Your Directors have pleasure in presenting the 37th (Thirty seventh)Annual Report on the business and operations of the Company together with the auditedfinancial statements for the financial year ended March 31 2022.
(Amount Rs in Million)
|Particulars ||Standalone ||Consolidated |
|31.03.2022 ||31.03.2021 ||31.03.2022 ||31.03.2021 || |
|1 Income || || || || |
|(a) Revenue from operations ||27348 ||22888 ||29759 ||23679 |
|(b) Other income ||463 ||303 ||242 ||332 |
|Total income ||27811 ||23191 ||30001 ||24011 |
|2 Profit from operation before Interest Depreciation Other Expenses taxes and share of profit/ (loss) of joint ventures/associate ||6201 ||5056 ||6500 ||5259 |
|3 Finance costs ||305 ||358 ||309 ||358 |
|4 Depreciation and amortization expense ||1028 ||897 ||1120 ||936 |
|5 Other expenses ||3088 ||2666 ||3313 ||2757 |
|6 Exceptional Income ||- ||- ||327 ||- |
|7 Profit from continuing operations before share of profit of joint ventures/ associate and taxes ||1780 ||1135 ||2085 ||1208 |
|8 Share of profits of joint ventures/associate (net of taxes) ||- ||- ||74 ||39 |
|9 Profit from continuing operations before income tax ||1780 ||1135 ||2159 ||1247 |
|10 Tax expense || || || || |
|(a) Current tax ||463 ||322 ||547 ||327 |
|(b) Deferred tax ||(66) ||(17) ||(90) ||(15) |
|(c) Tax adjustments related to earlier years ||(219) ||(7) ||(217) ||0 |
|Total tax expense ||178 ||298 ||240 ||312 |
|11 Profit from continuing operations ||1602 ||837 ||1919 ||935 |
|12 Loss from discontinued operations before exceptional item and income tax ||- ||- ||- ||9 |
|13 Exceptional item ||- ||- ||- ||(416) |
|14 Loss from discontinued operations (before tax) ||- ||- ||- ||(407) |
|15 Tax expense related to discontinued operations ||- ||- ||- ||- |
|16 Loss from discontinued operations (after tax) ||- ||- ||- ||(407) |
|17 Profit/(loss) for the year ||1602 ||837 ||1919 ||528 |
|18 Other comprehensive income || || || || |
|(a) Items that will not be reclassified subsequently to profit or loss || || || || |
|-Remeasurement of defined benefit liabilities ||(8) ||- ||(4) ||3 |
|-Income tax relating to items that will not be reclassified subsequently to profit or loss ||2 ||- ||1 ||(1) |
|Share of remeasurement of defined benefit liabilities (net of tax) of an associate and joint ventures ||- ||- ||1 ||3 |
|-Net other comprehensive income not to be reclassified subsequently to profit or loss ||(6) ||- ||(2) ||5 |
|(b) Items that will be reclassified subsequently to profit or loss || || || || |
|-Exchange Difference in translating financial statement of continuing foreign operations ||- ||- ||31 ||39 |
|-Exchange Difference in translating financial statement of discontinued foreign Operations ||- ||- ||- ||368 |
|-Net other comprehensive income to be reclassified subsequently to profit or loss ||- ||- ||- ||407 |
|19 Other comprehensive income for the year (net of tax) ||(6) ||- ||29 ||412 |
|20 Total comprehensive income for the year ||1596 ||837 ||1948 ||940 |
The financial statements have been prepared as per the IND-ASprescribed by the Institute of Chartered Accountants of India (ICAI).
Standalone Financials: During the year under review your Company hasachieved a turnover of Rs 27348 Million against Rs 22888 Million during previous yearregistering a growth of 19.5%.
The Company has reported a Profit of Rs 1602 Million as against Profitof Rs 837 Million during previous year with an increase of 91.4% over the previous year.FY 22 standalone profit includes exceptional income of Rs 219 Million on account ofreversal of tax provision in respect of certain expenses of discontinued business inearlier years considered as disallowed while recognizing tax expenses in the books ofaccounts in earlier years on a conservative basis and dividend income of Rs 198 Million.
Consolidated Financials: During the year under review your Company hasachieved a consolidated turnover of Rs 29759 Million against Rs 23679 Million duringprevious year registering a growth of 25.7%.
The Company reported a Profit of Rs 1919 Million from continuingoperations as against Profit of Rs 935 Million earned during previous year with anincrease of 105.2% over the previous year. FY 22 consolidated profit includes anexceptional income of Rs 327 Million on account of fair valuation of MindaInstruments Limited (Formerly known as Minda Stoneridge Instruments Limited) and anexceptional income of Rs 217 Million on account of reversal of tax provision in respect ofcertain expenses of discontinued business in earlier years considered as disallowed whilerecognizing tax expenses in the books of accounts in earlier years on a conservativebasis.
The Board of Directors of your Company has recommended a final dividendof Rs 0.70 per share (i.e. @ 35%) on 239079428 Equity Shares of Rs 2/- each fully paidup for the year ended March 31 2022. The dividend proposal is subject to the approval ofmembers at the ensuing Annual General Meeting scheduled to be held on July 28 2022. Thisis in addition to the interim dividend of Rs 0.30/- (i.e. @ 15%) per equity share declaredby the Board in its meeting held on February 04 2022. The total dividend for FY 22aggregates to Rs 1/- (i.e @ 50%) per equity share as against Rs 0.65 per share (i.e. @32.5%) per equity share paid for the last year.
