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Restile Ceramics Ltd.

BSE: 515085 Sector: Consumer
NSE: N.A. ISIN Code: INE298E01022
BSE 00:00 | 25 Sep 1.89 -0.03
(-1.56%)
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NSE 05:30 | 01 Jan Restile Ceramics Ltd
OPEN 2.11
PREVIOUS CLOSE 1.92
VOLUME 7887
52-Week high 3.41
52-Week low 1.60
P/E
Mkt Cap.(Rs cr) 19
Buy Price 1.83
Buy Qty 445.00
Sell Price 1.89
Sell Qty 13952.00
OPEN 2.11
CLOSE 1.92
VOLUME 7887
52-Week high 3.41
52-Week low 1.60
P/E
Mkt Cap.(Rs cr) 19
Buy Price 1.83
Buy Qty 445.00
Sell Price 1.89
Sell Qty 13952.00

Restile Ceramics Ltd. (RESTILECERAMICS) - Director Report

Company director report

TO THE MEMBERS

The Directors are pleased to present the 33nd Annual Report of the Companytogether with its Audited Financial Statements for the year ended March 31 2019.

Financial Results

र: Lakhs
Particulars 2018–19 2017–18
Revenue From Operations 205.95 66.25
Other Income 87.79 42.53
EBITDA (13.75) (31.68)
Interest and Financial charges 0.03 0.17
Depreciation 572.16 625.95
Profit/(Loss) before taxes and Exceptional Items (585.94) (657.80)
Exceptional Items (4.82) 349.98
Provision for taxes - (6.65)
Profit / (Loss) for the Year (590.76) (314.47)

Company Performance

The Company achieved a turnover of 205.95 Lakhs for the period ended March 31 2019;increased by 139.70 Lakhs (210.87%) as compared to previous year.

The total expenditure for the period ended March 31 2019 stood at 879.68 Lakhsincreased by 113.11 Lakhs (14.76%) as compared to previous year.

The Loss (EBITDA) before Depreciation Finance Cost and Tax for the year ended March31 2019 amounted to 13.75 Lakhs decreased by 17.93 Lakhs (56.59%) as compared toprevious year.

The Loss before tax and Exceptional item(s) for the year ended March 31 2019 amountedto 585.94 Lakhs decreased by `71.86 Lakhs (10.92%) as compared to previous year.

The tax expense for the year ended March 31 2019 was (zero ) 0 Lakhs. The Loss aftertax for the year ended March 31 2019 stood at 590.76 Lakhs as against a loss of 314.47Lakhs of the previous year. No transfer was made to General reserve during the year endedMarch 31 2019.

Dividends

Your directors regret to state that in view of the continuous losses suffered by thecompany no dividend has been recommended for the year ended March 31 2019.

Share Capital

The Authorised Share Capital of the Company as on date of Balance Sheet is1000000000/- divided into 100000000 equity shares of Rs.10/- each.

The paid up share capital of the company as on date of balance sheet is Rs.982792390/- divided into 98279239 equity shares of Rs.10/- each.

During the year under review the company has neither increased the Authorised sharecapital nor allotted any equity shares.

Borrowings

The Company’s borrowings as at March 31 2019 stood at Rs.3923. 34 lakhs asagainst Rs.3921.74 lakhs as at March 31 2018.

Fixed Deposits

The Company has not accepted any fixed deposits within the meaning of section 73 ofthe companies Act 2013 Read with the Companies (Acceptance of Deposits) Rules 2014during the period under review.

Information about Subsidiary / Joint Ventures

Your Company does not have any subsidiary or Joint Ventures nor is a subsidiary orJoint Venture to any other Company.

Particulars of related party contracts and other arrangements under section 188 of thecompany

All Related Party Transactions that were entered into during the financial year were onan arm’s length basis in the ordinary course of business and were in compliance withthe applicable provisions of the Act and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. There were no materially significant Related PartyTransactions made by the Company during the year that would have required Shareholderapproval under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.

All Related Party Transactions are placed before the Audit Committee for approval. Astatement containing the details of all Related Party Transactions has been placed beforethe Audit Committee for its review on a quarterly basis.

The Policy on materiality of related party transactions and on dealing with relatedparty transactions as approved by the Board may be accessed on Company’s website.There were transactions during the year which are given in Form AOC 2 as an annexure tothis report.

