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Premco Global Ltd.

BSE: 530331 Sector: Industrials
NSE: N.A. ISIN Code: INE001E01012
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NSE 05:30 | 01 Jan Premco Global Ltd
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VOLUME 3610
52-Week high 156.00
52-Week low 43.75
P/E
Mkt Cap.(Rs cr) 15
Buy Price 47.25
Buy Qty 400.00
Sell Price 45.60
Sell Qty 400.00
OPEN 46.00
CLOSE 46.70
VOLUME 3610
52-Week high 156.00
52-Week low 43.75
P/E
Mkt Cap.(Rs cr) 15
Buy Price 47.25
Buy Qty 400.00
Sell Price 45.60
Sell Qty 400.00

Premco Global Ltd. (PREMCOGLOBAL) - Director Report

Company director report

To the Members of PREMCO GLOBAL LIMITED your Directors have pleasure in presentingtheir Thirty Fifth Premco Global Limited Annual Report together with the Audited Accountsfor the year ended 31st March 2019.

1. FINANCIAL SUMMARY HIGHLIGHTS

The FINANCIAL Performance for fiscal 2018-2019 is summarized in the following table:

Rs. in Lakhs

PARTICULARS Standalone Consolidated
March 2019 March 2018 March 2019 March 2018
Revenue from Operations 5323.39 6567.42 7212.41 8136.64
Expenses 4985.15 5609.82 6409.93 7044.55
Profit Before Finance Cost Depreciation & Amortization Exp 338.24 957.6 802.48 1092.09
Finance Cost 79.62 83.41 150.17 100.36
Depreciation & Amortization Exp. 171.81 191.44 271.84 273.90
Profit before Exceptional Items 86.81 682.75 380.47 717.81
Extra Ordinary Items (106.56) - (106.56) -
Profit before Taxation (19.75) 682.75 273.91 717.81
Less : Provision for current Taxation 19.16 234.49 19.16 234.49
Deferred Taxation adjustment (54.78) (57.56) (54.78) (57.56)
Profit After Taxation 15.87 505.82 309.53 540.88
Minority Interest - - (48.82) (14.41)
Other Comprehensive Income (Net of Tax) 79.17 1.65 79.17 1.65
TOTAL Comprehensive Income 95.04 507.47 339.88 528.12
Paid up Equity Share Capital 330.48 330.48 330.48 330.48
Earnings Per Share (Rs.) 2.88 15.36 10.28 15.98

FINANCIAL PERFORMANCE OPERATIONS AND STATE OF THE COMPANY'S AFFAIRS STANDALONEANALYSIS

During the year under review Company's revenue from operations stood at Rs. 5323.39Lacs as against Rs.6567.42 Lacs in the previous year The Company has earned a Net profitafter Tax of Rs. 15.87 Lacs as compared to the Net Profit after Tax of Rs. 505.82 Lacsduring the previous accounting year.

The Company's EBDIT for the year on STANDALONE basis was at Rs 338.24 Lacs as againstRs. 957.6 Lacs.

The STANDALONE

Profit after Tax of the Company Stood at Rs 15.87 as against Rs. 505.82 Lacs.

Extraordinary item includes expenditure of Rs. 106.56 Lakhs booked towards reversal ofGST credit on inventory held as on date of implementation of GST law i.e. Rs. 82.25 forTrans 1 credit (01.07.2017) & Rs. 24.31 for in-advert credit ( 01.08.2018). On theSTANDALONE basis Company's other operating revenue was lower by 67.02 % (Rs. 145.77 Lacs)due to lower duty drawback incentives post GST era w.e.f. 01.10.2017. Company has sincerevised the export prices to cover the cost. Other income was higher by 6.33% (Rs. 23.70Lacs) as compared to previous year.

Domestic sales were lower by 10% (Rs. 295.98 Lacs) as compared to previous year. Thedecline was mainly on account of Lower domestic demand due to floods in Central&Southern part of India.

The Company exports were lower by 23% i.e. (Rs. 713.94 Lacs). This was on account oflower trading activity with company's own subsidiary & lower sales to one of our largecustomers.

PGVL Vietnam was able to develop and &procure supplies locally thereby reducingthe Raw Material sourcing from India.

The Company was able to pass on the lower duty drawback effect due to reduction inRates to export customers thereby improving the RM Consumption to Sales ratio by 3.36 %.

There is an increase in RM Cost of Rs. 61.56 Lacs due to increase in RM Prices TheCompany has incurred expenses (other than RM Cost) of Rs. 2496.59 Lacs in current year ascompared to previous year of Rs. 2435.03 Lacs. Also Employee cost increased by Rs 25.15Lacs as compared to previous year which was on account of new recruitment in theMarketing division which would strongly focus on new Markets and building businesswith big brands Internationally and in India .

There has been decline in finance cost of Rs. 3.79 Lacs and Depreciation by Rs. 19.63Lacs during the FINANCIAL year.

The Company's manufacturing expenses were higher by Rs. 59.83 Lacs due to revision inContract / Piece rate & high electricity rates / cost. This was also partly due tohigher production volumes

CONSOLIDATED ANALYSIS

During the year under review On Consolidated basis revenue from operations stood atRs. 7212.41 Lacs as against Rs. 8136.64 Lacs in the previous year and Net

Profit after Tax stood at 309.53Lacs as compared to the Net Profit after Tax of Rs.540.88Lacs during the previous accounting year.

