The Directors present the 83rd Annual Report along with the Audited FinancialStatements of the Company for the year ended 31st March 2019.
1. Summarised Financial Results are given below
|Particulars ||For the Year Ended 31st March2019 ||For the Year Ended 31st March 2018 |
| ||(Rs. in Lakhs) |
|Revenue from Operation (incl.excise duty) ||4976.55 ||4310.94 |
|Other Income ||8.19 ||7.05 |
|Profit/(Loss) before Depreciation ||24.96 ||(591.38) |
|Profit/(Loss) after Depreciation ||(636.15) ||(1276.75) |
|Extraordinary Income / Loss (-) ||2962.12 ||113.55 |
|Net Profit/(Loss) after tax ||2325.96 ||(1163.20) |
2. Company Performance
During the year the operations have increased by 15% over the previous year. Thecommercial vehicle market in India was stable during the year which helped us achieve thisgrowth. The effect of continous improvement and cost reduction enabled the companyto curtail the cash loss situation. During the year the debts due to Asset ReconstructionCompany India Limited (ARCIL) was settled in full . A large portion of the dues toEdelweiss Asset Reconstruction Company Limited has been settled during the year. Thebalance will be settled shortly. The net profit after tax is the net surplus fromsettlement of debt under one time settlement.
The company maintains its quality of all its products and continues to be a preferredsupplier to the customers.
The Directors have not recommended any dividend for the year under report due to lossincurred.
During the year under review the Company has settled the dues to Asset ReconstructionCompany India Ltd.With this major portion of the debts have been settled. A smallportion of the dues to Edelweiss Asset Reconstruction company has to settled . Once thisamount is settled the company will become debt free company in respect of all bankBorrowings.
5. CORPORATE MATTERS
5.01 Human Resources
El Forge has always been a people driven Company and its employees remain its most valuableasset.
Our employees have always extended full cooperation and support during good as well asdifficult times and have unstintingly put their best effects to deliver on all ourcommitments.
The Human Resources practices at your Company empowers the employees through greaterknowledge opportunity responsibility accountability and reward. Emphasis is laid onidentifying & nurturing talent. Continuous improvement techniques are followed forbetterment of the skills in the organisation by implementing TQM & other trainingprograms and there exists an excellent system of assessment of the employees based on thesound HR practices.
During the year under review there were 163 employees on the rolls of the company.
5.02 Key Managerial Personnel
Mr.K.V.Ramachandran Vice Chairman & Managing Director Mrs.R.Sowmithri ED(Finance) & Secretary and Mr.V.Srinivasan who was appointed the CFO of the Companywithin the meaning of Section 2(18) of the Companies Act 2013 hold the office of KeyManagerial Personnel. There were no resignations in Key Management Personnel during theyear.
6. Corporate Governance
With reference to Corporate Governance the Company has complied with all possible requirementsof the guidelines as laid out in Clause 49 of the Listing Agreement. Annexure A containsreport on corporate governance enclosed here with.
At present the Company has six directors of which two are Executive Directors and fourare non executive.
7. Internal Control System and their adequacy
The Company has adequate system of internal control with reference to the financial aswell as non-fi -nancial operations. All the transactions are properly authorised recordedand reported by the Management. The Company is following all the applicable AccountingStandards for properly maintaining the books of accounts and reporting financialstatements. The Company ensures proper and adequate systems and procedures commensuratewith its size and nature of its business even though there is no internal auditor duringthe year under report.
8. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andOutgo
Information as per Section 134(3)(m) of the CompaniesAct 2013 read with the Companies(Accounts) Rules 2014 relating to Conservation of Energy technology absorption andforeign exchange earnings and outgo for the financial year 2018-19 are annexed as AnnexureB which forms part of this Report.
9. Management Discussion and Analysis
Management Discussion and Analysis report for the year under report as stipulated underClause 49 of the Listing Agreement in respect of the Stock Exchanges in India is enclosedherewith (please refer
10. Research & Development
R&D in El Forge is a continuous process. All efforts in product design and processdevelopment are directed at Customer's satisfaction competitiveness quality andresponsiveness. This includes focus on material wastage reduction by improvement intechnology and equipment with major emphasis at the Tool Room for value engineered diedesign and manufacture. Simultaneous efforts are made at the shop floorto improvemanufacturing efficiency to sustain the development efforts. Annexure B to this reportcontains the details thereof.
11. Industrial Relations
Employees at all levels have contributed to the performance of the Company. Yourdirectors place on record the co-operation of employees received during the year underreport. The Directors also place on record the unstinted cooperation extended by the staffmembers during the period under review.
