Your Directors are pleased to present the 16th Annual Report of your company on theoperations and performance along with the Audited Financial Statements for the year endedon 31st March 2019.
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|Particulars || |
March 31 2019
March 31 2018
|Total Revenues || |
|Total Expenditure || |
|Profit before interest depreciation extraordinary item and tax || |
|Depreciation and Interest || |
|Profit / (Loss) before exceptional extraordinary item and tax || |
|Exceptional & Extraordinary item || |
|Profit / (Loss) before tax || |
|Tax Expense / Deferred tax || |
|Net Profit / (Loss) for the year || |
|Total Comprehensive income || |
|Profit / (Loss) Brought forward from last year || |
|Balance Carried forward || |
STATE OF COMPANY'S AFFAIRS / PERFORMANCE OVERVIEW
During the year under review Total Revenue from operation has been increased fromRs448.79 Crores' to Rs 575.69 Crores' as compared to previous year's turnover. Company hasregistered a net Loss of Rs 21.60 Crores in comparison of profit of Rs 42.39 Crores duringprevious year. During the year under review Company has been regularly paying all theinstalment as per the terms of settlement with banks and financial institution
Due to high accumulated loss your Directors have not recommended dividend for thefinancial year 2018-19.
The company is engaged in manufacture of sponge iron ferro alloys and power. Companyis generating power on account of waste heat recovery system resulting economic price.Company is having its power plant of 40 MW. Power generated is used for captiveconsumption. There has been no change in the nature of business of the Company.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
The company does not have holding or subsidiary companies during the year and no othercompany has become holding / subsidiary/ joint venture / associate. The Company is anAssociate Company of M/s Shah Alloys Limited as it is holding more than 20% of the EquityShare Capital in the Company as a Promoter Company.
|Name of Director or KMP ||Designation ||Appointment/Resignation /Cessation ||Date |
|Mr. Niraj Jain ||Company Secretary ||Resignation ||03/01/2019 |
|Mr. Manish Daulani ||Company Secretary ||Appointment ||04/01/2019 |
|Mr. Jethalal M. Shah ||Non-Executive Independent Director ||Cessation ||13/01/2019 |
| || ||(Due to Sudden Demise) || |
MEETINGS OF THE BOARD
During the year under review total four meetings of Board of Directors were held onthe following dates 28/05/2018 11/08/2018 14/11/2018 13/02/2019. Details of meetingsare given in the Corporate Governance Report annexed herewith and forms part of thisreport. The intervening gap between the Meetings was within the period prescribed underthe Companies Act 2013 and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declarations from each Independent Director of theCompany confirming that he/she met with the criteria of independence as laid out insub-section (6) of Section 149 of the Companies Act 2013 and under Regulation 16(1)(B) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
A diverse Board enables efficient functioning through differences in perspective andskill and also fosters differentiated thought processes at the back of varied industrialand management expertise gender knowledge and geographical background. The Companyfollows diverse Board structure.
As per the provisions of the Companies Act 2013 and SEBI (Listing Obligation andDisclosure Requirements) Regulations 2015 the formal annual evaluation was carried outfor the Board's own performance its committee & Individual directors. The manner anddetail in which evaluation was carried out is stated in the Corporate Governance Reportwhich is annexed and forms a part of this report.
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY
The details in respect of internal financial control and their adequacy are included inManagement Discussion and Analysis Report which forms part of this report.
CORPORATE GOVERNANCE REPORT
The Company is committed to observe good corporate governance practices. The report onCorporate Governance for the financial year ended March 31 2019 as per regulation 34(3)read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 forms part of this Annual Report. The requisite Certificate from thePracticing Company Secretary of the Company confirming compliance with the conditions ofCorporate Governance is annexed to this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
As required under Section 134 (3) (m) of the Act read with Rule 8 of The Companies(Accounts) Rules 2014 particulars relating to conservation of Energy R & DTechnology absorption and foreign Exchange earnings / outgo are separately provided in theannexure to this report as Annexure - 1.
RISK MANAGEMENT POLICY
The Company had put in place an enterprise wide risk management framework. Thisholistic approach provides the assurance that to the best of its capabilities theCompany identifies assesses and mitigates risks that could materially impact itsperformance in achieving the stated objectives. The Audit committee ensures that theCompany is taking appropriate measures to achieve prudent balance between risk and rewardin both ongoing and new business activities. The Committee reviews strategic decisions ofthe Company and on regular basis reviews the Company's portfolio of risks and considersit against the Company's Risk Appetite. The Committee also recommends changes to the RiskManagement Technique and / or associated frameworks processes and practices of theCompany.
