Your Directors have pleasure in presenting the 71st Annual Report on the business andoperations of your Company together with the audited Financial Statements for the yearended March 31 2019:
|Financial Results and State of Affairs || ||(Rs in Lakhs) |
| ||Financial Year ended March 31 2019 ||Financial Year ended March 31 2018 |
|Revenue from Operations ||25171.72 ||21318.17 |
|Other Income ||734.67 ||207.10 |
|Profit Before Depreciation Finance Costs Exceptional items and Tax Expenses ||2432.62 ||1635.29 |
|Less : Depreciation/Amortization/Impairment ||213.11 ||202.73 |
|Profit Before Finance Costs Exceptional items and Tax Expenses ||2219.51 ||1432.56 |
|Less: Finance Costs ||1422.72 ||856.01 |
|Profit before Exceptional Items and Tax Expenses ||796.79 ||576.55 |
|Add/Less Exceptional Items ||0 ||0 |
|Profit Before Tax Expense ||796.79 ||576.55 |
|Less: Tax Expenses || || |
|Current Tax ||258.00 ||185.35 |
|Add: Deferred Tax Charge/Credit ||-11.49 ||-27.02 |
|Profit for the year ||550.28 ||418.22 |
|Other Comprehensive Income (Net of Tax) ||9.08 ||49.87 |
|Total ||559.36 ||468.09 |
Material Changes and commitments if any affecting financial position of the Companyfrom the end of the Financial Year and till the date of this Report
No material changes and commitments affecting the financial position of your Companyoccurred between the end of the Financial Year of your Company to which the FinancialStatements relate and the date of this Report.
Further it is confirmed that there has been no change in the nature of business ofyour Company.
The Board of Directors has proposed to retain the entire amount of Profit of Rs 5.59Crores for expansion and further growth of your Company and therefore has notrecommended payment of any Dividend.
Your Company is once again pleased to present an improved operational performance inthe present year over the previous Financial Year. Net Revenue from Operations for theyear was Rs 252 crores as compared to Rs 213 crores in the previous year resulting in anincrease of 18.30 %. Profit Before Tax also saw an increase of 38.37 % to Rs 7.97 croresas against Rs 5.76 crores in the previous year. Correspondingly the carried forwardprofit also increased by 19.44 % to Rs 5.59 crores over Rs 4.68 crores in the previousyear.
This year your Company surpassed its previous highest turnover. Your Company continuesto do well and consolidate its performance. Healthy mix of orders diversified customerbase and a pan India presence have helped your Company to achieve this performance. YourCompany will aim to expand its portfolio of products and services to meet customerexpectations and company objectives. Your Company shall also endeavor to expand itsgeographical reach and increase its global foot print.
As the Indian economy faces various headwinds your Company remains cautiouslyoptimistic. As a clearly spelt out strategy the Company will continue to remain prudentand cautious with its borrowings. The Company aims to increase business not by excessiveexternal borrowings but from its own reserves. Your Company has once again increased saleswithout corresponding increase in debt.
Your Company has focused on improving its Balance Sheet and these efforts have bornefruit. Noncurrent borrowings are down from Rs 2.09 Crores to Rs 0.51 Crores. Currentborrowings are down from 32.03 Crores to 30.55 Crores. The biggest improvements has been a45.18 % reduction in Trade Payables from Rs 79.38 Crores to Rs 43.52 Crores despite anincrease in Sales. These are all healthy signs for your Company. The focus of your Companyfor the past few years has been on growth while strengthening its financials. Themanagement is committed to the growth of the Company without relying on excessiveborrowings.
Your Company remains focused on achieving higher sales by targeting profitablesegments. Demand for your Company's products remain moderate.
With the return of the present Government to power at the Centre with an increasedmajority the country can look forward to a period of stability and certainty in policy.The Government has already spelled out its priority so far as the power sector isconcerned.
With a near total village and household electrification having been achieved it shallendeavour to provide stable and continuous power to all Indians.
This should translate into huge investments in strengthening the Grid particularly thedistribution network which will offer your Company which primarily operates in thissegment many exciting opportunities. The health of Distribution companies (DISCOMS)remains an area of concern. Therefore for the Government to properly implement its plansthis issue needs to be addressed.
As long as the Government's investment in the Power Sector remains high demand foryour Company's products will continue to rise.
During the year under review your Company has issued and allotted 1000000 EquityShares to Companies of Promoters Group on preferential basis on March 18 2019 resultingin an increase of Paid Up Equity Share Capital of your Company from Rs 8.17 Crores to Rs9.17 Crores as on March 31 2019.
There has been no change in the Authorized Share Capital of your Company which remainsat Rs 22 Crores.
Your Company has neither issued Shares with differential voting rights nor grantedStock Options nor Sweat Equity Shares.
