The Members of
Eimco Elecon (India) Limited
The Directors take pleasure in presenting the 48th Annual Report togetherwith the Audited Financial Statements for the Financial Year ended on 31stMarch 2022.
1. HIGHLIGHTS OF PERFORMANCE
Total Revenue for the year decreased to Rs 9362.14 Lakh as compared to Rs 13746.15Lakh in the previous year. Profit Before Tax for the year was Rs 987.70 Lakh as comparedto Rs1427.01 Lakh in the previous year. Profit After Tax for the year was Rs 851.95 Lakhas compared to Rs1125.70 Lakh in the previous year.
2. FINANCIAL RESULTS
(Rs in Lakh)
|Particulars ||Standalone ||Consolidated |
| ||31-03-2022 ||31-03-2021 ||31-03-2022 ||31-03-2021 |
|Revenue from Operations ||8444.37 ||12613.10 ||8444.37 ||12613.10 |
|Other Income ||917.77 ||1133.05 ||917.77 ||1133.05 |
|Total Income from Operations ||9362.14 ||13746.15 ||9362.14 ||13746.15 |
|Profit Before Tax ||987.70 ||1427.01 ||987.70 ||1427.01 |
|Tax Expenses ||135.75 ||301.31 ||135.75 ||301.31 |
|Share in Profit of Associates ||- ||- ||15.84 ||1.80 |
|Profit for the Year ||851.95 ||1125.70 ||851.95 ||1127.50 |
|Other Comprehensive Income ||(26.49) ||(1.09) ||(26.49) ||(1.09) |
|Total Comprehensive Income for the year ||825.46 ||1124.61 ||841.30 ||1126.41 |
|Equity Reserves ||32386.53 ||31849.49 ||32707.19 ||32154.31 |
Your directors recommend for your consideration a dividend of 25% i.e. Rs 2.5/- pershare on 5768385 equity shares of Rs10/- each for the year ended on 31stMarch 2022 (Previous Year Rs5/- per share on 5768385 equity shares of Rs10/- each).Dividend is subject to approval of members at the ensuing Annual General Meeting (AGM) andshall be subject to deduction of income tax at source.
The Dividend Distribution Policy is available on the Company's websitewww.eimcoelecon.in.
During the year the unclaimed dividend pertaining to the Financial Year 2013-14 hasbeen transferred to the Investor Education & Protection Fund.
4. TRANSFER TO RESERVES
The Board of Directors has decided to retain the entire amount of profit for theFinancial Year 2021-22 in the Statement of Profit & Loss.
5. SUBSIDIARY JOINT VENTURE AND ASSOCIATE COMPANIES
The Company has neither subsidiary nor Joint Venture Company.
Associate Company :
Eimco Elecon Electricals Limited Your Company holds 47.62% of the Equity Shares ofEimco Elecon Electricals Limited. The profit of the Associate for the Financial Year endedon 31st March 2022 was Rs 15.84 Lakh as against profit of Rs3.77 Lakh for theprevious year.
Consolidated Financial Statements
The Consolidated Financial Statements of the Company are prepared in accordance withthe relevant Indian Accounting Standards as per the Companies (Indian AccountingStandards) Rules 2015 as amended by the Companies (Accounting Standards) Rules 2016notified under Section 133 of the Companies Act 2013 and form an integral part of thisReport. Pursuant to Section 129(3) of the Companies Act 2013 read with Rule 5 of theCompanies (Accounts) Rules 2014 a statement containing salient features of the financialstatements of Subsidiaries/ Associate Companies/ Joint Ventures is given in Form AOC-1which forms an integral part of this Report.
6. SHARE CAPITAL
The paid up Equity Share Capital as on 31st March 2022 was Rs576.84 Lakh.During the year under review the Company has neither issued shares with differentialvoting rights nor granted stock options or sweat equity.
The Company continues to focus on judicious management of its working capital.Receivables Inventories and other working capital parameters were kept under strict checkthrough continuous monitoring. The whole of the properties of the Company have beensuitably insured.
8. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part of the financial statements provided in this Annual Report.
9. FIXED DEPOSITS
The Company has not accepted any deposit from public falling within the ambit ofSection 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits)Rules 2014. There are no unpaid / unclaimed deposits as on 31st March 2022.
Director Retiring by Rotation
Shri Mukulnarayan Dwivedi retires by rotation at the forthcoming Annual General Meetingof the Company and being eligible offers himself for re-appointment. The Boardrecommends his appointment for your approval.
