Directors Report of Fineotex Chemical Ltd.
Mar 31, 2022
We take pleasure in presenting the Nineteenth Annual Report, together with the Audited Financial Statements of the Company for the Financial Year ended 31st March 2022.
FY 2021-22 has been a milestone year for Fineotex Chemical. We saw the turnover doubling over FY2020-21 signifying the increase in our market share. This is the result of persistent policy pursued by the Company to provide customised business solutions to our customers and this has led to an increase in our product basket while simultaneously increasing our market share. This high growth category will result in higher margins. The performance reiterates the essence of our mission and our capabilities to be an effective customized solution provider along with traditional speciality chemicals.
Our strong performance also demonstrated our ability to adopt to any changes in the economy due to natural and geo-political causes.
|
(Rs. in Lakhs) |
||||
|
Standalone |
Consolidated |
|||
|
Year ended 31-03-2022 |
Year ended 31-03-2021 |
Year ended 31-03-2022 |
Year ended 31-03-2021 |
|
|
Total Income |
25,622 |
14,500 |
37,375 |
23,600 |
|
Less: Expenditure |
19,946 |
10,000 |
30,046 |
18,014 |
|
Profits before Tax |
5,676 |
4,500 |
7,329 |
5,586 |
|
Less: Income Tax Expense |
1,278 |
902 |
1,640 |
1,131 |
|
Profit after Tax |
4,398 |
3,598 |
5,689 |
4,456 |
|
Other Comprehensive Income (net of tax) |
(5) |
1 |
(5) |
1 |
|
Total Comprehensive Income |
4,393 |
3,599 |
5,684 |
4456 |
|
Attributable to |
||||
|
a. Owners of the Company |
4,393 |
3,599 |
5,512 |
4,259 |
|
b. Non Controlling Interest |
Nil |
Nil |
172 |
197 |
The above data has been extracted from the Audited Standalone and Consolidated Financial Statements prepared in accordance with the Indian Accounting Standards (Ind AS), as notified under section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards Rules 2015) and the relevant provisions of the Act, as applicable.
The Board has proposed a dividend of Rs. 0.40 (Previous year Rs. 0.30) per equity share of Rs. 2/- each, at a total payout of Rs. 443 lakhs. The dividend, after approval by the shareholders and
ratification at the Annual General Meeting, will be paid to the eligible shareholders within the stipulated period. . The dividend will attract income tax. Members are requested to update the Permanent Account Numbers (PAN) and bank details with their depository participant or with the Companyâs Registrar and Transfer Agents. In case of non-availability of PAN, tax at higher rates will be deducted as prescribed in this regard.
Further, as per Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âSEBI Listing Regulationsâ), the top 1000 listed entities based on market capitalization are required to formulate a Dividend Distribution Policy. Accordingly, your Company has formulated its Dividend Distribution Policy, which is available on the Companyâs website at http://3.108.21.113/wp-content/uploads/2021/08/Dividend-Distribution-Policy.pdf.
The turnover has shown a healthy rise during the year and we expect the trend to continue in future too. The Cleaning and Hygiene products have shown a steady growth and is expected to accelerate despite the steep decline of pandemic.
The Companyâs planned expansion of production facilities has gone on steam during the year from 9th November, 2021 in Ambernath in Thane District of Maharashtra. It has started making a significant contribution to the Companyâs top line. State-of-the-art facility will ensure our commitment to environmental sustainability. It can contribute substantially to meet the requirements as they arise.
During the year, we have entered into a strategic alliance with HealthGuard®, a privately owned Australian company. It is a global leader in tailored non-invasive healthcare products such as Antimicrobial, Antiviral, Anti Insects Finishing and has a dedicated research and development facility to manufacture safe innovative biotech solutions for a wide range of products. . FCL Group has secured an exclusive global marketing and sales channel partnership. With this tie-up, Fineotex will add to its portfolio the much-required metal-free product range to its global customers with all the required global certifications.
It has also entered into an arrangement with Eurodye CTC, Belgium to commercialize speciality chemicals for pre-treatment and dyeing processes, for providing performance enhancing solutions for its customers. Their deep four-decade-long experience in research and development, has enabled us to bring their cutting-edge and specialised products to the Indian market. The association, will also benefit us from technology transfers apart from the channel partnership. Eurodye-CTC will also be benefitted by offering its existing customers our specialised technical solutions services.
The Company achieved a turnover of Rs. 25,008 lakhs (Previous Year (PY) Rs. 12,948 lakhs) on Standalone basis and Rs. 36,823 Lakhs (PY 21,851 lakhs) on Consolidated basis. This growth is expected to sustain itself and the coming tear is also expected to show a heathy growth in the top line.
The Company believes in meeting the challenges head-on. Despite supply chain disruptions due to global geo-political changes, we have managed to ensure adequate availability of raw materials with sufficient inventories and thus, smooth production line. The high inventories will be back to normal in the first quarter. Our financial jurisprudence has ensured continuous production, free from any disruption and adequate control on the receivables despite tight market conditions.
There has been no change in the paid up capital of the Company. The Share Capital of the Company, at the beginning of the year as well as at the close of the year on 31st March 2022 stands at Rs. 2,214.97 lakhs divided into 11,07,48,420 equity shares of Rs. 2/- each. There has been no change in the outstanding share capital during the year.
6. EMPLOYEES SHARE OPTION SCHEME 2020
The Company, at the 17th Annual General Meeting held on 29th September, 2020, had taken the approval of the shareholders for its Employees Stock Option Scheme FCL-ESOP-2020, The shareholders had also granted powers to the Board of the Company to determine and grant options to its own employees company as well as of its subsidiaries.
During the year the Company has granted options to various eligible employees across all levels depending on their grades, seniority and other factors on the recommendations of the Nomination and Remuneration Committee of the Company. The vesting period is two and half hears and will vest on August 2024.
Disclosure pursuant to the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 for the year ended March 31,2022 is available at the website of the Company at https://bit.ly/3PfWtL9.
During the year under review, âno stock options were exercised under the terms of the âFCL - Employees Stock Option Plan, 2020 (FCL-ESOP 2020)â.
The certificate from the Secretarial Auditors of the Company stating that the Schemes have been implemented in accordance with the SEBI Regulations would be placed at the ensuing Annual General Meeting for inspection by members.
The details and performance of the subsidiary companies is provided below:
Fineotex Malaysia Limited (FML), a Limited Company, was incorporated in a free trade zone in Labaun, Malaysia in 2011. FML in turn has controlling interest in 3 other companies in Malaysia that have established manufacturing and trading activities. FML has increased their stake in these subsidiaries. These Companies are BT Biotex Sdn Bhd, BT Chemicals Sdn Bhd and Rovatex Sdn Bhd. The synergy of the businesses has helped all the companies. BT Chemicals Sdn Bhd qualifies as a material subsidiary as per
the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. Also refer the para 20 on Material Subsidiary in Corporate Governance Report which forms part of this report.
On 10th November, 2020, FML incorporated a wholly owned subsidiary -BT Biotex Limited, UAE with an initial investment of US$ 10,000.
Fineotex Specialties FZE was incorporated in the Region of UAE on 25th January 2015 and operates in a free zone in UAE. It is renamed as Fineotex Biotex Healthguard FZE during the year after the strategic arrangement with HealthGuard during the year.
The Company incorporated a wholly owned subsidiary named Fineotex Specialities Private Limited on 5th September, 2020 with an investment of Rs. 100 lakhs to the Equity Capital.
