REMI EDELSTAHL TUBULARS LIMITED
Your Directors have immense pleasure in presenting the 49th Annual Reportand Audited Statements of Accounts of the Company for the year ended 31stMarch 2020.
The performance for the financial year ended 31st March 2020 is summarizedbelow:-
(Rs. in Lakhs)
| ||2019 2020 ||2018 2019 |
|Gross Turnover ||10516.07 ||12458.20 |
|Profit / (Loss) before Finance Cost Depreciation and Tax (EBIDTA) ||773.17 ||868.26 |
|Finance Cost ||276.11 ||346.85 |
|Depreciation ||471.21 ||476.59 |
|Taxation ||11.35 ||33.13 |
| ||758.67 ||856.57 |
|Profit/ (Loss) for the period ||14.50 ||11.69 |
|Other comprehensive income ||(13.01) ||6.26 |
|Profit/ (Loss) for the period (after other comprehensive income) ||1.49 ||17.95 |
|Balance brought forward ||(136.52) ||(154.48) |
| ||(135.03) ||(136.52) |
|Appropriations || || |
|Transfer to General Reserve ||-- ||-- |
|Balance carried to Balance Sheet ||(135.03) ||(136.52) |
| ||(135.03) ||(136.52) |
The Company has achieved turnover of Rs.10516.07 Lakhs during the current financialyear as against Rs.12458.20 Lakhs during the previous year. The Company has achievedEBIDTA of Rs.773.17 Lakhs during the year as against Rs.868.26 Lakhs during theprevious year. The Company has earned profit of Rs.1.49 Lakhs during the year ascompared to profit of Rs.17.95 Lakhs in the previous year. The last four years were verychallenging for the Company in view of the slowdown in Indian economy in general andnegative growth in the capital goods industry in particular. During this period variouspowers and other green field projects were either on hold or stuck due to various factorsi.e.; environmental clearance financial closure etc. and consequently as Key Component/Material Suppliers Original equipment manufacturers (OEM'S) like our company aresaddled with inventory and low business prospects. The Company is hopeful that freshcapital investment in the power refining and petro chemical sector will revive due tocontinuity of the Government at Center and is taking steps in that direction by morereforms including opening more sectors to FDI raising FDI limit of various sectors andstabilization of GST. Your Company is well positioned as efforts made into productdevelopment over the past few years have made your company one of the few manufacturers inthe country that are capable of producing tubes for the power generation industry. TheCompany is hopeful that with the introduction of policy of Aatmanirbhar Bharat ofGovernment of India demand for the Company's product will get an impetus. Certaininvestment in the Gas and Oil sector coupled with investment in power sector give hopefor revival of S.S products. The Government of India declared lockdown from third week ofMarch 2020 to contain spreading of Covid-19 pandemic in the country .Since then thelockdown has been extended by Central Govt. State govt. and local authorities consideringthe prevailing situation in the particular area. The operations of the Company wereseverally affected by way of interruption of production unavailability of workforce andtravel restrictions etc. After partial lifting of the restrictions the Company startedits operation gradually from third week of May 2020 and increased the capacity based onavailability of work force raw material and availability of transport facilities.
However impact assessment of the pandemic is a continual process given theuncertainties associated with its nature spread and duration. The Board of Directorsexpresses their inability to declare any dividend. There are no amounts proposed toreserves. There are no Companies which have become or ceased to be its Subsidiaries JointVentures or Associate Companies
BRIEF DETAILS OF DIRECTORS SEEKING APPOINTMENT /RE-APPOINTMENT:
Shri Vishwambhar C. Saraf (DIN:00161381) retire by rotation and is to be re-appointed.The brief profile is stated in the Corporate Governance Report.
Shri Vishwambhar C. Saraf and Shri Rajendra C. Saraf are brothers and Shri Rishabh R.Saraf is son of Shri. Rajendra C. Saraf. Apart from this there is no relationship betweenthe Directors inter-se.
