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Marine Electricals (India) Ltd.

BSE: 535119 Sector: Engineering
NSE: MARINE ISIN Code: INE01JE01010
BSE 05:30 | 01 Jan Marine Electricals (India) Ltd
NSE 00:00 | 18 Feb 98.05 0.75
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Marine Electricals (India) Ltd. (MARINE) - Director Report

Company director report

To The Members

Marine Electricals (India) Pvt. Ltd.

Your Directors have pleasure in presenting their 11thAnnual Report along with theAudited Accounts of the Company for the year ended 31stMarch 2018.

FINANCIAL RESULTS:

Your company's performance during the year under review as compared to the previousfinancial year is summarised in the following statement:

PERFORMANCE OF THE COMPANY - STANDALONE

Particulars 31st March 2018 (Rs.) 31st March 2017

(Rs.)

Total income 2890708357 2118440491
Expenses 2628440109 1887124032
Profit before interest depreciation and taxation 262267978 231316460
Interest and bank charges 46176283 40196135
Depreciation and Amortization 39196078 43722229
Profit before tax 176895617 147398095
Less: Provision for current tax & deferred tax 59655000 61283933
Profit after taxation 117240617 86114162

PERFORMANCE OF THE COMPANY - CONSOLIDATED

Your Company has availed the exemption provided in the second proviso of Rule 6 ofCompanies (Accounts) Rules 2014 and has thus not consolidated its financial statements.

All the shareholders of your Company have consented to avail this exemption. Furtherthe ultimate holding company of your Company viz KDU Enterprises Private Limited shallfile consolidated financial statements with the Registrar of Companies.

State of Company's Affairs and Future Outlook

Your company has its headquarters in the financial capital of India - Mumbai where italso operates and runs a production facility and has two production facilities at VernaGoa. Your company has undertaken an expansion of manufacturing facilities with setting upof a new facility next to Plant 2 at Verna Goa. The plant is estimate to start commercialproduction by October 2018.

Current year has been challenging year for the Company due to structural changes likeintroduction of Goods and Service Tax implemented by the Government. Industry is expectedto get formalize with many players from unorganized sector likely to get included in mainstream of business. Further global uncertainty has gradually creeped in affecting Indianbusinesses. Your Company is confident to come out of these uncertainties with the focusapproach and with support of global and local vendors and customers.

Company's Performance

The revenue from operations for FY 2017-18 was at Rs. 2876638708/- which was higherby 37.34% compared to the previous year Rs. 2094416945/- in FY 2016-17.

Earnings before interest tax depreciation and amortisation ("EBITDA") isRs.262267978/- registering a growth of 13.38% over EBITDA of Rs. 231316459/- in FY2016-17.

Profit after tax ("PAT") for the year was Rs. 117240617/- recording agrowth of 36.14% over the PAT of Rs. 86114162/- of FY 2016-17.

Dividend

With a view to conserve the resources of the Company your Directors do not recommendany dividend for the financial year ended 31st March 2018.

Details of Subsidiary Joint Venture Associate Companies

Your Company had two subsidiary companies as on 31stMarch 2018. Your Company did nothave any associate companies or joint venture companies within the meaning of section 2(6)of the Companies Act 2013 ("Act").

Marine Electricals FZC (MEFZC) incorporated in Sharjah United Arab Emirates andEltech Engineers Madras Private Limited (EEMPL) which was acquired during the year underreview are the two subsidiary companies.

During the year under review MEFZC has achieved a turnover of Rs.660263577/- (AED36198661/- @ Rs.18.24 per AED) with a profit of Rs.44075537/- (AED 2416422 @ Rs18.24 per AED).

During the year under review EEMPL has achieved a turnover of Rs. 65661559/- with aprofit of Rs. 1280118/-

Pursuant to provisions of section 129(3) of the Companies Act 2013(the Act) astatement containing salient features of the financial statements of the Company'ssubsidiaries in Form AOC-1 is attached to this report and marked as Annexure I.

Amounts Transferred to Reserves

During the year under review an amount of Rs. 41224800/- has been transferred toSecurities Premium Account of the Company.

Changes in Share Capital

During the financial year the paid up share capital of your Company has been increasedfrom Rs. 171782000/- to Rs. 180370500/- pursuant to allotment of 858850 equityshares of Rs. 10/- each at a premium of Rs. 48/- per share under Rights issue.

Disclosure regarding Issue of Equity Shares with Differential Rights

All the equity shares issued by your company carry similar voting rights and yourCompany has not issued any equity shares with differential voting rights during the yearunder review.

Disclosure regarding issue of Employee Stock Options

Your company has not granted any Employee Stock Options during the year under review.

