Directors' Report Dear Members, 1. Your Directors hereby present their Twenty Sixth Annual Report on the operations of the Company together with the Audited Accounts for the financial year ended 31st March, 2015. 2. RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS: During the year under review, your Company has registered a total loss of Rs. 3,784.46 Lacs. Due to various operational issues, the Company was unable to earn profits. Your directors are hopeful for the bright future of the Company in the years to come. During the year under review, turnover of your Company is Rs. 44,898.48 Lacs as compared to the turnover of Rs. 53,635.38 Lacs in the previous year. Due to adverse market conditions and global recession, the net loss during the year under review is Rs. 3784.46 Lacs compared to the net Profit of Rs. 232.91 Lacs in the previous year. Your Company is relentlessly putting all its efforts to reduce the cost and improve the operating margins and is trying its level best to improve the numbers in coming future. 3. DIVIDEND: In view of accumulated losses, your directors are unable to declare any dividend for the year under review. 4. DEPOSITS: Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. 5. MATERIAL CHANGES: During the financial year 2014-15, there are no material changes affecting the financial position of the Company and affecting the Financial Statements. 6. DIRECTOR'S RESPONSIBILITY STATEMENT: To the best of knowledge and according to the information and explanation obtained by them, your Directors make the following statements in terms of Section 134(5) of the Act. (a) That in the preparation of the annual financial statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; (b) That such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgments have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at 31st March, 2015 and of the profit or loss of the Company for the financial year ended on that date; (c) That proper and sufficient care has been taken 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; (d) That the Annual Financial Statements have been prepared on a going concern basis; (e) That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; (f) That systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 7. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL I. Appointment: Pursuant to the provisions of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company 1. Mr. T.V Rao and 2. Mrs. Anjana Motwani were appointed as an Additional Directors and were designated as an Independent Directors w.e.f. 14th February, 2015 and 30th March, 2015 respectively and that they shall hold office up to the date of the ensuing Annual General Meeting. The Company has received requisite notice in writing from a member proposing Mr. T.V. Rao and Mrs. Motwani for appointment as an Independent Directors. As per the provisions of the Companies Act, 2013, Independent Directors are required to be appointed for a term of five consecutive years, but shall be eligible for re-appointment on passing of a resolution by the Company and shall not be liable to retire by rotation. All other Directors will retire at the ensuing Annual General Meeting and, being eligible, offer themselves for re-election. The Independent Directors of your Company have given the certificate of independence to your Company stating that they meet the criteria of independence as mentioned under Section 149 (6) of the Companies Act, 2013. II. Cessation: 1. Mr. R.D. Suvarna, ceased to be a Director of the Company as he passed away on 29th April, 2014. 2. Mr. Swaminathan Sundararajan Mittur, ceased to be a Director of the Company as he passed away on 21st June, 2014. 3. Mr. Ramesh Aggarwal, resigned from the Company on 27th June, 2014. 4. Mr. Subramaniam Balakrishnaiyer Tattamangalam, ceased to be a Director as he passed away on 20th August, 2014 5. Mr. Satish Aggarwal, resigned from the Company on 18th October, 2014, due to health issues related to age. The Board placed on record its deep appreciation for the valuable contribution made by each of them during their tenure as Director of the Company. III. Policies and Programme: The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the nonexecutive directors and executive directors. The details of training and familiarization programmes and Annual Board Evaluation process for Directors have been provided under the Corporate Governance Report. The policy on Director's appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, and also remuneration for Key Managerial Personnel and other employees forms part of Corporate Governance Report of this Annual Report. 8. AUDITORS & AUDITORS' REPORT Statutory Auditors: M/s. Mittal & Associates, Chartered Accountants, Mumbai (Firm Registration No.106456W), the Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received letters from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. The Notes on Financial Statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments. Cost Auditors: During the financial year, the Company has appointed, M/s. Bhanwarlal Gurjar & Co., Cost Accountants for conducting the audit of cost records of the Company. Secretarial Auditors: As per Section 204 of the Act, Secretarial Audit Report from M/s. R L & Associates, Practising Company Secretaries (Certificate of Practice No. 11472) forms an integral part of this Report as "Annexure A." Internal Auditors: During the financial year, the Company has appointed M/s. K M Tulsian & Associates (Firm Registration No. 111075W) and M/s. Anjali Jain & Associates, (Firm Registration No. 003247C) as Internal Auditors of the Company as per Section 138 of the Act. 9. INTERNAL FINANCIAL CONTROLS: The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internalcontrol system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, the management undertakes corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. All the transactions are properly authorised, recorded and reported to the Management. The Company is following all the applicable Accounting Standards for properly maintaining the books of account and reporting Financial Statements. 