Manya Manufacturing India Private Limited is the Indian subsidiary. It is not a material subsidiary as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013.
A statement containing the salient features of the financial statements of subsidiary companies in Form AOC-1 is attached to the Accounts.
The separate audited financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of the Annual General Meeting.
8. FINANCE AND CAPITAL EXPENDITURE
The Companyâs finance position continues to be robust. During the year under review, the cash generation from operations reflect a positive contribution. This has been the Companyâs philosophy throughout and can be vouched over the years. The Company is a zero debt company. The borrowings are taken for short term requirements so that the investment portfolio is not abruptly disturbed. The Company has made substantial investment of Rs. 1500.18 lakhs to increase its manufacturing activities and the same are financed from internal resources which were held as investments which is reflected in the Cash Generated from investing activities of the Cash Flow statement for the year ended 31st March, 2022.
9. MAJOR CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION AFTER THE YEAR END AND TILL THE DATE OF THIS REPORT
There have been no significant changes / significant orders passed by the regulators or appellate authorities or commitments affecting the financial position of the Company which has occurred after the Balance Sheet date and the date of adoption of
the Board Report that may affect the going concern status of the Companyâs future operations.
10. INTERNAL FINANCIAL CONTROLS
The Internal Control System is reviewed on a continuous basis in light of the changed circumstances and way of doing business due to the changing systems and procedures. Based on the recommendary and statutory directions of the Government, the Company had to revisit the controls time and again as business necessity. Consequent to the amendment to the Schedule III of the Companies Act 2013 and reporting requirements of CARO 2020 the Board has looked into the controls and brought in line to comply with the Act. The management is also in touch with stakeholders, experts and auditors. Necessary provision has been made on the basis of such interaction.
11. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company along with its subsidiaries - both foreign and Indian - for the year ended 31st March, 2022 form part of this Annual Report. The same are prepared as per the applicable Indian Accounting Standards (Ind AS) as well as the revised Schedule III of the Companies Act, 2013 as notified under section 133 of that Act, read with Companies (Indian Accounting Standards Rules) 2015 and the relevant provisions of the Act, as applicable.
12. PUBLIC DEPOSITS, LOANS AND ADVANCES
The Company has not accepted any deposits from the public or shareholders during the year or in the previous year. Security Deposits have been taken from customers as security against dues for goods sold to them and are not in the opinion of the Board in the nature of Public Deposits. Rent Deposit given to Subsidiary Company is disclosed in the financial statements as required under the Indian Accounting Standards (Ind AS) and Listing Agreements.
13. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS.
The Particulars of loans, guarantees and investments under Section 186 of the Companies Act, 2013 as at the end of the Financial Year 2021-22 are provided in the Standalone financial statements and the same are also given in Annexure â1â forming part of this report.
14. RELATED PARTY TRANSACTIONS / CONTRACTS
During the year, the Securities and Exchange Board of India (SEBI) has widened the definition and the scope of Related Party Transactions. The procedure of approval of the Audit Committee and the shareholders have undergone changes. All Related Party transactions entered into during the year were mostly on armâs length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.
All Related Party Transactions are approved by the Audit Committee. Prior omnibus approval is obtained from the Audit Committee in respect of transactions which are repetitive in nature.
The shareholders have also given approval to these contracts and transactions at the 16th Annual General Meeting of the Company. Subsequently some of these were amended in the 17th and 18th Annual General meetings as explained therein. Though these are for transactions upto 2024, as per the new requirement, fresh approval of the shareholders will be required from the shareholders for next yearâs transactions.
Details of related party transactions are given in Annexure â2â giving the details as per AOC-2.
The policy on Related Party Transactions as approved by the Board is available on the website of the Company www.fineotex. com and may be accessed through the web link http://fineotex. com/Investor-Relation.aspx.
Mrs. Aarti Jhunjhunwala is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, she offers herself for re-appointment. She is related to the Whole-time Directors of the Company and therefore a Non-Independent Director liable to retire by rotation and being eligible, she offers herself for reappointment. The details about her are attached separately.
As per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 as amended, your Company is required to appoint its Independent Director on the Board of the material subsidiary. As per the said regulation, BT Chemicals Sdn Bhd is a material subsidiary, as it contributed more than 10% to the Consolidated Income of the Group in 2018-19. The status of this subsidiary is âPrivate Limitedâ Company under Malaysian Law. The law requires the Director to obtain a work permit from the Malaysian Government and there is also the reluctance of minority shareholders for such an appointment. The Company has appointed Mr. Alok Dhanuka as an Independent Director on the Board of FML which is the holding Company of BT Chemicals Sdn Bhd. FML is incorporated in the âExport Zoneâ in Malaysia where the restrictions for Non-Malaysians is lesser (Also refer Annexure 5 and Corporate Governance Certificate issued by Statutory Auditor of the Company).
Dr. Sunil Waghmare and Dr. Anand Patwardhan are Independent Directors for a period of 5 years at the Board Meeting held on 31st October 2020. The Shareholders at the 18th Annual General Meeting held on 16th July, 2021 confirmed their appointment.
Dr. Anand Patwardhan resigned as an Independent Director with effect from 16th May, 2022 due to his pre-occuaption and relocation to Bhubhaneswar as in-charge of the Bhubhaneshwar Division of the Institute of Chemical Technology. The Board records its deep gratitude and appreciation for the services rendered to the Company and Board.
The Board of Directors of the Company met six times during the financial year. The details of various Board Meetings and meetings of the Committees are provided in the Corporate Governance Report given in Annexure âCâ. The details about the remuneration paid to Directors and other particulars as required by the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are in Annexure â3â.
Key Managerial Personnel (KMP)
The following have been designated as the Key Managerial Personnel of the Company as per the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
a) Mr. Surendrakumar Tibrewala - Chairman & Managing Director
b) Mr. Sanjay Tibrewala - Whole-Time Director & Chief Financial Officer
c) Mr. Hemant Auti - Company Secretary
d) Particulars of Employees and related disclosures
Mr. Surendrakumar Tibrewla, Chaimran and Managing Director and Mr. Sanjay Tibrewala Executive Director and CFO who were employed throughout the year and was received a gross remuneration of over Rs. 102 Lakhs.
None of the other employees who were employed throughout the financial year were in receipt of remuneration of more than Rs. 102 Lakhs during the year ended 31st March, 2022, nor was their remuneration in excess of that drawn by the Managing Director or Whole-time Director.
There were no employees employed for any part of the financial year 31st March 2022 in receipt of remuneration more than Rs. 8,50,000 per month. No employee drew remuneration in excess of that of Managing Director and Executive Director.
Disclosure with respect to the remuneration of Directors, KMPs and employees as required under section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure â3â to this Report.
18. DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(7) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
a. POLICY RELATING TO DIRECTORS, KMP AND OTHER EMPLOYEES
Your Company has adopted the Nomination and Remuneration Policy on the principles of consistency and transparency. It includes criteria for determining
qualifications, positive attributes and independence of a Director. The Remuneration Policy is set out in Annexure â4â to the Directorâs Report and is also available on the Companyâs website.
b. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
In compliance with the requirements of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company circulates certain notes to familiarise the Independent Directors and also the operations and developments within the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, entitlement of sitting fees to Independent Directors etc. https://fineotex.com/ fcl-familiarisation-programme.aspx. The Company also circulates explanatory notes on amendments made to various applicable laws and regulations (Web Link- https:// fineotex.com/fcl-familiarisation-programme.aspx)
Pursuant to the provision of the Companies Act 2013 and Regulations 17 (10) and 25(4)(a) of the Listing Regulations, the Nomination and Remuneration Committee formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of Directors of the Company, including Independent Directors. The performance evaluation of the Audit Committee was also carried out.
