To
The Members of KABSONS INDUSTRIES LIMITED,
Your Directors have pleasure in presenting the 31st Annual Report of the
Company together with the Audited Financial Statements for the year ended 31st
March, 2023.
FINANCIAL RESULTS: (Rs.in thousands except EPS)
|
Financial Year 2022-2023 |
Financial Year 2021-2022 |
Revenue from operations |
1,69,955.88 |
1,13,517.56 |
Other Income |
3,373.98 |
6,131.21 |
Total Revenue |
1,73,329.86 |
1,19,648.76 |
Total Expenses |
1,65,417.57 |
1,04,018.73 |
Profit before Finance Cost, Depreciation & exceptional items |
14,009.06 |
20,817.07 |
Finance Cost |
802.77 |
483.78 |
Depreciation |
5,293.99 |
4,703.26 |
Exceptional items |
.01 |
383.41 |
Profit/ (Loss) before Tax |
7,912.31 |
16,013.44 |
Tax Expenses (Earlier year Tax Paid) |
15.49 |
0.05 |
Profit after Tax |
7,896.82 |
16,008.36 |
Basic & Diluted Earnings per share of Rs.10/- each |
0.45 |
0.92 |
The state of the company's affairs:
Operations and Business Performance:
During the year under consideration, the Company has generated a profit of Rs.
14,009.06 thousands before finance costs, depreciation and exceptional items as against a
profit of Rs. 20,817.07 thousands during the previous year, which includes lease income
and lease income is the major source of revenue to the Company. Your Directors are trying
every opportunity for improving the performance with increased revenue in the next year.
Business Review
The Company has been focusing on Lease income and as per recent demand, a new Factory
shed is offered for lease from the month of April 2023. The company also started bottling
operations for another party also at our Ranchi bottling plant from the month of May 2023.
The Company acquired the some of the assets of plant and machinery and other equipment
from the EIIL (who was operating our Bottling plant at Rohtak on lease) from 1st
April, 2023 and envisaging to start a new project of mainly supplying Aerosol grade LPG to
various industrial customers and our Company has also completed the repairs and
maintenance jobs at this plant and awaiting for starting of operations.
Material changes and commitments if any affecting the financial position of the Company
occurred between the end of the financial year to which this Financial Statements relate
and the date of the report
There have been no material changes and commitments, affecting the financial position
of the Company which occurred during between the end of the financial year to which the
financial statements relate and the date of this report.
Details of significant and material orders passed by the regulators/ courts/ tribunals
impacting the going concern status and the Company's operations in future.
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.
Share Capital:
Authorized Share Capital
During the year under review, there was no change in authorized share capital of the
Company. Authorized share capital of the company as on March 31, 2023 was
Rs.18,00,00,000/-, comprising of 1,80,00,000 equity shares of Rs.10/- each.
Paid-up Share Capital
During the year under review, there was no change in paid up share capital of the
Company. Paid up share capital of the company as on March 31, 2023 was Rs.17,46,30,000/-,
comprising of 1,74,63,000 equity shares of Rs.10/- each.
Buy Back of Securities
The Company has not bought back any of its securities during the year under review.
Sweat Equity
The Company has not issued any Sweat Equity Shares during the year under review.
Bonus Shares
The Company has not issued any bonus shares during the year under review.
Employees Stock Option
The Company has not provided any Stock Option Scheme to the employees.
Dividend
Your Directors have not recommended any dividend on Equity Shares for the year under
review.
Transfers to Reserves
Your Board of Directors does not appropriate any amount to be transferred to General
Reserves during the year under review.
Deposits
During the year under review, your Company has not accepted any deposits within the
meaning of Section 73 of the Companies Act, 2013 read with rules made there under.
Subsidiaries, Joint Ventures and Associate Companies
The Company does not have any Subsidiary, Joint venture or Associate Company
Particulars of Contracts & Arrangements with Related Parties
All transactions entered by the Company with Related Parties were in the Ordinary
course of Business and are at Arm's Length pricing basis. The Audit Committee granted
approvals for the transactions and the same were reviewed by the Committee and the Board
of Directors.
