Your Directors take pleasure in presenting the Twenty-eighth Annual Report on thebusiness and operations of the Company together with Audited Financial Statements of theCompany for the year ended 31st March 2017.
| || ||(Rs. in Lakhs) |
|Financial Results ||2016-2017 ||2015-2016 |
|Total Income ||56288.21 ||53728.79 |
|Total Expenditure ||18665.94 ||18378.84 |
|Profit before Interest and Depreciation ||37622.27 ||35349.95 |
|Interest ||6474.00 ||5539.69 |
|Depreciation ||14998.45 ||12631.68 |
|Profit Before Tax ||16149.82 ||17178.58 |
|Provision for Taxation ||5231.99 ||6483.00 |
|Profit after Tax ||10917.83 ||10695.58 |
|Surplus broughtforward from lastyear ||31536.17 ||22664.11 |
|Profit available for Appropriation ||42454.01 ||33359.69 |
|Appropriations: || || |
|Transfer to General Reserves ||0 ||0 |
|Dividend ||1731.52 ||1515.08 |
|Taxon Dividend ||352.53 ||308.43 |
|Surplus carried forward to Balance Sheet ||40369.96 ||31536.17 |
# Figures have been regrouped/reclassified wherever necessary due to adoption ofINDAS
Inspite of challenging market conditions your Company generated revenue ofRs. 56288Lakhs an increase of 5% as compared to the previous year and the net profit ofRs. 10918Lakhs as compared to the previous year's net profit of Rs. 10696 Lakhs. The wind millsector continues to be the largest contributor to the revenues 71% followed by the Powersector 11% Refineries 9% and other sectors 9%.
Your Company witnessed a growth of 5% during Financial Year 2016-17 on account of theincreased capacity utilization and better gross yield rates. The Company's performanceduring Financial Year 2016-17 was mainly attributable to the robust measures undertaken bythe Company at all levels such as focus on pricing disciplined project executionsfocused management approach prudent financial management and better control over costconsistent follow-up for receivables and reduced interest costs on borrowings.
Your Company has been earning regular income from the business of power generation fromwindmills commissioned in Jaisalmer Rajasthan and Chitradurga Karnataka. Total Incomeearned out of Wind Power Generation was Rs. 194 Lakhs.
The Board has recommended Dividend Rs. 4.00/per Equity Share i.e. @ 200% on EquityShares for the year ended 31st March 2017. The Dividend @ Rs. 4.00/per EquityShare will be paid to eligible Members after the approval by the Members at theforthcoming Annual General Meeting. The total cash outflow on account of dividend paymentswill be Rs. 1731.52 Lakhs and dividend distribution tax of Rs. 352.53 Lakhs.
The Company proposes to retain the balance amount in the profit and loss account.
The paid up equity capital as on 31st March 2017 was Rs. 865.76 Lakhs Duringthe period under review the Company has not issued shares with differential voting rightsnor granted stock options nor sweat equity.
During the year under review the Company has availed financial assistance from AxisBank The Saraswat Co-operative Bank HDFC Bank Bank of Baroda State Bank of India andICICI Bank. The Company continues to focus on judicial management of its working capitalwith various initiatives for bringing down the cost of borrowings. The costs of facilitiessuch as commercial paper bill discounting facility etc. were kept under check throughits continuous monitoring. The Company has also taken long-term loans at very competitiveinterest rates. The Company is enjoying working capital facilities from State Bank ofIndia. Total secured loan outstanding as of 31st March 2017 wasRs. 51140Lakhs. The Company is regular in its repayment obligation with its banks.
During the year the following credit ratings were assigned to the Company:
1. ICRAA PIus' as credit rating for long term loans which indicates adequatedegree of safety in respect of bank loan profile of the Company and 'ICRAA1' ascredit rating for short term loans;
2. ICRA A 1 Plus' as credit rating for commercial paper which indicates verystrong degree of safety regarding timely payment of financial obligations.
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. The details of the investments made by Company aregiven in the notes to the financial statements.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014. As of 31stMarch 2017 there are no fixed deposits outstanding.
FOREIGN EXCHANGE EARNINGS AND OUT GO
During the year under review there were no foreign exchange earnings and the foreignexchange outgo amounted to Rs. 19725 Lakhs.
