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Orient Beverages Ltd.

BSE: 507690 Sector: Others
NSE: N.A. ISIN Code: INE247F01018
BSE 14:53 | 10 Aug 59.50 2.50
(4.39%)
OPEN

60.55

HIGH

60.55

LOW

58.15

NSE 05:30 | 01 Jan Orient Beverages Ltd
OPEN 60.55
PREVIOUS CLOSE 57.00
VOLUME 201
52-Week high 77.00
52-Week low 44.00
P/E 7.43
Mkt Cap.(Rs cr) 13
Buy Price 58.15
Buy Qty 5.00
Sell Price 59.40
Sell Qty 25.00
OPEN 60.55
CLOSE 57.00
VOLUME 201
52-Week high 77.00
52-Week low 44.00
P/E 7.43
Mkt Cap.(Rs cr) 13
Buy Price 58.15
Buy Qty 5.00
Sell Price 59.40
Sell Qty 25.00

Orient Beverages Ltd. (ORIENTBEVERAGES) - Director Report

Company director report

To The Shareholders

Your Directors have pleasure in presenting the Annual Report andAudited Accounts of your Company for the year ended 31st March 2019:

FINANCIAL RESULTS :

Particulars Standalone Consolidated
2018-19 2017-18 2018-19 2017-18
Profit / (Loss) before Depreciation & Taxation 41877 26032 46587 26032
Less : Depreciation and Amortization Expense 13898 13263 15642 13263
Tax Expenses
-Current Tax 6853 3200 7747 3209
-Deferred Tax Expenses/(Credit) (241) (763) (372) (771)
-Tax for Earlier years - (1503) (168) (1503)
6612 934 7207 935
Profit after Depreciation and Taxation 21367 11835 23738 11834
Other Comprehensive Income (Net of Tax) (947) (10) (947) (10)
Total Comprehensive Income for the year 20420 11825 22791 11824

DIVIDEND:

Your Directors have recommended a dividend @ 8% i.e. " 0.80 perequity share of " 10/- each for the financial year ended 31st March 2019 amountingto " 2084 thousand (Inclusive of dividend tax of " 355 thousand). The dividendpayout is subject to approval of the members at the ensuing Annual General Meeting.

TRANSFER TO RESERVE:

The Directors doesn't propose to transfer any amount to reserve duringthe year.

OPERATIONS AND STATE OF COMPANY'S AFFAIRS :

The Company's Revenue from operations have increased from "535439 thousand in the FY 2017-18 to " 692689 thousand in the FY 2018-19. Sale ofBeverages has increased from " 506380 thousand in the FY 2017-18 to " 643638thousand in the FY 2018-19 showing an increase of 27.10%. Total Comprehensive Income ofthe Company has also increased from " 11825 thousand in the FY 2017-18 to "20420 thousand in the FY 2018-19. During the year the Company has received a sum of" 18426 thousand as arrear rent pursuant to settlement of a long pending disputewith a tenant. Continuous increase in the cost of material and manpower withoutcorresponding increase in the sale price of our products affects our performanceconsiderably since sale price is fixed by our principal M/s Bisleri International Pvt.Ltd.

Leasehold rights of the Company in a property situated at 225C A. J.C. Bose Road Kolkata has expired on 11th May 2019. Negotiations for renewal of the leasebetween the landlord and the Company are going on. The Directors are hopeful for a betteryear ahead in the current year subject to the stable market conditions.

SUBSIDIARY COMPANIES:

Sharad Quench Pvt. Ltd. (SQPL): SQPL a wholly owned subsidiary of theCompany is engaged in the construction of a "Packaged Drinking Water" projectat Sankrail Howrah W.B. and the same is expected to start commercial production shortly.Financial Statements of SQPL for the F.Y. 2018-19 has been duly considered in theConsolidated Financial Statements presented in this Annual Report of the Company.

Satyanarayan Rice Mill Pvt. Ltd. (SRMPL): The Company has acquired 100percent Equity Shares of SRMPL on 3rd April 2018 as a result the said SRMPL has becomewholly owned subsidiary of Orient Beverages Ltd. SRMPL is engaged in the business ofpackaged drinking water and has Plant at P.O. Pandua Dist. Hooghly W.B. FinancialStatements of SRMPL for the F.Y. 2018-19 has been duly considered in the ConsolidatedFinancial Statements presented in this Annual Report of the Company.

