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Bartronics India Ltd.

BSE: 532694 Sector: IT
NSE: BARTRONICS ISIN Code: INE855F01034
BSE 00:00 | 30 Sep 4.01 0.06
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NSE 00:00 | 30 Sep 4.00 0.10
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OPEN 3.78
PREVIOUS CLOSE 3.95
VOLUME 5894
52-Week high 10.85
52-Week low 2.76
P/E
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
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OPEN 3.78
CLOSE 3.95
VOLUME 5894
52-Week high 10.85
52-Week low 2.76
P/E
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Bartronics India Ltd. (BARTRONICS) - Director Report

Company director report

To the Members

Your Directors and Resolution professional have pleasure in presenting the Twenty NinthAnnual Report and the Audited Financial Statements of the Company for the financial yearended 31st March 2021.

I. FINANCIAL PERFORMANCE:

Your Company has achieved a turnover of Rs. 6343.90 lakhs for the financial year ended31st March 2021 against the turnover of Rs. 6801.17 lakhs for the previous year ended31st March 2020. Key highlights of financial performance of your Company for thefinancial year 2020-21 are provided below:

(Rupees in Lakhs)

Particulars 2020-2021 (12 months) 2019-2020 (12 months)
Profit Before Depreciation & Interest 619.64 1008.87
Financial Costs 5239.53 5239.95
Depreciation 428.29 454.95
Profit Before Tax (5048.17) (4686.03)
Provision for Tax
- Current Tax - -
- Deferred Tax 124.95 (441.43)
Profit After Tax (4923.23) (5127.45)
B alance of profit brought forward from earlier years (28374.49) (26008.20)
Add: Excess Provision for IT written off - -
Less : OCI (778.84) 2761.16
Profit available for appropriation (34076.56) (28374.49)
Appropri ation s: - -
Proposed Dividend:
- Equity - -
- Preference - -
- Dividend Tax - -
Balance of Profit (34076.56) (28374.49)

Business:

Your company started with proving solutions based on barcode and has emerged as leadingplayer in the country to provide solutions using umbrella of AIDC technologies. Yourcompany also has state of the art manufacturing facility with the capacity to manufacture80mn smart cards per annum. Using these two synergies the company could successfullyventure into Financial Inclusion projects driven by Reserve Bank of India

popularly known as "Jan Dhan Yojana". The exposure to government drivenprojects give your company revenue visibility and we expect this momentum to continuegiven the un-deterred Government's focus.

Foreign Currency Convertible Bonds (FCCB):

Bartronics India Ltd. had issued Foreign Currency Convertible Bonds (FCCB) for anaggregate sum of USD 50mn in January 2008. These bonds got matured in February 2013. Inthis regard the company had filed a request for an extension of the maturity of the bondsto May 4 2014 with Reserve Bank of India which was granted by them vide their letterdated February 21 2014. The Company has applied for further extension of the maturitywith Reserve Bank of India and is waiting to hear from RBI to move forward.

However On December 2 2019 your comp any got admitted under CIRP and the courtappointed Shri. Chinnam Poorna Chandra Rao as ‘Resolution Professional' for thecompany. Some Bondholders who accessed company disclosures and public announcements madeby the Resolution Professional have submitted their claim. As laid by the law this matterwill now be settled under Resolution Process. As "Resolution Plan" submitted by"Resolution Applicant" was approved by Committee of Creditors (COC) of whichthese Bondholders are also a part and the same is submitted to Adjudicating AuthorityNCLT for final approval.

Changes to Share Capital:

At present the Authorized Share Capital of the Company stands at Rs. 110 crores and thepaid-up capital stand at Rs. 34.04 crores there has been no change in the share capitalduring the period ended 31st March 2021.

