(For the Financial Year ended 31st March 2018)
To The Members
Your Directors have pleasure in presenting the Forty-First Annual Report along withAudited Financial Statements of the Company for the financial year ended 31st March 2018.
(Rs in lakhs)
|Particulars ||Year ended 2017-2018 ||Year ended 2016-2017 |
|Total Revenue ||90334.59 ||85772.13 |
|Profit subject to Depreciation & Taxation ||16835.91 ||13731.59 |
|Less: Depreciation net of transfer from Revaluation Reserve ||1534.76 ||1416.36 |
|Profit Before Tax ||15301.15 ||12315.23 |
|Less: Provision for Taxation || || |
|Current Tax ||4338.00 ||3603.70 |
|Deferred Tax ||451.39 ||281.68 |
|Previous year excess / (short) tax provision ||- ||- |
| ||4789.39 ||3885.38 |
|Profit After Tax ||10511.76 ||8429.85 |
2017-2018 THE YEAR UNDER REVIEW:
During the year under review your Company recorded impressive performance maintainingits record of growth and profitability.
Your Company earned revenue of? 903.35 crores for the year ended 31st March 2018 asagainst Rs 857.72 crores of previous year. Domestic Sales amounted to Rs 453.43 croresand the Export Sales amounted to Rs 449.92 crores for the year ended 31st March 2018.
During the year under review your Company achieved the significant milestone ofearning over Rs 100 crores by recording Net Profit after tax of Rs 105.12 crores 24.7%higher than the figure recorded in the previous year.
The operations of your Company are elaborated in the annexed "ManagementDiscussion and Analysis Report".
CHANGE IN NAME OF THE COMPANY:
Pursuant to availability of the name from the Office of the Registrar of CompaniesCentral Registration Centre Ministry of Corporate Affairs New Delhi the Board ofDirectors of the Company approved the change of name of the Company from"Garware-Wall Ropes Limited" to "Garware Technical Fibres Limited" andnecessary amendments to Memorandum of Association and Articles of Association of theCompany subject to approval of the Members.
Accordingly the Company has initiated the process for passing of Special Resolutionthrough Postal Ballot / e- Voting for changing the name of the Company to "GarwareTechnical Fibres Limited" and the same is under process.
Your Directors do not propose to transfer any amount to the General Reserve and retainRs 39630.84 lakhs in the Statement of the Profit and Loss.
Your Directors have recommended a Dividend of Rs 4.50 (45%) per share of Rs 10 eachfor your consideration at ensuing Annual General Meeting of the Company The totalproposed dividend for the year would absorb an amount of Rs 1187.10 lakhs (includingdividend tax of Rs 202.41 lakhs).
In terms of the Ind AS -10 'Events after reporting date' as notified by the Ministry ofCorporate Affairs through amendments to Companies (Accounting Standards) Amendment Rules2016 dated 30th March 2016 the Company has not accounted for proposed dividend asliability as at 31st March 2018.
The Dividend as recommend by the Board of Directors if approved by the Members of theCompany will be paid to the eligible Members within the stipulated time.
During the year under review your Company has not accepted any deposit within themeaning of Sections
73 and 74 of the Companies Act 2013 read with the Companies (Acceptance of Deposits)Rules 2014 (including any statutory modification(s) or re-enactment(s) for the time beingin force).
I CHANGE IN THE NATURE OF BUSINESS IF ANY:
There was no change in the nature of business of your Company during the Financial Yearended 31st March 2018.
I MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION:
No material changes and commitments affecting the financial position of the Companyoccurred between the end of the Financial Year of the Company i.e. 31st March 2018 andthe date of this Directors' Report i.e. 30th May 2018.
I DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 152 of the Companies Act 2013 read with Article96 of the Articles of Association of the Company Ms. Mayuri V. Garware (DIN 06948274) isliable to retire by rotation at the ensuing Annual General Meeting of the Company andbeing eligible offers herself for re-appointment. The Board recommends her reappointment.
In view of the SEBI (Listing Obligations and Disclosure Requirements) (Amendment)Regulations 2018 dated 9th May 2018 which will come into force with effect from 1stApril 2019 no listed entity can continue the directorship of any person as anon-executive director who has attained the age of 75 (seventy-five) years unless aSpecial Resolution is passed to that effect. Accordingly continuation of Mr. R. M.Telang aged 76 (seventy-six) years as Non-Executive Independent Director of the Companywith effect from 1st April 2019 is recommended for approval of Members at the ensuingAnnual General Meeting of the Company as Special Business by way of Special Resolution.
The details of Ms. Mayuri V. Garware and Mr. R. M. Telang as required under the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 and as per SecretarialStandard - 2 of General Meeting are contained in the accompanying Notice callingForty-First Annual General Meeting of the Company which forms an integral part of thisReport.
