On behalf of the Board of Directors it is our pleasure to present the 32nd AnnualReport together with the Audited Statement of Accounts of Kkalpana Industries (India)Limited ("the Company") for the year ended March 31 2017.
Summarized Financial Results
(Rs. In Lacs)
| ||Standalone ||2016-17 |
| ||2016-2017 ||2015-2016 ||Consolidated* |
|Net Turnover and other Income ||195726.5 ||187657.88 ||195726.5 |
|Proit before Depreciation Interest & Tax ||9489.63 ||10925.19 ||9486.51 |
|Less : Depreciation ||1313.76 ||1448.92 ||1313.76 |
|Interest ||4438.73 ||5104.62 ||4438.73 |
|Proit before Tax ||3737.14 ||4371.65 ||3734.02 |
|Less: Exceptional Item || ||2668.98 || |
|Less : Provision for Tax ||1163.09 ||563.32 ||1163.09 |
|Proit After Tax ||2574.04 ||1139.35 ||2570.93 |
|Add: Proit brought forward from previous year. ||12980.23 ||11840.90 ||12980.23 |
|Less: Impact of depreciation as per schedule II of Companies Act 2013 ||0 ||0 ||0 |
|Amount Available for Appropriation ||15554.29 ||12980.23 ||15551.16 |
|Appropriation || || || |
|Proposed inal dividend on Equity Shares ||0 ||0 || |
|Corporate Dividend Tax ||0 ||0 || |
|Transfer to General Reserve ||0 ||0 || |
|Surplus carried to Balance Sheet ||15554.29 ||12980.23 ||15551.16 |
* M/s. Plastic Processors & Exporter Private Limited has become a Subsidiary ofyour Company during the inancial year under review. As per AS 21 issued by ICAI if on theirst occasion that Consolidated Financial Statements are presented comparative igures forthe previous period need not be presented.
Indian Accounting Standards
The Ministry of Corporate Affairs (MCA) vide its notiication in the Oficial Gazettedated 16th Febr uary 2015 notiied the Indian Accounting Standards (Ind AS) applicable tocertain classes of companies. IndAS h as replaced the existing Indian GAAP prescribedunder Section 133 of the Companies Act 2013 read with Rule 7 of Companies (Accounts)Rules 2014. For your Company Ind AS is applicable from 1st April 2017.
Goods and Service Tax
Your Company has been preparing for migrating to GST. Changes across IT systems supplychain and operations have been made keeping in mind the sweeping changes that GST wouldbring in. While there are few areas that need to be addressed the Government hasannounced an intention to go live on GST w.e.f. 01st July 2017 and your company will beready for this transformative reform.
Taking into consideration increased working capital requirement and expectedsubstantial increase in operation in the year 2017-18 your directors do not recommend anydividend in respect of inancial year ended31st March 2017.
Operations and State of Companys Affairs
During the year under review your Company achieved total revenue of Rs. 1957.26 Croresas against total revenue of Rs. 1876.58 Crores in the previous inancial year. The Proitafter Tax is Rs. 25.74 Crores as agai nst Rs. 11.39 Crores in the previous year.
The Companys production and sales have recorded a signiicant growth over theprevious year. Higher level of Capacity Utilisation backed by strong volume growthtighter cost control geared the Company to register notable performance for the year.
Transfer of Amount to Investor Education and Protection Fund
Dividend for the inancial year ended 31st March 2010 which remains unpaid orunclaimed for a period of seven years will be due for transfer to Investor Education andProtection Fund (IEPF) on 5th November 2017. Members who have not yet enchased theirdividend warrants for the inancial year ended 31st March 2010 or any subsequent inancialyears are requested to lodge their claims without any delay.
Pursuant to the provisions of the Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has already iled the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company as on the date of last AGM (i.e.29.09.2016)with the Ministry of Corporate Affairs.
Your Company did not invite or accept any deposits from public and /or shareholdersduring the year under review.
As of 31st March 2017 there were no unpaid ixed deposits with the Company.
Transfer to General Reserve
The Company proposes not to transfer any funds out of its total proit of 25.74 Crorefor the inancial year to the
Research and Development
Your Company recognizes that Research & Development plays a critical role insupporting current operations as well as future growth. Your Company has focused itsattention on development of Products that have wide industrial applications particularlyin cable piping packaging and footwear industries.
