[Pursuant to Section 134(3) of the Companies Act 2013]
FINE-LINE CIRCUITS LIMITED
The Directors have pleasure in presenting the Twenty Ninth Annual Report together with the Financial Statements for the year ended on March 31 2019.
|(Rs. In Lakhs)|
|Revenue from Operations||3153.67||2830.61|
|Profit/ (Loss) Before Depreciation & Tax||150.86||138.86|
|Profit/(Loss) Before Tax||16.14||13.43|
|Less: Provision for Taxation|
|Short/excess provision of Income Tax|
|Profit/(Loss) After Tax||16.40||9.29|
|Other Comprehensive Income||-||-|
|Total Comprehensive Income for the Year||-||-|
|Surplus brought forward from Previous Year||219.19||206.66|
OPERATIONS/ STATE OF COMPANY'S AFFAIRS
During the year under review Sales were Rs. 3153.67 Lakhs as against Rs. 2830.61 Lakhs during the corresponding previous year resulting in a profit of Rs.16.40 Lakhs as against profit of Rs.9.29 Lakhs for the previous year.
To conserve the resources your directors do not recommend dividend on the equity shares of the Company for the financial year 2018-19.
TRANSFER TO GENERAL RESERVES
Rs. 243.25 Lakhs is proposed to be retained in the Profit & Loss A/c of the company.
Your company has had growth for last two consecutive years and the Outlook is Positive.
New Products and New markets have been the focus in the last few years and due to this we have added to our Product offering PCBs with new materials and surface finishes and exported to multiple new markets spread across 14 countries.
RF Microwave PCBs with special materials with special surface finishes and of special designs has resulted in good business growth and continues to show promise for the future. Further the company has put in place a New Product pipeline and this will augur well in the coming years. Also your company has identified fertile new markets to penetrate which will also augur well in the coming years whilst still being well rooted in its main markets of USA Germany and India.
We can proudly say the company has come alive after a decade of struggle and slumber and is poised to rise to a higher level of performance.
MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR
There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of the report.
NUMBER OF MEETINGS OF BOARD OF DIRECTORS
4 (Four) meetings of the Board of Directors were held during the year.Details of the Meetings of the board are referred in the Corporate Governance Report which forms part of this report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Shri. B.T. Doshi (DIN: 00040596) Director of the Company retires at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.
Shri Abhay Doshi (DIN 00040644) was re-appointed as Managing Director for three years with effect from April 01 2019 and Shri. Rajiv Doshi (DIN 00651098) was re-appointed as Whole-time Director for three years with effect from April 01 2019.The resolutions seeking approval of the members for their re-appointment and remuneration has been incorporated in the notice of the ensuing AGM.
Shri R.M.Premkumar (DIN 00328942) Shri. Juzer Vasi (DIN 00040682) and Shri. Apurva Shah (DIN 0000478) were appointed as an Independent Director at the Twenty Fourth AGM held on August 09 2014 for a period of five years. Based on the recommendation of the Nomination and Remuneration Committee their re-appointment for a second term of five years is proposed at the ensuing AGM for the approval of the Members by way of special resolution.
Smt. Kumudini Mehta (DIN 03191065) was appointed as an Independent Director at the Twenty Fifth AGM held on August 08 2015 for a period of five years with effect from March 28 2015. Based on the recommendation of the Nomination and Remuneration Committee her re-appointment for a second term of five years is proposed at the ensuing AGM for the approval of the Members by way of Special Resolution.
DECLARATION FROM INDEPENDENT DIRECTORS
The Independent Directors have submitted declarations that each of them meet the criteria of independence as provided in Section 149(6) of the Companies Act 2013 (the Act) along with Rules framed thereunder and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 (SEBI Listing Regulations). There has been no change in the circumstances affecting their status as independent directors of the Company.
AUDIT COMMITTEE OF BOARD OF DIRECTORS
The Audit committee of the Board of Directors of the Company consists of the following members
1. Shri. Apurva Shah
2. Shri R.M.Premkumar
3. Smt. Kumudini Mehta
The Company has formulated a Whistle Blower Policy to provide a mechanism (Vigil Mechanism) for employees including Directors of the Company to report genuine concerns.The provisions of this policy are in line with the provisions of the Section 177 (9) of the Act and the revised Listing Regulations.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND CRITERIA FOR INDEPENDENT DIRECTORS
The Remuneration Policy for directors and Senior Management and the Criteria for selection of candidates for appointment as Directors Independent Directors Senior Management as adopted by the Board of Directors are placed on the website of the Company (http://www.finelineindia.com/investors-relations/policies/criteria-for-selection-of-candidates-for-senior-management-and-members-on-the-board-of-directors/). There has been no change in the policies since the last fiscal year. We affirm that the remuneration paid to the directors is as per the terms laid out in the remuneration policy of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to the best of their knowledge and ability confirm that:
(i) in the preparation of the Annual Accounts the applicable accounting standards have been followed and there are no material departures;
(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) they have prepared the Annual Accounts on a going concern basis;
(v) they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;
(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has proper and adequate system of internal financial controls commensurate with its nature and size of business and meets the following objectives:
Providing assurance regarding the effectiveness and efficiency of operations??Efficient use and safeguarding of resources??Compliance with policies procedures and applicable laws and regulations and??Transactions being accurately reported and recorded timely
The Company has budgetary control system to monitor expenditures and operations against budgets on an ongoing basis.
The Internal Auditor also regularly reviews the adequacy of internal financial control system.
