The Board of Directors are pleased to present the Company's Thirty Sixth Annual Reportand the Company's audited financial statements for the financial year ended March 312021.
1. FINANCIAL PERFORMANCE
The audited financial statements of the Company as on March 31 2021 are preparedin accordance with the relevant applicable Ind AS and Regulation 33 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 ("SEBI Listing Regulations") and provisions of the Companies Act 2013("Act").
The summarized financial highlight is depicted below:
|Particulars ||2020-21 ||2019-20 |
|Sales & Other Income ||82881.23 ||88508.74 |
|Total Expenditure excluding finance cost & depreciation ||76459.01 ||81577.82 |
|Earning before Finance Cost Depreciation & Tax ||6422.22 ||6930.92 |
|Less: Finance Cost ||4623.81 ||4430.17 |
|Depreciation & Amortization Expenses ||793.43 ||787.59 |
|Profit before Tax and extraordinary items ||1004.98 ||1713.16 |
|Exceptional & Extraordinary items ||164.02 ||- |
|Profit before Tax ||1169.00 ||1713.16 |
|Current Tax ||(268.00) ||(486.00) |
|Deferred Tax ||427.79 ||75.56 |
|Tax Relating to Earlier Year Tax ||65.97 ||(123.49) |
|Profit (Loss) for the Year ||1394.77 ||1179.23 |
|Basic & Diluted Earnings Per Equity Shares of Face Value of Rs. 10/- each. (In Rs.) ||4.61 ||3.88 |
2. PERFORMANCE HIGHLIGHTS
The Company during the year under review has registered Total Income of Rs.82881.23lacs as against Rs. 88508.74 lacs in the previous year. The Company has earnedProfit Before Tax amounting to Rs. 1169.00 lacs during the year under review as againstRs. 1713.16lacsin the previous year. Net profit after tax for the current year is Rs.1394.77 lacs as compared to Rs. 1179.23 lacs in the previous year.
The company continues to retain and reinforce its market leadership in the allocatedsegments in which it operates. There are no material changes or commitments affecting thefinancial position of the company which have occurred between the end of the financialyear and the date of this report other than the impact of Covid-19 on business operationsof the company detailed in this report. The demand was affected due to COVID-I9 Pandemic.
THE COVID-19 PANDEMIC
India was hit hard by the second wave of the pandemic in April 2021. The stategovernments announced simultaneous lockdowns across the country. Major impact of Covid-19has been felt in the first quarter with both revenue and profit being affected. Withopening of domestic market post lockdown in June 2021 business prospects and performanceis expected to improve gradually from the second quarter of FY22 onwards.
As the country navigated through the crisis the Government and the Reserve Bank ofIndia took effective measures to support a robust economic recovery. The Union Budget 2021focused on regaining the growth momentum in the economy through several measures includingkeeping tax rates stable.
The agriculture sector performed well leading to a strong performance by ruralmarkets. The impact of Covid-19 was more pronounced in metros and bigger towns resultingin a slower recovery in urban markets.
The physical and emotional well being of employees continues to be a top priority forthe Company with several initiatives to support employees and their families during thepandemic. The office based employees sustained the practice of remote working/working fromhome with the help of adequate digital and other assistance and those working from plantsand other locations ensured undertaking utmost care and precaution at all times
Besides this no material changes and commitments have occurred after the close of theyear till the close of this Report which affects the financial position of the Company..
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 2020-21 subject to approval from the shareholder at the ensuing AGM. The payment offinal dividend is subject to the approval of the shareholders at the ensuing AnnualGeneral Meeting (AGM) of the Company.
The total outflow on account of equity dividend will be Rs.147.185 lacs.
In view of the changes made under the Income-tax Act 1961by the Finance Act 2020dividends paid or distributed by the Company shall be taxable in the hands of theShareholders. The Company shall accordingly make the payment of the final dividend afterdeduction of tax at source.
