Your Directors are pleased to present their Twentieth Annual Report on the business andoperations of the Company and the statement of accounts for the year ended March 312020
|Particulars ||2019-20 ||2018-19 |
|Dividend and Other Income ||4206.86 ||3750.38 |
|Profit before Interest Depreciation & Tax (PBIDT) ||4138.91 ||3699.95 |
|Less: Interest & Finance Charges (Net) ||103.36 ||103.36 |
|Gross Profit ||4035.55 ||3596.59 |
|Less: Depreciation and amortization charge ||3.76 ||0.75 |
|Profit before Tax (PBT) ||4031.79 ||3595.84 |
|Less: Provision for Taxes (including provision for deferred tax) ||(5.86) ||(73.56) |
|Net Profit after Tax (PAT) ||4037.65 ||3669.40 |
|Add: Profit brought forward from previous year ||29410.80 ||26709.50 |
|Surplus available for appropriation ||33448.45 ||30378.90 |
|Appropriations || || |
|Interim Dividend on Equity shares ||1935.78 ||967.89 |
|Corporate tax on dividend ||- ||- |
|Other comprehensive income arising from remeasurement of defined benefit obligation ||(0.32) ||(0.21) |
|Amount transferred to General Reserve ||- ||- |
|Profit carried to Balance Sheet ||31512.35 ||29410.80 |
|Total Appropriation ||33448.45 ||30378.90 |
During the year your Company has paid an interim dividend of Rs. 30 per equity shareamounting to Rs. 1935.78 Lakhs. No final dividend is recommended on Equity Shares.
Your Directors paid Interim dividend on 8% Noncumulative Redeemable Preference Sharesat 6% as
Interim Dividend and has recommended remaining 2% as final dividend.
Profit before Interest Depreciation & Tax (PBIDT) increased by 11.86% to Rs4138.91 lakhs during 201920 from Rs 3699.95 lakhs during 2018-19. Profit after Taxincreased by 10.03% to Rs. 4037.65 lakhs during 2019-20 from Rs 3669.40 lakhs during2018-19 mainly on account of increase in dividend income.
TRANSFER OF SHARES INTER-SE PROMOTERS
During the year 4839446 equity shares (75% of Equity Share Capital) held jointly byPromoters i.e. Mr. Arun Bharat Ram Mr. Ashish Bharat Ram and Mr. Kartik Bharat Ram havebeen gifted/settled in ABR Family Trust The Trustees are Mr. Arun Bharat Ram Mr. KartikBharat Ram and Mr. Ashish Bharat Ram. This was done in accordance with SEBI order datedDecember 9 2019 granting exemption to ABR Family Trust from complying with therequirements of Regulations 4 and 5(1) of the Takeover Regulations 2011
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
As on March 31 2020 your company had the following subsidiaries:-
1. SRF Limited is a subsidiary of the Company engaged primarily in the manufacture oftechnical textiles specialty chemicals fluorochemicals and packaging films. It has Sixwholly owned subsidiaries out of which one wholly owned subsidiary is registered in Indiaand remaining five are registered outside India. Two of these are direct wholly ownedsubsidiaries and the rest four are step down wholly owned subsidiaries of SRF Limited. Thedetails of the business of these subsidiaries is more particularly given in the AnnualReport of SRF Ltd. for 2019-20 which is available on the website www.srf.com
2. SRF Transnational Holdings Ltd. (SRFT) is a registered non deposit taking NBFCengaged in the business of investment in shares and securities.
3. Shri Educare Ltd. (SEL) is a company engaged in the business of rendering assistancefor establishing managing and running of the schools including sublicensing ofcopyrights trademarks and software.
4. Shri Educare Maldives Pvt. Ltd. (SEMPL) is managing a school in a public-privatepartnership with Maldives Government.
5. KAMA Realty (Delhi) Ltd. (KRDL) is a company engaged in acquisition and rental ofproperties.
6. KAMA Real Estate Holdings LLP (KREHL) is a limited liability partnership betweenKAMA Realty (Delhi) Ltd. and Shri Educare Ltd. It is engaged primarily in acquisition andrental of properties.
The consolidated profit and loss account for the period ended March 31 2020 includesthe profit and accounts for these twelve subsidiaries for the complete financial yearended March 31 2020
The consolidated financial statements of the Company prepared in compliance withapplicable Accounting Standards and other applicable laws including all the abovesubsidiaries duly audited by the statutory auditors are presented in the Annual Report.
