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Your Directors have pleasure in presenting the 39th (Thirty Ninth) Annual Report of the Company together with the Audited Accounts for the year ended March 31,2018.
|1 FINANCIAL RESULTS||2017-18||2016-17|
|(Rs. In lakhs)||(Rs. In lakhs)|
|Sales/ Income from operations||51790.73||69019.90|
|Profit before interest. Depreciation and Tax||3657.46||4861.65|
|Provision for Income Tax/ Deferred Tax||919.68||(155.62)|
|Profit / Loss after Tax||(1474.18)||215.31|
|Balance brought forward from previousyear||281.64||266.33|
|Dividend & Distribution Tax|||||
|Transferred to/from General Reserve||||200.00|
|Balance Carried forward||(1192.54)||281.64|
No Dividend recommended by the Board forthe year under review.
3. REVIEW OF OPERATIONS
The troubles continued in the economy, with almost 6 months of domestic market disturbance due to implementation of GST. Distributors and retailers started de-stocking before GST and the slowness continued for a few months post GST. Yarn, fabric and garments were all badly affected, leading to a drastic fall in sales.
The export market got weakened due to Rupee moving from 68 levels to 64 levels, making us uncompetitive. Overall Indian exports for the industry fell by 4%.ln 2017-18.
The Company decided to go in for re-structuring of its textile business portfolio. It decided to reduce its dependence on the low margin, high beta yarn business and shift more towards the value added and stable branded garments business.
The Company sold about 50% of its total spinning capacity and decided to install in Uttar Pradesh, Tamil Nadu and West Bengal garment manufacturing capacity taking advantage of the Central ATUF Incentive Policy and the respective State Government Textile Policies.
All the above factors have lead to a fall in turnover to Rs 500 Crores, despite an increase in garment turnover. The above factors, also lead to losses in the first two quarters though the Company managed to stay in the black in the last two quarters.
The business restructuring has also enabled the Company to reduce its long term debt from Rs 186 crores to Rs 151 crores during the year.
We are also happy to announce that the Company received the Award of "Most Desirable 30 Power Brands", which affirms the strength of its brand TT which will spearhead the growth in the coming times.
In nutshell its a year best forgotten for financials, but is a landmark in terms of a clear policy change, which has already starting showing small fruits.
4. FUTURE OUTLOOK
As we enter the New Year we start with optimism. The demonetization & GST impact is bygone and GST seems a reality that would improve our competitiveness against the large unorganized garment segment. We are already seeing positive impact of the same and growth in garments despite a 6 month GST impacted demand.
The INR has depreciated by about 4% from the highs giving us a competitive edge once again in exports.
The Company no more carries the baggage of old uncompetitive spinning machinery. The land and building will be used for value added, high margin garments.
The Company is seeing good response to its casual wear range. It has launched its new range under a new brand -" HiFlyers" which has helped breakfree from the perception of being an innerwear brand.
The Company Exclusive Brand Outlet (EBO) chains by the name of "T T BAZAAR" to build direct connect with the consumer is getting good response. 50 TT Bazaar franchisee stores are running and many more are in the pipeline. Company proposes to take it to 200 in the next 12 months.
New garment factory in Gajroula is expected to start sometime during quarter 2, while Kolkata will start in near future. The up gradation of Avinashi factory also should be completed sometime in quarter Q2.
We therefore start with lot of hope and optimism of achieving new heights and taking the brand and company to new levels. We are more focused on the value added segment and domestic sales which will de-risk the business and bring in more stability to turnover and margins. We are confident of growing our brand in the garment segment and gaining market share in the years to come.
We have gone through a bad phase, but luckily have emerged stronger and wiser which will hold us in good stead in the days to come.
5. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
As part of its initiatives under "corporate social responsibility" (CSR), the Company has contributed funds for the schemes of eradicating hunger and poverty, promotion of education and medical aid. The contributions in this regard have been made to the registered trust which is undertaking these schemes.
The Annual Report on CSR activities is annexed herewith as Annexure B.
6. RISK MANAGEMENT
The Company has a well defined risk management framework in place. Further, it has established procedures to periodically place before the Board, the risk assessment and management measures. As such, there are no risks which in the opinion of the Board threaten the existence of the Company.
The Board of Directors in their meeting held on 11th November, 2015 had constituted Risk Management Committee of the Company. The committee has formulated Risk Management Policy of the Company which has been later on amended on 13th December, 2017 and subsequentlyapproved bythe Board of Directors of the Company.
The Risk Management Policy may be accessed on the Companys website at the link: http://www.ttlimited.co.in Anvestor/companypolicies.
7. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The internal Audit functions reports to the Chairman of the Audit Committeeand to Chairman and Managing Director of the Company.
