Rama Paper Mills Ltd Directors Report.
The Board of Directors hereby submit the report of the business and operations of your company along with the Audited Financial Statements for the financial year ended 31st March, 2019.
Rama Paper Mills Limited ("Your Company") is a leading Indian Newsprint, Duplex Board, Tissue manufacturing Company.
Overview of the Economy
The Global economy disappointed in terms of growth, with deceleration of activity in key emerging and developing economies like China, Brazil, Russia overshadowing a modest recovery in major high income countries. The deceleration was accompanied by declines in commodity prices, subdued global trade, bouts of financial market volatility and weakening capital flows. India was a notable exception, growing at 7.6% as per Central Statistical Office (CSO) estimates, despite declines in exports. Inflation has come down, however industrial activity and consumption has not been buoyant. Three key transitions will influence the global outlook for growth pace of rebalancing in China, commodity prices and monetary policy actions in the US and other major economies. For India, though the long term prospects for continued growth remain undiminished, actual pace will depend on revival in private investment and rural consumption, strengthening of bank balance sheets and continued implementation of economic reforms.
|Profit before Financial Charges &|
|Less: Financial Charges||56,802,674||(112,283,755)|
|Profit before Tax||247,968,365||189,292|
|Add/Less: Deferred Tax|
|Less: Provision for Tax (MAT)||0||0|
|Add: MAT Credit Entitlement||0||0|
|Profit After Tax||247,968,365||189,292|
During the year under review, your Company has earned the Net Profit of Rs. 24,79,68,365 against the Net Profit of Rs.1,89,292 in the previous year, The turnover has also been increased to Rs. 163,02,47,683 against the previous year turnover of Rs.128,80,57,626.
The paid up equity capital of the Company is Rs. 196647330 divided into 9664733 equity shares of Rs. 10 each (It may also be noted that 7581400 Equity Shares of the Company are listed on the Bombay Stock Exchange and are actively traded. Further, 2083333 Equity Shares of the Company are in unlisted form and the Company has applied for the listing of its shares). The Company also has 1000000 Preference Shares of Rs.100 each. The Company has not come out with any issue of securities during the year 2018-19.
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, The Annual Return as on 31st March 2019 is available on your Companys website; www.ramapaper.com
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE
No order has been passed by the regulators or Courts or Tribunals impacting the going concern status and Companys operations in future.
DIVIDEND AND RESERVES
During the year under review, your Company does not recommend any dividend in the absence of profits. And also, your company has not made any transfer to Reserves during the financial year 2018-19.
FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There are no such frauds reported by auditors, which are committed against the company by officers or employees of the company.
MATERIAL CHANGES AND COMMITMENTS AFTER THE DATE OF CLOSE OF FINANCIAL YEAR 2018 19
There are no material changes and commitment affecting the financial position of company after the close of financial year 2018-19 till the date of report.
DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder.
During the financial year 2018-19, the Company did not receive any complaints on sexual harassment and therefore, no complaints remain pending as of 31st March, 2019.
Your Company has not accepted any fixed deposits covered under Chapter V of the Company Act, 2013 and as such, no amount of principal or interest was outstanding on the date of the Balance Sheet.
During the year the Company has not issued any bonus shares.
The Properties and insurable assets and interest of your Company such as buildings, plant & machinery and stocks among others, are adequately insured.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Retirement by Rotation
In accordance with the provisions of Section 152 of Companies Act, 2013 Mr. Gyanveer Singh, Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment.
Appointment / Re-appointment and Cessation of Directors & KMP
During the year under review, Mr. Vijay Pal Singh has been appointed as the Additional Director on the Board of the Company.
Pursuant to the provisions of Section 203 of the Act, your Company has following Key Managerial Personnel(s):
Mr. Nirdesh Agarwal - Chief Financial Officer;
Mr. Himanshu Duggal - Company Secretary;
Mr. Arun Goel - Whole Time Director;
Mr. Pramod Agarwal - Managing Director;
DECLARATION BY THE INDEPENDENT DIRECTORS
All Independent Directors has given declarations to the company confirming that they meet the criteria of independence as laid down under Section 149 (6) of The Companies Act, 2013and Regulation 16(1) (b) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.
