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Satia Industries Ltd.

BSE: 539201 Sector: Industrials
NSE: N.A. ISIN Code: INE170E01015
BSE 14:24 | 22 Feb 550.00 6.00






NSE 05:30 | 01 Jan Satia Industries Ltd
OPEN 550.00
52-Week high 718.60
52-Week low 202.20
P/E 6.89
Mkt Cap.(Rs cr) 550
Buy Price 546.00
Buy Qty 5.00
Sell Price 550.00
Sell Qty 5.00
OPEN 550.00
CLOSE 544.00
52-Week high 718.60
52-Week low 202.20
P/E 6.89
Mkt Cap.(Rs cr) 550
Buy Price 546.00
Buy Qty 5.00
Sell Price 550.00
Sell Qty 5.00

Satia Industries Ltd. (SATIAINDUST) - Director Report

Company director report

Dear Members

The Directors have the pleasure of presenting the 37th Annual Report of yourCompany for the financial year 2017-18.

Financial Result:

The financial performance of your Company for the year ended March 31 2018 issummarized below:-

(Rs in Lakhs)

Particulars Current Year Previous Year
Revenue and other income 67233.63 59185.66
Profit before interest depreciation and Tax 15209.71 11201.15
Interest and Financial charges 2372.59 2447.07
Depreciation 4504.07 4002.77
Profit from operations (before tax) Prior Year adjustment & exceptional Item 8333.05 4751.31
Tax Expenses
Current Tax 639.26 6.68
Deferred Tax 826.76 189.46
Profit/ (Loss) after tax 6867.03 4555.16
Less: Proposed Appropriation
Dividend on Equity Shares 250.00 200.00

Industry Review

Corporate Overview

Satia Industries Limited operates in the following business segments :-

1. Writing and Printing Paper

2. Yarn.

3. Cotton.

4. Agriculture

5. Co-generation of Power for captive consumption and

6. Solar Power.

Operational Review

The Highlight of the Company's Performance for the year ended March 31 2018 are asbelow:-

1. Production of paper of the Company increased by 9.58% to 113517.8 MTs as compared to103588.5 MT of last year

2. Net revenue of your Company increased by 12.48% to Rs 64207.32 Lakh as compared toRs 57078.52 Lakh during the corresponding period of previous year 2016-17.

3. Profit Before Depreciation and Tax increased by 46.64% to Rs 12837.12 Lakh ascompared to Rs 8754.08 Lakh during the corresponding period of previous year 2016-17

4. Profit before Tax increased by 75.38% to Rs 8333.05 Lakh as compared to Rs 4751.31Lakh during the corresponding period of previous year 2016-17

5. Net Profit Increased by 49.82 % to Rs 6791.40 Lakh as Compared to Rs 4533.17 Lakh inthe previous Year.


During the year under review the Board declared Interim Dividends -Rs 1.00 (10%) perequity share of Rs 10/- each in its meeting held on 08.02.2018. Your Directors are pleasedto recommend a Final Dividend of Rs1.50 (15%) per equity share of Rs 10/- each forFinancial Year 2017-18 for the approval of the equity shareholders at the ensuing AnnualGeneral Meeting. If approved the total dividend payout (interim and final dividend) forthe financial year 2017-18 will be Rs 2.50 (25%) per equity share of Rs 10/- each.

Financial Review

Share Capital

The paid up equity capital as on March 31 2018 was Rs.100000000/-. During the yearunder review the Company has not issued any shares.


The Company does not propose to carry any amount to any reserves.

Fixed Deposit

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.

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.

Internal Central Systems and their adequacy

The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the Internalauditor reports to the Joint Managing Director and the quarterly reports are placed beforethe Audit Committee.

Based on the report of internal audit the audit committee recommends correctiveactions the respective department needs to undertake in their respective areas and therebystrengthen the controls.


