Today's Top Gainer
Note:Top Gainer - Nifty 50 More
Your Directors are pleased to present the 34th Annual Report of the Company together with its Audited Financial Statements for the year ended 31st March, 2018.
1. FINANCIAL AND OPERATIONAL RESULTS: A. Financial Results (Standalone):
Financial and Operational Results of the Company for the Financial Year ended 31st March, 2018 as compared to the previous financial year, is summarized as hereinbelow :
|(Rs. In Lakhs)|
|Particulars||Current Financial Year ended on 31.03.2018||Previous Financial Year ended on 31.03.2017|
|Gross Sales/ Income from Operations||1,20,455.38||70,408.67|
|Total Operational Revenue||1,05,883.13||70,408.67|
|Less: (i) Finance Cost||773.89||979.56|
|(ii) Depreciation and Amortization||607.03||541.93|
|Profit Before Tax (PBT)||15,431.48||5,673.56|
|Provision for tax (including Deferred Tax)||5,467.55||2,110.52|
|Profit from Continuing Operations after Tax (PAT)||9,963.93||3,563.03|
|Other Comprehensive Income||(-)22.40||(-)56.10|
|Total Comprehensive Income for the Year||9,941.53||3,506.93|
|Amount Transferred to Reserves||NIL||NIL|
|E.P.S (Equity Share of Rs. One each) 6.01 2.15|
B. Financial Results(Consolidated):
The Consolidated Financial and Operational Results of the Company for the year ended 31st March, 2018 as compared to the previous financial year, is summarized as hereinbelow:
|(Rs. In Lakhs)|
|Particulars||Current Financial Year ended on 31.03.2018||Previous Financial Year ended on 31.03.2017|
|Gross Sales/ Income from Operations||1,20,455.38||70,408.67|
|Total Operational Revenue||1,05,883.13||70,408.67|
|Profit Before Tax (PBT)||15,431.48||5,673.57|
|Add- Share of Net Profit of Joint Venture Company accounted for using the equity method||38.73||(-)17.74|
|Consolidated Profit Before Tax (PBT)||15,470.21||5,655.83|
|Provision for tax (including Deferred Tax)||5,467.55||2,110.53|
|Profit from Continuing Operations after Tax (PAT)||10,002.66||3,545.29|
|Other Comprehensive Income||(-)22.40||(-)56.10|
|Total Comprehensive Income for the Year||9,980.26||3,489.19|
|Amount Transferred to Reserves||NIL||NIL|
|E.P.S (Equity Share of Rs. One each)||6.03||2.14|
C. OPERATIONS AND FUTURE PLAN: OPERATIONS:
(a) The results achieved in the year 2017-18 depict profound improvement over the previous year as was envisaged and as may be observed from the relevant texts reproduced hereunder:
Extract from the Boards Report of Fiscal 2017:
"Ipso facto, improving upon the results achieved in 2016-17, is likely to be far more impressive in the F.Y. 2017-18 and definitely thereafter in the subsequent years".
(b) Indeed the company could achieve stunning performance in the fiscal 2018, as is evident from the following results:
Sales Volume: Sales volume increased from 50,732 MT (2016-17) to 66,016 MT (2017-18) - an increase of 30.12%.
Sales Turnover: Sales turnover of goods manufactured increased from Rs. 619.33 Crores (2016-17) to Rs. 922.13 Crores (2017-18) - an increase of 48.89%.
EBITDA: Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) increased from Rs.71.95 Crores (2016-17) to Rs.168.12 Crores (2017-18) - an increase of 133.66%.
PBT: Profit Before Tax increased from Rs. 56.73 Crores (2016-17) to Rs. 154.31 Crores (2017-18) - an increase of 172.01%. (includes trading profit).
PAT: Profit After Tax increased from Rs. 35.63 Crores (2016-17) to Rs. 99.64 Crores (2017-18) - an increase of 179.65%.
EPS: Earning per Share increased from Rs. 2.15 (2016-17) to Rs. 6.01 (2017-18) - an increase of 179.53%.
Return on Net Worth: Return on Net Worth increased from 21.55% (2016-17) to 38.51% (2017-18)
Return on Investment: Return on Investment increased from 8.25% (2016-17) to 22.86% (2017-18)
(c) The aforesaid magnificent results could be produced owing to the business approach adopted by your company to reorient its marketing strategy by positioning its products in highly remunerative ABS consuming segments. As a result of the aforesaid business approach adopted by your company, the Economic Value Addition (EVA i.e. Sales RevenueCost of Material) at Rs. 287.64 Crores (2017-18) shows an enhancement of Rs. 128.34 Crores against the previous years EVA at Rs. 153.50 Crores- an increase of 87.38%.
(d) Simultaneously, expenditure was kept under tight leash resulting in maintaining the level of expense in the year under review at Rs. 20,900 per unit volume of sales excluding debtors write-off at Rs. 8.56 Crores-Rotomac Group and Forex loss of Rs.6.82 Crores in the last quarter of fiscal 2018. This is against previous years level of expense at Rs. 20,700 per unit volume of sales. It is noteworthy due to prevailing inflationary condition in the Indian economy.
