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Directors Report of NHC Foods Ltd.

Mar 31, 2015

Dear Members,

The Directors hereby present their 23rd Annual Report on the business and operations of the Company and financial accounts for the year ended 31st March, 2015.

1. FINANCIAL HIGHLIGHTS:

(Rs. In Lacs)

2014-15 2013-14

1. Revenue

(a) Revenue from operation 14279.15 14273.73

(b) Other Income 90.67 92.92

Total 14819.81 14366.65

Profit Before Depreciation & Tax 261.98 318.72

Less: Depreciation & Amortisation Expenses 119.50 100.49

Profit Before Tax 142.48 218.23

Current Tax 29.10 46.00

Less: MAT Receivable 9.81 46.00

Less: Tax adjustment of an earlier year 1.57 Nil

Less: Deferred Tax 3.37 62.77

Profit After Tax 118.25 155.46

2. Operations:

During the year under review, your Company has recorded income of 14819.81 Lacs as against Rs 14366.65 Lacs in the previous year. Due to adverse & volatile market conditions our Company has recorded net profit after tax of Rs. 1.18 Crore, resulting into an Earning Per Share(EPS) of Rs. 1.45 for the financial year.

3. Future Outlook:

In the current year, the business of the Company is likely to improve due to better market condition, technological advancements/improvement in the economy. Moreover, the company is diversifying into other related business areas where business potential is much more.

4. Dividend:

In order to conserve the resources for the future expansion plan of the company under implementation, your directors do not recommend any dividend for the year under the review.

5. Extract of Annual return:

The details forming part of the extract of the Annual Return in form MGT 9 as required under Section 92 of the Companies Act, 2013, is marked as ANNEXURE A which is annexed hereto and forms part of the Directors' Report.

6. Number of Meetings of the Board:

The details of the number of meetings of the Board held during the financial year 2014-15 forms part of the Corporate Governance Report.

7. Directors' Responsibility Statement:

As required by Section 134(3)(c) of the Companies Act, 2013 your Directors state that:

(a) In the preparation of the annual accounts for the year ended 31st March, 2015, the applicable accounting standards have been followed with proper explanation relating to material departures, if any.

(b) The accounting policies adopted in the preparation of the annual accounts have been applied consistently except as otherwise stated in the Notes to financial statements and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year 2014-15 and of the profit for the year ended 31st March, 2015.

(c) Proper and efficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

(d) The annual accounts for the year ended 31st March, 2015, have been prepared on a going concern basis.

(e) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

(f) That systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

8. Declaration by independent directors:

Mr. Rajiv Bhatt and Mr. Aashish Vyas are independent directors on the Board of the Company. The Company has received declaration from all the independent directors of the Company confirming that they meet the criteria of Independence as prescribed both under the Companies Act, 2013 and Clause 49 of the Listing Agreement.

9. Company's policy on Director's Appointment and Remuneration:

Pursuant to provisions of Section 178 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board of Directors of the Company, based on the recommendation of the Nomination and Remuneration Committee, has formulated Remuneration Policy.

The remuneration policy of the Company, inter alia, include the aims and objectives, principles of remuneration, guidelines for remuneration to Executive Directors and Non - Executive Directors, fixed and variable components in the remuneration package, criteria for identification of the Board Members and appointment of senior management.

The criteria for identification of the Board Members including that for determining qualification, positive attributes, independence etc. summarily given hereunder:

* The Board members shall possess appropriate skills, qualification, characteristics and experience. The objective is to have a Board with diverse background and experience in business, government, academics, technology, human resources, social responsibilities, finance, law etc. and in such other areas as may be considered relevant or desirable to conduct the Company's business in holistic manner.

* Independent Director shall be person of integrity and possess expertise and experience and / or someone who the Committee/Board believes could contribute to the growth /philosophy/strategy of the Company.

* In evaluating the suitability of individual board members, the Committee takes into account many factors, including general understanding of the Company's business dynamics, global business, social perspective, educational and professional background and personal achievements.

* Director should possess high level of personal and professional ethics, integrity, and values. He should be able to balance the legitimate interest and concerns of the company's stakeholders in arriving at decisions, rather than advancing interest of particular constituency.

* Director must be willing to devote sufficient time and energy in carrying out their duties and responsibilities effectively. He must have the aptitude to critically evaluate management's working as part of a team in an environment of collegiality and trust.

* The Committee evaluates each individual with the objective of having a group the best enables the success of the Company's business and achieve its objectives.

10. Particulars of loans, guarantees or investments:

Details of Loans, Guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements.

11. Related party transactions:

All transactions entered with Related Parties during the financial year were on an arm's length basis and were in the ordinary course of business and the provisions of Section 188 of the Companies Act, 2013 are not attracted. Thus, disclosure in Form AOC - 2 is not required. Further, there are no materially significant related party transactions during the year under the review made by the Company with promoters, directors, and key managerial personnel or the designated persons which may have a potential conflict with the interest of the Company at large.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website.

12. Energy conservation, technology absorption and foreign exchange earnings and outgo:

As required under the provisions of the Companies Act, 2013 and Rule 8(3) of Companies (Accounts) Rules, 2014 details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and outgo are given in Annexure B, which is annexed hereto and forms part of the Directors' Report.

