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RTS Power Corporation Ltd.

BSE: 531215 Sector: Engineering
NSE: N.A. ISIN Code: INE005C01017
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NSE 05:30 | 01 Jan RTS Power Corporation Ltd
OPEN 78.55
PREVIOUS CLOSE 77.10
VOLUME 4592
52-Week high 88.00
52-Week low 44.25
P/E 12.83
Mkt Cap.(Rs cr) 71
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 78.55
CLOSE 77.10
VOLUME 4592
52-Week high 88.00
52-Week low 44.25
P/E 12.83
Mkt Cap.(Rs cr) 71
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

RTS Power Corporation Ltd. (RTSPOWERCORPN) - Director Report

Company director report

Dear Shareholders

Your Director have pleasure in presenting the 73rd Annual Report on the business andoperations of your Company together with the audited Financial Statements for the yearended March 31 2021:

Financial Results and State of Affairs (Rs. in Lakhs)

Financial Year ended March 31 2021 Financial Year ended March 31 2020 Financial Year ended March 31 2021 Financial Year ended March 31 2020
(Standalone) (Standalone) (Consolidated) (Consolidated)
Revenue from Operations 6069.79 11227.07 7752.87 11162.40
Other Income 708.26 2020.21 635.40 200.59
Profit Before Depreciation Finance Costs Exceptional items and Tax Expenses 973.26 861.98 896.89 790.60
Less : Depreciation/Amortization/ Impairment 227.56 250.00 306.77 250.00
Profit Before Finance Costs Exceptional items and Tax Expenses 745.70 611.98 590.12 611.98
Less: Finance Costs 211.33 284.78 233.70 284.78
Profit before Exceptional Items and Tax Expenses 534.37 327.20 356.42 255.82
Add/Less Exceptional Items 0 0 0 0
Profit Before Tax Expense 534.37 327.20 356.42 255.82
Less: Tax Expenses
Current Tax 75.91 188.28 75.91 188.28
Add: Deferred Tax Charge/Credit 47.13 (1047.17) 47.13 (1047.17)
Profit for the year 411.33 1186.09 233.38 1114.71
Other Comprehensive Income (Net of Tax) (13.45) 34.10 (13.45) 34.10
Total 397.88 1220.19 219.33 1148.81

Company’s Performance

Your Company presents its seventy third operational performance for the Financial Year2020-2021.

Net Revenue from Operations for the year was ` 60 crores as compared to ` 112 crores inthe previous year resulting in a decrease of 46.42%. However Profit Before Tax hasincreased by 63.31 % to ` 5.34 crores as against ` 3.27 crores in the previous year. Giventhe fall in demand for Transformers and Cables your Company has expanded its portfolio ofproducts and services by setting up a wholly - owned Subsidiary Reengus Wires PrivateLimited was formed in year 2019 for manufacture of galvanized wires and strips. This planthas now commenced commercial production and is trying to establish itself in the market.The response so far has been encouraging. Due to the onset of Covid-19 Indian Utilitieshave been facing various headwinds. Their financial position is today very precarious.Most Utilities have postponed their purchase of Capital Equipment severally affecting theIndian Electrical Equipment Industry. At this stage the outlook of our industry remainsextremely subdued and challenging. Your company has adopted a very cautious approachtowards only selected order booking from Utilities. Given low external borrowings and verylow Total Outside Liability your company is in a better position than many of itscompetitors to weather the present storm. Your Company remains very careful in selectingits customers and is targeting only profitable segments with payment certainty. Demand foryour Company’s products remain very poor at present.

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.

Dividend

The Board of Directors has proposed to retain the entire amount of Profit of ` 3.97Crores for expansion and further growth of your Company and therefore has notrecommended payment of any Dividend.

COVID 19

After around a year into the COVID-19 pandemic it is still a prime concern for theglobal economies with its new mutations. Sharp resurgence in number of confirmed casesfollowed by re-introduction of lockdown measures in affected regions of world causeddisruption in business activities.

The COVID-19 pandemic is a worldwide crisis and has meant that the economies will haveto operate alongside the disease.

