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Nitiraj Engineers Ltd.

BSE: 538407 Sector: Engineering
NSE: NITIRAJ ISIN Code: INE439T01012
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Nitiraj Engineers Ltd. (NITIRAJ) - Director Report

Company director report

To

The Members

NITIRAJ ENGINEERS LIMITED

306 Babha Building N M. Joshi Marg Near Police Station Mumbai 400011 INDIA

Your Directors have a pleasure in presenting the 22nd Annual Report onthe business and operation of the Company together with the Audited Financial Accounts forthe year ended 31st March 2021.

1. FINANCIAL HIGHLIGHTS

Financial results of your Company for the year ended 31st March 2021 aresummarized below. (Standalone)

Financial Statement
Particulars 2020-21 2019-20
Income from Operations 5382.15 4786.37
Other Income 20.64 187.64
Total revenue 5402.78 4974.01
Operating Costs 4622.42 4470.91
Profit before depreciation 780.36 503.10
Depreciation 288.41 142.14
Profit before exceptional item and Tax 491.95 360.96
Exceptional Item 0.00 0.00
Profit before Tax (PBT) 491.95 360.96
Tax expense 128.43 102.36
Profit for the year (PAT) 363.52 258.60
Basic EPS 3.55 2.52

2. HIGHLIGHTS OF PERFORMANCE:-

Total Revenue for the year 2020-21 has increased to Rs. 5382.15 lacs as compared toRs. 4786.37 lac's in the previous year. Profit before Tax for the year was Rs. 491.95lac's as compared to profit of Rs. 360.97 lac's in the previous year. Profit after Tax forthe year was Rs. 363.52 Lac's as compared to profit of Rs. 258.60 lac's in the previousyear.

3. CHANGE IN THE NATURE OF BUSINESS IF ANY

There is no change in the nature of business carried out by the Company in the Year2020-21.

4. SHARE CAPITAL

Company issued bonus shares thus there is an addition in Share Capital of the companyduring financial year 2020-21.

5. DIVIDEND

In order to plough back the profits for the activities of the company and strategy ofgrowth in the business through enhancing manufacturing capacity your directors do notrecommend any dividend for the financial year.

6. CHANGE IN NAME

The company has not changed its name during financial year 2020-21.

7. RESERVES

The Board of the Company has decided to carry Rs. 363.52 Lac's to the Reserves of theCompany as on 31st March 2021.

8. THE BOARD AND KMP :

(a) Composition of the Board of Directors :

The Board of Directors of the Company has an optimum combination of ExecutiveNon-Executive and Independent Directors. As on the date of this report the Boardcomprises of 6(Six) Directors out of which 3 are Executive Directors 3 is IndependentNon-Executive Director and is that includes one Woman Director. The Chairman of the Boardis an executive director.

The Company has following composition of the Board:-

1 Mr. Rajesh Bhatwal Managing Director and Executive Director
2 Mrs. Shakuntala Bhatwal Whole Time and Women Director
3 Mr. Hung Sin Chung Huanyi Whole Time Director
4 Mr. Anil Nandkishor Bangad Independent Director Non-Executive Director
5 Mr. Pradeep Chandrakant Shah Independent Director Non-Executive Director
6 Mr. Shabbir Sadruddin Masani Independent Director Non-Executive Director

Director Retiring by Rotation

Pursuant to Section 152 of the Companies Act 2013 and in accordance with the Articleof Association of the Company Mr. YI Hung Sin (DIN No- 01953871) Whole Time Director ofthe Company retires by rotation at the ensuing Annual General Meeting and being eligibleoffers herself for re-appointment. The Board of Directors recommends her re-appointment.

Company Secretary & Compliance Officer.

There was no change in the post of company secretory and compliance officer.

9. MEETINGS OF BOARD OF DIRECTOR AND SHAREHOLDERS

Twelve board meetings were held during the year 2020-21 and four audit committeemeetings and two nomination and remuneration committee meetings and two stakeholders'relationship committee meetings and the intervening gap between meetings was within theperiod prescribed under Secretarial Standards applicable to the company.

10.BOARD EVALUATION

Pursuant to the provision of the companies Act 2013 Listing regulation along withother rules and regulation applicable if any the company has carried out the annualperformance evaluation of its own performance the director individually as well as theevaluation of the working of its committees A structured questionnaire was prepared aftertaking into consideration inputs received from the Directors covering various aspect ofthe board functioning such as adequacy of the composition of the board and its committeesboard culture execution and performance of specific duties obligation and governance.

A separate exercise was carried out to evaluate the performance of the individualdirector including the Chairman of the Board who were evaluated on parameter such aslevel of engagement and contribution independence of judgment Safeguarding interest ofthe company and its minority shareholders etc. The performance evolution of IndependentDirector was carried out by entire board. The performance evolution of the chairman andnon-Independent Director was carried out by the Independent Director who also reviewed theperformance of the secretarial Department. The Director expresses their satisfaction withthe evaluation process.

11.COMPANY POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION

The policy of the company on Director's appointment and remuneration including criteriafor determining qualification positive attributes independence of Director and othermatters provided under Sub section (3) 178 is explained in the corporate governancereport.