(e) The stakeholders of the company will be delighted to observe the Balance Sheet as at 31.03.2018 on account of the following facts:
Net Worth: Net worth of the company is Rs. 258.13 Crores in the year under review against the previous year at Rs. 162.71 Crores - an increase by 58.64%.
Book Value of the Equity share: The corresponding increase in the book value of the equity share of the company (with the Face Value of Rs. 1/- per share) is at Rs. 15.56 in the year under review against the previous year at Rs. 9.81 - an equated increase by 58.61%.
Current Ratio: Current Ratio (Current Assets/Current Liabilities) as on 31.03.2018 is 2.04 against 1.30 as on 31.03.2017.
TOL/TON: Financial health gained in the year under review resulted in highly favourable ratio of Total Liability to Total Net worth at 0.63 against previous years ratio of 1.59
Zero Debt: The company has been debt free (long term debt) ever since fiscal 2003 and now it has become a zero debt company, i.e. no borrowing at all. This is in view of the fact that the company has repaid all its dues to its working capital solitary banker Allahabad Bank, who had lent fund and non-fund based working capital facility to the company amounting to Rs. 216.50 Crores. Consequent thereupon, Allahabad Bank has vacated their charge on the entire fixed and movable assets of the company, which was created through equitable mortgage and Deed of Hypothecation. Consequently, the shares pledged by the Promoter and Promoter Group Companies in favour of Allahabad Bank and the personal guarantee of Mr. B. M. Bhansali, Promoter and Managing Director have been released.
Financing Pattern: Without resorting to any external borrowing the company would be able to sustain its operations based on the handsome internal accruals.
Sales Credit Control: Companys sales credit control policy in respect of the supply effected to the esteemed patrons has also shown good effect, since debtors percentage of sales has reduced to 15.39% as on 31.03.2018 against 19.42% as on 31.03.2017. Consequent whereupon, the debtors age has reduced from 80 days to 60 days. (f) As aforesaid, continuance of the sales credit control policy and handsome internal accruals will not only provide sufficient liquidity to the company but would also enable it to largely fund its long term CAPEX requirement in respect of its ensuing capacity augmentation program, details whereof have been adequately dealt with in the later text captioned as "Future Expansion".
A) Expansion from 80 KTPA to 137 KTPA:
a) In the text of Boards Report of fiscal 2017, we had highlighted the expansion program to ramp up the ABS capacity to 137 KTPA by 31.12.2018. This program is being implemented in two phases i.e 80 KTPA to 100 KTPA by 31.03.2018 and thereafter from 100 KTPA to 137 KTPA by 31.12.2018. The company has already communicated to BSE/NSE vide letter dtd. 4th April, 2018 that the ABS capacity expansion plan of the company from 80 KTPA to 100 KTPA at its Abu Road unit has been successfully implemented within the envisaged cost and time frame, i.e. Rs. 20 crores and 31st March, 2018 respectively.
b) Furthermore, concerted efforts are being directed to expand ABS compounding capacity to 137 KTPA within the envisaged time and cost schedule i.e. Rs. 30 crores and 31st December, 2018 respectively.
c) The R&D Centre at Aburoad unit being set up at an estimated cost of Rs. 20 Crores will be operational by 30th September, 2018. This will revitalize the market development efforts as the R&D Centre is being equipped with state-of-the-art recipe development and testing facilities, viz. recipe development:- Lab Extruders (2 nos.), Moulding machines (3 nos.), Digital Microscope, Fourier Transform Infra-Red Spectrophotometer and Colour Spectrophotometer, etc. Testing facilities:- Weather Meter, Gas Chromatograph, Charpy Impact Tester, HDT Tester, MFR Tester, Universal Testing Machine and DuPont Impact Tester etc.
d) Since company has established a JV with Nippon A&L (NAL), Japan 5 years ago and their process and R & D experts are head quartered in India for extending full support to BEPL, the new R&D Centre will function under technical guidance of these Japanese experts and if required, additional manpower will be deployed by NAL to back up BEPLs R & D efforts under the technical assistance agreement executed between BEPL and NAL.
e) Therefore, R&D Centre at Aburoad unit will enable BEPL to gradually increase the market share of speciality ABS grades and through niche marketing efforts, BEPL will concentrate on highly remunerative ABS market segment by decreasing sale of General Purpose (GP) grades and increasing sale of speciality grades.
B) Port Based Greenfield Project of 200 KTPA capacity:
a) As was covered in the text of Board Report of fiscal 2017 dealing with the subject of future expansion, we are pleased to inform that after in-depth evaluation of alternative ports in Gujarat, Pipavav port has been selected as a location to set up the proposed port based green-field project of 200 KTPA capacity. In this connection, two alternative land parcels have been identified at Pipavav port and due diligence in respect of the first choice of land parcel is being presently carried out and hopefully will be completed by 15th May, 2018. This land parcel is available for disposal by a scheduled private bank. The other alternative land parcel is available with Govt. of Gujarat. The first land parcel is located within 3.3 kms. from the APM Terminals liquid jetty and the other land parcel referred to herein above is located at 6.5 kms. from the APM Terminals liquid jetty.
