Directors Report of Modi Naturals Ltd.
Mar 31, 2023
The Directors have pleasure in presenting the Forty-Nineth Annual Report and audited financial statements for the financial year ended 31s1 March 2023.
The summarized financial results of the Company are presented below:
|
(Rs. Lakhs) |
||||
|
Standalone |
Consolidated |
|||
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
|
|
Revenue from operations |
41796.21 |
47430.32 |
41796.21 |
47430.32 |
|
Other Income |
173.20 |
131.44 |
173.20 |
131.44 |
|
Total Income |
41969.41 |
47561.76 |
41969.41 |
47561.76 |
|
Profit before financial expenses, depreciation, and tax |
702.54 |
1621.62 |
694.95 |
1617.96 |
|
Less: Financial Expenses |
353.20 |
180.57 |
353.20 |
180.57 |
|
Depreciation / Amortization |
152.68 |
142.06 |
152.69 |
142.16 |
|
Profit before tax |
196.66 |
1298.99 |
185.86 |
1295.23 |
|
Tax expense |
79.62 |
358.81 |
79.01 |
358.70 |
|
Profit after tax for the year |
117.04 |
940.18 |
106.85 |
936.53 |
|
Total Comprehensive Income |
127.98 |
938.03 |
117.79 |
934.38 |
|
Earnings Per Share (face value of ?10/- each) |
||||
|
- Basic |
1.01 |
7.41 |
0.93 |
7.38 |
|
- Diluted |
1.01 |
7.41 |
0.93 |
7.38 |
No dividend is proposed for the financial year ended 31s1 March 2023.
No amount is proposed to be transferred to reserves.
Your Company, during the fiscal 2023, recorded revenue from operations of ? 41796.21 lac, a decline of 11.87% over previous year. The Profit Before Tax (PBT) was ?196.66 lac against ?1298.99 lac in the previous year. The Profit After Tax (PAT) was ?117.04 lac against ?940.18 lac in the previous year. Revenue from bulk oil business impacted due to severe correction in oil prices. The branded oil business has, however, grown. Profitability has taken a hit due to the massive fall in international oil and other commodity prices which has led to inventory losses for FY23. Interest costs have increased as equity was infused into wholly owned subsidiary, Modi Biotech Pvt Ltd, and therefore working capital borrowing increased for FY23.
Segment, Product wise Performance
Modi Naturals is today one of India''s leading consumer goods companies operating in the wellness and foods category.
The company is poised to grow exponentially in the next few years with its three verticals namely a). consumer goods vertical, b). bulk edible oil and feeds vertical and c). alcohol manufacturing vertical.
Modi Naturals'' Branded /Consumer Goods vertical includes a range of products that includes healthy & premium edible oil, Popcorn, Pasta, Peanut Butter, Instant Drink Mix etc.
> In healthy and premium edible oil category- the company''s branded product portfolio includes Oleev Olive oil, Oleev Active oil (healthy Olive oil and Rice Bran Oil blend), Oleev Health Oil (Multisource Oil) Oleev Smart Oil (Multisource oil), Rizolo Rice bran oil, Miller Canola Oil and Olivana Wellness Oil (100% natural versatile oil with goodness of pure olives - can be used for cooking, hair, skin care and baby care). We are the only player making Multi-Source Olive oil.
Your Company''s flagship brand, âOLEEVâ is a leading name in the edible oil market, and it caters to the premium segment of the market. In the multisource edible oil category, âOleev Active'' has continued to increase its dominance. Volume has recovered after removal of stock limits, and we expect to see growth pick up in subsequent quarters.
Modi Naturals has engaged to a fitness Icon - former Miss Universe and Actor, Lara Dutta as the brand ambassador for their range of olive and multisource cooking oils. This defines a new era for the brand and reflects the brand positioning statement âBehtar Kal Ki Shuruaat, Aaj Se''.
> In healthy Indulgent snacking category - the company''s branded product portfolio includes :
¦ PIPO Popcorn and unique Taste Bomb sachets inside with exciting flavours Peri Peri, Tomato Salsa, Cheese Burst, Tandoori Twist, to suit the Indian palate better compared to the regular butter/cheese flavours available in the market.
Under PIPO, extending our product portfolio and getting into the ready-to-eat space, we have launched on a pilot basis our range of flavoured roasted peanuts. These ready-to-eat peanuts are available in five flavours, including Periperi, BBQ, heeng-jeera, and others.
¦ Taste Bomb, PIPO''s sub-brand, is being separately launched in the instant masala/seasoning category, with six variants i.e. Magic masala, pasta masala, peri peri, Oregano, Italian herbs, and Tandoori.
¦ âPeanut Butter'' with two variants Creamy & Crunchy under the sub-brand OLEEV KITCHEN.
In Peanut Butter, we are creating a vertical segmentation wherein we have launched Oleev Junior Peanut Butter specifically targeted for children in the age bracket of 4-13 years. Additionally, Oleev Junior Peanut butter chocolate flavour was piloted in Q4FY23.
¦ âPasta'' (100% Wheat Semolina & 0% Maida) with three variants, under the sub-brand OLEEV KITCHEN.
Extending the range of ready-to-cook pasta and introducing new shapes, i.e. macaroni and spaghetti, with a commitment to food innovation, we have launched a one-of-its-kind multigrain pasta with the goodness of four grains in the premium category,
¦ New category of powdered ready-to-mix beverages was piloted in Q4FY23 under new brand âJynxâ with the following flavours- mango, orange, iced tea-lemon and Mojito.This will help us enter an exciting new category which is doing well with Gen-Z and will also offset some of the seasonality in oil demand in summer months.
Food business has grown by 40% YoY in FY23, 20% QoQ and it is still scaling up with distribution expansion and new product introductions every quarter. Profitable at the operating level for all food segments. On the food business, we continue extend our offerings and stick to our commitment towards food innovation, which will yield results and create a robust product portfolio strengthening our brand.
> In the bulk edible oil segment, the company manufactures and markets Rice Bran oil, Rice Bran wax and De-oiled cakes.
¦ Performance for FY23 has been relatively soft owing to many challenges faced on account of the war in Ukraine and the consequent volatility in oil prices and other commodities. Our bulk oil business should go back to profitability this year with oil prices stabilizing.
The Company has created niche, premium and differentiated brands in highly competitive categories of edible oils and healthy foods. Our strong focus on quality, innovation, product differentiation and brand building has helped us stand out in a cluttered retail market, with âOleev'' becoming the No.1 âGoodness of Olive Oil" brand in India, with a fully backward-integrated portfolio of products. Over the last decade, we have developed a pan-India distribution network across all channels of FMCG, including the upcoming Q-Commerce, serving our consumers through all modes of online and offline retail across the country. We are a very proud Indian company, manufacturing, and marketing world-class food products in India.
The Company is present on all e-commerce platforms including Amazon, Blinkit (Big Basket), Flipkart, Grofers and Jio Mart. Further, the company is widely distributed in 3,000 organized modern retail outlets and also has around 450 distributors pan India with a direct reach of about 50,000 retail stores, which will be used to penetrate further in healthy snaking foods category. Recently, the Company has started food business with a few more large retail players like Spencer''s which will reflect in numbers in the coming quarters.
> Ethanol Business : A step towards sustainable growth, Modi Naturals has diversified into ethanol manufacturing, with a state-of-the-art greenfield Ethanol Plant being established in the State of Chhattisgarh under its 100% subsidiary, Modi Biotech Private Limited. This project is in line with the company''s core values & commitment towards sustainable growth and will also help the company have a diversified portfolio of businesses. This project is also in line with the Honourable Prime Minister of India Shri Narendra Modi''s vision & roadmap for the Ethanol Blended Petrol (EBP) program with a target of 20% blending by 2025. The investment over the next two years is expected to be approximately ?250 cr., with the first phase of 110 KLD with an investment of ?160 cr.
¦ Delayed delivery of some critical bought-out items such as pumps and electronics which faced global supply chain disruptions led to a delay in start of ethanol production. Section trials of our ethanol distillery have started, and we expect to commission the plant in September 2023.
Your Company is placed competitively in the industry and is determined to grow its market share and profitability sustainably through focus on developing top-notch products coupled with extensive advertising and promotional campaigns.
OUTLOOK, OPPORTUNITIES, RISKS & CONCERNSIndian Economy
Even as the global conflict remained geographically distant from India, ripples comprised increased oil import bills, inflation, cautious government and a sluggish equity market. India''s economic growth was 7.2% in FY 2022-23. India emerged as the second fastest-growing G20 economy in FY 2022-23. India overtook UK to become the fifth largest global economy. India surpassed China to become the world''s most populous nation. (Source: IMF, World Bank)
India is widely acknowledged as one of the most dynamic major economies in the world with immense headroom for growth over the medium and long term. A favourable demographic profile, increasing affluence, rapid urbanisation and accelerated digital adoption represent some of the key structural drivers of growth of the Indian Economy.
