UDAY JEWELLERY INDUSTRIES LIMITED
Your Directors have great pleasure in presenting their Twentieth Annual Report together with the Audited Financial Statement of the Company for the financial year ended 31st March 2019.
1. FINANCIAL HIGHLIGHTS
The highlights of the financial statements of the Company for the financial year ended March 31 2019 are as under:
(Rs. in Lakhs except earnings per share)
|Revenue from operations||7341.29||7154.80|
|Profit before tax||403.22||300.52|
|Income tax pertaining to earlier years||-||(0.30)|
|Profit after Tax||309.32||237.99|
|Earnings per share|
2. COMPANY'S PERFORMANCE AND BUSINESS OVERVIEW:
During the year under review your Company has achieved a turnover of Rs. 7341.29 Lakhs against Rs. 7154.80 Lakhs during previous year registering a growth of 2.61% over the previous year The Company reported a Net Profit after Tax of Rs. 309.32 Lakhs as against Rs. 237.99 Lakhs earned during previous year registering a growth over 29.98%.
Your Company is engaged in the business of manufacturing sale and trading of stone studded gold jewellery diamond studded jewellery and silver items and operates in different geographical areas i.e. domestic sales and export sales. Your Company is continuously moving ahead on its well defined growth path of:
Launching new designs and collections: During the year the Company launched several new jewellery designs and collections.
Strengthening in-house designing and manufacturing capabilities: The Company is having in-house designers' team and sufficient manufacturing facilities for meeting its requirements.
3. CHANGE IN THE NATURE OF BUSINESS IF ANY:
There was no change in the nature of business of the Company during the year under review.
4. SHARE CAPITAL
The Issued Subscribed and Paid up Equity Share Capital of the Company is Rs. 194430100/ - (Rupees Nineteen Crores Forty Four Lakhs Thirty Thousand One Hundred only) divided into 19443010 (One Crore Ninety Four Lakhs Forty Three Thousand Ten only) Equity shares of Rs. 10/- each. During the year under review the Company has allotted 2578890 new Equity shares of Rs. 10/- each at a premium of Rs. 8.98/- each to Promoters and Promoter Group upon conversion of warrants issued under Preferential Issue. The proceeds from the said issue were utilized to meet the working capital requirements and enhancing manufacturing capacity of the business.
Further during the financial year 2018-19 there were no (i) Re-issue of forfeited shares (ii) Issue of shares with differential rights (iii) Issue of sweat equity shares (iv) Issue of ESOP
In order to conserve resources for further expanding business of the Company your directors have opined not to recommend any dividend for the year under review.
6. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:
The provisions of Section 125(2) of the Companies Act 2013 do not apply as the Company has not declared and paid dividend in previous year.
Amount to be carried forward to the reserves is Rs. 309.32/- Lakhs being Profit for the year.
8. KEY MANAGERIAL PERSONNEL:
|1.||Mr. Ritesh Kumar Sanghi||- Managing Director|
|2.||Mr. Rakesh Agarwal||- Chief Financial officer|
|3.||Mr. Sher Singh Verma||- Company Secretary|
CS Priyanka Agarwal (A36112) has resigned from the position of Company Secretary and Compliance officer of the Company on 22.04.2019.The Board places on record appreciation for the services and contribution made by her during her tenure. Mr. Sher Singh Verma (A58060) has been appointed as Company Secretary and Compliance Officer w.e.f. 22.04.2019.
9. DIRECTORS :
As at 31.03.2019 the Board consist of Six Directors including Three Independent (Non- Executive Directors). The declaration from all the Independent Directors are being obtained both at the time of appointment and at the First Board meeting of each Financial Year.
In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the Company Mrs. Pritha Sanghi Director (DIN: 02681491) of the Company retires by rotation at the forthcoming Annual General Meeting and being eligible offers herself for re-appointment. The Board recommends her re-appointment.
Shri Ramprasad Vempati (DIN: 01903161) Siddharth Goel (DIN: 03022978) Shri Vikram Goel (DIN: 05104754) were appointed as Independent Directors on the Board of the Company pursuant to the provisions of Section 149 of the Act read with the Companies (Appointment and Qualification of Directors) Rules 2014 and the erstwhile Clause 49 of the Listing Agreement with the stock exchange(s) on 29th September 2014. They hold office as Independent Directors of the Company up to the conclusion of the ensuing Annual General Meeting of the Company (first term in line with the explanation to Sections 149(10) and 149(11) of the Act). The Nomination and Remuneration Committee of the Board on the basis of performance evaluation of Independent Directors has recommended re-appointment of Shri Ramprasad Vempati and Shri Vikram Goel as Independent Directors for a second term of 5 (five) consecutive years on the Board of the Company w.e.f. 28th September 2019 .
