DIRECTORS' REPORT Dear Members, Your Directors have pleasure in presenting to you the 42nd Annual Report and the Audited Accounts for the Financial Year ended 31st March, 2015 OPERATIONS During the year under report, your Company has registered turnover of Rs.11,174 lacs as compared to Rs.10,462 lacs in the previous financial year. The Company earned a net profit of Rs.2637 lacs as compared to a net profit of Rs.5981 lacs in the previous financial year. The management is confident that with its visionary approach and meticulous planning, the company will be moving the way ahead The turnover of fine blanking components has decreased by 4% to Rs. 1726 Lac and the turnover of Electricals has increased by 33% to Rs. 8,884 Lacs during the current financial year in this competitive market. DIVIDEND To sustain internal accruals for the future growth of the Company, your directors are not recommending any dividend for the Accounting Year. RESERVES The Company do not propose to carry any amount to any reserves. MATERIAL CHANGES AND COMMITMENTS There were no material changes and commitments, affecting the financial position of the Company that have occurred between the end of the financial year of the Company and the date of signing of this report. BOARD OF DIRECTORS At the ensuing Annual General Meeting (AGM), Ms. Aashima Munjal Director retires by rotation and being eligible, offers herself for re-election. The notice convening the ensuing AGM includes the proposal for her re-appointment as director. During the period under review Sh. Harjeet Singh Arora, Director has resigned from the Directorship of the Company. Sh. Mahesh Munjal has been re-appointed as the Managing Director of the Company subject to approval of shareholders in the forthcoming Annual General Meeting. Further Sh. Aayush Munjal has been appointed as Whole Time Director of the Company subject to the approval of the shareholders in the forthcoming Annual General Meeting of the Company. All the independent directors have affirmed that they satisfy the criteria laid down under section 149 of the Companies Act, 2013 and clause 49 of the listing agreement. Board Evaluation: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Appointment & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report. Meetings: A calendar of Meetings is prepared and circulated in advance to the Directors. During the year four Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. KEY MANAGERIAL PERSONNEL During the year under review, the following whole time employees are the Key Managerial Personnel (KMP) of the Company: 1. Sh. Mahesh Munjal, Managing Director 2. Sh. Prakash Patro, Chief Financial Officer 3. Sh. Rajesh Saini, Company Secretary PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. DIRECTORS' RESPONSIBILITY STATEMENT In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that: i) In the preparation of the annual accounts, the applicable accounting standards have been followed. ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review. iii) The directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. iv) The directors have prepared the annual accounts on a going concern basis. v) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. vi) The directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. HOLDING COMPANY The Holding Company, M/s Anadi Investments Private Limited is holding 7,757,687 equity shares in the company of Rs. 10/- each equivalent to 74.61% of the paid up capital of the company as on 31st March 2015. SUBSIDIARY/JOINT VENTURE AND ASSOCIATESCOMPANY(IES) The Company has one Subsidiary namely Majestic IT Services Limited (MITSL), which is engaged in the business of providing a broad range of information and technology related services. MITSL has commenced its operations in the area of NCR Delhi. CONSOLIDATED FINANCIAL STATEMENTS In accordance with the provisions of Companies Act, 2013 and Accounting Standard - 21 on Consolidated Financial Statements read with Accounting Standard - 23 on Accounting for Investments in Associates and Accounting Standard - 27 on Financial Reporting of Interests in Joint Venture in Consolidated Financial Statements, your Directors have the pleasure in attaching the Consolidated Financial Statements which form a part of the Annual Report. LISTING The shares of your Company are listed at BSE Limited, and pursuant to Clause 38 of the Listing Agreement, the Annual Listing fees for the year 2015-16 have been paid to them well before the due date i.e. April 30, 2015. The Company has also paid the annual custodian fees for the year 2015-16 in respect of Shares held in dematerialized mode to NSDL & CDSL. RELATED PARTY TRANSACTIONS: All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. Thus, disclosure in form AOC-2 is not required. The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013, the rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company i.e. www.majesticauto.in CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The detailed information as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 Companies (Accounts) Rules, 2014 is annexed hereto as Annexure-I and forms an integral part of this report. ENVIRONMENTAL & QUALITY MANAGEMENT With implementation of the Environment Management System (EMS) ISO-14001:2004, the Company continues to pursue its endeavor to operate in harmony with the nature, conservation of natural resources and reduction in Global warming. The Company continues to maintain the ISO/TS:16949(2009) Quality Management Systems to ensure effectiveness of all functions. AUDITORS' REPORT/ SECRETARIAL AUDIT REPORT The observation made in the Auditors' Report/Secretarial Audit Report read together with relevant notes thereon are self-explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013. AUDITORS