As on 31st March 2018 the company have 11 Directors consisting of 4 ExecutiveDirector Non-Independent Directors 4 Non- Executive Independent Directors and 3Additional Director (Independent) Non-executive

Sh. R.K.Bhandari is proposed to retire by rotation at the ensuing Annual GeneralMeeting (AGM) and being eligible offers himself for reappointment.

All the Independent Directors have affirmed their Independence under Section 149 of theCompanies Act 2013 and provisions of Regulation 25 of SEBI (LODR) Regulations 2015. TheCompany has obtained requisite declaration to that effect from the said Directors.

During the year under review Dr Mrs Priti Lal Shivhare (Din No 08031894) Sh AshokKumar Gupta (Din No 08068465) and Sh Arun Kumar Gupta (Din No 00371289) were appointed asan Additional Directors (Independent) and their appointment will be placed for approval bythe shareholders at the ensuing Annual General Meeting

Performance of the Board

Your Company has devised a Policy for determining qualifications positive attributesof Directors performance evaluation of Independent Directors Board Committees and otherindividual Directors which include criteria for performance evaluation of thenon-executive directors and executive directors. In accordance with the provisions of

Companies Act2013 and Regulation 17(10) of SEBI (LODR) Regulations2015 theevaluation process for the performance of the Board its Committees and individualDirectors was carried out internally. The Independent Directors met on 08th February 2018for performance evaluation of the Non Independent Directors and the entire Board ofDirectors including the Chairman and Managing Director and Executive Directors. TheIndependent Directors were satisfied with the functioning of the Board and Committees. TheIndependent Directors appreciated the leadership role of the Chairman and ManagingDirector in upholding the Company performance values and Corporate Governance standards.The results of the review by the Independent Directors was shared with the Board ofdirectors. The Board of directors have expressed their satisfaction with the evaluationresults.

Key Managerial Personnel

The following employees were designated as Whole Time key Managerial personnel by theBoard of Directors during the financial year:-

Dr Ajay Satia: CMD & CEO

Sh Ashok Kumar Khurana: CFO

Sh Rakesh Kumar Dhuria: Company Secretary

Remuneration Policy

The Board has on the recommendation of the Remuneration Committee framed a policy forselection & appointment of Directors. Senior Management and their remuneration. TheRemuneration Policy is stated in the Annexure-I.


During the year four board meeting and four Audit Committee Meetings were convened andheld. The detail of which are given in the Corporate Governance Report. The Interveninggap between the meetings was within the period prescribed under the Companies Act 2013.

Director Responsibility Statement

Pursuant to requirement of Section 134 (5) of the Companies Act 2013 your Directorsconfirm that :

(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(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 and ofthe profit or loss of the company for the period.

(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities.

(d) the Directors had prepared the annual accounts on a going concern basis.

The Directors had laid down internal financial control to be followed by the Companyand that such internal financial controls are adequate and were operating effectively. TheDirectors had devised proper systems to ensure compliance with the provision of allapplicable laws and that such system were adequate and operating effectively.

Audit reports and Auditors

Audit Reports

The Auditors Report for the year 31.03.2018 does not contain any qualificationreservation or adverse remark. The Auditors' Report is enclosed with the financialstatement in this Annual Report.

Statutory Auditors:

Under section 139 of the Companies Act 2013 and the rules made there under it ismandatory to rotate the statuary auditors on completion of the maximum term permittedunder the said section in line with the requirements of the Companies Act 2013 M/SDeepak Grover & Association Charted Accountants (firm registration no 505923) wasappointed as the Statutory Auditors of the company to hold office for a period of fiveconsecutive years from the conclusion of the 36th Annual General Meeting of the companyheld on 29th September 2017 till the conclusion of the 41st Annual General Meeting to beheld in the year 2022 subject to ratification by shareholders at the Annual GeneralMeeting or as may necessitated by the Act from time to time. The first year of audit wasof the financial statements for the year ending March 31 2018 which included the auditof the quarterly financial statements for the year. Accordingly the appointment of M/sDeepak Grover & Associates is being placed before the shareholders for ratification.