COMPOSITION OF COMMITTEES
a) Audit Committee
The present Audit Committee of the board comprises of three members with independent directors forming a majority, namely Mr. Alok Jain as Chairman and Mr. Gyanveer Singh, Ms. Amarjeet Sandhu as members of the Committee. All the recommendations made by the Audit Committee were accepted by the board. Further, the Roles and Responsibility and other related matters of Audit Committee forms an integral part of Corporate Governance Report as part of annual report.
b) Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises of Mr. Alok Jain as chairman, and Mr. Gyanveer Singh, Ms. Amarjeet Sandhu as members, all of whom are Non- Executive Directors. All the recommendations made by the Nomination and Remuneration committee were accepted by the board. Further, the terms of reference and other related matters of Nomination
c) Stakeholder Relationship Committee
Stakeholders Relationship Committee comprises of Ms. Amarjeet Sandhu as Chairman with Mr. Alok Jain, Mr. Gyanveer Singh as members of the Committee. The Committee is set up to monitor the process of share transfer, issue of fresh Share Certificates as well as review of redressed of investors/shareholders grievances. Further, the role and responsibility and other related matters of Stakeholders Relationship Committee forms an integral part of Corporate Governance Report as part of annual report.
Pursuant to provisions of the Companies Act, 2013 and as per applicable provisions of Securities And Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration of the various aspects of the Boards functioning, composition of the Board and its committees, culture, execution and performance of specific duties, obligations and governance.
The performance evaluation of the independent Directors was completed. The performance evaluation of the Chairman and non Independent Directors was carried out by the independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.
NUMBER OF BOARD MEETINGS
The Board duly met at regular intervals to discuss and decide on business strategies/policies and review the financial performance of the company. The notice along with Agenda and notes on agenda of each Board Meeting was given in writing to each Director.
In the Financial Year 2018-19, the Board met Eight (8) times. The interval between two meetings was well within the period mentioned under Section 173 of Companies Act, 2013 and Regulation 17(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The details of Board Meetings held during the Financial Year 2018-19 forms part of the Corporate Governance Report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY COMPANY
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes of financial statements as on 31.03.2019.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, there is no employee in the company, which draws the remuneration in excess of the limits set out in the said rules.
Disclosures pertaining to remuneration and other details of directors & KMP as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are enclosed as Annexure A to this Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134 (3) (m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 are given hereunder:
CONSERVATION OF ENERGY
i) Steps taken or impact on conservation of energy: Energy conservation efforts are ongoing activities. During the year under review further efforts were made to ensure optimum utilization of electricity.
ii) Steps taken by the company for utilizing alternate sources of energy: Since the use of Pet Coke has been banned by the order of Supreme Court and Environmental Authorities, the Company has shifted its energy generation from pet coke basis to Imported coal basis, which has resultant effect in the Cost of Energy.
iii) The Capital investment on energy conservation equipments: During the year under review, the Company has made normal routine maintenance but no capital expenditure has been made.
TECHNOLOGY ABSORPTION, ADAPTION & INNOVATION AND RESEARCH & DEVELOPMENT
No research & development or technical absorption or adaption & innovation taken place in the company during the Financial Year 2018 2019, the details as per rule 8(3) of The companies (Accounts) Rules 2014 are as follows:
i) Efforts made towards technology absorption: - Nil
ii) Benefits derived like product improvement, cost reduction, product development or import substitution: Nil
iii) In case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year)
a. Details of technology imported: Nil
b. Year of Import: Nil
c. Whether the technology been fully absorbed: Nil
d. Areas where absorption has not taken place and the reasons there of: Nil
iv) Expenditure incurred on Research and Development: Nil
FOREIGN EXCHANGE EARNINGS AND OUTGO
As your Company imports waste paper from the various countries owing to its high recovery, therefore the particulars relating to Foreign Exchange Earnings and Outgo are described hereunder.
Foreign Exchange Earnings: NIL Foreign Exchange Outgo: NIL
Your Company has implemented all the stipulations of the Corporate Governance Practices set out by the Securities and Exchange Board of India and as provided in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Separate section on Report of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 form part of the Annual Report.
The requisite certificate from the Company Secretary in Practice regarding compliance of conditions of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached as Annexure B of the Directors Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(5) of the Act, the directors hereby confirm that:
a) In the preparation of the Annual Accounts for the year ended 31st March, 2019 the applicable accounting standards have been followed along with proper explanations relating to material departure.
b) Appropriate accounting policies have been selected and applied consistently and judgments 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 31st March, 2019.
c) Proper and sufficient care has been taken for the maintenance of accounting records in accordance with the Provisions of the Companies Act, 2013. They further confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) The financial statements have been prepared on a going concern basis.
e) That the Director had laid down internal financial controls to be followed by Company and such internal Controls are adequate and were operating effectively; and
f) That the Directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.
