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DIRECTOR'S REPORT

Renaissance Global Ltd.

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Market Cap. (₹) 508.61 Cr. P/BV 0.76 Book Value (₹) 352.17
52 Week High/Low (₹) 344/199 FV/ML 10/1 P/E(X) 6.08
Bookclosure 07/08/2019 EPS (₹) 44.33 Div Yield (%) 0.00
Year End :2018-03 

Dear Members,

The Directors take great pleasure in presenting the 29th report on the business and operations of your Company along with the Annual Report and Audited Financial Statements for the Financial Year 2017-18.

Financial Highlights

Your Company earned a Profit Before Tax (PBT) of Rs.382.26 million, as compared to PBT of Rs.384.06 million in the previous year. Highlights of the financial performance (Standalone) are as follows:

(Rs. in Million)

F.Y. 2017-18

F.Y. 2016-17*

Sales

10222.08

11004.32

Gross Profit

876.40

819.70

PBID

604.91

546.53

Less: Interest

91.74

81.08

Less: Depreciation

78.08

81.39

PBT

382.26

384.06

Provision for Tax

83.04

86.30

PAT

299.21

297.76

*The Company has adopted Indian Accounting Standards (Ind AS) with effect from April 01, 2017, pursuant to the notification of Companies (Indian Accounting Standard) Rules, 2015 issued by the Ministry of Corporate Affairs under Section 133 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014. The financial statements for the year ended on March 31, 2017 have been restated in accordance with Ind AS for comparative information.

The consolidated revenue from operations of the Company for the year ended March 31, 2018 was Rs.18251.02 million (PY. Rs.14734.48 million), an increase of 23.87% on a year-on-year basis. An Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) was Rs.1016.11 million (PY Rs.812.59 million) an increase of 25.05% on a year-on-year basis. Profit After Tax (PAT) was Rs.637.91 million (PY Rs.425.22 million) an increase of 50.02% on a year-on-year basis. The detailed analysis of the Company’s business is given in the Management’s Discussion and Analysis Report that forms part of this Annual Report.

Dividend

Your Board of Directors has not recommended any dividend for the Financial year ended March 31, 2018.

Transfer to Reserves

During the year under review, your Company has not transferred any amount to General Reserve Account.

Material Changes & Commitments

No material changes and commitments, affecting the financial position of the Company have occurred after the end of the financial year 2017-18 and till the date of this report.

Management’s Discussion and Analysis Report

Management’s Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 (2) (e) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI (LODR) Regulations, 2015), is presented in a separate section forming part of this Annual Report.

Subsidiaries

As on signing date of this report, your Company had following direct and indirect subsidiary companies/LLP:

Direct Subsidiary Companies:

1. Renaissance Jewelry New York Inc., USA

2. Verigold Jewellery (UK) Ltd., London

3. N. Kumar Diamond Exports Ltd, India #

4. Renaissance Jewellery Bangladesh Pvt. Ltd., Bangladesh

5. Verigold Jewellery DMCC, Dubai

Indirect (Step-down) Subsidiary Companies:

1. House Full International Ltd., India #

(Subsidiary of N. Kumar Diamond Exports Ltd)

2. House Full Supply Chain Management Ltd., India

(Subsidiary of House Full International Ltd.)

3. Renaissance Jewellery DMCC

(Subsidiary of Verigold Jewellery DMCC, Dubai)

Limited Liability Partnership:

1. Aurelle Jewellery LLP India $

# Amalgamation of wholly owned subsidiaries (WOS) of the Company

During the financial year under review, the Board of Directors of the Company at its meeting held on August 29, 2017 has approved the Scheme of Amalgamation of wholly owned subsidiaries of the Company viz. House Full International Limited and N. Kumar Diamond Exports Limited with the Company.

As per the order dated January 19, 2018 passed by the Hon’ble National Company Law Tribunal (NCLT) Mumbai Bench, the meeting of equity shareholders of the Company was convened and held on February 27, 2018 to approve the said Scheme of Amalgamation. At the said meeting the shareholders of the Company have approved the Scheme of Amalgamation. On March 21, 2018, the Company has filed the necessary proceeding documents with the NCLT as per the provisions of Companies Act, 2013. However, the final approval of the NCLT for the said Scheme of Amalgamation is awaited.

The appointed date for the said amalgamation is April 1, 2017 or such other date as may be agreed between the Transferor Companies and the Company and approved by the NCLT.

