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Automotive Stampings & Assemblies Ltd.

BSE: 520119 Sector: Auto
NSE: ASAL ISIN Code: INE900C01027
BSE 00:00 | 20 May 474.45 19.95






NSE 00:00 | 20 May 473.80






OPEN 477.20
52-Week high 923.85
52-Week low 36.55
Mkt Cap.(Rs cr) 752
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 477.20
CLOSE 454.50
52-Week high 923.85
52-Week low 36.55
Mkt Cap.(Rs cr) 752
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Automotive Stampings & Assemblies Ltd. (ASAL) - Director Report

Company director report

Dear Members

Your Directors take pleasure in presenting the Thirtieth (30th) AnnualReport together with the Audited Financial Statements of your Company for the financialyear ended March 31 2020. The Management Discussion and Analysis forms part of thisReport.


(' in Lakhs.)


Financial Year

2019-20 2018-19
Revenue from Sale of Products / Services (Net) 36224.42 48127.53
Other Operating Revenue 15.88 39.71
Other Income 44.41 199.11
Total Revenue 36284.71 48366.35
Cost of Materials Consumed (including change in inventories) 27913.39 36186.49
Employee Benefit Expense 3445.18 3750.00
Other Expenses 5836.07 7066.90
Earnings / (Loss) before Depreciation Financial Charges and Tax (EBIDTA) (909.94) 1362.96
Finance cost 1748.27 1650.05
Depreciation and Amortization Expense 1131.16 975.66
Profit / (Loss) before exceptional item and Tax (3789.37) (1262.75)
Exceptional items 2100.00 -
Tax Expense / (Credit) 12.00 -
Profit/ (Loss) for the year (1701.37) (1262.75)
Other Comprehensive Income (OCI) (26.89) (1.29)
Total Comprehensive Income/ (loss) (net of taxes) (1728.26) (1264.04)


Due to the loss incurred by the Company during the year the Board ofDirectors of the Company has not recommended any dividend.


Due to the loss incurred by the Company during the year your Companyis not required to transfer any amount to General Reserve Account under the Companies Act2013.


The paid up Equity Share Capital as at March 31 2020 was Rs 1586.44Lakhs comprising of 15864397 equity shares of '10 each. During FY 2019-20 your Companyhas neither issued any shares with differential voting rights nor has granted any stockoptions or sweat equity. As on March 31 2020 none of the Directors or the Key ManagerialPersonnel of the Company holds instruments convertible into equity shares of the Company.



The Indian Automobile Industry is made up of Original EquipmentManufacturers (OEMs) i.e. Automobile manufacturers and auto component manufacturers.

Indian automobile industry is among the largest automobile industriesacross the globe. The Automobile Industry is a growing sector in India with global majorshaving set up their facilities here. The Industry has been continually evolving andabsorbing newer technologies in order to align itself with global developments.Additionally the Indian automobile industry is anticipated to observe major changes inthe form of electric vehicles (EVs) shared mobility Bharat Stage (BS)-VI emission andsafety norms which significantly influence the growth of automobile industry in thecountry.

The Auto Components Industry in India comprises of Tier Onemanufacturers who supply complete component modules to OEMs Tier Two manufacturers whocater to Tier One manufacturers and Tier Three manufacturers who supply components to TierTwo manufacturers. The Industry is divided into five segments viz. engine partstransmission drive & steering parts suspension & brake parts electric parts andbody & chassis. The fortunes of the Auto Components Industry are closely linked withthose of the OEMs and must be agile to adopt the changes in technology. Apart from thisit has to continuously raise the quality and delivery performance in stride with therequirements of OEMs.

Auto component manufacturers would need to keep pace with the changingneeds of automotive OEMs who in turn are coping with the dynamic expectations of the endcustomer consolidation of platforms to reduce complexity and Cost which includesconstantly shifting market dynamics due to changing customer demands and operating modelsand the changing needs of OEMs who are likely to want different more agile and just intime deliveries.

Indian auto industry has already been reeling under severe de-growthand the pressure of disrupted supply chain only aggravated the situation. Auto industryhas been under pressure due to a mix of demand and supply factors.

