IMP Powers Ltd.
|BSE: 517571||Sector: Engineering|
|NSE: INDLMETER||ISIN Code: INE065B01013|
|BSE LIVE 15:40 | 18 Oct||78.05||
|NSE 19:31 | 19 Oct||77.20||
|Mkt Cap.(Rs cr)||67|
|Mkt Cap.(Rs cr)||67.44|
IMP Powers Ltd. (INDLMETER) - Director Report
Company director report
Your Directors present 54th Annual Report on the business and operations ofIMP Powers Ltd. ("IMP"/ the "Company") together with theaudited financial statements for the year ended March 312016 and other accompanyingreports notes and certificates.
The financial highlights of the Company for the year ended March 312016 are asfollows:
(Rs. in lacs)
* Provision of Proposed Dividend of included Rs. 2.50 lacs of short provision made inprevious financial year because company has allotted 163753 equity shares on 14thJuly 2015 and 336250 equity shares on 15th July 2015 prior to record date.
Your Directors are pleased to recommend a Dividend of Re. 0.50 (i.e. @5%) per EquityShare of Rs.10 each. The total outgo on account of payment of Dividend for the currentyear amounts to Rs. 54.47 Lacs including dividend distribution tax of Rs. 8.79 Lacs (asagainst Rs. 48.44 Lacs including dividend distribution tax of Rs. 7.76 Lacs in theprevious year).
The company's sales has increased by over 9% in FY 2015-16 over FY 2014-15. The PAT hasincreased by over 19.8% in FY 2015-16 over FY 2014-15. The consolidated sales of the yearunder review was Rs. 363 crore and consolidated Profit after Tax (PAT) was Rs. 3.41 crore.
Your Company is amongst the top 5 power transformer companies in India in the132-220 kv Class category.
The Company has orders worth Rs. 466 crores in hand.
Your Company has successfully conducted Dynamic Short Circuit test on 12.5 MVA66/11 kv and 20 MVA 66/11 kv Power Transformer. With this achievement the Company isranked among the Top 3 manufacturers in India who have conducted Short Circuit Test byCentral Power Research Institute (CPRI) Bangalore.
IMP Energy Ltd. a subsidiary of the Company has got 7 MW project in Jammu andKashmir Energy Dev. Agency (JAKEDA).
Your Company has ventured into an exciting new business - Exclusive Marketing of"Kinetic energy turbines" - a break-through technology of Smart Hydro Power GmbHLtd. - a German Company.
Finance and Rating:
You will be glad to know that the Credit rating agency CARE in its recent evaluationhas reaffirmed the rating of your Company as CARE "BBB-" for long term creditrating and CARE "A3" for short term credit rating.
Future Growth Prospects:
Based on the governments' emphasis on power sector - generation transmission &distribution tide of the transformer industry has turned around hugely. The company hashighest EBIDTA margins amongst its peers indicating operational efficiency as well ascompetitiveness of its products (in terms of quality pricing etc.) vis-a-vis its peers.The company with empanelment / enlistment with PGCIL NTPC & Railways etc. expectsadditional orders for substantial amounts for transformers of upto 220 KV & 400 KVclass. The planned investments in power sector replacement demand export potential anddevelopment of inter-regional capacity is surely to sustain the demand of transformers innear to medium term. In short the company being amongst the few top better performingcompanies in transformer space is well poised to tap huge opportunities and benefitsubstantially from FY 2017-18.
Your Company manufacturing Transformers of range up to 400 kv Class is fullyequipped with most modern Plant & Machinery to grab the opportunity provided by thepower transformer market. With all in-house testing arrangements to conduct RoutineAcceptance & all Type Tests as per IS & IEC standards your Company always strivefor total customer satisfaction by providing quality products and service on time.
For detailed analysis of the performance please refer to the Management Discussion andAnalysis section of the Annual Report given in Annexure-IV.
Your Company has one (1) subsidiary as on March 312016. There are no associatecompanies or joint venture companies within the meaning of Section 2(6) of the CompaniesAct 2013 ("Act"). There has been no material change in the nature of thebusiness of the subsidiaries.
Pursuant to the provisions of Section 129(3) of the Act a statement containing salientfeatures of the financial statements of the Company's subsidiary in Form AOC-I are annexedas Annexure-A and forms part of this Report.
Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate audited accounts in respect of subsidiary company are available on the website ofthe Company.
IMP Energy Ltd (IEL) a Subsidiary Company of IMP Powers Limited is engaged incomplete EPC Work of small hydro Power (SHP) business. The Company sets up small hydropower plants of upto 5 MW capacity and does the entire EPC work. It is currently executing12 projects and out of which 3 projects are expected to be commissioned during FY 2016-17.Also IMP Energy Ltd. is L1 in 7 MW of IPP projects in Jammu and Kashmir State.
