Your Directors are pleased to present the 38th Report of Board of Directors("Board) on the business and operations of RACL Geartech Limited("Company") together with its Audited Financial Statements for the financialyear ended 31st March 2021.
The financial performance of the Company during the year under review is summarizedbelow:
| || ||(Rs in Lakh) |
|Particulars ||For the year ended 31st March 2021 ||For the year ended 31st March 2020 |
|Total Revenue ||20772.99 ||21284.52 |
|Total Expenses ||17760.11 ||19093.70 |
|Finance Costs ||847.06 ||844.22 |
|Depreciation & Amortisation ||1641.94 ||1127.73 |
|Profit before Tax ||3012.89 ||2190.82 |
|Tax Expenses: || || |
|Current Tax ||(838.59) ||(558.10) |
|Deferred Tax ||163.81 ||65.25 |
|Total Comprehensive Income for the Period ||2385.59 ||1636.27 |
|Earnings Per Share (Rs) || || |
|1. Basic ||22.13 ||15.33 |
|2. Diluted ||22.13 ||15.33 |
STATE OF AFFAIRS AND OPERATIONAL HIGHLIGHTS
During the year under review the total revenue of your Company for the year ended 31stMarch 2021 stood at ' 20772.99 Lakh as compared to the revenue generation of ' 21284.52Lakh in the previous year ended 31st March 2020. The Total Comprehensive Income of theCompany stood at ' 2385.59 Lakh for the year ended 31st March 2021 in comparison with '1636.27 Lakh in the previous year.
TRANSFER TO RESERVES
During the financial year under review there was no transfer to General Reserve by theCompany.
There was no change in the Company's Share Capital during the year under review.
The Board of Directors of the Company has declared and paid an Interim Dividend @ 10%i.e. Re. 1.00 per share to its Shareholders on 13th February 2021. Considering thegrowing operations of the Company and expansion requirements the Board of Directorsconsidered to treat the said Interim Dividend paid by the Company as the Final Dividendfor the financial year 2020-21.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
During the year under review 5 (five) meetings of the Board of Directors were held.For details of the meetings of the Board and Board Committees please refer to theCorporate Governance Report which forms part of this Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In compliance with the requirements of the Companies Act 2013 ("Act") andSEBI (Listing obligations and disclosure requirement) Regulations 2015 ("ListingRegulations") the Company as on date has 9 (Nine) Directors on Board with anoptimum mix of Executive Non Executive and Independent Directors.
During the year under review Mr. Raj Kumar Kapoor retired as the Non- ExecutiveIndependent Directors after the expiry of his second term on 29th September 2020. Mr.Shashank Ramesh Anikhindi whose term expired as an Independent Director on 28thSeptember 2020 was re-appointed as the Non- Executive Independent Director w.e.f. 29thSeptember 2020 for a second term.
The Company also appointed Brig. Harinder Pal Singh Bedi (Retd.) as an AdditionalDirector on 29th June 2020 who was confirmed as an Independent Director in the 37thAnnual General Meeting ("AGM") by the Members of the Company along with Mr.Jagdish Keswani who was appointed by the Board of Directors in its Meeting held on 11thNovember 2019 in accordance with the provisions of the Act and Listing Regulations.
Further Mrs. Malini Bansal was appointed on the Board as an Additional Director by theBoard in its Meeting held on 13th August 2021 whose appointment is required to beregularized in the ensuing AGM by the Shareholders which is being put forth in the Noticeof the AGM for their approval.
Mr. Rakesh Kapoor shall complete his second term as an Independent Director and shallretire in compliance with Section 149 of the Act.
The details of the changes in the Board and Key Managerial Personnel that took placeduring the year under review and upto the date of this Report are provided underCorporate Governance Report which forms part of this Report.
DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors of the Company have given declarations confirming that theymeet the criteria of independence as laid down under section 149(6) of the Act andListing Regulations.
