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Uni Abex Alloy Products Ltd.

BSE: 504605 Sector: Engineering
NSE: N.A. ISIN Code: INE361D01012
BSE 00:00 | 24 Jun 553.45 -11.30
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NSE 05:30 | 01 Jan Uni Abex Alloy Products Ltd
OPEN 579.90
PREVIOUS CLOSE 564.75
VOLUME 731
52-Week high 677.00
52-Week low 313.20
P/E 10.22
Mkt Cap.(Rs cr) 110
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Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 579.90
CLOSE 564.75
VOLUME 731
52-Week high 677.00
52-Week low 313.20
P/E 10.22
Mkt Cap.(Rs cr) 110
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Uni Abex Alloy Products Ltd. (UNIABEXALLOY) - Director Report

Company director report

To

The Members

The Directors have pleasure in presenting herewith the Forty Seventh Annual Reporttogether with the Audited Accounts of the Company for the year ended March 312020.

OPERATIONS AND FINANCIAL RESULTS

SUMMARY OF FINANCIAL RESULTS AS PER IND-AS

(Figures in 'Lakhs)

Particulars 2019-20 2018-19
Revenue from Operations 10242.51 8986.07
Add: Other income 133.23 77.62
Total income 10375.74 9063.69
Profit / (loss) before Depreciation 1766.04 1315.10
Less: Depreciation 471.27 467.13
Profit / (Loss) Before Tax 1294.77 847.97
Less : Income Tax for Current Year 224.55 190.00
Less: Income Tax adjustment for previous years -
Less: Deferred Tax adjustment 534.02 (282.99)
Add: Other Comprehensive Income / (Loss) 10.72 (3.13)
Profit / (Loss) After Tax 546.92 937.83
Balance brought forward 2865.15 2105.92
Profit Available for Appropriation 3412.07 3043.73
Proposed Dividend on Equity Shares 98.75 148.13
Dividend Tax on the above NIL 30.45
Transferred to General Reserve NIL NIL

DIVIDEND / RESERVES

Your Directors recommend a dividend of ' 5/- per Equity share of nominal value of Rs.10each (i.e. 50%) for the year ended March 312020 as against Rs.7.50/- (i.e. 75%) paid forthe previous year. The total outgo towards dividend on equity shares amounts to Rs.98.75Lakhs. Your Directors have decided not to transfer any amount to the Reserves for the yearunder review.

OPERATIONS

Overall economic slowdown also impacted the order book of your accompany in this year.OEM segments in general and separation industry in particular was in a sluggish mode thisyear. This impacted order intake for the year. Deferment of tenders in refineries also hadan adverse impact in this fiscal. Your company added few new accounts which show potentialto grow in future. Owing to a strong order book of previous fiscal company achievedhighest ever sales turnover in this year at Rs.98.64 Crs. with effective operationalmanagement and some innovative cost management through process improvements your companymanaged to counter the impact of inflation.

PBIDT for the year under review is Rs.20.18 Crs as against Rs. 16.97 Crs of theprevious year.

Your Company reported a profit after tax of Rs.5.47 Crs in the current fiscal asagainst Rs.9.38 Crs during the last year.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate system of internal controls in all spheres of itsoperations which are commensurate with the size and the nature of its business. YourCompany has in place adequate controls on resource utilization and provision of accurateand speedy financial statements. The Company ensures compliance with policies andprocedures and other statutory and legal obligations on an ongoing basis. Your Company'sInternal Financial Controls on its entire processes have been vetted by the StatutoryAuditors. Internal control is supplemented by effective and independent internal audit.Management regularly reviews the findings of the Internal Auditors and ensures effectiveimplementation of suggestions/observations of the Internal Auditors. In addition theAudit Committee of the Board regularly addresses significant issues raised by the Internaland the Statutory Auditors.

PROSPECTS

Prolonged lockdown of all business and manufacturing operations worldwide due toCovid-19 and its aftermath in the form of liquidity crunch have impacted the economyseverely both domestically and internationally. The working of the Company for the fiscalyear 2020-21 will be severely constrained. Nevertheless your Directors are reasonablyoptimistic of riding the tide by innovative strategies and proactive focus onopportunities beyond the OEM segment.

QUALITY MANAGEMENT

The Company has set high benchmarks on quality and on on-time delivery providing acompetitive edge in current business scenario. The Company's operations continued to becertified to ISO 9001:2015.