The Company strictly followed the guidelines issued by the local state and centralgovernments and also went beyond to protect the health and well-being of its workforce andensured minimum disruption to its customers. Despite this the sales of the Company wereaffected due to the pandemic.

Future Outlook

Power distribution is one of the areas in which India is looking to multiply itscapability rapidly. Driven by the exhortation from the government and correspondinginitiatives the sector is witnessing a host of manufacturers looking to meet the demandfor transformers and other equipment. As a result the power and distribution transformermarket in India is expected to witness continuous growth in the near future owing togovernment initiatives to boost the electrification rate and uplift the operationalefficiency of (DISCOMS) in the nation.

There has been a surge in demand for power in India which has been fostered by anincrease in capacity utilization industrialization urbanization and population.Currently India has the fifth largest installed capacity in the power sector worldwide.Further reforms such as Power for all and plans to add 175 GW of capacity by 2022 wouldsurge the demand for power transmission and distribution equipment. Transformermanufacturers are gearing up for this challenge of fulfilling the demand.

With a near total village and household electrification having been achieved it shallendeavor to provide stable and continuous power to all Indians.

This should translate into huge investments in strengthening the Grid particularly thedistribution network which shall 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 PowerSector remains high demand for your Company’s products will continue to rise.

Share Capital

The Company has a Paid up Share Capital of ` 9.17 Crores as on March 31 2021.

There has been no change in the Authorized Share Capital of your Company which remainsat _ 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 ownEquity Shares.

Credit Rating

Brickwork Ratings India Private Limited maintained its credit ratings

During the year your Company has received its Credit ratings from Brickwork RatingsIndia Private Limited. The Company maintained its credit ratings at BBB- and its shortterm Bank facilities Credit rating at A3. The letter containing the credit ratings isavailable in the Company’s Corporate Website www.rtspower.com and can be accessedunder the head "Investor Relations".

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 Director have nothing to report in the matter of Technology Absorption since yourCompany has neither hired nor imported any technology from outside sources. Your Companyhas no Research and Development (R&D) Department and has not spent any amount onR& D during the Financial Year.

Your Company had an Export turnover of _ 388.37 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 ForeignCurrency

Foreign Travelling _ 4.25 Lakhs

Indian Accounting Standards

Your Company has adopted Indian Accounting Standards (‘IND- AS’) with effectfrom April 1 2017. Financial Statements for the year ended March 31 2021 have beenprepared in accordance with IND-AS notified under the Companies (Indian AccountingStandards) Rules 2015 (as amended) read with Section 133 and other applicable provisionsof the Companies Act 2013.

Director

The Board of Director (the Board) of your Company consists of a balanced profile ofMember 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 Director

Mr. Siddharth Bhutoria Appointed as a whole time director of the company with effectfrom July 15 2020 Mr. Ram Lal Saini resigned as Non-Executive Director of the Companywith effect from December 05 2020.

(b) Independent Director

Your Company has at present two Independent Director namely Mr. Sardul Singh Jain(DIN 00013732) and Mr. 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) Regulations 2015 (hereinafter referredto as "Listing Regulations"). They are not liable to retire by rotation. YourCompany has received necessary declarations from the above mentioned Independent Directorunder Section 149(7) of the Act confirming that they meet the criteria of independence asprescribed both under Sub-Section(6) of Section 149 of the Act and under Regulation 16(b)of the Listing Regulations.

(c) Retirement of Director by rotation

As per the provisions of the Companies Act 2013 and the Articles of Association of theCompany Mr. Rajendra Bhutoria (DIN: 00013637) Director of your Company will retire byrotation at the forthcoming Annual General Meeting and being eligible offer himself forre-appointment.

A Resolution seeking Member’ approval for his re-appointment forms a part of theNotice convening the Seventy Third Annual General Meeting.

(d) Meetings of the Board and its Committees

The number and dates of Meetings of the Board and its Committees thereof and theDirector present therein have been given in the Report on Corporate Governance attachedherewith.

