Your Directors present herewith the Twenty First Annual Report on the business andoperations of the Company together with financial statements for the financial year ended31st March 2020.
SUMMARISED STATEMENT OF PROFIT AND LOSS:
| || || || ||Rs in million |
| ||Standalone ||Consolidated |
|Particulars ||Financial Year 2019-20 ||Financial Year 2018-19 ||Financial Year 2019-20 ||Financial Year 2018-19 |
|Revenue from operations ||49385.69 ||54174.59 ||69177.07 ||75104.99 |
|Other income ||361.88 ||162.23 ||475.97 ||270.46 |
|Total income ||49747.57 ||54336.82 ||69653.04 ||75375.45 |
|Raw Material Cost ||30473.23 ||35237.29 ||37352.08 ||43494.54 |
|Employee Benefit expenses ||2961.28 ||2777.43 ||6773.25 ||6527.44 |
|Finance cost ||108.15 ||170.73 ||175.39 ||257.32 |
|Depreciation ||1992.48 ||1756.98 ||4142.83 ||3762.10 |
|Other expenses ||8528.02 ||8839.77 ||13744.03 ||13795.25 |
|Total expenditure ||44063.16 ||48782.20 ||62187.58 ||67836.65 |
|Profit before exceptional items ||5684.41 ||5554.62 ||7465.46 ||7538.80 |
|tax and minority interest || || || || |
|Exceptional Items ||- ||208.00 ||- ||208.00 |
|Profit before tax ||5684.41 ||5346.62 ||7465.46 ||7330.80 |
|Net Tax expense ||1407.49 ||1768.01 ||1810.12 ||2380.74 |
|Net profit for the year ||4276.92 ||3578.61 ||5655.34 ||4950.06 |
The Board of Directors at its meeting held on 3rd March 2020 declared aninterim dividend of Rs 5.50 per equity share of Rs 10 each (55%) for the financial year2019-20 and the same has been paid to all the eligible shareholders as on record date i.e.12th March 2020. Interim dividend paid shall be considered as final dividendfor the year ended 31st March 2020. Dividend paid in the previous year was Rs5.50 per equity share of face value of Rs 10 each (55%).
The dividend pay-out is in accordance with the Company's Dividend Distribution Policy.
Dividend Distribution Policy
This policy is effective from 26th August 2016 and has been framed andadopted in terms of Regulation 43A of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 ("Listing Regulations"). The policy inter alialays down various parameters relating to declaration/ recommendation of dividend. Therehas been no change to the policy during the financial year 2019-20. The policy is attachedas Annexure I and forms part of this Annual Report and is also placed on theCompany's website www.endurancegroup.com /investor/investor-relations.
Amount proposed to be transferred to reserves
The Company has not transferred any amount of profits to reserves.
During the year under review the Company posted a total income of Rs 49747.57 millionon a standalone basis as against Rs 54336.82 million in the previous year. The totalincome on a consolidated basis was Rs 69653.04 million compared to Rs 75375.45 millionin the previous year. The Company's total income on standalone and consolidated basisde-grew by 8.4% and 7.6% respectively. This primarily was on account of negative growthby automotive industry followed by the nationwide lockdown in March 2020 due to COVID-19pandemic. Despite a challenging market environment the Company recorded a betterthan industry' performance.
The profit after tax however increased significantly by 19.5% in the financial year2019-20 at Rs 4276.92 million as against Rs 3578.61 million in the previous year onstandalone basis; while consolidated profit after tax grew by 14.2% at Rs 5655.34 millionas against Rs 4950.06 million in the previous year. In spite of de-growth in theautomobile industry the Company earned better profit margins due to sharper focus oncosts including raw material costs and lower effective income tax rate. Further greatercontrol was exercised on our capital expenditure and working capital.
CONSOLIDATED FINANCIAL STATEMENTS:
As per Regulation 33 of the Listing Regulations and Section 129 of the Companies Act2013 ("Act") read with the rules issued thereunder consolidated financialstatements of the Company for the financial year 2019-20 have been prepared in compliancewith applicable accounting standards. The audited financial statements of the Company andits subsidiaries (including step-down subsidiaries) have been approved by the Board ofDirectors of respective entities.
