Bright Brothers Ltd Directors Report.
Dear Shareholders (Members),
On behalf of the Board of Directors, it is our pleasure to present the 72nd Annual Report together with the Audited Statement of Accounts of Bright Brothers Limited ("the Company") for the year ended 31st March, 2019.
(Rs in Lakhs)
|Particulars||Year Ended 31st March, 2019||Year Ended 31st March, 2018|
|Net Sales and Operating Income||23,078.64||21,441.70|
|Add: Other Income||41.24||103.15|
|Profit before Depreciation, Finance Cost and Tax||1,408.53||1,240.39|
|Depreciation and amortization expenses||576.75||545.93|
|Profit before tax||210.11||113.27|
|Less: Tax expense||9.80||(7.08)|
|Profit after tax||200.31||120.35|
|Other comprehensive income||(7.59)||10.99|
|Total comprehensive income||192.72||131.34|
Summary of Operations
The total operational income of your company for the year ended 31st March, 2019 stood at Rs 23,078.64 lakhs as against Rs 21,441.70 lakhs in the previous year resulting in an increase of Rs 1,636.94 lakhs as compared to the previous year.
The Operating Profit before Depreciation, Finance Cost and Tax for the year ended 31st March, 2019 amounted to Rs 1,367.29 lakhs as against Rs 1,137.24 lakhs in the previous year.
The Year in Retrospect
During the financial year 2018-19, Indias GDP growth is estimated to be 6.8%. The Indian economy did face a growth risk due to fluctuation in rupee and crude price, demonetisation and disruption in supply chains following the implementation of the Goods and Services Tax (GST). Industrial activity across sectors showed only a marginal improvement as labour-intensive sectors such as textiles, gems and jewellery, leather, etc. continued to struggle throughout the year.
Consumer sentiments remained suppressed for most part of the year with urban consumers feeling the overhang of inadequate job/income growth and high oil prices. At the same time, persistent deflation in food prices and lack of Minimum Support Price (MSP) realisations adversely impacted rural demand. In addition, credit growth was severely affected in the second half of the financial year with the nonbanking financial sector under stress from defaults by a few large players in the sector.
However, this continued volatility will not impact Indias sovereign credit profile as per Moodys analysis; as the rupee-denominated government bonds and robust foreign exchange reserves will help mitigate the risk. Hence, the world is confident of Indias growth potential. The confidence in the Indian economy has increased substantially because of the various policy measures taken by the Government. Indias future growth trend will be driven by structurally positive factors - favourable demographics, structural reforms, increased digitization, focus on development of infrastructure and housing and acceleration of productive job opportunities.
Outlook for the current year
India has emerged as one of the fastest growing major economies in the world and is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships. Numerous foreign companies are setting up their facilities in India on account of various government initiatives like Make in India and Digital India.
Growth in India is expected to stabilise at 7 per cent over the medium term, based on continued implementation of structural and financial sector reforms, easing of infrastructure bottlenecks with efforts to reduce public debt which is essential to secure the economys growth prospects.
Material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year till the date of report
There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 2018-19 and the date of this report. There has been no change in the nature of business of the Company.
Dividend and Reserves
Your Directors are pleased to recommend a dividend of Rs 2 per Equity Share on 56,80,235 Equity Shares of Rs 10 each for the financial year ended 31st March, 2019. The said dividend, if approved by the members, would involve a cash outflow Rs 136.96 lakhs comprising of Rs 113.60 lakhs as dividend and Rs 23.36 lakhs as tax on dividend.
The dividend will be paid subject to the approval of shareholders at the forthcoming Annual General Meeting to those shareholders whose names appear on the Register of Members of the Company as on the specified date.
The paid up Equity Share Capital as on 31st March, 2019 was Rs 567.60 lakhs. During the year, the Company has not issued any shares.
Loans, guarantees or investments
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes accompanying the financial statements.
Your Company has not accepted any deposits from public and its members during the financial year 2018-19. There has been no deposit which was unpaid or unclaimed as at the end of the year. There has not been any default in repayment of deposits or payment of interest thereon during the year. The Company is holding deposits of Rs 263 lakhs from its Directors and Rs 45 lakhs from its members as on 31st March, 2019.
Related party transactions
All transactions entered with related parties for the year under review were on arms length basis and in the ordinary course of business and the provisions of Section 188 of the Companies Act, 2013 are not attracted. Thus, disclosure in AOC-2 is not required. The details of transaction are provided in Note No. 39 of the Notes to Accounts. Further, there are no material related party transactions during the year under review with the Promoters, Directors, and Key Managerial Personnel.
All Related Party Transactions are placed before the Audit Committee as also before the Board for approval. Omnibus approval was obtained for transactions which are repetitive in nature. A statement giving details of all the transactions entered into pursuant to omnibus approval are placed before the Audit Committee and Board for a review.