The Evaluation of Board and its findings were shared by the Chairman individually with Board Members. The Directors expressed their satisfaction with the evaluation process.
M/s. ASL & Co., Chartered Accountants (Firm Registration No. 101921W), were appointed as statutory auditors of the Company, at the 16th Annual General Meeting for a period of 5 years - i.e. till the conclusion of 21st Annual General Meeting to be held in 2024.
The Audit Committee and the Board of Directors have recommended a remuneration of Rs. 4,50,000/- p.a. excluding taxes and out of pocket expenses fixed by the Audit Committee and Board of Directors of the Company. This is the same as last year.
Further, the Auditorsâ Report for the financial year ended 31st March, 2022 on the financial statements of the Company is a part of this Annual Report. The Auditorsâ Report for the financial year ended 31st March, 2022 does not contain any qualification, reservation or adverse remark.
20. COST ACCOUNTING RECORDS AND COST AUDIT
In pursuance of Section 148 of the Companies Act, 2013 and Rule 14 of the Companies (Audit and Auditors) Rules, 2014, your Company, as specified in item (B) of Rule 3, had to get its cost records audited for the financial year 2022-23 in accordance
with these rules as the annual turnover of the Company from all its products and services during 2021-22 had exceeded rupees one hundred crore or more and the aggregate turnover of the individual product or products or service or services for which cost records are required to be maintained under rule 3 is rupees thirty five crore or more.
The Board had appointed M/s V J Talati & Co., Cost Accountants, for the conduct of the Cost Audit of the Companyâs manufacturing units. The shareholders have approved their appointment at the last Annual General Meeting and fixed their remuneration. They will submit the report in due course. This year too, Cost Audit is mandatory and hence M/s V J Talati & Co. are proposed to be appointed as mentioned in the Notice to the 19th Annual General Meeting.
As per Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 it is mandatory for the Listed Company, like yours, to have secretarial records audited. The Board of Directors had appointed HSPN & Associates LLP, Company Secretaries as Secretarial Auditors for 2022-23.
The Secretarial Audit Report is annexed herewith as Annexure â5â.
The Secretarial Audit Report for 2021-22 does not contain any qualification, reservation or adverse remark.
22. CORPORATE SOCIAL RESPONSIBILITY
As per the provisions of Section 135 of the Companies Act 2013, your Company has to spend 2% of its profits as computed under the Companies (Corporate Social Responsibility) Rules 2014 towards the activities specified by the Government of India. The provisions in this regard have been amended and are applicable since the current year. The Company was discharging this obligation by donating the amounts to the trusts which carry on these specified activities. As per the amendments, these trusts should also register with the Ministry of Corporate Affairs, Government of India. The Company had to spend Rs. 55.53 lakhs. The Company has fulfilled its obligation by spending Rs. 50.00 lakhs and adjusting the balance liability against the excess of Rs. 7.79 lakhs last year. Details of CSR is annexed herewith as Annexure â6â.
As per Regulation 21 of (Listing Obligation and Disclosure Requirements) Regulation, 2015, the provisions regarding Risk Management Committee. The management of the Company determines various aspects so as to be able to minimize the risk in all spheres of the Companyâs business from finance, human resources to business strategy, growth and stability. The Board has formed the Committee during the year. The Committee met twice in a year i.e. on 30th October, 2021 and 17th January, 2022.
The details pertaining to the composition of the Audit Committee
are included in the Corporate Governance Report which forms a part of this Report. The Committee met 4 times during the year i.e. on 22nd April, 2021; 23rd July, 2021; 30th October, 2021; 17th January, 2022.
25. WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has established a vigil mechanism for Directors and employees to report their genuine concerns, details of which have been given in the Corporate Governance Report annexed to this Report. The copy of the Policy is available on the website of the Company and may be accessed through the web link http:// fineotex.com/InvestorRelation.aspx#InvestorRelation.
No complaints/suggestions were received during the year
The Company has total 247 employees out of which 186 are permanent employees and 61 are contract worker at the year end. From the total permanent employees, over 17% are women.We consider our employees as our most valuable asset and have been working towards keeping them engaged and inspired. ESOP have been grated during the year to employees across the grades The current workforce structure has a good mix of employees at all levels and many qualified and trained employees have joined during the year. The Company is aware that the success of its business depends upon its technical experts coordinating with research and development staff on one hand and marketing on the other. Necessary training and orientation are provided to our employees to equip them in providing productive and committed results.
27. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/ OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given to the extent applicable in Annexure âAâ forming part of this Report.
28. DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary & trainees) are covered under the policy.
The following is a summary of sexual harassment complaints and disposed of during the year 2021-22.
No. of Complains received: NIL
No. of Complaints disposed off: NIL
29. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 (3) of the SEBI (LODR) Regulations, 2015, on the operations of the Company as prescribed under Schedule V, is presented in a separate section forming part of the Annual Report Annexed as Annexure âBâ.
30. CORPORATE GOVERNANCE
Your Company would strive to set and achieve appropriate Corporate Governance practices. In accordance with the requirements of Schedule V read with Regulation 34(3) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 with the Stock Exchange, a report on the status of compliance of Corporate Governance norms is also attached as Annexure âCâ. A certificate from the Statutory Auditors of the Company, confirming compliance with the conditions of Corporate Governance, as stipulated in the Listing Regulations forms part of the Annual Report.
31. BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
Your Company stands at 828th position at 31st March, 2021 based on market capitalization amongst the companies listed on the National Stock Exchange of India. It has advanced to 703th position as on 31st March, 2022. Your Company has the option to continue with the earlier form for the current year, as a part of this Report. The same is attached as Annexure âDâ and forms part of this Report.
32. DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge, belief, explanation and information obtained by them and as required under Section 134(3)(c) of the Companies Act, 2013, your Directors confirm that:
(i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure, if any;
(ii) they have selected such accounting policies as mentioned in Note 2 to the Notes to Financial Statements and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) they have prepared the Annual Accounts on a going concern basis;
(v) the proper internal controls were in place and that the financial controls were adequate and were operating effectively and the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively and
(vi) the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively
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 Annual Return as on 31st March, 2022 can be viewed on the website as per following link. at www.fineotex.com.
34. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There were no material changes and commitments affecting the financial position of the Company between the end of the financial year of the Company to which the financial statements relate and the date of the report.
35. COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company is in compliance with the Secretarial Standard issued by ICSI during the current financial year.
During the year rating assigned by CRISIL:
Long Term Rating: A-/ Stable Short Term Rating: A2
Your Directors place on record their sincere appreciation to the Central Government, the State Governments, BMC, all its investors, stakeholders & bankers, all the business associates for their co- operation and support extended to the Company. Your Directors also wish to place on record their deep appreciation to the employees for their hard work, dedication and commitment throughout the year especially.
For and on behalf of the BoardSurendrakumar Tibrewala Sanjay Tibrewala
(Chairman & Managing Director) (Executive Director)
DIN: 00218394 DIN: 00218525
Place : Mumbai Dated: June 24, 2022
Mar 31, 2018
Dear Shareholders,
The have pleasure in presenting the Fifteenth Annual Report, together with the Audited Financial Statements of the company for the Financial Year ended 31st March 2018.
