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Wendt India Ltd.

BSE: 505412 Sector: Engineering
NSE: WENDT ISIN Code: INE274C01019
BSE 00:00 | 22 Mar 2960.00 0






NSE 00:00 | 25 Mar 3005.40 -0.05






OPEN 2970.00
52-Week high 4013.85
52-Week low 2372.00
P/E 31.54
Mkt Cap.(Rs cr) 592
Buy Price 2940.00
Buy Qty 10.00
Sell Price 2960.00
Sell Qty 10.00
OPEN 2970.00
CLOSE 2960.00
52-Week high 4013.85
52-Week low 2372.00
P/E 31.54
Mkt Cap.(Rs cr) 592
Buy Price 2940.00
Buy Qty 10.00
Sell Price 2960.00
Sell Qty 10.00

Wendt India Ltd. (WENDT) - Director Report

Company director report

(Including Management Discussion and



The Board of Directors have pleasure in presenting the 36th Annual Report of theCompany together with the Audited Financial Statements for the year ended 31st March 2018.The Management Discussion & Analysis Report which is required to befurnished as per SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015has been included in the Directors Report to avoid duplication and repetition.


According to the International Monetary Fund (IMF) the global economy is experiencinga near synchronous recovery. Roughly three-quarters of the countries experiencedimprovements in their growth rates. The recovery is driven by improvement in world tradein goods and services upswing in commodity prices accommodative monetary policies inadvanced regions buoyant demand conditions etc. However there are geopolitical andgeo-economics risks due to war in the Korean peninsula; political upheaval in the MiddleEast; aggressive output cuts by Saudi Arabia (and Russia) which could force oil priceseven higher; China's unprecedented credit surge in the form of capital controls and tradetension.

India can be rated as among the best performing economies in the world as the averagegrowth during the last three years being around 4 percentage points higher than globalgrowth and nearly 3 percentage points higher than that of Emerging Market and DevelopingEconomies.

The Indian Government underlines that due to the launch of transformational Goods andServices Tax (GST) reform on July 1 2017 resolution of the long-festering Twin BalanceSheet (TBS) problem by sending the major

GST Go Live stressed companies for resolution under the new Indian Bankruptcy Codeimplementing a major recapitalization package to strengthen the public sector banksfurther liberalization of FDI and the export uplift from the global recovery the economybegan to accelerate in the second half of the year. The Central Statistics Office (CSO)has estimated the GDP growth to be 6.5% in 2017-18. Also India improved its ranking by 30spots on the World Bank's Ease of Doing Business rankings.

(Rs in Lakhs)
FY 2017- 2018 FY 2016- 2017
Sales 12685 12779
Other Income 685 543
Profit Before Tax 1651 1570
Profit After Tax 1230 1169
Earnings per Share - Rs 61.49 58.47


Your company achieved a Top line of Rs.12685 Lakhs compared to Rs.12779 Lakhs (net)during the previous year. While On the export front we have achieved an appreciablegrowth of 28% with increase in demand from major countries like China UK RussiaThailand Korea Indonesia Singapore etc. However the domestic business has seen ade-growth because of shrinkage in demand in some of the markets. The major contributoryindustry segments in the domestic business which had their adverse impact on yourcompany's sales are Defense Steel Cutting Tools Engineering Sector.

Your Company continued its efforts on pursuing business in its major verticals namelySuper abrasives and Machines and Components. The current slowdown being consideredtemporary and in keeping with your Company's long-term growth would continue to committhe required investments and resources in identified growth areas.

The Super Abrasives business vertical consisting of Diamond/CBN grinding Wheels invarious bonding systems Rotary Dressers Stationary Dressers Hones and Segmentedproducts witnessed a growth of 4% over the last year mirroring the growth of the keyindustrial segments. This has been possible due to continued focus by your Company on thedevelopment of new products and new applications. Your company successfully launched newproducts such as Glass grinding wheel for Structural Solar and Automotive Glass ResinBond Spiral CBN Wheels for Razor Blade grinding Double Disc Fine grinding Wheels forcertain Ceramic Automotive and Engineering applications. During the year company launchedStandard products under Star Brand.

The Machines and Components business performance was lower than previous year mainlydue to softening of demand on Components from certain Auto Component manufacturers. WhileMachine sales in the export market achieved an impressive growth of 63%. The domesticsector faced brunt of Capex postponement/ Capex freeze resulting in lower machine salesduring the year. However your company continued to develop & launch new models /variants like Twin Spindle Honing Machine (E3500) Straight Wheel Head CylindricalGrinding Machine (Precigrind) and CNC Profile Dressing Machine (PDM 400). These Machineshave been received well by the customers and the company expects to get good business incoming years.

On the Precision Components front your Company has successfully completed and addednew components for both existing and new customers. These components have received thefinal approval for the bulk supplies during the fourth quarter. Your company also focusedon de-risking & enhancing the product basket by adding components for Non-AutoIndustry and Non Ferrous components. These initiatives have started yielding results andis expected to contribute exponentially to the overall precision component business incoming years.


Your company continues to drive Lean Practices in both Manufacturing and Supportfunctions for improving operational efficiency. This initiative has benefitted inaddressing some of the key areas like Productivity & Process improvement Effectiveplanning & Scheduling improving Reliability of Delivery maintaining outsourcingcost controlling cost on Consumables WIP and Raw material inventory.

One of the key focus of your company has also been on Sweating of the assets andthereby ensuring effective utilization reducing dependency on sub-contracting for coreprocesses and working round the clock or 3 Shifts basis for major product group. Yourcompany has taken special initiative to reduce overall cost in value chain by reallocatingcommon machines and facilities of all product cells and doing all precision machininginternally while outsourcing only Non-Precision machining. This also helped in having acontrol on capex spend.


Super Abrasive Tooling Industry and Grinding & Honing Machine Industry performanceis driven by GDP growth with major demand primarily coming from Auto Engineering sectorSteel Glass and Cutting Tools industry. Besides this with the emergence of AerospaceDefence and Infrastructure sector Tooling & Machine Tool Industry is expected tobenefit this industry immensely.

Further The Make in India initiative too is expected to propelrequisite growth in coming years.

Your company continues its focus on product and process innovation for deliveringsuperior performances and sustainable growth. Adoption and deployment of appropriatetechnologies for indigenous Bond development streamlining processes introducingautomation in critical areas and working on industry 4.0 would also be the key focus areasfor the year to address the growth for your Company.

The Company would continue to seize new business opportunities in new growingindustrial segments by addressing New Products for existing & new Markets andgeographies.

Future growth of your company lies in constantly watching and monitoring changes in theexternal environment and customer needs that are emerging. Accordingly your company hasbeen tracking the Mega trends and underlying new opportunities that unfolds. Thecompany accordingly would continue focusing on new products for industry segments such asConstruction Aerospace Defense Infrastructure and allied industries. Your company wouldfully complement these efforts and maximize the benefits by participation in majornational and international exhibitions trade shows including digital initiatives andcollaborations.

The acquisition of Winterthur Technology Group (WTG) by the US multinational 3MCorporation and resultant indirect acquisition of 40% equity shareholding in your Companycontinues to be a matter of contention while not being an issue. The matter has been movedto The National Company Law Tribunal (NCLT) Bangalore and matter remains sub-judice.


Wendt Grinding Technologies Limited Thailand

Your company's 100% owned Thailand subsidiary Wendt Grinding Technologies Limited hasyet again delivered sustained results in line with the plan both in terms of sales andprofitability despite continued industry slowdown falling export and political issuesand all odds. It is a demonstration of its strong resolve and business acumen challengingthe unfavorable conditions.

During the year your subsidiary achieved sales of Thai Baht 946 Lakhs (Rs.1844 Lakhs)12% growth over last year. Profit After Tax of Thai Baht 141 Lakhs (Rs.283 Lakhs) acreditable growth of 32% over last year.

