Your Directors are pleased to present the 57th Annual Report of theCompany along with financial statements for the year ended 31st March 2020.
1 RESULTS OF OUR OPERATIONS
Table 1 gives the financial performance of the Company for thefinancial year 2019-20 as compared to the previous financial year.
|Tablel Financial Highlights ||2019-2020 ||2018-2019 |
|Revenue from Operations || || |
|Revenue from Operations ||16812.69 ||15124.80 |
|Other Income ||720.21 ||422.02 |
|Total Income ||17532.90 ||15546.82 |
|Profit before Finance Cost depreciation exceptional items and tax ||3549.98 ||2835.02 |
|Less :Finance Cost ||1138.93 ||921.36 |
|Less :Depreciation ||1021.23 ||909.42 |
|Less :Exceptional items ||- ||61.81 |
|Profit before Tax ||1389.82 ||942.43 |
|Tax Expenses ||(339.23) ||149.11 |
|Profit after Tax ||1050.59 ||1091.54 |
RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS
The Company witnessed a growth in revenue from operations by 11.16% toRs. 168.13 crores with the operationalisation of the AMTC plant and scaling up ofcapacity. The Advanced Manufacturing & Technology Centre continues to utilize part ofits capacity for trials research and development of new products and technologies for thefuture.
Profit before finance cost depreciation and amortisation exceptionalitems and tax as a percentage of revenue from operations has improved to 21% from 18.7%in the previous year although in absolute terms it has risen by 25%.
For a detailed discussion on the Company's financial and operatingresults please refer to the Financial Performance section of the Management Discussionand Analysis Report in this Annual Report.
The Company has already commercialized major capacity of itsmanufacturing capability at the Advanced Manufacturing & Technology Centre (AMTC) inLucknow Uttar Pradesh. A substantial investment has been made in new technologies andcapabilities for this new facility effects of which are visible in the Company'sfinancial performance. However the Company has also formed a new subsidiary AerolloyTechnologies Limited for entering into the aerospace components market for which furtheroutlay of funds is envisioned. Hence the directors do not consider it prudent torecommend any dividend for the year ended on March 31 2020. The Company has also nottransferred any amount to the General Reserve during the year. The amount of Rs. 10.51crores is proposed to be retained in the Profit and Loss Account for the year ended onMarch 31 2020.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
As per the requirement of section 186(4) of Companies Act 2013particulars of loans given investments made guarantees given or securities providedalong with the purpose for which the loan or guarantee or security is proposed to beutilized by the recipient are provided in the standalone financial statements on pagenumber 123. The Company is in compliance with the limits as prescribed under Section 186of Companies Act 2013
read with rule 11 of the Companies (Meeting of Board and its Powers)Rules 2014.
RELATED PARTY TRANSACTIONS
All contracts arrangements or transactions entered by the Companyduring the financial year with related parties were in the ordinary course of business andon an arm's length basis. During the year the Company had not entered into any contractarrangement or transaction with related parties which could be considered material inaccordance with the policy of the Company on materiality of related party transactions orwhich is required to be reported in Form No. AOC-2 in terms of Section 134(3)(h) read withSection 188 of the Act and Rule 8(2) of the Companies (Accounts) Rules 2014.
The Policy on Materiality of Related Party Transactions and on dealingwith Related Party Transactions as approved by the Board is put up on the Company'swebsite and can be accessed at https://www.ptdl. com. There were no materially significantrelated party transactions which could have potential conflict with interest of theCompany at large.
The disclosures as required under Part A of Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 are provided inaccordance with Ind AS 24 in the notes to standalone financial statements.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEENTHE END OF THE FINANCIAL YEAR AND DATE OF REPORT
No material changes and commitments have occurred after the close ofthe year till the date of this Report which affect the financial position of the Company.GLOBAL PANDEMIC - COVID-19 The outbreak of Coronavirus (COVID-19) pandemic globally and inIndia is causing significant disturbance and slowdown of economic activity. In manycountries businesses are being forced to cease or limit their operations for long orindefinite periods of time. Measures taken to contain the spread of the virus includingtravel bans quarantines social distancing and closures of non-essential services havetriggered significant disruptions to businesses worldwide resulting in an economicslowdown. The world is in the midst of COVID-19 pandemic and it is yet unclear how
long its impact shall continue and affect all economic activities. Thegovernments across the world have been deploying drastic measures such as lockdowns tocontain this pandemic. This being an unprecedented crisis humankind is facing the fullassessment of the impact on the business will be possible only with the passage of time.