Consolidated Financial Statements:

As required under the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and as per provisions of Companies Act 2013 a consolidated financialstatement of the Company and all its subsidiaries is attached. The consolidated financialstatement has been prepared in accordance with the relevant accounting standards asprescribed under Section 129 133 of the Companies Act 2013 and as per Schedule III ofthe Companies Act 2013. The consolidated financial statement discloses the assetsliabilities income expenses and other details of the Company and its subsidiaries.

The annual accounts of the subsidiary companies will also be kept for inspection by anyinvestor at its Head Office in Hyderabad and that of the subsidiary companies concerned. Agist of the financial performance of the subsidiary Companies is contained in the report.

Dividend:

In the absence of profit your Company is unable to declare any dividend for thefinancial year 2020-2021.

Subsidiary Companies:

Your Company has two subsidiary companies viz. Bartronics Asia Pte. Limited andBartronics Middle East FZE and Three step down subsidiary companies viz. BartronicsHongkong Ltd Veneta Holdings Ltd and Burbank Holdings Ltd.

Bartronics Asia Pte Limited:

The Company was incorporated as a wholly owned subsidiary of Bartronics India Limitedon 14th June 2007 in the Republic of Singapore with a Share Capital of US $ 769500.Bartronics Asia Pte Limited (BAPL) acquired the only issued share of Cason Limited onDecember 21 2007; subsequently the name of the Company was change to Bartronics Hong KongLimited with effect from 15th October 2008. In the month of April 2011 BAPL acquired theonly share of Veneta Holdings Limited Mauritius making it its wholly owned subsidiary.BAPL had incorporated another subsidiary in Mauritius named Burbank Holdings Limited.

Bartron ics Middle East Fze:

Bartronics Middle East FZE Sharjah UAE was incorporated on June 22 2010 as a whollyowned subsidiary of Bartronics India Limited with a share capital of AED 150000 Shares.

A separate statement containing the salient features of the Financial Statement for thefinancial year ended 31st March 2021 of the aforesaid Subsidiary Companies are includedin the Annual Report as Form AOC-1 as an Annexure -I.

Particulars of Loans Guarantees and Investments:

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

Contracts and Arrangements with Related Parties:

All contracts/arrangements/transactions entered by the Company during the financialyear with related parties were in ordinary course of business and on arm's length basis.During the year the Company had not entered into any contract/arrangement/ transactionwith related parties which could be considered material under Regulation 23 of ListingRegulation. Accordingly the disclosure of Related Party Transactions as required nderSection 134(3) (h) of the Companies Act 2013 in Form AOC - 2 is not applicable. ThePolicy on materiality of

related party transactions and dealing with related party transactions as approved bythe Board.

Details of Contracts and arrangements with related parties under section 188 of theCompanies Act 2013 are given in the notes to the Financial Statements.

Prior omnibus approval is obtained on an annual basis for the transactions with relatedparties which are of a foreseeable and repetitive nature. The transactions entered intopursuant to the omnibus approval so granted and a statement giving details of alltransactions with related parties are placed before the Audit Committee and Board ofDirectors for their review on a periodic basis.

None of the Directors other than to the extent of their shareholding receipt ofremuneration /commission has any pecuniary relationships or transactions vis-a-vis theComp any.

II. Business Outlook:

Your company started with proving solutions based on barcode has emerged as leadingplayer in the country to provide solutions using umbrella of AIDC technologies. Yourcompany also has state of the art manufacturing facility with the capacity to manufacture80mn smart cards per annum. Using these two synergies the company could successfullyventure into Financial Inclusion projects driven by Reserve Bank of India popularly knownas "Jan Dhan Yojana". The exposure to government driven projects give yourcompany revenue visibility and we expect this momentum to continue in the domestic marketsgiven the un-deterred Government's focus.

