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Your Directors have pleasure in presenting the 37th Annual Report of the Company, together with the Audited Financial Statements for the financial year ended 31st March, 2018.
The Companys performance during the financial year ended 31st March, 2018 as compared to the previous financial year is summarized below:
|( Rs in million)|
|Profit before Interest, Depreciation, and Taxation||3047.40||2753.63|
|Interest & Finance Cost||784.45||670.78|
|Profit Before Taxation||1803.89||1767.20|
|Profit After Taxation||1177.62||1242.15|
|Other Comprehensive Income||(3.01)||(0.67)|
|Total Comprehensive Income||1174.61||1241.48|
FINANCIAL PERFORMANCE HIGHLIGHTS
The Company continues to be on the growth track and for the first time the total revenue of the Company has crossed Rs 20,000 million mark. The total revenue increased to Rs 21,076.18 million from Rs 17,971.69 million during the year registering a growth of 17.27%. Profit Before Tax stood at Rs 1803.89 million as against Rs 1767.20 million in the previous year and Profit After Tax stood at Rs 1177.62 million as against Rs 1242.15 million in the previous year.
The financial results are elaborated and explained with the help of various ratios in the front end of the Annual Report.
STATE OF COMPANYS AFFAIR AND CURRENT YEARS OUTLOOK
The state of Companys affair and future outlook is discussed in the Management Discussion & Analysis Report which forms part of this Annual Report.
DIVIDEND & RESERVES
Your Company has adopted a Dividend Distribution Policy, which intends to ensure that a concise decision is taken with regard to the amount to be distributed to the shareholders as dividend. The policy lays down various parameters to be considered by the Board before declaration/ recommendation of dividend to the members of the Company. The Dividend Distribution Policy is available on the website of the Company at http://repository. skipperlimited.com/investor-relations/pdf/dividend.pdf and forms part of this Boards report as "Annexure A".
In accordance with Dividend Distribution Policy, the Board of Directors has recommended dividend of 165% i.e Rs 1.65/- per equity share of face value of Re. 1 each for the financial year ended 31st March, 2018.
The dividend, subject to approval of the shareholders at the ensuing Annual General Meeting will be paid within the statutory period to the members whose name appear in the Register of Members as on the close of business hours on 2nd August, 2018.
No amount is proposed to be transferred to General Reserve.
During the year under review, the Company issued and allotted 2,66,500 equity shares of Rs 1 each at a price of Rs 100.00pershare(includingpremiumof Rs 99.00 pershare)upontheexerciseof2,66,500 optionsundertheEmployee Stock Option Scheme of the Company. Consequently, the paid-up share capital of the Company increased to Rs 10,25,82,962.00/- consisting of 10,25,82,962 equity shares of Re.1 each.
INDIAN ACCOUNTING STANDARDS (IND AS)
Pursuant to the notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards ("Ind AS") notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from 1st April, 2017. Financial statements for the year ended and as at 31st March, 2017 have been restated to conform to Ind AS. The reconciliations and descriptions of the effect of the transition from IGAAP to Ind AS have been provided in the notes to accounts.
DIRECTORS & KEY MANAGERIAL PERSONNEL
The Board currently consists of five Executive Directors and five Independent Directors. None of the Directors of the Company are disqualified as specified in Section 164(2) of the Companies Act, 2013 read with Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.
Sri Yash Pall Jain (DIN: 00016663) was appointed as an Additional Director (Whole-Time) for a period of 3 (three) years and Sri Ashok Bhandari (DIN: 00012210) as an Additional Director (Independent) for a term of 5 (five) years with effect from 6th September, 2017. Both the appointments are subject to approval of the shareholders at the ensuing Annual General Meeting of the Company.
Pursuant to the provisions of Section 152(6) (c) of the Companies Act, 2013, Sri Siddharth Bansal (DIN: 02947929) retires by rotation, and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting of the Company.
Information regarding the directors seeking appointment/reappointment as required by Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as Listing Regulations) and Secretarial Standard-2 has been given in the notice convening the ensuing Annual General Meeting.
