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Siyaram Silk Mills Ltd.

BSE: 503811 Sector: Industrials
BSE 00:00 | 24 Feb 226.30 2.05






NSE 00:00 | 24 Feb 225.25 0.80






OPEN 224.10
52-Week high 467.00
52-Week low 192.05
P/E 11.15
Mkt Cap.(Rs cr) 1,060
Buy Price 223.00
Buy Qty 1.00
Sell Price 226.30
Sell Qty 1.00
OPEN 224.10
CLOSE 224.25
52-Week high 467.00
52-Week low 192.05
P/E 11.15
Mkt Cap.(Rs cr) 1,060
Buy Price 223.00
Buy Qty 1.00
Sell Price 226.30
Sell Qty 1.00

Siyaram Silk Mills Ltd. (SIYSIL) - Director Report

Company director report

To the Members

Your Directors have pleasure in presenting the 41st Annual Report of theCompany along with Audited Financial Statements for the year ended 31st March2019.


Particulars 2018-19 2017-18
Net Turnover and other Income 184295 175909
Profit before Depreciation Exceptional Item and Tax 22110 23784
Less: Depreciation 6189 6055
Profit before Exceptional Item and Tax 15921 17729
Less : Exceptional Item 472 602
Profit before Tax 15449 17127
Less: Tax Expense
Current Tax 5138 6405
Deferred Tax 360 (440)
Income Tax related to earlier year (166) 3
5333 5968
Profit after Tax 10116 11159
Add/(Less): Other Comprehensive Income (net of taxes) 137 (24)
Total Comprehensive Income for the year 10253 11135


During the year under review the Total Income of your Company was Rs. 184295 Lakhsas compared to Rs. 175909 Lakhs in the previous year reflecting a growth of 4.77%. Thenet profit for the year stood at Rs. 10253 Lakhs against Rs. 11135 Lakhs in the previousyear.


During the year under review your Company has set-up an Indigo Plant with a capacityof 250 MT per month and commenced commercial production. The total capital outlay of Rs.9038.51 Lakhs was financed by way of Term Loan under TUF scheme of the Government of Indiaand internal accruals of the Company.


During the year the Company has paid Interim Dividend of 110% i.e. Rs. 2.20 per EquityShare. Your Directors are pleased to recommend a Final Dividend of 110% i.e. Rs. 2.20 perEquity Share of Rs. 2/- each taking the total dividend to 220% i.e. Rs. 4.40 per EquityShare of Rs. 2/- each for the year 2018-19 (previous year Dividend was 210% i.e. Rs. 4.20per Equity Share of Rs. 2/- each).


The Paid-up Share Capital of the Company as on 31st March 2019 was Rs. 937.40 Lakhs.

During the year under review the Company has not issued shares with differentialvoting rights nor granted stock options nor sweat equity. As on 31st March 2019 none ofthe Directors of the Company hold convertible instruments in the Company.


The Company has transferred Rs. 10000 Lakhs to General Reserves during the year underreview.


During the year under review global economic growth has been punctuated by escalatingglobal trade disputes and episodes of financial stress and volatility amid undercurrentof geo-political tensions. A fiscally induced acceleration in the United States of Americaoffset slower growth in some large economies. Despite this economic growth accelerated inmore than half of the world's economies indicating an overall steady growth.

Current Year Indian Economic Overview.

On the domestic front riding on the benefits of structural reforms and revival ofcredit growth the Indian Economy is estimated to have better growth than the last year.The Indian economy witnessed good industrial growth during the year under review. Indiahas retained its position as the third largest start-up base in the world and isconsidered the fastest growing major economy. During the year with investment picking upand consumption strong the Indian Economy is estimated to have grown @7.3% during thefiscal year 2018-19.

Indian Textile Industry Overview.

During the year under review the Indian Textile Industry has witnessed subdued growthin domestic as well as export market. The International demand was largely muted onaccount of the trade war and its uncertainty whereas the domestic demand did not pick upas expected as the Industry was getting in terms with the GST regime. Your Company hasachieved marginal growth in its top line however there was a dip in the profitability dueto adverse market conditions and escalation in the overall cost. Global Economic FutureOutlook.

The Global Economic growth in emerging markets and developing economies depends uponmacroeconomic stability. However the on-going trade war between large developed economiesis expected to disturb this stability. A range of triggers beyond escalating tradetensions including a "no-deal" withdrawal of the United Kingdom from theEuropean Union a greater-than- envisaged slowdown in China introduction of new fuelemission standards in Germany sovereign and financial risk weighed on domestic demand inItaly and further weakening financial market in Turkey could effect global economicgrowth in the year ahead.

