You are here » Home » Companies » Company Overview » Nuway Organic Naturals India Ltd

Nuway Organic Naturals India Ltd.

BSE: 531819 Sector: Others
NSE: N.A. ISIN Code: INE414L01012
BSE 05:30 | 01 Jan Nuway Organic Naturals India Ltd
NSE 05:30 | 01 Jan Nuway Organic Naturals India Ltd

Nuway Organic Naturals India Ltd. (NUWAYORGANIC) - Director Report

Company director report

TO THE MEMBERS OF NUWAY ORGANIC NATURALS INDIA LIMITED

The Directors of your company have pleasure in presenting the 22nd AnnualReport together with Audited Accounts of the company for the financial year ended 31stMarch 2017.

FINANCIAL HIGHLIGHTS

Standalone (Rs. In Crores)
Particulars 2016-17 2015-16
Gross Income 17.39 39.33
Profit /Loss Before Interest and Depreciation -2.12 4.19
Finance Charges 2.78 2.99
Depreciation & Amortization Expenses 3.84 4.59
Profit /Loss Before Tax -8.74 -3.39
Provision for Tax 0.00 0.00
Tax adjustments for earlier years 0.00 0.14
Net Profit/Loss After Tax -8.74 -3.53
Profit/Loss carried to Reserve & Surplus Account -8.74 -3.53

STATE OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK

Turnover of the stood at Rs. 17.39 crores and the Company has suffered a loss to thetune of Rs. 8.74 crores as compared to the previous year turnover of Rs. 39.33 crores anda loss of Rs. 3.53 crores. The Company has suffered losses as sale of Company's productswas less and cost of production was more as compared to the other manufactures. TheCompany is making efforts to reduce cost of production to increase the turnover of theCompany in future.

CHANGE IN NATURE OF BUSINESS

There is no change in the nature of business activities of the Company.

DIVIDEND

The Company has suffered huge losses during the financial year under report and Boardof Directors of the company has not recommending any dividend this year.

AMOUNTS TRANSFERRED TO RESERVES

The Board of the company has decided to carry loss of Rs. 8.74 crores to its reservesand surplus account.

CHANGES IN SHARE CAPITAL IF ANY

There has been no change in Share Capital of the Company during the Financial Year2016-17.

INFORMATION ABOUT SUBSIDIARY/ JV/ ASSOCIATE COMPANY

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

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid last year and there is no unclaimed dividend.

MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments affecting the financial position of the Companyoccurred between the period from the end of the financial year to which this financialstatement relate and on the date of this report.

EXTRACT OF ANNUAL RETURN

The Extract of Annual Return as required under section 92(3) of the Companies Act 2013and rule 12(1) of the Companies (Management and Administration) Rules 2014 in Form MGT-9is annexed herewith for your kind perusal and information.

MEETINGS OF THE BOARD OF DIRECTORS

During the current Financial Year the Company held 8 meetings of the Board ofDirectors as per Section 173 of Companies Act 2013 which is summarized below. Theprovisions of Companies Act 2013 and listing agreement were adhered to while consideringthe time gap between two meetings.

11.04.2016 06.06.2016 19.08.2016 10.10.2016 21.11.2017
27.12.2017 25.01.2017 21.02.2017

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors of theCompany confirms that- (a) In the preparation of the annual accounts the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures; (b) The directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period; (c) Thedirectors had taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of thecompany and for preventing and detecting fraud and other irregularities; (d) The directorshad prepared the annual accounts on a going concern basis; and (e) The directors had laiddown internal financial controls to be followed by the company and that such internalfinancial controls are adequate and were operating effectively. (f) The directors haddevised proper systems to ensure compliance with the provisions of all applicable laws andthat such systems were adequate and operating effectively.

AUDITORS AND REPORT THEREON

M/s. Miglani Rakesh & Associates Chartered Accountants Rajpura was appointed asStatutory Auditors for a period of four years in the Annual General Meeting held on 30thSeptember 2014. Their continuance of appointment and payment of remuneration are to beconfirmed and approved in the ensuing Annual General Meeting. There are somequalifications/adverse remarks in the Auditors' Report detail of qualifications and theexplanation by the Board of Directors is given as an attachment to the report. The Noteson financial statements are self-explanatory and needs no further explanation. Furtherthe Auditors' Report for the financial year ended

31st March 2017 is annexed herewith for your kind perusal and information.

