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Your directors have pleasure in presenting the 36th Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 31st March, 2019.
1. FINANCIAL SUMMARY:
Your Company s performance during the year ended 31st March, 2019, as compared to the previous financial year, is summarized as below: (Rs. In Lakhs)
|PARTICULARS||Financial Year 2018-19||Financial Year 2017-18|
|Revenue from operation||2741.44||2375.47|
|Profit/(Loss) before Interest, Depreciation and Tax||(200.72)||(16.20)|
|Net Profit / Loss Before Tax (PBT)||(360.09)||(159.21)|
|Provision for Tax||-||-|
|Provision for earlier years||-||-|
|Net Profit (PAT)||(361.44)||(161.86)|
2. TRANSFER TO RESERVES
The Company did not transfer any amount to the General Reserve for the Financial Year ended March 31, 2019.
3. SHARE CAPITAL
During the year, Company has allotted 43,25,000 equity shares to the promoters and non-promoters. The paid-up equity share capital of the Company has been increased from Rs. 11,27,51,000 to Rs. 15,60,01,000 /-. During the year under review, the Company has not issued shares with differential voting rights, sweat equity shares or Employee Stock Options.
On account of the losses, your Directors do not recommend any dividend for the year ended 31st March, 2019
. 5. DIRECTORS & KEY MANAGERIAL PERSONAL:
In accordance with the provisions of Section 152 of the Companies Act, 2013 Shri. Pemmasani Ravichandra (DIN: 00627413), Director retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. The Board recommends his reappointment for the consideration of the members of the company at the forthcoming annual general meeting. Brief details of Shri. Pemmasani Ravichandra has been mentioned in the notice convening the Annual General Meeting at "Information pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/ Re-appointment of Directors". The tenure of Shri. Pemmasani Veeranarayana (DIN: 00644259), Managing Director expired on 4th March, 2019. Taking in to consideration of his rich experience and contribution to the Company, and pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, subject to the approval of the members at the ensuing Annual General Meeting, passed a resolution on 14th February, 2019, approving the reappointment of Shri. Pemmasani Veeranarayana (DIN: 00644259) as Managing Director of the Company for a further period of three years with effect from 5th March, 2019 to 4th March, 2022. The tenure of Shri. Pemmasani Madhu Pratap (DIN: 00644254), Whole-Time Director expired on 31st July, 2019. Taking in to consideration of his rich experience and contribution to the Company, and pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors of the Company, subject to the approval of the members at the ensuing Annual General Meeting, passed a resolution on 30th May, 2019, approving the reappointment of Shri. Pemmasani Madhu Pratap (DIN: 00644254) as Whole-Time Director of the Company for a further period of three years with effect from 01st August, 2019 to 31st July, 2022. In accordance with the provisions of Section 152, 160 and other applicable provisions of the Companies Act, 2013, Shri. Narayana Yadla (DIN: 02596053) who was appointed as the Additional Director of the company on 14th November, 2018 and whose term of office expires at the ensuing Annual General Meeting, being eligible offers himself for appointment. The Nomination and remuneration Committee and the Board of Directors of the company recommends his appointment as the Independent Director of the company at the ensuing annual general meeting. Brief details of
Shri. Narayana Yadla (DIN: 02596053) has been mentioned in the notice convening the Annual General Meeting at "Information pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/ Re-appointment of Directors".
In accordance with the provisions of Section 152, 160 and other applicable provisions of the Companies Act, 2013, Shri. Rajesh Katragadda (DIN: 02727491) and whose term of office expires at the ensuing Annual General Meeting, being eligible offers himself for appointment. The Nomination and remuneration Committee and the Board of Directors of the company recommends his appointment as the Independent Director of the company at the ensuing annual general meeting. Brief details of Shri. Rajesh Katragadda (DIN: 02727491) has been mentioned in the notice convening the Annual General Meeting at "Information pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/ Re-appointment of Directors".
6. DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each Independent director under 149(7) of the Companies Act, 2013, that he/she meets the criteria of Independence laid down under section 149(6) of the Companies Act 2013.
7. MEETINGS OF THE BOARD
The Board met Seven times during the financial year 2018-19 viz., on 04.04.2018, 28.05.2018, 13.08.2018, 14.11.2018, 09.01.2019, 14.02.2019 and 27.03.2019. The maximum interval between any two meetings did not exceed 120 days.
8. STATUTORY AUDITORS:
In terms of Section 139 of the Companies Act, 2013 ("the Act"), and the Companies (Audit and Auditors) Rules, 2014, made thereunder, the term of the present Statutory Auditors of the Company, M/s. SPC & Associates, Chartered Accountants will be expiring at the conclusion of the 36th Annual General Meeting of the Company. The Board of Directors had at its meeting held on 14th August, 2019, upon the recommendation of Audit Committee have appointed of M/s. M M G S & Associates (Firm Registration No: 010613S), Chartered Accountants, as the Statutory Auditors of the Company to hold office from the conclusion of the thirty sixth Annual General Meeting until the conclusion of the forty-first Annual General Meeting. M/s. M M G S & Associates, Chartered Accountants, Hyderabad, have confirmed that the appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013. Accordingly, the appointment of M/s M M G S & Associates, Chartered Accountants, Hyderabad, as the Statutory Auditors, is being proposed as an Ordinary Resolution. The financial statements have been audited by M/s. SPC & Associates, Chartered Accountants, Statutory Auditors of the Company. The Board would like to place on record its appreciation to M/s. SPC & Associates, Chartered Accountants, for giving their valuable insights and suggestions for the past five years, and also wishes them all success in their endeavours.
9. AUDITORS REPORT
There are no qualifications, reservations or adverse remarks made by M/s. SPC & Associates., Chartered Accountants, Statutory Auditors in their report for the Financial Year ended 31st March, 2019. The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under sub-section (12) of section 143 of the Companies Act, 2013, during the year under review.
10. INTERNAL AUDITORS:
The Board of Directors based on the recommendation of the Audit Committee has appointed M/s. Y C Narayana & Co., Chartered Accountants, Vijayawada, as the Internal Auditors of your Company. The Internal Auditors are submitting their reports on quarterly basis.
11. SECRETARIAL AUDITORS:
M/s. P. S. Rao & Associates, Practicing Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2018-19, as required under Section 204 of the Companies Act, 2013 and Rule 9 there-under. The secretarial audit report for F.Y. 2018-19 forms part of this Report as Annexure- I. 12. SECRETARIAL AUDIT REPORT
There are no qualifications, reservations or adverse remarks made by M/s. P. S. Rao & Associates, Practicing Company Secretaries in their report for the Financial Year ended 31st March, 2019 except those stated below: Qualification: There was a delay in appointment of Company Secretary pursuant to the provisions of Section 203 of the Companies read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 6 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Reply: Despite the best efforts the management of the company was unable to appoint a Company Secretary within the time limits as prescribed under Section 203 of the Companies Act, 2013.
13. RISK MANAGEMENT POLICY
The Company has developed and implementing a risk management policy which includes the identification therein of elements of risk, which in the opinion of the board may threaten the existence of the Company.
14. CORPORATE SOCIAL RESPONSIBILITY (CSR):
The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.
15. COMPOSITION OF AUDIT COMMITTEE:
The Audit Committee of the Company comprises the following Members
|Shri. Y Narayana||-||Member|
|Shri. K Rajesh||-||Member|
|Shri. A.R. Chowdary||-||Member (upto 31.03.2019)|
|Shri. P. Sugunamma||-||Member|
All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.
16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO:
Information required under section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure- II.
17. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES
One of the key functions of the Board is to monitor and review the board evaluation framework. The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive / non-executive / independent directors through a peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships, information flow, decision-making of the directors, relationship to stakeholders, company performance, company strategy, and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each director is encouraged to be provided as part of the survey. Independent directors have three key roles governance, control and guidance. Some of the performance indicators based on which the independent directors are evaluated include: Ability to contribute by introducing international best practices to address top-management issues Active participation in long-term strategic planning Commitment to the fulfillment of a directors obligations and fiduciary responsibilities; these include participation in Board and committee meetings. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.
18. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:
The Company has in place an Internal Control System, commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.
The Company has no subsidiaries as on 31st March, 2019.
20. NOMINATION AND REMUENRATION POLICY:
A committee of the Board named as "Nomination and Remuneration Committee" has been constituted to comply with the provisions of section 178 of Companies Act, 2013 and to recommend a policy of the Company on directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters and to frame proper systems for identification, appointment of Directors & KMPs, Payment of Remuneration to them and Evaluation of their performance and to recommend the same to the Board from time to time. The policy is also posted in the investors section of the company s website.
21. FIXED DEPOSITS:
Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.
22. PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS:
Details of the Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, if any, are given in the notes to the financial statements pertaining to the year under review.
23. POLICY ON SEXUAL HARASSMENT:
The company has adopted policy on prevention of sexual harassment of women at workplace in accordance with The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the financial year ended March 31, 2019, the company has not received any complaints pertaining to sexual harassment.
24. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to Section 134 (5) of the Companies Act, 2013 Your Directors confirm that:
i) In preparation of 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 are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March, 2019 and of the profit and loss of the Company for the year;
iii) The Directors have taken proper and sufficient care for their maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) The Directors had prepared the annual accounts on a going concern basis;
v) 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; and
vi) 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. VIGIL MECHANISM:
The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement, if any in the Company. The details of the Policy are posted on the website of the Company www.sibarauto.com
26. RELATED PARTY TRANSACTIONS:
Related party transactions entered during the financial year under review are disclosed in Note No.34 of the Financial Statements of the Company for the financial year ended 31st March, 2019. These transactions entered were at an arm s length basis and in the ordinary course of business. There were no materially significant related party transactions with the Company s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure III. The Policy on the Related Party Transactions as approved by the Board is uploaded on the website of the Company.
27. EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure -IV. The annual return of the Company would be placed on the website of the Company i.e. www.sibarauto.com.
28. STATE OF AFFAIRS OF THE COMPANY
The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.
29. MANAGEMENT DISCUSSION AND ANALYSIS:
Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations, 2015, a report on Management Discussion & Analysis is herewith annexed as
30. CORPORATE GOVERNANCE REPORT:
Pursuant to Regulation 34 read with Schedule V of SEBI (LODR) Regulations, 2015, a report on Corporate Governance is herewith annexed as
31. PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 (12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company is herewith annexed as Annexure- VII.
In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 120 Lakhs or more, or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month. The Company does not have any employee who is employed throughout financial year or part thereof, who was in receipt of remuneration in financial year under review which in aggregate, or as the case may be, at a rate which in the aggregate is in excess of that drawn by the Managing Director or Whole time director and holds by himself or along with his spouse and dependent children not less than 2% of the equity shares of the Company.
32. HUMAN RESOURCES:
Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Company s vision. Your Company appreciates the spirit of its dedicated employees.
33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant material orders passed by the Regulators /Courts/ Tribunals which would impact the going concern status of the Company and its future operations.
34. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no Material Changes and Commitments Affecting the Financial Position of the Company.
35. ACKNOWLEDGMENT AND APPRECIATION:
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business associates for their consistent support and continued encouragement to the Company. Further your Directors convey their appreciation for the whole hearted and committed efforts by all its employees. Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments, Stock Exchanges, SEBI, RBI and other Regulatory Bodies.
|By order of the Board of Directors|
|For Sibar Auto Parts Ltd|
|Pemmasani Veeranarayana||Pemmasani Madhu Pratap|
|Managing Director||Whole-Time Director|
|DIN: 00644259||DIN: 00644254|