We have pleasure in presenting the Thirty Fourth Annual Reporttogether with the audited financial statements of the Company for the Financial Year endedMarch 312019
1. FINANCIAL SUMMARY OF THE COMPANY
| || ||(र Lakhs) |
|Particulars ||For the year ended March 31 2019 ||For the year ended March 31 2018 |
|I Revenue from operations ||55976.62 ||44277.14 |
|II Other Income ||70.70 ||310.24 |
|III Total Revenue (I + II) ||56047.32 ||44587.38 |
|IV Expenses || || |
|a Cost of materials consumed ||41933.48 ||35832.40 |
|b Purchase of stock in trade ||- ||- |
|c Changes in inventories of finished goods work-in-progress and stock-in-trade ||-52.18 ||-3486.66 |
|d Employee benefit expenses ||2489.37 ||1985.69 |
|e Finance Cost ||1988.47 ||1491.25 |
|f Depreciation and amortisation expense ||1215.96 ||1053.61 |
|g Other expenses ||5241.39 ||4617.23 |
|h Total Expenses ||52816.49 ||42549.55 |
|V Profit before exceptional and extraordinary items and tax (lll-IV) ||3230.83 ||3093.86 |
|VI Exceptional Items ||- ||- |
|VII Profit before tax (V-VI) & extraordinary items ||3230.83 ||3093.86 |
|VIII Extraordinary items ||- ||- |
|IX Profit before tax CVII-VIII) ||3230.83 ||3093.86 |
|X Tax expense: ||835.10 ||1092.21 |
|XI Profit for the period - After Tax(IX-X) ||2395.73 ||2001.65 |
|XIII Earnings per equity share: ||- ||- |
|(1) Basic ||15.21 ||13.82 |
|(2) Diluted ||15.10 ||13.45 |
|XIV Reserves and Surplus ||27119.56 ||25507.42 |
2. ANALYSIS OF PERFORMANCE
Your Company has once again demonstrated a good growth in its netrevenues of over 26% year on year during the financial year despite the continuedsluggish in the electrical industry in India. This growth was mainly driven by three keybusiness segments of industrial Switchgear Wires & cables and Building Segments.During the year the building segment has almost doubled on the back of increased productofferings combined with strong focus on retail segment in the Indian markets.
In the concluded financial year 2018-19 Net Revenue of the Companyincreased from र 442.80 Crs to र 559.8 crore with robust growth of 26% in theotherwise subdued market conditions for the electrical and electronics industry. Thisgrowth was driven by all three key businesses of Industrial Switch Gears Building segmentand Wires & cables. Similarly EBITDA (Earnings Before Interest TaxationDepreciation and Amortization) and Profitability of the Company went up by 20%respectively on account of better operational efficiency and availability of the deferredTax Credit. The contribution from domestic sales at 86% was mainly driven by increase indemand and good traction for products in almost all the business divisions.
During the year the legacy products of your Company such as rotaryswitches and toroidal transformers have shown growth and uptick in demand along with otherproducts like three phase dry type transformers and wire harnesses.
Yours Company's focus will always remain on adding new high marginproducts reach out different markets with customized product and solutions in order toadd newer clients and grow our business and constantly looking for new opportunities fortechnical associations to strengthen our base of product offerings.
Your Company's Return on Capital Employed (ROCE) during the yearincreased considerably to 17% in FY2019 from 15% in FY2018 with an increase of more than150 basis points. Your Company would continue to focus on adding new high margin productsunder its product portfolio reach out to new geographies and offer total customersolutions to its customers besides strengthening the revenue drivers improving ROCEworking capital cycle as well as constantly looking for new opportunities for technicalassociations to strengthen the base of product offeringswhich are part of its corestrategy.
Industrial switch gear Division
The industrial switch gear segment is one the largest contributors tooverall revenues of your Company. This segment comprises Cam Operated Rotary Switches;Toraidal Transformers Relays Load Break Switches Wire Harness Three Phase Dry TypeTransformers etc.. This division posted a growth of 13% on year on year and made 41%contribution to the total revenue of the Companymainly driven by products - three phasedry type phase transformers and wire harness.
Wire and cable Division
Wire and cable segment consisting of copper wires and cables is thesecond major business of your Company. On a yearly basis wire and cable businesscontributed 49% with a year on year robust growth of 22%mainly on account of consolidationof Salzer Magnet Wires and increase of new product offerings. From the start of thisfinancial year your Company has started to manufacture and sell wires and cables underthe Salzer brand which is seeing good demand and also seeing a growing opportunity in themarket. This is apart from our regular brand labelling business that we are doing forLarsen &Toubro Crompton and a few other large brands
In order to strengthen the revenues of this Segment your Company hasacquired the whole of the business undertaking from Salzer Magnet Wires Limited onslumpbasis as a going concern in pursuance of the business transfer Agreement effectiveMarch 082018 for a total value of Rs.2029.10 Lakhs for consideration other than cash. Theacquired undertaking has been
facilitating well growth support forthis division.
Building Product Division
This is the only segment where your Company has been operating on a B2Cbasis. The Portfolio under this Segment involves Distribution Boards Modular Switches& Speciality Switches Movement Sensors Remote Switches Single Phase MotorsSwitches House Wires etc..The building segment product division contributed around 7% ofyour Company's revenues in 2018-19 with increased revenues of 98% on YoYon account ofincrease in new product offerings and focus on sales promotional activity to createawareness for products in the retail segment in India. Your Company is confident ofincreasing contribution from this division in the coming two to three years to around 10%of its total revenue levels as it has opened up new opportunities in real estate sectorwhere Unit has got some annual rate contracts with major builders and more focus on retailsegment.
Energy management Division
The fourth is the energy management segment and an order drivenbusiness. This is a new technology oriented business which was developed by your Company'sin-house RS.D team. This product segment has given a benefit of being the largest ESCOwith highest CRISIL rating -Grade A in the country for your Company. Energy managementdivision during the full year FY2019 has contributed 4% to the total net revenues of theCompany
Going forward your Company's focus remains to achieve profitable growthby adding newer products which are customized and value added in nature exploring newergeographies which can yield better margins. With a very competent team in place yourCompany is quite confident of achieving the milestone which it has set for itself.
The Board of Directors at their meeting held on May 24 2019recommended a Dividend at a rate of 16% 1.60 per share) for the financial year ended March31 2019 as that of the last year. The proposal is subject to the approval of shareholdersat the ensuing Annual General Meeting.
Dividend (including dividend tax) as a percentage of net profit aftertax is 13% on the expanded capital. In order to strengthen the internal accruals of theCompany Your Board of Directors moderated the Dividend Payment out of available surplusfor the financial year 2018-19 on the expanded capital.
