Your directors have pleasure in presenting the 27th Annual Reporttogether with audited accounts for the year ended 31st March 2021. The summarisedfinancial results of the Company are presented hereunder:
|FINANCIAL RESULTS: || || |
| || ||(Rs. in cr.) |
|Particulars ||Year ended March 31 2021 ||Year ended March 31 2020 |
|Revenue from ||14.13 ||59.48 |
|Portfolio Companies || || |
|Operating Revenue ||23.56 ||33.00 |
|Other Income ||2.07 ||1.87 |
|Total Revenue ||39.76 ||94.35 |
|Less: Total Expenses ||22.11 ||29.24 |
|Profit before Tax ||17.65 ||65.12 |
|Profit after Tax ||14.55 ||61.39 |
|Consolidated PAT ||73.88 ||78.13 |
Your directors are pleased to recommend a dividend of `0.50/- per share(10% on the face value of `5/-) on the enhanced paid-up capital of `111.05 cr. pursuantto the rights issue. The Dividend Distribution Policy formulated in accordance with theprovisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is attached as part of this report vide Annexure
MANAGEMENT DISCUSSION AND ANALYSIS INDIAN ECONOMY
The COVID-19 pandemic has been the defining event of the last year anda half with a devastating human cost both in terms of lives lost and livelihoodsaffected. The first wave of COVID-19 infections in India peaking at almost 100000infections a day spanned the entire fiscal year resulting in a GDP contraction of almost8% compared to the previous year.
However the sizeable stimulus measures in the western economiesresulted in a steady money flow into India which stabilised the rupee. Due to thesubstantial loss of revenue due to COVID-19 related restrictions the Government hastargeted a deficit of 9.5% of GDP. However pickup in tax revenue during the last quarteris likely to bring down this deficit closer to just under 8%. The ongoing second wave willexert pressure on this again. In the midst of this Indian equity markets witnessedsignificant momentum largely driven by global developments and the abundance of liquidityin the financial system. The Sensex recorded an annual return of 68%.
The automotive sector was already witnessing bouts of weakness goinginto financial year 2020-21. The onset of the COVID-19 pandemic only exacerbated thesituation. The commercial vehicles (CV) segment was the worst affected given its closelinkages to the economy's growth momentum. Fresh restrictions on activity in the wake ofthe second wave have imposed a further strain on the CV segment. The financial year2020-21 was however a strong year for tractors. Three consecutive years of good cropsincreased government spending in rural India strong agricultural output and elevatedfarmer sentiment resulted in a 27% growth in tractor volumes over the previous year. Theincreased need for personal mobility resulted in a lesser impact on passenger vehicle (PV)volumes that contracted by only 2% year on year. Vehicles driven by infrastructure end-use- tippers and material handling and construction equipment - were also relatively lessimpacted aided by Government spending on infrastructure projects. The emergence of thesecond wave of the pandemic is likely to put a strain on the finances of both the Centraland State Governments which could constrain their budgetary allocations forinfrastructure and other developmental projects. As a consequence a revival in thefortunes of the Commercial vehicle sector appears unlikely in the near term.
Your company generates a significant portion of its income fromdividend flows from the portfolio companies that are engaged in the automotive sector.
The worldwide disruption caused by the COVID-19 pandemic and theconsequent lockdown imposed almost till end-November 2020 have considerably impacted thebusiness operations of our associate companies including their subsidiaries which inturn have impacted the financial results of the Company. Even as the automotive sectorwas beginning to show some signs of recovery from the third quarter of financial year2020-21 the second wave of the pandemic from March 2021 which has been far more severein India with infection rates in excess of 400000 has forced another phase of lockdownsin various states across the country.
While many countries around the world are witnessing the end of their"third wave" of COVID-19 infections several others are witnessing risinginfections implying that it would take longer for them to ease COVID-relatedrestrictions. Therefore uncertainty remains over the global economy as well as the Indianeconomy and it is unclear what FY22 holds in store for us. Hence while we remainpositive on the automotive sector in the medium-term significant uncertainty exists aboutthe sector's performance in 2021-22.
