S V Global Mill Ltd.
|BSE: 535621||Sector: Infrastructure|
|NSE: N.A.||ISIN Code: INE159L01013|
|BSE 00:00 | 07 Aug||34.50||
|NSE 05:30 | 01 Jan||S V Global Mill Ltd|
S V Global Mill Ltd. (SVGLOBALMILL) - Director Report
Company director report
DIRECTORS' REPORT FOR FY- 2018-Rs19.
Your Directors have pleasure in presenting their 12th Annual Report of the Companytogether with the audited financial statements for the year ended March 31 2019.
Rs. in Lakhs
Consolidated Financial Statements
The consolidated financial statements have been prepared pursuant to the provisions ofthe Companies Act 2013 as also the Listing Agreement entered in to with the stockexchange. The statements have been prepared in accordance with the IND AS as prescribed bythe ICAI. The consolidated financial statements of the Company are prepared in accordancewith the provisions of Section 129 of the Act 2013 read with the Companies (Accounts)Rules 2014 and Regulation 33 of SEBI (LODR) Regulations along with a separate statementcontaining the salient features of the financial performance of subsidiaries / associatein the prescribed form.
Overview of Operations
For the financial year under review the total income stood at Rs.1544.93 lakhs on aconsolidated basis. The PAT stood at Rs.-1568.49 Lakhs due to the provision ofRs.213419601/- on account of admission of Padmaadevi Sugars Limited (formerly Known asS V Sugar Mills Limited) in NCLT. Padmaadevi Sugars Limited is a non-related publiclimited Company in whose name the amount was outstanding in the books of accounts of ourCompany on account of a book entry devolved from Binny Limited as the result ofdemerger.
S V Global Finance Private Limited in their Board meetings held on 4.05.201903.06.2019 and 08.07.2019 declared interim dividend for the financial year 2018-19 asdetailed below:
a. Rs. 0.15 per share (1.5%) Rs.1950000
b. Rs.0.11 per share ( 1.1%) Rs.1430000
c. Rs.0.14 per share (1.4%) Rs.1820000
The audited consolidated financial statements together with Auditors' Report form partof the Annual Report. The audited financial statements of the subsidiary company will bemade available to the shareholders on receipt of request from any shareholder and it hasalso been placed on the website of the Company www.svgml.com.This will also be available for inspection by the shareholders at the registered officeduring the business hours.
The separate statement containing the salient features of the financial statements ofthe above named subsidiary in Form AOC -1 as Annexure "B" forms part ofconsolidated financial statements in compliance with Section 129(3) and other applicableprovisions if any of the Companies Act 2013 read with Rule 5 of the Companies(Accounts) Rules 2014.
In order to conserve the funds for future operations no dividend is being proposed forthe financial year 2018-Rs19.
Transfer to Reserves
Appropriation to general reserves for the financial year ended March 31 2019 as perstandalone and consolidated financial statements are as under:
Company's Working /State of Affairs
The Company operates in one segment i.e. Real Estate business and the subsidiarycompany S V Global Finance Private Limited operates as an NBFC (non-deposit). During theFinancial Year 2018-Rs19 the revenue of the Company on standalone basis is Rs.1114.94Lakhs (P.Y. Rs.1765.14 Lakhs) earned towards revenue from operations and other income. Therevenueof the subsidiary during the Financial Year 2018-Rs19 is Rs.1137.47 Lakhs (P.Y.Rs.133.99 Lakhs) earned towards revenue from operations and other income.
The Honourable Supreme Court while disposing of the SLP filed by the Company againstthe order of Hon'ble High Court of Madras on the issue relating to non-election of adirector and related corporate governance issues vide its order dated 10.05.2018 and17.05.2018 directed that the Company to buy the shares of respondents 1 to 6 at the priceof Rs.100 crores within a period of 9 months from the date of the order. On payment theshare capital of the Company shall stand reduced by virtue of the order. The Hon'ble courtfurther held that the buyback of share will not trigger the SEBI Takeover Regulations. Theobservations of the High Court will not bind in any other proceedings between the parties.
In compliance with the order of the Hon'ble Supreme Court of India dated 25.02.2019the company deposited an amount of Rs.100 crore with the Court Registry on 06.03.2019.Thereafter the Hon'ble Supreme Court vide its order dated 29.03.2019 directed theeffecting of buyback and cancellation of shares.