DIVIDEND DISTRIBUTION POLICY
In line with Regulation 43A of SEBI (Listing Obligations and DisclosureRequirements) (Second Amendment) Regulations 2016 your Company has formulated a DividendDistribution Policy which is available at the Company's website i.e. https://sparkminda.com/wp-content/uploads/2020/04/Dividend-Policy.pdf
Acquisition of entire stake in Minda Instruments Limited (Formerlyknown as Minda Stoneridge Instruments Limited) to strengthen core business and expandtechnical collaboration with Stoneridge Inc USA
During the year under review your Company has acquired balance equitystake of 49% in Minda Instruments Limited ("MIL") (Formerly known as MindaStoneridge Instruments Limited). Therefore MIL has become wholly owned subsidiary of theCompany w.e.f. December 31 2021. Your company has signed Termination Agreement SharePurchase Agreement and Technical Assistance and License Agreement with Stoneridge Inc.U.S.A. Minda Corporation has increased stake in Minda Stoneridge to strengthen its corebusiness. The acquisition will be value accretive for shareholders as financialperformance of group will strengthen. Your Company will continue to have perpetual licenseof all existing technology licenses granted by Stoneridge Inc and continue TechnicalCollaboration with Stoneridge Inc for future products. This initiative has been taken inline with our vision to grow in advanced technological products i.e. Sensors &Clusters.
Acquisition of equity from Stoneridge Inc. in MIL will provide thefollowing benefits to your Company: -
Flexibility to enter into partnerships/collaboration with otherplayers for advanced technology in clusters and Sensors.
Enable Company to do line by line consolidation of financials ofTarget Company.
Better utilization of funds/cash and overall ROCE accretive toCompany
Free access to highly growing global market of clusters andsensors.
Continuation of Technical relationship with Stoneridge Inc. USA
Joint ventures with Infac Elecs co. Ltd Republic of Korea
During the year under review your Company has entered into and signeda Joint Venture Agreement with Infac Elecs co. Ltd Republic of Korea on June 08 2021 formanufacturing of Antenna for automotive vehicles. This JV is now operational throughincorporation of a new joint venture entity i.e. Minda Infac Private Limited (JV Company)whose main object is to design develop manufacture install assemble produceconceptualize test service distribute market promote offer and sell (either bywholesale or retail) the Shark Fin Antenna -Micro Pole Antenna LF Antenna & SwitchAssembly GPS Antenna Advance Antenna (Products) in India. Presently JV has exclusiverights for Indian Territory. JV company was incorporated on 10th day of August 2021. Theratio of shareholding in the said JV Company is 51:49 held by Minda Corporation Limitedand Infac Elecs Co Ltd Republic of Korea respectively. The paid-up share capital of MindaInfac Private Limited is INR 50000000 (Rupees Five Crores Only) as on March 31 2022.The said JV company is being managed jointly by both the parties through the Board ofdirectors consisting of (2) two directors nominated by each party. The rational and theexpected benefits from this joint venture are as under:
Benefits of combined intelligence
Expertise of Shared Knowledge
Rewarding experience from diverse markets.
The partnership aims to capitalize on the opportunities forgrowth in automotive safety connected & autonomous technologies. Connectivity-basedsafety features such as remote keyless entry V2V & V2X communication will spur demandfor devices like antennas products and solutions. The joint venture will offer multipleAntenna products like Rod Antenna Micro Pole Antenna Shark Fin Antenna LF Antenna etc.
The joint venture will manufacture the antennas locally from thenewly set up state-of-the-art manufacturing unit in Pune.
Acquisition of equity stake in EVQPoint Solutions Private Limited
During the year under review Minda Corporation Limited through itswholly owned subsidiary Spark Minda Green Mobility Systems Private Limited has enteredinto definitive agreements with EVQPoint Solutions Private Limited (EVQPOINT) foracquiring equity stake in charging solutions startup EVQPOINT.
EVQPOINT is an Indian Start-Up founded in 2019. EVQPOINT provides smartelectric vehicle charging products and solutions indigenously designed and developed tomeet the growing needs of eMobility market in India and worldwide. EVQPOINT is a one-stopsolution for electric vehicle portable chargers DC fast chargers and smart chargingstations integrated with charge management system mobile app and interoperable tools.EVQPOINT caters to needs of Electric Vehicle-OEMS Battery-OEMs and establishment ofvehicle charging networks for fleets workplaces homes commercial complexes and anyurban infrastructure such as educational institutions hospitals and public parking lots.
The investment will see Spark Minda Group become EVQPOINT'sexclusive technology and manufacturing partner for battery chargers and EV supplyequipment. This strategic partnership will position Spark Minda to capitalize on theaccelerating shift to electric mobility and further bolster its position as a one stopshop for comprehensive charging solutions for EVs including fast charging feature. As onMarch 31 2022 Spark Minda Green Mobility Solutions holds 29.55% Equity Stake as on March31 2022. Mr. Aakash Minda has been appointed as non-executive director on the Board ofEVQPOINT.
