R & B Denims Limited
Your Directors take pleasure in submitting the 13th Annual Report of the Business and operations of your Company and the Audited Financial Statements for the financial year ended 31st March, 2023.
1. FINANCIAL RESULTS & PERFORMANCE
|(Rs. in Lakhs)
|For the year ended 31-03-2023*
|For the year ended 31-03-2022*
|Revenue from operations
|Profit before tax and Exceptional Items
|Profit before Taxation
|-Short Provision for Income Tax expense relating to prior Year
|Net Profit/ (Loss) For The Year
|Other Comprehensive Income for the Year, Net of Tax
|Total Comprehensive Income for the Year
• Figures regrouped wherever necessary
The Company discloses financial results on quarterly basis of which results are subjected to limited review and publishes audited financial results on an annual basis. The Financial Statements as stated above are also available on the Companys website www.rnbdenims.com.
2. STATE OF COMPANYS AFFAIR
During the year, Your Company recorded total revenue of 27,862.40 Lacs against Rs. 29,732.86 Lacs in the previous year, representing a decrease of 6.29% during the year and Profit before Tax Rs. 1,991.73 Lacs as compared to Rs. 2,805.93 Lacs during the year. Total Income during the year Rs. 1,498.64 as compared to Rs. 2,117.10 in the previous year. A detailed analysis on the Companys performance is included in the "Managements Discussion and Analysis" Report, which forms part of this Report.
3. ROAD AHEAD
Our vision of becoming one of the top quality denim manufacturer and moving towards sustainable growth. Our priorities are as follows:
• Focus on increasing production
• Maintaining Price Competitiveness
• Moving up the value chain - Expanding the product line under own brand
We are very excited to enter into the new phase of growth and will continue to invest in our capabilities to increase our presence prudently and create value for the shareholders. We would like to be thankful to the entire stakeholder for being part of the journey.
Keeping in mind the overall performance and outlook for your Company, your Board of Directors recommend that this time the company is not declaring dividends as the company requires funds for its business expansion. Your Directors are unable to recommend any dividend for the year ended 31st March, 2023.
5. UNCLAIMED DIVIDEND
There is no balance lying in unpaid equity dividend account.
6. TRANSFER TO RESERVE
Company has not transferred any amount from profit to General Reserve.
7. MATERIAL CHANGES
There are no Material changes occurred between the end of the financial year of the company to which the financial statements related and the date of the report, which is affecting the financial position of the company.
8. SHARE CAPITAL
The Authorized Share Capital of the Company as on 31/03/2023 was Rs. 25,50,00,000 and Paid up share capital of the Company as on 31/03/2023 was Rs. 13,99,46,880. There has been no such change in the Equity Share Capital of the Company during the year.
During the year, Company has not accepted any deposits from public within the meaning of the Section 73 of the Companies Act, 2013.
10. ANNUAL RETURN
Annual Return Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013, the Annual Return as on the financial year ended March 31, 2023 is placed on the Companys website at https://www.rnbdenims.com/annual-return.html
11. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE
There was no significant material order passed by the regulators or courts or tribunals impacting the going concern status and companys operation in nature.
12. DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with Section 152(6) of the Companies Act, 2013 read with the Articles of Association of the Company, Mr. Amit Dalmia (DIN: 00034642), Whole Time Director, retire by rotation and is being eligible has offered himself for re-appointment at the ensuing Annual General Meeting.
Based on the confirmations received from Directors, none of the Directors are disqualified from appointment under Section 164 of the Companies Act, 2013.
The following are the List of Directors and KMP of the Company during the year:
|Name of Directors
|Category & Designation
|Mr. Rajkumar Borana
|Executive Managing Director
|Mr. Amit Dalmia
|Executive Whole Time Director
|Mr. Deepak Dalmia
|Executive Whole Time Director
|Mr. Ankur Borana
|Executive Whole Time Director
|Mr. Girish Kalawatia
|Non-Executive Independent Director
|Mr. Manaklal Tiwari
|Non-Executive Independent Director
|Mr. Dharmesh Mehta
|Non-Executive Independent Director
|Mrs. Anita Jain *
|Non-Executive Independent Director
|Mr. Parkin K. Jariwala
|Chief Financial Officer
|Mrs. Jyoti Agarwal
* Note: The Term/Tenure of Mrs. Anita Pankaj Jain (DIN: 08010993) as Women Independent Director has been completed on 27th December, 2022. The company appointing her again as an Additional Independent Director and filled-up the vacancy within three months from the date of such vacancy and who shall hold office upto the date of the ensuing general meeting.
