Your Directors' present to you their 33 Annual Report together with the AuditedAccounts for the financial year ended 31 March 2017.
The summarized financial results of the Company for the year ended 31st March 2017 andfor the previous year ended 31st March 2016 are as follows:
|FINANCIAL RESULTS FOR THE ||YEAR ENDED 31.03.2017 || |
| || ||(Rs. Lacs) |
|Particulars ||Year Ended ||Year Ended |
| ||31.03.2017 ||31.03.2016 |
|Total Income ||397.84 ||61.13 |
|Operating Expenses ||234.29 ||39.06 |
|Profit before Finance Cost Depreciation & Amortisation Exp. ||163.55 ||22.07 |
| ||49.23 ||2.75 |
|Depreciation & Amortisation Exp. || || |
|Financial Expenses ||44.29 ||19.02 |
|Profit/Loss before Tax ||70.03 ||0.30 |
|Provision for Tax ||13.35 ||0.06 |
|Profit/Loss after Tax ||56.68 ||0.24 |
|Earning per share Basic and Diluted ||1.89 ||0.01 |
During the year the turnover of the Company is Rs. 397.84 Lacs increased as againstthe previous year turnover of Rs. 61.13 Lacs and the profit before finance costDepreciation and Amortization is also increased to Rs.163.55 Lacs from the previous yearRs.22.07 Lacs in current year. Addition in capacity with installation of 2 new fullyComputerized Embroidery machines purchased during the year.The Profits of the Company hasincreased to Rs. 56.68 Lacs to last year profit of Rs. 0.24 Lacs.
Your Company's Information for the year under review is given in greater detail in theManagement Discussion andAnalysis which forms part of thisAnnual Report.
The Board of Directors has not recommended any dividend for the FinancialYear 2016-17.
Total members Fixed Deposits as on 31 March 2017 were Rs.35.46 Lacs. No fresh depositswere accepted during the financial year 2016-17.There were no unclaimed deposits as atMarch 31 2017.
DEMATERIALISATION OF SHARES
The shares of the Company are under compulsory dematerialized trading.The Company'sISIN No. is INE357P01014.The number of shares is dematerialized as on 31.3.2017 follows:
|*NSDL ||: ||NIL |
|CDSL ||: ||17035 Shares |
*The Company has also applied for registration with NSDL for dematerialization ofshares.
MEETINGS OFTHE BOARD:
The strength of Board of Directors as on March 31 2017 was 7 Directors.The Boardcomprise of one Executive Director and two Executive Non Independent Directors. The Boardmeets the requirement of not less than half of the Board being Independent Directorsthe Chairperson being a promoter Director.
|Date of Meetings ||BoardStrength ||No. of Directors present |
|14 May2016 ||06 ||05 |
|05 August2016 ||06 ||05 |
|03 November2016 ||06 ||06 |
|24 December2016 ||06 ||04 |
|13 Feburary2017 ||07 ||06 |
The maximum time gap between any two meetings was not more than 120 days.
The composition of Board of Directors and attendance of Directors at the Board Meetingsduring the year and at the last Annual General Meeting and also number of otherdirectorships committee memberships and chairmanship held by them are given below:
|Name of Directors ||DIN ||Details || |
No. of other Directorships and Committee
| || || || || || |
Memberships/ Chairmanship held in Public Limited Companies
| || ||Category ||Board Meeting ||AGM ||Directorship ||Committee Membership ||Committee Chairmanship |
|Mr. Anil Kumar Khanna ||00207839 ||Promoter ||05 ||Yes ||15 ||02 ||01 |
|Mr. Kapil Dutta ||00964585 ||I.N.E.D. ||03 ||No ||03 ||01 ||Nil |
|Mr. V.K Batra ||00601619 ||I.N.E.D. ||05 ||Yes ||05 ||01 ||Nil |
|Mr. Vipin Bali ||01890854 ||I.N.E.D. ||05 ||No ||Nil ||Nil ||Nil |
|Mrs. Vimal Kumari ||07225462 ||I.N.E.D. ||03 ||Yes ||Nil ||Nil ||Nil |
|Mr. Ashish Khanna* ||01251582 ||A.D. ||01 ||- ||09 ||Nil ||Nil |
|Mr.Aditya Khanna* ||01860038 ||A.D. ||01 ||- ||07 ||Nil ||Nil |
Mr.Ashish Khanna and Mr.Aditya Khanna was appointed on 24.12.2016 as additionaldirector.
