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Ratnamani Metals & Tubes Ltd.

BSE: 520111 Sector: Metals & Mining
NSE: RATNAMANI ISIN Code: INE703B01027
BSE 10:37 | 17 May 1901.95 67.60
(3.69%)
OPEN

1835.30

HIGH

1939.00

LOW

1827.95

NSE 10:29 | 17 May 1909.45 84.35
(4.62%)
OPEN

1889.00

HIGH

1941.00

LOW

1829.90

OPEN 1835.30
PREVIOUS CLOSE 1834.35
VOLUME 1552
52-Week high 2141.00
52-Week low 790.05
P/E 38.00
Mkt Cap.(Rs cr) 8,892
Buy Price 1902.00
Buy Qty 2.00
Sell Price 1907.75
Sell Qty 2.00
OPEN 1835.30
CLOSE 1834.35
VOLUME 1552
52-Week high 2141.00
52-Week low 790.05
P/E 38.00
Mkt Cap.(Rs cr) 8,892
Buy Price 1902.00
Buy Qty 2.00
Sell Price 1907.75
Sell Qty 2.00

Ratnamani Metals & Tubes Ltd. (RATNAMANI) - Auditors Report

Company auditors report

To the Members of Ratnamani Metals & TubesLimited

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL

STATEMENTS

Opinion

We have audited the accompanying standalone financial statements ofRatnamani Metals & Tubes Limited (the "Company") which comprise the Balancesheet as at March 31 2020 the Statement of Profit and Loss including the statement ofOther Comprehensive Income the Cash Flow Statement and the Statement of Changes in Equityfor the year then ended and notes to the standalone financial statements including asummary of significant accounting policies and other explanatory information (hereinafterreferred to as the "standalone financial statements").

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 as amended (the "Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2020 its profit including other comprehensive income its cash flows and the changesin equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the standalone financial statements inaccordance with the Standards on Auditing (SAs) as specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the'Auditor's Responsibilities for the Audit of the Standalone FinancialStatements' section of our report. We are independent of the Company in accordancewith the 'Code of Ethics' issued by the Institute of Chartered Accountants of Indiatogether with the ethical requirements that are relevant to our audit of the financialstatements under the provisions of the Act and the Rules thereunder and we have fulfilledour other ethical responsibilities in accordance with these requirements and the Code ofEthics. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements for thefinancial year ended March 31 2020. These matters were addressed in the context of ouraudit of the standalone financial statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. For each matter belowour description of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key auditmatters to be communicated in our report. We have fulfilled the responsibilities describedin the Auditor's responsibilities for the audit of the standalone financialstatements section of our report including in relation to these matters. Accordingly ouraudit included the performance of procedures designed to respond to our assessment of therisks of material misstatement of the standalone financial statements. The results of ouraudit procedures including the procedures performed to address the matters below providethe basis for our audit opinion on the accompanying standalone financial statements.

Key audit matters How our audit addressed the key audit matter
Recoverability of Trade Receivable balances -

statements)

Trade receivables (as described in note 6 of the standalone financial
Year-end outstanding trade receivables represent balance outstanding from domestic and export customers. Our audit procedures among other things included the following:
- We obtained an understanding evaluated the design and tested the operating effectiveness of the controls related to the Trade Receivable process where we tested on a sample basis control over the customer acceptance process collection and the assessment of the recoverability of receivables;
Trade receivables by nature carry certain risks in general which include overdue balances customers in weaker economic and geopolitical environment customer's ability to pay provision in relation to expected credit loss assessment of recovery process and compliance with risk management controls. Procedures to mitigate such risks includes element of management judgment and are important to access recoverability of trade receivables.
- tested on a sample basis the aging of trade receivables at year end;
- In respect of material trade receivables balances inspected relevant contracts and correspondence with the customers wherever applicable;
- In respect of material trade receivables balances which are past due additional procedures were performed to evaluate their historical payment trends terms & conditions of customer contracts assessed whether the customers are experiencing financial difficulties and assessed expected credit loss assessment provided and impact considered by the management;
Trade receivables has been considered a key audit matter in the current year due to the significance of the amount and element of judgement involved in overall management assessment of customers' ability to repay the outstanding balances during COVID 19 disruption.
- Compared the collateral in the nature of bank guarantees/letter of credits provided by customers as applicable;
- Evaluated the nature of customers and obtained the understanding from management about whether any impact on those customers business because of COVID 19 pandemic and;
- Verified subsequent collection in relation to receivables outstanding as at March 312020.