The accounts read with the notes thereon are self-explanatory and hence do not call forany explanatory statement.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All related party transactions which were entered into during the financial year wereon an arm's length basis and in the ordinary course of business. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large.
The statement that the transactions are at arm's length and in the ordinary course ofbusiness is supported by a Certificate from the Managing Director. The Company has alsoobtained the certificate from a Chartered Accountant on periodical basis. All RelatedParty Transactions are placed before the Audit Committee for their approval and to theBoard as and when required. The policy on Related Party Transactions as approved by theBoard is uploaded on the Company's website i.e. http://www.sanahvicranes.com/media/SMLRPT.pdf
PARTICULARS REGARDING CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The Company does not own any manufacturing facility and hence our processes are notenergy intensive. Hence particulars relating to conservation of energy and technologyabsorption stipulated in the Companies (Accounts) Rules 2014 are not applicable.
The assets of the Company including buildings sheds machinery cranes etc. areadequately insured.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICHHAVE OCCURRED BETWEEN 31STMARCH 2017 AND 30th MAY 2017 (DATE OF THEREPORT)
There were no material changes and commitments affecting the financial position of theCompany between the end of financial year (31st March 2017) and the date of theReport (30th May 2017). There have been no material changes and commitmentsaffecting the financial position of the Company which have occurred between the end ofthe financial year of the Company to which the financial statements relate and the date ofthis report.
Mrs. Mina C. Sanghvi and Mr. C. P. Sanghvi are liable to retire by rotation and beingeligible offer themselves for re-appointment. Mrs. Mina C. Sanghvi is a Commerce Graduateand Diploma in System Analysis and has expertise in the areas of Business managementHuman Resource Development and system design. Mr. C. P. Sanghvi is a Graduate inEngineering and has completed M.S from University of Columbia USA and has expertise inEngineering and Business Management.
DECLARATION GIVEN BY INDEPENDENT DIRECTORS U/S 149 (6) OF THE COMPANIES ACT 2013
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed under subsection (6) of Section 149 of the Companies Act 2013 and under Regulation 16 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 as amended from timeto time.
FAMILIARISATION PROGRAMMES FOR INDEPENDENT DIRECTORS
The Company has framed various programmes to familiarize the Independent Directors withthe Company their roles rights responsibilities in the Company nature of the industryin which the Company operates business model of the Company etc. The details of suchprogrammes have been disclosed on the Company's website at the following link:http://www.sanahvicranes.com/media/SML FPFID.pdf
Pursuant to the provisions of the Companies Act 2013 SEBI (Listing Obligation andDisclosure Requirements) Regulation 2015 and SEBI circular no.SEBI/HO/CEFD/CIR/P/2017/004 dated January 05th 2017 the Members of the Boardcarried out a formal review for evaluating the performance and effectiveness of the BoardCommittees of the Board and of the individual Directors including the Chairman of theBoard.
The performance of the Board was evaluated on the basis of criteria such as the Boardcomposition and structure effectiveness of Board processes participation in assessmentof annual operating plan risks etc. Using appropriate criteria the performance of thevarious Committees was separately evaluated by the Board.
In a separate meeting of Independent Directors performance of Non-IndependentDirector performance of the Board as a whole and performance of the Chairperson wereevaluated. A separate exercise was carried out to evaluate the performance of individualDirectors including the Chairman of the Board who were evaluated on parameters such asachievement against key performance objectives attendance at meetings time devoted forthe Company contribution in the Board process etc.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration is annexed herewith as "Annexure A".
NUMBER OF MEETINGS OF THE BOARD
A calendar of meetings is prepared and circulated in advance to the Directo Rs. Duringthe year four Board Meetings were convened and held the details of which are given in theCorporate Governance Report. The intervening gap between the meetings was within theperiod prescribed under the Companies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 134 (5) of the Companies Act 2013 the Directors would like tostate that:
i) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
ii) The Directors have selected such accounting policies and applied them consistentlyand madejudgmentsand estimates that were 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 ofthe profit or loss of the Company for the year under review.
iii) The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) The Directors have prepared the annual accounts on a going concern basis.
v) The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The Directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
INTERNAL CONTROL SYSTEMS ANDTHEIR ADEQUACY
The Company has an Internal Control Framework which is commensurate with the sizescale and complexity of its operations. This framework ensures adequate safeguards andprocesses to address the evolving business requirements. Key controls have been identifiedalong with risks and mitigation processes covering major areas across all businesses andfunctions. Internal controls are reviewed by Internal Audit Department on a periodicalbasis.