E.D.-Executive Director I.N.E.D.- Independent Non Executive DirectorandA.D.-Additional Director.
|AUDIT COMMITTEE: || || |
|Name ||Chairman/Member ||No. of meeting(s) attended |
|Mr. Kapil Dutta ||Chairman ||2 |
| || ||4 |
|Mr. Anil Kumar Khanna ||Member || |
|Mr. Vipin Bali ||Member ||4 |
|Mrs. Vimal Kumari ||Member ||2 |
Brief description of terms of references:
The role and the powers of the Audit Committee are as per the guidelines set out in theListing Agreement with the Stock Exchanges.The Committee also acts as a link between theauditor and the Board of Directors.The Committee meets the auditors periodically andreviews the quarterly/ half yearly and annual financial statements and discusses theirfindings and suggestions and seeks clarifications thereon.
The audit committee met four times during the financial year 2016-17 on 14th May201605th August2016 03rd November2016 and 13th Feburary2017. The attendance of meeting isgiven hereunder:-
NOMINATION & REMUNERATION COMMITTEE:
Composition of the Committee and category of Directors as decided by the Board ofDirectors.
Nomination & Remuneration Committee was constituted to comply with the provisionsof the Companies Act 2013 and Regulation 19 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
Nomination & Remuneration Committee met four time 14th May 2016 05th August201603rd November2016 and 13th Feburary 2017. The attendance of meeting is given hereunder:-
|Name ||Chairman/Member ||No. of meeting(s) attended |
|Mr. ||Vipin Bali ||Chairman ||4 |
|Mr. ||Kapil Dutta || |
|Mr. V.K. Batra ||Member ||4 |
STAKEHOLDER RELATIONSHIP COMMITTEE:
The Stakeholder Relationship Committee was constituted to comply with the CompaniesAct 2013 and Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
The Stakeholder Relationship Committee met four times during the financial year 2016-17on 14 May2016 05 August2016 03 November2016 and 13 Feburary2017.
The attendance at its meeting is given hereunder:
|Name ||Chairman/Member ||No. of meeting(s) attended |
|Mr. V.K. Batra ||Chairman ||4 |
|Mr. Vipin Bali ||Member ||4 |
|Mr. Kapil Dutta ||Member ||2 |
INDEPENDENT DIRECTOR'S MEETING:
The Independent directors met four times in separate meeting during the financial year2016-17 on 14th May2016 05th August2016 03rd November2016 and 13th Feburary2017.
The Declaration of Independent Director is attached as perAnnexure -A.
KEY MANAGERIAL PERSONNEL:
During the year under review there has been a change in the Key Managerial Personnelof the Company.The details of the same are enlisted below:-
|Name of the Key ||Designation ||Date of Appointment ||Date of Resignation |
|Managerial Personnel || || || |
|Mr. Bishwadeep Akhouri ||Chief Financial ||14.05.2016 ||13.02.2017 |
| ||Officer || || |
|Mr. Ashish Khanna ||Chief Financial ||13.02.2017 ||- |
| ||Officer || || |
|Mr. Niraj Kumar ||Company Secretary ||12.02.2016 ||28.03.2017 |
| || || ||- |
|Ms. Mansi Mehta ||Company Secretary ||04.04.2017 || |
CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per section 135 of the CompaniesAct 2013 Corporate Social Responsibility are notapplicable to our company.
With the enactment of Section 135 of the CompaniesAct 2013 and the Companies(Corporate Social Responsibility) Rules 2014 read with various clarifications issued bythe Ministry of CorporateAffairs every Company having the net worth of Rs.500 Crores ormore turnover of Rs.1000 Crores or more or net profit of Rs.5 Crores or more during anyfinancial year have to spend at least 2% of the average net profit of the Company madeduring the three immediately preceding financial years.
