Mar 31, 2023
Your Directors are pleased to present the 29th Annual Report on the business and operation of the Company together with Audited Statement of Accounts for the financial year ended March 31, 2023.
The Company''s financial performance for the year ended March, 2023 is summarized below:
( '' in Crores |
||||
PARTICULARS |
Standalone |
Consolidated |
||
FY 2022-23 |
FY 2021-22 |
FY 2022-23 |
FY 2021-22 |
|
Revenue from operations |
2157.99 |
1630.34 |
2159.68 |
1629.58 |
Other Income |
22.24 |
10.79 |
41.11 |
10.78 |
Total Income |
2180.23 |
1641.13 |
2200.79 |
1640.36 |
Earnings Before Depreciation, Finance costs, Exceptional items and Tax |
247.06 |
163.11 |
262.03 |
162.23 |
Less: Depreciation and amortization expenses |
17.66 |
15.28 |
18.00 |
15.41 |
Less: Finance Costs |
10.24 |
9.49 |
10.29 |
9.52 |
Profit before exceptional items and Tax |
219.16 |
138.34 |
233.74 |
137.30 |
Less: Exceptional items |
- |
- |
- |
- |
Profit Before Tax |
219.16 |
138.34 |
233.74 |
137.30 |
Less: Tax expense (Net) |
57.96 |
32.43 |
60.76 |
32.30 |
Profit After Tax |
161.20 |
105.91 |
172.98 |
105.00 |
Other Comprehensive income for the year (net of tax) |
0.03 |
-0.35 |
0.02 |
-0.27 |
Total Comprehensive income for the year |
161.23 |
105.56 |
173.00 |
104.73 |
FINANCIAL PERFORMANCE OVERVIEW (STANDALONE BASIS)/ STATE OF COMPANY''S AFFAIRS
The brief highlights of the Company''s performance (standalone) during the financial year 2022-23:
⢠Total revenue from operations increased to ''2157.99 crores as against ''1630.34 crores in the previous year - an increase of 32.36%.
⢠Earnings before Interest, Depreciation, Amortization, Exceptional Items & Tax for the current year is ''247.06 crores against ''163.11 crores in the previous year - an increase of 51.47%.
⢠Profit before Tax (PBT) and Profit after Tax (PAT) for the current year are ''219.16 crores and ''161.20 crores respectively against ''138.34 crores and '' 105.91 crores in the previous year - an increase of 58.42% and 52.20% respectively.
⢠Earnings per share is ''13.54 for the year under review. CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of the business of the Company during the financial year ended March 31, 2023.
AMOUNTS Transferred TO Reserves
During the year under review, no amount was transferred to any of the reserves by the Company.
The Board of Directors at their meeting held on May 30, 2023, has recommended payment of ''1.00 i.e. (50%) per equity share of the face value of ''2 (Rupee Two Only) each as final dividend for the financial year ended March 31, 2023. The payment of final dividend is subject to the approval of the shareholders at the
ensuing Annual General Meeting (AGM) of the Company.
The dividend distribution policy is available on our website at: https://www.ace-cranes.com/home/investor-policies-and-programme-codes.
SHARE CApITAL
During the FY 2022-23, there is no change in the share capital of the Company and the Company has not issued any:
(a) Shares with differential rights;
(b) Sweat equity shares;
(c) Bonus shares;
(d) Debenture, bond and any other securities. employee stock option SCHEME (ESOS)
The ''Action Construction Equipment Limited Employee Stock Option Scheme 2021 ("Scheme") is in line with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SBEB Regulations") and there were no material changes to the scheme during the financial year 2022-23.
The Scheme is being implemented in accordance with the SBEB Regulations and the resolution(s) passed by the members. The Secretarial Auditors Certificate would be available during the Annual General Meeting for inspection by the members. The details as required to be disclosed under the Act and/ or SBEB Regulations would be available on the Company''s website at www.ace-cranes.com.
UTILIZATION OF FUNDS RAISED THROUGH Qip
The reporting of the utilisation of funds, as on March 31, 2023, raised through the Qualified Institutional Placements (QIP) are as follows:
s. N. |
Original Object |
Modified Object, if any |
Origi nal Alloca tion |
Modified Allocation, if any |
funds Uti lised |
Amount of Deviation /Variation |
1. |
Pre-payment and/ or repayment of loans, funding the long term growth of its existing businesses; and general corporate purposes including organic or inorganic growth, making strategic acquisitions; financing other long term capital, working capital and or any other as may be permissible under applicable law(s) and approved by the Board of Directors of the Company. |
Nil |
131.74 |
0.00 |
131.74 |
0.00 |
2. |
Issue expenses |
Nil |
3.78 |
0.00 |
3.78 |
0.00 |
Total |
Nil |
135.52 |
0.00 |
135.52 |
0.00 |
The equity shares of the Company are listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The listing fee for the year 2023-24 has already been paid to both the Stock Exchanges.
ICRA Limited on April 25, 2023 has re-affirmed the ratings of the Company as per below given details and outlook on the longterm Rating is Stable.
instrument/Facilities |
Re-affirmed Rating |
(Long Term Facilities) Long Term Rating. |
[ICRA]AA (Stable) (pronounced ICRA double A ) with a stable outlook |
(Short Term Facilities) Short Term Rating. |
[ICRA]A1 (pronounced ICRA A one plus) |
Commercial paper. |
[ICRA]A1 (PRONOUNCED ICRA A ONE PLUS) |
MATERIAL CHANGES AND COMMITMENTS, IF ANY
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.
DISCLOSURES RELATING TO SUBSIDIARY COMPANY AND CONSOLIDATED FINANCIAL STATEMENTS
As on March 31, 2023, the Company has following subsidiaries Companies/Firms.
s. No. |
Name of the Companyfirm |
Status |
Country |
Holding |
1. |
SC Forma SA |
Subsidiary |
Romania |
89.52% |
2. |
Crane Kraft India Private Limited |
Wholly Owned Subsidiary |
India |
100% |
3. |
Namo Metals |
Partnership Firm |
India |
90.00% |
Note : SC Forms SA, Romania, a subsidiary of the Company is under voluntary dissolution and liquidation process as per applicable laws in Romania.
In accordance with Section 129(3) of the Companies Act, 2013, Regulations 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and applicable Accounting Standards, the Company has prepared consolidated financial statements of the Company and its subsidiaries, which form part of the Annual Report. For details please refer the Consolidated Financial Statements.
A statement containing the salient features of the financial statement/highlights of performance of our subsidiaries in the prescribed Form AOC-1 is attached as Annexure-I to this Report.
There are no associates and Joint Ventures Companies within the meaning of Section 2(6) of the Companies Act, 2013 (Act) and there has been no material change in the nature of the business of the subsidiaries except SC Forma SA which is under voluntary dissolution and liquidation process.
In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and accounts of its subsidiaries, are available on our website at www.ace-cranes.com. These documents will also be available for inspection during business hours at our registered office.
In terms of the Company''s Policy on determining "material subsidiary", during the financial year ended March 31, 2023, there is no material subsidiary of the Company whose income exceeds 10% of the consolidated income of the Company in the immediately preceding financial year.
The Policy for determining material subsidiaries may be accessed on the Company''s website at https://www.ace-cranes.com/ home/investor-policies-and-programme-codes.
In accordance with the provisions of Companies Act, 2013 (hereinafter referred as "the Act") and Articles of Association of the Company, Mr. Sorab Agarwal (DIN: 00057666), Whole-Time
Director of the Company will retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. Details related to his re-appointment as required to be disclosed under Companies Act/listing Regulations is given as Annexure-I, to the notice of 29th AGM.
The Board of Directors, in their meeting held on May 30, 2023, had recommended the re-appointment and remuneration of Mr. Vijay Agarwal (DIN:00057634), as Chairman & Managing Director, Mrs. Mona Agarwal (DIN:00057653), as Executive Director and Mr. Sorab Agarwal (DIN:00057666) as Executive Director for a further period of 5 years w.e.f. October 1, 2023, subject to the approval of the shareholders in the ensuing Annual General Meeting. Their appointment is appropriate and in the best interest of the Company. Details related to their reappointment as required to be disclosed under Companies Act/ listing Regulations is given as Annexure-I, to the notice of 29th AGM.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "the Listing Regulations").
In the opinion of Board of Directors of the Company, Independent Directors on the Board of Company hold highest standards of integrity and are highly qualified, recognized and respected individuals in their respective fields. It''s an optimum mix of expertise (including financial expertise), leadership and professionalism.
KEY MANAGERIAL PERSONNELS (KMP)
Pursuant to the provisions of Section 203 of the Companies Act, 2013 read with Rules made thereunder following are designated as Key Managerial Personnel (KMP) of the Company:
⢠Mr. Vijay Agarwal, Chairman & Managing Director;
⢠Mrs. Mona Agarwal, Whole-Time Director;
⢠Mr. Sorab Agarwal, Whole-Time Director;
⢠Mrs. Surbhi Garg, Whole-Time Director;
⢠Mr. Rajan Luthra, Chief Financial Officer (CFO); and
⢠Mr. Anil Kumar, Company Secretary & Compliance Officer.
number of board meetings
During the financial year 2022-23, four (4) Board Meetings were held. For details thereof kindly refer to the Corporate Governance Report forming part of this Annual Report.
Pursuant to the requirements of Schedule IV to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, separate Meeting of the Independent Directors of the Company was also held on February 06, 2023, without the presence of Non-Independent Directors and members of the management, to review the performance of Non-Independent Directors and the Board as a whole, the performance of the Chairperson of the Company, taking into account the views of Executive Directors, Non-Executive NonIndependent Directors and also to assess the quality, quantity and timeliness of flow of information between the Company management and the Board.
During the financial year 2022-23, 28th Annual General Meeting of the Company was held on September 20, 2022 at 12:00 noon through Video Conferencing ("VC")/Other Audio Visual Means ("OAVM").
The Board has 5 (Five) mandatory level committees: Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee and Risk Management Committee. During the year, all recommendations made by the committees were approved by the Board. A detailed note on the composition of the Board and its committees, including its terms of reference is provided in the Corporate Governance Report forming part of this Annual Report.
NOMINATION AND REMUNERATION pOLICY
The Board of Directors has framed a policy which lays down a framework in relation to remuneration and appointment of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to Executive and Non-Executive Directors (by way of sitting fees), Key Managerial Personnel, Senior Management and other employees. The policy also provides the criteria for determining qualifications, positive attributes and Independence of Director and criteria for appointment of Key Managerial Personnel / Senior Management and performance evaluation. The above
policy has been posted on the website of the Company at https://www.ace-cranes.com/home/investor-policies-and-programme-codes.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of clause (c) of Sub-section (3) of Section 134 of the Companies Act, 2013, your Directors hereby confirm that they:
(i) Have followed in the preparation of Annual Accounts for the financial year 2022-23, the applicable Accounting Standards and no material departures have been made for the same;
(ii) Had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;
(iii) Had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(iv) Had prepared the annual accounts on a going concern basis;
(v) Have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
(vi) Have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.
ANNUAL PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, Independent Directors at their separate meeting, without participation of the Non-Independent Directors and Management have considered and evaluated the Board''s performance and performance of the Chairman and Non- Independent Directors. The Independent Directors in the said meeting have also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board.
The Board of Directors has evaluated the performance of each of the Independent Directors (without participation of the relevant Director). The Board has carried out the annual evaluation of its own performance and that of its Directors individually. The evaluation criteria as approved by the Nomination and Remuneration Committee included various aspects of the functioning of Board such as composition, process and procedures
including adequate and timely information, attendance, decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was evaluated on various parameters such as industry knowledge & experience, vision, commitment, time devoted etc. The evaluation of Independent Directors was based on aspects like participation & contribution to the Board decisions, knowledge, experience and integrity etc.
As per provisions of Section 139(1) of the Act, the Company has appointed M/s B S R & Co. LLP, Chartered Accountants (Firm Regn. No. 101248W/W-100022) as Statutory Auditors of the Company for a period of 5 (Five) years (April 01, 2022 to March 31, 2027) i.e. till the conclusion of the 33rd AGM to be held in the calendar year 2027, in the AGM of the Company held on September 20, 2022.
Statutory Auditors'' Report
The observations of Statutory Auditors in its reports on standalone and consolidated financials are self-explanatory and therefore, do not call for any further comments. There are no qualifications, reservations or adverse remarks made by Statutory Auditors in their reports.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed thereunder, M/s Vasisht & Associates, Company Secretaries, were appointed as the Secretarial Auditors of the Company to carry out the secretarial audit for the year ending March 31, 2023.
Secretarial Audit Report
A Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as Annexure-II. There are no qualifications, reservations or adverse remarks made by Secretarial Auditors in their Report.
Pursuant to SEBI circular no CIR/CFD/CMD1/27/2019 dated February 08, 2019, in addition to secretarial audit, Annual Secretarial Compliance Report given by M/s Vasisht & Associates, Company Secretaries on compliance of all applicable SEBI Regulations and circulars/guidelines issued there under is annexed as Annexure-Ni.
As per Section 148 of the Companies Act, 2013, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.
Pursuant to the provisions of Section 141 read with Section 148 of the Companies Act, 2013 and Rules made thereunder, M/s Vandana Bansal & Associates, Cost Accountants (Firm Registration No. 100203) had been appointed as the Cost Auditor of the Company for the year ending March 31, 2023.
Cost audit report for financial year 2022-23 will be filed with the Ministry of Corporate Affairs within stipulated time period.
The Board of Directors of the Company has appointed Internal Auditor of the Company, to audit the function and activities of the Company and to review various operations of the Company; the Company continued to implement their suggestions and recommendations to improve the control environment.
DETAILS IN RESpECT OF Frauds REpORTED BY Auditors
other than those which are reportable to the central
The Statutory Auditors, Secretarial Auditors and Cost Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143 (12) of the Companies Act, 2013, including rules made there under.
corporate social responsibility (CSR)
The Company''s CSR activities are primarily done through its trust namely ACE Emergency Response Service. The CSR Committee of the Board of Directors has been formed comprising of three directors with Chairman being Independent Director. CSR Committee has framed and formulated a CSR Policy indicating the activities to be undertaken by the Company, in accordance with schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 issued under the Act. The same has also been approved and reviewed from time to time by the Board. The updated CSR policy is available at the website of the Company at https://www.ace-cranes.com/home/investor-policies-and-programme-codes.
The Annual Report FY 2022-23 on CSR Activities, as stipulated under the Act forms an Integral part of this Report and is appended as Annexure-IV.
Your Company reaffirms its commitment to the good corporate
governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards.
In compliance with Regulation 34 of the Listing Regulations a separate report on corporate governance along with a certificate from Practicing Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulations forms part of this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended is separately given and forms part of this Annual Report and provides a more detailed analysis on the performance of individual businesses and their outlook.
CONTRACTS OR ARRANGEMENTS WITH RELATED pARTIES
All contracts or arrangements or transactions that were entered into by the Company during the financial year with related parties were on an arm''s length basis and in the ordinary course of business. During the year, the Company had not entered into any contracts or arrangements or transactions with related parties which could be considered material in accordance with Companies Act and SEBI Regulations and the policy of the Company on materiality of related party transaction. All related party transactions have been approved by the Audit Committee and the Board.
Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of section 134 of the Act read with Rule 8 of the Company (Accounts) Rules, 2014 is given as Annexure-V to this report.
The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company''s website at https://www.ace-cranes.com/home/ investor-policies-and-programme-codes.
Your Directors draw attention of the members to note no. 33 in the notes to accounts in the Standalone Financial Statements which sets out related party disclosures.
The Audit Committee as on March 31, 2023 comprises of the following Directors: Mr. Avinash Parkash Gandhi (Chairman), Mr. Vijay Agarwal, Mr. Shriniwas Vashisht, and Dr. Jagan Nath Chamber as Members. For more details kindly refer to the section ''Committees of the Board-Audit Committee'', in the Corporate Governance Report, which forms part of this Annual Report. All recommendations of Audit Committee were accepted by the Board of Directors.
The Company has constituted a Risk Management Committee in Compliance with the requirements of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details of this Committee and its terms of reference are set out in the Corporate Governance Report, which forms part of this Annual Report.
The Company has also formulated the Risk Management Policy, to identify risks and minimize their adverse impact on business and strives to create transparency which in turn enhances the Company''s competitive advantage.
According to the aforesaid business risk policy, the Company has identified the business risks associated with its operations and an action plan for its mitigation of the same is put in place. The business risks and its mitigation have been dealt with in the Management Discussion and Analysis Section of this Annual Report.
The Company has in place adequate internal financial controls with reference to financial statements. Such controls were tested during the financial year and no material weaknesses in the design or operation were observed. Review of the financial controls is done on an ongoing basis.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company maintains adequate internal control system and procedures commensurate with its size and nature of operations. The internal control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorization of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances.
The internal control system includes a well-defined delegation of authority and a comprehensive Management Information System coupled with quarterly reviews of operational and financial performance, a well-structured budgeting process with regular monitoring of expenses and Internal audit. The Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.
During the year, such controls were tested and no reportable material weakness in the design or operation was observed.
WHISTLE BLOWER POLICY/ VIGIL MECHANISM
The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.
The Whistle Blower Policy is available on Company''s website at https://www.ace-cranes.com/home/investor-policies-and-programme-codes. During the year, no case of genuine concerns received under this policy.
COMpLIANCE WITH SECRETARIAL STANDARDS
The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and that such systems are adequate and operating effectively.
pOLICY ON pREVENTION, pROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT Of WOMEN AT WORKpLACE
The Company has laid down sexual harassment policy pursuant to provision of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The objective of this policy is to provide protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and for matters connected therewith. The Company has zero tolerance on sexual harassment at workplace. During the financial year 2022-23, no complaint was received under this policy.
Your Company continues to invest in a comprehensive Research & Development (R&D) programme to develop a unique source of sustainable competitive advantage and build future readiness by leveraging contemporary advances in several relevant areas of science and technology and blending the same with classical concepts of product development.
The Company has dedicated R&D centers at Jajru Road, Faridabad and at Dudhola Link Road, Dudhola Village, Palwal. Both these centers have accreditations from the Ministry of Science and Technology, Govt. of India. Both the centers continuously carries out Research and Developments for developing new products and also focus on the quality of products, making them more economical, cost effective and user friendly.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS pASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMpACTING THE GOING CONCERN STATUS AND COMpANY''S OpERATIONS IN FUTURE
There was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.
particulars of remuneration of directors/ kmp/
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure-VI to this Report.
During the year under review, the Company has not accepted any public deposits under Chapter V of the Companies Act, 2013 and as such, no amount on account of principal or interest on public deposits was outstanding as of March 31, 2023.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans, guarantees and investments under Section 186 of the Companies Act, 2013 as at the end of the financial year 2022-23 are provided in the notes to standalone financial statements.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under the Companies Act, 2013 is annexed as Annexure-VII and forms a part of this report.
The extracts of the Annual Return of the Company in Form MGT-9, as they stood on the close of the financial year i.e. March 31, 2023 is furnished in Annexure-VIII and forms part of this Report.
Further, a copy of the Annual Return of the Company containing the particulars prescribed under section 92 of the Companies Act, 2013, in Form MGT-7, as they stood on the close of the financial year i.e. March 31, 2022 is uploaded on the website of the Company at https://www.ace-cranes.com/home/mgt-7.
INVESTORS EDUCATION AND pROTECTION Fund (IEpF)
In accordance with the applicable provisions of Companies Act, 2013 read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF
Rules"), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven (7) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven (7) consecutive years or more shall be transferred to the demat account of the IEPF Authority.
The details relating to amount of dividend transferred to the IEPF authority and corresponding shares on which dividends were unclaimed for seven (7) consecutive years, are provided in the Corporate Governance Report section of this Annual Report.
Your Company continues to deliver unmatched performance amongst its peers and has been conferred with awards every year. The Company was awarded with many awards and recognition. The significant award includes:
⢠Transformative Trailblazing Leader - Mr Vijay Agarwal by Business Icons of India;
⢠Innovative Construction Equipment Award by CE&CR Magazine;
⢠Fortune India- Ranked 171 in the Next 500 Companies;
⢠India''s 20 Most Impactful Power Brands by Daily Indian Media;
⢠Power Brands India''s Most Dynamic Leader-2022 to Mr. Vijay Agarwal;
⢠Bestseller in Mobile Cranes Category Award- 10th Equipment India Awards 2022;
⢠Person of the Year Award to Mr. Sorab Agarwal by Equipment India 2022;
⢠Best n Sales - Pick & Carry Cranes at Equipment Times Award Feb 2023.