12. DETAILS OF REMUNERATION TO DIRECTORS : -

The remuneration paid to the Directors is in accordance with the recommendations ofNomination and Remuneration Committee formulated in accordance with Section 178 of theCompanies Act 2013 and any other re-enactment(s) for the time being in force.

The information relating to remuneration of Directors and details of the ratio of theremuneration of each Director to the median employee's remuneration and other details asrequired pursuant to section 197(12) of the Act read along with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is given in Annexure.

13. DECLARATION BY INDEPENDENT DIRECTORS:-

Every Independent Director at the first meeting of the Board in which he participatesas a Director and hereafter at the first meeting of the Board in every Financial Yeargives a declaration that he meets the criteria of independence as provided under law.

14. COMMITTEES OF THE BOARD

Currently the Board has Six Committees:- The Audit Committee Nomination &Remuneration Committee Corporate Social Responsibility Committee StakeholdersRelationship Committee and Internal Complaints Committee Sexual Harassment Committee. AllCommittees except the Corporate Social Responsibility Committee Internal ComplaintsCommittee and Sexual Harassment Committee consist of Independent Directors.

(a) Audit Committee

The Board has constituted Audit Committee as required under Companies Act 2013. TheComposition of the Committee is as under:

Name of the Member Designation
MR. PRADEEP CHANDRAKANT SHAH Chairman
MR. ANIL NANDKISHOR BANGAD Member
MR. RAJESH RAGHUNATH BHATWAL Member

(b) Nomination and Remuneration Committee

The Board has constituted Nomination and Remuneration Committee as required underCompanies Act 2013. The Composition of the Committee is as under:

Name of the Member Designation
MR. PRADEEP CHANDRAKANT SHAH Chairman
MR. ANIL NANDKISHOR BANGAD Member
MR. SHABBIR SADRUDDIN MASANI Member

During the financial year 2020-21 Mr. Shabbir Sadruddin Masani was added to thecommittee and Mr. Rajesh Raghunath Bhatwal was resigned from the Nomination andRemuneration Committee. In terms of the provisions of Section 178(3) of the Companies Act2013 the Nomination and Remuneration Committee is responsible for formulating thecriteria for determining the qualifications attributes and Independence of a Director.The Nomination and Remuneration Committee is also responsible for recommending to theBoard a policy relating to the remuneration of the Directors Key Managerial Personnel andSenior Management. In line with the requirement the Board has adopted a Nomination andRemuneration Policy for Directors Key Managerial Personnel and Senior Management which isas follows.

(c) Stakeholder Relationship Committee:-

The Board has constituted Stakeholder Relationship Committee as required underSecurities Exchange Board of India (Listing obligations and Disclosure Requirements)Regulations 2015

("Regulations").

(d) Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee is constituted in compliance with therequirements of Section 135 of the Companies Act 2013 to undertake the below mentionedtasks:

A. To recommend the policy on Corporate Social Responsibility (CSR) andImplementation of the CSR Projects or program to be undertaken by the company as per theCSR Policy for consideration and approval by the Board of Directors. B. Recommendthe amount of expenditure to be incurred on the corporate social responsibilityactivities; and

C. Monitor the implementation of the Company's corporate social responsibilitypolicy.

During the financial year ended 31st March 2021 provision for CSR Expenses is Rs.1637595. However Company has not spent any amount on CSR due to non-availability ofgood projects. The Corporate Social Responsibility Committee comprises the following:

The Composition of the Committee is as under:

Name of the Member Designation
MR. PRADEEP CHANDRAKANT SHAH Chairman
MR. ANIL NANDKISHOR BANGAD Member
MR. RAJESH RAGHUNATH BHATWAL Member

Four meetings were held during the year 2020-21 on 22/05/2020 15/09/2020 12/12/2020and 23/02/2021.

The Company's CSR Policy statement and Annual Report on the CSR activities undertakenduring the financial year ended 31st March 2021 in accordance with section 135 of theCompanies Act 2013 and Companies (Corporate Social Responsibility Policy) Rules 2014(including any statutory modification(s) or re-enactment(s) thereof for the time being inforce) is set out in "Annexure B" to this Report.

(e) Investor Grievance Redressal Policy

The Company has adopted an internal policy for Investor Grievance handling reportingand solving.

15. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES :

Your Company is committed to highest standards of ethical moral and legal businessconduct. Accordingly the Board of Directors has formulated a Whistle Blower Policy whichis in compliance with the provisions of Section 177(10) of the Companies Act 2013.Employees can raise concerns regarding any discrimination harassment victimization anyother unfair practice being adopted against them or any instances of fraud by or againstyour Company. Any incidents that are reported are investigated and suitable action takenin line with the Whistle Blower Policy.

16. RISK MANAGEMENT POLICY

The Company has formulated a Risk Management Policy for dealing with different kinds ofrisks which it faces in day to day operations of the Company. Risk Management Policy ofthe Company outlines different kinds of risks and risk mitigating measures to be adoptedby the Board. The Company has adequate internal control systems and procedures to combatthe risk.

The Risk management procedure will be reviewed by the Audit Committee and Board ofDirectors on time to time basis.

