Your Directors are pleased to present the Thirty Ninth Annual Report onthe business and operations of your Company along with the audited Financial Statementsfor the year ended 31st March 2019 :
financial highlights :
The Company's financial performance for the year under review and theprevious year are furnished below:
|Particulars ||2018-19 द in Lakhs ||2017-18 द in Lakhs |
|Gross Sales and Other Income ||16662 ||17265 |
|Profit before Interest and Depreciation ||2068 ||2143 |
|Finance Cost ||1144 ||1182 |
|Depreciation ||593 ||689 |
|Profit before Tax ||331 ||272 |
|Less: Provision for Tax ||60 ||52 |
|Less: Deferred Tax ||51 ||38 |
|Profit after tax ||220 ||182 |
|Other Comprehensive Income ||-20 ||-19 |
|Total Comprehensive Income ||200 ||163 |
|Add: Balance Brought forward from Previous Year ||1257 ||1094 |
|Balance Carried Over ||1457 ||1257 |
Your Company has recorded a net profit of द331 Lakhs as against द272 Lakhs for the previous year and net profit after tax of द 220 Lakhs as against द182 Lakhs for the previous year. With a view to enhance the value of Shares and to utilizethe surplus funds the Board has decided to plough back the profits and hence notrecommended dividend for the current year.
transfer to reserves:
The Company proposes to retain the entire amount of द 200 Lakhs inthe profit and loss account.
change in nature of business:
There were no changes in the nature of business during the year.
Your Company has achieved a turnover of द 16662 Lakhs which is 3.49%lower than the turnover of the previous year. Your Company had a sluggish growth owing tothe decline in the sales in the Battery business. The battery industry is evolving led bycyclical slowdown in the dry battery segment as well as competitive pressures in theindustrial battery segment. The main raw materials Zinc and Tin Plate prices are globallydriven. Therefore the suppliers do not have much bargaining power. Apart from the demanddry-up the increased inflow of substantially cheaper imported batteries also played apart in affecting battery production.
However your Company managed to improve the turnover throughdiversification in new products. Your Company is constantly trying to bridge the gap inincreased costs and reduced turnover by introduction of new product lines and tapping ofnew markets.
business perspective :
The growing trend in the canned food market is innovations inpackaging. With increase in demand for chemical-free canned foods manufacturers arefocusing on innovations in packaging. Metal can packaging offers sustain abilityversatility quality and convenience which creates exciting opportunities for theindustry. Cans are an exemplary model in the circular economy. They may be recycled againand again forever without loss of strength or quality. Sustainability is a factor thatmore and more consumers consider a priority in purchasing decisions. Metal packaging isthe key to the sustainable development of human civilization. Metal being a permanentmaterial retains 100% of its properties even after infinite recycling thereby reducingresource wastage significantly. Metals like aluminum are very easy to sterilise forpackaging purposes and its durability and high barrier protection makes it an excellentchoice for packaging material.
The metal packaging market is expected to record a CAGR over 4% overthe forecast period (2019-2024). According to the Population Reference Bureau in 2018the degree of urbanization across the world was at around 55%. The shrinking size of thefamily along with changing patterns in lifestyle including the declining amount of timespent on preparation of meals and consumption at home is leading to a shift toward moreprocessed frozen and pre-prepared foods in which canned foods is the most common formof packaging. The metal packaging holds the largest market share of these foods. Howeverthe metal packaging market is expected to witness fierce competition from substituteflexible plastic packaging products.
The highlights of the industry trend the outlook and the opportunitiesahead for the Company are exhibited in detail in the Management Discussion and AnalysisReport attached as Annexure - IV to this report.
In the year 2018-19 the export turnover was द 3456 Lakhs as comparedto the previous year exports of द 3049 Lakhs representing an increase of 13.35% overthe previous year.
The statement pursuant to Section 129 of the Companies Act 2013containing details of financial highlights of the subsidiary company forms part of theAnnual Report.
The Company has no associate companies within the meaning of Section2(6) of the Companies Act 2013.
material changes and commitments affecting the financial position ofthe company:
There were no material changes and commitments affecting the financialposition of the Company which occurred between the end of the financial year to which thisfinancial statements relate on the date of this report.
merger of shetron metropak private limited (wholly owned subsidiary):
As the Scheme was duly approved by the stakeholders the Company hadfiled a petition before the NCLT. On April 25th 2019 Conditional Order pursuant toSections 230 to 232 of the Companies Act 2013 was received from the Hon'ble NCLTBengaluru Bench. Necessary compliance are being made to give effect to a successfulcompletion of merger.
