Eastern Gases Ltd Directors Report.
On behalf of the Board of Directors, it is my privilege and honor to place before you the 22nd Annual Report and the Audited Statement of Accounts of the Company for the year ended 31st March, 2017.
|(Rs. In Lacs)|
|Profit before Interest, Depreciation & Taxation||992.96||1259.48|
|Profit before tax||54.88||447.28|
|Less: Provision for Taxation||41.14||133.20|
|Profit after Tax||55.56||314.08|
|Add: Balance Brought Forward||1381.11||1101.53|
|Surplus carried to Balance Sheet||1921.28||1831.22|
REVIEW OF PERFORMANCE
During the year Profit after tax of the Company amounted to Rs. 55.56 Lacs as compared to Rs. 314.08 Lacs in the previous year. Barring unforeseen circumstances, your Directors expect to achieve good results in the coming years with positive outlook of Gas Industry in India.
With the new government policy PAHAL (DBTL) Scheme it has able to restrict the black marketing of the subsidised LPG and thereby saves Rs 10,000 crores. It has predominantly increased the sale of cylinders at market price and thereby a huge opportunity to the parallel marketers to play. According to Ministry of Petroleum and Natural Gas (MoPNG) demand for non-subsidies cylinders grew 30.82% during this period.
The success of the modified scheme helped fuel parallel marketing companies to gain significance growth in LPG. The Company expects a good growth in this segment as the companies are turning into eco- friendly LPG/CNG/Propane/Butane. The Management has taken adequate steps to cater the future demand for consolidating its position in the market. The new Bottling plants at Bangalore and Hyderabad expect to add good gain to the future prospect of the company. The company is evaluating all the options better utilize its present infrastructure and grow simultaneously without
A. BOTTLING SEGMENT
The company caters the commercial cylinder market of West Bengal, Bihar and Orissa from its own bottling plant situated at Durgapur. The company already set up new LPG bottling plant at strategically potential locations to cover Central and Southern India as well for marketing its "EAST GAS" brand commercial LPG cylinders. Your company has setup two new LPG bottling plants at Bangalore & Hyderabad with its vision of pan India presence. This will add to companys presence in Domestic, Commercial and Industrial segment. With various government checks on Domestic LPG supplies the company expects that the Domestic sector will also open up as New Avenues in years to come.
B. BULK LPG
The Company expects good growth in this segment due to the conversion of major industries from Coal/ other alternate fuels to LPG/Propane due to Environment concerns. LPG being a cleaner and cheaper fuel is preferred choice of the Industrial Customers. The company is also exploring opportunities throughout India as usage of LPG in Industrial houses is growing.
C. AUTO LPG
The Companies own Auto LPG Retail Outlet (ALRO) is already running in Paschim Medinipur, West Bengal and the company expect that Dealer Owner ALRO at Bagnan & Chandannagar in West Bengal would be started by this year.
The Board believes that it will be prudent for the company to conserve resource in view of future expansion programs in line for the company for the coming year, which will enhance the probability to the great extent. Hence your directors are not recommending any dividend for the financial year 2016-17.
The Assets of the Company including building, plant & machinery, etc are adequately insured for all its units.
The Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013, and the rules made there under
The Company has made Preferential Allotment of 11,80,000 Fully Convertible Warrants ("Warrants"), convertible into equivalent number of Equity shares of Rs. 10/-, at an Issue Price of Rs. 58/- each to the person belonging to promoter group and non- promoter group.
As on 31st March, 2017, the issued, subscribed and paid up share capital of the Company was Rs. 15,00,00,000/- comprising 150,00,000 Equity shares of Rs. 10/- each.
MANAGEMENT DISCUSSION AND ANALISIS REPORT
A detailed discussion of the industry structure as well as on the financial and operational performance is contained in the Management Discussion and Analysis Report(Annexure - I)
The Board has duly examined the Statutory Auditors Report to the accounts and clarifications, wherever necessary, have been included in the Notes to the Accounts section of the Annual Report.
CHANGE IN NATURE OF THE BUSINESS
There is no change in the major business activity of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED
There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Companys operations in future.
DETAILS OF HOLDING. SUBSIDIARIES AND ASSOCIATES
The Company does not have any Holding, Subsidiary and Associate Company as on 31st March, 2017.
Our driving objective is to improve living and working condition of our workforce, their dependents and society as well. There has been a constant endeavor to interact with the workers on a day to day basis and promptly resolve the issues that surface up.