EXEMPTED CORE INVESTMENT COMPANY
As at the date of the audited balance sheet relating to the previousyear i.e. 31st March 2020 the overall investments of the Company in Group Companies hadfallen below the threshold limit specified in the Core Investment Companies (Reserve Bank)Directions 2016 (the Directions) i.e. 90% of the net assets primarily due to adepletion in the valuation of investments computed as per IND AS 113 as a result of whichyour Company had ceased to be categorised as an exempted Core Investment Company.Accordingly during the year an application was submitted to the Reserve Bank of India(RBI) for registration as a non-deposit taking Non-Banking Finance Company("NBFC-ND") since the Company fulfilled the principal businesscriteria' applicable to NBFCs. However the application was returned by RBI duringFebruary 2021 for the reason that the promoter of your Company i.e. Sundaram FinanceLimited is a Type-II-NBFC which also wholly owns another NBFC (HFC) viz. Sundaram HomeFinance Limited. In reply the Company had sought a clarification regarding its status andrequested RBI to re-consider its decision for which RBI's response is awaited.
Meanwhile as at the date of the audited balance sheet for thefinancial year ended 31st March 2021 the Company has fulfilled the requisite criteria andis categorised as an exempted CIC under the Directions.
OPERATING AND FINANCIAL PERFORMANCE
Your Company earned a revenue of `39.76 cr. during the financial year2020-21 as against `94.35 cr. in the previous year. The profit after tax for the year was`14.55 cr. as against `61.39 cr. in the previous year. The company's net-worth stoodat `1425.13 cr. as on 31.03.2021.
The significant changes in key financial ratios of the Company for F.Y.2020-21 as compared to F.Y. 2019-20 are as follows:
|Ratios ||March 2021 ||March 2020 ||Variance ||Reason for Change |
|Current Ratio ||25.71 ||63.82 ||(58%) ||Due to reduction in closing balance of Mutual Fund investments. |
|Operating Profit Margin (%) ||41.39 ||68.1 ||(39%) ||Due to reduction in Net Profit and Total revenue during FY 2020-21 |
|Net Profit ||36.59 ||65.1 ||(43%) || |
|Margin (%) || || || || |
|ROCE (%) ||1.1 ||5.1 ||(78%) || |
|ROE (%) ||1.02 ||4.9 ||(79%) || |
The consolidated profit after tax and net worth for the year stood at`73.88 cr. and `2195.02 cr. respectively.
The BPO business of the Company comprises the following:
|Type of Business ||Turnover (Rs. in cr.) |
|Shared services business managed by the Company ||18.18 |
|Sundaram Business Services Limited - for managing outsourced business of domestic and overseas clients (Wholly- owned Subsidiary) ||30.84 |
|Total ||49.02 |
Shared Services Business
The shared services business of the Company encompasses servicesprovided to Sundaram Finance Limited and its group and associate companies on anarm's length basis. Such services include transaction processing accounts payableprocessing tele-calling training learning and development. The revenue earned from theshared services business during the year was `18.18 cr. The business had 283 employees ason 31st March 2021.
Sundaram Business Services Limited
Sundaram Business Services Limited (SBSL) is a global outsourcingcompany offering a wide range of services to domestic and overseas clients. The serviceofferings of SBSL include best in class outsourcing to 41 clients in India AustraliaU.S.A and the UK. During the year SBSL earned a revenue of `33.94 cr. and reported aprofit after tax of `3.75 cr.
