Directors Report of John Cockerill India Ltd.
Mar 31, 2022
The Board of Directors of the Company are pleased to present the Thirty-Sixth Annual Report of John Cockerill India Limited (âthe Companyâ) on the business and operations of the Company together with the audited financial statements of the Company for the year ended March 31, 2022.
|
(Rs. in Lakhs) |
||
|
Particulars |
Financial Year |
Financial Year |
|
2021-2022 |
2020-2021 |
|
|
Total Income |
38,923.61 |
20,035.64 |
|
Profit before depreciation and amortisation expense, finance costs and tax expense |
1,593.91 |
(2,498.90) |
|
Less : |
||
|
Depreciation and amortisation expense |
466.17 |
503.32 |
|
Finance costs |
684.82 |
18.70 |
|
Profit / (Loss) before Tax |
442.92 |
(3,020.92) |
|
Less : Tax expense : |
||
|
Current tax |
(7.75) |
- |
|
Deferred tax |
(13.35) |
(114.71) |
|
Profit / (Loss) for the year |
464.02 |
(2,906.21) |
|
Other comprehensive income for the year, net of tax |
39.68 |
(59.17) |
|
Total comprehensive income for the year |
503.70 |
(2,965.38) |
OVERVIEW OF COMPANYâS FINANCIAL PERFORMANCE Operating Review
At the beginning of the financial year in April 2021, India was impacted with the 2nd wave of COVID-19 pandemic with nearly 7 million new cases being reported in April 2021. The 2nd wave started to recede from June 2021 onwards but continued till September 2021 with less than 30,000 cases being reported per day. Thus, for a significant part of the year, the overall economic activity in the country was highly impacted. However, since the project activities at our major customer sites were running, in spite of significant disruptions in the supply chain, the equipment deliveries for the major running projects have been completed to the extent of more than 85%. As a result of increased business activities, the revenue from operations has increased to '' 382.78 crores in FY2021-22 from '' 198.06 crores in FY 2020-21 and the Company have managed to achieve profit before tax of '' 4.43 crores in FY 2021-22 as against loss of '' 30.21 crores in FY 2020-21.
In March 2022, the Company has won the largest order in its history for a value of more than '' 1,000 crores for supply of 2 processing lines to ArcelorMittal Nippon Steel India Limited. With the return of economic activity, the overall steel demand has been increasing gradually With the Indian steel industry demonstrating a V-shaped recovery in steel production and special emphasis from the Government on infrastructure development through schemes such as PM Gati Shakti Plan, National Infrastructure Pipeline (âNIPâ), Bharatmala Project etc., steel production is poised for significant growth in coming years. The existing customers of the Company such as Tata Steel and JSW have announced significant capital expenditure plans of more than '' 35,000 crores, a bulk of which will be spent on capacity expansion. Under the âPanchamrita planâ laid before United Nations Framework Convention (CoP26) in
November 2021, India has announced its targets to reduce the carbon intensity of its economy by 45% in 2030. This will open up opportunities for the Company to provide solutions in âDe-carbonisationâ of steel manufacturing process and use of green Hydrogen in steel making process. The Company is observing this market and is geared up to grab the opportunities with support from John Cockerill SA, its majority shareholder.
The Company is actively pursuing further new orders worth a few hundred crores from some domestic and overseas customers, which are in advanced stages. Apart from this, the Company is working on several back-up opportunities worth sizeable amounts, where technical and commercial discussions are going on with various prospective customers.
Material Changes and Commitments
There are no material changes and commitments affecting the financial position of the Company which has occurred between the close of the financial year on March 31, 2022 to which the financial statements relates and date of this report. There has been no change in the nature of business of the Company
The Board of Directors, at its meeting held on May 26, 2022, have recommended a final dividend for the financial year 2021-22 at the rate of '' 2/- per equity share having face value of '' 10/- each amounting to '' 98.76 lakhs. The dividend will be paid after approval of the members at the ensuing Annual General Meeting (âAGMâ) of the Company The Tax Deducted at Source (âTDSâ) will be deducted by the Company, wherever applicable, as per the provisions of the Income Tax Act, 1961.
The Board of Directors decided not to transfer any amount to the General Reserve for the year under review.
The name of the Holding Company has changed from Cockerill Maintenance and Ingenerie SA (CMI SA) to John Cockerill SA. The registered office address of John Cockerill SA has also been changed to Rue Jean Potier 1, 4100 Seraing, Belgium. John Cockerill SA is part of the John Cockerill Group having interest in sectors like Energy Defence, Industry Environment and Services. The Company is a part of the Industry Sector of the John Cockerill Group.
The Company continues to have close, collaborative relationship with customers supported by an extended global manufacturing network aligned with customer locations. John Cockerill Group focuses on R & D activities, investments have been made to support long-term profitable growth and extending help to the customers in value creation.
The John Cockerill Group has been extremely supportive of their Indian operations and continues to provide constant support in terms of technology research and development, systems, manufacturing, human resources, etc.
COMPANYâS RESPONSE TO COVID-19
Globally COVID-19 crisis continued to impact during the part of the year 2021-22 as well. The unprecedented health crisis triggered by the COVID-19 pandemic not only posed a significant threat to human life but also impacted livelihood. After combating the first wave of coronavirus, the second and third wave continued to impact life and business. Vaccination has had a crucial role in restricting the impact of COVID-19, restoring confidence in the economy, and decreasing the effects of coronavirus on India''s economy
The Company embarked on a voluntary vaccination drive covering the employees and their family members by providing vaccines in collaboration with top-quality healthcare organisation to ensure the good health and well-being of its people. This was timely and appreciated by the families as well and it gave an impetus to our employees to come to work.
Both the factories worked efficiently during the year despite the continuation of COVID-19 pandemic. Safety measures and processes have been installed and improved upon at all factories and work sites. Necessary safety and hygiene protocols like wearing of face masks, social distancing norms, workplace sanitation and employee awareness programmes were followed in compliance with the regulations of the local authorities. While âwork-from-homeâ has been discontinued and all employees are now working from offices, the related infrastructure has been preserved and the Company is geared up to adopt to a flexible working mode whenever required.
SUBSIDIARY COMPANIES AND FINANCIAL STATEMENTS
The Company does not have any subsidiaries and hence no details need be provided in Form AOC-1.
In accordance with the provisions of Section 136 of the Companies Act, 2013 (âthe Actâ), the audited financial statements and related information of the Company are available on the website of the Company at www.johncockerillindia.com.
The paid-up equity share capital of the Company as on March 31, 2022 is '' 493.78 lakhs. During the year under review, the Company has neither issued any shares (including shares with differential voting rights) nor granted stock options or sweat equity
During the year under review, the Company has neither accepted nor renewed any deposit within the meaning of Section 73 of the Act and the Companies (Acceptance of Deposits) Rules, 2014.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The Company was not required to transfer any amount to Investor Education and Protection Fund (âIEPFâ) during the year under review.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
During the year under review, the Company has not provided any loan or guarantee or made investments covered under the provisions of Section 186 of the Act and Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ).
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Corporate Social Responsibility (âCSRâ) Policy of the Company is in alignment with the requirements of the Act. Pursuant to the provisions of Section 135 of the Act, the Company has constituted a CSR Committee to monitor the CSR activities of the Company, details of which are provided in the Corporate Governance Report, forming part of this Report.
The Company is committed to CSR and strongly believes that the business objectives of the Company must in congruence with the legitimate development needs of the society in which it operates. During the year under review, the Company incurred CSR expenditure of '' 40.15 lakhs - which was more than the statutory minimum of ''39.34 lakhs required to be spent by the Company The Company has supported educational opportunities for children and youth, as well as those coming from a disadvantaged background. The Company believes that these CSR initiatives should be sustainable and with the long-term purpose of improving the quality of living for the less privileged and for increasing social assets. The funds are being carefully spent on such CSR projects that will result in the ultimate objectives stated in the Company''s CSR policy The Annual Report on CSR is attached as Annexure 1.
The CSR projects of the Company are focused in the areas of environment and sustainability healthcare, promotion of education and skill development. The Company has created a tab on the home page of the Company''s website for CSR related information to be displayed. The information related to CSR Committee, CSR policy and the projects undertaken by the Company are updated there regularly
The Chief Financial Officer of the Company has certified to the Board that the funds disbursed for CSR activities were utilized for that purpose.
Due to various waves of COVID-19 pandemic, movement of CSR team faced many challenges in the year 2020-21, despite best efforts, while executing various CSR projects undertaken by the Company which resulted into a shortfall from the amount prescribed under the Act. The shortfall amount of ''59.39 lakhs were transferred to Unspent CSR account to be spent on ongoing projects identified by the Company for health and education in a phased manner. The CSR Committee recommended the annual action plan which was approved by the Board. During the year under review, the Company had spent '' 14.16 lakhs out of the unspent amount of '' 59.39 lakhs. The balance unspent amount of '' 45.23 lakhs will be spent in the next two years.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL Retirement by rotation
In accordance with the provisions of the Act and the Articles of Association of the Company, Mr. Jean Gourp (DIN 02268912), NonExecutive Director of the Company is liable to retire by rotation at the ensuing Annual General Meeting (âAGMâ) of the Company and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment.
During the year under review, Dr. Urjit Patel (DIN 00175210) resigned as a Director of the Company with effect from January 31,2022. The Board of Directors of the Company, placed on record its appreciation for the contribution made by Dr. Urjit Patel as Director of the Company during his short association with the Company.
The Board at its meeting held on March 18,2022, on the recommendation of the Nomination and Remuneration Committee appointed Mr. Praveen Kadle (DIN 00016814) as Additional Director of the Company with effect from April 1,2022. As mandated by Regulation 17(1C) of the Listing Regulations, applicable from January 1, 2022, the appointment of Mr. Praveen Kadle was approved by the members of the Company through Postal Ballot on April 22, 2022. The details of Postal Ballot process and results is provided in the Corporate Governance Report, which forms part of this Report.
Re-appointment of Managing Director
The current term of Mr. Vivek Bhide as the Managing Director of the Company will expire on February 7, 2023. At the meeting held on May 26, 2022, the Board of Directors, acting on the recommendation of the Nomination and Remuneration Committee, have approved his reappointment for a further period of 5 (five) years, on revised terms of remuneration for a period of 3 (three) years, etc., subject to the approval of the members of the Company, and of the Central Government, if required. The necessary resolution for his re-appointment is being placed before the members for approval. The Board recommends the re-appointment of Mr. Vivek Bhide to the members for their approval at the ensuing AGM.
Detailed profile of the Directors seeking appointment / re-appointment along with other necessary details as required are provided in the Notice of the Thirty-Sixth Annual General Meeting of the Company.
Apart from the aforesaid changes, there are no changes in the Directors and Key Managerial Personnel of the Company. The details of the number and dates of meetings held by the Board and its Committees, attendance of Directors and remuneration paid to them are given separately in the Corporate Governance Report which forms a part of this Report.
Key Managerial Personnel
The following were the Key Managerial Personnel (âKMPâ) of the Company in full compliance with the provisions of Section 203 of the Act during the year ended March 31, 2022 :
i) Mr. Vivek Bhide Managing Director
ii) Mr. Kiran Rahate Chief Financial Officer
iii) Mr. Haresh Vala Company Secretary
Declaration by the Independent Directors
All the Independent Directors have submitted the declaration of their independence, stating that they continue to fulfil the criteria of
independence as required pursuant to Section 149 of the Act and the Listing Regulations. The Independent Directors have also confirmed that they are not aware of any circumstance or situation, which exist 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. Further the Board after taking these declaration / disclosures on record and acknowledging the veracity of the same, opined that the Independent Directors are persons of integrity and possess the relevant expertise and experience, fulfils the conditions specified in the Listing Regulations and the Act for appointment of Independent Directors and are independent of the management.
The Independent Directors have confirmed that their names have been included in the data bank of Independent Directors as prescribed under the Act.
Performance Evaluation of the Board
Pursuant to the provisions of the Act and the Listing Regulations, the Board has carried out an evaluation of its own, its Directors individually as well as the evaluation of its working of its Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
The Board and the Nomination and Remuneration Committee confirmed that the performance evaluation was completed during the year under review.
Chairman held a one-on-one meeting with each of the individual Independent Directors as a part of self-appraisal and peer-group evaluation; the engagement and impact of individual Director was reviewed on parameters such as attendance, knowledge and expertise, inter-personal relationship, engagement in discussion and decisionmaking process, actions oriented and others. The Directors were also asked to provide their valuable feedback and suggestions on the overall functioning of the Board and its Committees and the areas of improvement for a higher degree of engagement with the Management.
Meeting of Independent Directors
The Independent Directors of the Company met on February 3, 2022 without the presence of the Chairman, Managing Director, other NonIndependent Directors or any other managerial personnel.
Familiarisation Programme for Directors
The Company has in place a familiarisation programme for the Directors (including Independent Directors) to familiarise them with their roles, rights, responsibilities, nature of the Industry Company''s strategy, business plan, operations, markets, products, etc. The details of the Company''s familiarisation programme is available on the Company''s website at www.johncockerillindia.com, and is also dealt in detail in the Corporate Governance Report.
The Company follows a policy on the remuneration of the Directors and Senior Management employees. The policy is approved by the Nomination and Remuneration Committee and the Board. The main objective of the said policy is to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Directors, KMP and Senior Management employees. The remuneration involves a balance between fixed and incentive components, reflecting short and long term performance objectives appropriate to the working of the Company and its goals. The
remuneration policy is available on the website of the Company - www. johncockerillindia.com.
The details of the Remuneration Policy are mentioned in the Corporate Governance Report which forms a part of this Report.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134 of the Act, the Board of Directors, to the best of their knowledge and ability confirm that :
a. in the preparation of the annual accounts, the applicable Accounting Standards have been followed and that no material departures have been made from the same;
b. they have selected such accounting policies as mentioned in the Notes to the financial statements and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the Statement of Profit and Loss and Cash Flow of the Company for the year ended on that date;
c. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual accounts have been prepared on a ''going concern'' basis;
e. proper internal financial controls to be followed by the Company have been instituted, that such internal financial controls are adequate and were operating effectively; and
f. proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems are adequate and are operating effectively.
5 (five) Board Meetings were held during the year 2021-22 on May 27,
2021, August 3, 2021, October 28, 2021, February 4, 2022 and March 18,
2022. The Thirty-Fifth Annual General Meeting of the Company was held on August 4, 2021 through video conferencing.
Details of the meetings are provided in the Corporate Governance Report which forms a part of this Report. The intervening gaps between the meetings were within the limits prescribed under the Act and the Listing Regulations.
The Company has duly constituted the Committees required under the Act read with the applicable Rules made thereunder and the Listing Regulations, and also a few other Committeesâ though not mandatory As on March 31,2022, the following Committees of the Board were functional :
i. Audit Committee
ii. Stakeholders Relationship Committee
iii. Nomination and Remuneration Committee
iv. Corporate Social Responsibility Committee
v. Risk Management Committee
vi. Borrowings Committee
vii. Banking Operations Committee
The details with respect to the composition of the Committees, their terms of reference and attendance at the meetings of the aforesaid Committees of the Board are given in the Corporate Governance Report which forms a part of this Report.
At the Thirty-Second AGM held on July 27, 2018, the members of the Company had appointed M/s. S R B C & Co. LLP, Chartered Accountants (ICAI Registration No. 324982E/E300003) as the Statutory Auditors of the Company for an initial term of five years till the conclusion of the Thirty-Seventh AGM of the Company to be held in the year 2023. In accordance with the Companies Amendment Act, 2017, enforced by the Ministry of Corporate Affairs on May 7, 2018, the appointment of the Statutory Auditors is not required to be ratified at every Annual General Meeting.
The Statutory Auditors have confirmed that they comply with all the requirements and criteria and are qualified to continue to act as the Statutory Auditors of the Company
M/s. S R B C & Co. LLP have issued their Independent Auditors Report on the financial statements for the financial year ended March 31, 2022 and they have made no qualification, reservation or adverse remark or disclaimer in their Report. The Notes thereto are self-explanatory and do not require any explanations from the Board.
During the year under review, the Statutory Auditors have not reported any instances of fraud committed against the Company by its Officer or employees as specified under Section 143(12) of the Act and therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
Pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Board, on the recommendation of the Audit Committee, appointed M/s. Kishore Bhatia & Associates, Cost Accountants (Firm Registration No. 000294) as the Cost Auditors of the Company for conducting the cost audit for the financial year 2022-23 and has recommended their remuneration to the shareholders of the Company for their ratification at the ensuing AGM. M/s. Kishore Bhatia & Associates have given their consent to act as Cost Auditors and confirmed that their appointment is within the limits of Section 139 of the Act. They have also certified that they are free from any disqualifications specified under Section 141 of the Act. The Audit Committee has also received a certificate from the Cost Auditors certifying their independence and arm''s length relationship with the Company Pursuant to the Companies (Cost Records and Audit) Rules, 2014, the Cost Audit Report for the financial year ended March 31, 2021, was filed with the Central Government before the due date.
During the year under review, the Cost Auditor had not reported any matter under Section 143(12) of the Act, and therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
The Board had appointed M/s. VKM & Associates, a firm of Company Secretaries in Practice (Certificate of Practice No. 4279) to carry out the Secretarial Audit of the Company under the provisions of Section 204 of the Act. The Company had received consent from M/s. VKM & Associates to act as the Secretarial Auditor for conducting the audit of the Secretarial records for the financial year ended March 31, 2022.
The Secretarial Audit Report for the financial year ended March 31,2022 has been annexed as Annexure 2 to this Report.
