| The Board of Directors of your Company has pleasure in presenting the
29th Annual Report of the Company together with the Audited statements
of accounts for the year ended on 31st March 2015.
1. Financial summary or highlights / Performance of the Company
(Standalone and Consolidated):
Your Company's financial summary / performance during the year under
review as compared to the previous year are summarized below.
(Rs, in Crores)
Particulars 2014 - 2015 2013 - 2014
Turnover 8.62 8.45
Profit/(Loss) before Finance
charges, Tax, Depreciation /
Amortization (2.08) 3.20
Finance Charges 1.71 1.73
Profit/(Loss) before Tax,
Depreciation / Amortization (3.79) 1.46
Depreciation 2.09 1.34
Profit/(Loss) before Tax (5.88) 0.12
Provision for Tax Nil 0.02
Profit/(Loss) after Tax (5.88) 0.10
Proposed Dividend Nil Nil
On the basis of consolidated financial statements, financial summary /
performance of the Group is summarized below:
(Rs, in Crores)
Particulars 2014 - 2015 2013 - 2014
Turnover 8.67 9.07
Profit/(Loss) before
Finance charges, Tax,
Depreciation / Amortization 1.72 1.53
Finance Charges 2.28 2.23
Profit/(Loss) before Tax,
Depreciation / Amortization (0.56) (0.70)
Depreciation 2.63 1.95
Profit/(Loss) before Tax (3.19) (2.65)
Provision for Tax (8.73) 0.02
Profit/(Loss) after Tax (3.10) (2.67)
Minority Interest (0.16) (0.77)
Profit/(Loss) for the year (2.94) (1.89)
Proposed Dividend Nil Nil
2. Dividend:
In view of the losses, the Board of Directors does not recommend any
dividend for the year ended on 31st March 2015.
3. Reserves:
No amount is proposed to be transferred to the Reserves.
4. State of Affairs (Standalone and Consolidated):
The turnover of the Company has increased marginally during the year.
However, operating margins were under pressure. The Company has
suffered losses due to increase in the cost of input, finance costs and
other expenses.
The occupancy rate and Average Room Revenue (ARR) remained stagnant due
to general economic slowdown.
Paucity of funds affected the performance of the whole Group. The
subsidiaries were non - operational during most of the year due to
acute shortage of working capital. The subsidiaries have suffered
losses.
Finance
The shortage of finance remained a major concern during the year. The
parent company was not able to extend its helping hand due to its own
problems.
The management is striving hard to arrange funds for repayment of debt
and working capital necessary for smooth running of the operations.
Current Year Prospects
The fortune of the hospitality industry has always been linked to the
prospects of the tourism industry and general economic growth. On both
fronts, the current year seems to be positive. Barring unforeseen
difficulties, the Hotel is expected to continue on its path of steady
growth. However, due to stagnant ARR, margins are likely to remain
under pressure.
As mentioned earlier, shortage of finance remains a major factor
affecting the performance of the Company.
During the first quarter of the current year, the F&B segment suffered
a set-back due to general economic slow-down and severe draught in the
region.
5. Change(s) in the nature of business, if any:
There is no change in the nature of business of the Company.
6. 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:
Nil. No such material changes and commitments have occurred.
7. Details of significant and material orders passed by the regulators
/ courts / tribunals impacting the going concern status and the
Company's operations in future:
Nil. No such orders are passed.
8. Statement in respect of adequacy of internal financial controls
with reference to the Financial Statements:
Internal Financial controls are adequate commensurate with the size,
nature of operations of the Company. 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 statements.
9. Details of Subsidiary / Associate Companies / Joint Ventures:
Dhanada Engineering Private Limited, Dhanada Education Private Limited
and Dhanada Clean Energy (India) Private Limited are subsidiaries of
the Company. The Company has no Associate Company / Joint Venture.
The Company has formulated policy for determining Material
Subsidiaries. The said policy is available on the website of the
Company. A web link thereto is
http://www.dhanadacorp.com/pdf/Policy_for_deteriming_
Material_Subsidiary.pdf.
A statement containing the salient features of the financial statement
of subsidiaries in Form No. AOC-1 is attached as Annexure 1 to the
Directors' Report.
The Consolidated financial statements, prepared in accordance with
Section 129(3) of the Companies Act, 2013 and listing agreement, form
part of the Annual Report.