Pursuant to the provisions of Section 203 of the Companies Act 2013 Mr. V. R.Garware Chairman & Managing Director Mr. S. H. Bamne Chief Financial Officer andMr. Sunil Agarwal Company Secretary and Compliance Officer are discharging the functionsand responsibilities of whole-time Key Managerial Personnel of the Company.
During the Financial Year 2017-18 there has been no change in the Key ManagerialPersonnel of the Company.
DECLARATION BY INDEPENDENT DIRECTORS':
The Company has received declarations from all the Independent Directors confirmingthat they are meeting the criteria of independence as provided in sub-section (6) ofSection 149 of the Companies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT:
Your Directors to the best of their knowledge and belief and according to theinformation and explanations obtained by them and pursuant to the provisions of Section134(3)(c) of the Companies Act 2013 read with Section 134(5) of the Companies Act 2013hereby state and confirm that:
1. In the preparation of the Annual Financial Statements for the year ended 31st March2018 the applicable Accounting Standards have been followed;
2. For the Financial Year ended 31st March 2018 such Accounting Policies as mentionedin the Notes to the Financial Statements have been applied consistently and judgments andestimates that are reasonable and prudent have been made so as to give a true and fairview of the state of affairs of the Company and of the Profit and Loss of the Company forthe year ended 31st March 2018;
3. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities in accordance with the provisions of the Companies Act 2013;
4. The Annual Financial Statements have been prepared on a "Going Concern"basis;
5. Proper Internal Financial Controls were followed by the Company and that suchInternal Financial Controls are adequate and were operating effectively; and
6. Proper systems to ensure compliance with the provisions of all applicable laws werein place and that such systems were adequate and operating effectively.
ANNUAL EVALUATION BY THE BOARD:
In view of the provisions of the Companies Act 2013 and considering the Guidance Notedated 5th January 2017 issued by the Securities and Exchange Board of India("SEBI") the Nomination & Remuneration Committee of the Board has laid downcomprehensive framework including the criteria for evaluation of performance of the Boardas a whole and various committees of the Board and individual Directors includingIndependent Directors.
Based on such comprehensive framework the Board of Directors of the Company hadcarried out Annual Evaluation of the performance of the Board as a whole the Directorsindividually and also the working of its Audit Committee Nomination & RemunerationCommittee Corporate Social Responsibility Committee and Stakeholder RelationshipCommittee.
On collation of all the responses feedback was provided by Chairman of the Board toeach member of the Board.
The Board noted the evaluation results that were collated and presented to the Board.
The Directors expressed their satisfaction with the evaluation process.
A separate meeting of Independent Directors was held on Tuesday 13th February 2018inter alia to:
i. Review the performance of Non-Independent Directors and the Board as a whole;
ii. Review the performance of the Chairperson of the Company taking into account theviews of Executive Director and Non-Executive Directors;
iii. Assess the quality quantity and timeliness of flow of information between theCompany management and the Board that was deemed necessary for the Board to effectivelyand reasonably perform their duties.
NUMBER OF MEETINGS OF THE BOARD:
There were four (04) meetings of the Board of Directors held during the year detailsof which are given in the annexed "Corporate Governance Report".
COMPOSITION OF THE COMMITTEES OF THE BOARD:
The details relating to the composition of Audit Committee Nomination and RemunerationCommittee Corporate Social Responsibility Committee and Stakeholders RelationshipCommittee are given in the annexed "Corporate Governance Report".
Pursuant to the provisions of Section 139142 and other applicable provisions if anyof the Companies Act 2013 read with the Companies (Audit and Auditors) Rules 2014 andpursuant to the recommendation of the Audit Committee M/s Mehta Chokshi & ShahChartered Accountants (Firm Registration No. 106201W) were appointed as StatutoryAuditors at the 40th Annual General Meeting to hold office from the conclusion of 40thAnnual General Meeting till the conclusion of 45th Annual General Meeting of the Companysubject to ratification of their appointment at every Annual General Meeting.
However pursuant to the provisions of the Companies (Amendment) Act 2017 effectivefrom 7th May 2018 the requirement of seeking approval for ratification of appointment ofStatutory Auditors by Members of the Company at every Annual General Meeting is omitted.
Therefore the Company is not seeking any ratification of appointment of M/s. MehtaChokshi & Shah Chartered Accountants as the Statutory Auditors of the Company by theMembers at the ensuing Annual General Meeting.
STATUTORY AUDITORS' AND REPORT:
There are no audit qualifications reservations or adverse remarks or disclaimers inthe Auditors' Report as annexed elsewhere in this Annual Report.