The Company has undertaken an audit for the financial year ended March 31, 2022 for all applicable compliances as per applicable SEBI Regulations / circulars / guidelines issued thereunder, pursuant to requirement of the Listing Regulations. The Annual Secretarial Compliance Report duly issued by M/s. VKM & Associates has been annexed as Annexure 3 to this Report.
There is no qualification, reservation, adverse remark or disclaimer by the Secretarial Auditor in their Secretarial Audit Report and therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
HUMAN RESOURCES AND PARTICULARS OF EMPLOYEES
The Company believes that one of its biggest assets is its human resources. The Company is committed to the holistic development including mental health and well-being of its employees. The Company believes that human resources contribute a lot towards the success of the organisation and hence the Company puts in a lot of emphasis in nurturing this valuable asset. An organisational culture that encourages employees for active and energetic participation can go a long way towards the growth of the organisation and the Company puts in all the necessary efforts to create such a culture. A detailed note on Human Resources is provided in the Management Discussion and Analysis (âMDAâ) Report, which forms part of this Report.
The statement of disclosures of remuneration 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, as amended from time to time, is annexed as Annexure 4 and forms an integral part of this Report.
The information regarding employee remuneration as required pursuant to Rule 5(2) and 5(3) of the above Rules is available for inspection. A statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules will be provided upon request. In terms of first proviso to Section 136 of the Act, the Report and Accounts are being sent to the members and others entitled thereto, excluding the information on employees'' particulars, which is available for inspection by the members. Any member interested in obtaining a copy thereof may write to the Company Secretary.
None of the employees listed in the said Annexure is related to any Director of the Company. None of the employees holds (by himself or along with his / her spouse and dependent children) more than 2% of the equity shares of the Company.
The Company is committed to Health and Safety of its employees, contractors and visitors. The details on Health and Safety are provided in the MDA Report, which forms part of this Report.
Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
In line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (âPOSHâ) and the Rules made thereunder, the Company has adopted a policy for the same. The Company has constituted an Internal Committee with internal members, and Mrs. Gauri Nilakantan (who has extensive experience in this field) as an external member of the Committee.
All employees, especially women employees, were made aware of the Policy and the manner in which the complaints can be lodged.
The following is reported pursuant to Section 22 of the POSH and Regulation 34(3) read with sub-clause 10(1) of Clause C of Schedule V of the Listing Regulations for the year ended March 31, 2022 :
|
a. |
Number of complaints of sexual harassment received / filed during the year |
Nil |
|
b. |
Number of complaints disposed of during the year |
Nil |
|
c. |
Number of complaints pending for more than ninety days |
Nil |
|
d. |
Number of complaints pending as on end of financial year |
Nil |
|
e. |
Number of workshops or awareness programs carried out |
2 |
|
f. |
Nature of action taken by the employer or District officer |
Not Applicable |
During the year under review, no case of sexual harassment in the Company was reported.
As per the amended Listing Regulations, constitution of a Risk Management Committee is not mandated to the Company. However, in line with the best global practices, and aligned with the Risk Management Policy of John Cockerill SA (the holding Company), the Board of Directors has voluntarily constituted a Risk Management Committee in 2014, has evolved a Risk Management Policy, and has developed the operating guidelines governing the functioning of this Committee.
The Committee oversees the Risk Management process including risk identification, impact assessment, effective implementation of the mitigation plans, risk reporting and carries out other related activities. The purpose of the Committee is to assist the Audit Committee in fulfilling its oversight responsibilities with regard to enterprise risk management.
The composition and terms of reference of the Risk Management Committee are covered under the Corporate Governance Report, which forms part of this Report. Important elements of risk are discussed in the MDA Report, which forms part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The establishment of an effective internal control system is essential for sustainable growth and long-term improvements in corporate value, and accordingly, the Company works to strengthen such structures. The Company believes that a strong internal control framework is an important pillar of Corporate Governance.
The current system of internal financial controls is aligned with the requirements of the Act and is in line with globally accepted risk-based framework as issued by the Committee of Sponsoring Organisations (CoSO) of the Treadway Commission. The framework includes entity-level policies, processes and Standard Operating Procedures (SOP). Compliance with these polices and procedure is ingrained into the management review process. Moreover, the Company regularly reviews them to ensure both the relevance and comprehensiveness of the internal financial controls.
The Company periodically assesses the design as well as operational effectiveness of its internal controls across multiple functions and locations through internal audit exercises. Based on the assessment of internal audit function, process owners undertake corrective action in their respective areas, and thereby strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. Based on its evaluation (as provided under Section 177 of the Act and Clause 18 of the Listing Regulations), the Audit Committee has concluded that as on March 31, 2022, the Internal Financial Controls were adequate and operating effectively
M/s. S R B C & Co. LLP, Statutory Auditors of the Company have audited the financial statements included in this Annual Report and have issued a report on the internal controls over financial reporting (as defined in Section 143 of the Act).
The details and the process of internal control systems, as implemented by the Company are provided in the MDA Report, which forms part of this Report.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The Company has over the years, established a reputation for conducting business with integrity and displays zero tolerance for any unethical behaviour. The Company believes that potential risk of fraud, corruption and unethical behaviour could adversely impact the Company''s business operations, performance and reputation. With a view to create ethical environment and to mitigate the risk of fraud, a Whistle Blower Policy has been laid down to provide for adequate safeguard against victimization of Directors and employees who use the mechanism. The Whistle Blower Policy can be assessed on the Company''s website at https://johncockerillindia.com/financialreport. aspx?Subcat=Whistleblower%20Policy&InvestorType=Policies.
The policy encourages Directors, employees and third parties to bring to the Company''s attention, any instances of illegal or unethical conduct, actual or suspected incidents of fraud, actions that affects the operational and financial integrity and actual or suspected instances of leak of unpublished price sensitive information that could adversely impact the operations, business performance and / or reputation.
During the year under review, the employees were encouraged to report any incidents and were informed about the availability of direct access / approach to the Chairman of the Audit Committee, wherever necessary It is confirmed that no personnel of the Company in the context of whistle blowing, has been denied access to the Chairman of the Audit Committee.
The Company has laid down a robust Code of Conduct, which is based on the principles of ethics, integrity and transparency More details about the Code of Conduct are given in the Corporate Governance Report.
COMPLIANCE WITH SECRETARIAL STANDARDS ON BOARD AND ANNUAL GENERAL MEETINGS
The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by The Institute of Company Secretaries of India, that such systems are adequate and are operating effectively. During the year under review, the Company was in compliance with the Secretarial Standards i.e. SS-1 and SS-2, relating to âMeetings of the Board of Directorsâ and âGeneral Meetingsâ respectively
The Company has taken adequate insurance coverage of all its assets and inventories against various types of risks viz. fire, floods, earthquake, cyclone, etc. and also transit insurance to cover the risk during transportation of goods from its plants to customer project sites.
Directors'' & Officers'' Liability (D & O) policy covers the Directors and Officers of the Company against the risk of third-party claims arising out of their actions / decisions in the normal course of discharge of their duties, which may result in financial loss to any third party
The employees of the Company are covered under various employee benefit Group insurance schemes that provide cover for Hospitalization, Accidental Disability and Death.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy on Related Party Transactions, which is available on the Company''s website at https://johncockerillindia. com/financialreport.aspx?Subcat=RPT%20Policy%20as%20per%20 LODR&InvestorType=Policies
All the related party transactions entered into by the Company during the financial year were on arm''s length basis and in the ordinary course of business and adhered to the applicable provisions of the Act and the Listing Regulations. There were no materially significant related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel or others, which may have a potential conflict with the interest of the Company at large. No material contracts or arrangements with related parties were entered during the year. All related party transactions were presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are repetitive in nature and also for the transactions which are not foreseen (subject to financial limit).
A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.
John Cockerill SA (formerly CMI SA) is the Holding Company of the Company, and all the subsidiaries of John Cockerill SA are treated as related parties of the Company Such related party transactions, including those with the Holding Company and fellow subsidiaries, which have been carried out during the current year and previous year are mentioned in the Annual Report in accordance with the Indian Accounting Standards 24 on Related Party Transactions notified by the Companies (Indian Accounting Standards) Rules, 2015, as amended, and are not repeated in this Report of the Directors. None of the related party transactions entered into by the Company was in conflict with the Company''s interests.
In compliance with the provisions of Regulation 34(3) read with Schedule V(A) of the Listing Regulations read with Section 134(3)(h) of the Act, it is confirmed that no loans or advances in the nature of loans have been received or paid to the Holding Company or any Fellow Subsidiary or any Director or to any firms or companies in which a Director is interested and no investments have been made in the shares of the Holding Company or any of its subsidiaries. The Company does not have any subsidiaries. The Company has no investments. The prescribed disclosure in Form AOC-2 in terms of Section 134 of the Act is not required.
At the Thirty-Fifth AGM held on August 4, 2021, the members of the Company approved the material related party transactions with CMI SA
(name changed to John Cockerill SA), John Cockerill Automation Private Limited and Beijing Cockerill Trading Company Limited (name changed to John Cockerill Trading (Beijing) Company Limited) for transactions over a period of 3 years which are to be considered material in terms of the Listing Regulations.
The approval of the members of the Company is sought in terms of the Listing Regulations for the payment of Brand fee @ 0.6% of the external sales and for the payment of 3% technical royalty fees to John Cockerill SA on those portions of contracts assigned to the Company through John Cockerill SA and also for other Related Party Transactions with various Related Parties.
None of the Directors and the Key Managerial Personnel has any pecuniary relationship or transactions with the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There have been no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in future.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information pertaining to energy conservation, technology absorption, foreign exchange earnings and outgo, as required under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in Annexure 5, and forms an integral part of this Report.
The Company believes in attainment of highest levels of transparency in all facets of its operations and maintains an unwavering focus on imbibing good Corporate Governance practices. The Company continues to strengthen its governance principles to generate long-term value for its various stakeholders on a sustainable basis through ethical leadership both at the Board and at the Management levels.
A report on Corporate Governance, and a Certificate from M/s. S R B C & Co. LLP, Chartered Accountants, Statutory Auditors of the Company regarding the compliance with the conditions of Corporate Governance, as stipulated under the Schedule V of the Listing Regulations, is attached to the Report of Corporate Governance.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 read with Schedule V of the Listing Regulations is presented in a separate section, forming part of this Annual Report.
During the year under review, the Company has continued the âdigital platformsâ for various meetings including the Board and Committee meetings, internal meetings and meetings with external stakeholders such as customers and vendors. This has helped the Company to reduce multiple sector travel from Europe and from within India for the Directors and others - several times a year - thereby reducing gas / carbon emission and dissemination of information in paper form for various meetings. All the employees, the Board members and external stakeholders have adapted to the new tools & platforms quickly and the experience of adopting a nearly âall-digitalâ process for all meetings keeps getting better.
Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, copies of the Annual Return of the Company prepared in accordance with Section 92(1) of the Act read with Rule 11 of the Companies (Management and Administration) Rules, 2014 are placed on the website of the Company - www.johncockerillindia.com. This extract is also annexed as Annexure 6 and forms an integral part of this Report.
The Directors place on record their deep appreciation to every member of John Cockerill family for the hard work, dedication and commitment, to whom the credit for the Company''s achievements goes, particularly during this unprecedented time. The Directors would also like to acknowledge the valuable contribution by the Company''s Promoters, John Cockerill SA, in achieving continuous improvement in business practices.
The Company looks upon its suppliers, distributors, retailers, business partners and others associated with it as Partners in its progress, and the Board places on record its appreciation for the support and cooperation from all of them. The Directors take this opportunity to express their deep sense of gratitude to the Banks, Auditors, Government and Regulatory authorities, both at Central and State level, for their continued guidance and support.
The Directors also wish to place on record their appreciation of the contributions made by employees at all levels and look forward to their support in future as well.
And to the shareholders, the Directors are deeply grateful for the confidence and faith reposed by them.
Mar 31, 2018
Dear Members,
The Directors are pleased to present the Thirty Second Annual Report on the business and operations of the Company, together with the audited financial statements for the year ended March 31, 2018.
1. FINANCIAL PERFORMANCE
(Rs. in lakhs)
|
Particulars |
Financial Year 2017-2018 |
Financial Year 2016-2017 |
|
Total Income |
32,450.76 |
17,190.32 |
|
Profit before depreciation and amortisation expense, finance costs and |
2,008.52 |
1,408.00 |
|
tax expense |
||
|
Less: |
||
|
Depreciation and amortisation expense |
592.32 |
518.55 |
|
Finance costs |
90.99 |
103.12 |
|
Profit / (Loss) before Tax |
1,325.21 |
786.33 |
|
Less : Tax expense: |
||
|
Current tax |
201.63 |
117.03 |
|
Deferred tax |
451.58 |
90.25 |
|
Profit / (Loss) for the year |
672.00 |
579.05 |
|
Other comprehensive income for the year, net of tax |
(90.18) |
(30.59) |
|
Total comprehensive income for the year |
581.82 |
548.46 |
As mandated by the Ministry of Corporate Affairs, the Company has adopted the Ind AS for the financial year commencing from April 1, 2017. The estimates and judgments relating to the financial statements are made on prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Companyâs state of affairs, profits and cash flows for the year ended March 31, 2018.
2. OVERVIEW OF COMPANYâS FINANCIAL PERFORMANCE
Operations
The year under review was the year of positive turnaround for the Company. Your Company has shown a substantial growth in the total revenue by 88.77% to Rs. 32,450.76 lakhs in the year under review as compared to Rs. 17,190.32 lakhs in the previous year. The strategic change in the operations and execution of the projects has resulted in the increase of net profit after tax by 16.05% to Rs. 672 lakhs in the year under review as compared to Rs. 579.05 lakhs in the previous year.
Members are aware that the business environment in India is volatile due to loan-stressed steel making Companies and many major Companies are reeling under the Insolvency and Bankruptcy Code, with potential major takeovers. This has impacted the fresh long term investment in the steel industry in India. However, your Company gained in the international market with the joint efforts of the parent Company, CMI SA, and has bagged some major orders globally - resulting in the highest order book in the history of your Company.
Industrial Infrastructure Development
India was the worldâs third largest steel producer in 2017. The growth in the Indian steel sector has been driven by domestic availability of raw materials such as iron ore and cost-effective labour. Consequently, the steel sector has been a major contributor to Indiaâs manufacturing output.
The Indian steel industry is very modern with state-of-the-art steel mills. It has always strived for continuous modernisation and upgradation of older plants and higher energy efficiency levels.
India is expected to become the second largest steel producer in the world by end of 2018, based on increased capacity addition in anticipation of upcoming demand. The new steel policy, which has been approved by the Union Cabinet in May 2017, is expected to boost Indiaâs steel production.
Members are aware that your plant at Taloja is now equipped with improved infrastructure and enhanced capacity to produce high quality equipment at competitive cost. A full-fledged fabrication capability, including the facility to assemble the components like furnaces, has been developed at Hedavali.
Material Changes and Commitments affecting the financial position of the Company
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this report.
3. DIVIDEND
Your Directors are pleased to recommend a final dividend of Rs. 2 per equity share of face value of Rs. 10 each i.e. 20% for the financial year 2017-18. Your Directors are also pleased to recommend a one-time âSpecial Dividendâ of â2 per equity share of face value of Rs. 10 each i.e. 20% to mark the completion of ten years of acquisition of the Company by Cockerill Maintenance and Ingenerie SA. Total dividend for the year will be Rs. 4 per equity share of face value of Rs. 10 each. The dividend (final and special), as recommended, if approved by the Members of the Company at the Annual General Meeting will be payable after July 27, 2018. The dividend will be paid in compliance with applicable rules and regulations.
The Company does not propose to transfer any amount to the General Reserve out of the amount available for appropriation.
Transfer of amounts to Investor Education and Protection Fund
During the year under review, pursuant to the provisions of Section 124 of the Companies Act, 2013 and the Companies (Declaration and Payment of Dividend) Rules, 2014, as amended from time to time, the Company has transferred unclaimed dividend amount of Rs. 2,39,910/-, being the outstanding amount of the final dividend for the year ended March 31, 2010 to the Investor Education and Protection Fund. No claim hereafter lies against the Company in respect of this dividend.
4. SHARE CAPITAL
The paid-up equity share capital of the Company as at March 31, 2018 was Rs. 493.78 lakhs. During the year under review, the Company has not issued any shares, with or without differential voting rights. It has neither issued employee stock options nor sweat equity shares. As at March 31, 2018, none of the Directors of the Company holds shares in the Company.
5. DEPOSITS
Your Company has not accepted any public deposits during the financial year under review.
6. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE 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.
7. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
The Board has constituted a Corporate Social Responsibility (âCSRâ) Committee headed by Ms. Roma Balwani. Mr. Yves Honhon and Mr. Raman Madhok, Managing Director are the other members of the Committee. The Company has adopted a CSR policy in compliance with the provisions of the Companies Act, 2013 and Rules made thereunder. The CSR policy, during the year under review, was amended to include the area of Health in the activities identified by the Company. The CSR policy of the Company is available on the Companyâs website - www.cmifpe.com.
Pursuant to the provisions of Section 135 of the Companies Act, 2013 and the Rules framed thereunder, the average net profits computed as per Section 198 of the Companies Act, 2013 for the three immediately preceding financial years was negative, hence the Company was not required to spend any amount towards CSR activities for the year ended March 31, 2018. However, the Company had spent Rs. 21.07 lakhs on CSR activities during the year under review.
