DIRECTORS' REPORT
Dear Members,
Your Directors have pleasure in presenting the 43rd Annual Report together
with Audited Financial Statements of the Company for the year ended 31st March,
2024.
|
Financial Year |
| Financial Results |
2023-24 |
2022-23 |
|
(Rs. in lakhs) |
| Profit before Interest and Depreciation |
1210.30 |
2358.63 |
| Less : Interest |
1140.47 |
1301.58 |
| Profit before Depreciation |
69.83 |
1057.05 |
| Less : Depreciation |
1483.05 |
1411.23 |
| Profit before Tax |
(1413.22) |
(354.18) |
| Less : Provision for Income Tax |
|
|
| - Taxation for earlier years / MAT Credit Written off |
631.89 |
32.37 |
| - Deferred Tax Liability (Net) |
(936.71) |
277.45 |
| Profit after Tax |
(1108.40) |
(664.00) |
| Add : Other comprehensive income/(Loss) |
(36.26) |
9.16 |
| Total comprehensive income/(Loss) for the Year |
(1144.66) |
(654.84) |
DIVIDEND
The Board has not recommended any dividend for the financial year 2023-24.
REVIEW OF OPERATIONS
The Company's turnover from sale of goods and services is Rs.33440.63 Lacs during the
year compared to Rs.40985.83 Lacs in the previous year. During the year under review, the
spinning unit produced 6101.52 tonnes (8187.45 tonnes) of yarn. The spinning unit sold
6291.43 tonnes (8427.05 tonnes) of yarn and out of which exports accounted for 168.46
tonnes (237.89 tonnes). Further, during the year under review, the Company sold 2220.28
tonnes (2512.63 tonnes) of waste cotton of which exports accounted for 330.62 tonnes
(341.24 tonnes).
The Wind Mills, with aggregate installed capacity of 13.195 MW generated 107.50 lakh
units of Wind Electricity as against 107.86 lakh units in the last year. The entire power
generated by Wind Mills was utilized captively at the spinning unit.
Your Company is continuously putting efforts to widen the Product Mix under Technical
Textile segment.
PRESENTATION OF FINANCIAL STATEMENTS
The financial statements for the year ended 31.03.2024 has been prepared in accordance
with the Indian Accounting Standard (IndAS) notified under section 133 of the Companies
Act, 2013 read with Companies (Accounts) Rules, 2014 and other applicable provisions.
Consolidated Financial Statements pertaining to its Associate M/s. L.K. Distributors
Private Limited is attached elsewhere with this report. Form AOC-1 containing salient
features of associate company is also attached with this Annual Report.
PROSPECTS FOR THE CURRENT YEAR
Your Company has started concentrating on the manufacture of finer counts of yarn. The
Company has secured significant orders from the Government of India, Ministry of Defence
for the supply of 75,000 sets of Extreme Cold Weather Clothing System (ECWCS) which will
be supplied over a period of 5 years.
Further, an order for the supply of 26,667 nos. of Nuclear Biological and Chemical (NBC
Suits) and an order from Controller Procurement, Material Organization (Vizag), Eastern
Naval Command, Visakhapatnam, for the supply of 5,513 Nos. of NBC Haversack MK-II,
(Special Bags) has been received, which will be supplied during the current year.
MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING THE FINANCIAL POSITION OF THE
COMPANY
No such changes during the period under review.
TRANSFER TO RESERVES
During the year under review, the Company has not transferred any amount to General
Reserves.
SHARE CAPITAL
During the year under review there were no changes in the capital structure of the
Company.
TRANSFER OF UNCLAIMED DIVIDEND/SHARES TO INVESTOR EDUCATION & PROTECTION FUND
The Company is in the process of transferring the unclaimed dividend pertaining to the
financial year 2016-17 and the respective shares to the Investor Education and Protection
Fund and the details will be hosted in the website of the company.
