Sunrise Industrial Traders Ltd.
|BSE: 501110||Sector: Financials|
|NSE: N.A.||ISIN Code: INE371U01015|
|BSE 00:00 | 25 Jan||Sunrise Industrial Traders Ltd|
|NSE 05:30 | 01 Jan||Sunrise Industrial Traders Ltd|
Sunrise Industrial Traders Ltd. (SUNRISEINDL) - Director Report
Company director report
SUNRISE INDUSTRIAL TRADERS LIMITED
SUNRSE INDUSTRIAL TRADERS LIMITED
Your Directors have pleasure in presenting their Forty-Eighth Annual Report on thebusiness and operations of the Company and the accounts for the Financial Year ended 31stMarch 2020.
1. Financial summary or highlights/Performance of the Company (Standalone)
A summary of the Company's financial Results (Standalone) for the Financial Year2019-2020 is as under:
Your company reported decrease in revenue from operations of 13.44% over the previousyear. At standalone level the revenue from operations stood at Rs. 5.67 Crores comparedwith Rs. 6.55 Crores in the previous year. The Net Loss after tax for the year stood atRs. 2.63 Crores against Profit of Rs. 2.64 Crores reported in the previous year.
The consolidation of financial statement of the Company for the year ended 31stMarch 2020 is not applicable as the company's does not have any subsidiary companies.
*The reason for decrease in Net Profit in comparison to last year is due to ExceptionalItem as the Company has written-off certain investments of IL&FS Group DHFL and YESBank to the tune of Rs. 729.88 Lakhs. The credit rating agencies have downgraded IL&FSGroup DHFL and YES Bank's credit rating to junk status. Also refer to Note No. (23) ofthe Financial Statement for the current year.
The Company adopted Indian Accounting Standards (Ind AS) from April 1 2019.The figuresof previous year are also recast / re-grouped to be Ind AS compliant as the transitionaldate for adoption of Ind AS for your company is April 1 2018. These annual financialstatements are the first financial statements of the company under Ind AS. Impact of suchfirst-time adoption of Ind AS as compared to precious GAAP is given in the annexedFinancial Statements.
2. Brief description of the Company's working during the year/State of Company's affair
The Company has one segment viz. investment in securities etc.
3. Change in the nature of business & Deposits
There is no change in the nature of business of the Company during the financial year2019-20. The Company is a NonBanking Financial Institution (NBFI) (without acceptingpublic deposits) registered under section 45-IA of the Reserve Bank of India Act 1934withthe RBI vide Regt. No. B-13.01546. The Company has complied with and continuous to complywith all applicable laws rules regulations etc. including directions of the RBI and itdoes not carry on any activities other than those specifically permitted by the RBI forNBFIs. The Company did not hold any deposits at the beginning of the year nor has itaccepted any public deposits during the year under review.
In order to conserve resources the directors have not recommended any dividend for theyear ended 31st March 2020 (P.Y.: NIL). The Company is outside purview ofRegulation 43A of the SEBI Listing Regulations 2015 and hence the formulation of"Dividend Distribution Policy" is not applicable to the Company.
The Board proposes to carry the Net Loss After taxation of Rs. 263.44 Lakhs for thefinancial year 2019-2020 to the General Reserves Account (P.Y.: NPAT - Rs.264.17 Lakhs).
6. Share Capital
There is no change in the Authorized Share Capital of the company. The Company has notissued any shares during the year. 476875 equity shares (95.57%) of the Company are inDemat form and 22125 equity shares (4.43%) are in physical form as on 31-03-2020. TheCompany has appointed M/s Kfin Technologies Private Limited. as the Registrar & ShareTransfer Agent for dealing with both Physical & Electronic shares. The Company'ssecurities are admitted in the Central Depository Service (India) Ltd & the NationalSecurities Depository Ltd. and the ISIN Number allotted to the Company by them in respectof Equity Shares is INE371U01015.
7. Directors Key Managerial Personnel Independent Directors & Compliance OfficerCHANGE IN DIRECTORS
As per Article No. 127 of the Articles of Association of the company Mr. Dhanesh. B.Raheja (DIN -00145896) Director of the Company will retire by rotation and being eligibleoffered himself for re-appointment at the ensuing 48th Annual General Meetingof the members of the Company. The Board recommends his re-appointment. The brief profileof Mr. Dhanesh B. Raheja has been given in the Notice convening the Annual GeneralMeeting.
