DIRECTORS' REPORT To The Members, Associated Stone Industries (Kotah) Limited The Directors have pleasure in presenting the 69th Annual Report together with the Audited Financial Statements of the Company for the year ended 31st March, 2015: DIVIDEND Your Directors are pleased to recommend a dividend of Rs. 1.50 (equivalent to 30%) per equity share (previous year Rs. 1.25 i.e equivalent to 25%) of the face value of Rs. 5/- each. RESERVES Your Directors propose to transfer Rs. 200.00 lacs to the General Reserve Account. An amount of Rs 7056.26 lacs is proposed to be retained in the Statement of Profit & Loss. PERFORMANCE For the year under review, the production of Kotah Stone was 1172.77 lacs sq.ft. as against 1205.76 lacs sq. ft. in the previous year and sales were 1201.24 lacs sq.ft. as against 1262.93 lacs sq. ft. in the previous year. During the year under review, the Company has registered total revenue from operations of Rs. 20878.29 lacs (previous year Rs. 13073.62 lacs) and Gross Profit of Rs. 4352.37 lacs (previous year Rs. 2922.99 lacs). This included revenue from the trading activity which during the year under review was Rs. 9158.71 lacs as against Rs. 2034.28 lacs in the previous year. The profit before taxation during the year under review was Rs. 3143.45 lacs as compared to Rs. 1553.44 lacs during the previous year. WIND POWER PROJECT As a part of its efforts to augment "Green Power", the Company continues to operate at its installed 4.75 MW capacity Wind Power plant comprising of 1.125 MW capacity at Tiruppur District of Tamil Nadu, 1.125 MW capacity at Gadag District of Karnataka and 2.50 MW capacity at Satara District of Maharashtra supplying to Electricity Boards. The Wind Power generations basically depends on flow of winds and due to unpredictable climatic conditions generation of power varies from time to time. The generation during the year under review was lower as compared to previous year on account of low wind throughout the year. SUBSIDIARY COMPANY During the year under review the Company has set up an overseas wholly owned subsidiary in the name of ASI Global Limited, in Mauritius to acquire lime stone mine/crusher Company Viz: Al Rawasi Rock & Aggregate LLC in Fujairah UAE. The Company along with ASI Global Limited has acquired the said Company. Your directors draw attention to the members to the Note No. 45 to the consolidated financial statement which set out salient features of Financial Statement of Subsidiary Companies pursuant to provisions of Section 129 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014. CONSOLIDATED FINANCIAL STATEMENTS Consolidated Financial Statements have been prepared by the Company's Management in accordance with the requirements of Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India and as per the provisions of the Companies Act, 2013. The Audited Consolidated Financial Statement is provided in the Annual report. DIRECTORS' RESPONSIBILITY STATEMENT As stipulated in Section 134 of the Companies Act, 2013, your Directors subscribe to the "Directors Responsibility Statement" and the Board of Directors of the Company confirm that: • in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; • the Directors have selected such accounting policies and applied them consistently and made judgements 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 or loss of the Company for that period; • the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; • the Directors have prepared annual accounts on a going concern basis; • the Directors have laid down internal financial control to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and • the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. CORPORATE GOVERNANCE The Company has complied with mandatory provisions of Corporate Governance as prescribed under the Listing Agreement. A separate report on Corporate Governance is attached as a part of the Annual Report along with Auditors' Certificate on its compliance. RELATED PARTY TRANSACTIONS All contracts/ arrangements/ transactions entered by the Company during the year under review with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transaction. The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website. (www.asistone.com <http://www.asistone.com>) Your Directors draw attention of the members to Note No. 40 to the financial statement which set out related party disclosures. CORPORATE SOCIAL RESPONSIBILITY (CSR) As per provisions of Section 135 read with Schedule VII of the Companies Act, 2013, the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Company's CSR Policy in respect of Corporate Social Responsibility activity, a separate statement is attached as Annexure "A" to this Report. The Company has made a budget of Rs 37.00 lacs as against requirement of Rs. 32.57 lacs. During the year under review, CSR expenditure was short by Rs. 7.57 lacs i.e mainly on account of pending of proposal for transfer of bus having WDV of Rs. 9.25 lacs to the Government College which has been running for providing transport facility to Girls Student of Government College. The matter is still under consideration of Education Department, Rajasthan. RISK MANAGEMENT Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your Company periodically assesses risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatments plans in its strategy , business and operational plans. Your Company, through its risk management process, strive to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors. As per requirements of Clause 49 of the Listing Agreement , your Company has constituted a Risk Management Committee to oversee the risk management efforts of the Company under the Chairmanship of Shri. Pramod G. Lath, Independent Director. The details of the Committee along with its charter are set out in the Corporate Governance Report forming part of this Report. During the year under review, the Board of Directors have approved the Risk Management Policy as recommended by the Risk Management Committee. There are no risks which in the opinion of the Board threaten the existence of your Company. However, some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this Report. INTERNAL CONTROL SYSTEM AND ITS ADEQUACY Your Company has an effective internal control and risk mitigation system, which are constantly assessed and strengthened with new/revise standard operating procedure. The Company's internal