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Shirpur Gold Refinery Ltd.

BSE: 512289 Sector: Metals & Mining
NSE: SHIRPUR-G ISIN Code: INE196B01016
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VOLUME 5546
52-Week high 18.40
52-Week low 5.20
P/E
Mkt Cap.(Rs cr) 22
Buy Price 7.20
Buy Qty 100.00
Sell Price 8.23
Sell Qty 500.00
OPEN 7.54
CLOSE 7.49
VOLUME 5546
52-Week high 18.40
52-Week low 5.20
P/E
Mkt Cap.(Rs cr) 22
Buy Price 7.20
Buy Qty 100.00
Sell Price 8.23
Sell Qty 500.00

Shirpur Gold Refinery Ltd. (SHIRPUR-G) - Director Report

Company director report

To

The Members of

SHIRPUR GOLD REFINERY LIMITED

Yours Directors take pleasure in presenting the 34th Annual Report of your Companytogether with Audited Statement of Accounts for the year ended 31st March 2019 preparedas per Indian Accounting Standards prescribed under Section 133 of the Companies Act2013.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3) of the Companies Act 2013 inrelation to the Annual Financial Statements for the Financial Year 2018-19 your Directorsconfirm that:

a) The Financial Statements of the Company - comprising of the Balance Sheet as at 31stMarch 2019 and the Statement of Profit & Loss for the year ended on that date havebeen prepared on a going concern basis following applicable accounting standards and thatno material departures have been made from the same;

b) Accounting policies selected were applied consistently and the judgments andestimates related to the financial statements have been made on a prudent and reasonablebasis so as to give a true and fair view of the state of affairs of the Company as at31st March 2019 and of the profit of the Company for the year ended on that date; and

c) Proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) Requisite Internal Financial Controls had been laid down and that such internalfinancial controls are adequate and were operating effectively; and e) Proper systems havebeen devised to ensure compliance with the provisions of all applicable laws and thatsystems were adequate and operating effectively.

FINANCIAL HIGHLIGHTS

The financial performance of your Company for the Financial Year 2018-19 is summarizedin the following table: (Rs. in Millions)

Particulars Standalone – Year Ended Consolidated – Year Ended
31.03.2019 31.03.2018 31.03.2019 31.03.2018
Total Revenue 18959.61 19564.96 42745.66 52973.41
Total Expenses 18899.49 19514.98 42519.39 52810.52
Profit before Tax 60.12 49.98 226.27 162.89
Less: Exceptional
Item (19.56) - - -
Current Tax (8.35) (10.19) (8.35) (10.19)
Deferred Tax (4.71) (9.39) (4.71) (9.39)
Profit after Tax 27.50 30.40 213.21 143.31

There have been no material changes and commitments that have occurred after close ofthe financial year till the date of this report which affect the financial position ofthe Company. Based on the internal financial control framework and compliance systemsestablished in the Company the work performed by Statutory Internal SecretarialAuditors and reviews performed by the management and/or relevant Audit and otherCommittees of the Board your Board is of the opinion that the Company's internalfinancial controls were adequate and working effectively during financial year 2018-19.

DIVIDEND

With a view to conserve the resources for business requirements your Directors are ofview that the current year's profit be ploughed back into the operations and hence nodividend is recommended for the year under review.

TURNOVER AND COMPANY PERFORMANCE

The total revenue for the financial year under review was  Rs. 8959.61 Millionsas against  Rs. 9564.96 Millions showing decrease of 3% over previous year. YourCompany has registered the Net Profit before tax of Rs. 40.56 Millions as against Rs.49.98 Millions in the previous financial year. The Profit after tax stood at Rs. 27.50Millions as compared to Rs. 30.40 Millions in the previous financial year.

BUSINESS OVERVIEW

Your company's products viz. Gold Bars and Gold Jewellery are well established in themarket. The products of your Company meet the stringent quality standards of purityweighment shape size and aesthetic look.