4. SHARE CAPITAL AND OTHER RELATED SECURITIES
a. Amendment to the Memorandum and Articles of Association
During the year under review your Company has not amended anyProvisions in the Memorandum and Articles of Association.
b. Exercise of Stock Options
During the reporting period your Company issued 456050 equity sharesof र 10/- each to the employees who exercised their vested stock Options under SalzerElectronics Limited Employees Stock Options Scheme 2012-13. Disclosures under Rule 12(9)of Companies (Share Capital and Debentures) Rules 2014 read with Regulation 14 of SEBI(Share Based Employees Benefits) Regulations 2014 are given under Annexure 5.
c. Issue of securities on preferential basis
In our Directors report for the year 2018 it was reported that yourCompany acquired the whole of the business undertaking of Salzer Magnet Wires Limited ("SMW")as a going concern on a Slump basis in terms of Business Transfer Agreement executedon March 082018. In pursuance of the Business Transfer Agreement SMW transferred all itsAssets and Liabilities to the Books of your Company without any further obligations and inturn as a purchase consideration SMW got allotment of 1030000 securities as under at anissue Price of र 197/- per share on March 16 2018 on preferential basis based on thestrength of the shareholders' approval dated December 16 2017 and under Chapter VII ofSEBI (Issue of Capital and Disclosures Requirement) Regulations2009:-
i. 500000 Equity shares of र 10/- each at an issue Price of र197 per share for total value of र 985 Lakhs and
ii. 530000 Non Cumulative 5% Convertible Preference Shares ("NCCPS")Rs.10/- each at an issue Price of ?197 per share for total value of र 1044.10lakhs with lock in period of three years and convertible into equity at any time over theperiod of two years from the date of allotment.
During the reporting period 530 000 Equity shares have been allottedto SMW upon its conversion of NCCPS into equity and thereby the total equity holdings ofSMW increased from 500000 Equity shares to 1030000 Equity shares representing 6.44% ofthe total paid up shares of yourCompany as at March 312019.
Consequent to allotment of shares both under Employees Stock OptionScheme as well as Conversion of NCCPS as aforesaid the Total equity paid up capital ofyour Company increased from र 149966870/ comprising of 14996687 Equity shares ofर 10/- each to Rs.159827370/- comprising of 15982737 Equity shares of र 10/-each.
5. CORPORATE GOVERNANCE
As required under Schedule V(C) of SEBI (Listing Obligations andDisclosure Requirements) Regulations a separate section on corporate governance practicesfollowed by the Company together with a certificate from the Company's Auditorsconfirming compliance attached with this report Annexure: 1
Your Board of Directors as a prudent policy in the absence of specificprovisions in the Companies Act 2013 and Rules made there-under has transferred र4500 Lakhs to the General Reserve Account. Accordingly your Company has general reserveof र 1913.46 Lakhs as at March 312019
As at March 31 2019 your Company had adequate cash and cashequivalents in its Books taking care of all such current liabilities comfortably.
8. CHANGE IN THE NATURE OF BUSINESS IF ANY
During the year the nature of the business of your CompanyManufacturing of Electrical Installation Products- has not been changed.
9. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OFTHE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TOWHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
Your company has been consistently looking for the growth of thebusiness both by Organic and Inorganic means and as parts of its efforts your Companyentered into a definitive agreement with the promoter (CMS Group) of Kaycee to acquire itsstake of 72.32% in Kaycee Industries Limited in an all cash deal and make an additionaloffer to purchase 26% from public for an total Equity Value of INR 22 crores..
Kaycee Industries Limited a "pre-independence" company witha legacy of "three quarter of a century" being pioneer in IndustrialSwitchgear was controlled by home-grown CMS group which is one of the largest IT/ ITES& Enterprise solution firms in India.
Having its corporate office at Mumbai and manufacturing unit atAmbarnath near Mumbai Kaycee's principal products which include Rotary Switches RotaryCam Switches Micro and Toggle Switches Weather Tight Switches Breaker Control SwitchesCounters and Fuse Fittings adds to your Company's attractive product offerings making itcomplementary & synergistic to the existing line of business. This will alsostrengthen Salzer's position in Industrial Switchgear segment which constitutes 41% ofSalzer's current revenue and help Salzer to further expand its footprint into Railwaysaccess to all India dealer network and manufacturing set up in western India.
This Strategic acquisition in line with company's focus to strengthenSalzer's position in the Industrial Switchgear market by increasing its product offeringand expand its footprint in Railway business manufacturing set up in western India andaccess to all India dealer network and to aid your Company to further expand its presenceinto Electrical Equipment sector.
10. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORSOR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS INFUTURE
No orders passed by any Court in India or by any Regulator or byTribunals affecting the going concern status and Company's operations in future.
11. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITHREFERENCE TO THE FINANCIAL STATEMENTS.
The Company has put in place adequate internal financial controls overfinancial reporting. These are reviewed periodically and made part of work instructions orprocesses in the Company. The Company continuously tries to automate these controls toincrease its reliability.
The Company has adopted accounting policies which are in line with theIndian Accounting Standards find As) notified under Section 133 of the Companies Act 2013read together with the Companies (Indian Accounting Standards) Rules 2015. Changes inpolicies if any are approved by the Audit Committee in consultation with the StatutoryAuditors.
The Company has identified inherent reporting risks for each majorelement in the financial statements and put in place controls to mitigate the same. Theserisks and the mitigation controls are reviewed periodically in the light of changes inbusiness IT systems regulations and internal policies. Corporate accounts function isinvolved in designing large process changes as well as validating changes to IT systemsthat have a bearing on the books of account.
The Company periodically conducts physical verification of inventoryfixed assets and cash on hand and matches them with the books of account and dealt withappropriately. No Discrepancies were found during the year under review.
The Company in preparing its financial statements makes judgements andestimates based on sound policies and uses external agencies to verify/ validate them asand when appropriate. The basis of such judgements and estimates are also approved by theAudit Committee of the Board of Directors of the Company in consultation with theStatutory Auditors of the Company.
The Company has a Code of Conduct applicable to all its employees aswell as Board of Directors along with a Whistle Blower Policy which requires employees toupdate accounting information accurately and in a timely manner.
12. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES
Your company does not have any subsidiary company and do not have anyassociate company as defined under Sec.2(6) of the Companies Act 2013 during the yearunder review.
However considering the acquisition of the 72.32% equity stake inKaycee Industries Limited ("Kaycee") from its Promoter under Definitive SharePurchase Agreement and eventual acquisition of further equity stake from the shareholdersof Kaycee in terms of Open Offer under SEBI (Substantial Acquisition of Shares andTakeover) Regulation 2011 Kaycee will become the subsidiary Company to your company aftercustomary closing of the transactions during the current fiscal.
During the Financial year under the review your Company has notaccepted any deposits within the meaning of Section 73 of the Companies Act 2013 read withCompanies (Acceptance of Deposits) Rules 2014. As such there was no deposits as at March312019.