(e) Separate Meetings of Independent Director

As per stipulation in Clause VII of the Code for Independent Director in ScheduleIV of the Companies Act 2013 and as per Regulation 25(3) of the Listing Regulationsseparate Meetings of the Company’s Independent Director was held on 30th December2020 without the attendance of Non-Independent Director and member of the Management toreview inter alia the performance of Non-Independent Director and the Board as whole asper the criteria formulated by the Nomination and Remuneration Committee for evaluation ofperformance of Director and Board of Director. They also assessed the quality quantityand timeliness of flow of information between the Company Management and the Board that isnecessary for the Board to effectively and reasonably perform their duties.

In addition to these formal Meetings interaction outside the Board Meetings also takeplace between the Chairman and Independent Director.

(g) Performance Evaluation of Independent Director

The performance evaluation of Independent Director was done by the entire Board ofDirector as required under Regulation 17(10) of the Listing Regulations and as perstipulation in Clause VIII of the Code for Independent Director in Schedule IV of theCompanies Act 2013 in its Meeting held on June 04 2020 excluding the IndependentDirector being evaluated as per the criteria formulated by the Nomination and RemunerationCommittee (NRC) for evaluation of performance of Independent Director. On the basis of thereport of performance evaluation by the Board it shall be determined by NRC whether toextend or to continue the term of appointment of Independent Director.

(h) Annual Evaluation of Board its Committees and Individual Director

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligationand Disclosure Requirements) Regulations 2015 the Board has carried out an annualevaluation of its own performance of each Board Member individually as well as theworking 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 Director) pursuant to the provisions of Section 134 Section 149read with Code of Independent Director (Schedule IV) and Section 178 of the Companies Act2013 and Regulation 19(4) read with Part D of Schedule II of Listing Regulations coveringinter-alia the following parameters namely:

i) Board Evaluation - degree of fulfillment 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 evaluatedon key aspects of their roles which include inter-alia effective leadership to the Boardand adequate guidance to the Management team respectively. Based on these criteria theperformance of the Board various Board Committees viz. Audit CommitteeStakeholders’ Relationship Committee and Nomination and Remuneration CommitteeCorporate Social Responsibility Committee and Individual Directors (including IndependentDirector) was evaluated by the Board and found to be satisfactory.

During the year under review the Independent Directors of your Company reviewed theperformance of Non- Independent Director and Chairman of the Company taking into accountthe views of Executive Director and Non-Executive Director.

Further the Independent Directors hold unanimous opinion that the Chairman and otherNon-Independent Director 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 havesufficient 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 andconducts the Meetings with poise and maturity. The information flow between theCompany’s Management and the Board is complete timely with good quality andsufficient quantity.

The following Policies of the Company are attached herewith marked as Annexure‘C’ and Annexure ‘D’ which have also been placed on theCompany’s corporate website www.rtspower.com under the head "InvestorRelations":

(i) Policy for selection of Director and determining Director ‘ independence; and

(ii) Remuneration Policy for Director Key Managerial Personnel and other employees.

Change in Key Managerial Personnel

Mr. Siddharth Bhutoria appointed as a whole time director of the company with effectfrom July 15 2020 Mr. Sharad Bhutoria resigned as Chief Executive officer of the companywith effect from July 13 2020 Mr. Ram Lal Saini resigned as Non-Executive Director of theCompany with effect from December 05 2020.

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 thebest of its knowledge and belief confirms that:

a. in the preparation of the Annual Accounts for the year ended March 31 2021 theapplicable Accounting Standards have been followed and there are no material departuresfrom the same;

b. the Director 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 affair of the Company as at March 31 2021 and of the Profit ofthe Company for the year ended on that date;

c. the Director 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 Director have prepared the Annual Accounts of the Company on a ‘goingconcern’ basis ;

e. the Director 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 Director have devised proper systems to ensure compliance with the provisions ofall 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 Director prescribed in Schedule IVto the Act. The Independent Director also confirm that they are not aware of anycircumstance or situation which exist or may be reasonably anticipated that couldimpair or impact their ability to discharge their duties with an objective independentjudgement and without any external influence and that they are independent of themanagement.

Maximum tenure of Independent Director

The maximum tenure of Independent Director is in accordance with the Companies Act2013 and Regulation 25(2) of the SEBI Listing Regulations.

Formal letter of appointment to Independent Director

The Company had issued a formal letter of appointment to Independent Director 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 and can be accessed under thehead "Investor Relations."