The auto component industry remains cautiously optimistic for thegrowth of the industry in the last fiscal year despite concerns of another wave of thepandemic. Despite resurgence of demand for vehicles supply-side issues of availability ofsemiconductors increasing input costs rising logistics costs and availability ofcontainers among others continue to hamper recovery in the automotive sector. The autocomponent industry against this backdrop displayed remarkable resilience. Increasedvalue-addition to meet regulatory compliance fast recovery in external markets andtraction in the domestic aftermarket have contributed to the growth of the sector.
Industry and the government walk as partners in the story ofdevelopment. Upholding this very sentiment the government presented a story of growth inits Union Budget for FY23 with a slew of measures and plans to push industrial growth inIndia giving it the edge to walk tall among global economies. The year 2022 stands at theprecipice of change for the entire automotive industry across the globe with disruptionvisible across quarters. The India picture in this is one of technological andinfrastructure growth.
As the industry looks to move beyond the impact of COVID-19 someconcerns remain over subsequent mutations of the virus along with the ongoing shortage ofsemiconductors and fluctuating input costs. The positives however outweigh thenegatives as we look at the year with cautious optimism.
The shift in demand away from diesel and petrol to electric vehicles isclear. To mitigate air pollution and climate change several countries in Europe havebanned the sale of new diesel vehicles and implemented generous tax incentives for the useof electric vehicles.
IMPACT OF COVID-19
The COVID-19 epidemic has pushed the global economy and humanity into adisaster. In the attempt to control this pandemic the governments of various countrieshave imposed a nationwide lockdown. Although the lockdown may have assisted in limitingthe spread of the disease it has brutally affected the country unsettling completevalue-chains of most important industries. The epidemic is having a foremost impact on allfeatures of industries which includes the automobile sector with key manufactures eithercompletely close following the orders passed by local governments or running anorganization with least staff at manufacture units to remain their personnel secure. Overthe last 2 years the automobile field had already undergone significant delay due tostructural modification openings with the goods and services tax axle-load reforms shiftto shared mobility liquidity crunch and so on industries had faced major effect.Extended truncation of customer demand due to the lockdown is observed drasticallydistressing auto manufacturers. The majority of the companies are starving the support ofR&D (Research and development) to maintain core functions and potentially getting backthe growth made on mobility technologies as well as alternate fuels. The factors such ashousehold income travel vulnerabilities and epidemic severity in local regions haveinfluenced the purchase decision making process of individuals.
Post Lockdown as the number of COVID-19 cases were reduced andlaunching of Corona Virus vaccine your Company ramped up the operations with strictadherence to safety protocols.
The Company has issued safety guidelines for its employees and workers.
- All safety protocol related to COVID-19 as advised by the governmentare already implemented and being followed.
- Detailed shop-floor precautions & safety systems have beenimplemented with appropriate training to staff and workmen.
- Regular Fumigation of offices and shop floors is being carried out.
- Social distancing norms being strictly followed at factories andoffices.
- Sanitization and thermal screening of employees truck drivers otherentrants and sanitization of loading vehicles at the entry gate of factories.
- Bus Transports were being used with 50% capacity to ensure distanceamong passengers in its Offices.
- All working area is hygienic. Sanitizer & soaps in sufficientquantity at all common points.
- No Physical Meeting - Use VC Teams for meeting
- Roaster and Work from home depending on severity of cases in thecities where we operate
India Ratings & Research (Ind-Ra) and CRISIL have assigned belowcredit ratings to the Company:
|Rating Agencies ||Instrument ||Ratings |
|India Ratings & Research ||Term Loan ||IND AA-/Stable |
| ||(Fund-based and Non-fund-based) Working ||IND AA-/Stable |
| ||Capital Limits || |
|CRISIL ||Long-term Rating ||CRISIL A+/positive |
| ||Short- term Rating ||CRISIL A1+ |
India Ratings & Research (Ind-Ra) have re-affirmed the creditrating during the year under review whereas CRISIL has changed the outlook to Positivefrom Stable while maintaining the Long-Term Rating to A+. Crisil has upgraded the Ratingof Short Term from CRISIL A1 to CRISIL A1+.
The paid-up Equity Share Capital as on 31st March 2022 is Rs 478158856/-(Rupees Four Hundred Seventy-Eight Million One Hundred Fifty-Eight Thousand and EightHundred Fifty-Six Only) divided into Rs 239079428/- (Rupees Two Hundred Thirty-NineMillion Seventy-Nine Thousand Four Hundred Twenty-Eight Only) Equity Share of Rs 2/- each.The authorized share capital of the Company is to an aggregate amount of (Rupees OneThousand Five Hundred Seventy Seven Million Only) and the authorized share capital of theCompany has been re-classified as divided into 692500000 (Six Hundred Ninety Two Millionand Five Hundred Thousand only) equity shares of Rs 2/- (Rupees Two only) each aggregatingto Rs 1385000000/- (Rupees One Thousand Three Hundred Eighty Five Million Only) and240000 preference shares of Rs 800/- (Rupees Eight Hundred only) each aggregating to Rs192000000/- (Rupees One Hundred Ninety Two Million Only).
