Your Directors are pleased to present before you the Twenty Seventh Annual Report andthe Audited Accounts of the company for the year ended March 31 2019.
PERFORMANCE OF THE COMPANY
Your company's financial results are summarized hereunder:
| || || |
(Amount in Rs. Lacs)
|Particulars ||Consolidated ||Standalone |
| ||2018-19 ||2017-18 ||2018-19 ||2017-18 |
|Income : || || || || |
|From Operations ||49961.83 ||44427.14 ||11329.5 ||7650.62 |
|Other ||86.07 ||170.39 ||27.78 ||36.85 |
|Total ||50047.90 ||44600.64 ||11357.28 ||7687.47 |
|Profit : || || || || |
|Profit Before Interest Depreciation and Taxation ||2522.86 ||2498.83 ||916.33 ||856.54 |
|Less: Interest ||816.47 ||1154.84 ||281.45 ||344.42 |
|Depreciation ||238.08 ||292.34 ||97.77 ||96.79 |
|Profit Before Exceptional item & Tax ||1468.11 ||1051.65 ||537.11 ||415.32 |
|Less: Item of Exceptional Nature ||379.83 ||0.00 ||379.83 ||0.00 |
|Profit Before Tax ||1088.28 ||1051.65 ||157.28 ||415.32 |
|Less: Provision for Tax (Including Deferred Tax and MAT Credit Entitlement) ||409.14 ||308.35 ||152.25 ||121.27 |
|Profit After Tax ||679.15 ||743.31 ||5.03 ||294.05 |
REVIEW OF OPERATIONS
Monsoon has direct impact on fertilizer industry too. During the year India receivedbelow normal south west monsoon and this certainly has impact on our business as well.Moreover introduction of Direct Benefit Transfer (DBT) by government has also affectedthe operations in past years. Nevertheless your company has managed to increase therevenue from operations in the last year. The rise in trading of agricultural productsduring the year has helped your company to add more value to the revenue from operations.
Your Company's Revenue from Operations for the year increased from Rs.7651 Lacs toRs.11330 Lacs last year. Recording an increase of 48.09%. The profit before interestdepreciation and tax grew to Rs.916.33 Lacs from Rs.856.54 Lacs in the previous financialyear. The net profit before exceptional item and tax for the year grew to Rs.537.11 Lacsfrom Rs.415.32 Lacs in the previous financial year i.e. an increase of 29.32%.
However Profit after tax recorded fall due to item of exceptional nature which stoodat Rs.379.83 Lacs affecting Earnings per share for the year. Excluding such exceptionalitem the EPS of your company for the financial year ended March 31 2019 was Rs.3.85 ascompared to Rs.2.94 for the previous financial year. The Earnings per share (EPS) afterexceptional item for the year stood at Rs.0.05 per share as compared to Rs. 2.94 pershare in previous year.
The company could achieve a consolidated turnover of Rs.49962 Lacs as compared toprevious year's Rs. 44430 Lacs and Net Profit Before Tax of Rs.1088 Lacs for the yearunder review as against the previous year's consolidated Net Profit Before Tax of Rs.1052Lacs.
Your company proposes to transfer an amount of Rs.2.02 Lacs to General Reserve.
The Board of Directors of your company after considering holistically the relevantcircumstances and keeping in view the company's dividend distribution policy has decidedthat it would be prudent not to recommend any Dividend for the year under review.s
CONSOLIDATED FINANCIAL RESULTS:
Consolidated Financial Statements incorporating the operations of the Company and itssubsidiaries is appended.
As required under the provisions of the Act a statement showing the salient featuresof the financial statements of the subsidiaries is enclosed as an Annexure A to thisReport.
However the Accounts of the Subsidiary Companies and the related information will bemade available to the Members of Shiva Global Agro Industries Limited and its SubsidiaryCompanies on request and will also be kept for inspection at the Registered Office of theCompany.
i) Shiva-Parvati Poultry Feed Private Limited:
The Company (a 51% subsidiary) achieved a total turnover of Rs.16938.69 Lacs and earnedRs.199.11 Lacs of Profits After Tax.
ii) Ghatprabha Fertilizers Private Limited
The Company (a 61.53% subsidiary) achieved a total turnover of Rs.4135.38 Lacs andearned Rs.68.53 Lacs of Profits After Tax.
iii) Shrinivasa Agro Foods Private Limited
The Company (a 51.01% subsidiary) achieved a total turnover of Rs.18258.22 Lacs andearned Rs.365.75 Lacs of Profits After Tax.
i) Kirtiman Agrogenetics Limited
The Company (a 26.97% associate) achieved a total turnover of Rs.1917.50 Lacs andearned Rs.-696.72 Lacs of Loss After Tax.