Accordingly the company has given effect to the same in the books of accountsresulting in reduction in the Equity Share Capital from Rs.111597050 to Rs.90414850.The balance of Rs.978817800 after reduction of shares has been adjusted against thefree reserves of the company resulting in reduction of free reserves from Rs.1402765556to Rs. 423947756. Upon transfer of the loss of the current financial year amounting toRs.184725260 the free reserves stands at Rs.239222496.
Details of significant and material orders passed by the Regulators or Courts orTribunals impacting the going concern status and company's operations in future.
There are no significant and material orders passed by the Regulators / Courts ortribunals that would impact the going concern status of the Company and its futureoperations.
Internal Financial Control and Risk Management
The Company has an established Internal Financial Control framework including internalcontrols over financial reporting operating controls and anti-fraud framework. The framework is reviewed regularly by the Management and tested by internal audit team andpresented to the Audit and Risk Management Committee. Based on periodical testing theframework is strength ened from time to time to ensure adequacy and effectiveness ofInternal Financial Control.
The established controls are constantly assessed and strengthened with new / revisedstandard operating procedures. The Company has adopted policies and procedures forensuring adherence to the Company's policies safeguarding of its assets the preventionand detection of frauds and errors the accuracy and reliability of accounting records andtimely preparation of reliable financial disclosures.
Pursuant to Section 134 (3) (n) of the Companies Act 2013 the Company has framed aRisk Management Policy. In the opinion of the Board there appears to be no element ofrisk which may threaten the existence of the Company.
The internal audit is entrusted to M/s. Kalyanasundaram& Associates CharteredAccountants to ensure that necessary controls are in place at all levels and alltransactions are adequately authorized and reported correctly. To maintain its objectivityand independence the Internal Auditor reports to the Chairman of the Audit Committee andto the Managing Director of the Company. The Audit Committee of the Board actively reviewsthe adequacy and effectiveness of the internal control systems and suggests improvementsto strengthen the same. Significant internal audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Boardperiodically.
The Company has not accepted any deposit from the public within the meaning of ChapterV of the Companies Act 2013 for the year ended 31st March 2019.
Pursuant to the provisions of Section 139 141 142 and other applicable provisions ifany of the Companies Act 2013 M/s. P. B. Vijayaraghavan and Co. Chartered AccountantsChennai (Firm Regn. No:004721S) had been appointed as the Statutory Auditors of theCompany to hold their office for a term of three consecutive financial years commencingfrom FY 2016-Rs17 to 2018-Rs19 . Hence a proposal is placed before the shareholders toreappoint M/s. P. B. Vijayaraghavan and Co. Chartered Accountants Chennai (Firm Regn.No:004721S) as Statutory Auditors of the Company for a second term of 5 consecutive yearsfrom the conclusion of this Annual General Meeting until the conclusion of 17th AnnualGeneral Meeting of the Company
The Statutory Auditors' Report for the Financial Year 2018-Rs19 does not contain anyqualification reservation or adverse remarks and the same is enclosed with the auditedfinancial statements in this Annual Report.
During the year under review the Company has neither issued shares with differentialvoting rights sweat equity shares and employees stock options nor has it resorted to buyback of its securities.
Extract of Annual Return
The extract of Annual Return as on March 31 2019in Form No. MGT - 9 as required underSection 92 and in accordance with Section 134(3)(a) of the Companies Act 2013 read withCompanies (Accounts) Rules 2014 is annexed herewith as Annexure "F" and formspart of the Board's Report.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo
The particulars prescribed under Section 134 (3) (m) of the Companies Act 2013 readwith the Companies (Accounts) Rules 2014 are not applicable. There was no foreignexchange inflow or outflow during the year under review.
Corporate Social Responsibility (CSR)
Your Company has a deep sense for caring the needy; improve the quality of life of thecommunities it serves. Pursuant to Section 135 of the Companies Act 2013 the Company hasconstituted a CSR Committee.
The Composition of the CSR Committee Web-link to the CSR Policy is annexed herewith asAnnexure "A".
Directors and Key Managerial Personnel
Retirement of Directors by Rotation
In terms of the provisions of sub-section (6) read with explanation to Section 152 ofthe Act 2013 two-thirds of the total number of Directors i.e. excluding IndependentDirectors are liable to retire by rotation and out of which one-third is liable toretire by rotation at every Annual General Meeting.
