Mar 31, 2018
BOARD OF DIRECTORSâ REPORT
To,
Members,
SKM Egg Products Export (India) Limited
The directors are pleased to present their report on your Company''s business operations along with the audited financial statements for the financial year ended on 31 March 2018.
Financial Highlights : (Standalone)
(Rs. in Lacs)
DESCRIPTION |
year ended 31.3.2018 |
year ended 31.3.2017 |
Total Income |
29,921.54 |
21,791.87 |
Earnings Before Interest, Taxes, Depreciation and Amortization |
1,956.32 |
1,736.42 |
Less : Financial Cost |
235.46 |
489.26 |
Less : Depreciation & Amortization |
1,295.32 |
1,203.55 |
Profit Before Tax |
425.53 |
43.62 |
Less: Tax Expenses |
||
-Current |
174.40 |
49.31 |
-Deferred Tax |
155.05 |
(184.65) |
Profit/(Loss) for the period |
96.08 |
178.96 |
Other Comprehensive Income (net of tax) |
(19.08) |
71.60 |
Profit After Tax and available for appropriation |
77.00 |
250.56 |
Appropriations |
||
Proposed dividend |
- |
- |
Dividend Distribution Tax |
- |
- |
Surplus carried to Balance Sheet |
77.00 |
250.56 |
DESCRIPTION |
year ended 31.3.2018 |
year ended 31.3.2017 |
The Consolidated Total Income |
33,478.51 |
25,552.34 |
2.OPERATIONS:The company''s total Revenue is Rs.299.22 Crores during the current year as against Rs.217.92 Crores during the previous year. The Export during the year has been Rs.194.17 Crores as compared to Rs.165.82 Crores during the previous year 2016-17.
3.DIVIDEND:
The Board has recommended dividend at the rate of Rs.0.50 (5%) per equity share of the company for the year ended 31st March 2018.
4.AMOUNTS TRANSFERRED TO RESERVES:
The Board of the company has decided/proposed to carry Rs. Nil to its reserves.
Reserve |
Amount (Rs) |
Transfer to Statutory Reserve |
NIL |
Transfer to Capital Reserve |
NIL |
Transfer to General Reserve |
NIL |
Transfer to Investment Reserve |
NIL |
Transfer to Special Reserve |
NIL |
5. SHARE CAPITAL:
The paid up Equity Share Capital as on March 31, 2018 was Rs. 26, 33, 00,000. During the year under review the company has not issued any shares or any convertible instruments.
6. CORPORATE GOVERNANCE:
Your company reaffirms its commitment to good corporate governance practices. The company complies with corporate governance requirements specified in regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Pursuant to Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Report on Corporate Governance which forms a part of this Report, has been annexed herewith as Appendix - A
7. DEMATERIALISATION OF SHARES:
89.35 % of the company''s paid up Equity Share Capital is in dematerialized form as on 31 st March, 2018 and balance 10.65% is in physical form. The Company''s Registrar is M/s S.K.D.C. Consultants Ltd., having their registered office at Kanapathy Towers, 3rd Floor, 1391/A1, Sathy Road, Ganapathy, Coimbatore-641 006.
8. NUMBER OF BOARD MEETINGS:
The Board of Directors duly met 4 times during the financial year from 1st April, 2017 to 31st March, 2018. The dates on which the meetings were held are as follows: 30.05.2017, 09.08.2017, 13.11.2017 and 06.02.2018. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.
9. INVESTOR EDUCATION AND PROTECTION FUND:
Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (âthe Rules''), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred the unclaimed and unpaid dividends. Further, the corresponding shares will be transferred as per the requirements of the IEPF rules, details of which are provided on our website, at www.skmegg.com.
10. BUSINESS RISK MANAGEMENT:
Although the company has long been following the principle of risk minimization as is the norm in every industry, it has now become a compulsion. Therefore, in accordance with SEBI (LODR) Regulations 2015 of the listing Regulations the Board members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the company. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business.
In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. In today''s challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, competition, Business risk, Technology obsolescence, Investments, retention of talent and expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk, legal risk. As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same. The risk management policy has been placed on the website of the company. www.skmegg.com
11. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company''s internal control systems have been strengthened taking into account the nature of business and size of operations to provide for :
i) Reliability and integrity of financial and operational information;
ii) Effectiveness and efficiency of operations and assets;
iii) Compliance with applicable statutes, policies, listing requirements and management policies and procedures.
The Company, through its own Corporate Internal Audit Department, carries out periodic audits at all locations and all functions and brings out any deviation to internal control procedures. The observations arising from audit are periodically reviewed and compliance ensured. The summary of the Internal Audit observations is submitted to the Audit Committee. The Audit Committee at its meetings regularly reviews the financial, operating, internal audit & compliance reports to improve performance. The heads of various monitoring / operating cells are present for the Audit Committee meetings to answer queries from the Audit Committee.
12. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The brief outline of the Corporate Social Responsibility (CSR) Policy as recommended by the CSR Committee and approved by the Board of Directors of the Company and the initiatives undertaken by the Company on CSR Activities during the year are set out in the Appendix-B of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The CSR Policy is available on the website of the Company www.skmegg.com.
CSR Committee meeting held on 24th March, 2018 and attended by all three members. The Minutes of the CSR Committee are noted by the Board. The details of the composition of the Committee, meetings held, attendance at the meetings along with sitting fees paid, are given in Table.
NAME |
CATEGORY |
POSITION |
NO.OF MEETINGS |
SITTING FEES PAID (In Rs.) |
|
Held |
Attended |
||||
Dr.L.M.Ramakrishnan |
ID* |
Chairman |
1 |
Yes |
NIL |
Shri.C.Devarajan |
ID* |
Member |
1 |
Yes |
NIL |
Smt.S.Kumutaavalli |
NED** |
Member |
1 |
Yes |
NIL |
13. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In order to ensure that the activities of the Company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behavior the company has adopted a vigil mechanism policy. This policy is explained in corporate governance report and also posted on the website of company. The policy is available on the Company''s Website www.skm.egg.com..
14. RELATED PARTY TRANSACTIONS:
All the transactions entered with the related parties during the financial year were on an arm''s length basis and were in the ordinary course of business. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee /Board for its omnibus approval and since there are no transactions which are not on arm''s length basis and material in nature Form AOC-2 is annexed as Appendix - C.
The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules there under and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.skmegg.com.
15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars, as prescribed under sub-section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are given in the Appendix-D to this report..
16. EXTRACT OF ANNUAL RETURN:
In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the annual return in Form MGT-9 is annexed herewith as Appendix-E
17. DETAILS OF DIRECTORS&COMMITTEES:
A. Composition:
The Company has a very balanced and diverse Board of Directors, which primarily takes care of the business needs and stakeholders'' interest. The Non-executive Directors including Independent Directors on the Board are experienced, competent and highly renowned persons from the fields of manufacturing, finance & taxation, economics, law, governance etc. They take active part at the Board and Committee Meetings by providing valuable guidance to the Management on various aspects of business, policy direction, governance, compliance etc. and play critical role on strategic issues, which enhances the transparency and add value in the decision making process of the Board of Directors. The composition of the Board also complies with the provisions of the Companies Act, 2013 and the Listing Agreement. As at the end of corporate financial year 2018, the total Board strength comprises of the following:
Executive Director |
2 |
Non-Independent Directors & Non-Executive Directors (including woman Director) |
2 |
Independent Directors |
5 |
Nominee Director-TIDCO |
1 |
Total Strength |
10 |
Name of the Director and Designation |
Name of the Company |
Position |
SKM Animal Feeds and Foods (India) Private Ltd |
Whole Time Director |
|
Shri.SKM Maeilanandhan |
SKM Siddha and Ayurvedha Company (India) Private Limited |
Director |
(Executive Chairman) |
SKM Universal Marketing Company India Private Limited |
Director |
Agro Corpex India Limited |
Director |
|
SKM Siddha and Ayurvedha Company (India) Private Limited |
Director |
|
Shri.SKM Shree Shivkumar |
SKM Universal Marketing Company India Private Limited |
Managing Director |
(Managing Director) |
SKM Shrees Farms India Private Limited |
Director |
SKM Shree Developers India Private Limited |
Director |
|
SKM Shree Herbals India Private Limited |
Director |
|
SKM Shree Energy India Private Limited |
Director |
|
SKM Shrees Properties India Private Limited |
Director |
|
SKM Siddha and Ayurvedha Company (India) Private Limited |
Managing Director |
|
Smt.S.Kumutaavalli (Non-Executive Director) |
SKM Universal Marketing Company India Private Limited |
Director |
SKM Shree Developers India Private Limited |
Director |
|
SKM Shree Herbals India Private Limited |
Director |
|
SKM Shrees Properties India Private Limited |
Director |
|
Shri.S.M.Venkatachalapathy |
SKM Siddha and Ayurvedha Company (India) Private Limited |
Director |
(Non-Executive Director) |
SKM Shrees Farms India Private Limited |
Director |
SKM Shree Energy India Private Limited |
Director |
Name of the Director and Designation |
Name of the Company |
Position |
Shri.P Kumarasamy (Independent Director) |
SKM Universal Marketing Company India Private Limited |
Director |
Dr.L.M.Ramakrishnan (Independent Director) |
Ponni Sugars (Erode) Ltd |
Director |
Knitvel Needles (PVT) Ltd |
Director |
|
Erode Medical Suppliers(P) Ltd |
Managing Director |
|
Hawker & West off Shoring Consulting Services (P) Ltd |
Director |
|
Shri.C.Devarajan (Independent Director) |
OREOPS Framework Private Limited |
Director |
URC Infotec (P) Ltd |
Managing Director |
|
URC Creative Developers (P) Ltd |
Director |
|
Erode Textile Mall Private Ltd |
Director |
|
Five P Venture India (P) Ltd |
Director |
|
URC Power Product (P) Ltd |
Director |
|
Texvally Weekly Market Ltd |
Director |
|
Texvally Market Limited |
Director |
|
Institute for Lean Construction Excellence |
Director |
|
URC Construction (P) Ltd |
Director |
|
Shri.M.Chinnian (Independent Director) |
SKM Universal Marketing Company India Private Limited |
Director |
Shri.B.Ramakrishnan (Nominee Director - TIDCO) |
Saptarishi Agro Industries Limited |
Director |
Sattva Agro Expo Private Ltd |
Director |
|
Devaraj Agro Industries Private Limited |
Director |
|
Nilgiris Flower Company Limited |
Nominee Director |
|
Intgen Agro Products Limited |
Nominee Director |
|
Tamilnadu Telecommunication Limited |
Nominee Director |
|
Shri.D.Venkateswaran (Independent Director) |
Balkart Brothers (India) Private Limited |
Director |
Ulavan Producer Company Limited |
Director |
|
Mega Agri Business Consortium Producer Company Limited |
Director |
S. No. |
Name of Directors |
Audit Committee |
Stakeholders Relationship Committee |
Nomination and Remuneration Committee |
Corporate Social Responsibility Committee |
1. |
Smt.S.Kumutaavalli |
- |
- |
- |
Member |
2. |
S.M.Venkatachalapathy |
- |
- |
Member |
- |
3. |
Dr.L.M.Ramakrishnan |
Member |
Member |
Chairman |
Chairman |
4. |
Shri.C.Devarajan |
- |
- |
- |
Member |
5. |
Shri.M.Chinnian |
Chairman |
Member |
Member |
- |
6. |
Shri.B.Ramakrishnan |
Member |
- |
- |
- |
7. |
Shri.PKumarasamy |
- |
Chairman |
- |
- |
8. |
Shri.D.Venkateswaran |
- |
- |
- |
- |
C. No. of other Board Committees they are Members / Chairman:
17.1 BOARD EVALUATION
Pursuant to the provisions of Section 134 (3) (p), 149(8) and Schedule IV of the Companies Act, 2013 and SEBI (Listing Obligations and disclosures requirements) Regulations 2015, annual Performance Evaluation of the Directors as well as of the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee has been carried out. The Performance Evaluation of the Independent Directors was carried out by the entire Board and the Performance Evaluation of the Chairman and Non- Independent Directors was carried out by the Independent Directors. The Independent Directors of the company have also convened a separate meeting for this purpose. The policy is available on the website of the company at ww.skmegg.com.
17.2 REMUNERATION POLICY
A. Policy on remuneration to Non-Executive Directors/Independent Directors
The policy of the Company, based on the recommendation of the Nomination & Remuneration Committee for the payment of remuneration to Non-executive Directors/Independent Directors of the company is that the Non-Executive Directors will be paid only sitting fees for attending Board and Committees of the Board which is fixed within the limits of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The policy is available on the website of the company at www.skmegg.com.
B. Policy on remuneration to MD & Executive Director, Key Managerial Personnel and other employees
The Compensation/Remuneration policy of the Company as approved by the Board contains the policy for payment of remuneration to Executive Directors including MD & Key managerial personnel and for the employees of the Company. The policy is available on the website of the company at www.skmegg.com.
17.3 MEETINGS
During the year four board meetings and one independent directors'' meeting were held. The Details of which are given in Corporate Governance Report.
17.4 AUDIT COMMITTEE:
i) Terms of reference:
The Audit Committee reviews the audit reports submitted by the Internal Auditors and Statutory Auditors, financial results, effectiveness of internal audit processes and the Company''s risk management strategy. It reviews the Company''s established Systems and the Committee is governed by a Charter which is in line with the regulatory requirements mandated by the Companies Act, 2013 and Listing Regulations.
The board has accepted the audit committee recommendations during the year whenever required and hence no disclosure is required under section 177 (8) of the company''s act 2013 with respect to rejection of any recommendation of audit committee by the board.
ii) Composition :
The Audit Committee of the Company consists of three Independent Directors. The Chairman of the Audit Committee is financially literate and majority of them having accounting or related financial management experience. Representative of Statutory Auditor is permanent invitee. Company Secretary acts as Secretary to the Committee.
iii) No. of Meetings held during the year:
During the year the Committee had 4 Meetings i.e. 30.05.2017, 09.08.2017, 13.11.2017 and 06.02.2018.
iv) Composition, name of Members and attendance during the year:
NAME |
POSITION |
NO.OF MEETINGS |
|
HELD |
ATTENDED |
||
Shri.M.Chinnian |
Chairman |
4 |
4 |
Shri.L.M.Ramakrishnan |
Member |
4 |
3 |
Shri.B.Ramakrishnan |
Member |
4 |
1 |
17.5 NOMINATION AND REMUNERATION COMMITTEE:
i) Terms of reference:
This Committee shall identify the persons, who are qualified to become Directors of the Company / who may be appointed in Senior Management in accordance with the criteria laid down, recommend to the Board their appointment and removal and also shall carry out evaluation of every director''s performance. Committee shall also formulate the criteria for determining qualifications, positive attributes, Independent of the Directors and recommend to the Board a Policy, relating to the remuneration for the Directors, Key Managerial Personnel and other employees.
ii) Composition:
The Nomination and Remuneration Committee of the Company consists of one Non-Executive and two Independent Directors including Chairman.
iii) No. of Meetings held during the year:
During the year no Committee meeting held.
17.6 STAKEHOLDERS RELATIONSHIP COMMITTEE:
i) Terms of reference:
The Committee focuses primarily on monitoring expeditious Redressal of investors / stakeholders grievances and also functions in an efficient manner that all issues / concerns stakeholders are addressed / resolved promptly.
ii) Composition of the Committee:
The Committee consists of three Independent Directors.
iii) No. of meetings held and attended during the year:
During the year the 4 Stakeholders Relationship Committee Meetings were held i.e. on 30.05.2017, 09.08.2017, 13.11.2017 and 06.02.2018.