The FMCG sector continues to remain an exciting sector with continued growth potential driven by India''s economic growth. The FMCG industry in India has been reporting good growth even during the COVID years, when most other industries were reeling under a demand crunch, riding on strong consumer shift in favour of natural healthcare products. The frequent price increases and an overall slump in economic activity put pressure on the purchasing power of consumers particularly in Rural India. Despite near term consumption pressure, there are some green shoots which are emerging such as moderating inflation, improving consumer confidence and increase in government spending. This should help revive demand and drive consumption of consumer goods in the future.
India''s per capita consumption of edible oil is relatively low at 19-19.80 kg per year, compared to the global average of 24 kg per year. However, with a growing population and increasing per capita consumption, demand for edible oils is expected to increase. (Source: Technopak)
Ready to cook & ready to eat segments in India
The market for both the segments put together is estimated to be approximately 4,200 Crore in FY 2019-20 and is expected to grow at a high CAGR of 16% doubling itself by FY 2024-25.
The fast-moving consumer goods (FMCG) industry is expected to grow at a CAGR of 27.9% from 2021 to 2027, reaching nearly US$ 615.87 bn. This gain will be ascribed to the projected rise in rural demand as inflation slowly starts to decline. Urban demand is also anticipated to remain steady, supporting the sector''s expansion. By 2025, the number of internet users in India is also projected to reach 1 bn. As an estimated 40% of all FMCG consumption in India is done online, the e-commerce share of total FMCG sales is expected to increase by 11% by 2030. (Source: CRISIL, IBEF)
The Company strives to leverage these opportunities and create innovative products that meet diverse consumer requirements. Further, the Company''s expenditure on marketing and advertising would help to reinforce its brands.
SUBSIDIARIES, JOINT VENTURES, OR ASSOCIATE COMPANIES 1. Modi Biotech Private Limited - wholly owned subsidiary
Modi Biotech Private Limited (MBPL) was formed on 27lh April 2021 to set up a greenfield Ethanol Distillery at Raipur, Chhattisgarh. MBPL has started section-wise trails. We aim to start the production in September 2023.
The Company does not have any Joint Ventures or Associate Companies.
Pursuant to the provisions of Section 129, 134 and 136 of the Act read with rules made thereunder and Regulation 33 of the SEBI Listing Regulations, the Company has prepared consolidated financial statements of the Company and a separate statement containing the salient features of financial statement of subsidiaries in Form AOC-1, which forms part of this Annual Report.
In accordance with Section 136 of the Act, the audited financial statements, including consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries, are available on website of the Company (www.modinaturals.com).
Internal Control Systems and its adequacy
The Company has adequate Internal Control System consistent with the nature of business and size of the operations, to effectively provide for safety of its assets, reliability of financial transactions with adequate checks and balances, adherence to applicable statues, accounting policies, approval procedures and to ensure optimum use of available resources. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis.
The Internal Auditor, the Audit Committee as well as the Board of Directors conduct from time to time an evaluation of the adequacy and effectiveness of the system of internal controls for financial reporting with respect to financial statements.
The Company has adopted Risk Management Policy to proactively take care of the internal and external risks of the company and ensure smooth business operations. The company''s risk management policy ensures that all its material and compliance risk exposures are properly covered, and the company''s business growth and financial stability is assured. At present the Company has not identified any element of risk which may threaten the existence of the Company.
Human Resource and Industrial Relations
The Company lays great emphasis on proper management of human resources and believes that this is the most important ingredient for achieving excellence in performance and sustainable growth. The Management of your Company put utmost efforts to strengthen the existing work force and retaining them to enhance the human resource capability in the Company.
As on 31st March 2023, the Company had 538 employees on its payroll. The Company''s industrial relations are cordial at all locations.
The Directors of your Company deeply appreciate the spirit and commitment of its dedicated team of employees.
The paid-up Equity Share Capital of the Company as at March 31, 2023 stood ? 12,65,63,970. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2023, Mr. Anil Modi, Mr. Akshay Modi and Mrs. Aditi Modi holds 1,30,000, 4,40,000 and 42,000 convertible warrants of the Company respectively. None of the non-executive directors of the Company holds any convertible instruments of the company as on March 31,2023.
ALLOTMENT OF CONVERTIBLE WARRANTS
During the year on 18 May, 2022, the company, pursuant to the shareholders resolution passed at the Extraordinary General Meeting held on 4 May, 2022, issued and allotted 6,50,000 warrants on preferential basis to Promoters and Promoter Group. The said warrants carry an option / entitlement to subscribe to equivalent number of Equity Shares of ?10/- each at a future date, not exceeding 18 (eighteen) months from the date of issue of such warrants at a price of ? 207/- which includes a premium of ?197/-per share determined in accordance with Regulation 76 of the SEBI (Issue of Capital & Disclosure Requirements) Regulations, 2009.
An amount equivalent to 25% of the price has been received on allotment of the Warrants and the balance amount (75%) shall be payable by the Warrant Holders while exercising their options to subscribe for equity shares.
On full conversion, the number of Equity Shares will increase from 1,26,56,397 to 1,33,06,397. The Company has sufficient authorized capital to cover the allotment of these shares.
During the year the Company has not accepted / renewed any deposit from public. The total deposits remained unpaid or unclaimed as at 31st March, 2023 is Nil. There is no default in repayment of deposits or payment of interest thereon during the year.
All related party transactions that were entered into during the financial year were on arm''s length basis and were in the ordinary course of the business. During the year, there were no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with the interest of the Company.
There were no materially significant related party transactions made by the Company during the year that required shareholders'' approval under Regulation 23 of the Listing Regulations. The details of related party transactions are provided in Note 36 to Standalone Financial Statements in accordance with the Accounting Standards.
The Policy on RPTs as approved by the Board is uploaded on the Company''s website https://modinaturals.com/investor-relations/ STATUTORY AUDITORS
The Board of Directors recommends appointment of M/s. Doogar & Associates, Chartered Accountants, (ICAI FRNo. - 000561N) as Statutory Auditors of the Company in place of M/s. K. K. Jain & Co., Chartered Accountants, (ICAI FRNo: 002465N), who have tendered their resignation as Statutory Auditors of the Company. The Board of Directors of the Company at its meeting held on 05.09.2023 have appointed M/s. Doogar & Associates, Chartered Accountants, subject to approval of shareholders at ensuing Annual General Meeting, to hold office from the conclusion of 49th Annual General Meeting till the conclusion of 54 th Annual General Meeting.
The Board recommends to the members of the Company approval of the appointment of M/s. Doogar & Associates, Chartered Accountants, (ICAI FRN - 000561N) as the Statutory Auditors of the Company. Your Company has received a letter from M/s. Doogar & Associates, Chartered Accountants, to the effect that their appointment, if made, would be under the second and third proviso to Section 139 (1) of the Companies Act, 2013 and that they are not disqualified within the meaning of Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014
The Board of Directors at their meeting held on 05.09.2023 appointed M/s. Manisha & Associates, Cost Accountants (FRNo.-000321), as the Cost Auditor for conducting the Cost Audit for the financial year 2023-24. A resolution seeking members'' ratification of the remuneration payable to Cost Auditor is included in the AGM notice. The Cost Audit Report for financial year 2022-23 will be filed within the stipulated period. The Company is maintaining the Cost Records as per Section 148(1) of the Companies Act, 2013.
The Board had appointed M/s Deepak Bansal & Associates, Company Secretaries, to conduct Secretarial Audit of the Company. The Secretarial Audit Report for the financial year ended March 31, 2023 is annexed herewith as âAnnexure Aâ. The Secretarial Audit Report contains a qualification which is self-explanatory and does not require any further comments from the Board of Directors.
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
During the year under review, there has been no change in the Board of Directors and Key Managerial Personnel of the Company.
Pursuant to the provisions of section 152 of the Companies Act, 2013, Mr. Anil Modi, Managing Director, retires by rotation and being eligible offers himself for re-appointment. The Board recommends the re-appointment of Mr. Anil Modi.
The information as required to be disclosed under regulation 36(3) of the SEBI Listing Regulations, 2015 in case of appointment /reappointment of the directors is provided in the AGM Notice.
Key Managerial Personnel
The Key Managerial Personnel of the Company as stipulated under the Companies Act, 2013 are Mr. Anil Modi, Chairman & Managing Director, Mr. Akshay Modi, Joint Managing Director, Mr. Pradeep Kapoor, Chief Financial Officer and Mr. Ankit Agarwal, Company Secretary.
EVALUATION BY THE BOARD
The Board has made a formal annual evaluation of its own performance, Committees of the Board, Independent Directors and Individual Directors of the Company.
