Royale Manor Hotels and Industries Limited
Your directors have pleasure in presenting their 26th Annual Report on thebusiness and operations of the Company together with its Audited Accounts for the yearended 31st March 2017. The Management Discussion and Analysis is also includedin this Report.
1. FINANCIAL RESULTS
The highlights of the financial results of the Company for the financial year endedMarch 31 2017 are as under:
(Amount Rs. in Lacs)
|Particulars ||2016-2017 ||2015-2016 |
|Total Income ||1836.89 ||2117.74 |
|Profit/(Loss) before || || |
|Financial Charges Depreciation and Income Tax ||459.08 ||451.64 |
|Less : Financial Charges ||(227.90) ||(196.11) |
|Less : Depreciation ||(101.42) ||(118.49) |
|Profit before Income Tax and ||129.76 ||137.04 |
|Exceptional Item || || |
|Add/(Less) : Extra Ordinary/Prior Period Item ||- ||(25.00) |
|Profit Before Income Tax ||129.76 ||112.04 |
|Provision for Income Tax ||(26.50) ||(30.56) |
|Deferred Tax Income/(Expense) ||(1.61) ||2.58 |
|Profit For the Year after || || |
|Income Tax ||101.65 ||84.06 |
|Profit Available for ||101.65 ||84.06 |
|Appropriation || || |
|Appropriation || || |
|Reserve for Replacement of FF&E (Net) ||(34.51) ||(35.46) |
|Proposed dividend ||(1.15) ||(7.02) |
|Tax on dividend ||(0.24) ||(1.43) |
|Balance of Profit/(Loss) brought forward ||1006.37 ||966.23 |
|Transfer to Capital ||(120.51) ||- |
|Redemption Reserve || || |
|Bal. carried to Balance Sheet ||951.61 ||1006.37 |
2. BRIEF DESCRIPTION OF THE COMPANY'S WORKING DURING THE YEAR/STATE OF COMPANY'SAFFAIR:
During the year under review due to ongoing trend of economic slowdown in the firsthalf of the year there was a downward trend in the demand. However towards the secondhalf of the financial year 2016-17 the demand picked up. Also in the
Ahmedabad city Hotel business became more competitive due to commencing of new Hotels.The Average Occupancy of the hotel for 2016-17 has decreased to 55.20% from 59% and theAverage Room Rates of the hotel for the year 2016-17 has been noted as Rs. 4943 ascompared to Rs. 5187 in the previous year 2015-16.
However during the financial year 2016-17 Company had been in a position to achieve aturnover of Rs. 1836.89 in comparison to Rs. 2117.74 Lacs in the previous year 2015-16.The profit before tax and profit after tax for the year under review were Rs. 129.76 Lacsand Rs. 101.65 Lacs respectively. Your directors are hopeful that with recovery in theeconomy there would be a marked improvement in the performance of the company.
The name of hotel unit of the company changed from "The Gateway Hotel UmmedAhmedabad" to "The Ummed Ahmedabad" pursuant to departure of the IndianHotels Company Limited from the operation of the Gateway Hotel Ahmedabad w.e.f. May 092016 midnight.
The hotel unit of the Company "The Ummed Ahmedabad" is an ISO 22000:2005certified hotel with the highest levels of Hygiene and Food Safety criteria. Further thehotel has established superior ambience interior decorations services and loyalclientele retained its' market leadership in the city of Ahmedabad and has placed thehotel ahead of its Competitors.
3. CHANGE IN THE NATURE OF BUSINESS:
The Company is engaged in the activities of Hotels and Restaurants.
There was no change in the nature of the business of the Company during the year underreview.
4. SHARE CAPITAL:
The paid up Equity Share Capital as on March 31 2017 was Rs. 16.93 Crores.
A) Issue of equity shares with differential rights:
During the year under review the Company has not issued any shares with differentialvoting rights.
B) Issue of sweat equity shares:
During the year under review the Company has not issued any sweat equity shares.
C) Issue of employee stock options:
During the year under review the Company has not issued any employee stock options.
D) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees:
The Company has no scheme of provision of money for purchase of its own shares byemployees or by trustees for the benefit of employees. Hence the details under rule 16 (4)of Companies (Share Capital and Debentures) Rules 2014 are not required to be disclosed.
