To the members
The Board of Directors present the Fifty Second Annual Report of the Company alongwith the financial the financial year ended 31 March 2019.
1. Financial summary
The financial summary and performance highlights of the Company
| || |
(Amount Rs. In Lakhs)
|Financial Results ||Financial year || |
|Particular ||2018-19 ||2017-18 |
|Total revenue ||65149.93 ||58524.45 |
|Less: Total Expenditure excluding Depreciation ||59821.45 ||53533.73 |
|Profit before Depreciation andtax ||5328.48 ||4990.72 |
|Less: Depreciation ||1181.95 ||1048.23 |
|Add: Exceptional items ||(2.69) ||- |
|Profit Beforetax ||4143.84 ||3942.49 |
|Less: Current Tax ||(133.27) ||(1150.56) |
|Deferred Tax ||483.56 ||(180.17) |
|Earlier year Tax ||- ||(26.78) |
|Net profit aftertax ||4494.13 ||2584.98 |
Considered necessary. Previousyear's
2. Financial and operational performance
During the year under review your Company's revenue from operations was Rs. 63729.85Lakhs. Further in the Financial Year ended 31 March 2019 the profit before tax (PBT)was Rs. 4143.84 Lakhs as against Rs. 3942.49 Lakhs in the previous year and profit aftertax (PAT) was Rs. 4494.13 Lakhs against Rs. 2584.98 Lakhs in the previous financialyear.
The Company has adopted adequate cost control measures throughout the year and hasbeen aggressive in its quest for new business. This helped to deliver a decent revenuegrowth. Your Company continuestofocuson broaden its customer base and to set a benchmarkin the competitive market. With stable government at centre the long term outlook ofcable industry is expected to be favorable driven by Power Sector Reforms Modernizationof Railways new Metro Railways and other Infrastructures Developmental Projects.
3. Material changes and commitments IF Any affecting the financial position of thecompany WHICH have occurred between the end of the financial year of the company to WHICHthe financial statements relate and the date of the report and details of significant andmaterial orders passed By the regulators or courts or tribunals mpacting the going concernstatus and I company's operations In future
Board of Directors of the Company are pleased to inform you that the Scheme ofAmalgamation between CMI Energy India Private Limited (Transferor Company) and CMI Limited(Transferee Company) has been approved by the Hon'ble National Company Law Tribunal(NCLT) Principal Bench New Delhi vide its order dated April 03 2019 with appointed dateMarch 01 2016 under sections 230 to 232 of the Companies Act 2013 read with Companies(Compromises Arrangements and Amalgamations) Rules 2016 and other applicableprovisions if any.
After approval of the above Scheme of Amalgamation all the property rights powersliabilities of CMI Energy India Private Limited be transferred without further act ordeed to CMI Limited and accordingly the same shall pursuant to section 232 of theCompanies Act 2013 be transferred to and become the Assets and Liabilities of the CMI
The Registrar of Companies (ROC) has also approved the amalgamationof CMI energyindiaPrivate Limited servicing into CMI Limited on May 13 2019.
4. Share capital
Authorised Share Capital of the Company as on 31 March 2019 was Rs. 250000000/-(Rupees Twenty Five Crore Only) divided into 15027457 (One Crore Fifty lakhs TwentySeven Thousand Four Hundred Fifty Seven) equity shares of Rs 10/- (Rupees Ten) each.
Pursuant to the implementation of the Scheme of Amalgamation between CMI Energy IndiaPrivate Limited (Transferor Company) and CMI Limited (Transferee Company) as approved bythe Hon'ble National Company Law Tribunal (NCLT) Principal Bench New Delhi vide itsorder dated 3rd April 2019 effective from 01st March 2016 the authorised share capitalof the Transferor Company has been added to and forms part of the authorised share capitalof the Transferee Company. Accordingly the authorised share capital of the TransfereeCompany stands increased to the extent of the aggregate authorised share capital of theTransferor Company i.e. Rs. 1750000000 (Rupees One Hundred and Seventy Five Crores)divided into 175000000 (Seventeen Crore Fifty Lakhs) Equity shares of Rs 10/- (RupeesTen) each.