During the year under review, the Company had approved to undertake various CSR Projects in the area of Education, Health and Environment to achieve its social objective. The Company has partnered with agencies of repute and has committed to incur expenditure for CSR initiatives in the coming years through structured programs and projects. These projects and programs are on-going and have a qualitative long term impact on the beneficiaries.
Your Company encourages its employees to participate in the CSR activities to drive a positive change in the society. During the year, the employees of the Company constituted a CSR
Working Committee and participated in various educational, health and environment related programs in local communities around its office and workshops. The CSR Working Committee meets at regular intervals and discusses the social needs of the communities and solutions required to address the same. The Company is taking some time to define and articulate internally generated CSR Projects still better. Until such time, the Company is seeking help from external agencies and incorporating key suggestions of the CSR Working Committee, the Company is satisfied with the progress made in the CSR efforts so far and is confident that the CSR Working Committee will deliver an accelerated level of progress in times to come.
A brief outline of the CSR policy and the initiatives taken by the Company during the year ended March 31 , 201 8 are furnished in Annexure A to this Report.
8. HUMAN RESOURCES
Personnel
Human Resource Capital and the value it creates form a big part of the Companyâs growth story. The industry today is changing rapidly with many disruptive business models necessitating a need for human capital to adapt in an agile manner.
Your Company takes pride in its continued focus on employee retention. Your Company believes that its workforce lives its brand.
The industrial relations continued to be cordial at all levels throughout the year. Your Directors wish to thank all the Employees and Workmen of the Company for their contribution, support and continued co-operation throughout the year.
Health and Safety
The details on Health and Safety are provided in the Management Discussion and Analysis which forms part of this Report.
Disclosure as required under Section 22 of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
Your Company as an organization is committed to provide a healthy environment to all the employees and thus does not tolerate any discrimination and / or harassment in any form. Your Company has in place a policy on prevention, prohibition and redressal of sexual harassment at workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules thereunder. All women -permanent, temporary or contractual are covered under the policy. The Policy has been widely communicated internally and is uploaded on the Companyâs intranet portal.
Frequent communication of this Policy is done through various programs and at regular intervals to the employees.
Your Company has set up an Internal Complaints Committee at the registered office and at every location where it operates in India in accordance with the said Act. Workshops and awareness programs are organized for sensitizing the employees with the provisions of the said Act.
During the year under review, the Internal Complaints Committee has not received any complaint of sexual harassment.
9. BUSINESS RISK MANAGEMENT
Your Company has a well-defined Risk Management framework in place, which functions at various levels. The Company has a robust organizational structure for managing and reporting on risks which is aligned with the COSO Enterprise Risk Management - Integrating with Strategy and Performance framework (released in September, 2017). In terms of the requirement of the Companies Act, 2013, the Company has developed and implemented the Risk Management Framework; the Risk Management Committee and the Audit Committee of the Board review the same periodically. Your Company has also established procedures to periodically place before the Audit Committee, the risk assessment and minimization procedures being followed by the Company and steps taken by it to mitigate the risks.
The details and the process of Risk Management as implemented by the Company are provided in the Management Discussion and Analysis which forms part of this Report.
10. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an adequate system of internal controls in place with reference to the Financial Statements. The management of the Company is responsible for ensuring that Internal Financial Controls (IFC) has been instituted in the Company and that such controls are adequate and operating effectively.
The Companyâs internal controls system is founded on values of integrity and operational excellence. It supports the vision of the Company. The foundation of the internal controls system lies in the corporate strategies, risk management framework and policies and procedures. The Company has a robust internal control framework, commensurate with the size, scale and complexity of its operations. The framework has been designed to provide reasonable assurance related to financial and operational information, compliance with applicable laws and for safeguarding the assets of the Company.
The Internal Audit function for the year 2017-18 was entrusted to PricewaterhouseCoopers Private Limited. To maintain objectivity and independence, the Internal Auditors reports to the Audit Committee.
During the year under review, the Risk Management Committee of the Company had reviewed the controls framework with detailed analysis of 10 key processes; no reportable material weakness in the âdesign of controlâ or âoperating effectivenessâ was observed. The Internal Audit team monitors and evaluates the efficacy and adequacy of internal control systems in the Company, on the basis of Standard Operating Procedures, instruction manuals, accounting policy and procedures at all locations of the Company. The results of the âcontrols testingâ were discussed with the Statutory Auditors. The Statutory Auditors have submitted their report on the Internal Financial Controls over Financial Reporting, which is annexed to the Independent Auditorsâ Report of the Company.
This formalized system of internal control and risk management framework facilitates effective compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âthe Listing Regulationsâ), Companies Act, 2013 and relevant statutes applicable to the Company.
11. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the Listing Regulations is implemented through the Companyâs Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.
The Whistle Blower Policy is available on the website of the Company - www.cmifpe.com. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.
12. DIRECTORS & KEY MANAGERIAL PERSONNEL
Changes in the composition of the Board of Directors
As informed in the last yearâs Annual Report, Mr. Jean Jouet resigned as the Chairman and Director of the Company; in his place, Mr. Joao Felix Da Silva has been appointed as the Chairman and Director of the Company with effect from May 30, 2017.
Apart from the above, there was no other change in the composition of the Board of Directors.
Retirement by rotation
In accordance with the provisions of Section 152 of the Companies Act, 201 3 and the Companyâs Articles of Association, Mr. Fabrice Orban retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. The Board recommends his reappointment for the consideration of the Members of the Company at the ensuing Annual General Meeting. Brief profile of Mr. Fabrice Orban has been given in the Notice convening the Annual General Meeting.
Independent Directors
The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and the Listing Regulations.
Performance Evaluation of the Board
Pursuant to the provisions of the Companies Act, 2013 read with the Rules issued thereunder and Regulation 17 of the Listing Regulations, the Board had carried out the annual performance evaluation of its own performance, an evaluation of the working of various Committees, as well as an evaluation of the directors individually.
The criteria for performance evaluation of the Board as a whole, individual Director, Committees of the Board and of the Chairman was in line with the Guidance Note on Board Evaluation issued by SEBI on January 5, 2017.
The evaluation exercise was carried out internally. Feedback was sought by way of a structured questionnaire covering various aspects of the Boardâs functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance for evaluation of the performance of Board, Committees of Board and individual Directors. The Board members were able to give qualitative feedback apart from the standard questionnaire.
The reports of feedback received from all Directors on performance evaluation of individual Directors were shared with respective Directors and Chairman of the Nomination and Remuneration Committee. The Committee evaluated the performance of all individual directors based on the feedback so received.
The report of the feedback received from all the Directors on performance evaluation of Board and Committees of Board were shared with the Chairman of the Company. The Board, on the basis of feedback so received, evaluated performance of its own and Committees of Board. The Performance Evaluation of the Chairman of the Company was carried out by the Independent Directors of the Company, taking into account the views of all the Directors including the Executive and Non-Executive Directors.
After the conclusion of the exercise, and after reviewing the findings, the Chairman of the Board met each Director individually to get individual feedback of the functioning of the Board and its constituents, inter alia, on the criteria such as attendance, level of participation at the meetings of the Board and Committees, independence of judgment exercised by the Independent Directors, interpersonal relationship, etc.
Significant collective insights, learning and action points with respect to the evaluation were presented to the Board. The Board of Directors expressed their satisfaction with the evaluation process and also with the findings.
Key Managerial Personnel
As at March 31, 2018, the following officers were designated as the Key Managerial Personnel (KMP) of the Company in accordance with Section 2(51) and Section 203 of the Companies Act, 2013, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 :
|
i) |
Mr. Raman Madhok |
Managing Director |
|
ii) |
Mr. Akash Ohri |
Chief Financial Officer |
|
iii) |
Mr. Haresh Vala |
Company Secretary |
There has been no change in the KMPs during the year under review.
Remuneration Policy
The Company has adopted a Remuneration Policy for the Directors, Key Managerial Personnel (âKMPâ) and other employees, pursuant to the provisions of Companies Act, 2013 and the Listing Regulations. The main objective of the said Policy is to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Directors, KMP and senior management employees. The remuneration involves a balance between fixed and incentive pay, reflecting short and long-term performance objectives appropriate to the working of the Company and its goals. The details of this policy are explained in the Corporate Governance Report.
13. DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of the provisions of Section 134(3)(c) of the Companies Act, 2013 that:
a. in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. such accounting policies as mentioned in the Notes to the financial statements have been selected and applied consistently, and judgments and estimates have been made that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;
c. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual financial statements have been prepared on a âgoing concernâ basis;
e. proper internal financial controls have been laid down and are being followed, and that such internal financial controls are adequate and are operating effectively; and
f. proper systems were in place to ensure compliance with the provision of all applicable laws, and these were adequate and operating effectively.
14. MEETINGS & COMMITTEES
Meetings held during the year
During the year under review, 4 (four) Board Meetings and 4 (four) Audit Committee Meetings were convened and held; the details of the meetings held and attendance of Directors at such meetings are provided in the Corporate Governance Report. The intervening gaps between the meetings were within the limits stipulated under the Companies Act, 2013 and the Listing Regulations. The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.
Committees of the Board
Your Company has duly constituted the Committees required under the Companies Act, 2013 read with applicable Rules made thereunder and the Listing Regulations. The Board of Directors has the following Committees :
i. Audit Committee
ii. Stakeholders Relationship Committee
iii. Nomination and Remuneration Committee
iv. Corporate Social Responsibility Committee
v. Risk Management Committee
The details of the composition of the Committees, their terms of reference and attendance at the meetings of the Committee of the Board are set out in the Corporate Governance Report.
15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year 2017-18, the Company has entered into transactions with related parties as defined under the Companies Act, 2013 and the Listing Regulations, all of which were in the ordinary course of business and on armâs length basis and in accordance with the provisions of the Companies Act, 2013, read with the Rules issued thereunder and the Listing Regulations. Thus a disclosure in Form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. All related party transactions are mentioned in the Notes to the financial statements.
None of the related party transactions entered into by the Company were in conflict with the Companyâs interests. There are no materially significant related party transactions made by the Company with the Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.
Memberâs approval for material Related Party Transactions, as defined under the Listing Regulations is being sought through suitable resolution at the ensuing Annual General Meeting.
All Related Party Transactions are placed before the Audit Committee / Board, as applicable, for their approval. Omnibus approvals are taken for the transactions which are repetitive in nature. A statement of all Related Party Transactions is placed before the Audit Committee for review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.
The Company has adopted a Related Party Transactions Policy. The Policy, as approved by the Board, is uploaded on the Companyâs website - www.cmifpe.com
None of the Directors has any pecuniary relationships or transactions with the Company except remuneration and sitting fees.
16. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There were no significant and material orders passed by the Regulators or Courts or Tribunals that would impact the going concern status of the Company and its future operations.
17. AUDITORS Statutory Auditors
M/s. Deloitte Haskins & Sells (DHS), Chartered Accountants, Mumbai were appointed as the Statutory Auditors of the Company at the 22nd Annual General Meeting (âAGMâ) of the Company held on September 19, 2008. In terms of the shareholderâs resolution passed at the 30th AGM of the Company held on July 29, 2016, M/s. Deloitte Haskins & Sells holds office until the conclusion of the ensuing 32nd AGM and have completed a term of ten years. Their term as the Statutory Auditors of the Company is upto the conclusion of the ensuing Annual General Meeting of the Company.
The Board places on record its appreciation for the services rendered by M/s. Deloitte Haskins & Sells, as the Statutory Auditors of the Company.
Pursuant to the provisions of Section 139 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, as amended from time to time, the Board of Directors of the Company, on the recommendation of the Audit Committee, proposed the appointment of M/s. S R B C & Co. LLP, Chartered Accountants, (ICAI Registration No. 324982E/E300003), as the Statutory Auditors of the Company, to be effective from the conclusion of the ensuing 32nd AGM for a term of five years, till the conclusion of the 37th AGM of the Company to be held in the year 2023. Necessary resolution seeking approval of the members for appointment of M/s. S R B C & Co. LLP as the Statutory Auditors of the Company has been incorporated in the Notice convening the Annual General Meeting, and forming part of this Annual Report. Pursuant to the Companies (Audit and Auditors) Amendment Rules, 2018 effective from May 7, 2018, the requirement of ratification of appointment of the Statutory Auditor at every Annual General Meeting by passing an ordinary resolution has been done away with.
M/s. S R B C & Co. LLP have consented to their appointment as Statutory Auditors and have confirmed that their appointment, if made, will be in accordance with Sections 139 and 141 of the Companies Act, 2013 and they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014, and that they are not disqualified for appointment.
The Members are requested to consider and approve the appointment of the Statutory Auditors as aforesaid and their remuneration.
The Auditorsâ Report on the Financial Statements for the financial year 2017-18 is unmodified i.e. it does not contain any qualification, reservation or adverse remark, and the Notes thereto are self-explanatory and do not require any explanations from the Board.
Cost Auditor
In terms of the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors of the Company, on the recommendation of the Audit Committee, has appointed M/s. Kishore Bhatia & Associates, Cost Accountants (Firm Registration Number 00294) as the Cost Auditor of the Company to conduct the audit of the cost accounting records maintained by the Company for the financial year 2018-19 on a remuneration of Rs. 2.30 lakhs.
As required under the Companies Act, 2013, a resolution seeking memberâs ratification for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors had appointed M/s. VKM & Associates, Practising Company Secretaries, to conduct the Secretarial Audit of the Company for the financial year 2017-18. The Secretarial Auditorâs Report is annexed as Annexure B and forms an integral part of this Report.
There is no qualification arising from the secretarial audit for the year under review.
Reporting of frauds by Auditors
During the year under review, the Statutory Auditors, Cost Auditor and the Secretarial Auditor have not reported to the Audit Committee under Section 143(12) of the Companies Act, 2013, any instance of fraud committed in the Company, by its officers or employees, details of which needs to be mentioned in this Report.
18. AWARDS & RECOGNITION
Your Company was conferred âIndiaâs Best Company of the Year Award - 201 7â by International Brand Consulting Corporation, USA in the industrial engineering equipment & services category.
19. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, pursuant to Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is annexed as Annexure C and forms an integral part of this Report.
20. CORPORATE GOVERNANCE
As per Regulation 34(3) read with Schedule V of the Listing Regulations, a Report on Corporate Governance together with a certificate from the Statutory Auditors of the Company confirming the compliance with the conditions of Corporate Governance is annexed and forms an integral part of this Report.
21. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, appended as stipulated under the Listing Regulations, form an integral part of this Report.
22. GREEN INITIATIVES
The Company started a sustainability initiative with the aim of going green and minimizing the adverse impact on the environment. Electronic copies of the Annual Reports are being sent to all the members whose email addresses are registered with the Company.
The Company has moved to âdigital document platformâ for Board and Committee meetings. This has helped the Company to reduce administrative time plus postage and papers for the preparation of the meetings. The Board members have adapted to the new software quickly, and the experience of adopting a nearly all-digital documentation process for Board and Committee meetings keeps getting better.
23. EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 201 3 read with Rule 1 2(1 ) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as at March 31, 2018 in Form MGT-9 is annexed as Annexure D and forms an integral part of this Report.
24. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosures with respect to the remuneration of Directors, KMP and employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended from time to time, is annexed as Annexure E and forms an integral part of this Report.
The information regarding employee remuneration as required pursuant to Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 201 4 is available for inspection. A statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules will be provided upon request. In terms of first proviso to Section 1 36 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employeesâ particulars, which is available for inspection by the Members at the Registered Office of the Company during the business hours on working days of the Company upto the date of the ensuing Annual General Meeting. Any member interested in obtaining a copy thereof may write to the Company Secretary.
None of the employees listed in the said Annexure is related to any Director of the Company. None of the employees hold (by himself or along with his / her spouse and dependent children) more than 2% of the equity shares of the Company.
25. INSURANCE
The Company has adequately insured itself through various insurance policies to transfer the risks arising from third party or customer claims, damage to property or people, etc.
Directorsâ & Officerâs Liability (D & O) policy covers the Directors and Officers of the Company against the risk of third party claims arising out of their actions / decisions in the normal course of discharge of their duties, which may result in financial loss to any third party.
The employees of the Company are covered under various employee benefit insurance schemes that provide cover for Hospitalization, Accidental Disability and Death.
26. PLANT VISIT
A visit was organized by the Company for the interested shareholders on Friday, September 22, 2017. The shareholders visited the Taloja plant, under the guidance and supervision of the Managing Director. The processes and functions at the Factory were explained by the Plant Head; the visit and the exposure and understanding of the Companyâs operations, were much appreciated by the shareholders.
During the âquestion and answerâ session with the Managing Director, the shareholders were able to understand more details about the current status of the Company. The shareholders who visited the factory were happy with the working and the improvements being made by the Company. They also appreciated the smooth planning and organization of the factory visit.
ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the co-operation and assistance received from the Government authorities, bankers, financial institutions, vendors, customers and shareholders, and also from all the employees and other stakeholders, during the year under review.
For and on behalf of the Board
Joao Felix Da Silva
Taloja Chairman
May 30, 2018 DIN : 07662251
Mar 31, 2017
Dear Shareholders,
The Directors have pleasure in presenting the Thirty First Annual Report of the Company on the business and operations of the Company, together with the audited financial statements for the financial year ended March 31, 2017.