COVID-19 is impacting business operations of the companies by way ofinterruption in production supply chain disruption unavailability of personnel closureand lockdown of production facilities etc. On March 24 2020 the Government of Indiaordered a nationwide lockdown for 21 days which was further extended till May 3 2020 toprevent community spread of COVID-19 in India resulting in significant reduction ineconomic activities. The operations of the company were completely shut down from March22 2020 to May 10 2020. Limited plant operations started from May 11 2020 with anoperational capacity of around 30%-40%. Wherever possible the company has madearrangements for its staff to continue working from home.
Accordingly the revenue during this period and profitability of theCompany was impacted though this value cannot be quantified. The Company has availedmoratorium on loan repayment and debt servicing as extended by banks during this period.It has continued to meet all its debt and other financial obligations and incur variousfixed costs including salaries. While demand for products has been impacted since theglobal slowdown caused by COVID 19 pandemic the same is expected to pick up with timewhen the business resumes to usual pace. At present the Directors do not expect anymaterial adverse impact on the business and its prospects in the future.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
In terms of the provisions of Regulation 34 read with Schedule V Part Bof the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 theManagement's discussion and analysis is set out in this Annual Report on page 78.
The company's Advanced Manufacturing & Technology Centre (AMTC) inLucknow India has become operational and the Company is in the process of scaling up itsoperations and improving its capabilities. A number of new product lines and technologieshave been added to the Company's portfolio and these have opened up many new opportunitiesfor the business. The technologies and facilities available in this plant have created anindigenous capability for manufacture of high precision components with unparalleledquality consistency and reliability for super-critical applications. For the first timeever Titanium Casting technology and manufacturing capability is being brought to Indiaand shall provide import substitution for key components and pave the way for a new era ofAtmanirbhar Bharat. The Company's project for Rs. 51 Crores with the support of theDepartment of Heavy Industry Ministry of Heavy Industries and Public EnterprisesGovernment of India for acquisition and customisation of Technology for Development &Commercialisation of Titanium Castings with Ceramic Shelling under the TechnologyAcquisition Fund Programme (TAFP) has been completed during the year. For this projectthe department had committed partial support as a grant of Rs. 10 Crores out of a totalcost of Rs. 51 crores for a project duration of four years from the date of signing of MoUwith Global Innovation and Technology Alliance (GITA).
The AMTC Plant has already become a hallmark of excellence in coremanufacturing in the state of Uttar Pradesh. Besides bringing world class technology tothe country this plant is also incorporating the best practices for sustainablemanufacturing. This goal has been accomplished by construction of a green building with arooftop solar plant rainwater harvesting and effluent and waste treatment plants andinvestment in fume extraction and exhaust systems.
The Company has formed a 100% owned subsidiary Company named AerolloyTechnologies Limited incorporated on February 17 2020 having CIN No.U27200UP2020PLC127120. The Company has no other subsidiary associate or joint venture.The Company has formulated a Policy for determining Material Subsidiaries. The Policy isput up on the Company's website and can be accessed at www.ptcil. com.
CONSOLIDATED FINANCIAL STATEMENT
In accordance with the provisions of the act and listing regulationsread with Ind AS-110-consolidated financial statement Ind AS-28-investments in associatesand joint ventures and Ind As-31-interests in joint ventures the Company shall prepareconsolidated financial statements for the year 2020-21 as recently incorporated whollyowned subsidiary Company shall close it first annual accounts for the year ending at March31 2021.
RESEARCH AND DEVELOPMENT
The Company has already been recognized by the Department of Scientificand Industrial Research (DSIR) under the Ministry of Science & Technology Governmentof India for its in-house Research and Development facilities. DSIR has also grantedapproval to PTC Industries Limited u/s 35 (2AB) of the Income Tax Act 1961 for availingvarious incentives provided under the Act in connection with its research and developmentactivities.
The Company has successfully completed its Technology Development andDemonstration Programme (TDDP) for development and commercialization of the
RapidCast technology for manufacture of stainless steel castingsof weight up to 6000 kilograms which has become fully operational and allowed the Companyto manufacture stainless steel castings weighing upto 6000 kilograms single-piece for awide range of critical and super-critical products during the year. Additionally theCompany's project for acquisition and customisation of Technology for Development &Commercialisation of Titanium Castings with Ceramic Shelling under the TechnologyAcquisition Fund Programme (TAFP) supported by the Department of Heavy Industry Ministryof Heavy Industries and Public Enterprises Government of India has also been completedduring the year. The research and development undertaken under this project shall resultin a unique capability being created in the country for indigenous manufacture of TitaniumCastings for the first time ever. This has a very far reaching impact as Titaniumcomponents are used in a wide range of applications from aerospace chemical industriesindustrial components to medical implants.
