The Members Spectrum Foods Ltd.
Your Directors are pleased to present the 26th Annual Report together withthe Audited Financial Statements of the Company for the year ended 31st March2020.
The financial results of the Company for the year ended 31st March 2020 ascompared to the previous year are summarized below:
|Particulars ||Financial year ended 31st March 2020 ||Financial year ended 31st March 2019 |
|Total Income ||91239269 ||95830368 |
|Profit before depreciation and taxation ||18664867 ||16090178 |
|Depreciation ||17211512 ||20667339 |
|Profit before tax ||1453355 ||(4577161) |
|Taxation (including Deferred Taxation and Short/Excess Provision for Earlier year) ||87151 ||0 |
|Profit (loss) after Tax ||1366204 ||(4577161) |
TURNOVER PROFITS & FUTURE PROSPECTS
The revenue from operations of the Company was decreased from 9.58 Crores to 9.12Crores in current year as compared to previous year. But this year the profit aftertaxation has been duly increased to 13.66 Lacs. The company has delivered record financial& operating performance amidst competitive and volatile market condition. Board istaking necessary steps to improve the performance of the Company and to have betterworking results in the coming years.
DEPRECIATION AND FINANCE COSTS
Depreciation for the year was Rs.1.72 Crores as against Rs.2.06 Crores for the previousyear. Finance costs for the year ended 31st March 2020 was Rs. 1.45 Crores as againstRs. 1.50 Crores in the previous year.
FY20 has been a challenging year. In the last month of FY20 the COVID-19 pandemicdeveloped rapidly into a global crisis forcing governments to enforce lock-down of alleconomic activity. For the Company the focus immediately shifted to ensuring the healthand well-being of all employees. As of March 31 2020 work from home was enabled to theemployees to work remotely and securely.
TRANSFER TO RESERVES
The Company is not proposing to transfer any amount to the Reserves of the Company.
In view of the financial position of the Company the Directors do not recommendpayment of dividend for the year ended 31st March 2020.
CORPORATE SOCIAL RESPONSIBILITY
The company does not meet the criteria of Section 135 of Companies Act 2013 read withthe Companies (Corporate Social Responsibility Policy) Rules 2014 so there is norequirement to constitute Corporate Social Responsibility Committee.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
The Provisions of section 125(2) of Companies Act 2013 are not applicable as there wasno dividend declared or paid last year.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There was no significant and material order passed by the regulators or courts ortribunals which may impact the going concern status and company's operations in future.
DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS
The Company has in place adequate internal financial controls with reference to thefinancial statements. Statutory Auditors in their report have expressed their opinion onthe internal financial controls with reference to the financial statements which isself-explanatory. The Board has adopted the policies and procedures for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies safeguarding of its assets the prevention and detection of frauds and errorsthe accuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.
During the year under review your Company has not accepted any deposits from publicand as such in terms of the provisions of Section 73 to 76 of the Companies Act 2013read with the Companies (Acceptance of Deposits) Rules 2014 and hence no amount onaccount of principal or interest on public deposits was outstanding as on the date of thebalance sheet.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Pursuant to section 186 of Companies Act 2013 and Schedule V of the ListingRegulations disclosure on particulars relating to Loans Advances Guarantees andInvestments are provided as part of the Financial Statements.
BORROWINGS / INDEBTNESS
Pursuant to section 180(1) of Companies Act 2013 disclosure on particulars relatingto borrowing and indebtness are provided as part of the financial statements.
SUBSIDIARIES JOINT VENTURE AND ASSOCIATE COMPANIES
The company does not have any subsidiary Joint ventures or associate company.
CAPITAL STRUCTURE OF THE COMPANY
The Current Capital Structure of the Company is given below:-
1. AUTHORISED CAPITAL:-
During the Financial Year 2019-20 the Authorised Capital of the Company is Rs.70000000/- (Rupees Seven Crore Only) divided into 7000000 (Seventy Lakh) EquityShares of Rs. 10/- (Rupees Ten Each).
2. ISSUED CAPITAL:-
During the Financial Year 2019-20 the Issued Capital of the Company is Rs.48483860/- (Rupees Four Crore Eighty Four Lakh Eighty Three Thousand Eight Hundred andSixty Only) divided into 4848386 (Forty Eight Lakh Forty Eight Thousand Three Hundredand Eighty Six) Equity Shares of Rs. 10/- (Rupees Ten Each).
