Modison Metals Ltd.
|BSE: 506261||Sector: Engineering|
|NSE: N.A.||ISIN Code: INE737D01021|
|BSE 00:00 | 23 Oct||34.15||
|NSE 05:30 | 01 Jan||Modison Metals Ltd|
Modison Metals Ltd. (MODISONMETALS) - Director Report
Company director report
The Members of Modison Metals Ltd
The Directors have pleasure in presenting the Thirty Seventh AnnualReport of the Company along with the Audited Financial Statements of Modison MetalsLimited for the financial year ended 31st March 2020.
During the year under review the Company has achieved the turnover ofRs. 22217.38 Lakhs as compared to Rs.22098.81 Lakhs during previous year. The turnoveris marginally increased by 0.54% i.e. by Rs.118.57 Lakhs However Profit before tax &after exceptional income/expense decreased by 22.90% i.e. by Rs.559.90 Lakhs & NetProfit after tax decreased by 9.40% i.e. by Rs.156.85 Lakhs.
The Exports (FOB) including export in INR during the year amounts toRs.4544.82 Lakhs as against Rs 4435.25Lakhs achieved in the previous year. The export isincreased by 2.47% i.e. by Rs.109.57 Lakhs.
During the financial year ended 31st March 2020 the Company paid aninterim dividend of Re.1/- per equity share.
TRANSFER TO RESERVES
The Company has not transferred any amount to Reserves for theFinancial Year ended 31st March 2020.
The paid up equity capital as on 31st March 2020 stood at Rs.324.50Lakhs. During the year under review the Company has not issued equity share withdifferential voting rights sweat equity shares employee's stock options & notmade any provision for purchase of its own shares.
RESEARCH AND DEVELOPMENT
A state-of-the-art recognized R & D Division set up by the Companyin Financial Year 2002-2003 got renewed in May 2019 from Department of Science &Technology Industrial Research New Delhi. The R & D Division is working fordevelopment of new product as well as improvement in existing products. The companycontinue to invest in R&D towards new product development and capability building
There are no joint venture companies within the meaning section 2(6) ofthe Companies Act 2013.
The Company has not accepted any deposits from the public and as suchno amount of principal or interest on deposit was outstanding as on the balance sheetdate.
LOANS GUARANTEES AND INVESTMENTS
The particulars of loan guarantee and investment as per section 186 ofthe Act by the Company have been disclosed in the Financial Statement.
CHANGE IN NATURE OF BUSINESS
There being no change in the nature of business of the Company duringthe year.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
A detailed review of the operations performance future outlookResearch and development risk management and its business are given in the ManagementDiscussion and Analysis Report and forms part of this report.
PARTICULARS OF CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTIONFOREIGN EXCHANGE EARNINGS AND OUTGO
Information as per Section 134 (3) (m) of the Companies Act2013 readwith Rule 8(3) of Companies(Accounts) Rules2014 relating to conservation of energy &technology absorption foreign exchange earnings and outgo is provided in Annexure I formingpart of this Board Report.
EXTRACT OF ANNUAL RETURN
As per the requirements of Section 92(3) of the Act and Rules framedthereunder the extracts of the Annual Return is available on Company's website. Theweb link http://www.modison.com/annual-reports.html.
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to Corporate Social Responsibility andstrongly believes in given back to society.
The Corporate Social Responsibility Committee comprises of Mr. G.L.Modi Mr. Suresh Mody and Mr. R.A. Goenka as the members. Mr. G.L. Modi is the Chairman ofthe Committee.
The details of the various projects and programs which can beundertaken by the Company as a part of its CSR policy framework is available on thecompany's website. The web-link is http://www.modison.com/company-code-and-policies.html.
The disclosures required to be given under Section 135 of the CompaniesAct 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy)Rules 2014 are given in Annexure II forming part of this Board Report.