EXTRACT OF ANNUAL RETURN
Pursuant to the sub-section (3) of Section 92 of the Companies Act, 2013, Annual Return
for Financial Year ended on 31st March 2024, is posted on the website of the Company viz.,
https://www.shivatex.in/shares/annual-returns/.
BOARD MEETINGS
During the year under review, five Board Meetings of the Company were conducted. The
details of the same have been given in the Corporate Governance Report under Regulation 17
of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, forming
part of this Report.
SECRETARIAL STANDARDS
During the year under review, your Company has complied with all the applicable
Secretarial Standards issued by the Institute of Company Secretaries of India from time to
time.
DIRECTORS' RESPONSIBILITY STATEMENT
As stipulated in Section 134 (5) of the Companies Act, 2013 your Directors confirm
that:
a) Your Directors have followed the applicable accounting standards in the preparation
of the annual accounts, with proper explanation relating to material departures;
b) Your 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 at the end of the financial year and of
the profit and loss of the Company for that period;
c) Your Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities;
d) Your Directors have prepared the annual accounts on a going concern basis;
e) Your Directors have 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) Your Directors have devised proper system to ensure compliance with the provisions
of all applicable laws and that such systems were adequate and operating effectively.
DIRECTORS
Sri. S V Alagappan, Director (DIN:00002450) is required to retire by rotation at the
ensuing Annual General Meeting, he is eligible for re-appointment and seeks
re-appointment.
The Board of Directors at its meetings held on 26.06.2023 has appointed Smt. V
Bhuvaneshwari (DIN:01628512) as an Independent Director of the Company for a period of 5
years w.e.f 26.06.2023 to 25.06.2028 which has been approved by the members of the Company
in their meeting held on 21.09.2023 and Sri. Jayaram Govindarajan (DIN:02178416) has been
appointed as an Independent Director of the Company for a period of 5 years w.e.f
24.05.2024 to 23.05.2029, subject to the approval of members at this Annual General
Meeting.
Sri A Dhananjayan (DIN:08043947) and Sri D Satish Krishnan, (DIN:00052973) Independent
Directors of the Company whose period of office ends on 28.05.2024 are being considered
for re-appointment for a second term of five consecutive years effective from 29.05.2024
till 28.05.2029 subject to the approval of shareholders. Suitable resolutions along with
explanatory statement and justification for their re-appointment as an Independent
Directors have been set out in the Notice to the members.
Sri S Marusamy (DIN:00610091) was re-appointed as a Non-Executive Independent Director
of the Company on 25.08.2019 and his second tenure of office ends on 24.08.2024. Sri S
Marusamy was associated with Company for a continuous period of 18 years. The Board
recorded the valuable contributions and guidance rendered by Sri S Marusamy during his
tenure of office as an Independent Director of the Company.
Sri S K Sundararaman, Managing Director of Shiva Texyarn Ltd is eligible for a
commission of 5% on the net profits of the Company. He is also holding the position of
Managing Director in M/s. Vedanayagam Hospital Private Ltd (Holding Company) without any
remuneration.
The Company has obtained a Certificate from Sri R Dhanasekaran, Company Secretary in
Practice, certifying that none of the Directors on the Board of the Company have been
debarred / disqualified from being appointed or continuing as Directors of the Company by
the Board / Ministry of Corporate Affairs or any such statutory authority.
DECLARATION OF INDEPENDENT DIRECTORS
All the 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 Regulation
16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015.
ANNUAL EVALUATION OF BOARD, COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 (10) of the
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Independent
Directors at their meeting without participation of non Independent Directors and
management, considered and evaluated the Boards' performance, performance of the Chairman
and Managing Director. The Board has carried out an annual evaluation of its own
performance and performance of the individual Directors as well as the Committees of
Directors.