The attendance of the Members at the meeting was as under:
NAME |
POSITION |
NO.OF |
MEETINGS |
HELD |
ATTENDED |
||
Shri.P Kumarasamy |
Chairman |
4 |
4 |
Shri.L.M. Ramakrishnan |
Member |
4 |
4 |
Shri.M. Chinnian |
Member |
4 |
4 |
iv) Name and Designation of Compliance Officer :
Mr. Sekar. P Company Secretary and Compliance Officer. Shareholderâs Services:
S.No. |
Nature of Complaints |
2017-2018 |
|
Received |
Answered |
||
1st Quarter |
0 |
0 |
0 |
2nd Quarter |
0 |
0 |
0 |
3rd Quarter |
0 |
0 |
0 |
4th Quarter |
0 |
0 |
0 |
Year |
Date |
Venue |
Time |
Special Resolution |
2014-15 |
23.09.2015 |
N.S.A Mahal, Club Melaange, 314, 315, Perundurai Road, Erode - 638 011 |
4.00 P.M |
Special Resolutions were passed in this meeting |
2015-16 |
02.09.2016 |
Registered Office at 185, Chennimalai Road, Erode - 638 001 |
4.00 P.M |
Special Resolutions were passed in this meeting |
2016-17 |
27.09.2017 |
Registered Office at 185, Chennimalai Road, Erode - 638 001 |
4.00 P.M |
Special Resolutions were passed in this meeting |
17.7 GENERAL BODY MEETINGS: Location and time for the last three AGMs:
18. INDEPENDENT DIRECTORS MEETING:
During the year under review, the Independent Directors of the Company met on 24.03.2018, inter alia, to discuss:
i) Evaluation of performance of Non- Independent Directors and the Board of Directors of the Company as a whole.
ii) Evaluation of performance of the Chairman of the Company, taking into views of Executive and Non-Executive Directors.
iii) Evaluation of the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
19. DECLARATION BY INDEPENDENT DIRECTOR:
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16 (1) (b) of the SEBI (LODR) Regulations, 2015.
20. FAMILIARIZATION PROGRAMME OF INDEPENDENT DIRECTORS:
In Compliance with the requirements of SEBI Listing Regulations, the Company has put in place a familiarization programme for Independent Directors to familiarize them with their role, rights and responsibility as Directors, business overviews etc.
The details familiarization programmes are available on the website of the Company www.skmegg.com.
21. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143 (12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There were no instances of frauds identified or reported by the Statutory Auditor during the course of their audit.
22. MATERIAL CHANGES AND COMMITMENTâS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes or commitments affecting the financial position of the company during the year.
23. REPORT ON THE PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS.
The company has foreign subsidiary. The statement pursuant to section 129 (3) Companies Act, 2013 containing the salient features of the financial statement of subsidiary company forms part of this Annual Report as AOC-1 in Appendix-F.
The board has approved a policy for determining material subsidiary which has been uploaded on the company''s website viz. www.skmegg.com
24. PUBLIC DEPOSITS
The Company has not accepted any deposits from the public within the meaning of Sections 73 to 76 of the Companies Act, 2013 for the year ended 31 st March, 2018.
25. INTERNAL COMPLIANTS COMMITTEE:
Your company has upheld the letter and spirit contained in "The Sexual Harassment of Women at Workplace (Prevention, prohibition and Redressal) Act, 2013â. (the act). Board of Directors had resolved to constitute Internal Complaints Committees to function as per the provisions laid down in the Act and also to support the women employees by way of counseling. We further state that during the financial year under review there were no complaints received / cases filed under "The Sexual Harassment of Women at Workplace (Prevention, prohibition and Redressal) Act, 2013â(the act).
26. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mrs. S Kumutaavalli (DIN: 00002390), Director of the company retires by rotation at the ensuring Annual General Meeting of the Company under section 152(6) of the Companies Act, 2013 and being eligible, offers herself for re-appointment. Your Directors recommend her re-appointment. The brief resume of Mrs. S Kumutaavalli and other relevant information have been furnished in the Notice of Annual General Meeting (AGM). Appropriate resolutions for her appointment are being placed for approval of the shareholders at the AGM.
Key Managerial personnel of the company as required pursuant to section 2(51) and 203 of the Companies Act, 2013 are Shri. SKM. Maeilanandhan, Executive Chairman, Shri. SKM Shree Shivkumar, Managing Director, Shri. K.S. Venkatachalapathy, Chief Financial Officer and Shri. P Sekar, Company Secretary.
27. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion and Analysis Report for the year under review as stipulated under the Listing Regulations with the stock exchanges in India is presented in a separate section forming part of this Annual Report in Appendix-G.
28. DIRECTORSâ RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013:
a) that in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b) that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made 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 of the Company for the year ended on that date;
c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) that the annual financial statements have been prepared on a going concern basis;
e) that proper 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.
29. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.
30. CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in the nature of business of the Company during the financial year ended 31 st March, 2018.
31. AUDITORS:
31.1 STATUTORY AUDITORS
The Audit Committee and the Board of Directors of the Company have recommended the re-appointment of Mr.Prasanna Venkatesan N, Chartered Accountant, Erode (MN 235530) as the statutory auditor of the Company, subject to the approval of the shareholders. Mr Prasanna Venkatesan N has consented to the said appointment and confirmed that his appointment, if made would be within the limit mentioned under the provision of the Companies Act, 2013 and the Companies (Audit and Auditor) Rules, 2014 .
He will hold office as statutory auditor for the period of one year from the conclusion of the 23rd Annual General Meeting till the conclusion of 24th Annual General Meeting.
31.2 SECRETARIAL AUDITOR
The Board of Directors in its meeting dated 9th August, 2017, appointed Mr. V. Ramkumar, Company Secretary in Practice, Coimbatore. (CP No.:3832, Membership No: F 8304), to undertake the secretarial audit of the company for the year ended 31st March 2018, in compliance with the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, The Secretarial Audit Report for the financial year 31st March, 2018 is enclosed as Appendix-H.
31.3 INTERNAL AUDITOR
The company has appointed Mr. R.Muralidharan, B.Com, FCA., Chartered Accountant as the internal Auditor of the company and their report is reviewed by the audit committee and Board from time to time.
31.4 COST AUDITOR
As per the provisions of companies (cost Records and Audit) Rules 2014, cost Audit is not applicable to the company for the financial year ended 31st March 2018 for the company.
32. COMMENTS ON AUDITORSâ REPORT:
There were observations made by the Statutory Auditor and the Secretarial auditor and they are being addressed and attended to by the Board
33. CONSOLIDATED FINANCIAL STATEMENTS:
Pursuant to Section 129 of the Companies Act, 2013, the Company has prepared a Consolidated Financial Statements of the Company and also of its Subsidiary, âSKM Europe BVâ, Utrecht, the Netherlands, in same form and manner as that of the Company which shall be laid before the ensuing Annual General Meeting of the Company along with laying of the Company''s Financial Statement under section 129 sub-section (2) i.e. Standalone Financial Statement of the Company.
34. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
The Company has not granted any fresh loans or guarantees or provided any security in connection with any loan to any other body corporate or person covered under the provisions of Section 186 of Companies Act 2013.
35. PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is annexed herewith as appended as âAppendix-Iâ
36. STOCK EXCHANGE INFORMATION:
The Company''s Equity Shares are listed on:
1. BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001 and
2. NSE Limited, "Exchange Plazaâ, Bandra-Kurla Complex Bandra East, Mumbai -400 051.
The annual listing fees have been paid to all the Stock Exchanges as mentioned above.
Movement in the Market Price of the Companyâs Shares on the National Stock Exchange and Bombay stock exchanges
37. INTERNAL CONTROLS:
The Company has a system of internal control which examines both the financial effectiveness and operational effectiveness to ensure reliability of financial and operational information and all statutory/ regulatory compliances.
38. INSIDER TRADING CODE:
The Company has formulated a code for prevention of Insider Trading pursuant to Securities and Exchange Board of India (Insider Trading) (Amendment) Regulation 2002 to prevent the practices of Insider Trading. Mr. P Sekar, Company Secretary has been designated as Compliance Officer for this purpose. Senior Management of the Company has affirmed compliance with the Code of Conduct applicable as on 31.03.2018. The Company has duly complied with all the mandatory listing agreement. Code of Conduct for Insider Trading Regulation available on the Company''s Website www.skmegg.com.
39. INDUSTRIAL RELATIONS:
The industrial relations continued to be generally peaceful and cordial during the year.
40. CEO/CFO CERTIFICATION:
As per Regulation 17 of the Listing Regulations, Shri SKM Shree Shivkumar, Chief Executive Officer of the company and Shri K.S. Venkatachalapathy, Chief Financial Officer of the company have certified regarding the Financial Statements for the year ended March 31, 2018 which is annexed to this Report in Appendix-J.
41. MEANS OF COMMUNICATION:
The quarterly, unaudited and annual audited financial results were published in nationally circulated newspapers in English, such as, Trinity Mirror and in regionally circulated in Makkal Kural. The results were also displayed on the Company''s website - www.skmegg.com.
42. GENERAL INFORMATION FOR SHAREHOLDERS ANNUAL GENERAL MEETING
Date : 26.09.2018
Time : 4.00 PM
Venue : Registered Office situated at 185, Chennimalai Road, Erode-638 001
Financial Year : 1 st April 2017 to 31st March 2018
Period of Book Closure : 20.09.2018 to 26.09.2018 FINANCIAL CALENDER:
Approval of quarterly results for the period ending:
1. 30th June 2017 : 9th August 2017
2. 30th September 2017 : 13th November 2017
3. 31st December 2017 : 6th February 2018
4. 31s* March 2018 : 28th May 2018
43. REGISTRAR AND SHARE TRANSFER AGENT:
S.K.D.C. Consultants Limited Kanapathy Towers,
3rd Floor, 1391/A1, Sathy Road,
Ganapathy, Coimbatore-641 006.
44. COMPLIANCE OFFICER:
Mr. Sekar. P Company Secretary
Address: 185, Chennimalai Road, Erode
Email:[email protected]
Mob No:9585558325
45. ACKNOWLEDGEMENTS:
The Directors express their sincere appreciation to the valued shareholders, suppliers, bankers, business partners/associates, financial institutions for their support and encouragement to the Company. We look forward to receiving the continued patronage from all quarters to become a better and stronger company.
46. CAUTIONARY STATEMENT:
Statements in this Annual report, particularly those which relate to management discussion and analysis, describing your Company''s objectives, projections, estimates and expectations may constitute "forward looking statementsâ within the meaning of applicable laws and regulations. Actual results may materially differ from those expressed or implied.
For and on behalf of the Board of Directors
Sd/-
Date : 3°.°7.2018 Chairman of the Board
Place : Erode (DIN:00002380)
Mar 31, 2016
BOARD OF DIRECTORS'' REPORT
Dear Shareholders,
The Board of Directors has immense pleasure in presenting the 21st Annual Report of SKM EGG PRODUCTS EXPORT (INDIA) LIMITED along with the Audited Financial Statement of Accounts for the year ended 31st March, 2016.
1. SUMMARISED FINANCIAL HIGHLIGHTS
(Rs. in Lacs)
Financial Parameters For the Year ended |
31st March 2016 |
31st March 2015 |
Total Income |
28,268.56 |
28,714.86 |
Profit/ (Loss) before Interest and Depreciation and Tax |
4,775.99 |
5,317.06 |
Less: Financial Cost |
253.58 |
503.62 |
Depreciation & Amortization |
1,207.51 |
1,330.87 |
Profit Before tax |
3,314.90 |
3,482.58 |
Less: Provision for Tax |
||
Current |
1223.38 |
467.34 |
MAT Credit entitlement |
0.00 |
0.00 |
Deferred Tax |
(173.45) |
496.50 |
Profit After Tax and available for appropriation |
2,264.97 |
2,518.74 |
Appropriations |
||
Proposed dividend |
263.30 |
263.30 |
Dividend Distribution Tax |
53.91 |
53.91 |
Surplus carried to Balance Sheet |
1947.76 |
2,201.53 |
2. OPERATIONS:
The Company''s total revenue is Rs.282.69 Crores during the current year as against Rs.287.15 Crores during the previous year. The export during the year has been Rs.254.83 Crores as compared to Rs.258.74 Crores during the previous year 2014-15.
3. DIVIDEND:
The Board of Directors meeting held on 16 th March, 2016 declared interim dividend at the rate of Rs.1/- per equity share on face value of Rs.10/- each for the financial year 2015-16. Hence, your directors have not recommended any final dividend for the financial year 2015-16.
4. AMOUNTS TRANSFERRED TO RESERVES:
The Board of the company has decided/proposed to carry Rs. NIL to its reserves.
Reserve |
Amount (Rs) |
Transfer to Statutory Reserve |
NIL |
Transfer to Capital Reserve |
NIL |
Transfer to General Reserve |
NIL |
Transfer to Investment Reserve |
NIL |
Transfer to Special Reserve |
NIL |
5. SHARE CAPITAL:
The paid up Equity Share Capital as on March 31, 2016 was Rs. 26, 33, 00,000 /-. During the year under review the company has not issued any shares or any convertible instruments.
6. CORPORATE GOVERNANCE:
The Company has obtained a Certificate from its Statutory Auditors regarding compliance of the conditions of Corporate governance, as stipulated in Regulations 27 of SEBI (Listing Obligation & Disclosure requirements) Regulations, 2015, which together with this Report on Corporate Governance is annexed to the Directors'' Report and shall be sent to all the members of the Company and the Stock Exchanges along with the Annual Report of the Company. (Refer Appendix - A).
7. DEMATERIALISATION OF SHARES:
88% of the company''s paid up Equity Share Capital is in dematerialized form as on 31st March, 2016 and balance 12% is in physical form. The Company''s Registrar is M/s S.K.D.C. Consultants Ltd., having their registered office at Kanapathy Towers, 3rd Floor, 1391/A1, Sathy Road, Ganapathy, Coimbatore - 641 006.
8. NUMBER OF BOARD MEETINGS HELD :
The Board of Directors duly met 5 times during the financial year from 1st April, 2015 to 31st March, 2016. The dates on which the meetings were held are as follows: 20.05.2015, 29.07.2015, 30.10.2015, 27.01.2016, and 16.03.2016.
9. INVESTOR EDUCATION AND PROTECTION FUND:
As per the Companies Act 2013, dividend unclaimed for more than seven years from the date of declaration is to be transferred to investor education and protection fund. During the financial year 2015-16 the Company has not transferred any fund.
10. BUSINESS RISK MANAGEMENT:
Although the company has long been following the principle of risk minimization as is the norm in every industry, it has now become a compulsion. Therefore, in accordance with SEBI (Listing Obligation & Disclosure requirements) Regulations, 2015, the Board members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the risk management plan for the company. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. In today''s challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, Competition, Business risk, Technology obsolescence, Investments, retention of talent and expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk, legal risk. As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same.
11. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company has adequate system of internal control to safeguard and protect from loss, unauthorized use or disposition of its assets. All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting financial statements. The internal auditor of the company checks and verifies the internal control and monitors them in accordance with policy adopted by the company.