VIGIL MECHANISM POLICY
The Company had implemented a vigil mechanism whereby employees directors and otherstakeholders can report matters such as generic grievances corruption misconduct fraudmisappropriation of assets and non-compliance of code of conduct to the Company. Thepolicy safeguards the whistle blowers to report concerns or grievances and also provides adirect access to the Chairman of the Audit Committee. During the year under review none ofthe personnel has been denied access to the Chairman of Audit Committee.
CORPORATE SOCIAL RESPONSIBILITY
Company has accumulated Losses in the year under review Provisions related toexpenditure of at least two percent of the average net profits in CSR activities ispresently not applicable to the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
In Compliance with Section 134(5) of the Companies Act 2013 the Board of Directors tothe best of their knowledge and hereby confirm the following:
a) In the preparation of the annual accounts for the financial year ended 31st March2019 as far as possible and to the extent if any accounting standards mentioned by theauditors in their report as not complied with all other applicable accounting standardshave been followed along with proper explanation relating to material departure;
b) The 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 andprofit and loss account of the Company for that period;
c) The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) The Directors had prepared the annual accounts on a going concern basis; and
e) The directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively.
f) The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The policy of the Company on Director's appointment and remuneration includingcriteria for determining qualifications independence and other matters as provided undersubsection (3) of Section 178 of the Companies Act 2013 is available on the Company'swebsite at www.salsteel.co.in
DISCLOSURE UNDER SECTION 22 OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
There were no complaints pending for the Redressal at the beginning of the year and nocomplaints received during the financial year.
PARTICULARS OF THE EMPLOYEES
Information pursuant to Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is annexed to this report as Annexure- 2.Further particulars of employees remuneration as prescribed under section 197(12) of theCompanies Act 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are not attached with this report sincethere was no employee who was in receipt of excess remuneration as prescribed.
DETAILS OF RELATED PARTIES TRANSACTIONS PURUSANT TO SECTION 188(1) OF THE COMPANIESACT 2013
During the financial year all transactions entered into with the Related Parties asdefined under Companies Act 2013 were in the ordinary course of business and on an arm'slength basis and as such did not attract provisions of Section 188 (1) of Companies Act2013. The Company has formulated policy on related party transactions. Particular ofrelated party transactions in prescribed Form AOC-2 is attached at Annexure3.Approvals from the Audit Committee are obtained even for transactions which are inordinary course of business and repetitive in nature. Further on quarterly basisdisclosures are made to the Audit Committee and to the Board. Details of related partytransactions are given in the notes to financial statements.
Your company has adopted IND AS w.e.f. 1st April 2017 pursuant to Notification of theMinistry of Corporate Affairs dated 16th February 2015 in place of Accounting Standards.
AUDITORS AND AUDIT REPORTS
a. Cost Auditors
Pursuant to the provisions of Section 148 of the Companies Act 2013 and the Rules madethere under M/s. Ashish Bhavsar & Associates Cost Accountants were appointed forauditing cost accounting records of the Company for the year ending 31st March 2019.Board has further appointed M/s. Ashish Bhavsar & Associates Cost Accountants as CostAuditors for the year ending 31st March 2020 subject to approval of remuneration in theforthcoming Annual General Meeting.
b. Internal Auditor
The Company has appointed an Independent firm of Chartered Accountants to act as anInternal Auditor as per suggestion of auditors and recommendation of the Audit Committeein order to strengthen the internal control system for the Company.
c. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act 2013 read with rulesmade thereunder the Board of Directors has appointed M/s Kamlesh Shah & Co.Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of theCompany for the Financial Year 2019-20. The report submitted by the Secretarial Auditor inForm MR-3 for the financial year ended as on 31st March 2019 is attached to this reportas Annexure - 4. Remarks of secretarial auditor are self-explanatory.
d. Statutory Auditors
There are no Qualifications Reservations or Adverse remarks in the Auditor's Reportfor the year under review.
MATERIAL CHANGES / INFORMATION:
1. No material changes have taken place after the closure of the financial year up tothe date of this report which may have substantial effect on the business and financial ofthe Company.
2. No significant and material orders have been passed by any of the regulators orcourts or tribunals impacting the going concern status and companies operations in future.
EXTRACT OF ANNUAL RETURN
An extract of the Annual Return in Form MGT-9 in compliance with Section 92 of theCompanies Act 2013 read with applicable rules made thereunder is annexed to this report atAnnexure - 5.
Your Directors place on record their sincere appreciation for the valuable support andco-operation as received from government authorities Financial Institutions Banks andARCs during the year. Directors are also thankful for the support extended by CustomersSuppliers and contribution made by the employees at all level. Directors would also liketo acknowledge continued patronage extended by Company's shareholders in its entireendeavor.
| ||For and on behalf of the Board |
| ||Sd/- |
| ||Rajendra V. Shah |
|Date: 30th May 2019 ||Chairman |
|Place: Santej ||(DIN: 00020904) |