In pursuance of the Companies Act 2013 and the Companies (Corporate SocialResponsibility) Rules 2014 the above rules are not applicable to the company during theyear as the company has deserved Loss in this financial statement.
COMPLIANCE UNDERTHE COMPANIESACT 2013ANDADDITIONAL SEBI STIPULATIONS
The CompaniesAct 2013 (Act) came into force substantially from 01stApril 2014.AlsoSEBI in its master circular dated 17thApril 2014 notified additional requirements oncorporate governance which will be effective from 01st October 2014.The Act and the SEBIstipulations set the tone for a more modern legislation which enables growth greaterregulation and self-governance of India's corporate sector. The Act and SEBI'srequirements are expected to improve corporate governance norms enhance theaccountability of companies and their auditors improve transparency and protect theinterest of investors particularly small ones.
These requirements substantially increase the compliance requirements for companies.The Company is taking all the necessary steps to be compliant with theAct within the timestipulated.
CORPORATE GOVERNANCE REPORT
A separate section on Corporate Governance is included in theAnnual Report and theCertificate from the Company's Statutory Auditors confirming the compliance of conditionsof Corporate Governance as stipulated under ListingAgreement/ SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 isAnnexure 'D'.
Pursuant to the provisions of the Companies Act 2013 and the Clauses of the ListingAgreement/ Regulations of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Independent Directors on the Board carried out an annual evaluationof its own its Committees the Chairperson and the Directors.
Thereafter it was discussed that during the financial year the Board delivers itsresponsibilities by following ways:
Strategy: Board effectively provides strategic directions to the company.
Performance of Management: Board provides effective directions on key decisionsimpacting the performance of the company effectively reviews the financial performance ofthe company and suggests corrective actions.
Governance & Compliance: Board strives towards adapting best practices ingovernance while also fully complying with the laws of land.
Overall:The process for setting the board agenda is transparent realistic to thecurrent needs and meeting material is shared well in time. The frequency and duration ofthe board meetings are adequate to ensure a proper discharge of all the responsibilities.Over all board meeting is held in open and objective manner where there is adequateopportunity for members to share their views.
Performance of Non-Independent Directors: the Non Independent directors on the Boardhave played a good role in better corporate governance. The Board received requireddisclosures from them. Based on formal and informal appraisals the Non Independentdirectors have played role in good governance and handling of day to day affairsefficiently cost cuttings market strategies expansion and growth of Company.
Technology up gradation: ID's discussed and concluded that Company uses latestavailable technology in its manufacturing operations.
Marketing and Sales: The Company has a team of Experienced Marketing/ Sales Team wholooks after their functions diligently and their performance can be adjudged byoperational results.
RELATED PARTY TRANSACTION
None of the transaction with any of related parties were in conflict with the Company'sinterest. Suitable disclosures as required by theAccounting Standards I8 (AS I8) issuedbyThe Institute of CharteredAccountants of India (The ICAI) have been in the notes to theFinancial Statements.
All related party transaction are negotiated on arm-length basis and are in theordinary course of business. Therefore the provisions of section 188(1) of the CompaniesAct2013 has been in the compliance. Further the board of the Company has given itsapproval to transaction with the related parties.
The details of the transaction with Related Party are provided in the FormAOC 2 whichis annexed to the board report thereto.
PARTICULARS OF LOANSAND GUARANTEESAND INVESTMENTS
The Company has not made any investment and guarantees during the period and has notgranted any loan during the period under review.
During the year under review the Company has de-invested the Equity Shares at cost.
VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower policy to provide a formal mechanism to theDirectors and employees of the Company for reporting genuine concerns about unethicalpractices and suspected or actual fraud or violation of the code of conduct of the Companyas prescribed under the Companies Act 2013 Clause 49 of the Listing Agreement andRegulation22 of the Listing Obligation and Disclosure Requirements 2015.
