Sejal Glass Ltd.
|BSE: 532993||Sector: Industrials|
|NSE: SEJALLTD||ISIN Code: INE955I01044|
|BSE 00:00 | 30 Jan||269.00||
|NSE 00:00 | 30 Jan||269.30||
|Mkt Cap.(Rs cr)||272|
|Mkt Cap.(Rs cr)||271.69|
Sejal Glass Ltd. (SEJALLTD) - Director Report
Company director report
Your Directors take pleasure in presenting the 24th Annual Report onthe business and operations of your Company along with the summary of the auditedfinancial statements for the financial year ended March 31 2022.
As informed to the members last year M/s. Dilesh Roadlines PrivateLimited alongwith Mr. Surji Chheda and Ms. Chhaya Chheda acquired the Company through theCorporate Insolvency Resolution Process ('CIRP') under the Insolvency and Bankruptcy Code2016 ('IBC') (the 'Acquisition') vide the order dated March 26 2021 passed by the Hon'bleNational Company Law Tribunal (NCLT) Mumbai bench. Post-Acquisition the Board ofDirectors of the Company ('Board') was re-constituted and a new management ('NewManagement') was put in place to implement the Approved Resolution Plan.
The financial results presented herein should be read in the abovecontext.
1. Financial Results :
Effects of implementation of Resolution Plan:
Pursuant to the CIRP and implementation of the Resolution Plan therehas been a gain of Rs. 15018.41 Lakhs on account of the following :
Rs. In Lakhs
2. OVERVIEW OF THE COMPANY'S FINANCIAL PERFORMANCE.
During the year under review the Company clocked a turnover of Rs.2432.78 Lakhs (previous year: Rs. 1001.99 Lakhs) thereby posting a YOY additionalincrease in revenue by 142% compared to the last year's performance. The increase inturnover to the extent was mainly due to increase in sales volume and averagerealizations.
The Company recorded a net profit of Rs. 14696.23 Lakhs (PreviousYear: Net Loss Rs. 1841.52 Lakhs). This is primarily due to exceptional income booked incurrent year mainly on account of De-recognition of liabilities consisting ofloans/borrowings trade payables statutory dues other payables etc. in accordance withthe Resolution Plan approved by the Hon'ble NCLT Mumbai bench on March 26 2021.
3. PAYMENTS MADE UNDER THE RESOLUTION PLAN:
During the year under review the Company made the following paymentsas per the approved Resolution Plan;
The Company is in discussions with the Secured Creditors for Preponingthe balance payments.
The Company has recorded a net profit of Rs. 14696.23 Lakhs during thefinancial year ended March 31 2022 which is due to the exceptional gain on account ofde-recognition of liabilities consisting of loans/borrowings trade payables statutorydues other payables etc. in line with the Approved Resolution Plan.
However considering the net profit arising out of exceptional gainsbeing non cash in nature and the fact that the Company is in the stabilization stage postthe CIR Process the Board of Directors of the Company has decided not to recommend anydividend to the shareholders of the Company for the financial year ended March 312022.
5. TRANSFER TO RESERVES
The Board has decided to retain the entire amount of profit forfinancial year 2021-22.
The Company is in process of obtaining approval from the Hon'bleNational Company Law Tribunal Mumbai Bench for carrying out reduction in certainreserves against the debit balance of profit and loss account on the date of order ofHon'ble National Company Law Tribunal Mumbai Bench approving the Resolution Plan. This isproposed to be done in order to represent true and fair view of financial position of theCompany on implementation of the Resolution Plan approved by the Hon'ble National CompanyLaw Tribunal Mumbai Bench vide its order dated March 26 2021 read with order datedJune 7 2021.
