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Deepti Alloy Steel Ltd.

BSE: 539455 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE360S01012
BSE 00:00 | 17 Jul 26.80 0.35
(1.32%)
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NSE 05:30 | 01 Jan Deepti Alloy Steel Ltd
OPEN 26.80
PREVIOUS CLOSE 26.45
VOLUME 4085
52-Week high 28.25
52-Week low 18.25
P/E 382.86
Mkt Cap.(Rs cr) 10
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 26.80
CLOSE 26.45
VOLUME 4085
52-Week high 28.25
52-Week low 18.25
P/E 382.86
Mkt Cap.(Rs cr) 10
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Deepti Alloy Steel Ltd. (DEEPTIALLOY) - Director Report

Company director report

To

The Shareholders

The Directors have the pleasure of presenting the 25th Annual Report of yourCompany with the Audited Financial Statements of the Company for the year ended 31stMarch 2017.

Financial Results

(Rs. In Lakhs)

Particulars

Standalone

Consolidated

2016-17 2015-16 2016-17 2015-16
Revenue from Operations 286.99 42.02 465.99 3323.60
Other Income 30.17 2.26 30.00 64.08
Total Revenue 317.16 44.28 495.99 3387.68
Less: Total Expenses 292.32 44.09 487.61 3355.89
Operating Profits before Exception item Depreciation Interest and Tax 24.84 0.19 8.38 31.79
Less: Depreciation - 3.94 0.74 4.33
Interest 0.01 0.27 0.02 0.29
Profit / (Loss) Before Tax 24.83 (8.24) 7.62 27.40
Less : Exceptional Items

-

-

-

4.45
Less: Current Tax 1.67 - 1.68 9.68
Less : Deferred Tax - - - 0.10
Profit / (Loss) after Tax 23.16 (8.24) 5.94 13.18

Review of Business Operation

On standalone basis revenue from operations for FY 2016-17 was Rs. 286.99 Lakhscompared to the Revenue from operations of Rs. 42.02 Lakhs of previous year which showsuptrend about 7 times over the previous year. The Company has incurred Profit before taxfor the financial year 2016-17 of Rs. 24.83 Lakhs as against loss before tax of Rs. (8.24)Lakhs of previous year Profit after Tax for the financial year 2016-17 of Rs. 23.16 Lakhsas against Net Loss after tax of Rs. 8.24 Lakhs of Previous year.

On consolidated basis revenue from operations for FY 2016-17 was Rs. 465.99 Lakhs. TheProfit before tax of the Company for the financial year 2016-17 stood at Rs. 7.62 Lakhsmaking Net Profit after Tax for the financial year 2016-17 of Rs. 5.94 Lakhs.

Registered office of the Company

During the year the Company has changed its Registered office from 317Village-Kharval Taluko-Dharampur Dist. Valsad to 308 Shital Varsha Arcade HotelClassic Gold Road Opp. Girish Cold Drinks C. G. Road Ahmedabad - 380 009 i.e. outsidethe local limits of city town or village but within the same state i.e. within the Stateof Gujarat.

Dividend

To conserve resources for future prospect and growth of the Company your Directorsregret to declare Dividend for the Financial Year 2016-17 (Previous year - Nil).

Net Profit Transfer to Reserve

The Company has not transferred any amount to any reserves of the Company and carrystandalone loss / consolidated profit to the result and surplus account.

Performance of Subsidiary Companies:

Due to acquisition of 100% of M/s. Shankheshwer Infraproject Private Limited it becamewholly-owned subsidiary of the Company. During the Financial Year 2016-17 it has earned atotal revenue of Rs. 465.99 Lakhs in comparison of Rs. 3387.68 for the Financial Year2015-16 moving downward by 7 times.

Information of Board of Directors and Its Meetings:

a. Composition and Category of Directors on date of this report is:

Name of Directors Category of Directorship No.of other Directorship* No. of Committee Membership / Chairmanship in other Companies No. of Board Meetings attended during 2016-17 Attendance at the AGM held on August 10 2016
Mr. Parikshit Mahatama# Whole-time Director (Professional) 19 1 N. A.
Mrs. Sangitaben Jain# Non-Executive Director (Professional) 4 M - 6 1 N.A.
Mr. Rakesh Ajmera Independent Director (Professional) 3 C - 2 10 Yes
Mr. Narayansinh Chauhan Independent Director (Professional) 2 M - 3 C - 3 1 N.A.
Mr. Gautam Chauhan@ Non-Executive Director (Professional) 2 M-2 N.A.
Ms. Vaishali Trivedi@ Non-Executive Director (Professional) N.A.

* Excluding Directorship held in the Company.