MATERIAL CHANGES AND COMMITMENTSAFFECTING FINANCIAL POSITION BETWEEN THE END OFFINANCIAL YEARAND DATE OF REPORT
There are no material changes and commitments affecting financial position between theend of financial year and date of this Report.
BOARD OF DIRECTORS MEETINGS AND ITS COMMITTEES
The Board of Directors comprises of 9 (Nine) Directors as on March 312016. Of the 9(Nine) Directors 6 (Six) are Non-Executive Directors and 3 are (Three) ExecutiveDirectors. The Non-executive Directors include 5 (Five) Independent Directors and 1(One)Investor Director. The composition of the Board is in conformity with the provisions ofthe Act and Regulation 17 of the Listing Regulations entered into with the StockExchanges. During the year the non-executive directors of the Company had no pecuniaryrelationship or transactions with the Company other than the sitting fees paid to themfor the purpose of attending meetings of the Company.
The Board of Directors on recommendation of the Nomination and Remuneration Committeeappointed Dr. Praveen Saxena as an Additional Director in the category of IndependentDirector w.e.f. May 27 2016 who shall hold the office until the ensuing Annual GeneralMeeting ("AGM") and is eligible for appointment at the AGM. The appointment ofDr. Praveen Saxena as an Independent Director for the period of 5 years w.e.f. May 272016 is subject to approval of the Members of the Company at the ensuing AGM.
All the Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Act.
Mr. Jayant Narayan Godbole Non-Executive and Independent Director of the Companyresigned from the Board of the Company w.e.f. March 14 2016 due to personal reasons. TheBoard placed on record its appreciation for the contribution made by him during his tenureas Director of the Company.
Mrs. Rajkamal Sukhani Non-Executive and Independent Director of the Company resignedfrom the Board of the Company w.e.f. August 12 2016 due to personal reasons. The Boardplaced on record its appreciation for the contribution made by her during her tenure asDirector of the Company.
Directors retiring by rotation
In accordance with the relevant provisions of the Act and in terms of the Articles ofAssociation of the Company Mr. Ramniwas R Dhoot Chairman of the Company retires byrotation at the ensuing AGM and being eligible offers himself for re-appointment. TheBoard recommends his re-appointment.
Meetings of the Board of Directors
During the financial year ended March 312016 5 (Five) Board meetings were held.Details of the composition of the Board meetings of the Board held and attendance of theDirectors at such meetings are provided in the Corporate Governance Report annexed tothis Report. The intervening gap between the meetings was within the period prescribedunder the Act and the Listing Regulations.
Committees of the Board
There are currently 4 (Four) Committees of the Board as follows:
(i) Audit Committee
(ii) Nomination and Remuneration Committee
(iii) Stakeholders' Relationship Committee
(iv) Corporate Social Responsibility Committee
During the financial year ended March 312016 the Board re-constituted Nomination andRemuneration Committee in accordance with the Act and the Listing Regulations.
Details of all the Committees along with their terms of reference composition andmeetings of each Committee held during the year are provided in the Corporate GovernanceReport annexed to this Report.
KEY MANAGERIAL PERSONNEL
In the Board Meeting held on November 07 2015 Mrs. Parvati Nair was appointed asCompany Secretary and Compliance Officer of the Company with effect from October 26 2015in place of Ms. Romali M. Malvankar Company Secretary who has resigned.
The Board of Directors in its Meeting held on May 27 2016 approved retirement of Mr.Deepak A. Shah Chief Financial Officer of the Company w.e.f. June 30 2016 andappointment of Mr. B. K. Desai Sr. V.P.-Finance & Accounts as Chief Financial Officerw.e.f. July 012016 in place of Mr. Deepak A. Shah.
POLICIES AND PROCEDURES
The Policy of the Company on Directors' appointment including criteria for determiningqualifications positive attributes independence of a Director and the Policy onremuneration of Directors Key Managerial Personnel and other employees are provided inthe Corporate Governance Report annexed to this Report.
ANNUAL EVALUATION OF THE BOARD COMMITTEES AND INDIVIDUAL DIRECTORS
The Board of Directors of the Company has initiated and put in place evaluation of itsown performance its committees and individual directors. The result of the evaluation issatisfactory and meets the requirement of the Company.
SEPARATE MEETING OF THE INDEPENDENT DIRECTORS
In the separate meeting of the Independent Directors held on May 27 2016 performanceof the Non-Independent and Executive Directors performance of the Board as a whole andperformance of the Chairman in particular was evaluated taking into account the views ofExecutive Director and Non-Executive Directors. The result of the evaluation issatisfactory and meets the overall requirement of the Company.
During the year the management reviewed and strengthened its risk management policyand the risk management framework which ensures that the Company is able to carry outidentification of elements of risk if any which in the opinion of the Board may threatenthe existence of the Company.