In compliance with SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 ('the Listing Regulations') and in accordance withAccounting Standard AS-21 on Consolidated Financial Statements the audited ConsolidatedFinancial Statements incorporating the operations of the Company and its Wholly OwnedSubsidiary Company viz. Shetron Metropak Private Limited are provided in this AnnualReport.
In accordance with third proviso of Section 136(1) of the CompaniesAct 2013 the Annual Report of the Company containing therein its standalone and theconsolidated financial statements has been placed on the website www.shetrongroup.com.
Further the report on the performance and financial position of theSubsidiary and salient features of the financial statements in the prescribed Form AOC-1is annexed to this report [Annexure VIII].
The audited financial statements of Subsidiary shall be kept forinspection during business hours for Shareholders at the Registered Office of the Companyand of the Subsidiary Company. The Company will also make available the audited financialstatements and related information of the Subsidiary Company upon request by anyShareholder of the Company.
changes in directors and key managerial personnel:
Members of the Company's Board of Directors are eminent persons ofproven competence and integrity. Besides experience strong financial acumen strategicastuteness and leadership qualities they have a significant degree of commitment to theCompany and devote adequate time to the meetings and preparation.
Based on the recommendation of Nomination and Remuneration Committeeand the Board of Directors the consent of members of the Company be and is herebyaccorded for continuation of directorship of Mr. Babugowda Sanganagowda Patil as aNon-Executive Independent Director on the Board of the Company who has attained the ageof 75 years till the conclusion of 39th AGM to be held in 2019.
Based on the recommendations of the Nomination and RemunerationCommittee the Board at its Meeting held on 17th April 2019 subject to the approval ofShareholders at the ensuing Annual General Meeting
(i) re-appointed Mr. Divakar S Shetty (DIN: 00432755) as ExecutiveChairman and Whole Time Director for a further period of five (5) years with effect from16th May 2019. Accordingly a Special Resolution seeking re-appointment of Mr. Divakar SShetty as Executive Chairman and Whole Time Director of the Company is included in theNotice convening the Annual General Meeting. Details of Mr. Divakar S Shetty are exhibitedin the Explanatory Statement to the Notice of the Annual General Meeting. The Board ofDirectors recommends his appointment as Executive Chairman and Whole Time Director of theCompany.
(ii) re-appointed Mr. Kartik Nayak (DIN: 00477686) as Joint ManagingDirector for a further period of four (4) years with effect from 16th May 2019.Accordingly a Special Resolution seeking re-appointment of Mr. Kartik Nayak as JointManaging Director of the Company is included in the Notice convening the Annual GeneralMeeting. Details of Mr. Kartik Nayak are exhibited in the Explanatory Statement to theNotice of the Annual General Meeting. The Board of Directors recommends his appointment asJoint Managing Director of the Company.
(iii) re-appointed Mr. Praveen Mally (DIN: 00798354) as Joint ManagingDirector for a further period of three (3) years with effect from 16th May 2019.Accordingly a Special Resolution seeking re-appointment of Mr. Praveen Mally as JointManaging Director of the Company is included in the Notice convening the Annual GeneralMeeting. Details of Mr. Praveen Mally are exhibited in the Explanatory Statement to theNotice of the Annual General Meeting. The Board of Directors recommends his appointment asJoint Managing Director of the Company.
Dr. Narendra Mairpady (DIN: 00536905) Independent Director of theCompany resigned from the office of Independent Director with effect from close of officehours on 17th April 2019 due to personal reasons. Mrs. Yashoda Shetty (DIN: 00798116)Non Executive Director resigned w.e.f. close of office hours on 20th May 2019 due topersonal reasons.The Board of Directors of the Company places on record its sincereappreciation for the support advice and guidance provided by both the Directors to theCompany and its management which was immensely valuable to drive the Company's growth andperformance.
Changes to key managerial personnel
Ms. Neethi D' Cunha resigned as Company Secretary and ComplianceOfficer of the company w.e.f 14th March 2019 Mrs. Jagruti Mursenia was appointed asCompany Secretary and Compliance Officer of the w.e.f. 02nd May 2019.
During the year under review the Board of Directors met four (4) timesi.e. on 25-May-2018 13-Aug-2018 30-Oct-2018 and 29-Jan-2019.