On recommendation of the Independent Directors the Board at its meeting held on 17th May, 2018, appointed Sri Amit Kiran Deb as the lead Independent Director. The role of the lead Independent Director is to liase on behalf of the Independent Directors and provide leadership to them.
Sri Sanjay Kumar Agrawal and Sri Manish Agarwal continue to act as the Chief Financial Officer and Company Secretary respectively.
DECLARATION BY INDEPENDENT DIRECTORS
Sri Amit Kiran Deb (DIN: 02107792), Sri Manindra Nath Banerjee (DIN: 00312918), Sri Joginder Pal Dua (DIN: 02374358), Sri Ashok Bhandari (DIN: 00012210) and Smt Mamta Binani (DIN: 00462925) are Independent Directors on the Board of the Company.
The Company has received declaration from each of the Independent Directors under Section 149(7) of the Companies Act, 2013 that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16 of Listing Regulations.
COMPANYS POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT PERSONNEL
The Board on the recommendation of the Nomination & Remuneration Committee has framed a policy for selection/ appointment/remuneration of Directors, Key Managerial Personnel and Senior Management. The policy aims to attract, retain and motivate qualified people at the executive and at the board levels and lays down criteria for determining qualification, positive attributes and independence of Director. The policy ensures that the interests of Board members & senior executives are aligned with the business strategy, objectives, values and long-term interests of the Company and is consistent with the "pay-for-performance" principle. The policy contains detailed procedure for selection and appointment of the Board Members and other executive members, explains the role of Independent Directors and also lays down the compensation structure of Non-Executive Directors, Executive Directors, Key Managerial Personnel(s) and Senior Management Personnel(s) .
The Policy is available on the website of the Company at http://repository.skipperlimited.com/investor-relations/ pdf/REMUNERATION-POLICY.pdf
The Board evaluation policy of the Company lays down the manner of evaluation of the Board as a whole, its committees and the individual Directors. The Company has a two tier evaluation system wherein the Independent Directors evaluate the performance of the Executive Directors, the Chairman and the Board as a whole and thereafter the Board evaluates the performance of all the individual Directors, the Committees and the Board as a whole. The policy lays down the criteria on which the evaluation is to be done and a structured questionnaire (evaluation form) with a rating matrix forms part of the Policy. The Chairman as per the evaluation policy of the Company, after discussion, deliberation and in consultation with all the Directors (except the Director being evaluated) fills up the evaluation form for the individual Directors, the Committees and the Board as a whole.
During the year under review, the Board carried out annual evaluation in accordance with the above said policy and expressed satisfaction on the evaluation process and the performance of all the Directors, the Committees and the Board as a whole.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act, 2013, your Directors state that:
(i) in the preparation of the Annual Accounts for the year ended 31st March, 2018, the applicable accounting standards have been followed and there are no material departures from the same;
(ii) they 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 state of affairs of the Company as at 31st March, 2018 and of the profit of the Company for the year ended on that day;
(iii) they 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 Annual Accounts for the year ended 31st March, 2018 have been prepared on a "going concern" basis;
(v) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
(vi) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
MEETINGS OF THE BOARD
The Board meets at least once in every quarter to review the Companys operations and financials and the maximum time gap between any two meetings is not more than 120 days. The Board met four times during the financial year ended 31st March, 2018, details of which are given in the corporate governance report forming part of the Annual Report.
COMMITTEES OF THE BOARD
The Board of Directors have constituted Audit Committee, Nomination and Remuneration Committee, Stakeholders RelationshipCommittee, Corporate Social Responsibility Committee,FinanceCommittee and Business Coordination Committee (earlier known as Executive Committee) to deal with specific areas/activities that need a closer review and to have an appropriate structure for discharging of its responsibilities.
The details of all the above committees along with composition, terms of reference, attendance at meetings are provided in the report on corporate governance forming part of the Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee.
