To The Members
The Directors have pleasure in presenting 31st Annual Report on the businessand operations of the Company alongwith the audited Balance Sheet and Statement of Profit& Loss for the year ended on 31st March 2017.
|Particulars || || |
| ||Year Ended 31st March 2017 ||Year Ended 31st March 2016 |
|Gross Sales ||17635.39 ||15407.52 |
|Less:Excise Duty ||1546.18 ||1476.78 |
|Net Sales ||16089.21 ||13930.74 |
|Other Income ||146.50 ||206.02 |
|Total Income ||16235.71 ||14136.76 |
|Profit before Interest ||1659.18 ||1165.80 |
|Depreciation & Tax || || |
|Less :Interest ||286.00 ||290.74 |
|Depreciation ||367.38 ||354.30 |
|Profit Before Tax ||1005.80 ||520.76 |
|Less :PreviousYear adjustments ||(9.45) ||NIL |
|Provision for Wealth Tax ||NIL ||NIL |
|Provision for current ||320.00 ||200.00 |
|year income-tax || || |
|Provision for Deferred Tax ||(3.91) ||(15.79) |
|Net Profit after tax ||699.16 ||336.55 |
|Net profit after tax and ||699.16 ||336.55 |
|adjustments || || |
|Dividends || || |
|Less :Interim Dividend ||NIL ||NIL |
|Final Dividend (Proposed) ||50.76 ||NIL |
|Dividend Distribution Tax on || || |
|Proposed Dividend ||10.62 ||NIL |
|Transferred to General Reserve ||NIL ||34.00 |
|Balance carried to Balance Sheet ||2974.53 ||2336.75 |
|EPS (Basic) ||27.55 ||13.26 |
|EPS (Diluted) ||27.55 ||13.26 |
REVIEW OF OPERATIONS:
The net revenue from operations of the Company stands at Rs. 16089.21 Lacs in thisfinancial year ended on 31st March 2017 at a growth of around 15.49 % asagainst
Rs. 13930.74 Lacs for the previous financial year. The net profit after tax for thisyear is Rs. 699.16 Lacs as compared to Rs. 336.55 Lacs for the previous financial yearresulting an increase of 107.74%. The increase in profits is a result of expansion doneand good order book position. This is especially because of the exports sector which hasseen an increase of almost 75% with good contribution to the profitability.
Reserves & Surplus as on 31st March 2017 stand at
Rs. 3975.54 Lacs as against the paid-up capital of Rs. 253.83 Lacs.
Your Directors recommend a dividend of Rs. 2/- per share (20%) for the financial year2016-17. This dividend payout if approved in the forthcoming Annual General Meeting willresult in outflow of Rs. 61.39 Lacs inclusive of Rs. 10.62 Lacs on Dividend Tax.
TRANSFER TO GENERAL RESERVE:
Your Directors do not propose transfer to the general reserves out and it is proposedto be retained in the profit and loss account.
The paid up equity capital of the Company as on March 31 2017 was Rs. 253.83 Lacsduring the year under review. The Board has recommended for increase in Authorised ShareCapital of the Company upto Rs. 5.10 Crores.
The Board has decided and recommended for capitalization of free reserves by way ofissuance of bonus shares in the ratio of 1:1 i.e. one fully paid up equity share for everyone equity share held.
TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND:
In terms of Section 125 of the Companies Act 2013 no unclaimed dividend in relationto any financial year is due for remittance to the Investor Education and Protection Fundestablished by the Central Government.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:
The Company has a proper Internal Control System commensurate with the size scale andcomplexity of its operations. The Company has appointed M/s Harshit Bansal &Associates Chartered Accountants as Internal Auditors of the Company for financial year2016-17. To maintain the objectivity and independence the Internal Audit team reports tothe Chairman of the Audit Committee of the Board and to the President/COO.
The Internal Audit team monitors and evaluates the efficacy and adequacy of internalcontrol system in the company accounting procedures and policies. Based on the internalaudit report the Company undertake corrective action in their respective areas andthereby strengthen the control.
