| Dear Shareholders
The Directors are delighted to present the 30th Annual Report of your
Company along with the audited statements for the year ended on 31st
March 2015.
PERFORMANCE HIGHLIGHTS
The financial results for the year ended on 31.03.2015 areas under:
(Rs. In Lacs)
PARTICULARS 2014-15 2013-14
Gross Income 74391.06 59966.23
Profit before Interest,
Depreciation and Tax 8598.69 7046.89
Less:
1) Interest 4298.73 2832.95
2) Depreciation 807.93 768.81
3) Provision for Tax
-Current Tax 990.00 1425.00
-Deferred Tax 86.48 47.54
4) Prior Period adjustments
Profit after Tax 3020.98 1972.59
Appropriation
Transfer to General Reserve 25.00 25.00
Proposed dividend and tax on
prop.
Dividend - 89.21
Earning per equity share 7,95 5.19
RESULTOFOPERATIONSANDTHESTATEOFCOMPANY'SAFFAIRS
Your Company has maintained its excellent pace of growth reflected by
the significant rise in Turnover. During the year under review, your
Company has recorded a turnover of Rs.743.92 Crores as against Rs.
599.66 Crores in the previous year registering an increase of 24.06%.
The Net profit (after tax and extra ordinary items) for the financial
year ended 31st March 2015 increased to Rs.30.21Crores from Rs. 19.73
Crores in the previous year representing an increase of 53.15%.
MATERIAL CHANGES & COMMITMENTS. IF ANY AFFECTING THE FINANCIAL POSITION
OF THE COMPANY:
There are no material changes and commitments affecting the financial
position ofyourCompany which haveoccurred between the end of
thefinancial year 2014-15 and the date of this Report.
BUSINESSOVERVIEW
The technical textiles sector being one of the most innovative branches
of the industry in the world is ranking as one the five high tech
sectors with the greatest potential for development. India is now
emerging as a powerhouse of both production as well as end- use
consumption of technical textiles. The demand for technical textiles
will be boosted by the changing economics cenario.
The success of technical textiles is primarily due to the creativity,
innovation and versatility in fibres, yarns and woven/ knitted
/nonwoven fabrics with applications spanning an enormous range of uses.
The ability of technical textiles to combine with each other and with
others to create a new functional products offer unlimited
opportunity to growth.
The production of different items of technical textile industry has
been slowly but steadily increasing in the country which is further
contributing in the growth of the industry as a whole.
Global Scenario:
Technical Textile is the sunrise segment of the global Textile
industry.
With increasing competition and diminishing margins in the production
of conventional textiles, textile manufacturers in industrialized
countries have switched over to production of value- added technical
textiles. As the use of technical textiles is dictated by need, its
pricing normally offers good margins. The Technical Textile industry is
estimated to account for over 50% of the total textile activity in
certain industrialized countries. While the US continues to be the main
manufacturers and consumers of functional textiles, China has emerged
as a large manufacturer of the same. India and Russia are the other
important markets for technical textiles, where
consumption is increasing at a fast pace.
The Indian Scenario:
India is emerging as a significant player in technical textiles. The
fast- paced economic growth leading to infrastructure creation as well
as higher disposable income has made India a key market for the
technical textile products. Moreover, the country has developed a
foothold in the production of technical textiles. Considering its
highly skilled and scientific/technical manpower and abundant
availability of raw materials, India can emerge as a key player in the
technical textiles industry.
India Textile Industry involves around 35 million workers directly and
accounts for 21% of the total employment generated in the economy, the
second largest provider of employment after agriculture. Thus,
Technical textiles holds significant potential in India and the
government has already taken steps to promote this industry. Indian
technical textile market is nascent and is quite honestly depending on
government's push and mandatory regulations to penetrate into different
sectors. The strong interest in the segment is driven by better profit
margins and less competition.
DIVIDEND:
The Board of Directors has not recommended any dividend duringthe
financial year in order to conserve and optimize use of resources
withintheCompanyformeetingitsfuture business requirements.
