Mar 31, 2023
The Directors are pleased to present the Sixtieth Annual Report together with the audited financial statement for the year ended March 31,2023.
FINANCIAL HIGHLIGHTS (STANDALONE) |
'' in Crores |
|
2022 - 2023 |
2021 - 2022 |
|
Revenue from Operations |
4,919.43 |
4,172.57 |
Other Income |
29.98 |
25.61 |
Total Revenue |
4,949.41 |
4,198.18 |
Total Expenditure |
4,151.83 |
3,446.00 |
Gross Profit before interest, depreciation and taxes |
797.58 |
752.18 |
Less: Interest |
18.67 |
6.22 |
Exchange Losses / (Gains) |
5.96 |
7.17 |
Depreciation |
157.02 |
152.83 |
Provision for impairment of investments in subsidiaries |
- |
30.00 |
Profit before Tax |
615.93 |
555.96 |
Less: Provision for tax |
151.53 |
148.50 |
Profit after Tax |
464.40 |
407.46 |
Add: Balance brought forward |
207.59 |
155.70 |
Balance available for appropriation |
671.99 |
563.16 |
Appropriations |
||
Interim / Final Dividends |
117.12 |
206.98 |
Transfer to Reserves |
175.00 |
150.00 |
Transfer from other comprehensive income to reserves |
0.06 |
(1.41) |
Balance carried forward |
379.81 |
207.59 |
671.99 |
563.16 |
The Company has transferred '' 175.00 Crores to Reserves. DIVIDEND
The Board had earlier during the year, declared an interim dividend of '' 3.57/- per share (357%) for the financial year 2022-2023 and a special dividend of '' 2.00 per share (200%) to commemorate the 60th year of incorporation of the Company absorbing a sum of '' 117.12 Crores and the same was paid to the shareholders on November 30, 2022. The Directors have decided to pay a second interim dividend of '' 3.06 per share (306%), which, together with the first interim dividend and a special dividend, declared and paid earlier,
would amount to a total dividend of '' 8.63 per share (863%) for the financial year 2022-2023. No final dividend has been recommended by the Board of Directors.
The Dividend Distribution Policy, formulated in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is available on the Companyâs website at :- http://sundram.com/pdf/ corporate/DividendDistributionPolicy02022017.pdf
CONSOLIDATED FINANCIAL STATEMENT
In addition to the financial statement, the audited Consolidated Financial Statement of the Company and all of the subsidiaries prepared in the same form and manner as that
of its own and in accordance with the applicable Accounting Standards (Ind AS), form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited financial statement in respect of each of its subsidiary on its website, www.sundram.com. The Company shall provide a copy of audited financial statement, as the case may be, as prepared in respect of each of its subsidiary, upon request by any of its shareholders.
A separate report on Corporate Governance together with a certificate from the Companyâs auditors confirming the compliance of conditions of Corporate Governance is enclosed to this report. Management Discussion and Analysis detailing the state of the Companyâs affairs is also enclosed to this report (Please refer Page Nos. 36 to 41).
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report for the year ended March 31,2023 is enclosed to this report (Please refer Page Nos. 42 to 72).
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The existing composition of the Companyâs Board is fully in conformity with the applicable provisions of the Companies Act, 2013 and Regulations 17 and 17A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with regard to independent directors, women directors and maximum number of directorships in listed entities.
Ms. Arundathi Krishna, Joint Managing Director (DIN: 00270935) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The Board recommends her re-appointment as a Director of the Company. A brief resume of Ms. Arundathi Krishna and other relevant information have been furnished in the notice convening the AGM.
Sri Heramb R Hajarnavis, Director (DIN: 01680435) has been re-appointed as a Non-Executive Independent Director for the second term, from September 20, 2022 to September 19, 2027.
Sri S Mahalingam, Director (DIN: 00121727) has been re-appointed as a Non-Executive Independent Director for the second term, from January 30, 2023 to January 29, 2028.
Sri S Meenakshisundaram (DIN: 00513901) whose appointment as the Whole-Time Director was approved by the shareholders at the Annual General Meeting
held on June 11, 2020, had retired from the office of Whole-Time Director with effect from the closing hours of April 22, 2022. He continued as the Chief Financial Officer of the Company upto the closing hours of June 30, 2022 to ensure smooth transition and retired from the services of the Company effective July 1,2022. The Company has benefited immensely through his association and the Board of Directors place on record their sincere thanks for the services rendered by him as a Whole-Time Director and Chief Financial Officer.
Sri R Dilip Kumar, who held the position in the Company as Executive Vice President-Finance & Company Secretary was appointed as the Chief Financial Officer of the Company effective July 1,2022.
Sri G Anand Babu was appointed as the Company Secretary and the Compliance Officer of the Company effective July 1,2022.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
In terms of the requirement of Section 92(3) read with Section 134(3) of the Companies Act, 2013, the annual return of the Company as on March 31,2022 and the draft annual return of the Company as on March 31,2023 is available on the Companyâs website, www.sundram.com.
During the year, four meetings of the Board of Directors were held. The details of the meetings and the attendance are furnished in the Annual Report disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which is enclosed to this Report (Please refer Page No 75).
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and made judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended March 31,2023.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
DETAILS IN RESPECT OF FRAUD, IF ANY, REPORTED BY THE AUDITORS
M/s. B S R & Co. LLP, Chartered Accountants, Chennai, the Statutory Auditors of the Company have stated that during the course of their audit, there were no fraud by the Company or on the Company by its officers or employees noticed or reported in the Independent Auditorsâ Report which forms part of this Report. Hence, there was no requirement to report the same to the Audit Committee or Board of Directors of the Company.
NOMINATION AND REMUNERATION POLICY
Salient features of the Policy:
The policy is to ensure that the remuneration is in line with best comparable market practices, as well as competitive visa-vis that of comparable companies both in India and other international markets, which will have a motivating effect to act as a driving force to ensure long term availability of talent and also retention of the best talents. The Policy will have due regard to the situation of the specific regions in which the Company operates.
A brief description about the Companyâs Nomination and Remuneration Policy on directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other related matters provided in Section 178(3) of the Companies Act, 2013 are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Please refer Page No.77).
The Nomination and Remuneration Policy is available on the Companyâs website at: - https://sundram.com/pdf/corporate/ NominationandRemunerationPolicy.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for
which the loan or guarantee or security is proposed to be utilised by the recipient is enclosed vide Annexure - I.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on armâs length basis and in the ordinary course of business. There was no material related party contract during the year. Form AOC-2 as required under Section 134 (3)(h) of the Companies Act, 2013 is enclosed vide Annexure - II to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 is enclosed vide Annexure - III.
Brief description of terms of reference:-
i. To review and approve the risk management policy of the Company and to make amendments thereto from time to time.
ii. To monitor and oversee implementation of the risk management policy, including evaluating the adequacy of risk management systems.
iii. To periodically review the risk management policy, by considering the changing industry dynamics and evolving complexity
iv. To identify methodology, processes and systems to monitor and evaluate risk.
v. To identify internal and external risks in particular including financial, operational, sectoral, department-wise risk, business sustainability particularly, Environmental, Social and Governance (ESG) related risks, information and cyber security risks. Cyber security risks cover ransomware, phishing, data leakage, hacking, insider threat etc.
The Company manages its risks through continuous review of business parameters on a regular basis by the management. Insurable risks are analysed and insurance
policies are taken to protect the Companyâs interests. The Audit Committee is also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
During the year, two meetings of the Risk Management Committee were held. The details of the meetings are furnished in the Report on Corporate Governance disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this Report (Please refer Page No 79).
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The salient features of the Policy are to:
i. actively engage and extend support to the communities in which it operates and thus build a better, sustainable way of life by supporting the weaker sections of the society and thus contribute to the human development;
ii. drive measures and to provide solutions that will balance economic, social and environmental issues; and
iii. work together with our employees with a commitment for adhering to responsible business practices in terms of quality management, environmental sustainability and support to the community.
The Company has undertaken activities as per the CSR Policy and the Annual report on CSR activities for the Financial Year 2022-2023 is enclosed vide Annexure - IV forming part of this report.