There were no materially significant transactions with Related Parties during the
financial year 2022-2023 which were in conflict with the interest of the Company. The
details of contracts and arrangements with related parties as referred to in Section
188(1) of the Companies Act, 2013 were given as Annexure - I to the Board's
Report in form No: AOC-2 pursuant to Section 134 (3)(h) of the Act read with Rule 8(2) of
the Companies (Accounts) Rules 2014.
Related party Transactions:
The details of the Related Party Transactions are furnished in Note 34.3.5 of the Notes
on the Financial Statements attached to this Report.All the related party transactions
have been on an arm's length basis.
Particulars of Loans, Guarantees or Investments
Your Company has not given any Loans / Guarantees and not made any Investments during
the FY 2022-23, as specified under the provisions of Section 186 of the Companies Act,
2013 read with Companies (Meetings of Board and its Powers) Rules, 2014.
Number of Board Meetings held
The Board of Directors duly met 4 times during the financial year from 1st
April, 2022 to 31st March, 2023, the details of which are given in the
Corporate Governance Report. The maximum interval between any two meetings did not exceed
120 days, as prescribed in the Companies Act, 2013 and Secretarial Standard -1.Details of
these meetings of the Board as well as its committees have been given in the Corporate
Governance Report, which forms parts of the Annual Report.
Sub Committees of the Board
The Board has Audit Committee, Nomination and Remuneration Committee, Stakeholders
Relationship Committee and Risk Management Committee.
The composition and other details of these committees have been given in the report on
the Corporate Governance which forms part of the Annual Report.
Directors and Key Managerial Personnel
During the year under review, the following were the Key Managerial Personnel' of
the Company: Sri. Rajiv Kabra Managing Director Sri. Krishna Murthy Motamarri -
Chief Financial Officer; and Sri. Nagaraju Musinam Company Secretary and Compliance
Officer
Directors
The Company is well supported by the knowledge and experience of its Directors and
Executives. In terms of Section 152 of the Companies Act, 2013 and Articles of Association
of the Company, Ms. Riha Kabra, Non Executive Director of the Company is liable to retire
by rotation and being eligible, has offered herself for reappointment.
Mr.Sumit Jaiswal was appointed as an additional director independent for five years on
12.08.2023 subject to approval of shareholders In the opinion of the Board, the
independent director appointed during the year possess requisite integrity, expertise,
experience and proficiency.
Based on the confirmations received from Directors, none of the Directors are
disqualified from appointment under section 164 of the Companies Act 2013.
Declaration by Independent Directors
The Independent Directors of the Company have submitted their declarations as required
under Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of
independence as per sub-section (6) of Section 149 of the Act.
Familiarization programme for Independent Directors
The Company proactively keeps its Directors informed of the activities of the Company,
its management and operations and provides an overall industry perspective as well as
issues being faced by the industry.
Independent Directors Meeting
The Independent Directors met on 14.02.2023, without the attendance of Non-Independent
Directors and members of the Management. The Independent Directors reviewed the
performance of Non-Independent Directors and the Board as a whole; the performance of the
Chairman of the Company, taking into account the views of Executive Director and assessed
the quality, quantity and timeliness of flow of information between the Company Management
and the Board that is necessary for the Board to effectively and reasonably perform their
duties.
Board Evaluation:
The Board adopted a formal mechanism for evaluating its performance as well as that of
its Committees and individual Directors, including the Chairman of the Board. The exercise
was carried out through a structured evaluation process covering various aspects of the
Board functioning such as composition of the Board & committees, experience &
competencies, performance of specific duties & obligations, contribution at the
meetings and otherwise, independent judgment, governance issues etc.
Secretarial Standards
The Company complies with all applicable secretarial standards issued by the Institute
of Company Secretaries of India.
