The members of
PRERNA INFRABUILD LIMITED
Your Directors have pleasure in presenting the 31 Director's Report of your Companytogether with the Audited Statement for the financial year ended 31st March 2019.
The summary of operating results for the year ended 31st March 2019 is given below:
1. FINANCIAL HIGHLIGHTS
| || ||(Rupee in Lakh) |
|Particulars ||Current Year ||Previous Year |
|Sales ||1539.12 ||801.19 |
|Other Income ||102.31 ||19.17 |
|Total Income ||1641.43 ||820.36 |
|Depreciation ||35.35 ||19.50 |
|Tax || || |
|Current Tax ||29.52 ||52.01 |
|Deferred Tax ||(4.23) ||(1.77) |
|Profit/(Loss) after Tax ||47.86 ||116.86 |
|Earnings per share (Rs.) : Basic ||0.40 ||0.97 |
|Earnings per share (Rs.) : Diluted ||0.40 ||0.97 |
2. STATE OF COMPANY'S AFFAIRS
Income from operations during the financial year ended 31 March 2019 was at Rs 1539.12Lakhs as against Rs 801.19 Lakhs representing an increase of 52.05% over the previousyear. Profit after Tax for the year under review amounted to Rs 47.86 Lakhs as against Rs116.89 Lakhs in the previous year representing decrease of 40.95%.
3. CHANGE IN THE NATURE OF BUSINESS
Your Company continues to operate in the same business segment as that of previous yearand there is no change in the nature of the business.
To conserve resources of the Company your Directors have decided to plough back theprofit and hence no dividend is recommended for the year under review.
5. TRANSFER TO RESERVES
The Board of Directors proposed to carry Nil amount to General Reserve Account and anamount of Rs. 47.86Lakhs has been retained in the profit & loss account.
6. MANAGEMENT DISCUSSION & ANALYSIS
A report on Management Discussion and Analysis as required in terms of Regulation34(2) of the Securities Exchange Board of India (Listing Obligations and DisclosureRequirement) Regulations 2015 forms part of this report and it deals with the BusinessOperations and Financial Performance Research & Development Expansion &Diversification Risk Management Marketing Strategy Safety & Environmentsignificant changes in key financial ratios etc. in Annexure-A.
7. CHANGES IN SHARE CAPITAL Authorized Share Capital
There has been no change in Authorized Share Capital of Company.
Issued Subscribed and Paid-Up Share Capital
There has been no Change in Issued Subscribed and Paid-Up Share Capital of Company.
8. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES.
The Company has One Associate Firm viz. M/S Prerna Infrabuild as on 31st March 2019.There are no subsidiary companies or joint venture companies within the meaning of Section2(87) of the Companies Act 2013 ("Act").
9. MATERIAL CHANGES BETWEEN THE DATE OF THE BOARD REPORT AND END OF FINANCIAL YEAR
There have been no material changes and commitments which have occurred between theend of the financial year of the Company and the date of the report which has affectedthe financial position of the Company.
10. MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
The information on meetings of the Board of Directors and Committees as held during thefinancial year 201819 is provided under clause 2 (b) of the Corporate Governance Report.
11. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(3) (c) of the Companies Act 2013 the Boardof Directors hereby confirms that
i. In preparation of the annual accounts the applicable accounting standards have beenfollowed and that there are no material departures.
ii. It has in the selection of the accounting policies consulted the StatutoryAuditors and has applied them consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at 31 March 2019 and of the profits of the Company for that period.
iii. It has taken proper and sufficient care for the maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities to the best ofits knowledge and ability. There are however inherent limitations which should berecognized while relying on any system of internal control and records.
iv. It has 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 operationefficiently.
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.
12. INDEPENDENT DIRECTORS MEETING
During the year under review the Independent Directors of the Company met on 06thFebruary 2019 discussed inter-alia
a. Evaluation of performance of Non-Independent Director and the Board of Directors ofthe Company as a whole.
b. Evaluation of performance of the Chairman of the Company taking into views ofexecutive and NonExecutive Directors.
c. Evolution of the quality content and timelines of flow of information between themanagement and the board that is necessary for the board to effectively and reasonablyperform its duties.
