We are delighted to present report of directors on our business and operations for theyear ended 31st March 2019.
The Company's financial performance for the year ended 31st March 2019 is summarizedbelow:
|S. No Particulars ||2018-19 ||2017-18 |
|I Revenue from Operations (Net of Excise Duty) ||49399.04 ||4476015 |
|II Other Income ||18910 ||37519 |
|III Total Revenue (I + II) ||4958814 ||45135.34 |
|IV Expenses || || |
|Cost of materials consumed ||31085.70 ||27227.80 |
|Changes in inventories of finished goods work-in-progress and stock-intrade ||(1119.53) ||(1.86) |
|Employee benefits expense ||4337.53 ||4018.72 |
|Finance Cost ||809.93 ||771.69 |
|Depreciation and amortization expense ||1308.84 ||1196.54 |
|Other expenses: || || |
|i) Manufacturing Expenses ||586243 ||516241 |
|ii) Selling Distribution and Establishment exp. ||1020.94 ||935.72 |
|Total expenses ||43305.84 ||39311.02 |
|V Profit before exceptional and extraordinary items and tax (III-IV) ||6282.30 ||5824.32 |
|VI Exceptional items ||40.37 ||(6.65) |
|VII Profits before extraordinary items and tax (V-VI) ||6241.93 ||5830.97 |
|VIII Extraordinary items (Net of Tax Expense) ||- ||- |
|IX Profits Before Tax ||6241.93 ||5830.97 |
|X Tax Expenses || || |
|1) Current Tax ||2005.58 ||174774 |
|2) Deferred Tax ||212.85 ||281.57 |
|XI Net Profit for the period ||4023.50 ||3801.66 |
|Xll Other Comprehensive income/(loss) || || |
|Items that will not be reclassified to profit or (loss) || || |
|Re-measurement of net defined benefits plans ||(6714) ||33.81 |
|Income tax related to these items ||(2346) ||11.70 |
|Total comprehensive income ||3979.82 ||3823.77 |
|Paid-up equity share capital ||242518 ||224218 |
|Reserve excluding Revaluation Reserves as per balance sheet of previous accounting year ||22009.32 ||16892.32 |
|Earnings per equity share of H10/- each || || |
|Basic ||1743 ||17.05 |
|Diluted ||1743 ||16.86 |
OVERVIEW OF COMPANY'S FINANCIAL PERFORMANCE AND OPERATIONS
For the financial year ended 31st March 2019 Company achieved turnover of H49399.04Lakh and registered a growth of 10.36% against turnover of H4476015 Lakh for F.Y 2017-18.The Profit before Tax (PBT) for the current year is H6241.93 Lakh as against H5830.97 Lakhin previous year. The Profit after Tax for the current year is H4023.50 Lakh as againstH3801.66 Lakh in the previous year- a growth of 5.84%. The total production of the Companywas 128831 MT during the year ended 31st March 2019 against production of 115424 MT for FY2017-18.
INDIAN ACCOUNTING STANDARDS (IND AS)
The financial results for the year ended 31st March 2019 have been prepared inaccordance with Ind AS prescribed under Section 133 of the Companies Act 2013 and otherGAAP in India.
Based on the Company's performance The Board of Directors are pleased to recommenddividend of H2.25/- per equity share for the financial year ended 31st March 2019(Previous year- H2.25/- per share). The dividend payout is subject to approval of membersat the ensuing Annual General Meeting.
The dividend will be paid to members whose names appear in the Register of Members ason close of business hours on Wednesday 18th September 2019; in respect of shares held indematerialized form it will be paid to members whose names are furnished by NationalSecurities Depository Limited and Central Depository Services (India) limited asbeneficial owners as on that date.
TRANSFER TO RESERVES:
The Company do not propose to transfer any amount to the General Reserve out of theamount available for appropriations.
During the year no m ajor expan sion undertaken by the Company. Normal capitalexpenditure is being done continuously for technical and operational up gradations ofproduction facilities of the Company.
During the year Credit Rating of the Company has been kept at CARE BBB+ (under creditwatch with developing implications).
