The Directors have pleasure in presenting the twenty-sixth Annual Report and theaudited accounts of the Company for the year ended 31st March 2018.
1. COMPANY PERFORMANCE
The Company continued to grow ahead of the industry for the third year in successionregistering sales of 33.67 lakh two-wheelers in 2017-18 growing by 17.8% over last year.Sale of motorcycles increased by 25.8% and scooters by 30.4%. Three-wheeler sales of theCompany increased by 42.5% in 2017-18. Sale of spare parts grew by 16.6%.
The Company continues to lead the customer satisfaction in products and services andbagged top honors at the J.D. Power 2018 India Two-Wheeler Initial Quality Study (2WIQS)Automotive Product Execution & Layout (ApEAL) study and Two-Wheeler Customer ServiceIndex (2WCSI). The Company has been top ranked in JD Power 2WCSI since its inaugural studyin 2016.
The revenue for the year ended 31st March 2018 are not comparable with the previousyear consequent to introduction of GST effective 1st July 2017. For comparison the totalrevenue of the Company excluding excise duty increased from Rs. 12309 Cr in the previousyear to Rs. 15274 Cr in the current year. Profit before tax increased from Rs. 699 Cr inthe previous year to Rs.879 Cr in the current year. Similarly Profit after tax increasedfrom Rs. 558 Cr in the previous year to Rs.663 Cr in 2017-18.
2. FINANCIAL HIGHLIGHTS
|Details ||Year Ended 31-03-2018 ||Year Ended 31-03-2017 |
|SALES || || |
|Quantitative || |
(Numbers in Lakhs)
|Motorcycles ||13.55 ||10.77 |
|Mopeds ||8.77 ||9.11 |
|Scooters ||11.35 ||8.70 |
|Three-wheelers ||0.99 ||0.69 |
|Total vehicles sold ||34.66 ||29.27 |
|Financials || |
(Rupees in Crores)
|REVENUE || || |
|Motorcycles ||6075.88 ||4628.13 |
|Mopeds ||2149.74 ||2069.74 |
|Scooters ||4338.29 ||3337.84 |
|Three-wheelers ||856.18 ||647.96 |
|Spares & Accessories and raw materials ||1547.97 ||1327.59 |
|Other Operating Income ||161.60 ||124.05 |
|Other Income ||144.78 ||173.37 |
|Revenue excluding excise duty ||15274.44 ||12308.68 |
|Excise Duty ||# 343.22 ||1054.75 |
|Revenue including excise duty ||15617.66 ||13363.43 |
|EBITDA ||1273.99 ||1030.44 |
|Less: || || |
|Finance Charges & Interest (Gross) ||56.62 ||43.95 |
|Depreciation ||338.73 ||287.81 |
|Profit before tax ||878.64 ||698.68 |
|Provision for tax ||216.05 ||140.60 |
|Profit after tax ||662.59 ||558.08 |
# Includes Excise Duty upto June 2017.
The Board of Directors of the Company (the Board) at their meeting held on 1st November2017 declared a first interim dividend of Rs.2/- per share (200%) for the year 2017-18absorbing a sum of Rs. 114.36 Cr including dividend distribution tax. The same was paid tothe shareholders on 14th November 2017.
The Board at its meeting held on 26th February 2018 declared a second interim dividendof Rs. 1.30 per share (130%) for the year 2017-18 absorbing a sum of Rs.73.27 Cr includingdividend distribution tax. The same was paid to the shareholders on 12th March 2018.
Thus the total amount of both dividends for the year ended 31st March 2018 aggregatedto Rs. 3.30 per share (330%) on 475087114 equity shares of Re.1/- each absorbingRs.187.63 Cr including dividend distribution tax since the Company has set-off itsdividend distribution tax payable under Section 115-O(1A) of the Income Tax Act 1961 tothe extent available against the dividend distribution tax paid by one of its subsidiarycompany on its dividend declared.
The Board does not recommend any further dividend for the year under consideration.
4. MANAGEMENT DISCUSSION AND ANALYSIS REPORT INDUSTRY STRUCTURE AND DEVELOPMENTSTwo-wheeler
In the domestic market two-wheeler industry sales grew from 176 lakh units in 2016-17to 202 lakh units in 201718 registering a growth of 15% over last year. The first half ofthe year saw a growth of 10% led by re-stocking required due to BSIII to BSIV transition.The second half grew by 20% over the same period of 2016-17 which was affected bydemonetization.
Scooter as a category continued to gain category share in total two-wheeler industry.Scooters grew at 20% (from 56 lakh units to 67 lakh units) led by urban demand and thecategory share increased from 32% in 2016-17 to 33% in year 2017-18.
The motorcycle category grew at 14% (126 lakh units). Within motorcycles continuedtraction in urban demand enabled the premium segment to grow by 11% (from 17.1 lakh unitsin 2016-17 to 18.9 lakh units in 2017-18). Commuting segment also grew by 15% (from 84lakh units in 2016-17 to 97 lakh units in 2017-18) compared to a fiat growth in past 5years. This trend change in commuter segment was triggered by revival of rural demand.
Crude oil prices recovered steadily during 2017-18 and drove economic recovery in theinternational markets. Currencies stabilized and foreign exchange availability improved inaffected countries of Africa leading to recovery of the exports industry in 2017-18 froma low base in 2016-17. Bangladesh Mexico Argentina Philippines and West Africa saw anincrease in demand. Consequently exports of two-wheeler from India grew by 20% during2017-18.
Overall three-wheeler small passenger industry (3 plus 1 segment) grew by 39% in2017-18 (from 4.58 lakh units in 2016-17 to 6.35 lakh units in 2017-18). Domestic industrygrew by 41% and exports from India grew by 37% over 2016-17. Growth in domestic passengermarket was largely driven by significant growth in Maharashtra State due to opening ofpermits. Export market growth was a result of market recovery in Nigeria and Egypt andexpansion of some new markets.
BUSINESS OUTLOOK AND OVERVIEW
Economic activity is expected to improve in 2018-19 benefiting from improvedmacro-economic environment in both domestic and global markets.
In India focus on agriculture and rural development rolled out in the recent unionbudget supported by possibility of a normal monsoon is expected to positively influencedemand from rural markets. Improving credit growth supported by bank re-capitalizationalong with continued government focus on infrastructure is expected to drive growth.
Crude prices have been rising over last one year and this trend is expected to continuein 2018. On one hand this trend will continue to aid export market growth however on theother hand rising commodity prices will put cost pressures in the year 2018-19.
Consequently the growth in two-wheeler industry during 2018-19 is expected to bearound 8-10% over 2017-18.
New Product Launches and Initiatives
The Company has a strategic partnership with BMW Motorrad to develop and manufacturesub-500cc bikes both for domestic and global markets. The Company manufactured andsupplied 26471 units of G 310 R and G 310 GS in the year 2017-18 for BMW MotorradCompany.
