The Board of Directors are pleased to present the Company's Thirty Fourth Annual Reportand the Company's audited financial statements for the financial year ended March 312019.
The Company's financial performance for the year ended March 312019 is summarizedbelow:
(rs ;n lacs)
|Particulars ||2018-19 ||2017-18 |
|Sales & Other Income ||97805.94 ||91152.95 |
|Total Expenditure Excluding Finance Cost & Depreciation ||90514.76 ||83824.32 |
|Earning before Finance Cost Depreciation & Tax ||7291.18 ||7328.63 |
|Less: Finance Cost ||4358.97 ||4095.87 |
|Depreciation & Amortization Expenses ||729.86 ||661.14 |
|Profit before Tax and extraordinary items ||2202.35 ||2571.62 |
|Exceptional & Extraordinary items ||- ||- |
|Profit before Tax ||2202.35 ||2571.62 |
|Current Tax ||(650.00) ||(695.00) |
|Deferred Tax ||(179.41) ||(29.29) |
|Tax Relating to Earlier Year Tax ||- ||- |
|Profit (Loss) for the Year ||1372.94 ||1847.34 |
|Basic & Diluted Earnings Per Equity Shares of Face Value of Rs. 10/- each. (In Rs.) ||4.54 ||6.15 |
2.OVERVIEW OFTHE FINANCIAL PERFORMANCE
The Company during the year under review has registered Total Income of Rs. 97805.94lacs as against Rs. 91152.95 lacs in the previous year. The Sale in Manufacturing Segmentincreased to Rs. 413.87 Cr. during the financial year 18-19 as against Rs. 328.25 Cr. inthe previous year. However the trading sales reduced to Rs. 560.84 Cr. during thefinancial year 1819 as against Rs. 576.26 Cr. in the previous year. The Company has earnedProfit Before Tax amounting to Rs. 2202.35 lacs during the year under review as againstRs. 2571.62 lacs in the previous year. Net profit after tax for the current year is Rs.1372.94 lacs as compared to Rs. 1847.34 lacs in the previous year.
The Board considering the Company's performance and financial position for the yearunder review recommended a dividend pay-out of Rs. 0.5 per equity shares for the yearended 2018-19 subject to approval from the shareholder at the ensuing AGM.
Together with the Dividend distribution tax the total outflow on account of equitydividend will be Rs. 177.44 Lacs
The dividend on equity shares if approved at the Annual General meeting will bepayable to those shareholders whose name appear on the Company's Register of member.
4.BOARD OF DIRECTORS
a.Directors & Key Managerial Personnel
Appointments: The Company on recommendation of Nomination and Remuneration Committeeand in its Board Meeting dated 23rd May 2018 had appointed Mr. Mayank Shrivas (DIN:08102022) as an Additional Director under Independent category of the Company with effectfrom 23rd May 2018 for a period of 5 years not liable to retire by rotation.
The Company has also on recommendation of Nomination and Remuneration Committee and inits Board Meeting dated 7th August 2019 had appointed Mr. Sanjay Chourey (DIN: 08523962)as an Additional Director under Independent category of the Company with effect from 7thAugust 2019 for a period of 5 years not liable to retire by rotation.
Re-appointments : In accordance with the Articles of Association of the Company andSection 152 of The Companies Act2013 Mr. Saurabh Sangla (DIN: 00206069) Non-ExecutiveDirector is due to retire by rotation at the ensuing Annual General Meeting and beingeligible offer himself for re-appointment.
Cessations: During the year under review Mr. Akhilesh Gupta has ceased to be a Directorof the Company w.e.f. 25th July 2018. The Board places on record its appreciation towardsvaluable contribution made by Mr. Akhilesh Gupta during his tenure as a Director of theCompany.