CHANGES IN THE NATURE OF BUSINESS IF ANY:
There was no change in the nature of business of the Company during the financial yearended 31st March 2019. Further there have been no material changes and commitmentsaffecting financial position of the Company from the end of financial year till the dateof this report.
SHARE CAPITAL AND LISTING OF SHARES:
During the year under review the Company has allotted 1830000 Equity Shares of theface value of H10/- each at a premium of H130.50/- per share to promoter/ promoter groupconsequent upon exercise of their rights for conversion of share warrants into equityshares. Upon allotment of these equity shares the paid up equity capital of the Companyhas increased from H224218040/- comprising of 22421804 equity shares of the face valueof H10/- each to H242518040/- comprising 24251804 equity shares of the face value ofH10/- each.
During the year under review the Company has not issued shares with differentialvoting rights and sweat equity shares.
The equity shares of the Company are listed at "Bombay Stock Exchange (BSE)"and "National Stock Exchange of India (NSE)".
DIRECTORS AND KEY MANAGERIALPERSONNEL:
The Board of Directors consists of Nine (9) Directors out of which Four (4) areExecutive Director and Five (5) are Independent Directors including One (1) WomanDirector.
Mr. Vipin Gupta retiring by rotation and being eligible offered himself forre-appointment at the ensuing Annual General Meeting.
Mr. Dalbir Singh Mr. Avtar Singh Mr. Swatantar Kumar Dewan Mr. Surinder Kumar Guptaand Mrs. Suhasini Yadav were appointed as an Independent Directors of the Company by themembers at the 34th Annual General Meeting of the Company held on 25th September 2014 fora period of five consecutive years commencing from 25th September 2014 up to 24thSeptember 2019.
As per Section 149(10) of the Companies Act 2013 an Independent Director shall holdoffice for a term of up to five consecutive years on the Board of a Company but shall beeligible for re-appointment on passing a special resolution by the Company for anotherterm up to five consecutive years on the Board of a Company. Based on recommendation ofNomination and Remuneration Committee and in terms of the provisions of Sections 149 150152 read with Schedule IV and any other applicable provisions of the Act and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board of Directors of theCompany at its meeting held on 12th August 2019 recommended for approval of the membersthe re-appointment of above Independent Directors for second term of five consecutiveyears commencing from 25th September 2019 to 24th September 2024. The above IndependentDirectors are eligible for re-appointment as an Independent Director and have offeredthemselves for re-appointment.
Independent Directors have given declarations that they meet the criteria ofindependence as prescribed under the provisions of the Companies Act 2013 read withschedules and rules issued as well as Regulation 16(1)(b) of Listing Regulations.
ANNUAL EVALUATION OF BOARD PERFORMANCE AND PERFORMANCE OF ITS COMMITTEES AND OFDIRECTORS:
In terms of applicable provisions of the Companies Act 2013 read with Rules framedthere under and provisions of Listing Regulations and on the recommendation of Nominationand Remuneration Committee the Board of Directors has put in place a process to formallyevaluate the effectiveness of the Board its Committees along with performance evaluationof each Director carried out on an annual basis. Accordingly the annual performance ofthe Board its committees and each director was carried out for the Financial Year2018-19.
Criteria for evaluation of individual Directors include aspects such as professionalqualifications prior experience especially experience relevant to the Company knowledgeand competency fulfillment of functions ability to function as a team initiativeavailability and attendance commitment contribution integrity independence andguidance/ support to management outside Board/ Committee Meetings. In addition theChairman is also evaluated on key aspects of his role including effectiveness ofleadership and ability to steer meetings impartiality ability to keep shareholders'interests in mind and effectiveness as Chairman.
Criteria for evaluation of the Committees of the Board include mandate and composition;effectiveness of the Committee; structure of the Committee; regularity and frequency ofmeetings agenda discussion and dissent recording of minutes and dissemination ofinformation; independence of the Committee from the Board; contribution to decisions ofthe Board; effectiveness of meetings and quality of relationship of the Committee with theBoard and management.
In terms of the Section 203 of the Companies Act 2013 the following are the KeyManagerial Personnel of the Company as on the date of this report.
