To the Member(s)
The Board of Directors hereby submits the report of the business and operations of yourCompany (the Company' or HEMO') along with the audited financial statementsfor the financial year ended March 31 2017.
1. FINANCIAL RESULTS:
| || |
(Amount in Rupees)
|Particulars ||Standalone |
| ||F.Y. 2016-17 ||F.Y. 2015-16 |
|Sales ||5984164 ||1109676 |
|Other Income ||60 ||17216 |
|Total Income ||5984224 ||1126892 |
|Profit Before Depreciation & Tax (PBDT) ||(786323) ||(1754040) |
|Less: Depreciation ||0 ||607152 |
|Add: Extra Ordinary item ||- ||- |
|Profit Before Taxation (PBT) ||(786323) ||(1146888) |
|Less: Taxation (all Taxes) ||- ||- |
|Exceptional Items : Loss on Sale of fixed Assets ||- ||(8112804) |
|Profit on sale of fixed assets ||- ||1031666 |
|Profit After Taxation (PAT) ||(786323) ||(8228026) |
2.Overview of Financial Performance:
The Company is having a positive attitude over the business and is focusing on toreduce the previous year's losses. As compared to previous year Turnover of Rs 1109676the company has booked turnover of Rs 5984224 in current year the Company
To conserve resources for future prospect and growth of the Company your Directorsregret to declare Dividend for the Financial Year 2017-18 (Previous year - Nil).
4.Change in Nature of Business:
There were no material changes in the nature of business of the Company during the yearunder review.
5.BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Constitution of Board:
The Board of the Company comprises of five Directors out of which two is PromoterExecutive Director one is Non-Promoter Non-Executive Director and rest of the Directorsis Non-Promoter Non-Executive Independent Directors. As on the date of this report theBoard comprises following Directors;
| || || || ||No. of Committee^ || |
|Name of Director ||Category Cum Designation ||Date of Appointment at current Term & designation ||Total Directorship ||in which Director is Members ||in which Director is Chairman ||No. of Shares held as on March 31 2017 |
|Mr. Dineshbhai Shanabhai Patel ||Managing Director (Promoter) ||August 28 1992 ||1 ||- ||1 ||536940 Equity Shares |
|Ms. Sonalben Patel ||Executive Director ||July 01 1994 ||1 ||1 ||- ||47000 Equity Shares |
|Ms. Kinnariben Patel ||Non - Executive Director ||July 20 2006 ||1 ||- ||- ||- |
|Mr. Krushnakant Rameshbhai Patel ||Independent Director ||September 30 2006 ||1 ||0 ||2 ||- |
|Mr. Pankaj Rameshbhai Patel ||Independent Director ||July 20 2006 ||1 ||1 ||1 ||- |
^ Committee includes Audit Committee and Shareholders' Grievances Committee across allPublic Companies.
The composition of Board complies with the requirements of the Companies Act 2013("The Act"). Further in pursuance of Regulation 15(2) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations") the Company is exempted from requirement of having composition ofBoard as per Listing Regulations. None of the Directors of Board is a member of more thanten Committees or Chairman of more than five committees across all the Public companies inwhich they are Director. The necessary disclosures regarding Committee positions have beenmade by all the Directors.
Regular meetings of the Board are held at least once in a quarter. Additional Boardmeetings are convened to discuss and decide on various business policies strategies andother businesses. During the year under review Board of Directors of the Company met 8(Eight) times viz May 24 2016 June 02 2016 August 04 2016 August 22 2016September 05 2016 November 14 2016 February 14 2017 and March 31 2017.The gapbetween two consecutive meetings was not more than one hundred and twenty days as providedin section 173 of the Act. The details of attendance of each Director at the Board Meetingand Annual General Meeting are given below;
|Name of Director ||Mr. Dineshbhai Patel ||Ms. Sonalben Patel ||Ms. Kinnariben Patel ||Mr. Krushnakant Patel ||Mr. Pankaj Rameshbhai Patel |
|No. of Board Meeting held ||8 ||8 ||8 ||8 ||8 |
|No. of Board Meeting attended ||8 ||8 ||8 ||8 ||8 |
|Presence at the previous AGM ||Yes ||Yes ||Yes ||Yes ||Yes |
|Presence at the previous EGM held on March 172017 ||Yes ||Yes ||Yes ||Yes ||Yes |
The Independent Directors of the Company has met on March 31 2017 inter alia toevaluate the performance of Non-Independent Directors Board as a whole and performance ofChairman of the Company.