No company has become/ceased to be a joint venture or associate during the year. Areport on performance and financial position of each of the subsidiaries and associates ispresented in a separate section in this Annual Report. Please refer (AOC-1) annexed to thefinancial statements in the Annual Report. The Policy for determining materialsubsidiaries as approved by the Board may be accessed on the Company's website at thelink: http://www.kamaholdings.com/Inv/Policy MaterialSubsidaryCompanies.pdf
The Company shall make available the annual accounts of the subsidiary companies to anymember of the Company who may be interested in obtaining the same. The annual accounts ofthe subsidiary companies will also be kept open for inspection at the registered office ofthe Company and respective subsidiary companies. Further the annual accounts of thesubsidiaries are also available on the website of the Company viz. www. kamaholdings.com.
DIRECTORS & KEY MANAGERIAL PERSONNEL
Mr. Ashish Bharat Ram (DIN: 00671567) is retiring at the forthcoming annual generalmeeting and being eligible offers himself for re-appointment.
Mr. Dhirendra Datta (DIN 02376649) Independent Director) had resigned with effect fromNovember 13 2019 due to preoccupation. There were no material reasons for hisresignation.
Further the Board had appointed Mr. Jagdeep Singh Rikhy (DIN 00944954) as anAdditional Director (NonExecutive Independent) in its meeting held on November 13 2019and has recommended the members to appoint him as Independent Director through ordinaryresolution for a term upto March 31 2024.
All the Independent Director(s) have submitted the declaration of meeting the criteriafor independence as provided in section 149 (6) of the Companies Act 2013 and ListingRegulations. They are also independent of the management.
The Board confirms that independent directors appointed during the year possess thedesired integrity expertise and experience. The independent directors as applicablehave been advised to undergo the Online Proficiency Test as prescribed under Companies(Appointment and Qualifications of Directors) Rules 2014 as amended.
Brief resumes of the directors who are proposed to be appointed/re-appointed are givenin the Notice of the 20th Annual General Meeting.
In accordance with the requirements of the Act and the Listing Regulations the Companyhas formulated a Nomination Appointment and Remuneration Policy. A copy of the Policy isenclosed as Annexure 1.
In accordance with the aforesaid Policy the Nomination and Remuneration Committee(NRC) evaluates the performance of the Executive Director Non- Independent non-executiveDirectors and Independent Directors. Board evaluates its own performance on criteria likedischarge of duties and responsibilities under the Companies Act 2013 ("theCompanies Act) and Listing Regulations fulfilment of its role with respect to guidingcorporate strategy risk policy business plans corporate performance monitoringcompany's governance practices etc. and number of meetings held during the year and theperformance of its Committees on the criteria like fulfilment of role of the Committeewith reference to its terms of reference the Companies Act and the Listing Regulationsand the number of committee meetings held during the year. Performance evaluation ofindividual Directors is done annually by the NRC as per the structure of performanceevaluation prescribed in the Nomination Appointment and Remuneration Policy.
NRC may subject to such approvals as may be applicable recommend to the Boardappropriate fees / commission to the non-executive directors for its approval. TheCommittee / Board shall inter alia consider level of remuneration /commission payable byother comparable companies time devoted experience providing guidance on strategicmatters and such other factors as it may deem fit.
The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company at the link.
http://www.kamaholdings.com/Inv/Familizaration Independent Directors.pdf
MEETINGS OF THE BOARD
During the year 2019-20 five meetings of the Board of Directors were held. For furtherdetails please refer to report on Corporate Governance on page no. 38 of this AnnualReport.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirements of Section 134 (3) (c) of the Companies Act 2013 it ishereby confirmed that :
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating 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 at the end of the financial year and ofthe profit and 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 this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis;
(e) the directors had laid down 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 provisionsof all applicable laws and that such systems were adequate and operating effectively.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts/ arrangements/ transactions entered into by the Company during thefinancial year with related parties referred to in sub-section (1) of section 188 werein the ordinary course of business and on an arms' length basis and in accordance with thebasis approved by the Audit Committee. During the year the Company has not entered intoany contract/ arrangement/ transaction with related parties which could be consideredmaterial in accordance with the Policy on materiality of related party transactions.
