Your Directors hereby present their 33 Annual Report along with Audited FinancialStatements for the year ended March 31 2017.
|Particulars || |
Year Ended March 31 2017
Year Ended March 31 2016
|Revenue from Operations || || || || |
|Gross || ||48322.45 || ||35599.51 |
|Net of Excise Duty || ||42712.63 || ||31416.81 |
|Other Income || ||38.40 || ||89.34 |
|Profitbefore Fifinance Costs & || || || || |
|Depreciation and amortisation expense || ||1903.94 || ||2753.29 |
|Fifinance Costs || ||(105.05) || ||720.98 |
|Profitbefore Depreciation and || || || || |
|amortisation expense || ||2008.99 || ||2032.31 |
|Depreciation and amortisation expense || ||305.42 || ||293.93 |
|Profitbefore Tax || ||1703.57 || ||1738.38 |
|Tax expenses - Current Tax ||382.00 || ||201.11 || |
|- Deferred Tax ||138.09 ||520.09 ||457.32 ||658.43 |
|Profitafter Tax || ||1183.48 || ||1079.95 |
|Balance brought forward || ||(490.58) || ||(1570.53) |
|Surplus / (De cit) carried forward || ||692.90 || ||(490.58) |
Your Company reported a top-line grow of 35.74% over the Previous Year. The GrossRevenue from operations stood at
` 48322.45 lacs compared with ` 35599.51 lacs in the Previous Year. The OperatingProfitbefore tax stood at
` 1703.57 lacs as against ` 1738.38 lacs in the Previous Year. The Net Profitfor theyear stood at ` 1183.48 lacs against
` 1079.95 lacs reported in the Previous Year.
The company continues to retain and reinforce its market leadership in modifiedthermoplastics with a pan India network of operations having plants and warehousessituated in auto hubs and industrial belts.
There are no material changes or commitments affecting the financial position of theCompany which have occurred between the end of the financial year and the date of thisReport.
Detailed analysis of the Company's performance during the year is provided in Annexureto this report under Management's Discussion and Analysis Report.
Though the operations for the year have generated a profitt in view of the carryoverloss of the earlier years in the Profitand
Loss account your Directors regret that they are unable to recommend any dividend onthe Equity Share Capital for the year under review.
As on March 31 2017 the reserves and surplus stood at
` 12115.16 Lacs as compared to ` 10931.68 Lacs as on March 31 2016.
RIGHTS ISSUE OF EQUITY SHARES
The Company in order to augment resources for its long term funds requirement of theCompany has gone for Rights Issue of Equity Shares to finance the ongoing project ofSetting up of a new facility at Chakan Pune Upgradation of R & D facility at theexisting set-up at Puducherry Expansion of facility at the existing set-up at Puducherryand Manesar and to meet the additional working capital requirement.
The Rights Issue got opened on March 27 2017 and closed on April 10 2017. The Companyhad issued 1999893 equity shares of face value ` 10/- each for cash at issue price of
` 750/- per equity share including share premium of ` 740/- per equity share in theratio of 18 equity shares for every 91 equity shares held aggregating to ` 14999.20 Lacsto the existing Shareholders of the Company.
Consequent to the Rights Issue of Equity Shares the paid up equity capital of theCompany stood at ` 1211.05 lacs. The Company has not issued shares with differentialvoting rights nor granted stock options nor sweat equity.
LISTING OF COMPANY'S EQUITY SHARES ON NATIONAL STOCK EXCHANGE
Company Issued Equity Shares are admitted to dealing on the National Stock Exchange ofIndia Limited (NSE) in the Capital Market Segment with effect from November 15 2016consequent to an application made with NSE by the Company. The Symbol of the Company atNSE is KINGFA".
STATUS OF NEW MANUFACTURING FACILITY
The Company has taken over the possession of the Plot from Maharashtra IndustrialDevelopment Corporation and also signed the Lease Agreement of the said land situated atChakan Industrial Area in Pune for setting up a green eld manufacturing location whichwill be capable of housing the capacity expansion in the medium term future. The locationwould also house a State of Art "Technical and Product Development" Centre tomeet the grflowing needs of the Company.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees nor has made any Investments coveredunder the provisions of Section 186 of the Companies Act 2013.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board and tothe Managing Director.
