Mar 31, 2016
Dear Shareholders,
The Directors have the pleasure in presenting the 32nd Annual Report and the Audited Accounts of the Company for the year ended 31st March, 2016.
FINANCIAL HIGHLIGHTS1
(Rupees in Lac)
2016 |
2015 |
|
Total Turnover |
164,660.61 |
154,293.01 |
Other Income |
702.79 |
656.17 |
Profit Before Interest, Depreciation and Taxation |
24,964.08 |
23,367.30 |
Less: 1. Interest |
11,729.21 |
9,701.26 |
2. Depreciation |
4,013.60 |
3764.42 |
Profit Before Taxation |
9,221.27 |
9,901.62 |
Less: Provision for Taxation |
||
Current Tax |
3.218.28 |
3,353.19 |
Deferred Tax |
220.93 |
150.74 |
Net Profit for the Year |
5,782.07 |
6,397.68 |
Less: Income Tax paid for earlier year |
69.07 |
125.42 |
Profit after Taxation |
5,713.00 |
6,272.26 |
Add: Balance of Profit from earlier years |
33,952.16 |
29,341.58 |
Amount available for Appropriations |
39,665.16 |
35,613.85 |
Add: Transfer from Debenture Redemption Reserve |
475.00 |
100.00 |
Less: Dividend (Proposed)1 |
662.48 |
662.48 |
Tax on distributed Profits2 |
134.88 |
134.89 |
Transitional provision for depreciation as per schedule II of the Companies Act, 2013 (Net of Deferred Tax Liability) |
- |
164.32 |
Transfer to General Reserve |
- |
800.00 |
Balance carried forward |
39,342.80 |
33,952.16 |
Note:
1 The Hon''ble High Court of Judicature at Bombay had vide its order dated 29th March, 2016 effective from 1st April, 2016, approved the Scheme of Arrangement ("Scheme") between Mandhana Industries Limited ("MIL") and The Mandhana Retail Ventures Limited ("MRVL") and their respective Shareholders and Creditors, pursuant to which the Retail Business of MIL has been demerged and transferred into MRVL from the appointed date viz. 1st April, 2014. Consequent of the demerger, the financial figures of the discontinued Retail Business of MIL is not included for current as well as previous period.
COMPANY PERFORMANCE AND BUSINESS OVERVIEW
During the year under review, the textiles and garments segment grew at a rate of 6.18% and 12.54% respectively, which resulted in your company achieving sales of Rs. 164,660.61 Lac, reflecting a growth of approximately 6.72% over the last fiscal. EBIDTA margin has marginally increased to 14.73% vis-a-vis 14.72%. The net profit for the year has decreased because of the increase in the interest expenses and longer working capital cycle, it has decreased from Rs. 6,272.26 Lac to Rs. 5,713.00 Lac. The margins for both the segments have become more competitive.
The management has taken several measures to ensure better management of working capital, monitoring of project performance on continuous basis and completion of projects as per schedule to avoid cost and time over run.
A detailed discussion of operations for the year ended 31st March, 2016 is provided in the Management Discussion and Analysis Report, which is presented in a separate section forming part of this Annual Report.
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR 2015-16
During the year under review, the Hon''ble High Court of judicature at Bombay had, vide its order dated 29th March, 2016 sanctioned the Scheme of Arrangement ("Scheme") between Mandhana Industries Limited ("MIL/ Company") and The Mandhana Retail Ventures Limited (formerly Mandhana Retail Ventures Limited) ("MRVL") and their respective shareholders and creditors under Section 391 to 394 read with Sections 100 to 103 of the Companies Act, 1956. Pursuant to the Scheme, the retail business of MIL has been demerged and transferred into MRVL with effect from the Appointed Date i.e. 1st April, 2014.
DIVIDEND
In view of supplication of proposed Strategic Debt Restructuring, the Board of the Directors has rescinded the dividend recommended for the financial year ended 31st March, 2016.
CORPORATE GOVERNANCE
Reports on Corporate Governance and Management Discussion and Analysis, in accordance with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), along with a certificate from Auditors regarding compliance of the Corporate Governance are given separately in this Annual Report.
All Board members and senior management personnel have affirmed compliance with the code of conduct for the year 2015-16. A declaration to this effect signed by the Chairman and Managing Director of the Company is contained in this annual report.
PUBLIC DEPOSIT
Your Company has not accepted any public deposits under Chapter V of Companies Act, 2013.
NON CONVERTIBLE DEBENTURES (NCDs)
An aggregate amount of Rs. 19,00,00,000/- (Rupees Nineteen Crore only) towards Secured Redeemable Non-Convertible Debentures (NCDs) issued by the Company, has been redeemed during the year 2015-16 in accordance with terms of the issue of the NCDs. The details of outstanding NCDs as on 31st March, 2016 are provided in annexure to Note No. 3 on Long Term Liabilities forming part of Financial Statements contained in the Annual Report.
IDBI Trusteeship Services Limited is the Debenture Trustee for the Debenture holders whose details are provided in the Corporate Governance Section of the Annual Report.
The applicable listing fees have been paid to the stock exchanges.
DIRECTORS
In accordance with the provisions of the Companies Act, 2013, Mr. Manish B. Mandhana retires by rotation at the ensuing Annual General Meeting and is eligible for reappointment. The information as required to be disclosed under Regulation 36(3) of Listing Regulations, in case of reappointment of directors, is provided in the notice of the ensuing annual general meeting. The Board of Directors has recommended his reappointment for consideration of the shareholders.
Mr. Biharilal C. Mandhana has resigned as a Director of the Company with effect from 10th June, 2016 on account of his ailing health. The Company places on record the valuable contribution of Mr. Biharilal C. Mandhana during his extensive tenure as Director with the Company.
Mr. Ghyanendra Nath Bajpai, Mr. Khurshed M. Thanawalla, Mr. Dilip G. Karnik and Mr. Prashant Asher have resigned as the Directors of the Company with effect from 25th June, 2016, 7th September, 2016, 27th June, 2016 and 7th September, 2016 respectively. Mr. Khurshed M. Thanawalla resigned as a Director of the Company in view of his decision to reduce his work and his formal business commitments. Mr. Ghyanendra Nath Bajpai, Mr. Dilip G. Karnik and Mr. Prashant Asher has tendered their resignation on account of their pre-occupations and prior commitments. The Company places on record the valuable contribution made by all the aforesaid Directors during their tenure as Directors with the Company.
The Company is in the process of identifying suitable and experienced persons to be appointed for the office of the Independent Directors and is expected to finalize the persons to hold the said offices in the coming days.
For the year 2015-16, the Company has received declarations from all its erstwhile Independent Directors, confirming that they meet the criteria of independence as mentioned under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges and relevant provisions of the Listing Regulations.
BOARD EVALUATION
Evaluation of performance of all Directors is undertaken annually. The Company has implemented a system of evaluating performance of the Board of Directors and of its Committees and individual Directors on the basis of a structured questionnaire which comprises evaluation criteria taking into consideration various performance related aspects.
The Board of Directors has expressed their satisfaction with the evaluation process.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the year 4 Board Meetings were convened and held, details of which are given in the Corporate Governance Report section.
VIGIL MECHANISM / WHISTLE BLOWER POLICY FOR DIRECTORS AND EMPLOYEES
The Company has established a Vigil Mechanism, which includes a Whistle Blower Policy, for its Directors and Employees, to provide a framework to facilitate responsible and secure reporting of concerns of unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct & Ethics. The Whistle Blower Policy is posted on the website of the Company and the web-link to the same is http://www.mandhana.com/ investorRelation.php
AUDIT COMMITTEE
The Audit Committee for the Financial Year ended 31st March, 2016 comprised of five members viz. 4 Independent Directors and 1 Executive Director, given as under: *Mr. Ghyanendra Nath Bajpai, Mr. Khurshed M. Thanawalla, Mr. Dilip G. Karnik and Mr. Prashant K. Asher have ceased to be Directors and consequently as members of the Audit Committee with effect from 25th June, 2016, 7th September, 2016,27th June, 2016 & 7th September, 2016, respectively.
Further details on the Audit Committee are provided in the Corporate Governance Section.
NOMINATION AND REMUNERATION POLICIES
The Board of Directors has formulated a Policy which lays down a framework for selection and appointment of Directors and Senior Management and for determining qualifications, positive attributes and independence of Directors.
The Board has also formulated a Policy relating to remuneration of Directors, members of Senior Management and Key Managerial Personnel.
Details of the Nomination and Remuneration Policy are given under Annexure - ''D'' to this Report.
RISK MANAGEMENT POLICY
The Company has a robust Risk Management framework to identify, measure and mitigate business risks and threats. This framework seeks to create transparency, minimize adverse impact on the business objective and enhance the Company''s competitive advantage. This risk framework thus helps in managing market, credit and operations risks and quantifies exposure and potential impact at a Company level.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
No loans, guarantees or Investments covered under sections 186 of the Companies Act, 2013, have been given or provided during the year.
RELATED PARTY TRANSACTIONS
All contracts/arrangements/transactions entered by the Company during the financial year with related parties were in ordinary course of business and on arm''s length basis. During the year, the Company had not entered into any contract/arrangement/ transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC 2 is not applicable.
Prior omnibus approval of the Audit Committee has been obtained on an annual basis for transactions with related parties which are of a foreseeable and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted and a statement giving details of all transactions with related parties are placed before the Audit Committee for their review on a periodic basis.
MANAGERIAL REMUNERATION
Remuneration to Directors and Key Managerial Personnel
i. The percentage increase in remuneration of each Director and Company Secretary during FY2015-16, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for FY 2015-16 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:
Sr. No. |
Name of Director /KMP and Designation |
Remuneration of Director/ KMP for FY 2015-16 (In Rupees) |
% increase in remuneration in FY 2015-16 |
Ratio of remuneration of each Whole Time Director to median remuneration of employees |
Comparison of the remuneration of KMP against Company''s performance |
1 |
Mr. Purushottam C. Mandhana -Chairman & Managing Director |
2,43,99,600 |
0% |
214.96 |
Profit after tax for FY 2015-16 is Rs. 5,782.07 Lac as against Rs. 6,397.68 Lac in FY 2014-15. |
2 |
Mr. Biharilal C. Mandhana -Executive Director |
73,83,600 |
0% |
65.05 |
|
3 |
Mr. Manish B. Mandhana -Joint Managing Director |
1,70,91,600 |
0% |
150.58 |
|
4 |
Mrs. Sangeeta M. Mandhana-Non-Executive Director |
50,000 |
N.A. |
N.A. |
N.A. |
5 |
Mr. Ghyanendra Nath Bajpai-Independent Director* |
4,75,000 |
N.A. |
N.A. |
N.A. |
6 |
Mr. Khurshed M. Thanawalla -Independent Director* |
5,00,000 |
N.A. |
N.A. |
N.A. |
7 |
Mr. Dilip G. Karnik - Independent Director* |
3,75,000 |
N.A. |
N.A. |
N.A. |
8 |
Mr. Prashant K. Asher -Independent Director* |
4,50,000 |
N.A. |
N.A. |
N.A. |
9 |
Mr. Vinay Sampat - Vice President - Legal & Company Secretary |
23,54,028 |
17.60% |
N.A. |
Profit after tax for FY 2015-16 is Rs. 5,782.07 Lacs as against Rs. 6,397.68 Lacs in FY 2014-15. |
*Mr. Ghyanendra Nath Bajpai, Mr. Khurshed M. Thanawalla, Mr. Dilip G. Karnik and Mr. Prashant K. Asher has ceased to be Directors with effect from 25th June, 2016, 7th September, 2016, 27th June, 2016 & 7th September, 2016, respectively.
