Sikko Industries Ltd.
|BSE: 538419||Sector: Agri and agri inputs|
|NSE: SIKKO||ISIN Code: INE112X01017|
|BSE 05:30 | 01 Jan||Sikko Industries Ltd|
|NSE 05:30 | 01 Jan||Sikko Industries Ltd|
|BSE: 538419||Sector: Agri and agri inputs|
|NSE: SIKKO||ISIN Code: INE112X01017|
|BSE 05:30 | 01 Jan||Sikko Industries Ltd|
|NSE 05:30 | 01 Jan||Sikko Industries Ltd|
The Board of Directors hereby submits the report of the business and operations of yourCompany along with the Audited Financial statements for the financial year ended March31 2020.
FINANCIAL HIGHLIGHTS (Amount in Rs.)
During the year under review the Company has earned total income of Rs. 3252.02 Lakhsas against the total income of Rs. 2739.61 Lakhs of previous year which states 18.70%increase in the turnover as compared to previous year. The profit before tax in thefinancial year 2019-20 stood at Rs. 340.98 Lakhs as compared to profit of Rs. 253.63 Lakhsfor last year and net profit after tax stood at Rs. 243.53 Lakhs compared to profit of Rs.200.77 Lakhs for the previous year which state 21.30% increase in profit of the Company.
IMPACT OF COVID-19 PANDEMIC
Being falling under essentials goods Sector Company (i.e. Agriculture products) thereis no impact on revenues and the profitability of the Company and the business is runningnormally .
Your Directors wish to conserve resources for future expansion and growth of theCompany. Hence no Dividend has been declared by the Directors during the Financial Year2019-20.
AMOUNT TRANSFERRED TO RESERVES
Your Directors do not propose transfer of any amount to the General Reserves. Fullamount of net profit is carried to reserve & Surplus account of the Company.
CHANGE IN THE NATURE OF BUSINESS
During the year there was no change in the nature of business carried out by theCompany.
During the year under review no changes took places in the Authorized and Paid-upshare capital of the Company. Authorized Capital The Authorized Capital of the Company isRs. 60000000/- divided into 6000000 Equity Shares of Rs. 10/- each. Issued Subscribed& Paid-Up Capital The present Paid-up Capital of the Company is Rs. 56000000/-divided into 5600000 Equity Shares of Rs. 10/-.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board of the Company comprises of five Directors out of which three are PromoterDirectors and two are Non-Promoter Independent Directors. As on the date of this reportthe Board comprises following Directors:
The composition of Board complies with the requirements of the Companies Act 2013("Act"). Further in pursuance of Regulation 15(2) of SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 ("Listing Regulations") theCompany is exempted from requirement of having composition of Board as per Regulation 17of Listing Regulations. None of the Directors of Board is a member of more than tenCommittees or Chairman of more than five committees across all the Public companies inwhich they are Director. The necessary disclosures regarding Committee positions have beenmade by all the Directors. None of the Director of the Company is serving as a Whole-TimeDirector or Managing Director in any Listed Company and is holding position of IndependentDirector in more than 3 Listed Company and none of the Director of the Company is holdingposition as Director in more than eight listed entities and none of the Director isserving as Independent Director in more than 7 Listed Company. None of the Directors ofthe Company is disqualified for being appointed as Director as specified in Section 164(2) of the Companies Act 2013.
DISCLOSURE BY DIRECTORS:
The Directors on the Board have submitted notice of interest under Section 184(1) i.e.in Form MBP 1 intimation under Section 164(2) i.e. in Form DIR 8 and declaration as tocompliance with the Code of Conduct of the Company.
During the year under review the Board of Directors of the Company met 6 (Six) timesviz. on April 04 2019 May 27 2019 September 05 2019 October 18 2019 November 142019 and March 10 2020. The gap between two consecutive meetings was not more than onehundred and twenty days as provided under section 173 of the Act. The details ofattendance of each Director at the Board Meeting and Annual General Meeting are givenbelow:
In terms of Section 149 of the Companies Act 2013 and rules made there under theCompany has two Non-Promoter Non-Executive Independent Directors in line with the act. Aseparate meeting of Independent Directors was held on March 10 2020 to review theperformance of Non-Independent Directors and Board as whole and performance of Chairpersonof the Company including assessment of quality quantity and timeliness of flow ofinformation between Company management and Board.
The Company has received necessary declaration from each independent director underSection 149 (7) of the act that they meet the criteria of independence laid down inSection 149 (6) of the act. Further all the independent directors of the company haveregistered themselves in the independent director data bank.
INFORMATION ON DIRECTORATE
During the year under review there were no changes took place in the composition ofboard of directors of the Company.
