UDAY JEWELLERY INDUSTRIES LIMITED
Your Directors have great pleasure in presenting their Twentieth Annual Report togetherwith the Audited Financial Statement of the Company for the financial year ended 31stMarch 2019.
1. FINANCIAL HIGHLIGHTS
The highlights of the financial statements of the Company for the financial year endedMarch 31 2019 are as under:
(Rs. in Lakhs except earnings per share)
|Particulars ||31.03.2019 ||31.03.2018 |
|Revenue from operations ||7341.29 ||7154.80 |
|Other Income ||26.09 ||27.53 |
|Total income ||7367.35 ||7182.32 |
|Profit before tax ||403.22 ||300.52 |
|Current Tax ||92.18 ||61.40 |
|Deferred Tax ||1.70 ||1.44 |
|Income tax pertaining to earlier years ||- ||(0.30) |
|Profit after Tax ||309.32 ||237.99 |
|Earnings per share || || |
|Basic ||1.72 ||1.66 |
|Diluted ||1.47 ||1.66 |
2. COMPANYS PERFORMANCE AND BUSINESS OVERVIEW:
During the year under review your Company has achieved a turnover of Rs. 7341.29 Lakhsagainst Rs. 7154.80 Lakhs during previous year registering a growth of 2.61% over theprevious year The Company reported a Net Profit after Tax of Rs. 309.32 Lakhs as againstRs. 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 stonestudded gold jewellery diamond studded jewellery and silver items and operates indifferent geographical areas i.e. domestic sales and export sales. Your Company iscontinuously moving ahead on its well defined growth path of:
Launching new designs and collections: During the year the Company launched severalnew jewellery designs and collections.
Strengthening in-house designing and manufacturing capabilities: The Company ishaving in-house designers team and sufficient manufacturing facilities for meetingits 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 underreview.
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 allotted2578890 new Equity shares of Rs. 10/- each at a premium of Rs. 8.98/- each to Promotersand Promoter Group upon conversion of warrants issued under Preferential Issue. Theproceeds from the said issue were utilized to meet the working capital requirements andenhancing manufacturing capacity of the business.
Further during the financial year 2018-19 there were no (i) Re-issue of forfeitedshares (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 yourdirectors 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 Companyhas not declared and paid dividend in previous year.
Amount to be carried forward to the reserves is Rs. 309.32/- Lakhs being Profit for theyear.
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 andCompliance officer of the Company on 22.04.2019.The Board places on record appreciationfor 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 beingobtained both at the time of appointment and at the First Board meeting of each FinancialYear.
In accordance with the provisions of Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mrs. Pritha Sanghi Director (DIN: 02681491) ofthe Company retires by rotation at the forthcoming Annual General Meeting and beingeligible offers herself for re-appointment. The Board recommends her re-appointment.
Shri Ramprasad Vempati (DIN: 01903161) Siddharth Goel (DIN: 03022978) Shri VikramGoel (DIN: 05104754) were appointed as Independent Directors on the Board of the Companypursuant to the provisions of Section 149 of the Act read with the Companies (Appointmentand Qualification of Directors) Rules 2014 and the erstwhile Clause 49 of the ListingAgreement with the stock exchange(s) on 29th September 2014. They hold office asIndependent Directors of the Company up to the conclusion of the ensuing Annual GeneralMeeting of the Company ("first term" in line with the explanation to Sections149(10) and 149(11) of the Act). The Nomination and Remuneration Committee of the Boardon the basis of performance evaluation of Independent Directors has recommendedre-appointment of Shri Ramprasad Vempati and Shri Vikram Goel as Independent Directorsfor a second term of 5 (five) consecutive years on the Board of the Company w.e.f. 28thSeptember 2019 .
Section 149(10) of the Act provides that an independent director shall hold office fora term of up to five consecutive years on the Board and shall be eligible forre-appointment on passing a Special Resolution by the Company and disclosure ofsuch appointment in its Boards report. Section 149(11) provides that an independentdirector may hold office for up to two consecutive terms.
Further Mr. Praveen Kumar Agarwal (DIN: 02012257) has been appointed as AdditionalDirector. It is proposed to appoint Mr. Praveen Kumar Agarwal as Independent Director ofthe Company to hold office for a term of 5 (Five) consecutive years in line with theprovisions of Sections 149(10) and 149(11) of the Act. He meets the criteria ofindependent director as specified under Section 149(6) of the Act.
Mr. Uday Sanghi (DIN: 08533271) has been appointed as an Additional Director of theCompany with effect from 13th August 2019 by the Board of Directors. In terms of Section161(1) of the Companies Act 2013 Mr. Uday Sanghi holds office upto the date of thisAnnual General Meeting but is eligible for the appointment as a Director. The Company hasreceived a Notice from a member in writing under Section 160 of the Act proposing hiscandidature for the office of Director. The Board recommends his appointment as Directorof the Company
10. STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS:
Your Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the Act read with theapplicable Schedules and Rules as well as the SEBI (Listing Obligations and DisclosureRequirements) 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 18.10.201814.11.2018 30.11.2018 and 14.02.2019. For further details please refer to Report onCorporate Governance.