Management Discussion and Analysis Report:

In terms of regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Management Discussion and Analysis report on your Company'sperformance industry trends and other material changes with respect to your Company andits subsidiaries wherever applicable is attached hereto as Annexure VIII and forms a partof this Report. The MD&A report provides a consolidated perspective of economicsocial and environmental aspects material to our strategy and our ability to create andsustain value to our key stakeholders and includes aspects of reporting as required byRegulation 34 of the Listing Regulations with Stock Exchange on Business ResponsibilityReport.

III. Governance and Ethics:

Corporate Governance:

Your Company believes in adopting best practices of corporate governance. A soundCorporate Governance is critical to enhance and retain stakeholders' trust. CorporateGovernance principles forms core values of the Company. These guiding principles are alsoarticulated through the Company's code of conduct corporate governance guidelinescommittees and disclosure policy.

A separate section on corporate governance practices followed by your Company togetherwith a certificate from Mr. Y. Ravi Prasada Reddy Practicing Company SecretaryProprietor of RPR & Associates (CP No. 5360) on compliance with corporate governancenorms under Regulation 34(3) read with Schedule V of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is forms part of the report on corporategovernance.

Board of Directors and Key Managerial Personnel:

The Board of Directors got suspended vide NCLT order dated December 02 2019 andpursuant to Section 17 of the IBC the powers of the Board of Directors of the Companystood suspended and such powers are vested with the Interim Resolution Professional Mr.Chinnam Poorna Chandra Rao (IP Registration No.IBBI/IPA- 003/IPA-000119-18/2017-2018/11298). His appointment was subsequently confirmed by the Committee of Creditors(‘COC') as the Resolution Professional (the ‘RP'). Accordingly Mr. ChinnamPoorna Chandra Rao in his capacity as RP took control and custody of the management andoperations of the Company from 05th December 2019.

The Board (Suspended) comprises of Non-Executive Directors of which one is IndependentDirector.

In accordance with the Articles of Association of the Company Mr. A. B. Satyavas Reddyis liable to retire by rotation and being eligible offer himself for reappointment. TheResolutions proposing their re- appointment/ appointments as Directors will be placedbefore the Shareholders for their approval at the ensuing Annual General Meeting of theCompany with sole purpose of complying with applicable provisions.

For Directors seeking appointment/re-appointment in the forthcoming Annual GeneralMeeting of the Company; the particulars as required to be disclosed in accordance withRegulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 forms part of this Report.

Ms. Gaddam Varshitha is Director (Independent-NonExecutive).

Mr. K. Udai Sagar ceased to be a Managing Director and Director of the Company w.e.f.13th November 2019. And also for the fact that the Company is under CIRP

there is no KMP in the Company.

The Company has received declarations from all the Independent Directors of the Companyconfirming that they continue to meet with the criteria of independence as prescribedunder sub-section (6) of Section 149 of the Companies Act 2013 and under Regulation16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

None of the Directors of your Company is disqualified under Section 164 (2) of theCompanies Act 2013. As required by law this position is also reflected in the Auditors'.

Committees of the Board

Subsequent to the initiation of the CIRP against the company w.e.f 2nd December 2019the Audit Committee Nomination and Remuneration Committee Stakeholders' RelationshipCommittee and Risk Management Committee of the Board of Directors could not beconstituted. Role and responsibilities of the above said committees shall be fulfilled bythe Resolution Professional as per the provision to Regulation 15(2B) of the SEBI (LODR)Regulations 2015.

Number of Meetings of the Board:

The Board could not have the meetings as the Board got suspended by the order of theHon'ble NCLT.

Meetings of the Resolution Professional:

After taking over the management and company operations the Resolution Professionalmet 5(Five) times during the financial year 2020-21 on 26th June 2020 14th September2020 12th November 2020 04th December 2020 and 12th February 2021.

Meetings of Committee of Creditors:

After taking over the management and company operations the Committee of Creditors(COC) have met

10 (Ten) times during the financial year 2020-21 on 29th July 2020 13th August 202018th August 2020 25th August 2020 11th September 2020 17th September 2020 17thDecember 2020 (Adjourned to 19 th December 2020) 20th January 2021 25th January2021 08th February 2021 (Adjourned to 10th February 2021).

