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Rajasthan Tube Manufacturing Co Ltd.

BSE: 530253 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE497E01012
BSE LIVE 15:14 | 08 Dec 13.66 0.65
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VOLUME 100
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P/E
Mkt Cap.(Rs cr) 6
Buy Price 13.66
Buy Qty 900.00
Sell Price 0.00
Sell Qty 0.00
OPEN 13.66
CLOSE 13.01
VOLUME 100
52-Week high 18.80
52-Week low 12.03
P/E
Mkt Cap.(Rs cr) 6
Buy Price 13.66
Buy Qty 900.00
Sell Price 0.00
Sell Qty 0.00

Rajasthan Tube Manufacturing Co Ltd. (RAJASTUBEMFG) - Director Report

Company director report

Dear Shareholders

Your Directors have pleasure in presenting their 31st Annual Report on the businessesand operations of your company together with audited statement of accounts for the yearended on 31st March 2017.

1. FINANCIAL PERFORMANCE:

For the year ended on 31.3.2017 For the year ended on 31.3.2016
(Rs. in (Rs. in
Lacs) Lacs)
Total Sales & Other Income 7394.14 8094.78
Profit Before Interest & Depreciation 68.40 167.21
Interest 239.37 237.52
Profit/(Loss)Before Depreciation (170.97) (70.31)
Depreciation 12.77 16.98
Profit/ (Net Loss) before Taxation (183.74) 87.29
Provision for Taxation - -
Deferred Tax (Net) (56.78) (110.30)
Profit/ (Net Loss) after Taxation (126.96) 23.01
Bal brought forward from previous year 250.56 227.55
Profit available for appropriation - 250.56
Balance carried to Balance Sheet 123.60 250.56

2. DIVIDEND:

Your Directors are unable to recommend any dividend during the year under review inview of Losses.

3. AMOUNT TRANSFER TO RESERVES:

In view of the losses your Board of Directors does not appropriate any amount to betransferred to General Reserves during the year under review.

4. STATE OF COMPANY'S AFFAIR:

During the year under review the sales and other income during the year decreased toRs.7394.14 Lacs as compared to Rs. 8094.78 Lacs in the previous year. The loss after taxduring the year is Rs. 126.96 lacs as compared to a profit of Rs.23.01 lacs in theprevious year.

5.CHANGE IN THE NATURE OF BUSINESS:

In pursuance to Rule 8 (5) of the Companies (Accounts)Rules 2014 there is no changein the nature of business in the year under review.

6.MATERIAL CHANGES & COMMITMENTS:

In pursuance to Section 134(3) (L) of the Companies Act 2013 No material changes andcommitments have occurred after the close of the year till the date of this report whichaffect the financial position of the company.

7.MATERIAL ORDERS:

In pursuance to Rule 8 (5) (vii) of the Companies (Accounts)Rules 2014 No significantor material orders were passed by the Regulators or courts or tribunals which impact thegoing concern status and company's operation in future.

8. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has an Internal Control System commensurate with the size scale complexityof its operations. The company has formulated Internal Financial Control policy accordingto Sec 134(5) (e) of the Companies Act 2013. The Company has in place adequate internalfinancial controls with reference to financial statements. During the year such controlswere tested and no reportable material weakness in the design or operation was observed.

9.DETAILS / FINANCIAL POSITION OF SUBSIDIARY / JOINT VENTURE/ ASSOCIATE COMPANY:

The company does not have any Subsidiary/ Associate or Joint Venture.

10. DEPOSITS:

The Company has not invited or accepted any fixed deposit during the year as per theprovisions of Section 73 (2) of the Companies Act 2013 and rules made there under.

11. STATUTORY AUDITORS:

In the last AGM held on 24th September 2016 M/s Giriraj & LohiyaChartered Accountants Jaipur Statutory Auditors (FRN-006031C) were appointed statutoryauditors of the Company for a period of five years. Ratification of appointment ofStatutory Auditors is being sought from the members of the Company at the ensuing AGM.

12. EXPLAINATION TO AUDITORS REMARK:

The observations of the Auditors have been suitably dealt within the notes on accounts.The Auditor's Report does contain one qualification reservation or adverse remark whichhas been suitably explained at Note No.-28. Further there was no fraud in the Companywhich was required to be reported by Statutory auditors of the Company under Section 143(12) of the Companies Act 2013.