3. SUBSCRIBED & PAID UP CAPITAL:-
During the Financial Year 2019-20 the Subscribed & paid up Capital of the Companyis Rs. 48483860/- (Rupees Four Crore Eighty Four Lakh Eighty Three Thousand EightHundred and Sixty Only) divided into 4848386 (Forty Eight Lakh Forty Eight ThousandThree Hundred and Eighty Six) Equity Shares of Rs. 10/- (Rupees Ten Each).
1. BUY-BACK OF SHARES:
During the year under review company has not bought back any of its shares.
2. SWEAT EQUITY SHARES:
During the year under review company has not issued any Sweat Equity shares.
3. BONUS SHARES:
During the year under review company has not issued any Bonus shares.
4. EMPLOYEE STOCK OPTION PLAN:
During the year under review company has not provided any Stock option plan to itsemployees.
1. CHANGE IN THE NATURE OF BUSINESS
There is no change in the nature of business of the Company.
2. NUMBER OF BOARD MEETINGS
During the year under review company has conducted 14 (Fourteen) Board meetings. Thedetailed disclosure of the Board of Directors and their Meetings is given in the CorporateGovernance Report which forms part of this report.
3. COMPOSITION OF BOARD OF DIRECTORS
The members of the Company's Board of Directors are eminent persons of provencompetence and integrity. Besides experience strong financial acumen strategicastuteness and leadership qualities they have a significant degree of commitment towardsthe Company and devote adequate time to the meetings and preparation. The detaileddisclosure of the Board of Directors is given in the Corporate Governance Report whichforms part of this report.
4. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year Mr. Rakesh Godha was appointed as Additional Directors w.e.f. 12thAugust 2019 and was regularized as Whole Time Directors w.e.f. 30th September2019. And also Mrs. Bindu Saboo who was originally appointed as Additional Directorsw.e.f. 26th September 2018 was regularized as a Non- Executive Non-Independent Women Director w.e.f. 30th September 2019. Details of changes inDirectors and Key Managerial Personnel are as follows:
|Name of Director ||Designation ||Date of Change ||Nature of Change |
|Mr. Girdhar Gopal Saboo ||Managing Director ||NA ||NA |
|Mr. Sanjay Sarna ||Independent Director ||NA ||NA |
|Mr. Kunj Behari Sharma ||Independent Director ||NA ||NA |
|Mr. Neeraj Kumar Agarwal ||Independent Director ||NA ||NA |
|Mrs. Bindu Saboo ||Women Director ||30.09.2019 ||Appointment(Regularized) |
|Mr. Rakesh Godha ||Whole Time Director Company Secretary ||12.08.2019 ||Appointment |
|Ms. Shweta Gupta ||Cum Compliance Officer Company Secretary ||30.10.2019 ||Resignation |
|Ms. Kashika Soni ||Cum Compliance Officer ||30.10.2019 ||Appointment |
5. PERFORMANCE EVALUATION CRITERIA FOR DIRECTORS:
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 (Listing Regulations) the Board has carriedout an Annual Evaluation of its own performance Board Committees and IndividualDirectors. The performance of the Board was evaluated by the Board after seeking inputsfrom all the directors on the basis of the criteria such as the Board composition andstructure effectiveness of Board processes information and functioning etc. Theperformance of the Committees was evaluated by the Board after seeking inputs from theCommittee Members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc. Performance evaluation of independent directorswas done by the entire Board excluding the Independent Director being evaluated. In aseparate meeting of independent Directors performance of Non-Independent Directors theBoard as a whole and the Chairman of the Company and Whole time Directors was evaluated.The Chairman of the Board and the Nomination and Remuneration Committee reviewed theperformance of the individual directors on the basis of the criteria approved by theBoard. Each Committee and the Board expressed satisfaction on the performance of eachDirector.
6. STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTOR U/S 149(6) OF THECOMPANIES ACT 2013:
The Company has three (3) Independent Directors in accordance with the requirements ofListing Regulations as well as the Companies Act 2013. The Company has received necessarydeclaration from all the three Independent Directors to the effect that they meet thecriteria of independence as provided under Section 149(6) of the Companies Act 2013 andRegulation 16(b) of SEBI (LODR) Regulations 2015. In the opinion of the Board theyfulfill the conditions specified in the Act and the Rules made there under for theappointment as Independent Directors and are Independent of the Management.
