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Sanco Industries Ltd.

BSE: 532120 Sector: Industrials
NSE: SANCO ISIN Code: INE782L01012
BSE 05:30 | 01 Jan Sanco Industries Ltd
NSE 00:00 | 19 Apr 8.55 -0.30
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Sanco Industries Ltd. (SANCO) - Director Report

Company director report

To

The Members

On Behalf of the Board of Director of your Company it is our privilege to present the 29th Annual Report on the business and operations of the company together with the audited statement of accounts for the financial year ended March 31 2019 and Auditor's Report thereon.

1. FINANCIAL HIGHLIGHTS

The financial performance of your Company are as under:

Standalone
(Rupees in Lacs)
Particulars 2018-192017-18
Turnover11195.5917212.27
Less: Total Expenses11059.7316622.66
Profit before Exceptional Items Prior Period Items and Tax135.86589.61
Add: Exceptional Items--
Less: Prior Period Items--
Net Profit before Taxation (PBT)135.86589.61
Tax Expense42.89183.99
Profit/(Loss) after Taxation (PAT)92.97405.62
Provision for proposed Dividend--
Dividend tax--
Transfer to General Reserve (Profit for the year and depreciation written back)92.97405.62

2. STATE OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK

The Company has earned a profit of Rs. 92.97 lacs as on 31.03.2019. The same has been ploughed back for further growth and expnaison of the Company.

3. CHANGE(S) IN THE NATURE OF BUSINESS

During this period there is no change in business of the Company or in the subsidiaries' business or in the nature of business carried on by them.

4. DIVIDEND

Keeping in view the Company's need for capital and its growth plans the Directors do not recommend any dividend for the year ended March 31 2019.

5. TRANSFER TO RESERVES

The amount to be transferred to reserves during the year is Rs. 92.97 Lacs.

6. CHANGES IN SHARE CAPITAL

There is no change in the Share capital of the company during this financial year.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Following are the directors and KMPs of the company as on date:

1. Mr. Sanjay Gupta (Managing Director)

Brief DescriptionPromoter Graduation from DUMBA
ExpertiseMarketing and Finance
Name of other Companies where holds directorshipSuperlink Polyfab Ltd.
Sanco Enterprises Pvt Ltd.

2. Mr. Sidhant Gupta (Director)

Brief DescriptionPromoter B.B.A. from Dibrugarh University Commercial Pilot from Eagle Flight Academy New Zealand
ExpertiseStrategic Planning & Business Development and Overseas
Operations.
Name of other Companies where holds directorshipSuperlink Polyfab Ltd.
Sanco Enterprises Pvt Ltd.
Sanjita Polymet Limited

3. Mr. Saurabh Gupta (Independent Director)

Brief DescriptionB.com CA DISA
ExpertiseAudit and Taxation
Name of other Companies whereNA
holds directorship

4. Mr. Sanjeev Kumar Jain (Independent Director)

Brief DescriptionGraduation from DUCA
ExpertiseAudit Commerce and Taxation
Name of other Companies whereNA
holds directorship

5. Mr. Sonu Kumari (Independent Director)

Brief DescriptionB.A from DU
ExpertiseMarketing
Name of other Companies where holds directorshipNA

6. Ms. Akriti Mahajan Gupta (Company Secretary)

7. Ms. Madhvi Gaur (Chief Finance Officer)

Brief DescriptionMBA in Finance from SMU and pursuing Company
Secretaryship from Institute of Company Secretaies of India
ExpertiseFinance Accounts and Taxation
Name of other Companies where holds directorshipNA

8. Surender Kumar Gupta (Independent Director)

Brief DescriptionB.A from DU M.Com from CCS University and CAIIB from
IIBF
ExpertiseFinance and Audit
Name of other Companies whereNA
holds directorship

8. STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB- SECTION (6) OF SECTION 149

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act 2013 and the relevant rules.

9. NUMBER OF MEETINGS OF BOARD OF DIRECTORS

The Board of Directors met Seven times as on 06.04.2018 07.05.2018 24.05.2018 14.08.2018 19.09.2018 14.11.2018 and 13.02.2019 during the Financial Year ended March 31 2018 and the maximum gap between any two Board Meetings was less than one Hundred and Twenty days.

10. STATEMENT INDICATING THE MANNER IN WHICH FORMAL ANNUAL EVALUATION HAS BEEN MADE BY THE BOARD OF ITS OWN PERFORMANCE AND THAT OF ITS  COMMITTEES AND INDIVIDUAL DIRECTORS

The Board of Directors has carried out an annual evaluation of its own performance board committees and individual directors pursuant to the provisions of the Act SEBI Listing Regulations and the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5 2017. The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure effectiveness of board processes information and functioning etc.

The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of criteria such as the composition of committees effectiveness of committee meetings etc. In a separate meeting of independent directors performance of non-independent directors the Chairman of the Company and the board as a whole was evaluated taking into account the views of executive directors and non-executive directors. The Board and the Nomination and Remuneration Committee reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed meaningful and constructive contribution and inputs in meetings etc. In the board meeting that followed the meeting of the independent directors and meeting of Nomination and Remuneration Committee the performance of the board its committees and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board excluding the independent director being evaluated. The performance of all the directors during the year was satisfactory and towards the growth prospects. Personnel relations with all employees remained cordial and harmonious throughout the year. Your Directors wish to place on record their sincere appreciation for the devoted services of all employees of the Company.

