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Shemaroo Entertainment

BSE: 538685|NSE: SHEMAROO|ISIN: INE363M01019|SECTOR: Media & Entertainment
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Download Annual Report PDF Format 2017 | 2016 | 2015
Directors Report Year End : Mar '18    Mar 17

Dear Shareholders,

The Directors take pleasure in submitting their 13th Annual Report on the business and operations of your Company together with the Audited Financial Accounts for the financial year ended March 31, 2018.

1. FINANCIAL RESULTS

(Rs. in Lakhs)

Particulars

Current year 2017-2018

Previous year 2016-2017

Total Income

47,871

41,953

Total expenditure

37,248

32,337

Profit Before Taxation

10,623

9,616

Tax Expenses

3,674

3,421

Profit After Taxation

6,949

6,194

Other Comprehensive Income

41

(21)

Total comprehensive income for the year Less: Appropriations

6,990

6,174

General Reserve

-

-

Final DividendA (including Dividend Distribution Tax)

458

458

Balance carried to the Balance Sheet

30,689

24,198

*Final dividend for the year 2017 Rs.1.40 per equity share of Rs. 10 each.

**Final dividend for the year 2016 Rs. 1.40 per equity share of Rs. 10 each.

The Company has adopted “Ind AS” with effect from April 01, 2017. Financial statements for the year ended and as at March 31, 2017 re-stated to conform to Ind AS. Note 27 to the standalone financial statement provide further explanation on the transition to Ind AS.

2. OVERVIEW OF COMPANY’S FINANCIAL PERFORMANCE

During the year under review, the Standalone Revenue from Operations & Other Income increased to Rs.47,871 Lakhs as against Rs.41,953 Lakhs in the previous year and the Consolidated Revenue from Operations & Other Income increased to Rs. 49,036 Lakhs as compared to Rs. 42,853 Lakhs in the previous year.

Your Company had a standalone growth with a Net Profit after tax of Rs. 6,949 Lakhs as compared to the Net Profit after tax of Rs. 6,194 Lakhs in the previous financial year and a consolidated growth with a Net Profit after tax of Rs. 7,153 Lakhs as compared to the Net Profit after tax of Rs. 6,185 Lakhs in the previous financial year.

There have been no material changes and commitments, 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 this Report.

3. SUBSIDIARIES AND ASSOCIATE COMPANIES

The Company has 5 subsidiaries and 1 associate company as on March 31, 2018. There has been no change in the nature of business of the subsidiaries / associate, during the year under review.

Pursuant to Section 129(3) of the Act, a statement in Form AOC- 1 containing the salient features of the financial positions of the subsidiaries / associate company forms part of this Report.

Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents, and separate audited accounts in respect of subsidiaries, are available Company’s website www.shemarooent.com under Investors section.

During the year ended March 31, 2018, the Company does not have any material subsidiary companies as defined in the SEBI Listing Regulations. The Policy for determining Material Subsidiaries of the Company is available on the Company website at www.shemarooent.com under Investors section.

4. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report is presented in a separate section which forms part of this Report.

5. DIVIDEND

Your Directors recommend payment of Rs.1.55 per fully paid-up equity shares of Rs. 10 each (i.e. 15.50% of the paid-up equity share capital of Company) as final dividend for the financial year 2017-18, for approval of shareholders at the ensuing AGM.

The final dividend on equity shares, if approved by the shareholders would involve a cash outflow on account of Rs.507.92 Lakhs including dividend distribution tax.

6. TRANSFER TO RESERVE

The Company proposes to retain the entire amount of Rs. 6,990 Lakhs in the profit and loss account.

7. PUBLIC DEPOSITS

During the Financial Year under review, your Company has not accepted any deposits within the meaning of Section 73 of the Act read with Companies (Acceptance of Deposits) Rules, 2014.

8. ANNUAL RETURN

Pursuant to the provisions of Section 92 of the Act read with Rule 12 of the Companies (Management and administration) Rules, 2014, the extract of Annual Return in Form MGT 9 is enclosed as Annexure ‘A’ to the Board’s Report.

9. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Particulars of loans, guarantees given and investments made during the year as required under Section 186 of the Act and Schedule V of the SEBI Listing Regulations are provided in Notes 5a & 8c of the Standalone Financial Statements.

