Your Directors have pleasure in presenting the Fiftieth Annual Report togetherwith the Audited Financial Statements of the Company for the financial year ended 31March 2016.
1. FINANCIAL RESULTS:
| ||2015 2016 ||2014 - 2015 |
| ||Rs.in Lakhs ||Rs.in Lakhs |
|Net Sales including Trading and Operating Income ||28370.14 ||25934.95 |
|Other Income ||387.45 ||477.65 |
|Cash Profit/(Loss) before Extraordinary Items and Taxes ||3997.63 ||2433.55 |
|Profit/(Loss) before Tax ||3167.37 ||1575.63 |
|Provision for Taxation || || |
|Current: || || |
|(i) Current Tax (MAT) ||1059.00 ||286.55 |
|(ii)Deferred Tax (Asset) / Liability ||(29.27) ||195.59 |
|(iii) Tax adjustment for earlier years ||9.86 ||(12.31) |
|Profit/(Loss) after Tax ||2127.78 ||1105.80 |
|Balance brought forward from Previous Year ||2200.10 ||1696.60 |
|Amount available for appropriation ||4327.88 ||2802.40 |
|Appropriations to: || || |
|a) Proposed Dividend ||440.40 ||293.60 |
|b) Tax on Proposed Dividend ||89.66 ||58.70 |
|c) Transfer to General Reserve ||300.00 ||250.00 |
|d) Balance Carried to Balance Sheet ||3497.82 ||2200.10 |
|TOTAL ||4327.88 ||2802.40 |
Note : Previous year figures have been regrouped / rearranged wherever necessary.
2. AMOUNT TO BE TRANSFERRED TO GENERAL RESERVE:
Your Board of Directors have decided to transfer a sum of Rs.30000000/- to GeneralReserve constituting to 14.10% of Profits.
Your Directors have recommended a dividend of Rs.7.50/- (i.e. 75%) per equity share ofRs.10/- on the Equity Share Capital of Rs.587.20 lakhs for the year ended 31st March 2016(Previous Year [PY]: 50% i.e. Rs.5/-).
The dividend will be paid to members whose names appear in the Register of Members ason 29th July 2016 and in respect of shares in dematerialized form it will be paid tomembers whose names are furnished by National Securities Depository Limited and CentralDepository Services (India) Limited as beneficial owners as on that date.
4. RESULTS OF OPERATIONS AND THE STATE OF COMPANYS AFFAIRS:
1. The net sale (excluding Excise Duty) of the Company for the year under review isRs.278.34 Crores as compared to Rs.257.38 Crores in the previous year an increase of8.15%.
2. Exports registered Rs.180.26 Crores (PY: Rs.161.50 Crores) an increase of 11.62%and domestic sale registered Rs.98.07 Crores (PY: Rs.95.88 Crores) an increase of 2.3%.
3. During the financial year 2015-2016 the Company registered net profit of Rs.21.28Crores as against net profit of Rs.11.05 Crores in the previous year an increase of92.5%.
Performance in the year 2015-2016 improved over the previous year due to variousfactors including aggressive marketing and sales efforts maintaining quality deliveryservices and EHS Standards to remain the preferred supplier.
Your Company has been continually taking several initiatives aimed at improvingefficiencies.
We expect the business conditions to remain stable for your Company expecting amoderate growth in volumes in the year 2016-2017.
However the world markets are uncertain at present and many countries are facing majoreconomic issues affecting their growth in the year 2016-2017. In such a situation yourCompany is planning such steps and strategies keeping in view the various applications ofthe Companys products that can help to mitigate impact of negative events in theworld economy.
The key drivers to growth in todays scenario would be higher operatingefficiency sustainability customer satisfaction improving capabilities and marketshare expanding product mix and exploring newer markets. It would also be important tohave an excellent EHS record.
The Company is also making substantial investments in new plants and facilities tocapture the potential for growth in the coming years.
6. QUALITY ENVIRONMENT HEALTH AND SAFETY MANAGEMENT SYSTEMS:
The Companys existing Integrated Management System is accredited with QMS ISO9001: 2008 EMS ISO 14001:2004 and BS OHSAS 18001: 2007 certification by TUV NORD - acertification agency. The Company is totally committed to ensure protection of theenvironment and maintenance of biodiversity. The Company has been taking severalinitiatives to achieve this goal.
The Company places a strong emphasis on ensuring safety of the employees andsurrounding population and has robust safety management systems in place. The Company is amember of the Indian Chemical Council and signatory to Responsible Care aChemical Industry initiative.
