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Lykis Ltd.

BSE: 530689 Sector: Consumer
NSE: N.A. ISIN Code: INE624M01014
BSE 00:00 | 18 Jul 27.65 -1.45
(-4.98%)
OPEN

29.90

HIGH

30.45

LOW

27.65

NSE 05:30 | 01 Jan Lykis Ltd
OPEN 29.90
PREVIOUS CLOSE 29.10
VOLUME 4929
52-Week high 62.55
52-Week low 26.40
P/E
Mkt Cap.(Rs cr) 54
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 29.90
CLOSE 29.10
VOLUME 4929
52-Week high 62.55
52-Week low 26.40
P/E
Mkt Cap.(Rs cr) 54
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Lykis Ltd. (LYKIS) - Director Report

Company director report

To

The Members

Your directors have pleasure in presenting the 33rd Annual Report together with theAudited Statement of Accounts for the financial year ended on 31st March 2017.

1. FINANCIAL PERFORMANCE SUMMARY :

(Rs. in Lakhs)

Particulars For the year ended on 31.03.2017 For the year ended on 31.03.2016 For the year ended on 31.03.2017 For the year ended on 31.03.2016
(Standalone) (Standalone) (Consolidated) (Consolidated)
Income
Revenue from operation 10608.22 10466.76 10723.88 10693.70
Capital Expenditure on tangible assets during the year 45.62 219.21 45.70 233.24
Amount transferred to Reserve - - - -
Profit / (Loss) before Depreciation Interest and Tax 397.46 476.09 24.94 335.82
Less : Depreciation 41.73 34.27 42.00 40.63
Profit / (Loss) after Depreciation but before Interest &Tax 355.73 441.82 (17.04) 295.19
Less : Interest 282.84 206.68 284.30 208.02
Profit / (Loss)after Depreciation and Interest but before Tax 72.89 235.14 (301.34) 87.17
Less : Provision For Taxation - - - -
Current Tax 20.62 51.20 20.62 51.20
Deferred Tax (7.98) 4.69 (7.98) 4.69
Profit / (Loss) after Tax for the period 60.25 179.25 (313.98) 31.28
Add/(Less): Share of Loss transferred to Minority Interest - - 0.19 2.64
Profit / (Loss) for the period after adjustment 60.25 179.25 (313.79) 33.92

2. PERFORMANCE REVIEW

The turnover including other income of the Company for the financial year 2016-17 stoodat Rs. 10723.88 Lakhs as against last year's Rs. 10693.70 Lakhs. The Profit/(Loss) beforetax is Rs. 24.96 Lakhs as against Rs. 335.82 Lakhs of last year. Profit/(Loss) for theyear stood Rs. (313.79)Lakhs as against Rs. 33.92 Lakhs of last year. Your Company hastaken several remedial steps to meet the challenges viz. measures in saving cost at allfront of operations optimize use of available resources etc.

3. BOARD OF DIRECTORS

In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. Vijay Kedia (DIN 00230480) retires by rotation at theensuing Annual General Meeting and being eligible offers himself for reappointment.Accordingly his re-appointment forms part of the notice of the ensuing Annual GeneralMeeting.

All Independent Directors of the Company have given declarations that they meet thecriteria of independence as laid down under Section 149(6) of the Act and Regulation16(1)(b) of the Listing Regulations. In the opinion of the Board they fulfill theconditions of independence as specified in the Act and the Rules made there under and haveno pecuniary relationship or transactions with the Company.

4. KEY MANAGERIAL PERSONNEL (APPOINTMENT & RESIGNATION)

In accordance with provisions of section 203 of the Companies Act 2013 and the rulesmade there under the Key managerial Person are Mr. Pawan Kumar Gupta Chief ExecutiveOfficer; Mr. Ankit Maheshwari Chief Financial Officer. Mr. Shailesh Bhaskar CompanySecretary resigned w.e.f 21 April 2017 and Ms. Rupa Khanna was appointed as CompanySecretary w.e.f 30 May 2017.

5. DIVIDEND

Your Directors have not recommended dividend for the financial year ended 31st March2017.

6. SHARE CAPITAL

The paid up Equity Share Capital as on 31st March 2017 stood at 19375155 no. ofshares. During the year under review the Company has not issued any shares or convertibleinstruments.

7. TRANSFER TO RESERVES

During the period under review the Company has not transferred any amount to reserves.

8. MATERIAL CHANGE IN NATURE OF BUSINESS

No material changes and commitments have occurred from the date of close of thefinancial year till the date of this report which affect the financial position of theCompany.

9. RISK MANAGEMENT

Business risks exist for any enterprise having national and international exposure. TheCompany is well aware of these risks and challenges and has put in place mechanisms toensure that they are managed and mitigated with adequate timely actions. The AuditCommittee reviews business risk areas covering operational financial strategic andregulatory risks.

