The Members of
VELJAN DENISON LIMITED
Your Directors take pleasure in presenting the 43rd Annual Report on the affairs of theCompany along with the Audited Accounts for the year ended 31st March 2017.
1. FINANCIAL RESULTS:
|Particulars ||Year ended ||Year ended |
| ||31-03-2017 ||31-03-2016 |
| ||Rs.in Lakhs ||Rs.in Lakhs |
|Income : || || |
|Revenue from Operations ||8258.60 ||8027.53 |
|Other Income ||66.82 ||49.17 |
|Total Revenue ||8325.42 ||8076.70 |
|Expenditure: || || |
|Cost of Materials Consumed ||2891.65 ||2556.53 |
|Job Expenses ||1102.45 ||925.93 |
|Changes in inventories of Finished goods Work-in- Progress and Stock-in-Trade ||(394.81) ||119.39 |
|Employee Benefit Expenses ||785.43 ||716.35 |
|Finance Costs ||178.91 ||171.15 |
|Depreciation and Amortization Expenses ||256.49 ||243.31 |
|Other Expenses ||1562.75 ||1560.11 |
|Total Expenses ||6382.87 ||6292.77 |
|Profit before Tax ||1942.55 ||1783.93 |
|Tax Expenses || || |
|(1)Current Tax ||672.28 ||606.36 |
|(2)Deferred Tax ||4.50 ||19.85 |
|Profit for the year ||1452.67 ||1254.21 |
|Appropriated as under: || || |
|Dividend proposed || || |
|Tax on Proposed Dividend || || |
|General Reserve ||150.00 ||150.00 |
|Total amount appropriated ||150.00 ||150.00 |
|Earning per Equity Share of the face value of Rs. 10 each Basic and Diluted (in Rs.) ||64.56 ||55.74 |
2. COMPANY'S PERFORMANCE:
During the year under review the sales are 2.87% higher at Rs. 8258.60 Lacs as againstRs. 8027.53 Lacs in the previous year. The Profit before tax for the year is Rs. 1942.55Lacs as against Rs. 1783.93 Lacs for the previous year.
3. FUTURE OUTLOOK:
India is one of the fastest growing markets for hydraulic components like valvescylinders accumulators pumps hydraulic hoses filters etc. Most foreign MNCs in fluidpower are already present in India with some of them here for a long time.
4. EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:
There were no material changes/ commitments affecting the financial position of theCompany between March 31 2017 and the date of Board's Report.
5. MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:
Management Discussions and Analysis Report as required under Regulation 34 of SEBI(Listing Obligation Disclosure Requirements) Regulations 2015 and forms part of thereport.
Your Directors are pleased to recommend the payment of Final Dividend of Rs 10/- pershare (100%) in line with the Dividend policy. The Dividend if approved by theshareholders of the Company in its Annual General Meeting will be paid out of the profitsof the Company to all Shareholders of the Company whose names appear on the Register ofMembers as on the date of the Book Closure
The Company has transferred Rs. 1.50 Crore i.e. 10.32% of the current profits toreserves of the Company.
Your Company has not accepted any deposits from the public during the year under reviewand as such no amount on account of principal or interest on deposits from public wasoutstanding as on the date of the balance sheet.
9. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO:
The information required under Section 134(3)(m) of the Companies Act 2013 read withthe Companies (Account) Rules 2014 with respect to conservation of energy technologyabsorption and foreign exchange earnings/ outgo is annexed to this Report.
10.NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES:
Five meetings of the board were held during the year. For details of the meetings ofthe board and its committees please refer to the Corporate Governance report which formspart of this Annual Report.
None of the directors of the company are disqualified under the provisions of theCompanies Act 2013 or under the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2017 entered with the BSE.
As per the provisions of the Companies Act 2013 read with Articles of Association ofthe Company SriV.C.Janardan Rao retires by rotation and being eligible offers himself forre-appointment at this Annual General Meeting. Board recommends his re-appointment at theAGM.
During the year under review Mr. K Harish Chandra CEO resigned with effect from 21stMarch 2017.
12.STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the companies Act 2013 and Regulation16 of the SEBI (LODR) Regulations 2015.
13.ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE:
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing ObligationDisclosure Requirements) Regulations 2015 the Board has carried out an annualperformance evaluation of its own performance the directors individually as well as theevaluation of the working of its Audit Nomination & Remuneration and ComplianceCommittees.
