Your Directors are pleased to present the 35th Annual Report of the Company togetherwith the Audited Statements of the Accounts for the year ended 31st March 2017.
1. SUMMARIZED FINANCIAL HIGHLIGHTS
The Company's financial performance for the year ended 31st March 2017 as aforesaidis summarized below:
| || ||(Figures in t Lakh] |
|PARTICULARS ||FOR THE CURRENT YEAR ENDED 31ST MARCH 2017 ||FOR THE PREVIOUS YEAR ENDED 31ST MARCH 2016 |
|Gross Turnover and other receipts ||8174.23 ||3636.93 |
|Profit/(Loss) before Interest and Depreciation ||2834.83 ||1620.64 |
|Less: Interest ||52.57 ||58.73 |
|Profit/(Loss) Before Depreciation ||2782.26 ||1561.91 |
|Less: Depreciation ||662.33 ||897.48 |
|Profit/(Loss) Before Tax ||2119.93 ||664.43 |
|Less: Provision for taxation ||34.80 ||11.44 |
|Profit/(Loss) After Tax ||2085.13 ||652.99 |
|Balance brought forward from previous year ||2867.32 ||3215.49 |
|Less: Transfer to Capital Redemption Reserve ||NIL ||1001.16 |
|Balance carried to Balance Sheet ||4952.45 ||2867.32 |
2. BUSINESS PERFORMANCE
Your company has performed very well during Financial Year 2016-17 as compared toprevious year. The company has shown a profit of Rs. 20.85 crores after taxes as comparedto Rs. 6.5 crores last year. The company was able to achieve this performance through newtechnology developing new and more efficient product higher efficient cost saving and welleducated strategy.
The company is also making roads in expert market for some of its product and isshowing continuous growth increasing its customer base which will result into substantialfuture growth in the company.
We are taking advantages of lower cost at which company can deliver world qualityproducts at very competitive prices. Further the company is able to reduce itsmanufacturing cost and enhance by continuing cost reduction and research and developmentof new and more efficient products.
The company is also getting substantial success in its unit situated at SEZ Noida andKSEZ Kandla which are playing important role in achieving higher than the expectedproduction targets and goals. The company expects to further increase the role of SEZunits in improving its production capacities by further capital investment in these units.
Your Directors recommend a Dividend at the rate of 12% on paid up Equity Share Capitali.e Rs. 1.2/-for each share of ? 10/-each of the Company to be appropriated from theprofits of the Company for the financial year 2016-17 subject to the approval of theshareholders at the ensuing Annual General Meeting.
THE COMPOSITION OF THE BOARD OF DIRECTORS ARE GIVEN BELOW:
|S. NO ||NAME OF THE DIRECTOR ||DESIGNATION ON THE BOARD |
|1 ||Mr. Pramod Kumar Gupta ||Chairman and Managing Director |
|2 ||Mr. Shiv Sharan Kumar Bhagat ||Independent Director |
|3 ||Mr. Vidya Bhushan. Mishra ||Independent Director |
|4 ||Mr. Krishan Diyal Aggarwal ||Independent Director |
|5 ||Mr. Uma Shankar Pandey ||Non-Executive Director |
|6. ||Mr. Kanal Gupta ||Non-Executive Director |
|7. ||Mr. Pandian Kalyanasundaram ||Independent Director |
|8. ||Ms. Sarita ||Woman Director |
|9. ||Mr. Inderpal Sharma ||Additional Director |
4. FUTURE OUTLOOK
As the demand of oil and gas is increasing substantially in the country and overseasthe requirement of company's products which are directly used in exploration of oil arealso increasing. Further due to cost effectiveness of our products with internationalquality will help the company procuring more and more business from oil sector in Indiaand overseas. Further by engaging strong team of business development experts the companyexpects to increase its business in domestic and international market considerably.Therefore future outlook of the company looks very promising.
Your Company's Equity Shares are presently listed on 'BSE Limited' a recognized stockexchange of India. The Company has paid the listing fees for the year 2016-2017 to BSELimited where the securities of the Company are listed.
6. MAJOR EVENT
The company was engaged in several major events during the year some of whichparticipation in Petrotech which is an Oil show organization are being organized byMinistry of Petroleum and Oil and Gas Industry. There were 643 participants from differentparts of the world your company also had a booth in the exhibition and the products ofthe company were appreciated by the participants in the Oil Sector in India and around theworld. The company had also exhibited one of its star product i.e. Truck Mounted Wire LineWinch with Crane which was manufactured and supplied to ONGC for the first time in India.This gives substantial saving to ONGC in its operation. The company is expecting severalorders of these machines from India and abroad because of this participation.