The company's efforts into development of technologies related to 3Dprinting and additive manufacturing using metal powders have also started to yieldresults. The technologies and processes developed from these initiatives shall also have asignificant impact on the metal component industry and the manufacture of critical metalcomponents in the future.
QUALITY AND SAFETY
The Company's standards for quality safety training developmenthealth and environment have always been kept at the highest level of importance. The
Company has been employing the use of artificial intelligence dataanalytics and latest software to continuously upgrade and maintain its safety and qualityparameters.
While it already holds international quality standard certificationssuch as ISO 9001:2015 PED (Pressure Equipment directive) AD 2000 Merkblatt and variousMarine Classification Approvals along with a DSIR approved Research and Developmentlaboratory it also works on achieving higher levels of quality certifications andaccreditations.
The Company facilities reinforce its commitment to providing a safe andreliable workplace to its employees. The usage of Personal Protective Equipment (PPE) andsafety awareness of every employee is vital to an injury hazard and accident freeworkplace. Hence the Company focuses significantly on improving the efficiency of theoperations through implementation of innovative technologies and the use of global bestpractices to minimize its impact on the environment. The company continues to carry outcomprehensive reviews of its health and safety principles and put in place improvementmeasures to ensure compliance with international standards. With the induction ofqualified personnel and the management of operations by a capable senior management teamthe Company's foundations of a quality-centric work culture have also been strengthenedfor an enabling and positive work environment. The company has invested in equipment toextract dust smoke and smell in order to make the working environment clean and healthy.Every employee is tasked with ensuring safety for themselves and those around them aswell as has the right to intervene in a situation where work may be performed in an unsafemanner.
The Company utilises the power of renewable energy and measures such asrainwater harvesting to efficiently manage its operations to minimize the impact on theenvironment to preserve it for the present and future generations. It also regularlyinitiates activities to contribute positively to the communities around or near itsoperations for the wellbeing of all.
The Company's EHS department operating under an experiencedenvironmental engineer oversees compliance with various international guidelines forenvironmental health and safety.
AWARDS & RECOGNITIONS
During the year the Chairman and Managing Director of the Company Mr.Sachin Agarwal was honoured for ushering an era of positive change in Uttar Pradesh by theHonourable Governor Smt. Anandiben Patel ji Honourable Chief Minister Shri Yogi AdityaNath ji and Honourable Deputy Chief Minister Shri Dinesh Sharma ji on the occasion of UPDivas.
3 HUMAN RESOURCE MANAGEMENT
The Company believes that its primary asset is its team of highlymotivated and dedicated employees which shall be the seed for the Company's holisticgrowth and prosperity. Hence and the development of its workforce is intrinsic to itsgrowth and progress.
The efficiency of our workers has always been a key priority for theCompany as it is moving towards larger capacities and greater capabilities. PTC focuses onbusiness process optimization efficiency improvement and cost reduction continuously. TheCompany has conducted various manufacturing excellence and productivity improvementprojects throughout the year with both internal and external experts. A number of newsystems have been implemented at the shop floor and innovative manufacturing tools arebeing employed to improve the quality and efficiency of the output.
Internal and external training programs and seminars in varied fieldsrelating to management operations finance and technology are undertaken to ensure thatemployees' competencies are constantly upgraded to elevate them both personally andprofessionally. Employees are encouraged to constantly learn about technologicaldevelopments in the industry and novel approaches adopted by others in the world to update
their knowledge and skills. The employees are enabled to operate withthe latest equipment and digital tools whereby they are able to leverage their skills andknowledge for the benefit of the business. Crossfunctional training and skill developmentis constantly encouraged and employees are provided with opportunities to educate andtrain themselves across various manufacturing and functional processes . Effectivecommunication channels are maintained for meaningful interactions between the managementand staff. We continued to communicate responsively and candidly with employees and havebegun demanding the same of our next tier of leadership. We interact with employeesfrequently and collectively at least once a month to collaborate on strategy risks andexecution. Innovation is also encouraged by giving the employees just enough structure andsupport to help them navigate uncertainty and tapping into their own creative processwithout stifling it.
The management commitment to innovation remains steadfast and theCompany has created a task force focused on Technology and Innovation to spur the growthof innovative processes and ideas at the workplace. Active participation of the seniormanagement team in the activities of this task force enables them to spot inflectionpoints that may be missed by their staff and also gives them a deeper intuition when it'stime to make a decision. Apart from regular interaction the management provides ampleopportunities for inventive thoughts to come forward through exclusive pages and timedevoted to creative and innovative thinking in our in-house magazine and office functions.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Act read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 a statement showing the names of the top ten employees in terms ofremuneration drawn and names and other particulars of the employees drawing remunerationin excess of the limits set out in the said rules is placed at Annexure III and forms partof this Report.
