Aartech Solonics Limited
Your Directors are pleased to present the 37th Annual Report on the businessperformance and operations of your Company together with the Audited Financial Statementsand the Auditor's Report for the financial year ended March 31 2019. The consolidatedperformance of the Company and its subsidiaries has been referred to wherever required.
1. FINANCIAL SUMMARY OR HIGHLIGHTS / PERFORMANCE OF THE COMPANY:
Financial results of the Company for the year under review are as follow: -
| || |
|PARTICULARS ||Year ended 31st March 2019 ||Year ended 31st March 2018 ||Year ended 31st March 2019 ||Year ended 31st March 2018 |
|Revenue from Operations ||145650996 ||113027728 ||140441550 ||98827691 |
|Other Income ||12741955 ||7822607 ||10859385 ||12163735 |
|Total Revenue ||158392951 ||120850335 ||151300935 ||110991426 |
|Less: Expenses ||(137061271) ||(107146722) ||(141751183) ||(101405698) |
|Profit before Finance Cost Depreciation/ Amortisation Expenses &Tax ||21331680 ||13703613 ||9549752 ||9585728 |
|Exceptional Items ||- ||- ||- ||- |
|Profit before Depreciation/ Amortisation Expenses &Tax ||21331680 ||13703613 ||9549752 ||9585728 |
|Less: Depreciation/ Amortisation Expenses || || || || |
|Profit/ (Loss) before tax ||21331680 ||13703613 ||9549752 ||9585728 |
|Current Tax Expenses for current year ||4272177 ||2225740 ||4272177 ||2225740 |
|Deferred Tax ||74157 ||(280616) ||141126 ||(208921) |
|Net Profit/ (Loss) after tax ||16985346 ||11758489 ||5136449 ||7568909 |
2. BRIEF DESCRIPTION OF THE COMPANY'S OPERATIONS DURING THE YEAR / STATE OF COMPANY'SAFFAIR
During the current period your company has shown increase in total revenue of Rs.158392951/- as against Rs. 120850335/- in the previous year. The Company has earneda net profit of Rs. 16985346/- as compared to profit of Rs. 11758489/- in theprevious year. The Company continues to pursue expansion in the domestic market toachieve sustainable and profitable growth.
During the current period your company has shown increase in total revenue of Rs.
15.13.00. 935/- as against Rs. 110991426/- in the previous year. The Company hasearned a net profit of Rs. 5136449/- as compared to profit of Rs. 7568909/- in theprevious year.
3. NATURE OF BUSINESS
There was no change in the nature of Business of the Company during the Financial Year.
The company has decided to sustain the growth in line with the long-term growthobjective of the Company by retaining the profits and utilizing the same for opportunitiesin hand.
5. INITIAL PUBLIC OFFERING
During the year under review your Company came up with an Initial public issue of2120000 equity shares of Rs. 10/- each at a premium of Rs. 24/- per share aggregating tothe total Rs. 72080000/-. Subsequently the shares of the Company have been listed onSME platform of BSE SME on 27th March 2019.
6. SHARE CAPITAL
During the year under review the Company has increased its paid up share capital fromRs. 4.94.00. 940/- (Rupees Four Crore Ninety Four Lakh Nine Hundred Forty only) toRs.7.06.00. 940/- (Rupees Seven Crore Six Lakh Nine Hundred Forty only) by way of InitialPublic Offer.
No amount has been transferred by the Company to Reserves during the year.
8. UTILIZATION OF IPO FUND
The Initial Public Offer fund is being utilized for the purpose for which it is raisedas mentioned in the prospectus.
Your Company has not invited/accepted any deposit within the meaning of Section 73 ofthe Companies Act 2013 and Rules made there under during the year under review.
10. CORPORATE GOVERNANCE
As per regulation 15(2) of the Listing Regulation the Compliance with the CorporateGovernance provisions shall not apply in respect of the following class of the Companies:
a) Listed entity having paid up equity share capital not exceeding Rs. 10 Crore and Networth not exceeding Rs. 25 Crore as on the last day of the previous financial year;
b) Listed entity which has listed its specified securities on the SME Exchange.
Since our Company falls in the ambit of aforesaid exemption (b); hence compliance withthe provisions of Corporate Governance shall not apply to the Company and it does not formthe part of the Annual Report for the financial year 2018-2019.
11. EXTRACT OF ANNUAL RETURN
In accordance with Section 134(3)(a) of the Companies Act 2013 an extract of AnnualReturn in the prescribed format is appended to this Report as Annexure I and alsoavailable on the website of the company at www.aartechsolonics.com.
12. SUBSIDIARY ASSOCIATE AND JOINT VENTURE COMPANIES
The Company has two subsidiary companies namely AIC-Aartech Solonics Private Limitedand Faradigm Ultracapacitors Private Limited.
13. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to financial statements for thefinancial year ended on March 2019.
14. BOARD EVALUATION INDUCTION AND TRAINING OF BOARD MEMBERS
Pursuant to the provisions of the Companies Act 2013 and under obligations of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 the Board carries outthe annual performance evaluation of its own performance of the Directors individually aswell as the evaluation of working of its various Committees. A structured questionnaire isprepared after taking into consideration the inputs received from Directors coveringvarious aspects of the Board's functioning such as adequacy of the composition of theBoard and its Committees board culture execution and performance of specific dutiesobligations and governance.
The performance evaluation of the Independent Directors was completed. The performanceevaluation of the Chairman and the Non-Independent Directors was carried out by theIndependent Directors. The Board of Directors expressed their satisfaction with theevaluation process.
15. BOARD OF DIRECTORS & COMMITTEES THEREOF
a) Composition of the Board of Directors
The Board of the Company is composed of individuals from diverse fields. The Board ofthe Company is composed of Executive Non-Executive and Independent Directors.
As on March 31 2019 the strength of the Board of Directors of the Company was at FiveDirectors comprising of Two Executive One Non-Executive and Two Non-Executive IndependentDirectors. The details of the Board of Directors as on March 31 2019 are given below:
|Name of the Director ||Designation ||Date of Appointment || |
No. of Directorships / Committee Memberships / Chairmanships
| || || ||Public Limited Companies (including this) ||Private Limited Companies (including this) ||Committee Memberships (including this) ||Committee Chairman ships (including this) |
|Mr. Anil Anant Raje ||Chairman & Managing Director ||24/08/1982 ||1 ||2 ||1 ||Nil |
|Mr. Amit Anil Raje ||Whole-time Director ||01/04/2007 ||1 ||2 ||2 ||Nil |
|Mrs. Poonam Jaideep Mulherkar ||Non executive Director ||16/04/2018 ||1 ||Nil ||1 ||Nil |
|Mr. Prashant Dattatray Lowlekar ||Non executive Independent Director ||27/02/2018 ||1 ||Nil ||2 ||1 |
|Mr. Ravindra ||Non- ||27/02/2018 ||1 ||Nil ||3 ||2 |
|Kumar Shingwekar ||executive Independent Director || || || || || |
The composition of the Board also complies with the provisions of the Companies Act2013 and Regulation 17 (1) of SEBI (LODR) Regulations 2015.
All the Independent Directors had furnished to the Company a declaration under Section149 (7) of the Companies Act 2013 stating that they meet the criteria of independence asprovided under Section 149(6) of the Companies Act 2013 and SEBI Listing Regulations.
b) Board Meetings
The Board/Committee meetings are pre-scheduled and proper notices of Board andCommittee meetings is circulated to the Directors well in advance to enable them to plantheir schedules and to ensure their meaningful participation in the meetings.
During the financial year under review 20 (Twenty) Board meetings were held on April23 2018 June 21 2018 July 14 2018 July 20 2018 August 03 2018 August 31 2018September 05 2018 September 10 2018 October 15 2018 October 17 2018 October 18
2018 October 30 2018 November 14 2018 December 03 2018 December 19 2018January 18 2018 February 07 2019 February 22 2019 March 06 2019 and March 23
2019. The gap between two Board meetings was in compliance with the provisions of theAct and the SEBI (LODR) Regulations 2015. Details of Directors as on March 31 2019 andtheir attendance at the Board meetings and Annual General Meeting ("AGM") duringthe financial year ended March 31 2019 are given below:
|Type of Meeting || |
Name of Directors
| ||Mr. Anil Anant Raje ||Mr. Amit Anil Raje ||Mrs. Poonam Jaideep Mulherkar ||Mr. Ravindra Kumar Shingwekar ||Mr. Prashant Dattatray Lowlekar |
|BM (23/04/2018) ||V ||V ||V ||V ||V |
|BM (21/06/2018) ||V ||V ||X ||V ||X |
|BM (14/07/2018) ||V ||V ||X ||V ||V |
|BM (20/07/2018) ||V ||V ||X ||V ||V |
|BM (03/08/2018) ||V ||V ||X ||X ||X |
|BM (31/08/2018) ||V ||V ||X ||V ||V |
|BM (05/09/2018) ||V ||V ||X ||X ||X |
|BM (10/09/2018) ||V ||V ||V ||V ||V |
|BM (15/10/2018) ||V ||V ||V ||V ||V |
|BM (17/10/2018) ||V ||V ||X ||X ||X |
|BM (18/10/2018) ||V ||V ||X ||X ||X |
|BM (30/10/2018) ||V ||V ||X ||X ||X |
|BM (14/11/2018) ||V ||V ||X ||X ||X |
|BM (03/12/2018) ||V ||V ||X ||X ||X |
|BM (19/12/2018) ||V ||V ||X ||X ||X |
|BM (18/01/2019) ||V ||V ||X ||V ||V |
|BM (07/02/2019) ||V ||V ||X ||X ||X |
|BM (22/02/2019) ||V ||V ||X ||V ||V |
|BM (06/03/2019) ||V ||V ||X ||V ||V |
|BM (23/03/2019) ||V ||V ||X ||V ||V |
|EGM (04/05/2018) ||V ||V ||X ||X ||X |
|AGM (29/09/2018) ||V ||X ||X ||V ||V |
c) Audit Committee
The Audit Committee in terms of the provisions of Section 177 of the Companies Act2013 comprising of Mr. Prashant Dattatray Lowlekar Mr. Ravindra Kumar Shingwekar and Mr.Amit Anil Raje.
