Your Directors have pleasure in presenting their 25th Annual Report together with theaudited accounts of the Company for the year ended 31st March 2019.
| || ||(र in Lakhs) |
| ||2018 19 ||2017 18 |
|Revenue from Operations ||36693.64 ||33189.15 |
|Other Income ||222.66 ||116.28 |
|Profit before depreciation interest and taxation ||2792.53 ||2693.32 |
|Finance Cost ||610.71 ||485.24 |
|Depreciation ||1044.38 ||960.29 |
|Profit before Tax ||1137.44 ||1247.79 |
|Provision for Taxation - Current ||246.00 ||267.00 |
|- Income Tax for earlier years ||206.24 ||- |
|- Deferred ||140.19 ||196.68 |
|Profit after Tax ||545.01 ||784.11 |
|Total Other Comprehensive Income ||(17.41) ||(2.11) |
|Total Comprehensive Income of the Year ||527.60 ||782.00 |
|Add: Credit Balance of the previous year ||744.51 ||996.39 |
|Amount available for Appropriation ||1272.11 ||1778.39 |
|Transfer to General Reserve ||500.00 ||500.00 |
|Dividend ||221.79 ||443.58 |
|Corporate Tax on Dividend ||45.59 ||90.30 |
|Balance carried to Balance Sheet ||504.73 ||744.51 |
An amount र 500 Lakhs is being transferred to the General Reserves of the Company as at31st March 2019.
Your Directors recommend a Dividend of र 1.50 per equity share (previous year र 1.50 perequity share) for the year ended 31st March 2019.
During the year under review the Company's Revenue from Operations increased by 10.6%to र 36694 Lakhs as compared to र 33189 during the preceding year. The Profit after taxduring the year was र 545 Lakhs as compared to र 784 Lakhs in the previous year a drop ofabout 30.5%. This was mainly due to Income Tax Liability of earlier years and significantinventory correction. This lead to a drop in Interest Coverage to 2.9 from 3.6 in theprevious year.
The year-end debtors were 43 days of sales for the year as compared to 50 days in theprevious year. The inventory holding as at year end was for 70 days of sales as comparedto 86 days as at the end of previous year.
A full analysis and discussion on the performance of the Company as well businessoutlook is included in this Annual Report under the heading Management Discussionand Analysis' as Annexure to this Report.
Directors' Responsibility Statement
Pursuant to Section 134(5) of the Companies Act 2013 the Directors hereby confirmthat:-
(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;
(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; 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.
The Company had complied with the requirements of Corporate Governance in terms of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. A separate reporteach on Corporate Governance (Annexure-B along with Auditors' Certificate on its duecompliance) and Management Discussion and Analysis is attached to this report.
The Directors state that applicable Secretarial Standards i.e. SS-1 SS-2 and SS-3relating to Meetings of the Board of Directors' General Meetings' andDividend' respectively have been duly followed by the Company.
The equity shares of the Company are listed on National Stock Exchange of India Limited(NSE) BSE Limited (BSE) and The Calcutta Stock Exchange Limited (CSE).
Directors and Key Managerial Personnel
In accordance with the Articles of Association of the Company Shri Deepak JalanManaging Director of the Company retire by rotation at the ensuing Annual General Meetingand being eligible offer himself for re-appointment.
Shri Sanjay Agarwal was appointed as an Additional Director of the Company by the Boardof Directors on 12th February 2019 on recommendation of Nomination and RemunerationCommittee. Shri Agarwal is recommended for appointment as Independent Director in terms ofSection 149 of the Companies Act 2013 for five consecutive years.
Shri Rohit Deepak Jalan was appointed as an Additional Director of the Company by theBoard of Directors on 28th May 2019 on recommendation of Nomination and RemunerationCommittee. Shri Rohit Deepak Jalan is recommended for appointment as Director- Sales &Marketing w.e.f. 1st October 2019 Shri Naresh Pachisia and Shri Anil Kochar have beenappointed Independent Director of the Company for a period of five consecutive years from29th August 2014 and their terms of office as Independent Directors will cease on 28thAugust 2019. The Board of Directors on the recommendation of the Nomination andRemuneration Committee have recommended the re-appointment of Shri Pachisia and ShriKochar as Independent Director for a further period of five consecutive years from 29thAugust 2019. The Board of Directors are also of the opinion that Shri Pachisia and ShriKochar fulfill all the criteria specified in the Companies Act 2013 and rules thereon andall the requirements of Listing Regulations 2015 making them eligible to be appointed asIndependent Director of the Company for a further term. Shri Pachisia and Shri Kochar donot hold any shares in the Company. Additional information is mentioned in the Noticeconvening the ensuing Annual General Meeting of the Company.
Shri K. N. Ranasaria Independent Non- Executive Director has resigned from the Boardw.e.f. 25th March 2019 as his age being more than prescribed in the Listing Regulations2015. The Directors have placed on record their sincere appreciation for the valuablecontribution and guidance provided by Shri K. N. Ranasaria during his tenure as Director.
The following persons continued as Key Managerial Personnel of the Company incompliance with the provisions of section 203 of the Companies Act 2013:
Shri Deepak Jalan - Managing Director
Shri Aloke Jalan - Whole Time Director
Shri N. K. Dujari - Chief Financial Officer & Company Secretary
Conservation of Energy Technology Absorption and Foreign Exchange Earnings & Outgo
A statement pursuant to section 134 of the Companies Act 2013 giving details ofmeasures taken towards conservation of energy technology absorption foreign exchangeearnings and outgo in accordance with the Companies (Accounts) Rules 2014 is annexed asAnnexure - C.