The Company's Consolidated EBDIT for the year stood at Rs. 802.48Lacs as against Rs.1092.09Lacs The Consolidated Profit after Tax of the Company Stood at Rs. 309.53Lacs asagainst Rs. 540.88Lacs.

On the Consolidated basis Company's other operating revenue was lower by 67.02 % (Rs.145.77 Lacs) due to lower duty drawback incentives post GST era w.e.f. 01.10.2017. Companyhas since revised the export prices to cover the cost. Other income was increased by 4.90% (Rs. 14.66 Lacs) as compared to previous year.

The Company exports were lower by 8.23% i.e. (Rs. 388.01 Lacs). This was on account oflower sales to one of our large customers as well as depressed market for all textileproducts due to poor retail sales globally. Company's GrossMargins (Sales minus RM Cost onproducts improved substantially from 46.54% to 53.80% ensuring net saving of Rs. 503.71Lacs.

The Company has incurred expenses (Other than RM Cost) of Rs. 3632.59 Lacs in currentyear as compared to previous year of Rs. 3350.04 Lacs. There is a slight increase inexpenses of Rs. 282.54 Lacs on account of increase in cost of Raw Material and growingcompetition in market. The rise in cost was partly also due to different Product Mix.

Also Employee cost increased by Rs 173.20 Lacs as compared to previous year which wason account of new recruitment in the Marketing division which would strongly focus onnew Markets and building business with big brands Internationally and in India .AlsoVietnam Plant was run at Higher Capacity as compared to previous year resulting in HigherEmployee cost incurred at Vietnam.

There has been increase in finance cost of Rs. 49.81 Lacs due to higher working Capitaland Exchange Loss. Further there was a slight decline in Depreciation by Rs. 2.06 Lacsduring the FINANCIAL year.

The Company's manufacturing expenses were higher by Rs. 61.59 Lacs due to revision inContract / Piece rate & high electricity rates / cost. This was also partly due tohigher production rates.

2. SHARE CAPITAL

The issued subscribed and paid up share capital of the Company as on 31stMarch 2019 was at Rs. 330.48 lakh divided into 3304800 Equity Shares of Rs. 10 each.During the year under review the Company has not issued any shares with differentialvoting rights employee stock options and sweat equity shares.

3. DIVIDEND your Directors are pleased to recommend to the Members for theirapproval a dividend of 2/- per Equity Share of Rs. 10/- each in the Company for the yearended 31st March

2019. The TOTAL outflow on account of payment of Dividend is Rs. 66.10 Lacs and Tax onDividend shall be Rs. 13.58 Lacs.

4. RESERVES

The Company proposes to transfer Rs. 1.59 Lacs to the general reserve out of the amountavailable for appropriation

5. CHANGE IN NATURE OF BUSINESS

The Company is engaged in the business of manufacturing Woven & Knitted ElasticTapes. There was no change in nature of business activity during the year.

6. MATERIAL CHANGES AND COMMITMENTS

The Directors further states that there are no material changes have taken placeaffecting the FINANCIAL position of the Company from the date of closure of FINANCIAL yeartill the signing of Accounts.

7. DEPOSITS

The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of BALANCEsheet.

8. LOANS GUARANTEE & INVESTMENTS

Details of Loans Guarantee and Investment covered under the provision of Section 186of the Companies Act 2013 are given in the notes to the FINANCIAL Statements.

9. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board in conjunction with its committees ensures transparency responsibility andaccountability with an aim to create long-term sustainable growth. All Directors areastute professionals coming from varied backgrounds possessing rich experience andexpertise. The Board of Directors (the Board) holds a fiduciary position to promote thesuccess of the Company for the benefit of its members. They are entrusted to directmonitor and guide the Management towards building of such goals and objectives thatguarantees effectiveness and enhancement of shareholder value and fulfils theiraspirations.

COMPOSITION OF THE BOARD AS ON 31ST MARCH 2019.

Sr. No. Name of the Director Category
1 Ashok B. Harjani Chairman & Managing Director
2 Nisha P. Harjani CFO & Director
3 Lokesh P. Harjani Executive Director
4 Sonia A. Harjani Director
5 Sonu A. Chowdhary Non-Executive - Independent Director
6 Rajesh M. Mahtani Non-Executive - Independent Director
7 Prem I. Gidwani Non-Executive - Independent Director

* Mr. Devendra Shah vacated the office of Director w.e.f. 18th March 2019.

CHANGES IN THE COMPOSITION OF THE BOARD OF DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL

During the year 2018-19 under review there was a change in the composition of theBoard of Directors and other Key Managerial Personnel.

The Companies Act 2013 read with relevant Rules made there under facilitates theparticipation of Director in Board / Committee meetings through video conferencing orother audio visual mode. Accordingly the option to participate in the meeting was madeavailable for the Directors except in respect of such meetings and/or items which are notpermitted to be transacted through video conferencing.

Board Meetings held and attendance of Directors during the year 2018-19.

Sr. No. Date of Board Meeting TOTAL No. of Directors TOTAL No. of Directors Present
1 29th May 2018 8 7
2 14th August 2018 8 5
3 13th November 2018 8 8
4 12th February 2019 8 7

None of the Directors on the Board is a member in more than 10 Committees and Chairmanin more than 5 committees as specified in Regulation 26(1) of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 [the "SEBI (LODR)Regulations 2015"] across all Companies in which he/she is a Director. Thenecessary disclosures regarding Committee positions have been made by the Directors.

