VOLTAMP TRANSFORMERS LIMITED
Makarpura Vadodara 390014 Gujarat.
Your Directors have pleasure in presenting the 50th Annual Report and FinancialStatements for the Financial Year ended 31st March 2017.
(Rs. in Lacs)
|PARTICULARS ||2016-2017 ||2015-2016 |
|Sales & Services Income ||60937.70 ||56330.32 |
|Profit before Financial Charges and Depreciation ||9727.91 ||6570.77 |
|Financial Charges (Bank Charges) ||47.17 ||43.91 |
|Depreciation ||581.72 ||597.77 |
|Profit before Taxation ||9099.02 ||5929.09 |
|Provisions for Taxation : || || |
|Current Tax ||2300.00 ||1550.00 |
|Deferred Tax ||2.14 ||(18.92) |
|Net Profit for the year ||6796.88 ||4398.01 |
|Add: Previous years' surplus ||1441.92 ||1066.01 |
|Profits available for appropriation: ||8238.80 ||5464.02 |
|Appropriation therefrom: || || |
|A. Proposed Dividend ||1517.57 ||1264.64 |
|B. Dividend Tax on above || ||257.46 |
|C. General Reserve || ||2500.00 |
|D. Surplus || ||1441.92 |
| ||8238.80 ||5464.02 |
The Directors recommend payment of dividend @ 150% i.e. Rs. 15 per equity shareof Rs. 10 each on 10117120 equity shares for the year ended March 31 2017.
During the year under review the Sales and Other Income in monetary terms increased byabout 10% to Rs. 651.45 crores as compared to Rs. 591.58 crores in the previous year. TheCompany has recorded its best ever performance in MVA term achieving sales volume of10189 MVA as compared to 9202 MVA in the previous year a growth of 10% compare toprevious year. The Profit Before Tax (PBT) increased to Rs. 90.99 crores ascompared to Rs. 59.29 crores in the previous year and Profit After Tax (PAT) increased toRs. 67.97 crores as compared to Rs. 43.98 crores in the previous year.
The Company has been able to maintain its growth momentum both in terms of volume andmargins for the second year in a row. Volatility in the Domestic as well as Internationalmarket of principal raw materials had been a constant challenge for the Management toexecute fixed price orders at budgeted cost and maintain the margins. The Company couldavail some benefits out of falling material prices and better discipline in selectingorders along with scaling up volume help greatly to improve margin. The Company'sdependence on TRANSCOs (erstwhile SEBs) business during the year come down drastically.
The financial year 2017-2018 started with an order backlog of Rs. 293.48 crores(4622.38 MVA) with sign of slow revival in Corporate CAPEX in select industries.
During the year the Company's dedicated efforts towards timely collection ofreceivables has resulted in better liquidity position. The Company's efforts continued tohave timely realization of receivables which remain a challenging task.
For detailed analysis of the performance please refer to the Management Discussion andAnalysis section of the Annual Report given in Annexure-IV.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND :
The unclaimed dividend amount aggregating to Rs. 212700 for the financial year endedon 31st March 2009 was transferred to the Investor Education and Protection Fundestablished by the Central Government during the financial year ended March 31 2017pursuant to Section 124 of the Companies Act 2013.
Further according to the Rules the shares in respect of which dividend has not beenpaid or claimed by the shareholders for seven consecutive years or more shall also betransferred to the demat account created by the IEPF authority. Accordingly the companyhas transferred the unclaimed and unpaid dividends. Further the corresponding shares willbe transfered as per the requirements of the IEPF rules.
DISCLOSURE OF PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION ANDFOREIGN EXCHANGE EARNINGS AND OUTGO:
The disclosure of particulars relating to conservation of energy and technologyabsorption and foreign exchange earnings and outgo as required by Section 134 of theCompanies Act 2013 read with the Companies (Accounts) Rules 2014 is given in Annexure -I.
The industrial relations during the year under review have remained cordial andsatisfactory barring contract labour of Savli factory staying away from works for about4-6 weeks. The Board thanks all the Employees for their valuable contribution to theworking of the Company.