1. FINANCIAL PERFORMANCE
(Rs,in lacs)
|
Particulars |
Financial Year |
Financial Year |
|
2016-2017 |
2015-2016 |
|
|
Total Revenue |
16,787.17 |
21,449.07 |
|
Profit before provision for doubtful trade receivables, depreciation and amortisation |
1,065.18 |
2,134.36 |
|
expense, finance costs and tax expense |
||
|
Less: |
||
|
Depreciation and amortisation expense |
524.85 |
579.19 |
|
Finance costs |
102.93 |
237.45 |
|
Provision for doubtful trade receivables |
- |
792.44 |
|
Profit / (Loss) before Exceptional Item and Tax |
437.40 |
525.28 |
|
Add : Exceptional Item |
- |
1,433.93 |
|
Less : Tax expense: |
||
|
Net current tax expense |
79.00 |
23.00 |
|
Deferred tax |
12.91 |
623.93 |
|
Profit / (Loss) for the year |
345.49 |
1,312.28 |
|
Balance brought forward from previous year |
4,053.96 |
2,741.68 |
|
Balance carried forward |
4,399.45 |
4,053.96 |
2. OVERVIEW OF COMPANYâS FINANCIAL PERFORMANCE
Operations
The year under review marked the deflation of commodity prices globally reducing the steel prices. The growth in the demand for Indian steel lagged much behind the expectations. The net revenue from operations of the Company dropped by almost 24% and the profitability of the Company also decreased. The combination of predatory prices and import has jeopardized the loans raised by the domestic steel industry for capacity expansion.
Industrial Infrastructure Development
Infrastructure sector is a key driver for the Indian economy. The sector is highly responsible for propelling India''s overall development and enjoys intense focus from Government for initiating policies that would ensure time-bound creation of good infrastructure in the country. India is witnessing significant interest from international investors in the infrastructure space. Steel industry and its associated mining and metallurgy sectors have seen a number of major investments and developments in the recent past.
India is expected to become the world''s second largest producer of crude steel in the next 10 years, moving up from the third position, as its capacity is projected to increase to about 300 MT by 2025. Hence scope for accelerated growth is offered by India''s comparatively low per capita steel consumption and the expected rise in consumption due to increased infrastructure construction and the thriving automobile railways and white goods sectors.
Your Company, anticipating the growth in opportunities, has realigned the infrastructure and machines at Taloja Plant to achieve higher productivity and maximum utilization and to produce quality equipment at competitive cost. A full-fledged versatile fabrication facility has been developed at Hedavali for low cost production.
Material Changes and Commitments affecting the financial position of the Company
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this report.
3. DIVIDEND
In order to conserve resources for the operating business, your Directors do not recommend any dividend for the financial year 2016-17.
During the year, the unclaimed dividend amount of Rs,1,30,854/- out of the final dividend for the year ended March 31, 2009 was transferred to the Investor Education and Protection Fund.
4. SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2017 was Rs,493.78 lacs. During the year under review, the Company has not issued any shares with or without differential voting rights. It has neither issued employee stock options nor sweat equity shares. As on March 31, 2017, none of the Directors of the Company holds shares of the Company.
5. REGISTRAR AND SHARE TRANSFER AGENT
As informed in the last year Annual Report, the Company had, pursuant to the order of Securities and Exchange Board of India (âSEBIâ), switched over the activities of Registrar and Share Transfer Agent from Sharepro Services (India) Private Limited (âShareproâ) to Bigshare Services Private Limited (âBigshareâ), registered with SEBI.
Bigshare has taken over all the data and records from Sharepro and the transition of records was smooth, without any inconvenience to the shareholders of the Company.
The Company has made all the necessary disclosures and communication to BSE Limited as per the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (ââListing Regulationsâ).
6. DEPOSITS
Your Company has not accepted any deposits from the public falling within the ambit of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.
7. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 and Schedule V of the Listing Regulations are given in the notes to the Financial Statements.
8. CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
Pursuant to the provisions of Section 135 of the Companies Act, 2013 and the Rules framed thereunder, the Company spent Rs,3.19 lacs towards CSR activities for the year ended March
31, 2017. The contents of the CSR policy and initiatives taken by the Company during the year ended March 31, 2017 as per the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 are furnished in Annexure A to this Report. The CSR policy of the Company is available on the Company''s website -www.cmifpe.com.
The Company considers the community as an important stakeholder and has been investing in its well being with a belief that people around should prosper at the same pace as the business does. The Company has meticulously taken up social development as a core responsibility.
9. HUMAN RESOURCES Personnel
The industrial relations continued to be cordial at all levels throughout the year. Your Directors wish to thank all the Employees and Workmen of the Company for their contribution, support and continued co-operation throughout the year.
Health and Safety
The details on Health and Safety are provided in the Management Discussion and Analysis which forms part of this Report.
Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace
The Company as an organization is committed to provide a healthy environment to all the employees and thus does not tolerate any discrimination and / or harassment in any form. The Company has in place a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 201 3 and Rules thereunder. All women - permanent, temporary or contractual are covered under the policy. This has been widely communicated internally and is uploaded on the Company''s intranet portal.
The Company has set up an Internal Complaints Committee to inquire into complaints of sexual harassment and recommend appropriate action.
During the year under review, the Internal Complaints Committee has not received any complaint of sexual harassment.
10. INNOVATION
The Company, alongwith its holding Company, has a track record of research and development, and has been recognized as a trendsetter with several breakthroughs in the industry. More recently, the Group has added many new products and techniques for special and customized applications. The spirit of innovativeness has helped the Company to achieve cost efficiencies in the areas of energy, raw materials sourcing, logistics, excellence in customer service and manpower optimization leading to productivity improvement.
11. BUSINESS RISK MANAGEMENT
The Board of Directors has constituted a Risk Management Committee. The Committee oversees the risk management process including risk identification, impact and control selfassessment, effective implementation of the mitigation plans and risk reporting. The objective of the Committee is to assist the Board in fulfilling its oversight responsibilities with regard to business risk management.
The details and the process of Risk Management as implemented by the Company are provided as part of the Management Discussion and Analysis which forms part of this Report.
12. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an adequate system of internal controls in place with reference to the Financial Statements. The management of the Company is responsible for ensuring that Internal Financial Controls (IFC) have been instituted in the Company and that such controls are adequate and operating effectively.
The Company''s internal controls system is founded on values of integrity and operational excellence. It supports the vision of the Company. The foundation of the internal controls system lies in the corporate strategies, risk management framework and policies and procedures. The Company has a robust internal control framework, commensurate with the size, scale and complexity of its operations. The framework has been designed to provide reasonable assurance related to financial and operational information, compliance with applicable laws and for safeguarding the assets of the Company.
The Internal Audit (IA) function for the year 201617 was entrusted to M/s. KPMG. To maintain objectivity and independence, the Internal Auditors report to the Audit Committee.
During the year under review, the Risk Management Committee of the Company had reviewed the test of controls with detailed analysis of 10 key processes; no reportable material weakness in the design or operations was observed. The Internal Audit team monitors and evaluates the efficacy and adequacy of internal control systems in the Company, on the basis of Standard Operating Procedures, instruction manuals, accounting policy and procedures, its compliance with operating system, accounting procedures and policies at all locations of the Company. The results of the tests of the controls were discussed with the Statutory Auditors. The Statutory Auditors have submitted their report on the Internal Financial Controls, which forms an integral part of this Report.
This formalized system of internal control and risk management framework facilitates effective compliance of the Listing Regulations, Companies Act, 2013 and relevant statue applicable to the Company.
13. VIGIL MECHANISM / WHISTLE BLOWER POLICY
Fraud and corruption-free work culture has been at the core of the Company. To meet this objective, the Company has adopted a Whistle Blower Policy to deal with any instances of fraud and mismanagement in the Company. The mechanism provides for adequate safeguards against victimization of Director(s) and Employee(s) who avail themselves of the mechanism. The Whistle Blower Policy is available on the website of the Company - www.cmifpe.com. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.
14. DIRECTORS & KEY MANAGERIAL PERSONNEL
Changes in the composition of the Board of Directors
Mr. Jean Jouet, consequent to his taking new responsibilities within the CMI Group, resigned as the Chairman and Director of the Company with effect from May 30, 2017.
The Board of Directors (âBoardâ) places on record its collective unanimous appreciation of the valuable services rendered and contribution made by Mr. Jean Jouet during his tenure as the Chairman of the Board.
The Board, on the recommendations of the Nomination and Remuneration Committee, has appointed Mr. Joao Felix Da Silva (DIN 07662251) as an Additional Director, and also as the Chairman of the Board of Directors of the Company with effect from May 30, 2017.
Pursuant to the provisions of Section 161 of the Companies Act, 2013, Mr. Joao Felix Da Silva holds office upto the date of the ensuing Annual General Meeting of the Company and is eligible for appointment as a Non Executive Director. The Company has received a notice from a member along with a cheque in favour of the Company under Section 160 of the Companies Act, 2013, signifying his intention to propose Mr. Joao Felix Da Silva as candidate for the office of Director of the Company at the ensuing Annual General Meeting.
The necessary resolution proposing the appointment of Mr. Joao Felix Da Silva as Director, is being placed before the members for their approval.
Retirement by rotation
In accordance with the provisions of Section 152 of the Companies Act, 2013, Mr. Yves Honhon (DIN 02268831) retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. The Board recommends his re-appointment for the consideration of the members of the Company at the ensuing Annual General Meeting.
Re-appointment of Managing Director
The re-appointment and remuneration of Mr. Raman Madhok as Managing Director was approved by the members of the Company at the last Annual General Meeting for a further period of 3 years effective from October 9, 2016, subject to the approval of the Central Government.
Subsequently, on September 12, 2016, the Ministry of Corporate Affairs amended the Schedule V of the Companies Act, 2013 wherein the requirements relating to remuneration to professional managerial personnel would not be applicable on compliance of certain conditions. The required compliance information was included in the special resolution and the explanatory statement for re-appointment of Managing Director. The Central Government, vide its letter dated October 20, 2016, has confirmed that the approval of Central Government was not required for the payment of remuneration to Mr. Raman Madhok, he being a professional managerial personnel.
Independent Directors
All Independent Directors have submitted the declaration of Independence as required under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of Listing Regulations.
Brief profile of the Directors proposed to be appointed / re-appointed and other information as stipulated under Listing Regulations and Secretarial Standard 2 are furnished in the Notice attached to this Report.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 read with the Rules issued there under and Regulation 17 of the Listing Regulations, the Board had carried out the annual performance evaluation of its own performance, an evaluation of the working of various Committees, as well as an evaluation of the directors individually. Further SEBI vide its guidance note dated January 5, 2017 has suggested certain process / practice that may be adopted by the companies for performance evaluation. The Company had taken into consideration these guidelines also.
The evaluation exercise was carried out internally, using the experience gathered from the external evaluation outsourced in earlier years. A structured questionnaire was prepared after taking into inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.
After the conclusion of such exercise, and after reviewing the findings, the Chairman of the Board met each Director individually to get an overview of the functioning of the Board and its constituents, inter alia, on the criteria such as attendance and level of participation at the meetings of the Board and Committees, independence of judgment exercised by the Independent Directors, interpersonal relationship, etc.
Significant collective highlights, learningâs and action points with respect to the evaluation were presented to the Board. The Board of Directors expressed their satisfaction with the evaluation process and also with the findings.
Key Managerial Personnel
Mr. Raman Madhok, Managing Director, Mr. Akash Ohri, Chief Financial Officer and Mr. Haresh Vala, Company Secretary are the Key Managerial Personnel of the Company.
Remuneration Policy
The Company has adopted a Remuneration Policy for the Directors, Key Managerial Personnel (âKMPâ) and other employees, pursuant to the provisions of Companies Act, 2013 and the Listing Regulations. The main objective of the said policy is to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate the Directors, KMP and senior management employees. The remuneration involves a balance between fixed and incentive pay, reflecting short and long term performance objectives appropriate to the working of the Company and its goals. The details of this policy are explained in the Corporate Governance Report.
15. DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of the provisions of Section 1 34(3)(c) of the Companies Act, 201 3 that:
a. in the preparation of the annual financial statements for the year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. such accounting policies as mentioned in the Notes to the financial statements have been selected and applied consistently, and judgments and estimates have been made that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit of the Company for the year ended on that date;
c. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual financial statements have been prepared on a âgoing concern'' basis;
e. proper internal financial controls have been laid down and are being followed, and that such internal financial controls are adequate and are operating effectively; and
f. proper systems were in place to ensure compliance with the provision of all applicable laws, and these were adequate and operating effectively.
16. MEETINGS & COMMITTEES Meetings held during the year
During the year under review, 4 (four) Board Meetings and 4 (four) Audit Committee Meetings were convened and held, the details of the meetings held and attendance of Directors at such meetings are provided in the Corporate Governance Report. The intervening gaps between the meetings were within the limits stipulated under the Companies Act, 2013 and the Listing Regulations.
Audit Committee
The Audit Committee is constituted in line with the regulatory requirements mandated by the Companies Act, 2013 and the Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of this Report.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee is constituted in line with the regulatory requirements mandated by the Companies Act, 2013 and the Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of this Report.
Corporate Social Responsibility (CSR) Committee
The CSR Committee is constituted in line with the regulatory requirements mandated by the Companies Act, 201 3. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of this Report.
17. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All related party transactions that were entered into during the financial year were on an arm''s length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 and the Rules made there under and the Listing Regulations. There were no materially significant Related Party Transactions made by the Company during the year that would have required members'' approval under the Listing Regulations. The members, at the last Annual General Meeting held on July 29, 2016, had approved an omnibus prior approval for material related party transactions with CMI SA, Holding Company for a value up to Rs,500 crores and with CMI Industry Automation Private Limited, Fellow Subsidiary for a value up to Rs,25 crores for orders to be transacted in a span of 2 to 3 years. The Company is pleased to inform that orders with CMI SA for the financial year ended March 31, 2017 were for Rs,112.47 crores.
All Related Party Transactions are placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are foreseen and are repetitive in nature. A statement of all related party transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.
The Company has adopted a Related Party Transactions Policy. The Policy, as approved by the Board, is uploaded on the Company''s website at http://cmifpe.com/ financialreport.aspxRs,Subcat=RPT Policy as per LODR&InvestorType=Policies.
Details of transactions with Related Parties are given in the Notes to the Financial Statements in accordance with the Accounting Standards. There were no transactions during the year which were required to be reported in Form AOC 2.
None of the Directors has any pecuniary relationships or transactions with the Company.
18. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators or Courts or Tribunals that would impact the going concern status of the Company and its future operations.
19. AUDITORS
Statutory Auditors
At the Annual General Meeting (âAGMâ) of the Company held last year, pursuant to the provisions of the Companies Act, 2013 and Rules made there under, M/s. Deloitte Haskins & Sells, Chartered Accountants were appointed as the Statutory Auditors of the Company from the conclusion of the 30th Annual General Meeting held on July
29, 2016 till the conclusion of the 32nd Annual General Meeting of the Company to be held in the year 2018, subject to the ratification of their appointment at the AGM to be held in 2017.
M/s. Deloitte Haskins & Sells have furnished a certificate of their eligibility and consent under Section 141 of the Companies Act, 2013. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
The members are requested to consider the ratification of the appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants as Auditors and authorize the Board to fix their remuneration.
There are no qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their report.
Cost Auditor
In terms of the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to audit its Cost Accounting records for the financial year 201 7-201 8. The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s. Kishore Bhatia & Associates, Cost Accountants to audit the cost accounts of the Company for the financial year 2017-18 on a remuneration of Rs,2,00,000/-. As required under the Companies Act, 2013, a resolution seeking member''s approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their ratification.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 201 3 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors had appointed M/s. VKM & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2016-17. The Secretarial Auditor''s Report is annexed as Annexure B and forms an integral part of this Report.
There is no secretarial audit qualification for the year under review.
20. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed as Annexure C and forms an integral part of this Report.
21. CORPORATE GOVERNANCE
The Company has complied fully with the corporate governance requirements under the Companies Act, 2013 and as stipulated under the Listing Regulations. A separate section on Corporate Governance practices followed by the Company, along with a certificate from the Statutory Auditors of the Company confirming the compliance, is annexed and forms an integral part of this Report.
22. MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, appended as stipulated under the Listing Regulations forms an integral part of this Report.
23. EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the extract of the Annual Return is annexed as Annexure D and forms an integral part of this Report.
24. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure E and forms an integral part of this Report.
The information required under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules will be provided upon request. In terms of first proviso to Section 1 36 of the Companies Act, 201 3, the Report and Accounts are being sent to the members and others entitled thereto, excluding the information on employees'' particulars, which is available for inspection by the members at the Registered Office of the Company during the business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any member interested in obtaining a copy thereof may write to the Company Secretary. None of the employees listed in the said Annexure is related to any Director of the Company. None of the employees hold (by himself or along with his / her spouse and dependent children) more than 2% of the equity shares of the Company.
25. PLANT VISIT
The management will make arrangements for visit of the interested shareholders to the Company''s plant at Taloja on Friday, September 22, 2017. The plant visit is a half day program, and for operational convenience and safety reasons, is limited to 100 shareholders. Such of those shareholders who are keen to visit the Company''s plant are requested to submit their intention by filling up the enclosed form, to the Registrar and Transfer Agents of the Company, at the 31st Annual General Meeting.
Eligible shareholders will be those whose names appear in the Register of Members as on the date of 31st Annual General Meeting. The Company will finalize by August 14, 2017, the list of shareholders identified to attend the plant. The identification will be on first come first serve basis.
The shareholders so identified will not be allowed to transfer their âvisit requests'' to others nor will any companions be allowed to join the plant visit. Shareholders are requested to note that clicking of photos / videos is strictly prohibited inside the premises of the plant.
