You are here » Home » Companies » Company Overview » Kovilpatti Lakshmi Roller Flour Mills Ltd

Kovilpatti Lakshmi Roller Flour Mills Ltd.

BSE: 507598 Sector: Agri and agri inputs
NSE: KLRF ISIN Code: INE014E01015
BSE 00:00 | 03 Jul 37.45 2.25
(6.39%)
OPEN

35.20

HIGH

37.60

LOW

35.00

NSE 05:30 | 01 Jan Kovilpatti Lakshmi Roller Flour Mills Ltd
OPEN 35.20
PREVIOUS CLOSE 35.20
VOLUME 2615
52-Week high 42.45
52-Week low 19.25
P/E 4.88
Mkt Cap.(Rs cr) 21
Buy Price 37.45
Buy Qty 26.00
Sell Price 37.45
Sell Qty 274.00
OPEN 35.20
CLOSE 35.20
VOLUME 2615
52-Week high 42.45
52-Week low 19.25
P/E 4.88
Mkt Cap.(Rs cr) 21
Buy Price 37.45
Buy Qty 26.00
Sell Price 37.45
Sell Qty 274.00

Kovilpatti Lakshmi Roller Flour Mills Ltd. (KLRF) - Director Report

Company director report

Dear Shareholders

The Directors present their Fifty Seventh Annual Report together with the auditedstatement of accounts for the year ended 31st March 2019.

(र in Lakhs)
FINANCIAL RESULTS 31.3.2019 31.3.2018
Total Income 23236.41 21998.18
Profit before finance cost and depreciation 807.78 1129.00
Less: Financial charges 624.20 718.00
Profit before depreciation 183.58 411.00
Less : Depreciation 378.96 307.62
Profit / (Loss) before tax (195.38) 103.38
Add/ Less Income tax expense-Current - 102.00
-Deferred tax charge/(credit) (50.21) (156.61)
Profit/ (loss) for the year from operations (145.17) 157.99
Other comprehensive income net of tax 1.25 (12.64)
Total comprehensive income for the year (143.92) 145.35

REVIEW OF BUSINESS OPERATIONS

During the year ended 31st March 2019 the Company has recorded a total turnover ofर 23157 lakhs as against र 21971 lakhs achieved during the previous year. Theloss after tax amounted to र 145 lakhs as against a profit of र 158 lakhs in theprevious year. The profit before Interest Depreciation Taxes and Amortization (EBIDTA)amounted to र 808 lakhs as against र 1129 lakhs in the previous year.

There was no change in the nature of business of the Company during the financial yearended 31st March 2019.

The performance of each business segment of the Company has been comprehensivelydiscussed in the Management Discussion and Analysis Report (forming part of thisDirectors' Report)

FINANCE

Your Company continued to avail need based working capital facilities from Canara Bankand HDFC Bank Limited.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Corporate governance and Management Discussion & Analysis Report which form anintegral part of this Report are annexed to this report. The Company has complied with theconditions relating to Corporate Governance as stipulated in terms of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The Certificate from thestatutory auditor relating to the above is annexed.

SHARE CAPITAL

The paid up Equity Share Capital as on 31st March 2019 was र 55414760/-.During the year under review the Company has not made any fresh issue of any shares.

TRANSFER TO RESERVES

The Company has not transferred any amount to its General Reserves. However the lossamount of र 145.17 lakhs is carried forward in the Profit & Loss Account.

DIVIDEND

In order to conserve reserves your Directors do not recommend any dividend on thepaid-up equity share capital of the company for the year ended 31st March 2019.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

There is no amount required to be transferred to the Investor Education and ProtectionFund in accordance with the provisions of the Companies Act 2013 and rules madethereunder.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 of the CompaniesAct 2013 read with Rule 12 of the Companies (Management and administration) Rules 2014is furnished in Annexure and is attached to this Report.

BOARD AND COMMITTEE MEETINGS

Details of the composition of the Board and its Committees namely Audit CommitteeNomination and Remuneration Committee Stakeholders Relationship Committee CSR Committeeand of the Meetings held and attendance of the Directors at such Meetings are provided inthe Corporate Governance Report which forms a part of this Report.