Your subsidiary maintained its dominant position in re-profiling business in Thailandfor glass industry with its 70% share of business where it operates. The subsidiaryduring the year focused on exploring new opportunities in Indonesia market. The focus onenhancing the product basket new customer additions etc. have yielded good results.

Your subsidiary continues to participate in the important Industrial and TradeExhibitions & prospecting for new businesses while strengthening networking withindustry leaders for business promotion and development.

Wendt Middle East FZE Sharjah

Wendt Middle East FZE Sharjah the other wholly owned subsidiary of your company hasclocked an annual sale of AED 23 Lakhs (Rs.412 Lakhs) which is 8% lower than the previousyear. The lower topline is attributable to the continuing oil crisis politicaldisturbance and a slowdown in new projects in the region. Also due to the worseningcredit situation in the Middle East the subsidiary has been cautious in growing thetopline. Accordingly the Profits have also been lower at AED 0.4 Lakhs (Rs.7 Lakhs).

During the year your subsidiary has embarked on strategic initiatives to consolidateand grow its business with focus on industrial ceramic products and non-standard abrasiveand super abrasive products. The subsidiary's increased focus on these strategicinitiatives with robust receivables management is expected to deliver results in thecoming year.


Available for appropriation (Rs in Lakhs)
Profit After Tax 1230
Add: Other Comprehensive Income 36
Add: Balance brought forward from previous year 4326
Total 5592
Recommended appropriations
Transfer to General Reserve 130
-Interim Rs 10/-per share 200
-Final (Dividend paid for 2016-17 Rs 15/- per share of face value of Rs 10/- each) 300
Dividend Tax
-Interim 41
-Final (for 2016-17) 61
Balance carried forward 4860
Total 5592


Inclusive growth and Sustainable Community development are strong pillars of yourCompany's responsible corporate citizenship. Your Company being a part of the MurugappaGroup has been upholding this tradition by allocating a part of its income for carryingout its social responsibilities.

Your company's Skill Development Program has been a major initiative towards addressingthe social responsibility. The main objective being to provide high quality vocational andtechnical training towards uplifting the lives of young children from underprivilegedcommunity and weaker sections of the society. This training program is designed based onthe coaching methodology defined by Government of India Ministry of Skill Development andEntrepreneurship. This program also includes stipend payment along with free meals andproviding boarding facilities to the enrolled students ensuring that they earn whilethey learn. Not only does this initiative help in imparting formal education but alsohelps them in honing them to become a valuable citizen & while help them in seekinggainful employment upon successful completion of the course.

The company continues to make contributions to the society extending to communities inits vicinity like to local schools orphanages homes for destitute etc. This is based onyour company's firm belief that an organization's true value lies beyond its business andis reflected by the services it extends to the society. Your company also gives importanceto green environment and tree plantation in the nearby communities by holding seminarseducating and distributing and planting free saplings every year.

The company employees are encouraged to participate in activities like blood donationcamps taking classes on computer education in municipality schools bring awareness onroad safety nominating employees with RTO as traffic warden 5S campaigns towards thecleaner environment imparting special education to the school children to name a few.

In accordance with requirements of the Companies Act 2013 your Company has a CSRpolicy incorporating the requirements therein which is also available on Company's websiteat the following link

Your company during the year 2017-18 has spent of Rs 32.36 Lakhs towards the CSRactivities in line with the provisions of the Companies Act 2013.

The Annual Report on CSR activities in the prescribed format is annexed herewith asANNEXURE C.


The Company has voluntarily adopted the Dividend Distribution Policy as approved by theBoard in line with the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and the same is available on Company's website viz.

In line with the policy the Board of Directors has recommended a Final Dividend of Rs15/- per equity share of face value Rs 10/- each (150%) for the year ended 31st March2018. This is in addition to the Interim Dividend of Rs 10/- per equity share of facevalue of Rs 10/- each which was paid on 19th February 2018.

The Final Dividend is subject to approval of members at the 36th Annual GeneralMeeting & will be paid to those shareholders whose names appear on the register ofmembers of the company as on 1st August 2018. If approved the total Dividend for thefinancial year including the interim dividend amounts to Rs 25/- per equity share andwill absorb Rs 602 lakhs including dividend distribution tax of Rs 102 Lakhs.


Your Company proposes to transfer Rs. 130 lakhs to the General Reserve. An amount ofRs. 4941 Lakhs is proposed to be retained in the Statement of Profit & Loss.


During the year the Company has not accepted deposits from the public falling withinthe ambit of Section 73 of the Companies Act 2013 and the rules framed thereunder.


Details of investments covered under section 186 of the Companies Act 2013 are given inthe note no. 6 to the financial statements.


In terms of Section 124 (5) of the Companies Act 2013 an amount of Rs. 3.78 lakhsbeing unclaimed dividend during the year pertaining to the financial year 2009-10 wastransferred to IEPF after sending due reminders to the shareholders.


The Consolidated Financial Statements of the company (incorporating the operations ofthe Company and its two wholly owned overseas subsidiaries) for the financial year2017-18 are prepared in compliance with the applicable provisions of the Companies ActAccounting Standards as prescribed by Regulation 33 of the Securities and Exchange Boardof India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations 2015. TheConsolidated Financial Statements have been prepared based on the audited financialstatements of the company its subsidiaries as approved by their respective Board ofDirectors.

Pursuant to provisions of Section 136 of the Act the Financial Statements of theCompany the Consolidated Financial Statements along with the relevant documents and theAuditors' Report thereon form part of this Annual Report. A statement of summarizedfinancials of all subsidiaries of your company including capital reserves total assetstotal liabilities details of investment turnover etc. pursuant to General Circularissued by MCA forms part of this report. The audited annual accounts and relatedinformation of the subsidiaries is available in our website-

The key financial data for the consolidated operations are as follows: -


(Rs in Lakhs)
FY 2017-2018 FY 2016-2017
Sales 14432 14466
Other Income 492 313
Profit Before Tax 1804 1657
Profit After Tax 1312 1205
Earnings per share-Rs. 65.62 60.26


Your Company manufactures products that embed a high level of precision and accuracy asdemanded by the customers of various industry segments. While the Super Abrasives Productrange consists of Diamond & CBN Grinding Wheels and Special Tools; the Machinesincludes customized range of high precision machines such as CNC Grinding Notch MillingTC Ring Grinding Honing and Accessories fulfilling the requirements of internationalstandards and including CE certifications. Precision Components are manufactured withsignificant degree of precision and very precise close tolerances necessitating them topassing through the stringent quality standards and measurements through the stringentproduction process and control.

To ensure that your company meet this requirement Quality Management standards are putin place such as ISO 9001 and TS 16949. TS 16949 pertains to manufacturing of precisioncomponents. Further in order to comply with the safety norms and requirements of overseascustomers your company has also successfully implemented EN 13236 Standards. Qualitybeing the uncompromised differentiator for your Company the company attempts hard toensure that final product quality is built by deployment and embracing effective qualitycontrol management process robustness quality assurance and discipline at every stage ofmaterial flow.

The Company continues to place higher emphasis on training in latest trends besidesinvestment in high-end equipment machineries & application software and modern tools.


Your company accords high importance towards safety and health of employees and ensuresthat the work environment is conducive for smooth operations. Towards this the topmanagement stays ever committed for maintaining high standards for safety health andenvironment management by being fully compliant to applicable statutory requirements asper OHSAS 18001 and ISO 14001 EMS standards and guideline.

During this year the company has upgraded to new standard on Social accountability SA8000:2014 and adopted a new Standard on product safety EN-13236:2010+A1:2015 for meetingSafety requirements of the European standard of Super Abrasive products. Every year Wendtobserves a Safety Week with sprawling events spread over the week to emphasize onimportance of safety to the employees. This year it was held on 5th March 2018 whichincluded competitions on slogans posters skits and mock drills.