14. STATUTORY AUDITORS
In terms of Proviso to Section 139 (1) of the Companies Act 2013M/s.Swamy & Ravi Chartered Accountants (FRN:004317S) Coimbatore had been appointed asa statutory auditor of the Company by the Members at their 29th Annual GeneralMeeting held on August 9 2014 for a term five years commencing from Financial year2014-15 till the conclusion of the 34th Annual General Meeting for theFinancial year 2018-19.
Taking into account the vacation of the office by above existingstatutory auditor with the date of the 34th Annual General Meeting scheduled tobe held on August 102019 your Board based on the recommendation of the Audit Committeeand subject to the approval of the members approved the appointment of M/s. JDSAssociates Chartered Accountant as the Statutory Auditors of the Company for a term ofFive years from the conclusion of the 34th Annual General Meeting till theconclusion of the 39th Annual General Meeting forthe financial year 2023-24.
M/s. JDS Associates vide its letter dated May 08 2019 has giventheir Consent to become the Statutory Auditor and confirmed to the effect that
The Audit Firm eligible to be appointed as Statutory Auditorand has not incurred any disqualifications under the Companies Act 2013;
The Audit Firm is not disqualified for appointment under theprovisions of Chartered Accountants Act 1949 and rules and regulations made there under;
The proposed appointment is as per the terms provided undertheCompanies Act 2013;
The proposed appointment is within the limits laid down by orunder the authority of the Companies Act 2013;
No orders have been issued and there are no proceedings pendingagainst the firm with respect to professional matters of conduct before the Institute ofChartered Accountants of India any competent authority or any court and
The Firm has been subjected to the peer review process of theInstitute of Chartered Accountants of India (ICAI) and holds a valid certificate issued bythe Peer Review Board of the ICAI.
The Company has adequate measures to review the significant impact byway of any increase/ decrease of the fair value of the investments and accordingly beingdealt with in the financial statements of the Company. During the reporting period therewas no significant variance in the fair value of the Investments.
The Independent Audit Report along with the Annexure as prescribedunder Companies (Auditors' Report) Order 2015 as issued by the Auditors' are appended inthis Annual Report wherein the Auditors have not made any qualification / adverse remarksbased on the auditing.
17. EXTRACT OF THE ANNUAL RETURN
In compliance with Rule 12(1) of the Companies (Management andAdministration) Rules 2014 the extract of the annual return in Form No. MGT 9 forms partof the Board's report given as Annexure: 2.
18. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
The details of conservation of energy technology absorption foreignexchange earnings and outgo given as Annexure: 3.
19. CORPORATE SOCIAL RESPONSIBILITY (CSR)
In terms of the provisions of section 135 of the Companies Act 2013read with Companies (Corporate Socia (Responsibility Policy) Rules 2014 the Board ofDirectors of your Company has constituted a Corporate Social Responsibility("CSR") Committee. The composition and terms of reference of the CSR Committeeis provided in the Corporate Governance report which forms part of this report. YourCompany has also in place a CSR Policy and the same is available on your Company's websitewww.salzergroup.net /investor.
The Company for the past many years has been fulfilling theobjectives of social nature in the area of education health and other social causes inand around Periyanaickenpalayam Region Coimbatore District. The Company primarily throughits Trust has been promoting education healthcare etc.. The Company is at the serviceof the Society in general for up-liftment of literacy and health care.
Accordingly the Company was required to spend र 53.11 lakhstowards CSR activities and against which spent र 53.20 lakhs in respect of variousspecified activities enshrined in Schedule VII of the Companies Act 2013 and also inSalzer's Corporate Social Responsibility Policy. The Annual Report on the CSR Activitieshas been attached with this report as Annexure:4
A) Changes in Directors and Key Managerial Personnel
During the year under review there was no change in the BoardComposition either by appointment or resignation or Change in designation.
B) Retirement by Rotations
Mr.D.Rajeshkumar Joint Managing Director and Mr.RRamachandran WholeTime Director who are retiring Directors in the ensuing 34th Annual GeneralMeeting offered themselves to get reappointed in pursuance of Section 152 of theCompanies Act 2013 read with Article 178 of the Articles of Association of the Company
C) Declaration by the Independent Directors
All Independent Directors have given declarations that they meet thecriteria of independence as laid down under Section 149(B) of the Companies Act 2013 andRegulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulation2015.The Board has optimum composition of the Independent and Non Independent Directors.
D) Continuation / Reappointment of Non-Executive Directors
SEBI based on the recommendation of the Uday Kotak Committee issuedvide Notification on May 09 2018 SEBI (Listing Obligations And Disclosure Requirements)(Amendment) Regulations 2018 which is being effective April 012019. By this amendmentSEBI has introduced new sub regulation 17(1A) under Regulation 17 which provides for asunder
"No listed entity shall appoint a person or continue thedirectorship of any person as a non-executive director who has attained the age of seventyfive (75) years unless a special resolution is passed to that effect in which case theexplanatory statement annexed to the notice for such motion shall indicate thejustification for appointing such a person."
In the light of above new Regulation
> Mr.R.Dhamodharaswamy Non-Executive Non Independent Director whoattained the age of more than 75 years has been re-appointed as the Director by means ofspecial resolutions passed by the Members at their 33rd Annual
General Meeting held on September 222018 and whose term of office issubjected to the retirement by rotation.
> Mr.N.Rangachary Mr. RK.Shah Mr.VSankaran and Mr.N.Jayabal whohave all been appointed by the shareholders as the Independent Directors at the 29thAnnual General Meeting held on August 09 2014 to hold office for the first term of Fiveconsecutive years up to the conclusion of the 34th Annual General Meeting ofthe Company and owing to their attainment of age more than 75 years got approval from theshareholders by means of special resolutions as passed at their Extra Ordinary GeneralMeeting held on March 25 2019 to continue their office till end of theirfirst term.
> Mr.L.Venkatapathy who has been appointed by the shareholders asthe Independent Director at the 30th Annual General Meeting held on August 082015to hold second term of office for Five consecutive years upto the conclusion of the 35thAnnual General Meeting of the Company and owing to attainment of more than 75 years ofage got approval from the shareholders by means of special resolutions as passed at theirExtra Ordinary General Meeting held on March 25 2019 to continue his office till end ofsecond term.
Besides above the shareholders at the aforesaid Extra OrdinaryGeneral Meeting passed requisite special resolutions appointing Mr.N.RangacharyMr.RK.Shah Mr.VSankaran Mr. N.Jayabal and Mr. Nirmal Kumar Chandria as IndependentDirectors on the Board for second term of five consecutive years commencing from theconclusion of 34th Annual General Meeting for the FY 2018-19 till theconclusion of the 39th Annual General Meeting of the Company to be held for theFY 2023-24.