BUSINESS RESpONSIBILITY AND SUSTAINABILITY REpORT (BRSR)
Pursuant to the provision of Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report (BRSR) for the financial year 2022- 23 is annexed as Annexure-IX and forms a part of this report.
In compliance with the provisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, the Board of Directors of the Company have adopted the Dividend Distribution Policy of the Company ("the Policy"). The policy inter alia, lays down various parameters relating to declaration/recommendation of dividend. The policy is available on the Company''s website at weblink : https://www. ace-cranes.com/public/front/pdf/Dividend_Distribution_Policy_ ACE_2021.pdf
OTHER INFORMATION
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review or said items are not applicable to the Company:
1. The Managing Director and the Whole Time Directors has not received any remuneration or commission from any of its subsidiaries.
2. During the year under review, the company has not done any buy back of equity shares.
3. The Disclosure pertaining to explanation for any deviation or variation in connection with certain terms of a public issue, right issue, preferential issue etc. is not applicable to the Company.
4. No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable;
5. The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable; and
6. Your Company does not fall under the category of large corporate, as defined under SEBI vide its circular SEBI/HO/ DDHS/CIR/P/2018/144 dated November 26, 2018, as such no disclosure is required in this regard.
ACKNOWLEDGEMENT
The Board places on record its appreciation for the support and continued co-operation extended by all the customers, vendors, dealers, bankers, regulators and business associates. The Board places on record its appreciation to all the employees for their dedicated and committed services. Your Directors deeply acknowledgethe continued trust and confidence that the shareholders place in the management and is confident that with their continued support, the Company will achieve its objectives and emerge stronger in the coming years.
Action Construction Equipment Limited
Sd/
Place : Faridabad Vijay Agarwal
Date : May 30, 2023 Chairman & Managing Director
Mar 31, 2022
Your Directors are pleased to present the 28th Annual Report on the business and operation of the Company together with Audited Statement of Accounts for the financial year ended March 31, 2022.
The Company''s financial performance for the year ended March, 2022 is summarized below:
( '' in Crores |
||||
PARTICULARS |
Standalone |
Consolidated |
||
FY 2021-22 |
FY 2020-21 |
FY 2021-22 |
FY 2020-21 |
|
Revenue from operations |
1630.34 |
1227.01 |
1629.58 |
1227.15 |
Other Income |
15.02 |
15.31 |
15.02 |
15.31 |
Total Income |
1645.36 |
1242.32 |
1644.60 |
1242.46 |
Earnings Before Depreciation, Finance costs, Exceptional Items and Tax |
167.35 |
134.65 |
166.46 |
134.28 |
Less: Depreciation and amortization expenses |
15.28 |
13.94 |
15.41 |
13.94 |
Less: Finance Costs |
13.73 |
12.23 |
13.75 |
12.23 |
Profit before exceptional items and Tax |
138.34 |
108.48 |
137.30 |
108.11 |
Less: Exceptional items |
- |
- |
- |
- |
Profit Before Tax |
138.34 |
108.48 |
137.30 |
108.11 |
Less: Tax expense (Net) |
32.43 |
28.32 |
32.30 |
28.32 |
Profit After Tax |
105.91 |
80.16 |
105.00 |
79.79 |
Other Comprehensive income for the year (net of tax) |
-0.35 |
0.76 |
-0.35 |
0.76 |
Total Comprehensive income for the year |
105.56 |
80.92 |
104.65 |
80.55 |
FINANCIAL PERFORMANCE OVERVIEW (STANDALONE BASIS)
The brief highlights of the Company''s performance (standalone) during the financial year 2021-22:
⢠Total revenue from operations increased to '' 1630.34 crores as against '' 1227.01 crores in the previous year - an increase of 32.87%.
⢠Earnings before Interest, Depreciation, Amortization, Exceptional Items & Tax for the current year is '' 167.35 crores against '' 134.65 crores in the previous year - an increase of 24.29%.
⢠Profit before Tax (PBT) and Profit after Tax (PAT) for the current year are '' 138.34 crores and '' 105.91 crores respectively against '' 108.48 crores and '' 80.16 crores in the previous year - an increase of 27.53% and 32.12% respectively.
⢠Earnings per share is Rs.9.10 for the year under review. STATE OF COMPANY''S AFFAIRS
FY 2021-22 turned out to be another challenging year for the Indian economy, marked by heightened uncertainty and volatility due to the COVID pandemic. The year began with the second wave of the pandemic having a devastating socio-economic impact in the country followed by a sharp drop in its intensity, which aided smart recovery in economic activity that reached pre-pandemic levels towards the end of the second quarter. Even as economic prospects started looking up, the country was hit hard by the third wave with new cases rising exponentially across major cities and halting the recovery momentum. Just as the third wave had abated in India, geopolitical tensions in Europe sparked off a fresh round of uncertainty in the operating environment.
While the pandemic has still not ended, the world has started reopening and recovering, and ACE has also kept pace with it and delivered steady financial performance. Against the
backdrop of a weak market amid rising raw material costs and subdued rural demand, we managed to grow our standalone revenues from operations by 32.87% y-o-y to '' 1630.34 crores, our highest ever. Margins, however, remained under pressure due to elevated raw material prices and commodity inflation. This year the inflationary pressure has been unprecedented, the material cost since FY2021 till date has escalated to high levels and we have managed to pass on a large chunk of this through price increases, but we are still carrying forward some of the unabsorbed inflation which is putting pressures on our margins.
While the inflationary environment continues to pose a challenge, however, we maintain a positive outlook on demand growth and gradual recovery of margins.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of the business of the Company during the financial year ended March 31, 2022.
AMOUNTS TRANSFERRED TO RESERVES
During the year under review, there was no amount transferred to any of the reserves by the Company.
The Board of Directors at their meeting held on May 23, 2022, has recommended payment of '' 0.60 i.e. (30%) per equity share of the face value of '' 2 (Rupee Two Only) each as final dividend for the financial year ended March 31, 2022. The payment of final dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company. share capital & QUALIFIED INSTITUTIONAL PLACEMENTS (QIP)
The paid up Equity Share Capital of the Company as at March 31, 2022 stood at '' 23.82 crores. During the year under review, pursuant to the provisions of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended (the "SEBI ICDR Regulations"), and pursuant to the resolutions
of the Board of Directors of the Company dated July 31, 2021 authorizing Qualified Institutions Placement Committee ("QIP Committee"), the special resolution dated September 3, 2021, passed by the shareholders of the Company and Section 42 and Section 62 of the Companies Act, 2013, as amended and inprinciple approvals granted by BSE Limited and the National Stock Exchange of India Limited ("Stock Exchanges"), the Company has issued and allotted 56,00,000 Equity Shares of face value of '' 2 each through Qualified Institutional Placements (QIP) to eligible qualified institutional buyers at the issue price of '' 242 per Equity Shares (including a premium of '' 240 per Equity Shares) against the Floor Price of '' 254.55 per Equity Shares, aggregating to '' 135.52 Crore.
Pursuant to the allotment of above-mentioned Equity Shares, the paid-up equity share capital of the Company stands increased from '' 22.70 crore, comprising of 11,34,83,196 Equity Shares to '' 23.82 crore, comprising of 11,90,83,196 Equity Shares.
BSE Limited and National Stock Exchange of India Limited has granted listing approval for 56,00,000 Equity Shares of '' 2/-each bearing dist. Nos. 117323001 to 122923000 issued to QIBs through Qualified Institutional Placement on September 24, 2021.
BSE Limited and National Stock Exchange of India Limited has granted trading approval for 56,00,000 Equity Shares of '' 2/-each bearing dist. Nos. 117323001 to 122923000 allotted to QIBs through Qualified Institutional Placement w.e.f. September 28, 2021.
No promoter(s) of the Company has been alloted any shares under aforesaid QIP.
None of the Directors of the Company hold instruments convertible into Equity Shares of the Company.
During the year under review, the Company has not issued any:
(a) Shares with differential rights;
(b) Sweat equity shares;
(c) Bonus shares;
(d) Debenture, bond and any other securities.
During the year, the company has not done any buy back of equity shares.
DISCLOSURE RELATING TO EMPLOYEE STOCK OPTION SCHEME
During the year under review, the Nomination and Remuneration Committee of the Board and the Board of Directors approved the ''Action Construction Equipment Limited Employee Stock Option Scheme 2021'' ("Scheme"). The Scheme was approved by the members of the Company at the 27th Annual General Meeting held on September 03, 2021.
The Company during the year has not taken any action for implementing the scheme. Therefore once the scheme will be implemented, required disclosed/details will be provided.
RE-CLASSIFICATION OF AUTHORISED SHARE CAPITAL
Pursuant to the provisions of Sections 13, 61 and other applicable provisions, of the Companies Act, 2013 and the Articles of Association of the Company and approval of the members in their 27th AGM held on September 03, 2021, the authorized share capital of the Company has been reclassified from '' 55,25,00,000 (Rupees Fifty Five Crore Twently Five Lakhs only) divided into 12,50,00,000 (Twelve Crore Fifty Lakhs) Equity Shares of '' 2 (Rupees Two) each and 3,02,50,000 (Three Crore Two Lakhs Fifty Thousand) 8% Redeemable cumulative Preference Shares of '' 10 (Rupees Ten) each to '' 55,25,00,000 (Rupees Fifty Five Crore Twently Five Lakhs only) divided into 27,62,50,000 (Twenty Seven Crore Sixty Two Lakhs Fifty Thousand) Equity Shares of '' 2 (Rupees Two) each and consequently the existing Clause V of the Memorandum of Association of the Company, relating to the Share Capital be and is hereby altered by deleting the same and substituting in its place and stead, the following new Clause V:
''V'' The Authorised Share Capital of the Company is '' 55,25,00,000 (Rupees Fifty Five Crore Twenty Five Lakhs only) divided into 27,62,50,000 (Twenty Seven Crore Sixty Two Lakhs Fifty Thousand) Equity Shares of '' 2 (Rupees Two) each.
The equity shares of the Company are listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The listing fee for the year 2022-23 has already been paid to both the Stock Exchanges.
ICRA Limited on April 05, 2022 has upgraded the long term rating to [ICRA]AA (pronounced ICRA Double A) from [ICRA]AA-(pronounced ICRA Double A Minus) and re-affirmed the shortterm rating at [ICRA]A1 (pronounced ICRA A One Plus). The outlook on the long-term Rating has been revised to Stable from Positive. Further, rating action details are given herein below:
Instrument/ Facilities |
Rating (March 31, 2022) |
Revised Rating (April 05, 2022) |
(Long Term Facilities) Long Term Rating |
[ICRA]AA- (Positive) (pronounced ICRA double A minus) with a positive outlook |
[ICRA]AA (Stable) (pronounced ICRA double A ) with a stable outlook |
(Short Term Facilities) Short Term Rating |
[ICRA]A1 (pronounced ICRA A one plus) |
[ICRA]A1 (pronounced ICRA A one plus) (reaffirmed). |
Commercial paper |
[ICRA]A1 (pronounced ICRA A one plus) |
[ICRA]A1 (pronounced ICRA A one plus) (reaffirmed) |
MATERIAL CHANGES AND COMMITMENTS, IF ANY
The foreign subsidiary Company i.e. SC Forma SA, Romania has sold entire land & building situated in Romania for consideration of '' 19.58 crore (1 RON = 16.7520 INR). Except this matter, no other material changes and commitments affecting the financial
position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.
DISCLOSURES RELATING TO SUBSIDIARY COMPANY AND CONSOLIDATED FINANCIAL STATEMENTS
During the year under review, pursuant to the provisions of Section 186 read with Rules made there under, the Company has made investment(s) by way of purchase of equity shares from shareholders of M/s Crane Kraft India Private Limited and subscription of equity shares by way of right issue amounting in total '' 59,99,980/-.
Further, consequence to above investment(s), Crane Kraft India Private Limited has become the ''subsidiary'' of the Company as per applicable provision of Companies Act, 2013 and rules made there under.
As on March 31, 2022, the Company has following subsidiaries Companies/Firms.
S. No. |
Name of the Company/Firm |
Status |
Country |
Holding |
1 |
SC Forma SA |
Subsidiary Company |
Romania |
89.52% |
2 |
Crane Kraft India Private Limited |
Subsidiary Company |
India |
99.9999% |
3 |
Namo Metals |
Partnership Firm |
India |
90.00% |
In accordance with Section 129(3) of the Companies Act, 2013, Regulations 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and applicable Accounting Standards, the Company has prepared consolidated financial statements of the Company and its subsidiaries, which form part of the Annual Report. For details please refer the Consolidated Financial Statements.
A statement containing the salient features of the financial statement/highlights of performance of our subsidiaries in the prescribed Form AOC-1 is attached as Annexure-I to this Report.
There are no associates and Joint Ventures Companies within the meaning of Section 2(6) of the Companies Act, 2013 (Act) and there has been no material change in the nature of the business of the subsidiaries.
In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and accounts of its subsidiaries, are available on our website at www.ace-cranes.com. These documents will also be available for inspection during business hours at our registered office.
The Policy for determining material subsidiaries may be accessed on the Company''s website at www.ace-cranes.com.
During the year under review, on the recommendation of Board, the members of the Company in their 27th Annual General Meeting ("AGM") held on September 03, 2021 at 12:00 Noon IST through Video Conferencing ("VC")/ Other Audio Video Means ("OAVM") have approved the appointment of Dr. Jagan Nath Chamber (DIN:08841478) as an Independent Non-Executive Director of the Company for five years w.e.f. November 06, 2020.
In accordance with the provisions of Companies Act, 2013 (hereinafter referred as "the Act") and Articles of Association of the Company, Mrs. Surbhi Garg (DIN: 01558782), Whole-Time Director of the Company will retire by rotation at the ensuing AGM and being eligible, offers herself for re-appointment. Details related to her re-appointment as required to be disclosed under Companies Act/listing Regulations is given as Annexure-I, to the notice of 28th AGM.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "the Listing Regulations").
In the opinion of Board of Directors of the Company, Independent Directors on the Board of Company hold highest standards of integrity and are highly qualified, recognized and respected individuals in their respective fields. It''s an optimum mix of expertise (including financial expertise), leadership and professionalism.
KEY MANAGEmAL pERSONNELS (KMp)
Pursuant to the provisions of Section 203 of the Companies Act, 2013 read with Rules made thereunder following are designated as Key Managerial Personnel (KMP) of the Company:
⢠Mr. Vijay Agarwal, Chairman & Managing Director;
⢠Mrs. Mona Agarwal, Whole-Time Director;
⢠Mr. Sorab Agarwal, Whole-Time Director;
⢠Mrs. Surbhi Garg, Whole-Time Director;
⢠Mr. Rajan Luthra, Chief Financial Officer (CFO); and
⢠Mr. Anil Kumar, Company Secretary & Compliance Officer.
During the financial year 2021-22, four (4) Board Meetings were held. For details thereof kindly refer to the Corporate Governance Report forming part of this Annual Report.
Pursuant to the requirements of Schedule IV to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, separate Meeting of the Independent Directors of the Company was also held on February 5, 2022, without the presence of Non-Independent Directors and members of the management, to review the performance of Non-Independent Directors and the Board as a whole, the performance of the Chairperson of the Company, taking into account the views of Executive Directors, Non-Executive NonIndependent Directors and also to assess the quality, quantity and timeliness of flow of information between the Company management and the Board.
During the financial year 2021-22, 27th Annual General Meeting of the Company was held on September 03, 2021 at 12:00 noon through Video Conferencing ("VC")/Other Audio Visual Means ("OAVM").
The Board has 7 (Seven) committees: Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Corporate Social Responsibility Committee, Risk Management Committee, Committee of Board (COB) and Qualified Institutions Placement Committee. During the year, all recommendations made by the committees were approved by the Board. A detailed note on the composition of the Board and its committees, including its terms of reference is provided in the Corporate Governance Report forming part of this Annual Report.
The composition and terms of reference of all the Committee(s) of the Board of Directors of the Company is in line with the provisions of the Act and Listing Regulations.
NOMINATION AND REMUNERATION POLICY The Board of Directors has framed a policy which lays down a framework in relation to remuneration and appointment of Directors, Key Managerial Personnel and Senior Management of the Company. The Policy broadly lays down the guiding principles, philosophy and the basis for payment of remuneration to Executive and Non-Executive Directors (by way of sitting fees), Key Managerial Personnel, Senior Management and other employees. The policy also provides the criteria for determining qualifications, positive attributes and Independence of Director and criteria for appointment of Key Managerial Personnel / Senior Management and performance evaluation. The above policy has been posted on the website of the Company at www. ace-cranes.com under investor relation section.
DIRECTORS'' RESpONSIBILITY STATEMENT
Pursuant to the provisions of clause (c) of Sub-section (3) of Section 134 of the Companies Act, 2013, your Directors hereby confirm that they:
i) Have followed in the preparation of Annual Accounts for the financial year 2021-22, the applicable Accounting Standards and no material departures have been made for the same;
ii) Had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;
iii) Had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) Had prepared the annual accounts on a going concern basis;
v) Have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) Have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.
ANNUAL pERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 (3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, Independent Directors at their separate meeting, without participation of the Non-Independent Directors and Management have considered and evaluated the
Board''s performance and performance of the Chairman and NonIndependent Directors. The Independent Directors in the said meeting have also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board.
The Board of Directors has evaluated the performance of each of the Independent Directors (without participation of the relevant Director). The Board has carried out the annual evaluation of its own performance and that of its Directors individually. The evaluation criteria as approved by the Nomination and Remuneration Committee included various aspects of the functioning of Board such as composition, process and procedures including adequate and timely information, attendance, decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was evaluated on various parameters such as industry knowledge & experience, vision, commitment, time devoted etc. The evaluation of Independent Directors was based on aspects like participation & contribution to the Board decisions, knowledge, experience and integrity etc.
As per provisions of Section 139(1) of the Act, the Company has appointed M/s BRAN & Associates, Chartered Accountants (Firm Regn. No. 014544N) as Statutory Auditors of the Company for a period of 5 (Five) years (April 01, 2017 to March 31, 2022) i.e. till the conclusion of the 28th AGM to be held in the calendar year 2022, in the AGM of the Company held on September 29, 2017.
Further, as per provisions of Section 139(1) of the Companies Act, 2013, at the forthcoming Annual General Meeting, M/s BRAN & Associates, Chartered Accountants are completing their 1st term of five consecutive year as Statutory Auditors.
The Board, considering the size of organization and upon the recommendation of the Audit Committee, has recommended to shareholders'' approval for appointment of M/s B S R & Co., LLP, Chartered Accountants (Registration No. 101248W/W-100022) as statutory auditors (in place of M/s BRAN & Associates, Chartered Accountants, the auditors who will complete a tenure of 5 consecutive years at this 28th AGM) for a first term of 5 (five) consecutive years from the conclusion of this 28th Annual General Meeting until the conclusion of the 33rd Annual General Meeting of the Company to be held in the calendar year 2027 (FY 2022-23 to 2026-27).
Accordingly, an item for appointment of M/s BSR & Co., LLP as the statutory Auditors of the Company for a period of 5 (five) years is being placed at the ensuing 28th AGM for approval of the Members.
Information about the proposed appointment of M/s BSR & Co., LLP is given under the Notice of 28th AGM, which forms part of this Annual Report.
The observations of Statutory Auditor in its reports on standalone
and consolidated financials are self-explanatory and therefore, do not call for any further comments. There are no qualifications, reservations or adverse remarks made by Statutory Auditors in their reports.
secretarial auditors
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed thereunder, M/s Vasisht & Associates, Company Secretaries, were appointed as the Secretarial Auditors of the Company to carry out the secretarial audit for the year ending March 31, 2022.
A Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as Annexure-II. There are no qualifications, reservations or adverse remarks made by Secretarial Auditors in their Report.
Pursuant to SEBI circular no CIR/CFD/CMD1/27/2019 dated February 08, 2019, in addition to secretarial audit, Annual Secretarial Compliance Report given by M/s Vasisht & Associates, Company Secretaries on compliance of all applicable SEBI Regulations and circulars/guidelines issued thereunder is annexed as Annexure-III.
As per Section 148 of the Companies Act, 2013, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.
Pursuant to the provisions of Section 141 read with Section 148 of the Companies Act, 2013 and Rules made thereunder, M/s Vandana Bansal & Associates, Cost Accountants (Firm Registration No. 100203) has been appointed as the Cost Auditor of the Company for the year ending March 31, 2022.