13. COST AUDITOR:

Pursuant to the provisions of Section 148(2) of the Companies Act 2013 read withCompanies (Cost Records and Audit) Amendment Rules 2014 required to have the audit ofits cost records conducted by a Cost Accountant in practice. In this connection the Boardof Directors of the Company has on the recommendation of the Audit Committee approved there-appointment of M/s. G.K. Gupta & Company (Firm Registration No. 100205) CostAccountants as the Cost Auditors of the Company for the year ending 31 March 2018. Theremuneration proposed to be paid to the Cost Auditor requires ratification in terms ofSection 148 read with Rule 14 of the Companies (Audit & Auditors) Rules 2014 and isaccordingly forms part of the notice convening the AGM.

14. SECRETARIAL AUDIT REPORT:

As per the requirement of Section 204 (1) of the Companies Act 2013 and Rule 9 of theCompanies (Appointment and Remuneration Personnel) Rules 2014 the Company has obtained aCertificate from Ms. MEGHA KHANDELWAL Company Secretary in Whole Time Practiceconfirming that the Company has complied with the provisions of the Companies Act 2013 inthe Financial Year 2016-2017 and a copy of the Secretarial Audit Report is annexed to thisReport as Annexure- III. The Secretarial Audit Report is self-explanatory and doesnot contain any qualification reservation or adverse remark.

15. SHARE CAPITAL:

There was no change in the Company's share capital during the year under audit. Thepaid-up equity share capital as on 31st March 2017 was Rs.44998500. During theyear under review the company has neither issued shares with differential voting rightsnor granted stock options and sweat equity. As on March 31 2017 none of the Directors ofthe company hold any convertible instruments of the company.

16. EXTRACT OF ANNUAL RETURN:

Extract of Annual Return of the company as provided under section 92(3) CompaniesAct 2013 and rule 12 (1) of the Companies (Management and Administration) Rules 2014 isannexed herewith as Annexure-I in the prescribed Form MGT-9 to this Report.

17.PARTICULARS OF ENERGY CONSUMPTION ETC:

a)CONSERVATION OF ENERGY: The information pursuant to sub-section 3(m) of section 134of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 is either nil ornot applicable. However the company is conscious about its responsibility to conserveenergy power and other energy resources wherever applicable. b)TECHNOLOGY ABSORPTION:Your Company has not imported any technology in the year under review. c)FOREIGN EXCHANGEEARNING & OUTGO: There was no inflow and outflow of Foreign Exchange during the year.

18. CORPORATE SOCIAL RESPONSIBILITY:

The provisions of CSR are not applicable to the company for the Financial Year2016-2017 as the company does not fall under the provisions of Section 135 of theCompanies Act 2013.

19. DIRECTORS AND KEY MENERGRIAL PERSONNEL:

a)Directors-In accordance with the provisions of the Act and the Articles ofAssociation of the Company Smt. Rajshree Patni Director of the Company retire byrotation at the ensuing Annual General Meeting and being eligible has offer herself forre-appointment.

b)Declaration by Independent Directors-The Company has received declarations fromall the Independent Directors of the Company confirming that they meet the criteria ofindependence as specified in Section 149(6) of the Companies Act 2013 and under SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.

c)Key managerial Personnel-Pursuant to the Provisions of Section 203 of thecompanies Act 2013 the Key Managerial Personnel of the company are Mr. Harish Chand Jain(Chairman & Managing Director) Mr. Pradeep Jain (Chief Financial Officer) and Ms.Komal Jain (Company Secretary). During the year Ms. Komal Behl Company Secretary hasresigned on 01.10.2016 in place of her Ms. Komal Jain has been appointed as CompanySecretary of the Company w.e.f. 11.11.2016.

20.POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:

Matching the needs of the Company and enhancing the competencies of the Board are thebasis for the Nomination and Remuneration Committee to select a candidate for appointmentto the Board. The current policy is to have a balance mix of executive and non-executiveIndependent Directors to maintain the Independence of the Board and separate its functionof governance and management. As at 31 March 2017 the Board of Directors comprises of 5Directors including 1 women Director of which 3 are non-executive. The number ofIndependent Directors is 3 which is one half of the total numbers of Directors The Policyof the Company on Directors appointment including criteria for determining qualificationspositive attributes independence of Directors and other matters as required under Section178 of Companies Act 2013 is governed by Nomination Policy read with Company's policy onappointment/reappointment of Independent Directors. The remuneration paid to the Directorsis in accordance with the remuneration policy of the Company.

21.PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE:

The Company is committed to provide a safe and conducive work environment to itsemployees.Your Directors further state that during the year under review there were nocases filed pursuant to the Sexual harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.