In accordance with the provisions of Section 197(12) of the Companies Act 2013 andRule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 the names and other particulars of employees and the Disclosurepertaining to remuneration and other details are set out in the Annexure - II to theDirectors' Report. However as per the provisions of Section 136(1) of the Companies Act2013 the Directors' Report is being sent to the shareholders without this Annexure.Shareholders interested in obtaining a copy of the Annexure may write to the CompanySecretary at the Company's Registered Office.
In compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance is given in Annexure III along with certificate from M/s.Chandulal M. Shah & Co. Chartered Accountants confirming compliance with therequirement of Corporate Governance.
MANAGEMENT DISCUSSION AND ANALYSIS:
Management Discussion and Analysis Report is given in Annexure - IV.
DIRECTORS' RESPONSIBILITY STATEMENT UNDER SECTION 134 (5) OF THE COMPANIES ACT 2013:
The Directors confirm that:
1) In the preparation of the annual accounts the applicable accounting standards havebeen followed by the Company;
2) Such accounting policies have been selected and consistently applied and judgmentsand estimates made that are reasonable and prudent so as to give a true and fair view ofthe state of affairs of the Company as at 31st March 2017 and of the profit of theCompany for the year ended on that date;
3) Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the applicable provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
4) Annual accounts have been prepared on a going-concern basis;
5) Internal financial controls to be followed by the Company have been laid down andthat such internal financial controls are adequate and were operating effectively.
6) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
As per the applicable provisions of the Companies Act 2013 Shri Vallabh N Madhaniretire by rotation and being eligible offers himself for reappointment. Further sincethe tenure of appointment of Shri Kunjalbhai L. Patel as a Vice Chairman and ManagingDirector of the Company has expired on 14.03.2017 he has been re-appointed as a ViceChairman and Managing Director liable to retire by rotation for a further period of five(5) years w.e.f. 15.03.2017 by the Board of Directors at their meeting held on 13thFebruary 2017 subject to approval of the shareholders.
During the year there is no change in Key Managerial Personnel of the Company.
M/s Chandulal M. Shah & Co. are the retiring Auditors and will hold office up tothe forthcoming Annual General Meeting of the Company. Under Section 139 142 and otherapplicable provisions if any of the Companies Act 2013 read with the Companies (Auditand Auditors) Rules 2014 (including any statutory modification(s) or re-enactment thereoffor the time being in force) it is mandatory for the Company to rotate the statutoryauditors on completion of the maximum term permitted under the said Section. Maximumpermitted tenure of M/s Chandulal M. Shah & Co. will end on the date of ensuing AnnualGeneral Meeting of the Company. Therefore to comply with the said provisions it isnecessary to appoint other firm as a statutory Auditors in place of Chandulal M. Shah& Co.retiring Auditors. The Company has received a letter from CNK & AssociatesLLP Chartered Accountants (Firm Registration No. 101961W) C-201/202 Shree SiddhiVinayak Complex Opp. Railway station Faramji Road Alkapuri Vadodara 390005 showingtheir willingness to be appointed as statutory Auditors of the Company and they alsoconfirmed that their appointment will be within the limits specified under Section 139 ofthe Companies Act 2013. The Board of Directors of the Company at their meeting held on15th May 2017 on the recommendations of Audit Committee and subject to approval ofshareholders at the ensuing Annual General Meeting recommend the appointment of CNK &Associates LLP Chartered Accountants as statutory auditors of the Company. CNK &Associates LLP will hold office for a period of 5 (five) consecutive years from theconclusion of the 50th Annual General Meeting of the Company till the conclusion of the55th Annual General Meeting to be held in the year 2022 subject to the approval ofshareholders of the Company. The first year of audit will be of the financial statementsfor the year ending March 31 2018 which will include audit of the quarterly financialstatements for the year.