RELATION BETWEEN DIRECTORS INTERSE
Except Mr. Gursharan Singh Chairman & Managing Director and Mrs. Narinder PaulKaur NonExecutive Director none of the Directors of the Company is related to the otherDirector or to any other employee of the Company.
COMMITTEES OF THE BOARD OF DIRECTORS
Your Company has following Committees of Board of Directors:
1. Audit Committee;
2. Nomination and Remuneration Committee;
3. Stakeholders' Relationship Committee;
4. Corporate Social Responsibility Committee; and
5. Financial Affairs Committee.
The role and composition of these Committees including the number of meetings heldduring the year under review and the related attendance are provided under CorporateGovernance Report which forms part of this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to section 134(5) of the Act the Board of Directors to the best of theirknowledge and ability confirm that:
a. in the preparation of the annual accounts for the year under review the applicableaccounting standards have been followed and there are no material departures.
b. they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company as on 31st March 2021 and of the profit of theCompany for the year ended 31st March 2021.
c. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and 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 by the Company andthat such internal financial controls are adequate and operating effectively.
f. they have devised proper systems to ensure compliance the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Your Company has one subsidiary namely RACL Geartech GmbH which was incorporated inAustria in February 2019. The consolidated financial statements presented by the Companyinclude the financial information of RACL Geartech GmbH and have been prepared incompliance with the applicable Accounting Standards issued by the Institute of CharteredAccountants of India ("ICAI").
The Company has no Joint Venture or Associate Company. There has been no materialchange in the nature of the business of its subsidiary.
Pursuant to provisions of Section 129(3) of the Act a separate statement containingthe salient features of the financial statements of the Company's subsidiary in Form AOC-1is attached with the financial statements of the Company.
Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate accounts in respect of RACL Geartech GmbH are available on the website of theCompany.
Pursuant to section 139 of the Act and the Rules made thereunder M/s. Gianender &Associates Chartered Accounts (ICAI Firm Regn. No. 004661N) were appointed as theStatutory Auditors of the Company for a second term of 5 (five) years with effect from theconclusion of 37th AGM upto the conclusion of the 42nd AGM on 21st September 2020.
As required under Section 139 of the Act and Companies (Audit and Auditors) Rules2014 M/s.
Gianender & Associates Chartered Accountants have confirmed and issued acertificate that their appointment shall be in accordance within the limits specifiedunder the Act and they meet the criteria for appointment as specified under Section 141 ofthe Act and they hold a valid certificate issued by the Peer Review Board of the Instituteof Chartered Accountants of India as required under Regulation 33 of the ListingRegulations.
Audit Reports on Standalone Financial Statements and Consolidated Financial Statementsare self- explanatory and do not call for any further comments under Section 134 of theCompanies Act 2013. The Auditors Report to the shareholders for the year under reviewdoes not contain any adverse qualification. No frauds have been reported by the Auditorsunder Section 143(12) of the Act requiring disclosure in the Board's Report.
As per section 204 and other applicable provisions of the Act read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Company appointedK. K. Malhotra & Co. Company Secretaries as Secretarial Auditor of the Company forthe financial year 2020-21.
However due to his sad demise on 26th April 2021 during the Audit was in processthe Board of Directors in its meeting held on 3rd May 2021 appointed Rosy Jaiswal &Associates as the Secretarial Auditors of the Company to fill in the said casual vacancy.
The Secretarial Audit Report for the financial year 2020-21 is annexed as Annexure- Aand the Report does not contain any qualification reservation adverse remark ordisclaimer. However the Auditor made certain remarks in respect of the Compliance underRegulation 31 (SAST) Regulations 2011 wherein the Company informed the Exchange of therelease of pledge of 870000 shares of Mr. Gursharan Singh after the Lockdownrestrictions were lifted in the country. Further it was observed by the Auditor that theBSE Surveillance Department had informed the Company in respect of the trading by theinsiders of the Company. The Company accordingly placed the same before the Board andAudit Committee who took cognizance of the same and took appropriate actions in thiscase. As per Regulation 7(2) of PIT Regulations the Company had reported the transactionswithin the time frame from the date of receipt of information from BSE.