During the year the Board of Directors reviewed the affairs of the subsidiarycompanies in accordance with Section 129(3) of the Act. Consolidated financial statementstogether with the statutory auditor's report thereon form part of this Annual Report.
During the year under review no new subsidiary was incorporated/ acquired nor anycompany ceased to be a subsidiary of the Company. As at 31st March 2020 theCompany had following subsidiaries:
1. Endurance Overseas Srl Italy (Direct subsidiary);
2. Endurance SpA Italy (Step down subsidiary);
3. Endurance Engineering Srl Italy (Step down subsidiary);
4. Endurance Castings SpA Italy (Step down subsidiary); and
5. Endurance Amann GmbH Germany (Direct subsidiary).
Following investments were made by overseas subsidiaries of the Company post 31stMarch 2020: a. Endurance Overseas Srl Italy (direct subsidiary of the Company) purchasedcontrolling equity stake of 99% in Adler SpA Italy and the name of the acquired entitywas changed to Endurance Adler SpA ("EA SpA"). The acquisition was for aconsideration of Euro 3.5 million with an effective date of 15th April 2020.
Adler is a leader in systems solutions for clutches gears and friction plates withniche in R&D engineering services and product development for OEM customers inEurope.
Their new product technologies / technical strength would be important for theEndurance Group. Adler has been a long term technology provider to the Company.
EA SpA has two wholly-owned subsidiaries viz. Adler RE Srl Italy and VS San MarinoSrl San Marino.
b. EA SpA acquired 100% stake in Grimeca Srl ("Grimeca") Italy on 21stMay 2020. The acquisition was completed for a consideration of Euro 2.25 million whichincluded Euro 0.9 million for the 100% stake in Grimeca and Euro 1.35 million fortechnical know-how and intellectual property rights and the "G Grimeca" brand.
Grimeca is an advanced service company involved in designing and developing new brakingproducts for motorcycle and light-vehicles including co-design' with OEM customers.Grimeca has been a technology provider for braking solutions to the Company since 2015.This strategic acquisition aims to strengthen technological prowess of the Company in thearea of braking systems.
In terms of Section 129(3) of the Act a statement in Form AOC-1 containingsalient features of the financial statements of the Company's subsidiaries forms part ofthe Annual Report. A copy of the audited financial statements of each of the subsidiarycompanies and English translation thereof will be available for inspection by anyshareholder of the Company at its registered office during business hours. These financialstatements are also placed on the Company's website atwww.endurancegroup.com/investor/investor-relations.
Details of the subsidiary companies and their performance are covered in the ManagementDiscussion and Analysis Report forming part of this Annual Report.
The paid-up equity share capital as on 31st March 2020 was
Rs 1406628480. There was no public issue rights issue bonus issue or preferentialissue etc. during the year. The Company has not issued shares with differential votingrights sweat equity shares neither has it granted any employee stock options nor issuedany convertible securities.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
There was no change in the Board of Directors and Key Managerial Personnel during theyear under review.
The composition of the Board of the Company as on 31st March 2020 is asfollows:
|Sr. No. Name of Director ||Position |
|1. Mr. Naresh Chandra ||Chairman (Non-Executive) |
|(DIN 00027696) || |
|2. Mr. Anurang Jain ||Managing Director (Executive) |
|(DIN 00291662) || |
|3. Mr. Roberto Testore ||Independent Director (Non-Executive) |
|(DIN 01935704) || |
|4. Mr. Partho Datta ||Independent Director (Non-Executive) |
|(DIN 00040345) || |
|5. Mr. Soumendra Basu ||Independent Director (Non-Executive) |
|(DIN 01125409) || |
|6. Mr. Ramesh Gehaney ||Director and Chief Operating Officer (Executive) |
|(DIN 02697676) || |
|7. Mr. Satrajit Ray ||Director and Group Chief Financial Officer (Executive) |
|(DIN 00191467) || |
|8. Ms. Anjali Seth ||Independent Director (Non-Executive) |
|(DIN 05234352) || |
|9. Mrs. Falguni Nayar ||Independent Director (Non-Executive) |
|(DIN 00003633) || |
|10. Mr. Massimo Venuti ||Director (Non-Executive) |
|(DIN 06889772) || |
Retirement of directors by rotation
In terms of Section 152(6) of the Act Mr. Naresh Chandra Chairman (DIN: 00027696)retires by rotation at the ensuing Annual General Meeting and being eligible has offeredhimself for reappointment. Information as required under Regulation 36(3) of the ListingRegulations is provided in the Notice convening the Twenty First Annual General Meeting("AGM").