10. SHARE CAPITAL: The Issued, Subscribed and Paid-Up Equity Share Capital as on 31st March, 2015 was Rs. 2,032.51 Lacs. During the year under review, the Company has not issued shares with differential voting rights nor granted any stocks options or sweat equity. As on 31st March, 2015 none of the Directors of the Company holds instrument convertible into equity shares of the Company. 11. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of Annual Return in Form MGT-9 as required under Section 92 of the Companies Act, 2013 (herein after referred to as "the Act") forms an integral part of this Report as "Annexure B". 12. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY UNDER SECTION 186: Details of Loan, Guarantees and Investments covered under the provisions of the Act, are given in the notes to the Financial Statements. 13. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES: All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. Since all related party transactions entered into by the Company were in the ordinary course of business and were on an arm's length basis, Form AOC-2 is not applicable to the Company. 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 interest of the company at large. The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website at the link: www.kisangroup.com . Your Directors draw attention of the members at after Notes to the Financial Statement which sets out related party disclosures. 14. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: The information pertaining to Conservation of Energy as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are as follows: TECHNOLOGY ABSORPTION AND RESEARCH & DEVELOPMENT : The Company has not imported any Technology from abroad. Involution is a constant process and the Company has been engaged in improving the product design, material cost, productivity, etc. as part of this process. 15. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY: The Company does not have any Risk Management Policy as the elements of risk threatening the Company's existence is very minimal. 16. SUBSIDIARIES: The Company doesn't have any Subsidiary, Associate or Joint venture. 17. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES: The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable. 18. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT: As per Clause 49 of the Listing Agreement entered with the BSE Limited, a separate Report on Management's Discussion and Analysis forms an integral part of this Report. 19. PARTICULARS OF EMPLOYEES: The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing AGM. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard. 20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations. 21. CORPORATE GOVERNANCE REPORT: As per Clause 49 of the Listing Agreement entered with the BSE Limited, a separate Report on Corporate Governance practices followed by the Company, together with a Certificate from the Company's Auditors confirming compliances forms an integral part of this Report. Further, as per Clause 49 of the Listing Agreement entered with the BSE Limited, CEO/CFO Certification confirming the correctness of the financial statements, adequacy of the internal control measures and reporting of matters to the Audit Committee forms an integral part of this Report. 22. CODE OF CONDUCT: The Board of Directors has approved a Code of Conduct which is applicable to the Independent Directors and also approved Code of Conduct for Board Members and Senior Management Personnel of the Company. The Code has been posted on the Company's website www.kisangroup.com . The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. All the Board Members and the Senior Management Personnel have confirmed compliance with the Code. 23. PREVENTION OF INSIDER TRADING: The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company's shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code. All Board Directors and the designated employees have confirmed compliance with the Code. The said Code has been posted on the Company's website www.kisangroup.com 24. VIGIL MECHANISM/WHISTLE BLOWER POLICY: 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 behaviour, your Company has adopted a Vigil Mechanism Policy. 25. ACKNOWLEDGEMENT: Your Directors take this opportunity to express their grateful appreciation for the excellent assistance and co-operation received from all our Clients, Financial Institutions, Bankers, Business Associates and the Government and other regulatory authorities and thank all stakeholders for their valuable sustained support and encouragement towards the conduct of the proficient operation of the Company. Your Directors would like to place on record their gratitude to all the employees who have continued their support during the year. For and on behalf of the Board of Directors Kisan Molding Limited Vijay J. Aggarwal Chairman & WTD Ashok J. Aggarwal Joint Managing Director Sanjeev A. Aggarwal Joint Managing Director Priyanka Chauhan Company Secretary Suresh Purohit Chief Financial Officer Date: 14th August, 2015 Place: Mumbai |