Your directors are of the opinion that the aforesaid observations made by theSecretarial Auditor in their report annexed herewith are self -explanatory and do notcall for further explanation. The Company has taken due measures to keep a check on suchmatters.
Pursuant to provisions of Section 138 of the Act the Board of Directors at its Meetingheld on 12th February 2019 appointed Protiviti India Member Private Limited as InternalAuditors of the Company for a Period of 3 (Three) financial years commencing from 1stApril 2019 to 31st March 2022.
The Internal Auditors of the Company provided their reports to the Audit Committee andBoard of Directors periodically.
COST AUDIT AND MAINTENANCE OF COST RECORDS
Pursuant to Companies (Cost Records and Audit) Amendment Rules 2014 the Company is notmandatorily required to get its Cost Records for the financial year 2020-21 audited interms of provisions of Section 148 of the Act and maintenance of cost records as specifiedby the Central
Government under sub-section (1) of section 148 of the Act was also not required to bemaintained by the Company.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report highlighting the performance and prospectsof the Company's business forms part of the Annual Report.
The Company is committed towards maintaining the highest standards of CorporateGovernance and adhering to the disclosure norms as set out by the Securities and ExchangeBoard of India and other Regulatory Authorities. Your Directors re-affirm their commitmentto the corporate governance standards to the extent they are applicable to the Company. Incompliance with Regulation 34 of Listing Regulations a detailed Corporate GovernanceReport is annexed to and forms a part of this Report.
A certificate from Ms. Rosy Jaiswal Practicing Company Secretary regarding complianceconditions of Corporate Governance as stipulated in Regulation 34 read with Schedule V orother applicable provisions of the Listing Regulations has also been included in theAnnual Report.
In terms of the Act and the rules made thereunder and as per the applicable provisionsof the Listing Regulations the Board of Directors on recommendation of the Nominationand Remuneration Committee have evaluated the effectiveness of the Board. Accordingly theperformance evaluation of the Board each Director and the Committees was carried out forthe year ended 31st March 2021. The evaluation of the Directors was based on variousaspects which inter alia included the level of participation in the Board Meetingsunderstanding of their roles and responsibilities business of the Company along with theenvironment and effectiveness of their contribution.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
Except as disclosed elsewhere in the Annual Report there have been no material changesand commitments which can affect the financial position of the Company between the end offinancial year i.e. 31st March 2021 and the date of this report.
However the Company had shut its plants and offices due to the Lockdown ordered by theCentral Government amidst the Covid-19 pandemic during the year 2020-21. They weresubsequently reopened after the Lockdown lifted under Government guidelines. The Companytook all necessary measures to ensure safety of the employees and workers of the Company.All safety protocols of temperature screening wearing of safety gears social distancingsanitizing and hand washing are being adhered to very stringently.
RELATED PARTY TRANSACTIONS
All the related party transactions are entered on an arm's length basis and are incompliance with the applicable provisions of the Act and Listing Regulations. Pursuant tothe provisions of section
188 of the Act read with Rule 8 (2) of the Companies (Accounts) Rules 2014 thedetails in Form AOC-2 is annexed with this Report as Annexure- B. There are no materiallysignificant related party transactions made by the Company with Promoters Directors orKey Managerial Personnel etc. which may have potential conflict with the interest of theCompany at large. A statement of all related party transactions is presented before theAudit Committee on a periodic basis specifying the nature value and terms and conditionsof the transactions. The Related Party Transactions Policy as approved by Board onrecommendation of the Audit Committee is uploaded on the Company's website atwww.raclgeartech.com.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Your Company has an established system of internal controls. Comprehensive policiesguidelines and procedures are laid down for all business processes. The internal controlsystem has been designed to ensure that financial and other records are reliable forpreparing financial and other statements and for maintaining accountability of assets. TheBoard of Directors of your Company is satisfied with the Internal Financial Controlprocess w.r.t. financial statement and other processes. Internal control environment ofthe Company is reliable with well documented framework to mitigate risks. A detailedanalysis is provided in the Management Discussion and Analysis Report.
