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Aartech Solonics Ltd.

BSE: 542580 Sector: Engineering
NSE: N.A. ISIN Code: INE01C001018
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NSE 05:30 | 01 Jan Aartech Solonics Ltd
OPEN 18.10
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VOLUME 4000
52-Week high 56.45
52-Week low 18.10
P/E 60.33
Mkt Cap.(Rs cr) 19
Buy Price 0.00
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Sell Price 0.00
Sell Qty 0.00
OPEN 18.10
CLOSE 18.10
VOLUME 4000
52-Week high 56.45
52-Week low 18.10
P/E 60.33
Mkt Cap.(Rs cr) 19
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Aartech Solonics Ltd. (AARTECHSOLONICS) - Director Report

Company director report

To

The Shareholders Aartech Solonics Limited

Bhopal

Your Directors are pleased to present the 39th 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 2021. 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: -

Standalone Consolidated
PARTICULARS Year ended 31st March 2021 Year ended 31st March 2020 Year ended 31st March 2021 Year ended 31st March 2020
Revenue from Operations 109282561 100440048 109585424 100992804
Other Income 9437734 7816856 5835764 4882215
Total Revenue 118720295 108256904 115421188 105875019
Less: Expenses (108552957) (101024938) (110819635) (106256806)
Profit before Finance Cost 10167338 7231966 4601553 (381787)
Depreciation/ Amortisation
Expenses & Tax
Exceptional Items - - - -
Profit before Depreciation/ 10167338 7231966 4601553 (381787)
Amortisation Expenses & Tax
Less: Depreciation/ - - - -
Amortisation Expenses
Profit/ (Loss) before tax 10167338 7231966 4601553 (381787)
Current Tax 1750487 1200584 1750487 1200584
Deferred Tax 33994 119537 273482 365555
Net Profit/ (Loss) after tax 8382857 5911845 2577584 (1947926)

2. BRIEF DESCRIPTION OF THE COMPANY'S OPERATIONS DURING THE YEAR / STATE OFCOMPANY'S AFFAIR

STANDALONE

During the current period your company has shown increase in total revenue of Rs.118720295/- as against Rs. 108256904/- in the previous year. The Company has earneda net profit of Rs. 8382857/- as compared to profit of Rs. 5911845/- in the previousyear. The Company continues to pursue expansion in the domestic market to achievesustainable and profitable growth.

CONSOLIDATED

During the current period your company has shown increase in total revenue of Rs.115421188/- as against Rs. 105875019/- in the previous year. The Company has earneda net profit of Rs. 2577584/- as compared to loss of Rs. 1947926/- in the previousyear.

3. NATURE OF BUSINESS

There was no change in the nature of Business of the Company during the Financial Year.

4. DIVIDEND

Your directors are pleased to recommend a final dividend of Re. 0.50/- per equity shareof face value of Rs. 10/- each for the year ended 31st March 2021.

The Final Dividend subject to the approval of Members at the Annual General Meeting onWednesday 29th September 2021 will be paid to the Members whose names appearin the Register of Members as on the Book Closure date i.e. from Wednesday 22nd day ofSeptember 2021 to Wednesday 29th day of September 2021 (both days inclusive). In view ofthe changes made under the Income-tax Act 1961 by the Finance Act 2020 dividends paidor distributed by the Company shall be taxable in the hands of the Shareholders. YourCompany shall accordingly make the payment of Final Dividend after deduction of tax atsource.

5. SHARE CAPITAL

The paid-up equity share capital as at March 31 2021 is Rs. 70600940/- (RupeesSeven Crore Six Lakh Nine Hundred Forty only). There is no change in paid-up share capitalof the company during the year.

6. RESERVES

The Company has transferred Rs. 8382857/- to its Reserves during the year.

7. UTILIZATION OF IPO FUND

The Initial Public Offer fund has being utilized for the purpose for which it is raisedas mentioned in the prospectus.

8. DEPOSITS

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.

9. 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 2020-2021.

10.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.

11.SUBSIDIARY ASSOCIATE AND JOINT VENTURE COMPANIES

The Company has two subsidiary companies namely AIC-Aartech Solonics Private Limitedand Faradigm Ultracapacitors Private Limited.

12.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 31 2021.