Re-appointment of Executive Directors
The Company had sought the approval of the shareholders by way of an OrdinaryResolution through notice of postal ballot dated 27th October 2021 forre-appointment and remuneration of Shri Prayasvin B. Patel as an Executive Director whichwas duly passed and the results of which were announced on 1st January 2022.Shri Dineshkumar G. Bhimani (Membership No. FCS 8064) of D. G. Bhimani & AssociatesPractising Company Secretaries was appointed as the Scrutinizer to scrutinize the postalballot process only by voting through electronic means (remote e-voting) in a fair andtransparent manner.
The term of appointment of Shri Mukulnarayan Dwivedi Executive Director of the Companywill be completed on 09th September 2022. The Board Meeting dated 29thApril 2022 approves his reappointment and remuneration for the term of three years witheffect from 10th September 2022 subject to the approval of the shareholders atthis Annual General Meeting.
The Independent Directors met on 21st March 2022 without the attendance ofNon-Independent Directors and members of the management. The Independent Directorsreviewed the performance of NonIndependent Directors and Board as a whole and assessed thequality quantity and timeliness of flow of information between the Company Management andthe Board that is necessary for the Board to effectively and reasonably perform theirduties.
Statutory Declarations / Disclosures by Directors:-
All Independent Directors of the Company have given declarations to the Company underSection 149 (7) of the Companies Act 2013 that they meet the criteria of independence asprovided in Section 149(6) of the Companies Act 2013 and Regulation 16(1)(b) ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015.
None of the Director of your Company is disqualified as per the provisions of Section164(2) of the Companies Act 2013. Your Directors have made necessary disclosures asrequired under provisions of the Companies Act 2013 and the SEBI (LODR) Regulations2015.
11. DIRECTORS' RESPONSIBILITY STATEMENT
Based on the frame work of internal financial controls and compliance systemsestablished and maintained by the Company the work performed by the internal statutorycost and secretarial auditors and the reviews performed by the Management and the relevantBoard Committees including the Audit Committee the Board is of the opinion that theCompany's internal financial controls were adequate and effective during the year ended on31st March 2022. Accordingly pursuant to Section 134(5) of the Companies Act2013 based on the above and the representations received from the Operating Managementthe Board of Directors to the best of their knowledge and ability confirm that:
(i) In the preparation of the annual accounts the applicable accounting standards havebeen followed and that there were no material departures therefrom;
(ii) They have in the selection of the accounting policies consulted the statutoryauditors and have applied their recommendations consistently and made judgments andestimates that are reasonable and prudent so as to give a true and fair view of the stateof affairs of the Company as at 31st March 2022 and of the profit of theCompany for the year ended on that date;
(iii) They have taken proper and sufficient care 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;
(iv) They have prepared the annual accounts on a going concern basis;
(v) They have laid internal financial controls to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively during theyear ended on 31st March 2022; and
(vi) Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively during theyear ended on 31st March 2022.
12. KEY MANAGERIAL PERSONNEL (KMP)
During the year under review Shri N. D. Shelat ceased to be CFO and KMP of the Companyw.e.f. 30th September 2021. Shri Vishal C. Begwani was appointed as CFO andKMP of the Company w.e.f. 1st October 2021.
As on 31st March 2022 Shri Mukulnarayan Dwivedi Executive Director; ShriVishal C. Begwani Chief Financial Officer and Shri Rikenkumar Dalwadi Company Secretaryare designated as KMP of the Company.
13. COMMITTEES OF THE BOARD
The Board of Directors have the following Committees:
a. Audit Committee
b. Nomination and Remuneration Committee
c. Stakeholders' Relationship Committee
d. Corporate Social Responsibility Committee.
The details of the Committees along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.
14. BOARD EVALUATION
Pursuant to the provisions of the Companies Act 2013 and Regulation 17 of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 and notifications/ circulars of SEBI the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of its Committees. The manner in which the evaluation hasbeen carried out has been explained in the Corporate Governance Report.
15. REMUNERATION POLICY
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management Personneland their remuneration. The weblink of the policy is https://eimcoelecon.in/wp-content/uploads/2020/06/THE- NOMINATION-AND-REMUNERATION-POLICY.pdf.
16. NUMBER OF MEETINGS OF THE BOARD
During the year under review the Board met 4 times. The meeting details are providedin the Corporate Governance Report that forms part of this Annual Report. The maximumintervals between any two meetings are as prescribed under the Companies Act 2013.
17. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of the Company's business.
All Related Party Transactions are placed before the Audit Committee and the Board forapproval. Prior approval of the Audit Committee is obtained for the transactions which areof a foreseen and repetitive nature and in the ordinary course of the Company's business.Transactions with related parties are disclosed in the notes to accounts to the financialstatements.
The policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website. The weblink of the policy ishttps://eimcoelecon.in/wp-content/uploads/2022/05/ EIMCO-ELECON RPT-Policv.pdf.
18. CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES
As part of its initiatives under the Corporate Social Responsibility (CSR) the Companyhas undertaken projects in the area of education and health care. These projects are inaccordance with Schedule VII of the Companies Act 2013 and the Company's CSR policy. TheAnnual Report on CSR activities is annexed herewith as Annexure A'.
19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant material orders have been passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
20. MANAGEMENT'S DISCUSSION AND ANALYSIS
A detailed review of the operations performance and future outlook of the Company isgiven in the Management's Discussion and Analysis appearing as Annexure B' tothis Report.
21. INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company has an effective internal control and risk-mitigation systems which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's internal control system is commensurate with its size scale and complexities ofits operations. The internal and operational audit is entrusted to Messrs C.F. Patel &Co. Chartered Accountants. The main thrust of internal audit is to test and reviewcontrols appraisal of risks and business processes besides benchmarking controls withbest practices in the industry.
The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Company has a robust Management Information System which is an integral part ofthe control mechanism.
The Audit Committee of the Board of Directors the Statutory Auditors and the BusinessHeads are periodically apprised of the internal audit findings and corrective actions aretaken by the Management. Audit plays a key role in providing assurance to the Board ofDirectors. Significant audit observations and corrective actions taken by the Managementare presented to the Audit Committee of the Board. To maintain its objectivity andindependence the Internal Audit function reports to the Chairman of the Audit Committee.
22. VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company has established Vigil Mechanism system and framed Whistle Blower Policy.Whistle Blower Policy is disclosed on the website of the Company atfollowingweb-link-https://eimcoelecon. in/wp-content/uploads/2021/06/The-Whistle-Blower-Policv 2021-06-03.pdf.
23. CORPORATE GOVERNANCE
Your Company has always striven to incorporate appropriate standards for good CorporateGovernance. It has taken adequate steps to ensure that the provisions of CorporateGovernance as prescribed under the Companies Act 2013 and the SEBI (LODR) Regulations2015 are complied with. A detailed report on Corporate Governance is appearing as AnnexureC' to this Report along with the Auditors' Certificate on its compliance by theCompany.
24. PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 of the Companies Act 2013 read withRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 in respect of employees of the Company are set out in the Annexure D' tothe Board's Report.
25. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING ANDOUTGO
The information on conservation of energy technology of absorption and foreignexchange earning and outgo stipulated under Section 134(3) (m) of the Companies Act 2013read with Rule 8 of the Companies (Accounts) Rules 2014 is given in Annexure E'forming part of this report.
26. STATUTORY AUDITORS
Messrs Thacker Butala Desai Chartered Accountants Navsari were appointed as theStatutory Auditors of the Company for a period of 5 (five) consecutive years at the 43rdAnnual General Meeting of the Company until the conclusion of this 48th AnnualGeneral Meeting for the financial year 2021-22. Their tenure will expire at the conclusionof ensuing 48th Annual General Meeting of the Company for financial year2021-22.
The Board places on record the highest sense of appreciation for the valuable servicesrendered by them as Auditors of the Company during their association with the Company.
Your Directors have recommended the appointment of M/s. K. C. Mehta & Co.Chartered Accountants (Firm Registration No. 106237W) as the Statutory Auditors of theCompany for a period of five years from the conclusion of this 48th AnnualGeneral Meeting of the Company for the financial year 2021-22 until the conclusion of 53rdAnnual General Meeting for the financial year 2026-27 subject to the approval of theMembers at the ensuing 48th Annual General Meeting of the Company.
As per the provisions of Section 139 of the Companies Act 2013 the Company has placedthe matter relating to their appointment by the members at the Annual General Meeting.Consequent upon the expiry of term of M/s. Thacker Butala Desai M/s. K. C. Mehta &Co. shall be the Statutory Auditors of the Company. M/s. K. C. Mehta & Co. CharteredAccountants have confirmed their eligibility under Section 141 of the Companies Act 2013and the Rules framed thereunder for appointment as Statutory Auditors of the Company. Asrequired under SEBI(LODR) Regulations 2015 M/s. K. C. Mehta & Co. have alsoconfirmed that they hold a valid certificate issued by the Peer Review Board of theInstitute of Chartered Accountants of India.
There is no audit qualification reservation or adverse remark in the Auditors' Reportfor the year under review.
