| DEAR MEMBERS,
The Directors take pleasure in presenting the 30th Annual Report
together with the audited financial statements for the year ended 31st
March, 2015. The Management Discussion and Analysis has also been
incorporated into this report.
1. HIGHLIGHTS OF PERFORMANCE
* Consolidated income for the year was Rs.6701.40 Lakhs as compared to
Rs.7074.62 Lakhs in the previous year a decline of 5.57%;
* Consolidated net sales for the year was Rs.6626.43 Lakhs as compared
to Rs.7053.88 Lakhs in the previous year, a decline of6.45%;
* Consolidated profit before tax for the year was Rs.161.22 Lakhs as
compared to Rs.302.78 Lakhs in the previous year;
* Consolidated Profit after tax for the year was Rs.118.10 Lakhs as
compared to Rs.196.01 Lakhs in 2014.
2. FINANCIAL RESULTS (Rs.ln Lakhs)
Particulars Consolidated Stand Alone
Particulars Consolidated
31.03.2015 31.03.2014
Revenue from Operations (Net) 6701.40 7074.62
and other income
Profit before Financial Cost 429.88 483.46
& Depreciation
Financial Cost 97.46 70.42
Depreciation 171.20 110.26
Adjustment related to Fixed 32.27 -
Assets (Net of Deferred Tax)
Profit Before Tax (PBT) 161.22 302.78
Provision for Tax 43.12 106.77
Profit After Tax (PAT) 118.10 196.01
Less: Minority Interest 0.02 -
Balance brought forward 1042.99 940.27
from previous year
Profit available for Appropriations 1161.07 1136.28
Appropriations:
Proposed Final Equity Dividend 37.00 37.00
Tax on Equity Dividends 7.53 6.29
General Reserve 30.00 50.00
Surplus carried to the next 1054.27 1042.99
year's account
Particulars Standalone
31.03.2015 31.03.2014
Revenue from Operations (Net) 6558.78 6909.55
and other income
Profit before Financial Cost 419.29 468.25
& Depreciation
Financial Cost 97.12 69.56
Depreciation 161.73 103.66
Adjustment related to Fixed 32.17 -
Assets (Net of Deferred Tax)
Profit Before Tax (PBT) 160.44 295.02
Provision for Tax 42.78 104.23
Profit After Tax (PAT) 117.66 190.79
Less: Minority Interest - -
Balance brought forward 1037.42 939.91
from previous year
Profit available for Appropriations 1155.08 1130.70
Appropriations:
Proposed Final Equity Dividend 37.00 37.00
Tax on Equity Dividends 7.53 6.29
General Reserve 30.00 50.00
Surplus carried to the next 1048.38 1037.41
year's account
3. DIVIDEND
Your directors are pleased to recommend a dividend of Re. 0.50 per
share (5%) of Rs.10/- each absorbing a sum of Rs. 44.53 Lacs.
(Previous year Re. 0.50 per share (5%) of Rs. 10/- each). The dividend
will be paid to all shareholders whose names appear in the Register of
Members as on the book closure date.
4. SHARE CAPITAL
The paid up Equity Share Capital as on 31st March, 2015 was Rs.
7,40,00,000/- divided into 74,00,000 equity shares of Rs. 10/- each.
During the year under review, the Company has not issued shares with
differential voting rights nor granted stock options nor sweat equity.
4.1 Transferto reserves
During the year under review your company has transferred Rs.
30,00,000/-to the general reserves. (Previous year Rs. 50,00,000/-)
5. FINANCE
Cash and cash equivalent as at31stMarch, 2015 was Rs.97.12 Lacs. The
Company continues to focus on judicious management of its working
capital. Receivables, inventories and other working capital parameters
were kept under strict check through continuous monitoring.
5.1 DEPOSITS
The Company has not accepted deposit from the public falling within the
ambit of Section 73 of the Companies Act, 2013 and The Companies
(Acceptance of Deposits) Rules, 2014 and there were no remaining
unclaimed deposits as on 31 st March, 2015. Further that it has not
accepted any deposit in violation of the provisions of the Chapter V of
the Companies Act, 2013.
5.2 PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to the Financial Statements.
In addition to the above, the Company has given advance against salary
or otherwise to employees of the Company as per the terms of
appointment and the Company's policy on which no interest were charged.
