Savita Oil Technologies Ltd.
|BSE: 524667||Sector: Industrials|
|NSE: SOTL||ISIN Code: INE035D01012|
|BSE 15:40 | 27 Jul||1490.00||
|NSE 15:30 | 27 Jul||1478.65||
|Mkt Cap.(Rs cr)||2,059|
|Mkt Cap.(Rs cr)||2059.18|
Savita Oil Technologies Ltd. (SOTL) - Director Report
Company director report
Your directors have pleasure in presenting the fifty-ninth annualreport together with the audited accounts for the year ended 31st march 2020.
1. Financial results
2. Share capital
Post the completion of buyback of 251000 (two lac fifty-one thousand)fully paid equity shares of your company of face value of '10/- only (rupees ten only)representing upto 1.75% of the total number of equity shares from all the equityshareholders/beneficial owners of your company on a proportionate basis through the tenderoffer using stock exchange mechanism at a price of '1605/- (rupees one thousand sixhundred and five only) (including premium of rs 1595/-) per equity share for an aggregatemaximum amount of upto rs 402855000/- (rupees forty crore twenty-eight lakh fifty-fivethousand only) on 6th august 2019 the paid-up equity share capital of yourcompany stands at rs 140710830/- as on date.
Your directors at the board meeting held on 7th march 2020had recommended an interim dividend @200% (' 20 per equity share of rs 10/- each) asagainst 25% final dividend for the previous year on the paid up equity share capital ofrs 1407 lac resulting in an outgo of rs 3393 lac inclusive of dividend tax.
Your directors at the board meeting held on 10th july 2020decided to consider the interim dividend paid in march 2020 as the interim-cum-finaldividend for the fy 2019-2020.
Your directors recommend that the above interim- cum-final dividend beapproved by the members at the ensuing annual general meeting of your company.
The reserves of your company stood increased to rs 855 crore at the endof the year under review as against rs 837 crore for the previous year.
During the year under review your company achieved sales volume at339279 kls/mts as against 346256 kls/mts achieved during 20182019. Your company'ssales turnover during the year 2019-2020 was at Rs 202911 lac against rs 224583 lac inthe year 2018-2019. In line with the lower sales turnover your company's net profit waslower at rs 9564 lac as against Rs 11427 lac during the previous year.
During the year under review there was a significant slowdown in thegdp growth rate of the indian economy and this was particularly evident in the automotivesector and the power sector both of which impacted the growth in volumes of yourcompany's products. Even amidst these challenges your company was well positioned tosurpass the sales volumes of the year before.
Unfortunately towards the end of the year the outbreak of covid-19pandemic adversely affected the performance of your company in terms of sales and alsoprofits during the year under review. Since 21st march 2020 due to anationwide lockdown declared by the government the dispatches of your company almost cameto a standstill. Your company has recommenced operations since then in line with thevarious guidelines and sops prescribed from time to time by both - central and stategovernments following prescribed measures in terms of health and safety of the workforceand general work areas.
With the covid-19 pandemic continuing to inflict its adverse effects onthe economy in general your company has been trying its best to operate within thesechallenging situations with utmost caution and conservatism. The impact of covid-19 onglobal commodities like crude oil and continuing depreciation of the rupee during the peakof the pandemic will certainly have an adverse effect on your company's performancehowever it is expected that with the stabilisation of covid-19 situation gradual liftingof lockdowns in the months to come and the economy getting back to normal your companyshall show significant improvement in terms of sales and profitability and shall strive tomake up for ground lost during the pandemic.
During the financial year 2019-2020 your company's wind power plantssituated in the states of maharashtra karnataka and tamil nadu generated a total of 87.70mu as against 89.11 mu generated in the previous year. During the year under review yourcompany did not add any new projects to its wind portfolio.
6. Public deposits
Your company has not accepted any deposits from the public or itsemployees during the year under review.
7. Particulars of loans guarantees or investments
Details of loans guarantees and investments covered under theprovisions of section 186 of the companies act 2013 are given in the notes to thefinancial statements.
8. Corporate governance
Corporate governance report along with a certificate from thesecretarial auditors of your company regarding compliance of the conditions of corporategovernance pursuant to requirements as stipulated by securities and exchange board ofindia (listing obligations and disclosure requirements) regulations 2015 is annexedhereto and forms part of this report.
As per provisions of section 152 of the companies act 2013 mr.Siddharth g. Mehra (din: 06454215) director of the company retires by rotation at theensuing annual general meeting of your company and being eligible offers himself forre-appointment.
Board of directors of your company in its meeting held on 18thaugust 2020 re-appointed mr. Suhas m. Dixit (din: 02359138) as the whole-time directorw.e.f. 1st october 2020 upto 30th september 2021 as recommended bynomination & remuneration committee subject to your approval at the ensuing annualgeneral meeting.
Profiles of mr. Siddharth g. Mehra and mr. Suhas m. Dixit have beendetailed below explanatory statement annexed to the notice of the ensuing annual generalmeeting. Your directors recommend their re-appointments as the whole-time director of yourcompany.