Pursuant to provisions of section 148 of the Companies Act 2013 and the Companies(Audit & Auditors) Rules 2014 The Board on the recommendation of the AuditCommittee has approved the appointment of M/s. Y. S. Thakar & Co. Cost Accountantsas the Cost Auditors and remuneration payable to them to conduct the audit of the costrecords of the Company for the financial year ending March 31 2018. The Company hasreceived a letter from M/s. Y. S. Thakar & Co. Cost Accountant Vadodara showingtheir willingness to be appointed as a cost Auditors stating that they are notdisqualified under section 148(5) read with section 141(3) of the Companies Act 2013.
SECRETARIAL AUDIT REPORT
The Board of Directors of the Company has appointed M/s. J. J. Gandhi & CompanyPracticing Company Secretaries Vadodara to conduct the Secretarial Audit pursuant tosection 204 of the Companies Act 2013 and the Companies (Appointment & Remunerationof Managerial Personnel) Rules 2014 and their report viz. Secretarial Audit Report inForm MR-3 is appended to this Report as Annexure V.
NUMBER OF MEETINGS OF THE BOARD
The Company has complied with the provisions for holding Board Meetings and the gapbetween any two meetings did not exceed 120 days. During the financial year under reviewfour Board Meetings were held viz. on 30th May 2016 12th August 2016 09th November2016 and 13th February 2017.
The Independent Directors hold office for a fixed term and are not liable to retire byrotation.
In accordance with Section 149(7) of the Act each Independent Director has givenwritten declaration to the Company confirming that he/she meets the criteria ofindependence as mentioned under Section 149(6) of the Act and SEBI Regulations 2015.
POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS
The Policy of the Company on Directors' appointment and remuneration including criteriafor determining qualifications positive attributes independence of a Director and othermatters provided under sub-section (3) of section 178 is appended as Annexure - VI tothis Report. The Policy has been posted on the website of the Company (http://www.voltamptransformers.com/pdf/nomination_remuneration_policy.pdf)
COMMENTS ON STATUTORY AUDITORS' REPORT & SECRETARIAL AUDITORS' REPORT
Neither the statutory auditors nor the Secretarial Auditors of the Company in theirrespective reports have made any qualifications reservations or adverse remarks.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
There are no loans guarantees or investments falling under section 186 of theCompanies Act 2013. However investments not falling under purview of this made by theCompany are given in the Notes to the financial statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION188(1)
There are no contracts or arrangements entered into with related parties exceptpayment of managerial remuneration to Whole-time Directors (MDs). Further the policy onRelated Party Transactions duly approved by the Board of Directors of the Company has beenposted on the website of the Company. (http://www.voltamptransformers.com/pdf/related_party_transactions_policy.pdf)
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report.
RISK MANAGEMENT POLICY AND INTERNAL FINANCE CONTROL ADEQUACY
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks in achieving key objectives of the Company. The Company has developed andimplemented Risk Management Policy of the Company to identify evaluate business risks andopportunities. This framework seeks to create transparency minimize adverse impact on thebusiness objectives and enhance the Company's competitive advantage.
The internal control systems are commensurate with the nature size and complexity ofthe business of the Company. These are routinely tested and certified by Statutory as wellas Internal Auditors.
CORPORATE SOCIAL RESPONSIBILITY
The Corporate Social Responsibility (CSR) Committee was constituted by the Board ofDirectors pursuant to Section 135 of the Companies Act 2013 and CSR policy has also beenframed by the Board as per the said Section and the Rules made thereunder. The Policy onCSR has been posted on the website of the Company (http://www.voltamptransformers.com/pdf/corporate_social_responsibility_policy.pdf).
The details about initiatives taken by the Company on Corporate Social Responsibilityduring the year is appended at Annexure - VII of the report.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return in Form MGT-9 as on 31.03.2017 is appended to this Report asAnnexure VIII.
ANNUAL EVALUATION BY THE BOARD
The evaluation framework for assessing the performance of Board including theindividual Directors are based on certain key measures viz. Attendance of Board Meetingsand the Committee Meetings qualitative contribution in deliberations on agenda itemslong term view in the inputs regarding development and sustainability of the Company andconsideration of shareholders and other stakeholders' interests.
