The Board of Directors hereby submit the report of the business and operations of yourcompany along with the Audited Financial Statements for the financial year ended 31stMarch 2019.
Rama Paper Mills Limited ("Your Company") is a leading Indian NewsprintDuplex Board Tissue manufacturing Company.
Overview of the Economy
The Global economy disappointed in terms of growth with deceleration of activity inkey emerging and developing economies like China Brazil Russia overshadowing a modestrecovery in major high income countries. The deceleration was accompanied by declines incommodity prices subdued global trade bouts of financial market volatility and weakeningcapital flows. India was a notable exception growing at 7.6% as per Central StatisticalOffice (CSO) estimates despite declines in exports. Inflation has come down howeverindustrial activity and consumption has not been buoyant. Three key transitions willinfluence the global outlook for growth pace of rebalancing in China commodityprices and monetary policy actions in the US and other major economies. For India thoughthe long term prospects for continued growth remain undiminished actual pace will dependon revival in private investment and rural consumption strengthening of bank balancesheets and continued implementation of economic reforms.
|Particulars ||2018-19 ||2017-18 |
|Turnover ||1630247683 ||1288057626 |
|Profit before Financial Charges & || || |
| ||337330456 ||(79900453) |
|Depreciation || || |
|Less: Financial Charges ||56802674 ||(112283755) |
|Less: Depreciation ||32559417 ||32194010 |
|Profit before Tax ||247968365 ||189292 |
|Add/Less: Deferred Tax || || |
| ||0 ||0 |
|Liability/Asset || || |
|Less: Provision for Tax (MAT) ||0 ||0 |
|Add: MAT Credit Entitlement ||0 ||0 |
|Profit After Tax ||247968365 ||189292 |
During the year under review your Company has earned the Net Profit of Rs.247968365 against the Net Profit of Rs.189292 in the previous year The turnover hasalso been increased to Rs. 1630247683 against the previous year turnover ofRs.1288057626.
The paid up equity capital of the Company is Rs. 196647330 divided into 9664733 equityshares of Rs. 10 each (It may also be noted that 7581400 Equity Shares of the Company arelisted on the Bombay Stock Exchange and are actively traded. Further 2083333 EquityShares of the Company are in unlisted form and the Company has applied for the listing ofits shares). The Company also has 1000000 Preference Shares of Rs.100 each. The Companyhas not come out with any issue of securities during the year 2018-19.
Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014 The Annual Return as on 31st March 2019 isavailable on your Company's website; www.ramapaper.com
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No order has been passed by the regulators or Courts or Tribunals impacting the goingconcern status and Company's operations in future.
DIVIDEND AND RESERVES
During the year under review your Company does not recommend any dividend in theabsence of profits. And also your company has not made any transfer to Reserves duringthe financial year 2018-19.
FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRALGOVERNMENT
There are no such frauds reported by auditors which are committed against the companyby officers or employees of the company.
MATERIAL CHANGES AND COMMITMENTS AFTER THE DATE OF CLOSE OF FINANCIAL YEAR 2018 19
There are no material changes and commitment affecting the financial position ofcompany after the close of financial year 2018-19 till the date of report.
DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
Your 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 Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 and the rules framed thereunder.
During the financial year 2018-19 the Company did not receive any complaints on sexualharassment and therefore no complaints remain pending as of 31st March 2019.
Your Company has not accepted any fixed deposits covered under Chapter V of the CompanyAct 2013 and as such no amount of principal or interest was outstanding on the date ofthe Balance Sheet.
During the year the Company has not issued any bonus shares.
The Properties and insurable assets and interest of your Company such as buildingsplant & machinery and stocks among others are adequately insured.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Retirement by Rotation
In accordance with the provisions of Section 152 of Companies Act 2013 Mr. GyanveerSingh Director of the Company is liable to retire by rotation at the ensuing AnnualGeneral Meeting and being eligible has offered himself for re-appointment.
Appointment / Re-appointment and Cessation of Directors & KMP
During the year under review Mr. Vijay Pal Singh has been appointed as the AdditionalDirector on the Board of the Company.