The Board''s performance was evaluated based on criteria like Structure, Governance, Dynamics & Functioning, Approval & Review of Operations, Financials, Internal Controls etc. The performance of the Independent Directors as well as Individual Directors including the Chairman of the Board was evaluated based on the evaluation criteria laid down under the Nomination and Remuneration Policy and the Code of Conduct as laid down by the Board.
The Committees of the Board were evaluated individually based on the terms of reference specified by the Board to the said Committee. The Board of Directors were satisfied with the evaluation process which ensured that the performance of the Board, its Committees, Independent Directors, and Individual Directors adhered to their applicable criteria.
SECRETARIAL STANDARDS
The company had complied with the applicable Secretarial Standards issued by ICSI.
CSR INITIATIVES
Modi Naturals'' Corporate Social Responsibility (CSR) activities reflect its philosophy of enhancing value to the society and the environment around us. CSR activities are carried out through registered trust (SLRE Foundation). The Annual Report on CSR activities is annexed herewith as âAnnexure Bâ.
DISCLOSURES:
1. Independent Directors have given declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
2. Salient features of the Nomination and Remuneration Policy is disclosed in the Report on Corporate Governance.
3. Qualification, reservation or adverse remark or disclaimer made by Statutory Auditor in their report: NIL
4. The particulars of Loans, Guarantees and Investments made by the Company under Section 186 of the Companies Act, 2013 are given in Note-5 to the Standalone Financial Statements.
5. Disclosure as required under Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given in Note. 5 & 36 to the Standalone Financial Statements.
6. There are no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status and the Company''s operations in future.
7. Material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report: NIL.
8. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 is annexed herewith as âAnnexure Câ.
9. Annual Return:
Annual Return in Form MGT-7 is available at the Company''s website www.modinaturals.com and the w e b l I n k : https://modinaturals.com/compliance-reports/
10. Particulars of Employees:
There was no employee during the year drawing remuneration exceeding the limits as prescribed under Rule 5(2) of the (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Hence, the information under Rule 5(2) & 5(3) is not applicable.
No Director of the company, including its Managing Director or Whole-Time Director, is in receipt of any commission from the Company or its Subsidiary Company.
11. Disclosures of transactions of the listed entity with any person or entity belonging to the promoter / promoter group which hold(s) 10% or more shareholding in the listed entity, in the format prescribed in the relevant accounting standards for annual results:
Details are given in Note. 36 to the Standalone Financial Statements.
12. Number of other board of directors or committees in which a director is a member or Chairperson, including separately the names of the listed entities where the person is a director and the category of directorship:
Disclosed in the Report on Corporate Governance âAnnexure Dâ.
13. Detailed reasons for the resignation of an independent director who resigns before the expiry of his tenure along with a confirmation by such director that there are no other material reasons other than those provided: Not Applicable
14. Business Responsibility Reporting: Not Applicable
15. Details of Subsidiary Companies, Joint Venture and Associate Companies, and their financial position:
The information as required under the first proviso to sub-section (3) of Section 129 in Form AOC-1 is annexed herewith as âAnnexure Fâ.
16. Details in respect of frauds reported by auditors under section 143(12) of the Companies Act, 2013:
During the year under review, there were no frauds reported by the auditors to the Audit Committee or the Board under section 143(12) of the Companies Act, 2013.
17. List of all credit ratings obtained by the entity along with any revisions thereto during the relevant financial year, for all debt instruments of such entity or any fixed deposit programme or any scheme or proposal of the listed entity involving mobilization of funds, whether in India or abroad:
|
Rating Agency |
Facilities / Instruments |
Rating / Outlook |
|
CARE Ratings |
Long Term Bank Facilities |
CARE BBB-; Stable |
|
CARE Ratings |
Long Term / Short Term Bank Facilities |
CARE BBB-; Stable / CARE A3 |
18. Key Financial Ratios (Explanations for significant change i.e., change of 25% or more as compared to the immediately previous financial year) :
Refer Note 42 to Standalone Financial statements.
19. There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016.
20. There was no instance of one-time settlement with any Bank or Financial Institution.
|
21. Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof: |
|||||
|
Particulars |
2022-23 |
2021-22 |
% Change |
Explanations |
|
|
Return on Net Worth |
0.01 |
0.13 |
(92.30%) |
Increase in net worth and decline in |
|
|
net profit |
|||||
Your company re-affirms its commitment to good corporate governance practices. The company complies with corporate governance requirements specified in Regulation 17 to 27 and Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, whichever applicable.
Pursuant to Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Report on Corporate Governance which forms a part of this Report, has been annexed herewith as "Annexure D".
Chief Executive Officer/Managing Director and Chief Financial Officer have certified to the Board with regard to the financial statements and other matters as required under Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Practicing Company Secretary''s Certificate regarding compliance of conditions of Corporate Governance, is made a part of this Director''s Report. All the Board Members and Senior Management personnel have affirmed compliance with the code of conduct for the year 2022-23.
DIRECTORSâ RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(3)(c) & (ca) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, state that:
i. in the preparation of the annual accounts for the financial year ended March 31, 2023, the applicable accounting standards have been followed:
ii. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended on March 31,2023, and of the profit of the Company for the year ended on that date:
iii. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities:
iv. the directors have prepared the annual accounts on a going concern basis:
v. the directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively: and
vi. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Management Discussion and Analysis forming part of this Report is in compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and such statements may be "forward-lookingâ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied, important factors that could make a difference to the Company''s operations include economic conditions affecting demand / supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors.
The Board takes this opportunity to place on record appreciation to Customers, Distributors, Dealers, Suppliers, Shareholders, Bankers and Government authorities for their continued support and co-operation during the year under review. The Directors also wish to place on record their appreciation to the employees at all levels for their continued co-operation and commitment.
Mar 31, 2018
The Directors present their Forty-Fourth Annual report and Audited Financial Statements for the year ended 31 March 2018.
1. FINANCIAL RESULTS
The financial results of the Company are elaborated in the Management Discussion and Analysis Report.
The highlights of the Financial Results are as under: (Rs. in Lacs)
|
Particulars |
2017-18 |
2016-17 |
|
Total Revenue |
27862.62 |
29317.05 |
|
Total Expenses |
27850.61 |
29303.33 |
|
Profit before interest, depreciation and tax |
419.64 |
435.07 |
|
Profit before exceptional item and tax |
12.02 |
13.71 |
|
Profit / (Loss) before tax |
12.02 |
13.71 |
|
Tax expense |
||
|
-Current Tax |
4.45 |
4.80 |
|
-Deferred Tax |
8.36 |
11.26 |
|
Profit / (Loss) after tax |
5.80 |
2.23 |
|
EPS (face value of Rs.10/- each) |
||
|
-Basic |
0.05 |
0.02 |
|
-Diluted |
0.05 |
0.02 |
2. STATE OF COMPANY AFFAIRS AND FUTURE OUTLOOK
Detailed information on the operations of the Company and details on the state of affairs of the Company are covered in the Management Discussion and Analysis Report.
3. CHANGE IN NATURE OF BUSINESS, IF ANY
Your Company is engaged in the business of edible oils processing and fast moving consumer goods. There was no change in the nature of business of your company during the year.
4. DIVIDEND
No dividend is proposed for the financial year ended March 31, 2018.
5. TRANSFER TO RESERVES
No amount is proposed to be transferred to reserves.
6. SHARE CAPITAL
The paid up equity share capital as on March 31, 2018 stood at Rs. 11,11,79,340. There was no public issue, rights issue, bonus issue or preferential issue during the year. The Company has not issued shares with differential voting rights, sweat equity shares, nor has it granted any stock options. As on March 31, 2018, none of the Directors of the Company holds any instruments convertible into equity shares of the Company.
8. DEPOSITS FROM PUBLIC
During the year, your Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and there is no outstanding amount of deposits at the end of the financial year.
10. EXTRACT OF ANNUAL RETURN
The extract of Annual Return as provided under sub-section (3) of section 92 of the Companies Act, 2013, in the prescribed form MGT-9 is annexed to this Report.
11. NUMBER OF BOARD MEETINGS AND ITS COMMITTEES
Seven (7) meetings of the Board of Directors of the Company were conducted during the year. The details of board and its committees meetings are provided under the Corporate Governance Report which forms part of the Annual Report.
12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Information regarding Loans, Guarantees and Investments covered under Section 186 of the Companies Act, 2013 are detailed in the Financial Statements.
13. RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were on arm''s length basis in the ordinary course of the business and are in compliance with the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. All related party transactions were placed before the Audit Committee and also for the Board approval, wherever required.
There were no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. There are no transactions that are required to be reported in Form AOC-2 hence said form does not form part of this report. However, the details of related party transactions are provided in Note no. 35 to the Financial Statements in accordance with the Accounting Standards.