The tenure of Ms. Nishtha Neema Independent Women Director of the Company will alsoexpire on 30.09.2019 and shall not be reappointed.
b.Number of meeting of Board of Directors
The Board of Directors met ten (10) times during the Financial Year under review viz.15.04.2018
23.05.201802.07.2018 02.08.2018 11.08.2018
15.08.201805.11.2018 31.01.2019 27.02.2019 and
12.03.2019The maximum gap between any 2 meetings did not exceed 120 days.
c.Independent Directors and their Meeting
Your Company has received annual declarations from all the Independent Directors of theCompany confirming that they meet with the criteria of Independence provided in Section149(6) of the Companies Act 2013 and Regulations 16(1)(b) & 25 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and there has been no change inthe circumstances which may affect their status as Independent Director during the year.
The Independent Directors met on 11th February 2019 without the attendance ofNon-Independent Directors and members of the Management. The Independent Directorsreviewed the performance of Non-Independent Directors and the Board as a whole; theperformance of the Chairman of the Company taking into account the views of ExecutiveDirectors and Non-Executive Directors and assessed the quality quantity and timeliness offlow of information between the Company Management and the Board that is necessary for theBoard to effectively and reasonably perform their duties.
d.Familiarization programme for Directors
The Company conducts Familiarization Programme for the Independent Directors to enablethem to familiarize with the Company its Management and its operations so as to gain aclear understanding of their roles rights and responsibilities for the purpose ofcontributing significantly towards the growth of the Company. They are given fullopportunity to interact with Senior Management Personnel and are provided with all thedocuments required and/or sought by them to have a good understanding of the Company itsbusiness model and various operations and the industry ofwhich it is a part.
e.Performance Evaluation of Board Committee and Directors
In accordance with applicable provisions of The Companies Act 2013 and ListingRegulations the evaluation of the Board as a whole committees and all the Directors wasconducted as per the internally designed evaluation process approved by the Board. Theevaluation process inter alia considers attendance of Directors at Board and committeemeetings acquaintance with business communicating inter se board members effectiveparticipation domain knowledge compliance with code of conduct vision and strategy. Theevaluation tested key areas of the Board's work including strategy business performancerisk and governance processes. The evaluation considers the balance of skills experienceindependence and knowledge of the management and the Board its overall diversity andanalysis of the Board and its Directors' functioning.
The report on performance evaluation of the Individual Directors was reviewed by theChairman of the Board and feedback was given to Directors.
f.Audit Committee & Composition
The Audit Committee comprises Independent Directors namely Ms. Nishtha Neema(Chairman) Mr. Mukesh Sangla Mr. Akhilesh Gupta Ms. Palak Malviya Mr. Mayank Shrivasas members.
g.Director Responsibility Statement
Your Directors state that:
a)in the preparation of the annual accounts for the year ended March 31 2019 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b)the Directors had selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at March 31 2019 and of the profit of theCompany for the year ended on that date;
c)the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d)the Directors had prepared the annual accounts on a going concern' basis;
e)the Directors had laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and are operating effectively; and
f)The Directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
a.Particulars of Loans Guarantees or Investments:
The particulars of loans guarantees and investments as on 31st March 2019 are coveredunder the provisions of Section 186 of The Companies Act2013 is given in the Notes toFinancial statements of the Company.
b.Related Party Transactions
In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onhttp://www.groupsignet.com/investors/policy . All
Related Party Transactions are placed before the Audit Committee for review andapproval of the Committee on a quarterly basis. Also the Company has obtained prioromnibus approval for Related Party Transactions occurred during the year for transactionswhich are of repetitive nature and / or entered in the ordinary course of business and areat arm's length.
All the related party transactions entered into during the financial year were on anarm's length basis and were in the ordinary course of business. Your Company had notentered into any transactions with related parties which could be considered material interms of Section 188 of the Companies Act 2013. Accordingly the disclosure of relatedparty transactions as required under Section134(3)(h) of the Companies Act 2013 in FormAOC 2 is not applicable.
6.SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION. PROHIBITION AND REDRESSAL) ACT2013
The Company has complied with the provisions relating to the constitution of theInternal Complaint Committee (ICC) in compliance with Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 to consider and resolve allsexual harassment complaints reported by women. During the year there is no complainregarding the Sexual Harassment of Women at Workplace.
