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Directors Report of Khoday India Ltd.

Mar 31, 2016

The Directors present the 50th Annual Report on the working of your Company and the Audited Statement of Account for the year ended 31st March 2016 :

Financial Highlights (Stand Alone):

(Rs.in Lakhs)

SI. No.

Particulars

2015-16

2014-15

1.

Revenue from operations Other Income

20039.83

271.27

15945.70

55.65

2.

Total Revenue

20311.10

16001.35

3.

Profit /(Loss) before exceptional items and Tax

319.45

(3125.61)

4.

Exceptional item

-

256.68

5.

Profit / (Loss) after exceptional items but before tax

319.45

3382.29

6.

Provision for Taxation Current Tax

-

-

7.

Profit/(Loss)after Tax LESS: Income Tax for the earlier years

LESS: Prior year adjustments

319.45

1.01

-

(3382.29)

0.72

3.46

8.

Net Profit/(Loss)for the year

318.44

(3386.47)

9.

Appropriation Dividend

Dividend Tax

-

-

-

-

10.

Balance carried forward

318.44

(3386.47)

11.

EPS-Basic & Diluted

0.95

(9.56)

Review of performance:

The Company has registered net income of Rs.200.39 crores, which represents an increase of 20.43% over the previous year. A net profit of Rs.3.18 crores has been earned, on the back of income of Rs.40.78 crores from Realty Segment, and after setting off the losses incurred during the three quarters.

Dividend:

With view to improve the cash position and thus improve business operations, the management has decided to plough back the entire profit earned. Hence your Directors do not propose any dividend for the year.

Change in nature of business, if any and material changes and commitments:

There has been no change in the nature of business during the financial year.

So also there has been no material change and commitments between 31st March 2016 and 25th May 2015, impacting the financial position of the Company.

Details of significant and material Orders passed by Regulators / Courts :

a) Reduction of paid-up equity share capital:-

During June 2014, the Company filed a petition numbered 132/2014 before the Hon''ble High Court of Karnataka at Bangalore praying for an Order confirming the special resolution passed by the members at the Annual General Meeting held on 30 December 2013 for reduction of paid-up equity share capital by cancelling 39, 31.042 shares held by the public, under Section 100 read with Sections 101 to 105 of the Companies Act, 1956.

The Hon''ble Court vide its Order dated 07th August 2014, allowed the Company''s petition by confirming the said special resolution. Upon filing a certified copy of the said Order with the Registrar of Companies in Karnataka, Bangalore, the Registrar issued the Certificate of Registration dated 12th September 2014, for alteration by reduction of the paid-up equity share capital from Rs.37,59,12,370/- to Rs.33,66,01,950/- . Consequently the entire paid-up share capital of the Company presently held by its promoters and persons belonging to the promoter group.

Subsequently , about 4 weeks thereafter, Securities and Exchange Board of India (SEBI), filed multiple applications before the same Court for (i) impleading itself in the Company''s petition and (ii) recall and stay of the Order dated 07-082014, which were all dismissed by the Court vide its subsequent Order dated 21-09-2015. Although SEBI has filed an appeal before the Division Bench of the same Court, which is pending adjudication, the said Order has not been stayed and is in force as an Order-in-rem.

In the mean while, the Company''s consistent efforts to implement the Court''s Order by fixing the Record Date first on 29-09-2014 and subsequently on 10-10-2014, 07-12-2014, 07-04-2015, 22-06-2015 and 13-10-2015 for the purpose of drawing up the list of erstwhile public shareholders entitled to payment in respect of the shares so cancelled, have not so far been accepted by BSE Limited, reportedly at the instance of SEBI.

The Orders of the Court as detailed above, do not impact the going concern status or the Company.

b) Listing Agreement with stock exchanges

The Company has complied with the requirements of regulatory authorities on capital markets and no penalties have been imposed during the last three years. However, in the matter of compliance with the requirement of minimum public shareholding under Rule 19 (2)(b) and 19(A) of Securities Contract (Regulation) Rules 1957, read with Clause 40(A) of the Listing Agreement, the Securities and Exchange Board of India (SEBI) vide its final order dated 24th July 2014 confirmed its interim order dated 04* June 2013, vide which i) the voting right in respect of shares held by the persons in the promoters/ promoter group of the Company was frozen and restricted to 1/3 of the entitlement, i.e. to the extent of 31.38 % ii) the buying and selling or otherwise dealing in securities of the Company held by the promoters was prohibited and iii) the promoters and directors of the Company were restrained from holding any new position as a director in any listed company.

The Company has already challenged the Order of SEBI in an Appeal filed before Securities Appellate Tribunal, on the strength of the Order dated 07th August 2014 (as reinforced vide the subsequent Order dated 21-09-2015) passed by the Hon''ble High Court of Karnataka. The appeal is pending adjudication.

Internal Control Systems:

The Company has an adequate system of internal financial controls and procedures commensurate with the size and nature of business which was revised w.e.f.

