Your Directors are pleased to present to you the 20 Annual Report on the businessoperations of the Company together with the Audited Financial Statements of Accounts forthe Financial Year ended 31st March 2018:
1. Financial Results :
The Financial Performance of your company for the year ended March 31 2018 issummarized below:-
| || ||(Rs. in Lakhs) |
| ||FY 2017-18 ||FY 2016-17 |
| || ||(Restated as per IND AS) |
|Revenue from Operations ||986 ||530 |
|Other Income ||279 ||149 |
|Total Revenue ||1265 ||679 |
|Profit / (Loss) before Finance cost and Depreciation/Amortizations ||(5) ||(515) |
|Less : Finance Cost ||212 ||449 |
|Less: Depreciation / Amortization ||273 ||340 |
|Net profit/(Loss) before Exceptional items and Tax ||(480) ||(1304) |
|Provision for Contingency Doubtful Receivables Loans and advances and other current & non-current assets and other liabilities ||(268) ||(3408) |
|Net profit/(Loss) before tax ||(748) ||(4668) |
|Deferred Tax ||Nil ||Nil |
|Profit/(Loss) for the year ||(748) ||(4668) |
2. Operational Review:
The financial statements for the year ended March 31 2018 have been prepared under IndAS (Indian Accounting Standards) for the first time by the Company. The financialstatements for the year ended March 31 2017 have been restated in accordance with Ind ASfor comparative information.
The revenue from operations for the year has been Rs. 986 Lakh as against Rs. 530 Lakhin the previous year. The Net Loss for the year is Rs. 748 Lakh as compared to Rs. 4668Lakhs previous year.
During the year under review the shortage of Working Capital continued to haunt theoperations of the Company. Inspite of the same the Company managed to post a decenttopline compared to the previous year. With the increased topline your Company has managedto reach a breakeven level with respect to the factory operations. The monthly cash losseswhich the Company was incurring till the last year has stopped. The management is workingon getting adequate working capital introduced into the business at the earliest and inview of the same there is a prospect of the business showing remarkable improvement in thenext financial year. The Company has further managed to drastically bring down the lossesof the Company during the year under review.
3. Management Discussion & Analysis
A. INDUSTRY AND COMPANY OVERVIEW
The Glass industry is a continuously growing one. The future of the global flat glassindustry looks good with opportunities in the building construction glass automotiveglass and specialty glass. The global flat glass industry is forecast to grow at a CAGRof 5.5% upto 2021. The major drivers of growth for this market are growth in theconstruction market rising automotive production and sales rising per capita income andtechnological advancement. In this market building construction glass automotive glassand specialty glass are some of the major segments of flat glass. Within the global flatglass industry the automotive glass segment is expected to remain as the largest market.Low interest rates and favorable taxation schemes are expected to drive vehicle saleswhich would spur growth for this segment. Global flat glass market size is expected tosurpass 13.5 billion square meters by 2023.
The global market for construction glass is projected to grow at a CAGR of 7.08% toreach $115083.65 Million by 2020. The global Laminated Glass Market is expected to exceedmore than US$ 22.0 Billion by 2022 at a CAGR of 5%.
The Smart Glass Market is accounted value of $2.34 billion in 2015 and is projected toreach a value of $8.59 billion at the end of 2022. The global Smart Glass market isexpected to keep rising at a CAGR of 20.4% for the forecast period of 2016 2022.
The future of the fire rated glass market looks promising with opportunities in thebuilding & construction military & defense oil & gas railways and marineindustries. The global fire rated glass market is expected to reach an estimated $1.8billion by 2022 and is forecast to grow at a CAGR of 8.7% from 2017 to 2022. The majorgrowth drivers for this market are rapidly increasing construction activities in emergingcountries growing demand for passive fire protection systems and stringent buildingsafety regulations.
The global production of glass containers is estimated to reach 65.42MMT by 2022at aCAGR of 3.73%
Indian Glass Industry:-
The glass industry in India is quite old and well established. The Indian glassindustry has been growing across all segments. Sheet and float glass have recorded thefastest growth.
The container glass industry in India is buoyant with downstream demands from food& beverages pharmaceuticals and cosmetics industries. The industry is experiencing ahuge surge in demand owing to the growing awareness about health and hygiene among theconsumers. Continuous efforts by manufacturing companies to highlight the benefits ofglass are also working wonders for the promotion of glass industry in India. Glasscontainer industry is undergoing tremendous innovative changes to be more sustainable andcustomer preferable. As such light weighing of glass bottles has become a focal point inthe industry and as a result glass bottles have become light by 50% as compared to pastfew years. Light weighing aids in decreasing the logistics costs and thus manufacturersof glass containers are focusing on the same.
