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Rathi Bars Ltd.

BSE: 532918 | NSE: | Series: NA | ISIN: INE575I01016 | SECTOR: Steel - Medium & Small

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Annual Report

For Year :
2015 2014 2013 2012 2011 2010 2009 2008

Director’s Report

Dear Members, The Directors have pleasure in presenting the Twenty Second Annual Report of your Company together with the Audited Accounts for the year ended March 31st, 2015. 1. FINANCIAL RESULTS: Financial Year Ended 2014-2015 (Rs.) 2013-2014 (Rs.) Gross Revenue 2, 64, 65, 49,254.00 3, 04, 69, 30,367.00 Profit Before Interest, 10, 68, 13,398.00 10, 37, 67,426.00 Depreciation and Tax Less: Interest 3, 71, 21,316.00 4, 45, 83,837.00 Less: Depreciation 5, 98, 41,167.00 2, 61,74,471.00 Profit Before Tax 98, 50,915.00 3, 30, 09,118.00 Less: Provision for Tax 75, 33,309.00 86, 45,437.00 Profit after Tax 23, 17,606.00 2, 43, 63,681.00 Balance of Profit brought 39, 31,27,711.00 36, 87, 64,029.00 forward Balance available for 39, 50, 02,830.00 39,31,27,711.00 appropriation 2. STATE OF COMPANYS'' AFFAIRS AND FUTURE OUTLOOK: The Company has made a profit of Rs. 23, 17,606/- (After Tax) during the year in comparison of Rs. 2, 43, 63,681/- in previous year. There is drastic change in the net profits of the Company which is majorly due to change in the accounting and depreciation policies pursuant to the provisions of the Companies Act, 2013 and market conditions of the economy. But the company is hopeful of improving its positions in the future. Your company is in the business of manufacturing and trading of steel products such as bars, ingots etc and continuously doing its efforts to improve the productivity and revenues of the company in the interest of the stakeholders. 3. DIVIDEND: Your Directors do not recommend any dividend at this stage as the Company requires ploughing back of the profits to the working capital of the Company and expects good results in the coming years. 4. SHARE CAPITAL: The Authorized Capital of the Company is Rs. 18, 00, 00,000/- (Rupees Eighteen Crore only) and the Paid up capital of the Company is Rs. 16, 33, 03,570/- (Rupees Sixteen Crore Thirty Three Lakh Three Thousand Five Hundred Seventy only). There is no change in paid up capital of the Company during the year under review. 5. MATERIAL CHANGES BETWEEN THE DATE OF THE BOARD REPORT AND END OF FINANCIAL YEAR: There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report. 6. CHANGE IN THE NATURE OF BUSINESS: There is no change in the nature of the business of the Company during the financial year 2014-15. 7. TRANSFER TO RESERVES: Your Directors do not propose any amount of transfer to General Reserves for the financial Year ended 31.03.2015. 8. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND: The amount required to be transferred to the Investor Education and Protection Fund in accordance with the provisions of Section 205 A of the Companies Act, 1956 and Rules made thereunder, had been transferred to the Fund and there is no such pending amount required to be transferred. 9. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP): a) Mr. Anurag Rathi has been appointed as Chief Financial Officer of the Company on 13.02.2015. b) In accordance with the provisions of the Companies Act, 2013 and the Company''s Articles of Association, Shri Uddhav Rathi, Director of the Company retire by rotation at the forthcoming Annual General Meeting and being eligible for re- appointment. They have confirmed that they are not disqualified under Section 164 of the Companies Act, 2013 and they are eligible to be re-appointed as Directors of the Company. c) Pursuant to Section 168 of the Companies Act, 2013, Mr. HarKishore Kejriwal, the Independent director of the Company, has resigned from the Company. d) Ms. Parnika Rathi is appointed as the Women Director in the Shareholders meeting (AGM) held on 30.09.2014. 10. SUBSIDIARIES. JOINT VENTURES AND ASSOCIATE COMPANIES: The Company has no Subsidiary, Joint Venture or Associate Company. 11. BOARD EVALUATION: Pursuant to the provisions of Companies Act, 2013 and clause 49 of the Listing Agreement, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholder committee. The manner in which the evaluation has been carried out has been explained in Corporate Governance Report. 12. DISCLOSURE OF RELATIONSHIPS BETWEEN DIRECTORS INTER-SE: Majority of the Directors of the Company are related to each other in accordance with Section 2 (77) of the Companies Act, 2013 and Rule 4 of the Companies (Specification of Definitions Details) Rules, 2014. 