COST AUDIT AND COST COMPLIANCE:
In accordance with the provisions of Companies (Cost Records and Audit) Rules 2014 asamended from time to time Cost Audit for the Financial Year 2017-18 was applicable tothe Company. M/s. Joshi Apte & Associates Cost Accountants (Firm Registration No.000240) were appointed as Cost Auditor for conducting audit of Cost Accounting Recordsmaintained by the Company for the Financial Year 2017-18.
The Audit Report for the Cost Accounting records maintained by the Company for theFinancial Year 2017- 18 is under preparation and the same will be filed with the CentralGovernment within the prescribed time limit.
M/s. Joshi Apte & Associates Cost Accountants (Firm Registration No. 000240)were re-appointed as Cost Auditor for conducting an audit of Cost Accounting Recordsmaintained by the Company for the Financial Year 2018-19.
SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors of the Company had appointed M/s. SVD & Associates CompanySecretaries (CP No. 965) as Secretarial Auditor for the year ended 31st March 2018.
The Secretarial Auditor has submitted its Report in Form No. MR-3 for the FinancialYear ended on 31st March 2018 and the same is set out in "Annexure 1" formingan integral part of the Directors' Report. The observation of the secretarial auditors intheir report are self-explanatory and therefore the directors do not have any furthercomments to offer on the same.
M/s. SVD & Associates Company Secretaries (CP No. 965) were appointed asSecretarial Auditors to carry out the audit of the Secretarial and related records of theCompany for the Financial Year ended on 31st March 2019.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The Company has not provided any Guarantee during the Financial Year 2017-18attracting the provisions of Section 186 of the Companies Act 2013 read with theCompanies (Meetings of Board and its Powers) Rules 2014.
Details of loans given and investments made during the Financial Year 2017-18 underthe provisions of Section 186 of the Companies Act 2013 read with the Companies(Meetings of Board and its Powers) Rules 2014 are given in the notes to FinancialStatements.
RELATED PARTY TRANSACTIONS:
All the transactions with Related Parties entered during the Financial Year 2017-18 bythe Company were in the ordinary course of business and on arm's length basis and thatthe provisions of Section 188 of the Companies Act 2013 and the Rules made thereunder arenot attracted.
There were no Material Related Party Transaction(s) made with the Related Party as perRegulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
All Related Party Transactions were placed before the Audit Committee for their priorapproval. Omnibus approval was obtained on a yearly basis for transactions which were ofrepetitive nature. The Policy on Related Party Transactions as approved by the Board isuploaded on the Company's website: http://www. garwareropes.com/oartv-transactions-policv.html.
Pursuant to the provisions of Section 134(3)(h) of the Companies Act 2013 Form AOC-2is not applicable to the Company.
ADEQUACY OF INTERNAL FINANCIAL CONTROL:
Your Company continued to remain focused on ensuring a robust and effective InternalFinancial Control framework.
Internal Financial Controls laid down by your Company with reference to the FinancialStatements are adequate operating effectively and commensurate to the size scale ofoperations and nature of business of the Company.
The Board of Directors of the Company has approved the Policy relating to remunerationfor the Directors Key Managerial Personnel Senior Management based on recommendation ofNomination & Remuneration Committee of the Board.
The salient aspects covered in the Policy have been outlined in the CorporateGovernance Report which forms an integral part of this Report.
As per the requirements of Section 178(4) of the Companies Act 2013 details of such aPolicy have been displayed on the Company's website: http:// www.garwareroDes.com/remuneration.html.
RISK MANAGEMENT POLICY:
The Company recognizes the importance of Risk Management and hence the Board ofDirectors of the Company has adopted Risk Assessment and Minimization Policy Statement.This Policy Framework has been adopted as a fundamental part of the business policy tocounter and combat the adverse consequential effects of various risks.
Risk Management involves the following:
Identification of risks.
Evaluation of the risks as to likelihood and consequences.
Assessment of options for minimising / covering the risks.
Preparation of Risk Management Plan.
Action Plan for the implementation of the Risk Management Plans.
Review of the Risk Management efforts.
The Board of Directors of the Company regularly review the risk and initiatives takenwithin framework of Risk Assessment and Minimization Policy Statement and accordinglytake necessary corrective actions if required for managing/mitigating the same.
The Board of Directors of the Company has formulated a Vigil Mechanism Policy which isin compliance with the provisions of Section 177(10) of the Companies Act 2013 andRegulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 details of which are given in the annexed "Corporate Governance Report".
CORPORATE SOCIAL RESPONSIBILITY (CSR):
Pursuant to the provisions of Section 135 of the Companies Act 2013 read with theCompanies (Corporate Social Responsibility) Rules 2014 your Company has establishedCorporate Social Responsibility (CSR) Committee and an Annual Report on CSR Activitiesforming an integral part of the Directors' Report is set out in "Annexure 2".
