Srinivasa Hatcheries Pvt Ltd Directors Report

Dear Members,

Your Directors present their report together with audited financial statements for the financial year ended March 31, 2015.

FINANCIAL RESULTS	(Rupees in Lakhs)
PARTICULARS	2014-15	2013-14
Revenue from Operations	18581.60	14381.90
Other Income	329.28	359.83
Total Income	18910.88	14741.73
Operating Expenses	18662.40	13955.30
Profit before Tax and
Exceptional Items	248.48	786.43
Exceptional Items	150.15	0.00
Profit before Tax	98.33	786.43
Add/(Less): Provision for Tax
For the year	54.17	(237.76)
Deferred Tax - Release	7.90	(6.34)
Provision for tax for earlier years	4.16	(1.60)
Profit after Tax	47.90	540.73
APPROPRIATIONS:
a) Proposed Dividend	0.00	145.43
b) Corporate Dividend Tax	0.00	23.59
c) Transfer to General Reserve	0.00	54.10
d) Transfer to Contingency
Reserve	0.00	50.00
e) Profit Carried Forward	4401.40	4490.64

PERFORMANCE:

The members may note that the Companys performance during the year under review witnessed contrasting trend in regard to Turnover and the Profit Before Tax.The turnover in the financial year 2014-15 was Rs. 189 crores as against the previous years turnover of Rs. 147 crores, thus witnessing a growth by 28%. In contrast, the Profit Before Tax during the financial year 2014-15 stood at Rs. 2.48 crores as against the Profit Before Tax of Rs. 7.86 crores in the previous year. The fall in profit is on account of fluctuations and low realization in broilers. Further considering the extra-ordinary loss caused by Hudhud cyclone in Visakhapatnam, the Profit Before Tax during the year under review stood at Rs. 98 lakhs only.

DIVIDEND:

No dividend has been recommended for the financial year ended March 31, 2015.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND:

In terms of Section 205A and 205C of the Companies Act, 1956, unclaimed or unpaid Dividend relating to the financial year 2007-08 is due for remittance on 5th September, 2015 to the Investor Education and Protection Fund established by the Central Government.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statements relate and the date of this report, except that the Company is no more a Listed Company consequent on its Voluntary Delisting from BSE Limited, where its Companys shares were listed.

CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

A separate report on Corporate Governance along with the certificate issued by the Companys Statutory Auditors M/s. S.Daga & Co., Chartered Accountants thereupon is given as Annexure-1 to the Directors Report, Further a separate Management Discussion and Analysis Report is also enclosed as Annexure-2 to the Directors Report. These details are given as a measure of good governance even though the Companys shares are delisted from BSE Limited.

TRANSFER TO RESERVES:

The Company has not transferredany amount to the General Reserve out of the amount available for appropriations for the year ending 31st March, 2015. Further an amount of Rs. 4401.40lakhs is proposed to be retained in the Statement of Profit & Loss for the year ending 31st March, 2015.

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

Sri.C.Jagapati Rao was appointed as Chairman of the Company for life with effect from 1st April, 2014 consequent on his resignation as Executive Chairman. Further Smt.E.Padmaja, Smt.P.Usha Lakshmi, Sri.C.Yugendhar Rao and Sri.Srikant Jilla have resigned as Directors during the Financial Year under review.

In accordance with the provisions of the Companies Act, 2013Sri.K.Ashok Reddy retires by rotation and being eligible offers himself for appointment. Smt.Vanitha Datla was appointed as an Additional Director of the Company on 27th March, 2015 and she is proposed to be appointed as Director under the provisions of Section 160 of the Companies Act, 2013 at the ensuing Annual General Meeting.

Pursuant to the provisions of Section 203 of the Companies Act, 2013,Sri.C.Suresh Rayudu, Vice-Chairman & Managing Director (Chief Executive Officer), Mr. U.Ganesh, General Manager (Finance) (Chief Financial Officer) and Mr. V.K.Murali Manohar, DGM (Corporate Affairs) & Company Secretary are the Key Managerial Personnel of the Company.