Section 149(10) of the Act provides that an independent director shall hold office for a term of up to five consecutive years on the Board and shall be eligible for re-appointment on passing a Special Resolution by the Company and disclosure of such appointment in its Board's report. Section 149(11) provides that an independent director may hold office for up to two consecutive terms.
Further Mr. Praveen Kumar Agarwal (DIN: 02012257) has been appointed as Additional Director. It is proposed to appoint Mr. Praveen Kumar Agarwal as Independent Director of the Company to hold office for a term of 5 (Five) consecutive years in line with the provisions of Sections 149(10) and 149(11) of the Act. He meets the criteria of independent director as specified under Section 149(6) of the Act.
Mr. Uday Sanghi (DIN: 08533271) has been appointed as an Additional Director of the Company with effect from 13th August 2019 by the Board of Directors. In terms of Section 161(1) of the Companies Act 2013 Mr. Uday Sanghi holds office upto the date of this Annual General Meeting but is eligible for the appointment as a Director. The Company has received a Notice from a member in writing under Section 160 of the Act proposing his candidature for the office of Director. The Board recommends his appointment as Director of the Company
10. STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS:
Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the Act read with the applicable Schedules and Rules as well as the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (LODR Regulations).
11. NUMBER OF MEETINGS OF THE BOARD
During the year Six Board meetings were held on 30.05.2018 14.08.2018 18.10.2018 14.11.2018 30.11.2018 and 14.02.2019. For further details please refer to Report on Corporate Governance.
12. BOARD EVALUATION:
The Board of your Company on the recommendation of Nomination and Remuneration Committee had laid down the criteria for evaluation of performance of the Board its Committees and individual Directors. Accordingly annual performance evaluation process was carried out based on evaluation forms which include a rating mechanism. Independent Directors also reviewed the performance of the Board as a whole Non Independent Directors and the Chairman.
The criteria for performance evaluation of the Board and its Committees amongst others includes their structure and composition processes information and functioning terms of reference of the Committees etc. The criteria for performance evaluation of individual Directors including Executive and Independent Directors amongst others includes their attendance and contribution at the meetings devotion of time and efforts to understand the Company its business their duties and responsibilities and adherence to the code of conduct etc. The said policy is available at the website of the Company at www.udayjewellery.com The Independent Directors had met separately on 21st January 2019 without the presence of Non-Independent Directors to discuss the performance of the Non-Independent Directors and the Board as a whole.
13. POLICY ON DIRECTORS' APPOINTMENT & REMUNERATION AND CRITERIA FOR DETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES & INDEPENDENCE OF A DIRECTOR:
Your Company has always considered human resources as invaluable assets of the Company. The Nomination & Remuneration Policy of the Company is designed to identify the persons for appointment as Director Key Managerial Personnel and other Senior Management Personnel and to attract motivate improve productivity and retain manpower by creating a congenial work atmosphere encouraging initiatives and team work by creating a sense of belonging and involvement besides offering appropriate remuneration packages.
The objective of the Policy on Criteria for determining Qualifications Positive Attributes and Independence of a Director is to determine qualifications positive attributes and independence of a director.
The Nomination & Remuneration Policy as well as Criteria for determining Qualifications Positive Attributes and Independence of a Director are placed on the Company's website www.udayjewellery.com in the Investor Section.
14. BOARD COMMITTEES :
Detailed composition of the Board committees namely Audit Committee Nomination and Remuneration Committee and Corporate Stakeholders Relationship Committee number of meetings held during the year under review and other related details are set out in the Corporate Governance Report which forms a part of this Report.
15. AUDIT COMMITTEE:
The details pertaining to the composition of the audit committee are included in the Corporate Governance Report which is a part of this report. All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company
16. MANAGEMENT DISCUSSION AND ANALYSIS:
As stipulated under the LODR Regulations the Management Discussion and Analysis Report forms part of the Annual Report.
17. RISK MANAGEMENT:
Your Company has put in place a Risk Management Policy to define a framework for identification assessment and mitigation of risk. In the opinion of the Board there are no risks which may threaten the existence of the Company.
