Directors Report of Mahindra EPC Irrigation Ltd.
Mar 31, 2018
The Directors are pleased to present the 36th Annual Report on business and operations of your Company alongwith the audited financial statements and accounts for the year ended 31st March, 2018.
FINANCIAL HIGHLIGHTS
Highlights for the financial year are as under:
(Rs. in lakhs)
|
For the Year ended 31st March, 2018 |
For the Year ended 31st March, 2017* |
|
|
Revenue from Operations |
20480.67 |
20146.48 |
|
Other Income |
179.35 |
158.94 |
|
Total Income |
20660.02 |
20305.42 |
|
Profit Before Interest, Depreciation & Tax |
1400.44 |
1,425.57 |
|
Finance Cost |
50.11 |
152.89 |
|
Depreciation |
313.94 |
304.78 |
|
Profit Before Tax |
1036.39 |
967.90 |
|
Tax expense |
542.53 |
(22.57) |
|
Profit After Tax |
493.86 |
990.47 |
|
Other Comprehensive Income/ (loss) for the year |
0.71 |
(2.21) |
|
Profit for the year attributable to owners of the Company |
494.57 |
988.26 |
* Figures have been regrouped as per Indian Accounting Standards (IND AS).
Operations and Financial Overview
During the year under review, your Companyâs turnover was at Rs. 204.81 crore as compared to Rs. 201.46 crore for the previous year.
The Company made a Profit Before Tax of Rs. 10.37 Crore for the year 2017-18 as compared to Rs. 9.68 Crores in the previous year. The Profit After Tax was at Rs. 4.94 crore vs. Rs. 9.88 crore in the previous year.
The year under review saw countrywide implementation of Goods and Services Tax (GST). This is a welcome reform that was introduced by the Central Government. Though it impacted your Companyâs performance in the immediate months after introduction, the impact was mitigated due to implementation of core strategies and acceleration of business in project markets in the remaining months, coupled with improved operational efficiencies.
Indian economy continued to grow at a strong pace and is expected to show an improvement over the previous year. It is expected that the economy will grow at 7.2% in 2017-18, slightly higher than 7.1% in the previous financial year. As mentioned earlier, the long awaited GST Act was finally implemented successfully. Consumer spending got a temporary shock upon its implementation. It also impacted the Companyâs quarter wise performance. However, as the year progressed, demand recovered and achieved normalcy by 4th quarter. In this economic scenario, your Company delivered a marginal growth in revenue and Operating Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA).
A detailed analysis of the financial results is given in the Management Discussion and Analysis Report which forms part of this report.
Dividend
Your Directors are pleased to recommend a maiden dividend of 5% i.e. Rs. 0.50 per equity share of Rs. 10 each for the year ended on 31st March, 2018 after 22 years. The dividend, if approved by the members, would involve a cash outflow of Rs. 1.67 crores (inclusive of tax on dividend).
Corporate Governance & Management Discussion and Analysis Report
Your Company believes that sound practices of good Corporate Governance. Transparency, Accountability, and Responsibility are the fundamental guiding principles for all decisions, transactions, and policy matters of the Company. A Report on Corporate Governance, alongwith a certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of this Annual Report.
Further, the Management Discussion and Analysis Report for the year under review, as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, is given in Annexure I to this Report.
Stock Options
The Nomination and Remuneration Committee of the Board of Directors of the Company, inter alia, administers and monitors the Employees Stock Option Scheme of the Company. The Stock Option Scheme, 2014 is in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and there have been no material changes in the said scheme during the year under review.
During the year under review 37,389 nos. of Stock Options got vested under the Employees Stock Option Scheme -2014, and were exercised immediately after vesting. Accordingly, the Company made the allotment of 37,389 Equity Shares.
The Nomination and Remuneration Committee of the Board of Directors further granted 11,129 Stock Options during the year under review, comprising about 0.04% of the current paid up capital.
The applicable disclosures as stipulated under the SEBI Guidelines as on March 31, 2018 (cumulative position) with regard to the Employeesâ Stock Option Scheme (ESOS) are provided in Annexure II to this Report.
Voting rights on the shares issued to employees under the ESOS are either exercised by them directly or through their appointed proxy.
Share Capital
During the year, with the allotment of 37,389 equity shares on exercising of Stock Options by employees, the total paid up equity share capital of the Company increased from 2,76,72,561 equity shares of Rs. 10/- each to 2,77,09,950 equity shares of Rs. 10/- each. The said equity shares have been listed on the Bombay Stock Exchange Limited and they rank pari passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs. 27,70,99,500 divided into equity shares of Rs. 10 each as on 31st March, 2018.
Holding Company
The promoters of the Company i.e. Mahindra and Mahindra Limited (M & M) hold 1,51,44,433 equity shares which represents 54.65 percent of the total paid up capital of the Company. Your Company continues to be a subsidiary company of M & M. The Company does not have any subsidiary company.
Contracts and arrangements with Related Parties
During the financial year, all contracts/arrangements/ transactions entered by the Company with related parties were in the ordinary course of business and on an armâs length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.
All related party transactions are placed before the Audit Committee for approval, wherever applicable. Prior omnibus approval is also obtained from the Audit Committee for the related party transactions which are of repetitive nature as well as the transactions which cannot be foreseen and accordingly, the required disclosures are made to the Committee on quarterly basis for approval of the Committee.
The Companyâs major related party transactions are generally with its holding and associate companies. The related party transactions are entered into based on considerations of various business exigencies, such as synergy in operations, sales transactions through tenders or otherwise. All related party transactions are negotiated on an arms-length basis, and are intended to promote the Companyâs interests.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at the link: http://www.epcmahindra.com/pdf/EPC_Policy_on_Related Party_ Transactions.pdf. The related party transactions have been set out in the Note No. 31 to the financial statement.
Risk Management
The Company has constituted a Risk Management Committee comprising Mr. Nikhilesh Panchal, Mr. Ashok Sharma and Mr. Anand Daga. Mr. Nikhilesh Panchal is the Chairman of this Committee. The Company has adopted the Risk Management Policy. The Committee is entrusted with the responsibility to assist the Board in (a) overseeing and approving the Companyâs enterprise wide risk management framework; and (b) overseeing that all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed.
There is an adequate mechanism in place about risks and uncertainties that can impact itsability to achieve its strategic objectives, risk assessment, risk mitigation and minimization procedures and its periodical review.
Industrial relations
Employees at all levels have contributed to the performance of your Company. Your Directors place on record the cooperation of employees during the year under report. The Directors also place on record the unstinted cooperation extended by the staff members during the period under review.
The Management Discussion and Analysis Report gives an overview of the developments in Human Resources / Industrial Relations during the year.
Safety, Health and Environmental Performance
Your Companyâs commitment towards safety, health and environment is being continuously enhanced and your Company encourages involvement of all its employees in activities related to safety, including promotion of safety standards. This is also demonstrated by the fact that there has been no single incidence of accident for the last 1260 days.
The Safety Committee, constituted for the same, regularly reviews the adherence of safety norms. Some of the programs undertaken by the Company include behaviour based safety training, Knowledge based fire extinguisher training, fire fighting training and Safety awareness, etc.
Various health checkup programs for employees were regularly undertaken by the Company during the year.
Requirements relating to various environmental legislations and environment protection have been duly complied by your Company.
Directors and Key Managerial Personnel
a) Key Managerial Personnel (KMP)
In accordance with the provisions of Section 203 of the Act, the following persons have been designated as KMP of the Company as at 31st March, 2018:
|
Name of the KMP |
Designation |
|
Mr. Ashok Sharma |
Managing Director |
|
Mr. Sanjeev Mohoni |
Chief Executive Officer (CEO) |
|
Ms. Sunetra Ganesan |
Chief Financial Officer (CFO) |
|
Mr. Ratnakar Nawghare |
Company Secretary (CS) |
b) Directors
Pursuant to the provisions of Section 149 of the Companies Act, 2013, the Non independent Director Ms. Sangeeta Prasad would retire and, being eligible, has offered herself for reappointment.
The Company has received declarations from all the Independent Directors of the Company under Section 149(7) of the Act confirming that they meet the criteria of independence as laid down - in Section 149 (6) of the Companies Act, 2013.
The information required pursuant to Section 197(12) read with Rule 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of ratio of remuneration of a director to the median remuneration of the employees of the Company for the financial year is given in the Annexure III to this Report.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors, which includes criteria for performance evaluation of the non-executive directors and executive director. The statement indicating the manner in which formal annual evaluation of the Directors, the Board and Board level committees is given in detail in the Report on Corporate Governance, which forms part of this Annual Report.
The Company had on the basis of the Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors, followed a process of evaluation by the Board for its own performance and that of its Committees and individual Directors.
The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company. During the year, the Independent Directors of the Company met on 27th April, 2017.
The following policies of the Company are attached herewith marked as Annexure IV and Annexure V:
a) Policy on Appointment of Directors and Senior Management and Succession Planning for Orderly Succession to the Board and the Senior Management.
b) Policy for Remuneration of the Directors, Key Managerial Personnel and other employees.
Significant and material orders passed by the Regulators or Courts or Tribunals
During the previous year, the Director Horticulture -Maharashtra had issued the Order dated 30th July, 2016 deregistering the Company in the State of Maharashtra for a period of 10 years and also restricting to participate in any subsidy related business in the State on account of failure of samples in testing.
The Company had taken up the matter at the appropriate levels and based on the merits, the samples were subsequently retested and passed at the recognized laboratory. Subsequently, the Department of Horticulture had registered the Company as per Order dated 26th September, 2017 for a period of 5 years from 2017-18 and accordingly, the earlier order of July, 2016 stands set aside.
Further the Order dated 28th March, 2017 from the Director Horticulture and Farm forestry, Madhya Pradesh inter alia, de-registering the Company in the State of Madhya Pradesh from participating in State Sponsored Horticulture Subsidy Scheme in the country for a period of 1 year was stayed vide its Order dated 1st April, 2017. Subsequently based on the merits of the matter, the said order was cancelled vide Order dated 29th June, 2017 by the Director Horticulture, Madhya Pradesh.
Directorsâ Responsibility Statement
Pursuant to section 134 (5) (e) of the Companies Act, 2013, your Directors, based on the representations received from the Operating Management, and after due enquiry, state that:
a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on aâgoing concernâ basis;
e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Corporate Social Responsibility Committee
The Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.
The CSR Policy may be accessed on the Companyâs website at the link: http://www.epcmahindra.com/pdf/EPC_CSR_Policy.pdf
The key philosophy of all CSR initiatives of the Company is guided by three core commitments of Scale, Impact and Sustainability.
The Company has identified few focus areas of engagement, which are as under:
- Rural Transformation: Creating sustainable livelihood solutions, addressing poverty, hunger and malnutrition.
- Health: Affordable solutions for healthcare through improved access, awareness and health seekingbehaviour.
- Education: Access to quality education, training and skill enhancement.
- Environment: Environmental sustainability, ecological balance, conservation of natural resources.
- Disaster Response: Managing and responding to disaster.
During the year under review, your Company initiated few projects such as supply of drinking water pipe line, upgradation of the toilet facilities of a school in the rural area, medical check-up camps. These projects were mainly implemented directly through employee participation.
During the year under review, the Company has spent Rs. 16.44 lacs, which is over 2% of the average net profits of last three financial years, on CSR activities.
The Annual Report on CSR activities is annexed herewith, marked as Annexure VI.
Disclosures under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder
During the year under review, there were no complaints reported/ resolved pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder.