Recognizing that the employees are the most valuable assets of your company and thatthe Safety and Health of each employee is of utmost importance. The company continues toundertake initiatives and pursue programs including Annual health check-up for employeesand their family special medical attention for employees working in special process &sensitive areas. The company conducted special awareness program on use of personalprotection equipment (PPEs) zero discharge of ETP/STP and hazardous waste handling sothat the employees and their family maintain good health and overall wellness.

Your company continues to periodically conduct safety mock drill and various trainingprograms to educate and prepare towards chemical electrical and medical urgencies.


The employees are encouraged to participate in customer audits group competitionsvarious national and international events & competitions. Your Company continues toget accolades and awards from its customers and other prestigious domestic/internationalforums. Some of the awards and recognitions your Company received during the year underreview:

• “Regional Award for Export Excellence”

Conferred with “Star Performer Large Enterprises” for outstandingexport performance during year 2015-16 by Engineering Export and Promotion Council

• Lean Management Practices

Conferred with Silver Award for Lean Management Practices from ABK AOTS

• ?Quality Circle Awards

Your Company's employees continued to exhibit their skills in various Quality Circlecompetitions as below

International Level: Organized by QCFI Philippines

- “Gold” Award in ICQCC for Kaizen- 1 team

National Level: Organized by QCFI Hosur

- “Gold” Award for Kaizen in CCQC - 4 teams

- “Gold Award” for SGA (Small group Activity) in CCQC: 2 teams.

MGTC Volley Ball Tournament

Your company's employees participated in the Group Level Volley

Ball tournament and won the “Winners” Trophy during the year.

MGTC Women Sports Tournament

Your company's women employees participated in the Group level sports competition andwon awards in Carom Chess and Relay competitions. • Cufest 2017 Awards

Your Company's employees participated in Group-level Quality competition“Cufest 2017” (Quality Festival of CUMI) and won awards for 5S PosterInnovation Idea King SGA and Theme Video


In the sections that follow the information required to be given in the ManagementDiscussion and Analysis Report have been provided


The year 2017-18 just ended with positive sentiments resulting in a modest growth amongvarious industry segments. Your company started the year with many bright prospects &many hopes but as we progressed over the year it had many ups and downs resulting in arather moderate growth for most industrial sectors except a few.

Further on the Domestic front the demonetization effect & the roll out of GST bythe Government during the first half of the year resulted in the unpredictability in thedemand & a resultant reduction in order inflow.

During the year your company continued to focus on the new initiatives be it buildingnew machine models pursuing projects in precision components Lean Management newproduct developments research & development and strengthening our export business. Inaddition to this your company worked closely with customers for new opportunitiesincluding import substitutions to maintain its leading position in the domestic market.


If macro-economic stability is kept under control the ongoing reforms are stabilizedand the world economy remains buoyant growth could start recovering towards its mediumterm economic potential of at least 8 percent.

Improvement in Economy will be supported by an increase in global growth in 2018 whichwill further boost India's exports. Remittances are expected to increase owing to therising trend in oil prices. Stable policy rates along with the favorable interest rateregime in the global markets could provide greater certainty to the investment climate.The reform measures undertaken in 2017-18 are expected to strengthen further in 2018-19and will reinforce growth momentum.

However downside risk to higher growth emanate from higher crude oil pricesprotectionist tendencies in some of the countries and possibility of tightening ofmonetary conditions in the developed countries which could lead to lower capital inflowsand financial stress.


The increasing usage of CNC machines and better performance of super abrasives toolsare the main factors that are expected to drive the super abrasives market. The maindrivers for the super abrasives market is the growing trend on the usage of tough to grind& exotic materials super alloys closer tolerances on component which necessitatesthe use of super abrasives in the automobile sector where the demand has increased athigher rate with more usage in grinding wheels cutting tools files dressing toolsgears bearing and so on. These super abrasive materials (diamond CBN) are used forbetter finishing and addressing higher exacting component requirements as they surface inautomotive sector with the increase in demand for Electrical and fuel-efficient vehicles.

As a major supplier of the most comprehensive range of Super abrasive products and TotalGrinding Solution Provider your company enjoys single- source supplier status withmany customers for a wide spectrum of industry. A major contribution to your company's topline in the coming year is expected to come from sector such as Automobile EngineeringCutting Tools Refractory Aerospace Defense Steel Ceramics and Construction.Therefore your company's performance will also be in congruence with the performancelevels of these industry in coming years.

In order to minimize dependency on certain industry segment your company will striveto focus on exploring new opportunities and has added some new products to enhance theproducts basket especially in the precision grinding area. The effect of this endeavor isevident from the fact that your company has developed many new products for the precisionapplication for industries like Automobile Aerospace Defense Glass Bearing PaintRazor Blade Ceramics and Precision components.

Key Financial Summary
(Rs. in Lakhs)
Particulars 2017-18 2016-17 % change
Domestic Sales 8828 9760 (10)
Export Sales 3857 3019 28
Total Sales 12685 12779 (1)
Operating Profit before Finance cost 1243 1209 3
Capital Employed 10908 10243 6



Despite the recent announcement of a slew of reforms policy measures and fiscalconsolidation by the Government the Indian growth is expected to remain modest in thenear term. However the medium and the long-term expectation from the economy is bullish.After suffering from a temporary setback following the de-monetization and GSTimplementation reforms the economy is bouncing back.

As for your company the confidence levels would continue to be positive because of thespread of its business across varied industrial segments and not dependent only on fewindustry segments.

Your company would continue to leverage upon its vast experience and technicalexpertise team deep understanding of customer requirements comprehensive product rangesuperior technology and the resultant competitive edge emerging out of its twocomplementary business verticals namely Super Abrasives and Machine Tools and PrecisionComponent.

With the Make in India initiative liberalization of civil aviation policyAerospace and Defense industry too is likely to grow at high pace. Your company providesstate of art innovative solution to meet the customers Grinding Dressing and Honingrequirements. Developing products and aligning the business with strong signals of Megatrends would be another area of focus going forward.

To address the huge price sensitive market of Standard and mass consumed SuperAbrasives product your company has also started promoting and selling the standardproducts under STAR Brand which it had acquired during the previous year. This is expectedto help your company to acquire the untapped market of the price sensitive range ofproducts.


The Domestic Super Abrasives Tool market is characterized by presence of both organizedas well as unorganized players. At the one end we have many unorganized regionalpropriety-run entities that are smaller in size and operation with limited offering whichaddress customers' requirements in specific region and compromise with lower price andoften unhealthy business practices. On the other end the presence of well-establishedplayers with high brand value across the globe focusing on technology applicationengineering and product development. The investment in R&D activities by major playersto innovate the existing products and to develop new technologies to sustain competitionin the market is very high.

This has been a unique challenge for your company. To address this your companycontinues to adopt its distinctive method of offering low cost mass products for the lowend. Enhancing standard range of products under Star Brand is one of the initiative tocater to the mass market and for the high-end segment company focuses on itstechnological solutions application engineering and product development by offeringimport substitutes and value additions. For addressing the high performance qualityconscious segment your company is working with foreign Research Institutes and is onlookout for product specific niche manufacturers for acquiring state of the arttechnology.


The Central Statistics Office has estimated the GDP growth in 2017-18 to be 6.5 percent. However the growth during 2018-19 could be higher depending on several factors.Taking advantage of the emerging opportunities your company is fully geared up to retainits leadership position by offering its comprehensive range of products increased marketreach & penetration and adding new products in baskets.