KEY MANAGERIAL PERSONNEL:
The following officials are Key Managerial Personnel' of the Company in terms ofthe provisions of Section 203 of the Act:
i. Mr. Anurang Jain Managing Director;
ii. Mr. Ramesh Gehaney Director and Chief Operating Officer (Whole Time Director);
iii. Mr. Satrajit Ray Director and Group Chief Financial Officer (Chief FinancialOfficer); and
iv. Mr. Sunil Lalai Company Secretary and Executive Vice President Legal(Company Secretary).
Number of Meetings of the Board its Committees and Meetings of the Board Committees
During the year under review the Board met six times. A detailed update on the Boardits composition and attendance of the Directors at each meeting is provided in theCorporate Governance Report.
The Board has constituted six committees namely Audit Committee Nomination andRemuneration Committee Corporate Social Responsibility Committee Stakeholders'Relationship Committee Risk Management Committee and Finance Committee. Allrecommendations made by the Committees of Board including the Audit Committee wereaccepted by the Board.
A detailed charter including terms of reference of various Board constitutedCommittees number of Committee meetings held during the financial year 2019-20 andattendance of members at each meeting forms part of the Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Act the Directors based on the representationreceived from the management confirm that:
(i) in the preparation of the annual accounts for the year ended 31st March2020 the applicable accounting standards have been followed along with proper explanationrelating to material departures;
(ii) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year 2019-20 and of theprofit and loss of the Company for that period;
(iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;(iv) they have prepared the annual accounts on a going concern basis; (v) they have laiddown internal financial controls to be followed by the Company and such internal financialcontrols are adequate and are operating effectively; and (vi) they have devised propersystems to ensure compliance with the provisions of all applicable laws and that suchsystems are adequate and are operating effectively.
DECLARATION BY INDEPENDENT DIRECTORS:
In terms of Section 149(7) of the Act and Regulation 16(1) (b) of the ListingRegulations the Independent Directors of the Company have submitted their declarationsconfirming compliance with the criteria of independence as stipulated thereunder.
All Independent Directors of the Company have affirmed compliance with the Company'sCode of Conduct for Directors and Employees for the FY 2019-20.
The Board took on record declaration and confirmation submitted by the independentdirectors regarding their fulfilment of the prescribed criteria of independence afterassessing veracity of the same as required under Regulation 25 of the Listing Regulations.
The Ministry of Corporate Affairs vide its circular dated 22nd October 2019further amended the Companies (Appointment and Qualification of Directors) Rules 2014 byrequiring an independent director to apply online within 1st May 2020 to theIndian Institute of Corporate Affairs for inclusion of his/her name in the data bank forsuch period till he/she continues to hold office of an independent director in anycompany. The independent directors were also required to submit a declaration ofcompliance in this regard. All Independent Directors of the Company have submitted suchdeclaration.
Opinion of the Board with regard to integrity expertise and experience (includingproficiency) of the Independent Directors:
The Board is of the opinion that Independent Directors of the Company areprofessionally qualified and well experienced in their respective domains. Theirqualification and vast experience in varied fields helps in strengthening Company'ssystems and processes to align the same with good industry practices andinstitutionalising tenets of corporate governance.
DIRECTORS' REMUNERATION POLICY AND CRITERIA FOR MATTERS UNDER SECTION 178 OF THE ACT:
The Nomination and Remuneration Policy approved by the Board at its meeting held on 10thJune 2016 was last revised by the Board at its meeting held on 25th June2020. This is also placed on the Company's website: www.endurancegroup.com/investor/investor-relations.In terms of the said Section the scope of the policy covers directors key managerialpersonnel and senior management employees of the Company. The policy inter alia laysdown the principles relating to appointment cessation remuneration and evaluation ofdirectors key managerial personnel and senior management employees of the Company.
Details of the Company's policy on directors' appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand other matters as stipulated under sub-section (3) of Section 178 of the Act adoptedby the Board forms part of the Corporate Governance Report.
PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND DIRECTORS:
In compliance with the provisions of Section 178 of the Act Nomination andRemuneration Policy ("NR Policy") of the Company inter alia specifies that theBoard will conduct performance evaluation of the Board as a whole and its Committees andindividual Directors. Performance evaluation of Directors shall be done by the entireBoard (excluding the director being evaluated). The Nomination and Remuneration Committeeshall continue to be responsible for implementation of the methodology followed by theCompany in this regard. The NR Policy of the Company is placed on the Company's website atwww.endurancegroup.com/investor/investor-relations.
Performance of the Board is evaluated after seeking inputs from all the directors onthe basis of criteria such as board composition and structure effectiveness of boardprocesses information and functioning its contribution in effective management of theCompany etc. Based on the assessment observations on the performance of Board arediscussed and key action areas for the Board Committees and directors are noted.
During the period under review the annual performance evaluation of the Board itsCommittees and individual directors for the financial year ended 31st March2020 was conducted by the Board at its meeting held on 25th June 2020.
Information and other details on annual performance assessment is given in theCorporate Governance Report.
The Company is in compliance with the Secretarial Standards on Meetings of Board ofDirectors (SS-1) and General Meetings (SS-2).
INFORMATION ON BOARD MEETING PROCEDURE AND ATTENDANCE DURING THE FINANCIAL YEAR2019-20:
Board meetings of the Company are conducted as per the provisions of the Act theListing Regulations and applicable Secretarial Standards. In the last meeting of thecalendar year the Board decides the schedule of meetings to be held in the succeedingyear.
Based on the dates of meetings decided by the Board adequate notice is given to alldirectors and Committee members; an agenda with detailed notes thereon is sent at leastseven days in advance for the meetings. The notes to agenda contain relevant informationand supporting documents along with recommendation from the management for meaningfuldeliberation on the agenda items. During the year under review no meeting was held at ashorter notice.
A gist of Board and Committee meetings held during the year along with attendancerecord of each director forms part of the Corporate Governance Report.
Audit Committee of the Company is constituted in terms of Section 177 of the Act andRegulation 18 of the Listing Regulations.
As on 31st March 2020 the Committee comprised following directors as itsmembers: i. Mr. Partho Datta Chairman; ii. Mr. Soumendra Basu; and iii. Ms. Anjali Seth.
All of the Committee members are non-executive independent directors and arefinancially literate as required under Regulation 18(1)(c) of the Listing Regulations.
The Committee invites the Managing Director the Director and Group Chief FinancialOfficer the Director and Chief Operating Officer the Statutory Auditors and the ChiefInternal Auditor to attend meetings of the Committee.
Mr. Sunil Lalai Company Secretary and Executive Vice President - Legal acts asSecretary to the Committee.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
The Corporate Social Responsibility ("CSR") Committee is constituted incompliance with Section 135 of the Act.
As on 31st March 2020 the CSR Committee comprised following directors asits members: i. Mr. Anurang Jain Chairman; ii. Mr. Soumendra Basu; and iii. Mr. RameshGehaney.
RISK MANAGEMENT COMMITTEE:
The Risk Management Committee ("RMC") is constituted in compliance withRegulation 21 of the Listing Regulations.
As on 31st March 2020 the RMC comprised following directors as itsmembers: i. Mr. Anurang Jain Chairman; ii. Mr. Partho Datta; iii. Mr. Ramesh Gehaney; andiv. Mr. Satrajit Ray.
The Company has a Risk Management Policy which was framed in June 2015 and was lastrevised in August 2019.
The policy lays down a framework for risk management and mitigation processcommensurate with the scale and nature of the Company's business. The policy alsoidentifies the risk categories in line with the Company's growth strategy continuouslychanging business environment and legislative requirements. As per the terms of referenceof RMC it is entrusted with responsibility to review risk management framework.
The risk management framework defines thresholds against each of the identified riskevents and mitigation measures to alleviate such risks. The framework is dynamic in natureand is reviewed periodically by the respective functions. The senior management teamreviews the critical risk events and implements action plan to avoid recurrence of suchevents. A risk report is reviewed bi-annually by the RMC and critical matters if anyalong with mitigation plans are placed before the Board for review.