13. DIRECTORS & KEY MANAGERIAL PERSONAL Director Retiring by rotation
Mr. Vijay Chandulal Shah (holding DIN 00038062) retires by rotation under Section 152of the Companies Act 2013 and being eligible offers himself for re-appointment.
Reappointment of Independent Director.
Based on recommendation of Nomination and Remuneration Committee the Board ofDirectors propose the re-appointment of Mr. Mahendra Kantibhai Gosalia (DIN: 02279850) andMr. Kiran Hiralal Shah (DIN: 02725833) as Independent Director for a second term of fiveyears commencing form 26/09/2019. not liable to retire by rotation. Mr. MahendraKantibhai Gosalia and Mr. Kiran Hiralal Shah were appointed as an Independent Directors atthe 26th Annual General Meeting ("AGM") of the Company and held office up toSeptember 25th 2019.
Pursuant to the provisions of Section 149 of the Act the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Act along with Rules framed there under and Regulation 16(1) (b) ofthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 ("SEBI Listing Regulations"). There has been nochange in the circumstances affecting their status as independent directors of theCompany.
14. CORPORATE GOVERNANCE
The Company is committed to maintain and adhere to the Corporate Governancerequirements set out by SEBI. The Report on Corporate Governance along with requisitecertificate from M/s. Pinakin Shah & Co. Practicing Company Secretary Ahmedabad isannexed as an Annexure- E to this Report.
15. PERFORMANCE EVALUATION
Pursuant to applicable provisions of the Companies Act 2013 and the ListingRegulations 2015 the Board in consultation with its Nomination & RemunerationCommittee has formulated a framework containing inter- alia the criteria forperformance evaluation of the entire Board of the Company its Committees and IndividualDirectors including Independent Directors. The detailed information in this regard hasbeen given in the Corporate Governance Report.
The Equity shares of the Company are listed at Bombay Stock Exchange. The Company haspaid listing fees to the Stock Exchange for the year 2018-19.
Your Company has not accepted any deposit and as such no amount of principal andinterest were outstanding as at the Balance Sheet date.
18. RISK MANAGEMENT
The Company is exposed to various business risks. These risks are driven throughexternal factors like economic environment competition regulations etc. The Company haslaid down a well-defined risk management mechanism covering the risk mapping and trendanalysis risk exposure potential impact and risk mitigation process. A detailed exerciseis being carried out to identify evaluate manage and monitor business and non-businessrisks. The Audit Committee and Board periodically review the risks and suggest steps to betaken to manage/mitigate the same through a properly defined framework. During the year arisk analysis and assessment was conducted and no major risks were noticed which maythreaten the existence of the Company.
19. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company does not meet the criteria of Section 135 of Companies Act 2013 read withthe Companies (Corporate Social Responsibility Policy) Rules 2014 so there is norequirement to constitute Corporate Social Responsibility Committee for the FY 2018-19.
20. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Companies Act 2013 and implementation requirements of IndianAccounting Standard (IND-AS) Rules on accounting and Disclosure requirements which isapplicable from current year and as prescribed by Regulation 33 of the SEBI (Listingobligations and Disclosure Requirements) Regulations2015 the Audited ConsolidatedFinancial Statements are provided in this Annual Report. Pursuant to Section 129(3) of theCompanies Act 2013 a statement containing the salient features of the financialstatements of an Associate (M/S. Prerna Infrabuild) in the prescribed form AOC-1 isannexed to this Annual Report.
21. STATUTORY AUDITORS AND AUDITORS REPORT
M/s. Vijay Chauhan & Associates Chartered Accountants Ahmedabad are appointed asStatutory Auditors of the Company by the Board for a period of five years till theconclusion of the 34th Annual General Meeting of the Company to be held in the year 2022.As per the recent amendment issued by Ministry of Corporate Affairs ratification ofStatutory Auditors at every AGM is not required and hence your Directors have not proposedthe ratification of M/s. Vijay Chauhan & Associates at ensuing AGM. Auditor's Reportfor the year under review does not contain any qualifications reservations or adverseremarks.