During the year 2017-18 the following new products and variants were launched.
TVS Apache RR 310 marks a significant step in Company's history - TVS forays intosuperpremium motorcycles with this launch.
Inspired by 35 years of TVS Racing TVS Apache RR 310 combines superior performance& riding dynamics with a fully faired sporty design.
The motorcycle gets a 312cc single cylinder 4V liquid cooled 6-speed engine thatdelivers a top speed of 160 kmph and acceleration from 0-60 kmph in just 2.9 seconds. TVSApache RR 310 comes with an all-new race origin light-weight trellis-frame chassis forenhanced stiffness in straights and flex for dynamic cornering capability that result inbest-in-class riding dynamics.
The product created an instant excitement and garnered acceptance among the racingenthusiasts.
The Apache RTR 160 4V is the latest addition to the Apache portfolio it's not a sportsbike it's a Race Machine. This machine is born out of the six-time Indian NationalMotorcycle Championship (INMRC) winning motorcycle -
(Group B) RTR 165. Every feature on the Apache is honed on the race track to deliverthe best in racing performance. The TVS Apache RTR 160 4V is available in both Carburettorand Electronic Fuel Injection (EFI) variants with the latter christened as TVS Apache RTR160 Fi 4V. Staying true to its racing pedigree the TVS Apache RTR 160 4V has the powerful160cc engine enabling the best performance in its class and best-in-class power-to-weightratio. The motorcycle does 0-60 kmph in 4.8 seconds(EFI) and 4.73 seconds (Carburettor).
Designed for Gen-Z TVS NTORQ 125 provides revolutionary riding experience with cuttingedge style performance and technology. Based on TVS racing pedigree TVS NTORQ comes witha 125cc 3V CVTi-Rev engine. The first ever Bluetooth connected scooter with
TVS Smart Xonnect TVS NTORQ is equipped with caller ID Navigation assist andapp-enabled technology.
Stealth Aircraft-inspired design and 30 industry-first features make TVS NTORQ a one ofits kind product in the segment.
The product has garnered raving reviews and aims to gain mindshare among the youth oftoday.
Since its inception Jupiter brand has represented novelty. Launched in 2013 thescooter has now reached the 2.3 million mark in sales. The ability to develop tailor-madescooters for customers is the inspiration behind the creation of TVS Jupiter & itsvariants. The new Jupiter Classic edition is an embodiment of style. It comes loaded witha host of unique features such as Classic-Edition' Decals elegant Full ChromeMirrors a classy Chrome Pillion Handle and a choice of exclusive colours - Sunlit Ivoryand Autumn Brown. Thoughtfully designed features like a Smart USB Charger stylishwindshield Classy backrest Side Stand Indicator and a comfortable Dual Tone Seat ensurea great riding experience.
All this and more makes the Classic-Edition' a true example of brand Jupiter'sphilosophy Zyada ka Fayda' offering more than 15 features and benefits for theIndian commuter.
XL100 Heavy Duty vehicle aims to be a partner of the customer in his success byproviding more utility power and ruggedness through more pick up "Duragrip"tyre and heavy duty wheel assembly.
The superior quality of the Company's products and services is well established againin the recent JD Power Study 2018.
It is a significant feat for the Company that in the JD Power APEAL study 2018 itsproducts have been ranked No. 1 in all the product categories the Company participated in.TVS Jupiter in scooter segment TVS Apache RTR 180 in motorcycle premium segment and TVSStar City Plus in motorcycle economy segment holds the top position.
The Company retained the No.1 position in the CSI study 2018 by JD Power for third yearin a row.
The Company achieved sales of 28.7 lakh units of two- wheelers in the domestic market.With these sales the Company registered a growth of 15.5% in the year 2017-18 over lastyear.
In motorcycles the Company achieved sales of 9.2 lakh units and registered a growth of18.6% over 2016-17. TVS Apache accelerated its growth trend with 35% growth over lastyear. New TVS Apache RR 310 was received very well in the market and is contributing wellto the Apache brand.
In scooters the Company achieved sales of 11.0 lakh units and registered a growth of33% over 2016-17. TVS Jupiter maintained the momentum with a 32% growth over last year.The growth was largely supported by the special "Classic Edition" which alsohelped in bringing a premium image to the product. Launch of TVS NTORQ 125 is expected tobring a new segment of customers.
The Company has strong distribution network of authorized dealers across India andcontinuously seeks to increase its reach.
Exports sales - two-wheeler and three-wheeler
The Company's two-wheeler exports in the year 2017-18 were at 4.9 lakh units andwitnessed an improvement with a growth of 33.7% over 2016-17.
The Company's three-wheeler exports in the year 2017-18 were at 0.8 lakh units andrecorded a 44.4% growth over 2016-17.
Implementation of Goods and Services Tax Act (GST)
Effective 1st July 2017 the Company has successfully & seamlessly transitioned tonew GST regime. The Company also supported dealers & suppliers to change over withoutany disruption in their respective businesses. The Company
has passed on the benefits arising out of GST changeover to its customers.
Opportunities and Threats
Proposed thrust in rural India efficient implementation of various Government schemessuch as minimum support price of 1.5 times of the production cost and improved ruraleconomy will aid improvement of two-wheeler penetration.
Growing middle class aspirational life style need for mobility and increasedpenetration levels will continue to trigger growth of two-wheeler industry. Impetus from7th pay commission and payment of related arrears are further expected to boost thetwo-wheeler industry.
Alternate energy based mobility vehicles and solutions have gained traction in theyear. Rising pollution levels in Indian cities and target to become energy independent arethe major factors for such a push towards greener mobility.
The Company is committed to support this initiative by developing suitable technologyand business solutions. Strong presence of the Company in all segments of twowheelerindustry planned new launches and expanded network of dealers will help the Company toconsolidate its gain further and grow ahead of the Industry in the coming years.
RISKS AND CONCERNS
Good monsoon and stable policy environment are essential for growth in domestictwo-wheeler demand. The sustained momentum in scooters and motorcycles and success ofplanned launches is vital to achieve business objectives.
International factors such as geo-political scenarios and rising crude oil prices arebeing continuously monitored for both risks and opportunities.
Recent rise in commodity prices and intensifying competition with pricing led marketingactions remain a concern for bottom-line. The Company will initiate various cost reductionmeasures to mitigate this risk.
The Company is also investing in greener emerging technologies towards the futureconsumer preference shifts.
The Board has established a robust Risk Management framework to identify monitor andminimize risks as well as to identify business opportunities.
Risk evaluation and management is an ongoing process. As a process risks associatedwith the business are identified and prioritized based on the Company's overall riskappetite strategy severity and probability of occurrence.