01-04-2015. these procedures are designed to ensure that all the assets are safeguarded protected against loss and all transactions authorized, recorded and reported correctly. The internal control systems of the Company are monitored, reviewed and evaluated periodically by the members of the Audit Committee.

Deposits:

The Company did not accept any deposits from the public during the year. Further, there were no outstanding deposits pending repayment.

Directors :

Changes in Directors:

There was no change in the Board of Directors of the Company during the financial year. However, it is informed with deep regret that Prof.L.R.Vagale, an Independent Director and Member of Audit Committee, passed away on 09-042016. Mr.KhajaAfzaluddin Sheriff was appointed as an Independent Director in the vacancy, caused by the demise of Prof.L.R.Vagale

Re-appointment of directors retiring by rotation:

In accordance with Article 37(A) of the Articles of Association of the Company Mr.K.R.Nithyanand and Mr.K.H.Gurunath the Non-Executive Directors retire by rotation and being eligible have offered to be re-appointed at the ensuing Annual General Meeting.

Continuance of appointment of Mr,K.L.Swamy, Executive Director

Mr,K.L.Swamy and was re-appointed as Executive Director of the Company for a period of 5 years from 26th April 2014 to 25th April 2019, pursuant to the Special Resolution passed by the Members of the Company at the Annual General Meeting held on 26th December 2014. In accordance with Section 196

(3) of the Companies Act, 2013, the continuance of a Whole-time Director of a Company beyond 70 years of age requires the approval of the Members of the company Even though, Mr, Swamy is 70 years of age, his vast and rich experience in helming the Company Combined with his undiminished business acumen and skills are essential for the Company’s business. Mr, Swamy’s continuance as Executive Director for the remainder of the Current term of appointment, after 18-09-2016 is subject to the approval by the Members by a Special Resolution, in terms of Section 196(2) of the Companies Act, 2016. The Terms and Conditions of his appointment already approved by the Members, remains unchanged.

Appointement of Mr,KhajaAfzaluddin Sheriff as Director:

Mr, KhajaAfzaluddin Sheriff was appointed as Director in the category of Independent Directors, w.e.f. 28-05-2016 in the vacancy caused by the demise of Prof.L.R. Vagale,.Mr, KhajaAfzaluddin Sheriff who continues in office only up to the date fo the ensuing Annual General Meeting, has expressed his willingness to continue in office and the Company has also received a notice under Section 160 of the Companies Act, 2013, from a member of the Company along with the required deposit proposing the candidature of Mr, KhajaAfzaluddin Sheriff for the office Director.

The particulars of all the above Directors proposed to be re-appointed are given in the separate section relating to report on Corporate Governance.

Form No.AOC-2

( Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the companies ( Accounts) Rules, 2014)

Form AOC -2, giving details of transactions with related parties, is attached to this report,

Whistler Blower Mechanism:

The Company has a Whistier Blower Policy in place for vigil mechanism., as mandated by Regulation 4(2)(d)(iv) of SEBI ( LO&DR) Regulations 2015.

Statutory Auditors:

M/s Rangaraju& Associates, Chartered Accountants ( Firm Registration no.6912S), were re-appointed as Independent Statutory Auditors of the Company at the annual General Meeting Held on 29-12-2014 for the residuary term of 3 years in accordance with Section 139(2) read with Rule 6(3) of the Companies ( Audit and Auditors ) Rules 2014 and the Same is proposed to be ratified at the ensuing annual General Meeting.

Auditors) Rules 2014 and the same is proposed to be ratified at the ensuing Annual General Meeting.

Secretarial Auditor

The provisions of Section 204 read with Section 134(3) of the Companies Act, 2013, mandates Secretarial Audit to be conducted from the financial year commencing on or after 1st April 2015 by a Company Secretary in Practice. The Board at its meeting held on 13-02-2016 has therefore appointed Mr. P. NarasimhaPai(Certificate of Practice No. 11629) as the Secretarial Auditor for the financial year ended 31st March 2016. The Secretarial Auditor''s Report for the financial year ended 31st March 2016 is annexed to this Board''s Report.

Transfer to Investor Education & Protection Fund

The Company does not carry any amount representing unpaid and unclaimed dividend, unpaid interest on debentures, unpaid deposits etc., of the nature specified under Section 125 of the Companies Act, 2013.

Share Capital

As stated in the foregoing paragraphs, the Hon''ble High Court of Karnataka at Bangalore vide its Order dated 07-08-2014, confirmed the special resolution passed by the members at the Annual General Meeting held on 30th December 2013 for reduction of paid-up equity share capital by canceling 39,31.042 shares held by the public, under Section 100 read with Sections 101 to 105 of the Companies Act, 1956. Upon registration of the said Order by the Registrar of Companies in Karnataka, Bangalore, vide Certificate dated 12th September 2014, the paid-up equity share capital of the Company stands reduced from Rs.37,59,12,370/- to Rs.33,66,01,950/-, divided into 3,36,60,195 equity shares of Rs.l0/-each . The entire paid-up share capital of the Company is presently held by its promoters and persons belonging to the promoter group.

