SANGINITA CHEMICALS LIMITED
Your Directors take pleasure in presenting the FOURTEENTH Annual Report of theCompany together with the Audited Accounts for the financial year ended on 31st March2019.
The brief financial results are as under:
|Particulars ||2018-19 ||2017-18 |
|Gross Revenue from Operation ||22263.70 ||22897.08 |
|Less: Vat ||- ||(242.15) |
|Excise ||- ||(577.60) |
|CGST/SGST/IGST ||(3504.40) ||(2622.44) |
|Add: Job work ||Nil ||Nil |
|Net Revenue from Operations ||18759.30 ||19454.89 |
|Other income ||15.41 ||17.99 |
|Total revenue ||18774.71 ||19472.88 |
|Profit/(Loss) before Depreciation and Tax ||611.44 ||564.50 |
|Less: Depreciation ||65.18 ||(46.92) |
|Profit/(Loss) Before Tax and Extra Ordinary Items ||546.26 ||517.58 |
|Less: ExtraOrdinary Items ||Nil ||Nil |
|Less: Current Tax ||154.34 ||172.59 |
|Deferred Tax ||(2.40) ||(0.26) |
|Prof it/(Loss) After Tax ||394.32 ||345.25 |
|Add: previous year Profit/(Loss) ||771.73 ||426.48 |
|Less: Issue of Bonus Shares ||Nil ||Nil |
|Balance Carried to Balance Sheet ||1166.05 ||771.73 |
The net revenue from operations including job work of the Company for the year 2018-19has decreased from Rs. 19454.89 Lakhs to Rs. 18759.30 Lakhs. However profit beforeDepreciation and Tax stands increased from Rs. 564.50 Lakhs to Rs. 611.44 Lakhs in thelast year.There was no negative effect under GST regime on the administration and businessof the Company.
SUBSIDIARY COMPANIES/JOINT VENTURE COMPANY/ASSOCIATE COMPANY:
The Company does not have any Subsidiary Companies or Joint Venture Company orAssociate Company.
MATERIAL CHANGES AND COMMITMENT:
There were no material changes and commitments affecting the financial position of theCompany which have occurred between the end of financial year of the Company to which thefinancial statements relate and the date of the report.
REASONS FOR REVISION OF FINANCIAL STATEMENT ORREPORT:
During the year the financial statement or report was not revised. Hence furtherdetails are not applicable.
In order to conserve resources your Directors express their inability to declare anydividend.
TRANSFER TO RESERVE:
Your Directors find it prudent not to transfer any amount to General Reserve.
MIGRATION OF LISTING OF SHARESFROM SME TO MAIN BOARD OF NSE:
The Board of Directors at their meeting held on 9th April 2019 have approved themigration of listing of its equity shares from SME Platform to the Main Board of NSELimited. The Postal Ballot process has been started to seek approval of the members forthe period from 15th April 2019 to 14th May 2019. Upon obtaining the consent of membersthe Company proposes to apply for obtaining in- principle approval of NSE Limited for thispurpose.
DIRECTORS & KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 152 of the Companies Act 2013 Mrs. Hansaben D.Chavada Director of the Company retires by rotation at the ensuing Annual General Meetingand being eligible has offered herself to be re-appointed as Director of the Company.
The Board recommends the re-appointment of Mrs. Hansaben D. Chavada as Director of theCompany liable to retire by rotation.
Mr. Pramodsinh D. Dabhi has been appointed an Independent Director of the Company atthe Board Meeting held on 11th May 2019.
The Board recommends the appointment of Mr. Pramodsinh D. Dabhi as an IndependentDirector of the Company for the period of five years from 11th May 2019 till theconclusion of Annual General Meeting to be held in the year 2024 for the approval of themembers at the ensuring Annual General meeting.
Ms. Kavita J Nanavati resigned as Company Secretary of the Company w.e.f 26th November2018. Ms. Aneri Vora was appointed as Company Secretary w.e.f 1st December 2018 andresigned as Company Secretary w.e.f 16th February 2019. Further Ms. Bhumika V Ranpura wasappointed as Company Secretary of the Company w.e.f. 16th February 2019.