Disclosures relating to remuneration and other details as requiredunder Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is placed at Annexure III and forms partof this Report.
4 CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of CorporateGovernance and adheres to the Corporate Governance requirements set out by the Securitiesand Exchange Board of India ("SEBI"). The Company has also implemented severalbest governance practices. The report on Corporate Governance as stipulated in Schedule VPart C of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015forms part of the Annual Report. The requisite certificate from the Practicing CompanySecretary confirming compliance with the conditions of Corporate Governance is attached tothe report on Corporate Governance.
NUMBER OF MEETINGS OF THE BOARD
The Board met five times during the financial year the details ofwhich are given in the Corporate Governance Report that forms part of this Annual Report.The intervening gap between any two meetings was within the period prescribed by theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION
The Company seeks to maintain an appropriate mix of executive andindependent directors in order to maintain the independence of the Board and segregate thefunctions of governance and management. The Board consists of professionally qualifiedindividuals from diverse backgrounds with wide experience in
business education finance and public service. As at year end theBoard consists of 10 directors one of whom is Chairman & Managing Director four areWholetime directors and five are Independent directors. Your Company in compliance withsection 178(1) of the Companies Act 2013 read with The Companies (Meeting of Board andits Powers) Rules 2014 has duly constituted a Nomination and Remuneration Committee.This committee is chaired by an independent director and formulates the criteria fordetermining qualifications positive attributes independence of a director and othermatters.
Appointment and the remuneration of Board members key managerialpersonnel or one level below the Board level is fixed on the basis of the recommendationof the Nomination and Remuneration Committee made to the Board which may ratify themwith or without modifications. Disclosures pursuant to the requirements of section 197(12)read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 have been made in Annexure III of this Board Report. The Companyaffirms that there has been no change in this policy and that the remuneration paid todirectors is as per the terms laid out in this policy.
INDUCTION AND CHANGES
The casual vacancy caused by the resignation of Ms. Shashi Vaish onFebruary 15 2019 was filled on June 01 2019 by the appointment of Ms. Smita Agarwal asa Whole-time director. Mr. Vishal Mehrotra was inducted as an Independent director on theBoard with effect from August 10 2019. The members had accorded their approval for theseappointments at previous AGM held on September 28 2019. In accordance with the provisionsof Section 152 of the Act read with
Article 158 and 159 of the Articles of Association of the Company Mr.Ashok Kumar Shukla will retire by rotation at the ensuing AGM and being eligible offerhimself for reappointment. The Board has recommended his reappointment.
During the year the Company has also bid farewell to its committed anddynamic Chief Operating Officer Mr. Anthony Rowett who has returned to the United Kingdomafter completing his three year tenure with the Company. Mr. Rowett helped PTC establishworld class infrastructure and management systems and successfully implemented a lot ofnew innovative processes and systems in the Company. The Directors would like to expresstheir gratitude and appreciation for his contribution to the growth and progress of theCompany.
Attributes Qualifications & Independence of Directors and theirAppointment
The Nomination and Remuneration Committee adopted the criteria fordetermining qualifications positive attributes and independence of Directors includingIndependent Directors pursuant to the Act and the Rules thereunder. The CorporateGovernance Policy inter alia requires that Non-Executive Directors be drawn from amongsteminent professionals with experience in business/finance/law/public administration andenterprises. The Board Diversity Policy of your Company requires the Board to have abalance of skills experience and diversity of perspectives appropriate to the Company.The skills expertise and competencies of the Directors as identified by the Board alongwith the names of directors who have such skills expertise or competence are provided inthe Report on Corporate Governance forming part of the Report and Accounts. The Articlesof Association of your Company provide that the strength of the Board shall not be fewerthan three nor more than fifteen. Directors are appointed/re-appointed with the approvalof the Members for a period of three to five years or a shorter duration in accordancewith retirement guidelines and as may be determined by the Board from time to time. AllDirectors other than Independent Directors and Managing Director are liable to retire byrotation unless otherwise approved by the Members. One-third of the Directors who areliable to retire by rotation retire every year and are eligible for re-election.
Details of the Company's Policy on remuneration
of Directors Key Managerial Personnel and other employees is providedin the Report on Corporate Governance forming part of the Report and Accounts.
