DIRECTORS' REPORT Dear Members, Your Directors have pleasure in presenting this 54th Annual Report together with the Audited Statements of Accounts for the year ended on 31st March, 2015. DIVIDEND Your company has not operated and has not registered any sales during the year under review. Hence, with a view to conserve the resources, the board of directors of the company have not recommended any dividend for the year under review. PERFORMANCE During the year, as the Company is not operating any business there is no sales and purchases under consideration. Company has earned the income from other sources amounting to Rs. 20.02Lakh as compared to last year of Rs. 20.15 Lakh. Further the profit of company after tax is Rs.7.33 Lakh as compared to last year of Rs .5.39 Lakh. However your Director are pleased to inform you that Equity shares of the company had got the listing approval from Bombay Stock Exchange Limited on 15.04.2015. Now the equity shares of the company are listed and traded at BSE with scrip code 539121. PERFORMANCE OF SUBSIDIARIES AND ASSOCIATES: Company is holding investment in Equity Shares of Palco Recycle Industries Limited. Palco Recycle Industries Limited has achieved the sales of Rs. 80, 14, 43,437 (-5.8% as compared to last year) as against the sales of 85, 10, 45, 001/- (YOY). Profit before tax comes to Rs. 29,68,978 as against the Rs. 57,77,128 of the last year. Net profit after tax comes to Rs. 11,27,822/- as against the profit of 47,15,406 of last year. NAME OF THE COMPANIES WHICH HAVE CEASED TO BE ASSOCIATES DURING THE YEAR: SFC Metallurgical Limited was ceased to be associate of the company during the year as the company has sold its investment in the same. FUTURE PROSPECTS Your Company is craving for opportunity, of marketing tie ups, with manufacturers, for sale of aluminum ingots, wire rods, etc. DEPOSITS The Company has not invited / accepted any deposits from the public under the provisions of Section 73 of the Companies Act, 2013 and rules made there under. BOAD MEETING AND BOARD EVALUATION The Board met 11 times during the financial year 2014-15, the details of which are given in the Corporate Governance Report. Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually and the Committees viz., Audit, Nomination & Remuneration, Stakeholders Relationship and Risk Management. A structured questionnaire was prepared after taking into consideration the inputs received from the Directors covering various aspects such as attendance, quality contributions to Board deliberations, providing perspectives and feedback going beyond the information provided by the management, commitment to shareholder and other stakeholders interests etc. A separate exercise was carried out to evaluate the performance of individual directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interests of the Company and its minority shareholders etc. The performance evaluation of Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors at their meeting held separately. DIRECTORS & KEY MANAGERIAL PERSONAL A) DIRECTORS During the year under review, Mrs. Rakhi Jitendra Agrawal (DIN: 07021709) was appointed as an Additional Director of the Company with effect from 26th March, 2015. It is proposed to appoint her as Woman Independent Director of the Company, at the Annual General Meeting. In accordance with the provisions of section 152 of the Companies Act, 2013 read with Articles of Association of company Mr. Kanaiyalal Agrawal (DIN: 00594240), Director retires by rotation at the forthcoming Annual General meeting and being eligible offers himself for reappointment. The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. In accordance with the provisions of Section 178 and section 134 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the performance of Committees of the Board, namely, Audit Committee, Risk Management Committee, Stakeholders Relationship Committee and Nomination and Remuneration Committee and also the directors individually. The manner in which the evaluation was carried out and the process adopted has been mentioned in the Corporate Governance Report. The Board, on the recommendation of the Nomination & Remuneration Committee, has framed a policy for selection and appointment of Directors, Senior Management and their remuneration and also framed the criteria for determining qualifications, positive attributes and independence of directors. The Nomination and Remuneration Policy setting out the policy of Boards and Senior management remuneration and criteria for Board nominations are given in the Corporate Governance Report forming part of the Annual Report. The particulars of the directors retiring by rotation are given in the notice / explanatory statement portion of the accompanying notice. B) KEY MANAGERIAL PERSONAL During the year under review and with approval of the Board of Directors of the Company Mr. Gaurav Pushkarbhai Jani is appointed as a Company Secretary of the Company on 6th December 2014. Gaurav Jani tendered his resignation and on his resignation Ms. Nisha Agrawal is appointed as a Company Secretary of the Company with effect from 09th June 2015 and Mr. Badal Naredi is appointed as a Chief Financial Officer of the Company with effect from 09th June 2015. CORPORATE GOVERNANCE REPORT The Report on corporate governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49 is attached to the Report on corporate governance. LISTING OF SECURITIES: Your company has applied for listing of securities at Bombay Stock Exchange limited on 29/11/2014 and as a result of which in principal approval for listing of securities from the Bombay stock Exchange was received with effect from 15th April, 2015. The Equity shares of company are traded on Bombay Stock Exchange 4th May, 2015. The Securities of your Company are listed at Bombay Stock Exchange Limited, Ahmedabad Stock Exchange Limited. The Company has been generally regular in complying with the provisions of the Listing Agreement. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement under Section 134(5) of the Companies Act, 2013 with respect to Directors' Responsibility Statement, it is hereby confirmed that: > in the preparation of the annual accounts for the financial year ended March 31, 2015, the applicable accounting standards have been followed and there are no material departures from the same; > the Directors have selected such accounting policies and applied them consistently and made judgements and estimates 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 loss of the Company for the year ended on that date; > the Directors have taken proper and sufficient care 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; > The Directors have prepared the Annual Accounts on a going concern basis. > The Directors have laid down proper internal financial controls to be followed by the Company and such controls are adequate and operating effectively. > the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. STATUTORY AUDITORS M/s. Rahul Kakani & Associates, Chartered Accountants (Reg. No. 130198W), Ahmedabad, Auditors of the Company hold office until the conclusion of the 58th Annual General Meeting. The Company has received a letter to the effect that their appointment would be within the prescribed limits under Section 141(3)(g) of the companies Act, 2013. The Board hereby requests the members to ratify the appointment of M/s. Rahul Kakani & Associates, Chartered Accountants, Ahmedabad as the Auditors of the Company from the conclusion of this Annual General Meeting till the conclusion of next Annual General Meeting. Your Directors request you to appoint Auditors as proposed and as set out in the accompanying notice of the Annual General Meeting. No qualification or adverse remark is put by the auditor in their report dated 25th May, 2015. SECRETARIAL AUDIT According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2013, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report Annexure-A. Qualifications in the report are general and self explanatory in nature. As per the remark Company has not appointed the Chief Financial Officer of the companyRs. in Secretarial Audit Report, the Board herewith comments that the company was in search of suitable candidate as per its requirements and on getting the same candidate Board in its meeting dated 17th June 2015 Company appointed Mr. Badal Naredi as CFO of the company w.e.f 9th June, 2015. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-B. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements. REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES: There is no employee drawing remuneration for which information is required to be submitted under The Companies (Particulars of Employees) Rules, 1975 as amended, hence not given. Further at present the company is not in operations and has very few employees on its payroll. Details of the remuneration given to Whole time Director and Company Secretary only KMP in the company is given in the Form MGT 9 annexed as Annexure B to the report. Further there are no other employees on the pay roll of the company. RELATED PARTY TRANSACTIONS All the transactions entered with related party for the year under review were on arms length basis and in the ordinary course of business and that the provision of section 188 of the Companies Act, 2013 are not attracted. Further there are no material related party transactions with the promoters, Directors, KMP. The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and the Listing Agreement. All the related party transaction are placed before the Audit committee as also to the Board for approval. This Policy was considered and approved by the Board has been uploaded on the Company's website www.palcometals.com . VIGIL MECHANISM In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a vigil mechanism for directors and employees to report genuine concerns has been established. The same has been posted on the Company's website www.palcometals.com and the details of the same are given in the Corporate Governance Report RISK MANAGEMENT As required under Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board's Report. The Company has a mechanism to identify, assess, monitor and mitigate various risks to its key business objectives. Major risks identified by the business and functions are systematically addressed through mitigating actions on a continuing basis. The Company has formulated a Risk Management Policy which is also available on the Company's website at www.palcometals.com . CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGO ETC The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 and Management Disccussion and Analysis Report as required in Clause 49 of the listing agreement is furnished in Annexure c and is attached to this report. RISK MANAGEMENT The company has formed the Risk Management Committee consisting of Mr. Kanaiyalal Agrawal, Whole Time Executive Director and Mr. Kirankumar agrawal Non - Executive Director. Further company has framed the risk management policy which identifies the areas of risks including the risks that threaten the existence of company and develops the measures to mitigate the risks in the areas. Risk Management committee further reviews the implementation of risk management policy. CORPORATE SOCIAL RESPONSIBILITY (CSR) Section 135 of the Companies Act, 2013 provides the threshold limit for applicability of the CSR to a Company i.e. (a) net worth of the Company to be Rs. 500 crore or more; or (b) turnover of the company to be Rs. 1,000 crore or more; or (c) net profit of the company to be Rs. 5 crore or more. As the Company does not fall under any of the threshold limits given above, the provisions of Section 135 are not applicable to the Company. CORPORATE GOVERNANCE The Report on corporate governance as stipulated under the Listing Agreement forms part of this Report. The requisite certificate from M/s Rahul kakani & Associates, Chartered Accountant confirming compliance with the conditions of corporate governance is attached to the Corporate Governance Report. The report also contains the details as required to be provided on Board evaluation, remuneration policy, implementation of risk management policy, whistle blower policy/vigil mechanism etc. The Managing Director and the Chief Financial Officer have submitted a certificate to the Board regarding the financial statements and other matters as required under the Listing Agreement. APPRECIATION Your Directors wish to place on record their deep appreciation of the continued support and guidance provided by the Central and State Governments and all Regulatory bodies. Your Directors also take opportunity to thanks the esteemed shareholders, customers, business associates, and Company's Banks for the faith reposed by them in your Company and its management. Your Directors place on record their deep appreciation of the dedication and commitment of your Company's employees at all levels and look forward to their support in the future as well. By Order of the Board of Directors Sd\- Kailashchandra Agrawal Chairman Sd\- Kirankumar Agrawal Director Sd\- Kanaiyalal Agrawal Whole Time Director Date : 14th August,2015 Place: Ahmedabad |