6. ECONOMIC SCENARIO AND OUTLOOK
The low economic growth appears to have bottomed out and a gradual
increase in economic activity is expected in 2015. The medium term to
long term growth prospects look positive in view of the Government's
determination to bring in reforms. For the year 2015, the economy is
expected to grow at a higher rate than in 2014. The long term prospect
for the economy is optimistic.
7. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
In view of the paid up capital, profits and turnover of the company
during the previous three years, the Company does not fall under the
provisions of the section 135 of the Companies Act, 2013 and the rules
made their under.
8. OCCUPATIONAL HEALTH & SAFETY (OH&S)
With regard to contractor safety, two key areas of focus identified
were Facility Management for the contractors' employees and Equipment,
Tools & Material Management. The Facility Management initiative was
implemented to ensure adequate welfare facilities for contract labor
such as washrooms with bathing facilities, rest rooms, availability of
drinking water etc. The Equipment, Tools & Material Management program
ensured that the tools used by contractors were safe. The process of
screening of contractors was made more stringent to ensure that the
contractors were aligned with the Company's objectives to ensure 'Zero
Harm'.
9. HUMAN RESOURCES
Many initiatives have been taken to support business through
organizational efficiency, process change support and various employee
engagement programmes which has helped the Organization achieve higher
productivity levels. A significant effort has also been undertaken to
develop leadership as well as technical/ functional capabilities in
order to meet future talent requirement.
The Company's HR processes such as hiring and on-boarding, fair
transparent online performance evaluation and talent management
process, state-of-the-art workmen development process, and market
aligned policies have been seen as benchmark practices in the Industry.
During the year under review, the following Human Resources initiatives
received greaterfocus:
* Employer of Choice: Employees are encouraged to express their views
and are empowered to work independently. Employees are given the
opportunity to learn through various small projects which make them
look at initiatives from different perspectives and thus provide them
with a platform to become result oriented. This has helped greatly in
overall development of the employee and has significantly arrested the
attrition rate.
* Leadership Development: As a part of leadership development, talented
employees have been seconded to the senior leadership team to mentor
them and prepare them for the next higher role.
* Industrial Relations: The Company's Industrial Relations policy has
been benchmarked by the manufacturing sector. The Company shares
relevant business information with the Unions in order to enlighten
them and make them sensitive towards business requirements. This has
helped to build a healthy relationship and resolve issues through
mutual dialogue.
10. RISK MANAGEMENT POLICY AND INTERNAL ADEQUACY
The Company has in place a mechanism to identify, assess, monitor and
mitigate various risks to key business objectives. Major risks
identified by the businesses and functions are systematically addressed
through mitigating actions on a continuing basis. These are discussed at
the meetings of the Audit Committee and the Board of Directors of the
Company.
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The scope and authority of the
Internal Audit (IA) function is defined in the Internal Audit Charter.
To maintain its objectivity and independence, the Internal Audit
function reports to the Chairman of the Audit Committee of the Board.
Based on the report of internal audit function, process owners
undertake corrective action in their respective areas and thereby
strengthen the controls. Significant audit observations and corrective
actions thereon are presented to the Audit Committee of the Board.
11. VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has a vigil mechanism named vigil mechanism/whistle blower
Policy to deal with instance of fraud and mismanagement, if any. The
details of the Policy is explained in the Corporate Governance Report
and also posted on the website of the Companywww.dnhindia.com
12. AUDITED FINANCIAL STATEMENTS OF THE COMPANY'S SUBSIDIARIES
Pursuant to the Rule 9(5)(iv) of the Companies (Accounts) Rules, 2014
the following particulars being submitted to the Companies become
Subsidiary, Associates or ceased pursuant to the provisions of section
2(6) of the CompaniesAct,2013.
Name of the Position as on Date on which Date on which
other Company 1st April, 2014 become as a ceased asa
Associate Associate
V & H Fabricators Wholly Owned 07.07.2012 -
Pvt. Ltd. Subsidiary
Commonwealth Subsidiary - -
Mining Pvt. Ltd.
Name of the Reasons Remarks
other Company
V & H Fabricators Entire shareholding -
Pvt. Ltd. with the Company with
Nominee of Harsh Vora
Commonwealth holding 50% of -
Mining Pvt. Ltd. share capital
As on 31st March, 2015, the Company Commonwealth Mining Pvt. Ltd. is
not carrying any business activities. The Company does not have joint
venture Company at the beginning or any time during the year 2014-15.
