The Directors present their forty-second (42nd) Annual Report and Audited FinancialStatements for the year ended 31 March 2017 prepared in due compliance of extantprovisions of the Companies Act 2013 and Schedule III thereto.
REVIEW OF OPERATIONS:
During the year under review the business activities of the Company continued to berestricted to the (i) manufacture of die casting dies jigs and fixtures primarily meantfor the automobiles industry and (ii) treasury operations involving management of surplusfunds invested by the Company.
Sales attributed to manufacture of die casting dies jigs and fixtures were marginallylower at Rs.843.29 lakhs as compared to Rs.892.96 lakhs during the previous year.
The turnover of the Company during the year under review amounted to Rs.2923.63 lakhsas against Rs.11714.99 lakhs during the previous year which included additional dividendreceived during that year by way of interim dividend and consequently the figures are notstrictly comparable.
CLASSIFICATION AS A CORE INVESTMENT COMPANY:
The Company continued to fulfill the criteria for being classified as a Core InvestmentCompany (CIC) exempted from registration with Reserve Bank of India pursuant to section45-IA of RBI Act 1934. The continued classification of the Company as a Core InvestmentCompany however had no significant impact on the operations/finances of the Company.
(' in lakhs)
| ||2016-17 ||2015-16 |
|Net sales and other income ||2923.63 ||11714.99 |
|Gross profit before depreciation ||1425.20 ||10173.38 |
|Depreciation ||55.32 ||73.50 |
|Profit before tax ||1369.88 ||10099.88 |
|Tax expense ||148.00 ||116.00 |
|MAT credit entitlement ||(34.00) ||(116.00) |
|Profit after tax ||1255.88 ||10099.88 |
|Earnings per Share (') ||10.99 ||88.37 |
RECOMMENDATION ON DIVIDEND:
For the financial year ended 31 March 2017 the Directors are pleased to recommend forconsideration of the Shareholders at the ensuing Annual General Meeting payment ofdividend @ Rs.30 per share (300%) on 11428568 equity shares of '10 each. For thefinancial year ended on 31 March 2016 the Company had paid interim dividend @ Rs.30 pershare (300%) which was confirmed by the Shareholders as final dividend.
The amount of dividend inclusive of tax thereon for the financial year 2016-17 amountsto Rs.4126.55 lakhs same as paid during the financial year 2015-16.
The paid up Equity Share Capital as on 31 March 2017 was Rs.11.42 crores. During theyear under review there was no public issue rights issue bonus issue or preferenceshare issue nor had the Company issued shares with differential voting rights or grantedstock options or sweat equity.
PRESENTATION OF FINANCIAL STATEMENTS:
The financial statements for the year ended 31 March 2017 are prepared in duecompliance of the Schedule III to the Companies Act 2013.
CASH FLOW STATEMENT:
A Cash Flow Statement for the year 2016-17 is included in the annexed Statement ofAccounts.
EXTRACT OF ANNUAL RETURN:
Pursuant to the provisions of section 92(3) of the Companies Act 2013 and Rules framedthereunder an extract of Annual Return as on 31 March 2017 in the prescribed Form No.MGT-9 is annexed to this Report (Annexure-I).
NUMBER OF MEETINGS OF THE BOARD:
There were four (4) meetings of the Board held during the year. Detailed information isgiven in the annexed Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
As required pursuant to clause (c) of sub-section (3) of section 134 of the CompaniesAct 2013 the Directors to the best of their knowledge and belief state that-
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departure;
(b) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
(c) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis;
(e) the directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls were adequate and were operatingeffectively; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DETAILS IN RESPECT OF FRAUDS IF ANY REPORTED BY THE AUDITORS:
No offence involving fraud committed against the Company by officers or employees ofthe Company was reported by the Auditors to the Audit Committee or the Board pursuant tosection 143(12) of the Companies Act 2013.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
All the Independent Directors have submitted declarations to the Company to the effectthat they meet the criteria of independence as provided in sub-section (6) of section 149of the Companies Act 2013.
DIRECTORS' APPOINTMENT AND REMUNERATION POLICY:
Information regarding Directors' Remuneration Policy and criteria for determining thequalification positive attributes independence of a director and other matters providedunder sub-section (3) of section 178 of the Companies Act 2013 are contained in theCorporate Governance Report. The Policy is also available on the website of the Companyi.e. www.mahascooters.com
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The Company has not given any loans or provided any security. Full particulars of theinvestments made by the Company are provided in the Financial Statements attached to thisReport.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
During the year under review the Company had not entered into any transactions withthe related parties which invoked the provisions of section 188 of the Companies Act2013 thereby necessitating its approval by the Board or prior approval of theShareholders.
