Flexituff Ventures International Limited
(Formerly Flexituff International Limited)
The Board of Directors hereby presents its 26th Director's Report onbusiness & operations of your Company ('the Company' or 'FVIL') alongwith AuditedFinancial Statements (Standalone & Consolidated) for the financial year ended 31stMarch 2019.
The Company's Financial Performance for the year ended 31st March 2019 issummarized below:
|FINANCIAL RESULTS AND APPROPRIATION || |
|Particular ||2018-19 ||2017-18 ||2018-19 ||2017-18 |
|Sales & other Incomes ||12016.99 ||11866.09 ||12663.98 ||12929.22 |
|Profit before Interest Depreciation & Tax ||1578.21 ||1861.38 ||1500.97 ||1859.43 |
|Profit/(Loss) before Tax ||(215.64) ||9.07 ||(295.04) ||(14.07) |
|Profit/(Loss) for the year / Balance available for Appropriation ||(157.76) ||(23.44) ||(235.53) ||(43.32) |
|Other Comprehensive (Loss)/Income ||(0.48) ||4.46 ||(1.97) ||4.46 |
|Total Other Comprehensive (Loss)/Income ||(158.24) ||(18.98) ||(237.50) ||(38.86) |
STATE OF COMPANY'S AFFAIRS
During the year under review the company has achieved consolidated total revenue andprofit before interest depreciation and tax of Rs. 12663.97 Million and Rs. 1500.97Million respectively as against total revenue and profit before interest depreciation andtax of Rs. 12929.22 Million and Rs. 1859.43 Million respectively during the previousfinancial year.
Further the company has achieved standalone total revenue and profit before interestdepreciation and tax of Rs. 12016.99 Million and Rs. 1578.21 Million respectively asagainst total revenue and profit before interest depreciation and tax of Rs. 11866.09Million and Rs. 1861.38 Million respectively during the previous financial year.
During the year under review Company didn't generate enough revenue/surplus to declaredividend hence your directors do not propose any dividend for the Financial Year ended 31stMarch 2019.
The paid up Equity Share Capital as on 31st March 2019 was Rs. 248.83Million divided into 24882806 shares of Rs. 10/- each.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review forms part of theAnnual Report.
AWARDS & CERTIFICATIONS
Company is certified for British Retail Consortium Certificate (BRC) ISO 9001:2015(for Quality Management System) ISO 14001:2015 (for Environmental Management) ISO22000:2005 (for Food and Safety Management) and OHSAS 18001:2007 (for Industrial Healthand Safety).
During the year Company achieved A Grade under Global Standard for Packaging &Packaging Material and the Company was inspected by a Qualified AIB Inspector underrequirements of AIB International and was announced to be on 925/1000.
The Company has received the Country's Highest Exporter Award for FIBC throughPLEXCOUNCIL Ministry of Commerce for 13 years in a row.
The Company has also achieved recognition from all its foreign buyers for its deliveryand services. In geo-textile sector the Company has received appreciation for its uniqueproducts and new technologies being introduced to solve the problems of the countryespecially related to flood protection & water cleaning.
The credit rating assigned by ICRA Limited as on 31st March 2019 was "B+Mrating for the Long term loan and "A4" for Short term Non-Fund BasedLimits which indicates "negative" outlook.
Your Board opined and states that due to outstanding repayments of FCCBs of TPG GrowthII PTE Ltd (TPG) & International Finance Corporation (IFC) the credit rating of theCompany gets highly impacted. Although during the year under review TPG's bondholdersconsented to extend the tenure of repayment by 48 months being final new maturity date as30s1 June 2022. The Company has also submitted its request and proposal toIFC's bondholders in same line with TPG the matter is under consideration with IFC.
During the year under review Nanofil Technologies Private Limited ceased to be whollyowned subsidiary of the Company.
The Company has 2 Direct Subsidiaries 1 Indirect Subsidiary 6 Joint Ventures and 5LLPs as on 31st March 2019.
There are no associate companies within the meaning of Section 2(6) of the CompaniesAct 2013 ("Act"). There has been no material change in the nature of thebusiness of the subsidiaries and Joint Ventures.