Mr. Prashant Dattatray Lowlekar Independent Director is the Chairman of the AuditCommittee.
During the financial year ended on March 31 2019 5 (five) meeting of the AuditCommittee were held on April 23 2018 July 14 2018 July 20 2018 November 14 2018 andFebruary 22 2019 which were attended by all the members of the Committee.
d) Nomination And Remuneration Committee
The Nomination and Remuneration Committee in terms of the provisions of Section 178 ofthe Companies Act 2013 comprising of Mr. Prashant Dattatray Lowlekar Mr. Ravindra KumarShingwekar and Mrs. Poonam Jaideep Mulherkar.
Mr. Ravindra Kumar Shingwekar Independent Director is the Chairman of the Nominationand Remuneration Committee.
During the financial year ended on March 31 2019 one meeting of the Nomination andRemuneration Committee was held on April 23 2018 which was attended by all the members ofthe Committee except Mrs. Poonam Jaideep Mulherkar.
e) Stakeholders Relationship Committee
The Stakeholders Relationship Committee in terms of the provisions of Section 178 ofthe Companies Act 2013 comprising of Mr. Ravindra Kumar Shingwekar Mr. Anil Anant Rajeand Mr. Amit Anil Raje.
Mr. Ravindra Kumar Shingwekar Independent Director is the Chairman of theStakeholders Relationship Committee.
During the financial year ended on March 31 2019 4 (Four) meeting of the StakeholdersRelationship Committee were held on April 23 2018 August 03 2018 December 19 2018 andFebruary 22 2019 which were attended by all the members of the Committee.
16. DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to the provisions of Sec. 134 (5) of the Companies Act 2013 the Directorsconfirm that:
i. in preparation of the annual accounts for the year ended March 31 2019 theapplicable accounting standards have been followed along with proper explanation relatingto material departures.
ii. appropriate accounting policies have been selected and applied and such judgmentand estimates have been made that are reasonable and prudent so as to give true and fairview of the state of affairs of the company as at March 31 2019 and of the profit of thecompany for the year ended that date.
iii. proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities.
iv. the annual accounts have been prepared on a "going concern "basis.
v. proper internal financial controls are laid down and are adequate and operatingeffectively.
vi. proper systems to ensure compliance with the provisions of all applicable laws havebeen devised and such systems are adequate and operating effectively.
17. PARTICULARS OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES
All transactions entered into with Related Parties (as defined under the Companies Act2013) during the financial year were in the ordinary course of business and on an arm'slength pricing basis and do not attract the provisions of Section 188 of the CompaniesAct 2013 and were within the ambit of Reg. 23 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. There were no materially significanttransactions with related parties during the financial year which were in conflict withthe interests of the Company. Suitable disclosure as required by the Accounting Standardshas been made in the notes to the Financial Statements.
Form AOC-2 as required under the Companies Act 2013 for related party transaction isannexed as Annexure III to the Directors Report.
18. RISK MANAGEMENT
During the financial year under review the Company has identified and evaluateselements of business risk. Consequently a Business Risk Management framework is in place.The risk management framework defines the risk management approach of the Company andincludes periodic review of such risks and also documentation mitigating controls andreporting mechanism of such risks. The framework has different risk models which help inidentifying risks trend exposure and potential impact analysis at a Company level as alsoseparately for business.
19. CONSERVATION OF ENERGY TECHNICAL ABSORPTION FOREIGN EXCHANGE EARNING
A. Conservation of Energy
The 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 theRule 8(3) of the Companies (Accounts) Rules 2014 are not applicable to the Company duringthe financial year under review.
B. Technology Absorption
The Company is doing its business by ensuring optimum utilisation of its availableresources. Your company has not taken any research & development activity so far.
C. Foreign Exchange Earnings and Outgo
There are no foreign exchange earnings and out-go during the financial year.
SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 mandated theformulation of certain policies for all listed companies. In compliance with the same theCompany has formulated the policies.