Cost audit report for financial year 2021-22 will be filed with the Ministry of Corporate Affairs within stipulated time period.
The Board of Directors of the Company has appointed Internal Auditor of the Company, to audit the function and activities of the Company and to review various operations of the Company; the Company continued to implement their suggestions and recommendations to improve the control environment.
DETAILS IN RESpECT OF FRAUDS REpORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REpORTABLE TO THE CENTRAL GOVERNMENT
The Statutory Auditors, Secretarial Auditors and Cost Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143 (12) of the Companies Act, 2013, including rules made there under.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company''s CSR activities are primarily done through its trust namely ACE Emergency Response Service. The CSR Committee of the Board of Directors has been formed comprising of three directors with Chairman being Independent Director. CSR Committee has framed and formulated a CSR Policy indicating the activities to be undertaken by the Company, in accordance with schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 issued under the Act. The same has also been approved and reviewed from time to time by the Board. The updated CSR policy is available at the website of the Company at www.ace-cranes.com.
The Annual Report FY 2021-22 on CSR Activities, as stipulated under the Act forms an Integral part of this Report and is appended as Annexure-IV.
Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards.
In compliance with Regulation 34 of the Listing Regulations a separate report on corporate governance along with a certificate from Practicing Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulations forms part of this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as amended is separately given and forms part of this Annual Report and provides a more detailed analysis on the performance of individual businesses and their outlook.
CONTRACTS OR ARRANGEMENTS WITH RELATED pARTIES
All contracts or arrangements or transactions that were entered into by the Company during the financial year with related parties were on an arm''s length basis and in the ordinary course of business. During the year, the Company had not entered into any contracts or arrangements or transactions with related parties which could be considered material in accordance with Companies Act and SEBI Regulations and the policy of the Company on materiality of related party transaction. All related party transactions have been approved by the Audit Committee and the Board.
Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of section 134 of the Act read with Rule 8 of the Company (Accounts) Rules, 2014 is given as Annexure-V to this report.
The Audit Committee as on March 31, 2022 comprises of the following Directors: Mr. Avinash Parkash Gandhi (Chairman), Mr. Vijay Agarwal, Mr. Shriniwas Vashisht, and Dr. Jagan Nath Chamber as Members. For more details kindly refer to the section ''Committees of the Board-Audit Committee'', in the Corporate Governance Report, which forms part of this Annual Report. All recommendations of Audit Committee were accepted by the Board of Directors.
The Company has constituted a Risk Management Committee in Compliance with the requirements of Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The details of this Committee and its terms of reference are set out in the Corporate Governance Report, which forms part of this Annual Report.
The Company has also formulated the Risk Management Policy, to identify risks and minimize their adverse impact on business and strives to create transparency which in turn enhances the Company''s competitive advantage.
According to the aforesaid business risk policy, the Company has identified the business risks associated with its operations and an action plan for its mitigation of the same is put in place. The business risks and its mitigation have been dealt with in the Management Discussion and Analysis Section of this Annual Report.
The Company has in place adequate internal financial controls with reference to financial statements. Such controls were tested during the financial year and no material weaknesses in the design or operation were observed. Review of the financial controls is done on an ongoing basis.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company maintains adequate internal control system and procedures commensurate with its size and nature of operations. The internal control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorization of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances.
The internal control system includes a well-defined delegation of authority and a comprehensive Management Information System coupled with quarterly reviews of operational and financial performance, a well-structured budgeting process with regular monitoring of expenses and Internal audit. The Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.
WHISTLE BLOWER pOLICY/ VIGIL MECHANISM
The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual
or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. The Whistle Blower Policy is available on Company''s website at www.ace-cranes.com. During the year, no case of genuine concerns received under this policy.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) and that such systems are adequate and operating effectively.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has laid down sexual harassment policy pursuant to provision of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The objective of this policy is to provide protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and for matters connected therewith. The Company has zero tolerance on sexual harassment at workplace. During the financial year 2021-22, no complaint was received under this policy.
Your Company continues to invest in a comprehensive Research & Development (R&D) programme to develop a unique source of sustainable competitive advantage and build future readiness by leveraging contemporary advances in several relevant areas of science and technology and blending the same with classical concepts of product development.
The Company has dedicated R&D centers at Jajru Road, Faridabad and at Dudhola Link Road, Dudhola Village, Palwal. Both these centers have accreditations from the Ministry of Science and Technology, Govt. of India. Both the centers continuously carries out Research and Developments for developing new products and also focus on the quality of products, making them more economical, cost effective and user friendly.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE
There was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.
PARTICULARS OF REMUNERATION OF DIRECTORS/ kMP/ EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure-VI to this Report.
During the year under review, the Company has not accepted any public deposits under Chapter V of the Companies Act, 2013 and as such, no amount on account of principal or interest on public deposits was outstanding as of March 31, 2022.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans, guarantees and investments under Section 186 of the Companies Act, 2013 as at the end of the financial year 2021-22 are provided in the notes to standalone financial statements.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under the Companies Act, 2013 is annexed as Annexure-VII and forms a part of this report.
The extracts of the Annual Return of the Company in Form MGT-9, as they stood on the close of the financial year i.e. March 31, 2022 is furnished in Annexure-VIII and forms part of this Report.
Further, a copy of the Annual Return of the Company containing the particulars prescribed under section 92 of the Companies Act, 2013, in Form MGT-7, as they stood on the close of the financial year i.e. March 31, 2021 is uploaded on the website of the Company i.e. www.ace-cranes.com in the Investor Relations Section.
INVESTORS EDUCATION AND PROTECTION FUND (IEPF)
In accordance with the applicable provisions of Companies Act, 2013 read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven (7) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven (7) consecutive years or more shall be transferred to the demat account of the IEPF Authority.
The details relating to amount of dividend transferred to the IEPF authority and corresponding shares on which dividends were unclaimed for seven (7) consecutive years, are provided in the Corporate Governance Report section of this Annual Report.
Your Company continues to deliver unmatched performance amongst its peers and has been conferred with awards every year. The Company was awarded with many awards and recognition. The significant award includes:
⢠Best Company of the Year (Manufacturing) Award at the Business Leader of the Year Awards;
⢠Most Trusted Construction Equipment Manufacturer of the Year, Award at Business Leader Awards;
⢠Best Mobile Crane Brand 2021 by Construction Week;
⢠Innovative New Equipment Launched 2021 by Construction Week;
⢠Award for Managing Health at Work 2021 by CMO Asia;
⢠Market Leadership Award 2021 by CMO Asia;
⢠Outstanding Contribution in the Field of Logistics & Supply Chain Sector 2021 by CMO Asia;
⢠Best Company in Cranes & Tower Cranes 2021 by CIA World;
⢠Best Innovative Product of the Year 2021 by CIA World;
⢠Best Seller in Mobile Cranes 2021 by Equipment India;
⢠Innovation of the Year 2021 by Equipment India;
⢠India''s Top Challengers 2021 by Construction World;
⢠Transformative Trailblazing Leader - Mr Vijay Agarwal by Business Icons of India.
BUSINESS RESPONSIBILITY REPORT
Pursuant to the provision of Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Resposibility Report (BRR) for the financial year 202122 is annexed as Annexure-IX.
In compliance with the provisions of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, the Board of Directors of the Company have adopted the Dividend Distribution Policy of the Company ("the
Policy"). The policy inter alia, lays down various parameters relating to declaration/ recommendation of dividend. The policy is available on the Company''s website at www.ace-cranes.com.
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review or said items are not applicable to the Company:
1. The Managing Director and the Whole Time Directors has not received any remuneration or commission from any of its subsidiaries.
2. The Disclosure pertaining to explanation for any deviation or variation in connection with certain terms of a public issue, right issue, preferential issue etc. is not applicable to the Company.
3. No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year is not applicable; and
4. The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.
5. Your Company does not fall under the category of large corporate, as defined under SEBI vide its circular SEBI/HO/ DDHS/CIR/P/2018/144 dated November 26, 2018, as such no disclosure is required in this regard.
The Board places on record its appreciation for the support and continued co-operation extended by all the customers, vendors, dealers, bankers, regulators and business associates. The Board places on record its appreciation to all the employees for their dedicated and committed services. Your Directors deeply acknowledge the continued trust and confidence that the shareholders place in the management and is confident that with their continued support, the Company will achieve its objectives and emerge stronger in the coming years.
Action Construction Equipment LimitedSd/-
Vijay Agarwal
place : New Delhi Chairman & Managing Director
Date : August 10, 2022 DIN: 00057634
Mar 31, 2018
The Directors are pleased to present the 24th Annual Report on the business and operation of the Company together with Audited Statement of Accounts for the financial year ended March 31, 2018.
FINANCIAL RESULTS (Rs. in Lakhs)
PARTICULARS |
2017-18 |
2016-17 |
Revenue from operations |
1,09,864.26 |
79,706.33 |
Other Income |
794.28 |
781.06 |
Total Income |
1,10,658.54 |
80,487.39 |
Profit Before Depreciation, Finance cost and Tax |
10,007.43 |
4,770.43 |
Less: |
||
Depreciation and amortisation expenses |
1,193.35 |
1,206.87 |
Finance Costs |
1,352.66 |
1,596.22 |
Profit Before Tax |
7,461.42 |
1,967.34 |
Tax expense |
2,197.92 |
520.73 |
Profit After Tax |
5,263.50 |
1,446.61 |
Other Comprehensive income for the year (net of tax) |
3.31 |
0.84 |
Total Comprehensive income for the year |
5,266.81 |
1,447.45 |
FINANCIAL PERFORMANCE OVERVIEW (STANDALONE BASIS)
The brief highlights of the Company''s performance (standalone) for the financial year ended March 31, 2018 are:-
- Total Revenue from operations of the Company for FY 2018 of Rs. 1,09,864 Lakhs was higher by 37.84% over the last year (Rs. 79,706 Lakhs in FY 2017).
- Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 10,007 Lakhs was higher by 109.78%.
- Profit Before Tax (PBT) stood at Rs. 7,461 Lakhs and Profit After Tax (PAT) stood at Rs. 5,264 Lakhs higher by 279.31% and 263.79% respectively.
- Earnings per share is Rs. 4.49 for the year under review.
Your Company has taken several steps to reduce the cost and increase its market share in all products.
STATE OF COMPANY''S AFFAIRS
The Financial Year 2017-18 was a significant year in terms of growth and sustainability and the Company has been able to clock the highest ever turnover in the history of the Company during this financial year.
Against the backdrop of challenging market environment, your Company''s business continues to track ahead satisfactorily on the back of dynamic response to market trends, enduring customer relationships, "Customer First approach" and strong product portfolio.
The financial year 2017-18, saw a resilience in the operating margins due to focused cost efficiency measures, price discipline and optimzation of working capital requirements in order to minimize financing Costs. We believe that these measures will continue to be our focus in the future as we move towards increasing our margin profile.
During the year, we introduced smart features in our existing product range that not only helped us to increase our market share but also adhere to our core philosophy of providing customised soluti ons to our customers. ACE realigned its focus on domestic markets and growth. ACE sustained its investment in brand and manpower to prepare for next growth phase.
INDIAN ACCOUNTING STANDARDS (Ind AS)
In accordance with the notification issued by the Ministry of Corporate Affairs (MCA), your Company is required to prepare financial statements under Indian Accounting Standards (Ind AS) prescribed under section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016 with effect from April 1, 2017. Ind AS has replaced the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013, read with Rule 7 of Companies (Accounts) Rules, 2014.
Accordingly, your Company has adopted Indian Accounting Standard ("Ind AS") with effect from April 1, 2017 with the transition date of April 1, 2016 and the Financial Statements for the year ended March 31, 2018 have been prepared in accordance with Ind AS. The financial statements for the year ended March 31, 2017 have been restated to comply with Ind AS to make them comparable.
Explanations capturing areas of differences and reconciliations from Indian GAAP to Ind AS have been provided in the notes to accounts to the standalone and consolidated financial statements.
AMOUNTS TRANSFERRED TO RESERVES
The Company proposes to transfer Rs. 100 lakhs in the General Reserve and Rs. 1,313.16 lakhs in the Capital Redemption Reserve out of the amount available for appropriation in the Profit & Loss account.
DIVIDEND
The Board has recommended a final dividend of Rs. 0.50 i.e. (25%) per equity share for the financial year ended March 31, 2018, which will result in an outflow of Rs. 706.04 lakhs (including Corporate Dividend Tax of Rs. 119.42 lakhs).
The Board has recommended a dividend of 8% on Preference Share Capital of the Company which will result in an outflow of Rs. 287.50 lakhs (including Corporate Dividend Tax of Rs. 48.63 lakhs).
The payment of dividends is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in the nature of the business of the Company during the financial year ended March 31, 2018.
LISTING OF SHARES
The equity shares of the Company are listed on the National Stock Exchange of India Ltd. (NSE) and BSE Limited (BSE). The listing fee for the year 2018-19 has already been paid to the credit of both the Stock Exchanges.
Company''s 8% cumulative non-participating redeemable preference shares are not listed on any of the Stock Exchange(s).
CREDIT RATING
During the year CRISIL has upgraded Company''s rating on the long term bank facilities to CRISIL A /stable from CRISIL A/positive and reaffirmed the rati ng on the short-term bank facilities and commercial paper programme at CRISIL A1.
The rating upgrade reflects expectation of continued improvement in the business risk profile over medium term, driven by sustained pick-up in demand from the construction sector, particularly roads. The ratings reflect a diversified customer base in the material-handling equipment, cranes, and tractor industries, a strong market position in the cranes business, and comfortable liquidity.
SUBSIDIARY COMPANIES
As at financial year ended March 31, 2018, your Company has one wholly owned subsidiary (WOS) viz; Frested Limited, Mauritius and one Indirect subsidiary (Fellow Subsidiary) i.e. SC Forma SA, Romania.
There are no associate companies within the meaning of Section 2(6) of the Companies Act, 2013 (Act). There has been no material change in the nature of the business of the subsidiaries.
In accordance with Secti on 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and its subsidiaries, which form part of the Annual Report. For details please refer the Consolidated Financial Statements.
Further, a statement containing the salient features of the financial statement/highlights of performance of our subsidiaries in the prescribed Form AOC 1 is attached as Annexure-1 to this Report.
In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries, are available on our website www.ace-cranes.com. These documents will also be available for inspection during business hours at our Registered office.
The Policy for determining material subsidiaries may be accessed on the Company''s website at www.ace-cranes.com.
BOARD OF DIRECTORS
In accordance with the provisions of Companies Act, 2013 (hereinafter referred as "the Act") and Articles of Association of the Company, Mrs. Mona Agarwal (DIN: 00057653), Whole-Time Director will retire by rotati on at the ensuing AGM and being eligible, offers herself for re-appointment.
The Board of Directors, in their meeti ng held on May 21, 2018, had recommended the re-appointment and remuneration of Mr. Vijay Agarwal (DIN:00057634), as Chairman & Managing Director, Mrs. Mona Agarwal (DIN:00057653), as Executive Director and Mr. Sorab Agarwal (DIN:00057666) as Executive Director for a further period of 5 years w.e.f. October 1, 2018, subject to the approval of the shareholders in the ensuing Annual General Meeting. Their appointment is appropriate and in the best interest of the Company.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-secti on (6) of Section 149 of the Act and under Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "the Listing Regulations").
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remunerati on policy for directors, key managerial personnel and other employees is annexed as Annexure-2 and forms an integral part of this Report.
The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed under the Listing Regulations is given in the Annexure to the Notice of the 24th AGM.
Your Directors recommend the appointment/ reappointment of the above said Directors at the ensuing AGM.
During the year, none of the Directors of the Company have resigned from the post of Directorship of the Company.
KEY MANAGERIAL PERSONNELS (KMP)
Pursuant to the provisions of Section 203 of the Companies Act, 2013 read with Rules made thereunder following are designated as Key Managerial Personnel (KMP) of the Company:
- Mr. Vijay Agarwal, Chairman & Managing Director;
- Mrs. Mona Agarwal, Whole-Time Director;
- Mr. Sorab Agarwal, Whole-Time Director;
- Mrs. Surbhi Garg, Whole-Time Director;
- Mr. Rajan Luthra, Chief Financial Officer (CFO) and
- Mr. Anil Kumar, Company Secretary & Compliance Officer
During the year, Mr. Anil Kumar has been appointed as Company Secretary and Compliance officer of the Company in place of Mrs. Yashika Kansal who has resigned from the post of Company Secretary and Compliance Officer.
NUMBER OF BOARD MEETINGS
During the financial year 2017-18, four (4) Board Meetings were held. For details thereof kindly refer to the Corporate Governance Report forming part of this Annual Report.
ANNUAL GENERAL MEETING
During the financial year 2017-18, 23rd Annual General Meeting of the Company was held on September 29, 2017 at 11:30 a.m. at Aravali Golf Club, New Industrial Township (NIT), Faridabad, Haryana-121001.
COMMITTEES OF THE BOARD
Detailed information on the Board and its Committees is provided in the Corporate Governance Report forming part of this Annual Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of clause (c) of Sub- secti on (3) of Secti on 134 of the Companies Act, 2013, your Directors hereby confirm that they:
i) Have followed in the preparation of Annual Accounts for the financial year 2017-18, the applicable Accounting Standards and no material departures have been made for the same;
ii) Had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;
iii) Had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventi ng and detecti ng fraud and other irregularities;
iv) Had prepared the annual accounts on a going concern basis;
v) Have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) Have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.
ANNUAL PERFORMANCE EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 (3) of Securiti es Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Independent Directors at their separate meeti ng, without participation of the Non-Independent Directors and Management have considered and evaluated the Board''s performance and performance of the Chairman and Non-Independent Directors. The Independent Directors in the said meeting have also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board.
The Board of Directors has evaluated the performance of each of the Independent Directors (without participate on of the relevant Director). The Board has carried out the annual evaluation of its own performance and that of its Directors individually. The evaluation criteria as approved by the Nomination and Remuneration Committee included various aspects of the functioning of Board such as composition, process and procedures including adequate and timely information, attendance, decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was evaluated on various parameters such as industry knowledge & experience, vision, commitment, time devoted etc. The evaluation of Independent Directors was based on aspects like participation & contribute on to the Board decisions, knowledge, experience, integrity etc.
STATUTORY AUDITORS
As per provisions of Section 139(1) of the Act, the Company has appointed M/s BRAN & Associates, Chartered Accountants (Firm Regn. No. 014544N) as Statutory Auditors for a period of 5 (Five) years in the AGM of the company held on September 29, 2017.
Statutory Auditors'' Report
The observations of Statutory Auditor in its reports on standalone and consolidated financials are self-explanatory and therefore do not call for any further comments.
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed thereunder, M/s MZ & Associates were appointed as the Secretarial Auditors of the Company to carry out the secretarial audit for the year ending March 31, 2018.
Secretarial Audit Report
A Secretarial Audit Report given by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as Annexure-3. There are no qualifications, reservations or adverse remarks made by Secretarial Auditors in their Report.
COST AUDITORS
As per Section 148 of the Companies Act, 2013, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.
Pursuant to the provisions of Section 141 read with Section 148 of the Companies Act, 2013 and Rules made thereunder, M/s Vandana Bansal & Associates, Cost Accountants (Firm registration No. 100203) was appointed as the Cost Auditor of the Company for the year ending March 31, 2018.
Cost audit report for financial year 2017-18 will be filed with the Ministry of Corporate Affairs within stipulated time period.
INTERNAL AUDIT
On the recommendati on of the Audit Committee, the Board of Directors of the Company has appointed M/s Ernst and Young LLP as Internal Auditors of the Company to audit the function and activities of the Company and to review various operations of the Company; the Company continued to implement their suggestions and recommendations to improve the control environment.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
The Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143(12) of the Companies Act, 2013, including rules made thereunder.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
ACE is an early adopter of Corporate Social Responsibility (CSR) initiatives. The Company works primarily through its trust namely ACE Emergency Response Services. The CSR Committee of the Board of Directors has been formed comprising of three directors with Chairman being Independent Director. CSR Committee has framed and formulated a CSR Policy indicating the activities to be undertaken by the Company, in accordance with schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 issued under the Act. The same has also been approved and reviewed from time to time by the Board. The CSR policy is available at the website of the Company at www.ace-cranes.com. The ACE was mandatory required to spend Rs. 35.60 lakhs on CSR activities in financial year 2017-18 whereas the Company has spent Rs. 40.00 lakhs on CSR activities which are more than the mandatory requirement. The Annual Report on CSR Activiti es, as stipulated under the Act forms an integral part of this Report and is appended as Annexure-IV.
