UTL Industries Ltd Directors Report.

TO,

THE MEMBERS,

M/S UTL INDUSTRIES LIMITED

Your Directors have pleasure in presenting their Twenty Ninth Annual Report together with the Audited Accounts for the year ended 31st March, 2018.

SUMMARY OF FINANCIAL PERFORMANCE

(Rs. in lacs)
Particulars Current year (31-03-2018) Previous year (31-03-2017)
Profit/(Loss) before tax 148.53 78.22
Less: Provision for Taxation 0.00 0.00
Current Tax 39.50 15.47
Deferred Tax 0.01 0.00
Relating to earlier years 2.13 0.00
Profit/(Loss) after tax 106.89 62.75
Add: Balance brought forward from last year (85.81) (161.14)
Add : Transfer in Other Reserve - 12.58
Surplus available for appropriation 21.08 (85.81)
Less: Appropriations 0.00 0.00
Dividend on Equity Shares 0.00 0.00
Proposed 0.00 0.00
Interim 0.00 0.00
Dividend Distribution Tax 0.00 0.00
Transfer to General Reserve 0.00 0.00
Profit / (Loss) carried to Balance Sheet 21.08 (85.81)

Your Company has adopted Indian Accounting Standards (Ind AS). Accordingly, the financial statements for the year ended 31st March, 2018 have been prepared in accordance with Ind AS in terms of the provisions of Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time. Previous year figures have been restated as per Ind AS to make them comparable.

OPERATIONS & STRATEGIC PLANNING:

During the year under review, your company was engaged in construction activities. During the year under review, the Company has gained profit after activities of Rs. 106.89 lacs compared with previous year profit of Rs. 62.75 lacs. Further, total Reserves carried to Balance Sheet is Rs. 21.08 lacs compared to previous year negative reserve of Rs. 85.81.

The performance of your Company marked a notable improvement during the year under review. This sets an upswing trend on your Companys year-on-year performance. Overall, the improved performance can be attributed to the strategic initiatives taken by the Company, interalia, for meeting and anticipating customer needs timely, improving operational efficiencies with the end-goals of delivering products of highest quality at competitive costs.

FUTURE BUSINESS PROSPECTS:

Your directors are making all their efforts and confident of better performance for the following financial year 2018-2019. The Company is in the process of strategic expansion and diversification aiming at exponential growth for long term sustainability/viability in the competitive market environment. The business activities are largely influenced by several external factors including the international financial markets. During the year the international financial markets has remained sub dude and many times stagnant. It is therefore a note of caution to jump into the financial commitments.

DIVIDEND:

After considering the Company profitability, free cash flow and overall financial performance, the Board of Directors of the Company is pleased to recommend a Dividend of Rs. 0.05/- per equity share of face value of Rs. 1/- each for the financial year ended 31st March, 2018. The distribution of Dividend on equity shares, if approved by the Members at the ensuing Annual General Meeting, will result in payout of Rs. 16.48 lakhs excluding Tax on Dividend and surcharge/education cess thereon, as applicable.

SHARE CAPITAL:

During the year under review, there is no change in the Issued, Subscribed and Fully paid-up equity share capital of the Company. The paid up equity share capital as at 31st March, 2018 stood at Rs.3,29,55,000 /- (Rupees Three Crores Twenty Nine Lakh Fifty Five Thousand only).

TRANSFER TO RESERVE:

The Company has not transferred any amount to reserves.

SUBSIDIARY AND ASSOCIATES COMPANY:

As on 31st March 2018, your Company has no subsidiary, associates company and joint ventures company.

BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL:

In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Companys Articles of Association, Mr. Bhavik Vasantbhai Patel (DIN 07521766), Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment.

Mr. Shaileshchandra Nanubhai Naik (DIN 00892216), Director of the Company has resigned from the Board of Directors of the Company with effect from 31st August, 2018. The Board of Directors of the Company has appreciated for their co-operation and valuable time given to the Company.

