Your Directors present herewith Thirty Seventh Annual Report together with auditedstatement of accounts for the year ended 31st March 2020.
|Particulars ||As on 31.03.2020 ||As on 31.03.2019 |
|Sales Turnover ||4912.48 ||6005.95 |
|Profit / (Loss) before Depreciation and Interest ||570.49 ||588.13 |
|Less: - Interest ||442.08 ||399.38 |
|Less: - Depreciation ||61.00 ||63.54 |
|Net Profit / (Loss) before Tax ||67.40 ||125.21 |
|Less: - Tax || || |
|- Current tax ||26.43 ||42.94 |
|- Earlier Tax ||7.66 ||1.00 |
|- Deferred Tax Liabilities / (Assets) ||(2.35) ||(18.96) |
|Net Profit after Tax ||35.66 ||100.22 |
|Profit / (Loss) brought forward ||1038.63 ||938.41 |
|Balance Carried to Balance Sheet ||1074.28 ||1038.63 |
In the last month of financial year 2019-20 the COVID-19 pandemic developed rapidlyinto a global crisis forcing governments to enforce lock-downs of all economic activity.For the Company the focus immediately shifted to ensuring the health and well-being ofall employees the switch to work from home for employees all over to work remotely andsecurely.
MANAGEMENT OUTLOOK FOR THE YEAR 2020-21
Due to the pandemic a lot of project works at different stages during the firstquarter suffered because of the migrant crisis. A lot of workers went home leaving theproject and almost no work could be done in the first quarter. This would result into avery weak first quarter. Our efforts will be to overcome the shortfalls in the remainingthree quarters. The economy also will pick up once the lockdown restrictions are lifted.We will be able to resume and try to maximize the sales in the remaining quarters toachieve our target of at least 20% growth than last year. Hence the Company will reviseits target to Rs. 60.00 Crores for the upcoming year.
The Company could continue to maintain its growth during the year under review andcould have achieved a little more than what is already done. However the onset ofCOVID-19 as early as January 2020 in China and later WHO declaring it as a"Pandemic" in early March 2020 and the
subsequent nationwide lockdown decelerated the activities bringing it to a grindinghalt during the last few days of March 2020.
Notwithstanding the above the Company finds silver lining in the fact that the IndianOil & Gas market is undergoing a rapid transformation over the recent past. Thecountry offers a strong growth outlook with significant new investment opportunities inthe medium to long term future; in particular domestic and foreign companies planning toexpand their operations in the India midstream and downstream oil and gas industry willwitness new opportunities.
The Indian economy is likely to rebound in the second half of 2020 as the impact of theCOVID-19 pandemic recedes and is projected to grow by 6.7 per cent in the next financialyear
Oil and gas sector is among the eight core industries in India and plays a major rolein influencing decision making for all the other important sections of the economy.
India's economic growth is closely related to its energy demand therefore the needfor oil and gas is projected to grow more thereby making the sector quite conducive forinvestment.
Following are some of the major investments and developments in the oil and gas sector:
In March 2020 Indian Oil Corp (IOC) began supply of the world's cleanest petroland diesel across the country with all its 28000 petrol pumps dispensing ultra-lowsulphur fuel a good two weeks before the April 1 deadline.
Indian Oil Corporation (IOC) plans to invest Rs 500 crore (US$ 71.54 million) atChitradurga in Karnataka.
ExxonMobil and ONGC signed a memorandum of understanding (MoU) for offshoreblocks.
MoU signed between NSIC & ARAMCO Asia for development in Oil & GasSector.
Foreign investors will have opportunities to invest in projects worth US$ 300billion in India as the country looks to cut reliance on oil import by 10 per cent by 2022according to Mr Dharmendra Pradhan Minister of Petroleum and Natural Gas Government ofIndia.
ONGC was going to invest Rs 17615 crore (US$ 2.73 billion) on drilling oil andgas wells in 2018-19.
Some of the major initiatives taken by the Government of India to promote oil and gassector are:
State run energy firms Bharat Petroleum Hindustan Petroleum and Indian OilCorporation plan to spend US$ 20 billion on refinery expansions to add units by 2022.
The Government is planning to set up around 5000 compressed biogas (CBG) plantsby 2023.
