Shree Rama Newsprint Ltd Directors Report.

To

The Members of

SHREE RAMA NEWSPRINT LIMITED

Your Directors are pleased to present the 28th Annual Report together with the Audited Accounts for the Financial Year ended on 31st March 2019.

FINANCIAL RESULTS:

Amount (Rs. in Lakhs)

PARTICULARS Year Ended 31-03-2019 Year Ended 31-03-2018
Revenue from operations 50382.76 43434.46
Other Income 170.39 585.82
Profit/(Loss) before Interest, Depreciation and Tax 9014.18 1579.54
Finance Cost 2864.61 2475.09
Profit/(Loss) before Depreciation and Tax 6149.57 (895.55)
Depreciation 2326.83 2298.82
Profit /(Loss) before Tax and exceptional items 3822.74 (3194.37)
Deferred tax (assets)/liabilities - (203.01)
Other comprehensive income (17.98) 16.02
Net Profit/Loss after other comprehensive income 3804.76 (2975.34)

PERFORMANCE:

The Company has achieved production of 1,24,814 tons (95% capacity utilization) during the F.Y. 2018-19 as against 1,19,267 tons (90% capacity utilization ) achieved in FY 2017-18 i.e. higher by 5547 tons (5%). The Company has achieved sale of 1,10,497 tons during FY 2018-19 as against 1, 21,301 tons during FY 2017-18. During the year under review, the Company has also produced Writing & printing paper of 465 MT as against no such production in the previous year.

The Company has achieved turnover of Rs.503.83 crores in FY 2018-19 as against Rs.434.34 crores [with excise duty till June. 17] in FY 2017-18.

The working results of the Company were satisfactory as cash profit before depreciation and tax was Rs.61.50 crores in FY 2018-19 as against cash loss before depreciation and tax Rs.8.96 crores in FY 2017-18 due to increased sales realization.

The Net Profit was of Rs.38.05 crores in FY 2018-19 as against Net Loss of Rs.29.75 crores in FY 2017-18.

EXPORT:

Export in Foreign exchange of Newsprint was 2511 tons worth 12.34 crores (FOB) in F.Y. 2018-19 as against 2215 tons worth Rs.7.83 crores (FOB) in F.Y. 2017-18 , whereas direct and indirect export was of 2858 tons worth Rs.14.59 crores in F.Y. 2018-19 as against 3049 tons worth Rs.10.97 crores in F.Y. 2017-18

DIVIDEND:

Your Directors has not recommended any dividend for the year under review due to accumulated losses.

SHARE CAPITAL:

The paid up Equity Share Capital as at 31st March, 2019 stood at Rs.147,52,20,320/-. During the year under review, the Company has neither issued shares or convertible securities nor shares with differential voting rights not has granted any stock options or sweat equity or warrants.

TRANSFER TO RESERVES:

The Board of Directors of your Company, has decided not to transfer any amount to the Reserves for the year under review.

THE CHANGE IN NATURE OF BUSINESS:

There are no material changes and commitments, that would affect financial position of the Company from the end of the financial year of the Company to which the financial statements relate and the date of the directors report.

FINANCES:

The Company has repaid term loan of Rs.12.61 crores to ICICI Bank Ltd. during the year The Inter Corporate Deposit from holding company (i.e. Riddhi Siddhi Gluco Biols Ltd) has increased from Rs.78.17 crores as on 31.03.18 to Rs.143.75 crores as on 31.03.2019.

PACKAGED WATER BOTTLING PLANT:

We have taken packaged water bottling plant of 32000 bottles per hour and orders were placed on 27.11.2017 with Sure Technologies FZC Sharjah UAE. The trial production has started on 07.05.2019 .

