The Directors have the pleasure of presenting the 38th Annual Report of your Companyfor the financial year 2018-19.
the financial performance of your Company for the year ended March 31 2019 issummarized below:-
| || |
(Rs in Lakhs)
|Particulars ||Current Year ||Previous Year |
|revenue and other income ||75285.12 ||67233.63 |
|profit before interest depreciation and tax ||17858.73 ||15209.71 |
|Interest and financial charges ||2077.50 ||2372.59 |
|Depreciation ||4773.16 ||4504.07 |
|profit from operations (before tax) Prior Year adjustment & exceptional item ||11008.07 ||8333.05 |
|tax Expenses || || |
|current tax ||1813.95 ||639.26 |
|Deferred tax ||416.99 ||826.76 |
|profit/^oss) after tax ||8777.03 ||6867.03 |
|less: proposed appropriation || || |
|Dividend on equity Shares ||250.00 ||250.00 |
Industry Review Corporate Overview
Satia industries Limited operates in the following business segments:-
1 Writing and Printing Paper
5 Co-generation of power for captive consumption and
6 Solar Power.
The Highlight of the Company's performance for the year ended March 31 2019 are asbelow:-
1 Production of paper as compared to 113517 MT of last year of the company increased by8.35% to 123000
2 Net revenue of your company increased by 15 % to Rs 73840.55 lakh as compared to Rs64207.32 lakh during the previous year 2017-18
3 profit Before Depreciation and tax increased by 22.93 % to Rs 15781.23 Lakh ascompared to Rs 12837.12 lakh during the previous year 2017-18
4 profit before tax increased by 32.10% to Rs 11008.07 lakh as compared to Rs 8333.05lakh during the corresponding period of previous year 2017-18
5 Net profit Increased by 29.54 % to Rs 8797.64 lakh as Compared to Rs 6791.40 lakh inthe previous Year.
During the year under review the Board declared Interim Dividends-Rs 1.00 (10%) perequity share of Rs 10/- each in its meeting held on 13.02.2019. Your Directors are pleasedto recommend a Final Dividend of Rs1.50 (15%) per equity share of Rs 10/- each forFinancial Year 2018-19 for the approval of the equity shareholders at the ensuing AnnualGeneral Meeting. if approved the total dividend payout (interim and final dividend) forthe financial year 2018-19 will be Rs 2.50 (25%) per equity share of Rs 10/- each.
The paid up equity capital as on March 31 2019 was Rs. 100000000/-. During the yearunder review the company has not issued any shares.
The closing balance of the retained earnings of the Company for the financial year2019 after all appropriation and adjustments was Rs 29757.38 lakhs
The company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of thebalance sheet.
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 aregiven in the notes to the financial statements.
Internal Control Systems and their adequacy
The company has an internal control System commensurate with the size scale andcomplexity of its operations. to maintain its objectivity and independence the internalauditor reports to the Joint Managing Director and the quarterly reports are placed beforethe Audit committee.
Based on the report of internal audit the audit committee recommends correctiveactions the respective department needs to undertake in their respective areas and therebystrengthen the controls.
As on 31st March 2019 the company have 11 Directors consisting of 4 Executive Non-Independent Directors 7 non- executive Independent Directors Sh. Hardev Singh Director(technical) is proposed to retire by rotation at the ensuing Annual General Meeting (AGM)and being eligible offers himself for reappointment. the term of two independent Directorsviz. Shri A. c. Ahuja and Shri Dinesh chand Sharma is expiring at the ensuing AGM in Sept2019. Based on the recommendation of the Nomination and Remuneration Committee theirre-appointment for a second term of five years is proposed at the ensuing AGM for theapproval of the Members by way of special resolution.
ah the Independent Directors have affirmed their Independence under Section 149 of theCompanies Act 2013 and provisions of regulation 25 of SEBi (lodr) regulations 2015. thecompany has obtained requisite declaration to that effect from the said Directors.