Shareholders will be required to show their identity proof as and when requested, for visiting the plant.
ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the co-operation and assistance received from the Government authorities, bankers, financial institutions, vendors, customers and shareholders, and also from all the employees and other stakeholders, during the year under review.
For and on behalf of the Board
Joao Felix Da Silva
Chairman
Taloja
May 30, 2017
Mar 31, 2016
Directorsâ Report
Dear Shareholders,
The Directors have pleasure in presenting the Thirtieth Annual Report of the Company on the business and operations of the Company, together with the audited financial statements for the financial year ended March 31, 2016.
FINANCIAL PERFORMANCE
(Rs. in lacs)
|
Particulars |
Financial Year |
Financial Year |
|
|
2015-2016 |
2014-2015 |
|
Total Revenue |
21,449.07 |
24,092.78 |
|
Profit before provision for doubtful trade receivables, depreciation and amortization |
2,134.36 |
1,319.27 |
|
expense, finance costs and tax expense |
|
|
|
Less: |
|
|
|
Depreciation and amortization expense |
579.19 |
650.13 |
|
Finance costs |
237.45 |
429.57 |
|
Provision for doubtful trade receivables |
792.44 |
3.18 |
|
Profit / (Loss) before Exceptional Item and Tax |
525.28 |
236.39 |
|
Add : Exceptional Item |
1,433.93 |
556.48 |
|
Less : Tax expense: |
|
|
|
Net current tax expense |
23.00 |
150.00 |
|
Deferred tax |
623.93 |
(304.40) |
|
Profit / (Loss) for the year |
1,312.28 |
947.27 |
|
Balance brought forward from previous year |
2,741.68 |
1,794.41 |
|
Balance carried forward |
4,053.96 |
2,741.68 |
DIVIDEND
In order to conserve resources for the operating business, your Directors do not recommend any dividend for the financial year 2015-16.
During the year, the unclaimed dividend pertaining to the final dividend for the year ended March 31, 2008 was transferred to the Investor Education and Protection Fund.
OPERATIONS
The year under review marked the deflation of commodity prices globally reducing the steel prices. The growth in the demand for Indian steel lagged much behind the expectations. The net revenue from operations of the Company dropped by almost 6.4% because of the uncertain business environment. However, the profitability of the Company increased because of other income and measures taken by the Company to increase the efficiency. The combination of predatory prices and import has jeopardized the loans raised by the domestic steel industry for capacity expansion.
INDUSTRIAL INFRASTRUCTURE DEVELOPMENT
The government''s focus on âMake in India'' and infrastructure looks to take off and translate into sustained demand for steel in the next couple of years. India is likely to be among the few countries worldwide where steel demand will see an upswing. The Company through its experience and proven process in cold rolling and metal processing industry, continuous innovation, value engineering and cost effective solution, will stand above its competitors.
As informed earlier, the operations of the Company at Silvassa plant was discontinued and the plant at Taloja was realigned with new infrastructure and machines.
During the year under review, the Company had disposed off the related assets at Silvassa including the land and buildings on January 19, 2016.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this report.
SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2016 was '' 493.78 lacs. During the year under review, the Company has not issued any shares. The Company has not issued shares with differential voting rights. It has neither issued employee stock options nor sweat equity shares. As on March 31, 2016, none of the Directors of the Company holds shares of the Company.
NEW LISTING AGREEMENT
The Company has entered into new Listing Agreement with BSE Limited, in compliance with Regulation 109 of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.
CHANGE OF REGISTRAR AND SHARE TRANSFER AGENT
Securities and Exchange Board of India (âSEBIâ) vide its order No. WTM/RKA/MIRSD2/41/2016 dated March 22, 2016 had, inter alia, advised the Companies who were clients of Sharepro Services (India) Private Limited (âShareproâ) to conduct an audit of the records and systems of Sharepro with respect to dividends paid and transfer of securities to determine whether the dividends have been paid to actual / beneficiary holders and whether securities have been transferred as per the provisions of the law. The order also advised the Companies to switch over the activities of Registrar and Share Transfer Agent from Sharepro to another Registrar and Transfer Agent registered with SEBI.
In view of the above, the Company had assigned the task of audit to M/s. VKM & Associates, Practicing Company Secretary and they have issued a report mentioning that there are no areas of default or concern relating to your Company.
The Board, through a circular resolution dated April 15, 2016 had approved the appointment of M/s. Bigshare Services Private Limited (âBigshareâ) as the Registrar and Share Transfer Agent of the Company, in place of Sharepro, with effect from May 1, 2016. The Company has made necessary disclosures and communication to BSE Limited as per the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
DEPOSITS
Your Company has not accepted any deposits from the public falling within the ambit of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.
DIRECTORS
Retire by rotation
In accordance with the provisions of Section 152 of the Companies Act, 201 3, Mr. Fabrice Orban retires by rotation at the forthcoming Annual General Meeting and being eligible, offers himself for re-appointment. The Board recommends his re-appointment for the consideration of the members of the Company at the ensuing Annual General Meeting.
Re-appointment of Managing Director
The current term of Mr. Raman Madhok as the Managing Director of the Company expires on October 8, 2016. At the meeting held on May 19, 2016, the Board of Directors, acting on the recommendation of the Nomination and Remuneration Committee, have approved his re-appointment for a further period of 3 (three) years, terms of remuneration, etc., subject to the approval of the members of the Company and Central Government, if required. The necessary resolution for his re-appointment is being placed before the members for approval.
Independent Directorsâ Declaration
All Independent Directors have submitted the declaration of Independence as required under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1 )(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ).
During the year under review, there is no change in the Board of Directors of the Company.
Brief profile of the Directors proposed to be appointed / re-appointed and other information as stipulated under Listing Regulations and Secretarial Standard 2 are part of the Notice attached to this Report.
KEY MANAGERIAL PERSONNEL
During the year under review, the Board had appointed Mr. Haresh Vala as the Company Secretary of the Company, being Key Managerial Personnel of the Company. As on date, Mr. Raman Madhok, Managing Director, Mr. Akash Ohri, Chief Financial Officer and Mr. Haresh Vala, Company Secretary are the Key Managerial Personnel of the Company.
BOARD EVALUATION
In compliance with the provisions of the Companies Act, 2013 read with the Rules issued there under and Regulation 17 of the Listing Regulations, the Board, with the assistance of the reputed consulting firm, Aon Services India Private Limited (erstwhile Hewitt Associates (India) Private Limited), had carried out an annual performance evaluation of its own performance, of the directors individually as well as an evaluation of the working of the Committees. Significant highlights, learning and action points with respect to the evaluation were presented to the Board. The Board of Directors expressed their satisfaction with the evaluation process and with the findings. The Chairman discussed with each Director individually regarding the findings of the evaluation.
REMUNERATION POLICY
The Company has adopted a Remuneration Policy for the Directors, Key Managerial Personnel and other employees, pursuant to the provisions of Companies Act, 2013 and the Listing Regulations. The policy lays down criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance Report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS BY THE COMPANY
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 and Schedule V of the Listing Regulations are given in the notes to the Financial Statements.
MEETINGS
During the year under review, 4 (four) Board Meetings and 4 (four) Audit Committee Meetings were convened and held, the details of the meetings held and attendance of Directors at such meetings are provided in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 201 3 and the Listing Regulations.
DIRECTORSâ RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of the provisions of Section 134(3)(c) of the Companies Act, 2013 that :
a. in the preparation of the annual financial statements for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
b. such accounting policies as mentioned in the Notes to the financial statements have been selected and applied them consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date;
c. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 201 3 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the annual financial statements have been prepared on a âgoing concern'' basis;
e. proper internal financial controls have been laid down and are being followed and that such internal financial controls are adequate and are operating effectively; and
f. proper systems were in place to ensure compliance with the provisions of all applicable laws, and these were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were on an arm''s length basis, in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 and the Rules made there under and the Listing Regulations (erstwhile Listing Agreement entered into with the Stock Exchange). There were no materially significant Related Party Transactions made by the Company during the year that would have required members approval under the Listing Regulations.
All Related Party Transactions are placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for transactions which are foreseen and are repetitive in nature. A statement of all related party transactions is placed before the Audit Committee for its review on quarterly basis, specifying the nature, value and terms and conditions of the transactions.
The Company has adopted a Related Party Transactions Policy. The Policy, as approved by the Board, is uploaded on the Company''s website at http:// cmifpe.com/financial report. aspx? Subcat=RPT Policy as per LODR & Investor Type=Policies.
Details of transactions with Related Parties are given in the Notes to the Financial Statements in accordance with the Accounting Standards. There were no transactions during the year which would require to be reported in Form AOC 2.
None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.
AUDITORS
a. Statutory Auditors
The Company''s Auditors, M/s. Deloitte Haskins & Sells, Chartered Accountants hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment as per Section 139 of the Companies Act, 2013.
M/s. Deloitte Haskins & Sells have expressed their willingness to get appointed as the Statutory Auditors of the Company and have furnished a certificate of their eligibility and consent under Section 141 of the Companies Act, 2013. In terms of the Listing Regulations, the Auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India. The Board, based on the recommendation of the Audit Committee, has recommended their appointment as Auditors of the Company till the conclusion of the 32nd Annual General Meeting of the Company to be held in the year 2018, subject to ratification at every Annual General Meeting.
The members are requested to consider the reappointment of M/s. Deloitte Haskins & Sells, Chartered Accountants as Auditors from the conclusion of this Annual General Meeting till the conclusion of the 32nd Annual General Meeting in the year 2018 subject to ratification at every Annual General Meeting.
There are no qualifications, reservations or adverse remarks or disclaimers made by the Statutory Auditors in their report.
b. Cost Auditor
In terms of the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to audit its Cost Accounting records for the financial year 2016-17. The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s. Kishore Bhatia & Associates, Cost Accountants to audit the cost accounts of the Company for the financial year 2016-17 on a remuneration of '' 2 lacs. As required under the Companies Act, 2013, a resolution seeking member''s approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting for their ratification.
c. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors had appointed M/s. VKM & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the financial year 2015-16. The Secretarial Auditor Report is annexed as Annexure A and forms an integral part of this Report.
There is no secretarial audit qualification for the year under review.
CORPORATE GOVERNANCE
As required under Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a separate section on Corporate Governance practices followed by the Company, together with a certificate from the Statutory Auditors of the Company confirming the compliance forms an integral part of this Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, as stipulated under the Listing Regulations forms part of the Annual Report.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORKPLACE
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules there under. An Internal Complaints Committee has been constituted to inquire into complaints of sexual harassment and recommend appropriate action.
During the year under review, the Internal Complaints Committee has not received any complaint of sexual harassment.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo, stipulated under Section 1 34(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed as Annexure B and forms an integral part of this Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 201 4, the extract of the Annual Return is annexed as Annexure C and forms an integral part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has in place an adequate system of internal controls and risk-mitigation system, which are constantly assessed and strengthened with the new / revised standard operating procedures. These are commensurate with the size, scale and complexities of its operations. The Internal Audit (IA) function is entrusted to KPMG. To maintain objectivity and independence, the Internal Auditor reports to the Audit Committee.
During the year under review, the Risk Management Committee of the Company had reviewed the new requirement of Internal Control over Financial Reporting (âICOFRâ) and finalized the detailed analysis of 10 key processes, and these were presented for review by the Statutory Auditors. The control mechanism and the process of testing of controls were discussed with the Statutory Auditors. The Statutory Auditors have submitted their report on the Internal Financial Controls which forms an integral part of this Report.
The Internal Auditor evaluates the adequacy of the internal control system in the Company on the basis of Standard Operating Procedures, instruction manuals, accounting policy and procedures.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower Policy to deal with any instances of fraud and mismanagement in the Company. The mechanism provides for adequate safeguards against victimization of Director(s) and Employee(s) who avail themselves of the mechanism. The Whistle Blower Policy is available on the website of the Company - www.cmifpe.com. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.
AUDIT COMMITTEE
The Audit Committee is constituted in line with the regulatory requirements mandated by the Companies Act, 201 3 and the Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board''s Report.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee is constituted in line with the regulatory requirements mandated by the Companies Act, 2013 and the Listing Regulations. The details of the Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board''s Report.
CORPORATE SOCIAL RESPONSIBILITY
In accordance with the provisions of Section 135 of the Companies Act, 2013 and the Rules framed there under, the Board has constituted a Corporate Social Responsibility (âCSRâ) Committee and the Company has adopted a policy for CSR. The text of this Policy is available on the Company''s website - www.cmifpe.com. For the year under review, the provisions of Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 201 4 are not applicable to the Company. However, the Company had spent an amount of '' 1.10 lac on CSR activities by donating computer to the Raigad Zilla Parishad Prathamik School and internal repairs conducted at Anandham Ashram, an old age home.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The information required under Section 197(12) of the Companies Act, 201 3 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 201 4 is annexed as Annexure D and forms an integral part of this Report.
The information required under Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 201 4, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said Rules will be provided upon request. In terms of first proviso to Section 136 of the Companies Act, 201 3, the Report and Accounts are being sent to the members and other entitled thereto, excluding the information on employees'' particulars, which is available for inspection by the members at the Registered Office of the Company during the business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any member is interested in obtaining a copy thereof, such member may write to the Company Secretary.
None of the employees listed in the said Annexure is related to any Director of the Company. None of the employees hold (by himself or along with his / her spouse and dependent children) more than 2% of the equity shares of the Company.
BUSINESS RISK MANAGEMENT
The Board of Directors has constituted a Risk Management Committee. The Committee oversees the risk management process including risk identification, impact and control assessment, effective implementation of the mitigation plans and risk reporting. The purpose of the Committee is to assist the Board in fulfilling its oversight responsibilities with regard to business risk management.
The details and the process of Risk Management as implemented by the Company are provided as part of the Management Discussion and Analysis which forms part of this Report.
HEALTH AND SAFETY
The details on Health and Safety are provided in the Management Discussion and Analysis which forms part of this Report.
PERSONNEL
The industrial relations continued to be cordial at all levels throughout the year. Your Directors wish to thank all the Employees and Workmen of the Company for their contribution, support and continued co-operation throughout the year.
ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the co-operation and assistance received from the Government authorities, bankers, financial institutions, vendors, customers and shareholders during the year under review.
For and on behalf of the Board
Jean Jouet
Chairman
Mumbai May 19, 2016
Mar 31, 2015
Dear Shareholders,
Your Directors have pleasure in presenting the Twenty-ninth Annual
Report of the Company, together with the audited financial statements
for the financial year ended March 31, 2015.
1. FINANCIAL PERFORMANCE
( Rs. in lacs)
PARTICULARS Financial Year Financial Year
2014-2015 2013-2014
Total Revenue 24,092.78 45,836.39
Profit before provision for doubtful trade
receivables, depreciation and 1,319.27 855.79
amortisation expense, finance costs and
tax expense
Less:
Depreciation and amortisation expense 650.13 838.04
Finance costs 429.57 670.20
Provision for doubtful trade
receivables 3.18 1,950.94
Profit / (Loss) before Exceptional
Item and Tax 236.39 (2,603.39)
Add : Exceptional Item 556.48 -
Less: Tax expense:
Net current tax expense 150.00 4.09
Deferred tax (304.40) (376.26)
Profit/(Loss) for the year 947.27 (2,231.22)
Balance brought forward from previous year 1,794.41 4,025.63
Balance to be carried forward 2,741.68 1,794.41
DIVIDEND In order to conserve resources for the operating business,
your Directors do not recommend any dividend for the financial year
2014-2015.
During the year, the unclaimed dividend pertaining to the interim
dividend and final dividend for the year ended March 31,2007 was
transferred to the Investor Education and Protection Fund.
OPERATIONS
The year under review was the year of consolidation for the future
growth. The revenue of the Company dropped by almost 50% because of the
steel market situation. However, the profitability of the Company has
increased because of other income and measures taken to increase
efficiency. Due to volatile business environment, slower expansion of
economy and waiting for new government policies, the market has put on
hold new projects and expansion of projects resulting in lower order
entry for the year under review.
INDUSTRIAL INFRASTRUCTURE DEVELOPMENT
As we mark the year under review as that of consolidation for future
growth, some major steps had been taken to strategically align the
manufacturing workshops. The operations at Silvassa plant have been
suspended and your Company's Taloja plant has been realigned with the
new infrastructure and machines so that it truly becomes the "Centre of
Excellence for cold rolling mills". Your Company's new plant at
Hedavali, Khopoli, Maharashtra has been developed as state-of-the-art
fabrication facility for internal use as well as for outside jobs.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF
THE COMPANY
There have been no material changes and commitments affecting the
financial position of the Company which have occurred between the end
of the financial year of the Company to which the financial statements
relate and the date of this report.
SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2015
was Rs. 493.78 lacs. During the year under review, the Company has not
issued shares with differential voting rights nor granted stock options
nor sweat equity. As on March 31,2015, none of the Directors of the
Company hold shares of the Company.
DEPOSITS
Your Company has not accepted any deposits from the public falling
within the ambit of Section 73 and 74 of the Companies Act, 2013 read
together with the Companies (Acceptance of Deposits) Rules, 2014.
DIRECTORS
Mr. Jean-Marc Kohlgruber, consequent to his taking new responsibilities
within the CMI Group, resigned as the Chairman and Director of the
Company with effect from July 30, 2014.