Details of Managerial Remuneration pursuant to Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014:-

During the financial year, the Company did not pay any remuneration to any of its executive, non-executive and independent directors, excepting sitting fee paid to independent directors for attending meetings of the Board and the Committees thereof. The details of sitting fee paid are given in Corporate Governance Report annexed hereto.

There were 385 permanent employees on the rolls of the Company as at 31st March

2016.

No employee of the Company was in receipt of a remuneration exceeding Rs.5 lakhs per month or Rs.60 Lakhs per annum during the financial year.

During the financial year, no increase was effected in the salary of Chief Operations Officer, Company Secretary or any Manager of the Company.

It is affirmed that the remuneration paid to the employees at all levels is as per the remuneration policy of the company.

Particulars of loans, guarantees or investments:

During the financial year the Company has not given any loan or extended any guarantee to any person. So also no fresh investment of the nature specified in Section 186 of the Companies Act, 2013, was made by the Company.

Conservation of energy, technology absorption, foreign exchange earnings and outgo, if any:

The information with respect to Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo is furnished at Annexure ''A''.

Industrial Relations:

Industrial Relations were cordial throughout the year under review. Your Directors appreciate the dedicated services and co-operation of employees at all levels.

Corporate Governance:

A separate section on Corporate Governance is included as Annexure "B" to the Director''s Report. The Company has complied with the requirements of Corporate Governance as stipulated in Regulation 27 of the SEBI (LO&DR) Regulations 2015. The Certificate obtained from the Company''s Auditors on compliance with Corporate Governance requirements is annexed thereto.

Directors'' Responsibility Statement-

Pursuant to the provisions of Section 134 (5) of the Companies Act, 2013,

(the Act) your Directors state that:-

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there were no material departures;

ii. the accounting policies selected by them were applied consistently, judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March 2016 and of the profit earned by the Company for the period ended the said date;

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. The annual accounts have been prepared on a going concern basis.

v. 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.

vi. The Directors devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Acknowledgements:

Your Directors thank the customers, vendors, bankers, financial institutions,

Central and State Governments for their continued support and co-operation

Extended to the Company.

For and on behalf of the Board of Directors

For Khoday India Limited

Date: 28th May 2016 K.L.Ramachandra

Place: Bangalore Chairman


Mar 31, 2015

Dear Members,

The Directors present the 58th Annual Report together with the Audited Financial Statements for the year ended 31st March, 2016.

(Rs. in lacs)

FINANCIAL RESULTS:

Year ended 31.03.2016

Year ended 31.03.2015

Gross Operational Income

9,947.53

9,895.73

Less: Excise Duty / Service Tax

553.94

498.91

Net Operational Income

9,393.59

9,396.82

Gross Profit / (Loss)

(60.84)

(444.88)

Less : Depreciation

157.53

146.98

Profit / (Loss) before tax

(218.37)

(591.86)

Less : Provision for Taxation - Deferred (63.60)

- For Earlier Years (3.79)

(67.39)

(178.87)

(55.73)

(234.60)

Profit / (Loss) after taxes

(150.98)

(357.26)

Add: Surplus of previous year

(334.86)

22.40

Add: Transferred from General Reserve

-

Surplus / Deficit available for appropriation

(485.84)

(334.86)

Appropriations :

Proposed Dividend

-

-

Tax on Dividend

-

-

Surplus Carried to Balance Sheet

(485.84)

(334.86)

OPERATIONS

Turnover of the Company during the year 2015-16 was Rs. 9,393.59 lacs as compared to Rs. 9,396.82 lacs during the year 2014-15. The Company''s performance in terms of sales revenue was almost same as last year however there is a significant improvement in the gross margins hence the losses have reduced.

The Company has a healthy order booking for financial year 2016-17.

SHARE CAPITAL

The paid up Equity Share Capital as on 31st March, 2016 was Rs. 3,01,15,860/-. During the year under review, the Company has not issued any shares with or without differential voting rights nor has granted any stock options or sweat equity.

DEPOSITS

During the year under consideration, the Company has not accepted any deposits. There were no unpaid or unclaimed deposits as on 31st March, 2016.

BOARD OF DIRECTORS

Smt. Uma Nevatia, Executive Vice Chairperson of the Company was reappointed as Whole Time Director with effect from 1st April, 2015.

As per the provisions of the Companies Act, 2013 and in terms of the Articles of Association of the Company, Smt. Uma S. Nevatia, Director of the Company retires by rotation and being eligible, offers herself for re-appointment.

The term of office of Shri S. K. Nevatia as Chairman and Managing Director of the Company, has expired on 31st March, 2016. The Board of Directors of the Company on the recommendation of the Nomination & Remuneration Committee have re-appointed Shri S. K. Nevatia as Chairman and Managing Director on the existing terms & conditions for a period of three years w.e.f. 1st April, 2016. Appropriate resolution for the approval of the members has been proposed in the notice for the ensuing Annual General Meeting.