Your Company has not made any buy-back of its own Equity Shares.
Preferential Issue of Equity Shares
The Board of Directors of your Company in its Meeting held on February 4 2019 hadapproved subject to the approval of the Shareholders of the Company the offer of upto1000000 (Ten Lakh) fully paid up Equity Shares of the Company having a Face Value of Rs10/- each for an aggregate amount of upto Rs 40000000 (Rupees Four Crores) to twoPromoter Group Companies on a preferential basis by way of private placement inaccordance with the Securities and Exchange Board of India (Issue of Capital andDisclosure Requirement) Regulations 2018 as amended ("ICDR Regulations") andapplicable provisions of the Companies Act2013(the Act) and Rules thereunder.
The requisite approval was received from the Shareholders in the Extraordinary GeneralMeeting held on March 13 2019 (last date of the Postal Ballot) and 1000000 fully paidEquity shares having a Face Value of Rs. 10/- each at a price of Rs. 34/- per shares foran aggregrate amount of Rs. 340 Lakhs were issued and allotted to Companies of thePromoters Group on March 182019.
Your Company had applied to BSE for subsequent listing and trading approvals for thesame. BSE has accorded their approvals in this respect and 1000000 Equity Shares havebeen admitted to the Share Capital of the Company.
Both CDSL and NSDL have been informed about this admission through necessary corporateactions.
Redemption of Preference Shares
The Board of Directors of your Company in its Meeting held on January 212019 hadapproved redemption of 7500000 (Seventy Five lakh) 9% Non-cumulative non-participatingRedeemable Preference Shares of the Company at par aggregating to Rs. 75000000/- interms of the Letter of Offer issued to the Preference Shareholders. These PreferenceShares have been redeemed on January 29 2019.
During the year your Company has improved its long term Bank facility Credit rating toBB+ (Stable) from BB by CARE Ratings Limited vide its letter dated November 292018. YourCompany's short term Bank facilities Credit has improved from A 4 to A4+.
The revision in the ratings assigned to the Bank facilities of the Company takes intoaccount signi!cant growth in the scale of operations during Financial Year 2018-2019 aswell as improvement in its debt coverage indicators and operating cycle during FinancialYear 2018-2019.
The letter containing the revision in the credit ratings is available in the Company'sCorporate Website www.rtspower.com.
Energy Conservation Technology Absorption & Foreign Exchange Earnings and Outgo
Monitoring and control of consumption of sources of energy like power oil etc.continued to be a priority area of your Company. Energy conservation procedures also forman important part of your Company's operational practices. No alternative sources ofenergy has so far been utilized. There is no capital investment during the year underreview on energy conservation equipment.
Your Directors have nothing to report in the matter of Technology Absorption since yourCompany has neither hired nor imported any technology from outside sources.
Your Company has no Research and Development (R&D) Department and has not spent anyamount on R& D during the Financial Year.
Your Company had an Export turnover of Rs 849.41 Lakhs lower than that of the previousyear. This was mainly on account of non-availability of foreign currency in some of theexporting countries.
The Foreign Exchange outgo during this year was as follows:
|Expenditure in Foreign Currency || |
|Foreign Travelling ||Rs 12.30 Lakhs |
Indian Accounting Standards
Your Company has adopted Indian Accounting Standards (Ind AS') with effect fromApril 12017. Financial Statements for the year ended March 31 2019 have been prepared inaccordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules2015 (as amended) read with Section 133 and other applicable provisions of the CompaniesAct 2013.
The Board of Directors (the Board) of your Company consists of a balanced profile ofMembers specializing in different fields that enables the Board to address the variousbusiness needs of your Company while placing very strong emphasis on corporategovernance.
(a) Appointment /Resignation of Directors
There was no change in Directors of your Company during the year under review.
(b) Independent Directors
Your Company has at present two Independent Directors namely Shri Sardul Singh Jain(DIN 00013732) and Shri Alok Kumar Banthia (DIN 00528159) which meets the requirements ofboth the Companies Act 2013 (the Act) and the Rules made thereunder as well as theprovisions contained in Regulation 17(b) of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations2015 (hereinafter referredto as " Listing Regulations"). They are not liable to retire by rotation.
Your Company has received necessary declarations from the above mentioned IndependentDirectors under Section 149(7) of the Act confirming that they meet the criteria ofindependence as prescribed both under Sub-Section(6) of Section 149 of the Act and underRegulation 16(b) of the Listing Regulations.
(c) Re-appointment of Independent Directors
Pursuant to the provisions of the Companies Act the Members at the 66th Annual GeneralMeeting of the Company held on September 30 2014 had appointed Shri Sardul Singh Jain(DIN 00013732) and Shri Alok Kumar Banthia (DIN 00528159) as Independent Directors to holdoffice for five consecutive years for a term upto the conclusion of 71st Annual GeneralMeeting of the Company to be held in 2019.