7. CONSOLIDATED FINANCIAL STATEMENTS
Your Company has no Joint Venture Subsidiaries and Associate Companies therefore inpursuant to relevant provisions of the Companies Act 2013 accounting rules andregulations as prescribed under Accounting Standard (AS)- 21 there was no need ofconsolidated Financial Statements.
8. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
As stated above your Company has no subsidiaries Joint Venture and AssociatesCompanies.
9. DIRECTORS & COMMITTEE
Your Board comprises of eminent experienced and reputed individuals from theirrespective fields. The composition of Board of the Company was in conformity with theprovision of Section 149 of Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015. There were Four Independent Directors of theCompany. Mr. Pandian Kalyansundaram (DIN: 02368099) Independent Director and Ms. Sarita(DIN: 07580853) woman Director was appointed during the year. A meeting of IndependentDirectors was held on 13.02.2017. Mr. Inderpal Sharma (DIN: 07649251) was appointed asAdditional Director who is in whole time employment of the Company.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under theprovisions of Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. Further all the members of Board declared their holdingas well as interest in the Company as per requirement
In accordance with the provisions of Companies Act 2013 Mr. Uma Shanker Pandey havingDIN: 02877691 Non- Executive Director retires by rotation and being eligible offershimself for re-appointment.
9.1 BOARD EVALUATION
Pursuant to the provisions of Companies Act 2013 and as per the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board had carried outannual performance evaluation of its own performance the Directors individually as wellthe evaluation of the working of its Audit Nomination & Remuneration and StakeholderCommittee. The manner in which the evaluation has been carried out has been explained inCorporate Governance Report.
9.2 REMUNERATION POLICY
The Board has on the recommendation of the Nomination and Remuneration Committee frameda policy for selection
and appointment of Directors Senior Management and their remuneration.
During the year Five (5) Board Meetings and one (1) Independent Director's meeting wereheld the Details of which are given below and in the Corporate Governance Report. Theprovisions of Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 were adhered to while considering the time gap between twomeetings and various other requirements including Secretarial Standards as issued by theICSI. The dates of Meetings held during the year are as under:-
Board Meetings: 21.05.2016 06.08.2016 21.09.2016
10.11.2016 & 13.02.2017
Independent Directors' Meeting: 13.02.2017
9.4 AUDIT COMMITTEE
The Company is having an Audit Committee comprising of the following IndependentDirectors:-
|NAME ||STATUS ||DESIGNATION |
|Mr. Pandian Kalyanasundram ||Chairman ||Non-Executive & Independent Director |
|Mr. Krishan Diyal Aggarwal ||Member ||Non- Executive & Independent Director |
|Mr. Shiv Sharan Kumar Bhagat ||Member ||Non-Executive & Independent Director |
|Mr. P.K. Ojha ||Secretary ||Company Secretary |
The Board of Director had appointed Mr. Pandian Kalyanasundram as a Chairman of theAudit Committee in place of Mr. Vidya Bhushan Mishra in its meeting held on 13.02.2017.All the recommendations made by the Audit Committee were considered and accepted if anyrequired by the Board. The date of meetings held during the year are as under:-
21.05.2016 06.08.2016 10.11.2016 & 13.02.2017
9.5 NOMINATION AND REMUNERATION COMMITTEE
The company is having a Nomination and Remuneration Committee comprising of thefollowing Directors:
|NAME ||STATUS ||DESIGNATION |
|Mr. Krishan Diyal Aggarwal ||Chairman ||Non- Executive & Independent Director |
|Mr. Shiv Sharan Kumar Bhagat ||Member ||Non-Executive & Independent Director |
|Mr. Vidya Bhushan Mishra ||Member ||Non-Executive & Independent Director |
|Mr. Pandian Kalyanasundaram ||Member ||Independent Director |
There were Three (3) meetings of Nomination and Remuneration Committee held during thefinancial year 2016-17 i.e on
06.08.2016 10.11.2016 & 13.02.2017.
All the recommendations made by the Nomination & Remuneration Committee wereconsidered by the Board on appointment and fixing of remuneration of Board of Directorsand Senior Management etc.