The Company has received the necessary declaration from each Independent Director in accordance with section 149(7) of the Companies Act, 2013, that he meets the criteria of independence as laid out in sub-section (6) of section 149 of the Companies Act, 2013 and the Listing Regulations.

KEY MANAGERIAL PERSONNEL

Shri Alen Ferns, Company Secretary & Compliance Officer of the Company resigned as the Key Managerial Personnel with effect from 15th December, 2015.

Shri A.K. Nemani, Chief Financial Officer of the Company resigned as the Key Managerial Personnel with effect from 10th February, 2016.

Ms. Meenakshi Anchlia, Company Secretary & Compliance Officer of the Company was appointed as the Key Managerial Personnel with effect from 10th February, 2016.

Shri Shyam Aswani, Chief Financial Officer of the Company was appointed as the Key Managerial Personnel with effect from 11th February, 2016.

BOARD MEETINGS

During the year under review the Board of Directors met five times i.e. on 27.05.2015, 13.08.2015, 05.11.2015, 10.02.2016 and 02.03.2016. The details of the Board Meetings are given in the Corporate Governance Report which forms a part of this Annual Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) that in the preparation of the annual financial statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b) that we 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 / (loss) of the Company for that period;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the annual financial statements have been prepared on a going concern basis;

e) that proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively; and

f) that proper internal financial controls were laid down and that such internal financial controls are adequate and were operating effectively.

PERFORMANCE EVALUATION OF THE BOARD

Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, 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 Committees of the Board. The Independent Directors met separately on 2nd March, 2016 to discuss the following:

i) review the performance of Non-Independent Directors and the Board as a whole;

ii) review the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors;

iii) assess the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

All Independent Directors were present at the meeting and discussed the above and expressed their satisfaction.

SUBSIDIARY, JOINT VENTURE OR ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint venture or Associate Companies.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the financial year 2015-16, the Company has not given any loans, guarantees or made any investments as per the provisions of section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

All transactions entered with related parties for the year under review were on arm''s length basis and in the ordinary course of business and that the provisions of section 188 of the Companies Act, 2013 and the rules made there under are not attracted. Thus, disclosure in form AOC-2 in terms of section 134 of the Companies Act, 2013 is not required.

All Related Party Transactions are placed before the Audit Committee. Omnibus approval was obtained on a quarterly basis for transactions which are of repetitive nature. A statement giving details of all Related Party Transactions are placed before the Audit Committee for review and approval on a quarterly basis.

The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company viz. www.hirect.com. None of the Directors has any pecuniary relationship or transactions vis-a-vis the Company.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in form MGT-9, as required under section 92 of the Companies Act, 2013, is annexed as Annexure - A and forms an integral part of this report.

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 M/s. GMJ & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed as Annexure - B and forms an integral part of this report.

The Secretarial Audit Report does not contain any qualifications and adverse remark.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a Vigil Mechanism / Whistle Blower Policy as per the relevant provisions of the Listing Regulations and section 177 of the Companies Act, 2013. The details are given in the Corporate Governance Report which forms a part of this Annual Report. The Vigil Mechanism / Whistle Blower Policy is uploaded on the website of the Company, viz. www.hirect.com

NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel’s and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members.

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 three preceding 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 profit of the Company''s three immediately preceding financial years.

Accordingly, Company has constituted CSR Committee comprising of Shri V. K. Bhartia, Shri S. K. Nevatia and Smt. Uma S. Nevatia as member of the Committee. The Committee is responsible for formulating and monitoring the CSR policy of the Company. Details about the CSR policy are available on our website, viz. www.hirect.com.

Due to average net profit of last three years being negative, your Company is not required to spend any amount of CSR activities during the year under review.

The report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - C and forms an integral part of this report.

AWARDS AND RECOGNITION

The Company has been committed towards ensuring high standards of Environment and Safety practices. It is a matter of great satisfaction that these initiatives taken by the Company have been appreciated at various forums.

The Company received following accolades during the year from "National Society of Friends of the Trees”:

1. "The Annual Vegetable, Fruit & Flower Show" - Full Garden - Rank I

2. Any outstanding specimens of Bonsai - Rank II

3. In collection of Bonsai - Rank III

AUDIT COMMITTEE

An Audit Committee of the Board has been constituted in terms of the relevant provisions of the Listing Resolutions and section 177 of the Companies Act, 2013. Constitution and other details of the Audit Committee are given in the Corporate Governance Report which forms a part of this Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS

As required under Listing Regulations, Management Discussion and Analysis Report forms part of this Annual Report.

AUDITORS

At the Annual General Meeting held on 14th August, 2014, M/s. Khandwala & Shah, Chartered Accountants, were appointed as statutory auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in the calendar year 2017. In terms of the first proviso to section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. Khandwala & Shah, Chartered Accountants, as statutory auditors of the Company, is placed for ratification by the members.

M/s. Khandwala & Shah, Chartered Accountants are eligible for re-appointment and have expressed their willingness to act as Auditors, if appointment ratify. The Company has received a certificate from them that they are qualified under section 139 of the Companies Act, 2013 for appointment as auditors of the Company. The Audit Committee and Board of Directors hence recommend for ratification of their appointment.

