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W S Industries (India) Ltd.

BSE: 504220 Sector: Engineering
NSE: WSI ISIN Code: INE100D01014
BSE 00:00 | 23 Apr 0.87 -0.03






NSE 00:00 | 23 Apr 0.90 0.05






OPEN 0.88
52-Week high 8.98
52-Week low 0.79
Mkt Cap.(Rs cr) 2
Buy Price 0.87
Buy Qty 985.00
Sell Price 0.94
Sell Qty 1000.00
OPEN 0.88
CLOSE 0.90
52-Week high 8.98
52-Week low 0.79
Mkt Cap.(Rs cr) 2
Buy Price 0.87
Buy Qty 985.00
Sell Price 0.94
Sell Qty 1000.00

W S Industries (India) Ltd. (WSI) - Director Report

Company director report


The Members

Your Directors hereby present the Fifty Fifth Annual Report and the Audited FinancialStatements of the Company for the Financial Year ended 31st March 2018. The salienthighlights (in the Ind AS format) are provided in the table below:

(Rs. in Million)

For the period ended

31s'March 2018 31s' March 2017
Sales and other operational income 22.54 14.65
Other Income 11.67 17.00
Total Income 34.21 31.65
Gross Profit / (Loss) from continuing Operations 27.26 (154.93)
Less : Depreciation 91.67 91.37
Interest /Finance Charges (0.50) 1.99
Net Profit / (Loss) for the year from continuing operations (63.91) (248.29)
Provision /(withdrawal) for Income Tax / Deferred Tax - -
Net Profit /(Loss) for the year after Tax from continuing operations (63.91) (248.29)
Net Profit/(Loss) for the year after Tax from discontinued operations 383.77 219.16
Net Profit/(Loss) for the year after Tax 319.86 (29.13)
Profit / (Loss) brought forward from the previous year (2425.54) (2393.00)
Other Comprehensive lncome/(Loss) arising from discontinued operations (3.41)
Surplus/(Deficit)/ carried to Balance Sheet (2105.68) (2425.54)

1. Results of our operations

During the year under review production remained suspended in the Chennai and Vizagplants. The Insulator business unit generated miscellaneous sale of Rs. 22.54 million.However there was no sales in the Turnkey Projects division.

2. Dividend

No dividend has been proposed on the Equity shares.

The Directors also regret their inability to recommend any payment of contracteddividend on Preference Share Capital.

3. Reserves

Since the Company has suffered losses no transfer to reserve is provided for.

4. Particulars of loans guarantees or investments

Loans guarantees and investments covered under Section 186 of the Companies Act 2013form part of the notes to the Financial Statements provided in this Annual Report.

5. Transfer of Equity Shares relating to unpaid Dividend to Investor Education andProtection Fund

In terms of Investor Education and Protection Fund Authority (Accounting AuditTransfer and Refund) Amendment Rules 2017 your Company has transferred 268337 EquityShares which are unpaid/ unclaimed shares to the Investor Education and Protection Fund.

6. Fixed Deposits

Your Company has not accepted any deposits from public in terms of provisions ofCompanies Act 2013.

7. Corporate Governance

A separate report on Corporate Governance along with a Certificate of Compliance formspart of this report vide Annexure - 1.

8. Subsidiaries

During the period under review your Board of Directors have reviewed the FinancialStatements of W.S. T&D Limited (100% subsidiary).

Your Company has in accordance with Section 129 (3) of the Companies Act 2013 preparedthe Consolidated Financial Statements for the Financial Year ended 31st March 2018 whichforms part of the Annual Report. Further the statement containing the salient features ofthe Financials of the subsidiaries in the Form AOC 1 is attached as Annexure 2 to thisReport.

In accordance with Section 136 of the Companies Act 2013 the audited consolidated andstandalone financial statements are available on our website .

9. Related Party Transactions.

All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions during the year which in the opinion ofthe Board may have potential conflicts with the larger interests of the Company. Thedetails of transactions with related parties have been disclosed in form AOC-2 as Annexure3 and form part of this Annual Report.

The policy on related party transactions is available in the Company's website.

