Your Directors have pleasure in presenting the 37th Annual Report together with theAudited Financial Statements of the Company for the financial year ended 31st March 2018.
(Rs. in lacs)
|Financial Highlights ||Year ended ||Year ended |
| ||31.3.2018 ||31.3.2017 |
|Sales ||69961.82 ||71494.39 |
|Profit before Interest & Depreciation ||7994.23 ||11371.79 |
|Less : Interest ||4835.22 ||5434.06 |
|Profit/(Loss) before Depreciation ||3159.01 ||5937.73 |
|Less : Depreciation ||2470.75 ||2738.56 |
|Profit/ (Loss) before Tax ||688.26 ||3199.17 |
|Less : Provision for Taxation - Current Tax(MAT) ||153.47 ||1011.79 |
|- MAT Credit ||(153.47) ||- |
|- Deferred Tax Liability/(Assets) ||422.69 ||1.95 |
|- MAT Credit earlier year/Charged Earlier Year ||- ||- |
|- Tax/MAT for earlier years ||(280.46) ||- |
|- Tax Adjustment for the earlier year ||49.79 ||- |
|Net Profit/ (Loss) after Tax ||496.24 ||2185.43 |
|Add : Surplus brought from previous year ||9766.38 ||7580.95 |
|Less: Adjustments & amounts transferred to General || || |
| ||(7273.65) ||- |
|Reserves || || |
| ||2988.97 ||9766.38 |
|Appropriations : || || |
|Proposed Dividend ||NIL ||NIL |
|Corporate Dividend Tax ||NIL ||NIL |
|Surplus Carried to Balance Sheet ||2988.97 ||9766.38 |
| ||2988.97 ||9766.38 |
During the year under review your Company has achieved a sales turnover of Rs.69961.82 lacs as against sales turnover of Rs. 71494.39 lacs during the previous yearshowing a decrease of 2.14% and a net profit (after tax) of Rs. 496.24 lacs for the yearagainst net profit (after tax) of Rs. 2185.43 lacs during the previous year. The exportsof the company for the current financial year were of Rs. 25570.84 lacs against Rs.27896.59 lacs for the previous financial year.
The Profitability of your company in the current year has been impacted by the twomajor changes that have a_ected businesses throughout the country especially textiles.Demonetization done in October/ November 2016 had huge impact on demand for yarn and bythe time industry recovered from it the Goods and Services Tax (GST) was implemented.Both these factors resulted in low demand of products which led to dumping of yarn in themarket at low prices. Further your Company exports substantial quanity of Yarn and Fabricbut downward revision of export incentives in July 2017 post GST further resulted in poorsales realisation thereon.
However impact on the performance of the Company due to above said factors during thelast year have now been greatly neutralized and performance of the Company is expected tobe better during next financial year.
ACCOLADES AND RECOGNITIONS
We are delighted to inform you that your Company was conferred with Silver Trophy byTEXPROCIL' for second Highest Exports of Cotton Yarn (Processed Yarns) in theCategory II for F.Y. 2016-17. Apart from this your Company is making persistent e_orts tomaintain its distinguish position in the competitive environment.
HYDRO POWER PROJECT OF COMPANY
The Company's Manuni Hydro electric Power Project (3.5 M.W.) at Dharamshala Distt.Kangra Manuni Khad (H.P.) has been synchronized with H.P.S.E.B.L. Grid on 31.03.2017. TheProject has generated about 97 lac units during the FY 2017-18.
MODERNISATION & EXPANSION
During the year under review the Company has taken several progressive steps formodernization cum expansion of plants. Major details are listed below: (a) Company hasinstalled 02 nos. of machines in dye house for the Financial Year 2017-18. (i) RF Dryer 85KW From Stalam - This will help us in further increasing drying capacity of the dye houseand (ii) Tecnorama Dyerama - Installation of said machine will increase our recipegeneration and will also increase our Right First Time Dyeing (RFT).