DEPOSIT:

The Company has not accepted or renewed any deposit during the year and there is no outstanding on this account in books of the Company.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company does not have any joint venture, subsidiary or associate company within the meaning of Section 2(6) of the Companies Act, 2013.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return as on 31.03.2019 in form MGT-9 is annexed herewith as Annexure I.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:

The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. However details of investment made by the Company are mentioned in the financial statement of the Company.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The Company has not entered into any related party transactions as enumerated in Section 188 of the Company Act, 2013 during the year and disclosed the said information in Form AOC-2 and attached as Annexure – II.

NUMBER OF MEETINGS OF THE BOARD:

During the year, four Board Meetings were convened and held and details thereof are mentioned in the Report on Corporate Governance forming part of this Annual Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Mrs. Kavita Patel (DIN: 07671628) resigned as an independent director of the company on 15.11. 2018. The Company expresses sincere gratitude to her for the contribution made during her tenure as Director of the Company. Mrs. Meenu Singhvi (DIN: 08273316) was appointed as an additional director in independent category on 03.11. 2018. Company propose to appoint Mrs. Meenu Singhvi as an Independent Director for a period of 5 years subject to the approval of members of the Company by Ordinary Resolution. In the said Board Meeting it is proposed to reappoint Mr. Siddharth G. Chowdhary (DIN: 01798350), as a Whole Time Director of the Company for the period of 3 years as mentioned in the propose resolution mentioned in notice.

Shri Ganpatraj L. Chowdhary (DIN: 00344816) retires from the office by rotation but being eligible offers himself for re-appointment. The brief resume of the Director proposed to be appointed/reappointed, nature of his/her expertise in specific functional areas, names of Companies in which he/she holds Directorships and Memberships of Board Committees, shareholding, are provided in the Notice to Members as per regulation 36 (3) the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms a part of this Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT PURSUANT TO SECTION 134(3)(c) OF THE COMPANIES ACT, 2013:

The Directors hereby confirm that: -

1. in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

2. 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;

3. 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;

4. the Directors had prepared the annual accounts on a going concern basis;

5. the Directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

6. 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.

STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:

Pursuant to Section 149(6) of the Companies Act, 2013, Independent Directors of the Company have made a declaration confirming the compliance of the conditions of the independence stipulated in the aforesaid section.

DETAILS OF COMMITTEE OF DIRECTORS:

The Composition of Audit Committee of Directors, Nomination and Remuneration Committee of Directors and Stake Holders Relationship/ Grievances Committee of Directors, number of meetings held of each Committee during the financial year 2018-19 and meetings attended by each member of the Committee as required under the Companies Act, 2013 are provided in Corporate Governance Report.

ANNUAL EVALUATION BY THE BOARD OF ITS OWN PERFORMANCE, ITS COMMITTEES AND INDIVIDUAL DIRECTORS:

The Company has devised a Policy for performance evaluation of the Board, Committees and other individual Directors (including Independent Directors) which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors. The evaluation process inter alia considers attendance of Directors at Board and committee meetings, acquaintance with business, communicating inter-se board members, effective participation, domain knowledge, compliance with code of conduct, vision and strategy, benchmarks established by global peers, etc, which is in compliance with applicable laws, regulations and guidelines. The Board carried out annual performance evaluation of the Board, Board Committees and Individual Directors and Chairman. The Chairman of the respective Board Committees shared the report on evaluation with the respective Committee members. The performance of each Committee was evaluated by the Board, based on report on evaluation received from respective Board Committees.

The reports on performance evaluation of the Individual Directors were reviewed by the Chairman of the Board.

In compliance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, the performance evaluation was carried out as under Board:

BOARD:

In accordance with the criteria suggested by The Nomination and Remuneration Committee, the Board of Directors evaluated the performance of the Board, having regard to various criteria such as Board composition, Board processes, Board dynamics etc. The Independent Directors, at their separate meetings, also evaluated the performance of the Board as a whole based on various criteria specified by Companies Act, 2013. The Board and the Independent Directors were of the unanimous view that performance of the Board of Directors as a whole was satisfactory.

