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Refex Industries

BSE: 532884|NSE: REFEX|ISIN: INE056I01017|SECTOR: Chemicals
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Directors Report Year End : Mar '18    Mar 15

To the Members,

The Directors have great pleasure in presenting the Sixteenth Annual Report of your Company together with the Audited Statement of Accounts for the year ended March 31,2018.

FINANCIAL PERFORMANCE

The key financial parameters for the period under review are as follows.

(Rs. In Lakhs)

Description

Standalone Results

Consolidated Result

2017-18

2016-17

2017-18

2016-17

Turnover

7685.83

3771.82

7685.83

3771.82

Other Income

204.12

168.97

204.12

168.97

Total Income

7889.95

3940.79

7889.95

3940.79

Expenditure (other than Tax)

7716.12

3887.47

7716.64

3888.16

Exceptional Items

-

-

-

-

Profit before tax

173.83

53.32

173.31

52.63

Provision for Income Tax

-

-

-

-

Provision for deferred tax

(79.56)

7.01

(79.56)

7.01

Profit after Income Tax

94.27

46.31

93.75

45.62

Earnings Per Share (in Rs.)

0.61

0.30

0.61

0.29

During the year under review the Company achieved a turnover of Rs. 7685.83 Lakhs as against the previous year figure Rs. 3771.82 Lakhs showing an increase in the turnover by 104%. In addition earnings from other income increased by Rs.35.15 Lakhs. As a result the Company made a net profit of Rs. 94.27 Lakhs. Consequently the net worth of the Company increased by the amount of profit made during the year and stands at Rs. 1114.13 Lakhs.

DIVIDEND

In order to conserve the resources of the Company your Board has not recommended any dividend for the year ended under review and has transferred the entire amount of profit to the General Reserves.

COMMITTEES OFTHE BOARD:

The details of the Board’s Committees - The Audit Committee, The Nomination & Remuneration Committee and The Stakeholders’ Relationship Committee have been disclosed separately in the Corporate Governance Report which is annexed to and forms part of this Annual Report.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS:

No material changes and commitments have occurred after the close of the year till the date of this report which affects the financial position of the Company.

CHANGE IN THE NATURE OF BUSINESS, IF ANY:

There are no changes in the nature of business of the Company during the financial year under review. BOARD MEETINGS:

The Board during the Financial Year 2017- 2018 met four times i.e. 26.05.2017, 31.08.2017, 13.12.2017 and 14.02.2018.

DIRECTORS AND KEY MANANGERIAL PERSONNEL:

As per Article 35 of the Articles of Association of the Company, Shri. T. Anil Jain, Director retires by rotation in the forthcoming Annual General Meeting and being eligible offers himself for reappointment. The Board has recommended his re-election. A resolution is proposed for his reappointment in the notice.

The board of Directors at its meeting held on February 14th 2018 appointed Mrs. Jamuna Ravikumar, as an additional director of the company to hold office upto the date of the forth coming AGM of the company. In according with the section 149 and other applicable provisions of the companies act, 2013. Mrs. Jamuna Ravikumar is seeking appointment as independent Director for a term of 3 consecutive years upto the conclusion of 19th AGM to be held in the year 2021 for which a resolution is in place vide SI. No. 3 of the Notice.

The Independent Directors of the Company has submitted a declaration under Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Sectionl 49(6) of the Act and there has been no changes in the circumstances which may affect their status as Independent Director during the year.

During the year, the Non-Executive Director of the Company had no pecuniary relationship or transaction with the Company, other than setting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company are Mr. T. Anil Jain , Managing Director, Mrs. Uthayakumar Lalitha, Chief Financial Officer and Mr. Gopalakrishnan Srinivasan, Company Secretary. There has been no change in the Key Managerial Personnel during the year.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS:

The Company has received necessary declaration from all the Independent Directors i.e., Sri. D. Hem Senthil Raj and Smt. Jamuna Ravikumar under Section 149(7) of the Companies Act, 2013.

The said Independent Directors of the Company meet the criteria of their Independence as laid down under Section 149(6) of the Companies Act, 2013.

DIRECTOR’S RESPONSIBILITY STATEMENT:

In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) 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 of the Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors had prepared the annual accounts on a going concern basis; and

(e) 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.

(f) 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.

CONSOLIDATED FINANCIAL STATEMENTS

Your Directors have pleasure in enclosing the consolidated Financial Statements in addition to the standalone financial statements pursuant to Section 129 (3) of the Companies Act, 2013 (Act) and SEBI Listing Regulations and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard.