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. Whistle Blower or Complainant, as the case may be under the said Policy, shall be entitled to direct access to the Chairperson of the Audit Committeein appropriate or exceptional cases.This policy is explained in the Report on Corporate Governance and also posted on the website of Company.
Auditors
The Auditors, Messrs. Deloitte Haskins & Sells, Chartered Accountants, Baroda holds office under second term of five years until the conclusion of the Annual General Meeting to be held in the year 2021 as per the Resolution passed by the Shareholders on July 29, 2016 subject to the ratification by members in every Annual General Meeting. The Auditors are eligible for reappointment under Section 139 (1) of the Companies Act, 2013 and have furnished a certificate to this effect. The Directors recommend for ratification of their reappointment as Auditors of the Company.
Cost Auditors
The Company had filed the Cost Audit Report as per the Companies (Cost Accounting Records) Rules, 2011 prescribed under Section 148 (6) of Companies Act, 2013 and Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014 pertaining to the financial year 2016-17 before the due date of filing.
Pursuant to section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of the Audit Committee appointed M/s Shilpa & Company, Cost Accountants, as the Cost Auditors of the Company for the financial year 2018-19. M/s Shilpa & Company have confirmed that their appointment is within the limits of section 139 of the Companies Act, 2013 and have also certified that they are free from any disqualification specified under Sections 141(3) and 148(5) of the Companies Act, 2013.
The Audit Committee has also received a Certificate from the Cost Auditor certifying their independence and armâs length relationship with the Company.
The Directors recommend the remuneration payable to the Cost Auditors of the Company for the year 2018-19. The approval from Shareholders for the remuneration payable to the Cost Auditors is being sought at the ensuing Annual General Meeting.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Rules therein, the Secretarial Audit Report for the financial year ended on 31st March, 2018 issued by Mr. Sachin Bhagwat, Practising Company Secretary is attached as Annexure VII to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Public Deposits & Loans / Advances
During the year, the Company did not accept any fixed deposit. There were unclaimed/unpaid deposits and unclaimed/ unpaid interest warrants outstanding as on 31st March, 2018 amounting to Rs.0.16 lacs. Your Company has neither made any loans or advances nor did any guarantees or securities which are required to be disclosed in the Annual Accounts of the Company.
Uses & Application of Funds raised under Rights Issue
In the year 2012, the Company had allotted 1,03,58,199 equity shares at a price of Rs. 40 per share (including a premium of Rs. 30/- per share) resulting in total issue size of Rs. 41.43 crores under the Rights Issue.
The uses and application of funds raised under Rights Issue are given in Note No - 34 to the Financial Statement. With this, the Rights Issue proceeds of Rs. 41.43 crores have been fully utlised.
Energy Conservation and Technology Absorption and Foreign Exchange Earnings and Outgo
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo as required to be disclosed under sub-section(3) (m) of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are provided in Annexure VIII to this Report.
DISCLOSURES:
Audit Committee
The Audit Committee comprises Independent Directors namely M/s. Vinayak Patil (Chairman), S Durgashankar and Anand Daga as other members.
All the recommendations made by the Audit Committee were accepted by the Board.
CSR Committee
The CSR Committee comprises M/s Ashok Sharma (Chairman), S Durgashankar and Vinayak Patil as other members.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises Directors namely M/s. Anand Daga (Chairman), S Durgashankar and Vinayak Patil as other members.
Meetings of the Board
Four meetings of the Board of Directors were held during the year. For further details, please refer the Report on Corporate Governance of this Annual Report.
Extract of Annual Return
Pursuant to Sub- section 3(a) of Section 134 and Sub-section 3 of Section 92 of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules 2014, the extracts of Annual Return of the Company as at 31st March, 2018 is annexed herewith as Annexure IX to this Report.
Statement of deviation(s) or variation(s)
During the year under review, there were no deviations of funds reported to the Audit Committee in respect of the funds raised in the year 2012, under the Rights Issue.
General
Your Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively.
Further, your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Companies Act, 2013.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.
4. There were no frauds reported by auditors (including Secretarial and Cost auditor) to the Audit Committee or Board and also not reported to the Central Government.
5. There were no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year and the date of this Report.
Particulars of Employees
Particulars of employees as required under Section 197 of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report and marked as Annexure III (B) and (C). In accordance with the provisions of Section 136 of the Act, the Annual Report and Accounts are being sent to all the Members of the Company excluding the aforesaid information and the said particulars will be made available on request and also made available for inspection at the Registered Office of the Company. Any Member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.
Acknowledgements
Your Directors take this opportunity to place on record their sincere appreciation for the co-operation and continued support received from customers, vendors, suppliers, bankers, business associates and shareholders.
For and on behalf of the Board
Vinayak Patil Ashok Sharma
Director Managing Director
Place : Nashik
Dated : 3rd May, 2018
Mar 31, 2017
DIRECTORSâ REPORT
Your Directors are pleased to present the 35th Annual Report on business and operations of your Company along with the audited financial statements and accounts for the year ended 31st March, 2017.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
|
For the Year ended 31st March, 2017 |
For the Year ended 31st March, 2016* |
|
|
Revenue from Operations |
20,141.83 |
20,295.73 |
|
Other Income |
186.63 |
224.49 |
|
Total Income |
20,328.46 |
20,520.22 |
|
Profit Before Interest, Depreciation & Tax |
1,425.57 |
1,338.21 |
|
Finance cost |
152.89 |
45.95 |
|
Depreciation |
304.78 |
265.54 |
|
Profit Before Tax |
967.90 |
1,026.72 |
|
Tax expense |
(22.57) |
152.25 |
|
Profit After Tax |
990.47 |
874.47 |
|
Other comprehensive income/ (loss) for the year |
(2.21) |
39.43 |
|
Profit for the year attributable to owners of the Company |
988.26 |
913.90 |
|
Add : Balance Brought Forward |
(84.82) |
(998.72) |
|
Surplus/(Deficit) Carried to the Balance Sheet |
903.43 |
(84.82) |
* Figures have been regrouped as per Indian Accounting Standards (IND AS).
Operations and Financial Overview
During the year under review, your Companyâs turnover was at Rs. 201.42 crore as compared to Rs. 202.96 crore for the previous year.
The Company made a Profit Before Tax of Rs. 9.68 Crore for the year 2016-17 as compared to Rs. 10.27 Crore in the previous year. The Profit After Tax was at Rs. 9.90 crore vs. Rs. 8.74 crore in the previous year reflecting growth of 13.3% over the previous year.
The performance of the year 2016-17 was benefitted due to implementation of core strategies, acceleration of business in project markets, coupled with improved operational efficiencies.
Dividend
Your Directors feel that it is prudent to plough back the profits for future growth of the Company and do not recommend any dividend for the year ended 31st March, 2017.
Corporate Governance & Management Discussion and Analysis Report
Your Company believes in sound practices of good Corporate Governance. Transparency, Accountability, and Responsibility are the fundamental guiding principles for all decisions, transactions, and policy matters of the Company. A Report on Corporate Governance, along with a certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of this Annual Report.
Further, the Management Discussion and Analysis Report for the year under review, as stipulated under Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, is given in Annexure I to this Report.
Stock Options
The Nomination and Remuneration Committee of the Board of Directors of the Company, inter alia, administers and monitors the Employees Stock Option Scheme of the Company. The Stock Option Scheme, 2014 is in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and there have been no material changes in the said scheme during the year under review.
During the year under review 14,089 nos. Stock Options got vested under the Employees Stock Option Scheme -2014, and were exercised immediately after vesting. Accordingly, the Company made the allotment of 14,089 Equity Shares.
The Nomination and Remuneration Committee of the Board of Directors further granted 1,33,432 Stock Options during the year under review, comprising about 0.04% of the current paid up capital.
The applicable disclosures as stipulated under the SEBI Guidelines as on 31st March, 2017 (cumulative position) with regard to the Employeesâ Stock Option Scheme (ESOS) are provided in Annexure II to this Report.
Voting rights on the shares issued to employees under the ESOS are either exercised by them directly or through their appointed proxy.
Share Capital
During the year, with the allotment of 14,089 equity shares on exercising of Stock Options by employees, the total paid up equity share capital of the Company increased from 2,76,58,472 equity shares of Rs 10/- each to 2,76,72,561 equity shares of Rs 10/- each. The said equity shares have been listed on the Bombay Stock Exchange Limited and they rank pari passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs. 27,67,25,610 divided into 2,76,72,561 equity shares of Rs. 10 each as on 31st March, 2017.
Holding Company
The promoters of the Company i.e. Mahindra and Mahindra Limited (M & M) hold 1,51,44,433 equity shares which represents 54.73 percent of the total paid up capital of the Company. Your Company continues to be a subsidiary company of M & M. The Company does not have any subsidiary company.
Contracts and arrangements with Related Parties
During the financial year, all contracts/arrangements/ transactions entered by the Company with related parties were in the ordinary course of business and on an armâs length basis. During the year, the Company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.
All related party transactions are placed before the Audit Committee for approval, wherever applicable. Prior omnibus approval is also obtained from the Audit Committee for the related party transactions which are of repetitive nature as well as the transactions which cannot be foreseen and accordingly, the required disclosures are made to the Committee on quarterly basis in terms of approval of the Committee.
The Companyâs major related party transactions are generally with its holding and associate companies. The related party transactions are entered into based on considerations of various business exigencies, such as synergy in operations, sales transactions through tenders or otherwise. All related party transactions are negotiated on an arms-length basis, and are intended to promote the Companyâs interests.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at the link: http://www.epcmahindra.com/pdf/EPC_Policy_on_Related Party_Transactions.pdf. The related party transactions have been set out in the Note No. 29 to the financial statement.
Risk Management
The Company has constituted a Risk Management Committee comprising Mr. Nikhilesh Panchal, Mr. Ashok Sharma and Mr. Anand Daga. Mr. Nikhilesh Panchal is the Chairman of this Committee. The Company has adopted the Risk Management Policy. The Committee is entrusted with the responsibility to assist the Board in (a) overseeing and approving the Companyâs enterprise wide risk management framework; and (b) overseeing that all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed.
There is an adequate mechanism in place about risks and uncertainties that can impact its ability to achieve its strategic objectives, risk assessment, risk mitigation and minimization procedures and its periodical review.
Industrial relations
Employees at all levels have contributed to the performance of your Company. Your directors place on record the cooperation of employees during the year under report. The Directors also place on record the unstinted cooperation extended by the staff members during the period under review.
The Management Discussion and Analysis Report gives an overview of the developments in Human Resources/Industrial Relations during the year.
Safety, Health and Environmental Performance
Your Companyâs commitment towards safety, health and environment is being continuously enhanced and your Company encourages involvement of all its employees in activities related to safety, including promotion of safety standards. This has demonstrated with no single incidence of accident for last 924 days.
The Safety Committee constituted for the same, regularly reviews the adherence of safety norms. Some of the programs undertaken by the Company include behavior based safety training, Knowledge based fire extinguisher training, fire fighting training and safety awareness, etc.
Various health checkup programs for employees were regularly undertaken by the Company during the year.
Requirements relating to various environmental legislations and environment protection have been duly complied by your Company.
