Directors' Report TO, THE MEMBERS OF UNIPHOS ENTERPRISES LIMITED Your Directors have pleasure in presenting their report and audited accounts for the year ended 31st March, 2016. OPERATIONAL PERFORMANCE During the year, there were no sales. Other income was Rs. 1371.26 lacs as compared to Rs. 1060.19 lacs in the previous year. The Company has earned profit of Rs. 1179.52 lacs after tax as compared to profit of Rs. 852.23 lacs in the previous year. FUTURE OUTLOOK The Company continues to look at new opportunities of trading in chemicals in India and abroad. MANAGEMENT DISCUSSION AND ANALYSIS The Management Discussion and Analysis Report forms an integral part of this Report. DIVIDEND Your Directors do not recommend any dividend for the year under review. TRANSFER TO RESERVES No amount is appropriated from Profit and Loss Account and transferred to any Reserve Account. An amount of Rs.2788.34 lacs is proposed to be retained in the statement of Profit and Loss. SHARE CAPITAL The paid up Equity Share Capital as on March 31, 2016 was Rs.1390.92 lacs. i) Issue of Equity Shares with differential rights. Issue of Sweat Equity shares and Issue of Employee Stock Options During the year under review, the Company has not issued any shares with differential voting rights, Issue of Sweat Equity shares and Issue of Employee Stock Options- (ESOS). ii) Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employees The Company has no scheme of provision of money for purchase of its own shares by employees or by trustees for the benefit of employees. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Details of Investments covered under the provisions of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 are given in the notes to the Financial Statements. There are no loans given and there are no guarantees issued by the Company AUDITORS AND AUDITORS' REPORT a) Statutory Auditors The Company's Auditors, Messrs S R B C & CO LLP (ICAI Firm Registration NO.324982E/E300003), Chartered Accountants, Mumbai who retire at the ensuing Annual General Meeting of the Company are eligible for re-appointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for re-appointment as Auditors of the Company. The auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. The notes on financial statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments. b) Secretarial Audit Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs N. L. Bhatia & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as 'Annexure [1] to Board's Report'. The secretarial auditors' report does not contain any qualifications, reservations or adverse remarks. DIRECTORS In accordance with the Provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rajnikant Devidas Shroff (DIN: 00180810), Director of the Company, retires by rotation at the ensuing Annual General Meeting of the Company, and being eligible, offers himself for re-appointment. The information of Director seeking re-appointment as required pursuant to Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is provided in the notice convening the 47th Annual General Meeting of the Company. The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Details of the familiarization programme of the independent directors are available on the website of the Company www. uelonline.com None of the Directors of the Company has incurred any disqualification. Pursuant to the provisions of the Companies Act, 2013, and Regulation 25(4)(a) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, annual performance evaluation was carried out of the performance of the Board and the directors individually. Various parameters were considered for evaluation and after receiving the inputs from the Directors, the performance evaluation exercise was carried out. The parameters included integrity, credibility, expertise and trustworthiness of directors, Board's monitoring of various compliances, laying down and effective implementation of various policies, level of engagement and contribution of the directors, safeguarding the interest of all stakeholders etc. During the year under review, all the Independent Directors met on 28th January, 2016 to discuss evaluation of the performance of Non Independent Directors and the Board of Directors as a whole, evaluation of the performance of Chairman of the Company, taking into account the views of the Directors and evaluation of the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties. The performance of evaluation of each Independent Director was carried out by the Board. The Directors expressed their satisfaction with the evaluation process. REMUNERATION POLICY The Board has, on the recommendation of the Nomination and Remuneration Committee, framed and adopted the policy for selection and appointment of Directors, Senior management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report which forms part of this Report. The policy lays down criteria for selection of directors and senior management such as expertise, experience and integrity of the directors, independent nature of the directors, personal and professional standing, diversity of the Board, etc. At present no Director of the Company receives any remuneration from the Company except payment of sitting fess to some of the Independent Directors for attending the Board and Committee meetings. The Senior management employees are working for the Company on deputation basis. FAMILIARIZATION PROGRAMME FOR THE INDEPENDENT DIRECTORS: Pursuant to the SEBI regulations, the Company