To the Members
Hindustan Composites Limited
Your Directors are pleased to present the Fifty Sixth Annual Report together with theStandalone and Consolidated Audited Financial Statements of the Company for the year ended31 March 2020.
1. FINANCIAL HIGHLIGHTS
The Companys' financial performance for the year ended 31 March 2020 is summarizedbelow:
(Rs in Lakhs)
|Particulars ||Standalone ||Consolidated |
| ||2019-20 ||2018-19 ||2019-20 ||2018-19 |
|Revenue from Operations ||17805.19 ||19661.31 ||17805.19 ||19661.31 |
|Other Income ||49.49 ||217.21 ||49.49 ||217.21 |
|Profit before Interest Depreciation and Taxes ||2004.09 ||2720.39 ||1848.00 ||2575.17 |
|Less: Interest ||22.31 ||22.27 ||22.31 ||22.27 |
|Less: Depreciation (Net) ||950.30 ||874.70 ||950.30 ||874.70 |
|Profit Before Tax ||1031.48 ||1823.42 ||875.39 ||1678.20 |
|Less: Provision for Tax ||-172.02 ||-76.68 ||-172.02 ||-76.68 |
|Profit After Tax ||1203.50 ||1900.10 ||1047.41 ||1754.88 |
|Other Comprehensive Income / Loss (Net of Tax) ||32.41 ||456.05 ||32.41 ||456.05 |
|Total Comprehensive Income ||1235.91 ||2356.15 ||1079.82 ||2210.93 |
2. IMPACT OF THE COVID-19 PANDEMIC
The COVID-19 pandemic has intensified into a global crisis driving the nation toenforce lock-down of all economic activity for the last few months. We remain committed tothe health and safety of our employees and their families as well as business continuityto safeguard the interests of our employees customers and other stakeholders. The impactof the pandemic on our business performance is outlined in the Operational Performance andunder the Management and Discussion Analysis Report forming a part of this Report.
3. OPERATIONAL PERFORMANCE
During the financial year 2019-20 the Company has achieved total revenue of Rs17805.19 Lakhs as against Rs 19661.31 Lakhs in the previous year. The net manufacturingrevenue was lower by 9 % from Rs 15842.05 Lakhs to Rs 14489.55 Lakhs This decline wasmainly due to severe slowdown in the automotive segment and the closure of plants in thelater part of March 2020 on account of COVID-19 countrywide lockdown.
The Investment Income during the year was also lower at Rs 3315.64 Lakhs as against Rs3819.26 Lakhs in the previous year. It was achieved despite challenging investmentscenario with economic uncertainties volatile market condition fear of NPA bankingfrauds and falling interest rates.
The gross profit of the company was lower at Rs 2004.09 Lakhs against Rs 2720.39Lakhs in the previous year. After considering interest of Rs 22.31 Lakhs and depreciationof Rs 950.30 Lakhs the Profit before tax was Rs 1031.48 Lakhs; with a net reversal oftax of Rs 172.02 Lakhs the profit after tax was Rs 1203.50 Lakhs. The Other compressiveincome (OCI) net of tax was Rs 32.41 Lakhs and the total comprehensive income was Rs1235.91 Lakhs.
During the year under review the overall economy remained subdued with a sharpreduction in demand in automotive segment. The industry was impacted by several factorsincluding the slowdown in the economy challenges of credit availability and rising costof vehicle ownership. This resulted in a low order book from OEM customers particularlyin the Commercial vehicle segment which constitutes our major business. This shortfallwas however partly compensated with higher business in the railway segment throughtenders at competitive prices. The business environment was further aggravated with thesudden lockdown imposed on the entire county in the later part of March 2020 due to theCOVID-19 pandemic. As a result all our establishments including both the plantsremained closed from 23 March 2020 onwards. This also impacted the sales andprofitability of the Company.
The world today is going through an extraordinary situation.