Mr. Joy Kanaiyalal Chhikniwala (DIN: 08210813) has been appointed as an Additional Director of the Company with effect from 31st August, 2018 pursuant to Sections 149 and 161 of the Companies Act, 2013, read with the rules framed thereunder and Articles of Association of the Company and holds the office upto the date of the ensuing Annual General Meeting. Mr. Joy Kanaiyalal Chhikniwala is not disqualified from being appointed as a Director in terms of Section 164 of the Companies Act, 2013 and the Company has received a notice in writing under Section 160 of the Companies Act, 2013 from a member proposing the candidature of Mr. Joy Kanaiyalal Chhikniwala for the office of Director of the Company. The Nomination and Remuneration Committee has recommended the appointment of Mr. Joy Kanaiyalal Chhikniwala as an Independent non-executive Director, not liable to retire by rotation. The Board recommends the appointment of Mr. Joy Kanaiyalal Chhikniwala as

Independent Non-Executive Director, not being liable to retire by rotation for a period of five (5) years commencing from 31st August, 2018 to 30th August, 2023, for the consideration of the members of the Company at the ensuing Annual General Meeting.

The brief resume and other information/details of Directors seeking appointment/re-appointment, as required under Regulation 36(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Clause 1.2.5 of the Secretarial Standard on General Meetings (SS-2) are given in the Notice of the ensuing Annual General Meeting, which is being sent to the shareholders along with Annual Report.

In terms of the provision of section 196,197 read with scheduled V of companies Act, 2013 read with companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, Mr. Parimal R Shah (DIN 00569489) has been holding the office as whole time director designated as Managing Director effective from 1st October, 2014.

During the year there is no change in terms and conditions of his appointment and the payment of remuneration as permissible under the Companies Act, 2013.

DECLARATION BY INDEPENDENT DIRECTORS:

All Independent Directors had furnished to the Company a declaration under Section 149(7) of the Companies Act, 2013 stating that they meet criteria of Independence as provided under section 149 (6) of the Companies Act, 2013 and SEBI Listing Regulations.

SEPARATE MEETING OF THE INDEPENDENT DIRECTORS

The independent directors met on date 23rd day of March 2018 and evaluated the performance of non independent directors, the board as a whole and the chairman of the company considering the view of other directors.

NUMBER OF MEETINGS OF THE BOARD:

Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other businesses. The schedule of the Board/Committee meetings to be held in the forthcoming financial year is being circulated to the Directors in advance to enable them to plan their schedule for effective participation in the meetings.

The Board met Five (5) times during the FY 2017-18 viz. on 25/05/2017, 14/08/2017, 14/11/2017, 13/02/2018 and 23/03/2018.

CORPORATE SOCIAL RESPONSIBILITY:

Provisions of Section 135 of the Companies Act, 2013 are not applicable to the Company.

CORPORATE GOVERNANCE:

As per Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, the Corporate Governance is not applicable to the Company.

CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All related party transactions that were entered during the financial year were in the ordinary course of business of the Company and were on the arms length basis. There were no materially significant related party transactions entered by the Company with Promoters, Directors, Key Managerial Personnel or other persons which may have potential conflict with the interest of the Company. All Related Party Transactions are placed before the Audit Committee for approval.

The policy on materiality of Related Party Transactions and also on dealing with Related Party Transactions as approved by the Audit Committee and the Board of Directors is uploaded on the website of the Company and the link for the same is www.utlindustries.com.

Since all related party transactions entered into by the Company were in the ordinary course of business and were on an arms length basis, form AOC-2 is not applicable to the Company.

INTERNAL FINANCIAL CONROL SYSTEM AND THEIR ADEQUACY:

Your Company has implemented adequate procedures and effective internal controls for ensuring orderly and efficient conduct of the business, safeguard of its assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting record, timely preparation of financial statements and proper disclosure.

During the financial year, such controls were tested and no reportable material weakness in the design or operation was observed.

The internal and operational audit is conducted on regular basis The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.