The Board of Directors has carried out an annual evaluation of its own performanceboard committees and individual directors pursuant to the provisions of the Act and SEBiListing Regulations. the performance of the board was evaluated by the board after seekinginputs from all the directors on the basis of criteria such as the board composition andstructure effectiveness of board processes information and functioning etc. theperformance of the committees was evaluated by the board after seeking inputs from thecommittee members on the basis of criteria such as the composition of committeeseffectiveness of committee meetings etc. the above criteria are based on the GuidanceNote on Board evaluation issued by the Securities and exchange Board of India on January5 2017 in a separate meeting of independent directors performance of non-independentdirectors the board as a whole and the chairman of the company was evaluated taking intoaccount the views of executive directors and nonexecutive directors.
the Board and the Nomination and Remuneration committee reviewed the performance ofindividual directors on the basis of criteria such as the contribution of the individualdirector to the board and committee meetings like preparedness on the issues to bediscussed meaningful and constructive contribution and inputs in meetings etc. in theboard meeting that followed the meeting of the independent directors and meeting ofNomination and Remuneration committee the performance of the board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.
Key Managerial Personnel
Pursuant to the provisions of Section 149 of the Act the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Act along with Rules framed thereunder and Regulation 16(1)(b) ofthe Securities and exchange Board of India (Listing obligations and DisclosureRequirements) Regulations 2015 ("SEBi Listing Regulations"). There has been nochange in the circumstances affecting their status as independent directors of thecompany.
During the year under review the non-executive directors ofthe company had nopecuniary relationship or transactions with the company other than sitting feescommission and reimbursement of expenses incurred by them for the purpose of attendingmeetings of the Board/Committee ofthe Company.
Pursuant to the provisions of Section 203 of the Act the Key Managerial Personnel ofthe company as on March 31 2019 are:
Dr Ajay Satia: Chief Executive Officer (CMD & CEO)
Sh ashok Kumar Khurana: CFo
Sh Rakesh Kumar Dhuria: Company Secretary
The Board has on the recommendation of the Nomination & Remuneration committeeframed a policy for selection & appointment of Directors. Senior Management and theirremuneration. the remuneration policy is stated in the annexure-I.
During the year four board meeting and five audit committee Meetings were convened andheld. the detail 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 Responsibility Statement
Pursuant to requirement of Section 134 (5) of the Companies act 2013 your Directorsconfirm that :
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are 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 period.
(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities.
(d) the Directors had prepared the annual accounts on a going concern basis.
The Directors had laid down internal financial control to be followed by the companyand that such internal financial controls are adequate and were operating effectively. theDirectors had devised proper systems
To ensure compliance with the provision of all applicable laws and that such systemwere adequate and operating effectively.
Audit Reports and Auditors
The auditors report for the year 31.03.2019 does not contain any qualificationreservation or adverse remark. the auditors' report is enclosed with the financialstatement in this annual report.
Under section 139 of the Companies act 2013 and the rules made there under it ismandatory to rotate the statuary auditors on completion of the maximum term permittedunder the said section in line with the requirements of the companies Act 2013 M/SDeepak Grover & association Charted accountants (firm registration no 505923) wasappointed as the Statutory auditors of the company to hold office for a period of fiveconsecutive years from the conclusion of the 36th Annual General Meeting of the companyheld on 29th September 2017 till the conclusion of the 41st Annual General Meeting to beheld in the year 2022 subject to ratification by shareholders at the annual GeneralMeeting or as may necessitated by the Act from time to time. the first year of audit wasof the financial statements for the year ending March 31 2017 which included the audit ofthe quarterly financial statements for the year. Accordingly the appointment of M/sDeepak Grover & associates is being placed before the shareholders for ratification.
The auditors' report on the accounts is self explanatory and requires no comments.
Pursuant to provision of section 204 of the companies Act 2013 and the companies(Appointment and remuneration of Managerial Personnel) rules 2014 the company hasappointed M/s S. parnami & associates a firm of company Secretaries in practice toundertake the Secretarial Audit of the company. the Secretarial audit report is annexedherewith as '^nnexure V. the secretarial audit report for the year under review requiresno comments. the said report does not contain any qualification reservation or adverseremarks.
During the year under review M/s G. Baksh & associates Internal Auditors carriedout the internal audit and submitted their report.
Pursuant to the provisions of the Companies Act 2013 M/s R J Goel & Co. CostAccountants New Delhi has conducted the cost audit of the company.