We are experiencing a pandemic which has severely impacted all aspects of our lives anddisrupted business in unprecedented ways. The challenges are unique as COVID-19 inducedlockdowns have disrupted the economic activity in many ways. Partial relaxations are ofnot much use as hindrances to the supply chain logistics and transportation of goodscontinue. As a Company we have complied with all safety regulations notified by thegovernment from time to time. Whilst we took the initiative of Work from home' atour offices our production facilities however remained closed for a majority of timesin the months of April and May 2020 which have impact on both production and sales. Theautomotive sector is one of the worst hit sectors and has created a major demand crisisfor our products. Despite these challenges the Company continues to find ways and meansto improve its business in the coming months and work towards implementing various costcontrol measures.
The Investment segment is also facing similar challenges due to the liquidity crisisbanking / NBFC frauds fear of higher NPA's falling interest rates and volatile stockmarket conditions. Although the Government has announced certain stimulus packages to easeliquidity and boast the economy uncertainty remains. Under such circumstances theCompany shall remain extremely cautious and continue to maintain its conservative approachtowards safer investment opportunities.
The Company participated at the Auto Expo 2020 exhibition at Pragati Maidan New Delhiin February 2020 the largest automotive show in Asia. The response from both domestic andinternational customers was encouraging.
The working of the Companys' Joint Venture Compo Advics (India) Pvt. Ltd.' thoughmarginally improved but remained under pressure due to depressed market conditionsfollowed by COVID-19 stress. Several measures are however being taken to improve theworking.
There is no change in the nature of business of the Company during the year underreview.
4. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE ENDOF THE FINANCIAL YEAR AND DATE OF THE REPORT
There have been no material changes and commitments affecting the financial position ofthe Company between the end of the Companys' financial year to which the financialstatements relate and upto the date of this report except impact of COVID 19 generatedsituation quantification of which cannot be done at this point of time.
5. SHARE CAPITAL OF THE COMPANY
During the financial year under review there was no change in paid up share capital ofthe Company. The paid up equity share capital of your Company as on 31 March 2020 was Rs73845000 (Rupees Seven Crore Thirty Eight Lakhs Forty Five Thousand only) divided into14769000 equity shares of the face value of Rs 5 (Rupees Five only) each fully paid up.
Your Directors have recommended a dividend of Rs 2/- per share (previous year Rs 2/-per share) of Rs 5 each being 40 % (previous year 40%) on equity share capital for theyear ended 31 March 2020. This will absorb total cash outflow of Rs 295.38 Lakhs. Thedividend if approved will be paid to those members whose names shall appear on theRegister of Members / List of Beneficiaries as on Tuesday 22 September 2020
During the year under review Rs 1000 Lakhs (previous year 1500 Lakhs) weretransferred to the General Reserve.
8. SUBIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES
Your Company has a Joint Venture Company namely "Compo Advics (India) PrivateLimited". The Company had no subsidiary or associate company during the year underreview.
Pursuant to the provisions of Section 129(3) of the Companies Act 2013 (theAct') a statement containing salient features of the financial statements of the JointVenture Company in Form AOC-1 is attached to the financial statements of the Companyforming part of this Annual Report.
9. CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to the provisions of Sections 129 and 133 of the Act read with the Companies(Accounts) Rules 2014 and as required under Regulation 34 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has preparedConsolidated Financial Statements consolidating financial statements of its Joint VentureCompany namely "Compo Advics (India) Private Limited" with its financialstatements in accordance with the applicable provisions of Indian Accounting Standards("IndAS").
The Consolidated Financial Statements along with the Independent Auditors' Reportthereon are annexed and form part of this Report.
The summarized consolidated financial position is provided above in point no. 1 of thisReport.
10. RISKS AND AREAS OF CONCERN
The Company has laid down a well-defined Risk Management Policy covering the riskmapping trend analysis risk exposure potential impact and risk mitigation process. Adetailed exercise is being carried out from time to time to identify evaluate manage andmonitoring of both business and non-business risk. The Board periodically reviews therisks and suggests steps to be taken to control and mitigate the same through a properlydefined framework.