7. MEETING OF INDEPENDENT DIRECTORS:
A separate meeting of Independent Directors as required under the Schedule IV of theCompanies Act 2013 was held on 01st January 2020 without presence ofExecutive Directors. Such meeting was conducted to review and evaluate:
(a) the performance of Non-Independent Directors and the Board as a whole
(b) the performance of the Chairperson of the company taking into account the views ofExecutive Directors and Non-Executive Directors and
(c) assess the quality quantity and timeliness of flow of information between thecompany management and the Board that is necessary for the Board to effectively andreasonably perform their duties. The Independent Directors expressed their satisfactionwith the performance of Non-Independent Directors and the Board as a whole and theChairman of the Independent Directors meeting briefed the outcome of the meeting to theChairman of the Board. The Independent Directors expressed satisfaction with the overallperformance of the Directors and the Board as a whole.
1. STATUTORY AUDITOR
M/s P. K. S & Co. Chartered Accountants (Firm Registration No. 007007C) wasappointed as Statutory Auditors for a period of Five years in the Annual General Meetingheld on 30th September 2019. Their continuance of appointment and payment ofremuneration are to be confirmed and approved in the ensuing Annual General Meeting.
There are no qualifications or adverse remarks in the Auditors' Report which requireany clarification/ explanation. The Notes on financial statements are self-explanatoryand needs no further explanation. Further the Auditors' Report for the financial yearended 31st March 2020 is annexed herewith for your kind perusal and information.
2. 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 Naredi Vinod & Associates (CP No. 7994 ACS: 20453) Company Secretariesto undertake the Secretarial audit of the company for the financial year 2019-20.
3. INTERNAL AUDITOR
Mr. Aditya Khunteta (ICAI Membership Number: 434255) Partner of M/s Aditya Khunteta& Associates Chartered Accountants perform the duties of Internal Auditors of thecompany and their report is reviewed by the audit committee from time to time.
EXPLANATION OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSE REMARKS ORDISCLAIMERS MADE BY THE AUDITORS AND THE PRACTICING COMPANY SECRETARY:
There are no qualifications or observations or adverse remarks made by the StatutoryAuditors and Secretarial Auditors in their respective reports.
SELECTION AND PROCEDURE FOR NOMINATION AND APPOINTMENT OF DIRECTORS
The Company has a Nomination and Remuneration Committee ("NRC") which isresponsible for developing competency requirements for the Board based on the industryand strategy of the Company. The Board composition analysis reflects an in-depthunderstanding of the Company including its strategies environment operations financialcondition and compliance requirements.
The NRC makes recommendations to the Board with regard to the appointment of newDirectors and Key Managerial Personnel ("KMP") and senior management. The roleof the NRC encompasses conducting a gap analysis to refresh the Board on a periodic basisincluding each time a Director's appointment or re-appointment is required. The NRC isalso responsible for reviewing the profiles of potential candidates vis--vis therequired competencies undertake a reference and due diligence and meeting of potentialcandidates prior to making recommendations of their nomination to the Board. The appointeeis also briefed about the specific requirements for the position including expertknowledge expected at the time of appointment.
LISTING AT STOCK EXCHANGE
The Equity Shares of the Company are listed at Bombay Stock Exchange. The Companyconfirms that it has paid the Annual Listing fees for the year 2019-20 to BSE where theCompany's shares are listed.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is as follows: The particulars of the employees who are covered by theprovisions contained in Rule 5(2) and rule 5(3) of Companies (Appointment and Remunerationof Managerial Personnel) Rules 2014 are: a) Employed throughout the year- Nil b) Employedfor part of the year- Nil
During the year under review your Company has not invited any fixed deposit from thepublic in the terms of the provision of Section 73 to 76 of the Companies Act 2013 readwith the Companies (Acceptance of Deposits) Rules 2014.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING 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 readwith Rule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as"Annexure A".
All properties and insurable interests of the Company including building plant andmachinery and stocks have been insured.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In order to ensure that the activities of the Company and its employees are conductedin a fair and transparent manner by adoption of highest standards of professionalismhonesty integrity and ethical behavior the company has adopted a vigil mechanism policy.This policy is explained in Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The report on Management Discussion and Analysis as required under the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 with the Stock exchange is set out as 'Annexure B' to the Director's Report.