7.EXTRACTS OF ANNUAL RETURN
The extract of Annual Return as on March 31 2019 in the prescribed Form No. MGT-9pursuant to Section 92 of the Companies Act 2013 is available on the website of theCompany at the link
https://www.groupsignet.com/extract-of-annual- return.pdf (Annexure I)
8.VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a whistle blower policy and has established the necessary vigilmechanism for employees and Directors to report concerns about unethical behaviour. Noperson has been denied access to the Chairman of the Audit Committee. The said policy isuploaded on the website of the Company at http://www.groupsignet.com/investors/policies
9.MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis forms an integral part of this Report and givesdetail of the overall industry structure developments performance and state of affairsof the Company's various businesses viz. the decorative business internationaloperations industrial and home improvement business internal controls and theiradequacy risk management systems and other material developments during the financialyear (Annexure II).
10.CONSERVATION OF ENERGY. TECHNOLOGY
ABSORPTION. FOREIGN EXCHANGE EARNINGS AND OUTGO:
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 withRule 8 of the Companies (Accounts)Rules 2014 as amended from time to time is annexed tothis Report as (Annexure - III.)
11.CORPORATE SOCIAL RESPONSIBILITY
SIL has established CSR Committee as per the provision of the Companies Act 2013. CSRCommittee recommends CSR activities to be undertaken by the Company to the Board asspecified in Schedule VII of the Companies Act 2013 ( here in after referred to as"the Schedule VII"). SIL will spend in every Financial Year at least 2 percent of the average net profits of the Company made during the 3 immediately precedingFinancial Years in pursuance of the Companies Act 2013 and rules framed there under forthe purposes specified in Schedule VII and also in pursuance of this CSR Policy. Thedetails of the same are attached as (Annexure IV) in the report.
12.AUDITORS & THEIR REPORT
M/s. SMAK & Co. Chartered Accountants having ICAI Registration No. 020120C wereappointed as Auditors of the Company for a term of 5 (five) consecutive years at theAnnual General Meeting held on 26th September 2017. They have confirmed that they are notdisqualified from continuing as Auditors of the Company.
The Notes on financial statement referred to in the Auditors ' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation adverse remark or disclaimer.
Pursuant to provisions of Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Rules 2014 amended from time to time the Company hasappointed Cost Auditor M/s A. K. Jain & Associates for the year 2018-19 on the totalremuneration of Rs.60000/- and has filed the Form CRA-2 to the Registrar Your directorspropose to approve their remuneration at the forthcoming Annual General Meeting.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s M. Maheshwari & Associates Company Secretaries to undertake theSecretarial Audit of the Company. The Secretarial Auditors in their report for the year2018-19has confirmed the compliances made by the Company except the matters stated below:
|Sr. Compliance No Requirement Regulations/ circulars / guidelines including specific clause) ||Deviations ||Observations/ Remarks of the Practicing Company Secretary |
|1. Clause 4 of Schedule B of SEBI (Prohibition of Insider Trading) Regulations 2015. Designated Person and their immediate relatives shall not trade during the period of closure of the trading window. ||Mr. Mukesh Sangla the Managing Director of the Company has purchased 114 shares on 22.01.2019 by oversight i.e. after the closure of trading window from 22.01.2018 to 02.02.2019. ||Mr. Mukesh Sangla rectified the wrongful purchase by selling those 114 shares in the open market immediately on next early trading day i.e on 23.01.2019. |
2. Company has not filed E-form MGT 14 for filing of resolution with respect to BoardReport as approved by the Board of Directors.
3. Company has not made the necessary expenditure on any CSR Activity as per section135 of Companies Act 2013.
The Report of the Secretarial Audit for the year 201819 in the Form MR-3 is annexedherewith as (Annexure V).
In compliance with the provisions of Section 138of Companies Act 2013 read withCompanies (Accounts) Rules 2014 your Company has appointed M/s S. K. Malani & Co.Chartered Accountants as Internal Auditors for the Financial Year 2018-19.
e.Reporting of Fraud by auditors
During the year under review neither the statutory auditor nor the secretarial auditorhas reported to the audit committee under Section 143 (12) of the Companies Act 2013any instances of fraud committed against the Company by its officers or employees thedetails of which would need to be mentioned in the Board's report.