22. EVALUATION OF BOARDS PERFORMANCE:

The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual directors pursuant to the provisions of the Act and SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The performance ofthe Board was evaluated by the Board after seeking inputs from all the directors on thebasis of the criteria such as the Board composition and structure effectiveness of boardprocesses information and functioning etc. The performance of the committees wasevaluated by the board after seeking inputs from the committee members on the basis of thecriteria such as the composition of committees effectiveness of committee meetings etc.The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual directors on the basis of the criteria such as thecontribution of the individual director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc. In addition the Chairman was also evaluated on the key aspectsof his role.

In a separate meeting of independent Directors performance of non-independentdirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting and Nomination and Remunerationmeeting that followed the meeting of the independent Directors at which the performanceof the Board its committees and individual directors was also discussed.

23.NO. OF BOARD MEETINGS:

During the year 2016-2017 5 (Five) meetings of the Board of Directors were held duringthe year. The intervening gap between the meeting was within the period prescribed underCompanies Act 2013 and regulation 17 of SEBI (LODR) Regulation 2015. Apart from this onemeeting of Independent Directors was also held during the year.

24.AUDIT COMMITTEE:

The Audit Committee comprises Independent Directors namely Shri Sunil Kumar Jain(Chairman) Shri Deepesh Jain and Shri Mahendra Kumar Jain as other members. All therecommendations made by the Audit Committee were accepted by the Board.

25.VIGIL MECHANISM/ WHISTLE BLOWER POLICY:

The company has a vigil mechanism policy to deal with instance of fraud andmismanagement if any. The detail of the policy is posted on the website of the companyweblink for the same is http://rajtube.com/data/blower.pdf.

26.NOMINATION & REMUNERATION COMMITTEE:

The Nomination & Remuneration Committee comprises Independent Directors namely ShriDeepesh Jain (Chairman) Shri Sunil Kumar Jain and Shri Mahendra Kumar Jain as othermembers.

27.PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES

GIVEN AND SECURITIES PROVIDED:

There is no outstanding loan & guarantee at the year end as prescribed undersection 186 of the Companies Act 2013. The company has not made any investment during theyear as prescribed under section 186 of the Companies Act 2013.The details of investmentsheld as on 31.03.2017 are given in Financial Statements.

28.CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES:

The Board of Directors of the Company as per the provisions of Regulation 23 of theListing Regulations has formulated a policy on Material Related Party Transactions. Thesaid policy is available on the website of the Company www.rajtube.com. During the yearthere have been no materially significant related party transactions undertaken by theCompany under Section 188 of the Companies Act 2013 and Regulation 23 of the ListingRegulations that may have potential conflict with the interest of the Company at large.Form No. AOC-2 which forms part of the Board's Report is annexed herewith as Annexure -II. Also refer note no. 32 of the financial statements as at 31st March 2017 whichforms part of this Annual Report for details of related party transactions.

29.MANAGERIAL REMUNERATION/PARTICULARS OF EMPLOYEES:

A. The information required under Section 197 of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow: I. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:

EXECUTIVE DIRECTORS RATIO TO MEDIAN
REMUNERATION
Mr. Harish Chand Jain 3.19
Mrs. Rajshree Patni -

Non- executive directors and Mrs. Rajshree Patni are only being paid sitting fees. Theydo not draw any remuneration. II. The remuneration of any of the directors/CFO/CS did notincrease in the relevant financial year. III. The percentage increase in the medianremuneration of employees in the

Financial Year:

Median Remuneration at the end of F.Y. 2015-2016 Median Remuneration the end of 2016-2017 at F.Y. % increase in the median remuneration of employees
192000 225235 17.30

*While calculating median remuneration remuneration of only those employees isconsidered who were in employment for the complete financial year 2016-2017. IV. Thenumber of permanent employees on the payroll of the company at the end of the relevantfinancial year: 28 V. There is no increase in the remuneration of employees or Keymanagerial personnel hence comparison is not made. VI. There is no variable component ofremuneration availed by directors in the relevant financial year.

VII. The company affirms the remuneration is as per the remuneration policy of thecompany. VIII. None of the directors of the company (MD or WTD) receives any commissionfrom company. IX. None of the employee of the Company is drawing more than Rs.10200000/-per annum or Rs 850000/- per month or for the part of the year during the year underreview therefore particulars of the employees as required under section 197 of theCompanies Act2013 read with rule 5(2) & rule 5 (3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are not applicable during the year underreview.

B. Details pursuant to section 197 (12) of the Companies Act2013 read with the rule 5(2) of the companies (Appointment and Remuneration of Managerial Personnel) AmendmentRules 2016.