Your directors are pleased to recommend a dividend of 6% on Optionally ConvertiblePreference Shares (OCPS) for the year 31st March 2017 aggregating to Rs. 1.15Lacs (Previous Year: Rs. 7.02 Lacs) during the year under Review.
However in view of future expansion your directors express their inability torecommend a dividend on Equity Shares of the Company for the year under review.
6. REPORT ON PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES ASSOCIATES ANDJOINT VENTURE COMPANIES:
The Company does not have Subsidiaries Associate and Joint Venture Companies. Hencedetails for the same are not required to mention here.
7. DIRECTORS AND KMP:
a) Key Managerial Personnel:
The following are the Key Managerial Personnel of the Company.
|Mr. U. Champawat ||Chairman and Managing Director |
|Mr. Yogeshkumar Jayantilal Mehta ||Chief Financial Officer |
|*Mrs. Krishna ||Company Secretary cum |
|Manthan Bhavsar ||Compliance officer. |
* Resignation as on 30.06.2017.
b) Changes in Directors and Key Managerial Personnel:
Mr. Vishwajeetsingh Champawat retire by rotation at the forthcoming Annual GeneralMeeting of the Company and being eligible offer himself for reappointment.
During the year under review Company has accepted resignation of Mr. Jainam A.Bagadiya from the post of Company Secretary cum Compliance officer and appointed Ms.Krishna M. Bhavsar as a compliance officer of the Company on 17/12/2016.
The Company has accepted resignation Mrs. Krishna M. Bhavsar from the post of CompanySecretary cum Compliance Officer 30/06/2017. The Company has accepted resignation of Mr.Ramarao Nuthakki and Mr. K. C. Jani from the directorship of the Company w.e.f. 13/02/2017and 30/09/2016 respectively.
c) Declaration by an Independent Director(s) and reappointment if any:
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
8. EXTRACT OF THE ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT 9 is annexedherewith as
9. NUMBER OF MEETINGS OF THE BOARD:
During the year the Board of Directors met Nine times (9). The details of the boardmeetings are provided in Corporate Governance Report.
10. DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors made the following statements in terms ofSection 134(3) (c) of the Companies Act 2013:
a. that in the preparation of the annual financial statements for the year ended March31 2017 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b. that such accounting policies have been selected and applied consistently andjudgment and estimates have been made that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at March 31 2017 and of theprofit of the Company for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d. that the annual financial statements have been prepared on a going concern basis
e. that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively;
f. that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
A. Statutory Auditors:
M/s. Naimish N. Shah & Co. Chartered Accountants Ahmedabad (Firm Registration No.106829W) were first appointed as statutory auditors at Company's 16thAGM held on 28th September 2007. Currently they are holding office of theauditors up to the conclusion of the 26th AGM.
As per second proviso to Section 139(2) of the Companies Act 2013 (the Act) atransition period of three years from the commencement of the Act is provided to appoint anew auditors if the existing Statutory Auditors' firm has completed two terms of fiveconsecutive years. Accordingly as per the said requirements of the Act M/s. Pranav R.Shah & Associates Chartered Accountants Ahmedabad (Firm Registration No. 0132072W)are proposed to be appointed as statutoryauditors for a period of 5 years commencing fromthe conclusion of 26th AGM till the conclusion of the 31st AGMsubject to ratification by shareholders every year as may be applicable in place of M/s.Naimish N. Shah & Co. Chartered Accountants Ahmedabad.
B. Secretarial Audit:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed CS Rupal Patel Practicing Company Secretary to undertake the Secretarial Auditof the Company. The Secretarial Audit Report is annexed herewith as "Annexure-B". Reply for qualification Remark in Secretarial Audit Report:
The company has informed to the promoters about the requirement of their respectingholding in dematerialized mode only.
12. TRANSFER TO RESERVES:
It is proposed to transfer Rs. 155.02 lacs to reserves out of the profits earned duringFY 2016-17.
13. FIXED DEPOSITS:
The Company has not accepted or renewed any deposits during the year. There are nooutstanding and overdue deposits as at 31st March 2017.
14. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.
15. RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business. There were nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
16. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant material orders passed by the Regulators /Courts which wouldimpact the going concern status of the Company and its future operations.
17. BOARD EVALUATION:
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its Audit Nomination & Remuneration and ComplianceCommittees. The manner in which the evaluation has been carried out has been explained inthe Corporate Governance Report.
