Your Directors have pleasure in presenting the 54th Annual Report and Accounts for theyear ended 31st March 2018.
The highlights of the financial results are as follows:
| ||Year ended March 2018 ||Year ended March 2017 |
| ||(Rs. in lacs) ||(Rs. in lacs) |
|Profit before tax ||7283 ||7130 |
|Less: Tax expenses || || |
|Current tax ||2195 ||2445 |
|Deferred tax ||313 ||(15) |
|Profit after tax ||4775 ||4700 |
|Add: Other Comprehensive income || || |
|(i) Items that will not to be reclassified to Profit or Loss ||(27) ||(56) |
|(ii) Income Tax relating to items that will not be reclassified to Profit or Loss ||9 ||19 |
|Other Comprehensive Income (Net of Tax) ||(18) ||(37) |
|Total Comprehensive Income for the year ||4757 ||4663 |
During the financial year ended 31st March 2018 the net profit after tax of thecompany has increased to Rs. 4775 lacs as compared to previous year's net profit aftertax of Rs. 4700 lacs. The turnover of the Company increased to Rs. 994 crores as comparedto Rs. 963 crores of the previous year.
The Directors are pleased to recommend a dividend of Rs. 3.50 [35%] per equity sharefor the financial year ended 31st March 2018.
On the economic policy front the effects of demonetisation that spilled into FY 2018and introduction of the Goods and Services Tax (GST) - the biggest tax reform sinceindependence had a substantial impact in 2018. While these transformations resulted intemporary disruptions they were necessary for a robust sustainable growth.
The International Monetary Fund (IMF) remains bullish on India's growth potential forthe coming fiscal and has projected its GDP forecast for FY 2019 at 7.3%. Corporate Indiaacross sectors has started equipping itself for growth as their capacity utilisation isrising and likely to accelerate in 2019.
The growth in the performance of the manufacturing and construction sectors postdemonetisation and GST will have a positive impact on the demand for water wastewatertreatment and solid waste management in India. Government directive promotingsustainability makes it mandatory to recycle and reuse wastewater. This policy enforcesestablishment of wastewater treatment plants in some of the key areas and largeresidential complexes followed by the subsequent reuse of treated wastewater in the city'sindustrial belt. Directives such as these are a big propellant for the waste watermanagement industry in our country.
The Swachh Bharat Abhiyan' and Namami Gange' projects are expected to gainmomentum after course corrections.
Similarly initiatives by the government such as the `Smart Cities Mission' and the`Rural Water Supply and Sanitation (RWSS)' project will create opportunities for yourcompany. Climate change and its effect put water resources under tremendous pressure. Thisis amplified by the high water requirements and consumption patterns in urban India whichgenerates the demand for alternative water resources. Your company continues to lead withits technologically superior solutions to meet this demand by treating seawater sewageand industrial waste where it has set up impressive references.
As India envisages a paradigm shift from the linear to the circular economy yourcompany is poised to take advantage of the opportunities presented by the ensuing policyamendments.
With a robust portfolio of offerings in the water waste water management and solidwaste management industry a strong customer-centric outlook and a strategic mindset yourcompany is confident to maintain its leadership position in water industry.
The Company has not accepted any deposits during the year within the meaning ofSection 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits)Rules 2014.
Particulars of Loans Guarantees or Investments
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 Statements.
Aqua Investments (India) Ltd. and Watercare Investments (India) Ltd.
During the year ended 31st March 2018 the Subsidiary companies M/s. Aqua Investments(India) Limited posted profit after tax of Rs. 17.93 lacs compared to Rs. 14.19 lacs ofthe previous year and M/s. Water Care Investments (India) Ltd. posted profit of Rs. 11.94lacs compared to Rs. 10.65 lacs of the previous year.
Ion Exchange Enviro Farms Limited (IEEFL)
The Company achieved a turnover of Rs. 69.40 lacs during the year under review asagainst Rs. 71.02 lacs in the previous year.
During the pending appeal at Securities Appellate Tribunal (SAT) against SEBI theCompany has submitted additional affidavit containing details of investors exited from thescheme by sale of their lands to third parties. Appeal cites practical difficulties inimplementation of SEBI Order for formal closure of the Scheme as most of the investorshave already received their lands / refund as per the agreement. Appeal is expected to betaken up for a final hearing
Ion Exchange Asia Pacific Pte Ltd. Singapore Exchange Asia Pacific (Thailand) Ltd.Thailand and Exchange Asia Pacific Indonesia
The Company achieved a consolidated turnover of Rs. 842.45 lacs for the year underreview.
