The Directors present their forty-fifth (45th) Annual Report and Audited FinancialStatements for the year ended 31 March 2020.
During the year under review pursuant to the Order passed by Hon'ble Supreme Court ofIndia on 9 January 2019 Western Maharashtra Development Corporation Ltd. (WMDC) one ofthe promoters of the Company transferred its entire 27% stake in the Company to BajajHoldings and Investment Ltd. (BHIL) the other promoter on 17 June 2019. Consequent tothis transaction WMDC ceased to be the promoter of the Company and the shareholding ofBHIL which was already holding 24% stake increased to 51%. As a result BHIL became theholding Company and this Company became its subsidiary. This transaction however had nosignificant impact on the finances or operations of the Company. Upon cessation of WMDC asa promoter of the Company the protocol agreement entered into by WMDC and BHIL the jointpromoters in 1975 having becoming infructuous was terminated with mutual consent.
Review of operations
During the year under review the business operations of the Company continued to be(i) manufacture of die casting dies fixtures and die casting components primarily meantfor the automobiles industry and (ii) treasury operations involving management of surplusfunds invested by the Company.
The turnover of the Company during the year under review was Rs 21383.00 lakh asagainst Rs 9592.52 lakh during the previous year. Income from investments aggregating toRs 19561.90 lakh represented major portion of the turnover which during the previousyear was Rs 7728.82 lakh.
Continued classification as a Core Investment Company
The Company continued to meet the conditions for being classified as a Core InvestmentCompany exempted from registration with Reserve Bank of India pursuant to the provisionsof section 45-1A of the RBI Act 1934.
|Particulars ||FY2020 ||FY2019 |
|Gross sales and other income ||21383.00 ||9592.52 |
|Gross profit before depreciation ||19361.51 ||7595.07 |
|Depreciation ||181.55 ||155.21 |
|Profit before tax ||19179.96 ||7439.86 |
|Tax expenses ||1185.69 ||159.84 |
|Profit after tax ||17994.27 ||7280.02 |
|Earnings per share ( Rs ) ||157.45 ||63.70 |
The Board at its meeting held on 21 February 2020 declared an interim dividend of Rs 50per equity share (500%) for the year ended 31 March 2020 which was paid to all theeligible shareholders on 9 March 2020. The amount of dividend including tax thereon was Rs6888.87 lakh.
The directors recommend for consideration of the shareholders at the ensuing annualgeneral meeting the above-referred interim dividend as final dividend for the financialyear ended 31 March 2020.
For the financial year ended 31 March 2019 the Company had paid a dividend of Rs 33per share (330%).
The paid-up equity share capital as on 31 March 2020 was Rs 11.43 crore. During theyear under review there was no public issue rights issue bonus issue or preferenceshare issue nor had the Company issued shares with differential voting rights or grantedstock options or sweat equity.
Presentation of financial statements
The financial statements of the Company for the year ended 31 March 2020 have beendisclosed as per Division ll of Schedule III to the Companies Act 2013 (the Act').
Cash flow statement
A Cash Flow Statement for the year 2019-20 is included in the annexed Statement ofAccounts.
The extract of annual return as provided under section 92(3) of the Act in theprescribed form MGT-9 is annexed to this Report and also displayed on the Company'swebsite i.e. www.mahascooters.com
Number of meetings of the Board
Six (6) meetings of the Board were held during the financial year. Details of themeetings and attendance thereat form a part of the Corporate Governance Report.
Directors' Responsibility Statement
As required pursuant to clause (c) of sub-section (3) of section 134 and in complianceof section 134(5) of the Act the directors to the best of their knowledge and beliefstate that -
(a) in the preparation of the annual accounts the applicable Accounting Standards hadbeen followed along with proper explanation relating to material departure;
(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 for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(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 were adequate and were operatingeffectively; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Details in respect of frauds if any reported by the Auditors
During the year under review no frauds were reported by the auditors to the AuditCommittee or the Board under section 143(12) of the Act.