1. Mr. Subhash Chander Garg- Chairman & Whole Time Director
2. Mr. Jatinder Singh- Co Chairman & Whole Time Director
3. Mr. Umesh Chander Garg- Managing Director
4. Mr. Vipin Gupta- CFO & Executive Director
5. Mr. Vishav Sethi- Company Secretary
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Board members are provided with necessary documents/brochures reports and internalpolicies to enable them to familiarize with the Company's procedures and practices. Thedetails of such familiarization programmes for Independent Directors are posted on thewebsite of the Company and can be accessed at http://www.ruchirapapers.com/investors.html.
The Company has not accepted any public deposits within the meaning of Section 73 and74 of the Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014(including any statutory modification(s) or re- enactment(s) for the time being in force)and as such no amount on account of principal or interest on public deposits wasoutstanding as on the date of Balance Sheet.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:
The Company does not have any Subsidiary Joint Ventures or Associate Company as on31st March 2019.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis forms an integral part of this report and givesdetails of the overall industry structure economic developments performance and state ofaffairs of your Company risk management systems and other material developments duringthe Financial Year 2018-19.
Your Company continues to be committed to good Corporate Governance aligned with goodpractices. A separate report on Corporate Governance along with Auditors' Certificate oncompliance with the Corporate Governance as stipulated in Regulation 34 of the ListingRegulations forms an integral part of this Annual Report.
HUMAN RESOURCE MANAGEMENT:
Our Employees are most valuable assets of the Company. We encourage innovationmeritocracy and the pursuit of excellence. We have setup a scalable recruitment and humanresources management process which enables us to attract and retain employees. Cordialemployee relations were maintained throughout the year in the Company. The directorsexpress their appreciation for the contribution made by employees to operations of theCompany during the year.
CORPORATE SOCIAL RESPONSIBILITY:
Your Company has constituted an independent Corporate Social Responsibility Committeepursuant to section 135 of the Companies Act 2013.
The Company's CSR philosophy is based on the belief that a successful business candevelop only by creating a prosperous society around. Reaching out to deprived communitiesis part of the Company's vision and its CSR initiatives aim at supplementing governmentendeavours' to help the citizens in the vicinity to achieve better living standards andgood quality of life. The Company has been engaging with civil society public at largethrough dissemination of its CSR initiatives.
The Company would also undertake other need based initiatives in compliance withSchedule VII of the Act.
Corporate Social Responsibility Policy:
The Company has adopted a Corporate Social Responsibility Policy as required undersection 135 of the Companies Act 2013 for the activities covered under Schedule VII ofthe Act. The CSR Policy may be accessed on the Company's website at the link: http://www.ruchirapapers.com/ investors.html.
The Annual Report on CSR activities is annexed herewith marked as Annexure I.
Your Directors continually evaluate the risks faced by the Company which could affectits business operations or threaten its existence. The Company takes appropriate riskcontainment measures and manages the same on an ongoing basis. The Company has adopted aRisk Management Policy pursuant to Section 134 of the Act.
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
The Directors have laid down internal financial controls to be followed by the Companyfor ensuring the orderly and efficient conduct of its business including adherence toCompany's policies the safeguarding of its assets the prevention and detection of fraudsand errors the accuracy and the completeness of the accounting records and the timelypreparation of reliable financial information. During the year such controls were testedand no reportable material weakness in the design or operation were observed.
EMPLOYEE STOCK OPTION SCHEME:
At present the Company is not having any Employee Stock Option Scheme.
The assets of Company are adequately insured against loss of fire riot earthquakeflood etc. and other risks which are considered necessary by the Management.
AUDITORS AND AUDITOR'S REPORT:
Pursuant to provisions of Section 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 In the 38th Annual General Meeting held on28th September 2018 M/S Subhash Sajal & Associates Chartered Accountant(Registration No. 018178N) were appointed as Statutory Auditors of the Company to holdoffice until the conclusion of 43rd Annual General Meeting at such remuneration and out ofpocket expenses as shall be fixed by the Board of Directors of the Company. The Ministryof Corporate Affairs has vide notification dated 7th May 2018 obliterated the requirementof seeking Member's ratification at every AGM on appointment of Statutory Auditors.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. The Auditor's Report for the financial year ended 31st March 2019 doesnot contain any qualification reservation or adverse remark.