During the year the Company has sold 37.53% shares in Kirtiman Agrogentics Limited. TheCompany has incurred a loss of Rs.379.83 Lacs on transfer of shares & fair valuationof the balance shares held for sale which has been reflected as Exceptional item in theStatement of Profit & Loss. The investment in this company is disclosed in accordancewith provisions of Ind AS 105 Non-current Assets held for sale and DiscontinuedOperations.
Consequent to the transfer of shares as mentioned above investment in KirtimanAgrogentics Limited shown as subsidiary in the previous year has not been considered forconsolidation as at the year end.
RISK MANAGEMENT POLICY
The Company has constituted a Risk Management Committee. Details of constitution of theCommittee and its terms of reference are set out in the Report on Corporate Governance.The Company has formulated a Risk Management Policy under which various risks associatedwith the business operations are identified and the mitigation process are being taken up.
INTERNAL FINANCIAL CONTROL SYSTEMS
The Company has adequate Internal Financial Controls commensurate with the naturesize and complexity of the businesses and operations. These are routinely tested andcertified by Statutory as well as Internal Auditors. Significant audit observations andthe follow up action are reported to the Audit Committee.
RELATED PARTY TRANSACTIONS
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 were no materialsignificant related party transactions made by the Company with the Promoters DirectorsKey Managerial Personnel or the Senior Management which may have a potential conflict withthe interest of the Company at large.
All related party transactions were placed before the Audit Committee / Board forapproval. Prior approval of the Audit Committee was obtained for the transactions whichare foreseen and are in repetitive in nature. The related party transactions entered intoare reviewed by an independent audit firm to confirm that they were in the ordinary courseof business and at arm's length basis. The Company has formulated a policy for RelatedParty Transactions which has been approved by the Board and is placed on the website ofthe Company at www.shivaagro.org.
None of the Directors had any pecuniary relationship or transactions with the Companyexcept the payments made to them in the form of remuneration sitting fee and commission.
M/s Aditya Falor & Associates Chartered Accountants were appointed as Auditors ofthe Company for a period of five years from the conclusion of the Annual General Meetingheld on September 29 2016. As required under the provisions of Section 139 of the Act aresolution for the yearly ratification of their appointment is being placed before theshareholders for their approval.
The Auditor's Report given by M/s Aditya Falor & Associates Statutory Auditor'son the financial statements of the Company for the year ended March 31 2019 is part ofthe Annual Report. The Auditor's Report does not contain any qualification reservation oradverse remark. During the year under review the Auditors have not reported any matterunder Section 143(12) of the Act therefore no detail is required to be disclosed underSection 134(3)(ca) of the Act.
Pursuant to Section 148 of the Act read with The Companies (Cost Records and Audit)Rules 2014 as amended the cost records of the Company are required to be audited. Basedon the recommendations of the Audit Committee your Board has appointed the followingpracticing Cost Accountants Mr. Jayant B. Galande to audit the cost records of theCompany for the year 2019-20.
The Cost Audit Report for the year 2017-18 has been filed with Ministry of CorporateAffairs within the prescribed time limit as per the Act.
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board had appointed Mr. Pawan Kasatof M/s. PHK & Associates Practicing Company Secretaries to undertake the secretarialaudit of the Company for the financial year 2018-19.
The report of the Secretarial Auditor is enclosed as Annexure B and forms part of thisreport. The Secretarial Audit Report does not contain any qualification reservation oradverse remark.
PARTICULARS OF LOANS GUARANTEES & INVESTMENTS
Details of loans and guarantees given and investments made under Section 186 of the Actare given in the Notes to the Financial Statements.
PUBLIC FIXED DEPOSIT
Your Company is eligible to accept deposit from public pursuant to Section 73 of theCompanies Act 2013 ("the Act") and the Companies (Acceptance of Deposits)Rules 2014 ("the Rules"). Pursuant to the Special Resolution passed by themembers at the Annual General Meeting (AGM) of the Company held on September 30 2014 theBoard of Directors of the Company approved the Fixed Deposit Scheme for acceptance ofdeposits from Members in accordance with the requirements of the Act and the Rules.
The Company has accepted deposits of Rs.42.28 Lacs during the year under review andtotal Rs.113.60 Lacs were outstanding as on March 31 2019. There were no defaults inrespect of repayment of any deposits or payment of interest thereon during the year underreview.
The Company has not accepted any deposits which are not in compliance with therequirements of the Act. The Company has no overdue deposits as at the end of the yearunder review.
