Jasch Industries Ltd Directors Report.
Your Directors have pleasure in presenting the 33rd Annual report and audited accounts of the company for the year ended 31st March 2019.
1. Financial Highlights
The performance of company during the financial year ended
31st March 2019 on standalone basis has been as under:
[Rs in lakh)
|Particulars||Current Year 2018-2019||Previous Year 2017-2018|
|Profit before interest and depreciation||1539.22||1339.67|
|Provision for Depreciation||297.24||269.81|
|Net profit before Tax||997.65||821.54|
|Provision for Tax (Net) & Deferred Tax||212.48||285.14|
|Net Profit after Tax||785.17||536.40|
|Balance of profit brought forward||3417.67||2881.27|
|Balance available for appropriation||4202.84||3417.67|
|Amount proposed to be carried to any Reserve||-||-|
|Transfer from General Reserve||-||-|
|Surplus carried to Balance Sheet||4202.84||3417.67|
2. Performance during the financial year under Report
2.1 State of Companys Affairs
Your company has achieved sales of Rs. 153.07 crore during 2018-2019, which were 14% higher as compare with the sales of the previous year. The sales of Synthetic Leather Division at Rs. 107.59 crore were higher by 10.64% as compared with sales of Rs. 97.25 crores during the immediately preceding financial year. The sales of Electronic Gauge Division at Rs. 45.49 crore were 23.78% higher as compared those of immediately preceding financial year. Companys operating profit before interest, depreciation and income tax increased by 14.94% to Rs. 15.39 crore during 2018-19 as compared with Rs. 13.39 crore during the previous year due to lower raw material prices and reduced power 8i fuel. The interest and finance charges were at Rs. 2.44 crore as compared with the previous year.
The net profit after interest, depreciation, income tax and deferred tax have increased to Rs. 7.85 crore, which were 46.45% higher as compared with that of the previous year. Keeping in view prevailing sluggish market conditions resulting in stagnant sales 8i realization of Synthetic Leather, the management considers overall performance to be satisfactory. The Board has not proposed appropriation of any amounts to reserves. During the year, there has not been any change in nature of business of the company. No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future. The financial statements of the company have been audited by independent statutory auditors, who have previously subjected themselves to peer review. Their Audit report, which is annexed, is self-explanatory and does not contain any qualification, reservation, adverse remark or disclaimer calling for comments by the Board.
2.2 Material Changes and commitment, if any, after the date of financial statements, affecting the financial position of the company
No material changes and commitment affecting the financial position of the company have occurred between the end of the financial year to which the financial statements relate and the date of this Directors Report.
Your company is continuously upgrading its technology and modernizing its plant and machinery to maintain a competitive edge in the market.
In the Synthetic Leather segment, the major thrust of your Company has always been towards indigenization of raw material, improvements in the manufacturing process and developing new products. As a result of a major change in the production lines, the production capacity of PVC coated fabrics has, in the opinion of management, increased from 5 lakh metres to 6.5 lakh metres per month w.e.f. 01-07-2018, besides increasing its operational efficiency and speed of production. In the PU coated fabrics segment, the major thrust of the company has been on innovation and development of newer products.
In the Electronics Gauges segment, your Company is developing new types of gauges, which will not be based on nuclear isotopes and X-rays. This will attract new customers.
The management perceives that the above measures will result in increased production 8i profits and also attract high-end consumers.
3. Dividend 8iTransferto Reserve
The management has not proposed any dividend for the year ended on 31st March 2019 or transfer of any amount to reserve.
4. Directors & Key Managerial Personnel
The Board of Directors is the apex body constituted by shareholders for overseeing the Companys overall functioning. The Board provides and evaluates the Companys strategic direction, management policies and their effectiveness and ensures that stakeholders long-term interests are being served. The Chairman and Managing Director (CMD) provides overall direction and guidance to the Board.
The Board has constituted five Committees, namely Audit Committee, Nomination and Remuneration Committee, Finance Committee, CSR Committee, Stakeholders Relationship Committee and is empowered to constitute additional functional Committees from time to time, depending on business needs.
For statements on composition of the Board, Audit Committee, Nomination 8i Remuneration Committee ("NRC"), Stakeholders Relationship Committee and their Meetings held during the Financial Year under Report; Independent Directors, their brief resume, the declarations of Independence given by them and appointment of Key Managerial Personnel, please refer to Annexure A (Corporate Governance Report) which forms an integral part of this Report. Terms and conditions of appointment of Independent Directors can be accessed from the website of the Company at the following web link : www.iaschindustries.com / Filinas 8r Disclosures / Appointment 8rTrainina of Ids.
