To The Members of PIL ITALICA LIFESTYLE LIMITED
The Directors of your Company have pleasure in presenting the Twenty Seventh (27th)Annual Report together with the Audited accounts of the Company for the year ended March31 2019.
1. FINANCIAL HIGHLIGHTS
Your Company's performance during the year as compared to the previous year issummarized below: (Rs. in Lakhs)
|Particulars ||2018-2019 ||2017-2018 |
|Revenue from Operations ||5410.49 ||7319.83 |
|Profit before Taxation ||372.28 ||607.70 |
|Less: Tax Expenses ||(58.00) ||(472.01) |
|Profit after Tax ||314.28 ||1079.71 |
|Add: other Comprehensive Income ||- ||4 ( .77) |
|Add: Balance brought forward from Previous year ||(775.33) ||(1850.27) |
|Balance Profit/(Loss) carry forward to the next year ||(461.05) ||(775.33) |
2. STATE OF COMPANY'S AFFAIRS
The Company is engaged in the manufacturing of plastic moulded furniture such asplastic chairs tables trolley sun loungers crates storage bins waste bins etc.During the year the Company clocked turnover of Rs.5410.49 Lakhs against Rs. 7319.83 Lakhsin corresponding previous year and earned a net profit of Rs. 314.28 Lakhs. The company iscarrying out its activities in mainly three segments i.e. Rs. 4314.26 Lakhs (P.Y.- Rs.4241.11 Lakhs) fr om manufacturing of plastic articles Rs. 741.54 Lakhs (P.Y.- Rs.2669.81 Lakhs) from trading and Rs 268.74 Lakhs (P.Y.- Rs. 366.24 Lakhs) from finance andinvestment activities during the year.
Your Directors & Management along with the entire team is taking all possibleaction to ensure that we are able to sustain our financial growth and business operationaldevelopments inspite of all adverse external conditions & competition.
Keeping in view the requirement of funds for future expansions your directors do notrecommend any dividend for the year ended on March 31 2019.
4. SHARE CAPITAL
The Paid-up Equity Share Capital of the Company as on 31st March 2019 stood at Rs.2350.00 Lakhs comprising of 235000000 shares of Re. 1/-each. The Company has not issuedany further shares during the year. The Listing Fees for the year 2019-20 have been paid.
5. CHANGES IN THE NATURE OF BUSINESS
There is no change in the nature of the business of the company.
6. MATERIAL CHANGES AND COMMITMENTS
There are no material changes and commitments affecting the financial position of thecompany which have occurred between the end of the financial year of the Company to whichthe financial statement relates and the date of report.
During the year the Company had export of Rs.18.30 Lakhs against export of Rs.39.02Lakhs in comparison to previous year. The Company has exported its products such aschairs tables jumbo stools in the established markets of Qatar. The Company plans tofurther increase its exports to the existing and new markets and also tap potential exportmarkets for which emphasis is being made on new and fine quality products.
8. TRANSFER TO RESERVES
No amount is proposed to be transferred to the Reserves for the financial year 2018-19.
The Company has not accepted any deposit falling within the purview of provisions ofSection 73 of the Companies Act 2013 ("the Act") read with the Companies(Acceptance of Deposit) Rules 2014 during the year under review.
10.PARTICULARS OF LOANS GUARANTEE AND INVESTMENTS UNDER
Details of loans guarantee and investments covered under provision of Section 186 ofthe Companies Act 2013 are given in the notes to Financial Statements.
11. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH
The Company has not entered into any contract or arrangement with any person includingpersons covered under sub section (1) of section 188 of the Companies Act 2013. Thedisclosures are mentioned in the Notes to Financial statements. The policy on RelatedParty Transactions as approved by the Board of Directors has been uploaded on theCompany's Website: www.italicafurniture.com.
12.EXTRACT OF ANNUAL RETURN
Extract of the Annual Return in Form MGT9 as required under section 92(3) of thecompanies Act 2013 is annexed as annexure A of this report. The annual return of thecompany has been placed on the website of the company and can be accessed atwww.italicafurniture.com.
13.NUMBER OF MEETINGS OF THE BOARD
During the financial year 2018-19 the Board met Four (04) times on 18ht May2018 10ht A ugust 2018 31st October 2018 and 02nd February2019.