In accordance with the provisions of the Articles of Association and Section 152 of theCompanies Act 2013 Mr. Jayantibhai M. Kumbhani Managing Director (DIN: 00587807)retires by rotation at the ensuing annual general meeting. He being eligible has offeredhimself for re-appointment as such and seeks reappointment. The Board of Directorsrecommends his re-appointment on the Board. The relevant details as required underRegulation 36 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 ("SEBI Listing Regulations") and secretarial standard of the personseeking re-appointment/ appointment as Director are also provided in the Notice conveningthe annual general meeting.
KEY MANAGERIAL PERSONNEL
In accordance with Section 203 of the Companies Act 2013 the Company has on itsBoard Mr. Ghanshyambhai Kumbhani (DIN: 00587855) who is acting as Chairman & WholeTime Director Mr. Jayantibhai Kumbhani (DIN: 00587807) who is acting as a ManagingDirector Mr. Mukesh Shah who is acting as Chief Financial Officer. During the year underreview Ms. Lata Dharmani company secretary has tendered her resignation w.e.f September13 2019. The board took the same into consideration and appointed Ms. Ankita Lunagariyaas the Company Secretary in the Company w.e.f. October 18 2019.
The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act.
o The performance of the board was evaluated by the board after seeking inputs fromall the directors on the basis of the criteria such as the board composition andstructure effectiveness of board processes information and functioning etc.
o The performance of the committees was evaluated by the board after seeking inputsfrom the committee members on the basis of the criteria such as the composition ofcommittees effectiveness of committee meetings etc.
o The board and the nomination and remuneration committee reviewed the performance ofthe individual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role. Separate meetingof independent directors was held to evaluate the performance of non-independentdirectors performance of the board as a whole and performance of the chairman takinginto account the views of executive directors and non-executive directors. The same wasdiscussed in the board meeting that followed the meeting of the independent directors atwhich the performance of the board its committees and individual directors was alsodiscussed. Performance evaluation of independent directors was done by the entire boardexcluding the independent director being evaluated.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to section 134(5) of the Companies Act 2013 the board of directors to thebest of their knowledge and ability confirm that:
a. In preparation of annual accounts for the year ended March 31 2020 the applicableaccounting standards have been followed and that no material departures have been madefrom 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 at the end of the financial year and ofthe profit or loss of the Company for that year;
c. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d. The Directors had prepared the annual accounts for the year ended March 31 2020 ongoing concern basis.
e. The directors in the case of a listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively.
f. The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
COMMITTEES OF THE BOARD
The Board of Directors considering the the requirement of the act has formed variouscommittees details of which are given hereunder.
(a) Audit Committee:
Pursuant to Section 177 of the companies Act 2013 and Regulation 18 of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Audit committeeshall meet as and when required. The Audit Committee meeting is generally held for thepurpose of recommending the half yearly and yearly financial result. Additional meeting isheld for the purpose of reviewing the specific items included in terms of reference of theCommittee. During the year under review Audit Committee met 3 (Three) times viz on April04 2019 May 27 2019 and November 14 2019. The composition of the Committee and thedetails of meetings attended by its members are given below:
The Statutory Auditors of the Company are invited in the meeting of the Committeewhenever required. The Chief Financial Officer of the Company is a regular invitee at theMeeting. Recommendations of Audit Committee wherever/whenever given have been acceptedby the Board.
The Company has established a vigil mechanism and accordingly framed a Whistle BlowerPolicy. The policy enables the employees to report to the management instances ofunethical behaviour actual or suspected fraud or violation of Company's Code of Conduct.Further the mechanism adopted by the Company encourages the Whistle Blower to reportgenuine concerns or grievances and provide for adequate safe guards against victimizationof the Whistle Blower who avails of such mechanism and also provides for direct access tothe Chairman of the Audit Committee in exceptional cases. The functioning of vigilmechanism is reviewed by the Audit Committee from time to time. None of the Whistleblowers has been denied access to the Audit Committee of the Board. The Whistle BlowerPolicy of the Company is available on the website of the Company at www.sikkoindia.com.
(b) Stakeholders Relationship Committee:
The Board of Directors of the Company has constituted Stakeholders' RelationshipCommittee in order to mainly focus on the redressal of Shareholders' Grievances if anylike Transfer / Transmission / Demat of Shares; Loss of Share Certificates; Non-receipt ofAnnual Report; Dividend Warrants; etc. The Stakeholders Relationship Committee shall meetto report to the Board on a quarterly basis regarding the status of redressal ofcomplaints received from the shareholders of the Company. During the year under reviewthe Stakeholder's Grievance & Relationship Committee met 4 (Four) times viz on May 272019 September 05 2019 November 14 2019 and March 10 2020. The composition of theCommittee and the details of meetings attended by itsCommittee members are given below:
During the year the Company had not received any complaints from the Shareholders.There was no complaint pending as on March 31 2020.