Implementation of Risk Policy

Regulation 21 of SEBI (LODR) requires the top 100 Companies to constitute a RiskManagement Committee. This regulation is not applicable to your company. The companyhowever has appointed an internal auditor whose terms of reference among other thingsinclude the evaluation of Internal Control Systems and inform the management of probablelapses. The Audit Committee and the Board of directors have from time to time alsoidentified the risks and opportunities. This practice seeks to create transparencyminimize adverse impact on business objective and enhance the Company’s competitiveadvantage. The two key components of risks are the probability (likelihood) of occurrenceand the impact (consequence) of occurrence if the risk occurs. Risk is analyzed bycombining estimates of probability and impact in the context of existing control measures.

The Company has laid down procedures to inform Audit Committee as well as the Board ofDirectors about the risk assessment and management procedures and status. These proceduresare periodically reviewed to ensure that the executive management monitors and controlsrisks.

Directors and Key Managerial Personnel (KMP)

The Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of Independence as prescribed both under the Act and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

Mr.Viren Rathod Managing Director Tribhuvan Simh Rathod Chief Financial Officer andMs. Swinky Bathla Company Secretary are designated as Key Managerial Personnel of theCompany pursuant to Section 203 of the Companies Act 2013.

Board and Committee Meetings

The Board of directors has met 6 (Six) times during the year to review and consider thequarterly financials of the Company amongst other things. Details of the composition ofthe Board and its Committees and of the meetings held and attendance of the Directors atsuch Meetings are provided in the Corporate Governance Report. The intervening gapbetween the Meetings was with- in the period prescribed under the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Directors’ Responsibility Statement

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors including audit of internal financial controls over financialreporting by the statutory auditors and the reviews performed by Management and therelevant Board Committees including the Audit Committee the Board is of the opinion thatthe Company’s internal financial controls were adequate and effective during thefinancial year 2018-19.

Accordingly pursuant to Section 134(3) (c) and 134(5) of the Act the Board ofDirectors to the best of their knowledge and ability confirm that:–i. in thepreparation of the annual accounts the applicable accounting standards have been followedand that there are no material departures; ii. they have selected such accountingpolicies and applied them consistently made judgments and estimates that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company atthe end of the financial year March 31 2019 and of the profit or loss of the Company forthat period; iii. they have taken proper and sufficient care for maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;iv. they had prepared the annual accounts on a going concern basis; v. theyhave laid down the internal financial controls to be followed by the Company and that suchinternal financial controls are adequate and are operating effectively; vi. theyhave devised proper systems to ensure compliance with the provisions of all applicablelaws and that such systems were adequate and operating effectively.

Internal Controls and Systems

The company has an internal control system commensurate with size and scale andcomplexity of its operations.

Vigil Mechanism/Whistle Blower Policy

The Company has adopted a Whistle Blower Policy to provide a mechanism for theDirectors and employees to report genuine concerns about any unethical behavior actual orsuspected fraud or violation of the Company’s Code of Conduct. The provisions of thispolicy are in line with the provisions of Section 177 (9) of the Act and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015/Listing Agreement.

Significant and Material Orders passed by the Regulators

During the year under review no significant and material orders were passed by theregulators or courts or tribunals impacting the going concern status and future operationof the Company.

Corporate Social Responsibly

The company has incurred loss in the current year and past 3 years also. Even thoughCorporate Social Responsibility is not mandatory your Company is intrinsically associatedwith the society and environment by upholding its businesses with transparency andcommitment.

Remuneration Policy

The Company had adopted a Remuneration Policy for the Directors Key Managerial Personsand other employees pursuant to the provisions of the Act.

The key principles governing the Company’s Remuneration Policy are as follows:

Remuneration for Independent Directors and Non-Independent Non-Executive Directors

• Independent Directors (ID) and Non-Independent Non-Executive Directors (NINE)may be paid sitting fees for attending the meetings of the Board and of Committees ofwhich they may be members as recommended by the NRC and approved by the Board.

• Overall remuneration should be reasonable and sufficient to attract retain andmotivate Directors aligned to the requirements of the company; taking into considerationthe challenges faced by the Company and its future growth imperatives.

• Remuneration paid should be refiective of the size of the Company complexity ofthe sector/ industry/Company’s operations and the Company’s capacity to pay theremuneration and be consistent with recognized best practices.