CORPORATE SOCIAL RESPONSIBILITY
The Companys conscious endeavor is to serve the socio- economically backward, the under- privileged and the marginalized communities. The Company proactively engages with relevant stakeholders; understand their concerns and respond to their needs.
The Company has constituted a Corporate Social Responsibility (CSR) Committee, in terms of provisions of Section 135 of the Companies, Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 inter alia to give directions to the CSR initiatives of the Company, formulate and review annual CSR plans, formulate CSR budgets and monitor the progress of the CSR activities. The details of the committee have been disclosed in the corporate governance report.
The Company has further adopted a Corporate Social Responsibility Policy in accordance with the provisions of the Companies Act, 2013 which may be accessed at http://repository.skipperlimited.com/investor-relations/pdf/ CSR-Policy.pdf. The policy indicates the CSR activities to be undertaken by the Company to achieve its social commitments.
During the year, the Company was required to spend two percent of the average net profits for the preceding three financial years calculated in accordance with provision of Section 198 of the Companies Act, 2013. The Company has duly spent the said amount, the details of which are provided in Annual Report on CSR activities attached as "Annexure B" to this report.
The Company has a defined risk management framework to identify, assess, monitor and mitigate risks involved in its business. The Company understands that risk evaluation and risk mitigation is an ongoing process within the organization and is fully committed to identify and mitigate the risks in the business.
The Company has formulated and implemented a risk management policy in accordance with Listing Regulations, to identify and monitor business risk and assist in measures to control and mitigate such risks.
In accordance with the policy, the risk associated with the Companys business is always reviewed by the management team and placed before the Audit Committee. The Audit Committee reviews these risks on periodical basis and ensures that mitigation plans are in place. The Board is briefed about the identified risks and mitigation plans undertaken.
The risks faced by the Company are detailed in Management Discussion and Analysis Report forming part of this Annual Report.
In the opinion of the Board, as on date there are no material risks which may threaten the existence of the Company.
INTERNAL FINANCIAL CONTROLS
The Company has adequate internal control procedures commensurate with its size and nature of business. The objective of these procedures is to ensure efficient use and protection of the Companys resources, accuracy in financial reporting and due compliance of statutes and corporate policies and procedures.
The Internal Financial Control (IFC) system ensures that all assets are safeguarded and protected and that the transactions are authorized, recorded and reported correctly.
Internal Audit is conducted periodically and the internal auditor monitors and evaluates the efficiency and adequacy of internal control system including internal financial control in the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. All these steps facilitate timely detection of any irregularities and early remedial measures.
Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee for their inputs and suggestions. The Audit Committee regularly reviews the budgetary control system of the Company as well as system for cost control, financial controls, accounting controls, physical verification controls, etc. to assess the adequacy and effectiveness of the internal control systems. Such controls have been tested during the year and no reportable material weakness in the design or operation was observed.
Necessary certification by the Statutory Auditors in relation to Internal Financial Control u/s 143(3) (i) of the Companies Act, 2013 forms part of the Audit Report.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Company has in place a Vigil Mechanism/ Whistle Blower Policy to deal with unethical behavior and to provide a framework to promote responsible and secured reporting of undesired activities. The Vigil Mechanism/ Whistle
Blower Policy is available on the website of the Company at http://repository.skipperlimited.com/investor-relations/ pdf/Whistle-Blower-Policy.pdf.
The employees are free to report unethical behavior, actual or suspected fraud, violation of applicable laws and regulations, violation of code of conduct etc. The Audit Committee oversees the genuine concerns reported under this policy. The Company has also made provisions for adequate safeguard against victimization of employees who express their concerns. The mechanism also provides direct access to the Chairman of the Audit Committee.
During the year, no case was reported under this policy and no personnel has been denied access to the Audit Committee.
RELATED PARTY TRANSACTIONS
In line with the requirements of the Companies Act, 2013 and Listing Regulations, the Company has formulated a Policy on Related Party Transactions which is available on the website of the Company at http://repository. skipperlimited.com/investor-relations/pdf/RELATED-PARTY-TRANSACTIONS-POLICY.pdf.