13. Risk management:

Risk management is the process of identification, assessment, and prioritisation of risk followed by coordinated efforts to minimise, monitor and mitigate / control the probability and / or impact of unfortunate events or to maximise the realisation of opportunities.

14. Board evaluation:

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual evaluation of its own performance, the Directors individually as well as the evaluation of the working of the various committee. The independent directors also carried out the evaluation of the performance of the Chairman and the Non - Independent Directors, the details of which are covered in the Corporate Governance Report.

15. Criteria for evaluation of directors:

For the purpose of proper evaluation, the Directors of the Company have been divided into 3 (three) categories i.e. Independent, Non - Independent, & Non - Executive and Executive.

The criteria for evaluation includes factors such as engagement, strategic planning and vision, team spirit and consensus building, effective leadership, domain knowledge, management qualities, team work abilities, results/achievements, understanding and awareness, motivation/commitment/diligence, integrity/ethics/values and openness/receptivity.

16. Directors and key managerial personnel:

i. Mr. Ashok Kamath appointed as Chief Financial officer of the Company w.e.f. 01st Oct, 2014.

ii. Mr. Apoorva Shah, Chairman & Managing Director of the Company retires from the Board by rotation and eligible, offer himself for reappointment. The Board recommends his reappointment. The Board places on record its deep appreciation for the valuable contribution made by him during his tenure as Managing Director of the Company.

In view of the provisions of Section 203 of the Companies Act, 2013 Mr. Apoorva Shah, Chairman & Managing Director, Mrs. Alpa Shah, Whole - Time Director, Mr. Ashok Kamath, Chief Financial Officer and Ms. Suvarnalata Chavan, Company Secretary and Compliance Officer were identified and appointed as Key Managerial Personnel of the Company.

17. Material changes/commitments affecting the financial position, occurred after end of the financial year till date of report

No material changes have been occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report of Board like settlement of any tax liabilities, depression in market value of investments, institution of cases by or against the company, sale or purchase of capital assets or destruction of any assets etc.

18. DETAILS OF UNCLAIMED SHARE CERTIFICATES

In accordance with the requirements of the Clause 5A of the Listing Agreement, shares remaining unclaimed even after 3 reminders have to be transferred and held in a separate demat account. As per the information provided by the Registrars and Transfer Agent, No share remained unclaimed at the end of the year.

19. Deposits:

Your company has not accepted any public deposit during the financial period under review.

20. Details of significant and material orders passed by the regulators, courts and tribunals

No significant and material order has been passed by the regulators, courts, tribunals impacting the going concern status and company's operation in future.

21. Internal control and systems:

The Company has adequate internal control procedures commensurate with its size and nature of business. The objective of these procedure is to ensure efficient use and protection of the Company's resources, accuracy in financial reporting and due compliance of statutes and corporate policies and procedures.

The adequacy of internal control systems are reviewed by the Audit Committee of the Board in its periodical meetings.

22. VIGIL MECHANISM/WHISTLE BLOWER POLICY:

In Compliance with the provisions of Section 177(9) of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Company has framed a vigil mechanism/whistle blower policy to deal with unethical behaviour, actual or suspected fraud or violation of the Company's code of conduct or ethics policy, if any. The Vigil Mechanism / Whistle Blower Policy has also been uploaded on the website of the Company.

23. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

There has been no contract or arrangements entered into by the Company with any related party referred to in sub-section (1) of Section 188 of the Companies Act, 2013.

24. Particulars of employees:

As required under the provisions of the Companies Act, 2013 and Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, particulars of the employees concerned forms a part of Director's Report. Having regard of the provisions of Section 136 of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company.

25. Details relating to remuneration of directors, key managerial personnel and employees:

Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is marked as Annexure - C which is annexed hereto and forms part of the Director's Report.

26. Human resource:

One of the major reason for the sustained success of NHC Foods is our employees of the Company.

The Management of the Company fully recognise the fact that with a well-motivated and energized work force, is key of achieving of Company goals and aims.

The Human Resource Management in NHC Foods is concerned with the people's dimension in the organisation, facilitating the competencies and retention of skilled force, developing management systems that promote commitment, practices that foster team work and flexibility, making employees feel valued and rewarded. Our remuneration package also has a large in-built flexibility to suit individual needs and preferences. There is constant drive to keep the motivation levels of employees high and let them take part in operating decisions of the Company.

The recruitment policy ensure that it has the right number & kind of people at the right place and at right time, capable of effectively and efficiently completing those tasks that help the organisation achieve its overall objective.

27. Auditors and auditor's report

Statutory Auditor:

M/s NGS & Co. LLP, Chartered Accountants (Firm Registration No. 119850W) Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a confirmation from M/s. NGS & Co. LLP to the effect that their appointment, if made, at the ensuing AGM would be in terms of Section 139 and 141 of the Companies Act, 2013 and Rules made there under and that they are not disqualified for re-appointment.

Secretarial Auditor:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Board had appointed Mr. Dinesh Deora, Practising Company Secretary to conduct Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended 31st March, 2015 is annexed herewith and marked as "Annexure - D". The report is self-explanatory and do not call for any other comments.