Pursuant to the provisions of Section 203 of the Act your Company has following KeyManagerial Personnel(s):
Mr. Nirdesh Agarwal - Chief Financial Officer;
Mr. Himanshu Duggal - Company Secretary;
Mr. Arun Goel - Whole Time Director;
Mr. Pramod Agarwal - Managing Director;
DECLARATION BY THE INDEPENDENT DIRECTORS
All Independent Directors has given declarations to the company confirming that theymeet the criteria of independence as laid down under Section 149 (6) of The Companies Act2013and Regulation 16(1) (b) of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.
COMPOSITION OF COMMITTEES
a) Audit Committee
The present Audit Committee of the board comprises of three members with independentdirectors forming a majority namely Mr. Alok Jain as Chairman and Mr. Gyanveer Singh Ms.Amarjeet Sandhu as members of the Committee. All the recommendations made by the AuditCommittee were accepted by the board. Further the Roles and Responsibility and otherrelated matters of Audit Committee forms an integral part of Corporate Governance Reportas part of annual report.
b) Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises of Mr. Alok Jain as chairman andMr. Gyanveer Singh Ms. Amarjeet Sandhu as members all of whom are Non- ExecutiveDirectors. All the recommendations made by the Nomination and Remuneration committee wereaccepted by the board. Further the terms of reference and other related matters ofNomination
c) Stakeholder Relationship Committee
Stakeholders Relationship Committee comprises of Ms. Amarjeet Sandhu as Chairman withMr. Alok Jain Mr. Gyanveer Singh as members of the Committee. The Committee is set up tomonitor the process of share transfer issue of fresh Share Certificates as well as reviewof redressed of investors/shareholders grievances. Further the role and responsibilityand other related matters of Stakeholders Relationship Committee forms an integral part ofCorporate Governance Report as part of annual report.
Pursuant to provisions of the Companies Act 2013 and as per applicable provisions ofSecurities And Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 a structured questionnaire was prepared after taking into considerationof the various aspects of the Board's functioning composition of the Board and itscommittees culture execution and performance of specific duties obligations andgovernance.
The performance evaluation of the independent Directors was completed. The performanceevaluation of the Chairman and non Independent Directors was carried out by theindependent Directors. The Board of Directors expressed their satisfaction with theevaluation process.
NUMBER OF BOARD MEETINGS
The Board duly met at regular intervals to discuss and decide on businessstrategies/policies and review the financial performance of the company. The notice alongwith Agenda and notes on agenda of each Board Meeting was given in writing to eachDirector.
In the Financial Year 2018-19 the Board met Eight (8) times. The interval between twomeetings was well within the period mentioned under Section 173 of Companies Act 2013 andRegulation 17(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
The details of Board Meetings held during the Financial Year 2018-19 forms part of theCorporate Governance Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes of financial statements as on31.03.2019.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 thereis no employee in the company which draws the remuneration in excess of the limits setout in the said rules.
Disclosures pertaining to remuneration and other details of directors & KMP asrequired under Section 197(12) of the Act read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are enclosed as AnnexureA to this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars relating to energy conservation technology absorption foreign exchangeearnings and outgo as required to be disclosed under Section 134 (3) (m) of the CompaniesAct 2013 read with the Rule 8(3) of the Companies (Accounts) Rules 2014 are givenhereunder:
CONSERVATION OF ENERGY
i) Steps taken or impact on conservation of energy: Energy conservation efforts areongoing activities. During the year under review further efforts were made to ensureoptimum utilization of electricity.
ii) Steps taken by the company for utilizing alternate sources of energy: Since the useof Pet Coke has been banned by the order of Supreme Court and Environmental Authoritiesthe Company has shifted its energy generation from pet coke basis to Imported coal basiswhich has resultant effect in the Cost of Energy.
iii) The Capital investment on energy conservation equipments: During the year underreview the Company has made normal routine maintenance but no capital expenditure hasbeen made.