UTILISATION OF ISSUE PROCEEDS:
As reported earlier the Company has fully deployed the entire funds of Rs. 1004.52Lakhs received through the public offer as per the objects of the issue specified in thesaid offer document.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement of section 134(5) of the Companies Act 2013 with respectto Directors' Responsibility Statement it is hereby confirmed:
1. that in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;
2. that the Directors had selected such accounting policies and applied themconsistently and made judgments andestimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company at the end of the financialyear and of the profit or loss of the Company for that period;
3. that the Directors had 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;
4. that the Directors had prepared the annual accounts on a going concern basis; and
5. that the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
6. that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
COMPLIANCES OF APPLICABLE SECRETARIAL STANDARDS:
The Company has complied with applicable Secretarial Standards during the year underreview.
FORMAL EVALUATION BY BOARD OF ITS OWN PERFORMANCE:
Pursuant to the provisions of the Companies Act 2013 and the SEBI (Listing Obligationsand Disclosure Requirement) Regulations 2015 the Board hascarried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of Audit and Nomination & Remuneration Committees based onthe criteria and framework adopted by the Board.
NUMBER OF MEETINGS OF BOARD:
The Board of Directors duly met 5 (Five) times.
DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received necessary Declaration from each Independent Director/s undersection 149(7) of the Companies Act 2013 that they meets the criteria of Independencelaid down in section 149(6) of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. The Board of Directors is of the opinion thatthe Independent Directors fulfils the criteria of independence and are independent fromthe management of the Company.
ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS / SWEAT EQUITY SHARES / EMPLOYEESTOCK OPTION SCHEME:
During the year the Company has not issued any equity shares with differential votingrights or sweat equity shares or shares under employee stock option scheme. Hencedisclosure regarding the same is not given.
M/s. B K Chavada & Co. Chartered Accountants the existing auditors of the Companywere appointed as Statutory Auditors of the Company at the 9th AGM for holding the officefrom the conclusion of that 9th AGM till the conclusion of the 14h l AGM (Subject t oratification by the members at every subsequent Annual General Meetings). However theterm of appointment of five years of M/s. B K Chavada & Co. Chartered Accountantsends at this Annual General Meeting. Hence the Company needs to appoint any otherStatutory Auditor for a term of five years.
The Company has received a Special Notice u/s 140 (4) of the Companies Act 2013 from amember of the Company for appointing M/s. Devpura Navlakha & Co. CharteredAccountant Ahmedabad as Statutory Auditor of the Company. Further M/s Devpura Navlakha& Co. Chartered Accountants are Peer reviewed Auditors and hence the Company will notrequire to Audit the Accounts separately from Peer Reviewed Auditors. Moreover M/s.Devpura Navlakha & Co. Chartered Accountant Ahmedabad has given their consent to actas Statutory Auditor of the Company and also provided declaration that their appointmentif made shall be within the limit prescribed.
The members are requested to consider the matter of appointment of Auditors and also tofix their remuneration.
The Board has duly reviewed the Statutory Auditor's Report on the Accounts. Theobservations comments and notes of Auditor are self-explanatory and do not call for anyexplanation /clarification.
COST AUDITORSAND COST AUDIT REPORT:
Pursuant to Section 148 of the Companies Act 2013 the Board of Directors on therecommendation of the Audit Committee appointed M/s. A G Tulsian & Co. CostAccountants as the Cost Auditors of the Company for the financial year 2018-19. M/s A GTulsian & Co. have confirmed that their appointment is within the limits of thesection 139 of the Companies Act2013 and have also certified that they are free from anydisqualifications specified under Section 141 of the Companies Act 2013. The AuditCommittee has also received a certificate from the Cost Auditor certifying theirindependence and arm's length relationship with the Company. The Cost Audit Report for thefinancial year 2017-18 was filed with the Ministry of Corporate Affairs on 3*August 2018.