Disclosure regarding issue of Sweat Equity Shares

Your company has not issued any Sweat Equity Sharesduring the year under review.

Quality Initiatives

Your Company has continued its commitment towards the highest levels of qualitybest-in-class service management robust information security practices and maturebusiness continuity processes. Marine Electricals has certified its plants to meet ISO9001:2015 ISO 14001:2015 & OHSAS 18001:2007 to cater to highest levels of safety forits staff and environment.

The Extract of the Annual Return

As provided under section 92(3) of the Act the extract of annual return is given inAnnexure II in the prescribed Form MGT-9 which forms part of this report.

Deposits

The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of thebalance sheet.

Loans from Director's and their Relatives

Your Company has not taken any loan from Directors and their relatives during the yearunder review. Statutory Auditors

The current statutory auditors term has expired and it is proposed to appointSGJ&Co Chartered Accountants as Statutory Auditors for a period of 5 years. They havegiven their eligibility & consent for the proposed appointment.

Auditors' Report

The Auditors report does not contain any qualification reservation or adverse remarkor disclaimer thus no need arises for the Board of Directors to furnish any explanationor comments on the same.

Fraud Reporting

There have been no known instances of Fraud in your company during the year underreview.

Maintenance of Cost Records

Maintenance of cost records as specified by the Central Government under Section 148 ofthe Companies Act 2013 is not applicable to the Company.

Sexual Harassment Policy

The Company has devised a round Sexual Harassment Policy in line with the requirementsof the Sexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal)Act2013 with the proper composition of members.

Vigil Mechanism/Whistle Blower Policy

The Company has established vigil mechanism pursuant to provisions of Section 177(9) ofthe Companies 2013 and oversees it through Mr. Vinay Uchil Director since AuditCommittee is not applicable to the Company The Company has also provided adequatesafeguards against victimization of Company's employees and Directors who express theirconcerns.

Secretarial Standards

Your Board of Directors the management team and professional employed / associatedwith the Company ensure that the necessary compliance with regard to the SecretarialStandards have been complied with.

Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo

Energy conservation continues to be an area of focus for your Company Initiatives tointegrate energy efficiency into overall operations are undertaken through designconsiderations and operational practices.

The details of Energy Technology Absorption Foreign Exchange Earnings and Outgo areas under:

a) Conservation of Energy

Your Company has taken sufficient steps to conserve energy by monitoring the usethereby resulting in savings for the company.

b) Technology Absorption

The Company is using latest technology for manufacturing of the products and same hasbeen fully absorbed. The Company is continuously improving its quality and installedlatest equipment and new testing and measuring equipment. Indigenous technology availableis continuously being upgraded to improve overall performance.

Indigenous technology available is continuously being upgraded to improve over allperformance.

c) Expenditure on Research & Development

Your company has in addition to R&D facility in Mumbai started a R&D facilityin Kochi to increase new product development. We have already designed two new products inthe year which will commercially sold in the next financial year. Also our new team ofvery senior engineers have bought improvements in all our existing products developed bythe company in the past.

d) Foreign Exchange Earnings/ Outgo:

Foreign Exchange Earnings: Rs. 232139995/- Foreign Exchange Outgo : Rs.242693980/-

Corporate Social Responsibility (CSR)

As per the provisions of Section 135 of the Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014 the Board has constituted a CSRCommittee consisting of the following Directors:

1. Mr. Venkatesh K. Uchil - Chairman;
2. Mr. Vinay K. Uchil - Member.

Your Company in the current financial year has contributed Rs660000 to Amrita Trust-a NonGovernment Organization (NGO - registered with the charity commissioner Mumbai). Thetrust aims at providing and promoting healthcare and medical assistance to the weakersections of our society it also provides education and training to the under privilegedand disabled to lead a self-sustained life.

Your company is in the process of identifying more projects in line with the CSRpolicy in order to enable your Company to spend the entire amounts kept aside for the CSRspends. It is because of lack of suitable projects that your Company was unable to spendthe entire amount of CSR during the financial year.

The requisite disclosures to be given with regard to CSR in the prescribed format areannexed as Annexure-III to this report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review Mr. Venkatesh K. Uchil (DIN: 01282671) and Mr. Vinay K.Uchil (DIN: 01276871) continue to be on the Board of your Company. Declaration by anIndependent Director(s)

RECEIPT OF ANY COMMISSION BY MANAGING DIRECTOR/WHOLE TIME DIRECTOR FROM A COMPANY ORFOR RECEIPT OF COMMISSION / REMUNERATION FROM IT HOLDING OR SUBSIDIARY

The Managing Director of the Company viz. Mr. Venkatesh K Uchil did not receive anycommission from a Company or from it's holding / subsidiary company.