TECHNOLOGY ABSORPTION ADAPTION & INNOVATION AND RESEARCH & DEVELOPMENT
No research & development or technical absorption or adaption & innovationtaken place in the company during the Financial Year 2018 2019 the details as perrule 8(3) of The companies (Accounts) Rules 2014 are as follows:
i) Efforts made towards technology absorption: - Nil
ii) Benefits derived like product improvement cost reduction product development orimport substitution: Nil
iii) In case of imported technology (imported during the last 3 years reckoned from thebeginning of the financial year)
a. Details of technology imported: Nil
b. Year of Import: Nil
c. Whether the technology been fully absorbed: Nil
d. Areas where absorption has not taken place and the reasons there of: Nil
iv) Expenditure incurred on Research and Development: Nil
FOREIGN EXCHANGE EARNINGS AND OUTGO
As your Company imports waste paper from the various countries owing to its highrecovery therefore the particulars relating to Foreign Exchange Earnings and Outgo aredescribed hereunder.
Foreign Exchange Earnings: NIL Foreign Exchange Outgo: NIL
Your Company has implemented all the stipulations of the Corporate Governance Practicesset out by the Securities and Exchange Board of India and as provided in SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. Separate section on Report ofCorporate Governance as stipulated under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 form part of the Annual Report.
The requisite certificate from the Company Secretary in Practice regarding complianceof conditions of Corporate Governance as stipulated under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is attached as Annexure B of theDirector's Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(5) of the Act the directors hereby confirmthat:
a) In the preparation of the Annual Accounts for the year ended 31st March 2019 theapplicable accounting standards have been followed along with proper explanations relatingto material departure.
b) Appropriate accounting policies have been selected and applied consistently andjudgments and estimates have been made that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company as at 31st March 2019 and ofthe Profit of the Company for the year ended 31st March 2019.
c) Proper and sufficient care has been taken for the maintenance of accounting recordsin accordance with the Provisions of the Companies Act 2013. They further confirm thatthere are adequate systems and controls for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities.
d) The financial statements have been prepared on a going concern basis.
e) That the Director had laid down internal financial controls to be followed byCompany and such internal Controls are adequate and were operating effectively; and
f) That the Directors had devised proper system to ensure compliance with theprovisions of all applicable laws and that such system were adequate and operatingeffectively.
MANAGEMENTS' DISCUSSION AND ANALYSIS REPORT
Managements' Discussion and Analysis Report for the year under review as stipulatedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 ispresented in a separate section forming Annexure C of the Director's Report
AUDITORS AND AUDITORS' REPORT
M/s Bajaj Arora & Co. Chartered Accountants Statutory Auditors of your Companyretire at the forthcoming Annual General Meeting and are eligible for re-appointment. Theyhave confirmed their eligibility for reappointment under the provisions of Section 139(1)of Companies Act 2013.
The Company has received a certificate from the auditors to the effect that theirappointment if made would be within the limits prescribed under the Companies Act 2013and they are not disqualified for appointment as per the provisions of section 141 of theCompanies Act 2013.
The auditor report and notes on accounts referred to in the Auditors Report isself-explanatory and there are no adverse remarks or qualification in the Report.
As per requirement of Central Government and pursuant to section148 of Companies Act2013 read with the Companies (Cost records and Audit) Rules 2014 as amended from time totime your Company has been carrying out audit of Cost records relating to the Company.
The Board of Directors on the recommendation of the Audit Committee has appointed M/s.Jain Sharma & Company Cost Accountants as the Cost Auditor of the Company for theFinancial Year 2018-19. As it requires under the Companies Act 2013 a resolution seekingmember's approval for the remuneration payable to the Cost Auditor forms part of theNotice convening Annual General Meeting.
Pursuant to the provisions of the Section 204 of the Companies Act 2013 and rules madethereunder the Board has appointed Ms. Sameer Kishore Bhatnagar Company Secretary inPractice to conduct the Secretarial Audit of the Company for the Financial Year 2018-19.The Secretarial Audit Report for the Financial Year is attached herewith as Annexure Dwhich forms integral part of this report.