For the first time in FY 2019-20 the Auto Industry witnessed anegative growth of 14.73 per cent. The Passenger Vehicle segment which includes passengercars vans and utility vehicles registered a negative growth of 14.76 per cent. Withinthis segment while the Utility vehicle market grew at 2.29 per cent the Van segment andthe Passenger Car segment recorded a negative growth of 38.49 per cent and 19.77 per centrespectively. The Commercial Vehicle segment also registered a negative growth of 32.40per cent. Within the CV segment the M&HCV segment registered a negative growth of47.34 per cent and LCV segment registered a negative growth of 22.45 per cent. The Twowheeler segment registered a negative growth of 14.14 per cent and three wheeler segmentsregistered a negative growth of 10.64 per cent also.

GDP growth of Indian economy is likely to be negative in FY 2020-21 asthe outbreak of Coronavirus COVID- 19 has disrupted economic activities . (Source: RBI )

The chart given below shows the production of various categories ofvehicles during FY2019-20 vis-a-vis FY2018-19.

Segment FY2019-20 FY2018-19

% Growth

Passenger cars 2175242 2711160 (19.77)
Utility vehicles 1124975 1099780 2.29
Vans 133798 217531 (38.49)
Passenger Vehicles 3434015 4028471 (14.76)
M&HCVs 233979 444356 (47.34)
LCV 518043 668049 (22.45)
Commercial vehicles 752022 1112405 (32.40)
Three Wheelers 1133858 1268833 (6.46)
Two wheelers 21036294 24499777 (14.14)
Quadricycle 6095 5388 13.12
Total of All Categories 26362282 30914874 (14.73)
Source SIAM report

The Indian automobile industry has been going through a tough phase fora while now with a slowing economy changes in emission & safety regulations and manyother challenges. The onset of COVID-19 and the extended lockdown to contain it haveonly made things worse. The Indian Auto Components Ancillary Industry continues to faceadverse headwinds to maintain volumes and margins. Your Company operates in Sheet MetalComponents Assemblies and Sub-assemblies segment of the Auto Components Industry. Itmanufactures a range of sheet metal components and assemblies for the Automobile Industryand is a Tier One auto components supplier.


During the period under review your Company has four manufacturingfacilities at Chakan Unit-1 Chakan Unit- 2 Pune (Maharashtra) Halol (Gujarat) andPantnagar (Uttarakhand).

Your Company in FY 2018-19 has shifted manufacturing operations locatedat Bhosari in order to achieve operational efficiency and productivity improvements from'G-71/2 MIDC Industrial Area Bhosari Pune: 411026 Maharashtra India' to leasedpremises located at 'Survey No. 679/2/2 Alandi Road Kuruli Chakan Taluka - KhedDistrict- Pune: 410 501 Maharashtra India'.

During the period under review your Company has transferred leaseholdrights in the land along with building located at G-71/2 MIDC Industrial Area BhosariPune: 411026 Maharashtra to Fronius India Private Limited M/s. Pradeep Sweet Icon andM/s Mittal Engineering Works respectively after obtaining necessary approvals from MIDCand concerned authorities.

Financial Year 2019-20 has been a challenging year with weakeningmacro-economic conditions slowing market growths in Auto sector and finally COVID-19outbreak and containment measures towards the end of the year. The Ministry of HomeAffairs Government of India on March 24 2020 notified the first ever nationwide lockdownin India to contain the outbreak of Covid-19 pandemic. The Financial Year 2019-20 endedwith the pandemic situation created by the spread of the Corona virus COVID-19 all overthe world and day to day life across the globe came to a virtual stop and your Company wasnot an exception. The operations were disrupted at all the manufacturing facilities of theCompany. Your Company had to put a halt on its operations for some period during March2020 to May 2020 caring more for the wellness and safety of its people and complyingwith Government and Health authorities advisories during lockdown.

The Company is taking all necessary measures in terms of mitigating theimpact of the challenges being faced in the business. The Company is working towards beingresilient in order to sail through the current situation. It is focused on controlling thefixed costs maintaining liquidity and closely monitoring the supply chain to ensure thatthe manufacturing facilities operate smoothly.

Your Company operates its business in conformity with the highestethical and moral standards and employee centricity. In view of the outbreak of thepandemic your Company undertook timely and essential measures to ensure the safety andwell-being of its employees at all its plant locations and office.

