Chordia Food Products Ltd Directors Report.
The Directors have pleasure in presenting the 37th Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31st March, 2019.
1. FINANCIAL RESULTS
The financial results for the year st March, 2019 are briefly given below:-
|Sales & Other Income||61,05,73,907||59,56,61,155|
|Profit before Depreciation &||5,88,74,927||7,16,00,502|
|Profit before exceptional Item||2,86,15,565||3,97,71,697|
|Add: Exceptional Items||-||-|
|Add: Extra Ordinary Item of Income||-||-|
|Profit before Tax||2,86,15,565||3,97,71,697|
|Less: Provision for Taxation||78,61,598||96,70,000|
|Profit after Taxation for the Year||2,07,53,967||3,01,01,697|
2. COMPOSITE SCHEME OF ARRANGEMENT OF AMALGAMATION AND DE- MERGER
As the Members are aware the Scheme of Arrangement under Section 230 to 232 of the Companies Act, 2013 between Chordia Food Park & Properties Limited ( De-merged Company) and Pravin Foods Private Limited (Transferor Company) and the Company i.e. Chordia Food Products Limited (Transferee Company) was sanctioned by Honble National Company Law Tribunal Mumbai Bench vide its Order dated 30th August, 2018 and was filed with Registrar of Companies Maharashtra Pune on 1st September, 2018 which is effective date. The Appointed date for the said Scheme of Arrangement was 1st April, 2016.
Accordingly the Audited Financial Statements for the year ended 31st March 2019 presented for your consideration, as well as the Financial Results for the previous year ended on 31st March, 2018 includes the financialsof the Company, as well as financials of Pravin Foods Private Limited and of the Demerged undertaking of Chordia Food Park & Properties Limited.
As a consequence of the Scheme of Arrangement coming into force:-a) 10,48,152 Equity Shares of Rs. 10/- each were allotted to the then Shareholders of Pravin Foods Private Limited and Chordia Food Park & Properties Limited. Subsequent to the said allotment the paid up Equity Share Capital of the Company stands increased to Rs. 4,02,82,520/-b) The Company had applied to BSE Ltd, for listing of the said shares and BSE Ltd has accorded its listing approval vide letter no DCS/AMAL/JR/1366/2018-19 dated 18th December, 2018 and trading approval vide letter no DCS/AMAL/TP/JR/83152018-19 dated 20th February, 2019.
c) The Business of the Company is divided into two segments viz: Food Division and Food Park- Infrastructure Division.
3. COMPANYS AFFAIRS, PERFORMANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORT
Financial and Present Performance
During the year under review the Revenue from Operations of 31 the Company was Rs. 6105.73 Lakh as against Rs. 5956.61 Lakh of the previous year. The Company has earned a profit of Rs. 207.54 Lakh, after carrying depreciation, interest and tax.
Industry Structure, Development, Opportunities and Outlook
The Company is mainly engaged in the food processing Industry which is showing remarkable growth. The
Governments both Central and State are focusing on development of Preservation of Agro Products and the main thrust is for processing of more and more agro cultivation.
The main revenue of the Company is from Products like Pickles, Ketchups and handmade & machine made Papad.
The Company is diversifying its activities by coming out with some fast and running instant food items which are non-seasonal in nature, which would contribute to the better performance.
Last year the Company has introduced few more unique food items i.e. Date and Tamarind Chutney, Delhi Chat, Green Chutney, Panipuri Chutney, Samosa Chutney, Tamarind Chutney, Bhel Puri Chutney and new advanced variety of ketchups i.e. Pravin Tomato Ketchup, Pravin NONG Ketchup, Pravin Hot & Sweet Ketchup. The said products are highly qualitative and the Market has well accepted the said products.