12. BOARD EVALUATION:
The Board of your Company on the recommendation of Nomination and RemunerationCommittee had laid down the criteria for evaluation of performance of the Board itsCommittees and individual Directors. Accordingly annual performance evaluation processwas carried out based on evaluation forms which include a rating mechanism. IndependentDirectors also reviewed the performance of the Board as a whole Non Independent Directorsand the Chairman.
The criteria for performance evaluation of the Board and its Committees amongst othersincludes their structure and composition processes information and functioning terms ofreference of the Committees etc. The criteria for performance evaluation of individualDirectors including Executive and Independent Directors amongst others includes theirattendance and contribution at the meetings devotion of time and efforts to understandthe Company its business their duties and responsibilities and adherence to the code ofconduct etc. The said policy is available at the website of the Company atwww.udayjewellery.com The Independent Directors had met separately on 21st January 2019without the presence of Non-Independent Directors to discuss the performance of theNon-Independent Directors and the Board as a whole.
13. POLICY ON DIRECTORS APPOINTMENT & REMUNERATION AND CRITERIA FORDETERMINING 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 thepersons for appointment as Director Key Managerial Personnel and other Senior ManagementPersonnel and to attract motivate improve productivity and retain manpower by creating acongenial work atmosphere encouraging initiatives and team work by creating a sense ofbelonging and involvement besides offering appropriate remuneration packages.
The objective of the Policy on Criteria for determining Qualifications PositiveAttributes and Independence of a Director is to determine qualifications positiveattributes and independence of a director.
The Nomination & Remuneration Policy as well as Criteria for determiningQualifications Positive Attributes and Independence of a Director are placed on theCompanys website www.udayjewellery.com in the Investor Section.
14. BOARD COMMITTEES :
Detailed composition of the Board committees namely Audit Committee Nomination andRemuneration Committee and Corporate Stakeholders Relationship Committee number ofmeetings held during the year under review and other related details are set out in theCorporate 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 theCorporate Governance Report which is a part of this report. All the recommendations madeby 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 Reportforms part of the Annual Report.
17. RISK MANAGEMENT:
Your Company has put in place a Risk Management Policy to define a framework foridentification assessment and mitigation of risk. In the opinion of the Board there areno 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 theassets of the Company are safeguarded and protected against any loss from unauthorized useor disposition. The Company has appointed M/s Krishna and Suresh Chartered AccountantHyderabad (Firm Regn No- 001461S) as its Internal Auditors who independently evaluate theadequacy of internal controls audit the majority of the transactions in value terms andreview the operational efficiency effectiveness of systems and processes. The internalaudit reports and related party transactions are periodically reviewed by Audit Committee.Your Company has also put in place adequate internal financial controls with reference tothe financial statements commensurate with the size and nature of operations of theCompany. During the year such controls were tested and no material discrepancy orweakness in the Companys internal controls over financial reporting was observed.
19. MANAGERIAL REMUNERATION
The Companys policy on Directors appointment and remuneration in accordancewith Section 178 (3) of the Companies Act 2013 the same is available at the website ofthe Company at www.udayjewellery.com. No remuneration is being paid to the ManagingDirector or any other Director of the Company. The information required pursuant toSection 197 read with rule 5 of the Companies (Appointment and Remuneration) Rules 2014and Companies (Particulars of Employees) Rules 1975 in respect of employees of theCompany and Directors is furnished hereunder: i) Details of percentage increase in theremuneration of each Director and CFO and Company Secretary in the Financial Year 2018-19are as follows:
|Name ||Designation ||Remuneration (in Rs.) ||Increase |
| || ||2018-19 ||2017-18 ||% |
|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 2019are 26.
20. PARTICULARS OF EMPLOYEES:
In terms of the provisions of Section 197 of the Companies Act 2013 read with rule 5of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of disclosures in the report w.r.t. employees of the Company will be providedupon request. However as per the provisions of Section 136 of the said Act the AnnualReport excluding the aforesaid information is being sent to all the members of the Companyand others entitled thereto. Any member interested in obtaining the information onemployees particulars which is available for inspection by the members at theRegistered office of the Company during business hours on working days of the Company upto the date of ensuing Annual General Meeting may write to the Company at the registeredoffice of the Company in advance.
During the year under report none of the employees was in receipt of remunerationexceeding the limit prescribed under Section 197(12) of the Companies Act 2013 and Rule 5of 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 Companycontinuously invests in attraction retention and development of talent on an ongoingbasis. A number of programs that provide focused people attention are currently underway.Your Companys thrust is on the promotion of talent internally through job rotationand job enlargement.
