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Pokarna
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Directors Report Year End : Mar '15    « Mar 14
Dear Members,
 
 The Directors are pleased to present the 24th Annual report together
 with the audited accounts of your company for the financial year ended
 31st March, 2015.The summarized consolidated and standalone financial
 performance of your company is as under;
 
 STATE OF AFFAIRS                             (Amount Rsin Lacs)
                                               Standalone
 Particulars 
                                       2014-15               2013- 14
 
 Total income                          19593.36              17049.25
 
 Less-expenditure                      17061.48              16325.25
 
 Profit/(Loss) Before tax and extra-    2531.88                724.00
 ordinary items
 
 Total tax expenses                      906.39                236.13
 
 Extra-ordinary item (refer note.2.23         -                     -
 in consolidated financial statements).
 
 Profit after tax and Extra-ordinary     1625.49               487.87
 item
 
 Balance of Profit & Loss account,       6218.55              2877.12
 brought forward.
 
 Amount transferred from FCCB            1479.05              3035.26
 redemption Reserve
 
 Amount transferred to General                 -                36.60
 Reserve
 
 Proposed dividend (including tax)        223.89               145.10
 Adjustment of carrying amount
 
 of assets ( net of tax ) pursuant to     173.65                    -
 enactment of Schedule — II to the
 Companies Act, 2013
 
 Balance carried to balance sheet        8925.55              6218.55
 
 
 
 
                                              (Amount Rsin Lacs)
                                               Consolidated
 Particulars 
                                       2014-15               2013- 14
 
 Total income                         33350.81              23170.70
 
 Less-expenditure                     29809.59              23643.50     
 
 Profit/(Loss) Before tax and extra-   3541.22               (472.80) 
 ordinary items
 
 Total tax expenses                    1197.03               (892.89)              
 
 Extra-ordinary item (refer note.2.23   791.96                747.63 
 in consolidated financial statements).
 
 Profit after tax and Extra-ordinary    3136.15              1167.72 
 item
 
 Balance of Profit & Loss account,      (592.30)            (4613.58)
 brought forward.
 
 Amount transferred from FCCB            1479.05             3035.26       
 redemption Reserve
 
 Amount transferred to General                 -               36.60        
 Reserve
 
 Proposed dividend (including tax)        223.89              145.10   
 Adjustment of carrying amount
 
 of assets ( net of tax ) pursuant to     184.12                   -
 enactment of Schedule — II to the
 Companies Act, 2013
 
 Balance carried to balance sheet        3614.89             (592.30)   
 
 
 FOREIGN CURRENCY CONVERTIBLE BONDS (FCCB''s):
 
 During the year under review company has redeemed the last leg of its
 Foreign Currency Convertible Bond (FCCB) offering (face value of USD
 2.461 million) as per the negotiated terms with the said bond holders.
 The gain / benefit, cost, charges including foreign exchange gain /
 loss at the close of the year are transferred to Pokarna Engineered
 Stone Limited (subsidiary) as per the Scheme of Arrangement sanctioned
 by Hon''ble Andhra Pradesh High Court and agreement thereto.
 
 DIVIDEND
 
 Looking into the improved financial performance, the Board of Directors
 is pleased to recommend dividend of Rs. 3/- (30%) per Equity share having
 face value of Rs. 10/- each for the year ended 31st March, 2015. The
 dividend payout for the year under review, inclusive of Tax on Dividend
 distribution, is Rs. 223.89 Lacs, resulting in a pay-out of 13.77% of the
 profits of the Company on a stand-alone basis.
 
 TRANSFER TO RESERVES:
 
 During the year under review, Company has not transferred any amount to
 reserves.
 
 NUMBER OF BOARD MEETINGS
 
 During the year under review 7 (Seven) Board meetings were held, the
 details of which are mentioned in the report on Corporate Governance,
 annexed to this report.
 