Directors Responsibility Statement as required under Section 134(5) of the Companies
Act, 2013:
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013 the Board of
Directors states that:
a) In the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures;
b) They 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 of the profit
and loss for that period;
c) They have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d) They have prepared the annual accounts on a going concern basis;
e) They have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and were operating effectively and
f ) They have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
Policy on Directors Appointment and Remuneration and Other Details
The Company's policy on directors' appointment and remuneration and other matters
provided in Section 178 (3) of the Companies Act, 2013 have been disclosed in the
corporate governance report. Under Section 178 (3) of the Companies Act, 2013, the
Nomination and Remuneration Committee of the board has adopted a policy for nomination,
remuneration and other related matters for directors and senior management personnel. A
gist of the policy is available in the Corporate Governance Report.
Statutory Auditors
M/s. K S Rao & Co., Chartered Accountants, (Firm Registration No.003109S), was
appointed as the statutory auditors of the Company, to hold office for the second term of
five consecutive years from the conclusion of the 30th AGM of the Company held
on September 23, 2022, till the conclusion of the 35th AGM to be held in 2027,
as required under Section 139 of the Companies Act, 2013 read with the Companies (Audit
and Auditors) Rules, 2014.
Qualification by Statutory Auditor
Information & Explanation in respect of Qualification / Reservation or Adverse
remarks contained in Independent Auditors Report under Paras: Basis for Qualified opinion,
Emphasis of Matter and Other Matters:
1 The company has not adopted and complied with requirements of IND AS 19
Employee Benefits' in respect of the gratuity liability which constitute a departure
from the Indian Accounting Standards.
2 In the financial statements which states that the Company has not provided for the
interest expense amounting to Rs.6,12,049/- for the year and Rs.1,34,05,415/- for earlier
years against the Trade Deposits received from the Dealers/ Distributors. Consequently,
the same has resulted in overstatement of profit for the year by Rs.6,12,049/-
overstatement of the balance in the retained earnings, in other equity, by
Rs.1,40,17,464/- and understatement of Current Liabilities by Rs.1,40,17,464/-
Management View: 1) In view of very limited strength of employees, presently
working with the Company, the requirements of AS-19 Employee Benefits in respect of
gratuity could not be complied with. However, provision for gratuity as required under
Payment of Gratuity Act has been provided for. 2) Interest for the year Rs.6,12,049/- on
deposits of Dealers/Distributors has not been provided in view of Company's adverse
financial position and will be negotiated for waiver resulting to overstatement of profit
by that amount and understatement of Current liabilities by Rs.1,40,17,464.
Secretarial Auditors
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors has appointed
M/s. B S S& Associates, Practicing Company Secretaries for conducting Secretarial
Audit of the Company for the financial year 2022-2023. The Secretarial Audit Report is
annexed herewith as Annexure - II.
Qualification by Secretarial Auditor
The Secretarial Auditor's Report does not contain any qualifications, reservation or
adverse remarks during the year review.
Internal Auditors
In pursuance of Section 138 of the Companies Act, 2013 read with rules made there
under, the Board has appointed Mr. M Krishna Murthy, CFO of the Company as Internal
Auditors of the Company to carry out internal auditing of books of accounts periodically.
Maintenance of Cost Records
The Central Government has not prescribed the maintenance of cost records under Section
148 of the Act, for any of the services rendered by the Company.
Vigil Mechanism / Whistle Blower Policy
Pursuant to Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies
(Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the SEBI (LODR)
Regulations 2015, the Board has adopted Whistle Blower Policy. This policy aims for
conducting the affairs in a fair and transparent manner by adopting highest standards of
professionalism, honesty, integrity and ethical behavior.
A mechanism has been established for employees to report concerns about unethical
behavior, actual or suspected fraud or violation of Code of Conduct and Ethics. The policy
also provided adequate safeguards against the victimization of employees who avail of the
mechanism and allows direct access to the Chairman of the Audit Committee in exceptional
cases.
Your Company hereby affirms that during the year no Director / employee have been
denied access to the Chairman of the Audit Committee and that no complaints were received.
Management Discussion and Analysis
Management Discussion and Analysis Report for the year under review, as stipulated
under SEBI Listing Regulations, is annexed herewith as Annexure IIIwhich forms part of
this report.