10. Conservation of Energy Technology Absorption and Foreign Exchange Earnings andOutgo

Since production activity was suspended in both the plants we are unable to report onthe particulars prescribed under Section 134 of the Companies Act 2013 read with rule 8(3) of the Companies (Accounts) Rules 2014 relating to conservation of energy andtechnology absorption.

Foreign Exchange Earnings:

Foreign Exchange Inward - NIL Foreign Exchange Outward - NIL

11. Extract of Annual Return

As provided under section 92 (3) of the Companies Act 2013 the extract of AnnualReturn of the Company is annexed herewith as Annexure 4 in the prescribed Form MGT 9 whichforms part of this Report.

12. Material changes and commitment affecting financial position between the FinancialYear ended 31s1 March 2018 and the date of this Report

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.

Material changes and commitments affecting the financial position of the Company whichhave occurred between the end of the financial year of the company to which the financialstatements relate and the date of this report are as follows: The Company has executedSettlement Agreements and other related agreements with Edelweiss Asset ReconstructionCompany Limited Allium Finance Limited and Debenture holders of the Company for thesettlement of their dues at a consolidated amount of Rs.345 cr. over a specified period oftime with initial payment of Rs. 200 cr along with an amount of Rs.40 cr to continue as"Restructured Debt" secured by plant and all other assets and properties of theVizag unit on a pari passu basis and consequent withdrawal/ standstill of relatedlitigation.

The litigation with Comfortable Abode Private Limited (formerly Mantri Premier HomesPrivate Limited) and Mantri Developers Private Limited was settled with payment ofRs.91.14 cr. In addition a one-time settlement was completed with State Bank of India tosettle all its dues at Rs.12.53 crs.

For the above financing of Rs. 301.63 cr. was availed with security through mortgageon part of the Company's land at Chennai.

13. Risk Management Policy

The Board had established Risk Management policy which formalizes the Company'sapproach to overview and manage material business risks.

14. Corporate Social Responsibility

Section 135 of the Companies Act 2013 pertaining to Corporate Social Responsibility isnot applicable in our case.

15. Internal Financial Controls

Your Company has internal financial controls with respect to financial reporting.

16. Directors and Key Managerial Personnel (KMP)

Mr.J.Sridharan has been appointed as an Additional Director and at the Annual GeneralMeeting held on 14h November 2017 shareholders appointed him as an IndependentDirector of the Company for a term of 5 years.

Mr.B.Swaminathan is Chief Financial officer and Compliance Officer of the Company.

No employee draws remuneration in excess of the limits prescribed under Rule 5(2) ofChapter XIII the Companies (Appointment and Remuneration of Managerial Personnel Rules2014. Remuneration drawn by KMP have been disclosed in Annexure-4 to Board's report.Therefore details pertaining to Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 have not been provided.

17. Declaration by Independent Directors:

The Company has received necessary declarations from each Independent Director underSection 149(7) of the Companies Act 2013 that he meets the criteria of Independence laiddown in and Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

18. Board Evaluation

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Boards' performance and performance of theNon-independent Director were considered/evaluated by the independent directors at theirmeeting without the participation of the non-independent director and key managerialpersonnel. The Board has carried out an annual appropriate evaluation of its ownperformance the directors individually as well as the evaluation of the working of itsvarious committees.

19. Meetings of the Board

The details of the number of meetings of the Board held during the Financial Year 2017-18 along with attendance details of each director forms part of the Corporate GovernanceReport of this Annual Report.

20. Committees

The details regarding Committees of Board of Directors of the Company are given in theCorporate Governance Report of this Annual Report.

21. Auditors Statutory Auditors

M/s. S B S B and Associates Chartered Accountants Chennai (Firm RegistrationNo.012192S) were appointed as Statutory Auditors of the Company for a period of five yearsat the Annual General Meeting held on 14h November 2017. The said appointmentis placed for the ratification of the shareholders at the ensuing Annual General Meeting.

With reference to the Auditor's Report issued by SBSB & Associates CharteredAccountants the explanation/comments against each Disclaimer of opinion and Emphasis ofmatter is annexed herewith as "Annexure - 5"

Secretarial Auditor

Pursuant to the requirements of Section 204 (1) of the companies Act 2013 read withrules made thereunder Ms.Lakshmmi Subramanian (Membership No. 3534 CP No. 1087) PartnerM/s.Lakshmmi Subramanian & Associates was appointed as the Secretarial Auditor toconduct the Secretarial Audit of the Company for the Financial Year 2017-18. The Report ofthe Secretarial Auditor is enclosed as Annexure 6 to this Report.