14.COMMITTEE OF BOARD OF DIRECTORS
As on 31 March 2019 the Board has 3 Committees namely the Audit Committee theNomination and Remuneration Committee and Stakeholders Relationship Committee. A detailednote on the Composition of the Board and its Committees and other relevant details isprovided in the report on Corporate Governance annexed to this report.
15.DETAILS OF SUBSIDIARY JOINT VENTURE OR ASSOCIATE
As on March 31 2019 the Company does not have any subsidiary joint venture orassociate. The Policy for determining material subsidiary is placed on the website of theCompany www. italicafurniture.com.
The Company believes that managing risks helps in maximizing returns. A risk managementPolicy have been developed and implemented by the company for identification of elementsof risk if any which in opinion of board may threaten the existence of the company. Itaims to identify commodity prices Price fluctuation of raw material and finished goodsCredit Risks inflation Strategic Risks etc. The effectiveness of risk managementframework and system is periodically reviewed by Board of Directors of the company.
However in the opinion of Board none of the above-mentioned risks threaten theexistence of the company.
17.DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
a) DIRECTORS :
The tenure of Mrs. Namrata Babel (DIN: 06910061) as an Independent Director of theCompany will expire on this annual general meeting .i e. 28.06.2019. The Board recommendedthe reappointment of Mrs. Namrata Babel (DIN: 06910061) as an Independent Director forsecond term of 5 (five) consecutive years from the date of this Annual General Meetingi.e. 28.06.2019 to 27.06.2024 subject to the approval of the shareholders.
Pursuant to the provisions of the Companies Act 2013 and in terms of the Articles ofAssociation of the Company Mr. Mukesh Kumar Kothari Non Executive Director (DIN:03103336) retires by rotation at the 27th Annual General Meeting and beingeligible offers himself for re-appointment.
A brief resume nature of expertise details of directorships and other information ofdirectors proposed to be appointed/ re-appointed as stipulated in Secretarial Standard 2and Regulation 36 of Listing Regulations is appended as an annexure to Notice of ensuingAGM.
b) KEY MANAGERIAL PERSONNEL :
Mr. Narendra Bhanawat (DIN: 00146824) Whole time Director of the Company was appointedon 29.05.2016 and his present tenure will expire on 28.05.2019. The Board at their meetingheld on 15.05.2019 reappointed him for a period of two years with effect from 29.05.2019to 28.05.2021. Accordingly Board recommends appointment of Mr. Narendra Bhanawat for theconsideration of the members of the Company at the ensuing Annual General Meeting. Duringthe financial year 2018-19 Mr. Chirag Gupta acted as Company Secretary and ComplianceOfficer of the Company. Mr. Chirag Gupta resigned on 22nd April 2019 from his post andThe Board appointed Ms. Aditi Parmar as Company Secretary and Compliance Officer of theCompany with effect from April 23 2019.
18.DECLARATION BY INDEPENDENT DIRECTOR
All the Independent Directors of the Company have given their declarations o t theCompany under Section 149(7) of the Act that they meet the criteria of independence asprovided under Section 149(6) of the Act and Regulation 16(1)(b) of Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 (the Listing Regulations').
In the opinion of the Board they fulfill the conditions of independence as specifiedin the Act and the Listing Regulations and are independent of the management.
In terms of the provisions of Section 139 of the Companies Act 2013 M/s. Ajay Paliwal& Co. Chartered Accountants Udaipur (ICAI FRN: 012345C) have been appointed asAuditors of the Company to hold the office from the conclusion of the 24th Annual GeneralMeeting held on 23rd July 2016 until the conclusion of the 29th Annual General Meeting tobe held in the financial year 2021-22 subject to ratification of their appointment by themembers of the Company at every AGM. Pursuant to the amendments made under Section 139 ofthe Companies Act 2013 by the Companies (Amendment) Act 2017 effective from May 07 2018the requirement of seeking ratification of the members for the appointment of statutoryauditors has been withdrawn from the statute. In view of the above ratification ofmembers for continuance of their appointment at this Annual General Meeting is not beingsought. The company has received consent from the auditors that their firm is eligible tobe reappointed as statutory auditors of the company in accordance with the limitsspecified under Section 141 of the Act and Rules framed thereunder.