During the time of uncertainty Company's volunteers had workedaggressively to support your Company & community around Company's locations. YourCompany took a number of measures to ensure effective management of the situation whilecontinuing to serve community and customers effectively. Apart from this your Companyalso provided the Local Administration / Corona Warriors with Touch free temperaturemeasurement (Three Time in a day) Three number & color Face Masks no touch SanitizerStations no touch Drinking Water tabs Face Shield installation of 'Aarogya Setu App'Social distance marking at prominent locations conducting awareness session no visitorPolicy compulsory Medical report to join the duty Quarantine area identification tosupport them in their tryst with this pandemic overall in the plants.

Majority of the employees were given the option to work from homeduring the lockdown period and a Task force of senior management ensured developingstrategies and monitoring them for Business continuity activities. The Company observedall the government advisories and guidelines thoroughly and in good faith.

Your Company's sales during the year were impacted by lower volumesthan expected in all segments considering various developments in auto sector like BS- VInorms transition introduction of Electric Vehicles in Passenger Vehicle segment resultedinto low inventory / production for all OEMs & which was further exacerbated byCOVID-19 related lockdown in March 2020. Some of the models under Passenger Car segmentand Commercial Vehicles segment on which your Company has heavy dependence recorded dropin volume and this had an adverse effect on sales. Even though the Utility Vehicleproduction recorded meager growth of 2.29 per cent your Company couldn't achievecorresponding growth since the major customer including anchor customer of your Companyrecorded a negative growth in all segments.

Sales of your Company did not grow as expected due to slower ramp up ofnew businesses and lower off-take from key customers. The capacity utilization of yourCompany was therefore low as compared to last year. During the financial year 2019-20 themanufacturing costs decreased due to reduced sales and change in product mix as comparedto previous financial year 2018-19. However to minimize the impact your Company hasidentified 5 EBITDA Pillars for various cost reduction initiatives to enhance productivityand improve operational efficiencies and Cross Functional Team is formed to regularlymonitor the same. The Management is confident that the cost reduction initiatives andoperational efficiencies are sustainable. Your Company has been aggressively managing itsnet working capital and was able to keep it under control.

Apart from the cost reduction programmes your Company has beenaggressively pursuing new business opportunities in Off- road Commercial Vehicles andThree Wheeler Segment by targeting greater share of business from existing and newCustomers and ramp up of business in Utility Vehicle Segment. This will not only increasethe sales but also will help to reduce the dependency on one segment resulting in reducingoverall risk.

Your Company is focused on achieving volume growth reduction in costsand improving product portfolio. These measures will continue to drive improvement in yourCompany's business.


During the year under review the net Sales dropped by 24.73 per centto Rs 36224.42 Lakhs as compared to previous year primarily due to reduction in Customervolumes & lower off take from key Customers. Other operating revenue decreased from Rs39.71 Lakhs to Rs 15.88 Lakhs. Other income of Rs 44.41 Lakhs mainly consists of gain onsale of assets of Rs 36.45 Lakhs and other non- operating income of Rs 7.96 Lakhs.

Cost of materials consumed (including change in stock) as a percentageto sales increased by 1.90 per cent to 77.03 per cent because of change in the productmix. In order to mitigate the impact your Company is taking various cost reductioninitiatives like negotiations with customers and vendors blank optimisation bandtolerance CTS (Cut to Size) to coil ratio grade change resourcing and change in theproduct mix. The Management has been taking continuous steps to improve material yield.

Employee benefits expense decreased by 8.12 per cent as compared toprevious year due to changes in manpower requirements and outsourcing.

Other Expenses comprising Administration and Selling Expenses havedecreased to Rs 5836.07 Lakhs largely due to reduction in sales as compared to previousyear & costs related to rent and leasing logistic costs freight and forwardingcharges rates and taxes power and fuel packing materials machinery repairs andmaintenance consultancy fees etc. During FY 2019-20 Finance cost increased to Rs1748.27 Lakhs due to increased borrowings.

Your Company is taking various initiatives on productivity improvementsand cost reduction Programmes.

Key Financial Ratios

Ratios 31.3.2020 31.3.2019 % change
1 Debtors Turnover 11.44 12.06 (5.15)
2 Inventory Turnover 20.19 26.92 (24.98)
3 Interest Coverage Ratio 0.67 0.83 (18.42)
4 Current Ratio 0.36 0.51 (30.05)
5 Debt Equity Ratio 9.03 6.98 29.28
6 Operating Profit Margin (%) (5.63) 0.80 (800.44)
7 Net Profit Margin (%) (4.69) (2.62) 79.07
8 Return on Net Worth (28.92) (30.39) (4.85)


1. Current ratio is decreased as compared to previous FY 2018-19 mainlydue to reduction in inventories and trade receivables.

