Dear Members,
Your Companys Directors are pleased to present the Twelfth Annual Report of the
Company together with the audited financial statements for the financial year ended March
31, 2018.
1. FINANCIAL PERFORMANCE
The Companys financial performance for the year ended March 31, 2018 is summarized
below:
(in Lakhs)
| particulars |
FY 2017-18 |
FY 2016-17 |
| Revenue |
38427.20 |
30951.85 |
| Depreciation and Amortization Expenses |
306.81 |
350.10 |
| Profit Before Tax |
7770.40 |
3119.61 |
| Tax Expenses |
1550.95 |
1005.67 |
| Profit For the year |
6219.46 |
2113.95 |
2. TRANSFER TO RESERVES
The Company has not transferred any amount to Reserve Account during the year under
review.
3. SHARE CAPITAL
The paid-up equity share capital of the Company as on March 31, 2018 was
2,52,11,4,060 comprising of 2,52,11,406 equity shares of 10/- each. During the year
under review, the Company has not issued shares with differential voting rights nor has
granted any stock option or sweat equity shares.
During the year under review, the Company has allotted 4,00,226 Equity shares of 10
each to Bennett Coleman and Company Limited pursuant to conversion of warrants. Also,
pursuant to the scheme of amalgamation of Momai Apparels Limited ("Transferor
Company") with the Company, 53,43,940 equity shares of face value 10/- were
allotted to the shareholders of the Transferor Company.
4. DIVIDEND
During the year under review, your Directors declared and paid an interim dividend of
0.50/- per equity share (on the face value of 10 each).
The Board has recommended a final dividend of 0.75/- per equity share (on the face
value of 10 each) for the financial year ended March 31, 2018.
The payment of the final divided is subject to declaration by the members at the
ensuing Annual General Meeting (AGM) and shall be paid to those members whose names appear
in the Register of Members of the Company as on September 21, 2018. The Register of
Members and the Share Transfer Books will remain closed from September 22, 2018 to
September 28, 2018 (both days inclusive). The AGM of the Company is scheduled to be held
on September 28, 2018.
5. I NFORMATION ON THE STATE OF AFFAIRS OF THE COMPANY
Information on the operational and financial performance, among others is given in the
Management Discussion and Analysis Report annexed to this Report and is in accordance with
the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
6. CREDIT RATING
Reflecting the improved financial strength during the year under review, the Credit
Analysis and Research Limited "CARE" has upgraded the credit rating assigned to
the Company from CARE BBB+ (Triple B plus) to CARE A (Single A); Stable with effect from
November 10, 2017, for its cash credit bank facilities.
7. HUMAN RESOURCE
The Company recognizes people as its most precious asset and it has built an open,
transparent and meritocratic culture to nurture this asset.
Human Resources ("HR") Policies of the Company are focused on developing the
potential of each employee. With this premise, a comprehensive set of HR Policy is in
place, aimed at attracting, retaining and motivating employees at all levels.
The Companys Learning & Development ("L&D") initiatives are focused
on enhancing the functional and behavioral competencies of its employees through L&D
interventions, such as Executive Development Programs, e-learning and various
classroom-based training programs.
The ratio of remuneration of each Director to the median employees remuneration and
other details in terms of Section 197 of Companies Act, 2013 read with Rule 5(1) of the
Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is annexed as "Annexure A"
to this report.
The information in respect of employees of the Company required pursuant to Rule 5(2)
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will
be provided upon request.
8. SUBSIDIARIES & ASSOCIATES
During the financial year ended March 31, 2018, AIFL Singapore PTE Limited became a
subsidiary.
The Companys Policy for determining material subsidiaries may be accessed on the
Companys website at the link: https://www.ashapurafashion.
com/investor/Policy%20for%20%20Determining%20 Material%20Subsidiary.pdf
9. PUBLIC DEPOSITS
The Company has not accepted any deposits from the public falling within the ambit of
Section 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits)
Rules, 2014.