Company has obtained all the required certificates and License from Environment Control Regulators to check Safe and Environment friendly Operations. The Company is quite alert in providing clean environment on a continuous basis.
The Company has adequate system for Industrial Safety. In the said year the company has strengthen its fire safety equipment at it units. The year under review continued to be NIL accident year.
BOARD AND COMMITTEE MEETING
During the year, 10 (Ten) Board Meetings were held on 06/04/2016, 29/04/2016, 30/05/2016, 13/08/2016, 03/09/2016, 08/11/2016, 14/11/2016, 02/01/2017, 14/02/2017 and 28/02/2017.
Details of the composition of the Board and its Committees including Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and of the Meetings held and attendances of the Directors at such meetings are provided in the Corporate Governance Report.
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, mandates that the Board shall monitor and review the Board evaluation framework.
The Nomination and Remuneration Committee has defined the evaluation criteria, procedure and time schedule for the performance evaluation process for the Board and its Directors. The Nomination and Remuneration Committee has reviewed the performance of the Board and its Directors.
The functioning of the Board was evaluated on various aspects, inter alia degree of fulfillment of key responsibilities, Board structure and composition, establishment and delineation of responsibilities to various committees, effectiveness of Board processes, information and functioning etc.
In the separate meeting of Independent Directors, a performance of NonIndependent Directors was evaluated on various aspects such as attendance and contribution at Board/ Committee Meetings and guidance/ support to the management outside Board/Committee Meetings. In addition, the Chairperson was evaluated on key aspects including office role, setting the strategic agenda of the Board encouraging active engagements by all Board members and motivating and providing guidance to them.
Areas on which the Committees of the Board were assessed included degree of fulfillment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.
The performance evaluation of the Independent Directors was carried out by the entire Board excluding the Director being evaluated.
The Chairman of the Board provided feedback to the Directors on an individual basis, as appropriate. Significant highlights, learning and action points with respect to the evaluation were presented to the Board.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
The Companys policy on Directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which forms part of the Directors Report.
DIRECTORS & KEY MANAGERIAL PERSONNEL
In accordance with Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Sushil Kumar Bhansali Director of the Company is due to retire by rotation at the ensuing Annual General Meeting and being eligible seeks re-appointment. Your Board recommends his re-appointment.
Ms. Divya Singh was appointed as Company Secretary and Compliance Officer as per Section 203 of the Companies Act 2013 on 6th April, 2016.
Mr. Ranjeet Kochar was appointed as Chief Financial officer as per Section 203 of the Companies Act 2013 on 6th April, 2016.
Mr. Tejvir Singh (DIN: 03539411) and Mr. Anil Choudhary Legha (DIN: 03376753) resigned as Independent Director with effect from 4th July, 2016. The Board places on record its appreciation for the services rendered by Mr. Tejvir Singh and Mr. Anil Choudhary Legha during his tenure with the Company.
Mr. Manish Yadav was appointed as Independent director as per Section 203 of the Companies Act, 2013 with effect from 11th July, 2016.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each independent director under Section 149(7) of the Act, that he/she meets the criteria of independence laid down in Section 149(6) and Regulation 25 of SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.
DIRECTORS RESPONSIBILITY STATEMENTS
Pursuant to Section 134 (5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:
(a) In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and there are no material departures from the same;
(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 March 31, 2017 and the Profit and Loss of the Company for that period;
(c) The Directors have taken proper and sufficient care for 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 Directors have prepared the Annual Accounts of the Company on a going concern basis;
(e) The Directors have laid down Internal Financial Controls to be followed by the Company and such Internal Financial Controls are adequate and were operating effectively;
(f) The Directors have devised proper systems to ensure adequate compliances with provisions of all the applicable laws and that such systems were adequate and operating effectively;
PARTICULARS OF LOANS. GUARANTEE OR INVESTMENTS:
The Company did not give any Loan or Guarantee or provided any security or make investment covered under Section 186 of the Companies Act 2013 during the year. Investments made by the Company are disclosed in the Standalone Financial Statements.
VOLUNTARY DELISTING OF EQUITY SHARES
The Company has applied for delisting of shares from Ahmadabad Stock Exchange Ltd. (ASE) and Jaipur Stock Exchange Ltd. (JSE), for which final delisting approval is yet to be received from the respective SEs.
