BOARD'S REPORT To The Members, The Directors are pleased to present their Thirty-Third Annual Report and Audited Accounts for the year ended 31st March, 2015. 2. Operations/State of Company's Affairs Financial Year 2014-15 has been a year of challenges, Raw material prices continued to be volatile during the year. Volatility in crude oil prices has adversely affected raw materials prices and its availability. Demand in domestic as well as export market was also affected due to this factor. Despite these adverse market conditions, Company has been able to achieve higher volumes. However the margins continue to be under pressure. During the year under review, Sales volume has increased by 11 % while sales value has increased by 15% to Rs. 94,10,18,308/- from Rs. 81,98,40,195/- in the previous year. However profit before tax has dropped by 16% to Rs. 2,28,31,913 from Rs. 2,69,75,498. The Company continues to invest in equipments and ancillaries to upgrade its production facilities for meeting customer's quality requirements and for improving efficiencies. No Material Changes have occurred from the end of the Financial Year till the date of this report affecting the Financial Position of the Company. There is no Change in the nature of business during the year under review. No significant and material orders have been passed by the regulators or Courts or Tribunals impacting the going concern status and the company's operations in future during the year under review. 3. DIVIDEND The Board of Directors have recommended a dividend of Rs. 1.2 per equity share (12%) for the year 2014-15. (Previous year - 12 %) for approval at the Annual General Meeting. The dividend if approved, will result in a cash outflow of Rs. 43.20 lacs including dividend distribution tax which would be Rs. 7.20 lacs as compared to Rs. 5.84 lacs in previous year. 4. TRANSFER TO RESERVES The Company proposes to transfer Rs. 25 lacs to the General Reserve out of the amount available for appropriation and an amount of Rs. 82.70 lacs is proposed to be retained in the statement of Profit and Loss. 5. BOARD MEETINGS: The Board of Directors met 7 times during the Financial Year 2014-15. 6. D I RE CTORS AN D KE Y M AN AGE RI AL PERSONNEL : Mr. Pheroze Kharas, Director of the Company, is liable to retire by rotation, retires at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. Pursuant to the provisions of Section 149 of the Act, which came into effect from April 1, 2014, Mr. Jehangir Moos, Mr. Mukul Desai and Mr. Bhupendra Desai were appointed as Independent Directors at the Annual General Meeting of the Company held on 20th September, 2014. With a view to strengthen the Board and also to meet the regulatory requirements, Mrs. Charulata Patel, was appointed as an Additional Director of the Company with effect from November 08, 2014 and Mr. Dhananjay Desai was appointed as Additional Director of the Company with effect from May 28, 2015. The resolutions seeking approval of the Members for the appointment of Mrs. Charulata Patel and Mr. Dhananjay Desai have been incorporated in the notice of the forthcoming annual general meeting of the Company along with brief details about them. The Company has received notices under Section 160 of the Act along with the requisite deposit proposing their appointment. Pursuant to the provisions of Section 203 of the Act, which came into effect from April 1, 2014, the appointments of Managing Director and Chief Financial Officer as key managerial personnel of the Company was formalised. During the year Company also appointed a Company Secretary as required under the provisions of Section 203 of the Act. The members at the 30th Annual General Meeting held on 22nd September 2012 had approved the appointment of Mr. Jaymin Desai as Managing Director of the Company for a period of 3 years from 1st October, 2012 to 30th September, 2015. The Board Proposes to re-appoint him as the Managing Director for a further period of 3 years i.e from 1st October, 2015 to 30th September, 2018 at the ensuing Annual General Meeting. 7. DECLARATION FROM INDEPENDENT DIRECTORS The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet the criteria of their Independence laid down in Section 149(6). 8. AUDIT COMMITTEE The Audit Committee of the company consists of following members. I. Mr. Mukul Desai-Chairman II. Mr. Pheroze Kharas III. Mr. Jehangir Moos IV. Mr. Bhupendra Desai 9. NOMINATION AND REMUNERATION POLICY The Policy adopted by the Company's Nomination and Remuneration Committee on Selection of Directors & Senior Management Personnel and on Remuneration is annexed as Annexure-I to this Report. 10. VIGIL MECHANISM The Details of Vigil Mechanism adopted by the Board is annexed as Annexure-II to this Report 11. DIRECTOR'S RESPONSIBILITY STATEMENT: In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm that: (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 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 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, 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. 12. SUBSIDIARY COMPANY A Statement Containing the Salient features of the Financial Statement of the Subsidiary Company is annexed as Annexure- III as a part of this Report. During the year under review, No Company have become or ceased to be Company's subsidiaries, joint ventures or associate companies. 