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Sysco Industries

BSE: 539842|ISIN: INE410U01011|SECTOR: Packaging
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Download Annual Report PDF Format 2017 | 2016
Directors Report Year End : Mar '16   

To, The Members,

SYSCO INDUSTRIES LIMITED.

Dear Shareholders,

The directors have pleasure in presenting herewith the 07thAudited Annual Report for the year ended on 31st March, 2016 of your Company.

FINANCIAL RESULTS

The Financial performance of the company during the year is as under:

PARTICULARS

FOR THE YEAR ENDED ON 31/03/2016 (Rs. In Lakhs)

FOR THE YEAR ENDED ON 31/03/2015 (Rs. In Lakhs)

Income From Sales(Net)

11041.99

7599.04

Other Income

9.94

11.42

Total Income.

11051.93

7610.46

Total Expenses

9868.48

6678.76

Profit / Loss from ordinary activities before finance cost, depreciation and exceptional item

1183.45

931.7

Depreciation

182.17

184.78

Finance Cost

524.88

366.40

Profit / Loss from ordinary activities before exceptional item

476.40

380.52

Exceptional Items

-

-

Profit / Loss Before Tax

476.40

380.52

Tax Expenses

137.08

41.92

Net Profit / Loss after Tax

339.32

338.60

Earnings per share (before and after extraordinary items -

(a) Basic

5.87

9.91

(b) Diluted

5.87

9.91

OPERATIONAL OVERVIEW

The company has engaged in business of manufacturing. During the year the company has earned total income of Rs. 11051.93 (Previous year Rs. 7610.46) and total expenses of Rs. 10050.66 (Previous year of Rs. 6863.55). After all the financial adjustments, the company has earned a net profit after tax of Rs. 339.32 (Previous year Rs. 338.60).

DIVIDEND

The Board does not recommend any dividend for the year under review.

RESERVES

The amount of profit is transferred to the Reserve and Surplus Account.

PERFORMANCE

The company has accumulated profits at the end of the Financial Year. In order to improve the performance further, the Company continues its focus on cost efficiencies, improving product quality and developing capabilities for servicing the stringent requirements of customers.

DETAILS OF THE ASSOCIATES/ JOINT VENTURE / SUBSIDIARIES COMAPANIES

The company does not have holding or subsidiary companies during the year and no other company has become holding / subsidiary/ joint venture.

SHARE CAPITAL STRUCTURE

During the year under review there were changes in the Authorized, Issued, Subscribed and Paid up Share Capital Structure of the Company. The Authorized Share Capital of the Company was increased to Rs. 8.5 Crores from Rs. 4 Crores in 2015-16. The issued, subscribed and paid up capital as on 31st March 2016 increased from Rs. 38,558,000 in 2014-15 to Rs. 57,837,000 in 2016-17 due to issue of bonus share for Rs. 19,279,000 in the ratio of 2:1. The Company in the same year became Public Limited w.e.f. 22-01-2016 and initiated IPO.The IPO was open for subscription on March 31 to April 5, 2016. The Company got listed on the Bombay Stock Exchange (SME Platform) w.e.f. 13-04-2016.

MEETINGS OF THE BOARD

The Board met Nine times during the financial year. Details of meetings are given in the Corporate Governance Report annexed herewith and forms part of this report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

PUBLIC DEPOSIT

The Company has not accepted any public deposit during the year under review and no amount against the same was outstanding at the end of the year.

REGULATORY STATEMENT

In conformity with provision of regulation 34(2)(c) & 53(b) of SEBI (LODR), Regulations 2015, the Cash Flow Statement for the year ended 31.03.2016 is annexed hereto. The equity shares of the Company are listed on the BSE Ltd.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declarations from each Independent Director of the Company confirming that he/she met with the criteria of independence as laid out in sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 16(1)(B) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,

2015.

BOARD DIVERSITY

A diverse Board enables efficient functioning through differences in perspective and skill, and also fosters differentiated thought processes at the back of varied industrial and management expertise, gender, knowledge and geographical background. The Company follows diverse Board structure.

BOARD EVALUATION

As per the provisions of the Companies Act, 2013 and SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015, the formal annual evaluation was carried out for the Board''s own performance, its committee & Individual directors. The manner and detail in which evaluation was carried out is stated in the Corporate Governance Report which is annexed and forms a part of this report.

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

As required under Section 134 (3) (m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014, particulars relating to conservation of Energy, R & D, Technology absorption and foreign Exchange earnings / outgo are separately provided in the annexure to this report as Annexure - 1.

DEMATERIALISATION OF SECURITIES:

Your Company''s Equity shares are admitted in the System of Dematerialization by both the Depositories namely NSDL and CDSL. The Company has signed tripartite Agreement through Registrar and Share Transfer Agent M/s Big share Services Pvt. Ltd. The Investors are advised to take advantage of timely dematerialization of their securities. The ISIN allotted to your Company is INE410U01011. Total Share dematerialized up to 31st March 2016 were 5358900 which constitute 92.66% of total capital. Your Directors request all the shareholders to dematerialize their shareholding in the company as early as possible.