10. LOANS, INVESTMENT AND GUARANTEES
Particulars of loans given, investment made, guarantees given and securities provided
are provided in the financial statements.
11. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All Contracts / Arrangements / Transactions entered into / by the Company during the
financial year under review with related parties were on an arms length basis and in the
ordinary course of business. There were no materiality significant related party
transactions made by the Company with Promoters, Directors, Key Managerial Personnel or
other designated persons, which may have a conflict with the interest of the Company at
large.
All Related Party Transactions were placed before the Audit Committee as also the Board
for approval. Prior omnibus approval of the Audit Committee was obtained for the
transactions which were of a repetitive nature. The Transactions entered into pursuant to
the omnibus approval so granted were reviewed and statements giving details of all related
party transactions were placed before the Audit Committee and the Board of Directors for
their approval on a quarterly basis.
The policy on Related Party Transactions as approved by the Board is uploaded on the
Companys website at the link : https://www.ashapurafashion.com/investor/
Policy%20on%20Related%20Party%20Transaction. pdf
Form AOC-2 is annexed as "Annexure-B" to this Report. The details of the
transactions with Related parties are provided in the notes to the financial statements.
12. INTERNAL CONTROL SYSTEMS
The Companys internal control system is designed to ensure operational efficiency,
protection and conservation of resources, accuracy and promptness in financial reporting
and compliance with laws and regulations. The internal control system is supported by an
internal audit process for reviewing the design, adequacy and efficacy of the Companys
internal controls, including its systems and processes and compliance with regulations and
procedures. Internal Audit Reports are discussed with the Management and are reviewed by
the Audit Committee of the Board, which also reviews the adequacy and effectiveness of the
internal controls in the Company.
The Companys internal control system is commensurate with the size, nature and
operations of the Company.
13. INTERNAL FINANCIAL CONTROLS
Internal Financial Control systems have been designed to provide reasonable assurance
with regard to recording and providing reliable financial and operational information,
complying with applicable Accounting Standards.
The Company has adopted accounting policies which are in line with the Indian
Accounting Standards notified under Section 133 of the Companies Act, 2013 read together
with the Companies (Indian Accounting Standards) Rules, 2015. These are in accordance with
Generally Accepted Accounting Principles in India. Changes in Policy, if any, are approved
by the Audit Committee in consultation with the Statutory Auditors.
The Company in preparing its financial statements makes judgments and estimates based
on sound policies and uses external agencies to verify/validate them as and when
appropriate. The basis of such judgments and estimates are also audited by the Statutory
Auditors and reviewed by the Audit Committee.
14. CORPORATE GOVERNANCE
The report on Corporate Governance as stipulated under Regulation 34 (3) read with Para
C of Schedule V to the SEBI (Listing Obligations and Disclosure Requirements), Regulations
2015, inter alia, containing the composition of the Audit Committee, details of
establishment of vigil mechanism, forms part of this report. The requisite Certificate
from the Practicing Company Secretary confirming compliance with the conditions of
Corporate Governance as stipulated under the SEBI (Listing Obligations and Disclosure
Requirements), Regulations 2015, is attached to this annual report.
15. DIRECTORS AND KEY MANAGERIAL PERSONNEL Re-appointment of Directors
In accordance with the provisions of Section 152 of the Companies Act, 2013 and
Articles of Association of the Company, Mr. Dinesh Chanubha Sodha (DIN: 02836240) and Mr.
Hitesh Subhash Punjani (DIN: 03268480), Directors of the Company will retire by rotation
at the ensuing Annual General Meeting of the Company and being eligible, offer themselves
for reappointments.
The Board recommends for the above reappointments. Items seeking your approval on the
above are included in the notice convening the Annual General Meeting. Brief resume of the
Directors being re-appointed forms part of the Notice of the ensuing Annual General
Meeting.
Key Managerial Personnel
During the year under review there were no change in the Key Managerial Personnels of
the Company.