The Audit Report received by M/s. Ajay Paliwal & Co. Chartered Accountants forthe Financial Year 2018-19 does not contain any qualification or adverse remark.
21.SECRETERIAL AUDITORS AND THEIR REPORT
The secretarial audit report given by M/s P. Talesara & Associates PracticingCompany Secretary under the provisions of Section 204 of the Companies Act 2013 for theFinancial Year 2018-19 does not contain any qualification reservation or adverse remark.The secretarial audit report is provided as Annexure B forming part of this report.
22.MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015Management Discussion and Analysis Report is presented as a separate section as AnnexureC forming part of annual report.
Pursuant to Section 148 of the Companies Act 2013 read with Companies (Cost Recordsand Audit) Amendment Rules 2014 appointment of cost auditor is not applicable to thecompany.
Chief Executive Officer and Chief Financial Officer compliance certificate asstipulated under Regulation 17(8) of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 (Listing Regulations) isannexed in this report.
25.PARTICULARS OF CONSERVATION OF ENERGY TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed pursuant o t Section 134 of theCompanies Act 2013 are as follows :
A. CONSERVATION OF ENERGY
Your company is continuously engaged in the process of energy conservation and iscontinuously putting its efforts to improve energy management by way of monitoring energyrelated parameters on regular basis.
To achieve the above objective the following steps are taken to cut down theconsumption of energy :
(i) Replacement of old Lighting with LED lights at offices and plant location.
(ii) Installation of automatic power controllers to save maximum charges and energy.
(iii) Continuously replacing the inefficient equipment's with latest energy efficienttechnology and upgradation of equipment's continually.
(iv) Creating awareness of energy saving within the organization to avoid wastage ofenergy.
B. TECHNOLOGY ABSORPTION
(i) Efforts made towards technology absorption: Continuously monitoring the productionpatterns.
Constantly striving towards developing of new designs and products.
Investing in new mould and machinery.
(ii) Benefits derived as a result of the above efforts:
In crease in the production along with the improvement in quality.
New and Innovative designed products.
New designed products are also catching attention of the export market.
(iii) The company has not imported any technology during the year under review and alsothe expenditure incurred on Research and Development activity is insignificant.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
The total foreign exchange Earning / Outgo is as follows:
| || ||(Rs in Lakhs) |
|Particulars ||2018-2019 ||2017-2018 |
|Foreign Exchange Earning ||18.30 ||39.02 |
|Foreign Exchange Outgo ||NIL ||NIL |
26.CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company does not qualify under the provisions of Section 135 of the Companies Act2013. The profit before tax was Rs. 372.28 Lakhs which is below the threshold limit. Hencethe company is not required to constitute Corporate Social Responsibility committee as itdoes not fall under the purview of Section 135 of the Companies Act 2013.
27.NOMINATION AND REMUNERATION POLICY
The Company has in place the Nomination and Remuneration Committee. The Company hasformulated the Nomination and Remuneration Policy on Directors Key Managerial Personneland Senior Managerial Personnel their appointment and remuneration including the criteriafor determining qualifications positive attributes and independence of director. TheRemuneration Policy is annexed as Annexure D of this report and placed on thewebsite of the company www.italicafurniture.com.
28.CORPORATE GOVERNANCE REPORT
The report on Corporate Governance as stipulated under Regulation 34(3) read with ParaC of Schedule V of the Listing Regulations is annexed as
29.ANNUAL PERFORMANCE EVALUATION
During the year under review pursuant to the provisions of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Board hascarried out an Annual Performance evaluation of its own performance the Directorsindividually as well as the evaluation of the working of its various Committees.
A separate meeting 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 judgement safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board at its meeting following the meeting of Independent Directors.
30.INDEPENDENT DIRECTORS TRAINING/ MEETING
During the year under review a separate meeting of the Independent Directors of theCompany was held on February 02 2019 without the presence of other Directors and membersof Management. The Independent Directors reviewed the performance of Non-IndependentDirectors and the Board as a whole performance of Chairperson of the Company and assessedthe quality quantity and timelines of flow of information between the Company managementand the Board.
31.FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
All Independent Directors are familiarized with the Company their roles rightsresponsibilities in the Company nature of the industry in which the Company operatesbusiness model of the Company etc. from time to time.