Declaration given by Independent Directors
The Independent Directors have submitted declaration of independence as required undersection 149(7) of the Act stating that they meet the criteria of independence as providedin section 149(6) of the Act as amended and Regulation 16 of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 (the SEBI ListingRegulations') as amended.
The Board took on record the declaration and confirmation submitted by the IndependentDirectors regarding their meeting the prescribed criteria of independence afterundertaking due assessment of the veracity of the same as required under Regulation 25 ofthe SEBI Listing Regulations.
The Ministry of Corporate Affairs vide its circular dated 22 October 2019 furtheramended the Companies (Appointment and Qualification of Directors) Rules 2014 byrequiring an Independent Director to apply online within 1 May 2020 to the Institute ofCorporate Affairs for inclusion of his/her name in the data bank for such period tillhe/she continues to hold office of an independent director in any company. The IndependentDirectors were also required to submit a declaration of compliance in this regard. All theIndependent Directors of the Company have submitted the declaration with respect to thesame.
Policy on Director's appointment and remuneration
Information regarding Directors' Remuneration Policy and criteria for determining thequalification positive attributes independence of a director and other matters providedunder sub-section (3) of section 178 of the Act are contained in the Corporate GovernanceReport. The said policy is also hosted on the website of the Company: www.mahascooters.com
Particulars of loans guarantees and investments
The Company has not given any loans or provided any security. Full particulars of theinvestments covered under the provisions of section 186 of the Act made by the Companyare detailed in the Financial Statements attached to this Report.
Particulars of contracts and arrangements with related parties
During the year under review transactions with related parties were entered with theapproval of the Audit Committee in line with provisions of the Act and the SEBI ListingRegulations.
All related party transactions entered into during FY 2019-20 were on an arm's lengthbasis and in the ordinary course of business under the Act and not material' underthe Listing Regulations. None of the transactions required members' prior approval underthe Act or the SEBI Listing Regulations. During FY 2019-20 there were no related partytransactions requiring disclosure under section 134 of the Act.
There being no such contract with related parties which are material' in naturethere are no details to be disclosed in Form AOC-2 under the Act.
Pursuant to Regulation 23 of the SEBI Listing Regulations the Board at its meetingheld on 15 May 2019 has revised the policy on materiality of related party transactionsand on dealing with related party transactions including clear threshold limits forvarious transactions with related parties. The said policy is hosted on the website of thecompany: www.mahascooters.com
Details pursuant to Rule 8(3) of the Companies (Accounts) Rules 2014
|Conservation of energy ||The Company continued to maintain power factor to unity throughout the year resulting in availing maximum rebate in electricity bills. Replacement of LED lamps/tubes all over the factory has also contributed to saving in electricity. |
|Technology absorption ||No expenditure was incurred by the Company attributable to technology absorption during the year. |
|Expenditure on Research & Development ||No expenditure was incurred by the Company attributable to Research & Development during the year. |
|Foreign exchange earnings and Outgo ||The Company did not earn any foreign exchange while the outgo was Rs 146.20 lakh. |
Annual evaluation of the performance of the Board its Committees and Directors
Information on the manner in which formal annual evaluation has been made by the Boardof its own performance and that of its Committees and individual directors is given in theCorporate Governance Report.
Directors and Key Managerial Personnel
(i) Withdrawal of Nominations by Western Maharashtra Development Corporation Ltd.(WMDC) and Bajaj Holdings & Investment Ltd. (BHIL)
During the year under review WMDC has withdrawn the nomination of Abhinandan More andVishwanath L Rajale as its Nominee Directors on the Board of the Company with effect from3 July 2019. BHIL has also withdrawn the nomination of Madhur Bajaj as its NomineeDirector on the Board of the Company with effect from 3 July 2019. In his place SanjivBajaj was elevated as Chairman of the Company with effect from 4 July 2019. The boardrecorded its appreciation of the valuable services rendered by the outgoing Directors andin particular of the role played by the outgoing Chairman Madhur Bajaj during theirtenure in the Board.
(ii) Resignation of Independent Directors
During the year under review Sadashiv S. Survase Sanjay S. Degaonkar and VrushaliAgashe on account of change in the management of the Company tendered their resignationsas Independent Directors effective 3 July 2019.