6. MATERIAL DEVELOPMENTS DURING THE FINANCIAL YEAR
As stated above your Company was acquired on March 26 2021 by M/s.Dilesh Roadlines Private Limited along with Mr. Surji Chheda and Mrs. Chhaya Chhedathrough the Corporate Insolvency Resolution Process (CIRP) under the Insolvency &Bankruptcy Code (IBC) 2016. Pursuant to the NCLT Order and in accordance with theprovisions of the Approved Resolution Plan the following key events took place in theCompany during the Financial Year 2021-22;
(i) The new management w. e. f. April 25 2021 being the effectivedate i.e 30 days from the date of passing the Order has taken control of the operationsof the Company.
(ii) Constitution of Implementation and Monitoring Committee.
As provided for in the resolution plan the Implementation andMonitoring Committee was constituted on April 10 2021 comprising of the ResolutionProfessional (re-designated as the supervisor to the Implementation & MonitoringCommittee) two members from Secured Creditors and four members from ResolutionApplicants.
(iii) Reconstitution of the Board of Directors:
New Board was constituted on May 17 2021 consisting of Mr. SurjiChheda as Additional Director (Non-Executive- Non-Independent) Mr. Jiggar Savla asAdditional Director (Non-Executive) Ms. Neha Gada & Mr. Chirag Doshi as AdditionalDirectors (Non-Executive - Independent). The designation of Mr. Jiggar Savla wassubseqently changed from Non-Executive Director to Executive Director on June 10 2021.
Further in the Board Meeting held on March 30 2022 Mr. Vijay Mamania& Ms. Amruta Patankar were inducted into the Board of the Company as AdditionalDirectors (Non- Executive - Independent) w.e.f March 30 2022 & April 012022respectively.
(iv) Key Managerial Personnel:
Mr. Chandresh Rambhia was appointed as the Chief Financial Officer ofthe Company effective May 192021.
Mr. Ashwin S. Shetty is the Vice President Operations - CompanySecretary and Compliance Officer of the Company.
(v) Reduction & Consolidation of existing Equity Share Capital:
In terms of the Approved Resolution plan the existing share capital ofthe Company stood reduced from the existing Rs. 335500000/- (Rupees Thirty Three CroresFifty Five Lakhs Only) to Rs 1000000/- (Rupees Ten Lakhs Only) and the existing sharesof the Company was consolidated from the existing 33550000 equity shares of the facevalue of Rs. 10/- each to 100000 equity shares of the face value of Rs. 10/- each. TheRecord date for the said purpose was fixed on May 10 2021. Post reduction of sharecapital the securities of the Company resumed trading on December 13 2021.
(vi) Issue & Allotment of fresh equity shares to the ResolutionApplicants & its affiliates:
Further in terms of the approved Resolution Plan and consequent uponthe consolidation & Reduction of the existing Equity Share Capital the Company in itsBoard Meeting held on February 12 2022 issued & allotted 10000000 (One Crore)Equity Shares of Rs. 10/- each to the Resolution Applicant/s and /or its Affiliates asper the approved Resolution Plan.
7. MATERIAL CHANGES POST CLOSURE OF FINANCIAL YEAR:
There are no material changes and commitments affecting the financialposition of the Company which have occurred between the end of the financial year to whichthe financial statements relate i.e. March 31 2022 and the date of this Report.
8. CORPORATE GOVERNANCE :
The Corporate Governance Report for Financial Year 2021 -22 asstipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 (hereinafter referred to as 'Listing Regulations') forms part of the Annual Report.The certificate from a practicing Company Secretary on compliance(s) with the corporategovernance norms forms part of the Corporate Governance Report.
9. BOARD MEETINGS :
The Board met seven (07) times during the year the details of whichare given in the Corporate Governance Report. The intervening gap between the meetings waswithin the period as prescribed under the Companies Act 2013 ('Act') and the ListingRegulations.
Independent Directors ('IDs') inducted to the Board are providedorientation on the Company's business operations products organization structure as wellas the Board constitution and its procedures through various programmes / presentations.
