To The Members
Your Directors have pleasure in presenting the 36th Annual Report of your Companytogether with the Audited Statement of Accounts of the Company for the financial yearended March 31 2020 and the Auditors Report thereon.
The summarised working results for the year ended March 31 2020 as compared to earlieryear are as under:
Rs. in millions
|Particulars ||2019-20 ||2018-19 |
|FINANCIAL RESULTS || || |
|Total Income ||2091.58 ||2745.60 |
|Profit Before Finance Cost Depreciation and Taxation ||55.41 ||330.39 |
|Finance Cost ||111.31 ||124.60 |
|Depreciation ||131.14 ||140.61 |
|Profit Before Tax ||(187.04) ||65.18 |
|LESS: || || |
|Tax expense || || |
|Current tax ||- ||15.11 |
|Deferred tax ||153.84 ||21.04 |
|Profit/Loss After Tax (Loss) ||(33.20) ||29.03 |
OPERATING RESULTS AND THE STATE OF COMPANY's AFFAIRS
During the year under review the overall performance of the Company showed downwardmovement as compared to the previous year. The total revenue of the company forthe yearended 31 March 2020 was Rs. 2091.58 million as compared to Rs. 2745.60 million in theprevious year. The profit before depreciation finance cost taxation is decreased to Rs.55.41 million fromRs. 330.39 million in the previous year. The net loss afterdepreciation finance cost and tax is (Rs. 33.20 million) for the current financial yearas compared to profit ofRs. 29.03 million in the previous year.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
No material changes and commitments affecting the financial position of your Companyhave occurred between the end of the financial year of the Company to which the financialstatements relate and on the date of this report. There has been no change in the natureof the business of the Company.
The Directors express their inability to declare any dividend forthe financial yearended 31 March 2020 on account of loss during the year under review.
PROSPECTS FOR THE CURRENT YEAR
Although demand for vehicles in India decreased over the past years but Inflation andconsumer sentiments do not induce great confidence either. Indian economy has beenexperiencing a slow growth phase and Low growth of GDP is expected to continue and yourCompany is expecting effect of Covid-19
impact in the coming financial year 2020-21 and future also. The economic environmentsurronded the automotive industry has become highly uncetained due to Covid-19.
The human resource profile of your Company is an optimal mix of industry experience andfresh blood from engineering and business institutions. During the year under review theCompany is renewing and updating the knowledge and skill of its employees at all levelsthrough training and development. The relationship with employees continues to be cordial.
Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 adetailed report on Corporate Governance as updated with the particulars of this financialyear is annexed to this report together with certificate of the Auditors on thecompliance with the said Code. (Annexure-I)
MANAGEMENT DISCUSSION & ANALYSIS REPORTS
In terms of the SEBI (Listing Obligations and disclosure Requirements) Regulations2015 the Management Discussion and Analysis Report is given separately and forming partof the Annual Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to the Regulation 17(1A) of SEBI (Listing Obligations and DisclosureRequirement) Regulations 2015 approval of the members were obtained for continuation ofdirectorship of Dr. Shyam Sunder Sethi and Shri A. R. Halasyam (non executive Director)who have attained the age of 75 years. The approval of shareholders at Postal Ballot andAGM obtained on 20 December 2018 and 30 September 2019 .
Dr. Shyam Sunder Sethi (DIN: 01394311) and Shri M S Ramaprasad (DIN: 00842539) werere-appointed as Independent Directors on the Board of the Company pursuant to theprovisions of Section 149 of the Act read with the Companies (Appointment andQualification of Directors) Rules 2014.They hold office as Independent Directors of theCompany up to 29 September 2024 ("second term" in line with the explanation toSections 149(10) and 149(11) of the Act).
Pursuant to Sections 152 and other applicable provisions if any of the Companies Act2013 Mrs. Deepika Kapoor Director of the Company will retire by rotation at the ensuingAnnual General Meeting and being eligible offers herself for reappointment.
Sh. Rajiv Kapoor is appointed as Chairman cum Managing Director of the Company for aterm three (3) years w.e.f. October 1 2017 and the said term will be expire on September30 2020. Re-Appointment of Mr. Rajiv Kapoor to hold office fora period of three yearsstarting from October 1 2020 to September 30 2023 is for approval of Members of theCompany at the ensuing Annual General Meeting.
Mrs. Deepika Kapoor is appointed as Wholetime Director of the Company for a term two(2) years w.e.f. December 1 2018 and the said term will be expire on November 30 2020.Re-Appointment of Mrs. Deepika Kapoor to hold office for a period of two years startingfrom December 1 2020 to November 30 2022 is for approval of Members of the Company atthe ensuing Annual General Meeting.