Further, in accordance with Section 136 of the Companies Act, 2013, the
audited financial statements including consolidated financial
statements and all other documents required to be attached thereto and
audited accounts of subsidiaries are available on the website of the
Company www.dhanadacorp.com.
10. Performance and financial position of each of the subsidiaries
included in the consolidated financial statement:
Dhanada Engineering Private Limited, a Company engaged in manufacture
of press parts for automobile industry, is a subsidiary of your
Company.
Dhanada Education Private Limited, a Company engaged in the business of
providing education and training, is a subsidiary of your Company.
Both the aforesaid subsidiaries were non - operational during most of
the year. They have suffered losses. This was due to acute shortage of
working capital.
Dhanada Clean Energy (India) Private Limited, a Company engaged in
manufacture and selling of wind power driven turbines, is a subsidiary
of your Company. The Company is in capital intensive sector and its
performance has also suffered due to shortage of working capital. It
has also suffered losses.
11. Particulars of loans /advances /guarantees /investments
outstanding during the financial year:
The particulars of loans / advances / guarantees / investments covered
under Section 186 of the Companies Act, 2013 and as per Clause 32 of
the Listing Agreement are given in the notes to the financial
statements provided in the Annual Report.
12. Deposits:
The Company has not accepted deposits from the public within the
meaning of Section 73 of the Companies Act, 2013 and the rules framed
there under.
13. Auditors:
Statutory Auditors
M/s. G. K. Chandavarkar & Co., Chartered Accountants, Pune were
appointed as Statutory Auditors of the Company in the 28th Annual
General Meeting held on 30th September 2014 to hold office till the
conclusion of 30th Annual General Meeting. Pursuant to Section 139(1)
of the Companies Act, 2013, the Company will place the matter related
to such appointment for ratification by the members at the ensuing
annual general meeting. The Company has received eligibility
certificate from the said Auditors in accordance with the provisions of
Section 141 of the Companies Act, 2013.
Secretarial Auditor
Mr. R. V. Pore, Practicing Company Secretary was appointed to conduct
the secretarial audit of the Company for the financial year 2014 -
2015, as required under Section 204 of the Companies Act, 2013 and
rules made there under. The Secretarial Audit Report in Form No. MR-3
for the financial year 2014 - 2015 is attached as Annexure 2 to the
Directors' Report.
14. Explanations or comments on qualification, reservation or adverse
remark or disclaimer in Auditor's Report:
The Audit Report contains certain observations and we offer our
comments in this regard as under:
Note 26(B) 1
The management was advised that the allotment is required to be made
before the execution of the Conveyance Deed. Accordingly, in good
faith the Board allotted the necessary shares to Dr. Laxman V. Kulkarni
and prepared the deed for registration. However, Dr. Laxman V.
Kulkarni, expressed his desire for upward revision of the total
consideration, as the prices of the Land at Nande have gone up
considerably since 01.04.2008 i.e. the appointed date and the market
price of the equity shares of the Company have not appreciated in line
with the same. Due to this the conveyance with Dr. Laxman V. Kulkarni
is not yet done. The management is exploring ways and means to sort out
the issue and hopes that the same will be resolved amicably. However,
until the financial difficulties are resolved, a solution to this issue
appears remote.
Statutory Dues:
Due to financial difficulties the Company could not pay the deferred
sales tax. However, the Company will settle the dues shortly.
Rest of the Auditor's observations are self explanatory.
15. Explanations or comments on qualification, reservation or adverse
remark or disclaimer in Secretarial Audit Report:
Discrepancies in the issued share capital and listed share capital:
Due to technical issues, some formalities in respect of issue of shares
made by the Scheme of Amalgamation are not yet completed; hence those
shares and the shares further issued by the Company through private
placement are yet to be listed. The Company is in a process to resolve
the issue soon. However, until the financial difficulties are resolved,
a solution to this issue appears remote.
Non - fling of Forms MGT-10 required u/s 93 of the Companies Act, 2013:
It was an understanding of the management that the Form MGT-10 needs to
be fled when the change in the shareholding of the top 10 shareholders
is 2% or more of the total paid up capital of the Company. As no such
change occurred, the Company did not file any such Form. In future the
Company will take due care in this regard.
Regarding violation of the provisions of Section 185 of the Act:
Dhanada Education Pvt.. Ltd. is a subsidiary of the Company. The said
subsidiary was non - operational during the year 2014 - 2015. Hence,
our Company has advanced sums to the said subsidiary from time to time
to meet its essential statutory / fixed expenses. On 31.03.2015, the
said subsidiary has issued shares to our Company against the entire
amount of advance and interest accrued thereon. Thereafter, the Company
has not advanced any amount to the said subsidiary.
