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Ador Fontech Ltd.

BSE: 530431 Sector: Engineering
NSE: N.A. ISIN Code: INE853A01022
BSE 00:00 | 18 Aug 74.85 0.45






NSE 05:30 | 01 Jan Ador Fontech Ltd
OPEN 75.40
VOLUME 27083
52-Week high 83.50
52-Week low 58.65
P/E 11.39
Mkt Cap.(Rs cr) 262
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 75.40
CLOSE 74.40
VOLUME 27083
52-Week high 83.50
52-Week low 58.65
P/E 11.39
Mkt Cap.(Rs cr) 262
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ador Fontech Ltd. (ADORFONTECH) - Director Report

Company director report

To the Members

Greetings and we trust that this Report finds you and your family inthe best of health and well-being.

We are delighted to present the 47th Annual Report on the businessoperations of the Company and the financial statements for the year ended March 312022.


Rupees In Lakhs

Particulars Standalone Consolidated
2021-22 2020-21 2021-22 2020-21
Revenue 21040 14906 21405 15197
Earnings before interest tax and depreciation 3776 2256 3320 1967
Finance/Interest cost - - (13) (25)
Depreciation (271) (247) (341) (297)
Profit before tax 3505 2009 2966 1645
Tax (961) (738) (827) (641)
Profit after tax 2544 1271 2139 1004
Opening balance of retained earnings 3829 2858 2549 1845
Net profit for the year 2544 1271 2139 1004
Transfer to general reserve (400) (300) (400) (300)
Dividend including distribution tax (770) - (770) -
Closing balance of retained earnings 5203 3829 3518 2549


The Board of Directors have recommended dividend of Rs. 4 (Rupees fouronly) being 200% on the face value of Rs. 2 (Rupees two) per equity share whichinter-alia/includes special dividend of Rs. 1 (Rupee one only) per equity share being 50%percent to commemorate achievement of rupees two hundred crores in revenue. The entailedoutflow will be Rs. 14 crores (Rupees fourteen crores).

The payment will be subject to the approval of Members at the ensuingAnnual General Meeting. Members who hold shares on the record date ie. July 212022 willbe eligible for dividend. The payout will be made after deducting applicable income tax.

Further the Board has recommended for transfer of rupees four croresof profit to the General Reserve as against rupees three crores transferred during theprevious year.



It is a sense of great pride that the Company has surpassed yet anothermilestone of Rs. 200 crores in revenue in the history of the Company besides registeringsignificant growth in profits. The accelerated revenue growth was a phenomenal 41% year onyear. During the entire year key focus were on: (i) Optimal blend of product mix (ii)Expansion of customer base with application development and transplant (iii) Deeper focuson management of business partners (iv) Higher price realisation to offset inflation etc.

Further it may be pertinent to note that when there was significantshortage of oxygen supply in the country due to Covid- 19 the Company supplementedindustrial requirement with plasma cutting systems replacing oxy-fuel and thereby ensuringmore supply of oxygen for medical requirements which in effect may have contributed tosaving of lives at the most important critical juncture.

Going forward the areas of challenges include: (i) Managing inputmaterial prices (ii) Managing supply-chain-constraints (iii) De-risk/ Import substitutions(iv) Possibility of another Covid wave. However the Company will continue to do its bestin subserving the interests of all stakeholders including the Members GovernmentIndustry Employees and all its Associates.


The subsidiary 3D Future Technologies Private Limited's revenueincreased to Rs. 485 lakhs from Rs. 302 lakhs signifying a growth of 61%. During theyear the Company had focused on:

• Creating a dashboard for marketing and lead generationprogrammes by involving a dedicated IT (Information Technology) team.

• Employee development by re-defining KRA's (Key Result Areas) andthrust on training.

• Focus was on exploring new geographical locations and enhancinglead generation through digital platform.

• Continuously upgrading its quality of products. Incidentally itis working on ISO certifications.