28. Subsidiary / Joint Ventures / Associate Companies

Your company does not have any Subsidiary / Joint Ventures / Associate Companies.

29. Disclosure on Sexual Harassment of women at workplace

The Company has set up an Internal Complaints Committee for providing a redressal mechanism pertaining to sexual harassment of women employees at workplace. there was no case of sexual harassment reported during the year under review.

30. Acknowledgments :

The Board of Directors wish to place on record its sincere appreciation for the support received from its stakeholders, including shareholders, bankers, distributors, suppliers and business associates. The Directors recognize and appreciate the sincere, hard work, loyalty, dedicated efforts and contribution of all the employees that ensured sustained performance in a challenging business environment.

For and on behalf of Board of Directors,

Apoorva Shah (Chairman & Managing Director)

Registered Office:

NHC FOODS LTD. Survey No. 777, Umarsadi Desaiwad Road, Village Umarsadi, Taluka Pardi, District Valsad, Gujarat - 396175


Mar 31, 2014

Dear Members,

The Directors are pleased to present 22nd Annual Report and the Company''s audited accounts for the financial year ended March 31, 2014.

1. FINANCIAL HIGHLIGHTS

The Company''s financial performance, for the year ended March 31, 2014 is summarized below:

(Rs. In Lacs)

2013-2014 2012-2013

Total Income 14273.73 13785.64

Profit Before Depreciation & Tax 318.72 331.71

Less: Depreciation 100.49 92.32

Profit Before Tax 218.23 239.39

Current tax 46.00 46.93

Less: MAT Receivable 46.00 46.93

Less: Deferred Tax 62.77 78.32

Profit After Tax 155.46 161.07

2. Operations

During the year under review, your Company has recorded income of Rs. 14273.73 Lacs as against Rs. 13785.64 Lacs in the previous year.

Factory Automation:

(a) Our manufacturing unit in Valsad, Gujarat is set up with modern amenities and automated processing units imported from Germany and UK which are well controlled by computer systems, which ensures uniform and quality products.

(b) Our offices are well equipped and we use hi - tech machinery and technology and connectivity to interact with our clients and agents which on a daily basis, and enables us to respond to our buyer''s queries immediately, thereby shortening our turnaround time and satisfying their requirements which in turn help us to generate more enquiries and more orders.

(c) We are also using e-storm software a mass mailing software which helps us to mail our offers and introductions to multiple buyers at a time without having to send mails to each and every buyer individually. This software helps us target multiple buyers at a single time, thereby generating more enquiries which will help us in getting us more clients in the long run.

NHC Foods Limited - SAAZ:

During the month of Oct, 2011 we had launched our own brand "SAAZ" under which we produce more than twenty varieties of blended spices powders in the domestic market primarily in the states of Maharashtra, Gujarat, Goa. In order to expand the market and business of all products under the "SAAZ brand" to other states of India, the Company is in the process of tying up and entering into agreements/ arrangements with popular modern trade outlets to other states in India and is also considering setting our own retain shops under ownership and franchising models.

3. Current Outlook

Current Outlook, industrial structure & development along with opportunities and threats are discussed in the Management Discussion & Analysis Report, which forms part of the report.

4. Dividend

In order to conserve the resources for the future expansion plan of the Company under implementation, your Directors do not recommend any dividend for the year under review.

5. Extra Ordinary General Meeting held on 28th November, 2013:

The Shareholders of the Company in its meeting held on 28th November, 2013 have approved:

(a) The Board be and is hereby authorised to, in its absolute discretion create, issue, offer and allot equity shares/fully convertible debentures/partly convertible debentures/ non convertible debentures with warrants/any other securities (other than warrants) which are convertible into or exchangeable with equity shares for an amount not exceeding Rs. 40 Crores (Rupees Forty Crores Only) including such premium /discount as may be finalized by the Board.

(b) Increase in the limit of investment by Foreign Institutional Investors(FIIs) holding from 24% to 49% and limit of NRIs holding from 10% to 24% in terms of Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000.

6. Listing Agreement Compliances

Pursuant to the requirements of the Listing Agreement, the Company declares that its Equity Shares are listed on the BSE Ltd. Further we would like to inform you that the securities of the Company has been Delisted from Madras Stock Exchange Limited (MSE) w.e.f. 25.03.2014 under voluntary delisting process. The Company confirms that it has paid Annual Listing Fees due to BSE Ltd. for the year 2014-15.

7. Conversion of OCRPS

19,00,000 OCRPS were transferred from Mr. Apoorva Shah to non promoter group.

Further, the Board of Directors on the receipt of request from non-promoter group approved the conversion of 19,03,600 OCRPS into ordinary shares in the Board Meeting held on 20th Feb, 2014.

The OCRPS have been allotted pursuant to the Scheme of Amalgamation duly sanctioned by the Hon''ble High Court of Bombay on 11th Sept, 2010.

8. Technology & Quality

Sustained commitment to highest level of quality, best-in-class service management helped the Company attain number of milestones during the year.

