We have pleasure in presenting the 21st Annual Report together with the FinancialStatement of the Company for the year ended 31st March 2018.
|1. Fianancial Results : || || || ||(^ in lakhs) |
|Particulars || |
| || |
Accounting year ended
Accounting year ended
| ||31.03.2018 ||31.03.2017 ||31.03.2018 ||31.03.2017 |
|1 Income || || || || |
|a Revenue from Operations ||17701.63 ||18773.04 ||28708.19 ||30183.29 |
|b Other Income ||186.31 ||221.46 ||1139.57 ||788.70 |
|Total Income from Operations ||17887.94 ||18994.50 ||29847.76 ||30971.99 |
|2 Expenses || || || || |
|a Cost of Materials Consumed # ||3540.84 ||3362.50 ||3698.88 ||3513.00 |
|b Changes in Inventories offinished goods ||126.22 ||185.89 ||(69.86) ||156.31 |
|c Changes in Inventories of biological assets ||(12.62) ||(1.16) ||34.69 ||(1.04) |
|d Employee benefits expense ||6270.31 ||6270.24 ||7667.14 ||7437.36 |
|e Finance costs ||446.76 ||326.32 ||899.73 ||808.72 |
|f Depreciation and amortization expense ||743.90 ||723.58 ||1744.99 ||2088.89 |
|g Other expenses ||6111.45 ||6601.13 ||13055.79 ||13410.41 |
|Total expenses ||17226.86 ||17468.50 ||27031.36 ||27413.65 |
|3 Profit / (Loss) before tax (1-2) ||661.08 ||1526.00 ||2816.40 ||3558.34 |
|Tax expense || || || || |
|- Current Tax ||130.06 ||367.53 ||486.03 ||996.63 |
|- Deferred Tax ||(292.37) ||(22.35) ||(570.03) ||(151.17) |
|4 Tax expense (credit) ||(162.31) ||345.18 ||(84.00) ||845.46 |
|5 Profit / (Loss) for the period (3-4) ||823.39 ||1180.82 ||2900.40 ||2712.88 |
|Items that will not be reclassified to profit or loss |
Re measurement of post employment benefit obligations
|131.02 ||(115.68) ||131.02 ||(115.68) |
|Fair valuation of equity investments ||850.07 ||1156.99 ||850.07 ||1157.12 |
|Income Tax relating to these items ||(139.98) ||36.84 ||(139.98) ||36.84 |
|Items that will be reclassified to profit or loss |
Exchange differences on translation of foreign operations
| || ||(1167.09) ||(2037.57) |
|6 Other comprehensive income for the year (net of tax) ||841.11 ||1078.15 ||(325.98) ||(959.29) |
|7 Total comprehensive income for the period ||1664.50 ||2258.97 ||2574.42 ||1753.59 |
|8 Paid-up equity share capital |
(Face value Rs.10/- each)
|700.50 ||700.50 ||700.50 ||700.50 |
|9 Earningspershare(ofRs10/-each) || || || || |
|(a) Basic (Rs) ||11.75 ||16.86 ||41.40 ||38.73 |
|(b) Diluted (Rs) ||11.75 ||16.86 ||41.40 ||38.73 |
The Directors recommend a dividend of Rs. 8.00 per equity share i.e. @80% for thefinancial year ended 31st March 2018 subject to approval of the shareholders at theensuing Annual General Meeting. The dividend on equity shares if approved by the memberswould involve a cash outflow of f 675.59 lakhs including dividend tax.
3. Transfer to reserves
The directors have decided to retain the entire amount of Rs. 442.35 lakhs in theretained earnings.
The total tea manufacturing and sales in respect of the Indianoperationsfortheyearunderreview was 10.07 and 10.12 mn kg. as against 10.36 and 10.62 mnkg. respectively in the previous year. The production for the year under review wascomparatively less. The sales in terms of volume was also comparatively less. The averagerealization was comparatively less during the year under review in comparison to theprevious year.
The total tea manufacturing and sales in respect of the African operations for the yearunder review was about 8.70 and 8.52 mn kg. as against 8.70 and 8.64 mn kg. respectivelyin the previous year. The production was almost equal to the previous year but the saleswere comparatively less during the year under review. The average realization was almostequal to the previous year.
