Directors Report of Ador Welding Ltd.
Mar 31, 2022
The Directors take immense pleasure in presenting the Sixty Ninth (69th) Annual Report of the Company and the Audited Statements of Accounts for the financial year ended 31st March, 2022.
Your Company, Ador Welding Limited (AWL) was incorporated in the year 1951 and has come a long way to become one of India''s leading players in the welding industry. Your Company''s Vision is âCreating the Best Welding Experienceâ.
AWL has a huge spectrum of products offering and aims to provide "Complete Welding Solutions" to the "World of Manufacturing" for
enhancing their operational efficiency".
Our presence is there across seventy (70) odd countries and our corporate headquarter is based in Mumbai.
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2. |
FINANCIAL PERFORMANCE (Rs. in Lakhs) |
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Sr. No. |
Key Financial Indicators |
For the year ended 31st March, 2022 |
For the year ended 31st March, 2021 |
For the year ended 31st March, 2022 |
For the year ended 31st March, 2021 |
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|
Standalone |
Consolidated |
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|
2.1 |
Sales & Other Income (Net of GST, Discount & Incentives) |
66,689 |
45,459 |
66,696 |
45,507 |
|
|
2.2 |
Profit before exceptional items Interest, Depreciation, Tax & Other Comprehensive Income |
6,380 |
2,720 |
6,385 |
2,749 |
|
|
2.3 |
Exceptional items |
898 |
(2,537) |
898 |
(2,397) |
|
|
2.4 |
Profit before Tax (PBT) |
5,823 |
(1,568) |
5,821 |
(1,406) |
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|
2.5 |
Provision for Tax (Including Deferred Tax) |
1,304 |
(369) |
1,305 |
(368) |
|
|
2.6 |
Profit / (Loss) after Tax (PAT) |
4,519 |
(1,199) |
4,516 |
(1,038) |
|
|
2.7 |
Total Comprehensive Income (Loss) |
4,458 |
(1,147) |
4,455 |
(986) |
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The Board of Directors is pleased to recommend a Dividend of 125 % (i.e. @ Rs.12.50 per Equity Share) for the Financial Year (FY) 2021-22, subject to the approval of the Members.
The total amount of Dividend, to be disbursed for FY 2021-22, is Rs. 1,700 Lakhs, subject to applicable TDS. Further, the Dividend amount will be paid out of the profits of the Company.
The Dividend for FY 2021-22 shall be paid to those Shareholders and Beneficial Owners, whose
names appear in the Register of Members (RoM) as on the cut-off date for dividend payment.
The Board recommends transfer of 10 % of the Net Profit to General Reserve.
The dividend recommendation is in accordance with the Dividend Distribution Policy ("Policy") of the Company. The said policy is available on the website of your Company at https://www.adorwelding.com/wp-content/ uploads/2021/07/Dividend-Distribution-Policv.pdf
The paid-up Equity Share Capital as at 31st March, 2022 stood at Rs. 1,359.85 Lakhs. During the financial year under review, the Company has neither issued shares nor convertible securities nor shares with differential voting rights nor granted any stock options or sweat equity or warrants. As at 31st March, 2022, none of the Directors of the Company hold instruments convertible into Equity Shares of the Company.
During the year under review, there was no revision in the Credit Rating of the Company. The Rating Agency CARE maintained "A " (Single A Plus; Outlook: Stable) rating for the Company''s long term borrowings and "A1 " (A One Plus) rating for the Company''s short term borrowings.
As mandated by the Ministry of Corporate Affairs (MCA), the financial statements for the financial year ended 31st March, 2022 have been prepared in accordance with the Indian Accounting Standards (Ind AS), notified under Section 133 of the Companies Act, 2013 (hereinafter referred to as "the Act"), read with the Companies (Accounts) Rules, 2014, as amended from time to time. The estimates and judgements relating to the Financial Statements are made on a prudent basis, so as to reflect a true & fair form and substance of transactions and reasonably present the Company''s state of affairs, profits & cash flows for the financial year ended 31st March, 2022.
The Notes to the Financial Statements adequately cover the Standalone and Consolidated Audited Statements and form an integral part of this Report.
In FY 2021-22, the total Sales & Other Income increased by 47 % as compared to last FY 2020-21. The year ended with Sales & Other Income of Rs. 66,689 Lakhs. (Rs. 45,459 Lakhs)*.
The Company''s Net Sales and Other Income during FY 2021-22 comprised the following:
6.1 Welding Consumables at Rs. 53,540 Lakhs (Rs. 35,220 Lakhs)*
6.2 Equipment and Welding Automation at Rs. 9,854 Lakhs (Rs. 7,049 Lakhs)*
6.3 Project Engineering Business at Rs. 2,754 Lakhs (Rs. 2,459 Lakhs)*
6.4 Other Income of Rs. 541 Lakhs mainly comprised of forex gain, interest, rent & export incentives etc. (Rs. 731 Lakhs)*
(*Figures in brackets indicate previous year)
The Company incurred CAPEX of Rs. 1,315 Lakhs during FY 2021-22. The Capital work-in-progress as at 31st March, 2022 was Rs. 710 Lakhs. CAPEX planned for FY 2022-23 is Rs. 3,800 Lakhs, mainly for the following:-
a. Automation / modernization at Consumables and Equipment Plants.
b. Plant & Machinery for capacity expansion of certain products, and also for improvement of "productivity & in-process quality".
c. Replacement of Old Machineries.
d. Upgradation of R&D Infrastructure.
e. Information Technology (IT) upgradation, digitalization and Compliances.
f. Replacement of Vehicles.
8. PERFORMANCE OF THE SuBSIDIARY COMPANY
The Company does not have any material subsidiary. The Board of Directors of the Company has approved a Policy for determining material subsidiaries, which is in line with SEBI (LODR) Regulations 2015, as amended from time to time. The said Policy has been uploaded on the Company''s website at the following weblink:
https://www.adorwelding.com/wp-content/ uploads/2021 /07/Policy-for-determining-Material-Subsidiarv.pdf
Ador Welding Academy Private Limited (AWAPL)
The Board of Directors of AWAPL, at its meeting held on 28th May, 2021, considered and approved the scheme of amalgamation (merger by absorption) pursuant to Sections 230 to 232 read with Section 234 and other relevant provisions of the Companies Act, 2013, providing
for the merger of its wholly owned subsidiary, AWAPL (Transferor Company) with Ador Welding Limited (Transferee Company).
During the financial year under review, your Company has filed an application on 01st September, 2021 involving Composite Scheme of Arrangement of AWAPL with AWL before the Hon''ble National Company Law Tribunal, Mumbai Bench (''NCLT''). The scheme of amalgamation is subject to necessary statutory and regulatory approvals under applicable laws, including approval of the Hon''ble NCLT. Your Company has taken all the necessary statutory and regulatory approvals under applicable laws and is awaiting approval (final order) from Hon''ble NCLT. The scheme is at its final stage as on the date of this report.
During FY 2021-22, AWAPL registered a total revenue & other income of Rs. 6.87 Lakhs (Rs. 61.95 Lakhs), majorly because there was no operation undertaken directly by AWAPL, but all the activities were diverted / routed through the ''Welding Training Division'' of AWL, considering the ongoing process of amalgamation (merger by absorption). The loss (before exceptional items & tax) of Rs. 2.00 Lakhs (Profit before Tax of Rs. 20.37 Lakhs)*.
(*Figures in brackets indicate previous year)
9. CONSOLIDATED FINANCIAL STATEMENT
The Consolidated financial statements relate to M/s. Ador Welding Ltd. (AWL) and its wholly owned subsidiary, M/s. Ador Welding Academy Pvt. Ltd. (AWAPL). The consolidated financial statement of the Company and its subsidiary for FY 2021-22 are prepared in compliance with the applicable provisions of the Act and as stipulated under Regulation 33 of SEBI (LODR) Regulations, 2015 and in accordance with Section 1 36 of the Companies Act, 201 3 read with the Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015, as amended from time to time. The standalone financial statements of AWAPL are posted onto the website of the Company, which can be viewed at the following web link: https://www.adorwelding.com/wp-content/uploads/2022/05/AWAPL-Financial-Statements-31.03.2022.pdf - and hence, the same are not annexed to this 69th Annual Report.
The Annual Accounts and other related information of the said Subsidiary Company will also be made available to the shareholders of the Holding Company (AWL). The Annual Accounts of the Subsidiary Company are also available for e-inspection to the shareholders of AWL and your Company shall furnish a physical copy of annual accounts of Subsidiary to any shareholder of the Company, on request.
Pursuant to Section 1 29(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Subsidiaries / Associate Companies / Joint Ventures is given in Form AOC-1, which forms an integral part of this Report.
Given the diversified scale of operations, your Company has formulated an Enterprise Risk Management (ERM) framework to manage various financial & non-financial risks, operational & non-operational risks, amongst other risks. The Board takes responsibility of the overall process of risk management throughout the organization.
The ERM Policy of the Company helps to continuously assess & monitor the risks assumed by the Company. The processes are in place for identifying, evaluating and managing the risks. Based on the ERM Policy, the Board hereby states that there are no elements of risks, which threaten the existence of the Company.
Further, since your Company falls under "Top 1000 Companies", based on market capitalization, as on 31st March, 2021, a Risk Management Committee is constituted in FY 2021-22 to oversee implementation of the Risk Management Policy, to monitor & evaluate risks, basis appropriate methodology, processes & systems and to keep the Board of Directors informed and recommend the actions to be taken.
11. RELATED PARTY TRANSACTIONS (RPTs)
The Policy on Related Party Transactions (RPTs) is reviewed by the Audit Committee & approved by the Board of Directors in a timely manner and as & when necessary. The said policy is uploaded
on the Company''s website at the following web link: https://www.adorwelding.com/wp-content/ uploads/2022/05/RPT-Materialitv-Policv-2022-23. pdf
During FY 2021-22, the Company entered into certain Related Party Transactions, in the ordinary course of business and on arm''s length basis, with prior approval of the Audit Committee. Omnibus approvals are obtained on a quarterly basis for all the transactions, which are foreseeable & repetitive in nature and the details of all related party transactions are placed before the Audit Committee and the Board for review & approval on a quarterly basis.
There were no material related party transactions (RPTs) undertaken by the Company during the financial year under review, that required shareholders'' approval under Regulation 23(4) of SEBI (LODR) Regulations, 2015 or Section 188 of the Companies Act, 2013.
All transactions entered with the Related Parties for the financial year under review were on arm''s length basis and were not material. Hence, disclosure pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is not required. Further, there are no materially significant Related Party Transactions executed between the Company & its Promoters, Directors, Key Managerial Personnels or other designated persons, that may have a potential conflict with the interest of the Company, at large.
None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company, except remuneration, sitting fees and reimbursement of expenses, to the extent applicable. All Related Party Transactions are mentioned in the notes to accounts. The Company has developed a framework through Standard Operating Procedures (SOPs), for the purpose of identification and monitoring of such Related Party Transactions.
Pursuant to Sections 92 & 134(3) of the Act, the draft of Annual Return for FY 2021-22 in e - form MGT-7 is available on the Company''s website: https://www.adorwelding.com/wp-content/ uploads/2022/07/Draft-MGT-7.pdf
13. CORPORATE SOCIAL RESPONSIBILITY (CSR)
Under the "Corporate Social Responsibility" (CSR) drive, the Company has spent an amount of Rs. 47.45 Lakhs during FY 2021-22, out of its budgeted annual CSR expenditure of Rs. 47.36 Lakhs & has spent Rs. 6.17 Lakhs, out of Rs. 10.50 Lakhs parked in the Unspent Corporate Social Responsibility Account (UCSR) for an "Ongoing Project". The various projects / initiatives undertaken by the Company were in the following areas:
a. Promoting education among children, women, elderly and differently abled, including special education & employment enhancing vocational skills, especially skill development and encouraging safety practices in welding & allied fields for economically challenged / financially weaker sections of the Society
b. Empowering women towards individual and professional development opportunities
c. Promoting healthcare, sanitation, hygiene & making available safe drinking water to the non-privileged / underprivileged.
Your Company also performed its social duties by contributing towards the COVID-19 prevention initiatives. Your Company contributed significantly towards the initiative of "Mission Oxygen helping Hospitals save lives", which helped in procuring and donating oxygen concentrators, supplementing hospital infrastructure with oxygenation plants and other lifesaving equipments in the second wave of the pandemic.
Your Company understands its duties towards the society and considers social responsibility as an integral part of its operations. Your Company tries to ensure that its CSR initiatives have a meaningful impact on the society at large & that the contribution made by it reaches the beneficiary at the earliest, with the aim to create a long-term positive impact.
The Company is committed to continuously explore new opportunities, in alignment with its CSR philosophy & policy and strives to create a positive impact on the society, through its CSR initiatives.
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out, in a format prescribed in the Companies (CSR Policy) Rules, 2014, as amended from time to time, in Annexure - I to this Report. The CSR Policy is also available on Company''s website at URL: https://www.adorweldina.com/wp-content/ uploads/2021/08/CSR-Policv-FY-2021-22.pdf
The composition of the CSR Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - I.
14. LOANS, GUARANTEES & INVESTMENTS
The details of Loans, Guarantees & Investments, covered under the provisions of Section 186 of the Companies Act, 2013, are given in the notes to the Financial Statements, forming part of this Annual Report.
Your Company had no opening balances of fixed deposits. Further, the Company has not accepted or renewed any deposits, within the meaning of Section 73 of the Companies Act 2013, read with the Companies (Acceptance of Deposits) Rules, 2014.
16. SECRETARIAL STANDARDS (SS)
Your Company has complied with all the applicable Secretarial Standards (SS), issued by the Institute of Company Secretaries of India (ICSI), from time to time.
All the properties / assets of the Company are adequately insured.
18. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE
The information required under Section 1 34(3) (m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 with respect to the conservation of energy, technology absorption & foreign exchange earnings / outgo is appended hereto as Annexure - II.
As per the Listing Agreements executed with the Stock Exchanges, the Company has been following the Corporate Governance Code since FY 2001-02. Your Company has complied with all the requirements of Good Corporate Governance for the period 01st April, 2021 to 31st March, 2022 (i.e. FY 2021-22) pursuant to Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. As per Regulation 34(3) read with Schedule V to SEBI (LODR) Regulations, 2015, a separate section on corporate governance practices followed by the Company, together with Corporate Governance Compliance Certificate received from M/s. Walker Chandiok & Co. LLP Chartered Accountants, Statutory Auditors of the Company, confirming compliance forming an integral part of this Report is attached hereto as Annexure - III.
The Management Discussion and Analysis (MDA) Report, as mandated under Schedule V to SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, is also attached to this Report as Annexure - IV.
20. SIGNIFICANT & MATERIAL REGuLATORY ORDERS
During FY 2021-22, there were no significant orders passed against the Company by any regulators or courts or tribunals, impacting the going concern status and the Company''s operations, in future. However, Members attention is drawn to the Statement on Contingent Liabilities and Commitments in the Notes, forming part of the Financial Statement.
21. NOMINATION, REMuNERATION & BOARD DIVERSITY POLICY
The Board of Directors has framed a policy, on the recommendation of the Nomination & Remuneration Committee, which lays down a framework in relation to appointment and remuneration of its Directors. The Policy includes criteria for determining qualifications, positive attributes, independence of Director etc., as required under the provisions of Section 178(3) of the Companies Act, 2013 and SEBI (LODR) Regulations 2015. The Policy also broadly lays down the guiding principles, philosophy and
the basis for payment of remuneration to the Executive & Non-Executive Directors. The said policy has been posted on the website of the Company at https://www.adorwelding.com/wp-content/uploads/2021/07/criteria_for_payment_ to_NEDs.pdf
In case of re-appointment of Non-Executive & Independent Directors, NRC and the Board takes into consideration the performance of the Director, based on the Board evaluation and his / her engagement level during his / her previous tenure.
The details of the Remuneration Policy for Directors, are explained in the Corporate Governance Report, attached hereto as Annexure - III.
All the Independent Directors of the Company have given declarations under Section 149(7) of the Act, stating that they meet the criteria of independence, as laid down under Section 149(6) of the Act and Regulation 16(1)(b) of SEBI (LODR) Regulations, 2015. In terms of Regulation 25(8) of SEBI (LODR) Regulations, 2015, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgement and without any external influence. They have also given declaration under Rule 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, that their names are registered in the databank, as maintained by the Indian Institute of Corporate Affairs (IICA).
Pursuant to Rule 8(5)(iii)(a) of the Companies (Accounts) Rules, 2014, in the opinion of the Board, the Independent Directors are competent, experienced and are the persons of expertise (including the proficiency), having positive attribute, standards of integrity, ethical behaviour, qualifications & independent judgement.
