The Members of
VELJAN DENISON LIMITED
Your Directors take pleasure in presenting the 47th Annual Report on the affairs of theCompany along with the Audited Accounts for the year ended March 31 2021.
|1. FINANCIALRESULTS: || || |
|Particulars ||Year ended 31-03-2021 ||Year ended 31-03-2020 |
| ||Rs. in Lakhs ||Rs. in Lakhs |
|Income : || || |
|Revenue from Operations ||7356.87 ||8279.38 |
|Other Income ||181.13 ||125.13 |
|Total Revenue ||7538.00 ||8404.51 |
|Expenditure: || || |
|Cost of Materials Consumed ||2908.72 ||3295.54 |
|Changes in inventories of Finished goods Work-in- Progress and Stock-in-Trade ||(94.14) ||(735.55) |
|Employee Benefit Expenses ||689.79 ||736.71 |
|Finance Costs ||42.10 ||78.78 |
|Other Expenses ||2967.73 ||3217.66 |
|Total Expenses ||6514.20 ||6593.14 |
|Exceptional item ||127.14 ||- |
|Profit before Tax ||896.66 ||1811.37 |
|Tax Expenses || || |
|(1) i. Current Tax ||229.72 ||455.92 |
|ii. Previous Period ||(22.93) || |
|(2) Deferred Tax ||4.37 ||11.88 |
|Profit for the year ||685.50 ||1343.57 |
|Earning per Equity Share of the face value of Rs. 10 each Basic and Diluted (in Rs.) ||30.47 ||59.71 |
2. COMPANY'S PERFORMANCE:
During the year under review the sales were lower at Rs. 7356.87 Lacs as against Rs.8279.38 Lacs in the previous year. The Profit before tax stood at Rs. 896.65 Lacs asagainst Rs. 1811.37 Lacs for the previous year. The Net Profit stood at Rs. 685.49 Lacs asagainst Rs. 1343.58 Lacs for the previous year.
3. FUTURE OUTLOOK:
The COVID-19 pandemic caused a widespread global health crisis and economic hardship tobusinesses and communities across the globe which is unprecedented. Covid -19 has impactedJune and September Quarter's 2020 revenues and margins. We are hoping to resume to normallevel of operations during the current financial year.
India is one of the fastest growing markets for hydraulic components like valvescylinders accumulators pumps hydraulic hoses filters etc. Most foreign MNCs in fluidpower are already present in India with some of them here for a long time. The long termoutlook of the hydraulic industry continues to be promising and challenging. By increasingthe manufacturing base your Company expects to better the revenues with improved marginsin the coming years.
4. EVENTS SUBSEQUENTTOTHE DATE OFFINANCIALSTATEMENTS:
There were no material changes/ commitments affecting the financial position oroperations of the Company between March 31 2021 and the date of Board's Report.
5. MANAGEMENTDISCUSSIONSANDANALYSIS REPORT:
Management Discussions and Analysis Report as required under Regulation 34 of SEBI(Listing Obligation Disclosure Requirements) Regulations 2015 is annexed and forms partof this report.
Your Directors are pleased to recommend the payment of Dividend of Rs 10/- per share(100%) for the year ended March 31 2021. The Dividend if approved by the shareholders ofthe Company in its Annual General Meeting will be paid out of the profits of the Companyto all Shareholders of the Company whose names appear on the Register of Members as on thedate of the Book Closure.
Pursuant to Finance Act 2020 dividend income will be taxable in the hands ofshareholders w.e.f. 01st April 2020 and the Company is required to deduct tax at sourcefrom dividend paid to shareholders at the prescribed rates. The shareholders are requestedto update their PAN with the Company/ RTAor depositories. Shareholders are requested tonote that in case their PAN is not registered the tax will be deducted at a higher rateof 20%.
The Company has transferred Rs. 122.26 Crores to General Reserves of the Company.
Your Company has not accepted any deposits from the public during the year under reviewand as such no amount on account of principal or interest on deposits from public wasoutstanding as on the date of the balance sheet.
9. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGSAND OUTGO:
The information required under Section 134(3)(m) of the Companies Act 2013 read withthe Companies (Account) Rules 2014 with respect to conservation of energy technologyabsorption and foreign exchange earnings/ outgo is annexed to this Report.
10. NUMBER OFMEETINGS OFTHE BOARD OFDIRECTORSAND COMMITTEES:
The Board of Directors met 5 times during the financial year ended March 31 2021 inaccordance with the provisions of the Companies Act 2013 and rules made thereunder. TheDirectors actively participated in the meetings and contributed valuable inputs on thematters brought before the Board of Directors from time to time.
