The Directors of your Company have pleasure to present 44th Annual Report with theAudited Statements of Accounts forthe year ended 31st March 2016.
| ||2015-16 ||2014-15 |
| ||Rs. lacs ||Rs. lacs |
|FINANCIAL RESULTS || || |
|Total Revenue ||9926.46 ||12208.33 |
|Profit for the year after deducting all the expenses but before interest depreciation and taxation (EBIDTA) ||948.30 ||1233.03 |
|FROM WHICH ARE DEDUCTED || || |
|Interest & Financial Charges ||0.17 ||0.08 |
|Depredation ||474.64 ||511.40 |
|Provision for Taxation || || |
|Current ||125.00 ||190.00 |
|Deferred ||(17.98) ||(90.34) |
| ||581.83 ||611.14 |
|NET PROFIT FOR THE YEAR TO WHICH IS ADDED : ||366.47 ||821.89 |
|Surplus Brought Foward ||364.61 ||1132.43 |
|BALANCE AVAILABLE FOR APPROPRIATION ||751.08 ||1754.32 |
|APPROPRIATION FOR || || |
|Proposed Dividend ||64.60 ||141.00 |
|Corporate Dividend Tax ||17.22 ||28.71 |
|General Reserve ||350.00 ||1200.00 |
|Surplus Carried to next years account ||299.26 || |
| ||751.08 ||1754.32 |
ECONOMIC SCENARIO & OUTLOOK:
The turnover of the company has decreased by about 18.83% overthe previous year.
Gelatine sales have decreased by 3.85% and whereas Ossein sates have reduced by 64.90%during the year.
The performance of the company is adversely affected due to shortage of raw materialsleading to a steep rise in raw material prices and thereby leading to higher manufacturingcosts. Increase in manpower and labour costs have also put pressure on margins andoperating profits during the year.
During the year the company completed to the tune of 90% of modernization of the rawmaterial grading facility. The final completion of this project would take place duringthe current financial year 2016-17. This measure being undertaken by the company islikely to lead increased yield of the company's products.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
A Report on Management Discussion and Analysis is annexed herewith as'Annexure-A".
Your directors recommend dividend @ 9% i.e. 7 0.90/- per share (previous year 15% i.e.71.50 per share) on Equity Shares of Rs. 10/- each of the company for the year ended 31stMarch 2016. The proposed dividend (including Corporate Dividend Tax) will absorb Rs.101.82 Lacs (previous year Rs.169.71 Lacs)
The Company has made a provision of Rs.125.00 lacs towards current year's Income Tax.
The Company continues to get requisite assistance and co-operation from its bankers asand when needed.
All the properties of the Company including building plant and machinery and stockshave been adequately covered underinsurance.
Industrial relations continued to remain cordial and satisfactory.
During the financial year 2015-16 your Company has not accepted any deposit within themeaning of Sections 73& 74 of the CompaniesAct 2013 read together with the Companies(Acceptance of Deposits) Rules 2014.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS:
The Corporate Governance and Management Discussion & Analysis Report which form anintegral part of this Report are set out as separate Annexures together with theCertificate from the auditors of the Company regarding compliance with the requirements ofCorporate Governance as stipulated under various regulations of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
Mr. Nayan C. Mirani a Non executive Director of the Company has resigned w.e.f.30" June 2015. The Board has placed on record its sincere appreciation and gratitudefor the valuable and outstanding contribution made by Mr. Nayan C. Mirani during hisassociation with the Company as a Director.
At the ensuing Annual General Meeting of the Company Mrs. Shefali V. Mirani Directorof the Company retires by rotation but being eligible offers herself for reappointment.
DIRECTORS' RESPONSIBILITY STATEMENT:
As stipulated in Section 134 (3)(c) of the Companies Act 2013 your Directors adhereto the "Directors' Responsibility Statement" and confirm as under:
i) that in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures;
ii) that the directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for the year;
iii) that the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv) that the directors have prepared the annual accounts on a going concern basis;
v) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;
vi) that systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.
AUDITORS AND AUDITORS' REPORT:
At the 42nd AGM of your Company Messrs Mahendra N. Shah & Co. FineRegistration No: 105775W Chartered Accountants were appointed as the Statutory Auditorsof the Company fora term of three years form 2014-2015 to 2016-2017. In accordance withSection 139 of the Act you are requested to ratify the appointment of Statutory Auditorsfor the balance term.
