BOARD'S REPORT To The Members of SHREE RAMA NEWSPRINT LIMITED Your Directors are pleased to present the 24th Annual Report and the Audited Accounts for the Financial Year ended 31st March 2015. Performance: During the year under review, the Company produced only Newsprint variety on its machines. The Indian Newsprint Manufacturing Industry which has an installed capacity of about 2.5 million MTS per annum, could operate at 50% of the capacity with a production of 1.24 million MTS, whereas the imports were of the order of about 1.4 million MTS. In this background, the capacity utilization of the Company stood at 84% during the year 2014-15 as against 94% during the year 2013-14. The average selling price of Newsprint continued to decline during the year due to cheaper imports mainly from Russia, Korea, Europe, USA & Canada. The decline in selling price was so steep that it eroded the profit margins and even EBIDTA went into negative territory. The Company is focusing on improving the operating efficiencies of the plant and reduce both the fixed and variable cost in order to arrest the erosion in profitability and is hopeful of improving its performance during 2015-16. DIVIDEND: Due to the Loss incurred by Company during the year under review, the directors are not able to recommend dividend for the year 2014-15. TRANSFER TO RESERVES: In view of losses, the Company has not proposed to transfer any amount to any reserves of the Company. FIXED DEPOSIT: Company has not accepted or renewed any deposit during the year. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES: The Company does not have any subsidiary or associate company within the meaning of Section 2(6) of the Companies Act, 2013. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure I". PARTICULARS OF LOANS, GUARANTEES INVESTMENTS UNDER SECTION 186: OR The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES: The details of related party disclosures and transactions as prescribed in Form AOC-2 is attached as Annexure V. All the transaction are done at arms length and pertain to F.Y. 2014-15 period only and as approved in the Board and Audit Committee Meetings held during the F.Y. 2014-15. NUMBER OF MEETINGS OF THE BOARD During the year, four Board Meetings were convened and held on 13th May, 2014, 9th August, 2014, 28th October, 2014 and 2nd February, 2015. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL: The Board of Directors appointed Mr. Ganpatraj Chowdhary and Mr. Siddharth Chowdhary as an Additional Director w.e.f. 23.06.2015 who will hold their positions till the date of the ensuing Annual General Meeting. The Board of Directors also appointed Mr. Keerthinarayanan A. Hemmige and Mr. Murli Ranganathan as Additional Independent Director w.e.f. 23.06.2015 who will hold their positions till the date of the ensuing Annual General Meeting. The Company has received notices u/s 160 of the Companies Act, 2013, proposing the candidature of Mr. Ganpatraj Chowdhary and Mr. Siddharth Chowdhary for appointment of directors at the ensuing Annual General Meeting. The Board of Directors of the Company also took note of the resignation of Mr. Girish Sharma Sr. Vice President (F&A) and Company Secretary w.e.f 25.06.2015 DIRECTORS' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 134(3)(c) OF THE COMPANIES ACT, 2013: The Directors hereby confirm that:- 1. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; 2. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are 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 and loss of thecompany for that period; 3. the directors had 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; 4. the directors had prepared the annual accounts on a going concern basis; 5. the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and 6. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS: Pursuant to Section 149(6) of the Companies Act, 2013, Independent Directors of the Company have made a declaration confirming the compliance of the conditions of the independence stipulated in the aforesaid section. DETAILS OF COMMITTEE OF DIRECTORS: Composition of Audit Committee of Directors, Nomination and Remuneration Committee of Directors and Stake Holders Relationship/ Grievances Committee of Directors, number of meetings held of each Committee during the financial year 201415 and meetings attended by each member of the Committee as required under the Companies Act, 2013 are provided in Corporate Governance Report. ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEES AND INDIVIDUAL DIRECTORS: The Board of Directors of the Company has initiated and put in place evaluation of its own performance, its Committees and individuals. The result of the evaluation is satisfactory and adequate and meets the requirements. INTERNAL CONTROL SYSTEMS: The Company has an adequate system of internal control procedures which is commensurate with the size and nature of business. Detailed procedural manuals are in place to ensure that all the assets are safeguarded, protected against loss and all transactions are authorised, recorded and reported correctly. The internal control systems of the Company are monitored and evaluated by internal auditors and their audit reports are periodically reviewed by the Audit Committee of the Board of Directors. APPOINTMENT AND REMUNERATION POLICY: The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration which is available on Company's website at www. ramanewsprint.com WHISTLE BLOWER POLICY: The Company has formulated a Whistle Blower Policy to establish a vigil mechanism for Directors, Employees and other Stakeholders of the Company to report concerns about illegal and unethical practices, unethical behavior, actual or suspected fraud or violation of the Company's Code of Conduct or Ethics Policy which is available at the Company's website at www. ramanewsprint.com RISK MANAGEMENT: During the year, the Management of the Company had evaluated the existing Risk Management Policy of the Company. The Risk Management policy has been reviewed and found adequate and sufficient to the requirement of the Company. The Management has evaluated various risk and that there is no element of risk identified that may threaten the existence of the Company. LISTING OF SHARES Equity Shares of Company continue to be listed on Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The Company has duly paid listing fees to the stock exchanges. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO Particulars with respect to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required u/s 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 are furnished as Annexure - II to this Report and forms part of it. CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION & ANALYSIS Report on Corporate Governance and Management Discussion and Analysis is made part of this Annual Report. As required by the Listing Agreements, the Certificate of Auditors on Corporate Governance compliance is also annexed to this Annual Report. The Certificate from CEO/CFO was placed before the Board of Directors at its meeting held on 27.05.2015. PARTICULARS OF EMPLOYEES The information required under section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as per Annexure - III SECRETARIAL AUDIT Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board on the recommendations of the Audit Committee, has appointed M/s. Ajay Kumar & Co., a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the Financial Year ended 31st March, 2015. Secretarial Audit Report issued by M/s. Ajay Kumar & Co., Company Secretaries, in form MR-3 forms part of this report and marked as "Annexure- IV" CASH FLOW STATEMENT As required under clause 32 of the listing agreement with the Stock Exchanges, the Cash Flow Statement is attached to the Balance Sheet. AUDITORS The present Auditors of your Company, M/s. Haribhakti & Co. LLP, Chartered Accountants hold office until the conclusion of this Annual General Meeting and being eligible, offer themselves for re-appointment. EXPLANATIONS / COMMENTS BY THE BOARD ON QUALIFICATIONS, RESERVATION OR ADVERSE REMARKS OR DISCLAIMER MADE BY THE AUDITOR / COMPANY SECRETARY IN PRACTICE IN THEIR REPORT: The Board has taken note of the qualification made by the Auditors in their report regarding the Company having recognized Deferred Tax Asset (DTA) in the absence of convincing evidences to support virtual certainty about the future taxable income. However, as explained in the notes to Accounts the Board is of a strong opinion that in view of the improved market scenario and the infusion of fresh funds, the Company will have sufficient future taxable profits. The other observations of the Auditors in their report read with the relevant notes are self explanatory. CORPORATE SOCIAL RESPONSIBILITY (CSR) The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY In terms of Section 134(3)(i) of the Companies Act, 2013, it is reported that, except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company's financial position have occurred between the end of the financial year of the Company and date of this report SIGNIFICANT AND MATERIAL ORDERS There are no material orders passed by Regulators, Courts or Tribunals impacting the going concern status and company's operations in future. INDUSTRIAL RELATIONS The industrial relations remained cordial throughout the year under review. ACKNOWLEDGEMENT The Directors wish to place on record and acknowledge their appreciation and gratitude for the continued co-operation and support received from the Central Government, the State Government of Gujarat, Regulatory Bodies, participating Financial Institutions and Banks, Customers, Suppliers and Dealers. The Directors take this opportunity to express their appreciation towards the dedication, commitment and teamwork shown by employees, which has contributed in taking the Company on the path of prosperity. Your Directors further thank the fraternity of Members/Shareholders for their continued confidence reposed in the management of the Company. For and on behalf of the Board S. K. Bangur Chairman Place: Mumbai Date: 11.08.2015 |