• The aggregate commission if any payable to all the NEDs and IDs will berecommended by the NRC to the Board based on Company performance profits return toinvestors shareholder value creation and any other significant qualitative parameters asmay be decided by the Board. The NRC will recommend to the Board the quantum of commissionfor each Director based upon the outcome of the evaluation process which is driven byvarious factors including attendance and time spent in the Board and Committee Meetingsindividual contributions at the meetings and contributions made by Directors other than inmeetings.

• The remuneration payable to Directors shall be inclusive of any remunerationpayable for services rendered in any other capacity unless the services rendered are of aprofessional nature and the NRC is of the opinion that the Director possesses requisitequalification for the practice of the profession.

Remuneration for Managing Director (MD)/ Key Managerial Personnel (KMP)/ rest of theEmployees

• The extent of overall remuneration should be sufficient to attract and retaintalented and qualified individuals suitable for every role. Hence remuneration should bemarket competitive driven by the role played by the individual refiective of the size ofthe Company complexity of the sector/ industry/ Company’s operations and theCompany’s capacity to pay consistent with recognized best practices and aligned toany regulatory requirements.

• Basic/ fixed salary is provided to all employees to ensure that there is asteady income in line with their skills and experience. In addition the Company providesemployees with certain perquisites allowances and benefits to enable a certain level oflifestyle and to offer scope for savings. The Company provides retirement benefits asapplicable.

It is affirmed that the remuneration paid to Directors KMP and all other employees isas per the Remuneration Policy of the Company.

Evaluation of Board of Directors

The Board of Directors of the Company presently comprises (8) Non-Executive Directorsand one Executive Director viz. the Managing Director. The Directors appointed on theBoard are from diverse fields relevant to the Company’s business having longstand-ing experience and expertise in their respective fields. They have considerable experiencein managing large corporate and have been in public life for decades.

Non-Executive Directors add substantial value through the deliberations at the meetingsof the Board and Committees thereof. To safeguard the interests of the investors theyalso play a control role. In important Committees of the Board such as Audit CommitteeNomination & Remuneration Committee Stakeholders Relationship Committee etc. theDirectors play an important role by contributing to the deliberations of the CommitteeMeetings. Besides contributing at the meetings of the Board and Committees theNon-Executive Directors also have off-line deliberations with the Management of theCompany and add value through such deliberations.

In a separate meeting of Independent Directors performance of Non-IndependentDirectors performance of the Board as a whole and performance of the Chairman wasevaluated taking into account the views of executive and non-executive directors.

Listing

The Equity Shares of your Company are listed at BSE Limited Mumbai.

The Listing fees to these Stock Exchanges and custodian fees to NSDL and CDSL have beenpaid by the Company for the financial year 2018-19.

Auditors

i. Statutory Auditors:

M/s.R. Sundararajan & Associates Chartered Accountants (Firm Registration No.08282S Who are statutory auditors of the company to hold office up to the forth comingAnnual General Meeting and are eligible for re-appointment is recommended by the Board forre-appointment as statutory auditors to hold office till conclusion of 38rd Annual GeneralMeeting.

Pursuant to the provisions of Sec.139 of the Companies Act 2013 and the rules framedthere-under the company has obtained written confirmation from M/s.R. Sundararajan &Associates Chartered Accountants (Firm Registration No. 08282S that their appointment ifmade would be in conformity with limits specified in the said section.

Regarding the Qualifications/Comments of auditors in their report the directors wishto state:

In order to make companies business viable the company has drawn plans to merge Twoassociate companies (Atreya Finance Private Ltd and Bell Granito Ceramica Ltd) with thecompany. For this purpose a modified draft merger scheme was submitted to BIFR and waspending before BIFR. However as the BIFR stands dissolved the Company plans to restart theMerger Process afresh before the NCLT.

Further in respect of qualifications/Comments of the auditor company had sought relieffrom BIFR in the modified draft rehabilitation scheme submitted which shall be resubmittedto NCLT (with necessary modifications). Once the approval of said Scheme is received allthe qualifications/comments of auditors in their report will get cleared.

Regarding auditors comment under key audit matters company has since paid income taxdue of Rs.2.7 lakhs and major portion of Sales Tax of Rs.10.07 lakhs out of 20.07 Lakhs. ii.Cost Audit As per the provisions of Section 148(1) of the Companies Act 2013 Readwith Companies (Cost Records and Audit) Rules 2014 as amended from time to time themaintenance of cost records and the requirement of audit of cost records in accordancewith the applicable rules are not applicable to the company. iii. Secretarial AuditPursuant to the provisions of section 204 of the Companies Act 2013 and rules madethereunder the company has appointed M/s N Madhavi Practicing Company Secretary (C.PNo.11732) to undertake the Secretarial Audit of the company. The secretarial auditreport is included as Annexure – B and forms an integral part of this report.