RETIREMENT BY ROTATION

In accordance with the provision of Companies Act 2013 and the Articles of Associationof the Company Mr. Lokesh Harjani retires by rotation and is eligible for thereappointment. Necessary information for Directors liable to retire by rotation has beenincluded in the notice convening the ensuing Annual General Meeting and requisite detailshave been provided in the explanatory statement of the notice. your directors recommendthe said appointment.

Resignation of Director

During the year under review Mr. Devendra Shah having (DIN 01254611) had beendisqualified as the director of the company as per section 164(2) read with section 167 ofthe Companies Act 2013 due to non-filing of FINANCIAL results and annual returns of thecompany for the consecutive period of 3 years. Due to which DIN number of the director wasdeactivated and company was unable to file its FINANCIAL results and annual returns.

In view of the same Mr. Devendra Shah vacated the office of Director w.e.f. 18thMarch 2019.

The Board places on record its heartiest gratitude and appreciation for the valuableadvices and continuous guidance received from Mr. Devendra Shah and the advices onstrategic issues and feel that their prolonged stewardship to the Board shall go a longway for the overall growth of the Company.

Appointment of Director

The Board of Directors at its Meeting held on 28th May 2019 appointed Mr. LalitDaulat Advani (DIN-00308138) as Additional Director with the status of Non-ExecutiveIndependent Director with effect from 28th May 2019 subject to approval of the Membersat the ensuing Annual General Meeting pursuant to Sec. 150 (2) and other applicableprovisions of the Companies Act 2013. Mr. Lalit D. Advani is not related to anyDirectors. Further Mr. Rajesh Mathani (DIN 007360941) and Mr. Prem Gidwani (DIN 01220570)were appointed as an Independent Director of the Company for a period of five years up to31st March 2019. The Nomination and Remuneration Committee and the Board at theirmeetings held on 28th May 2019 have recommended the re-appointment of Mr. Rajesh Mathani(DIN 007360941) and Mr. Prem Gidwani (DIN 01220570) as Independent Directors of theCompany for a second consecutive term from 1st April 2019 till 31st March 2024 at theforth coming Annual General Meeting of the Company Further Mr. Lalit Daulat Advani(DIN-00308138) Mr. Mr. Rajesh Mathani (DIN 007360941) and Mr. Prem Gidwani

(DIN 01220570) are not disqualified to act as Director under the provisions ofCompanies Act 2013 and rules made thereunder. Their appointment is subject to approval byMembers in forthcoming Annual General Meeting.

The term of Mr. Lokesh Prem Harjani (DIN 01496181) Executive Director and Mr. Ashok B.Harjani (DIN 00725890) Managing Director of the Company had expired on 31st March 2019the Nomination and Remuneration Committee and the Board at their meetings held on 28th May2019 have recommended the re-appointment of Mr. Lokesh Prem Harjani (DIN 01496181) asExecutive Director and Mr. Ashok B. Harjani (DIN 00725890) as Managing Director of theCompany for a further period of 5 years w.e.f 01st April 2019 at the forth coming AnnualGeneral Meeting of the Company.

KEY MANAGERIAL PERSONNEL

The following persons continued as Key Managerial Personnel of the Company incompliance with the provisions of Section 203 of the Companies Act 2013: a) Mr. Ashok B.Harjani –Managing Director b) Mrs. Nisha P. Harjani – Director - Chief FINANCIALOfficer c) *Ms. Pooja Shekhawat – Company Secretary Since Resigned with effectfrom 30th April 2019.

Remuneration and other details of the Key Managerial Personnel for the FINANCIAL yearended 31st March 2019 are mentioned in the Extracts of the Annual Return inForm MGT-9 which is enclosed as Annexure – 3 and forms part of this Report.

INDEPENDENT DIRECTOR your Company appointed Independent Directors who are renownedpeople having expertise / experience in their respective field/profession. In compliancewith Section 149(6) of the Companies Act 2013 and Regulation 16(1)(b) of the ListingRegulations all Independent Directors have given a declaration that they meet thecriteria of independence as provided under law. None of the Independent Directors arepromoters or related to Promoters. The Non-executive Independent Directors have nopecuniary relationship or transactions with the Company in their personal capacity exceptfor sitting fees drawn by them for attending the meeting of the Board and Committee(s)thereof and further do not hold two percent or more of the TOTAL voting power of theCompany.

During the year meeting of Independent Directors was held on 12th February2019 to review the performance of the Board as a whole on parameters of effectiveness andto assess the quality quantity and timeliness ofFLOW of information between themanagement and the Board. The Independent Directors discussed among other matters theperformance of the Company and risk faced by it theFLOW of information to the Boardcompetition strategy leadership strengths and weaknesses governance compliance Boardmovements human resources matters and performance of executive directors includingChairman. The Declarations required under Section 149(7) of the Companies Act 2013 fromthe Independent Directors of the Company confirming that they meet the criteria ofindependence as prescribed under Section 149(6) of the Companies Act 2013 was dulyreceived by the Company.

10. AUDIT COMMITTEE

The Audit Committee which acts as a link between the management external and internalauditors and the Board of Directors of the Company is responsible for overseeing theCompany's FINANCIAL reporting process by providing direction to audit function andmonitoring the scope and quality of internal and statutory audits.

The composition of the Committee is in compliance with the provisions of Section 177 ofthe Companies Act 2013 and Regulation 18 SEBI (LODR) Regulations 2015. The Chairpersonof the Committee is a Non-Executive Independent Director.

