Jamna Auto Industries Ltd.
|BSE: 520051||Sector: Auto|
|NSE: JAMNAAUTO||ISIN Code: INE039C01032|
|BSE 00:00 | 24 Sep||90.30||
|NSE 00:00 | 24 Sep||90.50||
|Mkt Cap.(Rs cr)||3,598|
|Mkt Cap.(Rs cr)||3598.45|
Jamna Auto Industries Ltd. (JAMNAAUTO) - Director Report
Company director report
The Directors have pleasure in presenting the 52nd Annual Report and AuditedFinancial Statements for the financial year ended March 31 2018.
Financial Results-An Overview
(Rs. in crore)
Year 2017-18 turned out to be a good year for the domestic Commercial Vehicle (CV)segment. In the beginning of the FY 2018 the CV segment saw initial hiccups when themarket was transiting to BS IV emission norms. From the beginning of second quarter of theFY 2018 the CV segment led by truck segment has been on a recovery phase aided by higherdemand post GST implementation stricter implementation of overloading norms. Overall CVsegment grew at around 16% YoY.
The Company's topline observed a growth as consolidated revenue rose to Rs. 1740 crorecompared to Rs. 1292 crore in previous year. The consolidated PBT stood at Rs. 186 croreas compared to Rs. 145 crore in the previous year. In OE segment the Company continues tobe a market leader in the multi-leaf springs and parabolic springs with 72% OEM marketshares in India. Company's lift axles have continue to get a good response from customers.The Company also palns to come out with new products i.e. Stablizer Bar U-Bolt andTrailer Suspension in near future.
The after market segment is a core area of focus for the Company specially postimplementation of GST. The Company expands its distribution network in India and abroadand
adopted new branding and marketing strategies. The Company has launched the "JAIVistar" initiative with loyalty programs for mechanics - "Jai Ho" schemeretailers - "Jai Sarathi" scheme and distributors - "Jai Rising Star"scheme. Currently more than 10000 mechanics and their families are being benefitted bythe "Jai Ho" scheme. The Company has a very strong PAN India after-marketnetwork comprising of 11 depots 300+ distributors and 6000+ retailers supplying 5000+parts and catering to 10000+ mechanics. In order to promote the ease of doing businesssupply chain system has been integrated with a state-of-the-art ERP system.
The Company serves its customers from its plants situated all across India. During theyear under review Yamuna Nagar and Malanpur Plants have been awarded the esteemed TPMExcellence Category A' award. Company's focus to adopt best quality and servicepractices in manufacturing process to deliver quality products. The Company plans tocontinue to expand its manufacturing footprints by setting up further two plants one atPithampur near Indore Madhya Pradesh and other at Adityapur near Jamshedpur Jharkhand.
During the year under review The ICRA has maintained Company's long term rating at AA-and short term rating at A1+ with positive outlook. The rating of A1+ has been assigned tothe commercial papers issued by the Company.
The Company has moved a step closer to achieve the internal target in terms ofProject Lakshya'. A detailed discussion on the operations and performance for theyear is given in the Management Discussion and Analysis (MDA) section in the annualreport. For details members are requested to please see MDA section.
There has been no change in the nature of business of the Company during the year underreview. During the period under review and till the date of last reporting no suchmaterial changes/commitments have taken place as to affect the financial position of theCompany.
An interim dividend of Rs.0.30 per equity share of Rs.1/- each was declared and paidduring the FY 2017-18. In addition the Directors are pleased to recommend for yourconsideration a final dividend of Rs 0.55/- per equity share of Rs.1/- each. Payment offinal dividend will be made subject to approval of the members of the Company at theensuing Annual General Meeting. With the payment of final dividend the total dividendpayment for the FY 2017-18 would be Rs 0.85 per equity share of Rs.1 each.
Transfer to Reserves
The Company has not transferred any amount to the General Reserves for the FY endedMarch 31 2018.
During the year under review your Company has not invited or accepted/renewed anyfixed deposits from public under
Section 73 of the Companies Act 2013 read with Companies (Acceptance of Deposits)Rules 2014.
Energy Conservation Technology Absorption & Foreign Exchange
In accordance with the requirements of Section 134(3) (m) of the Companies Act 2013read with Rule 8(3) of the Companies (Accounts)Rules 2014 a statement showingparticulars with respect to Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo is annexed hereto as Annexure-1 and form an integral part ofthis report.
Risk Management Policy
One of the major aim of the project Lakshya is to de-risk the Company from marketoperational and other risks. The Company has established a three layer framework for riskidentification evaluation control minimization and control. The Company also has a riskmanagement policy in place. Risk management policy of the Company is available at thewebsite of the Company at www.jaispring.com .
