Your Directors are pleased and privileged to present 35thAnnual Report andthe Audited Accounts of the Company for the year ended March 31 2021.
Financial Results (` In Lakhs)
|Particulars ||2020-21 ||2019-20 |
|Gross total income from operations ||27567.96 ||29013.61 |
|Other Income ||141.31 ||126.26 |
|Profi t before Interest Depreciation and Tax (PBIDT) ||3794.52 ||4015.63 |
|Interest ||104.75 ||103.17 |
|Profi t before depreciation and Tax (PBDT) ||3689.77 ||3912.46 |
|* Depreciation ||1298.41 ||1276.29 |
|Profi t before Exceptional Item ||2391.36 ||2636.17 |
|C S R ||58.11 ||41.00 |
|Extraordinary Item ||0 ||0 |
|Profi t after CSR ||2333.25 ||2595.17 |
|Provision for Taxation || || |
|i) Current Year ||606.87 ||659.36 |
|ii) Deferred Taxation ||-6.05 ||-24.00 |
|Net Profi t before Extraordinary Item ||1732.42 ||1959.81 |
|Extraordinary Item ||0 ||0 |
|Profi t after Extraordinary Item ||1732.42 ||1959.81 |
Note: Figures have been re-grouped wherever necessary to confi rm to current periodclassifi cation.
Your Directors recommended dividend of Rs. 5/- per equity shares (50%) of face value ofRs.10/- each for the year 2020-21. The dividend if approved by the shareholders at 35thAGM will be paid within 30 days to the shareholders as on cut-off date i.e. 21.09.2021
The companys financial discipline and prudence is refl ected by becoming a debtfree company for the last few years and credit ratings ascribed by CRISIL
Long term rating : CRISILA- /Stable (Reaffi rmed) Short term Rating : CRISILA2+ (Reaffirmed) Review of business operations:
In the year 2020-21 the Domestic & Global Automotive Industry was passing throughone of the most challenging times with the introduction of B. S. VI models and alsointroduction of electric vehicles pushed Domestic Auto industry to slow down. Moreoverrural economy showed signs of slow down. Domestic Industry performed 10 to 15% less thanpre covid pandemic Company achieved the targets for the last three quarters and in the 1stquarter during the year sales dropped down to the rock bottom because of Covid 19 effectCompany taken effective steps for manufacturing cost effective production. Companyachieved reasonably good financial results. The Company posted the gross turnover ofRs.27567.96 lakhs during year 2020-21 as against Rs.29013.61 Lakhs in the previous year2019-20 and Net turnover of Rs.22484.46 Lakhs during the year 2020-21 as compared to Rs.23558.28 Lakhs for the previous year 2019-20.
The company R&D expenditure is Rs.55.41 Lakhs during the year to catch up withup-gradation of technology and to meet OEMs ever demanding quality and newdevelopments requirement to improve life cycle of their product meeting BS-VI norms ofenvironmental standards for Auto components. The operations of the Company on the wholehave been satisfactory.
In pursuance of National Electric Mobility Machine Plan (NEMMP) and other initiativesand Government to achieve long term growth in industry and reduced emissions and oildependents. To meet these stringent environmental regulations on pollution and carbonemissions have necessitated heavy investments in both automobile and also auto parts suchas our industries. Company is now focusing customer preferences and distributions channelsand always exploring new avenues in the export market and Domestic Replacement marketwhich will give encouraging results. Earnings Before Depreciation Interest and Tax(PBDIT) at Rs.3736.41 lakhs as against previous year of Rs. 3974.63 Lakhs. The Profi tBefore Tax was at Rs. 2333.25 lakhs as compared to Rs. 2595.17 lakhs in 2019-20 andecrease of 10.09%
In line with motto of Reshaping our business for tomorrow Samkrg is servingthe growing needs of our Business Accounts and Individual Customers of export and domesticand also OEM Customer segments by offering cost effective prices and different Productsand Services. Our end to end operation across the value chain from gross level customersenable us to deliver superior quality products. Over the years we have built strongrelationship with the domestic and overseas customers and other channel partners that hasallowed us to serve all Customer segments through our nationwide professional distributionnetwork. We are now leveraging this extensive network established for our products toextend our customer-centric services. Company identifi ed some parts common to electricalvehicles and planning for diversifi cation.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 with respect to the DirectorsResponsibility Statement the Board of Directors of the Company hereby confi rms:
? In the participation of Annual Accounts the applicable Indian accounting standardshave been followed and that there have been no material departures.