ENVIRONMENT HEALTH AND SAFETY

As a part of its commitment toward environment the Company has developed anEnvironmental Management System along with work practices to ensure high level of safetyhealth and environment standards. The Company and all its offices and factory have beenfully compliant with the Central Government and the State Government directives onlockdown to combat Covid-19. The Company's operations continue to be certified to ISO14001:2015 and OHSAS 18001:2007.

HUMAN RESOURCE MANAGEMENT

Skill development and training both behavioural and domain based are ongoing exercisesthrough focused HR processes. Relations between employees and the management continue toremain cordial.

MATERIAL DEVELOPMENTS ON HUMAN RESOURCES INCLUDING NUMBER OF PEOPLE EMPLOYED

As on 31st March 2020 the total numbers of permanent employees on thepayrolls of the Company at all the locations was 95.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The information required pursuant to Section 197(12) read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 forms part of thisreport. In terms of Section 136 of the Act the Report and Accounts are being sent to theMembers and others entitled thereto excluding the information on employees' particularswhich is available for inspection by the Members up to the date of the ensuing AnnualGeneral Meeting. If any Member is interested in obtaining a copy thereof such Member mayemail to the Company in this regard.

PARTICULARS OF DIRECTORS' REMUNERATION:

The ratio of the remuneration of each director to the median remuneration of theemployees

Sr. No. Name of Director and Designation Remuneration of Director for financial year 2019-20 Previous year's Remuneration includes sitting Fees % increase/ decrease in Remuneration over the Financial year 2018-19 Ratio of Remuneration of each Director to median remuneration of employees Comparison of the remuneration of the KMP against the performance of the Company
1 F. D. Neterwala - Chairman 410000 400000 2.5% 0.75 : 1.00 -
2 R. B. Mehta - Director 100000 120000 -16.67% 0.18 : 1.00 -
3 A. F. Neterwala - Director 160000 200000 -20.00% 0.29 : 1.00 -
4 P. F. Neterwala - Director 50000 100000 -50% 0.09 : 1.00 -
5 M. K. Fondekar - Director 200000 200000 0.00% 0.37 : 1.00 -
6 H. R. Prasad - Director 440000 430000 2.33% 0.81 : 1.00 -
7 F. K. Banatwalla - Director 430000 430000 0.00% 0.79 : 1.00 -
8 Jimmy Parakh - Director 200000 410000 -51.22% 0.37 : 1.00 -

The sitting fees per Board Meeting attended is Rs.50000/- as also for each meeting ofthe Audit Committee attended. For attending all other Committee Meetings the fees permeeting is Rs.10000/- (except Stakeholders Relationship Committee where no fee is paid).

PARTICULARS OF REMUNERATION OF KEY MANAGERIAL PERSONNEL:

The percentage increase in remuneration of: • Chief Executive Officer 13.50%
• Chief Financial Officer 12.50%
• Company Secretary 9.7%
• Median remuneration of employees 11.6%
Number of permanent employees on the rolls of company 95 (As on 31st March 2020)
Average percentage increase made in the salaries of employees other than the key managerial personnel in the last financial year i.e. 2019-20. 13.1%
Affirmation that the remuneration is as per the remuneration policy of the company It is hereby affirmed that the remuneration paid is as per the remuneration policy for Directors Key Managerial personnel and other employees.

DIRECTORS

a) In terms of the provisions of Section 149 150 152 and other applicable provisionsof the Companies Act 2013 and the Rules made thereunder:

i. Mr. H.R. Prasad and Mr. F.K. Banatwalla were re-appointed as Independent Directorsfor the second term of five years commencing from 01.04.2019 and ending 31.03.2024 byPostal Ballot.

ii. Mr. M.K. Fondekar was appointed as an Independent Director for the first term offive years at the 46th Annual General Meeting of the Company held on 8thAugust 2019 to hold office up to 08.08.2024.

b) Purssuant to the provisions of Section 152(6) of the Companies Act 2013 and theRules made thereunder Mr. F.D. Neterwala and Mrs. P.F. Neterwala retire by rotation atthe ensuing General Meeting and are eligible for re-appointment.

c) Pursuant to the Provisions of Regulation 17(1A) of the Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 continuationof tenure of Mr. R. B. Mehta on attaining the age of 75 years is proposed for the approvalof members at the ensuring General Meeting.

