To The Shareholders
Your Directors have pleasure in presenting the Annual Report and Audited Accounts ofyour Company for the year ended 31st March 2017:
FINANCIAL RESULTS : (Amount in )
| ||2016-17 ||2015-16 |
|Profit / (Loss) before Depreciation & Taxation ||24113640 ||26036933 |
|Less: Depreciation and Amortization Expense ||12835434 ||11155506 |
|Tax Expenses || || |
|-Current Tax ||1332000 ||4576000 |
|-Deferred Tax ||6727224 ||(6419803) |
|-Tax for Earlier years ||428330 ||371277 |
| ||2790652 ||16353953 |
|Add : Brought Forward Profit ||107105415 ||93832686 |
|Profit available for appropriation ||109896067 ||110186639 |
|Appropriations: || || |
|Proposed Dividend ||1729200 ||1729200 |
|Tax on Dividend ||352024 ||352024 |
|Transfer to General Reserve ||- ||1000000 |
|Balance carried to Balance Sheet ||107814843 ||107105415 |
| ||109896067 ||110186639 |
Your Directors have recommended a dividend @ 8 % i.e. 0.80 per equity share of 10/-each for the financial year ended 31st March 2017 amounting to 2081224/- (Inclusive oftax of 352024/-). The dividend payout is subject to approval of the members at theensuing Annual General Meeting.
TRANSFER TO RESERVE:
The Directors doesn't propose to transfer any amount to reserve during the year.
OPERATIONS AND STATE OF COMPANY'S AFFAIRS:
The Company's Revenue from operations has increased from 3542.82 lakh in FY 2015-16 to4221.21 lakh in FY 2016-17. Sale of Beverages has increased from 3334.69 lakh in FY2015-16 to 4065.26 lakh in FY 2016-17 showing an increase of 22%. Profit after tax forthe FY 2016-17 is lower at 27.91 lakh against 163.54 lakh in FY 2015-16 mainly due todeferred tax credit available in the previous financial year. During the year underreview corresponding increase in the profit with the increase in sales could not beachieved due to increase in the cost of production finance and manpower withoutcorresponding increase in the sale price of our products since the sale price is beingfixed by our principal M/s Bisleri International Pvt. Ltd. Decrease in the rental incomeof the Company pursuant to expiry of leasehold rights in a property in the previous yearis also a reason for lower profit for the year under review.
M/s Bisleri International Pvt. Ltd. has launched some new soft drink products namely(I) SPYCI (II) FONZO (III) LIMONATA and (IV) PINACOLADA and the Company as franchisee ofM/s Bisleri International Pvt. Ltd. has commenced commercial production of said softdrinks at its new plant at Sankrail Howrah West Bengal with effect from 24th February2016. However these new products are still at the stage of grabbing the market betterresults are expected for the new products in the current year.
Renewal of tenancy of one tenant namely M/s Income Tax Appellate Tribunal is due since01.09.2012 but M/s Income Tax Appellate Tribunal has not agreed to increase the rentacceptable to the Company based on prevailing market rate. The Company has filed aneviction suit in the Civil Court to recover possession of the property and collection ofarrear rent/ damages. The Company expects a good increase in its rental income uponsettlement of the case. With the present Real Estate activities the Directors hope for abetter year ahead in the current year subject to stable market conditions.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management discussion and analysis report for the year under review as stipulatedunder Regulation 34(2)(e) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 is attached with this Reportand marked as Annexure - I.
EXTRACT OF ANNUAL RETURN:
Pursuant to Section 92(3) of the Companies Act 2013 read with Rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of the Annual Return forthe year ended 31st March 2017 in the prescribed Form MGT- 9 is attached with this Reportand marked as Annexure - II.
Sri Ballabha Das Mundhra (DIN: 01162223) Executive Director retires by rotation atthe ensuing Annual General Meeting and being eligible offers himself for re-appointment.An appropriate resolution for his appointment is being placed for consideration of themembers at the ensuing Annual General Meeting.