As required under the Companies Act 2013 the remuneration payable to the Cost Auditoris required to be placed before the Members in the General Meeting for their ratification.Accordingly necessary resolution seeking Member's approval for ratification ofremuneration payable to the Cost Auditor was approved by the members of the Company at the13th Annual General Meeting held on 28th September 2018.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. Manoj Hurkat & Associates a firm of Company Secretaries n i Practiceto undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexedherewith as "Annexure-
|AUDIT COMMITTEE: || |
|The Audit Committee consists of the following Directors: |
|1. Mr. Jagdishkumar Thakor ||Chairperson |
|2. Mr. Faiyazkhan Pathan ||Member |
|3. Mr. Vijaysinh Chavda ||Member |
|NOMINATION & REMUNERATION COMMITTEE: |
|The Nomination and Remuneration ||Committee consists of the following Directors: |
|1. Mr. Faiyazkhan Pathan ||Chairperson |
|2. Mr. Jagdishkumar Thakor ||Member |
|3. Mrs. Hansaben Chavada ||Member |
|STAKEHOLDERS RELATIONSHIP ||COMMITTEE: |
|The Stakeholders Relationship Committee consists of the following Directors: |
|1. Mr. Faiyazkhan Pathan ||Chairperson |
|2. Mr. Jagdishkumar Thakor ||Member |
|3. Mr. Vijaysinh Chavda ||Member |
RISK MANAGEMENT POLICY/PLAN:
It may please be noted that as per the applicable requirement of Companies Act 2013 arisk management policy/plan of the Company is developed and implemented for creating andprotecting the Shareholder's value by minimizing threats or losses and to identify andprovide a framework that enables future activities of a Company to take place in aconsistent and controlled manner.
The Company has a vigil mechanism for its directors and employees to deal withinstance of fraud/ mismanagement if any and t o report concerns about unethical behavioractual or suspected fraud or violation of the Company's code of conduct or ethics policy.The details of the policy are posted on the website of the Company.
CODE OF BUSINESS CONDUCT AND ETHICS:
The Company has laid down a Code of Conduct (COC) which is applicable to all the Boardmembers and Senior Management of the Company. The COC is available on the website of theCompany www.sanginitachemicals.co.in. All the members of the
Board and Senior Management have affirmed compliance with the Code.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment measures in line with therequirements of The Sexual Harassment of Women at the Workplace (Prevention Prohibition& Redressal) Act 2013. During the year there were no complaints received under thesaid act. The Company has complied with all the applicable provisions of the said Actincluding the constitution of internal complaints committee.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration.
The Company's shareholders may refer the Company's website for the detailed Nomination& Remuneration Policy of the Company on the appointment and remuneration of Directorsincluding criteria for determining qualifications positive attributes independence of aDirector; and other matters provided under sub-section (3) of section 178.
The Company's remuneration policy is directed towards rewarding performance based onreview of achievements periodically. The remuneration policy is in consonance with theexisting industry practice.
ANALYSIS OF REMUNERATION:
The details of remuneration paid to Directors and Key Managerial Personnel is given inextract of Annual Return attached with this report.
Disclosure/details pursuant to provisions of Section 197(12) of the Companies Act 2013read with Companies (appointment and Remuneration of managerial personnel) Rules 2014 aregiven as follows:
|Names and Positions ||[A] Ratio of Directors' Remuneration to the median Remuneration of Employees ||[B] Percentage (%)increase in Remuneration |
|Mr. Dineshsinh B. Chavada (Chairperson & Managing Director) ||1.52 ||Nil |
|Mr. Vijaysinh D. Chavda (Whole Time Director) ||2.28 ||Nil |
|Mrs. Hansaben D. Chavada (Director) ||Nil ||Nil |
|Mr. Faiyazkhan Y. Pathan (Independent Director) ||Nil ||Nil |
|Mr. Jagdishkumar V. Thakor (Independent Director) ||Nil ||Nil |
The median remuneration of employees of the Company during the financial year was Rs. 1579547- p.a.
|[C] Percentage increase in the median Remuneration of Employees ||5.34% |
|[D] Number of permanent Employees on the rolls of Company ||28 (Twenty Eight) |
|[E] Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof ||There was increase of 12.18% in the average salaries of employees other than managerial personnel in the year 2018-19. There was no change in the Managerial |
| ||Remuneration in the year 2018-19 as compared to the year 2017-18. There was no change in the remuneration to the CFO and CS in the year 2018-19 |
It is hereby affirmed that the remuneration is as per remuneration policy of theCompany.
PARTICULARS OF EMPLOYEES:
The statement showing the names of the top ten employees in terms of remuneration drawnis given as "Annexure - 2."
There are no employees of the Company drawing remuneration requiring disclosure ofinformation under Section 134 of the Companies Act 2013 read with Rule 5(2) of theCompanies (Appointment & Remuneration of Managerial Personnel) Rules 2014.
DETAILS OF THE REMUNERATION TO MD/WTD (AS PER CLAUSE-IV OF SECTION-II OF PART-II OFSCHEDULE V):
(i) All elements of the remuneration package such as salary benefits bonuses stockoptions and pension: The details are given in clause- VI (A) of MGT-9 attached to thisreport as Annexure - 3.