4. UNPAID/UNCLAIMED DIVIDEND
In terms of the provisions of Investor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2016/Investor Education and Protection Fund (Awarenessand Protection of Investors) Rules 2001 `no amount of unpaid/unclaimed dividends weretransferred during the year to the Investor Education and Protection Fund.
5. BOARD OF DIRECTORS a. Directors & Key Managerial Personnel
Re-appointments :In accordance with the Articles of Association of the Companyand Section 152 of The Companies Act2013 Mr. Saurabh Sangla (DIN: 00206069)Non-Executive Director is due to retire by rotation at the ensuing Annual General Meetingand being eligible offer himself for re-appointment.
b. Declaration from Directors: The Company has received the followingdeclarations from all the Independent Directors confirming that:
1. They meet the criteria of independence as prescribed under the provisions of theAct read with the Schedule and Rules issued thereunder and the Listing Regulations.There has been no change in the circumstances affecting their status as IndependentDirectors of the Company; and
2. They have registered themselves with the Independent Director's Database maintainedby the IICA.
None of the Directors of the Company are disqualified for being appointed as Directorsas specified in Section 164(2) of the Act and Rule
14(1) of the Companies (Appointment and Qualification of Directors) Rules 2014.
c. Number of meeting of Board of Directors
During the year under review 13 (Thirteen) meetings of the Board of Directors wereheld. The details of the meetings of the Board of Directors of the Company held andattended by the Directors during the financial year 2020-21 are given in the CorporateGovernance Report which forms part of this Annual Report. The maximum interval between anytwo meetings did not exceed 120 days as prescribed by the Act.
d. Familiarization programme for Independent 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 of which 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. Remuneration of Directors KeyManagerial Personnel and Senior Management
The remuneration paid to the Directors Key Managerial Personnel and Senior Managementis in accordance with the Nomination and
Remuneration Policy formulated in accordance with Section 178 of the Act and Regulation19read with Schedule II of the Listing Regulations. Further details on the same are givenin the Corporate Governance Report which forms part of this Annual Report.
The information required under Section 197 of the Act read with Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 in respect of Directors/employees ofthe Company is set out in the Annexure IX to this report.
g. Committees of the board
In accordance with the provisions of the Companies Act 2013 and SEBI (LODR)Regulations 2015 the Board has the following four (4)committees:
i). Audit Committee
ii). Nomination and Remuneration Committee
iii). Stakeholders' Relationship Committee
iv). Corporate Social Responsibility Committee
The Company has also constituted Internal Complain Committee (ICC) under the SexualHarassment of Women at the Workplace (Prevention Prohibition & Redressal) Act 2013.A detailed note on the Committees is provided in the Corporate Governance Report.
h. Director Responsibility Statement
Your Directors state that:
a) in the preparation of the annual accounts for the year ended March 31 2021 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 consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2021and of the profit ofthe Company 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 theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
a. Particulars of Loans Guarantees or Investments:
The Particulars of loans guarantees and investmentmade by the Company pursuant toSection 186 ofthe Companies Act 2013 are given in the Notes to theFinancial Statements..
b. Related Party Transactions
In line with the requirements of the Companies Act 2013and 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 placedbefore the Audit Committee for review and approval of the Committee on a quarterly basis.Also the Company has obtained prior omnibus approval for Related Party Transactionsoccurred during the year for transactions which are of repetitive nature and / or enteredin the ordinary course of business and are at 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.
7. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
The Company has complied with the provisions relating to the constitution of theInternal Complaint Committee in compliance with Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 to consider and resolve all sexualharassment complaints reported by women. During the year there is no complain regardingthe Sexual Harassment of Women at Workplace.
