Your Directors have pleasure in submitting their 25th Annual Report of the Companytogether with the Audited Statements of Accounts of the Company for the year ended on 31stMarch 2018.
During the year under review the Company has achieved Comprehensive Income of ' 36.82Lakhs However your Directors look forward to improve the financial position of theCompany and are optimistic about the future growth and performance of the Company.
The summarized financial results of the Company for the period ended 31st March 2018are as follows:
(Rs. In Lakh)
|Particulars || |
| ||2017-18 ||2016-17 ||2017-18 |
|Sales ||20648.76 ||20599.05 ||20678.69 |
|Other Income ||25.48 ||33.10 ||25.57 |
|Total Income ||20674.24 ||20632.15 ||20704.26 |
|Less: Expenditure ||18986.62 ||20563.01 ||19020.31 |
|Profit/(loss)before Interest Depreciation Tax ||1687.62 ||1631.11 ||1683.95 |
|Less: Interest ||950.19 ||933.71 ||950.19 |
|Less: Depreciation & Amortization Cost ||639.33 ||628.26 ||639.33 |
|Less: Extraordinary items ||0 ||0 ||0 |
|Profit/(loss)Before Tax ||98.10 ||69.14 ||94.43 |
|Less: Tax Expenses ||59.41 ||26.40 ||59.41 |
|Profit/(loss)after Tax ||38.69 ||42.74 ||35.02 |
|Other Comprehensive Income ||(1.87) ||0.41 ||(1.87) |
|Total Comprehensive Income for the period ||36.82 ||43.15 ||33.15 |
CONSOLIDATED FINANCIAL STATEMENT
The Consolidated Financial Statements for the Financial year 2017-18 of the Company areprepared in accordance with relevant Indian Accounting Standards issued by the Instituteof Chartered Accountants of India and form part of this Annual Report.
INDIAN ACCOUNTING STANDARDS (Ind AS)
As mandated by the Ministry of Corporate Affairs the Company has adopted IndianAccounting Standards ("Ind AS") from 1st April 2017 with a transition date of1st April 2016. The Financial Results for the year 2017-18 have been prepared inaccordance with Ind AS prescribed under Section 133 of the Companies Act 2013 read withthe relevant rules issued there under and the other recognized accounting practices andpolicies to the extent applicable. The Financial Results for all the periods of 2017-18presented have been prepared in accordance with Ind AS. MANAGEMENT DISCUSSION AND ANALYSISREPORT:
As required under Regulation 34 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. the Management Discussion and Analysis Report isenclosed as a part of this report. CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:
Your company is committed to good Corporate Governance and has taken adequate steps toensure that the requirements of Corporate Governance as laid down in Regulation 27 of SEBI(LODR) Regulations 2015 are complied with. The details are given in Annexure-"A".
LISTING WITH STOCK EXCHANGES:
The Company confirms that it has paid the Annual Listing Fees for the year 2018-19 toBSE where the Company's Shares are listed.
DEMATERIALISATION OF SHARES:
99.38% of the company's paid up Equity Share Capital is in dematerialized form as on31st March 2018 and balance 0.62% is in physical form. The Company's Registrars are M/sMCS share transfer agent Ltd. having their office at 201 Shatdal Complex 2nd floorOpp. Bata Show room Ashram Road Ahmedabad Gujarat - 380009.
Number of Board Meetings held:
During the year under review the Board duly met Four (4) times on 26/04/201727/07/2017 13/ 10/2017 and 11/01/2018 in respect of said meetings proper notices weregiven and proceedings were properly recorded and signed in the Minute Book maintained forthe purpose. For further details please refer Corporate Governance Report.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 Directors of your Company herebystate and confirm that:
a) In the preparation of the annual accounts for the year ended 31st March 2018 theapplicable accounting standards have been followed along with proper explanation relatingto material departures;
b) They have selected such accounting policies and applied them consistently and madejudgments and estimates that are Reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitof the company for the same period;
c) The directors have 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) They have prepared the annual accounts on a going concern basis;
e) They have laid down internal financial controls with reference to financialstatements in the company were operating effectively.
f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and these are adequate and are operating effectively.
