To The Members
LINAKS MICROELECTRONICS LIMITED
Your Directors present the Thirty Fourth Boards' Report of the Company togetherwith Audited Financial Statements of your company for the financial year ended 31stMarch 2019.
|1. FINANCIAL RESULTS || || |
| || |
(Amount in Thousand Rs.)
|Financial Results ||Year ended 31.03.2019 ||Year ended 31.03.2018 |
|(a) Turnover (including Other Income) ||6922 ||16746 |
|(b) Net Profit/Loss (before depreciation and tax) ||-6419 ||-4339 |
|Depreciation ||1564 ||2186 |
|(c) Net Profit/(Loss) before extraordinary items ||-7983 ||-6525 |
|Extraordinary items ||- ||1303 |
|(d) Net Profit/(Loss) before tax ||-7983 ||-5222 |
|Provision for Tax (including for deferred tax) ||0 ||0 |
|(d) Net Profit/(Loss) after tax ||-7983 ||-5222 |
2. BRIEF DESCRIPTION OF THE COMPANY'S WORKING DURING THE YEAR
The year ending on March 31 2019 was Annus Horribilis.
We had laid the foundation of sustained growth in orders to cross the Break-Even levelthrough an exclusive selling arrangement with the Delhi based firm last year i.e.2017-18. Secondly the leave & licence real estate Developer's were expecting anuptick in the dormant real-estate market during 2018-19. They had held out hope toincrease the release of funds to the Company which in turn would have enhanced ourworking funds.
Alas none of the expectations was met and almost anything that could go wrong wentwrong. Early in the year our Delhi based sales arrangement got a rude shock when the CEOof the firm suffered a massive stroke and could not return to run the business heis still in rehabilitation.
His illness gave a massive setback to our sales which nose-dived and it took us almostthe rest of the year to fill the breach and we are still far from achieving it. So theyear under review the Company has operated at below cash break-even level and bled red onthe balance sheet. The silver lining is that a new team has taken over the running of ourDelhi based Sales associate and the order book once again has started looking up. Augurswell for the coming year.
On the second issue of the funds infusion from the developer's of our old site thingshave gone from bad to worse. M/s Clarion Townships Pvt. Ltd. the company that was giventhe leave and license permission to develop the site could not progress beyond 10-15%completion stage. They have run afoul with their lending Bank who have invoked SARFAESIagainst them and possessed the site. Since the arrangement of their financing was sostructured that they had not only mortgaged their share of the built-up project area buthad also been extended a Corporate Guarantee by us to the lending Bank to facilitate &speed-up the arrangement in the interest of expeditious execution. Your Company had takencare to obtain a counter Corporate Guarantee from the parent company of Clarion namelyRohtas Projects Ltd. for the same amount to cover the overhang. We have since invoked ourCorporate Guarantee of Rohtas and have also taken due legal steps under the able advice ofour advocates to shield the Company from any negative fall-out. Simultaneously we arealso in discussions with other construction companies to step into the shoes of Clarionand complete the project. To accomplish this we have initiated dialogues with all thestake-holders.
In the coming year we do not foresee any significant impediment in ramping up oursales to the break even level and beyond. The challenge on hand would be to address theworking capital needs which would grow with the increase in sales. Our source of infusionfrom the site development project would not be immediately available; hence alternateavenues are being explored.
3. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary Joint venture or Associate Company.
4. DIVIDEND & RESERVES
In view of losses during the year under review no dividend pay-out is beingrecommended and accordingly no question of appropriation of reserves arise.
5. SHARE CAPITAL
The paid up share capital of the company as at 31st March 2019 remained atRs. 49535300. During the period under report your company has not issued any sharesincluding Sweat Equity ESOP Bonus and/or Convertible Debentures.
The Company has neither accepted nor renewed any deposits during the year under review.
7. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013
There was no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the year under review and hence the said provision is notapplicable.
8. MATERIAL CHANGES & COMMITMENTS
There has been no material changes and Commitment affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and date of the Report.
9. RISK MANAGEMENT POLICY OF THE COMPANY
The Company does not have any Risk Management Policy as the Company is still in theinitial phases of its rehabilitation. However the Company has introduced severalimprovements to Integrated Enterprise Risk Management Internal Controls Management andAssurance Frameworks and processes to drive a common integrated view of risks optimalrisk mitigation responses and efficient management of internal control and assuranceactivities.
10. HUMAN RESOURCE DEVELOPMENT
At LINAKS human resource development is considered vital for effective implementationof business plans. Constant endeavours are being made to offer professional growthopportunities and recognition. Your Company treats its "human resources" as oneof its most important assets. Your Company continuously invests in attraction retentionand development of talent on an ongoing basis. A number of programs that provide focusedpeople attention are currently underway. Your Company thrust is on the promotion of talentinternally through job rotation and job enlargement.
11. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company is an equal opportunity employer and consciously strives to build a workculture that promotes dignity of all employees. As required under the provisions of theSexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal) Act2013 and Rules framed thereunder the Company has implemented a policy on Prevention ofSexual Harassment of Women at Workplace. An Internal Committee has been set up to receivecomplaints investigate the matter and report to the management.
At the beginning of the year there was no complaint pending. During the year nocomplaint was received by the Committee and hence no complaint was pending at year end.
At the 32nd Annual General Meeting held on September 28 2017 the membershad appointed M/s Jaiswal Singh & Co. (Firm Registration No. 011049C) CharteredAccountants Kanpur as Statutory Auditors for a block period of 05 years beginning fromthe conclusion of the 32nd AGM till the conclusion of the 37th AGMsubject to them ratifying the said appointment at every AGM. The Company had receivedconfirmation from M/s Jaiswal Singh & Co. to the effect that their appointment wouldbe in terms of Section 139 and 141 of the Companies Act 2013 and rules made thereunder.
