FOR THE YEAR ENDED ON 31st MARCH 2020
To the Members of VTM Limited
Your Directors have pleasure in presenting their 73rd Annual Report along with theAudited statement of accounts for the year ended 3 1st March 2020
Adoption of Financial Statements under fad AS:
Pursuant to the notification issued by the Ministry of Corporate Affairs dated 16thFebruary 2015 relating to the Companies (Indian Accounting Standards) Rules 2015 theCompany has adopted "Ind AS" with effect from 1st April 2017.Accordingly the Financial Statements for the year 2019- 2020 have been prepared incompliance with the Companies (Indian Accounting Standards) Rules 2015.
Operating & Financial Performance Profits Dividends & Retention
Rs. in Lakhs.
| ||2019-2020 ||2018-19 |
|Turnover ||16053 ||15980 |
|Profit before Depreciation (after interest) ||2399 ||2082 |
|Less; Depreciation ||763 ||682 |
|Profit after Depreciation ||- ||- |
|Less: Provision for Taxation; ||1636 ||1400 |
|Current Year ||309 ||347 |
|Current tax adjusted to earlier years ||420 ||- |
|Deferred Tax ||137 ||32 |
| ||426 ||379 |
|Profit after Tax ||1210 ||1021 |
|Add: Amount brought forward ||852 ||788 |
|Available for appropriation ||2062 ||1809 |
|Appropriation:- || || |
|Transfer to General Reserve ||351 ||600 |
|Interim dividend @ Re.0.90 per share ||362 ||0 |
|Dividend @ Re.0.90 per share ||362 ||302 |
|Income Tax on Dividend ||149 ||62 |
| ||873 ||364 |
|Transfer from Other || || |
|Comprehensive income ||- ||(7) |
|Retained profit carried forward to the following year ||838 ||852 |
During the year under review the Company's performance has improved with a higher netprofit of Rs. 1636 lakhs against Rs.1400 lakhs (16% increase) amidst marginal increase inTurnover. The Company was able to register export turnover of Rs. 4195.58 lakhsrepresenting 26.14% of the total turnover.
The year 2019-20 was by itself a challenging year with growth slowing in India anddemand was moderating. On top of this we witnessed the pandemic break out which broughtthe world to a near standstill. The lockdown in India was complete. Both these haveadversely affected the business environment. There is a slowdown in consumption ofproducts across the spectrums. Your Company is no exception.
We are adjusting the Company's strategies to meet this challenge and are confident thatdemand revival will be seen from the coming months.
Moderniation & Upgradation
During the year under review your Company has invested Rs. 13.12 Crores for installingnew looms and accessories. The Company's plant and equipment are up-to-date to meet thevaried market requirements.
Appropriation to General Reserve
Considering the profitability and the available surplus the Board of Directors desiresto appropriate a sum of Rs.351 lakhs to General Reserve.
The Company paid an Interim Dividend of Re.0.90 per Share of Equity Share Capital as onrecord date fixed for this purpose ie. 26.02.2020. This is to be considered as FinalDividend.
Extract of Annual Return
As per the requirements of Section 92 of the Companies Act 2013 read with Rule 12 ofthe Companies (Management & Administration) Rules 2014 the extract of annual returnin the prescribed Form MGT 9 is annexed hereto as Annexure III forming part of the report.
Associate Company/Holding or Subsidiary Company
The Company does not have any Associate Company as defined under the Companies Act2013 and has not entered into any joint venture agreement during the year under review.
Change in the Business of Nature
There is no change in the nature of the business of the Company.
Orders by Regulation or Courts
There were no significant and material orders passed by regulators or courts ortribunals impacting the going concern status and Company's operations in future.
Material Changes Affecting the financials
There were no material changes and commitments affecting the financial position of theCompany occurring between March 312020 and the date of this Report of the Directors.
Internal Control System
The Company has in place an established internal control system designed to ensureproper recording of financial and operational information and compliance of variousinternal controls and other regulatory and statutory compliances. Code on Internal Controlwhich require that the Directors to review the effectiveness of internal controls andcompliance controls financial and operational risks risk assessment and managementsystems and related party transactions have been complied with. Self certificationexercises are also conducted by which senior management certifies effectiveness of theinternal control system their adherence to Code of Conduct and Company's policies forwhich they are responsible financial or commercial transactions if any where they havepersonal interest or potential conflict of interest. Internal Audit has been conducted onperiodical basis.
Company's Policies on Corporate Social Responsibility Remuneration Employee Concern(Whistle Blowing) the Code of Conduct applicable to Directors and Employees of theCompany and policies such as Insider Trading Code insider Trading .Fair Disclosure Codeand Policy on Materiality of and dealing with Related Party Transactions required underSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and SEBI(Prohibition of Insider Trading) Regulations 2015 have been complied with.
These Policies the Code of Conduct and other policies/codes as referred above areavailable on the Company's website www.vtmill.com
ISO and 5S Certification
The Company's factory at Sulakarai Virudhunagar Tamil Nadu has been certified ISO forQuality Management System Standard and also holds a 58 Certification from AOTS Alumni 5SForum of India and GOTS Certification for the manufacture of organic cotton fabrics.
The Company is primarily a manufacturer of textile products and is managedorganizationally as a single unit. Accordingly the Company is a single business segmentcompany. Geographical (secondary) segment has been identified as domestic sales andexports as detailed below;
|Particulars ||Amount (Rs. lacs) ||% of Turnover |
|Export Sales ||4195.58 ||26.14 |
|Domestic Sales ||11857.88 ||73.86 |
Industry Structure & Developments Opportunities & Threats Outlook Risks& Concerns
The Indian economy ant! the consumer demand continued to be sub-optimal during the yearunder review. The credit cycles have been increasing and liquidity in the markets werevery low. During the year under review export of grey fabrics from the country witnesseda declining trend.
The power situation continues to be comfortable.
The Company is taking steps for development and implementation of risk managementpolicies. The Company sees certain risks due to the low liquidity and extended creditcycles in the domestic and international markets. Your Company is taking alt steps andprecautions to mitigate this.
Further in the domestic market there is a risk of competition from a large number oftextile units and the uncertainty of monsoon and its consequential impact on the demandscenario.
The spread of COV1D-19 pandemic is a new and unprecedented threat and we are not ableto estimate its impact during the full year.
Your Directors look forward to the current year with hope and optimism they expect thereform process in the economy will be accelerated by the Government which in turn willprove positive for trade & industry.
Board of Directors
The Board consists of 8 Directors with one Chairman and Managing Director fourNon-Executive Independent Directors two Non-Executive Directors and one WomanNon-Executive Director.
As on 31st March 2020 the Board comprises of 8 Directors out of which 1 Director isExecutive Chairman & Managing Director 3 Directors are Non - Executive including oneWoman Director. 4 Directors are Non-Executive Independent. The composition of the Board isin conformity with the requirements of Regulation 17 of the Listing Regulations AHDirectors are competent and experienced personalities in their respective fields.
The Board is headed by Sri.T. Kannan Chairman & Managing Director of the Company.During the year under review there were changes at the Board level as under:
Appointment of Mr.T.N.Ramanathan (DIN:02561794) as Non-Executive Independent Directorof the Company for first term of five consecutive years w.e.f. 01stApril 2019 was made bythe Board pursuant to the recommendation of Nomination and Remuneration Committee (NRC).The said appointment of Director was duly approved by the members of the Company at theAnnual General Meeting held on 17th June 2019.
Number of Board Meetings:
During the year under review Seven Board Meetings were held on 22.04.2019 24.07.201904.09.2019 18.10.2019 23.11.2019 30.01.2020 & 12.02.2020. The maximum intervalbetween any two consecutive Board Meetings did not exceed 120 days.