There are no qualifications reservations or adverse remarks made by M/s. Rinkesh Shah& Co. Chartered Accountants the statutory Auditors of the Company in their report.The observations made by the statutory Auditors in their report for the financial periodended 31st March 2018 read with the explanatory notes therein are self explanatory andtherefore do not call for any further explanation or comments from the Board underSection 134(3) of the Companies Act 2013. AUDITORS:
i) Statutory Auditors:
M/s. Rinkesh Shah & Co. Chartered Accountants were appointed as statutoryAuditors fora period of 5 year(s) in the Annual General Meeting held on 20th June 2017 tohold the office till the conclusion of 29th Annual General Meeting of the Company to beheld in the year 2022. Pursuant
to the provisions of Section 139 of the Companies Act 2013 read with the Companies(Audit and Auditors) Rules 2014 the Company shall place the matter relating to suchappointment for ratification by members at every annual general meeting and therefore itis proposed to ratify the appointment ofM/s. Rinkesh Shah & Co. CharteredAccountants as the statutory Auditors of the Company. The consent of M/s. Rinkesh Shah& Co. Chartered Accountants Ahmedabad along with certificate under Section 139 ofthe Act has been obtained to the effect that their appointment if made shall be inaccordance with the prescribed conditions and that they are eligible to hold the office ofAuditors of the Company.
ii) Cost Auditors:
M/s. Kiran J. Mehta & Associates Cost Accountants (FRN: 00025) appointed by theBoard of Directors of the Company to conduct the audit of the Cost records of the Companyfor the financial year 2017-18 be paid the remuneration as set out in the statementannexed to the notice convening this meeting.
iii) Secretarial Audit:
As per the provisions of Section 204 read with Section 134(3) of the Companies Act2013 our Company needs to obtain Secretarial Audit Report from Practicing CompanySecretary and therefore M/s RTBR& Associates Company Secretaries Ahmedabad had beenappointed to issue Secretarial Audit Report for the period ended on 31st March 2018.
Secretarial Audit Report issued by M/s RTBR & Associates Company Secretaries inForm MR-3 attached and marked as "Annexure B" for the period under reviewforms part of this report. The said report does not contain observation or qualification.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
In terms of section 135 and Schedule VII of the Companies Act 2013 the Board ofDirectors of your Company has constituted a CSR Committee. The Committee comprises of twoIndependent Directors one whole time director and one is executive director (Chairman& CFO).
In pursuant to provision of section 135 and Schedule VII of the Companies Act 2013and CSR policy of company it is required to spend two percent of average net profit of thecompany for the three immediately preceding financial year. However the company hasinadequate profit during the financial year 2017-18 and company is facing uphill task inmeeting its financial obligations. Hence the company is unable to spend any funds on CSRactivities for the time being. The company will incur the sum on CSR activities as soon asfinancial position of company will improve.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
Information required under section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 is given in the "Annexure-C" to thisreport.
In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished.
PARTICULARS OF CONTRACTS ORARRANGEMENTS MADE WITH RELATED PARTIES:
During the period under review the company had entered into any material transactionwith its related party. None of the transactions with any of the related party were inconflict of companies' interest. Attention of members is drawn to the disclosure oftransactions with related parties set out in note number 27 of financial statementsforming part of this report.
RETIREMENT BY ROTATION AND SUBSEQUENT RE-APPOINTMENT:
In accordance with the provisions of section 152 of the Act and in terms of Articlesof Association of the Company Mr. Kunal Tarachand Shah (DIN:00254205) and Ms. ShilpaMangaldas Patel (DIN: 07014883) being liable to retire by rotation shall retire at theensuing Annual General Meeting and being eligible offer themself for reappointment. TheBoard recommends their reappointment.
KEY MANAGERIAL PERSONNEL:
Mr. Kunal Tarachand Shah (DIN:00254205) is the existing Managing Director & ChiefExecutive officer of the Company. The Board of Directors subject to approval of theshareholders proposes his reappointment as a Managing Director & Chief Executiveofficer under Section 196 197 and 203 read with Schedule V and all other applicableprovisions of the Companies Act 2013 for a further period of five (5) years w.e.f. 28thSeptember 2017.