A separate section on Corporate Governance is included in the Annual Report along with Certificate from the Companys Auditor confirming compliance with condition on Corporate Governance as required by Schedule V of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015. (Annexure-II)
EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) and Section 92(3) of the Act, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return as at 31st March 2017 forms part of this report as Annexure III.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO
A. CONSERVATION OF ENERGY
(a) . Energy conversation measures taken: During the year external experts conducted an energy audit and the recommendations have been implemented.
(b) . Additional investments and proposals, if any, being implemented for reduction of consumption of energy: No additional investments for reduction in energy consumption have been made or are proposed to be made presently.
(c) . Impact of the measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods: the company has achieved marginal savings during 2016-17 due to the measures at (a) above.
B. RESEARCH & DEVLOPMENT (R&D)
No R & D activities have been carried out by the company during the year.
C. TECHNOLOGY ABSORPTION
The Company always keeps a check on global innovation and techniques to avail the latest technology trends and practices. The Company has not imported any technology or process in the financial year.
D. FOREIGN EXCHANGE EARNINGS & OUTGO
The Company had no Foreign Exchange earnings and Outgo during the year under review.
M/s. C B C & Associates., Chartered Accountants, (FRN No. 325794E), Chartered Accountants hold office till the conclusion of the 26th Annual General Meeting of the Company and are eligible for ratification.
QUALIFICATION, RESERVATION OR ADVERSE REMARK IN STATUTORY AUDIT REPORT AND SECRETARIAL AUDIT REPORT
There is no qualification, reservation or adverse remark made by the Statutory Auditors in their Auditors Report to the Financial Statements or by the Secretarial Auditor in its Secretarial Audit Report for the financial year ended March 31, 2017.
The provisions of Sec 148 of the Companies Act, 2013 related to Cost Audit is not applicable to the Company.
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Board of Directors of the Company had appointed Mr. Dilip Kumar Sarawagi, a Company Secretary in Practice to undertake the Secretarial Audit of the Company for the year ended 31st March, 2017. The Secretarial Audit Report is annexed as Annexure-III forming part of this report.
The Board of Directors on the recommendations of the Audit Committee has approved and adopted a Whistle Blower Policy to provide formal Mechanism for all employees of the Company to approach the Chairman of the Audit Committee and make protective disclosure about any unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct.
RISK MANAGEMENT POLICY
The Company has developed and implemented a Risk Management Policy to be followed by the Company, including the identification therein of elements of risk, if any, which in opinion of the Board may threaten the existence of the Company. The risk management framework is based on a clear understanding of various risk, disciplined risk assessment and measurement procedure and continuous monitoring. The policies and procedures established for this purpose are approved. The Board of Directors (BOD) is planning to review the risk management policy and in the present year the BOD is expected to approve new policy.
CORPORATE SOCIAL RESPONSIBILITY
The provision of Section 135 of the Companies Act, 2013 read with Rule 12 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, relating to Corporate Social Responsibility are not applicable to the Company.
INTERNAL FINANCIAL CONTROLS
The Company has designed and implemented the framework for Internal Financial Controls ("IFC") within the meaning of explanation to Section 134 (e) of the Companies Act, 2013.
For the year ended March 2017, the Board believes that the Company has sound IFC commensurate with the nature and size of its business operations; wherein controls are in place and operating effectively and no material weakness exists.
The Company has a process in place to continuously monitor the existing controls and identify gaps, if any, and implement new /improved financial controls.
POLICY ON PREVENTION. PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE
The Company has adopted a policy on prevention, prohibition and redressal of Sexual Harassment at the workplace, to provide protection to employee at the workplace and protection and redressal of complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing safe working environment where employee feel secure. The Company has also constituted an internal complaints committee to consider and to redress complaints of sexual harassment. The Committee has not received any complaint of sexual harassment.
PARTICULARS OF EMPLOYEE
The information required under Section 197(12) of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this report as Annexure IV.
Your Directors like to express their gratitude for the continuous assistance and support received from the Employees, Investors, Customers, Bankers, Registrars and Transfer Agents, SEBI, Exchanges, NSDL, CDSL and other regulatory and government authorities during the year.
Your Directors also like to place on record their deep sense of appreciation and value for the contributions made by every staff member of the Company.
|For EASTERN GASES LIMITED|
|(Sushil Kumar Bhansali)|
|August 28, 2017||DIN: 00344931|