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Navneet Education

BSE: 508989|NSE: NAVNETEDUL|ISIN: INE060A01024|SECTOR: Printing & Stationery
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Directors Report Year End : Mar '18    Mar 17

Dear Shareowners,

The Directors present their thirty-second Annual Report along with the Audited Statement of Accounts of the Company for the Financial Year ended 31st March, 2018.

(1) FINANCIAL RESULTS : (Rs. in Lakh)

Particulars

STANDALONE

CONSOLIDATED

2017-18

2016-17

2017-18

2016-17

Revenue From operations

1,13,224

1,08,941

1,20,400

1,17,223

Other Income

2,921

2,392

2,598

2,234

Total Revenue

1,16,145

1,11,333

1,22,998

1,19,457

Expenses

92,699

86,735

1,01,995

93,080

Profit before tax

23,445

24,598

21,003

26,377

Tax Expenses

8,124

8,434

8,253

8,269

Profit After Tax

15,322

16,163

12,750

18,108

Share of Profit / (Loss) of Associate

(14)

(1,047)

Other Comprehensive Income/ (expense) (net of tax)

(470)

(49)

(451)

(62)

Total Comprehensive Income for the year

14,852

16,115

12,285

16,999

(2) DIVIDEND :

Your Directors recommended a dividend of Rs.1.50 (75%) per share for the financial year 2017-18. The dividend so recommended, if declared, works out to about 43.60% (including dividend distribution tax) of Total Comprehensive Income as against your Company’s policy of distribution of a minimum of 28.36% of its net profit.

(3) OPERATIONS :

(i) During the year under review, the Company achieved a total revenue (including other income) of Rs.116,145 Lakh as compared to Rs.111,331 Lakh in the financial year 2016-17.

(ii) Total Comprehensive Income before depreciation and income tax for the year under review stood at Rs.25,057 Lakh as against Rs.27,094 Lakh in the previous year.

(iii) After providing Rs.2,349 Lakh for depreciation, Rs.8,287 Lakh for income tax, Rs.174 Lakh deferred tax Income, Rs.11 Lakh as short provision of tax of earlier years and Deferred tax credit on Other Comprehensive Income of Rs.267 Lakh, Total Comprehensive Income for the year stood at Rs.14,851 Lakh as against Rs.16,115 Lakh achieved in the previous year on standalone basis.

(4) PERFORMANCE OF DIVISIONS :

Content Publishing Division:

The content publishing business achieved a turnover of Rs.62,821 Lakh in the financial year 2017-18 as compared to Rs.59,433 Lakh in the previous financial year. There was a growth of about 5.7% over the last year.

Stationery Division:

Stationery segment improved by 3.08% over the previous year from Rs.48,600 Lakh to Rs.50,096 Lakh.

(5) DIRECTORS’ RESPONSIBILITY STATEMENT :

As required under Section 134(3) (c) of the Companies Act, 2013 your Directors hereby state:

- that in the preparation of annual financial statements for the year ended 31st March, 2018, the applicable Indian Accounting Standards had been followed along with proper explanation relating to material departures, if any;

- that the Directors had 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 at the end of the financial year and of the profit and loss of the Company for that period;

- that the Directors had 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;

- that the Directors had prepared the annual accounts on a going concern basis;

- the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

- The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

(6) DIRECTORS :

Shri Gnanesh D. Gala (DIN: 00093008), Shri Raju H Gala (DIN: 02096613) and Shri Nilesh S. Vikamsey (DIN:00031213) Directors of the Company, retire by rotation and, being eligible offer themselves for reappointment. Your Directors recommend their reappointments.

The five-year term of all the Executive Directors of the Company is expiring on 31st May, 2018. The Board of Directors on the recommendation of Nomination and Remuneration Committee propose to re-appoint them for further period of five years wef 1st June, 2018 and therefore resolutions in this regard form part of the notice convening 32nd AGM for your consideration and approval.

(7) RISK MANAGEMENT POLICY:

During the year under review, the Company has identified and evaluated elements of business risk. Business risk, inter-alia, includes fluctuations in Foreign Exchange, Regulatory Risk, Competition from other players and High Input Costs. The Risk Management Framework defines the risk management approach of the Company and includes periodic review of such risk and also documentation, mitigating controls and reporting mechanism of such risks. The Board of Directors and senior management team currently assess the operations and operating environment to identify potential risks and take necessary action to mitigate the same.

