Mar 31, 2023
The Board of Directors of your Company, with extensive gratification is presenting the 40th Annual Report of your Company for the year ended 31st March, 2023.
FINANCIAL HIGHLIGHTS
The financial performance on the basis of Standalone & Consolidated Financial Statements for the year ended 31st March, 2023 is summarized as below:
Standalone (Rs. In Lakhs) |
Consolidated (Rs. In Lakhs) |
|||
Particulars |
Current Financial Year 31.03.2023 |
Previous Financial Year 31.03.2022 |
Current Financial Year 31.03.2023 |
Previous Financial Year 31.03.2022 |
Revenue from Operations |
26345.80 |
16106.44 |
26628.05 |
16314.92 |
Other Income |
2927.63 |
2830.25 |
485.44 |
885.00 |
Total income |
29273.43 |
18936.69 |
27113.49 |
17199.92 |
Total Operating Expenditure |
18685.22 |
11377.92 |
18827.93 |
11580.50 |
Profit/(loss) before Depreciation, Finance costs, Exceptional items and tax expense |
10588.21 |
7558.77 |
8285.56 |
5619.42 |
Less: Depreciation/Amortization/Impairment |
2017.44 |
2340.03 |
2017.49 |
2411.31 |
Profit/(Loss) before Finance cost, Exceptional items and Tax Expense |
8570.77 |
5218.74 |
6268.07 |
3208.11 |
Less: Finance Costs |
1151.47 |
1849.47 |
1169.89 |
1959.04 |
Profit/(loss) before Exceptional items and Tax Expense |
7419.30 |
3369.27 |
5098.18 |
1249.07 |
Add/(less): Exceptional items |
- |
- |
- |
4361.24 |
Profit /(Loss) before Tax Expense and Share of Profit/(Loss) of the Associates |
7419.30 |
3369.27 |
5098.18 |
5610.31 |
Share of Profit/(Loss) of the Associates |
- |
- |
506.55 |
(989.15) |
Profit /(Loss) before Tax Expense |
7419.30 |
3369.27 |
5604.73 |
4621.16 |
Less: Tax Expense - Current & Deferred |
1910.15 |
723.15 |
2095.24 |
1315.88 |
Profit/ (loss) for the year (1) |
5509.15 |
2646.12 |
3509.49 |
3305.28 |
Other Comprehensive Income/(loss)(2) |
(26.34) |
114.53 |
(46.22) |
60.24 |
Total (1 2) |
5482.81 |
2760.65 |
3463.27 |
3365.52 |
The annexed Management Discussion and Analysis Report forms part of this report and covers, amongst other matters, the performance of the Company during the Financial Year 2022-23 as well as the future outlook.
During the year under review, the Board of Directors of the Company have decided to recommend and declare, subject to the approval of the shareholders, the dividend on 10% fully paid-up Cumulative Redeemable Preference Shares of the Company of Rs. 100/- each and the same shall be paid to all the preference shareholders whose names appear in the Register of Members as on the record date i.e. 20th day of October, 2023.
During the year under review, the Board of Directors have decided to distribute dividend on 10% Cumulative Redeemable Preference Shares of the Company and then to partly redeem the same from the net profit of the Company instead of transferring it to the reserves.
As on the financial year ended 31st March, 2023, the:
The authorized share capital of the Company is Rs. 40,00,00,000/- divided into 3,00,00,000 (Three Crores) Equity Shares of Rs.10/- each and 10,00,000 (Ten Lakhs) Preference shares of Rs. 100/- each.
The Paid-up equity share capital of the Company is Rs. 27,51,80,000 comprising of 1,75,18,000 Equity shares of 10/- each and 10,00,000 Preference shares of Rs. 100/- each.
During the year under review, the Company has not issued shares with differential voting right neither granted stock option nor sweat equity. Further the Company not issued any debenture bonds and any nonconvertible securities.
The Companyâs equity shares are listed with the Bombay Stock Exchange Limited.
REDEMPTION OF 10% CUMULATIVE REDEEMABLE PREFERENCE SHARES
The Board of Directors of the company had approved the redemption of its 10% fully paid-up Cumulative Redeemable Preference Shares of Rs. 100/- each pursuant to the provisions of Section 55 of the Companies Act, 2013 read with Rule 9 of the Companies (Share Capital and Debentures) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force).
During the year, your Company did not accept any public deposits as provided under Chapter V of the Companies Act, 2013 (âActâ) read with the rules made thereunder as such and no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet.
During the year under review the Company has not received any amount as loan from director of the Company.
REVISION IN FINANCIAL STATEMENTS OR BOARDSâ REPORT UNDER SECTION 131 (1) OF THE COMPANIES ACT, 2013
In terms of Section 131 of the Act, the Financial Statements and Boardâs Report are in compliance with the provisions of Section 129 or Section 134 of the Act and that no revision has been made during any of the three preceding financial years.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Provisions of Section 186 of the Act for loans given, investments made or guarantees or security provided is not applicable on your Company, being in exempt list for providing infrastructural facilities in terms of Schedule VI of the Act.
M/s Sayaji Hotels Management Limited (âSHMLâ), a Wholly Owned Subsidiary of the Company, has signed and entered into 13 (Thirteen) Management Agreement for the expansion of its Brand by having new properties in Amravati, Pithampur, Sanwer road Indore, Aurangabad, Gwalior, Harda, Hoshangabad, Lonavala, Rewa, Sangli, Sasan Gir, Satara, Tadoba.
This expansion plan will lead to an addition of around 650 new rooms and an overall increase of 1000 rooms into the portfolio by the fiscal 2022-23. It aims at strengthening and increasing presence on PAN India basis.
COMPOSITE SCHEME OF AMALGAMATION AND ARRANGEMENT
The Composite Scheme of Amalgamation and Arrangement (âthe Schemeâ) provides for:
i. The amalgamation of Ahilya Hotels Limited (Transferor Company 1) into Sayaji Hotels Limited on a going concern basis and reduction and cancellation of Share Capital of Sayaji Hotels Limited in the manner set out in the Scheme.
ii. Demerger, transfer and vesting of the Demerged Undertakings from Sayaji Hotels Limited to Sayaji Hotels (Indore) Limited [Formerly known as Sayaji Hotels (Vadodara) Limited)] (Resulting Company 1) and Sayaji Hotels (Pune) Limited (Resulting Company 2) collectively referred to as Resulting Companies and reduction of share capital thereof.
iii. The amalgamation of Sayaji Hotels Management Limited (Transferor Company 2) into Sayaji Hotels Limited on a going concern basis.
The Hon''ble National Company Law Tribunal, Chennai Bench ("NCLT") vide its order dated 11th July, 2023 has sanctioned the scheme and the same was filed with the Registrar of Companies on 1st August, 2023 (âEffective dateâ).
Pursuant to the Scheme, the Transferor Company 1 & 2 is dissolved without winding up and the Resulting Company 1 & 2 stands demerged from Sayaji Hotels Limited. The shares of the Resulting Company 1 & 2 are going to be listed on the Designated Stock Exchange. As consideration of the Amalgamation, the Company has allotted 24,54,977 (Twenty-Four Lakh Fifty-Four Thousand Nine Hundred Seventy-Seven only) Equity Shares of Rs. 10/- each to the shareholders of Transferor Company 1, as on record date i.e. 28th July, 2023 and the cross holding of the Company has been cancelled.
The Company had also obtained the listing approval as well as trading approval vide BSE intimation letter dated 9th August, 2023 and 23rd August, 2023 respectively. Since Transferor Company 2 was a wholly owned subsidiary of the Company, there were no issue of shares as consideration for the amalgamation of Transferor Company 2 with the Company in terms of the Scheme.
The Resulting Company 1 and 2 had allotted 30,46,605 (Thirty Lakhs Forty-Six Thousand Six Hundred Five) equity shares and 8 (Eight) preference shares each to the shareholders of Sayaji Hotels Limited as per the approved scheme as on record date i.e. 5th September, 2023 and filed the application to BSE Limited for obtaining approval for listing of its securities at the stock exchange. As on the date of this report, the approval from stock exchange for admission of its securities is awaited.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
The Company has a policy and framework for employees to report sexual harassment cases at workplace and our process ensures complete anonymity and confidentiality of information. The said policy can be accessible through https://savaiihotels.com/images/pdf/policies/policv-on-sexual-harassment.pdf
The Company has zero tolerance towards sexual harassment at the workplace and towards this end, has adopted a policy in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. All employees (permanent, contractual, temporary, trainees) are covered under the said policy. Internal Complaints Committees has also been set up to redress complaints received on sexual harassment.
During the year under review, the Company has not received any complaint of sexual harassment from the women employees of the Company and no complaint was pending at the end of the year.
SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
As on 31st March, 2023, your Company has 4 (four) wholly owned Subsidiaries and 1(One) Associate Company which are here as under:
Wholly Owned Subsidiary Companies |
Associate Company |
Sayaji Hotels Management Limited Sayaji Hotels (Pune) Limited Sayaji Hotels (Indore) Limited* Sayaji Housekeeping Services Limited |
Barbeque Nations Hospitality Limited |
* Formerly Known as Sayaji Hotels (Vadodara) Limited |
During the year under review, Intellistay Hotels Private Limited ceased to be the Associate Company as the entire amount of investment of Sayaji Hotels Management Limited has been written-off against loss on impairment of investment.
In accordance with Section 129(3) of the Act read with Rule 8(1) of Companies (Accounts) Rules, 2014, the consolidated financial statements of the Company and all its subsidiaries and associates have been prepared by the Company and a separate statement containing the salient features of the financial statement of its subsidiaries and associate company in form AOC-1 is attached as âAnnexure-1â to this Annual Report.
In terms of provisions of Section 136 of the Act, separate audited accounts of the subsidiary companies shall be available on Companyâs website https://savaiihotels.com/investors/. The Company will make available physical copies of these documents upon request by any shareholder of the Company interested in obtaining the same and are available for inspection by any Member of the Company at the Registered Office of the Company.
CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES
The Board of Directors formulated a Corporate Social Responsibility (CSR) Policy for your Company pursuant to the provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), on the recommendations of the CSR Committee. The policy encompasses the Companyâs philosophy for delineating its responsibility as a corporate citizen and lays down the guidelines and mechanism for undertaking socially useful programs for welfare & sustainable development of the community at large. CSR Policy is placed on the Companyâs website at https://sayaiihotels.com/images/pdf/policies/Corporate Social Responsibility Policy.pdf and as the average net profit of the Company for last 3 years does not fall under the defined limits of the Act, hence there is no liability on the Company to incur expenditure on CSR activities as prescribed u/s 135 and Schedule VII of the Companies Act, 2013 hence is not required to provide particulars of CSR during the Financial Year 2022-23.
PROHIBITION OF INSIDER TRADING
The Company had in place a mechanism to avoid Insider Trading and abusive self-dealing in the securities of the Company by the Directors of the Company and other designated persons.
For the above mentioned purpose, the Company has established systems and procedures to prohibit insider trading activity and has framed a Code of Conduct to Regulate, Monitor and Report trading by insiders and Code of Fair Practices and Procedures for disclosure of Unpublished Price Sensitive Information (UPSI) (âCode of Conductâ) as per the requirements of SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations), which prohibits the Directors of the Company and other designated persons to deal in the securities of the Company on the basis of any UPSI, available to them by virtue of their position in the Company. The objective of this Code of Conduct is to prevent misuse of any UPSI and prohibit any insider trading activity, in order to protect the interest of the shareholders at large.
A report on compliance of Minimum Standards for Code of Conduct and details of violation are placed before the Board on annual basis.
The Code of conduct are available on the website of the Company at
https://sayaiihotels.com/images/pdf/Annexure_1_Code_of_Conduct.pdf,https://sayaiihotels.com/images
/pdf/Annexure_2_Code_of_Fair_Disclosure.pdf
BOARD OF DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL
As at 31st March, 2023, the composition of the Board of Directors was in accordance with the provisions of Section 149 of the Act and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with an optimum combination of Executive, Non-Executive and Independent Directors.
As on the date of this Annual Report, the Board of Directors of the Company consists of 6 members. T he Board consists of Managing Director, Whole time Director and 4 Independent Directors and Key Managerial personnel as under:
Sr. No. |
Name |
Designation |
1. |
Mr. Thottappully Narayanan Unni |
Independent Director, Chairman |
2. |
Mr. Raoof Razak Dhanani |
Managing Director |
3. |
Mrs. Suchitra Dhanani |
Whole Time Director |
4. |
Mrs. Isha Garg |
Independent Director |
5. |
Mr. Saquib Salim Agboatwala |
Independent Director |
6. |
Mr. Abhay Chintaman Chaudhari |
Independent Director |
7. |
Mr. Sandesh Khandelwal |
Chief Financial Officer |
8. |
Mr. Ankur Bindal |
Company Secretary and Compliance Officer |
CHANGES IN THE COMPOSITION OF BOARD OF DIRECTORS
During the year under review, no changes were made in the Composition of Board of Directors. STATEMENT ON DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to the provisions of Section 149 of the Act, all the Independent Directors have submitted declarations that each of them meets the criteria of independence as provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
In terms of Regulation 25(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, they have confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. Also pursuant to Rule 6(3) of Companies (Appointment and Qualification of Directors) Rules, 2014. they declared that the provisions of Sub-Rule (1) and Sub-Rule (2) of Rule 6 of the said rules has been complied with.
The Board of Directors, after considering due assessment of the veracity of the declaration submitted by the Independent Directors under sub section (6) of Section 149 of the Act read with sub-regulation (9) of Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements), was of the opinion that all the Independent Directors meet the criteria of independence and have adequate expertise, integrity, proficiency and experience for discharging their duties.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTOR
Your Company believes that a Board which is well familiarized with the Company and its affairs, can contribute significantly to effectively discharge its role of trusteeship in a manner that fulfils stakeholdersâ aspirations and societal expectations. In pursuit of this, the Directors of the Company are updated on changes/developments in the domestic/global corporate and industry scenario including those pertaining to statutes/legislations & economic environment and on matters significantly affecting the Company, to understand their roles and responsibilities, nature of the industry in which the Company operates, business model of the Company which enable them to take well informed and timely decisions.
All Independent Directors are taken through a detailed induction and familiarization programme when they join the Board of your Company and are provided with induction kits which, inter alia, include the Companyâs Memorandum and Articles of Association, Code of Conduct of Board of Directors, Code of Conduct for Prevention of Insider Trading and other relevant documents. Updates on relevant statutory changes are briefed? to the Directors at their meeting.
Apart from the above, the Directors are also given an update on the environmental and social impact of the business, corporate governance, regulatory developments and investor relations matters.
Further, during the year, presentations were also made from time to time at the Board and its committee meetings, on regular intervals, covering the business and financial performance of the Company, business outlook and budget, expansion plans, succession plans etc. The details of familiarization programme attended by Independent Directors is available on the website at https://savaiihotels.com/images/pdf/policies/Familiarization programme for Independent directorspdf. pdf
SEPARATE MEETING OF INDEPENDENT DIRECTORS AND PERFORMANCE EVALUATION OF BOARD BY THEM
During the year under review, a separate meeting of Independent Directors was held on 14th February, 2023 without the presence of non-independent directors and members of the management pursuant to Schedule V of the Act and Regulation 25(3) and (4) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, details of which is present in the Corporate Governance Report forming part of this Annual Report.
Mrs. Suchitra Dhanani, Whole time Director will retire by rotation at the ensuing Annual General Meeting (âAGMâ) of your Company and being eligible, offers herself for re-appointment in accordance with the provisions of Section 152 (6) of the Act read with Articles of Association of the Company.
The disclosure pertaining to the director being re-appointed as required pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standards - 2 is given in the explanatory statement to the Notice convening the AGM, forming part of this Annual Report.
MEETINGS OF THE BOARD AND ITS EFFECTIVENESS
During the financial year under review, your Board has met Eight (8) times and details of the composition of the Board and its Committees and of the meetings held and attendance of the Directors at such meetings are provided in the Corporate Governance Report.
Further, the Company for effectiveness of Board process has adopted the Governance Guidelines which inter alia, cover aspects related to composition and role of the Board, Chairman and Directors, Board diversity, definition of independence, Directorâs term, retirement age and Committees of the Board. It also covers aspects relating to nomination, appointment, induction and development of Directors, Directorâs remuneration, Code of Conduct, Board Effectiveness Review and mandates of Board Committees
COMMITEES OF THE BOARD OF DIRECTORS
During the year under review, the Company has 5 (five) Committees as mentioned below and details with respect to the composition, charters and meeting held are given in detail in the Corporate Governance Report forming part of this Annual Report:
⢠Audit Committee
⢠Borrowing and Investment Committee
⢠Nomination and Remuneration Committee
⢠Stakeholdersâ Relationship Committee
⢠Scheme Implementation Committee
The details of Composition of the above-mentioned Committees are also available on the Companyâs website https://savaiihotcls.com/imagcs/pdf/composition-variolls-committccs/Composition of Committee Meetings.pdf
POLICY ON DIRECTORâS APPOINTMENT AND REMUNERATION
In accordance with Section 178 of the Act with Rule 6 of Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has constituted a Nomination and Remuneration Committee (âNRCâ), details of which has been disclosed in the Corporate Governance Report forming part of this Annual Report and your Company has also formulated a Nomination and Remuneration Policy (âNRC Policyâ) in accordance with Section 178(3) of the Companies Act, 2013 for appointment and remuneration of Directors, Key Managerial Personnel (KMP) and senior management personnel, salient features of which are hereunder:
⢠NRC shall identify potential candidates who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down in the NRC Policy and to recommend the Board for their appointment and removal;
⢠NRC shall formulate the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a NRC Policy, relating to the remuneration for the directors, key managerial personnel and other senior management person;
⢠NRC shall carry out an annual evaluation process of the Board performance and its Committees;
⢠NRC Policy contains provisions regarding retirement and the Board shall have the discretion in retain the Director, KMP, Senior Management Personnel in the same position/remuneration or otherwise even after attaining the retirement age, upon the recommendation of the NRC for the benefit of the Company;
⢠NRC policy ensures that the level and composition of remuneration is reasonable and sufficient to attract, retain, motivate and promote talent to run the Company successfully and ensures long term sustainability of talented managerial persons and create competitive advantage;
⢠NRC policy ensures relationship of remuneration to performance is clear and shall directly linked to their effort, performance, dedication and achievement relating to the Companyâs operations;
⢠NRC shall recommend remuneration for KMP (except WTD/MD) and Senior Management Personnel on the basis of the role and position of the individual employee, including professional experience, responsibility, job complexity and market conditions.