DECLARATION BY INDEPENDENT DIRECTORS
As per the requirement of section 149(7) the Company has received adeclaration from every Independent Director that he or she meets the criteria ofindependence as laid down under section 149(6) read with rule 5 of the Companies(Appointment and Qualification of Directors) Rule 2014 and Regulation 25 of the SEBI(Listing Obligations and Disclosures Requirements) Regulations 2015. The IndependentDirectors of your Company have confirmed that (a) they meet the criteria of Independenceas prescribed under Section 149 of the Act and Regulation 16 of the Listing Regulations2015 (b) they are not aware of any circumstance or situation which could impair orimpact their ability to discharge duties with an objective independent judgement andwithout any external influence and (c) they have registered their names in the IndependentDirectors' Databank. Further in the opinion of the Board the Independent Directorsfulfil the conditions prescribed under the Listing Regulations 2015 and are independent ofthe management of the Company.
The Nomination and Remuneration Committee as reported in earlieryears formulated the Policy on Board evaluation evaluation of BoardCommittees'functioning and individual Director evaluation and also specified that suchevaluation will be done by the Board pursuant to the Act and the Rules thereunder and theListing
Regulations 2015. In keeping with PTC's belief that it is thecollective effectiveness of the Board that impacts Company's performance the primaryevaluation platform is that of collective performance of the Board as a whole. Boardperformance is assessed against the role and responsibilities of the Board as provided inthe Act and the Listing Regulations 2015 read with the Company's Governance Policy. TheNomination and Remuneration Committee has devised a criteria for evaluation of theperformance of the Directors including the Independent Directors. The said criteriaprovides certain parameters like attendance acquaintance with business communicationinter se between board members effective participation domain knowledge compliance withcode of conduct vision and strategy etc. which is in compliance with applicable lawsregulations and guidelines. Evaluation of functioning of Board Committees is based ondiscussions amongst Committee members and shared by the respective Committee Chairman withthe Chairman of the Nomination and Remuneration Committee who in turn shared theconsolidated report with Chairman of the Board for his review and giving feedback to eachDirector. Individual Directors are evaluated in the context of the role played by eachDirector as a member of the Board at its meetings in assisting the Board in realising itsrole of strategic supervision of the functioning of the Company in pursuit of its purposeand goals. While the Board evaluated its performance against the parameters laid down bythe Nomination and Remuneration Committee the evaluation of individual Directors wascarried out against the laid down parameters anonymously in order to ensure objectivity.Reports on functioning of Committees were placed before the Board by the CommitteeChairmen. The Independent Directors Committee of the Board also reviewed the performanceof the non-Independent Directors and the Board pursuant to Schedule IV to the Act andRegulation 25 of the Listing Regulations 2015.
KEY MANAGERIAL PERSONNEL
Pursuant to Section 203 of the Companies Act 2013 the Key ManagerialPersonnel of the Company are Mr. Sachin Agarwal Chairman & Managing Director Ms.Smita Agarwal Whole Time Director and CFO and Mr. Anuj Nigam Company Secretary.
COMMITTEES OF THE BOARD
Currently the Board has 8 (eight) committees. A detailed note on theBoard and its committees is provided in the Corporate Governance Report section of thisAnnual Report. The composition of the committees and compliances as per applicableprovisions of the Act and Rules are as follows:
|Name of the committee ||Composition of the committee ||Highlights of duties responsibilities and activities |
|Audit committee ||Dr .Rakesh Chandra Katiyar Chairperson ||All recommendations made by the committee during the year were accepted by the Board. |
| ||Mr .Brij Lal Gupta Member ||The Company has adopted the Higher Education Loan Policy for directors and employees to encourage employees to support higher education for their family members. |
| ||Mr .Krishna Das Gupta Member || |
| ||Ms .Smita Agarwal Member || |
| || ||The Company also reviewed and enforced the Related Party Transaction Policy during the year. |
|Nomination and remuneration committee ||Mr .Krishna Das Gupta Chairperson ||The Committee oversees and administers executive compensation. |
| ||Mr .Brij Lal Gupta Member || |
| ||Dr .Rakesh Chandra Katiyar Member ||The Committee recommends a criteria for evaluation of the performance of the Directors including the Independent Directors. |
| || ||All recommendations made by the committee during the year were accepted by the Board. |
|Stakeholders relationship committee ||Dr .Rakesh Chandra Katiyar Chairperson ||The Committee reviews and ensures redressal of investor grievances ratifies share transfers duplicate issue of certificates and transmissions. |
| ||Mr .Ajay Kashyap Member || |
| ||Mr .Sachin Agarwal Member ||The committee noted that no grievances of the investors have been reported during the year. |
| ||Mr .Krishna Das Gupta Member || |