Maintainance of Cost Records as specified by Central Govt. under sub section (1) ofsection 148 of Companies Act 2013 is applicable to the Company and accordingly suchaccounts and records are made and maintained by the Company.
The Board of Directors of your Company on the recommendations made by the AuditCommittee at its meeting held on 27th May 2019 has approved the reappointment of M/sSanjay Kumar Garg & Associates Cost Accountants as Cost Auditors of the Company forthe financial year 2019-20. The remuneration proposed to be paid to the Cost Auditorsubject to your ratification at the ensuing Annual General Meeting is H70000 (SeventyThousand Only) excluding taxes and out of pocket expenses if any. The appointment of theCost Auditor has been intimated to the Central Government.
The Cost Audit report for the Financial Year 2017-18 has been filed by the CostAuditors with the Ministry of Corporate Affairs Govt. of India. Whereas Cost Audit Reportfor the Financial Year 2018-19 will be submitted by Cost-Auditors with Ministry ofCorporate Affairs with in prescribed time.
The Board has re-appointed M/s. R.K. Bhalla & Associates Practicing CompanySecretary to conduct Secretarial Audit for the financial year 2018-19. The SecretarialAudit Report for the financial year ended March 31st 2019 is annexed herewith marked asAnnexure II to this report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.
INVESTOR EDUCATION AND PROTECTION FUND:
During the year the Company was not required to transfer any amount to the InvestorEducation and Protection Fund.
Pursuant to provisions of Investor Education and Protection Fund (Uploading ofInformation regarding unpaid and unclaimed amounts lying with Companies) Rules 2012 theCompany has uploaded details of unpaid and unclaimed amounts lying as on 28.09.2018 (dateof last Annual General Meeting) on Company's website and as also filed with Ministry ofCorporate Affairs.
Furthermore in terms of Section 124(6) of the Companies Act 2013 read with Rule 6 ofthe Investor Education and Protection Fund Authority (Accounting Audit Transfer andRefund) Rules 2016 (as amended from time to time) shares on which dividend remainsunpaid or unclaimed for a period of seven consecutive years or more shall be credited tothe Demat Account of Investor Education and Protection Fund Authority (IEPFA) within aperiod of thirty days of such shares becoming due to be so transferred. Upon transfer ofsuch shares all benefits if any accruing on such shares shall also be credited to suchDemat Account and the voting rights on such shares shall remain frozen
till the rightful owner claims the shares. Shares which are transferred to the DematAccount of IEPFA can be claimed back by the shareholder from IEPFA by following theprocedure prescribed under the aforesaid rules. Therefore it is in the interest of theshareholders to regularly claim the dividends declared by the Company.
The CSR Committee comprises Mr. Surinder Kumar Gupta (Chairman) Mr. Umesh ChanderGarg Mr. Subhash Chander Garg Mr. Jatinder Singh and Mr. Vipin Gupta as members.
The Audit Committee comprises Mr. Dalbir Singh (Chairman) Mr. Surinder Kumar GuptaMr. Avtar Singh and Mr. Jatinder Singh as members. All the recommendations made by theAudit Committee were accepted by the Board.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises Mr. Dalbir Singh (Chairman) Mr.Surinder Kumar Gupta and Mr. Avtar Singh as members.
The Company's Policy relating to appointment of Directors payment of ManagerialRemuneration Directors' qualifications positive attributes independence of Directorsand other related matters as provided under Section 178(3) of the Companies Act 2013 isfurnished as Annexure III and forms part of this Report.
Whistle Blower Policy/Vigil Mechanism
The Company has a Vigil Mechanism and Whistle Blower Policy under which the employeesare free to report violations of applicable laws regulations and the code report to theChairman of the Audit Committee. During the year under review no employee was deniedaccess to the Audit Committee. The Policy on vigil mechanism and whistle blower policy maybe accessed on Company's website at the link http://www. ruchirapapers.com/investors.html. of conduct. The reportable matters may be disclosed to the Vigilance andEthics Officer who operates under the supervision of the Audit Committee.