The Independent Directors held a separate meeting in compliance with the requirementsof Schedule IV of the Companies Act 2013 and Regulation 25(3) of the Listing Regulations.For further details of the meetings of the Board please refer to the Corporate GovernanceReport which forms part of this Annual Report.
11. DIRECTORSAND KEYMANAGERIALPERSONNEL:
None of the directors of the company is disqualified under the provisions of theCompanies Act 2013 or under the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2017 entered with BSE Limited.
As per the provisions of Section 152 of the Companies Act 2013 read with Articles ofAssociation of the Company Mr. V.C. Janardan Rao (DIN: 00181609) retire by rotation andbeing eligible offer himself for re appointment at this Annual General Meeting. The Boardrecommends his re-appointment at the ensuing AGM.
During the year under review
1. Mr. G. Narayan Rao (DIN: 00029120) was appointed as Additional Director(Professional Director) of the Company with effect from 31.07.2020 and re-designated asadditional Director (Independent Director) with effect from 15.09.2020 and the saidappointment was approved by the shareholders in AGM held on 31.12.2020.
2. Mr. U. Sri Krishna (DIN: 0008880274) was appointed as Additional Director and Wholetime Director designated as Executive Director of the Company with effect from 15.09.2020for a period of 3 years by the Board in their meeting held on 15.09.2020 and the saidappointment was approved by the shareholders inAGM held on 31.12.2020.
As on the date this report the following are the Key Managerial Personnel of theCompany:
|1. ||Mr.V.C. Janardan Rao ||Chairman & Managing Director |
|2. ||Mr.G. Subba Rao ||Chief Financial Officer |
|3. ||Mr. B. Narahari ||Company Secretary and compliance officer |
12. STATEMENTON DECLARATION GIVEN BYINDEPENDENT DIRECTORS:
All Independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149(6) of the companies Act 2013 and Regulation16 of the SEBI (LODR) Regulations 2015.
13. ANNUALEVALUATION BYTHE BOARD OFITS OWN PERFORMANCE:
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing ObligationDisclosure Requirements) Regulations 2015 the Board has carried out an annual performanceevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Audit and other Committees.
14. COMPANY'S POLICYON DIRECTOR'SAPPOINTMENTAND REMUNERATION:
The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration including criteria for determining qualifications positive attributesindependence of a Director and other matters provided under sub section (3) of section 178relating to the remuneration for the Directors Key Managerial Personnel and otheremployees.
15. INTERNALFINANCIALCONTROLSYSTEMSAND THEIRADEQUACY:
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The Internal audit Department monitors and evaluates theefficacy and adequacy of internal control systems accounting procedures and policies.
The Board of Directors of the Company had appointed M/s. M.V. Narayana Reddy & Co.Chartered Accountants as Internal Auditors of the Company for the Financial Year 2019-20and to maintain its objectivity and independence the Internal Auditor reports to theChairman of theAudit Committee of the Board.
M/s.K. S. Rao&Co Chartered Accountants Hyderabad (FRN:003109S) were appointed asthe Statutory Auditors of the Company for a period of 5 years to hold office from theconclusion of 43rd Annual General Meeting (AGM) till the conclusion of the Forty EighthAGMto be held in the year 2022 subject to ratification of their appointment at every annualgeneral meeting in terms of the provisions of Companies Act 2013.
However as per the amended provisions of the Companies Act 2017 notified on 07.05.2018the Company is not required to ratify the appointment of auditors at every annual generalmeeting therefore it is not proposed to ratify the appointment of auditors at theensuing Annual General Meeting.
During the year under review the Statutory Auditors of the Company have not reportedany fraud as required under Section 143(12) of the Companies Act 2013.
The Auditor's Report for the financial year 2020-21 does not contain any qualificationreservation or adverse remarks.
17. SECRETARIALAUDITORS &THEIR REPORT:
The Board had appointed M/s BS & Company Company Secretaries LLP Hyderabad tocarry out Secretarial Audit under the provisions of Section 204 of the Companies Act 2013for the financial year 2020-21. The report of the Secretarial Auditor is annexed to thisreport. The Report for the financial year 2020-21 does not contain any qualificationreservation or adverse remarks.
