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The Directors are pleased to present the 38th Annual Report on the business and operations of Khadim India Limited ("the Company") together with the Audited Financial Statements for the financial year ended March 31,2019.
The Financial Highlights are set out below:
|Revenue from Operations||7991.81||7487.06|
|Profit before Depreciation, Interest and Tax||632.77||849.46|
|Profit Before Tax||332.04||569.61|
|Provision for Taxation|
|- Current and Deferred Tax||120.34||190.60|
|Profit for the year after tax||211.70||379.01|
The Directors of your Company are pleased to recommend a dividend of र 1/- per equity share of face value of र 10/- each for the financial year ended March 31,2019, subject to the approval of the shareholders of the Company at the ensuing Annual General Meeting. The total cash out flow on account of the dividend payment would be र 21.66 million.
The dividend payout is in accordance with the Companys dividend distribution policy which has been voluntarily adopted by the Company vide its Board meeting dated May र 17, 2019. The said policy is available on the Companys website www.khadims.com at the link https://www.khadims.com/dividend-distribution-policy/.
No amount has been transferred to the General Reserve for the financial year ended March 31,2019.
Operations and State of Companys Affairs
The revenue generated from operations for the financial year 2018-19 stood at र 7991.81 million which was higher by 6.74% from the financial year 2017-18. The profit for the year was र 211.70 million in comparison to र 379.01 million for the last financial year.
The details of Companys affairs has been included in the Management Discussion and Analysis Report, forming part of this report.
The details in regard to Internal Financial Control and its adequacy are included in the Management Discussion & Analysis Report, which is a part of this Report.
Employee Stock Option Plan
There has been no material change in the Employee Stock Option Scheme (ESOP) during the year under report. Disclosures with respect to ESOP as required under regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, are available in the Notes to the Financial Statements. A certificate from M/s. Deloitte Haskins & Sells, Statutory Auditors of the Company with respect to the implementation of the Companys ESOP would be placed before the shareholders at the ensuing Annual General Meeting. A copy of the same will also be available for inspection at the registered office of the Company.
During the year, 4,417 Equity Shares of र 10/- each, fully paid up were issued and allotted upon exercise of 4,417 options under the Employee Stock Option Plan of the Company. Consequently, the issued, subscribed and paid up share Capital of your Company stands increased to र 17,96,96,140 divided into 1,79,69,614 Equity Shares of face value of 10/- each.
Change(s) in the nature of the business
There has been no change(s) of business of the Company or in the nature of business carried on by the Company during the financial year under review.
Material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year to which the financial statements relate and the date of the report
No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year of the Company to which the financial statements relate and the date on which this Report has been signed.
Significant and material orders passed by the regulators/courts/tribunals impacting the going concern status and the Companys operations in future
During the year under review, no significant and material orders have been passed by the regulators / courts / tribunals that may impact the going concern status and the operations of the Company in future.
Subsidiaries, joint ventures and associate companies
The Company does not have any subsidiary company / associate company / joint venture company. However, the Company is in the process of incorporating a wholly owned subsidiary Company in Bangladesh in accordance with the in principle approval given by the Board of Directors vide its meeting dated February 07, 2019.
The Company has not accepted any deposit from public within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 and as such no unclaimed / unpaid matured deposits or interest thereon was due as on March 31,2019.
Corporate Social Responsibility
Your Company believes that Corporate Social responsibility (CSR) is an integral part of its business. It seeks to operate its business in a sustainable manner which would benefit the Society at large in alignment with the interest of its stakeholders. As per the requirements of Section 135 of the Companies Act, 2013 pertaining to Corporate Social Responsibilities, your Company has duly constituted a CSR Committee.
The CSR Policy of the Company framed under the provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 is available on the Companys website www.khadims.com. The Annual Report on CSR activities for the financial year ended March 31,2019 along with the composition of CSR Committee is marked as Annexure - I and forms part of this Report.
Risk Management Policy
The Companys Risk Management Policy recognizes that risk is an integral part of any business and the Company is committed to manage the risk in a proactive and efficient manner.
