Cupid Ltd Directors Report.
The Board of Directors is pleased to present herewith the 26th Annual Report of your Company together with the Audited financial statements for the year ended 31st March, 2019. The Management Discussion and Analysis has been annexed to the Directors Report.
The highlights of financial results of the company are as follows: -
|(Rs In lacs)|
|Particulars||For the financial year 2019 (FY19)||For the financial year 2018 (FY18)|
|Operating Revenues / Turnover||8,793.81||8,178.21|
|Profit before Depreciation & Amortization, Finance charges||2,303.52||2,832.81|
|Depreciation & Amortization||201.45||217.85|
|Profit / (Loss) before tax||2,091.34||2,609.24|
|Provision for taxation (incl. deferred tax)||570.43||900.22|
|Profit / (Loss) after tax||1,520.91||1,709.02|
During the year under review, the Company registered slight improvement in operating revenues from Rs 8,178.21 lac in FY18 to Rs 8,793.81 lac in FY19. The revenue of the Company was impacted due to continuing slowdown in female condom orders from South Africa. Moreover, margins were impacted due to higher share of low margin male condom in overall sales, one-time inventory write-off and business development expenses. In the total operating revenues, the male condoms contributed about 59% in value terms as against 40% for the female condoms and water based lubricant jelly contributed around 1% as well. From the margins standpoint, our EBITDA margins stood at 27% in FY19. On an absolute basis, EBITDA decreased by 19% from Rs 2,832.81 lac in FY18 to Rs 2,303.52 lac in FY19. At the net profit level, we closed this financial year with a net profit of Rs 1,520.91 lac as against Rs1,709.02 lac in the previous year which is a decrease of 11%.
Your Board of Directors had declared 1st interim dividend of Re. 1 (i. e. 10%) per equity share at their meeting held on 6th November, 2018. Further, Board also recommended final dividend of Rs 3 (i.e. 30%) per equity share for FY 2018-19 at their meeting held on 29th May, 2019 which is subject to approval of shareholders in the ensuing AGM. Hence, during the year, the Company will pay a total dividend of Rs4.00 (i.e. 40%) per equity share if the final dividend will approved by shareholders.
The whole of profit after tax has been transferred to Profit & Loss account. Interim Dividends are paid and Final Dividend provision along with Dividend Distribution Taxes are adjusted in the Profit & Loss account. There is no other amount that has been proposed to be carried to any other reserves.
CHANGE IN NATURE OF BUSINESS
The Company manufactures Male and Female Rubber Contraceptives and Lubricant Jelly. There is no any change in the business carried on by the company during the year under review.
The paid up Equity Share Capital as at 31st March, 2019 is Rs 1,333.80 Lac (Thirteen Crores Thirty Three Lacs and Eighty Thousand Only). During the year under review, the Company has issued bonus shares in the ratio of 1:5. As on 31st March 2019, none of the Directors of the Company hold instruments convertible into equity shares of the Company.
FINANCE AND ACCOUNTS
Your Company prepares its financial statements in compliances with the requirements of the Companies Act, 2013 and the Indian Accounting Standard (IND AS). The financial statements have been prepared on historical cost basis. The estimates and judgments relating to the financial statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Companys state of affairs, profits and Cash Flows for the year ended 31st March, 2019. There is no audit qualification in financial statements by the statutory auditors for the year under review.
LOANS, GUARANTEES & INVESTMENTS
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to Financial Statements.
The Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, or under Chapter V of the Act.
RELATED PARTY TRANSACTIONS
The Company has not entered into any contracts or arrangements with related parties referred to in Section 188 of the Companies Act, 2013 and providing the information in the prescribed Form AOC-2 are not applicable to the Company. There are no transactions with related parties except those indicated in notes to accounts.
INTERNAL CONTROL SYSTEMS
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. It ensures that strict confidentiality is maintained whilst dealing with concerns and also no discrimination will be meted out to any person for a genuinely raised concern. Any suspected or confirmed incident of fraud / misconduct can be reported thereof.
The Whistle Blower Policy has been posted on website of the Company at below link:-http://www.cupidlimited.com/wp-content/uploads/2017/04/05ti002tiCGtiWhistlerblower.pdf
There is a continuous process for identifying, evaluating and managing significant risks faced through a risk management process designed to identify the key risks facing business. During the year a risk analysis and assessment was conducted and no major risks were noticed.
PERFORMANCE EVALUATION OF BOARD
Pursuant to the provisions of the Companies Act, 2013 and Securities and Exchange Board of India (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 & Remuneration and other Committees. The same is found to be satisfactory.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
At the time of appointing a Director, a formal letter of appointment is given to him, which inter alia explains the role, function, duties and responsibilities expected of him as a Director of the Company. The Director is also explained in detail the Compliance required from him under the Companies Act, 2013, Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other relevant regulations and affirmation taken with respect to the same.