CORPORATE GOVERNANCE
Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards.
A certificate from Practicing Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated under Schedule V of the Listing Regulations is attached in Corporate Governance Report forming part of Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under Schedule V of Securiti es Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is separately given and forms part of this Annual Report and
provides a more detailed analysis on the performance of individual businesses and their outlook.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All contracts or arrangements or transacti ons that were entered into by the Company during the financial year with related parties were on an arm''s length basis and in the ordinary course of business. During the year, the Company had not entered into any contracts or arrangements or transactions with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transaction. All Related Party Transactions have been approved by the Audit Committee and Board.
Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of section 134 of the Act read with Rule 8 of the Company (Accounts) Rules, 2014 is given as Annexure-V to this report.
DISCLOSURE ON AUDIT COMMITTEE
The Audit Committee as on March 31, 2018 comprises of the following Directors: Mr. Subhash Chander Verma (Chairman), Mr. Vijay Agarwal, Mr. Grish Narain Mehra (IAS Retd.) and Dr. Amar Singhal as Members. For more details kindly refer to the section ''Committees of the Board-Audit Committee'', in the Corporate Governance Report, which forms part of this Annual Report. All recommendations of Audit Committee were accepted by the Board of Directors.
RISK MANAGEMENT
The Company has implemented a comprehensive and fully integrated ''Enterprise Risk Management'' framework in order to anticipate, identify, measure, manage, mitigate, monitor and report the principal risks and uncertainti es that can impact its ability to achieve its strategic business objectives.
This integration is enabled by alignment of Risk Management, Internal Audit, Legal and compliance methodologies and processes in order to maximize enterprise value of the Company and ensure high value creation for our stakeholder over a period of time.
The details of the Enterprise Risk Management framework with details of the principal risks and the plans to mitigate the same are given in the ''Risk and Concerns'' section of the ''Management Discussion and Analysis Report'' which forms part of this Annual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. Such controls were tested during the financial year and no material weaknesses in the design or operation were observed. Review of the financial controls is done on an ongoing basis.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company maintains adequate internal control system and procedures commensurate with its size and nature of operations. The internal control systems are designed to provide a reasonable assurance over reliability in financial reporting, ensure appropriate authorization of transactions, safeguarding the assets of the Company and prevent misuse/ losses and legal compliances.
The internal control system includes a well-defined delegation of authority and a comprehensive Management Information System coupled with quarterly reviews of operational and financial performance, a well-structured budgeti ng process with regular monitoring of expenses and Internal audit. The Internal Audit reports are periodically reviewed by the management and the Audit Committee and necessary improvements are undertaken, if required.
WHISTLE BLOWER POLICY/ VIGIL MECHANISM
The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. The Whistle Blower Policy is available on Company''s website at www.ace-cranes.com.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
The Company has laid down sexual harassment policy pursuant to provision of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder. The objective of this policy is to provide protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and for matters connected therewith. The Company has zero tolerance on sexual harassment at workplace. During the financial year 2017-18, no complaint was received under this policy. This Policy is made available at the website of the Company at www.ace-cranes.com.
RESEARCH AND DEVELOPMENT
Your Company conti nues to invest in a comprehensive Research & Development (R&D) programme to develop a unique source of sustainable competitive advantage and build future readiness by leveraging contemporary advances in several relevant areas of science and technology and blending the same with classical concepts of product development.
The Company has dedicated R&D centres at Jajru Road, Faridabad and at Dudhola Link Road, Dudhola Village, Palwal. Both these centres have accreditations from the Ministry of Science and Technology, Govt. of India. Both the centres continuously carries out Research and Developments for developing new products and also focus on the quality of products, making them more economical, cost effective and user friendly.
REDEMPTION OF PREFERENCE SHARES
The Company has partly redeemed preference shares as per terms and conditions of redemption as per details given below:
- 15,00,000, 8% cumulative non-participating redeemable preference shares of Rs. 10 each, on January 11, 2018.
- 1,16,31,628, 8% cumulative non-participating redeemable preference shares of Rs. 10 each, on March 31, 2018.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE
There was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and Company''s operations in future.
MATERIAL CHANGES AND COMMITMENTS, IF ANY
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.
PARTICULARS OF REMUNERATION OF DIRECTORS/ KMP/ EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as ''Annexure-VI to this Report.
PUBLIC DEPOSITS
During the year, your Company did not accept any public deposits under Chapter V of the Companies Act, 2013 and as such, no amount on account of principal or interest on public deposits was outstanding as of March 31, 2018.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans, guarantees and investments under Section 186 of the Companies Act, 2013 as at the end of the financial year 201718 are provided in the notes to standalone financial statements.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under the Companies Act, 2013 is annexed as Annexure-VII and forms a part of this report.
EXTRACT OF THE ANNUAL RETURN
The extract of the Annual Return in Form No. MGT - 9 forms part of the Board''s Report and is annexed herewith as Annexure-VIII.
INVESTORS EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of Secti on 124 (5) of the Companies Act, 2013, the Company has transferred the unpaid or unclaimed dividends upto FY 2009-10 and unpaid/unclaimed Interim Dividend FY 2010-11, to the Investor Education and Protection Fund (IEPF) established by the Central Government. The Company has uploaded the details of unpaid and unclaimed dividend amounts lying with the Company as on September 29, 2017 (date of the previous Annual General Meeting) on the website of the Company at www.ace-cranes.com. The said details have also been uploaded on the website of the Ministry of Corporate Affairs and the same can be accessed at www.mca.gov.in. The due date for transfer of unpaid dividend to IEPF for subsequent years is given in the Corporate Governance Report.
Attenti on of the members is drawn to the provisions of Section 124(6) of the Act which require a Company to transfer in the name of IEPF Authority all shares in respect of which dividend has not been paid or claimed for 7 (seven) consecutive years or more. In accordance with the aforesaid provision of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, the Company has already transferred all shares in respect of which dividend declared up to FY 2009-10 and Interim Dividend FY 2010-11 which has not been paid or claimed by the members for 7 (seven) consecutive years or more, to IEPF Authority.
AWARDS AND RECOGNITIONS
Your Company continues to deliver unmatched performance amongst its peers and has been conferred with awards every year. The Company was awarded with many awards and recognition. The significate award includes:
- Best Seller in Mobile Cranes Category Award-4th Equipment India;
- "70 Most Trusted Power Brands of India" Award;
- Economic Times "Infra Focus" Award;
- India''s Most Trusted Company Award-IBC, USA;
- India''s Top Challengers Award-Construction World;
- Best Seller in Mobile Cranes Category Award-5th Equipment India;
- India''s Best Material handling & Construction Equipment Manufacturing Company Award-IBC USA.
OTHER INFORMATION
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review or said items are not applicable to the Company:
1. The Managing Director and the Whole-Time Directors has not received any remuneration or commission from any of its subsidiaries.
2. Issue of shares with differential right: Not issued.
3. Buy back of securities: No.
4. Issue of sweat equity shares: Not Issued.
5. Bonus shares: Not Issued.
6. Employees Stock option: Not Issued.
7. Business Responsibility Report: Not applicable.
8. Dividend Distribution Policy: Not applicable.
ACKNOWLEDGEMENT
The Board places on record its appreciation for the support and continued co-operation extended by all the customers, vendors, dealers, bankers, regulators and business associates. The Board places on record its appreciation to all the employees for their dedicated and committed services. Your Directors deeply acknowledge the continued trust and confidence that the shareholders place in the management and is confident that with their continued support, the Company will achieve its objectives and emerge stronger in the coming years.
For and on behalf of the Board of
Action Construction Equipment Limited
Sd/-
Vijay Agarwal
Chairman & Managing Director
DIN:00057634
Place: New Delhi
Dated: May 21, 2018
Mar 31, 2017
Dear Members,
The Directors are pleased to present the 23rd Annual Report on the business and operation of the Company together with Audited Statement of Accounts for the financial year ended March 31,2017.
(Rs. in Lakh)
FINANCIAL RESULTS |
2016-17 |
2015-16 |
Gross Turnover |
77,551 |
65,005 |
Excise Duty |
4,603 |
3,616 |
Net Turnover |
72,948 |
61,389 |
Operating and Other Income |
2,821 |
3,288 |
Total Income |
75,769 |
64,677 |
Profit before Depreciation, Interest and Tax |
5,018 |
4,043 |
Less: |
||
Depreciation |
1,254 |
1135 |
Interest |
1,305 |
1401 |
Provision forTaxation |
495 |
626 |
Net Profit after Tax |
1,964 |
881 |
Profit brought forward |
6,241 |
4,894 |
Balance of Amalgamating Company |
- |
918 |
Profit available for Appropriation |
8,205 |
6,693 |
Appropriations: |
||
Dividend |
594 |
209 |
Corporate Tax on Dividend |
121 |
43 |
Amount transferred to General Reserve |
200 |
200 |
Profit carried to Balance Sheet |
7290 |
6,241 |
FINANCIAL PERFORMANCE
During the financial year under review, on a standalone basis, your Company has achieved gross turnover of Rs.77,551 lakh as compared to Rs.65,005 lakh in the previous year, thereby registering a growth of 19.30%. The profit before depreciation, interest and tax stood at Rs. 5,018 lakh in the year 2016-17, as against Rs. 4,043 lakh in the previous year, representing a growth of 24.12%.
The profit after tax is Rs.1,964 lakh in the year 2016-17 as against Rs. 881 lakh in the previous year i.e. an increase of 123%.
The Company could achieve such a growth and performance due to tighter operating controls, prudent raw material sourcing, new customer addition and controlled overheads. Your Company has taken several steps to reduce the cost and increase its market share in all products.
STATE OF COMPANYâS AFFAIRS
The financial year 2016-17 embarked upon visible improvement in operating margins due to focused cost efficiency measures, price discipline and low commodity prices. During the year, we introduced smart features in our existing product range that not only helped us to increase our market share but also adhere to our core philosophy of providing customised solutions to our customers. ACE realigned its focus on domestic markets and growth. ACE sustained its investment in brand and manpower to prepare for next growth phase. The Company continues to invest in future technology, products and people. The Company is ready for next phase of growth.
AMOUNTSTRANSFERREDTO RESERVES
Your Company proposes to transfer Rs. 200.00 Lakh to the general reserve out of the amount available for appropriation.
DIVIDEND
The Board has recommended the dividend of 8% on Preference Share Capital of the Company which will result in an outflow of Rs. 290.97 lakh (including Corporate Dividend Tax of Rs. 49.22 lakh).
The Board has recommended a final dividend of Rs. 0.30 i.e (15%) per equity share for the financial year ended March 31, 2017, which will result in an outflow of Rs. 423.62 lakh (including Corporate Dividend Tax of Rs. 71.65 lakh).
The payment of dividends are subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company.
CHANGE INTHE NATURE OF BUSINESS, IF ANY
There is no change in the business of the Company during the financial year ended March 31,2017.
MATERIAL CHANGES AND COMMITMENTS, IF ANY
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has a wholly Owned Subsidiary and a Fellow Subsidiary as on March 31,2017, namely:
1. Frested Limited, Cyprus-wholly Owned Subsidiary
2. SC Forma SA, Romania - Fellow Subsidiary
There has been no material change in the nature of the business of the subsidiaries.
In accordance with section 129(3) of the Companies Act, 2013 and Accounting Standard (AS) - 21 on Consolidated Financial Statements, the Company has prepared consolidated financial statements of the Company and all its subsidiaries, which form part of this Annual Report.
Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient feature of the financial statement/Highlights of performance of a companyâs subsidiary or subsidiaries, is given in the prescribed form AOC-1 as Annexure-I to this report.
The Policy for determining material subsidiaries may be accessed on the Companyâs website viz www.ace-cranes.com.
BOARD OF DIRECTORS
The Board consists of executive and non-executive directors those have wide and varied experience in different disciplines of corporate functioning.
Mrs. Surbhi Garg (DIN:01558782) has been reappointed as Whole Time Director (Executive Director) of the Company by the Board in their meeting held on May 19, 2016 duly approved by the members of the Company in their Annual General Meeting held on September 23, 2016 for a period of three (3) years with effect from April 1,2017.
In accordance with Article 88(1) of the Articles of Association of the Company, Mr. Sorab Agarwal (DIN : 00057666) will be liable to retire by rotation in ensuing Annual General Meeting and being eligible offer himself for re-appointment at the forthcoming AGM.
The Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year.
During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees for the purpose of attending meetings of the Company.
None of the Directors of the Company is disqualified under Section 164(2) of the Companies Act, 2013 and Rules made there under.
KEY MANAGERIAL PERSONNELS
Pursuant to the Provisions of Section 203 of the Companies Act, 2013, Mr. Vijay Agarwal, Chairman & Managing Director, Mrs. Mona Agarwal, Mr. Sorab Agarwal & Mrs. Surbhi Garg, Whole-Time Directors, Mr. Rajan Luthra, CFO and Mrs. Yashika, Company Secretary are designated as Key Managerial Personnel of the Company.
ANNUAL GENERAL MEETING
During the Financial Year 2016-17, 22nd Annual General Meeting of the Company was held on September 23, 2016 at 11:00a.m. atAravali Golf Club, New Industrial Township (NIT), Faridabad, Haryana-121001.
ATTRIBUTES, QUALIFICATIONS, INDEPENDENCE AND REMUNERATION OF DIRECTORS AND THEIR APPOINTMENT
The criteria for determining qualifications, positive attributes and independence in terms of Act and the Rules thereunder, both in respect of independent and the other Directors as applicable, has been approved by the Nomination and Remuneration Committee. The Board is well diversified and have balance of skills, experience and diversity of perspectives appropriates to the Company.
Directors are appointed / re-appointed with the approval of the Members for a period of three to five years or a shorter duration. All directors, other than independent directors and Managing Director, are liable to retire by rotation, unless approved by the members. One-third of the Directors who are liable to retire by rotation, retire every year and are eligible for re-election.
Sitting fee of independent directors for attending the board meetings and other committee meeting has been increased from Rs.10,000/- (Rupees Ten Thousand only) to Rs.15,000/-(Rupees Fifteen Thousand only) per meeting with effect from February 7, 2017 as decided by Board of directors of the Company.
The Companyâs policy relating to remuneration of Directors, key managerial personnel and other employee is displayed on the website of the Company at www.ace-cranes.com and is provided as Annexure -II to this Report.
COMMITTEES OFTHE BOARD
Detailed information on the Board and its Committees is provided in the Report on Corporate Governance forming part of this Annual Report.
NUMBEROF BOARD MEETINGS
Five meetings of the Board were held during the year. For details of the meetings of the board, please refer to the Corporate Governance Report, forming part of this Annual Report.
DIRECTORSâ RESPONSIBILITYSTATEMENT
Pursuant to the provisions of clause (c) of Sub- section (3) of Section 134 of the Companies Act, 2013, your Directors hereby confirm that they:
i) Have followed in the preparation of Annual Accounts for the financial year 2016-17, the applicable Accounting Standards and no material departures have been made for the same;
ii) Had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit of the Company for the year ended on that date;
iii) Had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) Had prepared the annual accounts on a going concern basis;
v) Have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) Have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under Schedule V of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is separately given and forms part of this Annual Report and provides a more detailed analysis on the performance of individual businesses and their outlook.
REPORT ON CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under Part C of Schedule V of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 from a Practicing Company Secretary confirming compliance of the conditions of corporate governance is attached to the Report on Corporate Governance.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTY
All contracts or arrangements or transactions that were entered into by the Company during the financial year with related parties were on an armâs length basis and in the ordinary course of business. During the year, the Company had not entered into any contracts or arrangements or transactions with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transaction. All Related Party Transactions have been approved by the Audit Committee.
The policy on Related Party Transactions as adopted by the Board is available on website of the Company viz www.ace-cranes.com.
Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of section 134 of the Act read with Rule 8 of the Company (Accounts) Rules, 2014 is given as Annexure-lll to this report.
CORPORATE SOCIAL RESPONSIBILITY(CSR)
ACE has been an early adopter of Corporate Social Responsibility (CSR) initiatives. The Company works primarily through its trust namely ACE Emergency Response Services.
The CSR Committee of the Board of Directors has been formed comprising of three directors with Chairman being Independent Director. CSR Committee has framed and formulated a CSR Policy indicating the activities to be undertaken by the Company, in accordance with schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 issued under the Act. The same has also been approved and reviewed time to time by the Board. The CSR policy is available at the website of the Company viz www.ace-cranes.com. The ACE was mandatory required to spend Rs. 22.70 lakh on CSR activities in financial year 2016-17 whereas the Company has spent Rs. 100.00 lakh on CSR activities which are more than the mandatory requirement. The Annual Report on CSR Activities, as stipulated under the Act forms an integral part of this Report and is appended as Annexure-IV.
RISK MANAGEMENT
The Company has implemented a comprehensive and fully integrated âEnterprise Risk Managementâ framework in order to anticipate, identify, measure, manage, mitigate, monitor and report the principal risks and uncertainties that can impact its ability to achieve its strategic business objectives.
This integration is enabled by alignment of Risk Management, Internal Audit, Legal and compliance methodologies and processes in order to maximize enterprise value of the Company and ensure high value creation for our stakeholder over a period of time.
The details of the Enterprise Risk Management framework with details of the principal risks and the plans to mitigate the same are given in the âRisk and Concernâ section of the âManagement Discussion and Analysis Reportâ which forms part of this Annual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. Such controls were tested during the financial year and no material weaknesses in the design or operation were observed. Review of the financial controls is done on an ongoing basis.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has a Whistle Blower Policy (the âWB Policyâ) with a view to provide vigil mechanism to Directors, employees and other stakeholders to disclose instances of wrong doing in the workplace and report instances of unethical behavior, actual or suspected fraud or violation of the Companyâs code of conduct or ethics policy. The Policy provides that the Company investigates such incidents, when reported, in an impartial manner and takes appropriate action. The WB Policy also provides mechanism for adequate safeguards against victimization of Director(s)/ Employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower Policy has been posted on the website of the Company and the details of the same are explained in the Report on Corporate Governance forming part of this Annual Report. The Whistle Blower Policy is available at the website of the Companyvizwww.ace-cranes.com.
SEXUAL HARASSMENT POLICY
The Company has laid down sexual harassment policy pursuant to provision of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The objective of this policy is to provide protection against sexual harassment of women at workplace and for the prevention and redressal of complaints of sexual harassment and for matters connected therewith. The Company has zero tolerance on sexual harassment at workplace. During the financial year 2016-17, no complaint was received under this policy. This policy is made available at the website of the Companyvizwww.ace-cranes.com.
RESEARCH AND DEVELOPMENT
Your Company continues to invest in a comprehensive Research & Development (R&D) programme to develop a unique source of sustainable competitive advantage and build future readiness by leveraging contemporary advances in several relevant areas of science and technology and blending the same with classical concepts of product development.
The Company has dedicated R&D centres at Jajru Road, Faridabad and at Dudhola Link Road, Dudhola Village, Palwal. Both these centres have accreditations from the Ministry of Science and Technology, Govt, of India. Both the centres continuously carries out Research and Developments for developing new products and also focus on the quality of products, making them more economical, cost effective and user friendly.
STATUTORY AUDITORS AND AUDITORâS REPORT
M/s Rajan Chhabra & Co. Chartered Accountants, Statutory Auditor of the Company were appointed in the 20th Annual General Meeting to hold office until the conclusion of 23rd Annual General Meeting.
As per Companies Act, 2013 (âThe Actâ) and rules made thereunder. M/s Rajan Chhabra & Co have completed their term and are not eligible for re-appointment. Based on recommendation of Audit Committee, your company seeks approval for the appointment of M/s BRAN & Associates, Chartered Accountants (Firm Registration No. 014544N) as the statutory auditors of the Company to hold office for a period of five consecutive years from the conclusion of this Annual General Meeting of the Company till the conclusion of the 28th Annual General Meeting to be held in the calendar year2022.
There is no qualification or reservation or remarks made by the Auditors in their Report. The Notes on Financial Statements referred to in the Auditors report are self-explanatory and do not require any further comments.
COST AUDITORS
In terms of the provisions of Section 148 read with Companies (Cost Record and Audit) Rules, 2014, and other applicable provisions, if any of the Companies Act, 2013, the Board has appointed M/s Vandana Bansal & Associates, Cost Accountants (Firm registration No. 100203) as cost auditors of Company for the financial year 2016-17 to conduct audit of the cost records of the Company. Cost audit report for financial year 2016-17 will be filed with the Ministry of Corporate Affairs within stipulated time period.