The Internal Audit Department monitors and evaluates the ef cacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process flowners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
CORPORATE SOCIAL RESPONSIBILITY
As a part of its initiative under the "Corporate Social Responsibility" (CSR)drive the Company has undertaken projects which are in accordance with the Companies Act2013 and the Company's CSR policy. The Report on CSR activities as required under theCompanies (Corporate Social Responsibility Policy) Rules 2014 is annefixed as Annexure Iand forms an integral part of this Report.
ENVIRONMENT HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS 18001 certi cation.
Your Company's policy require the conduct of all operations in such a manner so as toensure safety of all concerned compliance of statutory and industrial requirements forenvironment protection and conservation of natural resources to the extent possible.
As required by the Sexual Harassment of Women at Workplace (Prevention Prohibition& Redressal) Act 2013 the Company has formulated and implemented a policy onprevention of sexual harassment at the workplace with a mechanism of lodging complaints.The Company has not received any compliant under this policy during the year under review.
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR policies to the grflowingrequirements of the business. Reviews training and tools are being provided for thepersonnel to improve overall ef ciency.
A. Changes in Directors and Key Managerial Personnel
Ms. Kamana Srikanth has resigned as Director from the Board with effect from 24thOctober 2016 due to her other occupations. The Board wishes to place on record itsappreciation of the valuable service rendered by her during her tenure in the Company.
The Board appointed Ms. Nilima Ramrao Shinde as an Additional Director(Non-Efixecutive Independent Woman Director) of the Company with effect from 1stNovember 2016 subject to the approval by the Shareholders at the ensuring Annual GeneralMeeting.
Your Director Mr.Wu Xiaohui retire by rotation and being eligible offers himself forre-appointment.
Your Directors have re-appointed Mr.Bo Jingen as Managing Director and Mr.Wu Xiaohui asWhole-time Director of the Company for a further period of Three years with effect from27th February 2017 at their Meeting held on 13th February 2017. The necessaryresolutions are being placed before the shareholders for their approval.
Mr.Nirnoy Sur was appointed as Company Secretary and Compliance Of cer of the Companywith effect from 24th October 2016 in the place of Mr.S.K.Subramanyan who has sincesuperannuated.
B. Declaration by an Independent Director(s)
All Independent Directors have given declarations that they meet the criteria ofindependence as laid dflown under Section 149(6) of the Companies Act 2013 read with SEBI(LODR) Regulations 2015.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
All new Independent Directors inducted into the Board are familiarized with theOrganisation. The details of such program are provided in Corporate Goverfinance Report.
NUMBER OF MEETINGS OF THE BOARD
The details of the number of Meetings of the Board held during the Financial Year 201617 forms part of the Corporate Goverfinance Report.
COMMITTEES OF THE BOARD
The details of the various Committees of the Board i.e. Audit Committee Nomination andRemuneration Committee Stakeholder Relationship Committee Corporate SocialResponsibility Committee and Rights Issue Committee held during the Financial Year 2016 17are provided in the Corporate Goverfinance Report.
Pursuant to the provisions of the Companies Act 2013 and SEBI (LODR) Regulations 2015the Board has carried out performance evaluation of its flown performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and other Committees as required. The manner in which the evaluation has beencarried out has been explained in the Corporate Goverfinance Report.
NOMINATION AND REMUNERATION POLICY
The Board of Directors has framed a policy which lays dflown a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.This policy also lays dflown criteria for selection and appointment of Board Members. Thedetails of this policy are explained in the Corporate Goverfinance Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of knflowledge and belief and according to the information and explanationsobtained by them your Directors make the follflowing statement in terms of Section134(3)(c) of the Companies Act 2013:
(i) that in the preparation of the Annual Accounts for the year ended 31st March 2017the applicable accounting standards have been follflowed along with proper explanationrelating to material departures;
(ii) the directors had selected such accounting policies and applied them consistentlyand made judgements 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 March 31 2017 and of the Profitandloss of the Company for the year ended on that date;
(iii) that the directors has taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) the annual accounts have been prepared on a "going concern" basis.
(v) that the directors had laid dflown internal financial controls to be follflowed bythe Company and that such internal financial controls are adequate and were operatingeffectively; and
(vi) that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such system were adequate and operatingeffectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. The Policy has beenuploaded on the website of the Company. Form AOC-2 is annefixed herewith as Annexure - IIand forms an integral part of this report.
The Company does not have subsidiary.
