Mandhana Retail Ventures Ltd Directors Report.
The Directors have pleasure in presenting the 8th Annual Report and the Audited Accounts of the Company for the year ended 31st March, 2019.
1. Financial Highlights
(Rs. In Lakh)
|Profit Before Interest, Depreciation and Taxation||641.85||2,095.74|
|Less: 1. Interest||(245.70)||(177.24)|
|Profit Before Taxation||10.45||1,551.14|
|Less: Provision for Taxation|
|Net Profit for the Year||(33.9)||990.06|
|Less: Income Tax paid for earlier year||(25.01)||(87.34)|
|Profit after Taxation||(58.91)||902.72|
|Add : Other Comprehensive Income for the Year||0.73||10.38|
|Total Comprehensive Income for the year||(58.18)||913.10|
|Less: Transfer to General Reserve||0.00||0.00|
|Balance carried forward||(58.18)||913.10|
Note: Figures in brackets represent negative number.
2. Company Performance and Business Overview
A detailed discussion of operations for the year ended 31st March, 2019 is provided in the Management Discussion and Analysis Report, which is presented in a separate section forming part of this Annual Report.
In view of losses, the Board of Directors of your company does not recommend dividend for the year under review.
4. Transfer to Reserve
The Company does not propose to transfer amounts to the general reserve for the financial year 2018-19.
5. Material Changes and Commitments, if any, Affecting the Financial Position of the Company Which Have Occurred Between the End of the Financial Year of the Company to which the Financial Statements Relate and the Date of the Report
No material changes and commitments have occurred after the close of the financial year till the date of this report, which affect the financial position of the Company.
6. Corporate Governance
Reports on Corporate Governance and Management Discussion and Analysis, in accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), along with a certificate from Auditors regarding compliance of the Corporate Governance are given separately in this Annual Report.
All Board Members and Senior Management Personnel have affirmed compliance with the code of conduct for the financial year 2018-19. A declaration to this effect signed by the Chief Executive Officer of the Company is contained in this annual report.
7. Public Deposit
Your Company has not accepted any Public Deposits under Chapter V of the Companies Act, 2013.
8. Directors and Key Managerial Personnel (KMP)
In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of Company, Mrs. Sangeeta Mandhana retires by rotation and being eligible, offers herself for reappointment. Brief details of Mrs. Sangeeta Mandhana as required under Regulation 36(3) of Listing Regulations are provided in the notice of the ensuing Annual General Meeting.
The Members of the Company in the 5th Annual General Meeting held on 7th September, 2016, have approved the appointment of Mrs. Sangeeta Mandhana and Mr. Priyavrat Mandhana as the Managing Director and Executive Director of the Company, respectively, for a period of 3 (three) years effective from 1st September, 2016 to 31st August, 2019. Further, in accordance with the Schedule V and other applicable provisions of the Companies Act, 2013, on the recommendation made by the Nomination and Remuneration Committee and the Audit Committee of the Company at its meeting held on 30th May, 2019, the Board of Directors of the Company at its meeting held on even date has approved the re-appointment of Mrs. Sangeeta Mandhana as Managing Director and Mr. Priyavrat Mandhana as Executive Director for a further period of 3 years commencing from 1st September, 2019 on terms and conditions as set out in the resolutions mentioned in the Notice convening the 8th Annual General Meeting of the Company.
The members approval is being sought at the ensuing Annual General Meeting for the above appointment.
The Company has received declarations from all the
Independent Directors of the Company, confirming that they meet the criteria of independence as prescribed under the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. In the opinion of the Board, the Independent Directors, fulfill the conditions of independence specified in Section 149(6) of the Act and Regulation 16(1) (b) of the Listing Regulations.
Mr. Hemant Gupta has resigned from the office of Chief Financial Officer (CFO) and Chief Operating Officer of the Company w.e.f. 15th December, 2018. Subsequent to his resignation, the Board of Directors at its meeting held on 16th March, 2019, delegated the additional duty/charge pertaining to the office of the CFO to Mrs. Sangeeta Mandhana, Managing Director of the Company, until the appointment of a suitable candidate for the post of CFO. During the year under review, none of the other KMP of the Company resigned from their respective positions.