As mandated by the Ministry of Corporate Affairs the financialstatements for the year ended March 312022 has been prepared in accordance with theIndian Accounting Standards (Ind-AS) notified under Section 133 of Companies Act 2013(hereinafter referred to as the Act) read with the Companies (Accounts) Rules 2014 asamended from time to time. The estimates and judgements relating to the financialstatements are made on a prudent basis so as to reflect in a true and fair manner theform and substance of transactions to reasonably present the Company's state of affairsprofits and cash flows for the year ended March 312022.


The paid-up Equity Share Capital as on March 312022 was Rs. 700 lakhsdivided in to 350 lakhs equity shares of Rs. 2/- each. There was no change in the capitalstructure of the Company during the year under review.


The Company has an appropriate mix of Executive Non-Executive andIndependent Directors with distinctiveness in functions of governance and management. Atthe end of the financial year 2021-22 the composition of Board was as under:

Name Designation
Mr. A T Malkani Non-Executive; Promoter Director and Chairman
Mr. H P Ledwani Managing Director and Chief Executive Officer
Mrs. N Malkani Nagpal Non-Executive; Promoter Director
Mr. N S Marshall Independent Director
Mr. Santosh Janakiram Independent Director
Mr. Rafique Malik Independent Director

The Board met four times during the year details of which are given inthe Corporate Governance Report which forms part of this Annual Report. The interveninggap between the meetings were within the period prescribed under the Companies Act 2013and SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015.

As required under the provisions of sub-section (3) of Section 178 ofthe Companies Act 2013 the Company has adopted optimum policies for Director'sappointment and remuneration. The policy is also hosted on the website of the Company


Director seeking re-appointment as liable to retire by rotation

In accordance with the provisions of Section 152(6) of the CompaniesAct 2013 read with relevant provisions of the Articles of Association of the Company Mr.A T Malkani Non-Executive Director is liable to retire by rotation and being eligible hasoffered his candidature for appointment/re-appointment.

Directors seeking re-appointment at the AGM

The term of the Managing Director & CEO was up to March 312022.Before cessation and based on the recommendation of the Management Development Nominationand Remuneration Committee; the Board at its meeting held on November 112021 approved there-appointment of Mr. H P Ledwani for a period commencing from April 012022 up to April30 2023 subject to the consent of Members at the ensuing Annual General Meeting.

Details of changes in Directors and/or Key Managerial Personnel

During the year Mr. P Gopa Kumar ceased to be 'Chief FinancialOfficer' of the Company due to his untimely demise on September 27 2021. The organisationwishes to place on record his yeomen service to the Company.

Thereafter w.e.f. November 112021 Ms. Geetha D took additional chargeas 'Chief Financial Officer'.


Pursuant to the requirement under Sections 134(3) (c) and 134(5) of theAct with respect to the Directors' Responsibility Statement it is hereby confirmed:

• In the preparation of the annual accounts for the year endedMarch 312022; the applicable accounting standards read with requirements set out underSchedule III to the Act have been followed and there are no material departures from thesame.

• The Directors have selected such accounting policies and appliedthem consistently and made judgements 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 312022and of the profits of the Company for the year ended on that date.

• The Directors have taken proper and sufficient care formaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.

• The Directors have prepared the annual accounts on a 'goingconcern' basis.

• The Directors have laid down internal financial controls to befollowed and that such internal financial controls are adequate and are operatingeffectively and

• The Directors have devised proper systems to ensure compliancewith the provisions of all applicable laws and that such systems are adequate andoperating effectively.


The Board has accepted all the recommendations of the Audit Committeeand hence no further explanations have been provided for in this Report.


Board members

The Company has during the year conducted an evaluation of the Boardas a whole its committees and individual Directors including Independent Directors asstipulated in the Nomination and Remuneration Policy adopted by the Company & as perthe provisions of the Companies Act 2013 and Regulation 17(10) of the SEBI (LODR)Regulations 2015. The evaluation was carried out on the basis of the below set targets:

• Business strategies

• Corporate budget

• Capital expenditure

• Performance of products

• Committee wise reviews

Other parameters for such evaluation comprised - level ofparticipation integrity independence knowledge impact and influence on the Board. TheIndependent Directors of the Company also convened a separate meeting on February 09 2022and evaluated the performance of the Board Non-Independent Directors and the Chairman.The Board is confident that collectively and individually best possible efforts have beendrawn.