The risk function is looked after by a team under CEO of the Company. Process ownersare identified for each risk and metrics are developed for continuous monitoring andminimization of risk.
The Board is satisfied that there are adequate systems and procedures in place toidentify assess monitor and manage risks. The Company has constituted a separate RiskManagement Committee on 16th May 2018 for overseeing all the risks that the Organizationfaces such as strategic financial marketing IT legal regulatory reputational andother risks and recommends suitable action. Risk mitigation policy has already beenapproved by the Board.
Total Quality Management (TQM)
TQM continues to be the backbone of the Company's approach for sustainable growththrough customer satisfaction. Continuous monitoring of performance measures and immediateactions to address such identified gaps have strengthened the process across the Company.
This year primary focus was on problem solving for recurrence prevention throughsystemic root-cause analysis. The Company has enhanced its executives and managers'problem-solving competency by certifying 111 of them in Green belt and Black belt in thecurrent year. On the whole 518 employees are now Green belt and Black belt certified. Allemployees have been involved towards achieving business goals. Significant contributionsfrom the highly committed workmen through suggestion schemes and Quality Control Circle(QCC) projects have yielded significant results in achieving Quality Cost Delivery (QCD)targets and eliminating unsafe incidents.
The Company continues to focus on all elements of cost. Raw materials components andconversion cost constitute major element of material cost. Focus on employee productivityand effectiveness of communication helps to reduce fixed cost of the Company.
Process improvement waste elimination and productivity improvements across the supplychain will continue to receive greater attention. The Company will pursue processinnovation value engineering and alternate sourcing to reduce material cost during thisyear.
Research & Development (R&D)
The continued pursuit of engineering excellence best-in- class quality and technologydevelopment by the Company's Research and Development (R&D) team has resulted indelivery of highly appealing new products during the year namely Apache RR 310 TVSNTORQ 125 and TVS Apache RTR 160 4V.
The team is continuously working on many advanced engine technologies to improve fuelefficiency performance and to meet future emission norms for international and domesticmarkets. The team is working towards timely readiness of the Company's product portfoliocompliant with BSVI emission norms. It continues to work on hybrid technology which hasreached a mature state and advanced brake systems technology for improved safety.
The R&D team continues their efforts in developing cutting- edge technologies thatare relevant for the near and long term future requirements of the Company's businessplans. These developments are centered on customers emerging needs of environment safetyand sustainability. The Company also collaborates with leading research establishments andeducational institutions both within and outside the Country to explore and developbreakthrough opportunities. The R&D team has so far published 110 technical papers innational and international conferences.
TVS Racing continues to add valuable inputs to the new product development byleveraging its advanced capabilities and racing experience. In the last year theCompany's racing team had 93% winning positions in the events that it participated. TVSRacing has won 14 out of 16 National championships.
Information Technology (IT)
The Company enhanced the customer engagement through mobile apps and digitizingcustomer touch points at dealerships. The Company also launched TVS NTORQ app with thefirst-of-its-kind connected scooter launched in February 2018.
The Company continues to implement several projects to improve its efficiencytransparency and process control across supply chain from dealer to supplier. Variousinitiatives on industry 4.0 are being adopted for improving quality and waste elimination.
As part of continuous improvement and benchmarking the Company's IT systems wereaudited by external experts and their recommendations were implemented. To enhanceinformation security various new IT security tools were implemented and periodic auditsare conducted by external experts and necessary control measures are being taken.
The Company is ISO 27001:2013 certified for all its manufacturing units and salesoffices. Business continuity plan for major business and design applications have beenimplemented and tested. The Company is apprised of Capability Maturity Model (CMM) level 3for its IT development process.
INTERNAL CONTROL AND THEIR ADEQUACY
The Company has a proper and adequate internal control system to ensure that all theassets of the Company are safeguarded and protected against any loss and that all thetransactions are properly authorized and recorded. Information provided to management isreliable and timely. Company ensures adherence to all statues.
Internal Financial Control
The Company has an established Internal Financial Control framework including internalcontrols over financial Reporting operating controls and anti-fraud framework. Theframework is reviewed regularly by the management and tested by an Independent Valuer andpresented to the Audit Committee. Based on the periodical testing the framework isstrengthened from time to time to ensure adequacy and effectiveness of InternalFinancial Controls.
Occupational Health & Safety (OHS)
The Company was conferred with "Environmental Leadership Award" fromGovernment of Himachal Pradesh in recognition of Company's outstanding contributiontowards environment protection conservation and sustainable development. The Company alsopublished its first Sustainability Report in accordance with CORE Reporting principles ofthe GRI G4 Guideline in public domain. Company's manufacturing plants are certified underrevised ISO 14001: 2015 standards.
Reducing environment footprint is the prime focus of the Company. Hosur and Mysuruplants have achieved Zero-Liquid Discharge (ZLD) by recycling and reusing of treated tradeeffluent. Following conservation measures have been adopted towards water conservationviz. water accounting waterless urinals dish washer in canteen and fully automaticvehicle wash system. The Company is continuously increasing the share of renewable energy.It was 64% during 2017-18 compared to 29% during 2016-17. These initiatives helped theCompany to reduce its Carbon foot print.
Hazardous wastes viz. paint sludge and chemical sludge are co-generated in cementfactory and onsite storage of hazardous waste in secured landfill is nil. Towardsabatement of Volatile Organic Compounds (VOC) Regenerative Thermal Oxidizer (RTO) hasbeen commissioned in Hosur & Mysuru plants.
The measurement of ambient VOC is made online to Care Air Centre of Tamil NaduPollution Control Board. Direct in-situ measurement of key parameters like pH; ChemicalOxygen Demand (COD); Biological Oxygen Demand (BOD); Total Suspended Solids (TSS) wereintroduced in Sewage Treatment Plant Hosur.
Towards digitization initiative forms and returns under applicable Environmental Actsand Rules were made online.
The Company has successfully completed 2nd surveillance audit in 4th re-certificationaudit process of Occupational Health & Safety System through implementation of BSOHSAS18001:2007 standard in Hosur & Mysuru plants. During the year as a part ofcontinual improvement in safety around 751 proactive hazard control measures have beenimplemented across Hosur Mysuru and Nalagarh Plants. The Plant Safety Rating System(PSRS) score improved from 195 to 211 and all plants have sustained "Gold"status. The Company has achieved a reduction of 53% in frequency rate of accidents &98% in severity rate of accidents. 13 lakh man-hours have been completed with "zeroinjury" during plant expansion civil construction activities at Hosur site last year.Towards building a sustainable safety culture periodical safety trainings have beenorganized and 15746 employees were covered. Also as a part of "Buckle up & Strapup" - Road Safety campaign around 300 test riders & drivers were trained on roadsafety.