(b) This year we have added 04 nos. new Trutzschler TC10 cards in our process. Withthese initiatives we will be able to enhance our value added yarn production.
(c) We have also added Carton stretch wrapping machine. Due to this installation wecover the packed carton with Poly Propylene to avoid the moisture and water inside thecarton.
(d) We have added ULTRA VIOLET COTS TREATMENT MACHINE due to which we will be able toreduce the breakage at di_erent stages and also improve the yarn quality (e) We have addednew waste collection plant for increasing the card cleaning e_ciency and separation ofcotton and polyester waste.
The paid up Equity Share Capital as at March 31 2018 was Rs. 198200000/- (comprisedof 19820000 equity shares of Rs. 10/- each). During the year under review the Companyhas neither issued any shares nor granted stock options or sweat equity preference sharesand also not made any provision for purchase of its own shares by employees or bytrustees.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The company has not given any loan or provided any security / guarantee as per Section186 of the Act during the year 2017-18. The investments under section 186 of the Act aregiven in the Financial Statements forming part of the Annual Report.
The Company has not accepted or renewed any deposits from the public during the FY2017-18.
DIVIDEND & RESERVES
Keeping in view to conserve the resources your Directors do not recommend any dividendfor the FY 2017-18. The Company has proposed to carry Rs. 7313.96 Lacs from surplus in theP&L account to General reserves.
The unclaimed dividend of FY 2010-11 is due to be transferred to Investor Education andProtection Fund in the month of August/September 2018. The equity shares of allshareholders who have not claimed the dividend for last seven consecutive years shall alsobe transferred to the above said Fund. The concerned shareholders have been individuallyinformed about the same and have been requested to encash their unclaimed dividend toavoid transfer of the same along with equity shares to the above said Fund. Although theunclaimed dividend and shares transferred to the Fund can be claimed by the concernedshareholders even after the above said transfer by approaching the Investor Education andProtection Fund Authority.
NUMBER OF MEETINGS HELD
The details of Board and Committee Meetings are given in the Corporate GovernanceReport.
DIRECTORS / KEY MANAGERIAL PERSONNEL
There was no change in the Directors during the FY 2017-18. Shri Ashish BagrodiaChairman & Managing Director shall be liable to retire by rotation at the ensuingAnnual General Meeting being eligible has offered himself for re-appointment.
As per recent notification by SEBI the non-executive Directors who have attained theage of seventy five years can not continue as such after 1st April 2019 unless theirappointment/continuation have been approved by shareholders through special resolution. Ason date three Independent Directors of the Company namely Sh. Chander Mohan Sh. SatishGirotra and Sh. Amrit Lal Batra have already attained the above said age limit. In thisregard respective resolutions have been proposed in the Notice of Annual General Meetingfor variation in their appointment to the extent that they can continue to be directorseven after attaining age of seventy five years.
Furthermore there was a change in the Key Managerial Personnel during the year2017-18. Shri Sourabh Gupta Company Secretary & Compliance O_cer has resigned w.e.f.23rd June 2017 and in his place Shri Videshwar Sharma has joined as Company Secretary& Compliance O_cer w.e.f. 26th July 2017
As per Companies Act 2013 and Listing Regulations Board has adopted formal mechanismfor evaluating its performance and as well as that of its committees individualDirectors including the Chairman of the Board in compliance of Companies Act 2013 andListing Regulations. The exercise was carried out through a structured evaluation processcovering various aspects of the Boards functioning such as composition of theBoard its committee & members their experience & competencies performance ofspecific duties & obligations and governance etc. Broadly the performance ofNon-Independent/Executive/Whole Time Director(s) was evaluated on the basis of their ownperformance expertise intelligence their qualitative & quantitative contributiontowards operational achievements organizational performance etc. The performance ofNon-Executive Independent Directors were evaluated on the basis of their constructiveparticipation's in Board/Committee/General meetings their informed & balanceddecision-making ability to monitor financial controls systems & certain alliedparameters. The performance evaluation of various Board Committees constituted underCompanies Act & Listing Regulations was made on the basis of their respective terms ofreference discharge of functions governance etc. The separate Meeting of independentDirectors was held on 03rd February 2018 to review the performance of Non-Independentdirectors including the Chairman and the Board as a whole as per Code of IndependentDirectors under Companies Act 2013 and Listing Regulations. The Independent Directors alsoreviewed the quality content and timeliness of follow of information between Managementand the Board. The Performance Evaluation Policy of Board of Directors is uploaded on theCompany's website i.e. www.winsometextile.com under corporate policies.
