To All members
Your Directors have pleasure in presenting the 31st Annual Report on the business andoperations of your company along with the Audited Statement of Accounts for the year ended31st March 2019.
FINANCIAL RESULTS & STATE OF AFFAIRS
The highlights of the financial results of the company for the year ended 31st March2019 as compared with the previous year are given below:
( Rs in lakhs except EPS data)
|Particulars ||31.03.2019 ||31.03.2018 |
|Revenue from operation ||15515.30 ||9480.71 |
|Other income ||968.96 ||246.25 |
|Total Income ||16484.26 ||9726.96 |
|Profit before Interest & Depreciation ||1821.54 ||551.72 |
|Profit / (Loss) before Taxation ||1269.52 ||360.76 |
|Profit/(Loss) after Taxation ||893.38 ||283.82 |
|EPS ||0.73 ||0.42 |
Total income increased to RS 16484.26 Lakhs as against RS 9726.96 Lakhs in the previousyear showing a growth of 69.47%. The Profit before Tax for the current year is RS 1269.52Lakhs as against RS 360.76 Lakhs in the previous year showing a growth of 251.90%. TheProfit after Tax (PAT) for the current year is RS 893.38 Lakhs as against the PAT of283.82 Lakhs in the previous year. The growth in PAT of current financial year is mainlydriven by increase in net revenue from sales of prime products.
There are no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year 2018-19 and the date ofthis Report.
SUBSIDIARIES & ASSOCIATES
The Company does not have any Subsidiary & Associate concerns during the year.
CHANGE(S) IN THE NATURE OF BUSINESS
There has been no change in the nature of business of the Company.
Keeping in view to further improve the capacity utilization and consolidate itsexisting facilities the Board has considered prudent to conserve and retain the profitfor further improvement. The Board regrets its inability to recommend any dividend.
TRANSFER TO RESERVE
During the year under review no profit has been transferred to General Reserve.
During the period under review the Company did not invite or accept any deposits fromthe public in terms of Chapter V of the Companies Act 2013
DIRECTOR'S RESPONSIBILITY STATEMENT
In compliance with section 134(3) (c) of the Companies Act 2013 your Directorsconfirm: a. That in the preparation of Annual Accounts the applicable accountingstandards have been followed and that no material departures have been made from the same.b. That 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 profitor loss of the Company for that period. c. That they have taken proper and sufficient carefor the maintenance of adequate accounting records in accordance with the provisions ofthe Companies Act2013 for safeguarding the assets of your company and for preventing anddetecting fraud and other irregularities; d. That they have prepared the annual accountson a going concern basis. e. That proper internal financial controls were in place andthat the financial controls were adequate and were operating effectively f. That systemsto ensure compliance with the provisions of all applicable laws were in place and wereadequate and operating effectively
The authorized Share Capital and paid up Share Capital as on 31.03.2019 is RS300000000/- (150000000 Equity shares of RS 2/-each) and RS 244685700/-(122342850 Equity shares of RS 2/- each respectively.
DIRECTORS KMP & CHANGES THEREIN
Based on the confirmations received from Directors none of the Directors aredisqualified from appointment under Section 164 of the Companies Act 2013. There is nochange in Directors & KMP during the period under review. However Mr. SrinivasanSethuraman has resigned from the position of Managing Director as well as from the Boardof the Company on14th August 2019. Further Mr. Nazeer Azam Sulthan (DIN: 08072833)appointed as an Additional Director (Non-Executive) on the Board of the Company w.e.f 14thAugust 2019 and he will be designated as the Managing Director of the Company w.e.f 15thSeptember 2019.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration under section 149(7) of the CompaniesAct 2013 that he/she meets the criteria of independence laid down in section 149(6) ofthe Companies Act 2013 and Regulation 25 of SEBI (LODR) Regulations 2015.