HUMAN RESOURCE DEVELOPMENT (HRD)
Constituents of Human Resource Development framework followed by the Company includeWorkforce planning Employee Engagement Performance & Compensation ManagementLearning and Development Career & Succession Planning and Organization Development.Towards sustenance and delivering improved results these constituents have a structuredapproach policies and standard operating procedures which are reviewed and updatedperiodically.
Current and future skill-based competency development are planned and executed throughboth in-house programs and globally acclaimed programs continuing education challengingproject assignments and job rotations.
The Company continues to maintain its record of good industrial relations without anyinterruption in work. As on 31st March 2018 the Company had 5184 employees on its rolls.
Statements in the Management Discussion and Analysis Report describing the Company'sobjectives projections estimates and expectations may be "forward lookingstatements" within the meaning of applicable securities laws and regulations. Actualresults could differ materially from those expressed or implied. Important factors thatcould make a difference to the Company's operations include amongst others economicconditions affecting demand/ supply and price conditions in the domestic and overseasmarket in which the Company operates changes in the Government Regulations Tax Laws andOther Statutes and Incidental Factors.
5. DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with the provisions of Section 134(5) of the Act 2013 with respect toDirectors' Responsibility Statement it is hereby stated -
i. that in the preparation of annual accounts for the financial year ended 31st March2018 the applicable Accounting Standards had been followed along with proper explanationrelating to material departures if any;
ii. t hat the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that were 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 and of the profit of the Company for the year under review;
Hi. that the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
iv. that the Directors had prepared the annual accounts for the financial year ended31st March 2018 on a "going concern basis";
v. that the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
vi. that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
6. CORPORATE SOCIAL RESPONSIBILITY (CSR)
CSR activities have already been textured into the Company's value system throughSrinivasan Services Trust (SST) established in 1996 with the vision of buildingself-reliant rural community.
Over 22 years of service SST has played a pivotal role in changing lives of people inrural India by creating self-reliant communities that are models of sustainabledevelopment.
The Company is eligible to spend on their ongoing projects/ programmes falling withinthe CSR activities specified under the Act 2013 as mandated by the Ministry of CorporateAffairs for carrying out the CSR activities.
The Committee formulated and recommended a CSR Policy in terms of Section 135 of theAct 2013 along with a list of projects / programmes to be undertaken for CSR spending inaccordance with the Companies (Corporate Social Responsibility Policy) Rules 2014.
Based on the recommendation of the CSR Committee the Board has approved the projects /programmes carried out as CSR activities by the following non-profitable organizationshaving an established track record for more than the prescribed years in undertakingsimilar programmes / projects constituting more than 2% of the average net profits of theCompany made during the three immediately preceding financial years towards CSR spendingfor the financial year 2017-18 amounting to Rs.10.98 Cr:
|S.No ||Name of the Institution ||Amount spent (Rs. in Cr) |
|1. ||Srinivasan Services Trust (SST) ||7.08 |
|2. ||Sri Sathya Sai Central Trust ||3.00 |
|3. ||National Institute of Mental Health & Neuro Sciences (NIMHANS) ||0.65 |
|4. ||Voluntary Health Services ||0.25 |
| ||Total ||10.98 |
Presently SST is working in 5000 villages spread across Tamil Nadu KarnatakaMaharashtra Himachal Pradesh and Andhra Pradesh covering about 3092281 population and719890 families. Its major focus areas economic development health care qualityeducation environment and infrastructure.
Of the 5000 villages 3772 villages (2360138 population and 546806 families) havebeen funded by the Company during the year.
Achievements in 3772 villages are:
381801 families living in these villages have a monthly income of Rs.15000/-and above. They have financial security.
3846 Farmer groups have been formed with 53323 Members.
Improved agriculture practices enabled 231059 Farmers owning 251393hectares have increased the yields higher than the state average by 15%.
224805 families earn more than Rs 3500/- per month through livestock.
Formed 9692 Self Help Groups. These groups have 143821 women as Members.
Of the 143821 Members 140480 Members are in income generation activities.They earn a minimum income of Rs. 3000/- per month.
76945 children in the age group below 5 are not malnourished.
452930 women are freed from anaemia.
404589 households made access to toilet facilities.
The morbidity percentage reduced from 9% to 5%.
Enrolment in anganwadis increased from 86% to 100% and attendance is 99%.
1688 anganwadis have met all the Integrated Child Development Services Scheme(ICDS) standards.
88% involvement of mother volunteers in the functioning of anganwadis. Theyvolunteer their time to ensure proper functioning. Quality education:
100% enrolment of children in schools. There are no drop outs in the schools.
Number of percentage of slow learners reduced in schools from 29% to 11%.
Out of 1764 schools 1299 schools are now model schools.
114273 illiterate women out of 153493 have been made literates.
Environment and Infrastructure:
345140 households disposed solid waste through individual and common compostpits. 91 tons of vermi compost generated per month from wastes.
Sewage water from 348604 households disposed through soak pits kitchengardens and drain.
Safe drinking water is available to 3343 villages.
Community takes care of their development needs. 11639 social leaders are active inthis effort.
As required under Section 135 of the Act 2013 read with Rule 8 of the Companies(Corporate Social Responsibility Policy) Rules 2014 the Annual Report on CSR containingthe particulars of the projects / programmes approved and recommended by CSR Committee andapproved by the Board for the financial year 2017-18 are given by way of Annexure-IVattached to this Report.
7. PERFORMANCE OF SUBSIDIARIES & ASSOCIATE
The following companies and bodies corporate are the subsidiaries / associate of theCompany:
1. Sundaram Auto Components Limited Chennai
2. TVS Housing Limited Chennai
3. TVS Motor Services Limited Chennai
4. TVS Credit Services Limited Chennai
5. TVS Two-wheeler Mall Private Limited Chennai
6. TVS Micro Finance Private Limited Chennai
7. Harita ARC Private Limited Chennai
8. Harita Collection Services Private Limited Chennai
9. TVS Commodity Financial Solutions Private Limited Chennai
10. TVS Housing Finance Private Limited Chennai
11. TVS Motor Company (Europe) B.V. Amsterdam
12. TVS Motor (Singapore) Pte. Limited Singapore
13. PT TVS Motor Company Indonesia Jakarta
14. Sundaram Holding USA Inc Delaware USA
15. Green Hills Land Holding LLC South Carolina USA
16. Components Equipment Leasing LLC South Carolina USA
17. Sundaram-Clayton (USA) LLC South Carolina USA (Formerly known as WorkspaceProjects LLC)
18. Premier Land Holding LLC South Carolina USA Associate
- Emerald Haven Realty Limited Chennai and its subsidiaries.
