The Board of Directors present herewith the 26th Annual Report of the Company togetherwith the Audited Accounts for the year ended 31st March 2018. The ManagementDiscussion and Analysis has also been incorporated into this report.
The highlights of financial results of the company are as follows: -
( Rs. in Lacs )
|Particulars ||For the year ended 31st March 2018 ||For the year ended 31st March 2017 |
|Operating Revenues / Turnover ||2290 ||2648 |
|Profit before Depreciation & Amortization Finance charges ||41 ||150 |
|Depreciation & Amortization ||24 ||31 |
|Finance Charges ||- ||- |
|Profit before tax ||17 ||119 |
|Provision for taxation (incl. deferred tax) ||- ||- |
|Profit after tax ||17 ||119 |
HIGHLIGHTS OF PERFORMANCE
* Operating Revenues for the year decreased by around 13.52 % to Rs. 2290 lacsas compared to Rs. 2648 Lacs in 2016-17
* Profit after tax for the year decreased by around 85.71 % to Rs. 17 lacs as comparedto Rs. 119 lacs in 2016-17. DIVIDEND
In view of the accumulated losses your Directors regret their ability to recommend anydividend for the financial year under review.
During the year under review no amount was transferred to General Reserve.
MANGEMENT DISCUSSION AND ANALYSIS REPORT
As required under Regulation 34 of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 the Management Discussion andAnalysis Report is enclosed as a part of this report.
The paid up Equity Share Capital as at March 312018 stood at Rs.124985500. Duringthe year under review the Company has not issued shares with differential voting rightsnor has granted any stock options as sweat equity. As on March 31 2018 none of theDirectors of the Company hold instruments convertible into equity shares of the Company.
CHANGE IN NATURE OF BUSINESS
The Company mainly deals in the manufacture of thermoware products. There is no changein the nature of the business carrying on by the Company during the year under review.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Your Company has an effective internal control and risk-mitigation system which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is in commensurate with its size scale and complexitiesof its operations. The main thrust of internal audit is to test and review controlsappraisal of risks and business processes besides benchmarking controls with bestpractices in the industry.
The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Company has a Management Information System which is an integral part of thecontrol mechanism.
The Audit Committee of the Board of Directors Statutory Auditors and the BusinessHeads are periodically apprised of the internal audit findings and corrective actionstaken. Audit play a key role in providing assurance to the Board of Directors. Significantaudit observations and corrective actions taken by the management are presented to theAudit Committee of the Board. To maintain its objectivity and independence the internalAudit function reports to the Chairman of the Audit Committee.
FINANCE AND ACCOUNTS
Your Company prepares its financial statements in compliances with the requirements ofthe Companies Act 2013 and the Indian Accounting Standard (IND AS). The financialstatements have been prepared on historical cost basis. The estimates and judgmentsrelating to the financial statements are made on a prudent basis so as to reflect in atrue and fair manner the form and substance of transactions and reasonably present theCompany's state of affairs profits and Cash Flows for the year ended 31stMarch 2018. There is no audit qualification in financial statement by the Statutoryauditors for the year under review.
LOANS GUARANTEES & INVESTMENTS
Details of Loan Guarantees and Investments covered under the provisions of Section 186of the Companies Act 2013 are given in the notes to Financial Statements.
The Company has not accepted any deposit from the public falling within the ambit ofSection 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules2014 or under Chapter V of the Act.
RELATED PARTY TRANSACTIONS
All the Related Party Transactions entered by the Company are on arm's length basis andin the ordinary course of business. All the Related Party Transactions as required underAS-18 are reported in the Notes to the financial statements.
In accordance with the provisions of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has formulated the Related Party Transactionspolicy and the same is uploaded on Company's website at the link : http://www.mplindia.in/category_img/pr_63.pdf
WHISTLE BLOWER POLICY.
The Company has a vigil mechanism to deal with instance of fraud and mismanagement ifany. It ensures that strict confidentiality is maintained whilst dealing with concerns andalso no discrimination will be meted out to any person for a genuinely raised concern. Anysuspected or confirmed incident of fraud / misconduct can be reported thereof.
The Whistle Blower Policy has been posted on website of the Company -http://www.mplindia.in/category_img/pr_64.pdf
RISK MANAGEMENT POLICY
There is a continuous process for identifying evaluating and managing significantrisks faced through a risk management process designed to identify the key risks facingbusiness. During the year a risk analysis and assessment was conducted and no major riskswere noticed.