13. CORPORATE GOVERNANCE
Corporate Governance is an ethically driven business process that is committed tovalues aimed at enhancing an organizations brand and reputation. The Companies Act 2013and amended SEBI (Listing obligation and Disclosure Requirements) Regulation 2015 havestrengthened the governance regime in the country. The Company is in compliance with thegovernance requirements provided under the new law and had proactively adopted manyprovisions of the new law ahead of time. The Company is committed to maintain the higheststandards of corporate governance and adhere to the corporate governance requirements setout by SEBI. Integrity and transparency are key to our corporate governance practices toensure that we gain and retain the trust of our stakeholders at all the times.
A separate report on Corporate Governance (Annexure VI) is provided together with aCertificate from the Statutory Auditors of the Company regarding compliance of conditionsof Corporate Governance as stipulated under SEBI (Listing obligation and DisclosureRequirements) Regulation 2015 (Annexure VII). A Certificate of the MD and CFO of theCompany inter alia confirming the correctness of the financial statements and cash flowstatements adequacy of the internal control measures and reporting of matters to theAudit Committee is also annexed. (Annexure VIII).
a.Material Changes And Commitments
The Company has consolidated face value of Shares from Rs. 1 per share to Rs. 10 pershare and has complied with all the necessary provisions. Other than this There have beenno material changes and commitments affecting the financial position of the Companybetween the end of the financial year and date of this report.
b.Change in the Nature of Business If Any
There was no change in the nature of business of the Company during the F inancial Yearended 31 stMarch 2019.
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2 relatingto Meetings of the Board of Directors' and General Meetings' respectivelyhave been duly followed by the Company.
d.Significant and Material orders passed by the Regulators or Courts or Tribunalsimpacting the going concern status of the Company:
There are no significant and material orders passed by the Regulators / Courts /Tribunals which would impact the going concern status of the Company and its futureoperation
e.Details of Fixed Deposits
During the year under review the Company has not accepted any Deposit under Section 73of The Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.It is further stated that the Company does not have any deposits which are not incompliance with the requirements of Chapter V of The Companies Act 2013.
15.PARTICULARS OF EMPLOYEES
The information required under Section 197 of the Companies Act 2013 read with rule5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 areprovided in separate annexure forming part of this Report as (Annexure - IX.)
The statement containing particulars of employees as required under Section 197 of theCompanies Act 2013 read with rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 will be provided upon request. In terms of Section 136of the Companies Act 2013 the Report and Accounts are being sent to the Members andothers entitled thereto excluding the information on employees' particulars which isavailable for inspection by the members at the Registered Office of the Company duringbusiness hours on working days of the Company. If any member is interested in obtaining acopy thereof such Member may write to the Company Secretary in this regard.
16.INTERNAL FINANCIAL CONTROL
According to Section 134(5) (e) ofthe Companies Act 2013 the term Internal FinancialControl (IFC) means the policies and procedures adopted by the company for ensuring theorderly and efficient conduct of its business including adherence to company's policiessafeguarding of its assets prevention and detection of frauds and errors accuracy andcompleteness of the accounting records and timely preparation of reliable financialinformation.
The Company has adequate system of internal controls to ensure that all the assets aresafeguarded and are productive. Necessary checks and controls are in place to ensure thattransactions are properly verified adequately authorized correctly recorded and properlyreported. The Internal Auditors of the Company conducts Audit of various departments toensure that internal controls are in place
We would like to thank to all our Stakeholders viz. Shareholders Investors Bankerscustomers suppliers Government agencies stock exchanges and depositories Auditorslegal advisors consultants business associates service providers for their continuedcommitment and invincible enthusiasm which made this year productive and pleasurable.
The Board also places on record their deep sense of appreciation towards all itsEmployees at all levels for adopting the values of the Company and their hard work duringthe year.
| ||By Order of Board |
| ||For Signet Industries Limited |
| ||Mukesh Sangla |
| ||Chairman and Managing Director DIN : 00189676 |
|Place: Indore || |
|Date: 07th August 2019 || |