As per Section 134(3) and 178(4) of the Act, the web link of Nomination and Remuneration Policy of the Company is https://savajihotels.com/images/pdf/policies/Nomination_and_Remuneration_Policv.pdf
AFFIRMATION ON COMPLIANCE WITH CODE OF CONDUCT OF THE COMPANY
Pursuant to Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has adopted a Code of Conduct for its employees including the Managing Director and Executive Directors and Senior Management. In addition, the Company has also adopted a Code of Conduct for its Non-Executive Directors and Independent Directors. These Codes are available on the Company''s website at https://sayajihotels.com/images/pdf/code-of-
conduct/Code_of_Conduct_for_Board_and_Senior_Management_2.pdf
All Directors and members of Senior Management have as on 31st March 2023, affirmed their compliance with:
⢠Code of Conduct for Board of Directors and Senior Management
⢠Code for Independent Directors, as applicable.
The Company has obtained a Certificate from the Managing Director regarding compliances of the codes as stipulated above. The Certificate is appended as âAnnexure - 2â to this Annual Report.
ANNUAL EVALUATION OF THE BOARD
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors of your Company has carried out a formal annual evaluation of the performance of the Board as a whole, its Committees and of individual directors through a structured questionnaire, prepared after taking into consideration the guidance note issued by SEBI and ICSI on Board evaluation, covering various aspects of the Boardâs functioning, Committee effectiveness, directorâs efficiency on individual basis etc.
The Company has an effective system in place for identification of elements of risk which are associated with the accomplishment of objectives, operations, development, revenue and regulations in relation to the Company and appropriate measures are taken, wherever required, to mitigate such risks beforehand.
The Company has specifically identified following risks and also preparing mitigation plans for each risk identified:
⢠Risk of business slowdown, inadequate growth and negative returns;
⢠Risk related to cyber security;
⢠Risk of deterioration of financial health and business interruption;
⢠Risk of inadequate compliance;
⢠Risk of Guest and Staff behavior; and
⢠Risk of impact on reputation and fraud.
Along with this Statutory as well as Internal Auditors report to the Audit Committee during their audit and highlight risks, if any, associated with organization and also suggest the appropriate measures, in consultation with the management and the Audit Committee, which can be taken by the Company in this regard. The Statutory Auditors also report to the Audit Committee of any instance of non-adherence to the procedures and manual which may increase the risk of frauds in the organization.
The Company has in place Risk Management Policy formulated in accordance with the provisions of Section 134(3)(n) of the Act, which is available at
https://savajihotels.com/images/pdf/policies/Risk_Management_Policv.pdf. There has been no change in the policy during the year under review.
MATERIAL DEVELOPMENTS IN HUMAN RESOURCE AND REMUNERATION OF EMPLOYEES
Your Company firmly believes that a well-planned HRM program that is tailored to your organization and staff can actually improve your businessâs bottom line.
Our teams are integral to our business. We have embraced a culture of excellence and meritocracy to nurture our people. We believe in selecting the right talent, training them and instilling in them the spirit of Sayajiians. We focus on developing the most superior workforce so that the organization and individual employees can accomplish their work goals in service to customers. We aim also at achieving advance flexibility, innovation, competitive advantage and improved business performance.
Sayaji follows a performance measuring tool like Balance Score Card (BSC) and Key Performance Indicators (KPI), applicable depending on their position in the organization, by which periodical
evaluation of the employeesâ performance is done based on their area of working. This also encourage them to work hard and efficiently at all levels of work.
The Company has total number of permanent employees on roll as at 31st March, 2023 was 1433 across all its hotel units.
The information required under section 197(12) of the Act, read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is furnished in the â Annexure -3â to this Annual report.
Further, none of the employee in the Company falls under the provision of Section 197 (12) of the Companies Act, 2013 and Rule 5 (2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
ADEQUACY OF INTERNAL FINANCIAL CONTROL SYSTEMS
The Company has established an adequate system of internal controls, with documented procedures covering all corporate functions and hotel operating units. Internal controls provide:
⢠reasonable assurance regarding the effectiveness and efficiency of operations;
⢠the adequacy of safeguards for assets;
⢠assurance regarding reliability of financial statements;
⢠the reliability of financial controls and compliance with applicable laws and regulations.
The internal audit process provides a positive assurance to the Company about the internal financial control, it converges process framework, risk and control matrix and a scoring matrix, covering all critical and important functions inter-alia revenue management, hotel operations, purchase, finance, human resources and safety. It ensures that all the transactions are authorized, recorded and reported correctly and assets are safeguarded and protected against loss from unauthorized use or disposition.
Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the Internal, Statutory and Secretarial Auditors and external consultants and the reviews performed by management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companyâs internal financial controls were adequate and effective during Financial Year 2022-23.
The Company has adopted various policies under the Companies Act, 2013, SEBI (Prohibition of Insider Trading) Regulations, 2015, SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable laws, which are given here below:
⢠Corporate Social Responsibility Policy
⢠Familiarization Programme for Independent directors
⢠Material Subsidiary Policy
⢠Related Party Transaction Policy
⢠Nomination and Remuneration Policy
⢠Policy for determination of materiality
⢠Policy for Preservation of the Documents and Archival of Documents
⢠Business Responsibility Policy
⢠Policy for Procedure of Inquiry in Case of Leak of Unpublished Price Sensitive Information (âUPSIâ)
⢠Whistle Blower & Vigil Mechanism Policy
⢠Policy on Sexual Harassment
All the policies are amended as required from time to time and are available at the Companyâs website under Investorâs head which can be accessed through link: https://savaiihotel s.com/investors/.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act, the Directors of your Company, to the best of their knowledge and ability and based upon representations from the Management, hereby confirm that:
⢠in the preparation of the annual financial statements for the year ended 31st March, 2023, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
⢠they have selected such accounting policies in consultation with Statutory Auditors and applied them consistently and made iudgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs and loss of the company at the end of the Financial Year 2022-23;
⢠they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
⢠they have prepared annual financial statements for year ended 31st March, 2023 on a going concern basis;
⢠they have laid down internal financial controls for your Company, which are adequate and operating effectively; and
⢠they have been devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
A statement to the effect is annexed here to as âAnnexure-4â forming part of this Annual Report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All the contracts, arrangements or transactions entered into during the year under review by the Company with related parties were in ordinary course of business and on an armâs length basis. Prior omnibus approval is obtained for related party transactions (RPTâs) which are of a repetitive nature and entered in the Ordinary Course of Business and are at Armâs Length. A statement on RPTs specifying the details of the transactions, pursuant to each omnibus approval granted, has been placed on quarterly basis for review by the Audit Committee.
Since all the Related Party Transactions that were entered into during the financial year were on armâs length basis and in ordinary course of business. Therefore, the provisions of Section 188 of the Act are not applicable. Thus, the disclosure in Form AOC-2 is not required. Further, there are no materially significant Related Party Transactions during the year under review made by the Company with its Promoters, Directors, Key Managerial Personnel or other designated persons, which may have a potent ial conflict with the interest of the Company at large.
As per the requirements of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has framed a policy on dealing with RPTs which can be accessed on the Companyâs website under the link: https://sayaiihotels.com/images/pdf/Annexure 4 RPT Policy.pdf This Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions with the Related Parties.
M/s K.L. Vyas & Co., Chartered Accountants were re-appointed as Statutory Auditors of your Company at the 35th Annual General Meeting held on 28th September, 2018, for a term of five consecutive years till the financial year 2022-23. They have completed 10 years as Statutory Auditors of the Company. The provisions regarding rotation of auditors, as prescribed under the Act, are applicable to the Company. Hence, it is proposed to appoint M/s Manish Joshi and Associates, Chartered Accountants (Firm Registration No.: 011631C) as Statutory Auditors of the Company for a period of 5 consecutive years commencing from this Annual General Meeting till the Annual General Meeting of the Company to be held in 2028 to the members for their approval.
The Report given by the Auditors on the financial statements of the Company is part of this Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their report. During the year under review, the Auditors had not reported any matter under Section 143 (12) of the Companies Act, 2013.
The Board of Directors had appointed M/s Neelesh Gupta & Co., Practicing Company Secretaries (COP No. 6846) in accordance with provisions of Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to conduct Secretarial Audit and Annual Secretarial Compliance Report for the financial year 2022-23 whose report is attached separately to this report as âAnnexure 5â of this Report.
The Company has undertaken an audit for the year ended 31st March, 2023, pursuant to Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for all applicable compliances as per the said Regulations. The Annual Secretarial Compliance Report duly signed by Mr. Neelesh Gupta, Practising Company Secretary is available on the website of the Company at https://sayaiihotel s.com/inve stors/.
The Company is not required to maintain cost records and conduct cost audit in accordance with Section 148(1) of the Act read with Rule 3 of the Companies (Cost Record and Audit) Rules, 2014 as the services of the Company are not covered under the said rules and limits.
Your Company has been practicing the principles of good corporate governance and is committed to maintain high standards of the corporate ethics and professionalism. The tenets of inclusiveness and transparency are integral part of our corporate governance practices.
In compliance with the provisions of Regulations 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a report on Corporate Governance is available as a separate section in this Annual Report.
A certificate pursuant to Para E Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, from M/s K. L Vyas and Company, Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached as âAnnexure - 6â to this Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy, as part of vigil mechanism and has revised the Whistle Blower policy in the meeting of Board in confirmation with Section 177(9) of the Act and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, to provide Directors and employees an avenue to lodge Complaints, in line with the commitment of Company to the highest possible standards of ethical, moral and legal business conduct and its commitment to open communication and to provide necessary safeguards for protection of employees from reprisals or victimization, for whistle-blowing in good faith.
The purpose of this policy is to provide a framework to protect employees wishing to raise a concern about serious irregularities within the Company. It is affirmed that no personnel of the Company have been denied to access to the Chairman of Audit Committee.
The details of the policy have been disclosed in the Corporate Governance Report, which forms a part of the Annual Report and is also available on https://sayajihotels.com/images/pdf/whistle-blower-vigil-mechanism/Whistle_Blower Vigil_Mechanism_Policy.pdf
MANAGEMENT DISCUSSION & ANALYSIS
Pursuant to the provisions of Regulation 34(2)(e) read with Para B Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Managementâs Discussion and Analysis Report on Companyâs performance - industry trends and other material changes with respect to the Company and its subsidiaries, wherever applicable, forms part of this Annual Report.
In terms of Regulation 17(8) read with Part B of Schedule II of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Managing Director and Chief Financial Officer of the Company have issued a certificate authenticating Financial Statements for the Financial Year 2022-23 which provides a true and fair view of the affairs of the Company and the said certificate dated 29th May, 2023 was placed before the Board in its meeting held on 29th May, 2023 and was reviewed and taken on record by the Board. The said Certificate is attached as âAnnexure - 7â to this Annual Report. Since thereâs no CEO in the Company, therefore certificate is taken from MD and CFO of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Section 129(3) of the Companies Act, 2013, requires preparation of consolidated financial statements of the Company and of all the subsidiaries including associate company and joint venture businesses in the same form and manner as that of its own. In conformity with the above section and Indian Accounting Standards (''''Ind AS'''') notified under the Companies (Indian Accounting Standards) Rules, 2015 the Company has prepared Consolidated Financial Statements which are forming part of this Annual Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGOES
Your Company is continuously striving towards conservation of energy across all its units and has also earned foreign currency in Financial Year 2022-23, complete details with regard to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and outgo in accordance with the provisions of Section 134 (3)(m) of the Companies Act 2013 read with Rule 8(3) of Companies (Accounts) Rules, 2014 has been disclosed in âAnnexure 8â to this Annual Report.
COMPLIANCE WITH SECRETARIAL STANDARDS
During the year under review, the Company has complied with Secretarial Standards on Board meeting and General meeting, as applicable on the Company, issued by Institute of Company Secretaries of India.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF FINANCIAL YEAR AND DATE OF REPORT
There have been no material changes and commitments, affecting the financial position of the Company which occurred between the end of the financial year 2022-23 to which the financial statements relate and the date of this report except the approval of scheme of amalgamation and demerger as specified above in this report and approved by Honâble NCLT, Chennai Bench. Pursuant to the Scheme, the entire Indore business of the Company will be segregated and be run by the Sayaji Hotels (Indore) Limited (âResulting Company 1â) and entire Baroda and Pune Business of the Company will now be run by Sayaji Hotels (Pune) Limited (âResulting Company 2).
DEMATERIALIZATION OF SHARES AND LIQUIDITY
The Companyâs shares are compulsorily traded in dematerialized form on BSE. The Company have connectivity with the depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), as prescribed by the Securities and Exchange Board of India. Equity shares of the Company representing 91.76% of the Companyâs equity share capital are dematerialized as on 31st March, 2023. Under the Depository System, the International Securities Identification Number (ISIN) allotted to the Companyâs shares is INE318C01014.
Further your Company has also availed the demat facility for the Preference Shareholders from NSDL and 75% of Preference Shares are held in dematerialized form.
PAYMENT OF LISTING FEE AND CUSTODIAL FEE
Your Company has paid both Annual Listing Fee and Annual Custodial Fee for the Financial Year 202324 to the BSE Limited and to the depositoryâs i.e. National Securities and Depositories Limited (NSDL) and Central Depository Services (India) Limited (CDSL) respectively.
CERTIFICATE FROM PRACTISING COMPANY SECRETARY OF NONDISQUALIFICATION OF DIRECTORS
The Company has obtained a certificate dated 14th September, 2023 from M/s Neelesh Gupta & Co., Practicing Company Secretaries, under Regulation 34(3) and Schedule V Para C Clause (10) (i) of LODR Regulations, 2015 confirming that none of the Directors on the Board of the Company have been debarred or disqualified from being appointed or continuing as Directors of Company by the Securities and Exchange Board of India (SEBI) and Ministry of Corporate Affairs (MCA) or any such statutory authority and the same is annexed hereto as âAnnexure - 9â.
Pursuant to Section 92(3) and Section 134 (3) (a), web address of the annual return as on 31st March, 2023 in form MGT-7 is https://sayaiihotels.com/images/Form MGT 7 SHL 2022-23 website.pdf
ACKNOWLEDGEMENT AND APPRECIATION
Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain a fighter during this unfavorable time.
The Board places on record its appreciation for the support and co-operation your Company has been receiving from its suppliers, distributors, retailers, vendors and others associates. Your Company looks upon them as partners in its progress, it will be your Companyâs endeavor to build and nurture strong links with them based on mutuality of benefits, respect for and co-operation with each other, consistent with consumer interests.
Your Directors also take this opportunity to thank all Shareholders, Clients, Vendors, Banks, Government and Regulatory Authorities and Stock Exchanges for their continued support.
For and on behalf of the BoardPlace: Indore Th ottap pully Narayanan Un n i
Date: 4th October, 2023 Chairman
DIN: 00079237
Mar 31, 2018
To,
THE MEMBERS OF SAYAJI HOTELS LIMITED
The Directors have pleasure in presenting their 35th Annual Report of your Company together with its Audited consolidated and standalone Financial Statements for the financial year ended March 31, 2018.
Pursuant to the notification dated February 16, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards (ââInd ASââ) notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2017. As such financial statements for the previous year ended as at March 31, 2017 have been restated to make comparable to Ind AS.
HIGHLIGHTS OF PERFORMANCE
During the year under review, on standalone basis the total revenue in the year 2018 was increased by 21.85 % (from Rs.15917.79 Lakhs in 2017 to Rs.19396.85 Lakhs in 2018). This was mainly due to opening of the new hotel unit and good performance of the existing hotels. The Losses After Tax is also decreased by 41% (from Rs. 614.75 Lakhs to Rs. 362.48 Lakhs). On consolidated level the total revenue was increased by 21.18% (from Rs. 18045.67 Lakhs to Rs. 21869.25 Lakhs). The loss after tax is also decreased by 71.36 % (from. Rs. 900.02 Lakhs to Rs. 257.78 Lakhs).
FINANCIAL RESULTS (Rs. In Lakhs, Except EPS)
Standalone (Rs. in Lakhs) |
Consolidated (Rs. In Lakhs) |
|||
Particulars |
Year ended March 31, 2018 |
Year ended March 31, 2017 |
Year ended March 31, 2018 |
Year ended March 31, 2017 |
Total income from operation(net) |
19396.85 |
15917.79 |
21869.25 |
18045.67 |
Net Profit / (Loss) for the period (before Tax, Exceptional and/or Extraordinary items) |
(283.75) |
(719.14) |
(257.78) |
(900.02) |
Share of Profit / (Loss) of associate |
- |
- |
193.94 |
549.15 |
Net Profit / (Loss) for the period before tax (after Exceptional and/or Extraordinary items) |
(283.75) |
(719.14) |
(63.84) |
(350.87) |
Net Profit / (Loss) for the period after tax (after Exceptional and/or Extraordinary items) |
(362.85) |
(614.36) |
(389.13) |
(305.79) |
Total Comprehensive Income for the period [Comprising Profit / (Loss) for the period (after tax) and Other Comprehensive Income (after tax)] |
(362.48) |
(614.75) |
(365.36) |
(299.75) |
Equity Share Capital |
1751.80 |
1751.80 |
1751.80 |
1751.80 |
Earnings Per Share |
||||
Basic: |
(2.76) |
(4.19) |
(2.91) |
(2.43) |
Diluted: |
(2.76) |
(4.19) |
(2.91) |
(2.43) |
DIVIDEND
In view of the accumulated losses as well as the Company is in the process to expand its reach in the various part of the Country through owned hotel, management model, operating lease etc. and said expansion may demand substantial working capital infusion, hence the board has not recommended dividend for the financial year 2017-18 (Previous year 2016-17 Nil).
