Mar 31, 2023
DIRECTORSâ REPORT
Your Directors hereby present their 39th Annual Report along with Audited Financial Statements for the year ended March 31,2023.
Particulars |
Year E |
nded |
Year E |
nded |
Revenue from Operations |
||||
Gross |
1,40,370.26 |
1,04,789.66 |
||
Net of Excise Duty |
1,40,370.26 |
1,04,789.66 |
||
Other Income |
225.72 |
90.03 |
||
Profit before Finance Costs, |
||||
Depreciation and Amortisation |
||||
Expense & Tax Expenses |
13,026.31 |
5,959.71 |
||
Finance Costs |
652.92 |
528.81 |
||
Profit before Depreciation and |
||||
Amortisation Expense & Tax Expenses |
12,373.39 |
5,430.90 |
||
Depreciation and Amortisation Expense |
1,414.15 |
1,296.50 |
||
Profit before Tax Expenses |
10,959.24 |
4,134.40 |
||
Tax expenses - Current Tax |
2,970.00 |
1,149.00 |
||
- Deferred Tax |
(151.79) |
2,818.21 |
(77.94) |
1,071.06 |
Profit after Tax Expenses |
8,141.03 |
3,063.34 |
||
Balance brought forward |
11,126.95 |
8,065.74 |
||
Other Comprehensive Income |
(0.52) |
(2.13) |
||
Surplus carried forward |
19,267.46 |
11,126.95 |
Your Company reported a top-line growth of 33.95% over the
Previous year. The Net Revenue from operations stood at
'' 1,40,370.26 Lakhs compared with '' 1,04,789.66 Lakhs in the
Previous Year. The Operating Profit before tax stood at
'' 10,959.24 Lakhs as against '' 4,134.40 Lakhs in the Previous
Year. The Net Profit for the year stood at '' 8,141.03 Lakhs
against '' 3,063.34 Lakhs reported in the Previous Year.
The company continues to retain and reinforce its market
leadership in modified thermoplastics with a pan India network
of operations having plants and warehouses situated in auto
hubs and industrial belts.
There are no material changes or commitments affecting the
financial position of the Company which have occurred
between the end of the financial year and the date of this
Report.
Detailed analysis of the State of the Companyâs affairs and
performance during the year is provided in Annexure to this
report under Managementâs Discussion and Analysis Report.
In order to conserve resources, your Directors have decided not
to recommend any dividend for the financial year under review.
Pursuant to Regulation 43A of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 (âthe Listing
Regulationsâ), the Dividend Distribution Policy duly
approved by the Board is available on the website of the
Company viz. www.kingfaindia.com and can be accessed at
http://www.kingfaindia.com/DDPolicy1.pdf
As on March 31, 2023 the reserves and surplus stood at
'' 45,388.20 Lakhs as compared to '' 37,247.69 Lakhs as on
March 31,2022. Your Directors do not propose to transfer any
amount to the reserves.
The paid up equity capital of the Company stood at '' 1,211.05
Lakhs. The Company has not issued shares with differential
voting rights nor granted stock options nor sweat equity.
Cash and cash equivalents as at March 31,2023 was '' 239.54
Lakhs. The company continues to focus on judicious
management of its working capital, receivables, inventories and
other working capital parameters were kept under strict check
through continuous monitoring.
Your Company has not accepted any deposits within the
meaning of the Companies Act, 2013 and the Companies
(Acceptance of Deposits) Rules, 2014.
PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS
The Company has not given any loans or guarantees nor has
made any Investments covered under the applicable provisions
of the Companies Act, 2013.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate
with the size, scale and complexity of its operations. The
Company has appointed independent professional audit firm to
carry out internal audit at all its locations. The scope of its
Internal Audit program is laid down by the Audit committee of the
Board of Auditors. To maintain its objectivity and independence,
the Internal Audit function reports to the Audit Committee of the
Board.
The Internal Audit team monitors and evaluates the efficacy and
adequacy of internal control system in the Company, its
compliance with operating systems, accounting procedures
and policies at all locations of the Company. Based on the report
of internal audit function, process owners undertake 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 of Directors.
There was no instance of fraud during the year under review,
which required the Statutory Auditors to report to the Audit
Committee and / or Board under Section 143(12) of Act and
Rules framed thereunder.
CORPORATE SOCIAL RESPONSIBILITY
As a part of its initiative under the âCorporate Social
Responsibilityâ (CSR) drive, the Company has undertaken
projects which are in accordance with the Companies Act, 2013
and the Companyâs CSR policy. The Report on CSR activities
as required under the Companies (Corporate Social
Responsibility Policy) Rules is annexed as Annexure - I and
forms an integral part of this Report.
ENVIRONMENT, HEALTH AND SAFETY
The facilities of the Company has ISO 9001:2015 and IATF
16949:2016 Certifications.
Your Companyâs policy require the conduct of all operations in
such a manner so as to ensure safety of all concerned,
compliance of statutory and industrial requirements for
environment protection and conservation of natural resources
to the extent possible.
As required by the Sexual Harassment of Women at Workplace
(Prevention, Prohibition & Redressal) Act, 2013 and the Rules
made thereunder, the Company has formulated and
implemented a policy on prevention of sexual harassment at the
workplace with a mechanism of lodging complaints. The
Company has not received any compliant under this policy
during the year under review.
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR
policies to the growing requirements of the business. Reviews,
training and tools are being provided for the personnel to
improve overall efficiency.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Your Director, Mr. Wu Xiaohui (DIN : 06617977) retire by
rotation and being eligible, offers himself for re-appointment.
The Directors recommend Mr. Wu Xiaohui for re-appointment.
Brief details of the Director, proposed to be re-appointed, as
required under SEBI Listing Regulations, are provided in the
Notice of Annual General Meeting.
Mr. Xie Dongming has tendered his resignation from the
position of Chief Financial Officer (CFO) of the Company with
effect from 10th November, 2022 due to change in his roles and
responsibilities in KINGFA Group.
Mr. Chen Xiaoqiong has been appointed as Chief Financial
Officer (CFO) and Key Managerial Personnel (KMP) of the
Company with effect from 10th November, 2022.
Declaration by an Independent Director(s)
The Independent Directors of your Company have given a
declaration confirming that they meet the criteria of
independence as prescribed both under the Act and the Listing
Regulations and the same is complied with Code of Conduct as
per Schedule IV to the Act.
None of the Directors are disqualified from being appointed as
or holding office as Director, as stipulated under Section 164 of
the Act.
As on 31st March, 2023, pursuant to the provisions of the
Companies Act, 2013 and the rules made thereunder, Mr. Bo
Jingen, Managing Director, Mr. D.Balaji, Whole-time Director
designated as Executive Director, Mr. Chen Xiaoqiong, Chief
Financial Officer and Mr. Nirnoy Sur, Company Secretary were
the Key Managerial Personnel of the Company.
FAMILIARIZATION PROGRAM FOR INDEPENDENT
DIRECTORS
All Independent Directors inducted into the Board are
familiarized with the Organisation. The details of such program
are provided in Corporate Governance Report.
NUMBER OF MEETINGS OF THE BOARD
During the year, four Board Meetings were convened and held
on 25th May, 2022, 10th August, 2022, 10th November, 2022
and 14th February, 2023 and details of the same are given in the
Corporate Governance Report which forms part of this Report.
The details of the various Committees of the Board i.e. Audit
Committee, Nomination and Remuneration Committee,
Stakeholder Relationship Committee, Corporate Social
Responsibility Committee and Risk Management Committee
held during the Financial Year 2022 - 23 are provided in the
Corporate Governance Report.
Pursuant to the provisions of the Companies Act, 2013 and
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, the Board has carried out performance evaluation
of its own performance, the directors individually as well as the
evaluation of the working of its Audit, Nomination &
Remuneration and other Committees as required. The
performance evaluation of the Chairman of the Board and
Managing Director / Board / Executive / Non Independent /
Independent Directors was carried out. In the evaluation of the
Directors, the Directors being evaluated had not participated
and the Board evaluation process was completed. The
Directors expressed their satisfaction with the evaluation
process. The manner in which the evaluation has been carried
out has been explained in the Corporate Governance Report.
NOMINATION AND REMUNERATION POLICY
The Board of Directors have framed a broad policy which lays
down a framework in relation to remuneration of Directors, Key
Managerial Personnel and other employees of the Company.
This policy also lays down criteria for selection and appointment
of Board Members. The details of this policy are explained in the
Corporate Governance 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.
DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the
information and explanations obtained by them, your Directors
make the following statement in terms of Section 134(5) of the
Companies Act, 2013:
(i) that in the preparation of the Annual Accounts for
the year ended 31st March, 2023, the applicable
accounting standards had been followed along with
proper explanation relating to material departures;
(ii) the directors had selected such accounting policies
and applied them consistently and made
judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state
of affairs of the Company as at March 31,2023 and
of the profit and loss of the Company for the year
ended on that date;
(iii) that the directors has taken proper and sufficient
care 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;
(iv) the annual accounts had been prepared on a âgoing
concernâ basis.
(v) that 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; and
(vi) that the directors had devised proper systems to
ensure compliance with the provisions of all
applicable laws and that such system were
adequate and operating effectively.
All related party transactions that were entered into during the
financial year were on armâs length basis and were in the
ordinary course of business. The Policy has been uploaded on
the website of the Company viz. www.kingfaindia.com and can
be accessed at http://www.kingfaindia.com/RPTPolicy.pdf.