Note: Remuneration paid to each Whole-Time Director and KMP includes Salary, allowances, company''s contribution to provident fund and monetary value of perquisites, if any. The remuneration paid to Non-Executive and/or Independent Directors comprises of sitting fees only.
ii. The median remuneration of employees of the Company for the financial year ended 31st March, 2016 was Rs. 1,13,508/-;
iii. In the financial year under review, there was an increase of 9.67% in the median remuneration of employees;
iv. There were 7,570 permanent employees on the rolls of the Company as on 31st March, 2016;
v. Average percentage decline in the salaries of employees other than the managerial personnel in the last financial year i.e. FY2015-16 was 1.37% as compared to FY 2014-15. No change has happened in the Managerial Remuneration as regards comparison of Managerial Remuneration over the said periods.
vi. I t is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
STATUTORY AUDITORS AND AUDITORS'' REPORT
M/s. Vishal H. Shah & Associates, Chartered Accountants stepped down as the Statutory Auditors of the Company w.e.f. 8th September, 2016 on account of their pre-occupation. Subsequently, in accordance with Sec 139 of the Companies Act, 2013, the Board of Directors of the Company in its meeting held on 2nd December, 2016 has recommended M/s. KPND & Co., Chartered Accountants (FRN: 133861W), to act as Statutory Auditors of the Company for a period of 5 years to hold office until the conclusion of the 37th Annual General Meeting of the Company in calendar year 2021. In accordance with the provisions of Section 139, 142 and other applicable provisions of the Companies Act, 2013 and of the Companies (Audit and Auditors) Rules, 2014, the appointment of the Statutory Auditors is required to be ratified by the shareholders at every Annual General Meeting during their tenure. M/s. KPND & Co., Chartered Accountants, have confirmed that they are eligible to act as the Statutory Auditors.
With regard to the outstanding Tax liability, the payment got delayed in view of the tax implications involved in contemplation of demerger of Retail Business of the Company to MRVL. Since, the demerger of the retail Business of the Company was approved by the Hon''ble High Court of Judicature at Bombay vide its order dated 29th March, 2016, effective from 1st April, 2016, the said Income Tax Liability was to be segregated and paid based on the respective revised Income Tax Returns of both, the Demerged and Resulting Companies separately. With regard to delay in repayment of dues to the bank, as mentioned in the Auditor''s Report, we hereby state that the Bank of Baroda (lead Bank) has accorded its in-principle approval for supplication of Strategic Debt Restructuring (SDR) of the Company and majority of members bank have agreed to such invocation of SDR. The other statements made by the Auditors in their Report are self - explanatory and do not call for any further comments.
COST AUDIT REPORT
M/s. Babulal M. Parihar & Co., Cost Accountants have been duly appointed as Cost Auditors by the Board of Directors for conducting Cost Audit in respect of products manufactured by the Company which are covered under the Cost Audit Rules for current financial year ending 31st March, 2017. They were also the Cost Auditor for the previous financial year ended 31st March, 2016. As required by Section 148 of the Companies Act, 2013, necessary resolution has been included in the Notice convening the Annual General Meeting, seeking ratification by Members to the remuneration proposed to be paid to the Cost Auditors for the financial year 31st March, 2016.
The Company has filed the Cost Audit Report for the year ended 31st March, 2016 with the Central Government within the prescribed time.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 2013, and the Rules made there under, the Company has appointed Mr. Nitin R. Joshi, Practicing Company Secretary (Certificate of Practice No. 1884 and Membership No.FCS-3137) as the Secretarial Auditor of the Company. The Secretarial Audit Report is annexed as Annexure - ''E'' and forms an integral part of this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Mr. Purushottam C. Mandhana, Chairman & Managing Director possesses extensive proficiency for financial and risk management operations garnered through his association with the Company from its inception and vast experience in the textile industry. He also heads the Finance Department of the Company and performing required duties and functions of a Chief Financial Officer. CORPORATE SOCIAL RESPONSIBILITY The Annual Report on Corporate Social Responsibility activities for FY 2015-16 is enclosed as Annexure - ''C''
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company has no subsidiary, Joint Venture and Associate Company as on 31st March, 2016.
SIGNIFICANT EVENTS AFTER BALANCE SHEET DATE
The Company had entered into global exclusive Brand License Agreement with "Being Human - The Salman Khan Foundation" on 23rd December, 2010 effective from 1st January, 2011 to use trademark & logo of "Being Human" for all clothes range/clothing lines. Post approval of the Scheme, the Company and The Salman Khan Foundation agreed to terminate the erstwhile Brand License Agreement vide Termination Agreement dated 24th August, 2016 and simultaneously MRVL has entered into global exclusive Trademark License Agreement on even date to design, manufacture, retail and distribute men''s wear, women''s wear and accessories under "Being Human" trademark.
In terms of the Scheme, MRVL were required to issue and allot to each of the eligible members of MIL whose name was recorded as beneficial owners in depositories at the close of working hours on 23rd September, 2016 ("Record Date") and as shareholders in the register of members of MIL as on that date in the ratio of 2 equity shares of MRVL for every 3 equity shares held by the equity shareholder in MIL. Accordingly, the Board of Directors of MRVL had on 27th September, 2016 allotted Equity Shares to those shareholders of MIL whose names appeared in the Register of Members as on the Record Date mentioned herein above.
Majority of the consortium of lenders from whom the Company has raised term loan/working capital have agreed to invoke Strategic Debt Restructuring on 26th October, 2016 considering 24th June, 2016 as a reference date subject to receiving in-principle approval from their respective sanctioning authorities.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls in place with reference to financial statements. These are continually reviewed by the Company to strengthen the same wherever required. The internal control systems are supplemented by internal audit carried out by an independent firm of Chartered Accountants and periodical review by management. The Audit Committee of the Board addresses issues raised by both, the Internal Auditors and the Statutory Auditors.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements under sub section (3)(c) and (5) of Section 134 of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that;
i) in the preparation of the annual accounts for the financial year ended 31st March, 2016, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;
ii) the Directors have 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 affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the Directors have prepared the annual financial statements on a going concern basis;
v) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
vi) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
PARTICULARS OF EMPLOYEES
Details of employee remuneration as required under provisions of Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in Annexure - A forming part of this Report. PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE AND OUTGO
Particulars of Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo as per section 134(3)(2) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 for the year ended March 31, 2015 are provided under Annexure - ''B'' to this report.
EXTRACT OF ANNUAL RETURN
The extract of the Annual Return in Form MGT-9 is provided under Annexure - ''F'' forming part of this Report.
OTHERS
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:
1. The details relating to deposits, covered under Chapter V of the Act, since neither has the Company accepted deposits during the year under review nor were there any deposits outstanding during the year.
2. Details relating to issue of equity shares including sweat equity shares, stock options, and shares with differential rights as to dividend, voting or otherwise, since there was no such issue of shares.
3. None of the Whole-Time Directors of the Company received any remuneration or commission from any of its subsidiaries.
Your Directors further state that during the year under review, there were no cases filed under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
ACKNOWLEDGEMENT
The Directors take this opportunity to thank the Shareholders, Financial Institutions, Banks, Customers, Suppliers, Regulators, Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the employees at all levels for their hard work, dedication and commitment.
For and on behalf of the Board of Directors
PURUSHOTTAM C. MANDHANA
(Chairman and Managing Director)
Place : Mumbai
Dated: 2nd December, 2016
Mar 31, 2015
Dear Shareholders,
The Directors have the pleasure in presenting the 31st Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2015.
FINANCIAL HIGHLIGHTS
(Rs.in Lacs)
2015 2014
Total Turnover 168,497.75 151,793.76
Other Income 748.31 (301.51)
Profit Before Interest, Depreciation
and Taxation 27,813.10 23,737.24
Less: Interest 10,775.88 9,697.21
Depreciation 3,999.63 2,918.71
Profit Before Taxation 13,037.59 11,121.32
Less: Provision for Taxation
Current Tax 4,412.95 3,292.46
Deferred Tax 190.62 801.43
Net Profit for the Year 8,434.02 7,027.43
Less: Income Tax paid for earlier year 125.42 1,103.17
Profit after Taxation 8,308.60 5,924.26
Add: Balance of Profit from earlier
years 31,549.84 27,450.65
Amount available for Appropriations 39,858.44 33,374.91
Add: Transfer from Debenture Redemption
Reserve (Net of Deferred Tax Liability) 100.00 -
Less: Dividend (Proposed) 662.48 662.48
Tax on distributed Profits 134.89 112.59
Transitional provision for depreciation
as per Schedule II of the Act 164.32 -
(Net of Deferred tax)
Transfer to Debenture Redemption Reserve - 250.00
Transfer to General Reserve 800.00 800.00
Balance carried forward 38,196.76 31,549.84
COMPANY PERFORMANCE AND BUSINESS OVERVIEW
During the year under review, the textiles and garments segment grew at
a balanced rate of 9.94% and 10.79%, which resulted in your company
achieving sales of Rs.168,497.75 lacs, reflecting a growth of
approximately 11.00% over the last fiscal. EBIDTA margin increased to
16.06% vis-Ã -vis 15.84% due to sustained expansion of Brand "Being
Human" in the product sales mix and therefore garment segment rising
faster than textiles. The net profit for the year increased from
Rs.7,027.43 lacs last year to Rs.8,434.02 lacs this year replicating steady
growth of 4.63% from last year to 5.01% in the current year. The
margins for both the segments have become more competitive.
The management has taken several measures to ensure better management
of working capital, monitoring of project performance on continuous
basis and completion of projects as per schedule to avoid cost and time
over run.
A detailed discussion of operations for the year ended 31st March, 2015
is provided in the Management Discussion and Analysis Report, which is
presented in a separate section forming part of this Annual Report.
