The Directors have pleasure in presenting herewith the 34th Annual Report together with the Audited Statement of Accounts for the year ended on 31st March, 2018.
FINANCIAL HIGHLIGHTS:
(Rs. in Lacs)
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Particulars
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Year ended on 31-03-2018
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Previous year ended on 31-03-2017
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|
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(a) Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
(b) Finance Cost
(c) Depreciation and amortization expenses
(d) Profit before Tax
(e) Tax Expenses
(a) Current Tax
(b) Deferred Tax
Total Tax Expenses
(f) Profit for the year
(g) Other Comprehensive income :
A (i) Item that will not be reclassified to profit or loss Remeasurement of defined benefit plans
(ii) Income tax relating to items that will not be reclassified to profit or loss
Other Comprehensive Income for the year :
(h) Total Comprehensive income for the year :
|
1522.19
1598.38
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5344.32
3120.57
2223.75
739.22
1484.53
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1596.99
1483.34
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5757.90
3080.33
2677.57
1014.38
1663.19
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|
|
608.05
131.17
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939.57
74.81
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|
| |
|
|
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(28.35)
9.81
(18.54)
1465.99
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(45.49)
15.74
(29.75)
1633.44
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|
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|
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STATE OF COMPANY’S AFFAIRS:
The Company has earned Revenue from Operations of Rs.52304.47 Lacs during the year ended on 31st March, 2018 as against Rs.48438.10 Lacs earned during the previous year ended on 31st March, 2017 giving a rise of 7.98% as compared to previous year.
After adding thereto the other income of Rs.453.04 Lacs earned by the Company, the Company has earned total income of Rs.52757.51 Lacs during the year under review. The Company has incurred total expenses of Rs.50533.76 Lacs including Finance cost of Rs.1522.19 Lacs and Depreciation and Amortization expenses of Rs.1598.38 Lacs, during the year under review.
The Company has earned profit before Tax of Rs.2223.75 Lacs during the year under review as compared to Profit Rs.2677.57 Lacs incurred during the previous year ended on 31st March, 2017. The Company has earned profit for the year of Rs.1484.53 Lacs during the year ended on 31st March, 2018 after deducting Current Tax of Rs.608.05 Lacs and Deferred Tax of Rs.131.17 Lacs, as compared to Profit of Rs.1663.19 Lacs incurred by the Company during the previous year ended on 31st March, 2017.
DIVIDEND :
The Directors have recommended dividend of Rs.1.25 per share (@12.50%) on 71,87,830 Equity Shares of Rs.10/- each of the Company for the Financial Year ended on 31st March, 2018 as compared to Dividend of Rs.1.25 per share (@10.25%) declared for the previous Financial Year ended on 31st March, 2017. If approved, the dividend will be paid without deduction of tax at source to the shareholders.
TRANSFER TO RESERVE :
The Company does not propose to transfer any amount to the General Reserve during the year under review.
EXTRACT OF ANNUAL RETURN:
Extract of Annual Return of the Company as required under Section 92(3) of the Act and Rule - 12 of the Companies (Management and Administration) Rules, 2014, in the prescribed Form - MGT-9, is annexed herewith as Annexure - A, to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS:
Management Discussion and Analysis Report has been enclosed herewith as per Annexure - B and forming part of the Directors’ Report.
QUALITY ASSURANCE AND AWARDS
AWARDS AND CERTIFICATIONS:
Vadilal has won 27 awards over 4 consecutive years: 2008 to 2011 at 'The Great Indian Ice Cream Contest' organized by the Indian Dairy Association. The various categories for awards were: The Best in Class (3): Chocolate Frozen Dessert, Standard Chocolate Ice Cream, Rose Coconut Shell (Innovation - Novelty), Gold Medal (4): Standard Chocolate Ice Cream, Chocolate Frozen Dessert, Vanilla Frozen Dessert and Rose Coconut Shell (Innovation - Novelty), Bronze Medal (1): Natural Orange (Premium without Inclusion). Best in Class in Kids category - Joker Ice Trooper, Gold in Kids category - Joker Face Ice Trooper, Silver in Vanilla Frozen Dessert, Bronze in Vanilla Ice Cream - Happinezz Vanilla Ice cream, Bronze in Premium - Pista Happinezz Ice Cream garnished with Green Pista.
Vadilal Ice Creams has been voted as the “Most Trusted Ice Cream Brand in India” as per The Brand Trust Report - 2013. The Economic Times Survey ranked us among the “Top 20 Food and Beverages” brands in India.
ISO 22000:2005 AND ISO 9001:2008 CERTIFICATES
The Company has always made continuous efforts to improve the “OVERALL PRODUCT QUALITY” by following the stringent GMP norms and continuous process innovation. This is evident with the achievement of FSMS (Food Safety Management System) Certifications i.e. BRC: Issue-6 with Grade “A”, ISO-22000:2005 and HALAL for our Processed Food Division (PFD), located at Dharampur, Dist. Valsad, Gujarat.