In the Superabrasive Business your company continues to focus on building capability /capacity in identified products cells including enhancing self-sufficiency. Development ofnew products Research and Development will continue be our focus in the coming year. Yourcompany have enhanced the existing product basket by adding more standard products to beoffered under STAR Brand through the distribution channel which is expected to makesignificant contribution to the overall growth of your company.

On Machines and Precision components your company will continue to work towardsstrengthening our Machine Tool business by consolidating various machine models / range toincrease the customer / industry base and overall offering.

The precision Component business is being strengthened and enhanced by adding newcomponents and new customers. The initial test and approval for new projects have beenencouraging and we expect to benefit from this during coming year.

Your Company's 100% owned Subsidiary Wendt Grinding Technologies Ltd Thailandcontinues to show creditable performance year on year albeit Thailand being affected byslowdown specially in export depended countries political disturbances falling demandshifting of base by many Japanese companies. It demonstrates enough confidence for evenbetter performance in the coming year. Certainly this has been possible due to continuousefforts in exploring newer opportunities scanning new industry segments enhancingproduct basket as well as delivering superior value propositions to the customers

in Thailand and adjoining countries.

Your second subsidiary Wendt Middle East FZE Sharjah has been consistent inits performance over the last few years. For the last two years the business environmentin the region has been very challenging in items of political issues war down slide inoil price stalled projects and very few new investments and project expansions. Despitethese difficulties and hardships your subsidiary continues to put all its efforts oncertain markets and industries that have given good results during these tough times. Yoursubsidiary would continue to operate as the Product Availability Point (PAP) for theentire GCC region with focus on General Engineering Aerospace Steel Ceramics Autocomponent & associated industry segments and holds enough promise for betterperformance in the coming year.

Particulars 2017-18 2016-17 2015-16 2014-15 2013-14
Generation of Gross Value added 5272 4902 4417 4373 3868
Breakup on Application of Value added
Payment to Employees 2588 2363 2077 1812 1768
Payment to Shareholders (on payment basis) 500 500 500 500 500
Payment to Government 692 490 539 270 431
Payment to Directors 16 5 5 5 2
Towards replacement and expansion 1476 1544 1296 1787 1167
Total 5272 4902 4417 4373 3868

• Gross Value Added is Revenue less Expenditure (excluding depreciationexpenditure on employee & directors service)

• Payment to Government is Current tax + Dividend distribution tax

• Replacement and expansion is Retained earnings + Depreciation + Deferred tax

Payment to Employees grew at a CAGR of 10% over the last 5 years. Payment to Governmentgrew at 13% CAGR over the similar period. The Company had been constantly investingtowards replacement and expansion expenditure at a CAGR of 6% to ensure fulfilment ofmarket demand.


Your Company has a robust risk management process to identify evaluate and mitigaterisks impacting business including those which may threaten the existence of the company.This framework seeks to create transparency minimize adverse impact on the businessobjectives and enhance the company's competitive advantage. This framework also definesthe risk management approach across the enterprise across various levels includingdocumentation and reporting. The framework has different risk models which help inidentifying risk trends exposure and potential impact analysis at a company level as alsoseparately for the business segments. Risk Managementforms an integral part of theCompany's Business Plan.

The Senior Management of your Company analyze the potential areas of risks and on thecurrent business portfolio and decide which business should receive more focus where toinvest what needs to be added or discontinued from the product portfolio etc. to mitigatethe risks.

The Risk management process for your Company encompasses the following sequence:

• Identify recognize and describe risks that might affect project or its outcomes

• Understanding nature of risk and its potential to affect project goal andobjectives.

• Evaluate or rank the risk by determining the risk magnitude.

• Development of risk mitigation plans.

• Periodic monitoring and review of risk mitigation plans

These are routinely tested and certified by the Statutory as well as Internal Auditors.Significant audit observations and follow up actions thereon are reported to the AuditCommittee.

Risk Factors Related to the Markets/Industry We Serve

Why is it considered as a Risk?

• We could be adversely impacted by our significant exposure to selected fewsectors like auto and auto ancillaries

• We could be adversely impacted by the loss of any of our significant customerschanges in their requirements for our products or change in ownership

• Failure to sustain a continuing economic recovery could have a substantialadverse effect on our business

• We could be adversely impacted by new laws regulations or policies ofgovernmental organizations

• Rebranding of products and the resultant delay in brand establishment

• Disruptive innovation & process changes

Mitigation Plan / Counter Measure to address

• Widening the customer base / new industry segment & new geographies therebyDe-risking the business

• Identify alternate Industrial Focus segment like Aerospace Bearing RazorBlade Glass etc. based on Mega Trends.

• Aligning strategy towards delighting most significant customers both in domesticand as well as overseas market.

• Leveraging relationship and Engagement with the customer - e.g. WOW initiative /Exhibitions like IMTEX participation in international exhibitions like GRINDTEC GermanyMAC United Kingdom IMTS USA CIMT - China CRM & Knowledge Managementapplication

• Setting up of In-house DSIR approved R&D centre. Also thrust on innovationwith focus on New Product Development is now well embraced at Wendt to yield long termresults.

• Branding promoting and selling Standard range of products under STAR Brand.

Competition Risk

Why is it considered as a Risk?

• Direct Imports through OEM route

• Cheaper Imports from countries like China and Taiwan.

• Presence of many unorganized regional players often adopting Low pricingstrategy free samples higher credit days etc.

• New Organized Players entry by setting up manufacturing base in India consequentto Make in India Drive.

Mitigation Plan / Counter Measure to address

• Offer sustained competitive advantage to customer ` through operationalefficiencies

• Focus on Lean & Address QCD Superior Quality Cost competitiveproducts & Reliable Faster Delivery

• Internal Efficiency Measures/ process automation/ Reduce throughput time

• Creating entry barriers for competition / exit barriers for customers - keyaccount management

• Increased focus on New product development

• Enhancing value added services

• Increasing the product basket & offerings

• Building agile Supply chain by capitalizing on CUMI dealer network

• Explore E-Commerce and online sales

• Automation and Robotization to address Lower manufacturing cost and enhanceCompetitiveness

Technology Risk

Why is it considered as a Risk?

• The rapid changes taking place in the fields of grinding / honing technology andmaterial science.

• Access to New Alternate technology following the expiry & Non- renewal oftechnical collaboration agreement with Wendt GmbH post Sept 2012.

• Adoption of Disruptive technologies like 3D printing.

• Technology gap in certain products range as a result of product upgradation byglobal competitors.

Mitigation Plan / Counter Measure to address

• Indigenous development of Bonds with external consultant support and workingwith Research Institutes.

• Collaboration with external consultants

• Established DSIR approved R&D center and build on self-sufficiency intechnology

• Association with external Research laboratories / Technical institutes fortechnology upgradation.

• Working on Product and Process Innovations

HR & Legal Risk

Why is it considered as a Risk?

• Attrition of skilled / trained manpower leading to disruption of operations orknowledge gap

• Contractual liability e.g. Product liability

Mitigation Plan / Mitigation Plan / Counter Measure to address

• Succession planning

• Career Development

Knowledge Management Portal whereby all major establishedapplications are safely documented for reference and trail

• CCSD (CUMI Centre for Skill Development) providing employable technicians

• Market linked revision in Compensation

• Focus on multi skilling & skill upgradation.

• All contracts cleared by the Legal team

Online Data & Information Security Risk

Why is it considered as a Risk?

• Data breach leading to loss and critical information infrastructure breakdown

Mitigation Plan / Counter Measure to address

• Policy in place for Technical Controls

• Disaster Recovery Strategy & Business Continuity Plan in place.

• Data center access limited to authorized personnel

• Crisis Management Group in Place.


One of the key success factors for your company's sustainability and consistentoperations has been the use of technology and SAP ERP system. During the yearconfiguration has been made within SAP modules to meet GST Compliance thusleveraging on the benefits for smooth functioning and steady flow of information acrossvarious functions. Your company could smoothly implement GST with the modification in SAPin record time.