14.COMPANY'S POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration including criteria for determining qualifications positive attributesindependence of a Director and other matters provided under sub section (3) of section 178relating to the remuneration for the Directors Key Managerial Personnel and otheremployees.
15.INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The Internal audit Department monitors and evaluates theefficacy and adequacy of internal control systems accounting procedures and policies.
The existing Statutory Auditors M/s. Brahmayya & Co. Chartered Accountants wereappointed at the Fortieth Annual General Meeting for a period of three years until theconclusion of the Forty Third Annual General Meeting.
In view of the mandatory requirement for rotation of auditors upon completion of 10years of association with a company in terms of Section 139 of the CA 2013 M/s.Brahmayya & Co. Chartered Accountants will retire as the Company's Auditors at theconclusion of the ensuing Forty Third Annual General Meeting. It is proposed to appointM/s. K S Rao & Co. Chartered Accountants as the new Statutory Auditors of theCompany. M/s. K S Rao & Co. Chartered Accountants are proposed to be appointed for aperiod of five continuous years i.e. from the conclusion of Forty Third Annual GeneralMeeting till the conclusion of Forty Eighth Annual General Meeting of the Company.
M/s. K S Rao & Co. Chartered Accountants have informed the Company that theirappointment if made would be within the limits prescribed under Section 141 of the CA2013 and have also confirmed that they have subjected themselves to the peer reviewprocess of the Institute of Chartered Accountants of India (ICAI) and hold validcertificates issued by the Peer Review Board of the ICAI. M/s. K S Rao & Co. have alsofurnished a declaration in terms of Section 141 of the CA 2013 that they are eligible tobe appointed as auditors and that they have not incurred any disqualification under the CA2013.
The Board recommends appointment of M/s. K S Rao & Co. as Statutory Auditors of theCompany from the conclusion of Forty Third Annual General Meeting up to the conclusion ofForty Eighth Annual General Meeting of the Company subject to ratification at everyAnnual General Meeting.
The Board of Directors places on record its appreciation for the services rendered byBrahmayya & Co. Chartered Accountants as the Statutory Auditors of the Company.
Members' attention is drawn to a Resolution proposing the appointment of M/s. K S Rao& Co. Chartered Accountants as the new Statutory Auditors of the Company which isincluded in the Notice convening the Forty Third Annual General Meeting.
During the year under review the Statutory Auditors of the Company have not reportedany fraud as required under Section 143(12) of the Companies Act 2013.
The Auditor's Report issued by M/s. Brahmayya & Co. for the financial year2016-2017 does not contain any qualification reservation or adverse remarks.
The Board had appointed M/s BS & Company Company Secretaries LLP Hyderabad tocarry out Secretarial Audit under the provisions of Section 204 of the Companies Act 2013for the financial year 2016-17. The report of the Secretarial Auditor is annexed to thisreport. The qualifications reservations or adverse remarks or disclaimers made by theauditor in the report:
|S.NO. ||COMMENTS ||BOARD'S REPLIES |
|1. ||Certain disclosures as required under Section 134(3) of the Act have not been disclosed in the Board's Report. ||As some of the disclosures were not applicable to the Company hence not disclosed. |
|2. ||All the shares held by Promoters are in dematerialisation mode except for 130 shares which are held in physical form ||99.95% of the Promoters shares are held in demat mode only a negligible percentage is held in physical mode. We will ensure the process of completing the demat process of the balance shares. |
|3. ||The Company is in the process of filing various forms returns and reports as required under Various Labour and Specific Acts Rules and Regulations made thereunder. ||Self Explanatory. |
18.TRANSFER OF UNPAID/ UNCLAIMED AMOUNTS TO IEPF:
Pursuant to the provisions of Section 125 of the Companies Act 2013 the UnclaimedDividend which remained unpaid/ unclaimed for a period of 7 years have been transferred bythe company to the Investor Education and protection Fund (IEPF) established by theCentral Government pursuant to Section 125 of the Companies Act 2013.
19.PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
Particulars of loans guarantees and investments have been disclosed in the financialstatements.
20.DETAILS OF SUBSIDIARY ASSOCIATE AND JOINT VENTURE OF THE COMPANY:
The Company doesn't have any subsidiary associate and joint venture.