STATEMENT ON COMPLIANCE OF APPLICABLE SECRETARIAL STANDARDS

The Directors have devised proper systems to ensure compliance with the provisions ofall applicable Secretarial Standards and that such systems are adequate and operatingeffectively. The Company has duly complied with Secretarial Standards issued by theInstitute of Company Secretaries of India on the meeting of the Board of Directors (SS-1)and General Meetings (SS-2).

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that;

a) In the preparation of the annual accounts the applicable accounting standards havebeen followed.

b) The Directors have 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 at the end of the financial year and ofthe loss of the Company for the year under review.

c) The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.

d) The Directors have prepared the annual accounts for the financial year ended 31stMarch 2019 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.

f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

DECLARATION OF INDEPENDENT DIRECTORS

All the Independent directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 read withSchedules and Rules issued thereunder and Regulation 25 of SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015.

REMUNERATION POLICY

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirRemuneration. The Remuneration Policy is furnished in the Company's website at www.klrf.inand abstract of which is furnished as "Annexure - D" and forms part of thisreport.

AUDITORS

M/s.Arun & Co (Firm Registration Number 014464S) Chartered Accountant StatutoryAuditor of the Company were appointed for a period of five consecutive years from theconclusion of 55th Annual General Meeting till the conclusion of 60th Annual GeneralMeeting subject to ratification of the appointment by the Members at every AGM if sorequired under the Act. In accordance with the Companies Amendment Act 2017enforced on7th May 2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditorsis not required to be ratified at every Annual General Meeting.

M/s VKS Aiyer & Co Chartered Accountants was appointed by the Board as branchauditors for the engineering division of the Company.

COST AUDITOR

The Company has made and maintained cost records as prescribed by the CentralGovernment under Section 148 of the Companies Act 2013. The Board of Directors at itsmeeting held on 29th May 2019 based on the recommendation of the audit committeeappointed M/s P.Mohankumar & Co. Cost Accountants as Cost Auditor to audit the costaccounts of the Company for the financial year 2019-20.

As required under the provisions of Section 148 of the Companies Act 2013 necessaryresolutions seeking members ratification for the remuneration payable to M/s P.Mohankumar& Co. Cost Accountants is included in the Notice convening the Fifty Seventh AnnualGeneral Meeting. Cost audit report for the year ended 31st March 2019 will be filed on orbefore the due date.

SECRETARIAL AUDITOR

Pursuant to provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. M.D.Selvaraj FCS Proprietor of MDS & Associates Company SecretariesCoimbatore to conduct the Secretarial Audit of the Company. The Secretarial Audit Reportis annexed herewith as "Annexure-A"

COMMENTS ON AUDITORS REPORT

There are no qualifications reservations or adverse remarks or disclaimers made by theAuditors/ Secretarial Auditor in their report. There were no instances of fraudsidentified or reported by the Statutory auditors during the course of their audit pursuantto Section 143(12) of the Companies Act 2013.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS U/S 186

There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the period under review. Details of investments made in theprior years are given in the notes 5 of the financial statement.

RELATED PARTY TRANSACTIONS

All transactions entered into during the financial year 31st March 2019 with relatedparties as defined under the Companies Act 2013 and SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 were in the ordinary course of business and onan arm's length basis. During the year the Company had not entered into any transactionreferred to in Section 188 of the Companies Act with related parties which could beconsidered material under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Accordingly the disclosure of related party transactions as requiredunder Section 134(3) of the Companies Act in Form AOC-2 is not applicable. Attention ofmembers is drawn to the disclosures of transactions with related parties set out in OtherNotes on Accounts number 44 forming part of the financial statements.

The Company has developed a policy on related party transactions for identification andmonitoring of transactions. The policy on related party transactions as approved by theBoard is uploaded and can be accessed at company's website www.klrf.in

MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY

No material changes and commitments affecting the financial position of the Companyhave occurred between the end of the financial year to which the financial statementsrelate and the date of this Directors' Report.