Your Company has already obtained various quality certifications in its name, such as:

* ISO 22000:2005 - (Food Safety Management Systems) - is awarded to our plant at pardi, Gujarat, for laying down a set of standardized requirements for Food Safety Management Systems after satisfactory verification and validations of its Food Safety Management Systems. This certification would have following benefits to our organization:

* A truly global international standard that converse the majority of the requirements of the current food safety standards.

* An audible standard with clear requirements which provides a framework for third party certification.

* Our Company, has received the ''Star Export House Status'' from the Ministry of Commerce and Industry, office of Zonal Joint Director of Foreign Trade, a recognition granted to established exporters for promoting India''s exports and to building up marketing infrastructure and expertise required for export promotion.

* Halal India Certificate:

Our manufacturing plant located at Survey No. 777, Umarsadi Desaiwad Road, At Village Umarsadi, Taluka Pardi, District Valsad, Gujarat - 396175 has received a recognition granted by Halal India in accordance with Shariah (Islamic) Board Guidelines.

9. Management''s Discussion and Analysis Report

Management''s Discussion and Analysis Report for the year under the review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate action forming part of Annual Report.

10. Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts for the year ended March 31, 2014, the applicable accounting standards read with requirements set out under Schedule VI to the Companies Act, 1956, have been followed and there are no material departure from the same;

ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company as at March 31, 2014 and of the Profit of the Company for the year ended on that date;

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

iv) the Directors have prepared the annual accounts of the Company on going concern basis.

11. Auditors and Auditor’s Report

NGS & Co. LLP, Chartered Accountants, Statutory Auditors of the Company retires at the annual general meeting and are eligible for re-appointment. Pursuant to the provisions of Section 139 of the Act and Rules framed there under, it is proposed to appoint M/s NGS & Co. LLP as statutory auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company subject to ratification of such appointment by members at every AGM.

12. Cost Auditors

The Company has appointed Pasari & Associates as Cost Auditor for conducting the audit of cost records of the Company for the financial year 2014- 15.

Note: For the Financial year 2013-14 company has appointed Pasari & Associates as a Cost Auditor by passing of Board Resolution dated 12th May, 2014.

13. Secretarial Audit Report

As a measure of good corporate governance practice, the Board of Directors of the Company appointed Mr. Dinesh Deora, Practicing Company secretary, to conduct the Secretarial Audit. The Secretarial Audit Report for the financial year ended March 31, 2014, is provided in the Annual Report.

The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, the 98 Sections of the Companies Act, 2013 notified vide Ministry of Corporate Affairs Gazette Notification No. S.O. 2754(E) dated September 12, 2013, the Securities Contracts (Regulation) Act, 1956, Depositories Act, 1996, the Foreign Exchange Management Act, 1999 to the extent applicable to Overseas Direct Investment, Foreign Direct Investment (FDI) and External Commercial Borrowings (ECB), all the regulations and guidelines of SEBI as applicable to the Company, including the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, Listing Agreements with the Stock Exchanges and the Memorandum and Article of Association of the Company.

14. Particulars of Employees

Your Company does not have any employee of the category specified in Section 217(2A) of the Companies Act, 1956 and the Companies (Particular of Employees) Rules, 1975, as amended thereto from time to time.

15. Directors

Mr. Rajiv Bhatt retires by rotation at the ensuing annual general meeting and being eligible, has offered himself for re-appointment.

As per Section 149 of the Companies Act, 2013 (''The Act'') which come into effect from 1st April, 2014, every listed company is required to have at least one third of the total number of directors as Independent Directors (ID). The IDs shall hold office for a term up to 5 consecutive years from the date of commencement of the act. Accordingly, your Board recommends the appointment of Mr. Aashish Vyas and Mr. Rajiv Bhatt, Directors as Independent Directors of the Company.

16. Corporate Governance

The Company is committed to maintain the highest standard of corporate governance and adhere to the Corporate governance require set out by SEBI. The Company has also implemented several best corporate governance practices as prevalent globally.

The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of Annual Report.

The requisite certificate from Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49, is attached to the Report of Corporate Governance.

17. Finance and Accounts

Your Company continued to focus on cash generation. The focus on managing optimal level of inventory, sound business performance, operating efficiencies and cost savings helped generate healthy cash flows. Your Company managed investments prudently by deploying cash surplus in a balanced portfolio defined to offer primarily to safety and liquidity of the investments.

18. Appreciations and Acknowledgement

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as reputed Company.

Your Directors express their grateful appreciation for the assistance and co-operation extended by the Company''s Shareholders, Customers, Distributors, Bankers, Suppliers, Registrar and Share Transfer Agents, Employees and all other authorities/stakeholders during the year and look forward to their continued support in future years of growth.



For and on behalf of Board of Directors,

Apoorva Shah (Chairman & Managing Director)

Registered Office: NHC FOODS LTD. Survey No. 777, Umarsadi Desaiwad Road, Village Umarsadi, Taluka Pardi, District Valsad, Gujarat-396175


Mar 31, 2013

Dear Members,

The Directors are pleased to present their 21st Annual Report together with the Audited Financial Statement of Accounts along with the Report of the Auditors for the year ended 31st March, 2013.