2. Increase in debt during FY 2019-20 as compared to previous FY2018-19 resulted in higher debt equity ratio.

3. During the year under review the net Sales dropped by 24.73 percent to Rs 36224.42 Lakhs as compared to previous year primarily due to reduction inCustomer volumes & lower off take from key Customers. The capacity utilization of yourCompany was therefore low as compared to last year resulting in reduced operating profitmargin and thus reduced net profit margin as well in FY 19-20 as compared to FY 18-19.


Investment in Technology / Process

To meet the Customer's expectations it is important for the automotiveindustry to continuously upgrade its technology and processes. Your Company is alsoupgrading its technology to participate in new vehicle programmes launched by Customers.During the year under review your Company has implemented and productionised automation inWeld Shop for various new programmes especially at Chakan plant. Your Company hasimplemented SCADA (Supervisory Control and Data Acquisition) based Automated BAR CODESystem. SCADA is a control system architecture comprising computers networked data

communications and Graphical User Interfaces (GUI) for high-levelprocess supervisory management while also comprising other peripheral devices likeprogrammable logic controllers (PLC) and discrete proportional-integral-derivative (PID)controllers to interface with process plant or machinery. All these efforts have resultedin improvement in productivity and customer satisfaction.

The profitability of the Indian Auto Components Industry is likely tocontinue to be subdued due to pricing pressures from OEMs.

• Company's own technology / processes / system improvement plan:

Your Company is undertaking various new technology initiatives processupgradation and system enhancements like installation of Robotic Welding Lines for newCustomer programmes at Chakan and Pantnagar plants

During the year under review you Company has implemented and upgradedits current SAP version to latest version “SAP S/4 HANA” and the same has gonelive in FY 2019-20. SAP S/4 HANA is a combination of Database Hardware and Software forfast & quick computation. which allowed your Company for a digital transformation.


Your Company operates only in the Automobile Component Segment in theDomestic Market.


The Indian economy registered a growth of 4.2% in FY 2019-20 muchlower than the 6.1% in FY 2018-19 (Source: IMF). The Government of India undertook variousinitiatives and announced '1.70 lakh crore relief package to help India's marginalisedpopulation tackle the challenges caused by the COVID-19 pandemic. The Reserve Bank ofIndia ('RBI') provided a monetary stimulus by slashing the repo rate to 5.15% a cut of135 basis points in FY 2019-20 to boost demand and private consumption.

According to outlook of SIAM in financial year 2020-21 as a result ofthe impact of a long drawn out recovery from the coronavirus pandemic in India it isestimated 24 per cent drop in Passenger Vehicle sales and 35 per cent drop in CommercialVehicle sales in overall automobile sector in the worst case scenario depending on GDPgrowth of the Country.

Your Company faces tough market conditions amid the coronaviruspandemic acute challenges with the overall auto sector witnessing slowing sales stemmingfrom sluggish economic activity weak liquidity tight financing norms and poor consumersentiment. This may affect overall performance of the Company. Auto sector is expected torecover partly in the second half of the FY 2020-21 as sales gradually increase after theeasing of lockdown measures since May 2020.

Your Company is taking all necessary measures in terms of mitigatingthe impact of the challenges being faced in the business with the required support frompromoter Company as well. Your Company is poised to the market conditions and focusingmore on Off road & Commercial Vehicle segment wherein recently Government hasannounced economic relief package to agriculture & infrastructure sector. Your Companyhas prepared a strategic plan for the next five years which is now getting updated aftergiving the unexpected effect of COVID -19 outbreak on Company's performance for theFinancial year 2020-21. The said plan takes into account reductions in costs throughoperational efficiency improvement initiatives and rationalization of existingoperations adding new businesses and increase in sales volumes from the existing and newcustomers etc. which will help in improving the Company's future financial performance.

However key concerns relate to slow down in economy fast recovery ofauto industry higher prices with BS-VI rollout impact of Axle load norms rise incommodity price and dipped consumer sentiment owing to uncertainty surrounding thePandemic continue to be challenges for the auto industry.


Your Company has systems in place to identify assess monitor andmitigate various risks to key business objectives. Major risks identified by thebusinesses and functions are systematically addressed through mitigating actions on acontinuing basis. These are discussed regularly at Audit Committee meetings.