Corporate Governance

The Company is committed to maintain the highest standards of corporate governance andadhere to the related requirements set out in the Listing Regulations. A separate Reporton Corporate Governance in format as prescribed in Part C of Schedule V under Regulation34(3) of the Listing Regulations with Additional Shareholder Information (AnnexureB’) along with the Auditors’ Certificate thereon form a part of the AnnualReport of your Company and is being attached hereto marked as Annexure- ‘A’.

All Board Member and Senior Management Personnel have affirmed compliance with the Codeof Conduct for the Financial Year 2020-21. 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’.

Deposits

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 2021.

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 Transfer and Refund) Rules2016 (‘IEPF Rules’) (including any statutory modification(s)/ re-enactment(s) /amendment(s) thereof for the time being in force) the dividend which remains unclaimed/unpaid for a period of seven (7) years from the date of transfer to the unpaid dividendaccount of the Company is required to be transferred to the Investor Education andProtection Fund Authority (‘IEPF’) established by the Central 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 no unpaid and unclaimed amounts lying with the Company as on December 30 2021(date of its last Annual General Meeting) as all unpaid and unclaimed amounts had alreadybeen transferred under Sub section (2) of Section 125 of the Act and the IEPF (AccountingAudit Transfer and Refund) Rules 2016.

Since the last Annual General Meeting the Company does not have any unpaid andunclaimed Dividend to be transferred under Sub section (2) of Section 125 of the Act andthe IEPF (Accounting Audit Transfer and Refund) Rules 2016. Mr. Sandip Gupta CompanySecretary of the Company acts as Nodal Officer of the Company. The details of the NodalOfficer is available in the Company’s Corporate Website www.rtspower.com and can beaccessed under the head "Investor Relations." Transfer of Equity Shares inrespect of Unclaimed Dividend to Investor Education and Protection Fund (IEPF) DEMATAccount 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 year ormore to the DEMAT Account created by the IEPF Authority. Further in compliance with theprovisions laid down in IEPF Rules the Company had sent notices subsequent reminder andalso advertised in the newspaper seeking action from Shareholders who have not claimedtheir dividends for seven (7) consecutive years or more.

Accordingly till the Financial Year ended March 31 2011 the year in which theCompany had last declared dividend the Company had transferred Equity Shares on whichDividend remained unclaimed for a period of seven (7) years to the DEMAT Account of theIEPF.

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 Rightsetc. shall be credited to ‘Unclaimed Suspense Account’ as applicable for aperiod of 7 years and thereafter be transferred in line with the provisions of theInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016 read with 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 theCompany’s RTA. The Rules and Form IEPF-5 as prescribed for claiming back the Sharesare available on 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 websitewww.rtspower.com.The Shareholders are therefore encouraged to verify their records andclaim 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 11 2017 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 11 2017 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 31 2022 and accordingly M/s Lodha& Co. Chartered Accountants will continue to be the Statutory Auditors of theCompany for the Financial Year ending March 31 2022.

Report of Statutory Auditors

The Notes on Financial Statements of the Company referred to in the Auditors’Report (both Standalone and Consolidated) are self-explanatory and do not call for anyfurther comments by the Board. The Auditors’ Report (both Standalone andConsolidated) do not contain any qualification reservation adverse 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 reappointed 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 2021-2022.

Report of Internal Auditors

During the Financial Year 2020-2021 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 sub-section (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 the rules framedthereunder.

In terms of Section 148 of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 and the Companies (Cost Records and Audit) Amendment Rules 2014 theBoard of Director 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 filing the prescribed Form No CRA2 on April 30 2021 for conducting audit of cost records of your Company for theFinancial Year 2021-2022 subject to ratification of their remuneration as approved by theBoard on the recommendation of the Audit Committee by the Members of the Company in itsensuing Annual 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 73rd AGM of theCompany.

Report of Cost Auditors

For the Financial Year ending March 31 2020 the due date of filing the Cost AuditReport submitted by M/s K.G. Goyal & Associates Cost Auditors was December 30 2020which was extended by Ministry of Corporate Affairs vide its Circular dated December 012020 to December 31 2020 and the same was filed with MCA on December 11 2020 in XBRLmode.

