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Hardcastle & Waud Mfg Co Ltd.

BSE: 509597 Sector: Consumer
NSE: N.A. ISIN Code: INE722D01015
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NSE 05:30 | 01 Jan Hardcastle & Waud Mfg Co Ltd
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VOLUME 1
52-Week high 506.20
52-Week low 250.05
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Buy Price 0.00
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Sell Price 0.00
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OPEN 311.00
CLOSE 311.00
VOLUME 1
52-Week high 506.20
52-Week low 250.05
P/E
Mkt Cap.(Rs cr) 21
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Hardcastle & Waud Mfg Co Ltd. (HARDCASTWAUD) - Director Report

Company director report

Your Directors have pleasure in placing before you their Seventyfirst Annual Reporttogether with the Audited Financial Statements for the year ended March 31 2017 andManagement Discussion and Analysis.

1. FINANCIAL RESULTS AND APPROPRIATIONS :

Year Ended Previous Year
March 31 2017 March 31 2016
(' Lacs) (' Lacs)
Profit before Interest Depreciation & Exceptional Items 51.03 199.11
Interest 0.02 0.01
Depreciation etc. 32.52 33.05
Profit before Taxation and Past MAT entitlement lapsed ' Nil (Prev. Year ' 42.89 Lacs) 18.49 166.05
Prior Year Adjustments 1.00 0.09
Provision for Taxation (4.47) 60.32
Deferred Tax (0.29) 1085.05
Net Profit/(Loss) after Taxation 22.25 (979.41)
Balance b/f from Previous Year (979.31) 0.10
Total Available (957.06) (979.31)
Transferred to General Reserve - -
Carried forward (957.06) (979.31)

In view of absence of divisible surplus no dividend is being recommended.

2. OPERATIONS:

The Company registered a turnover of Rs 388.00 lacs this year as against Rs 611.99 lacsduring the previous year. The significant decline of 36.60% is attributed to suspension ofmanufacturing activities at the Company's factory due to lack of orders coupled withdiscontinuance of job work relating to industrial chemicals undertaken on behalf of thirdparty. The Company has however recorded a profit of Rs 22.24 lacs as against a loss of Rs979.41 lacs last year. This has been possible due to significant drop in deferred tax.

Due to disturbances in business circles following introduction of GST it is difficultto make a prediction about the future. Your directors are however cautiously optimistic.

3. MANAGEMENT DISCUSSION AND ANALYSIS:

The Company's current business activity consists of three segments viz IndustrialChemicals Investments and Leasing. During the year under review revenue from industrialsegment was lower at Rs 242.72 lacs compared to Rs 505.72 lacs in the previous yearrevenue from investments was Rs 19. 91 lacs in comparison to Rs 3.89 lacs in the previousyear while leasing activities recorded a revenue of Rs 125.36 lacs as compared to Rs102.39 lacs last year.

To overcome various challenges in a highly competitive business environment theCompany has taken various initiatives to reduce operational costs to achieve bettermargins across various segments.

GST even though may prove to be beneficial in the long run has temporarily affectedtrade and business sentiment which is perceived to be a negative factor.

The Company has in place a well established internal financial control systems in allareas of its operations to ensure proper recording of financial and operationalinformation and compliance of various internal controls and other regulatory and statutorycompliances. In addition to statutory audit the internal auditors monitor and evaluatethe efficacy and adequacy of internal control systems in the Company. Based on reports ofthe internal auditor respective departments undertake corrective action in theirrespective areas and thereby strengthen the controls. Significant audit observations andcorrective actions thereon are presented to the Audit Committee of the Board.

Information pertaining to financial performance forms part of this Report.

There were no material developments in the Company's Human Resource Capital. Industrialrelations continue to be stable.

4. DIRECTORS:

a) Your directors regret to report about the passing away of Hasmukh Gandhi anindependent director of the Company on 24.5.2017. The directors place on record theirappreciation of the valuable service rendered by Hasmukh Gandhi during his longassociation with the Company.

b) At the 70th Annual General Meeting (AGM) held on 30.09.2016 Mrs Smita Jatia (DIN:03165703) was re-appointed as a director of the Company. Mr Sunil Trivedi (DIN: 00387797)and Mrs Rekha Pacheria (DIN: 07415573) were also appointed as Independent Directors whileMr Banwari Lal Jatia (DIN: 00016823) was reappointed for a period of three years w.e.f1.4.2017.

c) On recommendation of the Nomination and Remuneration Committee of the Company MrGovind Prasad Goyal (DIN: 00017294) was appointed as additional director of the Companyw.e.f 4.9.2017 in the category of independent director. Pursuant to Section 150 (2) ofthe Act the appointment of Mr Goyal needs to be approved by members.

The appointee possesses requisite expertise and knowledge and is qualified for being anIndependent Director of the Company. The Company has also received prescribed notice froma member along with requisite security deposit.

Approval of members is being sought for appointment of Mr Goyal for a term of fiveyears w.e.f 4.9.2017.

Necessary declarations have been received from each independent director under Section149(7) of the Act that he / she meets the criteria of independence laid down in Section149 (6) of the Act.

d) Mr Om Prakash Adukia (DIN: 00017001) retires by rotation at the ensuing AGM butbeing eligible offers himself for re-appointment.

e) Board Evaluation:

The Board has carried out an annual evaluation of its own performance as also of theindividual directors and its various committees. The performance of Non-IndependentDirectors and the Board as a whole was carried out by the Independent Directors at theirseparate meeting. Evaluation of performance of Independent Directors was carried out bythe entire Board of Directors excluding the director being evaluated. The directorsexpressed satisfaction with the evaluation process and the results.

f) Meetings:

During the year 6 board meetings were convened and held.