The most significant emerging risk is the ongoing outbreak of the novel coronavirus(COVID-19). These are challenging times for the world at large. The outbreak of COVID-19and its rapid acceleration across the globe are concerning. While the human impact of thevirus takes precedence for all of us we continue to monitor the developments closely andare wary of the adverse impact on our business.
11. EXTRACT OF ANNUAL RETURN
An extract of Annual Return of the Company as on 31 March 2020 in Form MGT 9 inaccordance with Section 92 (3) of the Act read with the Companies (Management andAdministration) Rules 2014 is annexed to this report as "Annexure A" andforms a part of this Report and put up on the website of the Company at the linkhttps://www. hindcompo.com/investor-relations/annual-reports.htm.
12. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
As on 31 March 2020 the Board comprised of seven directors including one independentwomen director. The Board has an appropriate mix of Executive Directors Non-ExecutiveDirectors and Independent Directors which is in compliance with the requirements of theCompanies Act 2013 and the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and is also aligned with the best practices of Corporate Governance.
a) Retirement by rotation
In accordance with the provisions of Section 152 of the Act read with Companies(Management and Administration) Rules 2014 and Articles of Association of the CompanyMr. P. K. Choudhary (DIN: 00535670) Managing Director of the Company retires by rotationat the ensuing Annual General Meeting and being eligible has offered himself forre-appointment and your Board recommends his re-appointment.
b) Appointment and reappointment
The Members in its 55 Annual General Meeting held on 29 August 2019 had approved there-appointment of Mr. Deepak Sethi (DIN 07165462) as Independent Non - Executive Directorof the Company for another five consecutive years to hold office from 23 April 2020 to 22April 2025 by passing of a Special resolution pursuant to the provisions of Section149(10) read with Schedule IV of the Act. Mr. P. K. Choudhary was reappointed as ManagingDirector of the Company for further period of five years to hold office from 1 July 2019to 30 June 2024.
During the year 2019-20 Mr. Lalit Kumar Bararia (DIN 00204670) and Mrs. Preeti VimalAgrawal (DIN 08693668) were appointed as Additional Independent Non - Executive Directorsupon recommendations of Nomination and Remuneration Committee subject to approval ofshareholders for a period of five consecutive years w.e.f. 13 February 2020 to 12February 2025 in the Board meeting held on 13 February 2020. This shall be placed formembers' approval at the ensuing AGM.
Further in the opinion of the Board Mr. Lalit Kumar Bararia and Mrs. Preeti VimalAgrawal are persons of high integrity expertise and experience and thus qualify to beappointed as Independent Directors of the Company. Further as required under Section150(1) of the Companies Act 2013 they have registered themselves as Independent Directorsin the independent director data bank. They have also passed the proficiencyself-assessment test in terms of Companies (Appointment and Qualifications of Directors)Rules 2014.
The Board based on the recommendation of Nomination and Remuneration Committee at itsmeeting held on 29 June 2020 approved the re-appointment Mr. Raghu Mody (DIN: 00053329)as an Executive Chairman and Whole Time Director of the Company for a further period ofthree years commencing from 1 October 2020 to 30 September 2023. This shall be placedfor members' approval at the ensuing AGM.
The resolutions seeking approval of members for appointment of Mr. Lalit Kumar Barariaand Mrs. Preeti Vimal Agrawal as Independent Directors of the Company and re-appointmentof Mr. Raghu Mody as Executive Chairman and Whole Time Director of the Company along withtheir brief resume as stipulated under Regulations 26(4) and 36(3) of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and Secretarial Standard 2 onGeneral Meetings is given in the Notice convening the 56 Annual General Meeting of theCompany. The Board recommends their appointment and reappointment respectively.
Mrs. Sakshi Mody Non - Executive Director of the Company had resigned from thedirectorship of the Company w.e.f. closing hours of 13 February 2020 due to her personalreasons.