The CSR Policy, including the annual action plan is available on the Companyâs website at www.sundram.com/investors.php.
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Annual Report disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this report.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
The Company has 6 Domestic Subsidiaries and 5 Overseas Subsidiaries. The financial performance of the subsidiaries during the financial year 2022-2023 is summarised hereunder:-
Sundram Fasteners (Zhejiang) Limited, China (SFZL, China), Cramlington Precision Forge Limited, United Kingdom
(CPFL, UK) and TVS Next Inc., USA are step-down overseas subsidiaries of the Company. The principal activity of SFZL, China is manufacture of fasteners and bearing housing and that of CPFL, UK is manufacture of precision forgings.
The total revenue of SFZL, China during the year under review was at '' 335.75 Crores as against '' 369.10 Crores in the previous year. The net profit was at '' 4.30 Crores as against '' 9.63 Crores in the previous year.
The total revenue of CPFL, UK during the year under review was at '' 176.55 Crores as against '' 156.18 Crores in the previous year. The net profit was at '' 3.69 Crores as against a net loss at '' (9.25) Crores in the previous year.
The total revenue of TVS Next Inc., USA, a step-down overseas subsidiary during the year under review was at '' 64.18 Crores as against '' 15.93 Crores in the previous year. The net profit was at '' 1.35 Crores as against '' 0.33 Crores in the previous year.
TVS Upasana Limited is a wholly-owned subsidiary and is engaged in the manufacture of spokes and nipples, automobile kits, tools, dowel pins, small screws, cold extruded parts and other parts catering to automotive industry. The total revenue of TVS Upasana Limited during the year under review was at '' 181.39 Crores as against '' 165.67 Crores in the previous year. The net profit was at '' 12.05 Crores as against '' 5.75 Crores in the previousyear.
The total revenue of Sundram Non-Conventional Energy Systems Limited, a subsidiary during the year under review was at '' 3.94 Crores as against '' 3.20 Crores in the previous year. The net profit was at '' 3.59 Crores as against '' 2.00 Crores in the previous year.
The total revenue of Sundram Fasteners Investments Limited, a wholly-owned subsidiary during the year under review was at '' 0.24 Crores as against '' 0.36 Crores in the previous year. The net profit was at '' 0.27 Crores as against '' 0.30 Crores in the previous year.
TVS Next Limited (TVSN), a subsidiary engaged in the information technology business providing Enterprise Solutions for core industries like Manufacturing, Automotive and Distribution and focuses on off-shore and outsourcing operations for clients in India and the U.S.A. The total revenue of TVSN during the year under review was at '' 82.86 Crores as against '' 73.11 Crores in the previous year. The net profit was at '' 10.92 Crores as against '' 12.56 Crores in the previous year.
Sunfast TVS Limited (Sunfast), a wholly-owned subsidiary is engaged in the business of marketing of aerospace and defence components. The total revenue of Sunfast during the year under review was at '' 0.77 Crores as against '' 0.24 Crores in the previous year. The net profit was at '' 0.04 Crores as against a net loss of '' (0.01) Crores during the year.
TVS Engineering Limited (TEL), a wholly-owned subsidiary is engaged in the manufacture of non-auto, aerospace and defence components. The total revenue of TEL during the year under review was at '' 3.47 Crores as against '' Nil in the previous year. The net (loss) were at '' (0.70) Crores as against net (loss) at '' (0.99) Crores during the year under review.
The total revenue of Sundram International Inc., USA, a wholly-owned subsidiary during the year under review was at '' Nil as against '' Nil in the previous year. The net profit / (loss) was at '' Nil as against '' Nil in the previous year.
Sundram International Limited, United Kingdom, a wholly-owned overseas subsidiary, was established as an intermediate holding company that holds investments in two operating subsidiaries viz., in China and United Kingdom. The total revenue from Sundram International Limited during the year under review was at '' 0.21 Crores as against '' 32.04 Crores (earned by way of dividend) in the previous year. The net (loss) was at '' (27.20) Crores as against net profit of '' 31.20 Crores in the previous year.
The total revenue from all the subsidiaries of the Company in aggregate during the year under review was at '' 849.36 Crores resulting in an overall contribution of 14.88% of the consolidated revenue as against '' 815.83 Crores which resulted in an overall contribution of 16.51% of the consolidated revenue in the previous year.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statement of the Companyâs subsidiaries, Associates and Joint Ventures in detail in Form AOC-1 is enclosed to the financial statement of the Company in Page No 244.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYâS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
No Company has become or ceased to be Companyâs subsidiary, joint venture or associate company during the financial year 2022-23.
AMALGAMATION OF SUNFAST TVS LIMITED AND TVS ENGINEERING LIMITED, WHOLLY-OWNED SUBSIDIARIES WITH SUNDRAM FASTENERS LIMITED (HOLDING COMPANY)
During the year, Sunfast TVS Limited and TVS Engineering Limited, wholly-owned subsidiaries of the Company have
submitted a joint application with the Honâble National Company Law Tribunal, Chennai Bench seeking its approval for the amalgamation of Sunfast TVS Limited and TVS Engineering Limited with the Company. The application is pending for approval by Honâble National Company Law Tribunal, Chennai Bench.
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
PROCEEDINGS PENDING, IF ANY, UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016
The Company has neither filed an application during the year under review nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at March 31,2023.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF
No such event has occurred during the year under review.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company has in-house internal audit team to monitor the effectiveness of internal financial controls, ensuring adequacy with respect to financial statement and verify whether the financial transaction flow in the organisation is being done based on the approved policies of the Company. The internal auditor presents the internal audit report and the management comments on the internal audit observations every quarter to the Audit Committee. The internal control mechanisms are in place for safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The statement in terms of Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 is enclosed vide Annexure V forming part of this report.
Pursuant to Section 136 (1) of the Companies Act, 2013, the report of the Board of Directors is being sent to the shareholders of the Company excluding the statement prescribed under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The statement is available for inspection by the shareholders at the Registered Office of the Company during business hours.
Pursuant to Section 139 of the Companies Act, 2013, M/s. B S R & Co. LLP, Chartered Accountants, Chennai, (Registration No. 101248 W / W- 100022 with the Institute of Chartered Accountants of India), were appointed as Statutory Auditors of the Company at the Fifty Ninth Annual General Meeting (AGM) of the Company for the second term of five consecutive years commencing from the conclusion of the Fifty Ninth AGM (i.e., June 29, 2022). M/s. BSR & Co. LLP holds Peer Review Certificate No 014196 dated May 18, 2022 issued by the Institute of Chartered Accountants of India.
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2022-2023. Secretarial Audit Report issued by Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed vide Annexure VI forming part of this report and does not contain any qualification. The Board of Directors has appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2023-2024. Necessary consent has been received from them to act as Secretarial Auditors. M/s. S. Krishnamurthy & Co, Company Secretaries holds Peer Review Certificate No. 739/2020 dated May 28, 2020, issued by the Institute of Company Secretaries of India, which is valid for a period of five years from the date of issue.
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Companies (Cost Records and Audit) Rules, 2014, as amended, the Board of Directors has appointed Sri P Raju Iyer, Practising Cost Accountant (Membership No.6987) as Cost Auditor for the financial year 2023-2024. The Audit Committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder. As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are made and maintained.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the calendar year 2022.
The Company has complied with the mandatory applicable Secretarial Standards on Board Meetings and General Meetings (including Postal Ballots) issued by the Institute of Company Secretaries of India.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Pursuant to Sections 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has a Vigil Mechanism through a Whistle Blower Policy. The details about the whistle blower policy are provided in the Annual Report Disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Industrial relations continued to remain congenial during the year under review. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited, a step-down subsidiary. The Directors wish to thank One North East, the Regional Development Authority for Cramlington, United Kingdom for the continued support extended to the step down subsidiary. The Directors wish to thank the Companyâs bankers, State Electricity Boards in Tamil Nadu, Pondicherry, Telangana, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the support provided by them from time to time.