5. COMMITTEES OF BOARD:

i) Audit Committee:

The Audit Committee comprises of:

Mr Sunil Trivedi (Chairman)

Ms Rekha Pacheria Mr Om Prakash Adukia

During the year there were no instances where the Board did not accept anyrecommendation of the Audit Committee. The Company has also put in place a vigil mechanismfor directors and employees to report their concerns / grievances etc. to the AuditCommittee which oversees the functioning of the said mechanism.

ii) Nomination and Remuneration Committee (NRC):

The NRC comprises of three members of which two including the Chairman are IndependentDirectors.

The Company's policy on appointment and remuneration of directors and others etc. isattached as ‘Annexure I' to this report.

iii) Risk Management

In the Board's perception there are no foreseeable risks which could threaten theexistance of the Company except disturbances caused by government actions and politicaldevelopment.

6. UNCLAIMED SHARE CERTIFICATES:

As reported last year the Company had in accordance with the listing regulationstransferred on 27.5.2016 to a separate demat account in the Company's name 9778 unclaimedshares of the Company belonging to 79 shareholders who had failed to exchange their oldcertificates for new certificates in the Company allotted to members pursuant to a Schemeof Arrangement between the Company and Vesna Agencies Pvt Ltd (Hawcoplast Chemicals Ltd)even after many reminders by the Company. During the year one such member has sinceclaimed his entitlement. The number of shareholders and the outstanding shares lying inthe suspense account as at 31.3.2017 thus stands at 78 and 9650 respectively.

The voting rights however on these unclaimed shares will remain frozen till therightful owner(s) claim(s) the shares.

Members who have not yet collected / claimed their share certificates can still do sothrough the Company's Registrars and Share Transfer Agent.

7. AUDITORS:

M/s GMJ & Co. Chartered Accountants were appointed as Statutory Auditors of theCompany at the AGM held on 30.9.2014 for a period of five years subject to ratification bymembers at every subsequent AGM. Ratification of the appointment is therefore being soughtfrom members.

The Company has obtained a certificate from M/s GMJ & Co. to the effect that theirre-appointment if made would be in accordance with the Act and the Rules framedthereunder.

8. AUDITORS' REPORT:

The Auditors' Report does not contain any reservation qualification or adverse remark.

9. SECRETARIAL AUDIT:

A Secretarial Audit Report for the financial year ended 31st March 2017 is annexedhereto as ‘Annexure II'.

The Secretarial Audit Report does not contain any qualification reservation or adverseremark.

10. LOANS / INVESTMENTS:

Details of loans and investments appear in the notes to the financial statements. Noguarantees / securities were provided by the Company on behalf of other bodies corporateduring the year.

11. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

All contracts / arrangements / transactions entered into by the Company during thefinancial year with related parties were in the ordinary course of business and on arm'slength basis. During the year the Company did not enter into such materially significanttransactions that may have potential conflict with the interest of the Company.

12. FOREIGN EXCHANGE OUTGO:

The Company expended Rs 3.91 lacs in foreign exchange during the year.

13. CORPORATE SOCIAL REPONSIBILITY (CSR):

None of the three criteria specified in Section 135(1) of the Act relating to CSR isapplicable to the Company.

14. subsidiary; joint venture or associate companies:

The Company has no subsidiary joint venture or associate.

15. PARTICULARS OF EMPLOYEES:

a. Required particulars of employees under Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are attached as ‘Annexure - III' tothis report.

b. There are no employees covered by Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

16. EXTRACT OF ANNUAL RETURN:

An extract of the Company's Annual Return in form MGT-9 is annexed hereto as‘Annexure IV'.

17. CORPORATE GOVERNANCE:

A report on Corporate Governance as stipulated under Schedule V of the ListingRegulations has been attached to this Annual Report.

A certificate from Mr Shailesh Kachalia a practicing Company Secretary regardingcompliance with conditions of Corporate Governance as stipulated in SEBI's ListingRegulations is annexed to this Report as ‘Annexure V'.

18. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to provisions of Section 134(3)(c) read with Section 134(5) of the Act yourdirectors state that:

(a) In preparation of the annual accounts applicable accounting standards have beenfollowed alongwith proper explanation relating to material departures;

(b) Accounting policies have been selected and applied consistently and the judgmentsand estimates made are reasonable and prudent so as to give a true and fair view of thestate of affairs of the Company at end of the financial year and of its profit for thatperiod;

(c) Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with provisions of the Act for safeguarding assets of the Companyand for preventing and detecting frauds and other irregularities;

(d) The annual accounts have been prepared on a going concern basis;

(e) Internal financial controls to be followed by the Company have been laid down andsuch internal financial controls are adequate and operating effectively; and

(f) Proper systems have been devised to ensure compliance with provisions of allapplicable laws and such systems are adequate and operating effectively.

19. GENERAL:

Your directors state that no disclosure or reporting is required for the following asthere were no transactions of the types covered thereby during the year;

i. Details relating to Deposits covered under Chapter V of the Act;

ii. Issue of equity shares with differential rights as to dividend voting orotherwise;

iii. Issue of shares (including sweat equity shares) to employees of the Company underany scheme;

iv. No significant or material orders were passed by Regulators or Courts or Tribunalswhich impact the Company's going concern status and operations in the future.

v. Conservation of Energy Technology and Foreign Exchange Earnings; and

vi. No material changes and commitments have occurred after the close of the year tillthe date of this report which might affect the financial position of the Company.

Your directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.

20. ACKNOWLEDGEMENTS:

The Board sincerely thanks all stakeholders for their continued support.

For and on behalf of the Board
Banwari Lal Jatia Om Prakash Adukia
Managing Director Director
Dated: 4th September 2017 (DIN: 00016823) (DIN: 00017001)