9. Board Evaluation
The Board of Directors has carried out an annual evaluation of its own performance, Board Committees, and individual directors pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations. The Company has implemented a system of evaluating performance of the Board of Directors and of its Committees and individual Directors on the basis of a structured questionnaire which comprises evaluation criteria taking into consideration various performance related aspects.
The Companys Independent Directors met on 13th February, 2019 without the presence of Executive Directors or Members of the Management. All the Independent Directors attended the Meeting. The Board of Directors expressed its satisfaction with the evaluation process.
10. Number of Meetings of the Board of Directors
During the year 5 (Five) Board Meetings were convened and held. Details of meetings of the Board and its Committees alongwith the attendance of the Directors therein, have been disclosed in the Corporate Governance Report (Annexed herewith).
11. Vigil Mechanism / Whistle Blower Policy for Directors and Employees
The Company has established a Vigil Mechanism, which includes a Whistle Blower Policy, for its Directors and Employees, to provide a framework to facilitate responsible and secure reporting of concerns of unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct & Ethics.
The Board has revised the Vigil Mechanism/Whistle-Blower policy to insert "reporting of incidents of leak or suspected leak of Unpublished Price Sensitive Information (UPSI)" in terms of Securities and Exchange Board of
India (Prohibition of Insider Trading) Regulations, 2015, as amended from time to time. The Policy as approved by the Board may be accessed on the Companys website and the web-link to the same is https://www.mandhanaretail. com/investor-relations.php
12. Audit Committee
As on 31st March, 2019, the Audit Committee comprised of four members viz. 3 Independent Directors and 1 Executive Director, given as under:
1. Mr. Kiran Vaidya - Chairman
2. Mr. Pradip Dubhashi
3. Mr. Ramnath Pradeep
4. Mr. Priyavrat Mandhana
Further details on the Audit Committee are provided in the Corporate Governance Report (Annexed herewith).
13. Nomination and Remuneration Policiy
The Board of Directors has formulated a Policy which lays down a framework for selection and appointment of Directors and Senior Management and for determining qualifications, positive attributes and independence of Directors.
The Policy also provides for remuneration of Directors, Members of Senior Management and Key Managerial Personnel.
The salient features of Nomination and Remuneration Policy along with the changes made therein are given under Annexure - A to this Report and the detailed policy is available on the website of the Company at https:// www.mandhanaretail.com/investor-relations.php.
14. Risk Management Policy
The Company has an elaborate risk policy defining risk management governance model, risk assessment and prioritisation process. The risk management framework provides an integrated approach for identifying, assessing, mitigating, monitoring and reporting of all risks associated with the business of the Company. Although the Company is not mandatorily required to constitute the Risk Management Committee, but to ensure effective risk management the Board of Directors constituted the Risk Management Committee to monitor and review the key risks and adopt and implement measures to mitigate it.
The Audit Committee has additional oversight in the area of financial risks and controls.
15. Particulars of Loans, Guarantees or Investments
No loans, guarantees or Investments covered under section 186 of the Companies Act, 2013, have been given or provided during the year.
16. Related Party Transactions
All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in ordinary course of business and on arms length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material under Regulation 23 of Listing Regulations. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form No. AOC - 2 is not applicable. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed through the following link: https:// www.mandhanaretail.com/investor-relations.php. Your Directors draw attention of the members to Note No. 35 to the financial statements which sets out related party disclosures including Transaction, if any, with person or entity belonging to the promoter/ promoter group which hold(s) 10% or more shareholding in the Company.
Prior omnibus approval is obtained on an annual basis for transactions with related parties which are of a foreseeable and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all transactions with related parties are placed before the Audit Committee and Board of Directors for their review on periodical basis.
