BOARDS' REPORT To the Members of, Gujarat Petrosynthese Limited The Directors have pleasure in presenting the 39th Annual Report of the Company together with the Audited Financial Statements of the Company for the year ended 31st March, 2016. Dividend Your Directors are unable to recommend any dividend. Performance & Future Outlook The current year has seen a rise in the sales turnover from 877.93 lakhs to 1117.92 lakhs due to a change in the method of sales of our major customer from subcontract to direct sales. The overall sales have remained at the same level in terms of tonnage. During the year some of our major customers lost business with the OEMs. However due to our persistent efforts in capturing new customers we were able to maintain the sales at last year's level. The company has introduced measures to enhance the productivity and efficiency of the plant machinery and equipment. We expect the industry to do better in the coming year and hope to reach a profitable position by the end of the year. Performance of the Subsidiary Our subsidiary company has been suffering from differential pricing of feedstock and return stream. We have been working with a Government company for supply of raw material and return stream at the same price like our competitor but the issue was not resolved. This has resulted in our inability to compete with our Indian competitor as well as imports. We have therefore suspended our operations from February 2016 and are looking at different avenues to restart our operations. We are hopeful to tide over these difficulties Business During the year under review, there is no change in the business activities of the Company. Material changes and commitment occurred after the end of Financial Year and upto the date of Report No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year and upto the date of this report. Consolidated Financial Statement In accordance with the provisions of Section 129(3) read with Rule 5 of Companies (Accounts) Rules, 2014, statement containing salient features of the financial statements of subsidiary companies is disclosed separately in Annexure I and forms part of the annual report. The consolidated financial statements are prepared in accordance with the Accounting Standard (AS) - 21 issued by the Institute of Chartered Accountants of India. Deposits The Company has neither accepted nor renewed any deposits during the year under review to which the provisions of the Companies (Acceptance of Deposits) Rules 2014 applies. Subsidiaries, Joint Ventures and Associate Companies The Company does not have any Joint Venture Company or Associate Company. But the Company has the following 100% Subsidiary Companies. 1. Gujarat Polybutenes Private Limited. 2. GPL Finance and Investments Limited Share capital During the year under review, there is no change in the share capital of the Company. Transfer to Investor Education & Protection Fund. In terms of Section 125 of the Companies Act, 2013, there is no amount required to be transferred to the Investor Education and Protection Fund established by the Central Government. Directors and Key Managerial Personnel During the year under review, the following changes have occurred in the position of the Directors/ KMPs of the Company: • Mr. R.M.Thakkar has resigned from the position of the Managing Director and shall continue as the Non-Executive Chairman and Director of the Company. • There has been a change in designation of Ms. Urmi N Prasad from Whole-Time Director of the Company to Joint Managing Director of the Company. • Ms. Charita Thakkar has been appointed as the Joint Managing Director of the Company. In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Ms. Charita Thakkar (DIN 00321561), shall retire by rotation at the ensuing annual general meeting and being eligible offers herself for reappointment. Independent Directors The Company has received declarations from all the Independent Directors confirming that they meet with the criteria of independence as prescribed under the requirement of provisions of Section 149(6) of the Companies Act, 2013. Independent Directors' Meeting During the year under review, the Independent Directors met on March 11, 2016, inter alia, to discuss: • Evaluation of performance of the Independent Directors and the Board of Directors as a whole; • Evaluation of performance of the Chairman of the Company, taking into account the views of the Executive and Non-Executive Directors. • Evaluation of quality, consent and timelines of flow of information between the Management and the Board that is necessary for the Board for effective performance of its duties. All the Independent Directors were present at the Meeting. Directors' Appointment and Remuneration Policy The Company has constituted a Nomination and Remuneration Committee as per the provisions of Section 178(1) of the Companies Act, 2013. The Company has adopted the Policy for the Selection of the Directors and determining the Directors Independence and remuneration for the policy for the Directors and the Key Managerial Personnel. The Company has a Non - Executive Chairman, two Joint Managing Director and three Independent Directors. Board Meetings During the year five Board Meetings were convened and held on 30.05.2015, 25.07.2015, 14.11.2015, 29.12.2015 and 05.02.2016. Director's Responsibility Statement Your Directors state that: (a) in the preparation of the annual accounts, the applicable accounting standards have been followed and there is no material departures from the same; (b) the Directors have selected such accounting policies and applied them consistently and have 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 as at March 31, 2016 and of the profit and 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 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; and (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. (f) the Directors have devised proper systems to ensure compliance with the provisions of all the applicable laws and that such systems are adequate and operating effectively. Audit Committee The Audit Committee met four times during the year under review. All the recommendations made by the Audit Committee were accepted/ approved by the Board. The compositions of the Audit Committee are as under. 