The PFD Manufacturing facility is also listed in “Two Star Export House” Status by Joint Director General of Foreign Trade, Ministry of Commerce and Industry for export of Processed Foods Products-APEDA.
The Ice Cream plants of the Company located in two locations - Pundhra in Gujarat & Barelly in UP are also certified for ISO-22000:2005, ISO 9001:2008 and BRC: Issue 6 for Food Safety Management System is another feather in the cap for the Company.
FINANCE:
During the year under review, the company has raised Rs.60.00 Crore from Indusind Bank without personal guarantee of promoters as Long Term Borrowing, with low rate of Interest, to replace Short Term Borrowing, to avoid mismatch of long term fund v/s long term assets. It has improved various financial parameters including current ratio.
The Company has availed Unsecured Working Capital Loan of ' 10.00 crores from HDFC Bank for the period of 6 months, for procurement of raw materials, in winter season.
The Company has also availed finance from American Express Banking Corporation for ' 13.45 crores, as a Corporate Credit Card facility for Vendor payment.
During the year company has made regular repayment of Loan & interest thereon and there is no any overdue payment to Banks and FIs. During the year, the Banks have also reduced the Rate of Interest and the Company has upgraded external rating from BBB (Stable) to BBB (Plus).
During the financial year - 2017-2018, the Company has deposited unclaimed/ unpaid fixed deposit amount of ' 37595/- to Investor Education and Protection Fund - IEPF.
During the Financial year - 2017-2018, the Company has also transferred ' 46403/- being amount of unpaid dividend for the year - 2009-2010 to Investor Education and Protection Fund.
DETAILS OF DEPOSITS:
a. During the year under review, the details of deposits accepted by the Company from its Members, after complying with the provisions of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014, are as under :
i. Details of Deposit from Shareholders : (Rs. in Lacs)
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(a) Amount of existing deposits as at 1st April, 2017
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:
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1764.90
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(b) Amount of deposits accepted or renewed during the year
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(i) Secured deposits
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:
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0
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|
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(ii) Unsecured deposits
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:
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1586.15
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Total (b) :
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:
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1586.15
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(c) Amount of deposits repaid during the year
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:
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613.42
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(d) Balance of deposits outstanding at the end of the year (a b-c)
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2737.63
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ii. Details of Deposit from Public [Accepted under Companies Act, 1956 and Companies (Acceptance of Deposit) Rules, 1975] :
(Rs. in Lacs)
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(a) Amount of existing deposits as at 1st April, 2017
|
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0.15
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(b) Amount of deposits accepted or renewed during the year
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(i) Secured deposits
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0
|
|
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(ii) Unsecured deposits
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|
0
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|
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Total (b) :
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0
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(c) Amount of deposits repaid during the year
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|
0
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(d) Balance of deposits outstanding at the end of the year (a b-c)
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0.15
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b. As on 31st March, 2018, deposits of ' 15000/- was remained unpaid or unclaimed by the Company.
c. During the year under review, the Company has not made any default in repayment of deposits or payment of interest on deposits.
d. The Company has not accepted or renewed any deposit which is not in compliance with the provisions of Chapter - V of the Companies Act, 2013.
SUBSIDIARY COMPANY:
The Company is having a wholly-owned subsidiary company namely Vadilal Industries (USA) Inc., USA.
During the year under review, the company has incorporated a new subsidiary company in United Arab Emirates in the name of VADILAL GULF (FZE) on 20-02-2018. The company has also incorporated a new subsidiary company in Australia in the name of Vadilal Industries Pty Ltd, on 16-04-2018. However, the Company has not made any investment in the securities of the said companies yet.
A report on the financial position of the subsidiary and associate as per first proviso to sub-section(3) of Section 129 of the Companies Act, 2013 and Rules made thereunder in the prescribed Form - AOC-1 is provided as Annexure - C to the Directors' Report. The Policy for determining material subsidiaries may be accessed on the Company's website viz www.vadilalgroup.com.
Pursuant to the provisions of Section 136 of the Act, separate Audited Accounts in respect of subsidiary company for the year ended on 31st March, 2018 are available at the web-site of the Company viz. www.vadilalgroup.com.
CONSOLIDATED FINANCIAL STATEMENTS:
Pursuant to the requirements of Section 129(3) read with Schedule - III of the Companies Act, 2013 and Rules made thereunder, and Regulation 34 of the SEBI (Listing Obligation and Disclosure Requirement), 2015 and other applicable Accounting Standards, the Consolidated Financial Statements of the Company, its subsidiaries and associates, for the year ended on 31st March, 2018 have been attached with the financial statement of the Company. The Audited Consolidated Financial Statements form part of the Annual Report.