Flat glass segment comprises of float glass and rolled glass which are mostly used inarchitectural and automotive applications The Industry caters to Construction AutomotiveSolar and Specialty segments.
Specialty glass is mainly used in technical applications such as electronics andengineering for technical applications such as optics lighting engineering ophthalmiclenses etc. Borosilicate glasses are also included in this category.
The major drivers of the demand in the glass industry in India are government schemelike Housing for all introduction of Real Estate Regulation Act (RERA) growth inautomobile industry increasing demand for energy efficient products etc. The rapid growthof the real estate sector has triggered the demand in the glass industry. Glass isbecoming more and more popular as a building material not just in India but across theworld. Due to several advantages which make it a versatile product its adoption in newerusages has seen a huge growth in the past few years. The growth in the sector will drivethe demand of the glass industry.
Glass is by far the eco-friendliest material while packaging is concerned. Glass is"Generally rated as safe (GRAS)" and is graded safe by the U.S. Food & DrugAdministration. Glass Container industry is undergoing tremendous innovative changes inorder to be more sustainable and customer preferable. As such light-weighing of glassbottles has become a focal point in the industry and as a result glass bottles havebecome lighter by 50% as compared to 3 years ago. Glass has been the preferred packagingchoice for food and beverages. Consumers are becoming more aware of packaging and how itcan affect the foods and beverages they consume. Not only do glass containers protect theflavour and purity of organics but choosing glass demonstrates an elevated commitment tosustainability and the preservation of our natural resources.
Growing use of glass in the packaging industry is driving the container glass industryin India. As glass is reusable and 100% recyclable people are becoming more and moreconscious about safety and hygiene and increasingly making use of glass as containers
There is some concern for the Indian glass-manufacturing sector because companiescontinue to battle with a stream of dumping issue. The Indian industry's concerns havebeen compounded by glass and glassware being dumped into the Asian sub-continent fromChina and Malaysia. This material is "cheaper and probably better quality" (Sources: Care Ratings Industry Research 2018 & excerpts from other articles)
B. HUMAN CAPITAL
Relations with employees across factory and corporate office continued to be cordial.HR policies of the Company are focused on developing the potential of each employee. Withthis premise a comprehensive set of HR policies are in place aimed at attractingretaining and motivating employees at all levels. Your Company had 86 employees as of 31March 2018.
The statement containing particulars of employees as required under Section 197(12) ofthe Companies Act 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed herewith as Annexure"D" and forms part of this Report.
C. ADEQUACY OF INTERNAL CONTROL SYSTEMS
The Company has adequate internal control procedures commensurate with its size andnature of business. The objective of these procedures is to ensure efficient use andprotection of the Company's resources accuracy in financial reporting and due complianceof statues and corporate policies and procedures. The Company's accounting and reportingguidelines ensure that transactions are recorded and reported in conformity with thegenerally accepted accounting principles. The Company has an effective internal auditfunction.
D. INTERNAL FINANCIAL CONTROLS:
The Company has adequate internal controls commensurate with its size and nature of itsbusiness. The Board has reviewed internal financial controls of the Company and the AuditCommittee monitors the same in consultation with Internal Auditors of the Company.
E. RISK MANAGEMENT
Your Company evaluates potential risks and has evolved over the years a comprehensiverisk-management strategy. It takes into account changing market trends competitionscenario emerging customer preferences potential disruptions in supplies and regulatorychanges among others. All the risks and concerns as foreseen by the management areproperly documented in a Risk Management Framework which is reviewed by the Board fromtime to time.
4. Share Capital
As on 31st March 2018 the Company's issued and paid up capital stands Rs.335500000/- divided into 33550000 fully paid up equity shares of Rs. 10/- each.During the year under review your Company's Authorized Issued Subscribed and Paid upShare Capital remained unchanged.
In view of the loss for the year and the accumulated losses of the previous year yourDirectors are unable to recommend any dividend for the year ended March 31 2018.
6. Board Of Directors And Key Managerial Personnel
Ms. Pooja V. Sharma (DIN:- 07913884) had been associated with the Company asIndependent Director of the company. Ms. Pooja V. Sharma resigned from the post ofIndependent director of the company with effect from 03/11/2017. The Board places onrecord its sincere appreciation for contribution made and leadership provided by Ms. PoojaV. Sharma during her tenure as an Independent Director of the Company.
During the year under review Mrs. Dipti A. Shah was appointed as AdditionalIndependent Woman Director of the company at the Board Meeting held on August 11 2018. Asper the provisions of Section 160 of the Companies Act 2013 your Company has received anotice from a member specifying intention to propose the appointment of Mrs. Dipti A. Shahas Director in the forthcoming AGM. Furthermore a specific resolution is included in theNotice of the AGM for the appointment of Mrs. Dipti A. Shah as an Independent Director fora period of 5 years with effect from August 11 2018.