22. General

Your Company informs with deep regret about the demise of the Chairman Mr. V.Srinivasan. He was associated with the Company from its incorporation and his sagacityand active contribution to the establishment and achievements of the Company over theyears was immense.

The Company is in the process of implementing settlements with the surplus workers /executives both at Chennai and Vizag plants.

Special resolutions were passed through Postal Ballot for Increase in borrowing powerin terms of Section 180 (1) (c) of the Companies Act 2013 creation of charge / mortgageetc. on Company's movable or immovable properties in terms of Section 180 (1) (a) of theCompanies Act 2013 and to convert portion of the unpaid interest on debt into equity andissue of equity shares to EARC SAF -1 TRUST EARC TRUST - SC 168 and EARC TRUST - SC 209through preferential issue.

Accordingly 5120818 Equity shares consisting of 2434358 Equity shares to EARC SAF -1 TRUST 1901268 Equity shares to EARC TRUST SC 168 and 785192 Equity shares to EARCTRUST - SC 209 of Rs.10/- were allotted through preferential issue.

The Company has in accordance with generally accepted accounting practice disclosedthe impact of pending litigations on its financial position in its financial statements.

23. Sexual Harassment of Women at Workplace (Prevention Prohibition & Redressal)Act 2013

During the year under review there were no complaints under this Act.

24. Management Discussion and Analysis Report.

As highlighted in the previous year the difficulties faced by the Company have beenprimarily caused by steep rise in the price of raw material coupled with reduction insales volume higher competition in the industry dumping by foreign competitors andeconomic slowdown which all resulted in a liquidity crunch. Due to mounting losses lackof working capital and other support company had suspended manufacturing operations atboth plants.

With reference to the trespass that had taken place in part of the premises of thefactory at Chennai your Company took vigorous and appropriate judicial action and filedthe necessary complaints to protect the ownership of its property.

However attention is drawn to Note No. 55 of Financial Statements about this matterand potential loss of material arising there of which can be quantified only after properassessment which could not be done so far because of labour unrest and such trespass.

Various steps to make a beginning to financially restructure the Company have beentaken which have been detailed in point 12 above.

Your Company has an adequate Risk Management Policy which would help in identifying andmitigating enterprise risks. The increasing litigation and the non-availability of capitalto revive the operations continue to remain the primary concerns for your Company.

Your Company has adequate internal control systems as necessary with the requirementsof the Companies Act 2013.

25. Director's Responsibility Statement

In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that:

a. In the preparation of the annual accounts the applicable accounting standards havebeen followed. In accordance with the notification issued by the Ministry of CorporateAffairs the Company has adopted Indian Accounting Standards (referred to as "IndAS") notified under the Companies (Indian Accounting Standards) Rules 2015 witheffect from April 1 2017. Previous periods have been restated to Ind AS format.

b. The directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that were reasonable and prudent so as to give a true andfair view of the state of affairs of the Company for the financial year ended 31st March2018 and of the profit or loss of the Company for the period under review.

c. The directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities.

d. The directors have prepared the annual accounts on a going concern basis.

e. The directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively taking into consideration the current circumstances and

f. The directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such system were adequate and operating effectively takinginto consideration the current circumstances.

26. Listing of Shares:

The equity shares of the Company are listed on the National Stock Exchange of IndiaLimited (NSE) and BSE Limited (BSE). The listing fee for the Financial Year 2018-19 hasalready been paid to the credit of both the Stock Exchanges.

27. Acknowledgement

Your Directors would like to express their sincere appreciation for the assistance andcooperation received from the financial institution Government authorities customersvendors and members during the year under review. Your Directors also wish to place onrecord their appreciation for the commitment shown by the Company's personnel who havebeen functioning under very trying circumstances.

For and on behalf of the Board

Chennai R.Karthik K.Rajasekar
14h August 2018 Director Director