To the Members of Surana Solar Limited
Your Directors have pleasure in presenting the 15th Annual Report and the AuditedStatement of Accounts for the financial year ended 31st March 2021 together with theAuditors Report thereon.
The performance of the Company during the year is summarized below:
(Amount in Rs.)
|Particulars ||2020-21 ||2019-20 |
|Net Sales and other Income ||283507733 ||341749125 |
|Profit before Depreciation Interest and exceptional Items ||57753033 ||65547559 |
|DEDUCT: ||45509454 ||49461043 |
|Depreciation and Amortization Expenses || || |
|Interest and Finance charges ||8173272 ||8575529 |
|Profit for the year before exceptional items ||4070307 ||7510987 |
|Profit before Taxation ||4070307 ||7510987 |
|Provision for Taxation : Current Tax ||1850000 ||1896000 |
|Deferred Tax ||110000 ||(290000) |
|Profit after Tax ||2110307 ||5904987 |
|Add: Other Comprehensive Income || || |
|Total Comprehensive Income for the year ||2110307 ||5904987 |
|Surplus brought forward from previous year ||114920834 ||109015847 |
|Balance available for appropriation ||117031141 ||114920834 |
|Balance c/f to Balance Sheet ||117031141 ||114920834 |
OPERATION AND PERFORMANCE:
During the year under review the Income from Operations is Rs. 279421269 as againstRs. 331690019 for the corresponding previous year. The Profit Before Tax is Rs.4070307 as against Rs. 7510987 for the previous year. The Profit After Tax is Rs.2110307 as against Rs. 5904987 for the corresponding period. The Basic Earnings PerShare for the year-ended 31.03.2021 is Rs. 0.04 as against Rs. 0.12 for the correspondingprevious year ended 31.03.2020.
As reported in the last year China and some other countries continues to dumpsub-standard and cheap material to India. In such scenario it is difficult to compete withthe imports. In spite of such adverse conditions the Company is able to earn profits dueto effective cost control and savings interest cost.
Impact of global crisis Covid-19:
The outbreak of novel Coronavirus (COVID-19) pandemic globally and in India and theconsequent lockdown restrictions imposed by national governments is causing significantdisturbance and slowdown of economic activity across the globe. The Company has assessedthe possible effects that may arise from the COVID-19 pandemic on the business. As on thecurrent date based on the assessment the Company has concluded that the impact of C0VID- 19 pandemic is not material on the carrying values of the assets of the businesshowever this has effected the operations of the company and has had impact on sales andprofitability among others. Due to the nature of the pandemic and the resultantoperational guidelines that may be announced by the governments in future the Companywill continue to monitor the developments to identify significant impact if any in thefuture period.
BUSINESS DEVELOPMENT AND PROSPECTS:
The Company is participating in various tenders floated by government andnon-government organisations to widen its activities by entering into EPC contracts andsolar rooftop business.
The Company has installed cumulative capacity of 4.2 MW roof top solar through EPC forvarious customers in Telangana State.
In the year 2016 your Company was awarded an EPC contract for execution operation& maintenance of a 10MW (AC) Solar Power Plant by Paradip Port Trust (PPT) in the year2016. However in the course of implementation certain disputes arose between the Companyand PPT with regard to the project. PPT had cancelled the LOI/terminated the contract andencashed the Performance Bank Guarantee and Mobilization advance Bank Guarantee.
The Company had challenged such arbitrary action before the Arbitral Tribunalconstituted by the Hon'ble High Court of Odisha. Upon the contest the Tribunal on 8thApril 2021 has passed an Award in favour of the Company for a sum of Rs. 86934723/-towards the amount of encashed Bank Guarantee interest on such amount and Arbitrationcost.
The Company does not have any Subsidiary or Associate Company. However your Company isan Associate Company of Surana Telecom and Power Limited.
The Directors state that applicable Secretarial Standards i.e. SS-1 and SS-2relating to Meetings of the Board of
Directors' and General Meetings' respectively have been duly followed by theCompany.
The paid-up Share Capital of the Company as on 31st March 2021 is Rs.246033000divided into 49206600 equity shares of Rs.5/- each. During the year there was nochange in the Paid-up Capital of the Company.
TRANSFER TO RESERVES:
The Board of Directors of the Company have not recommended for transfer of any amountto the General Reserve for the financial year ended 31st March 2021.
The Board of Directors have not recommended the dividend due to low profitability forthe financial year 2020-21.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion and Analysis Report as required under schedule V of the SEBI(Listing Obligations and Disclosure Requirement) Regulations 2015 forms an integral partof this Report and gives details of the overall industry structure developmentsperformance and state of affairs of the Company's business internal controls and theiradequacy risk management systems and other material developments during the financialyear.