BUSINESS EXCELLENCE & RECOGNISITON

•  The Company was awarded with Bureau of Indian Standards (BIS) certificatefor use BIS hallmark one of the requirements for participating in the Gold MonetisationScheme.

•  The Company is holding ISO 9001: 2015 ISO 14001:2015 and  OHSAS18001:2007 standard certificate for Gold Refinery.

SUBSIDIARIES

INTERNATIONAL OPERATIONS

As at March 31 2019 your Company had 1 Wholly Owned Subsidiary namely Zee Gold DMCCDubai ("Zee Gold") and2 step down subsidiaries namely ‘Precious MetalsMining and Refining Limited' ("PMMRL") Papua New Guinea and MetallicExploration And Mining Mali.

Earlier in the year 2013 the Company had incorporated a Wholly Owned SubsidiaryShirpur Gold Mining Company Pvt. Ltd. at Singapore. However in view of thenon-commencement of the operations by the above subsidiary the Board of Directors of theCompany decided to close down the same. Accordingly company had applied to Accounting& Corporate Regulatory Authority (ACRA) Singapore to strike off name of the Singaporesubsidiary which has been effected from 07.03.2019. The closed subsidiary was nonoperative and non-material. During the FY 2016-17 "PMMRL" step down subsidiarycommenced it's operations on trial basis however it couldn't continue the same due tolimited resources and other difficulties. Hence the Board of Directors of the Companydecided to close down the above subsidiary. The above subsidiary is in process of closureand is non operative and non-material. Metallic Exploration And Mining Mali step downsubsidiary of the Company is yet to commence it's operations. Apart from the above theCompany has neither formed any new subsidiary associate or Joint venture nor any companyceased to be subsidiary.

In compliance with Section 129 of the Companies Act 2013 a statement containingrequisite details including financial highlights of each of the subsidiaries is annexed tothis report. Further as per Section 136 of the Companies Act 2013 the Audited financialstatements including the consolidated financial statements and related information of theCompany and audited accounts of each of the subsidiaries are available on the website ofthe Company www.shirpurgold.com. These documents will also be available for inspectionduring business hours on all working days (except Saturday) at the Corporate Office of theCompany.

CORPORATE GOVERNANCE AND POLICIES

In order to maximize shareholder value on a sustained basis your Company has adoptedCorporate Governance practices strictly complying with the requirements of Securities& Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 ("Listing Regulations") applicable provisions of theCompanies Act 2013 and applicable Secretarial Standards issued by the Institute ofCompany Secretaries of India.

A detailed Report on Corporate Governance as per requirement of Listing Regulationsalong with the Certificate issued by the M/s B.S. Sharma & Co. Statutory Auditorsconfirming the compliance of the provisions of the Corporate Governance is attached andforms part of this Annual Report. Management's Discussion and Analysis Report for the yearunder review as stipulated under Listing Regulations is presented in a separate sectionforming part of the Annual Report.

In compliance with the requirements of Companies Act 2013 and Listing Regulationsyour Board has approved various Policies including Code of Conduct for Directors &Senior Management Material Subsidiary Policy Insider Trading Code

Document Preservation Policy Material Event Determination and Disclosure Policy FairDisclosure Policy Corporate Social Responsibility Policy Whistle Blower and VigilMechanism Policy Related Party Transaction Policy and Remuneration Policy. All thesepolicies and codes have been uploaded on Company's corporate website www.shirpurgold.com.Additionally Directors Familiarisation Programme and Terms and Conditions for appointmentof Independent Directors can be viewed on Company's corporate website www.shirpurgold.com.

In compliance with regulatory requirements the Nomination and Remuneration Committeeof your Board has fixed criteria for nominating a person on the Board which inter aliainclude desired size and composition of the Board age limit qualification / experienceareas of expertise and independence of individual. In line with this the Committee hadapproved in-principle that the initial term of an Independent Director shall not exceed 5years.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

As at March 31 2019 Your Board comprised of 5 Directors including 3 IndependentDirectors and 2 Non-Executive Directors. Independent Directors provide their declarationsboth at the time of appointment and annually confirming that they meet the criteria ofindependence as prescribed under Companies Act 2013 and Listing Regulations. During FY2018-19 your Board met 4 (Four) times details of which are available in CorporateGovernance Report annexed to this report.