Form AOC-2 is annexed herewith as Annexure - II and forms an
integral part of this report.
The Company does not have subsidiary.
Commitment to ethical professional conduct is a must for every
employee, including Board Members and Senior Management
personnel of the Company. The Code is intended to serve as a
basis for ethical decision-making in conduct of professional
work. The Code of Conduct has been uploaded on the
website of the Company viz. www.kingfaindia.com
and can be accessed at http://www.kingfaindia.com/
images/pdf/CodeofConduct_Senior_Management_Personnel.
pdf. A Declaration regarding Compliance by Board Members
and Senior Management Personnel is given at the end of this
report.
WHISTLE BLOWER POLICY AND VIGIL MECHANISM
In pursuant to the provisions of the Companies Act and Listing
Regulations, a Whistle Blower Policy and Vigil Mechanism for
Directors and Employees to report genuine concerns has been
established. The Policy has been uploaded on the website of
the Company viz. www.kingfaindia.com and can be accessed at
http://www.kingfaindia.com/images/pdf/WPandVM.pdf
Pursuant to SEBI (Prohibition of Insider Trading) Regulations,
the Company has formulated and adopted a Code for
Prevention of Insider Trading and the same has been uploaded
on the website of the Company viz. www.kingfaindia.com and
can be accessed at http://www.kingfaindia.com/kyc/ITC.pdf
The Companyâs Statutory Auditors, P G BHAGWAT LLP,
Chartered Accountants (Firm Registration Number:
101118W/W100682) were re-appointed as Statutory Auditors of
your Company at the Annual General Meeting held on 22nd
September, 2022 for the second term of five years to hold office
from the conclusion of the 38th Annual General Meeting till the
conclusion of the 43rd Annual General Meeting of the
Company.
Pursuant to the amendments made to Section 139 of the
Companies Act, 2013 by the Companies (Amendment) Act,
2017 effective from May 07, 2018 the requirement of seeking
ratification of the members for the appointment of Statutory
Auditors has been withdrawn from the Statute.
In view of the above, ratification of members for continuance of
their re-appointment at this Annual General Meeting is not being
sought.
There is no audit qualification for the year under review.
As per the provisions of the Companies Act, 2013, the Report
given by the Auditors on the financial statements of the
Company is part of the Annual Report.
Pursuant to the provisions of Section 204 of the Companies Act,
2013 and rules made thereunder, the Company had appointed
Ms. Shaswati Vaishnav, Practicing Company Secretary, ACS
11392, PCS 8675 of M/s.Vaishnav Associates to undertake the
Secretarial Audit of the Company. The Secretarial Audit Report
for the financial year ended March 31, 2023 is annexed
herewith as Annexure - III and forms an integral part of this
Report. There is no secretarial audit qualification for the year
under review.
Mr. K.Suryanarayanan, Cost Accountant (Registration Number
102347) carried out the cost audit during the year under review.
In compliance with the provisions of Section 148 of the
Companies Act, 2013, the Board of Directors, on the
recommendation of Audit Committee, have re-appointed
Mr.K.Suryanarayanan, Cost Accountant (Registration Number
102347) as Cost Auditor to audit the cost accounts of the
Company for the financial year 2023-24. As required under the
Companies Act, 2013, a resolution seeking memberâs approval
for the remuneration payable to the Cost Auditor forms part of
the Notice convening the Annual General Meeting for their
ratification.
The annual return for the year ended 31st March 2023 will be
made available in the Companyâs website viz.
www.kingfaindia.com after it is filed with the Registrar of
Companies.
Business risk evaluation and management is an ongoing
process within the Company. Pursuant to the provisions of
section 134(3)(n) of the Act and regulation 21 of the Listing
Regulations, the Company has constituted a Risk Management
Committee and adopted Risk Management Policy. The details
of the Committee and its role / terms of reference are set out in
the Corporate Governance Report, which forms a part of this
Annual Report.
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 - IV to this Report.
The particulars of employees are not applicable since there are
no employees drawing remuneration more than '' 1,02,00,000/-
per annum (full year) or '' 8,50,000/- p.m. (part of the year).
All the dividends of the earlier years, which have remained
unclaimed, have since been transferred to the Investor
Education and Protection Fund at the expiry of the specified
period(s) as required under Companies Act.
Year |
Date of |
No. of Shareholders |
Total Unclaimed |
Due date for |
2015 - 2016 2021-2022 |
No Dividend |
N.A. |
COMPLIANCE OF SECRETARIAL STANDARDS
The Company has complied with all the applicable Secretarial
Standards.
BUSINESS RESPONSIBILITY AND SUSTANABILITY
REPORT (BRSR)
The Securities and Exchange Board of India (âSEBIâ), in May,
2021, introduced new sustainability related reporting
requirements, Business Responsibility and Sustainability
Report (âBRSRâ) which has replaced Business Responsibility
Report. Further, SEBI has mandated top 1,000 listed
Companies, based on market capitalization, to transition to
BRSR from FY 2022-23 onwards. The Company is pleased to
present its 1st Business Responsibility and Sustainability
Report for FY 2022-23 which is annexed herewith as Annexure
- V and forms an integral part of this Report.
CORPORATE GOVERNANCE AND MANAGEMENTâS
DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Managementâs 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 and Certificate of
Non Disqualification of Directors as stipulated under applicable
regulations of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations.
Your Directors wish to record their appreciation of the continued
support and co-operation from your Companyâs customers,
vendors, bankers and all other stakeholders. Your Company will
continue to build and maintain strong links with its business
partners.
The Directors sincerely appreciate the high degree of
professionalism, commitment and dedication displayed by
employees at all levels. The Directors also place on record their
gratitude to the Members for their continued support and
confidence.
For and on behalf of the Board of DirectorsBO JINGEN D. BALAJI
Managing Director Executive Director
DIN : 06617986 DIN : 08256342
Place : Pune
Date : 24th May, 2023
Mar 31, 2018
The Directors hereby present their 34th Annual Report along with Audited Financial Statements for the year ended March 31, 2018. First year of implementation of Indian Accounting Standards (Ind AS):
This is the first year of implementation of the Indian Accounting Standards (Ind AS). The Financial Statements for the year ended March 31, 2018 have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014. The Financial Statements for the year ended March 31, 2017 have been restated in accordance with Ind AS for comparative information.
FINANCIAL RESULTS (Rs. in Lakhs)
Particulars |
Year Ended March 31, 2018 |
Year Ended March 31, 2017 |
||
Revenue from Operations |
||||
Gross |
61,783.37 |
48,322.45 |
||
Net of Excise Duty |
60,164.24 |
42,712.63 |
||
Other Income |
565.80 |
360.48 |
||
Profit before Finance Costs & |
||||
Depreciation and amortisation expense |
4,685.05 |
2,292.13 |
||
Finance Costs |
204.02 |
216.73 |
||
Profit before Depreciation and |
||||
amortisation expense |
4,481.03 |
2,075.40 |
||
Depreciation and amortisation expense |
622.30 |
305.73 |
||
Profit before Tax |
3,858.73 |
1,769.67 |
||
Tax expenses - Current Tax |
1,170.00 |
382.00 |
||
- Deferred Tax |
224.69 |
1,394.69 |
147.36 |
529.36 |
Profit after Tax Balance brought forward Other Comprehensive Income Surplus carried forward |
2,464.04 732.23 (33.41) 3,162.86 |
1,240.31 (490.57) (17.51) 732.23 |
BUSINESS OPERATIONS
Your Company reported a top-line growth of 27.86% over the Previous Year. The Gross Revenue from operations stood at Rs. 61,783.37 lakhs compared with Rs. 48,322.45 lakhs in the Previous Year. The Operating Profit before tax stood at Rs. 3,858.73 lakhs as against Rs. 1,769.67 lakhs in the Previous Year. The Net Profit for the year stood at Rs. 2,464.04 lakhs against Rs. 1,240.31 lakhs reported in the Previous Year.
The company continues to retain and reinforce its market leadership in modified thermoplastics with a pan India network of operations having plants and warehouses situated in auto hubs and industrial belts.
There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of this Report.
Detailed analysis of the State of the Companyâs affairs and performance during the year is provided in Annexure to this report under Managementâs Discussion and Analysis Report.
DIVIDEND
In view of the setting up of Global Scale Manufacturing and Contemporary Design and Development Center at Chakan Pune, it is necessary to conserve and optimise use of resources for the same. Hence, your Directors have not recommended any dividend for the financial year ended March 31, 2018.
RESERVES
As on March 31, 2018 the reserves and surplus stood at Rs. 29,318.27 Lakhs as compared to Rs. 23,364.23 Lakhs as on March 31, 2017.
RIGHTS ISSUE OF EQUITY SHARES
As the Members are aware that the Rights Issue got opened on March 27, 2017 and closed on April 10, 2017. The Company had issued 19,99,893 equity shares of face value Rs. 10/- each for cash at issue price of Rs. 750/- per equity share including share premium of Rs. 740/- per equity share in the ratio of 18 equity shares for every 91 equity shares held aggregating to Rs. 14,999.20 Lakhs, to the existing Shareholders of the Company.
SHARE CAPITAL
The paid up equity capital of the Company stood at Rs. 1,211.05 lakhs. The Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.
FINANCE
Cash and cash equivalents as at March 31, 2018 was Rs. 132.55 lakhs. The company continues to focus on judicious management of its working capital, receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.