AMOUNTTRANSFERREDTO RESERVE:
The Company has transferred of Rs.25.00 Lacs in general reserve
account.
SHARE CAPITAL:
The paid up Equity Share Capital of the Company as at March 31,2015
stood at Rs. 38,02,21,980. Duringthe year under review, the Company has
not issued any shares with differential voting rights nor has granted
any stock options or sweat equity and not issued any warrants/GDR/ADR.
As on March 31, 2015, none of the Directors of the Company holds
instruments convertible into equity shares of the Company.
CONSOLIDATEDACCOUNTS
The consolidated financial statements of your Company for the financial
year 2014-15, are prepared in compliance with applicable provisions of
the Companies Act, 2013, Accounting Standards and Listing Agreement.
The consolidated financial statements have been prepared on the basis
of audited financial statements of the Company, its subsidiary, as
approved by their respective Board of Directors.
SUBSIDIARY COMPANIES
The consolidated financial results reflect the operations of the
Following subsidiaries: Europlast Limited, Sacos Indigo Private
limited, Netflix Infrasonic Limited, Poly Logic International Private
Limited, Prism Flexible Solutions Private Limited and Polybase (H.K.)
Limited.
-All these subsidiaries continue to work closely with the customers and
grow their business with product offerings relevant to their respective
markets. During the year, all the operating subsidiaries namely
Europlast Limited, Sacos Indigo Private limited, Neoflex Infracon
Limited and Poly Logic International Private Limited have improved
their financial performance over the previous year. The other two
subsidiaries namely Prism Flexible Solutions Private Limited and
Polybase (H.K.) Limited have not commenced commercial activities since
incorporation and currently are not operational.
The annual accounts of the subsidiaries and the related detailed
information will be kept open for inspection at the Registered Office
of the Company and that of the respective subsidiary companies. The
company will furnish a hard copy of details of accounts of subsidiaries
toany shareholder on demand.
During the year under review, no Company has become or ceased to be a
subsidiary of the Company. A statement containing the salient features
of the performance and financial position of the each of the subsidiary
companies is set out in the prescribed Form AOC.l attached to the
financial statements.
There are no associate companies/Joint Venture within the meaning of
section 2(6) of the Companies Act, 2015. There has been no material
change in the nature of the business of the subsidiary company.
DEPOSITS
During the year under review, your Company did not accept any deposits
within the earning of provisions of Chapter V- Acceptance of Deposits
by Companies of the Companies Act, 2013 read with the Companies
(Acceptance of Deposits) Rules, 2014.
DIRECTORSAND KEY MANAGERIAL PERSONNEL
At the ensuing Annual General Meeting, Mr. Utkarsh Trivedi, Director of
the Company, retires by rotation and being eligible offers himself for
re-appointment.
At the Annual General Meeting held on 30th September, 2014, Mr.
Shrawan K Patodi, Mr. Ladharam Patel, Mr. Rolland Codderre and Mrs.
Shobha Dube were appointed as Independent Directors of the Company
pursuant to section 149 of the Companies Act, 2013 for a term of five
consecutive years. None of the Independent Directors are due for
re-appointment.
The Independent Directors of the Company have declared that they meet
the criteria of Independence in terms of Section 149(6) of the
Companies Act, 2013 and that there is no change in their status of
Independence.
At the Board Meeting held on November 14, 2014, Ms. Jyoti Dubey was
appointed as Chief Financial Officer of the Company. Further Mr. Sunil
K. Trivedi (Chairman & Managing Director), Ms. Jyoti Dubey (CFO) and
Ms. Swati Gangrade (Company Secretary) were designated as "Key
Managerial Personnel" of the Company pursuant to Sections 2(51) and 203
of the Companies Act, 2013 read with the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014
DISQUAUFICATIONSOF DIRECTORS
During the year under review, declarations received from all the
Directors of the Company pursuant to Section 164 of the Companies Act,
2013. The Board appraised the same and found that none of the director
is disqualified for holding office as director as per the provisions of
the Companies Act, 2013.