The Directors confirm that the Internal Financial Controls (IFC) are adequate with respect to the operations of the Company. A report of Auditors pursuant to Section 143(3) (I)of the Companies Act, 2013 certifying the adequacy of Internal Financial controls is annexed with the Auditors Report.
12. CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE:
The Board of Directors had formed a CSR comprising of 1.Dr.L.M.Ramakrishnan, 2.Shri.C.Devarajan, and Smt.S,Kumutaavalli. During the year 2015-2016, the Committee met once i.e. on 16.03.2016.The Minutes of the CSR Committee are noted by the Board.
The details of the composition of the Committee, meetings held, attendance at the meetings along with sitting fees paid, are given in Table.
NAME |
CATEGORY |
POSITION |
NO.OF MEETINGS |
SITTING FEES |
|
Held |
Attended |
PAID (In Rs.) |
|||
Dr.L.M.Ramakrishnan |
ID* |
Chairman |
1 |
Yes |
NIL |
Shri.C.Devarajan |
ID* |
Member |
1 |
Yes |
NIL |
Smt.S.Kumutaavalli |
NED** |
Member |
1 |
Yes |
NIL |
(*ID-Independent Director ** Non-executive Director)
The report on CSR activities form a part of financial statement.
13. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In order to ensure that the activities of the Company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behaviour the company has adopted a vigil mechanism policy. This policy is explained in corporate governance report and also posted on the website of company.
14. RELATED PARTY TRANSACTIONS:
All the transaction entered into with related parties during the financial year were on an arm''s length basis and were in the ordinary course of business. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval. Since there are no transactions which are not on arm''s length basis and material in nature Form AOC-2 is not being annexed.
The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013, the Rules there under and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.skmegg.com.
15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
Considering the nature of activities of the Company, the provisions of Section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is given in the Appendix-B to this report.
16. EXTRACT OF ANNUAL RETURN:
The extract of the Annual Return pursuant to the provisions of section 92, of the Company Act, 2013 read with rule 12 of the companies management and administrative rule, 2014 in Form MGT-9 is annexed herewith as Appendix-C.
17. DETAILS OF DIRECTORS & COMMITTEES:
A. Composition:
The Company has a very balanced and diverse Board of Directors, which primarily takes care of the business needs and stakeholders'' interest. The Non-executive Directors including Independent Directors on the Board are experienced, competent and highly renowned persons from the fields of manufacturing, finance & taxation, economics, law, governance etc. They take active part at the Board and Committee Meetings by providing valuable guidance to the Management on various aspects of business, policy direction, governance, compliance etc. and play critical role on strategic issues, which enhances the transparency and add value in the decision making process of the Board of Directors. The composition of the Board also complies with the provisions of the Companies Act, 2013 and the SEBI (Listing Obligation & Disclosure requirements) Regulations, 2015, as at the end of corporate financial year 2016, the total Board strength comprises of the following:
Executive Director |
2 |
Non-Independent Directors & Non-Executive Directors |
2 |
Independent Directors |
5 |
Nominee Director - TIDCO |
1 |
Total Strength |
10 |
B. Particulars of Directorships of other Companies:
OTHER DIRECTORSHIPS
Name of the Director and Designation |
Name of the Company |
Position |
Shri.SKM Maeilanandhan (Executive Chairman) |
SKM Animal Feeds and Foods (India) Private Ltd SKM Siddha and Ayurvedha Company (India) Private Limited SKM Universal Marketing Company India Private Limited Agro Corpex India Limited |
Whole-time Director Director Director Director |
Shri.SKM Shree Shivkumar (Managing Director) |
SKM Siddha and Ayurvedha Company (India) Private Limited SKM Universal Marketing Company India Private Limited SKM Shrees Farms India Private Limited SKM Shree Developers India Private Limited SKM Shree Herbals India Private Limited SKM Shree Energy India Private Limited SKM Shrees Properties India Private Limited |
Managing Director Director Director Director Director Director Director |
Smt.S.Kumutaavalli (Non-Executive Director) |
SKM Siddha and Ayurvedha Company (India) Private Limited SKM Universal Marketing Company India Private Limited SKM Shree Developers India Private Limited SKM Shree Herbals India Private Limited SKM Shrees Properties India Private Limited |
Whole-Time Director Director Director Director Director |
Shri.S.M.Venkatachalapathy (Non-Executive Director) |
SKM Siddha and Ayurvedha Company (India) Private Limited SKM Shrees Farms India Private Limited SKM Shree Energy India Private Limited |
Director Director Director |
Shri.R Kumarasamy (Independent Director) |
SKM Universal Marketing Company India Private Limited |
Director |
Dr.L.M.Ramakrishnan (Independent Director) |
Ponni Sugars(Erode) Ltd Knitvel Needles (PVT) Ltd (India) Limited Erode Medical Suppliers(P) Ltd Hawker & West off Shoring Consulting Services (P)Ltd |
Director Director Managing Director Director |
Shri.C.Devarajan (Independent Director) |
Bharathiya School of Management OREOPS Framework Private Limited Madras Institute of Project Management Consultancy (P) Ltd URC Creative Developers (P) Ltd URC Infotec (P) Ltd URC Power Product (P) Ltd Erode Textile Mall Private Ltd Ulavar Kalangium Ltd Five P Venture India (P) Ltd URC Salmoc J V Infrastructure Private Limited Texvally Weekly Market Ltd Texvally Market Limited Institute for Lean Construction Excellence |
Director Director Director Director Managing Director Director Director Managing Director Managing Director Director Director Director Director |
Shri.M.Chinnian (Independent Director) |
SKM Universal Marketing Company India Private Limited |
Director |
Name of the Director and Designation |
Name of the Company |
Position |
Shri.B.Ramakrishnan |
Vishnu Fabrics Private Limited |
Director |
Occimum Pharma Private Limited |
Director |
|
(Nominee Director) |
Saptarishi Agro Industries Limited |
Director |
TIDCO |
Sattva Agro Expo Private Ltd |
Director |
Devaraj Agro Industries Private Limited |
Director |
|
Nilgiris Flower Company Limited |
Director |
|
Intgen Agro Products Limited |
Director |
|
Tamil nadu Telecommunication Limited |
Director |
|
Shri.D.Venkateswaran |
Balkart Brothers (India) Private Limited |
Director |
(Independent Director) |
Ulavan Producer Company Limited |
Director |
Mega Agri Business Consortium Producer Company Ltd. |
Director |
C. No. of other Board Committees in which they are Members / Chairman:
S.No. |
Name of Directors |
Audit Committee |
Stakeholders Relationship Committee |
Nomination and Remuneration Committee |
Corporate Social Responsibility Committee |
1. |
Smt.S.Kumutaavalli |
- |
- |
- |
Member |
2. |
S.M.Venkatachalapathy |
- |
- |
Member |
- |
3. |
Dr.L.M.Ramakrishnan |
Member |
Member |
Chairman |
Chairman |
4. |
Shri.C.Devarajan |
- |
- |
- |
Member |
5. |
Shri.M.Chinnian |
Chairman |
Member |
Member |
- |
6. |
Shri.B.Ramakrishnan |
Member |
- |
- |
- |
7. |
Shri.P.Kumarasamy |
- |
Chairman |
- |
- |
8. |
Shri.D.Venkateswaran |
- |
- |
- |
- |
17.1 ANNUAL EVALUATION OF THE BOARD ON ITS OWN PERFORMANCE AND OF THE INDIVIDUAL DIRECTORS.
Pursuant to the provisions of Section 134 (3) (p), 149(8) and Schedule IV of the Companies Act, 2013 and SEBI (Listing Obligations and disclosures requirements) Regulations 2015, Annual Performance Evaluation of the Directors as well as of the Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee has been carried out. The Performance Evaluation of the Independent Directors was carried out by the entire Board and the Performance Evaluation of the Chairman and Non- Independent Directors was carried out by the Independent Directors. The independent Directors of the company have also convened a separate meeting for this purpose.
17.2 REMUNERATION POLICY
A. Policy on remuneration to Non-Executive Directors/Independent Directors
The policy of the Company, based on the recommendation of the Nomination & Remuneration Committee for the payment of remuneration to Non-executive Directors/Independent Directors of the company is that the Non-Executive Directors will be paid only sitting fees for attending Board and Committees of the Board which is fixed within the limits of Companies Act, 2013 and SEBI (Listing Obligations and disclosures requirements) Regulations 2015.
B. Policy on remuneration to MD & Executive Director, Key Managerial Personnel and other employees
The Compensation/Remuneration policy of the Company as approved by the Board contains the policy for payment of remuneration to Executive Directors including MD & Key managerial personnel and for the employees of the Company.
17.3 MEETINGS
During the year Five Board Meetings and One independent directors'' meeting were held. The Details of which are given in Corporate Governance Report.
17.4 AUDIT COMMITTEE:
i) Terms of reference:
The Audit Committee reviews the audit report submitted by the Internal Auditors and Statutory Auditors, financial results, effectiveness of internal audit processes and the Company''s risk management strategy. It reviews the Company''s established Systems and the Committee is governed by a Charter which is in line with the regulatory requirements mandated by the Companies Act, 2013 and SEBI (Listing Obligations and disclosures requirements) Regulations 2015.
The Board has accepted the audit committee recommendations during the year whenever required and hence no disclosure is required under section 177(8) of to companies act, 2013 with respect to rejection of any recommendations of Audit committee by the Board.
ii) Composition :
The Audit Committee of the Company consists of three Independent Directors. The Chairman of the Audit Committee is financially literate and majority of them having accounting or related financial management experience. Representative of Statutory Auditor is permanent invitee. Company Secretary acts as Secretary to the Committee.
iii) No. of Meetings held during the year :
During the year the Committee had 4 Meetings i.e. 20.05.2015, 29.07.2015 ,30.10.2015, and 27.01.2016.
iv) Composition, name of Members and attendance during the year:
NAME |
POSITION |
NO.OF MEETINGS |
|
HELD |
ATTENDED |
||
Shri.M.Chinnian |
Chairman |
4 |
3 |
Shri.L.M.Ramakrishnan |
Member |
4 |
4 |
Shri.B.Ramakrishnan |
Member |
4 |
4 |
17.5 NOMINATION AND REMUNERATION COMMITTEE:
i) Terms of reference:
This Committee shall identify the persons, who are qualified to become Directors of the Company / who may be appointed in Senior Management in accordance with the criteria laid down, recommend to the Board their appointment and removal and also shall carry out evaluation of every director''s performance. Committee shall also formulate the criteria for determining qualifications, positive attributes, Independent of the Directors and recommend to the Board a Policy, relating to the remuneration for the Directors, Key Managerial Personnel and other employees.
ii) Composition:
The Nomination and Remuneration Committee of the Company consists of one Non-Executive and two Independent Directors including Chairman.
iii) No. of Meetings held during the year:
During the year the Committee had 3 meetings on 20.05.2015, 29.07.2015 and 27.01.2016.
iv) Composition, name of Members and attendance during the year:
NAME |
POSITION |
NO.OF MEETINGS |
|
HELD |
ATTENDED |
||
Shri.L.M.Ramakrishnan |
Chairman |
3 |
3 |
Shri.S.M.Venkatachalapathy |
Member |
3 |
2 |
Shri.M.Chinnian |
Member |
3 |
3 |
17.6 STAKEHOLDERS RELATIONSHIP COMMITTEE:
i) Terms of reference:
The Committee focuses primarily on monitoring expeditious redressal of investors / stakeholders grievances and also functions in an efficient manner that all issues / concerns stakeholders are addressed / resolved promptly.
ii) Composition of the Committee:
The Committee consists of one Non-Executive and two Independent Directors.
iii) No. of meetings held and attended during the year :
During the year the 4 Stakeholders Relationship Committee Meetings were held i.e. on 20.05.2015, 29.07.2015, 30.10.2015 and 27.01.2016.
The attendance of the Members at the meeting was as under :
NAME |
POSITION |
NO.OF MEETINGS |
|
HELD |
ATTENDED |
||
Shri. PI Kumarasamy |
Chairman |
4 |
4 |
Shri. LM. Ramakrishnan |
Member |
4 |
4 |
Shri. M. Chinnian |
Member |
4 |
3 |
iv) Name and Designation of Compliance Officer:
Mr. Sekar. P Company Secretary and Compliance Officer. Shareholder''s Services:
S.No. |
Nature of Complaints |
2015-2016 |
|
Received |
Answered |
||
1st Quarter |
- |
- |
- |
2nd Quarter |
- |
- |
- |
3rd Quarter |
- |
- |
- |
4th Quarter |
- |
- |
- |
17.7 GENERAL BODY MEETINGS:
Location and time for the last two AGMs:
Year |
Date |
Venue |
Time |
Special Resolution |
2013-2014 |
10.09.2014 |
N.S.A Mahal, Club Melaange, 314,315, Perundurai Road, Erode - 638 011 |
4.00 P.M |
Special Resolutions have been passed |
2014-2015 |
23.09.2015 |
N.S.A Mahal, Club Melaange, 314,315, Perundurai Road, Erode - 638 011 |
4.00 P.M |
Special Resolutions have been passed |
18. INDEPENDENT DIRECTORS MEETING:
During the year under review, the Independent Directors of the Company met on 16.03.2016, inter alia, to discuss:
i) Evaluation of performance of Non- Independent Directors and the Board of Directors of the Company as a whole.
ii) Evaluation of performance of the Chairman of the Company, taking into views of Executive and Non-Executive Directors.
iii) Evaluation of the quality, content and time lines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
19. DECLARATION BY INDEPENDENT DIRECTOR:
The Company has received necessary declaration from each independent director under section 149(7) of the Companies Act, 2013 that they meet the criteria of independence laid down in section 149(6) of the Companies Act, 2013, and SEBI (Listing Obligations and disclosures requirements) Regulations 2015.
20. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143 (12) OF THE COMPANIES ACT, 2013 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There were no instances of frauds identified or reported by the Statutory Auditor during the course of their audit.
21. MATERIAL CHANGES AND COMMITMENT''S AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes or commitments affecting the financial position of the company during the year.
22. REPORT ON THE PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS.
The company has foreign subsidiary. The statement pursuant to section 129 (3) Companies Act, 2013 containing the salient features of the financial statement of subsidiary company forms part of this Annual Report.
The board has approved a policy for determining material subsidiary which has been uploaded on the company''s website viz. www.skmegg.com
23. FIXED DEPOSITS
During the year the company did not accept or renew any fixed deposits and no fixed deposits remained unclaimed with the company as on 31st March 2016.
24. INTERNAL COMPLAINTS COMMITTEE:
Your company has upheld the letter and spirit contained in âThe Sexual Harassment of Women at Workplace (Prevention, prohibition and Redressal) Act, 2013â. (the act). Board of Directors had resolved to constitute Internal Complaints Committees to function as per the provisions laid down in the Act and also to support the women employees by way of counseling.
a. No. of complaints received in the year 2015 â 2016 : NIL
b. No. of complaints disposed of during the year 2015 â 2016 : NIL
c. Nature of action taken by the employer/district officer : NIL
25. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Mrs. S. Kumutaavalli, Director of the company retires by rotation at the ensuring Annual General Meeting and being eligible, offers herself for re-appointment. Your Directors recommend her re-appointment.
Key Managerial personnel of the company as required pursuant to section 2(51) and 203 of the Companies Act, 2013 are Shri. SKM. Maeilanandhan, Executive Chairman, Shri. SKM Shree Shivkumar, Managing Director, Shri. K.S. Venkatachalapathy, Chief Financial Officer and Shri. P Sekar, Company Secretary.
