Mold-Tek Technologies Ltd.
|BSE: 526263||Sector: Engineering|
|NSE: MOLDTECH||ISIN Code: INE835B01035|
|BSE 00:00 | 15 Feb||42.00||
|NSE 00:00 | 15 Feb||42.60||
|Mkt Cap.(Rs cr)||117|
|Mkt Cap.(Rs cr)||116.97|
Mold-Tek Technologies Ltd. (MOLDTECH) - Director Report
Company director report
Your Director's have pleasure in presenting the 34th Annual Report andthe Audited Statement of Accounts for the year ended 31st March 2018.
The Company`s operating performance during the year ended 31st March2018 is summarized below.
On a Standalone basis the Company achieved a standalone Revenue of`6298.27 Lakhs as against
`5589.85 Lakhs achieved during 12 months of previous year reflecting agrowth of 12.67%.
On a Consolidated basis the Company achieved a consolidated Revenue of`7160.41 Lakhs as against
`6308.22 Lakhs achieved during 12 months of previous year reflecting agrowth of 13.51%.
Slow down in US construction activity in winter effected the structuraldivision sales. However work flow improved considerably from March 2018 and some of theTier-1 fabricators started using our services.
Civil Engineering Services (CES) Division grew from
$ 7.93 million to $ 8.73 million by 10.01% and the MechanicalEngineering Services (MES) Division grew from $ 1.35 million to $ 1.39 million by 3.21%.The IT division has performed well and grew rapidly from $ 0.27 million to $ 0.57 millionby 113.21 %. However it is still generating below BEP.
Structural Steel Division:
The current order book position is far better than the same compared toprevious year. Company expects handsome growth in revenues in the coming quarters. TheCivil division is receiving orders for high rise buildings received which will be executedin the FY 2018-19. Company's performance during last few years has been well recognized byUS fabricators who are giving us preferred vendor status which mayreflect
Mechanical Engineering Services:
In Mechanical Engineering Services Company gained confidence ofEuropean Tier - 1 Auto companies and able to get end to end projects instead of smallportions.Company has appointed a very senior BDM at Detroit USA to enhance MES domains andadd clients from USA. He has more than 25 years of experience in US Automotive and MES andworked with a reputed MES- KPO as General Manager BD Operations before joining Mold-Tek.US clients addition expected to improve MES Revenues from Q3 2018-19 onwards.
IT Division has developed and started marketing a Patient engagementapp for health care industry. Product revenues and project based revenues are expected togrow further in coming Quarters. It is also working with few MNC's on combined staffingand project execution model.
CHANGE IN THE NATURE OF BUSINESS IF ANY
No change in the nature of Business.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIALPOSITION OF THE COMPANY
No material changes and commitments affecting the financial position ofthe Company have occurred between the end of the financial year to which the financialstatements relate and the date of this Directors' Report.
As on 31 March 2018 the company has "Mold-Tek TechnologiesInc" as its Subsidiary. The financial position of the said company is given in thenotes to consolidated Financial statements. The Highlights of the performance ofsubsidiary is as follows:
The audited accounts of the subsidiary company is placed on theCompany's website and it is available for inspection at the registered office of the
Company during working hours. The Company will make available a copythereof to any member of the Company who may be interested in obtaining the same.
Pursuant to the provisions of Section 129 (3) of the Companies Act2013 a statement containing salient features of in Form AOC 1 is attached to theAccounts.
CONSOLIDATED FINANCIAL STATEMENTS(CFS)
The Consolidated Financial Statements of your
Company for the financial year 2017-18 are prepared in compliance withapplicable provisions of the Companies Act 2013 read with the Rules issued thereunderapplicable Accounting Standards and the provisions of SEBI (LODR) Regulations 2015(hereinafter referred to as the "Listing Regulations").
The consolidated financial statements have been prepared on the basisof audited financial statements of your Company its subsidiary as approved by therespective Board of Directors. The Consolidated Financial Statements should therefore beread in conjunction with the Directors' report financial notes cash flow individualauditor reports of the subsidiary.
Pursuant to provisions of section 129(3) of the Companies Act 2013 astatement containing salient features of the financial statements of the Company'ssubsidiary is attached to the financial statements of the Company.
Your Directors have recommended a final dividend `0.40/- per equityshare @20% of paid up equity share of face value of `2/- each in addition to interimdividend of `0.30/- (15%) hitherto declared making a total of `0.70/- (35%) per equityshare (previous year `0.60/- per equity share @30% of paid up equity share of `2/- each)for the year ended 31st March 2018.The approved will be paid to those members whose namesappear in Register of Members as on 22nd September 2018. In respect of shares held indematerialized form it will be paid to members whose names are furnished by NationalSecurities Depository Limited and Central Depository Services (India) Limited asbeneficial owners as on that date. This will entail an outflowof `132.34 Lakhs(Inclusiveof dividend tax).