Formalisation programme for independent directors was completed by the company duringthe year 2019-20.
There is no change in the Key Managerial Personnel of the Company during the year underreview. At present (KMP) in the Company as per Section 2(51) and 203 of the CompaniesAct 2013 are as follows:
Mr. Rajiv Kapoor Chairman and Managing Director Mr. Gautam Bhattacgharya - ChiefFinancial Officer (CFO) Mr. Pradeep Chandra Nayak - Company Secretary (CS)
The details regarding the number of Board and Committee meeting and number of meetingsattended by the Directors has been given in detail underthe section of CorporationGovernance.
PARTICULARS W.R.T. RATIO OF REMUNERATION OF DIRECTORS AND KMP
In terms of the provisions of Section 197 of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the requiredinformation with respect to ratio of remuneration of directors key managerial personneland employees is set out as Annexure - II which forms part of this report. There were noemployees during the year under review drawing remuneration specified under Section 197of the Companies Act 2013 read with applicable rules.
STATEMENT ON DECLARATION "CERTIFICATE OF INDEPENDENCE" U/S 149 (7) FROMINDEPENDENT DIRECTORS
All Independent Directors have submitted the declaration of Independence as requiredpursuant to Section 149 (7) of the Act and including the added criteria prescribed underSEBI Listing Regulations stating that they meet the criteria of Independence as providedin section 149(6) of the Companies Act 2013 and they are not disqualified from continuingas Independent Directors of our Company.
MEETINGS OF THE BOARD
During the year 4(Four) Board Meetings were held. These Board Meetings were held on 29May 2019 10 August 2019 14 November 2019 and 14 February 2020. Details on Board and itsCommittees are erstwhile mentioned in Corporate Governance Report section of this AnnualReport.
COMMITTEES OF BOARD
Pursuantto requirement under CompaniesAct 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors has various committeesof Board such as Audit Committee Nomination & Remuneration Committee StakeholdersRelationship Committee and Corporate Social Responsibility Committee. The details ofcomposition and terms of reference of these committees are mentioned in the CorporateGovernance Report.
The composition ofAudit Committee of the Company as under:
|S Name No ||Category ||Position |
|1 Dr. ShyamSunderSethi ||Non Executive - Independent Director ||Chairman |
|2 Shri Mysore Siddappa Ramaprasad ||Non Executive - Independent Director ||Member |
|3 Shri Agharam Ramakrishnan Halasyam ||Non Executive - Independent Director ||Member |
|4 Shri Rajiv Kapoor ||Executive - Chairman cum Managing Director ||Member |
There was no instance when the recommendation of Audit Committee was not accepted bythe Board of directors.
Your Company is in Compliance with the Secretarial Standard in Meeting of the Board ofDirectors (SS-1) and Secretarial Standards on General Meeting (SS-2) for the financialyear ended 31 March 2020.
DIRECTORSRs. RESPONSIBILITY STATEMENT
Pursuant to section 134 (5) of the Companies Act 2013 the Board of Directors of theCompany hereby confirm and state that:
a) In the preparation of the annual accounts for the financial year ended 31 March2020 the applicable accounting standards had been followed along with proper explanationrelating to 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 at the end of the financial year and of the profitand loss of the Company for that period;
c) They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) They have prepared the annual accounts for financial year ended 31 March 2020 on agoing concern basis;
e) They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively duringthe financial year ended 31 March 2020; and
f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively during thefinancial year ended 31 March 2020.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In order to ensure that the activities of the Company and its employees are conductedin a fair and transparent manner by adoption of highest standards of professionalismhonesty integrity and ethical behaviour the Company has adopted a VigilMechanism/Whistle BlowerPolicy.
The Company promotes ethical behaviour in all its business activities and has put inplace a vigil mechanism for Directors Employee and other person dealing with the Companyfor reporting illegal or unethical behaviour actual or suspected fraud orviolation of thecompany's Code ofConduct.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT2013
Your Company has formulated policy for prevention of sexual harassment of its womenemployees in line with "The Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. During the year under review there were no casesfiled pursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressaljAct 2013.