26. MANAGEMENT DISCUSSION AND ANALYSIS:
The Management Discussion and Analysis Report for the year under review as stipulated under SEBI (Listing Obligations and disclosures requirements) Regulations 2015 with the stock exchanges in India is presented in a separate section forming part of this Annual Report in Appendix-D.
27. DIRECTORS'' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013:
a) that in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b) that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made 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 of the Company for the year ended on that date;
c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) that the annual financial statements have been prepared on a going concern basis;
e) that proper 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.
28. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There is no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.
29. CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in the nature of business of the Company during the financial year ended 31st March, 2016.
30. AUDITORS:
30.1 STATUTORY AUDITORS
M/s. N.C. Rajagopal & Co., Chartered Accountants, Erode (Firm Registration No.003398S), the present statutory auditors of the company retires at the ensuing Annual General Meeting and are eligible for reappointment, and the Company proposes to reappoint M/s. N.C. Rajagopal & Co., Chartered Accountants as statutory auditors of the company from the conclusion of the ensuing Annual General Meeting up to the conclusion of next Annual General Meeting of the Company.
30.2 SECRETARIAL AUDITOR
The Board had in its meeting dated 29th July 2015, appointed Mr. V. Ramkumar, Company Secretary in Practice, Coimbatore. (CP No.:3832, Membership No: FCS 8304), to undertake the secretarial audit of the company for the year ended 31st March 2016, in compliance with the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,.
30.3 INTERNAL AUDITOR
Mr. R.Muralidharan, B.Com, FCA., Chartered Accountant performs the duties of internal auditor of the company and their report is reviewed by the audit committee from time to time.
31. COMMENTS ON AUDITORS'' REPORT:
There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. N.C. Rajagopal & Co., Statutory Auditors and Mr. V. Ramkumar, Secretarial auditor in their reports.
32. ACKNOWLEDGEMENTS:
The company has been very well supported from all quarters and therefore your directors wish to place on record their sincere appreciation for the support and co-operation received from Employees, Dealers, Suppliers, Central and State Governments, Bankers and others associated with the Company. Your Directors wish to thank the banks, financial institutions, shareholders and business associates for their continued support and cooperation. We look forward to receiving the continued patronage from all quarters to become a better and stronger company.
For and on behalf of the Board of Directors
Date : 25.05.2016
Place : Erode Chairman of the Board
DIN: 00002380
Mar 31, 2015
Dear Shareholders,
The Board of Directors has immense pleasure in presenting the 20th
Annual Report of SKM EGG PRODUCTS EXPORT (INDIA) LIMITED along with the
Audited Financial Statement of Accounts for the year ended 31st March,
2015.
1. SUMMARISED FINANCIAL HIGHLIGHTS
(Rs. in Lacs)
Financial Parameters
For the Year ended 31st March 2015 31st March 2014
Total Income 28,714.86 24,043.15
Profit/ (Loss) before Interest and
Depreciation and Tax 5,317.06 3,072.16
Less: Financial Cost 503.62 835.86
Depreciation & Amortization 1,330.87 1,262.72
Profit Before tax 3,482.58 973.58
Less: Provision for Tax
Current 467.34 0.00
MAT Credit entitlement 0.00 0.00
Deferred Tax 496.50 292.99
Profit After Tax and available for
appropriation 2,518.74 680.59
Appropriations
Proposed dividend 263.30 0.00
Dividend Distribution Tax 53.91 0.00
Surplus carried to Balance Sheet 2,201.53 680.59
2. OPERATIONS:
The Company's total revenue is Rs.287.15 Crores during the current year
as against Rs.240.43 Crores during the previous year. The export during
the year has been Rs.258.74 Crores as compared to Rs.216.53 Crores
during the previous year 2013-14.
3. DIVIDEND:
The Board of Directors have recommended a dividend of 10%, i.e., Re.
1/- per equity share on face value of Rs.10/-each for the year
2014-2015, subject to the approval of the members in the Annual General
Meeting. Enhancing the Shareholders value has always been a guiding
philosophy of the Company.
4. AMOUNTS TRANSFERRED TO RESERVES:
The Board of the company has decided/proposed to carry Rs. NIL to its
reserves.
Reserve Amount (Rs )
Transfer to Statutory Reserve NIL
Transfer to Capital Reserve NIL
Transfer to Investment Reserve NIL
Transfer to Special Reserve NIL
5. SHARE CAPITAL:
The paid up Equity Share Capital as on March 31, 2015 was Rs. 26, 33,
00,000 /-. During the year under review the company has not issued any
shares or any convertible instruments.
6. CORPORATE GOVERNANCE:
The Company has obtained a Certificate from its Statutory Auditors
regarding compliance of the conditions of Corporate governance and
Brief resume of the directors seeking appointment / reappointment and
other details as stipulated in Clause 49 & 49 (VIII) (E) of the Listing
Agreement, which together with this Report on Corporate Governance is
annexed to the Directors' Report and shall be sent to all the members
of the Company and the Stock Exchanges along with the Annual Report of
the Company. (Refer Appendix-A).
7. DEMATERIALISATION OF SHARES:
85% of the company's paid up Equity Share Capital is in dematerialized
form as on 31st March, 2015 and balance 15% is in physical form. The
Company's Registrar is M/s S.K.D.C. Consultants Ltd., having their
registered office at Kanapathy Towers, 3rd Floor, 1391/A1, Sathy Road,
Ganapathy, Coimbatore-641 006.
8. NUMBER OF BOARD MEETINGS HELD :
The Board of Directors duly met 6 times during the financial year from
1st April, 2014 to 31st March, 2015. The dates on which the meetings
were held are as follows: 21.04.2014, 14.05.2014, 30.05.2014,
30.07.2014, 31.10.2014 and 27.01.2015.
9. INVESTOR EDUCATION AND PROTECTION FUND:
As per the Companies Act 2013, dividend unclaimed for more than seven
years from the date of declaration is to be transferred to investor
education and protection fund. On 22.05.2014 the Company has
transferred Rs. 3, 47,627/- to the above fund, being the unclaimed
dividend for the year 2004-2005.
10. BUSINESS RISK MANAGEMENT:
Although the company has long been following the principle of risk
minimization as is the norm in every industry, it has now become a
compulsion. Therefore, in accordance with clause 49 of the listing
agreement the Board members were informed about risk assessment and
minimization procedures after which the Board formally adopted steps
for framing, implementing and monitoring the risk management plan for
the company. The main objective of this policy is to ensure sustainable
business growth with stability and to promote a pro-active approach in
reporting, evaluating and resolving risks associated with the business.
In order to achieve the key objective, the policy establishes a
structured and disciplined approach to Risk Management, in order to
guide decisions on risk related issues. In today's challenging and
competitive environment, strategies for mitigating inherent risks in
accomplishing the growth plans of the Company are imperative. The
common risks inter alia are: Regulations, competition, Business risk,
Technology obsolescence, Investments, retention of talent and expansion
of facilities. Business risk, inter-alia, further includes financial
risk, political risk, fidelity risk, legal risk. As a matter of
policy, these risks are assessed and steps as appropriate are taken to
mitigate the same.
11. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company has adequate system of internal control to safeguard and
protect from loss, unauthorized use or disposition of its assets. All
the transactions are properly authorized, recorded and reported to the
Management. The Company is following all the applicable Accounting
Standards for properly maintaining the books of accounts and reporting
financial statements. The internal auditor of the company checks and
verifies the internal control and monitors them in accordance with
policy adopted by the company.
12. CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE:
In accordance with Section 135 of the Companies Act, 2013, the Board of
Directors of the Company at its meeting held on 14.05.2014, have
constituted the CSR Committee which comprises of 1.Dr.L.M.Ramakrishnan,
2.Shri.C.Devarajan, and Smt.S,Kumutaavalli. During the year 2014-2015,
the Committee met once i.e. on 21.05.2014.The Minutes of the CSR
Committee are noted by the Board.
13. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In order to ensure that the activities of the Company and its employees
are conducted in a fair and transparent manner by adoption of highest
standards of professionalism, honesty, integrity and ethical behaviour
the company has adopted a vigil mechanism policy. This policy is
explained in corporate governance report and also posted on the website
of company.
14. RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year
were on an arm's length basis and were in the ordinary course of
business. Transactions with related parties entered by the Company in
the normal course of business are periodically placed before the Audit
Committee for its omnibus approval and the particulars of contracts
entered during the year as per Form AOC-2 is enclosed as Appendix-B.
The Board of Directors of the Company has, on the recommendation of the
Audit Committee, adopted a policy to regulate transactions between the
Company and its Related Parties, in compliance with the applicable
provisions of the Companies Act, 2013, the Rules thereunder and the
Listing Agreement. This Policy was considered and approved by the Board
has been uploaded on the website of the Company at www.skmegg.com.
15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Considering the nature of activities of the Company, the provisions of
Section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the
Companies (Accounts) Rules, 2014 relating to conservation of energy,
technology absorption and foreign exchange earnings and outgo is given
in the Appendix-C to this report.
16. EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form
MGT-9 is annexed herewith as Appendix-D.
17. DETAILS OF DIRECTORS & COMMITTEES:
A. Composition:
The Company has a very balanced and diverse Board of Directors, which
primarily takes care of the business needs and stakeholders' interest.
The Non-executive Directors including Independent Directors on the
Board are experienced, competent and highly renowned persons from the
fields of manufacturing, finance & taxation, economics, law, governance
etc. They take active part at the Board and Committee Meetings by
providing valuable guidance to the Management on various aspects of
business, policy direction, governance, compliance etc. and play
critical role on strategic issues, which enhances the transparency and
add value in the decision making process of the Board of Directors. The
composition of the Board also complies with the provisions of the
Companies Act, 2013 and the Listing Agreement. As at the end of
corporate financial year 2014, the total Board strength comprises of
the following:
Executive Director 2
Non-Independent Directors & Non-Executive Directors 2
Independent Directors 5
Total Strength 9
Pursuant to the provisions of Section 134 (3) (p), 149(8) and Schedule
IV of the Companies Act, 2013 and Clause 49 of the Listing Agreement,
annual Performance Evaluation of the Directors as well as of the Audit
Committee, Nomination and Remuneration Committee, Stakeholders
Relationship Committee has been carried out. The Performance Evaluation
of the Independent Directors was carried out by the entire Board and
the Performance Evaluation of the Chairman and Non- Independent
Directors was carried out by the Independent Directors.
17.2 REMUNERATION POLICY
A. Policy on remuneration to Non-Executive Directors/Independent
Directors
The policy of the Company, based on the recommendation of the
Nomination & Remuneration Committee for the payment of remuneration to
Non-executive Directors/Independent Directors of the company is that
the Non-Executive Directors will be paid only sitting fees for
attending Board and Committees of the Board which is fixed within the
limits of Companies Act, 2013 and as per the Listing Agreement.
B. Policy on remuneration to MD & Executive Director, Key Managerial
Personnel and other employees
The Compensation/Remuneration policy of the Company as approved by the
Board contains the policy for payment of remuneration to Executive
Directors including MD & Key managerial personnel and for the employees
of the Company.
17.3 MEETINGS
During the year Six Board Meetings and One independent directors'
meeting were held. The Details of which are given in Corporate
Governance Report.
17.4 AUDIT COMMITTEE:
i) Terms of reference:
The Audit Committee reviews the audit report submitted by the Internal
Auditors and Statutory Auditors, financial results, effectiveness of
internal audit processes and the Company's risk management strategy. It
reviews the Company's established Systems and the Committee is governed
by a Charter which is in line with the regulatory requirements mandated
by the Companies Act, 2013 and Clause 49 of the Listing Agreement.
ii) Composition :
The Audit Committee of the Company consists of three Independent
Directors. The Chairman of the Audit Committee is financially literate
and majority of them having accounting or related financial management
experience. Representative of Statutory Auditor is permanent invitee.
Company Secretary acts as Secretary to the Committee.
iii) No. of Meetings held during the year :
During the year the Committee had 6 Meetings i.e. 21.04.2014,
14.05.2014 ,30.05.2014, 30.07.2014, 31.10.2014 and 27.01.2015.
iv) Composition, name of Members and attendance during the year:
NO.OF MEETINGS
NAME POSITION HELD ATTENDED
Shri.M.Chinnian Chairman 6 5
Shri.L.M.Ramakrishnan Member 6 5
Shri.B.Ramakrishnan Member 6 4
17.5 NOMINATION AND REMUNERATION COMMITTEE:
i) Terms of reference:
This Committee shall identify the persons, who are qualified to become
Directors of the Company / who may be appointed in Senior Management in
accordance with the criteria laid down, recommend to the Board their
appointment and removal and also shall carry out evaluation of every
director's performance. Committee shall also formulate the criteria for
determining qualifications, positive attributes, Independent of the
Directors and recommend to the Board a Policy, relating to the
remuneration for the Directors, Key Managerial Personnel and other
employees.
ii) Composition:
The Nomination and Remuneration Committee of the Company consists of
one Non-Executive and two Independent Directors including Chairman.
iii) No. of Meetings held during the year:
During the year the Committee had two meetings on 27.01.2015 and
09.03.2015.
iv) Composition, name of Members and attendance during the year:
NO.OF MEETINGS
NAME POSITION HELD ATTENDED
Shri.L.M.Ramakrishnan Chairman 2 2
Shri.S.M.
Venkatachalapathy Member 2 2
Shri.M.Chinnian Member 2 2
i) Terms of reference:
The Committee focuses primarily on monitoring expeditious Redressal of
investors / stakeholders grievances and also functions in an efficient
manner that all issues / concerns stakeholders are addressed / resolved
promptly.
ii) Composition of the Committee:
The Committee consists of one Non-Executive and two Independent
Directors.
iii) No. of meetings held and attended during the year :
During the year the 4 Stakeholders Relationship Committee Meetings were
held i.e. on 21.04.2014, 14.05.2014, 30.07.2014 and 31.10.2014.
The attendance of the Members at the meeting was as under :
NO.OF MEETINGS
NAME POSITION HELD ATTENDED
Shri.PKumarasamy Chairman 4 4
Shri.LM.Ramakrishnan Member 4 3
Shri.M.Chinnian Member 4 3
iv) Name and Designation of Compliance Officer:
Mr. Sekar. P Company Secretary and Compliance Officer. Shareholder's
Services:
Nature of Complaints
S.No. 2014-2015
Received Answered
1st Quarter - - -
2nd Quarter - - -
3rd Quarter - - -
4th Quarter - - -
Location and time for the last two AGMs:
Year Date Venue
N.S.A Mahal, Club Melaange,
2012- 2013 30.09.2013 314,315, Perundurai Road,
Erode - 638 011
N.S.A Mahal, Club Melaange,
2013- 2014 10.09.2014 314,315, Perundurai Road,
Erode - 638 011
Year Time Special Resolution
2012- 2013 No Special Resolution
4.00 P.M. was passed
2013- 2014 Special Resolutions
4.00 P.M. have been passed
18. INDEPENDENT DIRECTORS MEETING:
During the year under review, the Independent Directors of the Company
met on 27.01.2015, inter alia, to discuss:
i) Evaluation of performance of Non- Independent Directors and the
Board of Directors of the Company as a whole.
ii) Evaluation of performance of the Chairman of the Company, taking
into views of Executive and Non-Executive Directors.
iii) Evaluation of the quality, content and timelines of flow of
information between the Management and the Board that is necessary for
the Board to effectively and reasonably perform its duties.