In accordance with Section 152 of the Companies Act 2013 Mr.Omprakash Gilda isretiring at the ensuing Annual General Meeting and being eligible offer himself forre-appointment.
Mrs. Sandhya Satish Maheshwari was appointed as an Independent Director of the Companyfor a period of 5 years w.e.f. September 30 2014 and his current term ends on September29 2019. Section 149 of the Act provides that an independent Director shall hold officefor a term up to two term on the Board of a company but after expiry of first term offive years shall be eligible for reappointment on passing of a special resolution by thecompany. Board has recommended her reappointment as an Independent Director of theCompany. Accordingly a special resolution proposing the reappointment of Mrs. SandhyaSatish Maheshwari as an Independent Director of the Company for a period from September30 2019 to September 29 2024 is being placed before the shareholders for their approval.
All the Independent Directors of the Company have given declarations under sub-section(6) of Section 149 of the Act and the same have been considered and taken on record bythe Board.
In accordance with the provisions of Section 134 of the Act and Regulation 17 of theListing Regulations the Board has carried out evaluation of its own performance theperformance of Committees of the Board namely Audit Committee Risk ManagementCommittee Stakeholders Relationship Committee & Nomination and RemunerationCommittee and also the Directors individually. The manner in which the evaluation wascarried out & the process adopted has been mentioned in the Corporate GovernanceReport.
NUMBER OF BOARD MEETINGS
A calendar of meetings is prepared and circulated in advance to the Directors. Duringthe year 2018-19 Four Board Meetings were held the details of which are given in theReport on Corporate Governance.
The Audit Committee comprises of Mr. Deepak S. Maliwal Chairman Mr. Divakar N. Shettyand Mrs. Sandhya S. Maheshwari. All the recommendations made by the Audit Committee wereaccepted by the Board.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
On their appointment Independent Directors are familiarized about the Company'soperations and businesses. Interaction with the Business Heads and key executives of theCompany is also facilitated. Detailed presentations on the business of each of theDivision are also made to the Directors. Direct meetings with the Chairman and theManaging Director are further facilitated for the new appointee to familiarize him/herabout the Company/its businesses and the group practices.
The role rights duties and responsibilities of Independent Directors have beenincorporated in the Letters of Appointment issued to them. The amendments / updates instatutory provisions are informed from time to time. The details of familiarisationprogramme as above are also disclosed on the Company's website at www.shivaagro.org.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 (3) (c) and 134(5) of the Companies Act 2013the Board of Directors of Shiva Global Agro Industries Limited make the followingstatements to the best of their knowledge & belief & according to the information& explanations obtained by them: a) That in the preparation of the annual financialstatements for the year ended March 31 2019 the applicable accounting standards havebeen followed and there have been no material departures therefrom; b) That the accountingpolicies mentioned in Notes forming part of the Financials Statements have been selectedand applied consistently and judgments and estimates have been made that are reasonableand prudent so as to give a true and fair view of the state of affairs of the Company asat March 31 2019 and of the profits of the Company for the year ended on that date; c)That proper and sufficient care has been taken for the 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)That the annual financial statements have been prepared on a going concern basis; e) Thatproper internal financial controls have been laid down to be followed by the Company andsuch internal financial controls are adequate and operating effectively; f) That propersystems are in place to ensure compliance with the provisions of all applicable laws andsuch systems are adequate and operating effectively.
KEY MANAGERIAL PERSONNEL
Mr. Omprakash K. Gilda Managing Director Mr. Umesh O. Bang Chief Financial Officerand Mrs. Rashmi G. Agrawal Company Secretary are the Key Managerial Personnel (KMP) ofthe Company.
PARTICULARS OF EMPLOYEES
A table containing the particulars in accordance with the provisions of Section 197(12)of the Act read with Rule 5(1) & (2) of the Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 is appended as Annexure C to this Report.
The Company has no Employees whose salary exceeds the limits prescribed under Rule 5(2)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. Salient features of the Remuneration Policy are set out in the Report onCorporate Governance.
PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE POLICY
The Company has in place a Prevention of Sexual Harassment Policy in line with therequirements of the Sexual
Harassment of Women at Work place (Prevention Prohibition and Redressal) Act 2013(Act). An Internal Compliance Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees are covered under this Policy. Duringthe year 2018-19 there were no complaints received by the ICC.
EXTRACT OF THE ANNUAL RETURN
In accordance with Section 134(3)(a) of the Act an extract of the Annual Return in theprescribed format is appended as Annexure D to this Report.
