Your Directors have pleasure in presenting this Seventy Second Annual report on theaffairs of the Company together with the Audited Statement of Accounts for the year endedon 31st March 2019.
A. The Extract of the Annual Return in form MGT-9:
The Extract of Annual Return required under Section 92(3) of the Companies Act 2013read with Rule 12(1) of the Companies (Management and Administration) Rules 2014 formspart of this report as Annexure-A.
Pursuant to section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014.
B. (I) Number of meetings of the Board:
During the year 2018-19 the Board of Directors met Five times viz. on 25th May 2018;10th August 2018; 14th September 2018 14th November 2018 and 13th February 2019.
Further the status of attendance of Board Meeting by each of Director is as follows:
|Sr. No. Date of Board Meeting ||No. of Board Meeting Entitled To Attend ||No. of Board Meeting Entitled To Attend |
|1 Mr. T. R. Swaminathan ||5 ||4 |
|2 Mr. R. S. Jhawar ||5 ||3 |
|3 Mr. Gobind Prasad Saraf ||5 ||5 |
|4 Mr. F. J. Guzdar ||3 ||3 |
|5 Ms. Kusum Dadoo ||5 ||5 |
Further the status of attendance of Board Meeting by each of Director is as follows:
|Sr.No. Date of Board Meeting ||Directors attending Board Meeting |
|1 25th May 2018 ||Mr. T. R. Swaminathan Mr. R. S. Jhawar Mr. Gobind Prasad Saraf Mr. F. J. Guzdar and Ms. Kusum Dadoo |
|2 10th August 2018 ||Mr. T. R. Swaminathan Mr. R. S. Jhawar Mr. Gobind Prasad Saraf Mr. F. J. Guzdar and Ms. Kusum Dadoo |
|3 14th September 2018 ||Mr. R. S. Jhawar Mr. Gobind Prasad Saraf Mr. F. J. Guzdar and Ms. Kusum Dadoo |
|4 14th November 2018 ||Mr. T. R. Swaminathan Mr. Gobind Prasad Saraf and Ms. Kusum Dadoo |
|5 13th February 2019 ||Mr. T. R. Swaminathan Mr. Gobind Prasad Saraf and Ms. Kusum Dadoo |
(II) Composition of Audit Committee and number of meeting of the Audit Committee.
The Audit Committee comprises of following Directors:
1. MR. T. R. SWAMINATHAN CHAIRMAN * (Retired on 01/04/2019)
2. MR. R. S. JHAWAR
3. MR. GOBIND PRASAD SARAF * (Retired on 01/04/2019)
4. MS. KUSUM DADOO
5. MR. F. J. GUZDAR - WHOLE TIME DIRECTOR * (Retired on 01/10/2018)
6. MR. RATAN KISHORE BHAGANIA (Appointed on 15/05/2019).
During the year 2018-2019 the Member of Audit Committee met Four times viz. 25thMay 2018; 10th August 2018; 14th November 2018 and 12thFebruary 2019.
C. Directors' Responsibility Statement:
Pursuant to the requirement under Section 134(3) (c) of the Companies Act 2013 withrespect to Directors' Responsibility Statement it is hereby confirmed that:
(i) in the preparation of the annual accounts for the financial year ended 31stMarch 2019 the applicable accounting standards had been followed along with properexplanation relating to material departures;
(ii) 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 2019 and of the profitand loss of the company for that period;
(iii) the Directors had taken proper and sufficient care for the 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) the Directors had prepared the annual accounts on a going concern basis; and
(v) the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
D. A statement on declaration given by Independent Directors under sub-section (6) ofsection 149;
All Independent Directors have given declarations that they meet the criteria ofIndependence as laid down under Section 149(6) of the Companies Act 2013 and andprovisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
E. Company's policy on Directors' appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a Director and othermatters provided under sub-section (3) of section 178;
The Policy of the Company on Directors' appointment and remuneration including criteriafor determining qualifications positive attributes independence of a Director and othermatters provided under subsection (3) of section 178 is appended as Annexure A to thisReport.