VIGIL MECHANISM:

The Company has put in place a "Whistle Blower Policy" in compliance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and erstwhile clause 49 of the Listing Agreement entered with the Stock Exchanges, the Companies Act, 2013, other applicable laws and in accordance with the principles of good corporate governance.

LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES:

Pursuant to Section 186(11) of the Companies Act, 2013, guarantees given by Company in the ordinary course of its business are exempted from disclosure requirements under section 134(3) (g) of the Companies Act, 2013.

AUDITORS:

A) Statutory Auditors:

M/s Shirish Desai & Co., Chartered Accountants, having Firms Registration No: 112226W, appointed as the Statutory Auditors by the members at the 28th Annual General Meeting of the Company to hold office till the conclusion of the 29th Annual General Meeting. They have expressed their willingness to get reappointed as the statutory auditor of the company and has furnished a certificate of their eligibility and consent under section 141 of the Companies Act, 2013, In terms of the listing agreement, the auditors through their letter have confirmed that they hold a valid certificate issued by the peer review board of the ICAI, the necessary resolution for ratification of the appointment Statutory Auditors is placed before you for transaction. The resolution to appoint the statutory auditors upto subsequent General Meeting is placed for your necessary approval.

The auditors report for the year ended 31st March, 2018 are free from any qualifications, reservation or adverse remarks and hence do not call for any additional explanations or comments by the board.

B) Secretarial Auditors and Secretarial Audit Report:

Pursuant to the provisions of Section 204 of the Companies Act 2013, and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, your Company had appointed Mohd Daraz Khan, Proprietor MD Khan & Associates, Practicing Company Secretaries Vadodara to carry out secretarial audit for the financial year 2017-2018. The Company has provided all assistance and facilities to the Secretarial Auditor for conducting their Audit. The secretarial audit report for the financial year 2017-2018 is annexed to this report as Annexure 2.

There is Audit Qualifications in the Statutory Auditors Report and Secretarial Auditor Report as annexed elsewhere in this Annual report.

The Company has a business financial Controller, who is discharging a function of Chief Financial Officer. However, the Company has appointed the Chief Financial officer with effect from 10th May 2016. The Company has endeavored to appoint Company Secretary to guide to corporate affairs.

Ordinarily the Company has complied with the Listing requirements / Regulation from time to time. The Statutory filings under The Companies Act, 2013 were affected with additional fees and now the filings are updated.

The Company has not appointed Company Secretary as the Company is in process to appoint Company Secretary.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY:

There are no material changes and commitments affecting the financial position of the Company which has occurred between the end of the financial year of the Company i.e. 31st March 2018 and the date of the Director Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

During the year under review, there are no significant and material orders passed by the Regulators, Courts or Tribunals that would impact the going concern status of the Company and its future operations.

There are no material changes and commitments affecting the financial position of the Company which has occurred between the end of the financial year of the Company i.e. 31st March 2018 and the date of the Director Report.

a "Whistle Blower Policy" in compliance with the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and erstwhile clause 49 of the Listing Agreement entered with the Stock Exchanges, the Companies Act, 2013, other applicable laws and in accordance with the principles of good corporate governance.

REMUNERATION POLICY

The company has adopted a remuneration policy of directors and senior management personnel, detailing inter alia the procedure for director appointment and remuneration including the criteria for determining qualification.

The policy ensures that (a) the level and composition of remuneration is reasonable and sufficient to attract , retain, and motivate the directors of the quality require to run the company successfully;

(b) relationship of remuneration to the performance is clear and meets appropriate performance benchmarks ; and

(c) remuneration to directors and key managerial personnel and senior management involves a balance fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the company and its goal. The policy has been approved by the nomination and remuneration committee and the board. The remuneration policy document as approved by the board is uploaded on the companys website www.utlindustries.com

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Rule 5(1) (i) and (ii) the ratio and percentage increase of remuneration of the directors and employees: The Detailed particulars of employee is available on the website of the company.

a. Rule 5(1)(iii) and (v) comparison of the remuneration of the employees with company performance .