COMPOSITION OF AUDIT COMMITTEE
The Audit Committee comprises of the following members:-
| 1. |
Sri A Dhananjayan |
Chairman (Non- Executive Independent Director) |
| 2. |
Sri D Satish Krishnan |
Member (Non- Executive Independent Director) |
| 3. |
Sri S K Sundararaman |
Member (Managing Director) and |
| 4. |
Smt. V Bhuvaneshwari |
Member (Non- Executive Independent Director) (w.e.f 26.06.2023) |
The Board has implemented the suggestions, if any, made by the Audit Committee from
time to time.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The Company has not granted any loans or guarantees governed under the provisions of
Section 186 of the Companies Act, 2013. The details of the investments made by Company are
given in the notes to the financial statements.
ESTABLISHMENT OF VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has established a Vigil Mechanism for Directors and employees to report
concerns about unethical behaviour, actual or suspected fraud or violation of the
Company's code of conduct or ethics. The policy has been posted in the website of the
Company viz., https:// www.shivatex.in/shares/595/policies/.
COMPANY'S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION
Your Company is covered under the provisions of Section 178(1) of the Companies Act,
2013. The Board of Directors have framed a policy setting out the framework for
appointment and payment of remuneration to Directors, Key Managerial Personnel and Senior
Management Personnel of the Company. The policy is explained as part of the Corporate
Governance Report. The Nomination and Remuneration Committee ensures that:
1. The level and composition of remuneration is reasonable and sufficient to attract,
retain and motivate Directors of the quality required to run the Company successfully.
2. Relationship of remuneration to performance is clear and meets appropriate
performance benchmarks and Charter on Nomination and Remuneration can be accessed at
Company's website https:// www.shivatex.in/ shares/129/policies/.
PARTICULARS OF CONTRACTS AND Arrangements & RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year in the
ordinary course of business were on arm's length basis. Form AOC-2 is annexed elsewhere in
this annual report. Further no materially significant related party transactions were made
by the Company with Promoters, Key Managerial Personnel or other designated persons which
may have potential conflict with interest of the company at large.
Approval of Audit Committee was obtained for transactions of repetitive nature on
annual basis. All related party transactions are placed before the Audit Committee and
Board of Directors for their review. The policy on Related Party Transactions is available
in the website https:// www.shivatex.in/shares/542/policies/.
CERTAIN ADDITIONAL INFORMATION AND DETAILS REQUIRED AS PER RULE 8(5) OF THE COMPANIES
(ACCOUNTS) RULE, 2014, ARE FURNISHED HEREIN BELOW:
| S.No. Particulars |
Remarks |
| i. The Financial summary or highlights |
The details are furnished at the beginning of the Director's Report |
| ii. The change in the nature of business, if any |
There was no change in the nature of principal business of the Company during the
financial year ended 31st March 2024. |
| iii. The details of Directors or Key Managerial Personnel who were appointed or have
resigned during the year |
Smt. V Bhuvaneshwari (DIN:01628512) was appointed as an Independent Director of the
Company w.e.f 26.06.2023. Sri Jayaram Govindarajan (DIN:02178416) was appointed as an
Additional Director in the capacity of Independent Director of the Company w.e.f
24.05.2024. |
| iii. a. A Statement regarding opinion of Board with regard to integrity, expertise and
experience (including the proficiency) of the Independent Directors appointed during the
year |
Smt. V Bhuvaneshwari (DIN:01628512) and *Sri Jayaram Govindarajan (DIN:02178416) were
appointed as an Independent Directors of the Company on 26.06.2023 and 24.05.2024
respectively and the Board is of the opinion that they meets the criteria of integrity,
expertise and relevant experience (including the proficiency) for appointment. |
|
* His appointment is subject to the approval of members at the ensuing meeting. |
| iv. The names of companies which have become or ceased to be its Subsidiaries, Joint
Ventures or Associate Companies during the year |
NIL |
v. The details relating to deposits, covered under Chapter V of the Act
| S.No. Particulars |
Remarks |
| A. Accepted during the year |
Nil |
| B. Remained unpaid or unclaimed as at the end of the year |
Nil |
| C. Whether there has been any default in repayment of deposits or payment of interest
thereon during the year and if so, number of such cases and the total amount involved |