INFORMATION ABOUT THE FINANCIAL PERFORMANCE / FINANCIAL POSITION OF THE SUBSIDIARIES

M/s. Vituza Solar Energy Limited continues to be the wholly owned subsidiary of your Company. The necessary AOC -1 as required under Sub Section (3) of Section 129 of the Companies Act, 2013 read with rule 5 of Companies (Accounts) Rules, 2014 is annexed to the Directors’ Report as Annexure No 4

EXTRACT OF ANNUAL RETURN:

Pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an Extract of Annual Return in Form MGT9 is annexed to this Report. (Annexure 1)

AUDITORS

M. Krishnakumar & Associates Chartered Accountant (Membership No 203929) was appointed as statutory auditor of your Company in the AGM held on 26th September 2017 for a term of three consecutive years. As per the provisions of section 133 of the Companies Act 2013 the appointment of Auditors is required to be ratified by members at every AGM.

In accordance with the Companies Amendment Act 2017 enforced on 7th May 2018 by the Ministry of Corporate Affairs, the appointment of statutory auditors is not required to be ratified at every AGM.

The notes in the Financial statement referred to in the auditor report are self-explanatory and do not call for any further comments.

The reply to qualification in auditor’s report is given below.

Provisions for Liability towards Gratuity

SI. No Auditors Qualification

Management Reply

The Company is not providing for liability

Provision towards Gratuity for the year

for gratuity as per actuarial valuation,

has not been made and the Board is of

which is not in accordance of the

the Opinion that the same will not

Accounting Standard on Provision for

affect the result of the Company

Gratuity (AS-15) (Refer Note 2 (i) forming

significantly.

part of the Financial Statements)

issued by The Institute of Chartered

Accountants of India and the impact of

which is unascertainable.

SECRETARIAL AUDIT:

In accordance with 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 Mr. R. Muthukrishnan, (FCS 6775) Practicing Company Secretary, Chennai, to undertake the Secretarial Audit ofthe Company. The Secretarial Audit report is annexed herewith as ‘Annexure 2’.

Reply to the observation of Secretarial Auditor’s Report:

1. As regards delayed filing of forms with ROC as required under the Companies Act 2013 the company shall ensure that such delays do not recur.

2. As regard the amount advanced to an entity in which a Director is Interested, the Board is of the opinion that it is in nature of advance for a proposed commercial transaction and shall not fall under the purview of Section 185 of the Act.

3. In view of the aforesaid explanations, the Board is of the opinion that the said amount is in the nature of advances and Section 186 ofthe Companies Act 2013 shall not apply.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:

(A) Conservation of energy & Technology absorption:

The Company does not engage in manufacturing activity involving energy intensive processes. However, the Company has taken sufficient steps towards general energy saving techniques and conservation.

Given the Nature of Process employed by the Company, there is no technology absorption involved.

(B) Foreign Exchange Earnings and Outgo:

Foreign Exchange Earnings = INR 1,07,32,321 Foreign Exchange Outgo = INR 9,62,80,961

PUBLIC DEPOSITS:

The Company did not invite or accept any deposits from the Public under Sec 73 of the Companies Act 2013 read with Companies (Acceptance of Deposits) Rules, 2014.

SIGNIFICANT & MATERIAL ORDERS PASSED BYTHE REGULATORS: NIL

INTERNAL FINANCIAL CONTROLS

The Company has appointed an Internal Auditor, a Chartered Accountant, to ensure the effective functioning of internal financial controls and check whether the financial transaction flow in the organization is being done based on the approved policies of the Company. The Management based on the internal audit observations gives their comments. Further, the Board of Directors of the Company have adopted various policies like Related Party Transactions Policy, Vigil Mechanism, Material Subsidiary Policy for ensuring the orderly and efficient conduct of its business, for safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

Pursuant to the provisions of Section 177 (9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI Listing Regulations, the Board of Directors had approved the Policy on Vigil Mechanism/Whistle Blower and the same was hosted on the website of the Company.

This Policy inter-alia provides a direct access to the Chairman of the Audit Committee.

Your Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee and that no complaints were received during the year.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the Standalone Financial Statement (Please refer to Notes 28.1.b under Note to the Standalone Financial Statement).

RISK MANAGEMENT POLICY:

The Company has a Risk Management Committee in place although it is not applicable to it both under the SEBI LODR Regulations 2015 and the Companies Act, 2013. However, the Company has an adequate Risk Management Policy commensurate with its size and operation. Risk Management includes identifying types of risk and its assessment, risk handling, monitoring and reporting.

CORPORATE SOCIAL RESPONSIBILITY POLICY

At Refex, Corporate Social Responsibility has been integral part of the business since it’s inception. Refex believes in making a difference to the lives of millions of people who are under privileged. It promotes Social and Economic inclusion by ensuring that marginalised communities have equal access to health care services, educational opportunities and proper civic infrastructures. Corporate Social responsibility is embedded in the Refex ethos going hand in hand with the core business of the Company.

During the year the Company has voluntarily made the following contributions as a measure to fulfill the obligations of Corporate Social Responsibility

1. A sum of Rs 3,78,540/- was paid to the Stella Maris college for the purpose of providing financial assistance to few under privileged students of the college in order to pursue their education.