1. FINANCIAL HIGHLIGHTS:

The Financial Highlights of your Company for the year under review are given below:

(Rs.In Lacs)

2012-2013 2011-2012

Total Income 13785.64 9326.27

Profit Before Depreciation & Tax 331.71 162.38

Less: Depreciation 92.32 87.09

Profit Before Tax 239.39 75.29

Current tax 46.93 11.26

Less: MAT Receivable 46.93 11.26

Less: Deferred Tax 78.32 28.98

Profit After Tax 161.07 46.31

2. Operations

During the year under review, your Company has recorded income of f 13785.64 Lacs as against Rs. 9326.27 Lacs in the previous year. The Net Profit for the financial year ended 31st March, 2013 increased to Rs. 161.07 Lacs from Rs. 46.31 Lacs in the previous year.

A) NHC Foods Limited - Saaz

- Saaz, initially launched in just two states, but in just 2 years it has started making presence in other states like Karnataka, Goa, Madhya Pradesh and Rajasthan.

- Roll out in a phased manner - Launch in Tier I cities of Gujarat, Mumbai & neighboring satellite towns. Over the year Saaz''s distribution network has expanded and started spreading its reach to the remote areas of Maharashtra and Gujarat.

- Vast Repertoire of 60 recipes of masalas and mixes - researched and concocted in-house. Initially launched - 14 masala types processed in-house.

B) NHC Foods Limited - Export

- NHC Foods Limited is a Government Recognized Star Export House engaged in the Business of Exports of Whole & Ground Spices, Lentils, Pulses, Grains, Oil Seeds and various other Agri - products and Assorted Food Products.

- Currently NHC Foods Limited is Exporting the above-mentioned Commodities to more than 60 Countries World-wide.

- Existing Clientele Countries:

Singapore, USA, Canada, Israel, Russia, Spain, New Zealand, Hong Kong, Malaysia, China, Indonesia, Vietnam, Thailand, Taiwan, UAE, Saudi Arabia, Kuwait, Bahrain, Turkey, Yemen, Egypt, Mauritius, Sri Lanka, Brazil, Ukraine, Macedonia, Iran, Pakistan, Bangladesh.

3. Current Outlook

Current outlook, industry structure & development along with opportunities and threats are discussed in the Management Discussion & Analysis Report, which forms part of this report.

4. Dividend:

In order to conserve the resources for the future expansion plan of the Company under implementation, your Directors do not recommend any dividend for the year under review.

5. Reclassification and Increase in Authorised Share Capital/Capital Raising Plans of the Company.

The Management of the Company is actively considering raising resources for increasing production capacity to meet competitive requirements of quality and value addition in both medium and long term:

a) Postal Ballot held on 21st Sept, 2012:

The Shareholders of the Company through postal ballot held on 21st Sept, 2012 have approved increase in Authorised Share Capital of the Company fromRs. 11,00,00,000/- divided into 35,00,000 Equity Shares of f 10/- each and 75,00,000 Preference Shares of Rs.10/- each to Rs. 19,00,00,000/- divided into 1,15,00,000 Equity Shares ofRs. 10/- each and 75,00,000 Preference Shares of Rs. 10/-.

b) Postal Ballot held on 07th March, 2013:

The Shareholders of the Company through postal ballot held on 07th March, 2013 have approved:

1. Reclassification of Authorised Share Capital of the Company of Rs. 19,00,00,000/- divided into 1,15,00,000 Equity Shares ofRs. 10/- each and 75,00,000 Preference Shares of Rs. 10/- each be and is hereby reclassified into 1,35,00,000 Equity Shares of Rs. 10/- each and 55,00,000 Preference Shares of Rs. 10/- each.

2. The Authorised Share Capital of the Company increased from Rs. 19,00,00,000/- divided into 1,35,00,000 Equity Shares of Rs. 10/- each and 55,00,000 Preference Shares of Rs. 10/- each to Rs. 24,00,00,000/- divided into 1,85,00,000 Equity Shares of Rs. 10/- each and 55,00,000 Preference Shares of Rs. 10/- each.

6. Preferential Allotment:

10,00,000 fully paid-up equity shares of the face value of Rs. 10/- each at a share premium of Rs. 12.60/- per share aggregating to Rs. 2,26,00,000/- of the Company allotted to the Investors- the non Promoters on Preferential basis on 05th Oct, 2012, on the terms and conditions as mentioned in the Special Resolution passed by the Shareholders through postal ballot held on 21st Sept, 2012.

7. Conversion of OCRPS:

20,89,200 OCRPS were allotted to Mrs. Hansa Shah pursuant to the scheme of amalgamation of M/s NHC Industries Private Limited with that of the Company, where OCRPS shall be converted in the ratio of 1 (One) New Equity Shares of the face value ofRs. 10/- each for every 1 (one) OCRPS of the face value of Rs. 10/- each.

Mrs. Hansa Shah exercised her option to convert 15,42,400 OCRPS (Optionally Convertible Redeemable Preference Shares) into Ordinary Shares. Accordingly, 15,42,400 Ordinary Shares of

Rs. 10/- each were allotted to Mrs. Hansa Shah on 05th Oct, 2012.