The following Directors/Executives continued as KMPs during Financial Year 2017-18:
• Mr. Harshad Thakkar, Managing Director
• Mr. Mohit Shah, Chief Executive Officer
• Mr. Anurag Gangwal, Chief Financial Officer
• Ms. Bhoomi Mewada, Company Secretary
16. NUMBER OF MEETINGS OF BOARD OF DIRECTORS
The details of the number of meetings of the Board held during the financial year
2017-18 forms part of the Corporate Governance Report.
17. EVALUATION OF THE PERFORMANCE OF THE BOARD
Pursuant to the provisions of the Companies Act, 2013 and the Corporate Governance
Requirements as prescribe by SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Board of Directors has carried out an annual evaluation of its own
performance, and that of its Committees and Individual Directors.
The performance evaluation of the Independent Directors was carried out by the entire
Board, excluding the Director being evaluated.
The Nomination and Remuneration Policy of the Company empowers the Nomination and
Remuneration Committee to formulate a process for evaluating the performance of Directors,
Committees of the Board and the Board as a whole.
The process for evaluation of the performance of Directors/Board/Committees of the
Board for the financial year 2017-18 was initiated by the Nomination and Remuneration
Committee, by triggering surveys to all Directors.
The Directors carried out the annual performance evaluation of the Board, Committees of
Board and individual Directors along with assessing the quality, quantity and timelines of
flow of information between the Company Management and the Board that is necessary for the
Board to effectively and reasonably perform their duties.
The feedback of the Independent Directors on their review of the performance of
Non-Independent Directors and the Board as a whole, the performance of the Chairman of the
Company and the assessment of the quality, quantity and timeliness of flow of information
between the Company Management and the Board was taken into consideration by the Board in
carrying out the performance evaluation.
18. INDEPENDENT DIRECTORS
Declaration of Independence given by Independent Directors
The Company has received necessary declaration from each Independent Director under
Section 149(7) of the Companies Act, 2013, that he/she meets criteria of independence laid
down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015.
Familiarisation Programme For Independent Directors
Pursuant to requirement of Securities and Exchange Board of India vide Circular no.
CIR/CFD/POLICY CELL/7/2014 dated September 15, 2014, the Company has in place a programme
for familiarization of the Independent Directors with the Company. The details of the same
is uploaded on the Companys website at the link :
https://www.ashapurafashion.com/investor/ Familiraisation%20Programme.pdf
19. NOMINATION AND REMUNERATION POLICY
The Company has formulated and adopted the Nomination and Remuneration Policy in
pursuant to Section 178 of the Companies Act, 2013 and the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015. The said policy is provided as "Annexure
C" to this Report.
The said Policy of the Company, inter alia, provides that the Nomination and
Remuneration Committee shall formulate the criteria for appointment of Executive,
Non-Executive and Independent Directors on the Board of Directors of the Company and
Senior Management Personnels of the Company, their remuneration including determination of
qualifications, positive attributes, independence of Directors and other matters as
provided under sub-section (3) of Section 178 of the Companies Act, 2013 (including any
statutory modification(s) or re-enactment(s) thereof for the time being in force).
20. CORPORATE SOCIAL RESPONSIBILITY
The Company has constituted Corporate Social Responsibility Committee in compliance
with the provision of Section 135 of the Companies Act, 2013 read with the Companies
(Corporate Social Responsibility Policy) Rules, 2014. The Corporate Social Responsibility
Committee has formulated a Corporate Social Responsibility Policy (CSR Policy)
indicating the activities to be undertaken by the Company. The CSR policy may be accessed
on the Companys website at the link : http://www.ashapurafashion.com/
investor/CSR%20Policy.pdf
The Companys CSR Policy statement and annual report on the CSR activities undertaken
during the Financial Year ended March 31, 2018, in accordance with Section 135 of the
Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014
including statutory modification(s) or re- enactment(s) thereof for the time being in
force is set out in "Annexure D" to this Report.
21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review as stipulated under
Regulation 34(2) of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 is presented in a separate section forming part of this Annual Report.