Pursuant to the provisions of the Companies Act 2013 and SEBI (LODR) 2015 the Boardhas carried out an annual performance evaluation of its own performance the directorsindividually as well as the evaluation of the working of its Audit Nomination &Remuneration and other Committees. The manner in which the evaluation has been carried outhas been explained in the Corporate Governance Report.
NOMINATION & REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The brief terms of reference of Nomination & Remuneration Committee isstated in corporate governance report. The link to access Nomination & RemunerationPolicy is https://www.uniplydecor.com/docs/policy/NOMINATION%20&%20REMUNERATION%20 POLICY.pdf.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
The Company has framed Familiarization Programme for Independent Directors pursuant toSEBI (LODR) 2015 and uploaded the same in the website of the Company. The web link toaccess the aforesaid programme is w w w.uniplydecor.com/docs/policy/UDL-FAMILARISATION%20 PROGRAMME%20FOR%20INDEPEDENT%20DIRECTORS.pdf.
A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year under review 4 (Four) Board Meetings were convened and held. The details ofwhich are given in the Corporate Governance Report. The intervening gaps between theMeetings were within the period prescribed under the Companies Act 2013.
MEETING OF THE COMMITTEE
The Board has various Committees such as Audit Committee Nomination and RemunerationCommittee and Stakeholders' Relationship Committee. The details of each committee andtheir respective meetings have been provided in the Corporate Governance Report.
MEETINGS OF INDEPENDENT DIRECTORS
In terms of Schedule IV of the Companies Act 2013 and the SEBI (LODR) 2015 a separatemeeting of the Independent Directors of the Company was held on 14.02.2019 without thepresence of Executive Directors and members of the management wherein they inter aliadiscussed: The performance of the Chairperson of the Company taking into accountthe views of Executive Directors and Non-Executive Directors; and The performanceof Non-Independent Directors and the Board as a whole;
The quality quantity and timeliness of flow of information between the Companymanagement and the Board that is necessary for the Board to effectively and reasonablyperform their duties.
COST AUDIT / MAINTENANCE OF COST RECORDS
The Company was not falling under criteria given for maintenance of Cost Record/CostAudit as per the Companies (Cost Records and Audit) Rules 2014. Hence costaudit/Maintenance of cost record was not conducted.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of (Managerial Personnel) Rules 2014 the Company hasappointed M/s. Lakshmi Subramanian & Associates Practicing Company SecretariesChennai to undertake the Secretarial Audit of the Company. The Report of the SecretarialAuditor in MGT-3 is annexed herewith as "Annexure A". The Report does notcontain any qualification reservation or adverse remark.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is annexedherewith as "Annexure B".
MATERIAL CHANGES & COMMITMENTS
After the end of the financial year the following material events have occurred: a. TheBoard has approved the shifting of the Registered Office of the Company from ChennaiTamil Nadu to New Delhi subject to the approval of the Shareholders and other RegulatoryAuthority (ies) as per the applicable law. b. The Company has completed upgradation andfull automation of its manufacturing facility at Bachau Gujarat. With the saidupgradation the plant will run at labour efficiency of over 40% on the enhanced capacity.The Board approved the transfer of all production from the Company's legacy Chennai plantto the newly automated facility at Gujarat. c. Mr. Srinivasan Sethuraman has resigned fromthe position of Managing Director & as well as from the Board of the Directors of theCompany w.e.f 14th August 2019. d. Mr. Nazeer Azam Sulthan (DIN: 08072833) appointed asan Additional Director (Non-Executive) on the Board of the Company w.e.f 14th August 2019and he will be designated as the Managing Director of the Company w.e.f 15th September2019. e. M/s. Lily & Geetha Associates Chartered Accountants Chennai resigned fromthe Office of the Statutory Auditors w.e.f. 14th August 2019 and to fill such casualvacancy in the office of the statutory Auditor the Board has appointed M/s. N D Kapur& Co. Chartered Accountants New Delhi as the Statutory Auditors of the Companytheir appointment is subject to the approval of the Shareholders in their ensuing GeneralMeeting and in compliance with the applicable laws.