The production and sale of macadamia in terms of volume was about 0.30 and 0.28 mn. kgas against 0.26 and 0.28 mn kg respectively in the previous year. The production ofmacadamia during the year under review was comparatively more whereas the sales werealmost similar in comparison to the previous year.
5. Subsidiary Companies
The Company has following four wholly owned subsidiaries as on March 31 2018 :
i) Dhunseri Petrochem & Tea Pte Ltd (DPTPL)
ii) Makandi Tea & Coffee Estates Ltd (MTCEL)
iii) Kawalazi Estate Company Ltd (KECL)
iv) A.M. Henderson & Sons Ltd. (AMHSL)
The entire share capital of the subsidiary AMHSL is held by MTCEL and that of MTCEL andKECL are held by DPTPL and that of DPTPL is held by the Company making them 100% whollyowned subsidiaries of the Company incorporated outside India.
There has been no material change in the nature of the business of the subsidiaries.
During the year M/s. Elfin Heights Private Limited a wholly owned subsidiary wasdisposed of by the Company.
There are no associate companies within the meaning of Section 2(6) of the CompaniesAct 2013 ("Act").
Pursuant to provisions of Section 129(3) of the Act a statement in Form AOC-1containing the salient features of the financial statements of the Company's subsidiariesis attached to the financial statements of the Company. Pursuant to the provisions ofSection 136 of the Act the financial statements of the Company consolidated financialstatements along with relevant documents and separate audited accounts in respect ofsubsidiaries are available on the website of the Company.
The equity shares of the Company are listed on BSE and NSE.
7. Directors' ResponsibilityStatement
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors confirm:
(i) that in the preparation of the annual accounts the applicable accounting standardshave been followed and no material departures have been made from the same;
(ii) that they have selected such accounting policies and applied them consistently andmade judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
(iii) that they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(iv) that they have prepared the annual accounts on a 'going concern' basis.
(v) that they have laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and are operating effectively.
(vi) that they have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
The work performed by the internal auditor statutory auditor and secretarial auditorand the reviews performed by management and the audit committee the Board is of theopinion that the Company's internal financial controls were adequate and effective duringthe financial year 2017-18.
8. Directors & Key Managerial Personnel
Mr. Ashok Kumar Lohia (DIN: 00132070) resigned w.e.f. 10.8.2017.
Mr. Basudeo Beriwala (DIN: 00119319) resigned with effect from the conclusion of theboard meeting held on 21st May 2018.
Mr. Vivek Goenka (DIN: 00042285) and Prof. Ashoke Kumar Dutta (DIN: 00045170) wereappointed as Additional Directors of the Company at the Board Meetings held on 30thAugust 2017 and 21st May 2018 respectively. They shall hold office till the conclusionof the ensuing AGM of the Company. Mr.Vivek Goenka and Prof. Ashoke Kumar Dutta areproposed to be appointed as Independent Directors at the ensuing21st AGM of the Companyfor a consecutive period of five years w.e.f. 30th August 2017 and 21st May 2018respectively. Section 149(13) states that the provisions of sub-section (6) and (7) ofSection 152 of the Companies Act 2013 relating to retirement of directors by rotation isnot applicable to the independent directors.
The Company has received declarations from its Independent Directors under Section149(7) confirming that they meet the criteria of independence as provided in sub-section(6) of Section 149 of the Companies Act 2013.
Mr. Rajiv Kumar Sharma (DIN: 05197101) retires by rotation at the ensuing 21st AnnualGeneral Meeting and being eligible offers himselffor reappointment.
Mr. Vikash Jain was appointed as Chief Financial Officer of theCompanyw.e.f. 14.12.2017in placeof Mrs. Bhavana Khemka who resigned.
9. Number of Meetings of the Board
The Board met four times during the financial year 201718. The details have beenprovided in the Corporate Governance Report in terms of Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 which is annexedto this Report.
10. Board evaluation
An annual evaluation of the performances of the Board its committees and that of theindividual directors was undertaken during the year on the basis of the criteria such asthe composition structure functioning effectiveness of the Board the CommitteeMeetings the contribution and preparedness of individual directors to the board andcommittees etc after seeking inputs from all the directors.
In a separate meeting of the Independent Directors the performance of non-independentdirectors the Chairman and the Board as a whole was evaluated.
11. Policy on directors' appointment and remuneration and other details
The Company's policy on directors' appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been disclosed in the corporate governancereport.