The Secretarial Audit report does not contain any qualification reservation or adverseremark. Internal Auditor
As per requirements of Section 138 of Companies Act 2013 read with Rule 13 ofCompanies (Accounts) Rules 2014 The Board of Directors on the recommendation of the AuditCommittee appointed M/s. GR &Company Chartered Accountants as the Internal Auditorof the Company for the Financial Year 2018-19.
Internal Control System And Their Adequacy
Your Company has an effective internal Control and risk mitigation system which areconstantly assessed risk mitigation system which are constantly assessed and strengthenedwith new/revised standards operating procedures. The Company's internal Control System iscommensurate with its size scale and complexities of its operations.
The Audit Committee of the Board of directors actively reviews the adequacy andeffectiveness of the internal control system and suggests improvements to strengthen thesame. The company has a robust Management information system which is an integral part ofthe control mechanism.
The Audit Committee of the Board of Directors Statuary Auditors and the Business headsare periodically apprised of the internal Audit findings and Corrective actions taken.Audit plays a key role in providing assurance to the Board of Directors. Significant Auditobservation and corrective actions taken by the management are presented to AuditCommittee of the Board. To maintain its objectivity and independence the internal Auditfunction reports to the Chairman of the Audit Committee.
The risk management framework defines the risk management approach of the Company andincludes periodic review of such risks and also documentation mitigating controls andreporting mechanism of all risks.
During the year under review the senior officials of the Company performs the task ofrisk management to identify and evaluate elements of business risk. Consequently a revisedrobust Business Risk Management framework is in place. The risk management frameworkdefines the risk management approach of the Company and includes periodic review of suchrisk and also documentation mitigation control and reporting mechanism of such Risk.
Details of Subsidiary Companies Joint Ventures and Associate Company and theirFinancial Position
There is no subsidiary Associate and joint venture of the company and further thereare no companies which have become or ceased to be the subsidiary and joint venture ofthe company during the year.
LISTING OF SECURITIES
The Company's Equity Shares are listed on Bombay Stock Exchange.
PAYMENT OF LISTING FEES
The Listing fees for the year 2019-20 has not been paid by the Company. However theboard of directors of your Company undertakes to pay the same at the earliest.
RELATED PARTY TRANSACTIONS
All the related party transactions are entered on arm's length basis and are incompliance with the applicable provisions of the Act and the Listing Agreement. There areno materially significant related party transactions made by the company with PromotersDirectors or Key Managerial Personnel etc. which may have potential conflict with theinterest of the company at large. All Related Party Transactions are presented to theAudit committee. Omnibus approval is obtained for the transactions which are foreseen andrepetitive in nature. A statement of related party transactions was presented before theAudit Committee on a quarterly basis specifying the nature value and terms andconditions of the transactions. All the contracts/arrangements/transactions entered withrelated party for the year under review were on Arm's Length basis. Company has enteredinto material related party transactions during the year under review. Further disclosurein Form AOC-2 is as attached as Annexure E.
The policy on Related Party Transactions as approved by the Board of Directors has beenuploaded on the website of the Company (www.ramapaper.com).
POLICIES & DISCLOSURES
Your Company has established Vigil Mechanism' for directors and employees toreport concerns about unethical behavior actual or suspected fraud or violation of theCompany's code of conduct or ethics policy and provides safeguard against victimization ofemployees who avail the mechanism. The policy permits all the directors and employees toreport their concerns directly to the Chairman of the Audit Committee of the Company.
The Vigil Mechanism/Whistle blower Policy of the company provides that protecteddisclosures can be made by a whistle blower through an email to the Chairman of the auditcommittee. The Whistle Blower Policy can be accessed on the Company's Website(www.ramapaper.com). This disclosure also forms part of the Corporate Governance Report asper applicable provisions of Securities and Exchange Board of India (Listing Obligationsand Disclosure Requirements) Regulations 2015.
NOMINATION AND REMUNERATION POLICY
The nomination and remuneration committee has recommended to the Board:
A policy which lays down a framework in relation to remuneration of DirectorsKey Managerial Personnel and Senior Management of the Company. The details of this policyare attached as Annexure F to this report and
Further Policy for selection criteria of Directors and Senior Management andCriteria for determining qualifications positive attributes and director independence isalso attached as Annexure G to this Report. The Remuneration and Nomination Policyhas also been posted on the website of the Company (www.ramapaper.com).