22. EXTRACT OF ANNUAL RETURN
An extract of the Annual Return as prescribed under Section 92(3) of the Companies Act,
2013 and the Companies (Management and Administration) Rules, 2014, in the prescribed Form
No. MGT- 9, is attached as "Annexure E"to this Report.
23. AUDITORS Statutory Auditors
At the 11th Annual General Meeting of the Company held on December 29, 2017, M/s.
Bagaria & Co. LLP, Chartered Accountants (Firm Registration No. 113447W/W-100019),
were appointed as the Statutory Auditors of the Company, for a term of five years, to hold
office from the conclusion of the Eleventh AGM till the conclusion of the Sixteenth Annual
General Meeting of the Company to be held in 2022, subject to the ratification of their
appointment by the Members at every Annual General Meeting, if required under the
Companies Act, 2013.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s.
Jaiprakash Singh & Associates, Practicing Company Secretaries has been appointed as
Secretarial Auditor, to undertake Secretarial Audit of the Company for the Financial Year
2017-18. The report of the Secretarial Auditor is annexed to this report as "Annexure
F".
Auditors Observations:
There were no audit qualifications in the Statutory Auditors Report as well as in the
Secretarial Audit Report for the financial year 2017-18 as annexed to this Annual Report.
Cost Auditors:
Pursuant to the provisions of the Companies Act, 2013 and the Companies (Audit and
Auditors) Rules, 2014, and considering factors for the applicability for the Cost Audit
for the financial year 2017-18, the Cost Audit for the financial year 2017-18 was not
applicable to the Company.
24. DIRECTORS RESPONSIBILITY STATEMENT
The Board of Directors acknowledge the responsibility for ensuring compliances with the
provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 in the
preparation of the annual accounts for the year ended on March 31, 2018 and to the best of
their knowledge and ability, confirms that:
• in the preparation of the annual accounts for the financial year ended March 31,
2018, the applicable accounting standards have been followed along with proper explanation
relating to material departures, if any;
• the Directors had selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at March 31, 2018 and
of the profit of the Company for the year ended on that date;
• the Directors had taken proper and sufficient care towards 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 the fraud and
other irregularities;
• the Directors had prepared the annual accounts ongoing concern basis;
• the Directors had laid down proper Internal Financial Controls to be laid down
by Company and such financial control are adequate and are operating effectively;
• the Directors had devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems are adequate and operating
effectively.
25. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company is committed to uphold and maintain the dignity of women employees and it
has in place a policy which provides protection against sexual harassment of women at work
place and for prevention and redressal of such complaints.
The Company has constituted an Internal Complaint Committee as required under Section 4
of the Sexual Harassment of Women and at Workplace (Prevention, Prohibition and Redressal)
Act, 2013 and the rules made thereunder.
During the year, no complaints were reported.
26. SAFETY, ENVIRONMENT CONTROL AND PROTECTION
The Company is aware of the importance of environmentally clean and safe operations.
The Companys policy requires conduct of operations in such a manner, so as to ensure
safety of all concerned, compliances, environmental regulations and preservation of
natural resources at the Plant.
27. REPORTING OF FRAUDS
There have been no instances of fraud reported by the Statutory Auditors under Section
143(12) of the Companies Act, 2013 and the Rules framed thereunder either to the Company
or to the Central Government.
28. INFORMATION ON MATERIAL CHANGES AND COMMITMENTS
There are no material changes or commitments affecting the financial position of the
Company which have occurred at the end of financial year of the Company to which the
Financial Statement relate and on the date of this Report.
29. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a Whistle Blower Policy for the Directors and employees to report
genuine concerns or grievances. The Policy is available on the website of the Company at
the link: httpsy/www.ashapurafashion. com/investor/VIGIL-MECHANISM-POLICY-AIFL.pdf
The Policy provides for adequate safeguards against the victimization of the employees
who use vigil mechanism. The Vigil Mechanism is overseen by the Audit Committee.
30. CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange
earnings and outgo as stipulated under section 134(3)(m) of the Companies Act, 2013 read
with Rule 8 (3) of the Companies (Accounts) Rules, 2014 is as follows:
A. CONSERVATION OF ENERGY
i. The steps taken or impact on conservation of energy:
The Company has made concrete efforts for enhancement in the capacity utilization, cost
competitiveness and quality through systematic process monitoring and adherence to
technological norms by:
• Installation of energy efficient LED Lights in all stores
• Installation of Energy Management System in all stores
• Reducing power consumption in cooling towers
• Replacement of inefficient motor
• Technical up-gradation and modernization of various machines
• Replacement of old plant and machinery with modernization of existing machinery
ii. The Steps taken by the Company for utilising alternate sources of energy:
1. All the Store Unit maintenance head and store managers were made aware about energy
consumption of their store as per the connected load. Based on the connected load and
operating hours, budgeted energy consumption is given to each stores and practice of
taking daily logs and crosschecking the daily consumption with the budgeted units is
adopted. This helps in curbing the unwanted consumption, motivate users to take all the
possible measures to save the energy and helps in pointing out the discrepancies in the
energy consumption pattern and corrective action to eliminate the discrepancies.
2. Controlled the energy consumption of HVAC system by optimizing the temperature
inside the stores (24C). This drive is the major contributor for the energy conservation
for the stores.
3. Optimized lighting consumption by strictly controlling the operating hours as per
the usage pattern. Color coding is followed for distinguishing the different lighting and
using LED Lights in all the stores (emergency, show window, signages, floor lighting,
indirect lighting) switches; so that energy usage can be optimized.
4. Eliminated the unwanted light consumption and restricted usage of the lighting
during day work.
iii. The capital investment on energy conservation equipment:
No additional investment was made for the above purpose.
B. TECHNOLOGY ABSORPTION, ADAPTION AND INNOVATION
i. The efforts made towards technology absorption during the year under review are: -
The Company continues to use the latest technologies for improving the quality of its
services and products.
ii. In case of imported technology - The Companys operations do not require
significant import of technology.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
Foreign Exchange Earnings and Outgo
( in Lakhs)
| Particulars |
2017-18 |
2016-17 |
| Foreign Exchange Earned |
586.62 |
526.19 |
| Foreign Exchange Expenses |
NIL |
NIL |
31. CAUTIONARY STATEMENT
Statement in the Annual Report, particularly those relating to Management Discussion
and Analysis, describing the Companys objectives, projections, estimates and expectation,
may constitute forward looking statement within the meaning of applicable laws and
regulations.
Although the expectations are based on reasonable assumptions, the actual results may
differ.
32. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURTS OR TRIBUNALS
During the financial year under review, there were no significant or material orders
passed by the Regulators or Courts or Tribunal which would impact the going concern status
of the Company and its future operation.
33. MANAGING DIRECTOR & CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION
In terms of Regulation 17(8) of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Company has obtained Compliance Certificate from Managing Director
and Chief Financial Officer.
34. OTHER DISCLOSURES
i. The Company has complied with Secretarial Standards issued by the Institute of
Company Secretaries of India on Meetings of the Board of Directors and General Meetings.
ii. The Company has not issued equity shares with differential rights as to dividend,
voting or otherwise.
35. ACKNOWLEDGEMENTS
The Directors would like to place on record their gratitude for the valuable guidance
and support received from SEBI, Registrar of Companies and other government and regulatory
agencies and to convey their appreciation to shareholders, customers, bankers, lenders,
vendors and all other business associates for the continuous support given by them to the
Company.
The Directors also wish to place on record their appreciation for impressive growth
achieved through the competence, hard work, solidarity, co-operation and support of
employees at all levels.
|
For and on Behalf of the Board |
|
Harshad Thakkar |
|
Chairman and Managing Director |
|
DIN: 01869173 |
| Place: Mumbai |
|
| Date: August 13, 2018 |
|
+91-9892691696