Nil |
| i) At the beginning of the year |
|
| ii) Maximum during the year |
|
| iii) At the end of the year |
|
| vi The details of deposits which are not in compliance with the requirements of
Chapter V of the Act. |
Not Applicable |
| vii The details of significant and material orders passed by the regulators or courts
or tribunals impacting the going concern status and company's operations in future |
There are no significant and material orders passed by the Regulators/Courts that
would impact the going concern status and the Company's operation in future. |
| viii The details in respect of adequacy of internal controls with reference to the
Financial Statements |
The Company has an Internal Control System, commensurate with the size, scale and
complexity of its operations. The Company has appointed an Internal Auditor as required
under Section 138 of the Companies Act, 2013. The scope and authority of the Internal
Audit function is reviewed by the Audit Committee from time to time. To maintain its
objectivity and independence, the Internal Auditor directly reports to the Audit
Committee. |
|
Based on the report of internal audit function, corrective actions are taken in the
respective areas to further strengthen the internal controls. Significant audit
observations and recommendations along with corrective actions thereon are presented to
the Audit Committee of the Board, if any. |
| S.No. Particulars |
Remarks |
| ix Maintenance of cost records under sub-section (1) of section 148 of the Companies
Act, 2013 |
Pursuant to the provisions of Section 148(1) of the Companies Act, 2013 read with
Companies (Cost Records and Audit) Rules, 2014, the Company was required to maintain cost
records. Accordingly, the required accounts and cost records are duly made and maintained
by the company during the year under review. |
| x A statement that the Company has complied with the provisions relating to the
constitution of Internal Complaints Committee under the Sexual Harassment of Women at
Workplace (Prevention, Prohibition & Redressal) Act, 2013 |
The Company has constituted Internal Complaints Committee and has in place an
Anti-Sexual Harassment Policy as stipulated under The Sexual Harassment of Women at the
Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints for sexual harassment. All employees
(permanent, contractual, temporary, trainees) are covered under this policy. |
| No. of Complaints filed during the . Financial Year 2023-24 |
NIL |
| b No. of Complaints disposed off . during the Financial Year 2023-24 |
NIL |
| No. of Complaints pending as on end . of the Financial Year 2023-24 |
NIL |
| xi. The details of application made or any proceedings pending under the Insolvency
and Bankruptcy Code 2016 during the year along with their status as at the end of the
financial year |
Not applicable |
| xii. The details of difference between amount of the valuation done at the time of one
time settlement and the valuation done while taking loan from the Banks or Financial
Institutions along with the reasons thereof |
Not applicable |
CORPORATE GOVERNANCE
In line with requirements of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 your Company is committed to the principles of good Corporate Governance
and continues to adhere good corporate governance practices consistently.
A separate section is given on Corporate Governance, Management Discussion and Analysis
along with a certificate from the Practicing Company Secretary regarding compliance with
conditions of Corporate Governance, as stipulated under Regulation 34(3) read with
Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
which forms part of this Annual Report.
AUDITORS
As per Section 139 of the Companies Act, 2013 M/s. VKS Aiyer & Co., Chartered
Accountants, Coimbatore (Firm Registration No. 000066S) were appointed as Statutory
Auditors of the Company for a term of 5 consecutive years in the 41st Annual General
Meeting held on 12.09.2022 and will hold office up to 46th Annual General Meeting without
requirement of further ratification every year as per the provisions of Companies
(Amendment), Act, 2017. The Audit Committee and Board has recommended a revision in the
remuneration payable to M/s. VKS Aiyer & Co., from the existing amount of
Rs.14,00,000/- per annum (Rupees: Fourteen Lakhs Only) to Rs.15,40,000/- per annum
(Rupees: Fifteen Lakhs Forty Thousand Only) payable from the conclusion of 43rd Annual
General Meeting till the conclusion 46th Annual General Meeting subject to the approval of
shareholders. The resolution seeking members' approval for the increase in the
remuneration payable to M/s. VKS Aiyer & Co., Chartered Accountants, Statutory
Auditors forms part of the Notice convening Annual General Meeting.
