) (c) and 134(5) of the Companies Act 2013:
1. That in preparation of the Annual Accounts for the year ended March 31 2019 theapplicable accounting standards had been followed along with proper explanation relatingto material departures if any;
2. That the directors had selected such accounting policies and applied consistentlyand made judgments and estimates that were reasonable and prudent so as to give true andfair view of the state of affairs of the Company at the end of the financial year endedMarch 31 2019 and the profits of the Company for the year under review;
3. That proper and sufficient care has been taken for the maintenance of adequateaccounting records for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
4. That the annual accounts for the year ended March 31 2019 have been prepared on a'going concern basis.'
5. That proper internal financial controls were in place and that such internalfinancial controls are adequate and were operating effectively.
6. That proper systems to ensure compliance with the provisions of all applicable lawswere in place and that such systems were adequate and operating effectively.
M/s. S. K. Thanawala & Co. Chartered Accountants Mumbai having ICAI FirmRegistration No. 110951W have been appointed for period of 5 years commencing from 1stApril 2015 to 31st March 2020 within the purview of Sections 139 and 142 of theCompanies Act 2013 subject to ratification by the members in the each Annual GeneralMeeting during this period. However since company is in process of migration from NSE SMEExchange to NSE Main Board which would require to devote more time and involvement withcompany in dealing with additional compliances/ laws/ operations relating to Main BoardCompanies. Also the existing auditor is more than 70 years of age reducing his businessand working hours he has express his inability to devote the adequate time required.
Taking this in consideration Board of Directors have considered and recommendedappointment of M/s. Gupta Raj & Co. Chartered Accountants Mumbai having ICAI FirmRegistration No. 001687N as Statutory Auditor of the Company for the term of 5 years. Abrief profile of M/s. Gupta Raj & Co. have been attached with Notice of AnnualGeneral Meeting.
The Auditors' Report on the financial statements of the Company for the year endingMarch 31 2019 is unmodified i.e. it does not contain any qualification reservation oradverse remark. The Auditors' Report is enclosed with the financial statements formingpart of the Annual Report.
INTERNAL AUDIT AND INTERNAL FINANCIAL CONTROLS
The Company has in place well defined and adequate internal controls commensurate withthe size of the Company and the same were operating effectively throughout the year. TheCompany has an Internal Control System commensurate with the size scale and complexityof its operations. Apart from in-house Internal Audit function to strengthen and maintaintransparency the Company has also appointed M/s Somaiya & Co. Chartered AccountantsMumbai as Internal Auditors of the Company in accordance with Section 138 of theCompanies Act 2013 to examine the effectiveness of internal control system.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 and SEBI Listing Regulations2015. Further The Independent Directors are not liable to retire by rotation.
CORPORATE SOCIAL RESPONSIBILITY
Till last year the Company did not fall under any applicability of the said provisionsas per the Companies Act 2013 and has not developed and implemented any Corporate SocialResponsibility initiatives.
However from this year as Company has crossed its Net Profit above Rs. 5 crores forfinancial year ending at 31st March 2019 the provisions of the CSR will be applicablenow onwards and Company has set up Corporate Social Responsibility Committee and willdevelop and implement its initiatives from current year onwards.
During the year Four Meetings of Audit Committee were convened and held and details ofwhich are given in the Corporate Governance Report. Your Directors ensures that AuditCommittee meets regularly to review reports including significant audit observations andfollow-up actions thereon. The Audit Committee also meets the Company's Statutory Auditorsto ascertain their views on financial statements including the financial reportingsystem related parties transactions compliance to accounting policies and procedures.
NOMINATION AND REMUNERATION COMMITTEE
During the year One Meeting of Nomination and Remuneration Committee was convened andheld and details of which are given in the Corporate Governance Report. Your Directorsensures that the Company follows a Policy on Remuneration of Directors and SeniorManagement Employees. The policy shall be approved by the Nomination & RemunerationCommittee and the Board. The main objective of the said policy is to ensure that the leveland composition of remuneration is reasonable and sufficient to attract retain andmotivate the Directors KMP and Senior Management employees.