Further, as per the provisions of the Companies Act, 2013, the Board of Directors of your Company on the recommendations of the Audit Committee has appointed M/s. Vandana Bansal & Associates, Cost Accountants as the Cost Auditor for the financial year 2017-18. The remuneration proposed to be paid to cost auditor requires ratification of the shareholders of the Company, in view of this, your ratification for payment of remuneration to Cost Auditors is being sought at the ensuing AGM.
SECRETARIAL AUDITOR AND REPORT
In terms of Section 204 of the Companies Act, 2013 and Rules made there under. M/s MZ & Associates, Practicing Company Secretary was appointed to conduct the Secretarial Audit of the Company for the financial year 2016-17. The Secretarial Audit Report is annexed to this Report as Annexure V.
The report is self-explanatory and do not call for any further comments. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
PARTICULARS OF THE EMPLOYEES AND RELATED DISCLOSURES
The total number of permanent employees as on March 31, 2017 stood at 1014 employees as compared to 1062 as on March 31,2016.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report and are annexed as Annexure-VI.
PUBLIC DEPOSITS
During the year, your Company did not accepted any public deposits under Chapter V of the Companies Act, 2013 and as such, no amount on account of principal or interest on public deposits was outstanding as of March 31,2017.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to standalone financial statements.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under the Companies Act, 2013 is annexed as Annexure-VII and forms a part of this report.
EXTRACT OF ANNUAL RETURN
In accordance with section 134(3)(a) of the Companies Act, 2013, the extract of Annual return pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014 in form MGT-9 is annexed herewith as Annexure -VIII and forms a part of this report.
FORMAL ANNUAL PERFORMANCE EVALUATION OF THE BOARD AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 (3) of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 Independent Directors at their separate meeting, without participation of the Non-Independent Directors and Management have considered and evaluated the Boardâs performance and performance of the Chairman and Non-Independent Directors. The Independent Directors in the said meeting have also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board.
The Board of Directors has evaluated the performance of each of Independent Directors (without participation of the relevant Director). The Board has carried out the annual evaluation of its own performance and that of its Directors individually. The evaluation criteria as approved by the Nomination and Remuneration Committee included various aspects of the functioning of Board such as composition, process and procedures including adequate and timely information, attendance, decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was evaluated on various parameters such as industry knowledge & experience, vision, commitment, time devoted etc. The evaluation of Independent Directors was based on aspects like participation & contribution to the Board decisions, knowledge, experience, integrity etc.
OTHER INFORMATION
Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters in the financial year 2016-17:
1. Issue of shares with differential rights: Not issued
2. Buy back of securities :No
3. Issue of sweat equity shares: Not issued
4. Bonus shares: Not issued
5. Employees stock option: Not issued
6. The Managing Director and the Whole-time Directors does not receive any remuneration or commission from any of its subsidiaries.
7. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Companyâs operations in future.
ACKNOWLEDGEMENTS
The Board places on record its appreciation for the support and continued co-operation extended by all the customers, vendors, dealers, bankers, regulators and business associates. The Board places on record its appreciation to all the employees for their dedicated and committed services. Your Directors deeply acknowledge the continued trust and confidence that the shareholder place in the management and is confident that with their continued support, the Company will achieve its objectives and emerge stronger in the coming years.
For and on behalf of the Board of
Action Construction Equipment Limited
Sd/
Vijay Agarwal
Chairman & Managing Director
DIN :00057634
Place : New Delhi
Dated: May 19, 2017
Mar 31, 2016
The Directors are pleased to present the 22nd Annual report and Audited Statement of Accounts for the financial year ended 31st March, 2016.
(Rs. in lacs)
FINANCIAL RESULTS |
2015-16 |
2014-15 |
Gross Turnover |
65,005 |
61,681 |
Excise Duty |
3,616 |
2,885 |
Net Turnover |
61,389 |
58,796 |
Operating and Other Income |
3,288 |
2,089 |
Total Income |
64,677 |
60,885 |
Profit before Depreciation, Interest and Tax |
4043 |
3,215 |
Less: |
||
Depreciation |
1135 |
957 |
Interest |
1401 |
1,301 |
Provision for Taxation |
626 |
282 |
Net Profit after Tax |
881 |
675 |
Profit brought forward |
4,894 |
4657 |
Balance of Amalgamating Company |
918 |
- |
Profit available for Appropriation |
6,693 |
5,332 |
Appropriations: |
||
Dividend |
209 |
198 |
Corporate Tax on Dividend |
43 |
40 |
Amount transferred to General Reserve |
200 |
200 |
Profit carried to Balance Sheet |
6,241 |
4,894 |
FINANCIAL PERFORMANCE
During the financial year under review, on a standalone basis, Your Company''s achieved gross turnover of Rs. 65,005 lacs as compared to Rs. 61,681 lacs in the previous year, thereby registering a growth of 5.39 %. The profit before depreciation, interest and tax stood at Rs 4043 lacs in the year 2015-16, as against Rs. 3,215 lacs in the year 2014-15, representing a growth of 25.75%.
The profit after tax is Rs. 881 lacs in the year 2015-16 as against Rs, 675 lacs in the previous year i.e. an increase of 30.51 %.
The Company could achieve such a growth and performance due to tighter operating controls, prudent raw material sourcing, new customer addition and controlled overheads.
Your company has taken several steps to reduce cost and increase its market share in all products.
STATE OF COMPANYâS AFFAIRS
The financial year 2015-16 embarked upon visible improvement in operating margins due to focused cost efficiency measures, price discipline and low commodity prices.
During the year, we launched new products like skid loaders, wheel based harvesters and introduced smart features in our existing product range that not only helped us to increase our market share but also adhere to our core philosophy of providing customized solutions to our customers. ACE realigned its focus on domestic markets and growth. ACE sustained its investment in brand and manpower to prepare for next growth phase. The Company continues to invest in future technology, products and people. The Company is ready for next phase of growth.
We were awarded best seller in mobile cranes category by Equipment India at 3rd Equipment Award, 2016.
RESERVES
Your Company proposes to carry Rs 200 lacs to the general reserve and retain Rs. 880.89 lacs in the profit and loss account.
DIVIDEND
At the meeting of Board of Directors held on 15th March, 2016, the Directors approved the payment of Interim Dividend of 10 % on the equity share capital for FY 2015-16, resulting in an outflow of Rs 237.44 lacs (Including Corporate Dividend Tax of Rs. 39.56 lacs). Since the Company has paid interim dividend to the equity shareholders for the financial year 2015-16 and in order to conserve the resources of the Company and to build up reserves, the Directors has not recommended any final dividend on Equity Shares Capital of the Company.
Directors have recommended dividend of 8% on Preference Share Capital of the Company on the pro data basis from the allotment date till March 31, 2016, which will result in an outflow of Rs. 14.24 lacs (including Corporate Dividend Tax of Rs. 3.01 Lacs).
The payment of dividend is subject to the approval of the shareholders at the ensuing annual general meeting of the Company.
MATERIAL CHANGES AND COMMITMENTS, IF ANY
No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relate and the date of this report.
ISSUE OF SECURTIES
In pursuance of the Scheme of amalgamation ("the Scheme") sanctioned by the Hon''ble High Court of Punjab and Haryana vide its order dated 17th Nov, 2015,1,83,83,000 equity shares and 3,02,19,380 preference shares of the Company were issued on 15th March, 2016 to the shareholders of ACE TC Rentals Private Limited in ratio of 1168 fully paid up equity shares of Rs. 2/- each of the ACE for every 100 fully paid up equity shares of Rs.10/- each of ACE TC Rentals Private Limited (the Transferor Company) held by the Members whose names appear in the Register of Members of the transferor company such that the equity shareholding of the Members in the ACE is increased only up to five percent of the post issue paid-up equity share capital of the ACE. As a result of this, the issued, subscribed and paid up share capital of the Company has increased from Rs. 1978.80 lacs in FY 2014-15 to Rs. 5368.40 lacs in FY 2015-16. The Authorized share capital of the Company has also increased from Rs. 2450.00 lacs in FY2014-15 to Rs. 5525.00 lacs in FY 2015-16.
The entire business, assets, liabilities, duties and obligations of ACE TC Rentals Pvt. Limited were transferred to and vested in the Company with effect from the appointed date i.e. April 1, 2014.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has a Wholly Owned Subsidiary and a Fellow Subsidiary, at the end of the current financial year ended on 31 st March, 2016, namely:
1. Forested Limited, Cyprus- Wholly Owned Subsidiary
2. SC Forma SA, Romania - Fellow Subsidiary
There has been no material change in the nature of the business of the subsidiaries.
In accordance with section 129(3) of the Companies Act, 2013 and Accounting Standard (AS)-21 on Consolidated Financial Statements, the Company has prepared consolidated financial statements of the Company and all its subsidiaries, which form part of this Annual Report.
A report on the performance and financial performance of the Subsidiary and associate Companies as per Companies Act, 2013 is provided in the prescribed form AOC -1 as Annexure-I to this report.
The Policy for determining material subsidiaries may be accessed on the Company''s website viz www.ace-cranes.com.
BOARD OF DIRECTORS
Pursuant to the provisions of section 149 of the Companies Act, 2013, Mr. Girish Narain Mehra (DIN: 00059311), Mr. Subhash Chander Verma (Din: 00098019), Mr. Keshav Chander Agrawal (Din: 00098143) and Dr. Amar Singal (Din: 00035903) were appointed as independent directors at annual general meeting of the Company held on September 25,2015.
The Independent Directors of the Company have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year.
In accordance with Article 88(1) of the Articles of Association of the Company, Mrs. Surbhi Garg retires by rotation in ensuing Annual General Meeting and being eligible offer herself for re-appointment at the forthcoming AGM.
During the year, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees for the purpose of attending meetings of the Company.
None of the Directors of your Company is disqualified as per provisions of the Companies Act, 2013.
ATTRIBUTES, QUALIFICATIONS, INDEPENDENCE AND REMUNERATION OF DIRECTORS AND THEIR APPOINTMENT
The criteria for determining qualifications, positive attributes and independence in terms of Act and the Rules there under, both in respect of independent and the other Directors as applicable has been approved by the Nomination and Remuneration Committee. The Board is well diversified and have balance of skills, experience and diversity of perspectives appropriates to the Company.
Directors are appointed / re-appointed with the approval of the Members for a period of three to five years or a shorter duration. All directors, other than independent directors and Managing Director, are liable to retire by rotation, unless approved by the members. One-third of the Directors who are liable to retire by rotation, retire every year and are eligible for re-election.
The Company''s policy relating to remuneration of Directors, key managerial personnel and other employee is displayed on the website of the Company at www.ace-cranes.com and is provided as Annexure -II to this Report.
KEY MANAGERIAL PERSONNELS
Pursuant to the Provisions of Section 203 of the Companies Act, 2013, Mr. Vijay Agarwal, Chairman & Managing Director, Mrs. Mona Agrawal , Mr. Sorab Agarwal & Mrs. Surbhi Garg, WholeTime Director, Mr. Rajan Luthra, CFO and Mrs. Yashika Kansal, Company Secretary are designated as Key Managerial Personnel of the Company.
Further, Mr. R.S. Jhanwer, Head - Corporate Affairs & Company Secretary resigned w.e.f. 11th January, 2016 and Mrs. Yashika has been appointed as Company Secretary 8< Compliance Officer w.e.f. 06th February, 2016.
COMMITTEES OF THE BOARD
Detailed information on the Board and its Committees is provided in the Report on Corporate Governance forming part of this Annual Report.
NUMBER OF MEETINGS
Five meetings of the Board were held during the year. For details of the meetings of the board, please refer to the Corporate Governance report which forms part of this report.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Companies Act, 2013, your Directors hereby confirm that they:
i) Have followed in the preparation of Annual Accounts for the financial year 2015-16, the applicable Accounting Standards and no material departures have been made for the same;
ii) Had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31 st March, 2016 and of the profit of the Company for the year ended on that date;
iii) Had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) Had prepared the annual accounts on a going concern basis;
v) The directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
vi) The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under Schedule V of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is separately given and forms part of this Annual Report and provides a more detailed analysis on the performance of individual businesses and their outlook.
REPORT ON CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate Governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under Part C of Schedule V of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 from a Practicing Company Secretary confirming compliance of the conditions of corporate governance is attached to the Report on Corporate Governance.
RELATED PARTY TRANSACTIONS
All contracts or arrangements or transactions that were entered into by the Company during the financial year with related parties were on arm''s length basis and in the ordinary course of business. During the year, the Company had not entered into any contracts or arrangements or transactions with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transaction. All Related Party Transactions have been approved by the Audit Committee.
The policy on Related Party Transactions as adopted by the Board is available on website of the Company viz www.ace-cranes.com.
Further, the prescribed details of related party transactions of the Company in Form No. AOC-2, in terms of section 134 of the Act read with Rule 8 of the Company (Accounts) Rules, 2014 is given as Annexure -III to this report.
CORPORATE SOCIAL RESPONSIBILITY
ACE has been an early adopter of Corporate Social Responsibility (CSR) initiatives. The Company works primarily through its trust namely ACE Emergency Response Services.
The CSR Committee of the Board of Directors has been formed comprising of three directors with Chairman being independent Director. CSR Committee has framed and formulated a CSR Policy indicating the activities to be undertaken by the Company, in accordance with schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014 issued under the Act. The same has also been approved by the Board. The CSR policy is available at the website of the Company viz www.ace-cranes.com. The Companies are required to spend at least 2 % of the average net profits of their three immediately preceding financial years on CSR related activities. Accordingly, the Company was required to spend Rs. 21.78 lacs on CSR activities whereas the Company has spent Rs. 156.72 Lacs on CSR activities which is more than the mandatory requirement. The Annual Report on CSR Activities, as stipulated under the Act forms an integral part of this Report and is appended as Annexure-IV
RISK MANAGEMENT
The Company has implemented a comprehensive and fully integrated ''Enterprise Risk Management'' framework in order to anticipate, identify, measure, manage, mitigate, monitor and report the principal risks and uncertainties that can impact its ability to achieve its strategic business objectives.
This integration is enabled by alignment of Risk Management, Internal Audit, Legal and compliance methodologies and processes in order to maximize enterprise value of the
Company and ensure high value creation for our stakeholder over a period of time.
The details of the Enterprise Risk Management framework with details of the principal risks and the plans to mitigate the same are given in the ''Risk Management Reportâ section of the ''Management Discussion and Analysis Report'' which forms part of this Annual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. Such controls were tested during the financial year and no material weaknesses in the design or operation were observed. Review of the financial controls is done on an ongoing basis.
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has a Whistle Blower Policy (the "WB Policy") with a view to provide vigil mechanism to Directors, employees and other stakeholders to disclose instances of wrongdoing in the workplace and report instances of unethical behavior, actual or suspected fraud or violation of the Company''s code of conduct or ethics policy. The Policy provides that the Company investigates such incidents, when reported, in an impartial manner and takes appropriate action. The WB Policy also provides mechanism for adequate safeguards against victimization of Director(s)/ Employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower Policy has been posted on the website of the Company and the details of the same are explained in the Report on Corporate Governance forming part of this Annual Report. The Whistle Blower Policy is available at the website of the Company viz, www.ace-cranes.com.
RESEARCH AND DEVELOPMENT
Your Company continues to invest in a comprehensive Research & Development (R&D) programmed to develop a unique source of sustainable competitive advantage and build future readiness by leveraging contemporary advances in several relevant areas of science and technology and blending the same with classical concepts of product development.
The Company has dedicated R&D centres at Jajru Road, Faridabad and at Dudhola Link Road, Dudhola Village, Palwal. Both these centres have accreditations from the Ministry of Science and Technology, Govt, of India. Both the centres continuously carries out Research and developments for developing new products and also focus on the quality of products, making them more economical, cost effective and user friendly.
STATUTORY AUDITORS AND AUDITOR''S REPORT
At the Annual General Meeting held on 31st July, 2014, M/s. Rajan Chhabra & Co., Chartered Accountants, were appointed as the Statutory Auditors of the Company to hold the office till the conclusion of the Annual General Meeting to be held in the Calendar year, 2017.
In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s Rajan Chhabra & Co., Chartered Accountants, as statutory auditors of the Company is placed for ratification by the shareholders. Your Company has received confirmation from the above mentioned firm regarding consent and eligibility under Sections(s) 139 & 141 of the Companies Act, 2013 read with Company (Accounts) Rules, 2014. As required under Regulation 33 (1) (d) of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Auditor has also confirmed that they hold a valid certificate issued by ICAI.
The Auditors'' Report does not contain any qualification, reservation or adverse remarks. The Notes on Financial Statements referred to in the Auditors report are self-explanatory and do not require any further comments.
COST AUDITORS
The Board has appointed M/s Vandana Bansal and Associates, Cost accountant (Firm registration No. 100203) as cost auditors of your Company for financial year 2015-16 to conduct audit of the cost records of the Company. Cost audit report for financial year 2015-16 will be filed with the Ministry of Corpo rate Aff a i rs.
As per section 148 of the Companies Act, 2013 and Rules made there under, the board of director of your Company on the recommendation of the Audit Committee has appointed M/s Vandana Bansal and Associates, Cost Accountant as the Cost Auditor of the Company for the financial year 2016-17.
Your Company has received consent from M/s Vandana Bansal and Associates, Cost Accountant to act as Cost Auditor of your Company for financial year 2016-17 along with the certificate confirming their independence.
SECRETARIAL AUDITOR
Savita Trehan & Associates, Practicing Company Secretary was appointed to conduct the Secretarial Audit of the Company for the financial year 2015-16, as required under Section 204 of the Companies Act, 2013 and Rules made there under. The Secretarial Audit Report is annexed to this Report as Annexure V. There is no qualification, reservation or adverse remark(s) in the Secretarial Audit Report.
DISCLOSURES
PARTICULARS OF THE EMPLOYEES AND RELATED DISCLOSURES:
The total number of permanent employees as on 31 st March, 2016 stood at 1062 employees as compared to 975 as on March 31,2015.
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report and are annexed as Annexure VI.
There are no employees who are drawing remuneration in excess of the limits as set out in provisions of Section 197(12) of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
PUBLIC DEPOSITS
During the year, your Company has not accepted any deposits under Section 73 of the Companies Act, 2013 and as such, no amount on account of principal or interest on public deposits was outstanding as on March 31 st, 2016.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 are provided in the notes to standalone financial statements.
EMPLOYEES STOCK OPTION SCHEME
During the year under review, the Company has not allotted any shares under Employees Stock Option Scheme (ESOS) and hence no disclosure is required to be made in compliance with Clause 12 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Regulations, 1999.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption and foreign exchange earnings and outgo, as required to be disclosed under the Companies Act, 2013 is annexed herewith as Annexure - VII and forms an integral parts of this report.
EXTRACT AS ANNEXURE OF ANNUAL RETURN
Extract of the Annual Return in Form MGT- 9 is annexed herewith as Annexure - VIII and forms an integral part of this report.
FORMAL ANNUAL PERFORMANCE EVALUATION OF THE BOARD AND THAT OF ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Regulation 25 (3) of Securities Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 Independent Directors at their separate meeting, without participation of the Non-Independent Directors and Management have considered and evaluated the Board''s performance and performance of the Chairman and Non-independent Directors. The Independent Directors in the said meeting have also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board.
The Board of Directors has evaluated the performance of each of Independent Directors (without participation of the relevant Director). The Board has carried out the annual evaluation of its own performance and that of its Directors individually. The evaluation criteria as approved by the Nomination and Remuneration Committee included various aspects of the functioning of Board such as composition, process and procedures including adequate and timely information, attendance, decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was evaluated on various parameters such as industry knowledge & experience, vision, commitment, time devoted etc. The evaluation of Independent Directors was based on aspects like participation & contribution to the Board decisions, knowledge, experience, integrity etc.
OTHER INFORMATION
Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters in the financial year 2015-16:
1. Issue of equity shares with differential rights as to dividend, voting or otherwise.
2. The Managing Director and the Whole-time Directors does not receive any remuneration or commission from any of its subsidiaries.
3. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and the Company''s operations in future.
ACKNOWLEDGEMENTS
The Board places on record its appreciation for the support and continued co-operation extended by all the customers, vendors, dealers, bankers, regulators and business associates. The Board places on record its appreciation to all the employees for their dedicated and committed services. Your Directors deeply acknowledge the continued trust and confidence that the Shareholder place in the management and is confident that with their continued support, the Company will achieve its objectives and emerge stronger in the coming years.