DETAILS OF FRAUDS REPORTED BY AUDITORS
There were no frauds reported by the Statutory Auditors under the provisions of Section
143(12) of the Companies Act, 2013 and rules made thereunder during the year under review.
No adverse qualifications/comments have been made by the Statutory Auditor Report
during the year under review.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company appointed
Mr. R Dhanasekaran, Practicing Company Secretary to undertake the Secretarial Audit of the
Company. The Secretarial Audit report is attached herewith as Annexure - I.
No adverse qualifications/comments have been made in the said report by the Practicing
Company Secretary.
The Certificate of non-disqualification of Directors pursuant to Regulation 34(3) and
Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure
Requirements), Regulations 2015 are attached with this report.
COST AUDITOR
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost
Records and Audit) Rules 2014 as amended from time to time, the Board of Directors, on the
recommendation of Audit Committee, have appointed Sri M Nagarajan, Cost Accountant,
Coimbatore as Cost Auditor to conduct Cost Audit of the Company for the financial year
2024-25 with remuneration. As required under the Companies Act, 2013, a resolution seeking
members' approval for the remuneration payable to the Cost Auditor forms part of the
Notice convening Annual General Meeting.
INTERNAL AUDITOR
The Company has appointed M/s. B.M Associates, Chartered Accountants as Internal
Auditor to conduct the internal audit of the Company and the Audit Committee, in
consultation with Internal Auditor formulate the scope, functioning, periodicity for
conducting Internal Audit.
STATEMENT ON RISK MANAGEMENT POLICY
Your company is not required to constitute a Risk Management Committee as per
Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 (only applicable to top 1000 listed entities based on the market capitalization as on
31.03.2024). Pursuant to Section 134(3) (n) of the Companies Act, 2013, the Company have a
Risk Management Policy including identification therein of elements of risk, if any, which
in the opinion of the Board may threaten the existence of the Company.
Company's Risk Management Policy can be accessed at Company's website https://
www.shivatex.in/shares/130/ policies.
CSR INITIATIVES AND COMPOSITION OF CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Company has constituted Corporate Social Responsibility Committee (CSR), which
shall recommend to the Board, the activities to be undertaken by the Company as specified
in schedule VII of the Companies Act, 2013, recommend the amount of expenditure to be
incurred on such activities and monitor the CSR policy of the Company. The CSR provisions
are not applicable to the Company for the financial year 2023-24 and hence the spending
towards CSR obligation does not arise during the year under review.
Corporate Social Responsibility Committee constituted by the Board with effect from
21.05.2014, presently comprised of the following Directors.
| 1. |
Dr S V Kandasami |
- Chairman |
| 2. |
Smt. S Sujana Abirami |
- Director |
| 3. |
Sri D Satish Krishnan |
- Independent Director |
Company Secretary of the Company is the Secretary of this Committee. Managing Director
and Chief Financial Officer are attending the Committee as invitees. The CSR activities
and its related particulars are enclosed as Annexure II.
STATUTORY DISCLOSURES
I. Conservation of Energy and others
The particulars required to be included in terms of Section 134(3)(m) of the Companies
Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 for the year ended
31st March, 2024 relating to Conservation of Energy, etc., is enclosed as Annexure III.
II. Remuneration of Directors and other details
The information required under Section 197(12) of the Companies Act, 2013 read with
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming
part of the Directors' Report for the year ended 31st March, 2024 is provided as Annexure
IV to this report.
HUMAN RESOURCES AND INDUSTRIAL RELATIONS
During the year under review the human relations continued to be very cordial. The
Board of Directors wishes to acknowledge the contribution of the employees at all levels
of the organization.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude the timely assistance and help extended by
the Bankers for having provided the required bank facilities. Your Directors wish to place
on record their appreciation of the contributions made by the employees at all levels for
the continued good performance of your company.
|
By Order of the Board |
|
S V ALAGAPPAN |
| Coimbatore |
CHAIRMAN |
| 24.05.2024 |
(DIN:00002450) |