Your company has received declarations from all the independentdirectors of your company confirming that they meet with the criteria of independence asprescribed under the act and sebi (listing obligations and disclosure requirements)regulations 2015.
10. Key managerial personnel
During the year under review mr. Gautam n. Mehra managing director ofyour company mr. C.v. Alexandar whole-time director (upto 30th april 2019)mr. Suhas m. Dixit chief financial officer & director mr. Siddharth g. Mehrawhole-time director and mr. Uday c. Rege company secretary and executive vp - legalcontinued to be the key managerial personnel of your company.
Remuneration and other details of the said key managerial personnel forthe financial year ended 31st march 2020 are mentioned in the extract of theannual return which is attached to the board's report.
11. Board committees
The board of directors of your company at its meeting held on 3rdfebruary 2020 re-constituted the nomination and remuneration committee in compliancewith the provisions of the companies act 2013 and sebi (listing obligations anddisclosure requirements) regulations 2015.
All decisions pertaining to the constitution of committees appointmentof members and fixing of terms of reference/role of the committees are taken by the boardof directors of your company.
Details of the role and composition of the committees of your companyincluding the number of meetings held during the financial year and attendance atmeetings are provided in the corporate governance section of the annual report.
12. Number of meetings
The board of directors of your company met 5 times during fy 2019-2020.The board meetings were held on 29th may 2019 12th august 201931st october 2019 3rd february 2020 and 7th march2020. The maximum time gap between any two consecutive meetings did not exceed one hundredand twenty days.
- audit committee met four times on 29th may 2019 12thaugust 2019 31st october 2019 and 3rd february 2020 during theyear 2019-2020.
- stakeholders' relationship committee met four times on 29thmay 2019 12th august 2019 31st october 2019 and 3rdfebruary 2020 during the year 2019-2020.
- nomination and remuneration committee met two times on 29thmay 2019 and 3rd february 2020 during the year 2019-2020.
- risk management committee met two times on 29th may 2019and 31st october 2019 during the year 2019-2020.
- csr committee met four times on 29th may 2019 12thaugust 2019 31st october 2019 and 3rd february 2020 during theyear 2019-2020.
13. Directors' responsibility statement
In accordance with the provisions of section 134 (5) of the companiesact 2013 your directors confirm that:
B) the selected accounting policies were applied consistently and thedirectors made judgments and estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of your company as at 31st march2020 and of statement of profit and loss of your company for the year ended on that date.
C) proper and sufficient care has been taken for the maintenance ofadequate accounting records in accordance with the provisions of the companies act 2013for safeguarding the assets of your company and for preventing and detecting fraud andother irregularities.
D) the annual accounts have been prepared on a going concern basis.
E) the internal financial controls have been laid down to be followedby your company and such controls are adequate and are operating effectively.
F) proper systems to ensure compliance with the provisions of allapplicable laws have been devised and such systems are adequate and are operatingeffectively.
14. Performance evaluation
Pursuant to the provisions of section 134 (3) (p) 149 (8) and scheduleIV of the companies act 2013 and sebi (listing obligations and disclosure requirements)regulations 2015 annual performance evaluation of the directors as well as of the auditcommittee nomination and remuneration committee stakeholders' relationship committee andthe performance evaluation of the independent directors could not be undertaken by yourcompany for the fy 2019-2020 due to covid-19 inflicted lockdown. Similarly theperformance evaluation of the chairman and non-independent directors for the fy 2019-2020also could not be carried out separately by the independent directors due to lockdown.
15. Independent directors' meeting
During the year under review the independent directors of your companycould not meet due to lockdown interalia to discuss:
I) evaluation of performance of non-independent directors and the boardof directors of your company as a whole.
II) evaluation of performance of the chairman of your company takinginto views of executive and non-executive directors.
III) evaluation of the quality content and timelines of flow ofinformation between the management and the board that is necessary for the board toeffectively and reasonably perform its duties.
16. Managerial remuneration
The information required under rule 5 (1) of the companies (appointmentand remuneration of managerial personnel) rules 2014 is provided as a separate annexure.The information as required under rule 5 (2) of the companies (appointment andremuneration of managerial personnel) rules 2014 will be provided upon request by anymember of your company. In terms of section 136 (1) of the companies act 2013 the reportand the accounts are being sent to members excluding the aforesaid annexure. Any memberinterested in obtaining copy of the same may write to the company secretary at theregistered office of your company.
17. Nomination and remuneration policy
The nomination and remuneration policy
Recommended by the nomination and remuneration committee and approvedby the board of directors of your company in its meeting held on 29th may 2014continues to be adopted by your company. The remuneration policy of your company isattached to this report as a separate annexure.
18. Csr policy
The corporate social responsibility policy
Recommended by the csr committee and approved by the board of directorsof your company in its meeting held on 29th may 2014 continues to be adoptedby your company. The same is available on the website of your company i.e. Www.Savita.com.
The disclosure relating to the amount spent on corporate socialresponsibility activities for the financial year ended 31st march 2020 isattached to this report as a separate annexure.
19. Listing and other regulatory orders against your company if any
Your company's shares continue to be listed on bse limited andnational stock exchange of india limited. The listing fees to these two stock exchangesfor the year 2020-2021 have been paid by your company on time.
