Zodiac Energy Ltd Directors Report.
The Board of Directors hereby submits the report of the business and operations of your Company (the Company), along with the audited financial statements, for the financial year ended March 31, 2019.
|Financial Highlights:||(Amount in Lakhs)|
|Particulars||F.Y. 2018-19||F.Y. 2017-18|
|Revenue from Operations||6328.00||3838.97|
|Less: Total Expenses before Depreciation, Finance Cost and Tax||5850.87||3531.49|
|Profit before Depreciation, Finance Cost and Tax||491.38||314.74|
|Less: Finance Cost||27.86||26.80|
|Profit Before Tax||452.24||274.93|
|Less: Current Tax||140.85||78.45|
|Less: Deferred tax Liability||(2.82)||(6.10)|
|Less: Pervious year tax adjustment||4.10||2.99|
|Profit after Tax||310.12||199.60|
During the year under review, the revenue from operation of the Company was stood at 6328.00 Lakhs as compared to 3838.97Lakhs during the financial year 2017-2018 which states around 64.84% robust growth in the revenue. Your Company has recorded total income to the tune of 6342.25 Lakhs during the financial year 2018-19 compared to 3846.23 Lakhs in the corresponding previous financial year. During the year, your Company generated earnings before interest, depreciation and tax (EBIDTA) of 491.38 Lakhs as compared to 314.74 Lakhs in the previous year. The net profit after tax stood at 310.12 Lakhs during the current financial year 2018-19 as compared to 199.60 Lakhs in the previous financial year 2017-18 which states 55.37% hike in the profit. Our profit increased majorly due to economies of scale achieved and increase in sale of goods during the year. Moreover, our administrative expenses were decreased as compared to previous financial year. Also, our total expenditures not increased in proportion of increase in our revenue. We were in position to negotiate for better rates from our suppliers as a result our profit for the current financial year has robust growth.
Your director has recommended final dividend of Rs2.5 per equity share for the financial year 2018-19.
Transfer to General Reserve:
Your Directors do not propose transfer of any amount to the General Reserves. Full amount of net profit is carried to reserve& Surplus account of the Company.
Change in Nature of Business:
During the year, your Company has not changed its business or object and continues to be in the same line of business as per main object of the Company.
During the year under review there were no changes have taken place in the authorized and paid-up share capital of the Company:
The Authorized Capital of the Company is Rs7,50,00,000/- divided into 7500000 Equity Shares of Rs 10/- each.
Issued, Subscribed & Paid-up Capital
The present Paid-up Capital of the Company is Rs7,31,67,200/- divided into 7316720 Equity Shares of Rs10/- each.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Our Board of Directors has appointed Mr. Pranav Mehta as a Chairman Emeritus of the Company with effect from September 16, 2017. Mr. Pranav Mehta is a well-respected name, in India as well as other countries, in the area of Solar Energy for his dedicated advocacy and action for wide spread solar penetration and sustainable growth, not only with the governments but also the corporate sector and he continues to work in the policy advocacy and supporting environmental activities in India and elsewhere in the other countries.
Constitution of Board:
As on the date of this report, the Board comprises following Directors;
|No. of Committee1|
|Name of Director||Category Cum Designation||Date of Appointment at current Term & designation||Total Directorship2||in which Director is Members||in which Director is Chairman||No. of Shares held as on March 31, 2019|
|Mr. Kunjbihari Shah||Managing Director||September 08,2017||1||2||-||4391520 Equity Shares|
|Ms. Parul Shah||Whole-Time Director||September 08,2017||1||-||-||212400 Equity Shares|
|Mr. Kamlesh Mistry||Whole-Time Director||September 08,2017||1||-||-||-|
|Mr. Bhargav Mehta||Whole-Time Director||September 26,2017||1||-||-||-|
|Mr. Jugalkishor Shah||Non- Executive Director||September 22,2018||2||-||-||692000 Equity Shares|
|Mr. Dhaval Shah||Independent Director||September 22,2018||3||1||1||-|
|Mr. Kalpesh Joshi||Independent Director||September 22,2018||2||3||1||-|
1Committee includes Audit Committee and Shareholders Grievances Committee across all Public Companies.