None of the Directors is disqualified for appointment/re-appointment under Section 164of the Companies Act 2013.
DECLARATION UNDER SECTION 149(7) OF THE COMPANIES ACT 2013:
The Company has received declarations from Dr. Gora Ghose (DIN: 00217079) Sri AnilKumar Poddar (DIN: 00304837) and Sri Vivek Vardhan Agarwalla (DIN: 00674395) that theymeet the criteria of Independence as prescribed under Section 149(6) of the Companies Act2013.
FORMAL ANNUAL EVALUATION:
The Nomination and Remuneration Committee of the Board has devised criteria forevaluation of the performance of Directors. The Board has evaluated its own performancesand that of its Committees and all individual directors i.e. both Independent and NonIndependent. All the Directors of the Company are found to be persons of having knowledgeand experience in their respective area and their association with the Company isconsidered to be beneficial to the Company.
COMPANY'S POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS:
The Board of Directors of the Company has adopted a Remuneration Policy in consultationwith its Nomination and Remuneration Committee for determining qualifications positiveattributes and independence of directors and criteria for directors' appointment andremuneration.
The main features of the Policy are as follows:
The Company while constituting the Board shall draw members from diverse fieldssuch as finance law administration management marketing manufacturing corporategovernance operations or other disciplines related to the Company's business. There shallbe no discrimination on the basis of gender while determining the Board composition.
A Director shall be a person of integrity who possesses relevant expertise andexperience. He/she shall uphold ethical standards of integrity and probity and actobjectively and constructively. He/she shall exercise his/her responsibilities in abona-fide manner in the interest of the Company. Devote sufficient time and attention tohis/her professional obligations for informed and balanced decision making. Assist theCompany in implementing the best corporate governance practices.
The objective of the policy is to have a compensation framework that will rewardand retain talent.
The remuneration will be such as to ensure that the correlation of remunerationto performance is clear and meets appropriate performance benchmarks.
KEY MANAGERIAL PERSONNEL:
Pursuant to Section 203 of the Companies Act 2013 following officials are the KeyManagerial Personnel of the Company:
i. Sri Narendra Kumar Poddar Chairman; ii. Sri Akshat Poddar Managing Director; iii.Sri Ballabha Das Mundhra Executive Director; iv. Sri Arun Kumar Singhania ChiefFinancial Officer and v. Sri Jiyut Prasad Company Secretary.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS:
The Board of Directors met 9(Nine) times during the year under review. The dates ofsuch meetings were 30th May 2016 2nd August 2016 12th August 2016 14th September2016 28th September 2016 12th November 2016 8th December 2016 13th February 2017and 16th March 2017.
Pursuant to the requirements of Schedule IV to the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 a separate Meeting ofthe Independent Directors of the Company was also held on 27th December 2016 without thepresence of non-independent directors and members of the management to review theperformance of non-independent directors and the Board as a whole the performance of theChairperson of the Company and also to assess the quality quantity and timeliness of flowof information between the Company management and the Board.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 134(5) the Companies Act 2013 the Directorshereby confirm and state that:
i. In the preparation of annual accounts for the financial year ended 31st March 2017the applicable accounting standards have been followed along with proper explanationrelating to material departures
ii. They have selected such accounting policies and applied them consistently and madejudgement and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitof the Company for that period;
iii. They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv. They have prepared the annual accounts on a going concern basis;
v. They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively and vi.They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
M/s D. Mitra & Co. Chartered Accountants (ICAI Firm Regn. No. 328904E) wereappointed as Statutory Auditors of the Company for a period of 5(five) years w.e.f.financial year 2017-18 who shall hold office from the conclusion of this 56th AnnualGeneral Meeting till the conclusion of the 61st Annual General Meeting of the Companysubject to ratification by shareholders at every Annual General Meeting in place ofexisting auditors M/s Tiwari & Co. Chartered Accountants retiring at the conclusionof the 56th Annual General Meeting upon completion of their term. M/s. D. Mitra &Co. Chartered Accountants have confirmed their willingness and eligibility in terms ofthe provisions of Section 141 of the Companies Act 2013; the Chartered Accountants Act1949 and the rules or regulations made there under to be appointed as Auditors of theCompany.