RISK MANAGEMENT

The Company has a structured risk management policy. The risk management process isdesigned to safeguard the organisation from various risks through adequate and timelyactions. It is designed to anticipate evaluate and mitigate risks in order to minimizeits impact on the business. The potential risks are inventorised and integrated with themanagement process such that they receive the necessary consideration during decisionmaking.

CORPORATE SOCIAL RESPONSIBILITY

The Board had formed a Corporate Social Responsibility (CSR) Committee comprising ofMr.Suresh Jagannathan Mr.Sudarsan Varadaraj Mr.K.Gnanasekaran and Mr.R.Kannan.

The composition and terms of reference of the CSR Committee are provided in theCorporate Governance Report forming part of this Annual Report. The Company has alsoformulated a CSR Policy which is available on the website of the Company viz. www.klrf.in

The disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy)Rules 2014 is annexed as Annexure -E and forms an integral part of this Annual Report

BOARD EVALUATION

The Board has made a formal annual evaluation of its own performance Committees of theBoard Independent Directors and Individual Directors of the Company.

The Board's performance was evaluated based on criteria like structure governancedynamics and functioning and review of operations financials internal controls etc.

The performance of the Independent Directors as well as Individual Directors wereevaluated based on the evaluation criteria laid down under the Nomination and RemunerationPolicy and Code of Conduct as laid down by the Board.

The Committees of the Board were evaluated based on the terms of reference specified bythe Board to the said Committee effectiveness of Committee meetings quality ofrelationship of the Committee and the management etc. The Board of Directors weresatisfied with the evaluation process which ensured that the performance of the Board itsCommittees Independent Directors and Individual Directors adhered to their applicablecriteria.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Ashwin Chandran (DIN: 00001884) was appointed as an Additional Director by theBoard of Directors of the Company at their meeting held on 30th August 2018 andsubsequently his appointment as an Independent Director for a period of 5 consecutiveyears with effect from 1st September 2018 was approved by the members of the Companythrough postal ballot process.

Mr. R. Kannan (DIN: 00951451) Executive Director of the Company has resigned his wholetime directorship on 25th May 2018 and continues as a Non Executive Non IndependentDirector of the Company.

Mr. Rajagopal Gopinath (DIN: 00096122) Independent Director has resigned hisDirectorship in the Company with effect from 29th March 2019. Your Directors wish toplace on record their appreciation for the invaluable services rendered by Mr. RajagopalGopinath (DIN: 00096122) during his tenure of office as Independent Director of theCompany.

Mr. Sudarsan Varadaraj (DIN: 00133533) Independent Director has become as a NonExecutive Non Independent Director with effect from 1st October 2018 due to the amendmentmade in Regulation 16(1)(b)(viii) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. As per the provisions of Section 152 of the CompaniesAct 2013 Mr. Sudarsan Varadaraj (DIN: 00133533) is liable to retire by rotation at theensuing annual general meeting and being eligible offers himself for re-appointment. TheBoard recommends his re- appointment.

Further based on the recommendation of the Nomination and Remuneration Committee theBoard of Directors at their meeting held on 29th May 2019 has recommended there-appointment of Mr. K. Gnanasekaran (DIN: 00133645) as Independent Director of theCompany for a second term of 5 consecutive years with effect from 18th September 2019subject to the approval of the members by way of passing a special resolution at theensuing Annual General Meeting. The Board has also received declaration from the appointeeIndependent Director that he fulfill the criteria of independence as prescribed underSection 149(6) of the Companies Act 2013 read with Regulation 16(1)(b) of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. Accordingly theBoard recommends his re- appointment.

A brief resume details of expertise and other Directorships/ Committee membershipsheld by the above Director form part of the Notice convening the 57th AGM of the Company.

Key Managerial Personnel

Key Managerial Personnel of the Company as required pursuant to Section 203 of theCompanies Act 2013 are

Mr. Suresh Jagannathan - Managing Director
Mr. K.R.Badrinarayanan - Chief Financial Officer
Mr. R. Kannan - Executive Director (upto 25th May 2018)
Mr. S.Piramuthu - Company Secretary

AUDIT COMMITTEE

The Audit Committee of the Board of Directors of the Company comprises four membersnamely Mr. K.Gnanasekaran Mrs. Kalyani Jagannathan Mr. Ashwin Chandran and Mr. SudarsanVaradaraj. All the members are Independent Directors except Mr.Sudarsan Varadaraj.Mr.K.Gnanasekaran is the Chairman of the Audit Committee.