2Excluding LLPs, Section 8 Company & struck of Companies
The composition of Board complies with the requirements of the Companies Act, 2013 (Act). Further, in pursuance of Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the Company is exempted from requirement of having composition of Board as per Regulation 17 of Listing Regulations.
None of the Directors of Board is a member of more than ten Committees or Chairman of more than five committees across all the Public companies in which they are Director. The necessary disclosures regarding Committee positions have been made by all the Directors. None of the Director of the Company is serving as a Whole-Time Director or Managing Director in any Listed Company and is holding position of Independent Director in more than 3 Listed Company and none of the Director of the Company is holding position as Director in more than eight listed entities and none of the Director is serving as Independent Director in more than 7 Listed Company.
None of the Directors of the Company is disqualified for being appointed as Director as specified in Section 164 (2) of the Companies Act, 2013.
The Board of the Company regularly meets to discuss various Business opportunities. Additional Board meetings are convened, as and when requires discussing and deciding on various business policies, strategies and other businesses. During the year under review, Board of Directors of the Company met 9(Nine) times viz on April 11,2018; May 09, 2018; May 23, 2018; July 03,2018; August 28, 2018; November 11,2018; December 20,2018; February 13, 2019 and February 21,2019. The details of attendance of each Director at the Board Meetings are given below;
|Name of Director||Date of Original Appointment||Date of Appointment at current Designation||Date of Cessation||Number of Board Meetings Eligible to attend||Number of Board Meetings attended|
|Mr. Kunjbihari Shah||June 22,1992||September 08,2017||-||09||09|
|Ms. Parul Shah||April 01,1998||September 08,2017||-||09||09|
|Mr. Kamlesh Mistry*||February 21,2014||September 08,2017||*||09||09|
|Mr. Bhargav Mehta||September 26,2017||September 26,2017||-||09||04|
|Mr. Jugalkishor Shah||September 08,2017||September 22,2018||-||09||08|
|Mr. Kalpesh Joshi||September 08,2017||September 22,2018||-||09||06|
|Mr. Dhaval Shah||September 08,2017||September 22,2018||-||09||09|
*Up to August 31, 2019.
The gap between two consecutive meetings was not more than one hundred and twenty days as provided in section 173 of the Act. During the year, the Board of Directors has also passed resolutions through circulation in compliance of Section 175 of the Companies Act, 2013. All such resolutions, passed through circulation, have been noted in subsequent Board Meeting and form part of minutes of such subsequent meetings.
In terms of Section 149 of the Companies Act, 2013 and rules made there under, the Company has two Non-Promoter Non-Executive Independent Directors in line with the act. A separate meeting of Independent Directors was held on February 21, 2019 to review the performance of Non-Independent Directors and Board as whole and performance of Chairperson of the Company including assessment of quality, quantity and timeliness of flow of information between Company management and Board. The Company has received necessary declaration from each independent director under Section 149 (7) of the act that they meet the criteria of independence laid down in Section 149 (6) of the act.
Information on Directorate:
During the year under review, there were no changes took place in the composition of board of directors of the Company.
In accordance with the provisions of the Articles of Association and Section 152 of the Companies Act, 2013, Ms. Parul Shah, Whole Time Director of the Company retires by rotation at the ensuing annual general meeting. She, being eligible, has offered herself for re-appointment as such and seeks re-appointment. The Board of Directors recommends her appointment on the Board.
The relevant details, as required under Regulation 36 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI Listing Regulations), of the person seeking re-appointment/ appointment as Director are also provided in Note No. 15 of the Notice convening the 27th annual general meeting.