13. REMUNERATION POLICY: The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. 14. REMUNERATION RATIO OF THE DIRECTORS/KEY MANAGERIAL PERSONNEL (KMP)/ EMPLOYEES: The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder: S. Name Designatio Remune- Remune- Increase in No. n ration paid ration paid Remuneration FY 2014-15 FY 2013-14 from previous (in lakhs) (in year lakhs) 1. Anurag Director/ 24.00 24.00 ------ Rathi CFO 2. Kamles Mg. ----- ----- ----- h Kumar Director Rathi (KMP) 3. Parnika Director 12.00 ----- ----- Rathi 4. Uddhav Director ----- ----- ------ Rathi S. Name Ratio/Times No. per Median of employee remuneration 1. Anurag 13 times Rathi 2. Kamles h Kumar Rathi 3. Parnika 6 67 times Rathi 4. Uddhav Rathi 15. NUMBER OF BOARD MEETINGS HELD DURING THE YEAR UNDER REVIEW: During the Financial Year 2014-15, the Company held five board meetings of the Board of Directors as per Section 173 of Companies Act, 2013 which is summarized below. The provisions of Companies Act, 2013 were adhered to while considering the time gap between two meetings. S. No. Date of Meeting Board Strength No. of Directors Present 1. 30.05.2014 05 04 2. 13.08.2014 05 04 3. 06.09.2014 05 05 4. 14.11.2014 06 06 5 13.02.2015 06 05 16. OPERATIONAL REVIEW: During the year, your Company had produced 60927.670 MT Steel Bars (Nil Trading Purchase) and 24855.910 MT Ingots/ Billets as against production of 71520.220 MT Steel Bars (Trading Purchase of 99.150 M.T.) and 35439.565 MT ingots/Billets during the corresponding period of last year. 17. DECLARATION BY INDEPENDENT DIRECTORS: Mr. Binod Kumar Maheshwari & Mr. Ashok Kumar Garg are the Independent Directors of the Company. The Board of Directors had received declaration under Section 149(6) of the Companies Act, 2013. 18. CORPORATE SOCIAL RESPONSIBILITY: The Companies Act, 2013 introduced the concept of CSR pursuant to Section 135 while the eligibility criteria doesn''t cover your Company however, the CSR is an integral part of the Company''s activities and the Company carries on Corporate Social Responsibility through Rathi Education Society since inception. 19. VIGIL MECHANISM/WHISTLE BLOWER POLICY: In pursuant to the provisions of Section 177(9) & (10) of the Companies Act, 2013 and in order to ensure that the activities of the company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behavior, the Company has adopted a Vigil Mechanism policy. This policy has been prepared for directors and employees to report their genuine concerns in the interest of the company and its stakeholders. 20. AUDIT COMMITTEE AND ITS COMPOSITION: As per Section 177(2), the composition of Audit Committee as on 31st March, 2015 is as follows: NAME DESIGNATION CATEGORY Ashok Kumar Garg Chairman Independent Director Anurag Rathi Member Executive Director/CFO Binod Kumar Maheshwari Member Independent Director There are no qualifications, reservations or adverse remarks in the Audit Report. 21. AUDITORS: 21.1 STATUTORY AUDITORS:- M/s A. K. Vaish & Co., (Firm Registration No. 506691C) Chartered Accountants, Ghaziabad, who are the statutory auditors of the company, retires at the conclusion of this Annual General Meeting and being eligible, offers themselves for re-appointment. They have confirmed that their re-appointment if made would be in conformity with the limits prescribed under Section 139 of the Companies Act, 2013. 21.2 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 PWR Associates (CP-4717, FcS-5431), Company Secretaries, Delhi to undertake the secretarial audit of the Company. Secretarial Audit Report is annexed herewith as Annexure A. 21.3 INTERNAL AUDITORS: M/s Deepak IP Agrawal & Co., Chartered Accountants, performs the duties of internal auditors of the Company and their report is reviewed by the audit committee from time to time. 22. AUDITOR''S REPORT: The notes to the Accounts referred to the Auditors'' Report are self explanatory, and therefore do not call for any further comments. 23. EXTRACT OF ANNUAL RETURN: In compliance with Section 92(3), Section 134 (3) (A) and Rule 12(1) of the Companies (Management and Administration) Rules, 2014 the extract of the Annual Return have been annexed with this board report in Form MGT-9 as Annexure - B . 24. PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS UNDER SECTION 186: During the year under review, the Company has not advanced any loans or given guarantees but made investments in equity shares and mutual funds of various schemes in order to increase the returns of the Company in the interest of stakeholders out of surplus funds available to the Company from time to time. S. Name of Party Particulars of Nature Purpose for No. Investments which it shall be used 1. HindustanMotors Purchase of Investment Revenue Ltd. Shares generation 2. Jai Prakash Purchase of Investment Revenue Associates Ltd Shares generation 3. IDBI Limited Purchase of Investment Revenue Shares generation 4. Reliance Purchase of Investment Revenue industries Ltd Shares generation 5. Reliance Power Purchase of Investment Revenue Limited Shares generation 6. Mohan Finance Purchase of Investment Revenue Limited Shares generation 7. Ushita Trading Purchase of Investment Revenue Limited Shares generation 8. Nagesh Purchase of Investment Revenue Investment Shares generation Limited 9. Limitex Purchase of Investment Revenue Investment Shares generation Limited 10. Ecowave Purchase of Investment Revenue Infotech Shares generation Limited 11. Twenty First Purchase of Investment Revenue Century (I) Ltd Shares generation 12. Quest Finance Purchase of Investment Revenue Services Limited Shares generation 13. Reliance Money Investment in Investment Revenue Manager Fund- Mutual Funds generation G 14. Birla Sun Life Investment in Investment Revenue Saving Fund-G Mutual Funds generation 15. Birla Sun Life Investment in Investment Revenue Cash Manager Mutual Funds generation Fund-G 16. Franklin India Investment in Investment Revenue Ultra Term Mutual Funds generation Bond-G 17. Axis Treasury Investment in Investment Revenue Advantage Mutual Funds generation Fund-G 18. ICICI Prudential Investment in Investment Revenue Flexi Income Mutual Funds generation Plan-G 19. UTI Treasury Investment in Investment Revenue Advantage Mutual Funds generation Fund-G 20. IDFC Money Investment in Investment Revenue Manager- Mutual Funds generation Tres Plan-G 21. ICICI Investment in Investment Revenue Prudential Top Mutual Funds generation 100 Fund 22. ICICI Prudential Investment in Investment Revenue Value Mutual Funds generation Discovery Fund 23. National Saving Investment in Investment Revenue Certificates National Saving generation Certificate Total Amount S. Name of Party Amount (in Rs.) No. 1. HindustanMotors 6,67,110.41 Ltd. 2. Jai Prakash 12,74,836.89 Associates Ltd 3. IDBI Limited 1,75,066.21 4. Reliance 19,62,633.95 industries Ltd 5. Reliance Power 1,65,082.80 Limited 6. Mohan Finance 16,779.00 Limited 7. Ushita Trading 1,78,965.00 Limited 8. Nagesh 1,12,408.00 Investment Limited 9. Limitex 43,665.00 Investment Limited 10. Ecowave 13,974.00 Infotech Limited 11. Twenty First 39,474.00 Century (I) Ltd 12. Quest Finance 12,657.00 Services Limited 13. Reliance Money 40,00,000.00 Manager Fund- G 14. Birla Sun Life 2,79,04,327.93 Saving Fund-G 15. Birla Sun Life 1,27,00,000.00 Cash Manager Fund-G 16. Franklin India 5,32,06,227.98 Ultra Term Bond-G 17. Axis Treasury 5,13,14,000.00 Advantage Fund-G 18. ICICI Prudential 92,15,298.49 Flexi Income Plan-G 19. UTI Treasury 94,38,000.00 Advantage Fund-G 20. IDFC Money 2,14,04,000.00 Manager- Tres Plan-G 21. ICICI 8,00,000.00 Prudential Top 100 Fund 22. ICICI Prudential 7,00,000.00 Value Discovery Fund 23. National Saving 6,045.00 Certificates Total Amount 19,53,50,552.00 25. INDUSTRIAL RELATIONS: During the year, your Company maintained harmonious and cordial industrial relations. 26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE: During the year under review there has been no such significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Corporation in future. 27. STATUS OF LISTING: The Company''s shares are listed at Bombay Stock Exchange Ltd. The Company has paid the listing fees to the Stock Exchange, Mumbai for the year 2015-2016. The Company''s shares are currently traded in compulsory DMAT Segment in BSE. 28. PUBLIC DEPOSITS: Your Company has not invited or accepted any deposits from the Public during the year and there were no unpaid and unclaimed deposits as on March 31, 2015. Hence, no information is required to be appended to this report in terms of Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank of India Directions, 1998). 29. PARTICULARS OF EMPLOYEES: None of the Employee was drawing remuneration in excess of the limits laid by the Companies Act, 2013 as specified under Rule 5(2) and Rule 5 (3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. 30. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: Information as required under Section 134(3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, our director furnish following information as required. A) CONSERVATION OF ENERGY: The Company is using best technology available for conservation of energy and had taken adequate steps to improve the conservation of energy and this is a continuous process and forms an integral part of responsibilities of departmental heads. Some of the energy conservation steps taken are as follow: i) Optimum Capacity utilization. ii) Optimization of pump and motor operations through standard operating practices. iii) Strict quality checks on inputs thus saving electricity consumption. iv) Minimization of handling losses. v) Total Energy Consumption and Energy Consumption per unit of production is optimum as per industry standards. During the year under review, the Company has consumed 3528.890 MT steam coal, 3, 92, 11,434 units of Electricity. B) TECHNOLOGY ABSORPTION: The Company is using technology, which is best available in the Steel Industry and always step forward to upgrade the same. 31. CORPORATE GOVERNANCE: Your Company has taken adequate steps to adhere to all the stipulations laid down in Clause 49 of the Listing Agreement. A report on Corporate Governance, a Certificate from the Statutory Auditors of the company M/s. A K Vaish & Co., Chartered Accountants confirming the compliance with the conditions of Corporate Governance, a Management Discussion and Analysis Report and Managing Director''s Report are made part of the Annual Report. 32. RELATED PARTY TRANSACTIONS : Related party transactions that were entered during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions with the Company''s Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Transactions with related parties entered by the Company in the normal course of business are periodically placed before the Audit Committee for its omnibus approval and the particulars of contracts entered during the year as per Form AOC-2 is enclosed as Annexure-C None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. 33. DIRECTOR''S RESPONSIBILITY STATEMENT: To the best of their knowledge and belief and according to the informations and explanations obtained by them, your directors make the following statement in terms of Section 134 (3) (c) of the Companies Act, 2013: i) in the preparation of the annual accounts for the Financial Year 2014-15, the applicable accounting standards have been followed along with proper explanations relating to material departures; ii) 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 31st March 2015 and of the Profit & Loss of the Company for that period; iii) 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; iv) the Directors had prepared the annual accounts on a going concern basis; v) the Directors have laid down internal financial controls to be followed in the Company and that such internal financial controls are adequate and were operating effectively; vi) 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. 34. BUSINESS RISK MANAGEMENT: In accordance with clause 49 of the listing agreement the Board Members were informed about risk assessment and minimization procedures after which the Board formally adopted steps for framing, implementing and monitoring the Risk Management Policy for the Company. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on risk related issues. In today''s challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: Regulations, competition, Business risk, Technology obsolescence, Investments, retention of talent and expansion of facilities. Business risk, inter-alia, further includes financial risk, political risk, fidelity risk, legal risk etc. As a matter of policy, these risks are assessed and steps as appropriate are taken to mitigate the same. 35. INTERNAL FINANCIAL CONTROL : The Company has adequate system of internal control to safeguard and protect from loss, unauthorized use or disposition of its assets. All the transactions are properly authorized, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of accounts and reporting financial statements. The internal auditor of the Company checks and verifies the internal control and monitors them in accordance with policy adopted by the Company. 36. ACKNOWLEDGEMENTS: Your Directors take this opportunity to offer their sincere thanks to the various Departments of the Central and State Governments, Bankers to the Company, all customers, dealers, suppliers and contractors for their continuous, valued assistance and support. Your directors also wish to place on record their appreciation for dedicated services rendered by all officers, staff and workers of the company at all levels. By order of the Board of Directors FOR RATHI BARS LIMITED Sd/- Sd/- Place: New Delhi Kamlesh Kumar Rathi Anurag Rathi Date: 01.09.2015 (Managing Director) (Director cum CFO) DIN:00112321 DIN:00063345

Director’s Report