DIRECTORS' REPORT TO, THE MEMBERS, Your Directors have pleasure in presenting their 26th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31,2015. 2. Brief description of the Company's working during the year/State of Company's affair The Company has Hook and Loop Tape fasteners as a major division now. Other Divisions viz. Malai Dori, Elastics etc are now closed. The contribution of Hook and Loop Tape Fasteners is 85% of the overall revenue of the Company. The other significant divisions are Velvet Manufacturing based in Daman. The turnover of the Company was 55.38 Crores, nearly the same as previous year. The PAT was negative considering pressures on other businesses of the Company, vis a vis a PAT of Rs. 68 Lacs in the previous year. The trend of performance is reflected in the Consolidated results as well. 3. Change in the nature of business, if any The Company is looking to leverage on its core competency in narrow woven fabrics. Other allied businesses have been shut and the focus now is on primary business. 4. Dividend In view of inadequate profits, the Directors do not recommend any dividend for the currentyear. 5. Change of Name The Company has not changed its name during the year under preview. 6. Share Capital The Company has not issued any shares with differential voting rights as well as neither issued any sweat equity. 7. Directors and Key Managerial Personnel During the year, Ms Aditi Bhatt has been appointed as Independent Director in the Company._ 8. Particulars of Employees Pursuant to the Companies [Appointment and Remuneration of Managerial Personnel) Rules, 2014, statement of particulars of employees is annexed as Annexure II. 9. Meetings A calendar of Meetings is prepared and circulated in advance to the Directors. During the year six Board Meetings and six Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. 10. Board Evaluation Pursuant to the provisions of the Companies Act, 2013, 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 Compliance Committees. 11. Declaration by an Independent Director(s) and reappointment, if any A declaration by the Independent Directors that they meet the criteria of independence as provided in sub-section (6) of Section 149 of the Companies Act, 2013 has been obtained. An independent director shall hold office for a term up to five consecutive years on the Board of a Company, but shall be eligible for reappointment for next five years on passing of a special resolution by the Company and disclosure of such appointment in the Board's report. 12. Remuneration Policy The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration Managerial Remuneration: A) Details of the ratio of the remuneration of each director to the median employee's remuneration and other details as required pursuant to Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. B) Details of the every employee of the Company as required pursuant to 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 C) Any director who is in receipt of any commission from the company and who is a Managing Director or Whole-time Director of the Company shall receive any remuneration or commission from any Holding Company or Subsidiary Company of such Company subject to its disclosure by the Company in the Board's Report. 13. Details of Subsidiarv/Ioint Ventures/Associate Companies Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient feature of the financial statement of a company's subsidiary or subsidiaries, associate company or companies and joint venture or ventures is given as Annexure-III Further, the Annual Accounts and related documents of the subsidiary company shall be kept open for inspection at the Registered & Corporate Office of the Company. The Company will also make available copy thereof upon specific request by any Member of the Company interested in obtaining the same. Further, pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by the Company in this Annual Report include the financial information of its subsidiary. 14. AUDITORS: The Auditors, M/s Thanawala & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment for a period of one year from the conclusion of this Annual General Meeting [AGM] till the conclusion of next AGM._ 15. AUDITORS'REPORT The Auditors' Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments. 16. Disclosure about Cost Audit As per the Cost Audit Orders, Cost Audit is not applicable to the Company's products/ business of the Company for FY2014-15 17. Secretarial Audit Report In terms of Section 204 of the Act and Rules made there under, M/s. Ramesh Chandra Mishra, Practicing Company Secretary have been appointed Secretarial Auditors of the Company. The report of the Secretarial Auditors is enclosed as Annexure IV to this report. The report is self-explanatory and do not call for any further comments. 18. Internal Audit & Controls The Company continues to engage M/s Sitendu Sharma & Co as its Internal Auditor. During the year, the Company continued to implement their suggestions and recommendations to improve the control environment. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency effectiveness of systems and processes, and assessing the internal control strengths in all areas. Internal Auditors findings are discussed with the process owners and suitable corrective actions taken as per the directions of Audit Committee on an ongoing basis to improve efficiency in operations. 19. Issue of employee stock options No ESOP were granted in the year under preview. 20. Vigil Mechanism: In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.skyindia.com under investors/policy documents/Vigil Mechanism Policy link 21 Risk management policy A statement indicating development and implementation of a risk management policy for the Company including identification therein of elements of risk, if any, this in the opinion of the Board may threaten the existence of the company. 22. EXTRACT OF ANNUAL RETURN: As required pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2 014, an extract of annual return in MGT 9 as a part of this Annual Report asANNEXUREI. 23. No material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report 24. Deposits The Company has not accepted any deposits within the meaning of Deposits under the Chapter V of the Act. 26. Particulars of contracts or arrangements with related parties: The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm's length transactions under third proviso thereto has been disclosed in Notes to Accounts. 27. STATUTORY DISCLOSURES In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the employees are set out in the annexure to the Directors' Report. However, as per the provisions of Section 219 (b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining such particulars may write to the Company at the registered office of the Company. 28. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9th December, 2013. Under the said Act every company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at workplace of any women employee. Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. During the year Company has not received any complaint of harassment. 29. Conservation of energy, technology absorption and foreign exchange earnings and outgo The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows: a) Conservation of energy The production activity of the Company is not energy intensive. However, all measures are being taken for optimizing energy usage. (b) Technology absorption The Company plans to introduce various measures to help the production improvement as well as reduce the wastage further. (c) Foreign exchange earnings and Outgo During the year, total foreign exchange used was Rs. 2414 Lakhs and the total foreign exchange earned was Rs. 711 lakhs. 30. Corporate Social Responsibility (CSR) As per the Companies Act, 2013, all companies having net worth of Rs. 500 crore or more, or turnover of Rs. 1,000 crore or more or a net profit of Rs.5 crore or more during any financial year are required to constitute a corporate social responsibility (CSR) committee of the Board of Directors comprising three or more directors, at least one of whom should be an independent director and such Company shall spend at least 2% of the average net profits of the Company's three immediately preceding financial year. The Company presently does not meet with any of the criteria stated herein above. 31. Human Resources Your Company treats its "human resources" as one of its most important assets. Your Company continuously invest in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement. 32. Directors' Responsibility Statement Pursuant to the clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013 pertaining to the Directors' Responsibility Statement it is hereby confirmed that— (a) in the preparation of the annual accounts, the applicable accounting standards had 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 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 were operating effectively. (f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 33. Transfer of Amounts to Investor Education and Protection Fund Your Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF). Pursuant to the provisions of the Investor Education Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM (i.e. 27th Sep, 2014), with the Ministry of Corporate Affairs. 34. Acknowledgements An acknowledgement to all with whose help, cooperation and hard work the Company is able to achieve the results. For and on behalf of the Board of Directors Shailesh Shah Managing Director Place: MUMBAI Date: 11th Aug 2015 |