DIRECTORS' REPORT To the Members, Your Directors are pleased to present the 4" Annual Report and Audited Financial Statements for the year ended 31st March 2015, together with the Auditors' Report thereon. Financial Performance and State of the Company's Affairs Consolidated On Consolidated basis, the Total Revenue was maintained at Rs. 3885.99 Crore as against Rs. 3748.07 Crore in Financial Year 2013-14. The Profit after Tax in Financial Year 2014-15 was higher at Rs.. 21.79 crore as compared to Rs. 18.37 Crore last year Standalone On Standalone basis, the Total Revenue stood Rs. 7.03 Crore in Financial Year 2014-15, as against Rs. 5.12 Crores in Financial Year 2013-14. Details of State of the Company's Affairs are given in the Management Discussion and Analysis, forms an integral part of this report. Dividend & Reserves Your Directors did not recommend any dividend for the financial year 2014-15 and not proposed to carry any amounts to reserves. Change in the Nature of the Business During the year under review, there was no change in the nature of the business of your Company Change in Share Capital During the Financial Year 2014-15, the Authorized Share Capital has been increased from Rs.50,00,000 to Rs. 27,00,00,000 and Paid Up Share Capital of the Company has been increased from Rs. 5,00,000 to Rs, 26,04,67,240, pursuant to allotment of 2,59,96,724 Equity Shares of Rs.10/- each under the Scheme of Demerger approved by the Hon'ble High Court of Delhi. Deposits Your Company has not accepted any deposits from the Public or Shareholders during the year, nor has any unclaimed or unpaid deposits at the end of the financial year 2014-15. Number of Meetings of the Board The Board met five times during the financial year, the details of which are given in the Corporate Governance report that forms part of this Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and Listing Agreement. Directors' Responsibility Statement Pursuant to the requirement under Section 134 (5) of the Companies Act, 2013, with respect to Directors Responsibility Statement, your Directors state that: a) in the preparation of the annual accounts for the financial year ended 31st March 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures; b) the Directors 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 31st March, 2015 and of the loss of the Company for that period; c) 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; d) the Directors have prepared the annual accounts on a 'going concern' basis; e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and f) 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 Declaration from Independent Directors All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. Policy on Directors' Appointment and Remuneration (Sec 178(4)) The Company had already constituted Nomination and Remuneration Committee as required under Sub-Section (1) of Section 178 of the Companies Act, 2013 comprising three Independent Directors Mr. Ashok Kumar Sanghi, Chairman, Mr. Ashok Kumar Chhabra and Dr. A P Bhupatkar, Members of the Committee. The Company has also formulated a Policy on directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Section 178 (3) of the Companies Act, 2013 and the same is annexed as Annexure-/with this report. Board Evaluation Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 and Clause 49 of the Listing Agreement states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. The evaluation of all the directors and the Board as a whole was conducted by the Board based on the criteria and framework generally followed in the industry. None of the Independent Directors are due for re-appointment. DIRECTORS AND KEY MANAGERIAL PERSONNEL Appointment: The Board appointed Mr. Ashok Kumar Sanghi, Mr. Ashok Kumar Chhabra and Dr. Ashutosh Prabhudas Bhupatkar as Independent Directors with effect from 26th May, 2014 and Mrs. Payel Seth as Managing Director with effect from 1st June, 2014. We thanks to the Shareholders for their support in confirming their appointment at the Annual General Meeting held on 26th September, 2014. The Board appointed Mr. Omprakash Makam Suryanarayan Setty as Chief Financial Officer and Mr. Mukesh Kumar as Company Secretary and Compliance Officer with effect from 26th May 2014. The Board appointed Mr. Chandra Kishore Jha as Company Secretary and Compliance Officer with effect from 27th January, 2015 in place of Mr. Mukesh Kumar, who resigned as Company Secretary with effect from 27" January, 2015. Re-appointment: In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of your Company, Mr. Pallak Seth, Directors and Vice-Chairman would retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment. Auditors In terms of Section 139 of the Companies Act, 2013, M/s S. R. Dinodia& Co. LLP Chartered Accountants, (Regn. No. 001478N/N500005), New Delhi, were appointed by the Members in its 3rd Annual General Meeting held on 26" September, 2014 as Statutory Auditors of the Company for a period of five years. A Resolution for ratification of their appointment as Statutory Auditors is proposed in the Notice calling the Annual General Meeting. Secretarial Auditor The Board has appointed Mr. Deepak Somaiya, Practicing Company Secretary, proprietor of M/s. Deepak Somaiya & Co., Company Secretary, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year 2014-15 is annexed herewith as Annexure-// Explanations or comments on every qualification, reservation or adverse remark or disclaimer: i. Required explanations or comments on every qualification, reservation or adverse remark or disclaimer, if any, made by the Auditors in their report are provided in the financials and notes to accounts. ii. Secretarial Audit Report made by Deepak Somaiya& Co do not contain any qualification, reservation or adverse remark or disclaimer and hence no explanations or comments by the Board is required to be disclosed. Internal Auditor The Board has appointed M/s. Aneja Associates, Chartered Accountants having firm registration number 100404W, as Internal Auditor for the financial year 2014-15. Internal Financial Controls Your Company has in place adequate internal financial controls with reference to financial statements and such internal financial controls are adequate and are operating effectively. MANAGEMENT Your Company has taken necessary steps for risk management including identifying risk which may threaten the existence/operations of the Company. Corporate Governance The Company is committed to maintain the highest standard of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on corporate governance as stipulated under the Listing Agreement forms and integral part of this Report. 