b) From the technical feasibility angle in terms of transporting liquid cargo of Styrene, Acrylonitrile monomers and liquified Butadiene monomer through pipeline, both the land parcels are selectable.
c) The proposed new plant will be based on state-of-the-art technology as has been amply covered in the text of Board Report of Fiscal 2017 and in view of the relevance and validity thereof, the appropriate text is being reproduced hereinbelow:
Extract from the appropriate text of the Board Report - Fiscal 2017:
The new plant will be based on the state of the art technology from Japan and in this connection, the substantive initial steps have already been taken involving several round of meetings with the Japanese company followed by visit of their experts. This Japanese company is none-else than Nippon A&L, Japan with whom the company has a long standing relationship and also established marketing joint venture in the year 2013 who are providing sales support as well as technical support with respect to the existing operations of JV products.
Furthermore infrastructure development work is progressing rapidly in terms of steps being taken by your Company for acquisition of land and planning of captive power plant as an integral part of the expansion programme. Based on the encouragement being received from the concerned authorities of the state government and companys technology partner, the implementation programme has been firmed up to commence manufacturing of ABS from the proposed port based green-field plant by 31st March, 2022.
Perception backed up by conviction of the Company is that by the time, the new 200 KTPA port based plant is established; the company will be able to exploit its capacity of the plant optimally. This is because your Company is likely to have captured the largest market share of ABS in India. Moreover, based on the competitive cost structure and quality wise at par with the best in the world, if required, your company will be in a position to export specialty grades of the ABS, ASA and AES resins as well.
The aforesaid strategy will ensure birth of a healthy baby, thwarting all threats and limitations which is often faced by any greenfield project as it is otherwise difficult to maintain the economic viability in the initial years of production due to relatively lower capacity utilization resulting in not being able to achieve breakeven level of the output which certainly will not be the situation to be faced by your company.
Moreover, implementation of the project takes into account, in terms of the technology selection and logistic planning that it remains globally competitive in the event the Indian economy opens up further and custom tariff barriers is done away with.
In this context, energy conservation and minimizing environmental affects are given due impetus. Furthermore automation and safety measures are no less area of attention for implementing the project based on ultramodern process technology. Due care is being taken to ensure that the material handling system is carried out with least human involvement to improve upon the safety and avoid human errors.
2. REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES:
Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, your Company did not have any subsidiary Company during F.Y. 2017-18; however it has one Joint Venture/ Associate Company viz. Bhansali Nippon A&L Private Limited having its Registered Office at 401, 4th Floor, Peninsula Heights,C. D. Barfiwala Road, Andheri (West),Mumbai - 400 058, wherein the Company holds 50% of the paid up equity share capital.
The Report on the performance and Statement containing salient feature of Financial Statements of aforesaid Joint Venture / Associate Company is separately attached in Form No. AOC-1 with this Annual Report. In accordance with Section 136 of the Companies Act, 2013 the Financial Statements of the Company including the Consolidated Financial Statements pertaining to its aforesaid Joint Venture entity are available on the Companys website (www.bhansaliabs.com).
Your Directors, considering stupendous growth in total comprehensive income viz. by 183.48 % during F.Y. 2017-18 as against the last fiscal, have recommended final dividend @ 30% on the nominal value of the total paid-up equity share capital of Company consisting of 16,59,05,640 equity shares with the face value of Rs. 1/- each (viz. dividend of Thirty paise per equity share) for the financial year ended 31st March, 2018 which is an increase of 50% in the dividend rate(s) declared by the Company for last fiscal. The aforesaid dividend, if approved by members in ensuing Annual General Meeting, will be distributed out of the net profits of the Company available for distribution of dividends.
4. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report for the year under review, as required pursuant to the provisions of Regulation 34(2)(e) read with Schedule V(B) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is annexed herewith vide Annexure - I and forms an integral part of this Report.
5. BUSINESS RESPONSIBILITY REPORT:
Pursuant to regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, top 500 listed companies by market capitalization, calculated as on March 31 of every financial year, are required to include in their Annual Report a Business Responsibility Report, describing therein the initiatives taken by them from environmental, social and governance perspectives, in the format prescribed by SEBI. Since the company, for very first time from its inception, entered into the category of top 500 Listed companies of India by way of its market capitalization for the financial year ended 31-03-2018, it has presented its Business Responsibility Report. In its quest of green initiative, the Company has hosted the Business Responsibility Report on its website - www.bhansaliabs.com. On request, a physical copy of said Report would be made available.
6. DIVIDEND DISTRIBUTION POLICY:
The Dividend Distribution Policy became applicable to the company pursuant to Regulation 43(A)(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; because for very first time since inception, it entered into the category of top 500 Listed companies of India by way of its market capitalization for the financial year ended 31-03-2018. Therefore the Company has formulated its Dividend Distribution Policy considering the parameters as mandated in the said Listing Regulations and is available on the website of the company viz. www.bhansaliabs.com
7. INTERNAL FINANCIAL CONTROL SYSTEM OF THE COMPANY:
Adequate Internal Financial Control systems, commensurate with the nature of the Companys business, size and complexity of its operations, are in place and have been operating satisfactorily and effectively. During the year, no material weaknesses in the design or operation of Internal Financial Control system was reported.