1. HIGHLIGHTS
Standalone Profit After Tax for the year was Rs. 2128.14 Lakhs as against Rs. 2112.47 Lakhs for 2016-17 an increase of 0.75 %.
Earnings per share of Rs. 2 was Rs. 1.91 for the year as against Rs. 1.90 for 2016-17 an increase of 0.52 %.
Consolidated Profit after Tax for the year was Rs. 2396.64 Lakhs as against Rs. 2906.79 Lakhs for 2016-17 a decrease of 17.55 %.
2. FINANCIAL RESULTS
(Rs. in Lakhs)
|
Standalone |
Consolidated |
|||
|
Year ended 31-03-2018 |
Year ended 31-03-2017 |
Year ended 31-03-2018 |
Year ended 31-03-2017 |
|
|
Total Income |
9943 |
9214 |
14293 |
13440 |
|
Less: Expenditure |
6929 |
6435 |
11418 |
10593 |
|
Profits before Tax |
3014 |
2779 |
3392 |
3821 |
|
Less: Income Tax Expense |
886 |
667 |
995 |
914 |
|
Profit after Tax |
2128 |
2112 |
2397 |
2907 |
|
Other Comprehensive Income (net of tax) |
1 |
(3) |
1 |
(3) |
|
Total Comprehensive Income |
2129 |
2109 |
2397 |
2907 |
|
Opening balance of Retained Earnings |
7020 |
5022 |
7808 |
5250 |
|
Amount available for Appropriations |
9149 |
7131 |
10008 |
7825 |
|
Interim Dividend including Tax |
223 |
111 |
342 |
131 |
|
Closing Balance of Retained Earnings |
8926 |
7020 |
9736 |
7694 |
|
Earnings per share (in Rs) Basic & diluted |
1.91 |
1.90 |
2.04 |
2.32 |
The above data has been extracted from the Standalone and Consolidated Financial Statements prepared in accordance with the IndianAccounting Standards (Ind AS) as notified under section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards Rules 2015) and the relevant provisions of the Act, as applicable. These financial statements for the year ended 31st March, 2018 are the first financial statements of the Company prepared under Ind AS. A detailed note forming part of the financial statements explains the transition from previous GAAP to Ind AS and its effect on the performance and financial position.
3. OPERATIONS
The year under review was influenced by the after effects of demonetisation and the introduction of the Goods and Services Tax (GST) regime. The Company has faced the challenges upfront and the standalone revenue showed an increase of over 7.5% on value basis in the backdrop of GST and Demonetization. The Company used this period to consolidate its production and marketing infrastructure. The results are visible and the full impact would be visible in the current year. The Company has made significant inroads into domestic as well as export markets. It exports to over 40 countries and is a Star Export House.
4. SHARE CAPITAL
The paid-up equity share capital of the Company as on 31st March, 2018 stood at Rs. 22,26,00,000 comprising of 11,13,00,000 equity shares of Rs. 2/- each. During the year under review, there was no change in the Share Capital of the Company.
5. DIVIDEND
The Board of Directors had at their meeting held on 14th February, 2018 declared an interim dividend of Rs. 0.20 paise on equity share of face value Rs. 2/- each. Further the Board recommends that this Interim Dividend be treated as the Final Dividend.
6. SUBSIDIARIES
The summary of performance of the subsidiary companies is provided below:
a. Foreign Subsidiaries :
Fineotex Malaysia Limited (FML), a Limited Company, was incorporated in Labaun Malaysia in 2011. FML in turn has controlling interest in 3 other companies in Malaysia that have established manufacturing and trading activities. These Companies are BT Biotex Sdn Bhd, BT Chemicals Sdn Bhd and Rovatex Sdn Bhd. The synergy of the businesses has helped all the companies. These investments will complete 7 years in June 2018.
Fineotex Specialities FZE was incorporated in the Region of UAE on 25th January 2015.
b. Indian Subsidiaries :
Manya Steels Private Limited is the only Indian subsidiary. It was acquired for diversification. The Company would commence commercial operations in the future. It is not a material subsidiary as per the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of financial statements of subsidiary companies in Form AOC 1 is attached to the Accounts. The separate audited financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of the Annual General Meeting.
7. FINANCE
There have been no significant changes or commitments affecting the financial position of the Company which has occurred after the Balance Sheet date and the date of adoption of the Board Report.
During the year under review and till the date of the Board Report, there are none material / significant orders passed by the regulators or appellate authorities that may affect the going concern status of the Companyâs future operations.
8. INTERNAL FINANCIAL CONTROLS
The Company has in place a well defined and adequate internal control system to ensure, adherence to Companyâs policies, assets are safeguarded and that transactions are accurate, complete and properly authorized prior to recording. Information provided to management is reliable and timely and statutory obligations are adhered to. The internal control system is supplemented by extensive internal audits.
9. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company along with its subsidiaries - both foreign and Indian - for the year ended 31st March, 2018 form part of this Annual Report. The same are prepared as per the applicable Indian Accounting Standards (Ind AS) as notified under section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards Rules) 2015 and the relevant provisions of the Act, as applicable.
10. PUBLIC DEPOSITS, LOANS AND ADVANCES
The Company has not accepted any deposits from the public or the shareholders during the year or in the previous year. Security Deposits have been taken from the customers as a security against dues for goods sold to them and are not in the opinion of the Board in the nature of Public Deposits. Rent Deposit given to Subsidiary Company is disclosed in the financial statements as required under the Indian Accounting Standards (Ind AS) and Listing Agreements.
11. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS.
The Particulars of loans, guarantees and investments under Section 186 of the Companies Act, 2013 as at the end of the Financial Year 2017-18 are provided in the standalone financial statements and the same are also given in Annexure â1â forming part of this report.
12. RELATED PARTY TRANSACTIONS / CONTRACTS
All Related Party Transactions entered into during the year were on armâs length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.
All Related Party Transactions are approved by the Audit Committee. Prior omnibus approval is obtained from the Audit Committee in respect of transactions which are repetitive in nature.
The shareholders have also given the approval to these contracts and transactions at the 12th and 13 th Annual General Meeting of the Company.
Details of related party transactions are given in Annexure â2â giving the details as per AOC-2
The policy on Related Party Transactions as approved by the Board is available on the website of the Company www.fineotex. com and may be accessed through the web link http://fineotex. com/Investor-Relation.aspx.
13. DIRECTORS
Mrs. Ritu Gupta - A Non-Independent Non Executive Director of the Company has resigned from the Board with effect from 14th August, 2018 due to her pre-occupation in other engagements. Ms Aarti Jhunjhunwala has been appointed as an Additional Director with effect from 14th August, 2018 to fill in the casual vacancy caused by Mrs. Guptaâs resignation. She will retire at the conclusion of the ensuing 15th Annual General Meeting and being eligible she offers herself for re-appointment. She is liable to retire by rotation. The Board has appointed Mrs. Jhunjhunwala as an Executive Director for a period of 3 years. She is related to the Chairman & Whole-time Director of the Company.
14. BOARD MEETINGS
There has been no change in the Board of Directors or its Committees of the Company during the year. The Board of Directors of the Company met five times during the financial year. The details of various Board Meetings are provided in the Corporate Governance Report.