19. DECLARATION BY INDEPENDENT DIRECTOR:
The Company has received necessary declaration from each independent
director under section 149(7) of the Companies Act, 2013 that he meets
the criteria of independence laid down in section 149(6) of the
Companies Act, 2013, and clause 49 of the Listing Agreement. (Refer
Appendix-E).
20. INTERNAL COMPLIANTS COMMITTEE:
Your company has upheld the letter and spirit contained in "The
Sexual Harassment of Women at Workplace (Prevention, prohibition and
Redressal) Act, 2013". (the act). Board of Directors had resolved to
constitute Internal Complaints Committees to function as per the
provisions laid down in the Act and also to support the women employees
by way of counseling.
a. No. of complaints received in the year 2014: NIL
b. No. of complaints disposed of during the year 2014: NIL
c. Nature of action taken by the employer/district officer: NIL
21. MANAGEMENT DISCUSSION AND ANALYSIS:
The Management Discussion and Analysis Report for the year under review
as stipulated under Clause 49 of the Listing Agreement with the stock
exchanges in India is presented in a separate section forming part of
this Annual Report in Appendix-F.
22. DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the
information and explanations obtained by them, your Directors make the
following statements in terms of Section 134(3) (c) of the Companies
Act, 2013:
a) that in the preparation of the annual financial statements for the
year ended March 31, 2015, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
b) that such accounting policies as mentioned in Notes to the Financial
Statements have been selected and applied consistently and judgment and
estimates have been made 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 of the Company for the year ended on that
date;
c) that proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d) that the annual financial statements have been prepared on a going
concern basis;
e) that proper 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.
23. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
24. AUDITORS:
24.1 STATUTORY AUDITORS
M/s. N.C. Rajagopal & Co., Chartered Accountants, Erode (Firm
Registration No.003398S), the present statutory auditors of the company
retires at the ensuing Annual General Meeting and are eligible for
reappointment, and the Company proposes to reappoint M/s. N.C.
Rajagopal & Co., Chartered Accountants as statutory auditors of the
company from the conclusion of the ensuing Annual General Meeting up to
the conclusion of next Annual General Meeting of the Company.
24.2 SECRETARIAL AUDITOR
The Board had in its meeting dated 30th July 2014, appointed Mr. V.
Ramkumar, Company Secretary in Practice, Coimbatore. (CP No.:3832,
Membership No: 11402), to undertake the secretarial audit of the
company for the year ended 31st March 2015, in compliance with the
provisions of Section 204 of the Companies Act, 2013 and The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014,.
24.3 INTERNAL AUDITOR
Mr. R.Muralidharan, B.Com, FCA., Chartered Accountant performs the
duties of internal auditor of the company and their report is reviewed
by the audit committee from time to time.
25. AUDITORS' REPORT:
The Auditors' Report to the members on the Accounts of the Company for
the financial year ended 31st March 2015 does not contain any
qualifications, reservations, or adverse remark..
26. CONSOLIDATED FINANCIAL STATEMENTS:
Pursuant to Section 129 of the Companies Act, 2013, the Company has
prepared a Consolidated Financial Statements of the Company and also of
its Subsidiary, "SKM Europe BV", Utrecht, the Netherlands, in same
form and manner as that of the Company which shall be laid before the
ensuing Annual General Meeting of the Company along with laying of the
Company's Financial Statement under section 129 sub-section (2) i.e.
Standalone Financial Statement of the Company.
27. 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 below:
28. PARTICULARS OF EMPLOYEES:
As required by the provisions of section 197 read with Rule, 5 of The
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, the names and other particulars of the employees who were in the
receipt of remuneration not less than Sixty Lakh Rupees for the
financial year 2014-2015 are set out in the Appendix-G.
29. STOCK EXCHANGE INFORMATION:
The Company's Equity Shares are listed on:
1. BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001
and
2. NSE Limited, "Exchange Plaza", Bandra-Kurla Complex Bandra East,
Mumbai -400 051.
The annual listing fees have been paid to all the Stock Exchanges as
mentioned above..
30. SECRETARIAL AUDIT REPORT:
Secretarial Audit Report in prescribed format MR 3 given by the Company
Secretary In Practice is annexed to the Board Report. (Refer
Appendix-H).
31. INTERNAL CONTROLS:
The Company has a system of internal control which examines both the
financial effectiveness and operational effectiveness to ensure
reliability of financial and operational information and all statutory/
regulatory compliances.
32. INSIDER TRADING CODE:
The Company has formulated a code for prevention of Insider Trading
pursuant to Securities and Exchange Board of India (Insider Trading)
(Amendment) Regulation 2002 to prevent the practices of Insider
Trading. Mr. FI Sekar, Company Secretary has been designated as
Compliance Officer for this purpose. Senior Management of the Company
has affirmed compliance with the Code of Conduct. The Company has duly
complied with all the mandatory listing agreement.
33. INDUSTRIAL RELATIONS:
The industrial relations continued to be generally peaceful and cordial
during the year.
34. CEO/CFO CERTIFICATION:
In terms of Clause 49 (IX) of the Listing Agreement, with the Stock
Exchanges, the Chairman & Managing Director and Chief Financial Officer
of the Company have certified regarding the Financial Statements for
the year ended March 31, 2015 which is annexed to this Report in
Appendix-I.
35. MEANS OF COMMUNICATION:
The quarterly, unaudited and annual audited financial results were
published in nationally circulated newspapers in English, such as,
Business Line and in regionally circulated in Daily Thanthi and
Dhinamalar. The results were also displayed on the Company's website -
www.skmegg.com.
36. GENERAL INFORMATION FOR SHAREHOLDERS
ANNUAL GENERAL MEETING
Date:23.09.2015 Time: 4.00 PM
Venue: NSA Mahal, Club Melaange, 314, 315, Perundurai Road, Erode-638
011
Financial Year: 1st April 2014 to 31st March 2015
Period of Book Closure: 17.09.2015 to 23.09.2015
Dividend Payment Date: 24.09.2015
FINANCIAL CALENDER:
Approval of quarterly results for the period ending:
1.30th June 2014:30th July 2014
2. 30th September 2014: 31st October 2014
3. 31st December 2014: 27" January 2015
4. 31st March 2015: 20th May 2015
37. REGISTRAR AND SHARE TRANSFER AGENT:
S.K.D.C. Consultants Limited Kanapathy Towers,
3rd Floor,
1391/A1, Sathy Road,
Ganapathy, Coimbatore-641 006.
38. COMPLIANCE OFFICER:
Mr. Sekar. P Company Secretary
Address: 185, Chennimalai Road, Erode.
Email: [email protected]
Mob No: 9585558325
39. ACKNOWLEDGEMENTS:
The company has been very well supported from all quarters and
therefore your directors wish to place on record their sincere
appreciation for the support and co-operation received from Employees,
Dealers, Suppliers, Central and State Governments, Bankers and others
associated with the Company. Your Directors wish to thank the banks,
financial institutions, shareholders and business associates for their
continued support and cooperation. We look forward to receiving the
continued patronage from all quarters to become a better and stronger
company.
40. CAUTIONARY STATEMENT:
The statements contained in the Board's Report and Management
Discussion and Analysis contain certain statements relating to the
future and therefore are forward looking within the meaning of
applicable securities, laws and regulations.
Various factors such as economic conditions, changes in government
regulations, tax regime, other statues, market forces and other
associated and incidental factors may however lead to variation in
actual results.
For and on behalf of the Board of Directors
Date: 20.05.2015
Place:Erode Chairman of the Board
DIN: 00002380
Mar 31, 2014
Dear Members,
The directors are pleased to present the 19th ANNUAL REPORT with
audited accounts for the year ended 31st, March 2014. The summarized
financial results of the Company are given hereunder.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
DESCRIPTION 2013-14 2012-13
Total Income 24,043.15 20,038.49
Profit Before Interest, Depreciation and Tax 3,072.16 3,157.51
Less : Financial Cost 835.86 1,175.97
Depreciation & Amortization 1,262.72 1,845.00
Profit Before Tax 973.58 136.54
Less: Provision for Tax
-Current - -
-MAT Credit entitlement - -
-Deferred Tax 292.99 33.09
Profit After Tax and available for appropriation 680.59 103.45
APPROPRIATIONS
Proposed dividend - -
Dividend Distribution Tax - -
Surplus carried to Balance Sheet 680.59 103.45
DIVIDEND
Your directors have not recommended any dividend for the financial
year.
CORPORATE GOVERNANCE
A detailed report on corporate governance together with a certificate
from the Statutory Auditors, in compliance with Clause 49 of the
Listing Agreement, is attached as part of this report. Compliance
reports in respect of all laws applicable to the Company have been
reviewed by the Board of Directors.
MANAGEMENT DISCUSSION ANDANALYSIS REVIEW OF PERFORMANCE
1. The Company recorded revenue of Rs. 24,043.15 lacs (including other
income of Rs.105.56 lacs) for the year ended 31st March,2014 as against
Rs. 20,038.49 lacs (including other income of Rs. 700.36 lacs) in the
previous year ended 31.03.2013.
2. The Profit before tax was at Rs. 973.58 lacs for the year ended 31st
March,2014 as compared to Rs.136.54 lacs during the corresponding in
the last year.
3. The Net Profitwas at Rs.680.59 lacs as on 31.03.2014 as against
Rs.103.45 lacs in the previous year.
4. The quantity sold during the year 2013-14 stood at 6674 MTs, when
compared to 6215 MT during the previous year ended 31st March,2013.
KEY FACTORS WHICH AFFECT THE PERFORMANCE OF THE COMPANY
a. Adverse movement in Egg Powder rates.
b. Volatility in prices of raw materials like egg etc.
CAPITAL EXPENDITURE AND FUNDING
i. The Capital Expenditure incurred and funded for the year is Rs.90.78
lacs of which Rs.71.86 lacs pertain to plant and machinery.
ii. During the year under review, your company has sold/deleted
/adjusted assets worth Rs.1164.57 lacs.
OUTLOOK OF THE INDUSTRY
Low cost of eggs in US, resulting in reduced egg product price by US
resulting in stiff competition on price front especially in Japan and
Europe.
Reduced import duty and NIL duty for certain countries like Japan is
giving us stiff competition
At the same time, reduced restitution announced recently in Europe
has given us a break.
The industry being Egg processing , which is predominantly raw
material intensive sector and hence fluctuation in egg
price widely influence cash position and operating margin of this
sector.
The unprecedented increase in the prices of eggs nearly most part of
the financial year had a substantial adverse effect on the bottom line
of the company forthe current year.
Performance of the previous year was reported to be good and it is a
high record of achieving the turnover of Rs.237.10 crores,
predominantly in view of the fact that higher selling price and
addition of egg yolk liquid resulting in more separation of Egg albumen
powder. Most importantly, increased volume of the egg yolk powder and
whole egg powder in Japanese market and also entered the new market
Nigeria.
Egg processing industries in India do not have any domestic market
for processed eggs and therefore the performance of the company is
having a direct correlation to the performance of the global economy.
Dollar/Euro Vs Indian rupee is comparatively better than the past and
has given considerable increase in price realization.
Overall for the financial year ended 31st March 2014, the company has
evolved strategies in such a way to increase the selling price levels
and volume with the existing buyers. Egg albumen price has increased by
US $ 2.0/kg is a good sign. Developed new products with additives in
the egg liquid enhancing the shelf life, thereby we can export these
egg liquids to other Asian countries. We have captured long term
contract with two countries forthe enhanced shelf life product of egg
liquid with additives. Also, in the process of developing new products
using egg powders. Ready to use egg blends [bakery mix] for both the
export and domestic market for bakery applications.
OTHER RELATED REASONS FORTHE PERFORMANCE OFTHE COMPANYAND INDUSTRY
Demand for the egg powder in the export market expected to improve
substantially.
Recovery in global demand considered as a major growth drive.
High input costs including cost of raw material is a major challenge
faced by the players in the poultry sector during Financial Year
2013-2014.
Registered ourpoultryfarms under compartmentalization /establishment.
The Egg powder sector had suffered a setback due to export
dependence, with the advent of the global economic crisis. At this
backdrop, it is believed to tap other export markets to be the most
important or an important strategic focus in Financial Year 2013-2014.
The company is looking at various options to improve the performance
of the company.
It is focused that demand for the egg powder in the export market
expected to improve substantially in the ensuing years.
The major growth stimulant is the recovery of global demand for end
product.
A major challenge faced by the players in the poultry sector during
the current year is high input costs including cost of raw material.
The most important strategic focus of the company during the current
year would be penetrating the Russian market.
Approval got from the Russian Government. Trial shipment under
process.
The sector in which the company is now focusing has being
encountering setbacks due to export dependence, with the advent of the
global economic crisis.
At this backdrop, it is believed to tap other export markets to be
the most important or an important strategic focus in the coming years.
Indian government incentives helps us a lotto export more sales
volume.
A major shift in the export market segment might be required to
improve price realization and a marked improvement in operational
efficiencies.
FUTURE PROSPECTS
Reckoning with the customers'' awareness improving for the quality
parameters on the one hand and the pricing of the products on
taking place in the supply side on the other hand, the future prospects
of the company is ensured.
Though operating in a competitive environment, the uniqueness of the
model ensures a comfortable level of net margin availability
to your organization.
SALES AND MARKETING
In this highly competitive international markets for egg products, we
SKM Egg Products Export (India) Limited has established a very wide
network in Europe, Far East and South East Asian countries. Since we
are able to maintain good relationship with customers and getting
repeatorders forthe past 18 years, particularly fromthemajormarkets
ofJapan and Europe.
Normally it is very difficult to enter Japan and Europe markets where
USA and European suppliers are delivering at competitive prices. But,
with our management''s high support our marketing and sales team has
successfully established our market share in this high competition
markets and sell our products at competitive prices where quality of
our products is at par with Europe and USA suppliers.
Our recent new product of Egg Liquid is highly acceptable in Europe and
Middle East countries, and successfully penetrating in these markets.
In orderto increase our market share and understand customer
requirements, we are participating in big international food shows and
visiting customers at their place at regularintervals.
Recently we have entered Nigeria and South Africa markets where we
expect the requirement of egg product is good and hope, we will have
long and more business in these regions. We are confident that we will
spread over our sales in Russian market also in the coming year.
SUBSIDIARY COMPANY
The subsidiary helps the company in a big way in identifying new
customers in Europe and improved the confidence level of customers
through timely and qualitative services. The subsidiary is also taking
initiatives to explore into markets which are untapped by the company
till now.
HUMAN RESOURCES
Your Company believes that its greatest assets are its people and
training is an investment in long term people development, for
organizational excellence. During the year under review, your Company
has taken several new initiatives to ensure that the knowledge and
wisdom gained over decades is handed down to the next generation of
employees. A well balanced mix of domain knowledge and behavioral
training was taken up towards talent transformation. These initiatives
have paid good dividends in the form of a strong group of in-house
facilitators of domain knowledge and an inspired team of employees
geared up to serve the needs of your company''s valued customer.
INTERNAL CONTROL SYSTEMS AND INTERNAL AUDIT
The Company maintains adequate internal Control systems and the
Internal Audit is handled by a qualified Chartered Accountant and his
team of subordinates.
DIRECTORS
1. Smt. S. Kumutaavalli (DIN: 00002390), Non executive director
retiring by rotation, being eligible offers herself for reappointment.