Flexituff Technology International Limited (Formerly known as Flexituff FIBCLimited)
Flexiglobal Holdings Limited Cyprus
Flexiglobal (UK) Limited UK
Flexituff Javed Ahmed LLP
Flexituff Hi-Tech LLP
Flexituff SA Enterprise LLP
Flexituff Sailendra Kalita LLP
Ujjivan LUIT LLP
Budheswar Das Flexituff International Limited JV
Sanyug Enterprises Flexituff International Limited JV
Vishnu Construction Flexituff International Limited JV
Mayur Kartick Barooah Flexituff International Limited JV
Flexituff Shailendra Kalita JV
Flexituff Pulin Borgohain JV
Pursuant to the provisions of Section 136 of the Companies Act 2013 the financialstatements of the Company consolidated financial statements along with relevant documentsand separate audited accounts in respect of subsidiaries are put up on the website of theCompany (www.flexituff.com) and shall be made available upon request of any member of theCompany interested in obtaining the same and shall also be kept for inspection on allworking days during business hours at the Registered Office of the Company and that ofthe Subsidiary Companies concerned.
Company has formulated a policy for determining material subsidiaries which can beaccessed at the below link:-
Further pursuant to provisions of Section 129(3) of the Companies Act 2013 astatement containing salient features of the financial data of the Company's Subsidiaries& Joint Ventures is mentioned in Form AOC-1 as Annexure A' of the board'sreport.
The Directors state that applicable Secretarial Standards i.e. SS-1 & SS-2relating to "Meetings of the Board of Directors" and "GeneralMeetings" respectively have been duly followed by the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that:
a.) In the preparation of annual accounts for the year ended 31st March2019 the applicable accounting standards had been followed along with proper explanationrelating to material departures.
b. ) the Directors have selected such accounting policies and applied them consistentlyand made judgments 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 loss of the Company for that period.
c. ) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
d. ) the Directors have prepared the annual accounts on a going concern basis.
e. ) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f. ) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
The report on Corporate Governance as stipulated under the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 ("Listing Regulations") forms anintegral part of this Report. The requisite certificate from the Practicing CompanySecretary confirming compliance with the conditions of Corporate Governance is attached tothe report on Corporate Governance.
RELATED PARTY TRANSACTION
There have been no materially significant Related Party Transactions between theCompany & the Directors Management Subsidiaries or relatives except for thosedisclosed in the Financial Statements.
Accordingly particulars of Contracts or Arrangements with Related Party Transactionsreferred to in Section 188(1) of the Act in Form AOC-2 does not form part of Directors'Report.
A Policy on Related Party Transactions as approved by the Board can be accessed on theCompany's website at:
CORPORATE SOCIAL RESPONSILBILITY
The Corporate Social Responsibility Committee has formulated and recommended to theBoard a Corporate Social Responsibility Policy (CSR Policy) indicating the activities tobe undertaken by the Company which has been approved by the Board.
The CSR policy can be accessed on the Company's website at:
The Annual Report on CSR activities is annexed herewith marked as Annexure C' tothis Report.
The Company has not accepted any deposits from the public and as such there are nooutstanding deposits in terms of the Companies (Acceptance of Deposits) Rules 2014.
In today's economic environment Risk Management is a very important part of business.The main aim of risk management is to identify monitor & take precautionary measuresin respect of the events that may pose risks for the business. The Board & AuditCommittee is responsible for reviewing the risk management plan and ensuring itseffectiveness. Major risks identified by the businesses and functions are systematicallyaddressed through mitigating actions on a continuing basis by keeping Risk ManagementReport before the Board & Audit Committee periodically.
The Risk Management Policy can be accessed on the Company's website at:
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
Details in respect of adequacy of internal financial controls with reference to theFinancial Statements are stated in Management Discussion and Analysis which forms part ofthis Report.
DIRECTORS / KEY MANAGERIAL PERSONNEL (KMPS)
The following changes occurred in the position of Directors/KMPs of the Company from 1stApril 2018 till the date of this report:
|S.No. Name of Director/KMPs ||Date of Appointment/ (Cessation) ||Event |
|1. Mr. Mahesh Sharma (DIN: 07610685) ||30/05/2018 ||Ceased to be CEO and Whole Time Director KMP due to his resignation from the Board |
|2. Mr. Ashish Jamidar (DIN: 08196328) ||14/08/2018 ||Appointed as Additional & WholeTime Director |
The Board placed on record its sincere appreciation for the invaluable contribution andguidance provided by Mr. Mahesh Sharma during his tenure and welcomes the incomingdirector.
The Company has received declaration from all the Independent
Directors of the Company confirming that they meet the criteria of independenceprescribed under the Act and the Listing Regulations.
