DIRECTORS' REPORT To The Members, Your directors have pleasure in presenting the '23rd ANNUAL REPORT' together with the Audited Accounts for the year ended 31st March, 2015. BUSINESS PERFORMANCE During the year the company has achieved gross revenue of Rs. 1686.77 Lacs as compare to previous year of Rs.1672.98 Lacs. The company has earned profit before tax of Rs. 25.93 Lacs as compared to previous year Loss of Rs. 59.18 Lacs. The company has been consistently trying to capture the local market. It is expected that the company in the near future will do better. DIVIDEND In order to conserve resources by the Company, the Board does not recommend any dividend for the financial year ended 31st March, 2015. SHARE CAPITAL The paid up Equity Share Capital as on March 31, 2015 was Rs.5,13,87,770/-. During the year under review the company has not issued any shares or any convertible instruments. MANAGEMENT DISCUSSION & ANALYSIS PVC Pipes are fast becoming the preferred mode of carrying water from the location of its source to the location of its use. Inversely, PVC Pipes are also useful for carrying the used water and sanitary waste towards the location of its disposal. Safety, reliability and strength - the important attributes of PVC Pipes are gradually yet definitely finding favour with the users as well as government and quasi-government authorities responsible for water and waste water management. As per the statistics, only about 43% of the land under cultivation in India has access to irrigation. This means that more than half of India's agriculture still depends on the monsoon. Successive governments have allocated large funds to increase the reach of irrigation. An increase in disposable income in rural India and a continued focus by the Government to increase irrigation coverage in the country augurs well for the demand of your Company's products. Your Company has experienced that the demand for PVC pipes is acyclical in nature. A good monsoon implies better purchasing power for the farmer, thereby resulting in a high demand for pipes. Similarly, a poor monsoon requires the farmer to source water from farther distances, thereby also increasing the demand for pipes. Furthermore, the area under irrigation in India is abysmally low and the potential for irrigation is so large that your Company does not expect any structural drop in demand in the foreseeable future. Your Company has therefore seen a CAGR of more than 15% over the last ten years, and expects this trend to continue in the years to come. The company has instituted adequate internal control procedure commensurate with the nature of its business and the size of its operations. Internal Audit is conducted at regular intervals and covers the key areas of operations. All significant audit observations and follow-up actions thereon are reported to the Audit Committee. Your company's Industrial relations continued to be harmonious during the year under review. The focus is on maintaining employee motivation at a high level with stress on leadership development. Estimates and expectations stated in this Management Discussion and Analysis may be "forward-looking statement" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expected or implied. Important factors that could make a difference to your Company's operations include economic conditions affecting demand/supply and price conditions in the domestic and international markets, changes in the Government regulations, tax laws, other statues and other incidental factors. CORPORATE SOCIAL RESPONSIBILITY The company has not developed and implemented any Corporate Social Responsibility initiatives as the provisions of section 135 of the Companies Act, 2013 are not applicable. HUMAN RESOURCES Our underlying belief is that Human Resource Development today is about nurturing human resources and leveraging human capital towards the achievement of business goals. The Company is committed towards creation of opportunities for its employees that help attract, retain and develop a diverse workforce. BUSINESS RISK MANAGEMENT The Company has developed & implemented Risk Management Policy. However, Company has not come across any element of risk which may threaten the existence of the Company. VIGIL MECHANISM / WHISTLE BLOWER POLICY As required under section 177 (9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Boards and its Powers) 2014 and Clause 49 of the Listing Agreement, the Company has adopted a policy on vigil mechanism/whistle blower. The policy provides direct access to the Chairman of the Audit Committee in case any employee should choose to report or bring up a complaint. Your company affirms that on one has been denied access to the Chairman of the Audit Committee and also that no complaints were received during the year. INTERNAL FINANCIAL CONTROLS The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed. DIRECTORS & KMP Mrs. Krishna Gupta, retire by rotation at the ensuing Annual General Meeting and, being eligible, offer herself for re-appointment. Sh. Vishesh Chugh, Company Secretary of the company left the organization on 24th March, 2015. Sh. Sanjay Agarwal was appointed as CFO of the company on 25th March, 2015. All independent directors have given declaration that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and clause 49 of listing agreement. BOARD EVALUATION Pursuant to the provisions of companies Act, 2013 and clause 49 of the Listing Agreement, the Board has carried out annual performance evaluation of its own performance, the directors individually as well the evaluation of the working of its Audit, Nomination & Remuneration