DIRECTORS & KEY MANAGERIAL PERSONNEL
Mr. Rakesh Singh and Mr. Kumar Jay Modi Directors of the Companyretire by rotation at the ensuing Annual General Meeting and being eligible offerthemselves for re- appointment.
Mr. Ashok Shantilal Jatia was appointed as an Independent Director ofthe Company for the term of five consecutive years with effect from 2nd November 2015 andhe will be completing his first term on 1st November 2020.
The Board of Directors of the Company at the meeting held on 20th July2020 on the recommendation of the Nomination and Remuneration Committee has approved theappointment of Mr. Ashok Shantilal Jatia as an Independent Director for the second term offive consecutive years with effect from 2nd November 2020 up to 1st November 2025subject to the approval of members at the forthcoming AGM since the board was of theopinion that his association would be of immense benefit to the company and it wasdesirable to avail the services of Mr. Ashok Shantilal Jatia as an Independent Director ofthe Company.
Mr. Manish Kumar Srivastava designation is elevated and appointed asJoint Managing Director of the Company subject to the approval of the members in theensuing Annual General Meeting for the period of 3 (Three) years w.e.f. 20th July 2020(earlier he was designated as CEO of the Company effective 20th May 2019 till 19th July2020)
During the year Ms. Deepashree Dadkar Company Secretary and ComplianceOfficer of the Company resigned from the services of the Company with effect from 15thOctober 2019. Consequent to Ms. Deepashree Dadkar resignation the Board has appointedMs. Manika Arora as the Company Secretary Key Managerial Personnel and Compliance Officerof the Company with effect from 16th December 2019. Further Mr. Ramesh Mangilal Kotharire-appointed as Chief Financial Officer of the Company w.e.f. 26th May 2020. .
During the year under review the non-executive directors of theCompany had no pecuniary relationship or transactions with the Company other than sittingfees for the purpose of attending meetings of the Board / Committee of the Company andprofessional fees for providing professional services.
Pursuant to the provisions of Section 203 of the Act the followingDirectors/officials of the Company have been designated as Key Managerial Personnel of theCompany by the Board of Directors :-
1. Girdhari Lal Modi Managing Director
2. RajKumar Modi Joint Managing Director
3. Kumar Jay Modi Whole time Director
4. Manish Kumar Srivastava Chief Executive Officer
5. Ramesh Mangilal Kothari Chief Financial Officer
6. Manika Arora Company Secretary.
The notice convening the Annual General Meeting includes the proposalfor reappointment of Directors.
DECLARATION FROM INDEPENDENT DIRECTORS
The Company has received declarations from all the IndependentDirectors of the Company confirming that they meet the criteria of independence laid downin Section 149(6) of the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.
The Board is of the opinion that the Independent Directors of theCompany possess requisite qualifications experience and expertise in the fields oftechnology digitalisation human resources strategy auditing tax and risk advisoryservices financial services corporate governance etc. and that they hold higheststandards of integrity. The Independent Directors of the Company have undertaken requisitesteps towards the inclusion of their names in the data bank of Independent Directorsmaintained with the Indian Institute of Corporate Affairs in terms of Section 150 of theAct read with Rule 6 of the Companies (Appointment &Qualification of Directors) Rules2014.
The credit rating awarded to your Company by CARE LTD on its long termbank facilities is "CARE A +" & short-term bank facilities is "CAREA1" respectively.
PERFORMANCE EVALUATION OF THE BOARD ITS COMMITTEES AND DIRECTORS
Pursuant to the provisions of the Act and Regulation 17(10) of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 the Board has carried out an annual performance evaluation of theperformance of the Board its Committees Chairman and Individual Directors. Theperformance evaluation of the Independent Director was carried out by the entire Boardexcept concerned Independent Directors. The Directors expressed their satisfaction withevaluation process.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS :
A familiarization program for independent directors as approved by theBoard and details for the same is available on the Company's website. The web-link ishttp://www.modison.com/other-announcements.html.
