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Prima Plastics Directors Report, Prima Plastics Reports by Directors
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Prima Plastics

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Directors Report Year End : Mar '15    Mar 14
 Dear Members,
 
 The Directors submit the 21st Annual Report along with the Audited
 Statement of Accounts of the Company for the year ended March 31,2015.
 
                                                           (Rs. In Lacs)
 
 FINANCIAL
 RESULTS                                    2014-2015         2013-2014
 
 Gross Income                                8,849.59          7,966.36
 
 Profit before Depreciation,
 Finance Cost and Tax                          652.12            684.70
 
 Less : Depreciation                           113.53            163.76
 
 Less : Finance Cost                           106.49            113.61
 
 Profit before Taxation                        432.10            407.33
 
 Less : Current Tax                             87.87             88.44
 
 Profit after Tax                               344.23           318.89
 
 Add : Balance b/f from previous year         2,063.00         1,922.81
 
 Balance available for appropriation          2,407.23         2,241.70
 
 Appropriation :
 
 Balance c/f                                  2,407.23         2,241.70
 
 Less : Proposed Dividend                       165.01           110.00
 
 Less: Dividend Tax                              33.00            18.70
 
 Less : Transfer to General Reserve              50.00            50.00
 
 Less : Adjustment in depreciation
 on Fixed Assets                                 17.91              NIL
 
 Less : Deferred Tax                            136.81              NIL
 
 Balance c/f to Balance Sheet                 2,004.50         2,063.00
 
 OPERATIONAL PERFORMANCE
 
 The consolidated gross revenue of the Company during 2014-15 grew by
 14.37% at Rs. 12,650.62 lacs as compared with Rs. 11,061.20 lacs last
 year. The Company has achieved a standalone gross revenue of Rs.
 9,628.49 lacs during the year under review, as compared with Rs.
 8,710.38 lacs during the previous year a rise of 10.54%.
 
 Consolidated profit before tax increased to Rs. 1,038.26 lacs, as
 compared with Rs. 997.25 lacs in the previous year, an increase of
 4.11% over last year. Standalone profit before tax increased from Rs.
 407.34 lacs to Rs. 432.09 lacs, an increase of 6.08%.
 
 During financial year 2014-15, your Board of Directors have decided to
 close down the business of ACP Division which was incurring losses in
 past many years and looking to continuous slack in commercial segment
 of real estate, the core plant of ACP Division were sold in January
 2015. However the land, building & other machinery were retained to
 accommodate additional requirement of factory space of plastic division
 and also to expand plastic business. The management expects improved
 profitability in future by this decision of closing down of ACP
 Division.
 
 DIVIDEND
 
 Your Directors have recommended a final dividend of Rs. 1.50/- (15%)
 per equity share (last year Rs. 1.00/- per equity share) for the
 financial year ended March 31,2015, amounting to Rs. 198.01 lacs
 (inclusive of tax of Rs. 33.00 lacs), one of the highest payout in
 recent past of the Company on popular demand by shareholders. The
 dividend payout is subject to approval of members at the ensuing Annual
 General Meeting.
 
 The dividend will be paid to members whose names appear in the Register
 of Members as on September 18, 2015; in respect of shares held in
 dematerialized form, it will be paid to members whose names are
 furnished by National Securities Depository Limited and Central
 Depository Services (India) Limited, as beneficial owners as on that
 date.
 
 TRANSFER TO RESERVES
 
 The Company proposes to transfer Rs. 50.00 lacs to the General Reserve
 out of the amount available for appropriations and an amount of Rs.
 2,004.50 lacs is proposed to be retained in the Profit and Loss
 Account. The Reserve on standalone basis, at the beginning of year were
 Rs. 3,150.36 lacs. The Reserve at the end of year are Rs. 3,141.86
 lacs.
 
 PERFORMANCE OF JOINT VENTURE
 
 Prima Dee-lite Plastics Pvt. Ltd., Cameroon is a Joint Venture Company
 manufacturing Moulded Articles and HDPE Woven Sack Bags. The total
 turnover of JV Company for the calendar year ended 2014 was INR
 6,368.96 lacs as compared to previous calendar year of INR 4,724.71
 lacs. The profit for the year after depreciation and tax was INR 479.58
 lacs as compared to INR 436.85 lacs in the previous year.
 
 CONSOLIDATED FINANCIAL STATEMENTS
 
 As required by Accounting Standards AS- 21 and AS-27 of the Institute
 of Chartered Accountants of India, the financial statements of the
 Company reflect the consolidation of the Accounts of the Company, its
 Joint Venture Company Prima Dee-lite Plastics Pvt. Ltd., Cameroon. The
 performance and financial position of Joint Venture Company is detailed
 in ''Statement containing salient features of the financial statement of
 joint ventures'' in form AOC-1 pursuant to section 129 of the Companies
 Act, 2013 is annexed herewith as Annexure A''''.
 