Your company has implemented SIEM (Security Information and Event Management)for identifying monitoring recording and analyzing security events or incidents in areal-time IT environment and Document Management System for Management Standardswhich supports in retrieval of documents during Audit and provides alert mechanism forlegal / statutory / calibrations / MRM / NC / Compliance along with action plans as pertimelines.


The Company has put in place adequate system of internal controls commensurate with itssize and the nature of its operations. The Company's internal control system covers thefollowing aspects:

• Financial proprietary of business transactions.

• Safeguarding the assets of the Company.

• Compliance with prevalent statues regulations policies and procedures.

The Internal Audit team evaluates the effectiveness and adequacy of internal controlscompliance with operating systems policies and procedures of the Company and recommendsimprovements if any. The Audit Committee of the Board periodically reviews audit plansobservations and recommendations of the internal and external auditors with reference tothe significant risk areas and adequacy of internal controls and keeps the Board ofDirectors informed of its observations if any from time to time.

During the year there were no changes in internal control over financial reportingthat have materially affected or are likely to have any financial reporting lapse.

Internal Financial Controls

As per Section 134 of the Companies Act'2013 the term 'Internal Financial Control'(IFC) means the policies and theprocedures adopted by the Company for ensuring:

a) Orderly and efficient conduct of its business including adherence to accountingpolicies b) Safeguarding of its assets c) Prevention and detection of frauds and errorsd) Accuracy and completeness of accounting records and e) Timely preparation of reliablefinancial information.

The key components of IFC followed by the Company are:

1. Entity Level Controls (ELC) that the management relies on to establish appropriate-Code of Conduct Hiring and Retention practices Whistle Blower mechanism Delegation ofAuthority and other policies and procedure.

2. Process Level Controls (PLC) to ensure process are stable predictable andconsistently operating at targeted level of performance classified into Manual orAutomated Controls.

3. General IT Controls to ensure appropriate functioning of IT applications and systemsbuilt by company to enable accurate and timely processing of financial data are -UserAccess rights Management and Logical Access Change Management controls; password policiesand practices Patch management and License management; backup and recovery of data.

The adequacy of IFC is ensured by:

• Documentation of risks and controls associated with major processes.

• Validation of existing Controls to mitigate risks.

• Identification of improvements and upgradation of the controls

• Improving the effectiveness of controls through data analytics

• Performing testing of controls by Independent Internal Audit firm.

• Implementation of sustainable solutions to Audit observations.

FINANCIAL REVIEW Earnings Revenues

During the year your company achieved total sales of Rs.12685 Lakhs similar toprevious year. While the domestic sales were lower by 10% over the last year at Rs.8828Lakhs the export sales were higher by 28% compared to the previous year at Rs.3857 Lakhs.As briefed earlier the major industry segments which contributed to the de-growth of thedomestic business are steel auto ancillaries engineering trading etc. The higher exportwas due to higher sales to 10 focus countries like Russia China Singapore UK ThailandIndonesia Korea etc. during the year.

Profit before Tax

The profit before tax is higher by 5% at Rs.1651 Lakhs compared to Rs.1570 Lakhs in2016-17. The higher profit is because of the improved product and process efficiencymeasures taken by the Company and control over the fixed cost.

Profit after Tax

The profit after tax is higher by 5% at Rs.1230 Lakhs compared to Rs.1169 Lakhs in2016-17.

Liquidity and Cash Equivalents

Your company continues to be debt free company maintaining sufficient cash and cashequivalents to meet its futuristic strategic initiatives. This is achieved by beingprudent in its investment policy over the years maintaining a reasonably high level ofcash and cash equivalents which enable the company to completely eliminate short andmedium-term liquidity risks.

The Company has a robust Cash Management Policy whereby it: a. Conserves sufficientcash as reserves that will aid the company in venturing into meaningful businessopportunities that unfold during the year. b. Use cash to provide sufficient workingcapital to address business objectives of the company & to add value to allstakeholders by continued enhancement. c. Prudently Invest surplus funds that the businessgenerates in debt schemes of mutual funds as per Group norms and prior approval from theBoard. This ensures availability safety and liquidity of Company's funds while allowingreasonable yield as per the prevailing market rates. The surplus funds are generatedthrough stringent control on working capital.

During the year your company's investment in mutual funds increased from Rs.1072 Lakhsto Rs.1799 Lakhs as on 31st March'2018 i.e. a growth of 68%. As the earnings are ploughedback the capital expenditure need of your company for the year was met entirely from themutual funds investment.


Your Company has done judicious cost control whereby the fixed cost excludingdepreciation as percentage of sales has been controlled at 33% similar to last year'slevel.

The variable costs have been controlled during the year through indigenization of rawmaterial and other input costs which has helped in improving the margins of the company.The Lean Management Initiative undertaken by your company has also helped in significantsavings during the year. Your company's price correction initiative from both customersdomestic and exports and key suppliers has improved its profitability in the current year.

Financial Position

Share Capital

The paid-up equity share capital as on March 31 2018 was Rs.200 Lakhs. During the yearunder review the Company has not issued shares with differential voting rights norgranted stock options nor sweat equity.

Share-holders Funds

The shareholders fund as on 31.03.2018 was Rs.10908 Lakhs against Rs.10243 Lakhs ofprevious year an increase of 6%. Accordingly the book value of the share stands atRs.545/- as compared to Rs.512/- during the previous year.

Loan Funds

Your Company continues to utilize its cash credit limit with State Bank of India tobridge the short-term fund requirement and for meeting the temporary mismatches in itscash flow. Your Company does not have any interest- bearing term loan.

During current year too the working capital limits of your Company continues to berated by ICRA as AA- (pronounced ICRA double A minus) rating assigned to the Rs.2 croreLong-term Fund facilities of your Company which signifies low credit risk and stable. Theshort-term Rating assigned to the Rs 6 crore Non-Fund Based working capital limit alsocontinued to be reaffirmed as A1+ (pronounced ICRA A one plus). Overall your Company'srating continues to be stable and low credit risk.



Your company continues with the policy of being prudent in its capex spend. During thecurrent year the capital expenditure was Rs.547 Lakhs. The major capex spent was onaddition of new plant & machinery towards capability building in fast growing productsand new products capacity enhancements which are critical for the future growth of thecompany. Company follows the policy of funding all the capex through the internalaccruals.

Inventories and Sundry Debtors

The Company follows rigorous Working Capital Management based on a well-organizedprocess of continuous monitoring and control on Receivables Inventories and otherparameters. The overall inventory levels as on 31st Mar'2018 is Rs. 1876 Lakhs similar tolast year.

Receivables (Gross) as on 31st March'2018 were at Rs. 3421 Lakhs against last year'sfigure of Rs.2902 Lakhs. Despite the tough liquidity position your Company has been ableto maintain the receivable average credit days at 79 days similar to previous year. Thisis possible through aggressive receivable management system including close follow ups andcredit lock through the SAP system to ensure that receivables are kept under control andpayments received in time.

Foreign Exchange Hedging

Your Company being a net exporter continues to follow the policy of natural hedgingof foreign exchange earnings and outflow and hence it does not take any forward covers.The net forex gain during the year has been Rs.115 lakhs (Previous Year Rs.20 Lakhs).

Financial Performance with respect to Operational Performance

Your Company kept its Operating profit and Contribution better than the industryaverage by adopting stringent control measures for improved operational efficiency led bythe LEAN Initiative. This was aided by accurate information & customer datacentralized drawing management system better planning & scheduling through SAP ERPSystem and effective vendor management. Your Company's improved MIS reporting and abilityto respond to customer with real time information helped in giving rich experience to thecustomers there by providing value addition to the customer.


