REPORT OF THE BOARD OF DIRECTORS AND MANAGEMENT DISCUSSION AND ANALYSIS To The Members Your Directors have pleasure in presenting the Twenty Fourth Annual Report, together with the Audited Accounts of the Company for the year ended 31st March 2015. DIVIDEND: Considering the current financial position, the Board of Directors does not recommend any dividend for the financial year 2014-15. REVIEW OF OPERATIONS: Amid optimism and rising business sentiments, your Company reported a top-line growth of around 7% increase over previous year. The Gross revenue from operations stood at Rs. 3517.47 lakhs compared with Rs. 3305.83 lakhs in the previous year. The Operating profit before depreciation and tax (cash profit) stood at Rs. 116.70 lakhs against the cash loss of Rs. 32.40 lakhs in the previous year. Your Company has recorded a Net loss of Rs. 5.89 lakhs against the Net loss of Rs. 103.10 lakhs in the previous year. The accumulated losses have been increased to Rs. 480.13 lakhs resulting in erosion of around 78% of the Networth of the Company. During the year under review, your Company has achieved the budgeted profit for the year 2014-15. With the change in the depreciati on provision as prescribed under the schedule II of the Companies Act, 2013, the Company has incurred an additional depreciation cost resulted with a loss of Rs. 5.89 lakhs for the year. Your Company has gone ahead with multiple strategies in the year 2014-15 for reducing the working capital difficulties and improving the productivity. Inspite of facing tough challenges during the year viz., volatility in raw material price, increase in power cost and consumables, major changes in the laws and regulations, your Company has performed in an increasing trend achieving the target predetermined for the year and consequently registering an operating profit before depreciation and tax. The continuous working capital support from the bankers and the infusion of funds by the Promoters were also the reasons for the improved performance. Your management will conti nue their effort in further improving the performance of the company by expanding market, developing various cost cuffing and value engineering measures, concentrating more in value added structure to increase the stability in the competitive market and to increase not only the volume but also profit margins in the coming years. MANAGEMENT DISCUSSION AND ANALYSIS REPORT: As required under Clause 49 of the Listing Agreement with Stock Exchange, the Management Discussion and Analysis Report is enclosed as Annexure- 1. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure - 2 and forms an integral part of this Report. DIRECTORS: Pursuant to the provisions of the section 161(1) and section 149 of the Companies Act, 2013 read with the Articles of Association of the company, Smt. Shobha Gupta is appointed as Additional Director and she shall hold office only up to the date of this Annual General Meeting and being eligible offer herself for appointment as Director. Pursuant to the provisions of the section 161(1) and section 149 of the Companies Act, 2013 read with the Articles of Association of the company, Sri. R. Sukumar is appointed as Additional Director and he shall hold office only up to the date of this Annual General Meeting and being eligible offer himself for appointment as Director. The Company has pursuant to the provisions of clause 49 of the Listing Agreement entered into with the Stock Exchange and section 149 of the Companies Act, 2013 has appointed Smt. Shobha Gupta and Sri. R. Sukumar as Independent Directors of the Company, to hold office for a term of five years till the conclusion of 29th Annual General Meeting of the Company, subject to the approval of the shareholders in the ensuing Annual General Meeting. The Company has received declarations from the appointee independent directors, that they meet the criteria of independence, as prescribed both under sub-section (6) of section 149 of the Companies Act, 2013 and under the said clause 49 of the Listing Agreement. Sri. G.P.N. Gupta retires by rotation at the Annual General Meeting and being eligible offers himself for re-appointment. NUMBER OF MEETINGS OF THE BOARD AND BOARDS' COMMITTEE: The details of the number of Board Meetings and the Committee of the Board held during the financial year 2014-15 form part of the Corporate Governance Report. INDEPENDENT DIRECTORS: Sri. M.V. Chandrashekar, Sri. S. Ramakrishnan, Sri. M. Ravindra Reddy and Sri. Sanjay Ramaswami who were appointed in 23rd Annual General Meeting as an Independent Director of the Board for a period of five (5) years continue to be in the Board till the period ended 31st March 2019, not liable to retire by rotation. The Company has received necessary declaration from each Independent Director of the Company under Section 149(7) of the Act, that they meet the criteria of independence as laid down in Section 149(6) of the Act. BOARD EVALUATION: Pursuant to the provision of the Companies Act, 2013 and clause 49 