The Board of Directors ("the Board") placed on record its collective
unanimous appreciation of the valuable services rendered and
contribution made by Mr. Jean- Marc Kohlgruber during his tenure as the
Chairman of the Board since CMI SA took over the Company in 2008. The
Board also appreciated the contribution made by Mr. Kohlgruber, towards
smooth integration after acquisition and the subsequent strategic
development plans for the Company including modernization and expansion
plan of Taloja workshop and setting up of greenfield facility at
Hedavali.
The Board, on the recommendations of the Nomination and Remuneration
Committee, appointed Mr. Jean Jouet as an Additional Director of the
Company with effect from July 31, 2014. Subsequently, the Board at its
meeting held on October 29, 2014 appointed Mr. Jean Jouet as the
Chairman of the Board of Directors of the Company.
The Board, on the recommendations of the Nomination and Remuneration
Committee, also appointed Ms. Roma Balwani as an Additional Director
and as an Independent Director of the Company for a term of five
consecutive years with effect from October 29, 2014, also complying
with the provisions of Companies Act, 2013 and the Listing Agreement
for the appointment of woman director on the Board of the Company.
Mr. Jean Jouet and Ms. Roma Balwani hold office up to the date of
forthcoming Annual General Meeting of the Company. The Company has
received separate notices from a member along with the cheques in
favour of the Company under Section 160 of the Companies Act, 2013,
signifying its intention to propose Mr. Jean Jouet and Ms. Roma
Balwani as candidates for the office of Director of the Company at the
forthcoming Annual General Meeting.
The necessary resolutions proposing appointment of Mr. Jean Jouet and
Ms. Roma Balwani as Directors, are being placed before the shareholders
for their approval.
Mr. R. N. Tandon, Independent Director expressed his desire to not be
appointed as an Independent Director and accordingly stepped down as a
Director at the 28th Annual General Meeting of the Company held on July
30, 2014. The Board places on record its appreciation for the valuable
contribution made by Mr. R. N. Tandon during his association with the
Company.
In accordance with the provisions of Companies Act, 2013, Mr. Yves
Honhon retires by rotation at the forthcoming Annual General Meeting
and being eligible, offers himself for re-appointment.
All Independent Directors have submitted the declaration of
Independence as required under Section 149(7) of the Companies Act,
2013 confirming that they meet the criteria of independence as laid
down under Section 149(6) of the Companies Act, 2013 and Clause 49 of
the Listing Agreement.
Brief resume of the Directors proposed to be appointed / re-appointed
and other information as stipulated under Clause 49 of the Listing
Agreement with the Stock Exchange are part of the Notice attached to
this Report.
KEY MANAGERIAL PERSONNEL
Mr. Sanjay Kumar Mutha, Company Secretary resigned from the services of
the Company with effect from March 16, 2015. The Board, on the
recommendation of the Nomination and Remuneration Committee, appointed
Mr. Haresh Vala as the Company Secretary and Compliance Officer with
effect from May 29, 2015.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 read with the
Rules issued thereunder and Clause 49 of the Listing Agreement, the
Board, in consultation with Aon Hewitt, had carried out an annual
performance evaluation of its own performance, the directors
individually as well as the evaluation of the working of its Audit
Committee and Nomination and Remuneration Committee. The Board of
Directors expressed their satisfaction with the evaluation process.
REMUNERATION POLICY
The Board, has, on the recommendation of the Nomination and Remuneration
Committee, framed and adopted a policy for selection and appointment of
Directors, Senior Management and their remuneration pursuant to the
provisions of the Companies Act, 2013 and Clause 49 of the Listing
Agreement. The Remuneration Policy is stated in the Corporate Governance
Report.
PARTICULARS OF LOANS, GUARNATEES OR INVESTMENTS UNDER SECTION 186
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.
MEETINGS
During the year under review, 5 (five) Board Meetings and 4 (four)
Audit Committee meetings were convened and held, the details of which
are given in the Corporate Governance Report. The intervening gap
between the meetings was within the period prescribed under the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the
information and explanations obtained by them, your Directors make the
following statements in terms of the provisions of Section 134(3)(c) of
the Companies Act, 2013 that :
a. in the preparation of the annual financial statements for the year
ended March 31, 2015, the applicable accounting standards have been
followed along with proper explanation relating to material departures,
if any;
b. such accounting policies as mentioned in the Notes to the financial
statements have been selected and applied consistently and judgments
and estimates have been made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at
March 31,2015 and of the Profit of the Company for the year ended on
that date;
c. proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
d. the annual financial statements have been prepared on a going
concern basis;
e. proper internal financial controls had been laid down and followed
and that such internal financial controls are adequate and were
operating effectively; and
f. proper systems to ensure compliance with the provisions of all
applicable laws were in place which were adequate and operating
effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the
financial year were on an arm's length basis and were in the ordinary
course of business and the provisions of the Companies Act, 2013, Rules
made thereunder and Clause 49 of the Listing Agreement are not
attracted. Thus the disclosure in Form AOC 2 is not required. During
the year, the Company had not entered into any contract / arrangement /
transaction with related parties which could be considered material in
accordance with the policy of the Company on materiality of related
party transactions. There are no materially significant related party
transactions made by the Company with Promoters, Directors, Key
Managerial Personnel or other designated persons which may have a
potential conflict with the interest of the Company at large.
All Related Party Transactions are placed before the Audit Committee and
also the Board for approval. Prior omnibus approval of the Audit
Committee is obtained on a quarterly basis for transactions which are of
foreseen and repetitive nature. The transactions entered into pursuant
to omnibus approval so granted are audited and a statement giving
details of all related party transactions is placed before the Audit
Committee and the Board of Directors for their approval on a quarterly
basis.
Details of transactions with Related Parties are given in the notes to
the Financial Statements.
The policy on Related Party Transactions as approved by the Board is
uploaded on the website of the Company.
None of the Directors has any pecuniary relationships or transactions
vis-a-vis the Company.
AUDITORS
a. Statutory Auditors
The Company Auditors, M/s. Deloitte Haskins & Sells, Chartered
Accountants, retire at the conclusion of the forthcoming Annual General
Meeting and are eligible for re-appointment.
Pursuant to the provisions of Section 139 of the Companies Act, 2013
('the Act') read with Rule 6 of the Companies (Audit and Auditors)
Rules, 2014, the Audit Committee and the Board have recommended their
re-appointment as Auditors of the Company from the conclusion of the
forthcoming Annual General Meeting till the conclusion of the next
Annual General Meeting of the Company at a remuneration of Rs. 34.50
lacs (plus reimbursement of out- of-pocket expenses).
The Company has received a written consent to such appointment from
M/s. Deloitte Haskins & Sells, Chartered Accountants, and a certificate
that the appointment, if made, shall be in accordance with the criteria
as specified in Section 141 of the Act. As required under Clause 49 of
the Listing Agreement, the Auditors have also confirmed that they hold
a valid certificate issued by the Peer Review Board of the Institute of
Chartered Accountants of India.
The necessary resolution is being placed before the shareholders for
approval.
There are no qualifications, reservations or adverse remarks or
disclaimers made by the Statutory Auditors in their report except the
Emphasis of Matter.
b. Cost Auditor
Pursuant to the provisions of Section 148 of the Companies Act, 2013
read with the Companies (Cost Records and Audit) Amendment Rules, 2014,
the Company is required to audit its Cost Accounting records for the
financial year 2015-2016. Your Directors had, on the recommendation of
the Audit Committee, appointed M/s. Kishore Bhatia & Associates, Cost
Accountants to audit the cost accounts of the Company for the financial
year 2015-2016 on a remuneration of Rs. 1.40 lacs. As required under the
Companies Act, 2013, the remuneration payable to the Cost Auditor is
required to be placed before the shareholders in a general meeting for
ratification. Accordingly, a resolution seeking shareholders
ratification for the remuneration payable to M/s. Kishore Bhatia &
Associates, Cost Auditor is included in the Notice convening the Annual
General Meeting.
The cost audit report would be filed with the Central Government within
prescribed timelines.
c. Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Board of Directors had appointed M/s. VKM & Associates,
Company Secretaries in Practice to undertake the Secretarial Audit of
the Company for the financial year 2014-2015. The Report of the
Secretarial Auditor is annexed herewith as Annexure A and forms an
integral part of this Report.
There are no qualifications, reservations or adverse remarks or
disclaimers made by the Secretarial Auditor in his Secretarial Audit
Report.
AWARDS & RECOGNITION
Your Company was conferred the status of "STAR EXPORT HOUSE" by the
Director General of Foreign Trade for a period of five years ending on
March 31,2019.
During the year under review, your Company received a Certificate of
Merit for the Improvement Project "CAD / CAM Integration : Linking
Design and Manufacturing" at the 26th QIMPRO Convention held at Mumbai
in October, 2014.
CORPORATE GOVERNANCE
A Report on Corporate Governance, along with a Certificate from the
Statutory Auditors of the Company regarding the compliance with the
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report, as stipulated under
Clause 49 of the Listing Agreement forms part of the Annual Report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your Company has in place a Policy on Prevention, Prohibition and
Redressal of Sexual Harassment at Workplace in line with the
requirements of The Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013. An Internal
Complaints Committee has been set up to redress complaints received
regarding sexual harassment. The policy has set guidelines on the
redressal and enquiry process that is to be followed by the
complainants and the Internal Complaints Committee, whilst dealing with
issues related to sexual harassment at the workplace towards any women
employees. All women employees (permanent, temporary, contractual and
trainees) are covered under this policy. All employees are treated with
dignity with a view to maintain an environment free of sexual
harassment whether physical, verbal or psychological.
During the year under review, the Internal Complaints Committee has not
received any complaint pertaining to sexual harassment.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information on the energy conservation, technology absorption and
foreign exchange earnings and outgo, as required under Section
134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies
(Accounts) Rules, 2014 is annexed herewith as Annexure B.
EXTRACT OF ANNUAL RETURN
The Extract of Annual Return as provided under Section 92(3) of the
Companies Act, 2013 and as prescribed in Form No. MGT-9 of the
Companies (Management and Administration) Rules, 2014 is annexed
herewith as Annexure C and forms an integral part of this Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an adequate Internal Control System, commensurate with
the size, scale and complexity of its operations. The scope of the
Internal Audit (IA) function outsourced to KPMG as of current is well
defined in the engagement letter of the Internal Auditor duly approved
by the Audit Committee. To maintain its objectivity and independence,
the Internal Auditor reports to the Audit Committee.
The Internal Auditor evaluates the adequacy of the internal control
system in the Company on the basis of Statement of Operations
Procedure, instruction manuals, accounting policy and procedures.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has a vigil mechanism named Whistle Blower Policy to deal
with any instances of fraud and mismanagement in the Company. The
details of the Whistle Blower Policy are explained in the Corporate
Governance Report and also posted on the website of the Company. It is
affirmed that no personnel of the Company has been denied access to the
Audit Committee.
AUDIT COMMITTEE
The Audit Committee is constituted in line with the regulatory
requirements mandated by the Companies Act, 2013 and Clause 49 of the
Listing Agreement. The details of the Committee and its terms of
reference are set out in the Corporate Governance Report forming part
of the Board's Report.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee is constituted in line with
the regulatory requirements mandated by the Companies Act, 2013 and
Clause 49 of the Listing Agreement. The details of the Committee and
its terms of reference are set out in the Corporate Governance Report
forming part of the Board's Report.
CORPORATE SOCIAL RESPONSIBILITY
The Board has constituted a Corporate Social Responsibility (CSR)
Committee in accordance with Section 135 of the Companies Act, 2013.
For the year under review, the provisions of Section 135 of the
Companies Act, 2013 read with the Companies (Corporate Social
Responsibility) Rules, 2014 are not applicable to the Company. However,
the Board has approved an amount of Rs. 5 lacs to be spent on CSR
activities for the financial year 2015-16.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators /
Courts which would impact the going concern status of the Company and
its future operations.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 of the Companies Act,
2013 ('the Act') read with Rule 5 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 in respect of
employees of the Company, will be provided upon request. In terms of
Section 136 of the Act, the Report and Accounts are being sent to the
Members and others entitled thereto, excluding the information on
employees' particulars which is available for inspection by the Members
at the Registered Office of the Company during business hours on
working days of the Company up to the date of the ensuing Annual
General Meeting. If any Member is interested in obtaining a copy
thereof, such Member may write to the Company Secretary in this regard.
None of the employees listed in the said Annexure is related to any
Director of the Company. None of the employees hold (by himself or
along with his / her spouse and dependent children) more than 2% of the
equity shares of the Company.
BUSINESS RISK MANAGEMENT
Pursuant to the requirement of Clause 49 of the Listing Agreement, the
Company has constituted a Risk Management Committee. The details of the
Committee and its terms of reference are set out in the Corporate
Governance Report forming part of the Board's Report.
The Board of Directors recognize that there are 3 (three) distinct
approaches followed in the various standards viz. the "Risk Management
Approach" followed by ISO 31000, the "Enterprise Risk Management
Framework (2004)" developed by COSO (Committee of Sponsoring
Organizations of the Treadway Commission) and the "Risk Aware culture"
developed by the Canadian Institute of Chartered Accountants known as
the CoCo (Criteria of Control) Framework.
After due reflection, it was felt appropriate to adopt the COSO ERM
Framework along with ISO 31000 framework for Risk Management at CMI
FPE.
The Company has robust Risk Management processes, aligned with the
aforesaid frameworks, to identify, evaluate and treat business risks.
The "Risk taxonomy" is aligned with that deployed at Group level. A 7
(seven) point rating scale is used for the dimensions of "likelihood",
"impact" and "control". To derive better insight on each Risk ID, risk
mapping is carried out based on 3 (three) perspectives, viz likelihood
v/s impact, impact v/s control and risk v/s control. The focus is more
on operational risk.
The Operations Committee is responsible for carrying out the risk
mapping exercise on a bi - annual basis. The results of the risk
mapping exercise are actively deliberated at the Audit Committee; going
forward, this will be initially done at the Risk Management Committee
and thereafter presented to the Audit Committee as well for further
deliberation.
The risk mitigation plan is integrated into the entity level annual
KPIs and progress monitored on a quarterly basis.
Care is taken to see that the Annual Internal Audit program is properly
correlated and aligned with the entity level risk mapping exercise.
The Board of Directors and Audit Committee engage with Management on a
periodic basis on matters such as the clarity in the rating scales as
defined, the interpretation of the risk maps based on the 3 (three)
perspectives elucidated above, the adequacy of the risk mitigation
actions, the degree to which "systemic risk" and "cyber risk" have been
identified, evaluated and mitigated and so forth.
The entity has recently contracted Disaster Recovery capability for its
state-of-the-art ERP Application with an internationally reputed data
centre. Measures are also in place to protect its critical Intellectual
Property.
HEALTH AND SAFETY
The Company continues to demonstrate a strong commitment towards safety
and occupational health of employees at all locations. Your Company has
a well established Safety Health & Environment (SHE) Policy. The
employees are encouraged to adopt a healthy, safe and environmentally
conscious lifestyle. The Company has taken various steps to strengthen
the Safety culture across the organization and imparting various
trainings at all employee levels. Some specific measures taken in recent
months to enhance the entity's safety orientation are detailed in the
subsequent paragraphs.
* The strategic focus for safety, health and environmental initiatives
has been communicated across the organization from the desk of the
Managing Director.
* The work permit procedure, format and declaration for non-routine
activities requiring special measures for risk identification and risk
mitigation has been recently revised to make it more comprehensive in
scope and approach, while focusing on contract workers hired for some
specific projects.
* Job safety analysis has been carried out in a more thorough manner
for critical machines at our workshop.
* Personal Protection Equipment (PPE hereinafter) matrix has been
revised (type of PPE, hazard, body part affected).
* The Entity's Safety Health & Environment (SHE) Policy has been
base-lined with the National Policy on SHE (2010), OHSAS 18001:2007.
The Company believes that "Detailed Root Cause Analysis and corrective
action for Near Misses", "safety training" with a practical orientation
and a "Safety MIS" are the cornerstones of a robust safety program.
Environmental Health and Safety training programs have been carried out
focusing on group level policies, procedures, safe work practices. The
monthly safety MIS has been aligned with that at CMI Group level. There
is a strict policy, mandated by the MD's Office, to deal with "safety
violations" and these are tracked through a "safety violations
tracker", maintained by the Company's Safety Manager.
The Company's 2 (two) Plants at Taloja and Hedavali have been without
any 'Lost Time Accident' for the year under review. We believe this is
an outcome of the Company's pro - active approach to safety of its
direct and indirect personnel.
The Company is already aligned with CMI Group procedural and reporting
practices relating to health and safety. Going forward, every effort
will be made to further refine existing safe work practices through
focus on the twin initiatives of "safety training" and "safety audit",
thereby creating an environment wherein good safety practices are
nurtured and encouraged.
PERSONNEL
The industrial relations continued to be cordial at all levels
throughout the year. Your Directors wish to thank all the Employees and
Workmen of the Company for their contribution, support and continued
co-operation throughout the year.
ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the
co-operation and assistance received from the Government authorities,
bankers, financial institutions, vendors, customers and shareholders
during the year under review.
For and on behalf of the Board
Jean Jouet
Chairman
Mumbai
May 29, 2015
Mar 31, 2014
Dear Shareholders,
The Directors have pleasure in presenting the Twenty-eight Annual
Report of the Company, together with the audited Accounts, for the
financial year ended March 31, 2014.