Board Evaluation:

The Board of Directors evaluated the annual performance of the Board as a whole itscommittee's and the directors individually in accordance with the provisions of theCompanies Act 2013 and Listing Regulations in the following manner:

• Structured evaluation forms after taking into consideration inputs receivedfrom the Directors covering various aspects of the Board's functioning such as adequacyof the composition of the Board and its Committees Board culture execution andperformance of specific duties obligations and governance for evaluation of theperformance of the Board its Committee's and each director were circulated to all themembers of the Board along with the Agenda Papers.

• The members of the Board were requested to evaluate by filling the evaluationforms and the duly filled in evaluation forms were required to be sent to the CompanySecretary in a sealed envelope or personally submitted to the Chairman at the concernedmeeting.

• The Board also provided an individual feedback to the concerned director onareas of improvement if any.

A separate meeting of Independent Directors to evaluate the performance evaluation ofthe Chairman the NonIndependent Directors the Board and flow of information frommanagement could not be held as the Board of Directors got suspended by the order of theHon'ble NCLT.

Related Party Transactions

As a part of its philosophy of adhering to highest ethical standards transparency andaccountability your Company has historically adopted the practice of undertaking relatedparty transactions only in the ordinary and normal course of business and at arm's length.In line with the provisions of the Companies Act 2013 and the Listing Regulations theBoard has approved a policy on related party transactions.

All Related Party Transactions are placed on a quarterly basis before the AuditCommittee and also before the Board for approval. Prior omnibus approval of the AuditRisk Committee is obtained for the transactions which are of a foreseeable and repetitivenature.

There are no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large. The requisite details ofthe related party transactions entered into during the financial year are provided in Annexure-IIincluded in this report.

Vigil Mechanism:

In line with the requirements under Section 177(9) and (10) of the Companies Act 2013and regulation 22 of the Listing Regulations your Company has established vigil mechanismby framing a Whistle Blower Policy to deal with instance of fraud and mismanagement ifany. The Vigil Mechanism framework ensures that strict confidentiality is maintainedwhilst dealing with concerns and also that no discrimination shall be meted out to anyperson for a genuinely raised concern. The designated officer/ Audit Committee Chairmancan be directly contacted to report any suspected or confirmed incident of fraud/misconduct.

Directors' Responsibility Statement:

Directors' Responsibility Statement as required under the provisions of Section 134(5)of the Companies Act 2013 is given in the Annexure-III attached hereto and formspart of this Report.

Particulars of Employees

Information required pursuant to Section 197 (12) of the Companies Act 2013 read withRule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014is provided along with a statement containing inter alia names of employees employedthroughout the financial year and in receipt of remuneration of Rs. 102 lakhs or moreemployees employed for part of the year and in receipt of Rs. 80.50 lakhs or more permonth pursuant to Rule 5(2) the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is provided as Annexure-IV to this report.

VI. Internal Financial Controls and Audit:

Internal Financial Controls and their Adequacy:

The Board of your Company has laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and operatingeffectively. Your Company has adopted policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.

Risk Management:

The Risk Management policy of your Company is focused on ensuring that risks are knownand addressed. The Board of Directors on recommendation of the Audit Committeeestablished a robust Risk Management framework by framing a Risk Management Policy to dealwith all risks including possible instances of fraud and mismanagement if any. The RiskManagement Policy details the Company's objectives and principles of Risk Management alongwith an overview of the Risk Management process procedures and related roles andresponsibilities.

The Board is of the opinion that there are no elements of risks that may threaten theexistence of the Company. The board periodically tracks the progress of implementation ofthe Risk Management policy.

Statutory Auditors:

M/s. N. G. Rao & Associates (Membership No. 207300) Chartered AccountantsHyderabad (FRN: 009399S) were appointed as Statutory Auditors of the Company for a term of5 years in the 26th AGM.