MANAGEMENTS DISCUSSION AND ANALYSIS REPORT
Managements Discussion and Analysis Report for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is presented in a separate section forming Annexure C of the Directors Report
AUDITORS AND AUDITORS REPORT
M/s Bajaj Arora & Co., Chartered Accountants Statutory Auditors of your Company, retire at the forthcoming Annual General Meeting and are eligible for re-appointment. They have confirmed their eligibility for reappointment under the provisions of Section 139(1) of Companies Act, 2013.
The Company has received a certificate from the auditors to the effect that their appointment, if made, would be within the limits prescribed under the Companies Act, 2013, and they are not disqualified for appointment, as per the provisions of section 141 of the Companies Act, 2013.
The auditor report and notes on accounts referred to in the Auditors Report is self-explanatory and there are no adverse remarks or qualification in the Report.
As per requirement of Central Government and pursuant to section148 of Companies Act 2013 read with the Companies (Cost records and Audit) Rules, 2014 as amended from time to time, your Company has been carrying out audit of Cost records relating to the Company.
The Board of Directors on the recommendation of the Audit Committee has appointed M/s. Jain Sharma & Company, Cost Accountants as the Cost Auditor of the Company for the Financial Year 2018-19. As it requires under the Companies Act 2013, a resolution seeking members approval for the remuneration payable to the Cost Auditor forms part of the Notice convening Annual General Meeting.
Pursuant to the provisions of the Section 204 of the Companies Act 2013 and rules made thereunder, the Board has appointed Ms. Sameer Kishore Bhatnagar, Company Secretary in Practice to conduct the Secretarial Audit of the Company for the Financial Year 2018-19. The Secretarial Audit Report for the Financial Year is attached herewith as Annexure D which forms integral part of this report.
The Secretarial Audit report does not contain any qualification, reservation or adverse remark. Internal Auditor
As per requirements of Section 138 of Companies Act, 2013 read with Rule 13 of Companies (Accounts) Rules 2014, The Board of Directors on the recommendation of the Audit Committee appointed M/s. GR &Company, Chartered Accountants, as the Internal Auditor of the Company for the Financial Year 2018-19.
Internal Control System And Their Adequacy
Your Company has an effective internal Control and risk mitigation system, which are constantly assessed risk mitigation system, which are constantly assessed and strengthened with new/revised standards operating procedures. The Companys internal Control System is commensurate with its size, scale and complexities of its operations.
The Audit Committee of the Board of directors actively reviews the adequacy and effectiveness of the internal control system and suggests improvements to strengthen the same. The company has a robust Management information system, which is an integral part of the control mechanism.
The Audit Committee of the Board of Directors, Statuary Auditors and the Business heads are periodically apprised of the internal Audit findings and Corrective actions taken. Audit plays a key role in providing assurance to the Board of Directors. Significant Audit observation and corrective actions taken by the management are presented to Audit Committee of the Board. To maintain its objectivity and independence, the internal Audit function reports to the Chairman of the Audit Committee.
The risk management framework defines the risk management approach of the Company and includes periodic review of such risks and also documentation, mitigating controls and reporting mechanism of all risks.
During the year under review, the senior officials of the Company performs the task of risk management to identify and evaluate elements of business risk. Consequently a revised robust Business Risk Management framework is in place. The risk management framework defines the risk management approach of the Company and includes periodic review of such risk and also documentation, mitigation control and reporting mechanism of such Risk.
Details of Subsidiary Companies, Joint Ventures and Associate Company, and their Financial Position
There is no subsidiary, Associate and joint venture of the company and further there are no companies, which have become or ceased to be the subsidiary and joint venture of the company during the year.
LISTING OF SECURITIES
The Companys Equity Shares are listed on Bombay Stock Exchange.
PAYMENT OF LISTING FEES
The Listing fees for the year 2019-20 has not been paid by the Company. However, the board of directors of your Company undertakes to pay the same at the earliest.
RELATED PARTY TRANSACTIONS
All the related party transactions are entered on arms length basis and are in compliance with the applicable provisions of the Act and the Listing Agreement. There are no materially significant related party transactions made by the company with Promoters, Directors or Key Managerial Personnel etc. which may have potential conflict with the interest of the company at large. All Related Party Transactions are presented to the Audit committee. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of related party transactions was presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions. All the contracts/arrangements/transactions entered with related party for the year under review were on Arms Length basis. Company has entered into material related party transactions during the year under review. Further disclosure in Form AOC-2 is as attached as Annexure E.
The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company (www.ramapaper.com).