Both Shri Sardul Singh Jain (DIN 00013732) and Shri Alok Kumar Banthia (DIN 00528159)retire at the conclusion of the forthcoming Annual General Meeting of the Company andbeing eligible offer themselves for re-appointment as Independent Directors for a secondterm.
The current five year term of appointment of Shri Sardul Singh Jain (DIN 00013732) andShri Alok Kumar Banthia (DIN 00528159) as Independent Directors of the Company will expireon 30th September2019. It is proposed to re-appoint them as Independent Directors notliable to retire by rotation for a fresh five year term with effect from 1St October2019 in accordance with the applicable provisions of the Act and Rules made thereunder.
Special Resolutions along with the Explanatory Statement proposing their re-appointmentare included as a part of the Notice convening the Seventy First Annual General Meeting.
Also Special Resolution along with the Explanatory Statement seeking approval of theMembers for holding of office of Shri Sardul Singh Jain (DIN 00013732) who has attainedthe stipulated age of 75 years as I ndependent Director of your Company is included as apart of the Notice convening the Seventy First Annual General Meeting.
(d) Retirement of Director by rotation
As per the provisions of the Companies Act 2013 and the Articles of Association of theCompany Smt Rachna Bhutoria (DIN 00977628) Director of your Company will retire byrotation at the forthcoming Annual General Meeting and being eligible offers herself forre-appointment. A Resolution seeking Members' approval for her re-appointment forms a partof the Notice convening the Seventy First Annual General Meeting.
(e) Meetings of the Board and its Committees
The number and dates of Meetings of the Board and its Committees thereof and theDirectors' present therein have been given in the Report on Corporate Governance attachedherewith.
(f) Separate Meetings of Independent Directors
As per stipulation in Clause VII of the Code for Independent Directors in Schedule IVof the Companies Act 2013 and as per Regulation 25(3) of the Listing Regulationsseparate Meetings of the Company's Independent Directors was held on October 19 2018 andJanuary 18 2019 without the attendance of Non-Independent Directors and members of theManagement to review inter alia the performance of Non-Independent Directors and theBoard as a whole as per the criteria formulated by the Nomination and RemunerationCommittee for evaluation of performance of Directors and Board of Directors. They alsoassessed the quality quantity and timeliness of "ow of information between theCompany Management and the Board that is necessary for the Board to effectively andreasonably perform their duties.
In addition to these formal Meetings interaction outside the Board Meetings also takeplace between the Chairman and Independent Directors.
(g) Performance Evaluation of Independent Directors
The performance evaluation of I ndependent Directors was done by the entire Board ofDirectors as required under Regulation 17(10) of the Listing Regulations and as perstipulation in Clause VIII of the Code for Independent Directors in Schedule IV of theCompanies Act 2013 in its Meeting held on May 24 2019 excluding the IndependentDirector being evaluated as per the criteria formulated by the Nomination and RemunerationCommittee (NRC) for evaluation of performance of Independent Directors. On the basis ofthe report of performance evaluation by the Board it shall be determined by NRC whetherto extend or to continue the term of appointment of Independent Directors.
(h) Annual Evaluation of Board its Committees and Individual Directors
Pursuant to the provisions of the Companies Act 2013 and Listing Regulations the Boardhas carried out an annual evaluation of its own performance of each Board Memberindividually as well as the working of its Committees .
The manner in which the evaluation was carried out was as follows:
The Nomination and Remuneration Committee of your Company formulated and laid downcriteria for Performance Evaluation of the Board (including Committees) and every Director(including Independent Directors) pursuant to the provisions of Section 134 Section 149read with Code of Independent Directors (Schedule IV) and Section 178 of the CompaniesAct 2013 and Regulation 19(4) read with Part D of Schedule II of Listing Regulationscovering inter-alia the following parameters namely:
i) Board Evaluation - degree of ful!lment of key responsibilities; Board culture anddynamics.
ii) Board Committee Evaluation - effectiveness of Meetings; Committee dynamics.
iii) Individual Director Evaluation (including IDs) - contribution at Board Meetings/Committee Meetings.
Further the Chairman and Managing/Whole-time Director are evaluated on key aspects oftheir roles which include inter-alia effective leadership to the Board and adequateguidance to the Management team respectively.
Based on these criteria the performance of the Board various Board Committees viz.Audit Committee Stakeholders' Relationship Committee and Nomination and RemunerationCommittee and Individual Directors (including Independent Directors) was evaluated by theBoard and found to be satisfactory.
During the year under review the Independent Directors of your Company reviewed theperformance of Non-Independent Directors and Chairman of the Company taking into accountthe views of Executive Directors and Non-Executive Directors.