DECLARATION BY AN INDEPENDENT DIRECTOR(S)

Your Company being a private limited company the provisions with regards to theappointment of Independent Directors pursuant to section 149(4) do not apply to yourCompany.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

Twenty-Four Board meetings were held during the year as follows

Sr. No. Date of Board Meeting Name of the Directors who attended the sai meeting
1. 12th April 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
2. 19th April 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
3. 12th June 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
4. 21st June 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
5. 7th July 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
6. 21st July 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
7. 10th Aug2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
8. 7th September 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
9. 9th September 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
10. 18th September 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
11. 29th September 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
12. 25th October 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
13. 30th October 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
14. 7th November 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
15. 8th November 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
16. 9th November 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
17. 13th November 2017 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
18. 8th January 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
19. 25th January 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
20. 26th February 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
21. 1st March 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
22. 16th March 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
23 17th March 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )
24 24th March 2018 Vinay K Uchil (DIN: 01276871 ) Venkatesh K Uchil (DIN: 01282671 )

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:

Your Company has not given any loans guarantees not made any investments and notgiven any security to any other body corporate falling under the purview of Section 186 ofthe Companies Act 2013.

The details of the investments made by your company during the year under reviewfalling under the ambit of Section186 of the Companies Act 2013 were as under :-

Date of Investment Details of Investee Amount Date of BR
02/08/17 Eltech

Engineers

Madras

Private

Limited

210000 17/2/2017

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

All the contracts or arrangement entered into by the Company during the financial yearwith related parties were in the ordinary course of business and at arm's length thus thesame were outside the purview of Section 188(1)of the Companies Act 2013and hence nodetails have been provided in AOC2.

RISK AND CONCERNS

Risks and concerns as follows:

There could be possibility of your Company may not be unable to meet certain deliveryobligations including timelines of delivery due to which it could become liable toclaims by customers suffer adverse publicity and incur substantial costs which in turncould adversely affect the results of operations of the Company.

Business may suffer if the Company fails to keep pace with rapid changes in technologyand the industries on which it focuses.

Products are being manufactured from manufacturing facilities located in the Mumbai andGoa. Any disruption or suspension in the production process in this facility cansignificantly impact Company's ability to service customer needs.

If Company fails to keep technical knowledge and process know-how confidential it maysuffer a loss of competitive advantage.

The Company's business is not of continuous production in nature thus resulting invaried results for different operating periods as well as Balance Sheet situations.

RISK MANAGEMENT POLICY

The Board of Directors and the team of professionals employed by the Company in variousdepartments constantly review the risk management of the Company and ensure itseffectiveness. The finance team has an additional oversight in the area of financial risksand controls. Major risks identified by the businesses and functions are systematicallyaddressed through mitigating actions on a continuing basis.

However the Company has not faced any risk which in the opinion of the Board maythreaten the existence of the company

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:

No significant and material orders have been passed by any regulator or courts ortribunals which shall impact the going concern status and operations of your Company infuture.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to sub-section 5 of Section 134 of the Companies Act 2013 the Directorsconfirm that:

a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to 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 this Act for safeguarding theassets 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; and

e) the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

The details in respect of adequacy of internal financial controls with reference to theFinancial Statements have been mentioned subsequently in this report.

f) the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

THE DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THEFINANCIAL STATEMENTS

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation was observed.

PERSONNEL

Relation between employees and management continued to be cordial during the year. YourCompany considers its employees as its most valuable asset. The Company continues itsfocus on employee retention. The Company's performance-driven culture with a strong focuson employees' career aspirations appreciation and total-welfare helped maintain an idealemployee strength.

The Marine family consists of 307 number of employees. On gender diversity the Companyhas 10% of women employees including senior positions.

PARTICULAR OF EMPLOYEES

There were no employee who receive remuneration more than Rupees One Crore Two Lacs asper Section 197 read with rule 5(3) of the Companies (Appointment & Remuneration ofManagerial Personnel) Rule 2014 during the period under the review hence no disclosureshave been given.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONREDRESSAL) ACT 2013

The Company is committed to provide a safe and conducive work environment to itsemployees.

Your Directors further state that during the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.

ACKNOWLEDGEMENTS

The Directors thank the Company's employees customers vendors investors bankers andacademic institutions for their continuous support.

The Directors also thank the Governments of various countries Government of India andvarious government departments / agencies for their co-operation

The Directors appreciate and value the contributions made by every member of the Marinefamily.

On behalf of the board of directors

VENKATESH K. UCHIL Managing Director DIN:01282671 Date: 26th July 2018 Place: Mumbai VINAY K. UCHIL

Director

DIN: 01276871