Your Company has in all 5 (five) Independent Directors, including 01 (one) Woman Independent Director, as on 31st March, 2022. The Independent Directors met on 10th February, 2022, without the presence of Non-Independent Directors and Members of the Management,
as required under SEBI (LODR) Regulations, 2015 and the Companies Act 2013, to discuss on various important matters & evaluate the working / operations of the Management (Whole-Time Directors & KMPs).
23. DIRECTORS & KEY MANAGERIAL PERSONNEL
During FY 2021-22 the following changes occurred in the composition of the Board of Directors of the Company:
a) Mrs. Ninotchka Malkani Nagpal (DIN: 00031985) was re-appointed as the Whole-Time Director designated as Executive Chairman for a further period of 03 (three) years with effect from 07th May, 2021 upto 06th May, 2024 and her re-appointment was approved by the Members by way of Special Resolution at 68th Annual General Meeting.
b) Dr. Deep A. Lalvani (DIN: 01771000) resigned from the office of the Whole-Time Director on 31st March, 2022 and was re-designated as the Non-Executive Director w.e.f. 01st April, 2022.
c) In accordance with the provisions of Section 152 of the Act and the Company''s Articles of Association (AoA), Dr. Deep A. Lalvani (DIN: 01771000), Non-Executive Director, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment. The Board recommends his re-appointment for consideration of the Members of the Company at the forthcoming Annual General Meeting. Brief profile of Dr. Deep A. Lalvani has been given in the Notice convening the 69th Annual General Meeting.
d) Subsequent to the end of the financial year, the Board of Directors, on the recommendation of the Nomination & Remuneration Committee appointed Mr. Navroze S. Marshall (DIN: 00085754) as an Additional Director (Non- Executive & Independent) with effect from 21 st May, 2022. In terms of Section 161 of the Act, Mr. Navroze S. Marshall holds office up to the date of ensuing Annual General Meeting. The Company has received requisite notice in writing from a Member proposing his name for the office of Director. The
with the provisions of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A structured questionnaire was prepared after taking into consideration various aspects of the Board''s functioning, composition of the Board & of its Committees, execution & performance of specific duties, obligations & governance. The performance evaluation of the Board of its own performance & that of its Committees and individual Directors, including the Executive Chairman and the Independent Directors was completed during the year under review. The Board of Directors expressed their satisfaction with the evaluation process.
The manner of evaluation has been explained in the Corporate Governance Report in Annexure - III.
25. DIRECTORS RESONSIBILITY STATEMENT
Pursuant to Sections 134(3)(c) & (5) of the Companies Act, 201 3, the Board of Directors of the Company, to the best of their knowledge and ability, hereby confirm that:
a) in preparation of the Annual Accounts for FY 2021-22, all the applicable Accounting Standards (AS) have been followed, along with proper explanation relating to material departures, if any;
b) the Directors have selected such accounting policies & practices and applied them consistently & made judgments and estimates that are reasonable and prudent, so as to give a true & fair view of the state of affairs of the Company and of the profits of the Company for the year ended 31st March, 2022;
c) the Directors have 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 & detecting fraud and other irregularities;
d) the Directors have prepared the Annual Accounts on a going concern basis;
e) the Directors have laid down internal financial controls, to be followed by the Company and that such internal financial controls are adequate & were operating effectively; and
Board recommends the appointment of Mr. Navroze S. Marshall as a Non-Executive & Independent Director, for the approval by the Members of the Company. Brief profile of Mr. Navroze S. Marshall is given in the Notice convening 69th Annual General Meeting.
In the opinion of the Board, Mr. Navroze S. Marshall satisfies the conditions specified in SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013 along with the rules made thereunder, for his appointment as an Independent Director of the Company and he is independent of the Management. The Board believes that his association would be of immense benefit to the Company and it is desirable to avail his services as an Independent Director for the first term of 05 (five) consecutive years. He shall not be liable to retire by rotation. In the interest of the Company''s continued prosperity and well-being, the Board recommends his appointment as an Independent Director at the ensuing Annual General Meeting.
e) The abovenamed Directors have submitted Form DIR-8, pursuant to Section 164 of the Companies Act, 2013 & Rule 14(1) of the Companies (Appointment & Qualification of Directors) Rules, 2014, along with their consent in Form DIR-2 pursuant to Section 152 of the Companies Act, 2013 & Rule 8 of the Companies (Appointment & Qualification of Directors) Rules, 2014.
f) Necessary Resolutions for the appointment / re-appointment / re-designation of the abovenamed Directors have been included in the Notice convening the ensuing 69th Annual General Meeting and details of the proposed appointees, as required pursuant to Regulation 36 of SEBI (LODR) Regulations, 2015 and Clause 1.2.5 of the Secretarial Standard-2 (SS-2), are given in the Appendix to the Explanatory Statement annexed to the said Notice.
24. DIRECTORS PERFORMANCE EVALUATION
The annual evaluation process of the Board of
Directors, individual Directors and Committees
of the Directors was conducted in accordance
f) the Directors have devised proper systems to ensure compliance with the provisions of all the applicable laws and that such systems were adequate & operating effectively.
26. BUSINESS RESPONSIBILITY REPORT
Pursuant to Regulation 34(2)(f) of SEBI (LODR) Regulations, 2015, the Business Responsibility Report (BRR), on the initiatives taken from environmental, social and governance perspective, in the prescribed format, is annexed as Annexure VII and forms an integral part of this Report.
27. AuDIT COMMITTEE & ITS RECOMMENDATIONS
The composition of the Audit Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - III.
The Audit Committee plays a key role in providing assurance about financial statements to the Board of Directors. Significant audit observations, if any, and corresponding corrective actions taken by the Management are presented to the Audit Committee.
The Board has accepted all the
recommendations of the Audit Committee and hence, there is no further explanation to be provided for, in this Report.
28. NuMBER OF BOARD MEETINGS
The Company has conducted 04 (four)
Board meetings during FY 2021-22 and the details thereof are covered in the Corporate Governance Report, which is annexed to this Report as Annexure - III.
29. COMMITTEES OF THE BOARD
The Committees of the Board focus on certain specific areas and make informed decisions in line with the delegated authority / charter.
The following Committees, constituted by the Board, function according to their respective roles and defined scope / charter:
a) Audit Committee (AC)
b) Stakeholders'' Relationship Committee (SRC)
c) Nomination and Remuneration Committee (NRC)
d) Corporate Social Responsibility Committee (CSR)
e) Risk Management Committee (RMC)
The following are the Key Managerial Personnel (KMPs) of the Company as on 31st March, 2022:
a) Mr. Aditya T. Malkani, Managing Director
b) Mr. Vinayak M. Bhide, Company Secretary & Compliance Officer
c) Mr. Surya Kant Sethia, Chief Financial Officer
31. statutory auditors
M/s. Walker Chandiok & Co. LLP, Chartered Accountants, (FRN: 001076N / N500013), Mumbai, were re-appointed as the Statutory Auditors of the Company for a second term of 5 (five) consecutive years at the 67th Annual General Meeting (AGM) of the Members held on 22nd September, 2020, i.e. until the conclusion of the 72nd Annual General Meeting, on such remuneration, as mutually agreed upon by the Board of Directors and the Statutory Auditors.
32. STATuTORY AuDITORâS REPORT
The Report of the Statutory Auditor, forming part of the Annual Report, does not contain any qualification, reservation, adverse remark or disclaimer. The observations made in the Auditor''s Report are self-explanatory and therefore do not call for any further comments / explanations.
33. SECRETARIAL AuDITOR & ITS REPORT
Pursuant to the provisions of Section 204 of the Companies Act, 201 3 and the rules made thereunder, the Board of Directors had appointed M/s. N. L. Bhatia & Associates, (Unique Identification Number: P1996MH055800), a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company for FY 2021-22.
The Secretarial Audit Report is annexed herewith as Annexure - V. There are no qualifications in the said Report and therefore no explanations are provided in this Report.
34. COST AUDITOR
Pursuant to the provisions of Section 148 of the Companies Act, 2013, the Board of Directors, on the recommendation of the Audit Committee, had appointed M/s. Kishore Bhatia & Associates, Cost Accountants, Mumbai, as the Cost Auditor of the Company for FY 2021-22.
The brief information of the Cost Auditor and the Cost Audit Report is as under:
a) Name of the Cost Auditor: M/s. Kishore Bhatia & Associates
b) Address: 701/702, D-Wing, Neelkanth Business Park, Nathani Road, Vidhyavihar (West), Mumbai - 400 086, Maharashtra, India.
c) Membership No.: 31166
d) Firm Registration No.: 00294
e) Due date of submitting Cost Audit Report for FY 2020-21 by the Cost Auditor with the Company: Within 180 days from the end of the financial year (by 30th September, 2021)
f) Actual Date of filing of Cost Audit Report for FY 2020-21 with the Central Government: 10th August, 2021
The Company has appointed M/s. Kishore Bhatia & Associates, Cost Accountants, Mumbai (Firm Registration No. 00294) as the Cost Auditors for the financial year 2022-23 as well. M/s. Kishore Bhatia & Associates have, under Rule 6(1 A) of the Companies (Cost Records and Audit) Rules,
2014, furnished a certificate of their eligibility and consent for the said appointment. As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor for FY 2022-23 is being placed before the Members at the ensuing Annual General Meeting, for ratification.
The cost records of the Company, as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act 2013, are duly prepared & maintained by the Company.
35. VIGIL MECHANISM & WHISTLE BLOWER POLICY
Pursuant to Section 177(9) of the Act and Regulation 4(2)(d)(iv) of SEBI (LODR) Regulations,
2015, the Company has framed a policy on Vigil Mechanism - cum - Whistle Blower, which
enables any Director, Employee & Stakeholder of the Company to report their genuine concerns / instances of any unethical / improper activity, directly to the Chairman of the Audit Committee, as a Protected Disclosure. The policy also provides adequate safeguards against victimization of persons, who may use such mechanism.
The detailed policy is also posted on the Company''s Intranet Portal "SANVAD" and also onto its website at the following weblink: https://www.adorwelding.com/wp-content/ uploads/2021/07/Mechanism-For-Whistle-Blower-For-Stakeholders11.pdf
36. POLICY ON PREVENTION OF SEXuAL HARASSMENT
The Company has "zero tolerance" for sexual harassment at workplace and has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) under "The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013", as amended from time to time, which looks into the complaints received, if any. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company''s office / factory premises and women service providers are covered under this Policy. AWL is committed to creating a safe and healthy work environment, where every employee is treated with respect and is able to work without any fear of discrimination, prejudice, gender bias, or any form of harassment at workplace.
Further, there were no complaints received by the Committee during the financial year 202122. The Company has also adopted a policy under the said Act, which is placed on its internal portal as well as on the website of the Company, which can be viewed at the following weblink: https://www.adorwelding.com/wp-content/ uploads/2022/02/PQSH-Policv_2022-1.pdf
37. TRANSFER OF uNCLAIMED DIVIDEND TO INVESTOR EDuCATION & PROTECTION FuND
Pursuant to Sections 124 and 125 of the Companies Act, 201 3 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), as amended from time to time, dividends, if not claimed within / for a period
of 07 (seven) years from the date of transfer to the Unpaid Dividend Account of the Company, are liable to be transferred to the Investor Education and Protection Fund ("IEPF"). Furthermore, IEPF Rules mandate the Companies, to transfer shares of the Members, whose dividends remain unpaid / unclaimed for a period of 07 (seven) consecutive years to the demat account of IEPF Authority. The said requirement does not apply to shares, in respect of which there is specific order of the Court, Tribunal or Statutory Authority, restraining any transfer of shares.
In the light of the aforesaid provisions, the Company has, during the financial year 2021-22 under review, transferred to IEPF, the unclaimed dividend of Rs. 17,01,855/- pertaining to FY 201314. Further, 20,567 equity shares of the Company, in respect of which dividends were not claimed for 07 (seven) consecutive years or more, have also been transferred to the demat account of IEPF Authority. The details of the transfer of unclaimed dividend to the Investor Education and Protection Fund ("IEPF") are provided in detail in the Corporate Governance Report, annexed as Annexure III to this report.
The Members, may claim dividends and / or shares from IEPF Authority, by submitting an online application in the prescribed electronic Form IEPF-5, available on the website www.iepf.gov.in and subsequently send a physical copy of the e-form along with its acknowledgement, duly signed, to the Company along with the requisite documents enumerated in the said eform IEPF-5. No claims shall lie against the Company, in respect of the dividend / shares, so transferred. Members may also kindly refer to the Refund Procedure for claiming the aforementioned amounts & shares transferred to the IEPF Authority, as detailed / given on www.iepf.gov.in
Whilst the Company has already written to the Members, informing them about the due date for transfer of shares to IEPF, the attention of the shareholders is once again drawn to this matter through the Annual Report. The data on unpaid / unclaimed dividend and shares is also available on the Company''s website at www.adorwelding.com. Investors, who have not yet encashed their unclaimed / unpaid dividend amounts are requested to correspond with the
Company''s Registrar and Share Transfer Agent, at the earliest. Those Members / Shareholders, who do not remember / recollect having encashed their dividend, can also check the "List of Unpaid Dividends" on the website of the Company.
38. HUMAN RESOURCE (EMPLOYEES)
At AWL, employee well-being is of utmost importance. The Company has a structured induction process at all its locations and undertakes training programs to upgrade skills / knowledge of its employees. Objective appraisal systems, based on key result areas (KRAs), are in place for its employees. AWL believes in harnessing the potential of the employees, by providing them adequate training, opportunities and inclusive work culture, in order to achieve Company''s goal, in line with the overall employee development. The industrial relations at all the Plants and Offices of the Company continue to remain harmonious, cordial and peaceful.
During the financial year under review, special pay-outs were made / given / disbursed to all off-roll / Casuals, AWL contract and "on-roll" employees, on the 70th anniversary of your Company. Such initiatives are great motivation / boaster for the employees as well as small token of appreciation for the efforts of the employees in the overall growth & development of your Company.
Disclosure 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 is annexed to this Report, as Annexure VI.
Statement containing particulars of top 1 0 employees and the employees drawing remuneration in excess of limits prescribed under Section 197 (12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, if any, is provided in the Annexure forming part of this report. In terms of proviso to Section 136(1) of the Act, the Report and Accounts are being sent to the shareholders, excluding the aforesaid Annexure. The said Statement is also open for e-inspection / physical inspection, 21 (twenty one) days before and up to the date of the ensuing 69th Annual General Meeting, during
the business hours on working days. Any Member interested in obtaining a copy of the same may write to the Company Secretary. None of the employees, listed in the said Annexure, are related to any of the Directors of the Company or to each other. None of the employees hold (by himself / herself or along with his / her spouse and dependent children) more than 02% (two percent) of the Equity Shares of the Company.
The on-roll manpower strength of the Company, as at the date of this Report, is 535.
39. MATERIAL CHANGES & COMMITMENTS
There were no material changes affecting the financial position of the Company subsequent to the close of the financial year 2021-22, till 20th May, 2022 i.e. the date of this report, except appointment of an Independent Director, subject to the approval of the Shareholders.
40. INTERNAL FINANCIAL CONTROL SYSTEM & THEIR ADEQUACY
The Board has adopted policies & procedures of governance for orderly and efficient conduct of its business, including adherence to the Company''s policies, safeguarding its assets, prevention & detection of frauds and errors, accuracy & completeness of the accounting records and timely preparation of reliable financial disclosures. AWL has an effective internal control system, which is constantly assessed and strengthened. The Company''s financial internal control systems are commensurate with the nature of its business, the size and complexity of its operations.
The Internal Auditor reports to the Audit Committee. The Audit committee defines the scope and authority of the Internal Auditor. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of the Internal Auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and the corresponding corrective actions are thereafter presented to the Audit Committee on quarterly basis and as & when required.
There were no instances of fraud, during the financial year 2021-22, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of the Act and Rules framed thereunder.
42. PREVENTION OF INSIDER TRADING CODE
Your Company has adopted the Code of Conduct for Prevention of Insider Trading (PIT) for dealing / trading in the Securities of the Company, in accordance with the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018. The Code of Conduct for Prevention of Insider Trading & Code of Corporate Disclosure Practices is also uploaded on the website of the Company at the following weblink: https://www.adorwelding. com/wp-content/uploads/2021/10/Code-of-Practices-and-Procedures-for-Fair-Disclosure-of-Unpublished-Pric....pdf
All the Directors, employees and third parties such as auditors, consultants etc. who could have access to the Unpublished Price Sensitive Information (UPSI) of the Company are governed by this code. The objective of the PIT Code is to protect the interest of the shareholders at large, to prevent misuse of any unpublished price sensitive information and to prevent any insider trading activity by / while dealing in shares of the Company by its Designated Persons and their immediate relatives. The trading window is closed during the time of declaration of results and occurrence of any material events, as per the Code. The Company Secretary & Compliance Officer, is responsible for setting forth procedures and implementation of the Code for trading in the Company''s securities.