COMPOSITION OF AUDIT COMMITTEE OF THE COMPANY:

Sr. No. Name of the Director Category Designation
1. *Devendra Shah Non-Executive - Independent Director Chairman
2. Ashok B. Harjani Chairman & Managing Director Member
3. Rajesh M. Mahtani Non-Executive - Independent Director Member
4. **Prem I. Gidwani Non-Executive - Independent Director Chairman
5. ***Nisha P. Harjani Executive Director Member

*has resigned w.e.f. 18th March 2019.

** was appointed as the Chairman of the Committee w.e.f. 28th May 2019

*** was appointed as the Committee Member w.e.f. 28th may 2019

The Audit Committee also meets the Company's Statutory Auditors to ascertain theirviews on the FINANCIAL statement.

The Committee members meet regularly and make their recommendations in accordance withthe terms of reference specified by the Board. Such recommendations are thoroughlydiscussed in Board meetings and by and large accepted for implementation.

AUDIT COMMITTEE MEETINGS HELD AND ATTENDANCE OF DIRECTORS DURING THE YEAR 2018-19

Sr. No. Date of Board Meeting TOTAL No. of Directors TOTAL No. of Directors Present
1 29th May 2018 4 3
2 14th August 2018 4 4
3 13th November 2018 4 4
4 12th February 2019 4 4

The Audit Committee acts in accordance with the broad terms of reference specified bythe Board of Directors in adherence to Section 177 of the Companies Act 2013 (the‘Act'). The scope of activities of the Audit Committee includes the areas laid out inSection 177 of the Act and Part C of Schedule II of SEBI (LODR) Regulations 2015.

11. STAKEHOLDERS RELATIONSHIP COMMITTEE

The composition of the Committee is in compliance with the provisions of Section 178 ofthe Companies Act 2013 and Regulation 20 SEBI (LODR) Regulations 2015. The Chairman ofthe Committee is a Non-Executive Independent Director.

COMPOSITION OF STAKEHOLDER'S RELATIONSHIP COMMITTEE OF THE COMPANY:

Sr. No. Name of the Director Category Designation
1. Rajesh M. Mahtani Non-Executive - Independent Director Chairman
2. Ashok B. Harjani Chairman & Managing Director Member
3. *Devendra Shah Non-Executive - Independent Director Member
4. **Sonu A. Chowdhary Non-Executive - Independent Director Member

* has resigned w.e.f. 18th March 2019

** was appointed as the Committee Member w.e.f. 28th May 2019 Ms. Snehal Tondwalkarhad been appointed as the Company Secretary & Compliance Officer for complying withthe requirements of the Listing Regulations and requirements of securities laws includingSEBI (Prohibition of Insider Trading) Regulations 2015 in place of Ms. Pooja Shekhawat.The role of Stakeholder's Relationship Committee includes as specified in Part D of theSchedule

II of the SEBI (LODR) Regulations 2015.

STAKEHOLDER'S RELATIONSHIP COMMITTEE MEETINGS HELD AND ATTENDANCE OF DIRECTORS DURINGTHE YEAR 2017-18

Sr. No. Date of Board Meeting TOTAL No. of Directors TOTAL No. of Directors Present
1 29th May 2018 3 3
2 14th August 2018 3 3
3 13th November 2018 3 3
4 12th February 2019 3 3

M/s. Big Shares Services Pvt. Ltd. is the Registrar and Share Transfer Agent of theCompany. The delegated authority is taking measures so that the share transfer formalitiesare attended to atleast once in a fortnight. The Company Secretary is also authorized bythe Board to do all the acts deeds and matters and sign all the documents that may berequired in the matter relating to shares from time to time. No complaint was remainedunattended and pending to be resolved as on March 31 2019.

STATUS OF INVESTOR COMPLAINTS /OTHER CORRESPONDENCE

Subject matter of Correspondence Pending as on 31st March 2018 Received & resolved during the year Pending as on 31st March 2019
Non-receipt of Share - 2 -
Non-receipt of Dividend - - -
Non-receipt of Annual Report - - -
Query -Transfer of shares - - -

12. NOMINATION AND REMUNERATION COMMITTEE

The composition of the Committee is in compliance with the provisions of Section 178 ofthe Companies Act 2013 and Regulation 19 of the of the SEBI (LODR) Regulations 2015. TheChairperson of the Committee is a Non-Executive Independent Director.

COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE OF THE COMPANY:

Sr. No. Name of the Director Category Designation
1. *Devendra Shah Non-Executive - Independent Director Chairman
2. **Ashok B. Harjani Chairman & Managing Director Member
3. Rajesh M. Mahtani Non-Executive - Independent Director Member
4. Prem I. Gidwani Non-Executive - Independent Director Chairman
5. Sonu A.Chowdhary Non-Executive - Independent Director Member

* has resigned w.e.f. 18th March 2019

** has ceased to be a member of the committee w.e.f. 13th November 2018 The role ofNRC includes the areas laid out in Section 178 of the Act and Part D of Schedule II of theSEBI (LODR) Regulations 2015. The Board of Directors on recommendation of the NRC hasadopted a policy for evaluation of the Board its Committees. The details of remunerationpaid to all Directors are provided under the head "Disclosures" in this Report.Nomination & Remuneration Policy has been framed adopted and implemented by theNomination and Remuneration Committee with broad objectives for determining andrecommending the remuneration of the Directors KMP and Senior Management to the Board.The NRC meeting held on 13th November 2018 during the year 2018-19.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197(12) of Companies Act 2013 and read with Rule 5(1) and (2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2017 are formingpart of this Annual Report.