(iii) Appointment of Directors
The Board at its meeting held on 24 July 2019 based on the recommendation of theNomination and Remuneration Committee appointed Mrs. Lila Poonawalla as an Independentdirector w.e.f. 25 July 2019 for a term of five consecutive years subject to approval ofshareholders at the general meeting. The shareholders by way of Special Resolution passedthrough a Postal Ballot exercise on 9 September 2019 approved the appointment of Mrs.Lila Poonawalla as an Independent Director with effect from 25 July 2019 and hercontinuation as such on account of her attaining the age of 75 years on 16 September 2019pursuant to Regulation 17(1A) of SEBI Listing Regulations.
The Board at the aforesaid meeting also appointed V. Rajagopalan and Anish P. Amin asadditional and Non-Executive Directors effective 25 July 2019 subject to approval ofshareholders at the general meeting.
(iv) Re-appointment of Independent Directors
The Board on 15 November 2019 by way of circular Resolution re-appointed Yogesh J.Shah & Naresh Patni as Independent directors effective from 13 October 2019 for aperiod of five years subject to approval of shareholders at the general meeting aftertaking into account the report of performance evaluation and the recommendation ofNomination and Remuneration Committee. The shareholders by way of Special Resolutionpassed through a Postal Ballot exercise approved on 22 December 2019 the afore-mentionedappointments effective from 13 October 2019 and also for continuation of Naresh Patni asIndependent Director beyond 13 May 2024 on account of his attaining the age of 75 years onthat date.
The Board is of the opinion that Mrs. Lila Poonawalla Yogesh J Shah and Naresh Patnihave the necessary experience and expertise concerning the business of the Company. Basedon the declarations submitted by them the Board is also of the opinion that they possessthe integrity to be appointed as Independent Directors of the Company.
(v) Director liable to retire by rotation
In due compliance of the provisions of the Act Sanjiv Bajaj (DIN: 00014615) retires byrotation as a director and being eligible offers himself for re-appointment and is to beappointed as a Director not liable to retire by rotation..
Changes in KMP:
A. Chief Financial Officer
Anant Marathe was appointed as Chief Financial Officer of the Company effective 1 July2019 in place of R.B. Laddha who had superannuated from the services effective 30 June2019.
Anant Marathe also acts as CFO of Bajaj Holdings & Investment Ltd. the holdingcompany.
B. Company Secretary
N.S. Kulkarni Company Secretary aged about 66 years would be retiring on 30 June2020 after being in the service of the company for about 43 years.
Considering above Sriram Subbramaniam would be appointed as Company Secretary of yourCompany effective 1 July 2020.
Sriram Subbramaniam also acts as Company Secretary of Bajaj Holdings & InvestmentLtd. the holding company.
During the year under review your Company has carried out 4 Postal Ballot exercisesdetails of which are given in the Corporate Governance Report.
Significant and material orders passed by the Regulators or Courts
During the year under review there were no significant and material orders passed bythe regulators or courts or tribunals which may impact the going concern status of theCompany and its operations in future.
Towards the end of March 2020 many of the States/Union Territories across the countryin view of the heightened concern over the spread of Corona Virus (COVID-19")issued directives inter-alia to facilitate work from home for majority of its employees.In line with the lockdowns announced by the Central Government all offices of the Companywere closed from 23 March 2020 providing employees facility to "Work from Home"to ensure continuity of operations of the Company. The said closure(s) have adverselyaffected the operations of the Company and the impact of the same cannot be assessed atthis point of time. However this does not affect the going concern status of the Company.
Adequacy of internal financial controls with reference to the financial statements
The Company has documented its internal financial controls considering the essentialcomponents of various critical processes physical and operational. This includes itsdesign implementation and maintenance along with periodical internal review ofoperational effectiveness and sustenance which are commensurate with the nature of itsbusiness and the size and complexity of its operations.
This ensures orderly and efficient conduct of its business including adherence toCompany's policies safeguarding of its assets prevention of errors accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation.