Further the Company has put in place a system to familiarize the Independent Directors about the Company, its products, business and the on-going events relating to the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mrs. Veena Garg, Director of the Company, retires by rotation at the ensuing Annual General Meeting of the Company, and being eligible offers herself for re-appointment.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The following are the Key Managerial Personnel of the company:
Mr. Omprakash Garg: - Chairman and Managing Director
Mr. Saurabh V. Karmase: - Company Secretary and Compliance Officer
M. Joshi: - Chief Financial Officer
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report on the operations of the Company, as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in a separate section and forms an integral part of this Report.
During the year under review, the Company has conducted 7 Board Meetings on the following dates: 14th May, 2018; 13th August, 2018; 24th August, 2018; 13th October, 2018; 6th November, 2018; 22nd January, 2019 and 18th March, 2019. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Stakeholders Relationship Committee
4. Corporate Social Responsibility Committee
The details of the Committees along with their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report.
M/s. Chaturvedi Sohan & Co., Chartered Accountants, Mumbai was appointed as Statutory Auditors of the company at 24th Annual General Meeting which was held on 7th September, 2017 to hold the office as Statutory Auditor from the conclusion of 24th Annual General Meeting till conclusion of 29th Annual General Meeting of the company subject to ratification by the members of the company at every Annual General Meeting. M/s. Chaturvedi Sohan & Co. is willing to act as a Statutory Auditor of the company for the financial year 2019-20. The company has received a written consent from them vide letter dated 29th May, 2019 for their reappointment and also confirmation from the said auditors that they are not disqualified to act as the auditors and are eligible to hold the office as Statutory Auditors of the company.
Further, as per the Companies (Amendment) Act, 2017, the provision of ratification by the members at every Annual General Meeting has been deleted w.e.f. 7th May, 2018. Accordingly there is no need to ratify their appointment in the ensuing Annual General Meeting of the company.
As required under Section 204 of the Companies Act, 2013, Secretarial Audit Report as obtained from Mr. Shailesh Kachalia, Practising Company Secretary is annexed as "annexure 1" and forms part of the Board Report.
OBSERVATIONS AUDITOR & SECRETARIAL AUDITOR
There are no qualifications contained in the Auditors Report. The observation made in Secretarial Audit Report regarding continuation of appointment of Mr. J. L. Sharma in current term is self-explanatory.
EXTRACT OF ANNUAL RETURN
The extract of Annual Return in Form No. MGT-9, as provided under Section 92 of the Companies Act, 2013, is annexed as "annexure 2" and forms part of the Board Report.
MATERIAL CHANGES AND COMMITMENTS
There are no material changes having taken place affecting the financial position of the Company from the date of closure of financial year till the signing of Accounts.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators / courts / Tribunals that would impact the going concern status of the Company and its future operations.
ENVIRONMENT AND SAFETY
The Company is conscious 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.
DISCLOSURE IN TERMS OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company took all necessary measures to ensure a harassment free workplace and has instituted an Internal Complaints Committee for redressal of complaints and to prevent sexual harassment. No complaints relating to sexual harassment were received during the year.
As per Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Report on Corporate Governance practices followed by the Company, together with a certificate from the Auditors of the Company confirming compliances forms integral part of this Report.
DIRECTORS RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3) (c) of the Companies Act, 2013:
a. that in the preparation of the annual financial statements for the year ended 31st March, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. that such accounting policies as mentioned in the Notes to the Financial Statements have been selected and applied consistently and judgement 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 31st March, 2019 and of the profit of the Company for the year ended on that date;
c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;
f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
CONSERVATION OF ENERGY, RESEARCH & DEVELOPMENT, TECHNOLOGY ABSORPTION
A) Conservation of Energy:-
i. The Company has taken all effective steps to conserve the energy by installing latest equipments for conservation of energy. As a stand-by arrangement in case of no supply of electricity, the Company has installed generator set.
ii. The cumulative effect of the Energy conversations steps taken by the Company has considerably reduced the consumption of Energy and saved the cost.
iii. The Company is not required to mention per unit consumption of Energy in "form A". B & C) Technology Absorption and Expenditure on Research & Development:-
The Company has deployed indigenous technology to manufacture its products. The Company is also taking steps to upgrade its technology to improve the quality of its product so as to make same cost effective and compete in international market
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company has earned foreign exchange of Rs 8065.46 Lacs (Previous year Rs 3476.70 Lacs) through exports, whereas the Company paid / payable foreign exchange of Rs 80.68 Lacs (Previous Year Rs 85.31 Lacs) towards machinery / equipments. Further payments made in foreign exchange of Rs 414.44 Lacs (Previous Year Rs 49.67 Lacs) towards other expenses.
CORPORATE SOCIAL RESPONSIBILITY
In terms of the provisions of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors of your Company has constituted a Corporate Social Responsibility ("CSR") Committee which is chaired by Mr. Pradeep Kumar Jain, Independent Director of the Company, the other members of the committee are Mr. Omprakash Garg, Chairman and Managing Director and Mr. Jandhyala L. Sharma, Independent Director. Your Company also has in place a CSR policy and the same is available on the website of the Company at http://www.cupidlimited.com/wp-content/uploads/2017/04/05ti001tiCGti01CSR-Policy.pdf. A detailed report as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as "Annexure 3" forming part of this report.