MARKETING AND EXPORT:
The export sales have registered a growth to Rs. 3840.83 Lacs in financial year2016-17 as against Rs. 2200.92 Lacs in previous year. Thus showing an increase of 75%with good contribution in the profitability.
Your Company has been assigned a rating of BBB+ for Long Term Bank Facilities (TermLoans) of Rs. 18.00 Crores and rating of BBB+/A2 for Long / Short Term Bank Facilities(Fund Based Limits) availed from Indusind Bank Limited DBS Bank Limited and HDFC BankLimited. The rating is assigned by CARE (Credit Analysis & Research Limited).
The Company is not having any subsidiary company.
The Board of Directors consists of executive and non-executive directors includingindependent directors who have wide and varied experience in different disciplines ofcorporate functioning.
Mr. Vijay Kumar Sharma Executive Director is liable to retire by rotation and beingeligible offers himself for reappointment. Your Directors recommend for his reappointment.
Pursuant to section 203 of the Companies Act 2013 the Key Managerial Personnel of theCompany during the year are Mr. Tarun Talwar Managing Director (upto 07thJune 2016) and CEO (Upto 01st February 2017) Mr. Sanjay Sharma ExecutiveDirector Mr. Vijay Kumar Sharma Executive Director Mr. Kanwar Pal Pawar ChiefFinancial Officer and Mr. Ankush Jindal Company Secretary.
DIRECTORS' RESPONSIBILITY STATEMENT:
In accordance with the provisions of section 134(5) the Board confirm and submit theDirectors Responsibility Statement:-
(i) that in the preparation of the annual accounts the applicable accounting standardshave been followed along with the proper explanation relating to material departures;
(ii) the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that were 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 of the company for that period;
(iii) the directors had taken proper and sufficient care for the maintenance ofadequate accounting records for safeguarding the assets of the company and for preventingand detecting fraud and other irregularities;
(iv) the Directors had prepared the annual accounts on a going concern basis;
(v) the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DECLARATION BY INDEPENDENT DIRECTORS:
The Independent directors have submitted their disclosure to the Board that theyfulfill all the requirements as to qualify for their appointment as an IndependentDirector under the provisions of section 149(6) of the Companies Act 2013 and underregulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
NUMBER OF MEETINGS OF THE BOARD:
The Board met 8 (Eight) times during the financial year under review the details ofwhich are given in the Corporate Governance Report that forms part of this Annual Report.The intervening gap between any two meetings was within the period prescribed under theCompanies Act 2013.
Pursuant to the provisions of Companies Act 2013 and Regulation 25(3) of SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 Independent Directors attheir meeting without the participation of the Non-Independent Directors and Managementconsidered / evaluated the Boards' performance including the chairman.
The Board subsequently evaluated its own performance the working of its committees(Audit Nomination and Remuneration and Stakeholders Relationship Committee) andIndependent Directors (without participation of the relevant Director).
The criteria for performance evaluation have been detailed in the Corporate GovernanceReport attached to this report.
The Company has amended its Registered Office address as Plot No. 74-75-76 Sector 6Faridabad Haryana 121 006 w.e.f. 09th February 2017.
POLICY OF DIRECTORS' APPOINTMENT AND REMUNERATION:
The Company's policy on director's appointment and remuneration and other matterspursuant to section 178(3) of the Companies Act 2013 has been disclosed in CorporateGovernance Report which forms part of this report.
CODE OF CONDUCT:
The Board of Directors has approved a code of conduct applicable to the members of theBoard principal executive officers principal financial officers principal accountingofficers or controllers and all senior management of the Company. The code has been titledas "Code of Ethics for Designated Persons". The same has been posted on thewebsite of the Company www.talbrosaxles.com.
The code lays down as standard procedure for efficient working of designated employeesand to build a transparency between the management and stakeholders of the Companycompliance with governmental laws rules and regulations.
The Designated employees have confirmed the compliance with the code of conduct.
