DIRECTORS' REPORT TO THE MEMBERS Your Directors have pleasure in presenting the 11th Annual Report of the Company and the Annual Accounts for the year ended 31st March, 2015. PERFORMANCE REVIEW Net revenue from operations increased to Rs. 72,033.46 Lacs as against Rs. 66,990.45 Lacs in the previous year - a growth of 7.53%. Earnings per Share (EPS) of Rs. 4.17 for the Financial Year ended March 31, 2015. We continue to spend a significant amount of time articulating our strategy for enhancing sales and marketing. Our strategic planning and implementation is directed towards resource optimization, technology updation, enhancing product and delivery excellence as well as identifying business and better customer service opportunities. Your company had coupled with high level of modernization, concentrated efforts of both Management and dedicated employees, the whole hearted support of Banks, suppliers and customers attained these levels of performance. There are no material changes and commitments affecting the financial position of your Company which have occurred between the end of the financial year 2014-15 and the date of this Report. DIVIDEND In view of conserving resources of the Company for future plan and to strengthen its fund and liquid position, Directors are unable to recommend any dividend. DIRECTORS' RESPOSIBILITY STATEMENT In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that: a. In the preparation of the annual accounts, the applicable accounting standards have been followed. b. The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the Company for the year under review. c. The directors 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. The directors have prepared the annual accounts on a going concern basis. 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 system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. CORPORATE GOVERNANCE As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report, Management Discussion and Analysis, and the Auditor’s Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report. Your Company is fully compliant with the Corporate Governance guidelines, as laid out in Clause 49 of the Listing Agreement. All the Directors (and also the members of the Senior Management) have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company. LISTING INFORMATION CORPORATE GOVERNANCE As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the Corporate Governance Report, Management Discussion and Analysis, and the Auditor's Certificate regarding compliance of conditions of Corporate Governance, form part of the Annual Report. Your Company is fully compliant with the Corporate Governance guidelines, as laid out in Clause 49 of the Listing Agreement. All the Directors (and also the members of the Senior Management) have affirmed in writing their compliance with and adherence to the Code of Conduct adopted by the Company. LISTING INFORMATION The Equity Shares in the Company are in dematerialized form and is listed with Bombay Stock Exchange Limited and National Stock Exchange of India Limited. The Listing Fee has been paid to the Stock Exchanges for the year 2015-16. The ISIN No. of the Company is INE297H01019. CREDIT RATING Credit Analysis & Research Ltd (hereinafter referred to as "CARE") has assigned grade BBB+ for credit rating of Term Loan and Grade A2 for working capital facilities. FIXED DEPOSITS The Company has not accepted any fixed deposits during the year to which the provisions of Section 58A of Companies Act, 1956 and Section 73 of the Companies Act, 2013 are applicable. AUDITORS & AUDITORS' REPORT M/s. A. K. Meharia & Associates, Chartered Accountants, statutory auditors of the Company was reappointed as the Auditors of the Company at the previous Annual General Meeting. As per the provisions of Section 139 of the Companies Act, 2013, Statutory Auditors of the Company hold office until the conclusion of the 5 years. Necessary certificate has been obtained from the Auditors as per Section 139(1) of the Companies Act, 2013. The notes on accounts referred to the Auditors' Report are self-explanatory and therefore, do not call for any further explanation. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO The information required under section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is annexed as Annexure-A to this Directors' report. COST AUDIT The Company has submitted the Cost Audit Report and Cost Compliance Report for the year 2013-14 duly certified by a Cost Accountant to the Central Government within the due date. M/s. U. Tiwari & Associates, Cost Accountants were appointed with the approval of the Central Government to carry out the cost audit in respect of the Company for the financial year 2014-15. Based on the recommendation of the Audit Committee, M/s. U. Tiwari & Associates, Cost Accountants being eligible have also been appointed by the Board as the Cost Auditors for the financial year 2015-16. FINANCE AND ACCOUNTS