Pursuant to the provisions of Section 204 of the Companies Act 2013 readwith the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 yourCompany has appointed M/s. Samdani Shah & Associates Practicing Company Secretariesto conduct the Secretarial Audit of your Company. The Secretarial Audit Report is annexedherewith as "Annexure-E" to this report
POLICY ON DIRECTORS'APPOINTMENT AND REMUNERATION:
(Including criteria for determining qualification positive attributes independence ofa Director policy relating to remuneration of Directors Key Managerial Personnel andother employees)
(a) Policyon Directors'Appointment
Policy on Directors' appointment is to follow the criteria as laid down under theCompanies Act 2013. the Listing Agreement with Stock Exchanges and good corporatepractices. Emphasis is given to persons from diverse fields or professions.
(b) Policyon Remuneration
Guiding Policy on remuneration of Directors Key Managerial Personnel and employees of(he Company is that-
Remuneration to unionized workmen is based on the periodical settlement with theworkmen union.
Remuneration to Key Managerial Personnel Senior Executives Managers Staff andWorkmen (non-unionized) is industry driven in which it is operating and also taking into accountthe performance leverage and factors such as to attract and retain quality talent.
For Directors it is based on functions and responsibilities shouldered theshareholders resolutions provisions of the Act and Rules framed therein circulars andguidelines issued by Central Government and other authorities from time to time.
ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE ITS COMMITTEES AND INDIVIDUALDIRECTORS:
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and adequate and meets the requirement of the company
DECLARATION OF INDEPENDENCE BYTHE INDEPENDENT DIRECTORS:
Pursuant to Section 149(6) of the Companies Act 2013 Independent Directors of theCompany have made a declaration confirming the compliance ofthe conditions of theindependence stipulated in the aforesaid section.
NUMBER OF MEETING OF BOARD OF DIRECTORS:
The Board of Directors have met 6 times and Independent Directors once during the yearended 31" March 2016The details of which are mentioned in the Corporate GovernanceReport annexed herewith.
DETAILS OF COMMITTEE OF DIRECTORS:
Composition of Audit Committee of Directors Nomination and Remuneration Committee ofDirectors number of meetings held of each Committee during the financial year 2015-16 andmeetings attended by each member of the Committee as required under the Companies Act2013 are provided in Corporate Governance Report and forming part of the report.
The recommendation by the Audit Committee as and when made to Board has been acceptedby it.
KEY MANAGERIAL PERSONNEL:
Your Company has designated Mr. Viren C. Mtrani the Managing Director Mr. Kalidas P.Vagadia the Chief Financial Officer and Ms. Preetel P. Mepani Company Secretary as theKey Managerial Personnel.
LOANS INVESTMENT AND GUARANTEES BYTHE COMPANY:
There is no loan given investment made guarantee given or security provided by theCompany to any entity under Section 186 of the Companies Act 2013.
ANALYSIS OF REMUNERATION:
Pursuant to Rule 5 of the Companies (Appointment and Remuneration) Rules 2014 adisclosure on remuneration related information of employees Key Managerial Personnel andDirectors is annexed herewith as "Annexure-B".
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT- 9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 are set out herewith as"Annexure-F" to this Report.
RELATED PARTYTRANS ACTIONS:
All related party transactions that were entered into during the financial year were onan arm's length basts and were in the ordinary course of business. Form No. AOC-2 is setout herewith as "Annexure- G". There are no materially significant Related PartyTransactions made by the Company with Promoters Directors Key Managerial Personnel orother designated persons which may have a potantiai conflict with the interest of theCompany at large.
All Related Party Transactions are placed before the Audit Committee and also the Boardtor approval. Prior omnibus approval of the Audit committee is obtained for thetransactions which are of foreseen and repetitive nature. The transactions entered intopursuant to the omnibus approval so granted are audited and a statement giving details ofell related party transactions is placed before the Audit committee and the Board ofDirectors for their approval.
VIGIL MECHANISM/WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Whistle Blower Policy to deal with instance offraud and mismanagement and provide a mechanism for the Directors/Employees of the Companyto approach the designated persons/Chairman of the Audit Committee of the Company tointer alia report to the management instances of unethical behavior actual or suspectedfraud or violation of the company's code of conduct or ethics policy.
