Your Directors are pleased to present the Twenty Fifth Annual Report on the businessand operations of the Company together with the Audited Financial Statements for the yearended March 31 2018.
The Company's financial performance for the year ended 31st March 2018 is summarisedbelow. Segment wise reporting as per Accounting Standards AS-17 is not applicable to yourCompany since your Company is engaged in the activity of single segment only
|Particulars ||Year ended 31.03.2018 ||Year ended 31.03.2017 |
| ||(Rs. in Lakhs) ||(Rs. in Lakhs) |
|Revenue from operations ||11707.14 ||6607.34 |
|Other income ||71.58 ||68.50 |
|Total Expenses ||9471.97 ||6206.10 |
|Cost of Material Consumed ||7845.87 ||4413.03 |
|Depreciation and amortization expenses ||84.63 ||63.47 |
|Finance Cost ||145.13 ||186.06 |
|Other Expenses ||837.65 ||650.71 |
|Profit / Loss Before tax ||2306.75 ||469.74 |
|Current tax ||788.73 ||166.45 |
|Profit / Loss After tax ||1518.03 ||303.29 |
|Earnings per share || || |
|Basic & Diluted ||36.65 ||7.32 |
|Your Directors recommend the following appropriations:- || || |
|Proposed Dividend ||- ||62.13 |
|Dividend Distribution Tax ||- ||12.65 |
|Transfer to general Reserve ||- ||- |
The Gross Revenue from operations for FY 2018 was at Rs.11707.14 Lakhs/- (PreviousYear Rs.6607.34 Lakhs/-) registering a growth of 44%. The Profit after tax stood atRs.1518.02 Lakhs/- (Previous Year Rs.303.29 Lakhs/-).
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 annexed as Annexure -1 to this Report.
DIVIDEND AND TRANSFER TO RESERVES IN TERMS OF SECTION 134 (3) (J) & (k) OF THECOMPANIES ACT 2013
Your Directors recommend a dividend of 20 % (Twenty percent) i.e. Rs.2.00/- per equityshare of face value of Rs.10/- each (Previous Year 15%). Payment of Dividend is subject tothe approval of Shareholders at the ensuing Annual General Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:
i. in the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures;
ii. 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 as at 31st March 2018 and of the profitof the Company for the year ended on that date;
iii. the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv. the Directors have prepared the annual accounts on a going concern basis;
v. The Directors have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and operating effectively;
vi. The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
The paid up Equity Share Capital as at March 31 2018 stood at Rs.41422000/-. Duringthe year under review the company has not issued shares with differential voting rightsnor has granted any stock options or sweat equity. As on March 31 2018 none of theDirectors of the company hold instruments convertible into equity shares of the Company
INFORMATION ABOUT HOLDING / SUBSIDIARY/ JV/ ASSOCIATE COMPANY
The Company does not have any Holding Subsidiary Joint venture or Associate Company.
The Board of Directors of the company comprises of One Managing Director TwoWhole-time Directors who are the Promoters of the company and Four Non-ExecutiveDirectors including Three Independent Directors. The Company also has One Women Directorwho is Non Executive. The composition of the Board of Directors is in compliance withSection 149 of the Companies Act 2013.
In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Mrs. Pushpa S Jain (DIN:06939054) Non ExecutiveDirector retires by rotation at the forthcoming Annual General Meeting and beingeligible offers herself for re-appointment. The Board recommends her reappointment forthe consideration of the Members of the Company at the ensuing Annual General Meeting.
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 Regulation16 (b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
NUMBER OF MEETINGS OF THE BOARD
During the year 9 (nine) meetings of the Board of Directors were held. The details ofthe meetings are furnished in the Corporate Governance Report which is attached to thisreport.
KEY MANAGERIAL PERSONNEL
The following are the Key Managerial Personnel of the Company:
a) Mr. Suresh Shah (DIN: 01659809) Managing Director
b) Mr. Dipesh S Jain (DIN: 01659930) Whole Time Director
c) Mr. Arun V Shah (DIN: 01744884) Whole Time Director
d) Mr. K. C. Radhakrishnan Chief Financial Officer
e) Ms. A.Priyanka Company Secretary
COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders' Relationship Committee
4. CSR Committee
The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.
(a) STATUTORY AUDITOR
Pursuant to the Provisions of Sections 139 141& 142 of the Companies Act 2013("the Act") the Companies (Audit and Auditors) Rules 2014 ("theRules") Schedules attached thereto (including any statutory modification(s) orenactment(s) or re-enactment(s) thereof for the time being in force) pursuant to therecommendation of Audit Committee of the Company and that of the Board and pursuant to theapproval of Members at the Twenty fourth Annual General Meeting held on September 282017 consent of the Members of the Company is be and hereby accorded to appoint M/s. P.Chandrasekar LLP Chartered Accountants Bangalore(Firm Registration Number:000580S/S200066) as Statutory Auditors of the Company to hold office as StatutoryAuditors from the conclusion of Twenty fourth Annual General Meeting till the conclusionof Twenty ninth Annual General Meeting.
There is no audit qualification for the year under review.