Statutory Auditors were paid Rs. 50000 as Audit Fees during the year under review.
The statutory auditors report is annexed to this annual report. They have not reportedany incident of fraud to the Audit Committee of the Company during the year under review
22. SECRETARIAL AUDITOR
M/s Pinakin Shah & Co Practicing Company Secretary has been appointed as theSecretarial Auditor of the Company for the financial year 2018-19 as required underSection 204 of the Companies Act 2013 and Rules there under. The Secretarial Audit Reportfor the financial year ended March 31 2019 is annexed herewith marked as Annexure D tothis Report. The Secretarial Audit Report contains an adverse remark which is dealt withas under
|Remarks ||Explanation |
|1. Non Compliance of Section 138 of Companies Act 2013 ||The Company does not have Internal Audit department. |
23. COMMITTEES OF THE BOARD
Currently the Board has Three Committees:
a. Audit Committee
b. Stakeholders' Relationship Committee
c. Nomination & Remuneration committee.
A detailed note on the Board and its committees composition and compliances as perthe applicable provisions of the Act and Rules is provided under the Corporate GovernanceReport.
24. DISCLOSURE REGARDING MAINTENANCE OF COST RECORDS
The Company is not required to maintain cost records as specified by the CentralGovernment under subsection (1) of Section 148 of the Companies Act 2013.
25. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEESGIVEN AND SECURITIESPROVIDED
There were no loans & guarantees given or investments made during the financialyear ended 31st March 2019.
26. EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure-C to thisReport and also available on www.premagroup.com .
27. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1)& 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed herewith as Annexure B.
All the insurable interest of the Company including Inventories Buildings Machineryetc. is adequately insured.
29. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All related party transactions done by the Company during the financial year were atarm's length and in ordinary course of business. All related party transactions werereviewed and approved by the Audit Committee. During the financial year 2018-19 yourCompany has not entered into any material related party transaction as per the SEBIListing Regulations with any of its related parties. Disclosures pursuant to theAccounting Standards on related party transactions have been made in the notes to theFinancial Statements. As there were no related party transactions which were not in theordinary course of the business or not on arm's length basis and also since there was nomaterial related party transaction as stated above disclosure under Section 134(3) (h) inForm AOC-2 of the Companies Act 2013 is not applicable.
30. DECLARATION BY INDEPENDENT DIRECTORS
The Board of Directors of the Company hereby confirms that all the Independentdirectors duly appointed by the Company have given the declaration and they meet thecriteria of independence as provided under Section 149(6) of the Companies Act 2013.
31. FAMILIARIZATION PROGRAMME
Since all independent directors are associated with the Company for more than 5(years) the company has not conducted familiarization program for independent directors.
32. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has established a Vigil Mechanism / Whistle Blower Policy to deal withinstances of fraud and mismanagement if any. The Policy has a systematic mechanism fordirectors and employees to report concerns about unethical behavior actual or suspectedfraud or violation of the Company's Code of Conduct or policy.
33. NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors senior Management and theirRemuneration including criteria for determining qualifications positive attributesIndependence of a director. The details of the Nomination and
Remuneration Policy are covered in the Corporate Governance Report. The said policy hasalso been uploaded on the Company's website www.prernagroup.com .
34. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION
A. Conservation of Energy
Since the Company does not carry out any manufacturing activity the particularsregarding conservation of energy technology absorption and other particulars as requiredby the Companies (Accounts) Rules
2014 are not applicable.
B. Technology Absorption
There is no research and development activity carried out by the Company.
35. FOREIGN EXCHANGE EARNINGS AND OUT GO
There were no foreign exchange earnings and outgo during the year under review.