Ms. Shilpa Mangaldas Patel (DIN 07014883) is the existing whole time Director of theCompany. The Board of Directors subject to approval of the shareholders proposes hisre-appointment as a whole time Director under Section 196 197 and 203 read with ScheduleV and all other applicable provisions of the Companies Act 2013 for a further period offive (5) years w.e.f. 12th November 2017.
The Board of Directors in their meeting held on 26th April 2018 accepted theresignation of Mr. Vatan Brahmbhatt from the post of company secretary and complianceofficer of the Company and appointed Mr. Maunish s. Gandhi Associate Company Secretary asthe Company Secretary & Compliance Officer of the Company w.e.f 26th April 2018.
The brief resume of the Directors and other related information has been detailed inCorporate Governance Report of your Company.
EXTRACT OF ANNUAL RETURN :
The extracts of Annual Return inform MGT 9 pursuant to the provisions of Section 92read with Rule 12 of the Companies (Management and administration) Rules 2014 isfurnished in "Annexure D" and is attached to this Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIESACT 2013
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements for theyear ended on 31st March 2018.
REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and Companies(Particulars of Employees) Rules 1975 in respect of employees of the Company andDirectors is furnished hereunder:
|Name ||Designation ||Remuneration paid FY 2017-18 ||Remuneration paid FY 2016-17 ||Increase in remuneration from previous year |
| || ||Rs . in Lakh ||Rs . in Lakh ||Rs . in Lakh |
|Mr. AshokShah ||Chairman & CFO (ED) ||NIL ||NIL ||NIL |
|Mr. GunvantShah ||Vice Chairman & Whole time Director (ED) ||NIL ||NIL ||NIL |
|Mr. Kunal Shah ||Managing Director &CEO ||NIL ||NIL ||NIL |
|Ms. Shilpa Patel ||Whole time Director ||11.77 ||10.17 ||1.60 |
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY:
The Company has been addressing various risks impacting the Company and the policy ofthe Company on risk management is provided below:
|Foreign Exchange Risk ||Company exports all the products to various countries. Any volatility in the currency market can impact the overall profitability ||The Company commands excellent business relationship with the buyers. In case of major fluctuation either upwards or downwards the matter will be mutually discussed and compensated both ways. |
|Human Resource Risk ||Company's ability to deliver value is dependent on its ability to attract retain and nurture talent. Nonavailability of the required talent resource can affect the overall performance of the Company. ||By continuously benchmarking of the best HR practices across the industry and carrying out necessary improvements to attract and retain the best talent. By putting in place production incentives on time bound basis and evaluating the performance at each stage of work helps to mitigate this risk. |
|Competition Risk ||Company is always exposed to competition Risk from various Countries. The increase in competition can create pressure on margins market share etc. ||By continuous efforts to enhance the brand image of the Company by focusing on quality Cost timely delivery and customer service to mitigate the risks so involved. |
|Compliance Risk- Increasing regulatory requirements ||Any default can attract penal provisions. ||By regularly monitoring and review of changes in regulatory framework and by monitoring of compliance through legal compliance Management tools and regular internal audit. |
|Industrial Safety ||The industry is labour intensive and are exposed to accidents health and injury risk due to machinery breakdown human negligence etc. ||By development and implementation of critical safety standards across the various departments of the factory establishing training need identification at each level of employee helps to mitigate the risk so involved. |
Directors take this opportunity to express their thanks to various departments of theCentral and state Government Bankers Material Suppliers Customers and Shareholders fortheir continued support and guidance. The Directors wish to place on record theirappreciation for the dedicated efforts put in by the Employees of the Company at alllevels.
|Date: 26.04. 2018 ||By Order of the Board of Directors |
|Place: Ahmedabad ||SURAJ LIMITED |
|Registered Office: || |
|'Suraj House' Opp. Usmanpura Garden || |
|Ashram Road Ahmedabad-380014 ||ASHOK T. SHAH |
|CIN NO: L27100GJ1994PLC021088 ||Chairman cum Chief Financial Officer |
| ||(DIN : 00254255) |