The following policies can be accessed at website of the Company:-
a.) Terms & Conditions for appointment of Independent Director(http://flexituff.com/wpcontent/uploads/2017/09/Policies-and-Programe-Terms-Conditions.pdf)
b) Nomination & Remuneration Policy (http://flexituff.com/wp-content/uploads/2019/04/Policies-Programe- Nomination-Remuneration-Policy.pdf)
DIRECTORS SEEKING APPOINTMENT/RE- APPOINTMENT
In accordance with the provisions of the Act & Articles of Association of theCompany Mr. Anand Khandelwal (DIN: 07889346) Whole-Time Director retires by rotation atthe ensuing Annual General Meeting and Mr. Anirudh Sonpal (DIN: 03367049) IndependentDirector of the Company proposed to be reappointed at the ensuing Annual General Meeting.The Board of Directors has recommended their reappointment.
Pursuant to the applicable provisions of the Companies Act 2013 and ListingRegulations the Board has carried out the annual performance evaluation of its ownperformance its Committees the Chairman of the Company and the Directors on the basis ofthe feedback received from all the Directors of the Company.
Structured performance evaluation questionnaire were circulated to the Directors for:
Directors' - Self & Peer Level Evaluation;
Board Committees' Evaluation; and
The evaluation questionnaires broadly cover parameters such as their participation inboard meeting/other committee meeting relationship management knowledge & skilladherence to the applicable code of conduct for independent directors and maintenance ofconfidentiality etc
The summary of rating given by all the directors on the structured performanceevaluation was placed before the Board of Directors.
AUDITORS STATUTORY AUDITORS
M/s Kailash Chand Jain & Co. Chartered Accountants and M/s MSKA & Associates(formerly MZSK & Associates) Chartered Accountants were appointed as StatutoryAuditors of the Company for a term of 5 years & 3 years; respectively at the AnnualGeneral Meeting held on 22nd August 2017.
Ratification of their appointment every year is no more required pursuant to therevised provisions of Section 139 of the Companies Act 2013. The Auditors have confirmedthat they comply with all the requirements and criteria are otherwise qualified tocontinue to act as Auditors of the Company. No frauds have been reported by the Auditorsunder section 143(12) of the Companies Act 2013.
The Notes on Financial Statements referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation adverse remark or disclaimer.
M/s. Ritesh Gupta & Company Company Secretaries were appointed to conduct thesecretarial audit of the Company for the Financial Year 2018-19 as required under Section204 of the Companies Act 2013 and rules made thereunder.
The Secretarial Audit Report for the Financial Year 2018-19 forms part of the AnnualReport as Annexure B' to the Board's Report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
The Board has appointed M/s. Ritesh Gupta & Company Company Secretaries asSecretarial Auditor of the Company for the Financial Year 2019-20.
DISCLOSURES NUMBER OF MEETINGS OF THE BOARD
Four (4) meetings of the Board of Directors were held during the year under review. Thedetails of meetings held and attendance of the Directors are detailed in the CorporateGovernance Report which forms part of this report.
The details pertaining to composition meetings and attendance of audit committee areincluded in the Corporate Governance Report which forms part of this report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Loans Guarantees and Investments covered under Section 186 of the Companies Act 2013forms part of the Notes to the Financial Statements provided in this Annual Report.
The Company has a whistle blower policy/vigil mechanism to report genuine concerns orgrievances. The Whistle Blower Policy/vigil mechanism has been posted on the website ofthe Company
CODE OF CONDUCT
The Board has laid down a code of conduct for Board members & Senior ManagementPersonnel as per Regulation 17 & 26 (3) of the Listing Regulations & has beenposted on the website of the Company (http://flexituff.com/wp-content/uploads/2019/04/Policies-Programe-Code-of- Conduct.pdf)
All the Board members & Senior Management Personnel have affirmed compliance withthe said code of conduct for the year ended 31st March 2019. A declaration tothis effect signed by the Whole-Time Director forms part of this Annual Report.
The Board has adopted the Insider Trading Policy in accordance with the requirements ofthe SEBI (Prohibition of Insider Trading) Regulations 2015.The Insider trading Policy ofthe Company covering code of practices and procedures for fair disclosure of UnpublishedPrice Sensitive Information and Code of Conduct for the prevention of Insider Trading hasbeen posted on the website of the Company.
All the Board members & KMPs have affirmed compliance with the said code of conductfor the year ended 31st March 2019.