36. EQUITY CAPITAL
a) BUY BACK OF SECURITIES
The Company does not have any scheme or provision of money for the purchase of its ownshares by employees/ Directors or by trustees for the benefit of employees/ Directors.
b) SWEAT EQUITY
The Company has not issued any Sweat Equity Shares during the year under review.
c) BONUS SHARES
No Bonus Shares were issued during the year under review.
d) EMPLOYEES STOCK OPTION PLAN
The Company has not provided any Stock Option Scheme to the employees.
e) EQUITY SHARES WITH DIFFERENTIAL RIGHTS
The Company has not issued equity shares with differential rights as to dividendvoting or otherwise.
SHARES IN SUSPENSE ACCOUNT
Aggregate number of shareholders and the outstanding shares in the SuspenseAccount lying at the beginning of the year: NIL
Number of shareholders who approached issuer for transfer of shares fromSuspense Account during the year: Not Applicable
Number of shareholders to whom shares were transferred from Suspense Accountduring the year: Not Applicable
Aggregate number of shareholders and the outstanding shares in the SuspenseAccount lying at the end of the year: NIL
That the voting rights on these shares shall remain frozen till the rightfulowner of such shares claims the shares: Not Applicable
SHARES IN UNCLAIMED SUSPENSE ACCOUNT
Aggregate number of shareholders and the outstanding shares lying in theUnclaimed Suspense Account lying at the beginning of the year: NIL
Number of shareholders who approached issuer for transfer of shares from theUnclaimed Suspense Account during the year: Not Applicable
Number of shareholders to whom shares were transferred from the Unclaimed SuspenseAccount during the year: Not Applicable
Aggregate number of shareholders and the outstanding shares lying in theUnclaimed Suspense Account lying at the end of the year: NIL
37. INTERNAL FINANCIAL CONTROLS
According to Section 134(5) (e) of the Companies Act 2013 the term Internal FinancialControl (IFC) means the policies and procedures adopted by the Company for ensuring theorderly and efficient conduct of its business including adherence to Company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information. Rule 8(5) (viii) of Companies (Accounts) Rules 2014requires the information regarding adequacy of Internal Financial Controls with referenceto the financial statements to be disclosed in the Board's report. The Company has awell-placed proper and adequate IFC system which ensures that all assets are safeguardedand protected and that the transactions are authorised recorded and reported correctly.
38. INTERNAL CONTROL SYSTEM
The Company has in place adequate systems of Internal Control to ensure compliancewith policies and procedures. It is being constantly assessed and strengthened with new /revised standard operating procedures and tighter information technology controls.Internal audits of the Company are regularly carried out to review the internal controlsystems. The Audit Reports of Internal Auditor along with their recommendations andimplementation contained therein are regularly reviewed by the Audit Committee of theBoard. Internal Auditor has verified the key internal financial control by reviewing keycontrols impacting financial reporting and overall risk management procedures of theCompany and found the same satisfactory. It was placed before the Audit Committee of theCompany.
39. ANY SIGNIFICANT AND MATERIAL ORDER PASSED BY REGULATORS OR COURTS OR TRIBUNALS
No orders were passed by the Regulators or courts or Tribunals impacting the goingconcern status and Company's operation in future.
40. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has zero tolerance for Sexual harassment at workplace and has adopted apolicy on Prevention Prohibition and Redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Woman at Workplace (PreventionProhibition and Redressal) Act 2013 and no
Complaint has been received on sexual harassment during the financial year 2018-2019.The Company has also constituted an Internal Complaints Committee to consider and toredress complaints of sexual harassment.
41. DETAILS OF FRAUDS REPORTED BY THE AUDITORS
During the year under review neither the Statutory Auditor nor the secretarial auditorhave reported to the Audit Committee under Section 143(12) of the Companies Act 2013 anyinstances of fraud committed against the Company by its officers or employees.
The Directors place on record their sincere appreciation for the dedication hard workand commitment of the employees at all levels and their significant contribution to yourCompany's growth. Your company is grateful to the Distributors Dealers and Customers fortheir support and encouragement. Your Directors thank the
Banks Financial Institutions Government Departments and Shareholders and look forwardto having the same support in all our future endeavours.
For and on behalf of the Board
Vijay C Shah
Chairman and Managing Director