REGISTERED OFFICE SHIFTING
The Registered office of the Company is shifting from the State of Gujarat to the State of Tamilnadu (within the jurisdiction of the Registrar of Companies, Chennai) vide the order dated June 29th, 2018 of the Regional Director (North - Western Region), Ahmedabad.
SHARE CAPITAL
The authorized share capital of the Company is Rs. 4000.00 Lakhs. The paid up Equity Share Capital is Rs.1751.80Lakhs and Preference Share Capital is Rs. 1000.00 Lakhs.During the year under review, the Company has not issued shares with differential voting right nor granted stock option not sweat equity.
The Companyâs equity shares are listed with the BSE Ltd. and available for trading at the platform of BSE Ltd.
FINANCE
Cash and cash equivalent as at 31st March, 2018 was Rs. 1214.95 Lakhs. The Company continues to focus on judicious management of its working capital, receivables, and inventories. The working capital parameters were kept under strict check through continuous monitoring.
DEPOSITS
In terms of the provisions of Sections 73 and 74 of the Companies Act, 2013 read with Companies (Acceptance of Deposits by Companies) Rules, 2014, the Company had no opening or closing balances and during the year under review, the Company has also not accepted any public deposits and as such, no amount of principal or interest was outstanding as on March 31, 2018.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The Company has disclosed the full particulars of the loans given, investments made or guarantees or security provided as required under section 186 of the Companies Act, 2013 and Regulation 34(3) and Schedule V of the SEBI (LODR) Regulations, 2015 in Notes to the financial statements attached with this Board Report. However, the Company is covered under the infrastructure section therefore section 186 of the Companies Act, 2013 is not applicable as such.
AMOUNT TO BE CARRIED TO RESERVE
During the year under review Rs. (1007.21 Lakhs)are proposed to be carried in the financial statements under the head of the reserves and surplus.(Previous year Rs. (644.36 Lakhs)
BUSINESS PLANS - Vadodara
During the year the Company has launched one more 4 Star hotel in the Vadodara City under the âSayajiâ brand. The Hotel has 137 rooms, 2 restaurants and multiple banquet facilities. The hotel received fair response from the city and surrounding area. The current year will be its first full fledge year of operation.
The existing hotel at Vadodara city was re-branded in the name of âEffotelâ. At present that hotel is in the process of the complete renovation and may re-open by September 2018.
- Raipur
Last year the Company started operation into the Raipur City. The hotel property is receiving good response and ramping up.
- Management Contract/Lease Model
The Company is focusing to open more and more hotel into the tier 2 cities under the management contract/lease model. This strategy will help the Company in two ways, firstly the brand of the Company will easily expand and secondly there will be huge saving on account of capital expenditure and incidental finance cost.
PERFORMANCE OF THE SUBSIDIARY COMPANIES - AUDITED FINANCIAL STATEMENTS OF THE COMPANYâS SUBSIDIARIES
As on 31st March 2018 the Company has 3 Subsidiaries and 1 Associate Company. During the year under review, there was no change in the nature of businesses of Subsidiaries.
Pursuant to the provisions of Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Companyâs subsidiaries and Associates. A statement containing salient features of the financial statements of the subsidiary/associate companies is also included in the Annual Report as attached in Annexure - 6.
Pursuant to the provisions of Section 136(1) of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of the subsidiaries are available on the website of the Company, www.sayajihotels.com.
Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary at the Companyâs Registered Office or e-mail to [email protected].
BOARD OF DIRECTORSAND OTHER KEY MANAGERIAL PERSONNEL
The Board of Directors has an optimum combination of executive and non-executive independent directors including one women director.According to the requirement of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015. As on 31st March, 2018, your Board has following directors and key managerial personals:
S.No. |
Name |
Date of Appointment |
Designation |
1. |
Mr. Thottapuly Narayanan Unni |
31/01/2002 |
Independent Director |
2. |
Mr. Sanjay Ahuja |
01/02/2012 |
Nominee Director (of TFCI) |
3. |
Mr. Raoof Razak Dhanani |
14/11/2013 |
Managing Director |
4. |
Mrs. Suchitra Dhanani |
06/02/2014 |
Whole Time Director |
5. |
Mr. Abhay Chintaman Chaudhari |
14/02/2017 |
Independent Director |
6. |
Mr. Kayum Dhanani |
30/11/2012 |
Director |
7. |
Mr. Pradeep Goyal |
06/02/2014 |
Independent Director |
8. |
Mr. Sandesh Khandelwal |
06/02/2014 |
Chief Financial officer |
9. |
Mr. Amit Sarraf |
26/09/2011 |
Company Secretary |
CHANGES IN THE COMPOSITION OF BOARD OF DIRECTORS
During the year under review, there were no changes done in the constitution of the Board.
INDEPENDENT DIRECTORS
As on March 31st, 2018, Your Company has following Independent Directors:
S.No |
Name |
DIN |
Date of Appointment |
1. |
Mr. T.N. Unni |
00079237 |
31/01/2002 |
2. |
Mr. Pradeep Goyal |
02798770 |
06/02/2014 |
3. |
Abhay Chintaman Chaudhari |
06726836 |
14/02/2017 |
The Company has received Declarations of Independence as stipulated under Section 149(7) of the Companies Act, 2013 from Independent Directors confirming that he is not disqualified from appointing/continuing as Independent Director.
RETIREMENT BY ROTATION -
In accordance with the provisions of Section 152(6) of the Companies Act, 2013 and in terms of Articles of Association of the Company, Mr. Raoof Razak Dhanani is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The Board recommends their appointment.
The resolutions seeking approval of the members for the reappointment of Mr. Raoof Razak Dhanani, have been incorporated in the Notice of the Annual General Meeting of the Company.
RE-APPOINTMENT OF THE INDEPENDENT DIRECTORS FOR THE SECOND TERM
The term of 5 years of the existing independent directors Mr. T.N. Unni and Mr. Pradeep Goyal is being completed on 31st March, 2019. The Nomination and Remuneration Committee of the Board has considered their significant contribution in the growth of the Company and has proposed their re-appointment for a second term of 5 years w.e.f. 1st April, 2019 to 31st March, 2024 subject to the approval of the members by way of special resolution. Further that the age of Mr. T.N.Unni is crossed the age limit of 75 years, therefore, he can be re-appointed by way of the special resolution only.
Your Board recommend to pass necessary resolution as set out in the notice of the Annual General Meeting.
CHANGES IN OTHER KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Section 203 of the Act, during the year under review, there were no changes in the position of KMPs.
NUMBER OF MEETINGS OF THE BOARD
The Board met 5 (five) times during the financial year 2017-18.The meeting details are provided in the corporate governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
The Company has disclosed on its website (https://www.sayajihotels.com/data/Familiarization _ programme_for_Independent_directors.pdf) details of the familiarization programs formulated to educate the Directors regarding their roles, rights and responsibilities in the Company and the nature of the industry in which the Company operates, the business model of the Company, etc.
SELECTION OF NEW DIRECTORS AND BOARD MEMBERSHIP CRITERIA
The Board is Responsible for the selection of new directors. The Board delegates the screening and selection process to the nomination and remuneration committee, which consists majority of independent directors. The Committee, based on defined criteria, makes recommendations to the Board on the induction of the new directors. The Policy for the Selection and Appointment of Directors is publicly available on the Companyâs website at www.sayaji.com which forms the part of this Annual Report.
ANNUAL EVALUATION OF THE BOARD
One of the key functions of the Board is to monitor and review the Board evaluation framework.
The Nomination and Remuneration Committee and the Board have laid down the manner in which formal annual evaluation of the performance of the Board, committees and individual directors has to be made.
All Directors responded through a structured questionnaire giving feedback about the performance of the Board, its Committees, Individual directors and the Chairman. The questionnaire included inputs on composition, culture, functioning, information availability, compliance and governance, effectiveness etc. Questionnaire also covered, in the case of individual directors, qualitative assessment and in the case of Chairman additional criteria like leadership qualities and other key aspects of his role.
The Individual Directorsâ responses to the questionnaire on the performance of the Board, Committee(s), Directors and Chairman, were analyzed by an independent consultant, to arrive at unbiased conclusions.
The inputs, including areas of improvement, given by all the directors were discussed in the meeting of the Independent Directors held on 14th February, 2018.
1. Criteria for evaluation of board of directors as a whole
i. The frequency of meetings;
ii. The length of meeting;
iii. The administration of meeting;
iv. The number of committee and their note;
v. The flow of information to board members and between board members;
vi. The quality and quantity of information; and
vii. The Disclosure of information to the stakeholders.
2. Criteria for evaluation of the individual Directors
i. Ability to contribute and monitor corporate governance practices;
ii. Ability to contribute by introducing best practices to address top management issues;
iii. Participation in long term strategic planning;
iv. Commitment to the fulfillment of director obligations and fiduciary responsibility;
v. guiding strategy;
vi. Monitoring management performance and development;
vii. Statutory compliance and Corporate Governance;
viii. Attendance and contribution at board / Committee meetings;
ix. Time spent by each of the member; and
x. Core competence.
INTERNALCONTROL SYSTEMS
Given the nature of business and size of operations, your Company has designed a proper and adequate internal control system to ensure:
- Recording of transactions are accurate, complete and properly authorised;
- Adherence to Accounting standards and compliance to applicable statutes, Company policies and procedures;
- Effective usage of resources and safeguarding of assets.
Further, your Company, through its own independent and multidisciplinary Internal Audit function, carries out periodic risk based internal audits across locations and functions, based on the Internal Audit plan as approved by the Audit Committee of the Board.
The Internal Audit function reviews compliance vis-a-vis the established design of the Internal control, as also the efficiency and effectiveness of operations. The risks identified out of the audits are reviewed periodically and mitigation ensured. The summary of the Internal Audit findings and status of implementation of action plans for risk mitigation, are submitted to the Audit Committee every quarter for review, and concerns if any, are reported to the Board.
A CATALOG OF VARIOUS POLICIES OF THE COMPANY ARE HEREUNDER:
- Corporate Social Responsibility Policy
- Familiarization programme for Independent directors
- Material Subsidiary Policy
- Related Party Transaction Policy
- Risk Management Policy
- Remuneration and Nomination Policy
- Policy for determination of materiality
- Policy for Preservation of the Documents
DIRECTORSâ RESPONSIBILITY STATEMENT
Your Companyâs Director make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013, which is to be the best of their knowledge and belief and according to the information and explanations obtained by them:
a. that in the preparation of the annual financial statements for the year ended 31st March, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March, 31st 2018 and of the loss of the Company for the year ended on that date
c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.
f. that proper systems have been devised to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively.
COMPOSITION OF VARIOUS COMMITTEES OF BOARD OF DIRECTORS
During the year, in accordance with Companies Act, 2013, the Company has the following committee as at year ended 31st March 2018:
S.No |
Committees of the Board |
1 |
Audit Committee |
2 |
Corporate Social Responsibility Committee |
3 |
Borrowing and Investment Committee |
4 |
Nomination and Remuneration Committee |
5 |
Stakeholdersâ Relationship Committee |
The details with respect to the composition, charters and meeting held during the year, are given in detail in the âReport on Corporate Governanceâ, of the Company which forms part of this Annual Report and is available on the Companyâs website at https://www.sayajihotels.com/investors.
RELATED PARTY TRANSACTIONS
Transaction entered with the related parties defined under the Companies Act,2013 and provisions of SEBI(LODR) regulation, 2015 during the financial year 2017-18 were mainly in the ordinary course of business and on armâs length basis.. All such contracts or arrangements have been approved by the Audit Committee. No material contracts or arrangements with related parties were entered into during the year under review. Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in the Annexure 1 to this Report.
The policy on materiality of Related Party Transaction and dealing with related party transaction, as approved by the Board, is available on the Companyâs website and can be accessed at: https://www.sayajihotels.com/data/Related_Party_T ransaction_P olicy.pdf
19. STATUTORY AUDITORS
M/s K. L. Vyas & Co., Chartered Accountants, (F.R.No 003289C), the Statutory Auditors of the Company, hold office till the conclusion of the 35th Annual General Meeting(AGM) of the Company. The Board has recommended for the re-appointment of M/s K. L. Vyas & Co, Chartered Accountants (F.R.No 003289C), as the Statutory Auditors of the Company, for a term of five consecutive years, from the conclusion of this AGM till the conclusion of the 40th AGM of the Company to be held in the year 2023for approval of the Members by way of Special Resolution.
The report of the Statutory Auditors along with the Notes to Schedules is enclosed to this report and contains an Unmodified Opinion
The Auditorsâ have confirmed their eligibility under Section 141(3)(g) of the Companies Act, 2013 and the Rules framed there under for appointment as Auditors of the Company. As required under SEBI (LODR) Regulations, 2015, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the I nstitute of Chartered Accountants of I ndia.
20. SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014,the Board appointed M/s Ritesh Gupta & Co., Practicing Company Secretary, (holding Certificate of Practice bearing No 3764) to conduct Secretarial Audit for the FY 2017-18. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith marked as âAnnexure 2âin âForm No.MR-3âto this Report. The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimer.
CORPORATE GOVERNANCE
At Sayaji, Corporate Governance is all about maintaining a valuable relationship and trust with all stakeholders. We consider stakeholders as partners in our success, and we remain committed to maximising stakeholdersâ value, be it shareholders, employees, suppliers, customers, investors, communities or policy makers. This approach to value creation emanates from our belief that sound governance system, based on relationship and trust, is integral to creating enduring value for all. We have a defined policy framework for ethical conduct of businesses.
Pursuant to Regulation 24 and Regulation 34 of SEBI (LODR) Regulations, 2015, the Management Discussion and Analysis, Business Responsibility Report, Report on Corporate Governance and Auditorsâ Certificate regarding compliance with conditions of corporate governance form part of the Directorsâ Report.
CEO & CFO CERTIFICATION
As required under Regulation 17(8) of the SEBI (LODR) Regulations, 2015, Certificate signed by Mr. Raoof Razak Dhanani, Managing Director and Mr. Sandesh Khandelwal, Chief Financial Officer, for the year 2017-18 was placed before the Board of Directors in its 1st Board Meeting held on 30th Mayâ 2018 and is annexed to Corporate Governance Report.
A copy of the certificate on the financial statements for the financial year ended March, 31st 2018 is annexed along with this Report.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of theCompany is prepared in accordance with Indian Accounting Standards (ââInd ASââ)as notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from April 1, 2017 forming part of this Annual Report.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Your Company is continuously striving towards conservation of energy across all its units and has implemented various Energy Conservation programs and latest technology up gradation measures,your Company also earned foreign currency in Financial Year 2017 - 2018, The hotels are fitted with energy saving devices to conserve energy in the long run which leads to reduce energy cost and helps to promote economic, political and environmental sustainability and thus maximize profit.
Information as required under Section 134(3)(m) of the Act read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, relating to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo are furnished in Annexure 3 to this Report.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF REPORT
There are no material changes and commitment affecting the financial position of the Company between the end of the financial year and the date of this report.
DEMATERIALIZATION OF SHARES AND LIQUIDITY
The Companyâs shares are available for dematerialization with both the Depositories viz., National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). About 91.25% of the paid-up equity share capital of the Company has been dematerialized as on March 31, 2018.
LISTING & DEPOSITORY FEE
The Company has paid Annual Listing Fee for the Financial Year 2017-18 to the BSE Ltd. according to the prescribed norms & regulations. Company has also paid Annual Custody Fee to National Securities Depository Limited and to Central Depository Services.
EXTRACT OFANNUAL RETURN
As per the provisions of Section 92(3) of the Companies Act, 2013, read with the Companies (Management and Administration) Rules 2014, an extract of the Annual Return in Form MGT-9 is attached as Annexure â4â to this Report.
PARTICULARS OF REMUNERATION OF EMPLOYEES
The disclosure required to be made in terms of Section 197(12) of the Companies Act, 2013 and Rule 5(1) is annexed herewith as âAnnexure 5â.
The information as per the provision of section 197(12) of the Companies Act, 2013 and Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as under -
1 |
Name and Designation of The Employee |
Vivek Kumar Thakur (General Manager of the Sayaji Hotel -Indore Unit) |
2 |
Remuneration Received |
318250/- Monthly Gross |
3 |
Nature Of Employment, Whether Contractual Or Otherwise |
On role employee |
4 |
Qualifications And Experience Of The Employee |
Diploma in Hotel Management Experience - 18 years. |
5 |
Date Of Commencement Of Employment; |
01.06.2017 |
6 |
The Age Of Such Employee; |
41 Year (13 Nov 1976 - Date Of Birth) |
7 |
The Last Employment Held By Such Employee Before Joining The Company |
General Manager, Chancery Pavilion Bangalore |
8 |
The percentage of equity shares held by the employee in the Company within the meaning of clause (iii) of sub - rule (2) above |
None |
9 |
Whether any such employee is a relative of any director or manager of the Company and if so, name of such director or manager |
He is not relative of any director and manager. |
ACKNOWLEDGEMENTS
The Board of Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. The Boards of Directors also wish to place on record its deep sense of appreciation for the committed services by the Companyâs executives, staff and workers.
FORWARD-LOOKING STATEMENTS
This Report contains forward-looking statements that involve risks and uncertainties. When used in this Report, the words âanticipateâ, âbelieveâ, âestimateâ, âexpectâ, âintendâ, âwillâ and other similar expressions as they relate to the Company and / or its businesses are intended to identify such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Actual results, performances or achievements could differ materially fromthose expressed or implied in such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of their dates. This Report should be read in conjunction with the financial statements included herein and the notes thereto.
For and on behalf of the Board
T. N. Unni
Chairman
DIN - 00079237
Place: Indore
Date : 24.08.2018
Mar 31, 2016
To,
THE MEMBERS OF SAYAJI HOTELS LIMITED
The Directors take pleasure in presenting the 33rd Annual Report together with the Standalone and Consolidated audited financial statements for the year ended March, 31 2016. The Management Discussion &Analysis has also been incorporated into this report.