Indian Accounting Standard
Your company has adopted indian Accounting Standards (iND AS). The Financial Statementfor the year ended March 31 2019 have been prepared in accordance with Ind As notifiedunder the Companies (indian Accounting Standards) Rules as amended by the companies(indian Accounting Standard) Rules2018 read with Section 133 and other applicableprovisions of the companies Act 2013.
Related Party Transaction:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. there are no materiallysignificant related party transactions made by the company with Promoters Key ManagerialPersonnel or other designated persons which may have potential conflict with interest ofthe company at large. transactions with related parties entered by the company in thenormal course of business are periodically placed before the Audit committee for itsomnibus approval. the Board of Directors of the company has on the recommendation of theAudit committee adopted a policy to regulate transactions between the company and itsrelated Parties in compliance with the applicable provisions of the companies Act 2013the rules there under and Listing regulations. this Policy as considered and approved bythe Board has been uploaded on the webs site of the company at www.satiagroup.com
the company does not have any subsidiary. Whistleblower Policy
the company has in place a Whistleblower Policy to deal with unethical behaviorvictimization fraud and other grievances or concerns if any. the aforementionedwhistleblower policy is available on the Company's website at the following web-link:www.satiagroup.com
Extract of Annual Return:
the details forming part of the extract of the annual return in form MGT-9 is annexedherewith as "Annexure -VI
Business Risk Management
Pursuant to Section 134 (3) (n) of the companies Act 2013 the Board of Directors ofthe company has formed a risk management committee to frame implement and monitor therisk management plan for the company.
Particulars of Employees
Information as required under Section 197 read with rule 5 of the companies Appointmentand remuneration of Managerial Personnel) rules 2014 is appended as Annexure-II and formsan integrated part of this report.
Conservation of Energy Technology Absorption and Foreign Exchange Earning and Outgo
The Particulars as prescribed under section 134(3) (m) of the companies Act 2013 readwith rule 8 of the company (Accounts) rules 2014 relating to conservation of energytechnology absorption and foreign exchange earnings and outgo is appended as anAnnexure-III to the Director's Report.
During the year under review your company enjoyed cordial relationship with workersand employees at all levels.
Corporate Social Responsibility Initiatives
The brief outline of the corporate Social responsibility (csr) policy of the companyand the initiatives undertaken by the company on cSR activities during the year underreview are set out in Annexure 1V of this report in the format prescribed in the companies(corporate Social Responsibility Policy) Rules 2014. for other details regarding the cSRcommittee please refer to the corporate Governance Report which is a part of thisreport. the cSR policy is available on www. satiagroup.com.
Satia industries limited realizes its responsibility towards the society at large.Satia industries Limited recognizes that corporate are economic organs of society andtherefore believes in making a positive difference to the society by trying to build abetter tomorrow. the company assists in running the local Schools and directly organizesvarious programs for social welfare.
The Company has carried out Need Assessment Study' to fulfill the requirements ofits social responsibility under CSR Programs and based on that assessment of demand themanagement has approved Rs. 2.50 crores for CSR program in surrounding villages. Theactivities mentioned therein shall be carried out within a time frame of 5 years (from theyear 2017-18 to 2021-22. the sectors identified under the scope of CSR activities are asfollows:
|Sr. No ||Planned activities under CSR as per specific needs || |
Budgetary P lan (Rs.)
