TO THE MEMBERS
Your Directors have pleasure in presenting their 33rd Annual Report together with theAudited Accounts of the Company for the Year ended March 31 2016.
| || ||(Rs. Lacs) |
|Particulars ||March 31 2016 ||March 31 2015 |
|Gross Sales ||125803.83 ||103556.47 |
|Less: State Excise & Vat ||89846.38 ||72822.72 |
|Net Sales ||35957.45 ||30733.75 |
|Other Income ||614.69 ||235.84 |
|Total ||36572.14 ||30969.59 |
|Profit before depreciation Exceptional item & taxation ||8984.06 ||3402.07 |
|Less: Depreciation ||541.32 ||556.16 |
|Add: Exceptional item ||336.46 ||Nil |
|Less: Provision for taxation ||2948.15 ||982.53 |
|Profit after taxation ||5831.05 ||1863.38 |
|Add: Balance brought forward from previous year ||5691.58 ||4823.01 |
|Surplus available for appropriation ||11522.63 ||6686.39 |
|Appropriations || || |
|General Reserves ||300.00 ||300.00 |
|Proposed Dividend ||292.44 ||292.44 |
|Tax on Dividend ||59.54 ||59.87 |
|Additional depreciation on fixed asset ||Nil ||342.50 |
|Balance carried to Balance sheet ||10870.65 ||5691.58 |
|Total ||11522.63 ||6686.39 |
The company proposes to transfer an amount of Rs.300 lakhs to the General Reserves. Anamount of Rs.10870.65 Lakhs is proposed to be retained in the statement of Profit &Loss.
Gross revenues increased to Rs. 125803.83 Lacs a growth of around 21.48 % against Rs.103556.47 Lacs in the previous year. Profit before depreciation exceptional item andtaxation was Rs. 8984.06 lacs against Rs. 3402.07 Lacs in the previous year. Afterproviding for depreciation and taxation of Rs. 541.32 Lacs & Rs. 2948.15 Lacsrespectively and adding exceptional item of Rs.336.46 Lacs the net profit of the Companyfor the year under review was placed at Rs.5831.05 Lacs as against Rs. 1863.38 lacs inthe previous year.
Due to favourable market conditions and on account of better realization ratescompany's turnover in terms of value has increased at an impressive 21 % during the yearunder review. The profit after tax during the year under review had increased by a record212.93 % due to moderate levels of Raw Material/Packing Materials prices throughout theyear and also due to better realisation value for the company's products.
Your Directors have pleasure in recommending for approval of the members at the AnnualGeneral Meeting a dividend of 25 % (at par with the previous year). The Dividend of 25 %if approved at the forth coming Annual General Meeting will result in the out flow of Rs.292.44 lacs to the company in addition to Rs. 59.54 lacs by way of dividend distributiontax.
ISSUE OF BONUS SHARES:
Your Directors have pleasure in recommending for approval of the members at the AnnualGeneral Meeting issue of bonus shares in the ratio of 1 : 4 i.e. one new fully paid equityshare of Rs.10 for every four equity shares of Rs.10 held in the company. The bonus issueif approved at the forth coming Annual General Meeting will result in capitalization ofshare premium account and profit & loss account to the extent of Rs.29244060/-.
The paid up equity capital as on march 31 2016 was Rs.1170.61 Lakhs during the yearunder review.
Cash and cash equivalents as at March 31 2016 was Rs.3405.08 lakhs. The companycontinues to focus on judicious management of its working capital. Receivablesinventories and other working capital parameters were kept under strict check throughcontinuous monitoring.
Your Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The company has not given any loans or guarantees covered under the provisions ofsection 186 of the Companies Act 2013.
The details of the investments made by company are given in the notes to the financialstatements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual. To maintain its objectivity and independence theInternal Audit function reports to the Chairman of the Audit Committee of the Board &to the Chairman & Managing Director.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
As part of its initiatives under "corporate social responsibility" (CSR) thecompany has contributed funds for the schemes of eradicating hunger and poverty promotionof education and medical aid. The contributions in this regard have been made to theregistered trust which is undertaking these schemes. The company has also undertakenschemes of distributing food to the poor directly and other activities as part of the CSRinitiative.
