Directors' Report To The Members, Yours Directors have pleasure in presenting their Twenty-First Annual Report together with the audited statement of accounts for the Financial year ended March 31,2015. 2. BUSINESS PERFORMANCE/STATE OF COMPANY AFFAIRS The sales and other income for the year ended 31st March 2015 were Rs. 43,875.78 lacs as against Rs.37,378.97 lacs in the previous year. The operating profit amounted to Rs.1092.53 lacs as against Loss of Rs. 863.88 lacs in the previous year. The net profit after tax was Rs. 711.61 lacs as against loss of Rs. 601.81 lacs in the previous year. Your company product has been well received in the overseas market and the export turnover has substantially increased to Rs.5402.03 lacs as compared to Rs. 2143.85 lacs in previous year. 3. MATERIAL CHANGES AND COMMITMENTS: New Production Unit near Vijaywada: There were no material changes and commitments affecting the financial position of the Company which occurred between the end of the financial year to which this financial statements relate and the date of this Report except the Company has set up new plant near Vijayawada, Andhra Pradesh for manufacture of cement sheets and other related products which went commercial in May 2015. The plant capacity is 1,80,000 MTperannum. 4. DIVIDEND The Board of Director is pleased to recommend dividend of 15 %(Rs.1.5 per share of Rs. 10 each) for the year ended March 31, 2015. The total outgo on account of dividend, if approved by the shareholders will be Rs.172.62 lacs (including dividend distribution tax). The Register of Members and Share Transfer Books will remain closed from 31st July 2015 to 07th August 2015 ( both days inclusive).The Company's Annual General Meeting has been scheduled on 07th August 2015. 5. RESERVES The Board of Directors does not propose to transfer any amount to there serves. 6. DIRECTORS AND KEY MANAGERIAL PERSONNEL Mr. J.P.Patel, Directors retire by rotation at the forthcoming Annual General Meeting and being eligible, offer himself for reappointment. During the year under review, Mr.D.B.Kasad, Mr.J.G.Awate, Mr.S.Y.Mestry, Mr.S.U.Joshi and Mr.S.U.Koshti were appointed as Independent Director on 08th August 2014 and their appointment, then being one year, would end on 07th August 2015.In the meanwhile, Mr. S.U.Koshti resigned as Director w.e.f. 09th February 2015.The Directors place on record their appreciation of the contribution made by Mr.S.U.Koshti to the progress of the company during his tenure as its Director. At the Board of Directors meeting held on 09th May 2015, the board on the recommendation of Nomination and Remuneration Committee decided to propose to the members reappointment of Mr. D.B.Kasad, Mr. J.G.Awate, Mr. S.Y.Mestry and Mr.S.U.Joshi as Independent Directors for a period of two years from 08th August 2015 to 07th August 2017. At the Extra-Ordinary General Meeting held on 28th March 2015 Ms. S.J.Kotasthane was appointed as Independent director w.e.f. 28.03.2015 to hold the office till the conclusion of 22nd Annual General Meeting to be held in the calendar year 2016. 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 Clause 49 of the Listing Agreement. The Key Managerial Personnel nominated / appointed by the Board of Directors at its meeting held on 10th May 2014 are Mr. J.P.Patel, Executive Chairman, Mr.S.V.Patel, Managing Director, Mr.V.L.Patel, Whole Time Director, Mr.P.L.Patel, Whole Time Director, Mr.M.K.Sharma, Chief Financial Officer and Mr.Jaiwant Rege, Company Secretary. 7. BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board of Directors has carried out an annual performance evaluation of its own performance and that of the Directors and Committees. The Nomination and Remuneration Committee of the Company recommended Evaluation Policy which was adopted by the Board of Directors. The policy provides for evaluation of the Board, the Committees of the Board and individual Directors, including the Chairman of the Board. The Policy provides that evaluation of the performance of the Board as a whole, Board Committees and Directors shall be carried out on an annual basis. During the year, the first Evaluation cycle was completed by the Company internally which included the Evaluation of the Board as a whole, Board Committees and Directors. The exercise was led by the Chairman of Nomination and Remuneration Committee along with an Independent Director. The Evaluation process focused on various aspects of the Board and Committees functioning such as composition of the Board and Committees, experience , performance of duties and governance issues etc. Separate exercise was carried out to evaluate the performance of individual Directors on parameters such as attendance, contribution, independent judgement and guidance and support provided to the management. The results of the Evaluation were shared with the Board, Chairman of respective Committees and individual Directors. 8. NOMINATION AND REMUNERATION POLICY The Board of Directors on the recommendation of the Nomination & Remuneration Committee has framed a Policy for Directors, Key Managerial Personnel and other Senior Managerial Personnel of the Company , in accordance with the requirements of the provisions of Section 178 of the Companies Act, 2013 and Listing Agreement. The Nomination and Remuneration Policy is stated in the Corporate Governance Report. The same has also been uploaded on the website of the company under the web link viz,<http://www.silworld.in/index.php> /about-us/investors-room/policy. 9. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES During the year four Board Meetings, four Audit Committee Meetings, two Nomination and Remuneration Committee Meeting, two Corporate Social Responsibility Committee Meeting, One Risk Management Committee Meeting and One Stakeholder Relationship Committee Meeting 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 underthe Companies Act, 2013. 10. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to the requirement clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, your Directors confirm that: (a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating followed along with proper explanation relating to material departures; (b) 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 and loss of the Company for that period; (c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (d) they have prepared the annual accounts on a going concern basis; (e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively, and (f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 11. 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. Further there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. All Related Party Transactions are placed before the Audit Committee as also the Board of Directors for approval. The policy on Related Party Transactions as approved by the Board has been uploaded on the Company's website. The form AOC-2 is annexed herewith as Annexure'A'. 12. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations. 13. AUDITORS a. Statutory Auditor's The Company's Auditors, M/s Parag Patwa and Associates, Chartered Accountants, Pune who retire at the ensuing Annual General Meeting of the Company are eligible for reappointment. They have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder for reappointment as Auditors of the Company. b. Cost Auditors Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of production of Cement Products & power generation are required to be audited. The Board of Directors of the Company on the recommendation of Nomination and Remuneration Committee has appointed Messrs Nimkar Mohini & Associates to audit the cost accounts of the Company for the financial year 2015-16 on a remuneration of Rs.35,000/-plus Service Tax as applicable. As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member's ratification for the remuneration payable to Messrs Nimkar Mohini and Associates., Cost Auditors is included at Item No. 5 of the Notice convening the Annual General Meeting. c. Secretarial Audit Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. P.L. Shettigar, Company Secretary in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as "Annexure B" and forms an integral part of this Report. 14. AUDITORS AND SECRETARIAL AUDITORS REPORT Referring to clause f (3) of Independent Auditor's Report and Clause 7(d) of the annexure to the Independent Auditor's Report both dated 09.05.2015 as well as in Secretarial Audit Report dated 09.05.2015 there was a nominal delay due to oversight of 17 days in transferring the amount of unpaid/unclaimed dividend to Investor Education and Protection Fund (IEPF) established by the Central Government. 15. ENERGY CONSERVATION, TECHNOLOGY-ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure C". 16. 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 D and forms an integral part of this Report. 17. DEPOSITS The Company has not accepted any fixed deposits from public and, as such, no amount of principal or interest was outstanding as of the Balance Sheet date. 18. RISK MANAGEMENT POLICY The Company has adopted the Risk Management Policy after identifying the following elements of risks which in the opinion of the Board may threaten the very existence of the Company itself. The Risk Management Policy has been uploaded on the website of company under the weblink <http://www.silworld.in/index.php/about->us/investors-room/policy. 19. CORPORATE SOCIAL RESPONSIBILITY (CSR) The Board on recommendation of CSR Committee had approved the CSR policy. The CSR Committee consists of Mr.S.V.Patel-Chairman,Mr.J.P.Patel-Member and Mr. S.U.Joshi-Member. The CSR policy is uploaded on Company's website under the <http://www.silworld.in/index.php/about->us/investors-room/policy.The Report on CSR Activities as required under Companies(Corporate Social Responsibility Policy) Rules,2014 is set out as Annexure E forming part of this Report. 20. STATEMENT PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH RULE 5(2) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014 In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules is provided in the Annual Report. 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 is provided in the Annual Report as Annexure F which forms a part of this Report. 21. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS. The Board members are provided with necessary documents/brochures, reports and internal policies to enable them to familiarise with the Company's procedures and practices. 22. INTERNAL FINANCIAL CONTROLS The Company has put in place an adequate system of internal financial controls with respect to the financial statement and commensurate with its size and nature of business which helps in ensuring the orderly and efficient conduct of business. No reportable material weakness in the operation was observed. 23. VIGIL MECHANISM/WHISTLE BLOWER POLICY The Company has formulated and published a Whistle Blower Policy to provide Vigil Mechanism for employees including directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and Clause 49 of the Listing Agreement. The Whistle Blower Policy is uploaded on the website of the Company under the weblink <http://www.silworld.in/index.php/about->us/investors-room/whistle-blower-policy. 24. AUDIT COMMITTEE The composition of the Audit Committee is provided in Corporate Governance Report and forms a part of this Annual Report. There has been no instances of non acceptance of any recommendations of the Audit Committee by the Board during the financial year under review. 25. LOANS, GUARANTEES OR INVESTMENTS The Company has not given any loan to or provided any guarantee or security in favour of other parties. The Company has also not made any investment of its fund with any other party. 26. AWARD On 06th February2015 the Company was awarded the India CSR Community Initiative Award for its novel, innovative and green 'Cemply Swachalay' toilet block at the Indian Sanitation Summit held in Delhi. 27. ACKNOWLEDGMENT We thank our customers, vendors, investors and bankers for their continued support during the year. We are grateful to the various state governments & local authorities for their continued co operation. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support. On Behalf of the Board of Directors of SAHYADRI INDUSTRIES LIMITED Jayesh Patel Chairman(DIN: 00131517) Satyen Patel Managing Director (DIN: 00131344) Pune, May 9, 2015 |