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR 2014-15
With a view to unlock the valuation of the Company's Retail Operation
segment, the Board of Directors of the Company at its meeting held on
22nd November, 2014 decided to demerge its retail business of brand
'Being Human'("the Retail Business") into a separate company viz.
Mandhana Retail Ventures Limited ("MRVL"), to be listed post demerger,
subject to sanction of the High Court of judicature at Bombay /
National Company Law Tribunal and other statutory/regulatory
authority(ies) as may be required. It has decided to transfer the
Retail Business along with all its assets and liabilities into MRVL. It
has been further decided to transfer all the properties, assets,
liabilities etc. of the Retail Business at the value appearing in its
books of accounts immediately before the demerger. Appointed Date of
demerger has been proposed to be 1st April, 2014. The Company has filed
draft Scheme of Arrangement/Demerger along with all the required
documents with BSE Limited and National Stock Exchange of India
Limited.
It is further proposed that shareholders of the Company shall receive 2
equity shares of MRVL for every 3 equity shares held in the Company in
accordance with the valuations determined by the Valuation Expert.
DIVIDEND
The Company is pleased to report that the Board has recommended a final
dividend of Rs.2/- per equity share of Rs.10/- each fully paid-up i.e. 20%
for the financial year ended 31st March, 2015. The final dividend will
absorb an amount of Rs.662.48 Lacs (excluding Dividend Distribution tax
of Rs.134.89 Lacs).
CORPORATE GOVERNANCE
The Board believes and reaffirms its commitment to transparency and
high level of corporate governance practices to discharge their
stewardship responsibilities. A corporate Governance Report is annexed
to Director's Report and Auditors'Certificate regarding compliance of
the Corporate Governance is made part of Annual Report.
All Board members and senior management personnel have affirmed
compliance with the code of conduct for the year 2014-15. A declaration
to this effect signed by the Chairman and Managing Director of the
Company is contained in this annual report.
PUBLIC DEPOSIT
Your Company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
NON CONVERTIBLE DEBENTURES (NCDs)
40 Secured Redeemable Non-Convertible Debentures (NCDs) of Rs.10,00,000/-
each aggregating to Rs.4,00,00,000/- have been redeemed during the year
in accordance with terms of the issue. The details of outstanding NCDs
as on 31st March, 2015 are provided in annexure to Note No. 3 on Long
Term Liabilities forming part of Financial Statements contained in the
Annual Report.
IDBI Trusteeship Services Limited is the Debenture Trustee for the
Debenture holders whose details are provided in the Corporate
Governance Section of the Annual Report.
The applicable listing fees have been paid to the stock exchanges.
DIRECTORS
Mr. Sanjay Asher has resigned as a Director of the Company with effect
from 30th September, 2014 in order to meet the requirements of limit on
number of directorships laid under the provisions of the Companies Act,
2013 and amended Clause 49 of the Listing Agreements notified by
Securities and Exchange Board of India vide its circular dated April
17, 2014. The Company places on record the valuable contribution of
Mr. Sanjay Asher during his tenure as Director.
Pursuant to recommendation of the Nomination & Remuneration Committee,
the Board of Directors vide circular resolution dated 3rd November,
2014 appointed Mr. Prashant Asher as Additional Director (Non-Executive
and Independent Director) of the Company, who holds office up to the
date of this Annual General Meeting, under the provisions of Article
151 of the Articles of Association of the Company and Sections 149,
150, 152 and 161 read with Schedule IV and all other applicable
provisions, if any, of the Companies Act, 2013 and the Rules framed
there under and Clause 49 of the Listing Agreements. Necessary details
have been annexed to the notice of the meeting in terms of Section
102(1) of the said Act.
The Company has received declarations from all its Independent
Directors, confirming that they meet the criteria of independence as
prescribed under the Companies Act, 2013 and Clause 49 of the Listing
Agreement with the Stock Exchanges.
In accordance with the provisions of the Companies Act, 2013, Mr.
Purushottam C. Mandhana retires by rotation at this Annual General
Meeting and is eligible for re-appointment. The information as
required to be disclosed under Clause 49 of the Listing Agreement in
case of re-appointment of directors is provided in the notice of the
ensuing annual general meeting. The Board of Directors has recommended
his reappointment for consideration of the shareholders.
BOARD EVALUATION
Evaluation of performance of all Directors is undertaken annually. The
Company has implemented a system of evaluating performance of the Board
of Directors and of its Committees and individual Directors on the
basis of a structured questionnaire which comprises evaluation criteria
taking into consideration various performance related aspects.
The Board of Directors has expressed their satisfaction with the
evaluation process.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the year 5 Board Meetings were convened and held, details of
which are given in the Corporate Governance Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY FOR DIRECTORS AND EMPLOYEES
The Company has established a Vigil Mechanism, which includes a Whistle
Blower Policy, for its Directors and Employees, to provide a framework
to facilitate responsible and secure reporting of concerns of unethical
behavior, actual or suspected fraud or violation of the Company's Code
of Conduct & Ethics. The Whistle Blower Policy is posted on the
website of the Company and the web-link to the same is http://www.
mandhana.com/investorrelations.html
AUDIT COMMITTEE
The Audit Committee comprises of five members viz. 4 Independent
Directors and 1 Executive Director, given as under:
1. Mr. Khurshed M. Thanawalla - Chairman
2. Mr. Ghyanendra Nath Bajpai
3. Mr. Prashant K. Asher
4. Mr. Dilip G. Karnik
5. Mr. Purushottam C. Mandhana
Further details on the Audit Committee are provided in the Corporate
Governance Section of the Annual Report.
NOMINATION AND REMUNERATION POLICIES
The Board of Directors has formulated a Policy which lays down a
framework for selection and appointment of Directors and Senior
Management and for determining qualifications, positive attributes and
independence of Directors.
The Board has also formulated a Policy relating to remuneration of
Directors, members of Senior Management and Key Managerial Personnel.
Details of the Nomination and Remuneration Policy are given under
Annexure - 'D'to this Report.
RISK MANAGEMENT POLICY
The Company has a robust Risk Management framework to identify, measure
and mitigate business risks and threats. This framework seeks to create
transparency, minimize adverse impact on the business objective and
enhance the Company's competitive advantage. This risk framework thus
helps in managing market, credit and operations risks and quantifies
exposure and potential impact at a Company level.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
No loans, guarantees or Investments covered under section 186 of the
Companies Act, 2013, have been given or provided during the year.
RELATED PARTY TRANSACTIONS
All contracts/arrangements/transactions entered by the Company during
the financial year with related parties were in ordinary course of
business and on arm's length basis.
During the year, the Company had not entered into any
contract/arrangement/ transaction with related parties which could be
considered material in accordance with the policy of the Company on
materiality of related party transactions. Accordingly, the disclosure
of Related Party Transactions as required under Section 134(3)(h) of
the Companies Act, 2013 in Form AOC 2 is not applicable.
Post October 1, 2014, prior omnibus approval of the Audit Committee has
been obtained on an annual basis for transactions with related parties
which are of a foreseeable and repetitive nature. The transactions
entered into pursuant to the omnibus approval so granted and a
statement giving details of all transactions with related parties are
placed before the Audit Committee for their review on a periodic basis.
MANAGERIAL REMUNERATION
Remuneration to Directors and Key Managerial Personnel
i. The percentage increase in remuneration of each Director and Company
Secretary during FY2014-15, ratio of the remuneration of each Director
to the median remuneration of the employees of the Company for FY
2014-15 and the comparison of remuneration of each Key Managerial
Personnel (KMP) against the performance of the Company are as under:
Sr. Name of Director /KMP and Remuneration of % increase in
No. Designation Director/ KMP for remuneration in
FY 2014-15 FY 2014-15
(Rs.)
1 Purushottam C. Mandhana 2,43,99,600 0.17%
- Chairman & Managing
Director
2 Biharilal C. Mandhana 73,83,600 0.35%
- Executive Director
3 Manish B. Mandhana 1,70,91,600 0.24%
- Joint Managing Director
4 Ghyanendra Nath Bajpai 4,30,000 Note 1
- Independent Director
5 Sanjay K. Asher 80,000 Note 2
- Independent Director
6 Khurshed M. Thanawalla 4,30,000 Note 1
- Independent Director
7 Dilip G. Karnik 3,05,000 Note 1
- Independent Director
8 Sangeeta M. Mandhana 50,000 Note 3
- Non-Executive Director
9 Prashant K. Asher 3,25,000 Note 4
- Independent Director
10 Vinay Sampat 20,00,616 19.24%
- Company Secretary
Name of Director Ratio of remuneration of Comparison of the
each Whole-Time Director remuneration of KMP
to median remuneration of against Company's
employees performance
Purushottam C.
Mandhana 235.74 Profit after tax
for FY 2014-15 is
Rs.8,434.02
Biharilal C.Mandhana 71.34
Lacs as against
Rs.7,027.43 Lacs in
FY 2013-14.
Manish B.Mandhana 165.14
Ghyanendra Nath Bajpai N.A. N.A.
Sanjya K.Asher N.A. N.A.
Khurshed M.Thanawalla N.A. N.A.
Dilip G.Karnik N.A. N.A.
Sangeeta M.Mandhana N.A. N.A.
Prashant K.Asher N.A. N.A.
Vinay Sampat N.A. Profit after tax
for FY 2014-15 is
Rs.8,434.02 Lacs
as against
Rs.7,027.43 Lacs
in FY 2013-14.
Note 1: Pursuant to Section 197 of the Companies Act, 2013, a Company
may pay sitting fees to Directors up to Rs.1 Lakh per meeting for each of
the meetings of the Board and Committees thereof attended by them. At
the Board Meeting held on 14th November, 2014, sitting fees payable to
the Non-Executive Directors for attending Board and Audit Committee
Meetings was increased to Rs.50,000/- eacRs. and Rs.25,000/- each for other
Committee meetings attended as against Rs.20,000/- for Board Meetings and
Rs.10,000/- for Committee Meetings fixed by the Board at its meeting held
on 7th March, 2008. In view of this, the remuneration paid to the
Independent Directors for FY2014- 15 is not comparable to the
remuneration paid in FY2013-14.
Note 2: Mr. Sanjay K. Asher has ceased to be Director with effect from
30th September, 2014 and hence the remuneration paid to Mr. Sanjay K.
Asher for FY2014-15 is not comparable to the remuneration paid in
FY2013-14.
Note 3: Mrs. Sangeeta Mandhana appointed as Additional Director with
effect from 5th August, 2014 and her appointment as Non-Executive
Director was approved by the Members at the Annual General Meeting held
on 18th September, 2014 and hence the remuneration paid to Mrs.
Sangeeta Mandhana for FY2014-15 is not comparable to the remuneration
paid in FY2013-14.