Pre-appointment of CMD:
Section 203 of the Companies Act 2013 requires a listed company to have a ManagingDirector/CEQ/Whole Time Director as one of the Key Managerial Personnel. In terms of theprovisions Sri T. Kannan the Chairman of the Company has been re-appointed as Chairmanand Managing Director duly recommended by the Nomination and Remuneration Committee andapproved by the Board of Directors He is already the Chairman and Managing Director ofM/s. Thiagarajar Mills Private Limited and accordingly his remuneration is fixed in such away that the total remuneration from both companies put together does not exceed thelimits as prescribed u/s. 197 of the Companies Act 2013.
The details of number and dates of meetings held by the Board and its Committeesattendance of Directors and remuneration paid to them is given separately in the attachedCorporate Governance Report.
The sitting fees paid to the Non-Executive Directors are within the limits prescribedunder the Companies Act 2013 and Rules thereon.
Retirement of Directors by Rotation:
Dr.(Smt.) Uma Kannan Director of the Company retires by rotation at the ensuingAnnual General Meeting and being eligible has offered herself for reappointment as aDirector of the Company. Being eligible she is proposed to be re-appointed as Director ofthe Company. The details of the proposed re-appointment of .Dr. (Smt.) Uma Kannan areforming part of the Corporate Governance report.
The Non-Executive Independent Directors have confirmed and declared that they are notdisqualified to act as a Non-Executive Independent Director in compliance with theprovisions of Section 149 of the Companies Act 2013 and the Board is also of the opinionthat the Non-Executive Independent Directors fulfill all the conditions specified in theCompanies Act 2013 making them eligible to act as Non-Executive Independent Directors.The Non-Executive Independent Directors have convened a meeting on 3001.2020.
To comply with the amended regulations as provided in Regulation 17(10) of the SEBI(LODR) Regulations the Board reviewed the evaluation process by applying the provisionsof Section 149 and Schedule IV to the Companies Act and the regulations as provided underthe SEBI Regulations in respect of the Independent Directors of the Company with thefollowing criteria:
*the performance of the Independent Directors
* fulfillment of the independence criteria as specified under the Companies Act 2013and regulations under SEBI Regulations.
The process of evaluation stating the objectivescriteria for evaluation.
periodic review of the evaluation process.
The Independent Directors who attended the meeting of the Board did not participate inthe discussion in respect of the evaluation of the Independent Director. There wassufficient quorum excluding the Independent Directors during the time of evaluation.
Declaration by Independent Directors
The Independent Directors have submitted their disclosures to she Board that theyfulfill all the requirements as stipulated in Section 149(6) of the Companies Act 2013and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 so as to quality themselves to act as Independent Directors under theprovisions of the Companies Act 2013 read with the relevant rules made thereunder.Further they have also declared that they are not aware of any circumstance or situationwhich exist or may be reasonably anticipated that could impair or impact their ability todischarge their duties with an objective independent judgment and without any externalinfluence. The Independent Directors have also confirmed that they have complied with theCompany's Code of Business Conduct & Ethics.
Code of Condent
Ail Directors Key Managerial Personnel and Senior Management of the Company haveconfirmed compliance with the Code of Conduct applicable to the Directors and employees ofthe Company The Code of Conduct is available on the Company's website www.vtmill.com. AllDirectors have confirmed compliance with provisions of Section 164 of the Companies Act2013.
The Board of Directors acknowledges the responsibility for ensuring compliance with theprovisions of Section 134(3)(c) read with Section 134(5) of the Companies Act 2013 andthe provisions as referred in SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 in the preparation of the annual accounts for the year ended on 31stMarch 2020 and state that:
i. in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;
ii. the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for that period;
iii. the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
iv. the Directors have prepared the annual accounts on a going concern basis:
v. the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively and the Company has adopted proper policies and procedures for ensuringorderly and efficient conducting of the business:
a) The management designed and implemented policies with respect to adherence toaccounting standards as a general requirement applied by a Company in preparing andpresenting financial statements
b) The management evolved a sound system for regular evaluation of the nature andextent of the risks to which the Company is exposed and to control risk appropriately
c) The board ensured the effective financial controls including the maintenance ofproper accounting records and the Company is not unnecessarily exposed to avoidablefinancial risks. They also contribute to the safeguarding of assets including theprevention and detection of fraud. The financial information used within the business andfor publication is reliable.
vi. the Directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.
Key Managerial Personnel
The following persons have been appointed as Key Managerial Personnel of the Company incompliance with the provisions of Section 203 of the Companies Act 2013:
a) Sri T. Kannan Chairman and Managing Director
b) Sri MRamanathan Chief Financial Officer
c) Sri S. Paramasivam Company Secretary
The Company has in place the SEBI guidelines pertaining to Corporate Governance. Duringthe year under consideration the Company had an Eight members Board of Directorsconsisting of one Chairman and Managing Director four Non-Executive IndependentDirectors three Non-Executive Director's of which one is a Woman Director.
The Corporate Governance Report giving the details as required under Regulation 34(3)read with Schedule V to SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 is given separately as Annexure I and forms part of this Report of theDirectors The Corporate Governance Certificate for the year ended on March 312020 issuedby M/s.CNGSN & Associates LLP Auditors of the Company is also attached as part ofAnnexure I and forms apart of this Report of the Directors.
The Company has formulated Insider Trading Code and Insider Trading Fair DisclosureCode in terms of Regulation 9 read with Schedule B and Regulation 8 read with Schedule Aof SEBI (Prohibition of Insider Trading) Regulations 2015 respectively and provided inthe company's website at www.vtmill.com . Mr.S. Paramasivam Company Secretary is theCompliance Officer responsible for compliance with the Insider Trading procedures. Asthere was no insider trading in the securities of the company the company has notreported any Insider Trading details to the Stock Exchange.
Sri T. Kannan. Chairman and Managing Director of the Company has given his certificateunder Regulation 17(8) read with part D of Schedule II of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 regarding the annual financial statements forthe year ended on 31 st March 2020 to the Board of Directors which is attached asAnnexure IX. The Chairman has given his certificate under Regulation 34(3) read with PartD of Schedule V of the above said Regulations in compliance with the Code of Conduct ofthe Company for the year ended March 31 2020 which is attached as Annexure VIII andforms a part of this Report of the Directors.
The Audit Committee consists of three Independent Directors and satisfies theprovisions of Section 177(2) of the Companies Act 2013. The Committee now comprisesMr.RM. Somasundaram as . Chairman and Mr. A. Mariappan and Mr.M.Murugesan as Members
The Company Secretary is the Secretary of the Committee. The details of all relatedparty transactions are placed periodically before the Audit Committee. During the yearthere were no instances where the Board had not accepted the recommendations of the AuditCommittee. The Company has in place a vigil mechanism details of which are available onthe Company's website www.vtmill.com
The Audit Committee has also been delegated the responsibility for monitoring andreviewing risk management assessment and minimization procedures implementing andmonitoring the risk management plan and identifying reviewing and mitigating ail elementsof risks which the Company may be exposed to.
The Audit Committee is empowered with monitoring the appointment of Key ManagerialPersonnel.
The details of terms of reference of the Audit Committee number and dates of meetingsheldattendance of tire Directors and remuneration paid to them are given separately inthe attached Corporate Governance Report.
Whistle Blower Policy / Vigil Mechanism
Pursuant to the provisions of Section 177 of the Companies Act 2013 and Regulation 22of Listing Regulations the Company has formulated Vigil Mechanism / Whistle Blower Policyto enable Directors and employees of the Company to report concerns about unethicalbehavior actual or suspected fraud or violation of Code of Conduct that could adverselyimpact the Company's operations business performance and / or reputation in a secure andconfidential manner. The said policy provides adequate safeguards against victimization ofDirectors/employees and direct access to Chairman of Audit Committee in exceptionalcases. The Vigil Mechanism / Whistle Blower Policy is available on the website of theCompany under the web-link https://www.vmiill.eom/investQr/Vigil-Mechanism-Whistle-Blower-Policy.pdf Your Company affirms that no personnel of the Companyhas been denied access to the Chairman of the Audit Committee and no complaint has beenreceived during the year under review.