Remuneration of the employees % increase
Rs. 19,12,333=00 14.08%

 

Company performance % increase
Total Turnover : - 13,14,58,000/- 123.95%

b. Rule 5(1)(vi)& (ix) comparison of KMP remuneration with company performance

Particulars Rs.
Mr. Parimal R. Shah 2,76,000/-
Mr. Umesh R. Gandhi 1,92,000/-
Bhavik V Patel 4,18,000/-

 

Company Performance Rs. in Lacs.
Revenue-Sales and Other Incomes 1314.58
Profit before tax 148.53

c. the Number of permanent employees on rolls of the company are 10(Ten).

d. variations in the market capitalization of the company, price earning ratio of the company as at the closing date 31st March 2018 and previous financial year and percentage increase/decrease in the market quotations of the shares of the company as compared to the rate at which the company came out with last public offer;

Particulars Previous year Current year Increase/(decrease)
No of shares 3,29,55,000 of Rs. 1/- Each 3,29,55,000 of Rs. 1/- Each Nil
Share price in Rs. Exchange name
8.02 BSE
NSE
EPS (IN RS) 0.33 0.32
P/E RATIO (BASED ON AUDITED RESULT) ---
COMPANY MARKET CAP 17.53 (in Cr.) 26.43 (in Cr.)

REPORT ON ENERGY CONSERVATION, FOREGN EXCHANGE EARNING AND OUTGO RESEARCH AND DEVELOPMENT

Information relating to energy conservation, foreign exchange earned and spent and research and development activities undertaken by the company in accordance with the provision of section 134 of the companies act, 2013 read with companies (accounts) Rules, 2014 are given herein below.

CONSERVATION OF ENERGY

Your company is conscious to conserve the energy and for the purpose adequate measures are taken.

TECHNOLOGY ABSORPTIONS

Your company continues to use adequate technological application in the operation of the company.

FOREIGN EXCHANGE EARNING AND OUTGO:

There is no foreign exchange earnings and outgo during the financial year under review.

PUBLIC DEPOSITS:

Your Company has not accepted any public deposits within the meaning of Section(s) 73 to 76 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 during the year under review. As such no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet. The Company has not accepted any deposits during the year under review.

EXTRACT OF ANNUAL RETURN:

Pursuant to sub-section 3(a) of section 134 and sub section (3) of Section 92 of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return in form MGT-9 as at 31st March, 2018 forms part of this report as Annexure-A.

DIRECTORS RESPONSIBILITY STATEMENT:

In accordance with the provisions of SEC 134(3) ( c) read with Section 134(5) of the Companies Act, 2013 with respect to Directors Responsibility Statement it is hereby stated :

i) That in the preparation of the annual accounts for the financial year ended 31st March 2018, the applicable accounting standards have been followed and that there were no material departures;

ii) That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of the affairs of the company at the end of the financial year and of the profit of the company for the year under review.

iii) That the Directors had 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 a fraud and other irregularity,

iv) That the Directors have prepared the annual accounts for the year ended 31st March 2018 on a "going concern basis";

v) That 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,

vi) That the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that systems were adequate and operating effectively.

EVALUATION OF BOARDS PERFORMANCE:

The board has carried out an evaluation of its own performance and that of its directors individually and its committees. The manner in which the evaluation has been carried out is explained in the corporate governance report.

The company has also devised a policy on board diversity detailing the functional, strategic and structural diversity of the board.

ACKNOWLEDGEMENT:

Your Directors wish to thank all the stakeholders who have contributed to the success of your Company. Your Directors wish to place on record their appreciation, for the contribution made by the employees at all levels. Your Directors also wish to thank its customers, dealers, agents, suppliers, investors and bankers for their continued support and faith reposed in the Company.

By order of the Board of Directors,

PARIMAL R SHAH

Chairman & Managing Director

DIN NO: 00569489

Place: Vadodara

Date: 28th May, 2018