has worked out a Familiarization programme for the Independent Directors, with a view to familiarize them with their role, rights and responsibilities in the Company, nature of Industry in which the Company operates, business model of the Company, etc. Through the Familiarization programme, the Company apprises the independent directors about the financial performance, internal control system, statutory compliances and corporate governance practices. At the time of appointment of independent director, a formal letter of appointment is given which explains role, responsibility and rights in the Company. Details of Familiarization programme of Independent Directors with the Company are available on the website of the Company www.uelonline.com. NUMBER OF MEETINGS OF THE BOARD AND AUDIT COMMITTEE The details of the number of Board and Audit Committee meetings of the Company are set out in the Corporate Governance Report which forms part of this Report. COMPOSITION OF AUDIT COMMITTEE Pursuant to the provisions of section 177 of the Companies Act, 2013, the Company has constituted an Audit Committee consist of three Independent Directors. The details of the composition of the Audit Committee is provided in the Corporate Governance Report which forms part of this Report. There are no recommendation of the Audit Committee which are not accepted by the Board. KEY MANAGERIAL PERSONNEL Mr. Rajnikant Devidas Shroff (DIN 00180810), Chairman and Managing Director, Mr. K. M. Thacker (Membership No. ACS 6843), Company Secretary and Mr. Bipin P. Chheda, Chief Financial Officer are the Key Managerial Personnel of your Company in accordance with the provisions of Sections 2(51), 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES As none of the Directors of your Company receives remuneration from the Company and the Senior management employees are working for the Company on deputation basis, the information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, in respect of Directors/ employees of your Company is not given. The Company has no employee who- (i) if employed throughout the financial year, was in receipt of remuneration, in aggregate, more than Rs.60 lacs, or (ii) if employed for a part of the financial year, was in receipt of remuneration, in aggregate, more than lacs per month. Hence, the information required to be given pursuant to the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, is not applicable and hence not attached. RELATED PARTY TRANSACTIONS There were no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. The same can be accessed on www.uelonline.com/investors. Since there were no materially significant related party transactions entered into during the year, the Form AOC- 2 pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not attached to this Report. VIGIL MECHANISM / WHISTLEBLOWER POLICY The Company has formed whistleblower policy to deal with any fraud, irregularity or mismanagement in the Company. The policy enables any employee or director to directly communicate to the Chairman of the Audit Committee to report any fraud, irregularity or mismanagement in the Company. The policy ensures strict confidentiality while dealing with concerns and also that no discrimination or victimization is meted out to any whistleblower. The policy is also posted on the website of the Company www. uelonline.com INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY The Company has an internal control system, commensurate with the size, scale and complexity of its operation. The Group has an inhouse internal audit team headed by a qualified professional, which undertakes internal audit and ensures that all transactions are authorized and recorded in the books of the Company. The internal audit department monitors the efficacy and adequacy of internal control. Significant audit observations, if any, are presented to the Audit Committee and action taken to correct any deficiency is informed to them. The report prepared by internal audit team forms the basis of utilization by the Managing Director and Chief Financial Officer for financial reporting as required under Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Internal Controls over Financial Reporting: The Company has adequate internal financial controls in place, commensurate with the size, scale and complexity of its operations. The Company is complying with all the applicable Accounting Standards. The accounting records are maintained in accordance with generally accepted accounting principles in India. This ensures that the financial statements reflect true and fair financial position of the Company. RISK MANAGEMENT FRAMEWORK Pursuant to SEBI Listing Regulations, the Company has prepared Risk Management Framework for identifying and evaluating various major business risks faced by the Company. Risk Management Framework aims to lay down the procedure for risk assessment and risk minimization. Risk Management Framework is prepared to ensure internal controls and effectively respond to any changes in the business environment so as to achieve high degree of business performance, limit any negative impact on its working and avail of benefits arising out of any business opportunities. There are standard practices in place to ensure that strong financial controls are in place. The audit committee has additional oversight in the area of financial risks and controls. Key business risks perceived by the Company and mitigating initiatives are as under: -Funding risk: As there are no