STATUS OF NEW MANUFACTURING FACILITY
The Company has completed the land contouring and appropriate levelling and finalized Contractor for Civil, Electrical, Fire Fighting, HVAC, Water System for construction of Factory Building at Chakan Industrial Area, Phase- 2, MIDC, Village - Vasuli - Shinde, Tal - Khed, Dist - Pune, India and the civil construction work is under process for setting up a green field manufacturing location which would also house a State of Art âTechnical and Product Developmentâ Centre to meet the growing needs of the Company.
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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees nor has made any Investments covered under the provisions of Section 186 of the Companies Act, 2013.
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 function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board and to the 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 at all locations of the Company. Based on the report of internal audit function, process owners undertake 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.
COPORATE SOCIAL RESPONSIBILITY
As a part of its initiative under the âCorporate Social Responsibilityâ (CSR) drive, the Company has undertaken projects which are in accordance with the Companies Act, 2013 and the Companyâs CSR policy. The Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - I and forms an integral part of this Report.
ENVIRONMENT, HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS 18001 certification.
Your Companyâs policy require the conduct of all operations in such a manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.
As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at the workplace with a mechanism of lodging complaints. The Company has not received any complaint under this policy during the year under review.
INDUSTRIAL RELATIONS
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR policies to the growing requirements of the business. Reviews, training and tools are being provided for the personnel to improve overall efficiency.
DIRECTORS
A. Rotation of Director
Your Director, Mr. N.K.Ramaswamy retire by rotation and being eligible, offers himself for re-appointment.
B. Declaration by an Independent Director(s)
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 read with SEBI (LODR) Regulations, 2015.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
All Independent Directors inducted into the Board are familiarized with the Organisation. The details of such program are provided in Corporate Governance Report.
NUMBER OF MEETINGS OF THE BOARD
The details of the number of Meetings of the Board held during the Financial Year 2017 - 18 forms part of the Corporate Governance Report.
COMMITTEES OF THE BOARD
The details of the various Committees of the Board i.e. Audit Committee, Nomination and Remuneration Committee, Stakeholder Relationship Committee, Corporate Social Responsibility Committee and Rights Issue Committee held during the Financial Year 2017 - 18 are provided in the Corporate Governance Report.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015, the Board has carried out performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees as required. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
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 and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance 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.
DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c ) of the Companies Act, 2013:
(i) that in the preparation of the Annual Accounts for the year ended 31st March, 2018, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(ii) the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit and loss of the Company for the year ended on that date;
(iii) that the directors has taken proper and sufficient care 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;
(iv) the annual accounts had been prepared on a âgoing concernâ basis.
(v) that 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; and
(vi) that the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were on armâs length basis and were in the ordinary course of business. The Policy has been uploaded on the website of the Company viz. www.kingfaindia.com. Form AOC-2 is annexed herewith as Annexure - II and forms an integral part of this report.
SUBSIDIARY COMPANIES
The Company does not have subsidiary.
CODE OF CONDUCT
Commitment to ethical professional conduct is a must for every employee, including Board Members and Senior Management personnel of the Company. The Code is intended to serve as a basis for ethical decision-making in conduct of professional work. The Code of Conduct has been uploaded on the website of the Company viz. www.kingfaindia.com. A Declaration regarding Compliance by Board Members and Senior Management Personnel is given at the end of this report.
WHISTLE BLOWER POLICY AND VIGIL MECHANISM
In pursuant to the provisions of the Companies Act, 2013, a Whistle Blower Policy and Vigil Mechanism for Directors and Employees to report genuine concerns has been established. The Policy has been uploaded on the website of the Company.
PREVENTION OF INSIDER TRADING
Pursuant to SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company has formulated and adopted a Code for Prevention of Insider Trading and the same has been uploaded on the website of the Company.
STATUTORY AUDITORS
M/s. P.G.BHAGWAT, Chartered Accountants, (Firm Registration Number 101118W) were appointed as Statutory Auditors of your Company at the Annual General Meeting held on 25th September, 2017 for a term of five consecutive years to hold office from the conclusion of the 33rd Annual General Meeting till the conclusion of the 38th Annual General Meeting of the Company. Their appointment as the Statutory Auditors will be ratified at the ensuing Annual General Meeting pursuant to the provisions of Section 139 of the Companies Act, 2013, and Rules made thereunder. Accordingly, the necessary resolution is being placed before the shareholders for their approval.
There is no audit qualification for the year under review.
As per the provisions of the Companies Act, 2013, the Report given by the Auditors on the financial statements of the Company is part of the Annual Report.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company had appointed Ms. Shaswati Vaishnav, Practicing Company Secretary, ACS 11392, CP No. 8675 of M/s.Vaishnav Associates to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure - III and forms an integral part of this Report. There is no secretarial audit qualification for the year under review.
COST AUDIT
Mr.K.Suryanarayanan, Cost Accountant (Registration Number 102347) carried out the cost audit during the year under review.
In compliance with the provisions of Section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of Audit Committee, have appointed Mr.K.Suryanarayanan, Cost Accountant (Registration Number 102347) as Cost Auditor to audit the cost accounts of the Company for the financial year 2018-19. As required under the Companies Act, 2013, a resolution seeking memberâs approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their ratification.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure - IV.
BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within the Company. The Assessment is periodically examined by the Board.
STATUTORY INFORMATION
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 - V to this Report.
The particulars of employees are not applicable since there are no employees drawing remuneration more than Rs. 96,00,000/per annum (full year) or Rs. 8,00,000/- p.m. (part of the year).
All the dividends of the earlier years, which have remained unclaimed, have since been transferred to the Investor Education and Protection Fund at the expiry of the specified period(s) as required under Companies Act. Details of dividends remaining unclaimed as on 31.03.2018 are as under :
Year |
Date of declaration |
No. of Shareholders |
Total Unclaimed Dividend (Rs.) |
Due date for transfer to IEPF Account |
2010 - 2011 |
29.09.2011 |
729 |
60,868.80 |
05.11.2018 |
2011 - 2012 to 2016 - 2017 |
No Dividend declared |
N.A. |
CORPORATE GOVERNANCE AND MANAGEMENTâS DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Managementâs Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexures, together with the Certificate from the Auditor of the Company regarding compliance with the requirements of Corporate Governance as stipulated under various regulations of the SEBI (Listing Obligations and disclosure requirements) Regulations, 2015.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued support and co-operation from your Companyâs customers, vendors, bankers and all other stakeholders. Your Company will continue to build and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels. The Directors also place on record their gratitude to the Members for their continued support and confidence.
For and on behalf of the Board of Directors
BO JINGEN N.K. RAMASWAMY
Managing Director Director
Place : Chennai
Date : 28th May, 2018
Mar 31, 2017
The Directors hereby present their 33rd Annual Report along with Audited Financial Statements for the year ended March 31, 2017.
FINANCIAL RESULTS (Rs. in Lacs)
Particulars |
Year Ended March 31, 2017 |
Year Ended March 31, 2016 |
||
Revenue from Operations |
||||
Gross |
48,322.45 |
35,599.51 |
||
Net of Excise Duty |
42,712.63 |
31,416.81 |
||
Other Income |
38.40 |
89.34 |
||
Profit before Finance Costs & |
||||
Depreciation and amortisation expense |
1,903.94 |
2,753.29 |
||
Finance Costs |
(105.05) |
720.98 |
||
Profit before Depreciation and |
||||
amortisation expense |
2,008.99 |
2,032.31 |
||
Depreciation and amortisation expense |
305.42 |
293.93 |
||
Profit before Tax |
1,703.57 |
1,738.38 |
||
Tax expenses - Current Tax |
382.00 |
201.11 |
||
- Deferred Tax |
138.09 |
520.09 |
457.32 |
658.43 |
Profit after Tax Balance brought forward Surplus / (Deficit) carried forward |
1,183.48 (490.58) 692.90 |
1,079.95 (1,570.53) (490.58) |
BUSINESS OPERATIONS
Your Company reported a top-line growth of 35.74% over the Previous Year. The Gross Revenue from operations stood at Rs.48,322.45 lacs compared with Rs.35,599.51 lacs in the Previous Year. The Operating Profit before tax stood at Rs.1,703.57 lacs as against Rs.1,738.38 lacs in the Previous Year. The Net Profit for the year stood at Rs.1,183.48 lacs against Rs.1,079.95 lacs reported in the Previous Year.
The company continues to retain and reinforce its market leadership in modified thermoplastics with a pan India network of operations having plants and warehouses situated in auto hubs and industrial belts.
There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of this Report.
Detailed analysis of the Companyâs performance during the year is provided in Annexure to this report under Managementâs Discussion and Analysis Report.
DIVIDEND
Though the operations for the year have generated a profit, in view of the carryover loss of the earlier years in the Profit and Loss account, your Directors regret that they are unable to recommend any dividend on the Equity Share Capital for the year under review.
RESERVES
As on March 31, 2017 the reserves and surplus stood at Rs.12,115.16 Lacs as compared to Rs.10,931.68 Lacs as on March 31, 2016.
RIGHTS ISSUE OF EQUITY SHARES
The Company in order to augment resources for its long term funds requirement of the Company has gone for Rights Issue of Equity Shares to finance the ongoing project of Setting up of a new facility at Chakan, Pune, Upgradation of R & D facility at the existing set-up at Puducherry, Expansion of facility at the existing set-up at Puducherry and Manesar and to meet the additional working capital requirement.