NUMBER OF MEETINGS OF THE BOARD:

During the year, seven meetings of the Board of the Directors of the Company were convened and held, the details of which form part of the Report on Corporate Governance.

BOARDS EVALUATION AND ASSESSMENT:

The Company believes that formal evaluation of the board and of the individual directors, on an annual basis, is an effective way to respond to the demand for greater board accountability and effectiveness. For the company, evaluations provide an ongoing means for directors to assess their individual and collective performance and effectiveness.

By focusing on the board as a team and on its overall performance, the Company ensures that communication and overall level of participation and engagement also improves.

DECLARATION FROM INDEPENDENT DIRECTORS:

The Company has received necessary declarations from each Independent Director of the Company under Section 149(7) of the Companies Act, 2013 that the Independent Directors of the Company meet with the criteria of their Independence laid down in Section 149(6).

DELISTING FROMBSE LIMITED:

During the year under review, the Board of Directors at its Meeting held on 4th December, 2014 considered and approved the proposal received from the Promoter Acquirers to make a voluntary delisting offer to the public shareholders of the Company in pursuance of the SEBI (Delisting of Equity Shares) Regulations, 2009 as amended.

Further shareholders have approved the voluntary delisting proposal through Postal Ballot by means of a Special Resolution dated 14th January, 2015. Thereafter in pursuance of the above said SEBI Regulations, an Exit Offer has been given by the Promoter Acquirers to acquire the shares from the public shareholders. After reaching the required threshold limit of ninety percent of shareholding by the Promoters consequent on the acquisition of shares from the public shareholders in the Exit Offer, the Companys equity shares have been voluntarily delisted from BSE Limited with effect from 16th June, 2015.

Further, the Company confirms that it has paid the Annual Listing Fees for the year 2015-2016 to BSE Ltd. where the Companys Shares were listed till 15th June, 2015.

AUDITORS:

M/s. S.Daga & Co., Chartered Accountants, Hyderabad, (Firm Registration No.000669S) the statutory auditors of the Company who hold office upto the conclusion of the forthcoming annual general meeting had given their consent, if appointed, to hold office as statutory auditors from the conclusion of this annual general meeting till the conclusion of next annual general meeting. Further they have confirmed their eligibility under Section 141 of the Companies Act, 2013 and rules framed there under.

The Board proposes the appointment of M/s. S.Daga & Co., Chartered Accountants, Hyderabad as statutory auditors of the Company. Necessary resolution is being placed in this regard before the members for their approval.

AUDITORS REPORT & SECRETARIAL AUDITORS REPORT:

The Auditors Report and Secretarial Auditors Report do not contain any qualifications, reservations and adverse remarks.

The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as Annexure-3 to this Report.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) and 134(5) of the Companies Act, 2013, the Board of Directors of the Company confirm to the best of their knowledge and belief that in the preparation of the statement of profit and loss for the financial year ended March 31, 2015 and the balance sheet as at that date ("financial statements"):

i) the applicable accounting standards have been followed;

ii) appropriate accounting policies have been selected and applied consistently and such judgements and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for that period;

iii) proper and sufficient care has been taken 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 financial statements have been prepared on a going concern basis.

v) the proper internal financial controls are in place and that such internal financial controls were adequate and were operating effectively

vi) the systems to ensure compliance with the provisions of the applicable laws are in place and were adequate and operating effectively.

INFORMATION AND DISCLOSURES UNDER THE COMPANIES ACT, 2013

SHARE CAPITAL:

The Paid-up Equity Share Capital as on 31st March, 2015 was Rs. 9,69,55,000/- consisting of 96,95,500 equity shares of Rs. 10/-each fully paid-up. During the year under review the Company has neither issued shares with a differential voting rights nor granted stock options nor sweat equity shares.

EXTRACT OF ANNUAL RETURN:

The extract of Annual Return pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act, 2013 (Act) in the prescribed form MGT-9 is annexed herewith as Annexure-4.