8. PARTICULARS OF CONTRACT(S)/TRANSACTION(S)/ARRANGEMENT(S) WITH RELATED PARTIES:
The Related Party Contract(s)/Transaction(s)/Arrangement(s) entered into by the Company during F.Y. 2017-18, were in its ordinary course of business and on an arms length basis. Hence Form AOC-2 is not applicable to the Company. Further pursuant to the provisions of regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, there were no materially significant related party contract(s)/ transaction(s)/arrangements entered into by the Company with the Related Party(ies) which may have a potential conflict with the interest of the Company. All related party transaction(s) are first placed before Audit Committee for their consideration and making recommendation to the Board and thereafter such transactions are placed before the Board for seeking their approval, wherever required.
The details of Related Party Transactions (RPTs,) in consonance with the provisions of the respective Accounting Standards, have been stated in Note No. 39 to the Standalone Audited Financial Statements of Company forming part of this Annual Report.
The Policy of Company on dealing with the Related Party Transactions has been placed on the Companys website and can be accessed at www.bhansaliabs.com.
9. PARTICULARS OF LOANS, ADVANCES & GUARANTEES GIVEN AND INVESTMENTS MADE OR SECURITIES PROVIDED AS PER SECTION 186 OF THE COMPANIES ACT, 2013:
Particulars of Loans, Advances and Investments made by the Company during the financial year 2017-18 are stated in Note No. 5 and 6 to Standalone Audited Financial Statements of Company as annexed to this Annual Report. The Company has neither made any investment nor provided any guarantee or security for any loan during the reporting period.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMPs):
There was no change in the KMPs and composition of the Board of Directors during the reporting period. However, the Board has recommended for the re-appointment of Mr Jayesh B. Bhansali (DIN: 01062853) as Executive Director & CFO of the Company for further period of 3 years w.e.f. 1st April, 2018 on the existing remuneration, terms & conditions, considering the recommendation made by the Nomination and Remuneration Committee of the Company at their meeting held on 10th March, 2018. Necessary information including the applicable terms and conditions and the proposed remuneration has been provided in the said Resolution and the explanatory statement thereof forming part of the Notice convening the AGM.
Mr. B. M. Bhansali (DIN: 00102930), Managing Director of the Company shall retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.
a. DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received declaration from all the Independent Directors of Company confirming that they meet with the criteria of Independence as prescribed pursuant to the provisions of Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
b. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Company has formulated a Programme for Familiarization of Independent Directors with regard to their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, the business model of the Company etc. The details of the Familiarization Programmes as conducted by the Company last time are available on the website of the Company (www.bhansaliabs.com). However during the year under review, there was no change in the nature of business of the company and its business vertical/ structure/ operational strategy, etc. which would have necessitated a fresh Familiarization Programme for Independent Directors. Further with respect to the compliances of various acts and regulations applicable to the Company, the familiarisation programme is held at the Board Meeting(s), whenever required.
11. DISCLOSURES RELATED TO BOARD AND CORPORATE GOVERNANCE REPORT ETC:
a. NUMBER OF MEETINGS OF THE BOARD:
The Board met 4 (Four) times during financial year 2017-18 viz. 16th April 2017; 14th July 2017; 13th October 2017 and 14th January 2018. The detailed information with regard to the Composition of Board and its Committee(s) and their respective meetings etc. are stated in the Corporate Governance Report of Company, for sake of brevity, which forms part of this Annual Report.
b. CORPORATE GOVERNANCE:
The Company is committed to maintain the highest standards of Corporate Governance and adheres to its requisites as set out by the respective authorities. The report on Corporate Governance as stipulated under Regulation 34 read with Schedule V(C) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed herewith vide Annexure II and forms an integral part of this Annual Report.
The requisite certificate from the Practising Company Secretary viz. Secretarial Auditors of the Company, M/s Rathi & Associates, confirming compliance with the conditions of Corporate Governance as stipulated in Part E of Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended herewith vide Annexure II A and forms an integral part of this Annual Report.
Certificate issued by the Managing Director and Executive Director Cum CFO of the Company with regard to the certification on Audited Financial Statements of the Company for financial year 2017-18 is also annexed herewith vide Annexure II B and forms an integral part of this Annual Report.
The Company has suitably laid down the Code of Conduct for all Board Members and Senior Management personnel of the Company in accordance with the provisions of Regulation 17(5) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the said Code is also available on the website of the Company (www. bhansaliabs.com). The declaration by CEO i.e. Managing Director of Company related to the compliance of aforesaid Code of Conduct is also attached herewith vide Annexure II C and forms an integral part of this Annual Report.