E) Formal Annual Evaluation
SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 mandate that the Board shall monitor and review the Board evaluation framework. Theframework includes the evaluation of directors on various parameters such as: -
Board dynamics and relationships
Relationship with stakeholders
Company performance and strategy
Tracking Board and committees' effectiveness
The Companies Act 2013 states that a formal annual evaluation needs tobe made by the Board of its own performance and that of its committees and individualdirectors. Schedule IV of the Companies Act 2013 states that the performance evaluationof independent directors shall be done by the entire Board of Directors excluding thedirector being evaluated. The evaluation of all the directors and the Board as a whole wasconducted based on the criteria and framework adopted by the Board. The evaluation processhas been explained in the Corporate governance report.
F) Committees of the Board.
Currently the Board has six committees: the Audit Committee theNomination and Remuneration Committee the Corporate Social Responsibility CommitteeStakeholders Relationship Committee the Risk Management Committee the EmployeesCompensation Committee. A detailed note on the composition of the Board and its committeesis provided in the Corporate governance report section of this Annual Report.
21. LISTING REGULATIONS
Your Company has duly complied with various Regulations as prescribedunder SEBI (Listing obligations and Disclosures) Regulations 2015.
The details in respect of the Meeting of the Board of Directors AuditCommittee and all other sub Committee are given in the Corporate Governance Report.
23. VIGIL MECHANISM
A vigil Mechanism has been in place providing opportunity toDirectors/Employees
> To access in good faith to the Audit Committee in case theyobserve unethical and improper practices or any other wrongful conduct in the Company
> to prohibit managerial personnel from taking any adverse personnelaction against those employees and
> to provide necessary safeguards for protection of employees fromreprisals orvictimization
This policy applies to all directors and employees of the Company toreport concerns about unethical behaviour actual or suspected fraud or violation of thecompany's code of conduct or ethics policy
To report such incidents practices etc the concerned Employees /Directors can contact / report to:
Office of the Audit Committee (Compliance Officerl-
E-Mail: firstname.lastname@example.org Contact No. 0422 4233614
Office of the Managing Director-
E-Mail : email@example.com Contact No.0422-4233612
Office of the Joint Managing Director &
Chief Financial Officer-
E-Mail : firstname.lastname@example.org Contact No.0422-4233610
24. PREVENTION OF SEXUAL HARASSMENT AT THE WORK PLACE
The Company has constituted an Internal Committee CIC) in all the Unitsto consider and resolve all sexual harassment complaints reported by women. Theconstitution of the IC is as per the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. Investigation is being conducted and decisions madeby the IC at the respective Unit and a senior woman employee is the presiding officer overevery case.. All employees (permanent contractual temporary trainees) are covered underthis policy.
During the year under review the Committee has not received any suchcomplaint.
25. NOMINATION AND REMUNERATION COMMITTEE
The purpose of the committee is to screen and to review individualsqualified to serve as executive directors non-executive directors and independentdirectors consistent with policies approved by the Board and to recommend for approvalby the Board nominees for election at the AGM.
The committee also makes recommendations to the Board on candidates for
(i) nomination for election or re-election by the shareholders; and
(ii) any Board vacancies that are to be filled.
It also reviews and discusses all matters pertaining to candidates andevaluates the candidates. The nomination and remuneration committee coordinates andoversees the annual selfevaluation of the Board and of individual directors.
The nomination and remuneration committee charter and policy areavailable on our website.
26. POLICY ON THE DIRECTORS APPOINTMENT AND REMUNERATION
In accordance with the Regulation 17 of SEBI (Listing Obligations andDisclosures Requirements) Regulation 2015 read with Salzer's Policy for Nomination andRemuneration the Board is having an optimum combination of the executive non-executiveand independent directors. As of March 31 2019 the Board had thirteen members four ofwhom are executive directors two are non-executive and non-independent member and Sevenindependent directors. One non-executive and non-independent member of the Board is woman.The policy of the Company on directors' appointment and remuneration including thecriteria for determining qualifications positive attributes independence of a directorand other matters as required under sub-section (3) of Section 178 of the Companies Act2013 is available on our website.
We affirm that the remuneration paid to the directors is as per theterms laid out in the Nomination and Remuneration Policy of the Company.
27. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
During the year under review
the Company has not granted/taken loans unsecured from or toCompanies firms or other parties listed in the Register maintained under section 189 ofthe Companies Act 2013 ('the Act') the terms and conditions are not prima facieprejudicial to the interest of the Company during the course of its business and
The investments in other bodies corporate are well within thelimit as prescribed under Section 186 of the Companies 2013.
28. SALZER EMPLOYEES STOCK OPTIONS SCHEME 2012-13
The shareholders at their 27th Annual General Meeting heldon August 11 2012 passed necessary resolutions approving "Salzer Employees StockOption Scheme 2012 -13" for grant of stock options to the eligible employees upto 10%of the paid capital of the Company as a reward to the employees who are behind the growthof the Company.
Accordingly the Employees Compensation Committee constituted by theBoard for administration of Stock option Plan granted 1028000 Stock Optionsconstituting 10% of the paid up capital to such eligible employees with one year vestingperiod and five years exercise period on November 19 2013. The Bombay Stock Exchange(BSE) in its letter dated May 08 2014 granted In-principle approval for allotment of1028000 shares which are likely to arise on exercise of stock options . Further theCompany also on getting listed in NSE Limited has got the requisite In-Principleapproval for the Outstanding Options granted under the Scheme.
With the allotment of 456050 equity shares against the exercise ofsimilar quantum of Stock Options during the reporting period all 1028000 granted stockoptions have been exercised and against which similar number of shares have been allottedduring the exercise period from November 2014 to 2019 and No options left pending forexercise as at 31.03.2019.
The relevant disclosures as required SEBI Guidelines are appendedherewith as Annexure: 5
The Company has received a certificate from the Auditors of the Companythat the Scheme has been implemented in accordance with the SEBI Guidelines and theResolution passed by the shareholders dated August 11 2012. The Certificate will be madeavailable at the Annual General Meeting for inspection by members.
29. RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during thefinancial year under review were on an arm's length basis and were in the ordinary courseof business. During the year the Company had material related party transaction with therelated parties with due compliance of the approval accorded by the shareholders underRelevant Regulation.
All Related Party Transactions are placed before the Audit Committee asalso the Board for approval. Prior omnibus approval of the Audit Committee is obtained ona annual basis for the transactions which are of a foreseen and repetitive nature incompliance with Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The transactions entered into pursuant to the omnibus approval sogranted are audited and a statement giving details of all related party transactions isplaced before the Audit Committee and the Board of Directors for their approval on aquarterly basis. None of the Directors has any pecuniary relationships with respect to thetransactions vis-a-vis the Company.