15. EMPLOYEES
Key Managerial Personnel (KMP)
The following have been designated as the Key Managerial Personnel of the Company as per the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
a) Mr. Surendrakumar Tibrewala - Chairman & Managing Director
b) Mr. Sanjay Tibrewala - Whole-Time Director & Chief Financial Officer
c) Ms. Raina DâSilva - Company Secretary (till 04/04/2018)
d) Ms. Pooja Kothari - Company Secretary (since 04/04/2018)
Particulars of Employees and related disclosures
None of the employees who were employed throughout the financial year was in receipt of remuneration of more than Rs. 1,02,00,000 during the year ended 31st March, 2018, nor was their remuneration in excess of that drawn by the Managing Director or Whole-time Director.
There were no employees employed for any part of the financial year 31st March 2018 in receipt of remuneration more than Rs.8,50,000 per month nor was their remuneration in excess of that of Managing Director and Whole-time Director.
Disclosure with respect to the remuneration of Directors, KMPs and employees as required under section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure â3â to this Report.
16. DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board that they fulfil all the requirements as stipulated in Section 149(7) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.
17. POLICY RELATING TO DIRECTORS, KMP AND OTHER EMPLOYEES
In line with the principles of transparency and consistency, your company has adopted the Nomination and Remuneration Policy which, inter alia, include criteria for determining qualifications, positive attributes and independence of a Director. The Remuneration policy is set out in the Annexure â4â to the Directorâs Report and is also available on the Companyâs website.
18. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS
In compliance with the requirements of the erstwhile Listing Agreement with the stock exchange (âListing Agreementâ) and SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 the Company had conducted a Familiarization Program on 16th February 2018 for the Independent directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, entitlement of sitting fees to independent directors etc. The details of such programme is available on the website of the Company http://fineotex.com/Investor-Relation. aspx#InvestorRelation.
19. BOARD EVALUATION
Pursuant to the provision of the Companies Act 2013 and Regulations 17 (10) and 25(4)(a) of the Listing Regulations, the Nomination and Remuneration Committee formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of Directors of the Company including independent directors. The performance evaluation of Audit Committee was also carried out.
The Evaluation of Board and its findings were shared by the Chairman individually with the Board Members. The Directors expressed their satisfaction with the evaluation process.
20. AUDITORS AND AUDIT REPORT
M/s. UKG Associates, the auditors of the Company, bearing ICAI Firm Registration No. 123393W, were appointed, at the 11th General Meeting, as Auditors for a period of five years - i.e. till the conclusion of 16th Annual General Meeting to be held in 2019.
M/s. UKG Associates have confirmed their eligibility and qualification required under Sections 139, 141 and other applicable provisions of the Companies Act, 2013 and Rules issued there under (including any statutory modification(s) or re-enactment(s) thereof for the time being in force).
The Auditorsâ Report for the financial year ended 31st March, 2018 on the financial statements of the Company is a part of this Annual Report. The Auditors Report for the financial year ended 31st March, 2018 does not contain any qualification, reservation or adverse remark.
21. COST ACCOUNTING RECORDS AND COST AUDIT
With the notification of Companies (Cost Records and Audit) Rules, 2014, the Company is advised that it is not liable to Cost Audit since the turnover as per standalone financial statements of the Company is below Rs. 100 crores.
22. SECRETARIAL AUDIT
As per Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 it is mandatory for the Listed Company, like yours, to have the secretarial records audited. The Board of Directors had appointed HS Associates, Company Secretaries as Secretarial Auditors for 2018-19.
The Secretarial Audit Report is annexed herewith as Annexure â5â.
The Secretarial Audit Report for 2017-18 does not contain any qualification, reservation or adverse remark.
23. CORPORATE SOCIAL RESPONSIBILITY
In compliance with the requirements of section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules 2014 mandates that your Company spends at least 2% of its average last 3 years net profit after tax on Corporate Social Responsibility (CSR) Activities and explained therein. This was the fourth year of compliance for your Company, the Company has formed a Committee which has gone through the requirements and decided to carry out the same through the Trust who carry out these activities. The Company had to Spend Rs. 37.06 Lakhs in 2017-18. However it has spent Rs. 38 Lakhs till 31st March, 2018.
Details of CSR is annexed herewith as Annexure â6â
24. RISK MANAGEMENT COMMITTEE
As per Regulation 21 of (Listing Obligation and Disclosure Requirements) Regulation, 2015, the provisions of Risk Management Committee is not applicable for your Company. However the management of the Company is determining various aspects so as to be able to minimise the risk in all spheres of the Companyâs business from finance, human resources to business strategy, growth and stability.
25. AUDIT COMMITTEE
The details pertaining to composition of audit committee are included in the Corporate Governance Report which forms a part of this Report.
26. WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has established a vigil mechanism for Directors and employees to report their genuine concerns, details of which have been given in the Corporate Governance Report annexed to this Report. The copy of the Policy is available on the website of the Company and may be accessed through the web link http:// fineotex.com/Investor-Relation.aspx#InvestorRelation No complaints/suggestions were received during the year.
27. HUMAN RESOURCES
The Company has 84 employees at the year end including Whole time Director. We consider our employees as our most valuable asset and have been working towards keeping them engaged and inspired. The current workforce structure has a good mix of employees as all levels. The Company is aware that the success of its business depends upon its technical expertâs co-coordinating with research and development staff on the one hand and marketing on the other. Necessary training and orientation is provided to our employees to equip them in providing productive and committed results.
28. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/ OUTGO
The Information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given to the extent applicable in Annexure âAâ forming part of this report.
29. DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary & trainees) are covered under the policy.
The following is a summary of sexual harassment complaints and disposed off during the year 2017-18
No of Complains received: NIL
No of Complaints disposed off: NIL
30. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 (3) of the SEBI (LODR) Regulations, 2015, on the operations of the Company as prescribed under Schedule V, is presented in a separate section forming part of the Annual Report Annexed as Annexure âBâ.
31. CORPORATE GOVERNANCE
Your Company would strive to set and achieve appropriate Corporate Governance practices. In accordance with the requirements of Schedule V read with Regulation 34(3) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 with the Stock Exchange, a report on the status of compliance of corporate governance norms is also attached as Annexure âCâ. A certificate from the Statutory Auditors of the Company, confirming compliance with the conditions of Corporate Governance, as stipulated in the Listing Regulations forms part of the Annual Report.
32. OPERATIONS & ECONOMIC SCENARIO
The economy has stabilized after the introduction of Goods & Services Tax (GST) which was introduced from 1st July, 2017. The outlook is positive and our Company has adapted well in this scenario. There has been 7 % rise in sales in spite of cautious approach in the economy prior to and after the GST came into force. The Company was cautious about the emerging situation and the teething problems in the new regime unfolded. The Company continues to remain vigilant to face the new challenges.
The Companyâs thrust continues to concentrate on new markets and pioneering new products to enhance the operational efficiency of the customers. The Company has strengthened its human recourses to tackle the needs of the customers with entrepreneurial zeal. This commitment is total and coupled with its focused drive to achieve growth through better management of both materials and overheads. The Company has recorded an increase in turnover of 7% on standalone basis while the consolidate turnover showed a moderate rise due to more efforts on development of products. This will show results in the coming quarters.
The sales were affected due to certain major monetary decisions taken by the government. There were teething problems. The Company target exports which resulted in additional earnings of over 1.13%. The exports contribute over 1.42% of its operations on a standalone basis. The Company has also reached an advance stage in production of products which would foray the Companyâs operations in to new sector thereby widening and diversifying its activities.
33. DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and explanation and information obtained by them and as required under Section 134(3)(c) of the Companies Act, 2013, your Directors confirm that:
(i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure, if any;
(ii) they have selected such accounting policies as mentioned in Note 2 to the Notes to Financial Statements 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 at the end of the financial year and of the profit of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) they have prepared the annual accounts on a going concern basis ;
(v) the proper internal controls were in place and that the financial controls were adequate and were operating effectively and
(vi) the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
34. 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, an extract of the Annual Return as on 31st March, 2018 in Form No. MGT 9 is attached herewith as Annexure â7â and forms part of this Report.
35. ACKNOWLEDGEMENTS
Your Directors place on record their sincere appreciation to the Central Government, the State Governments, all its investors, stakeholders & bankers all the business associates for the cooperation and support extended to the Company. Your Directors also wish to place on record their deep appreciation to the employees for their hard work, dedication and commitment extended to it throughout the year.
For and on behalf of the Board
Surendrakumar Tibrewala Sanjay Tibrewala
(Chairman & Managing Director) (Executive Director)
00218394 00218525
Place : Mumbai
Dated: 14-August-2018
Mar 31, 2014
Dear members,
The Directors hereby present their Eleventh Annual Report together
with the Audited Statement of Accounts of the Company for the year
ended 31st March 2014.
FINANCIAL RESULTS (Rs. in Lakhs)
Standalone
Year ended Year ended
31-3-2014 31-3-2013
Total Income (net of Excise duty) 5,719.01 4,318.23
Less: Expenditure 4,861.16 3,524.08
Less: Depreciation 20.69 20.26
Less: Finance Costs 34.27 40.01
Net Profit before Tax 802.88 733.75
Provision for Tax (including short 222.02 190.78
provision for Previous Year)
Profit after tax 580.86 542.96
Appropriations
Dividend on Equity Shares 56.15 56.15
Tax on Dividend (8.88) 9.11
Balance Brought forward
from previous Year 2,075.14 1,597.44
Profit carried to Reserves 2,608.72 2,075.14
FINANCIAL RESULTS (Rs. in Lakhs)
Consolidated
Year ended Year ended
31-3-2014 31-3-2013
Total Income (net of Excise duty) 8,926.70 9,836.80
Less: Expenditure 7,743.89 8,641.37
Less: Depreciation 26.20 29.82
Less: Finance Costs 40.21 52.23
Net Profit before Tax 1,116.40 1,113.37
Provision for Tax (including short 334.81 302.20
provision for Previous Year)
Profit after tax 781.59 811.17
Appropriations
Dividend on Equity Shares
Tax on Dividend
Balance Brought forward
from previous Year
Profit carried to Reserves
DIVIDEND
Your Directors have recommended a dividend of Re 0.50 per equity share
( Last year Re. 0.50 per share) for the year ended 31st March, 2014.
The dividend will be paid to the members whose names appear in the
register of members as on 19th September, 2014.. In case of shares held
in dematerialised form the same will be paid to members whose names are
furnished by National Securities Depository Limited and Central
Depository Services (India) Limited as beneficial owners as on that
date. The dividend is free from Income Tax in the hands of the
shareholders.
OPERATIONS
The economic conditions during the year under review were worse than
those compared to the earlier year. The Company could achieve a
turnover of Rs. 5,719 lakhs as against Rs. 4,319 lakhs last year, on
Stand alone basis, an increase of 32.41 % inspite of the depressed
economic conditions. There was a record fall in the Rupee value
vis-a-vis the US dollar during the year resulting overall rise in input
costs which could not be fully passed on to the customers. The Company
was able to meet the challenge, maintain its position by adapting to
the changing environment, ensuring timely delivery and new product
development. The Company continues to develop new products and modify
the products as per the requirements of its customers. Company has its
own testing and development facilities by qualified staff.
This ensured higher sales which helped it to maintain its absolute
profits. Your directors are hopeful that, subject to unforeseen
circumstances, the Company would be in a position to maintain robust
growth rate in the current year.
One big hindrance in the smooth performance during the year was the
levy of Local Bodies Tax by the Government of Maharashtra last year. It
is heard in the market that the Government is considering the review of
the same. It is facing widespread resentment and would have very
negative impact on the performance of the businesses as well as
margins. Your Company is therefore reviewing the entire plan it had. It
has already sought the shareholders permission to go in for
diversification. A wholly owned subsidiary has been formed to pursue
the company''s foray into reality business.
SUBSIDIARIES
Fineotex Malaysia Limited (FML), a Limited Company, was incorporated in
Labaun Malaysia in 2011. FML in turn had controlling interest in 3
other companies in Malaysia that have established manufacturing and
trading activities. Their turnover is higher than the parent company.
The synergy of the businesses has helped all the companies.
FCL Landmarc Private Limited was incorporated in March 2013 as a wholly
owned subsidiary to pursue Company''s activities in the reality sector.
In October 2013, it took over Manya Steels Private Limited (Manya) as a
wholly owned subsidiary. It owns land in Wada Taluka in Thane District
of Maharashtra which the Company proposes to use for further expansion.
In March 2014, Manya was made the direct subsidiary of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company along with its
subsidiaries for the year ended 31st March, 2014 form part of this
Annual Report
PUBLIC DEPOSITS AND LOANS AND ADVANCES.
The Company has neither accepted any deposits from the public or the
shareholders during the year nor are there any outstandings as at year
end. Loans & Advances given to Subsidiaries are disclosed in the
financial statements as required under Clause 32 of the Listing
Agreement with the Bombay Stock Exchange Limited.
RELATED PARTY CONTARCTS.
The Company had entered into contracts with related parties which were
either covered under Section 297 of the Companies Act,1956 or were
exempt there under. These were properly approved by the Board,
shareholders and disclosed in the Prospectus issued by the Company in
February 2011 at the time of Initial Public Offer, Subsequently in
2012, the Company had received the approval of the Regional Director,
Ministry of Corporate Affairs, Government of India which are valid till
31st March, 2015. There are also other contracts regarding taking of
premises on rent. These had been fully disclosed in the Prospectus but
did not require any further approval under the erstwhile Act. As
disclosed and explained in the Prospectus these contracts are
comparable with the market prices. As per the Companies Act, 2013, you
consent is required as per the provisions of Section 188 of the said
Act. These are as per the normal business terms and, in the opinion of
the Board, not prejudicial to the Company''s interest. The Board seeks
your approval.
DIRECTORS
There were no changes to the Board during the year. Mr. Manmohan Mehta,
Mr. Navin Mittal and Mr Alok Dhanuka are the three Independent
Directors on the Board of the Company as per the Listing Agrement with
the Bombay Stock Exchange Limited. As per the provisions of Section 149
of the Companies Act, 2013, at least one third of the Board should have
independent Directors. They have given declarations stating that they
meet with the criteria of Independence as prescribed under Section
149(6) of the Companies Act 2013.
Mr. Manmohan Mehta is due to retire by rotation at the ensuing Annual
General Meeting as per the provisions of the erstwhile Companies Act,
1956 and is eligible for re-appointment. The Board of the Company seeks
the reappointment of Mr. Manmohan Mehta and Mr Alok Dhanuka as
Independent Director for a term of five years till the Annual General
Meeting to be held in 2019. The Company has received separate notices
under Section 160 of the Companies Act 2013 from members signifying
their intention to propose them as candidates for the office of an
Independent Directors at the ensuing Annual General Meeting. Profiles
of Mr. Manmohan Mehta and Mr Alok Dhanuka are given in Corporate
Governance Report and Explanatory Statement to the notice of the
Eleventh Annual General meeting.