WHISTLE BLOWER POLICY
The Company believes in the conduct of the affairs of its constituents in a fair andtransparent manner by adopting the highest standards of professionalism honestyintegrity and ethical conduct. The Company has a Whistle Blower Policy which provides theemployees customers vendors and directors an avenue to raise concerns on ethical andmoral standards and legal provisions in conduct of the business operations of the Company.The Whistle Blower Policy is also placed on the website of the Company atwww.shivaagro.org.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Act readwith Rule 3 of the Companies (Accounts) Rules 2014 are detailed below.
A) CONSERVATION OF ENERGY:
The company has taken various measures for its energy conservation as detailed below;
Small Group Activity teams have been constituted to constantly look at theenergy conservation other improvement schemes which has resulted in considerable energysavings.
Energy efficient Lighting - LED Lighting replaced compact fluorescent lampsfluorescent tube lights in Administrative Building & Storage Godowns.
Replacement of old motors and pumps with high efficient pumps and motors.
Measures for Reduction in power consumption undertaken with installation of newenergy efficient motors and gear box.
B) TECHNOLOGY ABSORPTION:
Company has fully absorbed the technology to manufacturing Single SuperPhosphate (SSP) with an installed capacity of 400 TPD.
The plant has been operated at its full efficiency level.
Enhanced flexibility in use of raw materials.
C) FOREIGN EXCHANGE EARNINGS AND OUTGO:
The Foreign Exchange outgo on account of purchase of raw materials is Rs.1828.93 Lacs.(Previous year Rs.1753.64 Lacs)
SAFETY HEALTH AND ENVIRONMENT (SHE):
Company's focus on Safety Health & Environment continued during the year underreview across all locations with all manufacturing plants maintaining high safetystandards. Your Company maintained high standards of environmental performances with allfacilities operating well within norms. The overall safety environment continued toimprove during the year under review. To improve Environmental Management reportingadvanced emission monitoring equipment were installed and maintained at the sites.
The Company is committed to maintain high standards of Corporate Governance. Asstipulated under the requirements of the Listing Agreement with Stock Exchanges a reporton Corporate Governance duly audited is appended as Annexure E for information of theMembers. The requisite certificate from the Auditors of the Company confirming compliancewith the conditions of Corporate Governance is attached to the Report on CorporateGovernance Annexure E (ii).
MANAGEMENT DISCUSSION AND ANALYSIS
A report on Management Discussion and Analysis which forms part of this Annual Reportinter-alia deal with the operations as also current and future outlook of the company isfurnished separately.
MATERIAL SUBSIDIARY POLICY
The Company has adopted a policy for determining material subsidiary in line with therequirements of the Listing Regulations. The Policy on Material Subsidiary is available onthe website of the Company at www.shivaagro.org.
COMPLIANCE OF SECRETARIAL STANDARDS
The Company has complied with the Secretarial Standards issued by The Institute ofCompany Secretaries of India and approved by the Central Government.
The Directors acknowledge and would like to place on record the commitment anddedication on the part of the employees of your Company for their continued efforts inachieving good results in an adverse situation.
The Directors also wish to acknowledge and record their appreciation of the continuedsupport and assistance received by the Company from Union Bank of India and other Banksfinancial institutions as well as from various Government bodies both at the Centre andthe State.
| ||For and on behalf of the Board of Directors |
|Place : Nanded ||Omprakash K. Gilda |
|Dated : May 30 2019 ||Managing Director |
Statement showing salient features of the financial statements of subsidiaries andjoint ventures and associates as per the Companies Act 2013
|Part "A" : Subsidiaries || || ||(Rs. in Lacs) |
|Name of Subsidiary ||Ghatprabha Fertilizers Private Limited ||Shiva-Parvati Poultry Feed Private Limited ||Shrinivasa Agro Foods Private Limited |