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
The Company has established and maintained adequate internal financial controls withrespect to financial statements. Such controls have been designed to provide reasonableassurance with regard to providing reliable financial and operational information. Duringthe year such controls were operating effectively and no material weaknesses wereobserved.
VIGIL MECHANISM/ WHISTLEBLOWER POLICY
The Company has established its vigil mechanism in form of Whistle Blower Policy forDirectors and employees to report their genuine concerns about unethical behaviour actualor suspected fraud or violation of the Company's Code of Conduct or ethics policy detailsof which are provided in the Corporate Governance Report which forms part of this Report.
The Policy provides for adequate safeguards against victimization ofdirectors/employees who avail of the mechanism and also provides for direct access to theChairman of the Audit Committee.
The Whistle Blower Policy has been placed on the Company's website and is accessible at
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY
The Board has formulated a Corporate Social Responsibility Policy. The provisionsrelated to CSR activities are not applicable to the company during the Financial Year2015-16. However company has made spent a sum of Rs. 5 lacs during the FY 2015-16.
OTHER STATUTORY DISCLOSURES
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions that were entered into during the financial year were onan arm's length basis and in the ordinary course of business. Pursuant to Regulation 23 ofthe Listing Regulations and Section 177 of the Act prior approval of theAudit Committeeis obtained for all related party transactions. A statement of all Related PartyTransactions is placed before the Audit Committee for its review on a quarterly basisspecifying the nature value and terms and conditions of the transactions.
Your Company has adopted a Policy on Related Party Transactions. The Policy asapproved by the Board is available on the Company's website and the same is accessible athttp://www.imp-powers.com/pdf/Policies/Policy%20on%20Related%20Party%20Transactions IMP%20Powers%20Ltd.pdf
The details of material contracts or arrangement or transactions entered into by yourCompany on arm's length basis are provided in Form No. AOC-2 which is annexed as AnnexureD to this Report.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The Company has not given any loans during the year. The details of investments made inunlisted subsidiary of your Company during the year are given hereunder -
The details of guarantees provided during the year are given hereunder -
Details of loans guarantees and investments covered under the provisions of Section186 of the Companies Act 2013 (the Act') are given in the notes to the financialstatements.
PUBLIC DEPOSITS/ LOANS & ADVANCES
Your Company has not accepted any deposits from the public or its employees during theyear under review in accordance with the provisions of Chapter V of the Act. The Companyhas not given any loans/advances to its subsidiary the particulars of which are requiredto be disclosed in the financial statements pursuant to Regulation 34 of the ListingRegulations.
DISCLOSURES AS PER THE SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has zero tolerance for sexual harassment at workplace and has adopted aPolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 and the Rules there under for prevention andredressal of complaints of sexual harassment at workplace. The objective of this policy isto lay clear guidelines and provide right direction in case of any reported incidence ofsexual harassment across the Company's offices and take appropriate decision in resolvingsuch issues.
During the year under review no complaints were registered requiring investigation andredressal.
PARTICULARS OF EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rules 5(1) and 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed as Annexure B to thisReport.
CONSERVATION OF ENERGY TECHNOLOGYABSORPTIONAND FOREIGN EXCHANGE EARNINGSAND OUTGO
Information on Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rules 2014 are annexed as Annexure-G to thisReport.
SIGNIFICANT OR MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT
There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of the Company and its future operations.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Act and Rule 12(1) of the Companies (Management andAdministration) Rules 2014 the extract of Annual Return in Form No. MGT-9 is annexed as Annexure-Fto this Report.
Statutory Auditors and Statutory Audit Report
In accordance with the provisions of Section 139 of the Companies Act 2013 read withRule 3 of the Companies (Audit and Auditors) Rules 2014 M/s Batliboi & PurohitChartered Accountants were appointed as Statutory Auditors of the Company in the 52ndAnnual General Meeting held on September 30 2014 to hold office from the conclusion ofthe 53rd Annual General Meeting till the conclusion of the 55th Annual General Meeting ofthe Company subject to ratification of their appointment by the Members at every AnnualGeneral Meeting held after the 52nd Annual General Meeting.
Accordingly a proposal seeking Members' ratification for the appointment of M/sBatliboi & Purohit CharteredAccountants as the Statutory Auditors of the Company andfor fixing their remuneration for the remaining tenure forms part of the Notice conveningthe ensuing Annual General Meeting. Pursuant to the provisions of Sections 139 and 141 ofthe Companies Act 2013 read with Rule 4 of the Companies (Audit and Auditors) Rules2014 the Company has received consent from them to the effect that their appointment ifmade will be within the prescribed limits under the Companies Act 2013 and that they arenot disqualified for appointment. As required under Regulation 33 of the ListingRegulations they have also confirmed that they hold a valid certificate issued by thePeer Review Board of the Institute of Chartered Accountants of India. The Audit Committeeand Board of Directors have reviewed their eligibility criteria as laid down under Section141 of the Companies Act 2013 and recommended the ratification of their appointment asStatutory Auditors for the remaining tenure. No frauds have been reported by the StatutoryAuditors during the financial year 2015-16 pursuant to the provisions of Section 143(12)of the Companies Act 2013.
