Your Directors have pleasure in presenting the 11th (Eleventh) Annual Reporttogether with the Audited Financial Statements of your Company for the financial yearended March 31 2018.
1. FINANCIAL RESULTS:
The Company s financial performance for the year ended March 31 2018 is summarized asbelow:
| || ||(Amount in 000) |
| ||Current Year ||Previous Year |
|Particulars ||2017-18 ||2016-17 |
|Revenue from operations ||213335.11 ||193041.46 |
|Other income (net) ||2091.56 ||1798.35 |
|Total Income ||215426.67 ||194839.81 |
|Less: || || |
|Operating & Administrative expenses ||173012.01 ||149480.66 |
|Profit Before Depreciation Interest & Tax ||42414.66 ||45359.15 |
|Less: || || |
|Depreciation and amortization expense ||11234.26 ||9766.26 |
|Finance costs ||3441.11 ||3050.97 |
|Profit before exceptional item and tax ||27739.29 ||32541.92 |
|Exceptional item ||- ||- |
|Profit before tax (PBT) ||27739.29 ||32541.92 |
|Tax expense ||7830.29 ||10707.09 |
|Profit after tax for the year (PAT) ||19909.01 ||21834.83 |
|EPS (Rs.) ||2.34 ||3.21 |
2. OPERATION & REVIEW:
Revenue from the operations of your Company for the year 2017-18 was Rs.213335110/- 10.51% higher than Rs. 193041463/- in the previous year. Profit beforeDepreciation Interest & Tax for the current year was Rs. 42414660/- against Rs.45359150/- in the previous year. Profit after Tax for the current year at Rs.19909010 was decreased by 8.81% over Rs. 21834830/- in the previous year. Detailedreport on operations of and structure of Business of the Company has been included inManagement Discussion and Analysis Report which forms part of this Annual Report.
3. RISK MANAGEMENT AND INTERNAL CONTROL
Your Company recognizes that risk is an integral part of business and is committed tomanaging the risks in a proactive and efficient manner. The Company at regular intervalsmonitors the financial operational legal risk to the Company through procedures likeaudit inspections etc.
There is no risk which in the opinion of the Board may threaten the existence of theCompany. The internal financial controls are adequate and are monitored at regularintervals.
The Board thinks that the profits should be retained for the expansion of the Companywhich is in pipeline for more growth and value addition to the company and forming astrong business base so that revenue flows from many channels and hence the Directors ofyour Company do not recommend any dividend for FY 2017-18.
5. SHARE CAPITAL
As on March 31 2017 The Authorised share capital of the Company was Rs. 800 Lacsconsisting of 80 Lacs equity shares of Rs. 10 each and during the financial year 2017-18the Authorised Capital of the Company was increased from 800 Lacs to 1500 Lacs as approvedby the shareholders of the Company in its 10th Annual General Meeting held onAugust 29 2017
During the financial year 2017-18 the shareholders of the company in the 10thAGM also approved the proposal for issue of Bonus Shares in the ratio 1:2 (i.e. One newequity share of Rs. 10 each for every Two existing equity share of Rs. 10 each)Subsequently 3400000 bonus shares were issued & allotted on September 29 2017.Consequent to issue of Bonus shares the Issued and Paid up Share Capital of the Companywas increased from Rs. 680 Lacs consisting of 6800000 equity shares of Rs. 10/- each toRs. 1020.00 Lacs consisting of 10200000 equity shares of Rs. 10/- each.
6. TRANSFER TO RESERVES
The Company has not transferred any amount to the General Reserve account during thereporting period.
7. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
During the period under review there is no unpaid/unclaimed dividend which is requiredto transfer in IEPF (Investor Education and Protection Fund) as per the provisions of theCompanies Act 2013.
8. MANAGEMENT AND DISCUSSION ANALYSIS REPORT:
A Separate report on Management Discussion and Analysis Report as required under clause34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 hasbeen presented in a separate section forming part of this Annual Report.
9. CHANGE IN NATURE OF THE BUSINESS
There was no change in the nature of business of the Company during the year underreview.
10. HUMAN RESOURCE DEVELOPMENT
The Company sees its employees as critical to the future and believes that everyemployee needs to possess apart from competence capacity and capabilities sustainablevalues current and contemporary which would make them useful and relevant and competitivein managing the change constructively for overall growth of the organization. To this endthe company s approach and efforts are directed towards creating a congenial workatmosphere for individual growth creativity and greater dedicated participation inorganizational development. The Company believes that the success of an organizationlargely depends on the quality of its workforce. Employee relations remained cordial andpeaceful throughout the year.