The Audit Committee and Board is of the opinion that the Company's internal financialcontrols were adequate and effective during Financial Year 2016-17 for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of accounting records and timely preparation ofreliable Financial disclosures.
a. Statutory Auditors
B S R&Co. LLP Chartered Accountants Pune (Firm Registration Number 101248Wallotted by the Institute of Chartered Accountants of India) who are the StatutoryAuditors of the Company hold office until the conclusion of the thirtieth Annual GeneralMeeting of the Company to be held in the year 2019 subject to ratification of theirappointment at every Annual General Meeting. The resolution seeking Member's ratificationforthe appointment of M/s. B S R&Co. LLP Chartered Accountants Pune is included initem no. 5 of the Notice convening the Annual General Meeting.
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 and amendments andmodifications thereof the Company has appointed M/s. Kanj & Associates PractisingCompany Secretaries to undertake the Secretarial Audit of the Company. The Report of theSecretarial Audit is annexed herewith as "Annexure B".
The Company does not have any subsidiary.
COMMENTS ON AUDITORS' REPORT
Statutory Auditors: There are no qualifications reservations or adverse remarks ordisclaimers made by B S R & Co. LLP Statutory Audito Rs.
Secretarial Auditor: The Company has filed Some e-forms with a delay by payment ofadditional fees. The Company is in the process of filing of Form MGT14 for reappointmentof Managing Director and for approval of financial statements.
EXTRACT OF THE ANNUAL RETURN
In accordance with the provisions of Section 134 (3) (a) of the Companies Act 2013Section 92 (3) of the Companies Act 2013 read with Rule 12 (1) of the Companies(Management and Administration) Rules 2014 the extract of Annual return of the Companyfor the Financial Year ended on 31st March 2017 is provided in the"Annexure C" to the Directors' Report.
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS
In accordance with the Guidelines of the Securities and Exchange Board of India andSEBI (Listing Obligation and Disclosure Requirements) Regulation 2015 and the provisionsof the Companies Act 2013 Report on Corporate Governance with Auditor's certificateManagement Discussion & Analysis Report are annexed and form part of annual report.
Your Company has been benchmarking itself with well established Corporate Governancepractices besides strictly complying with the requirements of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 as amended from time to time. Taking intoconsideration crucial role of Independent Directors in bringing about good governanceyour Company continued its efforts in utilizing their expertise and involving them in allcritical decision making processes.
Your Company is fully compliant with the Corporate Governance guidelines as laid outin SEBI (Listing Obligation and Disclosure Requirements) Regulation 2015. All theDirectors (and also the Members of the Senior Management) have affirmed in writing theircompliance with and adherence to the Code of Conduct adopted by the Company. The detailsof the Code of Conduct are furnished in the Corporate Governance Report attached to thisReport. The Managing Director has given a certificate of compliance with the Code ofConduct which forms part of the Corporate Governance Report as required under SEBI(Listing Obligation and Disclosure Requirements) Regulation 2015.
The Statutory Auditors of the Company have examined the requirements of CorporateGovernance with reference to SEBI (Listing Obligation and Disclosure Requirements)Regulation 2015 and have certified the Compliance as required under SEBI (ListingObligation and Disclosure Requirements) Regulation 2015. The Certificate in this regard isattached to the Corporate Governance Report.
The Managing Director/Chief Financial Officer (CEO/CFO) certification as required underSEBI (Listing Obligation and Disclosure Requirements) Regulation 2015 is attached to theCorporate Governance Report. Related Party disclosures/transactions are detailed in noteno. 24 of the notes to the financial statements.
Pursuant to Section 134 (3) (n) of the Companies Act 2013 SEBI (Listing Obligation andDisclosure Requirements) Regulation 2015 the Company has constituted a Risk ManagementCommittee. The Company has a Risk Management framework to identify evaluate businessrisks and opportunities. This framework seeks to minimize adverse impact on the businessobjectives and enhance the Company's competitive advantage. The risk framework defines therisk management approach across the enterprise at various levels. To strengthen the riskmanagement framework Company has formed segment level risk committees to identifyanalyze and mitigate the potential risks.
