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Madhav Copper Ltd.

BSE: 538398 Sector: Metals & Mining
NSE: MCL ISIN Code: INE813V01022
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Madhav Copper Ltd. (MCL) - Director Report

Company director report

Dear members

Your Directors have pleasure in presenting the 7th Annual Report on the business andoperations of the Company and the Audited Accounts for the Financial Year ended 31st March2019.

1. SUMMARY OF FINANCIAL RESULTS:

(Amount in Rupees)
Particulars Current Year Previous Year
2018-19 2017-18
Net Sales/Income from Business operations 2128774856 1688193679
Other Income 649670 2387397
Total income 2129424525 1690581076
Less: Expense (Excluding depreciation) 2052511445 1652464061
Profit before Depreciation 76913080 38117015
Less: Depreciation 17724556 6607763
Profit before Tax 59188524 31509252
Add: Exceptional item -- 481755
Profit before Tax 59188524 31991007
Less: Current tax 18000000 9010000
Less: Deferred tax 4595566 (425070)
Less : Excess Provision of earlier years 176250 (270748)
Net Profit/ (Loss) after Tax for the year 36416708 23676825
Balance carried to the Balance Sheet 36416708 23676825
Earnings per share(Basic & Diluted) 5.91 11.53

2. DIVIDEND:

With a view to finance expansion from internal accrual for the growth of the Companythe directors do not recommend any dividend for the year ended March 31 2019.

3. OPERATIONAL HIGHLIGHTS AND PROSPECTS:

Operational highlights:

The Company earned operational income of 2128774856 compared to 1688193679 in theprevious year. The other income is 649670 compared to 2387397 in the previous year.

Profit after tax for the year under review is 36416708 as compared to previous yearfigure of 23676825.

4. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company does not have any Subsidiary Joint venture or Associate Company.

5. CREDIT FACILITIES:

The Company has been optimally utilizing its ‘fund based’ and ‘non-fundbased’ working capital requirements as tied up with Bank of Baroda Axis Bank Limitedand Aditya Birla Finance Limited. During the year under review the Company wascomfortable in meeting its financial requirements. Effective financial measures have beencontinued to reduce cost of interest and bank charges.

6. SHARE CAPITAL AND CHANGES:

Changes in Share Capital during the year under review are as follow:

Buy-back of Securities:

The Company has not bought back any of its securities during the year under review.

Sweat Equity:

The Company has not issued any Sweat Equity Shares during the year under review.

Bonus Shares:

The Company has issued and allotted 4107200 (Forty One Lakh Seven Thousand TwoHundred) Equity shares of 10/- (Rupees Ten Only) each as bonus shares during the yearunder review.

Employees Stock Option Plan:

The Company has not provided any Stock Option Scheme to the employees.

7. MATERIAL CHANGES:

There are no significant events affecting the financial position between the end of thefinancial year and date of the Report except following-

Sub division of shares: In order to improve the liquidity ofCompany’s equity shares in the Stock Markets with higher floating stock in absolutenumbers and to make it more affordable for the small retail investors to invest in theCompany the Company has sub-divided the face value of the equity shares of the Companyfrom Rs. 10/- each to Rs. 5/- each.

Lot size of shares: Lot size of the Company’s shares has beenreduced from 2400 shares to 600 shares by NSE w.e.f 5th August 2019.

8. CAPITAL EXPENDITURE FOR EXPANSION PROJECT:

As mentioned in previous report the Company was undergoing an expansion andaccordingly the Company has completed installation of copper Furnace in November 2018 fornew products. The Company proudly announces that the production through such furnace isalready started.

However the Company has not incurred any capital expenditure for expansion during theyear under review.

9. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to conservation of energy technology absorption Foreignexchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is furnished in AnnexureI and is enclosed to this report.

10. RISK MANAGEMENT:

The Company has framed a sound Risk Management Policy to identify and evaluate businessrisks and opportunities and the same has become integral part of the Company’s day today operations. The key business risks identified by the Company are Industry riskManagement and Operations risk Market risk Government policy risk Liquidity risk andSystems risk. The Company has in place adequate mitigation plans for the aforesaid risks.The Policy on Risk Management is available on website of the Company under tab InvestorInfo/Policies/Risk Management Policy.

11. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

The Corporate Social responsibility provisions are now applicable to the Company.Accordingly the Company has constituted Corporate Social Responsibility Committee (CSRCommittee).

12. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THECOMPANIES ACT 2013:

Loans guarantees or investments made by the Company under Section 186 of the CompaniesAct 2013 form part of the Notes to the financial statements provided in this AnnualReport.

13. RELATED PARTY TRANSACTIONS:

There were materially significant related party transactions with the Company’sPromoters Directors Management or their relatives which could have had a potentialconflict with the interests of the Company. All transactions entered into with the relatedparties are occurred at Arms’ length price and in ordinary course of business.Transactions with related parties entered by the Company in the normal course of businessare periodically placed before the Audit Committee for its omnibus approval and theparticulars of contracts entered during the year as per Form AOC-2 is enclosed as AnnexureII.

The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its relatedparties in compliance with the applicable provisions of the Companies Act 2013 the rulesmade thereunder and the SEBI (Listing Obligation and Disclosure Requirement) Regulation2015. This policy was considered and approved by the Board and has been uploaded on thewebsite of the Company at www.madhavcopper.com under Investors/ Policies/Policy on RelatedParty Transactions.

14. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL:

During the year under review there were no changes in the Directors and Key ManagerialPersonnel.

Composition of Board of Directors:

Thus the Board of Directors of Company is a balanced one with an optimum mix ofExecutive and Non Executive Directors. They show active participation at the board andcommittee meetings which enhances the transparency and adds value to their decisionmaking. The Board of the Company is headed by an Executive Chairman. Chairman takes thestrategic decisions frames the policy guidelines and extends wholehearted support toExecutive Directors business heads and associates.

As on 31st March 2019 the Board of Company consists of Six (6) Directors.

(a) The composition and category of Directors as well as other details are as follow:

Sr. No. Name of Director Category DIN No. of Board Meeting attended during the year under review Whether attended last AGM No. of membership in committee in other Public Limited Company
1 Mr. Nilesh N. Patel Promoter & Chairman 05319890 9 YES NIL
2 Mr. Rohitbhai B. Chauhan Promoter & Managing Director 06396973 8 YES NIL
3 Mr. Divya Monpara Promoter & Non- Executive Director 06396970 8 YES NIL
4 Mrs. Rakshaben R. Chauhan Non Executive Director 07600985 7 YES NIL
5 Mr. Manish Makodia Non Executive & Independent Director 07600988 9 YES NIL
6 Mr. Chaitnya Doshi Non Executive & Independent Director 07600986 7 YES NIL

(b) The dates of the meeting of Board held during the year under review are as follow:

Sr. No. Date of Board Meeting

Total strength of Board

No. of Directors present

1 28th May 2018 6 6
2 4th August 2018 6 6
3 7th September 2018 6 4
4 28th September 2018 6 5
5 5th November 2018 6 4
6 14th November 2018 6 5
7 7th February 2019 6 6
8 19th March 2019 6 6
9 31st March 2019 6 6

Notes:

(i) Directorships exclude Private Limited Companies Foreign Companies and Section 8Companies.

(ii) Chairmanship/Membership of Committee only includes Audit Committee andStakeholders’ Relationships Committee in Indian Public Limited companies other thanMadhav Copper Limited. Members of the Board of the Company do not have membership of morethan ten Board-level Committees or Chairperson of more than five such Committees.

(iii) None of the directors are related to each other except Mr. Rohitbhai Chauhan andMrs. Rakshaben Chauhan are related to each other.

(iv) Details of Director(s) retiring or being re-appointed are given in notice toAnnual General Meeting.

(v) Brief profiles of each of the above Directors are given in the beginning of thereport.

14.1 Board Evaluation:

Pursuant to the provisions of the Companies Act 2013 and Regulation 17(10) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board has carriedout an annual performance evaluation of its own performance the directors individually aswell as the evaluation of the working of its Audit Nomination and Remuneration andCompliance Committees.

14.2 Board Committees and their Meetings:

The Company has the following Committees of the Board along with details of itscompositions.