PARTICULARS OF EMPLOYEES
The statement of Disclosure of Remuneration under Section 197 of the Act and Rule 5(1)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014("Rules") is appended as Annexure-F' to the Report. The information asper Rule 5(2) of the Rules forms part of this Report. However as per first proviso toSection 136(1) of the Act and second proviso of Rule 5(2) of the Rules the Report andFinancial Statements are being sent to the Members of the Company excluding the statementof particulars of employees under Rule 5(2) of the Rules. Any Member interested inobtaining a copy of the said statement may write to the Company Secretary at theRegistered Office of the Company.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
In compliance with Section 134 of The Companies Act 2013 read with Rule 8 of TheCompanies (Accounts) Rules 2014 a statement giving information regarding EnergyConservation Technology Absorption and Foreign Exchange earnings and out go is given inAnnexure-D' forming part of this Annual Report.
DEMATERIALISATION AND ELECTRONIC REGISTRAR
The equity shares of your Company are available for dematerialization with both NSDLand CDSL under ISIN INE060J01017. As on 31st March 2019 95.48% equity shareswere in demat form and remaining 4.52% equity shares were in physical form.
Our registrar for electronic connectivity with the National Securities DepositoryLimited (NSDL) and Central Depository Services Limited (CDSL) is LinkIntime India PrivateLimited Mumbai.
HUMAN RESOURCE MANAGEMENT & INDUSTRIAL RELATION
Human Resource plays vital role in the Company. If finance is the blood of anyorganization then Human Resource is not less than pulse which keeps running production bytheir hard work day and night. Company focuses on creating best health and safetystandards and also has performance management process to motivate people to give theirbest output and encourages innovation and meritocracy.
Personnel relation with all employees remained cordial and harmonious at all levelsthroughout the year. Directors wish to place on record their sincere appreciations for thecontinued sincere and devoted services rendered by all the employees of the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 ('Act') and Rules made thereunder the Company hasInternal Complaints Committees (ICC) who inquire into complaints of sexual harassment andrecommend appropriate action.
During the year under review no compliant was received from any employee of theCompany and hence no complaint was outstanding as on 31st March 2019.
EXTRACT OFANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexture E' tothis report.
NAME CHANGE OF THE COMPANY
During the year under review the name of the Company has been changed from"Flexituff International Limited" to Flexituff Ventures InternationalLimited" w.e.f. 28th September 2018.
Under review the name of the Company has been changed from "FlexituffInternational Limited" to Flexituff Ventures International Limited" w.e.f. 28thSeptember 2018.
MATERIAL CHANGES AFFECTING THE COMPANY
As on 31st March 2019 the Company has defaulted in repayment of dues asmentioned below:-
|Particular ||Amount of default in Rs. Millions as at March 312019 ||Period of default from |
|i) Name of the lenders in case of: || || |
|Financial Institution/ NBFC: || || |
|1. KKR India Financial Services Private Limited ||99.90 ||February 28 2019 |
|2. IFCI Limited ||25.00 ||March 15 2019 |
|3. IFCI Venture Capital Funds Ltd. ||7.58 ||February 282019 |
|4. IFCI Venture Capital Funds Ltd. ||7.58 ||March 31 2019 |
|5. International Finance Corporation ||622.54 ||January 31 2019 |
|Bank: || || |
|Central Bank of India ||12.50 ||March 31 2019 |
From the overdue amount of Rs. 152.55 Millions (except IFC) Rs. 144.98 Millions hasbeen paid subsequently and balance Rs. 7.57 Millions is still overdue as on the date ofthis report.
Further the Company is in the process of seeking necessary approval and extension fromIFC and the Reserve Bank of India.
The aforesaid disclosure is a part of explanation to the observations given by theStatutory & Secretarial Auditor in their respective reports.
Directors state that no disclosure or reporting is required in respect of the followingmatters as there were no transactions on these items during the year under review:
Details relating to deposits covered under Chapter V of the Act.
Issue of Sweat Equity Shares to employees of the Company under any scheme
Details pertaining to Employee Stock Options (ESOPs) as no ESOPs wereoutstanding as on 31st March 2019.
Issue of differential shares with voting rights as to dividend voting orotherwise
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.
No fraud has been reported by the Auditors to the Audit Committee or the Board.
The Board takes this opportunity to express its sincere appreciation for the excellentsupport and cooperation received from company's bankers investors customers suppliersstatutory authorities for their consistent support to the Company.
The Directors also sincerely acknowledge the outstanding support and services of theworkers staff and executives of the Company which have together contributed to theefficient operations and management of the Company.
| ||For and on behalf of the Board of Directors of |
| ||Flexituff Ventures International Limited |
| || |
|Anand Khandelwal ||Saurabh Kalani |
|Whole-Time Director ||Whole-Time Director |
|(DIN:07889346) ||(DIN: 00699380 |
|Date: 24.05.2019 || |
|Place: Pithampur || |