|Corporate social responsibility committee ||Mr .Krishna Das Gupta Chairperson ||The Board has laid down the Company's policy on Corporate Social Responsibility (CSR). |
| ||Mr .Alok Agarwal Member || |
| ||Dr .Rakesh Chandra Katiyar Member ||The CSR policy is available on Company website www.ptcil.com |
| ||*Ms .Smita Agarwal Member || |
|Project monitoring and environment committee ||Mr .Sachin Agarwal Chairperson ||It oversees and monitors the progress of large capital expenditures and projects being implemented by the Company |
| ||Mr .Krishna Das Gupta Member || |
| ||Mr .Alok Agarwal Member || |
| || ||It monitors and oversees all the requirements which are required for the smooth establishment of the Company's new Plant Advanced Manufacturing and Technology Centre. |
| ||Mr .Ajay Kashyap Member || |
| || ||It also assesses the impact of the operations of the Company on the environment and initiates steps for the identification of potential issues and provision of support in setting a direction for improvements. |
|Banking committee ||Mr .Sachin Agarwal Chairperson ||Approval of sanction letters and/or borrowings at a time or by cumulative sum not exceeding Rs. 350000000 (Rupees thirty five crores) subject to fact that the Chairman of the Committee will place such approval at the subsequent meeting of the Board. |
| ||Mr .Alok Agarwal Member Mr .Brij Lal Gupta Member || |
| || ||Passing of resolution(s) for opening closing and operation of bank accounts with present bankers of the Company viz. State Bank of India Punjab National Bank HDFC bank Yes Bank or any of the banks in future. |
| || ||To authorise additions/deletions to the signatories pertaining to banking transactions. |
| || ||To approve investment of surplus fund for an amount not exceeding Rs. 100000000 (Rupees Ten crores) as per the policy approved by the Board. |
| || ||To approve transactions relating to foreign exchange exposure including but not limited to forward cover and derivatives products. |
| || ||Any approval and/or execution for day to day banking matters of the Company. |
| || ||To attend to any other responsibility as may be entrusted by the Board to perform any activity within terms of reference. |
|Risk management committee ||Dr .Rakesh Chandra Katiyar ||It makes recommendations to the Board to manage the risk of the Company and appraises the Board regarding any noticeable and relevant risks which can have an adverse effect on the affairs of the Company. |
| ||Chairperson || |
| ||Mr .Priya Ranjan Agarwal Member || |
| ||Mr .Brij Lal Gupta Member || |
| || ||The Risk Management Policy of the Company can be accessed at www.ptcil.com. |
|Listing committee ||Mr .Sachin Agarwal Chairperson Mr .Alok Agarwal Member Ms .Smita Agarwal Member Mr .Anuj Nigam Company Secretary ||To oversee and monitor all tasks in relation to the listing of equity shares of the Company at stock exchanges. |
* w.e.f form August 04 2020
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of section 134(3)(c) of the CompaniesAct 2013 the Directors confirm that:
(a) in preparation of the annual accounts for the year ended March 312020 the applicable accounting standards read with the requirements set out under
Schedule III of the Act have been followed and that there are nomaterial departures from the same;
(b) they have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of
the Company at the end of the financial year ended on March 31 2020and of the profit of the Company for year ended on that date;
(c) they 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;
(d) they have prepared the annual accounts on a going concern basis;
(e) they have laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and are operatingeffectively to the best of their knowledge and ability; and
(f) the Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems are adequate and are operatingeffectively.
ADOPTION OF IND-AS
In accordance with the Companies (Indian Accounting Standards) Rules2015 the Company has adopted Ind- AS for preparation of financial statements with effectfrom April 01 2017.
The Company has its equity shares listed on BSE Limited. The Companyhas paid listing fees for the year 2020-21. The Company has also established connectivitywith both depositories NSDL and CDSL.
The statutory auditors of the Company M/s Walker Chandiok & CoLLP Chartered Accountants (Reg. No.001076N/N500013) were appointed as statutory auditorsof the Company in the 56th Annual General Meeting of the Company to hold office until theconclusion of the 60th Annual General Meeting. The Chairman and Manging Director of theCompany has been empowered to decide and approve the remuneration of the Statutory Auditorfrom time to time.
The notes referred to by the auditors in their reports areself-explanatory and hence do not require any explanation. The Auditors' Report does notcontain any qualification reservation or adverse remark.
M/s Amit Gupta & Associates Practicing Company Secretaries wereappointed as secretarial auditors of the Company for the year 2019-20 as required underSection 204 of the Companies Act 2013 and Rules made thereunder. The secretarial auditreport for FY 2019-20 in Form MR3 forms part of the Annual Report at Annexure -V andcarries no qualifications reservations adverse remarks or disclaimers and hence noexplanations are required.
The Board has appointed M/s. Amit Gupta & Associates PracticingCompany Secretaries as the secretarial auditor of the Company for the financial year2020-21.