Note 4: Mr. Prashant K. Asher appointed as Additional Director with
effect from 3rd November, 2014 and hence the remuneration paid to Mr.
Prashant K. Asher for FY2014-15 is not comparable to the remuneration
paid in FY2013-14.
Note 5: Remuneration paid to each Whole-Time Director and KMP includes
Salary, allowances, company's contribution to provident fund and
monetary value of perquisites, if any. The remuneration paid to
Non-Executive and/or Independent Directors comprises of sitting fees
only.
ii. The median remuneration of employees of the Company during
FY2014-15 was Rs.1,03,500/-;
iii. In the financial year under review, there was an increase of
10.58% in the median remuneration of employees;
iv. There were 5,175 permanent employees on the rolls of the Company
as on 31st March, 2015;
v. Relationship between average increase in remuneration and Company's
performance
The increase in median remuneration of employees was 10.58%. As regards
Company's performance, its Profit after Tax (PAT) for the financial
year 2014-15 was Rs.8,434.02 Lakh as against PAT of Rs.7,027.43 Lakh for
the financial year 2013-14.
Remuneration to Employees is as per the HR Policy of the Company in
force from time to time and in compliance with applicable regulatory
requirements. Total remuneration comprises fixed pay, perquisites,
retiral benefits and performance pay. Performance Pay, which is the
variable component of remuneration and comprises a significant portion
of total remuneration is, amongst other factors, linked to Company's
performance.
vi. a) Variations in the market capitalisation of the Company The
market capitalisation as on March 31, 2015 was Rs.87,844.62 Lakh
(Rs.76,549.36 lakh as on March 31, 2014).
b) Price Earnings Ratio of the Company was Rs.10.57 as at March 31, 2015
and was Rs.12.92 as at March 31, 2014.
vii. Percent increase over/ decrease in the market quotations of the
shares of the company as compared to the price at which the last public
offer was made
The last offer of shares to the public was made in May, 2010, which was
the Initial Public Offer of 83,00,000 equity shares of Rs.10/- each at a
price of Rs.130/- per share. As against this, the average closing price
of the Company's equity shares on the Stock Exchange for FY 2014-15 was
Rs.248.85. which represents the increase of 91.42% over the IPO offer
price.
viii. Average percentage increase made in the salaries of employees
other than the managerial personnel in the last financial year i.e.
FY2014-15 was 14.86%. Average percentage increase in managerial
personnel in the last financial year i.e. FY 2014-15 was 0.22%.
Increase in the managerial remuneration is in accordance with the
ordinary resolutions passed at the Annual General Meeting of the
Company held on 19th September, 2013.
ix. Key parameters for the variable component of remuneration availed
by Directors Not Applicable.
x. The ratio of the remuneration of the highest paid director to that
of the employees who are not directors but receive remuneration in
excess of the highest paid director during the year Not Applicable
xi. It is hereby affirmed that the remuneration paid is as per the
Remuneration Policy for Directors, Key Managerial Personnel and other
Employees.
STATUTORY AUDITORS AND AUDITORS REPORT
In accordance with Sec 139 of the Companies Act, 2013, M/s. Vishal H.
Shah & Associates, Chartered Accountants, Firm Registration no. 116422W
were re-appointed by the shareholders of the Company at the Annual
General Meeting held on September 18, 2014, as Statutory Auditors for a
period of 3 years to hold office until the conclusion of the 33rd
Annual General Meeting of the Company in calendar year 2017. In
accordance with the provisions of Section 139, 142 and other applicable
provisions of the Companies Act, 2013 and of the Companies (Audit and
Auditors) Rules, 2014, the appointment of the Statutory Auditors is
required to be ratified by the shareholders at every Annual General
Meeting during their tenure. M/s. Vishal H. Shah & Associates,
Chartered Accountants, have confirmed that they are eligible for having
their appointment as Statutory Auditors if ratified at this Annual
General Meeting.
The Auditors Report does not contain any qualification, reservation or
adverse remark on the financial statements for the year ended 31st
March, 2015. The statements made by the Auditors in their Report are
self - explanatory and do not call for any further comments.
COST AUDIT REPORT
The Cost Audit report for the year ended March 31, 2014 was due on
September 30, 2014 and was filed by M/s. Joshi Apte and Associates,
Cost Accountants, on 16th September, 2014.
The Companies (cost records and audit) Rules, 2014 were notified by the
Ministry of Corporate Affairs (MCA) on 30th June, 2014. As per these
rules the textile sector was out of purview of cost audit. However, the
MCA amended the said rules by the Companies (Cost Records and Audit)
Amendment Rules, 2014 notified on 31st December, 2014. As per amended
rules the CETA Heading 5004 to 5007; 5106 to 5113; 5205 to 5212; 5303;
5310; 5401 to 5408; 5501 to 5516 for Textile Sector is covered under
the scope of applicability of cost records and audit thereof effective
1st April 2015.
M/s. Babulal M. Parihar & Co., Cost Accountants, have been duly
appointed as Cost Auditors by the Board of Directors of the Company at
its meeting held on 13th August, 2015 for conducting Cost Audit in
respect of products manufactured by the Company which are covered under
the Cost Audit Rules for current financial year ending 31st March,
2016. As required by Section 148 of the Companies Act, 2013, necessary
resolution has been included in the Notice convening the Annual General
Meeting, seeking ratification by Members to the remuneration proposed
to be paid to the Cost Auditors for the financial year 31st March,
2016.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 2013,
and the Rules made there under, the Company has appointed Mr. Nitin R.
Joshi, Practicing Company Secretary (Certificate of Practice No. 1884
and Membership No.FCS-3137) as the Secretarial Auditor of the Company.
The Secretarial Audit Report is annexed as Annexure  'E'and forms an
integral part of this Report.
The Secretarial Audit Report does not contain any qualification,
reservation or adverse remark.
Mr. Purushottam C. Mandhana, Chairman & Managing Director possesses
extensive proficiency in financial and risk management operations
garnered through his association with the Company from its inception
and vast experience in the textile industry. He also heads the Finance
Department of the Company and performing required duties and functions
of a Chief Financial Officer.
CORPORATE SOCIAL RESPONSIBILITY
The Annual Report on Corporate Social Responsibility activities for FY
2014-15 is enclosed as Annexure  'C'.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company has no subsidiary, Joint Venture and Associate Company as
on 31st March, 2015.
SIGNIFICANT EVENTS AFTER BALANCE SHEET DATE
No material changes and commitments have taken place which may have
impact on the financial position of the Company after the Balance Sheet
date i.e. 31st March, 2015 till the date of this report.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls in place with
reference to financial statements. These are continually reviewed by
the Company to strengthen the same wherever required. The internal
control systems are supplemented by internal audit carried out by an
independent firm of Chartered Accountants and periodical review by
management. The Audit Committee of the Board addresses issues raised by
both, the Internal Auditors and the Statutory Auditors.
DIRECTORS'RESPONSIBILITY STATEMENT
Pursuant to the requirements under sub section (3)(c) and (5) of
Section 134 of the Companies Act, 2013, with respect to Directors'
Responsibility Statement, it is hereby confirmed that;
i) in the preparation of the accounts for the financial year ended 31st
March, 2015, the applicable Accounting Standards have been followed
along with proper explanation relating to material departures;
ii) the Directors have 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 affairs
of the Company at the end of the financial year and of the profit of
the Company for the year under review;
iii) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 2013 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) the Directors have prepared the annual financial statements on a
going concern basis;
v) the Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and operating effectively; and
vi) the Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and operating effectively.
PARTICULARS OF EMPLOYEES
Details of employee remuneration as required under provisions of
Section 197 of the Companies Act, 2013 and Rule 5(2) & 5(3) of
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014 is provided in Annexure - A forming part of this Report.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO
Particulars of Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo as per section 134(3) (2) of the
Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 for
the year ended March 31, 2015 are provided under Annexure  'B'to this
report.
EXTRACT OF ANNUAL RETURN
The extract of the Annual Return in Form MGT-9 is provided under
Annexure - 'F'forming part of this Report.
OTHERS
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:
1. The details relating to deposits, covered under Chapter V of the
Act, since neither has the Company accepted deposits during the year
under review nor were there any deposits outstanding during the year.
2. Details relating to issue of equity shares including sweat equity
shares, stock options, and shares with differential rights as to
dividend, voting or otherwise, since there was no such issue of shares.
3. None of the Whole-Time Directors of the Company received any
remuneration or commission from any of its subsidiaries.
4. No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company's
operations in future.
Your Directors further state that during the year under review, there
were no cases filed under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.
ACKNOWLEDGEMENT
The Directors take this opportunity to thank the Shareholders,
Financial Institutions, Banks, Customers, Suppliers, Regulators,
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work, dedication and commitment.
For and on behalf of the Board of Directors
Place: Mumbai PURUSHOTTAM C. MANDHANA
Dated:13th August, 2015 (Chairman and Managing Director)
Mar 31, 2014
Dear Shareholders,
The Directors have the pleasure in presenting the 30th Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2014.
FINANCIAL HIGHLIGHTS
(Rs in Lacs)
2014 2013
Total Turnover 151,793.76 136,306.36
Other Income (301.51) (454.62)
Profit Before Interest, Depreciation and 23,737.24 19,299.23
Taxation
Less: 1. Interest 9,697.21 7,059.32
2. Depreciation 2,918.71 2,624.21
Profit Before Taxation 11,121.32 9,615.70
Less: Provision for Taxation
Current Tax 3,292.46 2,423.05
Deferred Tax 801.43 638.76
Net Profit for the Year 7,027.43 6,553.90
Less: Income Tax paid for earlier year 1,103.17 20.08
Profit after Taxation 5,924.26 6,533.82
Add : Balance of Profit from earlier years 27,450.65 24,236.81
Amount available for Appropriations 33,374.91 30,770.63
Less: Dividend (Proposed) 662.48 662.48
Tax on distributed Profits 112.59 107.47
Transfer to Debenture Redemption Reserve 250.00 1,750.00
Transfer to General Reserve 800.00 800.00
Balance carried forward 31,549.84 27,450.67
The Companies Bill 2012 got its assent in the Lok Sabha on 18th
December, 2012 and in the Rajya Sabha on 8th August, 2013 and after
receiving the assent of the President of India on 29th August, 2013, it
has now become the Companies Act, 2013 ("the Act") which replaced the
Companies Act, 1956. However, this report pertains to financial year
that commenced prior to 1 st April, 2014, the contents therein are
governed by the
relevant provisions / schedules / rules of the Companies Act, 1956, in
compliance with General Circular No. 08/2014 dated 4th April, 2014
issued by the Ministry of Corporate Affairs.
COMPANY PERFORMANCE AND BUSINESS OVERVIEW
During the year under review, the textiles and garments segment grew at
a balanced rate of 9.12% and 21.67%, which
resulted in your company achieving sales of Rs. 151,793.76 lacs,
reflecting a growth of approximately 11.36% over the last fiscal.