10. CREDIT RATING

CARE continued to reaffirm their rating of “CARE A; Stable” and “IND A/S table” respectively, for Long Term Bank Facilities of Rs. 159.95 crore.

11. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS

During the year under review, there were no significant or material orders passed by Regulators / Courts / Tribunals against the Company impacting its going concern status and operations in future.

12. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(5) of the Act, the Board of Directors to the best of their knowledge and ability confirm that:

1. in the preparation of the Annual Accounts for the year ended March 31, 2018, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

2. 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 fair view of the state of affairs of the Company at the year ended March 31, 2018 and of the profit of the Company for that period;

3. 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;

4. the Annual Accounts for the year ended March 31, 2018 have been prepared on a going concern basis;

5. proper internal financial controls to be followed by the Company has been laid down and that such internal controls are adequate and were operating effectively; and

6. proper systems to ensure compliance with the provisions of all applicable laws has been devised and that such systems were adequate and operating effectively.

13. BAORD OF DIRECTORS & KEY MANAGERIAL PERSONNEL

a. Directors

During the year under review, on the recommendation of the Nomination and Remuneration Committee the Board of Directors of the Company at its meeting held on March 20, 2018 appointed Mr. Hiren Gada, a Whole Time Director & CFO as Chief Executive Officer (CEO) and re-designated as CEO & CFO of the Company with effect from March 20,2018.

Mr. Buddhichand Maroo (DIN: 00169319), Director on the Board, is liable to retire by rotation at the 13th Annual General Meeting (AGM) and being eligible, has offered himself for reappointment. His re-appointment is being placed for your approval at the AGM. Your Directors recommend his reappointment as the Non-Executive Director of your Company.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and SEBI Listing Regulations.

b. Key Managerial Personnel

The Key Managerial Personnel of the Company as on date are:

i. Mr. Raman Maroo - Managing Director

ii. Mr. Atul Maru - Jt. Managing Director

iii. Mr. Hiren Gada - CEO & CFO

iv. Mr. Dipesh Gosar - Company Secretary & Compliance Officer

v. Ms. Smita Maroo - Sr. VP - Animation, Kids Digital, L&M

vi. Ms. Kranti Gada - Chief Operating Officer

vii. Ms. Mansi Maroo - Co-producer - Film

viii. Mr. Vinod Karani - EVP - Broadcast Syndication & Acquisition

ix. Mr. Hemant Karani - Sr. VP - Studio

x. Mr. Ketan Maru - Sr. VP - Film Production

xi. Mr. Bipin Dharod - Sr. VP - Physical Sales & Distribution

c. Meetings of Board of Directors:

During the year under review, the Board met 6 times. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report, which forms part of this report.

d. Audit Committee

The Audit Committee comprises of five members. The Chairman of the Committee is an Independent Director. The Committee met five times during the year. The details pertaining to composition of the Audit Committee and terms of reference are included in the Corporate Governance Report, which forms part of this Report.

e. Performance Evaluation of the Board

As per the provision of the Act and Regulation 17 of the SEBI Listing Regulations, the Board has carried out an annual performance evaluation of its own performance and that of its Committees as well as performance of the Directors individually, was carried out internally. The performance evaluation of the Chairman was carried out by the Independent Directors at a separate meeting of the Independent Directors.

Feedback was sought by way of a structured questionnaire, based on criteria approved by the Nomination and Remuneration Committee, for evaluation of performance of Board, Committees of Board and Individual Directors. The outcome of the evaluation was shared with the Nomination and Remuneration Committee, Board and the Directors expressed their satisfaction with the evaluation process.

f. Familiarisation Programme of Independent Directors

The Company undertook familiarization programme for familiarizing Director’s with the Company’s operations and other relevant information which would enable them to take well informed decisions, discharge the responsibilities and functions conferred on them. Details of familiarization programme imparted are placed on Company’s website at www.shemarooent.com under Investors section.

g. Policy on Appointment and Remuneration

In accordance with the provisions of the Act and the SEBI Listing Regulations, the Company has formulated a Policy on Nomination & Remuneration of Directors and Senior Management Employees on the recommendation of Nomination & Remuneration Committee. The main objective of the said policy is to identify person for appointing on the Board and at senior management level of the Company, level and composition of remuneration is reasonable and sufficient to attract, retain and motivate. The details of the Policy are given in the Corporate Governance Report.