Details of significant changes, (i.e., change of 25 percent or more, as compared to the immediately previous Financial Year) in key financial ratio, along with detailed explanation thereof: -
|Particulars||Ratio as on 31st March, 2019||Ratio as on 31st March, 2018||% change||Explanations, If any|
|1 Debtors Turnover||4.74||4.40||7.73||Not Applicable|
|2 Inventory Turnover||3.18||2.71||17.34||Not Applicable|
|3 Interest Coverage Ratio||4.01||4.59||(12.64)||Not Applicable|
|4 Current Ratio||4.78||3.82||25.13||Not Applicable|
|5 Debt Equity Ratio||0.20||0.32||(37.50)||Refer Note 1|
|6 Operating Profit Margin (%)||6.25||8.55||(26.90)||Refer Note 2|
|7 Net Profit Margin (%)||3.40||5.06||(32.81)||Refer Note 2|
Details of change in Ratios of Return on Net Worth as compared to the immediately previous Financial Year as follows:
|Particulars||Ratio of Return on Net worth as on 31st March, 2019||Ratio of Return on Net worth as on 31st March, 2018||% change||Explanations, If any|
|1 Return on Net worth||6.13||9.61||(36.21)||Refer Note 3|
1. Debt Equity ratio has decreased on account of repayment during the year.
2. Due to change in product mix and increase in material cost, the material consumption ratio has increased in the current year as compared to the previous year, resulting in a decrease in the operating profit as well as net profit ratio.
3. The decrease in operating profit margin & resulting decrease in net profit margin led to decline in the return on net worth.
4. TRANSFER TO RESERVES
Your Company has not proposed to transfer any amount to the General Reserve. An Amount of Rs. 2,07,53,967/- is proposed to be retained in the Statement of Profit and Loss
To strengthen the long term Capital needs of the Company, the Directors do not recommend any Dividend on the Equity Shares of the Company for the Financial Year ended 31st March 2019.
6. CAUTIONARY STATEMENT
Statements in this Report, particularly those which relate to management discussion and analysis, describing the Companys objectives, projections, estimates and expectations may constitute "forward looking statements" within the meaning of applicable laws and regulations. Actual Results might differ materially from those either expressed or implied.
a) In accordance with provisions of Section 152 of Companies Act, 2013 and regulation 17(A) of SEBI, (Listing Obligations and Disclosure Requirements) Regulations 2015 and in terms of Articles of Association of the Company, Mr. Hukmichand Chordia [DIN: 00389587], retires by rotation at forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment.
b) The term of appointment of Mr. Pradeep Chordia, as the Managing Director is due to expire as on 30th September, 2019.
c) The term of appointment of Mr. Vijaykumar Kankaliya as an Independent Director is due to expire on 30th September, 2019.
d) The term of appointment of Mr. Bapu Gavhane as an Executive Director & CFO expired on 31st March 2019. Necessary resolutions for appointment of Mr. Hukmichand Chordia as Director, Re-appointment of Mr. Pradeep Chordia as the Managing Director and Mr. Bapu Gavhane as Executive Director & CFO for a term of 3 years and appointment of Mr. Vijaykumar Kankaliya as an Independent Director for a further term of 5 years are recommended for your approval.
8. PUBLIC DEPOSITS
During the financial year 2018-2019, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.
The Central Government Ministry of Corporate Affairs vide notification dated 22nd January, 2019 read with further notification dated 30th April,2019 required the Companies to file Return of deposits or Particulars of transactions not considered as Deposit. The Company has complied with the said notification.
9. INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has adequate internal control systems to ensure operational efficiency, accuracy and promptness in financial reporting and compliance of various laws and regulations.
The internal control system is supported by the internal audit process. An Internal Auditor has been appointed for this purpose.
The Audit Committee of the Board reviews the Internal
Audit Report and the adequacy and effectiveness of internal controls periodically.
10. LISTING FEES
The annual listing fees for the financial year 2018-2019 as well as for the financial year 2019-2020 have been paid to
BSE Limited, where your Companys shares are listed.
11. HOLDING COMPANIES, SUBSIDIARY COMPANIES AND ASSOCIATE COMPANIES
As on 31st March, 2019 the Company does not have any Holding Company, Subsidiary Company and Associate Company.