LOANS GUARANTEES AND INVESTMENTS

There were no loans guarantees or investments made by the Company under Section 186 ofthe Companies Act 2013 during the year under review and hence the said provision is notapplicable.

RELATED PARTY TRANSACTIONS

The Company has entered into various Related Parties Transactions in ordinary course ofbusiness at arm' s length as defined under Section 188 of the Companies Act 2013 withrelated parties as defined under Section 2 (76) of the said Act. Further all the necessarydetails of transaction entered with the related parties are attached herewith in FormNo.AOC-2 for your kind perusal and information.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO

The Information pursuant to Section 134(3) (m) pertaining to Conservation of EnergyTechnology Absorption and Foreign Exchange Outgo is provided in annexure herewith.

RISK MANAGEMENT

The Company does not have any Risk Management Policy as the element of risk threateningthe Company's existence is very minimal.

DIRECTORS AND KMP

During the current financial year no changes have occurred in the constitution of Boardof Directors and KMP of the company.

DEPOSITS

The company has not accepted any deposits from the public during the year and there areno unclaimed deposits.

RATIO OF REMUNERATION TO EACH DIRECTOR

The information required pursuant to Section 134(3) and Section 197(12) read with Rule5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014in respect of employees of the Company and Directors is attached herewith. Furtherinformation required under Rule 5 (2) of The Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is nil as no employee of the Company is in receipt ofremuneration as stated therein.

ANNUAL EVALUATION

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Audit Nomination & Remuneration Committee. Aseparate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgment safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Secretarial Department.

CORPORATE GOVERNANCE

Report on Corporate Governance along with the Certificate of M/s. Rajesh K Sharma andAssociates Chartered Accountants Ludhiana confirming compliance of conditions ofCorporate Governance as stipulated in the Listing Agreement with the Stock Exchanges formspart of the Board Report. According to Schedule V Part II Section II point IV states that:a)The remuneration package of the directors are as follows:

Name of Director Anchal Narang
Salary 2400000/-
Bonus/ Stock Options/ Pension/ Medical Reimbursment Nil

b)Performance linked incentives- Nil c) Service contracts notice period servantfees- Nil d) Stock option details- Nil

INDEPENDENT DIRECTORS AND DECLARATION

Sh. Surinder Ahuja and Mrs. Ginny Singh were appointed as independent directors byshareholders on 30th September 2014 and the Board of Directors of the Companyhereby confirms that all the Independent directors duly appointed by the Company havegiven the declaration and they meet the criteria of independence as provided under section149(6) of the Companies Act 2013.

NOMINATION AND REMUNERATION COMMITTEE

As per the section 178(1) of the Companies Act 2013 the Company's Nomination andRemuneration Committee comprises of three Non-executive Directors. The table sets out thecomposition of the Committee as on 31.03.2017:

Name of the Director Position held in the Committee Category of the Director
1 Mrs. Ginny Singh Chairman Non Executive / Independent Director
2 Sh. Surinder Ahuja Member Non Executive / Independent Director
3 Sh. Manminder Singh Narang Member Non Executive / Promoter Director

The date of meetings of committee and attendance of members is given in report oncorporate governance attached with the report.

Terms of Reference

The Terms of Reference of the Nomination and Remuneration Committee are as under:

1. To identify persons who are qualified to become Directors and who may be appointedin senior management in accordance with the criteria laid down recommend to the Boardtheir appointment and removal and shall carry out evaluation of every Director'sperformance.

2. To formulate the criteria for determining qualifications positive attributes andindependence of a Director and recommend to the Board a policy relating to theremuneration for the Directors Key Managerial Personnel and other employees.

