Your Directors have pleasure in presenting the 31st Annual Report together with theAudited Accounts for the year ended 31st March 2018.
| || ||Rupees in lakhs |
|PARTICULARS ||2017-2018 ||2016-2017 |
|REVENUE FROM OPERATIONS ||100137.75 ||94777.38 |
|OTHER INCOME ||120.90 ||148.21 |
|PROFIT BEFORE FINANCIAL CHARGES & DEPRECIATION ||6581.48 ||3839.45 |
|LESS: FINANCE COSTS ||320.38 ||447.12 |
|PROFIT BEFORE DEPRECIATION & TAXATION ||6261.10 ||3392.33 |
|LESS: || || |
|A) DEPRECIATION ||1911.08 ||1710.34 |
|B) PROVISION FOR TAXATION || || |
|- CURRENT TAX(NET OF MAT CREDIT ENTITLEMENT) ||1542.02 ||425.20 |
|- DEFERRED TAX ||(61.34) ||112.53 |
|- ADJUSTMENT OF TAX RELATING TO EARLIER YEARS ||47.83 ||(73.05) |
|NET PROFIT AFTER TAX ||2821.51 ||1217.31 |
|ADD: OTHER COMPREHENSIVE INCOME NET OF TAXES ||(19.21) ||(7.59) |
|TOTAL COMPREHENSIVE INCOME FOR THE YEAR ||2802.30 ||1209.72 |
|TRANSFER TO GENERAL RESERVE ||- ||- |
|BALANCE CARRIED FORWARD TO BALANCE SHEET ||2802.30 ||1209.72 |
FINANCIAL HIGHLIGHTS AND OPERATIONS
The revenue from operations and other income for the financial year under review wasRs. 100258.65 lakhs as against Rs 94925.59 lakhs for the previous financial year i.e.an increase by 5.62%.The profit before finance costs depreciation and taxation isRs.6581.48 lakhs for the financial year under review as against Rs 3839.45 lakhs for theprevious financial year i.e. increase by 71.42%. The profit after tax increased to Rs.2821.51 lakhs as compared to Rs. 1217.31 lakhs for the previous financial year i.e.increase by 131.78%. Total comprehensive income for the year increased to Rs. 2802.30lakhs as compared to Rs. 1209.72 lakhs for the previous financial year i.e. increase by131.65%. This is mainly due to increase in volumes and other cost saving measures taken bythe Company.
To achieve vision mission and business objectives we are practicing TPM which is aproven world class practice and we had experienced the benefits of the same methodology.
We have started TPM activity first time in year 1999 at Gurugram Plant under the ableguidance of Yamaguchi san and mentoring of our Chairman and Managing Director Mr. RohitRelan and learnt numerous new tools and techniques and achieved positive results and BSLGurugram plant was awarded with Excellence Award in 2006 by JIPM (Japan Institute of PlantMaintenance).
Now Bharat Seats Limited (BSL) at Group Level has started TPM activity under the ableguidance of Kuramitsu san(TPM Consultant from JMAC Japan) and mentoring of our CMD Mr.Rohit Relan. We launched the same in July 2017 with total Management commitment. NowGurugram Plant has started activity for Second Level Award which is Consistence inExcellence and Manesar Bhorakalan and TRIM plants are going for Excellence Award in 2020.
To achieve the said objective and award all manufacturing locations of BSL havestarted working for model machine (one each in each plant) achieved significantimprovements and results in terms of PQCDSME (Productivity Quality Cost DeliverySafety Morale and Environment).
TPM kick-off happened in February 2018 in the presence of esteemed guest from ourvaluable customer (MSIL) our Key Suppliers Mr. Rohit Relan CMD and BSL Team and Pillars.Now we are in the expansion phase to implement TPM Activity at all manufacturing locationswith emphasis on Kaizen Autonomous Maintenance Focused Improvements and otherImprovement project activities and actions initiated as per the guidelines of Kuramitsusan.
TRANSFER TO GENERAL RESERVE
During the F.Y 2017-18 the Company has not transferred any amount to General Reserve.
Your Directors are pleased to recommend for the approval of the shareholders at the 31stAnnual General Meeting a dividend of 50% (Re 1/- per equity share) for the financial yearended 31.03.2018 . The dividend shall be subject to tax on dividend to be paid by theCompany.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
a. The members of the Company are informed that the dividends that remainunpaid/unclaimed for a period of 7 (seven) years from the date of transfer to theUnpaid/Unclaimed dividend account are required to be transferred to the Investor Education& Protection Fund (IEPF) Authority established by the Central Government.