1. HIGHLIGHTS OF PERFORMANCE
During the year under review, on a standalone basis, there is an increase of 19.02% in the revenue of the Company (increased to Rs 16272.29 Lakh from Rs.13671.72 Lakhs in the previous year). Operating profit % to the sale is also improved (21.12% for current year and 20.48% for previous year). Loss before exceptional item decreased due to higher operating profits. Exceptional income includes profit on sale of restaurant business located at Pune hotel of the company.
2. FINANCIAL RESULTS
Particulars |
Stand Alone (Rs. in Lacs) |
|
Financial Year 2015-16 |
Financial Year 2014-15 |
|
Income |
16272.29 |
13671.72 |
Less: Operating Expenses |
12835.16 |
10870.65 |
Operating Profit |
3437.13 |
2801.07 |
Less: Finance Cost |
1209.27 |
1168.27 |
Profit before Depreciation |
2227.86 |
1632.80 |
Less: Depreciation |
2311.20 |
2040.60 |
Add: Depreciation written back |
0.03 |
0.00 |
Profit/(Loss) before exceptional items |
(83.31) |
(407.80) |
Exception Item |
1146.85 |
0.00 |
Profit Before Tax (PBT) |
1063.54 |
(407.80) |
Less:Tax Expenses |
||
Current Tax |
503.29 |
220.30 |
Deferred Tax |
(470.66) |
(261.05) |
Earlier Years'' Tax |
50.34 |
(102.02) |
Profit After Tax (PAT) |
980.57 |
(265.03) |
EPS (Equity Shares of Rs.10/- each) |
||
Basic |
4.92 |
(1.67) |
Diluted |
4.92 |
(1.67) |
3. DIVIDEND
Looking to the future expansion/renovation plans of the Company, your directors are not recommending dividend to the equity shareholders for financial year 2015-16.
4. SHARE CAPITAL
The paid up Equity Share Capital as on 31st March, 2016 was Rs. 2751.80 Lacs. During the year Company has allotted 83,338 10% cumulative redeemable preference shares of Rs.100/- each to the directors/promoters/promoter''s relative of the Company at premium of Rs. 50/- per shares on preferential basis. The Company has not issued shares with differential voting rights neither granted stock options nor sweat equity.
The Company''s equity shares are listed with the BSE Ltd.
5. FINANCE
Cash and cash equivalent as at 31st March, 2016 was Rs. 588.15 Lacs. The Company continues to focus on judicious management of its working capital, receivables, inventories and other working capital parameters were kept under strict check through continuous monitoring.
5.1 DEPOSITS
The Company during the year has not accepted deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014and there were no remaining unclaimed or unpaid deposits as on 31st March, 2016. Further, the Company has not accepted any amount as deposit in contravention of the provisions of the Companies Act, 2013 and the rules made there under.
5.2 PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
During the year under review the Company has made following investments pursuant to Section 186 of the Companies Act, 2013:
Name of the entity |
Relation |
Amount (Rupees in Crore) |
Particulars of investments |
Purpose for which the investment are proposed to be utilized |
Sayaji Housekeeping Services Ltd. |
Wholly Owned Subsidiary |
637.50 |
Investment into Shares |
For providing financial assistance for setting up the business |
For further details please refer to the relevant notes to the attached financial statements.
5.3 Amount propose to be transferred to the reserves
During the year under review Rs. 980.57 Lacs are proposed to be transferred to the general reserves.
6. REVIEW OF BUSINESS ACTIVITIES - EXPANSION/ UPGRADATION PLANS
SAYAJI HOTELS LTD.
- Indore
Your Director proud to announce that during the year your Company''s Indore hotel has obtained 5 STAR RATING. In order to maintain its status your Company has also renewed some of the floors of the Indore hotel. Renovation plan of one more floor and few large banquet halls are also in pipe line for the current financial year.
- Amber Convention Centre
Company''s ambitious project named as âAmber Convention Centreâ is also under progress and will be launched fully during the coming year. . This will be one of the biggest convention center of the city having capacity of approx 2000 people.
0 Barbeque-Nation Restaurants
Barbeque-Nation Hospitality Ltd. is operating 71restaurants across the country and planning to start 20 more restaurants within the current financial year. Company is also coming with its first overseas restaurant at Dubai.
0 Malwa Hospitality Pvt. Ltd.
During the year under review the âEffotelâ hotel at Indore operated by your Company''s subsidiary M/s Malwa Hospitality Pvt Ltd. has also obtained 4 STAR RATING. The Effotel has generated revenue of Rs. 1962.48 Lacs and operating profit of Rs. 413.14 Lacs during the year under review and the average occupancy for the year was 65%.
Your Company has aggressive plans to take hotels in various cities and to run the same on management contract basis. It will help your company to increase its business reach.
Changing Environment- Leading To Growth Of Hotel Industry
- Travel & Tourism''s direct contribution to world gross domestic product (GDP) and employment in 2015 was US$2.2 trillion (2015 prices) and 108 million jobs respectively.
- Taking its wider impacts, including indirect and induced contributions, into account, Travel & Tourism''s total contribution to the global economy in 2015 was US$7.2 trillion (2015 prices), which equates to 9.8% of total GDP. In terms of employment, in 2015 the Travel & Tourism sector supported 284 million jobs, or 1 in 11 of all jobs in the world.
- 2.5 million new jobs were generated directly in the sector in 2015, taking the number of direct jobs to 108 million. In total,
7.2 million new jobs were created as a result of direct, indirect and induced activity.
- The total contribution of Travel & Tourism to employment grew by 2.6% in 2015, while the total GDP contribution grew by 3.1% - faster than wider economic growth (2.3%) for the fifth consecutive year.
- In GDP growth terms, the Travel & Tourism sector outperformed several other major economic sectors in 2015, including manufacturing and retail. In employment growth terms, the Travel & Tourism sector outperformed various other select industries in 2015, including the financial services, education and health care sectors.
- At a country level, direct Travel & Tourism GDP growth outpaced economy-wide GDP growth in 127 of the 184 countries covered by the annual Economic Impact Research in 2015. Examples of economies where Travel & Tourism most markedly outperformed the wider economy in 2015 included Iceland, Japan, Mexico, New Zealand, Qatar, Saudi Arabia, Thailand, and Uganda.
- The sustained demand for Travel & Tourism, coupled with the sector''s ability to consistently outperform the wider global economy and be resilient in the face of shocks, continues to underline its great significance and value as a key sector for economic development and job creation throughout the world.
Some Statistical data are represented below:-
RISING CONTRIBUTION TO INDIAâS GDP
- Tourism in India accounts for 7.5 per cent of the GDP and is the third largest foreign exchange earner for the country
- The tourism and hospitality sector''s direct contribution to GDP is USD42.8 billion in 2015
- The direct contribution of travel and tourism to GDP is expected to grow 7.2 per cent per annum from 2015 - 25 to USD85.6 billion
7. MANAGEMENT DISCUSSION AND ANALYSIS
GENERAL ECONOMIC CONDITIONS AND OPPORTUNITIES
7.1 Market Overview
-The number of Foreign Tourist Arrivals (FTAs) has grown steadily in the last three years reaching around 7.103 million during January-November 2015 (4.5 per cent growth).
- The number of FTAs in November 2015 was 815,000, registering an increase of 6.5 per cent over November
2014.
- Foreign Exchange Earnings (FEEs) from tourism during January-November 2015 were Rs 1,12,958 crore (US$ 16.94 billion), registering a growth of 1 per cent over the same period of last year.
- The number of tourists arriving on e-Tourist Visa during the month of October 2015 reached a total of 56,477 registering a growth of 1987.9 per cent or 21 times as compared to 2,705 tourists in October 2014.
- Online hotel bookings in India is continuously rising and are expected to double by 2016 due to the increasing penetration of the internet and smart phones.
(Source: www.ibef.org)
7.2 Continued Growth in Investment in Tourism Sector
The tourism & hospitality sector is among the top 15 sectors in India to attract the highest Foreign Direct Investment (FDI). During the period April 2000 to September 2015, the hotel and tourism sector attracted around US$ 8.48 billion of FDI, according to the data released by Department of Industrial Policy and Promotion (DIPP).
With the rise in the number of global tourists and realizing India''s potential, many companies have invested in the tourism and hospitality sector. Some of the recent investments in this sector are as follows:
- Fairfax-owned Thomas Cook has acquired Swiss tour operator Kuoni Group''s business in India and Hong Kong for about Rs 535 crore (US$ 80.3 million) in order to scale up inbound tour business
- US-based Vantage Hospitality Group has signed a franchise agreement with India-based Miraya Hotel Management to establish its mid-market brands in the country.
- Thai firm Onyx Hospitality and Kingsbridge India hotel asset management firm have set up a joint venture (JV) to open seven hotels in the country by 2018 for which the JV will raise US$ 100 million.
- ITC is planning to invest about Rs 9,000 crore (US$ 1.35 billion) in the next three to four years to expand its hotel portfolio to 150 hotels. ITC will launch five other hotels - in Mahabalipuram, Kolkata, Ahmadabad, Hyderabad and Colombo -by 2018.
- Goldman Sachs, New-York based multinational investment banking fund, has invested Rs 255 crore (US$ 38.3 million) in Vatika Hotels.
- Capital investment in the tourism and hospitality sector has been rising consistently
- Investments are expected to increase at a CAGR of 8.6 per cent during 2009-25F
- By 2025, investments are expected to increase to
- The government''s collective spending on the tourism and hospitality sector is estimated to be USD2.4 billion in 2015
- Collective government spending on tourism is expected to grow at a CAGR of 9.1 per cent from 2008-15
- By 2025F, the government''s collective spending is expected to increase to USD7.0 billion
- Based on specific themes, government had identified five circuits which includes Krishna Circuit, Buddhist Circuit, Himalayan Circuit, North East Circuit and Coastal Circuit
- USD98.3 million has been allocated for Swadesh Darshan under the Union Budget 2015 -16
- National Mission on Pilgrimage Rejuvenation and Spiritual Augmentation was implemented by the Ministry for enhancing the facilities provided and infrastructure at pilgrimage centers of all cities
- During the Union Budget 2015 - 16, an investment of USD16.4 million was allocated
- Formulation of National Tourism Policy 2015 that would encourage the citizens of India to explore their own country as well as position the country as a âMust See'' destination for global travelers
- In FY15, USD1.13 million has been sanctioned to Kerala for development of tourism in the state
- In October 2015, Andhra Pradesh government signed memorandum of Understandings for 8 tourism projects worth USD203.1 million
- In August 2015, Tourism Ministry has sanctioned USD16.35 million or the âIntegrated Development of Eco-Tourism Circuit'' in Mahabubnagar district of Telangana
7.4 Advantage to Hotel Industries in India:-
Robust demand
- Foreign tourist arrivals expected to increase at a CAGR of 7 per cent over 2005-25
- India registered 7.1 million foreign tourist arrivals in 2015 (January to November), registering an annual growth of 5.4 per cent over the previous year
Attractive opportunities
- India has a diverse portfolio of niche tourism products -cruises, adventure, medical, wellness, sports, MICE, ecotourism, film, rural and religious tourism
- India is expected to receive nearly half a million medical tourists by 2015, implying an annual growth of 30 per cent.
Diverse attractions
- India offers geographical diversity, attractive beaches, 30 World Heritage Sites and 25 biogeography zones
- The country''s big coastline is dotted with a number of attractive beaches.
Policy support
- The Visa on Arrival scheme was extended to 150 countries in 2015
- A five-year tax holiday has been offered for 2, 3, and 4 star category hotels located around UNESCO World Heritage sites (except Delhi and Mumbai)
7.5 EMERGING TOURISM AND HOSPITALITY SEGMENTS
The aim is to develop interest in heritage and TOURISM culture; and promote visits to village settings to experience and live a relaxed and healthy lifestyle
-A wide range of adventure sports are covered under this category with specialized packages
ADVENTURE
TOURISM -The activities include mountaineering, trekking, bungee jumping, mountain biking, river rafting, and rock climbing
The luxury travel market is projected to reach LUXURY USD14.7 billion in 2015 and it was pegged to TOURISM grow at 25 per cent on a year - on - year basis between 2013 and 2015
Tourists seek specialized medical treatments, MEDICAL mainly ayurvedic, spa and other therapies
TOURISM -The primary purpose is achieving, promoting or maintaining good health and a sense of well-being
7.6 RISING REVENUES FROM LEISURE AND BUSINESS SEGMENTS
0 Revenues from leisure travel constitute over 83 per cent of total tourism revenues in India
0 Revenues from leisure travel totaled USD95.95 billion in 2015 and are estimated to reach USD153.72 billion by 2025
0 Business travel revenues stood at USD19.09 billion in 2015 and are projected to reach over USD41.4 billion by 2025
8. INTERNAL COMPLAINT COMMITTEE (SHWW PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
We always desired to work in a safe and healthy environment the major component of which is equality. That''s why at Sayaji, we have constituted an internal complaint committee to provide protection against sexual harassment of the women at the work place and for prevention and redressal of the complaints of sexual harassment.
The Committee is constituted as per the Sexual Harassment of Woman at Workplace (Prevention, Prohibition And Redressal) Act, 2013.
9. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
As the average net profit of the Company for last 3 years is negative hence there is no liability on the Company to incur expenditure on CSR activities as prescribed u/s 135 and schedule VII of the Companies Act, 2013. Ever so, the Company has constituted the CSR Committee of the Board and the CSR Policy has also been approved by the Board and placed on the Company''s website at www.sayajihotels.com
As the Company is not coming under the purview of Section 135 of the Companies Act, 2013 hence is not required to provide particulars of CSR.
10. RISK AND CONCERN
10.1 Industry Risk
-General economic conditions
The hospitality industry is prone to impacts due to fluctuations in the economy caused by changes in global and domestic economies, changes in local market conditions, excess hotel room supply, reduced international or local demand for hotel rooms and associated services, competition in the industry, government policies and regulations, fluctuations in interest rates and foreign exchange rates and other social factors. Since demand for hotels is affected by world economic growth, a global recession could also lead to a downturn in the hotel industry.
- Socio-political risks
In addition to economic risks, your Company faces risks from the socio-political environment, internationally as well as within the country and is affected by events like political instability, conflict between nations, threat of terrorist activities, occurrence of infectious diseases, extreme weather conditions and natural calamities, etc. which may affect the level of travel and business activity.
- Competition from Global Hotel Chains
The Indian subcontinent, South East Asia and Asia Pacific with high growth rates have become the focus area of major global hotel chains. Several of these chains have announced their plans to establish hotels to take advantage of the demand supply imbalance. These entrants are expected to intensify the competitive environment. The success of our Group will be dependent upon its ability to compete in areas such as quality of accommodation, brand recognition, service level, convenience of location, the quality and scope of other amenities, including food and beverage facilities.
- Increased outbound travel
Recent competitiveness in international airfares and strengthening financial health of Indian people resulted in destinations like Europe, South East Asia and Australia becoming more affordable to the average Indian travelers. This has increased outbound travel and presents a risk to the domestic segment for leisure tourism.
10.2 Risk mitigation initiatives
Our Company employs various policies and methods to counter
these risks effectively, as enumerated below:
-Your Company has implemented various security measures at all its properties which inter alia include screening of guest''s luggage, installation of metal detectors etc. to counter the security risk.
- By extensively improving its service standards, as also progressively renovating its properties, across the multi brand portfolio, your Company counters the risk from growing competition and new supply. Further, it gains operating and financial leverage, by expansion through management contracts and leveraging the strengths of its Associates.
- By removing obsolete technology and adopting modern methodology, we endeavor to control the cost of services provided by the Company.
- To attract the customers in lean period by providing attractive packages.
- Aggressive marketing through various offline and online mediums.
10.3 Policies that deal with Risk Management
- The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.
- The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.
- The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.
- The Company has a vigil mechanism named "Whistle Blower/Vigil Mechanism Policy" to deal with instance of fraud and mismanagement, if any.
- The details of the Whistle Blower/Vigil Mechanism Policy is explained in the Corporate Governance Report and also posted on the website of the Company.
11. HUMAN RESOURCES -
As in the Hotel Industry is based on serving human to human hence, it becomes imperative to have the people who possess adequate knowledge, skills and qualities so that the firms can succeed and grow not only within domestic boundaries but also in the national arena. The Company continues to maintain a very cordial and healthy relationship with its work force across all its units. The total number of permanent employees on roll as at March 31, 2016 was 2136 across all its units.
With the increase in work force due to expansion in business, envisage the requirement of adequate on-the-job training across the various levels of employees, a major thrust to the training and development of multi skilled certification programmes has been provided to the Trainees.
A dynamic and transparent performance appraisal system that is KPI Score technique which imparts various positive initiatives towards employee welfare requirements ensured maintaining the employees'' morale at greater heights.
12. SAFETY, HEALTH AND ENVIRONMENT
Providing and supporting a safe and secure environment for our guests, employees and those working at or otherwise visiting our hotels and corporate offices is of paramount importance and therefore Sayaji applies high standards of health and safety across the Group. We ensure the protection and well-being of those working for Sayaji through suitable work-based strategies enumerated below:-
- minimize the risk of injury from work activity;
- ensure that sufficient information and systems are in place to address health and safety concerns;
- involve employees in the continuous improvement,
- I Reporting and review of health and safety matters.
Recognizing the importance of operating safe hotels, our commitment to safety, security and crisis management in hotels is a fundamental part of being a responsible business. We therefore require hotels to comply with a set of global Brand Safety Standards. We also support hotel owners, General Managers and hotel employees to manage risk effectively by giving them a systematic approach and framework to follow and providing them with user-friendly tools and training.
Hotels are assessed by various methods, including self assessment, guest satisfaction surveys, design and engineering plans, incidents, intelligence gathering, quality audits and risk management reviews. Hotel management teams discuss issues periodically and develop action plans where risks are prioritized, responsibilities assigned and improvement actions identified, progressed and monitored. Action plans are reviewed as necessary by appropriate people to escalate and drive action or develop common solutions.