17. Managerial Remuneration
Remuneration to Directors and Key Managerial Personnel i. The percentage increase in remuneration of each Director, Chief Executive Officer and Company Secretary during FY 2018-19 and ratio of the remuneration of each Director to the median remuneration of the employees of the Company for FY 2018-19 are as under:
|Sr. No.||Name of Director /KMP and Designation||Remuneration of Director/ KMP for FY 2018-19 (Rs. in Lakh)||% increase in remuneration in FY 2018-19||Ratio of remuneration of each Whole-Time Director to Median Remuneration of Employees|
|1||Mrs. Sangeeta Mandhana - Managing Director & Chief Financial Officer*||100.15||Nil||44.13|
|2||Mr. Priyavrat Mandhana - Executive Director||100.15||Nil||44.13|
|3||Mr. Sachin Jaju - Non-Executive Director||4.00**||N.A.||N.A.|
|4||Mr. Pradip Dubhashi -||6.25**||N.A.||N.A.|
|Non-Executive Chairman and Independent Director|
|5||Mr. Ramnath Pradeep-||6.50**||N.A.||N.A.|
|Non-Executive and Independent Director|
|6||Mr. Kiran Vaidya -||6.00**||N.A.||N.A.|
|Non-Executive and Independent Director|
|7||Mr. Manish Mandhana - Chief Executive Officer||100.15||Nil||N.A.|
|8||Mr. Virendra Varma - Company Secretary||11.76||Nil||N.A.|
|9||Mr. Hemant Gupta - Chief Financial Officer & Chief Operating Officer@||61.26||N.A.||N.A.|
*Subsequent to the resignation of Mr. Hemant Gupta, the Board of Directors at its meeting held on 16th March, 2019, delegated the additional duty/charge pertaining to the office of the CFO to Mrs. Sangeeta Mandhana, Managing Director of the Company, until the appointment of a suitable candidate for the post of CFO.
@ Mr. Hemant Gupta resigned from the office of CFO & COO of the Company w.e.f. 15th December, 2018.
** Exclusive of taxes.
Note: Remuneration paid to each Whole-Time Director and KMP includes Salary, allowances, companys contribution to provident fund and monetary value of perquisites, if any. The remuneration paid to Non-Executive and/or Independent Directors comprises of sitting fees only.
ii. The median remuneration of employees of the Company during FY 2018-19 was Rs. 2,26,912/- per annum;
iii. In the financial year under review, there was an increase of 6.62% in the median remuneration of employees;
iv. There were 537 permanent employees on the rolls of the Company as on 31st March, 2019 (excluding both the Executive Directors); v. Average percentage increase in the salaries of employees other than the managerial personnel in the last financial year i.e. FY 2018-19 was 5.17% as compared to FY 2017-18. As regards comparison of Managerial Remuneration of FY 2018-19 over FY 2017-18, details of the same are given in the above table at sr. no. (i);
vi. It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in a separate statement and forms part of the Annual Report. Further, this report is being sent to the Members excluding the said statement. The said statement is available for inspection of members at the Registered Office of the Company during working hours upto the date of the Annual General Meeting and shall be made available to any shareholder on request. The said statement is also available on the website of the Company, the weblink to which is https:// www.mandhanaretail.com/.
18. Statutory Auditors and Auditors Report
In accordance with Section 139 of the Companies Act, 2013, M/s. BSR & Co., LLP, Chartered Accountants (Firm RegistrationNumber:101248W/W-100022)were appointed by the shareholders of the Company at the 6th Annual General Meeting held on 20th September, 2017, as the Statutory Auditors for a period of 5 years to hold office until the conclusion of the 11th Annual General Meeting of the Company.
Earlier, proviso to Section 139(1), of the Companies Act, 2013 provided that the appointment of the Statutory Auditors is required to be ratified by the Members at every Annual General Meeting held during their tenure. However, the said proviso was omitted w.e.f. 7th May, 2018 by the Companies Amendment Act, 2017 and thereby the notice for this 8th Annual General Meeting does not include the proposal seeking ratification of the appointment of the Statutory Auditors.
The Auditors Report does not contain any qualification, reservation or adverse remark on the financial statements for the year ended 31st March, 2019. The 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 Companies Act, 2013. The Auditors Report is enclosed with the financial statements in this Annual Report.
There is no incident of fraud requiring reporting by the auditors under Section 143(12) of the Companies Act, 2013.
19. Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Rules made thereunder, the Company has appointed Mr. NitinR. Joshi, Practicing Company Secretary(Certificate of Practice No. 1884 and Membership No. FCS- 3137) as the Secretarial Auditor of the Company. The Secretarial Audit Report is annexed as Annexure - B and forms an integral part of this Report. The Company has complied with all the applicable secretarial standards.
The Secretarial Audit Report does not contain any qualification, reservation or adverse remark. The statements referred in the Secretarial Audit Report are self-explanatory and therefore do not call for any comments under Section 134 of the Companies Act, 2013.
20. Corporate Social Responsibility
A brief outline/salient features of the Companys Corporate Social Responsibility (CSR) Policy and the Annual Report on CSR activities undertaken by the Company as required under Companies (Corporate Social Responsibility Policy) Rules, 2014 is provided in Annexure C forming part of this Report.
21. Subsidiaries, Joint Ventures and Associate Companies
The Company has no subsidiary, Joint Venture and Associate Company as on 31st March, 2019.
22. Significant and Material Orders Passed by the Regulators or Courts or Tribunals Impacting the Going Concern Status and Companys Operations in Future
There are no significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status and the Companys future operations.
23. Adequacy of Internal Financial Controls
The Company has adequate internal financial controls in place with reference to financial statements. These are continually reviewed by the Company to strengthen the same wherever required. The internal control systems are supplemented by internal audit carried out by an independent firm of Chartered Accountants and periodical review by the Management. The Audit Committee of the Board addresses issues raised by both, the Internal Auditors and the Statutory Auditors.
24. Directors Responsibility Statement
Pursuant to the requirements under sub section (3)(c) and (5) of Section 134 of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:
i) in the preparation of the annual accounts for the financial year ended 31st March, 2019, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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/loss of the Company for the year under review;
iii) the Directors have taken proper and sufficient care 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 Directors have prepared the annual financial statements on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
25. Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo
Particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo as per section 134(3)(2) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 for the year ended 31st March, 2019 are provided under Annexure - D to this report.
26. Extract of Annual Return
Pursuant to the provisions of Section 92(1) of the Companies Act, 2013 (Act) as amended by the Companies Amendment Act, 2017, the extract of Annual Return in Form MGT-9 is provided under Annexure E to this Report. Further, pursuant to Section 134(3)(a) of the Act, a copy of the Annual Return is uploaded on the website of the Company and the web link of which is: https://www.mandhanaretail.com/ investor-relations.php
27. Cost Records and Cost Audit
Maintenance of cost records and requirements of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
28. Share Capital
During the year under review, the Members of the Company at its 7th Annual General Meeting (said AGM) held on 25th August, 2018 had approved the increase in the Authorised Share Capital of the Company from Rs. 30,00,00,000/- (Rupees Thirty Crore Only) divided into 3,00,00,000 (Three Crores) equity shares of Rs. 10/- (Rupees Ten Only) each to
Rs. 40,00,00,000/- (Rupees Forty Crore Only) divided into 4,00,00,000 (Four Crores) equity shares of Rs. 10/- (Rupees Ten Only) each and consequently the Memorandum and Articles of Association of the Company were also amended in the said AGM to reflect the increased Authorized Share Capital of the Company.
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. The details relating to deposits, covered under Chapter V of the Act, since neither the Company has accepted deposits during the year under review nor there were any deposits outstanding during the year.
2. Details relating to issue of sweat equity shares, stock options, and shares with differential rights as to dividend, voting or otherwise, since there was no such issue of shares.
3. None of the Whole-Time Directors of the Company received any remuneration or commission from any of its subsidiaries.
Your Directors further state that during the year under review, there were no cases filed under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Directors take this opportunity to thank the Shareholders, Financial Institutions, Banks, Customers, Suppliers, Regulators, Government Authorities - Central and State Government & Local.
The Directors also place on record their appreciation to the employees at all levels for their hard work, dedication and commitment.
|For and on behalf of the Board of Directors|
|The Mandhana Retail Ventures Limited|
|Sangeeta Mandhana||Priyavrat Mandhana|
|Managing Director||Executive Director|
|& Chief Financial Officer||DIN: 02446722|
|Date: 30th May, 2019|