CORPORATE SOCIAL RESPONSIBILITY
The Company is committed to its stakeholders to conduct business in an economicallysocially and environmentally sustainable manner that is transparent and ethical. The Boardof Directors of the Company has constituted Corporate Social Responsibility("CSR") Committee in compliance with Section 135 of the Act. The Company iscommitted to inclusive sustainable development and contributing to building andsustaining economic social and environmental capital and to pursue CSR projects that arereplicable scalable and sustainable with a significant multiplier impact on sustainablelivelihood creation and environmental replenishment. The salient features of the CSRpolicy and initiatives taken by the Company on CSR activities during the year under revieware provided in the Annexure- C of this Report in the format prescribed in the Companies(Corporate Social Responsibility Policy) Rules 2014. The CSR policy is available on thewebsite of the Company at www.raclgeartech.com.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO ANDRESEARCH & DEVELOPMENT
In accordance with the requirements of Section 134(3) (m) of the Act read with Rule8(3) of the Companies (Accounts) Rules 2014 a statement showing particulars with respectto Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo areannexed hereto as Annexure- D and forms part of this Report.
In accordance with the provisions of the Act and Listing Regulations the Company hasadopted a Whistle Blower Policy as part of Vigil Mechanism to provide appropriate avenuesto the Directors and employees to bring to the attention of the management any issue whichis an actual or suspected fraud or perceived to be in violation of or in conflict with theCode of Conduct of the Company. The details of the Whistle Blower Policy are explained inthe Corporate Governance Report and also available on the website of the Company atwww.raclgeartech.com.
CODE OF CONDUCT
The Company has in place a comprehensive Code of Conduct ("the Code")applicable to Directors Independent Directors and Senior Management Personnel. The Codegives guidance and support needed for ethical conduct of business and compliance of law. Acopy of the Code is available on the Company's website at www.raclgeartech.com. TheChairman & Managing Director of the Company has given a declaration that the member ofBoard of Directors and Senior Management Personnel have affirmed compliance with the codeof conduct of the Board of directors and Senior Management in terms of Schedule V (D) ofthe Listing Regulations.
EXTRACT OF ANNUAL RETURN
In accordance with sections 134 of the Act an extract of the annual return in theprescribed format is annexed with the Annual Report as Annexure- E and is also availableon the website of the Company viz. www.raclgeartech.com.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments covered under the provisions of section186 of the Act are given in the Notes to the Financial Statements.
PARTICULARS OF EMPLOYEES
The information required under Section 197 of the Act read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as Annexure-F to this Report.
The Board on the recommendation of the Nomination and Remuneration Committee hasframed a policy for selection and appointment of Directors Key Managerial Personnel andSenior Management and their remuneration. The Remuneration Policy has been made availableon the website of the Company i.e. www.raclgeartech.com. This Policy of the Company actsas a guideline for determining inter alia qualification positive attributes andindependence of a Director matters relating to the remuneration appointment removal andevaluation of the performance of the Director Key Managerial Personnel and SeniorManagement.
The Company has identified potential risks and required mitigation measures. Majorrisks identified are systematically addressed through mitigating actions on a continuingbasis. These are discussed at the meetings of the Audit Committee of the Company. TheCompany has approved and adopted Risk Management Policy to enhance control mechanism forrisk evaluation and mitigation and the risk management process.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
The Company has in place an anti-sexual harassment policy (i.e. Prevention of SexualHarassment at Workplace) and Internal Committee in line with the requirement of the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
Internal Committee has been set up to redress complaints received regarding sexualharassment. All employees (Permanent contractual temporary and trainees) are coveredunder the aforesaid policy.