14. AUDITORS AND AUDITORS REPORT

a. Statutory Auditors

M/s. M. K. Dandeker & Co., Chartered Accountants (ICAI Firm Registration No. 000679S), were appointed as Statutory Auditors for a term of 5 years at the 11th Annual General Meeting of the Company held on 26th September, 2016, subject to ratification of their appointment at every subsequent Annual General Meeting.

M/s. M. K. Dandeker & Co have expressed their willingness to continue as the Statutory Auditors of the Company and has furnished a certificate of their eligibility and consent under Section 141 of the Act and the rules framed there under. In terms of the SEBI Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the ICAI.

A resolution seeking ratification of their appointment forms part of the notice convening the 13th Annual General Meeting and the same is recommended for your consideration and approval.

The Report given by the Auditors on the financial statements of the Company is part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. Further, Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

b. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Act read with rules framed thereunder, the Company has appointed M/s. Manish Ghia & Associates, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is given as an annexure to this report.

There are no qualifications or reservations or adverse remarks in the Report issued by them for the financial year 2017-18 which may call for any explanation from the Board of Directors.

15. RELATED PARTY CONTRACTS OR ARRANGEMENTS

All Related Party Transactions executed in financial year 2017-18 were on arms’ length basis and in the ordinary course of business. All related party transactions are placed before the Audit Committee for their prior approval and the details of the related party transactions undertaken during a particular quarter are placed at the meeting of the Audit Committee held in the succeeding quarter.

During the year, there were no related party transactions which were materially significant and that could have a potential conflict with the interests of the Company at large. Accordingly, there are no transactions that are required to be reported in Form AOC 2. All related party transactions are mentioned in the notes to the accounts.

The policy on Related Party Transactions as approved by the Board is placed on the company’s website at www.shemarooent.com under Investors section.

16. MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosure with respect to remuneration as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is appended as Annexure ‘B’ to the Board’s Report.

The information as per Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this Report. However, as per Section 136(1) of the Act, the Annual Report and Financial Statements are being sent to the shareholders of the Company excluding the aforesaid information. The said information is available for inspection by shareholders at the Registered Office of the Company during working hours for a period of 21 days before the ensuing Annual General Meeting and shall be made available to any shareholder on request.

17. INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORK

The Company’s Internal Control System are commensurate with nature of its business, size, scale and complexity of its operations. Internal auditing, of the Company, involves the utilisation of a systematic methodology for analysing business processes or organisational problems and recommending solutions to add value and improve the processes. The audit approach verifies compliance with the regulatory, operational and system related procedures and controls. It includes control processes both on manual and IT applications including the ERP application wherein the transactions are approved and recorded. Such controls have been assessed during the year under review taking into consideration the essential components of internal controls.

The Company has also appointed M/s Gawande & Associates, Chartered Accountants, Internal Auditors of the Company. It formulates the audit plan, scope, functioning and methodology, which are reviewed every year, in a manner that they cover all areas of operations. The Audit Committee periodically deliberates on the operations of the Company with the Members of the Management. Reports of the internal auditors are regularly reviewed by the management and corrective action is initiated to strengthen the controls and enhance the effectiveness of the existing systems. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

18. RISK MANAGEMENT

The Company has in place a Risk Management Policy, pursuant to the provisions of Section 134 of the Act and Regulation 17 of the SEBI Listing Regulations. The Company has a robust organisational structure for managing and reporting on risks.

The Senior management periodically reviews the risk management framework to keep updated and address emerging challenges. Risk assessment and management procedures and status are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.

In terms of Regulation 21 of the SEBI Listing Regulations, the Constitution of Risk Management Committee was not applicable during the financial year 2017-2018.

19. WHISTLE BLOWER POLICY / VIGIL MECHANISM

The Vigil Mechanism as envisaged in the Act and the SEBI Listing Regulations is implemented through the Company’s Whistle Blower Policy provides formal vigil mechanism to the Directors and employees to report their concerns about unethical behaviour, actual / suspected fraud or wrongful conduct within the Company. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The details of the Whistle Blower Policy are available on the website of the Company at www.shemarooent.com under Investors section.

20. TRANSFER OF UNCLAIMED DIVIDEND / SHARE APPLICATION MONEY DUE FOR REFUND TO IEPF

Pursuant to applicable provisions of Section 124 and 125 of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, all unpaid or unclaimed dividends are required to be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government, after completion of seven years. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the Members for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority.