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Key Managerial PersonnelSenior Management and their Remuneration. The said policy has also been uploaded on thewebsite i.e. www.winsometextile.com of the Company. The Key provisions ofNomination and Remuneration policy are appended as an Annexure I to the Board'sreport.
The company has duly constituted an Audit Committee the scope of which is quitecomprehensive and is in conformity with the provisions of the Companies Act 2013 andListing Regulations. The composition of the Audit Committee is given in CorporateGovernance Report. All the recommendations of the Audit Committee were accepted by theBoard.
DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted the Whistle Blower Policy/Vigil mechanism for directors andemployees to report concerns about unethical behavior actual or suspected fraud orviolation of the Company's Code of Conduct and Ethics. Such mechanism/policy has also beenuploaded on the website of the Company i.e. www.winsometextile.com under corporatepolicies.
At the 36th Annual General Meeting of Company held on 04th September 2017 M/s B.Chhawchharia & Co. Chartered Accountants were appointed as Statutory Auditors ofCompany for a period of five years i.e. from the conclusion of 36th Annual GeneralMeeting of Company till the conclusion of 41st Annual General Meeting of Company subjectto the ratification of their appointment by the members at every subsequent Annual GeneralMeeting as per the provisions of section 139 of Companies Act 2013 read with Companies(Audit & Auditors) Rules 2014.
Furthermore as per the Companies Amendment Act 2017 the above said requirement ofratification at every subsequent Annual General Meeting has been done away with. So theapproval of the shareholders have also been sought to approve the variation in terms ofappointment of Statutory Auditors to incorporate such changes in their remaining tenure ofappointment. After the approval of shareholders there shall be no requirement of annualratification of Auditor's appointment of Statutory Auditors.
Furthermore for the current ratification the Company has received aLetter/certificate of Eligibility in terms of provisions of section 139 of the CompaniesAct 2013 read with Companies (Audit & Auditors) Rules 2014 from M/s B. Chhawchharia& Co. Chartered Accountants to the e_ect that ratification of their appointment forthe FY 2018-19 if made would be in accordance of provisions of section 141 of theCompanies Act 2013 and Rules made there under and that they are not disqualified for suchappointment within the meaning of section 141 of the Companies Act 2013 the CharteredAccountants Act 1949 and rules & regulations made there under.
The auditor's report is self-explanatory and requires no explanation.
COST AUDIT & AUDITOR
M/s Aggarwal Vimal & Associates Cost Accountants were appointed as Cost Auditorsof your Company for auditing the cost accounts records for the financial year 2017-18under provisions of Section 148 of the Companies Act 2013. They are likely to submit CostAudit Report within the prescribed time limit.
Furthermore the Board has re-appointed M/s Aggarwal Vimal & Associates CostAccountants as Cost Auditors of the Company for the financial year 2018-19 on aremuneration of Rs.75000/- (Rupees Seventy Five Thousand only). The Company has receivedwritten confirmations from M/s Aggarwal Vimal & Associates Cost Accountants to thee_ect that their appointment if made would be in accordance of provisions of section 148of Companies Act 2013 and that they are not disqualified for such appointment within themeaning of section 141 of Companies Act 2013 read with Companies (Audit & Auditors)Rules 2014.
SECRETARIAL AUDIT & AUDITORS
Shri Ramesh Bhatia Practicing Company Secretary was appointed to conduct thesecretarial audit of the Company for the financial year 2017-18 as required under Section204 of the Companies Act 2013 and Rules made there under. The secretarial audit reportfor FY 2017-18 is appended as an Annexure II to the Board's report. The Secretarialauditors' report for the year under review requires no comments.