CORPORATE GOVERNANCE:
Being a Listed Company, the Company has taken necessary measures to comply with the provisions of Chapter-IV of SEBI (Listing Obligation and Disclosure Requirement), 2015 regarding Corporate Governance. A separate report on Corporate Governance for the year ended on 31st March, 2018 is attached herewith as a part of this Annual Report viz Annexure - D. A certificate from Statutory Auditors of the Company regarding compliance of Corporate Governance as stipulated under Regulation 34(3) and 53(f) of SEBI (Listing Obligation and Disclosure Requirement), 2015 is obtained by the Company and annexed to the Corporate Governance Report.
DIRECTORS’ RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the confirmation and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(C) and 134(5) of the Companies Act, 2013 and confirm :
(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) The directors had 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 of the company for that period;
(c) The directors had 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) The directors had prepared the annual accounts on a going concern basis;
(e) The directors had 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) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED:
Particulars of loans given, investments made, guarantees given and securities provided by the Company under Section 186 of the Companies Act, 2013 forms part of the Notes to the financial statements provided in this Annual Report.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:
Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure - E in the prescribed Form - AOC-2 and the same forms part of this report. All related party transactions are placed before the Audit Committee of the Company for review and approval.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company's website viz. www.vadilalgroup.com.
Your Directors draw attention of the members to Note - 46 to the financial statement which sets out related party disclosures.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Rules made thereunder, Mr. Rajesh R. Gandhi, Managing Director (DIN: 00009879) of the Company, shall retire by rotation at this Annual General Meeting and being eligible, offer himself for re-appointment. The retiring by rotation of Mr. Rajesh R. Gandhi, as aforesaid and his re-appointment shall not be termed as discontinuation in his office as Managing Director of the Company. The Members are requested to consider his re-appointment as Director of the Company, for which necessary resolution has been incorporated in the notice of the meeting.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Rules made thereunder, Mrs. Deval D. Gandhi (DIN: 00988905) of the Company shall retire by rotation at this Annual General Meeting and being eligible, offer herself for re-appointment The Members are requested to consider her re-appointment as Director of the Company, for which necessary resolution has been incorporated in the notice of the meeting.
The brief resume/details relating to the said Directors, who are to be re-appointed are furnished in the Notes to the Notice of the Annual General Meeting.
BOARD EVALUATION:
The board of directors has carried out an annual evaluation of its own performance, Board committees and individual independent directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed under Regulation 17 of SEBI (Listing Obligation and Disclosure Requirement), 2015.
The performance of the Board and committees were evaluated by the Board on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc.
The Board and the Nomination and Remuneration Committee (“NRC”) reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed.
COMMITTEES OF DIRECTORS:
The details of various committees of Directors constituted under various provisions of Companies Act, 2013 and Rules made thereunder, their constitution, terms of reference and other details are provided in the Corporate Governance Report annexed with the Directors' Report.
POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION:
The Policy on appointment and remuneration of Directors as approved by the Board of Directors is enclosed with the Directors' report and marked as Annexure - F
OTHER POLICIES AND MEASURES AS PER THE REQUIREMENT OF SEBI (LISTING OBLIGATION AND DISCLOSURE REQUIREMENT), 2015
The policies formulated by the Company under various provisions of Companies Act, 2013 and SEBI (Listing Obligation and Disclosure Requirement), 2015 are available on the website of the Company viz : www.vadilalgroup.com.
NUMBER OF BOARD MEETINGS:
During the year under review, 9 Meetings of Board of Directors and one adjourned Board Meeting were held the details of which are mentioned in the Corporate Governance Report annexed with the Directors' Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
As required under Section 134(1)(m) of the Companies Act, 2013 and Rules made thereunder, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure - G attached herewith and forming part of the Directors' Report.
RISK MANAGEMENT:
The Company is exposed to various business risks from time to time. Risk management involves handling appropriately risks that are likely to harm an organization. There are various types of risks associated with conducting business of the Company. The ultimate goal of risk management is the preservation of physical and human assets of the organization for successful continuation of its operations.
In view of the same and in terms of requirements of the Regulation 17 of SEBI (Listing Obligation and Disclosure Requirement), 2015 regarding Corporate Governance, the Board of Directors had, approved the risk assessment and minimization procedure adopted by the Company in relation to its business.
The Board periodically reviews the risk assessment and minimization procedure in relation to the business of the Company. CORPORATE SOCIAL RESPONSIBILITY:
In terms of provisions of Section 135 of the Companies Act, 2013 and Rules made thereunder, a committee of the Directors of the Company has been constituted as Corporate Social Responsibility Committee. The Corporate Social Responsibility Committee has formulated a policy on the Corporate Social Responsibility measures to be undertaken by the Company as specified in Schedule VII to the Companies Act, 2013.