8. Delisting of shares:

The equity shares of the Company are voluntarily delisted from Ahmedabad Stock Exchange Limited (ASE) w.e.f. 21/02/2013.

9. Award / Recognition:

NHC Foods Limited have been awarded for Certificate of Merit from the Spices Board (Ministry of Commerce & Industry, Government of India) in recognition of outstanding performance in the Export of

Spices and Spices products for the year 2011-12.

10. Technology and Quality:

Sustained commitment to highest level of quality, best – in – class service management helped the Company attain number of milestones during the year.

Your Company has already obtained various quality certifications in its name, such as:

- *ISO 9001:2008 - for its satisfactory development, implementation and continual improvements in Management Operations Systems for procurement and dispatch of Whole & Grounded Spices and other food products and Miscellaneous assorted products for grocery.

- ISO 22000: 2005 - (Food Safety Management Systems) - is awarded to our plant at Pardi, Gujarat, for laying down a set of standardized requirements for Food Safety Management Systems after satisfactory verification and validations of its Food Safety Management Systems. This certification would have following benefits to our organization:

- A truly global international standard that converse the majority of the requirements of the current food safety standards.

- An auditable standard with clear requirements which provides a framework for third party certification.

(*The said certifications are transferred in the name of our Company from erstwhile, M/s. NHC Industries Private Limited, pursuant to the Scheme of Amalgamation).

- Our Company, has received the *''Star Export House Status'' by the Ministry of Commerce and Industry, Office of Zonal Joint Director of Foreign Trade, a recognition granted to established exporters for promoting India''s exports and to building up marketing infrastructure and expertise required for export promotion.

11 . Directors'' Responsibility Statement:

Pursuant to the requirement of Section 217(2AA) of the Act, and based on the representations received from the operating management, the Directors hereby confirm that:

i) In the preparation of the annual accounts for the financial year 2012-13, the applicable accounting standards have been followed and there are no material departures;

ii) They have selected such accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of profit of the Company for the financial year

iii) They have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities

iv) That the directors have prepared the annual accounts on a going concern basis

12. Conservation of energy, technology absorption and foreign exchange:

A Statement giving details of Conservation of Energy, technology absorption, foreign exchange earnings, and outgo in accordance with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to this report.

Report on Management Discussion and Analysis is provided in a separate section and forming part of this annual report.

13. Particulars of Employees:

Your Company does not have any employee of the category specified in Section 217 (2-A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rule, 1975, as amended thereto from time to time.

14. Internal Audit and Controls:

During the year under review, your Company has appointed M/s Surekha Associates, Chartered Accountants as its internal Auditor. Your Company continued to implement their suggestions and recommendations to improve the control environment

Their scope of work includes safeguarding the assets of your Company, review of operational efficiency, effectiveness of systems and processes and assessing the internal control strengths in all areas of operations,

The internal auditors finding are discussed with the processing person and suitable corrective actions are taken as per the directors of the Audit Committee on a going concern basis to improve the efficiency in operations.

15. Auditors and their Report:

In terms of provisions of Section 224 of the Companies Act, 1956, M/s NGS & Co. LLP, Chartered Accountants retire at this Annual General Meeting and being eligible, offer themselves for re- appointment. Pursuant to the recommendations of the Audit committee for reappointment of M/s NGS & Co. LLP as Statutory Auditors of the Company for the financial year 2013-14, the Board of Directors have, subject to the approval of the Shareholders have approved the re-appointment of M/s NGS & Co. LLP as Statutory Auditors of the Company for the financial year 2013-14 and to hold the office till the conclusion of the next of Annual General Meeting.

Resolution seeking your approval on this item is included in the Notice convening the Annual General Meeting. Members are requested to consider the appointment of M/s NGS & Co. LLP, Chartered Accountants, Mumbai, for the year 2013- 14, on a remuneration to be decided by the Board of Directors, in consultation with the said firm of Auditors.

16. Directors:

Pursuant to Article 138 of Article of Association of the Company Mr. Aashish Vyas, Non - Executive Independent Director of your Company retires from the office as Director of your Company, at the ensuing Annual General Meeting & being eligible, offers himself for re-appointment

The Board recommended the above re- appointment. Resolutions seeking your approval on these items are included in the Notice Convening Annual General Meeting together with brief resume of the Directors being re-appointed.

As situated by Clause 49 of the Listing Agreement, brief profile of the director seeking re-appointment, nature of his expertise in specific functional area and names of companies in which he is director are provided in the Annual report.

17. Depository System:

As the shareholders are aware, your Company''s shares are tradable in electronic form and the Company has established connectivity with both the depositories i.e. NSDL & CDSL. In view of the services offered by the Depository system, the shareholders are requested to avail the facility of dematerialization of the Company''s shares.

18. Fixed Deposits:

During the year under review, the Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 from the Public. Hence, as on 31st March, 2013 there are no unclaimed deposits lying with the Company.

19. Corporate Governance Report, Management Discussion and Analysis Report and Business Responsibility Report:

As per Clause 49 of the Listing Agreements entered into with the Stock Exchanges, Corporate Governance Report with Auditors'' Certificate and a Management Discussion and Analysis Report are attached and form part of this Report.