In accordance with Section 129(3) of the Companies Act, 2013, the
Company has prepared a consolidated financial statement of the Company
which is forming part of the Annual Report. A statement containing
salient features of the financial statements of the subsidiary company
is also included in the Annual Report.
In accordance with third proviso of Section 136(1) of the Companies
Act, 2013, the Annual Report of the Company, containing therein its
standalone and the consolidated financial statements has been placed on
the website of the Company, www.dnhindia.com. Further, as per fourth
proviso of the said section, audited annual accounts of the subsidiary
company have also been placed on the website of the Company,
www.dnhindia.com. Shareholders interested in obtaining a copy of the
audited annual accounts of the subsidiary company may write to the
Company Secretary at the Company's registered office.
13. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONALS
13.1 Independent Directors
At the Annual General Meeting (AGM)ofthe Company held on 30th Sept,
2014, the Members of the Company had re-appointed the existing
independent directors Shri Basant Singh Johari, (DIN 00155715) Shri
Jagdish Chand Kapur (DIN 00155290) and Shri Surjit Singh (DIN 00654215)
as Independent Directors under the Companies Act, 2013 for a period of
5 years upto 31st March 2019. The Company has further appointed Shri
Eshanya B Guppta (DIN 01727743) and Shri Sunil Kathariya (DIN 07155856)
in the category of Independent Director by the Board at their meeting
held on 15th May, 2015.
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
13.2 Executive directors and Key Managerial Personnel's
The Board of Directors had on the recommendation of the Nomination &
Remuneration Committee appointed Shri Harsh Vora (DIN 00149287) as
Managing Director for a further period of three yearw.e.f. 29lh
October, 2014 and Shri Saurabh Vora (DIN 02750484) & Mrs. Atithi Vora
(DIN 06899964) as Whole Time Directors for a period of three yearw.e.f.
1sl October, 2014
The Company is already having Shri Harsh Vora as the Managing Director
and Shri Madhusudan Jain as the Whole-time director being the Key
Managerial Personnel's of the Company.
The Board has approved the re-designation of Shri Rajesh Sen, Company
Secretary of the Company as a Company Secretary and Key Managerial
Person of the Company and Shri Sanat Kumar Jain, General Manager
Finance of the Company as a Chief Financial Officer (CFO) and Key
Managerial Person of the Company w.e.f. 1st April, 2014.
13.3 Directors seeking re-appointment
In accordance with the provisions of the Companies Act, 2013 and in
terms of the Memorandum and Articles of Association of the Company,
Shri Sushil Rawka (DIN 00156990) retires by rotation and is eligible
for re-appointment.
Shri Eshanya B Guppta (DIN: 01727743) and Shri Sunil Kathariya (DIN:
07155856) were appointed by the Board as an additional directors in the
category of the Independent director at their meeting held on 15th May,
2015 and the Company has received a notice as required under section
160 of the Companies Act, 2013 for proposal to appoint them at the
Annual General Meeting in the category of the Independent Directors of
the Company.
Shri Madhusudan Jain, Whole-time directors, whose term is being over on
23rd January, 2016 has been re- appointed by the Board upon the
recommendation of the Remuneration and Nomination Committee of the
Board for a further tenure of 3 years w.e.f. 24th January, 2016,
subject to the approval of the Central Government.
Your directors recommend to pass necessary resolution as set out in the
Item No. 5 to 7 of the notice of the annual general meeting.
13.4 Directors ceased during the year
Shri Vimal Lunia and Shri Nirmal Lunia, the Directors have resigned
from the Board w.e.f. 12th August 2014 due to pre- occupation. Your
directors place on record their appreciation for the valuable Services
rendered by them to the Company.
14. BOARD OF DIRECTORS, REMUNERATION POLICY AND THEIR MEETINGS
14.1 Number of meetings of the Board
The Board meets at regular intervals to discuss and decide on
Company/business policy and strategy apart from other Board business.
The notice of Board meeting is given well in advance to all the
Directors. Usually, meetings of the Board are held in Indore, at the
Head Office of the Company. The Agenda of the Board/Committee meetings
is circulated at least a week prior to the date of the meeting. The
Agenda for the Board and Committee meetings includes detailed notes on
the items to be discussed at the meeting to enable the Directors to
take an informed decision.