The members are requested to consider, approve and ratify their appointment.

M/s. Daga & Chaturmutha, Chartered Accountants, Branch Auditors of the Company for Nashik Plant and M/s. Yogesh N. Shah & Co., Chartered Accountants, Branch Auditors of the Company for Dehradun Plants are retiring at the ensuing Annual General Meeting and being eligible for re-appointment have expressed their willingness to act as Branch Auditors of the Company.

The Members are requested to authorize the Board of Directors to appoint Branch Auditors of the Company and fix their remuneration.

AUDITORS'' OBSERVATIONS

The observations of the auditors contained in their report are self explanatory and therefore, do not call for any further comments. The Audit Report does not contain any qualifications and adverse remark.

DETAILS IN RESPECT OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO FINANCIAL STATEMENTS

Adequate systems for internal controls provide assurances on the efficiency of operations, security of assets, statutory compliance, appropriate authorization, reporting and recording transactions. The scope of the audit activity is broadly guided by the annual audit plan approved by the top management and Audit Committee. The Internal Auditors prepare regular reports on the review of the systems and procedures and monitors the actions to be taken.

RISK MANAGEMENT

The Company has in place a Risk Management Policy which was reviewed by the Audit Committee and approved by the Board of Directors of the Company. The policy provides for a robust risk management framework to identify and assess risks such as operational, strategic, financial, regulatory and other risks and put in place an adequate risk management infrastructure capable of addressing these risks.

CORPORATE GOVERNANCE

As per Regulation 34 (3) read with Schedule V of the Listing Regulations, a separate section on corporate governance practices followed by the Company, together with a certificate from the Company''s Auditors confirming compliance forms an integral part of this Annual Report.

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 and Senior Management Personnel’s of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity.

LISTING

The Company has listed its shares on The Bombay Stock Exchange Ltd. & National Stock Exchange of India Ltd. The Company is regular in payment of listing fees.

LISTING AGREEMENT

The Securities and Exchange Board of India (SEBI), on 2nd September, 2015, issued SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the aim to consolidate and streamline the provisions of the Listing Agreement for different segments of capital markets to ensure better enforceability. The said regulations were effective from 1st December, 2015. Accordingly, all listed entities were required to enter into the Listing Agreement within six months from the effective date. The Company entered into Listing Agreement with BSE Limited and the National Stock Exchange of India Limited during February 2016.

POLICIES

We seek to promote and follow the highest level of ethical standards in all our business transactions guided by our value system. The Listing Regulations mandated the formulation of certain policies for all listed companies. All our Corporate Governance policies are available on our website viz www.hirect.com. The policies are reviewed periodically by the Board and updated based on need and new compliance requirement.

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). The Company has been allotted ISIN No. INE835D01023.

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.

PARTICULARS OF EMPLOYEES

The information required pursuant to section 197(12) read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure - D and forms an integral part of this report.

The information required pursuant to section 197(12) read with rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable because Company has not employed any employee drawing salary of Rs. 5, 00,000/- per month or Rs. 60,00,000/- per annum during the year under review.

DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at workplace with a mechanism of lodging complaints. During the year under review, there were no complaints reported to the Internal Complaint Committees.

INFORMATION ON MATERIAL CHANGES AND COMMITMENTS

There are no material changes and commitments affecting the financial position of the Company which have occurred between 31st March, 2016 and 27th May, 2016 being the date of this report.

PARTICULARS REGARDING CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

The information pursuant to section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed as Annexure - E and forms an integral part of this report.

SAFETY, ENVIRONMENTAL CONTROL AND PROTECTION

The Company has taken all the necessary steps for safety, environmental control and protection at the plants.

ACKNOWLEDGMENT

The Directors wish to convey their appreciation to the Company''s shareholders, customers, suppliers, bankers, distributors and all the technology partners for the support they have given to the Company and the confidence, which they have reposed in its management and the employees for the commitment and dedication shown by them.

Registered Office: For and on behalf of the Board of Directors

Lake Road, Bhandup (W), For Hind Rectifiers Limited

Mumbai - 400 078

Place: Mumbai S. K. Nevatia

Dated: 27th May, 2016 Chairman & Managing Director


Mar 31, 2013

The Directors present the 47th Annual Report on the working of your Company and the Audited Statement of Accounts for the year ended 31st March 2013:

FINANCIAL HIGHLIGHTS (Standalone)

(Rs. in Lakhs)

Particulars 2012-2013 2011-2012

1. Revenue from operations 12400.86 16477.40

Other Income 58.03 176.17

2. Total Revenue 12458.89 16653.57

3. Profit /(Loss) before Tax (2285.54) 1926.26

4. Provision for Taxation

Current Tax 343.00

5. Profit/(Loss)after Tax (2285.54) 1583.26

LESS: Income Tax for the earlier years 19.75 0.48

LESS: Prior year adjustments 7.18 2.50

6. Net Profit/(Loss)for the year (2312.47) 1580.28

7. Appropriation Dividend Dividend Tax

8. Balance carried forward (2312.47) 1580.28

9. EPS - Basic & Diluted (6.15) 4.20

REVIEW OF PERFORMANCE:

Even though your Company''s gross revenue has registered an increase of about Rs.5.45 Crores over the previous year, a net loss of Rs.23.12 Crores has been incurred during the year mainly on account of considerable increase in the quantum of excise duty & interest payments and increase in the overall cost of production.