REMUNERATION TO DIRECTORS:

The remuneration structure of Managing Director/Executive Directors comprises of basic salary, commission, perquisites and allowances, contribution to provident fund etc. The remuneration is determined considering various factors such as qualification, experience, expertise, prevailing remuneration in the industry and the financial position of the Company.

The Non-Executive Independent Directors are entitled to sitting fee for attending the Board/Audit Committee meetings. Further the Non-Executive Independent Directors are entitled to a sum as decided by the Board as Commission, provided the aggregate of such commission shall not exceed 1% of net profits of the Company in each year.

RISK MANAGEMENT:

The Audit Committee and the Board discusses significant business risks and the mitigation steps/action plan to mitigate the same, while reviewing the performance of the Company periodically. In the opinion of the Board, there are no major elements of risk which has the potential of threatening the existence of the Company.

CORPORATE SOCIAL RESPONSIBILITY:

In tune with the provisions of the Companies Act, 2013 and the Rules made thereunder, a Corporate Social Responsibility (CSR) Committee has been formed. Your Company has identified sanitation, health care, education as thrust areas for CSR Activities. The Annual Report on CSR Activities is annexed herewith as Annexure-5 to this Report.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:

The particulars of loans, guarantees and investments have been disclosed in the Financial Statements.

TRANSACTION WITH RELATED PARTIES:

The related party transactions that were entered into during the financial year were on arms length basis and were in the ordinary course of business.During the financial year 2014-15, there were no materially significant transactions with the related parties which might be deemed to have had a potential material conflict with the interest of the Company at large.

The summary statement of transactions entered with the related parties is placed before the Audit Committee as also the Board for approval. As all the transactions with related parties are on Arms length basis and there are no material related party transactions as per policy adopted by the Company, the particulars of contracts or arrangements with related parties under Section 188 in Form AOC-2 is not enclosed.

INTERNAL CONTROLS:

The Company has in place adequate system of internal controls commensurate with its size and nature of its operations. The Companys internal control system covers financial propriety of business transactions and safeguarding the assets of the Company.

REGULATORY ORDERS:

There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

DEPOSITS FROM PUBLIC:

The Company has not accepted any deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposit) Rules, 2014 during the year under review. There are no outstanding deposits as on March 31, 2015.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

There are no employees drawing remuneration in excess of the limits prescribed under Rules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Further since the Company is no more a Listed Company, the details required under Section 197(12) of the Act are not enclosed.

PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE POLICY:

The Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (Act). An Internal Complaints Committee (ICC) has been formed to look into redressal of complaints on sexual harassment. All women employees are covered under this Policy. During the year 2014-15, there were no complaints received by the ICC.

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

A. CONSERVATION OF ENERGY

The operations of your company involve low energy consumption. Adequate measures have, however, been taken to conserve the energy wherever practicable.

B. TECHNOLOGY ABSORPTION	: NIL
(i) R & D ADOPTION/INNOVATION	: NIL
(ii) R & D EXPENDITURE	:
• Capital	:
• Recurring	:
	NIL
• Total	:
• Total R & D Expenditure as a
percentage of total income	:
C. (a) FOREIGN EXCHANGE EARNINGS	: NIL
(b) FOREIGN EXCHANGE OUTGO	: Rs. 321.76 lakhs

ACKNOWLEDGEMENTS:

Your Directors place on record their appreciation of the continued assistance and co-operation extended to your company by the Companys Bankers viz., HDFC Bank Limited, ICICI Bank Limited and Andhra Bank, Government & Semi Government Authorities, Venkateshwara Hatcheries Group, National Egg Coordination Committee (NECC), All India Poultry Development and Services Pvt. Ltd., Andhra Pradesh Poultry Federation (APPF) and Bharat Egg Producers Association (BEPA), shareholders, customers, dedicated employees, Share Transfer Agents of the Company and all others who continue to assist your Company.

for and on Behalf of the Board of Directors

Place: Hyderabad	C.JAGAPATI RAO
Date : 29-07-2015	CHAIRMAN