The definition of 'Independence' of Directors is derived fromRegulation 16(b) of the Listing Regulations and Section 149(6) of the Companies Act 2013.The Company has received necessary declarations from each Independent Director of theCompany that they fulfill the requirements as stipulated in Section 149 (6) of theCompanies Act 2013 read with the Listing Regulations.
Further pursuant to Clause VII (1) of Schedule IV of the Companies Act2013 the Independent Directors had separate meeting on 20-May-2019.
policy on directors' appointment and remuneration :
The policy of the Company on director's appointment and remunerationincluding the criteria for determining qualifications positive attributes independenceof a director and such other matters as required under sub-section (3) of Section 178 ofthe Companies Act 2013 is available on the Company's website athttp://shetrongroup.in/pdf/Nomination%20&%20Remuneration%20Policy.pdf
The Policy was revised by the Board of Directors at its meeting held on29.01.2019. The Company affirms that the remuneration paid to the Directors is as per theterms laid out in the nomination and remuneration policy of the Company.
directors' responsibility statement:
Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the InternalStatutory and Secretarial Auditors the reviews performed by Management and the relevantBoard Committees including the Audit Committee your Board is of the opinion that theCompany's internal financial controls were adequate during the financial year 2018-19.
Accordingly Pursuant to Section 134(5) of the Companies Act 2013 theBoard of Directors to the best of their knowledge and ability confirm that:
1) In the preparation of the Annual Accounts the applicable accountingstandards had been followed along with proper explanation relating to material departures;
2) The Directors had 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 at the end of thefinancial year and of the profit and loss of the company for that period;
3) The Directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of CompaniesAct 2013 for safeguarding the assets of the company and for preventing and detecting fraudand other irregularities;
4) The Directors had prepared the Annual Accounts on a Going Concernbasis;
5) The Directors had laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and wereoperating effectively.
6) The Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.
board evaluation :
Pursuant to the provisions of the Companies Act 2013 and the ListingRegulations the Board has carried out an annual performance evaluation of itsperformance and of the Directors individually as well as the evaluation of the workingof its Audit and Nomination & Remuneration Committees. The manner in which theevaluation has been carried out has been explained in detail in the Corporate GovernanceReport which forms part of this Annual Report.
particulars of loans guarantees or investments made:
During the year the Company has not given any loans or guaranteescovered under the provisions of Section 186 of the Companies Act 2013.
The details of the investments made by Company are given in the notesto the financial statements.
extract of annual return:
Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) ofthe Companies (Management and Administration) Rules 2014 an extract of Annual Return inMGT 9 is annexed as a part of this Annual Report (Annexure - I) is furnished and the sameis published on the website of the Company.
In line with the requirements of the Listing Regulations and AccountingStandards your Company has made additional disclosures in respect of Related Partytransactions and segment reporting in notes to accounts.
risk management policy:
The Audit Committee has oversight in the area of financial risks andcontrols. The major risks identified by the businesses and functions are systematicallyaddressed through mitigating actions on a ongoing basis. The policy for risk management isavailable on the Company's website athttp://shetrongroup.in/pdf/Risk%20Management%20Policy.pdf
In terms of the provision of Sections 73 74 & 76 of the CompaniesAct 2013 read with the Companies (Acceptance of Deposits) Rules 2014 your Company hasnot accepted/ renewed any fixed deposits from the public during the year under review.
conservation of energy technology absorption foreign exchangeearnings and outgo:
The information pertaining to conservation of energy technologyabsorption foreign exchange Earnings and outgo as required under Section 134 (3)(m) ofthe Companies Act 2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 isfurnished in Annexure - IV and is attached to this report.
The Company endeavour to support the environment by adoptingenvironment-friendly practices in the working patterns The efforts in this directioncentre around making efficient use of natural resources elimination of waste andpromoting recycling of resources.
Messrs Naresh & Co Chartered Accountants (Firm Registration No.011293S) were appointed as the Statutory Auditors at the Annual General Meeting held inthe year 2017 and hold office for a term of 5 years till the conclusion of the 42ndAnnual General Meeting of the Company to be held in the year 2022. Consequent upto theamendments to the Companies Act 2013 ratification of appointment of the statutoryauditor at every Annual General Meeting is no longer required.
As per the requirement of the Central Government and pursuant to theprovisions of Section 148 of the Companies Act 2013 read with the Companies (Cost Recordsand Audit) Rules 2014 as amended from time to time your Company has been carrying outaudit of cost records relating to all product line. The Board of Directors on therecommendation of Audit Committee has appointed Messrs Vishwanath Bhat & Co CostAuditors to audit the cost accounts of the Company for the financial year 2019-20.