12. Fixed Deposits
The Company has not accepted (or renewed) any fixed deposits during the year underreport. The deposits are being repaid to the deposit holders as and when the depositholders send their Fixed Deposit Receipts issued to them claiming their refund. As on 31stMarch 2019 the outstanding deposits amount to Rs.84.95 lakhs.
13. Applicability of Section 197(12) of Companies Act 2013 read with Rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014
None of the employees come within the purview of Section 197(12) of the Companies Act2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014. Accordingly no disclosure has been made in the above regard.
14. Directors Responsibility Statement
Pursuant to Section 134 (5) of the Companies Act 2013 the Board of Directors of the
Company hereby states and confirms that
a) In the preparation of Annual Accounts the applicable accounting standards had beenfollowed.
b) The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31st March2019 and of the Profitor Loss of the Company for that year.
c) The Directors had 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.
d) The Directors had prepared the Annual accounts on a going concern basis
e) That proper internal financial controls were followed by the Company and that suchinternal financial controls was adequate and were operating effectively.
f) That proper systems to ensure compliance with the provisions of all applicable lawswere in place and that such systems were adequate and operating effectively.
15. Remuneration Policy of the Company
The remuneration policy of the Company comprising the appointment and remuneration ofthe Directors Key Managerial Personnel and Senior Executives of the Company includingcriteria of determining qualifications positive attributes independence of a directorand other related matters have been provided in the Corporate Governance report which isattached herewith.
16. Extract of the Annual Return:
Extract of the Annual Return in the present form is enclosed herewith in Annexure F.
17. Secretarial Audit
Pursuant to provisions of Section 204 of the Companies Act 2013 read with Rule 9 ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany engaged the Services of Mrs.B.Venkatalakshmi Company Secretary in Practice toconduct the Secretarial Audit of the Company for the financial year ended 31st March2019.
The Secretarial Audit report (in Form MR-3) is attached as Annexure to this Report.Please refer An-nexure G in this report.
18. Related Party Transactions
All transaction entered by the Company with Related Parties were in the ordinary courseof business and at Arm's Length pricing basis. The Audit Committee granted omnibusapproval for the transaction (which are repetitive in nature) and the same was reviewed bythe Audit Committee and the Board of
Directors. There were no materially significant transactions with Related Partiesduring the financial year 2018-19 which were in conflict with the interest of the CompanySuitable disclosures as required under AS 18 have been made in Item No.16 of Note No.3.02of financial statements. Accordingly there are no transactions that are required to bereported in Form AOC-2 and accordingly AOC-2 has not been attached.
19. Corporate Social Responsibility
Our company does not fall under the criteria laid for Corporate Social Responsibilityunder section 135 of the Companies Act2013 and hence the section is not applicable to theCompany for the year under report.
20. Particulars of Loans Guarantees or Investments
Your Company has not made any loan or given any Guarantees or made any investmentduring the year under Section 186 of the Companies Act 2013
21. Vigil Mechanism / Whistle Blower Policy
Pursuant to Section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies(Meetings of Board and its powers) Rule 2014 and Clause 49 of the Listing Agreement theBoard of Directors had approved the policy on Vigil Mechanism/Whistle Blower and the sameis hosted on the Website of the Company. The policy inter-alia provides a direct access tothe Chairman of the Audit Committee.
Your Company hereby affirms that no Director/employee has been denied
Chairman of the Audit Committee and that no complaints were received during the year.
22. Statutory Auditors
The Statutory Auditors M/s L.Mukundan & Associates Chartered Accountants (Firm RegistrationNo.010283S) have been appointed last year to continue for a term of three years from theconclusion of this AGM. Their appointment resolution forms part of the agenda of thenotice of the 83rd AGM.
23.Explanation to Auditor's remark
Ther are no qualifications reservations or adverse remarks or disclaimers made by theStatutory Auditors and Company Secretary in practice in their Reports respectively. TheStatutory Auditors have drawn attention to some points under " Emphasis ofMatters " which are dealt with in the notes on accounts.
24. Material changes
There has been no material changes affecting the financial position of the companybetween 31st
March2019 till the date of the report.
25.Prohibition and redressal of sexual harrasment of women at work place
Pursuant to the new legislation " Prevention Prohibition of and Redressal ofSexual Harrassment of Women at Work place Act2013" the company has framed a policyon prevention of sexual harrasment at work place. There were no cases reported during theyear under review under the policy.
The Company places on record the co-operation of Bankers Bank of Baroda Indus Ind Banka Asset Reconstruction companies -Asset Reconstruction Company(India) Ltd and EdelweissAsset Reconstruction Company Ltd. We also thank all our Customers Suppliers Employeesand others connected with the business for their co-operation. We sincerely thank theshareholders for their support.
For and on behalf of the Board of Directors
Place : Chennai