For and on behalf of the Board of Action Construction Equipment Ltd
Vijay Agarwal Chairman & Managing Director
Place: New Delhi Dated: 19th May, 2016
Mar 31, 2015
Dear Members,
The Directors are pleased to present the 21st Annual Report and Audited
Statement of Accounts for the financial year ended 31st March, 2015.
(Rs. in lacs)
FINANCIAL RESULTS 2014-15 2013-14
Gross Turnover 61,681 64,252
Excise Duty 2,885 3,364
Net Turnover 58,796 60,888
Operating and Other Income 2,089 1,271
Total Income 60,885 62,159
Profit before Depreciation
Interest and Tax 3,215 3,080
Less:
Depreciation 957 1,527
Interest 1,301 1,041
Provision for Taxation 282 109
Net Profit after Tax 675 403
Profit brought forward 4657 4,470
Profit available for
Appropriation 5,332 4,873
Appropriations:
Dividend 198 99
Corporate Tax on Dividend 40 17
Amount transferred to General
Reserve 200 100
Profit carried to Balance Sheet 4894 4657
FINANCIAL PERFORMANCE
Indian economy witnessed another challenging year with nil/ negative
economic growth in the Industries where we operate in the financial
year 2014-15. The sluggishness in economy, policy inertia and
lacklustre infrastructure projects have all impacted the Indian economy
as well as your Company.
Despite these tough conditions. Your Company delivered another year of
steady performance.
Your Company's gross turnover stood at Rs. 61,681 lacs in the year
2014-15, as compared to Rs. 64,252 lacs in the year 2013-14. The profit
before depreciation, interest and tax stood at Rs. 3,215 lacs in in the
year 2014-15, as against Rs. 3,080 lacs in theyear2013-14.
The profit after tax is Rs. 675 lacs in the year 2014-15 as against Rs,
403 lacs in the previous year i.e. an increase of 67.50 %. Your company
has taken several steps to reduce cost and increase its market share in
all products.
DIVIDEND
Your Directors are pleased to recommend 10% Dividend per Equity share
on the Paid up Equity Share Capital of the Company for the year
2014-15. Total dividend (including dividend tax) will absorb Rs. 238
lacs out of the profits available for the year 2014-15. The payment of
dividend is subject to the approval of the shareholders at the ensuing
Annual General Meeting of the Company.
INCREASE IN SHARE CAPITAL
Your Company has increased the Authorized Share Capital of the Company
from Rs. 24,50,00,000/- (Rupees Twenty Four Crore Fifty Lacs) divided
into 12,25,00,000 (Twelve Crore Twenty Five Lacs) Equity Shares of Rs.
2/- (Rupees Two) each to Rs. 50,25,00,000/- (Rupees Fifty Crore Twenty
Five Lacs Only) on 8th May, 2015 . The increased authorised share
capital was restructured to 10,00,00,000 (Ten Crore) Equity Shares of
Rs. 2/- (Rupees Two) each and 3,02,50,000 (Three Crore Two Lacs Fifty
Thousand) 8% Redeemable Cumulative Preference Shares of Rs. 10/-
(Rupees Ten) each to enable the Company to allot shares, once the
scheme becomes effective after all approvals, as proposed in the Scheme
of Amalgamation between ACE TC Rentals Private Limited and your Company
filed with the Hon'ble High Court of Punjab and Haryana.
CORPORATE DEVELOPMENT - MERGER
ACE TC Rentals Private Limited is proposed to be merged with the
Company with effect from April 1, 2014 pursuant to a scheme of
amalgamation ("the scheme"). The scheme has been filed in the High
Court for the States of Punjab and Haryana. Once the Scheme is approved
and becomes effective, which is expected to be effective in this
financial year, the Company will issue 1,84,90,500 equity shares of Rs
2 each fully paid up and 3,02,19,380 Cumulative Non- Particiapating
Redeemable Preference shares of Rs 10 each to the members of ACETC
Rentals Private Limited.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has a wholly Owned Subsidiary and a Fellow Subsidiary, at
the end of the current financial year ended on 31st March, 2015,
namely:
1. Frested Limited, Cyprus-wholly Owned Subsidiary
2. SC Forma SA, Romania - FellowSubsidiary
During the year under report, the only wholly Owned Indian Subsidiary
Company, "Action Developers Limited" [CIN U45200DL2008PLC177936] has
opted for voluntary dissolution under Section 560 (5) of the Companies
Act, 1956 under Fast track scheme vide SRN C32950198 dated 15/11/2014
and accordingly the name of "Action Developers Limited" is struck off
in the records of Registrar of Companies and the said wholly Owned
Indian Subsidiary Company stands dissolved.
The Consolidated Financial Statements presented by the Company include
the financial results of its subsidiary companies. In accordance with
section 129(3) of the Companies Act, 2013 and Accounting Standard (AS)
- 21 on Consolidated Financial Statements, the Company has prepared
consolidated financial statements of the Company and all its
subsidiaries, which form part of this Annual Report.
A report on the performance and financial performance of the Subsidary
and Associate Companies as per Companies Act, 2013 is provided in the
prescribed form AOC -1 alongwith the Consolidated Financial Statements
and therefore not repeated here for the sake of brevity. The Policy for
determining material subsidiaries may be accessed on the Company's
website viz, www.ace-cranes.com
BOARD OF DIRECTORS
The Board consists of eight directors, out of which four are
independent directors, namely:
Name of Directors Position in the Company
Mr. Vijay Agarwal Chairman & Managing Director
Mrs. Mona Agarwal Whole-Time Director
Mr.Sorab Agarwal Executive Director
Mrs. Surbhi Garg Executive Director
Mr. Girish Narain Mehra Independent Director
Mr. Subhash ChanderVerma Independent Director
Dr. Amar Singal Independent Director
Maj.Gen. (Retd.)Dr.
KeshavChandra Agrawal IndependentDirector
The existing term of appointment of all the Independent Directors as
mentioned in above table is upto the date of forthcoming Annual General
Meeting (AGM) and are eligible and offer themselves for re-appointment
as Independent Directors on the Board.
The Company has received notices alongwith the requisite deposit from
the members pursuant to Section 160(1) of the Companies Act, 2013
signifying their intention to propose their candidature for appointment
as Director of the Company at the forthcoming AGM.
The Independent Directors of the Company have given declarations that
they meet the criteria of independence as laid down under Section
149(6) of the Companies Act, 2013 and Clause 49 of the Listing
Agreement.
In accordance with Article 88 (1) of the Articles of Association of the
Company Mrs. Mona Agarwal is liable to retire by rotation in ensuing
Annual General Meeting and being eligible offer herself for
re-appointment at the forthcoming AGM.
Your Directors recommend for their re-appointment. None of the
Directors of your Company is disqualified as per provisions of the
Companies Act, 2013.
KEY MANAGERIAL PERSONNEL:
Pursuant to the Provisions of Section 203 of the Companies Act, 2013,
Mr. Vijay Agarwal, Chairman & Managing Director, Mrs. Mona Agarwal, Mr.
Sorab Agarwal & Mrs. Surbhi Garg, Whole Time Director Mr. Rajan Luthra,
CFO and Mr. Neeraj Jain, Company Secretary were designated as Key
Managerial Personnel of the Company.
Subsequently, Mr. Neeraj Jain resigned w.e.f. 4th February 2015 . Mr.
Radhey Shyam Jhanwer has been appointed as Head-Corporate Affairs &
Company Secretary w.e.f. 5th February, 2015.
COMMITTEES OFTHE BOARD
Detailed information on the Board and its Committees is provided in the
Report on Corporate Governance forming part of this Annual Report.
Board and Audit Committee Meetings Audit Committee
As at March 31, 2015, the Audit Committee comprised of three
Independent Directors namely, Mr Subhash Chander Verma, Dr. Amar Singal
& Mr Girish Narain Mehra and one Non-Independent Director namely, Mr
Vijay Agarwal. All the recommendations made by the Audit Committee were
accepted by the Board.
Nomination and Remuneration Committee
As at March 31, 2015, the Nomination and Remuneration Committee
comprised of three Independent Directors namely. Dr Amar Singal, Mr.
Girish Narain Mehra and Mr Subhash Chander Verma.
Corporate Socal Responsibility Committee (CSR Committee)
As at March 31, 2015, CSR Committee comprised of two Independent
Directors namely. Dr Amar Singal & Maj. Gen. (Retd.) Dr KeshavChandra
Agrawal and one Non-Independent Director namely, Mrs. Mona Agarwal.
Stakeholders Relationship Committee
As at March 31, 2015, Stakeholders Relationship Committee comprised of
two Independent Directors namely. Dr Amar Singal & Mr. Subhash Chander
Verma and one Non- Independent Director namely, Mr. Sorab Agarwal.
NUMBEROFMEETINGS
During the year ended 31st March, 2015, five meetings of the Board were
held.
During the year ended 31st March, 2015, five meetings of the Audit
Committee were held.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Companies Act, 2013,
your Directors hereby confirm that they:
I) have followed in the preparation of Annual Accounts for the
financial year 2014-15, the applicable Accounting Standards and no
material departures have been made forthe same;.
II) had selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company as
at 31st March, 2015 and of the profit of the Company for the year ended
on that date;
III) had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
IV) had prepared the annual accounts on a going concern basis.
V) The directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and are operating effectively; and.
VI) The directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems are
adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis for the year as stipulated under
Clause 49 of the Listing Agreement is separately given and forms part
of this Annual Report provides a more detailed analysis on the
performance of individual businesses and their outlook.
REPORT ON CORPORATE GOVERNANCE
The Company is committed to maintain the highest standards of Corporate
Governance and adhere to the corporate governance requirements set out
by SEBI. The report on Corporate Governance as stipulated under Clause
49 of the Listing Agreement is separately given and forms part of this
Annual Report. The requisite certificate from a Practicing Company
Secretary confirming compliance of the conditions of Corporate
Governance is attached to the Report on Corporate Governance.
RELATED PARTY TRANSACTIONS
All the contracts/ arrangements/ transactions that were entered into by
the Company during the financial year with related parties were on an
arm's length basis and in the ordinary course of business. During the
year, the Company had not entered into any contract/ arrangement/
transaction with related parties which could be considered material in
accordance with the policy of the Company on materiality of related
party transaction. All Related Party Transactions are placed before the
Audit Committee for approval.
The policy on Related Party Transactions as approved by the Board is
available on website of the Company viz, www.ace-cranes.com
Details of Related Party Transactions are given at Note No.
27((B)(8)(e)to the Standalone Financial Statements. None of the
Directors of the Company has any pecuniary relationships or
transactions vis-a-vis the Company.
CORPORATE SOCIAL RESPONSIBILITY
The CSR Committee has framed and formulated a CSR Policy indicating the
activities to be undertaken by the Company, in accordance with schedule
VII of the Act and the Companies (Corporate Social Responsibility
Policy) Rules, 2014 issued under the Act. The same has also been
approved by the Board. The CSR policy is available at the website of
the Company viz, www.ace-cranes.com. The Annual Report on CSR
Activities, as stipulated under the Act and the Listing Agreement forms
an integral part of this Report and is appended as Annexure-I
RISK MANAGEMENT
The Company has implemented a comprehensive and fully integrated
'Enterprise Risk Management' framework in order to anticipate,
identify, measure, manage, mitigate, monitor and report the principal
risks and uncertainties that can impact its ability to achieve its
strategic business objectives.
The Company has introduced several improvements to Enterprise Risk
Management and processes to drive a common integrated view of risks and
optimal risk mitigation responses.
This integration is enabled by alignment of Risk Management, Internal
Audit, Legal and compliance methodologies and processes in order to
maximise enterprise value of the Company and ensure high value creation
for our stakeholders overa period of time.
The details of the Enterprise Risk Management framework with details of
the principal risks and the plans to mitigate the same are given in the
'Risk Management Report' section of the 'Management Discussion and
Analysis Report' which forms part ofthisAnnual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with
reference to financial statements. Such controls were tested during the
financial year and no material weaknesses in the design or operation
were observed. Review of the financial controls is done on an ongoing
basis.
POLICIES
WHISTLE BLOWER POLICY/VIGIL MECHANISM
The Company has a Whistle Blower Policy (the "WB Policy") with a view
to provide vigil mechanism to Directors, employees and other
stakeholders to disclose instances of wrongdoing in the workplace and
report instances of unethical behavior, actual or suspected fraud or
violation of the Company's code of conduct or ethics policy. The Policy
provides that the Company investigates such incidents, when reported,
in an impartial manner and takes appropriate action. The WB Policy also
provides mechanism for adequate safeguards against victimization of
Director(s)/ Employees who avail of the mechanism and also provide for
direct access
to the Chairman of the Audit Committee in exceptional cases. The
Whistle Blower Policy has been posted on the website of the Company and
the details of the same are explained in the Report on Corporate
Governance forming part of this Annual Report. The Whistle Blower
Policy is available at the website of the Company viz,
www.ace-cranes.com
PREVENTION OF SEXUAL HARRASSMENT POLICY
The Company has a Prevention of Sexual Harassment Policy in force in
terms of Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013. The objective of this Policy is
to ensure a safe, secure and congenial work environment where employees
will deliver their best without any inhibition, threat or fear. The
Company has Zero tolerance to any form of harassment especially if it
is sexual in nature.
No Complaints were received during the year.
REMUNERATION POLICY
The Board, on the recommendation of the Nomination & Remuneration
Committee framed a Remuneration Policy for Non-Executive Directors
(including Independent Directors) and a Remuneration Policy for Key
Managerial Personnel and Other Employees of the Company. The
Remuneration Policy for Non-Executive Directors, Key Managerial
Personnel and Other employees of the Company is provided as Annexure-ll
to this Report.
RESEARCH AND DEVELOPMENT
Your Company continues to invest in a comprehensive Research &
Development (R&D) programme to develop a unique source of sustainable
competitive advantage and build future readiness by leveraging
contemporary advances in several relevant areas of science and
technology and blending the same with classical concepts of product
development.
The Company has dedicated R&D centres at Jajru Road, Faridabad and at
Dudhola Link Road, Dudhola Village, Palwal. Both these centres have
accreditations from the Ministry of Science and Technology, Govt, of
India. Both the centres continuously carries out Research and
Developments for developing new products and also focus on the quality
of products, making them more economical, cost effective and
userfriendly.
AUDITORS AND AUDITORS' REPORT
M/s. Rajan Chhabra & Co., Chartered Accountants, were appointed as the
Statutory Auditors of the Company at 20th Annual General Meeting of the
Company to hold the office for the three consecutive years subject to
ratification at every Annual General Meeting. Your Company has received
confirmation from the above mentioned firm regarding consent and
eligibility under section(s) 139 & 141 of the Company Act, 2013, read
with Company (Accounts) Rules, 2014 for ratification of appointment as
the Statuary Auditors of the Company. As required under clause 41 of
the listing agreement, the auditor has also confirmed that they hold a
valid certificate issued by the Institute of Chartered Accountants of
India.
The Audit Committee and the Board of Directors recommended the
ratifications of the appointment of the M/s. Rajan Chhabra & Co.,
Chartered Accountants, as the Auditor of your Company for financial
year2015-16 till the conclusion of next AGM, at a remuneration to be
decided by the Audit Committee of the Board of Directors.
The Notes on Financial Statements referred to in the Auditors' Report
are self-explanatory and do not require any further comments. The
Auditors' Report does not contain any qualification, reservation or
adverse remark.
COST AUDITORS
The Central Government has made it mandatory for the Company to conduct
a cost audit and accordingly, your Directors have appointed M/s Vandana
Bansal & Associates, Cost Accountants as the Cost Auditors to conduct
the Cost Auditfortheyear2015-16.
SECRETARIAL AUDITOR
The Board has appointed M/s. MZ & Associates, Company Secretaries to
conduct the Secretarial Audit of the Company for the financial year
2014-15. The Secretarial Audit Report is annexed to this Report as
Annexure III. There is no qualification, reservation or adverse
remark(s) in the Secretarial Audit Report.
DISCLOSURES:
EMPLOYEES
The total number of permanent employees as on 31st March, 2015 stood at
975 as compared to 906 as on March 31,2014.
PARTICULARS OF THE EMPLOYEES AND RELATED DISCLOSURES:
Disclosures pertaining to remuneration and other details as required
under Section 197(12) of the Act read with Rule 5(1) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 form
part of this Report and are annexed as Annexure IV.
There are no employees who are drawing remuneration in excess of the
limits as set out in provisions of Section 197(12) of the Act and the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014.
PUBLIC DEPOSITS
During the year, your Company has not accepted any deposits under
Section 73 of the Companies Act, 2013 (herein after referred to as the
"Act") and as such, no amount on account of principal or interest on
public deposits was outstanding as of March 31,2015.
PARTICULARS OF LOANS, INVESTMENTS, GUARANTEES AND SECURITIES
Details of loans, investments, guarantees and securities provided as
covered under the provisions of Section 186 of the Companies Act, 2013
are provided in the notes to the standalone financial statements.
EMPLOYEES STOCK OPTION SCHEME
During the year under review, the Company has not allotted any shares
under Employee Stock Option Scheme (ESOS) and hence no disclosure is
required to be made in compliance with Clause 12 of the Securities and
Exchange Board of India (Employee Stock Option Scheme and Employee
Stock Purchase Scheme) Regulations, 1999.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information pursuant to conservation of energy, technology absorption
and foreign exchange earnings and outgo, as required to be disclosed
under the Companies Act, 2013 is annexed as Annexure-V and forms part
of this report.
EXTRACT OF ANNUAL RETURN
Extract of the Annual Return in Form MGT- 9 is annexed herewith as
Annexure-VI and forms part of this report.
THE FAMILIARISATION PROGRAMMES FOR INDEPENDENT DIRECTORS
The Company has put in place a system to familiarise its Independent
Directors with the Company, their roles, rights & responsibilities in
the Company, nature of the industry in which the Company operates,
business model of the Company, etc. The details of such familiarisation
programmes are put up on the website of the Company viz,
www.ace-cranes.com
FORMAL ANNUAL PERFORMANCE EVALUATION OF THE BOARD AND THAT OF ITS
COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Companies Act, 2013 and Clause 49 of the
Listing Agreement, Independent Directors at their separate meeting,
without participation of the Non- independent Directors and Management
have considered and evaluated the Board's performance and performance
of the Chairman and Non-independent Directors. The Independent
Directors in the said meeting have also assessed the quality, quantity
and timeliness of flow of information between the Company Management
and the Board.
The Board of Directors has evaluated the performance of each of
Independent Directors (without participation of the relevant Director).
The Board has carried out the annual evaluation of its own performance
and that of its Directors individually. The evaluation criteria as
approved by the Nomination and Remuneration Committee included various
aspects of the functioning of Board such as composition, process and
procedures including adequate and timely information, attendance,
decision making, roles and responsibilities etc.
The performance of individual directors including the Chairman was
evaluated on various parameters such as industry knowledge &
experience, vision, commitment, time devoted etc. The evaluation of
Independent Directors was based on aspects like participation &
contribution to the Board decisions, knowledge, experience, integrity
etc.
General
Your Directors state that no disclosure or reporting in respect of the
following matters are made in the Directors' Report as there were no
transactions on thesemattersinthefinancial year 2014-15.
1. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
2. The Managing Director and the Whole-time Directors does not receive
any remuneration or commission from any of its subsidiaries.
3. No significant or material orders were passed by the regulators or
courts or tribunals which impact the going concern status and the
company's operations in future.
ACKNOWLEDGEMENTS
The Directors wish to place on record their sincere appreciation for
the support and co-operation extended by all the customers, vendors.
Dealers and business associates. The Company also expresses its
gratitude to the Government authorities and the Company's Bankers for
all the help and encouragement, they extend to the Company. The Board
places on record its appreciation to all the employees for their
dedicated and committed services. Your Directors deeply acknowledge the
continued trust and confidence that the Shareholder place in the
management and is confident that with their continued support, the
Company will achieve its objectives and emerge stronger in the coming
years.
For and on behalf of the Board of
Action Construction Equipment Limited
Vijay Agarwal
Chairman & Managing Director
Place: New Delhi
Dated: 30th May, 2015
Mar 31, 2013
The Directors are pleased to present the 19th Annual report and Audited
Statement of Accounts for the financial year ended 31 st March, 2013.