The dividend payout for the years under review has been formulatedkeeping in view your Company`s need for capital for its growth plans and the intent tofinance such plans through internal accruals to the optimum.
Equity shares that may be allotted on or before the
Book Closure will rank pari passu with the existing shares and will beentitled to receive the dividend. statementsofsubsidiary
TRANSFER TO RESERVE
The Directors propose to transfer a sum of Rs 96.74
Lakhs to General Reserve out of the profits earned by the Company
FIRST - TIME ADOPTION OF IND AS
The financials for the year ended March 31 2018 are the financialstatements prepared by the Company in accordance with IND AS. For the periods up to andinclusive of year ended March 31 2017 the Company prepared its financial statement inaccordance with accounting standards specified the Companies Act 2013 read together withrule 7 of Companies (Accounting Standards) Rules 2014 (Previous GAAP). Reconciliation anddescription of the effect of transition from previous GAAP to IND AS statements and the onequity profit
42. The Balance Sheet as on the date of transition has been prepared inaccordance with IND AS 101 first adoption of Indian Accounting standards and accordinglyfigures of previous years have regrouped to confirmtothe current year's presentation.
SHARE CAPITAL AND CONSEQUENT CHANGES AUTHORISED SHARE CAPITAL
The Authorised Share Capital of the Company as on 31st March 2018stands at Rs 130000000/- (Rupees Thirteen Crores only) divided into 65000000 (Six
Crores Fifty Lakhs) Equity Shares of Rs 2/- (Rupees
Two Only) each. During the year there has been financial no change inthe Authorised Share Capital of the final dividend Company.
PAID UP SHARE CAPITAL
The paid up equity share capital of the company was `54888624/-divided into 27444312 equity shares of face value of `2/- each as on 31st March 2018.The Board of Directors via a circular resolution dated 12th May2017 allotted 20000equity shares of face value of `2/- each at a price of `14.60/- [comprising face value of`2/- and premium of
`12.60/- each] to its employee who have exercised the option vested onthem under the MTTL ESOS 2015.
The Board of Directors in the meeting held on 28th August 2017allotted 111490 equity shares of face value of ` 2/- each at a price of `12.20/-[comprising nominal value of `2/- and premium of
November 2017 allotted 220690 equity shares of face value of Rs 2/-each at a price of ` 14.60/- [comprising nominal value of `2/- and premium of
`12.60/- each] to its employees who have exercised the option vested onthem under the Mold-Tek Technologies Employees Stock Option Scheme 2015. The Board ofDirectors via a circular resolution dated 01st December 2017 allotted 22825 equityshares of face value of `2/- each at a price of `14.60/- [comprising face value of `2/-and premium of
`12.60/- each] to its employee who have exercised the option vested onthem under the MTTL ESOS 2015.
Post allotment the paid up share capital of the company has beenincreased to `54888624/- divided into 27444312 equity share of face value of `2/-each as on 31st March 2018. The Board of Directors in the meeting held on 29th May 2018(After the Balance Sheet Date) allotted
118295 equity shares of face value of `2/- each at a price of`12.20/- [comprising nominal value of `2/- and premium of `10.20/- each] to its employeeswho have exercised the option vested on them under the Mold-Tek Technologies EmployeesStock Option Scheme 2009.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Loans guarantees and investments covered under Section 186 of theCompanies Act 2013 form part provided in ofthenotestothe this Annual Report.
The Company has neither accepted nor renewed any deposits from publicwithin the meaning of Section 73 of the Companies Act 2013 read with Companies(Acceptance of Deposits) Rules 2014 during the year under review.
INTERNAL CONTROLS SYSTEMS AND ADEQUACY
The Company's internal audit systems are geared towards ensuringadequate internal controls commensurate with the size and needs of the business with theobjective of efficient conduct of operations through adherence to the Company's policiesidentifying areas of improvement evaluating the reliability of Financial Statementsensuring compliances with applicable laws and regulations and safeguarding of assets fromunauthorized use.
Details of the internal controls system are given in the ManagementDiscussion and Analysis Report which forms part of the Directors' Report.
DETAILS OF DIRECTORS/KEY MANAGERIAL PERSONNEL
All the Independent Directors have given declarations that they meetthe criteria of independence as laid down under Section 149 (6) of the Companies Act 2013and Regulation 16 of SEBI (LODR Regulations)
2015. In the opinion of the Board they fulfill the conditions ofindependence as specified in the
Companies Act 2013 and the Rules made there under and are independentof the management.
Based on the confirmations received none of the Directors aredisqualified for being appointed/reappointed as directors in terms of Section 164 of theCompanies Act 2013.