The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.
All the assets of the Company are fully insured against major risks.
The company has obtained unsecured loan from Smt. Hira Bhojwani, Whole Time Director to meet the short term requirements of the company. The total outstanding loan as on 31st March, 2019 is Rs 460 lakhs.
Internal financial controls
The internal financial controls with reference to the Financial Statements are commensurate with the size and nature of business of the Company. The Company has appointed Internal Auditors who periodically audit the adequacy and effectiveness of the internal controls laid down by the management and suggest improvements. The Audit Committee periodically approves the audit reports, implementation of audit recommendations, if any and adequacy of internal controls. 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, the Board is of the opinion that the Companys internal financial controls were adequate and effective during financial year 2018-19.
Significant and material orders passed by the Regulators
During the year under review, no significant and material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and Companys operations.
Directors Responsibility Statement
Pursuant to the requirement of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, your Directors 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) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
(f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Management Discussion and Analysis
Management Discussion and Analysis of the financial conditions and result of operations of the Company for the period under review as required under Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is given in a separate statement in the Annual Report as Annexure I.
A separate report on Corporate Governance is set out in Annexure II.
Meetings of the Board and its Committees
The details of the Board meetings and various Committee meetings have been mentioned in the Report of Corporate Governance annexed as Annexure II.
Extract of Annual Return
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the annual return in the form of MGT-9 is annexed as Annexure III.
Report of the Statutory Auditors and Notes to Financial Statements
At the 70th Annual General Meeting held on 10th August, 2017, the members had appointed M/s. Desai Saksena & Associates, Chartered Accountants as Statutory Auditors of the Company from the conclusion of the 70th Annual General Meeting till the conclusion of the 75th Annual General Meeting. As per the Companies (Amendment) Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting.
Further, the Report of the Statutory Auditors alongwith notes to Schedules is enclosed to this report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. The observations made in the Auditors Report are self-explanatory and therefore, do not call for any further comments.
As per the requirement of the Central Government and pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company needs to conduct a Cost Audit for the financial year ending on 31st March, 2020.
The Board of Directors, on recommendation of the Audit Committee, has appointed M/s. S. R. Singh & Co., Cost Accountants, as Cost Auditor to audit the cost accounts of the Company for the financial year 2019-20 at a remuneration of Rs 1,50,000/- plus tax as applicable and reimbursement of out of pocket expenses. As required under Companies Act, 2013, a resolution seeking members approval for the remuneration payable to the Cost Auditor forms part of the Notice convening Annual General Meeting.
In terms of Section 204 of the Act and Rules made there under, Ms. Purnima Shetty, Practicing Company Secretary has been appointed Secretarial Auditor of the Company. The report of the Secretarial Auditor for the financial year 2018-19 is enclosed as Annexure IV to this report.
The Report is self-explanatory and does not call for any further comments.
Whistle Blower Policy
Pursuant to the requirement of the Act, the Company has approved its Whistle Blower Policy which is also called as vigil mechanism. It is uploaded on website of the company.
This mechanism enables directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Companys code of conduct or ethics policy.
Risk Management Policy
The Company has developed and implemented the Risk Management Policy.
The Company considers ongoing risk management to be a core component of the management of the Company and understands that the Companys ability to identify and address risk is central to achieving its corporate objectives.
The policy is in compliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 hereinafter referred to as "Listing Regulations" and provisions of the Companies Act, 2013 which requires the Company to lay down procedures about risk assessment and risk minimization.
Directors and Key Managerial Personnel
i. Re-appointment of Smt. Hira Bhojwani, Director who is liable to retire by rotation
Smt. Hira Bhojwani (DIN 00032997), Director of the Company will retire by rotation at the forthcoming Annual General Meeting and being eligible, offers herself for re-appointment.
ii. Re-appointment of Independent Directors of the company
Mr. K. P. Rao (DIN 00027577), Dr. T. S. Sethurathnam (DIN 00042704) and Mr. Byram Jeejeebhoy (DIN 00033204), were appointed as Independent Directors on the Board of the Company at the Annual General Meeting held on 4th September, 2014 for a period of 5 (five) years. They hold office as Independent Directors of the Company up to the conclusion of the ensuing Annual General Meeting of the Company. The Board of Directors, on the basis of the report of performance evaluation of Independent Directors, has recommended re-appointment of Mr. K. P. Rao, Dr. T. S. Sethurathnam and Mr. Byram Jeejeebhoy as Independent Directors for a second term of 5 (five) consecutive years on the Board of the Company subject to approval of the members of the Company in the ensuing Annual General Meeting.