11. DETAILS OF SUBSIDIARY

The Company has only one subsidiary M/s Sanjita Polymet Ltd. (Company incorporated in Hong Kong). M/s Sanjita Polymet Ltd. was incorporated in August 2013 in Hong Kong to promote trading of PVC Raw Materials and Metal Products in International market. However the Company has made investment of Rupees 291.77 Lacs in the paid up share capital of M/s Sanjita Polymet Ltd. during the year. During the year the performance of M/s Sanjita Polymet Ltd. is satisfactory.

12. STATUTORY AUDITORS

Pursuant to the provisions of Section 139 of the Act read with Companies (Audit and Auditors) Rules 2014 as amended from time to time V.J.M.& Associates Chartered Accountants (Firm Registration No. 027535N/N00093) were appointed as statutory auditors from the conclusion of the 25th AGM held on 30th September 2015 till the conclusion of the 30th AGM of the Company in 2020 subject to the ratification of their appointment at every AGM if required under law.

However existing auditor M/s VJM & Associates Chartered Accountants has resigned as the Statutory Auditor of the Company. Accordingly new Statutory Auditor is to be appointed in his place

M/s Rasool Singhal & Co Chartered Accountants being eligible is proposed to be appointed as the new Statutory Auditor. Such change in auditor requires shareholders' approval. Accordingly necessary resolution for appointment of auditors is included in the Notice for this AGM.

13. COST AUDITORS

Pursuant to Section 148 of the Companies Act 2013 read with Companies (Cost Records and Audit) Amendment Rules 2014 M/s Rahul Jain &Associates has been appointed as Cost Auditors for the year 2019-20.

14. SECRETARIAL AUDIT REPORT

There were no qualifications reservations or adverse remarks or disclaimer given by the company secretary in practice in the secretarial audit report.Secretarial audit report is attached to this report.

15. RESPONSE TO AUDITOR'S REMARKS

The Notes on financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification reservation or adverse remark.

16. DISCLOSURE ON EMPLOYEE STOCK OPTION/PURCHASE SCHEME

The Company has not provided any Employee Stock Option Scheme or Purchase Scheme to the employees.

17. AUDIT COMMITTEE

The details pertaining to the composition of the audit committee are included in the Corporate Governance Report which is a part of this report.

1 8 . VIGIL MECHANISM

As per the provisions of Companies Act 2013 there is a mandatory requirement to establish a mechanism called `Vigil Mechanism' for the directors and employees of the Company to report concern about unethical behaviour actual or suspected fraud or violation of the company's code of conduct or ethics policy. The Company has adopted a Whistle Blower Policy and has established the necessary vigil mechanism for directors and employees to report concerns about unethical behavior. No person has been denied access to the Chairman of the Audit Committee. The said policy has been uploaded on the website of the Company.

19. NOMINATION AND REMUNERATION COMMITTEE

The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report which is a part of this report.

20. STAKEHOLDERS RELATIONSHIP COMMITTEE

Pursuant to the provisions of Section 178(5) of the Companies Act 2013 a Stakeholders Relationship Committee be constituted the details of the same has been the Corporate Governance Report which is a part of this report.

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21. RISK MANAGEMENT POLICY

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors.

22. EXTRACT OF THE ANNUAL RETURN

The extract of Annual Return in Form No. MGT-9 as required under Section 92 of the Companies Act 2013 for the financial year ending March 31 2019 is annexed hereto as Annexure A and forms part of this report.

23. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There is no material changes occurred subsequent to the close of the financial year ended 31.03.2019 affecting the financial position of the Company.

24. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS /TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY'S OPERATIONS IN FUTURE

No such order passed by any regulatory authority Courts or Tribunals impacting the going concern status and company's operations in future during the period under review.

25. STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has in place adequate internal financial controls with reference to financial statements. During the year such controls were tested and no reportable material weakness in the design or operation was observed.

26. DEPOSITS

The Company has not accepted any public deposits and as such no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

27. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

There were no loans made by the Company under Section 186 of the Companies Act 2013 during the year under review. However the Company has the following investments as on 31.03.2019:

S. No.Name of investeeNature of InvestmentEquity SharesAmount (in Rs.Lacs)
1Sanjita Polymet LtdWholly owned Subsidiary Co.450000291.77

Further the Company has given Corporate Gaurantee to its wholly owned subsidiary Sanjita Polymet Limited of Rs. 20 lacs USD on 29.10.2015. However the limit(loan) for which this guarantee was given stands NIL as on date. Accordingly the guarantee stands revoked.

28. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The Compay has entred into related party transactions as per Section 188 of the Act as detailed in AOC 2 attached as Annexure B which are within the limits approved by the Board Audit Committee and Members.