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. Management Discussion and Analysis Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of Listing Agreement with the Stock Exchange inIndia, is presented in a separate section under the head "Management Discussion and Analysis"forming part of this Report. Audit Committee The Audit Committee comprises two Independent Directors, namely Dr. A P Bhupatkar, Chairman, Mr. Ashok Kumar Sanghi, Member and one non-executive Director, Mr. Deepak Seth, as Member of the Committee. All the recommendations made by the Audit Committee were accepted by the Board. Vigil Mechanism The Company has set up a Vigil Mechanism, which also incorporates a whistle blower policy in terms of the Listing Agreement. Protected disclosures can be made by whistle blower through an e-mail, or dedicated telephone no. or a letter through to the Vigilance Officer or to the Chairman of the Audit Committee. The policy on vigil mechanism and whistle blower policy may be accessed on the Company's website at www.pdsmultinational.com . During the year under review, no protected disclosure were made to the Company Corporate Social Responsibility The provisions of Section 135 of the Companies Act, 2013 are not applicable to your Company Consolidated Financial Statement In accordance with the Companies Act, 2013 and applicable Accounting Standards (AS), the audited consolidated financial statement is provided in the Annual Report. Subsidiaries, Joint Ventures and Associate Companies During the year under review, companies listed below have become or ceased to be Company's subsidiaries, joint ventures or associate companies. Companies which have become Subsidiaries during the financial year 2014-15 1. Techno Design GmbH 2. Poetic Brands Limited Companies which ceased to be subsidiaries during the financial year 2014-15 1. Propur Investment Limited There is no change in status of Associate Company and Joint Venture A statement containing the salient features of the financial statement of our subsidiaries, associates and joint venture companies as per the Companies Act, 2013 in the prescribed Form AOC-1 is appended as Annexure-III to this Report. In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and auditedaccounts of each of its subsidiaries, are available on our website www.pdsmultinational.com . The Policy of determining material subsidiaries as approved may be accessed on the Company's website at <http://www.pdsmultinational.com/code-conduct/> Particulars of Loans, Guarantees and Investments During the year under review, your Company neither gave any Loans, guarantees nor made investments which are covered under Section 186 of the Companies Act, 2013 MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF THE REPORT.- There were no Material Changes and Commitments affecting Financial Position between the end of the financial year and Date of the Report. Extracts of Annual Return Extract of Annual Return of the Company is annexed herewith as Annexure-IV to this Report. Particulars of Contracts or Arrangements with Related Parties Particulars of Contracts or Arrangements with Related Parties referred to in Section 188(1) of the Companies Act, 2013 in the prescribed Form AOC-2 is annexed as Annexure-V to this report. Particulars of Employees and Related Disclosures The table containing the names and other particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure- VI to this report. A Statement containing the names of every employee employed throughout the financial year and in receipt of remuneration of R. 60 lakh or more, or employed for part of the year and in receipt of X 5 lakh or more a month, under Rule 5(2) and (3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in enclosed as Annexure-VII to this report. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under Section 134(3)(m) is annexed as Annexure-V/// to this report. Details of Significant and Material Orders Passed by the Regulators or Courts or Tribunals Impacting the Going Concern Status and Company's Operations in Future No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future. Listing The equity shares of your Company is listed and traded w.e.f 21st October, 2014 on the National Stock Exchange of India Limited and BSE Limited under the Scheme of Demerger approved by the Hon'ble High Court of Delhi on 10"1 March, 2014. The listing fees to the Stock Exchanges for the year 2015-16 have been paid. Report On Sexual Harassment Pursuant to the provisions of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received during the financial year 2014-15. Green Initiatives Your Company started a sustainability initiative with the aim of going green and minimizing our impact on the environment. We are publishing only the statutory disclosures in the print version of Annual Report. Additional information is available on our website, www.pdsmultinational.com . Electronic copies of the Annual Report 2014-15 along with Notice of the 4th Annual General Meeting are sent to all members whose email addresses are registered with the Company/ RTA/Depository Participant(s). For members who have not registered their email addresses, physical copies of Annual Report 2014-15 and Notice of 4"1 Annual General Meeting are sent in the permitted mode. Members requiring physical copies can send a request to the Company Acknowledgement The Directors of your Company are thankful to Bankers, Business Associates, Customers, Members, Government Bodies & Regulators for the continuous support received from them and place on record their appreciation for the sincere services rendered by the employees at all level. By order of the Board of Directors for PDS Multinational Fashions Limited (DEEPAK SETH) Chairman Managing DIN No.00003021 (PAYEL SETH) Director DIN No.00003035 Place: Gurgaon Date : August 14, 2015 |