During the current financial year 2019-2020 the Company has acquired 100% stake in Aveer Foods Limited and as such the said Aveer Foods Limited has become 100 % subsidiary company.
12. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT- 9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as Annexure I to this Report.
13. NUMBER OF MEETINGS OF THE BOARD
During the year Eight (8) Board Meetings were convened and held. The meeting of Independent Directors was held on 30th March, 2019. The details of the said Meetings held are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
14. DIRECTORS RESPONSIBILITY STATEMENT
Directors Responsibility Statement prepared pursuant to the provisions of Section 134(5) of the Companies Act, 2013, is furnished below as required under Section 134(3) (c). Directors state that:-
a) In the preparation of the Annual Accounts for the year ended 31st March, 2019 the applicable Accounting Standards have been followed and there were no material departures;
b) Accounting Policies as mentioned in PartB to the Financial Accounts have been selected and applied consistently. Further judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31stMarch, 2019 and of the Profit of the
Company for the year ended on that date;
c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) The Annual Financial Statements have been prepared on a going concern basis; e) Proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; and f) Proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
15. DECLARATION BY INDEPENDENT DIRECTOR
All Independent Directors have given declarations under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence as laid down under Section 149(6)of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
16. AUDITORS AND AUDITORS REPORT a) Internal Auditor:
Mr. Nisarg Shah Chartered Accountant was appointed as on 15th October, 2018 in place of Mr. Shashank Amin, Chartered Accountant, Pune as an Internal Auditor of the Company as per the provisions of Section 138 of the Companies Act, 2013 for a period from 1st September, 2018 to 31st March, 2019.
He has conducted internal audits periodically and submitted his reports to the Audit Committee. His Reports have been reviewed by the Statutory Auditors and the Audit Committee.
b) Statutory Auditor:
Mr. Bharat Shah, Chartered Accountant was appointed as the Companys Statutory Auditor and his term of appointment is valid till the conclusion of 40th Annual General Meeting to be held in the year 2022.
The Auditors Report to the Shareholders for the year under review does not contain any qualification.
No frauds have been reported by the Auditors under Section 143(12) of the Companies Act, 2013 requiring disclosure in Boards Report.
c) Secretarial Audit:
The Secretarial Audit Report is annexed herewith as Annexure II to this Report. The Secretarial Audit
Report does not contain any qualification, reservation or adverse remark.
d) Cost Audit:
For the Financial Year under Report the appointment of Cost Auditor and obtaining of their Report was not applicable to the Company.
17. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
The Details of Loan, Guarantee and Investment under
Section 186 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 are as follows:
a) During the year under report the Company has not advanced any amount in the nature of Loan to any other entity.
b) There are no Guarantees issued by Company in accordance with Section 186 of the Companies Act, 2013 read with Rules issued there under.
c) Details of Investments in Equity Shares made by the Company as on 31st March, 2019 (including Investments made in the previous years) in quoted and unquoted Shares are as under:-
|Name of Entity||Amount as at 31st March, 2019 (Rs.)||Amount as at 31st March, 2018 (Rs.)|
|(a) 1,000 Shares of Rupee Co-op. Bank Ltd. of Rs. 50/- each||50,000/-||50,000/-|
|(b) Vishweshar Sahakari Bank Ltd.||2,13,905/-||2,13,905/-|
18. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED IN SUB SECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013
Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules 2014, the Particulars of contracts of Arrangements entered into by the Company with Related Parties have been done at Arms Length and are in the ordinary course of business and as such the provisions of Section 188 of the Companies
Act, 2013 are not applicable for such transactions.
The Particulars of the transactions so entered in to with Related Parties have been provided in Form No. AOC -2 attached herewith as Annexure III.
19. MATERIAL CHANGES AND COMMITMENTS BETWEEN THE DATE OF THE BALANCE SHEET AND THE DATE OF REPORT AND SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS.
