Madhav Copper Ltd Directors Report.

Dear members,

Your Directors have pleasure in presenting the 7th Annual Report on the business and operations of the Company and the Audited Accounts for the Financial Year ended 31st March 2019.

1. SUMMARY OF FINANCIAL RESULTS:

(Amount in Rupees)
Particulars Current Year Previous Year
2018-19 2017-18
Net Sales/Income from Business operations 2,128,774,856 1,688,193,679
Other Income 649,670 2,387,397
Total income 2,129,424,525 1,690,581,076
Less: Expense (Excluding depreciation) 2,052,511,445 1,652,464,061
Profit before Depreciation 76,913,080 38,117,015
Less: Depreciation 17,724,556 6,607,763
Profit before Tax 59,188,524 31,509,252
Add: Exceptional item -- 481,755
Profit before Tax 59,188,524 31,991,007
Less: Current tax 18,000,000 9,010,000
Less: Deferred tax 4,595,566 (425,070)
Less : Excess Provision of earlier years 176,250 (270,748)
Net Profit/ (Loss) after Tax for the year 36,416,708 23,676,825
Balance carried to the Balance Sheet 36,416,708 23,676,825
Earnings per share(Basic & Diluted) 5.91 11.53

2. DIVIDEND:

With a view to finance expansion from internal accrual for the growth of the Company, the directors do not recommend any dividend for the year ended March 31, 2019.

3. OPERATIONAL HIGHLIGHTS AND PROSPECTS:

Operational highlights:

The Company earned operational income of 2,128,774,856 compared to 1,688,193,679 in the previous year. The other income is 649,670 compared to 2,387,397 in the previous year.

Profit after tax for the year under review is 36,416,708 as compared to previous year figure of 23,676,825.

4. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company does not have any Subsidiary, Joint venture or Associate Company.

5. CREDIT FACILITIES:

The Company has been optimally utilizing its ‘fund based’ and ‘non-fund based’ working capital requirements as tied up with Bank of Baroda, Axis Bank Limited and Aditya Birla Finance Limited. During the year under review, the Company was comfortable in meeting its financial requirements. Effective financial measures have been continued to reduce cost of interest and bank charges.

6. SHARE CAPITAL AND CHANGES:

Changes in Share Capital during the year under review are as follow:

Buy-back of Securities:

The Company has not bought back any of its securities during the year under review.

Sweat Equity:

The Company has not issued any Sweat Equity Shares during the year under review.

Bonus Shares:

The Company has issued and allotted 41,07,200 (Forty One Lakh Seven Thousand Two Hundred) Equity shares of 10/- (Rupees Ten Only) each, as bonus shares during the year under review.

Employees Stock Option Plan:

The Company has not provided any Stock Option Scheme to the employees.

7. MATERIAL CHANGES:

There are no significant events affecting the financial position between the end of the financial year and date of the Report except following-

Sub division of shares: In order to improve the liquidity of Company’s equity shares in the Stock Markets with higher floating stock in absolute numbers and to make it more affordable for the small retail investors to invest in the Company, the Company has sub-divided the face value of the equity shares of the Company from Rs. 10/- each to Rs. 5/- each.

Lot size of shares: Lot size of the Company’s shares has been reduced from 2,400 shares to 600 shares by NSE w.e.f 5th August, 2019.

8. CAPITAL EXPENDITURE FOR EXPANSION PROJECT:

As mentioned in previous report, the Company was undergoing an expansion and accordingly, the Company has completed installation of copper Furnace in November 2018 for new products. The Company proudly announces that the production through such furnace is already started.

However, the Company has not incurred any capital expenditure for expansion during the year under review.

9. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure I and is enclosed to this report.

10. RISK MANAGEMENT:

The Company has framed a sound Risk Management Policy to identify and evaluate business risks and opportunities and the same has become integral part of the Company’s day to day operations. The key business risks identified by the Company are Industry risk, Management and Operations risk, Market risk, Government policy risk, Liquidity risk, and Systems risk. The Company has in place adequate mitigation plans for the aforesaid risks. The Policy on Risk Management is available on website of the Company under tab Investor Info/Policies/Risk Management Policy.

11. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

The Corporate Social responsibility provisions are now applicable to the Company. Accordingly, the Company has constituted Corporate Social Responsibility Committee (CSR Committee).

12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

Loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.

13. RELATED PARTY TRANSACTIONS:

There were materially significant related party transactions with the Company’s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. All transactions entered into with the related parties are occurred at Arms’ length price and in ordinary course of business. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as Annexure II.

The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its related parties, in compliance with the applicable provisions of the Companies Act 2013, the rules made thereunder and the SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015. This policy was considered and approved by the Board and has been uploaded on the website of the Company at www.madhavcopper.com under Investors/ Policies/Policy on Related Party Transactions.

14. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL:

During the year under review, there were no changes in the Directors and Key Managerial Personnel.

Composition of Board of Directors:

Thus, the Board of Directors of Company is a balanced one with an optimum mix of Executive and Non Executive Directors. They show active participation at the board and committee meetings, which enhances the transparency and adds value to their decision making. The Board of the Company is headed by an Executive Chairman. Chairman takes the strategic decisions, frames the policy guidelines and extends wholehearted support to Executive Directors, business heads and associates.