Directors and Key Managerial Personnel
a) Key Managerial Personnel (KMP)
In accordance with the provisions of Section 203 of the Act, the following persons have been designated as KMP of the Company as at 31st March, 2017:
|
Name of the KMP |
Designation |
|
Mr. Ashok Sharma |
Managing Director |
|
Mr. Sanjeev Mohoni |
Chief Executive Officer (CEO) |
|
Ms. Sunetra Ganesan |
Chief Financial Officer (CFO) |
|
Mr. Ratnakar Nawghare |
Company Secretary (CS) |
Ms. Sunetra Ganesan was appointed as CFO in place of Mr. Mayur Bumb, who separated from the Company on 9th December, 2016.
b) Directors
Pursuant to the provisions of Section 149 of the Companies Act, 2013, the Non independent Director Mr. S Durgashankar would retire and, being eligible, has offered himself for reappointment.
The three yearsâ term of Mr. Ashok Sharma as Managing Director would be expiring on 30th September, 2017 and would require to be renewed for a further period of 3 years with effect from 1st October, 2017. The approval from shareholders for renewal of his term is being sought at the ensuing Annual General Meeting.
The Company has received Notice in writing from a Member proposing Mr. Ashok Sharma for re-appointment as Managing Director at the ensuing Annual General Meeting.
The Company has received declarations from all the Independent Directors of the Company under Section 149(7) of the Act confirming that they meet the criteria of independence laid down in Section 149(6) of the Companies Act, 2013.
The information required pursuant to Section 197(12) read with Rule 5 (1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of ratio of remuneration of a director to the median remuneration of the employees of the Company for the financial year is given in the Annexure III to this Report.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the non-executive directors and executive director. The statement indicating the manner in which formal annual evaluation of the Directors, the Board and Board level committees are given in detail in the Report on Corporate Governance, which forms part of this Annual Report.
The Company had on the basis of the Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors, followed a process of evaluation by the Board for its own performance and that of its Committees and individual Directors.
The details of programmes for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company. During the year the Independent Directors of the Company met on 27th April, 2016.
The following policies of the Company are attached herewith marked as Annexure IV and Annexure V:
a) Policy on Appointment of Directors and Senior Management and Succession Planning for Orderly Succession to the Board and the Senior Management.
b) Policy for Remuneration of the Directors, Key Managerial Personnel and other employees.
Significant and material orders passed by the Regulators or Courts or Tribunals
During the year under review, the Director Horticulture -Maharashtra had issued the order dated 30th July, 2016 deregistering the Company in the State of Maharashtra and also restricting to participate in any subsidy related business in the State on account of failure of samples in testing.
The Company had raised many issues and flaws in respect of non adherence to sample testing procedure, preservation of samples and non-adherence to PMKSY Guidelines etc. Based on the merits, the samples were subsequently retested and passed at the recognized laboratory. The Company is expecting the positive outcome in the matter soon.
Material changes and commitments affecting the financial position of the Company
The Company has received Order dated 1st April, 2017 from the Director Horticulture and Farm Forestry, Madhya Pradesh, staying his earlier Order dated 28th March, 2017 inter alia, de-registering the Company in the State of Madhya Pradesh from participating in State Sponsored Horticulture Subsidy Scheme in the country for a period of 1 year.
Directorsâ Responsibility Statement
Pursuant to section 134 (5) (e) of the Companies Act, 2013, your Directors, based on the representations received from the Operating Management, and after due enquiry, state that:
a) in the preparation of the annual accounts for the year ended 31st March, 2017, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2017 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a âgoing concernâ basis;
e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Corporate Social Responsibility Committee
The Corporate Social Responsibility Committee (CSR Committee) has formulated and recommended to the
Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.
The CSR Policy may be accessed on the Companyâs website at the link: http://www.epcmahindra.com/pdf/EPC_CSR_ Policy.pdf
The key philosophy of all CSR initiatives of the Company is guided by three core commitments of Scale, Impact and Sustainability.
The Company has identified few focus areas of engagement which are as under:
- Rural Transformation: Creating sustainable livelihood solutions, addressing poverty, hunger and malnutrition.
- Health: Affordable solutions for healthcare through improved access, awareness and health seeking behaviour.
- Education: Access to quality education, training and skill enhancement.
- Environment: Environmental sustainability, ecological balance, conservation of natural resources.
- Disaster Response: Managing and responding to disaster.
During the year under review, your Company initiated few projects such as girl child education, supply of drinking water pipe line, providing solar water systems and supply of benches to a school in the rural area, River excavation work under Jalaukt Shiwar Yojana, medical check-up camps, tree plantation etc. These projects were mainly implemented directly through employee participation.
During the year under review, the Company has spent Rs. 14.95 lacs, which is over 2% of the average net profits of last three financial years, on CSR activities.
The Annual Report on CSR activities is annexed herewith marked as Annexure VI.
Disclosures under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed there under
During the year under review, there were no complaints reported/resolved pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed there under.
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. Whistle Blower or Complainant, as the case may be under the said Policy, shall be entitled to direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases. This policy is explained in the Report on Corporate Governance and also posted on the website of Company.
Auditors
The Auditors, Messrs. Deloitte Haskins & Sells, Chartered Accountants, Baroda holds office under second term of five years until the conclusion of the Annual General Meeting to be held in the year 2021 as per the Resolution passed by the Shareholders on July 29, 2016 subject to the ratification by members in every Annual General Meeting. The Auditors are eligible for reappointment under Section 139 (1) of the Companies Act, 2013 and have furnished a certificate to this effect. The Directors recommend for ratification of their reappointment as Auditors of the Company.
Cost Auditors
The Company had filed the Cost Audit Report as per the Companies (Cost Accounting Records) Rules, 2011 prescribed under Section 148 (6) of Companies Act, 2013 and Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014 pertaining to the financial year 2015-16 before the due date of filing.
Pursuant to section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of the Audit Committee appointed M/s Shilpa & Company, Cost Accountants, as the Cost Auditors of the Company for the financial year 2017-18. M/s Shilpa & Company have confirmed that their appointment is within the limits of Section 139 of the Companies Act, 2013 and have also certified that they are free from any disqualification specified under Sections 141(3) and 148(5) of the Companies Act, 2013.
The Audit Committee has also received a Certificate from the Cost Auditor certifying their independence and armâs length relationship with the Company.
The Directors recommend the remuneration payable to the Cost Auditors of the Company for the year 2017-18. The approval from Shareholders for the remuneration payable to the Cost Auditors is being sought at the ensuing Annual General Meeting.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Rules therein, the Secretarial Audit Report for the financial year ended on 31st March, 2017 issued by Mr. Sachin Bhagwat, Practising Company Secretary is attached as Annexure VII to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Public Deposits & Loans/Advances
During the year, the Company did not accept any fixed deposit. There were unclaimed/unpaid deposits and unclaimed/ unpaid interest warrants outstanding as on March 31, 2017 amounting to Rs. 0.91 lacs. Your Company has neither made any loans or advances nor did any guarantees or securities which are required to be disclosed in the Annual Accounts of the Company.
Uses & Application of Funds raised under Rights Issue
In the year 2012, the Company had allotted 1,03,58,199 equity shares at a price of Rs. 40 per share (including a premium of Rs. 30/- per share) resulting in total issue size of Rs. 41.43 crores under the Rights Issue.
The uses and application of funds raised under Rights Issue are given in Note No - 35.1 to the Financial Statement. The Uses and Application of funds under Rights Issue are monitored regularly by the Audit Committee.
Energy Conservation and Technology Absorption and Foreign Exchange Earnings and Outgo
The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo as required to be disclosed under sub-section(3) (m) of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are provided in Annexure VIII to this Report.
DISCLOSURES:
Audit Committee
The Audit Committee comprises Independent Directors namely M/s. Vinayak Patil (Chairman), S Durgashankar and Anand Daga as other members.
All the recommendations made by the Audit Committee were accepted by the Board.
CSR Committee
The CSR Committee comprises M/s Ashok Sharma (Chairman),
S Durgashankar and Vinayak Patil as other members.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises Directors namely M/s. Anand Daga (Chairman), S Durgashankar and Vinayak Patil as other members.
Meetings of the Board
Five meetings of the Board of Directors were held during the year. For further details, please refer the Report on Corporate Governance of this Annual Report.
Extract of Annual Return
Pursuant to Sub-section 3(a) of Section 134 and Sub-section 3 of Section 92 of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules 2014, the extracts of Annual Return of the Company as at 31st March, 2017 is annexed herewith as Annexure IX to this Report.
Statement of deviation (s) or variation (s)
During the year under review, there were no deviations of funds reported to the Audit Committee in respect of the funds raised in the year 2012, under Rights Issue.
General
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Companies Act, 2013.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.
4. There were no frauds reported by auditors (including Secretarial and Cost auditor) to the Audit Committee or Board and also not reported to the Central Government.
Particulars of Employees
Particulars of employees as required under Section 197 of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report and marked as Annexure III (B) and (C). In accordance with the provisions of Section 136 of the Act, the Annual Report and Accounts are being sent to all the Members of the Company excluding the aforesaid information and the said particulars will be made available on request and also made available for inspection at the Registered Office of the Company. Any Member interested in obtaining such particulars may write to the Company Secretary at the Registered Office of the Company.
Acknowledgements
Your Directors take this opportunity to place on record their sincere appreciation for the co-operation and continued support received from customers, vendors, suppliers, bankers, business associates and shareholders.
For and on behalf of the Board
Vinayak Patil Ashok Sharma
Director Managing Director
Place : Nashik
Dated : 27th April, 2017
Mar 31, 2015
Dear Members,
The Directors are pleased to present the 33rd Annual Report on
business and operations of your Company along with the audited
financial statements and accounts for the year ended 31st March, 2015.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
For the Year For the Year
ended 31st ended 31st
March, 2015 March, 2014
Turnover (Net) 16922.90 17472.52
Other Income 256.26 256.60
17179.16 17729.12
Profit Before Interest,
Depreciation & Tax 660.80 1285.74
Finance cost 119.56 235.34
Depreciation 273.76 279.41
Profit Before Tax 267.48 770.99
Tax expense 88.00 Â
Profit After Tax 179.48 770.99
Transfer to General Reserve  Â
Add : Balance Brought
Forward (1085.47) (1856.46)
Depreciation on transaction to
Schedule II to the Companies
Act, 2013 (69.26) Â
Deficit Carried to the Balance
Sheet (975.25) (1085.47)
Figures have been regrouped wherever necessary. Operations and
Financial Overview
During the year under review, your Company's turnover was at Rs.
169.23 crore as compared to Rs. 174.73 crore for the previous year
affecting the performance marginally. The Profit Before Tax was at Rs.
2.67 crore vs. Rs. 7.71 crore in the previous year, The Profit after
tax was at Rs. 1.79 crore vs. Rs. 7.71 crore in the previous year.
The year 2014-15 was quite challenging amidst untimely rain, pendency
in subsidies release, delays in introduction of Subsidy scheme as per
National Mission on Sustainable Agriculture (NMSA) guidelines by few
States resulting in subdued demand from farmer community.
Despite these constraints and challenging environment, the Company
could achieve this performance.
During the year under review, the Company has entered into Memorandum
of Understanding with M/s S - Rain Control A/S, Denmark, an automation
products manufacturer in Irrigation Systems. This will assist in
catering to farmers using hi-end technology for farming. This new
business will contribute significantly to the Company's top line and
bottom line in the years to come.
Dividend
Your Directors do not recommend any dividend considering the need to
augment resources for operational purposes.
Corporate Governance & Management Discussion and Analysis Report
Your Company believes in sound practices of good Corporate Governance.