18. CORPORATE SOCIAL RESPONSIBILITY:
In today's world Corporate Social Responsibility is a very important and dominantconcept for external environment. Every year 5th June is observed as the WorldEnvironment Day around the world and is of immense importance for The Ummed-AhmedabadHotel. "THE UMMED AHMEDABAD" has obtained Earth Check GoldCertification from Earth Check on International Environment body during the year2015-16 which is valid for 5 years. It is about creating wealth for all our stakeholdersembracing diversity minimizing resource consumption and reducing our greenhouse gasemissions. We provide healthy and hygienic food to our valuable customers. Customersatisfaction is our motive. This is a commitment to safeguard the health and safety of ouremployees and neighbors to support the local economy and to treat our staff fairly.
However we recognize that we will have to be innovative and draw on our key strengthin order to deliver the lasting positive outcomes that are at the core of our commitmentto sustainability of the Hotel. Even our motivated staff - are also very conscious aboutthe environment protection concept and to support environment protection concept allstaff members of Hotel "THE UMMED AHMEDABAD" are strictly participatingin No Vehicle Day by at least once in a month.
19. BUSINESS RISK MANAGEMENT:
The Company has laid down a Risk Management Policy and identified threat of such eventswhich if occurs will adversely affect either/or value to shareholders ability of companyto achieve objectives ability to implement business strategies the manner in which thecompany operates and reputation as "Risks". Further such Risks are categorizedin to Strategic Risks Operating Risks & Regulatory Risks. A detailed exercise iscarried out to identify evaluate manage and monitoring all the three types of risks.
20. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. During the year under review the company retained externalaudit firm to review its existing internal control system with a view of tighten the sameand introduce system of self-certification by all the process owners to ensure thatinternal controls over all the key business processes are operative. The scope andauthority of the Internal Audit (IA) function is defined in the Internal Audit Charter.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company and its subsidiaries. Based on thereport of internal audit function process owners undertake corrective action in theirrespective areas and thereby strengthen the controls. Significant audit observations andcorrective actions thereon are presented to the Audit Committee of the Board.
21. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Whistle Blower Policy to deal with instances offraud and mismanagement if any. The details of the Whistle Blower Policy is explained inthe Corporate Governance Report and also posted on the website of the Company.
22. EMPLOYEE RELATIONS:
Employee relations throughout the Company were harmonious. The Board wishes to place onrecord its sincere appreciation of the devoted efforts of all employees in advancing theCompany's vision and strategy to deliver good performance.
23. CORPORATE GOVERNANCE REPORT AND MANAGEMENT DISCUSSION & ANALYSIS REPORT:
The Company has been proactive in the following principles and practices of goodcorporate governance. A report in line with the requirements of Regulation 27(2) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the report onManagement Discussion and Analysis and the Corporate Governance practices followed by theCompany and the Auditors Certificate on Compliance of mandatory requirements are given asan "Annexure "C & D" respectively to this report. Your Companyis committed to the tenets of good Corporate Governance and has taken adequate steps toensure that the requirements of Corporate Governance as laid down in Regulation 27(2) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 are compliedwith.
As per 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 with the Stock Exchanges the Corporate Governance Report Management Discussion andAnalysis and the Auditor's Certificate regarding compliance of conditions of CorporateGovernance are attached separately and form part of the Annual Report.
24. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as"Annexure-E".
25. PARTICULARS OF EMPLOYEES:
None of the top ten employees of the Company drew remuneration of Rs. 10200000/- ormore per annum or Rs. 850000/- or more per month during the year as per amendment byMinistry of Corporate Affairs dated 30th June 2016. Hence no information isrequired to be furnished as required under Rule 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.
Your Directors thank the various Central and State Government DepartmentsOrganizations and Agencies for the continued help and co-operation extended by them. TheDirectors also gratefully acknowledge all stakeholders of the Company viz. customersmembers dealers vendors banks and other business partners for the excellent supportreceived from them during the year. The Directors place on record their sincereappreciation to all employees of the Company for their unstinted commitment and continuedcontribution to the Company.
| ||By Order of the Board of Directors |
|Place : Ahmedabad ||U. Champawat |
|Date : 14th August 2017 ||Chairman & Managing Director |
| ||(DIN-00294184) |