The Members of
KANANI INDUSTRIES LIMITED
Your Directors have pleasure in presenting their 34th Annual Report on theStandalone and Consolidated Audited Statement of Accounts of Kanani Industries Limited ["Company"]for the Financial Year ended March 31 2017.
The summarized financial performance of the Company for the FY 2016-17 and FY 2015-16is given below:
(Rs. in Lacs)
| ||Standalone ||Consolidated |
|Particulars ||2016-2017 ||2015-2016 ||2016-2017 ||2015-2016 |
|Gross Income ||8098.87 ||8525.61 ||44483.41 ||49637.38 |
|Profit Before Tax Interest and Depreciation ||155.66 ||51.74 ||191.55 ||248.89 |
|Finance Charges ||98.08 ||14.88 ||115.03 ||44.42 |
|Provision for Depreciation ||9.13 ||8.87 ||9.13 ||8.87 |
|Net Profit Before Tax ||48.45 ||42.87 ||67.39 ||210.49 |
|Provision for Tax ||9.25 ||8.18 ||16.98 ||19.08 |
|Previous year taxes ||0.12 ||- ||0.12 ||- |
|Net Profit After Tax ||39.08 ||34.69 ||50.29 ||191.41 |
|Balance of Profit brought forward ||2952.04 ||2940.98 ||3667.98 ||3500.20 |
|Balance available for appropriation ||2991.11 ||2952.04 ||3718.27 ||3667.98 |
|Proposed Dividend on Equity Shares ||- ||- ||- ||- |
|Tax on proposed Dividend ||- ||- ||- ||- |
|Transfer to General Reserve ||- ||- ||- ||- |
|Surplus carried to Balance Sheet ||39.08 ||34.69 ||50.29 ||191.41 |
REVIEW OF OPERATIONS
During the year under review the Standalone total Income was 8098.87 lacs asagainst 8525.61 lacs for the corresponding previous year.
The Standalone Net Profit after Tax for the year under review was 39.08 lacs asagainst Net Profit after Tax of 34.69 lacs in the corresponding previous yearConsolidated: During the year under review the consolidated total Income was 44483.41lacs as against 49637.38 lacs for the corresponding previous year.
The Standalone Net Profit after Tax for the year under review was 50.29 lacs asagainst Net Profit after Tax of 191.41 lacs in the corresponding previous year
The Jewellery business will continue its growth path through various initiativesincluding launching of new collections & Designs increasing share of studdedjewellery and achieving design leadership. Overall the year 2017-18 will be a year wherethe Company would drive for strong and profitable growth in all its consumer businesses.
DIVIDEND AND RESERVES
In order to conserve the resources for the further growth of the Company yourDirectors think fit not to recommend any dividend for the year under review.
The Paid-up Equity Share Capital of the Company as on 31st March 2017 is98934000/- comprising of 98934000/- shares of Re. 1/- each. During the year underreview the Company has not issued any equity shares.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
At the 33rd Annual General Meeting held on September 26 2016 Mr.Premjibhai Kanani was re-appointed as the Director of the Company liable to retire byrotation.
In accordance with section 152(6) of the Companies Act 2013 and in terms of Articlesof Association of the Company Mr. Harshil Kanani (DIN: 01568262) Director of the Companyretires by rotation and being eligible; offers himself for re-appointment at theforthcoming 34th Annual General Meeting. The Board recommends the saidreappointment for shareholders' approval.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) & 134(5) of the Companies Act 2013 the Board ofDirectors of the Company hereby confirm that:
(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
(b) the directors have 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 have 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 have prepared the annual accounts on a going concern basis; and
(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required pursuant to Section 197 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Amendment Rules 2016 in respect ofemployees of the Company is enclosed as Annexure I and forms part of thisReport.
Further as per the provisions specified in Chapter XIII of Companies (Appointment& Remuneration of Managerial Personnel) Amendment Rules 2016 none of the employees ofthe Company are in receipt of remuneration exceeding 10200000/- per annum if employedfor whole of the year or 850000/- per month if employed for part of the year.
Further the names of top ten employees in terms of remuneration drawn are disclosed inAnnexure II and forms part of this Report.
EXTRACT OF ANNUAL RETURN:
The details forming part of the Extract of the Annual Return in Form MGT-9 as requiredunder Section 92 of the Companies Act 2013 is included in this Report as AnnexureIII and forms part of this Report.
NUMBER OF BOARD MEETINGS
The intervening gap between the meetings was within the period prescribed under theCompanies Act 2013 and the Listing Agreement.
During the year 05 (Five) Board Meetings were held during the year ended March2017 the dates which are 25th April 2016 30th May 201610th August 2016 26th October 2016 and 10thFebruary 2017
|Name of the Directors ||No. of Board Meetings attended |
|Mr. Premjibhai Devjibhai Kanani ||5 |
|Mr. Harshil Premjibhai Kanani ||5 |
|Mr. Devendrakumar Karshanbhai Kikani ||5 |
|Ms. Ami Dhaval Jariwala ||5 |
|*Mr. Shailesh Patel ||2 |
*Resigned on 01/07/2016
Pursuant to the provisions of the Companies Act 2013 and the Listing Agreement/ SEBI(LODR) Regulations 2015 the Board has carried out an annual performance evaluation ofits own performance the directors individually as well as the evaluation of the workingof its Committees. The Directors expressed satisfaction with the evaluation process.