Risks Identified and Mitigating actions:

• Concentrated Customer Base: Your Company has taken steps tomitigate this risk by business development activities to enhance the customer base andstriving to increase share of business with existing customers where Company's share islow.

• Rising input costs: Rising input costs are a risk and henceyour Company has on going improvement initiatives like conversion cost reduction supplychain efficiency improvement and material yield improvement.

• Skill Availability: Your Company focuses on recruitment andin-house skill development to address this challenge.

• Market risk: The COVID-19 pandemic can lead to disruption insupply chain management and manufacturing processes that may impact business goals andprofitability. Your Company is taking all necessary measures to minimise the impact ofCOVID-19 outbreak.

Your Company is working diligently to mitigate the above risks andconcerns.


Discussion on state of Company's affairs has been covered as part ofthe Management Discussion and Analysis.


Internal financial control systems of the Company are commensurate withits size and the nature of its operations. Your Company has developed internal controlsystems by documenting procedures covering financial and operating functions. Thesesystems are providing a reasonable assurance with regard to its financial and operationscontrols. The Audit Committee satisfied itself of the adequacy and effectiveness of theinternal financial control system as laid down and kept the Board of Directors informed.

Some significant features of the internal control systems are:

• SAP is used for control of all transactions including financematerials dispatch quality costing etc. across all locations.

• A detailed preparation and subsequent monitoring of both AnnualBudgets & Capital Expenditure budgets for all its functions.

• Internal audits are conducted by external auditors and theyaudit all aspects of business based on audit programmes finalized by the Audit Committee.

• Review of the financial performance by Audit Committee.


Note No. 35 of the Financial Statements sets out the nature oftransactions with Related Parties. Transactions with Related Parties are carried out inthe ordinary course of business and at arm's length. The details of the transactions aretabled before the Audit Committee. Further details on this are explained in the CorporateGovernance Report. None of the transactions with related parties falls under the scope ofSection 188 (1) of the Companies Act 2013. Hence no particulars are being provided inForm AOC-2.


Pursuant to the provisions of the Companies Act 2013 and Rules madethere under amended from time to time your Company is not mandatorily required to spendany amount in view of the losses. Your Company has however been undertaking CSRinitiatives voluntarily. CSR Committee constituted in terms of Section 135 of theCompanies Act 2013 monitors the CSR activities undertaken by the Company as per CSRPolicy. The CSR Policy has been uploaded on the website of the The employees from all plants of the Company voluntarily contributetheir time by visiting orphanages/ old age homes schools etc. to provide somecompanionship and succour to children and aged people.


Your Company is committed to provide a safe secure and healthyworkplace and this has been documented in the Health Safety and Environment (HSE) policywhich is part of the Overarching Wellness strategy of your Company. Your Company hastherefore adopted a comprehensive approach to implement this by adopting 'Total SafetyCulture' concept across its operations. All the Plants of your Company have been certifiedfor EMS 14001 and OHSAS 18001 and National Safety Council (NSC). During the period underreview all plants are especially focused on the wellness initiative like road safetytraffic management in plant premises and monthly wellness programme have been conducted byGroup Medical Chief.

Your Company has engaged the British Safety Council (BSC) forcertification. Your Company is in process of getting BSC Certification in the FY 2020-21.Internal Audits of BSC for health safety and environment have been conducted at allPlants every quarter wherein all plants received 5 star ratings. Further safety trainingand awareness initiatives have been undertaken during the year. Health checks andcounseling are extended to employees by Group Medical Chief. During the year under reviewyour Company's Pantnagar plant has received “Road Safety award” from Tata MotorsLtd.

During the year the approach to safety has been further strengthenedin all operations of your Company. Regular safety drills and safety audits are conductedat all plants. The requisite training is provided to the employees in Safety.

Your Company has taken initiatives to reduce its carbon footprint byreducing power consumption and selling steel scrap to be reprocessed and sold.

There is a continued focus on tracking of “near miss”incidences which has resulted not only in reduction of reportable accidents but even infirst aid injuries and non- reportable accidents. Safety competitions presentations onsafety kaizens mock drills etc. are conducted for achieving a safe and healthy workenvironment.

Your Board of Directors are regularly updated on Health Safety andEnvironment related matters.


All the manufacturing Plants of your Company are certified under TS16949 and ISO 14001 18001. Your Company has been implementing the Tata BusinessExcellence Model to build excellence in its business operations.