Pursuant to Section 152 of the Companies Act 2013 read with the Companies (Appointmentand Qualification of Directors) Rules 2014 and the Articles of Association of theCompany Sri. M. Ethiraj Director of the Company retires by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.
The resolution seeking approval of the members of the re-appointment of Sri. M.Ethiraj who is retiring by rotationis incorporated in the Notice of the ensuing AnnualGeneral Meeting along with brief details about him. The Board recommends the aboveappointment for the consideration of the Members of the Company at the ensuing AnnualGeneral Meeting.
Reappointment of Sri.Y.Satyajit Prasad as Independent Director
Pursuant to Section 149 and other applicable provisions of the Companies Act 2013 andrules made thereunder read with Schedule IV of the Companies Act 2013 Sri. Y. SatyajitPrasad was appointed as an Independent Director of the Company for a period of 5 yearstill 31.03.2019. Accordingly on the recommendation of the Nomination & RemunerationCommittee the Board of Directors at their meeting held on 04.02.2019 had subject to theapproval of members proposed the appointment of Sri. Y. Satyajit Prasad as an IndependentDirector of the Company for a second consecutive term for a period of five yearscommencing from 01.04.2019 to 31.03.2024.
The resolution seeking approval of the members for the re-appointment of Sri. Y.Satyajit Prasad as independent director has been incorporated in the Notice of the ensuingAnnual General Meeting along with brief details about him. The Board recommends the aboveappointment for the consideration of the Members of the Company at the ensuing AnnualGeneral Meeting.
All the Independent Directors of the Company have submitted a declaration under Section149(7) of the Companies Act 2013 that each of them meets the criteria of Independence asprovided in Section 149(6) of the Act and Regulation 16(b) of SEBI (LODR) Regulations2015 and there has been no change in the circumstances which may affect their status as anIndependent Director during the year.
Change in Chief Financial Officer/Company Secretary
During the year Sri. K. Murali Company Secretary of the company had resigned andrelieved from the services on 11th May 2019 and Mr. R. Sugumaran the present ChiefFinancial Officer was appointed as Company Secretary of the company effective 13th May2019 based on the recommendation of the Nomination and Remuneration Committee and hewould also hold the post of Chief Financial Officer till a regular Chief FinancialOfficer is appointed.
Key Managerial Personnel
Pursuant to the provisions of Section 2(51) 203 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the followingare the Key Managerial Personnel of the Company:
1. Mr. E. Shanmugam - Managing Director
2. Mr. R. Sugumaran - Company Secretary and Chief Financial Officer
Committees of the Board its constitution and details of Meetings of the Board andother Committees of the Board held during FY 2018-Rs19:
Brief details are provided in the Corporate Governance Report as per Annexure"D".
Annual Performance Evaluation
In line with the criteria evolved by the Nomination and Remuneration Committee theperformance of the Chairman Managing Director other Directors Committees KeyManagerial Personnel and Senior Executives have been evaluated considering variousevaluation aspects.
Policy on Vigil Mechanism
Pursuant to the provisions of Section 177(9) of the Companies Act 2013 read with Rule7 of the Companies (Meetings of its Board and its Powers) Rules 2014 and in accordancewith Regulation 22 of SEBI (LODR) Regulations 2015 the Company has an established Policyon Vigil Mechanism for Directors / Employees and other stakeholders of the Company toreport concerns about unethical behaviors actual or suspected fraud or violation of theCompany's Code of conduct or ethics policy.The policy also provides a direct access to theChairman of the Audit Committee to make protective disclosures to the management about thegrievances or violation of the Company's code of conduct. The policy is disclosed on theCompany's website www.svgml.com.