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the applicable provisions of the Companies Act 2013 readwith the IEPF Authority (Accounting Audit Transfer and Refund) Rules 2016 ("theIEPF Rules") all unpaid or unclaimed dividends are required to be transferred by theCompany to the IEPF established by the Government of India after the completion of sevenyears. Further according to the IEPF Rules the shares on which dividend has not beenpaid or claimed by the shareholders for seven consecutive years or more shall also betransferred to the demat account of the IEPF Authority. During the year under review theCompany has transferred the unclaimed dividend of Rs 22 442 (Twenty-Two ThousandFour Hundred and Forty-Two Rupees Only) along with 11221 (Eleven Thousand Two Hundred andTwenty-One) equity shares for the year 2013-14 and the unclaimed dividend (interim) of Rs35826.80 (Rupees Thirty-Five Thousand Eight Hundred Twenty-Six Rupees and Eighty PaisaOnly) along with 20 (Twenty) equity shares for the year 2014-15 to IEPF Authority.Year-wise amounts of unpaid / unclaimed dividends transferred to IEPF and thecorresponding shares is provided in the Shareholder Information Section of CorporateGovernance Report and are also available on Company's website at www.sparkminda.com.
The details of the nodal officer appointed by the Company under theprovisions of IEPF Rules are available on the website of the Company i.e.www.sparkminda.com.
EMPLOYEE STOCK OPTION SCHEME 2017
Your Company with the objective of introducing a long-term incentivetool to attract motivate retain talent and reward loyalty formulated Minda CorporationLimited Employee Stock Option Scheme 2017 ("ESOP 2017") for grant of a maximumof 5341840 stock options to the eligible employees of the Company. Nomination andRemuneration Committee of the Company has granted total 4040000 stock options to theeligible employees of Minda Corporation Limited and its subsidiaries. A certificate fromthe secretarial auditors of the Company that the Scheme has been implemented in accordancewith the applicable SEBI Guidelines and the resolution passed by Members would be placedat the Annual General Meeting for inspection by Members. There is no material change inthe scheme the same follows the applicable regulations. The necessary disclosure pursuantto Regulation 14 of the SEBI (Share Based Employee Benefits and sweat equity) Regulations2021 with regard to Employee Stock Option Scheme of the Company is available atCompany's website i.e. www.sparkminda.com.
The Company has neither invited nor accepted any deposits from thepublic falling within the preview of section 73 of the Act read with the Companies(Acceptance of Deposits) Rule 2014 during the year. There is no unclaimed or unpaiddeposit lying with the Company.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report (MD&A) for theyear under review as stipulated under Regulation 34 of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 is presentedin a separate section forming part of this Annual Report.
Your Company follows the highest standards of Corporate Governance bestpractices. It adheres to and has implemented the requirements set out by SEBI'sCorporate Governance norms. A separate section on Corporate Governance forms a part of theDirectors' Report.
A certificate confirming the compliance of conditions of CorporateGovernance as stipulated in SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 from Ranjeet Pandey & Associates Practicing Company Secretaries isforming part of the Annual Report.
BUSINESS RESPONSIBILITY REPORT
As stipulated under Regulation 34 of SEBI (Listing obligations anddisclosure requirements) Regulations 2015 the Business Responsibility Report describingthe initiatives taken by the Company from environmental social and governance perspectiveforms part of this Annual Report.
CONSOLIDATED FINANCIAL STATEMENT
In accordance with the Companies Act 2013 ("the Act") andIndian Accounting Standard (Ind AS) 110 on Consolidated Financial Statements read with IndAS 28 investment in associate and joint ventures and Ind AS 112 on disclosure of interestin other entities the audited consolidated financial statement is provided in the AnnualReport.
The performance of the Company on consolidated basis is also discussedat length in the Management Discussion and Analysis which forms part of this DirectorsReport.
DIRECTORS / KEY MANAGERIAL PERSONNEL- APPOINTMENT RE-APPOINTMENT &RESIGNATION
In accordance with the provisions of the Companies Act 2013 andArticles of Association of the Company Mr. Aakash Minda (DIN: 06870774) and Mr. NareshKumar Modi (DIN 00089536) Directors of the Company retire by rotation and being eligibleoffer themselves for re-appointment.
Mr. Ashok Minda (DIN: 00054727) has been appointed as Chairman &Group CEO of the Company w.e.f August 01 2022 for a period of 3 (Three) years asrecommended by the Nomination & Remuneration Committee and approved by the Board ofDirectors in their meeting held on May 17 2022 subject to the approval by shareholders ofthe Company.
The approval of shareholders is being obtained for his reappointment atthe forthcoming Annual General Meeting of the Company by way of Special Resolution.
The Board of Directors in their meeting held on August 12 2019 hasdesignated Mr. Avinash Parkash Gandhi as the Lead Independent Director of the Company. Therole of the Lead Independent Director is available on the Company's websitehttps://sparkminda.com/wp-content/uploads/2022/04/Role-of-Lead-Indepenent-Director.pdf
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have given declarations to the effect thatthey meet the criteria of independence as laid down under Section 149(6) of the CompaniesAct 2013 read with Regulation 16 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. In the opinion of the Board Independent Directors fulfilthe conditions specified in the Act Rules made there under and Listing Regulations.