In response to Rule 8(2) of Companies (Accounts) Rules 2014particulars of contracts or arrangements with related parties during the year under reviewgiven in the Form AOC-2 annexed herewith as Annexure: 6.
30. INSIDER TRADING
The Board of Directors has adopted the Insider Trading Policy inaccordance with the requirements of the SEBI (Prohibition of Insider Trading) Regulation2015. The Insider Trading Policy of the Company lays down guidelines and procedures to befollowed and disclosures to be made while dealing with shares of the Company as well asthe consequences of violation. The policy has been formulated to regulate monitor andensure reporting of deals by employees and to maintain the highest ethical standards ofdealing in Company securities. The Insider Trading Policy of the Company covering code ofpractices and procedures for fair disclosure of unpublished price sensitive informationand code of conduct for the prevention of insider trading is available on our websitewww.salzergroup.net
31. MANAGERIAL REMUNERATION
A) The Company has not employed any individual whose remuneration fallswithin the purview of the limits prescribed under the provisions of Section 197 of theCompanies Act 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 i.e
> No employee of the Company throughout the Financial year was inreceipt of remuneration for that year which in the aggregate for Rupees one Crore andtwo Lakhs rupees and
> No employee of the Company for a part of the Financial year was inreceipt of remuneration for any part of year which in the aggregate for Rupees EightLakhs and Fifty Thousand per month
B) The Company does not have such director who is in receipt of anycommission from the company and who is a Managing Director or Whole-time Director of theCompany receiving any remuneration or commission from any Holding Company or SubsidiaryCompany of such Company
Details pursuant to section 197(12) of the Companies Act 2013 readwith the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 formpart of this Report and are annexed herewith as Annexure - 7.
32. SECRETARIAL AUDIT REPORT
In terms of Section 204 of the Companies Act 2013 the Board ofDirectors of the Company at their meeting held on 11th May 2017 has appointedMr.G.Vasudevan B.Com LLB & FCS M/s.G.V Associates Company Secretaries (Certificateof Practice No. 6522) as the Secretarial Auditor to conduct an audit of the secretarialrecords forthe financial year 2018-19.
The Company has received consent from Mr.G.Vasudevan B.Com LLB &FCS M/s.G.V Associates Company Secretaries to act as the auditor for conducting audit ofthe Secretarial records for the financial year ending 31st March 2019 in terms of Section204 of the Companies Act 2013 read with Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014.
The Secretarial Audit Report for the financial year ended 31st March2019 is set out in the Annexure-8to this report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
33. COMPLIANCE ON SECRETARIAL STANDARDS
The Company complies with all applicable mandatory secretarialstandards issued by the Institute of Company Secretaries of India.
34. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTIONFUND
Pursuant to the applicable provisions of the Companies Act 2013 readwith the IEPF Authority (Accounting Audit Transfer and Refund) Rules 2016 ("theIEPF Rules") all unpaid or unclaimed dividends are required to be transferred by theCompany to the IEPF established by the Government of India after the completion of sevenyears. Further according to the Rules the shares on which dividend has not been paid orclaimed by the shareholders for seven consecutive years or more shall also be transferredto the demat account of the IEPF Authority. During the year the Company has transferredthe unclaimed and unpaid dividends of र 571174/-. Further 138253 correspondingshares on which dividends were unclaimed for seven consecutive years were transferred asper the requirements of the IEPF rules. The details are available on our website atwww.salzergroup.net
35. RISK MANAGEMENT POLICY
Risk management is attempting to identify and then manage threats thatcould severely impact or bring down the organization. Generally this involves reviewingoperations of the organization identifying potential threats to the firm and thelikelihood of their occurrence and then taking appropriate actions to address the mostlikely threats. In order to tackle such risks emanating during the course of businessoperation the Board of Directors constituted Risk Management Committee with an objectiveof identifying the potential threats that are likely to impact the growth of theorganization and evolve suitable measure strategically to mitigate such identified Risks.
36. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
In terms of the provisions of Regulation 34 of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 the Management's discussion and analysis is set out in this Annual Report asAnnexure :9.
37. COST AUDITOR
Pursuant to Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Amendment Rules 2014 the Directors on therecommendation of the Audit Committee and subject to the approval of the Members haveappointed CMA Mr.A.R.Ramasubramania Raja Practicing Cost and Management Accountant asthe Cost Auditor of the Company for the Financial Year 2019-20 to conduct the audit on theMaintenance of Cost Records of the Company and submit the report to the Central Governmentwith the due approval of the Board of Directors within the stipulated time.
38. POLICIES OF THE COMPANY
The Company is committed to good corporate governance and hasconsistently maintained its organizational culture as a remarkable confluence of highstandards of professionalism and building shareholder equity with principles of fairnessintegrity and ethics.
The Board of Directors of the Company have from time to time framed andapproved various Policies as required by the Companies Act 2013 read with the Rulesissued thereunder and the Listing Regulations. These Policies and Codes are reviewed bythe Board and are updated if required.
Some of the key policies adopted by the Company are as follows:
i) Policy on Determination of materiality of events/ information
ii) Policy on prevention of sexual harassment at workplace
iii) Code of Conduct for Directors and Employees
iv) Code of Practices and Procedures for Fair Disclosure of UnpublishedPrice Sensitive Information
v) Code of Conduct to Regulate Monitor and Report trading by Insiders
vi) Policy on Related Party Transactions
vii) Whistle Blower Policy
viii) Corporate Social Responsibility Policy
ix) Nomination and Remuneration Policy
x) Risk Management Policy
39. DIRECTORS' RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act 2013 your Directorsmake the following statements:
> that in the preparation of the annual financial statements for theyear ended March 31 2019 the applicable accounting standards have been followed alongwith proper explanation relating to material departures if any;
> that such accounting policies have been selected and appliedconsistently and judgments and estimates have been made that are reasonable and prudent soas to give a true and fair view of the state of affairs of the Company as at March 312019 and of the profit and loss of the company for that period;
> that proper and sufficient care has been taken for the maintenanceof adequate accounting records in accordance with the provisions of the Companies Act2013 for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
> that the annual financial statements have been prepared on a goingconcern basis;
> that internal financial controls are being followed by the companyand that such internal financial controls are adequate and were operating effectively.
> that systems to ensure compliance with the provisions of allapplicable laws are in place and are adequate and operating effectively
40. CREDIT RATINGS
During the year under review the credit ratings have upgraded to 'CRISILA/Stable' from 'CRISIL A- /Positive' for long term borrowing and 'CRISIL AT reaffirmedfor short term borrowings.
This has been your Company's second rating upgrade over three yearsindicating the Company's comfortable risk profile and confidence in its strategy ofprofitable growth and improvement in quality of its financial parameters through betteroperational performance and further it reflects Company's leading market position in thedomestic rotary switches market and an adequate financial risk profile.