During the current financial year 2019-2020 the Company has acquired 100% stake in Aveer Foods Limited and as such the said Aveer Foods Limited has become 100 % subsidiary company.
There have been no other material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year of the Company to which the Financial Statements relate and the date of this report.
20. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:
A. Conservation of Energy and Technology Absorption:
a) The Companys operations involve very low energy consumption. Wherever possible energy conservation measures have been implemented and there are no further areas where energy conservation measures can be taken. However, efforts to conserve and optimize the use of Energy through improved Operational methods and other means will continue.
b) The Company has no collaborations and is engaged in the manufacture of the products by its own developed methods/operations. The Company has setup a Research and Development Centre whose emphasis is on product development, product quality, Cost reduction, energy conservation and improvement in process productivity. The Company has also setup Laboratory and Quality Control Department to ensure the high standard of quality of different products manufactured.
B. Foreign Exchange Earnings and Outgo:
Foreign Exchange Earnings and outgo during the year was Rs. Nil.
21. RISK MANAGEMENT POLICY
At present the Company has not formulated any Policy for
Risk Management, however during the course of business the Management looks after and study the Business Risks involved.
22. NOMINATION AND REMUNERATION POLICY
The Board has on the recommendation of Nomination and Remuneration Committee framed the policy for selection and appointment of Directors, KMPs and senior Management personnel and their remuneration.
23. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The provisions of Section 135 of the Companies Act, 2013 in respect of CSR activities are not applicable to the Company.
24. BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013, Rules there under and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration and other statutory committees. Performance valuation has been carried out as per the Nomination and Remuneration Policy.
25. CHANGE IN THE NATURE OF BUSINESS, IF ANY.
Consequent upon Scheme of Arrangement coming into force, the Business of the Company is divided into two segments viz: Food Division and Food Park- Infrastructure
26. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR
Directors appointed/ceased during the Year
During the year under report there was no change in Directorship of the Company.
27. COMPOSITION OF AUDIT COMMITTEE
The composition of the Audit Committee has been mentioned in the Corporate Governance Report annexed to this Report.
28. PARTICULARS OF EMPLOYEES
Particulars of Employees and information pursuant to Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is given in Annexure IV.
29. SIGNIFICANT ORDERS PASSED BY REGULATORS, COURTS OR TRIBUNALS IMPACTING GOING CONCERN AND COMPANYS OPERATIONS
During the year under report the Company has received an order of Honble National Company Law Tribunal Mumbai Bench dated 30th August, 2018 for the approval of Scheme of Arrangement between Chordia Food Park & Properties Limited ( De-merged Company) and Pravin Foods Private Limited ( Transferor Company) and Chordia Food Products Limited (Transferee Company) and their respective shareholders under Section 230 to 232 of the Companies Act, 2013.
Except that the Company has not received any orders from any regulator, court & tribunals.
30. CASH FLOW
A Cash Flow Statement for the year ended 31stMarch, 2019 is attached to the Financial Statement.
31. CORPORATE GOVERNANCE
The Company conforms to the norms of Corporate Governance as envisaged in the Listing Regulations with the BSE Limited. Pursuant to Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Report on the Corporate Governance on Corporate Governance are and the Auditors Certificate annexed to this report.
32. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
During the year under review, there were no cases occurred pursuant to the aforesaid Act.
33. SECRETARIAL STANDARDS:
During the year under review the Company has complied with all applicable mandatory Secretarial Standards issued by Institute of Company Secretaries of India, and approved by the Central Government u/s 118(10) of the Companies Act, 2013.
Your Directors wish to place on record their sincere appreciation of the continued support from the Companys Bankers viz. Corporation Bank, valued Customers, Distributors, Suppliers of the Company.
The Directors are also thankful to the officials of the Government of India, State Governments, Local Authorities for their continued help and timely assistance extended to the Company.
|By Order of the Board of Directors|
|For Chordia Food Products Limited|
|Place: - Pune||Hukmichand S. Chordia|
|Date: 13th August, 2019||Chairman|