All related party transactions are placed before the Audit Committee for prior approval and omnibus approvals are obtained for transactions which are repetitive in nature. A statement of all related party transactions is placed before the Audit Committee and Board of Directors for its review on a quarterly basis, specifying the nature, value and terms of the transaction.
All transactions entered into with related parties during the year were on arms length basis and in the ordinary course of business and there were no materially significant related party transactions that may have conflict with the interest of the Company nor there were any transactions which would require to be reported in Form AOC-2.
The details of all the related party transactions are provided in the Notes of the financial statements.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any loans, guarantees or made any investments as prescribed in Section 186 of the Companies Act, 2013. The Company has formed a Limited Liability Partnership in 2017-18, Capital Contribution in which has not been made till 31st March, 2018.
PARTICULARS OF EMPLOYEES
Disclosure pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time is attached as "Annexure- C" to this report.
The information required 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 as amended from time to time forms part of this Board Report. However, in terms of Section 136 of the Companies Act, 2013, the annual report is being sent to the members excluding the said statement. The said information is readily available for inspection by the members at the Companys registered office during the business hours on all working days up to the date of ensuing Annual General Meeting and shall also be provided to any member of the Company, who sends a written request to the Company Secretary.
EMPLOYEE STOCK OPTION PLAN
The Company had formulated Skipper Employee Stock Option Plan 2015 in accordance with SEBI (Share Based Employee Benefits) Regulations, 2014 to encourage and reward the performing employees of the Company. The Scheme is monitored by the Nomination and Remuneration Committee (also functioning as Compensation Committee) of the Board.
During the year, there has been no change in the Skipper Employee Stock Option Plan 2015 (scheme) and the same is in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014.
During the financial year, the Company has allotted 2,66,500 equity shares of Re. 1/- each at a premium of Rs 99/- each upon exercise of shares under the scheme and has granted 4,85,000 fresh options to the eligible employees under the scheme. All the necessary compliances in relation to allotment and listing of shares on stock exchanges were duly complied.
The applicable disclosures as required under SEBI (Share Based Employee Benefits) Regulations, 2014 is available on the website of the Company i.e http://repository.skipperlimited.com/investor-relations/pdf/sebi-disclosure-2014.pdf
The Company has received a certificate from M/s Singhi & Co., Statutory Auditors confirming that Skipper Employee Stock Option Plan 2015 have been implemented in accordance with SEBI (Share Based Employee Benefits) Regulations, 2014. The said certificate is available for inspection by the members at the Companys registered office during the business hours on all working days up to the date of ensuing Annual General Meeting and would also be placed at the ensuing Annual General Meeting for inspection by the members.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHNAGE EARNINGS AND OUTGO
The particulars as prescribed under Section 134(3) of the Companies Act, 2013 read with Rule 8(3) of Companies (Accounts) Rules, 2014 are attached as "Annexure D" to this report.
In accordance with Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rule, 2014, M/s. Singhi & Co., Chartered Accountants (Firm Registration No.: 302049E) were appointed as the Statutory Auditors of the Company at the Annual General Meeting of the Company held on 23rd September, 2014 for a term of five consecutive years.
In accordance with the provisions of Companies Amendment Act, 2017 enforced on 7th May, 2018, the concept of ratification of appointment of auditor at each Annual General Meeting has been done away with.
The report given by the auditors on the financial statements of the Company is part of the Annual Report. There is no qualification, reservation or adverse remark made by the statutory auditors in their report nor they have reported any instances of fraud under Section 143(12) of the Companies, Act, 2013.
In accordance with Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Board of Directors has appointed M/s. AB & Co., Cost Accountants as the Cost Auditors of the Company for the FY 2018-19 at a remuneration of Rs 70,000/- plus reimbursement of out of pocket expenses at actuals and applicable taxes. The remuneration needs to be approved by the shareholders at the forthcoming Annual General Meeting and a resolution regarding approval of remuneration payable to the cost auditor forms part of the notice convening the Annual General Meeting of the Company.
