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Your Directors are pleased to present the 27th Annual Report along with the audited financial statements of your Company for the financial year ended on 31st March 2019.
FINANCIAL PERFORMANCE SUMMARY
Pursuant to notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards ("IND AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 prescribed under Section 133 of the Companies Act, 2013 (as amended from time to time) with effect from 1st April, 2016 and the accounts are prepared under IND AS.
The summary of the financial performance for the year is given below:
Rs. in lacs
|Revenue from operations||17,140.47||17,638.96|
|Profit Before Tax||1,789.68||1,330.26|
|- Current Tax||365.80||506.00|
|- Deferred Tax||49.48||-6.15|
|Profit After Tax||1,374.40||830.41|
|Other Comprehensive income (net of tax)||179.06||-175.21|
|Total Comprehensive Income for the period / year||1,553.47||655.20|
|Earning Per Equity Share (EPS) for the period (Face Value of Rs.10)|
During the year under review total revenue of your Company decreased by 2.82 %, from Rs. 17639 lacs to Rs. 17140 lacs. The profit after tax for the year stood at Rs. 1374.40 Lacs against Rs. 830.41 lacs in the previous year.
Further to strengthening our fruit processing business, the Company has started commercial production of cold extracts juices, which includes maximum nutrition and taste that exists at a farm to doorstep at Mumbai, Gurgaon, Bangalore, Hyderabad, Pune and Nasik.
FRESH FRUITS SEGMENT:
Grape production and export from India were started from 1991 with an initiation of economic liberalization. The major grape producing countries are China, France, and Italy. The crop ranks fifth in India on the basis of agricultural productivity. In India it is covering an area almost 123 thousand hectares occupying 2.01 % of the total area.
Indian grapes come in varied characteristics namely colored, white, seeded, seedless, large and small berries.
Major grape-growing states are Maharashtra, Karnataka, Telangana, Andhra Pradesh, Tamil Nadu, and the northwestern region covering Punjab, Haryana, western Uttar Pradesh, Rajasthan and Madhya Pradesh. Maharashta ranks first in terms of production accounting for more than 81.22 % of total grape production.
The demand for consumption of grapes has been increased in last few decades due to increase in the wineries business and facilitates such as cold storage, cold chain transport, packaging, drip irrigation systems, facilities for exporters etc.
There is a phenomenal rise in export of grapes from India, Indias grape exports rose from 92,286 tonnes in 2017-18 to 1,21,469 tonnes in 2018-19. The countrys top exporting destinations for grapes are Netherlands, Russia, UK and Germany.
According to data by APEDA, Indias grape exports to Europe rose by 31% in 2018-19 and has to reach Rs. 1,900 crore.
Pomegranate is grown in tropical and subtropical regions of the world. India is the worlds leading Pomegranate growing country with about 1.81 lakh hectares of area.
Pomegranate is one of the esteemed table fruits. The fruit is known for their sweetness and fine blend of acidity. pomegranate known as a "super fruit" due to its high nutritional value and health benefits.
India is the largest producer of pomegranates in the world. Maharashtra is the largest pomegranate-growing state in the country, with a coverage of over five lakh acres.
As pomegranate arils are ready-to-eat form would be convenient with desirable alternative to the consumption of fresh fruits. The demand for pomegranate arils is increasing in domestic as well as international markets, because of high economic importance, healthiness, changing food consumption and their desirable characteristics as compared to whole pomegranate fruit.
Mango is the most important fruit of India and is known as "King of fruits". The fruit is cultivated in the largest area i.e. 2,312 thousand hactor. Uttar Pradesh tops the list of mangos producing states followed by Andhra Pradesh, Maharashtra, Karnataka, Bihar and Gujarat.
Mango is protector against heart disease, cancer and cholesterol build up. In addition, this luscious fruit is a warehouse of potassium, beta- carotene and antioxidants.
Mango Pulp is prepared from selected varieties of Fresh Mango. Mango Pulp/Concentrate is perfectly suited for conversion to juices, nectars, drinks, jams, fruit cheese and various other kinds of beverages. However, in recent years the popularity of mango has spread to the western markets with consumers showing interest in the taste.