Further the Independent Directors hold unanimous opinion that the Chairman and otherNon-Independent Directors including Managing Director and Whole-time Director bring tothe Board abundant knowledge in their respective fields and are experts in theirrespective areas. Besides they are efficient dynamic matured and practical and havesuf!cient knowledge of the Company.
The Board as a whole is an integrated balanced and cohesive platform where diverseviews are expressed and discussed when required with each Director bringing professionaldomain knowledge to the table. All Directors are participative interactive andcommunicative.
The Chairman has abundant knowledge experience skills and understanding of theBoard's functioning possesses a mind for detail is meticulous to the core and conductsthe Meetings with poise and maturity.
The information flow between the Company's Management and the Board is complete timelywith good quality and sufficient quantity.
The following Policies of the Company are attached herewith marked as AnnexureC' and Annexure D' which have also been placed on the Company'scorporate website www.rtspower.com under the head 'Investor Relations':
(i) Policy for selection of Directors and determining Directors' independence; and
(ii) Remuneration Policy for Directors Key Managerial Personnel and other employees.
Change in Key Managerial Personnel
There was no change in Key Managerial Personnel during the year.
Directors' Responsibility Statement
Pursuant to Section 134(3)(c) and 134(5) of the Companies Act 2013 (the Act')and based upon representations from the Management the Board to the best of itsknowledge and belief confirms that:
(a) in the preparation of the Annual Accounts for the year ended March 31 2019 theapplicable Accounting Standards have been followed and there are no material departuresfrom the same;
(b) the Directors have selected such Accounting Policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2019 and of the Profit ofthe Company for the year ended on that date;
(c) the Directors 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) the Directors have prepared the Annual Accounts of the Company on a goingconcern' basis;
(e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively ; and
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
Declaration by Independent Directors and Statement on compliance of Code of Conduct
Your Company confirms that necessary declaration with respect to independence has beenreceived from all the Independent Directors of the Company and that the IndependentDirectors have complied with the Code for Independent Directors prescribed in Schedule IVto the Act.
The Independent Directors also confirm that they are not aware of any circumstance orsituation which exist or may be reasonably anticipated that could impair or impacttheir ability to discharge their duties with an objective independent judgement andwithout any external influence and that they are independent of the management.
Maximum tenure of Independent Directors
The maximum tenure of Independent Directors is in accordance with the Companies Act2013 and Regulation 25(2) of the SEBI Listing Regulations.
Formal letter of appointment to Independent Directors
The Company issues a formal letter of appointment to Independent Directors in themanner as provided in the Companies Act 2013. As per Regulation 46(2) of the SEBI ListingRegulations the terms and conditions of appointment of Independent Directors are placedon the Company's corporate website www.rtspower.com.
A separate Report on Corporate Governance in format as prescribed in Part C of ScheduleV under Regulation 34(3) of the Listing Regulations forms a part of the Annual Report ofyour Company and is being attached hereto marked as Annexure- A'.
All Board Members and Senior Management Personnel have affirmed compliance with theCode of Conduct for the Financial Year 2018-19. A declaration to this effect signed by theManaging Director of the Company is contained in this Annual Report.
The Managing Director and CFO have certified to the Board the financial statements andother matters as required under Regulation 17(8) of the Listing Regulations.
Certificate from the Practicing Company Secretary regarding compliance of conditions ofCorporate Governance is annexed to this Report.
Management Discussion & Analysis
In terms of the provisions of Regulation 34 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a Report on Management Discussion and Analysis is alsoattached herewith marked as Annexure -B'.
Your Company has not accepted any Deposit within the meaning of Sections 73 and 76 ofthe Companies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014. No amounton account of principal or interest on deposits from public was outstanding as on March31 2019.
No loan or deposit has been taken or accepted from any Director of your Company.
Transfer of Unclaimed Dividend to Investor Education and Protection Fund
Pursuant to the provisions of Section 124 of the Companies Act 2013 and InvestorEducation and Protection Fund Authority (Accounting Audit T ransfer and Refund)Rules2016 (IEPF Rules') (including any statutorymodification(s)/re-enactment(s)/amendment(s) thereof for the time being in force) thedividend which remains unclaimed/unpaid for a period of seven (7) years from the date oftransfer to the unpaid dividend account of the Company is required to be transferred tothe Investor Education and Protection Fund Authority (IEPF') established by theCentral Government.
Pursuant to the provisions of Investor Education and Protection Fund (Uploading ofinformation regarding unpaid and unclaimed amounts lying with companies) Rules 2012 theCompany has uploaded the details of unpaid and unclaimed amounts lying with the Company ason September 28 2018 (date of its last Annual General Meeting) on the Company's Websitewww.rtspower.com and has also filed Form No IEPF 2 on December 112018 with the Registrarof Companies West Bengal.