Indian Economic Future Outlook.

India's domestic demand is expected to continue to grow during the current year whichwill be driving force for the growth in the Indian Economy. Further a stable and strongGovernment will augment growth. On the other hand vulnerabilities are being exacerbatedby fiscal slippages the possibility of delays in needed structural reforms to address theweaknesses in the banking and financial sector are expected to be the restraining factorsto growth. Textile Industry Outlook.

The year ahead looks good for the Indian Textile Industry buoyed by both strongdomestic consumption as well as export demand. With consumerism disposable income on therise and with the entry of several international players into the India markets theretail sector has experienced a rapid growth. All this coupled with the Governmentcontinuing with the incentives schemes like Technology Up-gradation Fund Scheme (TUFS) andexport promotion policies for the Textile Industries the outlook looks enterprising forthe Industry.

Your Company with its well known Brands ultra modern manufacturing facilitiesaggressive marketing strategies and well penetrated distribution network is expected tocontinue on its path of sustained growth and profitability in the times to come.

Internal Financial Control system.

Your Company has in place an adequate internal financial control system commensuratewith the size and complexity of its operations. Necessary checks and controls are in placeto ensure that all assets are safeguarded to detect and prevent errors and frauds andthat the transactions are properly verified adequately authorized correctly recorded andproperly reported. The Internal Auditors of the Company conduct Audit of variousdepartments to ensure that internal controls are in place and submit Quarterly Reports tothe Audit Committee. The Audit Committee regularly reviews these Reports and the Companywhen needed takes corrective actions.

The Internal Auditors also audit the effectiveness of the Company's internal financialcontrol system. No major inefficiencies were reported.

Human Resources/ Industrial Relations.

Your Company treats its Human Resources as its important asset and believes in itscontribution to the all-round growth of your Company. Your Company takes steps from timeto time to upgrade and enhance the quality of this asset and strives to maintain it inagile and responsive form. Your Company is an equal opportunity employer and practicesfair employment policies. Your Company is confident that its Human Capital willeffectively contribute to the long term value enhancement of the organization. YourDirectors further state that during the year under review there were no cases filedpursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.

Industrial relations with staff and workmen during the year under review continued tobe cordial.

Key Financial Ratios

Ratios 2019 2018 Change
Debtors Turnover 4.46 4.77 (6.60%)
Inventory Turnover 4.27 4.65 (8.19%)
Interest Coverage Ratio 4.29 6.01 (28.54%)
Current Ratio 1.78 1.43 24.48%
Debt Equity Ratio 0.18 0.20 (8.58%)
Operating Profit Margin % 7.43% 8.94% (16.89%)
Net Profit Margin % 5.57% 6.64% (13.51%)
Return on Net Worth % 13.00% 16.00% (18.75%)

Note: (1) Above ratios are based on Standalone Financials of the Company.

(2) Lower Interest Coverage Ratio and Return on Net Worth is due to lower profitabilityduring the year.

Forward Looking Statements.

Statement in the Management Discussion and Analysis describing the Company'sobjectives projections estimates expectations or predictions may be forward lookingstatements within the meaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed or implied. Important factors thatcould make a difference to the Company's operations include raw material availability andprices cyclical demand and pricing in the Company's principal markets changes inGovernment regulations tax regimes economic developments within India and the countriesin which the Company conducts business and other incidental factors.


A report on Corporate Governance as stipulated in the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBI(LODR) Regulations 2015"/"the Listing Regulations") together withCertificate from the Auditors of the Company confirming compliance of conditions ofCorporate Governance as stipulated under the aforesaid regulations forms part of theAnnual Report.



Your Directors pay their respectful homage to late Shri. Dharaprasad Poddarji ChairmanEmeritus and founder Promoter who left for his heavenly abode on 20th October 2018. YourDirectors pay rich tribute for the inspired leadership provided by late Shri. DharaprasadPoddarji under whose advice guidance and support your Company has registered continuousgrowth and profitability for over 4 decades since incorporation of the Company. Late Shri.Dharaprasad Poddarji was a great and humble leader a respected philanthropist as well asa visionary and entrepreneur par excellence. His presence will always be felt and thebenefits of his untiring efforts will be reaped by generations to come. Your Directorspray to the Almighty to grant eternal peace to his departed soul.