Appointment of Directors

During the year under review the Board based on the recommendations ofNomination and Remuneration Committee appointed of Ms. Bhavna Bindra (DIN: 07314422) asan Additional Director designated as Non-Executive Independent Director of the Board witheffect from July 15 2019 to hold office upto the date of ensuing Annual General Meeting.Pursuant to the provisions of Section 161 of the Companies Act 2013 and Article 37 of theArticles of Association of the Company Ms. Bhavna Bindra is eligible for appointment asNon-Executive Independent Director of the Company. Her appointment is for a term of 5(five) consecutive years commencing from July 15 2019 up to July 14 2024. As per theprovisions of

Section 149 of the Act she will not be liable to retire by rotation.Members are requested to refer to Item No.3 of the Notice of the 30th Annual GeneralMeeting and the Explanatory Statement for details of her qualifications and experience. Incompliance with the provisions of Companies Act 2013 the appointment Ms. Bhavna Bindrais being placed before the Members in the ensuing Annual General Meeting for theirapproval.

At the 29th Annual General Meeting of the Company held onJuly 1 2019:

1) Mr. Pradeep Bhargava and Ms. Rati Forbes were re-appointed asIndependent Directors of the Company for second term of four consecutive years and oneconsecutive year respectively wef July 22 2019.

2) Mr. Arvind Goel (DIN 02300813) and Mr. Sanjay Sinha (DIN: 08210898)were appointed as NonExecutive and Non-Independent Directors of the Company liable toretire by rotation.

The Board appointed Mr. Pradeep Bhargava Non-Executive IndependentDirector as the Chairman of the Board wef April 24 2019.

Retirement / resignation of Directors

Mr. Bharat Parekh (DIN: 01521346) retired by rotation and wasre-appointed in the 29th Annual General Meeting held on July 01 2019. Mr. Sanjay Sinha(DIN: 08210898) will retire by rotation at the conclusion of the ensuing Annual GeneralMeeting and being eligible has offered himself for re-appointment.

During the period under review Ms. Rati Forbes Non- ExecutiveIndependent Director has conveyed to the Board that considering professional commitmentsshe was unable to devote sufficient time required of an Independent Director of theCompany and therefore willingly tendered her resignation effective from close of businesshours of July 18 2019 i.e. before expiry of her second term of 1 consecutive year. TheCompany has received confirmation from Ms. Rati Forbes that the resignation is due to herpersonal reasons and that there are no other material reasons other than those provided.

The Board of Directors placed on record its sincere appreciation forthe valuable guidance and immense contributions made by Ms. Rati Forbes during her tenureas Director of the Company and wished her well for future endeavors.

Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Companies Act 2013the Key Managerial Personnel of the Company are: Mr. Jitendraa Dikkshit Managerdesignated as Chief Executive Officer Mr. Yogesh Jaju Chief Financial Officer and Mr.Ashutosh Kulkarni Company Secretary.

During the period under review Mr. Neeraj Shrivastava resigned as aManager designated as Chief Executive Officer of the Company with effect from close ofworking hours of May 3 2019. The Board placed on record its sincere appreciation forvaluable contribution made by him during his tenure with the Company.

Mr. Jitendraa Dikkshit was appointed as Manager designated as ChiefExecutive Officer of the Company for a term of 3 years w.e.f. October 17 2019. Theapproval of the Members will be obtained for his appointment and remuneration at theensuing Annual General Meeting. Members are requested to refer to Item No. 4 of the Noticeof the Annual General Meeting and the Explanatory Statement for details.

During the year Mr. Easwaran S. resigned as Chief Financial Officer ofthe Company with effect from close of working hours of September 20 2019. The Boardplaced on record its sincere appreciation of the services rendered by him during histenure with the Company.

Mr. Yogesh Jaju has been appointed as Chief Financial Officer of theCompany w.e.f. March 12 2020.


Pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and as per Guidance Note onBoard Evaluation issued by SEBI on January 5 2017 the Board has carried out the annualperformance evaluation for FY 2019-20 of (a) its own performance; (b) the Directorsindividually; and (c) the working of its Committees viz. 'Audit Committee' 'Nominationand Remuneration Committee' 'Corporate Social Responsibility Committee' and the'Stakeholders Relationship Committee'. The details of evaluation process have beenexplained in the Corporate Governance Report.


The details of the Remuneration Policy as approved and adopted by Boardare stated in the Corporate Governance Report.