Evaluation of the Board of its own performance Committee of the Board and IndividualDirectors:
Pursuant to the provisions of the Act and the Listing Regulations the Board hascarried out the annual evaluation of its own performance the individual Directors(including the Chairman) as well as an evaluation of the working of all Board Committees.
The Board reviewed and evaluated its own performance from the following angles:
Strategy and Implementation
* Corporate ethics
* Performance of the Individual Directors
* Performance of the Committees viz. Audit Committee Nomination and RemunerationCommittee Stakeholders Relationship Committee and Corporate Social ResponsibilityCommittee
The Board also evaluated the performance of the above referred Committees and concludedthat the Committees continued to operate effectively with full participation from allmembers and executive management of the Company.
The Board upon evaluation considered that the Board is well balanced in terms ofdiversity of experience. The Board noted that all Directors have understood theopportunities and risks to the Company's strategy and are supportive of the directionarticulated by the management team towards improvement. Corporate responsibility ethicsand compliance are taken seriously and there is a good balance between the core values ofthe Company and the interests of shareholders.
The Directors also expressed their satisfaction in all the above areas considering theCompany's performance in all fronts viz. New Product Development Sales and MarketingInternational business Employee relations and compliance with statutory requirements.
All the results of evaluation have been communicated to the Chairman of the Board ofDirectors.
Related Party Transactions:
During the year 2018-19 the company has entered into contracts or arrangements for aperiod of five years from 01.04.2019 to 31.03.2024 with such number of related partieswith the approval by the Board of Directors and the members of the company at the AnnualGeneral Meeting wherever necessary in respect of the following:
1. Sale purchase or supply of any goods or materials
2. Selling or otherwise disposing of or buying property of any kind
3. Leasing of property of any kind
4. Availing or rendering of any services
The details in respect of the material contracts or arrangements or transactions onarm's length basis carried on with the related parties have been furnished in Annexure V.
Corporate Social Responsibility Committee
A Corporate Social Responsibility Committee was constituted on April 242014 with SriT. Kannan as Chairman and M/s. K.Thiagarajan and RM. Somasundaram. Directors of theCompany as Members
The Committee met on 30.01.2020 during the year to review the CSR policies recommendfor contributions for CSR Activities carried out during the year and recommend foraccumulation of balance amount to be spent in subsequent years in view of the largerprojects to be undertaken by the educational institution to which the company iscontributing for CSR activities.
The Committee considered the social activities as referred in Schedule VII to theCompanies Act and recognizes that its operations impact a wide community of the public forpromoting health care including preventive health care and imparting education foruplifting the social status of the public. In structuring its approach to various aspectsof Corporate Social Responsibility the Company takes account of guidelines and statementsissued by various regulatory bodies. Social environment and ethical matters are reviewedby the Committee including the impact of such matters that may have on the Company'smanagement of risk.
The Company finalized the manner of implementation of the CSR Policy and spent a sum ofRs. 0.75 lakhs towards conducting eye camp for the public nearby the mills as apreventive health care activity and accumulated a sum of Rs.52.51 lakhs as unspent inview of undertaking infrastructure enhancement projects by the educational institution towhich the company is contributing for CSR activities. The details of the project amountof estimates and the amount spent for the projects undertaken and the unspent amounts hasbeen shown in Anncxure VII.
The CSR policy is available on the Company's website www.vtmill.com
The terms of reference of the Corporate Social Responsibility Committee number anddates of meetings held attendance of the Directors and remuneration paid to them aregiven separately in the attached Corporate Governance Report.
Prevention of Sexual Harassment
In compliance with the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 the Company has constituted an Internal Complaints Committeewith three employees and a NGO representative and Smt. Uma Kannan Director of the Companyis the Adviser to the Committee. The Board also has approved the prevention of SexualHarassment Policy and all employees especially women employees were made aware of thePolicy and the manner in which complaints could be lodged. The Committee has submitted itsAnnual Report and the same has been approved by the Board.
The following is reported pursuant to Section 22 of the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013:
|1. No. of Complaints of sexual harassment received ||NIL |
|2. No. of Complaints disposed off during the year ||NIL |
|3. No. of cases pending for more than ninety days ||NIL |
|4. No. of awareness programme conducted ||1 |
|5. Nature of action taken by the employer ||Not Applicable |
Nomination and Remuneration Committee
A Nomination and Remuneration Committee was constituted on April 242014 and as on 31stMarch 2020 Sri RM. Somasundaram is the Chairman an Independent Director and M/s. TKannan K. Thiagarajan and A. Mariappan arc Members of the Committee. The constitutionsatisfies the provisions of Section 178 of the Companies Act 2013 as well as the SEBIRegulations. The Company Secretary is the Secretary of this Committee.
During the year the Committee met once on 30.04.2019 for reviewing the Nomination andRemuneration Policy.
The Company's Remuneration Policy is available on the Company's website www.vtmili.comand annexed as forming part of this report as AnnexureX.
The details of terms of reference of the Nomination and Remuneration Committee numberand dates of meetings held attendance of the Directors and remuneration paid to them aregiven separately in the attached Corporate Governance Report.
Stakeholders Relationship Committee
The Stakeholders Relationship Committee now consist of Sri T.N.Ramanathan as Chairmanand Sri T. Kannan and K.Vethachalam as Members. The Company Secretary is the Secretary ofthe Committee as per the Regulation 20 of the SEBI (LODR) Regulations 2015 to have threeDirectors as Members of the Committee with one Independent Director Member. The Committeemet once during the year on 30.01.2020.
The Committee has delegated the responsibility for share transfers and other routineshare maintenance work to the Company Secretary and to M/s.KFin Technologies PrivateLimited (formerly known as Karvy Fintech Private Limited) the Registrars and ShareTransfer Agents of the Company. All requests for dematerialisation and rematerialisationof shares transferor transmission of shares and other share maintenance matters arecompleted within 30 days of receipt of valid and complete documents. The Committeeapproved all activities through Circular Resolutions and all those Circular Resolutionswere placed and discussed at the Board meetings. The Committee also reports to the Boardon matters relating to the shareholding pattern shareholding of major shareholdersinsider trading compliances movement of share prices redressal of complaints Reports onSCORES of SEBI and all compliances under the Companies Act 2013 and the listing agreementwith Stock Exchanges.
The shares of the Company are listed on the Bombay Stock Exchange. The Company's sharesare compulsorily traded in the dematerialized form. The ISIN number allotted isINE222F01029. The details of shareholding pattern distribution of shareholding and shareprices are mentioned separately in the attached Corporate Governance Report.
Transfer to Investor Education & protection Fund:
Transfer of shares:
During the year the Stake holder relationship committee has transmitted 654800 equityshares of the company into DEMAT account of the [EPF Authority held with NSDL (DP IDClient id IN300708 10656671) in terms of Provisions of Section 124(6) of the companies Act2013 and the related Rules These equity shares were the shares of 118 shareholders whoseunclaimed dividend pertaining to the year 2011-12 had been transferred to JEPF and who hadnot encashed their dividends for seven subsequent financial years.
Individual reminders were sent to concerned share holders advising them to encash theirdividend and the complete list of such shareholders whose shares were due for transferto 1E.PF was also placed in the website of company.
In terras of Section 139 of the Companies Act and the rules made thereon M/s CNGSN& Associates LLP Chartered Accountants Chennai (Firm Regn. No. 004915S/S200036) havebeen appointed as Auditors of the Company by the members at their meeting held on 23rdJune 2017 and the Auditors have been appointed for a period of five years from theconclusion of 70th Annual General Meeting till the conclusion of the 75th Annual GeneralMeeting The Auditors have already submitted certification u/s. 141 of the Companies Actand Peer Review Certificate in respect of their appointment as Auditors of the Company.