Pursuant to the provisions of Section 203 of the Companies Act 2013 the KeyManagerial Personnel of the Company are - Mr. Amrut S. Gada Chairman & ManagingDirector Mr. Mitesh K Gada Executive Director and Mr. Ashwin S. Shetty - Vice President- Operations & Company Secretary.
All the independent Directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013.
7. Extract of Annual Return
Pursuant to Section 134(3)(a) and Section 92(3) of the Act read with Rule 12(1) of theCompanies (Management and Administration) Rules 2014 the extracts of the Annual Returnin Form MGT-9 as at 31st March 2018 forms part of this report as "Annexure A".
8 . Corporate Governance
The Company is committed to maintain highest standards of corporate governance alignedwith the best practices. Pursuant to applicable provisions of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 a detailed report on CorporateGovernance forms part of this Report. The Company is in compliance with the variousrequirements and disclosures that have to be made in this regard. A certificate fromPracticing Company Secretary certifying compliance of conditions of Corporate Governanceenumerated in the Listing Regulations is presented in a separate section forming part ofthis Report
9. Public Deposits
During the year under review your Company has not accepted any deposits frompublic/members in pursuance of section 73 of the Companies Act 2013 read with Companies[Acceptance of Deposits] Rules 2014. As at 31st March 2018 the Company has outstandingfixed deposit of Rs. 150110157 /-(Including Accrued Interest). During the year underreview your company had repaid fixed Deposits (Majorly Principal amount) of an amount ofRs. 10556158/- to fixed deposit holders.
10 . Sexual Harassment of Woman at Work place (Prevention Prohibition andRedressal) Act 2013.
We have zero tolerance for sexual harassment at workplace The Company promotes ahealthy and congenial working environment irrespective of gender caste creed or socialclass of the employees and value every individual and committed to protect the dignity andrespect of every individual. The Company has always endeavored for providing a better andsafe environment free of sexual harassment at all its work places.
The Company has constituted an Internal Complaints Committee (ICC) to redress thecomplaints received regarding sexual harassment. During the year under review no cases ofsexual harassment against women employees at any of its work place were filed underSection 22 of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
11. Directors Responsibility Statement
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:
(i) That in preparation of the annual financial statements for the year ended March 312018 the applicable accounting standards have been followed along with proper explanationrelating to material departures if any;
(ii) That appropriate accounting policies have been selected & applied consistently& judgments and estimates made are reasonable & prudent so as to give a true &fair view of the state of affairs of the Company at the end of the financial year endedMarch 31 2018 & of the profit or Loss of the Company for the said year;
(iii) That proper & sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company & for preventing & detecting fraud &other irregularities;
(iv) That the annual accounts have been prepared on a going concern basis.
(v) The Company has an established internal financial control framework includinginternal controls over financial reporting operating controls and for the prevention& detection of frauds & errors. The framework is reviewed periodically byManagement and tested by the internal audit team appointed by the Management to conductthe internal audit. Based on the periodical testing the framework is strengthened fromtime to time to ensure the adequacy and effectiveness of internal financial controls.
(vi) That systems to ensure compliance with the provisions of all applicable laws werein place and that such systems were adequate and operating effectively.
M/s. Motilal & Associates Chartered Accountants Statutory Auditors of thecompany hold office until the conclusion of ensuing Annual General Meeting and haveexpressed their unwillingness to be reappointed. A special notice has been received undersection 140(4)(i) of the Companies Act 2013 from a member proposing appointment of M/s.KSPM & Associates Chartered Accountants as the statutory auditors of the company.Your company has received letter from M/s. KSPM & Associates Chartered Accountantsexpressing their willingness to be appointed and to the effect that their appointment ifmade would be within the prescribed limits under section 141 of the Companies Act 2013and that they are not disqualified for appointment. The matter is placed for considerationof members in Annual General Meeting .
13. Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act 2013 M/s. TariqBudgujar & Co. Practicing Company Secretaries to conduct Secretarial Audit for thefinancial year ended March 31 2018.The Secretarial Audit Report is attached as 'AnnexureB'.
14. Related Party Transactions:
All related party transactions that were entered into during the financial year were inthe ordinary course of the business and on an arm's length basis. The Company has notentered into material contracts or arrangements or transactions with related parties inaccordance with Section 188 of the Act read with the Companies (Meetings of Board and itsPowers) Rules 2014. The details of the related party transactions are set out in Notes tothe Standalone Financial Statements of the Company.