EBITDA margin increased to 15.83% vis-a-vis 14.49% due to sustained
expansion of Brand "Being Human" in the product sales mix and therefore
garment segment rising faster than textiles. The net profit for the
year increased from Rs. 6,535.89 lacs last year, to Rs. 7,027.43 lacs this
year. The slender increase of 4.63% in net profit was mainly
attributable to various factors especially the income tax paid in this
fiscal for the earlier years. Also, the rupee and the commodity price
fluctuation alongwith interest rates have impacted the net profit. The
margins for both the segments have become more competitive.
The management has taken several measures to ensure better management
of working capital, monitoring of project performance on continuous
basis and completion of projects as per schedule to avoid cost and time
over run.
Highlights of performance and business overview are discussed in detail
in Management Discussion and Analysis forms part of this Annual Report.
DIVIDEND
The Company is pleased to report that the Board has recommended a final
dividend of 20% for the financial year ended 31st March, 2014. The
final dividend will absorb an amount of Rs. 662.48 Lacs (excluding
Dividend Distribution tax ofRs. 112.59 Lacs).
CORPORATE GOVERNANCE
The Board believes and reaffirms its commitment to transparency and
high level of corporate governance practices to discharge their
stewardship responsibilities. A corporate Governance Report is annexed
to Directors'' Report and Auditors'' Certificate regarding compliance of
the Corporate Governance is made part of Annual Report.
All Board members and senior management personnel have affirmed
compliance with the code of conduct for the year 2013-14. A declaration
to this effect signed by the Chairman and Managing Director of the
Company is contained in this annual report.
SEBI vide its Circular No.CIR/CFD/POLICY CELL/2/2014 dated 17th April,
2014 has notified the revised Clause 49 of the Listing Agreement to be
applicable with effect from 1st October, 2014. This Report therefore
stands complied against the previous Clause 49 of the Listing
Agreement.
PUBLIC DEPOSIT
Your Company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
N0N CONVERTIBLE DEBENTURES (NCDS)
The Company has issued and allotted 100 Secured Redeemable
Non-Convertible Debentures (NCDs) of Rs. 10,00,000/- each aggregating to
Rs. 10,00,00,000/-. The same are listed on the Wholesale Debt Market
segment of BSE Limited (BSE) on 21st October, 2013.
The Company had issued and allotted 200 Secured Redeemable
Non-Convertible Debentures (NCDs) of Rs. 10,00,000/- each aggregating to
Rs. 20,00,00,000/- and 500 Secured Redeemable Non-Convertible Debentures
(NCDs) of Rs. 10,00,000/- each aggregating to Rs. 50,00,00,000/- on a
private placement basis on 15th March, 2013 and 28th March, 2013,
respectively in the previous financial year. The same are listed on the
Wholesale Debt Market segment of BSE Limited (BSE) on 3rd April, 2013
and 10th April, 2013, respectively.
IDBI Trusteeship Services Limited is the Debenture Trustee for the
Debenture holders whose details are provided in the Corporate
Governance Section of the Annual Report.
The applicable listing fees have been paid to the stock exchange.
DIRECTORS
Mr. Khurshed M. Thanawalla, Mr. Sanjay K. Asher, Mr. Ghyanendra Nath
Bajpai and Mr. Dilip G. Karnik were appointed as Independent Directors
of the Company under the provisions of the Companies Act, 1956 and were
liable to retire by rotation.
However pursuant to section 149(4) of the Companies Act, 2013 (Act),
which came into effect from 1st April, 2014, every listed public
company is required to have at least one-third of the total number of
directors as Independent Directors. The Board already has half of its
directors in the category of Independent Directors in terms of the
provisions of Clause 49 of the Listing Agreement. The Board therefore,
in its meeting held on 5th August, 2014 appointed the existing
Independent Directors under Clause 49 as ''Independent Directors''
pursuant to provisions of the said Act, subject to the approval of
shareholders at the ensuing annual general meeting. Necessary details
have been annexed to the notice of the meeting in terms of Section
102(1) of the said Act.
The Independent Directors have submitted the Declaration of
Independence, as required under Section 149(6) of the Act, declaring
that they meet the criteria of independence.
In view of the provisions of the Companies Act, 2013 (''Act''), Mr.
Biharilal C. Mandhana has now become retiring director and retires from
the Board by rotation this year and being eligible, offers himself for
re-appointment. The information as required to be disclosed under
Clause 49 of the Listing Agreement in case of re-appointment of
directors is provided in the notice of the ensuing annual general
meeting.
In view of second proviso to Sub section 1 of Section 149 of Companies
Act, 2013 read with Rule 3 of the Companies (Appointment and
Qualification of Directors) Rules, 2014 and the amended clause 49 of
the Listing Agreements effective from 1st October, 2014, the Company
has appointed Mrs. Sangeeta M. Mandhana as an additional Non -
Executive Director on the Board of the Company at its meeting held on
5th August, 2014. Necessary details have been annexed to the notice of
the meeting in terms of Section 102(1) of the said Act.
STATUTORY AUDITORS
M/s. Vishal H. Shah & Associates, Chartered Accountants, who are the
statutory auditors of the Company, hold office till the conclusion of
the forthcoming AGM and are eligible for re-appointment. Pursuant to
the provisions of section 139 of the Companies Act, 2013 and the Rules
framed thereunder, it is proposed to appoint M/s. Vishal H. Shah &
Associates, Chartered Accountants as statutory auditors of the Company
from the conclusion of the forthcoming AGM till the conclusion of the
thirty third AGM to be held in the year 2017, subject to ratification
of their appointment at every AGM.
COST AUDIT REPORT
The Cost Audit report for the year ended 31 st March, 2013 was due on
30th September, 2013 and was filed by M/s. Joshi Apte and Associates,
Cost Accountants, on 27th September, 2013.
M/s Joshi Apte and Associates, Cost Accountants had been appointed as
Cost Auditor for the financial year ended 31st March, 2014. The Cost
Audit Report and compliance report for the financial year ended 31st
March, 2014 is expected to be filed within the prescribed time.
CORPORATE SOCIAL RESPONSIBILITY
Your Company welcomes the initiative taken by the Ministry of Corporate
Affairs with an aim to embrace responsibility for the corporates
actions and encourage a positive impact through its activities on the
environment, consumers, communities including employees and all other
members of the public sphere who may also be considered stakeholders.
Section 135 of the Companies Act, 2013 speaks of Corporate Social
Responsibility (CSR) alongwith the Rules thereunder and revised
Schedule VII were notified on 27th February, 2014 to come into effect
from 1 st April, 2014. As the Company being covered under the
provisions of the said Section, it has formed a Committee of Directors,
titled "Corporate Social Responsibility Committee" at its Board Meeting
held on 20th May, 2014.
Now the Committee has put in place a CSR Policy and the said Committee
would be continuously monitoring the said Policy of the Company.
However, the said Section being enacted with effect from 1st April
2014, necessary details as prescribed under the said Section shall be
presented to the members in the annual report for the year 2014-15.
Even when the said provisions were not mandated by the Ministry of
Corporate Affairs, your company demonstrated a sense of responsibility
towards society and environment. The Company has made green thinking a
part of its business agenda to reduce its carbon footprint, energy &
water conservation, waste reduction and product innovation.
SUBSIDIARIES
The Company has no subsidiary as on 31st March, 2014.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors'' Responsibility Statement, it is
hereby confirmed that;
i) In the preparation of the accounts for the financial year ended 31st
March, 2014, the applicable Accounting Standards have been followed
along with proper explanation relating to material departures;
ii) The Directors have 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 affairs
of the Company at the end of the financial year and of the profit of
the Company for the year under review;
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities; and
iv) The Directors have prepared the accounts for the financial year
ended 31st March, 2014 on a ''going concern'' basis.
PARTICULARS OF EMPLOYEES
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules, 2002 is annexed to this report and forms integral
part of this report.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE AND OUTGO
Particulars with respect to conservation of energy, technology
absorption and foreign exchange earnings and outgo, as per section
217(1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 and forming part of the Directors'' Report for the year ended 31st
March, 2014, are annexed to this report.
ACKNOWLEDGEMENT
The Directors take this opportunity to thank the Shareholders,
Financial Institutions, Banks, Customers, Suppliers, Regulators,
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work, dedication and commitment.
For and behalf of the Board of Directors
Purushottam C. Mandhana
(Chairman and Managing Director)
Place: Mumbai
Dated: 5th August, 2014
Mar 31, 2013
The Directors have the pleasure in presenting the 29th Annual Report
and the Audited Accounts of the Company for the year ended 31st March''
2013.
Financial Highlights
(Rs.in lacs)
2013 2012
Total Turnover 136''306.36 98''014.81
Other Income (454.62) 86.51
Proft Before Interest''
Depreciation and Taxation 19''299.23 18''555.34
Less: 1. Interest 7''059.32 5''904.12
2. Depreciation 2''624.21 2''333.49
Proft Before Taxation 9''615.70 10''317.73
Less: Provision for Taxation
Current Tax 2''423.05 2''087.39
Deferred Tax 638.76 873.75
Less: Income Tax paid for earlier
year 20.08 46.48
Proft after Taxation 6''533.82 7''310.11
Add : Balance of Proft from
earlier years 24''236.81 18''496.65
Amount available for Appropriations 30''770.63 25''806.76
Less: Dividend (Proposed) 662.48 662.48
Tax on distributed
Profts 107.47 107.47
Transfer to Debenture Redemption
Reserve 1''750.00
Transfer to General Reserve 800.00 800.00
Balance carried forward 27''450.67 24''236.81
Company Performance and Business Overview
During the year under review'' your company concentrated in setting up
and operationalizing Brand "Being Human". The export and domestic
market for textiles and garments grew at an evenhanded rate of 38.21%
and 43.11%'' which resulted in your company achieving sales of Rs.
136''306.36 lacs'' refecting a growth of approximately 39.70% over the
last fscal. EBITA increased marginally to Rs. 19''753.85 lacs vis-Ã -vis Rs.
18''155.35 lacs. The net proft of the Company declined from Rs. 7''310.11
lacs last year'' to Rs. 6''533.82 lacs this year'' mainly due to increase in
yarn price'' negative foreign exchange income and higher operating costs
due to launch of retail brand "Being Human".
Your Company foresees a worthy scope in the domestic and exports
markets for its products and also expects to see a signifcant rise in
its income from the retail operations for the next fscal. However''
frequent and wide fuctuations in the foreign currency and high interest
rate regime continue to a challenge.
Your Company has commenced commercial production from its maiden
garment unit facility in Tarapur'' Maharashtra with effect from 1st
March'' 2013.