The Audit Committee consists of 3 (Three) Directors with Independent Director aschairman. During the year 4 (Four) meetings of the committee were held. The responsibilityand duties of Audit Committee have been detailed in the Corporate Governance Report.
NOMINATION AND REMUNERATION COMMITTEE:
The Nomination and Remuneration committee consists of 3 (three) Non ExecutiveDirectors. During the year 4 (Four) meetings have been held. The key areas of Committeehave been detailed in Corporate Governance Report.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
The Company has not given any loan or guarantees covered under the provisions ofsection 186 of Companies Act 2013. The detail of investments made by the Company is givenin the notes to the financial statements.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There are no materiallysignificant related party transactions made by the company with promoters Directors KeyManagerial Personnel or other designated persons which may have a potential conflict withthe interest of the Company at large. The details of related party transactions have beendisclosed in notes to financial statement and information pursuant to section 134(3)(h) ofCompanies Act 2013 read with rule 8(2) of Companies (Accounts) Rules 2014 are given inform AOC-2 and the same forms part of this report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The policy on Vigil Mechanism/Whistle Blower is hosted on the website of the Company.
The policy inter alia provided direct access to the Vice Chairman and CFO of theCompany. The Vice Chairman and CFO can approach and discuss the matter with Chairman orAudit Committee as they deem fit.
Your Company affirms that no complaints have been received during the year underreview.
Comments of the Auditors in their report and the notes forming part of the BalanceSheet are self explanatory and need no comments.
The Auditors M/s Rakesh Raj & Associates Chartered Accountants Faridabad retiresat ensuing Annual General Meeting. The Board of Directors in their meeting held on
17 August 2017 has proposed the appointment of M/s DSRV and Co. LLP CharteredAccountants (FRN: 006993N) as Statutory Auditors of the Company for a period of 5 (Five)years from the conclusion of this Annual General Meeting till the conclusion of 36thAnnual General Meeting subject to ratification at every Annual General Meeting.
SECRETARIAL AUDIT REPORT AND THE APPOINTMENT OF THE SECRETARIAL AUDITOR:
The Company has appointed M/s Sonal Agarwal & Associates Company Secretaries tohold the office of Secretarial Auditors and to conduct the Secretarial Audit pursuant tosection 204 of Companies Act 2013 and the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014. The Secretarial Audit Report for the financial yearended on 31st March 2017 is being attached with the Director's Report asAnnexure B which is self explanatory and needs no comments.
COST AUDITOR'S AND THEIR REPORT:
Cost Audit is not applicable on the product being manufactured by the Company.
INSURANCE AND RISK MANAGEMENT:
The assets of the Company are adequately insured against the loss of fire burglary andother risks which are considered necessary by the management and suggested by the bankersof the Company.
PREVENTION OF INSIDER TRADING:
The Company has formulated and adopted code for prevention of insider trading. The samehas also been published on the website of the Company.
The code inter alia contains the formalities / pre clearance required for dealing incompany's shares and prohibits the sale or purchase by the Directors and designatedemployees while in possession of the unpublished price sensitive information and duringthe closure of trading window. The Board is responsible for implementation of the code.
All the directors and designated employees have confirmed compliance with the code.
The Company has not accepted any deposits from public during the year.
Your Company is committed to good Corporate Governance Practices and following to theguidelines prescribed by the SEBI and Stock Exchanges from time to time. The Company hasimplemented all of its major stipulations as applicable to the Company. The StatutoryAuditor's Certificate dated 17 August 2017 in accordance with SEBI (Listing Regulations)2015 and report on Corporate Governance is annexed to and forming part of the Director'sReport.
Mr. Tarun Talwar Chief Operating Officer and Mr. Kanwar Pal Pawar Chief FinancialOfficer have given a certificate to the Board as contemplated in Regulation 17(8) andSchedule V of SEBI (Listing Regulations) 2015.