POLICIES & DISCLOSURES
Your Company has established Vigil Mechanism for directors and employees to report concerns about unethical behavior, actual or suspected, fraud or violation of the Companys code of conduct or ethics policy and provides safeguard against victimization of employees who avail the mechanism. The policy permits all the directors and employees to report their concerns directly to the Chairman of the Audit Committee of the Company.
The Vigil Mechanism/Whistle blower Policy of the company provides that protected disclosures can be made by a whistle blower through an email to the Chairman of the audit committee. The Whistle Blower Policy can be accessed on the Companys Website (www.ramapaper.com). This disclosure also forms part of the Corporate Governance Report as per applicable provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
NOMINATION AND REMUNERATION POLICY
The nomination and remuneration committee has recommended to the Board:
A policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. The details of this policy are attached as Annexure F to this report and
Further, Policy for selection criteria of Directors and Senior Management and Criteria for determining qualifications, positive attributes and director independence is also attached as Annexure G to this Report. The Remuneration and Nomination Policy has also been posted on the website of the Company (www.ramapaper.com).
CORPORATE SOCIAL RESPONSIBILITY
Pursuant to Section 135 of the Companies Act, 2013 and rules made there under, every company having net worth of Rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year shall constitute a Corporate Social Responsibility Committee of the Board.
However, it is not applicable in case of your Company. Hence there is no need to form Corporate Social Responsibility Committee and Corporate Social Responsibility Policy for the company as per the requirement of the Companies Act, 2013.
FAMILIARIZATION PROGRAMME AND TRAINING OF INDEPENDENT DIRECTORS
The details of programmes for familiarization of Independent Directors with the company, their roles and responsibilities in the company, business model of the company and other related matter are updated on the website of the Company (www.ramapaper.com).
To familiarize the new inductees as independent director with the strategy, operations and functions of our Company, the executive directors make presentations to the inductees about the Companys organization structure, finance, human resources, facilities and risk management.
Further, at the time of appointment of an independent director, the Company issues a formal letter of appointment outlining his/her role, function, duties and responsibilities as a director. The Formal format of the letter of appointment is available on our website.
POLICY FOR PRESERVATION OF DOCUMENTS
In terms of applicable provisions of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Company have incorporated policy for preservation of documents as specified in the Regulation.
Policy on Materiality of Related Party Transactions
In terms of Regulation 23(1) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Company have incorporated policy to determine materiality of Related Party Transactions as specified in the Regulation.
RISK MANAGEMENT POLICY
Enterprise Risk Management is a risk based approach to manage an enterprise, identifying events that may affect the entity and manage risks to provide reasonable assurance regarding achievement of entitys objective. The risks identified by the Company broadly fall into the following categories viz. strategic risks, operational risks, regulatory risks, financial and accounting risks, foreign currency and other treasury related risks and information systems risks. The risk management process consists of risk identification, risk assessment, risk prioritization, risk treatment or mitigation, risk monitoring and documenting the new risks. Your Board has laid down a risk management framework and policy to address the above risks. The objective of the policy is to identify existing & emerging challenges that may adversely affect the Company and manage risks in order to provide reasonable assurance to the various stakeholders. In the opinion of your Board, none of the risks which have been identified may threaten the existence of the Company.
Your Director states 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:-
a) Details relating to deposits covered under Chapter V of the Act.
b) Issue of the equity shares with differential rights as to dividend, voting or otherwise.
c) Issue of shares (including sweat equity shares) to directors or employees of the Company
d) Issue of Employee Stock Option Scheme to employees of the company
e) There is no subsidiary, Associate and joint venture of the company and further there are no companies, which have become or ceased to be the subsidiary and joint venture of the company during the year.
f) No significant or material orders were passed by the regulators or courts or tribunals, which impact the going concern status and Companys operations in future.
g) Purchase of or subscription for shares in the company by the employees of the company.
h) There is no material subsidiary of company, so no policy on material subsidiary is required to be adopted.
Your Directors further state that:-
a) The Company has zero tolerance for sexual harassment and during the year under review, there were no complaint received and no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
b) And there is no change in the nature of business of company during the year.
Your Directors take this opportunity to place on record their appreciation for the shareholders, bankers and other business associates for their forbearance, understanding and support to the Company. They also wish to place on record their great appreciation of the commitment, sense of involvement and dedication exhibited by each staff member in the overall development, growth and prosperity of the company.
|Place: Kiratpur||BY ORDER OF THE BOARD|
|Date: 03.09.2019||FOR RAMA PAPER MILLS LIMITED|
|PRAMOD AGARWAL||ARUN GOEL|
|MANAGING DIRECTOR||EXECUTIVE DIRECTOR|
|DIN: 00038838||DIN: 00035058|