(b) COST AUDITOR
The Company's products come under Table B (Non Regulated Sector) Companies (CostRecords and Audit) Rules 2014. As per Rule 4 Companies (Cost Records and Audit) Rules2014 Every Company specified in Table B of the Cost Audit would be applicable if theoverall turnover of the Company from all its products and services during the immediatelypreceding financial year is Rs.100 Crores or more and the aggregate turnover of theindividual product(s) or Service(s) for which cost records are required to be maintainedunder Rule 3 is Rs.35 Crores or more.
Hence M/s. N. Sivashankaran& Co. Cost Accountants appointed as Cost Auditors bythe Board of Directors to audit the cost records of the Company for the FY 2017-18.
(c) SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethere under the Company has appointed M/s. P. Sriram & Associates PracticingCompany Secretaries to undertake the Secretarial Audit of the Company. The SecretarialAudit Report is annexed as Annexure-2 to this Report.
There is no secretarial audit qualification for the year under review.
(d) INTERNAL AUDITOR
Pursuant to the provisions of Section 138 of the Companies Act 2013 and rules madethere under the Company has appointed M/s. R. Subramanian and Co. LLP CharteredAccountants to undertake the Internal Audit of the Company.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Your Company has not given any loan or made any investment or given a guarantee orprovided any security in accordance with Section 186 of the Companies Act 2013.
PARTICULARS OF CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All transactions entered with Related Parties for the year under review were on arm'slength basis
All related party transactions are placed before the Audit Committee for approval.Details of the transactions are provided in form AOC-2 in terms of Section 134 of theCompanies Act 2013 is appended as Annexure-3 to this Report.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting the financial position of theCompany between the end of the financial year (31st March 2018) and the date of the report.
CORPORATE SOCIAL RESPONSIBILITY
The Company does meet the provisions laid down in Section 135 of the Companies Act2013 read with Companies (Corporate Social Responsibility Policy) Rules 2014 hence theCompany has constituted a Corporate Social Responsibility Committee.
DEPOSITS FROM PUBLIC
During the year under review your company did not accept any deposits within themeaning of provisions of Chapter V Acceptance of Deposits by the Companies Act 2013 readwith the Companies (Acceptance of Deposits) Rules 2014.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Your Company has internal control system which includes financial control commensuratewith the size scale and complexity of company's operations and also ensures that theCompany's assets are well protected. The internal audit evaluates the efficacy andadequacy of internal control system in the Company its compliance with accountingprocedures and policies of the Company. The Audit Committee of the Board of Directorsactively reviews the adequacy and effectiveness of the internal control systems andsuggests improvements to strengthen the same.
The Company is not only committed to maintain the standards of Corporate Governance setout by SEBI but also morally committed to its members. As per Regulation 34 (3) read withSchedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 a separate section on corporate governance practices followed by the Companytogether with a certificate from the Company's Auditors confirming compliance forms anintegral part of this Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy to report genuine concerns or grievances. Yourcompany hereby affirms that no complaints were received during the year.
Pursuant to the provisions of the Companies Act 2013 and the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 a structured questionnaire was preparedafter taking into consideration the various aspects of the Board's functioningcomposition of the Board and its Committees culture execution and performance ofspecific duties obligations and governance. The performance evaluation of the IndependentDirectors was completed. The performance evaluation of the Managing Director and theNon-Independent Directors was carried out by the Independent Directors. The Board ofDirectors expressed their satisfaction with the evaluation process.
The criteria for performance evaluation have been detailed in the Corporate GovernanceReport.
REMUNERATION AND NOMINATION POLICY
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays down criteria for selection and appointment of Board Members. Thedetails of this policy are explained in the Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of the Company asrequired under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isprovided in a separate section and forms a part of this Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/ Courts thatwould impact the going concern status of the Company and its future operations.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read with theRule 8(3) of the Companies (Accounts) Rules 2014 is annexed as Annexure-4 and forms apart of this Report
Your Company as part of Standard Operating System and Procedure institutionalized riskmanagement covering risk identification mitigation and management measures. This RiskCharter and Policy have been brought to practice as per part of internal control systemsand procedures. The Management has applied the risk management policy to activities andprocesses of the business and this is reviewed to ensure that executive management managesrisk through means of a properly defined framework.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT : NIL
DISLCOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
Your Company has zero tolerance for sexual harassment at workplace and has adopted apolicy and implemented an effective mechanism for the prevention prohibition andredressal of sexual harassment at workplace in line with the provisions of the SexualHarassment of Women at Workplace (Prevention Prohibition & Redressal) Act 2013 theCompany has formulated and implemented a policy on prevention of sexual harassment at theworkplace with a mechanism of lodging complaints. During the year under review nocomplaints were received by the Board.
PARTICULARS OF EMPLOYEES
The Disclosure required under Section 197(12) of the Companies Act 2013 read with theRule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 relating to the ratio of remuneration of each director to the median employee'sremuneration is annexed as Annexure-5 to this Report.
APPRECIATIONS AND ACKNOWLEDGMENTS
Your Directors place on record their appreciation to employees at all levels for theirdedication and commitment. Your Directors would also like to express their sincereappreciation for the assistance and co-operation received from the banks financialinstitutions Government Authorities customers vendors and members during the year underreview
| || ||For & on Behalf of the Board |
| || ||ForKANCHI KARPOORAM LIMITED |
| ||Dipesh S Jain ||Suresh V Shah |
|Place: Chennai ||(DIN: 01659930) ||(DIN: 01659809) |
|Date: 14.08.2018 ||Whole-time Director ||Managing Director |