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Hittco Tools Ltd.

BSE: 531661 Sector: Engineering
NSE: N.A. ISIN Code: INE863C01019
BSE 00:00 | 20 Oct 4.38 -0.17
(-3.74%)
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4.65

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4.77

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NSE 05:30 | 01 Jan Hittco Tools Ltd
OPEN 4.65
PREVIOUS CLOSE 4.55
VOLUME 2420
52-Week high 6.12
52-Week low 2.78
P/E
Mkt Cap.(Rs cr) 3
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 4.65
CLOSE 4.55
VOLUME 2420
52-Week high 6.12
52-Week low 2.78
P/E
Mkt Cap.(Rs cr) 3
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Hittco Tools Ltd. (HITTCOTOOLS) - Director Report

Company director report

To

The Members

Your directors have pleasure in presenting the 27th Annual Report of yourCompany together with the Audited Accounts for the year ended 31st March 2021.

FINANCIAL RESULTS:

The summarized financial results for the year are as under:

(Rs. In Lakhs)

Particulars 2020-21 2019-20
INCOME:
Sales 548.55 563.78
Other Income 2.36 10.66
Total (A) 550.90 574.44
EXPENSES:
Cost of Material Consumed 199.17 206.02
Changes in inventories of finished goods work in progress and stock-in-trade (12.23) 22.47
Employee benefit expenses 157.47 157.95
Interest and Financial Charges 37.35 39.19
Other expenses 138.18 162.12
Total (B) 519.94 587.75
Profit before Depreciation and Tax (C) = (A) - (B) 30.96 (13.31)
Depreciation and amortization expenses 52.87 71.42
Profit after Depreciation (21.91) (84.74)
Exceptional items - Net Income / Expenditure 0 0
Profit before Tax (21.91) (84.74)
Provision for Tax 0 .31
Profit for the period from continuing operation (21.91) (85.05)
Other comprehensive income (Re-measurement of defined benefit obligation / Assets) .51 (2.27)
Profit / (Loss) after Depreciation and Tax (21.40) (87.32)
Earnings Per Share (Basic) (.35) (1.45)
Earnings Per Share (Diluted) (.35) (1.45)

OPERATIONS AND BUSINESS PERFORMANCE:

During the year under review the income of the Company decreased to Rs.550.90 lakhsduring the year 2020-21 as against Rs. 574.96 lakhs during the previous year 2019-20. TheExport Sales for the year 2020-21 is Rs. 25.51 lakhs compared to Rs. 25.25 lakhs in theprevious financial year 2019-20. Regarding accountability and governance your companycontinue to ensure an environment of transparency and responsibility while aiming for thehighest standard of corporate governance and trust. There is no change in the nature ofbusiness of the company during the year.

COVID-19:

As per the directives of the Government of India and relevant State Governments andkeeping in mind the paramount need of safety of the employees employees who are attendingthe office have been advised to follow all safety precautions like mandatory wearing ofmask use of hand sanitizer social distancing non-use of air conditioners etc.

EXTRACTS OF ANNUAL RETURN:

In terms of Section 92(3) of the Companies Act 2013 and Rule 12 of the Companies(Management and Administration) Rules 2014 the Annual Return of the Company is availableon the website of the Company at the link:https://www.hittco.com/assets/imq/documents/MGT-9-2021

STATEMENT OF DECLARATION BY INDEPENDENT DIRECTORS:

All the Independent Directors of the Company have given declaration that they meet thecriteria of independence as provided in Sub-Section (6) of Section 149 of the CompaniesAct 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 andthey are not aware of any circumstances 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 Board of Directors have taken on record the declaration and confirmation receivedfrom the Independent Directors and verified the veracity of such disclosures.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The independent directors are regularly updated on the industry and market trendsplants and process and operation performance of the company through presentations in thisregard and periodic plant visit. They are also periodically kept aware of the latestdevelopment in the corporate governance their duties as a director and relevant laws.

NOMINATION & REMUNERATION POLICY:

In adherence to the provisions of Section 134(3) (e) and 178 (1) & (3) of theCompanies Act 2013 the Board of Directors on the recommendation of the Nomination andRemuneration Committee approved the policy to govern the appointment /Nomination ofDirectors KMP and Other Senior Management and their remuneration including criteria fordetermining qualifications positive attributes independence of a director and othermatters provided. There is no change in the Nomination and Remuneration Policy during theyear under review.

