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SNL Bearings Ltd.

BSE: 505827 Sector: Engineering
NSE: N.A. ISIN Code: INE568F01017
BSE 00:00 | 07 Jul 284.30 -0.45






NSE 05:30 | 01 Jan SNL Bearings Ltd
OPEN 288.95
52-Week high 324.90
52-Week low 218.00
P/E 11.62
Mkt Cap.(Rs cr) 103
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 288.95
CLOSE 284.75
52-Week high 324.90
52-Week low 218.00
P/E 11.62
Mkt Cap.(Rs cr) 103
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

SNL Bearings Ltd. (SNLBEARINGS) - Director Report

Company director report


The Members S

NL Bearings Limited

Your Directors have pleasure in presenting their Forty First Annual Report togetherwith Audited Financial Statements for the year ended March 31 2021.

1. Financial Results

Particulars 31st March 2021 31st March 2020
(Rs. lakhs) (Rs. lakhs)
Revenue from operations (Net) 3647 3414
Profit before tax 836 554
Provision for taxation:
Current tax (net) 209 138
Deferred tax 2 1
Tax pertaining to earlier years 6 -
Profit after taxation 619 415
Add: Balance brought forward 2113 2063
Add: Other Comprehensive Income for the year 8 (17)
2740 2461
Dividend - 288
Dividend distribution tax - 58
Impact of IND AS116 - 2
Profit & Loss Account 2740 2113
Total 2740 2461

2. Dividend

Based on the Company's performance your Board of Directors are pleased to recommend afinal dividend of Rs. 4.50/- per equity share (i.e. 45%) of face value of Rs. 10/- eachinvolving an outgo of Rs. 163 lakhs for the FY 2020-21 subject to approval of theshareholders at the ensuing Annual General Meeting.

Your Directors have proposed not to transfer any sums to the General Reserve.

3. State of Company's Affairs Operations & Future Outlook

FY 20-21 has been a difficult year for the Indian Manufacturing industry. The ferocityof the second wave of the pandemic is being now controlled with a plethora of vaccines andnew therapies that modern science and the pharmaceutical industry have delivered atunmatched speed. We shall overcome if we remain disciplined and focused on the strictcompliance with the behavior protocols prescribed for the pandemic.

Right from the early months of the pandemic when the worldwide lockdown disruptedeconomic activity across virtually all sectors your Company responded with speed andagility to work out an operating model suited for meeting the challenges. After a gradualopening up began in June 2020 the recovery was swift and much sharper than previouslyexpected boosted by strong pent-up demand followed by festive spending. Auto sales toowitnessed a steady growth trend. As we exit FY 20-21 we are better placed than we were atthe start despite a sharp fall in revenues in the first quarter progressivelystrengthening demand for our products helping clock full year revenues of Rs. 3647 lakhsin FY 2021 growing 7% over the previous year.

Profits after tax have grown 49% to Rs. 619 lakhs (previous year Rs. 415 lakhs) helpedby the higher volumes and the continuing efforts to restrict operating and administrativeexpenses.

Future Outlook

Recovery in global growth will largely be a function of how countries contain thepandemic and bounce back from its negative impact. Access to medical interventionseffectiveness of monetary policy support exposure to cross-country business are importantto drive the recovery. With the world's largest vaccination drive currently underway inIndia there is hope that the pandemic will be brought under control.

FY 2022 is likely to be a better year with growth coming back gradually. Severalindicators such as power demand rail freight e-way bills GST collection steelconsumption among others are trending positively and could lead economic recovery.Vehicle scrappage policy could also aid demand for new vehicles along with continuousinnovations and new launches. With the need for personal mobility growing the number offirst-time buyers is likely to be high aiding growth of compact cars. Favorable interestrates growth in rural areas and under penetration of PVs could further propel demand forvehicles.