The Government is planning to invest US$ 2.86 billion in the upstream oil andgas production to double natural gas production to 60 bcm and drill more than 120exploration wells by 2022.
Government of India is planning to invest Rs 70000 crore (US$ 9.97 billion) toexpand the gas pipeline network across the country.
In September 2018 Government of India approved fiscal incentives to attractinvestment and technology to improve recovery from oil fields which is expected to leadto hydrocarbon production worth Rs 50 lakh crore (US$ 745.82 billion) in the next 20years.
State-run oil firms are planning investment worth Rs 723 crore (US$ 111.30million) in Uttar Pradesh to improve the LPG infrastructure in a bid to promote cleanenergy and generate employment.
The Oil Ministry plans to set up bio-CNG (compressed natural gas) plants andallied infrastructure at a cost of Rs 7000 crore (US$ 1.10 billion) to promote the use ofclean fuel.
The Dividend for the year ended 31st March 2020 is not advisable as inorder to conserve the resources your Directors feel that the profits be retained in thebusiness to overcome any unforeseen difficulties due to the pandemic gripping the world.
TRANSFER TO RESERVE
The Company has not transferred any amount to the Reserves during the year.
MANAGEMENT DISCUSSION & ANALYSIS REPORTS
The Management Discussion and Analysis of financial condition including the results ofoperations of the Company for the year under review as required under Regulation 34(2)(e)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isprovided as a separate section forming part of the Annual Report.
MATERIAL CHANGES AND COMMITMENT AFFECTING THE FINANCIAL POSITION
There are no material changes affecting the financial position of the Companysubsequent to the close of the FY 2019-20 till the date of this report.
The Company has not accepted any deposit or unsecured loans from the public within themeaning of Section 73 of the Companies Act 2013 read with The Companies (Acceptance ofdeposit by Companies) Rules 2014.
The Authorized Capital of the Company is 40000000 Equity shares of the Company ofRs. 4/- each and the paid capital of the Company as on 31.03.2020 is 19036400 Equityshares of the Company of Rs. 4/- each.
During the year under review the Company has not issued shares with differentialvoting rights nor has issued any sweat equity. As on March 31 2020 none of the Directorsof the Company hold any convertible instruments of the Company.
During the year under review Mrs. Sajeda Mewawala retires by rotation and beingeligible offer herself for re-appointment.
Mr. Hasanain Mewawala Managing Director complete the term of 5 years of appointment on16.11.2020 and his re-appointment is placed before the members at the ensuing AnnualGeneral Meeting of the Company. Except this there are no changes in the directors of theCompany.
DECLARATION BY AN INDEPENDENT DIRECTOR(S)
The Independent Directors have submitted a declaration that they meet the criteria ofindependence and that they are not aware of any circumstance or situation which exist ormay be reasonably anticipated that could impair or impact their ability to dischargetheir duties with an objective independent judgment and without any external influencepursuant to Regulation 25 of the Listing Regulations. Further declaration on compliancewith Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules 2014as amended by Ministry of Corporate Affairs ("MCA") Notification dated October22 2019 regarding the requirement relating to enrolment in the Data Bank created by MCAfor Independent Directors has been received from all the Independent Directors.
Pursuant to the provisions of Section 149 of the Act the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) ofListing Regulations.
In terms of Regulation 25(8) of the Listing Regulations the Independent Directors haveconfirmed that 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.
Based on the confirmation / disclosures received from the Directors the followingNon-Executive Directors are Independent as on March 31 2020:
1) Mr. SajjadHussein Nathani
2) Mr. Shailesh Shah
3) Mr. Tribhuwan Nath Tripathi
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE ITS COMMITTES AND INDIVIDUALDIRECTORS
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. In a separate meeting ofindependent directors performance of non-independent directors the Board as a whole andthe Chairman of the Company was evaluated taking into account the views of executivedirectors and non-executive directors. The results of the evaluation are satisfactory andadequate and meet the requirement of the Company.
Pursuant to Section 134(3)(b) details of Board meeting held in the year is reflectedin the Corporate Governance Report.
During the year Six (6) Board Meetings and Five (5) Audit Committee Meetings were held.The details of which are given in the Corporate Governance Report. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013.