Directors and Key Managerial Personnel
Shri Nirmalendu Guha ceased to be a Director on the Board due to his sudden demise on23rd April 2017. The Board of Directors places on record its sincere appreciation of thevaluable contributions made by him during his tenure of office.In accordance with theprovisions of Section 152 of the Companies Act 2013 Dr. Pranab Ranjan Mukherjee (DIN-00240758) Whole Time Director (Technical) of the Company retires by rotation at theforthcoming Annual General Meeting and being eligible has offered himself forre-appointment.
Further the Board on recommendation of Nomination & Remuneration Committeeapproved the reappointment of Mr. Narrindra Suranna as Managing Director for a period ofive years w.e.f 01st August 2017 andalso the reappointment of Dr. Pranab Ranjan Mukherjeeas Whole Time Director (Technical) for a period of one year w.e.f 01st October 2017subject to the approval of the members. Accordingly approval of the members is sought forreappointments of Mr. Narrindra Suranna and Dr. Pranab Ranjan Mukherjee at the forthcomingAGM.
The Board pursuant to the recommendation of Nomination and Remuneration Committee atits meeting held on 30th May 2017 approved the resignation of Mr. A.B. ChakrabartyCompany Secretary of the Company w.e.f. 01st June 2017 and appointed Ms. Tanvi Panday(ACS-31176) as the Company Secretary and Compliance Officer of the Company w.e.f. 01stJune 2017.
None of the Independent Directors are due for reappointment.
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. Corporate Social Responsibility Committee
The details of the Committees along with their composition number of meetings andattendance at the meeting are provided in the Corporate Governance Report.
Declaration by Independent Directors
The Company has received necessary declarations from each independent Director of theCompany pursuant to provisions of Section 149(7) conirming that they meet the criteriaof Independence as prescribed both under Section 149(6) of the Companies Act2013 andRegulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
Familiarization Programme for Independent Directors
The Company has organized a familiarization programme for the Independent Directors asper the requirement of the Companies Act2013 and Regulation 25(7) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. All new independent directorsinducted into the Board attend the orientation programme. Further at the time of theappointment of an Independent Director the company issues a formal letter of appointmentoutlining his/her role function duties and responsibilities. The format of the letter ofappointment is available under the head draft letter of appointment on our website(www.kkalpanagroup.com/investor-relations.php)
Policy on Directors appointment and remuneration
The current policy is to have an appropriate mix of executive and independent directorsto maintain the independence of the Board and separate its functions of governance andmanagement. As of 31st March 2017 the Board had 6 members 3 of whom were executive and3 were independent directors.
The Companys Policy for selection and appointment of Directors and theirremuneration is based on its NRC policy which inter alia deals with the manner ofselection of the Directors and such other matters as provided under section 178(3) of theAct and 19(4) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.The policy of the Company on directors appointment and remuneration including thecriteria for determining qualiications positive attributes independence of a directorand other matters as required undersection 178(3) of Companies Act 2013 is available onour website under the head Policy at www.kkalpanagroup.com/investor-relations.php.
There has been no change in the policy since last iscal. We afirm that the remunerationpaid todirectors is as the per the terms laid out in the Nomination and RemunerationPolicy of the Company.
The Board met Six times during the inancial year under review the details of which aregiven in the Corporate
Governance Report which is annexed and forms a part of this report. The intervening gapbetween two consecutive Meetings was within the period prescribed under the Companies Act2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
Directors Responsibility Statement
Pursuant to the requirement clause (c) of sub-section (3) of Section 134 of theCompanies Act 2013 your Directors conirm 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 inancial year and ofthe proit and loss of the company for that period;
(c) the directors had taken proper and suficient care for the maintenance of adequateaccounting rec ords 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; and
(e) the directors had laid down internal inancial controls to be followed by thecompany and that such internal inancial 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.
Auditors & Audit
The Statutory Auditors of the Company M/s.B.Mukherjee & Co Chartered AccountantsKolkata (Firm Registration
No.302096E) retire at the ensuing Annual General Meeting and have conirmed theireligibility and willingness to accept office if appointed. The Audit Committee and theBoard of Directors recommends the appointment of M/s. B.Mukherjee & Co. Charteredaccountants as the Auditors of the Company for a continuous period of5 (ive) yearssubject to ratiication by the shareholders at every subsequent Annual General Meeting.
Further the Auditors have conirmed that they have undergone the peer review process ofthe Institute of Chartered Accountants of India (ICAI) and hold a valid certiicate issuedby the Peer Review Board of ICAI. The observations of the Auditors in theReport on Accounts read with the relevant notes are self-explanatory and do not call forany further comments.
The Board of Directors of your Company has re-appointed M/s. DKD&AssociatesChartered Accountants Kolkata (Firm Registration No.322657E) as InternalAuditors pursuant to the provisions of Section 138 of the Companies Act 2013 for theinancial year 2017-2018.
