DIRECTORS' REPORT The Directors of your Company have pleasure to present 43" Annual Report with the Audited Statements of Accounts for the year ended 31" March, 2015. ECONOMIC SCENARIO & OUTLOOK: The turnover of the company has decreased by about 4.34% over the previous year. Gelatine sales have increased by 7.29% and whereas Ossein sales have reduced by 33 % during the year. The performance of the company is adversely affected due to shortage of raw materials leading to steep rise in raw material prices. Increase in manpower, labour costs, freight and forwarding costs have also put pressure on margins and operating profits during the year. During the year, the company initiated steps for the upgradation of its effluent treatment facility by refurbishing some of the existing equipments as well as modernization of the raw material grading facility. The Completion of both these projects would take place during the current financial year of 2015-16. The above measures being undertaken by the company will allow benefits to accrue overtime. On account of the fall in oil prices and to the extent the Govt, of India has allowed the reduction to be passed on to industrial consumers it has resulted into a reduced cost of energy by 8.65%. This was due to the steps implemented by the Company for changing over the source of its energy needs from Natural Gas to Furnace Oil. With the above mentioned steps being taken as well as other efforts to find newer markets for the company's products it is likely that the company will be in a position to achieve better results in the future MANAGEMENT DISCUSSION AND ANALYSIS REPORT: AReporton Management Discussion and Analysis is annexed herewith as "Annexure-A". DIVIDEND: Your directors recommend dividend @ 15% i.e. Rs. 1.50/- per share (previous year 18% i.e. Rs. 1.80 per share) on Equity Shares of Rs. 10/-each of the company for the year ended 31 * March, 2015. The proposed dividend (including Corporate Dividend Tax) will absorb Rs. 169.70 Lacs (previous year Rs. 197.96 Lacs) TAXATION: The Company has made a provision of Rs. 190.00 lacs towards current year's Income Tax. FINANCE: The Company continues to get requisite assistance and co-operation from its bankers as and when needed. INSURANCE: All the properties of the Company including building, plant and machinery and stocks have been adequately covered under insurance. INDUSTRIAL RELATIONS: Industrial relations continued to remain cordial and satisfactory. PUBLIC DEPOSITS: During the financial year 2014-15, your Company has not accepted any deposit within the meaning of Sections 73 & 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014. CORPORATE GOVERNANCE REPORT: In compliance with the provisions of Clause 49 of the Listing Agreement, a separate report on Corporate Governance along with a certificate from the Auditors on its compliance forms an integral part of this Report. DIRECTORS: Mr. Nayan C. Mirani a Non executive Director of the Company has resigned w.e.f 30" June, 2015. The Board has placed on record its sincere appreciation and gratitude for the valuable and outstanding contribution made by Mr. Nayan C. Mirani during his association with the Company as Director. At the ensuing Annual General Meeting of the Company Mrs. Shefali V. Mirani, Director of the Company retires by rotation but being eligible offers herself for reappointment. DIRECTORS' RESPONSIBILITY STATEMENT: As stipulated in Section 134 (3)(c) of the Companies Act, 2013, your Directors adhere to the "Directors' Responsibility Statement" and confirm as under: i) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; ii) that 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 and of the profit of the Company for the year; iii) that 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; iv) that the directors have prepared the annual accounts on a going concern basis; v) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; vi) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. AUDITORS AND AUDITORS' REPORT Statutory Auditors: At the 42™1 AGM of your Company, Messrs Mahendra N. Shah & Co., Firm Registration No: 105775W, Chartered Accountants, were appointed as the Statutory Auditors of the Company for a term of three years form 2014-2015 to 2016-2017. In accordance with Section 139 of the Act, you are requested to ratify the appointment of Statutory Auditors for the balance term. Secretarial Audit: Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 your Company has appointed M/s. Samdani Shah & Associates, Practising Company Secretaries to conduct the Secretarial Audit of your Company. The Secretarial Audit report is annexed herewith as "Annexure-E" to this report POLICY ON DIRECTORS' APPOINMENT AND REMUNERATION (Including criteria for determining qualification, positive attributes, independence of a Director, policy relating to remuneration for Directors, Key Managerial Personnel and other employees) (a) Policy on Directors'Appointment Policy on Directors' appointment is to follow the criteria as laid down under the Companies Act, 2013, the Listing Agreement with Stock Exchanges and good corporate practices. Emphasis is given to persons from diverse fields or professions. (b) Policy on Remuneration Guiding Policy on remuneration of Directors, Key Managerial Personnel and employees of the Company is that- • Remuneration to unionized workmen is based on the periodical settlement with the workmen union. • Remuneration to Key Managerial Personnel, Senior Executives, Managers, Staff and Workmen (non-unionized) is industry driven in which it is operating and also taking into account the performance leverage and factors such as to attract and retain quality talent. • For Directors, it is based on functions and responsibilities shouldered, the shareholders resolutions, provisions of the Act and Rules framed therein, circulars and guidelines issued by Central Government and other authorities from time to time. ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEES AND INDIVIDUAL DIRECTORS The Board of Directors of the Company has initiated and put in place evaluation of its own performance, its committees and individual directors. The result of the evalutjon is satisfactory and adequate and meets the requirement of the company. DECLARATION OF INDEPENDENCE BY THE INDEPENDENT DIRECTORS Pursuant to Section 149(6) of the Companies Act, 2013, Independent Directors of the Company have made a declaration confirming the compliance of the conditions of the independence stipulated in the aforesaid section. NUMBER OF MEETING OF BOARD OF DIRECTORS The Board of Directors have met 6 times and independent Directors once during the year ended 31* March, 2015. The details of which are mentioned in the Corporate Governance Report annexed herewith. DETAILS OF COMMITTEE OF DIRECTORS Composition of Audit Committee of Directors, Nomination and Remuneration Committee of Directors, number of meetings held of each Committee during the financial year 2014-15 and meetings attended by each member of the Committee as required under the Companies Act,2013 are provided in Corporate Governance Report and forming part of the report. The recommendation by the Audit Committee as and when made to Board has been accepted by it. KEY MANAGERIAL PERSONNEL: Your Company has designated Mr. Wen C. Mirani, the Managing Director, Mr. K.R Vagadia, the Chief Financial Officer and Ms. Preetal P. Mepani, Company Secretary as the Key Managerial Personnel. LOANS, INVESTMENT AND GUARANTEES BY THE COMPANY: There is no loan given, investment made, guarantee given or security provided by the Company to any entity under Section 186 of the Companies Act,2013. ANALYSIS OF REMUNERATION: Pursuant to Rule 5 of the Companies (Appointment and Remuneration Rules, 2014) a disclosure on remuneration related information of employees, Key Managerial Personnel and Directors is annexed herewith as" Annexure - B". EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in Form MGT- 9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as *Annexure-F" to this Report. RELATED PARTY TRANSACTIONS : All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. Form No. AOC-2 is set out herewith as "Annexure - G". There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. All related party transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit committee is obtained for the transactions which are of foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit committee and the Board of Directors for their approval. VIGIL MECHANISM/ WHISTLE BLOWER POLICY: The Company has a vigil mechanism named Whistle Blower Policy to deal with instance of fraud and mismanagement and provide a mechanism for the Directors / Employees of the Company to approach the designated persons / Chairman of the Audit Committee of the Company to, inter alia, report to the management instances of unethical behavior, actual or suspected, fraud or violation of the company's code of conduct or ethics policy. In staying true to our values strength, performance and passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of corporate governance and stakeholder responsibility. The details of the policy is explained in the Corporate Governance Report and also posted on the website of the Company. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES: As a part of its initiative under "Corporate Social Responsibility (CSR)", the Company has undertaken projects in the areas of Education, upliftment /empowerment of tribal girls. These projects are in accordance with Schedule VII of the Companies Act, 2013. The Report on CSRActivities is annexed herewith as "Annexure-D". CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is set out herewith as "Annexure C to this Report. PARTICULARS OF EMPLOYEES: The information under Section 134 of the Companies Act 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Directors' Report for the year ended 31" March, 2015 is setout herewith as "Annexure B". PREVENTION OF INSIDER TRADING: The Company has adopted a Code of Fair Disclosure as per regulation 8(1) & (2) and Code of Conduct as per regulation 9(1)&(2)of the SEBI (Prohibition of Insider Trading) Regulations, 2015 for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The code requires pre- clearance for dealing in the Company's Shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the trading window is closed. All Directors and designated employees have confirmed compliance with the code. ACKNOWLEDGEMENT: The Board of Directors appreciates the devoted services of the workers, staff and executives who have contributed to the efficient management of the affairs of the Company. Your directors place on record their gratitude to the State and Central Government, the company's Bankers, Customers, Suppliers and Shareholders for their continued co-operation and support. For and on behalf of the Board of Directors Viren C. Mirani Chairman & Managing Director (DIN: 00044901) Place: Mumbai Date : 27-05-2015 |