Pursuant to section 149 of Companies Act 2013 and other applicable provision of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 and other amendmentsfrom time to time the Company at their Board meeting dated 07-02-2020 has approvedre-appointment of Mr. Vineetkumar Khanna (DIN: 00436703) as an Independent Non-ExecutiveDirector of the Company for a second consecutive term of 5 (five) years w.e.f 16thMarch 2020 to 15th March 2025 (both days inclusive) subject to shareholdersapproval in 48th Annual General Meeting.
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 Regulation16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
KEY MANAGENRIAL PERSONNEL & COMPLIANCE OFFICER The following are the KMP of theCompany:
1) Mr. Suresh. B. Raheja - Whole-time Director & CEO
2) Mr. Alkesh. S. Raheja - Chief Financial Officer
3) Ms. Priyanka R. Daroga - Company Secretary and Compliance Officer
The policy on directors' appointment and remuneration approved by the board ofdirectors is available on www.sunriseindustrial.co.in
8. Particulars of Remuneration to its Employees / Directors / Key Managerial Personnel
The information required under the provisions of Section 197 read with Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respectof employees of the Company and Directors is furnished below:
(*) Mr. Suresh. B. Raheja is a relative (brother) of Mr. Dhanesh. B. Raheja Directorof the Company & Mr. Suresh. B. Raheja is holding 134450 (26.94%) equity shares ofthe Company.
(**) Mr. Alkesh. S. Raheja is a relative of Mr. Suresh. B. Raheja Whole-time Director& is holding 36500 (7.31%) equity shares of the Company.
Other Disclosures pursuant to Rule 5(2) & 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014:
Pursuant to the provisions of 178(3) of the Act the Board has framed a remunerationpolicy which lays down a framework in relation to remuneration of directors keymanagerial personnel and senior management of the Company. This policy also lays downcriteria for selection and appointment of Board Members and their remuneration is that -
Remuneration to Key Managerial Personnel and Staff is industry driven in whichit is operating considering the performance leverage and factors such as to attract andretain quality talent.
For Whole-time Director it is based on the recommendation of the Nomination andRemuneration Committee ("NRC") and resolution passed by the Board of Directorsand shareholders resolution provisions of the Companies Act 2013 and Rules framedtherein and guidelines issued by Central Government and other authorities from time totime. The remuneration package of whole-time director comprises of salary. Annualincrement is linked to performance and are decided by NRC and recommended to the Board forapproval thereof.
The Non-Executive Directors are paid remuneration by way of sitting fees forattending meetings of the Board of Directors and the Audit Committee constituted by theBoard of Directors of the Company.
The remuneration policy is displayed on the Company's website viz.www.sunriseindustrial.co.in .
The information required under Section 197 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofDirectors/ employees of your Company is set out in "Annexure III" to this reporti.e. "MGT-9-Extract of Annual Return". The Extract of Annual Return is displayedon website of Company viz www.sunriseindustrial.co.in .
9. Board Meetings
The details of the number of meetings of the Board held during the Financial Year2019-2020 forms part of the Corporate Governance Report. The intervening gap between theMeetings was within the period prescribed under the Companies Act 2013.The Company hascomplied with the applicable Secretarial Standards issued by the Institute of CompanySecretaries of India.
10. Annual Performance Evaluation
In compliance with the provisions of the Act and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the performance evaluation was carried out asunder:
In accordance with the criteria suggested by the Nomination and Remuneration Committeethe Board of Directors evaluated the performance of the Board having regard to variouscriteria such as Board composition Board processes and Board dynamics. The IndependentDirectors at their separate meeting also evaluated the performance of the Board as awhole based on various criteria. The Board and the Independent Directors were of theunanimous view that performance of the Board of Directors as a whole was satisfactory.
Committees of the Board:
The performance of the Audit Committee the Corporate Social Responsibility Committeethe Nomination and Remuneration Committee and the Stakeholders Relationship Committee wasevaluated by the Board having regard to various criteria such as committee compositioncommittee processes and committee dynamics. The Board was of the unanimous view that allthecommittees were performing their functions satisfactorily and according to the mandateprescribed by the Board under theregulatory requirements including the provisions of theAct the Rules framed thereunder and the Listing Agreement/SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
(a) Independent Directors: In accordance with the criteria suggested by the Nominationand Remuneration Committee the performance of each independent director was evaluated bythe entire Board of Directors (excluding the director being evaluated) on variousparameters like qualification experience availability and attendance integritycommitment governance independence communication preparedness participation and valueaddition. The Board was of the unanimous view that each independent director was a reputedprofessional and brought his/her rich experience to the deliberations of the Board. TheBoard also appreciated the contribution made by all the independent directors in guidingthe management inachieving higher growth and concluded that continuance of eachindependent director on the Board will be in the interest of the Company.
