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Astra Microwave Products Ltd.

BSE: 532493 Sector: Telecom
NSE: ASTRAMICRO ISIN Code: INE386C01029
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OPEN 109.00
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VOLUME 2311
52-Week high 153.00
52-Week low 101.40
P/E 20.11
Mkt Cap.(Rs cr) 943.94
Buy Price 109.00
Buy Qty 278.00
Sell Price 109.40
Sell Qty 106.00
OPEN 109.00
CLOSE 108.50
VOLUME 2311
52-Week high 153.00
52-Week low 101.40
P/E 20.11
Mkt Cap.(Rs cr) 943.94
Buy Price 109.00
Buy Qty 278.00
Sell Price 109.40
Sell Qty 106.00

Astra Microwave Products Ltd. (ASTRAMICRO) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 25th Annual Report and the AuditedFinancial Statements for the financial year ended March 31 2016.

FINANCIAL RESULTS

A) STANDALONE:

The Standalone performance for the Financial Year ended March 312016 is as under:

The Financial Summary

As of March 31

(Amount in Rs.)

Particulars 2016 2015
Total Revenue 4374509469 6441786700
Profit before finance cost depreciation and tax expense 1037248453 1124596558
Finance cost 87883632 94829127
Profit before depreciation and tax expense 949364821 1029767431
Depreciation 235844594 215385153
Profit before tax expense 713520227 814382278
Tax expense 149929294 207130798
Net Profit for the year 563590933 607251480
Profit brought forward from earlier year 2242811807 1813382877
Profit available for appropriation 2806402740 2420634357
Appropriations:
Dividend (Including Tax on Dividend) 125092532 117822550
Transfer to general reserve 60000000 60000000
Transfer to Debenture redemption reserve 41700000 0
Surplus in Statement of Profit and Loss 2579610208 2242811807

B) CONSOLIDATED:

The Consolidated performance for the Financial Year ended March 312016 is as under:

The Financial Summary

As of March 31

(Amount in Rs.)

Particulars 2016 2015
Total Revenue 4366969605 6434059924
Profit before finance cost depreciation and amortization impairment loss exceptional items and tax expense 1043375577 1168000411
Finance cost 91286857 99679290
Profit before depreciation and amortization impairment loss exceptional items and tax expense 952088720 1068321121
Depreciation and amortisation 240420430 220467308
Profit before impairment loss exceptional items and tax expense 711668290 847853813
Impairment loss 0 0
Profit before exceptional items tax expense share of loss of Associates and Minority Interest 711668290 847853813
Exceptional items 250957 636927
Profit before tax expense share of loss of Associates and Minority interest 711919247 847216886
Tax expense 148215926 219510353
Profit after tax expense and before share of loss of Associates and Minority interest 563703321 627706533
Share of Loss of Associates (1084466) (124636)
Minority Interest (profit/loss) 28 (510)
Net Profit for the year 562618883 627581387
Profit brought forward from earlier year 2260844493 1811085656
Profit available for appropriation 2823463376 2438667043
Appropriations:
Dividend (Including Tax on Dividend) 125092532 117822550
Transfer to general reserve 60000000 60000000
Transfer to Debenture redemption reserve 41700000 0
Surplus in Statement of Consolidated Profit and Loss 2596670844 2260844493

For detailed analysis of the performance please refer to management's discussion andanalysis section of the annual report.

State of the Company's Affairs:

During the period under review the Company has achieved revenue of Rs.4374509469/-and net profit of Rs.563590933/- on a standalone basis. During the same period theCompany has achieved revenue of Rs.4366969605/- and net profit of Rs.562618883/- ona consolidated basis.

Fund Raising

Equity - Qualified Institutional Placement

During the year under review your Company successfully placed 4786450 equity sharesthrough the process of Qualified Institutional Placement (QIP) and raised an amount of Rs.649999910/-. The deployment of funds for the projects specified is yet to happen fully.

Consequent to the above the paid up value of the equity share capital of the Companystands increased from Rs. 16.36 crores to Rs. 17.32 crores.

Debt

Secured Non-Convertible Debentures (NCD)

During the year under review your Company issued Secured Non-Convertible Debentures(NCD) to the tune of Rs. 50.00 Crores.