Management Discussion and Analysis Report is presented in a separate section forms partof the Annual Report as Annexure-II.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto the Directors' Responsibility Statement the Board of Directors of the Company herebyconfirms:
(a) That the preparation of the annual accounts for the financial year ended 31stMarch 2021 the applicable accounting standards have been followed along with properexplanation relating to material departures;
(b) That the directors have 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 at the end of thefinancial year 2020-21 and of the profit and loss of the company for that period;
(c) That the directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;
(d) That the directors have prepared the annual accounts for the financial year endingon 31st March 2021 on a going concern basis; and
(e) That the directors have laid down Internal Financial Controls to be followed by thecompany and that such Internal Financial Controls are adequate and were operatingeffectively; and
(f) That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
The Independent Directors have submitted the declaration of independence as requiredpursuant to sub-section (7) of section 149 of the Companies Act 2013 and Regulation 25(8)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 stating thatthey meet the criteria of independence as provided in sub-section (6) of Section 149 andRegulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
NOMINATION AND REMUNERATION POLICY:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy which lays down a framework in relation to selection appointment andremuneration of Directors Key Managerial Personnel and Senior Management of the Company.The details of Nomination and Remuneration Committee and Policy are stated in theCorporate Governance Report.
PARTICULARS OF LOANS GUARANTEES SECURITIES AND INVESTMENTS:
The details of Loans Guarantees Securities and Investments made during the financialyear ended 31st March 2021 are given in the notes to the Financial Statements incompliance with the provisions of Section 186 of the Companies Act 2013 read withCompanies (Meetings of Board and its Powers) Rules 2014.
RELATED PARTY TRANSACTIONS:
All transactions entered with Related Parties for the year under review were on arm'slength basis and in the ordinary course of business. There are no materially significantrelated party transactions made by the Company with Promoters Directors Key ManagerialPersonnel or other designated persons which may have a potential conflict with theinterest of the Company at large. All Related Party Transactions are placed before theAudit Committee as also before the Board for approval where ever required. Prior omnibusapproval of the Audit Committee is obtained for the transactions which are of aforeseeable and repetitive nature. A statement giving details of all related partytransactions entered into pursuant to the omnibus approval so granted are placed beforethe Audit Committee and the Board of Directors on a quarterly basis. The Company hasdeveloped a Policy on Related Party Transactions for the purpose of identification andmonitoring of such transactions. The policy on Related Party Transactions as approved bythe Board is uploaded on the Company's website http://suranasolar.com/corporate_gov.php.
The particulars of contracts or arrangements with related parties referred to insub-section (1) of section 188 is prepared in Form AOC-2 pursuant to clause (h) ofsub-section (3) of section 134 of the Act 2013 and Rule 8(2) of the Companies (Accounts)Rules 2014 and the same is annexed herewith as "Annexure-IM" to this Report.
The Audit Committee consists of Shri R Surender Reddy (Independent Director) asChairman Shri N. Krupakar Reddy (Add. Independent Director) Smt. Sanjana Jain (Add.Independent Director) and Shri Narender Surana (Director) as members. The Committee interalia reviews the Internal Control System Reports of Internal Auditors and Compliance ofvarious regulations. The Committee also reviews the financial statements before they areplaced before the Board.
The Board at its meeting held on 29.09.2020 and through circular resolution on10.06.2021 re-constituted the Audit Committee upon resignation of Smt. Madhumathi Sureshand on demise of Dr. R N Sreenath respectively.
The recommendations made by the Audit Committee to the Board from time to time duringthe year under review have been accepted by the Board. Other details with respect to theAudit Committee such as its terms of reference the meetings of the Audit Committee andattendance thereat of the members of the Committee are separately provided in this AnnualReport as a part of the Report on Corporate Governance.
EXTRACT OF ANNUAL RETURN:
The Annual Return in Form MGT-7 is available on the Company's website the web link forthe same is http://www.suranasolar.com/annual.php.
PARTICULARS IN RESPECT OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGNEXCHANGE EARNINGS AND OUTGO:
The information on Conservation of Energy Technology Absorption Foreign ExchangeEarnings and outgo required to be disclosed under Section 134(3)(m) of the Companies Act2013 read with Rule 8 of the Companies (Accounts) Rules 2014 are provided inAnnexure-I' forming part of this Report.
RISK MANAGEMENT POLICY:
In terms of the requirement Section 134(3)(n) of the Companies Act 2013 and Regulation21 of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 the Company has developed and implemented the RiskManagement Policy. The Audit Committee has additional oversight in the area of financialrisks and controls. Major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuing basis. The developmentand implementation of risk management policy has been covered in the management discussionand analysis report which forms part of this report. At present the Company has notidentified any element of risk which may threaten the existence of the company.