F. Comments on Auditors' Report
There are no qualifications reservations or adverse remarks or disclaimers made byM/s. V Singhi & Associates. Statutory Auditors in their report.
However with regard to qualification in Secretarial Audit Report regardingnon-appointment of Managing Director/Whole-Time Director/Manager within 6 months of theretirement of Whole-time Director from 1st October 2018 management wants toclarify that it was looking for suitable person for the post but was not able to find thesame. However the Company has appointed General Manager with effect from 22ndApril 2019.
G. Particulars of loans guarantees or investments under section 186:
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 and Schedule V of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) regulations 2015 are given in thenotes to the Financial Statements.
H. Related Party Transactions:
Particulars of contracts or arrangements with related parties are referred to insub-section (1) of Section 188 in the form AOC-2:
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business. All Related PartyTransactions are placed before the Audit Committee. Prior omnibus approval of the AuditCommittee is obtained for related party transactions wherever required and thetransactions entered into pursuant to the omnibus approval so granted are placed beforethe Audit Committee for reviewing on a quarterly basis.
The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website www.standardbatteries.co.in. None of the Directors has any pecuniaryrelationships or transactions vis-avis the Company.
Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule8(2) of the Companies (Accounts) Rules 2014:
1 . Details of contracts or arrangements or transactions not at arm's length basis: Nil
2. Details of material contracts or arrangement or transactions at arm's length basis:Nil
Your Directors regret their inability to recommend any Dividend for the year underreview.
J. Taxation Matters
Note forming part of the Financial Statements for the year ended 31st March2019 explains the position of the Company for pending Taxation matters.
K. Material Changes between the date of the Board report and end of financial year
There have been no material changes and commitments if any affecting the financialposition of the Company which have occurred between the end of the financial year of theCompany to which the financial statements relate and the date of the report.
L. The conservation of energy technology absorption foreign exchange earnings andoutgo in such manner as may be prescribed;
Since the Company has sold its Industrial undertakings to Exide Industries Ltd.effective February 1998 information on conservation of energy technology absorptionare no more relevant. There was no foreign exchange earnings and outgo stipulated underSection 134(3) (m) of the Companies Act 2013 read with Rule 8 of The Companies(Accounts) Rules 2014.
M. A statement indicating development and implementation of a risk management policyfor the company including identification therein of elements of risk if any which in theopinion of the Board may threaten the existence of the company;
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks to key business objectives Major risks identified by the businesses and functionsare systematically addressed through mitigating actions on a continuing basis. These arediscussed at the meetings of the Audit Committee and the Board of Directors of theCompany
The Company's internal control systems are commensurate with the nature of its businessand the size and complexity of its operations. These are routinely tested and certified byStatutory as well as Internal Auditors.
N. The details about the policy developed and implemented by the Company if any onCorporate Social Responsibility initiatives taken during the year;
The Company is not required to constitute a Corporate Social Responsibility Committeeas it does not fall within purview of Section 135(1) of the Companies Act 2013 and henceit is not required to formulate policy on Corporate Social Responsibility.
O. Statement indicating the manner in which formal annual evaluation has been made bythe Board of its own performance and that of its Committees and individual Directors
The formal annual evaluation has been done by the Board of its own performance and thatof its Committee and individual Directors on the basis of evaluation criteria specified inthe Nomination and Remuneration policy of the Company. A member of the Board/Committee didnot participate in the discussion of his/her evaluation.