Key Managerial Personnel:
During the year under review, Mr. Rameshkumar Shah, who has acting as Chief Financial officer of the Company has tendered his resignation w.e.f. April 11, 2018. The Board placed on record its appreciation for the service rendered by Mr. Rameshkumar Shah during his tenure in the Company. The Board of Directors in their meeting held on April 11, 2018 has appointed Ms. Shefali Karar as Chief Financial officer of the Company w.e.f. April 11,2018. In accordance with Section 203 of the Companies Act, 2013, the Company has already appointed Mr. Kunjbihari Shah as a Managing Director of the Company, and Ms. Niyati Parikh as Company Secretary of the Company.
The Board of Directors has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to the provisions of the Act.
o The performance of the board was evaluated by the board, after seeking inputs from all the directors, on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning etc.
o The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc.
o The board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role. Separate meeting of independent directors was held to evaluate the performance of non-independent directors, performance of the board as a whole and performance of the chairman, taking into account the views of executive directors and non-executive directors.
The same was discussed in the board meeting that followed the meeting of the independent directors, at which the performance of the board, its committees and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.
Directors Responsibility Statement:
Pursuant to section 134(5) of the Companies Act, 2013, the board of directors, to the best of their knowledge and ability, confirm that:
a) In preparation of annual accounts for the year ended March 31, 2019, the applicable accounting standards have been followed and that no material departures have been made from the same;
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 or loss of the Company for that year;
c) 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 fraud and other irregularities;
d) The Directors had prepared the annual accounts for the year ended March 31, 2019 on going concern basis.
e) The Directors had laid down the internal financial controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively; and
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.
COMMITTEE OF BOARD
The Board of Directors, in line with the requirement of the act, has formed various committees, details of which are given hereunder.
A. Audit Committee: -
Audit Committee meeting is generally held for the purpose of recommending the half yearly and yearly financial result. Additional meeting is held for the purpose of reviewing the specific item included in terms of reference of the Committee. During the year under review, Audit Committee met 2 (Two) times viz onMay 23,2018and November 14, 2018.The composition of the Committee and the details of meetings attended by its members are given below:
|Number of meetings during the financial year 2018-19|
|Name||Designation||Eligible to attend||Attended|
|Mr. Dhaval Shah||Chairman||2||2|
|Mr. Kalpesh Joshi||Member||2||2|
|Mr. Kunjbihari Shah||Member||2||2|
The Statutory Auditors of the Company are invited in the meeting of the Committee wherever requires. Chief Financial Officer of the Company is a regular invitee at the Meeting. Recommendations of Audit Committee, wherever/whenever given, have been accepted by the Board.
The Company has established a vigil mechanism and accordingly framed a Whistle Blower Policy. The policy enables the employees to report to the management instances of unethical behavior, actual or suspected fraud or violation of Companys Code of Conduct. Further the mechanism adopted by the Company encourages the Whistle Blower to report genuine concerns or grievances and provide for adequate safe guards against victimization of the Whistle Blower who avails of such mechanism and also provides for direct access to the Chairman of the Audit Committee, in exceptional cases. The functioning of vigil mechanism is reviewed by the Audit Committee from time to time. None of the Whistle blowers has been denied access to the Audit Committee of the Board. The Whistle Blower Policy of the Company is available on the website of the Company at www.zodiacenergy.com.
B. Stakeholders Grievance & Relationship Committee:
Stakeholders Grievance & Relationship Committee mainly to focus on the redressal of Shareholders / Investors Grievances, if any, like Transfer / Transmission / Demat of Shares; Loss of Share Certificates;
Non-receipt of Annual Report; Dividend Warrants; etc. The Stakeholders Relationship Committee shall report to the Board on a quarterly basis regarding the status of redressal of complaints received from the shareholders of the Company.