As a matter of record, relevant cost audit report for the year 2016-17 was free from any qualification and was submitted to the Central Government within stipulated time.
In accordance with Section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. MKB & Associates, Company Secretaries (FRN No. P2010WB042700) was appointed as the secretarial auditor of the Company for the FY 2017-18. The Secretarial Audit Report in the prescribed Form MR-3 for the financial year ended 31st March, 2018 is annexed herewith as "Annexure- E". The said report does not contain any qualification, reservation or adverse remarks.
Based on the consent received and on recommendation of the Audit Committee, the Board has appointed M/s. MKB & Associates as the secretarial auditor for the FY 2018-19.
In accordance with Section 138 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Board of Directors has appointed M/s. R. Kothari & Co., Chartered Accountants as Internal Auditors of the Company for the FY 2018-19.
EXTRACT OF ANNUAL RETURN
In accordance with the provisions of Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return as on 31st March, 2018 in the prescribed form MGT-9 is attached as "Annexure F".
The Company has not accepted any deposits from public under Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014, during the financial year 2017-18. As such, there is no outstanding unclaimed deposit as on 31st March, 2018. Few Directors have advanced loan to the Company during the year, details of which are available in notes to the financial statements.
In accordance with Regulation 34(3) read with Schedule V of Listing Regulations, a separate section on Corporate Governance and a certificate from the Statutory Auditors confirming compliance with the requirements of Corporate Governance forms part of the Annual Report.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
In accordance with Regulation 34(2) (e) read with Schedule V of the Listing Regulations, a separate section titled Management Discussion and Analysis forms part of the Annual Report.
BUSINESS RESPONSIBILITY REPORT
In accordance with Regulation 34(2) of Listing Regulations, the Company has voluntarily adopted business responsibility practices and a Business Responsibility Report (BRR) for the year 2017-18 is attached as "Annexure- G" to this report and is also available on the website of the Company at http://repository.skipperlimited.com/investor-relations/pdf/brr.pdf
The Report describes the initiatives taken by the Company from an environmental, social and governance perspective.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
The Company understands that employees are vital and valuable assets. The Company is proactive in providing growth, learning platforms, safe workplace and personal development opportunities to its workforce. The core focus of the Company has been on improvement of employees through training & development and also to identify out performers. Encouraging cordial working relation and maintaining good industrial relations have been the philosophy and endeavor of the human resource department of the Company. The Company has adopted an Employee Stock Option Plan to attract and retain key talents working with the Company.
The employee relations remained cordial throughout the year. The Company had 2416 permanent employees on its rolls as on 31st March, 2018.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company is committed to create a safe and healthy working environment that enables the employees to work without fear of sexual harassment at workplace.
Accordingly in accordance with the provision of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company has formulated and adopted a Policy for Prevention, Prohibition and Redressal of Sexual Harassment at Workplace.
During the year under review, no complaints were received under the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Your Directors state that:
1. During the year under review, there has been no change in the nature of business of the Company.
2. No material changes and commitments affecting the financial position of the Company have occurred from the close of the financial year ended 31st March, 2018 till the date of this Report.
3. During the year, no significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operation in future.
4. The Company does not have any subsidiary or associate or joint venture Company during the year ended 31st March, 2018, however the Company has formed a Limited Liability Partnership with a foreign Company with fifty percent partnership interest on 9th March, 2018, Capital Contribution in which has not been made till 31st March, 2018.
Your Directors place on record their gratitude to the Central Government, State Government, Banks, Financial Institutions, Government Authorities, Customers, Suppliers, Business Associates, Stock Exchanges and Shareholders for their continued support.
Your Directors also place on record their sincere appreciation to employees at all levels for their hard work, dedication and continuous contribution to the Company.
|For and on behalf of the Board of Directors|
|Sajan Kumar Bansal||Devesh Bansal|
|Place: Kolkata||Managing Director||Director|
|Date: 17th May, 2018||(DIN: 00063555)||(DIN: 00162513)|