13. AUDITORS

STATUTORY AUDITORS

M/s. Sanjay Raja jain & Co Chartered Accountants Mumbai (ICAI Firm RegistrationNo. 112364W) were appointed as Statutory Auditors of the Company pursuant to theprovisions of Section 139(8) and other applicable provisions if any of the CompaniesAct 2013 as amended from time to time or any other law for the time being in force(including any statutory modification or amendment thereto or re-enactment thereof for thetime being in force) till the conclusion of the 39th Annual General Meeting of theCompany to be held in the year 2023 at such remuneration plus applicable Tax out ofPocket Expenses in connection with the audit as the Board of Directors of the Company mayfix in this behalf in consultation with the Auditors. And as per the Companies (Amendment)Act 2017 enforced on May 7 2018 by the Ministry of Corporate Affairs the appointmentof Statutory Auditors is not required to be ratified by the Members at every AnnualGeneral Meeting.

SECRETARIAL AUDITORS

During the year Secretarial Audit was carried out by M/s. Sanjay Dholakia &Associates (Membership No. F2655) a firm of Company Secretaries in Practice theSecretarial Auditor of the Company for the FINANCIAL year 2018-19 Pursuant to theprovisions of Section 204 of the Companies Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014. The observations of the SecretarialAuditor are self-explanatory. The detailed report on the Secretarial Audit is attached asforming part of this Annual Report.

14. COMPLIANCES UNDER COMPANIES ACT 2013 SHARE CAPITAL

The Issued subscribed and Paid-up Equity Share Capital of Company has remainedunchanged during the year. During the year under review the Company has not issued anysecurities convertible Warrants/Bonds and/or other debt securities which has likelyimpact on the Equity of the Company.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return pursuant to the provisions of Section 92 of the Act readwith Rule 12 of the Companies (Management and Administration) Rules 2014 is furnished inForm MGT - 9 is forming part of the Annual Report.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT2013

Details Loans guarantees and Investments covered under the provisions of Section 186of the Companies Act 2013 are given in the notes to FINANCIAL statements.

INSURANCE your Company has taken appropriate insurance for all assets againstforeseeable perils.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and formingpart of the Directors' Report for the year ended 31st March 2018 is given in aseparate Annexure to this Report.

The above Annexure is not being sent along with this Report to the Members of theCompany in line with the provision of Section 136 of the Companies Act 2013. Members whoare interested in obtaining these PARTICULARS may write to the Company Secretary at theRegistered Office of the Company.

The aforesaid Annexure is also available for inspection by Members at the RegisteredOffice of the Company before the 24th Annual General Meeting and upto the dateof the ensuing Annual General Meeting during the business hours on working days.

None of the employees listed in the said Annexure is a relative of any Director of theCompany. None of the employees hold (by himself or along with his spouse and dependentchildren) more than two percent of the equity shares of the Company.

15. RELATED PARTY TRANSACTIONS

The Company has formulated a policy on dealing with Related Party Transaction. Thepolicy is placed on the website of the Company. All the transactions entered into withRelated Parties as defined under the Companies Act 2013 Regulation 2(1)(zc) andRegulation 23 of SEBI (LODR) Regulations 2015 during the FINANCIAL year were in theordinary course of business and on an arm's length basis and do no attract the provisionsof Section 188 of the Companies Act 2013. During the year the Company has not enteredinto any contract / arrangement / transactions with related parties which can beconsidered material in nature. The Related Party Transactions are disclosed in the notesof FINANCIAL statements for the FINANCIAL year 2018-19 and the same is furnished in FormAOC-2 and is forming part of Annual Report.

16. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of knowledge and belief and according to the information and explanationsobtained by them your Directors make the following statement in terms of Section134(3)(c) of the Act:

i. that in the preparation of the Annual Accounts for the year ended March 31 2019the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;

ii. the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2019 and of the profit ofthe Company for the year ended on that date;

iii. at the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. that the Directors had laid down internal FINANCIAL controls to be followed by theCompany and that such internal FINANCIAL controls are adequate and were operatingeffectively; and vi. that the Directors had devised proper systems to ensure compliancewith the provisions of all applicable laws and that such systems were adequate andoperating effectively.

Based on the framework of Internal FINANCIAL controls and compliance systemsestablished and maintained by the company work performed by the internal statutory andsecretarial auditors and external consultants including audit of internal FINANCIALcontrols over FINANCIAL reporting by statutory auditors and the reviews performed bymanagement and the relevant board committees including the Audit committee the board isof the opinion that company's internal FINANCIAL controls were adequate and effectiveduring the Fy 2018-19.

17. RISK MANAGEMENT POLICY AND FRAMEWORK

The Company's risk management policy and framework is based on a clear understanding ofvarious risks disciplined risk assessment and measurement procedures and continuousmonitoring. The policies and procedures established for this purpose are continuouslybenchmarked with industry best practices. The Board of Directors has oversight on all therisks assumed by the Company. The Board reviews the level and direction of major riskspertaining to market liquidity operational compliance and capital at risk as part ofrisk profile overview.

The Audit Committee of the Board provides direction to and monitors the quality of theinternal audit function and also monitors compliance with inspection and audit reports ofstatutory and internal auditors of the Company.