Mr. Chakrapani Brajesh Misra Independent Non- Executive Director of the Company hasresigned w.e.f. 28 February 2020 because of his increased professional workload andoncoming professional commitments due to which he was not able to devote time to theCompany. He had also confirmed that there was no other material reason other than thoseprovided in his resignation letter for his resignation.
The Board places on record its sincere appreciation for the valuable contribution madeby them during their tenure as directors of the Company.
d) Declaration from Independent Directors
The Company has received declaration from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under Section149(6) of the Act and Regulation 16(1)(b) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and pursuant to Regulation 25 of the said Regulations thatthey are not aware of any circumstance or situation which exist or may be reasonablyanticipated that could impair or impact their ability to discharge their duties with anobjective independent judgment and without any external influence. The IndependentDirectors have also confirmed that they have complied with Schedule IV of the Act and theCompanys' Code of Conduct.
Further the Independent Directors have also submitted their declaration in compliancewith the provision of Rule 6(3) of Companies (Appointment and Qualification of Directors)Rules 2014 which mandated the inclusion of an Independent Director's name in the databank of Indian Institute of Corporate Affairs ("IICA") for a period of one yearor five years or life time till they continue to hold the office of an independentdirector.
None of the directors of your Company are disqualified under the provisions of Section164(2) of the Companies Act 2013. Your directors have made necessary disclosures asrequired under various provisions of the Companies Act 2013 and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
In the opinion of the Board all the independent directors are persons of integrity andpossesses relevant expertise and experience.
e) Annual Performance and Board Evaluation
The Board has devised a policy pursuant to the provisions of the Companies Act 2013and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 forperformance evaluation of the chairman board individual directors (including independentdirectors) and committees which includes criteria for performance evaluation ofnon-executive directors and executive directors.
The Nomination and Remuneration Committee of the Company has specified the manner ofeffective evaluation of the performance of Board its committees and individual directorsof the Company and has authorized the Board to carry out their evaluation based on themanner specified by the Nomination and Remuneration Committee. The Board has devisedquestionnaire to evaluate its performances and performance of its Committees andindividual directors and the chairperson. The performance of each committee was evaluatedby the Board based on report on evaluation received from respective Board committees. Thereports on performance evaluation of the individual directors were reviewed by theChairman of the Board.
The evaluation framework for assessing the performance of directors comprises of thefollowing key areas:
i. Attendance at Board Meetings and Committee Meetings;
ii. Quality of contribution to Board deliberations;
iii. Strategic perspectives or inputs regarding future growth of Company and itsperformance;
iv. Providing perspectives and feedback going beyond information provided by themanagement.
The details of the programmes for familiarization of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company at the link: https://www.hindcompo.com/investor-relations/documents/familiarisation-programes-for-independent-directors.pdf
f) Key managerial Personnel (KMP)
The Key Managerial Personnel of the Company are as follows:
|Sr. No. ||Name ||Designation |
|1. ||Mr. Raghu Mody ||Executive Director & Chairman related to Promoter |
|2. ||Mr. P. K. Choudhary ||Managing Director |
|3. ||Mr. Sunil Jindal ||Chief Financial Officer |
|4. ||Mr. Vikram Soni ||Company Secretary and Compliance Officer |
13. MANAGERIAL REMUNERATION AND OTHER DETAILS
Disclosure pertaining to remuneration and other details as required under Section 197of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in this Report as"Annexure B" and forms a part of this Report.
The 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 in a separate annexure forming part of thisReport. Further in terms of Section 136 of the Act the report and accounts are being sentto the members excluding the aforesaid annexure. The said annexure is available forinspection at the registered office of the Company during the working hours and any memberinterested in obtaining a copy of the same may write to the Company Secretary andCompliance Officer of the Company and the same will be furnished on request.