Ms Ritu Gupta was appointed as Additional Director by the Board on 13
th August, 2014. She is a MBA Finance from S P Jain, Centre of
Management. She was also associated with the Company as General Manager
initially at the time of Initial Public offer. She is related to the
Chairman and Managing Director and to the Executive Director. Her
details are given in the annexure to the notice. She is therefore a
Non- Independent Director liable to retire by rotation.
AUDITORS AND AUDIT REPORT
Messrs UKG & Associates, the auditors of the Company, bearing ICAI
Registration No Firm Registration No. 123393W, retire at the conclusion
of the ensuing Annual General Meeting and are eligible for
reappointment. They have given their declaration, in writing, that they
are eligible and willing for re-appointment as Auditors. As per the
provisions of Section 139 of the Companies Act, 2013 and Rules made
there under, they are eligible for reappointment to hold office till
the conclusion of 5th Annual General Meeting held thereafter. The Audit
Committee has recommended their reappointment which the Board has
accepted. Board recommends their appointment.
COST ACCOUNTING RECORDS AND COST AUDIT
The Cost Audit Branch (CAB) of the Ministry of Corporate Affairs have
issued CAB Order dated 24th January, 2012 making the products of the
Company liable to Cost Audit under Section 233B of the Companies Act,
1956. This Order would apply to accounting periods commencing on or
after 1st April, 2012. The Board has therefore recommended the name of
M/s V J Talati & Co. as Cost Auditors of the Company. The approval of
the government is received and M/s VJ Talati & Co. would do the audit
for 2013-14. The Board also proposes to appoint them for 2014-15. The
Audit Committee recommended their appointment.
SECRETARIAL AUDIT
The Companies Act, 2013 has made it mandatory for the Listed Company,
like yours, to have the secretarial records audited. The Board of
Directors have appointed HS Associates, Company Secretaries as
Secretarial Auditors for 2014-15.
PARTICULARS OF EMPLOYEES
None of the employees of the Company drew a remuneration of Rs. 5
lakhs per month or Rs 60 lakhs per annum during the year under review.
Hence there is no disclosure required as per provisions of Section
217(2A) of the Companies Act, 1956.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS/OUTGO
Information as required by the provisions of Section 217(1)(e) of the
Companies Act, 1956 read with Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1988 is annexed and forms
part of this report. Refer Annexure A DIRECTORS'' RESPONSIBILITY
STATEMENT As required under Section 217 (2AA) of the Companies Act,
1956, your Directors confirm that:
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanations
relating to material departure;
(ii) they 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 at the end of the financial year and of the profit of the
Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they have prepared the Accounts on a going concern basis
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the requirements of the clause 49 of the Listing
Agreement with the Bombay Stock Exchange Ltd. a report on Management
Discussion and Analysis is attached hereto (Annexure ''B'') and form part
of this Report.
CORPORATE GOVERNANCE
Your Company would strive to set and achieve appropriate Corporate
Governance practices. In accordance with the requirements of clause 49
of the Listing Agreement with the Stock Exchange, a report on the
status of compliance of corporate governance norms is also attached.
(Annexure ''C''). The Auditors certificate on the same is also attached.
ACKNOWLEDGEMENT
Your Directors wish to thank the Company''s stakeholders, Bankers and
employees for their support extended to it throughout the year.
For and on behalf of the Board
Place : Mumbai (Surendrakumar Tibrewala)
Dated: 13-Aug-2014 Chairman
Mar 31, 2013
The Directors hereby present their Tenth Annual Report together with
the Audited Statement of Accounts of the Company for the year ended
31st March 2013.
1. FINANCIAL RESULTS
The Highilights of the performance of the Company during the Financial
Year ended 31st march 2013 are appended below:-
(Rs. in Lakhs)
Year ended Year ended
2012-2013 2011-2012
Total Income (net of Excise duty) 4318.50 3,553.52
Less: Expenditure 3,524.48 2,760.87
Less: Depreciation 20.26 17.05
Less: Finance Costs 40.01 29.10
Net Profit before Tax 733.75 746.50
Provision for Tax (including short
provision for Previous Year) 190.79 232.90
Profit after tax 542.96 513.60
Appropriations
Dividend on Equity Shares 56.15 56.15
Tax on Dividend 9.11 9.11
Balance Brought forward from
previous Year 1,597.44 1,149.10
Surplus carried to Reserves 2075.14 1,597.44
2. DIVIDEND
Your Directors have recommended a dividend of 5% i.e Re 0.50 per equity
share ( Last year Re. 0.50 per share) for the year ended 31st March,
2013. The dividend will be paid to the members whose names appear in
the register of members as on 26-September-2013. In case of shares held
in dematerialised form the same will be paid to members whose names are
furnished by National Securities Depository Limited and Central
Depository Services Limited as beneficial owners as on that date. The
dividend is free from Income Tax in the hands of the shareholders.
3. OPERATIONS
The Company could achieve a turnover of Rs. 4,068.64 lakhs as against
Rs. 3,332.19 lakhs in last year, an increase of 22.10 % inspite of the
depressed economic conditions. The Company was able to meet the
challenge, maintain its position by adapting to the changing
environment, ensuring timely delivery and new product development. The
Company continues to develop new products and modify the products as
per the requirements of its customers. It has its own testing and
development facilities backed by qualified staff. This ensured higher
sales which helped it to maintain its absolute profits. Your directors
are hopeful that, subject to unforeseen circumstances, the Company
would be in a position to maintain robust growth rate in the current
year.
4. SUBSIDIARIES
Fineotex Malaysia Limited (FML), a Limited Company, was incorporated in
Labaun Malaysia in 2011. FML in turn has controlling interest in 3
other companies in Malaysia that have established manufacturing and
trading activities. The synergy of the businesses has helped all the
companies.
During the year, FCL Landmarc Private Limited was incorporated as a
wholly owned subsidiary to pursue Company''s activities in the
realty sector as approved by the shareholders at the Ninth Annual
General Meeting without affecting the activities of the chemical
business. It will carry on the realty business as joint ventures in the
initial stages. Realty business has better potential & profitability.
5. DIRECTORS
During the year Mr. Alok Dhanuka was appointed as Additional Director.
Notices have been received from the shareholders proposing his name as
Director of the Company. Mr. Sanjay Mittal resigned from the Board of
the Company with effect from 11th February, 2013 due to his
preoccupation. The Board notes with appreciation the services and
advices rendered by him.
Mr. Navin Mittal retires by rotation and, being eligible, offers
himself for reappointment.
6. PARTICULARS OF EMPLOYEES
None of the employees of the Company drew a remuneration of Rs. 5 lakhs
per month or Rs 60 lakhs per annum during the year under review. Hence
there is no disclosure required as per provisions of Section 217(2A) of
the Companies Act, 1956.
7. ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE
Information as required by the provisions of Section 217(1)(e) of the
Companies Act, 1956 read with Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1988 is annexed and forms
part of this report. Refer Annexure A.
8. DIRECTORS'' RESPONSIBILITY STATEMENT
As required under Section 217 (2AA) of the Companies Act, 1956, your
Directors confirm that:
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanations
relating to material departure;
(ii) they 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 at the end of the financial year and of the profit of the
Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they have prepared the Accounts on a going concern basis
9. MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the requirements of the clause 49 of the Listing
Agreement with the Bombay Stock Exchange Ltd. a report on Management
Discussion and Analysis is attached hereto (Annexure ''B'')
and form part of this Report.