Other Information

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Annualreport but does not include the Standalone Financial Statements and our auditor'sreport thereon.

Our opinion on the Standalone Financial Statements does not cover theother information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the Standalone Financial Statementsour responsibility is to read the other information and in doing so consider whethersuch other information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of Management for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the mattersstated in section 134(5) of the Act with respect to the preparation of these StandaloneFinancial Statements that give a true and fair view of the financial position financialperformance including other comprehensive income cash flows and changes in equity of theCompany in accordance with the accounting principles generally accepted in Indiaincluding the Indian Accounting Standards (Ind AS) specified under section 133 of the Actread with the Companies (Indian Accounting Standards) Rules 2015 as amended includingthe Companies (Indian Accounting Standards) Amendment Rules 2019. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation

and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the Standalone FinancialStatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those charged with governance are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of theStandalone Financial Statements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue to fraud or error and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance but is not a guarantee that an auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs we exercise professionaljudgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of thestandalone financial statements whether due to fraud or error design and perform auditprocedures responsive to those risks and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error as fraudmay involve collusion forgery intentional omissions misrepresentations or the overrideof internal control.

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3)

(i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate

internal financial controls with reference to financial statements inplace and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and thereasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of thegoing concern basis of accounting and based on the audit evidence obtained whether amaterial uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that amaterial uncertainty exists we are required to draw attention in our auditor'sreport to the related disclosures in the financial statements or if such disclosures areinadequate to modify our opinion. Our conclusions are based on the audit evidenceobtained up to the date of our auditor's report. However future events or conditionsmay cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements for the financial year ended March 31 2020 and are therefore the keyaudit matters. We describe these matters in our auditor's report unless law orregulation precludes public disclosure about the matter or when in extremely rarecircumstances we determine that a matter should not be communicated in our report becausethe adverse consequences of doing so would reasonably be expected to outweigh the publicinterest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order 2016("the Order") issued by the Central Government of India in terms of sub-section(11) of section 143 of the Act we give in the "Annexure 1" a statement on thematters specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143(3) of the Act we report that:

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;

(b) In our opinion proper books of account as required by law havebeen kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet the Statement of Profit and Loss including theStatement of Other Comprehensive Income the Cash Flow Statement and Statement of Changesin Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withCompanies (Indian Accounting Standards) Rules 2015 as amended including the Companies(Indian Accounting Standards) Amendment Rules 2019;

(e) On the basis of the written representations received from thedirectors as on March 31 2020 taken on record by the Board of Directors none of thedirectors is disqualified as on March 312020 from being appointed as a director in termsof Section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controlsover financial reporting of the Company with reference to these standalone financialstatements and the operating effectiveness of such controls refer to our separate Reportin "Annexure 2" to this report;

(g) In our opinion the managerial remuneration for the year endedMarch 312020 has been paid / provided by the Company to its directors in accordance withthe provisions of section 197 read with Schedule V to the Act;

(h) With respect to the other matters to be included in theAuditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors)Rules 2014 as amended in our opinion and to the best of our information and according tothe explanations given to us:

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements - Refer Note 26(b) to thestandalone financial statements;

ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts - Refer Note 32 to the standalone financialstatements;

iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company.

For S R B C & CO LLP For Kantilal Patel & Co.
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 324982E/E300003 ICAI Firm registration number: 104744W
per Pritesh Maheshwari per Jinal A. Patel
Partner Partner
Membership No.: 118746 Membership No.: 153599
UDIN: 20118746AAAABH6113 UDIN: 20153599AAAAFA5206
Place : Mumbai Place : Ahmedabad
Date : June 16 2020 Date : June 16 2020

Annexure 1 to Independent Auditors' Report

Annexure 1 referred to in Paragraph 1 of Report on Other Legal andRegulatory Requirements of our report of even date for the year ended March 31 2020

(i) (a) The Company has maintained proper records

showing full particulars including quantitative details and situationof fixed assets;

(b) All fixed assets have not been physically verified by themanagement during the year but there is a regular programme of verification which in ouropinion is reasonable having regard to the size of the Company and the nature of itsassets. No material discrepancies were noticed on such verification;

(c) According to the information and explanations given by themanagement the title deeds of immovable properties included in property plant andequipment are held in the name of the Company.