As in the past your company continued its adequate care in providing requiredinsurance cover for company's assets - buildings plant and machinery includinginventories and for liabilities under legislative enactments. Besides adequate GroupPersonnel Accident (GPA) Group Mediclaim (GMC) insurance coverage is taken for theemployees and their dependents to cover the risk arising out of accidents or sickness.


The human capital is the most precious asset in any organization. Your Company isdetermined to accelerate its growth story by consistently changing the needs of diverseworkgroup by fostering an engaging work environment to constantly build the uniquecapabilities and skills of the people. The company has a strong and diverse workforcewhere every employee is involved as “partners” in the progress. The intangibleasset comprises all the competencies of the people within the organization in terms ofeducation experience potential and capacity. For High Potential Individuals companyencourages them to undergo mentoring and personality development programs to prepare themfor leadership roles and bigger business challenges in future.

The Company is proud to deliver value to its customers investors and society at large.The unmatched employee commitment and ownership that employees have towards theorganization has translated in growth of the company over the years.

Talent recruitment and retention is something that Wendt focuses on. Proper and step bystep induction is given to all new employees to familiarize them with the group norms. Thecompany's GET batch of 2017-18 were part of a blended learning initiative called YOLO(You Only Learn Once) to manage their transition into a workplace in a systematic andeffective manner.

The company encourages the employees to enhance their knowledge skills &competencies in respective field by way of their pursuing higher education whilecontinuing his job. Your company sponsors such of the befitting employees by partiallysharing the course / education fee. This helps the employee to enhance his knowledge andskill to address his growth and the required changing job competency.

Your Company also lays emphasis on developing its existing manpower through trainingand development programs carried out at regular intervals. Skill management is stressedupon and is an ongoing process at all levels. The organization takes interest in nurturingtalent through mentorship & process specific trainings & modules. For developmentof Supervisor company has taken initiative - “Unnatham” and “SuperAppu” for Personality Development and Team Building. The organization ensuresall-round development of an individual through regular synergy activities along withfestival celebrations which are organized at regular intervals. This helps in engaging theemployees and provides them a level playing field to interact with fellow colleagues andtheir families.

Your company focuses on Business Excellence and continual improvement journey (TQM) inits quest to improve the quality of products processes and systems. All this requiresongoing learning job enrichment aligning rewards and recognition with performance highengagement levels conducive work environment and a cordial industrial relationship.

Employee relations continue to be smooth and cordial and the work atmosphere remainedcongenial throughout the year. The manpower strength of confirmed employees of yourcompany as on 31st March 2018 was 399.


All related party Transactions that were entered during the financial year were onarm's length basis and were in the ordinary course of business. During the year therewere no materially significant related party transactions made by the Company withPromoters Directors key Managerial Personnel or other designated persons which may havea potential conflict with the interest of the Company at large.

In line with the provisions of Section 177 of the Companies Act 2013 read with theCompanies (Meetings of the Board and its Powers) Rules 2014 prior omnibus approval forthe estimated value of transactions with the related parties for the financial year isobtained from the Audit Committee. The transactions with the related parties are routineand repetitive in nature. The summary statement of transactions entered into with therelated parties pursuant to the omnibus approval so granted are reviewed and approved bythe Audit Committee and the Board of Directors on a quarterly basis.

The Policy on Related Party Transactions as approved by the Board is uploaded on theCompany's website.

None of the Directors has any pecuniary relationships or transactions vis-a-vis theCompany.



The Board of Directors have appointed Mr. M Lakshminarayan as an Additional Director onthe Board of the Company with effect from 20th March 2018 and he holds office till thedate of the ensuing Annual General meeting. The Company is proposing to appoint him as anIndependent Director under section 149 of the Companies Act 2013 for a term of 5 years.Mr. Lakshminarayan has offered himself for this appointment. The Company has received anotice from a shareholder proposing his candidature as Director in the ensuing AnnualGeneral Meeting.

In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. K Srinivasan Director retires by rotation at theforthcoming Annual General Meeting and being eligible offers himself for re-appointment.The necessary Resolution is being placed before the shareholders for approval. The Boardof Directors of your company believes that his continued association with the Board willbe beneficial to the company and recommends his re-election.

All the Directors of the company have confirmed that they are not disqualified frombeing appointed as directors in terms of Section 164 of the Companies Act 2013. All theindependent Directors have given a declaration under section 149(6) of the Companies Act2013 confirming their independence.


Mr. Rajesh Khanna Chief Executive Mr. Mukesh Kumar Hamirwasia Chief FinancialOfficer and Ms. Akanksha Bijawat Company Secretary continue to be the Key ManagerialPersonnel of the Company as per Section 203 of the Companies Act 2013 and there were nochanges during the year.


A calendar of Board Meetings is prepared and circulated in advance to the Directors.

During the year five Board Meetings were convened and held in accordance with theprovisions of the Act. The date(s) of the Board Meeting attendance by the directors aregiven in the Corporate Governance Report forming an integral part of this report.


In compliance with the provisions of Sections 135 177 178 of the Companies Act 2013the Board constituted Corporate Social Responsibility Committee Audit CommitteeNomination and Remuneration Committee and Stakeholder Relationship Committee (Committees).The details of composition of the Committees their meeting and attendance of the membersare given in the Corporate Governance Report forming an integral part of this report.


Pursuant to the provision of the Companies Act 2013 and Regulation 17 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Board had carried out anannual evaluation of its own performance the Directors individually and the Committees ofthe Board. Structured assessment forms which were duly reviewed were used in the overallBoard evaluation process comprising various aspects.

The manner in which evaluation has been carried out has been explained in the CorporateGovernance Report.


The Board has framed a policy for selection and appointment of Directors SeniorManagement and their remuneration. The Remuneration policy is stated in the CorporateGovernance Report.


The information required pursuant to Section 197(12) of the Act read with Rule 5 of TheCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended bythe Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules 2016and forming part of Directors report for the year ended 31st March 2018 is annexed inAnnexure D.


Pursuant to the provisions of Section 139 of the Companies Act 2013 and the rulesframed thereafter M/s Price Waterhouse Chartered Accountants LLP were appointed asStatutory Auditors for a term of 5 consecutive years at the 35th Annual General Meeting ofthe Company held on July 24 2017 subject to ratification of their appointment at everyAGM.

M/s Price Waterhouse Chartered Accountants LLP have furnished a certificate of theireligibility as per Section 141 of the Companies Act 2013.

The Report given by M/s Price Waterhouse Chartered Accountants LLP on the FinancialStatements of the Company for the year ended 31st March 2018 is provided in the financialsection of the Annual Report. There are no qualifications reservations adverse remarksor disclaimers given by the Auditors in their report. The notes on the accounts referredto in the Auditors' Report are self- explanatory and do not call for any further comments.


Pursuant to the provisions of Section 204 of the Act and the Rules framed thereunderthe Company has appointed Ms. Apeksha Nagori Practicing Company Secretary to undertakethe secretarial audit for the financial year 2017-18. The Report of the SecretarialAuditor confirming compliance with the applicable provisions of the Companies Act 2013 andother rules and regulations issued by SEBI/other regulatory authorities forms part of theAnnual Report.

The Company also adheres to the various Secretarial Standards issued by the Instituteof Companies Secretaries of India.


Your Company has inculcated strong culture of values ethics and integrity living withthe Five Lights- The Spirit of Murugappa Group. The Governance Philosophy of yourCompany is firmed up on a bedrock of ethical values and professionalism which in more than3 decades of the Company's existence has become a part of its culture. Wendt (India)Limited looks upon good Corporate Governance practices as a key driver of sustainablecorporate growth and long-term stakeholder value creation.

The Company practices and policies reflect true spirit of Corporate Governanceinitiatives.

