DIRECTORS’ REPORT Dear Shareholders, The Directors of your company take pleasure in presenting you the Twenty Fourth Annual Report and the Audited Accounts for the year ended 30th June 2015. DIVIDEND The Board of Directors do not recommend to pay a Dividend for the year ended 30th June 2015 in view of the accumulated losses. FUTURE OUTLOOK 1. Newsprint is being imported at "Nil" duty at very low rates due to dumping by foreign manufacturers and this has depressed the demand and prices of newsprint manufactured by Indian Paper Mills, thereby also affecting the demand of writing and printing paper as newsprint capacities are being diverted to writing and printing paper manufacture. 2. The installed capacity for writing and printing paper has increased significantly in the last four years, thereby affecting the demand as well as prices of the paper manufactured by your company. 3. Measures are being taken to save costs and rationalize operations, they are likely to yield positive results. SHARE CAPITAL The paid up Equity Share Capital as on 31st March, 2015 was Rs. 9,55,50,000/-. During the year under review, the Company has not issued any further shares. EXTRACTS OF ANNUAL RETURN As per requirements of provisions of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT9 is annexed hereto as Annexure 3 forming part of the report. NUMBER OF MEETINGS OF THE BOARD Details of number of meetings of Board of Directors and committees thereof and the attendance of the Directors in such meetings are provided under the Corporate Governance Report. The provisions of the Companies Act 2013 and listing agreement were adhered to while considering the time gap between two meetings. DIRECTORS' RESPONSIBILITY STATEMENT In compliance of Section 134 (5) of the Companies Act, 2013, your Directors wish to confirm that - i. In the preparation of the annual accounts, the applicable Accounting Standards have been followed. ii The Accounting Policies adopted are consistently followed and the judgments and estimates made 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/(Loss) of the Company for the year. iii The Directors have taken proper and sufficient care as warranted for the maintenance of adequate accounting records in accordance with the provisions of this Act in safeguarding the assets of the Company and for preventing/ detecting any incidence of frauds and other irregularities. iv The Annual Accounts have been prepared on a going concern basis. v. The Directors had laid down internal financial controls to be followed by the company and that such internal controls are adequate and were operating effectively vi. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. NOMINATION AND REMUNERATION COMMITTEE POLICY As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration Committee of directors was formed by the Board of Directors consisting of: 1. Sri K. Arumugam, Chairman (Non-Executive -Independent) 2. Sri P. Kanagavadivelu, Member (Non-Executive - Independent) 3. Sri P.C. Narendran, Member (Non-Executive - Independent) The said committee has been empowered and authorised to exercise widest power as entrusted under the provisions of Section 178 of the Companies Act, 2013. The Company has a policy on directors' appointment and remuneration including criteria for determining qualification, positive attributes, independence of a director and other matters provided under sub-section (3) of section 178. DECLATION BY INDEPENDENT DIRECTORS The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules. BOARD EVALUATION Pursuant to the provisions of the Companies Act 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own Performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholders committee. The Board of Directors expressed their satisfaction with the evaluation process. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY COMPANY 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. PARTICULARS OF CONTRACTS WITH RELATED PARTY All the transactions of the company with related parties are at arm's length and have taken place in the ordinary course of business. MATERIAL CHANGES There is no material change or commitments after closure of the financial year till the date of this report. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT Your Company has adopted appropriate standards for good Corporate Governance. All the mandatory provisions of Corporate Governance as prescribed under the amended Listing Agreements of the Stock Exchange, with which the Company is listed, are complied with. Report on Corporate Governance with Management Discussion and Analysis as required under the Listing Agreements with the Stock Exchange forms part of the Annual Report. In terms of sub-clause (v) of Clause 49 of Listing Agreement, certificate of the CEO, inter alia, confirming the correctness of the financial statements, adequacy of the internal control measures and reporting of matters to the Audit Committee in terms of the said Clause is also annexed as part of the said Report. A certificate from the auditors to this effect is annexed as part of the Corporate Governance Report. RISK MANAGEMENT The Company follows a comprehensive and integrated risk appraisal, mitigation and management process. The risk management process of the company is being periodically reviewed for improvement. None of the identified risk elements have any threat on the sustainability of the business. MANAGEMENT DISCUSSION AND ANALYSIS In accordance with the Companies Act 2013, the details of the Management analysis and datas are given in Annexure 2 DIRECTORS In accordance with the Companies Act, 2013, Smt. Selvambal Sengottu Velu is due to retire by rotation at the ensuing Annual General Meeting and being eligible offer herself for re-appointment. RE-APPOINTMENT OF INDEPENDENT DIRECTOR There was no incidence of re-appointment of Independent Director. RESIGNAION OF DIRECTOR: There was no incidence of resignation of Director. SECRETARIAL AUDIT CERTIFICATE Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed the Company Secretary in practice to undertake the Secretarial Audit of the company. The Report of the Secretarial Audit Report is annexed herewith as Annexure 4. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO The required details in accordance with section 134(m) of the Companies Act 2013 read with the Companies (Disclosure of particulars in the Report of Directors) Rules 1988 are given in Annexure-1 forming part of the report. PUBLIC DEPOSITS The company has not accepted Fixed Deposits from the public during the year under review. LISTING PARTICULARS The Equity Shares of the Company are listed on the Bombay Stock Exchange Ltd., Mumbai. The company has paid the listing fees to Bombay Stock Exchange up to 2015-16. DEPOSITORY SYSTEM As the members are aware, your company's shares are tradable compulsorily in electronic form and your company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the numerous advantages offered by the Depository system, members are requested to avail of the facility of dematerialization of the Company's shares on either of the Depositories as aforesaid. RELATED PARTY TRANSACTIONS All the related party transactions are entered on arm's length basis and are in compliance with the applicable provisions of the Act and the Listing Agreement. The disclosure is being made as a matter of prudence. All Related Party Transactions are presented to the Audit Committee and the Board and obtained approval for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on quarterly basis, specifying the nature, value and terms and conditions of the transactions. AUDITORS In accordance with the Companies Act 2013, the Statutory Auditors of the Company, Messrs Giri & Co. (Firm Registration No. 0067025), Chartered Accountants, Coimbatore have been already appointed as Statutory Auditors of the Company for a period of three years subject to ratification by members at every consequent Annual General Meeting. Therefore, ratification of appointment of Statutory Auditors is being sought from the members of the company at the ensuing Annual General Meeting. EMPLOYEES RELATIONS The Directors would like to place on record the cordial relations enjoyed with the employees by the company. ACKNOWLEDGEMENTS Your Directors record with a deep sense of gratitude to the working capital bankers for the excellent support and cooperation rendered by them to the company. Your Directors are thankful to its valuable customers, esteemed stakeholders and business associates for their continued support and the confidence reposed in the Company and its Management. For and on behalf of the Board of Directors (Sd./-) M.S. Velu Chairman and Managing Director DIN : 0168208 Place : Coimbatore Date : 14.08.2015 |