13. PERFORMANCE OF THE SUBSIDIARY COMPANIES -AUDITED FINANCIAL STATEMENTS OF THE COMPANYâS SUBSIDIARIES
As on 31stMarch, 2016, the Company had 3 subsidiaries and 1 Associate Company. During the year Sayaji has incorporated a wholly owned Subsidiary named as Sayaji Housekeeping Services Limited, accordingly the number of subsidiaries of the Companies has increased from 2 to 3 during the year under review. There was no change in the nature of business of the subsidiaries.
In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and all its subsidiary and Associate companies, which is forming part of the Annual Report. A statement containing salient features of the financial statements of the subsidiary/associate companies is also included in the Annual Report.
In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.sayajihotels.com.
Further, as per fourth proviso of the said section, audited annual accounts of each of the subsidiary companies have also been placed on the website of the Company, www.sayajihotels.com. Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary at the Company''s Registered Office or e-mail to [email protected]
14. BOARD OF DIRECTORS AND OTHER KEY MANAGERIAL PERSONNEL& BOARD MEETINGS
The Board of directors of the Company is duly constituted and Company is having total 7 directors in the Board, out of that 2 are Independent since the Chairman of the Company is Independent director, the Company needs to have at least 1/3 of the total number of directors as per the requirement of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015, however, presently Company has only 2 independent director. Company is looking for a suitable person to be appointed as Independent Director and will comply the requirement shortly.
14.1 Changes in the composition of Board of directors
During the year Madhya Pradesh Financial Corporation has withdrawal the nomination of Mr. Y.S. Mehta (DIN 00418859) from the Board of the Company w.e.f. 08th Dec., 2015 (since the entire loan amount of corporation has been repaid by the Company). Mr. Vinit Shah, (DIN 00118610) resigned from the Board on 19th December 2015. The designation of Mr. Raoof Dhanani (DIN 00174654) has been changed to Managing Director of the Company w.e.f. 05th November, 2015.
Except above, there were no changes done in the constitution of the board.
14.2 Independent Directors
The Company has received the necessary declaration from Independent Directors that is Mr. T. N. Unni and Mr. Pradeep Goyal in accordance with Section 149(7) of the Companies Act, 2013, that they meets the criteria of independence as laid out in sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (LODR) Regulations, 2015 and the Board of directors are satisfied that all the independent directors of the Company fulfill the criteria of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.
14.3 Retirement by rotation -
In accordance with the provisions of Section 152(6) of the Companies Act, 2013and in terms of Articles of Association of the Company, Mrs.Suchitra Dhanani (DIN 00712187) is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer herself for re-appointment. The Board recommends her appointment.
14.4 Changes in other Key Managerial Personnel
During the Year Mr. Raoof Razak Dhanani has been designated as KMP w.e.f 5th Nov. 2015. Except this there were no changes done in the position of KMP.
14.5 Number of meetings of the Board
The Board met six times during the year at regular intervals to discuss and decide on Company/business policy and strategy apart from other Board business, however, in case of a special and urgent business need, the Board''s approval is taken by passing resolutions through circulation, as permitted by law, which are confirmed in the subsequent Board meetings.
The notice of Board meeting is given well in advance to all the Directors. The detailed Agenda of the Board/Committee meetings circulated at least a week prior to the date of the respective meetings. The Agenda for the Board and Committee meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.
The details of all the Board Meetings are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.
14.6 Familiarization Programme for Independent Directors
The Company has put in place a programme to familiarize the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. The details of the familiarization programme are disclosed at the website of the Company at www.sayajihotels.com.
14.7 Selection of New Directors and Board Membership Criteria
The Nomination and Remuneration Committee works with the Board to determine the appropriate characteristics, skills and experience for the Board as a whole and its individual members with the objective of having a Board with diverse backgrounds and experience in business, government, education and public service. Characteristics expected of all Directors include independence, integrity, high personal and professional ethics, sound business judgment, ability to participate constructively in deliberations and willingness to exercise authority in a collective manner. The âNomination and Remuneration Policyâ for appointment and removal of Directors and determining Directors'' independence which forms part of the Annual Report and also placed at the website of the Company at www.sayajihotels.com.
14.8 Annual evaluation of the Board
The Board evaluated the effectiveness of its functioning and that of the Committees and of individual directors by seeking their inputs on various aspects of Board/Committee Governance.
The aspects covered in the evaluation includes:-
i. Contribution to and monitoring of corporate governance practices,
ii. participation in the long-term strategic planning and the fulfillment of Directors'' obligations and fiduciary responsibilities, including but not limited to, active participation at the Board and Committee meetings.
iii. Attendance of Board Meetings and Board Committee Meetings
iv. Strategic perspectives or inputs regarding future growth of Company and its performance
v. Providing perspectives and feedback going beyond information provided by the management
vi. Not just making Commitment but also putting efforts to achieve those commitments made to shareholder and other stakeholder interests
15. INTERNAL CONTROL SYSTEMS
The Board of Directors and key managerial persons are responsible for ensuring that internal financial controls have been laid down in the Company and that such controls are adequate and are functioning effectively. Sayaji has policies, procedures, and management systems in place that map into the definition of Internal Controls as detailed in the Companies Act, 2013. These have been established at the entity and process levels and are designed to ensure compliance to internal control requirements, regulatory compliance and appropriate recording of financial and operational information.
15.1 A Catalog of Various Polices of the Company are hereunder:
- Corporate Social Responsibility Policy
- Familiarization programme for Independent directors
- Material Subsidiary Policy
- Related Party Transaction Policy
- Risk Management Policy
- Remuneration and Nomination Policy
- Policy for determination of materiality
The Audit Committee met the Company''s Statutory and Internal Auditors to ascertain their views on financial statements, including the financial reporting system, compliance to accounting policies and procedures, the adequacy and effectiveness of the internal controls and systems followed by the Company. The Management acted upon the observations and suggestions of the Audit Committee
16. DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c)of the Companies Act, 2013:
a. that in the preparation of the annual financial statements for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March, 31st 2016 and of the profit of the Company for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,
2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
17. COMPOSITION OF VARIOUS COMMITTEES OF BOARD OF DIRECTORS
During the year, in accordance with the Companies Act, 2013, the Board re-constituted some of its Committees. There are currently six Committees of the Board, as follows:
- Audit Committee
- Corporate Social Responsibility Committee
- Borrowing and Investment Committee
- Nomination and Remuneration Committee
- Stakeholders'' Relationship Committee
Details of all the Committees along with their charters, composition and meetings held during the year, are provided in the âReport on Corporate Governanceâ, a part of this Annual Report and also placed at the website of the Company at www.sayajihotels.com
18. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval.
The policy on Related Party Transactions as approved by the Board is uploaded on the Company''s website. A disclosure as required under section 134(3)(h) of the Companies Act, 2013 and the Rule 8(2) of the Companies (Accounts) Rules, 2014 being enclosed in the Form AOC-2 as âAnnexure A" with the Board''s Report.
19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS -
During the financial year Company has received notice from Indore Development Authority âIDAâ for cancellation of the lease for the entire land of Indore Hotel Property on the ground that the Company has constructed some shops on the land and sold the same. Since IDA has not provided opportunity of personal hearing to the Company therefore, Company has filed a writ petition before the Honorable High Court of Madhya Pradesh (Indore Bench) for cancellation of the order of IDA. The honorable High Court has passed the order in favor of the Company and quashed the order.
As per High Court directions, IDA has granted the opportunity of personal hearing and heard company''s plea on this matter. Presently the matter is pending with IDA itself.
Except above, 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. STATUTORY AUDITORS
M/s K. L. Vyas & Co., Chartered Accountants, (F.R.No 003289C) the statutory auditors of the Company, eligible for ratification of their appointment in the ensuing AGM. Members of the Company at the AGM held on 23rd August, 2014 had approved the appointment of M/s K. L. Vyas & Co., as the Statutory Auditors for a term of 4 financial years as required by the provisions of the Companies Act, 2013, their appointment needs to be ratified by members each year at the AGM. Accordingly, requisite resolution forms part of the notice convening the AGM.
The Auditors'' have confirmed their eligibility under Section 141(3)(g) of the Companies Act, 2013 and the Rules framed there under for ratification for appointment as Auditors of the Company. As required under SEBI (LODR) Regulations, 2015, the auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
21. SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Neelesh Gupta& Co., a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith in the Form MR-3 as âAnnexure Bâ.
22. ENHANCING SHAREHOLDERS VALUE
Sayaji believes that âtry not to become a person of success, but rather try to become a person of valueâ.
Accordingly, your Company provides great importance to the shareholders, and the operations which are committed to the pursuit of achieving high levels of operating performance and cost competitiveness, consolidating and building for growth, enhancing the productive asset and resource base and nurturing overall corporate reputation. Your Company is also committed to creating value for its other stakeholders by ensuring that its corporate actions positively impact the socio-economic and environmental dimensions and contribute to sustainable growth and development.
23. CORPORATE GOVERNANCE
At Sayaji, we ensure that we evolve and follow the corporate governance guidelines and best practices sincerely to not just boost long-term shareholder value, but to also respect minority rights. We consider it our inherent responsibility to disclose timely and accurate information regarding our financials and performance, as well as the leadership and governance of the Company. Pursuant to the SEBI (LODR) Regulations, 2015, the Management Discussion and Analysis, the Corporate Governance Report and the Auditors'' Certificate regarding compliance of conditions of Corporate Governance are made part of the Annual Report.
23.1. CEO & CFO Certification
Certificate from Mr. Raoof Razak Dhanani, Managing Director and Mr. Sandesh Khandelwal, Chief Financial Officer, pursuant to provisions of Regulation 17 and subregulation 8 of the SEBI (LODR) Regulations, 2015, for the year under review was placed before the Board of Directors of the Company at its meeting held on 30th May, 2016.
A copy of the certificate on the financial statements for the financial year ended March, 31, 2016 is annexed along with this Report.
24. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company prepared in accordance with relevant Accounting Standards (AS) viz. AS 21, AS 23and AS 27 issued by the Institute of
Chartered Accountants of India form part of this Annual Report.
25. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Energy conservation means to reduce the quantity of energy that is used for different purposes. This practice may result in increase of financial capital, environmental value, national and personal security, and human comfort.
Individuals and organizations that are direct consumers of energy may want to conserve energy in order to reduce energy costs and promote economic, political and environmental sustain ability. Industrial and commercial users may want to increase efficiency and thus maximize profit.
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013read with Rule, 8 of The Companies (Accounts)Rules,
2014, is annexed herewith as âAnnexure Câ.
26. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments, if any, 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.
27. EXTRACTOFANNUAL RETURN
The details forming part of the extract of the Annual Return as on 31st March, 2016 in form MGT- 9 is annexed herewith as âAnnexure Dâ.
28. PARTICULARS OF REMUNERATION OF EMPLOYEES
The disclosure required to be made in terms of Section 197(12) of the Companies Act, 2013 and Rule 5(1) is annexed herewith as âAnnexure Eâ.
During the year there was no âemployee drawing remuneration'' required to be disclosed as per the provision of section 197(12) of the Companies Act, 2013 and Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
29. ACKNOWLEDGEMENTS
Our Directors thanks various Central and State Government Departments, Organizations and Agencies for the continued help and co-operation extended by them. The Directors also gratefully acknowledge all stakeholders of the Company viz. customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued contribution to the Company.
30. ADVISORY STATEMENT
Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward-looking within the meaning of applicable securities laws and regulations.
Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company''s operations include global and domestic demand and supply conditions affecting charges of rooms & selling prices of finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within the country and other factors such as litigation and industrial relations.
For and on behalf of the Board of Directors
T. N. Unni Chairman
Place : Indore DIN 00079237
Date : 06.08.2016
Mar 31, 2015
To THE MEMBERS OF SAYAJI HOTELS LIMITED
The Directors take pleasure in presenting the 32nd Annual Report
together with the Standalone and Consolidated audited financial
statemen for the year ended March, 31 2015. The Management Discussion
and Analysis has also been incorporated into this report.
1. HIGHLIGHTS OF PERFORMANCE
During the year under review, on a standalone basis, there is an
increase of 10% in the revenue of the Company (increased to 13671.72
Lacs from Rs.12417.08 Lacs in the previous year) and 8.66% in the
operating profit (increased to Rs. 2801.07 Lacs fro Rs.2577.72 Lacs in
the previous year). The loss before exceptional item increased due to
heavy amount of depreciation on account adoption of schedule II of the
Companies Act, 2013 for calculation of Depreciation.
2. FINANCIAL RESULTS
Stand Alone (Rs. in Lacs)
Particulars Financial
Year 2014-15 Financial
Year 2013-14
Income 13671.72 12417.08
Less: Operating Expenses 10870.65 9839.36
Operating Profit 2801.07 2577.72
Less: Finance Cost 1168.27 1303.45
Profit before Depreciation 1632.80 1274.27
Less: Depreciation 2040.60 1507.43
Add: Depreciation written back 0.00 0.52
Profit/(Loss) before exceptional items (407.80) (232.64)
Exception Item 0.00 1056.14
Profit Before Tax (PBT) (407.80) 823.50
Less:Tax Expenses Current Tax 220.30 375.66
Deferred Tax (261.05) (106.64)
Earlier Years' Tax (102.02) 0.00
Profit After Tax (PAT) (265.03) 554.48
EPS (Equity Shares of Rs.10/- each)
Basic (1.67) 3.17
Diluted (1.67) 3.17
3. DIVIDEND
Looking to the losses suffered in the current year, your directors are
unable to recommend the dividend to the equity shareholders for
financial year 2014-15.
4. SHARE CAPITAL
The paid up Equity Share Capital as on 31st March, 2015 was Rs.2668.46
Lacs. During the year Company has allotted 9,16,662 10% cumulative
redeemable preference shares of Rs.100/- each to the
directors/promoters/promoter's relative of the Company at premium of
Rs. 50/- per shares .The Company has not issued shares with
differential voting rights neither granted stock options nor sweat
equity.
5. FINANCE
Cash and cash equivalent as at 31st March, 2015 was Rs. 95.09 Lacs.
The Company continues to focus on judicious management of its working
capital, receivables, inventories and other working capital parameters
were kept under strict check through continuous monitoring.
5.1 DEPOSITS
The Company has not accepted deposit from the public falling within the
ambit of Section 73 of the companies Act, 2013 read with the Companies
(Acceptance of Deposits) Rules, 2014 and there were no remaining
unclaimed or unpaid deposits as on 31st March, 2015.
The Company has filed Form DPT-4 for the amount which was considered as
deposits upon commencement of the aforesaid provisions as on 1st April,
2014 and has repaid the entire amount before the end of the financial
year 2015 and has complied with the provisions of the Act and Rules
made there under.
5.2 PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The Company has provided following loans and guarantees and made
following investments pursuant to Section 186 of the Companies Act,
2013:
Amount Particulars of
Name of the entity Relation (Rupees in loans, guarantees
Crore) and investments
Malwa Hospitality
Pvt.Ltd. Subsidiary of the 24.51 Corporate
Company Guarantee
Barbeque-Nations Presently 40.00 Corporate
Hospitality Ltd.1 Associates of the Guarantee
Company
Sana Hospitality Promoters 4.21 Corporate
Services Pvt. Ltd.2 Relative's
Company Guarantee
Barbeque-Nations Associate 0.26 Investment
Hospitality Limited Company
Malwa Hospitality
Pvt. Ltd. Subsidiary 1.40 Investment
Company
Name of the Entity Purpose for which the loan, guarantee and
investment are proposed to be utilized
Malwa Hospitality
Pvt Ltd Malwa Hospitality has taken loan of Rs. 24.00
Cr. from State Bank of India for constructing
its hotel project and Rs. 0.51 Cr. Car Loan from
HDFC Bank Ltd. Company being its holding Company
has provided its Corporate Guarantee.
Barbeque-Nations
Hospitality Ltd Company has earlier provided Corporate
Guarantee for term loan availed by Barbeque-
Nations Hospitality Ltd., being its subsidiary
at that time. However, presently it is having
status of Associate Company in which company
has 47.40% shareholding.
Sana Hositality
Services Pvt Ltd Company has provided Corporate Guarantee for
term loan availed by Sana Hospitality Services
Pvt. Ltd. for its restaurant business.
Barbeque-Nations
Hospitality Limited Company has exercised its right of share
warrants and made investment in 2,60,560 equity
shares of Barbeque-Nations Hospitality Ltd. of
Rs. 10/- each.
Malwa Hositality
Pvt Ltd Investment Company has made investment in
14,00,000 equity shares of Malwa Hospitality
Pvt. Ltd. of Rs. 10/- each.
1. Company has provided guarantee before the commencement of Companies
Act, 2013
2. Company has provided guarantee before the commencement of Companies
Act, 2013
In addition to the above, the Company has given advance against salary
or otherwise to employees of the Company as per the terms of
appointment and as per Company's policy on which no interest were
charged.
5.3 Amount proposed to transfer to the reserves
During the year under review your directors do not propose to transfer
any amount to the general reserves.
6. REVIEW OF BUSINESS ACTIVITIES - EXPANSION / UPGRADATION PLANS
SAYAJI HOTELS LTD.
- Indore
During the year under review Company has renewed various mini banquet
halls of the hotel. Renovation plan of three floors and some large
banquet halls are also in pipe line for the current financial year
- Bhopal
During the year Company has successfully launched its Bhopal Unit. Unit
got tremendous response from the city and did business of Rs. 7.23
Crores in just 4.5 months' time. Company is expecting to achieve new
milestones during current financial year.
- Amber Garden
Company is coming with grand convention/banquet hall in the city of
Indore having capacity of approx 2000 people. The construction work of
the hall is in full swing and is expected to be done by October, 2015.
BARBEQUE-NATION RESTAURANTS
Barbeque-Nation Hospitality Ltd. is operating 43 restaurants across the
country and planning to start 10 more restaurants within the current
financial year.
MALWA HOSPITALITY PVT. LTD.
During the previous financial year Company has successfully launched
its 181 keys hotel project under the brand "Effotel" in the Indore city
under its subsidiary Malwa Hospitality Pvt Ltd. Effotel received more
than expected response from the City. Effotel started its business from
the month of July, 2014 and achieved occupancy of 49%.
Looking to the above said warm response, Management of the Company is
planning to open more "Effotel" in tier 2 and small cities.