The Annual Report on CSR activities is annexed herewith as: Annexure A
CONSERVATION OF ENERGY:
a) Company ensures that the manufacturing operations are conducted in the mannerwhereby optimum utilisation and maximum possible savings of energy is achieved.
b) No specific investment has been made in reduction in energy consumption. c) As theimpact of measures taken for conservation and optimum utilisation of energy are notquantitative its impact on cost cannot be stated accurately.
d) Since the Company does not fall under the list of industries which should furnishthis information in Form A annexed to the aforesaid Rules the same has not beensubmitted.
Company's products are manufactured by using in-house know how and no outsidetechnology is being used for manufacturing activities. Therefore no technology absorptionis required. The Company constantly strives for maintenance and improvement in quality ofits products and entire Research & Development activities are directed to achieve theaforesaid goal.
FOREIGN EXCHANGE EARNINGS AND OUT-GO :
During the period under review there was no foreign exchange earnings or out flow.
During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.
Directors Smt. Jyoti Jimmy Almeida & Shri. Kiran Yashawant Parashare retire byrotation and being eligible offer themselves for re appointment. The Directors recommendSmt. Jyoti jimmy Almeida & Shri. Kiran Yashawant Parashare for re-appointment.
Shri.Shantilal V.Haria was appointed as an additional independent director of thecompany with effect from October 20 2015 by the Board of Directors and holds office up tothe date of this Annual General Meeting under section 161 of the Companies Act 2013("the act"). The Board now recommends the appointment of Shri. Shantilal V.Hariaas independent director under section 149 of the Companies Act 2013 and under regulation25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 in theensuing A.G.M. to hold office for 4 (Four) consecutive years i.e. for a term up to theconclusion of 37th annual general meeting of the company in the calendar year2020.
Shri. Kiran Parashare was appointed as non executive/ non independent director on theBoard with effect from January 07 2014. The board now recommends the appointment of Shri.Kiran Parshare as wholetime director under section 196197 & 203 read with schedule Vof the Companies Act 2013
All independent directors have given declarations that they meet the criteria ofindependence as laid down under section 149(6) of the Companies Act 2013 and underregulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015
Pursuant to the provisions of the Companies Act 2013 and under regulation 25 of theSEBI (Listing obligations and disclosure requirements) Regulations 2015 the Board hascarried out an evaluation of its own performance the directors individually as well asthe evaluation of the working of its Audit Nomination & Remuneration Committees. Themanner in which the evaluation has been carried out has been explained in the CorporateGovernance Report.
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is stated in the Corporate Governance Report.
A calendar of Meetings is prepared and circulated in advance to the Directors.
During the year five Board Meetings and four Audit Committee Meetings were convened andheld. The details of which are given in the Corporate Governance Report. The interveninggap between the Meetings was within the period prescribed under the Companies Act 2013.
DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:
i) In the preparation of the annual accounts the applicable accounting standards havebeen followed.
ii) The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit or loss of the Company for the year under review.
iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual account on a going concern basis.
v) The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
vi) The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the company at large.
The Company does not have any subsidiary.
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The Company believes in "Zero Tolerance" against briberycorruption and unethical dealings / behaviours of any form and the Board has laid down thedirectives to counter such acts. The code laid down by the Board is known as "code ofbusiness conduct" which forms an Appendix to the Code. The Code has been posted onthe Company's website www.gmbreweries.com.
The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehaviour from an employee in a given situation and the reporting structure.
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code. All Management Staff were given appropriate training in this regard.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Fraud and Risk Management Policy to deal withinstance of fraud and mismanagement if any.
In staying true to our values of Strength Performance and Passion and in line with ourvision of being one of the most respected companies in India the Company is committed tothe high standards of Corporate Governance and stakeholder responsibility.
The Company has a Fraud Risk and Management Policy to deal with instances of fraud andmismanagement if any. The FRM Policy ensures that strict confidentiality is maintainedwhilst dealing with concerns and also that no discrimination will be meted out to anyperson for a genuinely raised concern.
A high level Committee has been constituted which looks into the complaints raised. TheCommittee reports to the Audit Committee and the Board.
PREVENTION OF INSIDER TRADING:
In January 2015 SEBI notified the SEBI (Prohibition of insider trading) Regulations2015 which came into effect from May 15 2015. Pursant thereto the Company has formulatedand adopted a new Code for Prevention of Insider Trading.