On behalf of the Board
May 4, 2023 Chairman
Chennai DIN: 00046919
Mar 31, 2022
The Directors are pleased to present the Fifty Ninth Annual Report together with the audited financial statements for the year ended March 31,2022.
FINANCIAL HIGHLIGHTS (STANDALONE) |
'' in Crores |
|
2021 - 2022 |
2020 - 2021 |
|
Revenue from Operations |
4,172.57 |
3,065.03 |
Other Income |
25.61 |
16.57 |
Total Revenue |
4,198.18 |
3,081.60 |
Total Expenditure |
3,446.00 |
2,482.75 |
Gross Profit before interest, depreciation and taxes |
752.18 |
598.85 |
Less: Interest |
6.22 |
20.97 |
Exchange Losses / (Gains) |
7.17 |
(6.81) |
Depreciation |
152.83 |
146.58 |
Provision for impairment of investments in subsidiaries |
30.00 |
- |
Profit before Tax |
555.96 |
438.11 |
Less: Provision for tax |
148.50 |
109.97 |
Profit after Tax |
407.46 |
328.14 |
Add: Balance brought forward |
155.70 |
154.44 |
Balance available for appropriation |
563.16 |
482.58 |
Appropriations |
||
Interim / Final Dividends |
206.98 |
27.32 |
Transfer to Reserves |
150.00 |
300.00 |
Transfer from other comprehensive income to reserves |
(1.41) |
(0.44) |
Balance carried forward |
207.59 |
155.70 |
563.16 |
482.58 |
The Company has transferred '' 150 Crores to Reserves. DIVIDEND
The Board had during the year, declared an interim dividend of '' 6.45/- per share (645%) for the financial year 2021-2022 absorbing a sum of '' 135.53 Crores and the same was paid to the shareholders on March 4, 2022. No final dividend has been recommended by the Board of Directors.
The Dividend Distribution Policy, formulated in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is available on the Companyâs website at:- http://sundram.com/pdf/ corporate/DividendDistributionPolicy02022017.pdf
CONSOLIDATED FINANCIAL STATEMENT
In addition to the financial statement, the audited Consolidated Financial Statement of the Company and all of the subsidiaries prepared in the same form and manner as that of its own and in accordance with the applicable Accounting Standards (Ind AS), form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited / unaudited financial statement in respect of each of its subsidiary on its website, www.sundram.com. The Company shall provide a copy of audited / unaudited financial statement, as the case may be, as prepared in respect of each of its subsidiary, upon request by any of its shareholders.
A separate report on Corporate Governance together with a certificate from the Companyâs auditors confirming the compliance of conditions of Corporate Governance is enclosed to this report. Management Discussion and Analysis detailing the state of the companyâs affairs is also enclosed to this report (Please refer Page Nos. 37 to 42).
BUSINESS RESPONSIBILITY REPORT
Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility Report for the year ended March 31, 2022 is enclosed to this report (Please refer Page Nos. 43 to 51).
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The existing composition of the Companyâs Board is fully in conformity with the applicable provisions of the Companies Act, 2013 and Regulations 17 and 17A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with regard to independent directors, women directors and maximum number of directorships in listed entities.
Sri R. Srinivasan (DIN: 00043658) Independent Director, retired from the Board effective, September 22, 2021. The Company has benefited immensely through his association and the Board of Directors place on record their sincere thanks for the services rendered by him as a Director.
Dr. V. Anantha Nageswaran (DIN: 00760377) was appointed as a Non-Executive Independent Director for a period of five years effective September 16, 2021. In the opinion of the Board of Directors, Dr. V. Anantha Nageswaran fulfilled the conditions with regard to integrity, expertise and experience (including the proficiency) specified in the Act and the Rules made there under and is independent of the management. He was exempted from passing the online self-assessment test having served as a Director / Key Managerial Personnel for a period of not less than 3 years in a listed company or in an unlisted public company having a paid up capital of not less than '' 10 Crores. However, Dr. V Anantha Nageswaran had stepped down from the Board of Sundram Fasteners Limited with effect from January 28, 2022, in view of his appointment as the Chief Economic Adviser to the Government of India.
Ms. Preethi Krishna , Non-Executive Director (DIN: 02037253) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The Board recommends her re-appointment as a Director of the Company. A brief resume of Ms. Preethi Krishna and other relevant information have been furnished in the notice convening the AGM.
Sri S Meenakshisundaram (DIN: 00513901) whose appointment as the Whole-Time Director was approved by the shareholders at the Annual General Meeting held on June 11, 2020, has retired from the office of Whole-time
Director with effect from the closing hours of April 22, 2022. He will continue as the Chief Financial Officer of the Company upto the closing hours of June 30, 2022 to ensure smooth transition and will retire from the services of the Company effective July 1, 2022.
Sri R Dilip Kumar, presently holding the position in the Company as Executive Vice President-Finance & Company Secretary is appointed as the Chief Financial Officer of the Company effective July 1, 2022. In view of the foregoing, Sri R Dilip Kumar will relinquish the office of the Company Secretary effective July 1, 2022.
Sri G Anand Babu is appointed as the Company Secretary and the Compliance Officer of the Company effective July 1, 2022.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
In terms of the requirement of Section 92(3) read with Section 134(3) of the Companies Act, 2013, the draft annual return of the Company as on March 31,2022 is available on the Companyâs website, www.sundram.com.
During the year, six meetings of the Board of Directors were held. The details of the meetings and the attendance are furnished in the Annual Report disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which is attached to this Report (Please refer Page No 55).
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and made judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended March 31,2022.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
DETAILS IN RESPECT OF FRAUD, IF ANY, REPORTED BY THE AUDITORS
M/s. B S R & Co. LLP, Chartered Accountants, Chennai, the Statutory Auditors of the Company have stated that during the course of their audit, there were no fraud by the Company or on the Company by its officers or employees, noticed or reported in the Independent Auditorsâ Report which forms part of this Report. Hence, there was no requirement to report the same to the Audit Committee or Board of Directors of the Company.
NOMINATION AND REMUNERATION POLICY
Salient features of the Policy:
The Policy is to ensure that the remuneration is in line with best comparable market practices, as well as competitive visa-vis that of comparable companies both in India and other international markets, which will have a motivating effect to act as a driving force to ensure long term availability of talent and also retention of the best talents. The Policy will have due regard to the situation of the specific regions in which the Company operates.
A brief description about the Companyâs Nomination and Remuneration Policy on Directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other related matters provided in Section 178(3) of the Companies Act, 2013 are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Please refer Page No.56).
The Nomination and Remuneration Policy is available on the Companyâs website at:- https://sundram.com/pdf/corporate/ NominationandRemunerationPolicy.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient is enclosed vide Annexure - I.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on armâs length basis and in the ordinary course of business. There was no
material related party contract during the year. Form AOC-2 as required under Section 134 (3)(h) of the Companies Act, 2013 is enclosed vide Annexure - II to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 is enclosed vide Annexure - III.
Brief description of terms of reference:-
i. To review and approve the risk management policy of the Company and to make amendments thereto from time to time.
ii. To monitor and oversee implementation of the risk management policy, including evaluating the adequacy of risk management systems.
iii. To periodically review the risk management policy, by considering the changing industry dynamics and evolving complexity.
iv. To identify methodology, processes and systems to monitor and evaluate risk.
v. To identify internal and external risks in particular including financial, operational, sectoral, department-wise risk, business sustainability particularly, Environmental, Social and Governance (ESG) related risks, information, cyber security risks. Cyber security risks cover ransomware, phishing, data leakage, hacking, insider threat etc.
The Company manages its risks through continuous review of business parameters on a regular basis by the management. Insurable risks are analysed and insurance policies are taken to protect the companyâs interests. The Audit Committee is also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
During the year, two meetings of the Risk Management Committee were held. The details of the meeting are furnished in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this Report (Please refer Page No 58).
The total revenue from TVS Next Inc., USA, a step-down overseas subsidiary during the year under review was at '' 15.93 Crores as against '' 5.02 Crores in the previous year. The net profit / (loss) was at '' 0.33 Crores as against '' (0.36) Crores in the previous year.