During the year under review Mr. Mukund Galgali & Mr. Dinesh Kanodia NonExecutive Non Independent Directors resigned with effect from December 172018.

Your Board had based on the recommendation of Nomination and Remuneration Committeeappointed Mr. Amit Goenka as additional Non Executive Promoter Director of the Companyeffective from 18th December 2018 liable to retire by rotation. As per 161 of theCompanies Act2013 Mr. Amit Goenka shall hold office till ensuing Annual General Meeting.The Company has received notice from members proposing appointment of Mr. Amit Goenka asDirector and requisite proposals seeking your approval for their appointment as Directorforms part of the Notice of ensuing Annual General Meeting. Your Board recommends theseproposals for approval of shareholders. Further Mr. Vipin Choudhary was also appointed asPromoter Nominee Director effective from November 142018 not liable to retire byrotation.

During the year under review and after seeking requisite shareholders approval Mr.Anish Goel & Mr. Manoj Agarwal who holds the office of Independent Directors of theCompany until March 31 2019 and in respect of whom the Company has received notice inwriting from a member under Section 160 of the Act proposing his re-appointment for secondterm re-appointed for the second term as an Independent Directors not liable to retire byrotation for a period of five years from April 1 2019 until March 31 2024.

Additionally the Notice of the ensuing Annual General Meeting includes proposal forre-appointment of Ms. Kavita Kapahi for second term as Independent Director of theCompany not liable to retire by rotation for a period of 5 years on expiry of hercurrent term on March 302020. Based on the performance evaluation and after review ofconfirmation(s) of continuity of compliance with the criteria of independence underapplicable regulations your Board recommends re-appointment of Ms. Kavita Kapahi asIndependent Director for second term for approval of shareholders. In compliance with therequirements of Section 203 of Companies Act 2013 as at March 31 2019 Mr. SubashPareek Manager Ms. Archita Kothari CFO and Mr. Shyamal Padhiar Company Secretarycontinue as Key Managerial Personnel of the Company.

Post completion of FY 2019 Ms. Archita Kothari resigned as CFO of the Company andbased on recommendations of the Nomination and Remuneration Committee Mr. Sharvan KumarShah was appointed as Acting CFO in her place effective from April 18 2019.

BOARD EVALUATION

In a separate meeting of Independent Directors performance of the non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated. Based on such report of the meeting of Independent Directors and taking intoaccount the views of directors the Board had evaluated it's performance on variousparameters such as Board composition and structure effectiveness of board processeseffectiveness of flow of information attendance contributions from each directors etc.

The performance of each of the Independent Directors was also evaluated taking intoaccount the time devoted attention given to professional obligations for independentdecision making contribution towards providing strategic guidance determining importantpolicies utilising their expertise.

BOARD COMMITTES

In compliance with the requirements of Companies Act 2013 and Listing Regulationsyour Board had constituted various Board Committees including Audit Committee Nomination& Remuneration Committee Stakeholders Relationship Committee and Corporate SocialResponsibility Committee. Details of the constitution of these Committees which are inaccordance with regulatory requirements have been uploaded on the website of the Companyviz. www.shirpurgold.com. Details of scope constitution terms of reference number ofmeetings held during the year under review along with attendance of Committee Memberstherein form part of the Corporate Governance Report annexed to this report.

A detailed report on Corporate Social Responsibility in compliance with therequirements of Companies Act 2013 is annexed to this report.

AUDITORS Statutory Audit

The Statutory Auditors M/s B.S. Sharma & Co. Chartered Accounts Mumbai ( FRN128249W) was appointed as Statutory Auditors of the Company for the financial year 2018-19whose terms expires at the ensuing AGM of the Company but not eligible for reappointmentas per provisions of Section 139 of the Companies Act 2013 and Rules there under.