Vigil Mechanism / Whistle Blower
The Company has implemented whistleblower policy to deal with any fraud irregularityor mismanagement in the Company. The policy enables any employee or director to directlycommunicate to the Chairman of the Audit Committee to report any fraud irregularity ormismanagement in the Company. The policy ensures strict confidentiality while dealing withconcerns and also that no discrimination or victimization is meted out to anywhistleblower. The policy is also hosted on the website of the Company atwww.jaispring.com .
Corporate Social Responsibility (CSR)
Diligently discharging its social responsibility is a part of Company's core strategy.As a responsible organization focused on inclusive growth the Company emphasizes onenvironment conservation and sustainability promotion of education promotion of sportsand community outreach as per the CSR Policy of the Company. In recognition to ourcontribution to CSR World CSR Day & World Sustainability Forum awarded the Company asone among the "100 most impactful CSR leaders" of the year in their globallisting. The Company is also a receipent of "Social Footprints - National CSR Awards& Summit 2018 for Excellent Value Added to the local Community" conferred by CMAI& CIM Global in Vigyan Bhawan Delhi.
The details about the CSR policy and initiatives taken by the Company on CSR during theyear are available at the website of the Company at www.jaispring.com . The Annual Reporton CSR activities undertaken by the Company during the year under review is annexed heretoas Annexure-2 and form an integral part of this report.
Directors and Key Managerial Personnel
Total strength of the Board of Directors is 9 consisting of 5 Independent Directors 3Executive Directors and 1 NonExecutive Director. The Composition of the Board is inconformity with the Companies Act 2013 and Regulation 17 of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015.
Mr. B. S. Jauhar non-executive director is the Chairman of the Board of Directors ofthe Company. Mr. R. S. Jauhar is the Executive Vice-Chairman and Mr. P.S. Jauhar is theManaging Director & CEO. During the year under review Mr. H.S. Gujral an ExecutiveDirector resigned from the Board of Directors with effect from February 13 2018. Mr.S.P.S. Kohli has been inducted as an Executive Director on the Board with effect fromFebruary 13 2018. By virtue of cessation of Mr. H.S. Gujral and induction of Mr. S.P.S.Kohli as Executive Director the total strength of Board remains same. All the executivedirectors are appointed by the Board for a fixed term normally of three years onrecommendation of the Nomination & Remuneration Committee of the Board subject toapproval by members of the Company.
Mr. S.P.S. Kohli has been initially inducted as an Additional Director on the Board.The approval of members of the Company is being sought for his appointment as Whole TimeDirector designated as an Executive Director on the Board of Directors of the Company. Theresolution for appointment of Mr. S.P.S. Kohli and payment of remuneration to him shall beplaced before the members for their approval at the ensuing Annual General Meeting of theCompany. His appointment is appropriate and in the best interest of the Company.
Mr. J. K. Jain Mr. U. K. Singhal Mr. Shashi Bhushan Bansal Mr. Rakesh Kalra and Ms.Payal Chawla are the 5 independent directors on the Board of Directors of the Company. Allthe independent directors are appointed for a period of five years and are not liable toretire by rotation.
The executive directors are paid monthly remuneration and commission on the profits ofthe Company as per the terms of their appointment. Non-executive directors are paidsitting fee for attending meetings of the Board and Committee thereof. The Nomination& Remuneration Committee reviews and makes recommendations of the appointment andremuneration of the executive directors. The Policy relating to remuneration of Directorsforms an integral part of this report and is attached as Annexure-3. The policy is alsoavailable on the website of the Company at www.jaispring.com .
The Nomination & Remuneration Committee and the Board of Directors have recommendedthe re-appointment of Mr. P. S. Jauhar as Managing Director & CEO of the Company for afurther period of 3 years with effect from August 01 2018 to July 31 2021.The resolutionfor re-appointment of Mr. P. S. Jauhar and payment of remuneration to him shall be placedbefore the members for their approval at the ensuing Annual General Meeting of theCompany. His re-appointment is appropriate and in the best interest of the Company.
During the year under review four meetings of the Board of Directors of the Companywere held on May 20 2017 August 12 2017 November 11 2017 and February 13 2018respectively. The complete details about the Board's strength attendance and remunerationof directors is given under Corporate Governance Report which forms an integral part ofthis Annual Report.
The Company has received declaration from all the independent directors stating thatthey continue to meet the criteria of independence laid down under Section 149(7) of
the Companies Act 2013 and Regulation 25 of SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015. Further all the Directors have confirmed that they havecomplied with the Company's code of conduct.