Pursuant to regulation 34 read with Schedule V of Listing Regulations requireddisclosures in relation to the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 are provided in the Corporate Governance Report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
During the year under review no significant or material orders were passed by theRegulators or Courts or Tribunals which impact the going concern status and Company'soperations in future.
ADOPTION OF INDIAN ACCOUNTING STANDARDS (IND-AS)
In accordance with the Guidelines issued by MCA and SEBI vide circularCIR/CFD/FAC/62/2016 dated 5th July 2016 the Company is mandatorily preparing itsfinancial statements along with the financial results in accordance with IND-AS asnotified by the MCA.
HEALTH SAFETY AND ENVIRONMENT
The absolute respect of Environment Health and Safety (EHS) is on the top priority ofRACL Geartech Limited.
RACL Geartech Limited gives importance to safety health and well-being of itsemployees and all the people working for the Company. Your Company is working hard toreduce the number of accidents to Zero. The Company encourages and ensures that not onlyits employees but also its subcontractors working on Company's plants as well as itssuppliers for comply with the occupational health and safety measures.
HUMAN RESOURCE AND INDUSTRIAL RELATIONS
Your Company considers people as its biggest assets and "Believing in People"is at the heart of its human resource strategy. Lot of efforts are put in for talentmanagement strong performance management learning and training initiatives in order toensure that your Company consistently develops inspiring strong and credible leadership.During the year under review your Company continued to have cordial relationship with allits employees and maintained healthy cordial and harmonious industrial relations at alllevels.
IMPACT OF COVID-19
Covid-19 consumed most of the financial year 2020-21 impacting businesses and lives ofpeople. The disruptions caused by Covid fortunately did not have any major impact on thebusiness of the Company. However your Company is cautiously looking forward to 2021-22with hopes of putting up a better show in the post-COVID-19 world although a lot willdepend on how the economy grows. In order to overcome the unprecedented challenge yourCompany adapted to the new normal to serve the customers while following the COVID-19 SOPs(Standard Operating Procedures).
The Company issued safety guidelines for its employees and workers.
- All safety protocol related to COVID-19 as advised by the government are alreadyimplemented and being followed.
- Regular Disinfection of offices and shop floors is being carried out.
- Social distancing norms being strictly followed at factories and offices.
- Sanitization and thermal screening of employees other entrants and sanitization ofloading vehicles at the entry gate of factories.
- All working area is hygienic. Sanitizer & soaps in sufficient quantity at allcommon points.
- Virtual mode of Meetings
During the year under review your Directors state that the disclosure or reporting isrequired in respect of the following items:
1. Company has not issued equity shares with differential rights as to dividend votingor otherwise.
2. Company has not issued any shares with differential rights sweat equity sharesESOS etc. to employees of the Company or to others under any scheme.
3. Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on the date of theBalance Sheet.
4. There has been no change in the nature of business of the Company during thefinancial year 2020-21.
5. Unclaimed Shares: As on 31st March 2021 the Company does not have any unclaimedshares.
6. The annual listing fee for the year under review has been paid to the stock exchangei.e. BSE Limited where your Company's shares are listed.
7. During the year under review there was no fraud in the company which was reportableto the Central Government and there was no fraud reported by the Auditors to the companyunder sub-section (12) of section 143 or other applicable provisions of the Act.
Your Directors take this opportunity to thank the Customers Financial InstitutionsBanks Central and State Government Authorities Regulatory Authorities Stock Exchangesand all the various stakeholders for their continued co-operation and support to theCompany who all made our consistent growth possible.
Your Directors also wish to record their appreciation for the continued co-operationand support extended by the governments of various countries where we have our operations.
Your Directors also wish to place on record their deep sense of gratitude for thecommitted services by the Company's executives staff and workers even in the hardesttimes.
| ||For and on behalf of the Board of Directors |
| ||For RACL Geartech Limited |
|Place: Noida ||Gursharan Singh |
|Date: 13th August 2021 ||Chairman and Managing Director DIN:00057602 |