# Mr. Parikshit Mahatma and Ms. Sangitaben Jain resigned from the Board w.e.f. 10thAugust 2017.

@ Mr. Gautam Chauhan and Ms.Vaishali Trivedi Appointed as additional Directors w.e.f 13thAugust 2017

The Board of Directors of the Company consists of four (4) Directors as on March 312017 two (2) are NonExecutive Director and two (2) are Non-Executive IndependentDirectors. All the Directors of the Company are Professional Directors. Further Mrs.Vaishali Trivedi a Non-Executive Director of the Company is designated as Woman Directorfor the Company in terms of second proviso to the Section 149 (1) of the Companies Act2013. The Composition of Board fulfils the regulatory requirements.

Board Meetings

Regular meetings of the Board are held at least once in a quarter. Additional Boardmeetings are convened to discuss and decide on various business policies strategies andother businesses.

During the year under review Board of Directors of the Company met May 16 2016 May31 2016 July 09 2016 August 13 2016 November 14 2016 and February 13 2017. Thegap between two consecutive meetings was not more than one hundred and twenty days asprovided in section 173 of the Act.

The Independent Directors of the Company has met one time on March 30 2016 interalia to evaluate the performance of Non-Independent Directors Board as a whole andperformance of Chairman of the Company.

Information of Committee and Its Meetings

Your Company has formed following Committees of the Board in accordance with CompaniesAct 2013:

a. Audit Committee

Meetings Composition and Attendance:

The Audit Committee met five times during the financial year 2016-17 on May 31 2016August 13 2016 November 14 2016 and February 13 2017.

The Audit Committee comprises of three Directors and two of them are IndependentDirectors. The composition of the Audit Committee as on March 31 2017 and details of theattendance of the members of the committee at the meetings of the Committee are as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Rakesh Ajmera Independent Director Chairman 5
Mr. Narayansinh Chauhan Independent Director Member N. A.
Mr. Parikshit Mahatma# Whole-time Director Member N. A.
Mr. Gautam Chauhan* Non executive Director Member

# upto 10th August 2016.

* w.e.f. 13th August 2016.

The Statutory Auditors of the Company are invited in the meeting of the Committeewherever required. Company Secretary of the Company is acting as a secretary to theCommittee.

b. Stakeholders' Grievances and Relationship Committee

Composition

The Stakeholder's Grievances & Relationship Committee comprises of three members ason March 31 2016. Mr. Rakesh Ajmera as the Chairman of the Committee Mr. NarayansinhChauhan and Mr. Gautam Chauhan as members. Company Secretary of the Company is acting as asecretary to the Committee.

Meeting(s) and attendance

During the year under review four meetings were held on May 31 2016 August 13 2016November 14 2016 and February 13 2017. Details of attendance of each member of theCommittee are as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Rakesh Ajmera Independent Director Chairman 5
Mr. Narayansinh Chauhan Independent Director Member N. A.
Mr. Parikshit Mahatama# Whole-time Director Member N. A.
Mr. Gautam Chauhan* Non executive Director Member

# upto 10th August 2016.

* w.e.f. 13th August 2016.

Complaint

During the year the Company had not received any complaints from the Shareholders.There was no complaint pending as on March 31 2017.

c. Nomination and Remuneration Committee

Composition

The Remuneration Committee comprises of three Non-executive directors two of them areIndependent Director viz. Mr. Rakesh Ajmera - Chairman Mr. Narayansinh Chauhan and Mrs.Vaishali Trivedi as members.

Meeting and Attendance

During the period under review three Nomination and Remuneration Committee meetingswere held respectively on May 31 2016 August 13 2016 November 14 2016 and February13 2017. Details of attendance of each member of the Committee are as under:

Name of the Director Category Designation No. of Meetings Attended
Mr. Rakesh Ajmera Independent Director Chairman 5
Mr. Narayansinh Chauhan Independent Director Member N. A.
Ms. Sangitaben lain# Director Member N. A.
Ms. Vaishali Trivedi * Non executive Director Member

# upto 10th August 2016.

* w.e.f. 13th August 2016.

Appointment Re-appointment and Resignation of Directors

During the year in terms of Section 149 & 152 of the Companies Act 2013 theBoard of Directors in their Meeting held on 13th August 2016 has appointed Mr.Gautam Chauhan and Ms. Vaishali Trivedi a NonExecutive Directors. Further pursuant toprovisions of Section 161 of the Companies Act 2013 Mr. Gautam Chauhan and Ms. VaishaliTrivedi holds office up to the date of ensuing Annual General Meeting of the Company. TheBoard of Directors of the Company recommended their Appointment on the Board of theCompany and resolution to that effect has been proposed in the Notice convening the 25thAnnual General Meeting of Members of the Company.

Mr. Parikshit Mahatma Whole-time Director and Ms. Sangitaben Jain Directors of theCompany had resigned from the Board of the Company w.e.f. 10th August 2016.The Board places on record their appreciations for their efforts in the success of theCompany.

