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Sundaram Multi Pap Ltd.

BSE: 533166 Sector: Services
BSE 00:00 | 20 Jul 2.04 -0.01






NSE 00:00 | 20 Jul 2.05 0






OPEN 2.04
VOLUME 72066
52-Week high 6.50
52-Week low 2.00
P/E 15.69
Mkt Cap.(Rs cr) 55
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2.04
CLOSE 2.05
VOLUME 72066
52-Week high 6.50
52-Week low 2.00
P/E 15.69
Mkt Cap.(Rs cr) 55
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Sundaram Multi Pap Ltd. (SUNDARAM) - Director Report

Company director report

Dear Shareholders

On behalf of the Board of Directors it is our pleasure to present the 23rdAnnual Report together with the Annual Audited Statement of Accounts of Sundaram Multi PapLimited ("the Company") and its subsidiary for the year ended March 31 2017.


The financial performance of Company for the year ended March 31 2017 is summarizedbelow: (' In Lacs)




2016-17 2015-16 2016-17 2015-16
Total Income 9524.61 9631.88 10016.96 9892.35
Total Expenses (Excluding Finance Cost) 8221.94 8737.27 8600.16 8997.66
Profit / (Loss) before tax (650.43) (786.58) (648.44) (1017.13)
Less: Deferred Tax 217.34 144.00 61.75 144.00
Less: (Excess)/Short Provision for earlier Years 2.45 1.37 2.44 1.37
Profit / (Loss) after tax (430.64) (641.22) (584.25) (871.76)
EPS (0.19) (0.30) (0.26) (0.40)


The Consolidated revenue from the operations has increased to ' 10016.96 Lacs for theyear ended March 31 2017 as compared to ' 9892.35 Lacs for the year ended March 312016. The Company has reduced net loss after tax to ' 584.25 lacs for the year ended March31 2017 as compared to net loss of ' 871.76 lacs for the year ended March 31 2016.Earnings per Share of the Company have been improved.


E-Class Education System Limited brings to its customers Digital Education byleveraging the powers of Computers and using a blend of Internet Mobile and other meansof Digital Communication Technologies. E-class aims at educating the Majority of theStudents across the state by providing various products such as Smart phone ApplicationAndroid Memory cards Pen-drives etc. The Gross Revenue of the Company in Financial Year2016-17 stood at ' 489.79 lacs as Compared to ' 250.70 lacs in Previous Financial Year2015-16.


In view of the losses incurred by the Company your Directors propose not to transferany amount to General Reserve.


In view of the Loss incurred by your Company the Board of Directors does not recommendany dividend for the Financial Year 2016-17.


The extract of the Annual return of the Company pursuant to section 134(3) (a) of theCompanies Act 2013 in annexed herewith as Annexure-1 to this Report.


There have been no such material changes or commitments affecting the financialposition from the end of the Financial Year 2016-17 till date of this report as may bedeemed to be material enough to affect the financial position of the Company otherwisethan in the normal course of business.


During the year the Company has issued and allotted 30000000 Equity Shares of faceValue of '1/- each on Qualified Institutional Placement basis. As on March 31 2017 theissued subscribed and paid up share capital of your Company stood at ' 245605773/-(Rupe es Twenty Four Crores Fifty Six Lacs Five Thousand Seven Hundred and Seventy ThreeOnly) comprising 245605773 (Twenty Four Crores Fifty Six Lacs Five Thousand SevenHundred and Seventy Three) Equity shares of ' 1/- (Rupee One Only)each.


The Board met Sixteen (16) times during the Financial Year 2016-17 viz. on 23-05-201620-06-2016 07-07-2016 25-072016 08-08-2016 10-09-2016 09-11-2016 15-11-20162111-2016 24-11-2016 28-11-2016 19-12-2016 28-12-2016 05-01-2017 10-02-2017 and07-03-2017.

Detailed information on the meetings of the Board of Directors is included in thereport on Corporate Governance which forms part of this Annual Report. Maximum gapbetween two Board Meeting did not exceed 120 days as required under Companies Act 2013.


As per the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 as on March 31 2017 Company has fourCommittees namely Audit Committee Nomination & Remuneration Committee StakeholdersRelationship Committee and CSR Committee. The details of Composition of the said Committeeand their Meeting held during the year along with terms of reference of the saidCommittees of Board of Directors of the company is given in Corporate Governance Reportand is also placed on the Company's website at (http://www .