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading Window is closed. The Board is responsible forimplementation of the Code.
All Directors and the designated employees have confirmed compliance with the Code.
AUDITOR'S REPORT/ SECRETARIAL AUDIT REPORT:
The observation made in the Auditors' Report read together with relevant notes thereonare self explanatory and hence do not call for any further comments under Section 134 ofthe Companies Act 2013.
As required under section 204 (1) of the Companies Act 2013 the Company has obtained asecretarial audit report. Certain observations have been made in the report with regard tonon compliance in respect of "composition of the Board" during a portion of theyear. The non compliance was due to delay in finding a competent person as independentdirector in the place of Shri. Mukund Diwan who had resigned from the Board all of asudden due to health problems.
The Auditors V. P. Mehta & Co. Chartered Accountants Mumbai retire at theconclusion of the ensuing Annual General Meeting and being eligible offer themselves forre-appointment.
Pursuant to provisions of section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed Kala Agarwal a firm of company Secretaries in practice to undertake theSecretarial Audit of the Company. The Secretarial Audit report is annexed herewith as" Annexure B"
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as " Annexure C".
BUSINESS RISK MANAGEMENT:
Pursuant to section 134 (3) (n) of the Companies Act 2013 & under regulation 21 ofthe SEBI (Listing obligations and disclosure requirements) Regulations 2015 the companyhas constituted a business risk management committee. The details of the committee and itsterms of reference are set out in the corporate governance report forming part of theBoards report.
At present the company has not identified any element of risk which may threaten theexistence of the company.
INFORMATION PURSUANT TO SECTION 197(12) READ WITH RULE 5 OF THE COMPANIES (APPOINTMENTAND REMUNERATION OF MANAGERIAL PERSONEENL) RULES 2014
1. Ratio of remuneration of each director to the median remuneration of the employeesof the company for the year 2015-2016
|Name & Designation ||Remuneration ||Ratio to Median remuneration |
|of the Director ||(Amount Rs. in Lakhs) || |
|Shri. Jimmy Almeida- CMD ||132.00 ||64.11 |
|Smt. Jyoti Almeida- Executive Director ||60.00 ||29.14 |
|Shri. Paresh Trivedi- Independent Director ||00.60 ||Not Applicable as only sitting fees is paid during the year |
|Shri. Dilip Diwan- Independent Director ||01.00 ||Not Applicable as only sitting fees is paid during the year |
|Shri. Kiran Parashare- Non Executive Director ||01.00 ||Not Applicable as only sitting fees is paid during the year |
|Shri. Shantilal Haria- Independent Director ||00.20 ||Not Applicable as only sitting fees is paid during the year |
2. The percentage increase in remuneration of each Director CFO CEO CS or manager ifany in the financial year 2015-16 compared to 2014-15
|Name & Designation of the Director CFO CEO and CS ||Remuneration for the year ended 2015-16 ||Remuneration for the year ended 2014-15 ||% Change |
| ||(Rs.in Lakhs) ||(Rs.in Lakhs) || |
|Shri. Jimmy Almeida- CMD ||132.00 ||84.00 ||57.14 |
|Smt. Jyoti Almeida- Executive Director ||60.00 ||18.00 ||233.33 |
|Shri. Paresh Trivedi- Independent Director ||00.60 ||00.80 ||-25.00 |
|Shri. Dilip Diwan- Independent Director ||01.00 ||01.00 ||Nil |
|Shri. Kiran Parashare- Non Executive Director ||01.00 ||01.00 ||Nil |
|Shri. Shantilal Haria- Independent Director ||00.20 ||00.00 ||N.A. |
|Shri. S. Swaminathan-CFO ||15.25 ||12.65 ||20.55 |
|Shri. Sandeep Kutchhi-CS ||09.00 ||06.00 ||50.00 |
3. The median remuneration of the employees has increased by 10.39 % in 2015-16 ascompared to 2014-15.
4. Number of permanent employees on the rolls of the company
|Financial Year ||Number of permanent employees on the rolls of the company |
|2015-16 ||165 |
|2014-15 ||171 |
5. Explanation on the relationship between average increase in remuneration and thecompany performance
The companys overall turnover increased by 21.48% while the increase in the medianremuneration was 10.39%. However the company is paying fixed remuneration to theindividuals based on the responsibility and position and the company has no policy ofpaying incentive/ bonus based on company's performance.