The Policy on RPTs as approved by the Board is uploaded on the Company''s website www.modinaturals.com
14. AU DITORS AND AU DITORS'' REPORT
Statutory Auditors''
Pursuant to the provisions of section 139 of the Companies Act, 2013, the members at the Annual General Meeting of the Company held on 29th September 2017 appointed Kashyap & Co., Chartered Accountants (Firm Registration No. 011355C) as statutory auditors of the Company from the conclusion of 43 rd Annual General Meeting till the conclusion of 48th Annual General Meeting, covering one term of five consecutive years, subject to ratification by the members at each intervening Annual General Meeting.
In view of the amendment to the said section 139 through the Companies (Amendment) Act, 2017 notified on 7 May 2018, ratification of auditors'' appointment is no longer required. Hence no resolution for ratification of appointment of Auditors is proposed for the Financial Year 2018-19.
The statutory audit report for the year 2017-18 is annexed hereto and forms part of the Annual Report. There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company. The Notes to Accounts referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.
Secretarial Auditors''
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company re-appointed M/s Deepak Bansal & Associates, Company Secretaries to undertake the Secretarial Audit of the Company for the financial year ended March 31, 2018. The Secretarial Audit Report issued by him in the prescribed form MR-3 is annexed to this Report.
The said secretarial audit report does not contain any qualification, reservation or adverse remarks or disclaimer made by the Secretarial Auditor and it is self-explanatory. Thus there is no need to give any further explanation or comment by the Board.
Cost Auditors''
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, the Board at its meeting held on August 9, 2018, on the Audit Committee''s recommendation, recommends the appointment of M/s. Manisha & Associates, Cost Auditors (Firm Registration Number-000321) to audit the cost accounts of the Company for the financial year ending March 31, 2019 at a remuneration of Rs. 60,000/- plus applicable taxes and out of pocket expenses. Resolution seeking Member''s ratification for the remuneration payable to M/s. Manisha & Associates, Cost Auditors is included at Item No.6 of the Notice convening the Annual General Meeting.
The company is maintaining the Cost Records and is in the process to file the Cost Audit Report for the financial year 2017-18 to the Central Government within the stipulated time. (i.e. within 180 days from the end of reporting year)
15. MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year and the date of this Report except as stated below:
ALLOTMENT OF EQUITY SHARES
The Company, on 18 July, 2018, has allotted 1538463 equity shares of Rs. 10/- each as fully paid up on preferential basis to non-promoter group entities pursuant to conversion of Warrants and obtained the listing approval from BSE on 13 August, 2018. The equity shares so allotted rank pari-passu in all respects with the existing equity shares.
Upon the allotment of equity shares, the paid up equity share capital has been increased from Rs. 11,11,79,340 to Rs. 12,65,63,970 comprising of 12656397 equity shares of face value of Rs. 10/- each.
16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The Particulars with regard to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo are given below:
A. Conservation of energy:
i) Steps taken or impact on conservation of energy:
ii) The steps taken by the company for utilizing alternate sources of energy
Your Company has taken adequate measures to ensure optimum use of all equipments so as to conserve energy.
iii) Capital Investment on energy conservation equipments: Nil
B. Technology absorption, adaption and innovation:
The company strives continuously to upgrade its technology adopted in all its operations.
C. Foreign exchange earnings and outgo
a) Earnings - Nil
b) Outgo - Rs. 10,42,286
17. DETAILS OF SUBSIDIARY, JOINT VENTURE OR ASSOCIATES
The Company does not have any Subsidiary/Joint Venture/Associate Company.
18. RISK MANAGEMENT
The Risk Management Policy of the company enables the company to proactively take care of the internal and external risks of the company and ensures smooth business operations. The company''s risk management policy ensures that all its material and compliance risk exposures are properly covered, and the company''s business growth and financial stability is assured. Necessary information is provided under Management Discussion and Analysis Report which forms part of the Annual Report.
19. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
During the year under review there was no change in Directors and Key Managerial Personnel of your company.
The Board recommends the re-appointment of Mr. Sudhir Shankar Halwasiya, Mr. Alok Garg and Mr. Sulabh Singal as Independent Non-Executive Directors of the Company, not liable to retire by rotation, for another term of five consecutive years from 1st April, 2019 upto 31st March, 2024, in terms of Sections 149, 150, 152 read with Schedule IV of the Companies Act, 2013 (''the Act''), and Regulation 17 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
In light of the provisions of the Companies Act, 2013, Mr. Akshay Modi retires from the Board by rotation this year and being eligible, offer himself for re-appointment.
The information as required to be disclosed under regulation 36(3) of the SEBI Listing Regulations, 2015 in case of appointment /re-appointment of the directors is provided in the Notice of the ensuing annual general meeting.
Detailed information on the directors is provided in the Corporate Governance Report.
Key Managerial Personnel
Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. Anil Modi, Chairman & Managing Director, Mr. Akshay Modi, Executive Director, Mr. Pradeep Kapoor, Chief Financial Officer and Mr. Ankit Agarwal, Company Secretary are the Key Managerial Personnel of the Company.
20. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL
There are no significant material orders passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future. However, Members attention is drawn to the statement on contingent liabilities, commitments in the notes forming part of the Financial Statements.
21. INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY
The Company has adequate Internal Financial Controls consistent with the nature of business and size of the operations, to effectively provide for safety of its assets, reliability of financial transactions with adequate checks and balances, adherence to applicable statues, accounting policies, approval procedures and to ensure optimum use of available resources. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis.
The Internal Auditor, the Audit Committee as well as the Board of Directors conduct from time to time an evaluation of the adequacy and effectiveness of the system of internal controls for financial reporting with respect to financial statements.
Details of internal financial controls and its adequacy are included in the Management Discussion and Analysis Report, which forms part of the Annual Report.
22. FRAUD
Neither the Statutory Auditors nor the Secretarial Auditors have brought to the notice of the Audit Committee or the Board of Directors or the Central Government the occurrence or brewing of any fraud in the Company.
23. PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company''s shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.
24. DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL ETC.
Details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are annexed to this Report.
The details of remuneration paid to the directors including executive directors of the Company are given in Form MGT-9 forming part of this Report.
25. PARTICULARS OF EMPLOYEES
There was no employee during the year drawing remuneration exceeding the limits as prescribed under Rule 5(2) of the (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Hence, the information under Rule 5(2) & 5(3) is not applicable.
26. CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and Senior Management Personnel in the course of day to day business operations of the Company. The Code has been posted on the Company''s website (www.modinaturals.com).
The Chairman & Managing Directors'' declaration regarding compliance with ''Modi Naturals'' Code of Conduct for Board Members and Senior Management'' is attached to the Corporate Governance Report.
27. CORPORATE GOVERNANCE
Pursuant to SEBI Listing Regulations, 2015, a separate chapter titled ''Corporate Governance'' has been included in this Annual Report, along with the reports on Management Discussion and Analysis and General Shareholder Information.
All Board members and Senior Management personnel have affirmed compliance with the Code of Conduct for the year 2017-18. A declaration to this effect signed by the Managing Director (CEO) of the Company is contained in this Annual Report.
The Managing Director and CFO have certified to the Board with regard to the financial statements and other matters as required under regulation 17 (8) of the SEBI Listing Regulations, 2015.
Certificate from the Auditors of the Company regarding compliance of conditions of corporate governance is annexed to this Report.
28. CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY
The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility are not applicable on the Company.
29. ANNUAL EVALUATION OF THE PERFORMANCE OF BOARD, ITS COMMITTEES, CHAIRPERSON & INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has through mutual discussions carried out an annual evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees.
The Nomination and Remuneration Committee ("NRC") evaluated the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.
In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was reviewed, taking into account the views of executive directors and non-executive directors of the company.
Declaration by Independent Directors
The Company has received necessary declaration from each independent director under Section 149 (7) of the Companies Act, 2013 that they meet the meet the criteria of independence laid down in Section 149(6) of the Act and regulation 25 of the Listing Regulations.
30. REMUNERATION POLICY
Information regarding Directors'' Remuneration Policy and criteria for determining qualifications, positive attributes, independence of a director and other matters provided under sub-section (3) of section 178 are provided in the Corporate Governance Report. The Remuneration Policy is placed on the Company''s website at www.modinaturals.com
31. WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Your Company has established a whistle blower policy/vigil mechanism for the Directors, employees of the company, to report genuine concerns, calling the attention of the Audit Committee to some wrongdoing occurring within an organization. Your Company has also provided adequate safeguards against victimization of whistleblowers who express their concerns against such wrongdoings occurring in the organization. The Company has also provided direct access to the chairman of the Audit Committee, in exceptional circumstances.
During the year, there were no instances of unethical behaviour, fraud or violation of the company''s code of conduct or ethics policy and no personnel have been denied access to the audit committee. The details of establishment of such mechanism are disclosed on the website of the Company viz. (www.modinaturals.com).
32. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE, (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
Pursuant to the legislation ''The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013'', the Company has a Policy on Prevention of Sexual Harassment at Workplace and also has Internal Complaints Committee. During the year under review, no compliant was received from any employee under the said Policy.