17. POLICY ON PRESERVATION OF THE DOCUMENTS

The Company has formulated a Policy pursuant to Regulation 9 of the Securities ExchangeBoard of India (Listing obligations and Disclosure Requirements) Regulations 2015("Regulations") on

Preservation of the Documents to ensure safekeeping of the records and safeguard theDocuments from getting manhandled while at the same time avoiding superfluous inventoryof Documents.

18. POLICY ON CRITERIA FOR DETERMINING MATERIALITY OF EVENTS

The Policy is framed in accordance with the requirements of the Regulation 30 ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 (Regulations). The objective of the Policy is to determine materialityof events or information of the Company and to ensure that such information is adequatelydisseminated in pursuance with the Regulations and to provide an overall governanceframework for such determination of materiality.

19. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT

WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The company has always believed in providing a safe and harassment free workplace forevery individual working in premises and always endeavors to create and provide anenvironment that is free from discrimination and harassment including sexual harassment.

During the year ended 31st March 2021 the company has not received anycomplaint pertaining to sexual harassment.

In order to prevent Sexual Harassment of Women at Workplace a new act "The SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013"has been notified on 9th December 2013. Under the said Act every Company isrequired to set up an Internal Complaints Committee to look into complaints relating tosexual harassment at work place of any women employee.

The Company has adopted "Anti-Sexual Harassment Policy" constituted"Redressed Committee" as required under section 4 (1) of Sexual harassment ofwomen at work place (prevention prohibition and redressal ) Act 2013. During the yearunder review no complaint of harassment at the workplace was received by the Committee.

20. AUDITORS : a. Statutory Auditors:-

M/s. P. D. Dalal & Co Chartered Accountants Mumbai Firm Registration Number102047W were re-appointed as Statutory Auditors of the Company in the Annual GeneralMeeting held on 28th September 2020 to hold office until the conclusion of theupcoming Annual General Meeting. It has been recommended to re-appoint M/s. P. D. Dalal& Co. Chartered Accountants as Statutory Auditors of the Company until theconclusion of the forthcoming next Annual General Meeting of the Company.

26

In this regard the Company has received certificate from the Auditors to the effectthat if they are appointed it would be in accordance with the provisions of section 141of the Companies Act 2013. Accordingly proposal for their re-appointment as StatutoryAuditors is being placed before the shareholders for approval at the 22ndAnnual General Meeting.

b. Secretarial Auditors:

M/s. D. Sagar & Associates Aurangabad Firm of Practicing Company Secretarieshaving Membership No. F9518 and Certificate Practice No. 11547 was appointed asSecretarial Auditors of the Company as per provisions of Section 204 of the Companies Act2013 and Rules made there under for the Financial Year 2020-21. The Secretarial AuditReport for the Financial Year 2020-21 form part of the Annual Report as Annexure to theBoard Report. As the Board is satisfied with the performance of these SecretarialAuditors the Board proposes to re-appoint them as secretarial Auditors for the FinancialYear 2021-22 also.

21. AUDITORS' REPORT Statutory Audit Report:-

M/s. P. D. Dalal and Co. Chartered Accountants Mumbai Firm Registration Number102047W have issued their Report for the Financial Year ended 31st March 2021.There is one qualification reservation adverse remark or disclaimer by the StatutoryAuditors in their report. According to Note 2A(I) on the Significant Accounting Policiesthe accounting of provision of Gratuity Liability and Leave Encashment Liability is notrecorded fully and thus is not in accordance with Accounting Standard 15 on "EmployeeBenefits" issued by the Institute of

Chartered Accountants of India.

Clarification: - The Company has started making provision from current year in thebooks of accounts as reported to board by the company official.

Disclosure about Cost Audit

The Central Government has not prescribed the maintenance of Cost records under section148(1) of the Companies Act 2013 for any of the services rendered by the Company.

22. MANAGEMENT DISCUSSION ANALYSIS:-

MANAGEMENT DISCUSSION AND ANALYSIS

Forward looking statement: Statements in this Management Discussion and Analysis ofFinancial

Condition and Results of Operations of the Company describing the Company's objectivesexpectations or predictions may be forward looking within the meaning of applicablesecurities laws and regulations. Forward looking statements are based on certainassumptions and expectations of future events.

The Company cannot guarantee that these assumptions and expectations are accurate orwill be realized. The Company assumes no responsibility to publicly amend modify orrevise forward looking statements on the basis of any subsequent developmentsinformation or events. Actual results may differ materially from those expressed in thestatement. Important factors that could influence the Company's operations include changesin government regulations tax laws economic developments within the country and suchother factors globally.

The financial statements are prepared under historical cost convention on accrualbasis of accounting and in accordance with the provisions of the Companies Act 2013 (theAct) and comply with the Accounting Standards. The management of Nitiraj Engineers Limitedhas used estimates and judgments relating to the financial statements on a prudent andreasonable basis in order that the financial statements reflect in a true and fairmanner the state of affairs and profit for the year.

The following discussions on our financial condition and result of operations should beread together with our audited consolidated financial statements and the notes to thesestatements included in the annual report. Unless otherwise specified or the contextotherwise requires all references herein to "we" "us""our" "the Company" "Nitiraj" are to Nitiraj EngineersLtd.

