DIRECTORS' REPORT To, The Members, Ceenik Exports (India) Ltd. Your Directors hereby present their TWENTYFIRST ANNUAL REPORT alongwith the Audited Financial Statements for the year ended 31" March, 2015. Dividend Considering the exigencies of the fund, your Directors have not recommended any dividend. Directors' Responsibility Statement: Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to be best of their knowledge, confirm that a) in the preparation of the accounts the applicable accounting standards have been followed along with proper explanations relating to material departure; b) appropriate accounting policies have been selected and applied consistently and have 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) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) the annual accounts have been prepared 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 were operating effectively; f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. MANAGEMENT DISCUSSION AND ANALYSIS FOR2 014-2015 To avoid repetition in Directors' Report and Management Discussion & Analysis, your Directors have presented a composite summary of performance and functions of the Company. Economy Global economy in the year 2014-15 reflected a moderate pick-up in growth in advanced economies. However, slow down in emerging market and developing economies has continued. Economic growth in India is projected to be stronger in 2015-16 compared to the last year. However, Geopolitical tension continues to pose threats. In some advanced economies, protracted low inflation or deflation also poses risks to economic activity. The decline in crude price could boost economic activities in India. Industry Structure and development Your Company belongs to the Garment and apparel industry, which is susceptible to fast changing trends and styles. It is a labour intensive Industry and requires skilled and unskilled labour in large numbers. The new Government has laid emphasis on job oriented industries to generate employment Regulations Performance of the Company Domestic sales for the year under review were Rs.627.13 lacs, a fall of 12% compared to last year. Income from the real estate and investment activities was up by about 73% mainly due to the profit realized on sate of Industrial unit. The total income for the year under review was Rs.1012.06 lakhs and profit after tax of Rs.36.82 lacs as against Rs.933.10 lakhs and loss after tax of Rs.123.28 lacs for the previous year respectively. Opportunity and threats Your Company is strengthening its manufacturing facilities and is able to procure the entire range of Men's wear at low cost with reasonably good quality. The growing young population of our country gives tremendous scope for the development of this industry. The unavailability of skilled labour and high sticky inflation has caused a cascading effect on the growth rates of wages and manpower costs. The New Government is committed to encourage the healthy growth of Capital Market for development of the Economy. The market regulators are also concerned in regaining the confidence of investors, which is adversely effected due to economic slowdown and scams. Future Outlook Your Directors are of the opinion that new government's agenda of development and creating jobs for young generation will stimulate the growth. Considering the huge population and change in consumers' spending pattern, Indian economy is bound to grow in coming years. Loans, Guarantees and investments The Company has not given any loan or guarantee. The Company has made investments in shares and commercial properties details of which are provided in the financial statements. Public Deposits Your Company has not accepted any deposit from the public, its shareholders or employees during the year under review. Conservation of Energy etc. Information pertaining to conservation of energy, technology absorption and foreign exchange earning and outgo as required under the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with the rules made thereunder, are as under a) Conservation of Energy: All machinery and equipment are periodically serviced and overhauled to keep them in good condition. This helps in consumption of lesser energy. Considering the minimal utilization of power, the Company has not opted for alternate energy source. B)Technology Absorption: The Company has not imported any technology. The nature of activities of the Company does not warrant any exclusive R&D. c)Foreign Exchange Earnings and Outgo: Earnings-Rs NIL Outgo - Rs 10672260/- (Import of machinery) Corporate Governance In line with the requirement of the Companies Act,2013 as also amended Clause 49 of the Listing Agreement, the Board of Directors has constituted new committees. Details of these committees along with their terms of reference, composition and meetings held during the year, are provided in the Corporate Governance Report. During the year the Company has also amended the existing policies and adopted new policies such as CSR policies, Related Party Transaction Policies, Whistle Blower Policies. A separate report on Corporate Governance is annexed, which forms part of this report. A certificate of CEO and CFO of the Company confirming the correctness of the financial and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee is also annexed and forms part of this Directors' Report. Transactions with related parties None of the transactions with related parties falls under the scope of Section 188(1) of the Companies Act, 2013. Information on transactions with related parties pursuant to Section 134 (3)(h) of the Act read with rule 8(2) of the , Companies (Accounts) Rules,2014 are given in Annexure 2 in Form AOC-2 and the same forms part of this report. The Company does not have any subsidiary. SUBSIDIARY COMPANIES Your Company does not have any subsidiary. Niktin Properties & Estates Pvt. Ltd. in which your Company is holding 39.41% of its share capital, is the Associate and in pursuance to the provisions of Section 2(6) of the Companies Act, 2013. A separate section on the performance and financial position of this associate in Form AOC-1 is part of thisreport. CONSOLIDATED FINANCIAL STATEMENTS In accordance with the Accounting Standards 21, 23 and 27 issued by the Institute of Chartered Accountants of India, consolidated financial accounts prepared on the basis of financial statements of the associate company forms part of this report and accounts. MATERIAL CHANGES AND COMMITMENT There was no material change and commitments affecting the financial position of the Company between the end of the financial year and the date of this report. Directors and key managerial personnel Your Directors regret to inform the sad demise of Mr. Brijlal S. Bachani on 31" October, 2014. Mr. Bachani was associated with your Company since it became public in the year 1995 (27-01-1995). Your Directors place on record their appreciation for the valued guidance of Mr. Bachani to the Company during his tenure with the Company. The Board in its meeting held on 14* March,2015 had appointed Mrs. Kavita Hingorani as an Additional Director. The Board also in its meeting held on 27* April, 2015 had