12. Internal financial control systems and their adequacy
The details in respect of internal financial control and their adequacy are included inthe Management Discussion & Analysis which forms part of the Corporate GovernanceReport.
13. Audit committee
The details pertaining to composition of audit committee are included in the CorporateGovernance Report.
Pursuant to the provisions of Section 139 of the Act and the rulesframed thereunderM/s. Lovelock& Lewes Chartered Accountants were appointed as Statutory Auditors ofthe Company for a period of five years at the 17th Annual General Meeting (AGM) of theCompany held on 8th September 2014 subject to ratification of their appointment at everyAGM. Their reappointment for the year 2018-19 is required to be ratified by theshareholders at the ensuing 21st AGM of the Company.
15. Auditors' report and secretarial auditors' report
The auditors' report and secretarial auditors' report are selfexplanatory and does notcontain any qualifications reservations or adverse remarks and have been annexed to thereport.
16. Risk management
Although the requirement of Risk Management Committee is not mandatory for yourCompany the management has to constantly monitor the risks and functions andsystematically
address them through mitigating actions on a continuous basis. The audit committee hasadditional oversight in the area of financial risks and controls.
The development and implementation of risk management policy has been covered in themanagement discussion and analysis which forms part of the Corporate Governance Report.
17. Particulars of loans guarantees and investments
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
18. Transactions with Related Parties
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company had not entered into anycontract/arrangement/transaction with related parties which could be considered materialin accordance with the policy of the Company on materiality of related party transactions.
Your Directors draw attention of the members to Note No. 40 to the financial statementwhich sets out related party disclosures.
19. Management's Discussion And Analysis Report
The Management's Discussion and Analysis Report for the year under review asstipulated under the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 forms part of the Corporate Governance Report.
20. Corporate Social Responsibility
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure I of this report in the format prescribed in the Companies (CorporateSocial Responsibility Policy) Rules 2014. The policy is available on the Company'swebsite: www.dhunseritea.com.
21. ExtractofAnnual Return
As stipulated under Section 92(3) of the Act an extract of annual return is given inAnnexure II in the prescribed Form MGT-9 which forms part of this report.
22. 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:
|Non-executive Directors ||Remuneration for the Year ended 31.03.2018 (^) ||Ratio to median remuneration |
|1. Mr. Mrigank Dhanuka (till 14.02.2018) ||20000 ||* |
|2. Mr. R.K. Sharma ||40000 ||0.66:1 |
|3. Mr. Bharat Bajoria ||65000 ||1.07:1 |
|4. Mr. Basudeo Beriwala ||95000 ||1.56:1 |
|5. Ms. Nandini Khaitan ||65000 ||1.07:1 |
|6. Mr. Ashok Kumar Lohia (upto 10.08.2017) ||Nil || |
|7. Mr.VivekGoenka (w.e.f30.08.2018) ||60000 || |
|Executive Directors || || |
|1. Mr. C.K. Dhanuka ||2937727 ||48.16:1 |
|2. Mr. Mrigank Dhanuka (w.e.f. 14.02.2018) ||386590 || |
The median remuneration of employees for financial year 2017-18 is f 0.61 lacs.
b. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year:
|Directors Chief Executive Officer |
Chief Financial Officer and Company Secretary
|% increase in remuneration in the financial year |
|1 Mr. C. K. Dhanuka Managing Director ||-23.63 |
|2. Mr. Mrigank Dhanuka Executive Director(w.e.f.14.02.2018) ||* |
|3 Mr. Bharat Bajoria ||No change |
|4. Mr. Basudeo Beriwala ||No change |
|5. Ms. Nandini Khaitan ||No change |
|6 Mr. Ashok Kumar Lohia (upto 10.08.2017) ||* |
|7. Mr. R. K. Sharma ||No change |
|8. Mr. Vivek Goenka (w.e.f. 30.08.2017) || |
|9. Mr. P C. Dhandhania Chief Executive Officer ||0.21 |
|10. Ms. Bhavna Khemka Chief Financial Officer (upto 14.12.2017) ||* |
|11. Mr. VikashJain Chief Financial Officer(w.e.f. 14.12.2017) || |
|12. Mr. R. Mahadevan CompanySecretary ||10.35 |
* Since this information is for part of the year the same is not comparable.
c. The percentage increase in the median remuneration of employees in the financialyear: 5.36 %.
d. The number of permanent employees on the rolls of Company: 5025.