The Company maintains necessary cost records as specified by CentralGovernment under sub-section 1
of Section 148 of the Act read with the Companies (Cost Records andAudit) Rules 2014. In terms of the provisions of Section 148 of the Companies Act 2013the Company is not required to have its cost records audited by a Cost Accountant inpractice as provide under Rule 7(i) of Companies (cost records and audit) Rules 2014since the Company has revenue from exports exceeding 75% of its total turnover.
SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulatorsor courts or tribunals impacting the going concern status and the Company's operations infuture. However attention is drawn towards statements on contingent liabilities in thenotes of financial statements.
AUDIT COMMITTEE AND VIGIL MECHANISM
Pursuant to requirement of section 177(1) of Companies Act 2013 readwith Rule 6 of the Companies (Meeting of Board and its Powers) Rules 2014 and Regulation18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 theCompany has already formed the Audit Committee composition of which is covered underCorporate Governance report section of this Annual Report. The primary objective of theAudit Committee is to monitor and provide
effective supervision of the financial reporting process of theCompany and to ensure proper and timely disclosures maintaining transparency andintegrity for the shareholders.
The Vigil Mechanism of the Company provides a formal structure to allthe directors and employees to report genuine concerns and safeguard the interests of thestakeholders of the Company. PTC's vigil mechanism also incorporates a Whistle BlowerPolicy in terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 which includes the appointment of a Whistle Blower Officer who will look into thematter being reported conduct detailed investigation and take appropriate disciplinaryaction. Protected disclosures can be made by a whistle blower through an email ordedicated telephone line or a letter to the Whistle Blower Officer or to the Chairman ofthe Audit Committee. The Company's Whistle Blower policy may be accessed on the Company'swebsite at http://www. ptcil.com. During the year under review no employee was deniedaccess to Whistle Blower Officer or Audit Committee and no complaint was received.
EXTRACT OF ANNUAL RETURN
Details forming part of the extract of the Annual Return of the Companyare annexed herewith as Annexure I to this Report in Form MGT 9 as per the Companies Act2013 and Rules.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls withreference to financial statements. Internal Financial Controls are an integrated part ofthe risk management process addressing financial and financial reporting risks. Theinternal financial controls have been documented digitised and embedded in the businessprocesses.
Assurance on the effectiveness of internal financial controls isobtained through management reviews control self-assessment continuous monitoring byfunctional experts as well as testing of the internal financial control systems. Duringthe year such controls were tested by the Statutory Auditors of the Company and noreportable material weakness in the design or operation was observed.
The Company's financial discipline and prudence is reflected in thestrong credit ratings ascribed by rating agencies as given below:
|Instrument ||Rating Agency ||Rating* ||Outlook ||Remarks |
|Term loan ||India Ratings ||IND BBB ||Stable ||Rating affirmed |
|Fund Based Debt ||India Ratings ||IND BBB/Stable/IND A3+ ||Stable ||Rating affirmed |
|Non Fund Based Debt ||India Ratings ||IND A3+ || ||Rating affirmed |
*The ratings have been obtained for Borrowings only. There is no creditrating obtained by the Company for debt instruments fixed deposit program or any otherscheme involving for mobilisation of funds.
PTC aims to have a formalised and systematic approach for managingrisks across the Company. It encourages knowledge and experience sharing in order toincrease transparency on the key risks to the Company to the extent possible. Thisapproach increases risk awareness and ensures proper management of risks as part of thedaily management activities.
The Company has constituted a Risk Management Committee which has beenentrusted with the responsibility to assist the Board in:
Reviewing and approving the Company's Risk Management Policy sothat it is consistent with the Company's objectives; and
Ensuring that all the risks that the Company faces such asstrategic operational financial compliance and other risks are identified and assessedand there is an adequate risk management infrastructure in place capable of addressingthose risks.
The policy on Risk Management may be accessed on the Company's websiteat www.ptcil.com.
The objective of the Company's risk management process is to support astructured and consistent approach to identify prioritize manage monitor and report onthe principal risks and uncertainties that can impact its ability to achieve its strategicobjectives.
The Company has introduced several initiatives for risk managementincluding the introduction of audit functions and processes to identify and createawareness of risks optimal risk mitigation and efficient management of internal controland assurance activities.
The Directors state that applicable Secretarial Standards
i.e. SS-1 and SS-2 relating to 'Meetings of the Board of Directors'and 'General Meetings respectively have been duly followed by the Company.
GOING CONCERN STATUS
There is no significant or material order passed during the year by anyregulator court or tribunal impacting the going concern status of the Company or itsfuture operations.
KEY FINANCIAL RATIOS
Key Financial Ratios for the financial year ended 31st March 2020along with details of significant changes (i.e. change of 25% or more as compared to theimmediately previous financial year) in key financial ratios and the detailedexplanations are provided in the Management Discussion and Analysis report.