7. SUBSIDIARY COMPANIES:
Transpek Industry (Europe) Limited (TIEL) is a wholly owned subsidiary ofthe Company and during the year under review it has continued to provide services tosome of the Indian companies under REACH regulations. The expenses incurred during theyear are apportioned to and recovered from Transpek Industry Limited the holding companyand other participating companies resulting in there being no profit and no loss.
8. DISCLOSURE UNDER THE COMPANIES ACT 2013 (the Act):
Information given below is pursuant to various disclosure requirements prescribed underthe Companies Act 2013 (hereinafter the Act) and the rules thereunder to theextent applicable to the Company. Some of the disclosures have been included inappropriate places in the Corporate Governance Report as prescribed under the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 [hereinafter 'SEBI(LODR) Regulations'] which is a part of the Annual Report.
a) CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 is annexed to this report as
b) EXTRACTS OF ANNUAL RETURN AND OTHER DISCLOSURES UNDER COMPANIES (APPOINTMENT &REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014:
The extract of the Annual Return in form no. MGT 9 as per Section 134(3)(a) of the Actread with Rule 8 of Companies (Accounts) Rules 2014 and Rule 12 of Companies (Managementand Administration) Rules 2014 is annexed to this report as Annexure II.
c) REMUNERATION POLICY AND INFORMATION REGARDING REMUNERATION:
Particulars of the Companys Remuneration Policy and information pursuant to Rule5(1) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules 2014are annexed to this report as Annexure III.
d) PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
During the year under review your Company has not directly or indirectly -
a) given any loan to any person or other body corporate other than usual advancesenvisaged in a contract of supply of materials if any;
b) given any guarantee or provided security in connection with a loan to any other bodycorporate or person; and
c) acquired by way of subscription purchase or otherwise the securities of any otherbody corporate.
e) RELATED PARTY TRANSACTIONS:
During the year under review all the Related Party Transactions were in the ordinarycourse of the business and on an arms length basis. Those transactions were placedbefore the Audit Committee of Directors for prior approval in the form of omnibus approvalas provided in SEBI (LODR) Regulations.
Also during the year transactions with M/s. Anshul Life Sciences a related party ofthe Company were material related party transactions as per Regulation 23 of the SEBI(LODR) Regulations but in the ordinary course of business and on an arms lengthbasis as per Section 188(1) of the Act. Approval of the shareholders was obtained pursuantto Clause 49(VII) of the Listing Agreement at the 49th Annual General Meeting of theCompany held on 21.09.2015 for a period of three years w.e.f. 01.10.2015 to 30.09.2018.Details relating to those transactions have been mentioned in Annexure form AOC 2 pursuantto clause (h) of sub-section (3) of section 134 of the Act read with Rule 8(2) of theCompanies (Accounts) Rules 2014 attached as Annexure IV to this report.
During the year under review the Board of Directors have revised the existing RelatedParty Transactions Policy in line with the recently introduced SEBI (LODR) Regulations andCompanies (Meetings of Board and its Powers) Second Amendment Rules 2015.
The revised policy on materiality of related party transactions etc. as approved by theBoard is placed on the Companys website on the link: www.transpek.com.
Your Directors draw attention of the members to Note no.29(C) to the financialstatement which sets out related party disclosures.
f) RISK MANAGEMENT:
Pursuant to the provisions of section 134(3)(m) of the Act and Regulation 21 of SEBI(LODR) Regulations the Company has formulated a policy to identify and evaluate businessrisks and opportunities. This framework seeks to create transparency minimize adverseimpact on the business objectives and enhance the Companys competitive advantage.
The Company has also put a mechanism in place for managing risk factors in technicaland commercial areas. The Risk Management Procedures adopted by the Company are developedon the basis of ISO: 31000 standard.
Although the Company is not mandatorily required to constitute a Risk ManagementCommittee it has constituted such a Committee to monitor and review the Risk ManagementPlan of the Company comprising of the following:
|1. Shri Bimal V. Mehta ||: Executive Director & Chairman of the Committee |
|2. Shri Ravi A. Shroff ||: Promoter Director & member of the Committee |
|3. Shri R. B. Shetty ||: Vice President Technical |
g) EVALUATION OF THE PERFORMANCE OF THE BOARD COMMITTEES OF DIRECTORS AND INDIVIDUALDIRECTORS:
Pursuant to the provisions of the Act and Regulation 17 of SEBI (LODR) Regulations theBoard has carried out an annual performance evaluation of its own performance thedirectors individually as well as of the working of its Audit Nomination &Remuneration and other Committees of the Board. The manner in which the evaluation hasbeen carried out has been explained in the Corporate Governance Report.
h) MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF FINANCIAL YEAR OF THE COMPANY TO WHICH THEFINANCIAL STATEMENT RELATE AND THE DATE OF THE REPORT:
There were no material changes and commitments that have affected the financialposition of the Company which have occurred between the financial year ended on 31.03.2016and the report dated 24.05.2016.
i) ADEQUACY OF INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate and effective Internal Financial Controls withreference to financial statements. During the year such controls were tested and upgradedand no reportable material weaknesses in the design or operation were observed.
j) CORPORATE SOCIAL RESPONSIBILITY:
Your Company has been contributing in the development of the surrounding areas sinceits inception. The Company supports and contributes in activities relating to promotion ofeducation sports medical and health care vocational skill development and livelihoodenhancement and programmes and activities relating to environment sustainability etc.
These projects and activities are in compliance with Schedule VII of the Act.
In the field of education your Company continued to impart basic computer literacy tostudents of several primary schools situated in the vicinity of the Companys factorypremises. Your Company has installed an educational software viz. LearningDelight in those primary schools as a result of which 5220 students studying inStds. I to VIII were imparted education during the year.
During the year your Company provided support to Shroffs Foundation Trust (SFT)running a fully equipped Mobile Medical Unit for providing medical services in the tribalarea of Chhotaudepur district. Through this support several health issues of tribalresidents of Chhotaudepur have been attended to and resolved.
Also your Company continues to make substantial contribution in the upgradation oftraining facilities at the Industrial Training Institute (ITI) at Padra and by conductingshort term courses on plumbing and wiring for the inmates of the Vadodara Central Jail inorder to enable them to earn their livelihoods in a dignified manner after their releasefrom jail.
In addition to the CSR activities that the Company undertakes the employees are alsomotivated to render social services. They have been donating blood regularly and alsocontributing one day salary (matched by equivalent contribution by the Company) towardsexpenditure on rural sanitation. Toilets were built for 38 families and 4 toilets werebuilt in primary schools in the vicinity of the Companys factory premises.
A brief outline of the policy and the Annual Report on CSR Activities is annexed tothis report as Annexure V.
k) PARTICULARS OF EMPLOYEES:
The information required under Section 197 of the Act read with Rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed asAnnexure VI and forms part of this report.
l) SECRETARIAL AUDITOR AND SECRETARIAL AUDITORS REPORT:
Pursuant to the provisions of Section 204 of the Act and the Rules made thereunder theBoard of Directors has appointed Shri Vijay L. Vyas Practising Company Secretary (FCS:1602; CP No. 13175) Vadodara as the Secretarial Auditor of the Company to conductSecretarial Audit for the year ended 31st March 2016. The Secretarial Auditor hassubmitted his Report on Secretarial Audit conducted by him which is annexed to this reportas Annexure VII. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Shri Ashwin C. Shroff Director and Non-Executive Chairman of the Company will retireby rotation at the ensuing Annual General Meeting and being eligible offers himself forre-appointment. The Directors recommend his re-appointment.
Shri Atul G. Shroff is the Managing Director and Shri Bimal V Mehta is the ExecutiveDirector of the Company. Shri Ashok P. Shah is the Vice President and Chief FinancialOfficer of the Company as required under section 203 of the Act. During the year underreview your Board of Directors appointed Shri Alak D. Vyas as CompanySecretaryas required under section 203 of the Act and designated as Dy. CompanySecretary and Compliance Officer of the Company w.e.f. 1st June 2015.
10. DIRECTORS RESPONSIBILITY STATEMENT:
Pursuant to the requirements under section 134(3)(c) of the Act with respect toDirectors Responsibility Statement the Directors state that:
a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
b) the directors had selected such accounting policies and applied them consistentlyand made judgements 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 and loss of the Company for that period;
c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts on a going concern basis;
e) the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
11. DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed under the Act as wellas under Regulation 25 of SEBI (LODR) Regulations.
12. CORPORATE GOVERNANCE:
A separate report on Corporate Governance as required under Regulation 34 of the SEBI(LODR) Regulations 2015 is included in this Report along with a certificate of theAuditor confirming its compliance with the conditions of Corporate Governance stipulatedunder the said Regulation.
13. AUDITORS AND AUDITORS REPORT:
a) STATUTORY AUDITORS:
The members of the Company had at their 49th Annual General Meeting held on 21stSeptember 2015 appointed M/s. CNK & Associates LLP Chartered AccountantsVadodara as Statutory Auditors of the Company for a period of five years i.e. from theconclusion of the 49th Annual General Meeting upto the conclusion of the 54th AnnualGeneral Meeting as prescribed under Section 139(2) of the Act and relevant rules framedthereunder subject to their appointment being ratified every year by the members of theCompany.