INVESTMENTS MADE / PROPOSED TO BE MADE BY THE COMPANY
During the financial year 2020-21 your Company made portfolioinvestments and obtained the approval of the Board of Directors for prospectiveinvestments in the following entities:
|Name of the Entity ||Amount of Investment (not exceeding) (Rs. in cr.) ||% Stake ||Remarks |
|Wheels India Limited ||100.00 ||9.70 ||Investment by way of an acquisition from the JV Partner viz. Titan Europe Limited as part of the Company's strategy to consolidate its holdings. |
|Mind S.r.l. Italy (Mind) ||23.71 ||40.60 ||Investment by way of an acquisition from the Italian promoters of Mind in continuation of the strategy to focus on the automotive space and explore new lines of business therein. We believe that the carbon fiber market though nascent in India now will grow in size in the long term and the technology and expertise from Mind will position us well in the market. |
|Brakes India Private Limited ||350.00 ||7.71 ||Approval obtained for investment by way of an acquisition from the JV Partner viz. ZF International UK Limited as part of the Company's strategy to consolidate its holdings subject to all necessary approvals. |
|Flometallic India Private Limited* ||13.00 ||6.84 ||Approval obtained for investment by way of an acquisition from the individual promoters of FIPL as part of the Company's strategy to consolidate its holdings. |
* This investment has since been completed on 30th April 2021
The Company holds investments in 19 portfolio companies as at31.03.2021. The total cost of these investments is `286.60 cr. The performance of the keyportfolio companies during 2020-21 was as follows:
| || || || || || ||(Rs. in cr.) |
|S No. Portfolio Company ||Holding Cost ||Holding (%) ||Networth ||Share of Networth ||PAT ||Share of PAT |
|1 Turbo Energy Pvt Ltd ||1.88 ||32.00 ||1541.99 ||493.44 ||102.14 ||32.68 |
|2 India Motor Parts & Accessories Limited ||6.36 ||18.62 ||935.21 ||174.14 ||31.64 ||5.89 |
|3 Brakes India Pvt Ltd ||0.15 ||6.67 ||2441.50 ||162.85 ||245.74 ||16.39 |
|4 Wheels India Ltd ||141.68 ||23.28 ||599.32 ||139.52 ||6.75 ||1.57 |
|5 The Dunes Oman FZC (LLC) ||21.56 ||43.69 ||213.72 ||93.37 ||19.79 ||8.65 |
|6 Sundaram Clayton Ltd ||14.28 ||11.24 ||715.88 ||80.46 ||75.84 ||8.52 |
|7 Flometallic India Pvt Ltd ||38.00 ||40.00 ||184.90 ||73.96 ||24.13 ||9.65 |
|8 Lucas-TVS Ltd ||0.27 ||5.32 ||1057.63 ||56.27 ||147.50 ||7.85 |
|9 Axles India Ltd ||10.16 ||38.81 ||135.52 ||52.59 ||2.96 ||1.15 |
|10 Delphi TVS Technologies Limited ||0.18 ||3.19 ||389.63 ||12.43 ||32.68 ||1.04 |
|11 Mind S.r.l. ||23.71 ||40.60 ||3.69 ||1.50 ||-25.51 ||-10.36 |
|12 Others ||28.36 ||NA ||166.06 ||33.17 ||14.35 ||5.51 |
|Total ||286.60 || || ||1373.69 || ||88.55 |
Note: The figures relating to the companies mentioned under Sl.Nos. 3 8 and 10 are based on the audited financial results for the year ended 31st March2020. The figures relating to the company mentioned under Sl. No. 2 are based on theunaudited financial results for the nine months ended 31st December 2020 which weresubjected to Limited Review. The figures relating to the company mentioned under Sl. no.11 are based on the unaudited financial results for the year ended 31st March 2021 Thefigures relating to the companies mentioned under Sl. Nos. 14567 and 9 are based onthe audited financial results for the year ended 31st March 2021.
Turbo Energy Private Limited
Turbo Energy Private Limited is the leading manufacturer of turbochargers and turbo charger parts in the country. Your Company holds a 32% stake in TurboEnergy Private Limited and has been categorised as one of the promoters of that company.BorgWarner Turbo Systems (Germany) and Brakes India Private Limited are the otherpromoters of the company. During the year the revenue earned by the company stood at`1333.64 cr. as against `1375.16 cr. in the previous year. The profit after tax for theyear was `102.14 cr. as against `100.76 cr. in the previous year registering a growth of1.37%.