The Company makes consistent efforts to acquaint the Board with the overall businessperformance covering all Business verticals by way of presenting specific performance ofeach Plant (based on predefined factory rating parameters) Product Category and CorporateFunction from time to ti me. Details of familiarization programme to company's independentdirectors can be accessed at the company's website www.italicafurniture.com under policyhead.
32.ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY
The code of conduct and Vigil Mechanism applicable to directors and senior managementof the company is available on the company's website at www.italicafurniture.com
33.DISCLOSURE ON THE REMUNERATION OF MANAGERIAL PERSONNEL
None of the employees was in receipt of remuneration excess of the limits prescribedunder rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.
Details pertaining to remuneration as required under section 197(12) of the CompaniesAct 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are given below:
|1. The ratio of remuneration of each director to the median remu- neration of the employees of the company for the FY 2018-19 ||Mr. Daud Ali ||18.96 :1 || |
| ||Mr. Narendra Bhanawat ||1.77 :1 || |
|2. The percentage increase in remuneration of each Director CFO CEO CS or manager in FY 2018-19 ||Name ||Designation ||Increase in Remuneration in the Financial Year |
| || || ||2018-19 |
| ||Mr. Daud Ali ||Managing Director ||16.67% |
| ||Mr. Narendra Bhanawat ||Whole time Director and Chief Financial Officer ||12.24% |
| ||Mr. Chirag Gupta ||Company Secretary ||25.87% |
|3. The percentage increase in the median remuneration of employees in the financial year 2018-19 ||The percentage increase is 18.87% |
|4. The number of permanent employees on the rolls of the comp- any as on March 31 2019 ||51 employees as at March 31 2019 |
|5. Average percentile increases already made in the salaries of employees other than managing personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if t h ere are any exceptional circumstances for increase in the managerial remuneration. ||Average percentage increase in the salaries of employees other than managerial personnel is 31.58 % whereas managerial remuneration has increased by 16.27%. The management was drawing minimal salary so as to plough back company's profits. |
|6. Affirmation that the remuneration is as per the remuneration- policy of the company ||It is affirmed that the remuneration paid is as per the remuneration policy of the company. |
34.DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORK PLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
During the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
The Company has already entered into agreements with both the depositories i.e.National Securities Depository Limited (NSDL) and Central Depository Services (India)Limited (CDSL).
36.INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Details regarding internal control system and their adequacy forms part of ManagementDiscussion and Analysis report forming part of Directors Report.
37.INTERNAL FINANCIAL CONTROL
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation were observed.
38.COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND ANNUAL GENERAL MEETINGS
The Company has complied with Secretarial Standards issued by the Institute of CompanySecretaries of India on Board Meetings and Annual General Meetings.
39.FRAUDS AGAINST THE COMPANY
The auditors have not reported frauds under sub-section (12) of section 143 of theCompanies Act 2013.
40. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act 2013 the directors to the best oftheir knowledge and belief confirm that:
i) in the preparation of the annual accounts the applicable Indian accountingstandards had been followed along with proper explanation relating to the materialdepartures;
ii) the directors had selected such accounting policies and applied them consistentlyand made judgment and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
iii) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
vi ) the directors had prepared the annual accounts on a going concern basis;
v) the directors had laid down Internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Your directors state that no disclosure on reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
a) Issue of Equity Shares with differential voting rights as to dividend voting orotherwise.
b) Business Responsibility Statement
c) Issue of shares (including sweat equity shares) to employees of the company underany scheme.
d) No significant and material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and company's operations in future.
Your Directors express their deep sense of appreciation for the contribution made bythe staff workers and all other employees of the Company for the successful growth in theoperations of our business.
The Directors also thank the banks financial Institutions customers suppliersshareholders central and state government authorities etc. for th eir continuousco-operation and support that contributed in the growth and prosperity of your Company.Your Directors look forward to the continued support of these partners in progress.
For and on behalf of the Board of Directors
| ||Sd/- ||Sd/- |
| ||DAUD ALI ||NARENDRA BHANAWAT |
| ||Managing Director ||Whole Time Director & Chief Financial Officer |
|Place : Udaipur || || |
|Date : 15.05.2019 ||DIN: 00185336 ||DIN: 00146824 |