2. Shri. FI Kumarasamy (DIN: 00046090), Non executive director retiring
by rotation, being eligible offers himself for reappointment.
3. Shri. Chinnusamy Devarajan (DIN: 00109836) who meetsthe criteria of
Independence as provided under Section 149(6) of the Companies Act,
2013 is appointed as Independent Director.
4. Shri. Marutha Gounder Chinnayan (DIN: 01497482) who meets the
criteria of Independence as provided under Section 149(6) of the
Companies Act, 2013 is appointed as Independent Director.
5. Dr. L.M. Ramakrishnan (DIN: 00001978) who meets the criteria of
Independence as provided under Section 149(6) of the Companies Act,
2013 is appointed as Independent Director.
FIXED DEPOSITS
The Company has not accepted deposits from the public during year under
review.
CEO/CFO CERTIFICATION
In compliance with the requirements of Clause 49 of the listing
agreement entered into with the Stock Exchanges, the Managing
Director has submitted to the Board a certificate relating to financial
statements and other matters as envisaged in the said clause.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors'' Responsibility
Statement, it is hereby confirmed:
i) That in the preparation of the accounts for the financial year ended
March 31, 2014, the applicable accounting standards have generally been
followed exceptfor small deviations as explained in the Notes on
accounts.
ii) That the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
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 of the Company forthe year under review.
iii) That the Directors have taken proper and sufficient care forthe
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
iv) That the Directors have prepared the accounts for the financial
year ended March 31, 2014 on a going concern'' basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the listing agreement a report on corporate
governance is given in the section titled "Report on Corporate
Governance forming part of this Annual Report.
A certified from the Auditors of the Company regarding compliance of
the conditions of corporate governance as stipulated under
Clause 49 of the Listing Agreement entered into with the Stock
Exchanges is attached to this report.
AUDITORS
M/s.N.C.Rajagopal & Co., the present statutory auditors retire at the
ensuing Annual General Meeting and are eligible for reappointment u/s
224(1B) of the Companies Act, 1956. The Company proposes to reappoint
M/s.N.C.Rajagopal & Co., Chartered Accountants as Statutory Auditors of
the company from the conclusion ofthe ensuing Annual General Meeting up
to the conclusion ofthe next Annual General Meeting ofthe Company. In
respect ofthe observations made bythe Auditors in their report, your
Directors wish to state that the respective notes to the accounts read
with relevant accounting policies are self explanatory and therefore do
not call for any further comments.
SECRETARIAL AUDIT
A qualified Practicing Company Secretary carries out a secretarial
audit on a quarterly basis to reconcile the total admitted capital with
National Securities Depository Limited (NSDL) and Central Depository
Services Limited (CDSL) and the total issued and listed capital. The
audit confirms that the total issued/paid up capital is in agreement
with the total number of shares in physical form and the total numberof
dematerialised shares held with NSDL andCDSL.
SHAREHOLDER INITIATIVES
Your company adheres strictly to all the statutory and other legal
compliances. Your Company has been one of the first to implement any
initiatives for shareholder benefit directed from SEBI. On occurrence
of any event, which has a bearing on the share price or otherwise, your
company intimates the stock exchanges, within the stipulated period.
Your company has in place regulations for preventing and regulating
insider trading and has adhered to a code of conduct and business
ethics by which the shareholder is treated at parwith an employee on
availability of information about the company.
Your company has been prompt and regular in its replies to your
queries. Your company also replies within the stipulated time to all
legal and statutory authorities. The total numbers of shares dematted
as on 31st March 2014 are shares which represent of the shares ofthe
Company.
DEVELOPMENTS IN HUMAN RESOURCES/INDUSTRIAL RELATIONS
The Company strives to maintain healthy and harmonious relationships
with all its employees. Efforts better ideas for a better plan are
ongoing to build and renew the relationship with the workforce.
STATUTORY INFORMATION
Name Age Designation Gross Experience
Remuner
-ation
Shri SKM Maeilanandhan Executive
(DIN: 00002380) 69 Chairman 53''82''572 30 years
ShriSKM Shree Shivkumar Managing
(DIN: 00002384) 45 Director 65,/6,85/ 20 years
Date of Previous
Name appointment employment
Shri SKM Maeilanandhan 26,06,96 Chairman & Managing Director
(DIN: 00002380) in SKM Animal Feeds and Foods
(India) Limited
ShriSKM Shree Shivkumar 26 0696 Executive Director in SKM Animal
Feeds and Foods (India) Limited
CORPORATE SOCIAL RESPONSIBILITIES
The Company always places greater importance to manage its affairs with
highest levels of transparency, accountability and integrity and
maintain the high standards of corporate governance on sustained basis.
Your company is committed to the welfare of not only poor citizens but
also to the society at large, the company has been regularly organizing
various continuous social programmes, camps which provides, not only
good care, but also promote awareness to the general public. During the
year, the company conducted such social responsibility camps.
CONSOLIDATED FINANCIAL STATEMENTS
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS _21 issued by the Institute of Chartered Accountants of
India, the Consolidated Financial Statements presentedbyyourcompany
includes thefinancial information ofitssubsidiaryalso.
RELATED PARTY DISCLOSURES
(a) NameoftheRelatedParties
i) SKM Animal Feeds and Foods (India) Limited
ii) SKM Universal Marketing Company India Limited
iii) SKM Maeilanandhan (Executive Chairman) - Key Managerial Person
iv) SKM Shree Shivkumar (Managing Director) - Key Managerial Person
v) SKM Europe BV, Utrecht, The Netherlands
(b) Description of relationship between the parties Presumption
ofsignificance influence.
(c) Transaction details:
i. Sale of Egg Shell waste toSKM Animal Feeds and Foods (India) Limited
Rs.20.88/- Lacs (Tonnage 911.70 Tons)
ii. Details of Loans Borrowed, Repayments and Interest Payments (Rs.in
Lacs)
iv Rent Paid to Managing Director, Rs. 76,500/-
v Lease Rent received from SKM Universal Marketing Co., India Limited
Rs.6 lacs.(Net of VAT and Service Tax) vi. Remuneration Paid to
Executive Chairman and Managing Director : (Rs. in Lacs)
The Executive Chairman and Managing Director''s remuneration is covered
under part II of ScheduleXIII ofthe Companies Act, 1956. vii.
Transaction with the Foreign Subsidiary:
Sales Made (CIF Value) to SKM Europe BV, The Netherlands Rs.1,927/-
Lacs
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the
health care sector''s objectives, projections, estimates and
expectations may constitute forward looking statements within the
meaning of applicable laws and regulations. Actual results might differ
materiallyfrom those either expressed or implied.
ACKNOWLEDGEMENT
The Directors wish to convey their appreciation to the Company''s
employees for the massive personal efforts as well as their collective
contribution to the Company''s record performance. The Directors would
also like to thank the Customers, Shareholders, Bankers, and Suppliers
fortheir continuous support given to the company and their confidence
in the management.
CONSERVATION OF ENERGY
Various energy saving measures are under consideration and the same
would be implemented in the ensuing years. During this year under
review the company has adopted energy saving techniques for improving
power factors. The outcomes of the initiatives taken bythe company is
the improvementin powerfactor.
1. Started using wind energy to a tune of 55% by way of purchasing from
third party.
2. Implemented to changing overto CFL and LED lighting system.
3. Electrical Energy saving Audit done through Kongu Engg college-
Erode.
4. Steam Energy saving Audit done through Forbess Marshall Pune.
5. Started introducing variable speed drive in different areas to save
power.
TECHNOLOGY ABSORPTION
The company is using the technology acquired from BELOVO, Belgium. Over
the years the company''s personnel have acquired thorough knowledge and
make required modification for producing various kind of new products
to meetthe market demands.
RESEARCH AND DEVELOPMENT
Research and Development wing of the company developing an alternate
enzyme for manufacturing Egg yolk powder - Heat stable yolk which
involves process re-engineering and arriving new process parameters.
Also, in the process of changing the feed formulation to arrive the
customers requirement of egg powders with a modified free fatty acid
profile. The company is doing trials in its poultry farm to produce
different quality of eggs by making changes in feed formulation to
meetthe above requirements.
By the order of the Board
Place : Erade SKM Shree Shivkumar
Date : 30.07.2014 Managing Director
Mar 31, 2013
Dear Members,
The directors are pleased to present the 18th ANNUAL REPORT with
audited accounts for the year ended 31st, March 2013. The summarized
financial results of the Company are given hereunder.
FINANCIAL HIGHLIGHTS Rs. in lacs
DESCRIPTION 2012-2013 2011-2012
Total Income 20,038.49 12,434.13
Profit Before Interest, Depreciation and Tax 3,157.51 338.77
Less : Financial Cost 1,175.97 1,152.77
Depreciation & Amortization 1,845.00 900.73
Profit Before Tax 136.54 (1,714.73)
Less: Provision for Tax
-Current 0.00 0.00
-MAT Credit entitlement 0.00 (13.31)
-Deferred Tax 33.09 (539.81)
Profit After Tax and available for appropriation 103.45 (1,161.61)
APPROPRIATIONS
Proposed dividend - -
Dividend Distribution Tax - -
Surplus carried to Balance Sheet 103.45 -
DIVIDEND:
Your directors have not recommended any dividend for the financial year
in view of the meager profit of Rs.103.45 lacs for the year ended 31st
March 2013.
CORPORATE GOVERNANCE
- A detailed report on corporate governance together with a certificate
from the Statutory Auditors, in compliance with Clause 49 of the
Listing Agreement, is attached as part of this report.
- Compliance reports in respect of all laws applicable to the Company
have been reviewed by the Board of Directors.
Management discussion and analysis review of performance:
1) The Company recorded revenue of Rs.20,038.49 lacs (including other
income of Rs.700.37 lacs) for the year ended 31st March,2013 as against
Rs.12434.13 lacs (including other income of (Rs.218.40 lacs)) in the
previous year ended 31st March,2012.
2) The Profit before tax was at Rs.136.54 lacs for the year ended 31st
March,2013 as compared to (Rs.1,714.73 lacs) during the corresponding
period in the last year.
3) The Net Profit was at Rs.103.45 lacs as on 31.03.2013 as against
(Rs.1,161.61 lacs) in the Previous financial year.
4) The quantity sold during the year 2012-13 stood at 6215.269 MTs,
when compared to 4218.625 MT during the previous year ended 31st March,
2012
Key factors which affect the performance of the company :
a. Adverse movement in Egg Powder rates.
b. Volatility in prices of raw materials like egg etc.
Capital expenditure and funding:
i. The Capital Expenditure incurred and funded for the year is Rs.57.80
lacs of which Rs.17.95 lacs pertain to plant and machinery.
ii. During the year under review, your company has sold /deleted
/adjusted assets worth Rs.11.78 lacs.
OUTLOOK OF THE INDUSTRY :
- The revenue from operation for the current year would be more than
the last financial year 2012-13.
- Performance of the previous year was reported to be good and it is a
high record of achieving the turnover of Rs.193.38 crores,
predominantly in view of the fact that higher selling price and
addition of egg yolk liquid resulting in more separation of Egg albumen
powder. Most importantly, increased volume of business in the local
market too with the introduction of pasteurized whole egg liquid.
- The industry being Egg processing, which is predominantly raw
material intensive sector and hence fluctuation in egg price widely
influence cash position and operating margin of this sector.
- The unprecedented increase after the "prices of eggs" nearly most
part of the financial year had a substantial adverse for effect on the
bottom line of the company for the current year.
- Egg processing industries in India do not have any domestic market
for processed eggs and therefore the performance of the company is
having a direct correlation to the performance of the global economy.
Dollar/Euro Vs Indian rupee is comparatively better than the past and
has given the company some marginal increase in price realization.
- Overall for the financial year ended 31st March 2013, the company has
evolved strategies in such a way to increase the selling price levels
and volume with the existing buyers. Egg albumen price has increased by
US
$ 2.0/kg is a good sign. Developed new products with additives in the
egg liquid enhancing the shelf life , thereby we can export these egg
liquids to other Asian countries. We have captured long term contract
with two countries for the enhanced shelf life product of egg liquid
with additives. Also, in the process of developing new products using
egg powders. Ready to use egg blends [bakery mix] for both the export
and domestic market for bakery applications. Egg blends like Scrambled
eggs and Omlette mix planned for the noon meal scheme in the State
Government.
Other related reasons for the performance of the company and industry:
- It is focused that demand for the egg powder in the export market
expected to improve substantially in the ensuing years.
- The major growth stimulant is the recovery of global demand for end
product.
- A major challenge to be faced by the players in the poultry sector
during the current year is high input costs including cost of raw
material.
- The most important strategic focus of the company during the current
year would be penetrating the Russian market .
- Regular and periodical interaction with the officials of the
Government department of both Russia and India to complete the
veterinary certification and approval process for export to Russia.
- The sector in which the company is now focusing has being
encountering setbacks due to export dependence, with the advent of the
global economic crisis.
- At this backdrop, it is believed to tap other export markets to be
the most important or an important strategic focus during the current
year 2013-2014.
- The company is looking at numerous strategies to improve its
performance.
- Indian government subsidy helps us a lot to export more sales volume.
- Egg albumen powder is now eligible for additional subsidy and subsidy
entitlement for egg liquid is an encouraging symptom.
- A major shift in the export market segment might be required to
improve price realization and a marked improvement in operational
efficiencies.
FUTURE PROSPECTS
1. Product quality, cost and timely delivery are the key factors in
the growth of this industry. Factors like increased public spending,
favorable interest rates and general improvement in per capital income
point towards higher demand for processing industry in the future.
2. Reckoning with the customers'' awareness and constantly striving to
improve the quality parameters on the one hand and pricing the products
in the supply side on the other , the future prospects of the company
is ensured.
3. Though operating in a competitive environment, the uniqueness of
the model ensures a comfortable level of net margin availability to
your organization.
SALES AND MARKETING:
The efficiency of the marketing and sales network is a critical success
factor for our Company. Our success lies in the strength of our
relationship with our customers who have been associated with our
Company for a long period. The success of our organization lies with
the rapport we maintain with our customers to whom we are supplying for
the past 15 years. Long term contract and repeat orders given by
company''s customers shows our strength by delivering the quality
product, and the services the company caters to them. Marketing team
regularly participate in food exhibitions and also visit the customers
place at various countries to interact & to find the needs and
requirements based on their end application. Success factor of this can
be attributed to the newly developed egg based blended product for a
particular application in a particular market sector. Recent boon to
our growth came due to the fact of a niche market which the management
of the company tapped based on the efforts put in by developing an
extended shelf life product on egg liquid .
SUBSIDIARY COMPANY:
The subsidiary helps the company in a big way in identifying new
customers in Europe and improved the confidence level of customers
through timely and qualitative services. The subsidiary is also taking
initiatives to explore into markets which are untapped by the company
till now.
LIQUIDATION OF FEED MILL DIVISION:
The feed mill division was started on 04.06.2009 at Ayyempalayam
village at Aravakkurichi Taluk and the capacity of the plant was 200
MT/day as a back ward integration to have continuous flow of feeds to
the chicks of the poultry farm of the company and to reduce cost of
purchase of feeds.
Purpose of the setting up Feed Mill Division:
1. Feed cost constitutes a major component in the cost of producing
eggs and the benefits out of the poultry farm can be improved.
2. The cost of feed ingredients fluctuate widely and the company is
not able to take advantage of the price movements of feed ingredients
which can be achieved by implementing efficient purchasing system and
the company make considerable savings in the feed ingredients and
processing cost.