 KEY MANGERIAL PERSONNEL
 
 During the year under review:
 
 - Mr. Rahul Jain, who retired at the 23rd Annual general meeting of
 the Company, held on 15th September, 2014, was re-appointed in the said
 meeting.
 
 - Ms. Apurva Jain, was appointed as Executive Director of the
 Company, with effect from 09th August, 2014.
 
 - Mr. Viswanath Reddy, Chief Financial Off cer and Mr. Vinay
 Paruchuru, Company Secretary of the Company, were designated as Key
 Managerial Personnel, pursuant to provisions of Companies Act, 2013.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under Section 134(5) of the Companies Act,
 2013, your directors confirm that:
 
 - in the preparation of the annual accounts, the applicable
 accounting standards have been followed along with the proper
 explanation relating to the material departures, if any.
 
 - such accounting policies have been selected and applied them
 consistently and made judgments and estimates that are reasonable and
 prudent so as to give true and fair view of the state of affairs of the
 company at the end of the financial year and of the profit of the
 company for that period;
 
 - proper and suff cient care have 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;
 
 - the annual accounts are prepared on a going concern basis.
 
 - proper internal financial controls had been laid down, to be
 followed by the Company and that such internal financial controls are
 adequate and were operating effectively.
 
 - proper systems had been devised to ensure compliance with the
 provisions of all applicable laws and that such systems were adequate
 and operating effectively.
 
 PERFORMANCE OF SUBSIDIARY
 
 Wholly owned subsidiary of the Company M/s. Pokarna Engineered Stone
 Limited, manufactures and sells artifi cial/ engineered Stone, under
 the brand Quantra Natural Quartz Surfaces, from Pokarna.
 
 Statement containing the salient features of the financial statement of
 the Subsidiary Company are contained in Note 2.35 of the Standalone
 financial statements.
 
 The Policy for determining material subsidiaries as approved may be
 accessed on the Company''s website at the link: http://goo.gl/AkiKD0
 
 AUDIT COMMITTEE
 
 In terms of the requirement of clause 49 of the listing agreement with
 the Bombay Stock Exchange and Section 177 of the Companies Act, 2013,
 your company has constituted Audit committee. The composition of the
 committee & other details are given in the corporate governance report
 which forms part of this annual report.
 
 CORPORATE GOVERNANCE
 
 Your company is committed to maintain the highest standards of
 corporate governance. As required under Clause 49 of the listing
 agreement with the Bombay Stock Exchange, a report on corporate
 governance as well as Auditors certificate on the compliance of
 conditions on corporate governance are annexed and form part of this
 annual report.
 
 All board members and senior management personnel have aff rmed
 compliance with the Code of conduct for the year 2014-15. A declaration
 to this effect signed by the Chairman & Managing Director of your
 company is annexed to this annual report.
 
 MANAGEMENT DISCUSSION AND ANALYSIS
 
 ''Managements Discussion and Analysis Report'' is provided in a
 separate Section and forms part of this annual report.
 
 CONSOLIDATED FINANCIAL STATEMENT
 
 In accordance with the Companies Act, 2013 (the Act) and
 Accounting Standard (AS) - 21 on Consolidated Financial Statements, the
 audited consolidated financial statement is provided in the Annual
 Report.
 
 STATUTORY AUDITOR
 
 The Statutory Auditors of the Company, M/s. S. Daga & Co., Chartered
 Accountants ( Reg. No. 000669S), retire at the conclusion of the
 ensuing Annual General Meeting and being eligible offer themselves for
 re-appointment as per the provisions of the Companies Act, 2013. The
 Audit Committee and the Board of Directors of the Company recommend the
 reappointment of S. Daga & Co., Chartered Accountants, as Statutory
 Auditors of the Company.
 
 The Board has duly reviewed the Statutory Auditors Report on the
 Accounts. The Auditors without qualifying the report have made some
 observations, such observations are self explanatory and therefore do
 not call for any further comments or further explanation by the Board.
 
