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Balkrishna Paper Mills Directors Report, Balkrishna Reports by Directors
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Balkrishna Paper Mills

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Download Annual Report PDF Format 2017 | 2016 | 2015
Directors Report Year End : Mar '18    Mar 16

To The Members of,

Balkrishna Paper Mills Ltd

The Directors have pleasure in presenting the Fifth Annual Report of the Company along with Audited Financial Statements for the Financial year ended 31st March, 2018.

1. FINANCIAL RESULTS:

The summary of the financial performance of the Company for the financial year ended March 31, 2018 compared to the previous year ended March 31, 2017, is given below

(Rs. in Lakhs)

Particulars

2017-18

2016-17

Net Turnover and Other Income

21,104.79

19,096.88

Profit/(Loss) before Depreciation, and Tax

(3,106.71)

(1,397.92)

Less: Depreciation and Amortisation

682.90

577.04

Profit/(loss) before Tax

(3,789.60)

(1,974.96)

Less: Provision for Taxation

Current Tax (MAT)

0.00

0.00

Deferred Tax (Net)

229.17

370.92

Profit after Tax

(4,018.77)

(2,345.88)

Add/(Less):Other Comprehensive Income (net of taxes)

(5.70)

(3.77)

Total Comprehensive Income/ (Expenses) for the year

(4,024.47)

(2,349.65)

Pursuant to the notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from 1st April, 2017. Financial Statements for the year ended and as at 31st March, 2017 have been restated to confirm with Ind AS.

2. OPERATIONS:

During the year under review, the Gross turnover and other Income of your Company increased to Rs. 21,104.79 Lakhs from Rs. 19,096.88 Lakhs in the previous year. The net Loss after tax stood at Rs. 4,024.47 Lakhs against Loss of Rs. 2349.65 Lakhs in the previous year.

3. DIVIDEND

Your Directors have not recommended any dividend for the financial year under review

4. SHARE CAPITAL:

The paid up Share Capital of the Company as on 31st March, 2018 are as under:

- Equity Share Capital : Rs. 1074 Lakhs

- Preference Share Capital: Rs. 2500 Lakhs

During the year under review, the Company has issued and alloted 25,00,000 - 9% Cumulative Redeemable Preference Shares of Rs. 100/- each aggregating Rs. 25,00,00,000/- on Private Placement basis to Siyaram Silk Mills Limited on 09/08/2017.

The Company has not issued shares with differential voting rights nor granted stock options nor sweet equity. As on 31st March, 2018, none of the Directors of the Company hold convertible instruments in the Company.

5. REVISION OF FINANCIAL STATEMENT:

There was no revision of the financial statements for the year under review.

6. MANAGEMENT DISCUSSION AND ANALYSIS

Outlook

This outlook is based on assessment of the current business environment. It may vary due to future economic and other developments, in India and abroad.

Company’s Overview

Your Company is engaged in manufacturing and marketing of quality coated Paper and Paper Boards. During the year under review, significant economic measures were implemented by the Government. After demonetisation, GST was implemented w.e.f. 01-07-2017, one nation, one tax expected yield better results in the long term, however, in the short term, it had a dampening effect on the Indian economy. The result of these were evident as GDP came crashing to three year low at 5.7% in the first quarter of 2017-18. With the change in the tax laws, the procurement of the raw material, i.e., waste paper has become very tough and also cost of the same has gone up along with the other related expenses. In the meantime, due to the bad market condition prevailed we could not increase the realisation rates in line with the expenses. In the export market too, there were teething problems and delay in getting the GST refunds etc. All these factors affected the performance of the Company. The global demand for Paper and Paper Board is increasing. As per AIPIMA Indian Paper market is growing @ around 8% and value added Coated Board @ 15% per annum. The Company is trying to improve its realisation by manufacturing more value added products, in the meanwhile expanding its market base in domestic as well as overseas market. The various products launched by the Company in the export market is giving encouraging results. Company has obtained ‘Authorized Economic Operator-T1 Certificate’ for availing various exports and imports benefits. All these efforts will help the Company to improve its overall performance. Internal Audit and Control

Your Company’s internal systems are adequate and commensurate with the size of operations. These controls ensure that transactions are authorized, recorded and reported on time. They ensure that assets are safeguarded and protected against loss or unauthorized disposal. The Company has appointed external independent internal audit agency to carry out concurrent internal audit at its factories and registered office.