Sundaram Auto Components Limited (SACL)
Sales of SACL grew 20% from Rs.480.9 Cr in the previous year to Rs.575.7 Cr in the year2017-18. Increase in business from the Company Autoliv and Daimler were the key growthdrivers.
SACL also entered into the area of component manufacturing of two-wheeler electricvehicle through orders obtained from Ather Energy and also cleared major customer auditsfor Ather energy MACE (for supplies to Maruti Suzuki) Gruppo Antolin Rane TRW and PSACitroen.
SACL earned a Profit Before Tax of Rs.24.52 Cr during the year 2017-18 as against Rs.34.94 Cr including exceptional items of Rs. 9.84 Cr in the previous year.
SACL at its meeting held on 2nd March 2018 declared an interim dividend of Rs.1.45 pershare (14.5%) on 35925000 equity shares of Rs.10/- each fully paid up absorbing a sumof Rs. 6.27 Cr including dividend distribution tax for the year ended 31st March 2018.
Equity Share Capital of SACL as on 31st March 2018 increased to Rs.35.92 Cr fromRs.14.55 Cr in the previous year.
During the year SACL allotted 21370000 equity shares of Rs.10 each at a premium ofRs.70 per share to the Company on rights basis in multiple tranches.
SACL proposes to demerge its automobile trading division alongwith its relevant assetsand liabilities to TVS Motor Services Limited (TVS MS).
Accordingly the Board of SACL approved a Scheme of Demerger at its meeting held on26th April 2018. Since both SACL and TVS MS are wholly owned subsidiaries of the Companyshares issued by TVS MS based on the valuation of the demerging division to the Company(TVS Motor Company Limited). For the transfer of the automobile trading division from SACLto TVS MS in accordance with the Scheme of Demerger will not change the status of bothsubsidiaries.
TVS Housing Limited (TVSH) / Emerald Haven Realty Limited (EHRL)
During the year TVS Housing Limited has earned a profit of Rs. 0.05 Cr on disposal ofexisting land bank.
EHRL through one of its subsidiary is developing 18 acres of land in KolapakkamChennai. The 1st phase consists of 352 apartments and 34 villas and the construction ofthe same has been completed. 72% of the apartments and 65% of the villas have been sold.Constructions of the other phases have commenced.
EHRL has also entered into a platform deal with a private equity investor to invest innew projects. Out of the platform deal 9.5 acres of land has been acquired near Porur inChennai. The building plan approval process for the land is in progress and the companyexpects to launch the project in first half of 2018-19.
EHRL through its another subsidiary has invested in a 2 acre land parcel in RadialRoad Chennai and the project to construct 279 apartments has been launched. During theyear EHRL has also acquired 6.5 acre parcel of land in OMR Chennai.
During the year EHRL earned a Profit Before Tax of Rs.6.56 Cr as against Rs. 5.36 Crin the previous year on a consolidated basis.
PT. TVS Motor Company Indonesia (PT TVSM)
The industry for the year 2017-18 witnessed growth of 5% over 2016-17 after 3 years ofdecline. While bebek segment and motorcycle segment suffered decline of 5% and 7%respectively matic segment grew by 8%.
For PT TVSM the total two-wheeler sales increased from 26756 vehicles in 2016-17 to37096 vehicles in 2017-18 fuelled by exports.
PT TVSM recorded an EBITDA loss of 3.72 Mn USD in 2017-18 compared to 3.15 Mn USD in2016-17.
TVS Motor Company (Europe) B.V & TVS Motor (Singapore) Pte. Ltd
TVSM had earlier incorporated both these entities with a view to serve as specialpurpose vehicles for making and protecting the investments made in overseas operations ofPT TVSM.
During the year under review Mr Rajesh Narasimhan Director of the Company wasappointed as the Chief Executive Officer of TVS Motor (Singapore) Pte Limited effective1st January 2018.
TVS Motor Services Limited (TVS MS)
During the year under review the Company acquired the entire equity share capital ofTVS MS on 7th September 2017.
In terms of Section 2(87) of the Act 2013 by this acquisition of entire equity sharesof TVS MS TVS Credit Services Limited (TVS CS) & its subsidiaries also becamesubsidiaries of the Company as mentioned below:
1. TVS Credit Services Limited
2. TVS Two Wheeler Mall Private Limited
3. TVS Micro Finance Private Limited
4. Harita ARC Private Limited
5. Harita Collection Services Private Limited
6. TVS Commodity Financial Solutions Private Limited
7. TVS Housing Finance Private Limited
TVS MS is the investment SPV of the Company for funding TVS CS. The Company acquiredNon-Cumulative Redeemable Preference shares (Preference Shares) of TVS MS held by Sundaram- Clayton Limited (SCL) and Lucas-TVS Limited (Lucas-TVS) on 18th December 2017 andthereby holds 100% of the Preference Share Capital of TVS MS.
The Company settled the consideration to SCL and Lucas-TVS by transferring its holdingin equity shares of TVS CS i.e 13517547 equity shares in aggregate to the saidcompanies based on the valuation report obtained from an Independent Valuer for theacquisition of Preference Shares.
TVS MS has filed a Scheme of Arrangement (Scheme) with National Company Law Tribunal(NCLT) for redemption of Preference Shares by transferring its holding in TVS CS.
As per the Scheme TVS MS will transfer its investment of 133651475 (Thirteen CroreThirty Six Lakhs Fifty One Thousand Four Hundred and Seventy Five) equity shares of Rs. 10(Rupees Ten) each in TVS CS (out of the total investment in 134741600 equity shares ofTVS CS held by TVS MS) to the Company in proportion of the Preference Shares holding inthe total paid-up capital of TVS MS.
On approval of the Scheme TVS CS a NBFC company will become a direct subsidiary ofthe Company. In this connection RBI has also issued No Objection letter for change in theshareholding pattern of TVS CS being a NBFC.
TVS Credit Services Limited (TVS CS)
TVS CS is the retail finance arm of the Company for financing two-wheelers. In linewith its long term vision of being preferred financier with diversified and profitableportfolio TVS CS added Consumer Durable & Used Commercial Vehicle Finance portfoliosduring the year 2017-18.
During the year 2017-18 TVS CS's overall disbursements registered a growth of 22% atRs. 4899 Cr as compared to Rs. 4007 Cr in the previous year. The assets under managementstood at Rs. 6152 Cr as against in single line i.e Rs. 5002 Cr during the previous yearregistering a growth of 23%. Total income during the financial year 2018 increased to Rs.1340.43 Cr from Rs. 1114.79 Cr during the financial year 2016-17 an increase of 20.2%over the previous year.
The Profit Before Tax for the year has also improved and stood at Rs. 169.88 Cr asagainst Rs. 135.56 Cr during the previous year with a growth rate of 25%.
The subsidiaries of TVS CS are yet to commence their operations.