Your Directors draw attention of the members to Note 27 to the notes to accountsforming part of the financial statements which sets out related party transactiondisclosures.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE. GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given investments made guarantees given and securities providedalongwith the purpose for which the loan guarantee or security was proposed to beutilized by the recipient are provided in the standalone financial statement Please referNote 28 to the standalone financial statement).
BUSINESS RESPONSIBILITY REPORT
As stipulated under the Listing Regulations the Business Responsibility Reportdescribing the initiatives taken by the Company from an environmental social andgovernance perspective has been prepared for 2019-20 and forms a part of the Board'sReport.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
During the year 2019-20 the provisions of Section 135 of the Companies Act 2013 werenot applicable to the Company as the criteria for formation of CSR Committee laid down insection 135 (1) of the said Act were not met by the Company. Moreover the net profit ofthe Company consisted predominantly of dividend from SRF limited which is a subsidiary ofthe Company which is complying with the requirements of the said section. As per theCompanies (Corporate Social Responsibility Policy) Rules 2014 net profit for the purposeof the said section excludes any dividend income received from other companies in Indiawhich are covered under and complying with the provisions of Section 135 of the Act.
The Company is a Core Investment Company within the meaning of Core InvestmentCompanies (Reserve Bank) Directions 2011
Investment business is always prone to various risks i.e. risk of capital marketfluctuations global developments competition risk interest rate volatility economiccycles and political risks which can affect the fortunes of investment companies in bothways.
To manage these risks the Company is following a sound and prudent risk managementpolicy. The aim of the policy is to minimize risk and maximize the returns.
In the opinion of your Board none of the risks which have been identified maythreaten the existence of the Company.
The Company has a Risk Management Committee consisting of Mr. Ashish Bharat Ram asChairman Mr. Kartik Bharat Ram Director and Ms. Ekta Maheshwari Whole-time DirectorCFO & CS as members of the Committee.
INTERNAL FINANCIAL CONTROLS
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation of reliablefinancial disclosures.
LISTING OF EQUITY SHARES
KAMA's equity shares are listed at the BSE Limited.
DIVIDEND DISTRIBUTION POLICY
In compliance with the listing regulations your Board had formulated a DividendDistribution Policy. A copy of the said policy is available on the website of the companyat www.kamaholdings.com. The Policy is also given in Annexure II.
Certificate of the practicing Company Secretary regarding compliance of the conditionsof corporate governance as stipulated in Regulation 34(3) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is attached to the report as Annexure III.
In compliance with the requirements of Regulation 17(8) of the aforesaid Regulations acertificate from Whole Time Director CFO and Company Secretary was placed before theBoard.
All Board members affirmed compliance with the Code of Conduct for Board and SeniorManagement Personnel. A declaration to this effect duly signed by the Whole Time DirectorCFO and Company Secretary is enclosed as a part of the Corporate Governance Report. A copyof the Code is also placed at the website of the Company (www. kamaholdings.com).
CONSOLIDATED FINANCIAL STATEMENT
The consolidated financial statements of the Company have been prepared in accordancewith the Indian Accounting Standards (Ind AS) to comply with the Accounting Standardsspecified under Section 133 of the Companies Act 2013 read with Companies (IndianAccounting Standards) Rules 2015 and other relevant amendments issued thereafter of theAct.
The Audit Committee comprises of Independent Directors namely Mr. Amitav Virmani(Chairman of the Committee) Mrs. Ira Gupta and Mr. Jagdeep Singh Rikhy as other members.All the recommendations made by the Audit Committee were accepted by the Board.
ACCOUNTS AND AUDIT
M/s. Luthra & Luthra LLP Chartered Accountants New Delhi (Registration No.002081N/N500092) ("Luthra") were appointed as the Statutory Auditors of theCompany for 5 years on 17th Annual General Meeting to hold office from the conclusion of17th Annual General Meeting until the conclusion of the 22nd Annual General Meeting of theCompany. However Luthra tendered their resignation w.e.f August 10 2020 due to time gapbetween receipt of Company's material subsidiary's audited financial statements/ reviewedfinancial results and Company's Audit Committee meetings being very meagre resulting ininsufficient time available for audit of the consolidated financial statements/review theconsolidated financial results.