PERFORMANCE EVALUATION OF BOARD
Pursuant to the provisions of the Companies Act 2013 and Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 the Boardhas carried out an annual performance evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and other Committees. The same is found to be satisfactory.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS': -
At the time of appointing a Director a formal letter of appointment is given to himwhich inter alia explains the role function duties and responsibilities expected of himas a Director of the Company. The Director is also explained in detail the Compliancerequired from him under the Companies Act 2013 Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 and other relevantregulations and affirmation taken with respect to the same.
The Chairman and Whole Time Director also has one to one discussion with the newlyappointed Director to familiarize him with the Company's operations. Further the Companyhas put in place a system to familiarize the Independent Directors about the Company itsproducts business and the on-going events relating to the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Shri Bansilal I. Vaghani and Shri Madhup B. Vaghani Directorsof the Company retires by rotation at the ensuing Annual General Meeting of the Companyand being eligible offers themselves for re-appointment.
As per the Clause 17 (1A) of SEBI (Listing Obligations and Disclosure Requirements)(Amendment) Regulations 2018 Shri Bansilal I. Vaghani can be continued as an nonexecutive Director of the Company subject to your approval by way of passing SpecialResolution being his age is excess of 75 years.
The shareholders are requested to consider his continuation Non executive Director ofthe Company as mentioned in the resolution at item no. 4 of notice of the meeting.
Shri Madhup B. Vaghani was reappointed as a Whole Time Director of the Company by theboard of Directors subject to the approval of the shareholders at the general meeting. Theshareholders are requested to consider his reappointment as mentioned in the resolution atitem no. 5 of notice of the meeting.
The Shareholders are also requested to appoint Mr. Sharad K. Shukla as Independent NonExecutive Directors of the Company and Mrs. Radhika S. Rane as Woman Director of theCompany as mentioned in Item no. 6 and 7 of the notice of the Annual General Meetingrespectively.
The following are the Key Managerial Personnel of the Company:
Shri Madhup B Vaghani : Whole Time Director Shri Pankaj B Bhaya : Chief FinancialOfficer
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under theCompanies Act 2013 and Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015.
Appointment Letters' of Independent Directors and Familiarization Program'process to provide insights of the Company to Independent Directors are hosted on websiteof the Company - http://www.mplindia.in/category_img/pr_123.pdf and http:// www.mplindia.in/category_img/pr_61.pdf
Shri Devendra Negi ceased to be as Independent Director of the Company with effect from26th September 2017
During the year under review the Company has conducted five Board Meetings on thefollowing dates: 29th May 2017 11th August 2017 14thSeptember 2017 12th December 2017 and 14th February 2017. Theintervening gap between the meetings was within the period prescribed under the CompaniesAct 2013.
Messers Bastawala and Associates Chartered Accountants (ICAI Firm Registration Number121789W) was re-appointed as Statutory Auditors of the Company at 25th Annual GeneralMeeting which was held on 25th September 2017 to hold office as StatutoryAuditor from the conclusion of 25th Annual General Meeting till the conclusionof 30th Annual General Meeting (AGM) of the Company subject to ratification bythe Members of the Company at every Annual General Meeting (AGM). Messers Bastawala andAssociates Chartered Accountants is willing to act as a Statutory Auditor of the Companyfor the financial year 2018-19. The Company has received a written consent from themdt.14th August 2018 for their reappointment and also confirmation from the said Auditorsthat they are not disqualified to act as the Auditors and are eligible to hold the officeas Statutory Auditors of the Company.
Further as per the Companies (amendment) Act 2017 the provision of ratification bythe members at every Annual General Meeting has been deleted w.e.f. 7th May2018. Accordingly there is no need to ratify their appointment in the ensuing AnnualGeneral Meeting of the Company.
As required under Section 204 of the Companies Act 2013 Secretarial Audit Reportobtained from Mr. Shailesh Kachalia Practising Company Secretary is annexed and formspart of the Board Report.
OBSERVATIONS - AUDITOR & SECRETARIAL AUDITOR
The Board of Directors observations regarding the qualifications contained in theSecretarial Audit Report are as below :
1. Non-appointment of Company Secretary under the Provisions of Section 203 of theCompanies Act 2013. We would like to state that the Company is taking effective steps toappoint the whole time Company Secretary.