3. The purpose of extending tracking system from present system upto
feed ingredients state had been carried out so far.
4. Originally the feed mill was constructed based on 12 lacs birds.
But, due to escalation in project cost by 35%, we had implemented
poultry farm for 6 lacs birds only. Whereas our feed mill capacity was
200 MT/day to cater to the needs of 12 lacs birds. Capacity utilized
details for the past years are given below:
Year % of capacity utilized
2009-2010 34.76%
2010-2011 37.12%
2011-2012 50.27%
2012-2013 36.71%
To reduce the huge interest burden of the company, it is necessary to
reduce the huge term loan outstanding of the company. Since the poultry
farm undertaking is continuously earning losses for the past 3 years,
the Board of Directors has decided to dispose of poultry farm
undertaking and feed mill undertaking in order to generate cash profit
in the coming years by way of reduction of cost of finance on term loan
availed from SBI, Erode.
Postal Ballot Compliance :
i. For sale of the poultry farm and feed mill division, the
shareholders of the company have given their approval through postal
ballot of Section 293 (1) (a) of Companies Act, 1956.
ii. The Executive Chairman of the company had announced Postal ballot
result based on the report of Scrutinizer Mr.V.Raviganesh, M Com., B
Ed., FCS, FCMA, Practicing Company Secretary on 29th June 2013 and that
99.31% voted in favour of the resolution to sell the Feed Mill and
Poultry Farm Divisions.
iii. Based on the approval of the shareholders and the recommendation
of Assets Sale Committee, the Board of Directors finally decided to
sell the feed mill division to M/s. Hatsun Agro Products Ltd. having
its Registered Office at Domain, Door No.1/20A, Rajiv Gandhi Salai
(OMR), Karapakkam, Chennai  600 097 who have given highest bid of Rs.8
Crores (Rupees Eight Crores Only) exclusive of all tax , duty, charges
and that the assets are to be sold " As is where is condition".
In view of the closure of term loan availed from State Bank of India,
Commercial Branch, Erode for setting of Feed Mill division, charge Id #
90003142 has been modified accordingly by uploading requisite e form in
MCA Portal pursuant to Section 135 of the Act . The overall credit
limit of the charge holder stood at Rs.108.89 crs as on date of the
report 09.08.2013.
HUMAN RESOURCES:
Your Company believes that its greatest assets are its people and
training is an investment in long term people development, for
organizational excellence. During the year under review, your Company
has taken several new initiatives to ensure that the knowledge and
wisdom gained over decades is handed down to the next generation of
employees. A well balanced mix of domain knowledge and behavioral
training was taken up towards talent transformation. These initiatives
have paid good dividends in the form of a strong group of in-house
facilitators of domain knowledge and an inspired team of employees
geared up to serve the needs of your company''s valued customer.
INTERNAL CONTROL SYSTEMS AND INTERNAL AUDIT:
The company maintains adequate internal control systems and the
internal audit are handled by the qualified Internal Auditor of the
company.
DIRECTORS:
The directors, Shri.P.Kumarasamy, Shri.S.M.Venkatachalapathy and
Shri.M.Chinnayan retiring by rotation in the forthcoming Annual General
Meeting. The retiring directors, being eligible, offer themselves for
re-appointment in terms of Article Nos 87 and 96 of the Articles of
Association of the company. Necessary resolutions are being moved to
seek your approval at the ensuing Annual General Meeting of the
company.
At the ensuing Annual General Meeting, Shri.P.Kumarasamy and
Shri.S.M.Venkatachalapathy and Shri.M.Chinnayan, Directors of the
company, retiring by rotation and being eligible to seeks
re-appointment. Your Board recommends their Directors re-appointment.
FIXED DEPOSITS:
The Company has not accepted deposits from the public during the year
under review.
CEO / CFO CERTIFICATION:
In compliance with the requirements of Clause 49 of the listing
agreement entered into with the Stock Exchanges, the Managing Director
has submitted to the Board a certificate relating to financial
statements and other matters as envisaged in the said clause.
DIRECTORS'' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors'' Responsibility Statement, it
is hereby confirmed:
i) That in the preparation of the accounts for the financial year ended
March 31, 2013, the applicable accounting standards have generally been
followed except for small deviations as explained in the Notes on
accounts.
ii) That the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
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 of the Company for the year under review;
iii) That 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.
iv) That the Directors have prepared the accounts for the financial
year ended March 31, 2013 on a going concern'' basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the listing agreement a report on corporate
governance is given in the section titled "Report on Corporate
Governance" forming part of this Annual Report.
The certificate from the Auditors of the Company regarding compliance
of the conditions of corporate governance as stipulated under Clause 49
of the Listing Agreement entered into with the Stock Exchanges is
attached to this report.
AUDITORS:
M/s.N.C.Rajagopal & Co., the present statutory auditors retire at the
ensuing Annual General Meeting and are eligible for re-appointment u/s
224(1B) of the Companies Act, 1956. The Company proposes to re-appoint
M/s.N.C.Rajagopal & Co., Chartered Accountants as Statutory Auditors of
the company from the conclusion of the ensuing Annual General Meeting
up to the conclusion of the next Annual General Meeting of the Company.
In respect of the observations made by the Auditors in their report,
your Directors wish to state that the respective notes to the accounts
read with relevant Accounting policies are self explanatory and
therefore do not call for any further comments.
Cost audit :
M/s.S.Mahadevan & Co., Cost Auditors, have been appointed for
conducting audit of the cost Accounting records for egg products for
the financial year ended 31st March, 2013. The Cost Audit report
relating to the above product will be filed within the stipulated
period of 180 days from the close of the financial year.
The Company has received a letter from them, stating that the
appointment, if made, will be within the limit prescribed under Section
224(1B) of the Companies Act, 1956
SECRETARIAL AUDIT
A qualified Practicing Company Secretary carries out a secretarial
audit on a yearly basis to reconcile the total admitted capital with
National Securities Depository Limited (NSDL) and Central Depository
Services Limited (CDSL) and the total issued and listed capital. The
audit confirms that the total issued/paid up capital is in agreement
with the total number of shares in physical form and the total number
of dematerialised shares held with NSDL and CDSL.
SHAREHOLDER INITIATIVES
Your company adheres strictly to all the statutory and other legal
compliances. Your Company has been one of the first to implement any
initiatives for shareholder benefit directed from SEBI. On occurrence
of any event, which has a bearing on the share price or otherwise, your
company intimates the stock exchanges, within the stipulated period.
Your company has in place regulations for preventing and regulating
insider trading and has adhered to a code of conduct and business
ethics by which the shareholder is treated at par with an employee on
availability of information about the company.
Your company has been prompt and regular in its replies to your
queries. Your company also replies within the stipulated time to all
legal and statutory authorities. The total numbers of shares dematted
as on 31st March 2013 are shares which represent of the shares of the
Company.
DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS
The Company strives to maintain healthy and harmonious relationships
with all its employees. Efforts better ideas for a better plan are
ongoing to build and renew the relationship with the workforce.
CONSERVATION OF ENERGY
The company continuously to puts its effort to adopt various energy
saving measures for conservation of energy even though it is not a
power intensive industry.
1) Started using wind energy to a tune of 50% by way of purchase.
2) Started changing over to CFL Lighting system.
3) Started introducing variable speed drive in different areas to save
power.
CORPORATE SOCIAL RESPONSIBILITIES
The Company always places greater importance to manage its affairs with
highest levels of transparency, accountability and integrity and
maintain the high standards of corporate governance on sustained basis.
Your company is committed to the welfare of not only poor citizens but
also to the society at large. The company has been regularly organizing
various continuous social programmes, camps which provides, not only
good care, but also promote awareness to the general public. During the
year, the company conducted such social responsibility camps.
CONSOLIDATED FINANCIAL STATEMENTS
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS 21 issued by the Institute of Chartered Accountants of
India, the Consolidated Financial Statements presented by your company
includes the financial information of its subsidiary also.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the
health care sector''s objectives, projections, estimates and
expectations may constitute "forward looking statements" within the
meaning of applicable laws and regulations. Actual results might differ
materially from those either expressed or implied.
ACKNOWLEDGEMENT
The Directors wish to convey their appreciation to the Company''s
employees for the massive personal efforts as well as their collective
contribution to the Company''s record performance. The Directors would
also like to thank the Customers, Shareholders, Bankers, and Suppliers
for their continuous support given to the company and their confidence
in the management.
By order of the Board
Place : Erode
Date : 09.08.2013
SKM Shree Shivkumar
Managing Director
Mar 31, 2012
The directors are pleased to present the 17th ANNUAL REPORT with
audited accounts for the year ended 31st, March 2012. Thç summarized
financial results of the Company are given hereunder.
FINANCIAL HIGHLIGHTS
Rs. in lacs
DESCRIPTION 2011-2012 2010-2011
Total Income 12434.13 12110.85
Profit before interest, Depreciation and Tax 338.77 387.25
Less: Financial Cost 1152.77 847.52
Depreciation & Amortization 900.73 860.70
Profit before tax (1714.73) (1320.97)
Less: Provision for Tax - -
-Current - -
-Mat Credit Entitlement (13.31) -
-Deferred Tax (539.81) (388.44)
Profit after Tax and available for
appropriation (1161.61) (932.53)
APPROPRIATIONS
Proposed Dividend
Dividend Distribution Tax
Surplus carried to Balance sheet
DIVIDEND:
Your directors have not recommended any dividend for the financial year
in view of the loss incurred to the tune of (Rs.1161.61) lacs for the
year ended 31st March 2012.
CORPORATE GOVERNANCE
- A detailed report on corporate governance together with a certificate
from the Statutory Auditors, in compliance with Clause 49 of the
Listing Agreement, is attached as part of this report.
- Compliance reports in respect of all laws applicable to the Company
have been reviewed by the Board of Directors
DIRECTORS:
The directors, Dr. L. M. Ramakrishnan and Smt. S. Kumutaavalli retire
by rotation in the forthcoming Annual General Meeting. The retiring
directors, being eligible, offer themselves for re-appointment in terms
of Article Nos 87 and 96 of the Articles of Association of the company.
Necessary resolutions are being moved to seek your approval at the
ensuing Annual General Meeting of the company.
At the ensuing Annual General Meeting, Dr L M Ramakrishnan and Smt S
Kumutaavalli, Directors of the company, retires by rotation and being
eligible seeks re-appointment. Your Board recommends their
re-appointment.
1. The Sri C. Devarajan B.E. a leading industrialist of this region
and one of the pioneer of well known URC Group with a two and half
decades of experience in the civil engineering industry, education,
software, has been co-opted on the board of the company as an
additional director on 6'" August 2012 u/s. 260 of the Companies Act,
1956, with a view to avail of his rich experiernce for the development
and growth of the company.
2. Your Directors wish to state that his appointed would be in the
category as an Independent director and with his appointment the total
strength of the board becomes 9 and the No. of Independent director
stands at 4. Necessary revolutions is being moved at the ensuing AGM to
seek your approval to appoint him as Director by complying provision to
section 257 of the Act.
FIXED DEPOSITS:
The Company has not accepted deposits from the public during year under
review.
CEO / CFO CERTIFICATION:
In compliance with the requirements of Clause 49 of the listing
agreement entered into with the Stock Exchanges, the Managing Director
has submitted to the Board a certificate relating to financial
statements and other matters as envisaged in the said clause.
DELISTING OF COMPANY'S EQUITY SHARES:
The Equity Shares of the company is proposed to be delisted from the
Bombay Stock Exchange Limited as there is no or negligible trading in
the Company's Equity Shares in these Stock Exchanges. After delisting,
if this proposal is approved by the members in the Annual General
Meeting, the Equity Shares of the company will be continued to be
listed in the National Stock Exchange of India Limited.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to the Directors' Responsibility Statement, it
is hereby confirmed:
i) That in the preparation of the accounts for the financial year ended
March 31, 2012, the applicable accounting standards have generally been
followed except for small deviations as explained in the Notes on
accounts.
ii) That the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
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 of the Company for the year under review;
iii) That 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.
iv) That the Directors have prepared the accounts for the financial
year ended March 31, 2012 on a going concern' basis.
CORPORATE GOVERNANCE:
Your company reaffirms its commitment to the good corporate governance
practices pursuant to Clause 49 of the Listing Agreement with- the
Stock Exchanges. Corporate Governance Report is annexed to Directors'
Report and Auditors' Certificate regarding compliance of the Corporate
Governance is made a part of this Annual Report. The Certificate from
the Auditors of the Company, M/s.N.C.Rajagopal & Co confirming
compliance of conditions of Corporate Governance stipulated in Clause
49 of the Listing Agreement is annexed to the Report on Corporate
Governance.
AUDITORS:
M/s.N.C.Rajagopal & Co., the present statutory auditors retire at the
enduing Annual General Meeting and are eligible for reappointment u/s
224(1 B) of the Companies Act, 1956. The Company proposes to reappoint
M/s.N.C.Rajagopal & Co., Chartered Accountants as Statutory Auditors of
the company from the conclusion of the ensuing Annual General Meeting
up to the conclusion of the next Annual General Meeting of the Company.
In respect of the observations made by the Auditors in their report,
your Directors wish to state that the respective notes to the accounts
read with relevant Accounting policies are self explanatory and
therefore do not call for any further comments.
SECRETARIAL AUDIT:
A qualified Practicing Company Secretary carries out a secretarial
audit on a yearly basis to reconcile the total admitted capital with
National Securities Depository Limited (NSDL) and Central Depository
Services Limited (CDSL) and the total issued and listed capital. The
audit confirms that the total issued/paid up capital is in agreement
with the total number of shares in physical form and the total number
of dematerialized shares held with NSDL and CDSL.
SHAREHOLDER INITIATIVES :
Your company adheres strictly to all the statutory and other legal
compliances. Your Company has been one of the first to implement any
initiatives for shareholder benefit directed from SEBI. On occurrence
of any event, which has a bearing on the share price or otherwise, your
company intimates the stock exchanges, within the stipulated period.
Your company has in place regulations for preventing and regulating
insider trading and has adhered to a code of conduct and business
ethics by which the shareholder is treated at par with an employee on
availability of information about the company.
Your company has been prompt and regular in its replies to your
queries. Your company also replies within the stipulated time to all
legal and statutory authorities. The total numbers of shares dematted
as on 31s' March 2012 are shares which represent of the shares of the
Company.
DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS
The Company strives to maintain healthy and harmonious relationships
with all its employees. Efforts better ideas for a better plan are
ongoing to build and renew the relationship with the workforce.
CONSERVATION OF ENERGY
The company continuously to puts its effort to adopt various energy
saving measures for conservation of energy likes even though it is not
a power intensive industry.
1) Started using wind energy to a tune of 55% by way of purchasing from
third party
2) Started changing over to CFL Lighting system
3) Started introducing variable speed drive in different areas to save
power
STATUTORY INFORMATION
Particulars of employee's remuneration u/s 217 (2A) of the Companies
Act. 1956.
NAME AGE DESIGNATION GROSS QUALIFI-
REMUNE- CATION
RATION (Rs)
Shri.SKM. 69 Executive 29,90,110 S.S.L.C.