Secretarial Auditors 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 Mr. 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 2021-2022.

Report of Secretarial Auditors

The Secretarial Audit Report for the Financial Year ended March 31 2021 in theprescribed Form No MR-3 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 2020-2021 areprovided in 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 2020-2021 Financial Year 2019-2020
Current Ratio 2.88 2.73
Interest Coverage Ratio 3.52 2.15
Inventory Turnover Ratio 2.98 3.84
Net Profit Margin 6.78 10.56
Operating Profit Margin 12.29 5.45
Return on Net Worth 3.18 9.46
Debtors Turnover Ratio 1.02 1.97
Debt Equity Ratio 0.43 0.40

The Current ratio has improved significantly by better control and management ofcurrent assets.

The interest coverage ratio has also improved on account of lower finance cost.

The Inventory Turnover ratio has decreased due lower turnover.

Net profit margin has decreased due to deferred tax liability.

The increase in Operating Profit Margin is on account of an improved performance in2020-2021.

Return on net worth due to lower profits.

Debtors’ turnover ratio has been reduced due to lower sales.

Debt Equity Ratio has decreased due to increase 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 Director of the Company. ThePolicy 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 has been uploaded on the Company’s corporate website www.rtspower.com andcan be accessed 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 Director 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 and can be accessed under the head "InvestorRelations" as required by law.

Policy and Particulars of Related Party Transactions

All transactions entered into with the related parties during the Financial Year endedMarch 31 2021 were in the ordinary course of business and on an arm’s length basisand without any conflict of interest in accordance with the provisions of the CompaniesAct 2013 and SEBI Regulations 2015. Moreover there were no materially significantrelated party transactions during the Financial Year which were in conflict with theinterest of the Company. During the year the Company has not entered into anycontract/arrangement/transaction with any related parties which could be consideredmaterial in accordance with the Policy of the Company on materiality of the related partytransactions. There being no ‘material’ related party transactions as definedunder Regulation 23 of Listing Regulations no details need to be disclosed in Form AOC-2in 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 2021-2022 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 Director. The Audit Committeereviews on a quarterly basis the details of related party transactions entered into by theCompany pursuant to each of the omnibus approval given by it. All such related partytransactions for which omnibus approval has been given by the Audit Committee has alsobeen subsequently approved by the Board for the current Financial Year 2020-2021.

In line with the amendments in SEBI (LODR) (Amendment) Regulations 2018 during theyear the Policy was reviewed by the Board of Director. The Policy for related partytransactions has been uploaded on the Company’s corporate website www.rtspower.comand can be accessed under the head "Investor Relations". The Policies onmateriality of related party transactions and dealing with related party transactions asapproved by the Board may be accessed on the Company’s corporate website at the linkwww.rtspower.com and can be accessed under the head "Investor Relations".

Your Directors draw attention of the Members to Note No. 47 to the Financial Statementswhich sets out details of related party disclosures.

Subsidiary Joint Venture and Associate Company

The Company has one unlisted wholly owned subsidiary as on date namely Reengus WiresPrivate Limited (CIN: U36997WB2019PTC234547) which was incorporated on October 30 2019.

There are no associate companies or joint venture companies within the meaning ofSection 2(6) of the Act.

The Company has prepared a Consolidated Financial Statement of the Company and itsWholly-owned Subsidiary Reengus Wires Private Limited in the form and manner as that ofits own duly audited by M/s. Lodha & Co. the statutory auditors in compliance withthe applicable accounting standards and the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as amended by the SEBI (Listing Obligations andDisclosure Requirements)

(Amendment) Regulations 2018 (hereinafter referred to as the ‘SEBI ListingRegulations.’)

The Consolidated Financial Statements for the year 2020-21 form a part of the AnnualReport and Accounts and shall be laid before the Members of the Company at the AGM whilelaying its financial statements under sub-section (2) of the said section.

Pursuant to the provisions of Section 129(3) of the Act read with Rule 5 of theCompanies (Accounts) Rules 2014 a statement containing the salient features of thefinancial statements of the Company’s subsidiaries in Form AOC-1 is attached to thefinancial statements of the Company.