There being no such contract with related parties which are 'material' in naturethere are no details to be disclosed in Form AOC - 2 under the Companies Act 2013.
Pursuant to the provisions of section 177 of the Companies Act 2013 and Regulation 23of the SEBI Listing Regulations all Related Party Transactions were placed before theAudit Committee for its prior/omnibus approval.
The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website www.mahascooters.com
DETAILS PURSUANT TO RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES 2014:
|Conservation of energy ||The Company continued to maintain power factor to unity throughout the year resulting in getting maximum rebate in electricity bills. Company has initiated steps to introduce energy saving LED lamps in a phased manner all over the factory premises. |
|Technology absorption ||No expenditure was incurred by the Company attributable to technology absorption during the year. |
|Expenditure on Research & Development ||No expenditure was incurred by the Company attributable to Research & Development during the year. |
|Foreign exchange earnings and Outgo ||The Company did not earn any foreign exchange while the outgo was Rs.36.15 lakhs. |
ANNUAL EVALUATION OF THE BOARD COMMITTEES AND INDIVIDUAL DIRECTORS:
Pursuant to provisions of the Companies Act 2013 and Regulation 25(4) of the ListingRegulations the Board has carried out an annual performance evaluation of its ownperformance the Directors individually as well as the evaluation of the working of itsCommittees. The manner in which formal annual evaluation was made is provided in theannexed Corporate Governance Report.
DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR RESIGNED DURINGTHE YEAR:
a) Mrs. Charu Desai one of the Independent Directors of the Company and Woman Directoron its Board resigned during the year owing to personal reasons. The Board records itssincere appreciation of the valuable contribution made by Mrs. Charu Desai during hertenure on the Board.
b) On the recommendations of Nomination and Remuneration Committee the Board at itsmeeting held on 24 January 2017 appointed Mrs. Richa Bagla as an IndependentDirector/Woman Director for a period of 5 years effective 24 January 2017 subject tothe approval of the Shareholders at the ensuing Annual General Meeting.
c) There was no change in the Key Managerial Personnel during the period under review.
d) In light of provisions of the Companies Act 2013 Shri Sanjiv Bajaj retires fromthe Board by rotation this year and being eligible offers himself for re-appointment. Theinformation as required to be disclosed under regulation 36(3) of the SEBI ListingRegulations 2015 in case of re-appointment of the director is provided in the Notice ofthe ensuing annual general meeting.
e) Detailed information on the directors is provided in the Corporate GovernanceReport.
MATERIAL ORDERS IF ANY PASSED BY THE REGULATORS COURTS ETC.:
No material Orders were passed by any Regulators or Courts or Tribunals during thefinancial year under review impacting the going concern status of the Company's operationsin future.
DETAILS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:
The Company has documented its Internal Financial Controls considering the essentialcomponents of various critical processes physical and operational and which includes itsdesign implementation and maintenance along with periodical internal review ofoperational effectiveness and sustenance during the financial year 2015-16. The controlsand processes remained unchanged during the year 2016-17 and as such the internalfinancial controls with reference to financial statements were adequate and operativeeffectively during the year 2016-17.
This ensures orderly and efficient conduct of its business including adherence toCompany's policies safeguarding of its assets prevention of errors accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation.
The internal financial controls with reference to the financial statements wereadequate and operating effectively.
RISK MANAGEMENT POLICY:
The Company has adopted a Risk Management Framework for the Company includingidentification therein of elements of risk if any which in the opinion of the Board maythreaten the existence of the Company.
MATERIAL CHANGES AND COMMITMENTS:
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company andthe date of this report.
In terms of Regulation 34 of Listing Regulations a Report on Corporate Governancetogether with the Auditors' Certificate thereon Management Discussion and Analysis Report& CSR Report forms integral part of Corporate Governance Report.
BUSINESS RESPONSIBILITY REPORT:
Pursuant to Regulation 34(2) of the SEBI Listing Regulations 2015 Annual Report oftop 500 listed companies by market capitalization calculated as on 31 March of everyfinancial year are required to include a Business Responsibility Report describingtherein the initiatives taken by them from environmental social and governanceperceptive in the format prescribed by SEBI.
For the financial year ended 31 March 2016 the name of your Company was listed in thetop 500 companies by market capitalization and consequently as part of the Annual Reportfor the financial year 2016-17 the Company has presented its first BusinessResponsibility Report.