 The attention of the shareholders is drawn to the Emphasis of
 Matter in the Auditors Report on consolidated financial statements
 of the Company, which is self explanatory.
 
 SECRETARIAL AUDITOR
 
 The board has appointed Mr. K.V Chalamareddy, Practising Company
 Secretary, to conduct secretarial audit for the financial year 2014-15.
 the secretarial audit report for the financial year ended March 31,
 2015 is annexed herewith marked as Annexure IV to this report. the
 secretarial audit report does not contain any qualification,
 reservation or adverse remark.
 
 COST AUDITOR
 
 The Company has appointed M/s. DZR & Co., Cost Accountants, as the Cost
 Auditors of the Company.  DIRECTORS
 
 In accordance with the provisions of the Companies Act, 2013 Mr.
 Prakash Chand Jain, Director of the Company is liable to retire by
 rotation at the ensuing Annual General Meeting and being eligible,
 offered himself for re-appointment. Board of Directors recommends his
 re-appointment.
 
 PARTICULARS OF EMPLOYEES
 
 None of the employees of the company was in receipt of remuneration in
 excess of limits prescribed under Rule 5(2) read with Rule 5(3) of the
 Companies (Appointment Remuneration of Managerial Personnel) Rules,
 2014.
 
 DISCLOSURES RELATED TO REMUNERATION OF DIRECTORS AND KEY MANAGERIAL
 PERSONNEL
 
 Disclosures required as per Section 197(12) of the Companies Act, 2013
 read with Clause 5(1) of Companies (Appointment & Remuneration of
 Managerial Personnel) Rules, 2014, is annexed herewith marked as
 Annexure III.
 
 CONSERVATION OF ENERGY AND TECHNOLOGY CONSUMPTION:
 
 A. Conservation of Energy:
 
 The Company has always been conscious of the need for conservation of
 energy and has been sensitive in making progress towards this
 initiative. The energy conservation efforts in the Company are being
 pursued on a continuous basis. Close monitoring of energy conservation
 is maintained to minimize wastage and facilitate optimum utilization of
 energy. Regular maintenance and repairs of all the equipment''s and
 machineries are carried out to ensure optimum efficiency. The other
 energy conservation measures taken are:
 
 - plants are equipped with high energy effi ciency motors and
 variable frequency drives.
 
 - continuous monitoring of power factor.
 
 - training and awareness programmes for employees were conducted for
 reducing energy waste.
 
 Steps taken by the company for utilizing alternate sources of energy:
 
 - Use of roof mounted self-driven ventilator in plant thereby
 enabling substantial saving in electrical energy. Roof mounted
 self-driven ventilators work on wind assisted ventilation.
 
 - Use of sky lights in the plants to reduce need for lighting during
 daytime.
 
 Capital investment on energy conservation equipments:
 
 During the current financial year, the Company has not incurred any
 capital expenditure on the energy conservation equipment.
 
 B. Technology absorption:
 
 Our Technical team visits international markets to understand and
 explore the possibility of using such latest technology in production
 and processing of our products. Benefits derived as a result of the
 above efforts are in the areas of process simplification, cost
 reduction and quality improvement.
 
 The Company has not imported any technology during the last three
 years. Hence, the particulars with respect to efforts made towards
 technology absorption and benefits derived etc. are not applicable to
 the Company
 
 The Company during the year under review has not carried out any
 activity which can be construed as Research & Development and as of now
 there is no specific plan for engaging into such activities. As such,
 there is no expenditure to report.
 
 FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 During the year under review, the total standalone foreign exchange
 earnings was Rs. 13806.51 lacs and expenditurewas Rs 484.64 lacs.
 
 INTERNAL FINANCIAL CONTROLS
 
 The Company has in place adequate financial controls with reference to
 the financial statements. During the Financial year such controls were
 tested and no reportable material weakness in the design or operation
 were observed.
 
 PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
 
 During the year under review the Company has not made any loans or
 investments or provided any guarantee, pursuant to Section 186 of the
 Companies Act, 2013.
 
