Your Directors are pleased and privileged to present 33rd Annual Report andthe Audited Accounts of the Company for the year ended March 31 2019.
| ||2018-19 ||2017-18 |
|Gross total income from operations ||35616.53 ||32397.15 |
|Other Income ||198.73 ||219.12 |
|Profit before Interest Depreciation and Tax (PBIDT) ||4567.42 ||4373.71 |
|Interest ||143.75 ||140.23 |
|Profit before depreciation and Tax (PBDT) ||4423.67 ||4233.48 |
|* Depreciation ||1205.97 ||1305.18 |
|Profit before Exceptional Item ||3217.70 ||2965.80 |
|C S R ||42.50 ||37.50 |
|Extraordinary Item ||0 ||0 |
|Profit after CSR ||3175.20 ||2928.30 |
|Provision for Taxation || || |
|i) Current Year ||1026.61 ||866.25 |
|ii) Deferred Taxation ||45.00 ||46.59 |
|Net Profit before Extraordinary Item ||2103.59 ||2015.46 |
|Extraordinary Item || ||0 |
|Profit after Extraordinary Item ||2103.59 ||2015.46 |
Note: Figures have been re-grouped wherever necessary to confirm to current periodclassification.
Your Directors recommended dividend of Rs.5/- per equity share (50%) of face value ofRs.10/- each for the year ended March 31 2019.
The company's financial discipline and prudence is reflected by becoming a debt freecompany for the last few years and credit ratings ascribed by CRISIL
Long term rating : CRISIL A-/Stable (Reaffirmed)
Short term Rating : CRISIL A2+ (Reaffirmed)
Review of business operations:
In the year 2018-19 the Global Automotive Industry was passing through one of the mostchallenging times which turned out to be a double edged affect for the Domestic Industry.The Domestic Industry performed very well and achieved the targets for the first twoquarters and in the third quarter started slowing down and the last quarter drop down tothe rock bottom because of various factors and also general elections. However ourCompany achieved all time good financial results.
The Company posted remarkable performance growing 9.94% increase in the gross turnoverof Rs.35616.53 lakhs during year 2018-19 as against Rs.32397.76 Lakhs in the previous year201718 and Net turnover increase of 18.05% of Rs.28956.06 Lakhs during the year 2018-19 ascompared to Rs.24527.71 Lakhs for the previous year 2017-18.
The company R&D expenditure is Rs. 61.32 Lakhs i.e. 0.25% of Net sales during theyear to catch up with up-gradation of technology and to meet OEM's ever demanding qualityand new developments requirement to improve life cycle of their product meeting BS-VInorms of environmental standards for Auto components.
The operations of the Company on the whole have 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. To meet with the challenges of these BS-VI norms and having achievedBS-IV norms in the years 2015-16 2016-17 and 2017-18 during the second and third quarterof 2018 have been many challenges and settling down for an improved performance postgeneral elections.
As the rural economy is growing the demand for two wheelers and three wheelerscomplying BS-IV norms may give encouraging results and hopeful of maintaining growth thisyear also. Company is now focusing customer preferences and distributions channels andalways exploring new avenues in the export market which will give encouraging results.
Earnings Before Depreciation Interest and Tax (PBDIT) at Rs.4524.92 lakhs as againstprevious year of Rs.4373.71 Lakhs. The Profit Before Tax was at Rs. 3175.20 lakhs ascompared to Rs. 2928.30 lakhs in 2017-18 an increase of 8.43%
In line with motto of Reshaping our business for tomorrow' Samkrg is serving thegrowing needs of our Business Accounts and Individual Customers of export and domestic andalso OEM Customer segments by offering cost effective prices and different Products andServices. 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 customercentric services.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 with respect to the Directors'Responsibility Statement the Board of Directors of the Company hereby confirms:
In the participation of Annual Accounts the applicable Indian accountingstandards have been followed and that there have been no material departures.
The Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2018 andthe profit loss account to the Company for that period.
The Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities.
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 theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
The Company's Internal Auditors have conducted periodic audit to providereasonable assurance that the Company's 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 ||- Managing Director |
|2. Mr. Pinninti Raghu Prakash Swamy ||- Director |
|3. Mr. K Chaitanya Abhishek ||- Director |
RISK MANAGEMENT POLICY
The company has taken all the steps to mitigate the following risks:
Raw material prices: Ours is a continuous high volume manufacturing industry. Ourprofitability will depend on change in the price in raw materials and input costs.
Foreign currency Risks: Exchange rate fluctuations may sometimes effect. Adequate stepswere taken.
Competition and Price Pressure: The Company is facing stiff competition in the segmentsof OEMs and aftermarket as well as price pressure from the OEMs which playing major rollon the profitability 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 social responsibility as per Rule 8 of Companies (Corporate SocialResponsibility) Rules 2014 is prepared 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 Mr. S. MadhavaRao.
Brief description of terms of reference:
Identifying persons who are qualified to become directors and who may beappointed in senior management in accordance with the criteria laid down and recommend tothe Board for their appointment and removal;
Carry on the evaluation of every director's performance;
Formulation of the criteria for determining qualifications positive attributesand independence of a director;
Recommend to the Board a policy relating to the remuneration of the directorskey managerial 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 ti me 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 qualified 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 Company's size and financial positions andtrends 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 Company's operations.
5. To retain motivate and promote talent and to ensure long term sustainability oftalented managerial persons and create competitive advantage.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS UNDER SECTION 186:
The company has neither issued any Loans Guarantees nor made any investments duringthe Financial year 2018-19.
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. 631.08 lakhs to the general reservefor the financial year ended 31st March 2019.
LISTING OF EQUITY SHARES
The Company's equity shares are listed on BSE Ltd. Feroz Jeejeebai Towers DalalStreet Mumbai 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
Shri S Karunakar Whole Time Director who is liable to retire by rotation at thisAnnual General Meeting and being eligible offers himself for re-appointment.
Shri V Chakrapani has ceased to be Director w.e.f. 09th September 2018.
Shri K Chaitanya Abhishek has been appointed w.e.f. 29th October 2018.
Shri Pinninti Raghu Prakash Swamy has been appointed w.e.f. 20th April2019.
Key Managerial Persons
Ms. Ratnakumari Nama has resigned from the post of Chief Financial Officer w.e.f. 15thMay 2019.
Shri Dinker Mishra having ICSI Membership No. ACS 48511 has been appointed as CompanySecretary & Compliance Officer w.e.f. 20th April 2019.
Shri Kota Ramesh has been appointed as Chief Financial Officer w.e.f. 16th May 2019.
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 as not applicable.
At the Annual General Meeting held on 25th September 2017 M/s. SridharaChary V & Co. Chartered Accountants were appointed as statutory Auditors of theCompany to hold office till the conclusion of the Annual General Meeting to be held in thecalendar year 2022.
There are no qualifications reservations or adverse remarks made by M/s Sridhara CharyV & Co. chartered Accountants Hyderabad Chartered Accountants (ICAI Reg. No.011478S)Statutory Auditors in their report for the Financial Year ended March 31st 2019..
Composition of Audit Committee included in Corporate Governance report.
A separate report on Corporate Governance is annexed as part of the Annual Report alongwith the Auditor's Certificate 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 Directorshave 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 2019.
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 qualifications 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 Company's nature of business during the financial year endingMarch 31st 2019.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The company has well defined 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.
MATERIAL CHANGES AND COMMITMENTS
There are no Material changes and commitments in the business operations of the Companyfrom the financial year ended 31st March 2019 to the date of signing of the Director'sReport.
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 2019 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: 29th May 2019