Listing of Equity Shares:

The Company's Equity shares are listed at the following Stock Exchanges:

(i) BSE Limited Phiroze JeeJeebhoy Towers Dalal Street Mumbai-400 001; and

(I) National Stock Exchange of India Limited Exchange Plaza Floor 5 Plot No. C/1 GBlock Bandra- Kurla Complex Bandra (East) Mumbai - 400051.

The Company has paid the Annual Listing Fees to the said Stock Exchanges for thefinancial year 2015-16.

Awards

Your Company was awarded for outstanding achievements in Business Excellence for theyear 2014-15 from ELCINA Electronic Industries Association of India New Delhi.

Subsidiary Companies

As per the provisions of Section 129 of the Companies Act 2013 read with Companies(Accounts) Rules 2014 a separate statement containing the salient features of thefinancial statements of the subsidiary Companies/ Associate Company in Form AOC-1 isenclosed as Annexure-1 to this Report.

Performance and financial position of the Subsidiaries Associate and Joint VentureCompanies:

Report on the performance and financial position of the subsidiary and associatecompany of the Company is prepared and same is enclosed as Annexure -1 to thisReport.

Consolidated Financial Statements

Consolidated financial statements have been prepared by the Company's Management inaccordance with the requirements of Accounting Standards 21 issued by Institute ofChartered Accountants of India (ICAI) and as per the provisions of Companies Act 2013.The audited consolidated financial statement is provided in the Annual Report.

Number of Meetings of the Board of Directors

During the year ended March 312016 seven Board Meetings were held.

The dates on which the Board meetings were held are April 02 2015 April 30 2015July 30 2015 October 29 2015 December 04 2015 December 26 2015 and January 292016.

Management Discussion and Analysis

The Management Discussion and Analysis forms an integral part of this Report and givesdetails of the overall industry structure developments performance and state of affairsof the Company and other material developments during the financial year.

Directors Responsibility Statement

Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto the Directors'

Responsibility Statement the Board of Directors of the Company hereby confirms:

i) that in the preparation of the Annual Accounts the applicable accounting standardshave been followed;

ii) that the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 312016 andof Profit and Loss Account of the Company for that period;

iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that the Directors have prepared the Annual Accounts for the Financial Year endedMarch 312016 on a going concern basis;

v) that the Directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

vi) that the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

Statement on Declaration given by Independent Directors under Sub-Section (6) ofSection 149

The independent directors have submitted the declaration of independence as requiredpursuant to section

149(7) of the Companies Act 2013 stating that they meet the criteria of independenceas provided in subsection^).

Nomination and Remuneration Committee

The Nomination and Remuneration Committee consists of the following Directors namely

Dr. G.Sabarinathan Chairman Dr.Shiban K Koul Mr. T.Ramachandru IAS.

Brief description of terms of reference:

a. Formulation of the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board a policy relating to theremuneration of the directors key managerial personnel and other employees;

b. Formulation of criteria for evaluation of Independent Directors and the Board.

c. Devising a policy on Board diversity.

d. Identifying persons who are qualified to become Directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardtheir appointment and removal.

Nomination and Remuneration policy

The objectives of the Policy

1. To lay down criteria and terms and conditions with regard to identifying persons whoare qualified to become Directors (Executive and Non-Executive) and persons who may beappointed in Senior Management and Key Managerial positions and to determine theirremuneration.

2. To determine remuneration based on the Company's size and financial position andtrends and practices on remuneration prevailing in peer companies.

3. To carry out evaluation of the performance of Directors.

4. To retain motivate and promote talent and to ensure long term sustainability oftalented managerial persons and create competitive advantage.

Particulars of Loans Guarantees or Securities or Investments under Section 186

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in Note 2.112.34 and 2.35 of the Notes to thefinancial statements.

Particulars of Contracts or Arrangements with Related Parties

All transactions entered by the Company with Related Parties were in the ordinarycourse of business and at Arm's Length pricing basis. The audit committee granted omnibusapproval for the transactions (which are repetitive in nature) and the same was reviewedby the audit committee and the Board of Directors.