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Act and SEBI (Listing Obligationsand Disclosure Requirements) Regulation 2015.The Board of Directors confirm that theindependent directors of the Company fulfill the conditions specified in SEBI(ListingObligations and Disclosure Requirements) Regulations 2015 and are independent of themanagement of the company.
During the year 6 (Six) Board meetings were held with gap between Meetings asprescribed under the Act. Details of Board and committee meetings held during the year aregiven in the Corporate Governance Report. POLICY ON APPOINTMENT AND REMUNERATION OFDIRECTORS:
The Board has on the recommendation of the Nomination & Remuneration Committeeformulated criteria for determining qualifications positive attributes and independenceof a Director and also a policy for remuneration of Directors Key Managerial Personneland senior management. The details of criteria laid down and the Remuneration Policy aregiven in the Corporate Governance Report.
Audited Financial Statements are prepared in accordance with Indian Accounting Standard(Ind AS) as prescribed under Section 133 of the Companies act 2013 read with the rulesmade thereof.
Shri Yatin Kumar Shah (Membership No.159796) Chartered Accountant was appointed asthe statutory auditor of the Company for a term of consecutive five years i.e; fromthe conclusion of the 46th annual general meeting till the conclusion of the 51stAnnual General Meeting by the shareholders of the Company. He has confirmed that he is notdisqualified from continuing as auditor of the Company. The statutory audit report for thefinancial year ended 31st March 2020 does not contain any qualificationreservation or adverse remark or disclaimer made by statutory auditors.
COST AUDITORS AND COST AUDIT REPORT :
Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit)Amendment Rules 2014 the cost audit records maintained by the Company are required to beaudited by cost auditors. The Board has on the recommendation of the Audit Committeeappointed M/s. Kejriwal & Associates Cost Accountants to audit the cost records ofthe Company for the financial year 2020-21 on a remuneration of Rs.60000/- (Rupees SixtyThousand only) subject to ratification by members. Accordingly a resolution seekingMembers' ratification for the remuneration payable to M/s. Kejriwal & Associates CostAuditors is included in the Notice convening the Annual General Meeting.
Shri Kamlesh Rajoria Practicing Company Secretary Kamlesh Rajoria & Associates was appointed to conduct the secretarial audit of the Company for the financial year2020-21 as required under Section 204 of the Companies Act 2013 and Rules thereunder.The secretarial audit report for FY 2019-20 forms part of the
Annual Report as "Annexure - A" to the Board's report. There is noqualification reservation or adverse remark in the report.
LOANS GUARANTEES OR INVESTMENTS:
Details of Loans Guarantees and Investments if any covered under the provisions ofSection 186 of the Act are given in the notes to the Financial Statements.
RELATED PARTY TRANSACTIONS AND POLICY ON RELATED PARTY TRANSACTIONS:
Pursuant to provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulation 2015 the Board has formulated Policy on RelatedParty Transactions and the same is available on the website of the Company at www.remigroup.com.All related party transactions that were entered into during the financial year were on anarm's length basis and were in the ordinary course of business. There is ongoing materialrelated party transactions entered by the Company during the year and thus disclosure inForm AOC-2 is required.AOC-2 forms part of the Annual Report as "Annexure - B"to the Board's report . Pursuant to Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulation 2015 there are no transaction with any person orpromoter/ promoters group holding 10% or more shareholding. None of the Non-ExecutiveDirectors has any pecuniary relationship or transactions with the Company other thansitting fees. Your Directors draw attention of the members to Note 37 to notes toaccounts which sets out related party disclosures.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION:
The details of conservation of energy technology absorption foreign exchange earningsand outgo are as follows:
A) Conservation of energy:
|i. the steps taken or impact on conservation of energy; ||: Replacement of 250W HPSV High Bay Height Fixtures with 100 W LED in plant sheds and modification in annealing furnace for improving its thermal efficiency. |
|ii. the steps taken by the company for utilizing alternate sources of energy; ||: Windmill generation at Dhule is supplied to plant through open access scheme of Govt. of Maharashtra. |
|iii. the capital investment on energy conservation equipments; ||: -- |
|(B) Technology absorption: || |
|i. the efforts made towards technology absorption; ||: The Company does not have any foreign collaboration for manufacturing. The Company is continuously modernizing its production and testing machineries and equipments. |
|ii. the benefits derived like product improvement cost reduction product development or import substitution; ||: The Company's products are Import substitutes. |
|iii. in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) ||N.A. |
|(a) the details of technology imported; ||: N.A. |
|(b) the year of import; ||: N.A. |
|(c) whether the technology been fully absorbed; ||: N.A. |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof; and ||: N.A. |
|iv. the expenditure incurred on Research and Development ||: Nil |
FOREIGN EXCHANGE EARNINGS AND OUTGO:
|Earnings : ||Rs.35.62 Lakhs |
|Outgo : ||Rs.1302.88 Lakhs |
The Composition of the Audit Committee is stated in the Corporate Governance Report.