Sundaram Holding USA Inc. (SHUI) & its subsidiaries
SACL along with the holding company viz. Sundaram- Clayton Limited has madeinvestment in SHUI a company established under the applicable provisions of Laws of TheUnited States of America.
SHUI's wholly owned subsidiaries are:
1. Green Hills Land Holding LLC South Carolina USA
2. Component Equipment Leasing LLC South Carolina USA
3. Sundaram-Clayton USA LLC South Carolina USA (Formerly known as Workspace ProjectLLC)
4. Premier Land Holding LLC South Carolina USA
During the year 2017-18 SACL has invested a sum of USD 20399250 in the ordinaryshares of SHUI and holds 75% of the total capital of SHUI as on 31st March 2018.
SHUI has acquired land in Dorchester County USA for its plant where it willmanufacture High Pressure Die Cast and Gravity Cast parts. Construction at site is inprogress and commercial production is expected to commence towards the end of the year2018-19.
The loss after tax for the financial year ended 31st March 2018 was USD 2278295 asagainst USD 939237 in the previous year ended 31st March 2017 due to pre-productionexpenses.
8. CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements of the Company are prepared in accordance withthe provisions of Section 129 of the Act 2013 read with the Companies (Accounts) Rules2014 and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (LODR) along with a separate statement containing the salient features ofthe financial performance of subsidiaries I associates in the prescribed form. The auditedconsolidated financial statements together with Auditors' Report form part of the AnnualReport.
The audited financial statements of the subsidiary companies will be made available tothe Shareholders on receipt of a request from any Shareholder and it has also been placedon the website of the Company. This will also be available for inspection by theShareholders at the Registered Office during business hours as mentioned in the Notice ofAGM.
The consolidated Profit Before Tax of the Company and its subsidiaries & associateamounted to Rs. 931 Cr for the financial year 2017-18 as compared to Rs. 658 Cr in theprevious year.
9. DIRECTORS & KEY MANAGERIAL PERSONNEL Independent Directors (IDs)
All IDs hold office for a fixed term of five years and are not liable to retire byrotation.
At the annual general meeting held on 14th July 2014 M/s T Kannan R Ramakrishnan C RDua Prince Asirvatham and Hemant Krishan Singh were appointed as IDs for the first termof five consecutive years from the conclusion of the twenty second Annual General Meetingand to receive remuneration by way of fees reimbursement of expenses for participation inthe meetings of the Board and / or Committees and profit related commission in terms ofapplicable provisions of the Act 2013 as determined by the Board from time to time.
On appointment each ID has acknowledged the terms of appointment as set out in theirletter of appointment. The terms cover inter-alia duties rights to access informationdisclosure of their interest / concern dealing in Company's shares remuneration andexpenses insurance and indemnity. The IDs are provided with copies of the Company'spolicies and charters of various Committees of the Board.
In accordance with Section 149(7) of the Act 2013 all IDs have declared that they metthe criteria of independence as provided under Section 149(6) of the Act 2013.
The detailed terms of appointment of IDs is disclosed on the Company's website in thefollowing link http://www.tvsmotor. com/pdf/Terms-of-Appointment-Independent-Directors.pdf
Separate meeting of Independent Directors
During the year under review a separate meeting of IDs was held on 26th February 2018and all the IDs were present at the Meeting.
Based on the set of questionnaires complete feedback on Non-Independent Directors anddetails of various activities undertaken by the Company were provided to IDs to facilitatetheir review / evaluation.
a) Non-Independent Directors (Non-IDs)
IDs used various criteria and methodology practiced in Industry prescribed byNomination and Remuneration Committee (NRC) for evaluation of Non-IDs viz. M/s VenuSrinivasan Chairman and Managing Director Sudarshan Venu Joint Managing Director HLakshmanan Dr. Lakshmi Venu and Rajesh Narasimhan Directors Chairman of the Board andBoard as a whole.
IDs evaluated the performance of all Non-IDs individually through a set ofquestionnaires. They reviewed their interaction during the Board / Committee meetings andstrategic inputs given by them to improve the risk management internal controls andcontribution to the Company's growth.
IDs were satisfied fully with the performance of all Non-IDs.
The IDs reviewed the performance of Chairman of the Board after taking into account hisperformance and benchmarked the achievement of the Company with industry under thestewardship of Chairman.
The IDs also placed on record their appreciation of Chairman's visionary leadership;setting tone pace and opportunity for positive change and passion for constantimprovement and admired the high standards of integrity and probity quality and adequacyof leadership of Chairman and his versatile performance.
The IDs also endorsed that the Chairman is a very accomplished leader and isexceptionally well informed about the state of economy.
The IDs also evaluated Board's composition size mix of skills and experience itsmeeting sequence effectiveness of discussion decision making follow up action so as toimprove governance and enhance personal effectiveness of Directors.
The evaluation process focused on Board Dynamics and upon evaluation IDs concludedthat Board is well balanced in terms of diversity of experience with expert in each domainviz. Engineering Finance Marketing Legal Information Technology Administration andInternational Economy. The Company has a Board with wide range of expertise in all aspectsof business.
The IDs unanimously evaluated the pre-requisites of the Board viz. formulation ofstrategy acquisition & allocation of overall resources setting up policiesdirectors' selection process and cohesiveness on key issues and satisfied themselves thatthey were adequate.
They were satisfied with the Company's performance in all fronts and finally concludedthat the Board operates with global best practices.
d) Quality Quantity and Timeliness of flow of information between the CompanyManagement and the Board
All IDs have expressed their overall satisfaction with the support received from themanagement and the excellent work done by the management during the year under review andalso the relationship between the top management and Board is smooth and seamless.
Directors appointment / re-appointment
In terms of the provisions of sub-section (6) read with explanation to Section 152 ofthe Act 2013 two-thirds of the total number of Directors i.e. excluding IDs are liableto retire by rotation and out of which one-third is liable to retire by rotation at everyannual general meeting.
Dr. Lakshmi Venu and Mr H Lakshmanan are liable to retire by rotation at AGM andbeing eligible offer themselves for re-appointment.
As per the recent amendment to SEBI (LODR) Regulations with effect from 1st April2019 the appointment or continuation by a person as a Non-Executive Director who attainedthe age of 75 years requires a special resolution of the Shareholders.
The tenure of Mr H Lakshmanan NE-ID of the Company aged 84 years who is liable toretire by rotation at the ensuing AGM continues beyond 1st April 2019 uponre-appointment and hence sought approval of the shareholders through Special Resolution.
Considering his six decades of experience in the Group the Board recommended hisre-appointment to the Shareholders based on the performance evaluation by NRC.
Mr Rajesh Narasimhan was appointed as an Independent Director on 11th August 2017 andceased as Independent Director effective 31st October 2017 consequent to his proposedappointment as Chief Executive Officer in TVS Motor (Singapore) Pte Limited a whollyowned subsidiary of the Company.