Clause V of the Memorandum of Association and relevant article(s) of the Articles ofAssociationof the Transferee Company stands modified to give the aforesaid increase in theauthorised capital of the Transferee Company pursuant to the order of Hon'ble NationalCompany Law Tribunal (NCLT) Principal Bench New Delhi.
" The authorised Share Capital of the Company is Rs. 1750000000 (Rupees OneHundred Seventy Five Crore only) divided into 175000000 (Seventeen Crore Fifty Lakhsonly) Equity Share of Rs. 10/- (Rupees Ten) each with power to increase or reduce thecapital of the Company and to divide the shares in the capital for the timebeing intoseveral classes and to attach thereto respectively such preferential deferred qualifiedconditions as may determined by or in accordance withthearticlesassociationof the Companyand vary modify amalgamate or abrogate any such right privilege or condition in suchmanner as may for the time being be provided by the Articles of Association of theCompany."
5. Credit rating
During the year under review the Company has improved its long term credit ratingPositive. The BBB+ awarded by CRISIL moderate degree of safety regarding timely offinancial obligation. The Company's credit rating has also improved to CRISIL A2 byCRISIL reflecting moderate degree of safety regarding timely payment of financial CARE has reaffirmed the rating CARE BBB+ (Triple B Plus) / stable to the Long term bankfacilitiesand CARE A3+ (A Three Plus) to the short term bank facilities.
6. Dividend and reserves
Based on the Company's performance the Directors are pleased to recommend payment ofdividend on equity shares @ Re. 1/- per equity share (10%) for the financialyear 2018-19(previous year Rs 1/- per share). The dividend on equity shares if approved by memberswould involve payout of Rs 181.16 Lakhs including dividend distribution tax.
7. Public deposits
The Company has not accepted or renewed any fixed deposits during the period underreview. It has not accepted any deposits from the public within the meaning of theprovisions of Section 73 of the Companies Act 2013 and Rules made thereunder. Thereforeit is not required to furnish information respect of outstanding deposits undernon-banking non-financial Companies (Reserve Bank) Directions 1966 and Companies(Accounts) Rules 2014.
8. Subsidiaries joint ventures or associate companies
As on 31 March 2019 the Company has a wholly owned subsidiary i.e. CMI Energy IndiaPrivate Limited. However pursuant to the order passed by Hon'ble NCLT dated 03 April2019 CMI Energy India Private Limited amalgamated with the Company and ceases to be theSubsidiary of the Company. Therefore disclosure in Form AOC-1 in terms of Section 129(3)of the Act isnot required.
Special Further during the year under review CMI Agro Limited right privileges orceased to be the step down subsidiary of the Company.
9. Nternal financial controls I
The Board / Management believes that based on the knowledge/ informationgained by themabout affairs of the Company from records the Company has effective internal financialcontrol systems and policies and such controls are operating effectively.
The internal control systems include documented policies checks and balancesguidelines and procedures that are supplemented by robust internalto CRISIL BBB+/ auditprocesses and monitored continuously through periodical reviews by management to providereasonable assurance that all assets are safeguarded; and all transactions entered into bycompany are authorized recorded and reported properly. Post-amalgamation theBoard/Management is in the process reviewing the internal controls framework of theCompany with an objective to have a robust internal control framework commensurate withthe size scale and nature of business of the Company.
10. Directors and Key managerial personnel (Kmp)
Change in Directorship:
During the year under review there is no change in the composition of Board ofDirectors of the Company.