(ii) The management has conducted physical verification of inventory atreasonable intervals during the year and no material discrepancies were noticed on suchphysical verification. There was no inventory lying with third parties.

(iii) According to the information and explanations given to us theCompany has not granted any loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under section189 of the Companies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and(c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanationsgiven to us there are no loans investments guarantees and securities granted in respectof which provisions of section 185 and 186 of the Companies Act 2013 are applicable andhence not commented upon.

(v) The Company has not accepted any deposits within the meaning ofSections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules 2014 (asamended). Accordingly the provisions of clause 3(v) of the Order are not applicable.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under section 148(1) of the Companies Act 2013 related to the manufacture ofsteel tubes and pipes and are of the opinion that prima facie the specified accounts andrecords have been made and maintained. We have not however made a detailed examinationof the same.

(vii) (a) Undisputed statutory dues including provident fundemployees' state insurance income-tax duty of custom goods and service tax cessand other statutory dues have generally been regularly deposited with the appropriateauthorities though there has been a slight delay in a few cases.

(b) According to the information and explanations given to usundisputed dues in respect of central sales tax and value added tax which wereoutstanding at the year end for a period of more than six months from the date theybecame payable are as follows:

Name of the Statute Nature of the Dues Amount (' in lakhs) Period to which the amount relates Due Date($)
Central Sales Tax Act 1965 Tax Interest and Penalty 276.84 March 2009 to March 2015 Various dates
Gujarat Value Added Tax 2003 Tax and Interest 13.84 March 2012 to March 2015 Various dates

$ Amount is payable in 11 monthly installments under Vera SamadhanYojna 2019

(c) According to the records of the Company the dues outstanding ofvalue added tax sales tax excise duty and employee state insurance scheme on account ofany dispute are as follows:

Name of the Statute Nature of the dues Amount (' in lakhs) Period to which the amount relates Forum where the dispute is pending
Central Excise Act 1944 Excise Duty and Penalty 14.38* April 2012 to February 2015 Commissioner (Appeals)
204.17# March 2012 to March 2013 Central Excise and Service Tax Appellate Tribunal
Employee State Insurance Scheme Tax 424.79 November 1991 to March 2020 Hon'ble High Court of Gujarat
Finance Act1994 (Service Tax) Tax Interest and Penalty 63.56@ April 2016 to June 2017 Commissioner (Appeals)
176.13~ February 2012 to February 2013 Central Excise and Service Tax Appellate Tribunal
102.38 February 2012 to February 2013 Hon'ble High Court of Gujarat
Gujarat Value Added Tax 2003 Tax Interest and penalty 191.70“ FY 2010-11 Dy. Commissioner (Appeals)
Customs Act 1962 Tax Interest and penalty 224.54 March 2006 Hon'ble High Court of Bombay

*Net of Rs 1.16 lakhs paid under protest #Net of Rs 10.74 lakhs paidunder protest @Net of Rs 2.47 lakhs paid under protest ~ Net of Rs 9.27 lakhs paid underprotest “Net of Rs 47.87 lakhs paid under protest

(viii) In our opinion and according to the information and explanationsgiven by the management the Company has not defaulted in repayment of loans or borrowingto a bank. The Company did not have any outstanding loans or borrowings dues in respect ofa financial institution or to government or dues to debenture holders during the year.

(ix) According to the information and explanations given by themanagement the Company has not raised any money by way of initial public offer / furtherpublic offer / debt instruments and term loans hence reporting under clause (ix) is notapplicable to the Company and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the financial statements and according to theinformation and explanations given by the management we report that no fraud by theCompany or no fraud on the Company by the officers and employees of the Company has beennoticed or reported during the year.

(xi) According to the information and explanations given by themanagement the managerial remuneration has

been paid / provided in accordance with the requisite approvalsmandated by the provisions of section 197 read with Schedule V to the Companies Act 2013.

(xii) In our opinion the Company is not a nidhi company. Thereforethe provisions of clause 3(xii) of the order are not applicable to the Company and hencenot commented upon.