Transparency, Accountability, and Responsibility are the fundamental
guiding principles for all decisions, transactions, and policy matters
of the Company. A Report on Corporate Governance alongwith a
certificate from the Statutory Auditors of the Company regarding
compliance of conditions of Corporate Governance as stipulated under
Clause 49 of the Listing Agreement, forms part of this Annual Report.
Further, the Management Discussion and Analysis Report for the year
under review, as stipulated under Clause 49 of the Listing Agreement
with the Stock Exchange, is given in Annexure I to this Report.
Stock Options
The Nomination and Remuneration Committee of the Board of Directors of
the Company, inter alia, administers and monitors the Employees'
Stock Option Scheme of the Company in accordance with the applicable
SEBI Guidelines.
During the year under review 6125 Nos. Stock Options got vested under
the Employees Stock Option Scheme - 2010, and were exercised
immediately after vesting. Accordingly, the Company made the allotment
of 6125 Equity Shares on 21st November, 2014 against these options
exercised by the employees.
In pursuance of the approval of the Members at the previous Annual
General Meeting held on 31st July, 2014 your Company has formulated and
implemented New Employee Stock Option Scheme - 2014 (the Scheme) for
grant of Employee Stock Options to employees of the Company in the form
of Stock Options and/or Restricted Stock Units ("RSUs") and/or
other instruments ("Options") exercisable into Equity Shares. The
Nomination and Remuneration Committee of the Board of Directors has
granted 80,424 Stock Options during the year under review, comprising
about 0.29% of the current paid up capital of the Company.
The applicable disclosures as stipulated under the SEBI Guidelines as
on March 31, 2015 (cumulative position) with regard to the Employees'
Stock Option Scheme (ESOS) are provided in Annexure II to this Report.
The Company has received a certificate from the Auditors of the Company
that the Scheme has been implemented in accordance with the SEBI
Guidelines and the resolution passed by the members. The certificate
would be placed at the Annual General Meeting for inspection by
members. Voting rights on the shares issued to employees under the
ESOS are either exercised by them directly or through their appointed
proxy.
Share Capital
During the year, with the allotment of 6125 equity shares on exercising
of Stock Options by employees, the total paid up equity share capital
of the Company increased from 2,76,38,239 equity shares of Rs. 10/-
each to 2,76,44,364 equity shares of Rs. 10/- each. The said equity
shares have been listed on the Bombay Stock Exchange Limited and they
rank pari passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs.
27,64,43,640 divided into 2,76,44,364 equity shares of Rs. 10 each as
on 31st March, 2015.
Holding Company
The promoters of the Company i.e. Mahindra and Mahindra Limited (M & M)
hold 1,51,44,433 equity shares which represents 54.78 percent of the
total paid up capital of the Company. Your Company continues to be a
subsidiary company of M & M. The Company does not have any subsidiary
company.
Contracts and arrangements with Related Parties
During the financial year, all contracts/arrangements/ transactions
entered by the Company with related parties were in the ordinary course
of business on an arm's length basis. During the year, the Company
had not entered into any contract/arrangement/transaction with related
parties which could be considered material in accordance with the
policy of the Company with materiality of related party transactions.
All related party transactions are placed before the Audit Committee
for approval wherever applicable. Prior omnibus approval is also
obtained from the Audit Committee for the related party transactions
which are of repetitive nature as well as the transactions which cannot
be foreseen and accordingly, the required disclosures are made to the
Committee on quarterly basis in terms of approval of the Committee.
The Company's major related party transactions are generally with its
holding and associate companies. The related party transactions are
entered into based on considerations of various business exigencies,
such as synergy in operations, sale transactions through tenders or
otherwise. All related party transactions are negotiated on an
arms-length basis, and are intended to promote the Company's
interests.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board may be
accessed on the Company's website at the link:
http://www.epcmahindra.com/pdf/EPC_Policy_on_Related_ Party_
Transactions.pdf. The related party transactions have been set out in
the Note No. 31 to the financial statement.
Risk Management
During the year, your Directors have constituted a Risk Management
Committee under the chairmanship of Mr. Nikhilesh Panchal and Mr.
Ashok Sharma and Mr. Anand Daga
being other members. The Committee has been entrusted with the
responsibility to assist the Board in (a) Overseeing and approving the
Company's enterprise wide risk management framework; and (b)
Overseeing that all the risks that the organization faces such as
strategic, financial, credit, market, liquidity, security, property,
IT, legal, regulatory, reputational and other risks have been
identified and assessed and there is an adequate risk management
infrastructure in place capable of addressing those risks. The Risk
Management Policy was reviewed and recommended by the Risk Management
Committee and approved by the Board of Directors.
The Company manages, monitors and reports on the principal risks and
uncertainties that can impact its ability to achieve its strategic
objectives, risk mitigation measures and internal controls and
processes.
Industrial Relations
The industrial Relations continue to be peaceful and cordial at all
levels. The Directors wish to place on record their sincere
appreciation of the Company's employees at all levels. The
Company's consistent growth is made possible by their hard work
solidarity, co-operation and support.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources/Industrial Relations during the year.
Safety, Health and Environmental Performance Your Company's
commitment towards safety, health and environment is being continuously
enhanced and your Company encourages involvement of all its employees
in activities related to safety, including promotion of safety
standards.
During the year under review, no major accidents occurred. The Safety
Committee regularly reviews the adherence of safety norms. Some of the
programmes undertaken by the Company such as the behaviour based safety
training, Knowledge based fire extinguisher training, and fire fighting
training and safety awareness have resulted in the reduction of number
of accidents.
Various health checkup programmes for employees were regularly
undertaken by the Company during the year.
Requirements relating to various environmental legislations and
environment protection have been duly complied by your Company.
Directors and Key Managerial Personnel Pursuant to the provisions of
Section 149 of the Companies Act, 2013, the Non independent Director
Mr. S Durgashankar would retire and, being eligible, has offered
himself for reappointment. Ms. Sangeeta Prasad was co-opted on the
Board on 28th October, 2014 and holds office upto the ensuing Annual
General Meeting, being eligible, has offered herself for appointment.
The Company has received Notices in writing from Member alongwith
requisite deposit, proposing Ms. Sangeeta Prasad for appointment to the
office of Director at the ensuing Annual General Meeting.
The Shareholders in the Annual General Meeting held on 31st July, 2014
appointed Mr. Ashok Sharma as Whole Time Director designated as
Executive Director and CEO of the Company with effect from 1st October,
2014, on a consolidated remuneration of Rs. 12,00,000 per annum for a
period of three years. Mr. Ashok Sharma is also receiving a
remuneration from the holding Company M/s. Mahindra and Mahindra
Limited. The Board of Directors has approved the re-designation of Mr.
Ashok Sharma as Executive Director with effect from 1st June, 2015.
Pursuant to the provisions of Section 203 of the Companies Act, 2013,
the Board of Directors has further approved appointment of Mr. Sanjeev
Mohoni as Chief Executive Officer of the Company with effect from 1st
June, 2015 who will be looking after day to day affairs of the Company.
In terms of the provisions of Section 149 of the Companies Act, 2013
and other applicable provisions, if any, the Shareholders have
appointed Mr. Vinayak Patil, Mr. Nikhilesh Panchal and Mr. Anand Daga
as Independent Directors of the Company for a period of 5 years in the
Annual General Meeting held on 31st July, 2014 who are not liable to
retire by rotation.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet the criteria of
independence as prescribed both under the Act and Clause 49 of the
Listing Agreement with the Stock Exchange.
The information required pursuant to Section 197(12) read with Rule
5(1) of The Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 in respect of ratio of remuneration of a
director to the median remuneration of the employees of the Company for
the financial year is given in the Annexure III to this Report.
The Company has devised a Policy for performance evaluation of
Independent Directors, Board, Committees and other individual Directors
which include criteria for performance evaluation of the non-executive
directors and executive director. The statement indicating the manner
in which formal annual evaluation of the Directors, the Board and Board
level committees are given in detail in the report on Corporate
Governance, which forms part of this Annual Report.
The Company had on the basis of the Policy for performance evaluation
of Independent Directors, Board, Committees and other individual
Directors, followed a process of evaluation by the Board for its own
performance and that of its Committees and individual Directors.
The details of programmes for familiarisation of Independent Directors
with the Company, their roles, rights, responsibilities
in the Company, nature of the industry in which the Company operates,
business model of the Company and related matters are put up on the
website of the Company.
The following policies of the Company are attached herewith marked as
Annexure IV and Annexure V:
a) Policy on Appointment of Directors and Senior Management and
Succession Planning for Orderly Succession to the Board and the Senior
Management.
b) Policy for Remuneration of the Directors, Key Managerial Personnel
and other employees.
Directors' Responsibility Statement
Pursuant to section 134(5)(e) of the Companies Act, 2013, your
Directors, based on the representations received from the Operating
Management, and after due enquiry, state that:
a) in the preparation of the annual accounts for the year ended March
31, 2015, the applicable accounting standards read with requirements
set out under Schedule III to the Act, have been followed and there are
no material departures from the same;
b) the Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2015 and of the profit of the Company
for the year ended on that date;
c) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a 'going
concern' basis;
e) the Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and operating effectively.
Corporate Social Responsibility Committee
The Corporate Social Responsibility Committee (CSR Committee) has
formulated and recommended to the Board, a Corporate Social
Responsibility Policy (CSR Policy) indicating the activities to be
undertaken by the Company, which has been approved by the Board.
The CSR Policy may be accessed on the Company's website at the link:
http://www.epcmahindra.com/pdf/EPC_CSR_ Policy.pdf
The key philosophy of all CSR initiatives of the Company is guided by
three core commitments of Scale, Impact and Sustainability.
The Company has identified few focus areas of engagement which are as
under:
- Rural Transformation: Creating sustainable livelihood solutions,
addressing poverty, hunger and malnutrition.
- Health: Affordable solutions for healthcare through improved
access, awareness and health seeking behaviour.
- Education: Access to quality education, training and skill
enhancement.
- Environment: Environmental sustainability, ecological balance,
conservation of natural resources.
- Disaster Response: Managing and responding to disaster.
During the year under review your Company initiated few projects such
as renovation of school building in the rural area, girl child
education, pure drinking water, medical equipment for old age and
disabled persons. These projects were mainly implemented directly
through employee participation. The Company has also actively
participated in the "Mahindra's Hariyali Project of 1 Million tree
plantation.
During the year under review, the Company has spent Rs. 13.79 lacs
which is around 2.05% of the average net profits of last three
financial year on CSR activities.
The Annual Report on CSR activities is annexed herewith marked as
Annexure VI.
Internal Complaints Committee
During the year under review, no complaints were reported to/resolved
by the Committee for the year ended 31st March, 2015 in accordance with
the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
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 Report on Corporate Governance and also posted on the
website of the Company.
Internal Financial Control Systems and their adequacy
Your Company has laid down set of standards, processes and structures
which enables to implement internal financial control across the
organisation and ensure that the same are adequate and operating
effectively.
Auditors
The Auditors, Messrs. Deloitte Haskins & Sells, Chartered Accountants,
Baroda holds office until the conclusion of the ensuing Annual General
Meeting. The Auditors are eligible for reappointment under Section
139(1) of the Companies Act, 2013 and have furnished a certificate to
this effect. The Directors recommend their reappointment as Auditors of
the Company upto the conclusion of the next Annual General Meeting.
Cost Auditors
The Company had filed the Cost Audit Report as per the Companies (Cost
Accounting Records) Rules, 2011 prescribed under Section 209(1)(d) of
the Companies Act, 1956 pertaining to the financial year 2013-14 before
the due date of filing.