The Management Discussion and Analysis Report on the operations of the Company asrequired under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isprovided in a separate section and forms an integral part of this Report.


The Company is committed to maintain the highest standards of Corporate Governance andadheres to the Corporate Governance requirements as stipulated by SEBI. The report onCorporate Governance as prescribed in Regulation 34 (3) read with Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 forms an integral partof this Annual Report. The requisite certificate from the Auditors of the Companyconfirming compliance with the conditions of Corporate Governance along with a declarationsigned by the

Chairman and Managing Director stating that Members of the Board and Senior ManagementPersonnel have affirmed the compliance vide Code of Conduct of the Board and SeniorManagement is attached to the report on Corporate Governance. As per Regulation 34 (3)read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a separate section on corporate governance practices followed by theCompany together with a certificate from the Company's Auditors confirming complianceforms an integral part of this Report.


The Equity Shares of the Company are listed on the BSE Limited & NSE Limited.Shareholders are requested to convert their holdings to dematerialized form to derive itsbenefits by availing the demat facility provided by NSDL and CDSL.


Pursuant to the requirement under Section 134 (3) (c) of the Companies Act 2013 it ishereby confirmed that:

(a) In the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

(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 loss of the company for that period;

(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 have prepared the annual accounts on a going concern basis;

(e) The directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

(f) The directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


The Company has received necessary declarations from each Independent Director underSection 149(7) of the Companies Act 2013 that he/she meets the criteria for Independenceas laid down in Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.


The Current policy is to have an appropriate proportion of executive and independentdirectors to maintain the independence of the Board and separate its functions ofgovernance and management. As on March 31 2017 the Board consists of five membersincluding a managing director wholetime director and three are independent directors.

The Company has framed a Nomination Remuneration and Evaluation Policy. Theinformation with respect to the Company's policy on directors' appointment andremuneration including criteria for determining qualifications positive attributesindependence of a director and other matters provided under sub-section (3) of section 178and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 is outlined in the Annexure-2 of this report. The said policy is also available onCompany's website on POLICY.pdf. There has been no change inthe policy since last financial year.


Pursuant to the provisions of Section 134(3)(p) 149(8) 178 and Schedule IV of theCompanies Act 2013 and Regulation 17 the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 annual performance evaluation of Directors and Committeesof Director has been carried out. A structured questionnaire was prepared after takinginto consideration the various aspects of the Board's functioning composition of theBoard and its Committees culture execution and performance of specific dutiesobligations and governance. Board has carried out annual performance evaluation of its ownperformance performance evaluation of Committees of Board performance of IndependentDirectors and performance of the Chairman.

Executive Directors were evaluated on the basis of targets / criteria given to them bythe board from time to time as well as per their terms of appointment. IndependentDirectors being evaluated by entire board except of Director being evaluated on meetingtheir obligations connected with their independence criteria as well as adherence with therequirements of professional conduct roles functions and duties specifically applicableto Independent Directors as contained in Schedule IV of the Companies Act 2013. Chairmanand other NonIndependent Directors were being evaluated by Independent Directors who alsoreviewed the performance of secretarial department. Performance evaluation of theCommittees of the Board and that of its members in effectively discharging their dutieswas carries out by the Board of Directors based on the terms of reference of thecommittees.

The overall performance of Chairman Executive Directors and Non-Executive Directors ofthe Company is satisfactory. The review of performance was based on criteria ofperformance knowledge analysis quality of decision making etc.


• Re-appointment:

M/s. Bhuta Shah & Co. LLP Chartered Accountants Mumbai (ICAI Firm RegistrationNo.: W100100) Statutory Auditors of the Company were appointed as the Statutory Auditorsof the Company on September 30 2014 to hold the office for a period of three years i.e.up to the AGM to be held in the calendar year 2017.

The term of said appointment expires in this AGM however as per the provisions of theSection 139 of the Companies act 2013 they can further be re-appointed for the period ofOne Financial Year i.e. 2017-18 and in the event of their re-appoinmtment in this AGMtheir current term will expire in AGM to be held in calendar year 2018. The StatutoryAuditors have confirmed their consent and eligibility to the effect that theirreappointment if made would be within the prescribed limits under the Act and that theyare not disqualified for reappointment.

As required above the Board has after considering the recommendations of its AuditCommittee incorporated a suitable resolution for your consideration and approval in thenotice calling ensuing Annual General Meeting of the Company.