The Auditors' Report on the Accounts is self explanatory and requires no comments.

Secretarial Audit:

Pursuant to provision of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed M/s S. Parnami & Associates a firm of company Secretaries in practice toundertake the Secretarial Audit of the company. The Secretarial Audit report is annexedherewith as ''Annexure V. The secretarial audit report for the year under review requiresno comments. The said report does not contain any qualification reservation or adverseremarks.

Internal Auditors

During the year under review M/s G. Baksh & Associates Internal Auditors carriedout the internal audit and submitted their report.

Cost Audit

Pursuant to the provisions of the Companies Act 2013 M/s HMVN & Associates CostAccountants New Delhi has conducted the cost audit of the Company.

Indian Accounting Standard

Your Company has adopted Indian Accounting Standards (IND AS). The Financial Statementfor the year ended March 31 2018 have been prepared in accordance with Ind As notifiedunder the Companies (Indian Accounting Standards) Rules as amended by the Companies(Indian Accounting Standard) Rules2018 read with Section 133 and other applicableprovisions of the Companies Act 2013.

Related Party Transaction:

All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the company with Promoters Key ManagerialPersonnel or other designated persons which may have potential conflict with interest ofthe company at large. Transactions with related parties entered by the Company in thenormal course of business are periodically placed before the Audit Committee for itsomnibus approval. The Board of Directors of the Company has on the recommendation of theAudit Committee adopted a policy to regulate transactions between the Company and itsRelated Parties in compliance with the applicable provisions of the Companies Act 2013the rules there under and Listing Regulations. This Policy as considered and approved bythe Board has been uploaded on the webs site of the Company at

Subsidiary Companies

The Company does not have any subsidiary.

Vigil Mechanism

In line with Regulation 22 of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 of the Listing Agreement the Company has adopted a Whistle BlowerPolicy. The mechanism encourages the Whistle Blower to report genuine concerns orgrievances. It also provides adequate safeguard to the Whistle Blower againstvictimization. The functioning of the Vigil Mechanism is reviewed by the Audit Committeeand the Whistle Blower has direct access to the Chairman of the Audit Committee. ThePolicy on whistle blower may be accessed on the Company's website

Extract of Annual Return:

The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as "Annexure -VI

Business Risk Management

Pursuant to Section 134 (3) (n) of the Companies Act 2013 the Board of Directors ofthe Company has formed a risk management committee to frame implement and monitor therisk management plan for the Company.

Particulars of Employees

Information as required under Section 197 read with rule 5 of the Companies Appointmentand Remuneration of Managerial Personnel) Rules 2014 is appended as Annexure-II and formsan integrated part of this report.

Conservation of Energy Technology Absorption and Foreign Exchange Earning and Outgo

The Particulars as prescribed under section 134(3)(m) of the Companies Act 2013 readwith rule 8 of the Company (Accounts) Rules 2014 relating to conservation of energytechnology absorption and foreign exchange earnings and outgo is appended as anAnnexure-III to the Director's Report.

Industrial Relations:

During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.

Corporate Social Responsibility Initiatives

Satia Industries Limited realizes its responsibility towards the society at large.Satia Industries Limited recognizes that Corporate are economic organs of society andtherefore believes in making a positive difference to the society by trying to build abetter tomorrow. The Company assists in running the local Schools and directly organizesvarious programs for social welfare.

The Company has carried out 'Need Assessment Study' to fulfill the requirements of itssocial responsibility under CSR Programs and based on that assessment of demand themanagement has approved Rs.2.50 crores for CSR program in surrounding villages. Theactivities mentioned therein shall be carried out within a time frame of 5 years (from theyear 2017-18 to 2021-22). The sectors identified under the scope of CSR activities are asfollows:

CSR Activities
Budgetary Plan (Rs.)
Planned activities under CSR as per specific needs 1st Year 2nd Year 3rd Year 4th Year 5th Year Total
1. Community Health Improvement
i Disinfection facilities for dug wells and other potable water sources 200000 200000 350000 350000 300000 1400000
ii Periodically medical checkup blood donation camps to be organized near project site 250000 250000 250000 300000 350000 1400000
iii Eye checkup camps 300000 400000 500000 500000 500000 2200000
iv Health awareness camps for child and mother care health and hygiene practices. 150000 150000 200000 250000 250000 1000000
Total 900000 1000000 1300000 1400000 1400000 6000000
2. Community Education Facilities
i Augmentation of furniture blackboard etc. in village schools 500000 500000 500000 500000 500000 2500000
ii Award scholarship to meritorious students 100000 100000 100000 100000 100000 500000
iii Distribution of educational books stationary uniforms and aids etc. 400000 400000 400000 400000 400000 2000000
Total 1000000 1000000 1000000 1000000 1000000 5000000
3. Community Welfare activities
i Worship places development & beautician 300000 300000 300000 300000 300000 1500000
ii Distribution of seeds & saplings 100000 100000 100000 100000 100000 500000
iii Promotion & support to various Govt. Schemes 200000 200000 200000 200000 200000 1000000
Total 600000 600000 600000 600000 600000 3000000
4. Infrastructural Development
i Village pond retrieval 300000 300000 300000 300000 300000 1500000
ii R.O installation 300000 300000 300000 300000 300000 1500000
Total 600000 600000 600000 600000 600000 3000000
5. Community Water Conservation
i Rain water harvesting and ground water recharge pits 500000 500000 500000 500000 500000 2500000
ii Water conservation awareness programs 100000 100000 100000 100000 100000 500000
Total 600000 600000 600000 600000 600000 3000000
6. A forestation Programs
i Plantation of trees in village road side 500000 500000 500000 500000 500000 2500000
ii Development of nursery 100000 100000 100000 100000 100000 500000
Total 600000 600000 600000 600000 600000 3000000
7. Community Capacity Building
i Impairing vocational training for technical skills self- employment training for women as stitching embroidery tailoring handicrafts 200000 300000 400000 500000 600000 2000000
Total 200000 300000 400000 500000 600000 2000000
Grand Total 4500000 4700000 5100000 5300000 54000000 25000000

As part of its initiatives under "corporate social responsibility" (CSR) thecompany has contributed funds for the schemes of promotion of education and medical aid.

The Annual Report on CSR activities is annexed herewith as: Annexure- IV

Report on Corporate Governance

Our corporate governance practices are a reflection of our value system encompassingour culture policies and relationships with our stakeholders. Integrity and transparencyare key to our corporate governance practices to ensure that we gain and retain the trustof our stakeholders at all times. Corporate governance is about maximizing shareholdervalue legally ethically and sustainably. At Satia Industries Limited our Boardexercises its fiduciary responsibilities in the widest sense of the term. We also endeavorto enhance long-term shareholder value and respect minority right in all our businessdecisions. The report on the Corporate Governance as stipulated under SEBI listingregulation forms part of the Annual Report

The requisite certificate from the Auditors of the Company confirming compliance withthe conditions of corporate governance is attached to the Report on corporate governance.

Management Discussion and Analysis Report

A detailed review of the Management Discussion and Analysis Report for the year underreview is presented in separate section forming part of the Annual Report.


The Directors wish to place on record their sincere gratitude and appreciation for theassistance and co-operation received from the Government of India Government of Punjabthe Financial Institutions Punjab National Bank Central Bank of India Indian Overseasbank Andhra Bank Members Customers and Business Constituents for their continuedsupport and co – operation.

We also place on record our sincere appreciation for the contribution made by theemployees at all levels. Our consistent growth is made possible by their devout sincereand unstinted services.

For and on behalf of the Board of Directors
Place : New Delhi (Dr Ajay Satia ) (R.K.Bhandari)
Date : 13.08.2018 Chairman Cum Managing Director Joint Managing Director



The Nomination and Remuneration Committee of the Company is constituted in line withprovisions of Regulation 19 of SEBI (LODR) Regulations 2015 read with Section 178 of theCompanies Act 2013.