Pursuant to section 148 of the Companies Act2013 and subject to notiication of rulesthereunder th e board of directors on the recommendation of the audit committee hasappointed M/s. D. Sabyasachi& Co. (Membership N0. 00369) Cost Accountants Kolkataas the Cost Auditors of the Company for the inancial year 2017-18. M/s. D. Sabyasachi&Co. have conirmed that their appointment is within the prescribed limits and they are eefrom any fr disqualiications as provided in section 141 of the Companies Act 2013.
The Board had appointed Mr. Ashok Kumar Daga (Membership No.-FCS- 2699) PracticingCompany Secretary to conduct Secretarial Audit for the Financial Year 2016-17. The reportof the Secretarial Auditors for the Financial Year 2016-17 in Form MR-3 is annexedherewith as Annexure 1 to this report. The report is self-explanatory and does not callfor any further comments.
The SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 mandatedthe formulation of certain policies for all listed companies. All applicable policies areavailable under the head Policy on the Companyswebsite:www.kkkalpanagroup.com/investor-relations.php. The policies are reviewedperiodically by the Board and updated based on need and new compliance requirement.
Corporate Social Responsibility (CSR)
The Company has a Corporate Social Responsibility Committee constitution of which isdetailed in the Corporate Governance Report forming part of this Report. In compliancewith Section 135 of the Companies Act 2013 read with Companies (Corporate SocialResponsibility Policy) Rules 2014 the Company has adopted a CSR policy which isavailable under the head policy at: http://www.kkalpanagroup.com/investor-relations.php.The Annual Report on CSR expenditures for the FY 2016-17 is annexed herewith and formspart of this report and marked as Annexure - 2.
Related party transactions
Your Company has formulated Policy on Related Party Transaction (RTP) which isavailable on Companys website www.kkalpanagroup.com. There were no transactionsentered with related parties for the year under review. Thus disclosure required undersection 134(3)(h) of the Act in Form AOC-2 is not applicable to your Company. Furtherthere are no material related party transactions during the year under review with thePromoters Directors or Key managerial Personnel.
Subsidiaries/ Joint Ventures / Associate Companies
M/s. Plastic Processors & Exporter Private Limited has become a Subsidiary of theCompany during the inancial year under review. Your Company has one Associate company.Theinancial position of these two companies is given in Form AOC- 1 and forms part of thereport as Annexure 3.
Performance of Subsidiaries Associates and Joint Venture Companies and theircontribution to the overall performance of the Company during the period
M/s Plastic Processors and Exporter Private Limited became subsidiary of your companyin the last quarter of 2016-17. There was no operation and hence its performance has notbeen detailed herein.
The operations of the associate company M/s Kkalpana Plastick Limited remainedsuspended for the entire Financial Year 2016-17 and therefore its performance has notbeen detailed herein.
Change in nature of Business if any
There has been no change in the nature of business of the Company. Your Companycontinues to be one of the leading manufacturers of Polymer compound in the Country.
Material changes and commitments affecting the inancial position of the Company
There have been no material changes and commitments affecting the inancial position ofthe Company between the end of the inancial year to which the inancial statements relateand the date of the report.
Particulars of Loans Guarantees and Investments
The Company has not given loans guarantees or made investments exceeding sixty percent of the aggregate of its paid-up share capital free reserves and securities premiumaccount or one hundred per cent of its free reserves and securities premium accountwhichever is more as prescribed in Section 186 of the Companies Act 2013.
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are provided in the inancial statement (please refer toNote 12 and 13 to the inancial statement).
Risk Management Policy
In terms of the requirement of the Act the Company has developed and implemented theRisk Management Policy and the Audit Committee of the Board reviews the same periodically.
Signiicant and material orders passed by the regulators
During the year under review no signiicant and material orders were passed by theregulators or courts or tribunals impacting the going concern status and thecompanys operations.
Disclosure as per Sexual Harassment of Women at workplace (Prevention Prohibition andRedressal) Act 2013.
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of Sexual Harassment of Women at workplace (Prevention Prohibitionand Redressal) Act 2013 and the rules framed thereunder.
Committee has been setup to redress complaints received regarding sexual harassment andall employees are covered under this policy. During the inancial year 2016-17 nocomplaint of sexual harassment has een received b by the Company.
The Company has devised a policy for performance evaluation of Independent Directorsand the Board which includes criteria for performance evaluation of the non-executive andexecutive Directors.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the formal annual evaluation was carried outfor the Boards own performance its committees& Individual Directors.