Pursuant to section 148 of the Companies Act, 2013, the Board of
Directors, on the recommendation of the Audit Committee appointed M/s
Shilpa & Company, Cost Accountants, as the Cost Auditors of the Company
for the financial year 2015-16. M/s Shilpa & Company have confirmed
that their appointment, is within the limits of section 139 of the
Companies Act, 2013 and have also certified that they are free from any
disqualification specified under sections 141(3) and 148(5) of the
Companies Act, 2013.
The Audit Committee has also received a Certificate from the Cost
Auditor certifying their independence and arm's length relationship
with the Company.
The Directors recommend the remuneration payable to the Cost Auditors
of the Company for the year 2015-16. The approval from Shareholders for
the remuneration payable to the Cost Auditors is being sought at the
ensuing Annual General Meeting.
Secretarial Auditors
Pursuant to provisions of Section 204 of the Companies Act, 2013, the
Board has appointed Mr. Sachin Bhagwat Practising Company Secretary, to
conduct Secretarial Audit for the financial year 2014-15. The
Secretarial Audit Report for the financial year ended on 31st March,
2015 is annexed as Annexure VII to this Report. The Secretarial Audit
Report does not contain any qualification, reservation or adverse
remark.
Public Deposits & Loans/Advances
During the year, the Company did not accept any fixed deposit. The
deposits accepted in the previous years were repaid on 30th September,
2014. There were unclaimed/unpaid deposits and unclaimed/unpaid
interest warrants outstanding as on March 31, 2015 amounting to Rs.
4.83 lacs. Your Company has neither made any loans or advances nor any
guarantees or securities provided which are required to be disclosed in
the Annual Accounts of the Company pursuant to Clause 32 of the Listing
Agreement.
DISCLOSURES:
CSR Committee
The CSR Committee comprises M/s Ashok Sharma (Chairman), S Durgashankar
and Vinayak Patil as other members.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises Directors namely
M/s Anand Daga (Chairman), S Durgashankar and Vinayak Patil as other
members.
Audit Committee
The Audit Committee comprises Directors namely M/s Vinayak Patil
(Chairman), S Durgashankar and Anand Daga as other members.
All the recommendations made by the Audit Committee were accepted by
the Board.
Meetings of the Board
Five meetings of the Board of Directors were held during the year. For
further details, please refer Report on Corporate Governance of this
Annual Report.
Extract of Annual Return
Pursuant to sub-section 3(a) of Section 134 and sub-section 3 of
Section 92 of the Companies Act, 2013, read with Rule 12 of the
Companies (Management and Administration) Rules 2014, the extracts of
Annual Return of the Company as at 31st March, 2015 is annexed herewith
as Annexure VIII to this Report.
General
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these
items during the year under review:
1. Details relating to deposits covered under Chapter V of the
Companies Act, 2013.
2. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the
Company under any scheme save and except ESOS referred to in this
Report.
4. There were no material changes and commitments, if any, affecting
the financial position of the Company which have occurred between the
end of the financial year and the date of this Report.
5. No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and
Company's operations in future.
Energy Conservation and Technology Absorption and Foreign Exchange
Earnings and Outgo
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo as required to be disclosed under
sub-section(3)(m) of Section 134 of the Companies Act, 2013 read with
Rule 8(3) of the Companies (Accounts) Rules, 2014 are provided in
Annexure IX to this Report.
Particulars of Employees
The Company had no employee, who was employed throughout the financial
year and was in receipt of remuneration of not less than Rs. 60,00,000
per annum during the year ended 31st March, 2015 or was employed for a
part of the financial year and was in receipt of remuneration of not
less than Rs. 5,00,000 per month during any part of the year.
Acknowledgements
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and continued support received from
customers, vendors, suppliers, bankers, business associates and
shareholders.
For and On behalf of the Board
Ashok Sharma Vinayak Patil
Executive Director & CEO Director
Place : Nashik
Dated : 27th April, 2015
Mar 31, 2014
Dear Members,
The Directors are pleased to present the 32nd Annual Report on
business and operations of your Company alongwith the audited financial
statements and accounts for the year ended 31st March, 2014.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
For the Year For the Year
ended 31st ended 31st
March, 2014 March, 2013
Turnover (Net) 17472.52 16140.80
Other Income 256.60 276.02
17729.12 16416.82
profit Before Interest,
Depreciation & Tax 1285.74 1035.15
Finance cost 235.34 246.37
Depreciation 279.41 254.57
profit Before Tax 770.99 534.21
Tax expense  Â
profit After Tax 770.99 534.21
Add : Balance Brought Forward (1856.46) (2390.67)
Defcit Carried to the Balance
Sheet (1085.47) (1856.46)
* Figures have been regrouped wherever necessary.
Operations and Financial Overview
During the year under review, your Company''s turnover was at Rs.
17472.52 lacs as compared to Rs. 16140.80 lacs for the previous year
refecting a growth of 8.3%. The profit Before Tax was at Rs. 770.99 lacs
vs. Rs. 534.21 lacs in the previous year, The profit after tax was at
Rs. 770.99 lacs vs. Rs. 534.21 lacs in the previous year.
FY 2013-14 proved to be a challenging year for your Company amidst
economic uncertainties, hailstorm, untimely rains and change in subsidy
policies of State Governments. Despite these constraints and
challenging environment, the Company could register a marginal growth.
The Company has succeeded in sustaining growth in turnover, due to cost
savings measures, operational cost reduction, lift and shift policy,
optimum utilization of available resources despite the acute pressure
of rising raw material prices.
During the year under review, the Company started its
Greenhouse/Polyhouse business. This new business including Agricultural
Pumps will contribute significantly to the company''s top line and bottom
line in the years to come.
Dividend
Your Directors do not recommend any dividend considering the need to
augment resources for operational purposes.
Management Discussion and Analysis Report
Management Discussion and Analysis Report for the year under review, as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchange, is presented in a separate section forming part of this
Annual Report.
Corporate Governance
Your Company believes in sound practices of good Corporate Governance.
Transparency, Accountability, and Responsibility are the fundamental
guiding principles for all decisions, transactions, and policy matters
of the Company. A Report on Corporate Governance alongwith a certifcate
from the Statutory Auditors of the Company regarding compliance of
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement, forms part of this Annual Report.
Stock Options
During the year under review 7375 Nos. Stock Options got vested in
terms of EPC Industrié Limited Employees Stock Option Scheme -2010, and
were exercised immediately after vesting. Accordingly, the Company made
the allotment of 7375 Equity Shares on 12th December, 2013 against
these options exercised by the employees.
The disclosures as stipulated under the SEBI Guidelines as at March 31,
2014 (cumulative position) are provided in Annexure I to this Report.
EPC Industrié Limited Employees Stock Option Scheme -2014
Your Company proposes to introduce a new Employee Stock Option Scheme
known as "EPC Industrié Limited Employees Stock Option Scheme 2014
("New Scheme"). The New Scheme will facilitate grant of Options to the
employees in the form of Stock Options and/or Restricted Stock Units
("RSUs") and/or other instruments ("Options") exercisable into Equity
Shares. It is proposed that the Options can be exercised by the
employees at a price equal to or not less than the face value of the
Equity Shares of the Company. The necessary Resolutions seeking consent
of the Members are being sought as proposed in the Notice convening the
Annual General Meeting.
The New Scheme has been formulated in accordance with the Guidelines
and other applicable laws.
Share Capital
During the year, with the allotment of 7375 equity shares on exercising
of Stock Options by employees, the total paid up equity share capital
of the Company increased from 2,76,30,864 equity shares of Rs. 10/-
each to 2,76,38,239 equity shares of Rs. 10/- each. The said equity
shares have been listed on the Bombay Stock Exchange Limited and they
rank pari passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs.
27,63,82,390 divided into 2,76,38,239 equity shares of Rs. 10 each as
on 31st March, 2014.
Holding Company
The promoters of the Company i.e. Mahindra and Mahindra Limited (M & M)
hold 1,51,44,433 equity shares which represents 54.80 percent of the
total paid up capital of the Company. Your Company continues to be a
subsidiary company of M & M.
Industrial relations
The industrial relations continue to be peaceful and cordial at all
levels. The Directors wish to place on record their sincere
appreciation of the Company''s employees at all levels. The Company''s
consistent growth is made possible by their hard work solidarity,
co-operation and support.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources / Industrial Relations during the year.
Safety, Health and Environmental Performance
Your Company''s commitment towards safety, health and environment is
being continuously enhanced and your Company encourages involvement of
all its employees in activities related to safety, including promotion
of safety standards.
During the year under review, no major accidents occurred. The Safety
Committee regularly reviews the adherence of safety norms. Some of the
programmes undertaken by the Company such as the behaviour based safety
training, Knowledge based fre extinguisher training and fre fghting
training and safety awareness have resulted in the reduction of number
of accidents.
Various health checkup programmes for employees were regularly
undertaken by the Company during the year.
Requirements relating to various environmental legislations and
environment protection have been duly complied by your Company.
Directors
Pursuant to the provisions of Section 149 of the Companies Act, 2013,
the Independent Directors Mr. Anand Daga, Mr. Vinayak Patil and Mr.
Nikhilesh Panchal being independent Directors would retire and, being
eligible, have offered themselves for reappointment as Independent
Directors.
The three years'' term of Mr. Ashok Sharma as Whole time Director would
be expiring on 30th September, 2014 and would require to be renewed for
a further period of 3 years with effect from 1st October, 2014. The
approval from shareholders for renewal of his term is being sought at
the ensuing Annual General Meeting.
The Company has received Notices in writing from Member(s) proposing
Mr. Anand Daga, Mr. Vinayak Patil, Mr. Nikhilesh Panchal and Mr. Ashok
Sharma for appointment to the office of Directors at the ensuing Annual
General Meeting.
Directors'' Responsibility Statement
Pursuant to section 217 (2AA) of the Companies Act, 1956, your
Directors, based on the representations received from the Operating
Management, and after due enquiry, confirm that:
(i) in the preparation of the annual accounts, the applicable
Accounting Standards have been followed along with proper explanation
relating to material departures;
(ii) they have, in the selection of the accounting policies, consulted
the Statutory Auditors and these have been applied consistently, and
made judgments and estimates that are reasonable and prudent to give a
true and fair view of the state of affairs of the Company as on 31st
March, 2014 and of the profit of the Company for the year ended on that
date;
(iii) proper and suffcient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) the annual accounts have been prepared on a Going Concern basis.
Corporate Social Responsibility Committee
During the year, your Directors have constituted the Corporate Social
Responsibility (CSR) Committee comprising Mr. Ashok Sharma as the
Chairman and Mr. S Durgashankar and Mr. Vinayak Patil as other members.
The said Committee has been entrusted with the responsibility of
formulating and recommending to the Board, a Corporate Social
Responsibility Policy (CSR policy) indicating the activities to be
undertaken by the Company, monitoring the implementation of the
framework CSR Policy and recommending the amount to be spent on CSR
activities.
Internal Complaints Committee
During the year under review, the Internal Complaints Committee was
constituted in accordance with the new legislation the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and no complaints were reported to or resolved by
the Committee for the year ended 31st March, 2014.