Accordingly during the financial year under review the Company has transferredUnpaid/Unclaimed dividend amounting to Rs.165740 lying with the Company for a period ofseven years pertaining to the financial year ended on March 31st 2010.
b. The members of the Company are also informed that as per the new provisionsintroduced in the year 2016 underlying equity shares on which dividend remainUnpaid/Unclaimed for a period of 7 (seven) consecutive years are required to betransferred to the Investor Education & Protection Fund (IEPF) Authority establishedby the Central Government.
Accordingly during the financial year under review the Company has transferred thefollowing shares to IEPF Authority:
(i) 40827 equity shares in respect of which dividend have not been claimed by themembers for seven consecutive years pertaining to the financial year ended on Marh 312010 upto financial year 2016.
There is no change in the capital structure of the Company.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business during the financial year 2017-2018 underreview.
AWARDS AND RECOGNITION
During the year your Company has been awarded:
1. Certificate for Yield Improvement
2. Shield for Overall Performance at Vendor Conference of Maruti Suzuki India Limitedheld in Singapore.
Your Company has been awarded:
- a certificate for Fire Safety at Vendor Conference of Maruti Suzuki India Limitedheld in May 2018; and
- a shield for cost reduction from Suzuki Motor Cycle India Private Limited.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion And Analysis as stipulated under Regulation 34 of the SEBI(Listing Obligations And Disclosure Requirements) Regulations 2015 is presented in aseparate section forming part of the Annual Report.
ICRA has assigned its Short Term credit rating of A2+ and Long term Credit rating ofA- indicating the outlook on the long term rating as 'Stable'.
RELATED PARTY TRANSACTIONS
All contracts/transactions entered into by the Company during the financial year withrelated parties were in the ordinary course of business and on arm's length basis.
The Related Party Transactions Policy as approved by the Board is uploaded on theCompany's website at the web link: http://www.bharatseats.com/investors/Policy on RelatedParty Transactions.
The information relating to particulars of contracts or arrangements with relatedparties referred to in sub section (1) of section 188 of the Companies Act 2013 in FormAOC-2 is annexed as Annexure I forming part of this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The information relating to conservation of energy technology absorption foreignexchange earnings and outgo pursuant to Section 134(3)( m) of the Companies Act 2013 readwith Rule 8(3) of Companies(Accounts) Rules 2014 is annexed hereto as Annexure IIforming part of this Report.
BOARD ANNUAL EVALUATION
In compliance with the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and guidance note dt. 5th January 2017performance evaluation was carried out of the Board its Committees and individualDirectors including the Chairman of the Board.
Nomination & Remuneration Committee reviewed the evaluation criteria for the Boardits Committees Executive and non-executive Directors and Chairman of the Companyconsidering qualification expertise attributes and various parameters based on whichevaluation of the Board has to be carried out by the Company.
A separate meeting of the independent directors was convened which reviewed theperformance of the Board (as a whole) Committees of the Board the nonindependentdirectors and the Chairman.
The evaluation of Independent Directors was carried out by the Board.
This exercise was carried out through structured evaluation process covering variousaspects of the Board such as composition of the Board/Committees experiencecompetencies performance of specific duties etc. Separate exercise was carried out toevaluate the performance of individual directors including Board Chairman who wereevaluated on the parameters such as attendance contribution at the meeting independentjudgment etc. and was found to be satisfactory.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review Mr. T.J. Chacko Director (Operations) ceased to beDirector of the company due to expiry of his tenure as Whole time Director w.e.f.30.11.2017.
In accordance with the Articles of Association of the Company and relevant provisionsof the Companies Act 2013 Mr. Toshiya Miki (DIN: 07505339) retire by rotation at theensuing Annual General Meeting.
The Board recommends his re-appointment.
The Company has received declaration from all the Independent Directors confirming thatthey meet the criteria of Independence as prescribed under Section 149(6) of the CompaniesAct 2013 read with the schedules and rules made there under as well as SEBI(ListingObligations And Disclosure Requirements) Regulations 2015.
KEY MANAGERIAL PERSONNEL (KMP)
Mr. Rohit Relan Chairman and Managing Director Mr. Sanjeev Kumar CFO and Ms. RituBakshi Company Secretary continue to be the KMPs of the Company in terms of Section 203of the Companies Act 2013 read with the Companies (Appointment & Remuneration ofManagerial Personnel) Rules 2014.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements as set out by the Regulators/applicablelaws.