control system commensurate with its size, scale and complexities of its operations. DIRECTORS AND KEY MANAGERIAL PERSONNEL Number of Meeting of Board Four meetings of the Board of Directors were held during the year under review. For further details please refer the Corporate Governance Report. During the year under review, Shri. Padam Kumar Poddar resigned from the Directorship w.e.f 05.08.2014. The Board has placed on record its appreciation for the services rendered by Shri. Padam Kumar Poddar during his tenure as a Director. The Board of Directors at their meeting held on 05th August, 2014 appointed Smt. Anita Jatia as woman director of the Company. In accordance with the provisions of Section 152 of the Companies Act, 2013 and Company's Articles of Association, Smt. Anita Jatia, Director retires by rotation at the forth coming Annual General Meeting and being eligible, offers herself for reappointment. During the year under review, the Company has appointed Shri. Sanjay Seksaria, Shri. Pramod G. Lath and Shri. Anshul M. Sonawala as independent directors of the Company w.e.f 5th August, 2014 for a period of 5 consecutive years ending on 31st March, 2019. Statement on declaration given by Independent Directors The Independent directors have submitted the declaration of independence, as required pursuant Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence provided in sub- section(6). Board Evaluation Pursuant to the provisions of the Companies Act, 2013, and Clause 49 of the Listing Agreement, a structured questionnaire was prepared after taking into consideration of the various aspect of the Board's functioning, composition of the Boards and its Committees, culture, execution and performance of specific duties and obligation and governance. The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and non Independent Directors was carried by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process. AUDITORS AND AUDITOR'S REPORT Statutory Auditors M/s. B.L. Ajmera & Co., Chartered Accountants, Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. M/s. B.L. Ajmera & Co., have issued Auditors Report for the financial year ended 31st March, 2015 and there is no qualifications in Auditors Report. The Company has received letter from M/s. B.L. Ajmera & Co., to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013 and that they are not disqualified for re-appointment. Secretarial Audit Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s. GMJ & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure "B" and forms an integral part of this Report. There are no secretarial audit qualifications for the year under review. Cost Audit Pursuant to the provisions of Section 141(3) of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s. N.D. Birla & Co, a firm of Cost Accountants in Practice to undertake the Cost Audit of Cost Accounting records of the Company for the financial year ended 31st March, 2015. DISCLOSURES Audit Committee The Audit Committee comprises of Independent Directors namely Shri. Pramod G. Lath (Chairman), Shri. Anshul M. Sonawala and Shri. Sanjay Seksaria as other members. All the recommendations made by the Audit Committee were accepted by the Board. Nomination and Remuneration Committee and its policy Nomination and Remuneration Committee consists of following directors namely Shri. Sanjay Seksaria, Chairman and Shri. Pramod G. Lath and Shri. Anshul M. Sonawala as members of the Committee. Details of the policy and meeting held are given in Corporate Governance Report. Whistle Blower Policy/Vigil Mechanism The Company has a Whistle Blower Policy to report genuine concern and grievances. The policy has been posted on the web site of the Company. Particulars of Loans, Guarantee or Investment by the Company During the year under review the Company has not provided any guarantee or security to any party. Particulars of loans given, investment made along with purpose for which loan or investment made are provided in the financial statement (please refer Note No.10 (b), 16 and 40 to the financial statement). Extract of Annual return The extract of the Annual Return in Form No. MGT-9 as required under Section 92 of the Companies Act, 2013 is attached as Annexure "C" to this Report. Conservation of Energy, Technology absorption and Foreign Exchange Earning and Outgo As per provisions of Section 134 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 statement in respect of Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo is attached as Annexure" D" to this Report. Employees/Managerial Remuneration related disclosures The Company had no employees during the financial year under review or part thereof having receipt of remuneration not less than Rs 5.00 lacs per month. Your directors draw attention to the members to the Note No. 40 to the financial statement which set out disclosure of remuneration to the Managing Director and Executive Director. GENERAL 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: Public Deposit Details relating to deposits covered under Chapter V of the Companies Act, 2013. The Company has discontinued acceptance/renewal of fixed deposits from the public with effect from 1st April, 2014 and all amount outstanding as on 31st March, 2014 were repaid during the year under review and unclaimed amount as on 31st March, 2015, if any, has been transferred to unclaimed deposit account. Share Capital Issue of equity shares with differential rights as to dividend, voting or otherwise. ESOS/Sweat Equity Issue of shares (including sweat equity shares) to employees of the Company under any scheme. Significant and material orders passed by the Regulators or Court 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. Your Directors further state that during the year under review, there were no cases filed pursuant to Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013. ACKNOWLEDGEMENT Your Directors would like to acknowledge and place on record their sincere appreciation to all stakeholders, clients, Financial Institutions, Banks, Central and State Governments, the Company's valued investors and all other business partners for their continued co-operation and excellent support received during the year. Your Directors recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution to its progress. On behalf of the Board of Directors Deepak Jatia Chairman & Managing Director Mumbai 30th May, 2015 |