The Auditors' Report for the financial year ended March 31 2016 does not contain anyqualification reservation adverse remark or disclaimer.
Cost Auditors and Cost Audit Report
In accordance with the provisions of Section 148 of the Companies Act 2013 read withRule 14(a) of the Companies (Audit and Auditors) Rules 2014 the Board of Directors hason the recommendation of the Audit Committee appointed M/s V.J. Talati & Co. CostAccountants as Cost Auditors of the Company for the financial year 2016-17 at aremuneration of 50000/- plus service tax as applicable subject to ratification of suchremuneration by the Members in the ensuing Annual General Meeting.Accordingly aresolution seeking Members' ratification for the remuneration payable to the Cost Auditorsforms part of the Notice convening the ensuing Annual General Meeting.
The Company has filed the Cost Audit Report for the financial year ended March 312015on September 30 2015. The CostAudit Report for the financial year ended March 312016shall be filed in due course.
Secretarial Auditors and Secretarial Audit Report
In accordance with the provisions of Section 204 of the Companies Act 2013 read withthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors has appointed M/s Dhirendra Maurya & Associates Practicing CompanySecretaries as Secretarial Auditors of the Company for the financial year 2016-17.
The Secretarial Audit Report for the financial year ended March 312016 is set out in Annexure-Cto this Report. The Secretarial Audit Report does not contain any qualificationreservation adverse remark or disclaimer.
Pursuant to the provisions of Section 138(1) of the Companies Act 2013 read with Rule13 of the Companies (Accounts) Rules 2014 the Company has appointed M/s Bathiya &Associates LLP Chartered Accountants as Internal Auditor of the Company for the financialyear 2016-17. The Audit Committee in its Meeting held on May 27 2016 has recommendedtheir appointment as InternalAuditors of the Company.
DIRECTORS RESPONSIBILITY STATEMENT
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the statutory cost andsecretarial auditors and external consultant(s) and the reviews performed by Managementand the relevant Board Committees including the Audit Committee the Board is of theopinion that the Company's internal financial controls were adequate and effective duringthe financial year 2015-16.
Accordingly pursuant to the provisions of Section 134 of the Companies Act 2013 yourDirectors to the best of their knowledge and belief and according to information andexplanation obtained by them confirm that:
i. in the preparation of the annual financial statements for the year ended March312016 the applicable accounting standards have been followed and there are no materialdepartures;
ii. they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year ended March312016 and of the profit for the Company for that period;
iii. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv. they have prepared the annual financial statements on a going concern basis;
v. they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively;
vi. They have devised systems to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
MANAGEMENT DISCUSSIONAND ANALYSIS REPORT
A detailed report on Management Discussion and Analysis as required under Regulation34(2)(e) of the Listing Regulations for the year under review is presented in a separatesection forming part of the Annual Report.
A Report on Corporate Governance appears after this Report. A certificate from M/sBatliboi & Purohit Chartered Accountants with regard to compliance with the ScheduleV of the Listing Regulations by the Company is annexed hereto and forms part of thisReport.
The Company has complied with mandatory requirements prescribed under Schedule V of theListing Regulations entered with the BSE Limited ("BSE") and the National StockExchange of India Limited ("NSE"). The Company has also implemented some of thenon-mandatory provisions as contained in Schedule V of the Listing Regulations.
The properties and all insurable assets of your company are adequately insured.
Your company continues to place significant importance on its Human Resources enjoyscordial relations at all levels and recognises that personnel are its principal assets.The company also believes that its growth is always depends upon its ability to attractsand retain good quality personnel. A full-fledged Human Resources department has been setup which is entrusted with the responsibility of recruiting new talent from the marketretaining and developing skills of the employees if company by conducting varioustrainings on its in-house training center at Silvassa Factory. Your company's industrialrelations at all divisions continued to be harmonious and cordial during the year.
The Industrial Relations continued to be generally peaceful and cordial.
Your Directors wish to place on record their sincere appreciation of the assistance andsupport extended by the employees shareholders customers financial institutions banksvendors dealers the Central and State Governments and others associated with theactivities of the Company. We look forward to their continued support in future. YourDirectors wish to place on record their appreciation for the contribution made byemployees at all levels to the continued growth and prosperity of your company.
For and on Behalf of Board of Directors
Ramniwas R Dhoot
Date: 12th August 2016