CORPORATE GOVERNANCE:

Your Company has a Paid-Up Share Capital of Rs. 615.98 Lakhs and the net worth of Rs.185.68 Lakhs during the financial year ending 31.03.2021. Hence Regulation 27(2) of SEBI(Listing Obligation and Disclosure Requirements) Regulation 2015 are not applicable onthe Company and your Company is not required to report on the Corporate Governance.However your company has made every effort to comply with the provisions of the CorporateGovernance and to see that the interest of the shareholders and the Company are properlyserved.

MANAGEMENT DISCUSSION & ANALYSIS REPORT:

A review of the performance of the Company is provided in the Management Discussion& Analysis Report for the year under review as stipulated under SEBI (LORD)Regulation 2015 is presented in a separate section forming part of the Annual Report andannexed herewith as Annexure 2.

DIVIDEND:

Keeping in view the losses for the year under review the Board of Directors hasdecided not to recommend any dividend for the financial year ended March 31 2021.

TRANSFER TO RESERVES:

The closing balance of the retained earnings of the Company for FY 2021 after allappropriation and adjustments was Rs. (608.38). In view of the loss during the year theBoard of Directors of your Company do not proposes to carry any amount to reserve.

SHARE CAPITAL:

The paid-up Equity Share Capital of the Company as on March 312021 was Rs.61598470/- During the year under review the Company has not issued any shares duringthe period under review.

SUBSIDIARY. JOINT VENTURES AND ASSOCIATE REPORT

During the year under review no company have become or ceased to be company'ssubsidiaries joint ventures or associate companies.

MATERIAL CHANGES AND COMMITMENTS:

There have been no material changes and commitments affecting the financial positionof the company occurring between the end of financial year and the date of the report.

DIRECTORS RESPONSIBILITY STATEMENT:

To the best of their knowledge and based on the guidance and insights from the Auditorsand pursuant to the provisions of sub-section (5) of Section 134 of the Companies Act2013 your Directors confirm that:

i) In the preparation of the annual account for the year ended March 312021 theapplicable accounting standard have been followed along with proper explanation relatingto material departure if any.

ii) Such accounting policies have been selected and applied 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 as on March 31 2021 and of the profit and loss ofthe company for that period;

iii) Proper and sufficient care have been taken for the maintenance of adequateaccounting records in accordance with the provision of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

iv) The financial statements have been prepared on a going concern basis.

v) Proper internal financial controls were in place and the financial controls wereadequate and operating effectively; and

vi) The system to ensure compliance with the provision of all applicable laws were inplace and adequate and operating effectively.

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12):

During the year under review there were no frauds reported by the auditors to theAudit Committee or the Board under Section 143(12) of the Companies Act 2013.

CHANGES IN DIRECTORS:

Appointments

During the year under review the Board of Directors based on the recommendation ofNomination and Remuneration Committee had approved the appointment of Mr. YashvardhanBhandari (holding DIN 06688573) as an Executive Director of the company in the meetingheld on 22.05.2020.

The Shareholders of the Company at their Annual General Meeting held on 25thSeptember 2020 had approved the appointment of Mr. Yashvardhan Bhandari as an executivedirector of the Company.

Resignation

Mr. Rajib Ghosh Roy resigned from the post of whole-time director of the Company w.e.f.22.05.2020.

The Board at its meeting held on 21st May 2020 has accepted hisresignation w.e.f. 22.05.2020 and recorded its appreciation for his valuable contributionduring his tenure on the Board of the Company.

Re-appointment:

In accordance with the provisions of Section 152 of the Companies Act 2013 and Articleof Association Mr. Sidharth Bhandari director of the Company retire by rotation inensuing Annual General Meeting and being eligible offers himself for re-appointment.

CHANGES IN KEY MANAGERIAL PERSONNEL:

During the year under review Miss Huma M Tamatgar resigned from the post of CompanySecretary of the Company w.e.f. 25.06.2020 and Miss. Shalini Kashyap was appointed as theCompany Secretary of the Company w.e.f. 06.07.2020.

Mr. Rajib Ghosh Roy resigned from the post of Chief Financial Officer of the Companyand appointed as Chief Executive Officer w.e.f. 22.05.2020.

Mr. Yashvardhan Bhandari was appointed as Chief Financial Officer of the company by theboard in the meeting held on 22.05.2020.