Particulars of Employees and related disclosures
Disclosure as required Section 197(12) of the Companies Act 2013 read with Rule 5(1)5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is annexed as Annexure D.
Policy on Directors' Appointment and Remuneration
Policy on Directors' Appointment is to follow the criteria as laid down under theCompanies Act 2013 and the Listing Regulations 2015 and good corporate practices.Emphasis is given to persons from diverse fields or professions.
Policy on Remuneration - Guiding Policy on remuneration of Directors Key ManagerialPersonnel and employees of the Company is
Remuneration to unionised workmen is based on the periodical settlement with theworkmen union.
Remuneration to Key Managerial Personnel Senior Executives Managers Staff andWorkmen (non Unionised) is industry driven in which it is operating taking into accountthe performance leverage and factors such as to attract and retain quality talent.
For Directors it is based on the shareholders resolutions provisions of the CompaniesAct 2013 and Rules framed therein circulars and guidelines issued by Central Governmentand other authorities from time to time.
Declaration by Independent Directors
Pursuant to Section 149(6) of the Companies Act 2013 and Listing Regulations 2015Independent Directors of the Company have made a declaration confirming the compliance ofthe conditions of the independence stipulated in the aforesaid section.
Related Party Transactions
All related party transactions that were entered into during the year under report wereon an arm's length basis and in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company during the year. Thusprovisions of section 134(3) (र) and 188(1) of the Companies Act 2013 are not applicableand therefore Form No. AOC-2 has not been attached. Related Party Transactions Policy isavailable on weblink http://www.lincpen.com
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. It is dealt with in greater details in the management discussion and analysissection.
The Company's credit ratings ascribed by CRISIL are - Long Term CRISIL A/Stable;and Short Term CRISIL A1.
Annual Evaluation by Board
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and adequate and meets the requirement of the Company.
Whistle Blower Mechanism
Your Company has put in place Whistle Blower Mechanism. The detailed mechanism is givenin Corporate Governance Report forming part of this report.
Extract of Annual Return
Extract of Annual Return is annexed as Annexure E.
Meeting of the Board of Directors
Five (5) meeting of the Board of Directors including a meeting of independentDirectors without the attendance of the Non-Independent Directors and members ofmanagement were held during the year. The details of the same are provided in theCorporate Governance Report.
M/s Singhi & Co. (FRN: 302049E) Chartered Accountants were appointed as theStatutory Auditor of the Company in 23rd Annual General Meeting held on 1st September2017 for a period of 5 consecutive years commencing from the conclusion of the 23rd AnnualGeneral Meeting till the conclusion of the 28th Annual General Meeting of the Company.
In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by theMinistry of Corporate Affairs the appointment of Statutory Auditors is not required to beratified at every Annual General Meeting.
The Report given by the Auditors on the financial statement of the Company is part ofthis Report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report.
The Company had appointed M/s D. C. Sahoo & Co. Practising Company Secretaries asthe Secretarial Auditor of the Company for the financial year 2018-19. The report of theSecretarial Auditor is annexed as Annexure F. The Secretarial Auditor has madeobservation in the report.
Internal Finance Control
The Company has put in place adequate system of internal finance controls commensuratewith its size and nature of its operations. During the year no material weakness in itsoperating effectiveness was observed.
Corporate Social Responsibility
With the enactment of the Companies Act 2013 and the Companies (Corporate SocialResponsibility) Rules 2014 read with various clarifications issued by Ministry ofCorporate Affairs the Company has undertaken activities as per the CSR Policy and thedetails are contained in the Annual Report on CSR activities given in Annexure - G formingpart of this report.
The amount required to be spent on CSR activities during the year under review inaccordance with the provisions of Section 135 of the Companies Act 2013 is र 40.71 Lakhsand the company has spent र 15.76 Lakhs during the current financial year. The spending wasless as the Company wanted to utilize the funds in justifiable sustainable and measurableactivities. The shortfall in the spend during the year under review is intended to beutilized in future on projects within the Company's CSR Policy.
Further as a responsible corporate citizen the Company had been involved in CSRactivities since its inception. Some of these activities will not fall under 2% CSR spendas per Schedule VII read with Section 135 of the Companies Act 2013. But the Companydecided to continue with them since those activities are integral to the business of theCompany.
Prevention of Sexual Harassment at workplace
The Company has in place a Policy against Sexual Harassment of Women at Workplace inline with the requirement of Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. Internal Complain Committee (ICC) has been setup toredress complaints received regarding sexual harassment. All employees (permanentcontractual temporary and trainees) are covered under this policy.
Number of complaints received by the Committee during the financial year : N I L
Your Directors state that no disclosure or reporting is required in respect of thefollowing matters as there were no transactions on these items during the year underreview:
There have been no material changes and commitments affecting the financialposition of the Company between the end of the financial year and date of this report.There has been no change in the nature of business of the Company.
Details relating to deposits covered under Chapter V of the Act.
The Company does not have any scheme of provision of money for the purchase ofits own shares by employees or by trustees for the benefit of employees.
No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
No fraud has been reported by the Auditors to the Audit Committee or the Board.
Your Directors express their appreciation to all the employees for their valuablecontribution. Your directors also wish to express their gratitude for the continuedco-operation support and assistance provided by all the valued Channel PartnersDistributors Suppliers Bankers Shareholders the Central and State Governments.
| ||For and on behalf of the Board |
| ||Deepak Jalan ||Aloke Jalan |
|Date: Kolkata ||Managing Director ||Whole Time Director |
|Place: 28th May 2019 ||DIN: 00758600 ||DIN: 00758762 |