18. TRANSFER OFUNPAID/ UNCLAIMEDAMOUNTSTO IEPF:
Pursuant to the provisions of Sections 124 and 125 of the Act read with the IEPF(Accounting Audit Transfer and Refund) Rules 2016 dividend / interest / refund ofapplications which remains unclaimed / unpaid for a period of 7 years is required to betransferred to IEPF. Further the IEPF Rules mandate the companies to transfer all shareson which dividend remains unclaimed / unpaid for a period of 7 consecutive years to thedemat account of the IEPF Authority. Hence the Company urges all the shareholders toencash/claim their respective dividend during the prescribed period.
Accordingly during the financial year 2021-22 the dividend for the year 2013-14remaining unpaid and unclaimed for 7 years and shares pertaining to which dividend remainsunpaid / unclaimed for 7 consecutive years shall be transferred by the Company to IEPF.The Members / claimants whose shares or unclaimed dividends get transferred to IEPF mayclaim the shares or apply for refund from the IEPF Authority by following the refundprocedure as detailed on the website of IEPF Authority athttp://www.iepf.gov.in/IEPF/refund.html.
19. PARTICULARS OFLOANS GUARANTEESAND INVESTMENTS
Particulars of loans guarantees and investments have been disclosed in the financialstatements.
The Company had not given any loans guarantees or made investments as per theprovisions of Section 186 of the Companies Act 2013 during the financial year underreview and also there are no outstanding amounts of loans given guarantees provided and /or investments made at the beginning of the year.
20. DETAILS OFSUBSIDIARY ASSOCIATE AND JOINT VENTURE OFTHE COMPANY:
The Company doesn't have any subsidiary associate and joint venture.
21. TRANSACTIONS WITH RELATED PARTIES:
All related party transactions done by the company during the financial year were atarm's length and in the ordinary course of business. All related party transactions wereplaced in the meetings of Audit committee and the Board of directors for their necessaryreview and approval. Details of all such transactions as required under section 188 of theCompanies Act are annexed in FormAOC-2 forming part of the Board's Report.
Disclosures pursuant to Accounting Standards on related party transaction have beenmade in the notes to the Financial Statements.
The Company has formulated a policy on materiality of Related Party Transactions anddealing with Related Party Transactions which can be accessed at the Companys' websitehttp://veljan.in/investors.html.
22. CORPORATE SOCIALRESPONSIBILITY:
As part of its initiatives under "Corporate Social Responsibility (CSR)" theCompany has made contributions to various activities as approved by the Committee and isin accordance with Schedule VII of the Companies Act 2013 read with the relevant rules.
The contents of the CSR activities undertaken by the Company have been annexedseparately and forms part of this report.
23. EXTRACT OFANNUALRETURN:
As required by Section 92(3) of the Act read with Rule 12(1) of the Companies(Management and Administration) Rules 2014 extract of the Annual Return in Form MGT-9 isavailable on the Company's website at http://veljan.in/investors.html and forms part ofthis report.
24. PARTICULARS OFEMPLOYEES:
There are no employees in the company in receipt of amounts covered in rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. Thedisclosure pertaining to remuneration and other details of top 10 employees of the Companyare made available for inspection at the Registered office of the Company with the CompanySecretary during working hours and any Member interested in obtaining such information maywrite to the Company Secretary and the same shall be provided without any fee.
Details of the ratio of the remuneration of each of the director to the medianemployee's remuneration and other details as required pursuant to Rule 5(1) of theCompanies (Appointment and Remuneration of managerial Personnel) Rules 2014 has beenannexed separately and forms part of this report.
26. CORPORATE GOVERNANCE CERTIFICATE:
The Compliance certificate from the Secretarial Auditors regarding compliance ofconditions of Corporate Governance as stipulated in SEBI (Listing Obligation DisclosureRequirements) Regulations 2015 is provided elsewhere and forms part of this report.
The Equity Shares of your Company are continued to be listed on BSE Limited. There areno payments outstanding to the Stock Exchange and the company has paid the listing fee forthe financial year 2021-22.
28. DIRECTORS' RESPONSIBILITYSTATEMENT:
In terms of Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that (based on the representations receivedfrom the Management):
i) In the preparation of Annual Accounts the applicable Accounting Standards have beenfollowed along with proper explanations relating to material departures if any;
ii) they have selected such accounting policies and applied them consistently and madejudgments and estimates that were reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the Financial Year and of theProfit of the Company for that period ;
iii) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safe guarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv) they have prepared the Annual Accounts on a going concern basis;
v) they have laid down internal financial controls to be followed by the Company andsuch internal financial controls are adequate and operating effectively;
vi) they have devised proper systems to ensure Compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
29. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTIONPROHIBITIONAND REDRESSAL)ACT 2013:
The Company has put in place a Prevention Prohibition and Redressal of SexualHarassment at Workplace in accordance with the requirement of the 'Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013.All employees of theCompany are covered under the aforementioned Policy.