(ii) Details of fixed component and performance-linked incentives along with theperformance criteria:
The details are given in clause- VI (A)of MGT-9 attached to this report as Annexure- 3 and performance criteria is linked with net profit of the Company
(iii) Service contracts notice period and severance fees:
Term valid till 22nd November2021. Notice period is 6 month on either side or theCompany paying 6 months remuneration in lieu of such notice and no severance fees.
(iv) Stock option details if any and whether these have been issued at a discount aswell as the period over which they accrued and how they are exercisable: The Company hasnot granted any stock option.
During the year there were no significant and material orders passed by the regulatorsor courts or tribunals impacting the going concern status and Company's operations infuture.
As the requirement of CSR Committee is not applicable to the Company no furtherdetails/disclosure required to be given in this regard.
DETAILS ON CONSERVATIONOF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGO:
|(A) Conservation of energy || |
|(i) the steps taken or impact on conservation of energy ||The Company accords high priority to conservation of energy. However there are no specific steps taken in this regard. |
|(ii) the steps taken by the company for utilizing alternate sources of energy ||The Company is not utilizing alternate sources of energy. |
|(iii) the capital investment on energy conservation equipments ||NIL |
|(B) Technology absorption || |
|(i) the efforts made towards technology absorption ||NIL |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution ||NIL |
|(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) ||The Company has not imported any technology during the year. Hence there are no details to be furnished under each of the sub clauses in this clause. |
|(a) the details of technology imported; || |
|(b) the year of import; || |
|(c) whether the technology been fully absorbed; || |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof; and || |
|(iv) the expenditure incurred on Research and Development ||There are no expenditure incurred on Research and Development by the Company. |
|(C) Foreign exchange earnings and Outgo || |
|The Foreign Exchange earned in terms of actual inflows during the year and ||Nil |
|The Foreign Exchange outgo during the year in terms of actual outflows ||Nil |
INTERNAL FINANICAL CONTROL:
The Directors has laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and have been operatingeffectively.
During the year under report your Company has not accepted any deposits pursuant toSection 73 of the Companies Act 2013. Hence further details are not given.
Details of money accepted (if any during the year) by the Company from the Directorsand/or the relatives of Directors of the Company are given in the notes to the FinancialStatements and the same are not deposit as per the applicable provisions of Companies Act2013 and rules made thereunder.
It may please be noted that as our Company is not falling in the applicability criteriaprescribed as mentioned in the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.
Hence the Report on Corporate Governance is not forming part of the Directors' Report.
EXTRACT OF ANNUALRETURN:
The details forming part of the extract of the Annual Return in form MGT- 9 is annexedherewith as "Annexure -3"
PARTICULARS OF LOANS INVESTMENTS OR GUARANTEES UNDER SECTION 186 OF THE COMPANIESACT2013:
There are no Loans Investments or Guarantees /Security given by the Company during theyear under section 186 of the Companies Act 2013; hence no particulars are required tobe given.
MANAGEMENT DISCUSSION AND ANALYSIS:
Necessary Management Discussion and Analysis Report pursuant to Regulation 34(2)(e) ofThe SEBI (LODR) Regulations 2015 is appended as "Annexure-4" to Director'sReport.
There are no particulars of contacts or arrangements with related parties referred toin Section 188(1) of the Companies Act 2013 which are required to be reported in theprescribed form AOC-2. The details of related party transactions as per AS-18 areotherwise reported in the financial statements. The related party transactions areotherwise carried out in the ordinary course of business and on arms length basis and thesame are in the best interest of the Company. The related party transactions are due tobusiness exigencies.
Your Directors wish to place on record their sincere appreciation for significantcontribution made by the employees at all the levels through their dedication hard workand commitment thereby enabling the Company to boost its performance during the yearunder report.
Your Directors also take this opportunity to place on record the valuable co-operationand continuous support extended by its valued business associates Practicing CompanySecretary Auditors Supplier Customers Banks / Financial Institutions Governmentauthorities and the shareholders for their continuously reposed confidence in the Companyand look forward to having the same support in all its future endeavors.
| ||By Order of the Board |
| ||Sd/- |
|Place : Gandhinagar ||Dineshsin h BChavada |
|Date : 11th May 2019 ||(DIN : 01497977) |
| ||Chairperson & Managing Director |