In terms of Section 149 of the Companies Act 2013 and rules made there under theCompany has two Non-Promoter Independent Directors in line with the Companies Act 2013. Aseparate meeting of Independent Directors was held on March 31 2017 to review theperformance of Non-Independent Directors and Board as whole and performance of Chairpersonof the Company including assessment of quality quantity and timeliness of flow ofinformation between Company management and Board. The terms and conditions of appointmentof Independent Directors and Code for Independent Director are incorporated on the websiteof the Company at www.hemoorganiclimited.com. The Company has received necessarydeclaration from each independent director under Section 149 (7) of the Companies Act2013 that they meet the criteria of independence laid down in Section 149 (6) of theCompanies Act 2013.
Information on Directorate:
In accordance with the provisions of the Articles of Association and Section 152 of theCompanies Act 2013 Ms. Kinnariben Patel retires by rotation at the ensuing annualgeneral meeting. She being eligible has offered herself for re-appointment as beingeligible to be reappointed.The Board of Directors recommends her appointment on the Board.The relevant details as required under Regulation 36 (3) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 ("SEBI Listing Regulations") of theperson seeking appointment/ re-appointment as Director are also provided in ANNEXURE TOITEMS 2 OF THE NOTICE convening the annual general meeting. None of the Director ofthe Company is serving as a Whole-Time Director in any Listed Company and is holdingposition of Independent Director in more than 3 Listed Company and none of the Director ofthe Company is holding position as Independent Director in more than 7 Listed Company.Further none of the Directors of the Company is disqualified for being appointed asDirector as specified in Section 164 (2) of the Companies Act 2013.
Key Managerial Personnel:
In accordance with Section 203 of the Companies Act 2013 the Company has Mr.Dineshbhai Patel who is acting as Managing Director of the Company.
The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act. Theperformance of the board was evaluated by the board after seeking inputs from all thedirectors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc. The performance of thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition of committees effectiveness ofcommittee meetings etc. The board and the nomination and remuneration committee reviewedthe performance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the chairman was also evaluated on the key aspectsof his role. Separate meeting of independent directors was held to evaluate theperformance of non-independent directors performance of the board as a whole andperformance of the chairman taking into account the views of executive directors andnon-executive directors. The same was discussed in the board meeting that followed themeeting of the independent directors at which the performance of the board itscommittees and individual directors was also discussed. Performance evaluation ofindependent directors was done by the entire board excluding the independent directorbeing evaluated.
Directors' Responsibility Statement:
Pursuant to section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:
a) In preparation of annual accounts for the year ended March 31 2017 the applicableaccounting standards have been followed and that no material departures have been madefrom the same;
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 or loss of the Company for that year;
c) The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) The Directors had prepared the annual accounts for the year ended March 31 2017 ongoing concern basis.
e) The Directors had laid down the 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 provisions ofall applicable laws and that such systems were adequate and operating effectively.
COMMITTEES OF BOARD:
The Board of Directors in line with the requirement of the act and listingregulations has formed various committees details of which are given hereunder.