20. Listing Agreement Compliance:

Pursuant to the requirements of the Listing Agreement, the Company declares that its Equity Shares are listed on the Bombay Stock Exchange Limited (BSE), Madras Stock Exchange Limited (MSE). Further, we would like to inform you that the securities of the Company has been Delisted from Ahmedabad Stock Exchange Limited (ASE) w.e.f. 21.02.2013 under voluntary delisting process. The Company confirms that it has paid Annual Listing Fees due to Bombay Stock Exchange Limited and Madras Stock Exchange Limited for the year 2013-2014.

21. Acknowledgement:

Your Directors express their grateful appreciation for the assistance and co-operation extended by the Company''s Shareholders, Customers, Distributors, Bankers, Suppliers, Registrar and Share Transfer Agents, Employees and all other authorities/ stakeholders during the year and look forward to their continued support in future years of growth.

For and on behalf of Board of Directors,

Apoorva Shah

(Chairman & Managing Director)

Registered Office:

NHC FOODS LTD.

Survey No. 777,

Umarsadi Desaiwad Road, Village Umarsadi,

Taluka Pardi, District Valsad,

Gujarat – 396175

Place: Mumbai

Date: 17th July, 2013


Mar 31, 2010

The Directors present their Eighteenth Annual Report together with the Audited Financial Statement of Accounts along with the Report of the Auditors for the year ended 31st March 2010.

FINANCIAL HIGHLIGHTS

The Financial Highlights OF YOUR COMPANY for the year under review are given below :

(Rupees in lacs)

2009-2010 2008-2009

Total Income 7,219.04 -

Profit/(Loss) Before Depreciation 149.41 (3.19)

Less : Depreciation 62.42 3.24

Profit/(Loss) Before Tax 86.99 (6.43)

Less : Provision for Income Tax 7.00 -

Less: Earlier year adjustments 12.95 -

Less: Extra-Ordinary items - 28.09

Less : Deferred Tax Liability 39.86 (1.70)

Profit/(Loss) After Tax 27.18 (32.82)

OPERATIONS :

During the year under review, pursuant to the sanction of the High Court, Bombay for the Scheme of Amalgamation of NHC Industries Private Limited, with the Company, the financial results reflects the consolidated working of the erstwhile NHC Industries Private Limited, with your Company. Post Amalgamation, your company has recorded a turnover of Rs. 7146.18 Lakhs.

DIVIDEND :

In order to conserve the resources for the future expansion plan of the company & plans under implementation, your Directors do not recommend any dividend for the financial year 2009 - 2010.

CORPORATE FINANCIAL RESTRUCTURING :

1. REDUCTION OF EQUITY SHARE CAPITAL OF THE COMPANY:

As you are aware that at the Annual General Meeting of your Company held on 14th August, 2009, the resolution for reduction of Equity Share Capital under section 100 to 104 of the Companies Act, 1956 was passed. The Honble High Court of Judicature at Bombay vide their order dated 09th October, 2009 has duly confirmed the said resolution and the Equity Share Capital of the Company stands reduced from Rs. 3,00,11,000/-comprising of 30,01,100 Equity Shares of Rs. 10/-each fully paid-up to Rs. 1,05,03,850/- comprising of 10,50,385 Equity Shares of Rs. 10/- each by canceling / reducing of Rs. 1,95,07,150/- divided into 19,50,715 Equity Shares of Rs. 10/- each in the paid-up Equity Share Capital which is lost or unrepresented by the available assets.

Thus, the present paid-up Equity Share Capital of the Company is Rs. 1,05,03,850/- comprising of 10,50,385 Equity Shares of Rs. 10/- each.

2. REVOCATION OF SUSPENSION IN TRADING :

The Board of Directors of the company had applied to the Bombay Stock Exchange for the Revocation of Suspension of trading in Equity Shares of the Company. On completing of all the revocation formalities, the Bombay Stock Exchange had vide their Notice no. 20100120-10 dated January 20, 2010 granted approval for trading in Equity Shares of the Company from Friday, January 19, 2010. Accordingly, the Equity shares of the company are now actively traded on the Bombay Stock Exchange Limited.

3. SCHEME OF AMALGAMATION :

As you are aware, the business of NHC Industries Private Limited has been merged with your company w.e.f 1st April, 2009, being the appointed date fixed for the purpose, pursuant to the scheme of Amalgamation under Section 391-394 and other relevant provisions of the Companies Act, 1956 (the "Act"). Pursuant to the scheme of Amalgamation and in consideration thereof, your company has issued 5 (five) Equity Shares of the Company of Rs. 10/- each fully paid-up for every 4 (four) Equity Shares of Rs. 10/- each fully paid-up held in the Share Capital of NHC Industries Private Limited (NHC) and 4 (four) 0% Optionally Convertible Redeemable Preference Shares of the Company of Rs. 10/- each fully paid up for every 1 (one) Equity Shares of Rs. 10/- each fully paid up held in the Share Capital of NHC Industries Private Limited to the erstwhile shareholders of NHC as on 9th September, 2010. The Scheme of Amalgamation has become effective on 7th September, 2010; having filed the certified copies of the High Court order with the Registrar of Companies, Maharashtra, Mumbai.