1. Mr. M.D.Garde Chairman 2. Mr. V.Raghu Member 3. Mr. R.M.Thakkar Member Auditors & Auditors Report Statutory Auditor M/s S J H & Co., Chartered Accountants, the statutory Auditors of the Company, retire at the ensuing Annual General Meeting of the Company and being eligible for re-appointment have expressed their willingness to continue. The Company has received a certificate from the Auditors that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. The Board recommends their re-appointment. Shareholders are requested to re-appoint the Auditors for the financial year 2016-17 and authorize the Board to fix their remuneration. As per Section 134(3) of the Companies Act, 2013 the notes/ comments of Auditors referred to in the Auditors' Report are self explanatory and do not call for further explanation. The Auditors' Report does not contain any qualification, reservation or adverse remark. Internal Auditor Your Company has adopted an internal control system, commensurate with its size. The Company has re-appointed M/s AJBS & Associates, Chartered Accountants as the Internal Auditor of the Company for the financial year 2016-17. Your Company ensures compliance and controls so that the assets and business interests of your Company are adequately safeguarded. Secretarial Auditor The Board has appointed M/s. J.J. Gandhi & Co., Practicing Company Secretary, to conduct Secretarial Audit for the Financial Year 2015-16. The Secretarial Audit Report for the Financial Year ended March 31, 2016 is annexed herewith marked as Annexure II to this Report. The Secretarial Audit Report contains a qualification as mentioned below: As per the requirements of Regulation 31(2) of the SEBI (LODR) Regulations, 2015 the 100% share holding of the promoters have not been maintained in demat form. It is replied that the certain Promoter members having shares in physical form are British Nationals and therefore do not possess the PAN card, which is mandatory for opening up of an demat account. For other promoter members, the management is under the process of converting them into demat. Risk Management Policy The Board of Directors is overall responsible for identifying, evaluating and managing all significant risks faced by the Company. The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting. The operations and working of the Company can be affected on account of any of the following risk factors; - Policy of Govt. as to excise duty etc. - Policy of competitors - Market conditions Vigil Mechanism / Whistle Blower Policy The Company has adopted Vigil Mechanism/Whistle Blower Policy to deal with fraud or mismanagement, where it has a mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct / Business Ethics, if any. No personnel has been denied access to the Chairman of the Audit Committee, for making complaint on any Integrity issue. Corporate Social Responsibility (CSR) The provisions of Section 135 of the Companies Act, 2013 read with Rule 9 of the Companies (Accounts) Rules, 2013 are not applicable to the Company, as the Company does not meet with the requirement of profit criteria. Conservation of Energy, Technology Absorption and Foreign Earnings and Outgo 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 is furnished in Annexure III and is attached to this Report. Corporate Governance The compliance with the corporate governance provisions as specified in regulations 17, 18, 19, 20, 21,22, 23, 24, 25, 26, 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and para C , D and E of Schedule V is not applicable to the Company but your Company strives to ensure that best corporate governance practices are adopted and consistently followed. Related Parties Transactions The particulars of transactions or contracts entered or arrangements made with related parties pursuant to provisions of section 188 of the Companies Act, 2013 is provided in Annexure IV and is attached to this Report. Extract of Annual Return The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is provided in Annexure V and is attached to this Report. Disclosure under the Sexual Harassment of Women at workplace (Prevention of, Prohibition and Redressal) Act, 2013. The Company has in place an Anti Sexual Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. Acknowledgments The Board of Directors wish to place on record their appreciation for the continuous support of the Bankers, vendors and buyers and shareholders in the performance of the Company. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company's executives, staff and workers. For and on behalf of the Board Gujarat Petrosynthese Limited Ms. Urmi N. Prasad Jt. Managing Director DIN : 00319482 Place : Mumbai Date : 27th May, 2016 |