13.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 2021 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 2021 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. Amit Anil Raje Chairman & Managing Director 01/04/2007 1 2 2 Nil
Ms. Arati Nath CEO & Director 12/05/2020 1 3 Nil Nil
Mr. Anil Anant Raje Non- executive Director 24/08/1982 1 2 2 Nil
Mr. Prashant Dattatray Lowlekar Non- executive Independent Director 27/02/2018 1 Nil 2 1
Mr. Kshitij Negi Non- executive Independent Director 08/02/2021 1 Nil 3 2

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 6 (Six) Board meetings were held on May 122020 June 29 2020 September 02 2020 November 13 2020 November 26 2020 and February08 2021. 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 2021 andtheir attendance at the Board meetings and Annual General Meeting ("AGM") duringthe financial year ended March 31 2021 are given below:

Type of Meeting Name of Directors
Mr. Anil Anant Raje Mr. Amit Anil Raje Ms. Arati Nath Ms. Poonam Jaideep Mulherkar Mr. Kshitij Negi Mr. Ravindra Kumar Shingwekar Mr. Prashant Dattatray Lowlekar
BM (12/05/2020) v v X v X v v
BM (29/06/2020) v v X X X v v
BM (02/09/2020) v v v X X v v
BM (13/11/2020) v v v X X v v
BM (26/11/2020) v v v X X v v
BM (08/02/2021) v v v X X v v
AGM (24/09/2020) v v 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. Kshitij Negi and Mr. Amit AnilRaje.

Mr. Prashant Dattatray Lowlekar Independent Director is the Chairman of the AuditCommittee.

Mr. Kshitij Negi on account of resignation of Mr. Ravindra Kumar Shingwekar occupiedthe position of member in the Audit Committee on February 08 2021.

During the financial year ended on March 31 2021 5 (Five) meeting of the AuditCommittee were held on May 12 2020 June 29 2020 September 02 2020 November 13 2020and February 08 2021 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. Kshitij Negiand Mr. Anil Anant Raje.

Mr. Kshitij Negi Independent Director is the Chairman of the Nomination andRemuneration Committee who on account of resignation of Mr. Ravindra Kumar Shingwekaroccupied the position of Chairman and member in the Nomination and Remuneration Committeeon February 08 2021.

During the financial year ended on March 31 2021 5 (Five) meeting of the Nominationand Remuneration Committee was held on May 12 2020 June 29 2020 September 02 2020November 13 2020 and February 08 2021which was attended by all the members of theCommittee.

e) Stakeholders Relationship Committee

The Stakeholders Relationship Committee in terms of the provisions of Section 178 ofthe Companies Act 2013 comprising of Mr. Kshitij Negi Mr. Anil Anant Raje and Mr. AmitAnil Raje.

Mr. Kshitij Negi Independent Director is the Chairman of the StakeholdersRelationship Committee who on account of resignation of Mr. Ravindra Kumar Shingwekaroccupied the position of Chairman and member in the Stakeholders Relationship Committee onFebruary 08 2021.

During the financial year ended on March 31 2021 5 (Five) meeting of the StakeholdersRelationship Committee were held on May 12 2020 June 29 2020 September 02 2020November 13 2020 and February 08 2021 which were attended by all the members of theCommittee.

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 2021 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 2021 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 utilization 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.

20.POLICIES:

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 andremuneration to Key Managerial 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 2021. 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. S. Ramanand Aiyer & Co. Chartered Accountants (Firm Registration No. 000990N)were appointed as the statutory auditor of the Company for a period of three years at theAnnual General Meeting (AGM) of the Company held on September 24 2020 to hold officefrom the conclusion of the Thirty-Eighth AGM till conclusion of the Forty-First AGM to beheld in the year 2023.

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.

25.SECRETARIAL AUDITOR

The Board has appointed M/s. APVN & Associates Company Secretaries to conductSecretarial Audit for the Financial Year 2020-21. The Secretarial Audit Report for theFinancial Year ended March 31 2021 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 2021.

29.DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND 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 always endeavorsto create and provide an environment that is free from discrimination and harassmentincluding 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 programs inthe organization 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'sendeavor 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/-
Amit Anil Raje Arati Nath
Place: Bhopal Managing Director Director
Dated: 06/09/2021 (DIN: 00282385) (DIN: 08741034)

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