A formal evaluation of the performance of the Board it'sCommittees the Chairman and the individual Directors was carried out for FY 2021-22pursuant to the corporate governance requirements as prescribed in the Companies Act 2013and the Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 Led by the Nomination & Remuneration Committee. Theevaluation was carried out using individual questionnaires covering amongst otherscomposition of Board conduct as per company values & beliefs contribution towardsdevelopment of the strategy & business plan risk management receipt of regularinputs and information codes & policies for strengthening governance functioningperformance & structure of Board Committees skill set knowledge & expertise ofDirectors preparation & contribution at Board meetings leadership etc.
Further the Committees were evaluated in terms of receipt ofappropriate material for agenda topics in advance with right information and insights toenable them to perform their duties effectively updating to the Board on keydevelopments major recommendations & action plans stakeholder engagement devotingsufficient time & attention on its key focus areas with open impartial &meaningful participation and adequate deliberations before approving importanttransactions & decisions. The performance evaluation of the respective Committees andthat of Independent and Non-Independent Directors was done by the Board excluding theDirector being evaluated. The actions emerging from the Board evaluation process werecollated and presented before the Chairman of Nomination and Remuneration Committee aswell as the Board. Suggestions/feedback concerning strategic governance and operationalmatters are actioned upon by the team.
As part of the evaluation process the performance of non-independentdirectors performance of the Board as a whole performance of the Committee(s) of theBoard and the performance of the Chairman was evaluated by the Independent Directors in aseparate meeting of independent directors held on March 16 2022 considering the views ofother directors.
BOARD AND COMMITTEE MEETINGS
During the year under review 8 (eight) Board Meetings 6 (six) AuditCommittee Meetings were convened and held apart from other Committee's meetings ofthe Company. The details of all the meetings are given in the Corporate Governance Report.The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013.
The calendar of Board and Committee Meetings were prepared andcirculated in advance to the Directors.
COMMITTEES OF THE BOARD
As on March 31 2022 there are 7 (seven) Committees of the Board viz:Audit Committee Nomination and Remuneration Committee Stakeholder RelationshipCommittee Corporate Social Responsibility & Sustainability Committee Risk ManagementCommittee Executive Committee and Securities Issue Committee. A detailed note on thecomposition of the Board and its Committees is provided in the Corporate Governance Reportsection of this Annual Report.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
Pursuant to the provisions of section 134(3)(e) and Section 178(3) ofthe Companies Act 2013 and the SEBI Listing Regulations the policy of the Company onDirectors' appointment and remuneration including the criteria for determiningqualification positive attributes independence of directors and other matters like BoardDiversity are given on the website of the Company athttps://sparkminda.com/wp-content/uploads/2020/04/Nomination-Remuneration-and-Board-Diversity-Policy.pdf
The salient features of the Remuneration and Board Diversity Policy areas under:
a) To determine remuneration of Directors KMP other senior managementpersonnel and other employees keeping in view all relevant factors including industrytrends and practices.
b) If in any financial year the Company has no profits or its profitsare inadequate the Company shall pay remuneration to its Whole-time Director inaccordance with the provisions of Schedule V and other applicable provisions.
c) To guide the Board in relation to appointment and removal ofDirectors Key Managerial Personnel and Senior Management.
d) To evaluate the performance of the members of the Board and providenecessary report to the Board for further evaluation of the Board.
e) To recommend to the Board on Remuneration payable to the DirectorsKey Managerial Personnel and Senior Management.
f) To retain motivate and promote talent and to ensure long termsustainability of talented managerial persons and create competitive advantage.
g) To provide to Key Managerial Personnel and Senior Management rewardlinked directly to their effort performance dedication and achievement relating to theCompany's operations.
h) The remuneration / compensation / commission etc. to the Whole-timeDirector KMPs and Senior Management Personnel will be determined by the Committee andrecommended to the Board for approval. The remuneration / compensation / commission etc.shall be subject to the prior/ post approval of the shareholders of the Company andCentral Government wherever required.
i) The remuneration and commission to be paid to the Whole-timeDirector shall be in accordance with the percentage / slabs / conditions laid down in theArticles of Association of the Company and as per the provisions of the Act. Theloans/advances to employees shall be in accordance with the conditions of serviceapplicable to employees and are also in accordance with the Group Human Resource Policy.
j) Increments to the existing remuneration/ compensation structure maybe recommended by the Committee to the Board which should be within the slabs approved bythe Shareholders in the case of Whole-time Director.
k) Where any insurance is taken by the Company on behalf of itsWhole-time Director Chief Executive Officer Chief Financial Officer the CompanySecretary and any other employees for indemnifying them against any liability the premiumpaid on such insurance shall not be treated as part of the remuneration payable to anysuch personnel.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(5) of the Companies Act2013 with respect to Directors' Responsibility Statement your Directors confirmthat:
a) In the preparation of the annual accounts the applicable accountingstandards have been followed and no material departure was made for the same. Thefinancial statements of the Company for the financial year ended March 31 2022 have beenprepared in accordance with Ind AS as prescribed under Section 133 of the Companies Act2013 (the "Act") read with the relevant rules made thereunder and otheraccounting principles generally accepted in India;
b) Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for the period ended on March 31 2022;
c) Directors have taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
d) The annual financial statements have been prepared on a goingconcern basis;
e) Proper internal financial controls were in place and that thefinancial controls were adequate and were operating effectively;
f) Proper systems had been devised to ensure compliance with theprovisions of all applicable laws and were adequate and operating effectively.