ECONOMIC OVERVIEW Global Industry

Global Electronic Weighing Scales Market to Reach $5. 8 billion by 2027. Amid theCOVID-19 crisis the global market for Electronic Weighing Scales estimated at US $ 4.6Billion in the year 2020 is projected to reach a revised size of US$5. Tabletop Scale isprojected to record a 3% CAGR and reach US$2.2 Billion by the end of 2027. After an earlyanalysis of the business implications of the pandemic and its induced economic crisisgrowth in the Platform Scale segment is readjusted to a revised 4.4% CAGR for the next7-year period. The U.S. Market is Estimated at $1.2 Billion While China is Forecast toGrow at 6.2% CAGR. The Electronic Weighing Scales market in the U.S. is estimated atUS$1.2 Billion in the year 2020. China the world`s second largest economy is forecast toreach a projected market size of US$1.2 Billion by the year 2027 trailing a CAGR of 6.2%over the analysis period 2020 to 2027. Among the other noteworthy geographic markets areJapan and Canada each forecast to grow at 1% and 2.6% respectively over the 2020-2027period. Within Europe Germany is forecast to grow at approximately 1.7% CAGR. PrecisionScale Segment to Record 3.4% CAGR.

In the global Precision Scale segment USA Canada Japan China and Europe will drivethe 2.9% CAGR estimated for this segment. These regional markets accounting for a combinedmarket size of US$552.2 Million in the year 2020 will reach a projected size of US$676.8Million by the close of the analysis period. China will remain among the fastest growingin this cluster of regional markets. Led by countries such as Australia India and SouthKorea the market in Asia-Pacific is forecast to reach US$817.8 Million by the year 2027while Latin America will expand at a 4.3% CAGR through the analysis period. We bring yearsof research experience to this 8th edition of our report. The 297-page report presentsconcise insights into how the pandemic has impacted production and the buy side for 2020and 2021. A short-term phased recovery by key geography is also addressed.

Demand for electronic weighing machines is increasing in the commercial and residentialsectors owing to increasing economic activities technological advancements in laboratorybalances and scales and growing need to maintain precisions in process. Reliabilityaccuracy durability portability ease of calibration and extra features are acting asmajor factors for increasing adoption and penetration of electric weighing machine.Moreover these weighing machines have multiple units of measure so that units can bemeasured and converted into different units such as grams and ounces. This aforementionedfactor is shifting consumers' preference from traditional to digital/electronic weighingmachines. The laboratory-scale category is expected to expand at the fastest CAGR of 3.6%from 2020 to 2027. The segment is majorly driven by technological advancements in labscales and growing research projects in the pharmaceutical and biotech companies. In termsof revenue the online segment is expected to expand at the fastest CAGR of 3.8% from 2020to 2027. Online channels are hosted by businesses that are into e-commerce as well as bymanufacturers that have realized the potential of these channels and thus have hostedtheir websites to better cater to the customer needs. The availability of a wide range ofproducts with an option to compare them based on features and prices coupled with swiftproduct delivery and easy returns policies is anticipated to drive the segment. Consumersprefer multi-brand online retailers to save time.

Source:https://www.globenewswire.com/newsrelease/2020/08/11/2076089/0/en/Global-Electronic-Weighing-Scales-Industry.htmlhttps://www.grandviewresearch.com/industry-analysis/electronic-weighing-machines-market

Indian Industry

The economy of India is characterized as a middle income developing market economy. Itis the world's sixth-largest economy by nominal GDP and the third-largest by purchasingpower parity (PPP). According to the International Monetary Fund (IMF) on a per capitaincome basis India ranked 142nd by GDP (nominal) and 124th by GDP (PPP) in 2020. Thelong-term growth perspective of the Indian economy remains positive due to its youngpopulation and corresponding low dependency ratio healthy savings and investment ratesincreasing globalisation in India and integration into the global economy. Early 60% ofIndia's GDP is driven by domestic private consumption and continues to remain the world'ssixth-largest consumer market. India is one of the largest center's for polishing diamondsand gems and manufacturing Jewellery; it is also one of the two largest consumers of gold.After crude oil and petroleum products the export and import of gold precious metalsprecious stones gems and Jewellery accounts for the largest portion of India's globaltrade. The industry contributes about 7% of India's GDP employs millions and is a majorsource of its foreign-exchange earnings. The gems and jewellery industry created $60billion in economic output on value-added basis in 2017 and is projected to grow to $110billion by 2022.

Healthcare has become one of India's largest sector both in terms of revenue andemployment.

Healthcare comprises hospitals medical devices clinical trials outsourcingtelemedicine medical tourism health insurance and medical equipment. The Indianhealthcare sector is growing at a brisk pace due to its strengthening coverage servicesand increasing expenditure by public as well private players. The healthcare market canincrease three-fold to Rs. 8.6 trillion (US$ 133.44 billion) by 2022. Between April 2000and September 2020 FDI inflows for drugs and pharmaceuticals sector stood at US$ 16.87billion according to the data released by Department for Promotion of Industry andInternal Trade (DPIIT). Source: https://en.wikipedia.org/wiki/Economy_of_Indiahttps://www.ibef.org/industry/healthcare-india.aspx

About Nitiraj Engineers Ltd

Established in 1989 Nitiraj Engineers Ltd. is one of the leading manufacturers of widerange of Electronic Weighing Scales and Systems Currency Counting Machines and ElectronicFare Meters catering to both industrial and domestic consumption. These products areclassified according to their applications and utilities in the categories of IndustrialCommercial Jewellery Healthcare Household and Automobile. The Company supplies machinesto various state governments under Child Growth Monitoring Systems (CGMS) program. Thesemachines have advanced technology support in form of data collection plotting MIS anddissemination.