4. Finance

Your Company has been rated 'CRISIL A1' for the Short-term Bank facility and theCompany's long-term facilities have been rated at 'CRISIL A/ Negative' (outlook revised to'Negative' from 'Stable' and Rating reaffirmed) as on May 22 2020. The Company continuesto focus on judicious management of its working capital. Receivables inventories andother working capital parameters are continuously monitored.

a. Public Deposits

During the year the Company has not accepted any deposits from the public/ Membersunder Section 73 of the Companies Act 2013 read with Companies (Acceptance of Deposits)Rules 2014. As on March 31 2021 there are no fixed deposits with the Company.

b. Particulars of Loans Guarantees or Investments

During the year under review the Company has not advanced any loans given guaranteesonly certain investments of temporary surplus funds in the Mutual Funds and Fixed Depositshave been done with Board's approval.

5. Directors and Key Managerial Personnel

In accordance with the provisions of Section 152 and the Articles of Association of theCompany Mr. Arvinder Singh Kohli (DIN.08135020) will retire by rotation at the ensuingAnnual General Meeting of the Company and being eligible has offered himself forre-appointment.

During the year under review Mr. Jayavardhan Dhar Diwan (Independent Director)resigned from the Board on February 8 2021 due to enhanced involvement in his otherprofessional commitments. He further confirmed that there is no other material reasonother the reason provided above.

Mr. Kaiyomarz Marfatia (DIN: 03449627) was appointed as an Additional Director in thecategory of Independent Director for a term of 5 (five) years w.e.f. May 31 2021 by theBoard of Directors at their meeting held on May 31 2021.

All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. Thecomposition of the Board duly meets the criteria stipulated in Section 152 of theCompanies Act 2013 and Regulation 17 of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.

Key Managerial Personnel

Pursuant to the provisions of Sections 2(51) and Section 203 of the Companies Act 2013read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014the following are the Key Managerial Personnel:

Mr. Krishna Kant Prasad Sinha - Chief Executive Officer
Mr. Ram Narayan Sahu - Chief Financial Officer
Mr. Kamlesh Sondigala - Company Secretary and Compliance Officer

Board Evaluation

For the FY 2020-21 the Board has carried out an annual performance evaluation of itsown and that of its Committees and individual directors using various performanceevaluation criteria on the forms circulated to and filled in by the directors. Thefeedback has been shared and discussed. The Independent Directors have met separately onMarch 10 2021 Mr. Jayavardhan Dhar Diwan was invited to join the meeting of IndependentDirector as he was on the Board for FY 2020-21 and they have conveyed to the Chairpersonof the Board their satisfaction with the working of the Board.

Familiarization Programme for Independent Directors

In order to familiarize the Independent Directors with the business the Company makesa presentation covering nature and scope of business nature of industry in which Companyoperates profitability and future scope. At meetings regular updates are given to theBoard by the Company's senior management in areas of operations industry and regulatorytrends competition and future outlook.

Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors senior management and to fixtheir remuneration. As part of its policy the Company strives to ensure that theRemuneration to Directors KMP's and Senior Management involves a balance between fixedand incentive pay reflecting short and long term performance objectives appropriate tothe working of the Company and its goals. The remuneration policy is posted on theCompany's website at

Details of remuneration paid to Directors KMP and the Independent Directors forms partof the Corporate Governance Report attached to this Report.


During the year 4 (four) Board meetings were convened and held (details in CorporateGovernance Report). In view of the COVID-19 pandemic the Ministry of Corporate Affairs(MCA) vide its notification dated March 24 2020 had provided a one-time relaxation byextending the gap between two board meetings from 120 days to 180 days. SimilarlySecurities Exchange Board of India (SEBI) vide its circular dated March 19 2020 hadprovided relaxation by extending the due date of holding board meeting for finalization offinancial results within 60 days from the end of the financial year by 1 month i.e. fromMay 30 2020 to June 30 2020. However the intervening gap between the Board meetingswere less than 120 (one hundred and twenty) days.

The date for the next meeting is fixed in advance at the previous meeting for bothBoard and Audit committee meetings.

6. Subsidiary Associate and Joint Venture Companies

As of March 31 2021 the Company does not have any Subsidiary Associate and JointVenture Companies.