12. COMPANY POLICIES:
In accordance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013, the Company has formulated and implemented the following policies. All the Policies are available on Companys website (www.bhansaliabs.com) under the caption (Investors) and its sub-caption (Policies and Procedures) The policies are reviewed periodically by the Board and are updated based on need and requirements arising from time to time.
|Name of the Policy||Brief Description|
|Whistle Blower or Vigil Mechanism Policy||The Policy is meant for Directors, Stakeholders and Employees etc. of the Company to report their concerns, if any, about unethical behavior, actual or suspected fraud or violation of the Companys code of conduct and ethics.|
|Policy for Related Party Transactions||The Policy regulates all transactions taking place between the Company and its related parties in accordance with the applicable provisions.|
|Policy for Preservation of Documents||The Policy deals with the system of retention of Corporate records of the Company.|
|Policy for Determination of Materiality of Events||The Policy applies for determining and disclosures of material events taking place in the Company from time to time.|
|Archival Policy||The Policy deals with the retention and archival of corporate records of the Company for a particular period, as may be applicable on basis of its policy.|
|Code of Conduct for Director(s) and Senior Management Personnel||The Policy is aimed to formulate a Code of Conduct for the Directors and Senior Management Personnel of Company to establish highest standard of their ethical, moral and legal conduct in the business affairs.|
|Nomination and Remuneration Policy||The Policy formulates the criteria for determining qualifications/ competencies/ positive attributes and independence for the appointment of Director (Executive / Non-Executive) and also the criteria for determining the remuneration of the Directors, Key Managerial Personnel (KMPs) and other employees covered under the prescribed criteria, if any.|
|Corporate Social Responsibility Policy||The Policy outlines the Companys strategy to bring about a positive impact on society through its activities/ programmes relating to Health, Education, Social welfare activities, Hunger eradication, Environmental Sustainability, Promoting Gender Equality, Upliftment of deserving deprived and underprivileged sections of society and Promotion of Sports, Arts & Culture etc.|
|Code of Conduct for Prohibition of Insider Trading||The Policy provides framework for dealing with the securities of Company by the Insiders of Company in mandated manner.|
|Code for Independent Directors||The Code is a guide to professional conduct for Independent Directors. Adherence to these standards by Independent Directors and fulfillment of their responsibilities in a professional and faithful manner will promote confidence of the investing community, particularly minority shareholders, regulators and companies in the institution of Independent Directors.|
|Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI)||Regulation 8 of the SEBI (Prohibition of Insider Trading) Regulations 2015 requires a listed company to formulate and publish a policy on its official website viz. "Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information" which shall adhere to each of the principles as set out in schedule A to the said Regulation.|
|Policies related to Business Responsibility Report (BRR) :||In compliance with Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the company being one of the top five hundred listed companies as on 31.03.2018, the Nine polices related|
|1) Ethics, Transparency and Accountability||to BRR have been formulated by the management.|
|2) Product Life Cycle Sustainability|
|3) Employee Well being||The key objective of these policies is to re-affirm the Companys commitment to follow the principles laid down in National Voluntary Guidelines (NVGs) on Social, Environmental and Economic perspectives/responsibilities of Businesses. These policies will help the company to deal with the complexities and challenges that keep emerging in the conduct of its business.|
|4) Stakeholders Engagement|
|5) Human Rights|
|7) Policy Advocacy|
|8) Inclusive Growth and Equitable Development|
|9) Consumer Value|
|10) Dividend Distribution Policy||In compliance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, The Dividend Distribution Policy of Company has been formulated by the management.|
13. CORPORATE SOCIAL RESPONSIBILITY (CSR):
The Company is conscious of its responsibility towards the society as a corporate citizen. During the F.Y. 2017-18, the Company was required to spend a total amount of Rs. 58.64 Lakh towards its CSR activities which has been entirely spent within the F.Y. 2017-18 itself towards Educational/Skill development programmes/social welfare activities for general public/ creating permanent infrastructure pertinent thereto/training programmes and promotion of Education, Art and Culture etc.
The Companys CSR Policy Statement and Annual Report on the CSR activates undertaken during the financial year ended 31st March, 2018, in accordance with Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) is annexed herewith vide Annexure III and forms an integral part of this Report.
14. COMMITTEES OF THE BOARD OF DIRECTORS:
The details with respect to the Committees of Board of Directors of Company viz. Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Investment and Loan Committee for the sake of brevity have been stated in the Corporate Governance Report of the Company forming integral part of this Annual Report.
15. PERFORMANCE EVALUATION OF THE BOARD AND ITS COMMITTEE(S):
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 (10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable provisions thereto; the Board carried out annual evaluation of each of the directors of the Company individually (considering the various relevant aspects of the functioning of the Board including their composition and adequacy etc.), culture, execution, performance, obligations, governance, contribution and quality of participation in the Board and committee proceedings etc. The Committees of Board were also evaluated by the Board of Directors and their functionings were found satisfactory.
The Performance evaluation of the Independent Directors was done by the entire Board of Directors sans the participation of the Director being evaluated. The performance evaluation of the Chairman, Managing Director & Executive Director was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.
16. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Pursuant to the provisions of Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the requisite details are annexed herewith vide Annexure IV and forms an integral part of this Report and are also available at the Registered Office of the Company for inspection during its business hours upto the date of AGM and any member interested in obtaining such information may directly write to the Company Secretary of the Company and the same shall be provided on such request.
17. ADOPTION OF INDIAN ACCOUNTING STANDARDS (Ind AS)
The Company has adopted Ind AS with effect from 1st April 2017 with a transition date of 1st April, 2016 pursuant to the Ministry of Corporate Affairs notification no. G.S.R. 111(E) dated 16th February, 2015, notifying the Companies (Indian Accounting Standards) Rules, 2015.