The Corporate Social Responsibility Policy is available on the Company's web-site viz. www.vadilalgroup.com.
The Annual Report on CSR activities is annexed herewith marked as Annexure - H.
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 were observed.
AUDITORS:
In accordance with Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors of the Company were appointed as Statutory Auditors of the Company at the 33rd Annual General Meeting of the Members of the Company held on Friday, 29th September, 2017 for a period of 5 years from the conclusion of the 33rd Annual General Meeting till the conclusion of 38th Annual General Meeting of the Company to be held in the year 2022, subject to ratification of their appointment by the Members at every Annual General Meeting till the 38th Annual General Meeting.
The Board of Directors has, on recommendation of Audit Committee, recommended to the Members about the ratification of appointment of M/s Deloitte Haskins & Sells LLP, Chartered Accountants, as Statutory Auditors of the Company
The Consent and certificate u/s 139 of the Companies Act, 2013 have been obtained from M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, to the effect that their appointment, if made, shall be in accordance with the applicable provisions of the Act and the Rules issued thereunder.
COST ACCOUNTING RECORDS :
The provisions of Section 148 of the Companies Act, 2013 are not applicable to the Company and hence, the Company does not maintain Cost Accounting records.
AUDITORS’ REPORT OF THE COMPANY:
The Auditors' Report on the Annual Accounts of the Company for the year ended on 31st March, 2018 does not contain any qualification / reservation / observation or negative remark.
SECRETARIAL AUDITOR:
Section 204 of the Companies Act, 2013 inter alia requires every listed companies to annex with its Board Report a Secretarial Audit Report given by a Company Secretary in practice in the prescribed form. The Board has appointed M/s SPAN & Co., Company Secretaries LLP, to conduct Secretarial Audit for the financial year - 2017-2018. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith marked as Annexure - I to this Report.
The explanation to the observation made in the Secretarial Audit Report is Provided in Annual Report on CSR Activities as per Annexure-H to the report.
INSURANCE:
All insurable interests of the Company including buildings, plant and machinery, furniture & fixtures and other insurable interest are adequately insured.
LISTING WITH STOCK EXCHANGES:
The Equity Shares of the Company are listed on the BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE).
The Company confirms that it has paid Annual Listing Fees due to the BSE Limited and National Stock Exchange of India Limited upto the Financial Year -2018-2019.
PARTICULARS OF EMPLOYEES:
The Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are enclosed with this report as Annexure - J.
The Statement of particulars of employees under Section 197(12) read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is not provided with as, during the financial year under review, apart from the Managing Directors, no employee of the Company was in receipt of remuneration in excess of the limits set out in the said rules. The details of remuneration paid to the Managing Directors are already provided in the report.
MATERIAL INFORMATION :
During the period under review, a Company Petition (being Company Petition No. 42 of 2017) has been filed against the Company, before the National Company Law Tribunal, Ahmedabad (“NCLT”), under Sections 241 and 242 of the Companies Act, 2013. In connection to the said Company Petition No. 42 of 2017, the Petitioners and some of the parties to the petition are seeking to arrive at an amicable resolution of matter. The matter was lastly heard by the Hon'ble NCLT on 27-07-2018.
GENERAL:
- During the year under review, there was no change in the nature of business of the Company and there is no material change and/or commitments, affecting the financial position of the Company, during the period from 31st March, 2018 till the date of this report.
- During the year under review, there was no significant and/or material order passed by any regulators or courts or tribunals impacting the going concern status and company's operations in future.
- The Company does not provide any loan or other financial arrangement to its employees or Directors or Key Managerial Personnel for purchase of its own shares and hence, the disclosure under Section 67(3)(c) of the Companies Act, 2013 does not require.
- During the year under review, no Director or Managing Director of the Company has received any remuneration or commission from subsidiary of the Company in terms of provisions of Section 197(14) of the Companies Act, 2013.
- The disclosure in terms of Rule - 4 of Companies (Share Capital and Debenture) Rules, 2014 is not provided, as the Company does not have any equity shares with differential voting rights.
- The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. The Company has also organized an awareness program for its employees on the said policy on prevention, prohibition and redressal of sexual harassment at workplace adopted by the Company
- The trademark “Vadilal” and its associated trademarks are owned by Vadilal International Pvt. Ltd. The Company is a licensee of the said Trademarks.
ACKNOWLEDGEMENT:
The Directors place on record the appreciation and gratitude for the co-operation and assistance extended by various departments of the Union Government, State Government, Bankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere services of the employees of the Company at al levels.
The Company will make every effort to meet the aspirations of its Shareholders and wish to sincerely thank them for their whole hearted co-operation and support at all times.
By order of the Board of Directors
Date : 11th August, 2018 RAJESH R. GANDHI
Place : Ahmedabad Chairman and Managing Director
DIN : 00009879
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