Upon amalgamation, your Company will be able to derive economies of scale and create a platform for future substantial growth and development, which shall in turn be beneficial to the entire stakeholder.

CORPORATE GOVERNANCE :

Accountability and integrity with total transparency continue to be the companys main objective towards achieving sustained growth. During the year under review, your Company was in compliance with the provisions of Clause 49 of the Listing Agreement with the stock exchanges relating to corporate governance.

Certificate of the Auditors of the Company regarding compliance of the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement with the Stock Exchange, is enclosed.

PARTICULARS OF EMPLOYEES :

Your Company does not have any employee of the category specified in Section 217 (2-A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

AUDIT COMMITTEE :

The Audit Committee of the Company met on 30.06.2009, 31.07.2009, 30.10.2009 and 14.01.2010 during the year under review.

DIRECTORS RESPONSIBILITY STATEMENT :

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to Directors Responsibilities Statement, your Directors hereby confirm:

(1) that in the preparation of the annual accounts for the year ended 31st March, 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures.

(2) that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for that period;

(3) that the directors have taken proper and sufficient care of the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(4) that the directors have prepared the annual accounts on a going concern basis.

SAFETY AND ECOLOGY:

Safety and Environment protection strategies continue to be accorded the same priority.

FIXED DEPOSITS :

During the year under review, the Company has not accepted any Deposits within the meaning of Section 58Aof the Companies Act, 1956 from the Public. Hence, as on 31s< March, 2010 there are no unclaimed deposits lying with the Company.

DIRECTORS:

Mr. Aashish Vyas, was appointed as an additional director (non- executive independent director) with effect from 30th October, 2009 and Mrs. Alpa Shah, was appointed as an additional director (non-executive promoter director) with effect from 11th September, 2010 respectively, to hold office till the conclusion of the ensuing Annual General Meeting. The company has pursuant to Section 257, received notices in writing from a Member proposing their candidature for office of Directors, liable to retire by rotation.

Mr. Amit Shah, non-executive independent director of your company retires from the office as Director of your Company, at the ensuing Annual General Meeting, however has expressed his unwillingness to continue as the Director and it is proposed not to fill the casual vacancy caused by his retirement at the said meeting or any adjournment thereof. The Directors place on record their appreciation of the services rendered by Mr. Amit Shah, during his tenure as members of the Board.

Mr. Rajiv Bhatt, non-executive independent director, retires from the office as Director of your Company at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

The Board recommends the above appointment. Resolutions seeking your approval on these items are included in the Notice convening the Annual General Meeting together with a brief resume of the Directors being appointed/re-appointed.

AUDITORS :

M/s. NGS & Co., Chartered Accounts, Mumbai be appointed as the Statutory Auditors of the Company to hold office from the conclusion of the ensuing Annual General Meeting till the conclusion of the next Annual General Meeting of the Company. M/s. NGS& Co., Chartered Accountants, Mumbai have forwarded their certificates to the Company, stating that their appointment, if made, will be within the limit specified in that behalf in Sub-section (1B) of Section 224 of the Companies Act, 1956.

The Board proposes the re-appointment of M/s. NGS & Co., Chartered Accountants, Mumbai as Statutory Auditors of your Company based on the recommendation of the Audit Committee, to hold office from the conclusion of the ensuing Annual General Meeting until the conclusion of the next Annual General Meeting.

Resolutions seeking your approval on these items are included in the Notice convening the Annual General Meeting.

Members are requested to consider the appointment of M/s. NGS & Co., Chartered Accountants, Mumbai, for the current year, on a remuneration to be decided by the Board of Directors in consultation with the said firm of Auditors.

AUDITORS QUALIFICATION :

Observations made in the Auditors Report read with relevant notes in Notes to Accounts, are self explanatory and therefore do not call for any further comments under Section 217(3) of the companies Act, 1956.

CONSERVATION OF ENERGY:

The Company is not covered under the list of specified industries. However, required conservation measures are already taken for limiting power consumption to the extent necessary.

FOREIGN EXCHANGE EARNINGS AND OUTGO :

(Rs. in Lacs)

Earnings: 6448.14 (Previous Year: Rs. Nil)

Outgoing: 119.56 (Previous Year: Rs. NIL)

LISTING AGREEMENT COMPLIANCE :

Pursuant to the requirements of the Listing Agreement, the Company declares that its Equity Shares are listed on the Bombay Stock Exchanges Ltd., Ahmedabad Stock Exchange Ltd., and Madras Stock Exchange Ltd. The Company confirms that it has paid Annual Listing Fees due to all the Stock Exchanges for the year 2009-2010.

ACKNOWLEDGEMENT :

Yours Directors express their grateful appreciation for the assistance and co-operation extended by the Companys shareholders, customers, Bankers, Suppliers, employees and all other authorities/ stakeholders during the year and look forward to their continued support in future.

For and on behalf of the Board,

(APOORVA H. SHAH) Place : Mumbai (Chairman & Director) Date: 15-10-2010

Registered Office:

D-22/8, MIDC,

TTC Industrial Area, Thane-Belapur Road,

Turbhe, Navi Mumbai

 
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