The Independent Auditors' Report for the financial year ended 31st March 2017 does notcontain any qualification reservation or adverse remark.
Pursuant to Section 204 of the Companies Act 2013 read with Rule 9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hadappointed Sri Manoj Prasad Shaw of M/s Manoj Shaw & Co. Practising CompanySecretaries as Secretarial Auditor for conducting the Secretarial Audit of the Companyfor the financial year 2016-17. The Secretarial Auditors' Report received from saidAuditors forms part of this Report and marked as Annexure - III. There are noqualifications or adverse remarks in their Report.
Pursuant to the provisions of Section 148 of the Companies Act 2013 read with theCompanies (Cost records and audit) Rules 2014 Cost Audit is not applicable to theCompany.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
Particulars of loans given by the Company have been disclosed in the Note No.2.11(B)(i) and 2.11(B)(ii) to the Financial Statements for the year under review. TheCompany has not given any guarantee or provided security in connection with a loan takenby any other person. Particulars of Investments made by the Company have been disclosed inthe Note No. 2.9 to the Financial Statements for the year under review.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
All the transactions with related parties entered during the year under review were inthe ordinary course of business and on the arm's length basis and the same has been dulyapproved by the Audit Committee. However there was no material contract or arrangement ortransaction other than arm's length basis entered with a related party during the yearunder review. Hence disclosure in Form AOC- 2 is not required.
INFORMATION PURSUANT TO SECTION 134(3)(m) OF THE COMPANIES ACT 2013 READ WITH RULE 8OF THE COMPANIES (ACCOUNTS) RULES 2014: (A) Conservation of energy: i. Steps taken orimpact on conservation of energy:
Installation of Auto Blow Moulding Machines for blowing plant to save time andpower.
Lighting system in the factory has been upgraded to use LED lights and therebysaving in the cost of energy. ii. The steps taken by the Company for utilising alternatesources of energy:
The Company is making maximum use of natural lighting during day time by usingtransparent roof sheets. iii. The capital investment on energy conservation equipments:
A sum of 1683557/- was spent towards acquisition of energy conservationequipments during the year under review.
(B) Technology Absorption: i. The efforts made towards technology absorption:
Technology absorption is a continuous process. The Company keeps track of newmachines and upgrade its plant and machinery with the latest available technology.
ii. The benefits derived like product improvement cost reduction product developmentor import substitution:
Improved productivity and automation processes. iii. In case of importedtechnology (imported during the last three years reckoned from the beginning of thefinancial year)
|Details of technology ||Year of ||Whether the technology ||If not fully absorbed areas where absorption has |
|imported ||import ||been fully absorbed ||not taken place and the reasons thereof |
| || || |
iv. The expenditure incurred on research and development:
Being Franchisee of M/s Bisleri International Private Limited the Company isadopting technological guidelines provided by its Principal from time to time and thusresearch and development of technology is automatically taken care of. Hence there is noexpenditure incurred on research and development during the year.
(C) Foreign exchange earnings and outgo:
Your Company did not have any foreign exchange earnings during the year under review.The foreign exchange outgo was 3220484/- on account of travelling and other expenses.
DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:
The Board has developed and implemented a risk management policy of the Companyidentifying therein the elements of risk and concern that may threaten the existence ofthe Company which entail the recording monitoring and controlling of Company's risks andaddressing them comprehensively and empirically.