(Rs. in lacs)
FINANCIAL RESULTS 2012-13 2011-12
Gross Turnover 69,280 87,868
Excise Duty 3,172 3,110
Net Turnover 66,108 84,758
Other Income 1,215 1,248
Total Income 67,323 86,006
Profit before
Depreciation Interest and Tax 3,510 5,703
Less:
Depreciation 1,361 1133
Interest 1,045 735
Provision for Taxation 382 988
Net Profit after Tax 722 2,847
Profit brought forward 4,180 2,563
Profit available for Appropriations 4,902 5,410
Appropriations:
Dividend 198 198
Corporate Tax on Dividend 34 32
Transferred to General Reserve 200 1,000
Profit carried to Balance Sheet 4,470 4,180
FINANCIAL HIGHLIGHTS
FY 2012-13 proved to be a challenging year amidst global economic
uncertainties and disturbances in many parts of the world. As far as
Indian Economy is concerned. Weakness in industry (comprising the
mining and quarrying, manufacturing, electricity, gas and water supply,
and construction sectors registered a growth rate of only 3.5 per cent
and 3.1 per cent in 2011-12 and 2012-13 respectively. The rate of
growth of the manufacturing sector was even lower at 2.7 per cent and
1.9 per cent for these two years respectively. The growth of equipment
manufacturing industry is interlinked with the growth of Infrastructure
and indirectly with the growth of Indian Economy. According to the
ministry''s estimate, Rs. 7 lakh crores of projects are stalled at
various stages due to reasons such as environment clearances and land
acquisition issues. Despite these constraints and challenging
environment, the Company performed reasonably well.
The Company''s gross turnover stood at Rs.69,280 lacs, as compared to
Rs.87,868 lacs previous year. The profit before depreciation, interest
and tax stood at Rs.3,510 lacs in 2012- 13, as against Rs.5,703 lacs in
2011-12. The profit after tax was Rs.722 lacs in 2012-13, as against
Rs.2,847 lacs in 2011 - 12. The weakening of Indian Rupee throughout
the year led to a loss of Rs.742 lacs. Company has taken several steps
to reduce cost and increase its market share in all products.
DIVIDEND
Your Directors are pleased to recommend Dividend of 10% (0.20/- paisa)
per share on the Paid up Equity Share Capital of the Company for the
year 2012-13. Total dividend (including dividend tax) will absorb
Rs.232/- lacs out of the profits available for the year 2012-13. The
payment of dividend is subject to the approval of the shareholders at
the ensuing annual general meeting of the Company.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis, forms an integral part of this
Annual Report; provides a more detailed analysis on the performance of
individual businesses and their outlook.
DIRECTORS
In accordance with Article 135 of the Articles of Association of the
Company Shri Keshav Chandra Agrawal and Shri Subhash Chander Verma,
Directors are liable to retire by rotation in ensuing Annual General
Meeting and being eligible offer themselves for re-appointment.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217 (2AA) of the Companies Act,
1956, your Directors hereby confirm that they:
I) have followed in the preparation of Annual Accounts, the applicable
Accounting Standards with proper explanation relating to material
departures if any;
II) had selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company at
the end of the financial year and of the profit of the Company for the
year under review;
III) had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
IV) had prepared the annual accounts on a going concern basis.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has two wholly Owned Subsidiary and a Fellow Subsidiary,
namely:
1. Frested Limited, Cyprus-Wholly Owned Subsidiary
2. SC Forma SA, Romania - Fellow Subsidiary
3. Action Developers Limited, India-Wholly Owned Subsidiary
In accordance with the general circular issued by the Ministry of
Corporate Affairs, Government of India, the Balance Sheet, Profit and
Loss Account and other documents of the subsidiary companies are not
being attached with the Balance Sheet of the Company. However, the
financial information of the subsidiary companies is disclosed in the
Annual Report in compliance with the said circular.
The Company will make available the Annual Accounts of the subsidiary
companies and the related detailed information to any member of the
Company who may be interested in obtaining the same. The annual
accounts of the subsidiary companies will also be kept open for
inspection at the Registered Office of the Company and that of the
respective subsidiary companies. The Consolidated Financial Statements
presented by the Company include the financial results of its
subsidiary companies.
AUDITORS
The Statutory Auditors of the Company, M/s. Rajan Chhabra & Co.,
Chartered Accountants, will retire at the ensuing Annual General
Meeting of the Company. They are eligible for re- appointment and have
furnished a certificate to this effect that the proposed appointment,
if made, will be in accordance with Section 224 (1B) of the Companies
Act, 1956.
COST AUDITORS
In pursuance of Section 233-B of the Companies Act, 1956, your
Directors have appointed M/s Vandana Bansal & Associates, Faridabad, as
the Cost Auditors to conduct the Cost Audit forthe year 2013-14.
DEPOSITS
Your Company has not accepted any public deposit during the year under
review.
QUALITY CERTIFICATION
Your Company has got CE Certification for most of its manufactured
products. After getting this Certification, products of your Company
are being well accepted in the International Market. Your Company is
already ISO 9001 certified Company by CVI (Conformity Verification
International), which is internationally recognized for the production,
quality control and other qualities. This ensures that its standards of
design, development, procurement,
manufacturing, testing, installation and product support meet the most
stringent norms. The ISO Certification gives international recognition
and will help the Company, to boost its export turnover.
HUMAN RESOURCES
The dedicated efforts of its competent and committed employees have
contributed to the Company''s achievements in these challenging economic
conditions. Your Board believes that Employees are vital to the
Company. Your Company has created a favorable work environment which
encourages innovation and meritocracy. Cordial industrial relations
environment prevailed at all the manufacturing units of the Company
during the year.
PARTICULARS OF EMPLOYEES
Information as per Section 217(2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules, 1975, forms part
of this Report. However, as per the provisions of Section 219(1) (b)
(iv) of the Companies Act, 1956, the Report and the Accounts are being
sent to all shareholders, excluding the Statement of Particulars under
Section 217(2A). Any shareholder, interested in obtaining a copy of
this statement, may write to the Company Secretary.
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to the belief that it exists not just to run
business and generate profits, but also to fulfill its duties as a
responsible corporate citizen. As a responsible corporate citizen, ACE
recognized its need to deliver value to the society, which is the
reason for its existence.
Keeping in view of the above and being a responsible corporate citizen,
your Company has set up a trust, i.e ''ACE Emergency Response Service
Trust'' inauguration of which was done by Shri Bhupinder Singh Hooda,
Hon''ble Chief Minister of Haryana on 17.03.2013. The essential
objective of the trust is to rescue by providing ambulances to be
stationed at various locations in Ballabgarh and Palwal. These
ambulances are well equipped with all major life saving devices &
trained medical staff. These ambulances will carry any person who needs
immediate medical attention & will take them to the nearest hospital.
We believe that through this service, we will be able to save thousands
of lives who are not able to get medical aid in the first few hours of
emergency.
CORPORATE GOVERNANCE
As required by the existing clause 49 of the Listing Agreements with
the Stock Exchanges, a detailed report on Corporate Governance is
included in the Annual Report. The Practicing Company Secretary has
certified the Company''s compliance of the requirements of Corporate
Governance in terms of clause 49 of the Listing Agreement and the same
is annexed to the Report on Corporate Governance.
RESEARCH AND DEVELOPMENT
Your Company continues to invest in a comprehensive Research &
Development (R&D) programme to develop a unique source of sustainable
competitive advantage and build future readiness by leveraging
contemporary advances in several relevant areas of science and
technology and blending the same with classical concepts of product
development.
The Company has set up a dedicated R&D centre at Jajru Road, in
addition to existing R&D Centre at Dudhola Link Road. Both these
centres have accreditations from the Ministry of Science and
Technology, Govt of India. Both the centres continuously carries out
Research and developments for developing new products and also focus on
the quality of products, making them more economical, cost effective
and userfriendly.
PARTICULARS ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND
FOREIGN EXCHANGE EARNING AND OUTGO
Information pursuant to Section 217 (1)(e) of the Companies Act, 1956
read with companies (Disclosure of Particulars in the Report of the
Board of Directors) Rules, 1988 is annexed and forms a part of this
report.
ACKNOWLEDGEMENT
The Directors wish to place on record their sincere appreciation for
the committed and dedicated services of the employees of the Company.
The Board also wishes to thank Government of India, various State
Governments and the Company''s Bankers for all the help and
encouragement they extend to the Company. Your Directors deeply
acknowledge the continued trust and confidence that the Shareholders,
Customers, the Dealers and the Suppliers have placed in your Company.
For and on behalf of the Board of
Action Construction Equipment Ltd.
Vijay Agarwal
Chairman & Managing Director
Place: Faridabad
Date: 25th May, 2013
Mar 31, 2012
The Directors are pleased to present the 18th Annual report and Audited
Statement of Accounts for the financial year ended 31st March, 2012.
(Rs. in lacs)
FINANCIAL RESULTS 2011-12 2010-11
Gross Turnover 87,868 70,759
Excise Duty 3,110 2,111
Net Turnover 84,758 68,648
Other Income 1,248 1,390
Total Income 86,006 70,038
Profit before Depreciation Interest and Tax 5,703 6,473
Less:
Depreciation 1133 689
Interest 735 352
Provision for Taxation 988 1352
Net Profit after Tax 2,847 4,059
Profit brought forward 2,563 1,604
Profit available for Appropriations 5,410 5,663
Appropriations:
Dividend 198 1858
Corporate Tax on Dividend 32 308
Transferred to General Reserve 1,000 1,000
Profit carried to Balance Sheet 4,180 2,497
FINANCIAL PERFORMANCE
In spite of the challenging year in which the global business
sentiments were marred by poor economic growth, slowdown in
investments, high inflation, interest rate hike etc, the gross turnover
of the Company has increased to Rs.87868 lacs from Rs.70759 Lacs for
the year ending 31.3.2012, indicating a growth of 24% on year over year
basis. However the profit before tax has decreased from Rs.5432 Lacs
for financial year ending 31.3.2011 to Rs.3835 Lacs for current
financial year ending 31.3.2012. The weakening of Indian Rupee in the
second half of the year led to a loss of Rs. 985 Lacs.
The company is focusing on reducing its cost and increasing its market
share in all the products.
AMALGMATION OF ACE STEEL FAB PVT LIMITED
During the year under review, ACE Steel Fab Pvt Ltd has merged with the
Company w.e.f. 1st Oct, 2011. Accordingly the financial results of the
Company include the financial results of the ACE Steel Fab Pvt Limited
from 1st Oct, 2011. Company has issued 60,55,000 Equity shares to the
Shareholders of ACE Steelfab Private Ltd consequent to the order
received from Hon'ble High Court of Delhi sanctioning the scheme of
Amalgamation of ACE Steelfab Private Ltd with the Company.
SHARE WARRANTS
Company had issued 50,00,000 (Fifty Lac) Convertible Share Warrants to
Mrs. Mona Agarwal, Promoter Director of the Company in accordance with
Chapter VII of the Securities and Exchange Board of India (Issue of
Capital and Disclosure Requirements) Regulations, 2009("ICDR
Regulations") on 30th April 2010 which had to be converted in the
Equity Share on 26th November 2011 after payment of 75% remaining
amount as per the terms of the issue.
No application for allotment of shares was received therefore the
Company forfeited the Application money after due date i.e. 26th
November 2011.
There are no outstanding GDRs /ADRs, Warrants or any Convertible
instrument.
DIVIDEND
In order to conserve the cash resources your Directors have recommended
10% Equity Dividend per share on the Paid up Equity Share Capital of
the Company for the year 2011-12. Total dividend (including dividend
tax) will absorb Rs. 230 Lacs.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis of the financial condition and
result of operations separately form part of this report.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements have been prepared by your
Company in accordance with the applicable Accounting Standards (AS-21,
AS-23 and AS-27) issued by the Institute of Chartered Accountants of
India and the provisions of the listing agreement with the Stock
Exchanges. Together with the Auditors' Report, these form part of the
Annual Report.
In terms of the General Circular of the Ministry of Corporate Affairs
(MCA), Government of India, the copy of Balance Sheet, Statement of
Profit and Loss, Directors' Report, Auditors' Report, etc., of the
subsidiary companies is not attached with the Annual Report of the
Company. The related information on the Annual Accounts of the
subsidiary companies shall be made available to the shareholders of the
Company and of the subsidiary companies, who shall seek such
information at any point of time. The Annual Accounts of the subsidiary
companies will also be kept for inspection by any shareholder at the
Registered Office of the Company and that of the subsidiary companies
concerned. The Statement pursuant to Section 212 of the Companies Act,
1956, containing the details of the Company's subsidiaries and the gist
of the financial performance of the subsidiary companies forms part of
the Consolidated Financial Statements of this Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217 (2AA) of the Companies Act,
1956, your Directors hereby confirm that they:
I) have followed in the preparation of Annual Accounts, the applicable
Accounting Standards with proper explanation relating to material
departures if any;
II) had selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company at
the end of the financial year and of the profit of the Company for the
year under review;
III) had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
IV) had prepared the annual accounts on a going concern basis.
DIRECTORS
Shri Sorab Agarwal and Shri Girish Narain Mehra (IAS Retd), Directors
are liable to retire by rotation in ensuing Annual General Meeting and
being eligible offer themselves for re-appointment. Mrs. Surbhi Garg
was appointed as additional director on 12.11.2011. She has been
appointed as Executive Director w.e.f. 1st April, 2012
Your Directors recommend for their appointment / re-appointment. None
of the Directors of your Company is disqualified as per provisions of
Section 274(1) (g) of the Companies Act, 1956.
AUDIT AND SYSTEMS
Your Company believes that internal control is a necessary concomitant
of the principle of governance that freedom of management should be
exercised within a framework of appropriate checks and balances. Your
Company remains committed to ensuring an effective internal control
environment that provides assurance on the efficiency of operations and
security of assets.
ADEQUACY OF INTERNAL CONTROL SYSTEMS
The Company has well defined internal control system which aims at the
protection of the Company's resources, efficiency of operations,
compliances with the legal obligations and company's policies and
procedures. In a phased manner, the internal audit function covers and
reviews the internal controls and the procedures in all the plants and
warehouses of the Company.
AUDITORS
The Auditors of the Company, M/s. Rajan Chhabra & Co., Chartered
Accountants, will retire at the ensuing Annual General Meeting of the
Company. They are eligible for re- appointment and have furnished a
certificate to this effect that the proposed appointment, if made, will
be in accordance with Section 224 (1B) of the Companies Act, 1956.
AUDITORS' OBSERVATION
Observations of the Auditors, if any when read together with the
relevant notes on accounts and accounting policies are self-explanatory
and do not require any further comments.
COST AUDITORS
In pursuance of Section 233-B of the Companies Act, 1956, your
Directors have appointed M/s Vandana Bansal& Associates, Faridabad, as
the Cost Auditors to conduct the Cost Audit for the year 2012-13.
The due date for filing the Compliance Reports for the financial year
2011-2012 is 30th September, 2012 and the same will be filed on or
before the due date.
DEPOSITS
Your Company has not accepted any public deposit during the year under
review.
QUALITY CERTIFICATION
Your Company has got CE Certification for most of its manufactured
products. After getting this Certification, products of your Company
are being well accepted in the International Market. Your Company is
already ISO 9001 certified Company by CVI (Conformity Verification
International), which is internationally recognized for the production,
quality control and other qualities. This ensures that its standards of
design, development, procurement, manufacturing, testing, installation
and product support meet the most stringent norms. The ISO
Certification gives international recognition and will help the
Company, to boost its export turnover.
HUMAN RESOURCES
In spite of a challenging year, cordial industrial relations
environment prevailed at all the manufacturing units of the Company
during the year.
PARTICULARS OF EMPLOYEES
Information as per Section 217(2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules, 1975, forms part
of this Report. However, as per the provisions of Section 219(l) (b)
(iv) of the Companies Act, 1956, the Report and the Accounts are being
sent to all shareholders, excluding the Statement of Particulars under
Section 217(2A). Any shareholder, interested in obtaining a copy of
this statement, may write to the Company Secretary.
HEALTH, SAFETY AND ENVIRONMENT PROTECTION
The Company sustained its initiatives to maintain a pollution free
environment, by elimination of waste, optimum utilization of power and
preventive maintenance of equipment and machineries to keep them in
good condition. Safety and health of the people working in and around
manufacturing facilities is top priority of the Company and we are
committed to improving this performance year after year
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to the belief that it exists not just to run
business and generate profits, but also to fulfill its duties as a
responsible corporate citizen. At ACE, we define Corporate Social
Responsibility as "continuing commitment for operating the core
business in a socially responsible way, complemented by investment in
communities to produce an overall positive impact on the society". The
focus areas of your Company's CSR activities are Environment
Protection, Planting trees and Health/Medical facilities to the
employees and public at large. In addition to the continuing CSR
activities, Company has set up a trust to provide medical aid to the
needy.
As a responsible corporate citizen, ACE recognized its need to deliver
value to the society, which is the reason for its existence
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance and Certificate regarding compliance of
conditions of Corporate Governance from practicing Company Secretary
forms part of the Annual Report.
RESEARCH AND DEVELOPMENT
Your Company continues to invest in a comprehensive Research &
Development (R&D) programme to develop a unique source of sustainable
competitive advantage and build future readiness by leveraging
contemporary advances in several relevant areas of science and
technology and blending the same with classical concepts of product
development.
The Company has set up a dedicated R&D centre at Jajru Road, in
addition to existing R&D Centre at Dudhola Link Road. Both these
centres have accreditations from the Ministry of Science and
Technology, Govt of India. Both the centres continuously carries out
Research and developments for developing new products and also focus on
the quality of products, making them more economical, cost effective
and user friendly.
PARTICULARS ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND
FOREIGN EXCHANGE EARNING AND OUTGO
Information pursuant to Section 217 (1)(e) of the Companies Act, 1956
read with companies (Disclosure of Particulars in the Report of the
Board of Directors) Rules, 1988 is annexed and forms a part of this
report.
ACKNOWLEDGEMENT
The Directors wish to place on record their sincere appreciation for
the committed and dedicated services of the employees of the Company,
who have ensured that the company continues to grow at a faster pace.
The Board also wishes to thank Government of India, various State
Governments and the Company's Bankers for all the help and
encouragement they extend to the Company. Your Directors deeply
acknowledge the continued trust and confidence that the Shareholders,
Customers, the Dealers and the Suppliers have placed in your Company.
For and on behalf of the Board of
Action Construction Equipment Ltd.
Vijay Agarwal
Chairman & Managing Director
Place: Faridabad
Date: 04th August, 2012
Mar 31, 2011
The Members
The Directors are pleased to present the 17th Annual report and Audited
Statement of Accounts for the financial year ended 31st March, 2011
FINANCIAL RESULTS
(Rs. in lacs)
2009-10
2010-11
Gross Turnover 70,759 43,783
Excise Duty 2,111 1,071
Net Turnover 68,648 42,712
Other Income 1,390 687
Total Income 70,038 43,399
Profit before Depreciation
Interest and Tax 6,473 4,060
Less:
Depreciation 689 525
Interest 352 258
Provision for Taxation 1,373 833
Net Profit after Tax 4,059 2,444
Profit brought forward 1,604 1,208
Profit available for Appropriations 5,663 3,652
Appropriations:
Dividend (Interim & Final) 1,858 899
Tax on Dividend 308 149
Transferred to General Reserve 1,000 1,000
Profit carried to Balance Sheet 2,497 1,604
FINANCIAL PERFORMANCE
During the year the gross turnover of the Company has increased to Rs.
70759 lacs from Rs. 43783 lacs for the year ending 31.3.2010,
indicating a growth of 62% on year over year basis. The profit before
tax has increased from Rs. 3277 Lacs for financial year ending
31.3.2010 to Rs. 5432 Lacs for current financial year ending 31.3.2011,
a growth of 66%.
The growth momentum created in the company in financial year 2011 led
to increase in the numbers for all product categories and the same
shall be carried forward going ahead. The company is focused on
reducing its costs and increasing its market share in all the products.
DIVIDEND
During the current financial year, Directors had declared and
distributed interim Dividend of 50 % i.e. Rs. 1 on equity shares of Rs.
2 each, absorbing an aggregate amount of Rs. 929 lacs (excluding
Dividend Tax of Rs.154 lacs). The Board has recommended a final
Dividend of 50 % i.e. Rs. 1 on equity share of Rs. 2 each which will be
paid after your approval at the ensuing Annual General Meeting. The
final Dividend will absorb an aggregate amount of Rs. 929 lacs
(excluding Dividend Tax of Rs. 154 lacs).
Thus, the total dividend distributed for the year is 100%.