9.6 STAKEHOLDER GRIEVANCE/RELATIONSHIP COMMITTEE
The Company is having Stake Holder Grievance/Relationship Committee comprising of thefollowing Directors:
|NAME ||STATUS ||DESIGNATION |
|Mr. Vidya Bhushan Mishra ||Chairman ||Non-Executive and Independent Director |
|Mr. Kanal Gupta ||Member ||Non-Executive Director |
|Mr. Krishan Diyal Aggarwal ||Member ||Non-Executive and Independent Director |
|Mr. Pandian Kalyanasundaram ||Member ||Independent Director |
|Mr. P.K. OJha ||Company Secretary ||Compliance Officer |
During the financial year 2016-17 Five (5) meetings of the StakeholderGrievance/Relationship Committee were held which are as follows: 21.05.2016 06.08.201610.11.2016 13.02.2017 & 24.03.2017. All the members of the Committee were presentexcept for meeting held on 21.05.2016 & 06.08.2016 in which Mr. Uma Shanker Pandey wasabsent. Mr. Kanal Gupta was appointed as member of the Committee by the Board in itsmeeting held on 06.08.2016 in place of Mr. Uma Shanker Pandey.
10. CORPORATE SOCIAL RESPONSIBILITY
The Company has a Board-Level Committee that supervises its Corporate SocialResponsibility (CSR) activities. During the financial year 2016-17 the Committee heldfive (5) of its meetings which are as follows: 03.06.2016 11.07.2016
05.10.2016 23.12.2016 & 25.03.2017. The committee after due verification ofvarious NGO's as per the criteria laid down in the CSR Rules as issued by the Ministry ofCorporate Affairs New Delhi selected many reputed NGOs for undertaking various CSRProjects/ Programs as specified in Schedule VII of the Companies Act 2013. The disclosureof CSR Activities for financial year 2016-17 in the prescribed format are enclosed as"Annexure - I" as a part of this report.
11. VIGIL MECHANISM/WHISTLE BLOWER POLICY
In order to ensure that the activities of the Company and its employees are conductedin a fair and transparent manner the Company as a Whistle Blower Policy adopts higheststandards of professionalism honesty integrity and ethical behavior. Protecteddisclosures can be made by a whistle blower through an e-mail dedicated telephone line ora letter to the Chairman of the Audit Committee.
This policy is also uploaded on the website of the Company.
12. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 the Directors confirm that:
a. In the preparation of the Annual Accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
b. Appropriate accounting policies have been selected and applied consistently and havemade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at 31st March 2017 and of the profit ofthe Company for the financial year ended 31st March 2017.
c. Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities.
d. The Annual Accounts have been prepared on a going concern basis;
e. Internal financial controls have been laid down to be followed by the Company andsuch internal financial controls are adequate and were operating effectively;
f. Proper system has been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
13. BUSINESS RESPONSIBILITY REPORT
The provision relating to the Business Responsibility Report describing the initiativestaken by the Company from environmental social and governance perspective as stipulatedunder the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is notapplicable to your Company.
14. RELATED PARTY TRANSACTIONS
In pursuance to the provisions of Section 108 and 110 of the Companies Act 2013 theCompany took approval from the members of the Company through Postal Ballot Notice Dated21.04.2015 and Result Dated 22.05.2015 for Related Party transactions required under theprovisions of Section 188 of the said Act during the financial year 2015-16.
During the financial year 2016-17 the Company had paid rent of f 750000/- (Seven LacFifty Thousand only) to P. Mittal Manufacturing Pvt. Ltd. in which one of the Director Mr.Kanal Gupta was also a Director & member and Mr. Pramod Kumar Gupta Managing Directorof the company was also a member. Your Directors draw your attention to Note: 10(B) to theFinancial Statements which deals with related party disclosures. The AOC-2 is enclosed as"Annexure -II".
15. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There were no significant material orders passed by the Regulators / Courts which wouldimpact the going concern status of the Company and its future operations.
16. INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference toFinancial Statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operations were observed.
17. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. Uma Shanker Pandey Director of the Company retire byrotation at the ensuing Annual General Meeting and being eligible have offered himself forre-appointment.
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under the Actand the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 asprescribed by the SEBI.
The details of programs for familiarization of Independent Directors with the Companytheir roles rights responsibilities in the Company nature of the industry in which theCompany operates business model of the Company and related matters are uploaded on thewebsite of the Company.
Furthermore pursuant to the provisions of Section 203 of the Companies act 2013 theBoard had nominated below stated persons as KMP
|Mr. Pramod Kumar Gupta - ||MANAGING DIRECTOR |
|Mr. Pramod Kumar Ojha - ||COMPANY SECRETARY |
|Mr. Arun Kumar Thakur - ||CHIEF FINANCIAL OFFICER |
18.1 STATUTORY AUDITORS
M/s R S Dani & Co. Chartered Accountants were reappointed to act as such bymembers in 34th AGM of the Company as Statutory Auditors of the Company.
Accordingly an Audit Report along with Financial Statements as on 31.03.2017 are beingplaced before the members for their consideration and adoption.
Furthermore as the appointment was done for a period of five years as stipulated underprovisions of Chapter X of the Companies Act 2013 read with applicable rules subject toratification by members at every Annual General Meeting hence ratification of appointmentof Statutory Auditors is being sought from the members of the Company at the ensuingAnnual General Meeting.
