DIR E C TO R S R E PO R T To, Dear Members, The Directors have pleasure in presenting the 40th Annual Report on the business and operations of the Company together with the financial results for the period ended 31st, March 2015. COMPANY'S PERFORMANCE The overall performance for the financial year ended 31st March, 2015 was satisfactory. The profits of company earned during the year were amounted to Rs. 4,210,660/-. However, your Directors are confident that the company will do much better in future and trying its level best to further improve its performance. DIVIDENDS Keeping in view the present financial position of the company, your Directors do not recommend any dividend for the year ended 31st March 2015. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that: i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures; ii. they 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 that period; iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv. they have prepared the annual accounts on a going concern basis; v. they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; vi. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Company's internal financial controls were adequate and effective during the financial year 2014-15. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION AND OTHER DETAILS The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in website of company. INTERNAL FINANACIAL CONTROL SYSTEM According to Section 134(5) (e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Company has a well-placed, proper and adequate internal financial control system which ensures that all assets are safeguarded and protected and that the transactions are authorised, recorded and reported correctly. The Company's internal financial control system also comprises due compliances with Company's policies and Standard Operating Procedures (SOPs) and audit and compliance by in-house Internal Audit Division, supplemented by internal audit checks from M/s. Kudsia & Associates, Charted Accountants, the Internal Auditors. The Internal Auditors independently evaluate the adequacy of internal controls and concurrently audit the majority of the transactions in value terms. Independence of the audit and compliance is ensured by direct reporting of Internal Audit Division and Internal Auditors to the Audit Committee of the Board. NUMBER OF MEETINGS OF THE BOARD Eight meetings of the board were held during the year. For details of the meetings of the board, please refer to the Corporate Governance report, which forms part of this report. COMMITTEES OF THE BOARD Detailed information on the Board and its Committees is provided in the Report on Corporate Governance forming part of this Annual Report. MANDATORY COMMITTEE Audit Committee As at March 31, 2015, the Audit Committee comprised of Two Independent Directors namely, Mr. Maman Chand Jain & Mr. Ashwani Kumar Jindal and one Non-Executive Director namely, Mr. Amitabh Agrawal. Mr. Maman Chand Jain is the Chairman of the Audit Committee. All the recommendations made by the Audit Committee were accepted by the Board. Nomination and Remuneration Committee As at March 31, 2015, the Nomination and Remuneration Committee comprised of Two Independent Directors namely, Mr. Maman Chand Jain & Mr. Ashwani Kumar Jindal and one Non-Executive Director namely, Mr. Amitabh Agrawal. Mr. Maman Chand Jain is the Chairman of the Nomination and Remuneration Committee. Stakeholders Relationship Committee As at March 31, 2015, the Stakeholders Relationship Committee comprised of Two Independent Directors namely, Mr. Maman Chand Jain & Mr. Ashwani Kumar Jindal and one Non-Executive Director namely, Mr. Amitabh Agrawal. Mr. Ashwani Kumar Jindal is the Chairman of the Stakeholders Relationship Committee. Risk Management Committee As at March 31, 2015, the Risk Management Committee comprised of One Whole Time Directors namely, Mr. Chaitanya Agrawal and one Non-Executive Director namely, Mr. Amitabh Agrawal. Mr. Chaitanya Agrawal is the Chairman of the Risk Management Committee. NON-MANDATORY COMMITTEE Management Committee As at March 31, 2015, the Management Committee comprised of one Executive Director namely Mr. Suresh Chandra Agrawal, one Managing Director namely, Mr. Piyush Agrawal, one Whole Time Directors namely, Mr. Chaitanya Agrawal and one Independent Director Mr. Ashwani Kumar Jindal. Mr. Piyush Agrawal is the Chairman of the Management Committee. EXTRACT OF ANNUAL RETURN As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure I in the prescribed Form MGT-9, which forms part of this report. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report and are annexed as Annexure II. There are no employees who are drawing remuneration in excess of the limits as set out in provisions of Section 197(12) of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. EMPLOYEES BENEFITS Retirement benefit in the form of provident fund is a defined contribution scheme. The contributions to the provident fund are charged to the statement to the profit and loss for the year when the contributions are due. Pending determination of liability for gratuity payable, no provision has been made in the accounts for expenses of gratuity. The expenditure on account of gratuity is accounted in the year of payment. On account of non provision of gratuity payable, the profit has been over stated but the same cannot be quantified in absence of exact amount payable under this account CODES, STANDARDS AND POLICIES AND COMPLIANCES THEREUNDER CODE OF CONDUCT FOR THE BOARD OF DIRECTORS AND THE SENIOR MANAGEMENT PERSONNEL Your Company has adopted a Code of Conduct for its Board of Directors and the Senior Management Personnel. The Code requires the Directors and employees of the Company to act honestly, ethically and with integrity and in aprofessional and respectful manner. During the year under review, the Code of Conduct was revised as per the revised Clause 49 of the Listing Agreement. A Chief Financial Officer with regard to compliance with the said code, forms part of this Annual Report. CODE FOR PROHIBITION OF INSIDER TRADING PRACTICES Your Company has in place a Code for Prevention of Insider Trading Practices in accordance with the Model Code of Conduct, as prescribed under Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, as amended and has duly complied with the provisions of the said code. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. PREVENTION, PROHIBITION & REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE The Company has in place a Policy on Prevention, Prohibition & Redressal of Sexual Harassment of Women at Workplace and an Internal Complaints Committee (ICC) has been constituted thereunder. The primary objective of the said Policy is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. NOMINATION REMUNERATION & EVALUATION POLICY The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Nomination Remuneration & Evaluation Policy, which, inter-alia, lays down the criteria for identifying the persons who are qualified to be appointed as Directors and/or Senior Management Personnel of the Company, alongwith the criteria for determination of remuneration of Directors, KMPs and other employees and their evaluation and includes other matters, as prescribed under the provisions of Section178 of Companies Act, 2013 and Clause 49 of the Listing Agreement. The details of the same are provided in Corporate Governance Report forming part of this Annual Report. DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT Cranex Limited has in place comprehensive risk assessment and minimization procedures, which are reviewed by the Board periodically. During the year, as per the requirements of Listing Agreement with the Stock Exchanges, a Risk Management Committee was constituted by the Board of Directors in its meeting held on 14th November, 2014 with the responsibility of preparation of Risk Management Plan, reviewing and monitoring the same on regular basis, to identify and review critical risks on regular basis, to update Risk Register on quarterly basis, to report key changes in critical risks to the Board on an ongoing basis, to report critical risks to Audit Committee in detail on yearly basis and such other functions as may be prescribed by the Board. Further, the Company identifies risks, and control systems are instituted to ensure that the risks in each business process are mitigated. The one Chief Risk Officer (CRO) Mr. Ajay Pradhan is responsible for the overall risk governance in the Company and reports directly to the Risk Management Committee, which consists of various functional heads. The Board provides oversight and reviews the Risk Management Policy on a quarterly basis. In the opinion of the Board there has been no identification of elements of risk that may threaten the existence of the Company. DISCLOSURE ON WHISTLE-BLOWER POLICY /VIGIL MECHANISM The Company has established a vigil mechanism and formulated Whistle-Blower Policy in the meeting of Board of Directors held on held 14th November, 2014 through which Directors, employees and business associates may report unethical behavior, malpractices, wrongful conduct, fraud, violation of Company's code of conduct without fear of reprisal. The Company has set up a Direct Touch initiative, under which all Directors, employees, business associates have direct access to the Chairman of the Audit Committee, and also to a three-member direct touch team established for this purpose. The direct touch team comprises one senior woman member so that women employees of the Company feel free and secure while lodging their complaints under the policy. Further information on the subject can be referred in Corporate Governance Report. SECRETARIAL AUDITORS AND THEIR REPORTS M/s PARVEEN RASTOGI & CO., Company Secretaries, were appointed as Secretarial Auditors of the Company for the financial year 2014-15 pursuant to Section 204 of the Companies Act, 2013. The Secretarial Audit Report submitted by them in the prescribed Form MR- 3 is attached as 'Annexure III' and forms part of this report. There are no qualifications or observations or other remarks of the Secretarial Auditors in the Report issued by them for the financial year 2014-15 which call for any explanation from the Board of Directors. STATUTORY AUDITORS AND THEIR REPORTS M/s. P.D. Mittal & Co., Chartered Accountants, have been appointed as Statutory Auditors of the Company, to hold office from the conclusion of 39th Annual General Meeting until the conclusion of 42th Annual General Meeting of the Company to be held in 2017, subject to ratification of the appointment by the Members at every subsequent Annual General Meeting, as per the provisions of Companies Act, 2013. There is one observations (including any qualification, reservation, adverse remark or disclaimer) of the Auditors in their Audit Report i.e. "accounting standards 22- provision of deferred tax liability either for the current year or in respect of the past". For this the Board would like to inform that the Company has not created provision of deferred tax liability since it will not lead any major financial impact. Further, the notes to accounts referred to in the Auditor's Report are self-explanatory. TRANSACTIONS WITH RELATED PARTIES Related party transactions entered during the financial year under review are disclosed in Note No.30 of the Financial Statements of the company for the financial year ended March 31, 2015. These transactions entered were at an arm's length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company's Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure-IV. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS The particulars of loans, guarantees and investments have been disclosed in the financial statements. EMPLOYEES STOCK OPTION SCHEME During the year under review, the Company has not allotted any shares under Employee Stock Option Scheme (ESOS) and hence no disclosure is required to be made in compliance with Clause 12 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Regulations, 1999. DISCLOSURE REQUIREMENTS As per Clause 49 of the listing agreements entered into with the stock exchanges, corporate governance report with auditors' certificate thereon and management discussion and analysis are attached, which form part of this report. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, the details of Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are as follows: A. Conservation of Energy a) Energy conservation measures taken : • The Company has always been conscious of the need for the conservation of energy and optimum utilisation of available resources and has been steadily making progress towards this end. • The company has taken lot of initiatives for reduction in power cost by improving the production processes. Production process of the company does not require much power. • There is an optimum ratio of glass windows to utilise natural light and proper insulation / ventilation to balance temperature and reduce heat. b) Impact of above measures : • The above measures will results in lower energy consumption, significant reduction in Carbon emissions, and hedge against continuous energy rate increase. B. Technology Absorption, Adaptation And Innovation The company has successfully absorbed the technology for the development of various new models of the cranes. Your company is constantly improving its technology to match world standards, which is reflected in the new orders being received from very quality conscious customers. MANAGEMENT DISCUSSION AND ANALYSIS Management Discussion and Analysis for the year as stipulated under Clause 49 of the Listing Agreement is separately given and forms part of this Annual Report provides a more detailed analysis on the performance of individual businesses and their outlook. REPORT ON CORPORATE GOVERNANCE The Company is committed to maintain the highest standards of Corporate Governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement is separately given and forms part of this Annual Report. The requisite certificate from a Practicing Company Secretary confirming compliance of the conditions of Corporate Governance is attached to the Report on Corporate Governance. DIRECTOR Mr. Piyush Agrawal, Director of the Company, retires by rotation and being eligible, offers himself for reappointment. Your directors solicit your approval for his reappointment as a director of the Company. Mr. Anil Jain has resigned from the post of Independent Director w.e.f. 15th December, 2014 KEY MANAGERIAL PERSONNELS The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows: 1. Mr. Piyush Agarwal — (Managing Director), 2. Mr. Chaitanya Agrawal — (Chief Financial officer & Whole Time Director), 3. Ms. Khushboo Verma ---- (Company Secretary). During the year under review Mr. Birendra Kumar has resigned from the post of Company Secretary w.e.f. 31.08.2014. Ms. Khushboo Verma was appointed as Company Secretary of the Company w.e.f. 31.08.2014 and as Key Managerial Personnel w.e.f. 06.09.2014. Mr. Chaitanya Agrawal was appointed as a Chief Financial officer & Key Managerial Personnel of the of the Company w.e.f. 24.04.2015 under section 203 of the Companies Act, 2013. DECLARATION BY INDEPENDENT DIRECTORS The Independent Directors have submitted the declaration of independence, as required pursuant to section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6). MATERIAL CHANGES AND COMMITMENTS There have been no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of the financial year of the Company and the date of this Report. CAPITAL STRUCTURE AND LISTING OF SHARES The paid up equity share capital as on 31st March 2015 was Rs. 60,000,000/- (Rupees Six Crores). There was no public issue, rights issue, bonus issue or preferential issue etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares nor has it granted any stock options The Company's shares are listed on the Bombay Stock Exchange Limited (BSE), and are actively traded. The company has paid the listing fees to Bombay Stock Exchanges for the year 2015-16. DEPOSITS FROM PUBLIC The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet. INDUSTRIAL RELATION The Company maintained healthy, cordial and harmonious industrial relations at all levels. The enthusiasm and unstinting efforts of Employees have enabled the Company at good position in the industry. It has taken various steps to improve productivity across organization. ACKNOWLEDGEMENTS Your Directors place on record their gratitude to the Central Government, State Governments and Company's Bankers for the assistance, co-operation and encouragement they extended to the Company. Your Directors also wish to place on record their sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, dealers, business associates and employees in ensuring an excellent all around operational performance. By Order of the Board of Directors For Cranex Limited Sd/- (Piyush Agrawal) Managing director DIN:01761004 Sd/- (Suresh Chandra Agrawal) Chairman DIN:01958471 Place: New Delhi Date: 07.09.2015 |