Shareholders who have not claimed their dividend warrants or share application money due for refund are requested to immediately send their request for issue of duplicate warrants.

The details of unclaimed dividend / application money as on March 31, 2018 are as follows:

Sr. No.

Particular

Date of declaration

Due date for transfer to IEPF

1.

Unclaimed Final Dividend for FY 2016-2017

27.09.2017

02.11.2024

2.

Unclaimed Final Dividend for FY 2015-2016

26.09.2016

01.11.2023

3.

Unclaimed Final Dividend for FY 2014-2015

21.09.2015

28.10.2022

~4~

Unclaimed Application Money

27.09.2014

27.09.2021

The Company has placed on its website www.shemarooent.com, the information on dividends and application money which remain unclaimed with the Company. The information is also available on the website of the Ministry of Corporate Affairs i.e. www.mca.gov.in.

21. CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under SEBI Listing Regulations. The Report on Corporate Governance, alongwith Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance, as stipulated under the SEBI Listing Regulations is annexed and forms part of this Report.

22. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The information relating to the Conservation of Energy and Technology Absorption required under Rule 8(3)(A) and 8(3)(B) of Companies (Accounts) Rules, 2014 are not applicable to the Company due to the very nature of the industry in which it operates. However we endeavour to support the environment by adopting environment friendly practices in our office premises.

In view of the nature of activities which are being carried on by the Company, the information in connection with technology absorption is Nil.

The particulars regarding foreign exchange earnings and outgo during the year are given in Note 28.2 of the Standalone Financial Statements forming part of this Report.

23. HUMAN RESOURCES

At Shemaroo, we consider our employees as the most valuable resource and ensure strategic alignment of Human Resource practices to business priorities and objectives. The Company takes pride in the commitment, competence and dedication of its employees in all areas of the business. Attracting, developing and retaining the right talent will continue to be a key strategic imperative and the organization continues its undivided attention towards that.

Your Company has well laid down, objective and transparent processes for Recruitment, Selection, Performance Management and Talent Management. To maintain its competitive edge in a highly dynamic industry, it recognizes the importance of having a work force which is consumer-focused, performance-driven and future capable. The Company is committed to nurturing, enhancing and retaining its top talent through superior learning and organizational development.

The total employee strength at the end of financial year 2017-18 is 492.

24. SEXUAL HARASSMENT

The Company has in place policy for the prevention of sexual harassment at workplace in line with the requirements of the Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. During the year under review no complaints were received in regards to sexual harassment.

25. CORPORATE SOCIAL RESPONSIBILITY

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The role of the committee is to review the CSR Policy, indicate activities to be undertaken by the Company towards CSR and formulate a transparent monitoring mechanism to ensure implementation of projects and activities undertaken by the Company towards CSR.

A brief outline of the CSR Policy of the Company, the CSR initiatives undertaken during the financial year 2017-18 together with progress thereon and the report on CSR activities as required by the Companies (Corporate Social Responsibility Policy) Rules, 2014, are set out in Annexure ‘C’ to the Report.

The CSR policy is available on our website at www.shemarooent.com under Investors section.

26. CAUTIONARY STATEMENT

Statements in the Annual Report, particularly those which relate to Management Discussion and Analysis, describing the Company’s objectives, projections, estimates and expectations, may constitute ‘forward looking statements’ within the meaning of applicable laws and regulations. Although the expectations are based on reasonable assumptions, the actual results might differ substantially or materially from those expressed or implied. Important developments that could affect the Company’s operations includes but not limited to changes in exchange rate fluctuations, tax laws, litigation, labour relations, interest costs, political and economic environment.

27. ACKNOWLEDGEMENT

Your Directors take this opportunity to express their sincere appreciation for the support and co-operation extended by the shareholders, customers, bankers, financial institutions, government authorities and other business associates.

The Board of Directors also gratefully acknowledges for the exemplary contribution made by the employees of the Company at all levels. Their dedicated efforts and enthusiasm have been pivotal to your Company’s growth. The Board of Directors would also like to thank all stakeholders for the continued confidence and trust placed by them with the Company. We look forward to continued support of all these partners in progress.

For and on behalf of the Board of Directors

sd/- sd/-

Raman Maroo Atul Maru

Managing Director Jt. Managing Director

DIN:00169152 DIN: 00169264

Mumbai May 15, 2018

Source : Dion Global Solutions Limited
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