CHANGE IN SHARE CAPITAL
During the year the Authorised Share Capital of the Company was
increased from Rs. 2000 lacs to Rs. 2400 lacs.
PREFRENTIAL ALLOTMENT
During the year the Company has issued 30 lacs equity shares on
Preferential Allotment to Reliance Capital Limited.
SHARE WARRANTS
The Company has also issued 50 lacs convertible warrants to the
promoters of the Company. The Company has received an aggregate sum of
Rs. 518 lacs equivalent to 25% of the total subscription amount on the
aforesaid warrants.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis of the financial condition and
result of operations separately form part of this report
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Your Company has a wholly owned overseas subsidiary (WOS) Company at
Cyprus viz M/s FRESTED LIMITED, and through it, your Company acquired
89.50% equity stake in a Romanian Company viz. SC FORMA SA, Romania.
Your Company also has a Wholly-owned Subsidiary Company viz. Action
Developers Ltd. Therefore, in compliance of the Listing Agreement with
the Stock Exchanges and Accounting Standard issued by The Institute of
Chartered Accountants of India, your Company has consolidated the
Accounts incorporating the Accounts of all these three Subsidiary
Companies. The audited Consolidated Financial Statements together with
Auditors' Report thereon, form part of the Annual Report.
Ministry of Company Affairs, Government of India, vide its Circular No.
2/2011 dated 08th February, 2011 has exempted the Companies from
attaching the Annual Report and other particulars of its Subsidiary
Companies along with the Annual Report of the Company u/s 212 of the
Companies Act, 1956, if certain conditions mentioned are fulfilled.
Therefore, the said Reports of the above Subsidiary Companies are not
attached here with. However, a statement giving certain information as
required under the circular is placed along with the Consolidated
Accounts.
The Annual Accounts of the subsidiary companies and the related
detailed information will be made available to the members of the
holding and subsidiary Companies seeking such information at any point
of time. The Annual Accounts of the Subsidiary Companies is also kept
for inspection by any member at its Registered Office
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217 (2AA) of the Companies Act,
1956, your Directors hereby confirm that :
I) That Directors have followed in the preparation of Annual Accounts,
the applicable Accounting Standards with proper explanation relating to
material departures if any;
II) That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year under review;
III) That the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
IV) That the Directors had prepared the annual accounts on a going
concern basis.
DIRECTORS
Shri Subhash Chandra Verma and Dr. Amar Singhal, Directors are liable
to retire by rotation in ensuing Annual General Meeting and being
eligible offer themselves for re- appointment. Your Directors recommend
for their re- appointment. None of the Directors of your Company is
disqualified as per provisions of Section 274(1) (g) of the Companies
Act, 1956.
INTER-SE RELATIONSHIP BETWEEN DIRECTORS
As per latest amendment made in Clause 49 of the Listing Agreement,
your Company has to report Inter-se relationship between the Directors
in the Annual Report of the Company. The following are the details of
Inter-se relationship between the Directors:-
Shri Vijay Agarwal, Chairman and Managing Director is husband of Smt.
Mona Agarwal, Whole-time Director and Father of Shri. Sorab Agarwal,
Executive Director of the Company.
All other Directors of the Company, act in there Independent capacities
and do not have any inter-se relationship among themselves.
ADEQUACY OF INTERNAL CONTROL SYSTEMS
The Company has well defined internal control system which aims at the
protection of the Company's resources, efficiency of operations,
compliances with the legal obligations and company's policies and
procedures. In a phased manner, the internal audit function covers and
reviews the internal controls and the procedures in all the plants and
warehouses of the Company.
AUDITORS
The Auditors of the Company, M/s. Rajan Chhabra & Co., Chartered
Accountants, will retire at the ensuing Annual General Meeting of the
Company. They are eligible for re- appointment and have furnished a
certificate to this effect that the proposed appointment, if made, will
be in accordance with Section 224 (1B) of the Companies Act, 1956.
AUDITORS' OBSERVATION
Observations of the Auditors, if any when read together with the
relevant notes on accounts and accounting policies are self-explanatory
and do not require any further comments.
DEPOSITS
Your Company has not accepted any public deposit during the year under
review.
QUALITY CERTIFICATION
Your Company has got CE Certification for most of its manufactured
products. After getting this Certification, products of your Company
are being well accepted in the International Market. Your Company is
already ISO 9001 certified Company by CVI (Conformity Verification
International), which is internationally recognized for the production,
quality control and other qualities. This ensures that its standards of
design, development, procurement, manufacturing, testing, installation
and product support meet the most stringent norms. The ISO
Certification gives international recognition and will help the
Company, to boost its export turnover.
HUMAN RESOURCES
In spite of a challenging year when demands of the products is
increasing by more than 60 %, cordial industrial relations environment
prevailed at all the manufacturing units of the Company during the
year.
PARTICULARS OF EMPLOYEES
Any shareholder interested in obtaining a copy of statement of
particulars of employees referred to in section 217(2A) of the
Companies Act, 1956, may write to the Company Secretary at the
Registered Office of the Company.
HEALTH, SAFETY AND ENVIRONMENT PROTECTION
The Company sustained its initiatives to maintain a pollution year
environment, by elimination of waste, optimum utilization of power and
preventive maintenance of equipments and machineries to keep them in
good condition. Safety and health of the people working in and around
manufacturing facilities is top priority of the Company and we are
committed to improving this performance year after year.
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to the belief that it exists not just to run
business and generate profits, but also to fulfill its duties as a
responsible corporate citizen. At ACE, we define Corporate Social
Responsibility as "continuing commitment for operating the core
business in a socially responsible way, complemented by investment in
communities to produce an overall positive impact on the society". The
focus areas of your Company's CSR activities are: Environment
Protection, Infrastructure, Planting trees and Health /Medical
facilities.
Your Company regularly conducts Yoga training program for its
employees. Your Company is particularly cautious of the health of its
employees and aims at providing good basic facilities and hygienic
conditions to work for its employees.
Your company believes that a cleaner environment maintained today by
the Company would be a precious gift to the upcoming generation. Your
Company believes in growing trees in the premises of the Company as
well as in nearby localities, thus maintaining a balance between
environment and corporate growth.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance Certificate from practicing company
secretary regarding compliance of conditions of Corporate Governance
forms part of the Annual Report.
RESEARCH AND DEVELOPMENT
The Company is in continuous process of improving quality of its
product. For that purpose, the Company has established an In-house
Research and Development Centre, which continuously carries out
Research and developments which can ultimately improve the quality of
products, making them more economical, cost effective and user
friendly.
Your Company has received recognition for its In-house Research and
Development Centre from Govt. of India. With this recognition, the
Company will be entitled to avail various incentives and benefits
(including income tax benefits) being provided by the Govt.
PARTICULARS ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND
FOREIGN EXCHANGE EARNING AND OUTGO
Information pursuant to Section 217 (1)(e) of the Companies Act, 1956
read with companies (Disclosure of Particulars in the Report of the
Board of Directors) Rules, 1988 is annexed and forms a part of this
report.
ACKNOWLEDGEMENT
The Directors wish to place on record their sincere appreciation for
the committed and dedicated services of the employees of the Company,
who have ensured that the company continues to grow at a faster pace.
The Board also wishes to thank Government of India, various State
Governments and the Company's Bankers for all the help and
encouragement they extend to the Company. Your Directors deeply
acknowledge the continued trust and confidence that the Shareholders,
Customers, the Dealers and the Suppliers have placed in your Company.
For and on behalf of the Board of
Action Construction Equipment Ltd.
Vijay Agarwal
Chairman & Managing Director
Place: Ballabgarh
Date: 30th May, 2011
Mar 31, 2010
The Directors are pleased to present the sixteenth Annual Report,
together with the audited accounts of your Company for the year ended
31st March, 2010.
FINANCIAL RESULTS
Financial Results of the Company for the year under review, along with
the figures for previous year
are as follows:
(Rs.in lac)
2009-10 2008-09
Gross Sales 43,783 44,783
Excise Duty 1,071 1,933
Net Sales 42,712 42,850
Other Income 687 1,871
Total Income 43,399 44,721
Profit before Depreciation
and Tax 3,802 3,590
Less:
Depreciation 525 574
Provision for Taxation 833 743
Net Profit after Tax 2,444 2,273
Profit brought forward 1,207 1,355
Profit available for Appropriation 3,651 3,628
Appropriations:
Interim Dividend 899 -
Dividend on Equity Shares - 359
Corporate Tax on Dividend 149 61
Amount transferred to
General Reserve 1,000 2,000
Profit carried to Balance Sheet 1,603 1.208
Note: Previous years figures have been regrouped wherever necessary.
FINANCIAL PERFORMANCE
The Companys performance is satisfactory, as overall figures represent
a good growth potential, going ahead. Although the figures of the
Financial year 2009-10 are more or less similar to the figures of the
financial year 2008-09, what is inspiring is the results for the last
quarter of the financial year 2009-10. The Companys profit before tax
for the last quarter is Rs. 13 crores, compared to an aggregate of Rs.
20 crores for the rest three quarters. These surely are good signs, as
the Indian economy is positioned for take-off following sluggish
growth. The Companys sales have also increased in all its equipment
categories. It intends to continue its journey towards sustainable
growth, which commenced in 1995.
The Companys gross sales stood at Rs. 43,783 lacs, marginally lower
from Rs. 44,783 lacs previous year. The net sales for the year ended
March 31, 2010 was Rs. 42,71 2 lacs, demonstrating a marginal drop from
Rs. 42,850 lacs for the year ended 31, 2009, on account of the impact
of the slowdown during the first half of the fiscal. The profit before
depreciation and tax stood at Rs. 3,802 lacs in 2009-10, as against Rs.
3,590 lacs in 2008-09. The profit after tax was Rs. 2,444 lacs in
2009-10, as against Rs. 2,273 lacs in 2008-09.
DIVIDEND
The Directors in its Board Meeting held on 6th April, 2010 has already
recommended an interim dividend of Rs. 1 (Rupees One) per equity share
for the financial year 2009-10.
The Board has refrained from recommending any final dividend in view of
future funding requirements for growth.
CHANGE IN SHARE CAPITAL
During the year, there was no change in the Companys share
capital.
LISTING
The shares of your Company are listed on the National Stock
Exchange of India Limited and the Bombay Stock Exchange.
CONSOLIDATED FINANCIAL STATEMENTS Your Company has a wholly-owned
overseas subsidiary (WOS) Company at Cyprus viz M/s FRESTED LIMITED,
and through it, your Company has acquired 89.50% equity stake in a
Romanian Company viz. SC FORMA SA, Romania. Your Company has also
formed a wholly-owned subsidiary company viz. Action Developers Ltd. As
per Section 4 of the Companies Act, 1956 all these three companies are
subsidiary companies of the Company. Therefore, in compliance of the
Listing Agreement with the Stock Exchanges and Accounting Standard
issued by The Institute of Chartered Accountants of India, your Company
has consolidated the accounts incorporating the accounts of all these
three subsidiary companies. The audited consolidated financial
statements together with Auditors Report thereon form a part of the
Annual Report.
RETURN ON NET WORTH
On the overall valuations of your Company, the Companys Net Worth is
Rs. 17083.52 lac as on 31st March, 2010, generating a Return on Net
worth (RONW) 14.31% and Return on Capital Employed (ROCE) of 12.25%,
both of which indicate good business returns.
MARKETING AND EXPORT AND SCALING UP OVERSEAS
BUSINESS
The Indian economy is in a take-off phase and has developed a necessary
strength to achieve the target of being a developed nation by 2020.
The Company plans to expand its overseas markets. It is looking at the
Middle East, Asia, Africa and Eastern Europe for its products.
With a view to enhance shareholder value, your Company continues to
focus on expanding its customer base through cost reduction, increased
efficiency and technology upgradation.
Your Companys confidence in building a positive future stems from the
continued and dedicated focus of its management team to maximise
customer satisfaction, growth in revenue, increased market penetration
and addition to the product portfolio. With a large and well-spread
network of 5 regional offices, 15 area offices and 85 sales and
services centers and dedicated spare parts division, along with a range
of products in its basket, your Company is well equipped to provide the
best products and parts, support and services to its increasing number
of customers. In 2009-10, your Company has introduced road- making
equipment like vibratory soil compactors and vibratory tandem rollers
Your Company is looking for expansion in international markets as well.
The Companys representatives are regularly making foreign visits to
explore acquisition possibilities. In addition to Cyprus and Romania,
where the Company has already formed its subsidiaries, your Company is
also looking at other viable and conducive locations.
On the domestic front, your Company is one of the major equipment
suppliers. It supplies equipment to very large groups (Reliance, L&T,
Simplex, Essar, NCC, IVRCL, Punj Lyod, BHEL and Gammon, among others,
who have faith in the Companys products).
Your Company intends to become "a one stop shop" for all possible
infrastructure construction, related to equipment in the forthcoming
years.
SUBSIDIARY COMPANIES
As mentioned earlier, your Company has incorporated a wholly- owned
overseas subsidiary (WOS) Company at Cyprus viz M/s FRESTED LIMITED,
and through it, your Company has acquired 89.5% equity stake in a
Romanian Company viz. SC FORMA SA, Romania, which has become fellow
subsidiary of your Company. Also, the Company has formed one more
subsidiary Company viz. Action Developers Ltd.
The Ministry of Company Affairs, Government of India, vide its letter
No. 47/387/2010 CL-III dated May 18, 2010 has exempted the Company from
attaching the Annual Report and other particulars of its subsidiary
companies along with the Annual Report of the Company u/s 212 of the
Companies Act, 1956, therefore, the said Reports of the subsidiary
companies viz. (1) FRESTED Limited, Cyprus, (2) SC FORMA SA, Romania
(3) Action Developers Limited are not attached herewith. However, a
statement giving certain information as required vide exemption letter
No. No. 47/387/2010 CL-III dated May 18, 2010 is placed along with the
Consolidated Accounts.
The annual accounts of the subsidiary companies and the related
detailed information will be made available to the members of the
holding and subsidiary Company seeking such information at any point of
time. The Annual Accounts of the subsidiary companies will also be kept
for inspection by any investor at its registered office.
QUALITY CERTIFICATION
Your Company has got CE Certification for most of its manufactured
products. After getting this certification, products of your Company
are being well accepted in the international market. Your Company is
already an ISO 9001 certified Company by CVI (Conformity Verification
International), which is internationally recognised for the production,
quality control and other qualities. This ensures that its standards of
design, development, procurement, manufacturing, testing, installation
and product support comply with the most stringent norms. The ISO
Certification gives international recognition, and will help the
Company boost its export turnover.
HUMAN RESOURCES & INDUSTRIAL RELATIONS FRONT
The industrial scenario, during the year 2009-10, remained harmonious
and cordial. There was no strike or lock-out during the year and as
such no person-days were lost. As on March 31, 2010, there were 631
employees on the Companys rolls.
Any shareholder interested in obtaining a copy of statement of
particulars of employees referred to in Section 217(2A) of the
Companies Act, 1956, may write to the Company Secretary at the
Registered Office of the Company.
The Companythisyearalso organised a cricket tournament, which was named
as ACE Premier League ("APL"). The tournament was a grand success with
majority of employees turning up to play and watch the tournament.
Eight teams were formed for the tournament from various plants and
offices of the Company.
ENVIORNMENT, HEALTH AND SAFETY FOR CORPORATE SUSTAINABILITY
Your Companys commitment and responsibility towards the environment
stems from its vision, which enjoins upon your Company to sustain
business growth with deep commitment to the environment. The safety and
health of its employees are embedded in the Companys core
organisational values. The policy, inter-alia, aims to ensure safety of
public, employees, plant and equipment, ensure compliance with all
statutory rules and regulations, impart training to its employees,
carry out safety audits of its facilities, conduct regular medical
check-up of its employees and promote eco-friendly activities.
CORPORATE SOCIAL RESPONSIBILITY
Your Company is committed to the belief that it exists not just to run
business and generate profits, but also to fulfill its duties as a
responsible corporate citizen. At ACE, we define the Corporate Social
Responsibility as "continuing commitment for operating the core
business in a socially responsible way, complemented by investment in
communities to produce an overall positive impact on the society". As a
caring corporate citizen, we paint various vibrant hues on the canvas
of life, each color in the palette coming alive with the bold brush
strokes of hope, harmony and happiness. The focus areas of your
Companys CSR activities
comprise: Environment Protection, Infrastructure, Drinking
water/Sanitation and Health/Medical facilities.
Your Company regularly conducts yoga training program for its
permanent, as well as contract employees. It is particularly cautious
of the health of its employees and aims at providing good basic
facilities and hygienic conditions to work for its employees.
ACE believes that a cleaner environment is a precious gift to the
upcoming generation. Your Company believes in planting trees in the
premises, as well as in nearby localities, reconciling environmental
priorities with corporate growth.
ACE expects to be involved in multiple social initiatives (child
education, environment protection, among others). The Company regularly
donates to educational institutions. It is well aware of its
responsibilities as a corporate citizen and strives for ways to drive
social initiatives.
DIRECTORS
Mr. Sorab Agarwal and Mr. Girish Narain Mehra, Directors are liable to
retire by rotation in ensuing Annual General Meeting and being eligible
offer themselves for re-appointment. Your Directors recommend for their
re-appointment. None of the Directors of your Company is disqualified
as per provisions of Section 274(1 )(g) of the Companies Act, 1956.
MANAGEMENT DISCUSSION AND ANALYSIS The Management Discussion and
Analysis of the financial condition and result of operations separately
form part of this report
AUDITORS OBSERVATIONS
Observations of the Auditors when read together with the relevant notes
on accounts and accounting policies are self-explanatory and do not
require any further comments.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance and Auditors Certificate regarding
compliance of conditions of Corporate Governance forms part of the
Annual Report.
AUDITORS
The Auditors of the Company, M/s. Rajan Chhabra & Co., Chartered
Accountants, will retire at the ensuing Annual General Meeting of the
Company. They are eligible for re-appointment and have furnished a
certificate to this effect that the proposed appointment, if made, will
be in accordance with Section 224 (1B) of the Companies Act, 1956.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the, provisions of Section 217 (2AA), your Directors hereby
confirm:
I) That in the preparation of the annual accounts, the applicable
Accounting Standards have been followed along with proper explanation
relating to material departures.
II) That thedirectors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent, so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit or loss of the Company for that period.
III) That the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities.
IV) That the directors had prepared the annual accounts on a going
concern basis.
INSURANCE
The assets of your Company are adequately insured against the losses by
fire and other risks as considered necessary by the management.
DEPOSITS
Your Company has not accepted any public deposit within the meaning of
the provisions of section 58A of the Companies Act, 1956.
RESEARCH AND DEVELOPMENT
Your Company is focussed on quality excellence. It has established an
in-house Research and Development Centre, which continuously carries
out research and developments, which can ultimately improve the quality
of products, making them more economical and user-friendly.
Your Company is also planning to submit an application with Govt, of
India for recognition of its In House Research and Development Centre
shortly. The detail of Initiatives taken by this In-house Research and
Development Centre are given in detail in Annexure-A
PARTICULARS ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND
FOREIGN EXCHANGE EARNING AND OUTGO
The information relating to the conservation of Energy, Technology
Absorption and Foreign Exchange Earning & Outgo required under Section
217 (1)(e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 are given in Annexure A and forms part of this report.
INTER-SE RELATIONSHIP BETWEEN DIRECTORS
As per Clause 49 of the Listing Agreement, your Company has to report
Inter-se relationship between the Directors in the Annual Report of the
Company. The following are the details of Inter-se relationship between
the Directors:-
- Mr. Vijay Agarwal, Chairman and Managing Director is husband of Mrs.
Mona Agarwal, Whole-time Director. and Father of Mr. Sorab Agarwal,
Executive Director of
the Company.
All other Directors of the Company, act in their
Independent capacities and do .. not have any inter-se relationship
among themselves.
ACKNOWLEDGEMENT
The Board of Directors wish to place on record their sincere
appreciation for the valuable services and dedicated efforts of the
employees of the. Company, who have ensured the accomplishment of good
results and achievements of the Company. The Board also wishes to thank
Government of India, various State Governments and the Companys Banker
for all the help and encouragement they extended to the Company. Your
Directors deeply acknowledge the continued trust and confidence that
the Shareholders, Customers, Dealers and Suppliers have placed in your
Company.
For and on behalf of the Board of
Action Construction Equipment Ltd.
Vijay Agarwal
Chairman & Managing Director
Place: Ballabgarh
Date: 27th May, 2010