In staying true to our values strength performance and passion and in line with ourvision of being one of the most respected companies in India the Company is committed tothe high standards of corporate governance and stakeholder responsibility. The details ofthe policy is explained in the Corporate Governance Report and also posted on the websiteof the Company.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:
As a part of its initiative under "Corporate Social Responsibility (CSR) theCompany has undertaken projects in the areas of Sports Training for Tribal Children andpromoting healthcare including preventive healthcare. These projects are in accordancewith Schedule Vll of the Companies Act 2013. The Report on CSRActivities is annexedherewrthas "Annexure-D".
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe. Companies (Accounts) Rules 2014 is set out h ere with as "An n exure C"to this Report.
PARTICULARS OF EMPLOYEES:
The information under Section 134 of the Companies Act 2013 read with the Companies(Appointment end Remuneration of Managerial Personnel) Rules 2014 and forming part of theDirectors' Report for the year ended 31 March 2016 is set out herewith as "AnnexureB"
PREVENTION OF INSIDER TRADING:
The Company has adopted a Code of Fair Disclosure as per regulation 8(1) & (2) andCode of Conduct as per regulation 9(1)&(2) of the SEBI (Prohibition of InsiderTrading)Regulations 201S for Prevention of fnsiderTrading with a view to regulate trading insecurities by the Directors and designated employees of the Company. The code requires?re- clearance for dealing in the Company's Shares and prohibits the purchase or sale ofCompany shares by the Directors and the designated employees while in possession ofunpublished price sensitive information in relation to the Company and during the periodwhen the trading window is dosed. All Directors and designated employees have confirmedcompliance with the code.
The Board of Directors appreciates the devoted services of the workers staff andexecutives who have contributed to the effident management of the affaire ofthe Company.
Your directors place on record their gratitude to the State and Central Government thecompany's Bankers Customers Suppliers and Shareholders for their continued co-operationand support.
| ||For and on behalf of the Board of Directors |
| ||Viren C. Mirani |
|Place: Mumbai ||Chairman & Managing Director |
|Date : 23-05-2016 ||(DIN : 00044901) |
ANNEXURE B' TO DIRECTORS' REPORT
1. STATEMENT CONTAINING INFORMATION AS PER SECTION 197(12) OF THE COMPANIES ACT 2013READ Wrm RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL)RULES 2014 FOR THE YEAR ENDED 31 "MARCH 2016.
|Sr. No. ||Director /KMP || |
Remuneration Rs. Lacs
Median Remuneration of Employees Rs. Lacs
Increase % (Amount)
| || ||15-16 ||14-15 ||15-16 ||14-15 ||15-16 ||14-15 ||15-16 ||14-15 |
|1. ||Viren C Mirani (Managing Director) ||138.00 ||98.36 ||2.62 ||2.40 ||52.67 ||40.98 ||40.30 ||17.57 |
|2. ||Praetal P. Mepani (Company Secretary) ||7.38 ||6.24 ||2.62 ||2.40 ||2.82 ||2.60 ||18.27 ||20.23 |
|3. ||K.P.Vagedia (Chief Financial Officer) ||9.96 ||6.55 ||2.62 ||2.40 ||3.60 ||3.56 ||16.49 ||6.68 |
Note: Above % is calculated on the basis of remuneration excluding retirement benefitsand sitting fees.
2. Number of permanent employees on the rolls of the Company as on 31" March 2016were 91 Nos. and as on 31st March 2015 were 93 Nos.
3. There is no variable component of remuneration to the Directors.
4. No employee has received remuneration in excess of highest paid Director of theCompany during the Financial Year2015-2016.
5. a) Performance of the Company:
1. Profit before Tax:
Rs. in Lacs
|Description ||2015-2016 ||2014-2015 |
|Profit before tax ||473.49 ||721.55 |
2. Variations in EPS of the Company:
|Description ||As on 31.03.2016 ||As on 31.03.2015 |
|EPS ||3.90 ||6.62 |
STATEMENT CONTAINING INFORMATION AS PER SECTION 197(12) READ WITH THE RULES 5(2) AND5(3) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014FOR THE YEAR ENDED 31ST MARCH 2016.
|Name ||Designation ||Remuneration Rs. Lacs ||Qualification ||Age Years ||Experience Year ||Date of Commencement of employment ||Last Employment and Designation |
|Viren C. Mirani ||Chairman & Managing Director ||20561 ||B.Com. ||51 ||31 ||21.07.2000 ||Sr. Executive in India Gelatine & Chemicals Ltd. |
1. The above employment is contractual.
2 The Remuneration also includes retirement benefits Like contribution to ProvidentFund Gratuity Unavailed Leave etc. payable to the Managing Director.