The Company has laid down a risk management policy identifying Foreign Exchange RiskBusiness Risk and Insurance risk. The senior management team reviews and manages theforeign exchange risks in a systematic manner including regular monitoring of exposuresproper advice from market experts hedging of exposures etc. The Company's currencyhedging strategies have helped minimize volatility and have helped buffer the impact ofcurrency exchange rate fluctuations.
PERFORMANCE EVALUATION OF INDEPENDENT DIRECTOR BOARD COMMITTEES AND DIRECTORS:
Pursuant to the provisions of the Act and SEBI (Listing Obligations and DisclosureRequirements) Regulation 2015 the Board had carried out performance evaluation of itsown the Board Committees and of the Individual directors. Independent Directors at aseparate meeting evaluated performance of the Non-Independent Directors Board as a wholeand of the Chairman of the Board. The manner in which the evaluation has been carried outhas been detailed in the Corporate Governance Report.
The Company has not accepted any deposits from the public falling within the purview ofSection 73 of the Act read with the Companies (Acceptance of Deposits) Rules 2014.
INTERNAL CONTROL SYSTEM:
The Company has in place adequate internal financial controls with reference tofinancial statements. The internal financial controls are adequate and are operatingeffectively.
SIGNIFICANT AND MATERIAL ORDERS:
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
The Company has set up vigil mechanism viz. Whistle Blower Policy to enable theemployees and Directors to report genuine concerns and irregularities if any in theCompany noticed by them. No personnel has been denied access to the Audit Committee. Thesame is posted on the website of the Company.
CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT PERSONNEL
Company has received a declaration of compliance with the Code of Conduct fromDirectors and Senior Management Personnel. The declaration by the CEO & ManagingDirector affirming compliance of the Board of Directors and Senior Management Personnel tothe Code of Conduct is appended to this Report.
EXTRACT OF THE ANNUAL RETURN:
The extract of the Annual Return in form MGT-9 is placed on the Company's website at www.remigroup.com.
MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with Rule 5(1) and 5 (2) of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofemployees of the Company will be provided upon request. In terms of Section 136 of theAct the Report and Accounts are being sent to the Members and others entitled theretoexcluding the information on employees' particulars which is available for inspection bythe Members at the Registered Office of the Company during business hours on working daysof the Company up to the date of the ensuing Annual General Meeting. No employee of theCompany was in receipt of remuneration equal to or exceeding the prescribed limitspursuant to Section 197(12) of the Companies Act 2013 read with Rule 5 (2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
DIRECTORSf RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors confirm that : a. in the preparation of theannual accounts for the year ended 31st March 2020 the applicable AccountingStandards have been followed along with proper explanation relating to materialdepartures if any; b. the Directors have selected 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 thefinancial year ended 31st March 2020 and of the profit of the Company for thatperiod; c. the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;d. the Directors have prepared the annual accounts /financial statements on a goingconcern basis; e. that proper internal financial controls were in place and that thefinancial controls are adequate and were operating effectively ; and f. that the Directorshave devised proper systems to ensure compliance with the provisions of all applicablelaws and that such systems were adequate and operating effectively.
The Board extends its grateful thanks to the Investors Central and various StateGovernments its bankers and district level authorities for their continued supportextended to the Company from time to time.