Vigil Mechanism / Whistle Blower Policy
The Company has a Vigil Mechanism / Whistle Blower policy and it has established adequate vigil mechanism for its employees and directors to report concern about unethical practice. No person has been denied access to the Chairman of the Audit committee. The latest Vigil Mechanism / Whistle Blower Policy is available at https://www.khadims.com/policy-on-vigil- mechanism/.
Directors and Key Managerial Personnel
Your Companys Board is duly constituted in compliance with the requirement of the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations).
The Independent Directors have confirmed that they meet the criteria of Independence as required under sub Section 7 of Section 149 of the Companies Act, 2013 and the Listing Regulations.
The Board was also of the opinion that Independent Directors meet the criteria of independence under sub section 6 of Section 149 of the Act and Regulation 16(1)(b) of the Listing Regulations.
There has been no change in the circumstances affecting their status as independent directors of the Company.
Ms. Namrata Ashok Chotrani (DIN: 00390845) and Mr. Ritoban Roy Burman (DIN: 08020765), were appointed as Non-Executive Directors (additional) of the Company with effect from December 14, 2017 by the Board of Directors of the Company.
Mr. Alok Chauthmal Churiwala (DIN: 02043221), was appointed by the Board as an Independent (additional) Director of the Company with effect from May 11,2018.
The said appointments had been confirmed by the members vide its Annual General Meeting dated September 06, 2018.
A Postal Ballot Notice dated March 26, 2019 has been sent to all the members seeking their consent for continuation of office of Dr. Indra Nath Chatterjee (DIN: 00122677) as an Independent Director of the Company on attaining 75 years of age on June 15, 2019 and his re - appointment as an Independent Director for a second term of 5 consecutive years commencing from September 29, 2019 till September 28, 2024.
Ms. Namrata Ashok Chotrani (DIN: 00390845), Non-Executive Director, retires by rotation at the ensuing Annual General Meeting, and being eligible, offered herself for re-appointment. The brief profile of Ms. Chotrani and other relevant information under Regulation 36 of the Listing Regulations and Secretarial Standard on General Meetings with respect to Director seeking re-appointment has been provided in the Notice convening Annual General Meeting. Your Directors recommend her re-appointment at the ensuing Annual General Meeting.
The Board has re-appointed, subject to approval of the members of the Company, Mr. Siddhartha Roy Burman (DIN: 00043715) as the Chairman & Managing Director (also as Whole - time "Key Managerial Personnel") of the Company for a period of 5(five) years with effect from April 01,2019. Approval of the members of the Company is being sought by way of special resolution at the ensuing Annual General Meeting of the Company for the said re-appointment.
Pursuant to the provisions of Section 203 of the Companies Act, 2013 the Key Managerial Personnel of the Company as on March 31, 2019 are:
Mr. Siddhartha Roy Burman, Chairman & Managing Director, Ms. Ishani Ray, Chief Executive Officer, Mr. I ndrajit Chaudhuri, Chief Financial Officer and Mr. Abhijit Dan, Company Secretary & Head - Legal.
The Board of Directors at its meeting held on March 26, 2018, has approved the appointment of Ms. Ishani Ray as the Chief Executive Officer (CEO) and Mr. I ndrajit Chaudhuri as the Chief Financial Officer (CFO) of the Company with effect from April 01,2018. Prior to this Ms. Ishani Ray and Mr. Indrajit Chaudhuri held the position of CFO and General Manager- Commercial & Strategic Planning of the Company respectively.
Familiarisation Programme for Independent Directors
The Company has put in place an Induction and Familiarisation Programme. The details of such Familiarization Programme are mentioned in the Report on Corporate Governance, which forms part of this Annual Report and the same is available at the link https://www.khadims.com/familiarization-programme-independent-director/.
Separate Meeting of Independent Directors
In terms of requirements of Schedule IV of the Companies Act, 2013 and the Listing Regulations, the Independent Directors of the Company met separately on November 2, 2018 and March 26, 2019.