Pursuant to the provisions of Section 139 of the Companies Act 2013 read with rulesmade thereunder M/s CNGSN & Associates LLP Chartered Accountants Chennai (FirmRegn. No. 004915S/S200036 were appointed as Statutory Auditors of the Company to holdoffice till conclusion of the 75th Annual General Meeting (AGM) of the Company. M/s CNGSN& Associates LLP. Chartered Accountants Chennai with Sri. Chinnsamy Ganesan assigning partner have consented and confirmed their eligibility and desire to continue asStatutory Auditors of the Company for the Financial Year 2020-21. The Auditors havealready submitted certification u/s. 141 of the Companies Act and Peer Review Certificatein respect of their appointment as Auditors of the Company.
The Notes to the financial statements referred in the Auditors Report areself-explanatory There are no qualifications or reservations or adverse remarks ordisclaimers given by Statutory Auditors' of the Company and therefore do not call for anycomments under Section 134 of the Companies Act. 2013 The Auditors' Report is enclosedwith the financial statements in this Annual Report.
A Secretarial Audit was conducted during the year by the Secretarial Auditor Mr.M.K.Bashyam Practicing Company Secretary in accordance with the provisions of Section 204 ofthe Companies Act 2013. The Secretarial Auditor's Report along with. SecretarialCompliance Report (as required under the amended SEBI Regulations) is attached as AnnexureII and forms a part of this Report of the Directors There are no qualifications orobservations or remarks made by the Secretarial Auditor in his Report.
Pursuant to Provision of Section. 138 of Companies Act 2013 read with Companies(Accounts) Rules 2014 the Board of Directors on recommendation of Audit Committee hasappointed M/s. Sundaram & Srinivasan. Chartered Accountants as an Internal Auditorsof the Company. Internal Auditors submits their reports on quarterly basis to the AuditCommittee Based on the report of Internal Audit function corrective actions in therespective area are undertaken & controls are strengthened. Significant auditobservations and corrective actions thereon are presented to the Audit Committee of theBoard. The internal audit for the Q4 2019-20 was not completed due to lockdown and thesame will be completed in due course.
Cost Auditors and Cost Records
Pursuant to the provisions of Section 148 (1) of the Companies Act 2013 read withCompanies (Cost Records and Audit) Rules 2014 the Company was required to maintain costrecords. Accordingly the Company has duly made and maintained the Cost Records asmandated by the Central Government.
The Board of Directors had approved the appointment of Shri M. Kannan Cost Accountantas the Cost Auditor of the Company to audit the Company's Cost Records for the year2020-21 at a remuneration of Rs.40000/- plus applicable taxes and out-of-pocketexpenses.
The remuneration of the cost auditor is required to be ratified by the members inaccordance with the provisions of Section 148(3) of the Companies Act 2013 and Rule 14 ofCompanies (Audit and Auditors) Rules 2014. Accordingly the matter is being placed beforethe Members for ratification at the ensuing Annual General Meeting.
The Company has not accepted any deposits from the public and as such there are nooutstanding deposits in terms of the Companies (Acceptance of Deposits) Rules 2014.
The company does not have any deposit which is not in compliance with the CompaniesAct 2013.
Loans guaranties and investments
The Company has not granted any inter-corporate loan given guarantee or providedsecurity for availing loan by any other company. However the company has invested itsfunds in such number of companies and in such number of shares and securities in otherbodies corporate as referred to in Notes No. 06 and 10 of the Balance Sheet.
In compliance with Section 186 of the Companies Act 2013 loans to employees bearinterest at applicable rates.
Conservation of Energy Technology Absorption and Foreign Exchange Earnings and Outgo
The prescribed particulars of Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo required under section 134(3)(m) read with Rule 8(3) of theCompanies (Accounts) Rules 2014 is attached as Annexure IV and forms a part of thisReport of the Directors.
Particulars of Employees
The prescribed particulars of Employees required under Section 134(3)(q) read with Rule5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isattached as Annexure VI and forms a part of this Report of the Directors. There are noemployees drawing remuneration more than Rs. 102 Lakhs per annum or R.s.850000/- permonth.
Statement On Compliance With Secretarial Standards
The Directors have devised systems to ensure compliance with the provisions of allapplicable Secretarial Standards and that such systems are adequate and operatingeffectively. The Company is in compliance with the applicable Secretarial Standards issuedby the Institute of Company Secretaries of India and approved by the Central Governmentunder Section 118(10) of the Act.
Annexures forming a part of this Report of the Directors
The Annexures referred to in this Report and other information which are required to bedisclosed are annexed herewith and forms a part of this Report of the Directors:
I. Corporate Governance Report along with Certificate on Corporate Governance by theAuditor of the Company.
II. Secretarial Audit Report
III. Extract of the Annual Return in Form MGT-9.
IV. Particulars on Conservation of Energy Technology Absorption and Foreign ExchangeEarnings and Outgo.
V. Form AOC-2 for material contracts with Related Parties.
VI. Ratio of remuneration and Particulars of Employees.
VII. Annual Report on CSR spending.
VIII. Chairman & Managing Director's Certificate under Regulation 34(3) read withPart D of Schedule V to SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 on compliance of Code of Conduct.
IX. Certificate by Chairman and Managing Director and Chief Financial Officer underRegulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 on Financial Statements.
X. Remuneration Policy.
Your Directors record their sincere appreciation of the dedication and commitment ofall employees in achieving and sustaining excellence in all areas of the business. YourDirectors thank the Shareholders customers suppliers and Bankers and other stakeholdersfor their continuous support to the Company.
| ||For and on behalf of the Board of Directors |
|Kappalur Madurai. || |
|June 12 2020. ||CHAIRMAN AND MANAGING DIRECTOR |
Management Disclosure & Analysis:
The company's Sales Turnover has marginally increased by 73 lakhs from Rs. 15980 Lakhsto Rs. 16053 Lakhs registering an increase of 0.46%. The Profit after depreciation hasincreased by Rs.236 lakhs from Rs. 1400 Lakhs to Rs 1636 Lakhs. Though the totalcurrent tax provision (including deferred tax liability) has increased from 379 lakhs to426 lakhs the tax provision has come down due to capex in the form of machineryadditions. The Profit after tax has increased from Rs 1021 lakhs to 1210 lakhs as setout in the Directors' Report.
Key Financial Ratios:
|Ratios ||2018-19 ||2019-2020 ||% Change |
|Debtors Turnover ||113 days ||44 days ||(-) 61% |
|Inventory Turnover ||7% ||52% ||(-) 28% |
|Interest Coverage Ratio ||13.33 ||13.91 ||4% |
|Current Ratio ||13.64 ||6.77 ||(-) 50% |
|Debt Equity Ratio ||0.04 ||0.05 ||25% |
|Operating Margin ||9.48 ||1019 ||7.49% |
|Net Profit Margin ||6.13 ||7.59 ||23.82% |
|Return on Net Worth ||4.18 ||3.03 ||(-)7.51% |
Industry Structure and Developments:
Industry structure and developments has been elaborately stated in the Director'sReport.
Internal Control Systems and their Adequacy:
Internal Control Systems has been elaborately stated in the Director's Report.
The Company has a recruitment and training policy to meet its HR needs. The Company'sperformance on the Industrial Relations front continues to be quite satisfactory.
Certain statements in the "Management Discussion and Analysis Report" may beforward looking and are as required by applicable laws and regulations. Many factors mayaffect the actual results which could be different from what the Directors envisage interms of the future performance and outlook - the ever present risk factors.
Annexure I: Corporate Governance Report 2019-20
THE COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE:
The Company believes that Good Corporate Governance is essential for achieving Longterm corporate goals besides following highest standards of ethics transparency andintegrity to improve the performance at all levels and enhancing stakeholder's value.
The company's business objective and that of its Management and Employees is tomanufacture and market the products in such a way so as to create value that can besustained on a long term basis for all its stakeholders.
The Company in addition to compliance with regulatory requirementsalso endeavours toensure high standards of ethical conduct in the organization.
1. A Report on Corporate Governance is given below and Auditors certificate incompliance with the provisions of Corporate Governance is enclosed separately.