Shri Manish Garg, retires by rotation at the ensuing Annual General Meeting. He has offered himself for re-appointment for fresh term. Shri Naresh Kumar, who was appointed as Independent Director for a term of five years, vacates his office at the ensuing Annual General Meeting. The Nomination 8i Remuneration Committee, which found their performance to be good, has recommended their re-appointment for fresh terms. The Board recommends the re-appointment of Shri Manish Garg as Director with liability to retire by rotation of directors. The Board also recommends re-appointment of Shri Naresh Kumar as Independent Director for a second term of five years.
5. Particulars of Employees
The Company does not have any employees whose particulars are required to be disclosed in the Directors Report pursuant to the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
6. Board & Board Committee Meetings
Details of Board and Committee Meetings are given in the annexed Corporate Governance Report.
7. Evaluation of Board, its Committees and individual Directors
Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board carries out periodic evaluation of its own performance, that of the directors individually as well as that of its Committees as per the criteria suggested by the Institute of Company Secretaries of India and adopted by the NRC and the Board, which includes knowledge of directors duties and responsibilities; understanding of Companys vision, mission, strategic plan and key issues, diligence and participation in Board, Committee and General Meeting, and leadership traits.
8. Companys Policy on Appointment and Remuneration and other matters relating to Directors
For a policy on Directors appointment, remuneration and criteria for determining their qualifications, positive attributes, independence and evaluation, required to be disclosed under Section 178(3) of the Companies Act, 2013 and under the Listing Regulations, please refer to Annexure B, which forms part of this Report.
9. Disclosure under Section 197(12) of the Act and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
The requisite details relating to ratio of remuneration, percentage increase in remuneration, etc. of managerial personnel, as stipulated under the Section/Rules mentioned in the above sub-heading, are annexed as Annexure C to this Report which forms part of this Report.
10. Subsidiaries. Consolidated Accounts and materiality
Indev Gauging Systems Inc (INDEV), is a wholly owned foreign subsidiary of Jasch North America Co. (JNAC) (the latter in turn being the wholly owned subsidiary of Jasch Industries Ltd). Jasch Automation Ltd (now a dormant company) is the Indian subsidiary of the Company. All these entities existed as subsidiaries of the Company at the beginning and at the end of the Financial Year under report and none of these subsidiaries is a material subsidiary (A subsidiary company is considered as material if the holding Companys investment in the subsidiary company exceeds twenty per cent of consolidated net worth of holding company as per holding companys audited balance sheet of the previous financial year or if the subsidiary company has generated twenty per cent of the consolidated income of the holding company during the previous financial year).
Performance and financial position: JNAC does not perform any business, except supporting Indev by way of providing share capital or investment. Financial statements of JNAC and JAL have been consolidated with the financial statements of the Company for the financial year ended on that date. During the financial year under report, Indev achieved a gross sales and other income of USD equivalent of INR 2569 lakh and earned a profit of USD equivalent of INR 13.16 lakh. As required under law, the consolidated accounts of the Company, which include those of its wholly owned subsidiaries, are annexed to this report.
11. Financial Audit & Financial Auditors Report
M/s Mukesh A Mittal 8i Co., Chartered Accountants, who have subjected themselves to a peer review, have carried out statutory audit of Companys financial accounts during the financial year 2018-19. The report given by them (Auditors Report) is self-explanatory and does not contain any qualification, reservation, adverse remark or disclaimer. There is no matter reportable under Section 143(12) of the Companies Act, 2013.
12. Secretarial Audit & Secretarial Auditors report
During the financial year under Report, the Company subjected itself to Secretarial Audit by Independent Secretarial Auditors, M/s Mukesh Arora 8i Co, Company Secretaries and their report in Form MR-3 is at Annexure D, which forms part of this Report.
13. Cost Audit&Cost Record
During the year, the Company was mandated to maintain cost records and also appoint cost auditors in respect of its products falling under CETA heading 3909 and 3921 (Plastics and Polymers). Accordingly, the Company duly maintained cost records and subjected these to cost audit which was conducted by Vipul Bhardwaj & Company, Cost 8i Management Accountants. Cost Audit Report is required to be submitted by the Cost Auditors to the Board of Directors within 180 days of close of financial year.
14. Internal Audit. Internal Control Systems & Their Adequacy
The Company has engaged CMA Jyoti Gandhi as Independent Internal Auditor. The scope of their work includes review of processes for safeguarding the assets of Company, effectiveness of systems and processes and assessing the internal control strengths in all areas. Management is having tight control on all the operations of the Company. All expenses are scrutinized and approved by the top management. The Company has adequate system so as to have proper check and control on every department. Deviation from established system, if any are placed before Audit Committee of the Board for review and corrective action to be taken, if any.
15. Vigil Mechanism:
In pursuant to the provisions of section 177(9) 8i (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.jaschindustries.com under the link Filings &. Disclosures / RPT, Vigil 8i Other Policies.