Staff members

Performance management systems are in place and timely reviews werefacilitated to provide feedback to the employees on their performance.


As part of internal controls the ERP environment has been plugged withstandard operating procedures (SOPs) including checks & balances besides approvalmatrix to ensure accuracy of financial and non-financial transactions. Further there areInternal and Branch audits conducted both on quarterly and on an annual basisrespectively by external Chartered Accountant Firms to ensure correctness of data.

During the year under review neither the Statutory Auditors nor theSecretarial Auditor have reported to the Audit Committee under Section 143(12) of theCompanies Act 2013 any instance of fraud committed against the Company by its officers oremployees the details of which need to be mentioned in the Board's report.


Statutory Audit

In respect of the financial year 2021-22 there are no qualification(s)or reservation(s) or adverse remark(s) or disclaimer(s) specified in the audit reports.Hence explanations or comments on the same do not become applicable.

Secretarial Audit

The Company has complied with all applicable provisions of theSecretarial Standards and Secretarial Audit Report for the financial year 2021-22 detailsof which forms part of the Annual Report.

Cost Audit

The Company maintains cost accounting records and has cost controlmeasures in place. As per best practices the Company also ensures conduct of cost audit.


Statutory Audit

M/s. Praveen & Madan Chartered Accountants (Firm Registration No.011350S) having office at No. 237 2nd cross Cambridge Layout Halasuru Bengaluru 560008 were appointed for a term of five years which will conclude at the end of the 47thAnnual General Meeting. The Company has received confirmation from the Auditors to theeffect that their appointment remains in accordance with the provisions of Section 141 ofthe Companies Act 2013 and they are eligible for re-appointment. The Board has placedtheir candidature for approval of the Members at the ensuing Annual General Meeting.

Secretarial Audit

The Board has appointed Ms. Manjula Narayan Company Secretary inPractice (ACS Membership No. 28374 & COP No. 10150) having office at #10 3rd Cross4th Main Vinayaka Layout Bhattarahalli Near Domino's Pizza Bengaluru - 560 049 as theSecretarial Auditor of the Company for the financial year 2022-23.

Cost Audit

M/s. Rao Murthy and Associates Cost Accountants (Firm Registration No.000065) having office at 23/33 Surveyor's Street Basavanagudi Bengaluru 560 004 havebeen appointed as the Cost Auditor and resolution for approval/ratification ofremuneration have been placed before the Members.


An extract of the Annual Return for the year 2021-22 in form MGT-7 inrespect of the previous year have been uploaded on the website at


Pursuant to the provisions of the Companies Act 2013 read with theIEPF Authority (Accounting Audit Transfer and Refund) Rules 2016 ('the Rules') notifiedby the Ministry of Corporate Affairs all unpaid or unclaimed dividend are required to betransferred by the Company to the Investor Education & Protection Fund aftercompletion of seven years.

Further according to the rules shares on which dividend has not beenclaimed by the Shareholder(s) for seven consecutive years or more will have to betransferred to the demat account of the IEPF Authority. Accordingly the Company hastransferred Rs.1599876 (Rupees fifteen lakhs ninety nine thousand eight hundred andseventy six only) and 27070 equity shares of Rs.2/- each to the IEPF Authority. Detailsof unclaimed dividend and equity shares transferred have been hosted on the website of theCompany.


During the financial year 2021-22 the Company contributed by way ofinter corporate deposit an amount of approximately rupees six crores and forty one lakhs.Given the proposition that

(i) Covid-19 pandemic is ongoing

(ii) Subsidiary was holding external debt

(iii) The Company has been maintaining treasury

(iv) Significant volatility in market could prove detrimental; theCompany over a period of two years repaid the borrowings of the subsidiary and substitutedthe same with Inter-Corporate-Deposit. Interest rate was pegged at nine percentsignificantly higher than the Reserve Bank of India's bank rate.