Highlights of performance and business overview are discussed in detail
in Management Discussion and Analysis forms part of this Annual Report.
Dividend
The Company is pleased to report that the Board has recommended a fnal
dividend of 20 % for the fnancial year ended 31st March'' 2013. The fnal
dividend will absorb an amount of Rs. 662.48 lacs (excluding Dividend
Distribution tax of Rs. 107.45 lacs).
Corporate Governance
The Board believes and reaffrms its commitment to transparency and high
level of corporate governance practices'' to discharge their stewardship
responsibilities.
A Corporate Governance Report is annexed to Director''s Report and
Auditors Certifcate regarding compliance of the Corporate Governance is
made part of Annual Report.
Public Deposit
The Company has not accepted any deposit within the meaning of Section
58A of the Companies Act'' 1956 and rules made thereunder.
Non Convertible Debentures (NCDs)
The Company has issued and allotted 200 Secured Redeemable
Non-Convertible Debentures (NCDs) of Rs. 1''000''000/- each aggregating to
Rs. 200''000''000/- and 500 Secured Redeemable Non-Convertible Debentures
(NCDs) of Rs.1''000''000/- each aggregating to Rs.500''000''000/- on a private
placement basis on 15th March'' 2013 and 28th March'' 2013'' respectively.
Further'' the NCDs allotted on 15th March'' 2013 aggregating to Rs.
200''000''000/- and NCDs allotted on 28th March'' 2013 aggregating to Rs.
500''000''000/-are listed on the Wholesale Debt Market segment of Bombay
Stock Exchange Limited (BSE) on 3rd April'' 2013 and 10th April'' 2013''
respectively.
The applicable listing fees have been paid to the stock exchange.
Directors
Mr. Khurshed M. Thanawalla'' Director of the Company retires from the
Board by rotation in accordance with the provisions of Companies Act''
1956 and the Articles of Association of the Company and being eligible''
offers himself for re- appointment.
The particulars of the Director proposed to be re-appointed are given
in the Corporate Governance Report as annexed to the Directors'' Report
and forms part of Annual Report.
Auditors
M/s. Vishal H. Shah & Associates'' Chartered Accountants'' the Statutory
Auditors of the Company retire at the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. They have
furnished a certifcate pursuant to Section 224(1) of the Companies Act''
1956 regarding their eligibility for re-appointment and your Directors
recommend the re-appointment.
Pursuant to directions from the Department of Company affairs'' M/s
Joshi Apte and Associates'' Cost Accountants have been appointed as Cost
Auditors for the year 2012- 13. In terms of the Cost Audit Rules'' 2011''
the Cost Audit Report''is required to be fled within 180 days from the
end of the fnancial year or as per date notifed by the Ministry of
Corporate Affairs. M/s Joshi Apte and Associates'' Cost Accountants have
also been appointed as Cost Auditors for the year 2013-14.
Directors'' Responsibility Statement
Pursuant to the requirement under Section 217(2AA) of the Companies
Act'' 1956'' with respect to Directors'' Responsibility Statement'' it is
hereby confrmed that;
i) In the preparation of the accounts for the fnancial year ended 31st
March'' 2013'' the applicable Accounting Standards have been followed
along with proper explanation relating to material departures;
ii) The Directors have 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 affairs
of the Company at the end of the fnancial year and of the proft of the
Company for the year under review;
iii) The Directors have taken proper and suffcient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act'' 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) The Directors have prepared the accounts for the fnancial year
ended 31st March'' 2013 on a ''going concern'' basis.
Particulars of Employees
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act'' 1956 read with the Companies (Particulars of Employees)
Rules'' 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules'' 2002 is annexed to this report and forms integral
part of this report.
Particulars of Energy Conservation'' Technology Absorption and Foreign
Exchange and Outgo
Particulars with respect to conservation of energy'' technology
absorption and foreign exchange earnings and outgo'' as per section
217(1) (e) of the Companies Act'' 1956'' read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules''
1988 and forming part of the Directors'' Report for the year ended 31st
March'' 2013'' are annexed to this report.
Corporate Social Objectives
Your Company sees Corporate Social Responsibility as an integral part
of its activities. As a Corporate Citizen'' the Company is dedicated to
a viable development that benefts the communities in interrelating
during the course of business.
Your Company looks to continual improvement and sustainability in
energy conservation'' reduction in pollution and waste generation and
recycling of resources and cost savings.
Acknowledgement
The Directors take this opportunity to thank the Shareholders''
Financial Institutions'' Banks'' Customers'' Suppliers'' Regulators''
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work'' dedication and commitment.
For and behalf of the Board of Directors
Purushottam C.mandhana
(Chairman and Managing Director)
Place : Mumbai
Dated: 6th August'' 2013
Mar 31, 2012
The Directors have the pleasure in presenting the 28th Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2012.
FINANCIAL HIGHLIGHTS
(Rs. in lacs)
2012 2011
Total Turnover 98,014.81 83,829.28
Other Income 86.51 516.19
Profit Before Interest,
Depreciation and Taxation 18,468.83 14,738.31
Less : 1. Interest 5,904.12 3,386.90
2. Depreciation 2,333.49 1,927.72
Profit Before Taxation 10,317.73 9,939.88
(Rs.in lacs) 2012 2011
Less : Provision for Taxation
Current Tax 2,087.39 2,331.14
Deferred Tax 873.75 807.31
Less: Income Tax paid
for earlier year 46.48 126.02
Profit after Taxation 7,310.11 6,675.41
Add : Balance of Profit
from earlier years 18,496.65 13,193.74
Amount available for
Appropriations 25,806.76 19,869.16
Less : Dividend (Proposed) 662.48 662.48
Tax on distributed Profits 107.47 110.03
Transfer to General Reserve 800.00 600.00
Balance carried forward 24,236.81 18,496.65
COMPANY PERFORMANCE AND BUSINESS OVERVIEW
Financial year 2011-12 witnessed another year of high inflation and
interest rate regime, decelerating growth along with slowdown in
international market and investment climate affecting businesses
environment resulting in moderated growth.
Your Company achieved a total turnover of Rs. 98,014.81 lacs for the year
ended 31st March, 2012 as against Rs. 83,829.28 lacs in the previous
year, with EBIDTA at Rs. 18,468.83 lacs against an EBIDTA of Rs. 14,738.31
in the previous year and has earned a net profit of Rs. 7,310.11 lacs
versus Rs. 6,675.41 lacs in the previous year. This represents a growth
of 16.92% in turnover, 25.31% in EBIDTA and 9.51% in terms of net
profit.
Highlights of performance and business overview are discussed in detail
in Management Discussion and Analysis forms part of this Annual Report.
dividend
Your Company had declared and paid an interim Dividend of 10% for the
financial year ended 31st March, 2012 in February, 2012 absorbing an
amount of Rs. 331.24 lacs (excluding Dividend Distribution tax of Rs. 53.74
lacs). The Company is pleased to report that the Board has recommended
a final dividend of 10 % for the financial year ended 31st March, 2012.
The final dividend will absorb an amount of Rs. 331.24 lacs (excluding
Dividend Distribution tax of Rs. 53.74 lacs). The total dividend outflow
for the year 31st March, 2012 aggregating Rs. 662.48 lacs (excluding
Dividend Distribution tax of Rs. 107.48 lacs) represents 20 % of the
Company's paid-up share capital.
CORPORATE GOVERNANCE
The Board reaffirms its commitment to the good corporate governance
practices, which they see as fundamental to discharging their
stewardship responsibilities. The Board strives to provide the right
leadership, strategic oversight and focuses on its resources, strength
and strategies to achieve and maintain sustainable growth and to create
long-term value to all of the Company's Stakeholders.
A corporate Governance Report is annexed to Directors' Report and
Auditors Certificate regarding compliance of the Corporate Governance
is made part of Annual Report.
PUBLIC DEPOSIT
The Company has not accepted any deposit within the meaning of Section
58A of the Companies Act, 1956 and rules made thereunder.
DIRECTORS
Mr. Ernest Robin Cornelius, Director of the Company retires from the
Board by rotation in accordance with the provisions of Companies Act,
1956 and the Articles of Association of the Company and being eligible,
offers himself for re-appointment.
The particulars of the Director proposed to be re-appointed are given
in the Corporate Governance Report as annexed to the Directors' Report
and forms part of Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that;
i) In the preparation of the accounts for the financial year ended 31st
March, 2012, the applicable Accounting Standards have been followed
along with proper explanation relating to material departures;
ii) The Directors have 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 affairs of the Company at the end of the financial year and of the
profit of the Company for the year under review;
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) The Directors have prepared the accounts for the financial year
ended 31st March, 2012 on a 'going concern' basis.
particulars OF EMPLOYEES
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules, 2011 is annexed to this report and forms integral
part of this report.
particulars OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE AND OUTGO
Particulars with respect to conservation of energy, technology
absorption and foreign exchange earnings and outgo, as per section
217(1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 and forming part of the Directors' Report for the year ended 31st
March, 2012, are annexed to this report.
CORPORATE SOCIAL OBJECTIVES
Corporate social Responsibility continues to be an important factor in
the activities of the Company, as Corporate Citizen. The Company is
committed to a sustainable development and constantly making efforts to
carry out initiative that benefits the communities interacting with us
during the course of business.
AUDITORS
M/s. Vishal H. Shah & Associates, Chartered Accountants, the Statutory
Auditors of the Company retire at the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. They have
furnished a certificate pursuant to Section 224(1) of the Companies
Act, 1956 regarding their eligibility for re-appointment and your
Directors recommend the re-appointment.
ACKNOWLEDGEMENT
The Directors take this opportunity to thank the Shareholders,
Financial Institutions, Banks, Customers, Suppliers, Regulators,
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work, dedication and commitment.
For and behalf of the Board of Director
PURUSHOTTAM C.MANDHANA
(Chairman and Managing Director)
PLACE : MUMBAI
DATED : 6th August, 2012
Mar 31, 2011
To The Members
The Directors have the pleasure in presenting the 27th Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2011.
FINANCIAL HIGHLIGHTS
(Rs. In Lacs)
2011 2010
Total Turnover 83,829.28 62,579.10
Other Income 168.53 (1,675.09)
Profit Before Interest,
Depreciation and Taxation 14,906.83 11,028.88
Less: 1. Interest 3,039.23 2,643.12
2. Depreciation 1,927.72 1,725.76
PROFIT BEFORE TAXATION 9,939.88 6,660.00
Less : Provision for Taxation
Current Tax 2,331.14 1,174.58
Deferred Tax 807.31 1,350.85
MAT Recievable - (212.64)
Less: Income Tax paid for
earlier year 126.02 7.13
PROFIT AFTER TAXATION 6,675.41 4,340.08
Add : Balance of Profit
from earlier years 13,193.74 9,834.74
Amount available for Appropriations 19,869,16 14,174.82
Less: Dividend (Proposed) 662.48 496.67
Tax on distributed Profits 110.03 84.41
Transfer to General Reserve 600.00 400.00
BALANCE CARRIED FORWARD 18,496.65 13,193.74
OPERATIONS REVIEW
Despite of increase in competition and rise in yarn prices, your
Company was able to improve its net margins. This was mainly due to
effective control mechanism, installation of new machinery, expansion
of existing divisions, innovations and improvement in productivity and
product mix and other operational parameters.