Companys Policy on Appointment and Remuneration of Directors
The Company has been following a policy namely "Nomination and Remuneration Policy" with respect to appointment and remuneration of Directors, Key Managerial Personnel (KMP) and Senior Management Personnel. The appointment of Directors,
KMP and Senior Management is subject to the recommendation of the Nomination and Remuneration Committee (NRC). Based on the recommendation of the NRC, the remuneration of Executive Director comprises of Basic Salary, Perquisites, Allowances and Commission in accordance with the provisions of the Companies Act, 2013. The remuneration of Non-Executive Directors comprises of sitting fees and commission in accordance with the provisions of Companies Act, 2013.
Nomination and Remuneration Policy
The Nomination and Remuneration Policy of the Company is in conformity with the requirement of Section 178 (3) of the Companies Act, 2013 and Listing Regulations. The objectives and key features of this Policy are:
Formulation of the criteria for determining qualifications, positive attributes and independence of the Directors, Key Managerial Personnel and Senior Management Personnel;
Devising a policy on Board diversity;
Identifying persons who are qualified to become Directors and persons who may be appointed in Key Managerial and Senior Management positions in accordance with the criteria laid down in this policy;
Directors induction and continued updation as and when required of their roles, responsibilities and liabilities;
Formulation of criteria for performance evaluation of the Board, its Committees and Directors including Independent Directors/ Non-Executive Directors;
Aligning the remuneration of Executive Directors, Key Managerial Personnel and Senior Management Personnel with the Companys financial position, industrial trends, remuneration paid by peer companies etc.; and
Recommend to the Board all the remuneration in whatever form, payable to the Senior Management.
The guiding principles of the Policy are:
The level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;
Relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and
Remuneration to Directors, Key Managerial Personnel and Senior Management involves a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goals.
The aforesaid Nomination and Remuneration Policy has been uploaded on the website of your Company www.khadims.com and is available at the link: https://www.khadims.com/policy-on-nomination-remuneration-committee/
Meetings of the Board
During the year, five meetings of the Board were held. The details of meetings of the Board held during the financial year 2018-19 have been provided in the Corporate Governance Report which forms part of the Report.
The details pertaining to the composition of the Audit Committee are included in the Corporate Governance Report which is a part of this Report.
Extract of Annual Return
The details forming part of 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, has been enclosed with this report as Annexure II and uploaded in the website of the Company www.khadims.com.
Particulars of contracts and arrangement with Related Parties
All transactions entered by the Company with Related Parties during the financial year 2018-19 as defined under Section 2(76) of the Companies Act, 2013 read with the Companies (Specification of Definitions Details) Rules, 2014 were in the Ordinary Course of Business and at Arms Length pricing basis. There were no materially significant transactions with Related Parties during the financial year 2018-19, which were in conflict with the interest of the Company. Suitable disclosures as required under Ind AS 24 have been made in the Notes to the financial statements.
Accordingly, the disclosure in Form AOC-2, pursuant to section 134(3)(h) of the Companies Act, 2013, read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is not required. The policy on Related Party Transactions can be accessed on the website of the Company www.khadims.com.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rules made thereunder, the Company had re - appointed Mr. Binod Kumar Gupta (Membership No. A12965, C.P. No. 3242) of M/s. BKG & Company, Company Secretaries to conduct the Secretarial Audit for the Financial Year 2019-20.
The Secretarial Audit Report for the Financial Year ended March 31,2019 is annexed herewith and marked as Annexure - III to this report.
The Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer.
The Company has devised adequate systems to ensure compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and such systems are operating effectively.
Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013 ("the Act"), your Directors to the best of their knowledge and ability confirm that:
a) in the preparation of the annual accounts for the financial year ended March 31,2019, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;
b) the Directors had 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 as at March 31,2019 and of the profit of the Company for the year ended on that date;
c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors had prepared the annual accounts on a going concern basis;
e) proper internal financial controls are followed by the Company and that such financial controls are adequate and are operating effectively; and
f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended March 31,2019.