Your Company is conscious of the importance of environmentally clean and safe operations. AWL has undertaken various initiatives, which contribute towards sustainable development. Your Company strives to operate, after taking into consideration various environmental, social and governance initiatives / guidelines / laws, in order to achieve maximum output by optimum utilization of available resources, in environment friendly manner / ways.
The Company affirms that the annual listing fees for the financial year 2022-23 have been paid to both M/s. National Stock Exchange of India Limited (NSE) and M/s. BSE Limited (Bombay Stock Exchange).
Your Company has also paid its annual custodial fees to M/s. National Securities Depository Limited (NSDL) and M/s. Central Depository Services (India) Limited (CDSL).
Your Directors take this opportunity to place on record their sincere gratitude and warm appreciation for the invaluable contribution and spirit of dedication shown by the employees, including the support staff, at all levels during
FY 2021-22. Your Directors also express their deep gratitude for the business assistance, co-operation and support extended to your Company by its Customers, Distributors, Dealers, Suppliers, Service Providers, Bankers, various Government Organizations / Agencies & the Shareholders and look forward to their continued support and co-operation in the future, as well.
For and on behalf of the Board
Ninotchka Malkani Nagpal Executive Chairman (DIN: 00031985)
Place: Mumbai Date: 20th May, 2022
Mar 31, 2018
To,
The Members,
The Directors take pleasure in presenting the Sixty Fifth Annual Report of the Company and the Audited Statements of Accounts for the financial year ended 31st March, 2018.
1.0 FINANCIAL PERFORMANCE
(Rs. in Lakhs)
|
Sr. |
Key Financial Indicators |
For the |
For the |
For the |
For the |
|
No. |
year ended |
year ended |
year ended |
year ended |
|
|
31s1 March 2018 |
31 st March 2017 |
31s1 March 2018 |
31st March 2017 |
||
|
Standalone |
Consolidated |
||||
|
1.1 |
Sales & Other Income |
46,745 |
45,083 |
46,791 |
45,157 |
|
1.2 |
(Net of Excise Duty, Discounts & Incentives) Profit before Interest, Depreciation,Tax & Other Comprehensive Income |
4,363 |
3,946 |
4,359 |
3,930 |
|
1.3 |
(OCI) Profit before Tax & before OCI |
2,825 |
2,720 |
2,810 |
2,689 |
|
1.4 |
Provision for Tax (including Deferred Tax) |
969 |
908 |
969 |
904 |
|
1.5 |
Profit after Tax & before OCI |
1,856 |
1,812 |
1,841 |
1,785 |
|
1.6 |
Profit after Tax (PAT) & after OCI |
1,849 |
1,815 |
1,834 |
1,788 |
2.0 DIVIDEND AND RESERVES
2.1 The Board of Directors is pleased to recommend a Dividend of 50% (i.e. @ Rs.5/- per Equity Share) for the Financial Year (FY) 2017-18, subject to the approval of the Members. Dividend for the previous FY 2016-17 was declared @ 50% (i.e. @ Rs. 5/- per Equity Share)*.
2.2 The Dividend for FY 2017-18 shall be paid to those Shareholders and Beneficial Owners whose names appear in the Register of Members as on the cut-off date for dividend payment.
2.3 The Board recommends transfer of Rs. 186 Lakhs (Rs. 187 Lakhs)* to General Reserve.
(*Figures in brackets indicate previous year)
3.0 OPERATIONS
In FY 2017-18, the total Sales and Other Income went up by 3.70%. The year ended with Sales and Other Income of Rs. 46,745 Lakhs (Rs. 45,083 Lakhs)*.
The Companyâs net Sales and Other Income during FY 2017-18 comprised of the following:
3.1 Welding Consumables at Rs. 30,585 Lakhs (Rs. 28,318 Lakhs)*
3.2 Equipment & Project Engineering at Rs.15,189 Lakhs (Rs.15,827 Lakhs)*
3.3 Other Income of Rs. 971 Lakhs mainly comprised of FOREX gain, interest, rent & export incentives etc. (Rs.938 Lakhs)*
(*Figures in brackets indicate previous year).
4.0 CAPEX
The Company incurred CAPEX of Rs. 1,170 Lakhs during the Financial Year 2017 - 18. The Capital work -in - progress as at 31st March, 2018 was Rs. 77 Lakhs. CAPEX planned for FY 2018 - 19 is Rs. 2,119 Lakhs, mainly for the following:-
(a) Automation / mordenisation at Consumables and Equipment Plants.
(b) Plant and Machinery for capacity expansion of certain products, and also for improvement of âproductivity and in process qualityâ and reduction in process loss.
(c) Replacement of Old Machinery.
(d) Analytical Instruments for R&D.
(e) IT Compliances.
(f) Solar power plant.
5.0 SUBSIDIARY COMPANY Ador Welding Academy Pvt. Ltd. (AWAPL)
AWAPL, a Wholly Owned Subsidiary of the Company, focuses on creating a pool of skilled welding technicians and professionals to serve a cross-section of industries in the infrastructure sector and also renders consulting services to corporates on setting up / improving their welding processes. AWAPL registered a total revenue of Rs. 73.72 Lakhs (Rs. 103.36 Lakhs)*, with a net loss (before exceptional items & tax) of Rs. 14.67 Lakhs (Rs. 30.82 Lakhs)*.
(*Figures in brackets indicate previous year)
6.0 CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated financial statements relate to Ador Welding Ltd. and its wholly owned subsidiary, Ador Welding Academy Pvt. Ltd. These consolidated financial statements are prepared in compliance with all the applicable Accounting Standards. The standalone financial statements of AWAPL are posted onto the website of the Company at the weblink below:
http://www.adorwelding.com/images/pdf/AWAPL-Financials-FY-2017-18-1.pdf
Hence the same are not annexed with this 65th Annual Report. The Annual Accounts and other related information of the said Subsidiary Company will also be made available to the shareholders of the Holding Company. The Annual Accounts of the Subsidiary Company are available for inspection to the shareholders at the registered office of the Company and your Company shall furnish a physical copy of accounts of subsidiary to any shareholder of the Company, on request.
7.0 RISK MANAGEMENT
Your Company has formulated an Enterprise Risk Management (ERM) framework, to manage various financial & non-financial risks, and also operational & non - operational risks amongst other things.
The Company has also adopted ERM Policy, which helps to continuously assess & monitor the risks assumed by the Company. The processes are in place for identifying, evaluating and managing the risks. Based on the ERM Policy, the Board further states that there are no elements of risks, which threaten the existence of the Company
8.0 RELATED PARTY TRANSACTIONS
The Policy on Related Party Transactions is approved by the Board of Directors and the same is uploaded on the Companyâs website:
http://www.adorwelding.com/images/pdf/corporate_policies/RPT_policy.pdf
During FY 2017-18, the Company entered into certain Related Party Transactions, in the ordinary course of business and on arms length basis, with prior approval of the Audit Committee. The Audit Committee grants omnibus approval for the transactions with the related parties, which are foreseen & repetitive in nature. A detailed summary of Related Party Transactions vis-a-vis the omnibus approval is placed before the Audit Committee for its review on a quarterly basis.
There are no materially significant Related Party Transactions executed between the Company & its Promoters, Directors, Key Managerial Personnel or other designated persons, that may have a potential conflict with the interest of the Company at large. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.
9.0 EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(2) and 134(3)(a) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return is appended hereto as Annexure - I, and forms part of this Report.
10.0 CORPORATE SOCIAL RESPONSIBILITY (CSR)
As part of its CSR initiatives, the Company spent Rs. 32.87 Lakhs during FY 2017-18 out of the budgeted CSR expenditure of Rs. 58.43 Lakhs, on various projects in the following areas:
- Promoting Health Care Including Preventive & Mental Health Care
- Vocational Training for poor & needy.
- Promoting education for underprivileged women.
The said CSR projects are in accordance with Schedule VII to the Companies Act, 2013. The Company considers social responsibility as an integral part of its activities and endeavors to utilize allocable CSR budget for the benefit of society. An unspent amount of Rs. 25.56 Lakhs was recorded by the Company at the end of the financial year ended 31st March, 2018, as it could not conclude appropriate propositions / projects which could have created an impact on the well being of the community, especially in the Governmentâs initiative of âUpskilling Indiaâ. The Company is, nevertheless, committed to continually explore new opportunities, in alignment with its CSR philosophy & policy, to spend the prescribed CSR amount in the subsequent years.
The Annual Report on CSR activities is annexed hereto as Annexure - II.
The composition of the CSR Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV.
11.0 LOANS & GUARANTEES
The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements
12.0 FIXED DEPOSITS
The Company has neither accepted nor renewed Fixed Deposits during FY 2017-18 and FY 2016-17.
13.0 INSURANCE
The properties / assets of the Company are adequately insured.
14.0 ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE
The information required under Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption & foreign exchange earnings / outgo is appended hereto as Annexure - III.
15.0 CORPORATE GOVERNANCE
As per the Listing Agreements executed with the Stock Exchanges, the Company has been following the Corporate Governance Code from FY 2001-02 onwards. The Company has complied with all the requirements of the Corporate Governance as per the Listing Agreement executed with the Stock Exchanges for the period 01st April, 2017 to 31st March, 2018 pursuant to Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and a separate Report is attached hereto as Annexure - IV.
The Corporate Governance Compliance Certificate received from M/s. Walker Chandiok & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, is also attached to this Report.
The Management Discussion and Analysis Report (MDA), as mandated under Schedule V of SEBI (LODR) Regulations, 2015, is also attached to this Report as Annexure - V.
16.0 SIGNIFICANT AND MATERIAL ORDERS
During FY 2017-18, there were no significant orders passed against the Company by the regulators or courts or tribunals, impacting the going concern status and the Companyâs operations in future.
17.0 NOMINATION & REMUNERATION POLICIES
As required under the provisions of Section 178(3) of the Companies Act, 2013 and SEBI (LODR) Regulations 2015, the Company has adopted the policies for Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, etc. The details of the Remuneration Policy for Directors are explained in the Corporate Governance Report, attached hereto as Annexure - IV.
18.0 INDEPENDENT DIRECTORS
All the Independent Directors of the Company have submitted declaration of their independence, as required under Section 149(6) of the Companies Act, 2013.
19.0 DIRECTORS AND KEY MANAGERIAL PERSONNEL
19.1 The Board of Directors of the Company, at its Meeting held on 27th April, 2018, re-appointed Mrs. N. Malkani Nagpal (DIN: 00031985) as the Whole-Time Director, for a period of 3 years, w.e.f. 07th May, 2018, subject to the approval of the Members at the ensuing Annual General Meeting.
19.2 The Board of Directors of the Company, at its Meeting held on 27th April, 2018, re-appointed Mr. S. M. Bhat (DIN: 05168265) as the Managing Director, for a period of 3 years, w.e.f. 11th May, 2018, subject to the approval of the Members at the ensuing Annual General Meeting.
19.3 Mr. R. A. Mirchandani (DIN: 00175501) and Mr. D. A. Lalvani (DIN: 01771000), Directors of the Company, retire by rotation, as per the Articles of Association of the Company and are eligible for re-appointment.
19.4 The Board of Directors, pursuant to Section 152 of the Companies Act, 2013 & Rule 8 of the Companies (Appointment and Qualification of Directors) Rules 2014, has received Form MBP-1 and Consent to act as a Director in Form DIR-2, from Mrs. N. Malkani Nagpal, Mr. S. M. Bhat, Mr. R. A. Mirchandani, & Mr. D. A. Lalvani.
19.5 Necessary Resolutions for re-appointment of the aforesaid Directors have been included in the Notice convening the ensuing AGM and details of the proposed appointees are mentioned in the Appendix to the Explanatory Statement annexed to the Notice.
20.0 DIRECTORS PERFORMANCE EVALUATION
The Company has completed a formal annual performance evaluation, by the Board of its own performance & that of its committees and individual Directors, including the Executive Chairman and the Independent Directors. The manner of evaluation has been explained in the Corporate Governance Report in Annexure - IV.
21.0 DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Sections 134(3)(c) & 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirm that:
a) in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed, along with proper explanation relating to material departures, if any;
b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true & fair view of the state of affairs of the Company at the end of the financial year and of the profits of the Company for that period;
c) the Directors have 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 & detecting fraud and other irregularities;
d) the Directors have prepared the Annual Accounts on a going concern basis;
e) the Directors have laid down internal financial controls, to be followed by the Company and that such internal financial controls are adequate & were operating effectively, and
f) the Directors have devised proper systems to ensure compliance with the provisions of all the applicable laws and that such systems were adequate & operating effectively.
22.0 AUDIT COMMITTEE AND ITS RECOMMENDATIONS
The composition of the Audit Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV
The Board has accepted all the recommendations of the Audit Committee and hence there is no further explanation to be provided for, in this Report.
23.0 NUMBER OF BOARD MEETINGS
The Company has conducted 4 (four) Board meetings during FY 2017-18 and the details thereof are covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV
24.0 STATUTORY AUDITORS
At the 62nd Annual General Meeting held on 30th July, 2015, M/s. Walker Chandiok & Co. LLP, Chartered Accountants, (FRN: 001076N / N500013) were appointed as the Statutory Auditors of the Company to hold office till the conclusion of the Annual General Meeting, to be held in the calendar year 2019. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the Auditors need to be placed for ratification at every subsequent Annual General Meeting since their first appointment. However, pursuant to the notification dated 07th May, 2018 of the Companies (Amendment) Act, 2017, the said appointment is not required to be ratified every year so long as the Auditors are eligible & qualified to be appointed. In this regard, the Company has received a communication from the Auditors to the effect that their appointment is in accordance with the provisions of Section 141 of the Companies Act, 2013.
25.0 STATUTORY AUDITORâS REPORT
There are no qualifications in the Auditorâs Report & therefore there are no further explanations to be provided for in this Report.
26.0 SECRETARIAL AUDITOR & ITS REPORT
The Board of Directors had appointed M/s. N. L. Bhatia & Associates, (Unique Identification Number: P1996MH055800), a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company for FY 2017 - 18. The Secretarial Audit Report is annexed herewith as Annexure - VI. There are no qualifications in the said Report and therefore no explanations are provided in this Report.
27.0 COST AUDITOR
Pursuant to the provisions of Section 148 of the Companies Act, 2013, the Board of Directors had appointed M/s. Kishore Bhatia & Associates, Cost Accountant, Mumbai, as the Cost Auditor of the Company for FY 2017-18.
The brief information of the Cost Auditor and the Cost Audit Report is as under:
27.1 Name of the Cost Auditor: M/s. Kishore Bhatia & Associates
27.2 Address: 701/702, D-Wing, Neelkanth Business Park, Nathani Road, Vidhyavihar (West), Mumbai - 400 086, Maharashtra, India.
27.3 Membership No.: 31166
27.4 Firm Regn. No.: 00294
27.5 Due date for submitting Cost Audit Report for FY 2016-17 by the Cost Auditor with the Company: Within 180 days from the end of the financial year (by 30th September, 2017).
27.6 Actual Date of filing of Cost Audit Report for FY 2016-17 with the Central Government: 06th September, 2017
The Company has appointed M/s. Kishore Bhatia & Associates, Cost Accountants, Mumbai (Firm Registration No. 00294) as the Cost Auditors for FY 2018-19 also. As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor for FY 2018-19, is being placed before the Members at the ensuing Annual General Meeting, for ratification. Accordingly, a Resolution seeking Membersâ ratification for the remuneration payable to M/s. Kishore Bhatia & Associates, Cost Auditors is included as Item No. 7 of the Notice convening the Annual General Meeting.
28.0 VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has framed a policy on Vigil Mechanism-cum-Whistle Blower, which enables any Director / employee of the Company to report their genuine concerns / instances of any unethical / improper activity, directly to the Chairman of the Audit Committee, as a Protected Disclosure. The detailed policy is also posted on the Companyâs intranet Portal SANVAD and onto its website at
http://www.adorwelding.com/images/pdf/corporate_policies/whistle_Blower_cum_Vigil_Mechanism_Policy.pdf
29.0 POLICY ON PREVENTION OF SEXUAL HARASSMENT
The Company has adopted a policy under âThe Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013â and also has a Committee to look into the Complaints, if received. During FY 2017-18, the Company carried out various awareness programs on this subject. No complaints were received by the Committee during FY 2017-18.
30.0 EMPLOYEES
30.1 The industrial relations at all the Plants and Offices of the Company continue to remain harmonious, cordial and peaceful.
30.2 The information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company is annexed herewith as Annexure - VII.
30.3 The on roll manpower strength of the Company as at the date of this Report is 548.
31.0 ACKNOWLEDGEMENT
Your Directors take this opportunity to place on record their warm appreciation for the invaluable contribution and spirit of dedication shown by the employees at all levels during FY 2017-18. The Directors also express their deep gratitude for the business assistance, co-operation and support extended to your Company by its Customers, Distributors, Dealers, Suppliers, Service Providers, Bankers, various Government Organisations / Agencies & Shareholders and look forward to their continued support and co- operation in future also.