In compliance with the provisions of Section 152 of the Companies Act 2013 read withthe Articles of Association of the Company Mr. P S Jauhar Director of the Company willretire at the ensuing Annual General Meeting and being eligible has offered himself forreappointment. The Board recommends his re-appointment.
The brief profile of the Directors who are proposed to be appointed / re-appointed arefurnished in the notice of 52nd Annual General Meeting. The Board recommends appointment/re-appointments of above said directors.
Related party transactions entered into by the Company during the year under reviewwere in the ordinary course of business at arm's length pricing basis in accordance withCompany's policy on Related Party Transactions. The policy is also available on thewebsite of the Company at www.jaispring.com . Prior approval of the Audit Committee Boardof Directors and the members of the Company as the case may be is also taken for relatedparty transactions. Details of the transactions with related parties entered into by theCompany are also periodically placed before the Audit Committee and the Board ofDirectors. Form AOC-2 for disclosure of particulars of contracts/ arrangements enteredinto by the Company with related parties referred to in Section 188 of the Companies Act2013 is annexed hereto as Annexure-4 and forms an integral part of this report.
Extract of Annual Return
The extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-5 andform an integral part of this report.
At JAI it's about the people behind the scenes. We have worked hard to create adedicated team having long term commitment to deliver results. Your Company continues toenjoy cordial relationships with the employees and work force across all units andestablishments.
During the year under review the Company's equity shares of face value of Rs.5 eachsplitted into equity share of face value of Rs.1 each with effect from October 06 2017.The Equity Shares of your Company continue to be listed at National Stock Exchange ofIndia Limited and Bombay Stock Exchange Limited. The Company has paid the Listing Fees forFY 2018-19 to the Stock Exchanges.
The Company has not issued any sweat equity shares or equity shares with differentialvoting rights hence there are no information required to be furnished in terms ofprovisions of Rule 4(4) and Rule 8(13) of the Companies (Share Capital and Debenture)Rules 2014.
In compliance with the provisions of Companies Act 2013 SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015 and SEBI (Share Based Employee Benefits)Regulations
2014 the particulars with regard to employs stock options as on March 31 2018 areannexed as Annexure-6 and forms an integral part of this report.
During the year Company has got registration of its trademarks "JAI" and" JPSL" in Russian Federation. Company has already got registration of itstrademark "JPSL" in Republic of Bangladesh whereas trademark "JAI" isunder process. Company is also under process of getting registration of its trademarks"JAI" & "JPSL' in Nepal. Company's application for granting IndianPatent for Air Suspension is pending before the Indian Patent Authorities. Company iscopyright holder of more than 75 designs of Leaf and Parabolic spring.
The Company lays strong emphasis on transparency accountability and integrity in itsplans policies and procedures. The Company adheres to accomplish the timely compliancesas may be required from time to time under the provisions of Companies Act 2013 SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015. The Company ensuresthe compliances of applicable Secretarial Standards from time to time.
Pursuant to the requirements of Regulation 33 of the SEBI (Listing Obligations andDisclosure Requirements) Regulations
2015 the report on corporate governance regarding compliance of conditions ofcorporate governance is set out at Annexure-7 as separate section and forms an integralpart of this report. The certificate of the Statutory Auditors confirming compliance withthe conditions of the SEBI Listing Regulations is also attached thereto. The certificatedoes not contain any qualification reservation or adverse remarks.
Pursuant to Regulation 34 & Regulation 43A of SEBI (Listing Obligations &Disclosures Requirement) Regulations 2015 the Company is covered in list of top 500Companies as per the data of stock exchanges as on March 31 2018 the BusinessResponsibility Report is applicable on the Company for the financial year ending on March31 2019.
Auditors and Auditors' Report Statutory Auditors
Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rulesframed thereunder the tenure of M/s S. R. Batliboi & Co; LLP Chartered Accountants asstatutory auditors of the Company shall expire at the conclusion of the 52nd AnnualGeneral Meeting of the Company. M/s S.
R. Batliboi & Co; LLP Chartered Accountants have expressed their willingness andeligibility to be re-appointed as statutory auditors of the Company. Board of Directorshas recommended the re-appointment of M/s S. R. Batliboi & Co; LLP CharteredAccountants as Statutory Auditors at the ensuing Annual General Meeting for a furtherperiod of 5 year subject to the approval of members of the Company. The resolution forapproval of re-appointment is being sought in the 52nd Annual General Meeting.
The report of the statutory auditors read with notes on accounts are self-explanatoryand do not call for any further comments.
The Auditors' Report does not contain any qualification reservation or adverseremarks.
M/s K J & Associates Company Secretaries who were appointed to conduct SecretarialAudit for the financial year ended March 31 2018 have submitted their secretarial auditreport. The report does not contain any qualification reservation or adverse remarks. Thereport of the Secretarial Auditors for the FY ended March 31 2018 is annexed asAnnexure-8 and forms an integral part of this report.