TVS Upasana Limited is a wholly-owned subsidiary and is engaged in the manufacture of Spokes and Nipples, automobile kits, tools, dowel pins, small screws, Cold Extruded Parts and other parts catering to automotive industry. The total revenue from TVS Upasana Limited during the year under review was at '' 165.67 Crores as against '' 150.36 Crores in the previous year. The net profit was at '' 5.75 Crores as against '' 11.35 Crores in the previous year. The total revenue from Sundram Non-Conventional Energy Systems Limited, a subsidiary during the year under review was at '' 2.79 Crores as against '' 2.75 Crores in the previous year. The net profit was at '' 2.00 Crores as against '' 1.57 Crores in the previous year.
The total revenue from Sundram Fasteners Investments Limited, a wholly-owned subsidiary during the year under review was at '' 0.36 Crores as against '' 0.02 Crores in the previous year. The net profit / (loss) was at '' 0.30 Crores as against '' 0.008 Crores in the previous year.
TVS Next Limited (TVSN), a subsidiary engaged in the information technology business providing Enterprise Solutions for core industries like Manufacturing, Automotive and Distribution and focuses on off-shore and outsourcing operations for clients in India and the U.S.A. The total revenue from TVSN during the year under review was at '' 73.11 Crores as against '' 49.32 Crores in the previous year. The net profit was at '' 12.56 Crores as against '' 8.99 Crores in the previous year.
Sunfast TVS Limited (Sunfast), a wholly-owned subsidiary is engaged in the business of marketing of aerospace and defence components. The total revenue from Sunfast during the year under review was at '' 0.24 Crores as against '' 0.09 Crores in the previous year. The net profit / (loss) was at '' (0.01) Crores as against '' 0.004 Crores during the year under review.
TVS Engineering Limited (TEL), a wholly-owned subsidiary is engaged in the manufacture of aerospace and defence components. The total revenue from TEL during the year under review was at '' Nil Crores as against '' Nil Crores in the previous year. The net profit / (loss) were at '' (0.99) Crores as against '' (0.68) Crores during the year under review.
The total revenue from Sundram International Inc., USA, a wholly-owned subsidiary during the year under review was at '' Nil Crores as against '' Nil Crores in the previous year. The net profit / (loss) was at '' Nil Crores as against '' (0.004) Crores in the previous year.
Sundram International Limited, United Kingdom, a wholly-owned overseas subsidiary, was established as an intermediate holding company that holds investments in two operating subsidiaries viz., in China and United Kingdom. The total revenue from Sundram International Limited earned
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The salient features of the Policy are to:
i. actively engage and extend support to the communities in which it operates and thus build a better, sustainable way of life by supporting the weaker sections of the society and thus contribute to the human development;
ii. drive measures and to provide solutions that will balance economic, social and environmental issues; and
iii. work together with our employees with a commitment for adhering to responsible business practices in terms of quality management, environmental sustainability and support to the community.
The Company has undertaken activities as per the CSR Policy and the Annual report on CSR activities for the Financial Year 2021-2022 is enclosed vide Annexure - IV forming part of this report.
The CSR Policy, including the annual action plan is available on the Companyâs website at www.sundram.com/ investors.php.
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this report.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
The Company has six Domestic Subsidiaries and five Overseas Subsidiaries. The financial performance of the subsidiaries during the financial year 2021-2022 is given hereunder:-
Sundram Fasteners (Zhejiang) Limited, China (SFZL, China), Cramlington Precision Forge Limited, United Kingdom (CPFL, UK) and TVS Next Inc., USA are step-down overseas subsidiaries of the Company. The principal activity of SFZL, China is manufacture of fasteners and bearing housing and that of CPFL, UK is manufacture of precision forgings.
The total revenue from SFZL, China during the year under review was at '' 369.10 Crores as against '' 305.64 Crores in the previous year. The net profit was at '' 9.63 Crores as against '' 21.09 Crores in the previous year.
The total revenue from CPFL, UK during the year under review was at '' 156.18 Crores as against '' 104.78 Crores in the previous year. The net profit / (loss) was at '' (9.25) Crores as against net profit / (loss) at '' (5.08) Crores in the previous year.
by way of dividend, during the year under review was at '' 32.04 Crores as against '' 31.19 Crores in the previous year. The net profit was at '' 31.19 Crores as against '' 4.19 Crores in the previous year.
The total revenue from all the subsidiaries of the Company in aggregate during the year under review was at '' 815.84 Crores resulting in an overall contribution of 16.51% of the consolidated revenue as against '' 648.77 Crores which resulted in an overall contribution of 17.67% of the consolidated revenue in the previous year.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statement of the Companyâs subsidiaries, Associates and Joint Ventures in detail in Form AOC-1 is enclosed to the financial statement of the Company in Page No 220.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYâS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
No Company has become or ceased to be Companyâs subsidiary, joint venture or associate company during the financial year 2021-2022.
The Honâble National Company Law Tribunal, Chennai bench, vide its order dated December 6, 2021 had approved the composite scheme of amalgamation and arrangement (demerger) inter alia amongst T V Sundram Iyengar & Sons Private Limited (âTVSSâ), Sundaram Industries Private Limited (âSIPLâ), Southern Roadways Private Limited (âSRPLâ) and TVS Sundram Fasteners Private Limited (âTPLâ) (âComposite Schemeâ) in accordance with Sections 230 to 232 and other applicable provisions under the Companies Act, 2013 read with the rules made thereunder and other applicable laws. The Composite Scheme was made effective on January 6, 2022 (âEffective Dateâ).
As per the Composite Scheme, on the Effective Date, SIPL and SRPL were amalgamated with TVSS and have been dissolved without the process of winding up. As a result of this, the shareholding of SRPL in Sundram Fasteners Limited (SFL) consisting of 5,07,73,280 equity shares was vested in / transferred to TVSS. This had resulted in the increase of the direct shareholding of TVSS in SFL from 5,33,12,000 equity shares to 10,40,85,280 equity shares (representing 49.53% of its paid-up equity share capital).
As a subsequent step to the above, in terms of the Composite Scheme, on February 4, 2022, TVSS demerged a business undertaking which included shareholding of 49.53% (10,40,85,280 equity shares) held in the Company to TPL. Consequent to the above, TPL has become the Promoter of SFL.
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
PROCEEDINGS PENDING, IF ANY, UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016
The Company has neither filed an application during the year under review nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at March 31,2022.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF
No such event has occurred during the year under review.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company has in-house internal audit team to monitor the effectiveness of internal financial controls, ensuring adequacy with respect to financial statement and verify whether the financial transaction flow in the organisation is being done based on the approved policies of the Company. The internal auditor presents the internal audit report and the management comments on the internal audit observations every quarter to the Audit Committee. The internal control mechanisms are in place for safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The statement in terms of Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide Annexure V forming part of this report.
Pursuant to Section 136 (1) of the Companies Act, 2013, the report of the Board of Directors is being sent to the shareholders of the Company excluding the statement prescribed under Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014. The statement is available for inspection by the shareholders at the Registered Office of the Company during business hours.
Pursuant to Section 139 of the Companies Act, 2013, M/s. B S R & Co. LLP, Chartered Accountants, Chennai, (Registration No. 101248 W / W- 100022 with the Institute of Chartered Accountants of India), were appointed as Statutory Auditors of the Company at the Fifty Fourth Annual General Meeting (AGM) of the Company for a consecutive period of five years commencing from the conclusion of the Fifty Fourth AGM (i.e., August 24, 2017), whose term expires upon the conclusion of this Annual General Meeting.
The Board of Directors have recommended the re-appointment of M/s. B S R & Co. LLP, Chartered Accountants, Chennai as the statutory auditors of the Company, for the second term of five consecutive years, till the conclusion of the Annual General Meeting of the Company for the financial year 2026-2027. The Company has received consent from M/s. B S R & Co. LLP, Chartered Accountants, Chennai to serve as statutory auditors of the Company, if they are so appointed. They have also furnished necessary certificate required under the Companies Act, 2013 conveying their eligibility for appointment. M/s. B S R & Co. LLP, Chartered Accountants, Chennai holds Peer Review Certificate No. 011748 dated July 2, 2019, issued by the Institute of Chartered Accountants of India, which is valid for a period of three years from the date of issue.