Opportunities threats and Risk

Increasing population, literacy rate, growth in GDP, improvement in manufacturing sector and lifestyle of individuals are expected to account for the growth in the paper industry of India. Many of the existing Paperboard players are increasing their capacity to meet the growing demand. A threat could be due to (a) new competitor; (b) Price wars with competitors; (c) Competitors superiors distributions channels.

Human Resources

The company believes that its ability to put up excellent performances lies in its ability to work as a team. Therefore, it emphasizes on providing equal opportunities to all employees.

The Management persistently promote a culture of employee recognition and motivation. The Company reinforces capabilities through in house & out door training programmes.

Forward Looking Statement

Statements in the Management Discussion and Analysis describing the Company’s objectives, predictions may be “forward looking statements” within the meaning of applicable laws and regulations. The actual results could differ materially from the forward looking statements contained in this document due to certain risks and uncertainties, which include the effect of economic and political conditions in India, Government policies, new regulations that may affect the Company business.

7. CORPORATE GOVERNANCE:

A report on Corporate Governance as stipulated in SEBI (LODR) Regulations, 2015, together with Certificate from the Auditors of the Company confirming compliance of conditions of Corporate Governance as stipulated under the aforesaid regulations, forms part of the Annual Report.

8. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board of directors & key managerial personnel

Shri Shrutisheel Jhanwar, Director, retires by rotation and being eligible, offers himself for re-appointment. Your Directors commend his re-appointment.

During the year, Shri Sachindra Nath Chaturvedi, ceased to be Director from the Board of Directors of the Company with effect from 13th October, 2017, as he has incurred disqualification under Section 164(2) of the Companies Act, 2013 and he has vacated his office under Section 167 of the Companies Act, 2013. The Board of Directors placed on record their gratitude and appreciation for immense contribution made by him during his tenure as Director of the Company.

Shri Ramanlal B. Golecha, on the recommendation of the Nomination and Remuneration Committee, was appointed as an Additional Director by the Board w.e.f. 20th November, 2017 and who holds office up to the date of ensuing Annual General Meeting (AGM). Shri Ramanlal B. Golecha is eligible to be appointed as an Independent Director. It is proposed to appoint Shri Ramanlal B. Golecha as an Independent Director, not liable to retire by rotation, for a period of five years from date of appointment.

The Board of Directors on the recommendation of Nomination and Remuneration Committee has approved the re-appointment and remuneration of Shri Anurag Poddar, Chairman and Managing Director, Shri Ankit Poddar, Executive Director and Shri Shrutisheel Jhanwar, Whole time Director & Chief Financial Officer for a further period of 3 years with effect from 11th February, 2018, subject to approval of shareholders. Necessary resolutions have been put up in the Notice of ensuing AGM for approval of the members. Your Directors commend their re-appointment.

Brief particulars of Directors being appointed/re-appointed as required by the SEBI (LODR) Regulations, 2015 and Secretarial Standards on General Meetings are provided in the Annexure to the notice convening the AGM of the Company declarations by independent directors:

The Company has received declarations from all the

Independent Directors under Section 149(6) of the Companies Act, 2013 confirming that they meet the criteria of independence prescribed under the Act and the Listing Regulation.

9. NOMINATION AND REMUNERATION COMMITTEE:

The composition, role, terms of reference as well as powers of the Nomination and Remuneration Committee of the Company meets the requirements of Section 178 of the Companies Act, 2013 and Regulation 19 of the SEBI (LODR) Regulations, 2015.