In compliance with the provisions of Section 204 of the Companies Act 2013 and Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard has re-appointed M/s K J & Associates Company Secretaries to conductSecretarial Audit for the financial year ending March 31 2019.
M/s Jangira & Associates Cost Accountants are proposed to be re-appointed as costauditors of the Company for the FY 2018-19 pursuant to the requirements of Section 148 ofthe Companies Act 2013. The cost audit report of the FY 201718 would be filed with theCentral Government within the prescribed time. The remuneration payable to the CostAuditor is being sought for approval by the members of the Company in the ensuing AnnualGeneral Meeting.
The Company has a wholly owned subsidiary namely Jai Suspensions Limited. During theyear under review the subsidiary company has not started its business activity. TheCompany is also a majority partner in Jai Suspension Systems LLP.
Pursuant to the provisions of Section 136 of the Companies Act 2013 read withapplicable rules made thereunder the consolidated financial statements of the Companyforms part of the Annual Report. A statement containing the salient features of thefinancial statement of the subsidiary in the Form AOC-1 is attached with the financialstatements of the Company.
Management Discussion & Analysis
Management Discussion & Analysis Report is set out as separate section of theAnnual Report.
Particulars of Loans Guarantees or Investments
Particulars of loans guarantees and investments covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statements.
Material Changes and Commitment
There were no material changes and commitments affecting the financial position of theCompany between the end of FY 2017-18 i.e. March 31 2018 and the date of this Report.There are no significant material orders passed by the Regulators or Courts or Tribunalsimpacting the going concern status of the Company and its future operations.
Particulars of Employees
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 and Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed as Annexure-9 and forms anintegral part of this report.
As per the provisions of Section 136(1) of the Companies Act 2013 the Report and theAccounts are being sent to all the members of the Company excluding the informationrequired under Section 197(12) of the Companies Act 2013 read with Rule 5(2) and 5(3) ofCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Any memberinterested in obtaining such information may write to the Company Secretary at theRegistered Office. The said information is also available for inspection at the RegisteredOffice during working hours up to the date of ensuing Annual General Meeting.
Internal Financial Control
In accordance with the provisions of Section 134(5) (e) of the Companies Act 2013your Company has duly adopted policies and procedures to ensure orderly and efficientconduct of its business including adherence to Company's policies the safeguarding ofits assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation.
Disclosure under Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013
The Company recognizes its responsibility to provide a safe working environment forwomen free from sexual harassment and discrimination. In line with the Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013 the Company hasconstituted a Sexual Harassment Committees at plants and other locations for preventionand redressal of complaints of sexual harassment and for the matters connected therewith.There were no cases/complaints pertaining to the sexual harassment reported to theCommittee during the period under review.
Transfer of amount to Investor Education and Protection Fund
During the Financial Year 2017-18 the unclaimed interim dividend of financial year2010-11 was due and transferred to Investor Education and Protection fund in accordancewith the provisions of Companies Act 2013 read with Investor Education and ProtectionFund Authority (Accounting Audit Transfer and Refund) Rules 2016 ("IEPFRules"). The Company has uploaded the details of unpaid and unclaimed dividends lyingwith the Company for subsequent years on the web site of the Company at www.jaispring.com.
As per the requirements of IEPF Rules the securities on which dividend remainsunclaimed for consecutive seven years were liable to transfer to demat account of IEPFAuthority. In complying with the requirements the equity shares on which
dividend remains unclaimed for consecutive seven years has been transferred to IEPFAuthority. The detailed list of shareholders whose shares has been transferred to IEPF hasbeen hosted on the website of the Company at www.jaispring . com.
Directors' Responsibility Statement
Pursuant to Section 134 (3) (c) of the Companies Act 2013 the Board of Directors tothe best of their knowledge and ability confirm that:
a) in preparation of the annual accounts of financial year ended March 31 2018 theapplicable accounting standards have been followed along with proper explanation relatingto material departures.
b) the directors had 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 and loss of the company for that period.
c) the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.
d) the directors had prepared the annual accounts on a going concern basis.
e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and operating effectively.
f) the directors had devised proper systems to ensure compliance of the provisions ofall applicable laws and that such systems were adequate and operating effectively.
The Directors place on record their appreciation for assistance and co-operationreceived from various ministries and department of Government of India and other StateGovernments financial institutions banks shareholders directors executives officersof the Company etc. The management would also like to express great appreciation for thecommitment and contribution of its employees at all locations.
For and on behalf of the Board of Directors
Place: New Delhi
(B. S. Jauhar)
Date: May 22 2018