Your Company's Directors are pleased to present the 44th Annual Report of the Companytogether with the Statement of Audited Accounts for the financial year ended 31st March2017.
| || ||(Rs. in crores) |
|Particulars ||Year ended 31.03.2017 ||Year ended 31.03.2016 |
|Revenue from Operations ||329.99 ||290.17 |
|Operating Expenses ||312.09 ||292.02 |
|Operating Profit/(Loss) before Interest Tax Depreciation & Amortization ||17.90 ||(1.85) |
|Depreciation & Amortization Expense ||7.78 ||8.19 |
|Finance Costs ||13.51 ||11.31 |
|Other Income ||3.64 ||2.63 |
|Profit/(Loss) before Exceptional & Extraordinary Items and Tax ||0.25 ||(18.72) |
|Exceptional & Extraordinary Items ||- ||- |
|Profit/(Loss) before Tax ||0.25 ||(18.72) |
|Tax Expense (including Deferred Tax) ||(0.07) ||(6.09) |
|Tax for Earlier Years ||0.03 ||(0.04) |
|Profit/(Loss) after Tax ||0.29 ||(12.59) |
|Balance brought forward from the previous year ||20.21 ||32.80 |
|Balance carried to Balance Sheet ||20.50 ||20.21 |
TRANSFER TO RESERVES
In view of inadequacy of profits for the financial year under review no amount hasbeen transferred to the Reserve.
STATE OF COMPANY AFFAIRS/REVIEW OF OPERATIONS
The sales and other income of the Company increased to Rs.333.63 crores for the yearunder review. The Company reported a Profit after Tax of Rs.0.29 crores as compared to theloss of Rs.12.59 crores in the previous year. Though the business environment continuesto be challenging considering the circumstances the performance of your Company wassatisfactory during the year.
There were no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year to which this financialstatements relate and the date of this Report.
The Directors do not recommend any dividend for the year ended 31st March 2017.
The paid-up Equity Share Capital of your Company as on March 31 2017 was Rs.19.08crores. The Company has not issued shares with differential voting rights/Bonus Shares norhas granted stock options/sweat equity and has not bought back any of its securitiesduring the year under review.
The Company has not accepted or renewed any deposits during the year. There are nooutstanding deposits as at 31st March 2017.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act 2013 the Directors confirm that:
a) in preparation of the annual accounts for the year ended March 31 2017 theapplicable accounting standards have been followed along with proper explanation relatingto material departures if any;
b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as at March 31 2017 and of the profit of theCompany for the year ended on that date;
c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a 'going concern' basis;
e) 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
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Company has implemented procedures and adopted practices in conformity with theCode of Corporate Governance under the SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015. The Company has implemented Code of Conduct for all itsExecutive Directors and Senior Management Personnel Non-Executives Non-Independent andIndependent Directors who have affirmed compliance thereto. The said Code of Conduct hasbeen posted on the website of the Company.
The Corporate Governance Report and the Management Discussion & Analysis Reportappearing elsewhere in this Annual Report forms part of Directors Report. A certificatefrom the Statutory Auditors of the Company certifying the compliance of conditions ofCorporate Governance is also annexed thereto.
CORPORATE SOCIAL RESPONSIBILITY
The provisions as prescribed under Section 135 of the Companies Act 2013 with regardto corporate social responsibility along with Rules made thereunder are not applicable tothe Company. The Corporate Social Responsibility Policy and the Committee shall be framedand constituted as and when required.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Your Company has not directly or indirectly:
a) given any loan to any person or other body corporate other than usual advancesenvisaged in a contract of supply of materials if any
b) given any guarantee or provide security in connection with a loan to any other bodycorporate or person; and
c) acquired by way of subscription purchase or otherwise the securities of any otherbody corporate exceeding sixty percent of its paid-up share capital free reserve andsecurities premium account or one hundred percent of its free reserves and securitiespremium account whichever is more.
RELATED PARTY TRANSACTIONS
There were no related party transactions entered into during the financial year underSection 188 of Companies Act 2013. The Policy on Related Party Transactions as approvedby the Board is uploaded on the Company's web-site.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Change in Directors
Mr. Hanish Malhotra Director (Marketing) and Mr. Mohanraj M. Singhi IndependentDirector have resigned from the Board of Directors with effect from 17th May 2017 and8th July 2017 respectively.
The Board records its appreciation for the valuable services rendered by both theDirectors.
In accordance with the applicable provisions of the Companies Act 2013 and Rules madethereunder Ms. Suchita Shah retires by rotation at the forthcoming Annual General Meetingand being eligible offer herself for re-appointment. The Board recommends herre-appointment.
The Board has re-appointed Mr. Pradeep Sharma as Director (Operations) of the Companyw.e.f. 26th October 2017 for a period of 3 years. The Board recommends hisre-appointment.
Key Management Personnel
Pursuant to the provisions of Section 203 of the Companies Act 2013 the KeyManagement Personnel of the Company are - Mr. Ashok Malhotra Chairman & ManagingDirector Mr. Pradip H. Gupta Chief Financial Officer and Mr. Deepak Nagar GM (Legal)& Company Secretary.
Declaration by Independent Directors
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16(1)(b) of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.
In accordance with the provisions of Section 152(6)(e) of the Companies Act 2013 noneof the Independent Directors are liable to retire by rotation.