India Motor Parts and Accessories Limited
India Motor Parts and Accessories Limited is the largest distributor ofautomotive spare parts and equipment in the country. Your Company holds a 18.62% stake inIndia Motor Parts and Accessories Limited. For the period ended 31st December 2020the revenue earned by the company stood at `373.46 cr. as against `417.55 cr. for thecorresponding period in the previous year. The profit after tax for the nine months ended31st December 2020 stood at `31.64 cr. as against `35.13 cr. for the corresponding periodin the previous year. The market capitalisation of the company as on 31st March 2021 was`849.64 cr. The value of your Company's holding on that basis was `158.20 cr. as on31st March 2021.
Brakes India Private Limited
Brakes India Private Limited is the market leader in the manufacture ofbraking systems for cars and commercial vehicles in the country. Your Company holds a6.67% stake in Brakes India Private Limited and has been categorised as one of thepromoters of that company. The ZF Group and TVS Group are the other promoters of thecompany. The revenue earned by the company for the year ended 31st March 2020 stood at`3990.10 cr. as against `4896.12 cr. The profit after tax for the year ended 31st March2020 was `245.74 cr. as against ` 473.86 cr. in the previous year.
During the year as part of the Company's strategy to consolidateits holdings in the portfolio companies the Board of Directors approved the acquisitionof an additional 7.71% stake in Brakes India Private Limited from the foreign promoter ofthat company viz. ZF International UK Limited for a total consideration not exceeding`350 cr. In order to meet the funding requirement for the said acquisition the Boardapproved the raising of funds by way of a rights issue of up to 71000000 fully paid-upequity shares of the Company of face value of `5/- each aggregating up to `355 cr. forcash at a price of `50/- per rights equity share (including a premium of `45/- per rightsequity share) in the ratio of 23 rights equity shares for every 49 equity sharesheld by the eligible equity shareholders on the Record Date i.e. 27th April 2021 fixedfor the said purpose. The rights issue commenced on 6th May 2021 and closed on 4thJune 2021. The allotment of the 71000000 rights equity shares has been approved by theBoard at its meeting held on 10th June 2021.
Dunes Oman LLC (FZC)
Dunes Oman LLC (FZC) operating in Salalah Sultanate of Oman isengaged in the manufacture of iron castings for the automotive industry. Your Companyholds a 43.69% stake in Dunes Oman LLC (FZC) and has been categorised as one of thepromoters of that company. Dunes Oman was co-promoted with Brakes India Private Limited.The company's revenue for the year stood at `231.85 cr. as against `262.01 cr. in theprevious year while the profit after tax for the year was `19.79 cr. as against `17 cr.in the previous year.
Sundaram Clayton Limited
Sundaram Clayton Limited is engaged in the manufacture of precisionaluminium cast products for both automotive and non-automotive applications. Your Companyholds 11.24% stake in Sundaram Clayton Limited and has been categorised as one of thepromoters of that company. The TVS Group is the other promoter of the company. During theyear the revenue earned by the company stood at `1288.08 cr. as against `1424.14 cr. inthe previous year. The profit after tax for the year was `75.84 cr. as against `68.70 cr.in the previous year registering a growth of 10.39%. The market capitalisation of thecompany as on 31st March 2021 was `6234.11 cr. The value of your Company's holding onthat basis was `700.40 cr. as on 31st March 2021. Your Company received a total dividendof ` 3.41 cr. from Sundaram Clayton Limited during the financial year 2020-21.
Flometallic India Private Limited
Flometallic India Private Limited is engaged in the manufacture of ironcastings for the automotive industry. Your Company holds a 40.00% stake in FlometallicIndia Private Limited. During the year the revenue earned by the company stood at `274.51cr. as against `304.08 cr. in the previous year. The profit after tax for the year was`24.13 cr. as against `10.15 cr. in the previous year. Your Company received a totaldividend of `3.80 cr. from Flometallic India Private Limited during the financial year2020-21.
During the year as part of the Company's strategy to consolidateits holdings in the portfolio companies the Board of Directors approved the acquisitionof an additional 6.84% stake in Flometallic India Private Limited from the individualshareholders of that company for a total consideration not exceeding `13 cr. resultingin the stake going up to 46.84%. The said acquisition has since been completed on 30thApril 2021 at a total consideration of `12.50 cr.