The Rights Issue got opened on March 27, 2017 and closed on April 10, 2017. The Company had issued 19,99,893 equity shares of face value Rs.10/- each for cash at issue price of Rs.750/- per equity share including share premium of Rs.740/- per equity share in the ratio of 18 equity shares for every 91 equity shares held aggregating to Rs.14999.20 Lacs, to the existing Shareholders of the Company.
SHARE CAPITAL
Consequent to the Rights Issue of Equity Shares, the paid up equity capital of the Company stood at Rs.1211.05 lacs. The Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.
LISTING OF COMPANYâS EQUITY SHARES ON NATIONAL STOCKEXCHANGE
Company Issued Equity Shares are admitted to dealing on the National Stock Exchange of India Limited (NSE) in the Capital Market Segment with effect from November 15, 2016 consequent to an application made with NSE by the Company. The Symbol of the Company at NSE is âKINGFAâ.
STATUS OF NEW MANUFACTURING FACILITY
The Company has taken over the possession of the Plot from Maharashtra Industrial Development Corporation and also signed the Lease Agreement of the said land situated at Chakan Industrial Area in Pune for setting up a green field manufacturing location, which will be capable of housing the capacity expansion in the medium term future. The location would also house a State of Art âTechnical and Product Developmentâ Centre to meet the growing needs of the Company.
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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees nor has made any Investments covered under the provisions of Section 186 of the Companies Act, 2013.
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 function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board and to the 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 at all locations of the Company. Based on the report of internal audit function, process owners undertake 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.
CORPORATE SOCIAL RESPONSIBILITY
As a part of its initiative under the âCorporate Social Responsibilityâ (CSR) drive, the Company has undertaken projects which are in accordance with the Companies Act, 2013 and the Companyâs CSR policy. The Report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure - I and forms an integral part of this Report.
ENVIRONMENT, HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS 18001 certification.
Your Companyâs policy require the conduct of all operations in such a manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.
As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at the workplace with a mechanism of lodging complaints. The Company has not received any compliant under this policy during the year under review.
INDUSTRIAL RELATIONS
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR policies to the growing requirements of the business. Reviews, training and tools are being provided for the personnel to improve overall efficiency.
DIRECTORS
A. Changes in Directors and Key Managerial Personnel
Ms. Kamana Srikanth has resigned as Director from the Board with effect from 24th October, 2016 due to her other occupations. The Board wishes to place on record its appreciation of the valuable service rendered by her during her tenure in the Company.
The Board appointed Ms. Nilima Ramrao Shinde as an Additional Director (Non-Executive, Independent Woman Director) of the Company with effect from 1st November, 2016 subject to the approval by the Shareholders at the ensuring Annual General Meeting.
Your Director, Mr.Wu Xiaohui retire by rotation and being eligible, offers himself for re-appointment.
Your Directors have re-appointed Mr.Bo Jingen as Managing Director and Mr.Wu Xiaohui as Whole-time Director of the Company for a further period of Three years with effect from 27th February, 2017 at their Meeting held on 13th February, 2017. The necessary resolutions are being placed before the shareholders for their approval.
Mr.Nirnoy Sur was appointed as Company Secretary and Compliance Officer of the Company with effect from 24th October, 2016 in the place of Mr.S.K.Subramanyan who has since superannuated.
B. Declaration by an Independent Director(s)
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 read with SEBI (LODR) Regulations, 2015.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
All new Independent Directors inducted into the Board are familiarized with the Organisation. The details of such program are provided in Corporate Governance Report.
NUMBER OF MEETINGS OF THE BOARD
The details of the number of Meetings of the Board held during the Financial Year 2016 - 17 forms part of the Corporate Governance Report.
COMMITTEES OF THE BOARD
The details of the various Committees of the Board i.e. Audit Committee, Nomination and Remuneration Committee, Stakeholder Relationship Committee, Corporate Social Responsibility Committee and Rights Issue Committee held during the Financial Year 2016 - 17 are provided in the Corporate Governance Report.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015 the Board has carried out performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees as required. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
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 and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance 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.
DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c ) of the Companies Act, 2013:
(i) that in the preparation of the Annual Accounts for the year ended 31st March, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(ii) the directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit and loss of the Company for the year ended on that date;
(iii) that the directors has taken proper and sufficient care 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;
(iv) the annual accounts have been prepared on a âgoing concernâ basis.
(v) that 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; and
(vi) that the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were on armâs length basis and were in the ordinary course of business. The Policy has been uploaded on the website of the Company. Form AOC-2 is annexed herewith as Annexure - II and forms an integral part of this report.
SUBSIDIARY COMPANIES
The Company does not have subsidiary.
WHISTLE BLOWER POLICY AND VIGIL MECHANISM
In pursuant to the provisions of the Companies Act, 2013, a Whistle Blower Policy and Vigil Mechanism for Directors and Employees to report genuine concerns has been established. The Policy has been uploaded on the website of the Company.
PREVENTION OF INSIDER TRADING
Pursuant to SEBI (Prohibition of Insider Trading) Regulations, 2015, the Company has formulated and adopted a Code for Prevention of Insider Trading and the same has been uploaded on the website of the Company.
STATUTORY AUDITOR
Pursuant to the provisions of Section 139 of the Companies Act, 2013, and Rules made thereunder the term of office of M/s.P.Srinivasan & Co., as the Statutory Auditors of the Company will conclude from the close of ensuing Annual General Meeting of the Company.
The Board of Directors places on record its appreciation to the services rendered by M/s.P.Srinivasan & Co., as the Statutory Auditors of the Company.
Subject to the approval of the Members, the Board of Directors of the Company has recommended the appointment of M/s. P.G.BHAgWaT, Chartered Accountants, (Firm Registration Number 101118W) as the Statutory Auditors of the Company pursuant to Section 139 of the Companies Act, 2013.
The Company has received confirmation regarding their consent and eligibility under sections 139 and 141 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 for appointment as the auditors of the company.
The Auditors have also confirmed that they hold valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
Accordingly, the Board recommends the resolution in relation to appointment of Statutory Auditors, for the approval by the shareholders of the Company. The necessary resolution is being placed before the shareholders for their approval.
There is no audit qualification for the year under review.
As per the provisions of the Companies Act, 2013, the Auditors Report forms part of Annual Report.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company had appointed M/s.Lakshmmi Subramanian & Associates, Practising Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure - III and forms an integral part of this Report. There is no secretarial audit qualification for the year under review.
COST AUDIT
In compliance with the provisions of Section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of Audit Committee, has appointed Mr.K.Suryanarayanan, Cost Accountant (Registration Number 102347) as Cost Auditor to audit the cost accounts of the Company for the financial year 2017-18. As required under the Companies Act, 2013, a resolution seeking memberâs approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their ratification.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure - IV.
BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within the Company. The Assessment is periodically examined by the Board.
STATUTORY INFORMATION
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 - V to this Report.
The particulars of employees are not applicable since there are no employees drawing remuneration more than Rs.96,00,000/per annum (full year) or Rs.8,00,000/- p.m. (part of the year).
All the dividends of the earlier years, which have remained unclaimed, have since been transferred to the Investor Education and Protection Fund at the expiry of the specified period(s) as required under Companies Act. Details of dividends remaining unclaimed as on 31.03.2017 are as under :
Year |
Date of declaration |
No. of Shareholders |
Total Unclaimed Dividend (Rs.) |
Due date for transfer to IEPF Account |
2009 - 2010 |
No Dividend declared |
N.A. |
||
2010 - 2011 |
29.09.2011 |
729 |
60,868.80 |
05.11.2018 |
2011 - 2012 to 2015 - 2016 |
No Dividend declared |
N.A. |
CORPORATE GOVERNANCE AND MANAGEMENTâS DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Managementâs 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 under various regulations of the SEBI (Listing Obligations and disclosure requirements) Regulations, 2015.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued support and co-operation from your Companyâs customers, vendors, bankers and all other stakeholders. Your Company will continue to build and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels. The Directors also place on record their gratitude to the Members for their continued support and confidence.
For and on behalf of the Board of Directors
BO JINGEN N.K. RAMASWAMY
Managing Director Director
Place : Chennai
Date : 31st July, 2017
Mar 31, 2016
The Directors hereby present their32ni Annual Report along with Audited Financial Statements for the year ended March 31, 2016.
FINANCIAL RESULTS
(Rs.in Lacs)
Particulars |
Year Ended March 31,2016 |
Year Ended March 31, 2015 |
||
Revenue from Operations |
||||
Gross |
35,599.51 |
24,680.58 |
||
Net of Excise Duty |
31,416.81 |
21,879.24 |
||
Other Income - |
89.34 |
12.65 |
||
Profit before Finance Costs & |
||||
Depreciation and amortisation expense |
2,753.29 |
658.16 |
||
. Finance Costs |
720.98 |
812.33 |
||
Profit 1 (Loss) before Depreciation and |
||||
amortisation expense |
2,032.31 |
(154.17) |
||
Depreciation and amortisation expense |
293.93 |
314.18 |
||
Profit 1 (Loss) before Tax |
1,738.38 |
(468.35) |
||
Tax expenses - Current Tax |
201.11 |
- |
||
- Deferred Tax |
457.32 |
658.43 |
(164.14) |
(164.14) |
Profit 1 (Loss) after Tax |
1,079.95 |
(304.21) |
||
Balance brought forward |
(1,570.53) |
(1,247.75) |
||
Depreciation adjustment as per |
||||
Companies Act, 2013 .. |
; - |
(18.57) |
||
Deficit carried forward |
(490.58) |
(1,570.53) |
BUSINESS OPERATIONS
Operating Revenues grew by 43% over the previous year, whilst the volumes growth of 50% was achieved. Sales of Engineering plastics compounds produced was effected for the , first full year.