DIVIDEND:

Your Directors regret the inability to recommend any dividend in view of the loss incurred by the Company during the financial year.

PROCEDURE FOR REDUCTION OF PAID-UP EQUITY SHARE CAPITAL:

A procedure involving reduction of paid-up equity share capital inter-alia under Sec. 100 of the Companies Act 1956, was recommended by the Audit Committee of the Board of Directors of the Company at its meeting held on 24th April 2013, in compliance with the Circular CIR/CFD/DIL/5/2013 dated 4th February 2013 issued by the Securities and Exchange Board of India (SEBI).

The salient features of the Procedure are as follows:

- Presently, 39,31,042 equity shares of the Company constituting 10.46 % of the issued, subscribed and paid-up capital are held by the public.

- The procedure provides for an exit opportunity to the public shareholders by means of Reduction of Capital of Rs.3,93,10,420/- held by them, automatic cancellation of the relative shares and return of the capital amount of Rs.10/- per share together with a premium of Rs.65/-, (aggregating to Rs.75/- per share) which is 2.46 times the fair value of Rs.30.49 per share as certified in the Share Valuation Report dated 30th September 2013 issued by the Independent Chartered Accountant, M/s N.C.Rajagopal & Co., Chennai and 1.48 times the price of Rs.50.64 which is the 26 weeks'' average of the weekly high and low prices of the share as quoted on Bombay Stock Exchange Ltd during the period from 06th May 2013 to 01st November 2013.

- The payment to public shareholders is proposed to be made through direct credit of their bank accounts / cash warrants.

- The implementation of the Procedure is subject to the following:

i) Approval of a special resolution in that behalf in the ensuing Annual General Meeting (AGM) by the majority of public shareholders participating in the voting process through postal ballot as well manually at the AGM.

ii) Confirmation thereafter by the Hon''ble High Court of Karnataka thereafter, on a petition to be filed by the Company.

DIRECTORS:

In accordance with Article 37(A) of the Articles of Association of the Company Prof.L.R.Vagale, Mr.B.K.Ratnakar Rao, Maj.Gen(Retd.) M.K.Paul & Mr.D.V. Sathyanarayana, the independent nonexecutive Directors retire by rotation and being eligible have offered to be re-appointed.

AUDITORS :

M/s Rangaraju & Associates, Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a letter from them to the effect that their reappointment, if made, would be within the prescribed limits u/s 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such reappointment within the meaning of Section 226 ibid.

REMARKS OF AUDITORS:

Delay in payment of statutory dues and default in timely repayment of principal and interest dues to banks.

COMMENTS ON REMARKS OF AUDITORS:

The delay in remittance towards Professional Tax, Employee State Insurance, Provident Fund and Value Added Tax and the default in timely repayment of principal and interest dues to banks occurred due to unavoidable circumstances.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO, IF ANY:

The information required to be furnished Under Section 217(1)(e) of the Companies Act, 1956, is at Annexure ''A''.

PARTICULARS OF EMPLOYEES UNDER THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975, AS AMENDED:

No employee of the Company was in receipt of a remuneration exceeding Rs.5 Lakhs per month or Rs.60 Lakhs per annum, during the financial year.

INDUSTRIAL RELATIONS:

Industrial Relations were cordial throughout the year under review. Your Directors appreciate the dedicated services and co-operation of employees at all levels.

CORPORATE GOVERNANCE:

A separate section on Corporate Governance is included in the Annual Report. The Company has complied with the requirements of Corporate Governance as stipulated in clause 49 of the Listing Agreement. The Certificate obtained from the Company''s Auditors on compliance with Corporate Governance requirements is annexed thereto.

Exemption from attaching the balance sheet of Company''s wholly owned subsidiary M/s. Khoday Properties Private Limited.

The Company has availed exemption from attaching to its own balance sheet, the balance sheet of Company''s wholly owned subsidiary M/s. Khoday Properties Private Limited pursuant to General Circular 02/2011 dated 08th February 2011 issued by the Ministry of Corporate Affairs under Section 212 of the Companies Act, 1956. In compliance therewith, your directors undertake to provide such information as may be sought by the Company''s shareholders about the accounts of Khoday Properties Private Limited for the financial year 2012-13 .Copies of the audited balance sheet of Khoday Properties Private Limited as at 31st March 2013 and the statement of profit and loss for the year ended on that date have been kept for inspection by the Company''s shareholders, both at the Registered Office of the Company and that of Khoday Properties Private Limited. A statement pursuant to Sec 212(8) is annexed at page no. 106

DIRECTORS'' RESPONSIBILITY STATEMENT:

Your Directors further report that:-

i. in the preparation of the annual accounts, the applicable accounting standards have been followed and that there were no material departures;

ii. the accounting policies selected by them were applied consistently, judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March 2013 and of the loss incurred by the Company for the period ended 31st March 2013;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis.