Pursuant to Scheme of Amalgamation, no consideration shall be paid and no shares of the Company shall be issued and allotted on amalgamation. The Scheme of Amalgamation will enable the Company to consolidate and effectively manage the Transferor Companies and the Company in a single entity, which will provide several benefits including synergy, economies of scale, attain efficiencies and cost competitiveness.

The details of Scheme of Amalgamation of House Full International Limited and N. Kumar Diamond Exports Limited with Renaissance Jewellery Limited and Notice of NCLT Convened Meeting are posted on website of the Company www.reniewellery.com.

$ Strike off of Aurelle Jewellery LLP

After the closure of the financial year under review Aurelle Jewellery LLP has filed an Application for striking off its name with the Registrar, on May 10, 2018.

Financial statements/reports of the subsidiaries

The Company has eight subsidiaries including five wholly owned subsidiary and three step-down subsidiaries. The Board of Directors of the Company reviewed the affairs of subsidiaries of the Company. The Consolidated Financial Statements of the Company are prepared in accordance with the relevant Indian Accounting Standards issued by the Institute of Chartered Accountants of India and forms an integral part of this Report.

Further, a statement containing the salient features of the financial statement of the subsidiaries in the format prescribed i.e. Form AOC-1, (Pursuant to first Proviso to sub-section (3) of section 129 read with Rule 5 of Companies (Accounts) Rules, 2014) has been attached separately to this Annual Report. The Company will make available the accounts of subsidiaries to any member of the Company on request.

Consolidated Accounts

In accordance with the requirements of Companies Act, 2013 and Indian Accounting Standards IND-AS 110 prescribed by the Institute of Chartered Accountants of India, the Consolidated Financial Statements of the Company and its subsidiary is provided in this Annual Report.

Goods and Services Tax (GST)

The Goods and Services Tax (GST) is a landmark reform having a lasting impact on the economy and on businesses. Your Company has successfully implemented and migrated to GST with effect from July 01, 2017 and changes across IT systems, supply chain and operations have been made keeping in mind the sweeping changes that GST has brought in.

Share Capital

- Issue of equity shares with differential rights

During the financial year under review, there was no issue of equity shares with differential rights in terms of Rule 4 (4) of Companies (Share Capital and Debentures) Rules, 2014.

- Issue of sweat equity shares

During the financial year under review, there was no issue of sweat equity shares as provided in rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014.

- Buyback of Equity Shares

During the financial year under review, after obtaining requisite approval of the Board, your Company has completed the buyback of 2,00,000 equity shares of the Company (representing up to about 1.05% ofthe total number of Equity shares of the Company) at a price of Rs.250 per share for an aggregate amount of Rs.5,00,00,000/-.

The Buy Back offer size of Rs.5,00,00,000 represents 1.20% of the total Paid up Capital and Free Reserves of the Company, as per the audited accounts of the Company for the financial year ended March 31, 2017.

In accordance with the provisions of the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998 and the Companies Act, 2013 and rules made there under, the said buyback was made from the Equity Shareholders/ Beneficial owners ofthe Company who held Equity Shares as on the record date i.e. June 12, 2017 (“Record Date”) on a proportionate basis through the tender offer using stock exchange mechanism (“Tender offer”).

An amount of Rs.5,00,00,000 was utilised from General Reserve to off-set the buy back offer including transfer of Rs.20,00,000 to the Capital Redemption Reserve to the extent of Share Capital extinguished.

The final settlement date for buy back was September 13, 2017 and Extinguishment of Shares was completed by September 20, 2017.

Consequent to such buy back the number of Equity Shares reduced from 1,90,79,440 to 1,88,79,440 post buy back and accordingly Issued, Subscribed and Paid-up Capital reduced to Rs.18,87,94,400/-.

Documents relating to buyback are available on Company’s website www.renjewellery.com.

Apart from the above, there were no changes in the Share Capital during the Financial Year under review.

Issue of shares under the Employees’ Stock Purchase Scheme (ESPS)

Compensation Committee of the Board of Directors of the Company, inter alia, administers the Employees’ Stock Purchase Scheme of the Company in accordance with the applicable guidelines of Securities and Exchange Board of India.

The Company had opted for trust route for offering ESPS and 720000 shares were issued to the RJL Employee Welfare Trust (ESPS Trust) in F.Y 2008-09 for onward offering to the recommended employees. Hence, Basic and Diluted Earning Per Share (EPS) is Rs.16.19.