Your Directors draw attention of the members to Note 2.35 to the financial statementwhich sets out related party disclosures.

Transfer of Amount to Reserves

Your Directors have proposed to transfer Rs.600 lacs to the General Reserve for theFinancial Year ended 31st March 2016.

Dividend

The Board of Directors of the Company at its meeting held on April 29 2016 havedeclared Final Dividend @ 60% on the paid up Equity share capital of the Company i.e.Rs.1.20 per Equity share on face value of Rs.2 each.

Extracts of Annual Return

Extract of Annual Return of the Company is annexed herewith as Annexure - 2 tothis Report.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided in Annexure- 3 to this Report.

Corporate Social Responsibility (CSR) initiatives

Pursuant to Section 135 of the Companies Act 2013 read with the Companies (CorporateSocial Responsibility Policy) Rules 2014 your company approved a Policy on CSR and thepolicy was hosted on the website of the Company.

The Board of Directors of the Company have constituted Corporate Social ResponsibilityCommittee consisting of following persons namely Mrs. C.Prameelamma Chairman Dr.Shiban KKoul and Mr. M. V. Reddy as Members.

Report on CSR activities is enclosed as Annexure - 4 to this Report.

Mechanism for Evaluation of Board

Evaluation of all Board members is done on an annual basis. The evaluation is done bythe Board Nomination and Remuneration Committee and Independent Directors with specificfocus on the performance and effective functioning of the Board and Individual Directors.

Directors and Key Managerial Personnel

During the year under review Mr.J.Venkatdas Independent Director and Mr.Atim Kabraand Mr.U.K.Kalyanaramudu Non-Executive Directors stepped down from the Board. The Boardwishes to place on record its deep sense of appreciation for the valuable contributionmade by them to the Board and the Company during their tenure as Directors.

Mrs. C.Prameelamma and Mr. M.V. Reddy Directors of the Company retire by rotation andbeing eligible offer themselves for re-appointment.

Prof. Arun Kumar Tiwari Mr. Vadlamani Venkata Rama Sastry and Mr. Buddharaju LakshmiNarayana Raju were appointed as Additional Directors (Independent) on the Board witheffect from January 29 2016.

Deposits

The Company has not accepted any deposits from the public in terms of Section 73 of theCompanies Act 2013.

Statutory Auditors

The Shareholders of the Company at the Annual General Meeting held on July 30 2015have appointed M/s. Amar & Raju Chartered Accountants as Statutory Auditors of theCompany.

The term of M/s. Amar & Raju Chartered Accountants Statutory Auditors shall holdthe office from the conclusion of this Annual General Meeting until the conclusion of thenext Annual general Meeting of the Company.

It is proposed to re-appoint them as Statutory Auditors of the Company for a period ofone consecutive year. The members are requested to consider their re-appointment andauthorize the Board of Directors to fix their remuneration.

M/s. Amar & Raju Chartered Accountants (ICAI Registration No: 000092S) haveconfirmed that their appointment if made shall be in accordance with the provisions ofSection 139 of the Companies Act 2013.

Auditors Report

M/s. Amar & Raju Chartered Accountants (ICAI Registration No: 000092S) has issuedAuditors Report for the Financial Year ended 31st March 2016 and there are noqualifications in Auditors' Report.

Internal Auditors

The Board of Directors of the Company have appointed M/s. PricewaterhouseCoopersPrivate Limited to conduct Internal Audit of the Company for the Financial Year ended31st March 2016.

Audit Committee

Audit Committee consists of the following Directors namely Dr. G. SabarinathanChairman Dr.Shiban K Koul and Mr. S.Gurunatha Reddy as members of the committee. ExceptMr.S.Gurunatha Reddy all the members of the Audit Committee are Independent Directors.

There is no such incidence where Board has not accepted the recommendation of the AuditCommittee during the year under review.

Corporate Governance

A separate report on Corporate Governance is annexed as part of the Annual Report alongwith the Auditor's Certificate on its compliance.

Vigil Mechanism

The Board of Directors have adopted Whistle Blower Policy. The Whistle Blower Policyaims for conducting the affairs in a fair and transparent manner by adopting higheststandards of professionalism honesty integrity and ethical behaviour. All permanentemployees of the Company are covered under the Whistle Blower Policy.