MEETING OF THE BOARD:

Six meeting of the board of directors were held during the year under review. Detailsof the same are mentioned below:

S. No. Date of Meeting Directors associated as on the date of Meeting Attendance
No. of Director % of attendance
1. 21.05.2020 10 8 80
2 26.06.2020 9 7 78
3. 28.08.2020 9 7 78
4. 15.09.2020 9 9 100
5. 12.11.2020 9 9 100
6. 13.02.2021 9 7 78

Audit Committee:

The composition function and procedure of the Audit Committee and Nomination andRemuneration Committee are in conformity with the requirement of Section 177 & 178 ofthe Companies Act 2013. During the year under review the Board accepted all therecommendation made by the Audit Committee of the Board. The Audit Committee met 5 timesand Nomination and Remuneration Committee met three times in the year under reviewon the following dates:

S. No. Date of Meeting No. of Members associated on the date of Meeting Attendance
No. of Member % of Attendance
1. 21.05.2020 3 3 100
2. 26.06.2020 3 3 100
3. 15.09.2020 3 3 100
4. 12.11.2020 3 3 100
5. 13.02.2021 3 3 100

Nomination and Remuneration Committee:

S. No. Date of Meeting No. of Members associated on the date of Meeting Attendance
No. of Member % of Attendance
1. 21.05.2020 3 3 100
2. 04.07.2020 3 3 100
3. 15.09.2020 3 3 100

PERFORMANCE EVALUATION OF CHAIRMAN DIRECTORS. BOARD AND COMMITTEES:

Pursuant to the provision of Section 134 of the companies Act 2013 and regulation 17of the SEBI (Listing Obligation and Disclosure Requirement) Regulation 2015 the board hascarried out an annual performance Evaluation of its performance the director individuallyas well as the evaluation of its Audit Nomination and Remuneration and Other committee.

The performance of the Board was evaluated by the board after seeking inputs from allthe directors on the basis of factors which includes Active participation financialliteracy contribution by Directors Positive inputs effective deployment knowledge& expertise integrity and maintenance of confidentiality and independence ofbehaviour and judgement. In the meeting of Independent Directors performance ofNon-independent Directors Board and performance of the Chairman was evaluated. Theperformance of independent director was carried out by the entire board.

At the conclusion of the evaluation exercise the members of the Board accessed thatthe Board together with each of its committees was working effectively in performance ofits key functions.

ADEQUACY OF INTERNAL FINANCIAL CONTROLS:

The company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed. Further the testing of suchcontrols was also carried out independently by the statutory and the internal auditor forthe financial year 2020-21. In the opinion of the Board the existing internal controlframework is adequate and commensurate with the size and nature of the business of theCompany. The details in respect of internal financial control and their adequacy areincluded in the management and discussion & analysis report which forms part of thisreport.

AUDITORS AND AUDITORS REPORT:

Statutory Auditors

M/s. DTSB AND ASSOCIATES who were appointed as the Statutory Auditors of the Companyfor a period of five years from the conclusion of Twenty-sixth Annual General Meeting heldon 25th September 2020 have resigned as the Statutory Auditors of the Companyw.e.f. 2nd June 2021 due to lack of human resources caused by Covid 19pandemic. The Board at its meeting held on 14th June 2021 on therecommendation of the Audit Committee accepted the resignation tendered by the StatutoryAuditors and placed on record their appreciation to M/s. DTSB AND ASSOCIATES for theircontribution to the Company with their audit processes and standards of auditing.

Appointment of M/s. Bothra Nirmal Associates pursuant to the provision of Section 139of the Companies Act 2013 the Company was required to fill the casual vacancy caused bythe resignation of M/s. DTSB AND ASSOCIATES as Statutory Auditors of the Company.Accordingly the Board of Directors and Audit Committee have appointed M/s. Bothra NirmalAssociates as Statutory Auditors of the Company to fill the casual vacancy caused due tothe resignation M/s. DTSB AND ASSOCIATES as Statutory Auditors of the Company till theconclusion of 27th Annual General Meeting of the company to be held in the calendar year2021. Considering the varied experience that Bothra Nirmal Associates has gained in thefield of audit assurance and management services your Board is of the view thatcontinuance of M/s Bothra Nirmal Associates Chartered Accountants as Statutory Auditorsof the Company will be beneficial to the Company shareholders and other stakeholders aswell therefore recommends their appointment as the Auditors of the Company for furtherperiod of 5 years from the conclusion of the ensuing 27th Annual General Meeting till theconclusion of 32nd Annual General meeting to be held in the year 2026. M/s.Bothra Nirmal Associates Chartered Accountants have conveyed their consent to beappointed as the Statutory Auditors of the Company along with the requisite confirmationthat their appointment if made by the shareholders would be within the limitsprescribed under the Companies Act 2013. The Auditors' Report to the Shareholders for theyear under review does not contain any qualification reservation or adverse remark ordisclaimer.