29. CORPORATE GOVERNANCE

Your Company is committed to maintain the highest standards of Corporate Governance. The Company adheres to the requirements set out by the Securities and Exchange Board of India's Corporate Governance practices and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015. Report on Corporate Governance for the year ended March 31 2018 forms part of the Annual Report. The requisite certificate from the SAS & Associates (Practicing Company Secretaries) confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

30. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Statement on the Company's performance industry trends and other material changes with respect to the Company is presented in a separate section forming part of annual Report.

31. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143

During the year the company has reported no frauds.

32. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE  (PREVENTION PROHIBITION &REDRESSAL) ACT 2013

During the Period no cases has been reported under Sexual Harassment of Women at Workplace.

33. CORPORATE SOCIAL RESPONSIBILITY(CSR) AND ITS TERMS OF REFERENCE

The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.

34. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of conservation of energy technology absorption foreign exchange earnings and outgo are as follows:

A. CONSERVATION OF ENERGY

I.Energy conservation measures taken

Conservation of energy is given top priority by the Company. During the year the Company has taken following measures towards energy conservation: Organizing the operating procedures in such a way that energy losses are minimized by eliminating idle running. This has helped in reducing Energy per unit. Optimization of electrical load by matching motor power capacity to the exact operational requirements.

II.Additional Investment and proposals if any being implied for reduction of consumption energy.

At present the company has no proposal for additional investment for reduction of consumption of energy.

III.Impact of measures at (I) (II) above for reduction of energy consumption impacting the cost of production of goods.

The measures adopted by the company for energy conservation have been instrumental in bringing down the cost of energy per unit of production in addition to improving quality.

B.TECHNOLOGY ABSORPTION

Effects made in technology absorption in prescribed form-B Research & Development (R & D)

The company is carrying research & development in routine manufacturing activities. There is no specific expenditure in research & development.

TECHNOLOGY ABSORPTION ADOPTION AND INNOVATION

The company has already absorbed technology fully.

C. FOREIGN EXCHANGE EARNING & OUTGO (In Rs. Lacs)

Foreign Exchange Out goes:596.07
Foreign Exchange earningNil

35. REMUNERATION

Details under Section 197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules 2014

S. NoNameDesignationRatio to median remuneration
1Mr. Sanjay GuptaManaging Director1:6
2Ms. Rita GuptaWhole Time Director1:6
3Mr. Sidhant GuptaWhole Time Director1:5
4Mr. Saurabh GuptaNon-Executive and Independent DirectorNIL
5Mr. Sanjeev Kumar JainNon-Executive and Independent DirectorNIL
6Mr. Surender Kumar GuptaNon-Executive and Independent DirectorNIL
7Ms. Sonu KumariNon-Executive and Independent DirectorNIL
8Mr. Vipul SinghalChief Financial Officer1:3
9Ms. Akriti MahajanCompany Secretary1:4
10Ms. Madhvi GaurChief Financial Officer1:1

Further there are 127 permanent employees on the rolls of company:

Work Place - 105

Corporate Office - 22

36. PARTICULARS OF EMPLOYEES

Employees was drawing in excess of the limits by the Companies Act 2013 read with the Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014 which needs to be disclosed in the directors' report.

Deatils of Top 10 Employees as per Rule 5(2) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules 2014:

S. NoNameDesignationSalary(p.a.)(in Rs.)
1Mr. Sanjay GuptaManaging Director600000
2Ms. Rita GuptaWhole Time Director600000
3Mr. Sidhant GuptaWhole Time Director480000
Mr. Vipul SinghalChief Financial Officer350000
(01.04.2018-31.01.2019
Ms. Madhvi GaurChief Financial Officer50000
(01.02.2019-31.03.2019)
6Ms. Akriti MahajanCompany Secretary240000
7Mr. Rahul MittalAssisstant Director396000
8Mr. Sunil KaushikManager Accounts420000
9Mr. Mansi GuptaAssociate Director300000
10Mr. Anurag GuptaGeneral Manager Works600000
11Mr. Deepak GuptaGeneral Manager Purchase300000

37. DIRECTORS' RESPONSIBILITY STATEMENT

In terms of provisions of Section 134(5) of the Companies Act 2013 your Directors state that: a. In the preparation of the annual accounts the applicable accounting standards had been followed along with proper explanation relating to material departures; b. The directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period; c. The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets 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 had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. f. The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

38. ACKNOWLEDGEMENTS

Your Directors would like to express their sincere appreciation for significant contribution made by the Company's executives staff and workers through their deep sense of dedication hard work and commitment and the trust reposed on us by our customers in the overall growth and prosperity of the Company. We also acknowledge the support and wise counsel extended to us by the analysts financial institutions bankers Government authorities customers vendor shareholders investors and members at large. We look forward to having the same support in our future endeavours. The Company will make every effort to meet the aspirations of its Shareholders and wish to sincerely thank them for their whole hearted co-operation and support at all times.

For Sanco Industries Limited

Sd/-Sd/-
Sanjay GuptaSidhant Gupta
Managing DirectorWhole Time Director
DIN - 00726005DIN - 02676750
R/o C-56 Block-CR/o C-56 Block-C
Surajmal Vihar Delhi - 110092Surajmal Vihar Delhi - 110092
Place: Delhi
Date: 28.05.2019

   

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