The Statutory Auditors does not hold Peer Review Certificates:
The Auditor states that he has submitted his request to the Peer Review
Committee and Peer Reviewer. However, the Peer Review is awaited.
Non - publishing notices etc. in the newspapers as required under
Listing Agreement:
The Company has submitted notices, quarterly unaudited financial
results and audited financial statements etc. required under the
Listing Agreement to the Bombay Stock Exchange Ltd. within the
prescribed time and the same were also made available on the website of
the Company. However, due to financial difficulties, the Company did
not publish notices, results and statements etc. in the newspapers.
The Chairman of the Company is also the Managing Director and Chief
Executive Officer of the Company:
The Chairman of the Company is appointed as Managing Director and Chief
Executive Officer of the Company before the commencement of the
Companies Act, 2013. The management proposes to alter the Articles of
Association of the Company in the ensuing Annual General Meeting which
inter alia enables the Company to appoint the same individual as
Chairman, Managing Director and Chief Executive Officer of the Company.
Non - appointment of Company Secretary:
The present Company Secretary has resigned w.e.f. 30.01.2015. The
management is looking for another qualified person to fill the vacancy
caused by such resignation.
Rest of the Secretarial Auditor's observations are self explanatory.
16. Share Capital:
There were no changes in the share capital during the year under
review.
17. Extract of the Annual Return:
The extract of annual return as on the financial year ended on 31st
March 2015 in Form No. MGT-9 is enclosed as Annexure 3 and forms part
of the Directors' Report.
18. Conservation of energy, technology absorption, foreign exchange
earnings and outgo:
The Company through constant monitoring, selection of energy saving
equipments and education of staff and guests endeavors to conserve and
optimize the use of energy.
The Company does not undertake any research and development activity
neither does it use any imported technology.
Foreign Exchange Earnings : Nil
Foreign Exchange Outgo : Nil
19. Corporate Social Responsibility (CSR):
Not applicable.
20. Directors:
Changes in Directors and Key Managerial Personnel (KMP)
Mr. Gajanan M. Deshpande (DIN 00151009), Independent Director of the
Company resigned with effect from 18th September 2014. The Board
accepted his resignation.
Mr. Shriniwas G. Kale (DIN 00150957) was appointed as an Independent
Director for a term of 5 (five) consecutive years by the shareholders
in the Annual General Meeting held on 30th September 2014.
On the recommendation of Nomination and Remuneration Committee, Mr.
Mukund A. Kulkarni (DIN 03481615) was appointed as an Independent
Director of the Company on 16th December 2014.
Mrs. Sanjana Mandar Joshi, Company Secretary and Compliance Officer
resigned with effect from 30th January 2015. The Board accepted her
resignation.
On the recommendation of Nomination and Remuneration Committee, Mr.
Ramesh M. Pradhan was appointed as Chief Financial Officer (CFO) of the
Company with effect from 13th February 2015.
Till 12th May 2015, the composition of Board was as under:
Name of Director DIN Category
Mr. Ramesh R. Havele 00007580 Executive Director
Mrs. Veena R. Havele 00007596 Non-executive Director
Mr. Shreeniwas G. Kale 00150957 Independent Director
Mr. Mukund A. Kulkarni 03481615 Independent Director
With effect from 12th May 2015, Mr. Mukund A. Kulkarni (DIN 03481615),
Independent Director resigned. The Board accepted his resignation.
Accordingly, the composition of Board is reconstituted. Now, the Board
consists of 3 Directors only.
Re-appointments
Mrs. Veena R. Havele (DIN 00007593) retires by rotation at the ensuing
Annual General Meeting and is eligible for re-appointment. Your
Directors recommend her re-appointment.
None of the independent directors will retire at the ensuing Annual
General Meeting.
Statement on declaration given by Independent Directors
The Company has received necessary declaration from Independent
Directors under Section 149(7) of the Companies Act, 2013 that they
meets the criteria of independence laid down in Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
Relationship between directors inter-se
Mr. Ramesh R. Havele (DIN 00007580) and Mrs. Veena R. Havele (DIN
00007593) are related to each other as husband and wife.