Wheels India Limited
Wheels India Limited is the leading manufacturer of wheels and airsuspension components for cars and commercial vehicles in the country.
During the year as part of the Company's strategy to consolidateits holdings in the portfolio companies your Company acquired an additional 9.70% stakein Wheels India Limited from the foreign promoter of that company viz. Titan EuropeLimited for a total consideration of `100 cr. Pursuant to the said acquisition yourCompany's stake in Wheels India Limited increased from 13.58% to 23.28%. Your Companyhas been categorised as one of the promoters of Wheels India Limited. The TVS Group is theother promoter of the company. During the year the revenue earned by the company stood at`2215.55 cr. as against `2438.72 cr. in the previous year. The profit after tax for theyear was `6.75 cr. as against `54.11 cr. in the previous year. The market capitalisationof the company as on 31st March 2021 was `1088.92 cr. The value of your Company'sholding on that basis was `253.45 cr. as on 31st March 2021. Your Company received atotal dividend of `1.48 cr. from Wheels India Limited during the financial year 2020-21.
Axles India Limited
Axles India Limited is a leading manufacturer of axle housings formedium and heavy commercial vehicles in the country. Your Company holds a 38.81% stake inAxles India Limited and has been categorised as one of the promoters of that company. DanaCorporation (USA) and Wheels India Limited are the other promoters of the company. Duringthe year the revenue earned by the company stood at `312.02 cr. as against `408.62 cr. inthe previous year. The profit after tax for the year was `2.96 cr. as against `12.17 cr.in the previous year. Your Company received a total dividend of `1.48 cr. from Axles IndiaLimited during the financial year 2020-21.
Lucas-TVS Limited is engaged in the manufacture of auto electricalequipment. Your Company holds a 5.32% stake in Lucas-TVS Limited and has been categorisedas one of the promoters of that company. The TVS Group is the other promoter of thecompany. The revenue earned by the company for the year ended 31st March 2020 stood at`2124.03 cr. as against `2571.71 cr. in the previous year. The profit after tax for theyear ended 31st March 2020 was `147.50 cr. as against `90.79 cr. in the previousyear registering a growth of 62.47%. Your Company received a total dividend of `1.04 cr.from Lucas-TVS Limited during the financial year 2020-21.
Delphi-TVS Technologies Limited
Delphi-TVS Technologies Limited is engaged in the manufacture of dieselfuel injection equipment for passenger vehicles commercial vehicles and tractors. YourCompany holds a 3.19% stake in Delphi-TVS Technologies Limited and has been categorised asone of the promoters of that company. Delphi Automotive Systems and the TVS Group are theother promoters of the company. The revenue earned by the company for the year ended 31stMarch 2020 stood at `1101.95 cr. as against `1241.56 cr. in the previous year. The profitafter tax for the year ended 31st March 2020 was `32.68 cr. as against `73.28 cr. in theprevious year.
A detailed report on corporate governance together with a certificatefrom the Secretarial Auditor in compliance with the relevant provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is attached as part of thisreport vide Annexure II. Compliance reports in respect of all laws applicable to theCompany have been reviewed by the Board of Directors.
RELATED PARTY TRANSACTIONS
All transactions entered into by the Company with related parties werein the ordinary course of business and on an arm's length basis. The transactionsentered into by the Company with Sundaram Finance Limited during the financial year2020-21 were material in nature [as per the definition provided under Regulation 23(1) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015] for whichapproval of the shareholders was obtained vide ordinary resolution dated 18th July 2018.The Company did not enter into any material transaction with other related parties duringthe year.