Since the last Annual General Meeting the Company has also transferred unpaid andunclaimed Dividend amounting to Rs 14512/- in respect of Final Dividend for the FinancialYear 2010-2011 to IEPF and filed Form No IEPF 1 on November 302018 with the Registrar ofCompanies West Bengal following such transfers under Sub section (2) of Section 125 ofthe Act and the IEPF (Accounting Audit Transfer and Refund)Rules 2016.
Shri Sandip Gupta Company Secretary of the Company acts as Nodal Officer of theCompany. The details of the Nodal Officer is available in the Company's corporate Websitewww.rtspower.com.
Transfer of Equity Shares in respect of unclaimed dividend to Investor Education andProtection Fund (IEPF) Demat Account
The IEPF Rules also mandates companies to transfer the Shares in respect of whichdividend has not been paid/claimed by the Shareholders for seven (7) consecutive years ormore to be Demat Account created by the IEPF Authority.
Further in compliance with the provisions laid down in IEPF Rules the Company hadsent notices subsequent reminders and also advertised in the newspapers seeking actionfrom Shareholders who have not claimed their dividends for seven (7) consecutive years ormore. Accordingly for the Financial Year ended March 312011 the Company has transferred2697 Equity Shares on which Dividend remained unclaimed for a period of seven (7) yearsto the Demat Account of the IEPF on December 212018 .
It may please be noted that no claim shall lie against the Company in respect ofShare(s) transferred to IEPF pursuant to the said Rules.The voting rights in respect ofthe above Equity Shares are frozen until the rightful owner claims the Equity Shares. Allcorporate benefits on such Shares in the nature of Bonus Shares Split Shares Rights etc.shall be credited to Unclaimed Suspense Account' as applicable for a period of 7years and thereafter be transferred in line with the provisions of the Investor Educationand Protection Fund Authority (Accounting Audit T ransfer and Refund) Rules 2016 readwith Section 124(5) and Section 124(6) of the Companies Act 2013.
However the Shareholders are entitled to claim their Shares including all thecorporate benefits accruing on such Shares if any from the IEPF Authority by submittingan online application in Form IEPF-5 and sending a physical copy of the Form IEPF-5 dulysigned by all the joint shareholders if any as per the specimen signature recorded withthe Company along with requisite documents enumerated in the Form IEPF-5 to the Company'sRTA. The Rules and Form IEPF-5 as prescribed for claiming back the Shares are availableon the website of the IEPF i.e. on www.iepf.gov.in.
The Statement containing details of Name Address Folio No. Demat Account No. and No.of shares transferred to IEPF Demat Account is made available on Company's CorporateWebsite www.rtspower. com.The Shareholders are therefore encouraged to verify theirrecords and claim their dividends and Shares if not claimed.
Extract of Annual Return
Pursuant to Section 92 and 134(3) of the Companies Act 2013 and Rule 12(1) of theCompanies (Management & Administration) Rules 2014 the extract of the Annual Returnin Form MGT 9 is enclosed marked as Annexure E'.
Statutory Auditors and Auditors' Report Statutory Auditors
Members at the Sixty Ninth Annual General Meeting of the Company (AGM) held onSeptember 112017 had approved the appointment of M/s Lodha & Co. CharteredAccountants (FRN 301051E) as statutory Auditors of the Company for a period of five yearscommencing from the conclusion of Sixty Ninth Annual General Meeting (AGM) held onSeptember 112017 till the conclusion of 74th AGM of the Company to be held in the year2022.
In terms of the provisions relating to Statutory Auditors forming part of the CompaniesAmendment Act 2017 notified on May 7 2018 ratification of appointment of StatutoryAuditors at every AGM is no more a legal requirement. Accordingly the Notice conveningthe ensuing AGM does not carry any Resolution on ratification of appointment of StatutoryAuditors.
However M/s Lodha & Co. Chartered Accountants has confirmed that they areeligible to continue as Statutory Auditors of the Company to audit the books of accountsof the Company for the Financial Year ending March 312020 and accordingly M/s Lodha &Co. Chartered Accountants will continue to be the Statutory Auditors of the Company forthe Financial Year ending March 312020.
Report of Statutory Auditors
The Notes on Financial Statements of the Company referred to in the Auditors' Reportare self-explanatory and do not call for any further comments by the Board. The Auditors'Report does not contain any qualification reservationadverse remark or disclaimer.
Pursuant to the provisions of Section 143(12) of the Companies Act 2013 the Auditorshave not reported any incident of fraud to the Audit Committee during the year underreview.