(8) CORPORATE SOCIAL RESPONSIBILITY:

During FY 18, Navneet Group has played a leadership role in fields of healthcare, education, tribal welfare and other areas of public service.

Fight Against Childhood Obesity

In an effort to make a correction in childhood itself to help lead a healthy life throughout one’s lifetime, your Company and Rotary Club of Koregaon Park Charitable Trust have taken the initiative to create awareness amongst school children of the problems associated with obesity and additionally highlighting the mental trauma an obese child undergoes.

A short film was launched in the presence of Honorable Chief Minister of Maharashtra Shri Devendra Fadnavis in August 2017. Over 5,000 students and teachers had taken part in the screening of the film and interactive workshops on ways to mitigate childhood obesity.

Teacher Training

Your Company has taken up the mantle to support progressive educational policies introduced by the Government of Maharashtra. As part of this, The Company conceptualized and administered Training Workshops for teachers of Std. IX & X on activity-based, child-centred learning.

Your Company conducted workshops across Maharashtra and trained 5,000 teachers on activity-based and child-centred teaching.

Animal welfare

Your Company recognizes the right of existence of every animal on this planet. Last year, it supported scores of animal shelters which cater to thousands of animals during summers and times of drought.

Olympic Sports Support

Your Company has partnered with Olympic Gold Quest to groom a promising Table Tennis player, Diya Chitale. Diya won the Silver medal in a team event at the 2018 Czech Junior and Cadet Open Table Tennis Championship. Diya was also the sole Indian to be selected for the prestigious International Table Tennis Federation Rough Diamonds Training Program for Under 15 category held at the Slovenian National Table Tennis Training Centre.

CSR annual report is annexed as Annexure ‘A’ and forms an integral part of this Report.

(9) NOMINATION AND REMUNERATION POLICY:

The Board of Directors has framed a policy which lays down a framework in relation to remuneration to Directors, Managerial Personnel and Senior Management of the Company. The policy lays down the criteria for selection and appointment of Board members. The details of this policy form part of Corporate Governance Report.

(10) MEETINGS :

The details of the number of meetings of the Board held during the Financial Year 2017-18 forms part of the Corporate Governance Report.

(11) INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Your Company has laid down policies, guidelines and procedures that form part of internal control systems, which provides for automatic checks and balances. Your Company has maintained a proper and adequate system of internal controls. This ensures the safeguarding of assets and properties of the Company and protects against unauthorised use and disposal of the assets. Your Company’s internal control systems commensurate with the nature and size of its business operations. Internal Financial Controls are evaluated and internal auditors’ reports are reviewed by the audit committee.

(12) STATEMENT OF DECLARATION BY INDEPENDENT DIRECTORS :

All independent directors have given a declaration that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act, 2013.

(13) RELATED PARTY TRANSACTION:

The Board of Directors has adopted a policy on Related Party Transactions. All related party transactions entered into during the financial year were on arm’s length basis and in the ordinary course of the business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with the interest of the Company at large. All related party transactions were entered into only with prior approval of the Audit Committee. A statement of all related party transaction is presented before the Audit Committee on quarterly basis, specifying the nature, value and terms and conditions of the transaction. Your Company’s Policy on Related Party Transactions, as adopted by your Board is uploaded on the Company’s website. Transactions with related parties, as per requirements of Indian Accounting Standard 24 are disclosed in the notes to accounts accompanying to the financial statements. Since all related party transactions entered into by the Company were in the ordinary course of business and at arm’s length basis, Form AOC- 2 is not applicable to the Company.