India accounts for contributing approximately 67 percent of the total world export when it comes to processed mango product. The country has exported 1,05,873.21 MT of Mango Pulp to the world for the worth of Rs. 657.66 crores / 93.95 USD Millions during the year 2018-19.
FOOD PROCESSING SEGMENT
Food processing industry is of enormous significance for Indias development because of the vital linkages and synergies it promotes between the two pillars of our economy, industry and agriculture. It has also play important role for linking Indian farmers to consumers in the domestic and international markets.
The key sub-segments of the Food Processing industry in India are: Dairy, Fruits & Vegetables, Poultry & Meat processing, Fisheries, Food retail etc. During the last one decade due to easy availability of raw materials, changing lifestyles and relaxation in policies that has given a substantial momentum to the industrys development.
India is blessed with diverse agro-climatic conditions, which are conducive to the cultivation of different fruits and vegetables almost round the year, India is the 2nd largest producer of fruits and vegetables in Asia.
After 25 years of supplying fresh fruits to supermarkets in Europe, Japan and North America, Freshtrop has moved into cold-extracted beverages in 2018 the company comes with a new brand," SECOND NATURE".
"SECOND NATURE" means Second-To-Tree, these three words adequately summarize about to we are tries to provide the same as the same nutrition and taste out of most fruits is when you pluck them from the tree and have them. We believe, the second best is our way and hence we come up with Second Nature brand which is a range of 100% Cold Extracted Fruit juices, Fruit & Veggie blends, Fruit nectars and Dairy-Free Nut Milks.
The Board of Directors of your Company, after considering holistically the relevant circumstances and keeping in view the companys dividend distribution policy, has decided that it would be prudent, not to recommend any Dividend for the year under review.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 149 of the Act, which came into effect from April 1, 2014, Mr. Mayur Shah, Mr. Dinesh Oza, and Mr. Anil Sharma were appointed as independent directors at the Annual General Meeting of the Company held on September 22, 2014. The terms and conditions of appointment of independent directors are as per Schedule IV of the Companies Act, 2013. Your Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and the SEBI Listing Regulations and there has been no change in the circumstances which may affect their status as independent director during the year.
The following changes have been made to the Board of Directors & Key Managerial Personnel of the Company during the year:
|S. No.||Name||Designation||Appointment or Resignation||Appointment Date or Resignation Date|
|1||Mr. Jignesh Gandhi||Company Secretary||Resignation||07/01/2019|
|2||Mr. Ronak Dhruve||Company Secretary||Appointment||07/01/2019|
Brief details of Directors proposed to be appointed / re-appointed as required under Regulation 36 of the SEBI Listing Regulation are provided in the Notice of Annual General Meeting.
DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, state the following:
a) That in the preparation of the annual financial statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b) that such accounting policies 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 control were adequate and were operating effectively;
f) that proper systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
The assets of the Company are adequately insured against the loss of fire and other risks which are considered necessary by the management.
INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY:
The details in respect of internal financial control and their adequacy are included in Management Discussion and Analysis Report which forms part of this report.
During the year under review, your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 read with rules made there under.
COMPLIANCE OF APPLICABLE SECRETARIAL STANDARDS:
The Company has complied with applicable Secretarial Standards during the year under review.
During the year under review, the Company has obtained the following certifications pertaining to the Highest International Standard of Food Safety and Hygiene:
1. ISO 22000- ISO 22000 is international standard developed by the International Organization for Standardization dealing with food safety, it is systematic and proactive approach to identification of food safety hazards, development and implementation of control measures.
2. SGF International E.V. - This certifies participation of the Company voluntary self-control safe guide in the fruit juice segment for enhancing customer and consumer safety.
3. SEDEX (Supplier Ethical Data Exchange): - SEDEX is worlds largest collaborative platforms for sharing responsible sourcing data on supply chains, the company is member of SEDEX.
