DIRECTORS REPORT AND MANAGEMENT DISCUSSION AND ANALYSIS Your Directors have pleasure in placing before you their Sixty Ninth Annual Report together with the Audited Financial Statements for the year ended March 31, 2015. The Management Discussion and Analysis is also included in this Report. Economic Overview: The global economy grew at 3.5% in 2015. The growth in 2014-15 was led by advanced economies particularly the US. Key factors which shaped the global economy were decline in prices of oil and other commodities, easy monetary policy followed by central banks globally in a bid to boost inflation and growth, slowdown in China and geopolitical risks. The Indian economy, after a prolonged period of sluggish growth displayed some initial recovery signs during financial year 2014-15, largely attributed to an improved macroeconomic environment and pro-growth economic reforms initiated by the new government at the centre. Despite this, the investment eliminate remained subdued during 2014-15. It appears the reform process would take some more time to gain ground. Industrial demand was weak anc capacity utilisation remained low across the sectors. Against this back ground, the performance of your Company during 2014-15 is presented in the following paragraphs. 2. OPERATIONS During the year under review, revenue from operations of the Company was higher by 16.34% at Rs. 365.86 lacs as against 314.47 lacs in the previous year. The profit before tax significantly rose to Rs. 100.73 lacs as compared to the loss of Rs. 45.88 lacs recorded last year. Net profit after tax stood substantially higher at Rs.130.30 lacs. The Company is hopeful for a better year ahead. As reported last year the Company's factory at Sarigam, Gujarat resumed manufacturing activities in April 2014. The plant has since stabilized its operations. It is presently engaged in doing job work. No material changes and commitments have occurred after the close of the year till the date of this report which might affect the financial position of the Company. 3. DIRECTORS a) At the 68th AGM held on 30.09.2014, Mr B.L.Jatia was reappointed as the Managing Director of the Company for a period of 3 years w.e.f. 1.4.2014. b) Ms Smita Jatia was appointed as a Director at the 68th AGM held on 30.9.2014. c) Mr Om Prakash Adukia retires by rotation at the ensuing Annual General Meeting but being eligible offers himself for re-appointment. d) Mr Dharmendra Agarwal who is proposed to be appointed as an independent Director possesses the requisite expertise and knowledge and is qualified for appointment as an Independent Director. e) Board Evaluation The Board has carried out an annual evaluation of its own performance, of the directors individually as well as of the independent directors. The performance evaluation of non-independent directors was also carried out by the independent directors at a separate meeting. The directors expressed satisfaction with the evaluation process and the results. f) Declaration by Independent Directors Necessary declarations have been obtained from each indepencent director under Section 149(7) of the Companies Act. 2013 (the Act) that he meets the criteria of independence laid down in Section 149 (6) of the Act. g) Meetings During the year six board meetings were convened and held. 4. CHIEF FINANCIAL OFFICER Mr Narendra Abhichandani was appointed as the Chief Financial Officer of the Company w.e.f. 01.06.2014. 5. AUDITORS M/s GMJ & Co., Chartered Accountants (Firm Registration No.103429W) were appointed as Statutory Auditors of the Company at the last Annual General Meeting for a period of five years subject to ratification by members at every subsequent Annual General Meeting. Ratification of their appointment is therefore being sought from members of the Company at the ensuing Annual General Meeting. 6. AUDITORS' REPORT The Auditors' Report does not contain any reservation, qualification or adverse remark. 7. SECRETARIAL AUDIT Pursuant to provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr Shailesh Kachalia, a Company Secretary in practice (CP No.3888) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended 31st March, 2015 is annexed hereto as 'Annexure I'. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. 8. LOANS, GUARANTEES OR INVESTMENTS Particulars of loans given and investments made are given in the notes to the financial statements. No guarantees/securities were provided to other bodies corporate during the financial year. 9. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES All contracts/arrangements/transactions entered into by the Company during the financial year 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 info 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 transactions. 10. ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE EARNINGS AND OUTGO Information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required by Section 134(3) (m) of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2011 is given in Annexure II to this report. 11. INTERNAL FINANCIAL CONTROL The Company has in place internal financial control systems, commensurate with its size and nature of operations to ensure proper recording of financial and operational information and compliance of various internal controls and other regulatory and statutory compliances. The internal auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company. Based on the report of the internal auditor, respective departments undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. 12. RISK MANAGEMENT The Audit Committee has been delegated the responsibility of developing, implementing and monitoring a risk management plan and identifying, reviewing and mitigating all elements of risk which the Company may be exposed to. 13. NOMINATION AND REMUNERATION COMMITTEE A Remuneration Committee had been constituted with Mr N S Karnavat as Chairman and M/s Hasmukh Gandhi and Tushar G Agarwal as members under the Companies Act, 1956. Keeping in view the new provisions of the Act. the Board has renamed the said committee as 'Nomination and Remuneration Committee' retaining the same members in the Committee. The Company's policy on directors' appointment and remuneration, etc. is attached as Annexure III and forms part of this report. 14. CORPORATE SOCIAL REPONSIBILITY None of the three criteria specified in section 135(1) of the Act relating to constitution of a CSR Committee is applicaole to the Company and as such is not required to be complied with. 15. AUDIT COMMITTEE An Audit Committee was constituted by the Board at its meeting held on 6th May 2014 comprising Mr Hasmukh Gandhi as Chairman and M/s Narendra Karnavat, Mr Tushar Agarwal and Mr.O P Adukia as members with the Company Secretary Ms Smita Tambe as Secretary. During the year there were no instances where the Board had not accepted the recommendations of the Audit Committee. The Company has also put in place a vigil mechanism for directors and employees to report their concerns/grievances etc. to the Audit Committee which oversees the functioning of such mechanism. 16. SUBSIDIARY, JOINT VENTURE OR ASSOCIATE COMPANIES The Company has no subsidiary, joint venture or associate. 17. PARTICULARS OF EMPLOYEES a. Prescribed particulars of employees required under Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached as Annexure - IV and form part of this report. b. There are no employees covered by Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. 18. EXTRACT OF ANNUAL RETURN An extract of the Company's Annual Return in form MGT-9 is annexed hereto as Annexure V. 19. CORPORATE GOVERNANCE A report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement has been attached and forms part of this Report. 20. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to provisions of Section 134(3)( c) read with Section 134(5) of the Act, your Directors state that: (a) In the preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanation relating to material departures; (b) The directors have selected 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 of the Company for that period ; (c) The directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding assets of the Company and for preventing and detecting frauds and other irregularities; (d) The directors have prepared the annual accounts on a going concern basis; (e) The directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and (f) The directors have devised proper systems to ensure compliance with provisions of all applicable laws and such systems are adequate and operating effectively. 21. GENERAL Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions covered by 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. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the Company's going concern status and operations in the future. Your director’s further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. ACKNOWLEDGEMENTS The Board sincerely tnanks all stakeholders for their continued support. For and on behalf of the Board Banwari Lal Jatia Managing Director Om Prakash Adukia Director Dated: 12th August, 2015 |