During the year under review, Stakeholders Grievance & Relationship Committee met 4(Four) times viz on May 23, 2018; August 28, 2018; November 14,2018 and February 13, 2019.The composition of the Committee and the details of meetings attended by its members are given below:
|Number of meetings during the financial year 2018-19|
|Name||Designation||Eligible to attend||Attended|
|Mr. Kalpesh Joshi||Chairman||4||4|
|Mr. Dhaval Shah||Member||4||4|
|Mr. Kunjbihari Shah||Member||4||4|
During the year, the Company had not received any complaints from the Shareholders. There was no complaint pending as on March 31, 2019.
C. Nomination and Remuneration Committee:
Nomination and Remuneration Committee meetings are generally held for identifying the persons who are qualified to become Directors and may be appointed in senior management and recommending their appointments and removal. Further, the committee shall also meet as and when the need arises for review of Managerial Remuneration. During the year under review, Nomination and Remuneration Committee met3 (Three) times viz on April 11, 2018; August 28, 2018 and February 21, 2019. The composition of the Committee and the details of meetings attended by its members are given below:
|Number of meetings during the financial year 2018-19|
|Name||Designation||Eligible to attend||Attended|
|Mr. Dhaval Shah||Chairman||3||3|
|Mr. Kalpesh Joshi||Member||3||3|
|Mr. Jugalkishor Shah||Member||3||3|
Nomination and Remuneration Policy:
Nomination and Remuneration Policy in the Company is designed to create a high-performance culture. It enables the Company to attract motivated and retained manpower in competitive market, and to harmonize the aspirations of human resources consistent with the goals of the Company. The Company pays remuneration by way of salary, benefits, perquisites and allowances to its Managing Director and the Executive Directors. The Nomination and Remuneration Policy, as adopted by the Board of Directors, is placed on the website of the Company at www.zodiacenergy.com and is annexed to this Report as Annexure A.
Remuneration of Directors:
The details of remuneration paid during the financial year 2018-19 to Directors of the Company is provided in Form MGT-9 which is the part of this report.
The company has not accepted any deposits from the public. Hence, the directives issued by the Reserve Bank of India & the Provision of Section 73 to 76 of the Company Act, 2013 or any other relevant provisions of the Act and the Rules there under are not applicable.
PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS & SECURITY
Details of Loans, Guarantees, Investments and Security covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statement.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT-9 is annexed to this Report as Annexure-B and the same has also been uploaded on the website of the Company www.zodiacenergy.com.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2 is annexed to this Report as Annexure C.
DISCLOSURE OF REMUNERATION:
The ratio of the remuneration of each whole-time director, Managing Director to the median of employees remuneration as per Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed to this Report as Annexure D. Refer to tables 3A(a) in Annexure D.
Additionally, the following details form part of Annexure Dto this Report: o Statement containing the names of top 10 employees in terms of remuneration drawn. (Refer to table 3B(a)).
o Details of employees posted in India throughout the fiscal and in receipt of a remuneration of Rs 1.02 crore or more per annum. (Refer to table 3B(b)).
o Details of employees posted in India for part of the year and in receipt of Rs 8.5 lakh or more a month. (Refer to table 3B(c)).
o Employees employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company. (Refer to table 3B(d)).
o The details of employees posted outside India and in receipt of a remuneration of Rs 60 lakh or more per annum or Rs 5 lakh or more per month Not Applicable since the Company has no such employee.
MATERIAL CHANGES AND COMMITMENT:
There are no material changes and commitments, affecting the financial position of the Company, have occurred between the ends of financial year of the Company i.e. March 31, 2019 to the date of this Report. However, on March 30, 2019 Adani Solar has partnered with your Company for retail distribution business of solar panels in Gujarat. Your Company will be Adani Solars Exclusive Channel Partner for Gujarat.This partnership is aimed at facilitating consumers and SME, MSME or institutions in Gujarat to switch to sustainable solar power at among the lowest capex cost. Directors of your Company expects this partnership may result in increase in sales for your Company and also the visibility of Zodiac Energy across the renewable energy spectrum will be improved due to strong presence of Adani Solar in Indian Renewable Energy Segment.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE:
To foster a positive workplace environment, free from harassment of any nature, we have institutionalized the Anti-Sexual Harassment Initiative (ASHI) framework, through which we address complaints of sexual harassment at the all workplaces of the Company. Our policy assures discretion and guarantees non-retaliation to complainants. We follow a gender-neutral approach in handling complaints of sexual harassment and we are compliant with the law of the land where we operate. During the year under review, there were no incidences of sexual harassment reported.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act read with rule 8 of The Companies (Accounts) Rules, 2014, as amended from time to time is annexed to this Report as Annexure -E.