The new manufacturing facility is a sophisticated state-of-the-art facility located atDhule Maharashtra for continuous research stringent quality control and consistentproduction with a capacity to produce around six lakh scales per annum. The products aresupplied under brand name ‘PHOENIX' through a well-connected sales and servicenetwork of 17 branches in the states of Chhattisgarh Maharashtra and Odisha and about 400dealers across India as well as abroad. The Company is an ISO 9001:2015 certified companyand has more than one million customers.

The Company caters to customers ‘evolving needs effectively with a team ofqualified and experienced engineers equipped with modern facilities are engaged indesigning and developing electronic hardware and software. The Company has a well-equippedResearch & Development Department and Corporate Office situated at Dhule Maharashtra.

FINANCIAL OVERVIEW

The consolidated performance of the Company for the financial year ended March 31st2021 is as follows:

- Total revenue from operations at Rs 53.82 crore for the year ended March 31 2021 asagainst Rs. 47.86 crore for the corresponding previous period increase of 12.45% mainlyon account of increased market demand especially commercial sales and growing B2Cbusiness.

- The EBIDTA (earnings before interest depreciation and tax excluding other income)was Rs. 7.82 crore for the year ended March 31 2021 as against Rs. 3.60 crore for thecorresponding previous period increase of 117.12% mainly due to increase in sales andsale of products with lower stamping fees.

- EBITDA margins increased by 701 basis points to 14.53% in FY21 from 7.52% in FY20.

- Net Profit was at Rs. 3.63 crore in FY21 as against Rs. 2.58 crore in FY20 YoYincrease of 46.84% mainly on account of higher sales and cost cutting measures due toinnovation because of our R&D facilities.

- Net Profit margin increased by 154 basis points to 6.58 % in FY21 from 5.04% in FY20.

- EPS increased by 46.81% to Rs. 3.45 in FY21 from Rs. 2.35 in FY20.

RESOURCES AND LIQUIDITY

As on March 31 2021 the consolidated net worth stood at Rs. 72.75 crore. The cash andcash equivalents at the end of March 31 2021 were Rs. 2.31 crore. Segment wiseBusiness Performance

The Company is operating in five broad segments i.e. Electronic Weighing Scales andSystems Electronic Currency Counting Machines and Digital Fare Meters Home & HotelAutomation and Mechanical Scales. The diverse product portfolio caters to various sectors- industrial range commercial range jewellery range healthcare range household rangeautomobile range and home and hotel.

Revenue share of five broad segments are stated below:

Name and Description of main products / services % to total turnover of the Company
Electronic Weighing Scales & Systems 94.02%
Electronic Currency Counting Machines 3.04%
Digital Fare Meters 0.01%
Home & Hotel Automation 0.06%
Mechanical Scales 2.79%
COVID Protection range 0.08%

Key Recent Developments:

Migrated from NSE SME to NSE Main Board in April'21 Technological Updates:

Developed and launched "Door / Shutter Alarm" system under Security andAutomation

Products range - used for home or workplace security and gives out a loud siren onintrusion.

Developed "Platform Weighing Scale with RF Indicator" for wireless datatransmission from platform to indicator.

Updated Electromagnetic Weighing Balances with latest technology and software enablesmachines to give best performance - highly sensitive weighing balances measuring weightsof 0.1 mg accurately. Marketing Updates:

Started online sales through e-commerce platforms like Amazon.

Participated in "Divya Marathi Shopping Utsav & Auto Expo" Jalgaon from10th - 14th February 2021.

Advertised on TV newspaper ads for Home Automation and Security products.

RISKS AND CONCERNS

Like every business the company faces risks both internal and external in theundertaking of its day-to-day operations and in pursuit of its longer-term objectives. Adetailed policy drawn up and dedicated risk workshops are conducted for each businessvertical and key support functions wherein risks are identified assessed analyzed andaccepted / mitigated to an acceptable level within the risk appetite of the organization.The risk registers are also reviewed from time to time.

The Company faces the following Risks and Concerns:

? Credit Risk

To manage its credit exposure Nitiraj has determined a credit policy with credit limitrequests and approval procedures. Company does its own research of client's financialhealth and project prospects before bidding for a project. Timely and rigorous process isfollowed up with clients for payments as per schedule. The company has suitablystreamlined the process to develop a focused and aggressive receivables management systemto ensure timely collections.

? Interest Rate Risk

The Company has judiciously managed the debt-equity ratio. It has been using a mix ofloans and internal cash accruals. The Company has well managed the working capital toreduce the overall interest cost.