COMMITTEES OF THE BOARD:>

The performance of the Audit Committee, the Nomination and Remuneration Committee and the Stakeholders Relationship Committee was evaluated by the Board having regard to various criteria such as committee composition, committee processes, committee dynamics etc. The Board was of the unanimous view that all the committees were performing their functions satisfactorily and according to the mandate prescribed by the Board under the regulatory requirements including the provisions of the Act, the Rules framed thereunder and the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015.

INDIVIDUAL DIRECTORS:

Independent Directors:

In accordance with the criteria suggested by the Nomination and Remuneration Committee, the performance of each independent director was evaluated by the entire Board of Directors (excluding the director being evaluated) on various parameters like engagement, leadership, analysis, decision making, communication, governance and interest of stakeholders. The Board was of the unanimous view that each independent director was a reputed professional and brought his/her rich experience to the deliberations of the Board. The Board also appreciated the contribution made by all the independent directors in guiding the management in achieving higher growth and concluded that continuance of each independent director on the Board will be in the interest of the Company.

NON-INDEPENDENT DIRECTORS:

The performance of each of the non-independent directors (including the Chairperson) was evaluated by the Independent Directors at their separate meeting. Further, their performance was also evaluated by the Board of Directors. The various criteria considered for the purpose of evaluation included leadership, engagement, transparency, analysis, decision making, functional knowledge, governance and interest of stakeholders. The Independent Directors and the Board were of the unanimous view that each of the non-independent directors was providing good business and people leadership.

Confirm that, independent directors have complied with the Code for independent directors prescribed in Schedule IV to the Act. Further confirm that, necessary declaration with respect to independence has been received from all the independent directors of the Company.

INTERNAL CONTROL SYSTEMS:

The Company has an adequate system of internal control procedures which is commensurate with the size and nature of business. Detailed procedural manuals are in place to ensure that all the assets are safeguarded, protected against loss and all transactions are authorised, recorded and reported correctly. The internal control systems of the Company are monitored and evaluated by internal auditors and their audit reports are periodically reviewed by the Audit Committee of the Board of Directors.

APPOINTMENT AND REMUNERATION POLICY:

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration which is available on Companys website at www.ramanewsprint.com. Mr. Siddharth G. Chowdhary draws remuneration from holding Company as an executive director as per resolution passed by the shareholders of Riddhi Siddhi Gluco Biols Limited.

WHISTLE BLOWER POLICY:

The Company has formulated a Whistle Blower Policy to establish a vigil mechanism for Directors, Employees and other Stakeholders of the Company to report concerns about illegal and unethical practices, unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or Ethics Policy which is available at the Companys website atwww.ramanewsprint.com.

ADOPTION OF POLICES AS PER THE SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015:

The Board framed policies on Preservation of Documents and Determining Materiality for Disclosure to Stock Exchanges which are available at the Companys website at www.ramanewsprint.com

RISK MANAGEMENT:

During the year, the Management of the Company had evaluated the existing Risk Management Policy of the Company. The Risk Management policy has been reviewed and found adequate and sufficient to the requirement of the Company. The Management has evaluated various risks and that there is no element of risk identified that may threaten the existence of the Company.

LISTING OF SHARES:

Equity Shares of Company continue to be listed on BSE Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The Company has duly paid listing fees to the stock exchanges.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Particulars with respect to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required u/s 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 are furnished as Annexure – III to this Report and forms part of it.

CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION &ANALYSIS:

Report on Corporate Governance and Management Discussion and Analysis is made part of this Annual Report.

As required by the Listing Agreements, the Certificate of Practicing Company Secretary on Corporate Governance compliance is also annexed to this Annual Report.

The Certificates from Chief Executive Officer and Chief Financial Officer were placed before the Board of Directors at its meeting held on 30.05.2019.

PARTICULARS OF EMPLOYEES:

The information as per section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and remuneration of managerial personnel) Rules, 2014 are as per Annexure-IV.