 RISK MANAGEMENT POLICY
 
 The Company has kept in place a risk management policy for the Company
 including the identification therein of elements of risks, if any,
 which in the opinion of the Board may threaten the existence of the
 company.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 In line with the provisions of the Companies Act, 2013 and rules made
 there under (the Act), a Corporate Social Responsibility
 (CSR) Committee has been formed by the Board of Directors, Mr.
 Gautam Chand Jain, Mr. Meka Yugandhar and Mr.Vinayak Rao Juvvadi are
 the members of the CSR Committee. Your Company has identified Health,
 Sanitation, Education and Environment as thrust areas for CSR
 activities.
 
 The Annual Report on CSR activities is annexed herewith marked as
 Annexnre II.
 
 During the year under review Company has not spent the amount of Rs.
 4,94,087/- out of the prescribed expenditure of Rs. 10,59,187/- (i.e. 2%
 of the average net profits). Company is cautious about identifying the
 projects, in order ensure that the projects are optimally benefitted to
 the society at large. Hence there was delay in identifying the suitable
 projects and spending the required amount, during the year. However,
 management is taking steps to spend the remaining amount along with the
 CSR expenditure to be incurred for the Financial Year 2015-16.
 
 CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:
 
 All Contracts/arrangements/transactions entered by the Company during
 the financial year with related parties were in compliance of Section
 188 of the Companies Act, 2013 read with Clause 49 of the Listing
 Agreement.
 
 The policy on materiality of related party transactions and dealing
 with related party transactions as approved by the Board may be
 accessed on the Company''s website at the link: http://goo.gl/d4DC7f
 
 Your Directors draw attention of the Members to Note 2.27 of the
 financial statement which sets out the related party transactions.
 
 POLICY ON VIGIL MECHANISM
 
 The Policy on vigil mechanism/whistle blower policy may be accessed on
 the Company''s website at the link: http:// goo .gl/VaWjyV
 
 EXTRACT OF ANNUAL RETURN
 
 Extract of Annual Return of the Company is annexed herewith as Annexnre
 I to this Report.
 
 GENERAL
 
 Your Directors state that no disclosure or reporting is required in
 respect of the following items as there were no transactions on these
 items during the year under review:
 
 1. Details relating to deposits covered under Chapter V of the Act.
 
 2. Issue of equity shares with differential rights as to dividend,
 voting or otherwise.
 
 3. Issue of shares (including sweat equity shares) to employees of the
 Company under any scheme.
 
 4. Neither the Managing Director nor the Whole-time Directors of the
 Company receive any remuneration or commission from any of its
 subsidiaries.
 
 5. No significant or material orders were passed by the Regulators or
 Courts or Tribunals which impact the going concern status and
 Company''s operations in future.
 
 Your Directors further state that during the year under review, there
 were no cases filed pursuant to the Sexual Harassment of Women at
 Workplace (Prevention, Prohibition and Redressal) Act, 2013.
 
 ACKNOWLEDGEMENTS
 
 Your Directors express their appreciation for the support, trust and co
 operation received from the banks, Government authorities, customers,
 suppliers, shareholders and other stakeholders during the year under
 review.
 
 Your Directors acknowledge with gratitude the commitment and dedication
 of the employees at all levels, which has contributed to the growth and
 success of the company.
 
 Your Directors look forward to the continued support from all of you in
 the years to come.
 
 Date : 25.05.2015 
 Place : Secunderabad
 
 Registered Office:
 105, First Floor, Surya Towers,
 S. P. Road,
 Secunderabad- 500 003.
 CIN : L14102TG1991PLC013299
 Tel :  91 40-27842182 Fax:  91 40-2784 2121
 Email : contact@pokarna.com
 Website : www.pokarna.com
 
                                            By order of the Board
 
                                            Gautam Chand Jain
                                            Chairman & Managing Director 
                                            (DIN: 00004775)
 
Source : Dion Global Solutions Limited
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