SAFETY AND ENVIRONMENT

Safety and occupational health responsibilities are integral to your Company''s business process and these are laid down in the Company''s Safety and Health Policy, standards and working procedures. Safety is a key performance indicator and your Company is committed to ensuring zero harm to its employees, to any person in the Company premises and to the community. The Company is continuously focusing on improved training, new initiatives and communications enhancing safety in the work place.

Apart from safety initiatives, your Company is also focusing on environment protection policy.

DIRECTORS

Mr. Sidharth Bharatbhushan Jain shall retire by rotation at the ensuing Annual General Meeting as per provisions of Law. He is eligible for reappointment and has offered himself for directorship of the company. Your directors recommend for his reappointment.

INDEPENDENT DIRECTORS DECLARATION

In compliance with Section 149(7) of the Act all Independent Directors have given declaration that they meet the criteria of independence as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 [SEBI Regulation, 2015].

DIRECTORS'' RESPONSIBILITY STATEMENT:

In terms of section 134 Clause (C) of Sub-Section (3) of the Companies Act, 2013, in relation to financial statements for the year 2015-16, the Board of Directors state:

a) In the preparation of the annual accounts for the financial year ended 31st March 2016 as far as possible and to the extent, if any, accounting standards mentioned by the auditors in their report as not complied with, all other applicable accounting standards have been followed along with proper explanation relating to material departure;

b) 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 true and fair view of the state of affairs of the Company at the end of the financial year and profit and loss account of the Company for that period;

c) The Directors have 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 have prepared the annual accounts on a going concern basis; and

e) The directors in the case of a listed company 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 have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

In compliance with Section 178 (1) as also in compliance with the Listing Regulations, the Board of Directors do hereby declare that:

a) The Company has proper constitution of the Board of Directors including independent directors in proportion as per requirement of the Listing Regulations. However, the Company is still in process for appointing a suitable person as woman director as required under Section 149 of the Companies Act, 2013.

b) The Company has constituted Nomination and Remuneration Committee, Stakeholders Relationship Committee, Audit Committee as per requirements of the Clause 49 of the Listing Agreement and provisions of the Companies Act 2013.

c) The Company has the policy for selection and appointment of independent directors who are persons of reputation in the society, have adequate educational qualification, sufficient business experience and have integrity & loyalty towards their duties.

d) The Company pays managerial remuneration to its Managing/Whole Time Directors based upon their qualification, experience and past remuneration received by them from their previous employers and company''s financial position.

e) The Independent Directors are paid sitting fee for attending sitting fees for attending Board and other committee meetings as decided by the Board from time to time. This sitting fee is decided considering the financial position of the company.

f) The Company is not paying any commission on net profits to any directors.

g) During the year the Board has met 4 times during the year. The details of presence of every director at each meeting of the Board including the meetings of the Committees, if any, are given in the reports of the Corporate Governance.

SYSTEM OF PERFORMANCE EVALUATION OF THE BOARD, INDEPENDENT DIRECTORS AND COMMITTEES AND INDIVIDUAL DIRECTORS

1. The Board makes evaluation of the effectiveness and efficiency of every individual directors, committee of directors, independent directors and board as a whole.

2. For these purpose the Board makes evaluation twice in a year on a half yearly basis.

3. The performance of individual directors are evaluated by the entire Board, excluding the Director being evaluated on the basis of presence of every directors at a meeting, effective participation in discussion of each of the business of agenda for the meetings, feedback receives from every directors on draft of the minutes and follow up for action taken reports from first line management.

4. Effectiveness and performance of various committees are evaluated on the basis of the scope of work assign to each of the committees the action taken by the committees are reviews and evaluated on the basis of minutes and agenda papers for each of the committee meetings.

5. The performance of independent directors are evaluated on the basis of their participation at the meetings and post meeting follow up and communication from each of such independent directors.

DISCLOUSER AS PER COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULE, 2014.

1. The ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year:

Total Remuneration expenses : Rs. 29,762,721

Directors'' Remuneration Expenses: Rs. 8,890,000

Other employees Remuneration: Rs. 20,872,721

Directors'' Name

Directors'' Remuneration

Ratio

Bharatbhushan Jain

28,30,000

12.20

Sourabh B. Jain

28,30,000

12.20

Sidharth B. Jain

28,30,000

12.20

Sameer Banerjee

4,00,000

1.72

2. The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any in the financial year:

Names

Designation

% increase

Bharatbhushan Jain

Director

72 %

Sourabh B. Jain

Director

72 %

Sidharth B. Jain

Director

72 %

Sameer Banerjee

Director

-

Mahadeb Roy

CFO

-

Ronak Ladhawala

CS

-

3. The percentage increase in the median remuneration of employees in the financial year There was no increase in remuneration of any employees during the financial year.