7. Business Risk Management

The Company has in place an enterprise risk management framework to identify risks andminimize their adverse impact on business and strives to create transparency which in turnenhances the Company's competitive advantage. The Company has identified high share ofsales to the holding Company as a concern area associated with its operations and isworking towards progressively reducing this share. Another risk to operations arises fromthe expiry of leases in respect of certain portions of the Company's factory land andbuildings as the Lessor is under liquidation proceedings by the Official Liquidator in theDelhi High Court. The High Court order could affect operations. As part of its action planfor risk mitigation the Company has been successfully impleaded in the proceedings andhas filed its application seeking certain reliefs. The Company is hopeful that there willbe a favorable outcome to its offer to renew the leases for reasonable terms and atfavorable rates.

8. Conservation of energy technology absorption foreign exchange earnings and outgo

Information pursuant to Section 134(3)(m) of the Companies Act 2013 and Rule 8 ofCompanies (Accounts) Rules 2014 are given as below:

a. Measures taken for conservation of energy

During the year the Company has replaced approx. 500 nos. of 36W Tube light with 20WLED Tube light resulted in 16W of savings per tube which has resulted in energy saving of38400 KWH in six month amounting to Rs. 3 lakhs.

b. Technology absorption

With the objective of improving productivity as well as quality during the year theCompany has continued its efforts on improvements in process parameters and reduction incycle times. Improvements made on machines and many new products have been developed forprestigious export and domestic customers.

Upgradation of technology is a key focus area and the Company has initiated necessarymapping of its machines with this objective and management is taking all efforts towardsdeveloping low cost technological solutions.

c. Foreign exchange earnings & outgo for the year ended 31st March 2021

Foreign Exchange Earnings : Export of goods - Rs. 81 lakhs
Foreign Exchange Outgo : Raw materials & Components - Rs. 240 lakhs
Consumables Spares tools - Rs. 1 lakhs
Fixed Assets - Rs. 92 lakhs

9. Industrial Relations/ Vigil Mechanism and Whistle Blower Policy

During the year the Company maintained cordial relations with the workmen's unions.Regular training programmes are conducted for imparting understanding of bearing andengineering principles modern manufacturing practices and in attitudinal and behavioralaspects.

The Company has formulated and implemented the Whistle Blower Policy/ Vigil Mechanism.This has provided a mechanism for Directors and employees of the Company and other personsdealing with the Company to report to the Chairperson of the Audit Committee any instanceof unethical behaviour actual or suspected fraud or violation of the Company's code ofconduct. More details about this Policy are given in the Corporate Governance Reportwhich forms part of this Annual Report. The Whistle Blower Policy is available on theCompany's website viz. www.

Your Company hereby affirms that no complaints were received during the year.

10. Safety Healthy & Environment

The Company is committed to establishing and maintaining safe working environment thatpromotes good health and high performance of the employees and simultaneously takesmeasures to protect the environment. We also ensure that safety behaviour is welldemonstrated by our employees while working on the shop floor by using personal protectiveequipment's as required.

The Company's plant at Ranchi has been awarded internationally recognized externalcertification viz. ISO14001:2015 (for adherence to environmental processes) ISO 45001:2018 (for Health & Safety) and IATF:16949:2015 (quality management system).

Work force is trained at regular intervals in preventive aspects of safety andprevention of work related accidents. Besides creating general awareness among employeestowards environmental protection the management encourages initiatives which are targetedtowards conserving natural resources and improvements in resource efficiency across allprocesses.

In this continuous partial COVID-19 lockdown the employees have painstakingly adheredto the SOPs prescribed by the authorities to ensure social distancing norms for stayingsafe and healthy. Usage of prescribed Personal Protection Equipments (PPEs) by allemployees and frequent sanitization of the workplace/ employees by washing of hands isalso meticulously followed.

11. Corporate Social Responsibility

In line with the activities specified in schedule VII relating to the provisions ofsections 135 of the Companies Act 2013 your Company has been focusing on:

• Promotion of education (particularly for the underprivileged childrens and girlschild)

• Employment enhancing vocational skills

• Promoting social business projects

• Contribution to funds set up by Central/ State Government's for social economicdevelopment and relief.