(c) Nomination and Remuneration Committee:
The Board of Directors of the Company has constituted Nomination and Remunerationcommittee in order to identify the persons who are qualified to become Directors and maybe appointed in senior management and recommending their appointments and removal. TheNomination and Remuneration Committee meetings are generally held for identifying thepersons who are qualified to become Directors and may be appointed in senior managementand recommending their appointments and removal. Further the committee shall also meet asand when the need arises for review of Managerial Remuneration. During the year underreview the Nomination and Remuneration Committee met 3 (Three) times viz on September 052019 October 18 2019 and March 10 2020. The composition of the Committee and thedetails of meetings attended by its members are given below:
Nomination and Remuneration Policy:
Nomination and Remuneration Policy in the Company is designed to create ahigh-performance culture. It enables the Company to attract motivated and retainedmanpower in competitive market and to harmonize the aspirations of human resourcesconsistent with the goals of the Company. The Company pays remuneration by way of salarybenefits perquisites and allowances to its Managing Director and the Executive Directors.Key points of the Nomination and Remuneration Policy are;
a. Policy on Appointment and Nomination of Directors Key Managerial Personnel andSenior Management Personnel:
o The policy is formulated to identify and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director Key ManagerialPersonnel and Senior Management personnel and recommend to the Board for his / herappointment. o A person should possess adequate qualification expertise and experiencefor the position he/ she isconsidered for appointment. o In case of appointment ofIndependent Director the Committee shall satisfy itself with regard to the independentnature of the Director vis--vis the Company so as to enable the Board to discharge itsfunction and duties effectively.
b. Policy on remuneration of Director KMP and Senior Management Personnel:
The Company's remuneration policy is driven by the success and performance of DirectorKMP and Senior Management Personnel vis--vis the Company. The Company's philosophy is toalign them with adequate compensation so that the compensation is used as a strategic toolthat helps us to attract retain and motivate highly talented individuals who arecommitted to the core value of the Company. The Company follows mixed of fixed paybenefits and performance based variable pay. The Company pays remuneration by way ofsalary benefits perquisites and allowance. The remuneration and sitting fees paid by theCompany are within the salary scale approved by the Board and Shareholders. The Nominationand Remuneration Policy as adopted by the Board of Directors is placed on the website ofthe Company at www.sikkoindia.com.
Remuneration of Director:
The details of remuneration paid during the financial year 2019-20 to directors of theCompany is provided in Form MGT-9 which is the part of this report.
The company has not accepted any deposits from the public. Hence the directives issuedby the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act2013 or any other relevant provisions of the Act and the Rules there under are notapplicable.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Security covered under the provisions of Section 186of the Companies Act 2013 are given in the notes to the Financial Statement.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
A particular of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is annexed to this Reportas "ANNEXURE A".
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS
During the Year under review no significant and material orders passed by anyregulators or courts or tribunals impacting the going concern status and company'soperation in future.
EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3) (a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as "ANNEXURE - B"tothe Board's report.
DISCLOSURE OF REMUNERATION
The ratio of the remuneration of each Executive Director to the median of employees'remuneration as per Section 197(12) of the Companies Act 2013 read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed tothis Report as "Annexure C". Refer to tables 3A (a) in "ANNEXUREC ".
There are no employees who are posted outside India and who are in receipt of aremuneration of Rupees 60.00 lakhs or more per annum or Rupees 5.00 lakhsor more a month.
MATERIAL CHANGES AND COMMITMENT
There are no material changes and commitments affecting the financial position of theCompany have occurred between the ends of financial year of the Company i.e. March 312020 to the date of this Report.
INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2014 To foster a positive workplace environmentfree from harassment of any nature we have institutionalized the Anti-Sexual HarassmentInitiative (ASHI) framework through which we address complaints of sexual harassment atthe all workplaces of the Company. Our policy assures discretion and guaranteesnon-retaliation to complainants. We follow a gender-neutral approach in handlingcomplaints of sexual harassment and we are compliant with the law of the land where weoperate. During the year under review there were no incidences of sexual harassmentreported.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company has an effective internal control system which ensures that all theassets of the Company are safeguarded and protected against any loss from unauthorized useor disposition. The Internal Auditor of the Company carries out review of the internalcontrol systems and procedures. The internal audit reports are reviewed by AuditCommittee.
Your Company strives to incorporate the appropriate standards for corporate governance.However pursuant to Regulation 15(2) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company is not required to mandatorily comply with theprovisions of certain regulations of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and therefore the Company has not provided a separatereport on Corporate Governance although few of the information are provided in thisreport under relevant heading.
