DIRECTORS' REPORT TO THE SHAREHOLDERS 1. Your Directors have great pleasure in presenting the 27th Annual Report together with the Audited Accounts of the Company for the year ended March 31st, 2016. 2. OPERATIONAL REVIEW: The operations of the Company have faced huge volatility during the year under review owing to fluctuations in the global market of the products in which the Company operates. The prices and realizations remained quite lower during most part of the year as compared to the previous year. Therefore, the turnover of the Company has witnessed a drop during the year under review and the profitability commensurately has declined. Your Company has been trying to adjust to the changing global situations and devising strategies to improve its performance during the current year. 3. DIVIDEND: Your Directors have pleasure in recommending, for approval of the Members, at its 27th Annual General Meeting, a Dividend of Rs. 5/- per share i.e. 50% for the year ended March 31, 2016. If approved at the forthcoming Annual General Meeting, it will result in an outflow of Rs. 398 Lakhs to the Members of the Company, coupled with Rs. 74 Lakhs as Dividend Distribution Tax. This will be 23rd consecutive year of payment of dividend by your Company. 4. SHARE CAPITAL OF THE COMPANY: The Paid up Equity Share Capital, as at 31st March, 2016 was Rs. 79,627,500/- divided into 7,962,750 Equity shares, having face value of Rs. 10/- each fully paid up. During the year under review, the Company has not issued any shares with differential voting rights nor granted any stock options nor sweat equity. 5. SUBSIDIARIES & ASSOCIATE COMPANIES: The Company does not have any subsidiary or associate companies. 6. NEW LINE OF BUSINESS -- SOLAR POWER PROJECT: Solar Power Project of the Company during the year contributed revenue of Rs. 132 Lakhs and incurred a loss of Rs. 18 Lakhs during the year, after providing depreciation of Rs. 125 Lakhs. Recently, the Company has been awarded an Order for 30MW Solar Power Project under JNNSM Ph-II, Batch III and Tranche-I for the State of Maharashtra by Solar Energy Corporation of India (SECI) (A Government of India Enterprise). The Company will install this plant at Ahmednagar District, Maharashtra with a PPA tenure with SECI for 25 years. The project will be installed at a capital outlay of Rs. 189 Crores and will get completed on Turnkey basis. The Company will also operate and maintain the plant for 25 years. The completion of the Project is expected by the end of the Financial Year 2016-17. 7. BOARD OF DIRECTORS: In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the Company, Mrs. Chandraprabha Bhageria, Director of the Company, retires by rotation at the forthcoming Annual General Meeting and being eligible offers herself for re-appointment. All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulation, 2015. 8. DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to Section 134 of the Act, with respect to Directors responsibility statement it is hereby confirmed : (a) that in the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any; (b) that the Directors had 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 had 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 had prepared the annual accounts on a going concern basis; (e) the Directors, had 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 had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 9. KEY MANAGERIAL PERSONNEL : There has been no change in the Key Managerial Personnel of the Company during the year under review. 10. ANNUAL PERFORMANCE EVALUATION: Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015, the company has implemented a system of evaluating performance of the Board of Directors and of its Committees and individual Directors on the basis of evaluation criteria suggested by the Nomination and Remuneration Committee. Accordingly, the Board has carried out an evaluation of its performance after taking into consideration various performance related aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, remuneration, obligations and governance. The performance evaluation of the Board as a whole and Chairperson and the Non-Independent Directors was also carried out by the Independent Directors at their meeting held on 29th January, 2016. Similarly, the performance of various committees, individual independent and Non independent Directors was evaluated by the entire Board of Directors (excluding the Director being evaluated) on various parameters like engagement, analysis, decision making, communication and interest of stakeholders. The Board of Directors expressed its satisfaction with the performance of the Board, its committees and individual Directors. 11. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS: The details of the number of Board meetings held during the Financial Year 2015-16 are given in the Corporate Governance Report. 12. AUDIT COMMITTEE : In accordance with the provisions of the Regulation 18 of SEBI (LODR) Regulations, 2015 and Companies Act, 2013, the Company is having an Audit Committee comprising of Independent Directors. The Audit Committee acts in accordance with the terms of reference specified from time to time by the Board. The details of the terms of Audit Committee and other details are explained in the Corporate Governance Report. 13. REMUNERATION & NOMINATION POLICY : The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The policy lays down the criteria for selection and appointment of Board Members. The details of the policy are explained in the Corporate Governance Report. 14. VIGIL MECHANISM / WHISTLE BLOWER POLICY : The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns, grievances, frauds and mismanagements, if any. The Vigil Mechanism / Whistle Blower policy has been posted on the website of the Company (www.bhageriagroup.com ). 15. FIXED DEPOSITS: Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. 16. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: There is no loan given, investments made or guarantees given or security provided by the Company to any entity covered under the provisions of Section 186 of the Companies Act, 2013. 17. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES: The Company is having in place a "Corporate Social Responsibility" (CSR) Committee. As part of its initiatives under CSR, the Company has contributed funds for the schemes of rural development, promotion of education and medical aid. The contribution in this regard has been made to the registered trust(s) which are undertaking these schemes. The Company has also undertaken schemes in which the amount has been directly spent by the Company. The Annual Report on CSR activities is annexed herewith as: Annexure 'A'. 18. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS: There are no significant and material orders passed by the Regulators or Courts that would impact the going status of the Company and its future operations. 19. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure 'B'and forms an integral part of this Report. 20. RELATED PARTY TRANSACTIONS : All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. Further, there are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. All related party transactions are placed before the Audit Committee and also before the Board for their approval in accordance with the Policy on Related Party Transactions formulated by the Board of Directors of the Company and has been posted on the website of the Company (www.bhageriagroup.com ). Omnibus approval was obtained from the Audit Committee for transactions which were of repetitive nature with monitoring and review on quarterly basis. 21. DEPOSITORY SERVICES : The Company's Equity Shares have been admitted to the depository mechanism of the National Securities Depository Limited (NSDL) and also the Central Depository Services (India) Limited (CDSL). As a result the investors have an option to hold the shares of the Company in a dematerialized form in either of the two Depositories. The Company has been allotted ISIN No. INE354C01019. Shareholders therefore are requested to take full benefit of the same and lodge their holdings with Depository Participants [DPs] with whom they have their Demat Accounts for getting their holdings in electronic form. 22. CODE OF CONDUCT: Your Company is committed to conducting its business in accordance with the applicable laws, rules and regulations and highest standards of business ethics. In recognition thereof, the Board of Directors has implemented a Code of Conduct for adherence by the Directors, Senior Management Personnel and Employees of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity. The Code with revision made in accordance with the requirements of SEBI (LODR) Regulations, 2015 has been posted on the Company's website www.bhageriagroup.com All the Board Members and Senior Management Personnel have confirmed compliance with the Code. 23. STATUTORY AUDITOR: M/s. Sarda & Pareek, Chartered Accountants, (Firm Registration No.109262W), who were appointed as the Statutory Auditors of the Company at the 25th AGM held on 26th July, 2014 to hold office until the conclusion of the 28th AGM, are recommended for ratification of appointment for the Financial Year 2016-17. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s. Sarda & Pareek that their appointment, if made, would be in conformity with the limits specified in the said Section. 24. COST AUDIT : As per the requirement of the Central Government and pursuant to Section 148 of the Companies Act, 2013 and rules made thereunder, your Company has been complying with the provisions of audit of cost records of the Company every year. The Board of Directors, on the recommendation of the Audit Committee, have appointed M/s. Sushilkumar Mantri & Associates, Cost Accountants as the Cost Auditors to audit the cost records of the Company for the Financial Year 2016-17 at a remuneration of Rs. 55,000/- plus service tax as applicable and reimbursement of out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking members' approval for remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting. 25. SECRETARIAL AUDIT: Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Rules made thereunder, the company has appointed M/s. GMJ & Associates, Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure 'C' and forms an integral part to this Report. 26. AUDITOR'S REPORT / SECRETARIAL AUDIT REPORT: The observations of the Auditors contained in their Report have been adequately dealt with in the Notes to the Accounts which are self-explanatory and, therefore, do not call for any further comments. 27. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit functions is defined by the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairperson of the Audit Committee of the Board & to the Chairperson & Managing Director. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Based on the report of internal audit function, the Company undertakes corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. 28. CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS: The Company adheres to the requirements set out by the Securities and Exchange Board of India's Corporate Governance practices and have implemented all the stipulations prescribed. The Company has implemented several best corporate governance practices. The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexures, together with the Certificate from the Auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in SEBI (LODR) Regulations, 2015. 29. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO: The information on conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure 'D' to this Report. 30. SEXUAL HARASSMENT: The Company has constituted an Internal Complaint Committee as required under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. During the year under review, no complaints were reported. 31. ENVIRONMENT AND SAFETY: The Company is aware of the importance of environmentally clean and safe operations. The Company's policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances, environmental regulations and preservation of natural resources at the Plant. 32. RISK MANAGEMENT POLICY: The Company is having a Risk Management Committee which has been entrusted with the responsibility to assist the Board (a) to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated, minimized and managed i.e. to ensure adequate systems for risk management (b) to establish a framework for the company's risk management process and to ensure its implementation (c) to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices (d) to assure business growth with financial stability. 33. PARTICULARS OF EMPLOYEES: The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure E & F to this Report. 34. LISTING: The Company's Shares are listed on BSE Limited, Mumbai and NSE Limited. The shares of the Company have been listed on NSE Limited w.e.f. 2nd March, 2016. 35. APPRECIATION : Your Directors would like to express their sincere appreciation to the company's Shareholders, Vendors and Stakeholders including Banks, Government authorities, other business associates, who have extended their valuable sustained support and encouragement during the year under review. Your Directors also wish to place on record their appreciation for the hard work, solidarity, cooperation and support of employees at all levels. For and on behalf of the Board Bhageria Industries Limited Suresh Bhageria (DIN: 00540285) Chairperson Registered Office: 1002, 10th Floor, Topiwala Centre, Off S. V. Road, Goregaon [ West ], Mumbai - 400 062. 6th May, 2016. |