Vaswani Industries Ltd Directors Report.

The Directors take pleasure in presenting the Sixteenth Annual Report on the business and operations of the company and its financial results for the year ended on 31st March, 2019.

1. FINANCIAL RESULTS

Financial Results of the Company for the financial year under report are summarized below for your consideration:

(Rs. in Lacs)
PARTICULARS 31-03-2019 31-03-2018
INCOME FROM OPERATIONS 31964.93 23779.08
PROFIT BEFORE INTEREST AND DEPRECIATION 1802.67 1664.87
FINANCE COST 952.08 872.56
DEPRECIATION 520.55 539.32
NET PROFIT BEFORE TAX 330.04 252.99
TAX EXPENSES 213.99 (197.78)
NET PROFIT AFTER TAX 116.05 450.77
TRANSFER TO GENERAL RESERVE 11.61 45.07
TRANSFER TO PROFIT & LOSS ACCOUNT 104.44 405.70

2. PERFORMANCE REVIEW

During the year under review, your Company has achieved profit of Rs. 116.05 lacs after meeting all expenses and taxes, as compared to Rs. 450.77 lacs during the previous year. As compared to the previous year, the profit of the Company has been reduced by 25.74% due to the market conditions. The Earning per share have also been reduced from 1.50 to 0.39. The directors of the Company gives an assurance that the performance of the Company will get better in the near future and they bring more profit in the upcoming years.

3. FUTURE PROSPECTS

Barring any unforeseen circumstances, the company hopes not only to maintain its current level of operations and to further improve thereon.

4. INDIAN ACCOUNTING STANDARD

The Ministry of Corporate Affairs (MCA) on February 16, 2015, notified that Indian Accounting Standards (Ind AS) are applicable to prescribed Listed Companies from April 1, 2017. Ind AS has replaced the previous Indian GAAP prescribed under Section 133 of the Companies Act, 2013 (the Act) read with Rule 7 of the Companies (Accounts) Rules, 2014. Ind AS is applicable to the Company from April 1, 2017. The reconciliations and descriptions of the effect of the transition from previous GAAP to Ind AS have been set out in Note A & B in the notes to accounts in the standalone financial statement.

5. SHARE CAPITAL

a) Capital structure: The Authorized Share Capital of your Company is Rs. 35,00,00,000/- comprising of 3,47,50,000 Equity Shares of Rs.10/- each and 2,50,000 Non Cumulative Preference Shares of Rs.10/- each. The Paid-up Share Capital is Rs. 30,00,00,000/- comprising of 3,00,00,000 Equity Shares of Rs.10/- each.

b) Buy Back of Securities - The Company did not buy back any of its securities during the year under review.

c) Sweat Equity - The Company did not issue any Sweat Equity Shares during the year under review.

d) Bonus Shares - No Bonus Shares were issued during the year under review.

e) Employees Stock Option - The Company has not provided any Stock Option Scheme to the employees.

6. SAFETY

The company continues to adopt safety measures to protect the health of workers. Company has complied with the measures to be taken regarding hazards or risks to safety and health from the production of iron and steel, including appropriate standards, codes and guidelines as prescribed, approved or recognized by the competent authority. Company continues to properly maintain its workplaces, plant, equipment, tools and machinery, and also organizes work in such a manner so as to eliminate and control hazards and risks in the production of iron and steel, which is in consistent with national laws and regulations. Company in consultation with workers and their representatives, looks after:

(i) assessment of the hazards and risks to the safety and health of workers arising from the production of iron and steel,

(ii) effective use of the information provided by the supplier of equipment or materials and from other reasonably available sources; and

(iii) measures to reduce exposure to eliminate or control risks to safety and health identified in the above risk assessment.

7. POLLUTION CONTROL MEASURES

The company is law compliant and has already installed Waste Heat Recovery Boilers (WHRB) equipped with 3 kilns 100 X 3 MT per day capacity, which help to generate 11.5 Mw power/hour preventing the waste, heat and fumes to dilute in the atmosphere. Emission Stream Pre-treatment (ESP) machines are implemented to filter the gases from the all the chimneys of the industry. Plantation is a vivacious step taken by the company to cover most of the area near the industry.

8. DIVIDEND

With a view to conserve the liquid resources and to strengthen the financial position of the Company, your board of directors has not recommend dividend for the financial year ended 31st March, 2019.

9. DEPOSITS

The Company has not accepted any deposit from the public falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

10. TRANSFER TO RESERVES

Your Company has transferred 10% of profit i.e. Rs.11.61 lacs in the General Reserves Account during the Financial Year 2018-19.

11. CHANGES IN NATURE OF BUSINESS:

The Company has been engaged in the business of manufacturing the trading of Iron Ore Pellets, Sponge Iron, Steel Billets, HB Wires and generation of Power. There is no change in the nature of Business of the Company during the Financial Year 2018-19.

12. LISTING

The equity shares of the Company are listed on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). The company is duly complying with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 from time to time.

13. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Board of Directors have established Whistle Blower Policy and Code of Conduct for the directors & employees of the Company as required under the provisions of Section 177 of the Companies Act, 2013 read with Rule 7 of the Companies (Meeting of Board and its powers) Rules, 2014. The said Policy has been properly communicated to all the directors and employees of the Company through the respective departmental heads and the new employees shall be informed about the Vigil Policy by the Personnel Department at the time of their joining. Managing Directors declaration regarding compliance of Code of Conduct by Board Members and Senior Management personnel is annexed as Annexure-A

14. CONSERVATION OF ENERGY & TECHNICAL ABSORPTION & FOREIGN EXCHANGE EARNING OUTGO

In accordance with the requirements of section 134 (3) (m) of the Companies Act, 2013 read with the companies (Disclosure of Particulars in Report of Board of Directors) Rules 1988, a statement showing the information relating to the Conservation of Energy, Research and Development, Technology absorption and foreign exchange earnings and is enclosed in Annexure-B and should be treated as a part of this report.

15. PROVISION FOR TAX

Liability of tax have been determined on the basis of Accounting Standard-22 which is accounting for taxes on income and accordingly, the tax expenses comprising of deferred tax liability have been calculated.

16. INDUSTRIAL RELATIONS:

Industrial relations in the company during the year were peaceful, cordial and healthy. Company had been able to maintain good industrial atmosphere and enjoys mutual trust between the management and its employees.

17. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement Under Section 134 (5) of the Companies Act 2013, with respect to Directors, Responsibility Statement, it is hereby confirmed that:-

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) the directors had 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 and loss of the company for that period;

(c) the directors had 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) the directors had prepared the annual accounts on a going concern basis; and

(e) the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) 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.

18. AUDITORS

Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the rules framed thereafter, M/s. Amitabh Agrawal & Co., Chartered Accountants, (Firm Regn. No. 006620C) were appointed as Statutory Auditors of the Company for a term of five consecutive Financial Years from the conclusion of 15th Annual General Meeting held on 30.10.2018 till the conclusion of the 20th Annual General Meeting of the Company to be held in the year 2023.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Record and Audit) Amendment Rules 2014 M/s Sanat Joshi & Associates has been re-appointed as cost auditors for conducting Cost Audit for the financial year 2018-19.

Internal Auditors

M/s Agrawal Jain & Co, Chartered Accountants were appointed as Internal Auditors for the FY 2018-19.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Satish Batra & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit for the financial year 2018-19.

19. AUDITORS REPORTS

Statutory Auditors

There are no qualifications, reservations, adverse remarks or disclaimers in the statutory Auditors Report on the Financial Statements of the company for the financial year 2018-19 and hence does not require any explanations or comments.

Secretarial Audit

There are no qualifications, reservations, adverse remarks or disclaimers in the Secretarial Auditors Report on Secretarial and other applicable legal compliances to be made by the company for the financial year 2018-19 and hence does not require any explanations or comments. The Report of the Secretarial Audit Report is annexed herewith as Annexure-C.

20. EXTRACT OF THE ANNUAL RETURN AS REQUIRED UNDER SECTION 92(3) OF THE COMPANIES ACT, 2013

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as Annexure-D.

21. DECLARATION - INDEPENDENT DIRECTORS

The Board of Directors declare that the Independent Directors Mr. Lekhu T Mulchandani, Mr. Ashok Suri, Mr. Sanjay Jadwani & Mrs. Satyawati Parashar are:

(a) in the opinion of the Board, are persons of integrity and possesses relevant expertise and experience;

(i) who were or were not a promoter of the company or its holding, subsidiary or associate Company.

(ii) who are not related to promoters or directors in the company, its holding, subsidiary or associate Company;

(b) Who have or had no pecuniary relationship with the company, its holding, subsidiary or associate company or their promoters or directors, during the two immediately preceding financial years or during the current financial year;

(c) None of whose relatives has or had pecuniary relationship or transaction with the company, its holding, subsidiary or associate company or their promoters, or directors, amounting to two percent or more of its gross turnover of total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year;

(d) Who, neither himself nor any of his relatives -

(i) holds or has held the position of a key managerial personnel or is or has been employee of the company or its holding, subsidiary or associate company in any of the three financial year immediately preceding the financial year in which he is proposed to be appointed;

(ii) is or has been an employee or propriety or a partner, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed, of

(A) a firm of auditors/company secretaries in practice or cost auditors or the company or its holding, subsidiary or associate company; or

(B) any legal or a consulting firm that has or had any transaction with the company, its holding, subsidiary or associate company amounting to ten percent or more of the gross turnover of such firm;

(iii) holds together with his relative two per cent, or more of the total voting power of the company; or

(iv) Is a Chief Executive or director, by whatever name called, of any nonprofit organization that receives twenty-five percent or more of its receipts from the company, any of its promoters, directors or its holding, subsidiary or associate company or that holds two per cent or more of the total voting power of the company; or

(e) who possesses such other qualification as may be prescribed.

22. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The particulars of Loans given, Investments made and corporate guarantees extended by the company as covered under the provisions of Section 186 of the Companies Act, 2013 are given note 2 & 3 in Financial Statements.

23. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

C.G. Ispat Private Limited is a Associate Company of Vaswani Industries Limited within the meaning of Section 2(6) of the Companies Act, 2013 (Act) as on 31st March, 2019. There are no other subsidiary companies or joint venture companies. There has been no material change in the nature of the business of the Associate Company. Pursuant to the provisions of Section 129(3) of the Act, a statement containing salient features of the Financial Statements of the Associate Companies in Form AOC-1 is furnished in Annexure-E and is attached to this Report.

24. RELATED PARTY TRANSACTIONS

A detailed report on contracts and arrangements made during the year 2018-19, being arms length transactions have been mentioned in Form AOC-2 herewith as Annexure-F.

25. RISK MANAGEMENT POLICY IMPLEMENTATION

In todays economic environment, Risk Management is an important part of business. The main aim of risk management is to identify, monitor and take precautionary measures in respect of the events that may pose risks for the business. Your Companys risk management is embedded in the business processes. The Risk Management Policy is being displayed on our website www.vaswaniindustries.com.

26. NOMINATION AND REMUNERATION POLICY

Companys Policy on Directors appointment and Remuneration including criteria for determining qualification, positive attributes, independence of directors and other matters provided under section 178(3) of the Companies Act, 2013 is attached herewith as Annexure-G.

27. AUDIT COMMITTEE COMPOSITION

The Audit Committee consists of four directors including three Independent Directors and one Executive Director and all have adequate financial literacy.

28. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Discharging Corporate Social Responsibility (CSR) is now statutorily recognized in India. Section 135 of Companies Act, 2013 specifies that: Every company having net worth of Rs 500 crore or more, or turnover of Rs.1000 crore or more, or net profit of Rs.5 crore or more during any of the three preceding financial years (as per circular no. 21/2014 dated June 18, 2014) should spend, in every financial year, at least 2 per cent of the average net profits of the company made during the three immediately preceding financial years. Your company is not covered by any of the conditions mentioned above.

29. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti harassment policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaint Committee are set up at shop floor level to redress complaints received regularly and are monitored by women line supervisors who directly report to the Chairman & Managing Director. All employees (permanent, contractual, temporary, trainees) are covered under the policy. There was no complaint received from any employee during the financial year 2018-19 and hence no complaint is outstanding as on 31.03.2019 for redressal.

30. MEETING OF BOARD OF DIRECTORS

The Board of Directors met eleven (11) times during the year under review. Proper notices of the meeting were given to all the Directors and intimation were duly made to Stock Exchange regarding the conducting of the Board Meeting and its outcome. The details of which are given in the Corporate Governance Report.

31. DIRECTORS AND KEY MANAGERIAL PERSON

In accordance with Section 152(6)(c) of the Companies Act, 2013, Smt. Sudha Vaswani retires by rotation and being eligible offer himself for re-appointment. Shri Ravi Kumar Vaswani Managing Director of the company is disqualified under Section 164 of the Companies Act, 2013 with effect from 01/11/2016 to 31/10/2021 due to Strike off of Elite Buildhome Limited by ROC, Chhattisgarh. Shri Pawan Kumar Jha, Director of the Company is disqualified under section 164 of the Companies Act, 2013 with effect from 01/11/2016 to 31/10/2021 due to Strike off of Elite Buildhome Limited by ROC, Chhattisgarh.

32. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) read with Rule 5 (1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company and the Statement showing the names and other particulars of the employees of the company as required under Rule 5 (2 & 3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is furnished and the employees of the company has received remuneration in excess of the remuneration mentioned in the above mentioned Rule 5(2) during the financial year 2017-18 is given in Annexure-H.

33. MANAGEMENT DISCUSSION AND ANALYSIS REPORTS:

Management Discussion and Analysis reports is enclosed as Annexure-I and should be treated as a part of this report.

34. ANNUAL EVALUATION OF BOARD, ETC.

The Nomination and Remuneration Committee has formulated criteria for evaluation of the performance of the each of the directors of the company. On the basis of said criteria, the Board and all its committees and directors have been evaluated by the Board of the directors and Independent Directors of the Company.

35. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

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

36. CORPORATE GOVERNANCE

Company continues to practice good Corporate Governance over the time. The board lays strong emphasis on transparency, accountability and integrity for building investor confidence, improving investors protection and maximizing long-term shareholder value. Pursuant to provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, a separate section on corporate governance practices followed by the Company, together with a certificate from the Companys Auditors confirming compliance forming an integral part of this Report is given as Annexure-J.

37. ACKNOWLEDGEMENT

The Board takes this opportunity to sincerely thank all its stakeholders namely, shareholders, customers, suppliers/contractors, bankers, employees, government agencies, local authorities, and the immediate society for their un-stinted support and co-operation during the year.

For and on behalf of the Board of Directors
Sd/- Sd/-
Yashwant Vaswani Sudha Vaswani
(Whole-time Director) (Director)
Place: Raipur Date: 30/05/2019