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014, the Board on the recommendations of the Audit Committee, has appointed M/r. Ravi Kapoor a sole proprietor M/s. Ravi Kapoor & Associates Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year ended 31st March, 2019. Secretarial Audit Report issued by them, in form MR-3 forms part of this report and marked as Annexure-V.

COST AUDIT:

The audit of cost accounts of the Company is being carried out by M/s Nanty Shah and Associates for FY 2018-19 and after completion of the audit they will submit their report to the Central Government.

CASH FLOW STATEMENT:

As required under clause 34 of the Securities And Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Cash Flow Statement is attached to the Annual report.

AUDITORS:

Batliboi & Purohit, Chartered Accountants were appointed as Auditors of the Company, for a term of 5 (five) consecutive years in the Annual General Meeting held on 23rd September 2017, subject to ratification at every Annual General Meeting.

However, Ministry of Corporate affairs, vide its notification dated 7th May, 2018 amended provisions of Rule 3(7) of Companies (Audit and Auditors) Rules, 2014 and accordingly, provisions of requirement of ratification of appointment of Auditor at every General Meeting is dispensed with. Therefore, at the ensuing General Meeting, members are not required to ratify Auditors appointment and M/s. Batliboi & Purohit, Chartered Accountants will continue to act as Auditors of the Company till conclusion of Annual General Meeting held for financial year 2021-22.

EXPLANATIONS OR COMMENTS BY BOARD ON EVERY QUALIFICATION, RESERVATION OR ADVERSE REMARK OR DISCLAIMER MADE:

(i) by the Auditor in his report;

There is no qualification, reservation or adverse remark or disclaimer in audit report issued by the Auditors of the Company.

(ii) By the Company Secretary in Practice in his Secretarial Audit Report;

There is no qualification, reservation or adverse remark or disclaimer in secretarial audit report issued by the Company Secretary in Practice.

CORPORATE SOCIAL RESPONSIBILITY:

The Company is not required to form Corporate Social Responsibility committee or policy as per section 135 (1) of the Companies Act 2013 since the same is not applicable to it as per criterion laid down therein. However the Company is meeting its social obligations for local persons by providing heath facilities including distribution of free medicines. It also supplies free drinking water to nearby villages. The Company is also running a modern English medium school for imparting quality education to local persons and undertakes various community welfare jobs from time to time.

The Company is also maintaining colony for workers & staff which has all the modern amenities.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

In terms of Section 134(3)(i) of the Companies Act, 2013, it is reported that, except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and date of this report

REPORTING OF FRAUD:

There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and/or Board under section 143(12) of Act and Rules framed thereunder.

COMPLIANCE WITH SECRETARIAL STANDARDS:

Your Directors confirm that, Company complies with applicable mandatory Secretarial Standards issued by The Institute of Company Secretaries of India.

SIGNIFICANT AND MATERIAL ORDERS:

There are no material orders passed by Regulators, Courts or Tribunals affecting the going concern status and companys operations in future.

INDUSTRIAL RELATIONS:

The industrial relations remained cordial throughout the year under review.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:

The Board has developed the Sexual Harassment Policy of the Company for safety of the women employees employed in the Company. Further no complaint / case have been filed / pending with the Company during the year.

ACKNOWLEDGEMENT:

The Directors wish to place on record and acknowledge their appreciation and gratitude for the continued co-operation and support received from the Union Government, the State Government of Gujarat, Regulatory Bodies, participating Financial Institutions and Banks, Customers, Suppliers and Dealers. The Directors take this opportunity to express their appreciation towards the dedication, commitment and teamwork shown by employees, which has resulted in improved working results. Your Directors further thank Members/Shareholders for their continued confidence reposed in the Management of the Company.

For, Shree Rama Newsprint Limited
(Ganpatraj L. Chowdhary)
Place : Ahmedabad CHAIRMAN
Date : 30.05.2019 DIN: 00344816