The policy of the Company on Director's appointment and remuneration is uploaded on tothe Company's website and the same is available at http://ecreativeindia.com/ at thefollowing path:https://ecreativeindia.com/wp-content/uploads/2017/08/Nomination-and-Remuneration-Policy.pdf
STAKEHOLDERS' RELATIONSHIP COMMITTEE
During the year One Meeting of Stakeholders' Relationship Committee was convened andheld and details of which are given in the Corporate Governance Report. The role of theCommittee is explained in detail in the Corporate Governance Report enclosed herewith.During the year under review Company has complied with all compliances as mandated byvarious government authorities and Company has not received any complaint from itsInvestor or shareholders or any individuals.
INSURANCE & RISK MANAGEMENT COMMITTEE
During the year Four Meeting of Risk Management Committee were convened and held anddetails of which are given in the Corporate Governance Report. You Director ensures thatthe assets of the Company are adequately insured against the loss due to fire theftriot earthquake terrorism in transit etc. and such other risks which are considerednecessary by the management. Further the Company identifies and assess key risks andformulate strategies for mitigation of such risks that are identified by the Company.
The policy of the Company on Risk Assessment & Management is uploaded on to theCompany's website and the same is available at http://ecreativeindia.com/ at the followingpath:https://ecreativeindia.com/wp-con-tent/uploads/2017/08/Risk-Assessment-Management-Policy.pdf
PREVENTION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE
During the year Four Meeting of Internal Compliant Committee (under Sexual HarassmentPolicy) were convened and held and details of which are given in the Corporate GovernanceReport. The Company has a Policy on "Prevention of Sexual Harassment of Women at WorkPlace" and matters connected therewith or incidental thereto covering all the aspectsas contained under the 'The Sexual Harassment of Women at Work Place (ProhibitionPrevention and Redressal) Act 2013'. Your Directors state that during the year underreview no cases were filed pursuant to the Sexual Harassment of Women at Work Place(Prevention Prohibition and Redressal) Act 2013.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy establishing vigil mechanism toprovide a formal mechanism to the Directors and employees to report their concerns aboutunethical behaviour actual or suspected fraud or violation of the Company's Code ofConduct or other policies. The policy provides for adequate safeguards againstvictimization of employees who avail of mechanism and also provides for direct access tothe Chairman of the Audit Committee. It is affirmed that no personnel of the Company hasbeen denied access to the Audit Committee. The policy of vigil mechanism is available onthe Company's website.
The policy of the Company on Vigil Mechanism / Whistle Blower is uploaded on to theCompany's website and the same is available at http://ecreativeindia.com/ at the followingpath: http://ecreativeindia.com/wp-content/uploads/2017/08/Whistle-Blower-Policy.pdf
The familiarization programme aims to provide Independent Directors with the industryscenario the socio-economic environment in which the Company operates the businessmodel the operational and financial performance of the Company significant developmentsso as to enable them to take well informed decisions in a timely manner. This programmealso seeks to update the Directors on the roles responsibilities rights and duties undervarious Acts and other statutes.
CRITERIA OF MAKING PAYMENTS TO NON-EXECUTIVE DIRECTORS
The policy of the Company on Criteria of making payments to Non-executive Directors isuploaded on to the Company's website and the same is available athttp://ecreativeindia.com/ at the following path:https://ecreativeindia.com/wp-content/uploads/2019/07/Criteria-for-making-payments-to-Non-Executive-Directors.pdf
In compliance with the provisions of Section 134(3)(p) of the Act read with Rule 8(4)of the Companies (Accounts)Rules 2014 the Board carried out annual evaluation of its ownperformance that of its Committees and individual directors.
The performance of the Board and its committees and individual directors were evaluatedby the Board after seeking inputs from all the Directors on the basis of criteria such ascomposition and structure of the Board quality of deliberations effectiveness of theprocedures adopted by the Board participation of the Board and committee meetings andgovernance reviews etc.
As per Schedule IV to the Companies Act 2013 a separate meeting of IndependentDirectors was held on March 31 2019 where Independent Directors reviewed theperformance of Non-Independent Directors the Board as a whole and the Chairman of theCompany.
Your Company has not accepted any deposit and as such no amount of principal andinterest were outstanding as at the Balance Sheet date.
A. Employee Relations
We believe that success of Company depends on the talent and dedication of ouremployees and we strive to attract hire develop and retain outstanding employees. Inview of this we have laid down a comprehensive set of policies aiming at attractingretaining and motivating employees. We believe significant benefits are realized fromhaving a strong and seasoned management team with many years of experience in technologydistribution and related industries. We consider relations with our employees to be good.