21.TRANSACTIONS WITH RELATED PARTIES
All related party transactions done by the company during the financial year were atarm's length and in the ordinary course of business. All related party transactions wereplaced in the meetings of Audit committee and the Board of directors for their necessaryreview and approval.
Disclosures pursuant to Accounting Standards on related party transaction have beenmade in the notes to the Financial Statements.
22.CORPORATE SOCIAL RESPONSIBILITY:
As part of its initiatives under "Corporate Social Responsibility (CSR)" theCompany has made contributions as approved by the Committee and is in accordance withSchedule VII of the Companies Act 2013 read with the relevant rules.
The contents of the CSR activities undertaken by the Company have been annexedseparately and forms part of this report.
23.EXTRACT OF ANNUAL RETURN:
Pursuant to the Section 92(3) of the Companies Act 2013 Extract of the Annual Returnis annexed to this report in the prescribed Form MGT 9 (which forms part of this report).
24.PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is annexed to this report and pursuant to Section 136 of the CompaniesAct 2013 and relevant rules thereto the disclosure pertaining to remuneration and otherdetails of employees of the Company are made available for inspection at the Registeredoffice of the Company with the Chief Financial Officer during working hours and any Memberinterested in obtaining such information may write to the Chief Financial Officer and thesame shall be provided without any fee
Details of the ratio of the remuneration of each of the Director to the medianemployee's remuneration and other details as required pursuant to Rule 5(1) of theCompanies (Appointment and Remuneration of managerial Personnel) Rules 2014 has beenannexed separately and forms part of this report.
26.CORPORATE GOVERNANCE CERTIFICATE:
The Compliance certificate from the Statutory Auditors regarding compliance ofconditions of Corporate Governance as stipulated in SEBI (Listing Obligation DisclosureRequirements) Regulations 2015 and forms part of the report.
The Company is listed in The Bombay Stock Exchange Limited and there have been noarrears of the listing fees payable to the Stock Exchange.
28.DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that (based on the representations receivedfrom the Management):
i) In the preparation of Annual Accounts the applicable Accounting Standards have beenfollowed along with proper explanations relating to material departures if any;
ii) they have selected such accounting policies and applied them consistently and madejudgments and estimates that were reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the Financial Year and of theProfit of the Company for that period ;
iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safe guarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv) they have prepared the Annual Accounts on a going concern basis;
v) they have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively;
vi) they have devised proper systems to ensure Compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
29.REPORT ON RISK MANAGEMENT POLICY:
The Company has formed the Risk Management Committee with its members as Shri. V.Pattabhi Shri.B.S.Srinivasan and Shri. M.L. Motwani the committee will perform itsactivities according to the Risk Policy finalized by the Board indicating the developmentand implementation of Risk Management.
30.DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:
The Company has put in place a Prevention Prohibition and Redressal of SexualHarassment at Workplace in accordance with the requirement of the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013. All employees ofthe Company are covered under the aforementioned Policy.
The summary of complaints received and disposed off upto 31st March 2017 were as under:
|Number of complaints received ||Nil |
|Number of complaints disposed off ||Not Applicable |
31.DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS:
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
32.VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
Your Company has an effective Vigil Mechanism system which is embedded in its Code ofConduct. The Code of Conduct applies to all the employees including Directors of theCompany.
The Code of Conduct is available on the Company website to report any genuine concernsabout unethical behavior any actual or suspected fraud or violation of Company's Code ofConduct.
33.REPORT ON CORPORATE GOVERNANCE:
In accordance with the Regulation 16 of the SEBI (LODR) Regulations 2015 the Companyhas complied with all mandatory recommendations. A Report on corporate Governance isprovided elsewhere in this report.
34.MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review is presentedseparately in this Annual Report.
Your Directors acknowledge with a deep sense of gratitude the continued supportextended by Investors Customers Business Associates Bankers and Vendors.
Your Directors take this opportunity to thank the regulatory Authorities andGovernmental Authorities for continued support and assistance.
Your Directors also place on record their appreciation for the contribution of all theemployees of the Company in achieving the performance.
| ||By order of the Board |
| ||FOR VELJAN DENISON LIMITED |
|Place: Hyderabad ||V. C. Janardan Rao |
|Date: 26/08/2017 ||Chairman & Managing Director |
| ||DIN: 00181609 |