|Share Capital ||278.33 ||450.00 ||923.10 |
|Reserves and Surplus ||1248.79 ||1539.62 ||1798.82 |
|Total Assets ||3788.48 ||5629.77 ||4217.81 |
|Total Liabilities ||2261.36 ||3640.15 ||1495.89 |
|Details of Investments || || || |
|Investments in Equity Shares ||- ||1.35 ||- |
|Investments in Mutual Funds ||- ||5.40 ||- |
|Turnover ||4135.38 ||16938.69 ||18258.22 |
|Profit/(Loss) Before Taxation ||93.13 ||281.62 ||515.52 |
|Provision for Taxation ||24.60 ||82.51 ||149.77 |
|Profit After Taxation ||68.53 ||199.11 ||365.75 |
|Proposed Dividend ||- ||- ||- |
|% of shareholding ||61.53% ||51.00% ||51.00% |
1. There are no subsidiaries which are yet to commence operations.
2. During the year the company has sold its investment in M/s Kirtiman AgrogeneticsLimited.
|Part "B" : Associates || |
|Name of Associate ||Kirtiman Agrogenetics Limited |
|Latest audited balance sheet date ||31/03/2019 |
|Number of shares held by the Company ||359300 |
|Amount of investment (Rs. in lacs) ||431.81 |
|% of shareholding ||26.97% |
|Networth attributable to the Company (Rs. in lacs) ||257.09 |
|Profit/ (loss) for the year : || |
|i. Considered in consolidation (Rs. in lacs) ||- |
|ii. Not considered in consolidation (Rs. in lacs) ||-696.72 |
1. There are no associates which are yet to commence operations.
2. There are no associates which have been liquidated or sold during the year.
A.The details of remuneration during the year 2018-19 as per Rule 5(1) of the Companies(Appointment & Remuneration of Managerial Personnel) Rules 2014 are as follows:
i. Ratio of Remuneration of each Director to the median remuneration of the employeesof the Company for the financial year:
|Sr. No. ||Name of the Director ||Designation ||Ratio of the remuneration to the median remuneration of the employees |
|1. ||Mr. Omprakash K. Gilda ||Executive & Managing Director ||Nil |
|2. ||Mr. Arunkumar R. Toshniwal ||Non Executive Director ||Nil |
|3. ||Mr. Deepak S. Maliwal ||Non Executive Director ||Nil |
|4. ||Mr. Narayanlal P. Kalantri ||Non Executive Director ||Nil |
|5. ||Mr. Vijayprakash O. Agrawal ||Non Executive Director ||Nil |
|6. ||Dr. Santosh H. Malpani ||Independent Director ||Nil |
|7. ||Mr. Divakar N. Shetty ||Independent Director ||Nil |
|8. ||Mrs. Sandhya S. Maheshwari ||Independent Director ||Nil |
ii. Percentage increase in the remuneration of each Director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year:
|Sr. No. ||Name of the Director ||Designation ||% increase in remuneration in the financial year |
|1 ||Mr. Omprakash K. Gilda ||Executive & Managing Director ||Nil |
|2 ||Mr. Arunkumar R. Toshniwal ||Non Executive Director ||Nil |
|3 ||Mr. Deepak S. Maliwal ||Non Executive Director ||Nil |
|4 ||Mr. Narayanlal P. Kalantri ||Non Executive Director ||Nil |
|5 ||Mr. Vijayprakash O. Agrawal ||Non Executive Director ||Nil |
|6 ||Dr. Santosh H. Malpani ||Independent Director ||Nil |
|7 ||Mr. Divakar N. Shetty ||Independent Director ||Nil |
|8 ||Mrs. Sandhya S. Maheshwari ||Independent Director ||Nil |
|9 ||Mr. Umesh O. Bang ||Chief Financial Officer ||15.35% |
|10 ||Mrs. Rashmi Agrawal ||Company Secretary ||Nil |
iii. Percentage increase/(decrease) in the median remuneration of employees in thefinancial year 19.76%
iv. Number of permanent employees on the rolls of the company as on March 31 2019 92
v. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
The company is not paying any managerial remuneration.
vi. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company is in compliance with its remuneration policy.
B. The details of top ten employees in terms of remuneration drawn during the financialyear 2018-19 as per Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 duly amended by the Companies (Appointment & Remuneration ofManagerial Personnel) Amendment Rules 2016 are as follows:
|Sr. No. ||Name of the employee ||Designation ||Remuneration Received |
| || || ||Rs. In Lacs. |
|1 ||Ajay Rakesh Sharma ||Marketing Manager ||8.80 |
|2 ||Umesh Omprakash Bang ||Chief Financial Officer ||8.25 |
|3 ||Udaiban Pratap Singh ||Factory Manager ||7.62 |
|4 ||Dinkar Rajaram Mahajan ||Personnel Manager ||7.50 |
|5 ||Vijay Vitthalrao Rakhewar ||Sr. Accounts Manager ||4.54 |
|6 ||Govind Santoshrao Deore ||Area Manager (Aurangabad) ||4.20 |
|7 ||Gopikishan Devkaran Sharma ||Area Manager (Nanded) ||4.20 |
|8 ||Gorakshnath Raghunath Ghadge ||Area Manager (Latur) ||3.70 |
|9 ||Amit Kumar Shukla ||Area Manager (Nagpur) ||3.56 |
|10 ||Santosh Marotrao Mahulkar ||Area Manager (Amravati) ||3.50 |