ANNEXURE C' TO DIRECTORS' REPORT
INFORMATION IN RESPECT OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNINGS ANDOUTGO
(Section 134(3)(m) ot the Companies Act 2013 read with rule 0(3) of the Companies(Accounts) Rules 2014]
(A) CONSERVATION OF ENERGY:
a) Measures taken for Conservation of Energy:
i) Improved pretreatment process that has resulted in better gelatine yield therebyreducing cost of production.
ii) Intermittent running of ETP equipment based on pollutant load has resulted in lowertreatment cost.
iii) Addition of new equipment and processes that have resulted in value addition Inquality of product.
b) Additional Investments and proposals:
i) Replacement of transparent sheets in building roofs in order to reduce lightingcost.
ii) Continue modification in ETPin order to achieve state pollution norms autonomously.
iii) Re-evaluation of feasibility of supplementing power requirement with Solar PowerGeneration.
iv) Installation of Wind Driven Roof Ventilators for saving of energy.
v) Implementation of new Cleaning-in-process system that will result in saving of timewater and chemicals.
vi) Studying feasibility of in-house power generation using alternate fuel inordertosave electricity cost
vii) Awaiting approval from SLDC for Power Trading vide National Power Exchange to saveon power cost.
c) Impact of measures in the above:
On implementation of the above the Company expects to substantially benefit in savingpower chemical & water consumption at various stages of the production cycle.
d) Total energy consumption and energy consumption per unit of product:
|1 Power& Fuel Consumption || || |
|Electricity ||2015-16 ||2014-15 |
|a) Purchased || || |
|Unit (KWH) ||10101300.00 ||12051600.00 |
|Totaf Amount ( Rs. lacs) ||707.26 ||942.83 |
|Hate/Unit ( Rs.) ||7.00 ||7.2B |
|b) Own Generation || || |
|1) Through Diesel Generator || || |
|Units (KWH) ||18432.00 ||36192.00 |
|Unit per Ltr. of Diesel ||3.25 ||3.09 |
|Cost/Unit ( Rs.) ||20.35 ||21:43:-: |
|2) Through FO Base Generator || || |
|Units (KWH) ||N.A. || |
|Unit per Ltr. ot F.O ||N.A. || |
|Cost/Unit ( Rs.) ||N.A. || |
|3) Through Steam Turbine Generator ||N.A. || |
|4) Through Gas Base Generator || || |
|Units (KWH) ||N.A. ||- |
|Unit per SMa of Gas ||N.A. || |
|Cost/Unit ( Rs.) ||N.A. ||N.A. |
|a) Furnace Oil/LSHS || || |
|Quantity (Kgs.) ||1872200.00 ||682144.00 |
|Total Amount ( Rs. lacs) ||420.98 ||178.10 |
|Average Rate per Kgs. ( Rs.) ||22.49 ||26.11 |
|b) Natural Gas (CNG) /SMJ || || |
|Ouantity (SMs) ||398883.00 ||2686791.00 |
|Total Amount ( Rs. lacs) ||129.92 ||1207.03 |
|Average Hate perSM3 ( Rs.) ||32.57 ||44.32 |
e) Consumption per unit of product:
| ||Standards || |
|Product-Unit ||MTs ||Ossein ||Gelatine ||Ossein ||Gelatine |
|Electricity ||Unit ||2003.40 ||3644.59 ||1638.42 ||3418.09 |
|Furnace Oil ||Kgs ||0.00 ||1419.40 ||0.00 ||1335.05 |
|Natural Gas (CNG) ||SM3 ||243.10 ||1697.36 ||446.19 ||1581.07 |
(B) TECHNOLOGY ABSORPTION:
Research and Development
i. For quality improvement of the main products viz. Ossein and Gelatine Research andDevelopment is carried out by the Company.
ii. The quality of the products manufactured by the company has been accepted by ourbuyers. There is no rejection in the goods exported. However there is ample scope forfurther improvement in the quality.
iii. Research is being done to establish how our waste can be used as raw materialinput for other industries.
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on Foreign Exchange Earnings and outgo is contained in point No.141516 & 17 of Note No. 25 to the Financial Statements.
| ||For and on behalf of the Board Df Directors |
|Place: Mumbai ||Viren C. Mirani |
|Date : 23-05-2016 ||Chairman & Managing Director |
|DIN: 00044901 |