Formal Annual Evaluation
The evaluation of the Board and its committees, evaluation of
performance of individual directors and independent directors in
compliance with Clause 49 of the Listing Agreement, Schedule IV and
other applicable provisions of the Companies Act, 2013 was conducted
based on the criteria such as the Board composition and structures,
effectiveness of board processes, information and functioning,
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.
The Independent Directors at its separate meeting reviewed the
performance of non - independent directors and the Board as a whole and
the performance of the Chairman.
The performance of independent directors was evaluated by the entire
Board of Directors.
Details of familiarization programmes of Independent Directors
The Company has a policy to keep the Independent Directors informed and
updated about the business and the operations of the Company, on a
continuous / as needed basis. In order to familiarize the Independent
Directors with the Company and to inform them about their roles, rights
and responsibilities, the Company conducts the orientation programs for
them.
The Company conducts an induction program for every new Independent
Director joining the Company's Board covering the organization
structure, Company's business and its subsidiaries.
The Company issues detailed letter of appointment to the Independent
Directors detailing their roles and duties to be performed as an
Independent Director on the Board of the Company.
The details of familiarization programmes of Independent Directors are
available on the website of the Company. A web link thereto is
http://www.dhanadacorp.com/pdf/Details%20of%20Familiarisation%
20programme%20for%20IDs.pdf.
21. Number of meetings of Board of Directors:
During the financial year 2014 - 2015, 5 (Five) meetings of the Board
of Directors were held.
22. Audit Committee:
The Company has Audit Committee. Till 12th May 2015, the composition of
the Committee was as stated below:
Name DIN Designation
Mr. Mukund A.
Kulkarni 03481615 Chairman
Mrs. Veena R.
Havele 00007596 Member
Mr. Shreeniwas
G.Kale 00150957 Member
With effect from 12th May 2015, Mr. Mukund A. Kulkarni (DIN 03481615)
resigned. Accordingly, the composition of Committee is reconstituted.
Now, the Audit Committee consists of two members only i.e. Mr.
Shreeniwas G. Kale (DIN 00150957) and Mrs. Veena R. Havele (DIN
00007580).
All recommendations made by the Committee during the year were accepted
by the Board.
23. Stakeholders Relationship Committee:
The Company has Stakeholders Relationship Committee. Till 12th May
2015, the composition of the Committee was as stated below:
Name DIN Designation
Mr. Shreeniwas G.
Kale 00150957 Chairman
Mrs. Veena R.
Havele 00007596 Member
Mr. Mukund A.
Kulkarni 03481615 Member
With effect from 12th May 2015, Mr. Mukund A. Kulkarni (DIN 03481615)
resigned. Accordingly, the composition of Committee is reconstituted.
Now, the Stakeholders Relationship Committee consists of two members
only i.e. Mr. Shreeniwas G. Kale (DIN 00150957), Chairman of the
Committee and Mrs. Veena R. Havele (DIN 00007580).
The Committee reviews and ensures redressal of investor grievances. No
investor complaints were received during the financial year 2014 - 15.
24. Nomination and Remuneration Committee:
The Company has Nomination and Remuneration Committee. Till 12th May
2015, the composition of the Committee was as stated below:
Name DIN Designation
Mr. Shreeniwas G.
Kale 00150957 Chairman
Mrs. Veena R.
Havele 00007596 Member
Mr. Mukund A.
Kulkarni 03481615 Member
With effect from 12th May 2015, Mr. Mukund A. Kulkarni (DIN 03481615)
resigned. Accordingly, the composition of Committee is reconstituted.
Now, the Nomination and Remuneration Committee consists of two members
only i.e. Mr. Shreeniwas G. Kale (DIN 00150957), Chairman of the
Committee and Mrs. Veena R. Havele (DIN 00007580).
The Committee has formulated policy on nomination and remuneration of
Directors, Key Managerial Personnel, Senior Management Personnel and
other employees including criteria for determining qualifications,
positive attributes and independence of director, performance
evaluation and other matters in compliance with Section 178 of the
Companies Act, 2013 read with rules made there under and Clause 49 of
the Listing Agreement. The Nomination and Remuneration Policy is
attached as Annexure 4 to the Directors' Report.
The said policy is also available on the website of the Company. A web
link thereto is http://www.dhanadacorp.com/pdf/
Nomination%20and%20Remuneration%20Policypdf
The Committee operates as per the policy adopted by the Board. All
recommendations made by the Committee were accepted by the Board.