The Independent Director(s) have submitted their disclosure to the Board that theyfulfill all the requirements as to qualify for their appointment as Independent Directorunder the provisions of section 149 of the Companies Act 2013 as well as Regulation 17 ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES
The Statement AOC-1 pursuant to the provisions of Section 129 (3) of the Companies Act2013 read with Rule 5 of the Companies (Accounts) Rules 2014 regarding Subsidiary Companyis enclosed as Annexure IV to this Report.
STATUTORY AUDITORS' AND AUDITORS' REPORT
At the Annual General Meeting held on 26th September 2016 M/s. DeepakMehta & Associates Chartered Accountant were appointed as Statutory Auditors of theCompany to hold office till the conclusion of the Annual General Meeting to be held infinancial year 2021. In the terms of the first provision to Section 139 of the CompaniesAct 2013 the appointment of the Auditors shall be placed for ratification at everyAnnual General Meeting. Accordingly the appointment of M/s. Deepak Mehta &Associates Chartered Accountants as Statutory Auditors of the Company is placed forratification by the Shareholders. In regard to the Company has received a Certificate fromthe Auditors to the effect that if they are reappointed it would be in accordance withthe provisions of Section 141 of the Companies act 2013.
Auditors Report as issued by M/s. Deepak Mehta & Associates Chartered AccountantsAuditors of the Company is self explanatory and need not call for any explanation by yourBoard.
In terms of Section 204 of the Act and Rules made there under M/s. Deep Shukla &Associates Practicing Company Secretaries have been appointed Secretarial Auditors ofthe Company. The Secretarial Audit Report is enclosed as Annexure VI to thisreport.
EXPLANATION(S)/ COMMENT(S) PURSUANT TO SECTION 134(3)(f)(ii) IF ANY OF THE COMPANIESACT 2013:
The Company is in the process to file relevant eform(s) on MCA portal with respect toappointment of internal auditor and secretarial auditor.
INTERNAL AUDIT & CONTROLS
The Company has in place adequate internal financial controls with reference to thefinancial statement. The Audit Committee of the Board periodically reviews the internalcontrol systems with the management Internal Auditors and Statutory Auditors. Significantinternal audit findings are discussed and follow-ups are taken thereon.
Further M/s. Gosar Associates Chartered Accountants M.No.045010 were appointed asInternal Auditors of the Company pursuant to Section 138 of the companies act 2013.
COMPOSITION OF AUDIT COMMITTEE
Your Company has formed an Audit Committee as per the Companies Act 2013 and thelisting agreement. All members of the Audit Committee possess strong knowledge ofaccounting and financial management.
COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE
Your Company has formed a Nomination & Remuneration Committee to lay down norms fordetermination of remuneration of the executive as well as non-executive directors andexecutives at all levels of the Company. The Nomination & Remuneration committee hasbeen assigned to approve and settle the remuneration package with optimum blending ofmonetary and non-monetary outlay.
NOMINATION AND REMUNERATION POLICY
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors. This policy also lays down criteria for selection andappointment of Board Members. The Board of Directors is authorized to decide Remunerationto Executive Directors. The Remuneration structure comprises of Salary and Perquisites.Salary is paid to Executive Directors within the Salary grade approved by the Members. TheNomination & Remuneration committee has been assigned to approve and settle theremuneration package with optimum blending of monetary and non-monetary outlay.
In terms of requirements prescribed under Section 178(3) of the Companies Act 2013the Nomination and Remuneration Policy inter-alia providing the terms for appointment andpayment of remuneration to Directors and Key Managerial Personnel is annexed to thisReport as Annexure VII.
EMPLOYEES' STOCK OPTION PLAN
The Company has not provided stock options to any employee.
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company athttp://www.kananiindustries.com employees of the Company are made aware of the said policyat the time of joining the Company.
RISK MANAGEMENT POLICY
The Company has laid down the procedure to inform the Board about the risk assessmentand minimization procedures. These procedures are reviewed by the Board annually to ensurethat there is timely identification and assessment of risks measures to mitigate themand mechanisms for their proper and timely monitoring and reporting.
The Company does not fall under the ambit of top 100 listed entities determined on thebasis of market capitalisation as at the end of the immediately preceding financial year.Hence compliance under Regulation 21 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 is not applicable.
CORPORATE GOVERNANCE REPORT
In compliance with Regulation 34(3) read with Schedule V(C) of the Listing Regulationsa Report on Corporate Governance forms part of this Annual Report. The Auditors'certificate certifying compliance with the conditions of corporate governance asprescribed under Schedule V (E) of the Listing Regulations is annexed to the CorporateGovernance Report.