The benign commodity prices during the year helped in keeping a check on the raw material input prices.
The Agency agreement with M/s.TOSAF Compounds Ltd., Israel for the distribution of Master batches compounds was mutually terminated at the end of the first quarter of the fiscal year,.
Detailed analysis of the Company''s performance during the year is provided in Annexure to this report under Managementâs Discussion and Analysis Report.
DIVIDEND
Though the operations for the year have generated a profit, in view of the carryover loss of the earlier years in the Profit and Loss account, your Directors regret that they are unable to recommend any dividend on the Equity Share Capital for the year under review.
RIGHTS ISSUE OF EQUITY SHARES
During the year, the Company had issued 37, 03,364 equity shares of face value Rs. 10/- each for cash at issue price of Rs. 270/- per equity share including share premium of Rs. 260/- per equity share in the ratio of 578 equity shares for every 1000 equity shares held aggregating to Rs. 9999.08 Lacs, to the existing Shareholders of the Company.
The Company sought and obtained approval from its Members to vary I enlarge the terms of offer made for rights issue relating only to the Object of the issue and Utilisation of proceeds.
The amount received under the Rights Issue have been utilised for the above revised purposes.
SHARE CAPITAL
Consequent to the Rights Issue of Equity Shares, the paid up equity capital as on March 31, 2016 stood at Rs. 1,011.06 lacs. The Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.
BIFR
The company made a reference to BIFR consequent to erosion of more than fifty percent of its peak net worth in 2014. Post completion of the Right Issue of Rs. 9999.08 Lacs by the Company in October 2015 and the improved financial results achieved, the company has recouped the above losses and the same has been informed to BIFR on 26th February, 2016.
NAME CHANGE OFTHE COMPANY
The Company changed its name from Hydro S & S Industries Limited to Kingfa Science & Technology (India) Limited. The Company obtained fresh Certificate of Incorporation from Registrar of Companies, Chennai for the change of name of the company; it also received consent from BSE Limited pursuant to Change in Name of the Company and change in Scrip ID as KINGFA. The depositories, NSDL and CDSL have also changed the name of the Scrip to Kingfa Science & Technology (India) Limited. The process of name change with the statutory authorities is on and will be completed shortly.
FINANCE
The Company received Rs. 47.41 lacs as subsidy under the Industrial Promotion Scheme of the Government of Maharashtra for its investment in Jejuri during the year, and the same is credited in the Books under Capital Reserve.
NEW MANUFACTURING FACILITY
The Company is in the process of setting up a green field manufacturing location near Pune, which will be capable of housing the capacity expansion in the medium term future. The location would also house a State of Art âTechnical and Product Development Centre" to meet the growing needs of the Company. ,
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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees nor has made any Investments covered under the provisions of Section 186oftheCompaniesAct, 2013.
INTERNAL CONTROL SYSTEMS ANDTHEIR 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 function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board and to the Chairman and 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 at all locations of the Company. Based on the report of internal audit function, process owners undertake 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.
CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted a Corporate Social Responsibility Committee and framed its Policy. The Policy has been uploaded on the website of the Company.
ENVIRONMENT, HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS18001 certification.
Your Companyâs policy require the conduct of all operations in such a manner so as to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.
INDUSTRIAL RELATIONS
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR policies to the growing requirements of the business. Reviews, training and tools are being provided for the personnel to improve overall efficiency.
DIRECTORS -
Mr.Dilip Dinkar Kulkarni was appointed as an Independent Director by the Members at the Annual General Meeting held on 28th September, 2015.
Mr.N.K.Ramaswamy was appointed as a Whole-time Director, designated as Chief Executive Officer with effect from 13th November, 2015 and approved by the Members through Postal Ballot whose results were declared on 1st February, 2016.
Mr.Nie Delin has resigned as Director from the Board with effect from 13th November, 2015 due to his other occupations. The Board wishes to place on record its appreciation of the valuable service rendered by him during his tenure in the Company.
Your Director, Mr. Jingen retires by rotation and being eligible, offers himself for re-appointment. Both Mr. Bo Jingen, Managing Director and Mr.Wu Xiaohui, Whole-time Director being non-residents, an application was made for their appointment to the Central Government and approval was received.
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 under Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
NUMBER OF MEETINGS OF THE BOARD
The details of the number of Meetings of the Board held during the Financial Year 2015-16 forms part of the Corporate Governance Report.
COMMITTEES OF THE BOARD
During the year, the various Committees of the Board i.e. Audit Committee, Nomination and Remuneration Committee and Stakeholder Relationship Committee were reconstituted and Corporate Social Responsibility Committee was constituted. The details of terms of reference of these committees have been given in the Corporate Governance Report.
DIRECTORSâRESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013:
(i) that in the preparation of the Annual Accounts for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
(ii) 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 as at March 31,2016 and of the profit or loss of the Company for the year ended on that date;
(iii) that the Directors has taken proper and sufficient care 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;
(iv) the annual accounts have been prepared on a "going, concernâ basis.
(v) that 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; and
(vi) that the Directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.
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 business. The Policy has been uploaded on the website of the Company.
SUBSIDIARY COMPANIES
The Company does not have subsidiary.
WHISTLE BLOWER POLICY AND VIGIL MECHANISM
in pursuant to the provisions of the Companies Act, 2013, a Whistle Blower Policy and Vigil Mechanism for Directors and Employees to report genuine concerns has been established. The Policy has been uploaded on the website of the Company.
PREVENTION OF INS1DERTRADING
In January 2015, SEBI notified the SEBl (Prohibition of Insider Trading) Regulations, 2015 which came into effect from May 15,2015. Pursuant thereto, the Company has formulated and adopted a new Code for Prevention of Insider Trading and the same has been uploaded on the website of the Company.
AUDITORS
M/s. P. Srinivasan and Co., Chartered Accountants, Chennai, Statutory Auditors, retires at the close of this Annual General Meeting and are eligible for reappointment. The Company has received confirmation regarding their consent and eligibility under sections 139 and 141 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 for appointment as the auditors of the company.
The Auditors have also confirmed that they hold valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
The Audit Committee and the Board of Directors have recommended the appointment of the Auditors for the financial
yea r 2016 -17. The necessary resolution is being placed before the shareholders for their approval.
SECRETARlAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company had appointed M/slakshmmi Subramanian & Associates, Practising Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as ANNEXURE -1 and forms an integral part of this Report. The observations made in the report are self explanatory.
COST AUDIT
In compliance with the provisions of Section 148 of the Companies Act, 2013, the Board of Directors of the Company had appointed Mr.K.Suryanarayanan, Cost Accountant as Cost Auditor of the company to conduct audit of cost records made and maintained by thecompany.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annua! Return in Form MGT-9 is annexed herewith as ANNEXURE - II.
BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within the Company. The Assessment is periodically examined by the Board.
STATUTORY INFORMATION
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- III to this Report.
The particulars of employees are not applicable since there are no employees drawing remuneration more than Rs. 60,00,000/per annum (full year)or 5,00,000/-p.m. (part of the year).
All the dividends of the earlier years, which have remained unclaimed, have since been transferred to the Investor Education and Protection Fund at the expiry of the specified period(s) as required under Companies Act, Details of dividends remaining unclaimed as on 31.03.2016 are as under:
Year |
Date of declaration |
No. of Shareholders |
Total Unclaimed Dividend (Rs.) |
Due date for transfer to 1EPF Account |
2008-2009 to 2009 - 2010 |
No Dividend declared |
N.A. |
||
2010-2011 |
29.09.2011 |
729 |
60,868.80 |
05.11.2018 |
2011 -2012 to 2014-2015 |
No Dividend declared |
N.A. |
CORPORATE GOVERNANCE AND MANAGEMENTâS DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Managementâs Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexure, together with the Certificate from the Auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated under various regulations of the SEBI (Listing Obligations and disclosure requirements) Regulations, 2015.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued support and co-operation from your Companyâs customers, vendors, bankers and all other stakeholders. Your Company will continue to build and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism, commitment and dedication displayed by employees at all levels. The Directors also place on record their gratitude to the Members for their continued support and confidence.
For and on behalf of the Board of Directors
BOJINGEN
Chairman and Managing Director
Place: Chennai
Date: 30th May, 2016
Mar 31, 2015
The Directors hereby present their 31st Annual Report along with
Audited Financial Statements for the year ended March 31, 2015.
FINANCIAL RESULTS (Rs. in Lacs)
Year Ended Year Ended
Particulars March 31, 2015 March 31, 2014
Revenue from Operations
Gross 24,680.58 19,933.00
Net of Excise Duty 21,879.24 17,782.55
Other Income 12.65 23.26
(Loss) / Profit before
Finance Costs &
Depreciation and
amortisation expense 658.16 (306.51)
Finance Costs 812.33 656.36
Loss before Depreciation
and amortisation expense (154.17) (962.87)
Depreciation and
amortisation expense 314.18 265.73
Loss before Tax (468.35) (1,228.60)
Tax expenses - Current Tax - -
- Deferred Tax (164.14) (380.88)
(164.14) (380.88)
Loss after Tax (304.21) (847.72)
Balance brought forward (1,247.75) (400.03)
Depreciation adjustment as
per Companies Act, 2013 (18.57) -
Deficit carried forward (1,570.53) (1,247.75)
BUSINESS OPERATIONS
Sales Revenue grew by 23% over the previous year, with volume growth of
15% achieved. Engineering Plastic Compounds sourced from HQ Kingfa,
achieved its full year of sales, whilst the sale of EP compounds
produced by the Company clocked revenue for last quarter of the year.