41st Annual Report

During the year under review an aggregate amount of Rs. 20.14 lakhs has beencontributed to various organizations doing commendable work for the cause of promotingeducation and social business projects for the under privileged sections of society viz;

i. Sankalp (A pledge to change) - Running schools providing education to the poorsections of society in slums in and around Jamshedpur Dhanbad and other backward areas ofJharkhand.

ii. Ugam Foundation - Runs the Kasturba Gandhi Balika Vidyalaya (KGBV) scheme which waslaunched by the Government of India in August 2004 for setting up residential schools atupper primary level for girls belonging predominantly to the SC ST OBC and minorities indifficult areas. Over the next three years they expected to cover 10KGBV 150 teachersand 3900 girls students. At the Company's request the Foundation has successfullycompleted signing of the work order with the district education department and startedconducting programmes at KGBV Mandar located in Ranchi close to the SNL Plant.

iii. Indian Cancer Society - Indian Cancer Society is committed in extending holisticknowledge treatment and rehabilitation through its "Rise Against Cancer"movement. Their activities encompass the entire continuum of Cancer Care - cancerawareness screening for early detection financial help for treatment support groupsrehabilitation of cancer survivors registry research & education.

iv. The Company has also contributed towards COVID-19 related activities vizDistribution of food packets masks and sanitizer in Ranchi.

The Annual Report on CSR activities in pursuance of the Companies (Corporate SocialResponsibility Policy) Rules 2014 is annexed herewith as Annexure I.

12. Corporate Governance

Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 aManagement Discussion and Analysis report Corporate Governance Report and Auditors'Certificate regarding compliance of conditions of Corporate Governance are made part ofthe Annual Report. Details of Board meetings held during the year under review and thecomposition of the various committees are included therein.

The Code of Conduct for Directors and Senior Management personnel of the Company asapproved by the Board has been affirmed on an annual basis by all the Directors CompanySecretary Chief Financial Officer and the Chief Executive Officer of the Company. AllIndependent Directors have also submitted a certificate confirming that they meet thecriteria of independence as provided under section 149 of the Companies Act2013.

The relevant certification on the various matters specified under Regulation 17(8) ofSEBI (LODR) Regulations 2015 has been done by CEO and CFO.

During the year under review the Company has complied with all the applicableSecretarial Standards.

All pecuniary relationships or transactions of the Non-Executive Directors vis-a-visthe Company along with criteria for such payments and disclosures on remuneration ofDirectors along with their shareholding are disclosed in Form MGT-9 which forms a part ofthis Report.

There are no relationships between the Directors inter-se.

13. Extract of Annual Return

The details forming part of the extract of the Annual Return (MGT-9) as required underthe Companies Act 2013 is given in Annexure II.

14. Directors' Responsibility Statement

Pursuant to the requirements under Section 134(3)(c) of the Companies Act 2013 yourDirectors state that:

i. in the preparation of annual accounts the applicable Accounting Standards have beenfollowed along with proper explanations relating to material departures if any have beenfurnished;

ii. the accounting policies have been selected and these have been applied consistentlyand judgments and estimates made thereon are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at 31st March 2021 and of theprofit of the Company for that period;

iii. proper and sufficient care for the maintenance of adequate accounting records hasbeen taken in accordance with the provisions of the Companies Act 2013 for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the Annual Accounts have been prepared on a going concern basis.

v. internal financial controls have been laid down and being followed by the Companyand that such financial controls are adequate and are operating effectively.

vi. proper systems to ensure compliance with the provisions of all applicable laws havebeen devised and that such systems are adequate and operating effectively.

15. Related Party Transactions (RPT)

All RPT that were entered into during the financial year were on an arm's length basisand were in the ordinary course of business. The Company had obtained approval of themembers of the Company for Material RPT's entered with its holding Company M/s. NRBBearings Limited at 40th Annual General Meeting held for the FY 2020-21. There were noother materially significant RPT by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons.

All RPT are placed before the Audit Committee as also the board for approval. Priorapproval of the Audit Committee is obtained on periodic basis for transactions which areforeseen and repetitive in nature. The compliance of the transfer pricing norms inrelation to such transactions is certified by the tax advisors.

The RPT policy as approved by the Board is uploaded on the Company's website viz. The particulars of contracts or arrangements with related parties referredto in Section 188 (1) of the Companies Act 2013 in Form AOC-2 pursuant to Section 134 (3)(h) of the Companies Ac 2013 is attached as Annexure-III to this Report.