Furthermore the Board has re-appointed Shri Ramesh34 Bhatia Practicing CompanySecretary as secretarial auditor of the Company for the financial year 2018-19.
RELATED PARTY TRANSACTIONS
All Related Party transactions entered during the financial year were on arm's lengthbasis and in the ordinary course of business. There were no materially significant relatedparty transactions with the Company's Promoters Directors Management or their relativeswhich could have had a potential conflict with the interests of the Company. Transactionswith related parties entered by the Company in the normal course of business areperiodically placed before the Audit Committee for review under omnibus approval route.There was no material contract or arrangement or transactions with Related Party duringthe year. Thus disclosure in form AOC-2 is not required.
The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 therules there under and Listing Regulations. This Policy as considered and approved by theBoard has also been uploaded on the website i.e. of the Company athttp://www.winsometextile.com/files/pdf/68-63-file.pdf.
PARTICULARS OF EMPLOYEES
The information under 197 read with rule 5(1) 5(2) & 5(3) of Companies(Appointment and Remuneration of Managerial Personnel) Rules is appended as an AnnexureIII & Annexure IV to the Board Report.
EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3) (a) of the Companies Act 2013 an extract of theannual return in the prescribed format is appended as an Annexure V to the Board'sreport.
The company maintained healthy cordial and harmonious industrial relations at alllevels.
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY
The Company has been addressing various risks through well defined risk managementpolicy/ procedures which in the opinion of the Board may threaten the existence of theCompany. The Company has in place a mechanism to inform the Board about the riskassessment and minimization procedures and periodical review to ensure that managementcontrols risk through means of a properly defined framework. The Company has formulatedand adopted Risk Management Policy to prescribe risk assessment management reporting anddisclosure requirements of the Company. The said policy is available on the website of theCompany i.e. www.winsometextile.com.
INTERNAL FINANCIAL CONTROL SYSTEMS
The Company has laid down adequate internal financial controls with reference tofinancial statements.
During the year such controls were tested and no material weakness in their operatinge_ectiveness was observed.
Further the Company has an adequate system of internal control system in placecommensurate with its size and operations. It ensures that all transactions areauthorized recorded and reported correctly. To maintain its objectivity and independencean in-house Internal Audit Department of Company continuously monitors and evaluates thee_cacy and adequacy of internal control system in the Company its compliance withoperating system accounting procedures and policies/SOP's at all the location of theCompany. Significant audit observation and corrective actions thereon are presented toAudit Committee. The Audit Committee regularly reviews the reports submitted by InternalAudit Department.
ASSOCIATES AND SUBSIDIARIES
The Company has no Associates & Subsidiaries as on March 31 2018.
During the year Company has got approval to open a Branch o_ce in Poland fromrespective authorities. The concerned branch shall cater to the textile market in theCentral Europe. The said branch is likely to operational in second quarter of FY 2018-19.
CORPORATE GOVERNANCE AND COMPLIANCE WITH SECRETARIAL STANDARDS
As per the provisions of Listing Regulations a separate Report on Corporate Governancepractices followed by the Company together with a Certificate from the Practising CompanySecretary confirming compliance forms part of this report. Furthermore the Company hascomplied with Secretarial Standards issued by Institute of Company Secretaries of India onBoard Meetings and General Meetings.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO
As required under Section 134(3)(m) of the Companies Act 2013 read with Rule 8 ofCompanies (Accounts) Rules 2014 the particulars relating to conservation of energytechnology absorption and foreign exchange earnings and outgo are appended as an AnnexureVI to the Board's Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
It is the Company's intent to establish itself and remain as a responsible Corporateentity conscious of its social responsibilities towards its work force society andenvironment. Corporate Social Responsibility (CSR) policy is framed under provisions ofSection 135 of Companies Act 2013 & rules made there under having following majorobjectives:
To identify and formulate projects and areas in response to the needs of society and toimplement them with full involvement and commitment in a time bound manner.