The Board met 4 (Four) times in financial year 2014-15 viz., on 30th
May, 2014,12thAugust, 2014,8th Nov., 2014 and 2nd Feb., 2015. The
maximum interval between any two meetings did not exceed 120 days.
14.2 Board independence
Our definition of 'Independence' of Directors is derived from Clause 49
of the Listing Agreement with Stock Exchanges and Section 149(6) of the
Companies Act, 2013. Based on the confirmation/ disclosures received
from the Directors and on evaluation of the relationships disclosed,
the following Non-Executive Directors are Independent in terms of
Clause 49 of the Listing Agreement and Section 149(6) of the Companies
Act, 2013:-
14.3 Company's policy on Directors' appointment and remuneration
The Policy of the Company on Directors' appointment and remuneration
including criteria for determining qualifications, positive attributes,
independence of a Director and other matters provided under sub-section
(3) of section 178, is appended as Annexure E to this Report and hosted
at the website of the Company at www.dnhindia.com.
14.4 Annual evaluation by the Board
The evaluation framework for assessing the performance of Directors
comprises of the following key areas:
i. Attendance of Board Meetings and Board Committee Meetings
ii. Quality of contribution to Board deliberations
iii. Strategic perspectives or inputs regarding future growth of
Company and its performance
iv. Providing perspectives and feedback going beyond information
provided by the management
v. Commitment to shareholder and other stakeholder interests
The evaluation involves Self-Evaluation by the Board Member and
subsequently assessment by the Board of Directors. Amember of the Board
will not participate in the discussion of his/her evaluation.
15. 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(5) of the Companies Act,
2013:
a. that in the preparation of the annual financial statements for the
year ended 31st March, 2015, the applicable accounting standards have
been followed along with proper explanation relating to material
departures;
b. that such accounting policies as mentioned in Note 2 of the Notes to
the Financial Statements have been selected and applied consistently
and judgments 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.
16. COMMITTEES OF THE BOARD
During the year, in accordance with the Companies Act, 2013, the Board
has the following five Committees as follows:
(a) Audit Committee
(b) Nomination and Remuneration Committee
(c) Stakeholders' Relationship Committee
(d) Risk management Committee
(e) Independent Director Committee
(f) Internal Committee for (Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal)Act, 2013 redressal of complaint
at the workplace
Details of all the Committees along with their charters, composition
and meetings held during the year, are provided in the "Report on
Corporate Governance", a part of this Annual Report.
17. 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 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. The transactions entered into are audited
and a statement giving details of all related party transactions is
placed before the Audit Committee and the Board of Directors for their
approval on a quarterly basis. The statement is supported by a
Certificate from the CEO & MD and the CFO. The Company has developed a
Related Party Transactions Manual, Standard Operating Procedures for
purpose of identification and monitoring of such transactions. The
particulars of the related party transactions have been given in the
FormAOC-2 and attached with this Report as an Annexure F.
The policy on Related Party Transactions as approved by the Board is
uploaded on the Company's website. A disclosure as required under
section 134(3)(h) of the Companies Act, 2013 and the Rule 8(2) of the
Companies (Accounts) Rules, 2014 being enclosed as Annexure F with the
Board's Report and hosted at the website of the
Companyatwww.dnhindia.com.
18. SIGNIFICANTAND 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.
19. AUDITORS
19.1 Statutory Auditors Appointment
The Company's Auditors, M/sABN & Co., Chartered Accountants, who were
appointed for a term of three years at the Annual General Meeting of
the Company held on 30th September, 2014 are eligible for ratification
of their appointment. They have confirmed their eligibility under
Section 141(3) (g) of the Companies Act, 2013 and the Rules framed
thereunder for ratification for appointment as Auditors of the Company.
As required under Clause 49 of the Listing Agreement, the auditors have
also confirmed that they hold a valid certificate issued by the Peer
Review Board of the Institute of Chartered Accountants of India.
Your Board is pleased to inform that there is no such observation made
by the Auditors in their report which needs any explanation by the
Board
19.2 Cost Auditors
Pursuant to Section 148 of the Companies Act, 2013 read with The
Companies (Cost Records and Audit) Amendment Rules, 2014, the cost
audit records maintained by the Company in respect of its manufacturing
activity is not required to be audited. But your Directors had, on the
recommendation of the Audit Committee, appointed M/s Vijay P. Joshi &
Associates, Cost Accountants audit the cost accounts of the Company for
the financial year 2014-15 on a remuneration of Rs. 45,000/-.