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2021-2022. Secretarial Audit Report issued by Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed vide Annexure VI forming part of this report and does not contain any qualification. The Board of Directors has appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2022-2023. Necessary consent has been received from them to act as Secretarial Auditors. M/s. S. Krishnamurthy & Co, Company Secretaries holds Peer Review Certificate No. 739/2020 dated May 28, 2020, issued by the Institute of Company Secretaries of India, which is valid for a period of five years from the date of issue.
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Rule 14 of the Companies (Cost Records and Audit) Rules, 2014, as amended, the Board of Directors has appointed Sri P Raju Iyer, Practising Cost Accountant (Membership No.6987) as the Cost Auditor for the financial year 2022-2023. The audit committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder. As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost
records are required to be maintained by the Company and accordingly such accounts and records are made and maintained.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the calendar year 2021.
The Institute of Company Secretaries of India has issued Secretarial Standards (Meetings of the Board and General Meetings) on various aspects of corporate law and practices. The Company has complied with each one of them.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Pursuant to Sections 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has a Vigil Mechanism through a Whistle Blower Policy. The details about the whistle blower policy are provided in the Annual Report Disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Industrial relations continued to remain congenial during the current year. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited, a step-down subsidiary. The Directors wish to thank One North East, the Regional Development Authority for Cramlington Precision Forge Limited, United Kingdom for the continued support extended to the step down subsidiary. The Directors wish to thank the Companyâs bankers, State Electricity Boards in Tamil Nadu, Puducherry, Telangana, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the assistance rendered by them from time to time.
On behalf of the Board
April 22, 2022 Chairman
Chennai DIN:00046919
Mar 31, 2021
The Directors are pleased to present the Fifty Eighth Annual Report together with the audited financial statement for the year ended March 31,2021.
FINANCIAL HIGHLIGHTS (STANDALONE) |
'' in Crores |
|
2020 - 2021 |
2019 - 2020 |
|
Revenue from Operations |
3,065.03 |
3,124.57 |
Other Income |
16.57 |
20.44 |
Total Revenue |
3,081.60 |
3,145.01 |
Total Expenditure |
2,482.75 |
2,576.94 |
Gross Profit before interest, depreciation and taxes |
598.85 |
568.07 |
Less: Interest |
20.97 |
32.97 |
Exchange Losses / (Gains) |
(6.81) |
10.89 |
Depreciation |
146.58 |
136.51 |
Provision for impairment of investments in subsidiaries |
- |
11.30 |
Profit before Tax |
438.11 |
376.40 |
Less: Provision for tax |
109.97 |
62.36 |
Profit after Tax |
328.14 |
314.04 |
Add: Balance brought forward |
154.44 |
*188.03 |
Balance available for appropriation |
482.58 |
502.07 |
Appropriations |
||
Interim / Final Dividends |
27.32 |
152.34 |
Tax on Interim Dividends |
- |
29.79 |
Transfer to Reserves |
300.00 |
200.00 |
Transfer from special economic zone reinvestment reserve |
- |
(35.73) |
Transfer from other comprehensive income to reserves |
(0.44) |
1.23 |
Balance carried forward |
155.70 |
154.44 |
482.58 |
502.07 |
* Includes P&L carried forward balance of Sundram Precision Components Limited (an erstwhile wholly-owned subsidiary of the Company) on account of amalgamation with the Company.
The Company has transferred '' 300 Crores to Reserves. DIVIDEND
The Board had earlier during the year, declared an interim dividend of '' 1.30/- per share (130%) absorbing a sum of '' 27.32 Crores and the same was paid to the shareholders on November 27, 2020. The Directors have decided to pay a Second Interim Dividend of '' 3.40 per share (340%), which, together with the first interim dividend, declared and paid earlier, would amount to a total dividend of ''4.70/- per share
(470%) for the financial year 2020-2021. No final dividend has been recommended by the Board of Directors.
The Dividend Distribution Policy, formulated in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is available on the Company''s website at:- http://sundram.com/pdf/corporate DividendDistributionPolicy02022017.pdf
CONSOLIDATED FINANCIAL STATEMENT
In addition to the financial statement, the audited Consolidated Financial Statement of the Company and all of the
subsidiaries prepared in the same form and manner as that of its own and in accordance with the applicable Accounting Standards (Ind AS), form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited / unaudited accounts in respect of each of subsidiary on its website, www.sundram.com. The Company shall provide a copy of audited / unaudited financial statement, as the case may be, as prepared in respect of each of its subsidiary, upon request by any of its shareholders.
A separate report on Corporate Governance together with a certificate from the Company''s auditors confirming the compliance of conditions of Corporate Governance is enclosed to this report. Management Discussion and Analysis detailing the state of the company''s affairs is also enclosed to this report (Please refer Page Nos. 35 to 41).
BUSINESS RESPONSIBILITY REPORT
Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility Report for the year ended March 31, 2021 is enclosed to this report (Please refer Page Nos. 42 to 50).
The existing composition of the Company''s Board is fully in conformity with the applicable provisions of the Companies Act, 2013 and Regulations 17 and 17A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with regard to independent directors, women directors and maximum number of directorships in listed entities.
Sri Suresh Krishna (DIN: 00046919), has been re-appointed as the Chairman and Non-Executive Director for a period of 5 years effective, July 1,2021.
Ms Arathi Krishna (DIN: 00517456) has been re-appointed as the Managing Director of the Company for a period of 5 years effective May 3, 2021.
Sri S Meenakshisundaram (DIN: 00513901) has been appointed as the Whole-Time Director (Designated as Whole-Time Director and Chief Financial Officer) for a period of 2 years effective June 11, 2020.
Ms Arathi Krishna, Managing Director (DIN: 00517456) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The Board, therefore, recommends her re-appointment as a Director of the Company. A brief resume of Ms Arathi Krishna and other relevant information have been furnished in the notice convening the AGM.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
In terms of the requirement of Section 1 34(3) read with Section 92(3) of the Companies Act, 2013, the draft annual return of the Company as on March 31,2021 is available on the Companyâs website, www.sundram.com.
During the year, six meetings of the Board of Directors were held. The details of the meetings and the attendance are furnished in the Annual Report disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which is attached to this Report (Please refer Page No 53).
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and made judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended March 31,2021.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY
Salient features of the Policy:
The policy is to ensure that the remuneration is in line with best comparable market practices, as well as competitive visa-vis that of comparable companies both in India and other international markets, which will have a motivating effect to act as a driving force to ensure long term availability of talent and also retention of the best talents. The Policy will have due regard to the situation of the specific regions in which the Company operates.
A brief description about the Companyâs Nomination and Remuneration Policy on Directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other related matters provided in Section 178(3) of the Companies Act, 2013 are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Please refer Page Nos. 55 & 56).
The Nomination and Remuneration Policy is available on the Company''s website at: - https://sundram.com/pdf/corporate/ NominationandRemunerationPolicy.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient is enclosed vide Annexure - I.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on armâs length basis and in the ordinary course of business. There was no material related party contract during the year. Form AOC-2 as required under Section 134 (3)(h) of the Companies Act, 2013 is enclosed vide Annexure - II to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo
pursuant to Section 134 of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 is enclosed vide Annexure - III.
Brief description of terms of reference:-
i. continuous review of business parameters on a regular basis by the management, including commodity hedging positions in a more transparent, detailed and uniform manner.
ii. exercising prudence while incurring capital expenditure or outlays on new projects.
iii. entering into long term contracts with customers to underwrite the capacities created
iv. adoption of a diversified business model in terms of products, market segments, geography and customers to ensure that Company is able to withstand any instability in the entire business eco-system
v. judicious approach to proportionate sourcing of inputs from indigenous and overseas markets in order to take advantage of commodity prices and exchange rate movements
vi. monitoring, reviewing and hedging foreign exchange risks in accordance with the risk management policy
The Company manages its risks through continuous review of business parameters on a regular basis by the management. Insurable risks are analysed and insurance policies are taken to protect the company''s interests. The Audit Committee is also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
During the year, one meeting of the Risk Management Committee was held. The details of the meeting are furnished in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this Report (Please refer Page No 57).