2. The Company has appointed Mr. Pankaj B. Bhaya as Compliance Officer who is notqualified Company Secretary. Once the Company gets appointment of qualified CompanySecretary the company will appoint him as Compliance Officer.
There is no audit qualification in financial statements by the statutory auditors forthe year under review.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return in Form No. MGT-9 as provided under sub-section (3) ofSection 92 of the Companies Act 2013 is annexed and forms part of the Board Report.
MATERIAL CHANGES AND COMMITMENTS
There are no material changes having taken place affecting the financial position ofthe Company from the date of closure of financial year till the signing of Accounts.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS.
There are no significant and material orders passed by the Regulations / courts thatwould impact the going concern status of the Company and its future operations.
ENVIRONMENT AND SAFETY
The Company is conscious of the importance of environmentally clean and safeoperations. The Company's policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances environmental regulations and preservation ofnatural resources.
DISCLOSURE IN TERMS OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company took all necessary measures to ensure a harassment free workplace and hasinstituted an Internal Complaints Committee for redressal of complaints and to preventsexual harassment. No complaints relating to sexual harassment were received during theyear.
As per Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 a separate section on Report on CorporateGovernance' practices followed by the Company together with a certificate from thePractising Company Secretary confirming compliances forms integral part of this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134 (3) (c) of the Companies Act 2013:
a. that in the preparation of the annual financial statements for the year ended 31stMarch 2018 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b. that such accounting policies as mentioned in the Notes to the Financial Statementshave been selected and applied consistently and judgement and estimates have been madethat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company as at 31st March 2018 and of the profit of the Company for theyear ended on that date;
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. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;
f. that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
CONSERVATION OF ENERGY RESEARCH & DEVELOPMENT TECHNOLOGY ABSORPTION
A) Conservation of Energy:-
a) The Company has taken all measures to conserve the Energy by installing latestequipments for conservation of Energy.
b) The cumulative effect of the Energy conservation steps taken by the Company hasconsiderably reduced the consumption of Energy and saved the cost of the Company.
B) Information relating to Technology absorption
1. Research & Development (R & D)
(a) Specific areas in which R & D is carried out by the Company.
New product development New manufacturing process development Product upgradationCost reduction Mould designing and development New application of thermoware productWater Purification System.
(b) Benefits derived as a result of the R & D.
(i) Company is in a position to introduce varied new products every year to meetchanging consumer preferences.
The Company is in position to cater to a wider segment of consumer durables andplastics based industrial products.
(c) Future Plan of Action.
(i) Emphasis is being laid on development & marketing of new product and valueaddition to existing range of products for both export as well as domestic market.
(ii) Business Process Re - Engineering.
(d) Expenditure on Research & Development under the head product Design &Development Expenses is being accounted under relevant heads of expenses.
2. Technology Absorption Adaptation and Innovation.
(a) Efforts in brief made towards technology absorption adaptation and innovation asenumerated in Clause 1 above.
(b) Benefits derived as a result of the above efforts product up gradation costreduction & new products developments as enumerated in Clause 1 above.
C) FOREIGN EXCHANGE EARNINGS AND OUT GO:
Foreign exchange spent Rs. NIL
Foreign exchange earned Rs. NIL.
CORPORATE SOCIAL RESPONSIBILITY
The Company firmly believes that the industry owes duty of welfare to the society atlarge and it shall pursue the commitment of Social Responsibility and carry out the socialwork directly and/or through other registered welfare organizations.
The Company has no prescribed average net profits networth and turnover as per theprovisions of Section 135 of the Companies Act 2013. The Company has carried forwardlosses.
The Company voluntarily re-constituted Corporate Social Responsibility Committee (CSR)on 12th December 2017 consisting of the following members.
|SHRI BANSILAL I. VAGHANI ||: Member |
|SHRI VIREN V. BHIMANI ||: Chairman |
|SHRI SHARAD K. SHUKLA ||: Member |
The terms of reference of Corporate Social Responsibility Committee (CSR) broadlycomprises of following :
(a) Formulate and Recommendation of CSR Policy to the Board indicating the activitiesto be undertaken by the Company as specified in Schedule VII of Companies Act 2013.
(b) Recommend the amount of expenditure to be incurred on the activities referred to inclause(a).
(c) Provide guidance on various CSR activities to be undertaken by the Company and tomonitor its progress.