BOARD MEETINGS :
The Board of Directors duly met 8 times during the financial year from1st April 2019 to 31st March 2020. The dates on which the meetings were held are asfollows:
A separate report on Corporate Governance includes the detailedparticulars of Board & Committee Meetings is annexed and forms part of this Report ofthe Directors.
INDEPENDENT DIRECTORS MEETING
The meeting of the Independent Directors in FY 2019-20 was held on 4thFebruary 2020.
COMPANY'S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:
The policy on Directors' appointment and remuneration includingthe criteria for determining the qualifications positive attributes independence of aDirector and other matters provided under Section 178(3) of the Companies Act 2013 formspart of the Nomination & Remuneration Policy of the Company and The policy isavailable on the Company's website and the web-link ishttp://www.modison.com/company-code- and- policies.html.
RELATED PARTY TRANSACTIONS
All related party transactions entered into by the Company during thefinancial year are placed before the Audit Committee for its approval. Prior omnibusapproval of the Audit Committee is obtained for transactions which are repetitive innature. A statement giving details of all related party transactions is placed before theAudit Committee and the Board of Directors for their approval on a quarterly basis. Thepolicy on Related Party Transactions as approved by the Board is available on theCompany's website and the web-link is
Further the disclosures as required under Section 134(3)(h) of theCompanies Act 2013 in Form AOC-2 form part of this Report as Annexure III.
PARTICULARS OF EMPLOYEES
The particulars of employees required to be furnished pursuant toSection 197(12) of the Companies Act 2013 read with sub-rules 2 and 3 of Rule 5 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as amendedforms part of this Report as Annexure IV. However as per the provisions of Section136 of the Companies Act 2013 read with sub-rules 2 and 3 of Rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Annual Reportexcluding the statement of particulars of employees is being sent to all the shareholdersof the Company. Any shareholder interested in obtaining a copy of the said statement maywrite to the Company Secretary at the Registered Office of the Company.
i) Statutory Auditors
Pursuant to provisions of Section 139 of the Companies Act 2013 readwith the Companies (Audit and Auditors) Rules 2014 M/s. Kanu Doshi Associates LLPChartered Accountants having firm registration No. 104746W /W100096 were appointed asstatutory auditors of the Company for a term of three years to hold office from theconclusion of 34th Annual General Meeting upto conclusion of 37th Annual General Meeting.Your Board is of the opinion that continuation of M/s. Kanu Doshi Associates LLPChartered Accountants as Statutory Auditors for second consecutive term of two years willbe in the interest of the Company and therefore Members are requested to consider theirre-appointment as the Statutory Auditor of the Company from the conclusion of this AGMtill the conclusion of the 39th Annual General Meeting.
The Auditor's report on Financial Statements of the Company forthe year ended 31st March 2020 issued by M/s Kanu Doshi Associates LLP CharteredAccountants having firm registration No. 104746W/W10009 does not contain anyqualification.
ii) Cost Auditors
Pursuant to Section 148 of the Companies Act2013 (the Act')read with Rule 8 of the Companies (Accounts) Rules2014 it is stated that the costaccounts and records are made and maintained by the Company as specified by the CentralGovernment under Section 148(1) of the Companies Act2013.
The Board of Directors in pursuance of Section 148 of the CompaniesAct 2013 have appointed M/s. N. Ritesh & Associates. Cost Accountants Mumbai forconducting the audit of the cost accounting records maintained by the Company for thefinancial year 2020-2021. They have confirmed that their appointment is within the limitsof Section 141(3)(g) of the Companies Act 2013 and that they are not disqualified fromacting as Cost Auditors.
iii) Secretarial Auditor
M/s. Ragini Chokshi & Co Practicing Company Secretaries Mumbaiwere appointed to conduct Secretarial Audit for the year ended 31st March 2020 inaccordance with provisions of Section 204 of the Companies Act 2013. The SecretarialAuditor's Report is enclosed and forms a part of this Directors Report. The Report isselfexplanatory.