1. FINANCIAL PERFORMANCE
(Rs in lacs)
PARTICULARS Financial Year Financial Year
2013-2014 2012-2013
Total revenue 45,836.39 54,051.25
profit before provision for doubtful trade
receivables, depreciation and amoratisation 855.79 864.23
expense, finance costs and tax expense
Less:
Depreciation and amortisation expense 838.04 460.33
Finance costs 670.20 314.70
Provision for doubtful trade receivables 1,950.94 281.79
(Loss) before Tax (2,603.39) (192.59)
Less: Tax expense:
Net current tax expense 4.09 -
Deferred tax (376.26) (93.23)
(Loss) for the year (2,231.22) (99.36)
Balance brought forward from previous year 4,025.63 4,124.99
Balance to be carried forward 1,794.41 4,025.63
2. DIVIDEND
In view of the loss for the year under review, your Directors regret
their inability to recommend any dividend for the year under review.
3. OPERATIONS
The year under review was one of the challenging phase for the Company.
The financial results for the year under review and profitability were
adversely impacted mainly due to a provision of Rs. 1950.94 lacs made by
the Company against a receivable from a foreign customer, which had
TPTremained outstanding in the books of account for over three years
for several reasons. The financial results were also impacted due to
higher capital charges and depreciation associated with the
commissioning of new capacities, and also due to much lower margins on
projects under execution due to highly competitive environment.
Volatile business environment, political uncertainty, slower expansion
of the domestic economy are impacting the fresh long-term investments
and/or existing projects under execution, which resulted in marginal
growth in the order entries during the year under review.
4. INDUSTRIAL INFRASTRUCTURE DEVELOPMENT
Your Company''s Taloja plant "Centre of Excellence for Cold Rolling
Mills" is now equipped with improved infrastructure, machines,
productivity and enhanced capacity. Your Company partially developed
land and internal roads at its new facility at Hedavali, near Khopoli,
Maharashtra. In the first phase, a state-of-the-art fabrication facility
has been set up at this location.
5. DIRECTORS
Mr. Jean Gourp, consequent to his elevation to a new position within
CMI Group in Europe, resigned as Managing Director of the Company with
effect from April 15, 2013. He continued as an Executive Director of
the Company till April 30, 2013 and thereafter, as a Director on the
Board. He then also resigned as a Director w.e.f. February 05, 2014.
The Board of Directors (''the Board'') placed on record its appreciation
of the valuable services rendered and contribution made by Mr. Gourp
during his tenure, first as a Chief Operating officer, Deputy Managing
Director and then as Managing Director of the Company.
Mr. Sanjoy Kumar Das was appointed as the Managing Director of the
Company w.e.f. April 15, 2013. He resigned as the Managing Director of
the Company w.e.f. October 08, 2013.
Subsequently, the Board appointed Mr. Raman Madhok as an Additional
Director and also as the Managing Director of the Company w.e.f.
October 09, 2013.
The Board also appointed Mr. Fabrice Orban as an Additional Director of
the Company w.e.f. February 06, 2014.
Mr. Raman Madhok and Mr. Fabrice Orban hold office up to the date of the
forthcoming Annual General Meeting of the Company. The Company has
received separate notices from a member under Section 165 of the
Companies Act, 2013, signifying its intention to propose Mr. Raman
Madhok and Mr. Fabrice Orban as candidates for the office of Director of
the Company at the forthcoming Annual General Meeting.
The necessary resolutions proposing appointment of Mr. Fabrice Orban as
Director and appointment of Mr. Raman Madhok as Director and Managing
Director, are being placed before the Shareholders for approval.
Mr. Jean-Marc Kohlgruber retires by rotation at the forthcoming Annual
General Meeting and, being eligible, offers himself for re-appointment.
With the enactment of the Companies Act, 2013 (''the Act'') it is
mandatory for every listed company to appoint requisite number of
''Independent Directors'' as Defined in Section 149(6) of the Act. The
Company, in compliance with the Listing Agreement, has already
appointed Mr. D. J. Balaji Rao, Mr. Raman M. Madhok, Mr. R. N. Tandon
and Mr. N. Sundararajan, as Independent Directors in the Board. The
Board is of the opinion that the existing Independent Directors fulfl
the criteria as specified in Section 149 of the Act and the Rules made
thereunder.
Mr. R. N. Tandon (aged about 76 years) a Non-Executive (Independent)
Director of the Company, had joined the Board in April, 2001. Mr.
Tandon, owing to his commitment to the social activities expressed his
unwillingness to be re-appointed as an Independent Director of the
Company. However, he continues to be an Independent Director of the
Company up to the date of this AGM or any later date, as may be
decided.
The Board is also of the opinion that Mr. D. J. Balaji Rao, Mr. Raman
M. Madhok and Mr. N. Sundararajan are independent of the management of
the Company. Accordingly, the necessary resolutions proposing their
appointments as Independent Directors of the Company for a term of five
years upto March 31, 2019 are being placed before the Shareholders for
approval.
6. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confirm
that:
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed;
(ii) the Company has in the selection of the accounting policies,
consulted the Statutory Auditors and these have been applied
consistently and reasonable and prudent judgments and estimates have
been made so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2014 and of the loss of the Company for the
year ended on that date;
(iii) the Company has taken proper and suffcient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(iv) the annual accounts have been prepared on a "going concern" basis.
7. CORPORATE GOVERNANCE
A Report on Corporate Governance, along with a Certificate from the
Statutory Auditors of the Company regarding the compliance with the
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement, forms part of the Annual Report.
Your Company, during the current year, formulated a whistle-blower
policy. This policy aims to provide an avenue for directors and
employees to raise genuine concerns of any violations of legal or
regulatory requirements, actual or suspected fraud or violation of the
Company''s code of conduct and ethical business practices.
8. MANAGEMENT DISCUSSION AND ANALYSIS
A Management Discussion and Analysis Report forms part of the Annual
Report.
9. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to the energy conservation, technology
absorption and foreign exchange earnings and outgo, as required under
Section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of particulars in the Report of Board of Directors) Rules,
1988 are given as an Annexure to this Report.
10 PARTICULARS OF EMPLOYEES
As required under the provisions of sub-section (2A) of Section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended, particulars of the employees are set
out in an Annexure to this Report. However, as per the provisions of
Section 219(1)(b)(iv) of the Companies Act, 1956, the Directors'' Report
and Accounts are being sent to all the Shareholders of the Company
excluding the Statement of particulars of employees. Any Shareholder
interested in obtaining a copy of the Statement may write to the
Company Secretary of the Company.
11. AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the
conclusion of the forthcoming Annual General Meeting.
Pursuant to the provisions of Section 139 of the Act read with Rule 6
of the Companies (Audit and Auditors) Rules, 2014, the Audit Committee
and the Board have recommended their re-appointment as Auditors of the
Company from the conclusion the forthcoming Annual General Meeting till
the conclusion of the next Annual General Meeting of the Company at a
Remuneration of Rs. 34.50 lacs (plus reimbursement of out-of-pocket
expenses).
The Company has received a written consent to such appointment from
M/s. Deloitte Haskins & Sells, Chartered Accountants, and a certifcate
that the appointment, if made, shall be in accordance with the criteria
as specified in Section 141 of the Act.
The necessary resolution is being placed before the Shareholders for
approval.
12. COST AUDITOR
Pursuant to the Companies (Cost Audit Report) Rules, 2011, the Company
is required to audit its Cost Accounting records relating to
Engineering Machinery. M/s. Kishore Bhatia & Associates, Cost
Accountants has been appointed as the Cost Auditor of the Company for
the financial year 2013-14. The said appointment was subsequently
approved by the Central Government. The Cost Audit Report for the
financial year 2012-13 was fled on August 28, 2013 (due date for fling
was September 30, 2013) with the Ministry of Corporate Affairs.
Pursuant to Section 148 of the Act, the Board of Directors on the
recommendation of the Audit Committee, appointed M/s. Kishore Bhatia &
Associates, Cost Accountants, as the Cost Auditor of the Company for
the financial year 2014-15.
13. HEALTH AND SAFETY
The Company continues to demonstrate a strong commitment towards safety
and occupational health of employees at all locations. Your Company has
a well established Safety Health & Environment (SHE) Policy. The
employees are encouraged to adopt a healthy, safe and environmentally
conscious lifestyle. The Company has taken various steps to strengthen
the Safety culture across the organization and imparting various
trainings at all employee levels.
14. PERSONNEL
The industrial relations continued to be cordial at all levels
throughout the year. Your Directors wish to thank all the Employees and
Workmen of the Company for their contribution, support and continued
co-operation throughout the year.
15. ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the
co-operation and assistance received from the Government authorities,
bankers, financial institutions, vendors, customers and shareholders
during the year under review.
For and on behalf of the Board
Jean-Marc Kohlgruber
Chairman
Mumbai
May 27, 2014
Mar 31, 2013
Dear Shareholders,
The Directors have pleasure in presenting the Twenty-seventh Annual
Report of the Company, together with the audited Accounts, for the
financial year ended March 31, 2013.
1. FINANCIAL PERFORMANCE
(Rs. in Lacs)
PARTICULARS Financial Year Financial Year
2012-2013 2011-2012
Total revenue 54,051.25 35,762.02
Profit before Depreciation and
amortisation expenses, Finance Costs 582.44 2,253.88
and Tax
Less:
Depreciation and amortisation expense 460.33 438.72
Finance costs 314.70 179.97
Profit /(Loss) before Tax (192.59) 1,635.19
Less: Tax expense:
Net current tax expense - 577.87
Deferred tax (93.23) (38.80)
Profit/(Loss) for the year (99.36) 1,096.12
Balance brought forward from previous year 4,124.99 3,425.42
Profit available for Appropriation 4,025.63 4,521.54
Appropriation:
Ordinary Dividend - 246.89
Income Tax on Dividend - 40.05
Transferred to General Reserve - 109.61
Balance to be carried forward 4,025.63 4,124.99
2. DIVIDEND
In view of the nominal loss for the year under review, your Directors
regret their inability to recommend any dividend for the year under
review.
3. OPERATIONS
The year under review was very challenging for the Company. Your
Company has secured substantial growth in the Total revenue of the
Company by 51.14% to Rs. 54,051.25 Lacs in the year under review as
compared to Rs. 35,762.02 Lacs in the previous year. Simultaneously,
the Company has also successfully completed the major expansion and
modernization plan at its Taloja plant.
Despite this, mainly due to difficult economic conditions coupled with
fierce competition, high inflationary market conditions resulted in
higher input cost, severe pressure on margins, which resulted in
marginal operating loss for the year under review.
Members are aware that business environment continues to be volatile
due to global slowdown, uncertain environment and high fiscal deficit
and inflation. This is impacting the fresh long-term investments and/or
delaying execution of existing projects, which resulted in modest
growth in order entries during the year under review.
4. INDUSTRIAL INFRASTRUCTURE DEVELOPMENT
Your Company, in the last month of the year under review, successfully
completed the modernization and expansion plan of its Taloja plant,
thus making it the "Centre of Excellence for Cold Rolling Mills".
The Plant is now equipped with improved infrastructure, machines,
productivity and enhanced capacity.
Your Company progressively started development of land and internal
roads at its proposed Greenfield facility at Hedavali, near Khopoli,
Maharashtra. In the first phase, a state-of-the art fabrication
facility is being set up at this location.
5. DIRECTORS
Mr. Jean Gourp, consequent to his elevation to a new position within
CMI Group in Europe, resigned as Managing Director of the Company with
effect from the conclusion of the Board Meeting on April 15, 2013. He
continued as an Executive Director of the Company till April 30, 2013
and thereafter, he continues as a Director on the Board.
The Board of Directors (''the Board'') placed on record its
appreciation of the valuable services rendered and contribution made by
Mr. Gourp during his tenure, first as a Chief Operating Officer, Deputy
Managing Director and then as Managing Director of the Company.
Mr. Sanjoy Kumar Das was appointed as an Additional Director of the
Company w.e.f. April 15, 2013 by the Board. He was also appointed as
the Managing Director of the Company for a period of five years with
effect from the conclusion of the Board Meeting on April 15, 2013.
Mr. Das holds office up to the date of the forthcoming Annual General
Meeting of the Company. The Company has received a notice from a member
under section 257 of the Companies Act, 1956, signifying his intention
to propose Mr. Das as candidate for the office of Director of the
Company at the forthcoming Annual General Meeting.
The necessary resolution proposing his appointment and the remuneration
payable to him is being placed before the Shareholders for approval.
Mr. R. N. Tandon and Mr. Jean Gourp retire by rotation at the ensuing
Annual General Meeting and, being eligible, offer themselves for re-
appointment.
6. DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confirm
that:
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed;
(ii) the Company has in the selection of the accounting policies,
consulted the Statutory Auditors and these have been applied
consistently, and reasonable and prudent judgments and estimates have
been made so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2013 and of the loss of the Company for the
year ended on that date;
(iii) the Company has taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(iv) the annual accounts have been prepared on a "going concern"
basis.
7. CORPORATE GOVERNANCE
A Report on Corporate Governance, along with a Certificate from the
Statutory Auditors of the Company regarding the compliance with the
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement, forms part of the Annual Report.
8. MANAGEMENT DISCUSSION AND ANALYSIS
A detailed analysis of the Company''s performance is discussed in the
Management Discussion and Analysis Report, which forms part of the
Annual Report.
9. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to the energy conservation, technology
absorption and foreign exchange earnings and outgo, as required under
section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 are given as an Annexure to this Report.
10 PARTICULARS OF EMPLOYEES
As required under the provisions of sub-section (2A) of section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended, particulars of the employees are set
out in an Annexure to this Report. However, as per the provisions of
section 219(1 )(b)(iv) of the Companies Act, 1956, the Directors''
Report and Accounts are being sent to all the Shareholders of the
Company excluding the Statement of particulars of employees. Any
Shareholder interested in obtaining a copy of the Statement may write
to the Company Secretary of the Company.
11. AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the
conclusion of the forthcoming Annual General Meeting.
The Company has received a certificate from the above Auditors,
proposed to be re-appointed, to the effect that their re-appointment,
if made, would be in conformity with the limits specified under section
224(1B) of the Companies Act, 1956. The Audit Committee and the Board
have recommended their re-appointment. The necessary resolution is
being placed before the Shareholders for approval.
12. COST AUDITOR
Pursuant to the Companies (Cost Audit Report) Rules, 2011, the Company
is required to audit its Cost Accounting records relating to
Engineering Machinery starting from the financial year 2012-13.
M/s. Kishore Bhatia & Associates, Cost Accountants has been appointed
as the Cost Auditor of the Company for the financial year 2012-13. The
said appointment was subsequently approved by the Central Government.
The due date for filing of Cost Audit Report with the Ministry of
Corporate Affairs for the financial year 2012-13 is on or before
September 30, 2013.
Pursuant to section 233B of the Companies Act, 1956, the Board of
Directors on the recommendation of the Audit Committee, appointed M/s.
Kishore Bhatia & Associates, Cost Accountants, as the Cost Auditor of
the Company for the financial year 2013-14, subject to approval of the
Central Government.
13. HEALTH AND SAFETY
The Company continues to demonstrate a strong commitment towards safety
and occupational health of employees at all locations. Your Company has
a well established Safety Health & Environment (SHE) Policy.
The employees are encouraged to adopt a healthy, safe and
environmentally conscious lifestyle. The Company has taken various
steps to strengthen the Safety culture across the organization and
imparting various trainings at all employee levels.
14. PERSONNEL
The industrial relations continued to be cordial at all levels
throughout the year. Your Directors wish to thank all the Employees and
Workmen of the Company for their contribution, support and continued
co-operation throughout the year.
15. ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the
co-operation and assistance received from the Government authorities,
bankers, financial institutions, vendors, customers and shareholders
during the year under review.
For and on behalf of the Board
Jean-Marc Kohlgruber
Chairman
Mumbai
May 29, 2013
Mar 31, 2012
The Directors have pleasure in presenting the Twenty-Sixth Annual
Report of the company, together with the audited Accounts, for the
financial year ended March 31, 2012.
1. FINANCIAL PERFORMANCE
(Rs in Lacs)
FINANCIAL RESULTS Financial
Year Financial
Year
2011-2012 2010-2011
Total revenue 35,762.02 44,364.20
Profit before Depreciation and
amortisation expenses, Finance 2,253.88 7,947.06
Costs and Tax
Less:
Depreciation and amortisation expense 438.72 490.93
Finance costs 179.97 358.79
Profit before Tax 1,635.19 7,097.34
Less: Tax expense:
Current tax expense (Net) 577.87 1,760.83
Deferred tax (38.80) 618.65
Profit for the year 1,096.12 4,717.86
Balance brought forward from previous year 3,425.42 2,481.83
Profit available for Appropriation 4,521.54 7,199.69
Appropriation:
Proposed Dividend:
- Ordinary Dividend 246.89 493.78
- Special Silver Jubilee Dividend - 493.78
Income Tax on Dividend(s) 40.05 160.21
Transferred to General Reserve 109.61 2,626.50
Balance to be carried forward 4124.99 3,425.42
2. DIVIDEND
Your Directors are pleased to recommend a dividend of Rs 5 (i.e. 50%)
per equity share of the face value of Rs 10 each for the financial year
ended March 31, 2012, payable to those Shareholders whose names appear
in the Register of Members as on the Book Closure Date.
The total dividend outgo for the Year under review, inclusive of tax on
distributed profits would absorb a sum of Rs 286.94 Lacs (as against Rs
1,147.77 Lacs comprising the ordinary dividend of Rs 10 per equity
share, and the Special Silver Jubilee Dividend of Rs 10 per equity share
paid for the previous year).