A separate meeting of Independent Directors pursuant to Section 149 (7) read withSchedule VI of the Companies Act 2013 was held on 02.03.2020
NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Nomination and Remuneration Policy is posted on the website of theCompany.
The Company does not fall under purview of Regulations of Corporate Governance pursuantto the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. Howeverthe same is applicable as per the Companies Act 2013 and the Company is fully compliantwith the applicable provision and the Company is committed to ensure compliance with allmodification within prescribed norms under Companies Act 2013. Company is committed tomaintain the highest standards of corporate practices a separate section on CorporateGovernance is provided as part of this Annual Report.
M/s. J. H. Gandhi & Co Chartered Accountant were appointed as the statutoryAuditors for a block of 5 years to hold the office till the conclusion of the 39thAnnual General Meeting and that the Board is authorized to fix the remuneration as may bedetermined by the Audit Committee in consultation with the Auditors. In view of this M/s.J. H. Gandhi & Co Chartered Accountants continue as statutory auditor for FY2020-2021.
The Auditors Report for the Financial Year ended March 31 2020 does not contain anyqualification reservation or adverse remark.
As required under the new Companies Act 2013 the Company has appointed an InternalAuditor. The other observations of Auditors are self-explanatory in the notes referred toby them.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorshas appointed M/s. ND & Associates a firm of Company Secretaries in Practice toundertake the secretarial Audit of the Company. The Report of the Secretarial Audit Reportis annexed herewith as "Annexure A."
RISK MANAGEMENT POLICY
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks to key business objectives. Major risks identified by the businesses and functionsare systematically addressed through mitigating actions on a continuing basis. These arediscussed at the meetings of the Board of Directors of the Company.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
The company is having in place Internal Financial Control System. The InternalFinancial Control with reference to the financial statement was adequate and operatingeffectively.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Board of Directors has formulated a Whistle Blower Policy in compliance with theSection 177(10) read with Regulation 22 of SEBI (Listing Obligation and DisclosureRequirement) Regulations 2015. The Company has a vigil mechanism to deal with instance offraud and mismanagement if any. The policy is in place and the Company has uploaded thesame to its website.
PARTICULARS OF LOAN GUARANTEE & INVESTMENTS
The particulars of loans guarantees and investments as per Section 186 of the Act bythe Company have been disclosed in the financial statements.
ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
The information required under Section 134 (3) (m) of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 with respect to conservation of energy technologyabsorption and foreign exchange earnings/outgo is given hereto and forms a part of thisreport.
FORM - A
Form for disclosure of particulars with respect to Conservation of Energy.
|Power and Fuel Consumption ||Current year 31.03.2020 ||Current year 31.03.2019 |
|1) Electricity || || |
|Purchase Unit (KWH) ||3.07 ||2.84 |
|Total Amount (Rupees in lacs) ||41.17 ||28.65 |
|Rate per Unit (Rupees) ||13.39 ||10.08 |
|2) Coal ||N.A ||N.A |
|3) Furnace Oil ||N.A. ||N.A. |
|4) Internal Generation ||N.A. ||N.A. |
TECHNOLOGY ABSORPTION ADAPTATION AND INNOVATION
Energy conservation is not only a national priority but also a key value driver foryour Company. Employees are also encouraged to give suggestion that will result in energysaving.
As prescribed under the Section 134 (3) (m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 is not applicable as there is no technology absorptionadaptation and innovation made by your Company in the goods manufactured.
FOREIGN EXCHANGE EARNING AND OUTGO
| || |
Rs. in Lacs
|i) CIF Value of Imports || |
|ii) Expenditure in foreign currency || |
|iii) Foreign Exchange earned || |
PARTICULARS OF EMPLOYEES
The information required under section 197 of the Companies Act 2013 read with Rule 5of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of employees of the Company are given below:
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
|Executive Director ||Ratio to median remuneration |
|Hasanain S. Mewawala ||3.23 |
|Non- executive Directors ||Ratio to median remuneration |
|NIL ||NIL |
b. The percentage increase in remuneration of each director chief executive officerchief financial officer company secretary in the financial year:
There is no increase in the remuneration of Mr. Hasanain S. Mewawala
c. The percentage increase in the median remuneration of employees in the financialyear: -8.11%
d. The number of permanent employees on the rolls of the Company: 72 (Excluding KeyManagerial Personnel)
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:
Average percentile increase made in the salaries of employees was around -8.11% afteraccounting for promotions and other event based compensation revisions. There is moderateincrease in salaries of high remuneration group. Few employees from high remunerationgroup have resigned and new employment in medium remuneration category. Hence though thenumber of employee increased from 59 to 72 percentage is in minus.
f. Affirmation that the remuneration is as per the remuneration policy of the Company:
Pursuant to Rule 5(1)(xii) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 it is affirmed that the remuneration paid to the Directors KeyManagerial Personnel and Senior Management is as per the Remuneration Policy of yourCompany.