2. A sum of Rs 1,00,000/- was paid to JITO Chennai chapter as Donation for Gujarat & Rajasthan flood relief.

RELATED PARTY TRANSACTIONS:

All transactions entered into by the Company with its related parties during the year were in ordinary course of business and on an arm’s length basis and did not attract the provisions of Section 188 of the Companies Act, 2013. During the year, the Company had not entered into any arrangement / transaction with related parties which could be considered material in accordance with the Company’s Policy on Related Party Transactions and accordingly, the disclosure of Related Party Transactions in Form AOC 2 is not applicable. However, names of Related Parties and details of transactions with them have been included in Note no. 26.1 .b to the financial statements provided in the Annual Report.

DISCLOSURE ABOUT COST AUDIT:

As per Companies (Cost Records and Audit) Amendments Rules, 2014 dated 31st December, 2014 issued by the Ministry of Corporate Affairs, the Company is not subjected to Cost Audit.

PARTICULARS OF EMPLOYEES:

Disclosure pertaining to the remuneration and other details as required under Section 197(12) of the Act, the Rules framed there under is given in Annexure-3 to the Board Report as well as under Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT 2013

The Company has been employing Women employees within the premises. The Company has in place an Anti-Harassment Policy in line with the requirements of the Sexual Harassment of Women at work place (Prevention, Prohibition and Redressal) Act 2013. Internal Complaint Committee has been set up to redress complaints received regularly. There was no complaint received from any Women employee during the financial year 2017-18 and hence no complaint is outstanding as on 31.03.2018 for redressal.

LISTING WITH STOCK EXCHANGES:

The Equity Shares of the Company are listed on the following Stock Exchanges:

i. BSE Limited (BSE)

No. 25th Floor, P.J. Towers, Dalai Street, Fort, Mumbai- 400 001.

ii. National Stock Exchange of India Limited (NSE)

Exchange Plaza, BandraKurla Complex, Bandra East, Mumbai- 400 051.

The Stock Codes allotted by these Stock Exchanges are as under:

The Company has paid listing fees to the stock exchanges for the year 2017-18 CORPORATE GOVERNANCE

A detailed report on Corporate Governance pursuant to Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the BSE and NSE along with the Auditors’ certificate on Compliance with the mandatory provisions on Corporate Governance is given as a separate statement in the Annual Report.

The Managing Director has issued necessary certificate to the Board in terms of Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations , 2015 for the Financial Year ended 31 March 2018.

PERFORMANCE EVALUATION OFTHE BOARD, ITS COMMITTEES AND DIRECTORS

Pursuant to the provisions of the Companies Act of 2013 and Regulationl 9 of SEBI (Listing Obligation and Disclosure Requirement), Regulation 2015 (“ The Listing Regulation “) the Board has carried out the annual performance evaluation of it’s own performance, the Directors individually as well as the evaluation of various Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors covering the various aspects of the Board’s functioning such as adequacy of the composition of the Board and the Committees, Board’s culture execution and performance of such duties , obligations of independence, governance , ethics and values adhering to corporate governance norms , inter personal relationships , attendance and contribution at meetings etc.

A separate exercise was carried out to evaluate the performance of individual Directors, including the chairperson ofthe Board who were evaluated on parameters such as participation and contribution , commitment including guidance provided to the senior management outside the Board , and Committee meetings , effective deployment of knowledge and expertise , effective management of relationship with various stake holders independence of behaviour and judgement etc. The Performance evaluations of Independent Directors were carried out by the entire Board. The performance evaluation of the Chairperson and Managing Director was carried out by the independent Directors . The Board reviews the evaluation results as collated by Nomination and Remuneration Committee.

MEETING OF THE INDEPENDENT DIRECTORS

The Independent Director of your Company met once during the year without the presence of NonIndependent Director and the members of the Management. The meeting was conducted in an informal and Flexible manner to unable the Independent Directors to Inter alia discuss matters pertaining to review of performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairperson of the Company after taking into account the views of the executive and Non- Executive Directors assess the quality, quantity and timeliness of the flow of the information between Company Management and the Board that as necessitated the Board to effectively and reasonably perform their duties.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report pursuant to Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the BSE and NSE for the year under review is given as a separate statement in the Annual Report.

INSURANCE

The assets of the Company are adequately insured.

INDUSTRIAL RELATIONS

Your Company s’ Industrial relations continues to be harmonious and cordial. ACKNOWLEDGEMENTS:

Your Directors gratefully acknowledge the excellent support and co - operation extended by all the stakeholders more particularly Bankers, Shareholders, Customers, dealers, regulatory and govt, authorities.

Your Directors also wish to place on record their appreciation of the contribution made by the members of the management team and the employees across all levels for the good work put in, during the year under review.

For and on behalf of the Board

Place: Chennai

Date: 25.05.2018 T. Anil Jain

Managing Director

DIN:00181960

Source : Dion Global Solutions Limited
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