14. REMUNERATION POLICY
Pursuant to the provisions of Section 178 of the Act and Regulation 19 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 and on the recommendation ofthe Nomination and Remuneration Committee the Board of Directors have adopted a policyfor selection and appointment of Directors Key Managerial Personnel (KMPs') SeniorManagement Personnel (SMPs') and their remuneration including criteria fordetermining qualifications positive attributes independence of a director and otherrelated matters.
The Remuneration Policy is placed on the website of the company viz. www.hindcompo.com.
15. MEETINGS OF THE BOARD
The Board met five times during the financial year under review the details of whichare given in the Corporate Governance Report. The intervening gap between the twoconsecutive meetings was within the period prescribed under the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
16. COMMITTEES OF THE BOARD
Details of the Committees constituted by the Board under the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 along with theircomposition and changes if any during the year and the number and dates of meetingsheld during the financial year under review are provided in the Corporate GovernanceReport which forms part of this Report.
17. AUDIT COMMITTEE AND ITS COMPOSITION
During the year 2019-20 the Audit Committee was reconstituted and Mr. Lalit KumarBararia Additional Non Executive Independent Director was appointed as Chairmaneffective from 12 March 2020 in place of Mr. Chakrapani Brajesh Misra who ceased to bethe member of the Audit Committee upon his resignation as a director of the Company w.e.f.28 February 2020. As on 31 March 2020 the Audit Committee comprised of Mr. Lalit KumarBararia Mr. A. B. Vaidya Mr. Deepak Sethi Lt. Gen. (Retd.) K. S. Brar and Mr. RaghuMody. The Company Secretary and Compliance officer of the Company acts as the Secretary ofthe Audit Committee. All the recommendations made by the Audit Committee were accepted bythe Board of Directors of the Company. Other details with respect to Audit Committee aregiven in Corporate Governance Report.
The Audit Committee of the Company reviews the reports to be submitted to the Board ofDirectors with respect to auditing and accounting matters. It also supervises theCompanys' internal control financial reporting process and vigil mechanism.
18. DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors to the best of their knowledge and belief and according to theinformation and explanations obtained by them and as required under Section 134(3)(c) readwith Section 134(5) of the Companies Act 2013 state that:
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;
(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 at the end of the financial year and ofthe profit of the company for that period;
(c) the directors 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;
(d) the directors have prepared the annual accounts on a going concern basis;
(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
19. PUBLIC DEPOSITS
During the financial year under review the Company has not accepted any publicdeposits within the meaning of Section 73 and 76 of the Companies Act 2013 read withCompanies (Acceptance of Deposits) Rules 2014.
20. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO INSECTION 188(1) OF THE COMPANIES ACT 2013
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on arm's lengthbasis and are entered into based on considerations of various business exigencies such assynergy in operations their specializations etc. and to further the Companys' interests.
Pursuant to the provisions of Section 188(2) of the Act the details of materialrelated party transactions are given in the prescribed Form AOC-2 under Companies(Accounts) Rules 2014 is annexed to this report as "Annexure C" andforms a part of this report.
In accordance with the provisions of Regulation 23 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Company has adopted the policy on relatedparty transactions and the same is available on the Companys' website athttps://www.hindcompo.com/investor-relations/documents/related-party-transaction-policy.pdf.
21. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIESACT 2013
The details of loans guarantee or investments made by the Company under Section 186 ofthe Act are given under notes to accounts on financial statements forming part of thisAnnual Report.
22. CORPORATE SOCIAL RESPONSIBILITY INITIATIVE
Pursuant to the provisions of Section 135 read with Companies (Corporate SocialResponsibility) Rules 2014 the Company has formed Corporate Social ResponsibilityCommittee and a Policy on Corporate Social Responsibility (CSR'). As part of itsinitiatives under CSR the Company has undertaken project for promoting education inaccordance with Schedule VII of the Act. The policy on Corporate Social Responsibility hasbeen placed on the website of the Company i.e. www.hindcompo.com.
The details as per the provisions of Rule 8 of Companies (Corporate SocialResponsibility) Rules 2014 are annexed to this report as "Annexure - D"and forms a part of this Report.