Statutory Auditor's Report

Auditor Qualification

Notes to accounts referred to in the Auditor's Report are self - explanatory andtherefore do not call for any further explanation. However the following has not beenrecognized as explained below:

Auditors Comment:

1. The finished goods and work in progress have been valued at estimated cost. We areunable to obtain Sufficient and appropriate audit evidence about approximation of theestimated cost to the actual cost. As Required by the Ind AS - 2 "Inventories"from the records maintained by the company. Consequently we are unable to determine theimpact of the same on the financial statements for the year end 31st March2021.

Director View on Auditor Adverse remark:

The company has maintained proper book of account including inventory and the same hasbeen provided to statutory auditor during the audit. Hence the view of audit qualificationis unnecessary.

2. Balance confirmations have not been received from Trade receivables other financialassets and Other Financial liabilities against balance outstanding as on 31st March 2021.In the absence of such confirmations we are unable to comment on the impact arising outof reconciliation/adjustments if any on the financial statements for the year end 31stMarch 2021.

Director View on Auditor Adverse remark:

The company has maintained proper book of account and same has been provided tostatutory auditor during the audit. Balance confirmations provided to auditor. Hence theview of audit qualification is unnecessary.

3. Confirmation for balances of fixed deposits have not been provided for ourverification. In the absence of such confirmations we are unable to comment on the impactarising out of reconciliation/adjustments if any on the financial statements for theyear end 31st March 2021

Director View on Auditor Adverse remark:

These FDs are closed and have been utilized already. Auditor has not provided anyguidelines for adjustment of the same.

SECRETARIAL AUDITOR AND REPORT:

Secretarial Auditor

The Secretarial Auditors M/s Suraj Parasher & Co. Practising Company Secretarieshas issued Secretarial Audit Report (Form MR-3) for the Financial Year 2020-21 pursuant toSection 204 of the Companies Act 2013 and pursuant to Regulation 24A of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 which is annexed to Directors'Report (Refer Annexure-3).

Secretarial Auditors Report:

The observations in Secretarial audit report are self -explanatory and therefore doesnot call for any further explanation.

COST AUDITORS:

The provision of Section 148(1) does not apply to the Company hence the Company is notrequired to maintain the cost records.

INTERNAL AUDITOR:

The Board has appointed Internal Auditor in compliance with Section 138 of theCompanies Act 2013 and rules made thereunder.

RISK MANAGEMENT:

The Company has a mechanism to identify assess monitor and mitigate various risks toits key business objective. Major risks identified by the business and functions aresystematically addressed through mitigating actions on a continuing basis. However as perthe listing regulation constitution of Risk Management Committee for enforcing RiskManagement Policy is not applicable to the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE:

No significant and material orders were passed by the Regulators or Courts or Tribunalwhich impact the going concern status and future operations of the Company.

There is No application /proceeding pending against the Company under the Insolvencyand Bankruptcy Code 2016.

INDIAN ACCOUNTING STANDARDS. 2015:

The annexed financial statements for the Financial Year 2020-21 and correspondingfigures for 202021 comply in all material aspects with Indian Accounting Standards (IndAS) notified under section 133

of the Companies Act 2013 (the Act) [Companies (Indian Accounting Standards) Rules2015] and other relevant provisions of the Act.

CORPORATE SOCIAL RESPONSIBILITY (CSR):

As the Company does not fall under any of the threshold limits given under Section 135of the Companies Act 2013 the provision of Corporate Social Responsibility is notapplicable to the Company.

CONTRACTS AND ARRANGEMENT WITH RELATED PARTIES:

All related party transaction that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There is no materialcontract or arrangement in accordance with the requirement of SEBI (Listing Obligation andDisclosure Requirement) Regulation 2015.