The IDs are also provided with an opportunity to visit the Company'splants. The Company has four (4) Independent Directors on its board. Details offamiliarization given to the Independent Directors in the areas of business strategygovernance operations safety health environment are available on the website of theCompany.
11. INDEPENDENT DIRECTORS' DECLARATION :
Each of the Independent Directors have provided a declaration inaccordance with Section 149(7) of the Act read with Rules 16 and 25(8) of the ListingRegulations confirming that he/she meets the criteria of independence as laid out inSection 149(6) of the Act and Regulations 16(1)(b) and 25(8) of the Listing Regulations.
12. INTERNAL FINANCIAL CONTROL SYSTEMS:
The new management has taken control of the operations of the Companyw.e.f. April 25 2021 being the Effective Date. The New Board was constituted on May 172021. The new management has on best effort basis and considering the complexity of theoperations including challenges in implementing the Resolution Plan put in place aframework for Internal Financial Controls. In the judgement of the Board the saidcontrols seem to be adequate under the given circumstances.
13. RISK MANAGEMENT:
The new management has taken control of the operations of the Companyw.e.f. April 25 2021 being the Effective Date. The New Board was constituted on May 172021. The new management has on best effort basis and considering the complexity of theoperations including challenges in implementing the Resolution Plan put in place aframework of risk management to identify and mitigate risks to the strategic objectives ofthe Company.
14. VIGIL MECHANISM & WHISTLE BLOWER POLICY:
Your Company has formulated a Vigil Mechanism & Whistle BlowerPolicy to address the genuine concern if any of the directors and employees. The policyon the same can be accessed on the Company's website at www.sejalglass.co.in
15. RELATED PARTY TRANSACTIONS:
Your Company had successfully exited the CIRP on March 26 2021 andpursuant to that a new audit committee was constituted on May 17 2021. The related partytransaction/s ('RPT') during the year have been approved by the new Audit Committee. Theparticulars of material contracts or arrangements with related parties entered by theCompany during the year under reviewis given in the prescribed Form AOC - 2 as AnnexureA'. The policy on RPTs as approved by the Board is available on theCompany's website www.sejalglass.co.in .The details of the related party transactions areprovided in the accompanying financial statements.
16. DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013.
Your Company has adopted a policy on Prevention Prohibition andRedressal of Sexual Harassment at the Workplace in line with the provisions of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and theRules made thereunder.
During the Financial Year 2021-22 your Company did not receive anycomplaint of sexual harassment.
17. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(3) (c) of the Companies Act2013 with respect to the Directors' Responsibility Statement it is hereby confirmed:
i. In preparation of the annual accounts for the financial year endedMarch 31 2022 the applicable Accounting Standards had been followed along with properexplanation relating to material departures if any;
ii. We have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 312022 andof the profit & loss of the Company for the year ended on that date;
iii. 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;
iv. The annual financial statements for the financial year ended March312022 have been prepared on a 'going concern' basis;
v. Internal financial controls have been laid down to be followed bythe Company and such financial controls are adequate and are operating effectively and
vi. Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
18. SUBSIDIARIES JOINT VENTURES AND ASSOCIATES :
The Company had one Associate Company (M/s. Sejal Firebaan Glass Pvt.Ltd) as on March 312021. The Consolidated Financial Statements presented by the Companyfor the year ended March 312021 included the financial results of the Associate Companyas well. However during the year under review M/s. Sejal Firebaan Glass Pvt. Ltd no moreremained the Associate of your Company on account of the transfer of holdings in the saidAssociate by your Company. Hence the financials for this year comprise of only Standalonefigures.
19. AUDITORS :
a. Statutory Auditors
The Members of the Company at the Annual General Meeting of the Companyheld on September 30 2021 had approved the appointment of M/s.Gokhale & SatheChartered Accountants (FRN 103264W) as the Statutory Auditors of the Company for a periodof five years to hold office till the conclusion of the 28thAnnual General Meeting to beheld in the year 2026.