For and on behalf of the Board
Aruna B. Advani
Place: Mumbai Executive Chairman
Date: 30th May, 2018 (DIN: 00029256)
Mar 31, 2017
To,
The Members,
The Directors take pleasure in presenting the Sixty Fourth Annual Report of the Company and the Audited Statements of Accounts for the financial year ended 31st March, 2017.
1.0 FINANCIAL PERFORMANCE
(Rs. in Lakhs)
|
Sr. |
Key Financial |
For the |
For the |
For the |
For the |
|
No. |
Indicators |
year ended |
year ended |
year ended |
year ended |
|
31st March 2017 |
31st March 2016 |
31st March 2017 |
31st March 2016 |
||
|
Standalone |
Consolidated |
||||
|
1.1 |
Sales & Other Income (Net of Excise Duty, Discounts & Incentives) |
44,997 |
41,239 |
45,075 |
41,362 |
|
1.2 |
Profit before Interest, Depreciation, Tax & Exceptional Items |
4,034 |
4,630 |
4,022 |
4,620 |
|
1.3 |
Profit before Tax & Exceptional Items |
2,812 |
3,378 |
2,785 |
3,354 |
|
1.4 |
Exceptional Items |
- |
(195) |
- |
(195) |
|
1.5 |
Provision for Tax (including Deferred Tax) |
945 |
918 |
941 |
920 |
|
1.6 |
Profit after Tax (PAT) & Exceptional Items |
1,867 |
2,265 |
1,844 |
2,239 |
2.0 DIVIDEND AND RESERVES
2.1 The Board of Directors is pleased to recommend a Dividend of 50% (i.e. @ Rs.5/- per Equity Share) for the Financial Year (FY) 2016-17, subject to the approval of the Members. Dividend for the previous FY 2015-16 was declared @ 50% (i.e. @ Rs.5/- per Equity Share)*.
2.2 The Dividend for FY 2016-17 shall be paid to those Shareholders and Beneficial Owners whose names appear in the Register of Members as on the cut off date for dividend payment.
2.3 The Board recommends transfer of Rs.187 Lakhs (Rs.227 Lakhs)* to General Reserve. (*Figures in brackets indicate previous year).
3.0 OPERATIONS
In FY 2016-17, the total Sales and Other Income went up by 9.11 %. The year ended with Sales and Other Income of Rs.44,997 Lakhs (Rs.41,239 Lakhs)*.
The Companyâs Sales and Other Income during FY 2016-17 comprised of the following:
3.1 Welding Consumables at Rs.28,235 Lakhs (Rs.27,470 Lakhs)* recorded a marginal growth of about 2.78% over the previous year.
3.2 Equipment & Project Engineering at Rs.15,822 Lakhs (Rs. 13,213 Lakhs)* was higher by about 19.75% over the previous year.
3.3 Other Income of Rs.940 Lakhs mainly comprised of FOREX gain, interest, rent income and profit on sale of investments etc. (Rs.556 Lakhs)*.
(*Figures in brackets indicate previous year).
4.0 CAPEX
The Company incurred CAPEX of Rs.1,381 Lakhs and Capital work - in - progress as at 31st March, 2017 was Rs. 402 Lakhs. CAPEX planned for FY 2017- 18 is Rs.1,476 Lakhs, mainly for the following:-
(a) Automation at Consumables and Equipment Plants.
(b) Production Equipment to balance lines for achieving capacity levels.
(c) Production related Equipment to improve âproductivity and in-process qualityâ.
(d) Replacement of Old Machinery.
(e) Analytical Instruments for R&D.
(f) IT Compliances.
5.0 SUBSIDIARY COMPANIES
5.1 Ador Welding Academy Pvt. Ltd. (AWAPL)
AWAPL, a Wholly Owned Subsidiary of the Company, focuses on creating a pool of skilled welding technicians and professionals to serve a cross-section of industries in the infrastructure sector and also renders consulting to corporates on setting up / improving their welding processes. AWAPL registered a total revenue of Rs.103 Lakhs (Rs.158 Lakhs)*, with a net loss (before exceptional and extraordinary items & tax) of Rs.27 Lakhs (Rs.24 Lakhs)*.
(*Figures in brackets indicate previous year).
Mr. Raman Kumar, Chairman of AWAPL, resigned from the Board of AWAPL and he is being relieved on 1 0th May, 2017. The Board appreciates and acknowledges the contributions made & efforts taken by Mr. Raman Kumar in setting up AWAPL and also for the assistance & guidance provided by him during his tenure as the Director / Chairman of AWAPL.
The Board of Directors of the Company nominated Mr. Satish M. Bhat (DIN: 05168265) onto the Board of AWAPL as an âAdditional Directorâ with effect from 09th May, 2017, as a replacement of Mr. Raman Kumar and requested him to take the Company forward to achieve its objective & goals.
5.2 Plasma Laser Technologies Ltd. (PLT)
During FY 2013-14, the Company had recognised diminution in the value of its investment in PLT and had fully provided for t he same in the financial accounts. In FY 2014-15, a Petition for liquidation of PLT was filed by the employees of PLT with the District Court sitting in Nazareth, Israel. In view of this & orders of District Court of Nazareth, the authority to operate & manage PLT vests with the Court. The due process of law for liquidation is still in progress. Your Company does not foresee any further liability to devolve on it.
6.0 CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated financial statements relate to Ador Welding Ltd. and its wholly owned subsidiary, Ador Welding Academy Private Ltd. These consolidated financial statements are prepared in compliance with all the applicable Accounting Standards. The standalone financial statements of AWAPL are posted onto the website of the Company at the weblink below: http://www.adorwelding.com/images/pdf/ key_financials/2017/Ador-Welding-Academy-Pvt.-Ltd---Financial-Statements-for-FY-2016-17. Pdf and hence the same are not annexed with this 64th Annual Report.
The Annual Accounts and other related information of the said Subsidiary Company will also be made available to the shareholders of the Holding Company.
The Annual Accounts of the Subsidiary Company are available for inspection to the shareholders at the registered office of the Company and your Company shall furnish a physical copy of accounts of subsidiary to any shareholder of the Company, on request.
7.0 RISK MANAGEMENT
Your Company has formulated an Enterprise Risk Management (ERM) framework, to manage various financial & non-financial risks, amongst other things.
The Company has also adopted ERM Policy, which helps to continuously assess & monitor the risks assumed by the Company. The processes are in place for identifying, evaluating and managing the risks. Based on the ERM Policy, the Board further states that there are no elements of risks, which threaten the existence of the Company.
8.0 RELATED PARTY TRANSACTIONS
The Policy on Related Party Transactions is approved by the Board of Directors and the same is uploaded on the Companyâs website: http://www.adorwelding.com/images/pdf/ corporate_policies/RPT_policy.pdf
During FY 2016-17, the Company entered into certain Related Party Transactions, in the ordinary course of business and on arms length basis, with prior approval of the Audit Committee. The Audit Committee grants omnibus approval for the transactions with the related parties, which are foreseen & repetitive in nature. A detailed summary of Related Party Transactions vis-a-vis the omnibus approval is placed before the Audit Committee & the Board of Directors for their review on a quarterly basis.
There are no materially significant Related Party Transactions executed between the Company & its Promoters, Directors, Key Managerial Personnel or other designated persons, that may have a potential conflict with the interest of the Company at large. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.
9.0 EXTRACT OF ANNUAL RETURN
Pursuant to Sections 92(3) and 134(3)(a) of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of Annual Return is appended hereto as Annexure - I, and forms part of this Report.
10.0 CORPORATE SOCIAL RESPONSIBILITY (CSR)
As part of its CSR initiatives, the Company spent Rs. 41.18 Lakhs during FY 2016-17 out of the budgeted CSR expenditure of Rs. 51.67 Lakhs, on various projects in the following areas:
- Promoting education among children, women and underprivileged, including special education & employment enhancing vocation skills, including skill development.
- Promoting sanitation, hygiene and making available safe drinking water or means for the same, to the underprivileged.
The said CSR projects are in accordance with Schedule VII to the Companies Act, 2013. The unspent amount as of 31st March, 2017 was Rs. 10.49 Lakhs. The said unspent CSR amount was not utilized as the Company did not receive any appropriate / suitable CSR proposals as per its Corporate Social Responsibility Policy.
The Annual Report on CSR activities is annexed hereto as Annexure - II.
The composition of the CSR Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV.
11.0 LOANS & GUARANTEES
The details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
12.0 FIXED DEPOSITS
The Company has neither accepted nor renewed Fixed Deposits during FY 2016-17 and FY 2015-16.
13.0 INSURANCE
The properties / assets of the Company are adequately insured.
14.0 ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE
The information required under Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 with respect to conservation of energy, technology absorption & foreign exchange earnings / outgo is appended hereto as Annexure - III.
15.0 CORPORATE GOVERNANCE
As per the Listing Agreements executed with the Stock Exchanges, the Company has been following the Corporate Governance Code from FY 2001-02 onwards. The Company has complied with all the requirements of the Corporate Governance as per the Listing Agreement executed with the Stock Exchanges for the period 01st April, 2016 to 31st March, 2017 pursuant to Regulation 27(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 201 5 and a separate Report is attached hereto as Annexure - IV.
The Corporate Governance Compliance Certificate received from M/s. Walker Chandiok & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, is also attached to this Report.
The Management Discussion and Analysis Report, as mandated under Schedule V of SEBI (LODR) Regulations, 2015 is also attached to this Report as Annexure V.
16.0 SIGNIFICANT AND MATERIAL ORDERS
During FY 2016-17, there were no significant orders passed against the Company by the regulators or courts or tribunals, impacting the going concern status and the Companyâs operations in future.
17.0 NOMINATION & REMUNERATION POLICIES
As required under the provisions of Section 178(3) of the Companies Act, 2013 and SEBI (LODR) Regulations 2015, the Company has adopted the policies for Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of Director, etc. The details of the Remuneration Policy for Directors are explained in the Corporate Governance Report, attached hereto as Annexure - IV.
18.0 INDEPENDENT DIRECTORS
All the Independent Directors of the Company have submitted declaration of their independence, as required under Section 149 (6) of the Companies Act, 2013.
19.0 DIRECTORS AND KEY MANAGERIAL PERSONNEL
19.1 Ms. Aruna. B. Advani (DIN: 00029256) and Mrs. N. Malkani Nagpal (DIN:00031985), Directors of the Company, retire by rotation, as per the Articles of Association of the Company and are eligible for re-appointment.
The Board of Directors, pursuant to Section 152 of the Companies Act, 2013 & Rule 8 of the Companies (Appointment and Qualification of Directors) Rules 2014, has received Form MBP-1 and Consent to act as a Director in Form DIR-2, from Ms. Aruna. B. Advani & Mrs. N. Malkani Nagpal.
19.2 Necessary Resolutions for re-appointment of the aforesaid Directors have been included in the Notice convening the ensuing AGM and details of the proposed appointees are mentioned in the Appendix to the Explanatory Statement annexed to the Notice.
20.0 DIRECTORS PERFORMANCE EVALUATION
The Company has completed a formal annual performance evaluation, by the Board of its own performance & that of its committees and individual Directors, including the Executive Chairman & the Independent Directors. The manner of evaluation has been explained in the Corporate Governance Report in Annexure - IV.
21.0 DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Sections 134(3)(c) & 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirm that:
a) in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed, along with proper explanation relating to material departures, if any;
b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true & 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 that period;
c) the Directors have 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 & detecting fraud and other irregularities;
d) the Directors have prepared the Annual Accounts on a going concern basis;
e) the Directors have laid down internal financial controls, to be followed by the Company and that such internal financial controls are adequate & were operating effectively, and
f) the Directors have devised proper systems to ensure compliance with the provisions of all the applicable laws and that such systems were adequate & operating effectively.
22.0 AUDIT COMMITTEE AND ITS RECOMMENDATIONS
The composition of the Audit Committee is covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV.
The Board has accepted all the recommendations of the Audit Committee and hence there is no further explanation to be provided for, in this Report.
23.0 NUMBER OF BOARD MEETINGS
The Company has conducted 4 (four) Board meetings during FY 2016-17 and the details thereof are covered under the Corporate Governance Report, which is annexed to this Report as Annexure - IV.
24.0 STATUTORY AUDITORS
At the 62nd Annual General Meeting held on 30th July, 2015, M/s. Walker Chandiok & Co. LLP Chartered Accountants, (FRN: 001076N / N500013) were appointed as Statutory Auditors of the Company to hold office till the conclusion of the Annual General Meeting, to be held in the calendar year 2019. 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 subsequent Annual General Meeting since their first appointment. Accordingly, the appointment of M/s. Walker Chandiok & Co. LLP, Chartered Accountants, as the Statutory Auditors of the Company, is placed for ratification by the shareholders. In this regard, the Company has received a communication from the Auditors to the effect that if they are re-appointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.
25.0 STATUTORY AUDITORâS REPORT
There are no qualifications in the Auditorâs Report & therefore there are no further explanations to be provided for in this Report.
26.0 SECRETARIAL AUDITOR & ITS REPORT
The Board of Directors had appointed M/s. N. L. Bhatia & Associates, (Unique Identification Number: P1996MH055800), a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company for FY 201 61 7. The Secretarial Audit Report is annexed herewith as Annexure - VI. There are no qualifications in the said Report and therefore no explanations are provided in this Report.
27.0 COST AUDITOR
Pursuant to the provisions of Section 1 48 of the Companies Act, 201 3, the Board of Directors had appointed M/s. Kishore Bhatia & Associates, Cost Accountant, Mumbai, as the Cost Auditor of the Company for FY 2016-17.
The brief information of the Cost Auditor and the Cost Audit Report is as under:
27.1 Name of the Cost Auditor: M/s. Kishore Bhatia & Associates
27.2 Address: 701/702, D-Wing, Neelkanth Business Park, Nathani Road, Vidhyavihar (West), Mumbai - 400 086, Maharashtra,India.
27.3 Membership No.: 31166
27.4 Firm Regn. No. : 00294
27.5 Due date for filing Cost Audit Report (XBRL) for FY 2015-16 by the Cost Auditor with the Central Government: Within 180 days from the end of the financial year (30th September, 2016).
27.6 Actual Date of filing of Cost Audit Report for FY 2015-16 with the Central Government: 19th September, 2016
The Company has appointed M/s. Kishore Bhatia & Associates, Cost Accountants, Mumbai (Firm Registration No. 00294) as the Cost Auditors for FY 2017-18 also. As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor for FY 2017-18, is being placed before the Members at the ensuing Annual General Meeting, for ratification. Accordingly, a Resolution seeking Membersâ ratification for the remuneration payable to M/s. Kishore Bhatia & Associates, Cost Auditors is included as Item No. 6 of the Notice convening the Annual General Meeting.
28.0 VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has framed a policy on Vigil Mechanism-cum-Whistle Blower, which enables any Director / employee of the Company to report their genuine concerns / instances of any unethical / improper activity, directly to the Chairman of the Audit Committee, as a Protected Disclosure. The detailed policy is also posted on the Companyâs intranet Portal SANVAD and onto its website at http://www. adorwelding.com/images/pdf/corporate_ policies/whistle_Blower_cum_Vigil_Mechanism_ Policy.pdf
29.0 POLICY ON PREVENTION OF SEXUAL HARASSMENT
The Company has adopted a policy under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and also formed a Committee to look into the Complaints, if received. During FY 2016-17, the Company carried out various awareness programs on this subject. No complaints were received by the Committee during FY 2016-17.
30.0 EMPLOYEES
30.1 The industrial relations at all the Plants and Offices of the Company continue to remain harmonious, cordial and peaceful.
30.2 The information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company, is annexed herewith as Annexure - VII.
30.3 The manpower strength of the Company as at the date of this Report is 601.
31.0 ACKNOWLEDGEMENT
Your Directors take this opportunity to place on record their warm appreciation for the invaluable contribution and spirit of dedication shown by the employees at all levels during FY 2016-17. The Directors also express their deep gratitude for the business assistance, co-operation and support extended to your Company by its Customers, Distributors, Dealers, Suppliers, Service Providers, Bankers, various Government Organisations / Agencies & Shareholders and look forward to their continued support and cooperation in future also.
For and on behalf of the Board
Aruna B. Advani
Place: Mumbai Executive Chairman
Date: 09th May, 2017 (DIN: 00029256)
Mar 31, 2015
The Members,
The Directors take pleasure in presenting the Sixty Second Annual
Report of the Company and the Audited Statement of Accounts for the
financial year ended 31st March, 2015.