10. ADEQUACY OF INTERNAL FINANCIAL CONTROLS

The Company has adequate Internal Control System commensurate with its size and natureof business. Internal Audit is periodically conducted by an external firm of CharteredAccountants who monitors and evaluates the efficiency and adequacy of internal controlsystem in the Company. Based on the report of internal audit function concernperson/department undertakes corrective actions and thereby strengthens the controls.

11. SUBSIDIARY COMPANIES JOINT VENTURE AND ASSOCIATE COMPANIES

Lykis Marketing Pvt. Ltd. It is a wholly owned subsidiary of Lykis Limited. In a veryshort period the Company has set up a marketing network in 10 States. The Company isfocused on domestic marketing of Tea and FMCG products.

Lykis Packaging Pvt. Ltd. Lykis Confectioners Pvt. Ltd. Lykis Soaps Pvt. Ltd. LykonFoods. Pvt. Ltd. Bion Aerosols Pvt. Ltd. and Lykis Homecare Pvt Ltd are the associatesCompanies.

12. DEPOSITS

The Company has not accepted or renewed any amount falling within the purview ofprovisions of Section 73 of the Companies Act 2013 ("the Act") read with theCompanies (Acceptance of Deposit) Rules 2014 during the year under review. Hence therequirement for furnishing of details of deposits which are not in compliance with theChapter V of the Act is not applicable.

13. CORPORATE SOCIAL RESPONSIBILITY

Lykis Limited is committed to empower the local communities in its area of operationand support them in their path to sustainable and inclusive growth. This commitment isfundamental to the Company's long term success. Lykis Limited is focused on creatingshared value and making a difference through our Corporate Social Responsibilityinitiatives. i. Being in the FMCG Sector the company is extremely environmental friendlyand strives to contribute towards preserving nature and our environment. ii. The Companyprovides several local employment opportunities and contributes towards improvement instandard of living. iii. Immense care is taken to ensure that the necessities of all ourstakeholders are met. We treasure our employees and ensure their happiness in severalways. iv. The employees are provided with a healthy working environment free lunch andproper sanitation and water supply. Considerable amount has been invested intoinfrastructure to ensure health and safety of our employees.

14. CORPORATE GOVERNANCE

The disclosures as required under Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are annexed with and forms part of this annualreport.

15. HUMAN RESOURCES

Your Company considers its Human Resources as the key to achieve its objectives.Keeping this in view your Company takes utmost care to attract and retain qualityemployees. The employees are sufficiently empowered and an enthusiastic and healthy workenvironment propels them to achieve higher levels of performance. The unflinchingcommitment of the employees is the driving force behind the Company's vision. Your Companyappreciates the spirit of its dedicated employees.

16. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of our knowledge and belief and according to the information andexplanations obtained by us your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:

a) In the preparation of the annual financial statements for the year ended 31st March2017 the applicable Accounting Standards had been followed along with proper explanationrelating to material departures if any ;

b) For the financial year ended 31st March 2017 such accounting policies as mentionedin the Notes to the financial statements have been applied consistently and judgements andestimates that are reasonable and prudent have been made so as to give a true and fairview of the state of affairs of the Company and of the Profit and Loss of the Company forthe year ended 31st March 2017.

c) That proper and sufficient care has been taken 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 annual financial statements have been prepared on a going concern basis.

e) That director has laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and operating effectively.

f) That proper systems to ensure compliance with the provisions of all applicable lawswere in place and that such systems were adequate and operating effectively.

17. MANAGEMENT DISCUSSION & ANALYSIS

Pursuant to Regulation 34(2)(e) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Management Discussion & Analysis forms part ofthe Annual Report.

18. PARTICULARS OF EMPLOYEES

As required under the provisions of the Companies Act 2013 and Rule 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 thestatement of particulars of the employees concerned forms part of the Board's Report.Since the company does not fall under the prescribed limit of the aforesaid provisions.Therefore this requirement is not applicable to the Company.

19. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

In accordance with the provisions of Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 required information relating to the conservation ofenergy technology absorption and foreign exchange earnings and outgo is given in the "AnnexureI" to the Directors' Report.

20. AUDITORS AND AUDITORS' REPORTS

a) Statutory Audit

Your Company's Auditors M/s. Sanjay P. Agarwal & Associates Chartered Accountantswere appointed as the Statutory Auditors at the 30th Annual General Meeting for a term of5 years. Their appointment is to be ratified by the Shareholders under Section 139 of theCompanies Act 2013 at the ensuing Annual General Meeting.