On 1st November 2017 the Board appointed Mr Rajesh Narasimhan as an AdditionalDirector to hold office upto the date of ensuing AGM and proposed his appointment as aDirector liable to retire by rotation.
The Shareholders have also approved his appointment in the place of profit as requiredunder Section 188 of the Act 2013 through Postal Ballot on 21st December 2017.
The Directors have recommended their appointment / re-appointment for the approval ofShareholders. Brief resume of the Directors are furnished in the Notice convening the AGMof the Company.
Key Managerial Personnel (KMP)
Joint Managing Director:
During the year under review Mr Sudarshan Venu was reappointed as the Joint ManagingDirector of the Company for a further period of five years commencing from 1st February2018 and the Shareholders have approved the same through Postal Ballot on 21st December2017.
Change in Chief Financial Officer:
During the year under review Mr S G Murali retired as Chief Financial Officer of theCompany on 25th September 2017 upon reaching superannuation and Mr K Gopala Desikan wasappointed as the Chief Financial Officer effective 1st November 2017 based on therecommendation of the Nomination and Remuneration Committee and Audit & RiskManagement Committee.
Mr Venu Srinivasan Chairman and Managing Director Mr Sudarshan Venu Joint ManagingDirector Mr K N Radhakrishnan Chief Executive Officer Mr K Gopala Desikan ChiefFinancial Officer and Mr K S Srinivasan Company Secretary are KMP of the Company in termsof Section 2(51) and Section 203 of the Act 2013 as on date of this Report.
Nomination and Remuneration Policy
The Nomination and Remuneration Committee of Directors (NRC) reviews the composition ofthe Board to ensure an appropriate mix of abilities experience and diversity to serve theinterests of all Shareholders of the Company.
Nomination and Remuneration Policy was approved by the Board at its meeting held on23rd September 2014 and amended at the Board meeting held on 16th May 2018 in terms ofSection 178 of the Act 2013. The objective of such policy shall be to attract retain andmotivate executive management and devise remuneration structure to link to Company'sstrategic long term goals appropriateness relevance and risk appetite.
NRC will identify ascertain the integrity qualification appropriate expertise andexperience having regard to the skills that the candidate will bring to the Board /Company whenever the need arises for appointment of Directors / KMP / SMP.
Criteria for performance evaluation disclosures on the remuneration of Directorscriteria of making payments to Non-Executive Directors have been disclosed as part ofCorporate Governance Report attached herewith.
Remuneration payable to Non-Executive Independent Directors
The Shareholders at the 20th AGM of the Company held on 12th September 2012 approvedthe remuneration by way of commission not exceeding 1% of the Net profits in aggregatepayable to the Non-Executive Independent Directors of the Company (NE-IDs) for every yearfor a period of 5 years commencing from 1st April 2013 to 31st March 2018.
NE-IDs devote considerable time in deliberating the operational and other issues of theCompany and provide valuable advice in regard to the management of the Company from timeto time and the Company also derives substantial benefit through their expertise andadvice.
In view of the increased involvement and participation by such NE-IDs and having regardto their contribution and involvement in policy issues concerning the Company'soperations the Company based on the recommendations of NRC and the Board at the AGMheld on 11th August 2017 the Shareholders by way of a special resolution have renewedthe payment of commission to NE-IDs on similar terms for each financial year effective1st April 2018.
Evaluation of the Independent Directors and Committees of Directors
In terms of Section 134 of the Act 2013 and the Corporate Governance requirements asprescribed under SEBI (LODR) Regulations 2015 the Board reviewed and evaluatedIndependent Directors and its Committees viz. Audit & Risk Management CommitteeNomination and Remuneration Committee Corporate Social Responsibility Committee andStakeholders' Relationship Committee based on the evaluation criteria laid down by theNRC.
The Board concurred with the recommendations made by the NRC on the evaluation ofNon-IDs based on the views expressed at the IDs' meeting held on 26th February 2018.
Hence the Board carried out the evaluation of IDs (excluding the ID being evaluated)and the Board appointed Committees through a set of questionnaires.
The performance of all IDs was assessed against a range of criteria such ascontribution to the development of business and performance of the Company understandingthe major risks affecting the Company clear direction to the management and contributionto the Board cohesion. The performance evaluation has been done by the entire Board ofDirectors except the Director concerned being evaluated.
The Board noted that all IDs have understood the opportunities and risks to theCompany's strategy and are supportive of the direction articulated by the management teamtowards consistent improvement.
Board delegates specific mandates to Board constituted Committees to optimizeDirectors' skills and talents besides complying with key regulatory aspects.
- Audit and Risk Management Committee for overseeing financial Reporting;
- Nomination and Remuneration Committee for selecting and compensating Directors /Employees;
- Stakeholders' Relationship Committee for redressing investors grievances; and
- Corporate Social Responsibility Committee for overseeing CSR initiatives andinclusive growth.
The performance of each Committee was evaluated by the Board after seeking inputs fromits Members on the basis of specific terms of reference its charter time spent by theCommittees in considering key issues quality of information received majorrecommendations / action plans and work of each Committee.
The Board was satisfied with the overall effectiveness and decision making of allCommittees. The Board reviewed each Committee's terms of reference to ensure that theCompany's existing practices remain appropriate. Recommendations from each Committee areconsidered and approved by the Board prior to implementation.
Risk Management Committee
The Company occupied the position as one of the Top 100 listed companies as at 31stMarch 2018 and accordingly the Board constituted a separate Risk Management Committee on16th May 2018 as required under the SEBI (LODR) Regulations 2015. The details ofcomposition of Committee and its charter is discussed in the Corporate Governance Reportattached to this Report.
Details of all other Committees its charter functions are provided in the CorporateGovernance Report attached to this Report.
Number of Board meetings held
The number of Board meetings held during the financial year 2017-18 is provided as partof Corporate Governance Report attached to this Report.
10. AUDITORS Statutory Auditors
The Company at its twenty second AGM held on 14th July 2014 appointed M/s V. SankarAiyar & Co. Chartered Accountants Mumbai having Firm Registration No. 109208Wallotted by The Institute of Chartered Accountants of India as Statutory Auditors of theCompany to hold office for four consecutive years in the first term of five consecutiveyears from the conclusion of the said AGM subject to ratification at every AGM at suchremuneration in addition to applicable taxes out of pocket expenses travelling and otherexpenses as may be mutually agreed between the Board of Directors of the Company and theAuditors.
In terms of the above provisions M/s V. Sankar Aiyar & Co Chartered Accountantshave completed their first term of five consecutive years.
It is therefore proposed to re-appoint them as Statutory Auditors for the second termof five consecutive years from the conclusion of the ensuing AGM till the conclusion ofthe 31st AGM of the Company.