NAME AGE REMUNERA TION RECEIVED (PER ANNUM) DESIGNATION NATURE OF EMPLOYMENT QUALIFI CATION COMMENCEM ENT OF EMPLOYMEN LAST EMPLOYMENT % OF EQUIT Y SHARE S HELD WHE THE R REL ATI VE OF DIR ECT OR
SAURABH JAIN 33 480000/- Marketing manager ONROLL EMPLOYEE B.COM March 2014 Unemployed 2.40 % YES
PRADEEP JAIN 37 480000/- CFO ONROLL EMPLOYEE B.COM October 2014 Unemployed 4.24% YES
KOMAL JAIN 26 102667/- COMPANY SECRETARY ONROLL EMPLOYEE M.COM CS Nov 2016 Unemployed - NO
Jagdish 57 224879/- Space Supervisor ONROLL EMPLOYEE SECONDAR Y March 2014 Unemployed - NO
SAROJ JAIN 44 228596/- Office Assistant ONROLL EMPLOYEE B.A. March 2014 Unemployed - NO
SHUBH KARAN 54 227199/- Quality controller ONROLL EMPLOYEE B.A. March 2014 Unemployed - No
RADHE 55 225235/- Mill ONROLL SENIOR Feb 2014 Unemployed - NO
SHYAM Supervisor EMPLOYEE SECONDAR Y
SHASHANK JAIN 47 229335/- General Manager ONROLL EMPLOYEE B.COM March 2014 Unemployed - NO
BANSIDHA R YADAV 52 224189/- Accountant ONROLL EMPLOYEE B.A. Feb 2014 Unemployed - NO
BALDEV CHOUDHAR Y 52 223458/- Assistant Accountan t ONROLL EMPLOYEE B.A. Feb 2014 Unemployed - No

30.CORPORATE GOVERNANCE:

The company is committed to maintain the highest standard of Corporate Governance andadhere to the Corporate Governance requirement as set out by SEBI. As regards to theCorporate Governance Report as specified in Para C of Schedule V of SEBI (ListingObligations and disclosure Requirements) Regulations 2015 the same is not applicable tothe Company as the equity share capital of the company is less than Rs. 10 crore and networth is less than Rs. 25 crore.

31.RISK MANAGEMENT POLICY:

Pursuant to the requirement of Companies Act 2013 and of listing regulations thecompany has a robust Enterprise Risk Management framework to identify evaluate businessrisk & opportunities. This framework seeks to create transparency minimize adverseimpact on the business objectives and enhance the Company's competitive advantage. Thebusiness risk framework defines the risk management approach across the enterprise atvarious levels including documentation and reporting. The framework has different riskmodels which help in identifying risks trend exposure and potential impact analysis at aCompany level.

32.INSURANCE

The Property and assets of the Company are adequately financed.

33.DIRECTORS' RESPONSIBILITY STATEMENT:

In Pursuant to section 134(5) of the Companies Act 2013the board of directors to thebest of their knowledge and ability confirm that: a) in the preparation of theannual accounts for the year ended March 31 2017 the applicable accounting standardsread with requirements set out under Schedule III to the Act have been followed withproper explanation relating to material departures if any as stated in Note No-28 of theFinancial Statement; b) the Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company as at March 31 2017and of the loss of the Company for the year ended on that date; c) the Directors havetaken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding the assets of the Company andfor preventing and detecting fraud and other irregularities; d) the Directors haveprepared the annual accounts on a ‘going concern' basis; e) the Directors have laiddown internal financial controls to be followed by the Company and that such internalfinancial controls are adequate and are operating effectively; and f) the Directors havedevised proper systems to ensure compliance with the provisions of all applicable laws andthat such systems are adequate and operating effectively.

34.MANAGEMENT DISCUSSION & ANYLYSIS REPORT:

a) INDUSTRY STRUCTURE & DEVELOPMENT:

Activities of your company come under the category of steel tube industry. With theincreased activity in housing and agriculture the future of the steel tube industry shallcontinue to remain encouraging.

b) OPPORTUNITIES THREATS RISK & CONCERNS:

Presently major requirements of pipes in Rajasthan are being met through units situatedoutside Rajasthan. The pipes manufactured by the company would be able to competeeffectively in the market as they would have a clear price advantage over the otheroutside suppliers because of lower transportation cost benefits applicable to the company.The company's product shall enjoy 4% price preference and 80% purchase preference in allGovt. & semi Govt. organizations of Rajasthan Govt. Steel Tube and pipe industry isexpected to show good prospects in view of increased availability of H.R. Coils beingbasic raw material to manufacture M.S. Steel Tube. More units with similar facility maycome up resulting in greater competition and lower price realization. Changed state Govt.policies may affect the profitability of the company. The steel tube industry is subjectto market cycle and as constituent of the industry your company is also exposed to theseconstituents. Rise in price of H.R. Coils Zinc are also a matter of concern.

c) SEGMENT:

The operations of the company are covered in one segment only i.e. steel tube segment.

d) OUTLOOK:

Having regards to the prevailing circumstances your company visualizes a hopeful growthin the industry.

e) INTERNAL CONTROL SYSTEM:

Your company maintains an internal control system in different areas like purchasesbilling for the jobs etc. Moreover there are internal auditors who make consistentmonitoring to have proper and sufficient care for maintenance of adequate accountingrecords required for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities.

f) DEVELOPMENT: HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT:

Your Board has nothing to report on the development in human resource as wellindustrial relations front which have a material bearing on the business of the company.

g) DISCLOSURE BY THE MANAGEMENT:

Your board has not received any disclosure by the management relating to any materialfinancial and commercial transactions where any of the managerial staff has personalinterest that may have a potential conflict with the interest of the company at large.

35.LISTING OF SHARES:

The shares of the company are listed on the Bombay Stock Exchange Limited. The companyhas paid annual listing fees for the financial year 2017-2018.

36.FAMILIARIZATION OF INDEPENDENT DIRECTOR:

The details of familiarization pogromme for independent Directors have been disclosedon the website of the Company. Weblink for the same ishttp://rajtube.com/data/Familiarization.pdf

37.TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EUDCATION AND PROTECTION FUND:

The provision of section 125 (2) of the companies Act 2013 do not apply as there wasno dividend declared and paid last year.

38.ACKNOWLEDGEMENTS:

Your Directors are grateful to the Government authorities financial institutionsbankers business constituents for their continued co-operation and timely support to thecompany. Your Directors also express their deep appreciation for the devoted services byworkers staff and executives at all levels of operations in achieving the results for theyear. Industrial relations continued to remain happy and cordial.

For and on Behalf of the Board

(RAJSHREE PATNI) (HARISH CHAND JAIN)
(DIRECTOR) CHAIRMAN & MANAGING DIRECTOR
DIN NO.:06934858 DIN NO.: 01504391

Registered office: 404 Shekhawati Complex Station Road JAIPUR Dated: 5thAugust 2017

CEO / CFO CERTIFICATE

To

The Board of Directors

Rajasthan Tube Manufacturing Company Limited

We Harish Chand Jain Managing Director and Pradeep Jain Chief Financial Officer ofRajasthan Tube Manufacturing Company Limited certify that:

1. We have reviewed financial statements and the cash flow statement and Board's Reportof Rajasthan Tube Manufacturing Company Limited for the year ended 31st March 2017 and tothe best of our knowledge belief and information: i. These statements do not contain anymaterially untrue statement or omit any material fact or contain statements that might bemisleading; ii. These statements together present a true and fair view of the Company'saffairs and are in compliance with existing accounting standards applicable laws andregulations.

2. There are to the best of our knowledge and belief no transactions entered into bythe Company during the year which are fraudulent illegal or violative of the Company'sCode of Conduct.

3. We accept responsibility for establishing and maintaining internal controls forfinancial reporting and we have evaluated the effectiveness of Company's internal controlsystems pertaining to financial reporting. We have disclosed to the Auditors and AuditCommittee deficiencies in the design or operation of such internal controls if any ofwhich we are aware and the steps we have taken or propose to take to ratify thesedeficiencies.

4. We have indicated to the Auditors and the Audit Committee: i.that there are nosignificant changes in internal control over financial reporting during the year; ii.thatthere are no significant changes in accounting policies during the year; and iii.thatthere are no instances of significant fraud of which we have become aware.

Registered office: 404 Shekhawati Complex Station Road JAIPUR

PRADEEP JAIN (HARISH CHAND JAIN) Dated: 30th May 2017 (CHIEF FINANCIALOFFICER) CHAIRMAN & MANAGING DIRECTOR DIN NO.:01504391

DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITHTHE COMPANY'S CODE OF CONDUCT:

This is to confirm that the Board of Directors of the Company has laid down a Code ofConduct for its members and Senior Management Personnel of the Company. The same has alsobeen posted on the weblink http://rajtube.com/data/cc.pdf It is further confirmed that allthe Directors and Senior Management Personnel of the Company have affirmed compliance withthe Code of Conduct of the Company for the financial year ended March 31 2017 asenvisaged in SEBI (Listing Obligations and Discloure Requirements) Regulations 2015. Forthe purpose of this declaration senior management personnel means the means the membersof the Management one level below the Managing Director of the Company as 31 March 2017.

Registered office: 404 Shekhawati Complex Station Road JAIPUR

(HARISH CHAND JAIN) Dated: 30th May 2017 CHAIRMAN & MANAGING DIRECTORDIN NO.:01504391