ACKNOWLEDGEMENTS:

Your Directors thank the customers, vendors, investors, bankers, financial institutions, Central and State Governments for their continued support and co-operation extended to the Company.

for and on behalf of the Board of Directors

for KHODAY INDIA LIMITED

Date : 05th November 2013 K.L. RAMACHANDRA

Place: Bangalore CHAIRMAN


Mar 31, 2011

REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

The Directors present the 45th Annual Report on the working of your Company and the Audited Statement of Accounts for the year ended 31st March 2011:

FINANCIAL HIGHLIGHTS (Standalone): (Rs. in Lakhs)

Particulars 2010-2011 2009-2010

1. Gross Income 32631.17 31785.25

Less: Excise Duty 18556.91 17061.40

2. Net Income 14074.26 14723.85

3. Profit/(Loss) before Tax (1292.42) (675.18)

4. Provision for Taxation

Current Tax - -

5. Profit/(Loss) after Tax (1292.42) (675.18)

LESS : Income Tax for the earlier years (37.00) 131.06

LESS : Prior year adjustments (3.50) (13.85)

6. Net Profit (Loss) for the year (1332.92) (557.97)

7. Appropriation Dividend

Dividend Tax - -

8. Balance carried forward 831.75 501.17

831.75 501.17

9. EPS - basic & diluted (3.55) (1.48)

REVIEW OF PERFORMANCE:

Even though your Company's gross income has registered an increase of about Rs.8.45 Crores over the previous year, a loss of Rs. 13.32 Crores has been incurred during the year mainly on account of increase in the quantum of excise duty and interest payments as well as considerable increase in the overall cost of production.

DIVIDEND:

Your Directors regret the inability to recommend any dividend in view of the loss incurred by the Company during the financial year.

DIRECTORS:

i) Your Directors note with profound sorrow, the sudden and untimely demise of their colleague on the Board Mr.D.V.Tikekar on 4th September 2011. The Board of Directors at its meeting held on 23rd September 2011, appointed Mr.Puranic Ramachar Ananda Murthy as Director in the Casual Vacancy caused by the demise of Mr.Tikekar, under Section 262 of the Companies Act, 1956. Mr.Ananda Murthy will hold office until the date of Annual General Meeting to be held in the year 2012, i.e. the date upto which Mr.Tikekar would have been in office.

ii) The Board of Directors at its meeting held on 23rd September 2011 also appointed Mr. Damam Vittalsa Sathyanarayana as Additional Director pursuant to Article 30 of the Articles of Association of the Company. Mr. Sathyanarayana holds office only up to the ensuing Annual General Meeting under Section 260 of the Companies Act, 1956, and he has expressed his willingness to continue in office. The Company has since received a notice under Section 257 of the Companies Act, 1956, from a member proposing the candidature of Mr.Sathyanarayana for the office of Director.

iii) In accordance with Article 37(A) of the Articles of Association of the Company Maj.Gen(Retd.) M.K.Paul and Mr.K.L.Ramachandra, Directors retire by rotation and being eligible have offered to be re-appointed.

iv) In accordance with Section 317 of the Companies Act, 1956, the present term of office of Mr.K.L.Srihari, who was appointed as Vice-Chairman and Managing Director for a period of five years has ceased on 31st December 2010. Similarly the present term of office of Mr.K.LA.Padmanabhasa, who was appointed as Joint Managing Director for a period of five years has also ceased on 31st December 2010. Hence, at the Board Meeting held on 6lh September 2010, your Directors have reappointed Mr.Srihari as Vice- Chairman and Managing Director & Mr.K.L.A.Padmanabhasa as Joint Managing Director for a further period of 5 years, subject to the consent of the members for their respective re-appointments and the terms thereof, at the ensuing Annual General Meeting.

AUDITORS:

M/s Rangaraju & Associates, Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a letter from them to the effect that their re-appointment, if made, would be within the prescribed limits u/s 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such re-appointment within the meaning of Section 226 ibid.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO, IF ANY:

The information required to be furnished Under Section 217(1)(e) of the Companies Act, 1956, is at Annexure 'A.

PARTICULARS OF EMPLOYEES UNDER THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975, AS AMENDED:

No employee of the Company was in receipt of remuneration exceeding Rs.5 Lakhs per month or Rs.60 Lakhs per annum, during the financial year.

INDUSTRIAL RELATIONS:

Industrial Relations were cordial throughout the year under review. Your Directors appreciate the dedicated services and co-operation of employees at all levels

CORPORATE GOVERNANCE:

A separate section on Corporate Governance is included in the Annual Report. The Company has complied with the requirements of Corporate Governance as stipulated in clause 49 of the Listing Agreement. The Certificate obtained from the Company's Auditors on compliance with Corporate Governance requirements is annexed thereto.