18. BOARD EVALUATION

Pursuant to the provisions of the Companies Act 2013 and Regulation 17(10) of SEBI(LODR) Regulations 2015 the Board has carried out an annual performance evaluation of itsown performance and that it's statutory committee and that of the individual directors.Independent Directors at their meeting without the participation of the Non-independentDirectors and Management considered / evaluated the Boards' performance Performance ofthe Chairman and other Non-independent Directors. The Board has undergone a formal reviewwhich comprised Board effectiveness and review of materials.

The Board of Directors expressed their satisfaction with the evaluation process.

COMPANY'S CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING

In accordance with the requirements of the Securities and Exchange Board of India(Prohibition of Insider Trading) Regulations 2015 the Company has also in place acomprehensive code of conduct for prevention of insider trading.

19. CORPORATE GOVERNANCE

The Company is adhering to good corporate governance practices in every sphere of itsoperations. The Company has complied with the Corporate Governance requirements under theCompanies Act 2013 and as stipulated under Regulations 17 to 27 of the SEBI ListingRegulations) read with schedule II thereof. A separate report on Corporate Governanceforms part of this Report along with the Certificate from the Practicing Company Secretaryconfirming compliance with the conditions of Corporate Governance.

20. CORPORATE SOCIAL RESPONSIBILITY

The Company has a Policy on Corporate Social responsibility (CSR) duly approved by theBoard and the same has been hosted on Company's website at www. premcoglobal.com. The CSRbudget for the FINANCIAL year 2018-2019 was prepared in accordance with the provisions ofSection 135 (5) of the Companies Act 2013 read with the Company's CSR Policy. The amountso budgeted was fully spent on or before 31st March 2019 the detailed reporton CSR Activities/ Initiatives is enclosed as Annexure-2 which forms part of thisReport. (Annexure 4)

21. ANNUAL RETURN & EXTRACTS OF ANNUAL RETURN

In compliance with Section 134 (3)(a) of the Companies Act 2013 the Annual Return ofthe Company shall be made available on the website of the Company at www. premcoglobal.com. Extract of Annual Return enclosed as Annexure 3.

22. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

Pursuant to Section 177(9) read with Regulation 22 of the SEBI Listing Regulationsyour Company has duly established Vigil Mechanism for Directors and employees to reportconcerns about unethical behavior actual or suspected fraud or violation of company'scode of conducts or ethics policy. Audit Committee of the Board monitors and oversee thevigil mechanism.

The detailed policy related to this vigil mechanism is available in the Company'swebsite at www.premcoglobal. com.

23. RISK MANAGEMENT POLICY

The Company's business faces various risks - strategic as well as operational inrespect of all its Divisions. The Company has an adequate risk management system whichtakes care of identification assessment and review of risks as well as their mitigationplans put in place by the respective risk owners. The risks which were being addressed bythe Company during the year under review included risks relating to market conditionsenvironmental information technology etc. The Company has developed and implemented theRisk Management Policy with an objective to provide a more structured framework forproactive management of all risks related to the business of the Company and to make itmore certain that growth and earnings targets as well as strategic objectives are met. Thedevelopment and implementation of risk management policy has been covered in themanagement discussion and analysis which forms the part of this report.

The Audit Committee of the Board reviews the risk assessment and minimization procedurein the light of the Risk Management Policy of the Company.

In the opinion of the Board there is no such element of risk which may threaten thepresent existence of the Company.

24. INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013

The Company has in place a Prevention of Sexual Harassment Policy in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.

The Company has been employing women employees in various cadres. There were noinstances taken place in the Company during the year which are required to be reportedunder Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013.

25. Quality Policy your Company strive for ‘excellence' by providingcustomized solutions products & services that best satisfies the requirements of ourCustomers and continuously improve quality reliability & service with the help of aneffective Quality Management System encompassing all statutory regulatory healthsafety & environment requirements at our work place.

26. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

Independent Directors are familiarized with their roles rights and responsibilities inthe Company as well as with the nature of industry and business model of the Companythrough induction programmers' at the time of their appointment as Directors and throughpresentations on economy & industry overview key regulatory developments strategyand performance which are made to the Directors from time to time.

27. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES:

The Company does not have joint Ventures/Associate Companies. The Company hasincorporated foreign subsidiary in Vietnam viz. Premco Global Vietnam Company Limited inwhich it holds 85%.

28. HUMAN RESOURCE

Company treats its "human resources" as one of the most important assets. TheManagement of the Company lays continuous focus on human resources who are trained andupdated on various issues from time to time to attain the required standards. The correctrecruitment practices are in place to attract the best technical manpower to ensure thatthe Company maintains its competitive position with respect to execution. your Companycontinuously invests in attraction retention and development of talent on an ongoingbasis.

29. INTERNAL CONTROL AND ITS ADEQUACY

The Company has adequate internal controls and processes in place with respect to itsFINANCIAL statements which provide reasonable assurance regarding the reliability ofFINANCIAL reporting and the preparation of FINANCIAL statements. These controls andprocesses are driven through various policies procedures and certifications. Theprocesses and controls are reviewed periodically. The Company has a mechanism of testingthe controls at regular intervals for their operating effectiveness to ascertain thereliability and authenticity of FINANCIAL information.