Key drivers in Revision of CRISIL Rating
Leading market position in the domestic rotary switches market
Healthy revenue growth over medium term supported by market leadershipin cam-operated rotary switches segment; launch of higher margin products in wires andcables business and new products such as three-phase dry-type air-cooled transformers andmotor controls
25 years of strong relationship with Larsen & Toubro Ltd(L&T; CRISIL AAA/FAAA/Stable /CRISIL A1+'l ) for distribution of products acrosssegments
Sustained focus on research and development (R&D)
Continued focus on R&D and technology tie-ups with global majorsthat enable the Company to maintain and improve their technology competitiveness
Adequate financial risk profile:
Healthy financial risk profile marked by a comfortable net worth ofर 268 crore and gearing of 0.54 times as on March 31 2018. The Debt protectionmetrics are expected to improve over the medium term with net cash accruals to total debtand interest coverage ratios estimated to improve to 30% and 5.01 times respectively byfiscal 2020.
41. INDUSTRIAL RELATIONS
During the year under review industrial relations at the Companycontinued to remain cordial and peaceful.
42. CAUTIONARY STATEMENT
Statements in the Annual Report particularly those which relate toManagement Discussion and Analysis describing the Company's objectives projectionsestimates and expectations may constitute 'forward looking statements' within the meaningof applicable laws and regulations. Although the expectations are based on reasonableassumptions the actual results might differ.
Your Directors place on record their deep sense of appreciation andgratitude to the Shareholders various Government Agencies Canara Bank Union Bank ofIndia ICICI Bank Citi Bank NA M/s. Axis Bank M/s. HDFC Bank M/s. Larsen & ToubroLimited - Marketing Associates CRISIL M/s.GNSA Infotech Pvt. Ltd (Registrar & ShareTransfer agent) for their continued support and cooperation. Your Directors also wish torecord their appreciation for the dedicated services being rendered by the employees atall levels.
| ||For and on behalf of the Board |
|Place : Coimbatore ||N.RANGACHARY |
|Date : May 24 2019 ||CHAIRMAN |
| ||DIN: 00054437 |
A qualified practicing Company Secretary carried out secretarial auditto reconcile the total admitted capital with National Securities Depository Limited (NSDL)and Central Depository Services (India) Limited (CDSL) vis-a-viz the issued and listedcapital. The secretarial audit report confirms that the total issued / paid-up capital isin agreement with the total number of shares in physical form and the total number ofdematerialized shares held with NSDL and CDSL.
As per the provisions of the Companies Act 2013 the Secretarial Auditfor the year 2018-19 have also been carried out by Mr.G.Vasudevan Practicing CompanySecretary of M/s.G.V. Associates Coimbatore and accordingly his report is appended toDirectors' Report. (See Annexure-8)
The above report has been placed before the Board at its meeting heldon 24th May 2019 and the same was approved.
As provided under Reg.26(3) of SEBI (LODR) Regulations 2015 the BoardMembers and the members of Senior Management have confirmed compliance with the Code ofConduct.
| ||For and on behalf of the Board |
|Place : Coimbatore ||N.RANGACHARY |
|Date : May 24 2019 ||CHAIRMAN |
| ||DIN : 00054437 |
Disclosure pursuant to Section 1341311m) of the Companies Act 2013read with Rule 8(3) of the Companies [Accounts) Rules 2014
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUT GO.
A. CONSERVATION OF ENERGY
Energy conservation is the effort made to reduce the consumption ofenergy by using less of an energy service. This can be achieved either by using energymore efficiently or by reducing the amount of service used. Energy conservation is a partof the concept of eco-sufficiency. Energy conservation reduces the need for energyservices and can result in increased environmental quality national security and highersavings. It also lowers energy costs by preventing future resource depletion.
In this Direction your Company remains conscious to achieve optimalenergy efficiency across the Units and aims to employ continuous measurement of energyconsumptionand review its operating procedures periodically.
B. PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION:
RESEARCH & DEVELOPMENT:
Research and Development (R&D) plays a critical role in theinnovation process. It's essentially an investment in technology and future capabilitieswhich is transformed into new products processes and services. R&D is essential tokeep ahead in the Competition. R&D would make the products to get transformedfrequently in line with changing needs of the end users. Besides new products withcontemporary technologies and new features are being developed at R&D House so to gainthe market share.
As stated in the Directors' Report the recognition of in-house R &D by the Government of India Ministry of Science and Technology Department of Scientificand Industrial Research New Delhi is continuously maintained since 2004 and the presentrenewal of the recognition is valid upto 31.03.2020.
1. Specific areas in which R&D was carried out by the Company.
The R&D wing of the Company has been working to achieve thefollowing objectives:
Sustainability of the quality standards comparable to theinternational standards.
Ensuring process development on continuous basis to be costeffective and cost competitiveness.
Enlarging the utilities of the product by continuous improvementin specifications design etc.
Ensuring technological upgradation and knowhow for the productsof the Company.
Developing new products to increase market share &profitability.
2. Benefits derived as a result of the above R&D activities:
Major products developed by ROD and its significant benefits
1. Energy Saver products
Energy Saver products developed by the Company has got good response inthe market. Corporations across the country are showing interest to adopt these productsin their street lightings in order to save the energy and cut power cost considerably.
Guaranteed operating efficiency of 97% (higher than industrystandards) with the use of highly efficient Toroidal transformers
Dynamic Voltage reduction: provides stabilized voltage to thelamps
Automatic On/Off based on Sunrise/Sunset or on programmedtimings
Wireless control and monitoring through sophisticated web-basedsoftware
Automatic bypass in case of tripping with manual changeover incase of maintenance or emergency
Reduces operational maintenance and running cost
Reliable and safe changeover with On-Load tap changing
Completely remote programmable ON/OFF timings alert and energysaving settings
Instantaneous alerts for critical fault conditions to yourmobile phone
Energy saving reports and lamp failure reports on daily weeklyand monthly basis for single multiple or all devices
Detection of Energy theft or leakage
Maintains a high power factor of above 0.85
Guaranteed operating life of 10 years: No moving parts ensuringlong life
Eco-friendly - First in India to adhere to RoHS compliance
Reduces public inconvenience
Lighting levels conforming to ISI Standards
2. Automated Meter Reading Benefits.
All consumer lines (Energy Meters) are connected with AMRmodules
All the AMR modules will communicate to a single IP i.e. allthe readings shall terminate at the central station
Unpaid consumer accounts can be disconnected & re-connectedfrom the central station itself
Any tampering / fault occurrence of the meter can be found fromthe central station itself Hardware can be retrofitted to existing static energy meters
Real-time data configurable for a frequency as less than 15/30minutes is available in the Control Station
Low implementation costs & Low Maintenance /Operating Cost
AMR System becomes inherently expandable i.e. addition of a newservice at any point in the power line becomes plug n play
Real-time data available
3. Other Products Train Warning System Energy saving Fanregulator Ceiling Mount movement sensor Touch cum remote switch GE Earth TerminalBimetallic Overload Relay Different Type of Sensors Contactors and Overloaded relaysupto 105 A Motor protection circuit breakers DC isolators for PV applications TinnedCopper Wires etc. are developed by your R&D and are in different stage of testing andapproval which will give considerable benefits on its usage.