During the year under review ICRA Ltd a credit rating agency registered with SEBI hadreaffirmed the long term rating of ICRA AA+/ Stable and ICRA A1+ for short term rating.CRISIL Limited a credit rating agency registered with the SEBI has reaffirmed theCompany's long-term rating of CRISIL AA/ Positive and short-term rating of CRISIL A1+.
INTERNAL FINANCIAL CONTROLS:
In terms of Section 134(5)(e) of the Act the term Internal Financial Control means thepolicies and procedures adopted by a company for ensuring orderly and efficient conduct ofits business including adherence to company's policies safeguarding of its assetsprevention and detection of frauds and errors accuracy and completeness of the accountingrecords and timely preparation of reliable financial information.
The Company has adequate Internal Financial Control system in the form of policies andprocedures. It follows a structured mechanism of function-specific reviews and riskreporting by the Management Committee of the Company and critical matters are brought tothe attention of the Audit Committee and the Board. Further internal Standard OperatingProcedures (SOPs) and Schedule of Authority (SOA) are well defined and documented toprovide clear guidance to ensure that all financial transactions are authorised recordedand reported correctly.
In order to record day-to-day financial transactions and ensure accuracy in reportingthereof the Company uses an established Enterprise Resource Planning (ERP) system.Adequate controls and checks are built in the ERP system to integrate the underlying booksof account and prevent any kind of control failure. Mapping of policies and proceduresincluding SOPs and SOA is done through ERP and audit of these processes forms part of thework scope of both internal and statutory auditors of the Company.
The Company has an in-house Internal Audit (IA) team lead by Chief Internal Auditor whoreports to the Audit Committee. The scope of work accountability responsibilityreporting and authority of the IA department is defined in the Internal Audit Charterwhich is reviewed by the Audit Committee annually.
The IA team draws up an internal audit plan in advance for a financial year which isapproved by the Audit Committee and progress thereof is reviewed by the Committee at itsquarterly meetings. In order to ensure objectivity and independence of the auditmechanism internal audit activities for certain plants are outsourced. The IA teamconducts audits of plants and corporate functions specifically emphasising on statutorycompliance covering adherence to SOPs controls and internal guidelines issued by themanagement. Implementation of the audit recommendations are monitored by the IA team.
Report on audit findings and corrective measures taken by the respective processowners is reviewed periodically by the senior management team of the Company comprisingthe Managing Director the Director and Group Chief Financial
Officer and the Director and Chief Operating Officer. Significant observations andstatus of implementation of recommendations of the IA team are presented to the AuditCommittee. The Committee reviews the report and advises on improving the systems andprocesses where necessary.
The Company's internal control mechanism is commensurate with the scale of itsoperations thereby ensuring compliance of the Act and the Listing Regulations.
In compliance with Regulation 34 of the Listing Regulations a separate report onCorporate Governance along with a certificate from the statutory auditors towardscompliance of the provisions of Corporate Governance forms an integral part of thisAnnual Report.
The Managing Director and the Director and Group Chief Financial Officer have certifiedto the Board with regard to financial statements and other matters as required underRegulation 17(8) read with Schedule II to the Listing Regulations.
BUSINESS RESPONSIBILITY REPORT:
In terms of Regulation 34(2) of the Listing Regulations a Business ResponsibilityReport for the financial year 2019-20 forms part of this Annual Report.
CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING AND FAIR DISCLOSURE OF UNPUBLISHEDPRICE SENSITIVE INFORMATION:
The Company has adopted a Code of Conduct for Prevention of Insider Trading'("PIT Code") in terms of the SEBI (Prohibition of Insider Trading) Regulations2015 ("PIT Regulations"). Further the Company has also adopted a Code ofPractices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information'("UPSI Code").
The PIT Code and UPSI Code are drawn up on the principle that the Company's directorsand employees owe a fiduciary duty amongst others to the shareholders of the Company toplace the interest of shareholders above their own and conduct their personal securities'transactions in a manner that does not give rise to any conflict of interest.