The internal financial controls with reference to the financial statements wereadequate and operating effectively.
Risk Management Policy
Information on the development and implementation of a Risk Management Policy for theCompany including identification therein of elements of risk which in the opinion of theBoard may threaten the existence of the Company is given in the Corporate GovernanceReport.
Material changes and commitments
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company andthe date of this report.
Pursuant to the SEBI Listing Regulations a separate chapter titled CorporateGovernance' has been included in this Annual Report along with the reports on ManagementDiscussion and Analysis and General Shareholder Information.
All the Board members and Senior Management personnel have affirmed compliance with theCode of Conduct for the year 2019-20. A declaration to this effect signed by the CEO ofthe Company is contained in this Annual Report.
The Chief Executive Officer and the Chief Financial Officer have certified to the Boardwith regard to the financial statements and other matters as required under regulation17(8) of the SEBI Listing Regulations.
Certificate from the statutory auditors of the Company regarding compliance ofconditions of corporate governance is annexed to this Report.
Business Responsibility Report
Pursuant to the provisions of the SEBI Listing Regulations the Company is required togive Business Responsibility Report (BRR') in the Annual Report.
As a part of green initiative the BRR for financial year 2019-20 has been placed onthe Company's website at www.mahascooters.com
A copy of the BRR will be made available to any member on request by email.
Pursuant to the provisions of section 204 of the Act and Rules made thereunder theCompany has re-appointed Shyamprasad D Limaye Practising Company Secretary (FCS No.1587 CP No. 572) to undertake the secretarial audit of the Company. Secretarial auditreport for the financial year 2019-20 as issued by him in the prescribed form MR-3 isannexed to this Report.
The said secretarial audit report does not contain any qualification reservation oradverse remark or disclaimer made by the secretarial auditor.
In addition to the above and pursuant to SEBI circular dated 8 February 2019 a reporton secretarial compliance by Shyamprasad D Limaye for the financial year ended 31 March2020 is being submitted to stock exchanges. There are no observations reservations orqualifications in the said report.
Secretarial Standards of ICSI
Pursuant to the approval given on 10 April 2015 by Central Govt. to the SecretarialStandards specified by the Institute of Company Secretaries of India the SecretarialStandards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) cameinto effect from 1 July 2015. These Secretarial Standards were subsequently revisedeffective from 1 October 2017. Your Company is in compliance with the said Standards.
Statutory Auditor and Auditors' Report
Pursuant to the provisions of section 139 of the Act the members at the Annual GeneralMeeting of the Company held on 18 July 2017 had appointed Kirtane & Pandit LLPChartered Accountants (Firm Registration No. 105215W/W100057) as statutory auditors of theCompany from the conclusion of 42nd Annual General Meeting till the conclusion of 47thAnnual General Meeting covering a term of five consecutive years.
The statutory audit report for the year 2019-20 does not contain any qualificationreservation or adverse remark or disclaimer made by statutory auditor.
During the year under review the industrial relations remained cordial and a new wageagreement was entered by the Company with workers union valid through 31 March 2023.
Details of Directors and Employees remuneration
Details as required under the provisions of section 197(12) of the Act read with rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended are annexed to this Report.
Details as required under the provisions of section 197(12) of the Act read with rule5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as amended which form part of the Directors' Report will be made availableto any member on request as per provisions of section 136(1) of the said Act.
Internal complaints committee
The Company has a policy on prevention of sexual harassment at the workplace. TheCompany has complied with the provisions relating to the constitution of InternalComplaints Committee under Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. There was no case reported during the year underreview under the said Policy.
Corporate Social Responsibility (CSR)
Detailed information on Corporate Social Responsibility Policy developed andimplemented by the Company on CSR initiatives taken during the year pursuant to section135 of the Act is given in the annual report on CSR activities annexed to this report.
The Board of Directors would like to express its gratitude and its appreciation for thesupport and cooperation from its members authorities regulators and banks.
The Board of Directors also places on record its sincere appreciation of the commitmentand hard work put in by the Management and the employees of the Company and thank them foryet another excellent year.
On behalf of the Board of Directors