M/s R S Dani & Co. Chartered Accountants Statutory Auditors of the Company holdoffice till the conclusion of the ensuing Annual General Meeting and are eligible forre-appointment. They have confirmed their eligibility to the effect that theirre-appointment if made would be within the prescribed limits under the Act and that theyare not disqualified for re-appointment.
The Notes on Financial Statements referred to in the Auditors' Report of the years areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualifications reservations or adverse remarks.
18.2 SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hadappointed M/s Balraj Sharma & Associates Company Secretaries New Delhi to undertakethe Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith asAnnexure - III'.
The Notes referred in the Secretarial Auditors' Report are self-explanatory and do notcall for any further comments. The Secretarial Auditor Report does not contain anyqualifications reservations or adverse remarks.
18.3 INTERNAL AUDITORS
Consequent upon existence of provisions of Section 138 of the Companies Act 2013 Mr.Vishnu Singh who having vast experience in Finance and Accounts was appointed to performthe duties of Internal Auditor of the Company for financial year 2016-17 and theirquarterly report was reviewed by the Audit Committee as provided by them on quarterlybasis. The Report of Internal Auditors had not contain any qualifications reservations oradverse remarks.
19. CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by SEBI for statutory andnon-statutory regulations. In pursuance of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 in respect to Corporate Governance the Company dulycomplied and submitted a quarterly report to the stock exchanges on each occasion. TheCompany has also followed the Corporate Governance practices which enables it to maintaintransparency and serve the long-term interest of the Shareholders. The report on CorporateGovernance as on 31.03.2017 are attached hereto as a part of this Annual Report asAnnexure - IV".
20. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 of SEBI iselaborated in a separate section forming part of the Annual Report and attached as"Annexure V".
21. DEMATERIALISATION OF EQUITY SHARES
Your Company is registered with CDSL & NSDL for dematerialization and Company'sISIN Number is INE961D01019. M/s Alankit Assignments Ltd. is acting as its agent for dematand other related requests of the shareholders for its equity shares.
22. HUMAN RESOURCES DEVELOPMENT
The Company continues to enjoy cordial and warm relations with the employees andexecutives at all levels. Special training programmes workshops seminars etc. werecontinued during the year with a focus towards infusion of technical skills and qualityconsciousness in order to improve productivity efficiency and quality and latesttechnology of the employees of the Company.
23. INDUSTRIAL RELATIONS
The industrial relations among all the employees within the organization were cordial.The employees maintained highest level of discipline decency for the growth of theorganization.
24. ECOLOGY & SAFETY CERTIFICATE
The Company has taken adequate provisions for ecology and safety of plant building andmanpower's welfare activities.
25. EXTRACT OF ANNUAL RETURN
Pursuant to the provision of Section 92(3) of the Companies Act 2013 and Rule 12(1) ofthe Companies (Management and Administration) Rules 2014 the extract of Annual Return ason the Financial year ended 31st March 2017 in Form No. MGT-9 is enclosed as"Annexure - VI" of Annual Report.
26. CONSERVATION OF ENERGY
Your Company does not fall under the list of industries which are required to furnishinformation in respect of conservation of energy yet the Company has taken due measures tocontrol the wastages of energy and lights power as energy conservation dictates howefficiently a company can conduct its operations. Further you company got NOC from statepollution control of U.P. Government.
The other particulars relating to conservation of energy technology absorptionforeign exchange earnings and outgo as required to be disclosed under the Act areprovided as "Annexure VII" in this Report.
27. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remuneration inexcess of the limits set out in the said rules are provided in "Annexure -VIII"as part of the Annual Report.
Your Board states that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.
4. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
29. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTIONPROHIBITION & REDRESSAL) ACT 2013
The Company has in place an Anti-Sexual Harassment Policy in line with the requirementof the Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding Sexual Harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.
The following is a summary of Sexual Harassment complaints received and disposed offduring the year 2016-17:
No of complaints received: Nil No of complaints disposed off: Nil
On behalf of the Board I would like to convey to our Hon'ble members that over theyears your deep and abiding trust and invaluable support has enabled us to continuouslyimprove our performance despite extremely challenging times in the recent past where insourcing raw materials /components at competitive prices have become an arduous task andfurther hope they will continue to give their support in full spirit in the years to come.
| ||For and on Behalf of the Board |
| ||United Drilling Tools Limited |
| ||sd/- |
| ||Pramod Kumar Gupta |
|Place: New Delhi ||Chairman & Managing Director |
|Date: 11.08.2017 ||DIN:00619482 |