The report on Corporate Governance as stipulated under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 been included in this Annual Report as aseparate section along with the Auditors' Certificate.
DETAILS OF DEPOSIT AS PROVIDED UNDER CHAPTER V OF THE COMPANIES ACT 2013
Your Company has not accepted any deposits under Chapter V of the Companies Act 2013.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGISTRARS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIALSTATEMENTS
The Directors had laid down internal financial controls to be followed by the Companyand such policies and procedures adopted by the Company for ensuring the orderly andefficient conduct of its business including adherence to 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 information. The Audit Committee evaluates the internal financialcontrol system periodically.
The Equity shares of the Company are listed at Bombay Stock Exchange. The Company haspaid listing fees due to the Stock Exchange.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The CSR Policy recommended by the Audit Committee and approved by the Board isuploaded on the Company's website at the web link:http://www.bharatseats.com/investors/Corporate Social responsibility Policy
The Corporate Social Responsibility Report as provided in Companies (Corporate SocialResponsibility Policy) Rules 2014 and there was no unspent amount during the financialyear. The detail is annexed hereto as Annexure III.
EXTRACT OF ANNUAL RETURN
Pursuant to sub section (3) of Section 92 and Sub section (3)(a) of Section 134 of theCompanies Act 2013 read with Rule 12 of Companies (Management And Administration) Rules2014 the extract of Annual return as on 31st March 2018 is annexed hereto as AnnexureIV.
MEETINGS OF THE BOARD
Four meetings of the Board of Directors were held during the financial year. Forfurther details please refer the Report on Corporate Governance to this Annual Report.
The Audit Committee comprises of Independent Nonexecutive Directors namely Mr. G.N.Mehra Chairman Mr. PK. Lahiri and Mr. Ravindra Gupta.
Powers and Role of the Audit Committee are included in the Corporate Governance Report.All the recommendations made by the Audit Committee were accepted by the Board.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act 2013 the Directors confirm that :
(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed and no material departures have been made from the same.
(b) Appropriate accounting policies have been selected and applied consistently andjudgments and estimates made that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at 31st March 2018 and of the Profit or Lossof the Company for the year ending 31st March 2018;
(c) Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) The annual accounts have been prepared on a going concern basis.
(e) Internal financial controls to be followed by the Company have been laid down andthat such internal financial controls are adequate and were operating effectively.
(f) Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
PARTICULARS OF EMPLOYEES
Disclosure as required under Sub Rule 2 of Rule 5 of Companies (Appointment AndRemuneration of Managerial Personnel) Rules 2014 is annexed hereto as Annexure V.
The ratio of the remuneration of each Director to the median employees' remunerationand others detail in terms of Sub Section 12 of Section 197 of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed as part of the report to Annexure VI.
COMPANY'S POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FORDETERMINING QUALIFICATIONS POSITIVE ATTRIBUTES INDEPENDENCE OF A DIRECTOR AND OTHERMATTERS AS PROVIDED UNDER SUB SECTION(3) OF SECTION OF THE COMPANIES ACT 2013
The Company has formulated a Nomination and Remuneration Policy which annexed as partof the report as Annexure VII. Other details are provided in Corporate Governance Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
There was no transaction falling under the provision of Section 186 during thefinancial year under review.
The Company has in place the Risk Management Policy to identify and assess the key riskareas and monitor the same.
The Board periodically reviews the risks and suggests steps to be taken to control therisks.
The Company has in place an established Whistle Blower Policy. The Audit Committee andthe Board periodically reviews the policy and its implementation. The purpose of thispolicy is to provide a framework to promote responsible whistle blowing by employees.
The Whistle Blower Policy may be accessed at the Company's website at web link:http://www. bharatseats. com/investors/policies/Whistle Blower Policy.pdf
Our relations with the employees are very cordial. Your Directors would like to placeon record their appreciation of the commitment and efficient services rendered by allemployees of the Company without whose wholehearted efforts the overall satisfactoryperformance of the Company would not have been possible
AUDITORS AND AUDITORS' REPORT
(a) Statutory Auditors
The shareholders of the Company at last AGM held on September 21 2017 appointed M/sS.R. Batliboi & Co. LLP Chartered Accountants LLP (ICAI Firm Registration No.301003E/E300005 as the Statutory Auditors of the Company for an initial term of 5 yearssubject to ratification by members at every Annual General Meeting if required under theprovisions of the Companies Act 2013. However the Companies Amendment Act 2013 hasdeleted the condition of ratification of statutory auditors and accordingly they holdtheir office till the conclusion of Annual General Meeting to be held in 2022.