KEY MANAGERIAL PERSONNEL
No changes in Key Managerial Personnel appointed by the Company in the Board Meetingheld on 30thMay 2014 Mr. C. P. Sanghvi Managing Director Mr. Sham D. KajaleExecutive Director & CFO and Mr. Rajesh P. Likhite Company Secretary were designatedas "Key Managerial Personnel" of the Company pursuant to Sections 2 (51) and 203of the Companies Act 2013 read with the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014.
PARTICULARS OF EMPLOYEES
Pursuant to Section 197(12) of the Act read with the relevant rules and having referredto provisions of the first proviso to Section 136(1) of the Act the Annual Report isbeing sent to the Members of the Company excluding details of particulars of employeesand related disclosures. The said information/details are available for inspection at theRegistered Office of the Company during working hours on any working day. Any Memberinterested in obtaining this information may write to the Company Secretary and thisinformation would be provided on request.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company has adopted a Whistle Blower Policy pursuant to which the Whistle Blowercan raise concerns relating to reportable matters (as defined in the policy) such asunethical behaviour breach of Code of Conduct actual or suspected fraud ethics policyany other malpractice impropriety or wrongdoings illegality non-compliance of any lawand retaliation against the Directors and employees etc. Further the mechanism adoptedbyyour Company encourages the Whistle Blower to report genuine concerns or grievancesprovides adequate safeguards against victimization of Whistle Blower who avail of suchmechanism and also provides for direct access to the Chairman of the Audit Committee inexceptional circumstances. The functioning of the Vigil Mechanism is reviewed by the AuditCommittee from time to time. During the year nil complaints were received. Brief detailsabout the policy are provided in the Corporate Governance Report attached herewith.
PREVENTION OF INSIDERTRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading Window is closed. The Board is responsible forimplementation of the Code. All Board Members and the designated employees have confirmedcompliance with the Code.
CORPORATE SOCIAL RESPONSIBILITY
The Board of Directors of the Company have constituted the Corporate SocialResponsibility Committee (CSR Committee) comprising of Mrs. Mina C. Sanghvi Chairpersonof the Committee Mr. Dara Damania and Mr. S Padmanabhan as members of the Committee asper the requirement of the Section 135 of the Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014. As on 31st March 2017the Committee comprises three Directo Rs. The said Committee has formulated the CSR Policyindicating the activities to be undertaken by the Company monitoring the implementationof the frame work of the CSR Policy and recommending the amount to be spent on CSRactivities. Additionally the CSR Policy has been uploaded on the website of the Companyat http://www.sanahvicranes.com/media/CORPORATESOCIALRESPONSBILITYCQMMITTEE.pdf .
The Company has incurred expenditure on various CSR activities aggregating to Rs.121.37 Lakhs during the financial year 2016-17. The detailed report on the CSR activitiesis attached as Annexure F.
The Company will comply with the Secretarial Standards issued by The Institute ofCompany Secretaries of India (ICSI) as and when they are made effective.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with requirements ofthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013. All employees (permanent contractual temporary trainees) are covered under thispolicy. Internal Complaints Committee (ICC) has been set up across all its location inIndia to redress complaints received regarding sexual harassment. The cases reported tothe Committee are investigated by the Committee Members and the detailed report thereon ispresented to the Board of Directors on a regular basis. During the year nil cases werereported to the Committee.
The Board confirms that as at 31st March 2017 there were no pending casesof anti-harassment in the Company.
Employee relations have been cordial during the year under review.
Your Directors take this opportunity to thank the Government of India concerned StateGovernments Government Authorities the Stakeholders Business Associates BanksFinancial Institutions Customers Vendors and Service Providers for the valuable supportand co-operation extended by them during the year.
Your Directors would also like to place on record their sincere thanks and appreciationfor the contribution consistent hard work dedication and commitment of our employees atall levels for their contribution to the success achieved by the Company.
| ||By Order of the Board of Directors |
| ||For Sanghvi Movers Limited |
|Place : Pune ||Chandrakant Sanghvi |
|Date : 30th May 2017 ||Chairman & Managing Director |
| ||(DIN:00116599) |
|Registered Office: || |
|Survey No. 92 Tathawade || |
|Taluka Mulshi Pune411033 || |
|CIN: L29150PN1989PLC054143 || |
|Tel No.+91 (20)66744700 || |
|Fax No:+91 (20)66744724 || |