NATURE OF BUSINESS
There has been no change in the nature of business of your Companyduring the year under review.
CODE OF CONDUCT
The Company has in place a comprehensive Code of Conduct ("theCode") applicable to Directors Independent Directors and Senior ManagementPersonnel. The Code gives guidance and support needed for ethical conduct of business andcompliance of law. A copy of the Code is available on the Company's website at thelink: https://sparkminda.com/wp-content/uploads/2020/04/ Code-of-Conduct.pdf. The Chairman& Group CEO of the Company has given a declaration that the member of Board ofDirectors and Senior Management Personnel have affirmed compliance with the code ofconduct of the Board of directors and Senior Management in terms of Schedule V (D) of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015.
TRANSFER TO RESERVES
During the financial year under review there was no transfer to GeneralReserve by the Company.
RELATED PARTY TRANSACTIONS
All Related Party Transactions that were entered into during thefinancial year ended on March 31 2022 were on an arm's length basis and in theordinary course of business under Section 188(1) of the Act and the Listing Regulations.Details of the transactions with Related Parties are provided in the accompanyingfinancial statements note no. 2.40 of Standalone Financial Statement & 2.39 ofConsolidated Financial Statement) in compliance with the provision of Section 134(3)(h) ofthe Act. The policy on Related Party Transactions as approved by the Board may be accessedon the Company's website at the link:https://sparkminda.com/wp-content/uploads/2022/02/Annexure-XII-Related_Party_ Transactions_Policy.pdf
PARTICULARS OF INVESTMENTS MADE LOANS GIVEN GUARANTEES GIVEN ANDSECURITIES PROVIDED
Pursuant to Section 134(3)(g) of the Companies Act 2013 particulars ofloans guarantees or investments and securities provided under Section 186 of theCompanies Act 2013 along with the purpose for which the loan or guarantee or security isproposed to be utilized by the recipient are provided in the standalone financialstatement (Please refer to Note 2.39 A for contingent liability 2.4 and 2.5 to theStandalone Financial Statements & 2.37 for contingent liability 2.4 to ConsolidatedFinancial Statments).
CORPORATE SOCIAL RESPONSIBILITY
Your Company has the policy of giving back to the society and hascarried a host of CSR activities this year. In line with the requirement of Section 135 ofthe Companies Act 2013 your Company having a Corporate Social Responsibility &Sustainability Committee. The details of Committee are provided in Corporate GovernanceReport. The CSR Policy of the Company is available on its website at the link: Spark MindaFoundation (A wholly owned subsidiary of the Company) a non-profit Company registeredunder Section 8 of the Companies Act 2013 is the implementing agency for implementationof CSR activities. A robust system of reporting and monitoring has been put in place toensure effective implementation of planned CSR initiatives. During the year the Companyhas spent Rs 38.62 Million on CSR activities through its implementing agency as perannexed herewith at Annexure-I to this report.
A detailed discussion on CSR Projects and initiatives are included as aseparate section in the Annual Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
Theinformationonconservationofenergytechnologyabsorption and foreignexchange earnings and outgo as stipulated under Section 134(3)(m) of the Companies Act2013 read with Rule 8 of The Companies (Accounts) Rules 2014 is annexed herewith atAnnexure-II to this Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The percentage increase in remuneration ratio of remuneration of eachdirector and Key Managerial Personnel (KMP) (as required under the Companies Act 2013) tothe median of employees' remuneration as required under Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is given at Annexure-III to this Report.
The statement containing particulars of employees as required underSection 197(12) of the Companies Act 2013 read with Rule 5(2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is provided in aseparate exhibit forming part of this report and is available on the website of theCompany.
The Annual Report and accounts are being sent to the shareholdersexcluding the aforesaid exhibit. Shareholders interested in obtaining this information mayaccess the same from the Company website or send a written request to the Company email@example.com.
In accordance with Section 136 of the Companies Act 2013 this exhibitis available for inspection by shareholders at the website of the Company and at theRegistered Office of the Company during business hours on all working days 21 days beforethe Annual General Meeting and copies may be made available on request.
STATUTORY AUDITORS AND REPORT
At the Annual General Meeting held on July 09 2021 M/s. S.R. Batliboi& Co. LLP Chartered Accountants (Firm Registration No.301003E/E300005) were appointedas Statutory Auditors of the Company to hold office till the conclusion of the 41st AnnualGeneral Meeting of the Company to be held in the calendar year 2026.
Audit Reports on Standalone Financial Statements and ConsolidatedFinancial Statements are self- explanatory and do not call for any further comments underSection 134 of the Companies Act 2013. The Auditors Report to the shareholders for theyear under review does not contain any adverse qualification. No frauds have been reportedby the Auditors under Section 143(12) of the Companies Act 2013 requiring disclosure inthe Board's Report.