M/s.Gokhale & Sathe Chartered Accountants (FRN 103264W) haveaudited the books of accounts of the Company for the Financial Year ended March 312022and have issued the Auditors' Report. The said report does not contain any qualificationreservation adverse remark or disclaimer. During the year under review the StatutoryAuditors did not report any matter under Section 143(12) of the Act and therefore nodetails are required to be disclosed under Section 134(3)(ca) of the Act.
b. Secretarial Auditors :
Section 204 of the Act inter-alia requires every listed company toannex to its Board's Report a Secretarial Audit Report given by a Company Secretary inPractice. The Board of Directors of the Company in compliance with Section 204 of theAct appointed Mr. Mohammed Tariq Badgujar Proprietor of Tariq Badgujar & Co.Practicing Company Secretaries as the Secretarial Auditor to conduct the SecretarialAudit of the Company for FY 2021-22. The Secretarial Audit Report in form MR-3 is annexedas Annexure B'.
20. EXTRACT OF ANNUAL RETURN :
As required under Section 134(3)(a) of the Act the extract of theAnnual Return for the financial year 202122 in Form MGT-9 is put up on the Company'swebsite at www.sejalglass.co.in
21. SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS :
There were no significant and material orders passed by the Regulatorsor Courts or Tribunals impacting the going concern status and the Company's operationsexcept the Order dated June 07 2021 passed by the Hon'ble NCLT Mumbai bench rectifyingthe errors and omissions which had crept into the Order dated March 26 2021.
22. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
No loans guarantees or Investments covered under sections 186 of theCompanies Act 2013 have been given or provided during the year under review.
23. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGNEXCHANGE & OUTGO:
The Company is conscious of its responsibility to conserve the energyand has taken measures in relation to conservation of energy and technology absorption.The particulars in respect to conservation of energy Technology Absorption & ForeignExchange & Outgo are given in the Annexure C' 'to the Board'sReport.
24. DEPOSITS :
During the year under review the Company has not accepted any publicdeposits under the Act. In accordance with the terms provided in the approved ResolutionPlan an amount of Rs. 2940000/- was paid to the Fixed Deposit holders who had filed theclaim form with the Resolution Professional in the following manner;
25. SECRETARIAL STANDARDS:
The Company has in place proper systems to ensure compliance with theprovisions of the applicable Secretarial Standards issued by The Institute of CompanySecretaries of India and such systems are adequate and operating effectively.
26. DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT 2013 ANDOTHER DISCLOSURES AS PER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014:
The statement containing particulars of employees as required under197(12) of the Companies Act 2013 read along with Rule 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is not applicable tothe Company as no employees were in receipt of remuneration above the limits specified inRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014.
27. CORPORATE SOCIAL RESPONSIBILITY POLICY:
As per section 135 of the Companies Act 2013 the Company is notrequired to undertake any CSR activities for the financial year 2021-22 and accordinglyinformation required to be provided under Section 134 (3) (o) of the Companies Act 2013read with the Rule 9 of the Companies (Accounts) Rules 2014 in relation to disclosureabout Corporate Social Responsibility are currently not applicable to the Company.
28. CAUTIONARY STATEMENTS:
Statements in this Report and the Management Discussion and Analysismay be forward looking within the meaning of the applicable securities laws andregulations. Actual results may differ materially from those expressed in the statement.Certain factors that could affect the Company's operations include increase in price ofinputs availability of raw materials changes in Government regulations tax lawseconomic conditions and other factors.
29. MANAGEMENT DISCUSSION & ANALYSIS REPORT:
A Separate section on the Management Discussion & Analysis Reportis annexed to the Directors Report as Annexure D'.
Your Directors wish to thank the Company's customers vendorssuppliers and investors for their continuous support. The Directors also thank the BanksFinancial Institutions shareholders and concerned Government departments and agencies fortheir continued support.
Your Directors wish to place on record their deep sense of appreciation& gratitude to the Company's employees for their hard work co-operation and support.