None of the Directors of the Company is disqualified for being appointed as Director asspecified in Section 164 (2) of the Companies Act 2013.

Details of the Directors seeking Appointment in this Annual General Meeting is providedelsewhere in the 24th Annual Report:

Declaration by Independent Directors

The Company has received necessary declaration from each Independent Director underSection 149(7) of the Companies Act 2013 to the effect that they meet the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013. The Terms andConditions for Appointment of Independent Directors and Code for Appointment ofIndependent Directors are incorporated on the website of the Company atwww.deeptialloysteel.com.

Details of Key Managerial Personnel

Further Ms. Riddhi N. Shah is acting as a Company Secretary of the Company . Mr.Darshil Hinrandani has tendered the resignation from the post of CFO w.e.f November 142016.

Nomination and Remuneration Policy

In terms of the provisions of the Companies Act 2013 the Company has devised a policyon Nomination and Remuneration of Directors Key Managerial Personnel and SeniorManagement and the said policy has been incorporated on the website of the Company i.e.www.deeptialloysteel.com.

Policy on Appointment of Directors Key Managerial Personnel and Senior ManagementPersonnel:

The policy is formulated to identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director KMP and SeniorManagement personnel and recommend to the Board for his / her appointment.

Policy on remuneration of Director KMP and Senior Management Personnel:

The Company follows mixed of fixed pay benefits and performance based variable pay.The Company pays remuneration by way of salary. The remuneration paid by the Company iswithin the salary scale approved by the Board and Shareholders.

Board Evaluation

The board of directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act.

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. Inaddition the chairman was also evaluated on the key aspects of his role.

Separate meeting of independent directors was held to evaluate the performance ofnon-independent directors performance of the board as a whole and performance of thechairman taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent directors at which the performance of the board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.

The Board of Directors expressed their satisfaction with the evaluation process.

Public Deposit

The company has not accepted any deposits from the public. Hence the directives issuedby the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act2013 or any other relevant provisions of the Act and the Rules there under are notapplicable.

Particulars of Loans Guarantees Investments & Security

Details of Loans Guarantees Investments and Security covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statement.Further Company has given loan to its wholly owned subsidiary which does not come underthe preview of Section 186(3).

Contracts or Arrangements with Related Parties

All transactions to be entered by the Company with related parties will be in theordinary course of business and on an arm's length basis. However the Company has notentered into any related party transaction as provided in Section 188 of the CompaniesAct 2013 with the related party. Hence Disclosure as required under Section 188 of theCompanies Act 2013 is not applicable to the Company.

Extract of Annual Return

Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of Companies (Management and Administration) Rules2014 the extract of the Annual Return as at March 31 2017 in Form MGT-9 forms part ofthis Annual Report as "Annexure - B".

Particular of Employees

The Company has not paid any remuneration to any Director of the Company. Hencedetails in terms of subsection 12 of Section 197 of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are not applicable to the Company.

The details as required under section 197(12) of the Companies Act 2013 read withRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) 2014 isnot applicable as there is no such employee in the Company employed throughout thefinancial year with salary above Rs. 1.02 Lakhs p.a. or employed part of the financialyear with average salary above Rs. 8.5 Lakhs per month.

Further there is no employee employed throughout Financial year or part thereof wasin receipt of remuneration of in aggregate is in excess of that drawn by the ManagingDirector or Whole time Director or Manager and holds by himself or along with his spouseand dependent children not less than Two percent (2%) of the Equity Shares of theCompany.

Energy Conservation Technology Absorption and Foreign Exchange Earnings and Outgo

The details of conservation of energy technology absorption etc. as required to begiven under section 134(3)(m) of the Companies Act 2013 read with the Companies (Accounts)Rules 2014 is not given as the Company has not taken any major step to conserve theenergy etc.

Further there was no foreign exchange earnings and outgo during the financial year2016-17 (Previous Year - Nil).

Material Changes and commitment affecting financial position of the Company

There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of financial year of the Company i.e. March 312017 and the date of Director's Report i.e. 4th September 2017.

Sexual Harassment of women at workplace

There were no incidences of sexual harassment reported during the year under review interms of the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and there are only 2 Women employees (Both areholding the position in the Top Management Level) and therefore there was no need toconstitute an Internal Complaints Committee (ICC).

Corporate Governance

Your Company strives to incorporate the appropriate standards for corporate governance.However pursuant to Regulation 15(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company is not required to mandatorily comply with theprovisions of certain regulations of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and therefore the Company has not provided a separatereport on Corporate Governance although few of the information are provided in thisreport of Directors under relevant heading.

Management Discussion and Analysis

Management Discussion and Analysis for the year under review as stipulated underRegulations 34 (2)(e) of the SEBI (LODR) 2015 is presented in a separate section formingpart of this Annual Report.