CORPORATE SOCIAL RESPONSIBILITY:
The Company is committed to discharging its social responsibility as a good corporatecitizen. As part of its social responsibility the Company has contributed to various NGOsfor promoting good education for promotion of games by constructing play ground at InterCollege Jatpura contribution for softwares and hardwares required for providing goodknowledge and education to the childrens.
Further the Company has also contributed to certain NGOs namely Savera Associationengaged in promotion of health in rural areas where people lack the right guidance forregular health check-ups & proper treatment and Lily Foundation engaged in preventionof human trafficking in India.
The Company has contributed a major portion of its CSR expenditure in promotion andmaintenance of flora and fauna in the vicinity of its registered office.
The Board provided a brief outline of the Company's CSR Policy including the statementof intent reflecting the ethos of the Company broad areas of CSR interest and an overviewof activities proposed to be undertaken. The CSR policy has been hosted on the website ofthe Company.
The present Composition of the CSR committee is:
1. Mr. Sanjay Sharma Executive Director
2. Mr. Vijay Kumar Sharma Executive Director
3. Mr. Sunil Kumar Independent Director
The average net profit of the company for last three (3) financial years is Rs. 5.92Crores (approx). The threshold limit (2%) and total proposed spending on CSR for thefinancial year 2016-17 is Rs. 11.86 Lacs (approx).
The total amount spent by the Company in year 2016-17 is Rs. 11.04 Lakhs (Approx.)leaving an untilized amount of around 0.82 Lakhs. The said unutilized amount will becontributed to certain NGOs which will undertake their proposed projects in early nextfiscal.
The details of CSR activities / projects undertaken during the financial year underreview are as follows:
| ||CSR Project/activity identified ||Sector in which the project is covered ||Projects/ Programs Local area/others ||Amount outlay (budget) project or programs wise (Rs. In Lakhs) ||Amount spent on the project/ Program (Rs. In Lakhs) ||Cumulative expenditure upto the date of reporting period (Rs. In Lakhs) ||Amount Spent: Director or through implementing agency (Rs. In Lakhs) |
|1 ||Promoting Education and Games ||Education ||Bulandshahr (UP) ||3.00 ||3.00 ||3.00 ||3.00 |
|2 ||Promoting gender equality and empowering women ||Empowering Women ||New Delhi ||1.50 ||1.00 ||1.00 ||1.00 |
|3 ||Promoting Education and Health Care ||Education & Healthcare ||New Delhi ||2.00 ||2.00 ||2.00 ||2.00 |
|4 ||Promoting Education ||Education ||Faridabad ||0.74 ||0.48 ||0.48 ||0.48 |
|5 ||Sanitation Facility ||Sanitation ||Faridabad ||0.72 ||0.72 ||0.72 ||0.72 |
|6 ||Orphanage Home ||Orphanage Home ||New Delhi ||0.10 ||0.10 ||0.10 ||0.10 |
|7 ||Protection of Flora & Fauna ||Flora & Fauna ||Faridabad ||3.80 ||3.74 ||3.74 ||3.74 |
| || || || ||11.86 ||11.04 ||11.04 ||11.04 |
* Details of Implementing Agency: RBTH Singh Memorial Charitable Hospital SocietySavera Association Lily Foundation and Chadrawati Chaudhary Smarak Trust
MANAGEMENT DISCUSSION AND ANALYSIS:
A Management discussion and Analysis as required under Schedule V of SEBI (ListingObligations & Disclosure Requirements) Regulations 2015 is annexed and forming partof the Directors' Report.
CONSERVATION OF ENERGY REASEARCH AND DEVELOPMENT TECHNOLOGY ABSORPTION AND FOREIGNEXCHANGE EARNING AND OUTGO:
The particulars prescribed under section 134(3)(m) of Companies Act 2013 read withrule 8 of Companies (Accounts) Rules 2014 are enclosed as Annexure A to theBoard's Report.
INFORMATION PURSUANT TO SECTION 197(12) READ WITH RULE 5 OF THE COMPANIES (APPOINTMENTAND REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014:
In terms of the provisions of Section 197(12) of the Companies Act 2013 read with rule5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 none of the employee of the company has received the remuneration in excessto the limits set out in the rules.
