BOARD'S REPORT TO, THE MEMBERS Your Directors have pleasure in presenting their 38th Annual Report on the business and operations of the Company and the accounts for the financial year ended 31st March, 2015. 2. TRANSFER TO RESERVES Your Directors propose to transfer Rs. 40.00 Lacs to the General Reserve out of the current year's profit and the Balance aggregating to Rs. 774.20 Lacs is proposed to be retained in the Profit & Loss Account. 3. DIVIDEND After considering earnings, requirement for funds and with the objective of rewarding the shareholders, your Directors recommend a dividend of Rs.1.20 (12%) per equity share for the year 2014-15 (Previous year Rs.1.20 per equity share i.e.12%), subject to the approval of shareholders. If approved, the dividend will absorb Rs.77.58 Lacs, including Corporate Dividend Tax, Surcharge and Education Cess. 4. REVIEW OF BUSINESS OPERATIONS AND PROSPECTS BUSINESS OPERATIONS Overall market conditions directly impacting the product groups manufactured by Your Company in 2014-15 remained significantly the same ie., weak as in the previous year. In the result both, sales turnover and margins were constantly under pressure owing to heightened competition. In this background Your Company could manage to close the year 2014-15 at nearly the same profitability level as in the previous year. PROSPECTS : The First Quarter of the current year 2015-16, has not shown any improvement in demand and price realization scenario. However, a noteworthy positive factor recently has been the significant softening of principal raw material prices. Your Company has drawn investment plans to enter into value added products like Indexable Inserts / Cutting Tools and thereby insulate itself against volatile raw material price movements by significant reduction in the percentage of raw material content in the final product. 5. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY. The Company has an extensive system of internal controls to ensure optimal utilisation of resources and accurate reporting of financial transactions and strict compliance with applicable laws and regulations. The Company has put in place sufficient system to ensure that assets are safe guarded against loss from unauthorised used or disposition, and that transactions are authorised, recorded and reported correctly. 6. SAFETY AND HEALTH The health and safety of the employees across its operations remains the highest priority for the Company. All endeavours are being taken to enhance safety standards and processes towards minimising safety risks in all operations in the Company. 7. GREEN INITIATIVES The Company has started transmitting Annual Report through electronic mode-email to the shareholders who preferred to receive Annual Report through electronic mode and initiated steps to reduce consumption of paper. 8. HUMAN RESOURCES Humans are considered as one of the most critical resources in the business which can be continuously smoothened to maximize the effectiveness of the Organization. Human resources build the Enterprise and the sense of belonging would inculcate the spirit of dedication and loyalty amongst them towards strengthening the Company's Polices and Systems. All personnel continue to have healthy, cordial and harmonious approach thereby enhancing the contributory value of the Company. 9. LISTING The Equity Shares of the Company are listed at BSE Limited (BSE). The Company has made all the compliances of Listing Agreement including payment of Annual Listing Fees up to 31st March, 2016 to BSE Limited. 10. CORPORATE GOVERNANCE & REPORT THEREON The Company has complied with the various requirements under the Corporate Governance reporting system. A detailed Compliance Report on Corporate Governance is annexed to this report. The certificate on compliance with the conditions of Corporate Governance under clause 49 of the Listing Agreement is also annexed to this report. Provisions of Clause 49 of the Listing Agreement were applicable to the Company only up to 30th September, 2014 and it became non applicable with effect from 01st October, 2014 as the Company's paid up share capital is less than Rs. 10 crores and net worth less than Rs. 25 crores. 11. SPECIAL BUSINESS As regards the items of the Notice of the AGM relating to Special Business, the resolutions incorporated in the Notice and the Explanatory Statement relating thereto, fully indicate the reasons for seeking the approvals of members to those proposals. Your attention is drawn to these items and Explanatory Statement annexed to the Notice. 12. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT. 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. 13. PARTICULARS IN RESPECT OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO, AS REQUIRED TO BE DISCLOSED BY THE COMPANIES (ACCOUNTS) RULES, 2014 AND FORMING A PART OF THE DIRECTORS' REPORT ARE AS UNDER: - (A) Conservation of energy The Company accords great importance to conservation of energy. The main focus of the Company during the year was: (i) Energy Conservation measures taken:- 1. Close monitoring of consumption of electricity, LPG, Diesel and water. 2. Optimum use of Energy by Switching off Machines, Lights, Fans, Air Conditioners and Exhaust Systems whenever not required. 3. Creating awareness among Workmen to conserve energy. (ii) Impact of measures of (a) above for reduction of energy consumption and consequent impact on the cost of production of goods: 1. Due to measures taken as described above, the overall power and fuel oil consumption at plants and office has reduced. However the cost of production on account of power has increased due to increase in cost per unit. (iii) Total energy consumption and energy consumption per unit of production Form for disclosure of particulars with respect to Technology Absorption, Research and Development FOCUS ON RESEARCH AND DEVELOPMENT: • Improvement in productivity/quality and reduction in cost of production of Company's Plants and at Customer's end. • Cost reduction, import substitution, safer environment and strategic resource management. • Meeting the statutory requirements. (B) Technology Absorption, Adaptation and Innovation The Management has focused on productivity and Total Quality Management [TQM] in order to optimize manufacturing costs. (C) Benefits This has helped in achieving optimum manufacturing costs, improved quality of products and consequently, enhanced customer satisfaction. The Company uses indigenous technology. (D) The Company has not imported any technology during the year under review. (E) Foreign Exchange Earnings and Outgo • Activities relating to exports, initiatives taken to increase exports, development of new export markets for products and services and export plans: • Company is focused to increase its exports to Turkey, South Africa, Canada and we expect exports and global sales to continue to grow. 14. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY. The Company has the risk assessment and mitigation procedure in place and the Board has been kept informed of such assessment. 15. CORPORATE SOCIAL RESPONSIBILITY The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure-A of this Report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The Policy is available on the Web-Site of the Company. 16. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013. There was no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable. 17. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES. The particulars of Contracts or Arrangements made with related parties made pursuant to Section 188 is furnished in Annexure B and is attached to this report. 18. COMPANY'S POLICY RELATING TO APPOINTMENT OF DIRECTORS AND KEY MANAGERIAL PERSONNEL, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES. The Company's Policy relating to appointment of Directors and Key Managerial Personnel, payment of Managerial remuneration, Directors' qualifications, positive attributes, and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure C and is attached to this report. 19. ANNUAL RETURN The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure D and is attached to this Report. 21. DIRECTORS RESPONSIBILITY STATEMENT In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submit its responsibility Statement:- a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) the directors had selected such accounting policies and applied them consistently and made j udgments 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 the company for that period; (c) 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; (d) the directors had prepared the annual accounts on a going concern basis; and (e) 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. (f) 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. 22. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES The Company does not have any Subsidiary, Joint venture or Associate Company. 23. DEPOSITS As per Section 74 of the Companies Act, 2013 all the fixed deposits which were due for repayment on or after 31st March, 2015 have been repaid on 31st March, 2015. The Company has neither accepted nor renewed any deposits during the year under review. 24. DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors In accordance with the provisions of the Companies Act 2013, Shri.C.J.Bhatia is due to retire at the conclusion of the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. Smt. Gayatri Parikh who was appointed as Additional Director-Independent on 7th February, 2015 and holds the said office till the date of the Annual General Meeting. A notice has been received from a member proposing her candidature for her re-appointment. Key Managerial Personnel Shri. Kamlesh Shinde, Company Secretary of the Company was appointed as Key Managerial Personnel at the Board Meeting held on 29th May, 2014. Shri. A R Master, Assistant Vice President- Finance of the Company was designated as Key Managerial Personnel at the Board Meeting held on 29th May, 2014. 25. DECLARATION OF INDEPENDENT DIRECTORS The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. BOARD EVALUATION The Board of Directors have carried out an Annual Evaluation of its own performance and individual Directors pursuant to provisions of the Act and Corporate Governance requirements as prescribed by clause 49 of the Listing Agreement. The performance of the Board was evaluated by the Board after seeking inputs from all the Directors on basis of the criteria such as the Board Composition and Structure, Effectiveness of Board Process, Information and Functioning etc. In a separate Meeting of the Independent Directors, performance of Non-Independent Directors, Performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of Executive Directors and Non-Executive Directors. 26. AUDITORS & AUDITORS REPORTS Statutory Auditors M/s D N Shukla & Co., Chartered Accountants, Mumbai were appointed as Statutory Auditors for a period of three (3) years in the Annual General Meeting held on 20th September, 2014. As per the provision of Section 139(1) of the Act, their appointment for the above tenure is subject to ratification by Members at every AGM. Accordingly, ratification of the Members is being sought for proposal contained in the Resolution set out at item No. 4 of the Notice. The Statutory Auditors Report does not contain any qualification, reservation or adverse remark. Cost Auditors The provisions of the Cost Audit are not applicable to the Company and hence the Company is not required to appoint Cost Auditor. Secretarial Auditors M/s Samdani Shah & Associates, Practicing Company Secretaries, Vadodara carried out Secretarial Audit for the year under review. There was no qualifications, reservations or adverse remarks made by the Secretarial Auditors in their report. Secretarial Audit Report is furnished and attached to this report. 27. DISCLOSURE OF COMPOSITION OF AUDIT COMMITTEE AND PROVIDING VIGIL MECHANISM. The Audit Committee consists of the following members a. Shri. Bhumitra V Dholakia- Chairman. b. Shri. Dhananjay D Kanitkar- Member. c. Shri. Jagdish C Bhatia- Member. The above composition of the Audit Committee consists of Independent Directors viz., Mr Bhumitra V Dholakia and Mr Dhananjay D Kanitkar who form the majority. The Company has established a vigil mechanism. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co-employees and the Company 29. GENERAL DISCLOSURES Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: 1. Details relating to deposits covered under Chapter V of the Act. 2. Issue of Equity Shares with differential rights as to dividend, voting or otherwise. 3. Issue of Shares (including Sweat Equity Shares) to employees of the Company under any scheme. 4. The Company has not resorted to any Buy Back of its shares during the year under review. 5. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries. 6. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future. 7. The Company is not required to submit Business Responsibility Report in pursuance of clause 55 of the Listing Agreement. 30. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013. The Company has set up an Internal Complaints Committee (ICC) for providing a Redressal Mechanism pertaining to Sexual Harassment of Women employees at workplace. There was no complaint received during the year under review. 31. NOMINATION AND REMUNERATION COMMITTEE AND STAKE HOLDERS RELATIONSHIP COMMITTEE The Company have duly constituted Nomination and Remuneration Committee and Stake Holders Relationship Committee. The details of Nomination and Remuneration Committee meeting held during the year 2014-15 32. ACKNOWLEDGEMENT Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company. For and on behalf of the Board (Director) (Managing Director) Place : Mumbai Date : 11th August, 2015 |