Directors appointment / re-appointment

Shri. Shrikishan D. Poddar Director retires by rotation and being eligible offershimself for re-appointment. Your Directors commend his re-appointment.

Smt. Mangala R. Prabhu was appointed as an Additional Director by the Board on 25thMarch 2019 and holds office upto the date of the ensuing Annual General Meeting (AGM).She has also been appointed as an Independent Director for a period of 5(five) continuousyears with effect from 25th March 2019 till 24th March 2024 subject to approval of themembers at the AGM. Resolution for her appointment as a Director as well as IndependentDirector of the Company is proposed for the approval of the members at the ensuing AGM.Your Directors commend her appointment.

Brief resume of Directors being appointed/ re-appointed as required by the SEBI (LODR)Regulations 2015 and Secretarial Standards on General Meetings are provided in theAnnexure to the notice convening the AGM of the Company.

Declaration from Independent Directors.

All Independent Directors have given declaration that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and regulation16(b) of SEBI (LODR) Regulations 2015.

Company's Policy on appointment and remuneration of Directors.

Appointment of Independent Directors.

All Independent Directors of the Company are appointed for a term of 5 years.Accordingly the Independent Directors viz. Shri. Harish Motiwalla Shri. Mangesh TeliShri. Dileep Shinde Shri. Pramod Jalan Shri. Shailesh Vaidya and Shri. Ashok Garodiahold office upto 31st July 2019 and Shri. Tarun Kumar Govil upto 29th July 2019.Criteria for appointment of Independent Directors.

The Independent Directors shall be of high integrity with relevant experience andexpertise in the fields of manufacturing marketing finance taxation law governanceand general management so as to have a diverse Board.

Criteria for appointment of Managing Directors/ Whole Time Directors.

The Nomination and Remuneration Committee shall identify persons of integrity whopossess relevant experience and expertise particularly in the Textile Industry leadershipqualities required for the position and shall take into consideration recommendation ifany received from any member of the Board.

Remuneration Policy.

The Company follows a policy on remuneration for Directors and Senior ManagementEmployees details of the same are given in the Corporate Governance Report.

Performance Evaluation.

Pursuant to the provisions of the Companies Act 2013 and the Listing Regulations theNomination and Remuneration Committee has laid down the criteria for evaluation of theperformance of Individual Directors the Board as a whole and also the SecretarialDepartment. Evaluation of performance is undertaken annually.

The performance evaluation of the Chairman and the Non Independent Directors wascarried out by the Independent Directors at a separately convened meeting held on 25thMarch 2019 at which the performance of the Board as a whole was also evaluated and theperformance of the Secretarial Department was also reviewed. The Company has implemented asystem of evaluation on the basis of a structured questionnaire which comprises evaluationcriteria taking into consideration various performance related aspects. The performanceevaluation of the Independent Directors was carried out by the entire Board (excluding theDirector being evaluated).

The Directors expressed their satisfaction with the evaluation process.


The Board of Directors met 5(five) times during the year the details of which areprovided in the Corporate Governance Report.


The Board has the following Committees:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Stakeholders' Relationship Committee

4. Corporate Social Responsibility Committee

5. Finance Committee

6. Share Transfer Committee

7. Risk Management Committee

The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.


As stipulated under Section 134(3)(c) of the Companies Act 2013 your Directorsconfirm as under:-

i) that in the preparation of the accounts for the financial year ended 31st March2019 the applicable accounting standards have been followed along with proper explanationrelating to material departure if any;

ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31st March 2019and of the profit of the Company for the year under review;

iii) that the Directors have taken proper and sufficient care for maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

iv) that the Directors have prepared the accounts for the financial year on goingconcern basis.

v) the Directors have laid down internal financial controls which are adequate andwere operating effectively.

vi) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


Extract of the Annual Return in Form No. MGT - 9 as required under section 92 of theCompanies Act 2013 is annexed herewith as Annexure - I to this Report.

In compliance with section 134(3)(a) of the Act Form MGT - 9 is uploaded on theCompany's website and can be accessed at


During the year under review your Company has not accepted any fixed deposits andthere were no unclaimed deposits or interest thereon as on 31st March 2019.


Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are provided in the notes to the Standalone FinancialStatements.


Cadini S.R.L.

The Company has a wholly owned foreign subsidiary namely Cadini S.R.L. Italy. Pursuantto Section 129(3) of the Companies Act 2013 read with Rule 5 of the Companies (Accounts)Rules 2014 a statement containing salient features of the financial statements of thesubsidiary is given in Form AOC-I and forms part of the Annual Report.