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) Rule 2014: Not applicable (NA)
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) extract of Annual Return in Form MGT-9 has been uploaded onthe website of the Company.
The Company does not have any subsidiary.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large.
During the year the Company has revised the Policy on Materiality of Related PartyTransactions and the same was approved by the Board in their meeting held on 29.03.2019.The said policy is made applicable from 01.04.2019. The revised policy is uploaded on thewebsite of the Company.
DIRECTORS' RESPONSIBILTY STATEMENT AS REQUIRED UNDER SECTION 134(3)(c) OF THE COMPANIESACT 2013
The Directors state that: -
a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation by way of notes to accounts relating tomaterial departures;
b) The selected accounting policies were applied consistently and the judgments andestimates made by them are reasonable and prudent so as to give true and fair view of thestate of affairs of the Company as at 31st March 2020 and of the profit for theyear ended on that date;
c) The proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The annual accounts have been prepared on a going concern basis.
e) The Directors had laid down internal financial controls to be followed by theCompany and that such internal controls are adequate and were operating effectively.
f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
Industrial Relations continued to be harmonious throughout the year under review. Manyinitiatives have been taken to support business through organizational efficiency processchange support and various employee engagement programs which has helped the Organizationachieve higher productivity levels.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance beyond threshold limit mentioned in the policyfor dealing in the Company's shares and prohibits the purchase or sale of Company sharesby the Directors and the designated employees while in possession of unpublished pricesensitive information in relation to the Company and during the period when the TradingWindow is closed.
As per the requirements of Regulation 8(1) of Securities and Exchange Board of India(Prohibition of Insider Trading) Regulation 2015 the Company has formulated code of fairdisclosure of unpublished price sensitive information and has uploaded the same on theofficial website of the Company. All Board Directors and the designated employees haveconfirmed compliance with the Code.
STATEMENT PURSUANT TO LISTING AGREEMENT
The Company's Equity shares are listed at Bombay Stock Exchange Limited. The AnnualListing fee for the year 2020-21 has been paid.
None of the Directors of the Company are disqualified as per provisions of Section164(2) of the Companies Act 2013. Your Directors have made necessary disclosures asrequired under various provisions of the Companies Act 2013 and Listing regulations.Certificate as required under Part C of Schedule V of Listing Regulations is enclosed asAnnexure B'.
QUALITY/ SAFETY CERTIFICATIONS
Your Company has obtained the prestigious OSHAS (18001) certification. Your Company isalso ISO 9001& 14001 certified by URS.
COMMITTEE AND POLICY UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION ANDREDRESSAL) ACT 2013
The Company has constituted Internal Complaints Committee under and as per the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. Duringthe year under review no instance of compliant or report under the said Act wasregistered in any of the units of the Company.
CORPORATE SOCIAL RESPONSIBILITY
As per the Section 134 (o) Corporate Social Responsibility is not applicable to ourCompany. INDUSTRIAL RELATIONS
During the year under review your Company enjoyed cordial relationship with contractorand employees at all levels.
Your Directors place on record their deep appreciation to employees at all levels fortheir hard work dedication and commitment. The enthusiasm and unstinting efforts of theemployees have enabled the Company to remain an industry leader.
The Board places on record its appreciation for the support and co-operation yourCompany has been receiving from its suppliers distributors retailers and othersassociated with it.
Your Directors also take this opportunity to thank all Shareholders Clients VendorsBanks Government and Regulatory Authorities and Stock Exchanges for their continuedsupport.
For and on behalf of the Board For Expo Gas Containers Limited
(H. S. Mewawala)
Place : - Mumbai
Dated : - 28.08.2020