At the Annual General Meeting held on 29th September, 2014 M/s B.D. Bansal and Co., Amritsar were appointed as statutory auditors of the Company to hold office till the conclusion of the 44thAnnual General Meeting. In terms of the first proviso to Section 139 of the Companies Act, 2013 the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s B.D. Bansal and Co., Amritsar as statutory auditors of the Company, is placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that their appointment is in accordance with the provisions of Section 141 of the Companies Act, 2013. The auditors' report on the accounts of the Company for the year under review requires no comments. SECRETARIAL AUDIT M/s Ashok Singla and Associate, Practicing Company Secretaries, Ludhiana, were appointed to conduct the Secretarial Audit of the Company for the financial year 2014-15 under Section 204 of the Companies Act, 2013 and Rules made there under. The Secretarial Audit Report for Financial Year 2014-15 is appended as an Annexure II to the Board's report. The Secretarial auditors' report for the year under review requires no comments. COST AUDIT/ORS Cost audit for the financial year 2014-15 is not applicable to the Company as per Notification No.G.S.R.425[E] dated 30th June2014 issued by the Ministry of Corporate Affairs, hence no cost auditor was appointed for cost audit purposes. However as per notification issued by Ministry of Corporate Affairs for amendment in Companies (Cost Records and Audit) Rules, 2014 dated December 31, 2014, Cost Audit will be applicable to the Company for the financial year 2015-16. Accordingly, the Board of Directors of the Company on the recommendation of the Audit Committee, approved the appointment and remuneration of M/s. Manoj and Associates, Practicing Cost Accountants to conduct the audit of the cost records of the Company across various segments for the financial year ended March 31, 2016. EXTRACT OF ANNUAL RETURN In accordance with Section 134(3)(a) of the Companies Act 2013, an extract of the annual return in the prescribed format is appended as an Annexure III to the Board's report. DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY The Company has been addressing various risks through well-defined risk management policy/procedures, which are in the opinion of the Board may threaten the existence of the Company. INTERNAL FINANCIAL CONTROL SYSTEMS The Company has laid down adequate internal financial controls with reference to financial statements. During the year such controls were tested and no material weakness in their operating effectiveness was observed. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE There were no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company's operations AUDIT COMMITTEE RECOMMENDATION During the year there was no such recommendation of the Audit Committee which was not accepted by the Board. Hence, disclosure of the same is not required in this Report. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM/WHISTLE BLOWER POLICY The Company has adopted the Whistle Blower Policy/Vigil mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud, or violation of the Company's Code of Conduct and Ethics. Such mechanism/policy is also uploaded on the website of the Company i.e. www.majesticauto.in REMUNERATION POLICY The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their Remuneration. The said policy has been uploaded on the website of the Company. The Key provisions of Nomination and Remuneration policy are appended as an Annexure IV to the Board's report. 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 is appended as an Annexure V and forms an integral part of this report. MANAGEMENT DISCUSSION AND ANALYSIS REPORT A report in the form of Management Discussion and Analysis pursuant to Clause 49 of the Listing Agreement, as a part of this report is annexed hereto as Annexure VI. PERSONNEL As on March 31, 2015, the total number of employees on the records of the Company was 607.The Company conducts several training programmes to upgrade the skills of its workforce. These programmes have a strong practical approach, and the objective is to derive tangible improvements. Industrial relations were cordial throughout the year. Your Directors place on record their appreciation for the dedicated and sincere efforts put in by all employees in the performance of the Company. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE The Company has constituted the Corporate Social Responsibility (CSR) Committee on August 14, 2014 comprising Dr. M.A. Zahir as Chairman and Maj. S.S. Khosla and Mr. Mahesh Munjal as other members. The said Committee has been entrusted with the responsibility of formulating and recommending CSR policy indicating the activities to be undertaken by the Company, monitoring and implementation of the framework of CSR policy and recommending the amount to be spent on CSR activities.Annual Report on Corporate Social Responsibility [CSR] activities is appended as an Annexure VII CORPORATE GOVERNANCE Pursuant to Clause 49 of the Listing Agreement with the Bombay Stock Exchange Ltd., adequate steps have been taken to ensure that all the provisions relating to Corporate Governance are duly complied with. A report on Corporate Governance along with the Auditors' Certificate on its compliance as a part of this report is annexed hereto as Annexure VIII ACKNOWLEDGEMENT The Directors acknowledge with gratitude, the co-operation and assistance given by the Central Government, State Governments, Banks, Dealers, Customers, Vendors and Investors during the year under review. For and on Behalf of the Board of Directors (Mahesh Munjal) Chairman & Managing Director Place : Ludhiana Date : 14.08.2015 |