POLICY ON NOMINATION AND REMUNERATION POLICY
The policy of the Company on director's appointment and remuneration includingcriteria for determining qualification positive attributes independence of a directorand other matters provided under sub - section (3) of Section 178 of the Companies Act2013 was framed on the recommendation of Nomination and Remuneration Committee andapproved by the Board.
The key objective of this policy is selection appointment of and remuneration to KeyManagerial Personnel Directors and Senior Management Personnel.
RELATED PARTY TRANSACTIONS AND POLICY
The Company has developed a related party transactions framework through standardoperating procedures for the purpose of identification and monitoring of transactions withthe related parties.
None of the Directors has any pecuniary relationship or transactions vis-a-vis theCompany.
CODE OF CONDUCT
In Compliance with Regulation 26(3) of the SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 and the Companies Act 2013 The Company has laid down theCode of Conduct for all Board members and senior management of the Company.
All the Board members and senior management of the Company have affirmed compliancewith their Code of Conduct for the financial year ended March 31 2019. The ManagingDirector has also confirmed and certified the same. The certification is annexed at theend of this report.
VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Company has implemented a vigil mechanism policy (Whistle blower policy) wherebythe employees can raise their concerns on any violation of legal or regulatoryrequirements suspicious fraud misfeasance misrepresentation of any financial statementsand reports. The policy safeguards the whistle blower and also provides a direct access tothe Chairman of Audit Committee. During this year no complaints were received under thismechanism nor has any personnel been denied access to the Audit Committee.
21. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act 2013 are not applicable to theCompany.
22.SIGNIFICANT AND MATERIAL OREDERS PASSED BY REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/Courts that wouldimpact the going concern status of the Company and its future operations.
23.ADEQUACY OF INTERNAL CONTROL SYSTEM
The Company has adequate internal control systems for the business processes in respectof all operations financial reporting compliance with laws and regulations etc. Themanagement information system forms an effective and sound tool for monitoring andcontrolling all operating parameters. Regular internal audits ensure that responsibilitiesare executed effectively. The Audit Committee reviews the adequacy of internal controls onregular basis.
24. STATUTORY AUDITOR
M/S. SPARK & Associates Chartered Accountants (Firm Registration No. 005313C) wereappointed as the statutory auditor of the Company for a period of two years at the AnnualGeneral Meeting (AGM) of the Company held on September 29 2018 to hold office from theconclusion of the Thirty-Sixth AGM till conclusion of the Thirty-Eighth AGM to be held inthe year 2020.
The Report given by the Auditor on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditor in their Report.
2 5. SECRETARIAL AUDITOR
The Board has appointed M/s. APVN & Associates Company Secretaries to conductSecretarial Audit for the Financial Year 2018-19. The Secretarial Audit Report for theFinancial Year ended March 31 2019 is attached to this Report in Annexure IV.
26. COST AUDIT
Provision of Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Rules 2014 are not applicable to the Company during the financial yearunder review.
27. PARTICULARS OF EMPLOYEES
The information required under section 197 of the Companies Act 2013 read with Rule5(1) (2) & (3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company are not applicable to theCompany during the financial year.
28. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report under requirements of SEBI (ListingObligation and Disclosure Requirements) Regulations 2015 forms part of this AnnualReport for the year ended 31st March 2019.
29. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITIONAND REDRESSAL)ACT 2013
The Company has always believed in providing a safe and harassment free workplace forevery individual through various interventions and practices. The Company alwaysendeavours to create and provide an environment that is free from discrimination andharassment including sexual harassment.
No complaints were received by the company during the year for sexual harassment.
In order to build awareness in this area the Company has been conducting programmes inthe organisation on a continuous basis.
30. CAUTIONARY STATEMENT
Statements in the Annual Report particularly those which relate to ManagementDiscussion and Analysis describing the Company's objectives projections estimates andexpectations may constitute 'forward looking statements' within the meaning of applicablelaws and regulations. Although the expectations are based on reasonable assumptions theactual results might differ.
31. APPRECIATIONS AND ACKNOWLEDGMENTS
The Directors wish to thank and deeply acknowledge the co-operation assistance andsupport extended by the Regulatory Authorities Company's Bankers Customers Shareholdersand other business constituents during the year under review. It will be your Company'sendeavour to build and nurture strong links with the trade based on mutuality of benefitsrespect for and cooperation with each other consistent with consumer interests.
The Directors also wish to place on record their appreciation for all roundco-operation and contribution made by employees.
|For and on behalf of the Board |
|Aartech Solonics Limited |
| ||Sd/- ||Sd/- |
| ||Anil Anant Raje ||Amit Anil Raje |
|Place: Bhopal ||Managing Director ||Whole-time Director |
|Dated: 07/09/2019 ||(DIN: 01658167) ||(DIN: 00282385) |