e. Average percentile increase / decrease already made in the salaries of employeesother than the managerial personnel in the last financial year and its comparison with thepercentile increase/decrease in the managerial remuneration and justification thereof andpoint out if there are any exceptional circumstances for increase in the managerialremuneration :
Average percentile increase / decrease already made in the salaries of employees otherthan the managerial personnel in the financial year 2017-18 was -0.17 % and in the case ofmanagerial remuneration the increase / decrease was - 37.00 %. The remuneration payable toexecutive directors has variable component which is dependent on the profit of the Companyand other employees remuneration has fixed pay which depends on his/ her performance.
f. Affirmation that the remuneration is as per the remuneration policy of the Company:The Company affirms remuneration is as per the remuneration policy of the Company.
g. The statement containing particulars of employees as required under Section 197(12)of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is set out in Annexure IV forming part of this report.
23. Disclosure requirements
As stipulated under the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 the corporate governance report along with theauditors' certificate thereon and management discussion and analysis are attached whichform part of this report.
The code of conduct for the board of directors and the senior management adopted by theCompany is available on the Company's website (http://dhunseritea.com/investors-investors/code-of-conduct/)
Details of the familiarization programme of the independent directors are available onthe Company's website (http://dhunseritea.com/wp-content/uploads/ 2015/06/Familiarisation-Programme-of-Independent-Directors.pdf).
Policy for determining material subsidiaries of the Company is available on theCompany's website (http://dhunseritea.com/wp-content/uploads/2015/03/policy-for-determining-material- subsidiary.pdf).
Policy on dealing with related party transactions is available on the Company's website(http://dhunseritea.com/wp- content/uploads/2015/04/Related-party-transaction-policy.pdf).
The Company has formulated and published a Whistle Blower Policy to provide VigilMechanism for employees including directors of the Company to report genuine concerns Theprovisions of this policy are in line with the provisions of Section 177(9) of theCompanies Act 2013 and SEBI (LODR) Regulations 2015 and the said policy is available onthe Company's website (http://dhunseritea.com/wp-content/uploads/2015/03/vigil-mechanism.pdf).
24. 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.
25. State of Company's affairs
The present state of the company's affairs is progressive enough viz-a-viz the industryand there is no any development which could result in an adverse situation for the companyin the near future. There is neither any change in the nature of business of the Companynor any significant and material orders was passed by any regulator or court or tribunalsimpacting the going concern status affecting the company's operation in future.
26. Reporting of frauds by auditors
During the year under review the statutory auditors nor the secretarial auditor hasreported to the audit committee under Section 143(12) of the Companies Act 2013 anyinstances of fraud committed against the Company by its officers or employees the detailsof which need to be mentioned in the Board's report.
27. Secretarial Standards
The Company complies with all applicable secretarial standards.
28. Material changes and commitments if any affecting the financial position of theCompany
There are no such material changes and commitments which have occurred between the endof the financial year of the Company to which the financial statements relate and the dateof the report.
29. Particulars regarding conservation of energy & technology absorption etc
The particulars in respect of conservation of energy technology absorption and foreignexchange earnings and outgo are given in Annexure III which forms part of this report.
30. Disclosure under the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013
The Company has set up Internal Complaints Committee (ICC) under The Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013. There were nocomplaints received and /or disposed off during 2017-18. The Committee met once during theyear.
31. Green Initiatives
As part of our green initiative the electronic copies of this Annual Report includingthe Notice of the 21st AGM are sent to all members whose email addresses are registeredwith the Company / Depository Participant(s). For members who have not registered theiremail addresses physical copies of this Annual Report including the Notice of the 21stAGM are sent by permitted mode.
The Company is providing e-voting facility to all its members to enable them to casttheir votes electronically on all resolutions set forth in the Notice. This is pursuant toSection 108 of the Companies Act 2013 and Rule 20 of the Companies (Management andAdministration) Rules 2014. The instructions for e-voting is provided in Note 10 annexedto the Notice.
Your Directors take this opportunity to express their grateful appreciation for theexcellent assistance and cooperation received from the banks and other authorities. YourDirectors also thank the employees of the Company for their valuable service and supportduring the year. Your Directors also gratefully acknowledge with thanks the cooperationand support received from the shareholders of the Company.
| ||For and on behalf of the Board of Directors |
|Kolkata ||C.K.DHANUKA |
|21st May 2018 ||Chairman |