Form AOC-2 as required under Section 134(3)(h) of the Act read withRule 8(2) of the Companies (Accounts) Rules 2014 is attached as part of this report videAnnexure III(i). Further the Company's policy on Related Party Transactions isattached as part of this report vide Annexure III(ii) as required under Reg. 23(1) ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. As requiredunder Schedule V to the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the details of the related party transactions with Sundaram FinanceLimited Promoter have been provided under Note 29 - Related Party Transactions formingpart of the notes to the accounts.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your Company has contributed towards education as well as socialwelfare in consonance with its CSR policy. The Annual Report on CSR Activities undertakenby the Company for the Financial Year 2020-21 is annexed with this report vide AnnexureIV.
BUSINESS RESPONSIBILITY REPORT
A Business Responsibility Report as required under Regulation 34(2)(f)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 isenclosed as part of this report vide Annexure V.
DISCLOSURE UNDER THE PREVENTION OF SEXUAL HARASSMENT AT WORKPLACEPOLICY'
The Company has in place a Policy for prevention of Sexual Harassmentin line with the requirements of The Sexual Harassment of Women at the Workplace(Prevention Prohibition & Redressal) Act 2013. An Internal Complaints Committee(ICC) has been set up to redress complaints. All employees (permanent contractualtemporary trainees) are covered under this policy. No complaints were received during thefinancial year. None was pending unresolved as on 31st March 2021.
In terms of Section 204 of the Companies Act 2013 and the rulesthereunder the Company has appointed Mr. A. Kalyana Subramaniam Practising CompanySecretary as the Secretarial Auditor of the Company. The Secretarial Audit Reports of theCompany and the subsidiary viz. Sundaram Business Services Limited are annexed to thisReport vide Annexures VI(i) and VI(ii).
REMUNERATION TO DIRECTORS / KEY MANAGEMENT PERSONNEL
Disclosure pursuant to Rule 5 (1) of Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed vide Annexure VII.
EXTRACT OF ANNUAL RETURN
As required under Section 92 (3) of the Companies Act 2013 read withRule 12 (1) of the Companies (Management and Administration) Rules 2014 the link for thecopy of the annual return is http://www.sundaramholdings.in/csa/csa.aspx.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS
During the year under review no significant and material orders werepassed by the regulators courts or tribunals against the Company impacting its goingconcern status or its future operations.
INFORMATION AS PER SECTION 134(3)(M) OF THE COMPANIES ACT 2013 READWITH RULE 8 OF THE COMPANIES (ACCOUNTS) RULES 2014
Your Company has no activity relating to conservation of energy ortechnology absorption. During 2020-21 foreign currency expenditure amounted to `23.71 cr.There were no earnings in foreign currency.
INTERNAL FINANCIAL CONTROLS
The Company has a well-established internal financial control and riskmanagement framework with appropriate policies and procedures to ensure the higheststandards of integrity and transparency in its operations and a strong corporategovernance structure while maintaining excellence in services to all its stakeholders.Appropriate controls are in place to ensure: (a) the orderly and efficient conduct ofbusiness including adherence to policies (b) safeguarding of assets (c) prevention anddetection of frauds / errors (d) accuracy and completeness of the accounting records and(e) timely preparation of reliable financial information.
Your Company has taken effective steps to build a robust riskmanagement framework. Engaged as it is in the business of making investments andbusiness process outsourcing services the Company is required to manage various risksincluding investment related risk business and market risk operational risk andtechnology related risk. The Company has established systems and procedures to ensure thatthese risks are identified measured and managed effectively. The Audit Committee reviewsthese risks on a regular basis. Operational risks arising from inadequate or failedinternal processes people and systems or from external events are adequately addressed bythe internal control systems. These systems are continuously reviewed monitored andmodified as necessary. A stable and experienced management team provides much neededcontinuity and expertise in managing the dynamic changes in the market environment.Process improvements and quality control are on-going imperatives and are built into theemployees' training modules as well. The Company has well documented Standard OperatingProcedures for all processes to ensure better control over transaction processing andregulatory compliance.
As part of the efforts to evaluate the effectiveness of the internalcontrol systems your Company has employed the services of the Internal Audit Department(IAD) of Sundaram Finance Limited (SFL) to independently evaluate the adequacy of controlmeasures on a periodic basis and recommend improvements wherever appropriate. TheInternal Audit team plays a vital role in continuously monitoring the effectiveness of theStandard Operating Procedures as a part of risk mitigation.