Internal Auditors and their Report Internal Auditors
Pursuant to the provisions of Section 138 of the Act and the Companies (Accounts)Rules 2014 the Board has re-appointed on the recommendation of the Audit Committee M/sK.S. Bothra & Co Chartered Accountants (FRN 304084E) as Internal Auditors of yourCompany to conduct Internal Audit of the functions and activities of your Company for theFinancial Year 2019-2020.
Report of Internal Auditors
During the Financial Year 2018-2019 no material or serious observation has beenreceived from the Internal Auditors of the Company for inadequacy or ineffectiveness ofsuch internal controls.
Cost Auditors and their Reports Cost Auditors
The Company is required to maintain cost records as specified by the Central Governmentunder subsection (1) of Section 148 of the Act and the rules framed thereunder andaccordingly the Company has made and maintained such cost accounts and records.
The Company has received written consent of the Cost Auditors that the appointment willbe in accordance with the applicable provisions of the Act and rules framed thereunder.
In terms of Section 148 of the Companies Act2013 read with the Companies (Audit andAuditors) Rules 2014 and the Companies (Cost Records and Audit) Amendment Rules 2014 theBoard of Directors of your Company on the recommendation of the Audit Committee hasappointed M/s K.G.Goyal & Associates (FRN 000024) as Cost Auditors of your Companywith due information to the Central Government by way of fling the prescribed Form No CRA2 on May 282019 for conducting audit of cost records of your Company for the FinancialYear 2019-2020 subject to ratification of their remuneration as approved by the Board onthe recommendation of the Audit Committee by the Members of the Company in its ensuingAnnual General Meeting.
Members are requested to consider the ratification of the remuneration payable to M/sK.G.Goyal & Associates (FRN 000024) as set out in the Notice of the 71st AGM of theCompany.
Report of Cost Auditors
For the Financial Year ending March 31 2018 the due date of filing the Cost AuditReport submitted by M/s K.G.Goyal & Associates Cost Auditors was October 30 2018 andthe same was fled with MCA on October 25 2018 in XBRL mode.
Secretarial Auditor and their Report Secretarial Auditors
In terms of Section 204 of the Act and the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 the Board has appointed Shri Manoj Prasad ShawProprietor of M/s Manoj Shaw & Co. Practicing Company Secretary (FCS No 5517 C.P. No4194) to conduct Secretarial Audit for the Financial Year 2018-2019.
Report of Secretarial Auditor
The Secretarial Audit Report for the Financial Year ended March 31 2019 in theprescribed Form No MR3 is annexed herewith pursuant to Section 204(1) of the CompaniesAct 2013 and Rule 9 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 marked as Annexure F' to this Report.
Reporting of Frauds by Auditors
During the year under review the Statutory Auditors Cost Auditors and SecretarialAuditors have not reported any instances of frauds committed in the Company by itsofficers or employees to the Audit Committee under Section 143(12) of the Companies Act2013 details of which needs to be mentioned in this Report.
Particulars of Loans given investments made guarantees given and securities provided
The Company has neither given any Loan and Guarantee nor provided any security in termsof Section 186 of the Companies Act 2013.
The details of investments made by your Company during the Financial Year 2018-2019 areprovided in Note No 13 to Financial Statements of this Annual Report.
Key Financial Ratios
In accordance with SEBI (Listing Obligations & Disclosure Requirements) (Amendment)Regulations 2018 the Company is required to give details of significant changes (i.e.change of 25% or more as compared to the immediately previous Financial Year) in keysector-specific financial ratios including Debtors Turnover Inventory Turnover InterestCoverage Ratio Current Ratio Debt Equity Ratio Operating Profit Margin (%) and NetProfit Margin (%) and details of any change in Return on Net Worth as compared to theimmediately previous Financial Year.
|Ratio ||Financial Year 2018-2019 ||Financial Year 2017-2018 |
|Current Ratio ||1.65 ||1.41 |
|Interest Coverage Ratio ||1.56 ||1.67 |
|Inventory Turnover Ratio ||6.81 ||2.63 |
|Net Profit Margin ||2.22 ||2.20 |
|Operating Profit Margin ||8.82 ||6.72 |
|Return on Net Worth ||11.45 ||11.66 |
|Debtors Turnover Ratio ||2.75 ||2.52 |
|Debt Equity Ratio ||1.67 ||2.82 |
The Inventory Turnover ratio has improved significantly by better control andmanagement of inventories.
The increase in Operating Profit Margin is on account of an improved performancein 2018-2019.
Debt Equity Ratio has improved due to reduction in borrowings of the Company.
Policy on Preservation of Documents
In accordance with Regulation 9 of SEBI Regulations 2015 the Company has framed aPolicy on Preservation of Documents approved by the Board of Directors of the Company.The Policy is intended to define preservation of documents and to provide guidance to theexecutives and employees working in the Company to make decisions that may have an impacton the operations of the Company. It not only covers the various aspects on preservationof the documents but also the safe disposal/destruction of the documents. The Policy hasbeen uploaded on the Company's corporate website www.rtspower. com under the head'Investor Relations'.