The Consolidated Financial Statements of the Company are prepared in accordance withthe relevant Indian

Accounting Standard issued by the Institute of Chartered

Accountants of India and forms part of the Annual Report.


The Company has framed a Whistle Blower Policy to deal with instances of fraud andmismanagement if any. The details of the Policy are given in the Corporate GovernanceReport and the Policy is posted on the Company's website at the link policies.html


All related party transactions that were entered into during the financial year were inthe ordinary course of business and were on an arm's length basis. There are no materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other related parties which may have a potential conflict with theinterest of the Company at large. During the year the Company has not entered intorelated party transactions which could be considered as material in accordance with thepolicy on Related Party Transactions of the Company. Accordingly the disclosure ofrelated party transactions as required under section 134(3)(h) of the Companies Act 2013in Form AOC -2 is not applicable to your Company.

All related party transactions for the year are placed before the Audit Committee aswell as before the Board for approval. The transactions entered into with related partiesare reviewed on a quarterly basis by the Audit Committee.

The policy on Related Party Transactions as approved by the Audit Committee and Boardis uploaded on the Company's website at the link

Members can refer to Note No. 40 to the Financial Statements which sets out relatedparty disclosures.


In line with the regulatory requirements the Company has framed a Risk ManagementPolicy to identify and assess the key business risk areas and to put in place a mechanismfor mitigation of risk. A detailed exercise is being carried out at regular intervals toidentify evaluate manage and monitor all business risks. The Board periodically reviewsthe risks and suggests steps to be taken to control and mitigate the same through aproperly defined framework.


There are no significant and material orders passed by the Regulators / Courts whichwould impact the going concern status of the Company and its future operations.


There have been no material changes or commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the Report.


Information pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule 8of The Companies (Accounts) Rules 2014 is given in Annexure -II to this Report.


The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure -III of this Report in the format prescribed in the Companies (CorporateSocial Responsibility Policy) Rules 2014. The Policy is available on the Company'swebsite at the link relations/policies.html


a. Statutory Auditors:

In the 39th AGM held on 9th September 2017 M/s. Songira & Associates CharteredAccountants (FRN.128085W) have been appointed as Statutory Auditors of the Company for aperiod of 5(five) years from the conclusion of the 39th AGM till the conclusion of the44th AGM of the Company to be held in the year 2022.

Further the Report of the Statutory Auditors M/s. Songira & Associates CharteredAccountants forms part of the Annual Report. The observations made in the Auditors'Report are self-explanatory and therefore do not call for any further comments.

b. Cost Auditors:

As per the provisions of section 148 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 framed thereunder the Cost Audit of the costrecords of the Company for the F.Y 2018-19 was carried out by M/s. Bhuta & AssociatesCost Accountants and the related Report will be filed on or before 27th September 2019.The Cost Audit Report for the FY 2017-18 was filed on 31st August 2018. The Board ofDirectors has appointed M/s. Bhuta & Associates Cost Accountants as Cost Auditors toaudit cost records of the Company for the F.Y 2019-

20. A resolution seeking members' approval for the remuneration payable to them formspart of the Notice convening the AGM.

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 Mr. Jugalkishore Fatehchandka Company Secretary in Practice to undertakeSecretarial Audit for the financial year 2018-19. The Secretarial Audit Report is annexedherewith as Annexure - IV.

There is no secretarial audit qualification for the year under review.


The information required pursuant to Section 197(12) of the Companies Act 2013 readwith rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 is attached as Annexure V. In terms of the provisions of Section 197(12) of the Actread with subrule (2) and (3) of Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014

a statement showing the norms and other particulars of employees drawing remunerationin excess of the limits set out in the said Rules are provided in the Report. Howeverhaving regard to the provisions of the first proviso to section 136(1) of the CompaniesAct 2013 the details are excluded from the Report sent to members. The requiredinformation is available for inspection at the registered office/ corporate office and thesame shall be furnished on request.


Your Company is grateful for the continued co-operation and support extended to it bythe Government and Semi-Government Authorities Shareholders Financial InstitutionsBanks Customers and Vendors. Your Directors also express their warm appreciation for thededicated and sincere services rendered by the Employees of the Company.

For and on behalf of the Board of Directors

Chairman and Managing Director
Place: Mumbai DIN - 00090104
Date: 17th May 2019.