7. HOTEL INDUSTRY OUTLOOK AND BUSINESS ENVIRONMENT
During 2015, the industry's contribution to global GDP is forecasted to
grow by 3.7% and employment by 2.6%. This demonstrates the sector's
enduring ability to generate economic growth and create jobs at a
faster rate than the global economy, which is due to grow by 2.9% in
2015.
By the end of 2015, the Travel & Tourism sector will contribute
US$7,860 billion, 10% of global GDP, once all direct, indirect and
induced impacts are taken into account. The sector will account for
284 million jobs, 9.5% of total employment, or one in eleven of all
jobs on the planet.
This is forecasted that the United States and China will retain their
rankings as the two biggest Travel & Tourism economies in the world,
but Germany has overtaken Japan to rank as the third largest Travel &
Tourism economy. Russia is the only G20 country expected to register a
decline in Travel & Tourism growth in 2015, due to the continuing
sanctions being imposed and the devaluation of the rouble (Russian
currency).. South Asia is expected to experience the highest growth in
2015 at 6.9%, whilst Europe and Latin America are the regions with the
lowest forecast growth of 2.4%.
Long-term forecasts for Travel & Tourism shows continued annual growth
at 3.8% over the next ten years to $11.4 trillion. By 2025, the global
Travel & Tourism sector is expected to contribute 357 million jobs,
some 73 million more jobs than this year.[Source: WTTC]
Looking to the above said forecast and outlook for travel and tourism
industry, the expected future of hotel industry in India is also
promising.
8. MANAGEMENT DISCUSSION AND ANALYSIS
GENERAL ECONOMIC CONDITIONS AND OPPORTUNITIES
Market Size
- The number of Foreign Tourist Arrivals (FTAs) in India has grown
steadily in the last three years reaching around 7.46 million during
JanuaryÂDecember 2014. Foreign exchange earnings (FEEs) from tourism in
terms of US dollar grew by 7.1 per cent during January-December 2014 as
compared to 5.9 per cent over the corresponding period of 2013. FTAs
during the Month of December 2014 were Rs 120,083 Crore (US$ 19.02
billion) as compared to FTAs of Rs 107,671 Crore (US$ 17.05 million)
during January-December 2013 over the corresponding period of 2012.
There has been a growth of 6.8 per cent in December 2014 over December
2013.
- Foreign Exchange Earnings (FEEs) during the month of December 2014
were Rs 12,875 Crore (US$ 2.03 billion) as compared to Rs 11,994 Crore
(US$1.9 billion) in December 2013 and Rs 10,549 Crore (US$1.67 billion)
in December 2012.The growth rate in FEEs in rupee terms in December
2014 over December 2013 was 7.3 per cent. FEEs from tourism in rupee
terms during January-December 2014 were Rs 120,083 (US$ 1,902.53) with
a growth of 11.5 per cent over the corresponding period of 2013.
- The Tourist Visa on Arrival (TVoA) scheme enabled by Electronic
Travel Authorization (ETA), launched by the Government of India on
November 27, 2014 for 43 countries has led to a growth of 1,214.9
percent recently. For example, during the month of January 2015, a
total of 25,023 tourist arrived by availing TVoA as compared to 1,903
TVoA during the month of January 2014.
- Hospitality, a major segment of tourism, has grown by 10-15 per cent
on the back of better consumer sentiment with the change of Government.
As demand is going up occupancies are improving.
Investments
The tourism and hospitality sector is among the top 15 sectors in India
to attract the highest foreign direct investment (FDI). During the
period April 2000-February 2015, this sector attracted around US$
7,862.08 million of FDI, according to the data released by Department
of Industrial Policy and Promotion (DIPP).
With the rise in the number of global tourists and realizing India's
potential, many companies have invested in the tourism and hospitality
sector. Some of the recent investments in this sector are as follows:
- US-based Vantage Hospitality Group has signed a franchise agreement
with India-based Miraya Hotel Management to establish its mid-market
brands in the country.
- Thai firm Onyx Hospitality and Kingsbridge India hotel asset
management firm have set up a joint venture (JV) to open seven hotels
in the country by 2018 for which the JV will raise US$ 100 million.
- ITC is planning to invest about Rs 9,000 Crore (US$ 1.42 billion) in
the next three to four years to expand its hotel portfolio to 150
hotels. ITC will launch five other hotels - in Mahabalipuram, Kolkata,
Ahmedabad, Hyderabad and Colombo - by 2018.
- Goldman Sachs, New-York based multinational investment banking fund,
has invested Rs 255 Crore (US$ 40.37 million) in Vatika Hotels.
Government Initiatives
The Indian government has realized the country's potential in the
tourism industry and has taken several steps to make India a global
tourism hub. Some of the major initiatives taken by the Government of
India to give a boost to the tourism and hospitality sector of India
are as follows:
- The Government of India has set aside Rs 500 Crore (US$ 79.17
million) for the first phase of the National Heritage City Development
and Augmentation Yojana (HRIDAY). The 12 cities in the first phase are
Varanasi, Amritsar, Ajmer, Mathura, Gaya, Kanchipuram, Vellankani,
Badami, Amaravati, Warangal, Puri and Dwarka.
- Under 'Project Mausam' the Government of India has proposed to
establish cross cultural linkages and to revive historic maritime
cultural and economic ties with 39 Indian Ocean countries.
- Prime Minister has approved to enter into a memorandum of
understanding (MoU) between India and Oman for strengthening
cooperation in the field of tourism.
- Announcement by Minister of Finance, to extend Visa on Arrival
Facility (VOA) to 150 countries in stages from the current 43, is a big
step to promote tourism. The revenue from tourism sector can be
utilized for the development of the country and can boost the economy
of country.
Road Ahead
India's travel and tourism industry has huge growth potential. The
medical tourism market in India is projected to hit US$ 3.9 billion
mark this year having grown at a compounded annual growth rate (CAGR)
of 27 per cent over the last three years, according to a joint report
by FICCI and KPMG. Also, inflow of medical tourists is expected to
cross 320 million by 2015 compared with 85 million in 2012. The tourism
industry is also looking forward to the E-visa scheme which is expected
to double the tourist inflow to India. Enforcing the electronic travel
authorization (ETA) before the next tourism season, which starts in
November, will result in a clear jump of at least 15 per cent, and this
is only the start.
ICRA Ltd rating agency expects the revenue growth of Indian hotel
industry strengthening to 9-11% in 2015-16.
India is projected to be number one for growth globally in the wellness
tourism sector in the next five years, clocking over 20% gains annually
through 2017, according to a study conducted by SRI
International.[Source: Indian Brand Equity Foundation]
9. RISK AND CONCERN
Hotels form one of the most important support services that affect the
arrival of tourist to a country. The strengths of the industry includes
that India is one big package of culture and legend that never fails to
captivate the imagination of the visitor. It provides vast natural and
cultural diversity, the manpower costs in the Indian hotel industry is
reasonable in the world. The peak season in the country is from
September to March. Over the long term, the hotel industry has growth
potential. When it comes to diverse topography, India is one of the
best destinations.
Tourists also have second thoughts about visiting India because of the
political turbulence and negative publicity about the country. Growth
in hotel supply in recent times has outstripped demand in a number of
Indian cities. Escalating land prices, increasing energy costs,
depleting water levels and a scarcity of trained manpower are
challenges that are needed to be addressed and overcome. With
increasing affluence in India, the composition of the market is
undergoing a change. Domestic travel and tourism is experiencing rapid
growth as is domestic corporate travel. These segments will require
due attention whilst we continue to focus on traditional markets.
Source markets are changing with demand from the SAARC nations, China,
Japan and the Middle East growing steadily. The tourism Ministry will
need to orient itself to this development.
Risk Management
There has been considerable progress in implementing a structured risk
management framework in the Company. The framework is now well
documented with laid down dissemination procedures and this is updated
periodically.
Your Company formulated various Polices and measures to effectively
counter the risks as enumerated below:-
- To control the cost of services provided by the Company.
- To ensure effective and optimum uses of the resources of the Company.
- To cater the business for medium income and lower income group.
- To attract the customers in lean period by providing attractive
holiday packages.
- Aggressive marketing through various online mediums viz. Online
Travels Agents, GDS, RFPs, optimization of search engines etc.
10. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
As the average net profit of the Company for last 3 years is negative
hence there is no liability on the Company to incur expenditure on CSR
activities as prescribed u/s 135 and schedule VII of the Companies Act,
2013. The Company has constituted the CSR Committee of the Board and
the CSR Policy has also been approved by the Board and placed on the
Company's website at www.sayajihotels.com
Details about the CSR policy of the Company is attached herewith in
"Annexure A"
11. HUMAN RESOURCES -
At Sayaji we believe that "company grows when its people grow". During
the year, we continued our focus on building a performing and growing
organization by introducing many new HR initiatives. We started a
systematic performance appraisal system based on the use of KPI Score
technique, initiated extensive training of manpower etc. All the
perspectives like customer  centric approach, learning, trust,
initiatives, communication etc. were evaluated and appraised during the
quarterly appraisal cycle. HR personnel facilitated face to face
discussion between the subordinate and the supervisors and various
parameters were introduced to facilitate bias free appraisal system.
For better talent acquisition we used employment portals and social
media and even employee referral was given priority. We hired many
interns from college campus. To provide a better learning environment
to them, agenda was well prepared in advanced and most of the interns
were even offered full- time employment at Sayaji. Competitive
incentive plans were laid down for the operational teams.
On the employee engagement front, lot of motivational activities was
planned for the employees throughout the year. Various outbound
programs like trip to Goa and Bangkok, Sports week were also organized
to motivate the employees and rejuvenate them. Camps on blood donation
and regular health checkup were undertaken.
Lots of efforts were taken to train the employees on various behavioral
and technical aspects. Various in- house training module were prepared
and delivered by HR team to the employees to enhance their competencies
and skills. Team building, communication skills, meditation session and
training on goal setting and proper performance management were also
imparted. For the senior management, leadership training was imparted
to develop leadership facet. Sayaji has therefore worked on building an
employer brand with strong employee value preposition and has developed
a culture that promotes independent decision making. The number of
persons employed by Sayaji group was 2075 which included 224 employees
of Malwa Hospitality Pvt. Ltd., as on March 31, 2015.
12. SAFETY, HEALTH AND ENVIRONMENT
Health and Safety Management System in the Company aims to reduce,
eliminate or control workplace hazards and associated risks of illness
or injuries to the employees, customers and contractors who might be
affected by the Company's work activities.
Your Company is committed to ensure healthy and safe working
environment for all concerned and to make continual improvement in its
Health and Safety performance. Through a systematic process, the
Company aims to:
- Comply with the requirements of all relevant statutory, regulatory
and other provisions.
- Provide and maintain safe & healthy work place through operational
procedures, safe systems and methods of work.
- Provide sufficient information, instruction, training and supervision
to enable all employees to identify, minimize and manage hazards and to
contribute positively to safety at work.
- Ensure that appropriate resources are available to fully implement
Health and Safety policy and continuously review the policy's relevance
with respect to legal and business development.
- Conduct audits and mock drills on site to ensure that operations are
in compliance with Health and Safety management requirements and for
emergency preparedness.
Your Company attaches utmost importance to safety standards at all
units of the Company. At all the hotels and restaurants of the company,
necessary steps are regularly undertaken to ensure the safety of
employees, equipment and the customers. Internal safety checks are
conducted regularly. Fire-fighting training is provided to staff and
mock drills are conducted to gauge emergency and disaster management
preparedness.
The Company believes in good health of its employees. To pursue this
objective, efforts are being made on both treatment as well as
maintaining good health. The Company has a club and gymnasium at its
Indore & Pune hotel premises, where the employees are allowed and
encouraged for participation. Yoga training course is also conducted in
the club premises. Programmes have been conducted to advice employees
on ill-effect on health due to excessive consumption of liquor and
tobacco.
The Company's hotels maintain clean and hygienic environment and keep
strict vigilance on their effluent generation and disposal adhering to
standard norms in order to protect the environment and surroundings.
13. RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY
The Company has in place a mechanism to identify, assess, monitor and
mitigate various risks to key business objectives. Major risks
identified by the businesses and functions are systematically addressed
through mitigating actions on a continuing basis. These are discussed
at the meetings of the Audit Committee and the Board of Directors of
the Company.
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. To maintain its objectivity and
independence, the Internal Audit function reports to the Chairman of
the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficacy and
adequacy of internal control system in the Company, its compliance with
operating systems, accounting procedures and policies at all locations
of the Company and its subsidiaries. Based on the report of internal
audit function, process owners undertake corrective action in their
respective areas and thereby strengthen the controls. Significant aud
it observations and corrective actions thereon are presented to the
Audit Committee of the Board.
14. VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has a vigil mechanism named Whistle Blower/Vigil Mechanism
Policy to deal with instance of fraud and mismanagement, if any.
The details of the Whistle Blower/Vigil Mechanism Policy is explained
in the Corporate Governance Report and also posted on the website of
the Company.
15. SUBSIDIARY COMPANIES - AUDITED FINANCIAL STATEMENTS OF THE
COMPANY'S SUBSIDIARIES
As on 31st March, 2015, the Company had 2 subsidiaries and 2 Associate
Companies. During the year number of the subsidiaries of the Companies
has been reduced from 3 to 2. During the year under review there was
no changes done in the nature of business of the subsidiaries. In
accordance with Section 129(3) of the Companies Act, 2013, the Company
has prepared a consolidated financial statement of the Company and all
its subsidiary companies, which is forming part of the Annual Report. A
statement containing salient features of the financial statements of
the subsidiary/ associate companies is also included in the Annual
Report.
In accordance with third proviso of Section 136(1) of the Companies
Act, 2013, the Annual Report of the Company, containing therein its
standalone and the consolidated financial statements has been placed on
the website of the Company, www.sayajihotels.com. Further, as per
fourth proviso of the said section, audited annual accounts of each of
the subsidiary companies have also been placed on the website of the
Company, www.sayajihotels.com. Shareholders interested in obtaining a
copy of the audited annual accounts of the subsidiary companies may
write to the Company Secretary at the Company's registered office or
e-mail to [email protected]
16. BOARD OF DIRECTORS
The Board of Directors had appointed Mr. Pradeep Goyal and Mr. Vinit
Shah as Additional Directors of the Company in the category of
Independent Directors with effect from 06th February, 2014 and 4th
July, 2014 respectively to 31st March, 2019. Thereafter, at the Annual
General Meeting (AGM) of the Company held on 23rd August, 2014, the
Members of the Company appointed the said Directors as Independent
Directors under the Companies Act, 2013 for a period of 5 years with
effect from 06th February, 2014 and 4th July, 2014 respectively to 31st
March, 2019.
At the said AGM held on 23rd August, 2014,the Members also appointed
Mr. T. N. Unni as Independent Director under the Act for term of five
years i.e. till 31st March, 2019.
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
Capt. Salim Sheikh has resigned from the post of Director w.e.f. 04th
July, 2014. The Board has placed on record its appreciation for the
outstanding contributions made by Capt. Salim Sheikh during his tenure
of office.
Mr. T. N. Unni, Independent Director of the Company was appointed as
Chairman of the Board of directors Company w.e.f. 30th May, 2015 for
the tenure of one year.
In accordance with the provisions of the Companies Act, 2013 and in
terms of the Memorandum and Articles of Association of the Company, Mr.
Raoof Razak Dhanani is retiring by rotation and being eligible offers
himself for re- appointment.
16.1 Number of meetings of the Board
The Board meets at regular intervals to discuss and decide on
Company/business policy and strategy apart from other Board business.
The Board/Committee Meetings are pre- scheduled and a notice of the
meetings is provided to directors well in time to facilitate them to
plan their schedule and to ensure meaningful participation in the
meetings. However, in case of a special and urgent business need, the
Board's approval is taken by passing resolutions through circulation,
as permitted by law, which are confirmed in the subsequent Board
meeting.
The notice of Board meeting is given well in advance to all the
Directors. The Agenda of the Board/Committee meetings is circulated at
least a week prior to the date of the meeting. The Agenda for the Board
and Committee meetings includes detailed notes on the items to be
discussed at the meeting to enable the Directors to take an informed
decision.
The Board met 15 times in financial year 2014-15. The maximum interval
between any two meetings did not exceed 120 days.
16.2 Board Independence
Our definition of 'Independence' of Directors is derived from Clause 49
of the Listing Agreement with Stock Exchanges and Section 149(6) of the
Companies Act, 2013. Based on the confirmation/disclosures received
from the Directors and on evaluation of the relationships disclosed,
the following Non-Executive Directors are Independent in terms of
Clause 49 of the Listing Agreement and Section 149(6) of the Companies
Act, 2013:-
a) Mr. T. N. Unni
b) Mr. Vinit Shah
c) Mr. Pradeep Goyal
16.3 Company's policy on Directors' appointment and remuneration
The Nomination and Remuneration Committee framed "Nomination and
Remuneration Policy" and adopted the same vide its meeting held on
04.07.2014 and the said policy has been approved by the Board in its
board meeting which was scheduled on the same date. The details of
Nomination and Remuneration Committee and the said policy have been
provided under Corporate Governance Report, which forms part of the
Annual Report and also placed at the website of the Company at
www.sayajihotels.com.
16.4 Annual evaluation by the Board
The evaluation framework for assessing the performance of Directors
comprises of the following key areas:
i. Attendance of Board Meetings and Board Committee Meetings
ii. Quality of contribution to Board deliberations
iii. Strategic perspectives or inputs regarding future growth of
Company and its performance
iv. Providing perspectives and feedback going beyond information
provided by the management
v. Commitment to shareholder and other stakeholder interests
The evaluation involves Self-Evaluation by the Board Member and
subsequently assessment by the Board of Directors. A member of the
Board does not participate in the discussion of his/her evaluation.
17. DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the
information and explanations obtained by them, your Directors make the
following statements in terms of Section 134(3)(c)of the Companies Act,
2013:
a. that in the preparation of the annual financial statements for the
year ended 31st March, 2015, the applicable accounting standards have
been followed along with proper explanation relating to material
departures, if any;
b. that such accounting policies as mentioned in Notes to the
Financial Statements have been selected and applied consistently and
judgment and estimates have been made that are reasonable and prudent
so as to give a true and fair view of the state of affairs of the
Company as at March, 31st 2015 and of the profit/loss of the Company
for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going
concern basis;
e. that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
18. COMMITTEES OF THE BOARD
During the year, in accordance with the Companies Act, 2013, the Board
re-constituted some of its Committees and also formed a Corporate
Social Responsibility Committee. There are currently six Committees of
the Board, as follows:
(a) Audit Committee
(b) Corporate Social Responsibility Committee
(c) Borrowing and Investment Committee
(d) Nomination and Remuneration Committee
(e) Stakeholders' Relationship Committee
(f) Share Transfer Committee
Details of all the Committees along with their charters, composition
and meetings held during the year, are provided in the "Report on
Corporate Governance", a part of this Annual Report.
19. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the
financial year were on an arm's length basis and were in the ordinary
course of business. There are no materially significant related party
transactions made by the Company with Promoters, Directors, Key
Managerial Personnel or other designated persons which may have a
potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee
and also the Board for approval. Prior omnibus approval of the Audit
Committee is obtained for the transactions which are of a foreseen and
repetitive nature. The transactions entered into pursuant to the
omnibus approval so granted are audited and a statement giving details
of all related party transactions is placed before the Audit Committee
and the Board of Directors for their approval.
The policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website. A disclosure as required under
section 134(3)(h) of the Companies Act, 2013 and the Rule 8(2) of the
Companies (Accounts) Rules, 2014 being enclosed in the Form AOC-2 as
"Annexure E" with the Board's Report.
20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
21. STATUTORY AUDITORS
The Company's Auditors, M/s K. L. Vyas & Co., Chartered Accountants,
who were appointed for a term of 4 years at the Annual General Meeting
of the Company held on 23rd August, 2014 are eligible for ratification
of their appointment. They have confirmed their eligibility under
Section 141(3)(g) of the Companies Act, 2013 and the Rules framed there
under for ratification for appointment as Auditors of the Company. As
required under Clause 49 of the Listing Agreement, the auditors have
also confirmed that they hold a valid certificate issued by the Peer
Review Board of the Institute of Chartered Accountants of India.
22. SECRETARIAL AUDIT
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 Ritesh Gupta & Co., a firm
of Company Secretaries in Practice to undertake the Secretarial Audit
of the Company. The Secretarial Audit Report is annexed here within the
Form MR-3 as "Annexure B".
23. ENHANCING SHAREHOLDERS VALUE
Your Company believes that its Members are amongst its most important
stakeholders. Accordingly, your Company's operations are committed to
the pursuit of achieving high levels of operating performance and cost
competitiveness, consolidating and building for growth, enhancing the
productive asset and resource base and nurturing overall corporate
reputation. Your Company is also committed to creating value for its
other stakeholders by ensuring that its corporate actions positively
impact the socio-economic and environmental dimensions and contribute
to sustainable growth and development.
24. CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate section on corporate governance practices followed by the
Company, together with a certificate from the Company's Auditors
confirming compliance forms an integral part of this Report.
24.1. CEO & CFO certification
Certificate from Mrs. Suchitra Dhanani, Whole-Time Director and Mr.
Sandesh Khandelwal, Chief Financial Officer, pursuant to provisions of
Clause 49(IX) of the Listing Agreement, for the year under review was
placed before the Board of Directors of the Company at its meeting held
on 30th May, 2015.
A copy of the certificate on the financial statements for the financial
year ended March, 31, 2015 is annexed along with this Report.
25. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company prepared in
accordance with relevant Accounting Standards (AS) viz. AS 21, AS 23
and AS 27 issued by the Institute of Chartered Accountants of India
form part of this Annual Report.
26. ENERGY CONSERVATION, 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 of The Companies
(Accounts)Rules, 2014, is annexed herewith as "Annexure C".
27. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
OF THE COMPANY
There have been no material changes and commitments, if any, 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.
28. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return as on 31st
March, 2015 in form MGT- 9 is annexed herewith as "Annexure D".
29. PARTICULARS OF REMUNERATION OF EMPLOYEES
The disclosure required to be made in terms of Section 197(12) of the
Companies Act, 2013 and Rule 5(1) is annexed herewith as "Annexure F".
During the year there was no 'employee drawing remuneration' required
to be disclosed as per the provision of section 197 (12) of the
Companies Act, 2013 and Rule 5(2) of Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
30. ACKNOWLEDGEMENTS
Your Directors Thanks various Central and State Government Departments,
Organizations and Agencies for the continued help and co-operation
extended by them. The Directors also gratefully acknowledge all
stakeholders of the Company viz. customers, members, dealers, vendors,
banks and other business partners for the excellent support received
from them during the year. The Directors place on record their since
reappreciation to all employees of the Company for their unstinted
commitment and continued contribution to the Company.
31. CAUTIONARY STATEMENT
Statements in the Board's Report and the Management Discussion &
Analysis describing the Company's objectives, expectations or forecasts
may be forward-looking within the meaning of applicable securities laws
and regulations.
Actual results may differ materially from those expressed in the
statement. Important factors that could influence the Company's
operations include global and domestic demand and supply conditions
affecting charges of rooms & selling prices of finished goods, input
availability and prices, changes in government regulations, tax laws,
economic developments within the country and other factors such as
litigation and industrial relations..
For and on behalf of the Board of Directors
T. N. Unni
Chairman
Place : Indore DIN 00079237
Date : 12.08.2015
Mar 31, 2014
The Members
The Board presents the Thirty First Annual Report together with the
Audited Annual Accounts and the Auditor''s Report thereon of the Company
for the year ended 31st March,2014.
FINANCIAL RESULTS (Rs. in Lacs)
Particulars Financial Year 2013-14 Financial Year 2012-13
Income 12417.08 11826.44
Less: Operating
Expenses 9839.36 9131.57
Operating Profit 2577.72 2694.87
Less: Financial Cost 1303.45 1757.04
Profit/(Loss) before
Depreciation, Tax &
Exceptional Item 1274.27 937.83
Less: Depreciation 1507.43 1731.46
Add: Deprciation
Written Back 0.52 1.98
Profit/(Loss)
before Tax &
Exceptional Item (232.64) (791.65)
Exceptional Items
(Expenses/(Income) (1056.14) 2393.99
Profit/(Loss)
before Tax 823.50 (3185.64)
CurrentTax 375.66 129.99
Deferred Tax (106.64) (1232.24)
Profit (loss)
for the year 554.48 (2082.69)
BASIC EPS 3.17 (11.89)
DILUTED EPS 3.17 (11.89)
REVIEW OF OPERATIONS:
During the year under review, on a standalone basis, there is an
increase of 5% in the topline and revenue of the company has increased
from Rs.11826.44 Lacs to Rs. 12417.08 Lacs. The Profit before
Depreciation, Tax & Exceptional Items has shown improvement as compared
to previous year and has increased from Rs. 937.83 Lacs to Rs. 1274.27
Lacs and consequently Loss before Tax & Exceptional Items has decreased
from Rs. 791.65 Lacs to Rs. 232.64 Lacs. However, during the year
under review the profit after tax was at Rs. 554.48 Lacs, which was on
account of sale of 415000 Equity Shares Rs. 10/- each of
Barbeque-Nation Hospitality Ltd.,a subsidiary of the Company on which
your company earned profit of Rs. 1104.98 Lacs, which is shown under
exceptional items.
Looking to the future expansion plans in short term, your Directors
have not recommended any dividend for the financial year 2013-2014 in
order to conserve the resources.
CONSOLIDATED FINANCIAL STATEMENTS:
The consolidated turnover of the Company for the year ended March 31,
2014 aggregated to Rs. 39045.24 Lacs as against Rs. 30167.11 Lacs for
the previous year. Profit after Tax aggregated to Rs. 1376.85 Lacs for
the year as against the Loss after Tax of Rs. 3873.25 Lacs for the
previous year. The increase in consolidated turnover and resultant
increase in Profit after Tax is mainly on account of increase in
Turnover from Sale of Food & Beverages in Barbeque-Nation Hospitality
Ltd., a subsidiary of the Company.
The company during the year has increased its stake in Aries Hotels
Pvt. Ltd., an associate, resultantly it has become a subsidiary with
effect from 31.03.2014.
SUBSIDIARY COMPANIES:
Pursuant to of General Circular No. 2/2011 dated 8th February, 2011,
issued by the Ministry of Corporate Affairs, Government of India, your
Board of directors have opted to avail the general exemption granted
under Section 212(8) of the Companies Act, 1956 from attaching
individual balance sheet, statement of profit & loss and reports of the
Board of Directors and Auditors of the subsidiaries along with the
holding company''s balance sheet. However, the Consolidated Financial
Statements of the Subsidiaries and auditors report in accordance with
relevant Accounting Standard of the Institute of Chartered Accountants
of India, duly audited by the Statutory Auditors, form part of the
Annual Report and are reflected in the Consolidated Accounts.
During the year under review, your company has subscribed to 4968000
Equity Shares of Rs. 10/- each at the premium of Rs. 5/- per
share in Aries Hotels Pvt. Ltd. an associate company, by virtue of this
investment, Aries Hotels Pvt. Ltd. became the subsidiary of the
Company.
The Financial Statements of the Subsidairy Companies and other detailed
information will be made available to the investors seeking such
information at any point of time. The Annual Accounts of the subsidiary
companies will also be available for inspection at the Registered
Office of the Company as well as the respective registered officesand
its subsidiaries'' respectively.
EXPANSION / UP-GRADATION PLANS:
SAYAJI HOTELS LTD.
- Indore
During the year under review, your company has upgraded 2 Floors of its
Hotel at Indore, incurring Rs. 5.30 Cr. This upgradation will result
in an increase in Turnover of the Company in coming years.
- Bhopal
Your Company is planning to start its F&B and Banquet business at
Bhopal i.e. Capital of Mahdya Pradesh by the month of September, 2014.
The venue will have two restaurants and few banquet options. It will
also have 25 rooms.
- Amber Garden, Indore
Company has 200000 Sq. Ft. open garden space near Dewas bypass in the
city of Indore (M.P) and this is being used mainly for marriage
functions and other events. Company is planning to construct a large
banquet hall having capacity of more than 1000 persons and expect to
capture good amount of conference, convention and other business
through this expansion.
- Vadodara
Company is also planning to start new F&B and Banquet options over
there.
BARBEQUE-NATION RESTAURANTS
Barbeque-Nation Hospitality Ltd. i.e. subsidiary of the Company is
operating 38 restaurants across the country and its planning to open 10
more restaurants within this financial year.
MALWA HOSPITALITY PVT LTD.
Malwa Hospitality Pvt. Ltd. i.e. subsidiary of the company will be
opening its first business category hotel in Indore by June 2014. This
will be opened under a separate brand name viz. EFFOTEL. It has 182
rooms, two restaurants and fewsmall banquet options.
ARIES HOTELS PVT LTD.
Aries Hotels Pvt. Ltd. has a land in the city of Ankleshwar (Gujarat)
whereupon building structure of 72 rooms is ready. Company is planning
to open an hotel over there in near future and also planning to open
some F&B venues in the next financial year.
DIRECTORS
Mr. Abdul Razak Dhanani and Mr. Kayum Razak Dhanani, retires by
rotation in accordance with the provisions of the Articles of
Association of the Company & being eligible offer themselves for
re-appointment.
The Board appointed Mr. Raoof Razak Dhanani as an Additional Director
of the Company w.e.f. 14th Nov., 2013 and he shall hold office upto the
date of ensuing annual general meeting. The Company has received
requisite notice in writing from a member proposing Shri Raoof Razak
Dhanani for appointment as a director. Your Board proposes to pass
suitable resolutions as set out in the notice of the Annual General
Meeting.
Mrs. Suchitra Dhanani was appointed as an Additional Director and
further as the Whole - Time Director of the Company w.e.f. 6th Day of
February, 2014, and she is categorized as Key Managerial Personnel.
Being an additional director she shall hold office upto the date of
ensuing annual general meeting. The Company has received requisite
notice in writing from a member proposing Mrs. Suchitra Dhanani for
appointment as a Director.
Your Board further recommends her appointment as a Whole-time Director
w.e.f. 6th Feb., 2014 and proposes to pass suitable resolution as set
out in the notice of the Annual General Meeting as a Whole Time
Director.
Mr. Vineet Shah was appointed as additional director of the Company
w.e.f. 04th Day of July, 2014 and he shall hold office upto the date of
ensuing annual general meeting. The Company has received requisite
notice in writing from a member proposing Mr. Vineet Shah for
appointment as a Director. Your Board recommends his appointment and
proposes to pass suitable resolution as set out in the notice of the
Annual General Meeting as a director.
The Board has also appointed Mr. Pradeep Goyal as additional director
of the Company w.e.f. 06th Day of February, 2014 and he shall hold
office upto the date of ensuing annual general meeting. The Company has
received requisite notice in writing from a member proposing Mr.
Pradeep Goyal for appointment as a Director. Your Board recommends his
appointment and proposes to pass suitable resolution as set out in the
notice of the Annual General Meeting as a director.
Mr. T. S. Bhattacharya has resigned from the Board of directors w.e.f.
11th September, 2013 and Capt. Salim Sheikh has also resigned w.e.f.
4th July, 2014.
Your Board places on record their sincere appreciation of the valuable
services rendered by Mr. T. S. Bhattacharya and Capt. Salim Sheikh.
The Company has received declaration from Mr. Pradeep Goyal, Mr.
Vineet Shah and Mr. T.N.Unni the independent directors of the Company
confirming that they meet with the criteria of independence as
prescribed both under section 149(6) of the Companies Act, 2013 and
Clause 49 of the listing agreement.
AUDITORS & AUDITORS REPORT
M/s. Shah Gandhi & Shah, Chartered Accountants and M/s K. L. Vyas &
Company, Chartered Accountants are the joint statutory auditors of the
Company, and were appointed to hold office, in accordance with the
provisions of the Companies Act, 1956 to hold office up to the
conclusion of the forthcoming AGM.
M/s. Shah Gandhi & Shah, Chartered Accountants, existing joint auditors
of the Company, have now expressed their unwillingness to be
reappointed as auditors of the company for the current year.
Your directors sincerely thank and appreciate the valuable services
rendered by them.
M/s K.L. Vyas & Company, Chartered Accountants is being eligible have
furnished their letter to the effect that their re-appointment, if
made, would be within the prescribed limit as per section 141(3)(g) of
the Companies Act, 2013 and that they are not disqualified for re-
appointment as thestatutoryauditors ofthe Company.
The Notes on Financial Statements referred to in the Auditors Report
are self explanatory and do not call for any further comments.
FIXED DEPOSITS
The Company has renewed/accepted deposits by private placement and
confidential offers from friends, relatives and associates under
Section 58A of the Companies Act, 1956 in terms of Rule 4A of the
Companies (Acceptance of Deposit) Rules, 1975. However, the Company
will repay all the deposit within the year or maturity date whichever
is earlier as per the requirement of section 74 of the Companies Act,
2013.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement undersection 217 (2AA) ofthe Companies Act,
1956, with respect to the Directors'' Responsibility Statement, it is
herebyconfirmed that:
1. In the preparation of the accounts for the financial year ended
March 31,2014, the applicable accounting standards have been followed
along with proper explanation relating to material departures;
2. The Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as on March 31,2014 and of the results of
operations of the Company for the year underreview;
3. The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions ofthe Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities; and
4. The Directors have prepared the annual accounts of the Company on
going concern basis..
CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVE TAKEN
The Company has formed the CSR Committee with its members as Mr. T.N.
Unni, Mrs. Suchitra Dhanani and Mr. Pradeep Goyal and the committee
will perform its activities according to CSR policy finalized by the
Board during the year.
CORPORATE GOVERNANCE
As per the requirement of Clause 49 of the Listing Agreement with the
Stock Exchanges, a Report on Corporate Governance together with an
Auditor''s Certificate on Corporate Governance is appended to the Annual
Report as Annexure ''C'' and ''D'' respectively.
CONSERVATION OF ENERGY, TECHNOLOGYABSORPTION ETC. Pursuant to Section
217(1)(e) of the Companies Act 1956, read with
rules made there under, the Company is not required to give the
particulars ofthe conservation of energy, since the Hotel industry is
not covered under the list of Industries required to provide such
information.
The Company has not absorbed any new technology during the year under
review. The inflow and Outflow of Foreign Exchange during the year
under review are as under:
Foreign Exchange Inflow : Rs. 697.51 Lacs
Foreign Exchange Outgo : Rs. 8.78 Lacs
PARTICULARS OF EMPLOYEES
Information in accordance with sub-section (2A) of Section 217 of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 none of the employees of the Company was drawing
remuneration requiring to be disclosed as per provision of section 219
(1)(b)(iv) ofthe Companies Act, 1956.
ACKNOWLEDGEMENT
Your Directors would like to express their sincere appreciation for the
co-operation and support received from shareholders, bankers, financial
institutions, regulatory bodies, customers, suppliers, employees at all
levels and other business constituents during the year under review.
For and on behalf of the Board of Directors
Place: Indore Abdul Razak Dhanani
Date : 04.07.2014 Chairman
Mar 31, 2012
The Board presents the Twenty Ninth Annual Report together with the
Audited Statement of Accounts and the Auditor's Report of the Company
for the year ended 31 st March, 2012.
FINANCIAL RESULTS (Figures in Rs. Lacs)
Particulars Financial
Year 2011-12 Financial
Year 2010-11
Income 12350.53 11258.55
Less: Operating Expenses 8620.98 7942.00
Operating Profit 3729.55 3316.55
Less: Financial Cost 2206.33 1620.22
Profit/(Loss) before Depreciation, Tax
& Exceptional Item 1523.22 1696.34
Less: Depreciation 1296.33 1225.30
Profit/(Loss) before Tax & Exceptional Item 226.89 471.04
Exceptional Item 26.04 0.00
Profit/(Loss) before Tax 200.85 471.04
Less: Provision for taxation 86.92 139.95
Profit (loss) for the period 113.94 331.09
BASIC EPS 0.65 1.89
DILUTED EPS 0.65 1.89
CASH EPS 8.55 9.68
REVIEW OF OPERATIONS
Total Revenue during the financial year 2011-12 increased to Rs.