During the year economic uncertainties in the region continued. The Company has alsoinitiated process of restructuring its operations in this region which has resulted inreduction of losses.
IEI Environmental Management [M] SDN.BHD Malaysia
The Company achieved a turnover of Rs. 8.51 lacs for the year under review.
The Company's main activity is trading in water chemicals resins and taking upprojects of installing water filtration plants of any nature. The Company has beenestablished with a view of facilitating operations in Malaysia and is a strategicinvestment which would be crucial for increasing the overall exports to the country.
Ion Exchange Environment Management (BD) Limited Bangladesh
The Company achieved a turnover of Rs. 1079.30 lacs for the year under review.
The Company's main focus area is industrial water and waste water treatment. TheCompany proposes to enter into infrastructure segment in near future.
Ion Exchange WTS (Bangladesh) Limited Bangladesh
The Company achieved a turnover of Rs. Nil for the year under review.
The Company is currently not in operation.
Ion Exchange & Co. LLC Oman
The Company achieved a turnover of Rs. 1821.57 lacs for the year under review asagainst Rs. 1944.43 lacs for the previous year. The Company registered profit after taxof Rs. 160.26 lacs as compared to Rs. 179.44 lacs for previous year.
The Company is set up to address the need of Middle East market specially Oman.
The company has started looking into possible infrastructure sector for drinking waterand sewage treatment plants.
Ion Exchange LLC USA
The Company achieved a turnover of Rs. 2609.39 lacs for the year under review.
Due to increase in turnover and better realisation in some of the. product lines theCompany improved its profits from Rs. 64.32 lacs to Rs. 102.06 lacs.
Ion PT Ion
This subsidiary is established to address the needs of US and Canada markets.
The major focus continues to be marketing of Ion Exchange resins. Focus to promotespeciality resins has helped in improving the Company's margins.
Ion Exchange Projects and Engineering Limited
The Company achieved a turnover of Rs. 3345.48 lacs for the year under review. TheCompany has provided project Management services and design services to the parent companyfor its ongoing contracts which ensured better utilisation of its resources thus resultingin substantial reduction of losses from Rs. 633.18 lacs to Rs. 53.77 lacs.
Global Composites and Structurals Limited
The Company achieved a turnover of Rs. 439.15 lacs for the year under review.
The Company is in the business of providing integrated engineering services across thelife cycle of a project and has expertise in the manufacture of RO pressure tubes and FRPtanks and electrical load distribution for water treatment industries.
Ion Exchange Safic (Pty) Limited South Africa
The Company's turnover showed improvement from Rs. 564.18 lacs to Rs. 739.17 lacs. TheCompany is a Joint venture Company set up in South Africa with Safic (Pty) Ltd. which is apart of Accentuate Group. During the year under review the business prospects from SouthAfrica and neighboring countries improved. However considering the foreign exchangefluctuations the expected turnover was impacted.
Total Water Management Services (India) Ltd.
The Company achieved a turnover of Rs. 102.80 lacs for the year under review.
The Company is in the business of providing total water management solutions across thespectrum.
During the year Astha Technical Services Limited (an Associate of the Company) wasamalgamated with Total Water Management Services Limited (a Subsidiary of the Company).
The National Company Law Tribunal Mumbai Bench approved the amalgamation vide itsorder dated 24th August 2017. The shares were issued to the shareholders of AsthaTechnical Services Limited by Transferee Company i.e. Total Water Management Services on24th January 2018.
The above results reflect the position after considering the amalgamation
Ion Exchange Purified Drinking Water Pvt.
The Company achieved a turnover of Rs. 1444.48 lacs for the year under review.
Due to improvement in operational efficiencies the company made profit after tax ofRs. 30.76 lacs as compared to previous years' loss of Rs. 16.01 lacs.
The Company is set-up as a special purpose vehicle to implement PPP (Public PrivatePartnership) project for bottle water supply to Indian Railway Catering and TourismCorporation Limited (IRCTC).
ASSOCIATE AND JOINT VENTURE COMPANIES
A statement as required under Section 129 of the Companies
Act 2013 is attached to the Annual Report in form AOC 1.