33. SECRETARIAL STANDARDS
The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.
34. DIRECTORS'' RESPONSIBILITY STATEMENT
As required under clause (c) of sub-section (3) of section 134 of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, state that:
i. in the preparation of the annual accounts for the financial year ended March 31, 2018, the applicable accounting standards have been followed with proper explanation relating to material departures;
ii. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended on 31st March, 2018, and of the profit of the Company for the year ended on that date;
iii. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. the directors have prepared the annual accounts on a going concern basis;
v. the directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;
vi. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
34. ACKNOWLEDGEMENTS
The Board of Directors take this opportunity to thank all its Shareholders, valued customers, banks, Government and Statutory Authorities, Investors and the Stock Exchange for their continued support to the Company. Your Directors also wish to place on record their deep sense of appreciation for the committed services by your Company''s employees. Your Directors acknowledge with gratitude the encouragement and support extended by our valued Shareholders and the Promoters of the Company.
On behalf of the Board of Directors
Sd/-
Anil Modi
Chairman and Managing Director
New Delhi, August 9, 2018 DIN No.:00187078
Mar 31, 2016
DIRECTORS'' REPORT
To the Members,
The Directors are pleased to present the 42nd Annual Report and Audited Accounts of the Company for the financial year ended March 31, 2016.
1. Financial highlights
The summarized financial results for the year ended March 31, 2016 and for the previous year ended March 31, 2015 are as follows: -
(in lakh)
|
Particulars |
2015-16 |
2014-15 |
|
Revenue from Operations / Net Sales |
26930.35 |
23194.87 |
|
Other Income |
243.09 |
199.81 |
|
Profit before interest, depreciation and tax |
886.24 |
421.64 |
|
Profit before exceptional item and tax |
419.23 |
14.52 |
|
Profit before tax |
419.23 |
14.52 |
|
Tax expense |
|
|
|
-Current Tax |
94.00 |
7.58 |
|
-Deferred Tax |
128.34 |
(8.84) |
|
Profit after tax |
196.88 |
15.78 |
|
EPS (face value of Rs.10/- each) |
|
|
|
-Basic & Diluted |
1.77 |
0.14 |
The Company achieved gross turnover including other income of Rs 27,173.44 Lacs and posted net profit of Rs.196.88 Lacs for the financial year ended on 31st March, 2016 as against gross turnover including other income of Rs. 23,394.68 Lacs and net profit of Rs. 15.78 Lacs in the previous financial year.
2. State of company affairs and future outlook
In the current financial year, the company continues to focus on growth of its branded business and is confident that the consumer business will continue its steady growth, which is in line with our medium to long term strategy; The flagship brand where the company is seeing a growing leadership position is:
Oleev - olive oils and healthy oils
Other than that we have developed the following value added products:
Rizolo - India''s Finest - Rice Bran Oil
Miller - Canola Oil with low absorption technology
Olivana Wellness - massage oils.
Whilst Rizolo and Miller have a direct fit in the edible oil stable, Olivana Wellness is the company''s foray into the personal care segment of FMCG. With the launch of the new brands of packaged edible oils, the focus is slowly tilting more towards enhancing value through well branded consumer focused products. The Company is also creating niche brands in edible oils and blended oils which have various health benefits and thereby commanding a premium in the marketplace.
By increasing its foothold across all major distribution platforms like wholesale, modern retail, ecommerce etc., the Company is poised to strengthen its brand presence across the country. The Company has launched its largest advertisement campaign until now to strengthen its brand presence and improving brand recall.
In the years to come, Modi Naturals visualizes itself as a major contributor to the Indian FMCG sector and primarily the branded edible oil industry
3. Change in nature of business
The Company is engaged in the business of manufacturing and marketing of Edible oil and De-oiled cake. There was no change in the nature of business of your company during the year.
4. Dividend
No dividend is proposed for the financial year ended March 31, 2016.
5. Transfer to reserves
No amount is proposed to be transferred to reserves.
6. Change in Share Capital
Your Company has neither issued any equity shares with differential rights nor granted any employees stock options / sweat equity shares to the directors, officers or employees of the Company during the year.
7. Deposits from public
During the year, your Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 and there is no outstanding amount of deposits at the end of the financial year.
8. Extract of Annual Return
As provided under Sections 134(3) (a) and 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of annual Return in Form MGT-9 is given in "Annexure-1" which forms part of this report.
9. Number of Board Meetings
During the financial year ended March 31, 2016, the Company had ten (10) Board meetings on April 10, 2015, May 30, 2015, August 12, 2015, September 2, 2015, October 15, 2015, November 14, 2015, November 30, 2015, January 27, 2016, February 3, 2016, and March 30, 2016 respectively.
10. Particulars of loans, guarantees and investments
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Note no. 14 and 19 to the Financial Statements.
11. Particulars of contracts or arrangements with related parties
All related party transactions that were entered into during the year were on arm''s length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large. The details of related party transactions are provided in Note no. 34 to the Financial Statements.
During the year, pursuant to Section 177 of the Companies Act, 2013 and erstwhile Clause 49 of the Listing Agreement and/ or Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, all related party transactions were placed before the Audit Committee and also for the Board approval, wherever required.
12. Auditors and Auditors'' Report Statutory Auditors''
Pursuant to the provisions of Section 139 of the Act and the rules framed there under, Messrs K. K. Jain & Co., Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the 40th annual general meeting (AGM) of the Company held on August 19, 2014 till the conclusion of the 43rd Annual General Meeting, subject to ratification of their appointment at every Annual General Meeting. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly the appointment of Messrs K. K. Jain & Co, Chartered Accountants, as statutory auditors of the Company, is placed for ratification by the shareholders at the 42nd Annual General Meeting of the Company. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.
There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company The Notes to Accounts referred to in the Auditors'' Report are self-explanatory and d o not call for any further comments.
Secretarial Auditors''
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Deepak Bansal & Associates, Company Secretaries to undertake the Secretarial Audit of the Company The Secretarial Audit Report is annexed herewith as "Annexure 2".
The said Secretarial Audit Report has no qualification, reservation or adverse remarks and it is self-explanatory; Thus there is no need to give any further explanation or comment by the Board.
Cost Auditors''
Based on the Audit Committee''s recommendations at its meeting held on August 8, 2016 and subject to approval by the Central Government, the Board recommends the appointment of M/s. Manisha & Associates as the Cost Auditors of the Company for the year ended on March 2016-17 at a remuneration of Rs. 60000/- plus traveling, lodging and boarding expenses. The remuneration payable to the Cost Auditors for the financial year 2016-17 requires ratification by the members at the ensuing annual general meeting.
The cost audit report for the financial year 2014-15 has been filed to the Central Government vide SRN S42517854 dated 28.10.2015. The Cost Audit Report for the financial year 2015-16, prescribed under Cost Audit Rules, 2014, is due to be filed with MCA on or before 30.09.2016 (being within 180 days from the end of reporting year).
13. Material changes affecting the financial position of the company
There are no material changes affecting the financial position of the Company.
14. Conservation of energy, technology absorption, foreign exchange earnings and outgo
The Particulars with regard to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo are given below:
A. Conservation of energy:
i) Steps taken or impact on conservation of energy:
ii) The steps taken by the company for utilizing alternate sources of energy
Your Company has taken adequate measures to ensure optimum use of all equipments so as to conserve energy
iii) Capital Investment on energy conservation equipments: Nil
B. Technology absorption, adaption and innovation:
The company strives continuously to upgrade its technology adopted in all its operations.
C. Foreign exchange earnings and outgo
a) Earnings - Nil
b) Outgo - Rs. 486105
16. Details of subsidiary, joint venture or associates
The Company does not have any Subsidiary/Joint Venture/Associate Company.
17. Risk management
The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.
18. Directors and key managerial personnel (KMP)
Ms. Purva Satija, Company Secretary and Compliance Officer of the Company resigned on 30.04.2015. On the basis of recommendation of Nomination and Remuneration Committee, the Board of Directors at its meeting held on 15th October, 2015 has appointed to Mr. Ankit Agarwal as Company Secretary from 15th October, 2015 in terms of pro vision of the Companies Act, 2013 and rules made there under.
Pursuant to Section 152 and other applicable provisions, if any of the Companies Act, 2013, Mr. Ani l Modi, Director of the Company retires by rotation at the ensuing Annual General Meeting, and being eligible, offers himself for re-appointment in accordance with the provisions of the said Act.
The Board of Directors in their meeting held on 08th August, 2016 has recommended to re-appoint Mr. Akshay Modi as Executive Non-Independent Director within the meaning of Section 196, 197 and 203 of the Companies Act, 2013 read with Schedule IV thereto and Rules made there under, for a further period of 3 (three) years from December 15, 2016 commencing immediately after the expiry of his current tenure on December 14, 2016, subject to retirement by rotation.