? The Directors had selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at March 31 2021 and the profi t lossaccount of the Company for that period.
? The Directors had taken proper and suffi cient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.
? The Directors had prepared the Annual accounts on a going concern basis and
? The Directors in the case of listed company had laid down internal financialcontrols to be followed by the company and that such internal financial controls areadequate and were operating effectively
? The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
? The Companys Internal Auditors have conducted periodic audit to providereasonable assurance that the Companys established policies and procedures have beenfollowed. The Audit Committee of the Board meets once in a quarter with Internal Auditorsto review internal control and financial reporting issues.
RISK MANAGEMENT COMMITTEE
Risk management committee consists of the following Directors:
|1. Mr. S.D.M. Rao ||Chairman |
|2. Mr. S Madhava Rao ||Member |
|3. Mr. K Chaitanya Abhishek ||Member |
RISK MANAGEMENT POLICY
The company has taken all the steps to mitigate the following risks: Raw materialprices: Ours is a continuous high volume manufacturing industry. Our profi tability willdepend on change in the price in raw materials and input costs.
Foreign currency Risks: Exchange rate fl uctuations may sometimes effect. Adequatesteps were taken. Competition and Price Pressure: The Company is facing stiff competitionin the segments of OEMs and aftermarket as well as price pressure from the OEMs whichplaying major roll on the profi tability of the company.
CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
The Corporate Social Responsibility committee consists of the following Directors:
|1. Mr. S Kishore ||Chairman |
|2. Mr. Pinninti Raghu Prakash Swamy ||Member |
|3. Mr. K Chaitanya Abhishek ||Member |
Corporate social responsibility policy was adopted by the Board of Directors on therecommendation of corporate social responsibility committee. Report on corporate socialresponsibility as per Rule 8 of Companies (Corporate Social Responsibility) Rules 2014 isprepared and the same is enclosed as annexure - 3.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SECTION 149(6)
The Independent Directors have submitted the declaration of independence as requiredpursuant Sec. 149(7) of the Companies Act 2013 stating that they meet the criteria ofindependence as provided in Sec. 149(6).
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee consists of the following Directors namelyMr. K Chaitanya Abhishek Ms. Nama Rishita and Mr. S. MadhavaRao.
Brief description of terms of reference:
? Identifying persons who are qualifi ed to become directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardfor their appointment and removal;
? Carry on the evaluation of every directors performance;
? Formulation of the criteria for determining qualifi cations positive attributes andindependence of a director;
? Recommend to the Board a policy relating to the remuneration of the directors keymanagerial personnel and other employees;
? Formulation of criteria for evaluation of independent Directors and the Board;
? Devising a policy on Board diversity; and
? Any other matter as the Board may decide from time to time.
Nomination and Remuneration policy The objective of the Policy:
1. To lay down criteria and terms and conditions with regard to identifying persons whoare qualifi ed to become Directors (Executive and Non-Executive) and persons who may beappointed in Senior Management and Key Managerial positions and to determine theirremuneration.
2. To determine remuneration based on the Companys size and financial positionsand trends and practices on remuneration prevailing in peer companies.
3. To carry our evaluation of the performance of Directors.
4. To provide them reward linked directly to their effort performance dedication andachievement relating to the Companys operations.
5. To retain motivate and promote talent and to ensure long term sustainability oftalented managerial persons and create competitive advantage.