Technology Absorption Adaptation & Innovation
1. Efforts in brief made towards technology absorption adaptationand innovation:
The Company signed technical licensing agreement withAustria-based Trafomodern Austria so to use former technology and design and assistanceto manufacture dry type air cooled transformers Chokes and inductors in India. Dry typetransformers is a highly
specialised and technical product with applications in Medium& large UPS renewable energy business railways power generation and the marineindustry. Trafomodern is one of the leading manufacturers of dry type transformers inEurope.
The Company has set up state of the art manufacturing facility andcommenced the production during the Third quarter in 201617.
The Company signed a Distribution Agreement with IPD GroupLimited of Australia a Leading Electrical distributor/Wholesaler and manufacturer inAustralia for marketing and selling of Salzer Branded Electrical products for SolarPhotovoltaic Applications in Australia and Newzeland. This understanding with IPD opens tothe Company a Large New Market for its internationally tested and approved products.
Your Company has also undertaken the development of Contactorsfor C3 Controls USA who is one of the reputed manufacturer and supplier of the electricalgoods worldwide.
2. During the year under review the following expenditures wereincurred with regard to R & D:
| Capital Expenditure as additions to Plant & Machineries Tools Dies etc. ||र 750.06 Lakhs |
| New Products and Process development ||र 96.19 Lakhs |
| Salary and other expenses for R&D personnel ||र 120.46 Lakhs |
4. Details of Imported Technology:
| Technology ||For the manufacture of |
|Imported ||(i) CAM Operated Rotary Switches |
| ||(ii) Toroidal Transformers |
| ||(iii) Three phase try type transformer |
|. Year of Import ||(i) 1985 |
| ||(ii) 1995 / 2005 |
| ||(iii) 2016 |
| Has the technology been fully absorbed ||Yes Fully absorbed. |
C. FOREIGN EXCHANGE EARNINGS AND OUTGO:
|a) Foreign Exchange earned during the year (Direct export र 5613.87 Lakhs & र 21.72 Lakhs for technical services) ||र 5635.59 Lakhs |
|b) Foreign Exchange outgo ||र 8813.37 Lakhs |
| ||For and on behalf of the Board |
|Place : Coimbatore ||(Sd/-) N.RANGACHARY |
|Date : May 24 2019 ||CHAIRMAN |
DISCLOSURES UNDER RULE 12(91 OF COMPANIES (SHARE CAPITAL ANDDEBENTURES) RULES 2014 READ WITH REGULATION 14 OF SEBI (SHARE BASED EMPLOYEES BENEFITS)REGULATIONS 2014.
DETAILS OF THE SCHEME
Your Company believes that appropriate appreciations and rewards to theemployees for their contribution all these years would enable the Company to take itsgrowth objectives forward with strong aspirations.
In this directions a Scheme by name "Salzer Employees Stockoption Scheme 2012-13" (shortly "Salzer ESOS 2012-13") was instituted withthe approval of the shareholders by means of special resolutions passed at their 27thAnnual General Meeting held on August 11 2012. The Scheme is in compliance with SEBI(Share Based Employees Benefits) Regulations 2014. The Scheme is administered by EmployeesCompensation Committee.
Some Salient Features of the Scheme
1) The total number of options to be granted under this Scheme shallnot exceed 10% of the Paid-up Share Capital of the Company as on 31.03.2012 i.e. 1028374Options (10% of 10283737 Equity Shares)
2) One Option entitles the holder of the options to apply forand beallotted one equity share of र 10/- of the Company
3) Chief Executive Officer / President (not being the Promoter /Promoter Group) / Whole Time Director (not being the Promoter / Promoter Group)/Independent Director and other key senior management personnel posted in India or outsideIndia and other employees who are in regular role of the company as may be determined byEmployees Compensation Committee
4) Employee(s) / Director(s) as stated above in respect of thewholly-owned subsidiary(ies) / holding Company(ies) of the company whether in India oroutside
5) The scheme shall not apply to :-
an employee who is a promoter or belongs to the PromoterGroup.
Director who either by himself or through his relative(s) orthrough any Body Corporate(s) directly or indirectly holds more than 10% of theoutstanding equityshares of the company.
Nominee Director and
B) There shall be minimum period of one year between the grant of theoptions and the vesting of options.
Status of the Scheme.
1) In accordance with the Scheme 1028000 options granted on November19 2013 to eligible employees at a grant price of र 40/- against closing price ofर 48.60/- prevailed on November 18 2013 with a discount of र 8.60 per shareconstituting 22% of the grant price.
2) The vesting period of options is one year from the date of grant andexercise period is five years from the date of vesting.
3) The shares so allotted upon exercise of stock options by theemployees shall be locked in for a period of two years from the date of allotment.
4) The exercise period of Five years from the date of vesting commencedon November 18 2014 and getting ended on November 17 2019
5) As on the date of this report the entire 1028000 vested StockOptions exercised by the Employees over the period of years since the date of vesting andagainst which similar number of equity shares allotted to them.
INFORMATION UNDER RULE 12(91 OF COMPANIES (SHARE CAPITAL ANDDEBENTURES) RULES 2014
|1 ||Scheme Name ||: Salzer Employees Stock option Scheme 2012-13 |
|2 ||Options granted ||: 1028000 Options @ grant price of र 40/- per Options |
|3 ||Options vested ||: 1028000 Options on November 19 2014 |
|4 ||Options exercised |
(from the date of vesting to March 31 2019)
|: 1028000 Options |
|5 ||Options exercised during the reporting year ||: 456050 Options |
|B ||Total number of shares arising as a result of exercise of option from the date of vesting to March 31 2019) ||: 1028000 Equity shares of र 10/- each |
|7 ||Total number of shares arising as a result of exercise of option during the reporting year ||: 456050 Equity shares of र 10/- each |
|8 ||Options lapsed ||: NIL |
|9 ||The exercise price ||: र 40/- per share |
|11 ||Variation of terms of options ||: NIL |
|12 ||Total number of shares arising as a result of exercise of option during the reporting year ||: 456050 Equity Shares |
|13 ||Money realized by exercise of options (456050 Options exercised during the year) ||: र 18242000/- |
|14 ||Total number of options in force ||NIL |
|15 ||Employee wise details of options granted to || |
key managerial personnel as at March 312019 : Nil
any other employee who receives a grant of options in any oneyear of option amounting to five percent or more of options granted during that yea : Nil
identified employees who were granted option during any oneyear equal to or exceeding one percent of the issued capital (excluding outstandingwarrants and conversions) of the company at the time of grant: Nil
Diluted Earnings per share (EPS) pursuant to the issue of shares on theexercise of options calculated in accordance with Indian Accounting Standard (Ind AS) 33" Earning per share" : र 15.10 per share in FY 2018-19 against र13.45 per share in FY 2017-18.