The evaluation involves Self-Evaluation by the Board Member and subsequently assessmentby the Board of Directors. A member of the Board does not participate in the discussion ofhis / her evaluation. The Board of Directors has expressed their satisfaction to theevaluation process.
WHISTLE BLOWER POLICY
The Whistle Blower Policy (Vigil Mechanism) was constituted by the Board of Directorspursuant to Section 177 of the Companies Act 2013 and the Rules made thereunder to reportgenuine concerns of Directors and Employees. The Policy has been posted on the website ofthe Company (http://www.voltamptransformers.com/pdf/ whistle_blower_policy.pdf).
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal)Act 2013. Internal Complaint Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees) are covered under this policy. During the year under review no complaints werereported to the Board.
APPRECIATION AND ACKNOWLEDGEMENT:
Your Directors wish to convey their thanks to all the Company's valued CustomersBankers Vendors Business Associates Government Authorities and Shareholders for theircontinued support and patronage to the Company.
The Board also expresses its appreciation towards the contribution made by all theEmployees of the Company.
| ||FOR AND ON BEHALF OF THE BOARD |
|Place : Vadodara ||KANUBHAI S. PATEL |
|Date : May 15 2017 ||CHAIRMAN & MANAGING DIRECTOR |
ANNEXURE - I TO THE DIRECTORS' REPORT
A] CONSERVATION OF ENERGY:
[a] Energy conservation measures taken :
1. Use of energy efficient LED lighting and modernization in distribution system.
2. Systematic studies of power consumption to avoid unwanted energy losses.
3. Creating awareness among all employees to conserve energy.
4. Develop vacuum pumping system in VPD plant.
[b] Additional investments and proposal if any being implemented for reduction ofconsumption of energy: Installation of Vacuum Ovening for distribution transformersmanufacturing facility.
[c] Impact of the measures at [a] and [b] above for reduction of energy consumption andconsequent impact on the cost of production of goods: The various measures taken by theCompany have resulted in reduction in consumption of energy and efforts are going on tofurther reduce the consumption of energy quality improvement time saving and theconsequent impact on the cost of production.
[d] Total energy consumption and energy consumption per unit of production as perForm-A: Not Applicable.
B] TECHNOLOGY ABSORPTION:
Research and Development (R&D):
[a] Specific areas in which R&D carried out by the Company:
1. Use of Special Bunch & CTC Conductors to minimize losses.
2. Use of special CTC Conductor bending tools.
3. Developed in house Tinning Plant for copper bus-bar.
4. Extensive use of partial discharge & impulse test facility.
5. Introduction of layer winding in Distribution Transformers.
6. Installation of HVAC system for winding area.
7. Installation of vertical winding machine.
[b] Benefits derived as a result of the above R&D :
1. Transformer is able to withstand severe short circuit conditions withoutdeformation hence reliability is ensured.
2. Price Competitiveness.
3. Improvement in quality with cost saving.
4. Know the quality of Insulation and process for better reliability.
5. Better space factor and better balancing of windings.
6. Dust is being controlled which is essential for electrical equipments.
7. Higher rating transformers winding become easier and with better quality.
[c] Further plan of action:
1. Continued emphasis on development of cost effective components and work on importsubstitution.
2. Identification and narrowing down the gaps in the areas of product processmanufacturing and information technologies.
3. Wastage reduction / control by implementation of 5-S.
4. Solar panel installation for office building power supply. Technology AbsorptionAdaptation an Innovation:
[a] Efforts in brief made towards technology absorption adaptation and innovation :Extensive training in technical and management fields with a special emphasis on TotalQuality Management.
[b] Benefits derived as a result of the above efforts:Improvement in product quality.
[c] Technology imported during the last five years: The Company has executed technicallicense agreement with PROCOM Germany for getting Aluminum Foil Winding Technology.
C] FOREIGN EXCHANGE EARNINGS AND OUTGO:
|[a] Foreign Exchange used ||: Rs. 20521058 |
|[b] Foreign Exchange earned ||: Rs. 19525673 |