Auditors

Statutory Auditor & their report

M/s. M/s. Marmik G Shah & Associates Chartered Accountant Ahmedabad (FRN135024W) who were appointed as the statutory auditors of the Company for a period of fiveyears from the conclusion of 24th AGM till conclusion of the 29thAGM to be held in the year 2020 has shown their unwillingness and tendered theirresignation as Statutory Auditors of the Company.

To fill up the Casual Vacancy raised due to resignation of M/s. Marmik G Shah &Associates the Board of Directors have appointed M/s. S. Mandawat & Co. as theStatutory Auditors of the Company for the F.Y. 201516 in their meeting held on September14 2016. Further the Board of Directors recommends appointment of M/s. S. Mandawat &Co. from the members as provided under Section 139of the Companies Act 2013.

The Auditors' Report on the accounts of the Company for the accounting year ended March31 2017contains the following qualifications:

As informed by management the account with HDFC bank has been ceased by thecommercial tax department and therefore account statement of the same has not beenavailable to us for verification. As a result of these matters we wereunable to determine whether any adjustments might have been found necessary in respect ofrecorded or unrecorded transactions and accounts receivable/payable in the Balance Sheetand the corresponding elements making up the Statement of Profit and Loss and Cash Flowstatement.

The management replies for the Audit Qualifications are as under:

Company is in process of procuring the necessary documents.

As per the Section 139(1) of the Companies Act 2013 M/s. S. Mandawat & CoChartered Accountants Ahmedabad are recommended to be appointed as the auditors of theCompany to hold office for a period of five years from the conclusion of this 25thAGM till conclusion of the 30th AGM to be held in the year 2021.

Secretarial Auditor & their report

Pursuant to the provisions of section 204 of the Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed Mr. Parth PShah Practicing Company Secretary Ahmedabad to carry out the Secretarial Audit for thefinancial year ended on March 31 2017. Secretarial Audit Report is attached to thisreport as "Annexure - C".

The Secretarial Auditors' Report of the Company for the Financial Year ended March 312017 contains the following qualifications:

During the period under review the Company has generally complied with the provisionsof the Act Rules and regulations mentioned above except as below point wise

• As per the information provided by the Company the Company is in the process ofAppointing Managing Director / Whole-time Director and Chief Financial Officer in theCompany as per Section 203 of the Companies Act 2013 and Rules made thereunder. Thoughduring the period under reviewed the Company has not appointed the above Key ManagerialPersonnel;

• Non-Compliance of Regulation 30(12) of SEBI ( Listing Obligations andDisclosures Requirements) Regulations 2015 for Intimating Stock Exchange regarding DateDay and time of Annual General Meeting and closure of Register of Members and Sharetransfer books for the purpose of Annual General Meeting

The management replies for the Audit Qualifications are as under:

The Company is in process of Complying above Compliances and will be now upto dateCompliant Company with next Financial Year.

Directors' Responsibility Statement

In terms of section 134(5) of the Act your Directors state that:

i.) in the preparation of the annual financial statements for the year ended on March31 2016 applicable accounting standards read with requirements set out under scheduleIII of the Act have been followed along with proper explanation relating to materialdepartures if any

ii.) such accounting policies have been selected and applied consistently and judgmentsand estimates made that are reasonable and prudent so as to give a true and fair view ofthe state of affairs of the company as at March 31 2017and of the profit of the companyfor the year ended on that date

iii.) proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of thecompany and for prevention and detection of fraud and other irregularities

iv.) the annual financial statements are prepared on a going concern basis

v.) proper internal financial controls are in place and that the financial controls areadequate and are operating effectively and

vi.) the systems to ensure compliance with the provisions of all applicable laws are inplace and are adequate and operating effectively.

General Disclosure

Your Directors state that the Company has made disclosures in this report for the itemsprescribed in section 134(3) of the Act and Rule 8 of The Companies (Accounts) Rules 2014to the extent the transactions took place on those items during the year.

Your Directors further state that no disclosure or reporting is required in respect ofthe following items as there were no transactions on these items during the year underreview:

1. Details of Annual Report on Corporate Social Responsibility as Company is notfalling within the criteria as prescribed u/s 135 of the Companies Act 2013

2. Issue of Equity Shares with differential rights as to dividend voting or otherwise.

3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and ESOS.

4. Details of Contracts and arrangement with the related parties.

5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

Acknowledgement

Your Directors take this opportunity to place on record the valuable co-operation andsupport extended by the banks government business associates and the shareholders fortheir continued confidence reposed in the Company and look forward to having the samesupport in all future endeavors.

Registered Office By order of the Board
308 Shital Varsha Arcade For Deepti Alloy Steel Limited
Girish Colddrinks Cross Road
C. G. Road
Ahmedabad - 380 009 Gautam Chauhan
Place: Ahmedabad Chairman and Director
Date: 4th September 2017 DIN: 00044034