COMMITTEES OF THE BOARD

In terms of the provisions of the Companies Act 2013 as applicable to ListedCompanies the following Committees of the Board have been duly constituted

I. Audit Committee:

The Audit Committee Members as at March 312020 comprised of:

Name of Director Category
Mr. F. K. Banatwalla Chairman & Independent Director
Mr. F. D. Neterwala Promoter - Non Executive Director
Mr. H. R. Prasad Independent Director
Mr. Jimmy Parakh Independent Director

The information generally provided to the Committee for its consideration and approvalsinclude:

- Quarterly half yearly and annual financial results of the Company and performancereport on its business segments;

- Annual budget and performance targets;

- Appointment of statutory and internal auditors;

- Appointment of key managerial personnel;

- Review of foreign exchange exposures and exchange rate movement if material;

- Contracts in which Director(s) are interested or deemed to be interested;

- Defaults in payment of statutory dues if any;

- Related party transactions;

- Compliance of various laws and Indian Accounting Standards - IND-AS;

- Any remarks/ observances/ findings made by the Statutory and Internal Auditors of theCompany;

- Making of loans and investment of surplus funds;

- Whistle blower policy /vigil mechanism

During the Financial Year 2019-20 4 Meetings of the Audit Committee were held.

II. Nomination and Remuneration Committee:

The Nomination and Remuneration Committee as at March 312020 comprised of:

Name of Director Category
Mr. H. R. Prasad Chairman & Independent Director
Mr. R. B. Mehta Promoter - Non Executive Director
Mr. F. K. Banatwalla Independent Director

The Committee frames the Remuneration Policy and recommends remuneration / revision /merit increment and related matters in respect of Chief Executive Officer Chief FinancialOfficer Company Secretary and Senior Executives.

During the year 2019-2020 two meetings of the Nomination and Remuneration Committeewere held.

III. Stakeholders Relationship Committee

The composition of the Stakeholders Relationship Committee as at March 312020 is asunder:

Name of the Director Category
Mr. F. D. Neterwala Non-Executive Director
Mr. R. B. Mehta Non-Executive Director
Mr. A. F. Neterwala Non-Executive Director
Mr. Jimmy Parakh Independent Director

The Committee meets as often as necessary. In accordance with the authority granted bythe Board the Stakeholders Relationship Committee deals with the following mattersconcerning shareholders on fortnightly basis:

- Transfer/Transmission/Deletion/Name change of physical shares

- Split/Sub-division consolidation and duplicate share certificates of physical sharesas approved by the Board. Re-materialization of Shares.

IV. Corporate Social Responsibility Committee (CSR):

The composition of the CSR Committee as at March 312020 is as under:

Name of the Director Category
Mr. F. D. Neterwala Non-Executive Director
Mr. H. R. Prasad Independent Director
Mr. A. F. Neterwala Non-Executive Director

The Committee frames the CSR Policy of the Company; identifies the projects which theCompany can undertake towards the CSR initiatives and recommends the same to the Board ofDirectors for its approval.

One meeting of the CSR Committee was held during the year.

BOARD MEETINGS:

During the period from 1st April 2019 to 31st March 2020 fourmeetings of the Board were held as under:

- 28th May 2019

- 13th August 2019

- 13th November 2019

- 13th February 2020

BOARD EVALUATION:

The formal procedure for evaluation by the Board of its own performance and that of itsCommittee and Individual Directors was done.

The meeting of the Independent Directors of the Company was held on 28thMay 2019.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3) (c) and 134 (5) of the Companies Act 2013 the Directorsbased on the representations received from the Operating Management confirm that:

(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed and that there are no material departures;

(b) In consultation with the Statutory Auditors appropriate accounting policies havebeen selected and applied consistently and judgments and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 312020 and of the profit for year ended on that date;

(c) To the best of their knowledge and ability proper and sufficient care has beentaken for the maintenance of adequate accounting records in accordance with the applicableprovisions of the Companies Act 2013 for safeguarding the assets of the Company and forpreventing and detecting fraud and other irregularities if any;

(d) The annual accounts have been prepared on a going concern basis.

(e) The Directors have laid down internal financial controls in respect of policies andprocedures adopted by the Company for ensuring the orderly and efficient conduct of itsbusiness including adherence to the Company's policies the safe guarding of its assetsthe accuracy and completeness of the accounting records and timely preparation of reliablefinancial information and such internal controls are adequate and were operatingeffectively.

(f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively

KEY MANAGERIAL PERSONNEL

Your Directors regret to report the sad and sudden demise of Mr. Milind Ashar theCompany Secretary and Compliance Officer on 12th December 2019.