CORPORATE SOCIAL RESPONSIBILITY
In compliance of the provisions of Section 135 of the Companies Act 2013 read with theCompanies (Corporate Social Responsibility Policy) Rules 2014 the Company hasconstituted a Corporate Social Responsibility Committee (Rs.CSR CommitteeRs.). The termsof reference of the Corporate Social Responsibility Committee is provided in the Report onCorporate Governance. (Annexure-lll)
POLICY ON DIRECTORSRs. APPOINTMENT REMUNERATION AND INDEPENDENT DIRECTOR
Pursuant to the requirement under Section 134(3) (e) and 178 (3) of the Companies Act2013 the brief policy on DirectorsRs. Selection appointment and remuneration is attachedas Annexure - IV which forms part of this report and the detailed policy can be referredon the website of the Company i.e.www.rasandik.com.
The Members of the Company appointed M/s. V Sankar Aiyar & Co. CharteredAccountants New Delhi having Firm Registration No. 109208W Statutory Auditors of yourCompany for a period of five years from the conclusion of 33rd Annual General Meeting(AGM) till the conclusion of the 38th AGM of the Company to be held in the year 2022.
The Audit Report does not contain any qualification reservation or adverse remarksrequiring any comment or explanation from the company. The notes on financial statementsreferred in the Auditor's Report are self explanatory. No fraud has been reported by theAuditors to the Audit Committee orthe Board.
M/s. Arun Gupta & Associates Company Secretaries New Delhi has been appointed asSecretarial Auditors of the Company for the financial year 2020-21 pursuant to
Section 204 of the Companies Act 2013. The Secretarial Audit Report and SecretarialCompliance Report under Regulation 24AA of the SEBI (LODR) Regulations 2015 submitted bySecretarial Auditors for the Financial Year 2019-20 in the prescribed form MR- 3 isattached as Annexure - C and forms part of this report. There are no qualifications orobservations or other remarks of the Secretarial Auditors in the Report issued by them forthe financial year 2019-20 which call for any explanation from the Board of Directors.
During the year under review your Company has neither accepted nor renewed anydeposits during the Financial Year 2019-20 in terms of Chapter V of the Companies Act2013.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided inAnnexure A to this Report.
ADEQUACY OF INTERNAL FINACIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The Company has in place adequate internal Financial Control with reference toFinancial Statement. The policies and procedures adopted by the company ensures orderlyand efficient conduct of the business including adherence to company's policiessafeguarding the assets prevention and detection of frauds and errors accuracy andcompleteness of the accounting records and timely preparation of reliable financialinformation.
EXTRACT OF ANNUAL RETURN:
The extract of Annual Return in Form MGT-9 as required under Section 134(3)(a) of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 is given in Annexure - B to this Report. (www.rasandik.com/report.html)
PARTICULARS OF LOANS GIVEN GUARANTEES GIVEN OR INVESTMENTS MADE UNDER SECTION 186 OFTHE COMPANIES ACT 2013
Pursuant to the requirement under Section 134(3) (g) of the Companies Act 2013 theparticulars of loans guarantees or investments under Section 186 of the Act as at end ofthe Financial Year 2019-20 are attached as Annexure - V which forms part of this report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION188(1) OF THE COMPANIES ACT 2013
The Policy on related party transactions as approved by the Board has been uploaded onthe Company's Website atwww. rasandik.com. Pursuant to the requirement under Section134(3) (h) of the Companies Act 2013 the particulars of contracts or arrangements withrelated parties referred to in section 188(1) of the Act are attached as Annexure - VIwhich forms part of this report.
The policy on materially related party transaction and on dealing with related partytransaction as approved by the Board and the detail policy can be referred on the websiteof the Company i.e. www.rasandik.com.
ANNUAL PERFORMANCE EVALUATION OF BOARD COMMITTEES AND DIRECTORS
The Companies Act 2013 and SEBI (Listing Obligation and Disclosures Requirement)Regulations 2015 stipulates the annual performance evaluation of the Directors includingChairperson Board and its Committees. Further SEBI vide its circular dated 5 January2017 issued a guidance note on Board Evaluation for listed companies. In view of the sameand in terms of Board approved Nomination and Remuneration policy the annual evaluationof Directors of their own performance Board Committees and individual directors(including Independent Directors) based on criteria for the Directors and the Board aredone through separate structured questionnaires. The Nomination and Remuneration committeehas also carried out evaluation of every director's performance. The performance of Boardand its Committees individual Directors and Chairperson were found satisfactory.
The independent directors had met separately without the presence of Non-Independentdirectors and the members of management and discussed inter alia the performance ofNon-Independent directors and Board as a whole and the performance of the Chairman of theCompany.
INFORMATION ON MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL
During the financial year ended 31 March 2020 there were no significant and materialorders passed by the regulators or courts or tribunals impacting the going concern statusof the Bank and Its operations in future.
CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The Company believes in "Zero Tolerance" against briberycorruption and unethical dealings / behaviours of any form and the Board has laid down thedirectives to counter such acts. The code laid down by the Board is known as "code ofbusiness conduct" which forms an Appendix to the Code. The Code has been posted onthe Company's website www.rasandik.com.
The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehaviour from an employee in a given situation and the reporting structure.
All the Board Members and the Senior Management personnel have confirmed compliancewith the Code.
PREVENTION OF INSIDER TRADING:
The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading Window is closed. The Board is responsible forimplementation of the Code.
All Board Directors and the designated employees have confirmed compliance with theCode.
DETAIL OF SUBSIDAIREIS JOINT VENTURES AND ASSOCIATE COMPANIES
The Company has no subsidiary joint venture or associate of the Company during theFinancial Year 2019-20.
EMPLOYEES STOCK OPTION PLANS /SCHEMES
No Employee Stock Options were granted to the Directors or Employees of the Companyduring the year under review.
All the properties of the Company including Buildings Plant and Machinery and Stockshave been adequately insured.
Your Company has been certified as an ISO/TS 169492002 version Quality System Companyby AIB Vincotte Inter Belgium and also an ISO 14001 - Environment Management SystemCompany by British International Standard (BIS).
TRANSFER TO INVESTORS EDUCATION AND POTECTION FUND
The amount represents unclaimed dividends which were lying with the Company for aperiod of more than seven years from their respective due dates of payment had transferredto the Investor Education and Protection Fund established by the Central Government incompliance with Provision of the Companies Act 2013.
Statements in the Directors Report and the Management Discussion and Analysisdescribing the Company's objectives expectations or predictions may be forward lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expresses in the statement. Important factors that couldinfluence the Company's operations included: global and domestic demand new capacityadditions changes in government policies and tax laws and other factors which arematerial to the business operation of the Company.
Your Directors take this opportunity to express their deep sense of gratitude to thebankers employees shareholders customers and suppliers for their continued support andconfidence in the management.
Your Company is grateful forthe co-operation and continued support extended by MarutiSuzuki India Ltd Tata Motors Ltd New Holland Tractors Mahindra Ashok Leyland and allother Customers. Your Directors look forward to receive their continued confidencesupport and encouragement.
Independent AuditorsRs. Certificate on Corporate Governance
To the members of Rasandik Engineering Industries
1. We have examined the compliance of regulations of Corporate Governance by RasandikEngineering Industries India Limited (Rs.the CompanyRs.) for the year ended March 31 2020as stipulated in Regulations 17 to 27 clauses (b) to (i) of Regulation 46(2) andparagraphs C D and E of Schedule V of the Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 (the Rs.ListingRegulationsRs.).
2. The compliance of conditions of corporate governance is the responsibility of themanagement. This responsibility includes the designing implementing and maintainingoperating effectiveness of internal control to ensure compliance with the conditions ofcorporate governance as stipulated in the Listing Regulations.
3. Pursuant to the requirements of the Listing Regulations our responsibility is toexpress a reasonable assurance in the form of an opinion as to whetherthe Company hascomplied with the conditions of corporate governance as stated in paragraph 2 above. Ourresponsibility is limited to examining the procedures and implementation thereof adoptedby the Company for ensuring the compliance with the conditions of corporate governance. Itis neither an audit nor an expression of opinion on the financial statements of theCompany.
4. We have examined the relevant records of the Company in accordance with theapplicable Generally Accepted Auditing Standards in India the Guidance Note onCertification of Corporate Governance issued by the Institute of Chartered Accountants ofIndia (the Rs.ICAIRs.) and the Guidance Note on Reports or Certificates for SpecialPurposes issued by the ICAI which requires that we comply with the ethical requirements ofthe Code of Ethics issued bythe ICAI.
5. We have complied with the relevant applicable requirements of the Standard onQuality Control (SQC) 1 Quality Control for Firms that Perform Audits and Reviews ofHistorical Financial Information and Other Assurance and Related Services Engagements.
6. Based on the procedures performed by us and to the best of our information andaccording to the explanations provided to us in our opinion the Company has complied inall material respects with the conditions of corporate governance as stipulated in theListing Regulations during the year ended 31 March 2020. We state that such compliance isneither an assurance as to the future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.
RESTRICTION ON USE
7. This certificate is issued solely for the purpose of complying with the aforesaidregulations and may not be suitable for any other purpose.