The Statutory Auditor's Report does not contain any qualification reservation oradverse remark. A Resolution seeking member's approval for ratification of appointment ofStatutory Auditor forms part of the Notice convening the Annual General Meeting.

b) Secretarial Audit

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 Mr. Bijay Agarwal Practicing Company Secretary as its Secretarial Auditor toundertake the Secretarial Audit for the financial year 2016-17. The Secretarial AuditReport certified by our Secretarial Auditors in the specified form MR-3 is annexedherewith and forms part of this report. (Annexure-II)

It does not contain any qualification reservation or adverse remark

21. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIESACT 2013

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

22. EXTRACT OF ANNUAL RETURN

The details of the extract of the Annual Return in form MGT9 is annexed herewith andforms part of this report. (Annexure III)

23. BOARD EVALUATION

Pursuant to the provisions of Section 178 of the Companies Act 2013 read with Rulesframed thereunder and provisions of Schedule IV to the Act as well as the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board has carried out anannual performance evaluation programme for the Board of Director Committees of the Boardand Individual Directors for the financial year 2016-17.

24. RELATED PARTY TRANSACTION POLICY

All transactions entered into with related parties as defined under the Companies Act2013 and Regulation 23 of SEBI (LODR) Regulation 2015 during the year under review were inthe ordinary course of business and on an arms' length basis and did not attract theprovisions of Section 188 of the Companies Act 2013. With regard to transactions withrelated parties prior approval of the Audit Committee was obtained wherever required.

During the year under review the Company had not entered into any contract/arrangement / transactions with related parties which could be considered as material. Theparticulars of contracts or arrangements referred to in section 188(1) of the CompaniesAct 2013 with related parties and as mentioned in form AOC-2 of the Rules prescribedunder Chapter IX under the Companies Act 2013 is annexed herewith and forms part of thisreport. (Annexure IV)

25. VIGIL MECHANISM / WHISTLE BLOWER POLICY

Pursuant to provision of Section 177 of the Companies Act 2013 rules framed thereunderand Regulation 22 of the SEBI (LODR) Regulation 2015 your Company has established a VigilMechanism/ Whistle Blower Policy to enable stakeholders including Directors and employeesto report unethical behavior actual or suspected fraud or violation of the Company's Codeof Conduct. The Policy provides adequate safeguards against victimization of Director(s)/employee(s) and direct access to the Chairman of the Audit Committee in exceptional cases.

The Protected Disclosures if any reported under this Policy will be appropriately andexpeditiously investigated by the Chairman. Your Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee and that nocomplaints were received during the year. The Whistle Blower Policy has been disclosed onthe Company's website www.lykisgroup.com and circulated to all the Directors / employees.

26. BOARD MEETINGS

During the financial year Five (5) Meeting of Board Director were held on 27 May2016 02 August 2016 12 August 2016 14 November 2016 and 14 February 2017respectively.

27. AUDIT COMMITTEE

The Board has well-qualified Audit Committee with majority of Independent Directorsincluding Chairman. They possess sound knowledge on accounts audit finance taxationinternal controls etc. As on 31st March 2017 it comprises of Mr. Mayank Jhunjhunwala asa Chairman Mr. Prince Tulsian and Mrs. Jyoti Budhia as member of the Committee.

28. NOMINATION & REMUNERATION COMMITTEE & POLICY

The Board has in accordance with the provisions of sub-section (3) of Section 178 ofthe Companies Act 2013 formulated the policy setting out the criteria for determiningqualifications positive attributes independence of a Director and policy relating toremuneration for Directors Key Managerial Personnel and other employees. The detail ofthe same has been disclosed in the corporate governance report.

29. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

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 the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules thereunder for prevention and Redressalof complaints of sexual harassment at workplace. The Company has not received anycomplaint on sexual harassment during the financial year 2016-17.

30. DEMERGER

The Board of Directors of the Company in their meeting held on 22nd June 2017 hasconsidered and approved after recommendation of the Audit Committee a Scheme ofArrangement between the Company and Cheers Consumer Products Limited and their respectiveshareholders and creditors under section 230 to 232 of the Companies Act 2013 fordemerger and vesting of 'Tea' Division of the Company to Cheers Consumer Products Limited.The resulting entity "Cheers Consumer Products Limited " shall also be listed onBSE Limited. The above said Scheme is subject to the approval of SEBI Stock Exchangesshareholders creditors the National Company Law Tribunal and other regulatoryauthorities as applicable.

ACKNOWLEDGEMENT

We thank our Vendors Bankers Statutory Authorities and other Institutions for theircontinued support during the year. We place on record our appreciation of the contributionmade by our employees at all levels.

Our consistent growth was made possible by their hard work solidarity co-operationand support. We also wish to express our gratitude to the Governments of various countrieswhere we have our operations.

For and on behalf of the Board of Directors
Place: Kolkata Vijay Kedia
Chairman
Dated: 12 August 2017 DIN :00230480