As on March 31 2019 the Company has 6 Directors 196 with an Executive Chairman whichincludes 2 Executive Directors 4 Non-executive Independent Directors inclusive of 1 WomanDirector. The Board consists of following members:
|Sl. No. ||Name of Director ||Din ||Designation |
|1 ||Mr. Amit Jain ||00041300 ||Chairman Cum Managing Director |
|2 ||Mr. Vijay Kumar Gupta ||00995523 ||Whole-Time Director |
|3 ||Mr. Pyare Lal Khanna ||02237272 ||Non-Executive Independent Director |
|4 ||Mr. Kishor Punamchand Ostwal ||00460257 ||Non-Executive Independent Director |
|5 ||Mr. Manoj Bishan Mittal ||00282676 ||Non-Executive Independent Director |
|6 ||Ms. Archana Bansal ||01129623 ||Non-Executive Independent Director |
However Executive Ms. Archana Bansal Non-Independent Director resigned for thedirectorship of the Company on 28 May 2019.
Further the Board of Directors on recommendation of the Nomination and RemunerationCommittee appointed Ms. Charu Jain as an additional director in the category ofNon-Executive Director in accordance with Section149(4) of the Act with effect from 28May 2019 to hold office for a term of 5 (five) consecutive years. In terms of officeSection up to the date of ensuing Annual General Meeting.
The Nomination & Remuneration Committee of the Board hereby recommends theresolutionin relation executive Independent Director for the the members of the Company.Brief profile Charu Jain has been given in the Notice convening the Annual GeneralMeeting.
In accordance with the provisions of Section 152 of the Act and the Company'sArticlesof Association Mr. Vijay Kumar Gupta Whole Time Director retires by rotation atthe forthcoming Annual General Meeting and being eligible offers himself forre-appointment. The Board and Nomination & Remuneration Committee recommend hisre-appointment for the considerationof the Members of the Company at the forthcomingAnnual General Meeting.
Mr. Vijay Kumar Gupta whole time director of the Company will attain the age of 70(Seventy) years on 15 December 2019. Pursuant to Section read with relevant rules ofCompanies Act 2013 no company shall continue the employment of any person as whole-timedirector if he/she has attained the age of seventy years. However the appointment of aperson who has attained the age of seventy years may be made by passing a specialresolution in which case the explanatory statement annexed to the for notice for suchmotion continuation of Mr. Vijay Kumar Gupta as Whole Time Director.
Directors liable to retire by rotation
Mr. Vijay Kumar Gupta is liable to retire by rotation at the ensuing Annual GeneralMeeting and being eligible offers himself for reappointment.
None of the Directors are disqualified under the provisions of the Companies Act 2013.
Key managerial personnel
During the year under review in terms of the provisions of Section 2(51) and 203 ofthe Companies Act 2013 the Key Managerial Personnel (KMP) of the Company were as under:-
1. Mr. Amit Jain Chairman Cum Managing Director
2. Mr. Vijay Kumar Gupta- Whole Time Director
3. Mr. Rattanlal Aggarwal Chief Financial Officer
4. Mr. Subodh Kumar Barnwal Company Secretary
Changes in Key managerial personnel
There is no change in the Key Managerial Personnel (KMP) of the Company in terms of theprovisions of Section 2(51) and 203 of the Companies Act 2013
11. Director's responsibility statement
Pursuant to Sub-section Companies Act 2013 with respect to the Director'sResponsibility Statement it is here by confirmed
I. In the preparation of the Annual Accounts for the year ended 31 March 2019 theapplicable accounting standards read with requirements set out under Schedule III of theAct have been followed and no material departures have been made from the same;
Ii. Appropriate Accounting Policies have been selected and applied consistently andhave made judgments and estimates that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at 31 March 2018 and of theprofit of the Company for that year ended on that date except to the extent mentioned innotes to accounts;
Iii. Proper and maintenance of adequate accounting accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing irregularities;
Iv. The Annual Accounts have been prepared on a going concern basis;
V. The internal financial controls to be followed by the Company had been laid down andthat such internal financial operating effectively;
Vi. The proper systems had been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
12. Board perormance evaluation
The Company has devised a Policy for performance evaluation of Independent DirectorsBoard Committees and other individual Directors which include criteria for performanceevaluation Non-Executive Directors and Executive Directors.