13. STATUTORY AUDITORS
M/s. Pradeep K. Singhi & Associates, Chartered Accountants (having Firm Registration No 126027W) are Statutory Auditors of the Company, who were appointed in 10th Annual General Meeting held on 09.09.2019 holds office until the conclusion of the 14th Annual General Meeting.
14. COMMENTS ON AUDITORS REPORT
The notes referred to in the Auditor Report are self-explanatory and they do not call for any further explanation as required under section 134 of the Companies Act, 2013.
15. INTERNAL AUDITOR
M/s. Shivangi Parekh & Co., Chartered Accountant, Surat appointed as an internal Auditor of the Company for the Financial Year 2022-23. Internal Auditors are appointed by the Board of Directors of the Company, based on the recommendation of the Audit Committee. The Internal Auditor reports their findings on the internal Audit of the Company to the Audit Committee on a quarterly basis. The Scope of Internal audit is approved by the Audit Committee.
The Company has appointed M/s. Shivangi Parekh & Co., Chartered Accountant, Surat as an Internal Auditor for F.Y. 2022-23 in the Board meeting held on 8th June, 2021 after obtaining her willingness and eligibility letter for appointment as Internal Auditor of the Company.
16. COST AUDITOR
M/s. V. M. Patel & Associates, Cost Accountant, Surat appointed as a Cost Auditor of the Company for the Financial Year 2022-23 in the Board meeting held on 29th April, 2022 after obtaining his willingness and eligibility letter for appointment as Cost Auditor of the Company.
17. RELATED PARTY TRANSACTION
With reference to Section 134(3)(h) of the Companies Act, 2013, all contracts and arrangements with related parties under section 188 of the Companies Act, 2013 entered by the Company during the financial year, were in ordinary course of business and at arms length basis. Details of the related party transactions made during the year are attached as Annexure-1 in form AOC-2 for your kind perusal and information.
18. NUMBER OF MEETING HELD DURING THE YEAR
The Details of all meeting of Board of Directors and Committee meeting had taken place during the year and their details along with their attendance, is given in Annexure 2 in the Corporate Governance Report.
19. COMPOSITION OF BOARD AND ITS COMMITTEE
The detail of the composition of the Board and its committees thereof and detail of the changes in their composition if any is given in Annexure 2 in the Corporate Governance Report.
20. LOANS, GUARANTEES AND INVESTMENT
With reference to Section 134(3)(g) of the Companies Act, 2013, loans, guarantees and investments made under section 186 of the Companies Act, 2013 form part of the Notes to the financial statements provided in this Annual Report.
21. DECLARATION BY INDEPENDENT DIRECTORS
Company has received declaration from all the independent directors duly signed by them stating that they meet the criteria of independence as provided in section 149(6) of the Companies Act, 2013.
There has been no Change in the circumstances affecting their status as Independent Directors of the Company so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant regulations.
All the independent directors have enrolled with the Indian Institute of Corporate Affairs at Manesar.
SEPARATE MEETING OF INDEPENDENT DIRECTORS
In terms of requirement of Schedule IV of the Companies Act, 2013, the Independent Directors of the company have complied with the code of Independent Director. Independent Directors met separately on 23rd March, 2023 to inter alia review the performance of Non-Independent Directors (Including the Chairman), the entire Board and the quality, quantity and timeliness of the flow of the information between the Management and the Board.
22. VIGIL MECHANISM
The Company has adopted a Whistle Blower Policy to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct or Ethics Policy. The Policy provides for adequate safe guards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company have been denied access to the Audit Committee. The Whistle Blower Policy has been posted on the website of the Company at https://www.rnbdenims.com/investor/polices/VIGIL%20MECHANISM%20FOR%20DIREC TORS%20AND%20EMPLOYEES.pdf?