of the Listing Agreement, a structured questionnaire was prepared after taking into consideration of the various aspects of the Boards' functioning, composition of the Board and its committees, culture, execution and performance of specific duties, obligations and governance. The performance evaluati on of the Independent Directors was completed. The performance evaluati on of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process. DIRECTORS' RESPONSIBILITY STATEMENT: As required under Section 134(3)(C) of the Companies Act, 2013 the Directors hereby state and confirm that they have: a. In the preparation of the annual accounts for the year ended 31st March 2015, the applicable accounting standards had been followed along with proper explanation relating to material departures; b. They have 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 loss of the Company for the year ended on that date; c. They have 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. They have prepared the annual accounts on a going concern basis; e. They have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and operating effectively; and f. They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. VIGIL MECHANISM: The Company has established a Whistle Blower Policy / Vigil Mechanism Policy and also established a mechanism for directors and employees to report their concerns. The details of the Policy have been outlined in the Corporate Governance Report. The policy has been uploaded in the website of the Company at www.blissgroup.com NOMINATION AND REMUNERATION POLICY: The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the company. The policy also lays down the criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance Report. STATUTORY AUDITORS: Pursuant to the provisions of Secti on 139 of the Companies Act, 2013, the appointment of M/s. M.Srinivasan & Associates, Chartered Accountants as Statutory Auditors of the Company have been approved in the 23rd Annual General Meeting of the Company. They shall hold office until the conclusion of the 26th Annual General Meeting of the Company subject to ratification of their re-appointment by the Shareholders at every AGM. A resolution ratifying the re-appointment of Statutory Auditors forms part of the notice. INDEPENDENT AUDITOR'S REPORT: Clarification on Auditor's observation is given below: 'Emphasis of Matter' of the Independent Auditor's Report: We draw attention to Note No.4 of the notes to accounts to the financial statements prepared on going concern basis which is self explanatory. Our opinion is not modified in respect of this matter. Managements' Reply: As mentioned in note no. 4 of notes on accounts, the accumulated losses as on 31st March 2015 has resulted with an erosion of 78% of the Networth of the Company. The additional depreciation cost incurred during the year due to reassessment of depreciation as per schedule II of the Companies Act, 2013 is the main reason for the loss during the year and the increase in the erosion of Networth of the Company. However, the Company had shown a good improvement in the performance during the year 2014-15 achieving cash profit of Rs. 116.70 lakhs against the cash loss of Rs. 32.40 lakhs in the previous year. During the year 2014-15, the Company has achieved the budgeted target and the order booking status was also quite good. With the change in the political scenario, the Company is also confident of having a good sale opportunity of its land at Nellore which will bring long term liquidity resulting in reducing the interest burden. Further, with the anticipated big orders, increase in the productivity and marketing capability and the continued financial support from the bankers and the promoters, the Company is confident of achieving better results in the years to come. COST AUDIT: Pursuant to notification of Companies (Cost Records and Audit) Rules, 2014 read with Companies (Cost Records and Audit) amendment rules, 2014, the Company's product does not fall under the purview of Cost Audit from the financial year 2014-15. The Company has also intimated the non-applicability of Cost Audit to the Registrar of Companies. SECRETARIAL AUDITORS: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed Messrs Lakshmmi Subramanian & Associates, Practising Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for the year 2014-15 is included as Annexure -3 and forms an integral part of this Report. There is no secretarial audit qualification for the year under review. LOANS, GUARANTEES AND INVESTMENTS: The Company has not granted loan or guarantee in respect of a loan to any person or body corporate or acquisition of shares in other body corporate. RELATED PARTY TRANSACTIONS: All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are 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. Thus, disclosure in Form AOC-2 is not required. The related party transactions as required under Section 134(3)(h) of the Companies Act 2013, r/w Rule 8 of the Companies (Accounts) Rules, 2014 are detailed under Note 13 - Notes annexed to and forming part of the Balance Sheet of the company. PERSONNEL: None of the employees of the Company drew remuneration which in the aggregate exceeded the limits fixed under Secti on 134(3)(q) read with Rule 5 of the Companies (Appointment and Remunerati on of Managerial Personnel) Rules, 2014. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: The Particulars relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Sec.134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are enclosed as part of the Report as Annexure - 4. CORPORATE GOVERNANCE: As prescribed under the Listing Agreement which came into force from 1st October 2014, your Company does not fall under the purview of applicability of clause 49 of the Listing Agreement. During the year, with the approval of Board of Directors, your Company has informed the non-applicability provision to the Bombay Stock Exchange. However, your Company has complied with all mandatory provisions of Corporate Governance as prescribed under the Old Listing Agreement of the Stock Exchanges in which the Company is listed. In line with the requirements of Clause 49 of the listing agreement, a separate report on Corporate Governance, along with a certificate from the Statutory Auditors of the Company is annexed herewith to this report. LISTING FEES: The Company confirms that it has paid the annual listing fees for the year 2015-16 before the due date to the Bombay Stock Exchange. CLOSURE OF REGISTER OF MEMBERS AND SHARE TRANSFER BOOKS: The Register of Members and Share Transfer books of the company will be closed with effect from 18th September, 2015 to 24th September, 2015 (both days inclusive). FIXED DEPOSITS: During the financial year 2014-15, your Company has not accepted any deposit under the provisions of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014. As required under the provision of Section 74(1)(b) of the Companies Act, 2013 and the explanation given under Rule 19 of the Companies (Acceptance of Deposits) Rules, 2015, your company has repaid the deposits accepted under Companies Act, 1956 with interest, that were repayable upto 30th June 2015. The deposits which are repayable in the period 1st July 2015 to 31st December 2016 amounting to Rs. 14,50,000/- will be repaid with interest on or before their due dates. AUDIT COMMITTEE RECOMMENDATION: During the year all the recommendations of the Audit Committee were accepted by the Board. The Composition of the Audit Committee is as described in the Corporate Governance Report. INTERNAL COMPLAINTS COMMITTEE: The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee ("ICC") has been set up to redress the complaints received regarding sexual harassment. All employees are covered under this policy. The following is the summary of the complaints received and disposed off during the financial year 2014-15: a) No. of complaints received: NIL b) No. of complaints disposed off: NIL In the meeting held on 28th May 2015, the Board has approved the reconstitution of the Committee with the following members: 1. Ms. Charumathi - Presiding Officer 2. Shri. Anderson - Member cum HR 3. Shri. Thalamuthu Natarajan - Independent Member 4. Ms. P. Pushpavathy - Member SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS OR REGULATORS OR TRIBUNALS: During the year, the Company has not received any significant and material orders passed by the Regulators or courts or tribunals which would affect the going concern status of the Company and its future operations. QUALITY MANAGEMENT SYSTEMS: Your Directors are happy to report that as a commitment in meeting global quality standards, your company continues to have ISO 9001:2008 quality management systems a certificate from Intertek Certification Limited. FORWARD LOOKING STATEMENTS: Statements in this management discussion and analysis describing the Company's objectives, projections, estimates and expectations may be 'forward-looking statements' within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied. Important factors that could make a difference to the Company's operations include economic conditions affecting demand/supply and price conditions in the domestic and overseas markets in which the company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors. ACKNOWLEDGEMENT: Your Directors take this opportunity to express their sincere gratitude to the encouragement, assistance, co-operation and support given by the Central Government, the Government of Tamil Nadu, the Karnataka Bank Ltd. during the year. They also wish to convey their gratitude to all the investors, customers, Auditors, suppliers, dealers and all those associated with the company for their continued patronage during the year. Your Directors also wish to place on record their appreciation for the hard work and unstinting efforts put in by the employees at all levels. For and on behalf of the Board G. Radhakrishna Managing Director G.V. GopinathDirector Finance Place : Chennai Date : 13th August 2015 |