Corporate Governance Report Management Discussion & Analysis Report

As required under SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the report on Management Discussion & Analysis Corporate Governance as well asthe Auditor’s certificate on the compliance of Corporate Governance thereon areattached and form part of the Annual Report.

Conservation of Energy Technology Transfer and Foreign Exchange Earnings and Outgo

Particulars pursuant to the provisions of section 134(3)(m) of the Act read with theCompanies (Accounts) Rules 2014 is furnished in the Annexure to this report.

Particulars of Employees & Remuneration

The information required under section 197(12) of the Act read with rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is furnishedin the Annexure 3 to this report.

The information required under Rule 5 (2) and (3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 in the Annexure forming part of theReport. In terms of the first proviso to section 136 of the Act the Report and accountsare being sent to the shareholders excluding the aforesaid Annexure. Any shareholderinterested in obtaining the same may write to the Company Secretary at the RegisteredOffice of the Company.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013

The Company has zero tolerance for sexual harassment at its workplace and has adopted aPolicy on prevention prohibition and redressal of sexual harassment at the workplace inline with the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules thereunder for prevention and redressalof complaints of sexual harassment at workplace.

During the Year under review the company has not received any complaints on sexualharassment.

Extract of Annual return

The details forming part of the extract of the annual return in form MGT-9 as requiredunder section 92 of the companies Act 2013 is included in this Report as Annexure –Aand forms as integral part of this Report.

Appreciation

Your director’s wish to place on record their appreciation for the contributionmade by the employees at all levels but of whose hard work and support your company’sachievements would not have been possible. Your directors also wish to thank itscustomers dealers agents suppliers investors and bankers and various State and CentralGovernment Agencies. The Directors also take this opportunity to thank the shareholdersfor their continued confidence reposed in the Management of the company.

By Order of the Board of Directors
Sd/- Sd/-
Place: Mumbai Viren Rathod N S Ramachandran
Date: 10.8.19 (DIN 03407158) (DIN 00089348)
Managing Director Director

ANNEXURE TO THE DIRECTORS REPORT

Conservation of Energy Technology Transfer and Foreign Exchange Earnings and outgo

The Information under Section 134(3) (m) of the Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 for the year ended March 31 2019 is givenhere below and forms part of the Directors Report.

Conservation of Energy

In line with the Company’s Commitment towards conservation of energy the companyis putting efforts to conserve energy by means of minimal consumption of power. TotalUnits of power consumed during the year was 77538 units amounting to Rs.9.20 Lacs(2017:18- 94737.50 units amounting to Rs. 13.92 Lacs). During the year there was noproduction and hence the Gas consumption is Nil.

Technology Absorption

As there are no productions/operations during the year 2018-19 nothing much happenedin the areas of Technology absorption new product development cost reduction and qualityimprovement.

2018-19

2017-18

Foreign Exchange Earnings and Outgo

(Rs. in Lakhs)

(Rs. in Lakhs)

Foreign Exchange Earnings Nil Nil
Foreign Exchange outgo Nil Nil

Annexure to The Director’s Report

As per the last GDP growth estimates there is growth in Indian economy in theFinancial Year 2018-19 compared to Financial Year 2017- 2018. Reduced infiation stableRupee improved purchasing power and higher capital infiows supported by the governmentpolicy reforms in the infrastructure sector have already put India on an acceleratinggrowth track and improved the business outlook.

Management Discussion and Analysis of Operating Results and Financial Performance

1. The paid up equity share capital as at March31 2019 stood at Rs. 98.27 crore.During the year under review the company has not issued shares with differential votingrights nor has granted any stock options or sweat equity. As on March 31 2019 none of thedirectors of the company hold instruments convertible into equity shares of the company.

2. Net Revenue from operations during the year was Rs. 205.95 lacs as against Rs.66.25 Lacs during the previous year. During the year there was no production and therevenue was generated out of sale of materials from Stock and from traded goods.