4. The number of permanent employees on the rolls of company: 90

5. Average percentile increase made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration ;

There was no increase in remuneration of any employees during the financial year.

6. The key parameters for any variable component of remuneration availed by the directors: None

7. The Company affirms remuneration is as per the remuneration policy of the Company.

PARTICULARS OF THE EMPLOYEES

Particulars of the employees as required under provisions of Section 197 (12) of the Act read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are not attached with this report since there was no employee who was in receipt of remuneration in excess of Rs.8.5 Lakhs per month during the year or Rs. 1.2 Crores per annum in the aggregate if employed part of the year.

DETAILS OF RELATED PARTIES TRANSACTIONS PURUSANT TO SECTION 188(1) OF THE COMPANIES ACT, 2013

The Company is not entering into related parties transactions for sale/purchase of goods or services at preferential prices. However, all the transactions in the nature of sales/purchase of goods or services are made on arm''s le ngth basis. The same were reported to the Board at every meeting and Board took a note of the same and approved. Other details for inter corporate financial transactions or remuneration and other benefits paid to directors, their relatives, key managerial personnel etc. are given as per requirements of AS 18.

Pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 information pertaining to related parties are given in Form AOC-2below Annexure 1.

DETAILS OF LOANS, GUARANTEES AND INVESTMENTS U/S 186 OF THE COMPANIES ACT, 2013

During the year under review the Company has not made any inter corporate loans, investments, given any corporate guarantee to any other body corporate, subsidiary, associate or any other company.

AUDITORS

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with rules made thereunder, the Board of Directors has appointed M/s Kamlesh Shah & Co., Practicing Company Secretaries, as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial Year 2015-16. The report submitted by the Secretarial Auditor in Form MR-3 is attached to this report as Annexure - 4. The remark of secretarial auditor is self explanatory in nature.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

(Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 for the year ended March 31, 2016)

A. CONSERVATION OF ENERGY

(a) Energy conservation measures taken:-

Your company gives priority to Energy conservation. It regularly reviews measures to be taken for Energy Conservation/Consumption and its effective utilization.

(b) Additional investments and proposals, if any, being implemented for reduction of consumption of energy:-

Your Company is highly power intensive industry and power is the basic requirements of manufacturing process.

(c) Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on the cost of production of goods: - None

(d) Total energy consumption and energy consumption per unit of production:

B. TECHNOLOGY ABSORPTION (I) Research and Development (R & D)

Particulars

2014-15

2015-16

1. Specific areas in which R&D carried out by the company.

Nil

Nil

2. Benefits derived as a result of the above R&D

3. Future plan of action:

Nil

Nil

a. Capital

b. Recurring

Nil

Nil

c. Total

Nil

Nil

d. Total R&D expenditure as a percentage of total turnover

Nil

Nil

NIl

Nil

(II) Technology absorption, adaptation:

Particulars

2014-15

2015-16

Company has not carried out research, development & innovation activities.

1. Efforts, in brief, made towards technology absorption, adaptation and innovation.

Nil

Nil

2. Benefits derived as a result of the above efforts, e.g. product

Nil

Nil

improvement, cost reduction, product development, import

substitution etc.

3. In case of imported technology

(imported during the last 5 years reckoned from the

Nil

Nil

beginning of the financial year), following information may

be furnished:

a. Technology imported

b. Year of import

c. Has technology has been fully absorbed

d. If not fully absorbed, areas where this has not taken

place, reasons therefore and future plans of action.

STATUTORY AUDITORS

M/s. Adukia & Company, Chartered Accountants, an Auditors firm are statutory auditors of the company since 2014-15. As per Rule 6(3) of the Companies (Audit and Auditors) Rules 2014, they are eligible to continue as the statutory auditors of the company for financial years 2014-15, 2015-16, 2016-17, 2017-18 and 2018-19. Necessary Resolution for ratification of their appointment as the Statutory Auditors and fixing their remuneration is proposed to be passed at the Annual General Meeting.

EXTRACT OF ANNUAL RETURN

In compliance with Section 134(3)(a) of the Act, an extract of Annual Return in the prescribed format is appended to this report as Annexure 2.

MANAGEMENT DISCUSSION AND ANALYSIS

Management''s discussion and perceptions on existing business, future outlook of the industry, future expansion and diversification plans of the Company and future course of action for the development of the Company are fully explained in a separately in Corporate Governance Report.

On Behalf of the Board of Directors

Date: 13th August,2016 Sysco Industries Limited

Place: Surat Sd/-

(Bharatbhushan Jain)

Chairman & Whole time director

(DIN: 06908960)

Source : Dion Global Solutions Limited
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