(b) Non-Independent Directors: The performance of each of the non-independent directors(including the Chairperson) was evaluated by the Independent Directors at their separatemeeting. Further their performance was also evaluated by the Board of Directors. Variouscriteria considered for the purpose of evaluation included qualification experienceavailability and attendance integrity commitment governance communication etc. TheIndependent Directors and the Board were of the unanimous view that each of thenon-independentdirectors was providing good business and people leadership.
11. Details of Subsidiary/Joint Ventures/Associate Companies
The Company has no Subsidiary/Joint Ventures Company/ Associate Company as on 31stMarch 2020 as detailed in Form AOC-1 (Annexure I).
12. Auditors & Auditor's Report
M/s. Arunkumar K. Shah & Co. Chartered Accountants (Firm Registration No.126935W) Mumbai the Statutory Auditors of the Company hold the office up to theconclusion of the Annual General Meeting to be held in year 2023 and subject toratification in this Annual General Meeting till the conclusion of Next Annual GeneralMeeting with remuneration as mutually agreed between them and the Board of Directors ofthe Company and the said Auditors be paid out-of-pocket expenses incurred by them inconnection with the audit of accounts of the Company."
As required under Regulation 18 read with Part C of Schedule II of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Audit Committee and theBoard of Directors recommend the ratification of appointment of M/s. Arunkumar K. Shah& Co. Chartered Accountants (Firm Registration No. 126935W) Mumbai) as theStatutory Auditors of your Company for the financial year 2020- 2021 from the conclusionof this Annual General Meeting (AGM) till the conclusion of the AGM to be held in year2023 of the Company. The Company has received a certificate from the Auditors that iftheir appointment is made it will be within the prescribed limit under the provisions ofthe Companies Act 2013.
The Auditors of the Company have observed that they have neither come across anyinstance of fraud on or by the Company its officers or employees noticed or reportedduring the period.
There is no audit qualification reservations or adverse remarks in the auditor'sreport for the year ended 31st March 2020. The notes on financial statements referred toin the Auditors' Report are self-explanatory and do not call for any further comments.
13. Cost Auditor
The Cost Audit Orders / Rules are not applicable to the Company as the Company is anInvestment company and hence appointment of the cost auditor is not applicable.
14. Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorsof the company have appointed Mr. Kishor V. Ved Practicing Company Secretary toundertake the Secretarial Audit for the financial year ended 31st March 2020.The report of the Secretarial Auditor's in Form No. MR-3 is enclosed as Annexure II tothis report.
15. Secretarial Standards
The Company has complied with the Secretarial Standards on meetings of the Board ofDirectors including Committee of Directors and General Meetings issued by ICSI
16. Internal Audit
Pursuant to the provisions of Section 138 of the Act the Company have appointed M/s.Bhadresh Purohit & Associates Chartered Accountants (M. No. 39663) Mumbai as theInternal Auditor for the financial year 2019-2020. During the year the Company continuedto implement their suggestions and recommendations to improve the control environment.Their scope of work includes review of processes for safeguarding the assets of theCompany review of operational efficiency effectiveness of systems and processes andassessing the internal control strengths in all areas. Internal Auditors findings arediscussed with the Audit Committee and suitable corrective actions taken as per thedirections of the Audit Committee on an ongoing basis to improve efficiency in operations.
The Company continues to engage M/s. Bhadresh Purohit & Associates as its InternalAuditor for the financial year 2020-2021.
17. Issue of employee stock options
Presently the Company does not have a stock options scheme for its Directors and itsemployees.
18. Vigil Mechanism / Whistler Blower Policy
Pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013 andRegulation 22 of the Listing Regulations a Vigil Mechanism / whistle blower policy fordirectors and employees to report genuine concerns or grievances for redressal. The VigilMechanism / Whistle Blower Policy have been uploaded on the website of the Company atwww.sunriseindustrial.co.in under investors' link.
19. Risk management
Risk management is embedded in your Company's operating framework. Your Companybelieves that managing risks helps in maximizing returns. The Company's approach toaddressing business risks is comprehensive and includes periodic review of such risks anda framework for mitigating controls and reporting mechanism of such risks. The riskmanagement framework is reviewed periodically by the Board and the Audit Committee. TheCompany has been addressing various risks impacting and the policy of the company on riskmanagement is provided in Management Discussion and Analysis in the Annual Report.