23. RISK MANAGEMENT
Risks are events, situations or circumstances which may lead to negative consequences on the Companys business. Risk Management is a structured approach to manage uncertainty. An enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework. As a formal rollout, all business divisions and corporate functions will embrace Risk Management Structure, and make use of these in their decision making. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The risk management process over the period of time will become embedded into the Companys business system and processes, such that our responses to risk remain current and dynamic.
24. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your directors hereby confirm:
A. That in preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departments;
B. That the directors have 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 if the Company at the end of the financial year and of the profit and loss of the Company for that period;
C. That 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 for preventing and detecting fraud and other irregulations;
D. That 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.
25. ANNUAL EVALUATION
Pursuant to the applicable provisions of the Act and the Listing Regulations, the Board has carried out an Annual Evaluation of its own performance, performance of the Directors and the working of its Committees based on the evaluation criteria defined by Nomination and Remuneration Committee (NRC) for performance evaluation process of the Board, its Committees and Directors.
The performance evaluation of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as participation in decision making; participation in developing corporate governance; providing advice and suggestion etc.
The Committees of the Board were assessed on the degree of fulfilment of key responsibilities, adequacy of Committee composition and effectiveness of meetings.
The board reviewed the performance of the individual directors on the basis of the criteria such as the contribution in decision making, contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive suggestions and advice in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.
26. INTERNAL FINANCIAL CONTROL SYSTEM
The Company has a well-placed, proper and adequate internal financial control system which ensures that all the assets are safeguarded and protected and that the transactions are authorized recorded and reported correctly. The internal audit covers a wide variety of operational matters and ensures compliance with specific standard with regards to availability and suitability of policies and procedures. During the year no reportable material weakness in the design or operation were observed.
27. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The companies act, 2013 re-emphasizes the need for an effective internal financial control system in the company. Rule 8(5) (viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of internal financial controls with reference to the financial statements to be disclosed in the board report. The detailed report forms part of Independent Auditors Report.
28. CORPORATE GOVERNANCE
Your Company has incorporated the appropriate standards for corporate governance. Company is filing Corporate Governance Report to stock exchange quarterly. Pursuant to Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 company is giving report on corporate governance report in annual report of the company. Corporate Governance Report is as per Annexure - 2.
29. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING
With reference to Section 134(3)(m) of the Companies Act, 2013, the details of conservation of energy, technology absorption and foreign exchange earnings are as per Annexure - 3.
30. CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility) Rules 2014; the Board has undertaken the CSR activities as per Rule 4 of Companies (Corporate Social Responsibility Policy) Rules, 2014. The details of CSR activities for the financial year 2022-23 forms part of this Board report in Annexure - 4.
31. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements), Regulation 2015, the Management Discussion and Analysis Report is given in Annexure - 5.
32. SECRETERIAL AUDITOR
Your board has appointed M/s. Jainam N Shah & Co., Practicing Company Secretary, as secretarial Auditor of the company for the financial year 2022-23. The secretarial report for the financial year 2022-23 is attached as Annexure-6. Report of secretarial auditor is self-explanatory and need not any further clarification.
33. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
There was no employee drawing remuneration in excess of limits prescribed under section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Disclosure pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with Rule of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 are as per Annexure - 7.
34. CEO/ CFO CERTIFICATION
In terms of Regulation 17(8) of the Listing Regulations, the CFO has certified to the Board of Directors of the Company with regard to the financial statements and other matters specified in the said regulation for the financial year 2022-23. The certificate received from CFO is attached herewith as per Annexure - 8.
35. CODE OF CONDUCT
Board of Directors has formulated and adopted Code of Conduct for Board of Directors and Senior Management Personnel. During the year, Board of Directors and Senior Management Personnel has complied with general duties, rules, acts and regulations. In this regard certificate from Managing Directors as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been received by the Board and the same is attached herewith as per Annexure - 9.
Code of Conduct form Board of Directors and Senior Management Personnel is available on below link: https://www.rnbdenims.com/investor/polices/RnB-CoC.pdf?