To adopt an approach that aims at achieving a greater balance between social andeconomic development.
To implement CSR Activities/CSR programmes primarily in the economic vicinity Company'soperations with a view to ensuring the long term sustainability of such interventions.
Contribution to the society at large by way of socio-economic activities and socialawareness ensuring that benefits reach the targeted beneficiaries.
To comply with the requirements of Companies Act and all other applicable Acts RulesRegulations framed by the Government.
The CSR activities may be focused not just around units/plants and o_ces of theCompany but also in other geographies based on the needs of the communities/society. Inpursuance to CSR Policy Company has decided to conduct or undertake all or any ofprescribed activities/activity/sub-activity as mentioned in Schedule VII of the CompaniesAct 2013 and rules & regulations made there under (as amended). The Corporate SocialResponsibility (CSR) Committee of Company regularly monitor/review the CSR activities/CSRprojects its mechanism & other prescribed activities/matters. CSR policy is availableon website of Company at following weblink:http://www.winsometextile.com/files/pdf/68-59-file.pdf. Annual Report on Corporate SocialResponsibility [CSR] activities is appended as an Annexure VII
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There were no significant and material orders passed by the Regulators or Courts orTribunals impacting the going concern status and Company's operations.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the provisions of section 134(3)(c) and 134(5) of Companies Act 2013 itis hereby confirmed that:
in the preparation of annual accounts for the financial year ended 31st March 2018the applicable accounting standards have been followed and that there are no materialdepartures;
the Directors have selected such accounting policies and applied them consistently andmade judgements and estimates that were reasonable and prudent so as to give a true andfair view of the state of a_airs of the Company as at 31st March 2018 and of the profitor loss of the Company for the year ended on that date;
the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
the annual accounts have been prepared on a going concern basis;
the Directors have laid down internal financial controls to be followed by the companyand that such internal financial controls are adequate and are operating e_ectively;
the Directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequately and operating e_ectively.
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors of the Company have submitted the Declaration ofIndependence as required pursuant to provisions of section 149 of Companies Act 2013 andunder Listing Regulations stating that they meet the criteria of independence as providedin said section/relevant regulation.
None of the Directors of Company are disqualified under the provisions of section 164of Companies Act 2013 & rules made there under. The Directors have made the requisitedisclosures as required under the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
MATERIAL CHANGES FROM END OF FINANCIAL YEAR TILL DATE OF REPORT
There are no material changes and commitments a_ecting the financial position of theCompany which occurred between the end of the financial year to which this financialstatements relate and the date of this Report.
DISCLOSURE REGARDING VOTING RIGHT NOT EXERCISED DIRECTLY BY THE EMPLOYEES
During the year under review there is NIL disclosure as required under provisions ofsection 67 of Companies Act 2013.
No disclosure or reporting is made in respect of the following items as there were notransactions during the year under review:
No material fraud has been reported by the Auditors to the Audit Committee or theBoard.
Neither there is revision in the Financial Statements nor there is any change in natureof business.
EQUAL OPPORTUNITY EMPLOYER
Company has always provided a congenial atmosphere for work to all employees that isfree from discrimination and harassment including sexual harassment. It has provided equalopportunities to all employees workers without regard to their caste creed colourmarital status and sex.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management discussion and analysis report as required by Listing Regulations formspart of the Annual Report.
The Directors take this opportunity to express their deep sense of gratitude to theCustomers stakeholders Central and State Governments for their continued guidance andsupport. Your Directors wish to place on record their appreciation for the supportdedication and hard work put in by every member of WINSOME Family.
| ||For and on behalf of the Board |
|Place: Chandigarh ||Sd/- |
|Date: 25th May 2018 ||(ASHISH BAGRODIA) |
| ||CHAIRMAN & MANAGING DIRECTOR |
| ||DIN-00047021 |