? Competition Risk

This risk arises from more players wanting a share in the same pie. Like in most otherindustries opportunity brings with itself competition. We face different levels ofcompetition in each segment from domestic as well as multinational companies. The Companyhas created strong differentiators in project execution quality and delivery which makeit resilient to competition. Furthermore the Company continues to invest in technologyand its people to remain ahead of the curve. A strong stable client base consisting oflarge and mid-sized corporations further helps to insulate the Company from this risk. Wecounter this risk with the quality of our infrastructure our customer-centric approachand our ability to innovate customer specific solutions focusing on pricing andaggressive marketing strategy disciplined project executions coupled with prudentfinancial and human resources management and better control over costs. Thus we do notexpect to be significantly affected by this risk.

? Input Cost Risk

Our profitability and cost effectiveness may be affected due to change in the prices ofraw materials power and other input costs. Some of the risks that are potentiallysignificant in nature and need careful monitoring are Raw Materials prices availabilityof Power etc.

? Liability Risk

This risk refers to our liability arising from any damage to equipment life and thirdparties which may adversely affect our business. The Company attempts to mitigate thisrisk through contractual obligations and insurance policies.

OPPORTUNITIES

? Huge potential in marketing of specialized weighing scales for Infant and Childcarerun by Aanganwadis and other Government establishments. ? Demand of weighing scale systemsspurred by high growth in retail and logistics sector. ? Growth in financial sector andpreference for automated currency counting and detection machines

THREATS

? Competition from local and multinational players ? Execution risk ? Regulatorychanges ? Input Cost risk ? Attraction and retention of human capital ? TechnologicalAdvancements

INTERNAL CONTROL SYSTEMS AND ADEQUACY

The Company implemented proper and adequate systems of internal control to ensure thatall assets are safeguarded and protected against loss from any unauthorized use ordisposition and all transactions are authorized recorded and reported correctly. TheCompany also implemented effective systems for achieving highest level of efficiency inoperations to achieve optimum and effective utilization of resources monitoring thereofand the compliance with provisions all laws including the Companies Act 2013 ListingAgreement directions issued by the Securities and Exchange Board of India labour lawstax laws etc. It also aimed at improvement in financial management and investment policy.The System ensures appropriate information flow to facilitate effective monitoring. Theinternal audit system also ensures formation and implementation of corporate policies forfinancial reporting accounting information security project appraisal and corporategovernance. A qualified and independent Audit Committee of the Board of Directors alsoreviews the internal control system and its impacts on improvement of overall performanceof the Company.

HUMAN RESOURCES

The Company's HR philosophy is to establish and build a high performing organizationwhere each individual is motivated to perform to the fullest capacity: to contribute todeveloping and achieving individual excellence and departmental objectives andcontinuously improve performance to realize the full potential of our personnel. As onMarch 31 2021 Company is giving direct employment to 359 employees and 144 contractualemployees. Industrial relations are cordial and satisfactory.

OUTLOOK

Our Company like every company in the world was impacted by the pandemic but itutilized its resources to the fullest during such time of need and manufactured protectiveface shields at its manufacturing facility. Our Company is receiving plentiful orders fromthe Government as well as non-Government institutions. With the new launch of the NLBseries last year our Company expects rise in its demand in the near future which willhelp the company achieve and reach its anticipated targets.

One of the major factors acting as a restraint for the electronic weighing scale marketgrowth is the requirement of electricity for the operation of the product and withoutelectricity the usage of the electronic weighing machines is not possible. This factor isinfluencing consumers to opt for a manual or spring weighing machine. Hence developingcountries facing a shortage of electricity may not have a higher adoption rate of theproduct. High maintenance costs electricity bills and high prices when compared to thetraditional and manual weighing machines are acting as major challenges for the market indeveloping countries. However our Company is highly focused on its dealer networks andafter sales service to boost brand image and build better brand image of the brand‘Phoenix' in the market. After sales service is the most important aspect a customeruses to measure brand image and for these customers to become repeat customers it isnecessary to keep them happy not only by providing best quality products at reasonablepricing but also taking care of them after the product is sold. Besides this the Companyhas also built a digital marketing team by hiring professionals to spread awareness aboutbrand Phoenix online and increase its reach to newer customers.

In such difficult times with the help of dedicated employees and experiencedManagement team our Company believes that it is well suited to take advantage of theanticipated growth in the industry.

23. CREDIT & GUARANTEE FACILITIES :-

The Company has been availing secured loans overdraft facilities and bank guaranteefacilities from HDFC Bank Limited from time to time for the business requirements.

24. INTERNAL AUDIT CONTROLS AND THEIR ADEQUACY

The Company has a proper and adequate system of internal controls commensurate withthe size scale and complexity of its operations. This ensures that all transactions areauthorized recorded and reported correctly and assets are safeguarded and protectedagainst loss from unauthorized use or disposition. In addition there are operationalcontrols and fraud risk controls covering the entire spectrum of internal financialcontrols. To maintain its objectivity and independence the Internal Audit functionreports to the Chairman of the audit committee of the Board and to the Chairman andManaging Director. The internal Audit department monitors and evaluate the efficiency andadequacy of the internal control system in the Company its compliance with operatingsystems accounting procedures and policies at all locations of the Company. Based on thereport of internal audit functions process owner undertake corrective actions in theirrespective areas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the audit committeeof the Board.