As on 31st March, 2019, the Board of Company consists of Six (6) Directors.

(a) The composition and category of Directors as well as other details are as follow:

Sr. No. Name of Director Category DIN No. of Board Meeting attended during the year under review Whether attended last AGM No. of membership in committee in other Public Limited Company
1 Mr. Nilesh N. Patel Promoter & Chairman 05319890 9 YES NIL
2 Mr. Rohitbhai B. Chauhan Promoter & Managing Director 06396973 8 YES NIL
3 Mr. Divya Monpara Promoter & Non- Executive Director 06396970 8 YES NIL
4 Mrs. Rakshaben R. Chauhan Non Executive Director 07600985 7 YES NIL
5 Mr. Manish Makodia Non Executive & Independent Director 07600988 9 YES NIL
6 Mr. Chaitnya Doshi Non Executive & Independent Director 07600986 7 YES NIL

(b) The dates of the meeting of Board held during the year under review are as follow:

Sr. No. Date of Board Meeting

Total strength of Board

No. of Directors present

1 28th May, 2018 6 6
2 4th August, 2018 6 6
3 7th September, 2018 6 4
4 28th September, 2018 6 5
5 5th November, 2018 6 4
6 14th November, 2018 6 5
7 7th February, 2019 6 6
8 19th March, 2019 6 6
9 31st March, 2019 6 6

Notes:

(i) Directorships exclude Private Limited Companies, Foreign Companies and Section 8 Companies.

(ii) Chairmanship/Membership of Committee only includes Audit Committee and Stakeholders’ Relationships Committee in Indian Public Limited companies other than Madhav Copper Limited. Members of the Board of the Company do not have membership of more than ten Board-level Committees or Chairperson of more than five such Committees.

(iii) None of the directors are related to each other except Mr. Rohitbhai Chauhan and Mrs. Rakshaben Chauhan are related to each other.

(iv) Details of Director(s) retiring or being re-appointed are given in notice to Annual General Meeting.

(v) Brief profiles of each of the above Directors are given in the beginning of the report.

14.1 Board Evaluation:

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of SEBI (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 and Remuneration and Compliance Committees.

14.2 Board Committees and their Meetings:

The Company has the following Committees of the Board along with details of its compositions.

Sr. No. Name of Committee Members
1 Audit Committee Mr. Manish Makodia - Chairman
Mr. Chaitanya Doshi - Member
Mr. Nilesh Patel - Member
2 Nomination And Remuneration Committee Mr.Manish Makodia - Chairman
Mr. Chaitanya Doshi - Member
Mrs. Rakshaben Chauhan - Member
3 Stakeholders Relationship Committee Mr. Chaitanya Doshi - Member
Mr.Manish Makodia - Chairman
Mrs. Rakshaben Chauhan - Member

During the year under review, following meetings were held and the details of members attended meetings are given below:

Audit Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Manish Makodia Independent Director 4 4
Mr. Chaitnya Doshi Independent Director 4 4
Mr. Nilesh Patel Whole-time director 4 4

Nomination and Remuneration Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Manish Makodia Independent Director 2 2
Mr. Chaitnya Doshi Independent Director 2 2
Mrs. Rakshaben Chauhan Non Executive Director 2 2

Stakeholders Relationship Committee:

Name Category Meeting held during the Year Meeting attended during the Year
Mr. Chaitnya Doshi Independent Director 2 2
Mr. Manish Makodia Independent Director 2 2
Mrs. Rakshaben Chauhan Non Executive Director 2 2

14.3 Remuneration Policy:

The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Policy on Nomination and Remuneration is available on the website of the Company under Investor Info/Policies/Nomination and Remuneration Policy.

14.4 Code of Conduct:

The Board has laid down a Code of Conduct for all Board Members and Senior Management of the Company which is posted on the website of the Company under Investor Info/Policies/Code of Conduct. All Board Members and Senior Management Personnel have affirmed compliance with the Code on an annual basis.

14.5 Insider Trading:

The Board has in consultation with the Stakeholders’ Relationship Committee laid down the policy to regulate and monitor Insider Trading. The Committee regularly analyzes the transactions and monitors them to prevent Insider Trading. The policy on Insider Trading is available on the website of the Company under Investor Info/Polices/Code of Conduct for prevention of Insider Trading Policy.

14.6 Meetings:

During the year, 9 Board Meetings, 4 Audit Committee Meetings, 2 Nomination and remuneration Committee Meetings and 2 Stakeholders Relationship Committee Meetings were held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. Details of Meetings are given under respective heads.

14.7 Declaration of Independent Directors:

The Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

14.8 Familiarisation Programme for Independent Director:

The Company has made practice of regularly informing the Directors all the changes in the Company as well as changes in laws which are applicable to the Company at Board meeting held during theyear.

15. WHITSLE BLOWER & VIGIL MECHANISM:

In pursuant to the provisions of section 177(9) & (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.madhavcopper.com under Investors/policies/Vigil Mechanism Policy link.

16. DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submits its responsibility Statement:—

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

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 at the end of the financial year and of the profit and loss of the Company for that period;

c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this 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; and

e) the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

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.

17. ANNUAL RETURN:

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is furnished in Annexure III and the same is enclosed to this Report. This report is also available on the website of the Company at www.madhavcopper.com.

18. DEPOSITS:

The Company has neither accepted nor renewed any deposits during the year under review.

19. AUDITORS & AUDITORS’ REPORT:

Statutory Auditors:

M/s. Nirav Patel & Co., Chartered Accountants were appointed as Statutory Auditors of your Company at the Annual General Meeting held on 8th August, 2017, for a term of five consecutive years. In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting. The Report given by the Auditors on the financial statement of the Company is part of this Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

Statutory Auditors’ Report:

The observation made in the Auditors Report read together with relevant notes thereon are self explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.

There is no qualification, reservations or adverse remarks made by the Auditors.

Secretarial Auditor:

M/s. Kashyap Shah & Co., Company Secretaries in practice, Vadodara (COP No. 6672), was appointed as a Secretarial Auditor of the Company to conduct Secretarial Audit for the financial year 2018-19 as required under Section 204 of the Companies Act, 2013 and Rules there under.

Secretarial Auditor’s Report:

The Secretarial Audit Report for the financial year ended 31st March, 2019 is self-explanatory and does not call for any further comments.

There is no qualification, reservations or adverse remarks made by the Auditors.

The Secretarial Audit Report for the financial year ended March 31, 2019 is annexed herewith marked as Annexure IV to this Report.

Internal Auditor:

As per Section 138 of Companies Act 2013, every Listed Company is required to appoint an Internal Auditor or a firm of Internal Auditors.

The Board of directors are pleased to confirm the appointment of M/s. Nirav Shah & Co., as Internal Auditors of the Company.

Cost Auditor:

M/s. S. K. Rajani & Co., Cost Accountants have been appointed to conduct Cost Audit of the Company for the year ending 31st March, 2020. Pursuant to the provisions of Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, members are requested to consider the ratification of the remuneration payable to M/s. S. K. Rajani & Co.

The remuneration of Cost Auditors has been approved by the Board of Directors on the recommendation of Audit Committee. The requisite resolution for ratification of remuneration of Cost Auditors by members of the Company has been set out in the Notice of ensuing Annual General Meeting. The Cost Auditors have confirmed that their appointment is within the limits prescribed u/s 141(3)(g) of the Companies Act, 2013 and that they are not disqualified from being appointed within the meaning of the said Act.

GST Auditor

The Board of directors are pleased to confirm the appointment of M/s. Nirav Shah & Co., as GST Auditors of the Company for FY 2018-19.

20. INTERNAL CONTROL S STEM AND THEIR ADEQUACY:

The Company has adequate system of internal control to safeguard and protect from loss, unathorised use or disposition of its assets. All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accenting Standards for properly maintaining the books of accounts and reporting financial statements. The internal auditor of the Company checks and verifies the internal control and monitors them in accordance with policy adopted by the Company.

The Company continues to ensure proper and adequate systems and procedures commensurate with its size and nature of its business.

21. MARKET PRICE OF SHARES OF THE COMPANY DURING THE YEAR UNDER REVIEW:

Month High (Amount ) Low (Amount )
April 2018 283.50 246.00
May 2018 430.00 279.00
June 2018 412.00 355.80
July 2018 395.00 343.90
August 2018 437.00 328.70
September 2018 457.80 137.00
October 2018 154.00 134.25
November 2018 152.00 134.00
December 2018 151.80 135.00
January 2019 212.10 148.00
February 2019 317.00 200.00
March 2019 358.00 296.25

22. PARTICULARS OF EMP OYEES:

None of the employee has received remuneration exceeding the limit as stated in Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

23. HUMAN RESOURCES:

During the period under review, the personal and industrial relations with the employees remained cordial in all respects. The management has always carried out systematic appraisal of performance and imparted training at periodic intervals. The Company recognizes talent and has judiciously followed the principle of rewarding performance.

24. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has zero tolerance for sexual harassment at its workplace. The Company has adopted an Anti-harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee are set up to redress complaints received regularly and are monitored by women line supervisors who directly report to the Chairman & Managing Director. All female employees are covered under the policy. There was no complaint received from any employee during the financial year 2018- 19 and hence, no complaint is outstanding as on March 31, 2019 for redressal.

25. DETAILS OF SIGNIFICANT MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

There were no material orders passed by the regulators or court or tribunals impacting the going concern status and company’s operations in future.

26. ACKNOWLEDGEMENTS:

Your Directors place on record their sincere thanks to bankers, business associates, consultants, and various Government Authorities for their continued support extended to your Companies activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their support and confidence reposed on the Company.

For and on behalf of the Board of Directors of
MADHAV COPPER LIMITED
SD/- SD/-
Nilesh Patel Rohit Chauhan
Chairman & WTD Managing Director
DIN: 05319890 DIN:06396973
Place: Bhanvagar
Date: 30th August, 2019