The Members of GINI SILK MILLS LIMITED
Your Directors have pleasure in presenting their 39th Annual Report on the business andoperations of the Company together with the Audited Statement of Accounts for the yearended March 31 2019.
1. FINANCIAL HIGHLIGHTS:
The Board's Report is prepared based on the stand alone financial statements of theCompany.
| || ||(Rs. in Lakhs) |
|Particulars ||2018-2019 ||2017-2018 |
|1. REVENUE || || |
|Net Sales/ Income from operation ||3661.99 ||3942.55 |
|Other Income ||191.39 ||167.65 |
|Total ||3853.39 ||4110.20 |
|2. LESS: EXPENDITURE || || |
|Cost of Materials Consumed ||891.16 ||1306.15 |
|Purchases of Traded Goods ||299.26 ||197.17 |
|(Increase)/ decrease in inventories of finished goods and Stock in Process ||25.84 ||116.05 |
|Employee Benefit Expenses ||442.46 ||408.96 |
|Financial Cost ||51.05 ||89.92 |
|Depreciation and Amortization Expense ||102.03 ||97.60 |
|Other Expenses ||1915.17 ||1610.31 |
|Total ||3726.97 ||3826.16 |
|3. PROFIT BEFORE TAX ||126.42 ||286.94 |
|4. Provision for Taxation || || |
|i) Current Tax ||58.26 ||75.88 |
|ii) Deferred Tax ||5.25 ||(3.61) |
|iii) (Excess)/ Short provisions written back of earlier years ||(43.94) ||- |
|5. PROFIT AFTER TAX ||106.84 ||214.67 |
|6. Balance carried from Previous Year ||2831.13 ||2651.90 |
|7. OTHER COMPREHENSIVE INCOME FOR THE YEAR ||4.51 ||(1.78) |
|8. Amount Available for Appropriation ||2942.48 ||2864.79 |
|9. BALANCE CARRIED to BALANCE SHEET ||2908.67 ||2831.13 |
|10. Basic/ Diluted Earnings per Equity Shares ||1.91 ||3.84 |
Your Directors recommended a dividend of 5% i.e. Rs. 0.50 per Equity Shares of facevalue of Rs. 10/- each aggregating to Rs. 27.96 Lakhs (previous Year Rs. 27.96 Lakhs)(excluding Dividend Distribution Tax as applicable) for the year ended on March 31 2019.
No amount out of current year's Profits is transferred to the Reserves and surplus.
Our Revenue from operations during the period under review was Rs. 3661.99 Lakhs andRs. 3942.55 Lakhs in the previous year.
During the period under review the profit after tax (PAT) stood at 106.84 Lakhs(Previous Year Rs. 214.67Lakhs). There is a decrease of 50.23% in net profit after tax ascompared to previous year. The decrease in the Net Profit is due to Provision made forDoubtful Debts of Rs. 126.04 Lakhs. The performance for the coming years is expected toimprove upon from the last year if right macroeconomic indicators are achieved in future.
5. DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors' confirm that
(a) in the preparation of the Annual Accounts the applicable Accounting Standards hadbeen followed along with proper explanation relating to material departures;
(b) the Directors had 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 Profit and Loss of the Company for that
(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the Annual Accounts on a going concern basis; and
(e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
6. Extract of annual return:
The details forming part of the extract of the Annual Report in form MGT-9 as requiredunder Section 92(3) of the Companies Act 2013 read with rule 12(1) of the Companies(Management and Administration ) Rules 2014 are included in this Report as annexure-iand forms an integral part of this report.
7. Particulars of contracts or arrangements with related parties
The particulars of every contract or arrangements entered into by the Company withRelated Parties referred to in subsection (1) of section 188 of the Companies Act 2013including certain arm's length transactions under third proviso thereto is disclosed inForm No. AOC-2 as ANNEXURE II.
8. DIRECTORS OR KEY MANAGERIAL PERSONNEL APPOINTMENTS / RESIGNATIONS DURING THEYEAR:
During the year under review Mr. Prasad Anant Nagvekar was appointed as the ChiefFinancial Officer of the Company w.e.f January 07 2019.
9. (1) PARTICULARS OF EMPLOYEES:
|Particulars ||Remarks |
|1. The ratio of the Remuneration of each Director to the median ||a) Mr. Vishwanath Harlalka Executive Chairman- 9.89:1 |
|Remuneration of the Employees of the Company for the financial year. || |
| ||b) Mr. Deepak Harlalka Managing Director-9.89:1 |
|2. The percentage increase in the Remuneration of each Director Chief Financial Officer Chief Executive Officer ||a) Mr. VishwanathHarlalka- Nil |
|b) Mr. Deepak Harlalka- Nil Company Secretary or Manager if any in the financial year || |
|3. The percentage increase in the median Remuneration of ||6.35% |
|Employees in the financial year || |
|4. The number of permanent Employees on the rolls of Company ||132 |
|5. Average percentile increase already made in the salaries of Employees other than Managerial personnel in the last financial year and its comparison with the percentile increase in the Managerial Remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the Managerial Remuneration. ||There has been no increase in the salaries of the employees other than managerial personnel in the last financial year |
|6. Affirmation that the Remuneration is as per the Remuneration It is hereby affirmed that the Remuneration policy of the Company. is as per the Remuneration policy of the Company. || |
(2) Particulars of Employees drawing Remuneration in excess of limits prescribedunder Section 134(3)(q) read with Rule 5 of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 : There are no Employees drawing Remuneration exceedingRupees One crore and two Lakhs per annum if employed throughout the financial year orRupees Eight Lakh and Fifty Thousand per month if employed for part of the financial yearor draws Remuneration in excess of managing Director or Whole time Director or Manager andholds by himself or along with his spouse and dependent children not less than twopercent of the equity shares of the Company.