3. The Nomination and Remuneration Committee shall while formulating the policy ensurethat: a. the level and composition of remuneration is reasonable and sufficient toattract retain and motivate Directors of the quality required to run the Companysuccessfully; b. relationship of remuneration to performance is clear and meetsappropriate performance benchmarks; and c. remuneration to Directors Key ManagerialPersonnel and senior management involves a balance between fixed and incentive payreflecting short and long-term performance objectives appropriate to the working of thecompany and its goals:

4. Regularly review the Human Resource function of the Company

5. Discharge such other function(s) or exercise such power(s) as may be delegated tothe Committee by the Board from time to time.

6. Make reports to the Board as appropriate.

7. Review and reassess the adequacy of this charter periodically and recommend anyproposed changes to the Board for approval from time to time.

8. Any other work and policy related and incidental to the objectives of the committeeas per provisions of the Act and rules made there under.

REMUNERATION POLICY Remuneration to Executive Directors

The remuneration paid to Executive Directors is recommended by the Nomination andRemuneration Committee and approved by Board in Board meeting subject to the subsequentapproval of the shareholders at the General Meeting and such other authorities as may berequired. The remuneration is decided after considering various factors such asqualification experience performance responsibilities shouldered industry standards aswell as financial position of the Company. Remuneration to Non Executive Directors The NonExecutive Directors have not been paid any sitting fees during the year under report.

AUDIT COMMITTEE

According to Section 177 of the Companies Act 2013 the company's Audit Committeecomprised of three directors. The board has accepted the recommendations of the AuditCommittee. The table sets out the composition of the Committee as on 31.03.2017:

Name of the Director Position held in the Committee Category of the Director
1 Mrs. Ginny Singh Chairman Non Executive / Independent Director
2 Sh. Surinder Ahuja Member Non Executive / Independent Director
3 Sh. Manminder Singh Narang Member Non Executive / Promoter Director

The date of meetings of committee and attendance of members is given in report oncorporate governance attached with the report.

SECRETARIAL AUDIT REPORT

There are no qualifications or adverse remarks in the Secretarial Audit Report whichrequire any clarification/ explanation. Further the Secretarial Audit Report as providedby Ravinder Kumar Practicing Company Secretary for the financial year ended 31st March2017 is annexed herewith for your kind perusal and information.

VIGIL MECHANISM

As per Section 177(9) and (10) of the Companies Act 2013 and as per requirements ofthe Listing Agreement the company has established Vigil Mechanism for directors andemployees to report genuine concerns and made provisions for direct access to thechairperson of the Audit Committee. Company has formulated the present policy forestablishing the vigil mechanism/ Whistle Blower Policy to safeguard the interest of itsstakeholders Directors and employees to freely communicate and address to the Companytheir genuine concerns in relation to any illegal or unethical practice being carried outin the Company. The details of the Vigil Committee are annexed herewith for your kindperusal and information.

SHARES a. buy back of securities-The Company has not bought back any of its securitiesduring the year under review. b. sweat equity-The Company has not issued any Sweat EquityShares during the year under review. c. bonus shares-No Bonus Shares were issued duringthe year under review. d. employees stock option plan-The Company has not provided anyStock Option Scheme to the employees.

ORDER OF COURT

There is no significant and material order passed by the regulators or courts orTribunals impacting the going concern status and company's operation in future.

DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS

The Company has in place ‘Internal Financial Control Policy' and that InternalFinancial Controls are in line with the policy and are adequate and are operatingefficiently. The Company is adhering to Internal Financial Controls which commensuratewith its size and operations.

SHARES IN SUSPENSE ACCOUNT i. Aggregate number of shareholders and the outstandingshares in the suspense account lying at the beginning of the year=nil ii. Number ofshareholders who approached issuer for transfer of shares from suspense account during theyear=nil iii. Number of shareholders to whom shares were transferred from suspense accountduring the year=nil iv. aggregate number of shareholders and the outstanding shares in thesuspense account lying at the end of the year=nil

SHARES IN UNCLAIMED SUSPENSE ACCOUNT i. Aggregate number of shareholders and theoutstanding shares lying in the Unclaimed Suspense

