| Dear Members,
The Directors have pleasure in presenting Twenty Fourth Annual Report
on the business and operations of your Company and Audited Financial
Statement for the year ended 31st March, 2015.
FINANCIAL RESULTS :
(Rs. in lacs)
2014-15 2013-14
Revenue from
operations (Net) 3052.60 2769.55
Misc Sale (Net) 0.23 0.52
Other Income 310.75 10.38
Total Revenue 3363.58 2780.45
Less: Expenses
Cost of material
consumed 2632.58 2120.02
Changes in Inventories
of finished
Goods & Work in
Progress - 11.89 -23.86
Manufacturing Expenses 422.96 394.36
Employee Benefit Cost 97.80 90.49
Depreciation and
amortisation Expenses 61.61 43.23
Other Expenses 153.07 148.87
Total Expenses 3356.14 2773.78
Net Profit 7.43 6.67
OPERATIONS :
During the year under review, only Paper Division was operational
through out the year and produced 12968.43 M.T of Kraft Paper and
achieved sales of Rs. 3052.59 Lacs as against 12455 M.T. ' and Rs.
2769.55 Lacs of the previous year. The net profit was Rs. 7.43 Lacs as
against Rs. 6. 67 Lacs of the previous year.
Company could not run Power Division due to non availability of
bagasse, raw material for Power generation during the year. Also tenure
of power purchases agreement which was executed between the company and
MSEDCL has completed on 11/01/2015 and same renewal of power purchase
agreement is in progress.
PROSPECTS :
The streamlined operations of Paper Division will continue to give good
results during the current year too.
Company has also undertaken the expansion of current capacity of paper
division from 15000 TPA TO 20000 TPA and it will be completed somewhere
in Sept 2015. After the completion of aforesaid expansion, company will
produce additional 5000 M. T of Kraft paper every year.
REHABILITATION SCHEME :
As you aware that, company had been declared as a sick industrial unit
by BIFR in 2007 and thereafter filed the rehabilitation scheme through
our operating agency M/s. Indian Renewable Energy Development Agency Ltd
(IREDA) to the BIFR. Although BIFR in its order dated 11.11.2014 had
de-registered with stating that there is a delay in submission of
rehabilitation scheme. Consequently company had filed the appeal to the
Appellate Authority for Industrial and Financial Reconstruction (AAIFR)
against the aforesaid order of BIFR. Subsequently AAIFR on order dated
22.04.2015 remanded the case back to BIFR accepting the company's
submission and as per their aforesaid order operating agency has
resubmitted revised DRS to BIFR for their necessary approval. Now matter
is under consideration of BIFR and company is expecting the order for
approval of rehabilitation scheme in the coming financial year.
DIVIDEND:
In view of the small profit and carried forward losses of the Company,
it is not possible for your Directors to recommend any dividend.
MATERIAL CHANGES AND COMMITMENT
The company has entered into the material transaction with the related
party M/s. Kay Bouvet Engineering Limited for worth of Rs.
700,00,000/-(Seven Cores only) plus taxes extra for design,
Manufacturing, supplying, erecting and commissioning the paper machine
part for expansion of current capacity of paper division form 15,000
TPA To 20,000 TPA. This transaction will be ratified by the
shareholders in ensuing General Meeting of the company. Other than this
there are no material changes and commitments affecting the financial
position of the Company occurred between the ends of the financial year
to which this financial statement relate on the date of this report.
FIXED DEPOSIT:
As on 31st March, 2015, Company has no fixed deposits.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Company has not developed and implemented any Corporate Social
Responsibility initiatives as the said provisions are not applicable.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186
OF THE COMPANIES ACT, 2013
There were no loans, guarantees or investments made by the Company
under Section 186 of the Companies Act, 2013 during the year under
review and hence the said provision is not applicable.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
During the year under review, there was no material contract or
arrangements entered with related parties as defined under Sub- Section
1 of Section 188 of the Companies Act, 2013. Hence report in form AOC
2 as required under the sub- section 2 of section 188 of Companies Act,
2013 for disclosing material related party transactions along with the
justification for entering into such contract /arrangement is not
annexed in this Board Report.