There were no significant or material orders passed by any of theregulators or courts or tribunals impacting the going concern status and your company'soperations in future.
20. Transfer to investor education and protection fund
During the year your company has transferred rs 12.54 lac towardsunclaimed dividend as against rs 16.27 lac towards unclaimed dividend in the previous yearto the investor education and protection fund which amount was due and payable for theyear 2011-2012 and remained unclaimed and unpaid for a period of 7 years as provided insection 125 of the companies act 2013.
Your company has intimated to the shareholders who had not claimeddividends for the past 7 years to claim the dividends forthwith failing which their shareswould stand transferred to the iepf authority after 5th october 2020.
21. Key financial ratios
Key financial ratios for the financial year ended 31stmarch 2020 are provided in the management discussion and analysis report which isannexed hereto and forms a part of the board's report.
22. Statutory auditors
The members of your company at the 56th annual generalmeeting held on 29th september 2017 had approved the appointment of g. D. Apte& co. chartered accountants mumbai (registration no.100515w) as the statutoryauditors of your company to hold office from the conclusion of that agm until theconclusion of the 61st annual general meeting.
23. Auditors' report
The auditors' report to the members on the accounts of yourcompany for the financial year ended 31st march 2020 is attached to thisreport and does not contain any qualification reservation or adverse remark.
24. Secretarial audit report
Secretarial audit for the year 2019-2020 was conducted by mp &associates company secretaries in practice in accordance with the provisions of section
204 of the companies act 2013. The secretarial audit report isattached as a separate annexure to this report.
Your directors wish to inform you that your company spent lower amounton csr activities than the required one during the year under review since suitableprojects were being identified and studied for implementation. Your company could not filedata with respect to transfer of unclaimed and unpaid dividend with the investor educationand protection fund authority for the financial year 2011-2012 purely due to technicalglitches faced on the iepf interface.
25. Cost audit
In compliance with the provisions of section 148 of the companies act2013 the board of directors of your company at its meeting held on 10th july2020 has appointed kale & associates cost accountants as cost auditors of yourcompany for the year 2020-2021. In terms of the provisions of section 148(3) of thecompanies act 2013 read with rule 14(a)(II) of the companies (audit and auditors) rules2014 the remuneration of the cost auditors has to be ratified by the members.Accordingly necessary resolution is proposed at the ensuing annual general meeting forratification of the remuneration payable to the cost auditors for the year 2020-2021.
26. Risk management
In accordance with the provisions of clause 49 of the sebi (listingobligations and disclosure requirements) regulations 2015 your company has riskmanagement committee in operation to oversee the risk management of your company in linewith your company's risk framework and a detailed policy to cover risk assessmentsidentification of various significant risks and mitigation plans to address the identifiedrisks. Your company's risk management policy continues to be displayed on the website www.Savita.com of your company.
27. Internal control systems and their adequacy
Robust internal control systems are required in any organisation foreffecting operational efficiencies and to bring in cost savings therein. Your company'sinternal control systems are in line with size scale and complexity of its operations.The audit committee supervises the scope and authority of the internal audit function inyour company as a continuing exercise. As is mandatorily required your company
Also hires services of external agency for periodically carrying outinternal audit in areas identified by the audit committee from time to time. Such internalaudit reports are considered at each of the audit committee meetings where significantaudit observations are discussed in detail and action plans narrating corrective actionsare then suggested to be taken thereon by the concerned departments. The actions taken arereviewed by the audit committee at their subsequent meetings.
28. Vigil mechanism
Your company has a vigil mechanism policy to deal with instances offraud and mismanagement if any. The whistle blower policy framed for the purpose isuploaded on the website www.Savita.com of your company.
29. Related party transactions
The audit committee scrutinises and approves all related partytransactions attracting compliance under section 188 and/or regulation 23 of the sebi(listing obligations and disclosure requirements) regulations 2015 before placing themfor board's approval. Prior omnibus approval of the audit committee is also sought fortransactions which are of a foreseen and repetitive nature.
The policy on materiality of related party transactions and dealingwith related party transactions as approved by the board of directors of your company isuploaded on the website www.Savita.com of your company.
The disclosures on related party transactions too are made in thefinancial statements of your company from time to time.
30. Extract of annual return
The details forming part of the extract of annual return in prescribedform mgt 9 is annexed as a separate annexure forming part of this report.
31. Sexual harassment grievances
During the year under review there were no grievances reported underthe sexual harassment of women at workplace (prevention prohibition and redressal) act2013.
32. Industrial relations
The industrial relations continued to be generally peaceful and cordialduring the year.
33. Conservation of energy technology absorption and foreign exchangeearnings and outgo
The information relating to the conservation of energy technologyabsorption and foreign exchange earnings and outgo as required to be disclosed under thecompanies (accounts) rules 2014 is given as an annexure forming part of this report.
Your directors wish to record their sincere appreciation for theencouragement support and co-operation received from all stakeholders of your
Company including members customers suppliers governmentauthorities banks and all other associates and also wish to thank them for the trustreposed in the management. Your directors are also grateful to all the employees for theircommitment and contribution to the welfare of your company.