The Board of Directors of the Company have from time to time framed and approvedvarious Policies in pursuance of the Companies Act 2013 and the Listing Agreement/ SEBI(LODR) Regulations 2015. These Policies and Codes are reviewed by the Board and areupdated if required. The following policies have been framed and has been disclosed onthe Company's website www.svgml.com:
1. Related Party Transaction Policy.
2. Policy on Material Subsidiary.
3. CSR Policy.
4. Whistle Blower Policy consisting of Vigil Mechanism.
5. Policy on determination of Materiality of Events or Information.
6. Code of Ethics and Business Principles applicable to Directors and Senior Management
7. Familiarization Program for Independent Directors.
8. Code of Conduct for Prohibition of Insider Trading.
9. Performance Evaluation Policy.
Particulars of Loans Guarantees or Investments
The Company has not given any loans or guarantees covered under the provisions ofSection 186 of the Companies Act 2013 read with Rule 11(1) of Companies (Meetings ofBoard and its Powers) Rules 2014 except to its wholly owned subsidiary company viz. S VGlobal Finance Private Limited a loan of Rs.23.95 crores and made investment in the EquityShares of Rs.13.00 crores .Please refer to Note 3 of notes on accounts on the standalonefinancial statements for the financial year 2018-19 for details of investment made by thecompany.
Related Party Transactions
The Audit Committee and the Board of Directors have approved the related party policyand the same has been hosted on the Company's website www.svgml.com.The policy intends to ensure that proper reporting approval and disclosure processes arein place for all transactions between the Company and related parties.
The transactions entered into with related parties as defined under Section 2(76) ofthe Companies Act 2013 read with Companies (Specification of Definition Details) Rules2014 were in the ordinary course of business and at arm's length basis. There were nomaterially significant transactions with related parties during the Financial Year2018-Rs19 which were in conflict with the interest of the Company.
Suitable disclosures as required in Accounting Standard (AS) 18 have been made in thenotes to the financial statements. Details of contracts / arrangements with relatedparties as required under Section 188 (1) and 134 (3) (h) of the Companies Act 2013 readwith Rule 8(2) of the Companies (Accounts) Rules 2014 have been disclosed in Form AOC-2and is attached as Annexure "C" (Form AOC-2) as annexed which forms an integralpart of this Report.
Comparative Analysis of Remuneration paid to the Directors and Employees
Secretarial Audit Report
Pursuant to Section 204 (1) of the Companies Act 2013 read with Rule 9 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theSecretarial Audit Report for FY 2018-Rs19 in Form No. MR-3 issued by a Company Secretaryin practice is enclosed as Annexure "E" and forms an integral part of thisreport. The Secretarial Audit report does not contain any qualification reservation oradverse remarks.
Report on Corporate Governance
Your Company is in compliance with the Corporate Governance guidelines as laid out inthe SEBI (LODR) Regulations. All the Directors and the Senior Management personnel haveaffirmed in writing their compliance with and adherence to the Code of Conduct adopted bythe Company.
As per Regulation 34 (3) read with Schedule V of the SEBI (LODR) Regulations 2015 aseparate section as per Annexure "D" on Corporate Governance practicesfollowed by the Company together with a certificate from a practicing Company Secretaryconfirming compliances forms an integral part of this report.
The Managing Director and the Chief Financial Officer of the Company have certified tothe Board on financial statements and other matters in accordance with Regulation 17(8) ofthe SEBI (LODR) Regulations 2015 pertaining to MD / CFO Certification for the FinancialYear ended 31st March 2019.
Directors' Responsibility Statement
Pursuant to the provisions of Section 134(5) of the Companies Act 2013 the Board ofDirectors to the best of their knowledge and ability confirm:
a) that in the preparation of the annual accounts for the financial year ended 31stMarch 2019 the applicable Accounting Standards had been followed along with properexplanation relating to material departures if any;
b) that the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit or loss of the Company for the year ended on that date;
c) that the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
d) that the Directors had prepared the annual accounts for the financial year ended31st March 2019 on a going concern basis;
e) that the Directors had laid down policies and procedures adopted by the Company forinternal financial controls for ensuring orderly and efficient conduct of its businessincluding adherence to Company's policies the safeguarding of its assets the preventionand detection of frauds and errors the accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information and that suchinternal financial controls are adequate and were operating effectively; and
f) that as required under Section 134(5)(f) of the Companies Act 2013 the Directorshad devised proper systems to ensure compliance with the provisions of all applicable lawsand that such systems were adequate and operating effectively.
Acknowledgements and Appreciation
The Board of Directors of the Company wishes to place on record their deep sense ofgratitude to all the Shareholders of the Company for their consistent support andcontinued faith reposed in the Company. The Board would also like to express their deepsense of appreciation to the various Central and State Government Departments BankersOrganizations and Agencies external Professionals associated with the Company for theircontinued help and co-operation extended by them and last but not the least to Employeesat all levels for their hard work and commitment.