(xiii) According to the information and explanations given by themanagement transactions with the related parties are in compliance with section 177 and188 of Companies Act 2013 where applicable and the details have been disclosed in thenotes to the financial statements as required by the applicable accounting standardsexcept for transaction with Ratnakar Wire Private Limited aggregating Rs 6.42 lakhs forwhich the Company has obtained approval of audit committee under section 177 of theCompanies Act 2013 for subsequent ratification in the current year.

(xiv) According to the information and explanations given to us and onan overall examination of the balance sheet the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible

debentures during the year under review and hence reportingrequirements under clause 3(xiv) are not applicable to the Company and not commentedupon.

(xv) According to the information and explanations given by themanagement the Company has not entered into any non-cash transactions with directors orpersons connected with him as referred to in section

192 of Companies Act 2013. Accordingly reporting requirements underclause 3(xv) are not applicable to the Company and not commented upon.

(xvi) According to the information and explanations given to us theprovisions of section 45-IA of the Reserve Bank of India Act 1934 are not applicable tothe Company and hence not commented upon.

For S R B C & CO LLP For Kantilal Patel & Co.
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 324982E/E300003 ICAI Firm registration number: 104744W
per Pritesh Maheshwari per Jinal A. Patel
Partner Partner
Membership No.: 118746 Membership No.: 153599
UDIN: 20118746AAAABH6113 UDIN: 20153599AAAAFA5206
Place : Mumbai Place : Ahmedabad
Date : June 16 2020 Date : June 16 2020

Annexure 2 to Independent Auditors' Report

Annexure 2 referred to paragraph 2 of Report on Other Legal RegulatoryRequirements of Independent Auditor's report of even date for year ended March 312020.

Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of Companies Act 2013 ("the Act")

We have audited the internal financial controls over financialreporting of Ratnamani Metals & Tubes Limited (the "Company") as of March31 2020 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.

Management's Responsibility for InternalFinancial Controls

The Company's Management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India. Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls over financial reporting with reference to these standalonefinancial statements based on our audit. We conducted our audit in accordance with theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting (the"Guidance Note") and the Standards on Auditing as specified under section143(10) of the Companies Act 2013 to the extent applicable to an audit of internalfinancial controls and both issued by the Institute of Chartered Accountants of India.Those Standards and the Guidance Note require that we comply with ethical requirements andplan and perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls over financial reporting with reference to these standalone financialstatements was established and maintained and if such controls operated effectively in allmaterial respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls over financial reporting with reference tothese standalone financial statements and their operating effectiveness. Our audit ofinternal financial controls over financial reporting included obtaining an understandingof internal financial controls over financial reporting with reference to these standalonefinancial statements assessing the risk that a material weakness exists and testing andevaluating the design and operating effectiveness of internal control based on theassessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the financial statements whetherdue to fraud or error.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the internal financial controlsover financial reporting with reference to these standalone financial statements.

Meaning of Internal Financial Controls Over Financial Reporting WithReference to these Financial Statements

A company's internal financial control over financial reportingwith reference to these standalone financial statements is a process designed to providereasonable assurance regarding the reliability of financial reporting and the preparationof financial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financialreporting with reference to these standalone financial statements includes those policiesand procedures that (!) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a materialeffect on the financial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReporting With Reference to these Standalone Financial Statements

Because of the inherent limitations of internal financial controls overfinancial reporting with reference to these standalone financial statements including thepossibility of collusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these standalone financial statements to future periods are subject to the risk thatthe internal financial control over financial reporting with reference to these standalonefinancial statements may become //inadequate because of changes in conditions or that thedegree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls over financial reporting with reference to these standalonefinancial statements and such internal financial controls over financial reporting withreference to these standalone financial statements were operating effectively as at March31 2020 based on the internal control over financial reporting criteria established bythe Company considering the essential components of internal control stated in theGuidance Note on Audit of Internal Financial Controls Over Financial Reporting issued bythe Institute of Chartered Accountants of India.

For S R B C & CO LLP For Kantilal Patel & Co.
Chartered Accountants Chartered Accountants
ICAI Firm registration number: 324982E/E300003 ICAI Firm registration number: 104744W
per Pritesh Maheshwari per Jinal A. Patel
Partner Partner
Membership No.: 118746 Membership No.: 153599
UDIN: 20118746AAAABH6113 UDIN: 20153599AAAAFA5206
Place : Mumbai Place : Ahmedabad
Date : June 16 2020 Date : June 16 2020

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