DIRECTORS'RESPONSIBILITY STATEMENT
In terms of section 134(3)(C) of the Companies Act,2013, your Directors
state that:
a) in the preparation of the annual accounts for the year ended March
31, 2015, the applicable accounting standards read with requirements
set out under Schedule III to the Act, have been followed and there are
no material departures from the same;
b) the Directors 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 as at March 31, 2015 and of the profit of the Company
for the year ended on that date;
c) the Directors 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) the Directors have prepared the annual accounts on a 'going concern
'basis;
e) the Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance
with the provisions of all applicable laws and that such systems are
adequate and operating effectively.
BOARDMEETINGSANDANNUALGENERALMEETING
During the financial year, meeting of the Board of the Directors of the
Company were held seventeen times. The gap between two meetings did not
exceed one hundred and twenty days. Further Annual General Meeting was
held on 30th September, 2014. Detailed information on the meetings of
the Board, its Committee and the AGM is included in the Report on
Corporate Governance, which forms part of this Annual Report.
COMMITTEESOF BOARD OF DIRECTORS
The Company has various committees which have been constituted as a
part of the good corporate governance practices and the same are in
compliance with the requirements of the relevant provisions of
applicable laws and statutes. The Committees of the Board are:
(i) Audit Committee
(ii) Nomination and Remuneration Committee
(iii) Stakeholders' Relationship Committee
(iv)CSR Committee
(v) Management Committee
The details with respect to the composition, powers, roles, terms of
reference, meetings held and attendance of the Directors at such
Meetings of the relevant Committees are given in detail in the Report
on Corporate Governance of the Company which forms part of this Annual
Report.
EVALUATION OF BOARD EFFECTIVENESS
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement with the stock exchanges, the Board has carried
out an annual performance evaluation of its own performance, and of the
directors individually, as well as the evaluation of the working of its
Audit, Nomination & Remuneration and Compliance Committees. The result
of the evaluation is satisfactory and adequate and meets the
requirement of the Company.
-RELATED PARTIES TRANSACTIONS
All transactions entered by the Company during the financial year with
related parties were in the ordinary course of business and on an arm's
length basis and that the provisions of section 188 of Companies Act,
2013 are not attracted. During the year under review, there are no
material related party transactions.
All related party transactions are placed before the Audit Committee as
also to the Board for approval. The policy on Related Party
Transactions has been approved by the Board of Directors. Details of
contracts/arrangements/transactions with related parties are given in
the Note 29 to the Standalone Financial Statements.
PARTICULARSOFLOANS.GUARANTEESORINVESTMENTS
Amount out standing as at 31st March 2015 (Rs.inLacs)
Particulars Amount
Loans given NIL
Guarantee given 22016.00
moment made 8776.51
Loan, Guarantee and Investment made duringthe FY2014-2015
(Rs.in Lacs)
Name of Relation Amount Loan/ Purpose
Entity guarantee/
investment
Sacos
Indigo Subsi- 2146.00 Guarantee For availing
Pvt.Ltd. diary given credit
facilities
from Banks
Poly
Logic Subsi- 5800.00 Guarantee For availing
Interna-
tional diary given credit
Pvt. Ltd. facilities
from Banks
Poly
Logic Subsi- 2688.99 Investment Investment
Intern-
ational diary
Pvt. Ltd.
EXTRACTOFANNUALRETURN
lln accordance with Section 134(3)(a) and Section 92(3) of the
Companies Act, 2013, An extract of Annual Return in Form MGT-9 as on
March31,2015isattachedasAnnexure-ltothis Report.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has a vigil mechanism to deal with instance of fraud and
mismanagement, if any. The details of the Vigil Mechanism Policy is
explained in the 'Corporate Governance Report' which and forms part of
this Report and also displayed on the website of the Company
(www.neocorp.co.in).