The Company has adopted the Guidelines on Board Effectiveness(“Governance Guidelines” or “guidelines”) which inter-alia cover thecriteria for determining qualifications attributes and independence of a Director. Thedetails of the Policy are stated in the Corporate Governance Report.


The Company has received necessary declarations from all theIndependent Directors under Section 149 (7) of the Companies Act 2013 and SEBI ListingRegulations that :

a) they meet the criteria of independence laid down in Section 149 (6)of the Companies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.

b) they are not aware of any circumstance or situation which exist ormay be reasonably anticipated that could impair or impact their ability to dischargetheir duties with an objective independent judgment and without any external influencepursuant to Regulation 25 of the Listing Regulations.

c) they have complied with the requirement of inclusion of their namein the data bank maintained by Indian Institute of Corporate Affairs as envisaged underCompanies (Appointment and Qualification of Directors) Fifth Amendment Rules 2019 asapplicable and they hold valid registration certificate with Data Bank of IndependentDirectors.


The details of Board and Committee meetings held during the year aregiven in the Corporate Governance Report.


During the year under review there has been no change in the nature ofbusiness of the Company.


There have been no material changes and commitments which affect thefinancial position of the company which have occurred between the end of the financialyear to which the financial statements relate and the date of this Report.


There are no significant or material orders passed by the Regulators /Courts which would impact the future operations / going concern status of the Company.


There are no loans guarantees or investments made by Company underSection 186 of the Companies Act 2013.


The Company has not accepted deposits under Chapter V of the CompaniesAct 2013 during the year under review. No amount on account of principal or interest ondeposit from public was outstanding as on March 31 2020.


In terms of Regulation 34 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 the Report on Corporate Governance along with theCertificate of Compliance from the Auditors forms part of this Report.


Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the internalstatutory and secretarial auditors including audit of internal financial controls overfinancial reporting by the Statutory Auditors and the reviews performed by the Managementand the relevant Board Committees including the Audit Committee the Board is of theopinion that the Company's internal financial controls were adequate and effective duringthe financial year 2019-20.

Accordingly pursuant to Section 134 (3) (c) and 134 (5) of theCompanies Act 2013 the Board of Directors to the best of their knowledge and abilityconfirm that:

1. in the preparation of the annual financial statements for the yearended March 312020 the applicable accounting standards have been followed and there areno material departures;

2. accounting policies have been selected and applied consistently andjudgments and estimates that are reasonable and prudent have been made so as to give atrue and fair view of the state of affairs of the Company as at March 31 2020 and of theloss of the Company for the year ended on that date;

3. proper and sufficient care have been taken for the maintenance ofaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company for preventing & detecting fraud and/or other irregularities;

4. the annual accounts have been prepared on a going concern basis;

5. internal financial controls have been laid down by the Company andthat such internal financial controls are adequate and are operating effectively; and

6. proper systems have been devised to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.


The information on conservation of energy technology absorption andforeign exchange earnings and outgo stipulated under Section 134 (3) (m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 is annexed as AnnexureI to this Report.


Pursuant to Section 92 (3) of the Companies Act 2013 and Rule 12 (1)of Companies (Management and Administration) Rules 2014 as amended from time to time theextract of Annual Return in Form MGT-9 is annexed as Annexure II to this Report.

The extract of the Annual Return of the Company can also be accessed onthe website of the Company at


At the end of March 2020 your Company had 570 employees (excludingtrainees and apprentices) as compared to 591 employees as on March 31 2019.

Your Company accords high importance in building and sustaining healthyemployee engagement with the aim of achieving competitive productivity and harmonious workenvironment. The industrial relations during the year remained peaceful. With a view toensure prompt resolution of employee's grievances various Committees have been set upunder the capable Chairmanships which are guided by Functional Heads / Department Headse.g. Works Committee Health Safety and Environment Committee Prevention of SexualHarassment Committee (POSH) etc. The functioning of these Committees are regularlyreviewed by the Management and the Board is also updated regularly. During the year theEmployee Engagement Survey has been carried out which had shown significant improvementfrom 37 per cent in year 2013 to 71 per cent in year 2019.

Your Company has HR help desk to resolve grievances/day to day issuesof employees within time bound manner. This results in maintaining transparent culture andhelp to increase satisfaction level of the employees.

Considering the competitive market scenario it has become essential tohave substantial improvement in the productivity on the shop floor. Your Company has beenimplementing TPM WCSQ Kaizen and other various systems to improve overall performance ofall plants.