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate it. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:
Your Company has an effective internal control system, which ensures that all the assets of the Company are safeguarded and protected against any loss from unauthorized use or disposition. The Internal Auditors of the Company carry out review of the internal control systems and procedures. The internal audit reports are reviewed by Audit Committee. Your Company has also put in place adequate internal financial controls with reference to the financial statements commensurate with the size and nature of operations of the Company. During the year, such controls were tested and no material discrepancy or weakness in the Companys internal controls over financial reporting was observed.
Your Company strives to incorporate the appropriate standards for corporate governance. However, pursuant to Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company is not required to mandatorily comply with the provisions of certain regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and therefore the Company has not provided a separate report on Corporate Governance, although few of the information are provided in this report under relevant heading.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
In terms of Regulation 34, and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a review of the performance of the Company, for the year under review, Management Discussion and Analysis Report, is presented in a separate section forming part of this Annual Report.
STATUTORY AUDITOR AND THEIR REPORT:
Pursuant to the provisions of Section 139 of the Companies Act, 2013 read with rules made thereunder, M/s. Manubhai & Shah LLP, Ahmedabad (FRN: 106041W/W100136), were appointed as Statutory Auditors of the Company to hold office till conclusion of the 30th Annual General Meeting(AGM) of the company to be held in the calendar year 2022. The Notes to the financial statements referred in the Auditors Report are self-explanatory and therefore do not call for any comments under Section 134 of the Companies Act, 2013. The Auditors Report does not contain any qualification, reservation or adverse remark. The Auditors Report is enclosed with the financial statements in this Annual Report.
REPORTING OF FRAUD:
The Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.
SECRETARIAL AUDITOR AND THIEIR REPORT:
Pursuant to the provisions of Section 204 of the Act read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company has appointed Mr. Anand Lavingia, Practicing Company Secretary, Ahmedabad to conduct the Secretarial Audit of the Company for the financial year 2018-19. The Secretarial Audit Report is annexed herewith as Annexure E to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remarks as on March 31, 2019.
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act and Rule 8 of The Companies (Accounts) Rules, 2014 to the extent the transactions took place on those items during the year. Your Directors further 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:
1. Details of Annual Report on Corporate Social Responsibility as Company is not falling within the criteria as prescribed u/s 135 of the Companies Act, 2013
2. Issue of Equity Shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme and ESOS.
4. 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.
Your Directors wish to place on record their sincere appreciation for significant contributions made by the employees at all levels through their dedication, hard work and commitment, enabling the Company to achieve good performance during the year under review. Your Directors also take this opportunity to place on record the valuable co-operation and support extended by the banks, government, business associates and the shareholders for their continued confidence reposed in the Company and look forward to having the same support in all future endeavors.
|Registered office:||By order of the Board of Directors|
|U.G.F 4-5-6, Milestone Building, Nr.||For,||ZODIAC ENERGY LIMITED|
|Khodiyar Restaurant, Nr. Drive-In||CIN:||L51909GJ1992PLC017694|
|Cinema, Thaltej, Ahmedabad 380 054,|
|Kunjbihari Shah||Parul Shah|
|Place: Ahmedabad||Managing Director||Whole Time Director|
|Date: August 31, 2019||DIN 00622460||DIN 00378095|