16. Internal Financial Control Systems and Adequacy

There are adequate internal financial controls in place with reference to the financialstatements. The upgraded ERP system provides reports to validate the required internalfinance controls. Further improvements by way of biometric attendance and linked leaverecords and payroll systems have been implemented with existing system. The InternalAuditors have been regularly reviewing the same and their recommendations forimprovements have been included in the ERP upgrade implementation. During the year underreview these controls were evaluated and no significant weakness was identified either inthe design or operation of the controls. This formalized system of internal controlfacilitates effective compliance of Section 138 of the Companies Act 2013 and the ListingRegulations.

Your Company's Statutory Auditors have in their report confirmed the adequacy of theinternal control procedures.

17. Particulars of Employees

In terms of the provisions of Section 197(12) of the Companies Act 2013 there are noemployees of the Company drawing remuneration in excess of the limits set out in the saidprovision.

The disclosure pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed to this report at AnnexureIV.

18. Auditors Statutory Auditor

Appointment of M/s. Walker Chandiok & Co. LLP Chartered Accountants as statutoryauditors were approved at the 38th Annual General Meeting held on August 1 2018 for aterm of five (5) years upto March 31 2023.

Cost Auditor

Pursuant to the provisions of Section 148 of the Companies Act 2013 and the Companies(Cost Records and Audit) Rules 2014 the products manufactured by the Company and based onthe criteria laid down under the aforesaid rules Cost Audit is not applicable to yourCompany. However from the FY 2018-19 maintenance of prescribed Cost records isapplicable to your Company and accordingly such accounts and records are made andmaintained by the Company.

Secretarial Auditor

Pursuant to the provision of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed Mr. Upendra Shukla Practicing Company Secretary to carry out Secretarial Auditof the Company for the Financial Year 2020-21. The report of the Secretarial Auditor isannexed to this report as Annexure V.

Explanation or Comments on disqualifications reservations adverse remarks ordisclaimers in the auditor's reports

There have been no disqualifications reservations adversere marks or disclaimers inthe auditor's reports. However the Statutory Auditors and the Secretarial Auditors intheir reports have observed that subsequent to resignation of Mr. Jayavardhan Dhar Diwan(Independent Director) with effect from February 8 2021 the total strength of the Boardwas reduced to five as against the prescribed limit of six Directors under Regulation17(1)(c) of SEBI (LODR) Regulations 2015.

The Company has complied with Regulation 17(1)(c) of the SEBI (LODR) Regulations 2015by appointing Mr. Kaiyomarz Minoo Marfatia (DIN: 03449627) as an Additional Director inthe Category of Non-Executive & Independent Director w.e.f. May 31 2021 within thetime prescribed under Regulation 25(6) of SEBI (LODR) Regulations 2015.

19. Significant and Material Orders passed by the Regulators or the Courts or theTribunals

There are no orders passed by the Regulators or Courts or Tribunals impacting the goingconcern status of the Company's operation.

20. Change in nature of business

During the year under review there was no change in the nature of the business carriedon by the Company.

21. Disclosure under Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013

In accordance with the provisions of the Sexual Harassment of Women at the Workplace(Prevention Prohibition and Redressal) Act 2013 the Company is not required to setupInternal Complaints Committees (ICC) to redress complaints as the Company has no womenemployee and during the year under review there were no complaints received by theCompany.

22. Material changes and commitments if any affecting the financial position of theCompany

There are no material changes and commitments other than the impact of the lockdownrestrictions arising from COVID-19 pandemic affecting the financial position of theCompany which have occurred between the close of the financial year on March 31 2021 towhich the financial statements relate and the date of this Report.

23. Acknowledgements

The Board wishes to acknowledge and express their gratitude for the whole heartedsupport and cooperation extended by the shareholders NRB group Company's bankerscustomers suppliers and all employees of the Company for their efforts in a difficultyear.

For and on behalf of the Board of Directors SNL Bearings Limited
Harshbeena Zaveri
Place : Mumbai Chairperson
Date : May 31 2021