A. Audit Committee:
The Company has formed audit committee in line with the provisions Section 177 of theCompanies Act 2013. The Audit Committee met 5 (Five) times during the financial year2016-17 on May 24 2016 August 04 2016 November 14 2016 and February 14 2017. Thecomposition of the Committee and the details of meetings attended by its members are givenbelow:
|Name of Members ||Designation ||Number of meetings during the financial year 2016 -17 |
| || ||Held ||Attended |
|Mr. Pankaj R.Patel ||Chairman ||5 ||5 |
|Mrs. Sonal D. Patel ||Member ||5 ||5 |
|Mr. Krushankant R. Patel ||Member ||5 ||5 |
The Statutory Auditors of the Company are invited in the meeting of the Committeewherever requires.
Mr. Pankaj R. Patel the Chairman of the Committee had attended last Annual GeneralMeeting of the Company held on September 30 2016. Recommendations of Audit Committee havebeen accepted by the Board of wherever/whenever given.
The Company has established a vigil mechanism and accordingly framed a Whistle BlowerPolicy. The policy enables the employees to report to the management instances ofunethical behavior actual or suspected fraud or violation of Company's Code of Conduct.Further the mechanism adopted by the Company encourages the Whistle Blower to reportgenuine concerns or grievances and provide for adequate safe guards against victimizationof the Whistle Blower who avails of such mechanism and also provides for direct access tothe Chairman of the Audit Committee in exceptional cases. The functioning of vigilmechanism is reviewed by the Audit Committee from time to time. None of the Whistleblowers has been denied access to the Audit Committee of the Board. The Whistle BlowerPolicy of the Company is available on the website of the Company atwww.hemoorganiclimited.com.
B. Nomination and Remuneration Committee:
The Company has formed Nomination and Remuneration committee in line with theprovisions Section 178 of the Companies Act 2013. Nomination and Remuneration Committeemeetings are generally held for identifying the person who is qualified to becomeDirectors and may be appointed in senior management and recommending their appointmentsand removal. During the year under review Nomination and Remuneration Committee met 2(Two) times viz on September 5 2016 and March 31 2017.
The composition of the Committee and the details of meetings attended by its membersare given below:
| || ||Held ||Attended |
|Mr. Krushankant R. Patel ||Chairman ||2 ||2 |
|Mr. Pankaj R.Patel ||Member ||2 ||2 |
|Mrs. Sonal D. Patel ||Member ||2 ||2 |
Nomination and Remuneration Policy:
Nomination and Remuneration Policy in the Company is designed to create a highperformance culture. It enables the Company to attract motivated and retained manpower incompetitive market and to harmonize the aspirations of human resources consistent withthe goals of the Company. The Company pays remuneration by way of salary benefitsperquisites and allowances to its Managing Director and the Executive Directors.
Key points of the Nomination and Remuneration Policy are;
a. Policy on Appointment of Directors Key Managerial Personnel and SeniorManagement Personnel:
The policy is formulated to identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director Key ManagerialPersonnel and Senior Management personnel and recommend to the Board for his / herappointment. A person should possess adequate qualification expertise and experience forthe position he/ she is considered for appointment. In case of appointment of IndependentDirector the Committee shall satisfy itself with regard to the independent nature of theDirector vis--vis the Company so as to enable the Board to discharge its function andduties effectively.
b. Policy on remuneration of Director KMP and Senior Management Personnel:
The Company's remuneration policy is driven by the success and performance of DirectorKMP and Senior Management Personnel vis--vis the Company. The Company's philosophy is toalign them with adequate compensation so that the compensation is used as a strategic toolthat helps us to attract retain and motivate highly talented individuals who arecommitted to the core value of the Company. The Company follows mixed of fixed paybenefits and performance based variable pay. The Company pays remuneration by way ofsalary benefits perquisites and allowance. The remuneration and sitting fees paid by theCompany are within the salary scale approved by the Board and Shareholders. The Nominationand Remuneration Policy as adopted by the Board of Directors is placed on the website ofthe Company at www.hemoorganiclimited.com.
Remuneration of Directors:
The details of remunerationis disclosed during the financial year 2016-17 is providedin Form MGT-9 which is the part of this report.