1.0 FINANCIAL PERFORMANCE
(Rs. in lacs)
Standalone
Key Financial Indicators For the For the
year ended year ended
31st March, 2015 31st March, 2014
Sales & Other Income (Net of Excise
Duty, Discounts & Incentives) 38,953 37,341
Profit Before Interest & Depreciation 3,373 4,195
Profit Before Tax (PBT) 2,016 2,850
Exceptional items 2,811 (1,478)
Provision for Tax (including Deferred Tax) 1,590 949
Profit After Tax (PAT) 3,237 423
(Rs. in lacs)
Consolidated
Key Financial Indicators For the For the
year ended year ended
31st March, 2015 31st March, 2014
Sales & Other Income (Net of Excise
Duty, Discounts & Incentives) 39,045 37,623
Profit Before Interest & Depreciation 3,332 3,173
Profit Before Tax (PBT) 1,963 1,736
Exceptional items 2,817 (1,296)
Provision for Tax (including Deferred Tax) 1,594 951
Profit After Tax (PAT) 3,186 (511)
2.0 DIVIDEND AND RESERVES
2.1 The Board of Directors is pleased to recommend a Dividend of 50%
(i.e. @ Rs.5/- per Equity Share) for the financial year (FY) 2014-15,
subject to the approval of the Members. Dividend for the previous FY
2013- 14 was declared @ 50% (i.e. @ Rs.5/- per Equity Share).
2.2 The Dividend for FY 2014-15 shall be paid to those Shareholders and
Beneficial Owners whose names appear in the Register of Members as on
the date of the Book Closure for dividend payment.
2.3 The Board recommends transfer of Rs. 324 Lacs (Rs. 42 Lacs)* to the
General Reserve, and the balance of Rs. 5,271 Lacs (Rs. 3,284 Lacs)*
for retention in the Profit & Loss Account. (*Figures in brackets
indicate previous year).
3.0 OPERATIONS
In FY 2014-15, the total Sales and Other Income went up by 4.32%. The
year ended with Sales and Other Income of Rs. 38,953 Lacs (Rs. 37,341
Lacs).
The Company's Sales and Other Income during FY 2014-15 comprised of the
following:
3.1 Welding Consumables at Rs. 27,181 Lacs (Rs. 27,532 Lacs)*- Due to
severe competition witnessed in the Welding Industry over last year &
core industrial sector showing de- growth, Domestic Sales of
Consumables recorded a degrowth of over 1.27% compared to the previous
year.
3.2 Equipment & Project Engineering at Rs.11,313 Lacs (Rs. 9,303 Lacs)*
- The Welding Equipment & Project Engineering Business was higher by
over 21% compared to the previous year, due to better performance of
Project Engineering division.
3.3 Other Income at Rs. 459 Lacs (Rs. 506 Lacs)*. (*Figures in
brackets indicate previous year).
4.0 CONSOLIDATION OF MANUFACTURING OPERATIONS
The Company has decided to suspend its
manufacturing activities for certain product lines at Chennai and has
partially relocated its manufacturing activities from Chennai to
Silvassa & Raipur Plants, on account of economies of scale, by
optimizing the available resources, which will help the Company enhance
operational efficiencies. The employees at Chennai Plant are also being
relocated to Silvassa & Raipur Plants. The Company doesn't anticipate
any disruption in supply of its products due to this relocation /
consolidation of operations, as the Company has adequate production
capacities for consumables at Raipur & Silvassa.
5.0 CAPEX
The Company completed CAPEX of Rs. 933 Lacs and CAPEX of Rs.160 Lacs is
in various stages of progress.The entire CAPEX programme of FY 2014- 15
shall be completed by the end of June 2015. For FY 2015-16, the CAPEX
has been budgeted at Rs.1,250 Lacs, mainly for -
(a) Automation at Consumables and Equipment Plants.
(b) Production Equipments to balance lines for achieving capacity
levels.
(c) Production related Equipment to improve "in process quality and
deviation control" towards six-sigma levels.
(d) Analytical Instruments for R&D.
6.0 SUBSIDIARY COMPANIES
6.1 Ador Welding Academy Pvt. Ltd. (AWAPL)
AWAPL, a Wholly Owned Subsidiary of the Company, focuses on creating a
pool of skilled welding technicians who will serve the cross-section of
infrastructure building- related industries. AWAPL registered a total
revenue of Rs. 131 Lacs (Rs. 77 Lacs)*, with net loss of Rs. 53 Lacs
(Rs. 66 Lacs)*
(*Figures in brackets indicate previous year).
6.2 Plasma Laser Technologies Ltd. (PLT)
During FY 2013-14, the Company had recognised diminution in the value
of its investment in PLT and had fully provided for the same in the
financial accounts. In the current year 2014 -15, a Petition for
liquidation of PLT was filed by the employees
of PLT with the District Court sitting in Nazareth, Israel. In view of
this & orders of District Court of Nazareth, the authority to operate &
manage PLT now vests with the Court. The due process of law for
liquidation is in progress. Your Company does not foresee any further
liability to devolve on the Company.
7.0 CONSOLIDATED FINANCIAL STATEMENTS
In the previous FY 2013-14, the consolidated financial statements
presented by the Company included financial information of its
subsidiaries PLT & AWAPL. In the current year 2014-15, as mentioned in
para 6.2, PLT has gone into liquidation. As a result, the power &
authority to manage / operate PLT vests with the District Court of
Nazareth. The Company, therefore, in the current year 2014-15 has
presented the Consolidated Accounts without financial information of
PLT. These consolidated financial statements are prepared in compliance
with the applicable Accounting Standards. The standalone financial
statements of AWAPL are posted onto the website of the Company
http://www.adorwelding.com/site/key-financial-
and-shareholding-pattern.html and hence the same are not annexed with
this 62nd Annual Report. The Annual Accounts and other related
information of the said Subsidiary Company will also be made available
to the shareholders of the Holding Company. The Annual Accounts of the
Subsidiary Company are available for inspection by the shareholders at
the registered office of the Company and your Company shall furnish a
physical copy of the detailed accounts of subsidiary to any
shareholder, on request.
8.0 RISK MANAGEMENT
Your Company has put in place the Enterprise Risk Management framework,
to manage the various financial & non-financial risks, amongst other
things.
The Company has also adopted Enterprise Risk Management (ERM) Policy,
which helps to continuously assess & monitor the risks assumed by the
Company. The processes are in place for identifying, evaluating and
managing the risks. Based on the ERM Policy, the Board further states
that there are no elements of risks which threaten the existence of the
Company.
9.0 RELATED PARTY TRANSACTIONS
The Policy on Related Party Transactions is approved by the Board of
Directors and the same is uploaded on the Company's website :
http://www.adorwelding.com/site/docs/RPT%20
Policy.pdf
During FY 2014-15, the Company entered into certain Related Party
Transactions which are in the ordinary course of business and at arms
length basis, with approval of the Audit Committee. The Audit
Committee grants omnibus approval along with the Annual Budget for the
transactions with the related parties, which are of foreseen &
repetitive nature. A detailed summary of Related Party Transactions
vis-a-vis the omnibus approval, is placed before the Audit Committee &
the Board of Directors for their review on a quarterly basis.
There are no materially significant Related Party Transactions executed
between the Company & its Promoters, Directors, Key Managerial
Personnel or other designated persons, that may have a potential
conflict with the interest of the Company at large. None of the
Directors have any pecuniary relationships or transactions vis-a- vis
the Company.
10.0 EXTRACT OF ANNUAL RETURN
Pursuant to Section 92 (3) and 134 (3) (a) of the Companies Act, 2013,
read with Rule 12 (1) of the Companies (Management and Administration)
Rules, 2014, the extract of Annual Return is appended hereto as
Annexure - I, and forms part of this Report.
11.0 CORPORATE SOCIAL RESPONSIBILITY
The composition of Corporate Social Responsibility (CSR) Committee is
covered under the Corporate Governance Report, which is annexed to this
Report as Annexure - IV.
As part of its initiatives under "Corporate Social Responsibility",
the Company has undertaken various projects in the areas of Education
(Skill development) and Women Empowerment. These projects are largely
in accordance with Schedule VII to the Companies Act, 2013. During the
year, out of the budgeted expenditure of Rs. 51.87 Lacs, approx. Rs.
5.30 Lacs remained unspent, since certain proposals were under
consideration as of 31st March 2015. The Annual Report on CSR activities
is annexed hereto as
Annexure - II.
12.0 LOANS & GUARANTEES
During FY 2014-15, your Company has provided Bank Guarantee / Corporate
Guarantee of Rs. 100 Lacs for the working capital limits of M/s. Ador
Welding Academy Private Limited (AWAPL), the Wholly Owned Subsidiary
Company. Details of Loans, Guarantees and Investments covered under
the provisions of Section 186 of the Companies Act, 2013 are given in
the notes to the Financial Statements.
13.0 FIXED DEPOSITS
The Company has neither accepted nor renewed Fixed Deposits during FY
2014-15 and in FY 2013-14.
14.0 INSURANCE
The properties / assets of the Company are adequately insured.
15.0 ENERGY CONSERVATION, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE
The information required under Section 134 (3) (m) of the Companies
Act, 2013, read with the Companies (Accounts) Rules, 2014 with respect
to conservation of energy, technology absorption & foreign exchange
earnings / outgo is appended hereto as Annexure - III.
16.0 CORPORATE GOVERNANCE
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from FY
2001-02 onwards. The Company has complied with all the requirements of
the Corporate Governance as per Clause 49 of the Listing Agreement and
a separate Report is attached hereto as Annexure - IV.
The Corporate Governance Compliance Certificate received from M/s.
Dalal & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached to this Report.
The Management Discussion and Analysis Report, as mandated under the
Code of Corporate Governance, is also attached to this Report as
Annexure - V.
17.0 COURT ORDERS
During FY 2014-15 there were no significant orders passed against the
Company by the regulators or courts or tribunals, impacting the going
concern status and Company's operations in future.
18.0 NOMINATION & REMUNERATION POLICIES
As required under the provisions of sub-section (3) of Section 178 of
the Companies Act, 2013 the Company has adopted the policies for
Directors' appointment and remuneration including criteria for
determining qualifications, positive attributes, independence of
Director, etc. The details of Remuneration Policy for Directors is
explained in the Corporate Governance Report.
19.0 INDEPENDENT DIRECTORS
All the Independent Directors of the Company have submitted declaration
of their independence, as required under Section 149 (6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
20.0 DIRECTORS
20.1 During FY 2014-15 the following changes occurred in the
composition of the Board of Directors of the Company:
(a) Mr. Vippen Sareen, (DIN 00057599) Non-Executive & Independent
Director, retired from the Board on attaining superannuation at the age
of 65 years on 07th July, 2014 and thus ceased to be a Director of the
Company. Mr. Sareen was appointed as Director on 23rd October, 2010
and was on the Board for 4 years. The Board places on record, its
sincere appreciation for the contributions of Mr. Vippen Sareen during
his tenure of Directorship.
(b) Mr. Anil Harish, (DIN 00001685) Non- Executive & Independent
Director, tendered his resignation on & w.e.f. 30th September 2014,
which was taken on record in the meeting of the Board of Directors held
on 10th November, 2014. Mr. Anil Harish was appointed as Director on
the Board on 28th March, 2005 and was on the Board for over 9 years. He
was also the Chairman of Audit Committee and CSR Committee. The Board
places on record, its sincere appreciation for the contributions of Mr.
Anil Harish during his tenure of Directorship.
(c) Mr. G. M. Lalwani (DIN 06928792) and Mr. S. G. Mirchandani (DIN
01179921) joined the Board as "Additional Directors" with effect from
10th November, 2014. They joined the Board in place of Mr. Vippen
Sareen & Mr. Anil Harish, respectively. The Company has received
Notices in writing from Members proposing their candidature to the
Office of Directors of the Company. In the interest of the Company's
continued prosperity and well-being, the Board recommends their
appointments as the Independent Directors at the ensuing Annual General
Meeting.
(d) The Board of Directors of the Company at its Meeting held on 07th
May, 2015 appointed and re-designated Mrs. N. Malkani Nagpal (DIN
00031985) as the Whole-Time Director, for a period of 3 years, subject
to the approval of the Members at the ensuing Annual General Meeting.
(e) The Board of Directors of the Company at its Meeting held on 07th
May, 2015 re-appointed Mr. S. M. Bhat (DIN 05168265) as the Managing
Director, for a period of 3 years, w.e.f. 11th May, 2015 subject to the
approval of the Members at the ensuing Annual General Meeting (AGM).
20.2 Ms. A. B. Advani (DIN 00029256) and Mr. R. A. Mirchandani (DIN
00175501), Directors of the Company, retire by rotation, as per the
Articles of Association of the Company and are eligible for
re-appointment.
20.3 The Board of Directors, pursuant to Section 152 of the Companies
Act, 2013 & Rule 8 of the Companies (Appointment & Qualification of
Directors) Rules, 2014, has received Form MBP-1 and Consent to act as a
Director in Form DIR-2, from Mr. G. M. Lalwani, Mr. S. G. Mirchandani,
Mrs. N. Malkani Nagpal, Mr. S. M. Bhat, Ms. A. B. Advani and Mr. R. A.
Mirchandani.
20.4 Necessary Resolutions for the appointment of the aforesaid
Directors have been included in the Notice convening the ensuing AGM
and details of the proposal for appointments are mentioned in the
Explanatory Statement to the Notice.
21.0 DIRECTORS PERFORMANCE EVALUATION
The Company has conducted a formal annual performance evaluation, by
the Board of its own performance & that of its committees and
individual Directors, including the Executive Chairman & the
Independent Directors. The detailed manner of evaluation has been
explained in the Corporate Governance Report in Annexure - IV.
22.0 DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2013, the
Board of Directors of the Company hereby confirm that:
a) in the preparation of the Annual Accounts, the applicable Accounting
Standards have been followed, alongwith proper explanation relating to
material departures, if any;
b) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent, so as to give a true & 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 that period;
c) the Directors have 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 & detecting fraud and other irregularities;
d) the Directors have prepared the Annual Accounts on a going concern
basis;
e) the Directors have laid down internal financial controls, to be
followed by the Company and that such internal financial controls are
adequate & were operating effectively, and
f) the Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate & operating effectively.
23.0 AUDIT COMMITTEE AND ITS RECOMMENDATIONS
The composition of Audit Committee is covered under the Corporate
Governance Report, which is annexed to this Report as Annexure - IV.
The Board has accepted all the recommendations of the Audit Committee
and hence there is no further explanation to be provided for in this
Report.
24.0 NUMBER OF BOARD MEETINGS
The Company has conducted 4 (four) Board meetings during FY 2014-15 and
the details thereof are covered under the Corporate Governance Report,
which is annexed to this Report as Annexure - IV.
25.0 STATUTORY AUDITORS
The Company's Statutory Auditors, M/s. Dalal & Shah, Chartered
Accountants, Mumbai, retire at the ensuing Annual General Meeting. The
Audit Committee has recommended appointment of new Statutory Auditors
for the Company, in view of the rotation of Auditors mandated under the
Companies Act, 2013. Your Board recommends the appointment of M/s.
Walker Chandiok & Co. LLP as the Statutory Auditors, at the ensuing
Annual General Meeting.
26.0 STATUTORY AUDITOR'S REPORT
There are no qualifications in the Auditor's Report & therefore there
are no further explanations to be provided for in this Report.
27.0 SECRETARIAL AUDITOR & ITS REPORT
The Board of Directors had appointed M/s. N. L. Bhatia & Associates,
(Unique Identification Number: S1996MH016600), a firm of Company
Secretaries in Practice, to undertake the Secretarial Audit of the
Company for FY 2014-15. The Secretarial Audit Report is annexed
herewith as Annexure - VI. There are no qualifications in the said
Report.
28.0 COST AUDITOR
Pursuant to the provisions of Section 148 of the Companies Act, 2013,
the Board of Directors has appointed Mr. Vishvesh Desai, Cost
Accountant, Pune, as the Cost Auditor of the Company.
The brief information of the Cost Auditor and the Cost Audit Report is
as under:
28.1 Name of the Cost Auditor: CMA Vishvesh Desai
28.2 Address: 10, Prabhakarsmruti CHS Ltd., 4th Lane, Dahanukar Colony,
Kothrud, Pune - 411 029, Maharashtra, India.
28.3 Membership No.: F-7330.
28.4 Firm Regn. No. : 102151
28.5 Due date for filing Cost Audit Report (XBRL) for FY 2013-14 by the
Cost Auditor with the Central Government: Within 180 days from the end
of the financial year.
28.6 Actual Date of filing of Cost Audit Report for FY 2013-14 with the
Central Government: 14.10.2014
As required under the Companies Act, 2013, the remuneration payable to
the Cost Auditor for FY 2015-16, is placed before the Members at the
ensuing Annual General Meeting, for their ratification. Accordingly, a
Resolution seeking Members' ratification for the remuneration payable
to CMA Vishvesh Desai, Cost Auditor is included at Item No. 6 of the
Notice convening the Annual General Meeting.