much activities in the Company, the Company may not be able to mobilize adequate funds, if any, in time. The mitigating factors are that the Company has good investment in the quoted shares, so raising additional funds, if any, will not be difficult for the Company. -Regulatory risk: Any change in Government / Regulators Policy / Rules / Regulations will require fresh compliances. The mitigating factors are that the group has very strong and dedicated team consisting of professionals to study regulatory changes and fresh requirement. -Foreign currency fluctuation risk:- The Company is engaged in the trading activities, which may subject to risk of less profit / loss on account of volatility in foreign currency exchange. The mitigating factors are that the management ensures to enter in trading transactions in such a way that there are minimal risks of volatility in foreign currency exchange or the Company may take adequate forward cover for foreign exchange fluctuations. DEPOSITORY SYSTEM 99.02 % of the total paid up equity shares of the Company are dematerialised as on 31st March, 2016. INFORMATION REGARDING CONSERVATION OF ENERGY ETC. The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under sections 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014, for the year 31st March, 2016 is furnished here below. I. CONSERVATION OF ENERGY - Not Applicable II. TECHNOLOGY ABSORPTION - Not Applicable III. FOREIGN EXCHANGE EARNING AND OUTGO Rs. in Lacs (a) Foreign Exchange earned :- (b) Foreign Exchange outgo :2.72 DIRECTORS RESPONSIBILITY To the best of their knowledge and belief and according to the information and explanations obtained by them, the directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013: a) That in the preparation of the annual financial statements for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any. b) That such accounting policies as mentioned in Note 2.1 of the Notes to the Financial Statements have been selected and applied consistently and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date. c) That proper and sufficient care has been taken for themaintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. d) That the annual financial statements have been prepared on a going concern basis. e) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. f) That systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. CORPORATE GOVERNANCE Your Company and its Board has been complying with Corporate Governance to the extent set out in this respect as a separate report, in pursuance of requirement of Clause 49 of the Listing Agreement with the Stock Exchanges where the equity shares of the Company are listed or SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as applicable. A Certificate from Auditors regarding compliance of the conditions of Corporate Governance as stipulated under para E of Schedule V SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached and forms integral part of this Report. DEALING WITH SECURITIES WHICH HAVE REMAINED UNCLAIMED Members are hereby informed that as per Regulation 39(4) read with Schedule VI of the SEBI Regulations, the Company is in the process of sending reminders to those Members whose share certificates have remained unclaimed, to contact the Company immediately in the matter. The Company, after following the prescribed procedure will dematerialize unclaimed shares which are retained with the Company. These shares would be held by the Company on behalf of the holders of such shares in an "Unclaimed Suspense Account" to be opened with a depository. At the end of seven years, hereof, these shares shall be transferred by the Company to the IEPF. Dividends remaining unclaimed in respect of such shares shall also be held in a separate suspense account and would likewise be transferred to IEPF at the end of seven years. Members may note that the lawful claimant in respect of these shares / dividend will be able to claim such shares dividend from the Company till such time they remain in the unclaimed suspense account as aforesaid. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT-9, in accordance with Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, are set out and annexed herewith as 'Annexure [2] to Board's Report'. LISTING OF THE COMPANY'S EQUITY SHARES / GDR The Equity Shares of your Company continue to be listed at the BSE Ltd. and National Stock Exchange of India Ltd. The GDR continue to be listed at the Luxembourg Stock Exchange. There is no default in paying annual listing fees. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations. GENERAL No disclosure or reporting is required in respect of the following points as there were no transactions on these items or were not applicable to your Company during the year under review. a) The Company has no subsidiary as on 31st March, 2016; b) The Company has not accepted any deposits from public. c) Details about the policy developed and implemented by the Company on corporate social responsibility initiatives taken during the year. d) Disclosure as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ACKNOWLEDGEMENT Your Directors are thankful to all the stakeholders and various government agencies and ministries for their continued support. By Order of the Board of Directors For UNIPHOS ENTERPRISES LIMITED Rajnikant Devidas Shroff Chairman & Managing Director Registered Office: 11, G.I.D.C., Vapi, Dist. Valsad, Gujarat, Pin- 396 195. CIN: L24219GJ1969PLC001588 (DIN: 00180810) Mumbai 29th April, 2016 |