for the year ended 2016-17
Your directors are pleased to present the 28th Annual Report on the business andoperations of the Company together with the Audited Statement of Accounts for the yearended 31st March 2017.
Financial Highlights (Standalone)
During the year under review performance of your company as under:
|Particulars ||Standalone |
| ||Year ended ||Year ended |
| ||March 31 ||March 31 |
| ||2017 ||2016 |
|Sales and other Income ||3860.30 ||4116.16 |
|Profit before Depreciation (including exceptional item) ||54.45 ||75.11 |
|Depreciation ||17.95 ||17.90 |
|Profit after depreciation ||36.50 ||57.21 |
|Provision for taxation ||0.53 ||4.45 |
|Add: MAT Credit || ||0.00 |
|Profit after Tax ||35.97 ||52.76 |
|Less: || || |
|Previous year's Income/Expenses ||0.00 ||0.00 |
|Profit after previous year's adjustments ||35.97 ||52.76 |
|Add: Credit Balance || || |
|Profit Brought forward from previous year ||299.62 ||290.67 |
|Add: || || |
|Transfer from Investment allowance reserve ||0.00 ||0.00 |
| ||335.59 ||343.43 |
|Provision for Dividend ||0.00 ||1.68 |
|Provision for Dividend Tax ||0.00 ||0.34 |
|Transfer to General Reserve ||0.00 ||1.00 |
|Deferred Tax ||3.58 ||5.17 |
|Income Tax for earlier years ||0.0 ||0.00 |
|Transfer to Capital Reserve ||34.00 ||35.62 |
|Provision ||0.00 ||0.00 |
|Depreciation adjustment ||0.00 ||0.00 |
|Credit Balance Carried Over to Balance Sheet ||298.01 ||299.62 |
| ||335.59 ||343.43 |
State of Company's Affairs and Future Outlook
In the financial year 2016-17 your Company's sales declined for two reasons oneis reduction of around 52% in traded sales and secondly due to some fssai issues. TheCompany has been concentrating on its branded sales and the result is that the Company'sbranded sales have increased by 1.36% from H3487.78 cr. in 2015-16 to H3535.15 cr in2016-17. The total revenue of the financial year 2016-17 is H3857.18 Crore. Profit aftertax for the year under review is H32.39 Crore (including exceptional item) in the year2016-17. EBIDTA for the year 2016-17 was H 123.95 Crore. Further the Cash profit amountedto H50.34 crore in 2016-17.
During the year under review your Company the production from the rice mill in Biharhas seen an upward trend and rice sales increased from H48.37 cr. in 2015-16 to H60.29crores during the year 2016-17 which is a healthy sign of this potential business. Thedemand for Company's premium segment edible oils under its proprietary brand JVL Royalhave also increased.
Considering the reduced profit and limited resources the Board has not recommendeddividend for the financial year 2016-17.
Amounts Transferred to Reserves
There has been no transfer of profits to General Reserves during the year under review(previous year H1.00 crore was carried over to this reserve).
Changes in Share Capital if any
During the Financial Year 2016-17 the paid-up share capital of the Company remainunchanged to H16.794 crores.
Directors and Key Managerial Personnel
Pursuant to the provisions of sub section (6) & (7) of Section 152 of the CompaniesAct 2013 Mr. Anju Jhunjhunwala (DIN 00189221) is liable to retire by rotation at theforthcoming Annual General Meeting and being eligible have offered himself forreappointment. Relevant details pertaining to them are provided in the notice of the
Annual General Meeting. None of the directors resigned during the period under review.
However during the year under review Mr. Brajesh Kumar Misra was appointed asIndependent Director of the Company and Mr. S.N. Jhunjhunwala Managing Director was alsodesignated as Chief Executive Officer of the Company w.e.f. 2nd May 2016.
The Company has received declaration from all the Independent Directors of the Companyconfirming that they meet the criteria of Independence as prescribed under the CompaniesAct 2013 and SEBI (LODR) Regulations 2015.
The Company has devised a policy for performance evaluation of Independent DirectorsBoard Committees and other individual Directors which includes the criteria forperformance evaluation of the Non-Executive and Executive Directors.
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 and thecorporate governance requirement as prescribed by the SEBI (LODR) Regulations 2015.
The performance of the Board and Committees was evaluated by the Board after seekinginputs from all the Directors/Committee Members on the basis of the criteria such as theBoard/Committee meetings attendance information and functioning.
The Board reviewed the performance of the individual directors on the basis of thecriteria such as the contribution of the individual director to the Board and Committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings & attendance. The Chairman Managing Director& Whole Time Director was also evaluated on the key aspects of their respective roles.