Auditors
The Auditors, Messrs. Deloitte Haskins & Sells, Chartered Accountants,
Baroda holds office until the conclusion of the ensuing Annual General
Meeting. The Auditors are eligible for reappointment under Section 139
(1) of the Companies Act, 2013 and have furnished a certifcate to this
effect. The Directors recommend their reappointment as Auditors of the
Company upto the conclusion of the next Annual General Meeting.
Cost Auditors
The Company had fled the Cost Audit Report as per the Companies (Cost
Accounting Records) Rules, 2011 prescribed under Section 209 (1)(d) of
the Companies Act, 1956 pertaining to the financial year 2012-13 before
the due date of fling.
Pursuant to section 148 of the Companies Act, 2013, the Board of
Directors, on the recommendation of the Audit Committee appointed M/s
Shilpa & Company, Cost Accountants, as the Cost Auditors of the Company
for the financial year 2014-15. M/s Shilpa & Company have confirmed that
their appointment, is within the limits of section 139 of the Companies
Act, 2013 and have also certified that they are free from any
disqualifcation specified under sections 141 (3) and 148 (5) of the
Companies Act, 2013.
The Audit Committee has also received a Certifcate from the Cost
Auditor certifying their independence and arm''s length relationship
with the Company.
The Directors recommend the remuneration payable to the Cost Auditors
of the Company for the year 2014-15.
The approval from Shareholders for the remuneration payable to the Cost
Auditors is being sought at the ensuing Annual General Meeting.
Public Deposits & Loans/Advances
During the year, in order to meet working capital requirements, the
Fixed Deposit Scheme was re-launched by the Company pursuant to the
provisions of the Companies (Acceptance of Deposits) Rules, 1975 and
collected Rs.369.15 lacs from public and shareholders of the Company.
In view of the provisions of 74 (1)(b) of the Companies Act, 2013 read
with the Companies (Acceptance of Deposits) Rules, 2014, all the
outstanding Fixed Deposits would required to be repaid within one year
from the commencement of the Act. Accordingly, all deposits due for
repayment during the financial year 2014-15 or those maturing beyond one
year shall be repaid during the Financial Year 2014-15.
Your Company has also not made any loans or advances, which are
required to be disclosed in the Annual Accounts of the Company pursuant
to the Clause 32 of the Listing Agreement.
Energy Conservation and Technology Absorption and Foreign Exchange
Earnings and Outgo
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo as required to be disclosed under
section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board Directors) Rules,
1988 are provided in Annexure II to this Report.
Particulars of Employees
In terms of the provisions of section 217 (2A) of the Companies Act,
1956 read with the Companies (Particulars of Employees) Rules, 1975,
the Company had no employee, who was employed throughout the financial
year and was in receipt of remuneration of not less than Rs. 60,00,000
per annum during the year ended 31st March, 2014 or was employed for a
part of the financial year and was in receipt of remuneration of not
less than Rs. 5,00,000 per month during any part of the year.
Acknowledgements
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and continued support received from
customers, vendors, suppliers, bankers, business associates and
shareholders.
For and On behalf of the Board
Ashok Sharma S. Durgashankar
Executive Director & CEO Director
Place : Mumbai
Dated : 26th May, 2014
Mar 31, 2013
The Directors are pleased to present the 31st Annual Report on
business and operations of your Company alongwith the audited financial
statements and accounts for the year ended 31st March, 2013.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
For the Year For the Year
ended 31st ended 31st
March, 2013 March, 2012
Turnover (Net) 16140.80 12507.31
Other Income 276.02 209.75
16416.82 12717.06
Profit/(Loss) Before Interest, 1035.15 1198.38
Depreciation & Tax
Finance cost 246.37 288.60
Depreciation 254.57 193.64
Profit / (Loss) Before Tax 534.21 716.14
Provision for Tax (50.05)
Profit/(Loss) After Tax 534.21 666.09
Less: Transfer to Debenture 52.00
Redemption Reserve
534.21 614.09
Add: Balance Brought (2390.67) (3004.76)
Forward
Deficit Carried to the Balance (1856.46) (2390.67)
Sheet
* Figures have been regrouped wherever necessary.
Operations and Financial Overview
During the year under review, your Company''s sales turnover was at Rs.
16140.8 lacs (Net) as compared to Rs. 12507.3 lacs (Net) for the
previous year reflecting a growth of 29%. The Profit Before Tax was at
Rs. 534.2 lacs vs. Rs. 716.1 lacs in the previous year. The Profit
After Tax was at Rs. 534.2 lacs vs. Rs. 666.01 lacs in the previous
year.
The year under review has been very challenging for the Company. While
your Company has succeeded in sustaining growth in turnover, the
margins have been affected due to higher raw material cost, rising
inflationary pressures and stagnant or reduced selling prices
determined by State Governments. Inspite of gains in operating
efficiency, quality improvement, yield and operational cost reduction,
the margins have been under acute pressure.
Dividend
Your Directors do not recommend any dividend considering the need to
augment resources for operational purposes.
Management Discussion and Analysis Report
A detailed analysis of the Company''s performance is discussed in the
Management Discussion and Analysis Report, which forms part of this
Annual Report.
Corporate Governance
Your Company believes in sound practices of good Corporate Governance.
Transparency, Accountability and Responsibility are the fundamental
guiding principles for all decisions, transactions and policy matters
of the Company. A Report on Corporate Governance alongwith a
certificate from the Statutory Auditors of the Company regarding
compliance of conditions of Corporate Governance as stipulated under
Clause 49 of the Listing Agreement, forms part of this Annual Report.
Rights Issue of Shares
During theyear under review, the Company allotted 1,03,58,199 Equity
shares at a price of Rs. 40 per share (including a premium of Rs. 30/-
per share) in the ratio of 3 equity shares for every 5 equity shares to
existing shareholders, resulting in total issue size of Rs. 41.43
crores.
Stock Options
During the year under review, 9000 Stock Options got vested in terms of
EPC Industrie Limited Employees Stock Option Scheme - 2010 and were
exercised immediately after vesting. Accordingly, the Company made the
allotment of 9000 Equity Shares on 22nd November, 2012 against these
options exercised by the employees.
Details required to be provided under the Securities and Exchange Board
of India (Employee Stock Option Scheme and Employee Stock Purchase
Scheme) Guidelines, 1999 are set out in Annexure I to this Report.
Share Capital
During the year, due to allotment of 1,03,58,199 equity shares through
the Rights Issue and of 9000 equity shares on exercising of Stock
Options by employees, the total paid up equity share capital of the
Company increased from 1,72,63,665, shares of Rs. 10/- each to
2,76,30,864 equity shares of Rs 10/- each. The said equity shares have
been listed on the Bombay Stock Exchange Limited and they rank pari
passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs.
27,63,08,640 divided into 2,76,30,864 equity shares of Rs. 10/- each as
on 31st March, 2013.
Holding Company
The promoters of the Company i.e. Mahindra and Mahindra Limited hold (M
& M) 1,51,44,433 equity shares which represents 54.81 percent of the
total paid up capital of the Company. Your Company continues to be a
subsidiary company of M & M.
Industrial relations
The industrial relations continue to be peaceful and cordial at all
levels. The Directors wish to place on record their sincere
appreciation of the Company''s employees at all levels. The Company''s
consistent growth is made possible by their hard work solidarity,
co-operation and support.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources/ Industrial
Relations during the year. Safety, Health and Environmental
Performance
Your Company''s commitment towards safety, health and environment is
being continuously enhanced and your Company encourages involvement of
all its employees in activities related to safety, including promotion
of safety standards.
During the year under review, no major accidents occurred. The Safety
Committee regularly reviews the adherence of safety norms. Some of the
programmes undertaken by the Company such as the behaviour based safety
training, Knowledge based fire extinguisher training, Fire fighting
training and safety awareness have resulted in the reduction of number
of accidents.
Various health checkup programmes for employees were regularly
undertaken by the Company during the year. Requirements relating to
various environmental legislations and environment protection have been
duly complied by your Company.
Directors
Mr. S. Durgashankar and Mr. Nikhilesh Panchal, retire by rotation and,
being eligible, have offered themselves for reappointment.
Directors'' Responsibility Statement Pursuant to section 217(2AA) of the
Companies Act, 1956, your Directors, based on the representations
received from the Operating Management, and after due enquiry, confirm
that:
(i) in the preparation of the annual accounts, the applicable
Accounting Standards have been followed;
(ii) they have, in the selection of the accounting policies, consulted
the Statutory Auditors and these have been applied consistently and
reasonable and prudent judgments and estimates have been made so as to
give a true and fair view of the state of affairs of the Company as at
31st March, 2013 and of the profit of the Company for the year ended on
that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities:
(iv) the annual accounts have been prepared on a Going Concern basis.
Auditors
The Auditors, Messrs. Deloitte Haskins & Sells, Chartered Accountants,
Baroda holds office until the conclusion of the ensuing Annual General
Meeting. The Auditors are eligible for reappointment under Section
224(1 B) of the Companies Act, 1956 and have furnished a certificate to
this effect. The Directors recommend their reappointment as Auditors of
the Company upto the conclusion of the next Annual General Meeting.
Cost Auditors
The Company had filed the Certificate of Compliance of Cost Records as
per the Companies (Cost Accounting Records) Rules, 2011 pertaining to
the financial year 2011-12 before the due date of filing.
Pursuant to section 233B of the Companies Act, 1956, the Board of
Directors, on the recommendation of the Audit Committee appointed M/s
Shilpa & Company, Cost Accountants, as the Cost Auditors of the Company
for the financial year 2013 -14. M/s. Shilpa & Company have confirmed
that their appointment, is within the limits of section 224(1 B) of the
Companies Act, 1956 and have also certified that they are free from any
disqualification specified under section 233B(5) read with Section 224
and sub section (3) or sub section (4) of section 226 of the Companies
Act, 1956.
The Audit Committee has also received a Certificate from the Cost
Auditor certifying their independence and arm''s length relationship
with the Company.
Public Deposits & Loans / Advances
During the year, in order to meet working capital requirements, the
Fixed Deposit Scheme was launched by the Company pursuant to the
provisions of the Companies (Acceptance of Deposits) Rules, 1975 and
collected Rs. 1166.68 lacs from public, shareholders and employees of
the Company. Your Company has also not made any loans or advances,
which are required to be disclosed in the Annual Accounts of the
Company pursuant to the Clause 32 of the Listing Agreement.
Energy Conservation and Technology Absorption and Foreign Exchange
Earnings and Outgo
Particulars required to be disclosed under the Companies Act, 1956 read
with the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are set out in Annexure II to this Report.
Particulars of Employees
The Company had no employee, who was employed throughout the financial
year and was in receipt of remuneration of not less than Rs. 60,00,000
per annum during the year ended 31st March, 2013 or was employed for a
part of the financial year and was in receipt of remuneration of not
less than Rs. 5,00,000 per month during any part of the year.
Acknowledgements
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and continued support received from
customers, vendors, suppliers, bankers, business associates and
shareholders.
For and On behalf of the Board
Ashok Sharma S. Durgashankar
Executive
Director & CEO Director
Place : Mumbai
Dated : 2nd May, 2013
Mar 31, 2012
The Directors have pleasure in presenting the 30th Annual Report on
the business and operations of the Company together with audited
financial statements and accounts for the year ended 31st March, 2012.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
For the Year For the Year
ended 31st ended 31st
March, 2012 March, 2011*
Turnover (Net) 12507.31 8680.97
Other Income 209.75 94.24
12717.06 8775.21
Profit/(Loss) Before Interest, 1198.38 897.91
Depreciation & Tax
Finance cost 288.60 486.69
Depreciation 193.64 177.13
Profit / (Loss) Before Tax 716.14 234.09
Provision for Tax (50.05) (90.38)
Profit/(Loss) After Tax 666.09 143.71
Less: Transfer to Deb 52.00 28.75
Redemption Reserve
614.09 114.96
Add: Balance Brought (3004.76) (3119.72)
Forward
Deficit Carried to the (2390.67) (3004.76)
Balance Sheet
* Figures have been regrouped wherever necessary.