In terms of Regulation 34(3) read with Schedule V of the Listing Regulations aseparate section on Corporate Governance including the certificate from a PracticingCompany Secretary confirming compliance is annexed to and forms an integral part of thisReport.


The Chief Executive and the Chief Financial Officer have submitted a certificate to theBoard on the integrity of the financial statements and other matters as required underRegulation 17(8) of the Listing Regulations.


The Company has a well-established whistle blower policy as part of vigil mechanism forDirectors and employees to report concerns about unethical behavior actual or suspectedfraud or violation of the Company's Code of conduct or ethics policy. This mechanism alsoprovides for adequate safeguards against victimization of Director(s)/employee(s) whoavail of the mechanism and also provides for direct access to the Chairman of the AuditCommittee in exceptional cases.


The extract of the Annual Return in form MGT 9 as required under Section 92(3) of theAct and the Rules framed thereafter is annexed to and forms part of this report. (FORMATIN ANNEXURE B).


Pursuant to the provisions of Section 134(3) (c) of the Companies Act 2013 the Boardof Directors of your Company make the following statements to the best of theirknowledge and belief and according to the information furnished and explanations obtainedby them:

• That in the preparation of the annual financial statements for the year ended31st March 2018 the applicable accounting standards have been followed and there havebeen no material departures therefrom.

• That they have selected appropriate accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at the end ofaccounting year and of the profits of the Company for the year ended 31st March 2018.

• That proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities.

• That the annual financial statements have been prepared on a going concernbasis.

• That proper internal financial controls have been laid down to be followed bythe company and that such internal financial controls are adequate and were operatingeffectively.

• That proper systems have been devised to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


The information on energy conservation technology absorption expenditure incurred onResearch & Development and forex earnings/outgo as required under Section 134(3)(m) ofthe Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 isannexed to and forms part of this Report (refer Annexure A).


Your Board of Directors would like to place on record their sincere appreciation forthe cooperation received from various stakeholders of the Company viz. customerssuppliers bankers investors government and other statutory authorities auditorsbusiness associates and shareholders. Your Directors extend their gratitude to all theregulatory agencies like SEBI Registrar of Companies stock exchanges and other Centraland state Government authorities/agencies vendors and sub-contracting partners for theirsupport. The Board also acknowledges the unstinted co-operation commitment and dedicationmade by all the employees of the Company.

The Directors also wish to place on record their gratitude to the members of theCompany for their unrelenting support & confidence.

By order of the Board
For Wendt (India) Limited
Place: Bengaluru M M Murugappan
Date: 25th April 2018 Chairman

Annexure to the Directors Report

A) Information under section 134(3)(m) of the Companies Act2013 read with Rules 8(3)of The Companies

(Accounts) Rules 2014 and forming part of Director's Report.

a) Conservation of Energy

Your company pursued energy conservation efforts relentlessly during the year althoughcompany does not fall under the category of power intensive industries. The organizationis an ISO 14001 certified company which is an International Management System Standard.The environmental policy of your Company focuses on conservation of natural resources andminimization of pollution. The following energy conservation measures were considered byyour Company during the year:

• Installation of LED and Induction Lights replacing the conventional high energyconsumption lightening.

• Introduction of LDR (Light Dependent Resistance) for switch OFF the loadsbased on daylight's intensity by employing a light sensor.

• Introduction of Natural Turbo Ventilation which reckoned as a perfect andnatural air exhausting options for your industries.

• Installing Solar Heater in Canteen Area to wash vessels and Utensils.

• Installation of APFC (Automatic Power Factor Controllers) to improve/stabilizePower factor.

• Installation of occupancy sensors in washrooms & lavatories.

• Optimum utilization of energy through process redesigning as well as maximumutilization of equipment that offers improved energy efficiency.

• Time switches installed at various places for automatic control of streetlights.

• Your company has taken measures to save water whereby 100% of the domesticeffluent and the trade effluent are treated and used for gardening and electroplatingprocesses (Zero discharge).

b) Technology Absorption Adaptation and Innovation

Your company is pioneer in the field of Super Abrasives Machines and PrecisionComponents in India and quickly adopts latest technologies in its applications to sustainthe front line for the business development. Few years back the techno-commercialagreement between Wendt GmbH and Wendt India Ltd had come to an end and the R&D hadput in efforts and indigenized the bonding systems suitable for different verticals inSuper abrasives.

Today R&D has taken initiatives to develop our own technologies and patent novelconcepts/designs to become the front-line runners in the Super-abrasives technology. Ithas established collaborations with the world-renowned Universities and researchInstitutes to gain more insights into the abrasive products and corroboratively developingnew products in India to the world standards. Consequently your company developedcustomized products and extended its boundaries in Aerospace Automotive RefractoriesConstruction Cutting Tools and Textile & Paper industries.

Your Company has also recognized and started some more areas for bond development forindustries such as Rotary

Tools CAM/Crank shaft and Flat glass with the help of a well-qualified and experiencedexternal consultants.

As you are aware that your Company also work closely with the other R&Ds units oftheir Indian Joint venture partner Carborundum Universal who are the pioneers in thefield on conventional abrasive & material science for some of the application growthsfor specific areas. One of the primary objective of your Company is to work on costeffective alternate raw materials to improve operational efficiency thereby reducingcosts and waste elimination. Based on your company's requirements for modern technologyand growth prospect strategic acquisitions/collaborations in related areas are beingexplored.


With the advancement of science and technologies at a greater extent in automobileaerospace and in electronic sectors the need of manufacturing solutions with moderntechnologies are vital to sustain in the current market. In such industries Research& Development plays a crucial role for innovation and development of new competitivetechnology to maintain the pace with the rapid changing needs of the Market. At yourcompany the Research & Development involved in the advancement of Materials Science& Machining Techniques towards providing the “Complete GrindingSolutions” to its Customers & related Market accordingly. Your Company'sin-house R&D Centre is certified by DSIR under the Ministry of Department of Scienceand Technology Government of India valid up to 31st March'18 which has been renewed foranother two years till March 31 2020.

Your R & D venture continues to carry out indigenous Bond development in a majorway and to help the organization to be ahead of competition with launch of newer products.Being DSIR approved your company gets a new recognition amongst the peers and thecustomers. It ensures that the products developed in-house are up to the standards. YourCompany's R&D is equipped with advanced testing equipment and qualified competentemployees to carry out requisite product research on Super abrasives. The focus is todevelop new products to the Indian market to facilitate import substitutions along withincreased share of export market. One of the major achievements of R&D is theself-indigenization of the bonding material for super abrasive products. In thefast-growing technologies moving targets are the big challenges for sustainability; yourCompany's R&D team has been putting a lot of effort to develop new products withsuperior performance. Projects such as glass grinding Camshaft/Crankshaft grinding anddouble disc fine grinding requires high competency and efforts to develop &standardize against benchmark products.

The DSIR recognized R&D also provides opportunities to form consortiums withresearch laboratories in India and abroad to develop next generation smart grindingsolutions. Few projects have already been initiated to accomplish nano-finishing withCMMRF (Chemical Mechanical Magneto Rheological Finishing) fluids with BARC-Mumbainano-machining using single crystal diamonds light weight grinding wheels for high speedgrinding applications self-dressing & self-lubricating grinding wheels and Modelling& Simulation of different grinding applications to understand their underlyingmechanisms and to gain insights into the working conditions required for effectivegrinding solutions.

Your company's R&D is equipped with state-of-the-art research facilities for thedevelopment of Technology/Product/Process/Validation and is very well supported by ahighly qualified experienced and dedicated team. Being fully equipped company's R&Dhas taken initiatives to work on most expedient objectives of the company with a view toadd key features to the grinding & finishing applications by the advancement of thenew/existing products with technology up-gradation. Research on cost-effective grits andalternative raw materials are carried out in-house with a view to offer a better valueproposition to its customers.