Pursuant to the provisions of Section 203 of the Companies Act 2013 Mr. Bhautesh Shahhas been appointed as the Company Secretary and Compliance Officer with effect from 14thMay 2020 by the Board of Directors at its meeting held on 29th June 2020.

ABSTRACT OF ANNUAL RETURN:

Pursuant to the provision of Section 134 (3) (a) of the Companies Act 2013 an abstractof the Annual Return for 2019-20 in the prescribed format is attached (Annexure I) andforms an integral part of the Report.

DECLARATION BY INDEPENDENT DIRECTORS:

Pursuant to Section 149 (7) of the Companies Act 2013 each of the Independent Directorof the Company has given a declaration at the Board Meeting to the effect that he meetsthe criteria of Independence as provided in Section 149 (6) of the Companies Act 2013.

COMPANY'S POLICY ON DIRECTORS APPOINTMENT REMUNERATION ETC:

The Nomination and Remuneration Committee of the Board is evolving a policy onappointment and remuneration and other matters as provided in Section 178 (3) of theCompanies Act 2013. Any further appointment of executive Director and his remuneration orappointment of an Independent Director would be based on the policy that is being evolved.

PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:

The Company has not provided any loans or given any guarantee / security to any person.

Details of working Capital facilities and Term Loans obtained by the Company areprovided in the Notes no 21 and 18 in the Notes to financial statement. Details ofinvestment made by the Company are provided in Note no 7 in the Notes to FinancialStatements under Investment Schedule. These Investments are made by the Company inordinary course of business out of the surplus funds presently available with theCompany with a view to get an effective return.

PARTICULARS OF CONTRACTS AND ARRANGEMENTS COVERED UNDER SECTION 188 OF THE COMPANIESACT 2013:

Your Company has formulated a policy on related party transactions. This policy dealswith the review and approval of related party transactions. The Board of Directors of theCompany has approved the criteria for making the omnibus approval by the Audit Committeewithin the overall framework of the policy on related party transactions. Prior omnibusapproval is obtained for related party transactions which are of repetitive nature andentered in the ordinary course of business and at arm's length. All related partytransactions are placed before the Audit Committee for review and approval.

All related party transactions entered during the Financial Year were in ordinarycourse of the business and on arm's length basis. No material related party transactionswere entered during the Financial Year by your Company. Accordingly the disclosure ofrelated party transactions as required under Section 134(3)(h) of the Companies Act 2013in Form AOC 2 is not applicable to your Company.

There are no materially significant related party transactions made by the Company withPromoters Directors Key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.

Members may refer to note no. 35 to the financial statement which sets out relatedparty disclosures pursuant to IND- AS - 24.

CONSERVATION OF ENERGY TECHNOLOGY & FOREIGN EXCHANGE EARNINGS AND OUTGO.

The particulars required to be disclosed pursuant to Section 134 (3) of the CompaniesAct 2013 read with rule 8 of the Companies (Accounts) Rule 2014 are given in Annexure II(A) and is an integral part of this Report.

RISK MANAGEMENT POLICY:

The Board of Directors has identified risks and steps to mitigate the same if and whenneed arises. However the executive Management has an adequately defined framework for riskmanagement. The Company like all business in the country is exposed to business andeconomic risk arising out of market conditions vagaries of monsoon and force majeureevents like Covid-19.

CORPORATE SOCIAL RESPONSIBILITY:

The Annual Report on CSR activities in term of the provisions of Companies (CorporateSocial Responsibilities Policy) Rules 2014 is at Annexure II (B) and is an integral partof this Report.

CORPORATE GOVERNANCE:

As per circular No. CIR/CFD/POLICY/CELL/7/2014 dated 15th September 2014 thecompliance with the provisions of Regulation 27 of SEBI (Listing Obligation &Disclosure Requirements) 2015 is not mandatory for the Company. Nevertheless the Companyhas been complying the provisions on voluntary basis.

The Company has taken adequate steps to ensure that all mandatory provisions ofCorporate Governance as prescribed under the SEBI (Listing Obligation & DisclosureRequirements) 2015 are generally complied with. A separate report on Corporate Governanceis attached as a part of the Annual Report along with the Auditors' certification on itscompliance.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY:

The Board of Directors of the Company has established a robust vigil mechanism processand to govern the same a well-defined whistle blower policy has been adopted by theCompany.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013.