30. Transfer of Unclaimed Dividend and Shares to Investor Education and ProtectionFund (IEPF)

In compliance with the provisions of Section 124 (5) of the Companies Act 2013 readwith Investor Education and Protection Fund Authority (Accounting Audit Transfer andRefund) Rules a sum of Rs. 187215 being the dividend lying unclaimed out of thedividend declared by the Company for the FINANCIAL year 2010-2011 were transferred toIEPF. The details of the said unclaimed dividend transferred is available at the websiteof the Company at https://www. premcoglobal.com/investors Similarly During the periodunder review 22490 Equity Shares pertaining to FINANCIAL year 2009-2010 have beentransferred to IEPF dated 19.07.2019 Authorities vide Corporate Action in compliance withthe provisions of Section 124 of the Companies Act 2013 and Rule 6 of Investor Educationand Protection Fund Authority (Accounting Audit Transfer and Refund) Rules 2016 aftersending letters to those Shareholders and also making an advertisement in the newspapersin this regard. Details of these shares transferred to IEPF are available on the websiteof the Company at https://www.premcoglobal.com/ investors

31. SIGNIFICANT AND MATERIAL ORDERS:

There are no Significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future.

32. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION ETC. & FOREIGN EXCHANGEEARNINGS AND OUTGOINGS:-

The information as required under Section 134(3)(m) of the Companies Act 2013 readwith Rule 8(3) of the Companies (Accounts) Rules 2014 with respect to conservation ofenergy technology absorption and foreign exchange earnings is given below:

A. Conservation of energy:

I. The steps taken or impact on conservation of energy

The Company has replaced the 36w/40w tube lights with 16w LED tube lights whichconsumes 50% less energy.

II. The steps taken by the company for utilising alternate sources of energy

The Company's present outlay does not recommend for alternate source of energy. TheCompany intends to replacing high capacity motors in covering dept. with energy efficientnew motors which should give a huge saving.

III. The capital investment on energy conservation equipments

As explained in point No.(ii) above the Company do not propose any major capitalinvestment on energy conservation equipments because the existing arrangement aresufficient to cater the company need and are cost effective.

B. Technology absorption:

I. The efforts made towards technology absorption.

The Company has replaced some of the machines with high speed / upgraded version. TheCompany is also working on its super soft yarn technology which will help the Company toimprove the quality of products.

II. The benefits derived like product improvement cost reduction productdevelopment or import substitution

The improved efficiency in production has resulted in substantial cost reduction due tolower wastages. The Company is endeavor to deliver best quality products at a lower cost.

III. The details of technology imported

Last year the company had imported higher hook j/Q machines to weave wider j/Qdesigns. The Company is also foraying into innovative and niche products with printing andvalue added finishes.

C. Foreign exchange earnings and Outgo:

The Foreign Exchange earned in terms of actual inflows during the year and the ForeignExchange outgoes during the year are:

(Rs. In Lacs)

PARTICULARS 2018-19 2017-18
Foreign Exchange Earning 2354.62 3068.55
Foreign Exchange Outgo
-Raw Materials & Spares 1.18 22.26
-Capital Goods 52.13 16.38
-Travelling 76.05 62.57
-Expenses for Export 7.96 22.65
-Insurance Charges 0.53 0.96
-Professional Fees 9.22 -

33. MANAGERIAL REMUNERATION

A) Details of the ratio of the remuneration of each director to the median employee'sremuneration and other details as required pursuant to Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel)Rules 2014

Name of the Director Designation Ratio of remuneration to median remuneration to all employees
Ashok B. Harjani Chairman & Managing Director 25.46
Lokesh P. Harjani Executive Director 17.84
Nisha P. Harjani CFO & Director 11.46
Sonia A. Harjani Director 1.03

B) The percentage increase in remuneration of each

Director Chief FINANCIAL Officer Chief Executive Officer Company Secretary.

PARTICULARS % increase in remuneration
Ashok B. Harjani Managing -
Director
Lokesh P. Harjani Executive -
Director
Nisha P. Harjani CFO & Director -
Sonia A. Harjani Director -
Shantanu Dey Ex-CEO -
R.C. Panwar CEO -
Snehal Tondwalkar Company -
Secretary

-Independent Directors are given only sitting fees which is same as last year.

C) Percentage increase in the median remuneration of employees in FINANCIAL year 6%.

D) The number of permanent employees as on 31st March 2019 was 170.

E) Explanation on relationship between average increase in remuneration and Companyperformance:

- The increase in remuneration is in line with market trends and also with Company'sPerformance

- Comparison of remuneration of key managerial personnel against performance of thecompany

(Rs. In Lacs)
Aggregate Remuneration of Key Managerial Personnel (KMP) 163.92
Revenue 5323.39
Remuneration of KMPs (as % of revenue) 3.02 %
Profit Before Tax Remuneration of KMP( as % of PBT) (19.75)

F) Variation in Market Capitalization of the Company

Price Earnings ratio of current FINANCIAL year and previous FINANCIAL year:

(Rs. In Lacs)
PARTICULARS March 31 2019 March 31 2018 % change
Market Capitalization 4659.76 10586.92 (-) 55.98 %
Price Earnings Ratio 48.96 20.89 (-) 134.37%

G) Company has not made any public offer in the recent previous and accordingly thecomparison of public offer price and current market price would not be relevant.

H) Average percentile increase already made in the salaries of employees other than themanagerial personnel in last FINANCIAL year and its comparison with the percentileincrease in managerial remuneration and justification thereof and point out if there areany exceptional circumstances for increase in the managerial.