DETAILS ON INTERNAL FINANCIAL CONTROLS RELATED TO FINANCIAL STATEMENTS Your Company has put in place adequate internal financial controls with reference to the financial statements, some of which are outlined below: Your Company has adopted accounting policies which are in line with the Accounting Standards prescribed in the Companies (Accounting Standards) Rules, 2006 that continue to apply under Section 133 and other applicable provisions, if any, of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 and relevant provisions of the Companies Act, 1956, to the extent applicable. These are in accordance with generally accepted accounting principles in India. Your Company has a robust financial closure self-certification mechanism wherein the line managers certify adherence to various accounting policies, accounting hygiene and accuracy of provisions and other estimates. OUTLOOK AND EXPANSION Despite stiff competition from other steel manufactures our buyers show preference to your company's products for its quality and timely delivery and hence your Directors are confident of achieving better working results in the coming years. The Real Estate sector is showing more strength and hence business improvement is on the upswing. Your company plans to take the performance to the next level by modernization, installing high tech and time saving machinery and supportive systems, improving quality of work by employee training. Expansion Project: The expansion plan by further investment in installation of new capacities and technology upgradation and modern machinery for increasing the capacity of the existing Units are being implemented. AWARD AND RECOGNITIONS During the year, Company has not received awards and recognition. INSURANCE All the insurable interests of your Company including inventories, buildings, plant and machinery and liabilities under legislative enactments are adequately insured. PERSONNEL, INDUSTRIAL RELATIONS AND MARKETING Industrial relations are cordial and satisfactory. Your Company sustained harmonious and healthy industrial relations in manufacturing plants and other business establishment and offices which set the trend in employee productivity, workforce flexibility and continuous introduction of technology. The Company's HR philosophy is to establish and build a high performing organization, where each individual is motivated to perform to the fullest capacity, to contribute to developing and achieving individual excellence and departmental objectives and continuously improve performance to realize the full potential of our personnel. The Company is giving employment to 539 employees. BOARD OF DIRECTORS AND SENIOR EXECUTIVE In terms of Sections 149, 152, Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, the Independent Directors can hold office for a term of up to five (5) consecutive years on the Board of Directors of your Company and are not liable to retire by rotation. In terms of Sections 149, 152, Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, Mrs. Richa Bhartiya has been appointed as Independent Woman Director. She can hold office for a term of upto five consecutive years on the Board of Directors of your Company and are not liable to retire by rotation. The Board of Directors comprises of Eight Directors of which four are Independent Directors. In terms Section 152 of the Companies Act, 2013, Mr. Nitin M Kandoi, liable to retire by rotation at the ensuing Annual General Meeting and eligible for re-election. At their Meeting held on 28.08.2015, Board of Directors has re-appointed Mr. Chandra Prakash Agrawal as a Managing Director for a period of five years effective from 01.09.2015 on the terms and conditions as embodied in the agreement dated 28.08.2015. This appointment is subject to the approval of the shareholders. At the same Meeting, Mr. Dinesh Kumar Raghubir Prasad Agarwal has been appointed as a Whole time Director for a period of five years effective from 01.11.2015 on the terms and conditions as embodied in the agreement dated 28.08.2015. This appointment is subject to the approval of the shareholders. TRANSFER TO RESERVES Your Directors propose to transfer Rs. 3,394.89 Lacs to the General Reserve. INTERNAL COMPLAINT REGARDING SEXUAL HARRASSMENT There were no cases of sexual harassment of woman at work place. Also, there are no instances of child labour/ forced labour/ involuntary labour and discriminatory employment during the year. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 The particulars of loans, guarantees and investments u/s 186 of the Companies Act, 2013: During the year Company has not given loan and guarantee also no fresh investment was made in the other body corporate. MANAGEMENT DISCUSSION AND ANALYSIS REPORT The Management Discussion and Analysis Report are annexed herewith as Annexure-B. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR In the last Annual General Meeting held on September 09, 2014, appointment of Mr. Jyotirindra Nath Dey, Mr. Rajesh Kumar Jain, Mr. Prasant Kankrania and Ramesh Kumar Choudhary were aligned as per the Companies Act, 2013. Mr. Rajesh Kumar Jain resigned from the Directorship of the Company with effect from November 12, 2014. Effective from the same date, Mrs. Richa Bhartiya appointed as an Additional Director. She qualifies to be an Independent Director as per the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement. All the Independent Directors have given declarations that they meet the criteria required under section 149(6) of the Companies Act, 2013. Mr. Sandip Kumar Agarwal was appointed as a Chief Financial Officer of the Company effective from August 14, 2014. NUMBER OF MEETINGS OF BOARD AND AUDIT COMMITTEE HELD DURING THE YEAR 2014-2015 The details of the number of Board and Audit Committee meetings of your Company are set out in the Corporate Governance Report which forms part of this Report. DETAILS OF POLICIES (i) Nomination and 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. The Company's Remuneration Policy is available on the Company's website www.gallantt.com <http://www.gallantt.com> and the same is attached herewith as Annexure - C. (ii) Corporate Social Responsibility Policy (CSR) The Board has, on the recommendation of the CSR Committee, approved the CSR Policy. The Company's CSR Policy is available on the Company's website www.gallantt.com <http://www.gallantt.com> and the same is attached herewith as Annexure-D. Annual Report on CSR as required under Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is also attached herewith as Annexure-E. (iii) Risk Management Policy Business Risk Evaluation and Management is an ongoing process within the Organization. Pursuant to Section 134(3)(n) of the Companies Act, 2013, the Board has framed a Risk Management Policy for the Company. The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis. At present the company has not identified any element of risk which may threaten the business (or) existence of the company. (iv) Whistle Blower Policy - Vigil Mechanism Your Company has formulated a Vigil Mechanism Policy with a view to provide a mechanism for employees and directors of the Company to approach the Chairman of the Audit Committee to ensure adequate safeguards against victimisation. This policy would help to create an environment wherein individuals feel free and secure to raise an alarm, whenever any fraudulent activity takes place or is likely to take place. It will also ensure that complainant(s) are protected from retribution, whether within or outside the organization. The Board has elected Mr. Rajesh Upadhyaya, Company Secretary as the Whistle Officer under the vigil mechanism policy. The details of establishment of the Vigil Mechanism Policy is displayed on the website of the Company www.gallantt.com <http://www.gallantt.com> under the weblink : <http://goo.gl/5APCbx> BOARD COMMITTEES Details ofAudit Committee, Nomination & Remuneration Committee, Stakeholders' Relationship Committee and Corporate Social Responsibility Committee have been disclosed under Corporate Governance Report. DETAILS OF RECOMMENDATIONS OF AUDIT COMMITTEE WHICH WERE NOT ACCEPTED BY THE BOARD ALONG WITH REASONS The same is not applicable as the Audit Committee's recommendations were accepted and implemented by the Board. NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR - Company does not have Subsidiary Company. SECRETARIAL AUDITORS Ms. Khushboo Goenka, Practising Company Secretary, having office address at 204, Ram Krishna Samadhi Road, 1st Floor, Kolkata - 700054 has been appointed as Secretarial Auditors of the Company for the FY ended 31.03.2015. The Secretarial audit report received from the Secretarial Auditors is annexed to this report marked as Annexure - F and forms part of this report. RELATED PARTY TRANSACTIONS The details of Related Party Transactions during the Financial Year ending 31.03.2015, being arm's length transactions have been reported in the financial statements and forms part of this report. The Audit Committee and the Board of Directors of the Company have formulated the Policy on dealing with RPTs and a Policy on materiality of RPTs which is uploaded on the website of the Company and can be accessed through the website of the Company www.gallantt.com <http://www.gallantt.com> under the weblink : <http://goo.gl/3lJuKK> PARTICULARS OF EMPLOYEES Particulars of Employees and Related disclosures No employee of the Company is covered under the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, MANAGERIAL REMUNERATION Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as under: (a) ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year; PERFORMANCE EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the equity listing Agreement, the Board has carried out the annual performance evaluation of the Directors individually as well as evaluation of the working of the Board and of the Committees