B. Trade Relations
The Company maintained healthy cordial and harmonious industrial relations at alllevels. Despite severe competition the enthusiasm and unstinting efforts of the employeeshave enabled the Company to remain at the forefront of the Industry.
This accord incorporates novel elements such as introducing wide range of productsnurturing healthy competition giving pocket friendly credit cycles timely clearance ofdues easy accessibility to product heads etc. Your Company will continue in itsendeavour to build and nurture strong links with trade allies based on mutuality respectand co-operation with each other and with consistent consumer interest.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information pertaining to conservation of energy technology absorption foreignexchange earnings and outgo as required under the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 is given hereunder:
A. Conservation of energy
Your Company is primarily engaged in Marketing and Trading activities and has notconsumed energy of any significant level and hence no additional investment is required tobe made forreduction of energy consumption. However the Company will continue with itsefforts to conserve the energy.
B. Technology absorption
The Company's operations do not require significant absorption of technology.
C. Foreign Exchange Earnings and Outgo
|Particulars ||Current Year (in Rs.) ||Previous Year (in Rs.) |
|Foreign Exchange Earnings ||796048226 ||403937020 |
|Foreign Exchange Outgo ||1988426930 ||1086847751 |
EXTRACT OF THE ANNUAL RETURN
In accordance with Section 134 (3) (a) and as provided under subsection (3) of Section92 of the Companies Act 2013 an extract of the Annual Return in prescribed form MGT - 9is appended as Annexure - A to the Board's Report.
RELATED PARTY TRANSACTIONS
During the year Company has made several related party transactions which were in theordinary course of business and on an "arm's length" basis. The particulars ofcontracts or arrangements entered into by the Company with related parties as referred insub-section (1) of section 188 of the Companies Act 2013 in prescribed Form No. AOC-2is appended as Annexure - B to the Board's Report.
MANAGEMENT DISCUSSION AND ANALYSIS
A Management Discussion and Analysis as required under the Regulation 34(2)(e) of SEBI(Listing Obligations and Disclosure Requirements) Regulation is annexed herewith as Annexure- C and forms part of the Boards' Report.
The Board of Directors have appointed M/s. Satyajit Mishra & Co. PractisingCompany Secretary Mumbai to conduct Secretarial Audit for the financial year 2018-19under Section 204 of the Companies Act 2013 as part of good corporate governance andtransparency. The Secretarial Audit Report in form MR-3 for the financial year 2018-19forms part of the Directors' Report as Annexure - D. Further theSecretarial Audit Report doesn't contain any adverse remark or comments.
The Company has complied with the corporate governance requirements as stipulated underthe Listing Regulations. A separate section on corporate governance along with acertificate from the Secretarial Auditor confirming the compliance is annexed as Annexure-E and forms part of this Annual Report.
LOANS GUARANTEES & INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
MATERIAL CHANGES AND COMMITMENTS
No material changes have took Place affecting the financial position of the Companyfrom the date of closure of financial year till the date of signing of this report.
CHANGE IN ACCOUNTING TREATMENT
There has been no change in the accounting policies during the period under review.
CHANGE IN NATURE OF BUSINESS
There has been no change in nature of business of the Company during the period underreview.
Your Directors are thankful to the Vendors Customers Bankers National StockExchange Registrar and Transfer Agent Merchant Bankers Depositories Central and Stategovernments together with their departments the local authorities for their continuedguidance support and co-operation. Your Company has been able to operate efficientlybecause of the culture of professionalism creativity integrity and continuousimprovement in all functions and areas as well as the efficient utilisation of theCompany's resources for sustainable and profitable growth. To them goes the credit for allof the Company's achievements.
And to you our Shareholders we are deeply grateful for the confidence and faith thatyou have always reposed in us.
For and on behalf of the Board of Directors Creative Peripherals and DistributionLimited
Chairman & Managing Director
Date: 14th August 2019
Creative Peripherals and Distribution Limited
Registered Office: 3rd& 4th Floor Plot No. 137AB Kandivali Co OpIndustrial Estate Limited
Charkop Kandivali West Mumbai - 400 067
Email ID: firstname.lastname@example.org