Auditors' Report

There are no qualifications reservations or adverse remarks made by M/s N. G. Rao& Associates Chartered Accountants Statutory Auditors in their report for thefinancial year ended 31st March 2021.

Pursuant to provisions of section 143(12) of the Companies Act 2013 the StatutoryAuditors have not reported any incident of fraud to the Audit Risk and ComplianceCommittee during the year under review.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Y. Ravi Prasada Reddy Practicing Company Secretary Proprietor of RPR &Associates (CP No. 5360) to conduct Secretarial Audit of the Company.

The Report of the Secretarial Audit in Form MR-3 for the financial year ended 31stMarch 2021 is enclosed at Annexure-V to the Report. There are some qualificationsreservations or adverse remarks made by the Secretarial Auditor in his report.

Presently the Company is under CIRP. Once this process is successfully completedCompany will address appointment of Company Secretary Chief Financial

Officer and any other remarks mentioned in the report.

V. Other Disclosures:

Particulars of Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo:

Particulars with respect to Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo as required under Section 134 of the Companies Act 2013 readwith the Companies (Accounts) Rules 2014 are given in the Annexure-VI attachedhereto and forms part of this Report.

Extract of Annual Return:

Pursuant to section 92(3) and section 134(3)(a) extract of the Annual Return as on31st March 2021 in form MGT- 9 is enclosed as Annexure-VII to this report.

Material Changes and Commitments Affecting the Financial Position of the Company:

There have been no material changes and commitments affecting the financial positionof the Company which occurred during the end of the financial year to which the financialstatements relate and the date of this report.

Insurance:

All the properties and insurable assets of the Company including Building Plant andMachinery stocks etc. wherever necessary and to the extent required have beenadequately the covered.

Details of Significant and Material Orders Passed by the regulators/Courts/TribunalsImpacting the Going Concern Status and the Company's Operations in Future:

There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations.

Sexual Harassment Policy:

The Company as required under the provisions of "The Sexual Harassment of Women atWorkplace (Prohibition Prevention and Redressal) Act 2013" has framed a Policy onProhibition Prevention and Redressal of Sexual Harassment of Women at Workplace andmatters connected therewith or incidental thereto.

In the year under review the Company has not received any complaint under the saidPolicy.

Environment and Social Obligation:

The Company's plants comply with all norms set up for clean and better environment bythe competent authorities. The Company undertakes regular checks

/ inspections including certification for the maintenance of the environment. TheCompany values environmental protection and safety as the major considerations in itsfunctioning. The Company has adequate effluent Treatment Plants to prevent pollution. TheCompany is continuously endeavoring to improve the health and quality of life in thecommunities surrounding its industrial complexes.

Human Resource Management:

The Company believes that Human Resource is its most valuable resource which has to benurtured well and equipped to meet the challenges posed by the dynamics of BusinessDevelopments. The Company has a policy of continuous training of its employees bothin-house. The staff is highly motivated due to good work culture training remunerationpackages and the values which the company maintains. Your Directors would like to placeon record their deep appreciation of all employees for rendering quality services and toevery constituent of the Company be its customers shareholders regulatory agencies orcreditors. Industrial relations have remained harmonious throughout the year.

Acknowledgements and Appreciation:

Your Directors take this opportunity to thank the customers shareholders suppliersbankers business partners/ associates financial institutions and Central and StateGovernments for their consistent support cooperation and encouragement to the Company.

Resolution Professional wishes to express its appreciation to all the employees of theCompany for their outstanding contribution to the successful operations of the Company.

BY ORDER OF THE BOARD
Mr. Ch. Poorna Chandra Rao
Resolution Professional
(A Company under Corporate Insolvency
Resolution Process by NCLT order No.
CP (IB) No. 375/7/HDB/2019)
Place: Hyderabad
Date: September 01 2021.

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