20. Management Discussion and Analysis
As required under the SEBI (LODR) Regulations 2015 the Management Discussion andAnalysis (MRA) for the year ended 31st March 2020 and gives the state ofaffairs of the business of the company are as under:
The MRA contains forward-looking statements based on certain assumptions andexpectations of future events.
The Company therefore cannot guarantee that these assumptions and expectations areaccurate or will be realized. The Company's actual results performance or achievementscan thus differ materially from those projected in any such forward-looking statements.The Company assumes no responsibility to publicly amend modify or revise anyforward-looking statements on the basis of any subsequent developments information orevents.
The Company has income from operations of Rs. 5.67 Crores during the current year asagainst Rs. 6.55 Crores during the previous year. The Company is an Investment Company andoperates in one segment viz. investment in shares etc.
The market is expected to improve slowly during the year 2020-2021.
Our strength is our determination and team work weakness is the low equity baseopportunities are multiples and threats are the vibrations in the economy and governmentpolicies.
Management has put in place effective Internal Financial Control Systems to providereasonable assurances for safeguarding assets and their usage maintenance of properaccounting records and adequacy and reliability of the information used in financialstatements for carrying on business operations.
The Company has appointed an internal auditor to ensure compliance and effectiveness ofthe internal control systems in place. The Audit committee is regularly reviewing theinternal audit reports for the audit carried out in all key areas of the operations.
Normal foreseeable risks of the company's assets are adequatelyassessed and inspectionsare carried out periodically. The highlights of financial operational performance aregiven below:
RISKS AND CONCERNS
In any business risks and prospects are inseparable. As a responsible management theCompany's principal endeavor is to maximize returns. The Company continues to take allsteps necessary to minimize its expenses through detailed studies and interaction withexperts.
In this Management's Discussion and Analysis detailing the Company's objectivesprojections estimates estimates expectations or predictions are "forward-lookingstatements" within the meaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed or implied.
Statements in the management discussion and analysis and directors report describingthe company's strength strategies and estimates and forward-looking statements within themeaning of the applicable laws and regulations Actual results may vary from expressed orimplied depending upon economic conditions government policies and other incidentalfactors.
21. Extract of Annual Return
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in FormMGT-9 as a part of this Annual Report is enclosed as an Annexure III. Directors' Reportshall be also available at the Website of the Company under Extract of Annual Return andthe web-link of the same is www.sunriseindustrial.co.in under investor's relations/Extract of Annual Return.
22. Material changes and commitments if any affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report
There are no material changes occurred subsequent to the close of the financial year ofthe Company to which the balance sheet relates and the date of the report like settlementof tax liabilities depression in market value of investments institution of cases by oragainst the company sale or purchase of capital assets or destruction of any assets etc.
23. 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 are no such orders passed by regulators or courts or tribunals etc.
The Company has not accepted any depositsfrom public during the financial year underreview.
25. Particulars of loans guarantees or investments under section 186 of the Act
The Company has not granted any loans or guarantees etc. as covered under section 186of the Companies Act 2013. The Company is an investment company registered as aNon-Banking Financial Institution with the Reserve Bank of India and one segment viz.investments in shares securities etc. and hence section 186 of the Companies Act 2013is not applicable.
26. Particulars of contracts or arrangements with related parties
The company has entered into contracts or arrangements with the related partiesreferred to in sub-section (1) of section 188 of the Companies Act 2013 in the ordinarycourse of business on arms' length basis during the financial year and the same isdisclosed in Form AOC-2 (Annexure IV). All related party transactions are placed beforethe Audit Committee and the Board for approval. The policy on Related Party Transactionsas approved by the Board of Directors has been uploaded on the website of the Company viz.www.sunriseindustrial.co.in . None of the Directors has any pecuniary relationship ortransactions vis-a-vis the company except remuneration and sitting fees.
27. Corporate Governance Certificate
A separate section on compliance with the conditions of Corporate Governance as perRegulation 34(3) read with Schedule V of the SEBI LODR Regulations 2015 and areport onCorporate Governance approved by the Board of Directors of the Company and a certificatefrom Mr. Kishor V. Ved Practicing Company Secretary Mumbai for the year ended 31stMarch2020 are set out in the Annexure V to the Directors' report. The Company has complied withthe Corporate Governance practices specified under the Companies Act 2013 and the SEBI(LODR) Regulations 2015.