Composition :

The Committee comprises of 3 Independent Directors.

The composition of the Nomination and Remuneration Committee, category of members, their attendance at the Committee Meetings held during the year under review is given in the table below:

Sr. No.

Name of the Director

Category

Number of Meetings *

Held

Attended

1

Shri Ramanlal B. Golecha#

Independent Director

2

1

2

Shri Harish N. Motiwalla

Independent Director

2

2

3

Shri Rakesh N. Garodia

Independent Director

2

2

4

Shri Sachindra Nath Chaturvedi$

Independent Director

2

Nil

* During the year the committee met 2 times on following dates i.e. 20.11.2017 and 30.01.2018.

# Appointed as an Independent Director w.e.f. November 20, 2017

$ Shri Sachindra Nath Chaturvedi, being disqualified under Section 164(2) of the Companies Act, 2013, has vacated his office as a director of the Company w.e.f 13th October, 2017 under Section 167 of the Companies Act, 2013. Remuneration Policy:

The Company has devised the Nomination and Remuneration Policy for the selection, appointment and remuneration of the whole time Directors, Key Managerial Personnel and Senior Management Personnel. The extract of Nomination and Remuneration Policy is provided in the Corporate Governance Report and forms part of this Annual Report. Company’s Policy on appointment and remuneration of Directors.

Appointment of Independent Directors.

All Independent Directors of the Company are appointed for a term of 5 years. Accordingly, the Independent Directors viz. Shri Harish N. Motiwalla, Shri Rakesh N. Garodia and Smt. Meghna S. Shah hold office up to 10th February, 2020 and Shri Ramanlal B. Golecha upto 19th November, 2022.

Criteria for appointment of Independent Directors.

The Independent Directors shall be of high integrity with relevant experience and expertise in the fields of manufacturing, marketing, finance, taxation, law, governance and general management, so as to have a diverse Board.

Performance Evaluation.

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Nomination and Remuneration Committee has laid down the criteria for evaluation of the performance of individual Directors, the Board as a whole. Evaluation of performance is undertaken annually. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors at a separately convened meeting at which the performance of the Board as a whole was also evaluated. The performance evaluation of the Independent Directors was carried out by the entire Board (excluding the Director being evaluated). The Company has implemented a system of evaluation on the basis of a structured questionnaire which comprises evaluation criteria taking into consideration various performance related aspects.

The Directors expressed their satisfaction with the evaluation process.

Remuneration of Non-Executive Directors : The Nonexecutive Directors shall be entitled to receive remuneration by way of sitting fees, reimbursement of expenses for participation in Board/Committee meetings and commission, if any, after approval of the members.

10. DIRECTOR’S RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) and 134(5) of the Companies Act, 2013, with respect to Directors’ Responsibility Statement, your Directors to the best of their knowledge hereby confirm that:

a. that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures,

b. that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the Profit of the Company for that year under review;

c. that the Directors have taken proper and sufficient care 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;

d. that the Directors have prepared the accounts for the financial year on going concern basis;

e. the Directors have laid down internal financial controls, which are adequate and were operating effectively;

f. the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively;

11. DISCLOSURES RELATED TO BOARD, COMMITTEES AND POLICIES:

a. BOARD MEETINGS:

The Board of Directors met 5 times during the year on the following dates in accordance with the provisions of the Companies Act, 2013 and rules made thereunder.

May 15, 2017, May 27, 2017, September 14, 2017, and November 20, 2017 and January 30, 2018.

COMMITTEES OF THE BOARD:

The Board has the following Committees:

1. Audit Committee;

2. Nomination and Remuneration Committee;

3. Stakeholders Relationship Committee;

4. Share transfer Committee.

The details of these Committees alongwith their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance Report.

12. EXTRACT OF ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return in Form No. MGT - 9 for the financial year ended 31st March 2018 made under the provisions of Section 92(3) of the Act is attached as Annexure I which forms part of this Report.