11. QUALITY INITIATIVES:
The Company is committed to the highest level of quality and continuous improvementprogramme are organized at all the level. The manufacturing operation of the Company isISO 9001:2008 U-Stamp and U2- Stamp certified by the independent originations.
12. SUBSIDIARY COMPANIES:
The Company does not have any subsidiary companies hence Your Company is not requiredto present the consolidated financial statement as per the requirement of the provision ofSection 136 of the Companies Act 2013.
13. MATERIAL CHANGES AND COMMITMENTS
There is no material change and commitments affecting the Financial Position of theCompany which have occurred between the end of the financial year of the Company to whichthe financial statements relates and the date of the report.
14. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mr. Rameshchandra Nathalal Patel Chairman & Whole Time Director is liable toretire by rotation at the forthcoming Annual General Meeting and being eligible offerhimself for re- appointment.
A Statement on declaration given by Independent Directors under section 149 sub-section(6) is given by Independent Director of the Company
There was no change in any Key Managerial Personnel of the Company during the year.
15. NUMBER OF MEETINGS OF THE BOARD
Ten (10) meetings of the board were held during the year. For details of the meetingsof the board please refer to the Corporate Governance Report which forms part of thisreport.
16. BOARD EVALUATION
The Board evaluated the effectiveness of its functioning and that of the Committees andof individual directors by seeking their inputs on various aspects of Board/CommitteeGovernance. The evaluation covered functioning and composition of the Board and itscommittees understanding of the roles and responsibilities experience competenciesparticipation at the Board and Committee meetings corporate governance practices etc.
Evaluation of the Board and its compositions was carried out through a defined processcovering the areas of the Boards functioning viz. composition of the Board and Committeesunderstanding of roles and responsibilities experience and competencies contribution atthe meetings etc.
17. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS
Pursuant to the requirement of Section 134(3)(e) and Section 178(3) of the CompaniesAct 2013 the Board has on the recommendation of the Nomination and RemunerationCommittee framed a policy on appointment of Directors including criteria for determiningqualifications positive attributes independence of a Director and the policy onremuneration of Directors KMP and other senior management has been disclosed in thecorporate governance report which forms part of this report.
18. AUDIT COMMITTEE
During the year under review the Company constituted the Audit Committee and theprimary objective is to monitor and supervise the financial reporting to ensure accurateand timely disclosures transparency integrity and quality of financial reporting. As ofthe date of this report the audit committee is comprised of Mr. Babubhai Patel(Chairman) Mr. Rameshchandra Nathalal Patel (Member) and Mr. Kalpesh Lalitchandra Joshi(Member).
19. STATUTORY AUDITORS
J. M. Patel & Bros. Chartered Accountants who are the statutory auditors of theCompany hold office until the conclusion of the ensuing AGM and are eligible forre-appointment. Members of the Company at the AGM held on 30th September 2014had approved the appointment of J. M. Patel & Bros. as the Statutory Auditors for aperiod of five years from the conclusion of the Annual General Meeting held on 30thSeptember 2014 till the conclusion of Annual General Meeting of the Company to be held incalendar year 2019. As required by the provisions of the Companies Act 2013 theirappointment should be ratified by members each year at the AGM. Accordingly requisiteresolution forms part of the notice convening the AGM. The auditors report does notcontain any qualifications reservations or adverse remarks.
20. SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed Mr. VivekSharma Proprietor of M/s Sharma Vivek & Associates Company Secretary in practice toundertake the Secretarial Audit of the Company for the year under review. The Board hasduly reviewed the Secretarial Auditor s Report and the comments appearing in the reportare self-explanatory and do not call for any further explanation by the Board of Directorsas provided under section 134 of the Act. The Secretarial Audit Report is annexed herewithas Annexure IV .
21. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The particulars of loans guarantees and investments have been disclosed in thefinancial statements.
22. VIGIL MECHANISM /WHISTLE BLOWER POLICY
As per the provisions of Section 177 (9) & (10) of the Companies Act 2013 readwith Regulation 22 of Securities and Exchange Board Of India (Listing Obligations andDisclosure Requirements) Regulations 2015 your Company has a Whistle Blower Policy witha view to provide vigil mechanism to Directors employees and other stakeholders todisclose instances of wrong doing in the workplace and report instances of unethicalbehavior actual or suspected fraud or violation of the Company s code of conduct orethics policy. The Whistle Blower Policy also states that this mechanism should alsoprovide for adequate safeguards against victimization of Director(s)/ Employees who availof the mechanism and also provide for direct access to the Chairman of the Audit Committeein exceptional cases.
23. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has zero tolerance towards sexual harassment at the workplace and hasadopted a policy on prevention prohibition and redressal of sexual harassment atworkplace in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules thereunder.
During the Financial Year 2017-18 the Company has not received any complaints ofsexual harassment.
24. TRANSACTIONS WITH RELATED PARTIES
Pursuant to the provisions of Section 134 (3) read with Section 188 (2) of theCompanies Act 2013 details of transaction for the year under review are given in FormAOC-2 as Annexure III to this report and in the section on Related Party Transactions inCorporate Governance Report.
25. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT 9 as perprovisions of Companies Act 2013 and rules there to be annexed to this report as AnnexureII .
26. PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of the Companies(Appointment & Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company will be provide upon request. In terms of Section 136 of the Actthe reports and accounts are being sent to the members and others entitled theretoexcluding the information on employee s particulars which is available for inspection bymembers at the registered office of the Company during the business hours on all workingdays of the Company up to the date of ensuing Annual General Meeting of the Company. Ifany member is interested in inspection the same the member may write to the CompanySecretary in advance.
27. DEPOSITS FROM PUBLIC
Your Company has not accepted any Fixed Deposits as defined under Section 73 of theCompanies Act 2013 and rules framed thereunder.
28. DIRECTORS' RESPONSIBILITY STATEMENT
As required by Section 134 (5) of the Companies Act 2013 the Directors herebyconfirm:
(i) in the preparation of the annual financial statements applicable accountingstandards have been followed and there are no material departures from the said standards;
(ii) such accounting policies have been selected and applied consistently and judgmentsand estimates made that are reasonable and prudent so as to give a true and fair view ofthe state of affairs of the company as at March 31 2018 and of the profit of the companyfor the year ended on that date;
(iii) proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of thecompany and for prevention and detection of fraud and other irregularities;
(iv) the annual financial statements have been prepared on a going concern basis;
(v) proper internal financial controls are in place and are adequate and are operatingeffectively; and
(vi) the systems to ensure compliance with the provisions of all applicable laws are inplace and are adequate and operating effectively.
29. CORPORATE SOCIAL RESPONSIBILITY
The Company is not falling under the criteria as mentioned in the Section 135 of theCompanies Act 2013 and rules made thereof which specifies the requirement of forming theCorporate Social Responsibility Committee.
30. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGOCONSERVATION OF ENERGY:
Details of the energy conservation technology absorption and foreign exchange earningsand outgo are annexed to this report as Annexure I .
31. THINK GREEN GO GREEN' INITIATIVE
The Companies Act 2013 permits companies to send documents like Notice of AnnualGeneral Meeting Annual Report and other documents through electronic means to its membersat their registered email addresses besides sending the same in physical form.
As a responsible Corporate Citizen the Company has actively supported theimplementation of Green Initiative of Ministry of Corporate Affairs (MCA) and effectedelectronic delivery of Notices and Annual Reports to those shareholders whose email idswere already registered with the respective Depository Participants (DPs) and who have notopted for receiving such documents in physical form. The intimation of dividends(interim/final) is also being sent electronically to those shareholders whose email idsare registered.
Members who have not registered their e-mail addresses so far are requested toregister their e-mail address with the Registrar and Share Transfer agent (R&TA) ofthe Company/Depository participant (DP) of respective member and take part in the GreenInitiative of the Company for receiving electronic communications and support the"THINK GREEN GO GREEN" initiative.
Further pursuant to Section 108 of the Companies Act 2013 read with Rule 20 of theCompanies (Management and Administration) Rules 2014 the Company is providing e-votingfacility to all members to enable them to cast their votes electronically in respect ofresolutions set forth in the Notice of Annual General Meeting (AGM). The detailedinstructions for e-voting are provided in the Notice of AGM.
We thank our customers vendors dealers investors business associates and bankersfor their continued support during the year. We place on record our appreciation of thecontribution made by employees at all levels.
| ||For and on behalf of the Board |
| ||Loyal Equipments Limited |
|Date: June 27 2018 ||Sd/- |
|Place: Dahegam Gandhinagar. ||Alkesh Rameshchandra Patel |
| ||Managing Director |
| ||DIN 02672297 |