The Audit Committee now headed by Shri. Pradeep Kumar Jain as Chairman of the committee. Shri. Omprakash Garg and Shri. Jandhyala L. Sharma are Members. The details of all related party transactions, if any, are placed periodically before the Audit Committee. During the year there were no instances where the Board had not accepted the recommendations of the Audit Committee.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee is headed by Shri. Pradeep Kumar Jain as Chairman of the committee. Shri. Jandhyala L. Sharma and Mrs. Veena Garg are the members of committee. During the year there were no instances where the Board had not accepted the recommendations of the Nomination and Remuneration Committee.
STAKEHOLDER RELATIONSHIP COMMITTEE
The Stakeholder Relationship Committee is headed by Shri. Pradeep Kumar Jain as Chairman of the committee. Mr. Omprakash Garg and Mrs. Veena Garg are the members of committee. During the year there were no instances where the Board had not accepted the recommendations of the Stakeholder Relationship Committee.
PERFORMANCE EVALUATION CRITERIA FOR INDEPENDENT DIRECTORS:
Pursuant to the provisions of the Companies Act, 2013 and regulation 17 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the performance evaluation of the Independent Directors is carried out by other non-independent directors on the basis of their contribution towards important aspects of the company and active participation on the board. The Directors express their satisfaction with the evaluation process. Further, the company have constituted Performance Evaluation Policy to evaluate the performance of Independent Directors and the said policy is available on the website of the company at http://www.cupidlimited.com/wp-content/uploads/2017/04/ PerformancetiEvaluation.pdf
REMUNERATION OF DIRECTORS
Pecuniary Relationship or Transactions with the Non-Executive Directors:
There was no any pecuniary relationship or transaction took place between the company and its non-executive directors.
Criteria of making payments to non-executive directors:
Company is paying the sitting fees to all the non-executive directors as decided by the board for attending the board meetings and various committee meetings. Further, Company reimburses out of pocket expenses incurred by all the non-executive directors of the Company in connection with various affairs of the company.
PARTICULARS OF EMPLOYEE
The disclosure required under section 197 of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as "Annexure 4".
The statement of particulars of employees pursuant to Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Annual Report and attached as "Annexure 5".
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
The Company takes pride in the competence, dedication and commitment of its employees in all sectors of the business. The Company has a structured training and management development programs to upgrade skills of employees of the company. Objective appraisal systems are in place for senior management staff.
The Company is committed to enhancing and retaining its top talent through superior learning and organizational development. This is a part of our Human Resource function and is an essential pillar to support the organizations growth and its sustainability in the long run.
The company is strongly giving emphasis on maintaining its current industrial relations and developing the new ones.
As per the Companies (cost records and audit) Rules, 2014 and the amendments made thereof notified by Ministry of Corporate Affairs, cost audit is not applicable to the company. Therefore the board did not proceed with the appointment of cost auditor and cost audit for the year 2019-20. The company is properly maintaining its cost record internally.
SUBSIDIARY/JOINT VENTURE/ASSOCIATE COMPANIES
Company doesnt have any Subsidiaries or Joint Ventures or Associate companies as on the report date as defined under the Companies Act, 2013 and hence providing the information in the prescribed Form AOC-1 is not applicable to the Company.
Except for the historical information contained herein, statements in this report and the subsequent discussions, which include words or phrases such as "will", "aim", "will likely result", "would", "believe", "may", "expect", "will continue", "anticipate", "estimate", "intend", "plan", "contemplate", seek to", "future", "objective", "goal", "likely", "project", "should", "potential", "will pursue", and similar expressions of such expressions may constitute "forward-looking statements", These forward looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. Important factors that could make a difference to the Companys operations include global and domestic demand supply conditions. Finished goods prices, raw materials cost and availability fluctuations in exchange rates, change in Government regulations and tax structure within India and the countries of which the Company has business contacts and other factors such as litigation and industrial relations.
These risks and uncertainties include, but are not limited to our ability to successfully implement Companys strategy, growth and expansion plans, obtain regulatory approvals, provisioning policies, technological changes, investment and business income, cash flow projections, exposure to market risks as well as other hazards. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date thereof.
Your Directors would like to express their grateful appreciation for the contribution made by the employees at all levels. Your Directors are also deeply grateful for the confidence and faith shown by the Shareholders of the Company in them. Your Directors also wish to thank its customers, dealers, agents, suppliers and bankers for their continued support and faith reposed in the Company.
|For and on behalf of the Board of Directors|
|CIN No. : L25193MH1993PLC070846|
|Email: firstname.lastname@example.org||Ompraksh Garg|
|Chairman & Managing Director|
|REGISTERED OFFICE||DIN: 00140756|
|A - 68, M. I. D. C. (Malegaon), Sinnar, Nashik,|
|Date: 27th August, 2019|