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The salient features of the Policy are to:
i. actively engage and extend support to the communities in which it operates and thus build a better, sustainable way of life by supporting the weaker sections of the society and thus contribute to the human development;
ii. impel measures and to provide solutions that will balance economic, social and environmental issues; and
iii. work together with the employees with a commitment for adhering to responsible business practices in terms of quality management, environmental sustainability and support to the community.
The Company has undertaken activities as per the CSR Policy (available on the Company''s website http://www. sundram.com/investors.php) and the Annual report on CSR activities is enclosed vide Annexure - IV forming part of this report.
The Company has amended its CSR Policy in line with the amendments introduced in the Companies ((Corporate Social Responsibility) Amendment Rules, 2021 and has also uploaded the amended policy in its website www.sundram.com/investors.php in accordance with the statutory provisions.
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which forms part of this report.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
The Company has 6 Domestic Subsidiaries and 5 Overseas Subsidiaries. The financial performance of the subsidiaries during the financial year 2020-2021 is given hereunder:-
Sundram Fasteners (Zhejiang) Limited, China (SFZL, China), Cramlington Precision Forge Limited, United Kingdom (CPFL, UK) and TVS Next Inc., USA, (formerly known as TVS Infotech Inc.) are step-down overseas subsidiaries of the Company. The principal activity of SFZL, China is manufacture of fasteners and bearing housing and that of CPFL, UK is manufacture of precision forgings.
The total revenue from SFZL, China during the year under review was at '' 305.64 Crores as against '' 283.72 Crores in the previous year (January 2019 to March 2020). The net profit was at '' 21.09 Crores as against '' 9.23 Crores in the previous year.
The total revenue from CPFL, UK during the year under review was at '' 104.78 Crores as against '' 140.06 Crores in the previous year (January 2019 to March 2020). The net loss was at '' (5.08) Crores as against net loss at '' (16.72) Crores in the previous year.
The total revenue from TVS Next Inc., USA, (formerly known as TVS Infotech Inc., USA), a step-down overseas subsidiary during the year under review was at '' 5.02 Crores as against '' 10.86 Crores in the previous year. The net loss was at '' (0.36) Crores as against '' (0.26) Crores in the previous year .
The total revenue from Sundram International Limited, United Kingdom a wholly-owned overseas subsidiary during the year under review was at '' 31.19 Crores as against '' 2.94 Crores in the previous year. The net profit was at '' 4.19 Crores as against '' (36.09) Crores in the previous year due to the provision for diminution in the value of investments amounting to '' 37.12 Crores.
TVS Upasana Limited is a wholly owned subsidiary and is engaged in the manufacture of Spokes and Nipples, automobile kits, tools, dowel pins, small screws, Cold Extruded Parts and other parts catering to automotive industry. The total revenue from TVS Upasana Limited during the year under review was at '' 150.36 Crores as against '' 148.01 Crores in the previous year. The net profit was at '' 11.35 Crores as against '' 8.72 Crores in the previous year.
The total revenue from Sundram Non-Conventional Energy Systems Limited, a subsidiary during the year under review was at '' 2.75 Crores as against '' 2.93 Crores in the previous year. The net profit was at '' 1.57 Crores as against '' 1.64 Crores in the previous year.
The total revenue from Sundram Fasteners Investments Limited, a wholly-owned subsidiary during the year under review was at '' 0.004 Crores as against '' 0.008 Crores in the previous year. The net profit / (loss) was at '' (0.003) Crores as against '' (0.005) Crores in the previous year.
TVS Next Limited (Formerly known as TVS Infotech Limited) [TVSN], a subsidiary engaged in information technology business providing Enterprise Solutions for core industries like Manufacturing, Automotive and Distribution and focuses on off-shore and outsourcing operations for clients in India and the U.S.A. The total revenue from TVSN during the year under review was at '' 49.32 Crores as against '' 40.05 Crores in the previous year. The net profit was at '' 8.99 Crores as against '' 1.62 Crores in the previous year.
Sunfast TVS Limited (Sunfast), a wholly owned subsidiary is engaged in the business of marketing of aerospace and defence components. The total revenue from Sunfast during the year under review was at '' 0.09 Crores as against '' 0.003 Crores in the previous year. The net profit / (loss) was at '' 0.004 Crores as against '' (0.02) Crores during the year under review.
TVS Engineering Limited (TEL), a wholly owned subsidiary is engaged in the manufacture of aerospace and defence components. The total revenue from TEL during the first year of its incorporation was at '' Nil. The net loss was at '' (0.68) Crores during the year under review.
The total revenue from all the subsidiaries of the Company in aggregate during the year under review was at '' 648.77 Crores resulting in an overall contribution of 17.67% of the consolidated revenue.
being done based on the approved policies of the Company. The internal auditor presents the internal audit report and the management comments on the internal audit observations every quarter to the Audit Committee. The internal control mechanisms are in place for safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The statement in terms of Section 197(12) read with Rule
5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide Annexure V forming part of this report.
Pursuant to Section 136 (1) of the Companies Act, 2013, the report of the Board of Directors is being sent to the shareholders of the Company excluding the statement prescribed under Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014. The statement is available for inspection by the shareholders at the Registered Office of the Company during business hours.
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s. B S R & Co. LLP, Chartered Accountants, Chennai, (Registration No. 101248 W / W- 100022 with the Institute of Chartered Accountants of India), were appointed as Statutory Auditors of the Company at the Fifty Fourth Annual General Meeting (AGM) of the Company for a consecutive period of five years commencing from the conclusion of the Fifty Fourth AGM (i.e., August 24, 2017).
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2020-2021. Secretarial Audit Report issued by Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed vide Annexure VI forming part of this report and does not contain any qualification. The Board of Directors has appointed M/s. S Krishnamurthy
6 Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2021-2022. Necessary consent has been received from them to act as Secretarial Auditors. M/s. S Krishnamurthy & Co, Company Secretaries holds Peer Review Certificate No 739/2020 dated May 28, 2020, issued by the Institute of Company Secretaries of India, which is valid for a period of 5 years from the date of issue.
COST AUDITOR
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Companies (Cost Records and Audit) Rules, 2014,
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statement of the Companyâs subsidiaries, Associates and Joint Ventures in detail in Form AOC-1 is enclosed to the financial statement of the Company in Page No 198.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYâS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
No Company has become or ceased to be Companyâs subsidiary, joint venture or associate company during the financial year 2020-2021.
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
PROCEEDINGS PENDING, IF ANY, UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016
The Company has neither filed an application during the year under review nor are any proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at March 31,2021.
THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF.
No such event has occurred during the year under review.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company has in-house internal audit team to monitor the effectiveness of internal financial controls, ensuring adequacy with respect to financial statement and verify whether the financial transaction flow in the organisation is
as amended, the Board of Directors has appointed Sri P Raju Iyer, Practising Cost Accountant (Membership No.6987) as the Cost Auditor for the financial year 2021-2022. The audit committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder. As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are made and maintained.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the calendar year 2020.
The Institute of Company Secretaries of India has issued Secretarial Standards (Meetings of the Board and General Meetings) on various aspects of corporate law and practices. The Company has complied with each one of them, which are mandatory.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Pursuant to Sections 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, the Company has a Vigil Mechanism through a Whistle Blower Policy. The details about the whistle blower policy are provided in the Annual Report Disclosures under Regulation 34 read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
INDUSTRIAL RELATIONS
Industrial relations continued to remain congenial during the current year. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
ACKNOWLEDGMENT
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited, a step-down subsidiary. The Directors wish to thank One North East, the Regional Development Authority for Cramlington Precision Forge Limited, United Kingdom for the continued support extended to the step- down subsidiary. The Directors wish to thank the Companyâs bankers, State Electricity Boards in Tamil Nadu, Pondicherry, Telangana, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the assistance rendered by them from time to time.