The Nomination and Remuneration Committee of the Board in its meeting held on 08th August, 2016 has considered and recommended the aforesaid re-appointments of Mr. Anil Modi and Mr. Akshay Modi to the Board for their approval.
The Board has considered that the presence of Mr. Anil Modi and Mr. Akshay Modi as Directors on the Board would be of immense benefit to the Company and has decided to recommend their reappointment for the approval of members of the Company at the ensuing annual general meeting of the company
A brief resume of the Directors being appointed/ re-appointed, are furnished in the explanatory statement to the notice of the ensuing AGM.
19. Details of significant & material orders passed by the regulators or courts or tribunal
There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.
20. Internal financial controls
Your Company has a proper and adequate system of internal financial controls. This ensures that all assets are safeguarded and protected against loss from unauthorized use or disposition and the transactions are authorized, recorded and reported correctly. The internal financial control system has been designed to ensure that the financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.
Audit Committee periodically reviews the performance of internal audit function and discusses internal audit reports with the Internal Auditor
21. Fraud
Neither the Statutory Auditors nor the Secretarial Auditors have brought to the notice of the Audit Committee or the Board of Directors or the Central Government the occurrence or brewing of any fraud in the Company.
22. Code of conduct for regulating and reporting trading by insiders and for fair disclosure, 2015
Your Company has adopted the "Code of Conduct for regulating & reporting trading by insiders and for fair disclosure, 2015" which, inter alia, prohibits purchase or sale of securities of the Company by Directors, employees and other connected persons while in possession of unpublished price sensitive information in relation to the Company
23. Disclosure of ratio of remuneration of directors and key managerial personnel
As required under Section 197(12) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the details of the ratio of the remuneration of each director to the median employee''s remuneration and such other details as prescribed therein are given in "Annexure-3, which is attached hereto and forms a part of the Directors'' Report.
24. Particulars of employees
The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, names and other particulars in respect of employees of the Company are required to be attached to the Directors'' Report. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and other entitled thereto, excluding the information on employees'' particulars required to be disclosed in this report. The said information is available for inspection at Registered Office of the Company during the working hours and any member interested in obtaining such information may write to the Company Secretary
25. Personnel
Your Company aims to be a preferred employer in the industry and remains committed to developing its employees to meet the current and future challenges of the business.
26. Code of conduct
The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and Senior Management Personnel in the course of day to day business operations of the Company. The Code has been posted on the Company''s website (www.modinaturals.com).
27. Audit committee
The details pertaining to composition of Audit Committee are included in the Corporate Governance Report which forms part of this report.
28. Corporate governance
Your Company has complied with the requirements and disclosures that have to be made under the Code of Corporate Governance as required under Regulation 27(2) of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. Pursuant to Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") the Company has executed fresh Listing Agreement(s) with the Stock Exchange(s).
As a listed company necessary measures are taken to comply with the Listing Agreement with the Stock Exchange. A report on Corporate Governance, along with a certificate of compliance from the Statutory Auditors, forms part of this Annual Report. The Chairman & Managing Directors'' declaration regarding compliance with ''Modi Naturals'' Code of Conduct for Board Members and Senior Management'' is attached to the Corporate Governance Report.
29. Corporate social responsibility (CSR) policy
The provisions of the Companies Act, 2013 relating to Corporate Social Responsibility are not applicable on the Company
30. Annual evaluation of board, committees & directors'' performance
Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The manner in which the evaluation has been carried out has been explained hereunder.
A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.
In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was reviewed, taking into account the views of executive directors and nonexecutive directors of the company.
Declaration from Independent Directors
As required by Section 149 (7) of the Companies Act, 2013, All Independent Directors of the Company have made declaration to the effect that they meet the criteria of independence as stipulated under Section 149(6) of the Act.
31. Remuneration policy
The Nomination and Remuneration Committee recommend the appointment of Director, and their appointment or reappointment, based on their qualifications, professional experience, positive attributes, view points, skills and area of expertise and independence. The Company follows a policy on remuneration of Directors and Senior Management employees, details of the same are given in the Corporate Governance Report. The Remuneration Policy has been posted on the Company''s website (www.modinaturals.com).
32. Whistle blower / vigilance policy
Your Company has established a whistle blower policy/vigil mechanism for the Directors, employees of the company, to report genuine concerns, calling the attention of the Audit Committee to some wrong doing occurring within an organization. Your Company has also provided adequate safeguards against victimization of whistleblowers who express their concerns against such wrongdoings occurring in the organization. The Company has also provided direct access to the chairman of the Audit Committee, in exceptional circumstances.
During the financial year 2015-16, there were no instances of unethical behaviour, fraud or violation of the company''s code of conduct or ethics policy and no personnel have been denied access to the audit committee. The details of establishment of such mechanism are disclosed on the website of the Company viz. (www.modinaturals.com).
33. Disclosure under sexual harassment of women at workplace, (prevention, prohibition & redressal) act, 2013
Your company did not come across any complaints by any employee during the year under review relating to the sexual harassment.
34. Directors'' responsibility statement
Pursuant to Section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability confirm that:
i. in the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures;
ii. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
iii. the directors had 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;
iv. the directors had prepared the annual accounts on a going concern basis;
v the directors had laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively;
vi. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
35. Acknowledgements
The Board of Directors take this opportunity to thank all its Shareholders, valued customers, banks, Government and Statutory Authorities, Investors and the Stock Exchange for their continued support to the Company Your Directors also wish to place on record their deep sense of appreciation for the committed services by your Company''s employees. Your Directors acknowledge with gratitude the encouragement and support extended by our valued Shareholders and the Promoters of the Company.
On behalf of the board of directors
Sd/-
Anil Modi
Place: New Delhi Chairman and Managing Director
Date: 08th August, 2016 DIN No.: 00187078
Mar 31, 2014
Dear Members,
The Directors hereby present the 40th Annual Report and Audited
Accounts of the Company for the Financial Year ended on March 31, 2014.
PERFORMANCE
The summarized financial results for the year ended March 31, 2014 and
for the previous year ended March 31, 2013 are as follows.
(Rs. in Lacs)
2013-14 2012-13
Sales and Other Income 20982.52 19456.11
Profit before interest and depreciation 448.33 584.81
Interest 142.75 142.75
Profit before Depreciation and Tax 305.58 442.06
Depreciation 141.67 136.82
Profit before Taxation 163.91 305.24
Provision for Taxation 39.73 70.55
Short provision for Taxes for earlier years 5.31 0.73
Provision for Deferred Tax 36.60 30.65
Profit after Taxation 82.27 203.31
Balance brought forward from previous year 810.25 606.94
Amount available for appropriation 82.27 203.31
Appropriation
Surplus carried to Balance Sheet 892.52 810.25
DIVIDEND
The Directors do not recommend any dividend for the year under review.
DIRECTORS
Shri Anil Modi, Chairman & Managing Director and Shri Akshay Modi,
Executive Director retire by rotation at the ensuing Annual General
Meeting, and, being eligible, offers himself for re-appointment.
The Board has recommended to fix the term of Shri Sudhir Shankar
Halwasiya, Shri Alok Garg and Shri Sulabh Singal ,the existing
Independent Directors of the Company upto March 31. 2019.The Board has
also recommended re-appointment of Shri Anil Modi as Managing Director
for a further term of five years with effect from January 1, 2015. The
particulars of Directors proposed to be appointed/re-appointed, as the
case may be, are given in the Corporate Governance Report of this
Annual Report.
DEPOSITS
There are no unclaimed deposits and the Company has not accepted any
new deposits during the year under review.
AUDITORS
Messrs K. K. Jain & Co., Chartered Accountants, New Delhi , Statutory
Auditors of the Company, holds office until the conclusion of the
ensuing Annual General Meeting and are eligible for re-appointment.
The Board of Directors recommend to the Members of the Company for the
reappointment of Messrs. K. K. Jain & Co., Chartered Accountants, as
Statutory Auditors of the Company to hold the office for a term of
three years from the conclusion of ensuing 40th Annual General Meeting
of the Company till the conclusion of 43rd Annual General Meeting of
the Company.
ACCOUNTS AND AUDIT REPORT
There are no qualifications made by the Auditors in their Report which
requires any explanation from the Board of Directors of the Company.
The Notes to Accounts referred to in the Auditors'' Report are
self-explanatory and do not call for any further comments.
COST AUDITORS
Based on the Audit Committee recommendations at its meeting held on May
30, 2014 and subject to approval by Central Government, the Board
recommends the appointment of M/s. Manisha Taiyal & Associates as the
Cost Auditors of the Company for the year ended on March 31, 2015.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars, as prescribed under sub-section 1(e) of Section 217 of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules, 1988 are
given in the Annexure which forms part of this report.