POLICIES ON APPOINTMENT OF DIRECTORS AND REMUNERATION
Your Company recognizes the importance and benefi ts of having the diverse Board toenhance quality of its performance and has adopted a Nomination and Remuneration Policy asformulated by the Board of Directors. The Companys Nomination and RemunerationPolicy has laid down a framework for remuneration of Directors (Executive andNon-Executive) Key Managerial Personnel and Senior Management Personnel.
These Policies are available on the Companys website at thehttps://www.samkrgpistonsandrings.com
PERFORMANCE EVALUATION OF DIRECTORS AT BOARD AND INDEPENDENT DIRECTORS MEETINGS
Pursuant to the provisions of the Act and Listing Regulations the Board has carriedout an annual performance evaluation of its own performance the directors individually aswell as the evaluation of the working of its various Committees for the financial year2020-21. The evaluation was conducted on the basis of a structured questionnaire whichcomprises performance criteria such as performance of duties and obligations independenceof judgement level of engagement and participation attendance of directors theircontribution in enhancing the Boards overall effectiveness etc. The Board hasexpressed their satisfaction with the evaluation process. The observations made during theevaluation process were noted and based on the outcome of the evaluation and feedback ofthe Directors the Board and the management agreed on various action points to beimplemented in subsequent meetings. The observations included those relating to furtherimprovement in participation and deliberations at the meetings and conduct of themeetings circulation of board presentations and its content.
The independent directors met on 23.06.2020 without the presence of other directors ormembers of Management. All the independent directors were present at the meeting. In themeeting the independent directors reviewed performance of non-independent directors theBoard as a whole and Chairman. They assessed the quality quantity and timeliness of fl owof information between the Company management and the Board.
Pursuant to Regulation 25(7) of the SEBI (LODR) Regulations the Company has put inplace a system to familiarize its Independent Directors about the Company its financialproducts the industry and business model of the Company. In addition the Company alsoupdates on continuous basis to the Independent Directors about the ongoing events anddevelopments relating to the Company signifi cant changes in regulatory environmentthrough the Board/ Committee meetings and separate familiarisation programme(s).Familarisation Programme details:
|(i) No. of programmes attended by ||During the year ||3 |
|Independent Director (during the year and on a cumulative basis till date) ||Cumulative ||19 |
|(ii) No. of hours spent by Independent ||During the year ||3.30 |
|Directors in such programmes (during the year and on a cumulative basis till date) ||Cumulative ||21.30 |
Pursuant to Regulation 46 of SEBI (LODR) Regulations the details of FamiliarizationProgramme is uploaded on the Companys website.
POLICY FOR PROHIBITION OF INSIDER TRADING
Vide notifi cation No.EBI/LAD-NRO/GN/2018/59 Securities and Exchange Board of India(SEBI) has notifi ed SEBI (Prohibition of Insider Trading) (Amendment) Regulations 2018with effect from April 01 2019. The Company has accordingly formulated and adopted Codefor Fair Disclosure of Unpublished Price Sensitive Information. The said code is alsoavailable on the website of company.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS UNDER SECTION 186:
The company has neither issued any Loans Guarantees nor made any investments duringthe Financial year 2020-21.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO Sec. 188(1)
The particulars of contracts or arrangements with related parties referred to Section188(1) are prepared in form No.AOC-2 pursuant to Section 134(3)(h) of the Act and Rule8(2) of the Companies (Accounts) Rules 2014. The details of the transactions with relatedparties are given in the financial statements.
TRANSFER OF AMOUNTS TO RESERVES
The Company proposes to transfer an amount of Rs.502.40 lakhs to the general reservefor the financial year ended 31stMarch 2021.
LISTING OF EQUITY SHARES
The Companys equity shares are listed on BSE Ltd. PJ Towers Dalal StreetMumbai 400001.
MEETINGS OF THE BOARD OF DIRECTORS
The details of the Board of Directors Meeting held were given in the Report onCorporate Governance under Item No. 2(b).