23. WHISTLE BLOWER/ VIGIL MECHANISM POLICY
The Company has a Vigil Mechanism / Whistle Blower Policy to deal with instances offraud and mismanagement if any. The mechanism also provides for adequate safeguardsagainst victimization of directors and employees who avails of the mechanism and alsoprovide for direct access to the Chairman of the Audit Committee in the exceptional cases.
The details of the Vigil Mechanism Policy is explained in the Corporate GovernanceReport and the policy has been placed in the website of the company viz. www.hindcompo.com.
We affirm that during the financial year 2019-20 no employee or director was deniedaccess to the Audit Committee.
24. STATUTORY AUDITORS
As per provisions of Section 139 of the Act read with the Companies (Audit andAuditors) Rules 2014 the Members of the Company in their 53 Annual General Meeting heldon 12 September 2017 appointed M/s. Bagaria & Co. LLP Chartered Accountants Mumbai(Firm Registration No. 113447W) as the Statutory Auditors of the Company for a term ofconsecutive 5 years i.e. to hold office from the conclusion of 53 Annual General Meetingtill the conclusion of 58 Annual General Meeting of the Company to be held for thefinancial year ending 31 March 2022 subject to the ratification by members of theCompany every year.
However after the amendment in Section 139 of the Act effective 7 May 2018ratification by shareholders every year for the appointment of the Statutory Auditors isno longer required; accordingly they will hold office upto the conclusion of 58 AnnualGeneral Meeting of the Company to be held for the financial year ending on 31 March 2022.
M/s. Bagaria & Co. LLP has furnished written confirmation to the effect that theyare not disqualified from acting as the Statutory Auditors of the Company in terms of theprovisions of Sections 139 and 141 of the Act and the Companies (Audit and Auditors) Rules2014.
25. SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed M/s. MBaldeva Associates Company Secretaries Thane to undertake Secretarial Audit of theCompany for the financial year 2019-20. The Secretarial Audit Report is annexed to thisreport as "Annexure E" and forms a part of this Report.
26. INTERNAL AUDITORS
Pursuant to the provisions of Section 138 of the Act read with Companies (Accounts)Rules 2014 the Board on recommendation of the Audit Committee re-appointed M/s. S M M P& Associates Chartered Accountants Mumbai as Companys' Internal Auditors. TheInternal Auditors monitor and evaluate the efficacy and adequacy of internal controlsystem in the Company its compliances with operating systems accounting procedures andpolicies at all locations of the Company and report the same to the Audit Committee onquarterly basis.
27. COST AUDITORS AND COST RECORDS
The Company is required to maintain cost records for certain products as specified bythe Central Government under subsection (1) of Section 148 of the Act and accordinglysuch accounts and records are made and maintained in the prescribed manner. However theCompany is not required to appoint the Cost Auditors under the provisions of Section 148of the Act.
28. REMARKS ON QUALIFICATION BY STATUTORY AUDITORS AND SECRETARIAL AUDITORS
There is no qualification / observation/adverse remark in Statutory Auditors' Report.
With respect to observations made by the Secretarial Auditors in their report yourdirectors would like to state that:
1) Delay in filing of some e-forms with the Registrar of Companies was due tooversight; and
2) Delay in processing of one request for transfer/transmission of share and issue ofduplicate share certificates we would like to state that the Company has delivered allequity share certificates within 30 days of receipt thereof lodged for transfersubdivision consolidation renewal exchange as specified under Regulation 40 of the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 except delay in onerequest for transfer of shares which was processed subsequently in accordance with theprocedure and timelines provided under SEBI Circular No. SEBI/HO/MIRSD/D0S3/CIR/P/2018/139dated 6 November 2018.
Further none of the Auditors of the Company have reported any fraud as specified underthe second proviso of Section 143 (12) of the Act.