iii. Appointment of Mrs. Devika Bhojwani as Whole-time Director
Mrs. Devika Bhojwani (DIN 08355381) was appointed as Additional Director by the Board of Directors at its meeting held on 13th February, 2019 on the basis of recommendation of Nomination and Remuneration Committee. She is appointed as an Additional Director w.e.f. 1st April, 2019 till the conclusion of this Annual General Meeting. As per the recommendation from the Nomination and Remuneration Committee, the Board of Directors propose to appoint her as Whole-time Director for a period of three years i.e. from 1st October, 2019 to 30th September, 2022 subject to approval of the members of the Company in the ensuing Annual General Meeting.
iv. Appointment of Smt. Hira Bhojwani as Non-executive Director
Smt. Hira Bhojwani (DIN 00032997) was appointed as Whole-time Director by the members of the Company at the Annual General Meeting held on 3rd August, 2016 for a period of three years expiring on 31st March, 2019. The Board of Directors at its meeting held on 13th February, 2019 on the basis of recommendation of Nomination and Remuneration Committee have considered her appointment as a Non-executive Director w.e.f. 1st April, 2019 for a period of three years subject to approval of the members at the ensuing Annual General Meeting.
Declaration by Independent Directors
Mr. K. P. Rao, Dr. T. S. Sethurathnam and Mr. Byram Jeejeebhoy are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in Section 149 of the Act and the Rules made thereunder and Regulations 16(1)(b) of Listing Regulations about their status as Independent Directors of the Company.
There has been no change in the circumstances affecting their status as Independent Directors of the Company. During the year under review, the Independent Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee of the Company.
Companys Policy on Appointment and Remuneration
The objective of Remuneration Policy is to attract, motivate and retain qualified and expert individuals that the Company needs in order to achieve its strategic and operational objectives, whilst acknowledging the societal context around remuneration and recognizing interest of stakeholders.
Formal Annual Evaluation by the Board of its own performance and that of its Committees and individual Directors
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration the various aspects of the Boards functioning, composition of the Board and its Committees. The evaluation process inter alia considers attendance of Directors at Board and Committee meetings, participation at meetings, domain knowledge, cohesion the Boards meetings, awareness and observance of governance, etc.
The Board carried out performance evaluation of the Board, Board committees, individual Directors and Chairperson.
The Company has put in place an induction and familiarization programme for all its directors including the Independent Directors. The familiarization programme for Independent Directors in terms of provisions of Regulation 46(2) of Listing Regulations is uploaded on the website of the company.
Transfer of Unclaimed dividend and underlying shares to Investor Education and Protection Fund (IEPF)
In accordance with the applicable provisions of Companies Act, 2013 read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund ) Rules, 2016 ("IEPF Rules"), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven (7) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven (7) consecutive years or more shall be transferred to the demat account of the IEPF Authority.
Pursuant to the provisions of IEPF Rules, the Company has filed the necessary forms and uploaded the aforesaid details on IEPF website (www.iepf.gov.in).
Compliance with Secretarial Standards issued by the Institute of Company Secretaries of India
The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings.
Particulars of Employees
Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure forming part of the Annual Report.
Having regard to the provisions of Section 136(1) read with its relevant proviso of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours and any member interested in obtaining such information may write to the Company Secretary.
None of the employees of the Company is falling under the criteria as set out in Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 regarding remuneration.
Your Company treats its "human resources" as one of its most important assets.
Your Company is focused on the promotion of talent internally through job rotation and job enlargement.
Prevention, Prohibition and Redressal of Sexual Harassment at Workplace
The Company has formulated a policy on Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. It has also formulated Internal Complaints Committee under the Act. During the year under review, no complaints were filed under the said Act.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
Information given as required under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.
A. Conservation of Energy:
Continuous monitoring and awareness amongst employees has helped to avoid wastage of energy. Various investments in reducing the consumption of energy has helped the Company to reduce the overall power consumption.
Continuous study and analysis for energy conservation, installation of energy efficient equipments has resulted into lower units of power consumption per kg production of finished products. Energy Conservation measures taken:
Installation of Variable Frequency Drives (VFD) to reduce the power consumption of old machines.
Energy efficient pump for cooling tower.
Installation of servo drives in injection moulding machines to reduce power consumption.
Replacement of higher HP motor with lower HP motor.
Replacement of CFL with LED lights.
B. Technology Absorption, Adaptation and Innovation:
C. Foreign Exchange Earnings and Outgo:
Foreign Exchange Earnings: Rs Nil Foreign Exchange Outgo: Rs 85.72 lakhs
Your Directors place on record their appreciation for employees at all levels who have contributed to the growth and performance of your Company.
Your Directors also thank the clients, vendors, bankers, shareholders and advisers of the Company for their continued support.
Your Directors also thank the Central and State Government and other statutory authorities for their continued support.
For and on behalf of the Board,
bright brothers limited
Chairman & Managing Director
|Place : Mumbai||
|Date : 21st May, 2019|