10. Number of meetings of board during the year:
|Particulars ||No. Of meetings held |
|1. Board meetings ||Six |
|2. Audit Committee meetings ||Four |
|3. Nomination and Remuneration Committee meeting ||One |
|4. Independent Directors Meeting ||One |
11. Formal annual evaluation:
Pursuant to the applicable provisions of the Act and the Listing Regulations the Boardhas carried out an annual evaluation of its own performance and working of its Committees.The Board's functioning was evaluated on various aspects including inter alia degree offulfillment of key responsibilities its structure and composition establishment anddelegation of responsibilities to various Committees. Directors were evaluated on aspectssuch as attendance and contribution at Board/ Committee Meetings and guidance/ support tothe management of the Company. Areas on which the Committees of key responsibilitiesadequacy of Committee composition and of the Board were assessed included degree offulfillment effectiveness of meetings.
The performance evaluation of the Independent Directors was carried out by the entireBoard excluding the Director being evaluated. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Board as a whole.
12. Declaration By an independent director:
Declarations by the Independent Directors that they meet the criteria of independenceas provided in sub-section (6) of
Section 149 of the Companies Act 2013 has been received by the Company.
13. Remuneration policy:
The Board of Directors has framed a policy which lays down a framework in relationto Remuneration of Directors Key Managerial Personnel and Senior Management of theCompany. The Remuneration policy is also uploaded on the website www.ginitex.com
14. Statutory auditors:
At the Annual General Meeting held on August 29 2017 M/s. Bilimoria Mehta & Co..Chartered Accountants (FRN
101490W) Mumbai were appointed as statutory auditors of the Company to hold officetill the conclusion of the Annual
General Meeting to be held in the year 2022.
The report given by the auditors on the financial statement of the Company is a part ofthe Annual Report. There has been no qualification reservation adverse remarks ordisclaimer given by the auditors in their report.
15. SECRETARIAL AUDIT REPORT:
In terms of Section 204 of the Companies Act 2013 and Rules made there under M/s.Sandeep Dar and Co. Practicing Company Secretaries have been appointed as SecretarialAuditor of the Company. The report of the Secretarial Auditor is enclosed as annexureiii to this report. The report is self-explanatory however the Company has initiatednecessary steps to comply with various non-compliances as mentioned under the SecretarialAudit Report.
16. Vigil mechanism/ whistle blower policy:
The Company has a Whistle Blower Policy to report genuine concerns or grievances. TheWhistle Blower Policy has been posted on the website of the Company at www.ginitex.com
17. Composition of audit committee:
Composition of Audit Committee as on March 31 2019 as required under section 177(8) ofthe Companies Act 2013 read with Regulation 18 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
1. Mr. Suresh Gaggar - Chairman
2. Mr. Pankajkumar Agarwal - Member
3. Mr. Ruchir Jalan - Member
18. Significant material changes
There were no material changes and commitments which adversely affects the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financial statements relate and the date of the report.
19. Risk management
The Company is reviewing its Risk perception from time to time taking into accountsoverall business environment affecting/ threatening the existence of the Company.Presently management is of the opinion that such existence of risk is minimal.
20. Details in respect of adequacy of internal financial controls with reference To thefinancial statements.
The Company has in place adequate internal financial controls. During the year suchcontrols were tested and no reportable material weakness in the design or operation wasobserved.
During the year under review the Company has not accepted any deposits within themeaning of Section 73 of Companies
Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.
22. Particulars of loans guarantees or investments under section 186 of thecompanies act 2013
During the period under review Company has not given any loans guarantees orinvestments to the Company.
23. Corporate governance:
Your Company believes that Corporate Governance is a code of self discipline. In theline with this policy the Board of Directors strongly believes that it is very importantthat the Company follows healthy Corporate Governance practices and reports to theshareholders the progress made on the various measures undertaken.
A report certificate from the Statutory Auditors on compliance with Corporate onCorporate Governance along with
Governance norms forms an integral part of this report.