Pursuant to Section 178(3)&(4) of the Companies Act 2013 the Nomination andRemuneration Committee of the Board (as mentioned in the Corporate Governance Report) hasframed criteria for determining qualifications positive attributes and independence of adirector and have adopted a policy in this respect.
In a separate meeting of Independent Directors performance of Non-IndependentDirectors performance of the Board as a whole and performance of the Chairman wereevaluated taking into account the views of the Executive Directors and Non-ExecutiveDirectors.
Particulars of Contracts or Arrangements with Related Parties
All contracts/arrangements/transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on arm's lengthbasis. During the year the Company had entered into contracts/arrangements/transactionswith few of its group & subsidiary Companies which were not material under provisionsof Section 188 of the Companies Act 2013 and for which the Company had obtained priorclearance from the Audit Committee Board/ Shareholders as required under the Act andrules made there under. The relevant disclosure for the transactions with related partyhave been made in the Standalone Audited Financial Statements under Note 43. Informationon transactions with related parties pursuant to Section 134(3)(h) of the Companies Act2013 read with rule 8(2) of the Companies (Accounts) Rules 2014 are given in Annexure IIin Form AOC 2 and the same forms part of this report.
Your directors draw attention of the members to note 43 to the financial statementwhich set out details of related party transection.
AUDITORS & AUDITORS' REPORT
The Statutory Auditors of the Company M/s Sparsh & Company Chartered AccountantsVaranasi (FRN 013070C) hold office until the conclusion of the ensuing Annual GeneralMeeting and are eligible for re-appointment. The Company has received letter from M/sSparsh & Co Chartered Accountants to the effect that their appointment if madewould be within the prescribed limits of Section 141(3)(g) of the Companies Act 2013 andthat they are not disqualified for such appointment within the meaning of Section 141 ofthe Companies Act 2013.
The Board has duly reviewed the Statutory Auditors' Report on the accounts. Theobservations and comments appearing in the Auditors' Report are self-explanatory and donot call for any further explanation/comments/clarification of the Board.
Details of Subsidiary Joint Venture or Associates
JVL Overseas Pte. Ltd. is a wholly-owned subsidiary of the Company based in Singapore.During the year the turnover of the subsidiary was H378.19 crores and cost of sales wasH379.16 crores.
Internal Control System and Risk Management Framework
Section 177(4) of the Companies Act 2013 mandates Audit Committee to evaluate internalfinancial controls & risk management system of the Company. The Board has laid downthe procedure to inform the Board Members about the risk assessment and minimisation onperiodical basis.
The Internal Control System of the Company is commensurate with the size scale andcomplexity of its operations. These are constantly revised and strengthened. InternalAuditors carry out audit at regular intervals and submit their report to the AuditCommittee. Internal Audit plays a key role in providing an assurance to the Board andvalue adding advisory service to the business operations. Pursuant to Section 138 ofCompanies Act 2013 Jitendra Singh & Company have been appointed as Internal Auditorof the Company for the FY 2017-18.
Secretarial Audit Report
As required under Section 204 (1) of the Companies Act 2013 and Rule No.9 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s AdeshTandon & Associates has submitted its Secretarial Audit Report in prescribed format MR3 pertaining to the financial year ended 31st March 2017 to the Board and copy of the sameis attached as Annexure III to the Directors' Report.
The Board has duly reviewed the Secretarial Audit Report. The observations and commentsappearing in the Secretarial Auditor's Report are self-explanatory and following aremanagement's explanation/comments/clarification to the same :
a. The Cost Audit is in process and the report for the same to be filed soon.
b. The Company is in process of getting the details from the banks to transfer themoney to IEPF.
c. The observation of the Secretarial Auditors are only informative and need noexplanation.
d. The observation of the Secretarial Auditors are only informative and need noexplanation.
Disclosure on Establishment of a Vigil Mechanism
The Board has adopted the Vigil Mechanism (Whistle Blower Policy). Copy of the saidpolicy is available on the website of the Company www.jvlagro.com. This policy isformulated to provide a secure environment and to encourage the individuals to reportunethical unlawful or improper practices acts or activities that may be taking place inthe Company and to prohibit senior managerial personnel from taking any adverse actionagainst those individuals who report such practices in good faith. This policy is framedin accordance with the provisions of Section 177 of the Companies Act 2013 and SEBI(LODR) Regulations 2015 entered by the Company with stock exchanges. The Audit Committeeof the Company reviews the functioning of the Vigil Mechanism on regular basis.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the requirements set out by the Securities and Exchange Board of India. Asrequired by SEBI (LODR) Regulations 2015 a detailed report on Corporate Governance isseparately annexed to the Annual Report. The Statutory Auditor's certificate on compliancewith Corporate Governance requirements is attached to the Corporate Governance Report.