In its quest of Green Initiative the Company has hosted the Business ResponsibilityReport on its website viz. www.mahascooters.com On request a physical copy ofsaid Report would be made available to any Shareholder free of cost.
SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of section 204 of the Companies Act 2013 the Company hadappointed Shri Shyamprasad D. Limaye a Fellow Member of the Institute of CompanySecretaries of India and a Company Secretary in Practice (FCS No.1587 Certificate ofPractice No. 572) to conduct the secretarial audit and give a Secretarial Audit Reportfor the year 2016-17 to be annexed to the Report of Board of Directors. Secretarial AuditReport of Shri Shyamprasad D. Limaye in the prescribed Form MR-3 is annexed to this Report(Annexure-II). The Report does not contain any qualification reservation disclaimer oradverse remarks.
SECRETARIAL STANDARDS OF ICSI:
The Company is in compliance of Secretarial Standards on Meetings of the Board ofDirectors (SS-1) and General Meetings (SS-2) issued by the Institute of CompanySecretaries of India.
The current Auditors were last re-appointed by the Members at their Annual GeneralMeeting held on 25 July 2016 to hold the office of Auditor from the conclusion of the41st Annual General Meeting till the conclusion of this 42nd Annual General Meeting. Asper the provisions of section 139 Companies Act 2013 no listed company shall appoint anaudit firm as auditors for more than two terms of five consecutive years. The Act alsoprovided for additional transition period of three years from the commencement of the Acti.e. 1 April 2014. The current Auditors had completed a period of ten years at thecommencement of the said Act and hence on their completing the additional transitionperiod of three years provided under the Act the term of the current Auditors expires atthe conclusion of the ensuing Annual General Meeting.
The Board of Directors at its meeting held on 16 May 2017 based on the recommendationof the Audit Committee has recommended the appointment of M/s. Kirtane & Pandit LLPChartered Accountants (Firm Registration No.105215W/W100057) as the Statutory Auditors ofthe Company for approval by the members.
M/s. Kirtane & Pandit LLP Chartered Accountants have consented to the saidappointment and confirmed that their appointment if made would be within the limitsspecified under section 141(3)(g) of the said Act and that they are not disqualified to beappointed as statutory auditors in terms of section 143 of the Act.
M/s. Kirtane & Pandit LLP Chartered Accountants will be appointed as the statutoryauditors of the Company from the conclusion of 42nd Annual General Meeting till theconclusion of 47th Annual General Meeting covering one term of five consecutive yearssubject to ratification by the members at each intervening Annual General Meeting on suchterms and conditions as may be mutually agreed.
The members are therefore requested to appoint M/s. Kirtane & Pandit LLPChartered Accountants (Firm Registration No.105215W/W100057) as auditors of the Companyfor a term of five years from the conclusion of the ensuing annual general meeting tillthe conclusion of the 47th annual general meeting to be scheduled in 2022 subject toratification at each annual general meeting and to fix their remuneration for the year2017-18.
The Statutory Audit Report does not contain any qualification reservation or adverseremark or disclaimer made by Statutory Auditor.
During the year under review the Company had an amicable wage settlement agreementwith the Workmen valid through 30 September 2019 and the relations with the Workmenremained cordial.
ESTABLISHMENT OF VIGIL MECHANISM:
Pursuant to the provisions of section 177(9) of the Companies Act 2013 and Rulesframed thereunder the Company has established a vigil mechanism for directors andemployees to report genuine concerns and to provide for adequate safeguards againstvictimizations of persons who use such mechanism and the details thereof are disclosed onthe website of the Company www.mahascooters.com
DETAILS OF DIRECTORS AND EMPLOYEES REMUNERATION:
Details as required under the provisions of section 197(12) of the Companies Act 2013read with rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are annexed to this Report (Annexure-III).
During the year under review none of the employees of the Company was in receipt ofremuneration as referred to in section 197(12) of the Companies Act 2013 read with Rule5(2) and (3) of the Rules aforesaid.
CORPORATE SOCIAL RESPONSIBILITY (CSR) REPORTING:
Detailed information on Corporate Social Responsibility Policy developed andimplemented by the Company on CSR initiatives taken during the year pursuant to section135 of the Companies Act 2013 is given in the Annual Report on CSR activities annexed tothis Report (Annexure-IV).
| ||On behalf of the Board of Directors |
| ||Madhur Bajaj |
|Pune 16 May 2017 ||Chairman |