The Company during the financial year 2021-22 laid thrust on onlinesystems and solutions to create a niche digital platform. The website of the Company wasrevamped greater presence was made in social media like Facebook LinkedIn and Youtube.This is expected to have far reaching transitional effect on the method of managingbusiness.


The Company's products are manufactured to international standards withadherence to quality systems and marketed under registered Trademarks. Further theprimary logo of the Company 'Ador Fontech' is a registered mark and during the year2021-22 the Company has applied for registration 'Ador-peace of mind' under classes1267917192037 & 40 of the Trade Marks Act 1999.


During the financial year 2021-22 Inter-corporate-deposit (ICD) to 3DFuture Technologies Private Limited (3DFT) and Ador Powertron Limited were facilitated ofwhich principal along with interest were duly repaid by the latter. Being wholly ownedsubsidiary and still at the nascent stage ICD provided to 3DFT remained outstanding atthe end of the year.

The reckoning of interest for ICD was placed significantly higher thanthe bank rate. The requirement for ICD emanated from the need to bridge finance workingcapital requirements as per request letters received from the respective organisations.

Note: Aggregate of investments and loans provided are within the powersand limits specified under Sections 179 185 and 186 of the Companies Act 2013.


The spend on account of capital expenditure remained largelyconservative due to the ongoing pandemic.


The Company has not accepted any deposits from the public and as suchno amount on account of principal or interest on deposits from the public was outstandingas on the date of the Balance Sheet.


To have an optimum level of liquidity the Company ensured:

• It has healthy current ratio at all times of the year

• Best of efforts were channelised towards cost control/reductionof overhead expenses to the extent possible

• Ensured the credit cycle and investments are correctly managedto reduce default risk Further the Company continued to enjoy debt free status resultingin nil finance cost.


During the financial year 2021-22 the Company engaged in 44 activitiesinvolving a total payout of rupees thirty nine lakhs. Details of which have been providedas part of the Report on Corporate Social Responsibility. Incidentally the Company hassurpassed amount statutorily required to be spent on CSR activities.


There has been no significant material changes and commitmentsaffecting the financial position of the Company which has occurred between the end of thefinancial year and the date of this report. There were no significant orders passedagainst the Company by the Regulators or Courts or Tribunals impacting the going concernstatus and the Company's operations in the future.


The Company works on a cluster of professional staff members both fromsales and non-sales domain. The employees of the Company are skilled to perform activitiesas per the requirements of Key Result Area (KRAs) and Key Performance Indicators (KPIs).The Company is to a great extent policy driven with definitive good working culture. Thereis also a strong vigil mechanism (whistle-blower) policy in place and all employees haveaccess to the Chairman of the Audit Committee in case they may wish to report anyconcern.


The Company believes in providing a safe work environment to itsemployees. To ensure such an environment the Company has adopted 'Anti-Sexual-Harassment'policy which is in line with the requirements of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and Rules framed thereunder.

An internal complaints committee has been specially constituted toredress complaints under sexual harassment.

During the fiscal year 2021-22 there were no complaints received underthis category.


The first part of the financial year saw major surge in Covid-19infections particularly during the second wave. The best way to defend was to getvaccinated. The Company therefore had conducted mass vaccination programmes at itsfactories.

In this regard the Company wishes to place on record the best ofsupport extended by 'Bruhat Bengaluru Mahanagar Palike (BBMP)' particularly of the Doctorsand Administrative Staff Members.

Further the Company had also encouraged work from home (WFH) foremployees who could remotely perform their work until the second quarter of thefinancial year.

The Company still remains cautious to provide best and safe workingenvironment. It still continues with temperature checks disinfecting work place atconstant intervals and tries at best to maintain best hygienic work environment.