Further pursuant to the provisions of Section 136 of the Act the financial statementsof the Company consolidated financial statements along with relevant documents andseparate audited accounts in respect of subsidiary are available on the website of theCompany at www.rtspower.com and can be accessed under the head ‘InvestorRelations’. The Company does not have any material subsidiary in the immediatelypreceding accounting year. However as per Regulation 16 of the SEBI Listing Regulationsas amended the Company has adopted the policy for determining ‘material’subsidiaries which states that a ‘material’ subsidiary means a subsidiarywhose income or net worth exceeds 10% of the consolidated income or net worthrespectively of the Company and its subsidiaries in the immediately preceding accountingyear.

Accordingly a Policy on ‘material subsidiaries’ was formulated by the AuditCommittee of the Board of Directors of the Company and the same is also posted on theCompany’s website and may be accessed at the link:. https://www.rtspower. com

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 inAnnexure ‘G’.

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 up to 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.

Audit Committee

The Audit Committee of the Board of Director constituted in terms of Regulation18 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 2021 the Audit Committee comprised of twoNon-Executive Independent Director Mr. Sardul Singh Jain and Mr. Alok Kumar Banthia andone Executive Non-Independent Director Mr. Rajendra Bhutoria Vice Chairman &Whole-time Director of your Company. Mr. Sardul Singh Jain is the Chairman of theCommittee who also chaired the Annual General Meeting of your Company held on December30 2020. All the Members of the Committee are financially literate and have accounting orrelated financial management expertise. The Company’s Accounts personnel andrepresentatives of the statutory Auditors as well as Internal Auditors and Cost Auditorsare invitees in most of the Meetings of the Audit Committee. Mr. Sandip Gupta CompanySecretary acts as the Secretary of the Committee. All recommendations of the AuditCommittee were duly accepted by the Board and there were no instances of any disagreementsbetween the Committee and the Board.

Vigil Mechanism

A Vigil Mechanism which also incorporates a Whistle Blower Policy in terms of theListing Regulations has been established for Director Employees and Stakeholders toreport their genuine concerns about unethical behavior actual or suspected fraud orviolation of the Company’s code of conduct or ethics policy or grievances inaccordance with the provisions contained in Section 177 of the Companies Act 2013 readwith Rule 7 of The Companies (Meetings of Board and its Powers) Rules 2014 and Regulation22 of the Listing Regulations. Such Vigil Mechanism provides for adequate safeguardsagainst victimization of Director Employees and Stakeholders who avail of the VigilMechanism and also provides for direct access to the Chairman of the Audit Committee inappropriate or 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 and can be accessed under the head "Investor Relations".

Corporate Social Responsibility Policy

In accordance with Section 135 of the Act and the rules made thereunder the Company hasin place a Corporate Social Responsibility Policy in line with Schedule VII of theCompanies Act 2013 as prescribed in the Companies (Corporate Social ResponsibilityPolicy) Rules 2014.The Annual Report on CSR Activities is furnished in "Annexure H"forming part of this Director’s Report.

The CSR Policy has been hosted in the Company’s website at the linkwww.rtspower.com and can be accessed under 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 risks 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 Director is overall responsible for framingimplementing and monitoring the Company’s systems for risk management.

The Board of Director also oversees that all the risks that the organization faces suchas strategic financial credit marketing liquidity security property goodwill ITlegal 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 2021 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’in line 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 Director state that during the year under review therewas no case filed pursuant to The Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013.

Green Initiatives

In commitment to keep in line with the Green Initiative and going beyond it to createnew green initiatives electronic copy of the Notice of 73rd 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–mailaddresses physical copies are sent through the permitted mode.

Acknowledgement

Your Directors wish to place on record their deep sense of appreciation for thecommitted services by all the employees of the Company. They have displayed commendablesincerity in rallying together as a great team while meeting the recent challenges of anunprecedented scale.

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 Office : For and on behalf of the Board of Director
56 Netaji Subhas Road 2nd Floor S. S. JAIN
Kolkata – 700001

Chairman

Dated: June 30 2021 DIN : 00013732

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