18. INTERNAL CONTROL SYSTEMS:
Your Company has an effective internal control system which ensures that all the assets of the Company are safeguarded and protected against any loss from unauthorized use or disposition. The Company has appointed M/s Krishna and Suresh Chartered Accountant Hyderabad (Firm Regn No- 001461S) as its Internal Auditors who independently evaluate the adequacy of internal controls audit the majority of the transactions in value terms and review the operational efficiency effectiveness of systems and processes. The internal audit reports and related party transactions are periodically reviewed by Audit Committee. Your Company has also put in place adequate internal financial controls with reference to the financial statements commensurate with the size and nature of operations of the Company. During the year such controls were tested and no material discrepancy or weakness in the Company's internal controls over financial reporting was observed.
19. MANAGERIAL REMUNERATION
The Company's policy on Director's appointment and remuneration in accordance with Section 178 (3) of the Companies Act 2013 the same is available at the website of the Company at www.udayjewellery.com. No remuneration is being paid to the Managing Director or any other Director of the Company. The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration) Rules 2014 and Companies (Particulars of Employees) Rules 1975 in respect of employees of the Company and Directors is furnished hereunder:
i) Details of percentage increase in the remuneration of each Director and CFO and Company Secretary in the Financial Year 2018-19 are as follows:
|Name||Designation||Remuneration (in Rs.)||Increase|
|Ritesh Kumar Sanghi||Managing Director||-||-||-|
|Sanjay Kumar Sanghi||Director||-||-||-|
|Rakesh Agarwal||Chief Financial Officer||600000||600000||-|
|Priyanka Agarwal||Company Secretary||105000*||-||-|
*For part of the current year only
ii) Numbers of permanent employees on the rolls of the Company as on 31st March 2019 are 26.
20. PARTICULARS OF EMPLOYEES:
In terms of the provisions of Section 197 of the Companies Act 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of disclosures in the report w.r.t. employees of the Company will be provided upon request. However as per the provisions of Section 136 of the said Act the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining the information on employee's particulars which is available for inspection by the members at the Registered office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting may write to the Company at the registered office of the Company in advance.
During the year under report none of the employees was in receipt of remuneration exceeding the limit prescribed under Section 197(12) of the Companies Act 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
21. HUMAN RESOURCES:
Your Company treats its manpower as one of its most important assets. Your Company continuously invests in attraction retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company's thrust is on the promotion of talent internally through job rotation and job enlargement.
22. INSIDER TRADING REGULATIONS:
Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations 2015 as amended from time to time the code of conduct for prohibition of insider trading as approved and adopted by the Directors and designated Employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and designated employees while in possession of unpublished price sensitive information during the period of Trading Window Closure. The Board is responsible for implementation of the Code. All Board of Directors and designated employees have confirmed compliance with the Code. The Board has appointed Mr. Sher Singh Verma Compliance officer under the code.
23. DETAILS OF SUBSIDIARY/JOINT VENTURES/ASSOCIATE COMPANIES:
There are no subsidiaries or associate companies or joint ventures to the Company as on the date of this report.
24. STATUTORY AUDITORS:
The Board on the recommendation of Audit Committee has approved the re- appointment of M/s Venugopal & Chenoy Chartered Accountants Hyderabad (Firm Regn. No.- 004671S) as the Statutory Auditors of the Company who have hold the position for 8 (Eight) consecutive years and can be re-appointed for 2 (Two) years till the conclusion of the 22nd Annual General Meeting of the Company to be held in the calendar year 2021. They have audited the financial statements of the Company for the financial year under review. The observations of Statutory Auditors in their Report read with relevant Notes to Accounts are self-explanatory and therefore do not require further explanation. The Auditors' Report does not contain any qualification reservation or adverse remark. Further there were no frauds reported by the Statutory Auditors to the Audit Committee or the Board under Section 143(12) of the Act.
25. SECRETARIAL AUDITOR:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules made there under Shri Ajay S. Shrivastava Practicing Company Secretary Hyderabad (COP No.- 3479) had been appointed as Secretarial Auditor of the Company for the financial year 2018-19.The Secretarial Audit report does not contain any qualification reservations or adverse remark. The report of the Secretarial Auditors in the prescribed Form MR-3 is enclosed as Annexure I to this report.
The Annual Secretarial Compliance report as per Regulation 24A of SEBI (LODR) Regulation 2015 as amended is enclosed as Annexure II to this report.
26. COST RECORDS:
Your Company is not required to maintain cost records as specified under Section 148 of the Act.