24. Management discussion and analysis
i industry Structure and Developments
Indian Textile industry is one of the largest in the world with large raw material baseand manufacturing strength across the value chain. The uniqueness of the industry lies inits strength both in the hand woven as well as in the capital intensive mill sector.Traditional sectors like handloom handicrafts and small scale power-loom units are thebiggest source of employment for millions of people in rural and urban area.
ii opportunities and Challenges
1. Shift towards the market of branded ready- made garments is being observed
2. Increase Disposable Income and Purchasing Power of Indian Customer opens NewMarket .
3. More number of emerging malls and retail industries are providing opportunitiesto industries segments like handicrafts and apparels
In textiles our product is well very accepted by our customers & we are in theprocess of increasing our customer portfolio.
Your Company's future growth will be driven by multiple growth driver. In thetextile space large opportunities in global textile and clothing markets are drivinggrowth for us. Your Company will focus on its core strengths product segments.
Its focus on building marketing & distribution foot-prints shall continue withrenewed vigor during the coming year. On the whole we are seeing new growth opportunitiesin advanced material division and the segment continues to grow at rapid pace.
V risk and Concerns:
The Company has risk management framework which enable it to take certain risks toremain competitive and achieve higher growth and at the same time mitigate other risks tomaintain sustainable results. A key factor in determining a Company's capacity to createsustainable value is the risk that the Company is willing to take and its ability tomanage them effectively. The Company's Risk Management processes focuses on ensuring thatrisks are identified on a timely basis and addressed.
Foreseeing the concerns the Company manages to identify evaluate and monitornon-business risks.
Vi internal Control Systems and their adequacy:
The existing internal controls are adequate and commensurate with the nature sizecomplexity of the Business and its Processes. During the year the Company has laid downthe framework for ensuring adequate internal controls and to ensure its effectivenessnecessary steps were taken by the Company.
VII. Discussion on financial performance with respect to Operational Performance
During the year under review your Company has registered a turnover of 3661.99Lakhs as compared to 3942.55 Lakhs in the previous year. The sales revenue from Processingof Fabric increased from Rs. 2378.69 Lakhs to Rs. 2638.74 Lakhs during the year underreview.
Viii. Material developments in human resources/ industrial relations front includingnumber of people employed
Your Company believes that its employees are one of the most valuable assets of theCompany. The employees are deeply committed to the growth of the Company. With the growingrequirements of the Company Company has taken necessary initiatives to ensure not onlythe retention of the employees but also their growth and development. The Company alsoprovides various opportunities to the employees to develop their skills to take up higherresponsibilities in the organization. Company also uses various communication channels toseek employee's feedback about the overall working environment and the necessary tools andresources they need to perform at their best potential.
25. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
Company has adopted a policy for prevention of Sexual Harassment of Women at workplaceand has set up Internal Complaints Committee under the Act for implementation of saidpolicy. The following is a summary of sexual harassment complaint received or dispose ofduring the year 2018-19:
No. of Complaint received: NIL
No. of Complaint disposed off: NIL.
26. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO PURSUANT TO PROVISIONS OF SECTION 134 OF THE COMPANIES ACT 2013 READ WITH RULE 8(3) OF COMPANIES (ACCOUNTS) RULES 2014.
A) CONSERVATION OF ENERGY:
(i) The steps taken or impact on conservation of energy - Energy conservation continuesto receive priority attention at all levels by regular monitoring of all equipments anddevices which consume electricity.
(ii) The steps taken by the Company for utilizing alternate sources of energy - Companyensures that the manufacturing operations are conducted in the manner whereby optimumutilization and maximum possible savings of energy is achieved.
(ii) The capital investment on energy conservation equipments Since Company is havingadequate equipment; no capital investment on energy conservation equipments is made duringthe year.
B) TECHNOLOGY ABSORPTION:
(i) The efforts made towards technology absorption - Not Applicable
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution - Not
(iii) In the case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year) - Not Applicable.
(a) The details of technology imported - Not Applicable (b) The year of import - NotApplicable (c) Whether the technology been fully absorbed - Not Applicable
(d) If not fully absorbed areas where absorption has not taken place and the reasonsthereof - Not Applicable (iv) The expenditure incurred on Research and Development Atpresent the Company does not have separate division for carrying out research anddevelopment work. No expenditure has therefore been earmarked for this activity.
C) FOREIGN EXCHANGE EARNINGS AND OUTGO
There were no foreign exchange earnings and outgo during the year under review.
27. Details of significant and material orders passed By the regulators or courts ortribunals imp acting the going concern status and company's operations in future bythe Regulatrs/ Court which would impact the going concern status There are no significantof the Company and its future operations.
We record our gratitude to the Banks and others for their assistance andco-operation during the year. We also wish to place on record our appreciation for thededicated services of the employees of the Company. We are equally thankful to ouresteemed investors for their co-operation extended to and confidence reposed in themanagement.
BYOR DER OF THE BOARD FOR GINI SILK MILLS LIMITED
VISHWANATH HARLALKA CHAIRMAN
413 Tantia Jogani Industrial Estate Premises Opp. Kasturba HospitalJ. R.BorichaMarg
Lower Parel (East)Mumbai-400011
Date: May 30 2019 Place: Mumbai