Operations and Financial Overview
During the year under review, your Company's sales turnover was at Rs.
125.07 crores (Net) as compared to Rs.86.81 crores (Net) for the
previous year reflecting a growth of 44%. The Profit Before Tax
increased to Rs. 7.16 crores as compared to Rs. 2.34 crores in the
previous year, an increase of over 3 fold over last year. The Profit
After Tax increased to Rs. 6.66 crores as compared to Rs. 1.44 crores
in the previous year, an increase of over 4 fold over last year.
The Company has succeeded in sustaining operating margins largely on
account of productivity enhancements, upgradation of production
facilities, process technology improvements and better working capital
management.
Dividend
Your Directors do not recommend any dividend considering the need to
augment the resources for operational purposes.
Management Discussion and Analysis Report
A detailed analysis of the Company's performance is discussed in the
Management Discussion and Analysis Report, which forms part of this
Annual Report.
Corporate Governance
Your Company believes in sound practices of Good Corporate Governance.
Transparency, Accountability and Responsibility are the fundamental
guiding principles for all decisions, transactions and policy matters
of the Company. A Report on Corporate Governance alongwith a
certificate from the Statutory Auditors of the Company regarding
compliance of conditions of Corporate Governance as stipulated under
Clause 49 of the Listing Agreement, forms part of this Annual Report.
Open Offer & Change in Promoters
In March, 2011, Mahindra & Mahindra Limited (M&M) was issued and
allotted equity shares on preferential basis. Subsequently, in
compliance with SEBI (Substantial Acquisition of Shares and Takeovers)
Regulations, 1997, M&M made an open offer and acquired additional
equity shares from Public Shareholders and upon completion of the open
offer process, M&M became the Promoters of the Company.
Share Capital
During the year, 9500 equity shares were allotted on exercise of Stock
Options and 3900 equity shares were forfeited on account of non-payment
of call money. Consequently, the total paid up equity share capital of
the Company increased from 1,72,58,065 shares of Rs 10/- each to
1,72,63,665 equity shares of Rs 10/- each. The said equity shares have
been listed on the Bombay Stock Exchange Limited and they rank pari
passu with the existing equity shares in all respects.
Accordingly, the Paid-up Share Capital of the Company stood at Rs.
17,26,56,150 divided into 1,72,63,665 equity shares of Rs. 10 each as
at 31st March, 2012.
Rights Issue of Shares
During the year, in order to augment capital expenditure, meet working
capital requirements and for general corporate purposes, the Company
has decided to issue 1,03,58,199 equity shares on a rights basis to the
existing Shareholders of the Company as on 3'd May, 2012 (Record Date)
in the ratio of 3 equity shares for every 5 existing equity shares held
by the Shareholders. The issue is priced at Rs. 40 per share resulting
in total issue size of Rs. 41.43 crores.
Stock Options
During the year under review, 9500 Stock Options got vested in terms of
EPC Industrie Limited Employees Stock Option Scheme - 2010, and were
exercised by them immediately after vesting. Accordingly, the Company
made the allotment of 9500 Equity Shares on 12th December, 2011 against
these options exercised by the employees.
Details required to be provided under the Securities and Exchange Board
of India (Employee Stock Option Scheme and Employee Stock Purchase
Scheme) Guidelines, 1999 are set out in Annexure I to this Report.
Industrial relations
The industrial relations continue to be peaceful and cordial at all
levels. The Directors wish to convey their sincere appreciation to the
Company's employees at all levels, for their continued dedication, hard
work and commitment which has been a significant support for the
valuable contribution by the employees at all levels.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources / Industrial Relations during the year.
Safety, Health and Environmental Performance
Your Company's commitment towards safety, health and environment is
being continuously enhanced and your Company encourages involvement of
all its employees in activities related to safety, including promotion
of safety standards.
During the year under review, a Safety Committee was formed. The theme
of this year was "Zero Accidents". Some of the programmes undertaken by
the Company such as the personal protection equipment provided to
workmen, safety awareness programmes, declaration of entire facilities
as "tobacco free zone", conduct of mock/test drills for improving
overall awareness, observation of National Safety Week, etc. have
resulted in the reduction of number of reported accidents.
The various health check ups programmes for employees were regularly
undertaken by the Company.
The requirements relating to various environmental legislations and
environment protection have been duly complied by your Company.
Directors
During the year under review, Mr. K. L. Khanna, Mr. Jayendra Shah and
Mr. Bhoopendra K. Sharma have resigned from the Board. The Board places
on record its gratitude and appreciation of the contribution made by
them during their tenure as Directors of the Company. The Board further
wishes to place on record that under the leadership of Mr. K L Khanna
as Chairman and Managing Director, the Company witnessed a successful
turnaround with the considerable growth.
Mr. Vinayak Patil and Mr. Anand Daga retire by rotation and, being
eligible, offer themselves for re-appointment.
Directors' Responsibility Statement
Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors
based on the representations received from the Operating Management,
and after due enquiry, confirm that:
(i) in the preparation of the annual accounts, the applicable
Accounting Standards have been followed;
(ii) they have, in the selection of the accounting policies, consulted
the Statutory Auditors and these have been applied consistently and
reasonable and prudent judgments and estimates have been made so as to
give a true and fair view of the state of affairs of the Company as at
31st March, 2012 and of the profit of the Company for the year ended on
that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) the annual accounts have been prepared on a Going Concern basis.
Auditors
Messrs. Deloitte Haskins & Sells, Chartered Accountants, Baroda hold
office until the conclusion of the ensuing Annual General Meeting.
Messrs. Deloitte Haskins & Sells are eligible for reappointment under
Section 224(1 B) of the Companies Act, 1956 and have furnished a
certificate to this effect. The Directors recommend their reappointment
as Auditors of the Company upto the conclusion of the next Annual
General Meeting.
Public Deposits & Loans / Advances
The Company has not accepted any deposits from the public or its
employees during the year under review. Your Company has also not made
any loans or advances, which are required to be disclosed in the Annual
Accounts of the Company, pursuant to Clause 32 of the Listing
Agreement.
Energy Conservation and Technology Absorption and Foreign Exchange
Earnings and Outgo
Particulars required to be disclosed under the Companies Act, 1956 read
with the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are set out in Annexure II to this Report.
Particulars of Employees
The Company had no employee, who was employed throughout the Financial
Year and was in receipt of remuneration of not less than Rs. 60,00,000
per annum during the year ended 31st March, 2012 or was employed for a
part of the Financial year and was in receipt of remuneration of not
less than Rs. 5,00,000 per month during any part of the year.
Acknowledgements
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and continued support received from
customers, suppliers, bankers, business associates and shareholders.
For and On behalf of the Board
Ashok Sharma Vinayak Patil
Executive Director & CEO Director
Place : Mumbai
Dated : 2nd May, 2012
Mar 31, 2011
Dear Members,
The Directors have pleasure in presenting their Twenty Ninth Annual
Report and Audited Accounts of your Company for the year ended 31st
March, 2011.
Financial Highlights
(Rs. in lacs)
For the year For the year
ended 31st ended 31st
March, 2011 March, 2010
Turnover (Net) 8669.15 7244.42
Other Income 101.23 124.58
8770.38 7369.00
Profit/(Loss) Before Interest, 923.94 746.56
Depreciation & Tax
Interest 481.81 443.71
Depreciation 177.14 162.92
Profit/(Loss) Before Prior 264.99 139.93
Period items
Prior Period Income/ (30.90) (3.62)
(Expenses)
Profit /(Loss) Before Tax 234.09 136.31
Provision for Tax (90.38) 41.13
Profit /(Loss) After Tax 143.71 95.18
Less Transfer to Debt 28.75 19.25
Redemption Reserve
114.96 75.93
Add: Balance Brought (3119.72) (3195.65)
Forward
Deficit Carried to the (3004.76) (3119.72)
Balance Sheet
Operations and Financial Overview
During the year under review, your Company's operations were partially
affected due to shortage of Working Capital, which restricted the sales
turnover for the year to Rs.86.69 crores (Net). This year's sales
turnover reflects a rise of 20% over the previous year's Sales of Rs.
72.44 crores (Net). The Profit Before Tax has increased from Rs. 1.36
crores for the previous year to Rs. 2.34 crores for the current year.
Over the last three years, your Company has increasingly concentrated
on supply of Micro Irrigation System (MIS) consisting of Drip and
Sprinklers. During the year under review, MIS Sales covered under the
Scheme of Central and State Subsidies, has been converted by the
Central Government into a 'National Mission on Micro Irrigation'. The
Ministry of Agriculture of the Central Government has issued Revised
Guidelines in this regard. It is expected that this change would give
further impetus to the Government of India's programmes to encourage
the efficient use of water
resources through MIS in the Country. Your Company operates all over
India and more particularly in the Mega Projects of Andhra Pradesh
Micro Irrigation Project (APMIP) and Gujarat Green Revolution Company
Limited (GGRCL). With the active support and investment of Mahindra &
Mahindra Limited into your Company, your Company expects to play a very
important role in helping the Farmer Community to improve the yields
and manage the water resources more meaningfully.
The integration of synergies of the Company and the Mahindra Group
would create an extremely potent marketing force, which would help the
Company to achieve faster growth.
Dividend
Your Directors do not recommend any dividend considering the need to
augment the resources for operational purposes.
Management Discussion and Analysis Report
A detailed analysis of the Company's performance is discussed in the
Management Discussion and Analysis Report which forms part of this
Annual Report.
Corporate Governance
Your Company believes in sound practices of Good Corporate Governance.
Transparency, Accountability and Responsibility are the fundamental
guiding principles for all decisions, transactions and policy matters
of the Company.
A Report on Corporate Governance alongwith a Certificate from the
Statutory Auditors of the Company regarding compliance of conditions of
Corporate Governance as stipulated under Clause 49 of the Listing
Agreement forms part of this Annual Report.
Share Capital
Issue of Shares on Preferential basis
In order to augment your Company's funding requirements for debt
reduction, capital expenditure, long term working capital requirements
and for general corporate purposes, the Company has, pursuant to the
approval of the Shareholders obtained at the Extra Ordinary General
Meeting held on 9th March, 2011, allotted 65,58,065 Equity Shares of
Rs. 10 each at a premium of Rs. 56.10 aggregating Rs. 43.35 crores,
constituting 38% of the post issue paid up equity share capital to
Mahindra & Mahindra Limited ("M&M") as per the provisions of Securities
and Exchange Board of India (Issue of Capital and Disclosure
Requirements) Regulations, 2009.
Post allotment of Equity Shares as aforesaid, the Issued, Subscribed
and Paid up Equity Share Capital of the Company stands at Rs. 1725.81
lacs comprising of 1,72,58,065 Equity Shares of Rs. 10 each ("Emerging
Voting Capital").