> The financial summary or highlights :
|Particulars ||Year Ended 31.03.2019 ||Year Ended 31.03.2018 |
|Total Income from Operation ||22718110 ||8939918 |
|Profit before Interest & finance charges depreciation & taxation || || |
|Less: Interest & finance Charges ||- ||- |
|Operating profit before depreciation & taxation ||10046641 ||(1771220) |
|Less: Depreciation amortization & impairment of asset ||28159 ||33720 |
|Profit before Exceptional Items ||10018482 ||(1804940) |
|Add: Exceptional Items ||3000000 ||3000000 |
|Profit before taxation ||13018482 ||1195060 |
|Current Tax ||1811003 ||1782242 |
|Prior year Tax Provisions ||- ||- |
|Deferred Tax Liability ||- ||- |
|Profit after taxation ||11207479 ||(587182) |
|Add: Balance brought forward ||(79171212) ||(78584030) |
|Profit available for appropriation ||(67963733) ||(79171212) |
|Less: Appropriation: || || |
|Transfer to General Reserve ||- ||- |
|Interim Dividend ||- ||- |
|Tax on Interim Dividend ||- ||- |
|Proposed Dividend ||- ||- |
|Provision for Tax on Proposed Dividend ||- ||- |
|Less: Additional depreciation charged due to change in useful life ||- ||- |
|Balance carried forward to Balance Sheet ||(67963733) ||(79171212) |
The Company has achieved a turnover of Rs. 4882441.00 during the year under report ascompared to Rs. 1 7842690 during the previous year reflecting a Increase of 173.64% overthe previous year. The Net Profit of the Company during the year amounted to Rs.11207479.34 compared to net loss of Rs. 587181.93 in the previous year.
> the change in the nature of business if any; : N.A
> the details of Directors or Key Managerial Personnel who were appointed or haveresigned during the year:
(i) Mr. FAROK JIMI GUZDAR Whole-time Director retired from office with effect from01/10/2019.
(ii) As per the provisions of the Companies Act 201 3 and the Articles of Associationof the Company Mr. Gobind Prasad Saraf (DIN: 00206447) Independent Director whose termof office expired on 31st March 2019. He has been retired as an IndependentDirector w.e.f. 1st April. 2019.
(iii) As per the provisions of the Companies Act 2013 and the Articles of Associationof the Company Mr. Tippirajapuram Ramamirda Swaminathan (DIN: 00469558) IndependentDirector whose term of office expired on 31st March 2019. He has been retiredas an Independent Director w.e.f. 1st April. 2019.
(i) As per the provisions of the Companies Act 201 3 and the Articles of Associationof the Company Mr. R. S. Jhawar (DIN: 00023792) will retire in the ensuing Annual GeneralMeeting. He has intimated his intention not to seek re-appointment due to his advancedage.
(ii) As per the provisions of the Companies Act 2013 and the Articles of Associationof the Company Ms. Kusum Dadoo (DIN: 06967827) Independent Director whose term of officeexpires on 25th September 2019. The Board of Directors recommend herre-appointment.
(iii) As per the provisions of the Companies Act 201 3 and the Articles of Associationof the Company Mr. Ratan Kishore Bhagania (DIN: 02420026) has been appointed as anAdditional Director and Independent Director on 15th May 2019. The Board ofDirectors recommend his appointment.
(iv) As per the provisions of the Companies Act 201 3 and the Articles of Associationof the Company Mr. Hiren U. Sanghavi has been appointed as General Manager on 22ndApril 2019. The Board of Directors recommend approval to his appointment.
> the names of companies which have become or ceased to be its subsidiaries jointventures or associate companies during the year;: N.A
> the details relating to deposits covered under Chapter V of the Act: NA
> the details of deposits which are not in compliance with the requirements ofChapter V of the Act: N.A
> the details of significant and material orders passed by the regulators or courtsor tribunals impacting the going concern status and company's operations in future: N.A
> the details in respect of adequacy of internal financial controls with referenceto the Financial Statements.
The Company has in place an established internal control system designed to ensureproper recording of financial and operational information and compliance with variousinternal controls and other regulatory and statutory compliances.
i. AUDITORS AND THEIR REPORT
M/s. V Singhi & Associates Chartered Accountants having registration number FRNNo. 311017E were appointed as Statutory Auditors of your Company at the 70thAnnual General Meeting held on August 24 2017 for a term of five consecutive years. Asper the amended provisions of Section 1 39 of the Companies Act 2013 notified on 7thMay 2018 the appointment of Auditors is not required to be ratified by Members at everyAnnual General Meeting.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report.
ii. SECRETARIAL AUDITORS AND SECRETARIAL AUDIT REPORT
The Board has appointed M/s. R. N. Shah & Associates Company Secretaries inWhole-time Practice to carry out Secretarial Audit under the provisions of section 204 ofthe Companies Act 201 3 for the financial year 2018-19. The report of the SecretarialAuditor is annexed to this report as "Annexure B".