C. Stakeholders' Grievances and Relationship Committee:
The Company has constituted Stakeholder's Grievance & Relationship Committee mainlyto focus on the redressal of Shareholders' / Investors' Grievances if any like Transfer/ Transmission / Demat of Shares; Loss of Share Certificates; Non-receipt of AnnualReport; Dividend Warrants; etc. During the year under review Stakeholder's Grievance& Relationship Committee met 4 (Four) times on May 24 2016 August 4 2016 November14 2016 and February 14 2017. The composition of the Committee and the details ofmeetings attended by its members are given below:
| || ||Number of meetings during the financial year 2016 -17 |
|Name of Members ||Designation ||Held ||Attended |
|Mr. Dinesh S. Patel ||Chairman ||4 ||4 |
|Mr. Krushankant R. Patel ||Member ||4 ||4 |
|Mr. Pankaj R.Patel ||Member ||4 ||4 |
During the financial year 2016-17 the Company has not received any complaint frominvestor. Further there was no complaint pending for resolved at the end of financialyear 2016-17.
The Company has not accepted any deposits from Shareholders and Public falling withinthe ambit of Section 73 of the Companies Act 2013 and the Companies (Acceptance ofDeposits) Rules 2014. There were no deposits which were claimed and remained unpaid bythe Company as on March 31 2017.
The Paid up Equity Share Capital as at March 31 2017 stood at Rs. 346.59 Lakh. Duringthe year under review the Company has not issued any Share Capital.
8.PARTICULARS OF LOANS GUARANTEES INVESTMENTS & SECURITY:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statement.
9.TRANSACTIONS WITH RELATED PARTIES:
During the financial year 2016-17 the Company has not entered into transactions withrelated parties as defined under Section 2(76) of the Companies Act 2013 hence nodisclosure is required for the same
10. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The details on Internal Financial Control and their adequacy are provided in ManagementDiscussion and Analysis Report.
11. MATERIAL CHANGES AND COMMITMENT:
There has been no material changes occurred subsequent to the close of the financialyear of the Company to which the balance sheet relates and the date of the report.
12. DISCLOSURE OF REMUNERATION:
The information required under section 197 of the Act read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are given as an Annexure
13. EXTRACT OF ANNUAL RETURN:
As provided under section 92(3) of the Act the extract of annual return is given in Annexure 2 in the prescribed Form MGT-9 which forms part of this report.
14. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
To foster a positive workplace environment free from harassment of any nature we haveinstitutionalized the Anti-Sexual Harassment Initiative (ASHI) framework through which weaddress complaints of sexual harassment at the all workplaces of the Company. Our policyassures discretion and guarantees non-retaliation to complainants. We follow agender-neutral approach in handling complaints of sexual harassment and we are compliantwith the law of the land where we operate. During the year under review there were noincidences of sexual harassment reported.
15. RISK MANAGEMENT:
A well-defined risk management mechanism covering the risk mapping and trend analysisrisk exposure potential impact and risk mitigation process is in place. The objective ofthe mechanism is to minimize the impact of risks identified and taking advance actions tomitigate it. The mechanism works on the principles of probability of occurrence andimpact if triggered. A detailed exercise is being carried out to identify evaluatemonitor and manage both business and non-business risks.
16. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
There was no energy conservation technology absorption and foreign exchange earningsand outgo
17. CORPORATE GOVERNANCE:
Your Company strives to incorporate the appropriate standards for corporate governance.However pursuant to Regulation 15(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company is not required to mandatorily comply with theprovisions of certain regulations of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and therefore the Company has not provided a separatereport on Corporate Governance although few of the information are provided in thisreport of Directors under relevant heading.
18. MANAGEMENT DISCUSSION AND ANALYSIS:
Management Discussion and Analysis Report for the year under review as stipulatedunder Schedule V of the Listing Regulations is presented in a separate section formingpart of this Annual Report.