In compliance with rotational requirements of Statutory A uditors of the Company as perSection 139 of Companies Act 2013 and after reviewing recommendations of the AuditCommittee it is proposed to appoint M/s Parikh & Parikh Chartered AccountantsMumbai (FRN 107526W) as Statutory Auditors of the Company in place of retiring auditorsM/s B.S. Sharma & Co. Chartered Accountants to hold office from the expiry ofcurrent term of retiring auditors at the ensuing general meeting till the conclusion ofgeneral meeting to be held in 2024.

Your Company has received confirmation from the Auditors to the effect that theirappointment if made will be in accordance with the limits specified under the CompaniesAct 2013 and the firm satisfies the criteria specified in Section 141 of the CompaniesAct 2013 read with Rule 4 of the Companies (Audit & Auditors) Rules 2014.

Your Board recommends appointment of M/s Parikh & Parikh Chartered AccountantsMumbai as Statutory Auditors of the Company for a period of 5 years and seek your approvalby passing resolution at the ensuing AGM.

Secretarial Audit

In compliance with the provisions of Section 204 of the Companies Act2013 the Companyhas appointed Mrs. Mita Sanghavi Practising Company Secretary (CP No. 6364) assecretarial auditor of the Company for the financial year 2018-19. A copy of secretarialaudit report is annexed to this report.

In compliance with the provisions of SEBI Listing Regulations the Company hadsubmitted Annual Secretarial Compliance Report for the year ended 31.03.2019 to the stockexchanges which was issued by Mrs. Mita Sanghavi Secretarial Auditor.

The reports of the Statutory Audit the Secretarial Audit and Annual SecretarialCompliance Report for the year ended March 31 2019 do not contain any qualifications /observations. During the year the Statutory Auditors had not reported any matter underSection 143(12) of the Act therefore no detail is required to be disclosed under Section134(3)(ca)of the Act.

Corporate Social Responsibility

The Company was required to spend Rs. 9.65 Millions (including unspent amount ofearlier years) towards Corporate Social Responsibility (CSR) expenditure. However afteranalyzing various options and making reasonable efforts to spend the above amount theCompany couldn't find any suitable project due to which the above amount remained unspendas on March 312019.

DISCLOSURES :

I. PARTICULARS OF LOANS GUARANTEES AND

INVESTMENTS U/S 186

The details of loans investments and guarantee as required u/s 186(4) of the CompaniesAct 2013 are annexed to the Director's Report.

II. RELATED PARTY TRANSACTIONS

All related party transactions specifying the nature value and terms of thetransactions including the arms-length justification are placed before the AuditCommittee for its approval and statement of all related party transactions carried out isplaced before the Audit Committee for its review on a quarterly basis.

All the related parties transactions entered by the Company during the financial yearunder review were on arm's length basis in the ordinary course of business and incompliance with the applicable provisions of the Companies Act 2013 and ListingRegulations. During FY 2018-19 there were no materially significant Related PartyTransactions by the Company with Promoters Directors Key Managerial Personnel or otherdesignated persons which may have a potential conflict with the interest of the Company atlarge.

During the FY 2018-19 there were no materially significant related party transactionsas defined under Section 188 of the Act and Regulations 23 the Listing Regulations andaccordingly transactions required to be reported in Form AOC-2 as per Section 188 of theCompanies Act 2013 is NIL.

III. INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY

Your Company has adequate internal financial controls and policies/procedures fororderly and efficient conduct of the business including safeguarding of assets preventionand detection of frauds and errors ensuring accuracy and completeness of the accountingrecords and the timely preparation of reliable financial information. The Audit Committeeevaluates the internal financial control system periodically.

Your Company has adopted accounting policies which are in line with the IndianAccounting Standards notified under Section 133 of the Companies Act 2013 read togetherwith the Companies (Indian Accounting Standards) Rules 2015. These are in accordance withGenerally Accepted Accounting Principles in India.

IV. EXTRACT OF THE ANNUAL RETURN

In accordance with recent amendments to the Companies Act 2013 (Act) Annual Return ofthe Company for Financial Year ended March 31 2019 as required under Section 92 of theAct will be available on the website of the Company www.shirpurgold.com.