Pursuant to the provisions of the Companies Act 2013 and Regulation 17(10) of the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 the Board hascarried out an annual performance evaluation of its own performance the Directorsindividually as well as of the Audit Nomination & Remuneration & StakeholdersRelationship Committees of the Board. The details of Board evaluation process have beenprovided under the Corporate Governance Report.
Familiarization Programme for Independent Directors
In compliance with the requirements of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015 the Company has put in place a familiarization programmefor Independent Directors to familiarize them with their role rights and responsibilitiesas Directors the operations of Company business overview etc. The details offamiliarization programme are explained in the Corporate Governance Report.
The Board on the recommendation of the Nomination and Remuneration Committee had frameda policy for selection and appointment of Directors Senior Management and theirremuneration. The details of the Remuneration Policy forms part of Corporate GovernanceReport of this Annual Report.
Number of Meetings of the Board of Directors and Audit Committee
During the year 4 (four) Board Meetings 1 (one) Independent Directors' Meeting and 4(four) Audit Committee Meetings were convened and held the details of which are given inthe Corporate Governance Report. The intervening gap between the meetings was within theperiod prescribed under the Companies Act 2013 and Regulation 17(2) of the SEBI (ListingObligations & Disclosure Requirements) Regulations 2015.
AUDITORS AND AUDITORS' REPORT
M/s. JRS Patel & Co. Chartered Accountants the existing Statutory Auditors of theCompany were re-appointed at the 41st Annual General Meeting (AGM) held on 30th September2014 to hold office till the conclusion of forthcoming 44th AGM for a period of 3 years.Accordingly they will retire at this AGM.
In accordance with the provision of Section 139 and other applicable provisions ifany of the Companies Act 2013 and the relevant Rules framed thereunder the Board ofDirectors have proposed to appoint M/s Atul Parikh & Co. Chartered AccountantsVadodara as Statutory Auditors of the Company for a term of 5 consecutive years at theensuing 44th AGM till the conclusion of 49th AGM in place of retiring Auditors M/s. JRSPatel & Co. Chartered Accountants. They have furnished their consent and requisitecertificate pursuant to the Act in respect of their proposed appointment.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report and hence do not call for any commentsunder Section 134(3)(f) of the Companies Act 2013.
Your Company has appointed M/s. Saurabh Shah & Co. Chartered Accountants Vadodaraas Internal Auditors to carry out the Internal Audit of various operational areas of theCompany.
M/s. Kiran J. Mehta & Co. Cost Accountants Ahmedabad the Cost Auditors of theCompany carried out the audit of cost records for steel Plant of the Company during theyear. The Board of Directors have appointed M/s. Kiran J. Mehta & Co. CostAccountants for the financial year 2017-18. The Cost Audit Report for the Financial Year2015-16 was filed with the Ministry of Corporate Affairs on 24th August 2016.
In terms of the provisions of Section 204 of the Companies Act 2013 Mr. NirajTrivedi Practising Company Secretary Vadodara has been re-appointed by the Board asSecretarial Auditor of the Company for the financial year 2017-18. The Secretarial AuditReport as issued by the Secretarial Auditor in Form No. MR-3 for the financial year2016-17 is annexed herewith as "Annexure - A" and forms integral part of thisAnnual Report. The Secretarial Audit Report does not containany qualification reservationor adverse remark.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return required under Section 134(3)(a) and 92(3) of theCompanies Act 2013 read with Rule 12(1) of the Companies (Management and Administration)Rules 2014 forms part of this report as "Annexure - B".
During the year the Board has accepted all recommendations of Audit Committee andaccordingly no disclosure is required to be made in respect of non-acceptance of therecommendation of the Audit Committee by the Board.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism named Whistle Blower Policy to deal with instances offraud and mismanagement if any. The details of the Whistle Blower Policy is explained inthe Corporate Governance Report and also posted on the website of the Company.
RISK MANAGEMENT POLICY
The Company has a Risk Management Policy to ensure appropriate risk management withinits systems and culture. The Board of Directors and the Audit Committee of the Companyperiodically reviews the Risk Management Policy of the Company. The provisions relating toRisk Management Committee are not applicable to the Company.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. These systems are routinely tested by Statutory as well asInternal Auditors. Significant audit observations if any and follow up actions thereonare reported to the Audit Committee.
The Company has in place adequate internal financial controls with reference tofinancial statements.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHNAGE EARNINGS &OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 is annexed herewith as "Annexure -C" to this Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Rule 5(1) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is attached as "Annexure - D" to thisReport.
The statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out under Section 197(12) of the Act read withRules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is annexed as "Annexure - E" to this Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators /Courts which wouldimpact the going concern status of the Company and its future operations.
SUBSIDIARY JOINT VENTURES OR ASSOCIATE COMPANY
Honeyvick Enterprises Private Limited is a holding company of your Company holding55.12% Equity Share Capital of the Company. Neither the Company has any subsidiary/associate/ joint venture Company nor any other Company has become subsidiary/ associate/joint venture company of the Company during the year.
DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framedthereunder.
During the financial year 2016-17 the Company has not received any complaints onsexual harassment and hence no complaints remain pending as of 31 March 2017.
Your Directors thank the Banks Financial Institutions Shareholders Customers andSuppliers for their co-operation and support to the Company. The Directors express theirsincere appreciation for the dedication and commitment of all its employees.
| ||For and on behalf of the Board of Directors |
|Place : Vadodara ||Ashok Malhotra |
|Date : 14th August 2017 ||Chairman & Managing Director |