29.0 VIGIL MECHANISM & WHISTLE BLOWER POLICY
The Company has framed a policy on Vigil Mechanism-cum-Whistle Blower,
which enables any Director / employee of the Company to report their
genuine concerns / instances of any unethical / improper activity,
directly to the chairman of the Audit Committee, as a Protected
Disclosure. The detailed policy is also posted on the Company's
intranet Portal SAMVAD and onto its website
http://www.adorwelding.com/site/docs/
Whistle%20Blower-cum-Vigil%20Mechanism%20 Policy.pdf
30.0 PREVENTION OF SEXUAL HARASSMENT POLICY
The Company has adopted a policy under The Sexual Harassment of Women
at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The
Company has constituted Committee/s, as required under the Act & Rules
made there under and has carried out awareness programs. No complaints
were received by the Committees during FY 2014-15.
31.0 EMPLOYEES
31.1 The industrial relations at all the Plants and Offices of the
Company continue to remain harmonious, cordial and peaceful.
31.2 The information required pursuant to Section 197(12) of the
Companies Act, 2013 read with Rule 5 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 in respect of the
employees of the Company, is annexed herewith as Annexure - VII.
31.3 The manpower strength of the Company as at the date of this Report
is 679.
32.0 ACKNOWLEDGEMENT
Your Directors take this opportunity to place on record their warm
appreciation for the invaluable contribution and the spirit of
dedication shown by the employees at all levels during FY 2014-15. The
Directors also express their deep gratitude for the business
assistance, co-operation and support extended to your Company by its
Customers, Distributors, Dealers, Suppliers / Service Providers,
Bankers, various Government Organisations / Agencies & Shareholders and
look forward to their continued support and co-operation in future
also.
For and on behalf of the Board
Place: Mumbai A. B. Advani
Date: 07th May, 2015 Executive Chairman
Mar 31, 2014
The Members,
The Directors have pleasure in presenting the Sixty First Annual Report
of the Company and the Audited Statement of Accounts for the year ended
31st March, 2014,
1.0 Einancial Performance (Rupees in Crore)
Sr. Key Financial
Indicators For the For the For the For the
No. year ended year ended year ended year ended
31st March,
2014 31st March,
2013 31st March,
2014 31st March,
2013
Standalone Consolidated
1.1 Sales & other Income
(Net of Excise Duty,
Discounts &
Incentives) 373 368 376 369
1.2 Profit before
Interest
and Depreciation 42 40 32 38
1.3 Profit before
Tax (PBT) 29 27 17 25
1.4 Exceptional Items 15 - 13 -
1.5 Provision for Tax
(Net of deferred
tax) 10 8 9 8
1.6 Profit after
Tax (PAT) 4 19 (5) 17
2.0 Dividend and Reserves
2.1 The Board of Directors is pleased to recommend a Dividend of 50%
(i.e. @ Rs.5/- per Equity Share) for the financial year (FY) 2013-14,
subject to the approval of the Members. Dividend for the previous FY
2012-13 was declared @ 60% (i.e. @ Rs.6/- per Equity Share).
2.2 The Dividend for the FY 2013-14 shall be paid to those Shareholders
and Beneficial Owners whose names appear in the Register of Members as
on the date of the Book Closure for Dividend payment.
2.3 The Board recommends transfer of Rs. 0.42 Crore (Rs. 2 Crore)* to
the General Reserve, and the balance of Rs.33 Crore (Rs. 37 Crore)* for
retention in the Profit & Loss Account.
(''Figures in brackets indicate previous year).
3.0 Operations (Standalone)
In the financial year 2013-14, the total operational & other income
stood at Rs.373 Crore, as against Rs.368 Crore for the FY 2012-13,
showing a marginal rise of 1%, with the achievement of highest ever
billing of Rs. 373 Crore during the FY 2013-14.
The Company''s Sales and other Income during the FY 2013-14 comprised of
the following:
3.1 Welding Consumables : Rs.276 Crore (Rs. 282 Crore)*
Due to major curb in the welding industry, and the decade''s low figure
of GDP at 4.50%, unfavourable economic conditions, Domestic Sales of
Consumables recorded a de-growth of over 2% compared to the previous
year. However volume grew by 3% during the year.
3.2 Equipment & Project Engineering at Rs.93 Crore (Rs. 82 Crore)*
Inspite of Capital goods Industry witnessing slump, Equipment business
grew by about 14% over last year. Further the volume in Welding
Equipment business was higher by over 71% compared to the previous
year.
3.3 Other Income at Rs.4 Crore (Rs. 4 Crore)* ("Figures in brackets
indicate previous year).
4.0 CAPEX
During the FY 2013-14, we completed CAPEX of Rs. 9 Crore and Rs. 2
Crore is in various stages of progress. The budgeted CAPEX for the FY
2014-15 is about Rs. 14 Crore mainly for -
(a) Consumables, Equipment and R&D,
(b) Production Equipment to balance lines for achieving capacity
production levels.
(c) Production related Equipment to improve in process, quality and
deviation control towards six-sigma levels.
(d) Analytical Instruments for Equipment R&D. 5.0 Subsidiary Companies
5.1 Ador Welding Academy Pvt. Ltd. (AWAPL)
AWAPL was incorporated on 24th July 2012 as a wholly owned subsidiary
of the Company for vocational training in welding and also for
consultancy in Welding. AWAPL registered a Total Revenue of Rs. 77 Lacs
(Previous period Rs. 31 Lacs), with net loss of Rs. 68 Lacs (Previous
period Rs. 33 Lacs). The Company is persevering efforts to tap large
potential business in Pre-Service Training & In-Service Training. The
launch of the E-Learning module should also garner additional revenues.
The focus of the Government on National Skill Development will also
help in increasing its revenue.
5.2 Plasma Laser Technologies Ltd. (PLT)
PLT has generated revenues of Rs. 224 Lacs (Previous period Rs. 78
Lacs) and has incurred a Net Loss of Rs. 1,054 Lacs (Previous period
Rs.187 Lacs), In view of accumulated losses exceeding networth and
considering the underlying factors including downturn in business and
decrease in related activities, the Company has recognised provision
for dimunition in the value of Investments in PLT as on 31st March 2014
amounting to Rs 1,981 Lacs.
There are two subsidiary companies of PLT, which are named below:-
1. M/s, Aluminium Hybrid Systems Ltd. - formed for developing products
for Aluminum Plasma Welding.
2. M/s. Plasma Laser Technologies, North America, Inc. - formed for
carrying out
Business Development Activities in North America,
By virtue of acquisition of majority equity stake in PLT (Holding
Company of above two subsidiaries), these two Companies continue to be
subsidiary Companies of your Company.
6.0 Consolidated Financial Statements
The consolidated financial statements presented by the Company include
financial information of its subsidiaries, and are prepared in
compliance with the applicable Accounting Standards issued by the
Institute of Chartered Accountants of India.
In view of the general exemption granted by the Ministry of Corporate
Affairs vide circulars dated February 8,2011 & February 21,-2011, the
reports & annual accounts of the subsidiary companies are not required
to be attached to your Company''s Accounts for the FY ended 31st March
2014.
Accordingly, the annual accounts and detailed related information of
the subsidiary companies will be made available to any shareholder
seeking such information. The annual accounts of the Subsidiary
Companies are also available for inspection by the shareholders at the
Registered office of the Company and also available on your Company''s
website, www.adorwelding.com, in a downloadable / printable format.
Shareholders desirous of obtaining the hard copy of annual report of
your Company''s subsidiaries may obtain the same upon request.
7.0 Directors'' Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
Directors of the Company hereby confirm that:
7.1 In preparation of the Annual Accounts, all the applicable
Accounting Standards have been followed;
7.2 Proper accounting policies have been selected & applied them
consistently and made judgments & estimates that are reasonable and
prudent so as to give a true & fair view of the state of affairs of the
Company as at the end of the financial year and of the profits of the
Company for that period,
7.3 Proper & sufficient care has been taken for maintenance of adequate
accounting /
Statutory Records in accordance with the provisions of the Companies
Act, 1956, for safeguarding the Assets of the Company and for
preventing / detecting fraud & other irregularities.
7.4 Annual Accounts have been prepared on a going-concern basis.
8.0 Directors
8.1 During the FY 2013-14 Ms. A. B. Advani has been re-appointed as the
Executive Chairman of the Company with effect from 01st May, 2014 for a
period of 5 Years.
The above appointment is subject to the approval of the Members at the
ensuing Annual General Meeting of the Company.
8.2 Mr. D. A. Lalvani and Mrs N. Malkani Nagpal, Directors of the
Company, retire by rotation, as per the Articles of Association of the
Company and are eligible for re- appointment.
8.3 Mr. M. K. Maheshwari, Mr. R K. Gupta, Mr. R. N. Sapru and Mr. K.
Digvijay Singh were appointed by the Company, pursuant to the
provisions of clause 49 of the Listing Agreements executed with Stock
Exchanges, as Non-Executive & Independent Directors of the Company, who
were liable to retire by rotation as per the Articles of Association of
the Company and the provisions of the Companies Act 1956.
As per section 149 of the Companies Act, 2013, which came into effect
from 01st April, 2014, every Listed Company is required to have at
least one-third of the total number of directors as Independent
Directors, who are not liable to retire by rotation. (There was no
corresponding provision w.r.t. Independent Directors under the
Companies Act, 1956) Accordingly, the above named Directors are being
appointed as Independent Directors, not liable to retire by rotation
and to hold office as per their tenure of appointment mentioned in the
Notice of the forthcoming Annual General Meeting of the Company, as per
the provisions of the Companies Act, 2013.
8.4 The Board of Directors has received Form- DDA from all the above
named Directors, as prescribed under the Companies Disqualification of
Directors (under Section 274(1 )(g) of the Companies Act, 1956) Rules,
2003, informing the Company that they are not disqualified under
Section 274(1 )(g) of the Companies Act, 1956 and also Form DIR-8,
pursuant fo Section 164 of the Companies Act, 2013 & Rule 14(1) of the
Companies (Appointment & Qualification of Directors) Rules, 2014,
alongwith their consent in Form DIR-2 pursuant to Section 152 of the
Companies Act, 2013 & Rule 8 of the Companies (Appointment &
Qualification of Directors) Rules, 2014.
9.0 Fixed Deposits
The Company has neither accepted nor renewed Fixed Deposits during the
FY 2013-14.
10.0 Insurance
The properties / assets of the Company are adequately insured.
11.0 Energy conservation, Technology Absorption & Foreign Exchange
The information required under Section 217(l)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in Report of
the Board of Directors) Rules, 1988 with respect to conservation of
energy, technology absorption & foreign exchange earnings / outgo is
appended hereto as Annexure -1 and forms part of this Report.
12.0 Corporate Governance
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from the FY
2001-02 onwards. The Company has complied with all the requirements of
the Corporate Governance as per Clause 49 of the Listing Agreement and
a separate Report is attached herewith to this Report as Annexure - II.
The Corporate Governance Compliance Certificate obtained from M/s.
Dalai & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached herewith, to this Report.
The Management Discussion and Analysis (MDA) Report, as mandated under
the Code of Corporate Governance, is also attached to the Directors''
Report as Annexure - III.
13.0 Auditor''s Report
There are no qualifications contained in the Auditor''s Report &
therefore there are no further explanations to Pe provided for in this
Report.
14.0 Statutory Auditors
The Company''s Statutory Auditors, M/s. Dalai & Shah, Chartered
Accountants, MumPai, retire and are eligible for re-appointment.
15.0 Cost Auditors
Pursuant to the approval of the Central Government under Section 233B
of the Companies Act, 1956, the Board of Directors has appointed Mr.
Vishvesh Desai, Cost Accountant, Pune, as the Cost Auditor of the
Company for audit of cost accounting records of its "Automig Wires"
(Steel) under chapter heading 72 and all other products manufactured by
the Company, which are covered under Chapter 83 & 84 of the Central
Excise Tariff Act, 1985.
The brief information of the Cost Auditor and the Cost Audit Report is
as under:
15.1 Name of the Cost Auditor: CM A Vishvesh Desai
15.2 Address of the Cost Auditor: 10, Prabhakarsmruti CHS Ltd., 4th
Lane, Dahanukar Colony, Kothrud, Pune - 411 029, Maharashtra, India.
15.3 Membership No.: F-7330.
15.4 Firm Regn. No.: 102151
15.5 Due date for filing Cost Audit Report (XBRL) for the FY 2012-13 by
the Cost Auditor with the Central Government: 27th September 2013.
15.6 Actual Date of filing of Cost Audit Report (XBRL) for the FY
2012-13 with the Central Government: 26th September 2013.
16.0 Employees
16.1 The industrial relations in all the Plants and
Offices of the Company continue to remain harmonious, cordial and
peaceful.
16.2 The information required in terms of Section
217 (2A) of the Companies Act, 1956, read with 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,
this Annual Report is being sent to all the Members of the Company
without the said statement of particulars of Employees (which is
available for inspection by any Member at the Registered Office of the
Company during working hours upto the date of the Annual General
Meeting). Any Member interested in obtaining a copy of the said
statement may write to the Company Secretary at the Registered Office
of the Company.
16.3 The manpower strength of the Company as at the date of this Report
is 713.
17.0 Acknowledgement
Your Directors take this opportunity to express their deep sense of
appreciation for the invaluable contribution given and the spirit of
dedication shown by all the employees of the Company. The Directors
also place on record their deep gratitude for the business assistance,
co-operation and support extended to your Company by the Customers,
Distributors, Dealers, Suppliers, Service Providers, business partners,
Bankers, Government authorities. Agencies, Shareholders & all the
stakeholders. We look forward to their continued support and
co-operation in future. As we continue to grow and expand, we look
forward to sharing our success in the years ahead with all our
stakeholders.
For and on behalf of the Board
Place: Mumbai A. B. Advani
Date: 20th May, 2014 Executive Chairman
Mar 31, 2013
To The Members,
The Directors have pleasure in presenting the Sixtieth Annual Report of
the Company and the Audited Statement of Accounts for the year ended
31st March, 2013.
1.0 Financial Performance (Rupees in Crore)
Sr. Key Financial
Indicators For the year
ended For the year
ended For the year ended
No. 31st March,
2013 31st March,
2012 31st March, 2013
Standalone Consolidated *
1.1 Sales & other
Income 367.79 344.42 368.75
(Net of Excise Duty,
Discounts &
Incentives)
1.2 Profit before
Interest
and Depreciation 39.80 41.44 37.81
1.3 Profit before
Tax (PBT) 26.65 28.12 24.45
1.4 Provision
for Tax
(Net of deferred tax) 7.57 7,23 7.57
1.5 Profit for the
year after Tax (PAT) 19.08 20.89 16.88
1.6 Capital Expenditure 16.74 10.98 16.80
1.7 Capital - work in
progress 0.45 1.98 0.45
* M/s. Ador Welding Academy Pvt. Ltd. & M/s. Plasma Laser Technologies
Ltd. became the subsidiaries of the Company during the year 2012-13,
hence previous year''s consolidated figures are not given.
2.0 Dividend and Reserves
2.1 The Board of Directors is pleased to recommend a Dividend of 60%
(i.e. @ Rs.6/- per Equity Share) for the financial year 2012- 13,
subject to the approval of the Members. Dividend for the previous
financial year 2011-12 was declared @ 60% (i.e. @ Rs.6/- per Equity
Share).
2.2 The Dividend for the financial year 2012-13 shall Pe paid to those
Shareholders and Beneficial Owners whose names appear in the Register
of Members as on the record date for Dividend payment.
2.3 The Board recommends transfer of Rs, 1,91 Crore (Rs, 2.09 Crore)*
to the General Reserve, and the balance of Rs.36.99 Crore (Rs.29.36
Crore)* for retention in the Profit & Loss Account.
(''Figures in brackets indicate previous year).
3.0 Operations
In the financial year 2012-13, the Sales and other income went up by
6.78 %. The year ended with Sales and other income of Rs.367.79 Crore
(Rs.344.42 Crore)*.
The Company''s Sales and other Income during the financial year 2012-13
comprised of the following:
3.1 Welding Consumables at Rs.282.16 Crore (Rs. 262.81 Crore)* - In
spite of de-growth in the welding products manufacturing industry of
around 20% witnessed over last year due to unfavourable economic
conditions, Domestic Sales of Consumables recorded a growth of over 7%
compared to the previous year,
3 2 Equipment & Project Engineering at Rs.82.02 Crore (Rs.78.10 Crore)*
- Capital goods Industry witnessed de-growth of aPout 8% over last
year. However the Welding Equipment business was higher by over 5%
compared to the previous year,
3.3 Other Income at Rs.3.61 Crore (Rs. 3.51 Crore)*
(''Figures in brackets indicate previous year).
4.0 CAPEX
We completed CAPEX of Rs. 16.74 Crore and Rs. 0.45 Crore is in various
stages of progress. The entire CAPEX programme of financial year 2012-
13 shall be completed by the end of June 2013. For the financial year
2013-14 the CAPEX has been budgeted at about Rs. 33.00 Crore mainly
for-
(a) Consumables, Equipment and R&D.