2. BOARD OF DIRECTORS
2.1. Composition and Category of Directors
The Board of Directors as on 12th June 2020 consists of Eight Directors of which thereare One Executive Director Three Non-Executive Directors and Four Independent Directorsand thus it is in compliance with SEBI Regulations. The details of the composition of theBoard of Directors are as follows:
|Name of the Director ||Category ||Particulars |
|Sri T.Kannan ||Chairman and Managing Director ||Executive Director |
|Dr. (Smt.) Uma Kannan ||Director ||Non-Executive Woman Director |
|Sri K.Thiagarajan ||Director ||Non-Executive Director |
|Sri RM.Somasundaram ||Director ||Independent Director |
|Sri A. Mariappan ||Director ||Independent Director |
|Sri M.Murugesan ||Director ||independent Director |
|Sri T.N.Ramanathan ||Director ||Independent Director |
|Sri K. Vethachalam ||Director ||Non-Executive Director |
2.2. Details of the Directors
The current composition of the Board of Directors complies with the provisions of SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 and the provisionsof Companies Act 2013.
In the present Board Sri.T. Kannan Chairman & Managing Director Dr.(Smt.) UmaKannan and Sri. K. Thiagarajan are related to each other.
None of the Directors on the Board is a member on more than 10 Committees as per therequirements of Regulation 26 of the SEBI (Listing Obligations & DisclosureRequirements) Regulations 2015. Necessary disclosures have been made by the Directors inthis regard.
The Board meets at least once in a quarter to review the performance of the Companyand also meets as and when to transact any special business that may arise.
Dr.(Smt.) Uma Kannan Director of the Company retires by rotation at the ensuing AnnualGeneral Meeting and being eligible has offered herself for reappointment as a Director ofthe Company. She is proposed to be re-appointed as a Director of the Company. The personalinformation about Dr.(Smt) Uma Kannan is given as below:
Dr.(Smt.) Uma Kannan was appointed as Woman Director of the Company on 25th March2015. She is
Doctorate in Sociology from Madurai Kamaraj University. She is the Director ofM/s.Thiagarajar Mills Pvt LimitedM/s.Thiagarajar Telekom Solutions Limited and ColourYams Limited. As such she possesses knowledge and experience in corporate affairs.
Dr. (Smt.) Uma Kannan does not hold any equity shares in the Company.
All Directors have certified that the disqualifications mentioned under sections164167 and 169 of the Companies Act 2013 do not apply to them. Independent Directorshave confirmed that they have complied with the Code for Independent Directors mentionedin Schedule IV of the Companies Act 2013 and that they are not disqualified to act as anIndependent Directors in compliance with the provisions of section 149 of the CompaniesAct 2013.
Independent Directors' Criteria:
The Board of Directors confirms that the Independent Directors fulfill the criteria inrespect of their independency as referred under the provisions of Section 149 and ScheduleIV to the Companies Act 2013 and under the regulations referred in the SEBI (LODR)Regulations as amended from time to time.
Familiarization Programme: At the time of induction the Company familiarizes theIndependent Directors with regard to their role & responsibilities industry outlookbusiness strategy Company's operations etc. Thereafter the Independent Directors areprovided with necessary documents reports internal policies and updates to familiarisethem with the Company's business policies procedures and practices at various Meetingsheld during the year.
2.3 Code of Conduct
The Code of Conduct laid down by the company which has been adopted by the Board ofDirectors is applicable to the Directors and all employees of the Company. This Code ofConduct emphasizes the Company's commitment to compliance with the highest standards oflegal and ethical behaviour. The Code of Conduct is available on the website of theCompany www.vtmill.com under heading 'Investor
Information'. All Directors and senior management have adhered to the Code of Conductof the Company during the year and have signed declarations of compliance to the Code ofConduct. The declaration signed by Chairman and Managing Director is given separately inthe Annual Report.
2.4. List of skilis/expertise or competence of Board of Directors:
The Board comprises of Members who have varied skills experience and knowledge toeffectively govern and direct the organisation. The skills and attributes of the Board canbe broadly categorised as follows:
* Governance skills (skills directly relevant to performing the Board's key functions);
* Industry skills (skills relevant to the textile industry);
* Financial skills (Skills relevant to Treasury and Banking Management)
* Accounting skills (Skills relevant to Accounting Functions)
* Administrative skills (Skills relevant to Administrative functions)
Details of listed entities where the Directors of the Company are Directors andcategory of Directorship:
|Directors ||Listed Entities ||Category of Directorship |
|Sri.T.Kannan ||TVS Motor Company limited ||Independent Director |
|Sri.T.Kannan ||Sundaram Brake linings Limited ||Independent Director |
2.5 Shareholding of Directors and Key Managerial Personnel
As on March 312020 following shares of the Company were held by Directors:
|Name ||Designation ||No. of shares |
|Sri.T. Kannan ||CMD ||585600 |
|Sri.K. Thiagarajan ||Director ||153600 |
|Sri RM. Somasundaram ||Director ||60000 |
No other Director or Key Managerial Personnel holds any shares in the Company.
2.6 Board Meetings Annual General Meeting and Attendance
During the year under review six Board Meetings were held and sitting fees have beenpaid to the Directors as detailed herein:-
|Director Name ||22.04.19 ||2407.19 ||04.09.19 ||18.10.19 ||23.11.19 ||30.01.20 ||12.02.20 ||Total |
| ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) |
|Uma Kannan ||5000 ||5000 ||5000 ||5000 ||5000 || ||5000 ||30000 |
|K. Thiagarajan ||5000 ||5000 ||5000 ||5000 ||5000 ||5000 ||5000 ||35000 |
|RM.Somasundaram ||5000 ||5000 ||- ||- ||5000 ||5000 ||5000 ||25000 |
|A. Mariappan ||5000 ||5000 ||5000 ||5000 ||5000 ||5000 ||5000 ||35000 |
|M. Murugesan ||- ||5000 ||- ||5000 || ||5000 ||- ||15000 |
|T.N.Ramanathan ||- || || || || || ||- ||- |
|K.Vethachalam ||5000 ||5000 ||- ||5000 ||5000 ||5000 || ||30000 |
|TOTAL ||25000 ||30000 ||15000 ||25000 ||25000 ||25000 ||20000 ||170000 |
No sitting fees paid to Sri T. Kannan as he is the Chairman and Managing Director.
The Company SecretaryS.Paramasivam is the Secretary to the Board of Directors and hasattended all meetings of the Board of Directors.
2.7. Board Committees
In line with the Companies Act 2013 and Regulation 17 of the SEBI Listing Regulations(LODR) 2015 the Company has constituted Audit Committee Corporate Social ResponsibilityCommittee Nomination and Remuneration Committee and Stakeholders Relationship Committee
The composition terms of reference attendance and other details of these Committeesare mentioned later in this Report.
2.8. Directorships and Committee membership in other companies
None of the Directors on the Board is a member of more than 10 Committees and Chairmanof more than 5 Committees [as specified in Regulation 26 of the SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015] across all listed companies in India ofwhich he is a Director.
Independent Directors do not serve in more than 7 listed companies. None of theIndependent Directors are whole-time directors in any listed Company.
Directorships and Membership of Committees in other companies held by Directors as onMarch 31 2019 and the Attendance of the Directors at the Board meetings and the AnnualGeneral Meeting is given below:
|Names of the Directors ||Category ||No. of Board Meetings attended ||Attendance at the last AGM held on 17.6.2019 ||No. of Other Director- ships in companies other than VTM ||No. of member ships in Board Committees ||Whether Chairman/ Member |
|1 Thiru T. Kannan ||ED ||6 || ||8* ||4 ||Chairman |
| || || || || ||5 ||Member |
|Thiru K.Thiagarajan ||NED ||7 || ||3* ||3 ||Member |
|Dr.(Smt.) Uma Kannan ||NED ||6 || ||3 ||- || |
|Thiru RM. Somasundaram ||NEID ||5 || ||3 ||2 ||Chairman |
| || || || || ||1 ||Member |
|Thiru A. Mariappan ||NEID ||7 || || ||1 ||Chairman |
| || || || || ||1 ||Member |
|Thiru M. Murugesan ||NEID ||3 || ||7 ||1 ||Chairman |
| || || || || ||3 ||Member |
|Thiru T.N.Ramanathan ||NEID ||2 || ||1 ||- ||- |
|Thiru K. Vethachalam ||NED ||5 || ||6 ||- ||- |
ID: Independent Director VTM - VTM LIMITED
NED-Non Executive Director. NEID-Non Executive Independent Director.