Mr. M. P. Patni Director retires by rotation and being eligible has offered himselffor re-appointment.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation25 of the Listing Regulations.
BOARD PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act 2013 and the
Listing Regulations the Board has carried out an annual performance evaluation of itsown performance the directors individually as well as the evaluation of the working ofits Committees. The evaluation was done after taking into consideration the criteria laiddown by Nomination and Remuneration committee. The criteria for evaluation includedparticipation in deliberations specific contributions made compliance with company'scode of conduct carrying out assigned tasks in timely and efficient manner and planningand formulating the company's strategies. The performance evaluation of IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmannon- independent Directors and the Board was carried out by Independent Directors. TheBoard of Directors expressed satisfaction with the evaluation process. The Board has onthe recommendation of the Nomination & Remuneration Committee framed a policy forselection and appointment of Directors Senior Management and their remuneration. TheRemuneration Policy is stated in the Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(3) (c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that:
(i) in the preparation of the annual accounts for the year ended 31st March 2018 theapplicable accounting standards have been followed along with proper explanation givenrelating to material departures if any;
(ii) appropriate accounting policies have been selected and applied consistently andjudgments and estimates were made that were reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company at the end of the financial year andof the profit of the Company for that period;
(iii) proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of the Companies Act 2013 for safeguarding the assets ofthe Company and for preventing and detecting fraud and other irregularities have beentaken to the best of their knowledge;
(iv) the annual accounts have been prepared for the financial year ended 31st March2018 on a going concern basis.
(v) proper internal financial controls were in place and that the financial controlswere adequate and were operating effectively.
(vi) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws were in place and were adequate and operating effectively.
KEY MANAGERIAL PESONNEL
The Company has following persons as Key Managerial
|Sr. No. ||Name of the Person ||Designation |
|1 ||Mr. Rajesh Sharma ||Chairman & Managing Director |
|2 ||Mr. N.M. Ranadive ||Chief Financial Officer |
|3 ||Mr. Milind Puranik ||Company Secretary |
NUMBER OF MEETINGS OF THE BOARD
The details of number of meetings of the Board held during the financial year 2017-18forms part of the Corporate Governance
WHISTLE BLOWER POLICY
The Company has a whistle blower policy to report genuine from concerns or grievances.The Whistle Blower Policy has been from the posted on the website of the Company(www.ionindia.com from the Manjellis).
RELATED PARTY TRANSACTIONS
All transactions entered with related parties for the year under from the food and drugreview were on arm's length basis and in the ordinary course of business and that theprovisions of section 188 of the Companies Act 2013 are not attracted. Further there areno material related party transactions under review with the promoters directors or keymanagerial personnel. The Company has developed a related party transactions frameworkthrough standard operating procedures for the purpose of identification and monitoring ofsuch transactions. by RCC laboratories
As per the policy on Related Party Transactions the Audit Committee granted omnibusapproval for the transactions which are repetitive in nature. The related partytransactions were placed before the Audit Committee and the Board on quarterly basis forreview pursuant to omnibus approval.
The policy on related party transactions as approved by the board of directors has beenuploaded on the website of the company. The web link of the same has been provided in thecorporate governance report. None of the directors has any pecuniary relationship vis.avis the Company
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will be provided upon request. In terms of Section 136 of the Act theReport and Accounts are being sent to the Members and others entitled thereto excludingthe information on employees' particulars which is available for inspection by the Membersat the Registered Office of the Company during business hours on working days of theCompany up to the date of the ensuing Annual General Meeting. If any Member is interestedin obtaining a copy thereof such Member may write to the Company Secretary in thisregard.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS.
There are orders no passed significant by the material Regulators / Courts whichwould impact the going concern status of the Company and its future operations.
The management of the company has always been committed to high quality products &services to its customers and ensuring safety to its customers and ensuring safety &occupation health of its employees. The integrated occupational health systemOHSAS18001:2007 the Quality system namely ISO9001:2015 and Environmental Managementsystem namely ISO14001:2015 have been adopted by your factories. The resin facility atAnkleshwar has also obtained renewed Water prestigious certificates like WQA-Gold sealcertificate Quality Association- USA Kosher Certificate council of Canada HalalCertificate from Indonesia The Indonesia Council of Ulama EU certificate Central DrugsStandard Control Organisation New Delhi WHOGMP GMP (Good Manufacturing Practice) andGLP (Good Laboratory Practice) certificate administration Gujarat state. Pharma resinfacility has been audited by the USFDA and no objections have been raised. The Chemicalfacility at Patancheru is Halal certified by Halal India. Halal India is recognised by IHI(International Halal Integrity Alliance Malaysia) and are a recognised member with theWorld Halal Council. This facility also is certified for few of the products for NSF/ANSI60 certified by UL Kosher certification and Non-toxic certificate as per OECD principlefor GLP.