and Stakeholder committee. The manner in which the evaluation has been carried out has been explained in Corporate Governance Report. REMUNERATION POLICY The Board has, on the recommendation of the Nomination & Remuneration committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. MEETINGS During the year Seven Board Meetings and one independent directors' meeting was held. The Details of which are given in Corporate Governance Report. The provisions of Companies Act, 2013 and listing agreement were adhered to while considering the time gap between two meetings. AUDIT COMMITTEE The company is having an audit committee comprising of the following directors: 1. Sh. Satya Prakash Kanodia, Chairman, Non Executive & Independent Director 2. Sh. Manoj Goyal, Member, Non Executive & Independent Director 3. Sh. Pankaj Agarwal, Member, Non Executive & Independent Director NOMINATION AND REMUNERATION COMMITTEE The company is having a Nomination and Remuneration Committee comprising of the following directors: 1. Sh. Satya Prakash Kanodia, Chairman, Non Executive & Independent Director 2. Sh. Manoj Goyal, Member, Non Executive & Independent Director 3. Sh. Pankaj Agarwal, Member, Non Executive & Independent Director DIRECTORS' RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013: a) that in the preparation of the annual financial statements for the year ended March 31, 2015, 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 judgement and estimates 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 March 31, 2015 and of the profit of the Company for the 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 were in place and were adequate and operating effectively. RELATED PARTY TRANSACTIONS All related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons or entities which may have a potential conflict with the interest of the Company at large. All Related Party Transactions are placed before the Audit Committee as also the Board for approval. MATERIAL CHANGES Arcee Ispat Udyog Limited is associate concern whose bank account was declared 'NPA' during the financial year 2013-2014. Now, the bank has also decided to reduce the working capital limits of your company gradually to NIL by 31-07-2015 which may adversely impact on the working of the Company. The Company is seeking alternate sources of financing. 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. STATUTORY AUDITORS M/s. Jain Mittal Chaudhary & Associates, Chartered Accountants (Firm Registration No. 015140N) have been appointed as statutory auditors of the company at the last Annual General Meeting held on 30.09.2014 for a period of five years subject to ratification by members at every consequent Annual General Meeting. Therefore, ratification of appointment of Statutory Auditors is being sought from the members of the Company at the ensuing AGM. They have given their eligibility & consent for the proposed ratification. SECRETARIAL AUDITORS Pursuant to 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 Ms. Anju Jain (CP No.: 2728, ACS No: 11056), Company Secretaries to undertake the secretarial audit of the company. The Secretarial Audit Report is annexed herewith as 'Annexure 1'. AUDITORS OBSERVATIONS The auditors observations being self explanatory, have been duly explained in the notes to the accounts. FIXED DEPOSITS The company has not accepted any fixed deposits from the public. INSURANCE The Company's properties have been adequately insured. COMPLIANCE OF GUIDELINES OF SEBI/STOCK EXCHANGE We have duly complied with all the guidelines issued by SEBI/Stock Exchange. CORPORATE GOVERNANCE Pursuant to clause 49 of the Listing Agreements entered into with the stock exchange, a separate section on corporate governance and a certificate obtained from the auditors of the company regarding compliance with the conditions of corporate governance are forming part of this annual report. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure 2". EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT - 9 is annexed herewith as "Annexure 3". PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The Company has not given any loan or provided any guarantee or made any investment covered under section 186 of the Companies Act, 2013. PARTICULARS OF EMPLOYEES The Company has not appointed any employee(s) in receipt of remuneration exceeding the limits specified under Rule 5 (2) of Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014. DISCLOSURE IN TERMS OF THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 The Company takes all necessary measures to ensure a harassment-free workplace and has instituted a system for redressal of complaints and to prevent sexual harassment. During the year, there were no complaints relating to sexual harassment. ACKNOWLEDGMENT Your directors are pleased to place on record their sincere gratitude to the Government Authorities, Financial Institutions, Bankers, Shareholders, Customers, Dealers and Vendors for their continued and valuable co-operation and support to the Company. Your directors express their deep appreciation for the devoted and sincere efforts put in by the members of the team at all levels of operations in the Company during the year. The company feels confident of continued co-operation and efforts from them in future also. FOR AND ON BEHALF OF THE BOARD Krishna Gupta (Director) DIN - 00284849 Ramesh Chander Gupta (Whole Time Director) DIN - 00284823 CIN : L29120HR1992PLC031681 Phone: (01662) 276178 Fax : (01662) 276145 Email : arceeind@rediffmail.com Date : 30th May, 2015 REGISTERED OFFICE : 7th K.M. Barwala Road, Talwandi Rana, Hisar-125 001 |