Sr. No. Name of Committee Members
1 Audit Committee Mr. Manish Makodia - Chairman
Mr. Chaitanya Doshi - Member
Mr. Nilesh Patel - Member
2 Nomination And Remuneration Committee Mr.Manish Makodia - Chairman
Mr. Chaitanya Doshi - Member
Mrs. Rakshaben Chauhan - Member
3 Stakeholders Relationship Committee Mr. Chaitanya Doshi - Member
Mr.Manish Makodia - Chairman
Mrs. Rakshaben Chauhan - Member

During the year under review following meetings were held and the details of membersattended meetings are given below:

Audit Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Manish Makodia Independent Director 4 4
Mr. Chaitnya Doshi Independent Director 4 4
Mr. Nilesh Patel Whole-time director 4 4

Nomination and Remuneration Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Manish Makodia Independent Director 2 2
Mr. Chaitnya Doshi Independent Director 2 2
Mrs. Rakshaben Chauhan Non Executive Director 2 2

Stakeholders Relationship Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Chaitnya Doshi Independent Director 2 2
Mr. Manish Makodia Independent Director 2 2
Mrs. Rakshaben Chauhan Non Executive Director 2 2

14.3 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 Policy on Nomination and Remuneration is available on the website of theCompany under Investor Info/Policies/Nomination and Remuneration Policy.

14.4 Code of Conduct:

The Board has laid down a Code of Conduct for all Board Members and Senior Managementof the Company which is posted on the website of the Company under InvestorInfo/Policies/Code of Conduct. All Board Members and Senior Management Personnel haveaffirmed compliance with the Code on an annual basis.

14.5 Insider Trading:

The Board has in consultation with the Stakeholders’ Relationship Committee laiddown the policy to regulate and monitor Insider Trading. The Committee regularly analyzesthe transactions and monitors them to prevent Insider Trading. The policy on InsiderTrading is available on the website of the Company under Investor Info/Polices/Code ofConduct for prevention of Insider Trading Policy.

14.6 Meetings:

During the year 9 Board Meetings 4 Audit Committee Meetings 2 Nomination andremuneration Committee Meetings and 2 Stakeholders Relationship Committee Meetings wereheld. The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013. Details of Meetings are given under respective heads.

14.7 Declaration of Independent Directors:

The Independent Directors have submitted their disclosures to the Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013 soas to qualify themselves to be appointed as Independent Directors under the provisions ofthe Companies Act 2013 and the relevant rules.

14.8 Familiarisation Programme for Independent Director:

The Company has made practice of regularly informing the Directors all the changes inthe Company as well as changes in laws which are applicable to the Company at Boardmeeting held during theyear.

15. WHITSLE BLOWER & VIGIL MECHANISM:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished. The Vigil Mechanism Policy has been uploaded on the website of the Company atwww.madhavcopper.com under Investors/policies/Vigil Mechanism Policy link.

16. DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134(5) of the Companies Act 2013 theBoard hereby submits 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) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

17. ANNUAL RETURN:

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule12 of the Companies (Management and administration) Rules 2014 is furnished in AnnexureIII and the same is enclosed to this Report. This report is also available on thewebsite of the Company at www.madhavcopper.com.

18. DEPOSITS:

The Company has neither accepted nor renewed any deposits during the year under review.

19. AUDITORS & AUDITORS’ REPORT:

Statutory Auditors:

M/s. Nirav Patel & Co. Chartered Accountants were appointed as Statutory Auditorsof your Company at the Annual General Meeting held on 8th August 2017 for a term of fiveconsecutive years. In accordance with the Companies Amendment Act 2017 enforced on 7thMay 2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors isnot required to be ratified at every Annual General Meeting. The Report given by theAuditors on the financial statement of the Company is part of this Report. There has beenno qualification reservation adverse remark or disclaimer given by the Auditors in theirReport.

Statutory Auditors’ Report:

The observation made in the Auditors' Report read together with relevant notes thereonare self explanatory and hence do not call for any further comments under Section 134 ofthe Companies Act 2013.

There is no qualification reservations or adverse remarks made by the Auditors.

Secretarial Auditor:

M/s. Kashyap Shah & Co. Company Secretaries in practice Vadodara (COP No. 6672)was appointed as a Secretarial Auditor of the Company to conduct Secretarial Audit for thefinancial year 2018-19 as required under Section 204 of the Companies Act 2013 and Rulesthere under.