The Internal Audit monitors and evaluates the efficiency and adequacy of internal control systems in the company. Its compliances with operating systems, accounting procedure and policies at all locations of the Company.
8. INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.
9. RELATED PARTIES TRANSACTIONS
All related party transactions that were entered into during the financialyear were on arms length basis and were in the ordinary course of the business. There are no materially significant related party transactions made bythe Company with Promoters, Key Management Personnel or other designated persons which may have potential conflict with interest of the Company at large.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL
Smt. JyotiJain (holding DIN No. 01736336), retire by rotation at the ensuing Annual General Meeting and being eligible offer herself for reappointment.
All Independent Directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and Regulation of the Listing Agreement.
During the year there was no change (appointment or cessation) in the office of any KMP.
11. POLICY ON REMUNERATION OF DIRECTORS, KMPs SENIOR MANAGEMENT PERSONNEL AND OTHER EMPLOYEES INCLUDING CRITERIA S AS DETERMINED BY NOMINATION AND REMUNERATION COMMITTEE
The remuneration paid to Directors is in accordance with the Nomination and Remuneration Policy of the Company formulated in accordance with Section 134(3) (e) and Section 178(3) of Companies Act, 2013 read with Regulation 19 of SEBI Listing Regulations (including any statutory modification(s) or re-enactment(s) for the time being in force.
Nomination and Remuneration Committee has formulated the criteria for determining the qualifications, positive attributes and independence of directors in accordance with Section 178(3) of Companies Act 2013 and recommended the same to Board.
12. BOARD OF DIRECTORS MEETING
During the year four Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
13. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 (5) of the Companies Act, 2013, your Directors report as under:
a) That in the preparation of the annual accounts, the applicable accounting standards have been followed.
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 of the company at the end of the financial year and of the profit or loss of the company forthat period.
c) That the Directors have 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.
d) That the Directors have prepared the annual accounts on a going concern basis.
e) That the Directors had laid down internalfinancialcontrols to be followed by the Company and that such internalfinancialcontrols are adequate and operating effectively.
f) That 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.
g) No fraud has been reported by the auditors under Section 143(12) of Companies Act 2013 forthe F.Y. 2017-18.
14. BOARD EVALUATION
Pursuant to the provisions of the Companys Act. 2013 and Regulation 17(10) of the Listing Agreement, 2015, the Board has carried out an evaluation of its own performance and the performance of the directors individually for the financial year 2017-18 in the Board Meeting held on 18th May, 2018.
Your Directors feel pleasure in informing the members that the performance of the Board as a whole and its member individually was adjudged satisfactory. Company framed policy and criteria for evaluation of Executive Directors, Chairperson, and Independent Directors and have also devised criteria on Board of Directors as whole and individual Committee of the board.
15. PARTICULARS OF REMUNERATION OF DIRECTORS AND KMPs
A statement containing the details of the Remuneration of Directors and KMPs as required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel Rules, 2014) is mentioned in Corporate Governance Report.
16. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT
The Company has not given any loan or guarantees covered under the provisions of section 186 of the Companies Act, 2013.
17. CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the Company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behavior of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct" which forms an Appendix to the Code. The Code has been posted on the Companys website www.ttlimited.coin
18. AUDIT COMMITTEE DISCLOSURES
The Audit Committee consists of Shri Navratan Dugar, Independent Director, Shri V. R. Mehta, Independent Director, Dr. (Prof.) V. K. Kothari, Independent Director, Shri M.C Mehta, Independent Director and Shri Sanjay Kumar Jain, Managing Director. Shri Navratan Dugar is the Chairman of the Committee and Sh. M C Mehta, Independent Director has been appointed as member of the Audit Committee in its meeting dated 13th December, 2017
Mrs. Reetika Mahedra Rathore, is Secretary of the Committee. All the recommendation made by the Audit committee were accepted by the Board.
Vigil Mechanism/Whistle Blower Policy
The Vigil Mechanism of the Company, which also incorporates a Whistle Blower Policy in terms of the Listing Agreement aims to provide a channel to the employees and Directors to report to the management concerns about unethical behavior, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguard against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Chairman/Chairman of the Audit Committee in exceptional cases.
The policy of Vigil Mechanism and Whistle Blower Policy as approved by the Board may be accessed on the Companys website at the link:_http://www.ttlimited.co.inAnvestor/companypolU:ies
19. PREVENTION OF INSIDERTRADING
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The code of conduct shall stipulate such formats as the board of directors deems necessary for making applications for pre-clearance, reporting of trades executed, reporting of decisions not to trade after securing pre-clearance, recording of reasons for such decisions and for reporting level of holdings in securities at such intervals as may be determined as being necessary to monitor compliance with these regulations. The Board is responsible for implementation of the Code.