Brief Description of Terms of reference:

1. To carry out evaluation of the Director's performance and recommend to the Boardappointment / removal based on his / her performance.

2. To formulate a criteria for determining qualifications positive attributes andIndependence of a Director.

3. To recommend to the Board on (i) policy relating to remuneration for Directors KeyManagerial Personnel and Senior Management and (ii) Executive Directors remuneration andincentive.

4. To ensure that the remuneration for Directors is reasonable and sufficient toattract retain and motivate appropriate Directors required for running the Companyeffectively.

5. To ensure that the remuneration to Key Managerial Personnel and Senior Managementinvolves a balance between the pay and goals appropriate to the working of the Company.

6. To ensure that the relationship of remuneration to performance is clear and meetsappropriate performance benchmarks.

The Remuneration policy principle is that the remuneration and the other terms ofemployment shall be competitive in order to ensure that the Company can attract and retaincompetent Executives. The Nomination and Remuneration Committee while considering aremuneration package must ensure a balance approach reflecting short and long termperformance objectives appropriate to the working of the company and its goals.

Executive remuneration shall be proposed by the Committee and subsequently approved bythe Board of Directors Executive remuneration is evaluated annually against performanceIn determining package of remuneration the Committee may consult with the Chairman CumManaging Director.

The Board may delegate the appointment and remuneration powers in case of Sr.Management Personnel (except KMPs and Directors) to the Chairman & Managing DirectorCEO/ or Whole Time Director.


The information required pursuant to Section 197 read with Rule 5 (1) and (2) ofChapter XIII Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is furnished hereunder:

Name of the Director/KMP and Designation Remuneration in fiscal 2018 % increase in remuneration from previous year Ratio of Remuneration to MRE* Comparison of the remuneration of the KMP against the Performance of the Company
Rs in lacs % of Profits before tax % of Turnover
Dr. Ajay Satia Chairman & Managing Director 411.15 183.00 151.16 4.93 0.61
Sh. R.K. Bhandari (Joint Managing Director) 32.70 45.81 17.53 0.57 0.07
Sh. Chirag Satia (Executive Director) 360.10 100.00 132.39 4.32 0.54
Sh.Ashok Kumar Khurana CFO 16.46 27.10 6.05 0.20 0.02
Sh. R.K. Dhuria Company Secretary 14.99 14.34 5.51 0.18 0.02

1) The median Remuneration of Employees was Rs 2.72 lakh P.A.

2) In the financial year there was an increase of 9.90% in the median remuneration ofemployees.

3) There were 1245 permanent employees on the rolls of the Company as on March 312018

4) Relationship between average increase in remuneration and Company performance:-

The following factors are considered while giving increase in remuneration:

(a) Financial performance of the Company.

(b) Comparison with peer companies and

(c) Industry benchmarking and consideration towards cost of living adjustment/inflation

Comparison of the remuneration of the Key Managerial Personnel(s) against thePerformance of the Company:-

For the financial year 2017-18 key Managerial Personnel were paid 12.49% and 1.26% ofthe net profit before tax and turnover respectively of the Company.

The ratio of the remuneration of the highest paid director to that of employees who arenot director but receive remuneration in excess of the highest paid director during theyear-Not applicable

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy forDirectors key managerial personnel senior management personnel and other employees.