3. OPERATIONS
The year under review was unusual in many ways. Members are aware of
the global slowdown, considering the world situation and that India has
been witnessing uncertain environment, high fiscal deficit, high
inflation and extreme currency volatility; India's growth in FY
2011-12, though lower compared to earlier years, has still been one of
the best performing in the world.
However, owing to current market conditions, exchange losses and
execution schedules of some of the ongoing projects being revised by
the customers, the financial results for the year under review were
adversely affected.
4. INDUSTRIAL INFRASTRUCTURE DEVELOPMENT
Your Company, in view of the prospective growth of the Steel Industry
mainly related to Flat Products in India and abroad and in order to
make Taloja as "Centre of Excellence for Cold Rolling Mills", has
implemented modernization and expansion plan at Taloja plant, leading
to improved infrastructure, machines, productivity and capacity of the
Taloja Plant.
Your Company has also acquired land for a "greenfield" facility at
Hedavali, near Khopoli, Maharashtra for its future expansion needs.
5. DIRECTORS
Mr. Yves Honhon and Mr. Raman M. Madhok retire by rotation at the
ensuing Annual General Meeting and, being eligible, offer themselves
for re-appointment.
Mr. Raman Madhok resigned as Managing Director and Director of the
Company with effective from the close of working hours on August 23,
2011. The Board wishes to place on record its appreciation of the
valuable services rendered and contribution made by
Mr. Raman Madhok during his tenure, first as an Advisor and then as
Managing Director of the Company.
Mr. Fabrice Orban was appointed as an Additional Director on the Board
of Directors of the Company on November 17, 2011. He resigned as an
Additional Director w.e.f. March 21, 2012, consequent to his taking up
a different assignment within the CMI Group in Europe.
6. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confirm
that:
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed;
(ii) the Company has in the selection of the accounting policies,
consulted the Statutory Auditors and these have been applied
consistently, and reasonable and prudent judgments and estimates have
been made so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2012 and of the profit of the Company for
the year ended on that date;
(iii) the Company has taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(iv) the annual accounts have been prepared on a "going concern"
basis.
7. CORPORATE GOVERNANCE
A Report on Corporate Governance, along with a Certificate from the
Statutory Auditors of the Company regarding the compliance with the
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement, forms part of the Annual Report.
8. MANAGEMENT DISCUSSION AND ANALYSIS
A detailed analysis of the Company's performance is discussed in the
Management Discussion and Analysis Report, which forms part of the
Annual Report.
9. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars relating to the energy conservation, technology
absorption and foreign exchange earnings and outgo, as required under
section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 are given in the Annexure to this Report.
10. PARTICULARS OF EMPLOYEES
As required under the provisions of sub-section (2A) of section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended, particulars of the employees are set
out in an Annexure to the Directors' Report. However, as per the
provisions of section 219(1 )(b)( iv) of the Companies Act, 1956, the
Directors' Report and Accounts are being sent to all the Shareholders
of the Company excluding the Statement of particulars of employees. Any
Shareholder interested in obtaining a copy of the Statement may write
to the Company Secretary of the Company.
11. AUDITORS
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the
conclusion of the forthcoming Annual General Meeting.
The Company has received a certificate from the above Auditors,
proposed to be re-appointed, to the effect that their reappointment, if
made, would be in conformity with the limits specified under the
provisions of section 224(1 B) of the Companies Act, 1956.
12. HEALTH AND SAFETY
The Company continues to demonstrate a strong commitment towards safety
and occupational health of employees at all locations. Your Company has
a well established Safety Health & Environment (SHE) Policy. The
employees are encouraged to adopt a healthy, safe and environmentally
conscious lifestyle. The Company has taken various steps to strengthen
the Safety culture across the organization and imparting various
trainings at all level of employees.
13. PERSONNEL
The industrial relations continued to be cordial at all levels
throughout the year. Your Directors wish to place on record their
appreciation of the dedicated services rendered by all Executives,
Staff and Workmen of the Company.
14. ACKNOWLEDGEMENT
Your Directors would like to express their appreciation for the
co-operation and assistance received from the Government authorities,
the financial institutions, banks, vendors, customers and shareholders
during the year under review.
For and on behalf of the Board
Jean-Marc Kohlgruber
Chairman
Mumbai
May 29, 2012
Mar 31, 2011
The Directors have pleasure in presenting the Twenty-Fifith Annual
Report together with the audited statements of Accounts for the
financial year ended March 31, 2011.
1. financial Performance
(Rs in lacs)
financial results financial Year financial Year
2010-2011 2009-2010
Sales and Other Income 44,363.08 40,299.64
Profit before Interest,
Depreciation & Tax 7,602.23 4,983.62
Interest 2.77 137.56
Profit before Depreciation & Tax 7,599.46 4,846.06
Depreciation 490.93 530.68
Profit before Tax 7,108.53 4,315.38
Provision for Tax - Current 1,873.00 1,720.00
- Deferred 618.65 (171.92)
- Wealth Tax 0.23 -
Tax relating to earlier year (net) (101.21) 38.66
Profit afiter Tax 4,717.86 2,728.64
Balance brought forward from
previous year 2,481.83 1,328.98
Profit available for Appropriation 7,199.69 4,057.62
appropriation:-
Proposed Dividend
-Ordinary Dividend 493.78 493.78
- Special Silver Jubilee Dividend 493.78 -
Income Tax on Dividends 160.21 82.01
Transferred to General Reserve 2,626.50 1,000.00
Balance carried forward 3,425.42 2,481.83
7,199.69 4,057.62
2. dividend
Your Directors are pleased to recommend a dividend of Rs10 per equity
share for the financial year ended March 31, 2011 and also a Special
Silver Jubilee Dividend of Rs 10 per equity share, as the Company
completes its twenty fve years of existence, aggregating Rs20 per
equity share of the face value of Rs10 each, payable to those
Shareholders whose names appear in the Register of Members as on the
Book Closure Date.
The total dividend outgo for the Year under review, inclusive of tax on
distributed profits would absorb a sum of Rs1,147.77 Lacs (as against
Rs575.79 Lacs comprising the dividend of Rs10 per equity share of
Rs10 each paid for the previous year).
3. oPerations
During the year under review, your Company achieved total Income of
Rs44,363.08 Lacs as compared to the total Income of Rs. `Rs.40,299.64
Lacs in the previous year registering a growth of 10.08%. The total
sales include export sales of Rs12,380.25 Lacs as compared to the
previous year of Rs 10,397.66 Lacs, registering a growth of 19.07%. The
profit afiter tax for the year is Rs4,717.86 Lacs as compared to Rs
2,728.64 Lacs for the previous year registering a growth of 72.90%.
4. fiXed dePosit
Your Company has not accepted any deposits from the public during the
year under review.
5. direCtors
Mr. Jean-Marc Kohlgruber and Mr. D. J. Balaji Rao retire by rotation at
the ensuing Annual General Meeting and, being eligible, offer
themselves for re-appointment.
Mr. N. Sundararajan was appointed as an Additional Director on the
Board of Directors of the Company on October 28, 2010 and holds offce
up to the date of the forthcoming Annual General Meeting of the
Company.
The Company has received a notice from a member under section 257 of
the Companies Act, 1956, signifying his intention to propose Mr. N.
Sundararajan as candidate for the offce of Director of the Company at
the forthcoming Annual General Meeting.
Mr. Raman Madhok has resigned as Managing Director and Director of the
Company, the resignation to be effective from the close of working
hours on August 23, 2011.
Mr. Jean Gourp, Deputy Managing Director of the Company has been
re-designated as Managing Director of the Company effective from August
24, 2011.
6. direCtors resPonsiBilitY stateMent
Pursuant to sub-section (2AA) of section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confrm
that:
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed;
(ii) the Company has in the selection of the accounting policies,
consulted the Statutory Auditors and these have been applied
consistently, and reasonable and prudent judgements and estimates have
been made so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2011 and of the profit of the Company for
the year ended on that date;
(iii) the Company has taken proper and suffcient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(iv) the annual accounts have been prepared on a going concern basis.
7. CorPorate GoVernanCe
A Report on Corporate Governance along with a Certifcate from the
Statutory Auditors of the Company regarding the compliance of
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
Directors explanation to Auditors Certifcate on Corporate Governance:
As regard the Auditors observations in para (i), (ii) and (iii) of
their Certifcate on Corporate Governance, the detailed responses/
explanations are given in items I, III and VII of the Corporate
Governance Report.
8. ManaGeMent disCUssion and analYsis
A detailed analysis of the Companys performance is discussed in the
Management Discussion and Analysis Report, which forms part of the
Annual Report.
9. enerGY ConserVation, teChnoloGY aBsorPtion and foreiGn eXChanGe
earninGs and oUtGo
The particulars relating to the energy conservation, technology
absorption and foreign exchange earnings and outgo, as required under
section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,
1988 are given in the Annexure to this Report.
10. PartiCUlars of eMPloYees
As required under the provisions of sub-section (2A) of section 217 of
the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 as amended, particulars of the employees are set
out in an Annexure to the Directors Report. However, as per the
provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the
Directors Report and Accounts are being sent to all the Shareholders
of the Company excluding the Statement of particulars of employees. Any
Shareholder interested in obtaining a copy of the Statement may write
to the Company Secretary of the Company.
11. aUditors
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the
conclusion of the forthcoming Annual General Meeting.
The Company has received a certifcate from the above Auditors, proposed
to be re-appointed, to the effect that their re- appointment, if made,
would be in conformity with the limits specifed under the provisions of
Section 224(1B) of the Companies Act, 1956.
12. health and safetY
The Company continues to demonstrate a strong commitment towards safety
and occupational health of employees at all locations. Your Company has
a well established Safety Health & Environment (SHE) Policy. The
employees are encouraged to adopt a healthy, safe and environmentally
conscious lifestyle.
13. Personnel
The industrial relations continued to be cordial at all levels
throughout the year. Your Directors wish to place on record their
appreciation of the dedicated services rendered by all Executives,
Staff and Workmen of the Company.
14. aCKnoWledGeMent
Your Directors would like to express their appreciation for the
co-operation and assistance received from the Government authorities,
the financial institutions, banks, vendors, customers and shareholders
during the year under review.
for and on behalf of the Board
Jean-Marc Kohlgruber
Chairman
Mumbai
May 24, 2011
Mar 31, 2010
The Directors have pleasure in presenting the Twenty Fourth Report on
the business and operations of the Company together with the Audited
Statements of Accounts for the Financial Year ended March 31, 2010.
1. FINANCIAL RESULTS
The following is the summary of fi nancial performance of the Company
during the year under review.
FINANCIAL RESULTS Current Year Previous Year
2009-2010 2008-2009
(Rs.in Lacs) (Rs.in Lacs)
Sales and Other Income 40,253.89 46,477.12
Profi t before Interest, Depreciation
& Tax 4,983.62 2,850.73
Interest 137.56 522.17
Profit before Depreciation & Tax 4,846.06 2,328.56
Depreciation 530.68 560.00
Profit before Tax 4,315.38 1,768.56
Provision for Tax - Current 1,720.00 1,700.00
- Deferred (171.92) (992.69)
Tax relating to earlier year (net) 38.66 753.95
Fringe Benefit Tax - 39.47
Profit after Tax 2,728.64 267.83
Balance brought forward from previous
year 1,328.98 1,196.78
Profit available for Appropriation 4,057.62 1,464.61
Appropriation:-
Proposed Dividend 493.78 98.76
Income Tax on Dividend 82.01 16.78
Transferred to General Reserve 1,000.00 20.09
Balance carried forward 2,481.83 1,328.98
4,057.62 1,464.61
2. DIVIDEND
Your Directors have recommended a dividend of Rs 10/- (Previous year
Rs. 2/-) per equity share of face value of Rs. 10/- for the fi nancial
year ended March 31, 2010, which on approval at the forthcoming Annual
General Meeting, will be paid
i) to those equity Shareholders, holding shares in physical form, whose
names appear on the Register of Members of the Company at the close of
business hours on July 31, 2010, after giving effect to all valid
transfers in physical form lodged with the Company or its Registrar and
Share Transfer Agent before July 24, 2010
ii) to those benefi cial owners, holding shares in electronic form,
whose names appear in the statement of benefi cial owners furnished by
Depositories to the Company as at the close of business hours on July
24, 2010
The total proposed dividend amount shall be Rs. 575.79 lacs including
dividend tax for the fi nancial year 2009-2010 (Previous year Rs.115.54
lacs).
3. TRANSFER TO RESERVES
The Company proposes to transfer Rs. 1,000.00 lacs (Previous year 20.09
lacs) to the General Reserve out of the amount available for
appropriations. An amount of Rs. 2,481.83 lacs (Previous year Rs.
1,328.98 lacs) has been proposed to be retained in the Profi t and Loss
Account.
4. OPERATIONS
During the year under review your Company achieved net turnover of Rs.
38,721.90 lacs against the preceding yearÃs level of Rs. 45,394.77
lacs. The Sales includes export sales of Rs.10,397.66 lacs against
previous yearÃs Rs. 33,241.03 lacs. Sharp decline in the export sales
pertains to global economic slowdown. However, Company successfully
targeted the domestic market, which was less affected by the downturn
in the economy. The profi t after tax for the year is Rs. 2,728.64 lacs
against Rs.267.83 lacs for the previous year.
5. FIXED DEPOSIT
Your Company has not accepted any deposits from the public during the
year under review.
6. DIRECTORS
Mr. K. R. Iyer and Dr. N. S. Datar retired as Directors w.e.f.
September 11, 2009.
The Board of Directors places on record its appreciation for their
contribution and guidance to the Board and to the Management.
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company, Mr. Ravindra Nath Tandon
retires by rotation at the ensuing Annual General Meeting, and being
eligible, offers himself for re-appointment. The particulars of
Director(s) who are seeking re-appointment at the ensuing Annual
General Meeting are furnished in the Corporate Governance Section
annexed to this report.
During the Board of Directors meeting held on May 20, 2010 Mr. Rob
Johnson, Managing Director tendered his resignation from the said post
w.e.f. July 15, 2010. Consequently Mr. Raman Madhok is appointed as
Managing Director w.e.f. July 16, 2010. Mr. Raman Madhok has been
associated with the Company as an Advisor to the Board since last two
years. Further Mr. Jean Gourp, Chief Operating Offi cer of the Company
has been elevated to the position of Deputy Managing Director w.e.f.
May 20, 2010.
The Board also places on record its appreciation for the tremendous
contribution and efforts of Mr. Rob Johnson in serving the Company in
his span of two years. During his tenure he successfully accomplished
various task the most important being the post acquisition integration
of the Company within the CMI fold.
7. DIRECTORSÃ RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confi rm
that:
a) in the preparation of the Annual Accounts for the year under review,
the applicable accounting standards have been followed;
b) the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company at the end of the fi nancial year 2009-2010 and of the
profi t of the Company for that period;
c) the Directors had taken proper and suffi cient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
d) the Directors had prepared the annual accounts for the year ended on
March 31, 2010 on a going concern basis.
8. INSURANCE
The Insurable interest in all the properties of the Company including
building, plant and machinery, stocks have been adequately insured.
9. DISCLOSURES
The information with regards to conservation of energy, technology
absorption and foreign exchange earnings and outgo pursuant to the
CompanyÃs (Disclosures of particulars in the report of the Board of
Directors) Rules, 1988 are given in Annexure ÃÃAÃÃ forming part of this
report.
10. PARTICULARS OF EMPLOYEES
The information as required u/s. 217(2A) of the Companies Act, 1956
read with Companies (Particulars of Employees) Rule of 1975, as amended
from time to time, forms part of this Report. However, as per the
provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the
Report and Accounts are being sent to all shareholders of the Company
excluding the information relating to the statement of particulars of
employees. Any shareholder interested in obtaining such particulars may
inspect the same at the Registered Offi ce of the Company or write to
the Company Secretary for a copy.
11. CORPORATE GOVERNANCE
Pursuant to clause 49 of the Listing Agreement with Stock Exchange, a
report on Corporate Governance along with a certifi cate from the
auditors are given in Annexure ÃBÃ forming part of this report.
12. MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to clause 49 of the Listing Agreement with Stock Exchange, a
section on management discussion and analysis is given in Annexure ÃCÃ
forming part of this report.
13. AUDITORS
Deloitte Haskins & Sells., Chartered Accountants, retire at the
conclusion of the forthcoming Annual General Meeting. Deloitte Haskins
& Sells., being eligible, have offered themselves for re-appointment
and have confi rmed that their appointment, if made, would be within
the limit prescribed under Section 224 (1B) of the Companies Act, 1956.
14. HEALTH AND SAFETY
The Company continues to accord high priority to health and safety of
employees at all locations. The Company has adopted Safety Health &
Environment (SHE) Policy. The employees are encouraged to adopt a
healthy, safe and environmentally conscious working style.
15. PERSONNEL
The industrial relations continued to be cordial at all levels. Your
Directors wish to place on record their appreciation of the dedicated
services rendered by all Executives, Staff and Workmen of the Company.
16. ACKNOWLEDGEMENT
Your Directors record their sincere gratitude to the Central
Government, Government of Maharashtra and Financial Institutions. The
Company expresses its thanks to the Bankers for their support and
co-ordination in the form of excellent services rendered by them and
Shareholders, Business Associates, Customers for their continued
support and faith in the Company.
By Order of the Board of Directors
Rob Johnson
Managing Director
Registered Office:
"Mehta House", Plot No. 64,
Road No. 13, MIDC,
Andheri (E),
Mumbai 400 093.
Place : Mumbai
Date : May 20, 2010
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