(b) Production Equipment to balance lines for achieving capacity
production levels.
(c) Production related Equipment to improve in process quality and
deviation control towards six-sigma levels.
(d) Analytical Instruments for Equipment R&D.
(e) New Sales Offices.
(f) Additional Plots of land.
5.0 Subsidiary Company - Domestic
On 24th July 2012, your Company promoted Ador Welding Academy Pvt. Ltd.
as a wholly-owned Subsidiary Company, with a primary intent to set up a
national level welding academy to support manufacturing / construction
/ fabrication industry achieve higher value-add. It is an institute of
significance, offering wholesome support to the National policy on
skill development to harness the demographic dividend for building a
globally competitive manufacturing sector.
6.0 Subsidiary Company - Overseas
During the year under review, your Company acquired controlling equity
stake in M/s, Plasma Laser Technologies Ltd. (PLT), an overseas
Company, thereby making it a subsidiary of the Company.
PLT is in the business of manufacturing equipments from their patented
welding process that combines the application of Plasma and MIG welding
processes. The applications range from automobile, infrastructure to
ship Puilding and pressure part applications.
It is envisaged that the acquisition has the potential to create a
strong synergy for mutual growth and business excellence. It will
adequately catalyze our vision of creating a strong technical base for
the products & service delivery, to globalize our operations and to
strengthen our positioning, amongst the other industry players, in the
world market.
Further, there are two subsidiary companies of PLT, which are named
below:-
1. M/s. Aluminium Hybrid Systems Ltd. - formed for developing products
for Aluminum Plasma Welding.
2. M/s. Plasma Laser Technologies, North America, Inc. - formed for
carrying out Business Development Activities in North America.
By virtue of acquisition of majority equity stake in PLT (Holding
Company of above two subsidiaries), these two Companies have also
become subsidiary Companies of your Company.
7.0 Consolidated Financial Statements
The consolidated financial statements presented by the Company include
financial information of its subsidiaries prepared in compliance with
the applicable Accounting Standards. Pursuant to the circulars dated
February 8, 2011 & February 21, 2011 issued by the Ministry of
Corporate Affairs, a general exemption has been granted to the
companies from annexing the individual accounts of all the subsidiaries
along with the audited financial statements of the Company while
publishing the Annual Report, subject to certain conditions as
mentioned in the said circulars. Your Company meets all the conditions
stated in the aforesaid circulars and therefore the standalone
financial statements of each subsidiary will not be annexed with this
60th Annual Report of the Company for the year ended 31st March, 2013.
Accordingly, the annual accounts and other related information of the
subsidiary companies will be made available for inspection to the
shareholders of the Holding Company at the Registered office of the
Company and your Company shall furnish a hard copy of the details of
accounts of subsidiaries to any shareholder on demand.
8.0 Directors'' Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
Directors of the Company hereby confirm that:
8.1 In preparation of the Annual Accounts, all the applicable
Accounting Standards have been followed.
8.2 Proper accounting policies have been selected & applied them
consistently and made judgments & estimates that are reasonable and
prudent so as to give a true & fair view of the state of affairs of the
Company as at the end of the financial year and of the profits of the
Company for that period.
8.3 Proper & sufficient care has been taken for maintenance of adequate
accounting / Statutory Records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the Assets of the Company and for
preventing / detecting fraud & other irregularities.
8.4 Annual Accounts have been prepared on a going-concern basis.
9.0 Directors
9.1 During the FY 2012-13 the following changes occurred in the
composition of the Board of Directors of the Company:
(a) Mr. Raman Kumar''s contract as the Managing Director of the Company
expired on 10th May, 2012.
The Directors would like to place on record their sincere appreciation
for the contributions made by Mr. Raman Kumar during his tenure on the
Board and with the Company spanning over 35 years.
(b) The Board of Directors, in its meeting held on 26th April, 2012
appointed Mr. S. M. Bhat as an Additional Director and Managing
Director of the Company w.e.f. 11th May 2012, on retirement of Mr,
Raman Kumar. The shareholders thereafter approved Mr. S. M. Bhat''s
appointment as the Managing Director at the AGM held on 20,h July,
2012.
9.2 On 07th July, 2012, Mr. S.M. Bhat, the Managing Director of the
Company was conferred with the prestigious UDYOG RATNA Award by the
Institute of Economics Studies (IES) for his contribution and
excellence in the field of Infrastructure development through your
Company, Ador Welding Limited,
9.3 Mr. M. K. Maheshwari, Mr. R K. Gupta and Mr. A. T. Malkani,
Directors of the Company, retire by rotation, as per the Articles of
Association of the Company and are eligible for re-appointment.
9.4 The Board of Directors has received Form- DDA from all the above
named Directors, as prescribed under the Companies Disqualification of
Directors (under Section 274(1 )(g) of the Companies Act, 1956) Rules,
2003, informing the Company that they are not disqualified under
Section 274(1 )(g) of the Companies Act, 1956.
9.5 The Remuneration of the Executive Chairman has been restructured
within the limits specified in Schedule XIII to the Companies Act, 1956
and within the powers conferred by the Members to the Board.
10.0 Fixed Deposits
The Company has neither accepted nor renewed Fixed Deposits during the
financial year 2012-13.
11.0 Insurance
The properties / assets of the Company are adequately insured.
12.0 Energy conservation, Technology Absorption & Foreign Exchange
The information required under Section 217(l)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in Report of
the Board of Directors) Rules, 1988 with respect to conservation of
energy, technology absorption & foreign exchange earnings / outgo is
appended hereto as Annexure -1 and forms part of this Report,
13.0 Corporate Governance
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from the
financial year 2001-02 onwards. The Company has complied with all the
requirements of the Corporate Governance as per Clause 49 of the
Listing Agreement and a separate Report is attached herewith to this
Report as Annexure - II.
The Corporate Governance Compliance Certificate obtained from M/s.
Dalai & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached herewith, to this Report.
The Management Discussion and Analysis Report, as mandated under the
Code of Corporate Governance, is also attached to the Directors'' Report
as Annexure - III.
14.0 Auditor''s Report
There are no qualifications contained in the Auditor''s Report &
therefore there are no further explanations to be provided for in this
Report.
15.0 Statutory Auditors
The Company''s Statutory Auditors, M/s. Dalai & Shah, Chartered
Accountants, Mumbai, retire and are eligible for re-appointment.
16.0 Cost Auditors
Pursuant to the approval of the Central Government under Section 233B
of the Companies Act, 1956, the Board of Directors has appointed
Vishvesh Desai, Cost Accountant, Pune, as the Cost Auditor of the
Company for audit of cost accounting records of its "Automig Wires"
(Steel) under chapter heading 72 and all other products manufactured by
the Company, which are covered under Chapter 83 & 84 of the Central
Excise Tariff Act, 1985.
The brief information of the Cost Auditor and the Cost Audit Report is
as under:
16.1 Name of the Cost Auditor: CMA Vishvesh Desai
16.2 Address of the Cost Auditor: 10, Prabhakarsmruti CHS Ltd., 4th
Lane, Dahanukar Colony, Kothrud, Pune - 411 029, Maharashtra, India.
16.3 Membership No.: F-7330.
x16.4 Firm Regn. No. : 102151
16.5 Due date for filing Cost Audit Report (XBRL) for the financial
year 2011-12 by the Cost Auditor with the Central Government: 28th
February 2013.
16.6 Actual Date of filing of Cost Audit Report (XBRL) for the
financial year 2011-12 with the Central Government: 09th January, 2013.
17.0 Employees
17.1 The industrial relation in all the Plants and Offices of the
Company continues to be harmonious, cordial and peaceful.
17.2 The information required in terms of Section 217 (2A) of the
Companies Act, 1956, read with 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, this Annual Report
is being sent to all the Members of the Company excluding the said
statement of particulars of Employees (which is available for
inspection by any Member at the Registered Office of the Company during
working hours upto the date of the Annual General Meeting). Any Member
interested in obtaining a copy of the said statement may write to the
Company Secretary at the Registered Office of the Company.
17.3 The manpower strength of the Company as at the date of this Report
is 784.
18.0 Acknowledgement
Your Directors take this opportunity to place on record their warm
appreciation for the invaluable contribution given and the spirit of
dedication shown by the employees at all levels during the financial
year 2012-13. The Directors also express their deep gratitude for the
business assistance, co-operation and support extended to your Company
by its Customers, Distributors, Dealers, Suppliers / Service Providers,
Bankers, various Government Organisations / Agencies, Employees &
Shareholders and look forward to their continued support and
co-operation in future also,
For and on behalf of the Board
Place: Mumbai A. B. Advani
Date: 15th May, 2013 Executive Chairman
Mar 31, 2012
The Directors have pleasure in presenting the Fifty-Ninth Annual Report
of the Company and the Audited Statement of Accounts for the year ended
31st March, 2012.
1.0 Financial Performance (Rupees in Crore)
Sr. Key Financial Indicators For the year ended For the year ended
No. 31st March, 2012 31st March, 2011
1.1 Sales & other Income
(Net of Excise Duty, 344.42 297.41
Discounts & Incentives)
1.2 Profit before Interest and
Depreciation 41.44 48.90
1.3 Profit before Tax (PBT) 28.12 35.72
1.4 Provision for Tax (Net of
deferred tax) 7.23 10.02
1.5 Profit after Tax (PAT) 20.89 25.69
1.6 Capital Expenditure 10.98 10.14
1.7 Capital - work in progress 1.98 0.99
2.0 Dividend and Reserves
2.1 The Board of Directors is pleased to recommend a Dividend of 60%
(i.e. @ Rs6/- per Equity Share) for the financial year 2011-12, subject
to the approval of the Members. Dividend for the previous financial
year 2010-11 was declared @ 60% (i.e. @ Rs6/- per Equity Share).
2.2 The Dividend for the financial year 2011-12 shall be paid to those
Shareholders and Beneficial Owners whose names appear in the Register
of Members as on the date of the Book Closure for Dividend payment.
2.3 The Board recommends transfer of Rs2.09 Crore (Rs10.00 Crore)* to the
General Reserve, and the balance of Rs29.36 Crore (Rs20.01 Crore)* for
retention in the Profit & Loss Account. (*Figures in brackets indicate
previous year).
3.0 Operations
In the financial year 2011-12, the operational and other income went up
by over 16%. The year ended with an operational and other income of
Rs 344.42 Crore (Rs 297.41 Crore)*.
The Company's Sales and Other Income during the financial year 2011-12
comprised of the following:
3.1 Welding Consumables at Rs 262.81 Crore (Rs 223.45 Crore)*
3.2 Equipment & Project Engineering at Rs 78.10 Crore (Rs 71.75 Crore)*
3.3 Other Income at Rs 3.51 Crore (Rs 2.21 Crore)* (*Figures in brackets
indicate previous year).
4.0 Domestic Business
4.1 Consumables
The Sales / Business of Consumables recorded a volume growth of about
18% over the previous year. This was driven by a handsome increase in
volume sales of Special Electrodes and the volume sales of Wires &
Fluxes, in particular.
4.2 Equipment
The Sales / Equipment business grew by about 9% over the previous year.
This was driven by a big increase in PEB business, despite a drop of 6%
in the Welding Equipment Business, over the previous year.
5.0 Exports
During the year under review, the exports registered a growth of about
22% compared to the previous year. The Export Income during the
financial year 2011-12 was at Rs 33.95 Crore (Rs 27.82 Crore)*. The
growth in exports was achieved through both, Welding Consumables and
Equipment Business.
(*Figures in bracket indicate previous year).
6.0 CAPEX
We completed CAPEX of Rs 10.98 Crore and Rs 1.98 Crore are in various
stages of progress. The entire CAPEX programme of the financial year
2011-12 shall be completed by the end of June 2012. For the financial
year 2012-13, the CAPEX has been budgeted to Rs 24.30 Crore mainly for
-
(a) Consumables R&D and Materials Lab.
(b) Production Equipment to balance lines for achieving capacity
production levels.
(c) Production related Equipment to improve in process quality and
deviation control towards six-sigma levels.
(d) Analytical Instruments for Equipment R&D.
(e) Structural improvements to Ador House.
7.0 Directors' Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
Directors of the Company hereby confirms that:
7.1 In preparation of the Annual Accounts, all the applicable
Accounting Standards have been followed.
7.2 Proper accounting policies have been selected & applied them
consistently and made judgments & estimates that are reasonable and
prudent so as to give a true & fair view of the state of affairs of the
Company as at the end of the financial year and of the profits of the
Company for that period.
7.3 Proper & sufficient care has been taken for maintenance of adequate
accounting / Statutory Records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the Assets of the Company and for
preventing / detecting fraud & other irregularities.
7.4 Annual Accounts have been prepared on a going-concern basis.
8.0 Directors
8.1 During the FY 2011-12 the following changes occurred in the
composition of the Board of Directors of the Company:
(a) Mr. Raman Kumar was re-appointed as the Managing Director of the
Company
with effect from 19th October, 2011 for a period upto 10th May, 2012,
subject to the approval of the Members at the ensuing Annual General
Meeting of the Company. Mr. Raman Kumar would be superannuating on 10th
May, 2012. He was employed with the Company for over 35 years in
various capacities and was the Managing Director for over 3 years. We
thank him for his immense contribution towards the progress & growth of
the Company and extend our appreciation towards his valuable advise &
guidance.
(b) In view of the prospective retirement of Mr. Raman Kumar as the
Managing Director, the Board of Directors, at its meeting held on 26th
April, 2012 appointed Mr. S. M. Bhat, the President & COO, as an
Additional Director and designated him as the Managing Director of the
Company, effective 11th May 2012, for a period of 3 years. As an
Additional Director, Mr. S. M. Bhat is liable to retire at the
forthcoming Annual General Meeting. The Company has received a Notice
in writing from a Member proposing his candidature to the Office of
Director of the Company. In the interest of the Company's continued
prosperity and well-being, the Board recommends his re-appointment at
the forthcoming Annual General Meeting.
8.2 Mr. R. N. Sapru, Mr. K. Digvijay Singh and Mr. Anil Harish,
Directors of the Company, retire by rotation, as per the Articles of
Association of the Company and are eligible for re-appointment.
8.3 The Board of Directors has received Form- DDA from all the above
named Directors, as prescribed under the Companies Disqualification of
Directors (under Section 274(1)(g) of the Companies Act, 1956) Rules,
2003, informing the Company that they are not disqualified under
Section 274(1)(g) of the Companies Act, 1956.
8.4 The Remuneration of the Executive Chairman has been restructured
within the limits specified in Schedule XIII to the Companies Act, 1956
and within the powers conferred by the Members to the Board.
9.0 Fixed Deposits
The Company has neither accepted nor renewed Fixed Deposits in the
financial year 2011-12.
10.0 Insurance
The properties / assets of the Company are adequately insured.
11.0 Energy conservation, Technology Absorption & Foreign Exchange
The information required under Section 217(1)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in Report of
the Board of Directors) Rules, 1988 with respect to conservation of
energy, technology absorption & foreign exchange earnings / outgo is
appended hereto as Annexure - I and forms part of this Report.
12.0 Corporate Governance
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from the
financial year 2001-02 onwards. The Company has complied with all the
requirements of the Corporate Governance as per Clause 49 of the
Listing Agreement and a separate Report is attached herewith to this
Report as Annexure - II.
The Corporate Governance Compliance Certificate obtained from M/s.
Dalal & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached herewith, to this Report.
The Management Discussion and Analysis Report, as mandated under the
Code of Corporate Governance, is also attached to the Directors' Report
as Annexure - III.
13.0 Auditor's Report
There are no qualifications contained in the Auditor's Report &
therefore there are no further explanations to be provided for in this
Report.
14.0 Auditors
The Company's Statutory Auditors, M/s. Dalal & Shah, Chartered
Accountants, Mumbai, retire and are eligible for re-appointment.
15.0 Employees
15.1 The industrial relation in all the Plants and Offices of the
Company continues to be harmonious, cordial and peaceful.
15.2 The information required in terms of Section 217 (2A) of the
Companies Act, 1956, read with 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, this Annual Report
is being sent to all the Members of the Company, excluding the said
statement of particulars of Employees (which is available for
inspection by any Member at the Registered Office of the Company during
working hours upto the date of the Annual General Meeting). Any Member
interested in obtaining a copy of the said statement may write to the
Company Secretary at the Registered Office of the Company.
15.3 The manpower strength of the Company as at the date of this Report
is 789.
16.0 Acknowledgement
Your Directors take this opportunity to place on record their warm
appreciation for the invaluable contribution given and the spirit of
dedication shown by the employees at all levels during the financial
year 2011-12. The Directors also express their deep gratitude for the
business assistance, co-operation and support extended to your Company
by its Customers, Distributors, Dealers, Suppliers / Service Providers,
Bankers, various Government Organisations / Agencies, Employees &
Shareholders and look forward to their continued support and
co-operation in future also.