This Vigil Mechanism shall provide a channel to the employees and Directors to reportto the management concerns about unethical behavior and also provide for adequatesafeguards against victimization of persons who use the mechanism and also make provisionfor direct access to the chairperson of theAudit Committee in appropriate or exceptionalcases. It is affirmed that no personnel of the company has been denied access to theAuditCommittee.
TheWhistle Blower policy is displayed at the Company's website www.ulilltd.com.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONANDREDRESSAL)ACT 2013
Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. There were no complaint received from any employee during thefinancial year 2016-17 and hence no complaint is outstanding as a 31.3.2017 forcompliance.
CONSERVATION OF ENERGY
The Company does not belong to the category of power intensive industries and henceconsumption of power is not significant. However the management is aware of theimportance of conservation of energy and also reviews from time to time the measurestaken/ to be taken for reduction of consumption of energy.
During the year your Company was running successfully its embroidery unit in Gurugramcomprising of computerized embroidery machines of high quality purchased from SaurerSwitzerland the company is going for up gradation of these machines on phase manner whichis likely to bring higher efficiency in the coming years.
|FOREIGN EXCHANGE ||EARNINGS ||AND OUTGO |
|Total Foreign exchange earned ||: ||Rs. Nil |
|Total Foreign exchange used ||: ||Rs. 44455188 |
M/s Raj Anirudh & Associates Chartered Accountants (Firm Registration No.020497N) New Delhi was appointed as the StatutoryAuditors of the Company in theAnnualGeneral Meeting held in the year 2016 for a period of 5 years.
Your directors recommended to ratify their re-appointment for the Financial Year2017-18 in the forth coming Annual General Meeting.
The Board of Directors of your Company has appointed Mr. Harish Rawat asInternalAuditors pursuant to the provision of section 138 of the Companies Act 2013 forthe financial year 2017-18.
The Board has re-appointed M/s. Choudhary Pankaj &Associates a firm of CompanySecretaries in practice as SecretarialAuditor pursuant to the provisions of Section 204of the Companies Act 2013. The Report of the Secretarial Auditors (Form MR-3) annexed tothe Report as perAnnexure 'B'.
EXTRACTS OFANNUAL RETURN
The extracts of theAnnual Return as per section 92(3) of the CompaniesAct2013 and rule12(1) of the Companies (Management andAdministration) Rules2014 in the Form MGT 9 isattached asAnnexure-'C'.
MANAGEMENT'S DISCUSSION &ANALYSIS 2016-17
United Leasing & Industries Ltd is having a manufacturing unit of embroideredfabrics in Gurugram and has significant holding of real estate land parcel in the districtof Gurugram in Haryana India.
The Company is well positioned in terms of capacities capabilities and establishedrelationships to capitalised on market opportunities. While market conditions will becompetitive we see incremental opportunities in both domestic and overseas market.
TEXTILE CLOTHING AND FIBRE INDUSTRY
The textiles and apparel industry is highly matured and has strong correlations withglobal macro-economic developments. The industry relies on transnational specializationand involves a healthy level of global trade. The macro-economic trend of shiftingmanufacturing operations in the mid to lower value stream of the industry to relative lowcost emerging economies is quite widespread for textiles and apparels. Also new avenuesof growth in demand are primarily in emerging markets while the sheer size of the largeadvanced economies like USA and Europe still remain the largest markets for the globalindustry.
The high growth in the market will be primarily driven by the increase in population aswell as the per capita apparel spending of the already large population in thesecountries.
Indian textiles industry is a well-established with showing strong features and abright future.The textiles manufacturing business is a pioneer activity in the Indianmanufacturing sector and it has a primordial importance in the economic life of thecountry which is still predominantly based on the agro-alimentary sector.
The success of Indian textiles lies in effective vertical integrations policies whichhave helped operators in taming the processes which while lying beyond simplemanufacturing exercise do have a serious impact on it for example raw materialtreatment.