Accordingly M/s. CNK & Associates LLP Chartered Accountants Vadodara have givena letter to the Company certifying that their appointment as Auditors would be inconformity with the limits specified in Section 139(2) of the Act for ratifying theirappointment as Statutory Auditors for the financial year 2016-2017.
The Company has placed the matter of ratification of their appointment as StatutoryAuditors of the Company for the financial year 2016-2017 for the approval of the membersat this Annual General Meeting.
The Notes on financial statement referred to in the Auditors Report areself-explanatory and do not call for any further comments. The Auditors Report doesnot contain any qualification reservation or adverse remark.
b) COST AUDIT COMPLIANCE:
The Board has appointed M/s. Y.S.Thakar & Co. Cost Accountants as the CostAuditors for conducting cost audit of cost records of the Company for the Financial Year2016-2017.
Pursuant to Section 209(1)(d) of the Companies Act 1956 Cost Audit Report for thefinancial year ended 31st March 2015 was submitted to the Central Government on 27thJuly 2015.
a) AUDIT COMMITTEE:
The details of the composition of the Audit Committee of Directors of the Company havebeen mentioned in the Corporate Governance Report.
Also during the year under review there were no such instances wherein the Board ofDirectors of the Company did not accept the recommendations of the Audit Committee.
More details about all the Committees of Directors are given in the CorporateGovernance Report.
b) MEETINGS OF THE BOARD:
During the year under review 6 Board meetings were held. For further details pleaserefer to the Report on Corporate Governance.
c) VIGIL MECHANISM:
The Company has a Whistle Blower Policy to report genuine concerns or grievance. TheWhistle Blower Policy has been posted on the website of the Companyhttp://www.transpek.com/pdf/whistle-blower-policy.pdf
15. CHANGE IN THE NATURE OF BUSINESS:
During the year under review there was no change in the nature of the business of theCompany.
16. FIXED DEPOSITS:
During the year under review your Company has accepted deposits amounting toRs.50036000/-. The deposits that remained unpaid or unclaimed as at 31.03.2016 amountto Rs.619000/-. The Company has written reminders to the Depositors to take appropriateaction in this regard.
During the year there has been no default in repayment of deposits or payment ofinterest thereon. Also during the year there were no deposits accepted by the Companywhich did not comply with the requirements of Chapter V of the Act.
17. STOCK EXCHANGE:
The Companys equity shares are listed on the BSE Limited and the Listing Fees ofthe Company for the Financial Year 2015-2016 have been paid. The address of the saidExchange is as under:
Phiroze Jeejeebhoy Towers
Dalal Street Fort Mumbai 400 001.
Scrip ID: transpek; Scrip Code: 506687; Group: XC; ISIN:INE687A01016
18. HEALTH CARE AND WELFARE OF EMPLOYEES:
Employees Welfare Schemes such as subsidized food in the Companys canteenat the factory medical facilities Group Mediclaim insurance and Group Accident insurancecontinued to be maintained by the Company. Sports and cultural activities were also givendue importance. Monetary support is also given to employees who wish to acquire highereducational qualifications.
Merit awards are also given to employees children. The Company promotesinnovation rewards performance and provides opportunities for people to grow. Inaddition your Company has put in place a range of initiatives for attracting andretaining a high performance work force. The Company also rewards exemplary performancesof employees.
19. DISCLOSURE UNDER THE SEXUAL HARASSMENT AT WORK-PLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013:
The Company has been employing a number of women in various cadres. It has put in placea Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013. An internal committee ofwomen employees is also set up to redress complaints received which are monitored by womensupervisors who are fully aware of the Policy and redressal mechanism. All employees ofthe Company those of contractors as well as trainees are covered under this Policy. Nocomplaint was received from any employee during the financial year 2015-2016 and hence nocomplaint is outstanding as on 31.03.2016 for redressal.
20. MANAGEMENT DISCUSSION AND ANALYSIS:
The report on Management Discussion and Analysis dealing with the Operations BusinessPerformance etc. is given separately and it forms part of this Annual Report.