Form AOC - 2 pursuant to Section 134 (3) (h) of the Companies Act 2013 read with Rule8(2) of the Companies (Accounts) Rules 2014 is set out in the Annexure-E tothis report.
15. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andOutgo.
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 is annexed as "Annexure C" formspart of this Report.
16. Particulars of Loans Guarantees and Investments:
Particulars of loans given investments made guarantees given and securities providedby the Company as on March 31 2018 are given in the notes forming part of the financialstatement.
17. Vigil Mechanism/Whistle Blower Policy:
The Board of Directors of the Company has pursuant to the provisions of Section 177(9)of the Companies Act 2013 read with Rule 7 of the Companies (Meetings of Board and itsPowers) Rules 2014 framed "Vigil Mechanism Policy" for Directors and employeesof the Company to provide a mechanism which ensures adequate safeguards to employees andDirectors from any victimization on raising of concerns of any violations of legal orregulatory requirements incorrect or misrepresentation of any financial statements andreports etc. The employees of the Company have the right/ option to report theirconcern/grievance to the Chairman of the Audit Committee. The said Policy is available onthe website of the Company .The Company is committed to adhere to the highest standards ofethical moral and legal conduct of business operations.
18. Evaluation of Board Committees and Directors
Pursuant to the provisions of the Companies Act 2013 and regulation 17(10) of theListing Regulations the Board has carried out the annual performance evaluation of itsown performance the Directors individually as well as the evaluation of the working ofits Statutory Committees. A structured questionnaire was prepared after taking intoconsideration inputs received from the Directors covering various aspects of the Board'sfunctioning such as adequacy of the composition of the Board and its Committees Boardculture execution and performance of specific duties obligations and governance. Aseparate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgement safeguarding the interest of theminority shareholders etc. The performance evaluation of the Independent Directors wascarried out by the entire Board. The performance evaluation of the Chairman and the NonIndependent Directors was carried out by the Independent Directors. Based on thesecriteria the performance of the Board various Board Committees Chairman and IndividualDirectors (including Independent Directors) was found to be satisfactory.
19 . Independent Directors' Meeting:
In terms of Section 149 Schedule IV of the Companies Act 2013 and SEBI (LODR)Regulations 2015 the Independent Directors met on February 14 2018 without theattendance of Non-Independent Directors and Members of Management of the Company andreviewed the: i) performance of Non-Independent Directors and the Board of Directors ofthe Company as a whole; ii) performance of the Chairman of the Company taking intoaccount the views of Executive and Non-Executive Directors; iii) assessed the qualityquantity and timeliness of flow of information between the Management and the Board thatis necessary for the Board to effectively and reasonably perform their duties.
All the Independent Directors were present at the meeting.
20. Familiarization Programme OF Independent Directors:
In compliance with the requirements of SEBI (LODR) Regulations 2015 the Company hasput in place a familiarization program for Independent Directors to familiarize them withtheir role rights and responsibilities as Directors the operations of the Companybusiness overview etc. The details of the familiarization program is explained in theCorporate Governance Report and the same is also available on the website of the Company.
21. Disclosure Under Section 197(12) Of The Companies Act 2013 And Other Disclosuresas Per Rule 5 Of Companies (Appointment & Remuneration) Rules 2014:
The statement containing particulars of employees as required under 197(12) of theCompanies Act 2013 read along with Rule 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is not applicable to the Company as noemployees were in receipt of remuneration above the limits specified in Rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. The ratio ofthe remuneration of each Director to the median employee's remuneration and other detailsin terms of Section 197(12) of the Companies Act 2013 read along with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexedherewith as Annexure 'D' and forms part of this Report.
22. Corporate Social Responsibility Policy
As per section 135 of the Companies Act 2013 the Company is not required to undertakeany CSR activities for the financial year 2016-17 and accordingly information required tobe provided under Section 134 (3) (o) of the Companies Act 2013 read with the Rule 9 ofthe Companies (Accounts) Rules 2014 in relation to disclosure about Corporate SocialResponsibility are currently not applicable to the Company.
23. Cautionary Statements
Statements in this Report and the Management Discussion and Analysis may be forwardlooking within the meaning of the applicable securities laws and regulations. Actualresults may differ materially from those expressed in the statement. Certain factors thatcould affect the Company's operations include increase in price of inputs availability ofraw materials changes in Government regulations tax laws economic conditions and otherfactors.
Your Directors would like to express their appreciation for the assistance andco-operation received from the Government authorities banks customers businessassociates and members during the year under review. Your Directors also wish to place onrecord their deep sense of appreciation for the committed services by the executivesstaff and workers of the Company.
For and on behalf of the Board of Directors
Amrut S. Gada
Chairman and Managing Director
Date: August 11 2018