The PIT Code lays down guidelines for designated persons' on the procedures to befollowed and disclosures to be made while dealing in securities of the Company and alsostipulates the consequences of non-compliances or leak of confidential price sensitiveinformation. The PIT Code was last revised by the Board of Directors at its meeting heldon 6th February 2020 pursuant to notification of the SEBI (Prohibition ofInsider Trading) (Third Amendment) Regulations 2019. In terms thereof the PIT Code wasamended to include provisions for suitable protection against any discharge terminationdemotion suspension threats harassment directly or indirectly or discriminationagainst any employee who files a Voluntary Information Disclosure Form relating to analleged violation of insider trading laws.
The UPSI Code documents the manner of disseminating UPSI for making it accessible tothe public on non-discriminatory basis.
Any information is determined to be UPSI based on the principles enumerated in theCompany's policy on Determination of Materiality of Event / Information'.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 is attached as Annexure II.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:
In terms of Schedule VII to the Act and Company's Corporate Social Responsibility("CSR") Policy the Company has undertaken CSR projects under the aegis of SevakTrust with whom it has been associated for more than a decade. The CSR projects andprogrammes approved by the Board are aimed towards enhancing employability by impartingskill-building vocational training to unemployed youth and undertake developmentalactivities in villages to improve living standards and welfare through educationpromoting health & hygiene educating on agriculture methods & means oflivelihood provision of community facilities and the like. As part of its CSRinitiatives the Company has also undertaken the responsibility of upgrading the SevakTrust Balwadi. This Balwadi located in Waluj Aurangabad provides pre-primary educationto children from economically weaker sections of the society. Apart from the above theCommittee also approved certain micro projects for cleanliness of drains and providingdrinking water by installation of reverse osmosis (RO) plants.
Details about the CSR Policy and initiatives undertaken during the year are availableon Company's website at www.endurancegroup.com. The Annual Report on CSR activitiesis attached as Annexure III to this Report.
Expenditure towards CSR activities
During the year under review the Company had earmarked an amount of Rs 86.38 millionand thus approved a budget of
Rs 87 million for expenditure towards CSR activities. The Board of Directors haveapproved following projects / programmes which are as per Schedule VII to the Act and CSRPolicy of the Company:
1. Village Development Project;
2. Vocational Training Centre;
3. Sevak Trust Balwadi; and
4. Other micro projects for cleanliness of drains and providing drinking water byinstallation of RO plants.
Further the Company also contributed Rs 50 million in March 2020 to the PM CARESFund which has been constituted with the primary objective of dealing with any emergencyor distress situation such as the one posed by COVID-19 pandemic and to provide reliefto the affected.
Accordingly the total CSR expenditure during the financial year 2019-20 was Rs 138.52million which includes Rs 88.52 million towards above-mentioned projects and programmesand contribution of Rs 50 million to the PM CARES Fund.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS:
During the year under review no instances of fraud have been reported under Section143(12) of the Act.
The Members of the Company at their Eighteenth Annual General Meeting had approvedappointment of M/s. S R B C & CO. LLP (ICAI Firm Registration No. 324982E/ E300003) asStatutory Auditors of the Company from the conclusion of Eighteenth AGM till theconclusion of Twenty Third Annual General Meeting of the Company.
As per the provisions of Section 148 of the Act and Rule 3 of the Companies (CostRecords and Audit) Rules 2014 the Company is required to maintain cost records withrespect to the manufacturing activities viz. manufacturing of engine componentsmanufacturing of dies & moulds and generation of electricity through windmill and getthe same audited. Based on the recommendation of the Audit Committee the Board hasappointed Mr. Jayant B. Galande Cost Accountant (Membership No. M-5255) as Cost Auditorof the Company for the financial year 2020-21. The remuneration proposed is
Rs 400000 and is subject to ratification by the shareholders at the ensuing AGM. Thesaid remuneration is excluding applicable taxes and out-of-pocket expenses if anypayable at actuals.
In terms of the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial
Personnel) Rules 2014 the Board of Directors had appointed Mr. Sachin Bhagwat(Membership No. A10189 CP No. 6029) Practicing Company Secretary to conduct an audit ofthe secretarial records for the financial year 2019-20.
The Secretarial Audit Report for the financial year 2019- 20 is set out as AnnexureIV to this report. The said report does not contain any qualification reservation oradverse remark.