19.3 Secretarial Audit
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 M/s D K Jain & Co., a
firm of Company Secretaries in Practice to undertake the Secretarial
Audit of the Company. The Report of the Secretarial Audit Report is
annexed herewith as "Annexure B".
20. ENHANCING SHAREHOLDERS VALUE
Your Company believes that its Members are among its most important
stakeholders. Accordingly, your Company's operations are committed to
the pursuit of achieving high levels of operating performance and cost
competitiveness, consolidating and building for growth, enhancing the
productive asset and resource base and nurturing overall corporate
reputation. Your Company is also committed to creating value for its
other stakeholders by ensuring that its corporate actions positively
impact the socio-economic and environmental dimensions and contribute
to sustainable growth and development.
21. CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate section on corporate governance practices followed by the
Company, together with a certificate from the Company's Auditors
confirming compliance forms an integral part of this Report.
21.1. CEO & CFO certification
Certificate from Shri Harsh Vora, Managing Director and Mr. Sanat Kumar
Jain, Chief Financial Officer, pursuant to provisions of Clause 49(V)
of the Listing Agreement, for the year under review was placed before
the Board of Directors of the Company at its meeting held on 30th May,
2015.
A copy of the certificate on the financial statements for the financial
year ended March, 31,2015 is annexed along with this Report as Annexure
A.
22. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company prepared in
accordance with relevant Accounting Standards (AS) viz. AS 21, AS 23
and AS 27 issued by the Institute of Chartered Accountants of India
form part of this Annual Report.
23. 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 C".
24. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
OF THE COMPANY
There have been no material changes and commitments, if any, affecting
the financial position of the Company which have occurred between the
end of the financial year of the Company to which the financial
statements relate and the date of the report a copy of the annexure may
write to the Company Secretary at the Company's registered office.
25. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form
MGT-9 is annexed herewith as "Annexure D".
26. PARTICULARS OF REMUNERATION OF EMPLOYEES
The applicable information required pursuant to Section 197 of the
Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment
and Remuneration of Managerial Personnel), Rules 2014 in respect of the
employees are as under.
S. Name and Age Designation Remuneration
No. (Amount in Rs.)
1 Harsh Vora Managing 89,33,533/-
(53 Year) Director
2. Madhusudan Jain Whole Time 83,71,706/-
(49 Year) Director
S. Name and Age Qualification Experience
No. (in years)
1 Harsh Vora B.Com 30
(53 Year)
2. Madhusudan Jain Mechanical 25
(49 Year)
S. Name and Age Date of Previous
No. joining employment
1 Harsh Vora 06.12.1990 Nil
(53 Year)
2. Madhusudan Jain 24.01.2004 Nil
(49 Year) Engineer
The particulars of the remuneration to the directors pursuant to the
section 197(12) of the Companies Act, 2013 read with the Rule 5(1) of
the Companies (Appointment and Remuneration to the Managerial
Personnel) Rules 2014 are enclosed as Annexure E.
27. ACKNOWLEDGEMENTS
Your Directors thank the various Central and State Government
Departments, Organizations and Agencies for the continued help and
co-operation extended by them. The Directors also gratefully
acknowledge all stakeholders of the Company viz. customers, members,
dealers, vendors, banks and other business partners for the excellent
support received from them during the year. The Directors place on
record their sincere appreciation to all employees of the Company for
their unstinted commitment and continued contribution to the Company.
28. CAUTIONARY STATEMENT
Statements in the Board's Report and the Management Discussion &
Analysis describing the Company's objectives, expectations or forecasts
may be forward-looking within the meaning of applicable securities laws
and regulations.
Actual results may differ materially from those expressed in the
statement. Important factors that could influence the Company's
operations include global and domestic demand and supply conditions
affecting selling prices of finished goods, input availability and
prices, changes in government regulations, tax laws, economic
developments within the country and otherfactors such as litigation and
industrial relations.
For and on behalf of the Board
Place: Indore Harsh Vora SushilRawka
Date: 13lhAugust, 2015 Managing Director Director
DIN 00149287 DIN00156990
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