3. On the Expenditure part there has been decrease in total expenditure comparedto previous year. The Following tabular statement depicts the increase/ (decrease) ofvarious types of expenditure

( र:. in Lakhs)

Sl.No Nature of Expenditure

2018-19

2017-18

Increase/ (Decrease)

1. Raw Material Consumption (including 174.68 57.67 117.01
Movement in Finished Goods Stock)
2. Employee Expenses 35.47 35.83 (0.36)
3. Finance Costs 0.03 0.17 (0.14)
4. Other Expenses 97.34 46.77 50.57
5. Depreciation and amortization 572.10 625.95 (53.79)
6. Excise Duty on Sale of Goods 0 0.18 (0.18)
Total 879.62 766.57 113.11

It is clear from the above statement that all the expenditures except consumption ofmaterials and other expenses show a decreasing trend compared to previous year.

4. Internal Controls and systems are reviewed periodically and corrective actionsare taken upon requirement.

5. Opportunities and challenges: No Production during the year. During the yearmajor portion of old materials which were lying in stock for long period were sold. Thecompany has also purchased material from M/s Bell Granito Ceramica Limited an AssociateCompany which has resulted in extra revenue on account of sale of these products in theAndhra and Telangana region.

6. Threats: Since the vitrified market enjoys consistent growth and assuredreturns companies in the organized and unorganized sector are expected to come up withlatest technology which may result in pressure on the realizations. However theuniqueness of the products will help us in garnering the Project and Industrial sectorwhich help in overcoming the competition

7. Risks and Concerns:

The company specific risks remain by and large the same as enumerated last year. TheCompany is consuming LPG which is a petroleum product for firing the tiles. The prices ofpetroleum products depend upon international market and subject to volatility. Some of thecompetitors who have the facilities of natural gas tax incentives etc. are dominating themarket. There may be a threat from some of the larger capacity players who have variedrange of products effects and colors to dominate market presence.

8. Human Resource & Industrial Relations:

Majority of Employees were settled in the earlier years. The relationship with thebalance employees has been fairly cordial.

9. The company had in earlier year initiated the process of Shifting of registeredOffice from Telangana to Gujarat for better management of affairs of the company. Thecompany has received the necessary orders from ROC for the same and the present registeredoffice of the company is situated in the state of Gujarat.

10. Cautionary statement:

Statements in this Directors report & management discussion and Analysis describingthe company’s objectives projections estimates expectations or predictions may be"forward-looking statements" within the meaning of applicable securities lawsand regulations. Actual results could differ materially from those expressed or implied.Important factors that could impact are raw material availability and its prices cyclicaldemand and pricing in the company’s principle market changes in governmentregulations tax regimes economic developments within India and countries in which thecompany conducts business.

FORM NO. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule8(2) of the Companies (Accounts) Rules 2014)

Form for disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub-section (1) of section 188 of theCompanies Act 2013 including certain arms length transactions under third proviso thereto

S.No. Particulars
1. Details of contracts or arrangements or transactions not at arm’s length basis:
(a) Name(s) of the related party and nature of relationship
(b) Nature of contracts/arrangements/transactions:
(c) Duration of the contracts / arrangements/transactions:
(d) Salient terms of the contracts or arrangements or transactions including the value if any: NIL
(e) Justification for entering into such contracts or arrangements or transactions
(f) Date(s) of approval by the Board:
(g) Amount paid as advances if any:
(h) Date on which the special resolution was passed in general meeting as required under first proviso to section 188:
2. Details of material contracts or arrangement or transactions at arm’s length basis:
(a) Name(s) of the related party and nature of relationship: Details attached in
(b) Nature of contracts/arrangements/transactions: Annexure
(c) Duration of the contracts / arrangements/transactions:
(d) Salient terms of the contracts or arrangements or transactions including the value if any:
(e) Date(s) of approval by the Board if any:
(f) Amount paid as advances if any:

 

For and on behalf of the Board of Directors
Sd/- Sd/-
Place: Mumbai Viren Rathod N S Ramachandran
Date: 10.8.19 (DIN 03407158) (DIN 00089348)
Managing Director Director

ANNEXURE

S.No. Name of the Related Party

Nature of Transaction

Duration of Transaction

Salient terms of the transaction including the value if any (in Lakhs)

Date of approval by the board if any

1 Bell Granito Ceramica Limited Purchases Continual 18.65 26-05-2018
2 Bell Granito Ceramica Limited Sales Continual 179.86 26-05-2018

 

For and on behalf of the Board of Directors
Sd/- Sd/-
Place: Mumbai Viren Rathod N S Ramachandran
Date: 10.8.19 (DIN 03407158) (DIN 00089348)
Managing Director Director

.