The Company has obtained necessary certificate under Section 141 of the Act 2013conveying their eligibility for being the Statutory Auditors of the Company for the year2018-19.
The Auditors' Report for the financial year 2017-18 does not contain any qualificationreservation or adverse remark and the same is attached with the annual financialstatements.
As required under Section 204 of the Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company is required to appoint aSecretarial Auditor for auditing secretarial and related records of the Company.
As required by Section 204 of the Act 2013 the Secretarial Audit Report for the year2017-18 of M/s S Krishnamurthy & Co. Company Secretaries Chennai is attached tothis Report. The said Secretarial Audit Report does not contain any qualificationreservation or other remarks.
The Board at its meeting held on 16th May 2018 has re-appointed M/s. S Krishnamurthy& Co. Practising Company Secretaries Chennai having Registration No.2215 allotted bythe Institute of Company Secretaries of India as Secretarial Auditors for the financialyear 2018-19.
As per Section 148 of the Act 2013 read with the Companies (Cost Records and Audit)Rules 2014 as amended the cost audit records maintained by the Company in respect of itsengine components manufactured by the Company specified under Customs Tariff Act headingin Table B to Rule 3 of the above rules are required to be audited by a Cost Auditor.
In terms of the Companies (Cost Records and Audit) Amendment Rules 2014 the Board hasre-appointed Mr A N Raman Cost Accountant holding Certificate of Practice No. 5359allotted by The Institute of Cost Accountants of India as the Cost Auditor for conductingCost Audit for the financial year 2018-19.
The Company has also received necessary certificate under Section 141 of the Act 2013from him conveying his eligibility to act as a Cost Auditor. A sum of Rs.5 lakhs has beenfixed by the Board as remuneration in addition to reimbursement of travelling andout-of-pocket expenses and all applicable taxes for the year 2018-19 which is required tobe ratified by the Members at the ensuing AGM as per Section 148(3) of the Act 2013.
The Company has filed the Cost Audit Report of 2016-17 on 7th September 2017 in XBRLformat.
11. CORPORATE GOVERNANCE
The Company has been practicing the principles of good corporate governance over theyears and lays strong emphasis on transparency accountability and integrity.
A separate Section on Corporate Governance and a certificate from the StatutoryAuditors of the Company regarding compliance of conditions of Corporate Governance asstipulated under SEBI (LODR) Regulations 2015 form part of this Annual Report.
The Chairman and Managing Director and the Chief
Financial Officer of the Company have certified to the Board on financial statementsand other matters in accordance with Regulation 17(8) of SEBI (LODR) Regulations 2015pertaining to CEO/CFO certification for the financial year ended 31st March 2018.
12. BUSINESS RESPONSIBILITY REPORT
In terms of Regulation 34 of the SEBI (LODR) Regulations 2015 the BusinessResponsibility Report for the year 2017-18 describing the initiatives taken from anenvironment social and governance perspective in the prescribed format is given asAnnexure-VIII to this Report.
13. POLICY ON VIGIL MECHANISM
The Company has adopted a Policy on Vigil Mechanism in accordance with the provisionsof Companies Act 2013 and Regulation 22 of SEBI (LODR) Regulations 2015 which providesa formal mechanism for all Directors Employees and other Stakeholders of the Company toreport to the management their genuine concerns or grievances about unethical behaviouractual or suspected fraud and any violation of the Company's Code of Business Conduct andEthics.
The Code also provides a direct access to the Chairman of the Audit Committee to makeprotective disclosures to the management about grievances or violation of the Company'sCode.
The Board at its meeting held on 16th May 2018 has made an amendment to the WhistleBlower Policy for reporting any allegations of material nature on Directors / Employeeswithin a reasonable time limit from the occurrence of such events.
The Policy is disclosed on the Company's website in the following linkhttps://www.tvsmotor.com/pdf/Whistle-Blower- Policy-2018.pdf.
14. PUBLIC DEPOSITS
The Company has not accepted any deposit from the public within the meaning of Section76 of the Act 2013 for the year ended 31st March 2018.
15. STATUTORY STATEMENTS
Information on conservation of energy technology absorption foreign exchange etc:
Relevant information is given in Annexure-I to this Report in terms of therequirements of Section 134(3)(m) of the Act 2013 read with the Companies (Accounts)Rules 2014.
Material changes and commitments:
There have been no material changes and commitments affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of this Report.
Significant and material orders passed by the Regulators or Courts or Tribunalsimpacting the going concern status of the Company:
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.
Extract of the Annual Return in prescribed form is given as Annexure-II to this Reportin terms of the requirements of Section 134(3) of the Act 2013 read with the Companies(Accounts) Rules 2014.
Details of Employees receiving the remuneration in excess of the limits prescribedunder Section 197 of the Act 2013 read with Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed as a statement and given inAnnexure-III. In terms of first proviso to Section 136(1) of the Act 2013 the AnnualReport excluding the aforesaid annexure is being sent to the Shareholders of the Company.The annexure is available for inspection at the Registered Office of the Company duringbusiness hours as mentioned in the Notice of AGM and any Shareholder interested inobtaining a copy of the said annexure may write to the Company Secretary at the RegisteredOffice of the Company.
Comparative analysis of remuneration paid:
A comparative analysis of remuneration paid to Directors and Employees with theCompany's performance is given as Annexure-V to this Report.
Details of material related party transactions:
Details of material related party transactions under Section 188 of the Act 2013 readwith the Companies (Meetings of
Board and its Powers) Rules 2014 are given in Annexure- VI to this Report in theprescribed form.
Details of loans / guarantees / investments made:
The details of loans and guarantees under Section 186 of the Act 2013 read with theCompanies (Meetings of Board and its Powers) Rules 2014 for the financial year
2017-18 are given as Annexure-VII to this Report. On loans granted to the Employeesthe Company has charged interest as per its remuneration policy in compliance withSection 186 of the Act 2013.
Please refer note No. 3 to Notes on accounts for the financial year 2017-18 fordetails of investments made by the Company.
Reporting of fraud:
The Auditors of the Company have not reported any fraud as specified under Section143(12) of the Act 2013.
During the year under review the Company has not received any complaints in terms ofSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
The Directors gratefully acknowledge the continued support and co-operation receivedfrom the holding Company viz. Sundaram-Clayton Limited. The Directors thank the bankersinvesting institutions customers dealers vendors and sub-contractors for their valuablesupport and assistance.
The Directors wish to place on record their appreciation of the good work done by allthe employees of the Company during the year under review.
The Directors also thank the investors for their continued faith in the Company.
|For and on behalf of the Board of Directors || |
|Chennai ||Venu Srinivasan |
|16th May 2018 ||Chairman |