The IAD of SFL is manned by highly qualified and experienced personneland reports directly to the Audit Committee of the Board. The Audit Committee regularlyreviews the audit findings as well as the adequacy and effectiveness of the internalcontrol measures.
In an environment that is rapidly becoming technology and digitaloriented your Company believes in investing in long term people development fororganisational excellence. Part of the enduring tradition of the Sundaram Finance Groupover the decades has been the handing down of wisdom to successive generations ofemployees using the conventional methods of listening observing and on the job training.Your Company proposes to continue the tradition along with appropriate technologicalsupport to meet the challenges of growth and scale.
Employee safety has been of prime importance to your Company during thepandemic. With a view to ensuring the safety of its employees alongside businesscontinuity the Company has put in place all the standard operating procedures notified bythe Central and State Governments and these are implemented in full measure togetherwith appropriate work from home' policies.
Your Company's operations are supported by a full-fledged DataCentre catering not only to its own needs but also those of its subsidiary with over99.5% uptime. Your company has a well-planned Business Continuity Plan for all criticalapplications with near real-time data replication. The delivery centres meet theInformation Security Management System and CIA (Confidentiality Integrity andAvailability) Standards. To cater to the ever-changing customer needs the ITinfrastructure is being constantly upgraded with new / enhanced features to facilitatesmooth functioning of operations and deliver customer satisfaction.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the provisions of Section 129 (3) of the CompaniesAct 2013 the Consolidated Financial Statements drawn up in accordance with theapplicable Accounting Standards form part of the Annual Report. A separate statementcontaining the salient features of the financial statements of your Company'sSubsidiary and Associates in Form AOC-I forms part of the Annual Report.
The annual report of the subsidiary Sundaram Business ServicesLimited has been posted on your Company's website - www.sundaramholdings.in.Detailed information including the annual accounts of the Subsidiary Company will beavailable for inspection by the members at the registered office of the Company and willalso be made available to the members upon request.
BOARD AND AUDIT COMMITTEE
The details regarding number of Board Meetings held during thefinancial year and composition of Audit Committee are furnished in the CorporateGovernance Report.
Sri T.T. Srinivasaraghavan Chairman retires by rotation and beingeligible offers himself for re-election.
KEY MANAGERIAL PERSONNEL
During the year 2020-21 Sri S. Ravi Manager under the Companies Act2013 was designated as Chief Executive Officer of the Company for a period of 3 yearswith effect from 19th May 2020 in the place of Sri Paramesh Krishnaier who demittedoffice as Chief Executive Officer of the Company with effect from 18th May 2020. Therewere no other changes in the key managerial personnel.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each IndependentDirector of the Company under Section 149 (7) of the Companies Act 2013 that theIndependent Directors of the Company meet with the criteria of their Independence laiddown in Section 149 (6).
ANNUAL EVALUATION BY THE BOARD
The Board has made a formal evaluation of its own performance and thatof its committees and individual directors as required under Section 134(3)(p) of theCompanies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT
Your directors confirm that:
1. In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
2. The Company has selected such accounting policies and applied them consistently andmade judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the financial year and ofthe profit of the company for that period;
3. Proper and sufficient care has been exercised 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;
4. The annual accounts have been prepared on a going concern basis;
5. Adequate internal financial controls have been put in place and they are operatingeffectively; and
6. Proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
M/s R.G.N. Price & Co. Chartered Accountants Chennai have beenappointed as Statutory Auditors of your Company to hold office for a term of five (5)consecutive years from the conclusion of the 23rd Annual General Meeting until theconclusion of the 28th Annual General Meeting at such remuneration as may be mutuallyagreed between the Board of Directors of the Company and the Statutory Auditors.
Your directors gratefully acknowledge the support and cooperationextended to your Company by all its customers shareholders and bankers. Your directorsalso place on record their special appreciation of the employees of the Company for theirdedication and commitment in delivering the highest quality of service to every one of ourvalued customers during these trying times.