Your Directors wish to acknowledge the co-operation and assistance extended to theCompany by the Companys Bankers and State Government agencies. Your Directors alsowish to place on record their appreciation of the contribution made by employees at alllevels towards the growth of the Company. Your Directors also acknowledge with gratitudethe support of the shareholders other investors customers and suppliers for the faithreposed in the Company and its management.
| ||BY ORDER OF THE BOARD |
|PLACE: Vadodara ||A. C. SHROFF |
|DATED: 14.06.2016 ||CHAIRMAN |
Annexure V: Annual Report on Corporate Social Responsibilities (CSR) Activities:
1. A brief outline of the Companys CSR policy including overview of projects orprograms proposed to be undertaken and a reference to the web-link to the CSR Policy andprojects or programs.
CSR policy is stated herein below.
2. The composition of the CSR Committee: a. Smt. Geeta A. Goradia : IndependentDirector & Chairperson of the Committee b. Shri Dipesh K. Shroff : PromoterNon-executive Director c. Shri Atul G. Shroff : Managing Director
3. Average net profit of the Company for last three financial years: Rs.1125.79 Lacs
4. Prescribed CSR Expenditure (%) of the amount as mentioned in item 3 above: Rs.22.52Lacs
5. Details of CSR spent during the financial year: a. Total amount to be spent for thefinancial year : Rs.22.52 Lacs b. Amount unspent if any: Rs.7.95 Lacs c. Manner in whichthe amount spent during the financial year is detailed below:
|(1) ||(2) ||(3) ||(4) ||(5) ||(6) ||(7) ||(8) |
|Sr. No. ||CSR project or activity identified. ||Sector in which the Project is covered (clause no. of Schedule VII of Co. Act 2013 as amended). ||Projects or programs (1) Local area or other (2) Specify the State and district where projects or programs was undertaken ||Amount outlay (budget) project or programs wise (Amt. in Rs.) ||Amount spent on the projects or programs Sub-heads: (1) Direct expenditure on projects or programs. (2)Overheads. (Amt. in Rs.) ||Cumulative expenditure upto the reporting period. i.e. FY 2015- 2016 (Amt. in Rs.) ||Amount spent: Direct or through implementing agency |
|1. ||Providing Financial Assistance to Shroffs Foundation Trust for operating Mobile Medical Unit in Tribal Area ||Cl.(i) promoting healthcare including preventive health care. ||Chhotaudepur Gujarat ||1200000/- ||1200000/- ||1200000/- ||Through implementing agency - Shroffs Foundation Trust. |
|2. ||Provided 20 Litre Drinking Water jug to a School near the Companys plant premises. ||Cl.(i) making available safe drinking water ||Vadodara Gujarat ||6288/- ||6288/- ||6288/- ||Directly spent by the Company. |
|3. ||Provided financial contribution to Mukhyamantri Swacchta Nidhi for Swacch Bharat Programme ||Cl.(i) promoting healthcare including preventive healthcare and sanitation [including contribution to Swachh Bharat Kosh set up by Central Government for promotion of sanitation] ||Vadodara Gujarat ||50000/- ||50000/- ||50000/- ||Directly spent by the Company. |
|4. ||Provided Financial contribution to Bhavan for slum area development ||Cl.(xi) slum area Bhulka development ||Vadodara Gujarat ||11000 ||11000 ||11000 ||Directly spent by the Company. |
|5. ||Providing Software for imparting Education to Schools nearer to Companys plant premises ||Cl.(ii) promoting education ||Vadodara Gujarat ||114788 ||114788 ||114788 ||Directly spent by the Company. |
|6. ||Payment made to IMC of ITI Padra for training of Jail inmates ||Cl.(ii) enhancing vocational skills ||Vadodara Gujarat ||75000 ||75000 ||75000 ||Directly spent by the Company. |
| ||Total CSR Expenses Incurred || || ||1457076 ||1457076 ||1457076 || |
6. The Company has spent Rs.14.57 lacs on CSR Activities during the year which is onlyRs.7.95 lacs less than the amount of two percent of the average net profit of the lastthree financial years or any part thereof as the objective of the Company is to create atransformation in the lives of the communities where the Company carries out its CSRactivities. The focus has been on implementing projects which can provide long term &sustainable benefits. The various CSR activities that are undertaken may be spread over anumber of years and the CSR Expenditure will depend on the funds requirement at eachstage.
7. A responsibility statement of the CSR Committee that the implementation andmonitoring of CSR policy is in compliance with CSR objectives and Policy of the Company:Statement is given below:
The Responsibility Statement of the Corporate Social Responsibility Committee of theBoard of Directors of the Company is reproduced below:
The implementation and monitoring of Corporate Social Responsibility (CSR)Policy is in compliance with CSR objectives and policy of the Company.
|Sd/- ||Sd/- |
|Atul G. Shroff ||Geeta A. Goradia |
|Managing Director ||Chairman of the CSR Committee |