Pursuant to the provisions of the Act the Board has carried out an annual evaluationof its own performance the individual Directors (including the Chairman) as well as anevaluation of of all Board Committees. The Board of Directors was assisted by theNomination Committee. Some of the performance indicators experience based on whichevaluation expertise knowledge and skills required for achieving strategy and forimplementation of best governance practices which ultimately contributes to the growth(5)ofsection134ofthe of the Company in compliances with all policies of that: the Company.
13. Number of meetings of the board of Directors
During the year under review 10 (Ten) Board Meetings were duly convened and held. Thedetails of the number of meetings of the Board held during the Financial Year 2018-19forms part of the Corporate Governance Report.
14. Committees of the board
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration
3. Stakeholders' Relationship
4. Corporate Social Responsibility Committee. Records in The details of the Committeesalong with their composition and detecting fraud and other and attendance of members atthe meetings provided in the Corporate Governance Report which forms part of this AnnualReport. Further during the year review the board has accepted all the recommendations ofthe Audit Committee.
15. Statement on declaration By independent directors controls are adequate andwere Your Company has received the necessary declaration from each Independent Directorthat he/she meets the criteria of Independence as laid out in Section 149(6) of theCompanies Act 2013 read with the Schedules rules made thereunder and Regulation 25 ofSEBI Listing Regulations 2015
16. Nomination and remuneration policy
The Board of Directors has framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior of Management of theCompany.
The Policy broadly lays down the guiding principles philosophy and the basis forpayment of remuneration to Executive and Non-executive Directors (by way fees andcommission) Key Managerial the working sitting of Personnel Senior Management and otheremployees. The policy also provides the criteria for determining qualificationsattributes and Independence of Director and criteria for appointment of Key ManagerialPersonnel / Senior Management and performance evaluationwhich are considered by theNomination and Remuneration Committee and the Board of Directors while making selection ofthe candidates. The above policy has been posted on the website of the Company at http://www.Cmilimited.in/img/pdf/nomination%20and%20 Remuneration%20policy.pdf
17. Vigil mechanism Cum whistle blower policy
The Company has a vigil mechanism named Vigil Mechanism Cum Whistle Blower Policyframed by Board of the Company to deal with instances of fraud and mismanagement if any.Details of the same are given in the Corporate Governance Report.
The same has also been displayed on the website of the Company viz: - http://www.cmilimited.in/img/pdf/Vigil%20mechnism%20plocy-%20Whistle%20 Blower%20policy.pdf
18. Related party transactions
All transactions entered with Related Partiesfor the year under review were on arm'slength basis and thus a disclosure in Form AOC-2 in terms of Section 134 of the Act is notrequired. Further there are no material related party transactions during the year underreview as definedunder SEBI (listingobligations and Disclosure Requirements) Regulations2015 and adopted by the Board of Directors in the Related Party Transactions Policy of theCompany. All related party transactions are mentioned in the notes to the accounts. TheCompany has developed a framework through Standard Operating Procedures for the purpose ofidentification and monitoring of such Related Party Transactions
All Related Party Transactions are placed before the Audit Committee for approval.Omnibus approval was obtained on a yearly basis for transactions which are of repetitivenature. Transactions entered into pursuant to omnibus approval are verifiedand details ofall Related Party Transactions are placed before the Audit Committee and the Board forreview and approval on a quarterly basis.
The Policy on Related Party Transactionsas approved by the Board of Directors has beenuploaded on the website of the Company and can be seen at the link http://www.cmilimited.in/img/pdf/policy_on_Related_party_transactions.pdf. None of the Directors has any pecuniary relationshipthe Company except remuneration.
19. Corporate social responsibility
In compliance with Section 135 of the Act 2013 read with Companies (Corporate SocialResponsibility Policy) Rules 2014 as amended the Board of the Company has formedCorporate Social Responsibility ("CSR")
Committee of meetings terms of reference and attendance of members at the meetings areprovided in the Corporate Governance Report. The policy on CSR as approved by the Board ofDirectors is also uploaded on the website of the Company i.e. Http://www.Cmilimited.in/img/pdf/Corporate%20Social%20 Responsibility%20policy.pdf.