• Auditors Observations & Management's Response:

The auditor has emphasized over the matter of certain trade receivables and advanceswhich are subject to confirmation and reconciliation. However the management does notexpect any material variation affecting the current year's financial statement on suchreconciliation/ adjustments. Accordingly no provisions have been made in the financialstatements.

In Consolidated Financial Statement auditors have qualified opinion over the matter ofprovision for Gratuity that no provisions are made for gratuity by the Subsidiary Companywhich constitutes a departure from the Accounting Standard - 15 "Employee Benefits(Revised 2005)'. However management of the Subsidiary Company is in the process adoptingAS-15.

• Auditor's Certificate on Corporate Governance:

As required by SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the auditor's certificate on corporate governance is provided in this Annual Report.The certificate does not contain any qualification reservation or adverse remark.


• Appointment:

Pursuant to Section 204 of the Companies Act 2013 your Company had appointed M/s. A.V. Shah & Associates Practicing Company Secretaries Mumbai as its SecretarialAuditors to conduct the Secretarial Audit for FY 2016-17. The Company provided allassistance and facilities to the Secretarial Auditor for conducting their audit.

• Secretarial Audit Report:

The Secretarial Audit report on the compliance of the applicable Acts Laws RulesRegulations Guidelines Listing Agreement Standards stipulated by the provisionsof Section 204 of the Companies Act 2013 read with the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 forms part of this report as Annexure-3.The findings of the audit have been satisfactory.


The Company continues to engage M/s. Prakkash Muni & Associates (ICAI FirmRegistration No. 111792W) as its Internal Auditor for Financial Year 2017-18. During theyear the Company continued to implement their suggestions and recommendations to improvethe control environment. Their scope of work includes review of processes for safeguardingthe assets of the Company review of operational efficiency effectiveness of systems andprocessesand assessing the internal control strengths in all areas. Internal Auditorsfindings are discussed with the process owners and suitable corrective actions taken asper the directions of Audit Committee on an ongoing basis to improve efficiency inoperations.


Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 the Cost Audit Report is not mandatorily applicable to ourCompany for the financial year 2016-17; hence no such audit has been carried out duringthe year.


There have been no instances of frauds reported by Statutory Auditors under Section143(12) of the Companies Act 2013 and rules made thereunder either to the Company or tothe Central Government.


Except of Conversion of Loan amounting to '. 137000000 (Rupees Thirteen CroresSeventy Lakh) given to Wholly Owned Subsidiary viz. E-Class Education System Limited intoequity shares during the year there was no other loan given or guarantee given orinvestment made or security provided pursuant to Section 186 of the Companies Act 2013during the year under review and hence the said provisions are not applicable.


All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business and that the provisions of Section 188of the Companies Act 2013 and the Rules made thereunder are not attracted. Thusdisclosure in form AOC-2 in terms of Section 134 of the Companies Act 2013 is notrequired. Further there are no material related party transactions falling under Section188 (1) of the Companies Act 2013 during the year under review with the PromotersDirectors or Key Managerial Personnel. The Company has developed a framework throughStandard Operating Procedures for the purpose of identification and monitoring of suchRelated Party Transactions.

All Related Party Transactions were placed before the Audit Committee for approval.Audit Committee had given prior approval for all the Related Party Transactions. Alsopolicy on related party transaction has been disclosed on the website of the Company at(http:// www. policies/).

The Company has not entered into any contract / arrangement / transaction with relatedparties which could be considered material in accordance with the policy of the Company onmateriality of related party transactions.


The particulars relating to Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo as required to be disclosed under the Act are given below:


Steps taken on conservation of energy and for utilizing alternate sources of energy:

Company is well equipped with the transparent roofs in the factory premises; thetransparent roof drastically enables the company to reduce the artificial lightning. AlsoCompany had installed highly efficient machineries which help in conservation of energyand also factory premise is equipped with energy saving lamps. Company had also installedself-power generation unit. The self-power generator enables the company to overcome thebreakdown in the electricity supply and facilitates the continuous working of theproduction process without any hindrance.

The capital investment on energy conservation equipments: Capital Investments wereincurred in the earlier years but no investment was made on energy conservationsequipment's during the year 2016-17.


The efforts made towards technology absorption and benefits derived:

The Company is equipped with fully auto book manufacturing machine and has also adoptedpartly automation process. This has resulted into the reduction in the labour cost and thecycle time from raw material to the final output of the product. This technology hashelped the company to increase the output with better quality and low amount of wastage.

In case of imported technology:

No technology was imported by the Company during the last three years reckoned from thebeginning of the financial year.