A well-defined risk management mechanism covering the risk mapping and trend analysisrisk exposure potential impact and risk mitigation process is in place. The objective ofthe mechanism is to minimize the impact of risks identified and taking advance actions tomitigate it. The mechanism works on the principles of probability of occurrence andimpact if triggered. A detailed exercise is being carried out to identify evaluatemonitor and manage both business and non-business risks.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy technology absorption foreignexchange earnings and outgo pursuant to Section 134(3) (m) of the Act read with Companies(Accounts) Rules 2014 is prepared and is enclosed as "ANNEXURE -D ".
STATUTORY AUDITOR AND THEIR REPORT:
Pursuant to the provisions of Section 139 of the Companies Act 2013 read with rulesmade there under M/s. D G M S & Co. Chartered Accountants Jamnagar (FRN: 0112187W)were appointed as Statutory Auditors of the Company to hold office till conclusion of the24th Annual General Meeting (AGM) of the company to be held in the calendaryear 2024.
The Notes to the financial statements referred in the Auditors Report areself-explanatory and therefore do not call for any comments under Section 134 of theCompanies Act 2013. The Auditors' Report does not contain any qualification reservationor adverse remark. The Auditors' Report is enclosed with the financial statements in thisAnnual Report.
REPORTING OF FRAUD
The Auditors of the Company have not reported any fraud as specified under Section143(12) of the Companies Act 2013.
DETAILS OF SUBSIDIARIES/ ASSOCIATES/ JOINT VENTURES
The Company does not have any Subsidiary Joint venture or Associate Company.
MANAGEMENTDISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 and Schedule V of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a review of the performance of the Company for the yearunder review Management Discussion and Analysis Report is presented in a separatesection forming part of this Annual Report.
SECRETARIAL AUDITOR AND THIEIR REPORT
Pursuant to the provisions of Section 204 of the Act read with The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Company hasappointed Mr. Nirmalkumar Solanki Practicing Company Secretary Ahmedabad to conduct theSecretarial Audit of the Company for the financial year 2019-20. The Secretarial AuditReport is annexed herewith as "ANNEXURE E" to this Report.
Your Directors state that the Company has made disclosures in this report for the itemsprescribed in section 134 (3) of the Act and Rule 8 of The Companies (Accounts) Rules2014 and other applicable provisions of the act and listing regulations to the extent thetransactions took place on those items during the year. Your Directors further state thatno disclosure or reporting is required in respect of the following items as there were notransactions on these items during the year under review;
(i) Issue of Equity Shares with differential rights as to dividend voting orotherwise;
(ii) Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and ESOS;
(iii) Annual Report and other compliances on Corporate Social Responsibility;
(iv) There is no revision in the Board Report orFinancial Statement;
(v) No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future;
(vi) Information on subsidiary associate and joint venture companies.
Your Directors wish to place on record their sincere appreciation for significantcontributions made by the employees at all levels through their dedication hard work andcommitment enabling the Company to achieve good performance during the year under review.Your Directors also take this opportunity to place on record the valuable co-operation andsupport extended by the banks government business associates and the shareholders fortheir continued confidence reposed in the Company and look forward to having the samesupport in all future endeavors.
FORM MGT 9
EXTRACT OF ANNUAL RETURN
As on the financial year ended March 31 2020
[Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014]
1) Registration and Other Details:
2) Principal Business Activity of the Company: All the business activitiescontributing 10% or more of the total turnover of the Company shall be stated.
3) Particulars of Holding Subsidiary and Associate Companies:
4) Shareholding Pattern (Equity Share Capital Breakup as percentage of Total Equity):I. Category-wise Shareholding:
II. Shareholding of Promoters & Promoters Group:
* The trading in the shares of the Company took place on almost daily basistherefore the date wise increase/ decrease in Shareholding of Promoters and Promoters'Group are taken on the basis of weekly BenPoze. No shares have been Pledged /encumbered byany of the Promoters or Promoters' Group Shareholders.
III. Shareholding Pattern of top ten Shareholders (other than Directors Promoters andHolders of GDRs and ADRs):
* The trading in the shares of the Company took place on almost daily basistherefore the date wise increase/ decrease in Shareholding of top ten Shareholders aretaken on the basis of weekly BenPoze.
IV. Shareholding of Directors and Key Managerial Personnel:
* The trading in the shares of the Company took place on almost daily basistherefore the date wise increase/ decrease in Shareholding of Promoters and Promoters'Group are taken on the basis of weekly BenPoze. Further there are no transactions havebeen executed by Directors and Key Managerial Personnel based on weekly BenPose of theCompany and confirmation given by them.
6) Remuneration of Directors and Key Managerial Personnel
A) Remuneration to Managing Director Whole-time Directors and/or Manager
B) Remuneration to other Directors
C) Remuneration to Key Managerial Personnel
7) Penalties / Punishment/ Compounding of Offences
C. Other Officers in Default