Policy on Determination of Materiality for Disclosures and Archival Policy
In accordance with Regulation 30 of SEBI Regulations 2015 the Company has framed aPolicy on determination of materiality for disclosures to disclose events or informationwhich in the opinion of the Board of Directors of the Company are material.
Further the Company has an Archival Policy in line with the requirements of SEBIRegulations to ensure that information relating to the Company is adequately disclosed onits corporate website www.rtspower. com under the head 'Investor Relations' as requiredby law.
Policy and Particulars of Related Party Transactions
All transactions entered into with the related parties during the Financial Year endedMarch 31 2019 were in the ordinary course of business and on an arm's length basis andwithout any conflict of interest in accordance with the provisions of the Companies Act2013 and SEBI Regulations 2015.
Moreover there were no materially significant related party transactions during theFinancial Year which were in conflict with the interest of the Company. During the yearthe Company has not entered into any contract/arrangement/transaction with any relatedparties which could be considered material in accordance with the Policy of the Company onmateriality of the related party transactions. There being no material' relatedparty transactions as defined under Regulation 23 of Listing Regulations no details needto be disclosed in Form AOC-2 in that regard.
All such contracts/arrangements/transactions with any related parties were placedbefore the Audit Committee and Board for their approval. Prior omnibus approval of theAudit Committee/ Board is obtained on an annual basis which is reviewed and updated onquarterly basis.
A Statement in summary form of transactions with related parties in the ordinary courseof business has been periodically placed before the Audit Committee and the Board ofDirectors for its approval before entering into such transactions or making any amendmentthereto during the year under review.
For the current Financial Year 2019-2020 the Audit Committee has given omnibusapproval of related party transactions to be entered into by the Company on the basis ofcriteria laid down by it and approved by the Board of Directors.
The Audit Committee reviews on a quarterly basis the details of related partytransactions entered into by the Company pursuant to each of the omnibus approval given byit. All such related party transactions for which omnibus approval has been given by theAudit Committee has also been subsequently approved by the Board for the current FinancialYear 2019-2020.
In line with the amendments in SEBI (LODR) (Amendment) Regulations 2018 during theyear the Policy was reviewed by the Board of Directors. The Policy for related partytransactions has been uploaded on the Company's corporate website www.rtspower.com underthe head 'Investor Relations'. The Policies on materiality of related party transactionsand dealing with related party transactions as approved by the Board may be accessed onthe Company's corporate website at the link www.rtspower.com.
Your Directors draw attention of the Members to Note No 46 to the Financial Statementswhich sets out details of related party disclosures.
Subsidiary Joint Venture and Associate Company
Your Company does not have any Subsidiary Joint Venture and Associate Company duringthe year under review. Accordingly a statement under the provisions of Section 129(3) ofthe Companies Act 2013 containing salient features of the financial statements of theCompany's subsidiary(ies) in Form AOC-1 is not enclosed.
Particulars of Employees and Remuneration
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1 )of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 as amended by the Companies (Appointment andRemuneration of Managerial Personnel) Amendment Rules 2016 (the Rules) are provided in AnnexureG'.
Further the information as required pursuant to Rule 5(2) and 5(3) of the said Rulesalso forms a part of this Annual Report. However as per the proviso to Section 136(1) ofthe Act this Annual Report is being sent to all the Members of the Company excluding theabove said information. The said information is available for inspection by Members at theCompany's Registered Office during working hours upto the date of the Annual GeneralMeeting. Any Member interested in obtaining such information may also write to the CompanySecretary at the Registered Office of the Company.
The Audit Committee of the Board of Directors constituted in terms of Regulations ofthe Listing Regulations and Section 177 of the Companies Act 2013 read with Rule 6 of theCompanies (Meetings of Board and its Powers) Rules 2014 has been functioning in yourCompany for a long time.
As on the close of business on March 31 2019 the Audit Committee comprised of twoNon-Executive Independent Directors Shri Sardul Singh Jain and Shri Alok Kumar Banthiaand one Executive NonIndependent Director Shri Rajendra Bhutoria Vice Chairman &Whole-time Director of your Company. Shri Sardul Singh Jain is the Chairman of theCommittee who also chaired the Annual General Meeting of your Company held on September28 2018. All the Members of the Committee are financially literate and have accounting orrelated financial management expertise.
The Company's Accounts personnel and representatives of the statutory Auditors as wellas Internal Auditors and Cost Auditors are invitees in most of the Meetings of the AuditCommittee.