The benefit of drop of Polypropylene prices during the last quarter did
not last long, as the prices started rising sharply towards the end of
the last quarter.
Detailed analysis of the Company's performance during the year is
provided in Annexure to this report under Management's Discussion and
Analysis Report.
DIVIDEND
The operations of the Company have resulted in a loss as explained in
detail in the Management's Discussion and Analysis Report. Hence, your
Directors regret that they are unable to recommend any dividend on the
Equity Share Capital of the Company for the year under review.
SHARE CAPITAL
The paid up equity capital as on March 31, 2015 was Rs. 640.72 lacs.
The Company has not issued shares with differential voting rights nor
granted stock options nor sweat equity.
OFFER FOR SALE BY PROMOTER
The Promoter, Kingfa Sci. & Tech. Co., Ltd., China in order to comply
with the minimum public shareholding requirements of the listing
agreement with Stock Exchanges had gone for Offer for Sale (OFS) of
5,00,000 Equity Shares on 16.12.2014 and had offloaded 2,58,930 Equity
Shares (4.04%). A second Offer for Sale of 2,41,070 (3.76%) Equity
Shares on 15.01.2015 was done and achieved successfully.
With the above two OFS's done, the promoter shareholding is now in
compliance with the minimum public shareholding requirements of the
listing agreement.
RIGHTS ISSUE OF EQUITY SHARES
The Company in order to augment resources for its long term funds
requirement of the Company has proposed to go for Rights Issue of
Equity Shares and intends to deploy the Issue Proceeds for Repayment of
short term loans availed by the Company and Setting up of additional
facilities at the existing locations. In this regard, the Company has
filed draft letter of offer with SEBI and BSE Limited and awaiting its
comments.
FINANCE
The Company's claim with the Government of Maharashtra for the
Industrial Promotion Subsidy for its investment in Jejuri was approved
during the year. The Company has received the refund of Electricity
duty and is awaiting receipt of the VAT subsidy.
BIFR
Upon obtaining approval from the Shareholders at the Annual General
Meeting held on 25th July, 2014, the Company had intimated Board for
Industrial and Financial Reconstruction (BIFR) of the fact of erosion
of more than 50% of the peak Net Worth. Subsequent status report of
the steps undertaken have also been intimated.
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.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees nor has made any
Investments covered under the provisions of Section 186 of the
Companies Act, 2013.
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 function is defined in the Internal Audit Manual. To
maintain its objectivity and independence, the Internal Audit function
reports to the Chairman of the Audit Committee of the Board & to the
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 at all locations of the Company. Based on the report of
internal audit function, process owners undertake 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.
CORPORATE SOCIAL RESPONSIBILITY
The Company does not meet the criteria prescribed under Section 135 of
the Companies Act 2013, hence the same is not applicable for the year
under review.
ENVIRONMENT, HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS 18001
certification.
Your Company's policy require the conduct of all operations in such a
manner so as to ensure safety of all concerned, compliance of statutory
and industrial requirements for environment protection and conservation
of natural resources to the extent possible.
INDUSTRIAL RELATIONS
Industrial relations remained cordial during the year.
Various HR initiatives are continuously taken to align the HR policies
to the growing requirements of the business. Reviews, training and
tools are being provided for the personnel to improve overall
efficiency.
DIRECTORS
Your Director, Mr.Wu Xiaohui retire by rotation and being eligible,
offers himself for re-appointment.
The Board appointed Ms. Kamana Srikanth as an Additional Director - Non
Executive Independent Director of the Company with effect from 13th
February, 2015 for a period of 5 years subject to approval by the
Shareholders at the ensuing Annual General Meeting.
Your Directors have re-appointed Mr.Bo Jingen as Managing Director and
Mr.Wu Xiaohui as Whole-time Director of the Company at their Meeting
held on 31st October, 2014.
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.
NUMBER OF MEETINGS OF THE BAORD
The details of the number of Meetings of the Board held during the
Financial Year 2014 - 15 forms part of the Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of knowledge and belief and according to the information
and explanations obtained by them, your Directors make the following
statement in terms of Section 134(3)(c) of the Companies Act, 2013:
(i) that in the preparation of the Annual Accounts for the year ended
31st March, 2015, the applicable accounting standards have been
followed along with proper explanation relating to material departures,
if any;
(ii) and applied them consistently and made judgements and estimates
that are reasonable and prudent so as to give a true and fair view of
the state of affairs of the Company as at March 31, 2015 and of the
profit or loss of the Company for the year ended on that date;
(iii) that the Directors has taken proper and sufficient care 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;
(iv) the annual accounts have been prepared on a "going concern" basis.
(v) that 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; and
(vi) that the Directors had devised proper system to ensure compliance
with the provisions of all applicable laws and that such system were
adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All transactions entered into with the Related Parties as defined under
the Companies Act, 2013 and Clause 49 of the Listing Agreement during
the financial year were in the ordinary course of business and on arm's
length basis.
SUBSIDIARY COMPANIES
The Company does not have subsidiary.
AUDITORS
M/s. P. Srinivasan and Co., Chartered Accountants, Chennai, Statutory
Auditors, retire at the close of this Annual General Meeting and are
eligible for reappointment. The Company has received confirmation
regarding their consent and eligibility under sections 139 and 141 of
the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 for
appointment as the auditors of the company.
As required under Clause 41 of the Listing Agreement, the Auditors have
also confirmed that they hold valid certificate issued by the Peer
Review Board of the Institute of Chartered Accountants of India.
The Audit Committee and the Board of Directors have recommended the
appointment of the Auditors for the financial year 2015 - 16. The
necessary resolution is being placed before the shareholders for their
approval.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and rules made thereunder, the Company had appointed M/s.Lakshmmi
Subramanian & Associates, Practising Company Secretaries to undertake
the Secretarial Audit of the Company. The Secretarial Audit Report is
included as ANNEXURE - I and forms an integral part of this Report.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form
MGT-9 is annexed herewith as ANNEXURE - II.
BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within
the Company. The Assessment is periodically examined by the Board.
STATUTORY INFORMATION
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 - III to this Report.
The particulars of employees are not applicable since there is no
employee drawing remuneration more than Rs. 60,00,000/- per annum (full
year) or Rs. 5,00,000/- p.m (part of the year).
All the dividends of the earlier years, which have remained unclaimed,
have since been transferred to the Investor Education and Protection
Fund at the expiry of the specified period(s) as required under
Companies Act. Details of dividends remaining unclaimed as on
31.03.2015 are as under :
Year Date of No. of Total
Unclaimed Due date
for
transfer
declaration Share
holders Dividend
(Rs.) to IEPF
Account
2007 - 2008
(Final) 16.09.2008 563 54,161.50 22.10.2015
2008 - 2009 No Dividend declared N.A.
2009 - 2010 No Dividend declared N.A.
2010 - 2011 29.09.2011 730 60,928.80 05.11.2018
2011 - 2012 No Dividend declared N.A.
2012 - 2013 No Dividend declared N.A.
2013 - 2014 No Dividend declared N.A.
CORPORATE GOVERNANCE AND MANAGEMENT'S DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Management's 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 Clause 49 of the Listing Agreement.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued
support and co-operation from your Company's customers, vendors,
bankers and all other stakeholders. Your Company will continue to build
and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also place on record their gratitude to the Members for their
continued support and confidence.
For and on behalf of the Board of Directors
Place : Chennai N. SUBRAMANIAN BO JINGEN
Date : 28th May, 2015 Chairman of the Meeting Managing Director
Mar 31, 2013
The Directors hereby present their 29th Annual Report alongwith
Audited Statement of Accounts of the Company for the year ended March
31'' 2013.
FINANCIAL RESULTS
(Rs.in Lacs)
Year Ended Year Ended
Particulars March 31'' 2013 March 31'' 2012
Revenue from Operations
Gross 17''634.38 16''539.48
Net of Excise Duty 15''657.95 15''010.03
Other Income 83.63 14.36
Profit before Finance Costs &
Depreciation and amortisation
expense 268.64 910.04
Finance Costs 697.12 655.61
(Loss) / Profit before
Depreciation and
amortisation expense (428.48) 254.43
Depreciation and amortisation expense 281.85 267.94
(Loss) / Profit before Tax (710.33) (13.51)
Tax expenses - Current Tax
- Deferred Tax (205.50) (16.00)
(205.50) (16.00)
(Loss) / Profit after Tax (504.83) 2.49
Balance brought forward 104.80 102.32
(Loss) / Profit available
for Appropriation (400.03) 104.80
Appropriations:
Transfers to General Reserve
Special General Reserve
Proposed Dividend
On Equity Shares
Tax on distributable profits
(Deficit) / Surplus carried forward (400.03) 104.80
(400.03) 104.80
BUSINESS OPERATIONS
Revenue from Operations grew moderately by 4% over the previous year''
though volumes remain flat. The year witnessed continued turbulence on
the business front with inflation continuing to rule high'' leading to
high interest rates and dampened consumer enthusiasm to buy
automobiles.