During the year the Company underwent ISO re-certification programmesand was accorded (i) ISO 9001:2015 (ii) ISO 14001:2015 and (iii) ISO 45001:2018 by DNV GLBusiness Assurance. While the first two were on Quality Certifications the third was onOccupational Health and Safety Management System.


The Company has adopted a 'Risk Management Policy' to identify assessmonitor and mitigate various risks which may impact the Company's business. The Companyhas an adequate framework to curtail any adverse impact on its core operations.

The Board of Directors and Management are committed towards identifyingmajor risks exposed to the business and means to mitigate the same.


The Company has sufficient insurance coverage encompassing AssetsInventories Transit covering movement of materials vehicles etc.

The Company has also covered employee related risks like Personnelaccident Workmen compensation Employee's deposit linked insurance scheme etc. in orderto safeguard their personal interests.


As required under the provisions of Section 178(3) of the CompaniesAct 2013 and Regulation 19 of SEBI (LODR) Regulations 2015 the Company had adoptedpolicy for Directors' appointment and remuneration including criteria for determiningqualifications positive attributes independence of Directors etc. Details onremuneration policy are explained in the Corporate Governance Report.


Related party transactions

All transactions entered in to with Related Parties as defined underthe Companies Act 2013 and Regulation 23 of the SEBI (LODR) Regulations 2015 during thefinancial year were in the ordinary course of business and on an arm's length pricingbasis and do not attract the provisions of Section 188 of the Companies Act 2013. Therewere no material significant transactions with related parties during the financial yearwhich were in conflict with the interest of the Company. Hence statement in form AOC-2 isnot required to be annexed to this report.

Suitable disclosures as required by the Accounting Standards have beenprovided in the notes to the Standalone and Consolidated Financial Statements. Theapproved policy on 'Related Party Transactions' has been made available on the website ofthe Company.

Insider trading

The Company has adopted 'Code of Conduct' for prevention of InsiderTrading with a view to regulate trading in securities by Directors and designated personsof the Company.

Further the Stock Exchange and Designated Employees were duly informedon the closure and opening of the trading windows.

Details of fees paid to the Statutory Auditors

The total fees for all services paid by Ador Fontech Limited to M/sPraveen & Madan Statutory Auditors for the year ended March 312022:

Name Amount (In Rs.)
Audit fees 500000
Certifications 75000
TOTAL 575000

Details of utilisation of funds raised through preferential allotmentor qualified institutional placement as specified under Regulation 32 of the SEBI (LODR)Regulations 2015

There were no funds raised by the Company through preferentialallotment or qualified institutional placement during the financial year 2021-22.

Certificate on non-disqualification of Directors

A certificate from the Practicing Company Secretary has been receivedby the Company stating that none of the Directors on the Board of the Company have beendebarred or disqualified from being appointed or to continue as Directors.

Other disclosures

The following reports have been annexed/appended and forms part of theDirectors' Report:

• Management discussion and analysis report

• Corporate governance report

• Report on CSR activities (including details of activitiesundertaken and amount spent)

• Conservation of energy technology absorption foreign exchangeearnings and outgo

• Particulars of arrangements/transactions made with relatedparties

• Particulars of employees

• Details of Subsidiary & Associates


All requisite documents have been uploaded on the website of theCompany ''.


The Company continues to sustain its commitment to highest levels ofquality superior service management robust information security practices and maturebusiness continuity management. These fundamental ethos and integrity will continue totranscend in the years to come.


Employees are always recognised as an invaluable asset of the Company.Their contribution during the phase of pandemic braving all odds is highly commendable.The Directors wish to place on record their deep sense of appreciation in acknowledgementof their yeomen service. On the same parlance also extend thankfulness and gratitude toall Government and Regulatory Authorities Municipal Corporations Financial InstitutionsShareholders Customers Authorised Dealers Channel Partners Suppliers besides allOrganisations associated with the Company for their continued patronage and splendidco-operation.

For Ador Fontech Limited
Bengaluru Chairman
May 19 2022 DIN:01585637