REMUNERATION POUCYOF THECOMPANY
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Key Managerial Personnel and Senior Executives of the Company including
criteria for determining qualifications, positive attributes,
independence of a Director, remuneration and other related matters.
Details of policy covering these requirement has disclosed in Corporate
Governance Report.
PARTICULARSOF EMPLOYEES
None of the employee of the company is drawing more than Rs.
60,00,000/- per annum or Rs.5,00,000/- per month for the part of the
year, during the year under review therefore Particulars of the
employees as required under Section 197 of Companies Act, 2013 read
with rule 5 (2) & rule 5 (3) of Companies (appointment and
remuneration) Rules 2014 are not applicable, during the year under
review.
Ratio of remuneration of each director to the median remuneration of
the employees of the Company for the Financial Year:
Statement pursuant to Section 197(12) of the Companies Act 2013 and
rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, forms part of this report as Annexure4.
CORPORATE SOCIAL RESPONSIBILITY CSR) INITIATIVES
Pursuant to Section 135 of the Companies Act, 2013 read with the
Companies (Corporate Social Responsibility Policy) Rules, 2014, the
Board of Directors have approved a Policy on CSR and the Policy is
hosted on the website of the Company www.neocorp.co.in.
As a part of CSR initiatives, Your Company during the financial year
2014-15 has amongst other activities, undertaken projects in areas of
promoting education, preventive health care, empowering women and
measures for welfare of other backward class. These projects are in
accordance with Schedule VII of the Companies Act, 2013. The Company
has undertaken CSR activities through registered trust or registered
society and other permissible entities by giving donations and
contributions to various permitted entities. The Company has also
undertaken CSR initiatives on its own and has started with the
play-group and nursery 'ShishuVihar" nearby factory premises at
Pithampur for poor children education at free of cost.
The Company formed a Corporate Social Responsibility Committee to
implement and monitor the CSR policy. A lot of activities were taken up
and implemented during the year, particulars of which are given in this
report. However, some of the projects envisaged could not take off
during the year. Hence there is a shortfall in CSR amount spent
compared to the amount prescribed to be spent.
The report on CSR activities is attached as Annexure-Z to this Report.
RISKANDAREASOFCONCERN
The Company has laid down a well-defined risk management mechanism
covering the risk mapping and trend analysis, risk exposure, potential
impact and risk mitigation process. The Board periodically reviews the
risks and suggests steps to be taken to control and mitigate the same
through a properly defined framework. Details on the risk elements
which the Company is exposed to are covered in the Management
Discussion and Analysis Report which forms part of this Report. In line
with the new regulatory requirements, the Company has formally framed a
Risk Management Policy to identify and assess the key risk areas,
monitor and report compliance and effectiveness of the policy and
procedure.
STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLWITH
REFERENCETOTHE FINANCIAL STATEMENTS
The company has an effective internal control and risk mitigation
system, which are constantly assessed and strengthened with new or
revised standard operating procedures. The company's internal control
system is commensurate with its size, scale and complexities of its
operations. The details are mentioned in the Management Discussion and
Analysis Report which forms part of this Report.
PREVENTIONOFSEXUALHARASSMENTATWORKPLACE
The Company has been employing women employees in various cadres within
its office and factory premises. The Company has in place a policy
against Sexual Harassment in line with the -requirements of the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013. It ensures prevention and deterrence towards the
commissioning of acts of sexual harassment and communicates procedures
for their resolution and settlement.
Internal Complaint Committees are set up at shop floor level to redress
any complaints received and are monitored by women line supervisors.
All employees are covered under the policy. There was no complaint
received from any employee during the financial year 2014-15 and hence
no complaint is outstanding as on 31.03.2015 for redressal.
INSURANCECLAIM
A fire broke out in TECHTEXTIL, the EOU division of NCIL situated at
Pithampur, on 27th February at midnight, 2010 bringing a loss to plant,
machinery, stock in process and finished stock. The inferno which
caused damaged was insured under various policies taken from United
India Insurance Company Limited and Oriental Insurance Company Limited.