The Statutory Auditors have audited the books of accounts of the Company for theFinancial Year ended on March 31 2019 and have issued the Auditors' Report thereon. TheStatutory Auditors have not made any adverse comments or given any qualificationreservation or adverse remarks or disclaimer in their Audit Report.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Ms. Divya Matah of M/S Divya Matah and Associates a firm of Company Secretaryin Practice to undertake the Secretarial Audit of the Company. The Report of theSecretarial Audit is annexed herewith as Annexure A to this report.
As required under Regulation 24A of SEBI (LODR) Regulations 2015 M/s. Divya Matah& Associates Practicing Company Secretaries Lucknow has reported on the AnnualSecretarial Compliances of the Company for the year ended on 31st March 2019.The report is uploaded to the Stock Exchange. The said report has been provided underAnnexure-B' of the Directors' Report.
The Secretarial Auditor has not made any adverse comments or given any qualificationreservation or adverse remarks or disclaimer in their Audit Report and Compliance Report.
13. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with provision of the Companies Act 2013 Mrs. Meena Singh director ofthe Company is liable to retire by rotation at the ensuing AGM and is eligible for herreappointment.
Necessary resolutions for the reappointment of the aforesaid director and the detailedprofile has been included in the notice convening the annual general meeting.
There is change in the Board of Directors of the Company during the Financial Year2018-19. During the period since last report Dr. Gautam Singh and Mr. Udayan Singhresigned from the Board w.e.f. August 10 2018 due to personal reasons and othercommitments.
Your Directors take this opportunity to place on record their deep appreciation for thevaluable services and guidance rendered by Dr. Gautam Singh and Mr. Udayan Singh.
The Board at its meeting held on February 12 2019 appointed Mr. Jai Ram Singh as anAdditional and Non- Executive Independent Director of the Company based on recommendationof NRC effective from February 12 2019.
The Company is seeking approval of the Members for the appointment of Mr. Jai Ram Singhas Independent Director at the ensuing AGM.
All the directors of the company have confirmed that they are not disqualified frombeing appointed as directors in terms of Section 164 of the Companies Act 2013.
Furthermore Ms. Shivani Singh Yadav (ACS No. A41654) was appointed as the CompanySecretary of the Company w.e.f December 20 2018 but she had to resign from the job as onJanuary 31 2019 due to some of her personal reasons.
In order to comply with the mandatory requirement of recruiting a Company Secretary andCompliance Officer in a Listed company the company appointed Ms. Deepti Bammi anAssociate Member of The Institute of Company Secretaries of India (ACS No. A57019) as theCompany Secretary and Compliance Officer of the Company pursuant to Section 203 of theCompanies Act 2013 and Rule 8 of Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 w.e.f February 4 2019.
With respect to mandatory requirement for appointment of Chief Financial Officer in aListed Company Mr. Girish Chandra Jha being a commerce graduate and holding around 30years of working experience has been appointed as the CFO of the Company w.e.f. April 22019.
14. MANAGERIAL/EMPLOYEES REMUNERATION
A) Details of the ratio of the remuneration of each director to the median employee'sremuneration and other details as required pursuant to Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 cannot be worked out asthe Company is still in the process of recruitment of staff has not yet completed. Theskeletal staff with which the Company is presently working are mainly on part time basis.
B) As required pursuant to Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 the Company did not have any employee drawing aremuneration of Rs. 60.00 lacs p.a. if employed throughout the year or Rs.5.00 lacs p.m.if employed for a part of the said year under review. Moreover there was no employeeemployed throughout the financial year or part thereof was in receipt of remuneration inthat year which in the aggregate or as the case may be at a rate which in theaggregate is in excess of that drawn by the managing director or whole-time director ormanager and holds by himself or along with his spouse and dependent children not lessthan two percent of the equity shares of the company.
C) None of the Managing Director or Whole-time Director of the Company was in receiptof any commission from the Company. Moreover as the Company did not have any holding orsubsidiary Company the question of receiving commission by them from such Company alsodoes not arise.
15. DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Companies Act 2013 theBoard hereby submit its responsibility Statement:
(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 financial year and ofthe profit and loss of the company for that period;
(c) The directors had 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 had prepared the annual accounts on a going concern basis; and
(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) Tthe directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
16. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
In view of losses the Company has not developed and implemented any Corporate SocialResponsibility initiatives as the said provisions are not applicable.
17. EXTRACT OF ANNUAL RETURN (FORM MGT-9)
As per the requirements of Section 92(3) and 134(3)(a) of the Act and Rules madethereunder the extract of the Annual Return for the F.Y. 2018-19 is given inAnnexure C in the prescribed Form MGT-9 which is a part of this report.
18. MANAGEMENT DISCUSSION AND ANALYSIS REPORT AND REPORT
OF DIRECTORS ON CORPORATE GOVERNANCE
Your Company has already implemented the requirement of Regulation 27 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 i.e. Corporate Governance. Asrequired a Management Discussion and Analysis Report and Directors' Report as well asAuditors' Certificate on Corporate Governance are given alongwith this report.
Your Directors wish to place on record their appreciation for the cooperation andsupport extended by the Shareholders various authorities banks dealers and vendors.
The Directors also acknowledge with gratitude the dedicated efforts and valuablecontribution made by all the employees of the Company.
By order of the Board
For Linaks Microelectronics Limited
|Date: 07.08.2019 || |
|PLACE: LUCKNOW || |
|(ANIL KUMAR SINGH) ||(U.B. SINGH) |
|MANAGING DIRECTOR ||DIRECTOR |
|DIN: 00225518 ||DIN: 06650869 |