12350.53 lacs as against Rs. 11258.55 lacs during the preceding
financial year showing an increase of 9.69 %. Operating profit during
the year is Rs. 3729.55 as compared to Rs. 3316.55 lacs during the
preceding financial year showing an increase of 12%. Profit Before Tax
during the financial year 2011-12 is Rs. 200.85 lacs as against Rs.
471.04 lacs during the financial year 2010-11. Profit after tax for the
year is Rs. 113.94 lacs during the financial year 2011 -12 as compared
to Rs. 331.09 lacs during the preceding financial year. PAT is lower on
account of the sharp increase in Interest cost by 36% due to the
overall increase in borrowing costs.
In order to conserve the resources and to be able to plug them back for
future growth, your Directors have not recommended any dividend for the
financial year 2011 -2012.
SUBSIDIARY COMPANIES
The Financial Statements for the year ended March 31, 2012 of
Barbeque-Nation Hospitality Ltd. and Malwa Hospitality Pvt. Ltd., both
subsidiaries of your company, are consolidated in the Annual Report.
CONSOLIDATED FINANCIAL STATEMENTS
The Ministry of Corporate Affairs vide their Letter no.
5/12/2007-CL-lll dated February 8,2011 has granted a general exemption
under Section 212 (8) of the Companies Act, 1956 for publication of the
Accounts of subsidiary companies, subject to fulfillment of certain
conditions. In view of the same, your Company is also exempted from
publication of the Accounts of its subsidiaries under the provision of
Section 212 of the Companies Act, 1956. The accounts of the subsidiary
companies are not separately included in the Annual Report. However,
the Consolidated Financial Statements of the Subsidiaries prepared in
accordance with relevant Accounting Standards of the Institute of
Chartered Accountants of India, duly audited by the Statutory Auditors,
form part of the Annual Report and are reflected in the consolidated
accounts.
The Financial Statements of the subsidiary companies and other detailed
information will be made available to the investors seeking such
information at any point of time. The annual accounts of the subsidiary
companies will also be available for inspection at the Registered
Office of the Company as well as the respective Registered Offices of
the subsidiary companies.
COURSE OF BUSINESS AND OUTLOOK
The annexed Management Discussion and Analysis forms part of this
Report and covers, amongst other matters, the performance of the
Company during the Financial Year 2011-12 as well as the future
outlook.
Your Company owns and operates successfully three hotels at the
locations viz. Baroda, Indore and Pune. The company is also operating
20 restaurants in different parts of India under the banner of its
subsidiary Company i.e. Barbeque-Nation Hospitality Ltd. (BNHL) and
looking to the tremendous response received by the Company in the
restaurant segment, your Company expects to start 15 more restaurants
during the current financial year. The Indian F&B services (dining out)
market is expected to touch USD 16 billion by 2016 out of which the
organized market would command USD 6 billion. The CAGR for the
organized market is projected at 30% for the period 2011 -2016.
(Source: Technopak Emerging Trends in India Retail & Consumer 2011)
Your company has decided to consolidate similar nature business of the
Barbeque - Nation in the subsidiary for the purpose of reaping benefits
of better valuation due to consolidated turnover & profits and for
administrative convenience and better statutory compliances.
Accordingly, your Company has sold five barbeque-nation restaurants and
ceded its rights in favour of its subsidiary Barbeque-Nation
Hospitality Limited at a total consideration of Rs. 28.10 crores. These
restaurants where initially opened in the company and operating rights
of the same were transferred to subsidiary w.e.f. 01 st April 2009.
In the hotel segment, the company has undertaken various expansion
projects which inter alia include setting up a business Hotel in Indore
comprising of 160 rooms under its subsidiary Company Malwa Hospitality
Pvt. Ltd., It will start operations tentatively during FY13.
PUNE HOTEL
The Pune Hotel of the Company is successful in sustaining & constantly
improving the food and beverage business over the last 3 years. During
the year no. of rooms available for supply in PCMC area has been
increased upto 200 rooms. It has also revised the rates in April 2011.
Besides all the above facts the occupancy rate was 68.32% compared to
the 80% in the year 2010-11. The overall increase in revenue is Rs.1.14
Cr as compared to previous years. During the year it has started a new
Gym in the basement of the Hotel covering the area of 1500 square feet.
In the year 2011-12 Pune has been awarded by Trip advisor "Travelers
Choice" award 2012.
DIRECTORS
CA T. N. Unni and Capt. Salim Sheikh retires by rotation in accordance
with the provisions of the Articles of Association of the Company and
being eligible offerthemselves for re-appointment.
The Board appointed Shri Jayakannan Perumal Swamy as a Whole- time
Director of the Company w.e.f. 14th Feb., 2012 for a period of 3 years
and proposes to pass suitable resolutions as set out in the notice of
the Annual General Meeting.
During the year Mr. Aswini Sahoo has been appointed as a Additional
Director of the Company w.e.f. 14th November, 2011. With effect from
08.05.2012 Mr. Karthik B. Athreya has been appointed as a additional
director in place of Mr. Aswini Sahoo. Mr. Sanjay Ahuja (TFCI) has been
nominated by TFCI in place of Mr. B. M. Gupta w.e.f. 14th February,
2012.
Mr. Munawar Garbadawala, Whole-time Director of the Company has also
resigned w.e.f. 14th August, 2012.
Your Board placed on record their sincere appreciation of the valuable
services rendered by Mr. B. M. Gupta, Mr. Munawar Garbadawala & Mr.
Aswini Sahoo.
AUDITORS
M/s Shah Gandhi & Shah, Chartered Accountants, (Firm Registration No
126862W) Auditors of the Company, hold office until the conclusion of
the ensuing Annual General Meeting and are eligible for re-appointment.
The Company has received a letter from them to the effect that their
appointment, if made, would be within the prescribed limits under
section 224(1 B) of the Companies Act 1956.
SECRETARY
During the period under review and pursuant to Section 383A of the
Companies Act, 1956 Mr. Awadhesh Gupta has resigned from the post of
Company Secretary of the Company w.e.f. 31 st July, 2011 and Mr. Amit
Sarraf has been appointed as the Company Secretary cum Compliance
Officer of the Company w.e.f. 26th September, 2011.
CORPORATE SOCIAL RESPONSIBILITY
The Company, has undertaken several Eco friendly initiatives during the
year like plantation of trees, developing & maintaining the green belt
of the road covering 2 kilometer area near the Indore hotel etc. The
Children's day was celebrated with Orphans and poor children. Your
Company also sponsors various sports tournament & coaching camps for
encouraging talent amongst children & providing opportunities to the
underprivileged segment of the society. Your Company also organizes
various shows & exhibition in order to promote art & culture in the
society. Pune hotel of the Company also supported a NGO called
"Nirmala Trust" by distributing Hand Painted diyas made by disabled
people during Diwali.The Company has also donated funds, clothes &
otherthings to poor people through various NGOs
FIXED DEPOSITS
The Company has renewed/accepted deposits by private placement and
confidential offers from friends, relatives and associates under
Section 58A of the Companies Act, 1956 in terms of Rule 4A of the
Companies (Acceptance of Deposit) Rules, 1975. The Company has matured
unclaimed Deposits amounting to Rs. 2,34,322/- (Two lacs thirty
fourthousand three hundred twenty two only only).
POSTAL BALLOT
Your Company has successfully sought the approval of members by way of
postal ballot under section 192A of the Companies Act, 1956 for passing
of the Special Resolution pertaining to the following matter:-
(a) To provide Corporate Guarantee for a Sum of Rs. 20 Crores to State
Bank of India for and on behalf of Barbeque-Nation Hospitality Ltd.;
and
(b) Authorization to Board of Directors to make loans and investments
in the securities of Other Body Corporate and to provide and extend the
guarantee for and on behalf of other body corporate subject to a
maximum amount upto 150 Crores.
Result of postal ballot has been announced on July 14th, 2012.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217 (2AA) of the Companies
Act, 1956, with respect to the Directors' Responsibility Statement,
it is hereby confirmed that:
1. In the preparation of the accounts for the financial year ended
March 31, 2012, the applicable accounting standards have been followed
along with proper explanation relating to material departures;
2. The Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company as on March 31,2012 and of the results of
operations of the Company for the year under review;
3. The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
4. The Directors have prepared the annual accounts of the Company on
going concern basis.
CORPORATEGOVERNANCE
As per the requirement of Clause 49 of the Listing Agreement with the
Stock Exchanges, a Report on Corporate Governance together with an
Auditor's Certificate on Corporate Governance is appended to the
Annual Report as Annexure 'C' and 'D' respectively.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC.
Pursuant to Section 217(1)(e) of the Companies Act 1956, read with
rules made there under, the Company is not required to give the
particulars of the conservation of energy, since the Hotel industry is
not covered under the list of Industries required to provide such
information.
The Company has not absorbed any new technology during the year under
review. The inflow and Outflow of Foreign Exchange during the year
under review are as under:
Foreign Exchange Earnings : Rs. 930.20 Lacs
Foreign Exchange Outgo : Rs. 49.88 Lacs
PARTICULARS OF EMPLOYEES
Information in accordance with sub-section (2A) of Section 217 of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975, none of the employees of the Company are drawing such
remuneration required to be disclosed as per provision of section 219(1
)(b)(iv) of the Companies Act, 1956.
Note: The Managing Director is under the contractual employment for a
period upto 31st January, 2016 and his remuneration were approved by
the Ministry of Corporate Affairs by Letter No B18238105/1 /2011 -
CL.VII Dated 19th March, 2012.
For and on behalf of the Board of Directors
Place : Indore Abdul R. Dhanani
Date: August 14th 2012 Chairman
Mar 31, 2011
Dear Members,
The Board presents the Twenty Eighth Annual Report together with the
Audited Statement of Accounts and the Auditor's Report of the Company
for the year ended 31st March, 2011.
FINANCIAL RESULTS (Figures in Rs. million)
Particulars Financial Year
2010-11 Financial Year
2009-10
Income 1125.84 819.75
Less: Operating Expenses 788.96 588.91
Profit/(Loss) before Financial Charges
and Depreciation. 336.88 230.84
Less: Financial Charges 167.23 129.39
Profit/(Loss) before Depreciation 169.65 101.45
Less: Depreciation 122.53 94.37
Profit/(Loss) before Tax 47.12 7.08
Less: Provision for taxation 23.39 11.74
Add: Mat Credit Entitlement 9.39 1.09
Profit after tax 33.12 (3.57)
Balance brought forward from previous year 95.32 98.89
Balance carried to Balance Sheet 128.44 95.32
EPS (in Rs.) 1.89 Nil
Cash EPS (in Rs.) 9.68 7.41
REVIEW OF OPERATIONS
The overall performance of the Company has improved during the year
under review, in line with the overall global economic recovery. The
total income stood at Rs. 1125.8 million, compared to Rs. 819.75
million in the previous year.
Operating Profit (EBIDTA) for the year stood at Rs. 336.88 million, an
increase of 45.94% from Rs. 230.84 million in 2009-2010.
In order to conserve the resources and to be able to plough them back
for future growth, your Directors have not recommended any dividend for
the financial year 2010-2011.
SUBSIDIARY COMPANIES
The Financial Statements for the year ended March 31, 2011 of
Barbeque-Nation Hospitality Ltd. and Malwa Hospitality Pvt. Ltd., both
subsidiaries of your company, are consolidated in the Annual Report.
CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to general exemption granted in terms of General Circular
No.2/2011 dated 8th February, 2011 issued by the Ministry of Corporate
Affairs, Government of India, regarding compliance with Section 212(8)
of the Companies Act, 1956, the Board of directors of the Company has
resolved for taking advantage for the general exemptions provided by
the Central Government from requirement for attachment of the financial
statement of the subsidiary companies and has resolved to that effect
at the Board meeting held on 3rd Sept., 2011. Therefore the Company
has not attached Balance Sheet, Profit and Loss Account and other
documents of its subsidiary companies with the Annual Report of the
Company.
However, the Company will make available these documents upon request
by any member of the Company interested in obtaining the same. Further,
these documents will also be available at the Registered Office of the
Company for inspection by any member of the Company. As required under
the aforesaid circular, a summarized statement of financial position of
the subsidiaries has been appended to this Annual Report.
The Consolidated Accounts, prepared in accordance with the Accounting
Standard 21 and Clause 32 of the Listing Agreement form part of this
Annual Report. The relevant statement as required under Section 212 of
the Companies Act, 1956 about the subsidiary companies is also given
elsewhere in this Annual Report.
COURSE OF BUSINESS AND OUTLOOK
The annexed Management Discussion and Analysis forms a part of this
Report and covers, amongst other matters, the performance of the
Company during the Financial Year 2010-11 as well as the future
outlook.
Tourism and Hospitality industry is growing and bound to grow stronger
in India owing mainly to its strong economic conditions and further due
to the splendid historical architecture, rich heritage and ancient
culture along with beautiful beaches and rural tourism, and the
inherently rooted concept of hospitality in form of "Ãtithi Devo
Bhava". Your Company owns and operates three hotels at the locations
viz. Baroda, Indore and Pune besides operating 18 restaurants in
different parts of India under same Management with its own and
subsidiary company. The Company expects to start 15 more restaurants
during the current financial year. Now, with the economy showing signs
of strengthening, business and leisure travel is picking up and your
Company is poised to benefit from this trend.
In the hotel segment, the company has undertake various expansion
projects which inter alia includes tie-up for operating a 4-5 star
hotel to be constructed by a jointly promoted company Winner Hotels
Pvt. Ltd., at Bhopal capital of Madhya Pradesh and setting up a 2-3
star budget Hotel at Indore under the subsidiary company Malwa
Hospitality Pvt. Ltd. Both of these hotels will start operations
sometime at the end of financial year 2011-2012.
PUNE HOTEL
Your Company launched the Final phase of its Pune hotel during the
FY11. The project comprising of 243 rooms has many unique features.
Your Company has endeavored to offer a number of new features to
discerning customers à a luxurious Audi Q7 to receive the guests from
Airport to the hotel and to drop them back at Airport; all 243 rooms
equipped with an Apple iTouch device, which becomes the single
centralized control for all gadgets within the room. Further, each of
the floors is intended to be a hotel in itself à one floor is designed
for single female traveler; one floor is dedicated to European guests
and one for Oriental visitors and so on. The hotel has received a good
response and is expected to meet the growing requirement of quality
accommodations at reasonable price in this fast growing city.
FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)
As the members are aware that the Company has converted 75 FCCBs@100000
US$ into 46,68,000 Equity Shares at a price of Rs. 75.00/- per equity
shares on dated 10th May 2010 as per the FCCBs Offer Circular.
M/s Clearwater Capital Partners (Cyprus) Limited (CCPCL) were the
holder of the said FCCBs and they had exercised their right to convert
those FCCBs into Equity Shares of the company at a Conversion Price of
Rs.75/-(Rupees Seventy Five Only) per Equity Share. The exchange rate
of US$ to rupee was Rs. 46.68 to one US$, being the Federal Reserve
Bank of New York's US$ to Rupee Exchange Rate on July 26, 2006 i.e. the
date mentioned in the FCCBs Offer Circular as the applicable date.
The above equity shares are ranking pari-passu with the existing equity
shares of the company in all respect and entitled to receive the
dividend same as of the old equity shares of the company."
DIRECTORS
Shri T. S. Bhattacharya and Shri Razak D. Dhanani, Directors retire by
rotation and being eligible, offer themselves for re-appointment. The
Board of Directors recommends their re-appointment as Directors. The
Board has re-appointed Shri Sajid R.Dhanani as the Managing Director of
the Company w.e.f. 1st Feb., 2011 for a further period of 5 years and
proposes to pass suitable resolutions as set out in the notice of the
Annual General Meeting.
AUDITORS
M/s Shah Gandhi & Shah, Chartered Accountants, (Firm Registration No
126862W) Auditors of the Company, hold office until the conclusion of
the ensuing Annual General Meeting and are eligible for re-appointment.
The Company has received a letter from them to the effect that their
appointment, if made, would be within the prescribed limits under
section 224(1B) of the Companies Act 1956.
FIXED DEPOSITS
The Company has renewed/accepted deposits by private placement and
offers from friends, relatives and associates under Section 58A of the
Companies Act, 1956 in terms of Rule 4A of Companies (Acceptance of
Deposit) Rules, 1975. The Company having unclaimed Deposits of Rs.
2,30,000/- (Two Lacs Thirty Thousand only).
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under section 217(2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that:
1. In the preparation of the accounts for the financial year ended
March 31, 2011, the applicable accounting standards have been followed
along with proper explanation relating to material departures;
2. 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 the
affairs of the Company as at March 31, 2011 and of the Profit of the
Company for the year under review;
3. The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities; and
4. The Directors have prepared the annual accounts of the Company on
going concern basis.
CORPORATE GOVERNANCE
A separate section on Corporate Governance and a Certificate from the
Auditors of the Company regarding Compliance of conditions of Corporate
Governance as stipulated under Clause 49 of the Listing Agreement with
the Stock Exchanges, forming part of the Annual Report is annexed.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ETC.
Pursuant to Section 217(1)(e) of the Companies Act 1956, read with
rules made there under, the Company is not required to give the
particulars of the conservation of energy, since the Hotel industry is
not covered under the list of Industries required to provide such
information.
The Company has not absorbed any new technology during the year under
review. The inflow and Outflow of Foreign Exchange during the year
under review is as under:
Foreign Exchange Earnings : Rs. 115.24 million
Foreign Exchange Outgo : Rs. 15.94 million
PARTICULARS OF EMPLOYEES
Information in accordance with sub-section (2A) of Section 217 of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975, none of the employee of the Company is drawing such
remuneration required to be disclosed as per provision of section
219(1)(b)(iv) of the Companies Act, 1956.
For and on behalf of the Board of Directors
Place : Indore Abdul R. Dhanani
Date: September 3rd 2011 Chairman