The Company has in place an Anti-Sexual Harassment Policy since 2009 as per the SupremeCourt Guidelines which is in line with the requirements of The Sexual Harassment of Womenat the Workplace (Prevention Prohibition & Redressal) Act 2013. Internal ComplaintsCommittee (ICC) has been set up to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis policy.

The following is a summary of sexual harassment complaints received and disposed offduring the year 2019-20.

- No of complaints received: NIL

- No of complaints disposed off: NIL STATUTORY AUDITORS:

As per Section 139 of the Companies Act 2013 read with the Companies (Audit andAuditors) Rules 2014 the Members of the Company at the 44th Annual GeneralMeeting of the Company held on 4th August 2017 had appointed Messrs. walkerChandiok and Company LLP (Firm Registration No. 001076N/N500013) as Statutory Auditorsof the Company to hold office for a period of 5 (Five) consecutive financial years fromthe conclusion of the Forty Fourth Annual General Meeting of the Company until theconclusion of the Forty Ninth Annual General Meeting of the Company. The Company hadreceived their written consent and a certificate that they satisfy the criteria providedunder Section 141 of the Act and that the appointment if made shall be in accordancewith the applicable provisions of the Act and rules framed thereunder.

The Report given by Messrs. walker Chandiok and Company LLP (Firm Registration No.001076N/N500013) as Statutory Auditors of the Company on the financial statement of theCompany for the year 2019-20 is part of the Annual Report. There has been noqualification reservation or adverse remark or disclaimer in their Report.

During the year under review the Auditors had not reported any matter under Section143 (12) of the Act therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.

INTERNAL AUDITORS:

M/s. Engineer & Mehta Chartered Accountants Mumbai are the Internal Auditors ofthe Company. In a year they carry out three Internal Audit Runs which is commensurate withthe size of the Company and nature of its business.

SECRETARIAL AUDIT:

The Company had appointed M/s. P. Naithani and Associates a firm of Practicing CompanySecretaries to undertake the Secretarial Audit of the Company. The Secretarial AuditReport for the FY 2019 - 20 is annexed herewith as Annexure III. There are no reservationsor qualifications made in the Audit Report.

The Company has obtained a Secretarial Compliance Report pursuant to Regulation 24 (A)of SEBI (Listing Obligation and Disclosure Requirements) Regulations 2015 for FY 2019-20which is annexed herewith as Annexure IV. There are no reservations or qualifications madein this report.

The Company has obtained a certificate pursuant to Regulation 343 and Schedule V para Cclause 10(i) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015certifying that none of the Directors of the Company is barred or disqualified for beingappointed as Director for the Financial Year ending 31st March 2020. The same is annexedherewith as Annexure V.

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. P. Naithani and Associates a firm of Practicing Company Secretaries toundertake the Secretarial Audit of the Company for F.Y. 2020-21.

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION:

The worldwide pandemic Covid-19 started impacting India towards the end of February2020 and its severity increased alarmingly endangering the life of people. To mitigatethe impact of the pandemic and minimize loss of human lives the Central Governmentenforced national lockdown of people in their homes which resulted in shutdown of allmanufacturing and commercial operations and activities barring those most essential tolife operations and services. The initial lockdown of over five weeks was extended fromtime to time as the situation warranted. The lockdown was selectively and graduallyrelaxed but not totally lifted nationwide. The pandemic has crippled economies worldwideand there is no knowing when these would be up on their feet and running. Under suchextenuating circumstances the Directors are not in a position at this stage to assessthe impact on the Company's operations and financial results for the year 2020-21.

APPRECIATION:

Your Directors place on record their appreciation of the continued support andcooperation extended to the Company by the Central and State Government agencies and byour Shareholders Customers Suppliers Bankers Employees at all levels Employee's Unionand other Business Associates.

Your Directors take this opportunity to place on record on their behalf as well as onbehalf of the stakeholders their appreciation and gratitude to the Central and StateGovernments Municipal Corporations Medical fraternities Police and Security forcesCleaning and Sanitation staff and all agencies and their employees for their yeomenefforts in battling Covid-19 even at the risk of their own lives.

CAUTIONARY NOTE:

Certain statements in the Director's Report and Management & Discussion Analysissection may be forward looking and are stated as required by applicable laws andregulations. Many factors may affect the actual results which could be different fromwhat the Directors envisage in terms of future performance and outlook.

On Behalf of the Board of Directors
Place: Mumbai F. D. Neterwala
Date: 29th June 2020. Chairman
Din: 00008332