It is expected that there should be a sizeable increase in the Groupturnover and income with the working of said subsidiary companies in the coming time.Salient features of the financial statements of said subsidiary companies have beenattached along with the Annual Report in the Form AOC-1.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management discussion and analysis report for the year under review asstipulated under Regulation 34(2)(e) of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 is attached with thisReport and marked as Annexure - I.

EXTRACT OF ANNUAL RETURN:

Pursuant to Section 92(3) of the Companies Act 2013 read with Rule12(1) of the Companies (Management and Administration) Rules 2014 an extract of theAnnual Return for the year ended 31st March 2019 in the prescribed Form MGT- 9 isattached with this Report and marked as Annexure - II.

DIRECTORS:

Sri Narendra Kumar Poddar Chairman (DIN: 00304291) retires by rotationat the ensuing Annual General Meeting and being eligible offers himself forre-appointment. An appropriate resolution for his appointment is being placed forconsideration of the members at the ensuing Annual General Meeting.

The present term of Dr. Gora Ghose as Independent Director expires on31st March 2019. Your Directors propose his appointment for second term as mentioned inthe relevant Resolutions with effect from 1st April 2019 for a period of 5(five)consecutive years.

Sri Anil Kumar Poddar Independent Director has resigned from the Boardof Directors of the Company with effect from 27th September 2018. The Board of Directorshas placed on record its sincere appreciation and gratitude for the valuable contributionmade by Sri A. K. Poddar during his association with the Company as a Director.

None of the Directors is disqualified for appointment/re-appointmentunder Section 164 of 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) and Sri Vivek Vardhan Agarwalla (DIN: 00674395) that they meet the criteria ofIndependence as prescribed under Section 149(6) of the Companies Act 2013.

FORMAL ANNUAL EVALUATION:

The Nomination and Remuneration Committee of the Board has devisedcriteria for evaluation of the performance of Directors. The Board has evaluated its ownperformances and that of its Committees and all individual directors i.e. both Independentand Non-Independent. All the Directors of the Company are found to be persons of havingknowledge and experience in their respective area and their association with the Companyis considered 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 Policyin consultation with its Nomination and Remuneration Committee for determiningqualifications positive attributes and independence of directors and criteria fordirectors' appointment and remuneration.

The main features of the Policy are as follows:

The Company while constituting the Board shall drawmembers from diverse fields such as finance law administration management marketingmanufacturing operations or other disciplines related to the Company's business. Thereshall be no discrimination on the basis of gender while determining the Boardcomposition.

A Director shall be a person of integrity who possessesrelevant expertise and experience. He/she shall uphold ethical standards of integrity andprobity and act objectively and constructively. He/she shall exercise his/herresponsibilities in a bona-fide manner in the interest of the Company. Devote sufficienttime and attention to his/her professional obligations for informed and balanced decisionmaking. Assist the Company in implementing the best corporate governance practices.

The objective of the policy is to have a compensationframework that will reward and retain talent.

The remuneration will be such as to ensure that thecorrelation of remuneration to performance is clear and meets appropriate performancebenchmarks.

KEY MANAGERIAL PERSONNEL:

Pursuant to Section 203 of the Companies Act 2013 following officialsare the Key Managerial 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 Chief Financial 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 of such meetings were 3rd April 2018 30th May 2018 27th July 2018 14thAugust 2018 27th September 2018 14th November 2018 2nd January 2019 13th February2019 and 12th March 2019.

Pursuant to the requirements of Schedule IV to the Companies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 aseparate Meeting of the Independent Directors of the Company was also held on 24thDecember 2018 without the presence of non-independent directors and members of themanagement to review the performance of non-independent directors and the Board as awhole the performance of the Chairperson of the Company and also to assess the qualityquantity and timeliness of flow of information between the Company management and theBoard.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of Section 134(5) the Companies Act 2013the Directors hereby confirm and state that:

i. In the preparation of annual accounts for the financial year ended31st March 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures

ii. They have selected such accounting policies and applied themconsistently and made judgement 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 of the Company for that period;

iii. They have taken proper and sufficient care for the maintenance ofadequate accounting 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 bythe Company and that such internal financial controls are adequate and are operatingeffectively and vi. They have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.