SECRETARIAL AUDITORS AND REPORT
Ranjeet Pandey and Associates Company Secretaries (FCS-5922; C.P. No.6087) were appointed to conduct the secretarial audit of the Company for the financialyear 2021-22 as required under Section 204 of the Companies Act 2013 and Rules made thereunder. The Secretarial Audit Report for financial year 2021-22 forms part of this AnnualReport as Annexure-IV to this Directors' Report. There is no observation or Negativequalification in the report except the following: -
During the period under review the Company has complied with theprovisions of the Act Rules Regulations Guidelines Standards etc. mentioned abovesubject to the following observations:
1. One of the employees has sold 6000 (Six Thousand) equityshares of the Company at the aggregate value of Rs. 826843 (Rupees Eight Lakh Twenty-SixThousand Eight Hundred Forty-Three) in the market during the closure of trading window. Onbecoming aware proper intimations were given by the Company to Stock Exchange regardingthe non-compliance of SEBI (Prohibition of Insider Trading) Regulations 2015 Board ofdirectors of the Company was appraised and due penalties were imposed on the employee ofthe Company;
2. One of the relative of Designated Employee sold 500 equityshares of the Company during the closure of trading window. On becoming aware properintimations were given by the Company to Stock Exchange regarding the non-compliance ofSEBI (Prohibition of Insider Trading) Board of directors of the Company was appraised anddue penalties were imposed on the relative of designated employee.
Your directors are of the opinion that the aforesaid observations areself -explanatory and do not call for further explanation. An awareness campaign had beenlaunched across all Designated Persons to avoid such violation in future.
The Board of Directors has appointed Chandra Wadhwa & Co. CostAccountants as Cost Auditors (Firm Registration No. 00239) for conducting the audit ofcost records made and maintained by the Company for the financial year 2022-23 pursuant toSection 148 of the Companies Act 2013.
In accordance with the provisions of section 148 of the Act read withthe Companies (Audit and Auditors) Rules 2014 since the remuneration payable to the CostAuditor for financial year 2022-23 is required to be ratified by the members; the Boardrecommends the same for approval by members at the ensuing AGM.
Equity Shares of your Company are presently listed at National StockExchange of India Limited (NSE) and BSE Limited (BSE). The Annual Listing fees forfinancial year 2022-23 have been paid to the concerned Stock Exchanges.
During the year under review the Company has complied with theprovisions of the applicable Secretarial Standards issued by the Institute of CompaniesSecretaries of India. The Company has devised proper systems to ensure compliance with theprovisions of all applicable Secretarial Standards issued by the Institute of CompanySecretaries of India and such systems are adequate and operating effectively.
The Annual Return of the Company in accordance with Section 92(3) ofthe Companies Act 2013 is available on the website of the Company athttps://sparkminda.com/annual-returns/
SUBSIDIARIES JOINT VENTURE AND ASSOCIATES
Pursuant to Section 129 of the Companies Act 2013 a statement in theprescribed Form-AOC-1 relating to subsidiaries and Joint Ventures for the year ended onMarch 31 2022 has been attached with the Consolidated Financial Statements of the Companyfor the financial year ended March 31 2022.
The Financial Statements of the subsidiaries shall be made available tothe shareholders seeking such information and shall also be available for inspection atits Registered Office.
The Policy for determining material subsidiaries as approved may beaccessed on the Company's Website in investor section:https://sparkminda.com/wp-content/uploads/2020/04/Policy-on-Material-Non-Listed-Subsidiary.pdf
INTERNAL FINANCIAL CONTROL
The Board has adopted the policies and procedures for ensuring theorderly and efficient conduct of its business including adherence to the Company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial disclosures.
The Company has a Risk Management Committee pursuant to the provisionsof SEBI (Listing obligations and Disclosures Requirements) Regulations 2015 to assessrisk and to make mitigation procedures. The Risk Management Policy can be accessed on theCompany's website at the link: https://sparkminda.com/wp-content/uploads/2022/02/Annexure-XIIA-Risk_Management_Policy.pdf
This policy forms part of the internal control and corporate governanceprocess of the Company. Basically the aim of this policy is not to eliminate risksrather to mitigate the risks involved in the Company activities to maximize opportunitiesand minimize adversity by considering the following: -
Identification of risk define ownership with clearly definedroles and responsibilities;
Balance between the cost of managing risk and the anticipatedbenefits;
Contributing to more efficient use/allocation of capital andresources;
To encourage and promote a pro-active approach towards riskmanagement;
Identifying any unmitigated risks and formulating action plansfor its treatment through regular review.
While 2021-22 was a year of reinventing HR and solidifying its newrole 2022-23 is going to be all about pushing the boundaries of how HR can add value. Theyear 2022 had been topsy turvy one. HR was at the forefront of initiatives to respond to awide range of internal and external transformative trends from employee well-being to newworkforce models and social justice.
Spark Minda has always focused on improving employee wellbeing whilethey adapt to the new normal in 2021-2022. Staying connected with employees leadershipconnects and employee motivation are the key focus areas. As a team HR has insight andinfluence to all the different things that impact how an employee feels when they come towork throughout their time at an organization.
The HR initiatives continue to focus on hiring the talent with theright attitude develop and groom them and build the leadership pipeline. We havedigitalised our learning initiatives and launched "SPARK MINDA GURUKUL" (LMS) inHRIS. We are also striving to bring in more women employees at senior roles. We haveworked towards becoming a performance-driven organization. We have also digitalised ourRecruitment process to ease the functioning of hiring in the process.