 MANAGEMENT DISCUSSION AND ANALYSIS
 
 A detailed review of the operations and performance of the Company and
 its national & international business are contained in the Management
 Discussion and Analysis Report which form part of the Directors Report.
 
 MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE
 COMPANY
 
 There are no material changes and commitments affecting the financial
 position of the Company which has occurred between the end of the
 financial year of the Company i.e. March 31,2015 and the date of the
 Directors'' Report i.e. August 13, 2015.
 
 MATERIAL ORDERS OF REGULATORS/ COURTS/TRIBUNALS
 
 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.
 
 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186
 OF THE COMPANIES ACT, 2013
 
 There were no loans or guarantees, investments made by the Company
 under Section 186 of the Companies Act, 2013 during the year under
 review and hence the said provision is not applicable.
 
 PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
 
 All contracts or 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. The Company had not entered into
 any contract or transaction with related parties which could be
 considered material in accordance with the provision of the Companies
 Act, 2013.
 
 An omnibus approval has been granted by the Audit Committee of the
 Board for transactions which are of a foreseen and repetitive nature
 with other related parties. Such omnibus approvals are subjected to
 review and monitored by the Audit Committee on a quarterly basis.
 Statement containing salient features of the related party
 transactions'' in form AOC 2 pursuant to section 189 of the Companies
 Act, 2013 is annexed herewith as Annexure B''''.
 
 BUSINESS RISK MANAGEMENT
 
 A risk management policy has been developed and implemented by the
 Company for identification of elements of risk, if any, which in the
 opinion of the Board may threaten the existence of the company. The key
 elements of the company''s risk management framework have been captured
 in the risk management policy which details the process for
 identifying, escalating, prioritizing, mitigating and monitoring key
 risk events and action plans. The assessment of the risks covers
 Strategy, Technology, Financial, Operations & Systems, Legal &
 Regulatory and Human Resources Risks. The effectiveness of the risk
 management framework and systems is periodically evaluated by the Risk
 and Audit Committee.
 
 INTERNAL FINANCIAL CONTROLS
 
 The Company has in place, adequate systems and procedures for
 implementation of internal financial control across the organization
 which enables the Company to ensure that these controls are operating
 effectively.
 
 DIRECTORATE
 
 The appointment and remuneration of Directors is governed by the
 Remuneration Policy of the Company to serve on the Board for guiding
 the Management team to enhanced organizational performance. The
 detailed Remuneration Policy is contained in the Corporate Governance
 section of the Annual Report.
 
 The Company''s Board comprises of six members, Shri Bhaskar M. Parekh,
 Executive Chairman (DIN-00166520) and Shri Dilip M. Parekh, Managing
 Director (DIN - 00166385) represents the Promoter Group and Executive
 Directors. Three other Non-Executive Directors -Shri Mulchand S. Chheda
 (DIN - 00179932), Shri Krishnakant V. Chitalia (DIN - 00443945) and
 Shri Rasiklal M. Doshi (DIN - 00239580) are independent in terms of
 Clause 49 of the Listing Agreement and Companies Act, 2013. Woman
 Director Smt. Hina V. Mehta (DIN -07201194 ) is Additional Director and
 represent Promoter Group. The Directors are reputed persons with
 diverse functional expertise and industry experience relevant to
 fulfilling the Company''s objectives and strategic goals.
 
 None of the Independent Directors are liable to retire at the
 forthcoming Annual General Meeting. All Independent Directors have
 submitted declarations that they continue to meet the criteria of
 independence as laid down under Section 149(6) of the Companies Act,
 2013 and Clause 49 of the Listing Agreement.
 
 As per the provisions of the Companies Act, 2013, Shri Dilip M. Parekh
 retires by rotation at the forthcoming Annual General Meeting and being
 eligible, offers himself for re-appointment to the Board. Pursuant to
 the provisions of Section 161 of the Companies Act, 2013, Smt. Hina V
 Mehta will hold office upto the conclusion of the ensuing Annual
 General Meeting of the Company. The Company has also received notice
 from a member along with the deposit of requisite amount under Section
 160 of the Act proposing the candidature of Smt. Hina V. Mehta for the
 office of Director of the Company.
 
 Their profile details are contained in the accompanying Notice of the
 forthcoming Annual General Meeting and in the Corporate Governance
 Report.
 