4. Halal Certificate - Halal Products are" universal" products not only suitable for Muslims consumption, it is ensuring the safety of nations food supply and we acquired this certificate to export our products in Islamic Countries.
5. Kosher Certificate - This certificate provides certification for ingredients, packaged foods, beverages, and certain materials, as well as food-service providers and facilities in which kosher food is prepared or served. This certification provides certificate as per standards set in Jewish dietary law. kosher symbol boosts market share, that a kosher product can win more favourable shelf space, and that positioned next to a competing non-kosher brand. This certificate helps in increasing the salability of the product in the international supermarkets.
6. BRC certificate: the BRC certificate for Food Safety as requirements of the EU General Product Safety, the BRC certificate is for Nashik (Unit I) Pack house and Sangli (Unit II) Pack house.
7. FDA: The Food and Drug Administration ensuring the safety of food supply in US Market.
8. APEDA Pack House: The APEDA Recognition for pack house will be granted for multiple produce for which appropriate facilities and procedural compliances as per the importing countries. APEDA Pack house has Recognition for Nashik (Unit I) and Sangli (Unit II) as Pack house.
9. Global GAP Certificate - it is a voluntary set worldwide standard for agriculture producer for adoption of safe and sustainable practices.
10. Walmart Supply Chain Security: is the accumulation of controls throughout the supply chain process that enhance the security of the supply chain during the transportation of finished, we follow the same for Unit I and Unit II.
11. Fairtrade certificate- Fair trade is an alternative approach to conventional trade based on a partnership between producers and traders, businesses and consumers.
12. FSSAI License: Food Safety and Standards Authority of India, is the food regulatory body of India, The FSSAI registration becomes mandatory in order to ensure safe, and smooth operations of the food business. FSSAI food license helps the government, as well as the consumers, feel assured that the regulation of the storage, production, distribution and the sales has been carried out in a way that the food products are fit for consumption. FSSAI License is for Nasik (Unit I) Pack house and Sangli (Unit II) Pack house and Nashik processing unit (Unit IV).
13. Amfori BSCI - The amfori BSCI is based on the labor standards of the International Labour Organization (ILO) as well as on national regulations. This initiative aims at continuously improving the social performance of suppliers, ultimately enhancing working conditions in factories worldwide.
Total energy consumption and energy consumption per unit of production are as under:
|Rate / Unit||Rs.||8.36||7.29|
|b) Own Generation through Diesel Generator Set|
|Rate / Unit||Rs.||70.82||61.99|
|c) Coal and other Fuels|
|Rate / Unit||Rs.||8.57||7.70|
TECHNOLOGY ABSORPTION AND ENERGY CONSERVATION:
The Company has a continuous focus on energy conservation. Regular studies are conducted to analyse quantitative energy conservation patterns and variances are rigorously scrutinized. The Company regularly benchmarks its energy conservation levels and consistently works towards improving efficiencies.
NUMBER OF BOARD MEETINGS:
The Board of Directors met 4 (Four) times during the year under review. The details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report which forms part of this Report.
INDEPENDENT DIRECTORS MEETING:
The Independent Directors met one times during the year under review, without the attendance of Non-Independent Directors and members of the Management. The Independent Directors reviewed the performance of non-independent directors and the Board as a whole; the performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors and assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
The Board implemented a formal mechanism for assessing its performance and as well as that of its Committees and individual Directors, including the Chairman of the Board. The exercise was carried out through a designed assessment process covering various features of the Boards functioning such as composition of the Board & committees, experience & proficiencies, performance of specific duties & obligations, contribution at the meetings and otherwise, independent judgment, governance issues etc.
PARTICULARS OF 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 to the Financial Statements.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:
The Companys policy on directors appointment, remuneration and other matters provided in Section178 (3) of the Companies Act, 2013 is available on the website of the Company.
FOREIGN EXCHANGE EARNING AND OUTGO:
Foreign Exchange earnings during the year amounts to Rs. 1,90,62,04,587 (Previous Year Rs. 1,54,68,64,421) and Foreign Exchange outgo during the year was Rs. 10,49,17,491 (Previous Year Rs. 2,11,73,12,655).