All Board of Directors and the designated employees have confirmed compliance with the code.
20. EXTRACT OF ANNUAL RETURN FORTHE FINANCIALYEAR ENDED ON 31ST MARCH, 2018
The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of Companies (Management and Administration) Rules, 2014 for the financial year 2017-18 in Form No. MGT-9 has been placed and may be accessed from Companys website www.ttllmited.co.inAnvestors/results/reports.
21. NUMBEROF MEETINGS OF THE BOARD
During the Financial Year 2017-18,4(Four) Board Meetings were held. For details thereof kindly refer to the section Board of Directors in the report of Corporate Governance forming part of this Annual Report.
22. AUDITORS AND AUDITORSREPORTS
a. Statutory Auditor:
At the Annual General Meeting held onl3th September, 2017, M/s RS Modi&Co., New Delhi were appointed as Statutory Auditors of the Company to hold the office till the conclusion of 43rd Annual General Meeting of the Company. In terms of the provisions of amended Section 139(1) of the Companies Act 2013, the appointment of statutory auditors shall not be for ratification at every
Annual General Meeting.
Further, Statutory Auditor of the Company has submitted Auditors Report on the Accounts of the Company for the accounting year ended on 31st March 2018. The Auditors report is self explanatory and requires no comments.
b. Secretarial Auditor
M/s DMK Associates, Company Secretaries has been appointed as Secretarial Auditors of the Company bythe Board of Directors in their meeting held on 18th May, 2018 for the financial year 2018-19.
The Secretarial Auditors of the Company have submitted their Report in form No. MR- 3 as required under Section 204 of the Companies Act, 2013 forthe financialyear ended 31st March, 2018. This Report is self explanatory and requires no comments. The Report forms part of this report as Annexu re-III.
c. Cost Auditor
The Board of Directors has appointed M/s K. L. Jaisingh & Co., Cost Accountants, New Delhi as the Cost Auditors of the Company to conduct Cost Audit of the Accounts for the financial year ended 2018-19 However, as per provisions of Section 148 of the Companies Act, 2013 read with Companies (Cost Record and Audit) rules, 2014, the remuneration to be paid to the Cost Auditors is subject to ratification by members at the ensuing Annual General Meeting. Accordingly, the remuneration to be paid to K. L. Jaisingh & Co., Cost Accountants, New Delhiforthe Financial Year 2018-19 is placed for ratification bythe members.
23. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Energy Conservation continues to be an area of major emphasis in our Company. Efforts made to optimize the energy cost while carrying out manufacturing operations.
The information required to be furnished under section 134 (3)(m) of the Companies Act, 2013 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 2014 relating to Conservation of Energy, Technology absorption and Foreign Exchange earnings and outgo is annexed herewith as Annexure"A" and forming part of this report.
24. PARTICULARS OF EMPLOYEES
Information as per Section 134 of the Companies Act, 2013 read with Companies (Particulars of Employees) Amendment Rules, 2011 are given in the statement which from a part of this report. However as per the provisions of section 136 of the Companies Act, 2013, the report and accounts are being sent to all shareholders of the Company excluding the aforesaid information. Any shareholder interested in obtaining a copy of the particulars may write to the Companys Registered Office.
25. INDUSTRIAL RELATIONS
During the year under review, your Company enjoyed cordial relationship with workers and employees at all level.
26. CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements setoutbySEBI.
A separate report on Corporate Governance along with Auditors Certificate on its compliance is annexed to this report.
27. MANAGEMENT DISCUSSION AND ANALYSIS
Management discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of the Listing Agreement, 2015 with the stock exchanges is presented as a separate section forming part of this report.
28. PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
The Company is committed to provide a protective environment at workplace for all its women employees. To ensure that every women employee is treated with dignity and respect the company has in place formal policy for prevention of sexual harassment at work place and the Company has also constituted the Internal Complaint Committee in Compliance with the requirement of this act.
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.
29. GENERAL DISCLOSURES
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review: -
a. Details relating to deposits covered under Chapter V of the Act.
b. Issue of equity shares and differential rights as to dividend, voting or otherwise.
c. Issue of Shares (including sweat equity shares) to employees of the Company under any scheme.
d. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.
e. Company does not have any subsidiary.
Your Directors place on record their sincere appreciation of the services rendered by the employees of the Company. They are grateful to shareholders, bankers, depositors, customers and vendors of the company for their continued valued support. The Directors look forward to a bright future with confidence.
|For and on behalf of the Board|
|Place: New Delhi||Sd/|
|Date: 18.05.2018||Dr. RIKHAB C. JAIN|
|DIN NO. 01736379|