27. COST AUDITORS
Pursuant to Section 148 of the Companies Act 2013 read with the Companies (CostRecords and Audit) Amendment Rules 2014 the cost audit records maintained by the Companyin respect of its activity are required to be audited. Your Directors have on therecommendation of the Audit Committee appointed Messrs Y. S. Thakar & Co. CostAccountants to audit the cost accounts of the Company for the financial year ending 31stMarch 2023 on a remuneration of ' 45000/- plus taxes as applicable and out of pocketexpenses. As required under the Companies Act 2013 the remuneration payable to the CostAuditors is required to be placed before the Members in a general meeting for theirratification. Accordingly a Resolution seeking Members' ratification for the remunerationpayable to Messrs Y. S. Thakar & Co. Cost Accountants the Cost Auditors is includedat Item No. 8 of the Notice convening the Annual General Meeting.
28. SECRETARIAL AUDITORS
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 Messrs D. G. Bhimani & Associates a firm of Company Secretaries inPractice to undertake the Secretarial Audit of the Company. The Report of the SecretarialAudit carried out during the year 2021-22 is annexed herewith as Annexure F'.There is no secretarial audit qualification for the year under review.
29. EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) read with Section 134(3)(a) of the Companies Act 2013 theAnnual Return as on 31st March 2022 is available on the Company's website.
The Company takes a very pragmatic approach towards insurance. Adequate insurance coverhas been taken for all movable and immovable assets for various types of risks.
31. REPORTING OF FRAUDS
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and/or Board under Section 143(12) ofthe Companies Act 2013 and Rules framed thereunder.
32. RISK MANAGEMENT
The Company operates in a competitive environment and is generally exposed to variousrisks at different times such as technological risks business risks operational risksfinancial risks etc. The Board of Directors and Audit Committee of Directors of theCompany periodically review the Risk of the Company so that the Management controls therisk through properly defined network. The Company has a system based approach to businessrisk management backed by strong internal control systems. A range of responsibilitiesfrom strategy to the operations is specified. A strong independent internal audit functionat the corporate level carries out risk focused audits across all businesses enablingidentification of areas where risk managements processes may need to be improved.
The Board reviews internal audit findings and provides strategic guidance on internalcontrol monitors internal control environment within the Company and ensures thatInternal Audit recommendations are effectively implemented. The combination of policiesand procedures adequately addresses the various risks associated with your company'sbusinesses.
33. DISCLOSURE UNDER THE SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION 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 the Workplace (Prevention & Redressal) Act 2013.Internal Complaints Committee (ICC) has been set up to redress complaints receivedregarding sexual harassment. All employees (permanent contractual temporary trainee)are covered under the policy.
The following is a summary of sexual harassment complaints received and disposed-offduring the year 2021-22:
No. of complaints received : Nil
No. of complaints disposed off : N.A.
No. of complaints pending : Nil
The policy on Sexual Harassment at workplace is placed on the Company's website athttps:// eimcoelecon.in/wp-content/uploads/2019/04/Sexual- Harassment-Policy.pdf
34. INDUSTRIAL RELATIONS/PERSONNEL
Your Company is committed to upholding its excellent reputation in the field ofIndustrial relations. Through continuous efforts the Company invests and improvisesdevelopment programmes for its employees.
35. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
On appointment the concerned Director is issued a Letter of Appointment setting out indetail the terms of appointment duties responsibilities and expected time commitments.During the first Board Meeting attended each newly appointed Independent Director istaken through a formal induction program including the presentation from the Whole-timeDirector on the Company's manufacturing marketing finance and other important aspects.The Company Secretary briefs the Director about his/her legal and regulatoryresponsibilities as a Director. The Familiarization Programme for Independent Directorsincludes a detailed presentation by Business and Functional Heads visit to themanufacturing site etc. Weblink for the Familiarisation Programme of IndependentDirectors are available at https://eimcoelecon.in/wp-content/uploads/2022/05/Final-Femiliarization- Programme-Independent-Directors2021-22.pdf
36. MATERIAL CHANGES AND COMMITMENTS
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the Financial Year and date of thisreport.
37. COMPLIANCE OF SECRETARIAL STANDARDS The Company has complied with theapplicable Secretarial Standards as issued by the Institute of Company Secretaries ofIndia.
Your Directors are highly grateful for the unstinted guidance support and assistancereceived from the Government Bankers and Financial Institutions. Your Directors arethankful to all valuable Stakeholders of the Company viz. shareholders customersdealers vendors suppliers collaborators business associates and other agencies fortheir faith trust and confidence reposed in the Company.
Your Directors wish to place on record their sincere appreciation for the dedicatedefforts and consistent contribution made by the employees at all levels to ensure thatthe Company continues to grow and excel.
|For and on behalf of the Board of Directors || |
|Mukulnarayan Dwivedi ||Prayasvin B. Patel |
|Executive Director ||Executive Director |
|DIN : 08442155 ||DIN : 00037394 |
|Place : Vallabh Vidyanagar || |
|Date : 29th April 2022 || |