Details of Foreign Exchange earnings & outgo is given in notes forming parts offinancial statements.


As per the provisions of the Companies Act 2013 Mr. Shantilal P. Shah (DIN: 00033182)retires by rotation at the ensuing Annual General Meeting and being eligible seeksre-appointment. The Board recommends the re-appointment.

Mr. Manik MakwanaCompany Secretary of the Company resigned from the office of CompanySecretary & KMP w.e.f. February 24 2017 and Mr. Bhavesh Chheda was appointed asCompany Secretary & KMP of the Company w.e.f. March 07 2017.

Mr. Krunal S. Shah (DIN: 07877986) was appointed as the Additional Director (Executive)of the Company w.e.f. August 08 2017.


Although the company has long been following the principle of risk minimization as isthe norm in every industry it has now become a compulsion. Therefore in accordance withRegulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015the Board members were regularly informed about risk assessment and minimizationprocedures after which the Board formally adopted steps for framing implementing andmonitoring the risk management plan for the company.

The main objective of this policy is to ensure sustainable business growth withstability and to promote a pro-active approach in reporting evaluating and resolvingrisks associated with the business. In order to achieve the key objective the policyestablishes a structured and disciplined approach to Risk Management in order to guidedecisions on risk related issues. In today's challenging and competitive environmentstrategies for mitigating inherent risks in accomplishing the growth plans of the Companyare imperative. The common risks inter alia are: Regulations Competition Business riskTechnology obsolescence Investments Retention of talent and Expansion of facilities.

Risk Management framework shall primarily focus on the elements such as Risk to CompanyAssets and Property Employees Related Risks Foreign Currency Risks Risks associatedwith Non-Compliance of Statutory enactments Competition Risks Operational Risks andvarious other types of risks which may affect the business or organization.

Business risk inter-alia further includes financial risk Political risk Fidelityrisk Legal risk. As a matter of policy these risks are assessed and steps as appropriateare taken to mitigate the same.

Pursuant to the provision of Regulation 21 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 with respect to the formation of the Risk ManagementCommittee is not applicable to your Company.

Detailed policy framework is disclosed on the website of the Company at (company-policies/).


The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business; including adherence to the Company's policies the safeguardingof its assets prevention and detection of fraud error reporting mechanism accuracy andcompleteness of Accounting Records and timely preparation of reliable financialdisclosures. policies the the safeguarding of its assets prevention and detection offraud error reporting mechanism accuracy and completeness of Accounting Records andtimely preparation of reliable financial disclosures. These have been designed to providereasonable assurance with regard to recording and providing reliable Financial andOperational information complying with applicable statutes safeguarding assets fromunauthorized use or losses executing transactions with proper authorization and ensuringcompliance of internal policies. The Audit Committee of the Board of Directors activelyreviews the adequacy and effectiveness of the internal control systems and suggestsimprovements to strengthen the same. The Company has in place adequate internal financialcontrols with reference to financial statements. During the year such controls weretested and no reportable material weakness in the design or operation was observed.


Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are provided in the Annexure-4 to this Report.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits set out in the said rules are mentioned in Annexure-5 to this report.


Pursuant to applicable provisions of Companies Act 2013 read with IEPF Authority(Accounting Audit Transfer and Refund) Rules 2016 Company have transferred unclaimeddividend amount of ' 54248/- pertaining to Financial Year 2008-09 to Investor EducationProtection Fund. Further according to rules the shares in respect of which dividend hasnot been claimed by the shareholders for seven consecutive years or more shall also betransferred to Demat account created by IEPF Authority. Accordingly Company hastransferred the unpaid or unclaimed dividend to the IEPF Account. The Corresponding shareswill be transferred as per the requirements of IEPF Rules. Details of Unpaid or UnclaimedDividend are displayed on Company's website at


As on March 31 2017 your Company has only one Wholly Owned Subsidiary viz. E-classEducation System Limited. During the year under review your Company did not have any NewSubsidiary neither did it have an Associate Company nor did it enter in to a Joint Venturewith any other company. In Accordance with Section 129 (3) of the Companies Act 2013 wehave prepared Annual Consolidated Financial Statements of the Company in accordance withrelevant Accounting Standards issued by the Institute of Chartered Accountants of Indiawhich form part of this Annual Report. Further pursuant to sub-section (3) of Section 129of the Act the statement containing the salient feature of the financial statement of acompany's subsidiary or subsidiaries associate company or companies and joint venture orventures is given as Annexure-4.