16. Risk management policy
A statement indicating business risks and the management policy to manage the risks, forms part of Management Discussion 8i Analysis Report attached with Directors Report.
17. Annual Return
In accordance with the amended provisions of Section 92(3) of the Companies Act, 2013, a copy of Annual Return, after the same has been filed with the Registrar of Companies, will be available at the website of the Company www.jaschindustries.com under the web-link "Filinas 8t Disclosures".
The Company neither had any deposits at the beginning of the year, nor did it accept any deposits during the year under report. Therefore, there was no occasion for any deposits to remain unpaid or unclaimed or in default for repayment of principal or interest thereon.
19. Loans. Guarantees and Investments
As required under Section 186 of the Companies Act, 2013, full particulars of loans and guarantees given, investments made and security provided during the year under Report are contained in the accompanying financial statements.
20. Related Party Transactions
On the recommendation of the Audit Committee, the Board of Directors of the Company has adopted a policy to regulate transactions between the Company and parties related to it. This Policy has been uploaded on the website of the Company at www.iaschindustries.com under the link Filings & Disclosures/RPT, Vigil & Other Policies.
All the related party transactions that were entered during the financial year were on arms length basis and were in the ordinary course of the business. The Audit Committee had granted prior omnibus approval to certain related party transactions and the same were subsequently placed before the Audit Committee on quarterly basis for its approval or modification, as the case may be.
Disclosures pursuant to Section 188 of the Companies Act, 2013, Regulation 34(3) of Listing Regulations and other applicable provisions of laws are enclosed in Form AOC-2 as Annexure - E and also by way to Notes to Financial Statements which may be read as part of the Directors Report. Pursuant to Section 188(2) of the Companies Act, 203, it is stated that Shri Rushil Garg, a relative of directors, was appointed as a Chemical Engineer to oversee the production of PU synthetic resin in the Company. His remuneration and other details are contained in the said Annexure/Notes.
There were no material related party transactions with the Companys Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company.
21. Corporate Governance Report & Certificate
The Company is committed to maintaining the highest standards of corporate governance and adhering to the corporate governance requirements set out by SEBI. Corporate Governance Report, together with requisite certificate from the Independent Statutory Auditors of the Company, confirming compliance with the conditions of corporate governance as stipulated under the Listing Regulations, is attached and forms an integral part of this Report.
22. Management Discussion and Analysis Report
For Management Discussion & Analysis Report, please refer to Annexure F, which forms a part of this Report.
23. Disclosure Pursuant To Section 22 of Sexual Harassment of Women At Workplace (Prevention, Prohibition & Redressalf Act. 2013
In accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition 8i Redressal) Act, 2013, the Company has a policy on prevention of, and affirmative action for, sexual harassment of women, about which all the employees are communicated periodically. For this purpose, the Company has also constituted an Internal Complaints Committees. At the beginning or end of the financial year under report, no cases were pending and during the year, no cases were filed or disposed of under that Act.
24. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings & Outgo
Information required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is given in the Annexure G to this report.
25. ISO Certification
The Company has ISO 9001:2015 certification for Quality Standards and ISO 14001:2015 certification for environmental management systems.
The Equity Shares of the Company are listed on BSE. The same were also listed at the Calcutta Stock Exchange Ltd (CSE) for a part of the year and the same have been delisted from CSE at Companys requestw.e.f. 30-08-2018.
27. Corporate Social Responsibility
In accordance with provisions of Section 134(3), the Board set up a Corporate Social Responsibility (CSR) Committee which developed a Policy for carrying out activities which are as specified in Schedule VII to the Companies Act, 2013. During the financial year 2018-19, the Company spent Rs. 15,93,220 on CSR activities, which amount is slightly more than 2% of Companys average profits of the preceding three years.Information required under Rule 8 and 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is given in the Annexure H to this report.
28. Directors Responsibility Statement
Pursuant to Section 134 of the Companies Act, 2013, the Directors affirm that:
(i) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation, if any, relating to material departures;
(ii) Appropriate accounting policies had been selected and applied consistently, and judgments and estimates made were 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 profits of the Company for the year ended 31st March 2019.
(iii) Proper and sufficient care had 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.
(iv) The annual accounts had been prepared on a going concern basis.
(v) Internal financial controls were laid down to be followed by the Company and such internal financial controls were adequate and were operating efficiently.
(vi) Proper systems had been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and were operating effectively.
Your directors wish to place on record their appreciation of the devoted services rendered by the workers, the staff and the executives of the Company and for the continued support from the shareholders, the lenders and other associates.
|For & on behalf of the Board|
|Place : Sonipat||(J.K. GARG)|
|Date : 29-05-2019||Chairman|