COMPOSITION OF THE AUDIT COMMITTEE
As required by Section 177(8) read with Section 134(3) of the CompaniesAct 2013 and the Rules framed thereunder the composition of the Audit Committee is inline with the provisions of the Companies Act 2013 and SEBI Listing Regulations detailsof which are provided in the Corporate Governance Report forming part of this AnnualReport.
MATERIAL CHANGES & COMMITMENTS
The COVID-19 pandemic has severely disrupted business operations due tolockdown and other emergency measures imposed by the Central & State Governments. Theoperations of the Company were impacted due to shutdown of plants and offices followingthe nationwide lockdown. The Company continues with its operations in a phased manner inline with directives from Central & State Governments & local authorities.
The Company has evaluated the impact of this pandemic on its businessoperations liquidity and financial position and based on management's review of currentindicators and economic conditions there is no material impact on its financial resultsas at 31st March 2020. However the impact assessment of COVID-19 is a continuing processgiven the uncertainties associated with its nature and duration and accordingly the impactmay be different from that estimated as at the date of approval of this Report. TheCompany will continue to monitor any material changes to future economic conditions.
On June 17 2019 Modison Contacts Private Limited become the whollyowned subsidiary Company of your Company for a total consideration of Rs 24.92 Lakhs.
During the year Board of Directors reviewed the affairs of thesubsidiary. In accordance with section 129(3) of the Companies Act 2013 we have preparedconsolidated financial statements of the company which form part of the Annual Report.Further a statement containing the salient features of the financial statement of oursubsidiary in the prescribed format of AOC-1 appended as Annexure V in BoardReport.
In accordance with Section 136 of the Companies Act 2013 the auditedfinancial statements including consolidated financial statements and related informationof the Company and audited account of its subsidiary are available on our website
The material subsidiaries policy is available on Company's websiteand the web link is http://www.modison.com/ company-code-and-policies.html.
Your Company has taken adequate steps to adhere to all the stipulationslaid down in Regulation 34 (3) read with Schedule V of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015. A report onCorporate Governance is included as a part of this Annual Report. The Auditor'sCertificate on its compliance form part of this Report and is annexed hereto.
COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND ANNUAL GENERALMEETINGS:
The Company has complied with Secretarial Standards issued by theInstitute of Company Secretaries of India on Board Meetings and Annual General Meetings.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to Section 134 (3) (c) read with Section 134 (5) of the Acton the basis of information placed before them the Directors state that:
i) in the preparation of the annual accounts the applicable IndAsaccounting standards has been followed along with proper explanation relating to materialdepartures if any;
ii) appropriate accounting policies have been selected and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company as at 31st March 2020and of the profit and loss of the Company for the said period;
iii) proper and sufficient care has been taken for the maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities
iv) the annual accounts have been prepared on a going concernbasis;
v) the internal financial controls to be followed by the companyand that such internal financial controls are adequate and were operating effectively; and
vi) there is a proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
The Company is exposed to the risk of price fluctuation of silver (rawmaterial). The Company proactively manages this risk through hedging inventorymanagement. The Company's reputation for quality with robust marketing existencemitigates the impact of price risk on finished goods.
Also the Company is exposed to Strategic Risk Allocation of funds forCAPEX Operational Risks Regulatory and environmental non-compliances. The Company copesthese risks by developing alternate plans framing various policies initiativesguidelines using automated systems.
The Company has a robust Risk Management framework to identifyevaluate business risks and opportunities. This framework seeks to create transparencyminimize adverse impact on the business objectives and enhance the Company'scompetitive advantage. The business risk framework defines the risk management approachacross the enterprise at various levels including documentation and reporting. TheCompany's approach to addressing business risks is comprehensive and includesperiodic review of such risks and a framework for mitigating controls and reportingmechanism of such risks.
