DIRECTOR’S REPORT Your Directors are pleased to place before you the Twenty Third Annual Report and the Audited Accounts of the company for the year ended March 31, 2015. REVIEW OF OPERATIONS The year under review continued to remain challenging despite some recovery in consumption of fertilizers after experiencing set back in preceding three years. High imports, deficit and untimely monsoon, falling crop acreages, low reservoir levels and declining agri commodity prices impacted farm sector. During the year, your company continued expansion of its marketing network in the states of Karnataka and Telangana. During the year under review, the Company achieved turnover of Rs. 11282 Lacs as against the previous year Rs. 8908 Lacs. The earnings before interest, depreciation and tax (EBIDTA) was Rs.885 Lacs against Rs. 976 Lacs of the previous year. The increasing raw materials cost and competitive prices on sales front resulted in fall in profit margins. The lower demand for Deoiled cakes in international market with falling prices in domestic market impacted the company's solvent business through its subsidiaries. The company could achieve a consolidated turnover of Rs.51870 Lacs as compared to previous year's Rs. 52615 Lacs and Net Profit Before Tax of Rs.1002 Lacs for the year under review as against the previous year's consolidated Net Profit Before Tax of Rs. 1015 Lacs. MANAGEMENT DISCUSSION & ANALYSIS A report on Management Discussion and Analysis, which forms part of this Annual Report, inter-alia, deals with the operations as also current and future outlook of the company, is furnished separately. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to the provisions of Section 134 (3) (c) and 134(5) of the Companies Act 2013, the Board of Directors of Shiva Global Agro Industries Limited make the following statements, to the best of their knowledge and belief and according to the information and explanations obtained by them: T That in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed and there have been no material departures there from; T That the accounting policies mentioned in Notes forming part of the Financials Statements have been selected and applied consistently and judgments 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, 2015 and of the profits of the Company for the year ended on that date; T That proper and sufficient care has been taken for the maintenance 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; T That the annual financial statements have been prepared on a going concern basis; T That proper internal financial controls have been laid down to be followed by the Company and such internal financial controls are adequate and operating effectively; T That proper systems are in place to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively. CONSOLIDATED FINANCIAL RESULTS: Consolidated Financial Statements incorporating the operations of the Company and its subsidiaries is appended. As required under the provisions of the Act, a statement showing the salient features of the financial statements of the subsidiaries is enclosed as an Annexure A to this Report. However, the Accounts of the Subsidiary Companies and the related information will be made available to the Members of Shiva Global Agro Industries Limited and its Subsidiary Companies on request and will also be kept for inspection at the Registered Office of the Company. SUBSIDIARY COMPANIES: i) Shiva Parvati Poultry Feed Private Limited: The Company (a 51 % subsidiary) achieved a total turnover of Rs.11853.57 Lacs and earned Rs.101.55 Lacs of Profits After Tax. ii) Ghatprabha Fertilizers Private Limited The Company (a 61.53% subsidiary) achieved a total turnover of Rs.10721.03 Lacs and earned Rs.147.78 Lacs of Profits After Tax. iii) Shrinivasa Agro Foods Private Limited The Company (a 51.01% subsidiary) achieved a total turnover of Rs.16493.90 Lacs and earned Rs. 217.17 Lacs of Profits After Tax. iv) Kirtiman Agrogenetics Limited The Company (a 64.50% subsidiary) achieved a total turnover of Rs.3261.33 Lacs and earned Rs.6.83 Lacs of Profits After Tax. SAFETY, HEALTH & ENVIRONMENT (SHE): Company's focus on Safety, Health and Environment continued during the year under review across all locations with all manufacturing plants maintaining high safety standards. Your Company maintained high standards of environmental performances with all facilities operating well within norms. The overall safety environment continued to improve during the year under review. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS Details of loans and guarantees given and investments made under Section 186 of the Act are given in the Notes to the Financial Statements. FIXED DEPOSIT Your company has accepted fixed deposits during the year and there are no unpaid/ overdue fixed deposits. PARTICULARS OF EMPLOYEES A table containing the particulars in accordance with the provisions of Section 197(12) of the Act, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure B to this Report. The Company has no Employees whose salary exceeds the limits prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. EXTRACT OF THE ANNUAL RETURN In accordance with Section 134(3)(a) of the Act, an extract of the Annual Return in the prescribed format is appended as Annexure C to this Report. CORPORATE GOVERNANCE The Company is committed to maintain high standards of Corporate Governance. As stipulated under the requirements of the Listing Agreement with Stock Exchanges, a report on Corporate Governance duly audited is appended as Annexure D for information of the Members. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is attached to the Report on Corporate Governance. DIRECTORS In accordance with Article 31 of the Company's Articles of Association, read with Section 152 of the Companies Act, 2013, Mr. Arun R. Toshniwal is retiring at the ensuing Annual General Meeting. Mr. Arun R. Toshniwal, being eligible, offer himself for re-appointment. All the Independent Directors of the Company have given declarations under sub-section (6) of Section 149 of the Act, and the same have been considered and taken on record by the Board. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS On their appointment, Independent Directors are familiarized about the Company's operations and businesses. Interaction with the Business Heads and key executives of the Company is also facilitated. Detailed presentations on the business of each of the Division are also made to the Directors. Direct meetings with the Chairman and the Managing Director are further facilitated for the new appointee to familiarize him/ her about the Company/its businesses and the group practices. The role, rights, duties and responsibilities of Independent Directors have been incorporated in the Letters of Appointment issued to them. The amendments / updates in statutory provisions are informed from time to time. The details of familiarisation programme as above are also disclosed on the Company's website. NUMBER OF BOARD MEETINGS A calendar of meetings is prepared and circulated in advance to the Directors. During the year 2014-15, eleven Board Meetings were held, the details of which are given in the Report on Corporate Governance. INTERNAL FINANCIAL CONTROL SYSTEMS The Company has adequate Internal Financial Controls commensurate with the nature, size, and complexity of the businesses and operations. These are routinely tested and certified by Statutory as well as Internal Auditors. Significant audit observations and the follow up action are reported to the Audit Committee. WHISTLE BLOWER POLICY The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical conduct. The Company has a Whistle Blower Policy which provides the employees, customers, vendors and directors an avenue to raise concerns on ethical and moral standards and legal provisions in conduct of the business operations of the Company. The Whistle Blower Policy is also placed on the website of the Company at www.shivaagro.com PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE POLICY The Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (Act). An Internal Compliance Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees are covered under this Policy. During the year 2014-15, there were no complaints received by the ICC. BOARD EVALUATION In accordance with the provisions of the Act and Clause 49 of the Listing Agreement, the Board has carried out evaluation of its own performance, the performance of Committees of the Board, namely, Audit Committee, Stakeholders Relationship Committee, Nomination and Remuneration Committee and Risk Management Committee and also the directors individually. The manner in which the evaluation was carried out and the process adopted has been mentioned out in the Report on Corporate Governance. REMUNERATION POLICY The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration. Salient features of the Remuneration Policy are set out in the Report on Corporate Governance. RISK MANAGEMENT POLICY The Company has constituted a Risk Management Committee. Details of constitution of the Committee and its terms of reference are set out in the Report on Corporate Governance. The Company has formulated a Risk Management Policy, under which various risks associated with the business operations are identified and the mitigation process are being taken up. MATERIAL SUBSIDIARY POLICY The Company has adopted a policy for determining material subsidiary, in line with the requirements of the Listing Agreement. The Policy on Material Subsidiary is available on the website of the Company. RELATED PARTY TRANSACTIONS All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of business. There were no material significant related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel or the Senior Management which may have a potential conflict with the interest of the Company at large. All related party transactions were placed before the Audit Committee / Board for approval. Prior approval of the Audit Committee was obtained for the transactions which are foreseen and are in repetitive in nature. The related party transactions entered into are reviewed by an independent audit firm to confirm that they were in the ordinary course of business and at arm's length basis. The Company has formulated a policy for Related Party Transactions which has been approved by the Board and is placed on the website of the Company. None of the Directors had any pecuniary relationship or transactions with the Company, except the payments made to them in the form of remuneration, sitting fee and commission. AUDIT COMMITTEE The Audit Committee comprises of Mr. Deepak S. Maliwal, Chairman, Mr. Divakar Shetty and Mrs. Sandhya Maheshwari. All the recommendations made by the Audit Committee were accepted by the Board. STATUTORY AUDITORS M/s. Jhavar Ladha & Associates, Chartered Accountants, were appointed as Auditors of the Company for a period of five years from the conclusion of the last Annual General Meeting held on 30th September, 2014. As required under the provisions of Section 139 of the Act, a resolution for the yearly ratification of their appointment is being placed before the shareholders for their approval. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Act. COST AUDITORS Pursuant to Section 148 of the Act, read with The Companies (Cost Records and Audit) Rules 2014, as amended, the cost records of the Company are required to be audited. Based on the recommendations of the Audit Committee, your Board has appointed the following practicing Cost Accountants, Mr. Jayant B. Galande, to audit the cost records of the Company. The Cost Audit Report for the year 2013-14 has been filed with MCA within the prescribed time limit. SECRETARIAL AUDITOR Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Board had appointed Mr. Mohammad Anwar ul haq of M/s. AMAM & Associates, Company Secretaries, to undertake the secretarial audit of the Company. The report of the Secretarial Auditor is marked as Annexure E to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Act, read with Companies (Accounts) Rules, 2014, are enclosed as Annexure F to this Report. CONDOLENCE We, the Members of the Board, wish to place on record our profound grief and deep sense of sorrow at the sad demise of Chief Executive Finance and Compliance Officer of our Company, Mr. Navinkumar Jain on 04th December, 2014. We also record our appreciation on the exemplary and selfless service rendered by him for the growth and development of the Company, since he joined the Company. ACKNOWLEDGEMENT The Directors acknowledge and would like to place on record the commitment and dedication on the part of the employees of your Company for their continued efforts in achieving good results, in an adverse situation. The Directors also wish to acknowledge and record their appreciation of the continued support and assistance received by the Company from Union Bank of India and other Banks, financial institutions, as well as from various Government bodies both at the Centre and the State. By the order of the Board Omprakash Gilda Managing Director Place: Nanded Dated: 30th May, 2015 |