Secretarial Auditor’s Report:

The Secretarial Audit Report for the financial year ended 31st March 2019 isself-explanatory and does not call for any further comments.

There is no qualification reservations or adverse remarks made by the Auditors.

The Secretarial Audit Report for the financial year ended March 31 2019 is annexedherewith marked as Annexure IV to this Report.

Internal Auditor:

As per Section 138 of Companies Act 2013 every Listed Company is required to appointan Internal Auditor or a firm of Internal Auditors.

The Board of directors are pleased to confirm the appointment of M/s. Nirav Shah &Co. as Internal Auditors of the Company.

Cost Auditor:

M/s. S. K. Rajani & Co. Cost Accountants have been appointed to conduct Cost Auditof the Company for the year ending 31st March 2020. Pursuant to the provisions of Section148 of the Act read with the Companies (Audit and Auditors) Rules 2014 members arerequested to consider the ratification of the remuneration payable to M/s. S. K. Rajani& Co.

The remuneration of Cost Auditors has been approved by the Board of Directors on therecommendation of Audit Committee. The requisite resolution for ratification ofremuneration of Cost Auditors by members of the Company has been set out in the Notice ofensuing Annual General Meeting. The Cost Auditors have confirmed that their appointment iswithin the limits prescribed u/s 141(3)(g) of the Companies Act 2013 and that they arenot disqualified from being appointed within the meaning of the said Act.

GST Auditor

The Board of directors are pleased to confirm the appointment of M/s. Nirav Shah &Co. as GST Auditors of the Company for FY 2018-19.

20. INTERNAL CONTROL S STEM AND THEIR ADEQUACY:

The Company has adequate system of internal control to safeguard and protect from lossunathorised use or disposition of its assets. All the transactions are properlyauthorized recorded and reported to the Management. The Company is following all theapplicable Accenting Standards for properly maintaining the books of accounts andreporting financial statements. The internal auditor of the Company checks and verifiesthe internal control and monitors them in accordance with policy adopted by the Company.

The Company continues to ensure proper and adequate systems and procedures commensuratewith its size and nature of its business.

21. MARKET PRICE OF SHARES OF THE COMPANY DURING THE YEAR UNDER REVIEW:

Month High (Amount ) Low (Amount )
April 2018 283.50 246.00
May 2018 430.00 279.00
June 2018 412.00 355.80
July 2018 395.00 343.90
August 2018 437.00 328.70
September 2018 457.80 137.00
October 2018 154.00 134.25
November 2018 152.00 134.00
December 2018 151.80 135.00
January 2019 212.10 148.00
February 2019 317.00 200.00
March 2019 358.00 296.25

22. PARTICULARS OF EMP OYEES:

None of the employee has received remuneration exceeding the limit as stated in Section197 of the Companies Act 2013 read with Rule 5 of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014.

23. HUMAN RESOURCES:

During the period under review the personal and industrial relations with theemployees remained cordial in all respects. The management has always carried outsystematic appraisal of performance and imparted training at periodic intervals. TheCompany recognizes talent and has judiciously followed the principle of rewardingperformance.

24. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:

The Company has zero tolerance for sexual harassment at its workplace. The Company hasadopted an Anti-harassment Policy in line with the requirements of the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013. InternalComplaint Committee are set up to redress complaints received regularly and are monitoredby women line supervisors who directly report to the Chairman & Managing Director. Allfemale employees are covered under the policy. There was no complaint received from anyemployee during the financial year 2018- 19 and hence no complaint is outstanding as onMarch 31 2019 for redressal.

25. DETAILS OF SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

There were no material orders passed by the regulators or court or tribunals impactingthe going concern status and company’s operations in future.

26. ACKNOWLEDGEMENTS:

Your Directors place on record their sincere thanks to bankers business associatesconsultants and various Government Authorities for their continued support extended toyour Companies activities during the year under review. Your Directors also acknowledgegratefully the shareholders for their support and confidence reposed on the Company.

For and on behalf of the Board of Directors of
MADHAV COPPER LIMITED
SD/- SD/-
Nilesh Patel Rohit Chauhan
Chairman & WTD Managing Director
DIN: 05319890 DIN:06396973
Place: Bhanvagar
Date: 30th August 2019