EXTRACT OF ANNUAL RETURN
The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of theCompanies Act 2013 and Rule 12 of the Companies (Management and Administration) Rules2014 and the same is enclosed as Annexure-1 to this report.
The conservation of energy technology absorption foreign exchange earnings and outgopursuant to provisions of Sec. 134(3) (m) of the Companies Act 2013 read with theCompanies (Accounts) Rules 2014.
Information with respect to the conservation of energy technology absorption foreignexchange earnings and outgo pursuant to provisions of Sec. 134(3)(m) of the Companies Act2013 read with the Companies (Accounts) Rules 2014 is prepared and annexed as Annexure -2to this report.
BOARD OF DIRECTORS
Pursuant to the provisions of Section 152 and other applicable provisions of theCompanies Act 2013 Shri S Kishore (DIN: 01665768) who retires by rotation and beingeligible seeks for re-appointment. Based on performance and recommendation of nominationand remuneration committee the Board recommends his re-appointment.
Ms. N Rishita was re-appointed as Woman Independent Director for 5 years w.e.f.23.09.2020 vide special resolution passed at 34th AGM held on dated 23rd September 2020.
Key Managerial Persons
There is no change in Key Managerial Persons during the year 2020-21.
The Company has not accepted any Deposits in terms of Section 73 of the Companies Act2013 and the rules made there under and hence compliance with the same is not applicable.
TRANSFER OF UNCLAIMED SHARES AND DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to the provisions of Section 124(5) of the Companies Act 2013 all unpaid orunclaimed dividends for a period of seven years are required to be transferred by theCompany to the Investor Education and Protection Fund (IEPF) established by the CentralGovernment.
Accordingly the Company has transferred the unclaimed dividends upto the financial year2012-13.
Further Section 124(6) of the Companies Act 2013 requires that all shares in respectof which unpaid or unclaimed dividend has been transferred to IEPF shall also betransferred to demat account of IEPF. In view of above provisions Company has transferredsuch shares to the Investor Education and Protection Fund Account and the list isavailable at our website www.samkrgpistonsandrings.com
AUDITORS Statutory Auditors
At the Annual General Meeting held on 25th September 2017 M/s. Sridhara Chary V &Co. Chartered Accountants were appointed as statutory Auditors of the Company to holdoffi ce till the conclusion of the Annual General Meeting to be held in the calendar year2022.
Since the requirement of ratifi cation of appointment of Statutory Auditors every yearby the Members of Company has been dispensed with w.e.f. May 7 2018 vide Companies(Amendment) Act 2017 no resolution is being proposed for ratifi cation of appointment ofStatutory Auditors at the AGM.
There are no qualifi cations reservations or adverse remarks made by M/s SridharaChary V & Co. chartered Accountants Hyderabad Chartered Accountants (ICAI Reg.No.011478S) Statutory Auditors in their report for the Financial Year ended March 31st2021.
Composition of Audit Committee included in Corporate Governance report.
Mr. NVS Kapardi (Membership No. 9488) Cost Accountant in practice having fi rmregistration no. 100231 has been appointed by the Board as Cost Auditors of the Company toconduct audit of its cost accounting records for the financial year 2021-22.
In accordance with the requirement of the Central Government and pursuant to theprovisions of Section 148 of the Act the Company has maintained the cost records for F.Y.2020-21 as applicable. The Company also carries out an annual audit of its cost accountingrecords throughCost Auditors.
The remuneration payable to the Cost Auditors is required to be placed before themembers in General Meeting for their ratifi cation. Accordingly a resolution for theremuneration of said cost auditor is included in the AGM notice of the Company vide itemno. 4 annexed to the Annual Report.