22. INSIDER TRADING REGULATIONS:
Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations2015 as amended from time to time the code of conduct for prohibition of insidertrading as approved and adopted by the Directors and designated Employees of the Company.The Code requires pre-clearance for dealing in the Companys shares and prohibits thepurchase or sale of Company shares by the Directors and designated employees while inpossession of unpublished price sensitive information during the period of Trading WindowClosure. The Board is responsible for implementation of the Code. All Board of Directorsand designated employees have confirmed compliance with the Code. The Board has appointedMr. 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 onthe date of this report.
24. STATUTORY AUDITORS:
The Board on the recommendation of Audit Committee has approved the re- appointmentof 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 the22nd Annual General Meeting of the Company to be held in the calendar year 2021. They haveaudited the financial statements of the Company for the financial year under review. Theobservations of Statutory Auditors in their Report read with relevant Notes to Accountsare self-explanatory and therefore do not require further explanation. The AuditorsReport does not contain any qualification reservation or adverse remark. Further therewere no frauds reported by the Statutory Auditors to the Audit Committee or the Boardunder Section 143(12) of the Act.
25. SECRETARIAL AUDITOR:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and rules madethere under Shri Ajay S. Shrivastava Practicing Company Secretary Hyderabad (COP No.-3479) had been appointed as Secretarial Auditor of the Company for the financial year2018-19.The Secretarial Audit report does not contain any qualification reservations oradverse remark. The report of the Secretarial Auditors in the prescribed Form MR-3 isenclosed 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 ofthe Act.
27. WHISTLE BLOWER POLICY / VIGIL MECHANISM:
Pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013 readwith Rule 7 of Companies (Meetings of Board and its Powers) Rules 2014and Regulation 22of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has in place a Whistle Blower Policy whichprovides for a vigil mechanism that encourages and supports its Directors and employees toreport instances of illegal activities unethical behaviour actual or suspected fraud orviolation of the Companys Code of Conduct. It also provides for adequate safeguardsagainst victimization of persons who use this mechanism. The said policy is updated on thewebsite 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 Rule12 of the Companies (Management and Administration) Rules 2014 is available inCompanys 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 theCompany 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 provideunsecured loan to an extent of Rs. 3.14 Crores under Section 186 of the Companies Act2013. Out of which the Company provide Rs. 250 Lakhs to Trisa Retail Limited. As on theend of period under review the outstanding amount of such unsecured loan is Rs. 272.42Lakhs (including Interest). Further the Company has not given any guarantee or providedany security in connection with any loan to any other body corporate in accordance withSection 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 withrelated parties referred to in sub-section (1) of section 188 of the Companies Act 2013and Listing Obligation Disclosure Regulation (LODR) 2015 during the financial year endedMarch 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 andadhere to the requirements set out by the Securities and Exchange Board of India. TheReport on Corporate Governance as stipulated under the LODR Regulations forms part of theAnnual Report. The certificate from the Practicing Company Secretary confirming complianceof 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 AnnexureIV 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 ofenergy avoid wastages and conserve energy as far as possible.
B. TECHNOLOGY ABSORPTION
The Company has not carried out any research and development activities. Hence theinformation 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 ofthe 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 Statementfor the financial year ended 31st March 2019 are in full conformity with the requirementof the Act and they believe that the financial statements reflect fairly the form andsubstance of transactions carried out during the year and reasonably present theCompanys financial condition and results of operations. These Financial Statementsare audited by M/s Venugopal & Chenoy Chartered Accountants Statutory Auditors ofthe Company.
Pursuant to the requirement of Section 134(5) of the Companies Act 2013 yourDirectors further confirm that:
i) In the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed along with proper explanations relating to material departures;
ii) The Directors have 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 profit and Loss of the Company for that period;
iii) The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
iv) The Directors have prepared the annual accounts on a going concern basis.
v) The directors in case of listed company have laid down internal financial controlsto be followed by the company and such controls are adequate and are operatingeffectively.
vi) The Directors have devised proper system to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and are operating effectively.
Your Companys equity shares are listed on BSE limited. The Company has dulycomplied with all the applicable provisions of the SEBI (Listing Obligations andDisclosure 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 provisionsof Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 and the rules framed there under. The Company has constituted an Internal ComplaintsCommittee headed by Smt. Pritha Sanghi Director for redressal of complaints on sexualharassment. During the year the Company had not received any complaint on sexualharassment 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 ortribunals 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 appreciationfor the valuable support and cooperation of the Companys employees bankersgovernment and other statutory authorities customers suppliers and shareholders whohave 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 |
|Sd/- ||Sd/- |
|(Ritesh Kumar Sanghi) ||(Sanjay Kumar Sanghi) |
|Managing Director ||Director |
|DIN: 00628033 ||DIN: 00629693 |
|ANNEXURE ||CONTENTS |
|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 |