36. COMPLIANCE CERTIFICATE FROM THE AUDITORS REGARDING COMPLIANCE OF CONDITIONS OF CORPORATEGOVERNANCE:
Corporate Governance is a set of process, practice and system which ensure that the Company is managed in a best interest of stakeholders. The key fundamental principles of corporate governance are transparency and accountability. Companys core business objective is to achieve growth with transparency, accountability and with independency. Company has adopted various corporate governance standard and doing business in ethical way by which Company has enhance stakeholders trust, shareholders wealth creation by improving shares valuation, market capitalization, etc.
A certificate received from M/s Pradeep K. Singhi & Associates, Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance, as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached herewith as per Annexure - 10.
37. CERTIFICATION FROM COMPANY SECRETARY IN PRACTICE
M/s. Jainam N. Shah & Co., Practicing Company Secretary has issued a certificate required under the listing regulations, confirming that none of the Directors on the Board of the company has been debarred or disqualified from being appointed or continuing as director of the company by SEBI/Ministry of Corporate Affairs or any such statutory authority. The certificate is enclosed as Annexure 11.
38. SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES
RB Industries, a partnership firm, is a Subsidiary of the company and a statement providing details of performance and salient features of the financial statements of RB Industries, as per Section 129(3) of the Act, is annexed as "Annexure-12" to this report.
39. SEXUAL HARASSMENT OF WOMEN
There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The objective of this policy is to provide protection against sexual harassment of women at workplace and for redressal of any such complaints of harassment, internal complaints committee has been set up to redress the complaints, if any.
The company has complied with the provisions relating to constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Your directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
40. SECRETARIAL STANDARDS ISSUED BY THE INSTITUTE OF COMPANY SECRETARIES OF INDIA (ICSI)
The Company complies with all applicable mandatory Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).
41. PREVENTION OF INSIDER TRADING
The Company has adopted policy on Preservation of Insider Trading And Code Of Practices And Procedures For Fair Disclosure Of Unpublished Price Sensitive with a view to regulate trading in securities by the Directors and designated employees of the Company. The Policy requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the policy.
The Company has a Prohibition of Insider Trading Policy and the same has been posted on the website of the Company at https://www.rnbdenims.com/investor/polices/Insider%20Trading.pdf?
42. MAINTENANCE OF COST RECORDS
The company is required to maintain Cost Records as specified by Central Government under section 148(1) of the Companies Act, 2013, and accordingly such accounts and records are made and maintained.
43. FRAUD REPORTING
During the year under review, no fraud has been reported by Auditors under Section 143(12) of the Companies Act, 2013.
All the properties and the Insurable Interest of the company Including building and stocks wherever necessary and to the extent required have been adequately insured. The company keeps reviewing the insurance amount every year as per requirement.
45. RESEARCH & DEVELOPMENT
Research and Development is important for businesses because it provides powerful knowledge and insights, leads to improvements to existing processes where efficiency can be increased and costs reduced. It also allows businesses to develop new products and services to allow it to survive and thrive in competitive markets. The benefits of Research & Development extend into entire sectors as well as positively impacting the wider economy. A sector that invests heavily in this will develop and achieve more, including providing real-world benefits to people.
The Company believes that technological obsolescence is a reality. Only progressive research and development will help us to measure up to future challenges and opportunities. We invest in and encourage continuous innovation. During the year under review, expenditure on research and development is not significant in relation to the nature size of operations of Company.
46. STATUTORY INFORMATION
The Company being basically engaged into the manufacturing and whole sell business of Quality Denim Products and is the member of BSE Main Platform. Apart from this business, the Company is not engaged in any other business/activities.
47. CAUTIONARY STATEMENT
Statements in this report and its annexures describing companys projections, expectations and hopes are forward looking. Though, these are based on reasonable assumption, their actual results may differ.
Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment and express their sincere thanks and appreciation to all the employees for their continued contribution, support and co-operation to the operations and performance of the company.
Your Directors would like to express their sincere appreciation of the co-operation and assistance received from Shareholders, Bankers, regulatory bodies and other business constituents during the year under review.
Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, resulting in successful performance of the Company during the year.
For the Board of Director
R & B Denims Limited
|Whole Time Director