Pursuant to Section read with CSR policy of the Company it is required to spend twopercent of the average net profit of the Company for three immediately preceedingfinancial activities as required years.annualreportoncsr under the Companies (CorporateSocial Responsibility Policy) Rules 2014 as amended have been annexed as Annexure -1and forms integral part of this Report.
A) Statutory Auditor
M/s Krishna Neeraj & Associates Chartered Accountants (Firm RegistrationNo.023233N) were appointed as Statutory Auditors of the Company for a period of five theat the Annual General Meeting (AGM) of the Members held on 28 September 2016 on aremuneration mutually agreed upon by the Board of Directors and the Statutory Auditors.Ation ratific Their appointment was subject to by the Members at every subsequent AGM heldafter the AGM held on 28 September 2016.
Pursuant to the amendments made to Section 139 of the Companies Act 2013 by theCompanies (Amendment) Act 2017 effective from 7 May 2018 the requirement of seekingratification of the Members for the appointment of the Statutory Auditors has beenwithdrawn from the Statute. Hence the resolution seeking ratificationof the Members forcontinuance of their appointment at this AGM is not being sought.
There is no audit qualificationreservation or or transactionsvis-a-vis adverse remarkfor the year under review.
B) Secretarial Auditor
Pursuant to provision of Section 204 of the Companies Act 2013 and Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directorshas appointed M/s Pooja Anand & Associates Practicing Company Secretaries forconducting Secretarial Audit of the Company for the financial year 2018-19.
The Secretarial Audit Report for FY2018-19 as submitted by Secretarial Auditor in FormMR-3 is annexed as Annexure-2.
There is no secretarial audit qualification for year under review.
C) Cost Auditor
In terms of Section148 of the Act the Company is required to maintain cost records andhave the audit of its cost records conducted by a cost accountant. Cost records are madeand maintained by the Company as required under Section 148(1) of the Act. The Board ofDirectors at its meeting held on 30 May 2018 appointed M/s Ajay Kumar Singh & Co(Firm Registration Number 000386) Cost Auditors to conduct the Cost Audit for theFinancial Year 2018-2019.
For the financial year ending 31 March 2020 the Board of Directors of the Companyhas on ee Committ therecommendationoftheaudit approved the appointment of M/s Ajay KumarSingh & Co as the cost auditors of the Company. M/s Ajay Kumar Singh & Co CostAccountants have vast experience in the field of cost audit.
In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of theCompanies (Audit and Auditors) Rules 2014 the remuneration payable to the cost auditorsas recommended by the Audit Committee and approved by the Board has to be ratified by themembers of the Company.
Accordingly an appropriate resolution proposed remuneration of Rs. 45000 per annumplus applicable taxes and out-of-pocket expenses payable to the cost auditors for theFinancial Year ending 31 March 2020 forms part of the notice of ensuing Annual GeneralMeeting for
21. Other information
A) Details in respect of frauds reported by Auditors other than those which arereportable to the Central Government
The Statutory Auditors Secretarial Auditors Cost Auditors or Internal Auditors of theCompany have not reported any frauds to the Audit Committee or to the Board of Directorsunder Section 143(12) of the Companies including rules made thereunder.
The Company does not have any Scheme of Stock Option for its employees Directors etc.
C) Disclosure under Section 43(a)(iii) and Section 54(1)(d) of the Companies Act2013
During the year under review the Company has not issued any shares with differentialvoting rights and sweat equity shares and hence no information as required under SectionSection 54(1)(d) of the Companies with applicable rules is required to be disclosed.
D) Risk management
The Board/ management is reviewing the Risk management framework of the Company. TheCompany would put in place a suitable enterprise risk management framework for identifyingand evaluating risks and opportunities that may have bearing on the organization.Recognises that these risks need to be managed and mitigated to protect the shareholdersand other stakeholders interest.