Note: * includes Directorship in 1 Company coming under Section 8 of the Companies Act2013.
Thiru K.Thiagarajan Director and Thiru.RM. Somasundaram Director have attended theAnnual General Meeting held on 17.06.2019.
3.1. Constitution and Composition: The Audit Committee was constituted during thefinancial year 2001 -2002 and reconstituted in view of the retirement of a director in2019-20. Accordingly the Audit Committee consists of following Directors as the members:
|Director ||Category |
|Thiru RM. Somasundaram ||Chairman |
|Thiru M. Murugesan ||Member |
|Thiru A Mariappan ||Member |
The Chairman and Managing Director is permanent invitee in all meetings. The CompanySecretary is the Secretary to the Audit Committee. All Directors are financially literateand Mr. A. Mariappan has accounting and related financial management expertise. BesidesMr.RM. Somasundaram also has sound technical knowledge and has finance expertise TheStatutory Auditors are invited to the meetings to discuss with the Directors the scope ofaudit their comments and recommendation on the accounts records risks internalprocedures and internal controls of the Company.
3.2. Terms of Reference: The terms of reference of the Audit Committee cover ail theareas mentioned under Part C of the Schedule II to the SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015 and section 177 of the Companies Act 2013. TheBoard has also included in the terms of reference of the Audit Committee the monitoringimplementing and review of risk management plan as required under Regulation 18 and as perPart C (Role of Audit committee) of Schedule II of the SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015. The broad terms of reference of the AuditCommittee therefore include review of financial reporting process and all financialresults statements and disclosures and recommending the same to the Board reviewing theinternal audit reports and discussing the same with the internal auditors reviewinginternal control systems and procedures to meet the statutory auditors and discuss theirFindings their scope of audit post audit discussion adequacy of internal auditfunctions audit qualifications if any appointment / removal and remuneration ofauditors changes in accounting policies and practices reviewing approval and disclosureof all related party transactions reviewing with the management the performance of thestatutory and internal auditors and their remuneration compliance with listingagreements/ SEBI(LODR)Reguiations and other legal requirements and the Company'sfinancial and risk management plan and policies and its implementation disaster recoverypolicies and compliance with statutory requirements.
3.3. Internal Audit: The Internal Audit Department of the Company is carrying theinternal audit periodically.
3.4. Attendance: During the financial year ended March 31 2020 five meetings of theAudit Committee were held:
|Director Name || ||Date of Meeting |
| ||22.4.19 ||24.07.19 ||18.10.19 ||30.01.20 ||12.02.20 ||Total |
| ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) ||(Rs.) |
|RM.Somasundaram ||5000 ||5000 || ||5000 ||5000 ||20000 |
|A Mariappan ||5000 ||5000 ||5000 ||5000 ||5000 ||25000 |
|M.Murugesan || ||5000 ||5000 ||5000 ||- ||15000 |
|TOTAL ||10000 ||15000 ||10000 ||15000 ||10000 ||60000 |
4 Remuneration to Directors:
Total Remuneration paid to Non-Executive Directors for attending meetings of the Boardand Committees during the year ended March 312020 is given below;
|Name of the Director ||Sitting Fees (For Board & Committee Meetings) |
|Thiru T. Kannan (Chairman and Managing Director) ||- |
|Thiru K.Thiagarajan ||Rs.45000/- |
|Thiru RM. Somasundaram ||Rs.60000/- |
|Thiru T.N.Ramanathan ||- |
|Thiru A. Mariappan ||Rs70000/- |
|Thiru M. Murugesan ||Rs.35000/- |
|Dr.(Smt.) Uma Kannan ||Rs.30000/- |
|Thiru K.Vethachalam ||Rs 30000/- |
5a. NOMINATION AND REMUNERATION COMMITTEE
Constitution and Composition: The Nomination and Remuneration Committee was constitutedon April 25 2014 in compliance with the provisions of Section 178 of the Companies Act2013 and Regulation 19 of SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015.
Sri.RM. Somasundaram an Independent Director is the Chairman of the Committee. Theother members are Sri.T.Kannan Sri.K.Thiagarajan and Sri.A.Mariappan.
Terms of Reference: The terms of reference of the Nomination and Remuneration Committeecover all the areas mentioned under Schedule II Part D of the SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015 and Section 178 of the Companies Act2013. The broad terms of reference of the Nomination and Remuneration Committee thereforeinclude recommending a policy relating to remuneration and employment terms of Whole TimeDirectors and senior management personnel adherence to the remuneration/employment policyas finally approved by the Board of Directors preparing the criteria and identify personswho may be appointed as Directors or Senior Management of the Company preliminaryevaluation of every Director's performance. Board diversity compliance of the Code forIndependent Directors referred to in Schedule IV of the Companies Act 2013 compliancewith the Company's Code of Conduct by Directors and employees of the Company reportingnon-compliances to the Board of Directors recommending draft of the report required underRule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014which will form part of the Directors Report to Shareholders monitor loans to employeesand any other matters which the Board of Directors may direct from time to time.
Attendance: During the financial year ended March 31 2020 one meeting of theNomination and Remuneration Committee was held on 22.04.2019 which were attended by allmembers. The sitting fee has been paid to the members of the Committee as under:
The Attendance of the Directors at the Committee meetings and remuneration paid to themare as under:
|Name of the Director ||Sitting Fees (Committee Meeting) |
|Thiru RM.Somasundaram-Chairman ||Rs. 5000 |
|Thiru T.Kannan-Member ||- |
|Thiru A.Mariappan-Member ||Rs.5000 |
|Thiru K.Thiagaraian - Member ||Rs5000 |
Remuneration Policy: During the year the Committee reviewed the Nomination andRemuneration Policy and as recommended by the Nomination and Remuneration Committee thepolicy has been approved by the Board of Directors.
The terms of reference of the Committee inter alia include the following:
Succession planning of the Board of Directors and Senior Management Employees;
Identifying and selection of candidates for appointment as Directors/ IndependentDirectors based on certain laid down criteria; identifying potential individuals forappointment as Key Managerial Personnel and to other Senior Management positions:
Formulate and review from time to time the policy for selection and appointment ofDirectors Key Managerial Personnel and senior management employees and theirremuneration:
Review the performance of the Board of Directors and Senior Management Personnel basedon certain criteria as approved by the Board. In reviewing the overall remuneration of theBoard of Directors and Senior Management the Committee ensures that the remuneration isreasonable and sufficient to attract retain and motivate the best managerial talent therelationship of remuneration to performance is dear and meets appropriate performancebenchmarks and that the remuneration involves a balance between fixed and incentive payreflecting short term and long term objectives of the Company.
Remuneration to Directors:
Sri T. Kannan the Chairman and Managing Director of the company is entitled to aremuneration not exceeding 5% of the Net Profits as computed u/s. 198 of the CompaniesAct 2013 and accordingly a sum ofRs.56.00 lakhs has been provided as remuneration for theyear 2019-20.
The Non-Executive Directors are entitled to sitting fees for every meeting of the Boardor Committee thereof attended by them. They are also entitled to commission not exceeding1% of the net profits of the Company.
5b. Corporate Social Responsibility Committee:
As required under section 135 of the Companies Act 2013 a Corporate SocialResponsibility Committee was constituted on April 252014 with Sri T.Kannan as Chairmanand Sri. K. Thiagarajan and Sri. RM. Somasundaram as Members.