The Auditors' Report given by M/s S.R. Batliboi & Co. LLP Statutory Auditors onthe financial statements of the Company for the year ended March 31 2018 is part of theAnnual Report. The Auditors' Report does not contain any qualification reservation oradverse remark. During the year under review the Auditors had not reported any matterunder Section 143 (12) of the Act therefore no detail is required to be disclosed underSection 134 (3)(ca) of the Act.
(b) Secretarial Auditors
In accordance with the provisions of the Section 204 read with the Companies(Appointment And Remuneration of Managerial personnel) Rules 2014 the Secretarial Auditwas carried out by Mr. R S Bhatia Practising Company Secretary for the Financial year:2017-18. The report of Secretarial Auditor for the financial year 2017-18 is annexedherewith marked as Annexure VIII to this Report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
SAFETY FIRST is what the Company preaches and practise. It is an oath. With the regularguidance from safety team of MSIL today Bharat Seats Limited (BSL) is among the topcompanies which has made safe work practices its culture.
Installation of Aerosol Fire Detection and Suppression System at all manufacturinglocations for special Hazard Fire Protection is in itself a unique approach pioneered andinstalled by BSL.
Besides this the environmentally friendly practices fire extinguishers of MAP 90%thermography test adherence to NBC 2016 NOC from fire office and regular third partyinspections speaks of the commitment.
The review mechanism monitoring and mock drills happen periodically and is carried outnone other than by the CMD Mr. Rohit Relan. SHE (Safety Health and Environment) trainingis imparted to all employees at all levels.
EFFECIVE MANAGEMENT SYSTEMS
The Company is system certified for IATF (International Automotive Task Force) 16949for quality ISO 14001 for Environment and OHSAS for Occupational Health and Safety.
OHSAS is internationally recognized model for occupational Health and Safety Assessmentseries for Management Systems. The Company focuses to control all the risks involved inall the functions across the company even before they could happen.
Our Chairman and Managing Director Mr. Rohit Relan focus on effective mitigation ofall the likely risks involved has led to all employees feeling a safe and healthy workingenvironment thus resulting them in performing at their optimum level of competence.
The Company is committed to the protection of environment and is not involved in anytype of activity hazardous to environment. It strictly adheres to the provisions ofenvironmental laws. There is no trade effluent generated by the Company which may causepollution. Our Company is an ISO14001 certified company.
DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementof the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013.
The following is the summary of the complaints received and disposed off during thefinancial year: 2017-18:
a) No. of complaints received: NIL
b) No. of Complaints disposed off: NIL
a. Buy Back Of Securities
The Company has not bought back any of its securities during the year under review.
b. Sweat Equity
The Company has not issued any Sweat Equity Shares during the year under review.
c. Bonus Shares
No Bonus Shares were issued during the year under review.
d. Issue of Shares with Differential Rights
The Company has not issued any Shares with differential rights during the year underreview.
e. Issue of Shares under Employee Stock Option Scheme
No such issue of shares under employee stock option scheme was made.
f. Issue of Shares through Private Placement- Nil
g. Issue of Equity Shares without Differential Voting Rights- Nil
The Directors place on record their deep appreciation of the valuable assistance andco-operation extended to the Company by Suzuki Motor Corporation Japan Maruti SuzukiIndia Ltd. Suzuki Motorcycle India Private Limited Toyo Seat Co. Ltd. Japan HouwaKogyo Co Ltd. Japan Inoac Corporation Japan State Bank of India Bank of Tokyo-Mitsubishi UFJ Ltd. Yes Bank Ltd. HDFC Bank Ltd. IDBI Bank Ltd. various departments ofCentral Government and Haryana State Government. The directors convey their deepappreciation to each and every employee for her/his efficient service commitment andcollective team work.
Your support as shareholders is greatly valued.
Your Directors thank you and look forward to the future with confidence.
| ||For and on behalf of the Board |
| ||Bharat Seats Limited |
|Place : Gurugram ||(Rohit Relan) |
|Dated : 10.8.2018 ||Chairman and Managing Director |