M/s. Deloitte Haskins & Sells (Firm Registration No. 302009E, Chartered Accountants) was re-appointed by the members of the Company at the 37th Annual General Meeting as Statutory Auditors of the Company for a second term of 5 (Five) consecutive years commencing from the conclusion of the Annual General Meeting held on September 06, 2018 till the conclusion of the 42nd Annual General Meeting to be held in the year 2023.
The Auditors Report on the Annual Accounts of the Company forms part of the Annual Report of the Company.
The Auditors Report does not contain any qualification, reservation or adverse remark or disclaimer.
There is no incident of fraud requiring reporting by the Auditors under Section 143 (12) of the Companies Act, 2013.
Although the Company is not coming under the purview of compulsory cost audit as per the Companies Act, 2013, your Company has continued with the services of the Cost Auditor for the financial year 2018-2019 and for the succeeding financial year.
Particulars of Loans, Investments and Guarantees
During the financial year 2018-19, the Company has not made any investment, has not given any loans, has not provided any guarantees, has not provided any security in connection with any loan, has not acquired securities by way of subscription, purchase or otherwise in excess of the thresholds provided in Section 186 of the Companies Act, 2013.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
The information on conservation of energy, Technology Absorption and Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are given in Annexure - IV, forming part of this Report.
Managerial Remuneration, Particulars of Employees and related disclosure
Details of remuneration as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure - V and VI respectively.
Disclosures under the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013
Your Company strongly believes in providing a safe and harassment free workplace for each and every individual working for the Company through various interventions and practices and has zero tolerance for sexual harassment at workplace. It is the continuous endeavour of the management of the Company to create and provide an environment to all its employees that is free from discrimination and harassment including sexual harassment. The Company has adopted a policy on Prevention of Sexual Harassment at Workplace. An Internal Complaint Committee (ICC) with requisite number of representatives has been set up to redress complaints relating to sexual harassment, if any. The Policy is gender neutral. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.
The Policy under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules framed thereunder is available in the website of the Company at www.khadims.com . No complaints relating to the sexual harassment has been received during the year under report.
Annual Performance Evaluation of the Directors
In terms of the provisions of the Companies Act, 2013 read with Rules issued thereunder and the Listing Regulations, based on the criteria such as number of Board and Committee meetings attended during the year, contributions to the decision making and relevant expertise to the Board etc., the Board of Directors has carried out the annual performance evaluation of the entire Board, Committees and all the Directors based on the criteria laid down by the Nomination and Remuneration Committee.
In a separate meeting of Independent Directors, performance of Non-Independent Directors, the Chairman of the Company and the Board as a whole was evaluated.
A Report on Corporate Governance along with a Certificate from the Statutory Auditors confirming of corporate governance requirements as stipulated under Listing Regulations is enclosed as Annexure - VII and forms part of this Annual Report. The said report also contains a certificate from a practising Company Secretary confirming that none of the Board of Directors of the Company has been debarred or disqualified from being appointed or continuing as director of the Company as prescribed under Listing Regulations.
Management Discussion and Analysis Report
Management Discussion and Analysis Report for the financial year under review, as stipulated under Regulation 34 of the Listing Regulations is presented in a separate section forming a part of this Report.
Statements in the Annual Report, including 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. Although the expectations are based on reasonable assumptions, the actual results might differ.
Your Directors would like to express their sincere appreciation for the assistance and cooperation received from the financial institution, banks, merchant bankers, legal consultants, registrar, government authorities, customers, vendors and members during the year under review. Your Directors also acknowledge the continued support received from investors and shareholders and the confidence reposed by them. Your Directors also wish to place on record their deep sense of appreciation for the committed service by the executives, staffs and workers of the Company.
|For and on behalf of the Board of Directors|
|Siddhartha Roy Burman|
|Place: Kolkata||Chairman & Managing Director|
|Date: May 17, 2019||DIN: 00043715|