On behalf of the Board
SURESH KRISHNA
May 6, 2021 Chairman
Chennai DIN: 00046919
Mar 31, 2019
REPORT OF THE BOARD OF DIRECTORS
The Directors are pleased to present the Fifty Sixth Annual Report together with the audited financial statements for the year ended March 31, 2019.
FINANCIAL HIGHLIGHTS (STANDALONE) |
Rs.in crores |
|
2018-19 |
2017-18 |
|
Revenue from operations |
4,002.34 |
3,419.79 |
Other income |
31.94 |
29.62 |
Total revenue (net of excise duty) |
4,034.28 |
3,449.41 |
Total expenditure |
3,265.45 |
2,799.05 |
Gross profit before interest, depreciation and taxes |
768.83 |
650.36 |
Less: Interest |
31.02 |
18.80 |
Exchange losses / (gains) |
7.94 |
13.76 |
Depreciation |
109.85 |
98.07 |
Profit before tax |
620.02 |
519.73 |
Less: Provision for tax |
182.90 |
152.26 |
Profit after tax |
437.12 |
367.47 |
Add: Balance brought forward |
171.36 |
220.82 |
Balance available for appropriation |
608.48 |
588.29 |
Appropriations |
||
Interim / Final dividends |
98.76 |
98.76 |
Tax on Interim dividends |
20.14 |
18.17 |
Transfer to reserves |
300.00 |
300.00 |
Transfer from special economic zone reinvestment reserve |
(10.75) |
- |
Transfer from other comprehensive income to reserves |
13.68 |
- |
Balance carried forward |
186.65 |
171.36 |
608.48 |
588.29 |
TRANSFER TO RESERVES
The Company has transferred Rs. 300.00 Crores to Reserves.
DIVIDEND
The Board had earlier during the year, declared an interim dividend of Rs. 2.00/- per share (200%) and the same was paid on November 22, 2018. The Directors have decided to pay a Second Interim Dividend of Rs. 3.10 per share, which, together with the first interim dividend, declared and paid earlier, would amount to a total dividend of Rs. 5.10/- per share for the financial year 2018-2019.
ABRIDGED FINANCIAL STATEMENT
In terms of the provision of Section 136(1) of the Companies Act, 2013, Rule 10 of Companies (Accounts) Rules, 2014 and Regulation 36 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has decided to circulate the Abridged financial statement to the shareholders for the financial year 2018-2019, who have not registered their e-mail id.
Members who desire to obtain the full version of the report may write to the Corporate Secretarial Department at the registered office address and will be provided with a copy of the same. Full version of the Annual Report will also be available on the Companyâs website, www.sundram.com
CONSOLIDATED FINANCIAL STATEMENT
In addition to the financial statements, the audited Consolidated Financial Statement of the Company and all of the subsidiaries prepared in the same form and manner as that of its own and in accordance with the applicable Accounting Standards (Ind AS), form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited accounts in respect of each of subsidiary on its website, www.sundram.com. The Company shall provide a copy of audited / unaudited financial statement, as the case may be, as prepared in respect of each of its subsidiary, upon request by any of its shareholders.
CORPORATE GOVERNANCE
A separate report on Corporate Governance together with a certificate from the Companyâs auditors confirming the compliance of conditions of Corporate Governance is attached to this report. Management Discussion and Analysis detailing the state of the companyâs affairs is also attached to this report (Please refer Page Nos. 43 to 47).
DIRECTORS
The existing composition of the Companyâs Board is fully in conformity with the applicable provisions of the Companies Act, 2013 and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with regard to independent directors and women directors.
Ms Preethi Krishna, Director (DIN: 02037253) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The Board, therefore, recommends her re-appointment as a Director of the Company. A brief resume of Ms Preethi Krishna and other relevant information have been furnished in the notice convening the AGM.
Sri V Narayanan (DIN 00081673), Independent Director, retired from the Board effective, September 22, 2018. The Company has benefited immensely through his association and the Board of Directors place on record their sincere thanks for the services rendered by him as a Director.
Dr Nirmala Lakshman, Director, (DIN 00141632) has been appointed as a Non-Executive Independent Director effective, September 20, 2018.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
EXTRACT OF ANNUAL RETURN
An extract of annual return in Form MGT-9 is annexed as Annexure - I and forms part of this report. In terms of the requirement of Section 134(3) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the same is available on the Companyâs website, www.sundram.com.
BOARD MEETINGS
During the year, five meetings of the Board of Directors were held. The details of the meetings are furnished in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which is attached to this Report (Please refer Page No. 60).
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and made judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended March 31, 2019.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the Company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY
Salient features of the Policy:
The policy is to ensure that the remuneration is in line with best comparable market practices, as well as competitive vis-a-vis that of comparable companies both in India and other international markets, which will have a motivating effect to act as a driving force to ensure long term availability of talent and also retention of the best talents. The Policy will have due regard to the situation of the specific regions in which the Company operates.
A brief description about the Companyâs Nomination and Remuneration Policy on directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other related matters provided in Section 178(3) of the Act are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Please refer Page Nos. 65 & 66).
The Nomination and Remuneration Policy is available on the Companyâs website at:- https://sundram.com/pdf/corporate/ NominationandRemunerationPolicy.pdf
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient is enclosed vide Annexure - II.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on armâs length basis and in the ordinary course of business. There was no material related party contract during the year. Form AOC-2 as required under Section 134 (3)(h) of the Act is enclosed vide Annexure - III to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Act read with Companies (Accounts) Rules, 2014 is enclosed vide Annexure - IV.
RISK MANAGEMENT
Pursuant to Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors at their meeting held on February 1, 2019 has constituted the Risk Management Committee. Sri Suresh Krishna, Chairman, Ms. Arathi Krishna, Managing Director and Ms. Arundathi Krishna, Joint Managing Director are members of the Committee.
Brief description of terms of reference:-
i. continuous review of business parameters on a regular basis by the management, including commodity hedging positions in a more transparent, detailed and uniform manner.
ii. exercising prudence while incurring capital expenditure or outlays on new projects.
iii. entering into long term contracts with customers to underwrite the capacities created
iv. adoption of a diversified business model in terms of products, market segments, geography and customers to ensure that Company is able to withstand any instability in the entire business eco-system
v. judicious approach to proportionate sourcing of inputs from indigenous and overseas markets in order to take advantage of commodity prices and exchange rate movements
vi. monitoring, reviewing and hedging foreign exchange risks in accordance with the risk management policy
The Company manages its risks through continuous review of business parameters on a regular basis by the management. Insurable risks are analysed and insurance policies are taken to protect the companyâs interests. The Audit Committee is also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The salient features of the Policy are to actively engage and extend support to the communities in which it operates and thus build a better, sustainable way of life by supporting the weaker sections of the society and thus contribute to the human development, to impel measures and to provide solutions that will balance economic, social and environmental issues and to work together with our employees with a commitment for adhering to responsible business practices in terms of quality management, environmental sustainability and support to the community.
The Company has undertaken activities as per the CSR Policy (available on the Companyâs website http://www.sundram.com/investors.php) and the Annual report on CSR activities is enclosed vide Annexure - V forming part of this report.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report attached as Annexure to this report.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
The Company has 7 Domestic Subsidiaries and 5 Overseas Subsidiaries. The financial performance of the subsidiaries during financial year 2018-19 are given hereunder:-
The Company, by way of initial subscription to the Memorandum of Association, has subscribed to 10,000 equity shares of âSunfast TVS Limitedâ. Sunfast TVS Limited has been incorporated as a new wholly-owned subsidiary of the Company under the Companies Act, 2013 with effect from April 8, 2019.
Sundram Fasteners (Zhejiang) Limited, China (SFZL, China) and Cramlington Precision Forge Limited, United Kingdom (CPFL, UK) are step-down overseas subsidiaries of the Company. The principal activity of CPFL, UK is manufacture of precision forgings and that of SFZL, China is manufacture of fasteners and bearing housing.