V. SEXUAL HARASSMENT

The Company has zero tolerance for sexual harassment at workplace and adopted a policyon prevention prohibition and redressal of sexual harassment at workplace in line withthe provisions of the Sexual Harassment of Women at work place (Prevention Prohibitionand Redressal) Act 2013 and the Rules there under. During the year under review nocomplaint on sexual harassment was received by the Company.

VI. REGULATORY ORDERS

No significant or material orders were passed by the regulators or courts or tribunalswhich impact the going concern status and Company's operations in future.

VII. DEPOSITS & UNCLAIMED SHARES

Your Company has not accepted any public deposits and as such no amount on account ofprincipal or interest on public deposits under Section 73 of the Companies Act 2013 readwith Companies (Acceptance of Deposits) Rules 2014 was remained unpaid or unclaimed asat the end of the year 31st March 2019.

As at March 31 2019 your Company do not have any unclaimed shares / dividend hencethe provisions of the Investor Education and Protection Fund Rules are not applicable tothe company.

VIII. INSURANCE & RISK MANAGEMENT

The Company has obtained adequate insurance on all of it's fixed and other assets. TheCompany has identified the potential risks against the business of the Company and takingproper safeguards to mitigate / minimize the risks.

The detailed analysis of the Risk elements are discussed under the ‘Managementanalysis and Discussion Report'.

MANAGEMENT DISCUSSION AND ANALYSIS

The detailed analysis of the State of Company's affairs / developments is discussedunder Management Discussion and Analysis section of Directors' report.

HEALTH SAFETY & ENVIRONMENT PROTECTION

The Company is operating it's plant in a manner which endeavors protection of health /safety of workers and environment. The Company is using eco-friendly technology andmanufacturing facilities at it's plant to ensure workers safety and health. The‘Green' initiatives taken by the Company by plantation of trees at plant site are oneof the best examples of protecting environment. The Company is in compliance with all theapplicable labour and environmental laws.

PARTICULARS OF EMPLOYEES

The Company has maintained cordial relations with it's employees and workers. TheCompany has taken adequate steps to ensure safety and welfare of all it's employees atplant and other places. Requisite disclosures in terms of the provisions of Section 197 ofthe Act read with Rule 5 (1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed to this report. None of the employee of the Company isin receipt of remuneration of  Rs. .02 Crores per annum/ Rs. 8.50 Lacs per month ormore during the FY 2018-19. The information required under Rule 5(2) & 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 will beprovided upon request.

In compliance with provisions of section 136(1) of the Companies Act 2013 the AuditedFinancial Statements along with other reports are sent to every member of the Companyexcluding the information on employees' particulars which is available for inspection atthe Corporate Office of the company during working day (except Saturday) upto the date ofensuing Annual

General Meeting. Any member who is interested in obtaining copy thereof such membermay write to the Company Secretary.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO:

The information required u/s. 217(1)(e) of the Companies Act 1956 read with Rule 2 ofthe Companies (Disclosure of Particulars in the Report of Board of Directors) Rules 1988is furnished hereunder:

I. Energy Conservation and Technology Absorption:

Details of energy conservation technology absorption by the Company along with theinformation in accordance with the provisions of Section 134(3)(m) of the Companies Act2013 read with Rule 8(3) of the Companies (Accounts) Rules 2014 is annexed to thisreport.

II. Foreign Exchange Earning and Outgo:

Particulars of foreign currency earnings and outgo during the year are given in Note 37& 38 to Standalone Financial Statement.

ACKNOWLEDGEMENTS

We sincerely thank all our investors customers suppliers bankers business partners/associates financial institutions and government authorities for their continuedco-operation trust support and guidance. We also take this opportunity to express ourdeep appreciation for the contribution hard work dedication and commitment of all ouremployees who have been one of the major driving factors for the company's growth andprogress.

By order of the Board

Amit Goenka

Chairman

Place: Mumbai

Date: May 18 2019

.