Accordingly, the financial statements for the year ended 31st March, 2018 have been prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015 prescribed under section 133 of the Companies Act, 2013, and other recognized accounting practices and policies to the extent applicable thereto.
18. AUDITORS AND THEIR REPORTS:
The matters related to Auditors and their Reports are as under: a. STATUTORY AUDITOR:
At the 33rd AGM of the Company held on 15-07-2017, M/s Azad Jain & Company, Chartered Accountants, Mumbai (FRN-006251C) were appointed its Statutory Auditor for a period of 5 years pursuant to the provisions of section 139 of the Companies Act, 2013, subject to ratification of their re-appointment in each ensuing AGM. As per the respective provisions in force, their re-appointment is within the prescribed limit and they are also not disqualified under section 141 of the Companies Act, 2013.
Further pursuant to the provisions of sections 142 of the Companies Act, 2013, the proposal is put up for approval of members to authorize Board of Directors of the Company to fix their remuneration for F.Y. 2018-19. In accordance with the requirement of SEBI (LODR), Regulations, 2015, the Auditors have also confirmed that they hold valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
No frauds have been reported by the Statutory Auditors during F.Y. 2017-18 pursuant to the provisions of section 143(12) of the Companies Act, 2013.
In view of above, necessary resolution for ratification of appointment of the said Auditor has been included in the notice of AGM for seeking approval of members.
b. AUDIT REPORT:
The observations made by the Statutory Auditor in their Audit Report read with the relevant notes thereof as stated in the Notes to the Audited Financial Statements of the Company for the Financial Year ended 31st March, 2018 are self explanatory and being devoid of any reservation(s), qualification(s) or adverse remark(s) etc do not call for any further information(s)/ explanation(s) or comments from the Board under Section 134(3)(f)(i) of the Companies Act, 2013.
c. SECRETARIAL AUDITORS:
In terms of the provisions of Section 204 of the Companies Act, 2013, M/s Rathi and Associates, Practicing Company Secretaries, Mumbai have been re-appointed by the Board as Secretarial Auditors of Company for the F.Y. 2018-19.
d. SECRETARIAL AUDIT REPORT:
Secretarial Audit Report as issued by the Secretarial Auditors, in Form No. MR-3 for F.Y. 2017-18 is annexed herewith vide Annexure V and forms integral part of this Report. The said Secretarial Audit Report being devoid of any reservation(s), adverse remark(s) and qualification(s) etc. does not call for any further explanation(s)/ information or comment(s) from the Board under Section 134(3) (f)(ii) of the Companies Act, 2013.
e. COST AUDITORS:
Pursuant to the provisions of Section 148 and other applicable provisions, if any, of the Companies Act, 2013, the Board has approved the re-appointment of M/s Joshi Apte & Associates, Cost Accountants, Pune (Firm Registration No. 000240) as Cost Auditors of the Company for carrying out its cost audit for F.Y. 2018-19 for an Annual Audit Fee/ Remuneration of Rs. 75,000/- (Seventy Five Thousand only ) plus applicable Government Taxes thereon and reimbursement of travelling and actual out of pocket expenses incurred in relation to performance of their duties.
Necessary resolution for ratification of remuneration payable to the Cost Auditors is included in the Notice of ensuing AGM for seeking approval of members.
19. COMPLIANCE OF SECRETARIAL STANDARDS:
All the requirements related to Secretarial Standards as applicable to Company from time to time have been complied with accordingly.
20. CHANGE IN SITUATION OF THE REGISTERED OFFICE OF THE COMPANY:
The Registered office of the Company was shifted from Bhansali House A - 5, Off Veera Desai Road, Andheri (West), Mumbai 400053 to 401, 4th Floor, Peninsula Heights, C. D. Barfiwala Road, Andheri (West), Mumbai 400058 w.e.f. 20th April, 2017.
21. OTHER DISCLOSURES:
Other disclosures as per provisions of Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are furnished as hereunder:-a. EXTRACT OF ANNUAL RETURN:
Pursuant to the provisions of Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, the extract of Annual Return of the Company in Form MGT-9 is annexed herewith vide Annexure VI and forms an integral part of this Report.
b. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars as required pursuant to the provisions of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are annexed herewith vide Annexure VII and forms integral part of this Report.
22. GENERAL DISCLOSURES:
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions/ activities pertaining to these matters during F.Y. 2017-18:
a. Details relating to deposits covered under Chapter V of the Companies Act, 2013. b. Issue of equity shares with differential rights as to dividend, voting or otherwise. c. Issue of shares (including sweat equity shares and ESOP) to employees of the Company under any scheme. d. Instances with respect to voting rights not exercised directly by the employees of Company.