25. Details of establishment of vigil mechanism for directors and
employees:
The Company has established Whistle Blower / Vigil Mechanism Policy for
directors and employees to report concerns about unethical behavior,
actual or suspected fraud or violation of the Company's Code of Conduct
and Ethics. The Whistle Blower / Vigil Mechanism Policy is attached as
Annexure 5 to the Directors' Report. The said policy is also available
on the website of the Company. A web link thereto is
http://www.dhanadacorp.com/pdf/Vigil%20Mechanism%20Policy.pdf
26. Particulars of contracts or arrangements with related parties:
The Company has not entered into any contracts or arrangements with
related parties referred to in Section 188(1) of the Companies Act,
2013.
The Company has formulated policy on materiality of Related Party
Transactions and also on dealing with Related Party Transactions in
compliance with Clause 49 (VII) (C). During the year, the Company has
not entered into any transaction with related parties which could be
considered material in accordance with the policy of the Company on
related party transactions and listing agreement.
The said policy is available on the website of the Company. A web link
thereto is http://www.dhanadacorp.com/pdf/Related_
Party_Transactions_Policy.pdf
27. Managerial Remuneration:
No director draws any remuneration from the Company.
Remuneration of Key Managerial Personnel (KMP)
Remuneration in Remuneration in
Name of KMP Designation 2014 - 15 (Rs,) 2013 - 14 (Rs,)
Company
Secretary
* Ms. Sanjana
Joshi 2,10,000 2,52,000
Chief
Financial
# Mr. Ramesh Officer
Pradhan 37,714 Nil
Name of KMP % Increase of Ratio of remuneration
remuneration to performance
* Ms. Sanjana NA 0.002
Joshi
# Mr, Ramesh NA 0.0004
Pradhan
* Resigned w.e.f 30.01.2015
# Appointed w.e.f. 13.02.2015
Median Remuneration of Employees (MRE) was Rs, 8,350/- and Rs, 6,950/-
in the financial year 2014 - 15 and 2013 - 14 respectively. The
increase in MRE in the financial year 2014 - 15, as compared to
financial year 2013 - 14 is 20.14%.
The number of permanent employees on the rolls of the Company as on
31.03.2015 and 31.03.2014 are 28 and 32 respectively.
The revenue of the Company has gone up by 1.95%. The Company has
suffered losses. The remuneration of the employees has increased by
4.49%.
The market capitalization of the Company increased by 8.11% to Rs,
33,56,01,486/- as of 31.03.2015 from Rs, 31,04,31,375/- as of
31.03.2014. The Price earnings ratio was 5.71 as of 31.03.2015 and
277.50 as of 31.03.2014.
The closing price of the Company's equity shares on BSE as of
31.03.2015 was Rs, 6/- representing a 40% decrease over IPO price.
It is affirmed that the remuneration of employees and KMPs is as per
the remuneration policy of the Company.
No director draws any remuneration from the Company. Hence, the ratio
of the remuneration of the highest paid Director to that of the
employees who are not Directors but receive remuneration in excess of
the highest paid Director during the year is not applicable.
No employee of the Company is receiving remuneration exceeding the
limits prescribed under Rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
28. Risk Management Policy:
In compliance with Clause 49 (VI) (A) and (B) of the Listing Agreement,
the Company has laid down procedures to inform Board members about the
risk assessment and minimization procedures. The Board of Directors has
also framed Risk Management Policy / Plan. The said policy is available
on the website of the Company. A web link thereto is
http://www.dhanadacorp.com/ pdf/Risk%20Management%20Policypdf.
29. Corporate Governance and Management Discussion and Analysis
Report:
The Company is committed to achieve business excellence and
stakeholders' welfare through good corporate governance and adhere to
the corporate governance requirements set out by SEBI. As per Clause 49
of the Listing Agreement, Management Discussion and Analysis Report and
Report on Corporate Governance along with Certificates of Compliance
from Auditors are annexed and form part of the Directors' Report.
30. Directors' Responsibility Statement:
The Directors of the Company hereby state that:
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 the Companies Act, 2013 for safeguarding the assets of
the Company and for preventing and detecting frauds 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;
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.
31. Acknowledgements:
The Directors express their sincere thanks to Dhanada Holdings Private
Limited, the parent company, the Bankers, employees and stakeholders
for their continued support and the faith and belief shown by them.
For and on behalf of the Board of Directors
DHANADA CORPORATION LIMITED
Ramesh R. Havele
Place: Pune Chairman & Managing Director
Date: 14th August 2015 (DIN 00007580)
|