E) Conservation energy technology Absorption and Foreign exchange earnings andoutgo
In accordance with Section 134(3)(m) Companies Act 2013 read with the Rule 8(3) forthe of the Companies (Accounts) Rules 2014 as amended the information on conservationof energy technology absorptionand foreign exchange earnings and outgo are annexed as Annexure- 3 hereto and forms an integral part of this Report.
F) particulars ofemployees and Related Disclosures
Disclosures pertaining to remuneration and other details of the employees as requiredunder Section 197(12) of the Companies Act 2013 read with Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended areannexed to this report as
G) extract of Annual Return
The details forming part of the extract of the Annual Return in Form MGT-9 as requiredunder Section integral part of this Report and is available on the Company's website http://www.cmilimited.in/img/pdf/extract%2of%20Annual%20Report.pdf and annexed to this report as Annexure 5
H) Management Discussion & Analysis Report
The Management Discussion and Analysis Report on the operations of thecompany asrequired under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 (hereinafter referred to as "Listing in a separate sectionand forms an integralpart of this Report.
I) particulars ofloans Guarantees or Investments under Section 186
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the note no 9 & 10 to the FinancialStatements.
J) Corporate Governance Report
The Company has complied with requirements of Regulation 34 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. A report on the CorporateGovernance practices followed by the Company together with a certificate from thePracticing Company Secretary regarding compliance are given as an Annexure 7 tothis report.
K) Cost Records
As per the requirement of Central Government and pursuant to provisions of Section 148of the Companies Act 2013 read with Companies (Audit and Auditors) Rules 2014 as amendedfrom time to time audit of cost records of the Company is being carried out. The Board ofDirectors on recommendation of Audit Committee has appointed M/s Ajay Kumar Singh &Co. Cost Accountants as Cost Auditor to audit the cost records and accounts relating tocable manufacturing for the financial ending 31 March 2020. As per the requirement of theaforesaid section a resolutionratifying remuneration payable to Cost Auditors forms partof the Noticeconvening the 52nd Annual General Meeting.
Your Company has maintained cost records and 92 oftheactwhichformsan accounts as perSection148 (1) of the Companies Act 2013. Further the Cost Audit Report along withannexure for FY2018-19 was approved by board of Directors on 31 October 2018.
L) Disclosure under the Sexual Harassment of Women at Work place(preventionprohibition and Redressal) Act 2013.
The Company has laid down Anti Sexual Harassment policy on Gender Equality GenderProtection Preventionof Sexual Harassment and Redressal System in line with therequirements ofregulations")isprovided the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. An Internal Complaints Committee (ICC)has been set up to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary Apprenticeship) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed offduring the year under review-
No. Of complaints received: Nil
No. Of complaints disposed of: NA
m) Secretarial Standards
The Company has in place proper systems to ensure compliance with the provisions of theapplicable secretarial standards issued by the Institute of Company Secretaries of Indiaand such systems are adequate and operating effectively.
22. Cautionary note
Certain Statements in the Management Discussion and Analysis' section may beforward-looking and are stated as required by applicable laws and regulations. Manyfactors may affect the actual results which would be different from what the Directorsenvisage in terms of the future performance and outlook. Investors are cautioned that thisdiscussion contains forward looking Statement that involve risks and uncertaintiesincluding but not limited to risks inherent in the Company's growth strategy dependenceon certain businesses dependence on availability of qualified other factors discussed.The discussion and analysis should be read in conjunction with the Company's financialstatements and notes on accounts.
The Directors wish to place on record their gratitude to the Authorities BanksBusiness Associates and Shareholders for their unstinted support assistanceandco-operation.The Directors place on record their and trained manpower and deepappreciation to employees at all levels for their hard work dedication and commitment.
| ||By order of the Board |
| ||For cmi limited |
| ||Amit Jain |
|Place: new Delhi ||Chairman Cum managing Director |
|Date: 13 August 2019 ||Din: 00041300 |