THE CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGO:
Information in accordance with the provisions of Section 134(3)(m) of the CompaniesAct 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 pertaining to theConservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo is setout in "Annexure 3" forming an integral part of the Directors' Report.
EXTRACT OF ANNUAL RETURN:
Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Companies Act 2013read with Rule 12 of the Companies (Management & Administration) Rules 2014 anextract of Annual Return as of 31st March 2018 in Form No. MGT-9 is set out in"Annexure 4" forming an integral part of the Directors' Report.
The relations with employees at all levels continued to be cordial throughout the year.
PARTICULARS OF EMPLOYEES:
The information required pursuant to the provisions of Section 197 of the CompaniesAct 2013 read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is set out in "Annexure 5" forming an integral part ofthe Directors' Report.
DETAILS OF EMPLOYEE WELFARE TRUST SET UP FOR THE BENEFIT OF EMPLOYEES:
Your Company on 16th October 2006 constituted a Trust named as "GWRL ManagerialStaff Welfare Trust" to implement the Welfare Scheme for the benefit of itsManagerial Employees. The said Scheme is in compliance of the provisions of the Securitiesand Exchange Board of India (Share Based Employee Benefit) Regulations 2014.
The Details as required by Regulation 14 of the Securities and Exchange Board of India(Share Based Employee Benefit) Regulations 2014 are uploaded on the Company's website: http://www.garwareropes.com/stock-exchange.html .
THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013 ("the Sexual Harassment Act"):
Your Company has zero tolerance towards any action on the part of any employee whichmay fall under the ambit of "Sexual Harassment" at workplace and is fullycommitted to uphold and maintain the dignity of every woman employee working in theCompany.
Your Company has adopted a Policy under the Sexual Harassment Act and Rules framedthereunder.
During the Financial Year 2017-18 there was one (01) complaint received to theCommittee constituted under the Sexual Harassment Act which has been resolved.
CONSOLIDATED FINANCIAL STATEMENTS:
Pursuant to the provisions of Section 129 of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 and applicable Accounting Standards the Company hasprepared a Consolidated Financial Statement of the Company its Subsidiary and AssociateCompany in the same form and manner as that of the Company which shall be laid before theensuing Annual General Meeting of the Company along with the laying of the Company'sStandalone Financial Statement.
The Annual Report of the Company inter alia contains the Audited Financial Statement ofthe Company and Consolidated Audited Financial Statement of the Company and its Subsidiaryand Associate Company.
Pursuant to the provisions of Section 13 6 of the Companies Act 2013 the AuditedFinancial Statements of the Company Consolidated Financial Statements along with relevantdocuments and separate Audited Financial Statements in respect of its Subsidiary andAssociate Company are also uploaded on the Company's website: http://www.garwareropes.com/financial-reports.html.
The Audited Financial Statements of the Subsidiary Associate Company and the relateddetailed information will be made available to any Member of the Company / its Subsidiaryand Associate Company who may be interested in obtaining the same. The Audited FinancialStatements of the Subsidiary and Associate Company will also be kept for inspection by anyMember at the Company's Registered Office and that of the Subsidiary and AssociateCompanies.
SUBSIDIARY AND ASSOCIATE:
Garware Environmental Services Private Limited is the wholly owned subsidiary of yourCompany. This Subsidiary Company is yet to start its commercial operations.
Garware Meditech Private Limited is an associate of your Company and presently nothaving any business activity.
Pursuant to provisions of first proviso of sub-section (3) of Section 129 of theCompanies Act 2013 a Statement containing salient features of the Financial Statement ofits Subsidiary and Associate Company in Form No. AOC-1 is attached to the FinancialStatement.
Pursuant to Regulation 34 read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements)
Regulations 2015 a separate section on Corporate Governance as well as the Auditor'sCertificate regarding compliance of conditions of Corporate Governance is set out in"Annexure" which forms an integral part of the Directors' Report.
The Report on Corporate Governance also contains certain disclosures required under theCompanies Act 2013.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There are no significant and material orders passed by Regulators / Courts / Tribunalsthat would impact the going concern status of the Company and its future operations.
The Institute of Company Secretaries of India had revised the Secretarial Standards onMeetings of the Board of Directors (SS-1) and Secretarial Standards on General Meetings(SS-2) with effect from 1st October 2017. The Company is in compliance with the revisedSecretarial Standards.
Your Directors gratefully acknowledge the support given by the Customers DealersDistributors Suppliers Bankers various departments of the Central and StateGovernments Local Authorities and also the Members of the Company.
Your Directors would further like to record their appreciation for the unstintedefforts put in by all Employees of your Company during the year.
On behalf of the Board of Directors V. R. GARWARE
Pune Chairman & Managing Director
30th May 2018 DIN 00092201