10. CORPORATE GOVERNANCE
Your Company would strive to set and achieve appropriate Corporate
Governance practices. In accordance with the requirements of clause 49
of the Listing Agreement with the Stock Exchange, a report on the
status of compliance of corporate governance norms is also attached
(Annexure ''C''). The Auditors certificate on the same is
also attached.
11. AUDITORS AND AUDIT REPORT
Messrs UKG & Associates, the auditors of the Company, retire at the
conclusion of the ensuing Annual General Meeting and are eligible for
reappointment. They have given their declaration that they are eligible
and willing for re-appointment as Auditors for the ensuing year. The
Board recommends their appointment.
12. COST ACCOUNTING RECORDS AND COST AUDIT
The Ministry of Corporate Affairs has issued a notification dated 3rd
June, 2011 titled The Companies (Cost Accounting Records) Rules, 2011
making it mandatory for your Company to maintain Cost Accounting
Records as prescribed therein. The Cost Audit Branch (CAB) of the
Ministry of Corporate Affairs have issued CAB Order dated 24th January,
2012 making the products of the Company liable to Cost Audit under
Section 233B of the Companies Act, 1956. This Order would apply to
accounting periods commencing on or after 1st April, 2012. The company
has appointed M/s V. J. Talati & Co., Cost Auditor, Mumbai to audit the
cost accounts for the year 2012-13 from 1 April, 2012 to 31 March, 2013
for which necessary approval from the Central Government has been
received.
The Company has obtained the Cost Compliance Certificate for the year
2011-12 from M/s V J Talati & Co the Practising Cost and Management
Accountant and filed with the Ministry of Corporate Affairs within the
stipulated period.
The Board proposes to re-appoint M/s V. J. Talati & Co., as cost
auditor of the company for year 2013-14.
13. ACKNOWLEDGEMENT
Your Directors wish to thank the Company''s stakeholders, Bankers
and employees for their support extended to it throughout the year.
For and on behalf of the Board
(Surendrakumar Tibrewala)
Chairman
Date : 15-May-2013
Place : Mumbai
Mar 31, 2011
Dear Members,
The Directors hereby present their Eighth Annual Report together with
the Audited Statement of Accounts of the Company for the year ended 31
st March 2011
FINANCIAL RESULTS
(Rs. in Lakhs)
Year ended Year ended
31-3-2011 31-3-2010
Gross Income 3101.68 2279.04
Less: Expenditure 2455.60 1597.39
Less: Depreciation 13.05 12.67
Net Profit before Tax 633.03 536.10
Provision for Tax (including short 208.22 186.26
provision for Previous Year)
Profit after tax 424.81 349.84
Appropriations
Dividend on Equity Shares 56.15 70.19
Tax on Dividend 9.33 11.65
Balance Brought forward from previous Year 789.78 521.78
Profit carried to Balance Sheet 1149.11 789.78
DIVIDEND
Your Directors have recommended a dividend of Re.0.50 per Equity share
(Last year Rs. 1.00) for the year ended 31 st March, 2011. The dividend
will be paid to the members whose names appear in the register of
members as on x-xrtx-2011. In case of shares held in dematerialised
form the same will be paid to members whose names are furnished by
National Securities Depository Limited and Central Depository Services
Limited as beneficial owners as on that date. The dividend of Rs. 0.50
per share would be paid on all shares including those that were
allotted on 8th March, 2011 pursuant to the Initial Public Offer.
OPERATIONS
During the year under review, the Company could achieve a turnover of
Rs. 3061 lakhs as against Rs. 2208 lakhs last year an increase of 38.63
% inspite of the depressed economic conditions in the textile sector.
Due to rising costs of the oil and its inflationary impact on other
items, the inputs costs continued to rise in the year under review.
This also led severe strain on the margins. The Company was able to
maintain its position by adapting to the changing environment, ensuring
timely delivery and new product development. This ensured higher sales
which helped it to maintain its absolute profits inspite of depressed
margins. Your directors are confident, that subject to unforeseen
circumstances, the Company would be in a position to maintain robust
growth rate in the current year.
INITIAL PUBLIC OFFER & FINANCES OF THE COMPANY
With your approval under section 81(1A) of the Companies Act. 1956 for
the Initial Public Offer (IPO), the Company had filed a Draft Red 1
lerring Prospectus in September 2010 with the Securities Exchange Board
of India (SEBI) for its approval. The IPO was opened for subscription
between 23rd to 25th February, 2011. The shares of Rs. 10/- each were
issued at a premium of Rs. 60/- per share. The issue was oversubscribed
in spite of the poor market conditions and other big issues open at the
same time. The Company raised a sum of Rs. 2759.27 lakhs net of the
issue related expenses. The allotment was done on 8th March, 2011 and
the shares were listed on the Bombay Stock Exchange Limited from 1 Ith
March, 2011.
Deployment of funds received As per Actual
from IPO Prospectus Incurred
Investment in Capital expenditure 925 Ã
Working Capital Requirements 800 Ã
General Corporate Purpose 976 Ã
Issue Related Expenses 247 205
Total 2948 205
Balance amount to be utilised 2743
Interim Utilisation of balance IPO proceeds
nvestments in Mutual Funds 243
Fixed Deposits2500
Total 2743
Your Directors are at present evaluating various options for deployment
of funds as stated above. Certain proposals may require certain
adjustments to the amounts mentioned under various heads as mentioned
in the prospectus. Your approval is sought for this purpose.
DIRECTORS
CA Anand Agarwal retires by rotation at the conclusion of the ensuing
Annual General Meeting and being eligible offer himself for
reappointment. The Board recommends his reappointment.
AUDITORS AND AUDIT REPORT
Messrs UKG Associates, the auditors of the Company, retire at the
conclusion of the ensuing Annual General Meeting and are eligible for
reappointment. They have given their declaration that they are eligible
and willing for re-appointment as Auditors for the ensuing year. The
Board recommends their appointment.
PARTICULARS OF EMPLOYEES
None of the employees of the Company drew a remuneration of Rs. 5 lakhs
per month or Rs 60 lakhs per annum during the year under review. Hence
there is no disclosure required as per provisions of Section 217(2A) of
the Companies Act, 1956.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS/ OUTGO
Information as required by the provisions of Section 217(l)(e)of the
Companies Act, 1956 read with Companies (Disclosure of Particulars in
the Report of the Board of Directors) Rules, 1988 is annexed and forms
part of this report. Refer Annexure A
DIRECTORS' RESPONSIBILITY STATEMENT
As required under Section 217 (2 AA) of the Companies Act, 1956, your
Directors confirm that:
(i) in the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanations
relating to material departure;
(ii) they 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 at the end of the financial year and of the profit of the
Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
(iv) they have prepared the Accounts on a going concern basis
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the requirements of the clause 49 of the Listing
Agreement with the Bombay Stock Exchange Ltd. a report on Management
Discussion and Analysis is attached hereto (Annexure 'B') and form part
of this Report.
CORPORATE GOVERNANCE
Your Company would strive to set and achieve appropriate Corporate
Governance practices. In accordance with the requirements of clause 49
of the Listing Agreement with the Stock Exchange, a report on the
status of compliance of corporate governance norms is also attached.
(Annexure 'C'). The Auditors certificate on the same is also attached.
ACKNOWLEDGEMENT
Your Directors wish to thank the Company's stakeholders, Bankers and
employees for their support extended to it throughout the year.
For and on behalf of the Board
(Surendra Kumar Tibrewala)
Chairman
Date : 28th May 2011
Place : Mumbai
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