The terms of reference of this Committee is to comply with the requirements of Section135 of the Companies Act 2013 the Companies (Corporate Social Responsibility Policy)Rules 2014 and all other relevant compliances.
The Committee met once during the year on 30th January 2020which was attended bySri.T.Kannan CMD Sri.K.Thiagarajan and RM. Somasundaram Directors of the Company forapproval of the CSR spending and excepting Sri.T.Kannan other Directors received asitting fee of Rs.5000/- for the meeting.
The CSR Policy which was approved by the Board is available on the Company's website.
The Board has accepted all the recommendations of all Committees.
Separate Meeting of Independent Directors:
The Independent Directors of the company M/s. RM. Somasundaram A.Mariappan andM.Murugesan met on 31 st January 2020 without the attendance of Non-Independent Directorsand members of management. They deliberated and reviewed the performance of theNon-Independent Directors and the Board as a whole. Besides they assessed the qualityquantity and timeliness of flow of information between the Company management and theBoard members that is necessary and essential for the Board to effectively and reasonablyperform their duties
6. STAKEHOLDERS RELATIONSHIP COMMITTEE
The Committee considered and reviewed the Terms of Reference of the Committee takinginto account the additional role of SRC as amended under Schedule II Part D(B)of the SEBI(LODR) Regulations
Constitution and Composition: The Stakeholders Relationship Committee has beenreconstituted in terms of Regulation 20 of the SEBI (LODR) Regulations duly amendedconsisting of Sri T.N. Ramanathan an Independent Director as Chairman and Sri T. Kannanand Sri.K. Vethaehalam as Members of the Committee The committee met once during theyear.
The Stakeholders' Relationship Committee has through Circular resolutions approvedduring the year the transfers transmissions and demat requests. Mr.S. ParamasivamSecretary of the Company who is also the Secretary and Compliance Officer for theCommittee.
During the year Nine grievances (including one outstanding at the beginning ofyear)regarding non-receipt of shares applied for transfer/transmission non-receipt ofdividend Balance Sheet and related matters were received from the shareholders and allwere redressed. There was no shares pending for . transfer at the close of the year.
Information on Unclaimed Dividend:
During the year the Stake holder relationship committee of directors has transmitted654800 equity shares of the company into DEM AT account of the IEPF Authority held withNSDL (DP ID Client id IN300708 10656671) in terms of Provisions of Section 124(6) of thecompanies Act 2013. and the related IEPF Rules. These equity shares were the shares of 118shareholders whose unclaimed dividend pertaining to the year 2011-12 had been transferredto IEPF and who had not encashed their dividends for seven subsequent financial years.
Individual reminders were sent to concerned share holders advising them to encash theirdividend and the complete list of such shareholders whose shares were due for transfer toIEPF was also placed in the website of company.
Pursuant to provisions of the Companies Act 2013 Company is committed in making timelypayment of dividend.
Distribution of Shareholding as on 31.03.2020:
|No. of Shares held ||No. of |
|% of |
|No. of Shares ||% of |
|Up to 5000 ||2769 ||90.52 ||2459227 ||611 |
|5001 - 10000 ||116 ||3.79 ||784639 ||1.95 |
|10001 - 20000 ||77 ||2.52 ||1117651 ||2.78 |
|20001 - 30000 ||36 ||1.18 ||924997 ||2.30 |
|30001 - 40000 ||16 ||0.52 ||582380 ||1.45 |
|40001 - 50000 50001 - ||4 ||0.13 ||180374 ||0.45 |
|100000 100001 - ||18 ||0.59 ||1388531 ||3.45 |
|above ||23 ||0.75 ||32789801 ||81.51 |
|Total ||3059 ||100.00 ||40227600 ||100.00 |
Shareholding pattern as on 31st March 2020:
|Shareholders ||No. of Shares held ||% of total shares held |
|Promoters ||30169700 ||75.00 |
|Corporate Bodies ||384397 ||0.96 |
|Public ||9439100 ||23.46 |
|NRI's ||234403 ||0.58 |
|Total ||40227600 ||100.00 |
The Company has not issued any ESOP to its Employees / Directors.
Dematerialisation of shares:
The shares of the Company have been dematerialized and the unique ISIN number allottedfor the Company as under:
ISIN : INE222F01029
Currently 94.96% of the total shares have been dematerialised.
The Shares held by Promoters have all been dematerialised.
Listing at Stock Exchanges:
|SI.No Name of the Exchange ||Code ||Address |
|1 Bombay Stock Exchange Ltd ||532893 ||Regd. Office: Floor 25 PJ Towers Dalai Street MUMBAI - 400 001 |
|TRADING SYMBOLAT BSE ||: VTM |
|Demat ISIN No. ||: INE222FG1029 |
|Share Price movements: || |
|Market price data: Exchange ||: BSE |
|Month ||HIGH ||LOW |
| ||Rs. ||Rs |
|APRIL '19 ||28.90 ||24.00 |
|MAY '19 ||30.00 ||27.50 |
|JUNE '19 ||28.35 ||25.00 |
|JULY '19 ||26.75 ||23.00 |
|AUGUST '19 ||25.00 ||23.00 |
|SEPTEMBER '19 ||28.00 ||24.10 |
|OCTOBER '19 ||26.45 ||2420 |
|NOVEMBER 19 ||2690 ||24.30 |
|DECEMBER 19 ||25.90 ||24.00 |
|JANUARY '2020 ||25.00 ||23.10 |
|FEBRUARY '20 ||26.00 ||22.00 |
|MARCH '20 ||23.80 ||18.00 |
The share quotations are stated for the Re 1/- Face value of the company's equityshare.
Stock Options: Nil.
Plant Location: Sulakarai Virudhunagar Pin:626003
6.1 Compliance Officer : Mr. S. Paramasivam Company Secretary is the Secretary of thisCommittee and the Compliance Officer and his contact details are given below :
Mr. S. Paramasivam
Company Secretary VTM Limited
Sulakarai Virudhunagar INDIA
Phone : 0452 -2482595-Ext 549 Email : complianceofficer@vtmiU.com
|6.2 Details of Complaints from Shareholders: |
No. of complaints remaining unresolved as on 31.03.2019
|No. of complaints/Requests received during the year ||8 |
|No. of complaints/Requests resolved during the year ||9 |
|No. of complaints unresolved as on 31.03.2020 ||0 |
7. GENERAL BODY MEETINGS
Particulars of last three Annual General Meetings are given below Details of the lastthree Annual General Meetings (AGM).
|AGM for the Financial Year ended ||Date & Time of AGM |
|31st March 2019 ||17th June 2019 at 12.00 Noon |
|31st March 2018 ||22nd June 2018 at 3.00 pm |
|31st March 2017 ||23rd June 2017 at 12.00 Noon |
EGM / Postal Ballot meetings:
There was no EG M conducted during the financial year ended 31.3.2020
All the resolutions set out in the AGM Notice was passed by the Shareholders(e-voting).
The Annual General Meeting was held at the Registered Office of the Company.
6.1 Pledge of shares held by Promoters: No pledge has been created by the Promoters onthe equity shares held as on March 31.2020.
7.2 Special resolutions:
The company has neither passed special resolution nor resolution requiring postalballot in the Annual General Meeting held on June 172019.
At the ensuing 73rd Annual General Meeting to be held on 5th August 2020 no resolutionis proposed to be passed by postal ballot.
7.2.1 Pursuant to section 108 and other applicable provisions of the Companies Act2013 read with the Companies (Management and Administration) Rules 2014 and otherapplicable requirements voting at the 73rd Annual General Meeting will be made throughelectronic voting. The electronic voting period commences on 31st July 2020 (9:00 am) andends on 3rd August 2020 (6:00 pm) both days inclusive.
7.2.2 Scrutinizer for electronic voting: Mr. I.B. Harikrishna of Akshaya CorporateSolutions Private Limited. Practising Company Secretaries (C.P No 5302) has been appointedas the Serutinizer to serutinize the electronic voting process in a fair and transparentmanner and to give his report to the Chairman.