I) It can be seen that increase in managerial remuneration is quite minimal as comparedto last year whereas the employee's remuneration has been increased as per market trends.There have been no exceptional circumstances for increase in managerial remuneration.

j) Comparison of each remuneration of the key managerial personnel against theperformance of the Company:

(Rs. In Lacs)
Ashok B. Harjani Lokesh P. Harjani Nisha P. Harjani Shantanu Dey Ramesh Chandra Panwar Pooja Shekhawat
Managing Director Executive Director Chief Financial officer Chief Executive Officer (upto june 2018) Chief Executive Officer (from March 2019) Company Secretary (from feb'18)
Remuneration in Fy 19 69.60 47.98 31.00 9.08 0.59 2.91
Revenue 53 23.39
Remuneration as % of revenue 1.31 0.90 0.58 0.17 0.01 0.05
Profit Before Tax (PBT) (19.75)
Remuneration as % of PBT - - - - - -

K) The key parameters for the variable component of remuneration availed by theDirectors are considered by the Board of Directors based on the recommendations of theNomination and Remuneration Committee. The ratio of the remuneration of the highest paiddirector to that of the employees who are not directors but receive in excess of thehighest paid director during the year: None

L) Affirmation that the remuneration is as per the remuneration policy of the Company.

M) No employee's remuneration throughout the year 2018-2019 exceeded remunerationaggregating Rs. 60 Lacs or more per annum.

N) No employee's remuneration for the year 2018-2019 exceeded the remuneration of anyDirectors.

O) No employee employed for a part of the year is in receipt of remunerationaggregating Rs. 5 Lacs or more per month.

P) No employee's remuneration was in excess of the remuneration drawn by the managingdirector or whole-time director or manager and does not holds by himself or along with hisspouse and dependent children any equity shares more than 2% of the of the company.

34. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

In terms of the provisions of Regulation 34 of the Listing regulations theManagement's discussion and analysis is set out in this Annual Report as Annexure.

35. ACKNOWLEDGEMENT: your Directors wish to place on record their appreciationfor the co-operation extended by all the employees Bankers FINANCIAL Institutionsvarious State and Central Government authorities and stakeholders.

For Premco Global Limited

Ashok B. Harjani

Chairman & Managing Director

DIN-00725890

Place: Mumbai

Date: 28th May 2019

ANNEXURE 1 Form AOC-1

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014)

Statement containing salient features of the FINANCIAL statement ofventuressubsidiaries/associate companies/joint

Part "A": Subsidiaries

(Information in respect of each subsidiary to be presented with amounts in Rs. in Lacs)

Sl. No. PARTICULARS Details
1. Name of the subsidiary Premco Global Vietnam Company Limited
2. Reporting period for the subsidiary concerned if different from the holding company's reporting period January 1 2018 to December 31 2018
3. Reporting currency and Exchange rate as on the last date of the relevant VND
Financial year in the case of foreign subsidiaries 1RS.=331.20 VND
4. Share capital 540.23
5. Reserves & surplus 240.67
6. Minority Interest 132.94
7. TOTAL assets 3172.97
8. TOTAL Liabilities 3172.97
9. Investments -
10. Turnover 3657.35
11. Profit before taxation 325.44
12. Provision for taxation -
13. Profit after taxation 325.44
14. Proposed Dividend -
15. % of shareholding 85%
16. Country Vietnam

Note: Indian rupee equivalent to the given foreign currencies in the account ofsubsidiary company is based on exchange rate as on March 31 2019.

For Premco Global Limited

Ashok B. Harjani

Chairman & Managing Director 00725890

Date: 28th May 2019

Place: Mumbai

ANNEXURE 2

Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Companies Act 2013and Rule 8(2) of the Companies (Accounts) Rules 2014)

1. Details of contracts or arrangements or transactions not at arm's length basis:Premco Global Limited (the Company) has not entered into anycontract/arrangement/transaction with its related parties which are not in ordinary courseof business during Fy 2018-19.

2. Details of material contracts or arrangement or transactions at arm's length basis:(in Lacs)

Name(s) of the related party Premco Industries Ashok B. Harjani Lokesh P. Harjani Nisha P. Harjani Sonia A. Harjani
Nature of relationship Associate Company Managing Director Whole time Director Director Director
Nature of contracts / arrangements / transactions 1.Rent paid 1. Tour Advance 1. Tour Advance 1. Tour Advance 1. Loan Taken
2.Reimbursement of Expenses 2.Reimbursement of Expenses 2.Reimbursement of Expenses 2.Interest paid
3.Advance Given 3. Loan Taken 3.Advance Given
4. Loan Taken 4.Interest paid 4.Interest paid
5.Interest paid 5.Imprest 5.Imprest
Duration of the contracts / arrangements / transactions 12 Months 12 Months 12 Months 12 Months 12 Months
Salient terms of the contracts or arrangements or transactions including the value if any (in Lacs) VALUE: VALUE: VALUE: VALUE: VALUE:
1) 62.29 1) 34.90 1) 58.58 1) 53.2 1) -
2) - 2) - 2) – 2) -
3) 20.00 3) - 3) 67
4) 315.30 4) - 4) -
5) 18.03 5) 18.3 5) 20.73
Date(s) of approval by the Board if any 28.05.2019 28.05.2019 28.05.2019 28.05.2019 28.05.2019
Amount paid as advances if any NA NA NA NA NA