27. WHISTLE BLOWER POLICY / VIGIL MECHANISM:
Pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules 2014and Regulation 22 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 the Company has in place a Whistle Blower Policy which provides for a vigil mechanism that encourages and supports its Directors and employees to report instances of illegal activities unethical behaviour actual or suspected fraud or violation of the Company's Code of Conduct. It also provides for adequate safeguards against victimization of persons who use this mechanism. The said policy is updated on the website of the Company at www.udayjewellery.com.
28. EXTRACTS OF ANNUAL RETURN:
The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules 2014 is available in Company's website at www.udayjewellery.com
29. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF THE FINANCIAL YEAR AND DATE OF REPORT:
There have been no material changes and commitments affecting financial position of the Company between end of the financial year and the date of the report.
30. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has entered into an agreement with Trisa Retail Limited to provide unsecured loan to an extent of Rs. 3.14 Crores under Section 186 of the Companies Act 2013. Out of which the Company provide Rs. 250 Lakhs to Trisa Retail Limited. As on the end of period under review the outstanding amount of such unsecured loan is Rs. 272.42 Lakhs (including Interest). Further the Company has not given any guarantee or provided any security in connection with any loan to any other body corporate in accordance with Section 186 of the Companies Act 2013.
31. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act 2013 and Listing Obligation Disclosure Regulation (LODR) 2015 during the financial year ended March 31 2019 is disclosed in Form No. AOC-2 as Annexure III to this report.
32. CORPORATE GOVERNANCE CERTIFICATE:
Your Company is committed to maintain the high standards of corporate governance and adhere to the requirements set out by the Securities and Exchange Board of India. The Report on Corporate Governance as stipulated under the LODR Regulations forms part of the Annual Report. The certificate from the Practicing Company Secretary confirming compliance of conditions of Corporate Governance as stipulated under Part E of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexed as Annexure IV to this report.
33. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
A. CONSERVATION OF ENERGY
In its endeavour towards conservation of energy your Company ensures optimal use of energy avoid wastages and conserve energy as far as possible.
B. TECHNOLOGY ABSORPTION
The Company has not carried out any research and development activities. Hence the information relating to technology absorption is NIL.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
During the year under review the foreign exchange earnings of the Company is Rs. 285.24 Lacs only.
34. CORPORATE SOCIAL RESPONSIBILITY (CSR):
During the year under review the Company did not attract the criteria of Corporate Social Responsibility pursuant to the provisions of Section 135 of the Companies Act 2013 read with the Companies (Corporate Social Responsibility Policy) Rules 2014.
35. DIRECTORS' RESPONSIBILITY STATEMENT:
Your Directors would like to inform the members that the audited Financial Statement for the financial year ended 31st March 2019 are in full conformity with the requirement of the Act and they believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Company's financial condition and results of operations. These Financial Statements are audited by M/s Venugopal & Chenoy Chartered Accountants Statutory Auditors of the Company.
Pursuant to the requirement of Section 134(5) of the Companies Act 2013 your Directors further confirm that:
i) In the preparation of the Annual Accounts the applicable Accounting Standards have been followed along with proper explanations relating to material departures;
ii) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and Loss of the Company for that period;
iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) The Directors have prepared the annual accounts on a going concern basis.
v) The directors in case of listed company have laid down internal financial controls to be followed by the company and such controls are adequate and are operating effectively.
vi) The Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.
Your Company's equity shares are listed on BSE limited. The Company has duly complied with all the applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and the amendments therein.
37. DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013:
Your Company has adopted a policy against sexual harassment in line with the provisions of Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framed there under. The Company has constituted an Internal Complaints Committee headed by Smt. Pritha Sanghi Director for redressal of complaints on sexual harassment. During the year the Company had not received any complaint on sexual harassment and no complaint was pending as on 31st March 2019.
38. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR
COURTS OR TRIBUNAL:
There were no significant / material orders passed by the regulators or courts or tribunals impacting the going concern status of your Company and its operations in future.
Your Directors wish to convey their gratitude and place on record their appreciation for the valuable support and cooperation of the Company's employees bankers government and other statutory authorities customers suppliers and shareholders who have reposed their continued trust and confidence in the Company
Place: Plot No 5-9-60 Flat No 301 Moghuls Court
Basheerbagh Hyderabad - 500 001
|On behalf of Board of Directors |
|(Ritesh Kumar Sanghi)||(Sanjay Kumar Sanghi)|
|DIN: 00628033||DIN: 00629693|
|I||Secretarial Audit Report- Form MR-3|
|II||Annual Secretarial Compliance report|
|III||Particulars of Contract with related parties- Form AOC-2|
|IV||Compliance Certificate for Corporate Governance|