A structured questionnaire was prepared after taking into consideration inputs receivedfrom the Directors covering various aspects of the Boards functioning includingadequacy of the composition of the Board and its Committees Board culture execution andperformance of speciic duties obligations and governance.
A separate exercise was carried out for the evaluation of individual Directors (bothExecutive and Non executive/ Independent Directors) Board Committees and theChairman. The Directors evaluation was broadly based on parameters such as meeting theexpectation of stakeholders guidance and review of corporate strategy risksparticipation and attendance at Board / Committee meetings interpersonal skills. Theperformance evaluation of the Chairman of the Company was undertaken by the IndependentDirectors taking into account the views of Executive Directors and Non ExecutiveDirectors. The Independent Directors also assessed the quality quantity and timeliness oflow of information between the Companys management and the Board. Thedirectorsxpressed overall satisfaction on the evaluation process. Based on the feedback ofthe Board Evaluation Process appropriate measures were taken to further improve theprocess and other aspects.
Particulars of Employees
None of the employees employed during the yearwas in receipt of remuneration inaggregate of Rupees 10200000 or more per annum for the inancial year 2016-17 or Rs.850000 or more per month ny part of the for a Financial Year as set out in theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Thereforeno such details have been provided or required under section 197(12) of the Companies Act2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014. The ratio of remuneration of each Director to themedian employees remuneration and other details in accordance with sub-section 12 ofSection 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 as amended forms part of this report and is markedas Annexure 4
Extract of Annual Return
Pursuant to the provisions of section 92(3) and 134(3)(a) of the Companies Act 2013(the Act) and rule 12(1) of the Companies (Management and Administration)Rules 2014 extract of annual return is annexed and is marked as Annexure 5.
Pursuant to the requirement of the Section 177(9) of the Companies Act 2013 theCompany has established vigil mechanism which also incorporates a whistle blower policy interms of the SEBI Listing Regulations. Protected disclosures can be made by a whistleblower through an e mail or phone or letter to the chairman of Audit Committee.
Internal inancial controls
The internal inancial controls with reference to the Financial Statements arecommensurate with the size and nature of business of the Company.
Green Initiatives in Corporate Governance
Ministry of Corporate Affairs has permitted companies to send electronic copies ofAnnual Report notices etc. to the registered E-mail addresses of shareholders. YourCompany has accordingly arranged to send the electronic copies of these documents toshareholders whose email addresses are registered with the Company/ DepositoryParticipant(s) wherever applicable. In case any shareholder would like to receivephysical copies of these documents the same shall be forwarded upon receipt of writtenrequest from the shareholder. For members who have not registered their e-mail addressesphysical copies are sent in permitted mode.
Human Resources and Industrial Relations
The Industrial relations of the Company with its personnel has continued to be cordialand amicable. Your Directors acknowledge and appreciate the efforts and dedication ofemployees to the Company. Your directors wish to place on record the co-operation receivedfrom the Staff and Workers at all levels and at all units.
Particulars of Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo.
Your Company has directed its efforts to reduce energy costs by focusing on energysavings through the best optimization of operations on day to day basis. The Company hasused fuels in appropriate mix to attain maximum savings.
As required under Companies (Accounts) Rules 2014 the particulars of energyconservation Technology Absorption and Foreign Exchange Earnings and outgo is given inthe prescribed format as an Annexure to the Report and marked as Annexure - 6.
Managements Discussion and Analysis Report
In accordance with Regulation 34 (e) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Managements Discussion and Analysis Report forthe year under review is presented in a separate section forming part of the AnnualReport and marked as Annexure - 7.
The Company is committed to good corporate governance practices. The report onCorporate Governance for the inancial year ended March 31 2017 as per regulation 34(3)read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 forms part of this Annual Report. The requisite Certiicate from theStatutory Auditors of the Company conirming compliance with the conditions of CorporateGovernances annexed i to this Report and marked as Annexure - 8
Your Directors take this opportunity to thank the Financial Institutions BanksCentral and State Governments authorities Regulatory authorities Stock Exchanges and allthe various stakeholders for their continued co-operation and support to the Company. YourDirectors also wish to place on record their appreciation to all of the Companysemployees and workers at all level for their enormous personal efforts as well as theircollective contribution to the Companys performance.
| ||For and on behalf of the Board of Directors |
| ||Narrindra Suranna |
| ||(DIN: 00060127) |
| ||Chairman& Managing Director |
|Place: Kolkata || |
|Date: 30.05.2017 || |