In accordance with the provisions of Section 152 of the Companies Act2013 P Venkateswara Rao Director of the Company is liable to retire by rotation and iseligible for re-appointment. Ms. Pooja Jain has resigned from the position of
Company Secretary and Compliance Officer of the company with effectfrom 16th November 2017 and the same has been approved and taken on record by the board ofdirectors at its meeting held on 16th November 2017.
Mr. Bharat Reddy was appointed as Company
Secretary and Compliance Officer of the company with effect from 17thNovember 2017 at the Board Meeting held on 16th November 2017.
In the Board Meeting held on 09 February 2018 Mr. Shyam Sunder Rao hasresigned from the post of Independent Director of the company w.e.f 09 February 2018. TheBoard has placed its sincere appreciation for the services rendered by him during histenure.
In the Board Meeting held on 14th May 2018 Mr. Ramakrishna Bonagiriand Mr. Dhanraj Tirumala Narasimha Rao Togaru were appointed as an Additional Director(Independent) of the company. Further they are proposed to be appointed as Director(Independent) of the company under Section 161 of the Companies Act 2013 at the ensuring34th Annual General Meeting.
In the Board Meeting held on 14th May 2018 Mr. Bhujanga RaoJanumahanti was appointed as an Additional Director of the company. Further he isproposed to be appointed as Director of the company under Section 161 of the CompaniesAct 2013 at the ensuring 34th Annual General Meeting. In the Board Meeting held on 14thMay 2018 Mr. Srinivas Madireddy has resigned from the post of Independent Director of thecompany w.e.f 14th May 2018. The Board has placed its sincere appreciation for theservices rendered by him during his tenure.
Apart from above there has been no change in Directors and KeyManagerial Personnel.
EMPLOYEE STOCK OPTION SCHEME
The Company has in operation Mold-Tek Technologies Employees StockOption Scheme 2009 MTTL ESOS -2015 and MTTL ESOS 2016 for granting stock options to theemployees of its company in accordance with the Securities Exchange Board of India(Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 andSecurities Exchange
Board ancial controls were adequate of India (Share Based employeebenefits)
There have been no Changes in the Scheme.
Disclosures pursuant to Regulation 14 of the Securities and ExchangeBoard of India (Share Based
Employee Benefits) Regulations 2014 are enclosed as Annexure - Ato this report.
The Annexure A is also available on website of the company atwww.moldtekgroup.com.
The Company has adopted Governance Guidelines or code of conduct onBoard Independent Director Key Managerial Personnel or Senior Managerial Personnel. TheGovernance Guidelines or code of conduct cover aspects related to role of the Boarddiversity definition of independence and duties of independent Directors Code ofConduct Moral ethics and principles to be followed.
NOMINATION REMUNERATION AND PERFORMANCE EVALUATION POLICY
The requisite details as required by Section 134(3)
Section 178(3) & (4) of Companies Act 2013 and Regulation 34 ofSEBI (LODR) Regulations 2015 is provided in the Corporate Governance Report.
TRANSACTION WITH RELATED PARTIES
The requisite details as required by Section 134 &
188 of Companies Act 2013 and Regulation 23 34(3) of SEBI (LODR)Regulations 2015 is provided in the Corporate Governance Report. The details as per formAOC-2 are enclosed as Annexure B.
BOARD AND COMMITTEE MEETINGS
Details of the composition of the Board and its Committees and of theMeetings held and attendance of the Directors at such Meetings are provided in theCorporate Governance Report. The intervening gap between the Meetings was within theperiod prescribed under the Section 173(1) of Companies Act 2013 and Regulation 17(2)SEBI (LODR) Regulations 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
Based on the framework of internal financial controls and compliancesystems established and maintained by the Company work performed by the InternalStatutory Cost and Secretarial Auditors and the reviews performed by Management and therelevant Board Committees including the Audit Committee the Board is of the opinion thatthe
Company'sinternal and effective during the financial year 2017-18.
Accordingly pursuant to Section 134 (3) (c) and 134 (5) of theCompanies Act 2013 the Board of Directors to the best of their knowledge and abilityconfirm that:
(i) in the preparation of the annual accounts the applicableaccounting standards have been followed and that there are no material departures; (ii)they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period; (iii) they have taken proper and sufficient carefor the maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities; (iv) they have prepared the annual accounts on a going concernbasis; (v) they have laid down internal financial controls to be followed by the Companyand that such internal are adequate and are operating effectively;
(vi) they have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
Pursuant to Section 135 of the Companies Act 2013 read with theCompanies (Corporate Social Responsibility Policy) Rules 2014 the Company hasconstituted CSR Committee constituting 1 Executive Director 2 Non Executive PromoterDirectors and 1 independent Director chaired by Mr. J. Lakshmana Rao. The composition ofthe Corporate Social
Responsibility Committee meets the requirements of
Section 135 of the Companies Act 2013. The Board of Directors basedon the recommendations of the
Committee formulated a CSR Policy. The requisite details on CSRactivities pursuant to Section 135 of the Companies Act 2013 and as per Annexure attachedto the Companies (Corporate Social Responsibility Policy) Rules 2014 are annexed as AnnexureC to this Report.
POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT ATWORKPLACE
The Company has zero tolerance for sexual harassment at workplace andhas adopted a Policy on Prevention Prohibition and Redressal of Sexual Harassment at theWorkplace in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 and the Rules there under. The policyaims to provide protection to employees at the workplace and prevent and redresscomplaints of sexual harassment and for matters connected or incidental thereto with theobjective of providing a safe working environment where employees feel secure. TheCompany has also constituted an Internal Complaints Committee known as the
Prevention of Sexual Harassment (POSH) Committee to inquire intocomplaints of sexual harassment and recommend appropriate action. In the Financial year2017-18 the Company has not received any complaints which fall within the scope of thispolicy. The policy is available on website of the company athttp://moldtekengineering.com/pdf/MTTL%20 Policy%20of%20SH.pdf
VIGIL MECHANISM/ WHISTLE BLOWER POLICY financial The requisitedetails as required by Section 177 of
Companies Act 2013 and Regulation 22 &34 (3) of SEBI (LODR)Regulations 2015 is provided in the Corporate Governance Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant material orders have been passed by the Regulators orCourts or Tribunals which would impact the going concern status of the Company and itsfuture operations.
(1) Statutory Auditors:
M/s. M. Anandam & Co Chartered Accountants (Firm Registration No002739S) are the statutory auditors of the Company and hold office till the conclusion ofthe 38th Annual General Meeting (AGM).
Notes to Accounts and Auditors Report
The notes to the accounts referred to in Auditors' Report areself-explanatory and do not call for any further comments. The Audit Report does notcontain any qualification reservation or adverse remark.
(2) Secretarial Auditors:
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theBoard of Directors of the Company had appointed Mr. Ashish Kumar Gaggar a CompanySecretary in Practice to undertake the Secretarial Audit of the Company for the year ended31st March 2018. The Secretarial Audit Report is annexed as Annexure D.
The Secretarial Audit Report for the financial year ended 31st March2018 do not contain any qualification reservation adverse remark or disclaimer.
CONSERVATION OF ENERGY toTECHNOLOGY the Board ABSORPTIONAND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption andforeign exchange earnings and outgo stipulated under Section 134 (3) (m) of the CompaniesAct 2013 read with Rule 8 of The Companies (Accounts) Rules 2014 is annexed as AnnexureE.
PARTICULARS OF REMUNERATION
The information required under Section 197 (12) of the Companies Act2013 read with Rule 5(1) of The Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed as
The information required under Rule 5 (2) and (3) of
The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is provided in the Annexure forming part of the Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92 (3) of the Companies Act 2013 and Rule 12 (1)of the Companies (Management and Administration) Rules 2014 the extract of Annual Returnin form MGT.9 is annexed as Annexure G.
MANAGEMENT DISCUSSION AND ANALYSIS AND CORPORATE GOVERNANCE
The Management Discussion and Analysis Report and the Report onCorporate Governance as required under Regulation 34 (2) of SEBI (LODR) Regulations2015 forms part of the Annual Report.
Your Company is committed to the tenets of good
Corporate Governance and has taken adequate steps to ensure that therequirements of Corporate
Governance as laid down under SEBI (LODR) Regulations 2015 arecomplied with.
A separate report on Corporate Governance and a Management Discussionand Analysis Report is being presented as part of the Annual Report. A declaration of Codeof Conduct from Mr.J. Lakshmana Rao Chairman and Managing Director forms part of theCorporate Governance Report.
Mr. J. Lakshmana Rao Chairman and Managing Director and Mr. SatyaKishore Nadikatla Chief
Financial Officer of the Company have given asa contemplatedcertificatein
Regulation 17(8) of SEBI (LODR) Regulations 2015.
All assets of the Company and other potential risks have beenadequately insured.
The relationship with the workmen and staff remained cordial andharmonious during the year and the management received full co-operation from theemployees.
In the terms of provision of Section 134(3) (ca) of the Companies Act2013 during the year under review there was no case of offense of fraud detected by theAuditors under sub section (12) of section 143.
MAINTENANCE OF COST RECORDS
The Central Government has not prescribed the maintenance of costrecords under sub section (1) of section 148 of the Companies Act 2013 for theproducts/services of the company.
Your Directors wish to place on record their appreciation and gratitudefor all the assistance and support received from Citibank and ICICI Bank
Limited and officials of concerned government departments for theirco-operation and continued support extended to the Company. They also thank the Membersfor the confidence they have reposed in the Company and its management.
For and on behalf of the Board of Directors
Chairman & Managing Director (DIN:00649702)
Place : Hyderabad
Dated : 1st September 2018