Your Company had to continue facing the challenges of a sustained high
inflation on input prices. The high input costs'' in the context of
resistance from customers to adequate compensation'' led to erosion in
margins.
As indicated in the last year''s report'' your company has completed the
compounding facility at Manesar to cater to the requirements of the
Northern market'' with an initial capacity of 6000 MTPA. This facility
was commissioned in March 2013 and is expected to contribute to growth
of the company during the current year.
The Pultrusion division has been only achieving marginal performance
during the recent years and hence it was decided to close down
operations of this division.
As part of realignment of capacity'' it was decided to curtail
production at Pudukkottai. Consequently it was decided to sell the two
Wind Mills which the Company had established. The proceeds from the
sale were utilised for funding the Manesar facility and into
operations.
Detailed analysis of the Company''s performance during the year is
provided in Annexure - F to this Report.
DIVIDEND
Due to the adverse business environment'' the operations of the Company
have resulted in a net loss as explained in detail in the Management''s
Discussion and Analysis Report. In order to conserve resources'' your
Directors regret that they are unable to recommend any dividend on the
Equity Share Capital of the Company for the year under review.
ENVIRONMENT'' HEALTH AND SAFETY
The facilities of the Company renewed their ISO 14001 and OHSAS 18001
certification.
Your Company''s policy require the conduct of all operations in such a
manner so as to ensure safety of all concerned'' compliance of statutory
and industrial requirements for environment protection and conservation
of natural resources to the extent possible.
EMPLOYEE RELATIONS
Industrial relations remained cordial during the year. A new three year
wage pact'' upon expiry of the earlier agreement was signed with the
workmen of the Puducherry plant.
Various HR initiatives are continuously taken to align the HR policies
to the growing requirements of the business. Technical and Safety
training programmes are given periodically to workers.
PART II - CORPORATE MATTERS
CORPORATE GOVERNANCE
Your Company continues to be committed to governance aligned with good
management practices.
As per the requirement of Clause 49 of the Listing Agreement entered
into with the Stock Exchanges'' a detailed report on Corporate
Governance is set out in Annexure - B to this Report.
The Statutory Auditors of the Company have examined the Company''s
compliance and have certified the same'' as required under SEBI
Guidelines. Such certificate is reproduced in Annexure - C to this
Report.
The Whole Time Director and CFO certification is given in Annexure - D
to this Report.
A Statement of General Business Principles is given in Annexure - E to
this Report.
A separate Management''s Discussion and Analysis Report on the Company''s
performance is given in Annexure - F to this Report.
A Declaration by Mr.S.K.Subramanyan (Whole-time Director) with regard
to compliance of Company''s Code of Conduct by the Board Members and
Senior Management Personnel is furnished as Annexure - G to this
Report.
The Directors'' Responsibility Statement as required under Section
217(2AA) of the Companies Act'' 1956 is furnished in Annexure - H to
this Report.
CHANGE IN MANAGEMENT CONTROL
The Promoters of the Company have informed the Board that they have
entered into a Share Purchase Agreement with M/s. Kingfa Sci. & Tech.
Co.'' Ltd.'' Guangzhou'' China'' for transfer of their shareholding in the
Company.
This process will be completed after necessary approvals are obtained.
The Board of Directors have considered this communication and taken
note of the development.
The Board feels that it will be in the best interests of the Company''
its Shareholders and the Employees if a strategic global player from
the Industry is inducted into the Company.
DIRECTORS
Mr.Narayan Sethuramon'' Director resigned from the Board with effect
from 23rd July'' 2012. The Board wishes to place on record its
appreciation of the valuable services rendered by him during his tenure
in office both in the Executive and Non Executive roles.
Your Directors'' MrÂ
Â
and MrÂ
Â
retire by rotation at the forthcoming
Annual General Meeting of the Company and being eligible'' offer
themselves for re-appointment. - To be finalised (Refer Addendum to
Directors'' Report in Page No.7).
The necessary resolutions in this regard are being placed before the
Shareholders for their approval.
AUDITORS
The Auditors of the Company'' M/s. P. Srinivasan and Co.'' Chartered
Accountants'' Chennai hold office until the conclusion of the Annual
General Meeting and have given their consent for re-appointment. The
Company has received confirmation that their appointment will be within
the limits prescribed under Section 224 (1B) of the Companies Act''
1956. The necessary resolution is being placed before the shareholders
for their approval.
COST AUDITOR
Your Company has come under the purview of The Companies (Cost Audit
Report) Rules'' 2011 and is required to conduct an audit of the cost
records'' by a Cost Accountant. In requirement of this'' the Company has
appointed P. Raju Iyer'' M.Pandurangan & Associates'' Cost Accountants''
Chennai as the Cost Auditors for the audit of Cost records for the year
ended 31st March 2013.
The Company has duly filed the Cost Compliance Report for the year
ended 31st March 2012.
STATUTORY INFORMATION
The provisions of Section 217(2A) of the Companies Act'' 1956'' read with
the Companies (Particulars of Employees) Rules'' 1975'' as amended'' are
not applicable since there is no employee drawing remuneration more
than Rs. 60''00''000/- per annum (full year) or Rs. 5''00''000/- p.m (part of
the year).
Particulars required under Section 217(1)(e) of the said Act relating
to Energy Conservation'' Technology Absorption and Foreign Exchange
Earnings and Outgo are furnished in a separate statement annexed to and
forming part of this Report as
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public within
the meaning of Section 58A of the Companies Act'' 1956.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued
support and co-operation from your Company''s customers'' vendors''
bankers and all other stakeholders. Your Company will continue to build
and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism''
commitment and dedication displayed by employees at all levels. The
Directors also place on record their gratitude to the Members for their
continued support and confidence.
For and on behalf of the
Board of Directors
Place : Chennai V. SRINIVASAN MURALI
VENKATRAMAN
Date : 21st May'' 2013 Chairman of the
Meeting Vice - Chairman
Mar 31, 2012
The Directors hereby present their 28th Annual Report along with
Audited Statement of Accounts of the Company for the year ended March
31, 2012.
FINANCIAL RESULTS
(Rs. in Lacs)
Year Ended Year Ended
Particulars March 31, 2012 March 31, 2011
Revenue from Operations
Gross 16,539.48 15,468.06
Net of Excise Duty 15,010.03 14,011.62
Other Income 14.36 12.14
Profit before Finance Costs &
Depreciation and amortization expense 910.04 864.98
Finance Costs 655.61 465.09
Profit before Depreciation and
amortization expense 254.43 399.89
Depreciation and amortization expense 267.94 269.09
Profit / (Loss) before Tax (13.51) 130.80
Taxation- Current Tax - 32.00
- Deferred Tax (16.00) (6.00)
(16.00) --26.00
Profit after Tax 2.49 104.80
Balance brought forward 102.32 144.84
Profit available for
Appropriation 104.80 249.64
Appropriations:
Transfers to
General Reserve - 100.00
Special General Reserve - 2.50
Proposed Dividend
On Equity Shares - 38.44
Tax on distributable profits - 6.38
- 147.32
Surplus carried forward 104.80 102.32
104.80 249.64
BUSINESS OPERATIONS
Revenue from operations recorded an increase of 7% over the previous
year, though volumes remained flat. The year witnessed a turbulent
business environment that moderated growth. The year started with
optimism but as it progressed there were challenges with inflation,
decelerating growth and worsening investment climate which adversely
impacted consumer sentiments. The global economic environment was
confronted with geo-political instability, Euro zone crisis, fluctuating
global commodity prices etc.
Your Company had to deal with the challenges of a sharp depreciation of
the Indian Rupee during the year coupled with a sharp increase in the
prices of polypropylene during the last quarter. This has to be viewed
in the context of extreme resistance from Customers to price revisions.
The financial statements have been prepared in compliance with the
revised Schedule VI guidelines, notified by the Ministry of Corporate
Affairs. Therefore, the previous year's figure have been regrouped /
recast wherever necessary.
The Pultrusion Division continues to face the challenges of declining
prices during the year due to surplus capacity pressures which resulted
in a lower performance as compared to the previous year.
Detailed analysis of the Company's performance during the year is
provided in Annexure - E to this Report.
DIVIDEND
During the year under review, the operations of the Company were
impacted for various reasons as explained under the head 'Business
Operations'. In view of the adverse financial results and to conserve
resources for future growth, your Directors have not recommended any
dividend on the Equity Shares for the year under review.
EXPANSION PLANS
Your Company had embarked on a aggressive market development strategy
to increase the share of its business in the automotive segment and we
hope to see the benefit of these initiatives in the current year.
With this market dynamics, a capacity balancing needs to be implemented
in order to serve the existing customers and new entrants in a much
more efficient manner. Hence, your Company had decided to put up a new
facility at Manesar in the State of Haryana. This facility will have an
initial capacity of 3000 TPA.
ENVIRONMENT, HEALTH AND SAFETY
Your Company is conscious of the importance of environmentally clean
and safe operations. Your Company's policy require the conduct of all
operations in such a manner so as to ensure safety of all concerned,
compliance of statutory and industrial requirements for environment
protection and conservation of natural resources to the extent
possible.
EMPLOYEE RELATIONS
Various HR initiatives are continuously taken to align the HR policies
to the growing requirements of the business. Your Company has a
structured induction process at all locations and Management
Development Programmes to upgrade skills of Managers. Technical and
Safety training programmes are given periodically to workers.
Industrial relations remained generally cordial.
PART II - CORPORATE MATTERS CORPORATE GOVERNANCE
Your Company continues to be committed to Governance aligned with good
management practices.