Policies of the Company
The Listing Regulations mandate formulation of certain policies for listed companies.Accordingly the Board of Directors has from time to time framed and approved policiesas required under the Listing Regulations as well as under the Act.
Listed below are certain key policies that have been framed by the Company:
|Sr. Name of Policy |
|1. Nomination and Remuneration Policy |
|2. Corporate Social Responsibility Policy |
|3. Dividend Distribution Policy |
|4. Whistle Blower Policy |
|5. Risk Management Policy |
|6. Code of Conduct for Prevention of Insider Trading |
|7. Code of Conduct for Directors and Employees |
|8. Code of Practices and Procedures for Fair disclosure |
|of Unpublished Price Sensitive Information |
|9. Policy for determination of Materiality of Subsidiaries |
|10. Policy for Determination of Materiality of and Dealing with Related Party Transactions |
|11. Policy for Determination of Materiality of Events/ Information |
|12. Policy for Preservation of Documents |
|13. Archival Policy for disclosures to Stock Exchanges |
The above-mentioned policies are available on the Company's website at the linkwww.endurancegroup.com/investor/ investor-relations.
These policies are periodically reviewed by the Committees responsible therefor andchanges if any are recommended to the Board for approval. Changes to the policies alsofactor amendments in statutes or governing regulations. During the period from 1stApril 2019 till the date of report the following policies were revised:
|Sr. Name of Policy No. ||Revised effective |
|1. Risk Management Policy || |
|2. Policy on Determining Materiality of and Dealing with Related Party Transactions ||8th August 2019 |
|3. Policy on determining Materiality of and dealing with Related Party transactions ||6th February |
|4. Code of conduct for Prevention of Insider Trading ||2020 |
|5. Policy for Determination of Materiality of Event / Information || |
|6. Archival Policy for Disclosures to Stock Exchanges ||25th June 2020 |
|7. Policy for preservation of documents || |
|8. Nomination and Remuneration Policy || |
Based on the recommendation of Nomination and Remuneration Committee the Nominationand Remuneration ("NR") Policy was revised by the Board at its meeting held on25th June 2020. The changes primarily related to payment of remuneration toIndependent Directors and the process of performance evaluation being conducted by theBoard. Further the policy document was modified to include identification of attributesand domain experience to be assessed while appointing a new Director on the Board.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
Disclosure of remuneration and other details as required under Section 197(12) of theAct read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are annexed herewith as Annexure V.
A statement containing particulars of employees as required under Section 197(12) ofthe Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is provided as a separate annexure forming part of thisReport. In terms of Section 136 of the Act the Annual Report and financial statements arebeing sent to the shareholders excluding the aforesaid annexure. The said annexure isavailable for inspection at the registered office of the Company during business hours andwill be made available to any shareholder on request.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The Company has not advanced any loans or given guarantees covered under the provisionsof Section 186 of the Act. Particulars of investments form part of the notes to financialstatements.
During the year under review the Company has not accepted any deposits from thepublic.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY:
In terms of the provisions of Section 177(9) of the Act read with Rule 7 of theCompanies (Meetings of Board and its Powers) Rules 2014 the Company has established avigil mechanism (which forms part of the Whistle Blower policy in terms of Regulation 22of the Listing Regulations) for Directors and employees to report their genuine concerns.The objective of this policy is to create a window for any person who observes anunethical behaviour actual or suspected fraud or violation to the Company's Code ofConduct for Directors and Employees and to report the same to the Ombudsman appointedunder the same policy. The said policy also encompasses reporting of instances of leak ofUPSI.
Protected disclosures can be made by a whistle blower to the dedicated e-mail ID and/or postal address of Ombudsman appointed under the Policy. The policy has been hosted onthe Company's website at www.endurancegroup.com.
An Ombudsman has been appointed in terms of the provisions of the Act to independentlyinvestigate protected disclosures communicated under the Policy and matters of violationto the Company's Code of Conduct for Directors and Employees.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY BETWEEN 31STMARCH 2020 AND DATE OF BOARD'S REPORT:
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 the date ofthis Report.
RELATED PARTY TRANSACTIONS:
As per the Listing Regulations all Related Party Transactions (RPT) and anymodifications thereto are placed before the Audit Committee for approval.