Shri Sandip Gupta Company Secretary acts as the Secretary of the Committee.
All recommendations of the Audit Committee were duly accepted by the Board and therewere no instances of any disagreements between the Committee and the Board.
A Vigil Mechanism which also incorporates a Whistle Blower Policy in terms of theListing Regulations has been established for Directors Employees and Stakeholders toreport their genuine concerns about unethical behaviour actual or suspected fraud orviolation of the Company's code of conduct or ethics policy or grievances in accordancewith the provisions contained in Section 177 of the Companies Act 2013 read with Rule 7of The Companies (Meetings of Board and its Powers) Rules 2014 and Regulation 22 of theListing Regulations. Such Vigil Mechanism provides for adequate safeguards againstvictimization of Directors Employees and Stakeholders who avail of the Vigil Mechanismand also provides for direct access to the Chairman of the Audit Committee in appropriateor exceptional cases.
The Audit Committee as formed above oversees the Vigil Mechanism and should any ofthe Members of the Committee have a conflict of interest in a given case they shouldrecuse themselves and the others on the Audit Committee would deal with the matter onhand.
Details in this regard have been disclosed in the Company's corporate websitewww.rtspower.com under the head 'Investor Relations'.
Corporate Social Responsibility Policy
The Company has in place a Corporate Social Responsibility Policy in line with ScheduleVII of the Companies Act 2013 as prescribed in the Companies (Corporate SocialResponsibility Policy) Rules 2014. The annual Report on CSR Activities is furnished in"Annexure H " forming part of this Directors' Report.
The CSR Policy has been hosted in the Company's website at the link www.rtspower.comunder the head 'Investor Relations'.
Risk Management Policy
Keeping in view of the nature of industry in which your Company is engaged yourCompany has all along been conscious of the risk associated with the nature of itsbusiness. Senior Management personnel carry out risk identification risk assessment risktreatment and risk minimization procedures for all functions of the Company which areperiodically reviewed on an ongoing basis and Board Members are informed about all thesefrom time to time to ensure that executive management controls risk through means of aproperly defined framework. The Board of Directors is overall responsible for framingimplementing and monitoring the Company's systems for risk management.
The Board of Directors also oversees that all the risks that the organization facessuch as strategic financial credit marketing liquidity security property goodwillIT legal regulatory reputational and other risks have been identified and assessed andexecutive management keeps a vigil on such risks so that it can be addressed properly assoon as possibility of occurrence of any one of such risks arises.
Compliance with Secretarial Standards on Board and General Meetings
The Company has in place proper systems and processes to ensure compliance with theprovisions of the applicable Secretarial Standards issued by the Institute of CompanySecretaries of India and such systems are adequate and operating effectively.
Adequacy of Internal Financial Controls with reference to the Financial Statements
Your Company has in all material respects an adequate internal financial controlsystem over financial reporting and such internal financial controls over financialreporting were operating effectively as at March 31 2019 based on the internal controlover financial reporting criteria established by the Company considering the essentialcomponents of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants ofIndia.
Your Company's internal control structure showed no reportable material weakness.
Significant and material orders passed by Regulators or Courts or Tribunal
No significant and/or material orders have been passed by Regulator(s) or Court(s) orTribunal(s) impacting the going concern status of the Company and its business operationsin future.
Prevention of Sexual Harassment at Workplace
Your Company has zero tolerance policy in case of sexual harassment at workplace and iscommitted to provide a healthy environment to each and every employee of the Company. TheCompany has in place Policy for Prevention and Redressal of Sexual Harassment' inline with the requirements of Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (hereinafter referred as "the said Act")and Rules made there under.
Your Directors state that during the year under review there was no case filedpursuant to The Sexual Harassment of Women at the Workplace (Prevention Prohibition andRedressal) Act 2013.
In commitment to keep in line with the Green Initiative and going beyond it to createnew green initiatives electronic copy of the Notice of 71st Annual General Meeting of theCompany are sent to all Members whose e-mail addresses are registered with the Company/Depository Participant(s). For Members who have not registered their e-mail addressesphysical copies are sent through the permitted mode.
Your Directors acknowledge their deep sense of appreciation to all the Employees atall levels in your Company for their sustained efforts and immense contributions to thelevels of performance and growth that your Company has achieved during the year underreview.
They would also like to place on record their whole-hearted appreciation for thecontinued and unstinted co-operation and support received by the Company during the yearunder review from Bankers State Electricity Boards Government and Semi GovernmentAuthorities Power Utilities other customers vendors and Shareholders.
|Registered Of!ce: ||For and on behalf of the Board of Directors |
|56 Netaji Subhas Road ||SARDUL SINGH JAIN |
|Kolkata - 700001. ||CHAIRMAN |
|Dated: May 30 2019 ||DIN 00013732 |