Transactions which were entered with the related parties on ordinary
course of business and based on arm's length prices with the prior
approval of audit committee are mentioned in the note no. 30 of
financial statement in this Annual Report.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any Subsidiary, Joint venture or Associate
Company.
DIRECTORS:
Mr. Arvind V. Kulkarni director of the company retire by rotation in
ensuing general meeting and being eligible offers himself for
re-appointment at the ensuing Annual General Meeting. The necessary
resolution is being put in the Notice of the ensuing Annual General
Meeting for the consideration of the Members.
During the year under review Mr. Kaustubh Wadikar and Mr. Sandeep
Shahapurkar were appointed as an independent director of the company
for the five years from the conclusion of 23rd Annual General Meeting
to conclusion of 28th Annual General Meeting of the company.
During the year under review, company has appointed two key managerial
personnel namely, Mr. Sagar Mohite appointed as a Company Secretary of
the company w.e.f 28th May, 2014 in the place of Mr. Sham Mulye, who
had resigned from office on 31st March, 2014 and Mr. Ganesh Hari
Rotithor, Manager- Finance appointed as a Chief Financial Officer of
the company with effect from 8th July, 2014.
BOARD EVALUATION
Clause 49 of the Listing Agreement mandates that the Board shall
monitor and review the Board evaluation framework. The Companies Act,
2013 states that a formal annual evaluation needs to be made by the
Board of its own performance and that of its committees and individual
directors.
The evaluation of all the directors and the Board as a whole was
conducted based on the criteria and framework adopted by the Board.
The evaluation process has been explained in the Corporate governance
report section in this Annual Report. The Board approved the evaluation
results as collate by the nomination and remuneration committee.
None of the independent directors are due for re-appointment.
NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW
The Company had 6 (six) Board meetings during the financial year under
review.
DIRECTORS RESPONSIBILITY STATEMENT:
In accordance with the provisions of Section 134(5) of the Companies
Act, 2013 the Board hereby submit its responsibility Statement:-
(a) In the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) We 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 31st March, 2015 and of the profit and loss
of the company for that period;
(c) We 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) We have prepared the annual accounts on a going concern basis;
(e) We have laid down internal financial controls to be followed by the
company and that such internal financial controls are adequate and were
operating effectively.
(f) We have devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate
and operating effectively.
AUDITORS:
M/s. Godbole & Company, Chartered Accountants (M. No. 104822) , Satara
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 him 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. Their appointment needs to be
confirmed and their remuneration is to be fixed.
AUDITORS' REPORT:
The observations of the Auditors report read with the relevant notes
thereon are self explanatory and therefore do not call for any further
comments under Section 134 of the Companies Act, 2013.
SECRETARIAL AUDITOR
M/s. Neha Doshi & Co., Practicing Company Secretaries, was appointed to
conduct the secretarial audit of the Company for the financial year
2014-15, as required under Section 204 of the Companies Act, 2013 and
Rules there under. The secretarial audit report for FY 2014-15 forms
part of the Annual Report as Annexure I to the Board's report.
SECRETARIAL AUDITOR'S REPORT
The observations of the Secretarial Audit report are self explanatory
and therefore do not call for any further comments under Section 134 of
the Companies Act, 2013.
CORPORATE GOVERNANCE:
Pursuant to clause 49 of the Listing Agreement, report on Corporate
Governance along with Auditor's certificate on its compliance is
attached as annexure II to this report.
EXTRACT OF ANNUAL RETURN
The extracts of Annual Return pursuant to the provisions of Section 92
read with Rule 12 of the Companies (Management and administration)
Rules, 2014 is furnished in Annexure III and is attached to this
Report.
INTERNAL FINANCIAL CONTROL
The Board has adopted the policies and procedures for ensuring the
orderly and efficient conduct of its business, including adherence to
the Company's policies, the safeguarding of its assets, the prevention
and detection of frauds and errors, the accuracy and completeness of
the accounting records, and the timely preparation of reliable
financial disclosures.
SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulators
or courts or tribunals impacting the going concern status and Company's
operations in future
COST AUDITORS:
The Company was appointed Mr. S.V. Vhatte, Cost Accountant, Solapur as
Cost Auditor to conduct the audit of cost accounts maintained by the
Company, for the financial year 2014-15. Full particulars of Cost
Auditors are given here under:-
Name : S.V. Vhatte & Associates
Membership. No. : 7501
Address : A-1/2, Kadadi Nagar,
Hotgi Road,
Solapur - 413 003.
Details of Cost Audit Report for the financial year ended 31ST March,
2015
Due date of filling: by 30th September 2015.
As per the companies (Cost Records and Audit) Amendment Rules 2014, the
company has exempted for cost audit for the financial year 2015-16.
Hence company has not appointed cost auditor for the financial year
2015-16.
DECLARATION OF INDEPENDENT DIRECTORS
The Independent Directors have submitted their disclosures to the Board
that they fulfill all the requirements as stipulated in Section 149(6)
of the Companies Act, 2013 so as to qualify themselves to be appointed
as Independent Directors under the provisions of the Companies Act,
2013 and the relevant rules.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as prescribed under Sub- section (3)(m) of Section 134
of the Companies Act, 2013, read with the Companies (Accounts) Rules,
2014, the relevant information pertaining to Energy Conservation,
Technology Absorption, Foreign Exchange Earnings and Outgo are enclosed
as Annexure IV to the Board's report.
PARTICULARS OF EMPLOYEES
The table containing the names and other particulars of employees in
accordance with the provisions of Section 197(12) of the Companies Act,
2013, read with Rule 5(1) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014, is appended as Annexure V to the
Board's report.
COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF
REMUNERATION AND DISCHARGE OF THEIR DUTIES
The Company's Policy relating to appointment of Directors, payment of
Managerial remuneration, Directors' qualifications, positive
attributes, independence of Directors and other related matters as
provided under Section 178(3) of the Companies Act, 2013 is enclosed as
Annexure VI to the Board's report
LISTING OF EQUITY SHARES:
The Equity Shares of your Company are listed on BSE Ltd., where the
same are traded regularly and confirm that company has paid the listing
fees for the financial year 2015-16.
VIGIL MECHANISM
The Company has formulated a Whistle Blower Policy (the Policy) in
compliance with the Companies Act 2013 and Listing agreement, to enable
employees, customers, agents, dealers, suppliers and other vendors that
conduct business with Kay Power and Paper Limited to raise concerns and
complaints about fraudulent practices.
Under the Policy, the concerns/ complaints pertaining to General
Managers and Mangers should be raised before the Chairman of Audit
Committee and concerns against other Employees should be addressed to
the Vigilance officer and confirm that there is no personnel has been
denied access to the audit committee.
The Company has designated the Manager, Mr. Arvind Patil as the
Vigilance officer and has created the following email accounts for
facilitating the raising of such concerns.
Chairman of Audit Committee- chairmanauditcommittee@gmail.com
Vigilance officer - arvindpatil.kppl@gmail.com
The Company aims to propagate a culture for maintaining highest
standard of conduct and professionalism and therefore this Policy is
implemented in furtherance of the Code of Conduct of the Company.
The details of establishment of such mechanism have also been disclosed
on company website on following link - http://
www.kaypowerandpaper.com/download/ Annoncement-KPPL.pdf
COMMITTEES OF THE BOARD
Currently, the Board has four committees: the audit committee,
nomination and remuneration committee, stakeholder's relationship
committee, and risk Management committee. The role and responsibilities
and composition of the aforesaid committees are mentioned in the
corporate governance report section in this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
A comprehensive Management discussion and analysis Report is appended
as Annexure VII, forming a part of the Corporate Governance is part of
this Annual Report
ACKNOWLEDGEMENT:
Your Directors appreciate valuable contribution of employees at all
levels. Your Directors place on record their gratitude for the
co-operation received from Indian Renewable Energy Development Agency
Ltd., Maharashtra State Electricity Distribution Company Ltd., IDBI
Bank Ltd., HDFC Bank Ltd., Suppliers, Customers and Shareholders of the
Company and look forward to their continuous support in coming years.
For and on behalf of the Board of Directors
Niraj Chandra
Date : 25th June, 2015 Chairman and
Place : Satara Managing Director
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