 The Board of Directors met 5 times during financial year 2014-15. The
 details of the meetings and the attendance of the Directors are
 mentioned in the Corporate Governance Report.
 
 The Board has established Committees as a matter of good corporate
 governance practice and as per the requirements of the Companies Act,
 2013. The Committees are Audit Committee, Nomination and Remuneration
 Committee, Management Committee, Share Transfer Committee and
 Stakeholders'' Relationship Committee. The composition, terms of
 reference, number of meetings held and business transacted by the
 Committees is given in the Corporate Governance Report.
 
 During the year, the Board has carried out the annual evaluation of its
 own performance as well as the evaluation of the working of its
 Committees and individual Directors, including Chairman of the Board.
 Individual and peer assessment of Directors based on parameters such as
 knowledge, contribution, level of engagement,
 communication/relationship with Board and Senior Management were
 received by the Chairman for individual feedback. The performance
 evaluation of the Chairman was carried out by the Independent
 Directors. The Directors expressed their satisfaction with the
 evaluation process and its result.
 
 The Company periodically discloses its promoter group and persons
 acting in concert in the shareholding pattern and other filings with
 the Stock Exchanges.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 As stipulated in Section134(3)(C) of the Companies Act, 2013, the Board
 of Directors of the Company hereby state and confirm that:
 
 I.  In the preparation of the annual accounts for the year ended March
 31, 2015, the applicable accounting standards read with requirements
 set out under Schedule III to the Companies Act, 2013, have been
 followed and there has been no material departure;
 
 II.  The Directors have selected such accounting policies and applied
 them 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 31,2015 and of the profit of the Company for
 the year ended on that date;
 
 III. The Directors have taken proper and sufficient care to the best of
 their knowledge and ability for the maintenance of adequate accounting
 records in accordance with the provisions of the Companies Act, 2013.
 They confirm that there are adequate system and control for
 safeguarding the assets of the Company and for preventing and detecting
 fraud and other irregularities.
 
 IV.  Directors have prepared the Annual Accounts on a going concern
 basis.
 
 V The Directors have laid down internal financial controls to be
 followed by the Company and that such internal financial controls are
 adequate and are operating effectively; and
 
 VI The Directors have devised proper systems to ensure compliance with
 the provisions of all applicable laws and that such systems are
 adequate and operating effectively.
 
 AUDITORS & AUDITORS'' REPORT
 
 M/s. G.P Kapadia & Co., Chartered Accountants, Mumbai bearing ICAI
 Registration (104768W) was appointed as Auditors of the Company at the
 20th Annual General Meeting to hold office for a period of three years.
 As required under the Companies Act, 2013, the re-appointment of the
 Statutory Auditors is required to be placed before the Members at every
 subsequent annual general meeting for their ratification. Hence, the
 Board, based on the recommendation of the Risk & Audit Committee,
 proposes to ratify the re-appointment of the aforesaid Statutory
 Auditors of the Company at the ensuing Annual General Meeting.
 
 As required under Section 139 of the Companies Act, 2013, the Company
 has obtained a written consent from M/s. G.P Kapadia & Co., to such
 appointment and also a certificate to the effect that their
 appointment, if made, would be in accordance with Section 139(1) of the
 Companies Act, 2013 and the rules made there under, as may be
 applicable.
 
 The notes to accounts referred to in the Auditors'' Report are
 self-explanatory and therefore, do not call for any further comments.
 SECRETARIAL AUDIT
 
 Pursuant to the provisions of Section 204 of the Companies Act, 2013
 and The Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014, the Board appointed Mr. Sadashiv V Shet,
 Practicing Company Secretary to undertake the Secretarial Audit for the
 financial year 2014-2015. The Secretarial Audit Report is annexed
 herewith as ''Annexure C.
 
 INTERNAL AUDIT
 
 The Company continues to engage M/s. S. A. Sangani & Associates,
 Chartered Accountants as its Internal Auditor. Their scope of work
 includes review of processes for safeguarding the assets of the
 Company, review of operational efficiency, effectiveness of systems and
 processes and assessing the internal control strengths in all areas.
 Internal Auditors findings are discussed with the process owners and
 suitable corrective actions taken as per the directions of Audit
 Committee on an ongoing basis to improve efficiency in operations.
 
 EXTRACT OF ANNUAL RETURN
 
 The details forming part of the extract of the Annual Return in form
 MGT 9 is annexed herewith as Annexure D.
 
 VIGIL MECHANISM
 
 The Company has formulated Whistle Blower Policy with a view to
 providing a mechanism for employees to report violations and assure
 them of the process that will be followed to address the reported
 violation. The Policy also lays down the procedures to be followed by
 Senior Management for tracking of complaints, giving feedback,
 conducting investigations and taking disciplinary actions. It also
 provides assurances and guidelines on confidentiality of the reporting
 process and protection from reprisal to complainants.
 
 DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION,
 PROHIBITION AND REDRESSAL) ACT, 2013
 
 As per the requirement of The Sexual Harassment of Women at Workplace
 (Prevention, Prohibition & Redressal) Act, 2013 (''Act'') and Rules made
 thereunder, your Company has constituted Internal Complaints
 Committees. In line with the said provisions, during the year the
 Company has not received any complaints with allegations of sexual
 harassment.
 
 PARTICULARS OF EMPLOYEES
 
 The Company does not have any employee drawing remuneration required to
 be disclosed pursuant to the Section 197 of Companies Act, 2013 read
 with the Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014. The required disclosures with respect to
 Remuneration and other details are set out in Annexure E to this
 Report.
 
 CONSERVATION OF ENERGY, THCHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 Additional information given as required under the Companies
 (Disclosures of Particulars in the report of Board of Directors) Rules,
 1988. ENERGY CONSERVATION
 
 Energy conservation program is an ongoing process, the Company
 continues to emphasize on energy conservation at the stage of
 selections of plant, equipment to optimize energy consumption and by
 installing necessary power saving equipments.
 
 RESEARCH & DEVELOPMENT
 
 The R & D activities carried out by the Company are directly working in
 the supervision and guidance of the Managing Director. The Company has
 been able to launch few new products in plastics in replacement of
 conventional wood and also few new designs of chairs developed
 internally. The Company further plans to develop and introduce new
 range of products in the current year.
 
 TECHNICAL ABSORPTION, ADAPTATION & INNOVATION
 
 The Company has not imported any technology or processes know how. The
 Machines and moulds used for manufacturing products are regularly
 upgraded to cater variety products in line with the market trend and
 demand. The new investments are made in new technology upgraded
 machines & moulds.
 
 As a result, the Company is able to give new & innovative designed
 product and has created strong demand of its products in export market.
 
 FOREIGN EXCHANGE EARNING AND OUTGO
 
 1) Activities relating to exports, initiative taken to increase
 exports; development of new exports market for products and services;
 and export plans:-
 
 The Company''s key markets for international business are Africa, Middle
 East and Latin America. The export products are well established in the
 international market and the exports were higher at Rs. 1,953.01 lacs
 as compared to Rs. 1,863.62 lacs in last year. The growth in export too
 is very impressive at 5% in percentage term due to repeated orders from
 its existing clients.
 
 2) Total foreign exchange used and earned.
 
                                                                    (Rs)
 
                                         2014-2015             2013-2014
 
 Foreign Exchange earned (FOB)
 
  - (Finished Goods)                   173,447,765          171,028,947
 
 Foreign Exchange used
 
 - Capital Goods                         7,494,466            2,927,196
 
 -  Raw Material                        75,902,891          135,973,554
 
 -  Others                               1,368,359            1,678,893
 
 
 FIXED DEPOSITS
 
 The Company has not accepted any Fixed Deposit from the Members or the
 Public during the year.
 
 CORPORATE GOVERNANCE
 
 The Report on Corporate Governance as stipulated under Clause 49 of the
 Listing Agreement forms part of the Annual Report.
 
 The requisite Certificate from the Auditors of the Company confirming
 compliance with the conditions of Corporate Governance as stipulated
 under the aforesaid Clause 49 is attached to this Report.
 
 HUMAN RESOURCE
 
 We believe that people are the backbone of the organization and hence
 we lay great emphasis on optimizing their performance. The Company
 provides employees with a fair and equitable work environment and
 support from the peers to develop their capabilities. The Company
 strongly believes that its team of capable and committed manpower,
 which is its core strength, is the key factor behind all achievements
 and trusting them with the freedom to act and to take responsibility
 successfully. Occupational health and safety are given the utmost
 importance in the Company. The relationship between the Company and the
 employees were cordial and the Company experienced peace and harmony
 through out the year.
 
 ACKNOWLEDGMENT
 
 The Directors wish to convey their gratitude and appreciation to all of
 the Company''s employees at all its locations for their tremendous
 personal efforts as well as their collective dedication and
 contribution to the Company''s performance. The Directors would also
 like to thank the shareholders, customers, dealers, suppliers, bankers,
 government and all other business associates for their continued
 support extended to the Company and the Management.
 
                                         For and on behalf of the Board
 
                                      Bhaskar M. Parekh (DIN - 00166520)
                                                               Chairman
 
 Mumbai,
 August 13, 2015
 
Source : Dion Global Solutions Limited
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