Whether it is through driving better collaboration in the new era ofwork facilitating better career experience creating internal marketplaces to ease thepressure caused by talent shortages owning business transformation or deliveringinclusive and purpose-driven organizations to provide equitable benefits we are part ofthe solution.
The company has well-crafted and employee-friendly HR policies andhence it enjoys a cordial relationship with its employees. We have not experienced anymajor work stoppages due to labour disputes or cessation of work in the last many years.
It continues to emphasize and focus on safety and security at theworkplace by prescribing policies and procedures creating awareness and imparting piecesof training to the workforce. It also has an established mechanism that fosters a positivework environment that is free from harassment of any nature. Prevention of sexualharassment initiative framework is in place to address the complaints of harassment at theworkplace.
During the year under review your Company has received awards andrecognitions which have been mentioned in Award section of this Annual Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Our Company is committed to the highest standards of ethical moral andlegal business conduct. Accordingly Vigil Mechanism/ Whistle Blower Policy was formulatedwhich provides a platform to all the stakeholders of group to raise their genuine concerns& grievances to build and strengthen a culture of strong governance transparency andtrust within the organization by disclosing information internally without fear ofreprisal or victimization. Also safeguard the Spark Minda Group (SMG) against suchpractice which may lead to any adverse or negative impact on the group. The policy isconsistent with the relevant provisions of the Companies Act 2013 and the ListingAgreement with the Stock Exchanges in India. The policy also provides direct access to thewhistle blower ombudsman and Chairperson of the Audit Committee and no personnel has beendenied access to the audit committee during the year under review.
The policy encourages the employees and other parties to report whichhe/ she believes; shows serious "Concern / Disclosure" without any fear ofretaliation within the company.
Some of the examples of the issues are listed below which may form partof Concern/ Disclosure:
Any unlawful act whether criminal (e.g. theft) or a breach of the civil law(e.g. insult or defamation)
Breach of any policy or manual or code of conduct with an intent to gainpersonal advantage or causing loss to the company
Health and safety risks including risks to the public as well as otheremployees (e.g. faulty electrical equipment)
Fraud and corruption (e.g. to solicit or receive any gift/ reward as a bribe)
Gross wastage or misappropriation/ unofficial usage of company funds/assets
Manipulation of Company data/records questionable accounting/ financialreporting fraud
Leaking confidential or proprietary information
Any instance of failure to comply with legal or statutory obligation either forand on behalf of the Spark Minda Group or in any personal capacity in the course ofdischarging duties
Abuse of power (e.g. sullying/ harassment/ Threat)
Any other activity which is prohibited in company premises
Any undue favour or restrain based on caste religion and gender
Note: The above list is illustrative and should not be considered asexhaustive
The same has also been displayed on the website of the Company and thelink for the same is:https://sparkminda.com/wp-content/uploads/2022/04/Whistle_Blower_Policy_unsigned.pdf
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE POLICY
As per the requirement of "The Sexual Harassment of Women atWorkplace (Prevention Prohibition & Redressal) Act 2013 (Act')" andRules made there-under your Company has constituted Internal Complaint Committees (ICC).The Company has zero tolerance for sexual harassment at workplace. While maintaining thehighest governance norms the Company has also appointed external independent persons whohave requisite experience in handling such matters. During the year the Company has notreceived any complaint of sexual harassment.
Your Directors state that no disclosure or reporting is required inrespect of the following items as there were no transactions on these items during theyear under review:
1. Issue of equity shares with differential rights as to dividendvoting or otherwise.
2. Issue of shares (including sweat equity shares) to employees of theCompany under any scheme save and except ESOP referred to in this Report.
3. Neither the Executive Director nor the Whole-time Directors of theCompany receive any remuneration or commission from any of its subsidiaries except Ms.Pratima Ram who receives sitting fees from Minda Instruments Limited (Formerly known asMinda Stoneridge Instruments Limited).
4. No significant material orders have been passed by the regulators orcourt(s) or tribunal(s) which would impact the going concern status of the Company and itsfuture operations.
5. No such order is passed by any Regulators or Courts or Tribunalswhich would impact the going concern status of the Company and its future operations.
6. Details of application made or any proceeding pending under theInsolvency and Bankruptcy Code 2016 during the year along with status at the end of thefinancial year: NOT APPLICABLE
7. Details of difference between the amount of valuation done at thetime of one time settlement and valuation done while taking loan from the Banks orFinancial Institutions along with reasons thereof: NOT APPLICABLE
EVENT OCCURRED AFTER BALANCE SHEET DATE
No major events have occurred after the date of balance sheet of theCompany for the year ended on March 31 2022.
APPRECIATIONS AND ACKNOWLEDGMENTS
The Directors thank the Company's employees customers vendorsand investors for their continuous support. Our consistent growth was made possible bytheir hard work solidarity cooperation and support. The Directors are deeply gratefuland have immense respect for every person who risked their lives and safety to fight theCOVID-19 pandemic. The Directors appreciate and value the contribution made by everymember of the Spark Minda family.
| ||For and on behalf of the Board of |
| ||Minda Corporation Limited |
| ||Sd/- |
| ||Ashok Minda |
|Place: Gurugram ||Chairman & Group CEO |
|Date: May 17 2022 ||DIN: 00054727 |