AUDITORS:

M/s D. Mitra & Co. Chartered Accountants (ICAI Firm Regn. No.328904E) were appointed as Statutory Auditors of the Company for a period of 5(five)years with effect from financial year 2017-18 who shall hold office from the conclusionof the 56th Annual General Meeting till the conclusion of the 61st Annual General Meetingof the Company. M/s D. Mitra & Co. Chartered Accountants have confirmed theirwillingness and eligibility in terms of the provisions of Section 141 of the CompaniesAct 2013 the Chartered Accountants Act 1949 and rules or regulations made there underto continue as Auditors of the Company.

Further the Ministry of Corporate Affairs (MCA) vide notification dated7th May 2018 has done away with the requirement of ratification of appointment ofStatutory Auditors at every Annual General Meeting as per the first proviso of Section139 of the Companies Act 2013 and the Companies (Audit and Auditors) Amendment Rules2018. Accordingly the Company is not required to pass any resolution pertaining toratification of the appointment of Statutory Auditors in the ensuing Annual GeneralMeeting.

AUDITORS' REPORTS:

The Independent Auditors' Reports for the financial year ended 31stMarch 2019 does not contain any qualification reservation or adverse remark.

SECRETARIAL AUDIT:

Pursuant to Section 204 of the Companies Act 2013 read with Rule 9 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany had appointed M/s Manoj Shaw & Co. Practising Company Secretaries asSecretarial Auditor for conducting the Secretarial Audit of the Company for the financialyear 2018-19. The Secretarial Auditors' Report received from said Auditors forms part ofthis Report and marked as Annexure - III. There are no qualifications or adverse remarksin their Report.

COST AUDIT:

Pursuant to the provisions of Section 148 of the Companies Act 2013read with the Companies (Cost records and audit) Rules 2014 Cost Audit is not applicableto the Company.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

Particulars of loans given by the Company have been disclosed in theNotes to the Financial Statements for the year under review. The Company has not given anyguarantee or provided security in connection with a loan taken by any other person.Particulars of investments made by the Company have been disclosed in the Notes toFinancial Statements for the year under review.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All the transactions with related parties entered during the year underreview were in the ordinary course of business and on the arm's length basis and the samehas been duly approved by the Audit Committee. However there was no material contract orarrangement or transaction other than arm's length basis entered with a related partyduring the year under review. Hence disclosure in Form AOC- 2 is not required.

INFORMATION PURSUANT TO SECTION 134(3)(m) OF THE COMPANIES ACT 2013READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES 2014:

(A) Conservation of energy:

i. Steps taken or impact on conservation of energy:

Installation of Automatic Pet Blow Moulding Machines forblowing plant to save time and power.

Installation of High Pressure Air Compressor for blowingplant to upgrade the output system.

• Installation of New Ganerator of higher capacity to ensureuninterrupted supply of power to the plant. ii. The steps taken by the Company forutilising alternate sources of energy:

The Company is making maximum use of natural lightingduring day time by using transparent roof sheets. iii. The capital investment on energyconservation equipments:

A sum of " 10618 thousand was spent towardsacquisition of energy conservation equipments during the year under review.

(B) Technology Absorption:

i. The efforts made towards technology absorption:

Technology absorption is a continuous process. TheCompany keeps track of new machines and upgrade its plant and machinery with the latestavailable technology.

ii. The benefits derived like product improvement cost reductionproduct development or import substitution:

Improved productivity and consequent reduction in thecost of production.

iii. In case of imported technology (imported during the last threeyears reckoned from the beginning of the financial year)

Details of technology imported Year of import Whether the technology been fully absorbed If not fully absorbed areas where absorption has not taken place and the reasons thereof
Not Applicable

iv. The expenditure incurred on research and development:

Being Franchisee of M/s Bisleri International PrivateLimited the Company is adopting technological guidelines provided by its Principal fromtime to time and thus research and development of technology is automatically taken careof. Hence there is no expenditure 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 yearunder review. The foreign exchange outgo was " 3470 thousand on account oftravelling and other expenses.

DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY:

The Board has developed and implemented a risk management policy of theCompany identifying therein the elements of risk and concern that may threaten theexistence of the Company which entail the recording monitoring and controlling ofCompany's risks and addressing them comprehensively and empirically.

The Risk Management system aims to:

i. Address our Company's strategies operations and compliances andprovide a unified and comprehensive perspective;

ii. Establish the risk appetite;

iii. Be simplistic and intuitive to facilitate a speedy and appropriateidentification of potential and actual risks and its communication;

iv. Seek escalation of the identified risk events to the appropriatepersons to enable a timely and satisfactory risk response; v. Reduce surprises and lossesforesee opportunities and improve deployment of resources; and vi. Develop a mechanism tomanage risks.

CORPORATE SOCIAL RESPONSIBILTY:

Provisions of Section 135 of the Companies Act 2013 are not applicableto the Company. Hence disclosure as per Annexure given in the Companies (Corporate SocialResponsibility Policy) Rules 2014 has not been made here.

LISTING OF SHARES AND LISTING FEE:

The equity shares of the Company are listed on The Calcutta StockExchange Ltd. and BSE Limited. The listing fee for the year 2019-20 has already been paidto the both Stock Exchanges.

CORPORATE GOVERNANCE REPORT:

The provisions of Regulation 15(2) read with Regulation 27 of theSecurities and Exchange Board of India (Listing

Obligations and Disclosure Requirements) Regulations 2015 are notapplicable to the Company. Hence report on Corporate Governance for the financial year2018-19 is not attached herewith.

DEPOSITS:

The Company has not accepted any deposits from the public under Section73 of the Companies Act 2013 read with the Companies (Acceptance of deposit) Rules 2014.

AUDIT COMMITTEE:

Audit Committee was reconstituted on 27th September 2018. The presentcomposition of the Audit Committee of the Company is as under:

Sl. No. Name of the Director Category of the Director Designation
i. Sri Vivek Vardhan Agarwalla Independent Director Chairman
ii. Dr. Gora Ghose Independent Director Member
iii. Sri Ballabha Das Mundhra Executive Director Member

The Company Secretary acts as Secretary of the Committee. There is nosuch recommendation of the Audit Committee which has not been accepted by the Boardduring the year under review.

ESTABLISHMENT OF VIGIL MECHANISM:

The Company has established a vigil mechanism/ whistle blower policy.The policy allows intimation by any director or employee or any other stakeholder to thedesignated officer in good faith of misconduct or unethical or improper activity through awritten communication. Audit Committee oversees the vigil mechanism for disposal of thecomplaint. Direct access to the chairman of the Audit Committee is also allowed inexceptional cases. The vigil mechanism/ whistle blower policy is available on Company'swebsite www.obl.org.in.

PARTICULARS OF EMPLOYEES:

Particulars of employees pursuant to Section 197(12) of the CompaniesAct 2013 read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are attached herewith and marked as Annexure -IV.

INTERNAL FINANCIAL CONTROL SYSTEMS:

The Company has adopted guidelines for ensuring orderly and efficientInternal Financial Controls as required under the provisions of the Companies Act 2013.The Audit Committee after considering the views of Statutory Auditors and InternalAuditors has found that such Internal Financial Controls commensurate with the size andoperations of the Company are adequate and operating efficiently. The Audit Committee inconsultation with the Internal Auditors formulates the scope function and methodologyfor conducting the internal audit. The Internal Financial Controls system is satisfactoryas per evaluation of the Audit Committee.

DISCLOSURES:

Following disclosures are made under the Companies (Accounts) Rules2014:

(i) The financial summary or highlights are discussed at the beginningof this report; (ii) There is no change in the nature of business;

(iii) There is no significant and material order was passed by theregulators or courts or tribunals impacting the going concern status and the Company'soperations in future.

APPRECIATION:

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 2019 Chairman