DETAILS OF SUBSIDIARIES/ JOINT VENTURES/ ASSOCIATES
The Company does not have any subsidiary/ joint ventures/ associates.
EXTRACT OF ANNUAL RETURN
As provided under sub Section (3) of Section 92 of the Act the extract of annual return is enclosed which forms part of the Boards' report as Annexure I. The same is available on (http://www.finelineindia.com/investors-relations/policies/ extract-of-annual-return/)
At the twenty-eighth AGM held on September 29 2018 the members approved appointment of M/s. Ratanghayara & Co Chartered Accountants (Membership No. 103325 / Firm Registration No. 117626W) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of that AGM till the conclusion of the thirty-third AGM. The requirement to place them atter relating to appointment of auditors for ratification by Members at every AGM has been done away by the Companies (Amendment) Act 2017 with effect from May 7 2018. Accordingly no resolution is being proposed for ratification of appointment of Statutory Auditors at the ensuing AGM and a note in respect of same has been included in the Notice for this AGM.
Pursuant to the provisions of Section 204 and other applicable provisions if any of the Companies Act 2013 M/s. Parikh & Associates Practicing Company Secretaries were appointed as the Secretarial Auditor for auditing the secretarial records of the Company for the financial year 2018-19.
The Secretarial Auditors' Report is annexed as Annexure II.
AUDITOR'S REPORT AND SECRETARIAL AUDITOR'S REPORT
The statutory auditors' report and secretarial auditor's report does not contain any qualifications reservations or adverse remarks.
CONSERVATION OF ENERGY TECHNOLOGY ABSORBTION FOREIGN EXCHANGE EARNINGS AND OUTGO
Information in accordance with Clause (m) of Sub-section (3) of Section 134 of the Act read with Companies (Accounts) Rules 2014 is annexed to this report as Annexure III.
PARTICULARS OF EMPLOYEES
Pursuant to Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the particulars of employees are annexed as Annexure IV.
DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from public and as such no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORY / JUDICIAL AUTHORITY
There are nosignificant or material orders passed by any regulator or court that would impact the going concern status of the Company and its future operations.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The Company has not given any loans or guarantees or made investments in contravention of the provisions of the Section 186 of the Companies Act 2013.
RISK MANAGEMENT POLICY
The Board of Directors of the Company has framed a risk management policy and is responsible for reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.
RELATED PARTY TRANSACTIONS
The company has not entered into related party transactions as per Section 188 of the Act during the year and hence particulars of transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014 in Form AOC-2 is not applicable to the company.
EVALUATION OF BOARD ITS COMMITTEES AND INDIVIDUAL DIRECTORS
An annual evaluation of the Board's own performance Board committees and individual directors was carried out pursuant to the provisions of the Act in the following manner:
|Sr. No.||Performance evaluation of||Performance evaluation performed by||Criteria|
|1.||Each Individual directors||Nomination and Remuneration Committee||Attendance Contribution to the Board and committee meetings like preparedness on the issues to be discussed meaningful and constructive contribution and guidance provided key performance aspects in case of executive directors etc.|
|2.||Independent directors||Entire Board of Directors excluding the director who is being evaluated||Attendance Contribution to the Board and committee meetings like preparedness on the issues to be discussed meaningful and constructive contribution and guidance provided etc.|
|3.||Board and its committees||All directors||Board composition and structure; effectiveness of Board processes information and functioning fulfilment of key responsibilities performance of specific duties and obligations timely flow of information etc.|
|The assessment of committees based on the terms of reference of the committees and effectiveness of the meetings.|
DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:
The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention prohibition and Redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Work-place (Prevention Prohibition and Redressal) Act 2013 and the rules framed there under.
The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and has not received any complaint of sexual harassment during the financial year 2018-19.
PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON-EXECUTIVE DIRECTORS
During the year the non-executive directors of the Company had no pecuniary relationship or transactions with the Company.
As per SEBI Listing Regulations corporate governance report with auditors' certificate thereon and a management discussion and analysis are attached which forms part of this report.
Details of the familiarization program of the independent directors are disclosed on the website of the Company (http:/ /www.finelineindia.com/investors-relations/policies/familiarisation-programme-for-independent-directors/)
Policy on dealing with related party transactions is disclosed on the website of the Company (http://www.finelineindia.com/ investors-relations/policies/policy-on-related-party-transactions/)
LISTING AGREEMENT AND LISTING FEES
The Company entered into Listing Agreement with BSE Limited in terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 issued on September 2 2015 effective from December 1 2015.
The Company has paid the listing fees to BSE Limited for the year 2018-19.
INSIDER TRADING REGULATIONS AND CODE OF DISCLOSURE
The Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information and Code of Internal Procedures and Conduct for Regulating Monitoring and Reporting of Trading by Insiders in accordance with the requirements of the SEBI (Prohibition of Insider Trading) Regulation 2015 as amended is available on our website. (http://www.finelineindia.com)
The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively.
We acknowledge our appreciation to our clientele and vendors for their invaluable support during the year.
We also place on record our deep appreciation for the contribution made by the staff and the contract workmen at all levels. Their contribution has in no small measure enabled the Company to remain competitive.
Grateful thanks are also due to SEEPZ-SEZ Authorities for their continued support extended to the Company from time to time.
Shareholders' appreciation for the management's efforts in such competitive times at the General Meeting of the Company will be of great fillip to strive for better performance in spite of severe competitive factors faced by the Company.
|On behalf of the board of directors|
|Date: May 25 2019||Bhagwandas T. Doshi|