A mechanism has been established for employees to report concerns about unethicalbehaviour actual or suspected fraud or violation of Code of Conduct and Ethics. It alsoprovides for adequate safeguards against the victimization of employees who avail of themechanism and allows direct access to the Chairman of the audit committee in exceptionalcases.

Secretarial Auditor Report

As per the provisions of Section 204 of the Companies Act 2013 the Board of Directorshave appointed

Mr. L. Dhanamjay Reddy Practising Company Secretary (C.PNo: 3752) as SecretarialAuditor to conduct

Secretarial audit of the company for the Financial year ended on March 312016.

Secretarial Audit Report issued by Mr. L. Dhanamjay Reddy Practising Company Secretaryin form MR-3 is enclosed as Annexure - 5 to this Annual Report.

There were no qualifications reservation or adverse remarks in the Secretarial AuditReport of the Company.

Statement of particulars of appointment and remuneration of managerial personnel

The Statement of particulars of Appointment and Remuneration of Managerial personnel asper Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is enclosed as Annexure - 6 to this Annual Report.

Insurance

All properties and insurable interests of the Company including building plant andmachinery and stocks have been fully insured.

Internal Financial Controls

The company has in place adequate internal financial controls with reference tofinancial statements. The Company maintains all its records in SAP System and the workflow and approvals are routed through SAP

Change in the nature of business

There is no change in the nature of business of the Company.

The details of significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and company's operations in future

No Significant and material orders passed by the regulators or courts or tribunalsimpacting the going concern status and company's operations in future.

Material changes and commitments

There are no Material changes and commitments in the business operations of the Companyfrom the financial year ended 31st March 2016 to the date of signing of the Director'sReport.

Human Resources

The Industrial relations of the Company continued to be harmonious during the yearunder review.

Policy on Sexual Harassment

The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplacein accordance with The Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.

During the financial year ended 31st March 2016 the Company has not received anyComplaints pertaining to Sexual Harassment.

Acknowledgments:

Your Directors express their gratitude to all investors customers vendors banks andregulatory and the State and the Central governmental authorities/departments for theircontinued support.

For and on behalf of the Board of Directors

Place: Hyderabad Mr. B. Malla Reddy Mr. P. A. Chitrakar
Date: 28.05.2016 Managing Director CEO
DIN:00003154 DIN:00003213

ANNEXURE - 3 TO THE DIRECTORS' REPORT

The conservation of energy technology absorption foreign exchange earnings and outgopursuant to the provisions of section 134(3)(m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014:

1. Details of Conservation of Energy

The operation of the company are not energy intensive. However adequate measures havebeen taken to conserve and reduce the energy consumption.

2. Research & Development (R&D)

The Company's Research and Development centre is recognized by the Department ofScientific and Industrial Research Ministry of Science and Technology Government ofIndia in the year 1994.

During the year the R&D wing of the Company has developed innovative designs usefulfor manufacture of cost effective products. The research and development activities of theCompany are customer need based and hence it is a continuous process. Because of itsin-house R&D efforts the Company was able to deliver the solutions to the customersin cost effective manner.

The Company has spent the following amounts for R&D during the year.

As of March 31 (Amount Rs.)

Particulars 2016 2015
a. Capital 18880826 61186703
b. Recurring 292723300 174551043
Total 311604126 235737746
Total R&D expenditure as Percentage of total turnover 7.12% 3.66%

3. Technology Absorption Adoption and Innovation

The Company works on in house technology.

4. Particulars of foreign exchange earnings and outgo

The export business which is project driven has undergone substantial reduction duringthe year and is likely to be a low key business for next couple of years.

Foreign Exchange outgo and earnings

As of March 31 (Amount Rs.)

Particulars 2016 2015
Foreign Exchange outgo 801448125 549197378
Foreign Exchange Earnings 1390196835 3829930344

 

For and on behalf of the Board of Directors

Place: Hyderabad Mr. B. Malla Reddy Mr. P. A. Chitrakar
Date: 28.05.2016 Managing Director COO
DIN:00003154 DIN:00003213

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