13. FIXED DEPOSITS

During the year under review, your Company has not accepted any fixed deposits and there were no unclaimed deposits or interest thereon as on 31st March, 2018.

14. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES:

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to Financial Statements.

15. VIGIL MECHANISMWHISTLE BLOWER POLICY:

The Company has framed a Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The details of the Policy are given in the Corporate Governance Report and the policy is posted on the Company’s website: www.bpml.in.

16. RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were in the ordinary course of business and were on an arm’s length basis. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other related parties which may have a potential conflict with the interest of the Company at large.

All related party transactions for the year are placed before the Audit Committee as well as before the Board for approval. The transactions entered into with related parties are reviewed on a quarterly basis by the Audit Committee.

The policy on Related Party Transactions as approved by the Audit Committee and Board is uploaded on the Company’s website at the link www.bpml.in.

The details of the transactions with Related Parties to be provided in Form AOC-2 is annexed herewith as Annexure-II.

Members can refer to Note No. 39 to the Financial Statements which set out related party disclosures.

17. RISK MANAGEMENT FRAMEWORK:

The Board of Directors of the Company has Risk Management Framework to avoid events, situations or circumstances which may lead to negative consequences on the Company’s businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions.

18. DISCLOSURE UNDER SECTION 67(3) OF THE COMPANIES ACT, 2013:

During the year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is furnished.

19. DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL

During the year under review, there were no orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Company’s operations in future.

20. DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT, 2013:

There were no material changes and commitments which could affect the Company’s financial position have occurred between the end of the financial year of the Company and date of this report.

21. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as required under the provisions of Section134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure - IV which forms part of this Report

22. AUDITORS

The matters related to Auditors and their Reports are as under:

A. OBSERVATIONS OF STATUTORY AUDITORS ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2018:

The observations made by the Statutory Auditors in their report for the financial year ended 31st March 2018 read with the explanatory notes therein are self-explanatory and therefore, do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

Further, there were no adverse remarks or qualifications of reservations in the audit report submitted by auditors.

b. COST AUDITORS:

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with Notifications/Circulars issued by the Ministry of Corporate Affairs from time to time, the Board of Directors have appointed M/s. K. G. Goyal & Associate, Cost Accountants, as a cost auditor of the Company for the Financial Year 2018-19.

The remuneration to be paid to Cost auditors require ratification by the shareholders and accordingly necessary resolution for ratification for seeking approval of members is included in Notice of ensuing AGM.

c. SECRETARIAL AUDITORS.

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. J. H. Fatehchandka & Co., Company Secretaries in Practice to undertake Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure - III.

23. INDUSTRIAL RELATIONS:

Industrial relations with staff and workmen during the year under review continued to be cordial.

24. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:

The Company has formulated and implemented a policy of prevention of sexual harassment at the workplace with mechanism of loading/redressal complaints. During the year under review, there were no complaints reported to the Board.

25. DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT, 2013 AND OTHER DISCLOSURES AS PER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES, 2014:

The information required pursuant to Section 197 of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company will be provided upon request in terms of section 196 of the Act, the Report is being sent to all the shareholders of the Company and other entitled thereto, excluding the information particulars of which is available for inspection by the Members at the Registered office of the Company during business hours on working days of the Company upto the date of the ensuing Annual General Meeting. Members interested in obtaining a copy thereof, may write to the Company Secretary in this regard.

26. INSURANCE

All the properties/assets including buildings, furniture/ fixtures, and insurable interests of the Company are adequately insured.

27. ACKNOWLEDGMENT

Your Directors take this opportunity to thank the Customers, Suppliers, Shareholders, Bankers, Dealers, Agents, Employees and Government and Semi-Government Authorities for their consistent support and encouragement to the Company.

For and on behalf of the Board of Directors

Anurag P. Poddar

Chairman & Managing Director

Date: 16th May 2018.

Place: Mumbai

Source : Dion Global Solutions Limited
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