There is no materially significant related party transactions made by the company withthe Promoter Director Key Managerial Personnel or other designated persons which mayhave a potential conflict with the interest of the company at large. All related partytransaction is placed before the audit committee and given in the notes annexed to andforming part of this financial statement.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The company has a vigil mechanism / Whistle Blower policy to deal with the instance offraud and mismanagement if any. It provides opportunities to the directors employees andany other person dealing with the company to report in good faith to the management aboutthe unethical and improper practices fraud or violation of Company's code of conduct. Thevigil mechanism under the policy also provides for adequate safeguard againstvictimization of employee and directors who use such mechanism and makes provision fordirect access to the Chairman of the Audit Committee in exceptional Cases. The Companyaffirms that none of the personnel of the Company has been denied access to the AuditCommittee.

Further as per the provisions of Regulation 18 (3) of the SEBI (Listing Obligationsand Disclosure Requirements) Regulation 2015 (Listing Regulations) read with Part C ofSchedule II to Listing Regulations the Audit Committee has reviewed the functioning ofwhistle blower mechanism of the Company and found the same satisfactory

PUBLIC DEPOSITS:

During the year under review the Company has not accepted/renewed any deposit from thepublic within the meaning of section 73 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014.

PARTICULARS OF CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION & FOREIGN EXCHANGEEARNINGS AND OUTGO:

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclose under the act are provided inAnnexurel.

PARTICULAR OF LOAN GIVEN. INVESTMENTS MADE. GUARANTEES GIVEN AND SECURITIES PROVIDED:

During the financial year 2020-21 the company has neither made any investment nor givenany loans or guarantee covered under the provision of section 186 of the Companies Act2013.

PERSONNEL RELATIONS:

The Company considers human capital as a critical asset and success factor for smoothorganizational workflow. Your directors hereby place on record their appreciation for theservice rendered by the executives staff and workers of the Company for their hard workdedication and commitment. During the year under review relations between the employeeand the management continued to remain cordial.

PARTICULAR OF EMPLOYEES AND RELATED DISCLOSURE:

No employee of the Company had drawn salary in excess of the limits specified underSection 197(12) of the Companies Act 2013 and the rule 5 of the company (Appointment andRemuneration of managerial personnel) rules 2014 and read with the Companies (Particularsof Employees) Rules 1975.

LISTING ON STOCK EXCHANGE:

The Company's shares are listed on the Bombay Stock Exchanges Mumbai. The Company haspaid the listing fee to the stock exchange for the financial year 2020-21 and has compliedwith all the requirement of the listing regulations.

DISCLOSURE AS REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION.PROHIBITION AND REDRESSED ACT 2013:

Pursuant to the provisions of Section 22 of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 read with Rule 14 the internalcommittee constituted under the said act has confirmed that no complaint / case has beenfiled / pending against the Company during the year.

SECRETARIAL STANDARD:

The Company complies with all applicable mandatory secretarial standard issued by theInstitute of Company Secretaries of India.

CODE OF CONDUCT:

The Company has adopted the code of conduct for all Board members and Senior Managementas required under Regulation 17 of the Listing Regulations. All Board Members and SeniorManagement personnel have affirmed compliance with the code on an annual basis and adeclaration to this effect signed by Mr. Rajib Ghosh Roy CEO of the Company forming partof this report.

CEO/CFO CERTIFICATION:

A certificate duly signed by CEO and CFO relating to financial statements and internalcontrols and internal control systems for financial reporting as per the format providedin Regulation 17(8) of the SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015 was placed before the Board and was taken on record.

CAUTIONARY NOTE:

Statement in this Management Discussion Analysis Report describing the Company'sobjectives projections estimates and expectations may be forward looking statementwithin the meaning of applicable laws and regulation. Actual results may differsubstantially or materially from those expressed or implied. Important development thatcould alter your Company's performance include increase in material costs technologydevelopment and significant changes in political and economic environment tax laws andlabor relations.

ACKNOWLEDGEMENTS:

Your directors would like to place on record their sincere gratitude to theGovernments Financial Institutions and Banks for the assistance co-operation andencouragement received during the year. Your directors also wish to place on record theirsincere appreciation to the Investors for their continuing support Dealers BusinessAssociates and Employees at all levels fortheir unstinting efforts in ensuring excellentperformance.

The Directors regret the loss due to COVID-19 pandemic and are deeply grateful and haveimmense respect for every person who risked their life and safety to fight this pandemic.

For and on behalf of the Board of Directors
HITTCO TOOLS LIMITED
Sd/- Sd/-
(Surendra Bhandari) (Madhu Bhandari)
Managing Director Director
DIN:00727912 DIN:00353298
Place: Bangalore
Date: 20.08.2021

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