The Board accepted all the recommendations whenever made by the Audit Committee duringthe year.

The details of the number of meetings held and attendance of Directors at such meetingsare provided in the Corporate Governance Report which forms part of the Annual Report.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

A. CONSERVATION OF ENERGY

(i) The steps taken or impact on conservation of energy

Company ensures that the manufacturing operations are conducted in the manner wherebyoptimum utilization and maximum possible savings of energy is achieved

(ii) The steps taken by the Company for utilizing alternate source of energy

The Company has installed 7.00 M.W. wind energy for captive consumption.

(iii) The capital investment on energy conservation equipments

As the impact of measures taken for conservation and optimum utilization of energy arenot quantitative its impact on cost cannot be stated accurately.

B. TECHNOLOGY ABSORPTION

i) Company's products are manufactured by using in-house know how and no outsidetechnology is being used for manufacturing activities. Therefore no technology absorptionis required.

ii) EXPENDITURE INCURRED ON RESEARCH AND DEVELOPMENT

No specific expenditure of recurring or capital nature is involved in research anddevelopment directly.

C. FOREIGN EXCHANGE EARNINGS AND OUT GO

During the year under review your Company has earned foreign exchange of र 28.33lakhs and an outflow of र 0.72 lakhs

SUBSIDIARY COMPANIES

The company does not have any subsidiary associate company or joint venture.

FIXED DEPOSITS

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. Hence thereare no unclaimed or unpaid deposits as on 31st March 2019.

DISCLOSURE UNDER SECTION 197(12) AND RULE 5(1) OF THE COMPANIES (APPOINTMENT ANDREMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014

The requisite details relating to ratio of remuneration percentage increase inremuneration etc. as stipulated under section 197(12) and Rule 5(1)of the Companies(Appointment and Remuneration of Managerial Personnel) Rules2014 are annexed asAnnexure-C to this Report.

DISCLOSURE UNDER RULE 5(2) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014

The disclosure referred to the Rule 5(2) of Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 does not apply to the Company as there were no employeeswho are in receipt of remuneration in the aggregate at the rate of not less thanर10200000/- if employed throughout the year or र 850000/- per month ifemployed for part of the year.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

Your Company has established a vigil mechanism for directors and employees to reporttheir genuine concerns details of which have been given in the Corporate GovernanceReport forming part of this Annual Report.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has implemented and evaluated the Internal Financial Controls which providea reasonable assurance in respect of providing financial and operational informationcomplying with applicable statutes and policies safeguarding of assets prevention anddetection of frauds accuracy and completeness of accounting records. The Internal AuditReports were reviewed by the Audit Committee. Further the Audit Committee annuallyreviews the effectiveness of the Company's internal control system. The Directors andManagement confirm that the Internal Financial Controls (IFC) are adequate and effectivewith respect to the operations of the Company. A report of Auditor's pursuant to Section143(3)(i) of the Companies Act2013 certifying the adequacy of Internal Financial Controlsis annexed with the Auditor's report.

LISTING

Equity shares of the Company continued to be listed on BSE Limited.

ORDERS BY REGULATORS COURTS OR TRIBUNALS

No significant and/or material orders were passed by any regulator or court or tribunalimpacting the going concern status and the Company's operations in future.

DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been setup to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary and trainees) are covered under this policy. The Company has not received anysexual harassment complaint during the year 2018-19.

ACKNOWLEDGEMENTS

Your directors acknowledge with gratitude the co-operation and assistance from itsbankers. Your Directors would like to thank all Shareholders Customers and Employees inappreciation of their continued support.

May the Almighty Goddess Lakshmi continue to shower HER choicest blessings and Continueto grant us prosperity in the years to come.

By Order of the Board
K.Gnanasekaran Suresh Jagannathan
Place : Coimbatore Director Managing Director
Date : May 29 2019 DIN : 00133645 DIN : 00011326