PARTICULARS OF EMPLOYEES
During the year, there were no employees who were in receipt of
remuneration more than the limits prescribed under Section 217(2A) of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975.
PERSONNEL
Identifying employees with high potential to grow and grooming them for
competitive positions has been a constant effort of your Company. Your
Company aims to be a preferred employer in the industry and remains
committed to developing its employees to meet the current and future
challenges of the business.
DIRECTORS'' RESPONSIBILITY STATEMENT
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Directors of your
Company hereby confirm that:
a) the applicable Accounting Standards have been followed in the
preparation of final accounts and that there are no material
departures;
b) such accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a true and fair view of the state of affairs of your Company as
at March 31, 2014 and of the profit of your Company for the year ended
on that date;
c) 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 your Company and for
preventing and detecting fraud and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
CORPORATE GOVERNANCE
Your Company has complied with the requirements and disclosures that
have to be made under the Code of Corporate Governance as required
under Clause 49 of the Listing Agreement entered into with the BSE
Limited (BSE) (the "Stock Exchange"). As a listed company, necessary
measures are taken to comply with the Listing Agreement with the Stock
Exchange. A report on Corporate Governance, along with a certificate of
compliance from the Statutory Auditors, forms part of this Annual
Report. The Chairman & Managing Directors'' declaration regarding
compliance with ''Modi Naturals Limited Code of Conduct for Board
Members and Senior Management'' is attached to the Corporate Governance
Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis is presented in a separate
section, which forms part of the Annual Report.
ACKNOWLEDGEMENTS
The Board of Directors take this opportunity to thank all its
Shareholders, valued customers, banks, Government and Statutory
Authorities, Investors and the Stock Exchange for their continued
support to the Company. Your Directors also wish to place on record
their deep sense of appreciation for the committed services by your
Company''s employees. Your Directors acknowledge with gratitude the
encouragement and support extended by our valued Shareholders and the
Promoters of the Company.
On behalf of the Board of Directors
sd/-
New Delhi (Anil Modi)
July 8, 2014 Chairman & Managing Director
Mar 31, 2013
To the Members,
The Directors hereby present the 39th Annual Report and Audited
Accounts of the Company for the Financial Year ended on March 31, 2013.
PERFORMANCE
The summarized fnancial results for the year ended March 31, 2013 and
for the previous year ended March 31, 2012 are as follows: -
(Rs.in Lacs)
2012-13 2011-12
Sales and Other Income 19456.11 16683.19
Proft before interest and depreciation 584.82 346.50
Interest 142.76 157.85
Proft before Depreciation and Tax 442.06 188.65
Depreciation 136.82 137.82
Proft before Taxation 305.50 50.83
Provision for Taxation 70.55 12.49
Short provision for Taxes for earlier years 0.73
Provision for Deferred Tax 30.65 19.15
Proft after Taxation 203.31 19.19
Balance brought forward
from previous year 606.94 587.75
Amount available for appropriation 203.31 19.19
Appropriation
Surplus carried to Balance Sheet 810.25 606.94
DIVIDEND
The Directors do not recommend any dividend for the year under review.
DIRECTORS
Shri Sudhir Shankar Halwasiya, retires by rotation at the ensuing
Annual General Meeting, and, being eligible, ofers himself for
re-appointment. Shri Sulabh Singal was inducted as an Additional
Director on the Board with efect from July 30, 2013. His ofce as
Additional Director will expire at the ensuing Annual General Meeting.
Your Directors recommend appointment of Shri Sudhir Shankar Halwasiya
and Shri Sulabh Singal as Directors of the Company.
The Board has recommended revision in the remuneration of Shri Anil
Modi, Managing Director and Shri Akshay Modi, Executive Director of the
Company with efect from October 1, 2013 for the remainder of their
tenure. The Board has also recommended re-appointment of Mr Akshay Modi
for a further term of three years with efect from December 15, 2013.
DEPOSITS
The Company has renewed the deposits and there are no unclaimed
deposits during the year.
AUDITORS
M/s. K. K. Jain & Co., Chartered Accountants were the statutory
auditors of the Company for the year ended on March 31, 2013. They
retire at the conclusion of the ensuing Annual General Meeting and are
eligible for re-appointment. M/s K.K.Jain & Co. have indicated their
willingness to be re-appointed as Statutory Auditors of Company. The
Board recommends their re-appointment as Statutory Auditors of the
Company.
ACCOUNTS AND AUDIT REPORT
There are no qualifcations made by the Auditors in their Report which
requires any explanation from the Board of Directors of the Company.
COST AUDITORS
Based on the Audit Committee recommendations at its meeting held on May
30, 2013, the Company has appointed M/s. Manisha Taiyal & Associates
as the Cost Auditors of the Company for the year ended on March 31,
2014.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars, as prescribed under sub-section 1(e) of Section 217 of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules, 1988 are
given in the Annexure which forms part of this report.
PARTICULARS OF EMPLOYEES
During the year, there were no employees who were in receipt of
remuneration more than the limits prescribed under Section 217(2A) of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended from time to time.
PERSONNEL
Identifying employees with high potential to grow and grooming them for
competitive positions has been a constant efort of your Company. Your
Company aims to be a preferred employer in the industry and remains
committed to developing its employees to meet the current and future
challenges of the business.
DIRECTORS'' RESPONSIBILITY STATEMENT
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Directors of your
Company hereby confrm that:
a) the applicable Accounting Standards have been followed in the
preparation of fnal accounts and that there are no material departures;
b) such accounting policies have been selected and applied consistently
and the judgments and estimates made are reasonable and prudent so as
to give a true and fair view of the state of afairs of your Company as
at March 31, 2013 and of the proft of your Company for the year ended
on that date;
c) proper and sufcient 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 your Company and for
preventing and detecting fraud and other irregularities; and
d) the annual accounts have been prepared on a going concern basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with Stock Exchanges,
Reports on Management Discussion and Analysis and on Corporate
Governance have been included elsewhere in this Report as separate
sections. A certifcate from M/s K K Jain & Co., Chartered Accountants
confrming compliance with Clause 49 of the Listing Agreement has also
been included in the Annual Report. Further, as required under the
Clause 49, your Company has adopted a ''Code of Conduct and Ethics for
its Directors and Senior Executives''.
ACKNOWLEDGEMENTS
The Directors'' express their gratitude to the employees of the Company
for their commitment, dedication and support in fulflling Company''s
commitments to its customers and thereby contributing to the
performance of the Company. They would also like to express their
gratitude to various Government/ Regulatory authorities, customers,
vendors, Banks and members for their continued understanding and
support during the Financial Year ended on March 31, 2013 and look
forward to the same in the years to come.
On behalf of the Board of Directors
sd/-
Place : New Delhi (Anil Modi)
Date : August 30, 2013 Chairman
Mar 31, 2012
To the Members,
The Board of Directors hereby presents the 38th Annual Report on the
business and operations of your Company along with the Audited
Financial Statements for the year ended 31st March, 2012.
PERFORMANCE
The summarized financial results for the year ended 31st March, 2012
and for the previous year ended 31st March, 2011 are as follows: -
(Rs. in Lacs)
2011-12 2010-11
Sales and Other Income 16683.19 11090.41
Profit before interest and depreciation 346.50 246.85
Interest 157.85 126.20
Profit before Depreciation and Tax 188.65 120.65
Depreciation 137.82 118.02
Profit before Taxation 50.83 2.63
Provision for Taxation 12.49 1.86
Short provision for Taxes for earlier years - 0.49
Provision for Deferred Tax 19.15 (3.63)
Profit after Taxation 19.19 3.91
Balance brought forward from previous year 587.75 583.84
Amount available for appropriation 606.94 587.75
Appropriation
Surplus carried to Balance Sheet 606.94 587.75
DIVIDEND
The Directors do not recommend any dividend for the year under review.
CORPORATE GOVERNANCE
Report on the Corporate Governance along with the certificate of the
Auditors, confirming compliance of condition of Corporate Governance as
stipulated under Clause 49 of the Listing Agreement, forms part of the
Annual Report.
DIRECTORS
Out of the present Directors, Shri Alok Garg, retires by rotation, and,
being eligible, offers himself for re-appointment. Your Directors
recommend re-appointment of Shri Alok Garg as Director on the Board.
DEPOSITS
The Company has not accepted any fresh deposits during the year.
AUDITORS
The present Auditors M/s. K. K. Jain & Co., Chartered Accountants
retire at the conclusion of the Annual General Meeting. They have
furnished a certificate u/s 224(1 B) of the Companies Act, 1956 and are
eligible for re-appointment. Your Directors recommend re-appointment of
M/s K. K. Jain & Co., as Auditors of the Company at the ensuing Annual
General Meeting of the company.
ACCOUNTS AND AUDIT REPORT
There are no qualifications made by the Auditors in their Report which
requires any explanation from the Board of Directors of the Company.