Your Company, through ESPS Trust, had offered the ESPS shares to the recommended employees under the Tranch - I and Tranch - II of RJL Employees’ Stock Purchase Scheme - 2008 (RJL ESPS - 2008).

During the financial year under review, with the approval of shareholders obtained through a Postal Ballot process, the Company introduced and implemented the RJL - Employees Stock Purchase Scheme 2017 (“RJL ESPS-2017”) for issue and/ or offer and/or transfer of not exceeding 15,00,000 fully paid-up Equity Shares of face value of Rs.10 each, to eligible employees of the Company as well as that of its subsidiaries.

The said RJL ESPS-2017 was introduced to replace the existing RJL - ESPS-2008.

The new Scheme “RJL ESPS-2017” was approved by the Board of Directors through Circular Resolution passed on October 13, 2017 and by the members through Postal Ballot Resolutions passed on November 20, 2017.

Under the Tranch -1 of RJL ESPS - 2017, the Company has offered 4,50,000 ESPS shares to the recommended employees.

The RJL ESPS - 2017 is implemented by Compensation Committee in accordance with the requirements of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, (SEBI SBEB Regulation) and other applicable laws.

During the financial year under review, the Company has issued 3,00,000 ESPS shares to Mr. Parag Shah which is exceeding 1% of the issued capital of the Company.

RJL ESPS-2008 and RJL ESPS -2017 of the Company are in compliance with the SEBI SBEB Regulations.

As required under Regulation 13 of the said Regulations, the Company has obtained a Certificate from M/s. Damania & Varaiya, Chartered Accountants, the Statutory Auditors of the Company, certifying that the Schemes are implemented in accordance with these regulations and the resolutions of the Company. The same would be placed before the members at the ensuing AGM and a copy of the same shall be available for inspection at the Registered Office of the Company.

As stipulated under SEBI SBEB Regulations, read with the circular issued by SEBI on June 16, 2015 and Rule 12 (9) of Companies (Share Capital and Debentures) Rules, 2014, the applicable disclousres as on March 31, 2018, are given below:

#Tranch I and II of RJL ESPS - 2008 have lapsed on February 28, 2014 and July 31, 2015 respectively.

Implementation of RJL - Employees Stock Option Plan 2018 (RJL ESOP 2018)

The Board of Directors of the Company at their Meeting held on May 28, 2018, has approved the “RJL - Employees Stock Option Plan 2018” (RJL ESOP 2018), subject to shareholders’ approval which will be implemented by Compensation Committee constituted under Section 178 of the Companies Act, 2013, in accordance with the requirements of Securities and Exchange Board Of India (Share Based Employee Benefits) Regulations, 2014 (“SEBI SBEB Regulations”) and other applicable laws.

The Board is proposing the said RJL ESOP 2018 for the approval of the members at the ensuing Annual General Meeting, pursuant to the provisions of section 42 and 62 (1) (b) and all other applicable provisions, if any, of the Companies Act, 2013 and as per the requirement of Clause 6 of the SEBI SBEB Regulations.

The details of the RJL ESOP 2018 are provided in the AGM Notice forming part of this Annual Report.

Listing

At present 18,879,440 Equity Shares of the Company are listed on the Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

The Company has paid the applicable listing fees to these Stock Exchanges for the financial year 2018-19. The Company’s shares are compulsorily tradable in electronic form and the Company has established connectivity with both the depositories, i.e. Central Depository Services (India) Ltd. (CDSL) & National Securities Depository Ltd. (NSDL).

Your Company has fully complied with the Securities and Exchange Board of India Circular—Cir/ISD/3/2011, dated June 17, 2011 by achieving 100% of promoter’s and promoter group’s shareholding in dematerialized form. Therefore, the securities of Company are traded in the normal segment of the Exchanges.

Awards/Recognition

Your Company has always strived for the best quality and designs adhering necessary Ethical Standards. The Company has been consistently receiving recognition by various Trade Organizations and Councils, for its’ performance and achievements. Following are some of the awards/recognition received by the Company in the past:

- GJEPC Award for outstanding Export Performance under the category “Studded Precious Metal Jewellery Exports”, in 2017

- GJEPC Award for topping Export Performance under the category “Studded Precious Metal Jewellery Exports”, in 2016

- Accorded with membership of Responsible Jewellery Council (RJC), in 2016

- GJEPC Award for outstanding Export Performance under the category “Studded Precious Metal Jewellery Exports”, in 2015

- GJEPC Award for outstanding Export Performance under the category “Studded Precious Metal Jewellery Exports”, in 2012