Meetings of the Board
Four meetings of the Board of Directors were held during the year. For further detailsplease refer to report on Corporate Governance of this Annual Report. Further a separatemeeting of the Independent Directors of the Company was also held on 19th March 2019where at the prescribed items enumerated under Schedule IV to the Companies Act 2013 andregulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015were discussed.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
A statement giving details of Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo as stipulated under Section 134 of the Companies Act 2013read with the Companies (Accounts) Rules 2014 is set out herewith as Annexure IV to thisReport.
Extract of Annual Return
The details forming part of the extract of the Annual Return as on 31st March 2019 inform MGT-9 in accordance with Section 92(3) of the Companies Act 2013 read with Companies(Management and Administration) Rules 2014 are set out herewith as Annexure V to thisReport. The same is available on Company's website at http://www.ruchirapapers.com/investors.html.
Secretarial Standards of ICSI
The Company is in compliance with the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India and approved by the Central Government.
RELATED PARTY TRANSACTIONS:
All Related Party Transactions that were entered into during the year were on an arm'slength basis and were in compliance with applicable provisions of the Act and the ListingRegulations. The Board of Directors at their meeting held on 12.02.2018 pursuant torecommendation of Audit Committee accorded its approval for increase in maximum aggregatevalue of material related party transactions and to enter fresh agreement with relatedparties. The same was further approved by Shareholders' of the Company through PostalBallot on dated 22.03.2018. The approval was granted with the condition thattransaction(s) shall be done at arm's length basis.
A statement of all Related Party Transactions is placed before the Audit Committee forits review on quarterly basis specifying the nature value and terms and conditions ofthe transactions. The particulars of every contract and arrangement entered into by theCompany with related parties referred to in sub-section (1) of Section 188 of theCompanies Act 2013 are disclosed in Form No. AOC-2 in Annexure VI and were at arm'slength price.
The details of the related party transactions as per IND AS 24 are set out in Note- 28to the Financial Statements forming part of this report. The Policy on materiality ofrelated party transactions and dealing with related party transactions as approved by theBoard may be accessed on the Company's website at the Link: http://www.ruchirapapers.com/investors.html.
DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL ANDPARTICULAR OF EMPLOYEES:
Number of Employees as on March 31 2019 was 1007.
The remuneration paid to the Directors is in accordance with the Nomination andRemuneration Policy formulated in accordance with Section 178 of the Companies Act 2013and Regulation 19 of the Listing Regulations (Including any statutory modification(s) orre-enactment(s) for the time being in force).
The information required pursuant to Section 197(12) read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of theDirectors/employees of the Company is set out in Annexure-VII to this report.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
a) Details relating particulars of Loans given Investment made Guarantee given andSecurities provided u/s 186.
b) No significant or material orders were passed by the Regulators or Courts ofTribunals which impact the going concern status and Company's operations in future.
Your Directors further state that during the year under review there was no case filedpursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT:
The pursuant to statement of the Directors' Responsibility on Annual Accounts of theCompany referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act2013 the Board of Directors to the best of their knowledge and ability confirm:
a. that in preparation of annual accounts the applicable accounting standards andSchedule III of the Companies Act 2013 had been followed along with proper explanationrelating to material departures (if any);
b. that 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 at the end of the financial year and ofprofits and loss of the Company for that period;
c. that the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingassets of the Company and for preventing and detecting fraud and other irregularities;
d. that the directors had prepared Annual Accounts on going concern basis;
e. that the directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f. that the directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
Your Directors wish to express their grateful appreciation for the cooperation andcontinued support received from Bankers Financial Institutions Government agenciesShareholders Vendors Customers and Society at large. Your directors also take on recordtheir appreciation for contribution and hard work of Executives Employees and Workers.
| ||For and on behalf of the Board |
|Date: 12th August 2019 ||Subhash Chander Garg |
|Place: Kala-Amb ||(Chairman & Whole Time Director) |