8. EXTRACTS OF ANNUAL RETURN
The Annual Return of the Company as on 31st March 2021in Form MGT - 9 in accordancewith Section 92(3) of the Act read with the Companies (Management and Administration)Rules 2014 is available on the website of the Company athttps://www.groipsignet.com.com/investors/MGT-9
9. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a whistle blower mechanism where in the employees can approach theManagement of the Company (Audit Committee in case where the concern involves the SeniorManagement) and make protective disclosures to the Management about unethical behaviouractual or suspected fraud or violation of the Company's Code of Conduct and InsiderTrading Code.
The Whistle Blower Policy requires every employee to promptly report to the Managementany actual or possible violation of the Code or an event an employee becomes aware of thatcould affect the business or reputation of the Company. The disclosures reported areaddressed in the manner and within the time frames prescribed in the policy. A mechanismis in place whereby any employee of the Company has access to the Chairman of the AuditCommittee to report any concern. No person has been denied access to the Chairman toreport any concern.
Further the said policy has been disseminated within the organisation and has alsobeen posted on the Company's website at
10. MANAGEMENT DISCUSSION AND ANALYSIS
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 I).
11. C O N S E R VA T I O N O F E N E R G Y 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 V).
12. CORPORATE SOCIAL RESPONSIBILITY
SIL has established CSR Committee as per the provision of the Companies Act 2013. CSR
Committee 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 III) in the report.
13. AUDITORS & THEIR REPORT
A. Statutory Auditors:
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.
B. Cost Auditors:
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 2021-22 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.
C. Secretarial Auditors:
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 year2020-21 has confirmed the compliances made by the Company except the matters theirin:
1. Non-compliance with the provisions of Regulation 17(1) of SEBI (LODR)Regulations 2015 regarding composition of Board of Directors during the Year under reviewand Fine of Rs. 536900/- and Rs.259600/- (inclusive of GST @ 18%) has been imposed bythe National Stock Exchange of India Limited and BSE Limited for the quarter ended 30thJune 2020 and 30th September 2020 respectively.
2. Form CRA-4 for filing of cost audit report Not Filed for the period underreview
The Report of the Secretarial Audit for the year 2020-21 in the Form MR-3 is annexedherewith as
d. Internal Auditors
In compliance with the provisions of Section 138of Companies Act 2013 read withCompanies(Accounts) Rules 2014 your Company has appointed Mr. Arpit Garg as InternalAuditors for the Financial Year 2021-22.
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.
14. CORPORATE GOVERNANCE
The report on Corporate Governance as stipulated under Regulation 34(3) read withSchedule V of the SEBI (LODR) Regulations 2015 along with the requisite certificate fromthe Practicing Company Secretary of the Company confirming compliance with the conditionsof the corporate governance is appended and forms a part of this report along with thecertificate of Disqualification of Directors received from Practicing Company Secretary asthe Annexure V and VIII of the Corporate Governance Report.
a. Material Changes And Commitments
There have been no material changes and commitments for the likely impact affectingfinancial position betweenend of the financial year and the date of the report except forthe impact arising out of the continuance of the COVID-19 pandemic which has risenexponentially in the second wave till the date of signing of this Report.
Please refer Note 52 of Notes to the standalone financial statements for furtherdetails in respect of impact of COVID-19 on the financial statements of the Company.
b. Change in the Nature of Business If Any
There was no change in the nature of business of the Company during the Financial Yearended 31st March 2021.
c. Secretarial Standards
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. Itis further stated that the Company does not have any deposits which are not in compliancewith the requirements of Chapter V of The Companies Act 2013.
16. PARTICULARS OF EMPLOYEES
The relation between the employees and the management has been cordial throughout theyear under review and the Directors place on record their appreciation for the efficientservices rendered by the employees at all levels.
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 2014are provided in separate annexure forming part of this Report as
The statement containing particulars of employees as required under Section 197 of theCompanies Act 2013read 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.
17. INTERNAL FINANCIAL CONTROL
According to Section 134(5) (e) of the 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 to ensure that internal controls are inplace
We would like to thank 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: 14.08.2021 || |