Your Directors further state that during F.Y. 2017-18:-
i Neither the Managing Director nor the Executive Director cum CFO of the Company receive any remuneration or commission from any other company. ii No significant or material orders were passed by the Regulators or Courts or Tribunals which can impact the going concern status and the Companys operations in future. iii There has been no change in the nature of business of the Company. iv Pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, no case pertaining to sexual harassment at workplace has been reported to the Company. v There was no revision of the Financial Statements of the Company. vi No fraud has been reported by the Auditors in their Audit Report hence the disclosure u/s 134(3) (ca) is not applicable. vii The Company has not identified any such risk which can potentially threaten its existence.
23. DIRECTORS RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act, 2013 ("the Act"), and in relation to the Audited Annual Financial Statements of the Company for the year ended 31st March, 2018, the Board of Directors hereby confirm that:
a. in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures; b. such accounting policies have been selected and applied consistently and the Directors have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the profit of the Company for that year; c. proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. the annual accounts of the Company have been prepared on a going concern basis; e. Internal Financial Controls have been laid down to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and f. Proper systems have been devised to ensure compliance with the provisions of laws applicable to the Company and that such systems were adequate and operating effectively.
24. ACKNOWLEDGEMENT AND APPRECIATION:
Your Directors would like to place on record their appreciation for the assistance, coordination and cooperation received from the Banks, Government, Statutory Authorities, Customers, Vendors and all Stakeholders of the Company, who extended their constant patronage and support to the Company in its endeavour of consistent growth.
Your Directors would like to express their deep-appreciation to the employees for their resilience, hard work, dedication, sincerity and relentless efforts which contributed to the stupendous growth and impressive performance of the Company during F. Y. 2017-18.
|For and on Behalf of the Board of Directors|
|M. C. Gupta|
|Place : Mumbai|
|Date :13th April, 2018|
|Registered Office Address:|
|401, 4th Floor, Peninsula Heights,|
|C D Barfiwala Road,|
|Andheri (West), Mumbai-400058.|
|Tel No. : 022 - 2621 6060|
|Fax No. : 022 - 2621 6077|
Annexure - IV
PART - A: DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.
(i) The percentage increase in remuneration of each Director, Chief Financial Officer (CFO) and Company Secretary during the financial year 2017-18, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2017-18 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:
|SN||Name of Director/ KMP and Designation||Remuneration of Director(s)/ KMPs for the Financial Year 2017-18 (in Rs.)||% increase in the Remuneration in the Financial year 2017-18||Ratio of remuneration of each Director to median remuneration of the employees|
|1.||Mr. B. M. Bhansali (Managing Director)||77,148,599.00||176.10%||347.38|
|2.||Mr. Jayesh B. Bhansali (Executive Director & CFO)||77,148,599.00||1185.81%||347.38|
|3.||Mr. M. C. Gupta (Chairman & Independent Director)||3,00,000.00||62.16%||1.35|
|4.||Dr. B. S. Bhesania (Independent Director)||3,60,000.00||44.00%||1.62|
|5.||Mr. Dilip Kumar (Independent Director)||1,50,000.00||15.38%||0.68|
|6.||Ms. Jasmine F. Batliwalla (Independent Director)||1,40,000.00||21.74%||0.63|
|7.||Mr. D. N. Mishra [G.M. (Legal) & Company Secretary]||3,980,492.20||2.41%||17.92|
1. The remuneration of Directors includes sitting fees paid to them for the financial year 2017-18.
2. The percentage increase in Independent Directors remuneration is based on their attendance in the Board and Committee Meetings held during the financial year.
(ii) The median remuneration of employees of the Company (including KMPs) during the financial year 2017-18 was Rs. 2,22,090/-per annum;
(iii) In the financial year 2017-18, there was decrease of (6.92%) in the median remuneration of employees (including KMPs) due to reduction in the number of employees as compared with last fiscal;
(iv) There were 456 permanent employees on the rolls of Company as on 31st March, 2018;
(v) Average percentage increase made in the salaries of employees other than the managerial personnel in the last financial year i.e. 2017-18 was 11.98% whereas the increase in the Key Managerial Personnel Remuneration for the same fiscal was 313.56 % considering the outstanding performance as well as Key Responsibility Areas (KRAs) of the KMPs, the increase in the remuneration of KMPs is considered appropriate.
(vi) It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company pertaining to its Directors and Key Managerial Personnel (KMPs).
PART - B: PARTICULARS OF EMPLOYEES AS PER SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH RULE 5(2) OF THE COMPANIES
(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.
a) Disclosure of Top Ten Employees of Company in terms of remuneration drawn and the Employees employed throughout the Financial Year and in receipt of remuneration of Rs. 102 Lakhs or more per annum or Rs. 8.5 Lakhs per Month for part of the year.