There may be a few drawbacks for the textile industry due to the higher tax rate andremoval of benefits under cotton value chain but it is safe to say that GST will helpthis industry in the long run by getting more registered taxpayers under a well-regulatedsystem. It can also be hoped that GST will help the textile industry to get morecompetitive in both the global and domestic markets and create opportunities forsustainable long-term growth.
THREATS RISK & CONCERNS
On exports front there are both positive and negative factors. Positive factorsinclude the weak currency and decreasing cost competitiveness of China that are likely togive positive impetus to the Indian Exports.At the same time factors like slowdown anduncertainty in the global markets volatile foreign exchange rates and increase in cottonand yarn prices are likely to negatively affect growth and profitability for the textileexports. Interest expenses are part of the finance costs therefore any major upwardfluctuations in the Interest rates leads to increase in the cost of debt of the Company.The interest rate risks are mitigated to an extent through fixed interest rates on the nonconvertible debentures.
The biggest challenge facing the Indian textile industry is competition from the otherlow cost neighboring countries which attract more business from the international marketbecause of lower production costs ease in doing business and easier trade routesaccording to an industry expert.
RESEARCH & DEVELOPMENT (R&D)
Your Company continues to derive sustainable benefit from the strong foundation andlong tradition of Research & Development (R&D) which differentiates it from manyothers. New products processes and benefits flow from work done by the team of in housedesigners.This allows us to enhance quality productivity and customer satisfactionthrough continuous innovation. In order to successfully carve a niche of our own we needto develop a vital competitive edge in the design development to stay ahead of thecompetition.
HUMAN RESOURCE DEVELOPMENT/ INDUSTRIAL RELATION.
HR function is at the core of the Company and plays a major role in nurturingenhancing and retaining talent through job satisfaction management development programmeetc. The Company has an induction process and Goals/Deliverables are in place foremployees based on which appraisals are done.
The primary objective of ULIL ("the Company")is to bring about organizationaleffectiveness by helping employees achieve their personal goals in a manner that enhancesthe overall performance of the Company.
The fundamental driver of any Company is its people and Industry there has always beenextended focus on the Management of Human Resources. It is widely recognized that theCompany's employees are the most valuable asset to the organization and will play apivotal role in helping the business overcome its present challenges. The belief is thatwith a well-motivated and energized work force nothing is impossible.
ENVIRONMENT OCCUPATIONAL HEALTH SAFETY
Company's Environment Health & Safety (EHS) strategies are directed towardsachieving the greenest and safest operations by optimizing natural resource usage andproviding a safe and healthy workplace. Systemic and structured efforts continue to bemade towards natural resource conservation by continuously improving resource-useefficiencies.
As we continue to bring about energy efficiencies in our operations we also strive tosubstitute our energy consumptions with increased component of renewable energy. The Plantof the Company is eco-friendly and do not generate any harmful effluents. Safety deviceshave been installed wherever necessary.
RISK MANAGEMENT SYSTEM
The Company's business is exposed to both external and internal risks.Your Company hasincorporated processes and systems to proactively monitor manage and mitigate these risksalong with appropriate review mechanisms.
PARTICULARS OF EMPLOYEES
In terms of the provision of Section 197 of the Act read with Rules 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 Noemployee is drawing remuneration in excess of the limits set out in the said rules areprovided in theAct.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the explanations obtained bythem your Directors make the following statements in terms of Section 134(3)(c ) of theCompaniesAct 2013:
(i) In preparation of the annual accounts the applicable accounting standards had beenfollowed along with proper explanation 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 March31 2017 and the Profit of the company for that period;
(iii) The Directors have been taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing / 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 financialcontrols to be followed by the company and that such financial controls are adequate andoperating effectively.
(vi) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Your Directors wish to thanks the collaborators financial institutions bankerscustomers suppliers shareholders and employees for their continued support andco-operations.
| ||For and On behalf of the Board |
| ||United Leasing & Industries Limited |
| ||Sd/- |
|Date : 29th May2017 ||(Anil Kumar Khanna) |
|Place : Gurugram Haryana ||Chairman |
| ||DIN: 00207839 |