| || ||1st Year ||2nd Year ||3rd Year ||4th Year ||5th Year ||Total |
|1. ||Community Health Improvement || || || || || || |
|i ||Disinfection facilities for dug wells and other potable water sources ||200000 ||200000 ||350000 ||350000 ||300000 ||1400000 |
|ii ||Periodically medical checkup blood donation camps to be organized near project site ||250000 ||250000 ||250000 ||300000 ||350000 ||1400000 |
|iii ||Eye checkup camps ||300000 ||400000 ||500000 ||500000 ||500000 ||2200000 |
|iv ||Health awareness camps for child and mother care health and hygiene practices. ||150000 ||150000 ||200000 ||250000 ||250000 ||1000000 |
| ||Total ||900000 ||1000000 ||1300000 ||1400000 ||1400000 ||6000000 |
|2. ||Community Education Facilities || || || || || || |
|i ||Augmentation of furniture blackboard etc. in village schools ||500000 ||500000 ||500000 ||500000 ||500000 ||2500000 |
|ii ||Award scholarship to meritorious students ||100000 ||100000 ||100000 ||100000 ||100000 ||500000 |
|iii ||Distribution of educational books stationary uniforms and aids etc. ||400000 ||400000 ||400000 ||400000 ||400000 ||2000000 |
| ||Total ||1000000 ||1000000 ||1000000 ||1000000 ||1000000 ||5000000 |
|3. ||Community Welfare activities || || || || || || |
|i ||Worship places development & beautician ||300000 ||300000 ||300000 ||300000 ||300000 ||1500000 |
|ii ||Distribution of seeds & saplings ||100000 ||100000 ||100000 ||100000 ||100000 ||500000 |
|iii ||Promotion & support to various Govt. Schemes ||200000 ||200000 ||200000 ||200000 ||200000 ||1000000 |
| ||Total ||600000 ||600000 ||600000 ||600000 ||600000 ||3000000 |
|4. ||Infrastructural Development || || || || || || |
|i ||Village pond retrieval ||300000 ||300000 ||300000 ||300000 ||300000 ||1500000 |
|ii ||R.o installation ||300000 ||300000 ||300000 ||300000 ||300000 ||1500000 |
| ||Total ||600000 ||600000 ||600000 ||600000 ||600000 ||3000000 |
|5. ||Community Water Conservation || || || || || || |
|i ||rain water harvesting and ground water recharge pits ||500000 ||500000 ||500000 ||500000 ||500000 ||2500000 |
|ii ||Water conservation awareness programs ||100000 ||100000 ||100000 ||100000 ||100000 ||500000 |
| ||Total ||600000 ||600000 ||600000 ||600000 ||600000 ||3000000 |
|6. ||A forestation Programs || || || || || || |
|i ||Plantation of trees in village road side ||500000 ||500000 ||500000 ||500000 ||500000 ||2500000 |
|ii ||Development of nursery ||100000 ||100000 ||100000 ||100000 ||100000 ||500000 |
| ||Total ||600000 ||600000 ||600000 ||600000 ||600000 ||3000000 |
|7. ||Community Capacity Building || || || || || || |
|i ||impairing vocational training for technical skills self-employment training for women as stitching embroidery tailoring handicrafts ||200000 ||300000 ||400000 ||500000 ||600000 ||2000000 |
| ||Total ||200000 ||300000 ||400000 ||500000 ||600000 ||2000000 |
| ||Grand Total ||4500000 ||4700000 ||5100000 ||5300000 ||54000000 ||25000000 |
As part of its initiatives under corporate social responsibility (CSR) thecompany has contributed funds for the schemes of promotion of education and medical aid.
The Annual Report on CSR activities are annexed herewith as Annexure- IV
Report on Corporate Governance
Effective corporate governance practices constitute the strong foundation on whichsuccessful commercial enterprises are built to last. The Company's philosophy on corporategovernance oversees business strategies and ensures fiscal accountability ethicalcorporate behavior and fairness to all stakeholders comprising regulators employeescustomers vendors investors and the society at large. Strong leadership and effectivecorporate governance practices have been the Company's hallmark. the Company has a stronglegacy of fair transparent and ethical governance practices. The company has adopted acode of conduct for its employees including the Managing Director and the executiveDirectors. in addition the Company has adopted a Code of Conduct for its nonexecutivedirectors which includes code of conduct for independent Directors which suitablyincorporates
the duties of independent directors as laid down in the Companies Act 2013 ("theAct"). the Company is in compliance with the requirements stipulated under Regulation17 to 27 read with Schedule V and clauses (b) to (i) of sub-regulation (2) of Regulation46 of Securities and exchange Board of india (Listing obligations and DisclosureRequirements) Regulations 2015 ("SEBI Listing Regulations") as applicablewith regard to corporate governance.
The requisite certificate from the Auditors of the Company confirming compliance withthe conditions of corporate governance is attached to the Report on corporate governance.
The Directors thank the Company's employees customers vendors investors and fortheir continuous support. The Directors also thank the Government of india Governments ofvarious states in india and concerned Government departments and agencies for theirco-operation.
| || ||For and on behalf of the Board of Directors |
|Place : VPO: Rupana ||(Dr Ajay Satia ) ||(R.K.Bhandari) |
|Date : 12.08.2019 ||Chairman Cum Managing ||Joint Managing Director |