Pursuant to Regulations 10 and 12 of Securities and Exchange Board of
India (Substantial Acquisition of Shares and Takeovers) Regulations,
1997 as amended, M&M has made an Open Offer to the Equity Shareholders
of the Company to acquire upto 34,51,613 fully paid up equity shares of
the face value of Rs.10 each, representing 20% of the Emerging Voting
Capital of the Company. The Open Offer commenced on 21st July, 2011 and
would close on 9th August, 2011. Upon completion of the Open Offer
formalities, M&M and the existing Promoters of the Company would be
classified as Promoters and Public Shareholders respectively.
Finance
During the year under review, the liquidity position of your Company
was not very satisfactory. However, with the allotment of Shares to M&M
under Preferential Issue, your Company would be meeting its need for
capital expenditure as well as long term working capital requirements.
Part of the proceeds of Preferential Issue have been utilized by your
Company for redemption of Optionally Convertible Cumulative Debentures
amounting to Rs. 13.00 crores out of outstanding of Rs.17.00 crores
during the first quarter of the Financial Year 2011-12.
Stock Options
In pursuance of the approval of the Members at the previous Annual
General Meeting held on 21st July, 2010, your Company has formulated
and implemented Employee Stock Option Scheme (the Scheme) for grant of
Employee Stock Options to certain employees and Non-executive Directors
of the Company.
The Compensation Committee of the Board of Directors has been
constituted and is entrusted with the responsibility of administering
the Scheme. The Committee has granted 60,500 Stock Options during the
year under review, comprising about 0.35% of the current paid up
capital of the Company.
Details required to be provided under the Securities and Exchange Board
of India (Employee Stock Option Scheme and Employee Stock Purchase
Scheme) Guidelines, 1999 are set out in Annexure I to this Report.
Industrial relations
The industrial relations continue to be peaceful and cordial at all
levels. The Directors are pleased to record their appreciation for the
valuable contribution by the employees at all levels.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources / Industrial Relations during the year.
Safety, Health and Environmental Performance
Your Company's commitment towards safety, health and environment is
being continuously enhanced and your Company encourages involvement of
all its employees in activities related to safety, including promotion
of safety standards.
The requirements relating to various environmental legislations and
environment protection have been duly complied by your Company.
Directors
Mr. Ashok Sharma, Mr. S. Durgashankar, Mr. Nikhilesh Panchal and Mr.
Anand Daga have been appointed as Additional Directors at the Meeting
of the Board of Directors of the Company held on 5th August, 2011. They
hold Office upto the date of the ensuing Annual General Meeting.
The Company has received Notices from Members under section 257 of the
Companies Act, 1956 signifying the intention to propose Mr. Ashok
Sharma, Mr. S. Durgashankar, Mr. Nikhilesh Panchal and Mr. Anand Daga
as candidates for the Office of Director of the Company at the ensuing
Annual General Meeting.
Mr. Jayendra Shah retires by rotation and being eligible, offers
himself for re-appointment.
Directors' Responsibility Statement
Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors
based on the representations received from the Operating Management,
and after due enquiry, confirm that:
(i) in the preparation of the annual accounts, the Applicable
Accounting standards have been followed;
(ii) they have, in the selection of the accounting policies, consulted
the Statutory Auditors and these have been applied consistently and
reasonable and prudent judgments and estimates have been made so as to
give a true and fair view of the state of affairs of the Company as at
31st March, 2011 and of the profit of the Company for the year ended on
that date;
(iii) proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) the annual accounts have been prepared on a Going Concern Basis.
Auditors
Messrs Desai Associates, Chartered Accountants, Mumbai, the existing
Statutory Auditors have expressed their unwillingness to seek
re-appointment.
Your Directors have placed on record their sincere appreciation towards
the services rendered by Messrs Desai Associates, Chartered
Accountants, as Statutory Auditors of your Company.
The Company has received a Special Notice from a Member of the Company,
in terms of the provisions of the Companies Act, 1956, signifying the
intention to propose the appointment of Messrs Deloitte Haskins &
Sells, Chartered Accountants, Mumbai as the Statutory Auditors of the
Company from the conclusion of the ensuing Annual General Meeting till
the conclusion of the next Annual General Meeting. Messrs Deloitte
Haskins & Sells, Chartered Accountants, Mumbai have also expressed
their willingness to act as Statutory Auditors of the Company, if
appointed, and have further confirmed that the said appointment would
be in conformity with the provisions of section 224(1B) of the
Companies Act, 1956.
Public Deposits & Loans / Advances
The Company has not accepted any deposits from the public or its
employees during the year under review. Your Company has also not made
any loans or advances, which are required to be disclosed in the Annual
Accounts of the Company pursuant to Clause 32 of the Listing Agreement.
Current Year
During the First Quarter of the Financial Year 2011-12, your Company
has recorded a sales turnover of Rs. 26.70 crores as compared to Rs.
23.48 crores of the First Quarter of the previous year. The Profit
Before Tax and the Profit After Tax was at Rs. 2.01 crores and Rs. 1.37
crores respectively as compared to Rs.1.10 crores and Rs. 0.82 crores
in the First Quarter of the previous year.
Intensifying efforts to penetrate in the domestic and overseas markets,
increase its market share and introducing new generation micro
irrigation technology are the key challenges before your Company. Your
Company is confident of meeting these challenges in future.
Energy Conservation and Technology Absorption and Foreign Exchange
Earnings and Outgo
Particulars required to be disclosed under the Companies Act, 1956 read
with the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are set out in Annexure II to this Report.
Particulars of Employees
The Company had no employee, who was employed throughout the Financial
Year and was in receipt of remuneration of not less than Rs. 60,00,000
per annum during the year ended 31st March, 2011, or was employed for a
part of the Financial year and was in receipt of remuneration of not
less than Rs. 5,00,000 per month during any part of the year.
Acknowledgement
Your Directors take this opportunity to place on record their sincere
appreciation for the co-operation and continued support received from
customers, suppliers, bankers, business associates and shareholders.
For and On behalf of the Board
K L Khanna
Chairman & Managing Director
Place : Nashik
Dated : 5th August, 2011
Mar 31, 2010
The Directors have pleasure in presenting the Twenty Eighth Annual
Report and Statement of Accounts for the year ended 31st March, 2010.
FINANCIAL RESULTS
(Rs. in lacs)
2009-10 2008-09
Turnover 7521.11 6230.60
Other Income 124.75 121.87
7645.86 6352.47
Profit/(Loss) Before Interest, 746.56 198.34
Depreciation and Tax
Interest 443.71 369.65
Depreciation 162.92 144.26
Profit (Loss) Before Prior
Period items 139.93 (315.57)
Prior Period Items (3.62) (4.48)
Profit/(Loss) Before Tax 136.31 (320.05)
Provision for Tax 41.13 168.71
Profit/(Loss) After Tax 95.18 (151.34)
Transfer to Debenture
Redemption Reserve Account 19.25 -
OPERATIONS AND OVERVIEW
The Sales turnover for the year under review was Rs.75.21 Crores as
compared to Rs. 62.31 Crores for the previous year. The Company
continued to face difficulties in raising working capital. However, the
improvement in opera- tions can be directly attributable to improvement
in product mix. The Company has made profits in all four quarters for
the year under review and has turned around into profits.
The Company has plans to further increase its installed capac- ity in
Drip Irrigation in the coming year. It continues to work successfully
in the Mega Projects of Andhra Pradesh Micro irrigation Project (APMIP)
and Gujarat Green Revolution Com- pany Limited (GGRCL). Its business
coverage is pan India.
INSURANCE
Buildings, Plant and Machinery and other Fixed Assets as well as
Inventories of the Company stand sufficiently insured.
DIRECTORS
In accordance with Article 123 of the Articles of Association Mr.
Vinayak Patil retire by rotation and being eligible, offers himself for
reappointment at the ensuing Annual General Meeting.
CORPORATE GOVERNANCE
The Company has been taking steps to attain higher levels of
transparency, accountability and equity. Efforts are made not only to
comply with the Regulatory requirements, but also by being responsive
to the requirements of all concerned.
As per the Listing Agreement, with the Stock Exchange, a Management
Discussion and Analysis, a Report on Corporate Governance together with
a Certificate from the Auditors of the Company regarding compliance of
conditions of Corpo- rate Governance is attached and forms part of this
Report.
PREFERENTIAL ISSUE OF SHARES
During the year under review, the Company has allotted 12,00,000 Equity
Shares of Rs.10 each at a premium of Rs. 40/- aggregating to Rs. 6.00
crores to the Promoters and the Overseas Investors in accordance with
the provisions of SEBI (Issue of Capital and Disclosure Requirements)
Regula- tions, 2009 to utilize the proceeds to meet working capital
requirements of the Company.
EMPLOYEE STOCK OPTION SCHEME (ESOS) The Board of Directors has proposed
the Employee Stock Option Scheme (ESOS) for the eligible employees
including Independent Director and key management personnel of the
Company. The same would be placed for Shareholders approval at the
ensuing Annual General Meeting.
AUDITORS
M/s Mukadam & Associates - Chartered Accountants merged with Desai
Associates - Chartered Accountants, Mumbai w.e.f 30th December, 2009.
M/s. Desai Associates - Chartered Ac- countants hold office until the
conclusion of the ensuing Annual General Meeting. M/s. Desai Associates
- Chartered Accountants are eligible for reappointment under Section
224(1 B) of the Companies Act, 1956 and have furnished a certificate to
this effect. The Directors recommend their reap- pointment as Auditors
of the Company upto the conclusion of the next Annual General Meeting.
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION, RESEARCH &
DEVELOPMENT
Particulars pursuant to Section 217(1) (e) of the Companies Act, 1956
read with the Companies (Disclosure of Particulars of the Report of the
Board of Directors) Rules, 1988 are as follows:
CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION
The Company continues to give priority to the conservation of energy
and technology upgradation. To conserve energy and reduce energy cost,
various initiatives were taken during the year. Some of these are given
below:
Cycle time improvement resulting Into increase in productivity.
Power factor is being maintained at unity. Improvement in productivity
and savings in power consumption due to in-house technological
innovations. Development of moulded fittings resulting in savings in
man power, machine utilization, cost reduction and product quality.
FORM-A
A. POWER AND FUEL CONSUMPTION
2009-10 2008-09
1. Electricity Purchased
(i) Units (Kwh) (Lacs) 45.28 39.71
(ii) Amount (Rs. Lacs) 240.08 193.53
(iii) Average Rate(Rs./Unit) 5.30 4.87
B. CONSUMPTION
(Units/MT Production) 1087.00 1064.00
PARTICULARS OF EMPLOYEES
Information in accordance with the provisions of Section 217 (2A) of
the Companies Act, 1956, read with the Companies (Particulars of
Employees) Rules, 1975, as amended, regard- ing employees is given in
"Annexure A" to the Directors Report.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 217 (2AA) of the Companies Act, 1956, the Directors
would like to state that -
(a) in the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed.
(b) the Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Com- pany at the end of the financial year and of the
Profit of the Company of the year under review.
(c) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguard- ing the assets of the Company and
for preventing and detecting fraud and other irregularities.
(d) the Directors have prepared the annual accounts on a Going
Concern basis.
INDUSTRIAL RELATIONS
The industrial relations continue to be peaceful and cordial at all
levels. The Directors are pleased to record their appre- ciation of the
services rendered by the employees at all levels.
ACKNOWLEDGEMENT
Your Directors take this opportunity to place on record their gratitude
for the co-operation and continued support received from workers
union, customers, suppliers, bankers, business associates and
shareholders.
For and On behalf of the Board
K L Khanna
Nashik, April 29, 2010 Chairman & Managing Director
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