Except this there were no other changes.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business. There are materiallysignificant related party transactions made by the Company with Promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large. The details have been furnished in Form AOC-2. Thepolicy on Related Party Transactions as approved by the Board is uploaded on the Company'swebsite. The Web link for the same is https://www.uniplydecor.com/docs/policy/UDL-RELATED%20 ARTY%20TRANSACTION%205%20POLICY.pdf. The detail with respect toRelated Party Transactions is slated in form AOC-2 in Annexure C
PARTICULARS OF EMPLOYEES
Particulars of employees as per section 197 of the Companies Act 2013 read with rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 need to be furnished is NIL. The Information which are required to bedisclosed on Annual Report under section 197(12) of the Companies Act 2013 read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is stated in Annexure-D.
STATUTORY AUDITORS & THEIR REPORT
In accordance with the provisions of Section 139 of the Companies Act 2013 and theRules made there under M/s. Lily & Geetha Associates Chartered Accountants Chennaihaving FRN.: 006982S was appointed as the Statutory Auditors of the Company at the 29thAnnual General Meeting held on 27th September 2017 for a term of five years till theconclusion of 33rd Annual General Meeting. However M/s. Lily & Geetha AssociatesChartered Accountants Chennai has tender their resignation as the Statutory Auditors ofthe Company expressing their inability due to constraint of manpower for the Auditresulting in a casual vacancy in the office of the Auditors of the Company w.e.f. 14thAugust 2019 as per section 139(8) of the Companies Act 2013.
In accordance with aforesaid provisions of the Act the Board has recommended to themembers for the appointment of M/s. N D Kapur & Co. Chartered Accountants New Delhias the Statutory Auditors of the Company: a) to fill the casual vacancy caused by theresignation of M/s. Lily & Geetha Associates Chartered Accountants Chennai and tohold the office of the Statutory Auditors upto the conclusion of this Annual GeneralMeeting: and b) for a period of five years from the conclusion of the 31st Annual GeneralMeeting till the conclusion of 36th Annual General Meeting of the Company to be held inthe year 2024. M/s. N D Kapur & Co. Chartered Accountants New Delhi has confirmedtheir eligibility to act as the Statutory Auditors of the Company.
M/s. Lily & Geetha Associates Chartered Accountants 16 (Old No. 37) Akbarabad 2ndStreet Kodambakkam Chennai 600024 have completed the Statutory Audit for period2018-19 and submitted their Auditors Report to the Shareholder which does not containany Qualification or adverse remark. The observation made in the Auditors Report readtogether with relevant notes thereon are self-explanatory and hence do not call for anyfurther comments under Section 134 of the Companies Act 2013.
REPORTING OF FRAUDS BY AUDITORS
During the year under review neither the statutory auditors nor the secretarialauditors has reported to the audit committee under section 143(12) of the Companies Act2013 any instance of fraud committed against the Company by its officers or employees thedetails of which would need to be mentioned in Board's report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined by the Audit Committee and delegated to Internal Auditor to maintain itsobjectivity and independence. The Internal Auditor reports to the Chairman of the AuditCommittee of the Board and to the Managing Director of the Company.
The Internal Auditor M/s. C. Ramasamy & B.Srinivasan Chartered Accountantsmonitors and evaluates the efficacy and adequacy of internal control system in theCompany its compliance with operating systems accounting procedures and policies at alllocations of the Company and promptly informed the management on the lacking as and whenrequired.
The Company continues to focus on judicious management of its working capital.Receivables inventories and other working capital parameters were kept under strict checkthrough continuous monitoring.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
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. Allloans investment taken/given with proper approval and an incompliance with the applicablelaws.