During the year under review pursuant to the provisions of the Companies Act 2013 andSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the evaluation ofperformance of all Directors is undertaken annually. The company has implemented a systemof evaluating performance of the Board of Directors and of its Committees and individualDirectors on the basis of a structured questionnaire which comprise evaluation criteriataking into consideration various performance related aspects. The Board of Directors haveexpressed their satisfaction with the evaluation process.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Shri Narendra Surana Director of the Company will retire by rotation at the ensuingAnnual General Meeting and being eligible offers himself for re-appointment.
Smt. Madhumathi Suresh Independent Director of the Company resigned from herDirectorship effective from 29.09.2020 due to pre-occupation and Smt. Sanjana Jain wasappointed as Additional Independent Director w.e.f. 29.09.2020 on the recommendation ofthe Nomination & Remuneration Committee for a period of five (5) consecutive yearssubject to the approval of shareholders members in this ensuing Annual General Meeting.
Dr. R N Sreenath Independent Director of your company left for his heavenly abode onthe 21st March 2021. Consequently in order to maintain the composition of the Board asper the provisions of the Companies Act 2013 read with underlying rules and Regulation17 of the SEBI (LODR) Regulations 2015 Shri N Krupakar Reddy has been appointed as anAdditional Independent Director w.e.f. 8th June 2021 on the recommendation of theNomination & Remuneration Committee for a period of five (5) consecutive yearssubject to approval of shareholders in this ensuing Annual General Meeting.
The brief particulars of the Directors seeking appointment / re-appointment at thisAnnual General Meeting is annexed to the Notice.
Pursuant to the provisions of Section 203 of the Act Shri Manish Surana Whole-timeDirector and Chief Financial Officer and Mrs. Swapna Gade Company Secretary are KeyManagerial Personnel of the Company.
MEETINGS OF THE BOARD:
During the financial year under review 5 (Five) Board Meetings were convened and held.The intervening gap between the meetings was within the period of 120 days as prescribedunder the Companies Act 2013 and Regulation 17 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 except the first board meeting dated23.06.2020 owing to the CoVID-19 pandemic and as per the relaxations given by MCA videGeneral Circular No. 11/2020 and SEBI vide circular no. SEBI/HO/CFD/CMD1/CIR/P/2020/38dated March 24 2020 and March 19 2020.
The Company has not accepted any deposits in terms of Section 73 or 76 of the CompaniesAct 2013 and as such no amount on account of principal or interest on public depositswas outstanding as on the date of the balance sheet.
LISTING OF EQUITY SHARES:
The Company's equity shares are listed on the following Stock Exchanges:
(i) BSE Limited Phiroze JeeJeebhoy Towers Dalal Street Mumbai - 400 001Maharashtra India; and
(ii) National Stock Exchange of India Limited Exchange Plaza Floor 5 Plot No.C/1 G Block Bandra - Kurla Complex Bandra (East) Mumbai - 400 051 Maharashtra India.
The Company has paid the Annual Listing Fees to the said Stock Exchanges for theFinancial Year 2021-22.
M/s. Luharuka & Associates Chartered Accountants were appointed as StatutoryAuditors of your Company at the Annual General Meeting held on 26th September 2017 for aterm of five consecutive years subject to ratification by Members at every Annual GeneralMeeting. However in accordance with the Companies Amendment Act 2017 enforced on 7thMay 2018 by the Ministry of Corporate Affairs the appointment of Statutory Auditors isnot required to be ratified at every Annual General Meeting. M/s. Luharuka &Associates Chartered Accountants have confirmed that they are not disqualified fromcontinuing as Auditors of the Company.
There are no qualifications reservations or adverse remarks made by M/s. Luharuka& Associates Chartered Accountants and Statutory Auditors in their report for thefinancial year ended 31st March 2021.
The Statutory Auditors have not reported any incident of fraud to the Audit Committeeof the Company in the year under review.
The Board of Directors based on the recommendation of the Audit Committee has appointedM/s. Sekhar & Co. Chartered Accountants as the Internal Auditors of your Company. TheInternal Auditors are submitting their reports on quarterly basis to the Audit Committeeand Board of Directors.
The Board of Directors of the Company have re-appointed M/s Sekhar & Co. CharteredAccountants as Internal Auditors to conduct Internal Audit for the financial year ended3151 March 2021.
The Company has maintained cost records as specified by Central Government underSection 148(1) of Companies Act 2013 and such records have been audited by the CostAuditor pursuant to Companies (Cost Records and Audit) Rules 2014.
M/s Lavanya & Associates Cost Accountants Hyderabad has been appointed by theBoard on recommendations of Audit Committee as Cost Auditor for conducting audit of thecost accounts maintained by the Company relating to Electricity for the financial year2020-21.