The Risk Management system aims to: i. Address our Company's strategies operations andcompliances and provide a unified and comprehensive perspective; ii. Establish the riskappetite; iii. Be simplistic and intuitive to facilitate a speedy and appropriateidentification of potential and actual risks and its communication; iv. Seek escalation ofthe identified risk events to the appropriate persons to enable a timely and satisfactoryrisk response; v. Reduce surprises and losses foresee opportunities and improvedeployment of resources; and vi. Develop a mechanism to manage risks.
CORPORATE SOCIAL RESPONSIBILTY:
Provisions of Section 135 of the Companies Act 2013 are not applicable to the Company.Hence disclosure as per Annexure given in the Companies (Corporate Social ResponsibilityPolicy) Rules 2014 has not been made here.
LISTING OF SHARES AND LISTING FEE:
The equity shares of the Company are listed on The Calcutta Stock Exchange Ltd. and BSELimited. The listing fee for the year 2017-18 has already been paid to the both StockExchanges.
CORPORATE GOVERNANCE REPORT:
The provisions of Regulation 15(2) read with Regulation 27 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 are not applicable to the Company. Hence report on Corporate Governance for thefinancial year 2016-17 is not attached herewith.
The Company has not accepted any deposits from the public under Section 73 of theCompanies Act 2013 read with the Companies (Acceptance of deposit) Rules 2014.
The present composition of the Audit Committee of the Company is as under:
|Sl. No. ||Name of the Director ||Category of the Director ||Designation |
|i. ||Sri Anil Kumar Poddar ||Independent Director ||Chairman |
|ii. ||Dr. Gora Ghose ||Independent Director ||Member |
|iii. ||Sri Ballabha Das Mundhra ||Executive Director ||Member |
|iv. ||Sri Vivek Vardhan Agarwalla ||Independent Director ||Member |
The Company Secretary acts as Secretary of the Committee. There is no suchrecommendation of the Audit Committee which has not been accepted by the Board during theyear under review.
ESTABLISHMENT OF VIGIL MECHANISM:
The Company has established a vigil mechanism/ whistle blower policy. The policy allowsintimation by any director or employee or any other stakeholder to the designated officerin good faith of misconduct or unethical or improper activity through a writtencommunication. Audit Committee oversees the vigil mechanism for disposal of the complaint.Direct access to the chairman of the Audit Committee is also allowed in exceptional cases.The vigil mechanism/ whistle blower policy is available on Company's website www.obl.org.in.
PARTICULARS OF EMPLOYEES:
Particulars of employees pursuant to Section 197(12) of the Companies Act 2013 readwith Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 are attached herewith and marked as
Annexure - IV.
INTERNAL FINANCIAL CONTROL SYSTEMS:
The Company has adopted guidelines for ensuring orderly and efficient InternalFinancial Controls as required under the provisions of the Companies Act 2013. The AuditCommittee after considering the views of Statutory Auditors and Internal Auditors hasfound that such Internal Financial Controls commensurate with the size and operations ofthe Company are adequate and operating efficiently. The Audit Committee in consultationwith the Internal Auditors formulates the scope function and methodology for conductingthe internal audit. The Internal Financial Controls system is satisfactory as perevaluation of the Audit Committee.
Following disclosures are made under the Companies (Accounts) Rules 2014: (i) Thefinancial summary or highlights are discussed at the beginning of this report; (ii) Thereis no change in the nature of business;
(iii) The Company has promoted a wholly owned subsidiary namely M/s Sharad QuenchPrivate Limited on 29th March 2017 to construct and operate a packaged drinking waterproject. However the Company do not have any joint venture or associate Company duringthe year.
(iv) There is no significant and material order was passed by the regulators or courtsor tribunals impacting the going concern status and the Company's operations in future.
Your Directors wish to express their grateful appreciation for the co-operation andsupport received from customers vendors shareholders financial institutions banksregulatory authorities and the society at large. Deep appreciation is also recorded forthe dedicated efforts and contribution of the employees at all levels as without theirfocus commitment and hard work the Company's consistent growth would not have beenpossible despite the challenging environment.
For and behalf of the Board N. K. Poddar
Kolkata 30th May 2017