CORPORATE GOVERNANCE REPORT
The Company has complied with all the mandatory requirements of Corporate Governancespecified by Securities & Exchange Board of India (SEBI) through Listing Regulations2015. As required by the said regulations a separate Report on Corporate Governance formspart of the Annual Report of the Company as "Annexure D" to the Board Report.
COMPLIANCE OF SECRETARIAL STANDARDS
The Company has complied with the Secretarial Standards issued by the Institute ofCompany Secretaries of India on Board and General Meetings.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments in the business operations of the companyfrom the financial year ended 31st March 2020 to the date of signing of the Director'sReport.
DIRECTOR'S RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3) (c) of the Companies Act 2013:
a) that in the preparation of the annual financial statements for the year ended March31 2020 the applicable accounting standards have been followed along with properexplanation relating to material departures if any
b) that such accounting policies as mentioned in Notes to the Financial Statements havebeen selected and applied consistently and judgment and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of thecompany as on March 31 2020 and of the profit of the company for the year ended on thatdate
c) that proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities
d) that the annual financial statements have been prepared on going concern basis
e) that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
f) that systems to ensure compliance with provisions of all applicable laws were inplace and were adequate and operating effectively.
In accordance with General Circular No. 20/2020 dated May 5 2020 issued by Ministry ofCorporate Affairs and circular SEBI/HO/CFD/CMD1/CIR/P/2020/79 dated May 12 2020 issued bySEBI the Company has sent the Annual Report /Notice of AGM only through electronic modeto those Shareholders whose e-mail Ids were registered with the Company /RTA / DepositoryParticipants.
EXTRACTS OF ANNUAL RETURN
The extracts of annual return in Form MGT-9 as required under Section 92(3) and Rule 12of the Companies (Management and Administration) Rules 2014 is appended as an"Annexure C" to this Report.
RELATED PARTY TRANSACTIONS
The Policy on Related Party Transactions intends to ensure that proper reporting;approval and disclosure processes are in place for all transactions between the Companyand Related Parties.
All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. The particulars of contracts or arrangements withrelated parties referred to in section 188(1) and applicable rules of the Companies Act2013 in Form AOC-2 is provided as "Annexure E" to the Board Report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy. There were no complaints receivedduring the year under review.
CODE OF CONDUCT
Your Company is committed to conduct its business in accordance with the applicablelaws rules and regulations and highest standards of business ethics. In recognitionthereof the Board of Directors has implemented a Code of Conduct for adherence by theDirectors Senior Management Personnel and Employees of the Company. The Code of Conductis dealing with ethical issues and also fosters a culture of accountability and integrity.In this connection the draft Code of Conduct was placed before the Board along with therecommendations of the Audit Committee and the same was approved by the Board. The Boardhas laid down a Code of Conduct for all Board Members and Senior Management of theCompany. Board Members and Senior Management Personnel have affirmed Compliance with theCode for the Period 2019-20. A separate declaration to this effect is made out in theCorporate Governance Report. The Company has adopted code of practices and procedures forfair disclosure of unpublished price sensitive information and code of conduct as requiredunder Regulation (8)(1) and Regulation (9)(1) of the SEBI (Prohibition of Insider Trading)Regulations 2015.
Your Directors would like to express their grateful appreciation for the co-operationsreceived from its Bankers Government Authorities Customers Vendors and Shareholdersduring the year under review. Your Directors also wish to place on record their deep senseof appreciation for the committed services of the executives staff and workers of theCompany.
The statements contained in the Board's Report and Management Discussion and AnalysisReport contain certain statements relating to the future and therefore are forward lookingwithin the meaning of applicable securities laws and regulations. Various factors such aseconomic conditions changes in government regulations tax regime other statues marketforces and other associated and incidental factors may however lead to variation in actualresults.
Your Company's Board and employees are inspired by their vision of sustaining of theCompany as a dynamic and valuable Company through world class performance creatingenduring value for all stakeholders including the shareholders and the Indian Society.The Company is continuously engaged in upgrading strategic capability to effectivelyaddress the challenge of growth in an increasingly competitive market. The vision ofenlarging your Company's contribution to the Indian economy is manifest in the creation ofunique business models that foster international competitiveness. Propelled by this visionand powered by the internal vitality your Directors look forward to the future withconfidence.