appointed Mrs. Roopa Teckchandani as an Additional Director (Independent). Pursuant to the provisions of Section 161 of the Act, both Mrs. Kavita Hingorani and Mrs. Roopa Teckchandani would be vacating their office as Directors in the forthcoming Annual General Meeting. The Company has received notices under Section 160 of the Act alongwith refundable deposit of the prescribed amount, proposing the appointments of Mrs. Hingorani as Director and Mrs. Roopa Teckchandani as an Independent Director. Both the proposed appointments of Mrs. Hingorani and Mrs. Roopa Teckchandani were recommended by the Nomination & Remuneration Committee. The Board of Directors of the Company had formed the opinion that Mrs. Roopa Teckchandani meets with the criteria of Independence as per Section 149(6) of the Act and rules made thereunder and requirements of Clause 49 of the listing agreement with the BSE Ltd. Mr. Narain Hingorani shall retire by rotation at the forthcoming Annual General Meeting and being eligible has offered himself for re-appointment. During the year under review, none of the non-executive directors had any pecuniary relationship or transactions with the Company. Pursuant to the provisions of Section 203 of the Companies Act, 2013 and Clause 49 of the listing agreement with the BSE Ltd. Mr. Narain Hingorani, Managing Director of the Company is Chief Executive Officer, and Mr. Prakash Dhumal is the Chief Finance Officer. The Company is in search of an ideal candidate for the post of the Company Secretary. Nomination & Remuneration Policy The Nomination and Remuneration Policy recommended by the Nomination & Remuneration Committee is duly approved and adopted by the Board of Directors. The said policy is annexed to the report as Annexure I. Number of meeting of the Board Eight meetings of the Board were held during the year under review. Corporate Governance Report, which forms part of this report, contains the details about the Board meeting as also meeting attended by each Directors of the Company. Declaration of Independence All the independent directors have submitted declarations as required pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6) of the Act. Board evaluation Pursuant to the provisions of the Act and Clause 49 of the Listing Agreement with the BSE Ltd., the Board of Directors had done the annual evaluation of its own performance, its committees and individual directors. The Nomination and Remuneration Committee reviewed the performance of the individual directors on the basis of criteria such as the contribution of the individual director to the Board and committee meetings. In a separate meeting of independent directors, performance of non-independent directors, performance of the Board as a whole was evaluated, taking into account the views of the management and non-executive directors. Policy on appointment of directors and remuneration as provided in Section 178(3) of the Companies Act,2013 has been dealt with in the corporate governance report, which forms part of the Directors' Report. Audit Committee The details pertaining to composition of audit committee are included in the Corporate Governance Report, which forms part of this report. Internal Control System Adequate internal control systems are in place to maintain quality of product, proper accounting as per norms and standards laid prescribed, asset maintenance and its proper use. The Company has an independent internal auditor, who periodically reviews the accounts and reports to the Audit Committee. Risk Management The Company has Risk Management Committee. This committee is responsible for reviewing the risk management plan and its effectiveness. The audit committee also reviews the financial risk and its control. The management also continuously access the risk involved in the business and all out efforts are made to mitigate the risk with appropriate action. All the assets of the Company are adequately covered by comprehensive insurance. Employees The relations between the management and employees remained cordial through out the year. 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 appended to this report as Annexure 3 and forms part of this report. None of the employees was in receipt of the remuneration exceeding the prescribed limit and hence, information under the Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,2014 are not given. Auditors: According to Directors, there is no adverse remarks made by Statutory Auditors in their report. Notes to the accounts are serf explanatory to comments/observation made by the auditors in their report. Hence, no separate explanation is given. M/s. Udayavar Dhaneshkumar & Associates, Chartered Accountants, Statutory Auditors of your Company shall retire at the forthcoming Annual General Meeting. However, they are eligible for reappointment. Members are requested to appoint the Auditors and fix their remuneration. During the year, Secretarial Audit was carried out by Mr. Upendra C. Shukla, Practising Company Secretary for the financial year 2014-15. The report on the Secretarial Audit is appended as Annexure 5 to this report. According to the Board of Directors the report does not have any adverse remark. REPORTING OF FRAUD The Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013. Extract of Annual Return An extract of Annual Return in Form MGT-9 in pursuance to the provisions of Section 92(3) of the Companies Act,2013 is annexed to this report as Annexure 4 and forms part of this report. Corporate Social Responsibility (CSR): Since the profitability of the Company is below the limit prescribed under Section 135 of the Companies Act,2015, the provisions pertaining to Corporate Social Responsibility are not attracted. Vigil Mechanism The Company has a vigil mechanism policy to deal with instances of fraud and mismanagement. The whistle blower policy adopted by the Board of Directors is hosted on the website of the Company. Details of Significant and Material Orders passed by the Regulators or Court or Tribunals During the year under review, there were no material and significant orders passed by any of the regulators or courts or tribunals impacting the going concern status and the Company's operations. Disclosure under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 In compliance to the new Act of 'Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, your Company has duly constituted an internal complaint committee. The Committee has formulated policy to ensure protection to its female employees. Cautionary Statement Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis may constitute forward looking statements within the meaning of applicable laws and regulations. Although the expectations are based on the reasonable assumption, the actual results might differ. Acknowledgement: The Directors wish to place on record their deep sense of appreciation to the Company's Bankers and all the staff members for their unstinted support. Your directors also wish to thank the shareholders for confidence reposed in the management of the Company. For & on behalf of the Board of Directors (Narain N. Hingorani) Chairman & Managing Director Place: Mumbai Date: 14/11/2015 |