6. Ratio of the remuneration of the highest paid director to that of the employees whoare not directors but receive remuneration in excess of the highest paid director duringthe year- Not Applicable.
7. Key parameter for any variable component of remuneration availed by the director Not Applicable as no variable remuneration is paid.
8. We affirm that the remuneration paid to the Directors Key Managerial Personnel andemployees is as per the remuneration policy of the Company.
9. Market capitalization & Price Earnings ratio details are as under
|Particulars ||As on March 31 2016 ||As on March 31 2015 |
|Price Earnings Ratio ||18.61 ||7.06 |
|Market Capitalisation (Rs. In Crores) ||1084.66 ||131.48 |
|Net worth of the company (Rs. In Crores) ||180.98 ||126.19 |
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS
The Corporate Governance and Management Discussion & Analysis Report which form anintegral part of this Report are set out as separate Annexures together with theCertificate from the auditors of the Company regarding compliance with the requirements ofCorporate Governance as stipulated under various regulations of the SEBI (Listingobligations and disclosure requirements) Regulations 2015.
Your Company and its Directors wish to extend their sincerest thanks to the Members ofthe Company Bankers State Government Local Bodies Customers Suppliers ExecutivesStaff and workers at all levels for their continuous cooperation and assistance.
| ||For and on behalf of the Board of Directors |
|Mumbai ||Jimmy Almeida |
|April 05 2016 ||Chairman & Managing Director |
Annexure A to Boards Report
ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES
1. A brief outline of the companys CSR policy including overview of projects orprogrammes proposed to be undertaken and a reference to the web-link to the CSR policy andprojects or programmes.
CSR policy is stated herein below:
(Approved by the Board of Directors on 24.07.2014)
Our aim is to be one of the most respected companies in India delivering superior andeverlasting value to all our customers associates shareholders employees and Society atlarge.
The CSR initiatives focus on holistic development of host communities and createsocial environmental and economic value to the society.
To pursue these objectives we will continue to:
1) Work actively in areas of eradication of hunger and poverty provide opportunity andfinancial assistance for the promotion of education provide medical aid to the needy anddown trodden.
2) Collaborate with likeminded bodies like Voluntary organizations charitable trustsgovernments and academic institutes in pursuit of our goals.
3) Interact regularly with stakeholders review and publicly report our CSRinitiatives.
2. Composition of CSR committee
|Name of The Member ||Designation |
|Paresh N. Trivedi ||Chairman |
|Jyoti J. Almeida ||Member |
|Kiran Y. Parashare ||Member |
3. Average net profit of the company for last three financial years: Average netprofit: Rs.18.03 Crores
4. Prescribed CSR Expenditure ( Two percent of the amount as in item 3 above) Thecompany is required to spend Rs.36.06 Lakhs
5. Details of CSR spend for the financial year : a) Total amount spent for thefinancial year : Rs.4860132/-b) Amount unspent if any : Nil c) Manner in which theamount was spent during the financial year is detailed below:
|Sr. No ||Projects/ Activities ||Sector ||Locations ||Amount outlay (Budget) project or programme wise (Rs. Lakhs) ||Amount spent on the project or programme (Rs. Lakhs) ||Cumulative expenditure up to reporting period (Rs. Lakhs) ||Amount spent: Direct or through implementing agency* (Rs. Lakhs) |
|1 ||Educational aid ||Literacy ||Asrondi ( Sindhudurg/ Maharashtra) ||12.50 ||12.50 ||12.50 ||12.50 |
|2 ||Food Distribution ||Eradication of hunger ||Sagar(Madhyapradesh) & Virar (Maharashtra) ||35.00 ||35.34 ||35.34 ||35.34 |
|3 ||Socio Economic Aid ||Social Project ||Dadar Mumbai (Maharashtra) ||0.75 ||0.76 ||0.76 ||0.76 |
* Details of implementing agency : Sant Shree Gulabbaba Charitable Trust &G.M.Breweries Limited.