13. EXTRACT OF ANNUAL RETURN: As required pursuant to section 92(3) of theCompaniesAct,2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual return in Form MGT 9 is Annexed as Annexure -IV as a part of this Report. 14. AUDITORS: At the 32nd Annual General Meeting of the Company held on 20th September, 2014, M/s. Akkad Mehta and Co., (Firm Registration No 100259W), Chartered Accountants, was appointed as the Auditors of the Company from the conclusion of 32nd AGM till the conclusion of the 35th AGM of the Company to be held in the year 2017(subject to ratification of their appointment at every AGM). The Board Places Ratification of their Appointment till Conclusion of the Next AGM for the Member's Approval. 15. SECRETARIAL AUDIT: Secretarial audit report as provided by M/s Parikh & Associates, Practicing Company Secretaries is annexed to this Report as Annexure- V. 16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: Information in accordance with Clause (m) of Sub-section (3) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 is annexed to this Report as Annexure -VI. 17. DEPOSITS: The Company has not accepted any deposits during the year under report. 18. DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS The Company has a proper and adequate system of internal financial controls commensurate with its nature and size of business and meets the following objectives: • Providing assurance regarding the effectiveness and efficiency of operations; • Efficient use and safeguarding of resources; • Compliance with policies, procedures and applicable laws and regulations; and • Transactions being accurately recorded and reported timely. • The Company has a budgetary control system to monitor expenditures and operations against budgets on an ongoing basis. • The Internal Auditor also regularly reviews the adequacy of internal financial control system. 19. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: As on 31st March 2015 the Company has provided the following Loans, Guarantees and Investments under section 186 of the Companies Act, 2013. i. Loans :Rs. 3,72,18,771/- to Synergy Films Private Limited Wholly Owned Subsidiary ii. Guarantees: Rs. 6,06,00,000/- to Bank & Financial Institution for the Loans advanced to Synergy Films Private Limited Wholly Owned Subsidiary. iii. Investments; Rs. 81,76,257/- for 11,95,360 Equity Shares of Rs. 10 each fully paid up in Synergy Films Private Limited Wholly Owned Subsidiary 20. RISK MANAGEMENT POLICY : The Company has adopted a Risk Management Policy which is implemented throughout the Organisation; Special Emphasis on Risk Management is given during the Annual Budgeting Process and Periodical Monthly Meetings. 21. CORPORATE SOCIAL RESPONSIBILITY POLICY : The Provisions of Corporate Social Responsibility under section 135 of the Companies Act, 2013 are not applicable to the company. However as a part of CSR initiative, The Company has adopted 15 Mentally Challenged Children who are under rehabilitation in Jaina anupam N. Charitable Trust, Valsad. 22. RELATED PARTY TRANSACTIONS Particulars of Contracts or Arrangements with Related parties referred to in Section 188(1) in Form AOC- 2 is annexed as Annexure - VII to this Report 23. FORMAL ANNUAL EVALUATION: The Company has a Policy for evaluation of Performance of Directors and the Board. Based on the Principle Laid out in the said Policy, Nomination & Remuneration Committee has evaluated the Performance of Every Director. Over and above, Independent Directors in their Separate Meeting held have evaluated Performance of Non-Independent Directors, The Chairman and the Board as a whole. The Board has also evaluated the Performance of Independent Directors 24. PARTICULARS OF EMPLOYEES The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given as Annexure - VIII to this Report 25. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013: The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and Redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. During the financial year 2014-15, the Company has received nil complaints on sexual harassment. 26. LISTING WITH STOCK EXCHANGE: The Company confirms that it has paid the Annual Listing Fees for the year 2015-2016 to BSE where the Company's Shares are listed. 27. CORPORATE GOVERNANCE: In terms of the Securities and Exchange Board of India ("SEBI") circular no. CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014 the compliance of provisions of the revised Clause 49 of the Listing Agreement are not mandatory to the Company for the time being. Details of Directors Remuneration as required under Schedule V Part II, Section II (A) (IV) of Companies Act 2013 is annexed as Annexure - IX to this Report. 28. ACKNOWLEDGMENT The Directors wish to convey their appreciation to Customers, Suppliers, Bankers, other Stakeholders and specially the employees for their co-operation. The Directors also appreciate the confidence reposed in the Management of the Company by its shareholders. For, and on behalf of the Board of Directors P. P. Kharas CHAIRMAN DIN:00026026 Place : Mumbai, date : 28th May, 2015. |