The report contains qualification as to Non-appointment of Managing Director/Whole-timeDirector/Manager within 6 months of the vacancy of the post as required under Section 203of the Companies Act 2013 and due to which proper constitution of the Board of Directorsis not as per the requirements of the said Act.
Reply by the Management:
The Management was trying to get the proper person for the post but was not able tofind the suitable person. However the Company appointed Mr. Hiren U. Sanghavi as GeneralManager on 22nd April 2019.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013 AND AS PER RULE 8(5)(X):
In order to prevent sexual harassment of women at work place the Company has adopted apolicy for prevention of Sexual Harassment of Women at workplace and has set up Committeefor implementation of said policy under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and during the year Company has notreceived any complaint of such harassment.
Disclosure pursuant to Section 197(12) of the Companies Act 2013 read with rule 5 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
|Requirements of Rule 5(1) ||Details |
|(i) the ratio of the remuneration of each Director to the median remuneration of the employees of the company for the financial year; ||Mr. Farok J. Guzdar - 198.56 W.T.D.* Retired on 01/10/2019 |
|(ii) the percentage increase in remuneration of each ||Mr. Farok J. Guzdar - No Increase |
|Director Chief Financial Officer Chief Executive Officer Company Secretary or Manager if any in the financial year; ||Mr. Shamrao Ramkisan Landge - Increase by 13.29% |
| ||Mr. Bhupendra N. Shah - No Increase |
|(iii) the percentage increase in the median remuneration of employees in the financial year; ||No increase |
|(iv) the number of permanent employees on the rolls of company; ||7 employees till 30.09.2018 then 6 employees as on 31.03.2019 * one employee (Whole-time Director) retired on 01.10.2018 |
|(v) average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration; ||No increase in Salaries of Employees during the Financial Year 2018-19. |
|(vi) Affirmation that the remuneration is as per the remuneration policy of the company. ||Remuneration paid during the year ended March 31 2019 is as per Remuneration policy of the Company. |
None of the employees has received remuneration exceeding the limit as stated in rule5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
> Vigil mechanism/whistle Blower Policy:
The Company has established a Vigil Mechanism/ Whistle Blower Policy for Directors andemployees to report their genuine concerns.
87.48% of the shares of the Company are in dematerialized form. Your Directors requestall the members who have not yet got their holding dematerialized to do so to enable easytrading of the shares as the shares of the Company are compulsorily traded indematerialized form.
In the previous year an out of the court settlement was reached with the agitatingWorkmen's Union This settlement was challenged by the workmen concerned who filled awrit petition in the High Court at Mumbai however the writ petition has so far not comeup for hearing The Company is in negotiation with the workers and expect to resolve thisissue shortly.
> Following details are also available on the website of the Company i.e onwww.standardbatteries. co.in
1. The details of such familiarisation programmes
2. The policy on Related Party Transactions
3. All the policies of determininig the code of conduct and the preservation of thedocuments.
> MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
In terms of the provisions of Regulation 34 (2) (e) of the Listing Regulations theManagement's discussion and analysis are as follows:
Statement made in this report describing the Company's objectives projectionestimates and expectations may be "forward-looking statements" within themeaning of applicable laws and regulations. Actual results may differ materially fromthose expressed or implied. Important factors that could make a difference to theCompany's operations include economic conditions affecting the Markets in which companyoperates; changes in the Government regulations; tax laws and other statutes andincidental factors.
INDUSTRY STRUCTURE AND DEVELOPMENT
Changing economic and business conditions and rapid growth of Business Environment arecreating an increasingly competitive market environment that is driving corporations totransform their operations. Companies are focusing on their core competencies and serviceproviders to adequately address these needs. The role of technology has evolved fromsupporting corporations to transforming their business.