During the year under review the Committee met once to deliberate on various mattersreferred above. The details of attendance of the members is as below.
|Name of the Director ||Attended |
|SHRI BANSILAL I. VAGHANI ||1 out of 1 |
|SHRI VIREN V. BHIMANI ||1 out of 1 |
|SHRI SHARAD K. SHUKLA ||- |
In view of the average net profit turn over net worth of the Company not qualified bythe provisions of the Section 135 of the Companies Act 2013 the Committee did notrecommend the spending any amount towards the CSR activities.
The Audit committee was re-constituted on 12th December 2017.
The Audit Committee is headed by Shri Viren V. Bhimani as Chairman of the committee.Shri Sharad K. Shukla and Shri Bansilal I. Vaghani as Members. The details of all relatedparty transactions if any are placed periodically before the Audit Committee. During theyear there were no instances where the Board had not accepted the recommendations of theAudit Committee.
NOMINATION AND REMUNERATION COMMITTEE
Nomination and Remuneration Committee was re-constituted on 12th December2017.
The Nomination and Remuneration Committee comprises of three Directors. Shri Bansilal IVaghani Shri Viren V. Bhimani and Shri Sharad K. Shukla Non Executive IndependentDirector Shri Viren V. Bhimani is the Chairman of the Committee. The Composition ofNomination and Remuneration committee is pursuant to the provisions of Section 178 of theCompanies Act 2013 and Clause 19 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015
Meeting and Attendance
The Nomination and Remuneration Committee met on 14th February 2018. Thenecessary quorum was present. The Chairman of the Nomination and Remuneration Committeewas present at the last Annual General Meeting of the Company.
Terms of Reference :
The Committee shall :
1. Formulate the criteria for determining qualifications positive attributes andindependence of a director.
2. Identify persons who are qualified to become Director and persons who may beappointed in Key Managerial and Senior Management positions in accordance with thecriteria laid down in this policy.
3. Recommend to the Board appointment and removal of Director KMP and SeniorManagement Personnel.
DETAILS OF REMUNERATION PAID TO DIRECTORS FOR THE YEAR ENDED MARCH 31 2018
The Company has not paid any remuneration to Whole Time Director.
The Company reimburses the out of pocket expenses incurred by Directors of the Companyafter the review of the same by the Committee members.
The remuneration policy is directed towards rewarding performance based review ofachievements. It is aimed at attracting and retaining high calibre talent.
Refer http://mplindia.in/category_imp/pr_59.pdf regarding Remuneration policy of theCompany.
Particulars of the Company's Remuneration Policy and information required under Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014and particulars of remuneration required under Section 197 of the Companies Act 2013 readwith Rules 5(2) of the companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of Directors / Employees of the Company are set out in the annexureforming part of this report.
STAKEHOLDERS RELATIONSHIP COMMITTEE
The Company reconstituted Stakeholders Relationship Committee on 12thDecember 2017
The Committee is headed by Shri Viren V. Bhimani as Chairman of the committee. ShriSharad K. Shukla and Shri Bansilal I. Vaghani as Members.
PARTICULARS OF EMPLOYEES
No employee of the Company is receiving remuneration as per the limits prescribed inSection 197 read with Rule 5 of The Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.
SUBSIDIARY/JOINT VENTURE/ASSOCIATE COMPANIES
Company doesn't have any Subsidiaries or Joint Ventures or Associate companies as onthe report date as defined under the Companies Act 2013.
CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe Company. The Code has been placed on the Company's website www. mplindia.in
The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. All the Board Members and the Senior Management personnelhave complied compliance with the Code.
Statements in this report describing the Company's objectives projections estimatesexpectations or predictions may be forward looking statements considering the applicablelaws or regulations. These statements are based on certain assumptions and expectations offuture events. Actual results could however differ materially from those expressed orimplied. Important factors that could make a difference to the Company's operationsinclude global and domestic demand - supply conditions. Finished goods prices rawmaterials cost and availability fluctuations in exchange rates change in Governmentregulations and tax structure within India and the countries with which the Company hasbusiness contacts and other factors such as litigation and industrial relations.
Your Directors would like to express their grateful appreciation for the assistance andco-operation received from all organizations connected with its business during the yearunder review. Your Directors also wish to place on record their deep sense of appreciationfor the committed services of Executives and Staff of the Company. Your Directors are alsodeeply grateful for the confidence and faith shown by the Shareholders of the Company inthem.
BY ORDER OF THE BOARD
For MPL PLASTICS LIMITED