19. STATUTORY AUDITOR & THEIR REPORT:
M/s. M A A K & Associates Chartered Accountants (FRN: 135024W) is acting asStatutory Auditor of the Company. The Members of the Company had in its last AnnualGeneral Meeting held on September 30 2016 appointed M/s. M A A K & AssociatesChartered Accountants to hold office from the conclusion of 24th Annual GeneralMeeting till the conclusion of 25th Annual General Meeting of the Company to beheld in the year 2017. The Auditors' Report for financial year 2016-17 is self-explanatoryand does not contain any qualification reservation or adverse remark. The Auditors'Report is enclosed with the financial statements in this Annual Report.
20. REPORTING OF FRAUD:
The Auditors of the Company have not reported any fraud as specified under Section143(12) of the Companies Act 2013.
21. SECRETARIAL AUDITOR & THEIR REPORT:
The Company has appointed Mrs Ankita Patel Practicing Company Secretaries to conductthe secretarial audit of the Company for the financial year 2016-17 as required underSection 204 of the Companies Act 2013 and Rules there under. The Secretarial Audit Reportfor the financial year 2016-17 is annexed to this report as an Annexure 3.The Secretarial Audit Report contains notations for non-appointment of Internal AuditorCompany Secretary and CFO. Further we are in process to find the proper candidate andappoint the same.
22. GENERAL DISCLOSURE:
Your Directors state that the Company has made disclosures in this report for the itemsprescribed in section 134 (3) of the Act and Rule 8 of The Companies (Accounts) Rules2014 and other applicable provisions of the act and listing regulations to the extent thetransactions took place on those items during the year. Your Directors further state thatno disclosure or reporting is required in respect of the following items as there were notransactions on these items during the year under review;
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 save and ESOS;
iv. Annual Report and other compliances on Corporate Social Responsibility;
v. There is no revision in the Board Report or Financial Statement;
vi. 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;
vii. Information on subsidiary associate and joint venture companies.
Your Directors wish to place on record their sincere appreciation for significantcontributions made by the employees at all levels through their dedication hard work andcommitment enabling the Company to achieve good performance during the year under review.Your Directors also take this opportunity to place on record the valuable co-operation andsupport extended by the banks government business associates and the shareholders fortheir continued confidence reposed in the Company and look forward to having the samesupport in all future endeavors.
| ||By Order of the Board of Directors |
| ||For Hemo Organic Limited |
| ||Dr. Dinesh Patel |
|Place: Anand ||Chairman and Managing Director |
|Date: September 4 2017 ||DIN: 00481641 |
Annexure I Particulars of Employees
(pursuant to Section 197(12) read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 as amended)
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rules made there under A. Information as perRule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules 2014 a) The ratio of remuneration of each director to themedian remuneration of employees for the financial year:
|Sr. No. ||Name ||Designation ||Nature of Payment ||Ratio against median employee's remuneration |
|1 ||Dr. Dinesh Patel ||Managing Director ||Remuneration ||NA |
*Dr. Dinesh Patel has drawn NIL salary
b) The Percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
|Sr. No. ||Name ||Designation ||Nature of Payment ||Percentage Increase over previous year |
|1. ||Dr. Dinesh Patel ||Managing Director ||Remuneration ||NA |
c) The percentage increase in the median remuneration of employees in the financialyear: The Company has not computed median remuneration in previous year there was nopayout to Directors of the Company. Hence Median could not be computed.
d) The number of permanent employees on the rolls of the Company: 4 Employees
e) Average percentile increase in the Salaries of the Employees and ManagerialRemuneration:
The Average salaries of the employees of the Company were decreased by 41.98%. Annualincrements if any are decided by the Nomination and Remuneration Committee within thesalary scale approved by the members and are effective from April 1 of each year. TheBoard of Directors of the Company affirmed that remuneration of all the Key ManagerialPersonnel of the Company are as per the Remuneration Policy of the Company.
| ||By Order of the Board of Directors |
| ||For Hemo Organic Limited |
| ||Dr. Dinesh Patel |
|Place: Anand ||Chairman and Managing Director |
|Date: September 4 2017 ||DIN: 00481641 |