OPPORTUNITIES AND THREATS
The performance of market in India has a direct correlation with the prospect ofeconomic growth and political stability. Though the growth projections for F.Y. 2019-20appear reassuring there are certain downside risks such as pace and shape of globalrecovery effect of withdrawal of fiscal stimulus and hardening of commodity prices.Accommodative monetary policies in advanced economies coupled with better growthprospects in Emerging Markets (EMs) including India are expected to trigger large capitalinflows in EMs which in turn could lead to inflationary pressures and asset price bubble.Our business performance may also be impacted by increased competition from local andglobal players operating in India regulatory changes and attrition of employees. Withgrowing presence of players offering advisory service coupled with provision of funds forthe clients' needs we would face competition of unequal proportion. We continuouslytackle this situation by providing increasingly superior customized services.
In financial services business effective risk management has become very crucial. YourCompany is exposed to credit risk liquidity risk and interest rate risks. Your companyhas in place suitable mechanisms to effectively reduce such risks. All these risks arecontinuously analysed and reviewed at various levels of management through an effectiveinformation system. The Company is having excellent Board of Directors who are experts inthe financial sector and are helping the Company in making good investment.
OUTLOOK AND FUTURE PROSPECTS
Competition continues to be intense as the Indian and foreign banks have entered theretail lending business in a big way thereby exerting pressure on margins. The erstwhileproviders of funds have now become competitors. Company can sustain in this competitiveenvironment only through optimization of funding costs identification of potentialbusiness areas widening geographical reach and use of technology cost efficienciesstrict credit monitoring and raising the level of customer service.
RISKS & CONCERNS
In today's complex business environment almost every business decision requiresexecutives and managers to balance risk and reward. Effective risk management is thereforecritical to an organization's success. Globalization with increasing integration ofmarkets newer and more complex products & transactions and an increasingly stringentregulatory framework has exposed organizations to newer risks. As a result today'soperating environment demands a rigorous and integrated approach to risk management.Timely and effective risk management is of prime importance to our continued success.Increased competition and market volatility has enhanced the importance of riskmanagement. The sustainability of the business is derived from the following:
(1) Identification of the diverse risks faced by the company.
(2) The evolution of appropriate systems and processes to measure and monitor them.
(3) Risk management through appropriate mitigation strategies within the policyframework.
(4) Monitoring the progress of the implementation of such strategies and subjectingthem to periodical audit and review.
(5) Reporting these risk mitigation results to the appropriate managerial levels.
As there are no subsidiaries of the company investment made in subsidiaries is nil.
The Company's relations with the employees continued to be cordial.
SEGMENT-WISE OR PRODUCT WISE PERFORMANCE
The Company operates in only single segment. Hence segment wise performance is notapplicable.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUENCY
Your Company has an effective system of accounting and administrative controlssupported by an internal audit system with proper and adequate system of internal checkand controls to ensure safety and proper recording of all assets of the Company and theirproper and authorised utilization. As part of the effort to evaluate the effectiveness ofthe internal control systems your Company's internal audit department reviews all thecontrol measures on a periodic basis and recommends improvements wherever appropriate.The internal audit department is manned by highly qualified and experienced personnel andreports directly to the Audit Committee of the Board. The Audit Committee regularlyreviews the audit findings. An Information Security Assurance Service is also provided byindependent external professionals. Based on their recommendations the Company hasimplemented a number of control measures both in operational and accounting related areasapart from security related measures.
Your Directors take this opportunity to place on record their appreciation and sinceregratitude to the Government of India Government of Maharashtra Authorities and theBankers to the Company for their valuable support and look forward to their continuedco-operation in the years to come.
Your Directors acknowledge the support and cooperation received from the employees andall those who have helped in the day to day management.
| ||For and on behalf of the Board of Directors |
|Place: Kolkata ||R.S. JHAWAR |
|Dated: May 30 2019 ||(DIN: 00023792) |
| ||DIRECTOR |