WHISTLE BLFLOWER POLICY AND VIGIL MECHANISM
In pursuant to the provisions of the Companies Act 2013 a Whistle Blflower Policy andVigil Mechanism for Directors and Employees to report genuine concerns has beenestablished. The Policy has been uploaded on the website of the Company.
PREVENTION OF INSIDER TRADING
Pursuant to SEBI (Prohibition of Insider Trading) Regulations 2015 the Company hasformulated and adopted a Code for Prevention of Insider Trading and the same has beenuploaded on the website of the Company.
Pursuant to the provisions of Section 139 of the Companies Act 2013 and Rules madethereunder the term of office of
M/s.P.Srinivasan & Co. as the Statutory Auditors of the Company will conclude fromthe close of ensuing Annual General Meeting of the Company.
The Board of Directors places on record its appreciation to the services rendered byM/s.P.Srinivasan & Co. as the Statutory Auditors of the Company. Subject to theapproval of the Members the Board of Directors of the Company has recommended theappointment of M/s. P.G.BHAGWAT Chartered Accountants (Firm Registration Number 101118W)as the Statutory Auditors of the Company pursuant to Section 139 of the Companies Act2013. The Company has received con rmation regarding their consent and eligibility undersections 139 and 141 of the Companies Act 2013 read with Companies (Accounts) Rules 2014for appointment as the auditors of the company. The Auditors have also con rmed that theyhold valid certi cate issued by the Peer Review Board of the Institute of CharteredAccountants of India. Accordingly the Board recommends the resolution in relation toappointment of Statutory Auditors for the approval by the shareholders of the Company.The necessary resolution is being placed before the shareholders for their approval. Thereis no audit quali cation for the year under review. As per the provisions of the CompaniesAct 2013 the Auditors Report forms part of Annual Report.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethereunder the Company had appointed M/s.Lakshmmi Subramanian & AssociatesPractising Company Secretaries to undertake the Secretarial Audit of the Company. TheSecretarial Audit Report is included as Annexure III and forms an integral part of thisReport. There is no secretarial audit quali cation for the year under review.
In compliance with the provisions of Section 148 of the Companies Act 2013 the Boardof Directors on the recommendation of Audit Committee has appointed Mr.K.SuryanarayananCost Accountant (Registration Number 102347) as Cost Auditor to audit the cost accounts ofthe Company for the financial year 2017-18. As required under the Companies Act 2013 aresolution seeking member's approval for the remuneration payable to the Cost Auditorforms part of the Notice convening the Annual General Meeting for their rati cation.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annefixedherewith as Annexure - IV.
BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within the Company. TheAssessment is periodically examined by the Board.
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 given in Annexure V to this Report.
The particulars of employees are not applicable since there are no employees drawingremuneration more than ` 9600000/- per annum (full year) or ` 800000/- p.m. (part ofthe year).
All the dividends of the earlier years which have remained unclaimed have since beentransferred to the Investor Education and Protection Fund at the expiry of the speci edperiod(s) as required under Companies Act. Details of dividends remaining unclaimed as on31.03.2017 are as under :
|Year ||Date of declaration ||No. of ||Total Unclaimed ||Due date for transfer to IEPF Account |
| || ||Shareholders Dividend (`) || |
|2009 2010 ||No Dividend declared || ||N.A. || |
|2010 - 2011 ||29.09.2011 ||729 ||60868.80 ||05.11.2018 |
|2011 2012 to 2015 - 2016 ||No Dividend declared || ||N.A. || |
CORPORATE GOVERFINANCE AND MANAGEMENT'S DISCUSSION & ANALYSIS REPORTS
The Corporate Goverfinance and Management's Discussion & Analysis Report whichform an integral part of this Report are set out as separate Annexures together with theCerti cate from the Auditors of the Company regarding compliance with the requirements ofCorporate Goverfinance as stipulated under various regulations of the SEBI (ListingObligations and disclosure requirements) Regulations 2015.
Your Directors wish to record their appreciation of the continued support andco-operation from your Company's customers vendors bankers and all other stakeholders.Your Company will continue to build and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism commitment anddedication displayed by employees at all levels. The Directors also place on record theirgratitude to the Members for their continued support and con dence.
For and on behalf of the Board of Directors
BO JINGEN N.K. RAMASWAMY
Managing Director Director
Place : Chennai Date : 31st July 2017