- GJEPC Award for topping the export performance under the category “Studded Precious Metal Jewellery Exports from EPZ/ EOU Complexes” in 2011

- Emerging India Awards 2009

- GJEPC Award for being the largest exporter of Studded Precious Metal Jewellery in 2008

- Wal-Mart’s ‘International Supplier of the Year’ Award, in 2004

- SEEPZ-SEZ Star 2000-2001 Award

Corporate Governance

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by Securities and Exchange Board of India. The Company has taken appropriate steps and measures to comply with all the applicable provisions of Regulation 17 to 27 of SEBI (LODR) Regulations, 2015 and Section 177 of the Companies Act, 2013.

A separate report on Corporate Governance, as stipulated under Regulation 34(3) read with Schedule V of SEBI (LODR) Regulations, 2015, along with a certificate of Practicing Company Secretary of the Company, forms an integral part of this Annual Report. A certificate from the Managing Director and CFO of the Company confirming internal controls and checks pertaining to financial statements for the year ended March 31, 2018 was placed before the Board of Directors and the Board has noted the same.

Cash Flow Statement

In conformity with the provisions of Regulation 34 (2) (c) of the SEBI (LODR) Regulations, 2015, the cash flow statement for the year ended March 31, 2018 is annexed hereto.

Directors & Key Managerial Personnel

As per the provisions of Section 149 of the Companies Act, 2013 and Regulation 17 of SEBI (LODR) Regulations, 2015, the Company is compliant of the requirement of having at least 50% of the total number of Directors as Independent Directors and one lady director on the Board of the Company.

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Neville R. Tata (DIN: 00036648), Executive Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible has offered himself for reappointment.

Brief resume of the Director proposed to be appointed/ re-appointed, nature of their expertise in specific functional areas and names of companies in which they hold Directorships and Membership/ Chairmanship of Board Committees, as stipulated under Regulation 17 of SEBI (LODR) Regulations, 2015 are provided in the Notice forming part of this Annual Report.

Key Managerial Personnel (KMP):

Pursuant to the provisions of Section 203 of the Companies Act, 2013 and Rule 8 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the following are whole-time Key Managerial Personnel of the Company as on March 31, 2018:

1. Mr. Hitesh Shah - Managing Director

2. Mr. G. M. Walavalkar - Company Secretary

3. Mr. Dilip Joshi - Chief Financial Officer

During the year under review, there is no change in the Board of Directors of the Company.

Declaration by Independent Director

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(b) of SEBI (LODR) Regulations, 2015.

Nomination and Remuneration Policy

The policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated by the Nomination and Remuneration Committee and approved by the Board of Directors, in compliance with Section 178 of the Companies Act, 2013 read along with the applicable rules thereto and Regulation 19 of SEBI (LODR) Regulations, 2015.

This policy lays down the criteria for determining qualifications, positive attributes and independence of directors and evaluation of Independent Director and the Board. This policy also includes the Policy on Board diversity. The said Nomination and Remuneration policy is posted on the website of the Company www.reniewellery.com.

Annual Evaluation of Board, Committees and Directors

Pursuant to the provision of Section 134(3) (p) read with Rule 8(4) of Companies (Accounts) Rules, 2014 and part D of Schedule II of SEBI (LODR) Regulations, 2015 the Nomination and Remuneration Committee has devised a criteria for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The Independent Directors and Non-Independent Directors at their respective meetings evaluated performance of fellow directors based on factors like leadership quality, attitude, initiatives and responsibility undertaken, decision making, commitment and achievements during the financial year under review.

Meeting of Independent Directors

In accordance with the Clause VII of Schedule IV of the Companies Act 2013 and Regulation 25(3) of SEBI (LODR) Regulations, 2015, a separate meeting of Independent Directors was held on May 08, 2018 without the attendance of Non-Independent directors and members of the management.

At this meeting the Independent Directors reviewed the performance of Non-Independent Directors including Executive Chairman and Managing Director and the Board as a whole.

Familiarisation Program for Independent Directors

The Company has formulated Familiarisation Program to familiarise the Independent Directors with the Company and its business. The details of the program and related matters are posted on the website of the Company www.renjewellery.com.

Disclosure of Pecuniary Relationship

There was no pecuniary relationship or transactions of the Non-Executive Directors vis-a-vis the Company during the year under review. Also, no payment, except sitting fees, was made to any of the Non-Executive Directors of the Company. No convertible instruments are held by any of the Non-Executive Directors.