During the year under review the company has not received any complaints pertaining tosexual harassment
30. DETAILS OFSIGNIFICANTAND MATERIALORDERS PASSED BYTHE REGULATORS:
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Company's operations in future.
31. VIGILMECHANISM/WHISTLE BLOWER POLICY:
Your Company has an effective Vigil Mechanism system which is embedded in its Code ofConduct. The Code of Conduct applies to all the employees including Directors of theCompany.
The Code of Conduct is available on the Company website to report any genuine concernsabout unethical behavior any actual or suspected fraud or violation of Company's Code ofConduct.
32. REPORTON CORPORATE GOVERNANCE:
In accordance with the Regulation 16 of the SEBI (LODR) Regulations 2015 the Companyhas complied with all mandatory recommendations. A Report on corporate Governance isprovided elsewhere and forms part of this report.
33. INDUSTRIALRELATIONSAND HUMAN RESOURCES:
Your company believes that its employees are one of the most valuable assets of theCompany and the Board appreciates the employees across the cadres for their dedicatedservice to the company and expects their continuous support and higher level ofproductivity for achieving the targets set for the company. The total employee strength isover 202 as on March 31 2021.
34. SHARE CAPITAL:
There was no change in the Authorized Share Capital (Rs. 3 Crores) and Paid up ShareCapital (Rs. 2.25 Crores) of the Company during the year under review.
The Company has not issued any shares with differential rights and hence no informationas per the provisions of Section 43(a) (ii) of the Act read with Rule 4(4) of theCompanies (Share Capital and Debenture) Rules 2014 is furnished.
All properties and insurable interests of the Company including building plant andmachinery and stocks have been fully insured.
36. CHANGE IN THE NATURE OFBUSINESS:
There was no change in the nature of business of the Company.
37. DETAILS OF DIRECTORS OR KEY MANAGERIAL PERSONNEL WHO WERE APPOINTED OR HAVERESIGNED DURING THEYEAR:
1. Mr. G. Narayan Rao (DIN: 00029120) was appointed as Additional Director of theCompany with effect from 31.07.2020 and appointed as Independent Director for a first termof Five years with effect from 15.09.2020.
2. Mr. U. Sri Krshna (DIN: 0008880274) was appointed as Additional Director and Wholetime Director designated as Executive Director of the Company with effect from 15.09.2020for a period of 3 years.
38. RISK MANAGEMENT:
The Board of Directors has formed a risk management policy to identify evaluatemitigate and monitor the risk associated with the business carried by the company. TheBoard reviews the risk management plan and ensures its effectiveness. Amechanism has beenput in place which will be reviewed on regular intervals.
39. COMMITTEES OFTHE BOARD:
The Board has Audit Committee Nomination and Remuneration Committee Stakeholders'Relationship Committee and Corporate Social Responsibility Committee. The composition andother details of these committees have been given in the Report on the CorporateGovernance forming part of the Annual Report.
Pursuant to provisions of section 148 of the Companies Act 2013 read with Companies(Cost Records and Audit) Rules 2014 cost audit is not applicable for the financial year2019-20 for the Company.
41. COMPLIANCE OFSECRETARIALSTANDARDS:
The Company has duly complied with the applicable Secretarial Standards issued by TheInstitute of Company Secretaries of India for the Board and General Meetings.
42. CORPORATE POLICIES OFTHE COMPANY:
The policies are reviewed periodically by the Board and updated as needed.The SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 as amended mandatethe formulation of certain policies for all listed companies. The corporate governancepolicies like Familiarization Programme for Independent Directors Policy forDetermination of Materiality of an Event or Information Policy on Preservation ofDocuments and Policy on Related Party Transactions etc for are available on the Company'swebsite at http://veljan.in/investors_policy.html.
Your Directors acknowledge with a deep sense of gratitude the continued supportextended by Investors Customers Business Associates Bankers and Vendors.
Your Directors take this opportunity to thank the regulatory Authorities andGovernmental Authorities for continued support and assistance.
Your Directors also place on record their appreciation for the contribution of all theemployees of the Company in achieving the performance.
| ||By order of the Board |
| ||FOR VELJAN DENISON LIMITED |
|Place: Hyderabad ||V.C. Janardan Rao |
|Date: 14-08-2021 ||Chairman & Managing Director |
| ||DIN: 00181609 |