For and on behalf of the Board
Place: Mumbai A. B. Advani
Date: 26th April, 2012 Executive Chairman
Mar 31, 2011
The Directors have pleasure in presenting the Fifty-Eighth Annual
Report of the Company and the Audited Statement of Accounts for the
year ended 31st March, 2011.
1.0 Financial Performance (Rupees in Crore)
Sr. Key Financial Indicators For the year ended For the year ended
No. 31st March, 2011 31st March, 2010
1.1 Sales & other Income (Net
of Excise Duty, 297.41 265.37
Discounts &
Incentives)
1.2 Profit before Interest and
Depreciation 48.96 50.58
1.3 Profit before Tax (PBT) 35.77 36.90
1.4 Provision for Tax (Net of
deferred tax) 9.91 10.56
1.5 Profit for the year after
Tax (PAT) 25.86 26.34
1.6 Capital Expenditure 10.14 13.05
1.7 Capital - work in progress 1.57 0.42
2.0 Dividend and Reserves
2.1 The Board of Directors is pleased to recommend a Dividend of 60%
(i.e. @ Rs6/- per Equity Share) for the financial year 2010Ã11, subject
to the approval of the Members. Dividend for the previous financial
year 2009Ã10 was declared @ 60% (i.e. @ Rs6/- per Equity Share).
2.2 The Dividend for the financial year 2010-11 shall be paid to those
Shareholders and Beneficial Owners whose names appear in the Register
of Members as on the date of the Book Closure for Dividend payment.
2.3 The Board recommends transfer of Rs10.00 Crore (Rs7.00 Crore)* to the
General Reserve, and the balance of Rs20.01 Crore (Rs13.84 Crore)* for
retention in the Profit & Loss Account.
(*Figures in brackets indicate previous year).
3.0 Operations
In the financial year 2010-11, the operational and other income went up
by over 12%. The year ended with an operational and other income of
Rs297.41 Crore (Rs265.37 Crore)*.
The Companys Sales and Income during the financial year 2010-11
comprised of the following:
3.1 Welding Consumables at Rs222.85 Crore (Rs196.01 Crore)*
3.2 Equipment & Project Engineering at Rs71.53 Crore (Rs64.73 Crore)*
3.3 Other Income at Rs3.04 Crore (Rs4.63 Crore)* (*Figures in brackets
indicate previous year).
4.0 Domestic Business
4.1 Consumables
Domestic Sales of Consumables recorded a volume growth of 14% over the
previous year. This was driven by a handsome increase in volume sales
of Special Electrodes and the volume sales of Wires & Fluxes, in
particular.
4.2 Equipment
The Equipment business grew by 11% over the previous year. The Welding
Equipment numbers sold were 22% more than that of last year à driven by
a 45% increase in DC-MMAW Equipment sales numbers. The Project
Engineering Business just made past the last year level, as the order
flow improved only towards the end of the year by creating an order
inventory of over Rs400 Lacs; most of this will be executed in the first
quarter of this year.
5.0 Exports
During the year under review, the exports registered a growth of about
12% compared to the previous year. The Export Income during the
financial year 2010-11 was at Rs27.82 Crore (Rs24.82 Crore)*. The growth
in exports was achieved through Welding Consumables and Project Sales.
(*Figures in bracket indicate previous year).
6.0 CAPEX
We completed CAPEX of Rs10.14 Crore and Rs1.57 Crore are in various
stages of progress. The entire CAPEX programme of financial year
2010-11 shall be completed by the end of June 2011. For the financial
year 2011-12 the CAPEX has been budgeted to Rs22.00 Crore mainly for Ã
(a) Consumables R&D and Materials Lab.
(b) Production Equipment to balance lines for achieving capacity
production levels.
(c) Production related Equipment to improve in process quality and
deviation control towards six-sigma levels.
(d) Analytical Instruments for Equipment R&D.
(e) Structural improvements to Ador House.
7.0 Directors Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
Directors of the Company hereby confirm that:
7.1 In preparation of the Annual Accounts, all the applicable
Accounting Standards have been followed.
7.2 Proper accounting policies have been selected & applied them
consistently and made judgments & estimates that are reasonable and
prudent so as to give a true & fair view of the state of affairs of the
Company as at the end of the financial year and of the profits of the
Company for that period.
7.3 Proper & sufficient care has been taken for maintenance of adequate
accounting / Statutory Records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the Assets of the Company and for
preventing / detecting fraud & other irregularities.
7.4 Annual Accounts have been prepared on a going-concern basis.
8.0 Directors
8.1 During the financial year 2010-11 Mr. Vippen Sareen joined the
Board of Directors as an ÃAdditional Directorà with effect from 23rd
October, 2010. He joined the Board in place of Mr. J. N. Hinduja. As an
Additional Director, he is liable to retire at the forthcoming Annual
General Meeting. The Company has received Notice in writing from a
Member proposing his candidature to the Office of Director of the
Company. In the interest of the Companys continued prosperity and
well-being, the Board recommends his re- appointment at the forthcoming
Annual General Meeting.
8.2 Ms. A.B. Advani, Mrs. N. Malkani Nagpal and Mr. R. A. Mirchandani,
Directors of the Company, retire by rotation, as per the Articles of
Association of the Company and are eligible for re-appointment.
8.3 The Board of Directors has received Form DDA from all the above
named Directors, as prescribed under the Companies Disqualification of
Directors (under Section 274(1) (g) of the Companies Act, 1956) Rules,
2003, informing the Company that they are not disqualified under
Section 274(1)(g) of the Companies Act, 1956.
9.0 Fixed Deposits
The Company has neither accepted nor renewed Fixed Deposits in the
financial year 2010-11.
10.0 Insurance
The properties / assets of the Company are adequately insured.
11.0 Energy Conservation, Technology Absorption & Foreign Exchange
The information required under Section 217 (1) (e) of the Companies
Act, 1956, read with the Companies (Disclosure of Particulars in Report
of the Board of Directors) Rules, 1988 with respect to conservation of
energy, technology absorption & foreign exchange earnings / outgo is
appended hereto as Annexure - I and forms part of this Report.
12.0 Corporate Governance
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from the
financial year 2001Ã02 onwards. The Company has successfully complied
with all the requirements of the Corporate Governance as per Clause 49
of the Listing Agreement and a separate Report is attached herewith to
this Report as Annexure - II.
The Corporate Governance Compliance Certificate obtained from M/s.
Dalal & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached herewith to this Report.
The Management Discussion and Analysis Report, as mandated under the
Code of Corporate Governance, is also attached to the Directors Report
as Annexure - III.
13.0 Auditors Report
There are no qualifications contained in the Auditors Report &
therefore there are no further explanations to be provided for in this
Report.
14.0 Auditors
The Companys Statutory Auditors, M/s. Dalal & Shah, Chartered
Accountants, Mumbai, retire and are eligible for re-appointment.
15.0 Employees
15.1 The industrial relation in all the Plants and Offices of the
Company continues to be harmonious, cordial and peaceful.
15.2 The information required in terms of Section 217 (2A) of the
Companies Act, 1956, read with 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, this Annual
Report is being sent to all the Members of the Company excluding the
said statement of particulars of Employees (which is available for
inspection by any Member at the Registered Office of the Company during
working hours upto the date of the Annual General Meeting). Any Member
interested in obtaining a copy of the said statement may write to the
Company Secretary at the Registered Office of the Company.
15.3 The manpower strength of the Company as at the date of this Report
is 766.
16.0 Change in Shareholding
During the financial year 2010Ã11, M/s. J B Advani & Company Pvt. Ltd.,
the promoter / parent Company of the Company has acquired further
shares of the Company and has become the Holding Company since
February, 2011.
17.0 Acknowledgement
Your Directors take this opportunity to place on record their warm
appreciation for the invaluable contribution given and the spirit of
dedication shown by the employees at all levels during the financial
year 2010-11. The Directors also express their deep gratitude for the
business assistance, co-operation and support extended to your Company
by its Customers, Distributors, Dealers, Suppliers / Service Providers,
Bankers, various Government Organisations / Agencies, Employees &
Shareholders and look forward to their continued support and
co-operation in future also.
For and on behalf of the Board
Place: Mumbai A. B. Advani
Date: 29th April, 2011 Executive Chairman
Mar 31, 2010
The Directors have pleasure in presenting the Fifty-Seventh Annual
Report of the Company and the Audited Statement of Accounts for the
year ended 31st March, 2010.
1.0 Financial Performance (Rupees in Crore)
Sr. Key Financial
Indicators For the For the
year ended year ended
No. 31st March, 2010 31st March, 2009
1.1 Sales & other Income (Net of
Excise Duty,Discounts &
Incentives) 265.37 226.19
1.2 Profit before Interest and
Depreciation 50.58 37.09
1.3 Profit before Tax (PBT) 36.90 21.83
1.4 Provision for Tax (Net of
deferred tax) 10.56 9.26
1.5 Profit for the year after
Tax (PAT) 26.34 12.57
1.6 Capital Expenditure 13.05 15.14
1.7 Capital à work in progress 0.42 9.96
2.0 Dividend and Reserves
2.1 The Board of Directors is pleased to recommend a Dividend of 60%
(i.e. @ Rs. 6/- per Equity Share) for the financial year 2009Ã10,
subject to the approval of the Members. Dividend for the previous
financial year 2008Ã09 was declared @ 40% (i.e. @ Rs. 4/- per Equity
Share).
2.2 The Dividend for the financial year 2009-10 shall be paid to those
Shareholders and Beneficial Owners whose names appear in the Register
of Members as on the date of the Book closure for Dividend payment.
2.3 The Board recommends transfer of Rs. 7.00 Crore (Rs. 8.00 Crore)*
to the General Reserve, and the balance of Rs. 13.84 Crore (Rs. 4.75
Crore)* for retention in the Profit & Loss Account.
(*Figures in brackets indicate previous year).
3.0 Operations
In the financial year 2009-10, the operational and other income went up
by over 17%. The year ended with an operational & other income of Rs.
265.37 Crore (Rs. 226.19 Crore)*.
The CompanyÃs Sales and Income during the financial year 2009-10
comprised of the following:
3.1 Welding Consumables at Rs.196.01 Crore (Rs. 165.17 Crore)*
3.2 Equipment & Project Engineering at Rs. 64.73 Crore (Rs. 58.67
Crore)*
3.3 Other Income at Rs. 4.63 Crore (Rs. 2.36 Crore)* (*Figures in
brackets indicate previous year).
4.0 Domestic Business
4.1 Welding Consumables
Domestic Sales of Consumables recorded a volume growth of 57% over the
previous year. This was driven by aggressive Sales policies, market
demand and the expansion of our reach to more and more end-users /
project sites. Our product portfolio expansion in wires and fluxes,
were key to this success.
4.2 Welding Equipment and Project Engineering
The Welding Equipment / Accessories / spares volume business grew by
63% over the previous year. The Project engineering business grew by
50% over the last year. The volume growths were facilitated by the
strategic cost reduction projects successfully implemented across
most products for mass markets as well as aggressive sales initiatives
taken to increase market share.
5.0 Exports
During the year under review, there has been a decline in our exports
compared to the previous year. The Export Income during the financial
year 2009-10 was at Rs. 24.82 Crore (Rs. 32.76 Crore)*
Since our main exports have been to the Oil producing Gulf countries,
the slow-recovery in the oil-based economies in these countries has
adversely affected our business. Similarly impact of recession in UAE
has also contributed to the decline in the sale. We are in the process
of restructuring our business in countries of Saudi Arabia / Africa and
some of the South East Asian nations, with an effective distribution
system with pre-and-post sales support to the customers / end users.
(*Figures in bracket indicate previous year.)
6.0 CAPEX
We completed CAPEX of Rs.13.05 Crore and Rs. 0.42 Crore are in various
stages of progress. The entire CAPEX programme of FY 2009-10 shall be
completed by end of June 2010.
For the FY 2010-11 the CAPEX has been budgeted to Rs. 15 Crore mainly
for -
(a) Enhancement of Capacities in the Wire products.
(b) Lab Infrastructure / equipments required by Technology Development
Centers (TDCs) for development of new products etc.
(c) Strengthening IT infrastructure and replacement of old vehicles.
7.0 Directorsà Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
Directors of the Company hereby confirm that:
7.1 In preparation of the Annual Accounts, all the applicable
Accounting Standards have been followed.
7.2 Proper accounting policies have been selected & applied them
consistently and made judgments & estimates that are reasonable and
prudent so as to give a true & fair view of the state of affairs of the
Company as at the end of the financial year and of the profits of the
Company for that period.
7.3 Proper & sufficient care has been taken for maintenance of adequate
accounting / Statutory records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the Assets of the Company and for
preventing / detecting fraud & other irregularities.
7.4 Annual Accounts have been prepared on a going-concern basis.
8.0 Technology Development Centers
The Company has two (2) Technology Development Centers (TDCs) at
Silvassa in the Union Territory of Dadra & Nagar Haveli and at
Chinchwad (Pune) in Maharashtra for Consumables and Equipment
respectively, which are recognized by the Department of Scientific and
Industrial Research, Government of India. These TDCsà continue to
pursue their goals, with renewed vigour, in terms of innovations,
up-gradations, improvements and cost reductions. These TDCsà regularly
interact with the market / users for improving the competitive features
and performances of the CompanyÃs products.
9.0 Directors
9.1 During the FY 2009-10 Mr. J. N. Hinduja retired from the Board on
attaining superannuation at the age of 65 years on 30th March, 2010,
and thus ceased to be a Director of the Company.
Mr. J. N. Hinduja was appointed on 28th March, 2005 and was on the
Board of the Company for 5 years. We are grateful for his valuable
advice & guidance and appreciate his contributions towards the
CompanyÃs growth and prosperity.
9.2 Mr. A.T. Malkani, Mr. D.A.Lalvani and Mr. P. K.Gupta, Directors of
the Company, retire by rotation, as per the Articles of Association of
the Company and are eligible for re- appointment.
9.3 The Board of Directors has received Form DD- A from all the above
named Directors, as prescribed under the Companies Disqualification of
Directors (under Section 274(1)(g) of the Companies Act, 1956) Rules,
2003, informing the Company that they are not disqualified under
Section 274(1)(g) of the Companies Act, 1956.
10.0 Fixed Deposits
The Company has neither accepted nor renewed Fixed Deposits in the
financial year 2009-10.
11.0 Insurance
The properties / assets of the Company are adequately insured.
12.0 Energy Conservation, Technology Absorption & Foreign Exchange
The information required under Section 217 (1) (e) of the Companies
Act, 1956, read with the Companies (Disclosure of Particulars in Report
of the Board of Directors) Rules, 1988 with respect to conservation of
energy, technology absorption & foreign exchange earnings / outgo is
appended hereto as Annexure - I and forms part of this report.
13.0 Corporate Governance
As per the Listing Agreements executed with the Stock Exchanges, the
Company has been following the Corporate Governance Code from the
financial year 2001Ã02 onwards. The Company has successfully complied
with all the requirements of the Corporate Governance as per Clause 49
of the Listing Agreement and a separate Report is attached herewith to
this Report as Annexure - II.
The Corporate Governance Compliance Certificate obtained from M/s.
Dalal & Shah, Chartered Accountants, Mumbai, the Statutory Auditors of
the Company, is also attached to this Report
The Management Discussion and Analysis Report, as mandated under the
Code of Corporate Governance, is also attached to the Directorsà Report
as Annexure - III.
14.0 Auditors Report
There are no qualifications contained in the AuditorÃs Report &
therefore there are no further explanations to be provided for in this
Report.
15.0 Auditors
The CompanyÃs Statutory Auditors M/s. Dalal & Shah, Chartered
Accountants, Mumbai, retire and are eligible for re-appointment.
16.0 Employees
16.1 The industrial relation in all the Plants and Offices of the
Company continues to be harmonious, cordial and peaceful.
16.2 The information required in terms of Section 217 (2A) of the
Companies Act, 1956, read with 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, this Annual
Report is being sent to all the Members of the Company excluding the
said statement of particulars of Employees (which is available for
inspection by any Member at the Registered Office of the Company during
working hours upto the date of the Annual General Meeting). Any Member
interested in obtaining a copy of the said statement may write to the
Company Secretary at the Registered Office of the Company.
16.3 The manpower strength of the Company as at the date of this report
is 698.
17.0 Acknowledgement
Your Directors take this opportunity to place on record their warm
appreciation for the invaluable contribution given and the spirit of
dedication shown by the employees at all levels during the financial
year 2009-10. The Directors also express their deep gratitude for the
business assistance, co-operation and support extended to your Company
by its Customers, Distributors, Dealers, Suppliers / Service Providers,
Bankers, various Government Organisations / Agencies, Employees &
Shareholders and look forward to their continued support and
co-operation in future also.
For and on behalf of the Board
A. B. Advani
Executive Chairman
Place: Mumbai
Date: 29th May, 2010
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