As per the provisions of Section 204 of the Companies Act 2013 the Board of Directorsat their meeting held on dated 21.06.2021 have appointed to Mr. V B S S Prasad PracticingCompany Secretary (C.P.No: 4605) as Secretarial Auditor to conduct Secretarial Audit ofthe
Company for the Financial year 2021-22. Corporate Governance
A separate report on Corporate Governance is annexed as part of the Annual Report alongwith the Auditors Certifi cate on its compliance.
The Board of Directors has adopted whistle Blower policy. The Whistle Blower policyaims for conducting the affairs in the fair and transparent manner by adopting higheststandards of professionalism honest integrity and ethical behavior. All permanentemployees of the Company are covered under the Whistle Blower Policy.
A mechanism has been established for employees to report concerns about unethicalbehavior actual or suspected fraud or violation of Code of Conduct and Ethics. It alsoprovides for adequate safeguards against the victimization of employees who avail of themechanism and allows direct access to the chairperson of the audit committee inexceptional cases.
SECRETARIAL AUDITOR REPORT
As per the provisions of Section 204 of the Companies Act 2013 the Board of Directorshad appointed Mr. V B S S Prasad Practicing Company Secretary (C.P.No: 4605) asSecretarial Auditor to conduct Secretarial Audit of the Company for the Financial yearended 31st March 2021.
Secretarial Audit Report issued by Mr. V B S S Prasad Practicing Company Secretary inform MR-3 is enclosed as Annexure - 4 to this Annual Report.
There are no qualifi cations in Secretarial Audit Report.
PARTICULARS OF APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL:
The Statement of particulars of Appointment and Remuneration of Managerial Personnel asper Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as enclosed as per Annexure - 5 to this Annual Report.
All properties and insurable interests of the Company including building plant &machinery and stocks have been fully insured.
CHANGE IN NATURE OF BUSINESS
There is no change in the Companys nature of business during the financial yearended March 31st 2021.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The company has well defi ned internal control systems and procedures for ensuringoptimum utilization of various resources Investment decisions involving CapitalExpenditure or taken up only after due appraisal and review. Internal audit functioncovers and carried out periodically and reviewed by the Audit Committee to ensure that allpolicies and procedures are adhered to and all statutory obligations complied with.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS
No such orders have been received during the year 2020-21.
CORPORATE INSOLVENCY RESOLUTION PROCESS UNDER IBC 2016.
No any such process initiated under IBC 2016 during the year 2020-21.
POLICIES OF THE COMPANY
All the applicable policies of the company are available at the website of the companyi.e. www. samkrgpistonsandrings.com
DETAILS OF REMUNERATION PAID TO DIRECTORS AND EMPLOYEES : Section 197 (12) of theCompanies Act 2013.
The comparative analysis of remuneration paid to Directors & employees is notcirculated in accordance with the provisions of Section 197 (12) of the Companies Act2013 and are available with the company. Shareholders interested to have a copy of thesame may send an email to the Company Secretary or send letter with Folio Number / DEMAT
ID to the Registered Offi ce of the Company. Further the Remuneration paid to Directorsand Employees was based on the Remuneration Policy and is comparable with market standardsof the industry in which the company operates.
The Company has devised proper systems to ensure compliance with the provisions ofsecretarial standards issued by the Institute of Company Secretaries of India asapplicable to the Company and that such systems are adequate and operating effectively.
MATERIAL CHANGES AND COMMITMENTS
There are no Material changes and commitments in the business operations of the Companyfrom the financial year ended 31st March 2021 to the date of signing of theDirectors Report.
POLICY ON SEXUAL HARASSMENT
The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplacein accordance with the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.
During the Financial year ended 31st march 2021 the company has not received anyComplaints pertaining to Sexual Harassment.
Your Directors wish to place on record their appreciation for the cooperation andsupport of Bankers Customers Business Associates Shareholders dealers and supplierswho are enabling the Company to achieve its goals. The Directors also place on recordtheir appreciation made by the employees at all levels.
On behalf of the Board of Directors
S. D. M. RAO
Chairman &Managing Director
Date: 21st June 2021