Risk Management
The Risk Management Committee duly constituted by the Board had formulated a Risk
Management Policy for dealing with different kinds of risks attributable to the operations
of the Company. Risk Management Policy of the Company outlines different kinds of risks
and risk mitigating measures to be adopted by the Board. The Company has adequate internal
control systems and procedures to combat the risk. The Risk Management procedure will be
reviewed periodically by the Audit Committee and the Board.
Corporate Social Responsibility (CSR) Initiatives:
Section 135 of the Companies Act, 2013 provides the threshold limit for applicability
of the CSR to a Company ie. (a) networth of the Company to be Rs.500 crore or more; or (b)
turnover of the company to be Rs. 1,000 crore or more; or (c) net profit of the company to
be Rs. 5 crore or more. As the Company does not fall under any of the threshold limits
given above, the provisions of section 135 are not applicable to the Company.
Annual Return
Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the Annual
Return in eform MGT 7 is placed at the company website at https://www.kabsons.co.in.
Information on Conservation of Energy, Technology Absorption & Foreign Exchange
Earnings and outgo
Pursuant to the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with
Rule 3 of Companies (Accounts) Rules, 2014, these particulars are not relevant to the
company's operations and hence not furnished the same.
Company's Policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women
at Workplace
The Company prohibits any form of sexual harassment and any such incidence is
immediately investigated and appropriate action taken in the matter against the offending
employee(s) based on the nature and the seriousness of the offence. The Company has a
policy on Prohibition, Prevention and Redressal of Sexual Harassment of Women at Workplace
(the Policy) and matters connected therewith or incidental thereto covering all the
aspects as contained under the "The Sexual Harassment of Women at Workplace
(Prohibition, Prevention and Redressal) Act, 2013" notified by the Government of
India vide Gazette Notification dated 24thApril, 2013.
There was no case of sexual harassment reported during the year under review.
Remuneration ratio of the Directors / Key Managerial Personnel (KMP) / Employees:
The information required under Section 197 of the Companies Act, 2013 read with rule
5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
are provided in separate annexure forming part of this Report as Annexure IV.
Corporate Governance
The Company is committed to good corporate governance in line with the SEBI (LODR)
Regulations, 2015 and Provisions, Rules and Regulations of the Companies Act, 2013. The
Company is in compliance with the provisions on corporate governance specified in the SEBI
(LODR) Regulations, 2015 with BSE. A certificate of compliance from B S S &
Associates, Company Secretaries and the report on Corporate Governance form part of this
Directors' Report as Annexure V.
Details in respect of frauds reported by Auditors under Section 143 (12) other than
those which are reportable to the Central Government.
There were no frauds reported by the Statutory Auditors under sub-section 12 of Section
143 of the Companies Act, 2013 along with Rules made there under.
Details of application made or any proceeding pending under the Insolvency and
bankruptcy code, 2016 during the year
The Company has not made any application under the Insolvency and Bankruptcy Code,
2016, during the year under report.
Details of difference between amount of the valuation done at the time of one time
settlement and the valuation done while taking Loan from the banks or financial
institutions along with the reasons thereof
The requirement to disclose the details of difference between amount of the valuation
done at the time of onetime settlement and the valuation done while taking loan from the
Banks or Financial Institutions along with the reasons thereof is not applicable.
Awards and recognition
The Company has not received any award during the Financial Year.
Acknowledgments
The Directors wish to place on record their gratitude to shareholders and thank the
customers, vendors, franchisees, bankers, Department of Explosives and their Officials,
Central Excise, Pollution Control Boards and Commercial Tax Departments of respective
States, host of other State and Central Government Departments, Security Exchange Board of
India and Stock Exchanges at Mumbai, Ahmedabad and Kolkata and others for their continued
support to the Company's growth. The Directors also wish to place on record, their
appreciation for the contribution made by the employees at all levels, for their
sincerity, hard work, solidarity and dedicated support to the Company.
|
By Order of the Board of Directors of |
|
Kabsons Industries Limited |
|
Sd/- |
|
Rajiv Kabra |
Place : Hyderabad |
Managing Director |
Date : 12.08.2023 |
|