As per the requirement of Clause 49 of the Listing Agreement entered
into with the Stock Exchanges, a detailed report on Corporate
Governance is set out in Annexure - B to this Report.
The Statutory Auditors of the Company have examined the Company's
compliance and have certified the same, as required under SEBI
Guidelines. Such certificate is reproduced in Annexure - C to this
Report.
The Whole Time Director and CFO certification is given in Annexure - D
to this Report.
A separate Management Discussion and Analysis Report on the Company's
performance is given in Annexure - E to this Report.
A Declaration by Mr.S.K.Subramanyan (Whole-time Director) with regard
to compliance of Company's Code of Conduct by the Board Members and
Senior Management Personnel is furnished as Annexure - F to this
Report.
The Directors' Responsibility Statement as required under Section
217(2AA) of the Companies Act, 1956 is furnished in Annexure - G to
this Report.
DIRECTORS
Your Directors, Mr.Dinshaw K Parakh and Mr.Narayan Sethuramon retire by
rotation at the forthcoming Annual General Meeting of the Company and
being eligible, offer themselves for re-appointment.
The term of Office of Mr.S.K.Subramanyan as Whole Time Director
[Director (Finance & Administration) & Company Secretary] expires on
30th September 2012. The Board has recommended his re-appointment for a
further period of three years.
The necessary resolutions in this regard are being placed before the
Shareholders for their approval.
AUDITORS
The Auditors of the Company, M/s. P. Srinivasan and Co., Chartered
Accountants, Chennai hold office until the conclusion of the Annual
General Meeting and have given their consent for re-appointment. The
Company has received confirmation that their appointment will be within
the limits prescribed under Section 224 (1B) of the Companies Act,
1956. The necessary resolution is being placed before the shareholders
for their approval.
STATUTORY INFORMATION
The provisions of Section 217(2A) of the Companies Act, 1956, read with
the Companies (Particulars of Employees) Rules, 1975, as amended, are
not applicable since there is no employee drawing remuneration more
than Rs. 60,00,000/- per annum (full year) or Rs. 5,00,000/-p.m (part of
the year).
Particulars required under Section 217(1)(e) of the said Act relating
to Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo are furnished in a separate statement annexed to and
forming part of this Report as Annexure - A.
All the dividends of the earlier years, which have remained unclaimed,
have since been transferred to the Investor Education and Protection
Fund at the expiry of the specified period(s) as required under Section
205C of the Companies Act, 1956. Details of dividends remaining
unclaimed as on 31.03.2012 are as under :
Year Date of No. of Total Unclaimed Due date for transfer
decla
ration Share
holders Dividend ( Rs.) to IEPF Account
2004 - 2005 28.09.2005 82 74,304.00 08.10.2012
2005 - 2006 18.09.2006 46 32,040.00 28.09.2013
2006 - 2007 13.09.2007 515 1,60,553.00 20.10.2014
2007 - 2008
(Interim) 31.01.2008 568 41,224.00 08.03.2015
2007 - 2008
(Final) 16.09.2008 569 54,305.70 22.10.2015
2008 - 2009 No Dividend
declared N.A.
2009 - 2010 No Dividend
declared N.A.
2010 - 2011 29.09.2011 738 62,827.20 05.11.2018
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public within
the meaning of Section 58A of the Companies Act, 1956.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued
support and co-operation from your Company's customers, vendors,
bankers and all other stakeholders. Your Company will continue to build
and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also place on record their gratitude to the Members for their
continued support and confidence.
For and on behalf of the Board of Directors
Place : Chennai V.THIRUPATHI MURALI VENKATRAMAN
Date :4th June, 2012 Chairman of the
Meeting Vice - Chairman
Mar 31, 2010
The Directors hereby present their 26th Annual Report alongwith
Audited Accounts of the Company for the year ended March 31, 2010.
FINANCIAL RESULTS
(Rs. in 000s)
Year Ended Year Ended
Particulars
March 31, 2010 March 31, 2009
Income from Operations
Gross 1,185,159 1,337,835
Net of Excise Duty 1,092,150 1,183,322
Other Income 3,577 3,572
Profit before Interest &
Depreciation 71,142 42,958
Interest 47,526 48,298
Profit/(Loss) before
Depreciation 23,616 (5,340)
Depreciation 25,768 20,565
Profit/(Loss) before tax (2,152) (25,904)
Taxation - Current Tax - 660
- Deferred Tax (Asset) (2,000) (8,235)
(2,000) (7,575)
Profit/(Loss) after Tax (152) (18,329)
Balance brought forward 15,668 34,149
Profit available for
Appropriation 15,516 15,820
Appropriations:
Transfers to
General Reserve - -
Special General Reserve - -
Capital Redemption Reserve 1,032 152
Dividends
On Equity Shares - -
Tax on distributable profits - -
1,032 152
Surplus carried forward 14,484 15,668
15,516 15,820
BUSINESS OPERATIONS
Your company had to deal with some significant challenges during the
year including sluggish demand in the first half, volatility in the
Polymer prices and receivables pile up leading to liquidity issues. The
total Sales Revenue dipped 10% during the year inspite of a marginal
overall increase in volumes.
Your company took multiple steps to tackle these issues which has
resulted in a considerable improvement in margins even with a stagnant
topline. The new unit at Jejuri (Near Pune) commissioned last year was
operating at almost full capacity on a consistent basis.
The Pultrusion Division expanded its product portfolio with solutions
for new applications and this helped to improve the performance of the
division.
DIVIDEND
In view of the difficult business environment during the first half of
2009 - 2010, the Operations of the Company have resulted in a net loss
as explained in detail in the Management Discussion and Analysis
Report. Further the outlook for the current year is viewed with
cautious optimism and hence your Directors after careful consideration
have decided as a matter of prudence, defer the dividend for the year
under consideration.
RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, ENERGY CONSERVATION
ETC.
Your company has established a dedicated State of the art Application
Development Centre at Puducherry . This centre boasts of some of the
latest Equipments to test sophisticated parameters of plastic parts
used by the compounders and the Automotive OEMs. Your company is
seeking accredition by NABL to this centre.
The centre successfully developed compounds to meet the stringent
specifications of the OEMs, besides developing cost effective
formulations with alternate materials to deal with instability in the
supply chain.
The particulars prescribed by the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 relating to
Conservation of Energy, Technology Absorption, Foreign Exchange are
furnished in Annexure - A to this Report.
PART II - CORPORATE MATTERS
CORPORATE GOVERNANCE
As per the requirement of Clause 49 of the Listing Agreement entered
into with the Stock Exchanges, a detailed report on Corporate
Governance is set out in Annexure - B to this Report.
The Statutory Auditors of the Company have examined the Companys
compliance, and have certified the same, as required under SEBI
Guidelines. Such certificate is reproduced in Annexure - C to this
Report. The Whole Time Director and CFO certification is given in
Annexure - D to this Report. A separate Management Discussion and
Analysis Report on the Companys performance is given in Annexure - E
to this Report.
A Declaration by Mr.S.K.Subramanyan (Whole-time Director) with regard
to compliance of Companys Code of Conduct by the Board Members and
Senior Management Personnel is furnished as Annexure - F to this
Report.
The Directors Responsibility Statement as required under Section
217(2AA) of the Companies Act, 1956 is furnished in Annexure - G to
this Report.
COMPLETION OF BUYBACK OF EQUITY SHARES
The buy-back of equity shares which commenced on 26th February, 2009
has been closed on 15th September, 2009. A total of 1,18,425 equity
shares of Rs.10/- each were bought back from the public Shareholders
under the offer and the said shares were also extinguished. The amount
invested in the buy back is about Rs.4 million.
EMPLOYEE RELATIONS
Relations between the Employees and the Management continued to be
cordial during the year under review.
A fresh Long Term settlement was entered into between the Management
and the Workmen of the Puducherry plant.
Since there are no employees who would come under the purview of
Section 217(2A) of the Companies Act, 1956 read with the Companies
(Particulars of Employees) Rules, 1975, such particulars are not
provided.
DIRECTORS
Yours Directors, Mr.V.Thirupathi, Mr.V.Srinivasan and Mr.Babulal
M.Varma retire by rotation at the forthcoming Annual General Meeting of
the Company and are eligible for re-appointment. However, Mr.Babulal
M.Varma has expressed his intention not to seek re-election.
The necessary resolutions in this regard are being placed before the
Shareholders for their approval.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public within
the meaning of Section 58A of the Companies Act, 1956.
AUDITORS
The Auditors of the Company, M/s. P. Srinivasan and Co., Chartered
Accountants, Chennai hold office until the conclusion of the Annual
General Meeting and have given their consent for re-appointment. The
Company has received confirmation that their appointment will be within
the limits prescribed under Section 224 (1B) of the Companies Act,
1956. The necessary resolution is being placed before the shareholders
for their approval.
ACKNOWLEDGEMENT
Your Directors wish to record their appreciation of the continued
support and co-operation from your Companys customers, vendors,
bankers and all other stakeholders. Your Company will continue to
build and maintain strong links with its business partners.
The Directors sincerely appreciate the high degree of professionalism,
commitment and dedication displayed by employees at all levels. The
Directors also place on record their gratitude to the Members for their
continued support and confidence.
For and on behalf of the Board of Directors
BABULAL M. VARMA MURALI VENKATRAMAN
Chairman of the Meeting
Vice-Chairman
Place : Chennai
Date : 28th July, 2010