Adequacy of internal financial controls with reference to the financial statements

The Company has internal Auditors and the Audit Committee constituted are in place totake care of the same. During the year the Company continued to implement theirsuggestions and recommendations to improve the control environment. Their scope of workincludes review of processes for safeguarding the assets of the Company review ofoperational efficiency effectiveness of systems and processes and assessing the internalcontrol strengths in all areas. Internal Auditors findings are discussed with the processowners and suitable corrective actions taken as per the directions of Audit Committee onan ongoing basis to improve efficiency in operations.

25. CORPORATE GOVERNANCE

Your Company has been complying with the principles of good Corporate Governance overthe years. In compliance with Regulation 34 of the SEBI (LODR) Regulations 2015 aseparate report on Corporate Governance forms an integral part of this report asAnnexures.

Board diversity

The Company recognizes and embraces the importance of a diverse board in its success.We believe that a truly diverse board will leverage differences in thought perspectiveknowledge skill regional and industry experience cultural and geographical backgroundage ethnicity race and gender which will help us retain our competitive advantage.

26. DETAILS OF ASSOCIATES

The Company has following associated Company as per accounting standard 23 of ICAI. HYPER

DRIVE INFORMATION TECHNOLOGIES PRIVATE LIMITED (CIN U72200KA2005PTC036535) as theholding of the company directly exceeding 25% of the Share Holding and also the same isdisclosed in Part B of Annexure and also in related party as per AS 18 of the ICAI Act.

27. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

ORCOURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S

OPERATIONS IN FUTURE :.

There were no significant and material Orders passed by the Regulators or Courts orTribunals impacting the going concern status and Company's operations in future.

28.DEPOSITS FROM PUBLIC

The Company has not accepted any Deposits within the ambit of Section 73 of theCompanies Act 2013 and The Companies (Acceptance of Deposits) Rules 2014.

29.PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186

The particulars of loans guarantees and investments have been disclosed in thefinancial statements.

30.CONSOLIDATED FINANCIAL STATEMENTS:

In accordance with Accounting Standard AS-21 the Consolidated Financial Statements arefurnished herewith and form part of this Report and Accounts. The same is separatelyattached with Audit Report.

31.INSURANCE:

All the assets of the Company wherever necessary and to the extent required have beenadequately insured.

32.EMPLOYEE RELATIONS:

The relationship with the staff and workers continued to be cordial during the entireyear. The Directors wish to place on record their appreciation of the valuable work doneand co-operation extended by them at all levels. Further the Company is taking necessarysteps to recruit the required personnel from time to time.

33. STATUS OF UTILIZATION OF PROCEEDS RAISED FROM IPO :

The Company has raised an amount of Rs. 2200.80 Lacs through Initial Public Offer bygetting itself listed on the Emerge Platform of National Stock Exchange of India Limited.The table below depicts the status of the utilization of the proceeds raised by theCompany from IPO: Pursuant to the provisions of clause 43 of the listing agreement withthe exchange the disclosure is as follows:

The utilization of the issue proceeds as on 31st March 2021 is as under:

Utilization of money raised through Initial Public Offer. The utilization of the issueproceeds as on 31st March 2021 is as under: Utilization planned as perprospectus [Amt. Rs. Lac's]

Particulars Utilization planned as per prospectus Balance Amount to be utilized as on 31st March 2019 Utilization of IPO proceeds as during the FY 2019-20 Balance Amount to be utilized as on 31st March 2020 Utilization of IPO proceeds as during the FY 2020-21 Balance Amount to be utilized as on 31st March 2021
Development of new products 525.00 365.04 141.95 223.09 147.12 75.97
Setting up manufacturing Unit for the existing and new range of products 575.00 0 575.00 0 0 0
Expansion of Marketing Network and Brand building 500.00 451.44 25.00 426.44 66.43 360.01
General Corporate Purposes 500.00 0 0 0 0 0
Issue Expenses 100.80 22.92 0 22.92 0 22.92
Total 2200.80 839.40 741.95 672.45 213.55 458.90

34. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

- All transactions entered into with the related parties as defined under theCompanies Act 2013 during the financial year were in the ordinary course of businessand on arm's length pricing basis as per the management representation certificateprovided to auditor of the company and do not attract the provisions of Section 188 of theCompanies Act 2013. There are no materially significant transactions with the relatedparties during the financial year which were in conflict with the interest of the Companyand hence enclosing of form AOC- 2 is required Suitable disclosure as required by theAccounting Standards (AS 18) has been made in the notes to the Financial Statements.

35. CERTIFICATION

Company has obtained ISO 9001:2015.

36.PARTICULARS OF EMPLOYEES

There are no employees drawing remuneration in excess of the limits prescribed underRule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014. Information as required under the provisions of Rules 5(2) & 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are set outin Annexures to the Directors' Report.

37.MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THESE FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT:

There are no material changes and commitments affecting the financial position of theCompany from the financial year ended 31st March 2021 to the date of signingof the Director's Report.

38.TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there are no funds which Ire required to be transferred to InvestorEducation and Protection Fund (IEPF).