(14) PERFORMANCE OF SUBSIDIARIES:

a) eSense Learning Private Limited

The subsidiary was incorporated on 24th April, 2008. The subsidiary is focussed on providing digital education through eLearning solutions to students in India. The revenue of your Company’s subsidiary eSense Learning Private Limited stood at Rs.1,748 Lakh for FY18 as compared to Rs.2,196 Lakh in the previous year. The loss of the company decreased by 23% to Rs.505 Lakh in FY18 as compared to the loss of Rs.669 Lakh in the previous year. The subsidiary company continues its focus on scaling up the quality of revenues with reducing share of hardware revenues and focusing on B2B model for sustainable growth.

b) Indiannica Learning Private Limited

Indiannica Learning Private Limited became wholly owned subsidiary with effect from 30th December, 2016. It was formerly known as Encyclopaedia Britannica (India) Private Limited. The Company focuses on enriching the learning experiences in CBSE/ ICSE curriculum. The revenue of the subsidiary stood at Rs.5,762 Lakh for FY 18 as compared to Rs.7,146 Lakh in the previous year. The Company posted a loss of Rs.1,939 Lakh in FY 18 as compared to a loss of Rs.1,528 Lakh in the previous year. The Losses have increased mainly on account of re-structuring the team which entailed bringing senior leadership team on the board in order to grow the business in the ensuing years.

c) Navneet (HK) Limited

This subsidiary was incorporated in January, 2017. Your Company holds 70% of its paid-up equity share capital. This subsidiary is expected to commence its business activity in FY18-19.

(15) CONSOLIDATED FINANCIAL STATEMENTS:

Your Directors have pleasure in presenting Consolidated Financial Statement which forms part of the Annual Report.

(16) PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of loans, guarantees or investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the note no. 42 to the financial statements.

(17) BOARD EVALUATION:

Pursuant to the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a structured questionnaire was prepared after taking into consideration various aspects of Board’s function, the composition of the Board and its committee, culture, execution and performance of specific duties, obligations and governance.

The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and Non - Independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.

(18) REPORTING OF FRAUDS:

There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and/or Board under Section 143(2) of the Companies Act, 2013 and Rules framed thereunder.

(19) TRANSFER OF SHARES TO IEPF:

As required under Section 124 of the Companies Act, 2013 2,81,312 equity shares in respect of which dividend has not been encashed by the shareholders for seven consecutive years or more, have been transferred by the Company to Investor Education and Protection Fund Authority (IEPF) during the financial year under review. Details of shares transferred have been uploaded on the website of IEPF as well as Company.

(20) WHISTLE BLOWER POLICY:

The Company has a Whistle Blower Policy to report genuine concerns or grievances. The Whistle Blower Policy of the Company has been hosted on Company’s website.

(21) ANNUAL RETURN :

The details forming part of the extract of the Annual Return in the Form MGT-9 as required under Section 92 of the Companies Act, 2013 is included in the report as Annexure ‘B’ and forms part of this report.

(22) SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed CS Sunil M. Dedhia (COP No. 2031), Proprietor of Sunil M. Dedhia & Co., Company Secretary in Practice to undertake Secretarial Audit of the Company.

The Secretarial Audit Report is included as Annexure ‘C’ and forms an integral part of this Report. The said report does not contain any observation or qualification requiring explanation or comments from the Board of Directors as required under Section 134(3) of the Companies Act, 2013.

(23) SUBSIDIARY COMPANY:

The Company does not have any material subsidiary whose net worth exceeds 20% of the consolidated net worth of the Company in the immediately preceding accounting year or has generated 20% of the consolidated income of the company during the previous financial year. A statement containing salient features of the financial statements of the subsidiary company in the prescribed format AOC-1 is included in the report as Annexure ‘D’ and forms part of this Report.

(24) FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The Company has a familiarisation programme for independent directors with regard to their role, rights, responsibilities in the Company, nature of the industry in which the Company operates, the business models of the Company etc. and the same is available on the website of the Company.

(25) CORPORATE GOVERNANCE :

Your Company has complied with Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 of the Stock Exchanges. A report on Corporate Governance as stipulated under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 along with Auditor’s Certificate annexed as Annexure ‘E’ on compliance with the Corporate Governance, forms part of this Report.

(26) TRANSFER TO GENERAL RESERVES :

The Company has not transferred any amount to General Reserves and retained the profits in Retained Earnings.

(27) AUDITORS :

Pursuant to provisions of Section 139 of the Companies Act, 2013 (the Act) read with the Companies (Audit and Auditors) Rules, 2014, M/s N. A. Shah Associates LLP (Firm Registration No. 116560W/W100149), Chartered Accountants were appointed as Statutory Auditors of the Company, to hold office from the conclusion of 31st Annual General Meeting (AGM) until the conclusion of 36th AGM, subject to ratification by shareholders at every subsequent AGM.