| ||For and on behalf of the Board |
| ||N RANGACHARY |
|?ate : May 242019 ||Chairman of CSR Committee |
|Place : Coimbatore ||?IN :00054437 |
FORM NO. AOC-2
(Pursuant to clause (hi of sub-section (31of section 134 of the Act andRule 8(2) of the Companies (Accounts) Rules 2014)
Form for disclosure of particulars of contracts/arrangements enteredinto by the company with related parties referred to in sub-section (1) of section 188 ofthe Companies Act 2013 including certain arm's length transactions under third provisothereto
1. DETAILS OF CONTRACTS OR ARRANGEMENTS OR TRANSACTIONS NOT AT ARM'SLENGTH BASIS
|a ||Name(s) of the related party and nature of relationship ||NIL |
|b ||Nature of contracts/arrangements/transactions ||NIL |
|c ||Duration of the contracts / arrangements/ transactions ||NIL |
|d ||Salient terms of the contracts or arrangements or transactions including the value if any ||NIL |
|e ||Justification for entering into such contracts or arrangements or transactions ||NIL |
|f ||?ate(s) of approval by the Board ||NIL |
|a ||Amount paid as advances if any ||NIL |
|h ||?ate on which the special resolution was passed in general meeting as required under first proviso to section 188 ||NIL |
2. DETAILS OF MATERIAL CONTRACTS OR ARRANGEMENT OR TRANSACTIONS ATARM'S LENGTH BASIS
|a ||Name(s) of the related party and nature of relationship ||: NIL |
|b ||Nature of contracts/arrangements/transactions ||: NIL |
|c ||Duration of the contracts / arrangements/ transactions ||: NIL |
|d ||Salient terms of the contracts or arrangements or transactions including the value if any ||: NIL |
|e ||?ate(s) of approval by the Board if any or such other approvals ||: NIL |
|f ||Amount paid as advances if any ||: NIL |
DETAILS PURSUANT TO THE PROVISIONS OF SECTION 197(121 OF THE COMPANIESACT 2013 READ WITH RULE 5(11 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIALPERSONNEL) RULES 2014
(i) The ratio of the remuneration of each director to the medianremuneration of the employees of the company for the financial year;
|SI. No. ||Name of the Director ||Position ||Total Remuneration for FY 19 (र Lakhs) ||Ratio of Remuneration of the Director to the median Remuneration |
|1 ||Mr. N.Rangachary ||Non-Executive & Independent Chairman ||2.70 ||1.00 |
|2 ||Mr. R.Doraiswmay ||Managing Director ||72.54 ||26.77 |
|3 ||Mr. D.Rajeshkumar ||Joint Managing Director & Chief Financial Officer ||70.84 ||26.14 |
|4 ||Mr. RRamachandran ||Whole Time Director (Marketing) ||13.75 ||5.07 |
|5 ||Mr. R.Damodharaswamy ||Non executive Director ||0.90 ||0.33 |
|B ||Dr.Thilagam Rajesh ||Non executive Director ||1.20 ||0.44 |
|7 ||Mr. N.Jayabal ||Independent Director ||1.50 ||0.55 |
|8 ||Mr. Nirmal Kumar Chandria ||Independent Director ||1.50 ||0.55 |
|9 ||Mr.VSankaran ||Independent Director ||2.85 ||1.05 |
|10 ||Mr. RK.Shah ||Independent Director ||1.65 ||0.61 |
|11 ||Mr. L.Venkatapathy ||Independent Director ||2.55 ||0.94 |
|12 ||Mr.Otto Eggimann ||Independent Director ||- ||- |
|13 ||S. Baskarasubramanian ||Director (Corporate Affairs) & Company Secretary ||17.79 ||6.57 |
Remuneration includes sitting fees
Non-executive Directors and Independent Directors have been paidonly sitting fees for attending the Board Meetings and Committee thereof
(ii) the percentage increase in remuneration of each director ChiefFinancial Officer Chief Executive Officer Company Secretary or Manager if any in thefinancial year;
|SI. ||Name of the Director ||Position ||Remunerate ||n (र Lakhs) ||Increase |
|No. || || ||2018-19 ||2017-18 ||% |
|1 ||Mr. N.Rangachary ||Non-Executive & Independent Chairman ||2.70 ||2.20 ||23% |
|2 ||Mr. R.Doraiswmay ||Managing Director ||72.54 ||64.50 ||12% |
|3 ||Mr. D.Rajeshkumar ||Joint Managing Director & Chief Financial Officer ||70.84 ||62.88 ||13% |
|4 ||Mr. RRamachandran ||Whole Time Director (Marketing) ||13.75 ||10.82 ||27% |
|5 ||Mr. R.Damodharaswamy ||Non executive Director ||0.90 ||0.50 ||80% |
|B ||Dr.Thilagam Rajesh ||Non executive Director ||1.20 ||1.10 ||9% |
|7 ||Mr. N.Jayabal ||Independent Director ||1.50 ||0.90 ||67% |
|8 ||Mr. Nirmal Kumar Chandria ||Independent Director ||1.50 ||1.10 ||36% |
|9 ||Mr.VSankaran ||Independent Director ||2.85 ||2.35 ||21% |
|10 ||Mr. RK.Shah ||Independent Director ||1.65 ||1.25 ||32% |
|11 ||Mr. L.Venkatapathy ||Independent Director ||2.55 ||2.35 ||9% |
|12 ||S. Baskarasubramanian ||Director (Corporate Affairs) & Company Secretary ||17.79 ||17.04 ||4% |
(iii) The percentage increase in the median remuneration of employeesin the financial year 7 %
(iv) The number of permanent employees on the rolls of company as atMarch 312019-568
(v) Average Percentile increase already made in the salaries ofemployees other than the managerial personnel in the last Financial year and itsComparison with the percentile increase in the managerial Remuneration and justificationthereof and point out if there are any exceptional Circumstances for increase in themanagerial remuneration;
The average increase granted to employees other than managerialpersonnel is 15 %
The increase granted to managerial personnel is 13%
(vi) Affirmation that the remuneration is as per the remunerationpolicy of the Company.
It is hereby affirmed that the remuneration paid during the year is asper the Remuneration Policy of the Company.
| ||For and on behalf of the Board |
| ||N RANGACHARY |
|Date : May 24 2019 ||Chairman of CSR Committee |
|Place : Coimbatore ||DIN :00054437 |