Information required under Section 197 (12) of the Companies Act 2013read with Rule 5 (1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is set out in Annexure III to this Report.

Information required under Section 197(12) of the Companies Act 2013read with Rule 5 (2) (i) to (iii) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is not given since there is no employee who receivedremuneration in excess of the limits prescribed therein.

The information required under Rule 5(2) and (3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided in theAnnexure forming part of the Report. In terms of the first proviso to Section 136 of theCompanies Act 2013 the Report and Accounts are being sent to the Members excluding theaforesaid Annexure. Any Members interested in obtaining the same may write to the CompanySecretary at e-mail - None of the employee listed in the saidAnnexure is related to any Director of the Company.


Your Company has adopted a Policy on Prevention Prohibition andRedressal of Sexual Harassment at the Workplace in line with the provisions of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013 and theRules there under. The Policy aims to provide protection to employees at the workplace andprevent and redress complaints of sexual harassment and for matters connected orincidental thereto with the objective of providing a safe working environment whereemployees feel secure. Your Company has also constituted an Internal Complaints Committeeknown as the Prevention of Sexual Harassment (POSH) Committee to inquire into complaintsof sexual harassment and recommend appropriate action. Awareness Programmes were conductedat various plants of the Company.

Your Company has not received any complaint of sexual harassment duringthe financial year 2019- 20.


The details of Risk Assessment framework are set out in the CorporateGovernance Report forming part of the Board's Report.


Your Company has adopted a vigil mechanism. The details of the same areexplained in the Corporate Governance Report and also posted on the website of theCompany.


Your Company did not have any subsidiaries associates or jointventures during the year under review. AUDITORS

1. Statutory Auditors:

At the 27th AGM held on July 28 2017 pursuant to theprovisions of the Act and the Rules made thereunder B S R & Co. LLP CharteredAccountants Pune (Firm Registration no. 101248W/W-100022) were appointed as StatutoryAuditors of the Company to hold office for a period of 5 years from the conclusion of 27thAGM held on July 28 2017 till the conclusion of 32nd AGM to be held in FY2022-23.

The Statutory Auditors' Report for FY 2019-20 on the financialstatement of the Company forms part of this Annual Report.

There are no qualifications reservations or adverse remarks made bythe statutory auditors in their audit reports on the financial statements for the yearended March 31 2020. The observations of the Statutory Auditors in their Reports areself-explanatory and therefore Directors don't have any further comments to offer on thesame.

2. Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors had appointed C.S. Kelkar & Associates Practicing CompanySecretaries for conducting Secretarial Audit of the Company for FY 2019-20. The Report ofthe Secretarial Audit is annexed herewith as Annexure IV to this Report. There areno qualifications reservations or adverse remarks or disclaimer in the said report andtherefore Directors don't have any further comments to offer on the same

Pursuant to Listing Regulations read with SEBI circular No.LIST/COMP/14/2018 dated June 20 2018 a certificate from C.S. Kelkar & AssociatesPracticing Company Secretaries that none of the Directors on the Board of the Company havebeen debarred or disqualified from being appointed or continuing as directors of companiesby the Board/Ministry of Corporate Affairs or any such statutory authority is annexed toCorporate Governance Report.


The Directors have devised proper systems and processes for complyingwith the requirements of applicable Secretarial Standards issued by the Institute ofCompany Secretaries of India (‘ICSI') and that such systems were adequate andoperating effectively.


During the year under review neither the statutory auditors nor thesecretarial auditors has reported to the Audit Committee under Section 143 (12) of theCompanies Act 2013 any instances of fraud committed against the Company by its officersor employees the details of which would need to be mentioned in the Board's report.


Certain statements describing the Company's Estimates ProjectionsExpectations Future Outlook Industry Structure and Developments may be construed“forward-looking statements” within the meaning of applicable laws andregulations. Actual results may differ materially from those either expressed or impliedin this Report.


Your Directors place on record their sincere thanks and appreciationfor the confidence reposed and continued support extended by Central and StateGovernments Bankers Customers Suppliers and Members. Your Board would like to place onrecord its sincere appreciation to the employees for the dedicated efforts andcontribution in playing a very significant part in the Company's operations.

For and on behalf of the
Board of Directors
(Pradeep Bhargava)
(DIN: 00525234)
Place: Pune
Date : July 08 2020