CORPORATE SOCIAL RESPONSIBILITY:
The details of Corporate Social Responsibility (CSR) carried out by the Company are appended in the Annexure - B to the Directors Report. The policy is available on the website of the Company on the web link www.freshtrop. com.
The particulars of the CSR committee constituted by the Company pursuant to the provisions of Section 135 of the Companies Act, 2013 and the rules forming part of the same are included in the Corporate Governance Report annexed and form part of this Annual Report.
PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the members at the Registered Office of the Company during business hours on working days of the Company upto the date of the ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the Company Secretary in advance.
CORPORATE GOVARNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
A separate report on Corporate Governance compliance and a Management Discussion and Analysis Report as stipulated by Listing Regulations forms part of this Annual Report along with the required Certificate from a Practising Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated.
In compliance with Corporate Governance requirements, your Company has formulated and implemented a Code of Business Conduct and Ethics for all Board members and senior management personnel of the Company, who have afirmed the compliance thereto.
FORMATION OF VARIOUS COMMITTEES:
Details of various committees constituted by the Board of Directors as per the provision of the SEBI Listing Regulations and the Companies Act 2013 are given in the Corporate Governance Report annexed which is a part of this report.
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE:
As per the requirement, The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 read with rules made thereunder, your Company has constituted Internal Complaints Committee which is responsible for redressal of complaints related to sexual harassment. During the year under review, there were no complaints pertaining to sexual harassment.
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT-9, is annexed to this Report as Annexure-A and available at company website: www.freshtrop.com.
RELATED PARTY TRANSACTIONS:
All the related party transactions entered into during the financial year were on an arms length basis and were in the ordinary course of business. Your Company has not entered into any transactions with related parties which could be considered material in terms of Section 188 of the Companies Act, 2013. Accordingly, the disclosure of related party transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC -2 is not applicable.
SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of Section 204 of the Act read with the rules made thereunder, your Company had appointed Mr. Manoj Hurkat, Practising Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report for financial year 2018-19 is annexed which forms part of this report as Annexure-C. There were no qualifications, reservation or adverse remarks in the Secretarial Audit Report of the Company.
The Board of Directors has reappointed Mr. Kalpesh Parikh as an internal auditor for F.Y. 2019-20.
DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL:
There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.
AUDITORS & AUDITORS REPORT:
Pursuant to the provisions of Section 139 of the Act read with rules made thereunder, as amended from time to time, M/s F P & Associates, Chartered Accountants (Firm Registration Number - 0143262W), were appointed as statutory auditors of the Company to hold office from the conclusion on 25th Annual General Meeting till the conclusion of the 30th Annual General Meeting, subject to ratification of their appointment at every AGM, if required under law.
In view of the Companies (Amendment) Act, 2017, the first proviso in sub-section (1) in section 139 of the Companies Act, 2013 has been omitted with effect form 7th May 2018. In view of this, the said appointment of auditor is no longer required to be ratified by the members at every annual general meeting.
Notes to the financial statements referred in the Auditors Report are self-explanatory and therefore do not call for any comments under Section 134 of the Act. The Auditors Report is enclosed with the financial statements in this Annual Report.
Your Directors place on record their appreciation of the sincere and devoted services, rendered by all employees of the company and the continued support and confidence of the customers. The Board expresses special thanks to progressive farmers of Maharashtra who have worked hard to achieve International Standards in the quality of their produce. The Board also expresses its sincere thanks to Axis Bank Ltd and their officers, Agricultural and Processed Food Products Export Development Authority (APEDA), Ministry of Food Processing Industry (MFPI) and all other well-wishers, for their timely support.
|Date: May 28, 2019||By order of the Board|
|For Freshtrop Fruits Ltd|
|A-603, Shapath IV,||Ashok Motiani|
|Opp. Karnavati Club, S. G. Road,||Chairman & Managing Director|
|Ahmedabad 380 015||(DIN: 00124470)|