Directors’ Responsibility Statement

As required under provisions of Section 134 (3)(C) of the Companies Act, 2013 the Directors hereby state that:

a) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Companies Act, 2013, have been followed and there are no material departures from the same;

b) selected accounting policies were applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities to the best of the Directors’ knowledge and ability;

d) the annual accounts have been prepared on a ‘going concern’ basis;

e) internal financial controls to be followed by the Company have been laid down and that such internal financial controls are adequate and are operating effectively and

f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Auditors

M/s Damania & Varaiya., Chartered Accountants, the statutory auditors of the Company have expressed their inability to continue as auditors of the Company and tendered their resignation.

In order to fill the casual vacancy due to resignation of M/s Damania & Varaiya, the Board, at its meeting held on May 28, 2018, on recommendation of Audit Committee, have decided to recommend to the shareholders, the appointment of M/s Chaturvedi and Shah, Chartered Accountants (Firm Registration No:101720W) as new statutory auditors of Company to hold office from the conclusion of 29th Annual General Meeting till the conclusion of 34th Annual General Meeting.

The requirement to place the matter relating to ratification of appointment of Auditors by members at every Annual General Meeting is done away with by the Ministry of Corporate Affairs vide its notification dated May 7, 2018. Hence, there will be no ratification at AGM of appointment of Auditors, who will be appointed in the ensuing Annual General Meeting.

M/s Chaturvedi and Shah have given their consent to act as Statutory Auditors of the Company and have also confirmed that their appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013.

Auditors’ Report

The Notes on financial statement referred to in the Auditors’ Report are self-explanatory and do not call for any further comments by the Board. There is no qualification / reservation / adverse remark / disclaimer made in the Auditors’ Report for the financial year 2017-18.

Internal Auditors

In accordance with provisions of Sections 138 of the Companies Act, 2013 and pursuant to the recommendation of the Audit Committee, M/s. Jayesh Dadia & Associates, Chartered Accountants, Mumbai have been appointed as Internal Auditors of the Company for conducting Internal Audit of the Company for the Financial Year 2017-18.

The Internal Auditors independently evaluate the internal controls, adherence to and compliance with the procedures, guidelines and statutory requirements. The Audit Committee of Board periodically reviews the reports of the internal auditors and corrective actions taken by the Management with regard thereto.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

Secretarial Auditor

In accordance with provisions of Sections 204 of the Companies Act, 2013, the Board has appointed M/s V. V. Chakradeo & Co., Practicing Company Secretaries, Mumbai, as Secretarial Auditors of the Company to conduct Secretarial Audit for the financial year 2017-18. The Secretarial Audit Report for the financial year ended March 31, 2018 is enclosed herewith as Annexure - I forming part of this Director’s Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Deposits

There was no deposit accepted by the Company within the meaning of Section 58A of the Companies Act, 1956 and Rules made there under. During the financial year under review, the Company has neither invited nor accepted any deposit under Section 73 of the Companies Act, 2013 and the rules made there under and therefore, no amount of principal or interest was outstanding as of the date of the Balance Sheet.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Following is the information required under Section 134 (3) (m) ofthe Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 for the year ended March 31, 2018

a) Conservation of Energy:

The Company continued energy conservation efforts during the year. It has closely monitored power consumption and running hours on day to day basis, thus resulting in optimum utilization of energy. The office and production areas are fitted with energy saving devices to conserve energy in the long run.

Contracts and Arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an 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.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is posed on the Company’s website www.renjewellery.com.

Your Directors draw attention of the members to the related party disclosures sets out in the financial statements of the Company.

Corporate Social Responsibility (CSR)

The Company has established the Corporate Social Responsibility Committee (CSR Committee) which has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board. The said CSR Policy is posed on the Company’s website www.renjewellery.com.

The Company has identified four focus areas of engagement which are as under:

Medical, Health Care and Social Welfare: Affordable solutions for healthcare and social welfare through improved access, health awareness.

Educational: Access to quality education, training and skill enhancement.

Humanitarian: Creating sustainable livelihood, addressing poverty, hunger and malnutrition.

Environmental, Animal Welfare, Cultural and Religious: Ensuring environmental sustainability, ecological balance, animal welfare, conservation of natural resources and protection of national heritage, art, culture and religion.

As required under Section 135 of the Companies Act, 2013 and Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Annual Report on CSR activities is enclosed herewith as Annexure - II forming part of this Director’s Report.