CHANGES IN SHARE CAPITAL
There was no change in share capital of the Company during the yearunder report.
5. CORPORATE SOCIAL RESPONSIBILITY
PTC strongly believes in the concept of sustainable development and iscommitted to operate and grow its operations in a socially and environmentally responsibleway. Our vision is to expand our operations whilst reducing the environmental impact ofour operations and increasing the positive social impact on our community.
The Company has duly constituted a Corporate Social Responsibility(CSR) Committee pursuant to the requirement of Section 135(1) of Companies Act 2013 andthe Rules made thereunder. On the recommendation of CSR committee the Board has
approved the Corporate Social Responsibility Policy which is availableon the company's website www.ptcil. com. The Board has recently approved the CSR Policy toenable CSR expenditure towards COVID 19 related projects also.
The Company has formed a trust viz. PTC Foundation in the year2014-2015 for the purpose of undertaking CSR activities exclusively. PTC Foundation shallwork along with the Board and the CSR committee in order to identify and implement CSRinitiatives of the Company. Key CSR initiatives of the Company focus on providing primaryand secondary education supporting technical learning institutes empowering womenimproving health and sanitation facilities and promoting Indian art and culture. TheCompany has spent Rs. 17.14 Lakhs for its CSR activities during the financial 2019-20.Details of initiatives taken by PTC Foundation during the year are covered in theCorporate Social Responsibility Report attached as Annexure IV to this Directors' Reportas per the requirement of Rule 9 of The Companies (Accounts) Rule 2014.
6. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS AND OUTGO
Details of conservation of energy technology absorption foreignexchange earnings and outgo in accordance with the Section 134 (3) (m) of the CompaniesAct 2013 read with Rule 8 ofThe Companies (Accounts) Rules 2014 are annexed to theDirectors' Report in Annexure VI.
7. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company's has always had a very strict policy on the sexualharassment issues and has zero tolerance in this matter. Ensuring a safe environment forits women employees is a major priority for the Company and its management. As per therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013 ("POSH Act") and Rules made thereunder the Company hasformed an Internal Committee to address complaints pertaining to sexual harassment in theworkplace. The Company policy mandates prevention of sexual harassment and to ensure afree and fair enquiry process with clear timelines for resolution. To build awareness the
Company has been conducting training programmes on a periodic basis. Inyour Company's legacy of more than 55 years no instance of sexual harassment has everbeen reported by any employee. During the year 201920 also the Company has not receivedany complaints of sexual harassment.
Your Directors state that no disclosure or reporting is required inrespect of the following matters as there were no transactions on these items during theyear under review:
Details relating to deposits covered under Chapter V of the Act.
Issue of equity shares with differential rights as to dividendvoting or otherwise.
Issue of shares (including sweat equity shares) to employees ofthe Company under any scheme including Employees' Stock Options Plan.
The Company does not have any scheme of provision of money forthe purchase of its own shares by employees or by trustees for the benefit of employees.
Neither the Managing Director nor the Whole-time Directors ofthe Company receive any remuneration or commission from any of its subsidiaries.
No significant or material orders were passed by the Regulatorsor Courts or Tribunals which impact the going concern status and Company's operations infuture.
No fraud has been reported by the Auditors to the AuditCommittee or the Board.
This Report contains forward-looking statements that involve risks anduncertainties. When used in this Report the words 'anticipate 'believe 'estimate'expect 'intend 'will' and other similar expressions as they relate to the Companyand/or its Businesses are intended to identify such forward-looking statements. TheCompany undertakes no obligation to publicly update or revise any forward-lookingstatements whether as a result of new information future events or otherwise. Actualresults performances or achievements could differ materially from those expressed orimplied in such forward-looking statements. Readers are cautioned not to place unduereliance on these forward-looking statements that speak only as of their dates. ThisReport should be read in conjunction with the financial statements included herein and thenotes thereto. ACKNOWLEDGEMENTS
The Board of Directors thank the bankers of the Company otherfinancial institutions the Government of India the State Governments and the governmentagencies for their guidance and continued support extended to the Company throughout theyear. We look forward to having the same support in our endeavour to better the lives ofall those who are associated with the Company.
The Board of Directors also place on record their sincere appreciationfor the significant contribution made by its employees workers and outside professionalsthrough their dedication hard work and commitment exhibited in the overall developmentgrowth and prosperity of the Company.
On behalf of the Board of Directors
|Place: Lucknow ||Sachin Agarwal ||Alok Agarwal |
|Date: August 04 2020 ||Chairman & Managing Director ||Director - Quality & Technical |