COST AUDITORS
The Ministry of Corporate Affairs (MCA) has introduced The Companies
(Cost Audit Report) Rules, 2011 vide its notification no. GSR 430(E)
dated June 3, 2011. These rules make it mandatory for industries to
appoint a Cost Auditor within 90 days of the commencement of the
Financial Year. The Cost Audit Order No. 52/26/CAB/2010 dated January
24, 2012 covers your Company's manufacturing operations w.e.f. April 1,
2012. Based on the Audit Committee recommendations at its meeting held
on February 9, 2012, the Board has appointed M/s Manisha Taiyal &
Associates as the Cost Auditors of the Company for the Financial Year
2012-2013.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information required to be furnished in terms of Section 217(1)(e) of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 relating
to Conservation of Energy, Technology Absorption & Foreign Exchange
Earnings & outgo is annexed herewith & forms part of this report.
GREEN INITIATIVE
Your Company wishes to be a part of green initiative of the Ministry of
Corportate Affaires (MCA) so as to contribute towards a greener
environment. Your Company proposes to send its annual report and other
communications electronically to its shareholders and to enable your
Company to do so, it is requested that shareholders may kindly fill in
their e-mail ID details (in an enclosure annexed to this Annual Report)
and send it back to the Company Secretary / Registrar and Share
Transfer Agent of the Company.
PARTICULARS OF EMPLOYEES
During the year there were no employees who were in receipt of
remuneration more than the limit prescribed under Section 217(2A) of
the Companies Act, 1956, read with Companies (Particulars of Employees
) Rules, 1975 as amended.
PERSONNEL
The relations with the employees of the Company continued to be
cordial. Your Directors wish to place on record their appreciation for
the excellent work done by the employees at all levels.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors
hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards have been followed and that there are no material departures;
b) they have, in the selection of the Accounting policies, consulted
the Statutory Auditors and have 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;
c) they have taken proper and sufficient care to the best of their
knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956,
for safeguarding the assets of the Company and for preventing and
detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis.
ACKNOWLEDGEMENTS
Your Directors express their sincere gratitude and deep appreciation
for the co-operation and assistance given by the financial
institutions, banks, suppliers and customers of the Company during the
year under report and look forward to their continued support. Your
Director's also thankfully acknowledge the trust and confidence reposed
by you in the Company.
On behalf of the Board of Directors
sd/-
Place : New Delhi (Anil Modi)
Date : September 4, 2012 Chairman
Mar 31, 2010
The Directors have pleasure in presenting the 36th Annual Report of
the Company together with the Audited Accounts for the yearended 31st
March, 2010.
OPERATING RESULTS
The summarized financial results for the yearended 31st March, 2010 and
for the previous yearended 31st March, 2009 are
as follows: -
(in Lacs)
2009-10 2008-09
Turnover 11580.85 12091.47
Profit before interest
and depreciation 403.45 595.69
Interest 136.73 105.96
Depreciation 107.21 78.13
Profit for the year 159.49 411.60
The turnover of the company has gone down from Rs 120.91 croresto Rs
115.81 crores. However, the companys Rice Bran processing has gone up
by 12% i.e. from 70857 tons to 79224 tons. The decrease in turnover is
actually on account of increase in stock of Finished Goods (from Rs
9.04 crores to Rs 13.08 crores) and fall in Indian edible oil commodity
prices.The main reason for a fall in edible oil prices is excessive
dumping of vegetable oil market by cheap imported oils - mainly crude
palm oil. This has also resulted in decrease of Net Realizable Value
of Refined Rice Bran oil by 13% over last year.
On the other hand, the prices of raw materials i.e. mainly Rice Bran
have not gone down as significantly as oil prices, resulting in
decrease in Gross Profit margin.
OPERATIONS
In the last 2 years, the company has invested over Rs 10 crores for
upgrading its production facilities and also setting up new packaging
lines. As a result of this there is an increase in financing (from Rs
1.17 crores to Rs 1.47 crores) and depreciation costs (from Rs 0.78
crores to Rs 1.07 crores). The companys new business division called
Branded Business has resulted in increase in personnel (from Rs 2.17
crores to Rs 2.66 crores) & administrative expenses (from Rs 0.49
crores to Rs 0.87 crores) of the company. As a result, the companys
profit has gone down in current year. However, the benefits of these
investments shall occur in coming years.
FOREIGN INSTITUTIONAL INVESTORS
Pursuant to Foreign Investment Promotion Board (FIPB) approval,
26,40,000 optionally convertible warrants have been issued on
preferential basis to three Flls on 5,h August 2010. After the
conversion of these warrants into equity shares, the paid up capital of
the company shall become Rs 11,11,79,340.
GOING FORWARD
The company has structured its operations into three divisions -
Branded Business, Bulk Commodities and Value Added Products. The new
structure will refocus your companys efforts, unlock embedded value
and result in accelerated growth on all fronts. Adetailed report on
this is given in the CEOs message.
DIVIDEND
In order to conserve the resources for the growth of the company, the
Directors do not recommend any dividend for the year under review.
CORPORATE GOVERNANCE
Report on the Corporate Governance along with the certificate of the
Auditors, confirming compliance of condition of corporate governance as
stipulated under Clause 49 of the Listing Agreement, forms part of the
Annual Report.
DIRECTORS
Out of the present Directors, Shri Alok Garg, retires by rotation, and,
being eligible, offers himself for re-appointment. Your Directors
recommend re-appointment of Shri Alok Garg on the Board.
DEPOSITS
The company has not accepted any fresh deposits during the year. There
were no overdue deposits.
AUDITORS
The present Auditors Messrs K. K. Jain & Co., Chartered Accountants
retire at the conclusion of the Annual General Meeting. They have
furnished a certificate u/s 224(1 B) of the Companies Act, 1956 and are
eligible for re-appointment. Your Directors recommend re-appointment of
M/s K.K.Jain & Co., as auditors of the Company at the ensuing Annual
General Meeting.
ACCOUNTS AND AUDIT REPORT
The Auditors comment in their Auditors Report at para 3 (vi) along with
the management reply is as follows:-
In our opinion and to the best of our information and according to the
explanations given to us, the Balance Sheet and the Profit & Loss
Account read with the Schedules and Notes thereon and subject to the
consequential impact on the result for the year of Note No. B6 of
Schedule 23 regarding non-disclosure of additional information required
under clause 22 of Chapter V of Micro, Small and Medium Enterprises
Development Act, 2006 give the information required by the Companies
Act, 1956 in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India:
The company has not been able to provide disclosure of additional
information as required under clause 22 of Chapter V of Micro, Small
and Medium Enterprises Development Act, 2006 due to non receipt of any
intimation from its suppliers regarding their status under The Micro,
Small and Medium Enterprises Development Act, 2006 and hence the
following information required under the said Act could not be provided
by the company :-
a) Delayed payments due as at the end of each accounting year on
account of principal and interest thereon.
b) Total interest paid on all delayed payments during the year under
the provisions of the Act.
c) Interest due on principal amounts paid beyond the due date during
the year but without the interest amounts under the act.
d) Interest accrued but not due.
e) Total interest due but not paid.
It may be noted that the company generally makes payment to all its
suppliers with in the agreed credit period (less than 45 days) and thus
the management is confident that liability of interest under this Act,
if any, would not be material.
In response to a Auditors observation at point No. 6 of the Annexure
to the Auditors Report, it may be noted that due to inadvertent
omission, the return of deposits of the company for the year ended 31
March, 2010 could not be deposited within the stipulated time period.
However, the same is being deposited with the Registrar of Companies
and Reserve Bank of India.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information required to be furnished in terms of Section 217(1 )(e) of
the Companies Act, 1956 read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 relating
to Conservation of Energy, Technology Absorption & Foreign Exchange
Earnings & outgo is annexed herewith & forms part of this report.
DIRECTORSRESPONSIBILITY STATEMENT
In terms of Sec. 217(2AA) of the Companies Act, 1956, the Directors
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 judgments and estimates that were reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit of
the company for the year under review.
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 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.
PARTICULARS OF EMPLOYEES
During the year there were no employees who were in receipt of
remuneration more than the limit prescribed under Section 217(2A) of
the Companies Act, 1956, read with Companies (Particulars of employees)
Rules, 1975 as amended.
PERSONNEL
The relations with the employees of the Company continued to be
cordial. Your Directors wish to place on record their appreciation for
the excellent work done by the employees at all levels.
ACKNOWLEDGEMENTS
Your Directors express their sincere gratitude and deep appreciation
for the co-operation and assistance given by the financial
institutions, banks, suppliers and customers of the Company during the
year under report and look forward to their continued support. Your
Directors also thankfully acknowledge the trust and confidence reposed
by you in the company.
For and on behalf of the Board of Directors
sd/-
Place: New Delhi Anil Modi
Date: 04.09.2010 Chairman
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