Maeilanandhan Chairman
NAME EXPERI- DATE OF PREVIOUS
ENCE EMPLOYMENT EMPLOYMENT
Shri S K M
Maeilanandhan 29 Years 26.06.96 Managing Director, SKM
Animal Feeds and Foods
(India) Ltd.,
CORPORATE SOCIAL OBJECTIVES
Corporate Social Responsibility continues to assume an important role
in the activities of the Company. Afforestation, Water Management,
Waste water recycling, Literacy and Health continue to be the chosen
areas of work by the Company and its employees.
ACKNOWLEDGEMENT
The Directors wish to convey their appreciation to the Company's
employees for the massive personal efforts as well as their collective
contribution to the Company's record performance. The Directors would
also like to thank the Customers, Shareholders, Bankers, and Suppliers
for their continuous support given to the company and their confidence
in the management.
By order of the Board
Place : Erode
Date : 06.08.2012 SKM Shree Shivkumar
Managing Director
Mar 31, 2010
The directors are pleased to present the FIFTEENTH ANNUAL REPORT and
the audited accounts of the company for the year ended March 31, 2010.
FINANCIAL HIGHLIGHTS Rs. in lacs
DESCRIPTION 2009-2010 2008-2009
Net Sales 11361.34 12222.21
Profit Before Interest and
Depreciation 1373.30 2153.42
Less : Interest 811.84 540.33
Depreciation 531.89 418.09
Profit before tax 29.57 1194.99
Add: Earlier Year Mat Provision
credit entitlement 239.25 -
Less: Provision for Deferred Tax 174.30 550.83
Profit after tax and available
for appropriation 94.51 644.16
APPROPRIATIONS:
Proposed dividend 0 131.65
Corporate dividend tax 0 22.37
Balance carried to Balance Sheet 94.51 490.13
DIVIDEND :
Since the company has earned a meager net profit of Rs.94.51 lakhs, the
Board has not recommended the dividend during the year 2009-10.
REVIEW OF PERFORMANCE
Your directors wish to state that during the year recorded a turnover
of Rs.113.62 crores as against Rs. 122.22 crores in the previous ended
31st March 2009.The profit before tax has gone down to Rs.0.30 crores,
compared to Rs.11.95 crores during the corresponding previous year .PAT
stood at Rs. 0.95 crores as on 31.03.2010 as against Rs. 6.44 crores in
the previous fiscal.
During the current year under review, the average egg price stood at
Rs.2.28/egg when compared to Rs.1.92/egg during the previous year ended
31st March, 2009. The average realization of egg powder had also shown
decline from Rs 316.23/kg during the corresponding previous year
2008-09 to Rs.258.70/kg during the current year under review. Despite
worldwide recession, the quantity sold during the current year stood at
4391.67 MT, when compared to 3865.01 MT during the previous year. The
Interest & Finance charges increased to Rs.8.12 crores due to expansion
of Feed Mill and Egg Powder unit and increase in average borrowings.
CAPITAL EXPENDITURE AND FUNDING
The Capital Expenditure incurred and funded for the year is Rs.4573.10
lakhs of which Rs.1096.70 lakhs pertain to plant and machinery.
INDUSTRY OVERVIEW
The steep recession continuing in the countries where the company is
predominantly exporting its products, is restricting the increase in
sales volume and reducing the price realization. Therefore, the sales
outlook for the year 2010-2011 will remain the same as that of the
previous year. The shell egg price in Europe is low and there is no
increasing trend, as expected. But the egg prices in US after the
financial crisis has fall in drastically. Hence due to low cost eggs in
US, we are facing stiff competition on price front in Japan and Europe.
In order to sustain our volume of business, our company has also
reduced the selling price. However, there are signs of recovery of
shell egg price in the future. The company is evolving strategies, in
such a way, to retain at least the present price levels and volume.
Because of this, the margin continues to be under pressure, as we do
not want to lose the customers. The customers are happy with our
quality and strict adherence to time schedule.
Egg processing industry is a raw material intensive industry and hence
fluctuation is egg price widely influences cash position and operating
margin of this industry. The egg price was ruling at high throughout
the year and this factor had a substantial adverse effect on the bottom
line of the company for this year also. Indian egg processing
industries do not have any domestic market for processed eggs and
therefore the performance of the company is having a direct correlation
to the performance of the global economy, The slow down in the
performance of the US economy resulted in appreciation of Indian Rupee
against US dollar and as a consequence the operating profit of the
company during this year was lower as against the previous year.
The company has been working very hard on value added products to get a
premium prices from the market price. The company has identified Russia
as an important destination for Egg yolk powder. It is in the process
of establishing the branch office in Moscow.
With our standing experience in overseas for over years, we had
indentified few sources who will be able to help us in our operations
at Russia. We believe that our direct contact with end users will give
us better realization and relationship. We plan to make use of
different agents in Russia to service our customers and pay a
commission to them on the business provided by them. With our
experience in Europe Union and other markets, we are confident of
establishing a market share in Russia, taking advantage of better
unilateral relationship our Country had developed over these years.
During the recent visits, we have started opening dialogue with the
prosperous buyers there and we have received encourage response. Our
credibility can be easily established with the fact that our products
exported to Europe are further value added and exported to Russia. The
biggest step now is to further value add our product to suit the
Russian Market, which needs a lot of time and effort technically and
commercially. These measures are absolutely required, if we want to
retain our position in the overseas market. We are confident that our
efforts will bear results in about a year or so.
We are also closely monitoring the political situation in that country
and the payment terms of the customers also. Since the market is
booming and the realization is better than any other overseas country,
we are serious about this market. As the entire situation is in a fluid
state, we will be able to firm up our assumptions with solid figures
over a period of time.
In addition to our efforts in Russia, our exclusive offices SKM Europe
and SKM Japan are continuously working to expand our market with better
realization.
We are confident of increasing our volume and realization in the coming
years with the help of the economic recovery in the US and the EU.
POULTRY PROJECT:
We are taking about 450000 eggs from our farm on daily basis. It is
expected that this project would make a significant contribution to the
bottom line of the company in the ensuing years. In addition to the
monetary benefits, this project will enable the companys tracking
system to extent upto the stage of feed ingredients level. The
advantage of poultry farm is that we can purchase good quality
salmonella free chicks from known source which is pre requisite for
food safety. The company has a very good bio security control in our
premises and strict monitoring of health of birds. We can also produce
good quality residue free eggs by giving good quality feed & water to
birds. Traceability is much easier in our own production.
Poultry, in fact, is one of the fastest growing segments of the
Agricultural sector in India. A significant feature of Indias poultry
has been its transformation from a backward activity into a major
commercial activity in just four decades. This transformation has
evolved sizable private sector investments in breeding, hatching,
rearing and processing.
Particularly the investments in Layer farming is expected to be much
better and we can visualize it at the rate of 7.5% increase every year
and this increase is directly proportional to the population and the
per capita consumption. National Eggs Coordination Committee has
already projected a poultry plan for the year 2015 based on the target
of achieving 180 eggs as per capita consumption. This will have a
thrust on developing the rural consumption which is the focal point at
the pace of 20% per annum.
The Indian Egg price has been historically very close to the American
prices of around 0.4 Euro per Kg. but from 2006-07 onwards it has
gradually increased to 0.55 Euro per Kg. in 2008-09. In the last year
the egg prices are dramatically increased to reach a level of 0.75 Euro
per Kg.
FEED MILL :
The company started production on 04/06/09 and the capacity of the
plant is 200 mt/day. Feed cost constitutes a major component in the
cost of producing eggs and the benefits out of the poultry farm can be
improved. Also the cost of feed ingredients fluctuate widely and the
company is not able to take advantage of the price movements of feed
ingredients which can be achieved by implementing efficient purchasing
system and the company hopes that it would make a considerable savings
in the feed ingredients and processing cost. In addition the company is
receiving enquiries for supply of various kinds of egg powders which
can be possible if eggs are produced in the farm by changing feed
composition mix on trial basis. The purpose of extending its tracking
system from present system up to feed ingredients stage is possible. In
view of the reasons cited, the company established a feed mill at
Ayyempalayam village at Aravakkurichi Taluk, Karur District.
For utilizing the maximum capacity from the present level, we have
adopted a new strategy by which the feed mill is given for lease to the
prospective customers, for use of specific hours only, without
compromising use for our own consumption, which will improve the
revenue generation of the company in the long run. We have got offers
from local farmers and other sources also.
SUBSIDIARY COMPANY :
During this year under review the companys marketing subsidiary SKM
Europe BV, Netherlands earned a profit of Rs. 2.31 lakhs. The
subsidiary helps the company in a big way in identifying new customers
in Europe and improved the confidence level of customers through timely
and qualitative services. The subsidiary is also taking initiatives to
explore into markets which are untapped by the company till now. The
Annual Accounts of the subsidiary company for the financial year under
review are attached with this report.
HUMAN RESOURCES :
Your company continues to lay great stress on its most valuable
resources à people. Continuous training, both on the job and in an
academic setting, is a critical input to ensure that employees at all
levels are fully equipped to deliver a wide variety of products and
services to the rapidly growing customer base of your company. In spite
of the difficult business environment, your company has undertaken a
number of training initiatives during the year and a special enabling
programme on à Born to Win à was organized during the year. The
department heads & Section heads and the official second in position of
every department were given opportunity to undergo this programme. This
programme has given much emphasize on achieving Companys goal through
individuals growth. It also gave the employees an immense opportunity
to mingle with other department heads for better understanding their
roles for the growth of the Company.
INTERNAL AUDIT :
As part of the effort to evaluate the effectiveness of the internal
control systems, your company has set up internal audit department
which would review all the control measures on a periodic basis and
commends improvements, wherever appropriate. The internal audit
department would report directly to Audit Committee of the Board. The
Audit Committee regularly review the audit findings as well as the
adequacy and effectiveness of the internal control measures.
Additionally, your company has proposal to avail information assurance
services from independent professionals. Based on their
recommendations, your company would implement control measures both in
operational and accounting related areas, apart from security related
measures.
DIRECTORS :
The directors, Dr.L.M.Ramakrishnan and Sri.P.Kumarasamy retire by
rotation in the forthcoming Annual General Meeting. The retiring
directors, being eligible, offer themselves for re-appointment.
Necessary resolutions are being moved to seek your approval at the
ensuing Annual General Meeting of the company.
FIXED DEPOSITS :
The company has not accepted deposits from the public during year under
review.
CEO / CFO CERTIFICATION :
In compliance with the requirements of Clause 49,(V) of the listing
agreement entered into with the Stock Exchanges, the Managing Director
has submitted to the Board a certificate relating to financial
statements and other matters as envisaged in the said clause.
DELISTING OF COMPANYS EQUITY SHARES :
The status of delisting the equity shares of the company remains the
same on the strength of the decision taken by the share holders at the
Eleventh Annual General Meeting of the company from the Madras Stock
Exchange Limited and from Coimbatore Stock Exchange Limited remain same
and unchanged. The request of the Madras Stock Exchange to continue
listing of the companys equity shares with it was turndown by the
company and their confirmation is yet to be received. However, no
response received from the Coimbatore Stock Exchange on the decision of
the members to delist its equity shares from their exchange.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors
confirm that:
1. In the preparation of Annual Accounts the applicable Accounting
Standards have been followed and there were no material departures;
2. The Accounting policies selected are being applied consistently and
judgements and estimates made are reasonable and prudent and gives a
true and fair view of the state of affairs of the Company at the end of
the financial year ended 31st March 2010 and of the Profit and Loss of
the Company for that period;
3. Proper and sufficient care had been taken for the maintenance of
adequate Accounting Records in accordance with provisions of the Act
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
4. The Annual Accounts prepared on a going concern basis;
CORPORATE GOVERNANCE:
Your company reaffirms its commitment to the good corporate governance
practices. Pursuant to Clause 49 of the Listing Agreement with the
Stock Exchanges, Corporate Governance Report is annexed to Directors
Report and Auditors Certificate regarding compliance of the Corporate
Governance is made a part of this Annual Report. The Certificate from
the Auditors of the Company, M/s.N.C.Rajagopal & Co, confirming
compliance of conditions of Corporate Governance stipulated in Clause
49 of the Listing Agreement is annexed to the Report on Corporate
Governance.
AUDITORS:
The Statutory Auditors, M/s.N.C.Rajagopal & Co, Chartered Accountants,
holds office until the conclusion of the ensuing Annual General Meeting
and are eligible for reappointment. The retiring auditors
M/s.N.C.Rajagopal & Co, Chartered Accountants informed the Company that
their reappointment, if made, would be within the prescribed limits
under Section 224(1B) of the Companies Act, 1956 and they offer
themselves for reappointment.
SECRETARIAL AUDIT :
A qualified Practicing Company Secretary carries out a secretarial
audit on a yearly basis to reconcile the total admitted capital with
National Securities Depository Limited (NSDL) and Central Depository
Services Limited (CDSL) and the total issued and listed capital. The
audit confirms that the total issued/paid up capital is in agreement
with the total number of shares in physical form and the total number
of dematerialized shares held with NSDL and CDSL.
SHAREHOLDER INITIATIVES :
Your company adheres strictly to all the statutory and other legal
compliances. Your Company has been one of the first to implement any
initiatives for shareholder benefit directed from SEBI. On occurrence
of any event, which has a bearing on the share price or otherwise, your
company intimates the stock exchanges, within the stipulated period.
Your company has in place regulations for preventing and regulating
insider trading and has adhered to a code of conduct and business
ethics by which the shareholder is treated at par with an employee on
availability of information about the company.
Your company has been prompt and regular in its replies to your
queries. Your company also replies within the stipulated time to all
legal and statutory authorities. The total numbers of shares dematted
as on 31st March 2010 are Shares which represent 77.87% of the shares
of the Company.
DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS :
The Company strives to maintain healthy and harmonious relationships
with all its employees. Efforts better ideas for a better plan are
ongoing to build and renew the relationship with the workforce.
CONSERVATION OF ENERGY :
The company continues to put its effort to adopt various energy saving
measures for conservation of energy even though it is not a power
intensive industry.
STATUTORY INFORMATION :
Particulars of employees remunneration u/s 217 (2A) of the Companies
Act.1956.
NAME AGE DESIG- GROSS QUALIFI-
REMUNE- CATION
NATION RATION
( Rs)
Shri.SKM. 66 Executive 33,64,001 S.S.L.C.
Maeilanandhan Chairman
EXPERI- DATE OF PREVIOUS
NANE ENCE EMPLOY- EMPLOYMENT
IN YEARS MENT
Shri.SKM. Maeilanandhan 24 Years 26.06.96 Managing
Director,
SKM Animal
Feeds and
Foods (India)
Ltd.,
The information required as per Section 217(1) (e) of the Companies
Act, 1956 read with Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988 is given in the Annexure forming
part of this report.
As required by Section 212 of the Companies Act, 1956, a statement
showing the Companys interest in the subsidiary is enclosed to the
Balance Sheet of the Company.
CORPORATE SOCIAL OBJECTIVES
Corporate Social Responsibility continues to assume an important role
in the activities of the Company. Afforestation, Water Management,
Waste water recycling, Literacy and Health continue to be the chosen
areas of work by the Company and its employees.
ACKNOWLEDGEMENT:
Your Directors wish to express their appreciation of the continued
co-operation of the Central and State Governments, bankers, customers,
agents and suppliers and also the valuable assistance and advice
received from shareholders. The Directors also wish to thank all the
employees for their contribution, support and continued co-operation
throughout the year.
By order of the Board
Place : Erode
SKM. MAEILANANDHAN
Date : 30.07.2010 EXECUTIVE CHAIRMAN