Based on the recommendation of the Audit Committee the Board of Directors of theCompany at its meeting held on August 10 2020 noted and accepted their resignation andhas appointed M/s V Sahai Tripathi & Co. (VST) Chartered Accountants (FirmRegistration No. 000262N) as statutory Auditors to fill the casual vacancy upto theensuing Annual General Meeting and has recommended to the members to appoint them asStatutory Auditors for a period of 5 years from the conclusion of ensuing 20th AnnualGeneral Meeting.
M/s V Sahai Tripathi & Co. (VST) Chartered Accountants (Firm Registration No.000262N) is a well known firm of Chartered Accountants based at New Delhi founded in1935. Over years it has become a multi service professional organisation with experiencein the area of Statutory Audits Internal Audits Bank Audits Company Law AdvisoryTaxation including International Taxation Financial Consultancy.
The Audit for FY 2019-20 and limited review for Q1 for FY 2020-21 was conducted byLuthra and there are no qualifications reservations adverse remarks or disclaimers madeby the Statutory Auditor in their Audit Report For FY 2019-20 and limited review reportfor Q1 for FY 2020-21. The Notes to the financial statements referred in the AuditorsReport are self-explanatory and therefore do not call for any comments under Section 134of the Companies Act 2013. The Auditors' Report is enclosed with the financial statementsin the Annual Report.
As per the requirement of section 148(1) and other applicable provisions of theCompanies Act 2013 Maintenance of Cost records is not applicable on the Company.
In compliance of provisions of the Companies Act 2013 and Listing Regulations thecompany has established a vigil mechanism for directors employees and other stakeholdersto report concerns about unethical behaviour actual or suspected fraud or violation ofthe company's code of conduct. The Vigil mechanism of the Company consists of Code ofConduct for Employees Whistleblower Policy Code of Conduct for Prevention of InsiderTrading and Code of Conduct for Directors and Sr. Management Personnel. These takentogether constitute the vigil mechanism through which Directors employees and otherstakeholders can voice their concerns. The Whistleblower Policy Code of Conduct forPrevention of Insider Trading and Code of Conduct for Directors and Sr. ManagementPersonnel can be accessed on the Company's website at the linkhttp://www.kamaholdings.com/InvCodesPolicies. aspx.
MANAGEMENT DISCUSSION AND ANALYSIS
Management discussion and analysis on matters as stipulated in Listing Regulations isgiven as a separate section in the Annual report.
The Board had appointed M/s Sanjay Grover & Associates Practicing CompanySecretary to conduct Secretarial Audit for the financial year 2019-20. The SecretarialAudit Report for the financial year ended March 31 2020 is annexed herewith as AnnexureIV to this Report. The Secretarial Audit Report does not contain any qualificationreservation or adverse remark.
Further Secretarial Compliance Report dated May 28 2020 issued as per SEBI CircularCIR/CFD/ CMD1/27/2019 dated February 08 2019 was given by M/s Sanjay Grover &Associates Practicing Company Secretary which was submitted to Stock Exchanges.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended a statement showing the names and other particulars of the employees drawingremuneration required to be disclosed under the said rules are provided in Annexure V.
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 as amended are provided in Annexure VI.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION. FOREIGN EXCHANGE EARNINGS & OUTGO
As the Company is not carrying out any manufacturing activity the disclosures asrequired under section 134(3)(m) of the Companies Act 2013 and rules made thereunder havenot been given. There is no foreign exchange earnings and outgo in the financial yearended March 31 2020.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure VII.
The Annual Return (MGT-7) of the Company as on March 31 2019 is available on thefollowing web link: www. kamaholdings.com
Applicable Secretarial Standards i.e. SS-1 SS-2 and SS- 3 relating to Meetingof the Board of Directors' General Meetings' and Dividend' respectively havebeen duly followed by the Company.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there was no transactions on these items during the year under review:-
1. Details relating to deposits covered under Chapter V of the Companies Act 2013.
2. Whole-time Director CFO and Company Secretary has not received any remuneration orcommission from any of the Company's subsidiaries.
3. 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.
During the year there were no complaints received under the Sexual Harassment of Womenat Workplace (Prevention prohibition and redressal ) Act 2013.
Your Directors acknowledge with gratitude the cooperation and assistance received fromvarious stakeholders and statutory agencies. Your Directors thank the shareholders fortheir support.
For and on behalf of the Board of Directors
| ||Kartik Bharat Ram |
| ||Chairman |
| ||(DIN 00008557) |
|New Delhi || |
|August 10 2020 || |