2. Detail of ten employees in term of remuneration

Name of Employee Designation of the Employee Remuneration Received (Rs) Qualification Experience (Yrs.) Age The last Employment
1 Leeladhar Bagla Sr G.M(Paper) 759024.00 B.Sc. 23 44.1 BILT Graphic
2 Kalam Singh Saini G.M. (Pulp Mill) 1689800.00 Dip. Pulp & Paper Tech. 31 58.4 Paper Products Ltd Naini industries ltd
3 Ashok kumar Khurana V.P.(Finance) 1645923.00 B.Com & C.A. 36 62.2 -
4 Parveen Kumar G.M.(Elect.) 1965370.00 Dip.Elect..Engg. 21 45.8 Punjab Concast Steels (Nahar International Ltd)
5 Manav Sarin G.M.(Mkt. & Instl.Sales) 1497900 M.B.A 20 46.2 Rama News Print & Papers Ltd
6 Rakesh Kumar Dhuria G.M.(Secretarial) 1499700 LLB C.S. 28 56.10 Girnar Fibres Ltd.
7 Sanjay Jain G.M.(Instt.) 1423500 Dip.Elect.Engg. 27 51.4 Raibow Papers Ltd.
8 Sanjay Singh G.M.(CRP) 1389430 M.ScPG DIP.PPT 19 47.2 Ruchira Paper Ltd. Kala Amb
9 Satpal Arora G.M.(Mkt.& PPC) 1302660 MBA 27 51.3 -
10 S.Madhukar Rao G.M.(QC) 1430100 B.S.c. 24 57.5 -



I Conservation of Energy

Energy conversation is an ongoing process in the Company

1) Modification of PM2 – HOOD WIRE PART & HEAD BOX replacement for increasingmachine speed & its overall productivity. Also PM2 Vacuum pumps capacity increased& energy efficient vacuum pumps installed for increasing machine run-ability &productivity.

2) TG 10.45 MW (double extraction & condensing) and HP boiler installation (inplace of low pressure existing boiler) for meeting & balancing the increased demand ofpower steam and for increasing the overall productivity. Hence saving in fuel & powercost also reduced grid import & grid dependency so now consuming / importing powerequivalent to MMC.

3) Decanters installed in ETP to replace existing Drum washers for power saving and toimprove consistency of sludge.

4) Evaporator modification by installing 2A &1 A Body for increasing Black Liquorconcentration (62% Total solids to 65% TS) for increasing steam generation and recoveryefficiency. With increase in steam generation power generation increased hence saving ofother boiler fuel.

5) Energy Efficient transformer installed at paper machine (3MVA 11KV/433V) in place ofold transformer.

6) Energy efficient LED lights installation in plant.

7) IE3 premium energy efficient Motors installation at paper machines Vacuum pumps.

8) Thermal insulation on steam lines condensate lines.

II Technology Absorption

Your Company is keeping constant watch in technology up gradation in existing Products.Up gradation and automation in various areas of plant and machinery is Continuouslycarried out.

Efforts made towards technology Absorption

1) TDRs installed in Hardwood Street (H/W pulp supply to machine) for increasing thepulp physical properties i.e. tear breaking length & strength of fiber to improvemachine productivity & product quality.

2) Cal coil system installed at PM1 2 and 3 for improving paper quality steam &fiber saving.

3) Micro filters (ST Machine make) installed at Stock1 23 for back water fiberrecovery and clear water for reusing at PM in place of fresh water /to reduce fresh waterconsumption.

4) ETP- Jet aeration system installed after anaerobic process in ETP to reduce COD& Discharge.

5) EOP Bleaching converted to oxy bleaching with using sodium per- carbonate to reducepower steam & chemical consumption.

6) Oxygen plant generation capacity increased by enhancing the capacity of existingoxygen plant (from 200 NM3 to 400 NM3) to meet increased demand of oxygen hence reducedproduction cost of pulp.

ii) Benefit Derived a Improved Paper Quality b Improve productivity


Expenditure for the year ended 31st March 2017 is as under :-

(Rs. in Lacs)
(i) Earning in foreign exchange. 1198.07
(ii) Expenditure in foreign currency.
CIF Value of imports
(a) Capita Goods 1702.27
(b) Store & Spares 218.83
(c) Raw Material 1300.83
Interest 26.01
Bank Charges 3.71
Travelling 24.23
Legal & Technical Fees 9.48


for and on behalf of the Board of Directors
Place : New Delhi ( Ajay Satia) (R. K. Bhandari)
Date : 13.08.2018 Chairman-Cum- Joint Managing
Managing Director Director