Also the declaration by CEO/CFO that the Board Members and SMPs have complied with theCode of Conduct is annexed with the Corporate Governance Report forming part of DirectorsReport.
System for Prevention of Sexual Harassment of Women at Workplace
The Company has in place the system for prevention of sexual harassment of women atworkplace in line with Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 notified by the Ministry of Women & Child Development. Thissystem prohibits prevents or deters the commission of acts of sexual harassment of womenat workplace and adequate procedures are in place for redressal of complaints pertainingto sexual harassment. The Internal Audit Committee of the Company is authorised toinvestigate the cases of sexual harassment of women at workplace.
During the year under review no complaints have been received from any of the womenemployees from any location or unit of the Company under Sexual Harassment of Women atWorkplace (Prevention Prohibition & Redressal) Act 2013.
Fraud Reporting (Required by Companies Amendment Bill 2014)
During the year under review no fraud was noted by the Audit Committee and/or the Boardhaving material impact on the Company & hence no reporting was made to the concernedauthority.
Management Discussion and Analysis Report
Management Discussion and Analysis Report for the year under review as stipulated underSEBI (LODR) Regulations 2015 is presented in a separate section forming part of theAnnual Report.
Corporate Social Responsibility (CSR) Policy
As required under Section 135 of Companies Act 2013 the Corporate SocialResponsibility Committee as a sub-committee of the Board was formulated during the year.The Committee comprises Mr. Mahesh Kedia Mr. S.N. Jhunjhunwala and Mr. AdarshJhunjhunwala. The Committee inter alia frames CSR policy for the Company and monitors& supervises the progress of Company in CSR initiatives as per the approved policydocument. The Company has been disclosed on the website of the company www.jvlagro. com.
The Committee met once during the year. There was no change in the composition of theCommittee during the year 2016-17 which is as follows:
|Name of the Member ||Category of Directorship ||Status In Committee |
|1 Mr. Mahesh Kedia ||NED/ID ||Chairman |
|2 Mr. S.N. Jhunjhunwala ||CEO/MD/PD/ED ||Member |
|3 Mr. Adarsh Jhunjhunwala ||WTD/PD/ED ||Member |
|4 Mr. Kartik Agrawal ||Company Secretary ||Secretary |
The details of initiatives undertaken on CSR activities during the year are set out inAnnexure IV of this report in the format prescribed in the Companies (Corporate SocialResponsibility) Policy Rules 2014.
Directors Responsibility Statement
In accordance with the provisions of Section 134(5) of the Companies Act 2013 yourdirectors confirm that:
a) in the preparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards had been followed along with proper explanationrelating 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 as at 31st March 2017 and of the profit/loss of the Company for that period;
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 on a going concern basis;
e) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively and thatsuch systems are adequate and operating.
f ) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
Number of Board Meetings
During the Financial Year 2016-17 Fourteen (14) meetings of the Board of Directors ofthe company were held. Details of which have been provided in the Corporate GovernanceReport forming part of this Annual Report.
Particulars of Loan Guarantees and Investments under Section 186
During the period under review your Company has not provided any loan guarantee &made investments u/s 186 of the Companies Act 2013.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential right as to dividend voting or otherwise
2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme of Employee Stock Options.
3. Neither the Managing Director nor the Whole Time Director is in receipt of anyremuneration/commission from the subsidiary of the Company.
4. The Company has neither received nor repaid any deposit during the year.
5. No significant or material order were passed by the Regulators or courts orTribunals which would impact the going concern status and Company's operations in future.
6. There was no change in nature of business.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed are provided in Annexure V to thisreport.
Particulars of Employees and Related Disclosures
None of the directors/employees of the Company were in receipt of remunerationexceeding the level as prescribed in Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.
The details pertaining to the composition of Audit Committee Corporate SocialResponsibility Committee Nomination & Remuneration Committee and Stakeholders'Relationship Committee are included in the Corporate Governance Report which forms part ofthe Annual Report.
The Directors express their sincere appreciation to the valued shareholders bankersand clients for their support
| ||For and on behalf of the Board of Directors |
|Place: Varanasi ||Satya Narayan Jhunjhunwala ||Adarsh Jhunjhunwala |
|Date: 28.08.2017 ||(Managing Director & CEO) ||(Whole Time Director) |