As required under the Companies Act 2013 a resolution seekingapproval of Members for the remuneration payable to the Cost Auditor forms part of thenotice convening the Annual General Meeting.
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 Mr.Vijayakrishna K T Practising Company Secretary was appointed to undertake the SecretarialAudit. The Report of the Secretarial Audit for the year ended 31st March 2019 is attachedto the Board's Report (Annexure - II).
auditors' report and secretarial audit report :
There was no qualification reservations or adverse remarks made eitherby the Statutory Auditors or by the Secretarial Auditor in their respective reports andtheir reports are annexed.
report on corporate governance :
Your Company has taken adequate steps to adhere to all the stipulationslaid down in Regulation 27 of the Listing Regulations. A report on compliance of the codeis annexed herewith (Annexure - VII).
Certificate from Practising Company Secretary confirming the compliancewith the conditions of Corporate Governance as stipulated under Regulation 27 of the SEBIListing Regulations 2015 is attached to this report.
contracts and arrangements with related parties:
All contracts / arrangements / transactions entered by the Companyduring the financial year with related parties were in the ordinary course of business andat arm's length basis. During the year the Company had not entered into any contract /arrangement / transaction with related parties which could be considered material inaccordance with the policy of the Company on materiality of related party transactions.All contracts / arrangements / transactions with related parties are placed before theAudit Committee and also the Board as may be required for approval.
The policy on Materiality of Related Party Transactions and also ondealing with related party transactions as approved by the Audit Committee and the Boardof Directors are displayed on the Company's websitehttp://shetrongroup.in/pdf/Realted%20Party%20Transaction%20Policy.pdf.
All Related Party Transactions entered during the year were in OrdinaryCourse of the Business and at Arm's Length basis. No Material Related Party Transactionsi.e. transactions exceeding 10% of the annual consolidated turnover as per the lastaudited financial statements were entered during the year by your Company. Theinformation on transactions with related parties pursuant to Section 134(3)(h) of the Actread with Rule 8(2) of the
Companies (Accounts) Rules 2014 are given in Annexure III in Form No.AOC-2 and the same forms part of this report.
Details of contracts / arrangements / transactions with related partiesare given in the notes to the financial statements.
transfer of unclaimed dividend to investor education and protectionfund:
Adhering to the provisions of Section 125 of the Companies Act 2013relevant amounts which remained unpaid or unclaimed for a period of seven years have beentransferred by the company from to time to time on due dates to the Investor Educationand Protection Fund.
disclosure under the sexual harassment of woman at workplace(prevention prohibition and REDRESSAL) act 2013:
The Company has been employing women employees in various cadres withinits office and factory premises. The company has in place a policy against sexualharassment in line with the requirements of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. Internal Complaint Committee is set upat shop floor level to redress any complaints received. All employees are covered underthe policy.
|(a). number of complaints filed during the financial year(18-19) ||- Nil |
|(b). number of complaints disposed of during the financial year(18-19) ||- Nil |
|(c). number of complaints pending as on end of the financial year. (18-19) ||- Nil |
health safety and environment protection:
Your Company has complied with all applicable environment laws andlabour laws. The Company has been taking all the necessary measures to protect theenvironment and maximize worker protection and safety. The company's policy requireconduct of operation in such a manner so as to ensure safety of all concerned complianceof environment regulations and preservation of natural resources.
disclosure under rule 5 of the companies (appointment and remuneration)rules 2014:
Disclosures required under Section 197 of the Companies Act 2013 readwith rule 5 of the Companies (Appointment & Remuneration) Rules 2014 have beenannexed as "Annexure VI".
management discussion and analysis report:
The Management Discussion and Analysis Report as required is annexedas Annexure V. ACKNOWLEDGEMENTS:
Your Directors wish to place on record their sincere thanks to bankersbusiness associates consultants various Government Authorities and employees at alllevels in the Company for their continued support extended to your Company's activitiesduring the year under review. Your Directors also acknowledge gratefully the Shareholdersfor their support and confidence reposed in your Company.
| ||By the order of the Board |
|Place : Bengaluru ||For Shetron Limited |
|Date : 20th May 2019 ||Divakar S Shetty |
| ||Executive Chairman |
| ||DIN: 00432755 |
| ||[Address: Divya R.S. Jain Marg |
| ||Gandhigram Road Juhu Mumbai 400049] |