39.CORPORATE SOCIAL RESPONSIBILITY

The key philosophy of all CSR initiatives of the Company is guided by three corecommitments of

Scale Impact and Sustainability. Your Company's CSR Policy Statement and Annual Reporton the CSR Activities undertaken during the Financial Year ended 31st March2021 in accordance with Section 135 of the Companies Act 2013 and Companies (CorporateSocial Responsibility Policy) Rules 2014 is annexed to this report as Annexures.

40. INSIDER TRADING REGULATIONS

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations 1992read with SEBI (Prohibition of Insider Trading) Regulations 2015 as amended from time totime the code of conduct for prevention of insider trading and the Code for CorporateDisclosures ("Code") as approved by the Board from time to time are in forceby the Company. The objective of this Code is to protect the interest of shareholders atlarge to prevent misuse of any price sensitive information and to prevent any insidertrading activity by dealing in shares of the Company by its Directors designatedemployees and other employees. The Company also adopts the concept of Trading WindowClosure to prevent its Directors Officers designated employees and other employees fromtrading in the securities of NITIRAJ ENGINEERS LIMITED at the time when there isunpublished price sensitive information.

41. ENHANCING SHAREHOLDERS VALUE :

Your Company believes that its Members are among its most important stakeholders.

Accordingly your Company's operations are committed to the pursuit of achieving highlevels of operating performance and cost competitiveness consolidating and building orgrowth enhancing the productive asset and resource base and nurturing overall corporatereputation. Your Company is also committed to creating value for its other stakeholders byensuring that its corporate actions positively impact the socioeconomic and environmentaldimensions and contribute to sustainable growth and development.

42. OUR VISION

To be a most adorable global partner to all the stake holders in every aspect ofweighing manufacturing.

43. OUR MISSION :

By offering quality bales & premium weighing machines and timely service embeddedwith value driven culture resulting in finding new avenues to surpass global standards inevery activity that needs to nurture the society to the better tomorrow.

44. EXTRACT OF ANNUAL RETURN

In accordance with Section 134(3)(a) of the Companies Act 2013 an Extract of theAnnual Return as per Section 92 (3) of the Companies Act 2013 and Rule 12(1) of theCompanies(Management and Administration) Rules 2014 in the prescribed Format MGT-9 isappended as Annexure - 7 to the Board's Report.

45. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 (5) of the Companies Act 2013 Board of Directors of theCompany (a) In preparation of the Annual Accounts for the financial year ended 31st March2021 the applicable Accounting Standards have been followed along with proper explanationto material departures; (b) The Directors have selected Accounting Policies consulted theStatutory Auditors and applied them consistently and made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at end of the financial year and of the profit or loss of the Company for thatperiod. (c) The Directors have taken proper and sufficient care to the best of theirknowledge and ability for the maintenance of adequate accounting records in accordancewith the provisions of the Companies Act 2013 for safeguarding the assets of the Companyand for preventing and detecting fraud and other irregularities and (d) The Directors haveprepared the Annual Accounts of the company on a going concern basis; (e) The Directorshad laid down internal financial controls to be followed by the Company and that suchinternal financial controls are adequate and were operating effectively; and (f) There isa proper system to ensure compliance with the provisions of all applicable laws and thatsuch systems are adequate and operating effectively.

46. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

EARNINGS AND OUTGO :-

The particulars as prescribed under Sub Section (3)(m) of Section 134 of the CompaniesAct 2013 read with the Companies (Accounts) Rules 2014.

A. Conservation of Energy:

The Company's core activity is Production of Weighing Scales and related which is coreconsuming sector. The Company is making every effort to conserve the usage of electricity.Also in the year April 2016 Company has installed solar Electricity Plant in its CorporateOffice Dhule by which Company is trying to save electricity.

B. Technology Absorption (R&D Adaptation and Innovation):

1. Efforts in brief made towards technology absorption adaptation andinnovation:

(i) Continuous research to upgrade existing products and to develop new products andservices. (ii) To enhance its capability and customer service the Company continues tocarry out R & D activities in house.

2. Benefits derived as a result of the above efforts :

(i) Introduction of new and qualitative products. (ii) Upgrade of existing products.

3. Future plan of action:

Nitiraj will continue to invest in and adopt the best processes and methodologiessuited to its line of business and long-term strategy. Training employees in the latestappropriate technologies will remain a focus area. The Company will continue to leveragenew technologies and also on the expertise available.

C. Foreign Exchange Earnings and Outgo

The Foreign Exchange earned in terms of actual inflows during the year and the ForeignExchange outgo during the year in terms of actual Outflows (Amount In Rs)

Particulars 2020-21 2019-20
Foreign Exchange Earnings 3161313 3946921
Foreign Exchange Outgo 40902310 21883463

47. ACKNOWLEDGMENTS

Your Directors express their sincere gratitude for the assistance and co-operationextended by Banks Government Authorities Shareholders Suppliers and Customers. YourDirectors also wish to place on record their appreciation of the contribution made by theemployees at their levels towards achievements of the Company's goals.

For and on behalf of Board of Directors
NITIRAJ ENGINEERS LIMITED
Date : 04/09/2021 RAJESH BHATWAL SHAKUNTALA BHATWAL
Place : Dhule Managing Director Whole Time Director
DIN-00547575 DIN - 01953906

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