29. MANAGEMENT DISCUSSION AND ANALYSIS BUSINESS RESPONSIBILITY REPORT AND CORPORATEGOVERNANCE REPORT
Pursuant to Regulations 34(2) & (3) and Schedule V of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 the following have been made part of theAnnual Report and are attached to this Report:
Management Discussion and Analysis Report
Business Responsibility Report
Corporate Governance Report
Declaration on compliance with Code of Conduct
Certificate from Practicing Company Secretary that none of the directors on theBoard of the Company has been debarred or disqualified from being appointed or continuingas directors of companies
Auditors' Certificate regarding compliance of conditions of Corporate Governance
30. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
There was no significant or material order passed by any regulator or court ortribunal which impacts the going concern status of the Company or will have bearing oncompany's operations in future.
31. INTERNAL FINANCIAL CONTROL WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has in place proper and adequate internal control systems commensurate withthe nature of its business size and complexity of its business operations. Internalcontrol systems comprising of policies and procedures are designed to ensure reliabilityof financial reporting compliance with policies procedures applicable laws andregulations and that all assets and resources are acquired economically used efficientlyand adequately protected.
32. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of Section 125 of the Act read with the IEPF Authority(Accounting Audit Transfer and Refund) Rules 2016 (the Rules') all unpaid orunclaimed dividends are required to be transferred by the Company to the IEPF establishedby the Government of India after the completion of seven years. Further according to thesaid Rules the shares on which dividend remained unpaid or unclaimed by the shareholdersfor seven consecutive years or more shall also be transferred to the demat account of theIEPF Authority. Accordingly during the financial year 2019-20 the Company transferred20347 equity shares to the demat account of the IEPF Authority as per the requirements ofthe IEPF Rules for the dividend remained unclaimed / unpaid upto financial years 2011-12.
In terms of the provisions of Section 125 of the Act and said Rules during thefinancial year 2019-20 an amount of Rs 340152/- being remained unpaid / unclaimeddividend for the Financial Year 2011-12 was transferred to the IEPF.
Further the unpaid and unclaimed dividend amount lying with the Company for FinancialYear 2012 - 13 is due to transfer to the IEPF in the month of October 2020. The detailsof the same are available on the Companys' website viz. www.hindcompo.com.
Mr. Vikram Soni Company Secretary and Compliance Officer of the Company is appointedas the Nodal officer to ensure compliance with the IEPF Rules.
33. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
Pursuant to the provisions of Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 details regarding Conservation of Energy TechnologyAbsorption Foreign Exchange earnings and outgo is annexed to this report as "Annexure- F" and forms a part of this Report.
34. CREDIT RATINGS:
Acuite Ratings & Research Limited has reaffirmed the following credit ratings forCompanys' long term and short term instruments:
|Scale ||Amount ||Rating |
| ||(Rs Cr) || |
|Long Term Instruments (fund based) ||7.00 ||ACUITE A- /Stable |
|Short Term Instruments (fund based + non fund based) ||18.00 ||ACUITE A2+ |
|Total ||25.00 || |
35. COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company has devised proper systems to ensure compliance with the provisions of allapplicable Secretarial Standards issued by the Institute of Company Secretaries of Indiaand your directors confirm compliance of the same during the year under review.
36. INFORMATION UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has complied with the provisions relating to the constitution of theInternal Complaints Committee and has constituted an internal complaint committee underSection 4 of The Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013. During the financial year under review there was no complaint filedbefore the said Committee and there was no complaint pending at the beginning or end ofthe financial year under review.
Your Directors would like to place on record their sincere appreciation for thecontinued co-operation guidance support and assistance extended during the year underreport by our bankers customers suppliers and Government agencies. The Board ofDirectors wishes to express its appreciation for the valuable contribution made by theemployees at all levels during the year under report.
| ||For and on bahalf of the Board of Directors |
| ||Raghu Mody |
| ||Chairman |
|Place: Mumbai ||DIN: 00053329 |
|Date: 29 ||June 2020 |