The Company has neither accepted nor renewed any fixed deposits during the year underreview under Section 76 of the Companies Act 2013. There are no unclaimed depositsunclaimed / unpaid interest refunds due to the deposit holders or to be deposited to theInvestor Education and Protection Fund as on March 31 2017.
LOANS & GUARANTEES
During the year under review the Company has not provided any loan guaranteesecurity or made any investment covered under the provisions of Section 186 of theCompanies Act 2013 to any person or other body corporate.
The properties/assets of the Company are adequately insured.
RELATED PARTY TRANSACTIONS
As no related party transaction was entered into by the Company with PromotersDirectors Key Managerial Personnel or other designated persons pursuant the provisions ofSection 188(1) of the Companies Act 2013 during the financial year 2016-17 theparticulars as required in form AOC-2 have not been furnished.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report which gives a detailed state of affairsof the Company's operations form a part of this Annual Report.
CONSERVATION OF ENERGY RESEARCH AND DEVELOPMENT TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE
The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows:
(a) Conservation of Energy:
Even though its operations are not energy-intensive significant measures are taken toreduce energy consumption by using energy-efficient equipment. The Company regularlyreviews power consumption patterns across all locations and implement requisiteimprovements/changes in the process in order to optimize energy/ power consumption andthereby achieve cost savings. Energy costs comprise a very small part of the Company'stotal cost of operations. However as a part of the Company's conservation of energyprogramme the management has appealed to all the employees/workers to conserve energy.
(b) Absorption of Technology:
I. The efforts made towards technology absorption:
The Company values innovation and applies it to every facet of its business. Thisdrives development of distinctive new products ever improving quality standards and moreefficient processes.
The Company has augmented its revenues and per unit price realization by deployinginnovative marketing strategies and offering exciting new products. The depth of designingcapabilities was the core to our success over the years.
The Company uses the service of in-house designers as well as those of free-lancers indeveloping product designs as per the emerging market trends. The Company uses innovationin design as well as in technology to develop new products.
II. Benefits derived as a result of the above efforts:
As a result of the above the following benefits have been achieved:
a) Better efficiency in operations
b) Reduced dependence on external sources for technology for developing new productsand upgrading existing products
c) Expansion of product range and cost reduction
d) Greater precision
e) Retention of existing customers and expansion of customer base
f) Lower inventory stocks resulting in low carrying costs.
III. The Company has not imported any technology during the year under review;
IV. The Company has not expended any expenditure towards Research and Developmentduring the year under review.
(c) Foreign Exchange Earnings and Outgo:
[Amt. in ]
|Particulars ||FY 2016-2017 ||FY 2015-2016 |
|C.I.F. Value of Imports ||844491497 ||833116436 |
|F.O.B. Value of Exports ||787246776 ||848791496 |
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
The Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).
|Unclaimed Dividend ||Amount (Rs.) |
|Unclaimed Dividend F.Y. 2008-09 - Interim || |
|Unclaimed Dividend F.Y. 2008-09 - Final || |
|Unclaimed Dividend F.Y. 2009-10 - Interim ||1807 |
|Unclaimed Dividend F.Y. 2009-10 - Final ||2308 |
Members are requested to note that after completion of seven years no claims shall lieagainst the said fund or company for the amounts of dividend so transferred nor shall anypayment be made in respect of such claims.
CORPORATE SOCIAL RESPONSIBILITY
The Company is committed to discharging its social responsibility as a good corporatecitizen.
The Board of Directors has framed a policy which lays down a framework in relation toCorporate Social Responsibility of the Company. This policy also lays down to lay downguidelines for the company to make CSR a key business process for sustainable developmentfor the Society. The details of this policy are explained by way of Annexure V.
During the year under review the Company has not expended any amount towards CSRactivities as the same is not applicable to the Company pursuant to section 135 of theCompanies Act 2013.
As per the Cost Audit Orders and in terms of the provisions of Section 148 and allother applicable provisions of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 Cost Audit is not applicable to our Company.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
In order to prevent sexual harassment of women at work place a new act The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9th December 2013. Under the said Act every company is required to setup an Internal Complaints Committee to look into complaints relating to sexual harassmentat work place of any women employee.
The Company has adopted a policy for prevention of Sexual Harassment of Women atworkplace and has set up Committee for implementation of said policy. During the yearCompany has not received any complaint of harassment.
LISTING WITH STOCK EXCHANGE:
The Company confirms that it has paid the Annual Listing Fees for the year 2017-2018 toBSE and NSE where the Company's Shares are listed.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There are no significant and material orders passed by the Regulators / Courts /Tribunals which would impact the going concern status of the Company and its futureoperations.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the company towhich the financial statements relate and the date of the report.
The Directors would like to thank all shareholders customers bankers suppliers andeverybody else with whose help cooperation and hard work the Company is able to achievethe results. The Directors would also like to place on record their appreciation of thededicated efforts put in by the employees of the Company.
| ||For and On behalf of the Board of Directors |
| ||PREMJIBHAI KANANI |
|Place: Mumbai ||CHAIRMAN |
|Date: August 21 2017 ||DIN : 01567443 |