Amended provisions of Section 139 of the Act vide Companies (Amendment) Act, 2017 notified from 7th May, 2018 no longer requires ratification of appointment of Auditors by members at every subsequent Annual General Meeting (AGM). In view of this, the appointment of Auditors is not proposed for ratification at ensuing AGM.

M/s N. A. Shah Associates LLP, (Firm Registration No. 116560W/W100149), Chartered Accountants have confirmed that they are not disqualified from continuing as Statutory Auditors of the Company.

(28) COMMENTS ON AUDITORS’ REPORT:

There are no qualifications, reservations or adverse remarks or disclaimer made by the Statutory Auditors in their report requiring explanation or comments from the Board of Directors as required under Section 134(3) of the Companies Act, 2013.

(29) PARTICULARS OF EMPLOYEES:

Disclosure pertaining to remuneration as per Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure ‘F’ to this report. However, as per the provisions of Section 136(1) of the Companies Act, 2013, this Report is sent to the shareholders excluding the said information. Any shareholder interested in obtaining such information may write to the Company Secretary at the Registered Office of the Company.

(30) MANAGEMENT DISCUSSION AND ANALYSIS :

As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Management Discussion and Analysis report form part of this Annual Report.

(31) CREDIT RATING:

During the year under review CRISIL has reassigned CRISIL A1 (pronounced CRISIL A one Plus) rating to the Commercial Paper programme of the Company. The instruments with this rating are considered to have a very strong degree of safety regarding timely payment of financial obligations.

During the year under review CARE Ratings has reaffirmed CARE AA (pronounced CARE Double A Plus) rating to the Long /Short Term Bank facilities of the Company. The bank facilities covered with this rating are considered to have a very strong degree of safety regarding timely payment.

(32) MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENT RELATE AND THE DATE OF REPORT:

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of the report.

(33) SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS :

There are no significant or material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

(34) NUMBER OF CASES FILED AND THEIR DISPOSAL UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013.

The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. The details of the number of complaints pending at the beginning of the financial year, received during the financial year and pending as on end of financial year is as under:

Particulars

Number of Complaints

Number of complaints pending as on the beginning of the financial year

Nil

Number of complaints received during the financial year

Nil

Number of complaints pending as on the end of the financial year

Nil

(35) DEPOSITS:

During the year under review, your Company did not accept any deposits within the meaning of the provisions of Chapter V - Acceptance of Deposits by Companies read with the Companies (Acceptance of Deposits) Rules, 2014.

(36) BUSINESS RESPONSIBILITY REPORT (BRR):

Your Company appeared in the list of top 500 companies based on market capitalization criteria as on 31st March, 2017 and therefore required to prepare and attach Business Responsibility Report (BRR) to the Annual Report of the Company for the Financial Year 2017-18.

The BRR of the Company for the year ended 31st March, 2018, in line with Green initiative, is made available on the website of the Company www.navneet.com and forms part of the Annual Report. The BRR is kept at the Registered Office of the Company for its inspection. A copy of the BRR shall be made available to such of those shareholders who are desirous and interested, upon receipt of a written request from them.

(37) DETAILS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO :

(A) CONSERVATION OF ENERGY

Company’s plant was designed to achieve high efficiency in the utilisation of energy. The key areas with regards to reduction of energy are identified and constant efforts are made towards energy conservation.

(B) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

Research & Development

(1) Efforts in brief towards technology absorption, adaptation & innovation

Through visits of technical personnel to developed Western countries, your Company keeps abreast with the Advanced Technology Development and through specific programmes introduces, adopts and absorbs these sophisticated technologies.

(2) Benefits derived as a result of the above efforts

In view of the above, your Company has been able to achieve a higher production, accuracy and perfection in printing.

(38) ACKNOWLEDGEMENT :

Your Directors take this opportunity to thank Company’s shareholders, bankers, financial institutions, customers, suppliers, Central and State Governments, other regulatory authorities and all the employees for their support and co-operation extended to the Company during the year under review.

For and on behalf of the Board of Directors

sd/-

Kamlesh S. Vikamsey

Place : Mumbai Chairman

Date : 10th May, 2018

Source : Dion Global Solutions Limited
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