Your company undertakes numerous projects to ensure that the quality of it's productsand services consistently remains the best. Further your company also undertakes regularquality improvements projects to continuously improve level of operational performance.
Pursuant to the provisions of Section 139 of the Act and the rules framed thereunderM/s. B S R & Co. LLP Chartered Accountants (Reg No. 101248W/W-100022) were appointedas statutory auditors of the Company for a period of five years from the conclusion of thefifty first annual general meeting (AGM) of the Company held on September 16 2015 tillthe conclusion of the fifty sixth AGM to be held Ratification of appointment of StatutoryAuditors is being sought from the members of the company at the ensuing AGM.
The Branch Auditors M/s. Charantimath Associates appointed to conduct Audit of IonExchange Services [ A division of Ion Exchange (India) Limited] office until theBangaluru hold conclusion of this meeting and are eligible for re-appointment.
Pursuant to the provisions of section 139 and 143(8) of the Companies Act 2013 andrules framed there under it is proposed to appoint M/s. Charantimath Associates as branchauditors of the Company from the conclusion of forthcoming AGM till the conclusion of nextAGM.
Pursuant to Section 148 of the Companies Act 2013 read with The Companies (CostRecords and Audit) Amendment Rules 2014 the cost audit records maintained by the Companyin respect of its Chemicals Manufacturing activity is required to be audited. YourDirectors had on the recommendation of the Audit Committee appointed M/s. Kishore Bhatia& Associates to audit the cost accounts of the Company for the financial year ending31st March 2018.
As required under the Companies Act 2013 the remuneration payable to the cost auditoris required to be placed before the Members in a general meeting for their ratification.Accordingly a Resolution seeking Member's ratification for the remuneration payable toM/s. Kishore Bhatia & Associates Cost Auditors is included in the Notice conveningthe Annual General Meeting.
CONSOLIDATED FINANCIAL STATEMENTS
As required by Accounting Standard 21 Consolidated Financial Statements' issuedby the Institute of Chartered Accountants of India the audited Consolidated FinancialStatements of the Group are enclosed.
The Company will make available the Annual Accounts of the subsidiary companies and therelated detailed information to any member of the Company who may be interested inobtaining the same. The annual accounts of the subsidiary companies are placed onCompany's website and the same are open for inspection at the Registered Office of theCompany.
The Consolidated Financial Statements presented by the Company include the financialresults of its subsidiary companies
A report on Corporate Governance as required under Regulation 34 of Listing Regulationsread with Schedule V (Part C) forms part of this annual report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Report on Management discussion and analysis as required under Regulation 34 of ListingRegulations read with Schedule V (Part B) forms part of this annual report.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is annexedherewith as "Annexure I".
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. GMJ & Associates a firm of Company Secretaries in Practice toundertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexedherewith as "Annexure II".
CORPOARTE SOCIAL RESPONSIBILITY (CSR)
As a part of its initiative under the "Corporate Social Responsibility"(CSR) the Company has undertaken projects in the areas of environment education and safedrinking water. These projects are in accordance with Schedule VII of the Companies Act2013 and the Company's CSR Policy. The Report on CSR activities as required underCompanies (Corporate Social Responsibility Policy) Rules 2014 is set out as"Annexure III" forming part of this report.
CONSERVATIONOFENERGYTECHNOLOGYABSORPTION FOREIGN EXCHANGE EARNINGS & OUTGO
Information in accordance with Section 134 (m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014 and forming part of this Report for the year ended 31stMarch 2018 is given in "Annexure IV".
Your Board conveys its deep appreciation of the co-operation extended by customerssuppliers banks financial institutions contribution made by employees for the company'sgrowth shareholders and fixed deposit holders.
On behalf of the Board of Directors
| ||Rajesh Sharma |
| ||Chairman & Managing Director |
|Mumbai || |
|Date: 23rd May 2018 || |