During the year the Company did not enter into any contract/ arrangement/ transactionwith related parties which could be considered material for which shareholders' approvalis required in accordance with Section 188 of the Act and the Policy on DeterminingMateriality of and Dealing with Related Party Transaction ("RPT Policy").
Accordingly there is no information to be disclosed in Form AOC-2 while theparticulars of all RPTs in terms of Indian Accounting Standard (Ind AS) 24 areforming part of the financial statements.
The RPT Policy of the Company as approved by the Board can be accessed on theCompany's website at www.endurancegroup.com/ investor/investor-relations.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS:
There were no significant material orders passed by Regulators /Courts which wouldimpact the going concern status of the Company and its future operations.
In terms of Section 92(3) of the Act the annual return of the Company for thefinancial year ended 31st March 2020 shall be available on the Company'swebsite: www.endurancegroup.com/investor/investor-relations.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:
The Company has adopted a "Policy on Safety & Security and Prevention ofSexual Harassment of Women Employees" ("POSH Policy") in line with therequirements of The Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013. The POSH Policy aims to provide a safe friendly positive andproductive working environment and promote an atmosphere in which employees can realisetheir maximum potential. The policy applies to all permanent and temporary employees andalso to workmen engaged by the Company through contractors.
The Company observes zero tolerance towards any kind of violation of the aforementionedPOSH Policy. As per POSH policy the Company has constituted Internal ComplaintsCommittees ("ICC") for all its locations which are chaired by a female employeeand senior management officials of the Company are its members along with representativeof non-government organisation / association committed to the cause of women or a personfamiliar with the issues relating to sexual harassment. The ICC is responsible forredressal of complaints related to sexual harassment and follows the guidelines providedin the POSH Policy.
During the year under review two complaints were received by the ICC under the POSHPolicy. One complaint was satisfactorily resolved and one complaint was pending as thesame was received during end March 2020. As on the date of the report the secondcomplaint was under investigation by the ICC and received due attention after the lockdowndue to COVID-19 was relaxed.
During the year under review the industrial relations remained cordial. We have elevenagreements entered into with labour unions for the Company's plants located atWaluj (Aurangabad Maharashtra) Chakan (Dist. Pune Maharashtra) and Pantnagar(Uttarakhand).
INVESTOR EDUCATION AND PROTECTION FUND:
In accordance with the provisions of Sections 124 and 125 of the Act and InvestorEducation and Protection Fund (Accounting Audit Transfer and Refund) Rules 2016("IEPF Rules") dividends of a company which remain unpaid or unclaimed for aperiod of seven years from the date of transfer to the Unpaid Dividend Account shall betransferred by the company to the Investor Education and Protection Fund("IEPF").
In terms of the foregoing provisions of the Act no dividend amount or shares wererequired to be transferred to the IEPF by the Company during the year ended 31stMarch 2020.
The Company has uploaded details of unpaid and unclaimed dividend amounts lying withthe Company as on 30th November 2019 on the Company's website www.endurancegroup.com/investor/investor-relations and on the website of the Ministry of Corporate Affairs atwww. iepf.gov.in.
The following table provides dates on which unclaimed dividend and their correspondingshares would become liable to be transferred to the IEPF:
|Financial Year ||Date of declaration of dividend/ interim dividend ||Amount of unpaid dividend as on 31st March 2020 (in Rs) ||Due date for transfer to IEPF |
|2016-17 ||28th July 2017 ||47782.50 ||31st August 2024 |
|2017-18 ||6th September 2018 ||42072.00 ||11th October 2025 |
|2018-19 ||8th August 2019 ||46079.00 ||12th September 2026 |
|2019-20 ||3rd March 2020 ||136460.50 ||7th April 2027 |
Your Directors take this opportunity to express their sincere appreciation towards thecommitment hard work and support of all its employees & workmen during the year.
The Directors also express gratitude to the shareholders workmen unions customersvendors dealers bankers government authorities of India and other countries where theCompany operates and all other business associates for their continued support extended tothe Company and reposing their confidence in the management. The management looks forwardto their continued support in future.
| ||For and on behalf of the Board |
| ||Naresh Chandra |
| ||Chairman |
|Date: 25th June 2020 ||DIN: 00027696 |