Your Company achieved a total turnover of Rs. 83,829.28 Lacs for the year
ended 31st March, 2011 as against Rs. 62,579.10 Lacs in the previous
year. The Company has earned a net profit of Rs. 6,675.41 Lacs versus Rs.
4,340.08 Lacs in the previous year. This represents a growth of 33.96%
in turnover and 53.81% in terms of net profit.
Despite of steady increase in cotton and yarn prices throughout the
year, your Company has managed to maintain and achieve better sales and
net margins. The Company has achieved sale ofRs. 68,627.62 Lacs in
domestic market and export sale of Rs. 15,201.67 Lacs as compared to
previous year where domestic market sale was Rs. 50,318.93 Lacs and
export sale was Rs. 12,260.17 Lacs.
The Company is also venturing into retail segment and will be launching
a clothing line of Brand "Being Human" in the forthcoming financial
year.
BUSINESS OVERVIEW
A detailed business review is appended in the Management Discussion and
Analysis Section of Annual Report
DIVIDEND
Your Directors are pleased to report that the Board has recommended a
final dividend of Rs. 2,00 per equity share of Rs. 10/- each (i.e. 20%) for
the financial year ended 31st March, 2011, The final dividend will
absorb an amount ofRs. 662.47 Lacs (excluding Dividend Distribution tax
of Rs. 110.03 Lacs).
SHARE CAPITAL
During the year under review, your Company successfully completed the
Initial Public Offering of its securities. The issue comprised of
83,00,000 equity shares of Rs. 10/- each at a premium of Rs. 120/- per
equity share. The issue was over-subscribed by approximately 6,33
times. The shares were listed on Bombay Stock Exchange
Limited and National Stock Exchange Limited on 19th May, 2010.
CORPORATE GOVERNANCE
Your Company reaffirms its commitment to the good corporate governance
practices, which they see as fundamental to discharging their
stewardship responsibilities. The Board strives to provide the right
leadership, strategic oversight and control environment to produce and
sustain the delivery of value to all of the Company's Shareholders. The
Board applies integrity, principles of good governance and
accountability throughout its activities and each Director brings
independence of character and judgment to the role. All of the Members
of the Board are individually and collectively aware of their
responsibilities to the Company's Stakeholders and the Board keeps its
performance and core governance principles under regular review.
The Company has adopted a Code of Conduct for Directors and Senior
Management. All Directors have affirmed their adherence to the above
Code. The Company has also adopted Code of Conduct for prevention of
Insider Trading as required by SEBI (Prohibition of Insider Trading)
Regulations, 1992. The full text of the Code of Conduct for Directors
and Senior Management and Code of Conduct for prevention of Insider
Trading is displayed on the Company's website.
A corporate Governance Report is annexed to Director's Report and
Auditors Certificate regarding compliance of the Corporate Governance
is made part of Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed review of the operations, performance and future outlook of
the Company and its business is given in the Management Discussion and
Analysis as required under provisions of Clause 49(1V) (f), which forms
part of this report.
PUBLIC DEPOSIT
The Company has not accepted any deposit within the meaning of Section
58A of the Companies Act, 1956 and rules made thereunder.
DIRECTORS
Mr. Sanjay Asher and Mr. Ghyanendra Nath Bajpai, Directors of the
Company retire from the Board by rotation in accordance with the
provisions of Companies Act, 1956 and the Articles of Association of
the Company and being eligible, offers themselves for re-appointment.
The particulars of the Directors' proposed to be re-appointed are given
in the Corporate Governance Report in the Annual Report.
During the year Mr. Ajay Joshi, Non- Executive and Independent Director
resigned from the Board due to personal reasons. Your Company places on
record its appreciation for the guidance and advice on strategic
decisions by the Board during his tenure.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217 (2AA) of the Companies
Act, 1956, with respect to Directors' Responsibility Statement, it is
hereby confirmed that;
i) In the preparation of the accounts for the financial year ended 31st
March, 2011, the applicable Accounting Standards have been followed
along with proper explanation relating to material departures;
ii) The Directors have selected such
accounting policies and applied them consistently and madejudgements
and estimates that were 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 of the Company for the year under
review;
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) The Directors have prepared the accounts for the financial year
ended 31st March, 2011 on a 'going concern' basis.
PARTICULARS OF EMPLOYEES
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules, 2002 is annexed to this report and forms integral
part of this report.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE AND OUTGO
Particulars with respect to conservation of energy, technology
absorption and foreign exchange earnings and outgo, as per section
217(1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 and forming part of the Directors' Report for the year ended 31st
March, 2011, are annexed to this report.
CORPORATE SOCIAL OBJECTIVES
Corporate social Responsibility assumes an important role in the
activities of the Company. Efforts to contain air and water pollution
and health continue to be chosen endeavor. The Company focused on
improving execution by strengthening the process of health, safety and
environment (H.S.E) by internal audits and meetings. Safe work
environment is established and being sustained through a united effort
by all stakeholders concerned
AUDITORS
M/s. Vishal H. Shah & Associates, Chartered Accountants, the Statutory
Auditors of the Company retire at the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. They have
furnished a certificate pursuant to Section 224(1) of the Companies
Act, 1956 regarding their eligibility for re-appointment and your
Directors recommend the re-appointment.
ACKNOWLEDGEMENT
The Directors take this opportunity to thank the Shareholders,
Financial Institutions, Banks, Customers, Suppliers, Regulators,
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work, dedication and commitment.
For and behalf of the Board of Director
PURUSHOTTAM C. MANDHANA
(Chairman and Managing Director)
Place : Mumbai
Dated: 9th August, 2011
Mar 31, 2010
The Directors have the pleasure in presenting the 26th Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2010.
It FINANCIAL HIGHLIGHTS
(Rs. in Lacs)
Particulars 2010 2009
Total Income 60,993.40 46,000.64
Profit Before Interest,
Depreciation and Taxation 11,057.71 8471.18
Less: 1. Interest 2,671.95 1757.14
2. Depreciation 1,725.76 1109.54
Profit Before Taxation 6,660.00 5,604.49
Less: Provision for Taxation
Current Tax 1,174.58 645.40
MAT Receivable (212.64) (15.05)
Deferred Tax 1,350.85 1,285.31
Fringe Benefit Tax - 33.78
Profit after Taxation 4,347.21 3,655.05
Less: Income Tax for
earlier year 7.13 (1.37)
Add: Balance of Profit from
earlier years 9,834.74 6919.81
Amount available for
Appropriations 14,174.82 10,576.23
Less: Dividend (Interim
& Proposed) 496.67 249.15
Tax on distributed Profits 84.41 42.34
Transfer to General Reserve 400.00 450.00
Balance carried forward 13,193.74 9,834.74
- OPERATIONS REVIEW
Your Company achieved a total turnover of Rs.60,993.40 Lacs for the
year ended 31st March, 2010 as against Rs.46,000.64 Lacs in the
previous year. The Company has earned a net profit of Rs.4,347.21 Lacs
versus Rs.3,655.05 Lacs in the previous year. This represents a growth
of 32.59% in turnover and 18.93% in terms of net profit
_ BUSINESS OVERVIEW
A detailed business review is appended in the Management Discussion and
Analysis Section of Annual Report
_ DIVIDEND
Your Directors had declared and paid an interim Dividend of 10% for the
financial year ended 31s1 March, 2010 in February, 2010 absorbing an
amount of Rs.248.24 Lacs (excluding Dividend Distribution tax of
Rs.42.19 Lacs). Your Directors are pleased to report that the Board has
recommended a final dividend of 7.5% for the financial year ended 31st
March, 2010. The final dividend will absorb an amount of Rs.248.43 Lacs
(excluding Dividend Distribution tax of Rs.42.22 Lacs). The total
dividend outflow for the year 31s1 March, 2010 aggregating Rs. 496.67
Lacs (excluding Dividend Distribution tax of Rs.84.41 Lacs) represents
15% of the Companys paid-up share capital.
_ SHARE CAPITAL
During the year under review:
a. 113,25,000 equity shares of Rs. 10 each were issued and allotted as
Bonus shares in the ratio of 1:1 equity shares to the existing members
of the Company.
b. 21,73,913 equity shares of Rs. 10/- each were issued and allotted
to Axis Bank Limited, an Indian private Bank, at a price of Rs. 115/-
per equity share inclusive of share premium of Rs. 105/- per equity
share on preferential basis.
_ CORPORATE GOVERNANCE
In view of the Company being unlisted as on 31st March, 2010 i.e. end
of the financial year 2009-10, the code of Corporate Governance as
provided under Clause 49 of the Listing Agreement would not apply to
the Company. However, your Company reaffirms its commitment to the
good corporate governance practices. A corporate Governance Report is
annexed to Directors Report and Auditors Certificate regarding
compliance of the Corporate Governance is made part of Annual Report.
_ MANAGEMENT DISCUSSION AND ANALYSIS
The Management discussion and Analysis as required under provisions of
Clause 49(IV)(f) is enclosed herewith
_ PUBLIC DEPOSIT
The Company has not accepted any deposit within the meaning of Section
58A of the Companies Act, 1956 and rules made thereunder.
_ DIRECTORS
Mr. Khurshed M. Thanawalla and Mr. Ajay Joshi, Directors of the Company
retire from the Board by rotation in accordance with the provisions of
Companies Act, 1956 and the Articles of Association of the Company and
being eligible, offers themselves for re-appointment.
The particulars of the Directors proposed to be re-appointed are given
in the corporate governance report in the Annual Report.
- DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors Responsibility Statement, it is
hereby confirmed that; i) In the preparation of the accounts for the
financial year ended 31st March,
2010, the applicable accounting standards have been followed along with
proper explanation relating to material departures;
ii) The Directors have selected such accounting policies and applied
them consistently and made judgements and estimates that were
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 of the Company for the year
under review;
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities; iv) The Directors have prepared the accounts for the
financial year ended 31st March, 2010 on a going concern basis.
5 PARTICULARS OF EMPLOYEES
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules, 2002 is annexed to this report and forms integral
part of this report.
_ PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE AND OUTGO
Particulars with respect to conservation of energy, technology
absorption and foreign exchange earnings and outgo, as per section
217(1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 and forming part of the Directors Report for the year ended 31s1
March, 2010, are annexed to this report.
_ CORPORATE SOCIAL OBJECTIVES
Corporate social Responsibility assumes an important role in the
activities of the Company. Efforts to contain air and water pollution
and health continue to be chosen endeavor.
_ AUDITORS
M/s. Vishal H. Shah & Associates, Chartered Accountants, the Statutory
Auditors of the Company retire at the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. They have
furnished a certificate pursuant to Section 224(1) of the Companies
Act, 1956 regarding their eligibility for re-appointment and your
Directors recommend the re-appointment.
_ ACKNOWLEDGEMENT
The Directors take this opportunity to thank the shareholders,
Financial Institutions, Banks Customers, Suppliers, Regulators,
Government Authorities - Central and State Government & Local.
The Directors also wish to place on record their appreciation of the
employees at all levels for their hard work, dedication and commitment.
For and behalf of the Board of Director
PURUSHOTTAM C.MANDHANA
(Chairman and Managing Director)
Place: Mumbai
Dated: 13th August, 2010
Mar 31, 2009
The Directors have the pleasure in presenting the 25th Annual Report
and the Audited Accounts of the Company for the year ended 31st March,
2009.
FINANCIAL HIGHLIGHTS
(Rupees in Lacs)
2009 2008
Total Turnover 46,000.64 41,232.02
Profit Before Interest, Depreciation
and Taxation 8,471.18 7,765.84
Less: Interest 1,757.14 1,451.94
Depreciation 1,109.54 907.32
Profit Before Taxation 5,604.49 5,406.59
Less : Provision for Taxation
Current Tax 630.35 1,351.21
Deferred Tax 1,285.31 493.35
Fringe Benefit Tax 33.78 31.64
Add : Last years provision written back 1.37 -
Profit after Taxation 3,656.42 3,530.38
Add : Balance of Profit from
earlier years 6,919.81 4,080.92
Amount available for Appropriations 10,576.23 7,611.30
Less: Dividend (Interim & Proposed) 249.15 249.15
Tax on distributed Profits 42.34 42.34
Transfer to General Reserve 450.00 400.00
Balance carried forward 9,834.74 6,919.81
OPERATONS REVIEW
Your Company achieved a total turnover of Rs.46,000.64 Lacs for the
year ended 31st March, 2009 as against 41,232.02 Lacs (restated) in the
previous year. The Company has EBIDTA of Rs.8471.17 Lacs versus
Rs.7765.85 Lacs in the previous year and earned a net profit of
Rs.3,656.42 Lacs versus 3,530.38 Lacs in the previous year. This
represents
a growth of 11.57% in turnover, 9.08% in terms of EBIDTA and 3.57% in
terms of net profit. The overall financial performance is considered
satisfactory considering the global economies faced serious downturn in
the year, with most of the economies registering a negative GDP growth
in percentage terms. The Textile and garment industry was one of the
worst hit sectors of Indian economy, even though the Indian economy
grew at a rate of 6.5% per annum. The impact of slowdown in the U.S.
and Europe hit the industry hard. Despite these trying times, the
Company managed a reasonable growth in terms of turnover and profit.
The Companys ability to mitigate the impact of global recession is
largely attributable to being in the premium segment textile and
garment business, aggressive marketing policies, fully integrated
production facilities resulting in competitive product cost structure
in a continued manner.
DIVIDEND
Your Directors had declared and paid an interim Dividend of 15% for the
financial year ended 31st March, 2009ð in February, 2009 absorbing an
amount of Rs.169.88 Lacs (excluding Dividend Distribution tax of
Rs.28.87 Lacs). Your Directors are pleased to report that the Board has
recommended a final dividend of 7% for the financial year ended 31st
March, 2009. The final dividend will absorb an amount of Rs.79.27 Lacs
(excluding Dividend Distribution tax of Rs. 13.47 Lacs). The total
dividend outflow for the year 31st March, 2009 aggregating Rs.Rs.249.15
Lacs (excluding Dividend Distribution tax of Rs.42.34 Lacs) represents
22% of the Companys paid-up share capital.
AWARDS AND CERIFICATES
Your Company was the proud recipient of The International Trade Award
for being "Outstanding Exporter of the year in Textile and Apparels"
for 2008-09, presented by CNBCTV18.
The award received by your Company reflects achievement in terms of the
growth in sales, especially export sales on a constant basis.
During the year, the Company was awarded certificates in respect of :
1. OE blended resp. OE100 standards for textiles of organic exchange
and "global Organic Textile Standard" or "GOTS" standards for
processing of fibres from certified organic agriculture from Control
Union Certifications.
2. of Oeko-Tex mark, by Oeko-Tex Standard 100 for garments
manufactured and accessories used by the Company meet the
human-ecological requirements of standard presently established for
products with direct skin contact and fulfills the requirements of
existing European legislation regarding use of azo-dyes.
3. compliance of Fairtrade Standards for Seed Cotton by FLO -CERT, for
its Weaving and Dyeing plants at Tarapur and its Garment Plant at
Bangalore.
Your Company has "preferred supplier" status amongst the top niche
domestic and international apparel brands due to its tough insistence
on superior quality and stringent quality assurance criterions in the
designing and manufacturing process of the final products
CORPORATE GOVERNANCE
Your Company, being an unlisted public limited company, does not
attract provisions of Clause 49 of the Listing agreement. However it
has been the endeavour of your Company to progressively implement good
practices in corporate governance in letter and spirit. A corporate
governance report is attached herewith and forms a part of this report.
PUBLIC DEPOSIT
The Company has not accepted any deposit within the meaning of Section
58A of the Companies Act, 1956 and rules made thereunder.
MANAGEMENT DISCUSSION AND ANAYSIS REPORT
A report of the Management Discussion and Analysis is appended to this
report.
DIRECTORS
Mr.Ghyanendra Nath Bajpai and Mr.Ernst Robin Cornelius, Directors of
the Company retire from the Board by rotation in accordance with the
provisions of Companies Act, 1956 and the Articles of Association of
the Company and being eligible, offer themselves for re-appointment.
The particulars of the Directors proposed to be reappointed are given
in the corporate governance report in the Annual Report.
DIRECTORSRESPONSIBILITY STATEMENT:-
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956, with respect to Directors Responsibility Statement, it is
hereby confirmed that;
i) In the preparation of the accounts for the financial year ended 31st
March, 2009, the applicable accounting standards have been followed
along with proper explanation relating to material departures;
ii) The Directors have selected such accounting policies and applied,
them consistently and made judgements and estimates that were
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 of the Company for the year under review;
iii) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provision of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting.fraud and other
irregularities;
iv) The Directors have prepared the accounts for the financial year
ended 31st March, 2009 on agoing concernbasis.
PARTICULARS OF EMPLOYEES
A statement showing the particulars pursuant to Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 as amended vide Companies (Particulars of Employees)
(Amendment) Rules,2002 is annexed to this report and forms integralpart
of this report.
PARTICULARS OF ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE AND OUTGO
Particulars with respect to conservation of energy, technology
absorption and foreign exchange earnings and outgo, as per section
217(1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 and forming part of the Directors Report for the year ended 31st
March, 2009, are annexed to this report.
AUDITORS
M/s. Vishal H.Shah & Associates, Chartered Accountants, the Statutory
Auditors of the Company retire at the conclusion of the ensuing Annual
General Meeting and are eligible for re-appointment. They have
furnished a certificate pursuant to Section 224(1) of the Companies
Act, 1956 regarding their eligibility for re-appointment and your
Directors recommend the re-appointment.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company believes in formulating adequate and effective internal
control systems and implementing the same strictly to ensure that
assets and interest of the Company are safeguarded and reliability of
accounting date and accuracy are ensured with proper checks and
balances. The internal control system is improved and modified
continuously to meet the changes in business conditions, statutory and
accounting requirements.
The Company has engaged a competent firm of Chartered Accountants to
conduct internal audit, examine and evaluate the adequacy and
effectiveness of the Internal Control System at its plants at
Bangalore. The internal audit ensures that the systems designed and
implemented, provides adequate internal control commensurate with the
size and operations of the Company.
The Audit Committee of the Board of Directors, Statutory Auditors and
the Business Heads are periodically apprised of the internal audit
findings and the corrective actions taken.
The Audit Committee of the Board of the Directors actively reviews the
adequacy and effectiveness of internal controls systems and suggests
improvements for strengthening them. The Company has a strong
Management Information System which is an integral part of the control
mechanism. The Company is in the process of implementing an ERP system
across its locations in India
RISK MANAGEMENT
The Company is exposed to risks from fluctuations of foreign exchange,
interest rates and commodity prices.
1. Foreign Exchange Risk
The, Companys policy is to systematically hedge its long term foreign
exchange well as short term exposures risk considering prevalent
conditions.
2. Interest rate risk
Given the interest rate fluctuations, the Company has adopted a prudent
and conservative risk mitigating strategy to minimise the interest
costs.
3. Commodity Price Risk
The Company is exposed to the risk of price fluctuation on row
materials as well as finished goods in all its products. The Company
proactively manages these risks in inputs through, inventory
management, proactive management and vendor development and
relationships. The Companys strong reputation for quality, product
differentiation, service the existence of a strong image and a strong
merchandising network mitigates the impact of price risk on finished
goods.
4. Risk Element in Business
Apart from the risk on account of interest rate, foreign exchange and
regulatory changes, the businesses of the Company are exposed to
certain operating business risk, which are managed by regular
monitoring and corrective actions.
ENVIRONMENT AND SAFETY
The Company is conscious of the importance of environmentally clean and
safe operations. The Companys policy requires the conduct of all
operations in such manner so as to ensure safety of all concerned,
compliance of statutory and industrial requirements for environment
protection and conservation of natural resources to the possible. Ã .
PERSONNEL AND INDUSTRIAL RELATION
Your Company treats Human Resources as an valuable asset for the growth
of the organization and keeping this in view, every effort is being
made to retain and attract best talent in the industry to cater to the
current and future needs of the Company. Various measures are taken by
the management to enhance the capability and performance of the
existing employees. The Directors wish to place on record their
appreciation for the contribution of the workers and officers of the
Company at all levels.
ACKNOWLEDGEMENT
The Directors acknowledge and place on record their appreciation for
the assistance and co-operation extended to the Company by the Central
and State Government, Local Authorities, and Banks.
The Directors would also like to thank our investors, clients, and
customers for their unwavering trust and support. Last but not. the
least, the Board thanks the employees for their contribution and
support in ensuring an all round performance.
For and behalf of the Board of Director.
PURUSHOTTAM C.MANDHANA
(Chairman and Managing Director)
Place Mumbai
Dated : 24th July, 2009