Apart from product development your company is also addressing processimprovement/process development such as hot pressing induction heating vacuum brazingand electroplating & electroless plating process. These processes substantiallyimproved the quality of the products being manufactured in an economical way and offershigh productivity without sacrificing the quality of products.

Your company's R&D is more focused on filing patents and publishes papers in thepeer reviewed SCI journals. They are having their network around the world attendingnational & international conferences and continuously developing & upgradingskills by undertaking essential training and workshops.

Projects completed in R&D: -

• Create state-of-the-art testing and R&D infrastructure for internalvalidation.

• Development and manufacture of high performance vitrified Diamond grindingwheels for Bruiting applications.

• Indigenization of Resin Bond for CBN/ Diamond Wheel.

• Development of indigenized Polyamide Bonds.

• Development and manufacture of various types of vitrified CBN general purposecylindrical grinding wheels for grinding steel rolls/ pipes of 55 HRC and above.

• Development of vitrified superfinishing honing sticks.

• Development and manufacture of Dicing and slicing blades.

• Development of Bonding material for Resin bonded wheel.

Following projects are under progress in R&D: -

• Development of Vitrified bond for Crankshaft and Camshaft applications.

• Development of glass grinding wheels for Auto Solar and Structuralapplications.

• Development of CFRP super abrasive wheels for high speed grinding applications.

• Development of Carbide Insert grinding wheels

• Developing nanometric surface finishing of optical lenses electro ceramics andbio-implants using Chemo-Mechanical Magneto-Rheological Finishing (CMMRF).

• Development of Electroplated wheels to enhance the life by using secondarygrits.

• Development of super abrasive (SA) grits / modified SA grits.

• Development of Double disc fine grinding wheel for the thickness grinding ofsintered ceramic & metal parts.

• Development of Bonds for Razor blade grinding.

• Development of Hybrid bonding system for Fluting applications.

Benefits derived as a result of the above R & D

Business organization gain considerable benefit through investing in research anddevelopment. Furthermore

ongoing research in your company's R&D brings new opportunities in the market.

Following are the benefits accruing out of R&D activities:

• Development of bonds & self sufficiency

• Indigenization of Bonding Materials for super abrasives as an import Substitute.

• Grinding Solutions for New application

• Upgrading Manufacturing Technologies with current Needs

• Development of Futuristic products in Super abrasives

• Development of new body materials for our products machine parts &components

• Since the company's R&D facility has got the recognition and approval fromDSIR your company gets tax benefit on the R&D capital & revenue expenditure.

Your Company's continued investment in research and development has resulted indevelopment of some of the

new products with special features for the grinding and finishing applications in theprevious year.

Some of the new products and processes developed by your company last year are

• Double disc fine grinding wheels for thickness grinding of ceramics and sinteredmetal parts

• Vitrified bonded CBN ID grinding wheels for fuel injection nozzle bore and seatface grinding applications.

• Glass grinding wheels for Structural and Solar applications.

• CFRP grinding wheels for high speed grinding applications.

• Development of metal bonded wheels using hot pressing system.

• Firing of Alumina dressing sticks using Microwave system.

• Adopted bi-axial pressing of vitrified segments.

Benefits derived: Your Company mainly caters to niche market where majority ofcustomers are OEMs and look for technologically superior products with consistentperformance. With majority of the customers considering your Company as a One-Stop Shopfor Complete Grinding and Honing Solutions offering technologically superior productswith reliable performance. Your company can address the ever-changing needs &expectations of the customers by virtue of its strong focus on R&D and focus oncustomer centricity. This facilitates your Company to retain its dominant position in themarket and also enable to justify the due premium for its product reflecting on yourcompany's profitability.

(i) Expenditure on R&D (Rs. In Lakhs)
Sl. No Particulars 2017-18 2016-17
a) Capital Expenditure 64 42
b) Recurring (revenue expenditure) 163 202
c) Total Expenditure 227 243
d) Total R&D Expenditure as a percentage of turnover 1.79% 1.90%
(net of excise duty)
(ii) Foreign Exchange Earnings and Outgo (Rs. In Lakhs)
Sl. No Particulars 2017-18 2016-17
a) Foreign Exchange Used 2804 3025
b) Foreign Exchange Earned 4061 3321


By order of the Board
For Wendt (India) Limited
Place: Bengaluru M M Murugappan
Date: 25th April 2018 Chairman



A. The details of top ten employees in terms of remuneration drawn during the financialyear 2017-18 as per Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 duly amended by the Companies (Appointment and Remuneration ofManagerial Personnel) Amendment Rules 2016 are as follows:

Sl. No. Name and Age Designation/ Nature of duties Gross remunerati on paid (Rs in Lakhs) Qualification & experience (years) Date of commencement of employment Previous employment
1 Rajesh Khanna (57) Chief Executive Officer 125.61 B.E (Mech) PGDBA (35 years) 01-10-1982 NIL
2 M S Venkatesh (52) Unit Head 52.28. B.E. (28 years) 25-03-1996 Mysore Kirloskar Ltd.
3 S Sundariya (53) Business Head- Machine & Precision Components 37.21 IIIE (35 years) 03-08-1992 Rane Brake Lining Limited
4 Mukesh Kumar Hamirwasia (46) Chief Financial Officer 35.80 B.COM (Hons) ACA AICWA (20 years) 15-04-2010 Ecom Gill Coffee Trading Pvt. Ltd.
5 D K Hotta (54) Business Head- Super Abrasives 29.45 B.E. PGDBA (27 years) 16-09-2002 ICFAI Business School
6 Santosh Kulkarni P (47) Marketing Head -SA - Domestic & Exports 24.35 B.E. (25 years) 02-05-1997 Ultra Filter Pvt. Ltd.
7 Uday R B (48) Senior General Manager - SA Manufacturing 24.05 B.E. (26 years) 08-01-2005 Sundram Fasteners
8 Satish Kumar S (50) General Manager - Machine Tools 21.90 B.E. (Mech) (26 years) 06-10-1995 Gedee Weiler Pvt. Ltd.
9 Prasanna Kumar H K (56) General Manager - TQM Lean & Management Standards 21.71 DME (33 years) 09-09-1985 WIDIA
10 Ponnuvel C (57) General Manager - Precision Components 21.51 DME (33 years) 10-12-1984 Usha Telehoist Ltd.

a) None of the employees of the Company other than the Chief Executive were in receiptof remuneration for the FY 2017-18 in excess of Rupees One crore and two lakh rupees peryear or eight lakhs and fifty thousand rupees per month.

B. The details of remuneration during the year 2017-18 as per Rule 5(1) of theCompanies (Appointment & Remuneration of Managerial Personnel) Rules 2014 as amendedby the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules2016 as are as follows:

(i) the ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year. N.A. The directors are paid only sitting fees and a fixed sum as commission* for attending Board and Committee Meetings. * subject to the shareholders' approval at the 36th AGM of the Company.
(ii) the percentage increase in remuneration of each director Chief Financial Officer Chief Executive Officer Company Secretary if any in the financial year. Director: N.A.
CEO: 7.90%
CFO: 8%
CS: 8%
(iii) the percentage increase in the median remuneration of employees in the financial year. 8.47%
(iv) the number of permanent employees on the rolls of company. 399
(v) (a) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year: N.A. The directors are paid sitting fees and a fixed sum as commission for attending Board and Committee Meetings.
(b) Percentile increase in the managerial remuneration: N.A.
(c) Comparison of the above and justification thereof: N.A.
(d) Point out if there are any exceptional circumstances for increase in the managerial remuneration: None
(vi) affirmation that the remuneration is as per the remuneration policy of the company. The Company is in compliance with its Remuneration Policy.