28. Disclosure as per the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013
In order to prevent sexual harassment of women at work place a new act viz. the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified.
Under the said Act the company has set up an Internal Complaint Committee to look intoprevention prohibition and redressal of complaints / grievances on the sexual harassmentof women at work places of any women employees. During the year under review the Companyhas not received any complaints of harassment. It is to be noted that the Company has six(6) employees and hence the provisions of the above-mentioned Act is not applicable tothe Company.
29. Conservation of energy technology absorption and foreign exchange earnings andoutgo
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read with theRule 8(3) of the Companies (Accounts) Rules 2014 is are as follows:
a) Conservation of energy
b) Technology absorption
30. Corporate Social Responsibility (CSR)
Pursuant to the provision of Section 135 of the Companies Act 2013 ("theAct") read with the Companies (Corporate Social Responsibility Policy) Rules 2014the Company has constituted a CSR Committee. Mr. Vineetkumar L. Khanna is the Chairman ofthe Committee and Mr. Dhanesh. B. Raheja and Mrs. Nita Desai are the other members. TheCompany is committed to good Corporate Citizenship. As a part of its corporate socialresponsibility the Company continues to undertake a range of activities includingpreventive healthcare.
It is to be noted that for financial year 2019-2020 the provision of Section 135 ofthe Companies Act 2013 are not applicable to the Company due to the following:
a) Net worth of the Company is less than Rs. 500.00 crores for F.Y. 2018-2019
b) Turnover is less than Rs. 1000.00 crores for F.Y. 2018-2019.
c) Net Profit Before Tax is less than Rs. 5.00 Crores for F.Y. 2018-2019.
In view of the above the Company is not required to spend any amount on CSR activitiesduring the F. Y. 20192020. However the Company still continue with the existing CSRCommittee and comply with the provisions of Section 135 (2) to (4) of the Act. The Boardhereby ensures the compliance of Section 135 of the Act and the Rules made thereunder infuture.
31. Human Resources
Your Company treats its own employees as "human resources" one of its mostimportant assets. Your Company continuously invests in attraction retention anddevelopment of talent on an ongoing basis. Your Company thrust is on the promotion oftalent internally through job rotation and job enlargement.
32. Directors' Responsibility Statement
As required under the provisions of Section 134 of the Act your directors report that
(a) in the preparation of the annual accounts for the financial year the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures;
(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 date;
(c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis;
(e) the directorshad laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
33. Internal Control Systems and their Adequacy
Your company has an effective Internal Control and risk mitigation systems which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is commensurate with its size scale and complexities ofits operations the internal and operational audit is entrusted to the Internal auditor totest and review controls appraisals of risks and business processes besides benchmarkingcontrols with bets practice in the industry.
34. Transfer of Amounts to Investor Education and Protection Fund
Your Company did not have any funds lying unpaid or unclaimed for a last seven yearsand hence no funds are required to be transferred to Investor Education and ProtectionFund.
35. Listing with the Stock Exchange
The Company confirms that it has paid the Annual Listing Fees for the year 2020-2021tothe BSE where the Company's Shares are listed.
36. Committees of the Board
The Board of Directors has the following Mandatory Committees:
a) Audit Committee
b) Stakeholders' Relationship Committee
c) Nomination and Remuneration Committee.
d) Corporate Social Responsibility Committee.
The details of the Committees along with their composition number of meetings held andattendance at the meetings are provided in the Corporate Governance Report.
37. Business Responsibility Report
The Business Responsibility Report as required by Regulation 34(2) of the SEBI LODRRegulations 2015 is not applicable to the Company as the company is not listed based onmarket capitalization calculated as 31st March 2020.
An acknowledgement to all with whose help cooperation and hard work the Company isable to achieve the results
39. Statutory Disclosures
There were no transactions / events with respect to the following items during theperiod under review and accordingly no disclosure or reporting is required with respectto the same:
a) Issue of equity with differential rights as to dividend / voting or otherwise
b) Receipt of any remuneration or commission by the managing director / whole-timedirector of the Company from any its subsidiaries
c) Buy-back of shares.
PLACE: MUMBAI DATE: 4th July 2020
Annexure - I
(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 ofCompanies (Accounts) Rules 2014) Statement containing salient features of the financialstatement of subsidiaries/associate companies/joint ventures Part "A":Subsidiaries (Information in respect of each subsidiary to be presented with amountsin Rs.)
Part "B": Associates - Statement pursuant to Section 129 (3) of the CompaniesAct 2013 related to Associate
Companies and Joint Ventures