8.1 Details of transactions with related parties have been reported in the Notes toAccounts. All the transactions with related parties are at arm's length basis. Alltransactions entered into with Related Parties as defined under the Companies Act. 2013and as per Regulation 23 of the SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015 during the financial year were in the ordinary course of business and onan arm's length pricing basis.
There were no materially significant transactions with the related parties during theyear which were in conflict with the interests of the company and that require approvalof the company in terms of SEBI (LODR) Regulations.
The Transactions with the related parties of routine nature have been reported as perInd AS 24 notified under Companies (Indian Accounting Standards) Rules 2015.
8.2 Disclosure of Accounting Treatment: Pursuant to the notification issued by theMinistry of Corporate Affairs dated 16th February 2015 relating to the Companies (IndianAccounting Standards) Rules 2015 the Company has adopted "Ind AS" with effectfrom 1st April 2017. Accordingly the Financial Statements for the year 2018-19 have beenprepared in compliance with the Companies (Indian Accounting Standards) Rules 2015.
8.3 Suitable disclosure as required by the Accounting Standards (AS 18) has been madein the notes to the Ind AS Financial Statements.
8.4 There were no instances of non-compliance by the Company or any penalties orstrictures imposed on the Company by stock exchanges or SEBI or any statutory authority onany matter related to capital markets during the last three years.
8.5 The Company has in place an Employee Concern (Whistle Blower) which is alsoavailable on toe Company's website. No personnel has been denied access to the AuditCommittee to lodge their grievances
8.6 All mandatory requirements have been appropriately complied with.
8.7 The Management Discussion and Analysis Report forms a part of the Directors'Report.
8.8 No presentations were made to institutional investors and analysts during the year.
8.9 The Company does not have any Subsidiary or Associate.
8.10 There have been no public issues rights issues or other public offerings duringthe past five years. The Company has not issued any GDRs/ADRs/Warrants or any convertibleinstruments.
a) Related Party Transactions
All transactions entered into with Related Parties as defined under the Companies Act2013 and the Listing Regulations during the financial year 2019-20 were in the ordinarycourse of business and arms length basis and approval of the Audit Committee was alsoobtained. Necessary disclosures regarding Related Party Transactions are given in thenotes to the Financial Statements.
The Board has approved a policy for Related Party Transactions and the same has beenuploaded on the website of the Company. The web-link thereto is as underhttps://www.vtmltd.com/ imageVmveslor/Policy_on_ReIated_Party_Transactioris.pdf
b) Compliance with Indian Accounting Standards(Ind-AS)
In the preparation of the financial statements the Company has followed the accountingpolicies and practices as prescribed in the Indian Accounting Standards (IndAS). Thesignificant accounting policies which are consistently applied have been set out in theNotes to the Financial Statements. There is no deviation in following the treatmentsprescribed in IndAS in preparation of financial statements for the year 2019-20.
c) Statutory Compliance. Strictures and Penalties
The Company has complied with all the requirements of the Stock Exchanges as well asthe regulations and guidelines prescribed by the Securities and Exchange Board of India(SEBI). There were no penalties or strictures imposed on the Company by Stock Exchanges orSEBI or any statutory authority on any matter related to capital markets during the lastthree years.
The Company has obtained Annual Compliance Certificate for the year ended 31st March2020 as per SEBI Circular from Mr. Bhasyam Practicing Company Secretary confirmingcompliance with SEBI regulations.
d) CEO & CFO Certification
The CMD Sri.T.Kannan and CFO Sri.M.Ramanathan have certified to the board with regardto the financial statements and other matters as required by the SEBI. ListingRegulations. The certificate is appended as an Annexure to this report. They have alsoprovided quarterly certificates on financial results while placing the same before theBoard pursuant to Regulation 33 of the SEBI Listing Regulations.
e) Vigil Mechanism / Whistle Blower Policy
Pursuant to the provisions of Section 177 of the Companies Act 2013 and Regulation 22of Listing Regulations the Company has formulated Vigil Mechanism / Whistle Blower Policyto enable Directors and employees of the Company to report concerns about unethicalbehaviour actual or suspected fraud or violation of Code of Conduct that could adverselyimpact the Company's operations business performance in a secure and confidentialmanner. The said policy provides adequate safeguards against victimization ofDirectors/employees. The Vigil Mechanism / Whistle Blower Policy is available on thewebsite of the Company under the web-linkhttps://www.vtmlid.com/images/investor/Whistle-Blower-Pol.icy-Vigi.I-Mechanism.pdf . TheCompany affirms that no personnel of the Company has been dented access to the AuditCommittee to lodge their grievances.
f) Certificate on Non-disqualification of Directors
The Company has obtained certificate from Mr. M.Bhasyam Practising Company Secretaryconfirming that none of the Directors of the Company have been debarred or disqualified bythe Securities and Exchange Board of India / Ministry of Corporate Affairs or any suchauthority from being appointed or continuing as Director of the Company and the same isalso attached to this Report
The Company does not have subsidiary or Associate.
9. MEANS OF COMMUNICATION
9.1 Quarterly results are published in the Business Standard and the Tamil versionthereof in Malai Malar the day after the Board Meeting where the results are approved.These financial results and quarterly shareholding pattern are electronically transmittedto the stock exchanges and are also uploaded on the Company's website www.vtmill.com.
9.2 Shareholder communication including Notices and Annual Reports are being sent tothe email addresses of Members available with the Company and the Depositories. AnnualAccounts are sent to Members at least 25 days before the date of Annual Genera! Meeting.
The Management Discussion and Analysis Report forming part of the Annual Report isenclosed [Regulation 34 and Schedule V of the Listing SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015.]
9.3 The Company's website:
www.vtmill.com makes online announcements of Board Meeting results of the quarterlyfinancial results announcement of the date of Annual General Meeting and proposeddividend and other announcements. Copies of Notices sent to Shareholders are alsoavailable on the website.
9.4 Address for communication:
All communication regarding share transactions change of address bank mandatesnominations etc. should be addressed to the Registrars and Share Transfer Agents of theCompany at the following address:
Registrar & Transfer Agent:
KFin Technologies Pvt. Ltd.
(Unit: VTM LIMITED)
Karvy Selenium Tower BPlot No 31 & 32.
Financial District Nanakramguda
Serilingampally Mandai Hyderabad - 500 032.
Ph:+9l 040 67161518
Contact Person: Mr.D.SURESH BABU- Manager - RIS.
The shareholders may also address their correspondence to:-
VTM LIMITED Sulakarai
VTM LIMITED Chairman's Office:
Thiagarajar Mills Premises Kappalur Madurai-625 008.
Grievances if any. may also be addressed to the Company Secretary at email atcompliance officer @vtmill.com
Shareholders are requested to mention their Folio Nos. DP-ID and Client ID in ease ofdemat shares phone and mobile nos. and their Email ID so that the Company/ComplianceOfficer can contact them and redress their complaints immediately. However forinstructions like change of bank mandate change of address transfers & transmissionof shares etc. letters duly signed by the Shareholders concerned should be sent otherwisesuch requests cannot be processed by the Registrars. Email ID of Shareholders will have tobe registered with the Company to enable the Company or the Registrars to communicateelectronically.
General Shareholders Information
|1. Date Time and Venue of the Annual General Meeting. ||Through Video Conferencing or Other Audio Visual Means(QAVM)on 5th August2020 at 12.00 NOON. |
|2. Dates of Book Closure/Record date for Financial Year 2019-20 ||Register of Members will be closed from 30.7.2020 to 4.8.2020 |
|3. Results for Quarter ending June 30 2020 (Provisional) ||4th Week of July 2020. |
|Results for Quarter ending September 30 2020 (Provisional) ||: 3rd Week of October 2020. |
|Results for Quarter ending December 31 2020 (Provisional) ||: 3rd Week of January 2021. |
|Financial Calendar - 1st April 2020 To 31st March 2021 (Audited) ||: 4th Week of April 2021. |