Risk Management

The Board of Directors has adopted Risk Management Policy for the Company which provides for identification, assessment and control of risks which in the opinion of the Board may threaten the existence of the Company.

The Management, through a properly defined framework in terms of the aforesaid policy, identifies, monitors, controls and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.

The Audit Committee and the Board periodically discuss the significant business risks identified by the Management and review the measures taken for their mitigation.

Human Resources

Employees are the key assets of the Company and the Company has created a healthy and productive work environment which encourages excellence. Your Company has put in place a scalable requirement and human resource management process, which enables it to attract and retain employees of the high caliber. The Company continuously invests in training staff in the latest technology.

Implementation of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has constituted a Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Committee meets regularly and takes up programs to spread awareness and educate employees about prevention of Sexual Harassment at Workplace.

No instances of Sexual Harassment of Women under the said Act have been reported in any of the units of the Company during the financial year under review.

Other Disclosures

CSR Committee

The CSR Committee comprises of Mr. Niranjan A. Shah as Chairman, Mr. Hitesh M. Shah and Mr. Anil K. Chopra, as other members.

Audit Committee

The Audit Committee comprises of Independent Directors namely Mr. Veerkumar C. Shah as Chairman, Mr. Arun P Sathe and Mr. Vishwas V. Mehendale, as other members.

All the recommendations made by the Audit Committee were accepted by the Board.

Meetings of the Board

Six meetings of the Board of Directors were held during the financial year under review. For further details, please refer report on Corporate Governance enclosed in this Annual Report.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient, as required under Section 186 of the Companies Act, 2013 are provided in the standalone financial statement (Please refer to Note 54 to the standalone financial statement).

Particulars of Employees

The disclosure pursuant to Section 197(12) read with rule 5(1) and 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed herewith as Annexure - III forming part of this Director’s Report.

Compliance with Secretarial Standards on Board and General Meetings

During the Financial Year, your Company has complied with applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).

Extract of Annual Return

An extract of Annual Return in Form MGT-9 as provided under sub-section (3) of Section 92 of the Companies Act, 2013 read with and rule 12(1) of the Companies (Management and Administration) Rules, 2014 is enclosed herewith as Annexure - IV forming part of this Director’s Report.

Transfer of Unclaimed Dividend to Investor Education and Protection Fund (IEPF)

In terms of Section 125 of the Companies Act, 2013, any unclaimed or unpaid Dividend relating to the financial year 2010-11 is due for remittance to the Investor Education and Protection Fund (IEPF) established by the Central Government, on October 07, 2018. For the unclaimed dividend relating to other financial years and the respective IEPF Transfer due dates, please refer the statement of IEPF transfer provided in Report on Corporate Governance.

During the financial year under review, the Company has transferred unclaimed dividend for FY 2009-10 amounting to Rs.80,374/-, to the IEPF.

Details of Significant and Material orders passed by the Regulators or Courts

During the financial year under review, no order had been passed by the regulators/ courts or tribunals which have an effect on the going concern status of the company and its operations.

Cautionary Statement

Statements in this Directors Report and Management Discussion & Analysis describing the Company’s objectives, projections, estimates, expectations or predictions may be “forward-looking statements” within the meaning of applicable Securities laws and regulations. Actual results could differ materially from those expressed or implied due to risk of uncertainties associated with our expectations with respect to, but not limited to, changes in Government regulations, tax regimes, economic developments within India and the countries in which the Company conducts business, technological changes, exposure to market risks, general economic and political conditions in India and which have an impact on our business activities or investments, the monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, the performance of the financial markets in India and globally and raw material availability and prices, demand & pricing in the Company’s principal markets, and other incidental factors.

Acknowledgements

Your Directors take this opportunity to thank the Company’s customers, members, vendors and Bankers for their continued support during the year. Your Directors also wish to thank the Government of India and its various agencies, the Santacruz Electronics Export Processing Zone, the Customs and Excise/GST department, the Reserve Bank of India, the State Governments of Maharashtra, and other local Government Bodies for their support and look forward to their continued support in the future.

Your Directors also place on record their appreciation for the excellent contribution made by all Employees of the Company through their commitment, competence, co-operation and diligence to duty in achieving consistent growth for the Company.

For and on behalf of the Board,

Niranjan Shah Hitesh Shah

Executive Chairman Managing Director

(DIN - 00036439) (DIN - 00036338)

Mumbai, May 28, 2018

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