|S. No.||Name of Employee||Designation||Remuneration in Fiscal 2018 (In Rs.)||Nature of Employment (Contractual or otherwise)||Qualification/ Experience||Date of Commencement of Employment||Age||Last Employment before joining the Company||% of Equity Share held in Company as on 31.03.2018||Whether employee is relative of any Director / Manager and if so, name of such Director/ Manager|
|1||BABULAL M. BHANSALI||Managing Director||77,148,599.00||Regular||Non-Matriculate (34 Years)||08-09-84||64||Bhansali Engineering Polymers Ltd||16384887||Father of Executive Director Cum CFO of Company viz. Mr. Jayesh B. Bhansali|
|2||JAYESH B. BHANSALI||Executive Director Cum CFO||77,148,599.00||Regular||M.Com (11 Years)||24-06-06||34||Bhansali Engineering Polymers Ltd||11561945||Son of Managing Director of Company viz. Mr. Babulal M. Bhansali|
|3||KENJI ASAKAWA||E.D. (Technical)||6,000,000.00||Contractual||B.E. and M.E. (Chemical Engineering) (46 Years)||06-11-03||72||Nippon A & L INC. Japan||NIL||NO|
|4||JUNG REA CHO||Vice President - Marketing||4,139,966.83||Regular||B.E Metallurgy, MBA (15 Years)||04-09-17||41||Crenova Plating Pvt. Ltd||NIL||NO|
|5||DEOKI NANDAN MISHRA||GM(Legal)& Company Secretary||3,980,492.20||Regular||FCS, ACIS (U.K.), LL.B., MBA (Finance), PGD (IPR) (30 Years)||07-05-11||50||Sahara One Media and Entertainment Ltd||14725||NO|
|6||MANOJ KUMAR SHARMA||General Manager (Marketing)||3,610,682.00||Regular||B. Tech (Plastics) (27 Year)||21-12-11||50||LG Polymers India Pvt. Ltd.||NIL||NO|
|7||S M GHIKE||G M (Projects)||3,492,329.00||Regular||B.E. (Mechanical), D.M.S. (42 Years)||15-02-16||64||ThyssenKrupp Industrial Solutions (India) Pvt. Ltd.||NIL||NO|
|8||VINEET BANSAL||Manager - Electrical||2,604,389.00||Regular||M.E (Electrical System and Drive) (16 Years)||10-01-17||43||SKI Carbon Black Pvt Ltd. , Aditya Birla Group Company||108||NO|
|9||ARUN KINGAWADEKAR||Dy. Manager (Marketing)||2,223,915.50||Regular||B.A.,D.P.A.T. (28 Years)||01-08-94||49||Shalimar Paints Ltd||NIL||NO|
|10||MINESH VINODKUMAR KANOJIA||Manager - Instrumentation||2,025,066.00||Regular||B.E. (Instrumentation & Control) (16 Years)||22-02-17||39||Pidilite Industries||NIL||NO|
b) None of the employee was in receipt of remuneration amounting to Rs. 8.5 Lakhs per month or more for part of the year.
c) There were no Employee employed throughout the financial year or part thereof, who was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, was in excess of that drawn by the Managing Director or Whole Time Director or Manager and who holds by himself or along with his spouse and dependent children, two percent or more of the equity shares of the company.
|Place: Mumbai||For and on behalf of the Board|
|Date: 13th April, 2018||M. C. Gupta|
DISCLOSURE PURSUANT TO SECTION 134(3) (m) OF THE COMPANIES ACT, 2013 READ WITH RULE 8 OF THE
COMPANIES (ACCOUNTS), RULES 2014
(A) Conservation of Energy:
|Steps taken or impact on conservation of energy||1. In powder plant, 5 No of reciprocated air compressors are replaced with 2No screw compressors with VFD facilities.|
|2. In powder plant, total 134KW of high capacity motors are controlled by VFD instead of throttling valves or dampers.|
|3.In powder plant, total 57 No of tube type street lights are replaced with LED lamp.|
|4. In powder plant, by improved maintenance of steam trap and condensate recovery system more condensate is recovered in boiler system. So steam consumption rate is reduced by 81Kg/MT-powder. This means 16 kg of coal consumption per MT powder is reduced.|
|5.In powder plant, in the area where middle pressure steam is not required, low pressure steam is supplied by erecting new pressure reducing system. By this modification steam leakage and passing trouble becomes almost nil.|
|6.In SAN & compound plant, 5 No of reciprocated air compressors are replaced with 2No of screw compressors with VFD facilities which saves 25KW.|
|7.In SAN & Comp plant, total 363 No of tube lamps are replaced with LED lamps which can save 5.3 KW.|
|Steps taken by the company for utilizing alternate resources of energy||NA|
|Capital investment on energy conservation equipment||Rs. 50 Lacs (Approx)|
|(B) Technology absorption:|
|Efforts made towards technology absorption||NA|
|1.Benefits derived like product improvement, Cost reduction, product development or import substitution||By various power saving activities power consumption is reduced by 36KHW/MT-powder.|
|2. Sub-raw material loading to powder is reduced by process improvement. This resulted in saving of Rs.1500/MT-powder.|
|3. By increased SAN output capacity, fuel consumption at hot oil heater is reduced by 3Kg/MT-SAN.|
|In case of imported technology (imported during the last three NA years reckoned from beginning of the financial year):|
|Details of technology imported||NA|
|Year of import||NA|
|Whether the technology has been fully absorbed||NA|
|If not fully absorbed, areas where absorption has not taken NA place, and the reasons thereof Expenditure incurred on Research and Development NA|
|Actual Foreign Exchange Earnings & outgo during F.Y. 2017-2018 (in INR)|
|Foreign Exchange earning||: Rs. NIL|
|Foreign Exchange Outgo||: Rs. 410.18 Lacs|