ADEQUACY OF INTERNAL FINANCIAL CONTROL
The Company has adequate system of internal financial control tosafeguard and protect from loss unauthorized use or disposition of its assets. All thetransactions are properly authorized recorded and reported to the Management. The Companyis following all the applicable Accounting Standards for properly maintaining the books ofaccounts and reporting financial statements. Additional details on Internal FinancialControls and their adequacy are provided in the Management Discussion and Analysis Reportforming part of this Annual Report.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013 and Regulation 22 of Listing Regulations the Company has Whistleblower Policy for Directors and employees to deal with instance of fraud andmismanagement if any. The Whistle blower Policy has been uploaded on the website of theCompany and the web-link is http://www.modison .com/company-code-and-policies.html.
PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE
As per the requirements of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules made thereunder yourCompany has adopted a Policy for Prevention of Sexual Harassment at Workplace and hasconstituted an Internal Committee (IC). The names of the Committee Members are displayedon the notice board in each office. All employees as well as contract staff and traineesare covered by this policy. Allegations of sexual harassment reported are expeditiouslyand discreetly investigated and disciplinary action if required is taken in accordancewith the policy.
There was no complaint of sexual harassment received during thefinancial year 2019-2020.
The Company's equity shares are listed at BSE Limited and theAnnual Listing Fees for the year 2019 -20 and 2020-21 has been paid.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulatorsor Courts that would impact the going concern status of the Company and its futureoperations.
Your Directors place on record their appreciation for the assistanceand support extended by all Customers Vendors Government Authorities FinancialInstitutions Banks Consultants Solicitors Regulatory Authorities and Shareholders ofthe Company.
The Directors regret the loss of life due to COVID-19 pandemic and aredeeply grateful and have immense respect for every person who risked their life and safetyto fight this pandemic.
The Directors express their appreciation for the dedicated and sincereservices rendered by the employees of the Company at all levels.
ANNEXURE I TO DIRECTORS' REPORT
Particulars Required Under Section 134 Of The Companies Act 2013 ReadWith Rule 8 of Companies (Accounts) Rules2014
A. CONSERVATION OF ENERGY
a) Steps taken or impact on conservation of energy:
In line with the Company's commitment towards conservation ofenergy all units continue with their efforts aimed at improving energy efficiency throughinnovative measures to reduce wastage and optimize consumption. Some of the measures takenby the Company in this direction is by installing :
Identified area of high energy consumption like electricfurnaces optimized energy usage and consumption.
Maintained power factor near unity hence reduced energy losses
Use of energy efficient tube lights motors air conditioner etc
Use of energy efficient air compressors
b) Steps taken by the Company for utilizing alternate sources ofenergy:
During the year under review the Company utilized solar energy forselfconsumption and received rebate in electricity bill.
c) Capital investment on energy conservation Equipment's : Rupees15.35 Lakhs
B. TECHNOLOGY ABSORPTION
a) Efforts made towards technology absorption The efforts made by theCompany in
Develop Silver based salts for pharma and food industriesdevelopment of High purity silver oxide.
b) Benefits derived like product improvement cost reduction productdevelopment or import substitution Product Development -Developed silver tin oxide basedelectrical contacts a future replacement for silver cad oxide contacts.
c) Information regarding technology imported during the last threeyears : Nil
d) Research & Development:
Specific areas in which R&D carried out by the company:
Copper Beryllium alloys.
develop Silver based salts for pharma and food industries.
Development of High purity silver oxide.
Benefits derived as a result of above R & D :
Foray into identified segment of MV business
More cost competitive products made available
C. FOREIGN EXCHANGE EARNINGS AND OUTGO :
a) Activities Relating To Exports:
The Company is contributing towards imports substitution inElectrical & Switchgear Industries and making the country self-reliant in this regard.
b) Total Foreign Exchange Used and Earned (2019-2020)