Account at the beginning of the year=nil ii. Number of shareholders who approached theissuer for transfer of shares from the Unclaimed Suspense

Account during the year=nil iii. Number of shareholders to whom shares were transferredfrom the Unclaimed Suspense Account during the year=nil iv. Aggregate number ofshareholders and the outstanding shares lying in the Unclaimed Suspense

Account at the end of the year=nil

MATERIAL VARIATIONS

The material variations between the projections and the actual utilization are notapplicable:

CODE OF CONDUCT

The Code of Conduct of Nuway Organic Naturals India Limited is attached herewith.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT 1. Industry structure and developments

The Company engaged in the manufacture of cosmetics products and Liquor in India. Italso involves in trading of cosmetics bottled soda soft drinks and packaging drinkingwater. The Company is based in Rajpura and it expanded its distillery at Devinagar TehsilRajpura and District Patiala in the state of Punjab with an investment of Rs. 400 million.The project involves distillery unit with a capacity of 45 kilo litres per day with changeof spent wash treatment technology from Bio-methanation followed by secondary aerationfollowed by Ferti-irrigation to Decantation and evaporation. It manufactures Extra NeutralAlcohol (ENA) and bottling of liquors. The distillery consumes grains like broken RiceBajra and Jowar as raw materials which is readily available in Punjab. The

Company produces ENA finished products like vodka health drinks and IMFL DML PMLetc. It plans to supply ENA to the pharmaceutical industry also. 2. Opportunities andthreats The liquor industry is growing at 8% and Indian liquor market is veryunder-penetrated as compared to other foreign markets. Growth opportunities are very highin this business. The Company is aggressively looking at domestic market as well as exportmarket for marketing of the Company products. However company faces competition frommanufacturers of Indian as well as international brands. 3. Segment wise or product wiseperformance The major source of earning of the Company is from manufacture and sale ofliquor and earnings from trading of cosmetics bottled soda soft drinks and packagingdrinking water amounts to less than ten percent. 4. Outlook Your Company is making allefforts to accelerate the growth of its business. The plant is setup for distillery withstorage facilities for the grains and equipped with latest technology machinery. TheCompany has setup state-of-the-art potable alcohol unit with a production capacity of 45Kilolitre per day. Your Directors are optimistic about the future prospects of theCompany.

5. Risks and concern

The Company is exposed to the market risks like change in demand availability of rawmaterial and the change in government policy. 6. Internal control systems and theiradequacy. Internal control systems and procedures in the Company are commensurate with thesize and the nature of

Company's business and are regularly reviewed and updated by incorporating changes inregulatory provisions in order to safeguard the assets and to ensure reliability offinancial reporting. 7. Discussion on financial performance with respect to operationalperformance The gross block of assets of the company stood at Rupees 57.89 crores and networth of the company is Rupees (20.43) crores as at 31.03.2017. 8. Human Resources TheCompany continues to give priority to its human assets. The Company provides a fair andequitable work environment to all its employees. The Company is continuously working tocreate and nurture an atmosphere which is highly motivated and result oriented.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013 The Company has in place `Prevention of Sexual HarassmentPolicy`. This Anti-Sexual Harassment policy of the Company is in line with therequirements of The Sexual Harassment of Women at the Workplace (Prevention Prohibition& Redressal) Act 2013. All employees (permanent contractual temporary and trainees)are covered under this policy. An Internal Complaints Committee (ICC) is in place toredress complaints received regarding sexual harassment. The following is a summary ofsexual harassment complaints received and disposed off during the year - No. ofcomplaints received: Nil -No. of complaints disposed off: NA.

ACKNOWLEDGEMENT

Your Directors wish to express their grateful appreciation to the continuedco-operation received from the Banks Government Authorities Customers Vendors andShareholders during the year under review. Your Directors also wish to place on recordtheir deep sense of appreciation for the committed service of the Executives staff andWorkers of the Company.

By Order of the Board
For NUWAY ORGANIC NATURALS INDIA LIMITED
Sd/-
DATE: 08.08.2017 MANMINDER SINGH NARANG
PLACE: RAJPURA CHAIRMAN
DIN-00541751