LISTING ON STOCK EXCHANGES
The Equity shares of the Company are listed on Bombay Stock Exchange Ltd. (BSE) andnecessary listing fee has been paid up to date.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism/Whistle Blower Policy to deal with instance of fraudand mismanagement if any. The details of the vigil mechanism/Whistle Blower Policy isposted on the website of the Company and available in this web link: http://www.uniplydecor.com/docs/policy/ UDL-WHISTLE-BLOWER-POLICY.pdf.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as "AnnexureE".
During the year under review the foreign exchange earned by the Company was Nil andoutgo amounted to RS 471.55 lakhs on account of import and foreign travel expenses.
RISK MANAGEMENT POLICY
Risk Assessment and minimization procedures have been framed by the Company named as"Risk Management Charter" and are reviewed by the Committee from time to time.The Committee has overall responsibility for monitoring and approving the risk policiesand associated practices of the Company. The Duties and Responsibilities of the Committeeare as follows:
Annually review and approve the Risk Management Policy and associatedframeworks processes and practices of the Company.
Ensure that the Company is taking the appropriate measures to achieve prudentbalance between risk and reward in both ongoing and new business activities.
Evaluate significant risk exposures of the Company and access management'sactions to mitigate the exposures in a timely manner.
Co-ordinate its activities with Audit Committee in stances where there is anyoverlap with Audit activities. Within its overall scope as aforesaid the Committee shallreview risks trends exposure and potential impact analysis and mitigation plan.
OBLIGATION OF COMPANY UNDER 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 The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9th December 2013. Under the said Act our company has constituted anInternal Complaints Committee to look into complaints relating to sexual harassment atwork place of any women employee. During the year under review the committee has notreceived or disposed any complaints relating to sexual harassment at work place of anywomen employee. The policy on the same can be viewed in the website of the Company. Theweb link to access the aforesaid programme is www.uniplydecor.com/docs/policy/UDL-POSH-Policy.pdf.
Your Company continuously invests in attraction retention and development of talent onan ongoing basis. A number of programs that provide focused people attention are currentlyunderway. Your Company thrust is on the promotion of talent internally through jobrotation and job enlargement.
During the Year under review Your Company enjoyed cordial relationship with workersand employees at all levels.
TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of the Investor Education Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has already filed the necessary form and uploaded the details of unpaid andunclaimed amounts lying with the Company for a period of seven years as on the date oflast AGM (i.e. 26.09.2018) with the Ministry of Corporate Affairs. The dates by which theunpaid or unclaimed dividend amounts will be transferred to IEPF are as under:
|Financial Year ||Date of Declaration ||Rate of Dividend per share ||Due date for transfer to IEPF |
|2011-2012 ||27.07.2012 ||15% (H0.30) ||02.09.2019 |
|2012-2013 ||11.09.2013 ||15% (H0.30) ||18.10.2020 |
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT
The Corporate Governance and Management Discussion & Analysis Report which form anintegral part of this Report are set out as separate Annexures together with theCertificate from the Auditors of the Company regarding compliance with the requirements ofCorporate Governance as stipulated in SEBI (LODR) 2015.
Your Company wholly recognizes undying concern for ecofriendly environment continuedefforts and worthy contribution to make this planet a safer place.
The Company is committed to the environment. The Company continues to upkeep effluentand chemical treatment plant. Continuous check of air and water pollution at manufacturingunit is made and monitored.
CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility encompassing much more than social outreachcontinuous to be an integral part of the Company's activity. Since the provision is notapplicable to the Company during the year under review the detailed CSR report is notgiven. However since the Company has earned net profit of RS 893.87 lakhs for the yearunder review now the provision is applicable to the Company in the year 2019-20.
SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and the Company's operations in future.
Your Directors take this occasion to express their gratitude for support andcooperation received from financial institutions Central and state governments SEBIstock exchange vendors valued customers and stakeholders. Your directors also expresstheir gratefulness of the efforts put in by the workers and employees of the Company atall levels.
| ||For Uniply Decor Limited |
|Place: Chennai ||Keshav Narayan Kantamneni |
|Date: 14.08.2019 ||Chairman |