Further pursuant to the provisions of Section 197(12) of Companies Act 2013 and rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the disclosures and details as required to be annexed to the Board's Report are providedhereunder:
(a) Ratio of remuneration of each director to the median remuneration of employees ofthe Company
| || || ||Amount (In Rs.) |
|Name of the Director ||Designation ||Remuneration paid ||Ratio to median remuneration |
|Mr. Tarun Talwar ||Managing Director ||5.29 ||3.65 |
| ||(Upto 07.06.2016) || || |
|Mr. Sanjay Sharma ||Executive Director ||9.86 ||6.81 |
|Mr. Vijay Kumar Sharma ||Executive Director ||9.78 ||6.75 |
|Mr. Kuldeep Singh Bhalla ||Independent Director ||0.05 ||Only Sitting fees paid |
|Mr. Sunil Kumar ||Independent Director ||0.05 ||Only sitting fees paid |
|Ms. Priyanka Khattar ||Independent Director ||0.05 ||Only sitting fees paid |
(b) Percentage increase in remuneration of Directors and KMPs
|Name of the Director/KMP ||Designation ||Remuneration for the year ended 2016-17 ||Remuneration for the year ended 2015-16 ||% change during the year |
|Mr. Tarun Talwar* ||Managing Director ||26.07 ||52.56 ||(26.49) |
| ||(Upto 07.06.2016) and || || || |
| ||CEO upto 01.02.2017) || || || |
|Mr. Sanjay Sharma ||Executive Director ||9.86 ||9.26 ||6.48 |
|Mr. Vijay Kumar Sharma ||Executive Director ||9.78 ||9.18 ||6.54 |
|Mr. Sunil Kumar ||Independent Director ||0.05 ||0.05 ||0.00 |
|Ms. Priyanka Khattar ||Independent Director ||0.05 ||0.05 ||0.00 |
|Mr. Kuldeep Singh Bhalla ||Independent Director ||0.05 ||0.05 ||0.00 |
|Mr. Ankush Jindal ||Company Secretary ||5.94 ||5.35 ||11.03 |
|Mr. Kanwar Pal Pawar ||CFO ||3.63 ||3.28 ||10.67 |
* Mr. Tarun Talwar has resigned from the post of Managing Director w.e.f. 07thJune 2016.
(c) The median remuneration of the employees has increased by 4.05 % in 2016-17 ascompared to 2015-16.
(d) Number of permanent employees on the rolls of the Company.
|Financial Year ||No. of Employees |
|2015-16 ||217 |
|2016-17 ||233 |
(e) We affirm that the remuneration paid to Directors Key Managerial Personnel's andemployees is as per the remuneration policy of the Company.
CORPORATE GOVERNANCE CERTIFICATE:
The Compliance Certificate from the auditors regarding compliance of conditions ofcorporate governance as stipulated in SEBI (Listing Regulations) 2015 has been annexed tothis report.
EXTRACTS OF THE ANNUAL RETURN:
The Extracts of the Annual Return for the year 2016-17 being attached with theDirectors Report as Annexure C
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
In order to prevent sexual harassment of women at work place a new act The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 hasbeen notified on 9th December 2013. Under the said Act every company is required to setup an Internal Complaints Committee to look into complaints relating to sexual harassmentat work place of any women employee.
Company has adopted a policy for prevention of Sexual Harassment of Women at workplaceand has set up Committee for implementation of said policy. During the year Company hasnot received any complaint of harassment.
Your Directors wish to place on record their appreciation for the overwhelmingco-operating and assistance received from the investors customers business associatesbankers vendors as well as regulatory and governmental authorities. Your Directors alsothank the employees at all levels who through their dedication co-operation supportand smart work have enabled the Company to achieve rapid growth.
| ||For and on behalf of the Board |
| ||Sd/- |
|Place: Faridabad ||Sanjay Sharma |
|Date : 17 August 2017 ||Chairman |