The total claim launched was to the tune of INR 52.05 crores. The
company has received the claim of INR 39.43 Crores During the earlier
years. The company has filed arbitration against the assessment of
claim of Rs. 4.88 Crores. The Company is hopeful to receive the said
amount.
AUDITORS
Pursuant to the provisions of section 139 of the Companies Act, 2013
M/s. A.P. Garg & Co., Chartered Accountants (Firm Registration No.
002143C) statutory auditors of the company were appointed as auditor to
hold office up to the conclusion of 30th Annual General Meeting of the
company and are recommended for re-appointment to audit the accounts of
the company up to the conclusion of 34th AGM of the Company to be held
in year 2019, subject to ratification of their appointment by members
at every AGM held thereafter. A resolution for appointment of M/s. A.P.
Garg & Co., Chartered Accountants, as auditors for the period from the
conclusion of the ensuing 30th AGM till the conclusion of the 34th AGM
and for fixation of their remuneration for the year 2015-16 is being
proposed in the notice of the ensuing AGM for the approval of the
members. The Company has received from M/s. A.P. Garg & Co., Chartered
Accountant a written consent for ratification of their appointment from
the conclusion of the 30th AGM till the conclusion of the 34th AGM and
a certificate to the effect that their appointment shall be in
accordance with the prescribed conditions and that the firm is not
disqualified under the Companies Act, 2013.
SECRETARIALAUDIT
Pursuant to Section 204 of the Companies Act, 2013 the Board of
Directors had appointed M/s. Ashish Karodia & Co., Practicing Company
Secretary (C. P. No. 6375) as Secretarial Auditor to undertake the
Secretarial Audit of the Company.
The report of the Secretarial Auditor is annexed herewith as Annexure 3
and forms part of this Report.
AUDITORS'REPORT/SECRETARIALAUDITREPORT
Report of the auditors and their observations and notes to the accounts
of the company for the year under review are attached herewith which
are self-explanatory and do not require further explanation.
Further there was no fraud in the Company, which was required to report
by statutory auditors of the Company under sub-section (12) of
sectionl43of Companies Act, 2013.
CORPORATE GOVERNANCE
Your Company has complied with the Corporate Governance requirements as
per the revised Clause 49 of the Listing Agreement with the stock
exchanges. A separate report on Corporate Governance along with a
Certificate of Compliance from Practicing Company Secretary forms a
part of this Annual Report.
LISTING OF THESHARES
The shares of the Company are listed on the Bombay Stock Exchange
Limited and Luxembourg Stock Exchange.
CODEOFCONDUCT
The Company has laid down a code of conduct for all Board members and
senior management and independent directors of the Company. All the
Board members including independent directors and senior management
personnel have affirmed compliance with the code of conduct. The policy
on Code of Conduct has been uploaded on the Company's website at the
www.neocorp.co.in
REPORTON MANAGEMENT AND DISCUSSION ANALYSIS
A detailed analysis of the Company's performance is discussed in the
Management Discussion and Analysis Report, which forms part of this
Annual Report.
ACKNOWLEDGEMENT
Your Directors provide their gratitude to the various Government
Agencies, Banks and financial institutions, investors, Company's
business associates, customers, dealers, suppliers and other service
providers for their continued support. Your Directors place on record
their sincere appreciation of the contributions made by the employees
of the Company and its subsidiaries at all level through their hard
work, dedication and support in ensuring an excellent all around
operational performance. The Board is also deeply grateful to the
shareholders for the confidence and faith that has been reposed in
them. Driven by values and powered by internal vitality, the entire
"NCIL Group" stands committed to create an even brighter future for All
the stakeholders.
For and on behalf of the Board of Directors
SUNILK.TRIVEDI
Date: 30th May, 2015 Chairman & Managing Director
Place: Indore (DIN No. 00053000) |