The Board of Directors of the Company appointed Mrs. Rakhi Agarwal Company Secretaryin Practice Hyderabad to conduct Secretarial Audit for the financial year 2020-21.
The Secretarial Audit Report issued by Mrs. Rakhi Agarwal Company Secretary inPractice for the financial year 2020-21 is annexed herewith as Annexure-IV.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
ANNUAL SECRETARIAL COMPLIANCE REPORT:
The Company has undertaken an audit for the Financial Year 2020-21 for all applicablecompliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by Mrs.Rakhi Agarwal Company Secretary in Practice has been submitted to the Stock Exchanges andis annexed at Annexure V to this Board's Report.
The Company has implemented the procedures and adopted practices in conformity with theCode of Corporate Governance as per the requirements of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.
A separate report on corporate governance practices followed by the Company togetherwith a Certificate from the Company's Auditors confirming compliances forms an integralpart of this Report.
The Company has adopted a Whistle Blower Policy establishing vigil mechanism toprovide a formal mechanism to the Directors and employees to report concerns aboutunethical behavior actual or suspected fraud or violation of Code of Conduct and Ethics.It also provides for adequate safeguards against the victimization of employees who availof the mechanism and provides direct access to the Chairperson of the Audit Committee inexceptional cases. It is affirmed that no personnel of the Company has been denied accessto the Audit Committee. The policy of vigil mechanism is available on the Company'swebsite.
PARTICULARS OF EMPLOYEES:
A. Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197(12) of Companies Act 2013 and Rule 5 (1) Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is provided as follows:
(i) The ratio of the remuneration of each director to the median remuneration of theemployees of the company for the financial year;
|Name of the Director ||Ratio to Median Remuneration |
|Shri Manish Surana WTD ||23.85 |
(ii) The percentage increase in remuneration of each director Chief Financial OfficerChief Executive Officer Company Secretary or Manager if any in the financial year;
|Name of Person ||% increase in remuneration |
|Shri Manish Surana WTD ||0.00 |
|Mrs. Swapna Gade CS ||0.00 |
(iii) The percentage increase in the median remuneration of employees in the financialyear is : 1.74%
(iv) The number of permanent employees on the rolls of company : 7
(v) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration;
(vi) The average increase in salaries of employees other than managerial personnel in2020-21 was NIL. Percentage increase in the managerial remuneration for the year was Nil.
(vii) Affirmation that the remuneration is as per the remuneration policy of thecompany - Yes.
B. In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and5(3) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014 a statement showingthe names of the top ten employees in terms of remuneration drawn and names and otherparticulars of the employees drawing remuneration in excess of the limits set out in thesaid rules forms part of this Report.
Having regard to the provisions of the second proviso to Section 136(1) of the Act andas advised the Annual Report excluding the aforesaid information is being sent to themembers of the Company. The said Annexure is open for inspection at the Registered officeof your Company. Any member interested in obtaining copy of the same may write to CompanySecretary.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee of the Board.
The Internal Auditors team carries out extensive audit and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company and its subsidiaries.Based on the report of internal audit function process owners undertake corrective actionin their respective areas and thereby strengthen the controls. Significant auditobservations and corrective actions thereon are presented to the Audit Committee of theBoard.
CHANGE IN NATURE OF BUSINESS:
There is no change in nature of business of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURT:
There are no significant and material orders passed by the Regulators or Courts orTribunals which would impact the going concern status of the Company and its futureoperations.
MATERIAL CHANGES AND COMMITMENTS:
There are no material changes and commitments affecting the financial position of theCompany which occurred between the end of the financial year 31st March 2021 to which thefinancial statements relates and the date of signing of this report.
The industrial relations of the Company continued to be harmonious during the yearunder review.
ISO 9001-2008 CERTIFICATION:
Your Company continues to hold ISO 9001-2008 Certification by meeting all therequirements of Certification from time to time.
POLICY ON SEXUAL HARASSMENTS:
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.
The Internal Complaints Committee (ICC) has been setup to redress complaint receivedregarding sexual harassment. During the period under review no complaints were receivedby the ICC.
Statements in the Board's Report and the Management Discussion & Analysisdescribing the Company's objectives expectations or forecasts may be forward-lookingwithin the meaning of applicable securities laws and regulations. Actual results maydiffer materially from those expressed in the statement. Important factors that couldinfluence the Company's operations include global and domestic demand and supplyconditions affecting selling prices of finished goods input availability and priceschanges in government regulations tax laws economic developments within the country andother factors such as litigation and industrial relations.
The Directors take this opportunity to place on record their sincere thanks to thesuppliers customers strategic partners Banks and Financial Institutions InsuranceCompanies Central and State Government Departments and the shareholders for their supportand co-operation extended to the Company from time to time. Directors are pleased torecord their appreciation of the sincere and dedicated services of the employees andworkmen at all levels.