In line with the provisions of Section 135 of the Companies Act

2013 and the rules framed there under with respect to the Corporate SocialResponsibility (CSR) your Company has constituted a CSR Committee to recommend andmonitor expenditure on CSR and also approved the CSR Policy. The Company's policy on CSRis put up on the website of the Company at the link

Since there is average loss in the last three immediately preceding financial years ofyour Company; the management was not required to conduct any CSR related activities.However your management desires to spend on CSR as and when it's feasible. The AnnualReport on CSR activities is annexed herewith marked as Annexure-6.


During the year under review except of loan from Directors the Company has notaccepted any deposits within the meaning of Chapter V of the Companies Act 2013 read withthe Companies (Acceptance of Deposits) Rules 2014. Hence there are no details to bedisclosed under Rule 8(5) (v) of the Companies (Accounts) Rules 2014.


During the year under review no complaints has been received by Sexual HarassmentCommittee of the Company under The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.


There are no significant material orders passed by the Regulators / Courts / Tribunalwhich would impact the going concern status of the Company and its future operations.Hence disclosure pursuant to Rule 8 (5) (vii) of Companies (Accounts) Rules 2014 is notrequired.


Pursuant to the requirement of the Companies Act 2013 and provisions of ListingAgreement applicable to the Company your Company has adopted Vigil mechanism (WhistleBlower Policy) for complying with the Company's Code of Conduct and Ethics andparticularly to assuring that business is conducted with integrity and that the Company'sfinancial information is accurate. The reportable matters may be disclosed by theemployees to the Management / Managing Director / Chairman of the Audit Committee. Nocomplaint was received during the Financial Year 2016-17. During the year under review noemployee was denied access to the Audit Committee.


Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invests in attraction retention and development oftalent on an ongoing basis. A number of programs that provide focused people attention arecurrently underway. Your Company's thrust is on the promotion of talent internally throughjob rotation and job enlargement.


Your Company would like to bring to the notice of the shareholders that some of themhave not claimed the dividends as per the under mentioned detail:

Accounting Total amount
Year unclaimed (in ' )
2009-10 ' 67124
2010-11 ' 52317
2011-12 ' 48097
2012-13 ' 83641
2013-14 ' 74385

The Board of Directors sincerely likes to remind the concerned shareholders to claimtheir dividends. The Board also likes to inform to the shareholders that any dividendremaining unclaimed for seven years gets transferred to Investor Education &Protection Fund as per Section 125 of the Companies Act 2013. Further Board also informsthat pursuant to the provisions of Section 124 of the Companies Act 2013 those shares onwhich dividend has not been claimed since last seven years will be transferred to IEPFAccount. Intimation letters for the same has been already sent by Company to thoseshareholders on their registered address who have not claimed their dividend since lastseven years. Also advertisement for the same was published by the Company in thenewspaper.


In last AGM held on August 29 2016 Company had passed Special Resolution for issue ofShare Warrants to the Promoters on Preferential Basis however promoters could notsubscribe to the said Share Warrants within the specified hence said Share Warrants couldnot be allotted to the promoters.

Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:

a) Issue of equity shares with differential rights as to dividend voting or otherwise

b) Issue of shares (including sweat equity shares) to employees of the Company underany scheme

c) Voting rights which are not directly exercised by the employees in respect of sharesfor the subscription/purchase of which loan was given by the Company (as there is noscheme pursuant to which such persons can beneficially hold shares as envisaged undersection 67(3)(c) of the Companies Act 2013).


Statements in this Directors' Report and Management Discussion and Analysis describingthe Company's objectives projections estimates expectations or predictions may be"forward-looking statements" within the meaning of applicable securities lawsand regulations. Actual results could differ materially from those expressed or implied.Important factors that could make difference to the Company's operations include

raw material availability and its prices cyclical demand and pricing in the Company'sprinciple markets changes in Government regulations Tax regimes economic developmentswithin India and the countries in which the Company conducts business and other ancillaryfactors.


Your Directors place on record their appreciation for employees at all levels who havecontributed to the growth and performance of your Company.

Your Directors also thank the clients vendors bankers shareholders and advisers ofthe Company for their continued support.

Your Directors also thank the Central and State Governments and other statutoryauthorities for their continued support.

For and on behalf of the Board of Directors Sundaram Multi Pap Limited

Amrut P. Shah


Chairman & Managing Director

Date: August 08 2017

Place: Mumbai