CORPORATE SOCIAL RESPONSIBILITY
Pursuant to Section 135 of the Companies Act 2013 and rules made there under everycompany having net worth of Rupees five hundred crore or more or turnover of rupees onethousand crore or more or a net profit of rupees five crore or more during any financialyear shall constitute a Corporate Social Responsibility Committee of the Board.
However it is not applicable in case of your Company. Hence there is no need to formCorporate Social Responsibility Committee and Corporate Social Responsibility Policy forthe company as per the requirement of the Companies Act 2013.
FAMILIARIZATION PROGRAMME AND TRAINING OF INDEPENDENT DIRECTORS
The details of programmes for familiarization of Independent Directors with thecompany their roles and responsibilities in the company business model of the companyand other related matter are updated on the website of the Company (www.ramapaper.com).
To familiarize the new inductees as independent director with the strategy operationsand functions of our Company the executive directors make presentations to the inducteesabout the Company's organization structure finance human resources facilities and riskmanagement.
Further at the time of appointment of an independent director the Company issues aformal letter of appointment outlining his/her role function duties and responsibilitiesas a director. The Formal format of the letter of appointment is available on our website.
POLICY FOR PRESERVATION OF DOCUMENTS
In terms of applicable provisions of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 Company have incorporatedpolicy for preservation of documents as specified in the Regulation.
Policy on Materiality of Related Party Transactions
In terms of Regulation 23(1) of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 Company have incorporatedpolicy to determine materiality of Related Party Transactions as specified in theRegulation.
RISK MANAGEMENT POLICY
Enterprise Risk Management is a risk based approach to manage an enterpriseidentifying events that may affect the entity and manage risks to provide reasonableassurance regarding achievement of entity's objective. The risks identified by the Companybroadly fall into the following categories viz. strategic risks operational risksregulatory risks financial and accounting risks foreign currency and other treasuryrelated risks and information systems risks. The risk management process consists of riskidentification risk assessment risk prioritization risk treatment or mitigation riskmonitoring and documenting the new risks. Your Board has laid down a risk managementframework and policy to address the above risks. The objective of the policy is toidentify existing & emerging challenges that may adversely affect the Company andmanage risks in order to provide reasonable assurance to the various stakeholders. In theopinion of your Board none of the risks which have been identified may threaten theexistence of the Company.
Your Director states that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year underreview:-
a) Details relating to deposits covered under Chapter V of the Act.
b) Issue of the equity shares with differential rights as to dividend voting orotherwise.
c) Issue of shares (including sweat equity shares) to directors or employees of theCompany
d) Issue of Employee Stock Option Scheme to employees of the company
e) There is no subsidiary Associate and joint venture of the company and further thereare no companies which have become or ceased to be the subsidiary and joint venture ofthe company during the year.
f) No significant or material orders were passed by the regulators or courts ortribunals which impact the going concern status and Company's operations in future.
g) Purchase of or subscription for shares in the company by the employees of thecompany.
h) There is no material subsidiary of company so no policy on material subsidiary isrequired to be adopted.
Your Directors further state that:-
a) The Company has zero tolerance for sexual harassment and during the year underreview there were no complaint received and no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
b) And there is no change in the nature of business of company during the year.
Your Directors take this opportunity to place on record their appreciation for theshareholders bankers and other business associates for their forbearance understandingand support to the Company. They also wish to place on record their great appreciation ofthe commitment sense of involvement and dedication exhibited by each staff member in theoverall development growth and prosperity of the company.
|Place: Kiratpur ||BY ORDER OF THE BOARD |
|Date: 03.09.2019 ||FOR RAMA PAPER MILLS LIMITED |
| ||Sd/- ||Sd/- |
| ||PRAMOD AGARWAL ||ARUN GOEL |
| ||MANAGING DIRECTOR ||EXECUTIVE DIRECTOR |
| ||DIN: 00038838 ||DIN: 00035058 |