EXEMPTION FROM ATTACHING THE BALANCE SHEET OF COMPANY'S WHOLLY OWNED SUBSIDIARY M/S. KHODAY PROPERTIES PRIVATE LIMITED.

The Company has availed exemption from attaching to its own balance sheet, the balance sheet of Company's wholly owned subsidiary M/s. Khoday Properties Private Limited pursuant to General Circular 02/2011 dated 08,h February 2011 issued by the Ministry of Corporate Affairs under Section 212 of the Companies Act, 1956. In compliance therewith, your directors undertake to provide such information as may be sought by the Company's shareholders about the accounts of Khoday Properties Private Limited for the financial year 2010-11 .Copies of the audited balance sheet of Khoday Properties Private Limited as at 31st March 2011 and profit and loss account for the year ended on that date have been kept for inspection by the Company's shareholders, both at the Registered Office of the Company and that of Khoday Properties Private Limited.

DIRECTORS' RESPONSIBILITY STATEMENT:

Your Directors further report that:-

i. in the preparation of the annual accounts, the applicable accounting standards had been followed and that there were no material departures;

ii. the accounting policies selected by them were applied consistently, judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March 2011 and of the profit of the Company for the period ended 31st March 2011;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis.

ACKNOWLEDGEMENTS:

Your Directors thank the customers, vendors, investors, bankers, financial institutions, Central and State Governments for their continued support and co-operation extended to the Company.

for and on behalf of the Board of Directors

for KHODAY INDIA LIMITED

Place: Bangalore K.L. RAMACHANDRA

Date: 23-09-2011 CHAIRMAN


Mar 31, 2010

The Directors take pleasure in presenting the 44th Annual Report on the working of your Company and the Audited Statement of Accounts for the year ended 31st March 2010:

FINANCIAL HIGHLIGHTS (Standalone): (Rs. in Lakhs)

Particulars 2009-2010 2008-2009

1. Gross Income 31785.25 24215.61

Less: Excise Duty 17061.40 11625.22

2. Net Income 14723.85 12590.39

3. Profit Before Tax (675.18) (289.09)

4. Provision for Taxation

Current Tax - -

Fringe Benefit Tax - 29.69

5. Profit after Tax (675.18) (318.78)

ADD : Income Tax for the earlier

years 131.06 -

LESS : Prior year adjustments (13.85) (29.69)

6. Net Profit for the year (557.97) (348.47)

7. Appropriation Dividend

Dividend Tax - -

8. Balance carried forward 501.17 1059.14

501.17 1059.14

9. EPS - basic & diluted (1.48) (0.93)

REVIEW OF PERFORMANCE:

Even though your Companys gross income has registered an increase of about 31% over the previous year, a loss of Rs.5.57 Crores has been incurred during the year mainly on account of hike in the quantum of excise duty payment owing to enhanced rates of duty and considerable increase in the overall cost of production. However, there is a significant increase in the value of stock under maturation process, the revenue from which will be realized in due course.

DIVIDEND:

Your Directors regret the inability to recommend any dividend in view of the loss incurred by the Company during the financial year.

DIRECTORS:

In accordance with Article 37(A) of the Articles of Association of the Company, Prof. L.R. Vagale and Mr.Bangra Kulur Ratnakar Rao, Directors retire by rotation and being eligible have offered to be re-appointed.

AUDITORS:

M/s Rangaraju & Associates, Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a letter from them to the effect that their reappointment, if made, would be within the prescribed limits u/s 224(1 B) of the Companies 1956, and that they are not disqualified for such reappointment within the meaning of Section 226 ibid.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO, IF ANY:

The information required to be furnished Under Section 217(1)(e) of the Companies Act, 1956, is at Annexure A.

PARTICULARS OF EMPLOYEES UNDER THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975

A statement containing the particulars of employees in terms of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 1975 is attached as Annexure B and forms an integral part of this Report.

INDUSTRIAL RELATIONS:

Industrial Relations were cordial throughout the year under review. Your Directors appreciate the dedicated services and co-operation of employees at all levels

CORPORATE GOVERNANCE:

A separate section on Corporate Governance is included in the Annual Report. The Company has complied with the requirements of Corporate Governance as stipulated in clause 49 of the Listing Agreement. The Certificate obtained from the Companys Auditors on compliance with Corporate Governance requirements is annexed thereto.

DIRECTORS RESPONSIBILITY STATEMENT:

Your Directors further report that:-

i. in the preparation of the annual accounts, the applicable accounting standards had been followed and that there were no material departures;

ii. the accounting policies selected by them were applied consistently, judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March 2010 and of the loss of the Company for the period ended 31st March 2010;

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis.

ACKNOWLEDGEMENTS:

Your Directors thank the customers, vendors, investors, bankers, financial institutions, Central and State Governments for their continued support and co-operation extended to the Company.

for and on behalf of the Board of Directors

for KHODAY INDIA LIMITED

Date: 06-09-2010 K.L RAMACHANDRA

Place: Bangalore CHAIRMAN

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