of the Board, by way of individual and collective feedback from Directors. Pursuant to Para VII of Schedule IV of the Companies Act, 2013 and Clause 49(II)(B)(6) of the Equity Listing Agreement, a meeting of the Independent Directors of the Company was convened to perform the following: Review the performance of non-independent directors and the Board as a whole; Review the performance of the Chairperson of the Company, taking into account the views of executive directors and nonexecutive directors; Assess the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties. Further, the Nomination and Remuneration Committee also evaluated the performance of all the directors of the Company. The criteria for evaluation are briefly provided below: Role & Accountability - Understanding the nature and role of Independent Directors' position. - Understanding of risks associated with the business. - Application of knowledge for rendering advice to management for resolution of business issues. - Offer constructive challenge to management strategies and proposals. - Active engagement with the management and attentiveness to progress of decisions taken. Objectivity - Non-partisan appraisal of issues. - Own recommendations given professionally without tending to majority or popular views. Leadership & Initiative - Heading Board Sub-committees. - Driving any function or identified initiative based on domain knowledge and experience. Personal Attributes - Commitment to role & fiduciary responsibilities as a Board member. - Attendance and active participation. - Proactive, strategic and lateral thinking. FAMILIARISATION PROGRAMME Your Company follows a structured orientation and familiarization programme through various reports/ codes/internal policies for all the Directors with a view to update them on the Company's policies and procedures on a regular basis. Periodic presentations are made at the Board Meetings on business and performance, long term strategy, initiatives and risks involved. The details of familiarisation programme have been posted in the website of the Company www.gallantt <http://www.gallantt>. com under the weblink : <http://goo.gl/xk90w2> CODE OF CONDUCT Your Company has adopted a Code of Conduct for members of the Board (incorporating duties of Independent Directors) and the Senior Management. The Code aims at ensuring consistent standards of conduct and ethical business practices across the Company. Your Company has received confirmations from all concerned regarding their adherence to the said Code. Pursuant to Clause 49(II)(E) of the Listing Agreement, the Managing Director of the Company confirmed compliance with the Code by all members of the Board and the Senior Management. The full text of the Code is hosted on the Company's website www.gallantt.com <http://www.gallantt.com> under the weblink : <http://goo.gl/zc9dNe> CODE OF CONDUCT FOR PROHIBITION OF INSIDER TRADING Your Company has adopted a Code of Conduct as per Securities and Exchange Board of India (SEBI) (Prohibition of Insider Trading) Regulations, 1992. All Directors, Designated Employees who could have access to the Unpublished Price Sensitive Information of the Company are governed by the Code. During the year under review, there has been due compliance with SEBI (Prohibition of Insider Trading) Regulations, 1992. Gallantt Metal Limited - Code for Fair Disclosure' are available on the Company's website www.gallantt.com <http://www.gallantt.com> under the weblink : <http://goo.gl/OMZ5EQ> MATERIAL CHANGES AND COMMITMENTS There have been no material changes and commitments affecting the financial position of the Company since the close of financial year i.e. since 31st March, 2015 till the date of this Report. Further, it is hereby confirmed that there has been no change in the nature of business of the Company. Significant and material orders passed by the regulators / courts / tribunals impacting the going concern status and the Company's operations in future As such there is no significant and material order by the regulator/court/tribunals impacting the going concern status and the Company's operation in future. EXTRACT OF ANNUAL RETURN The details forming part of the extract of Annual Return in Form MGT-9 is attached on Annexure-G. DECLARATION OF INDEPENDENCE Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued there under as well as Clause 49 of the Listing Agreement. GENERAL a) Your Company has not issued equity shares with differential rights as to dividend, voting or otherwise; and b) Your Company does not have any ESOP scheme for its employees/Directors. ACKNOWLEDGEMENT Your Directors wish to place on record their appreciation for the whole hearted and sincere co-operation the Company has received from its customers, shareholders, vendors, bankers, business associates, regulatory and government authorities for their continued support. On behalf of the Board C. P. Agrawal Chairman Place: Kolkata Date: August 28, 2015 |