The revenue from operations from CPFL, UK during the year under review was at Rs. 11,936.91 lakhs as against Rs. 8,217.48 lakhs in the previous year. The net profit / (loss) was at '' (699.85) lakhs as against '' (458.72) lakhs in the previous year.
The revenue from operations from SFZL, China during the year under review was at Rs. 26,035.51 lakhs as against Rs. 18,832.33 lakhs in the previous year. The net profit was at Rs. 1,803.64 lakhs as against Rs. 1,331.43 lakhs in the previous year.
The revenue from operations from Sundram International Limited, a wholly-owned subsidiary during the year under review was at Rs. 170.32 lakhs as against Rs. 118.65 lakhs in the previous year. The net profit / (loss) was at '' (33.75) lakhs as against '' (72.20) lakhs in the previous year.
TVS Upasana Limited is a wholly-owned subsidiary and is engaged in the manufacture of Spokes and Nipples, automobile kits, tools, dowel pins, small screws, Cold Extruded Parts and other parts catering to automotive industry. The revenue from operations from TVS Upasana Limited during the year under review was at Rs. 17,218.98 lakhs as against Rs. 15,482.98 lakhs in the previous year. The net profit was at Rs. 1,604.69 lakhs as against Rs. 1,744.52 lakhs in the previous year.
Sundram Precision Components Limited (SPCL), a wholly-owned subsidiary is engaged in the manufacture of parts for motor vehicle, sintered parts such as valve guides, valve seats and other parts catering to automotive industry. The revenue from operations from SPCL during the year under review was at Rs. 2,606.84 lakhs as against Rs. 2,585.81 lakhs in the previous year. The net profit was at Rs. 151.59 lakhs as against Rs. 193.00 lakhs in the previous year. The application with respect to the amalgamation of SPCL (âTransferor Companyâ) with Sundram Fasteners Limited (âTransferee Companyâ) was filed by the transferor company during the financial year with the National Company Law Tribunal, Chennai Bench (NCLT). The final hearing by the NCLT with respect to the amalgamation of transferor company with the transferee company was held during April 2019. The matter was heard and the NCLT has sanctioned the scheme of amalgamation of SPCL with SFL and their respective shareholders, with Appointed Date as April 11, 2019.
The revenue from operations from Sundram Non-Conventional Energy Systems Limited, a subsidiary during the year under review was at Rs. 286.68 lakhs as against Rs. 364.36 lakhs in the previous year. The net profit was at Rs. 162.76 lakhs as against Rs. 208.53 lakhs in the previous year.
The revenue from operations from Sundram Fasteners Investments Limited, a wholly-owned subsidiary during the year under review was at Rs. 0.98 lakhs as against Rs. 0.52 lakhs in the previous year. The net profit / (loss) was at '' (0.34) lakhs as against '' (0.41) lakhs in the previous year.
TVS Infotech Limited (TVSi), a subsidiary is engaged in information technology business providing Enterprise Solutions for core industries like Manufacturing, Automotive and Distribution and focuses on off-shore and outsourcing operations for clients in India and the U.S.A. The revenue from operations from TVSi during the year under review was at Rs. 667.98 lakhs as against Rs. 786.59 lakhs in the previous year. The net profit was at Rs. 76.96 lakhs as against Rs. 15.49 lakhs in the previous year.
TVS Next Private Limited (TVSN) is a subsidiary of TVSi and a step-down subsidiary of the Company. TVSNâs focused efforts in targeting USA market and Indian Enterprise customers paid dividends in the form of increased revenues. The Company maintains a healthy sales pipeline in both USA and India. Improved utilisation of resources and relentless focus on cost control helped achieve higher profits this year. The revenue from operations from TVSN was at Rs. 2,191.56 lakhs as against Rs. 1,579.60 lakhs during the year under review. The net profit / (loss) was at Rs. 83.15 lakhs as against Rs. 70.69 lakhs in the previous year.
The application with respect to the amalgamation of TVSN (âTransferor Companyâ) with TVS Infotech Limited (âTransferee Companyâ) was filed by the transferor company during the financial year with the National Company Law Tribunal, Chennai Bench (NCLT). The final hearing by the NCLT with respect to the amalgamation of transferor company with the transferee company was held during April 2019. The matter was heard and the NCLT has sanctioned the scheme of amalgamation of TVSN with TVS Infotech Limited and their respective shareholders, with Appointed Date as April 01, 2018.
The revenue from operations from TVS Infotech Inc, a step-down subsidiary during the year under review was at Rs. 1,835.91 lakhs as against Rs. 2,306.45 lakhs in the previous year. The net profit was at Rs. 62.14 lakhs as against Rs. 84.07 lakhs in the previous year.
The revenue from operations from all the subsidiaries of the Company in aggregate during the year under review was at Rs. 550.42 Crores resulting in overall contribution of 12.00% of the consolidated revenue and 5.00% of the consolidated net profits.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Companyâs subsidiaries, Associates and Joint Ventures in detail in Form AOC-1 is attached to the financial statements of the Company (Please refer Page No.196).
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYâS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
No Company has become or ceased to be Companyâs subsidiary, joint venture or associate company during the financial year 2018-2019.
PUBLIC DEPOSITS
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
REGULATORY / COURT ORDERS
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company has in house internal audit team to observe the effective functioning of internal financial controls, ensuring adequacy with respect to financial statements and verify whether the financial transaction flow in the organisation is being done based on the approved policies of the Company. The internal auditor presents the internal audit report every quarter and management comments on the internal audit observations to the Audit Committee. The internal control mechanisms are in place for safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
APPOINTMENT AND REMUNERATION OF KEY MANAGERIAL PERSONNEL
The statement of particulars of Appointment and Remuneration of Key Managerial Personnel as per Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide Annexure VI forming part of this report.
Pursuant to Section 136 (1) of the Companies Act, 2013, the report of the Board of Directors is being sent to the shareholders of the Company excluding the statement prescribed under Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014. The statement is available for inspection by the shareholders at the Registered Office of the Company during business hours.
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, B S R & Co. LLP, Chartered Accountants, Chennai, (Registration No. 101248 W / W- 100022 with the Institute of Chartered Accountants of India), were appointed as Statutory Auditors of the Company at the Fifty Fourth Annual General Meeting (AGM) of the Company for a consecutive period of five years commencing from the conclusion of the Fifty Fourth AGM (i.e., August 24, 2017).
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2018-2019. Secretarial Audit Report issued by Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed in Annexure VII forming part of this report and does not contain any qualification. The Board of Directors has appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2019-2020. Necessary consent has been received from them to act as Secretarial Auditors.
COST AUDITOR
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Companies (Cost Records and Audit) Rules, 2014, as amended, the Board of Directors had appointed Sri P Raju Iyer, Practising Cost Accountant (Membership No.6987) as Cost Auditor for the financial year 2019-2020. The audit committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder. As specified by the Central Government under Section 148(1) of the Companies Act, 2013, the cost records are required to be maintained by the Company and accordingly such accounts and records are made and maintained.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. In compliance with the provisions under Section 4 of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013, Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. No complaint was received during the calendar year 2018.
SECRETARIAL STANDARDS
The Institute of Company Secretaries of India has issued Secretarial Standards (Meetings of the Board and General Meetings) on various aspects of corporate law and practices. The Company has complied with each one of them.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Pursuant to Sections 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has a Vigil Mechanism through a Whistle Blower Policy. The details about the whistle blower policy are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Board of Directors during the financial year 2018-2019 has amended the Whistle Blower Policy pursuant to the SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended on December 31, 2018 notified by the Securities and Exchange Board of India to enable employees to report instances of leak of unpublished price sensitive information. The amendment has come into effect from April 1, 2019.
INDUSTRIAL RELATIONS
Industrial relations continued to remain congenial during the current year. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
ACKNOWLEDGMENT
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited, a step-down subsidiary. The Directors wish to thank One North East, the Regional Development Authority for Cramlington, United Kingdom for the continued support extended to the step down Subsidiary. The Directors wish to thank the Companyâs bankers, State Electricity Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the assistance rendered by them from time to time.
On behalf of the Board
May 9, 2019 SURESH KRISHNA
Chennai Chairman
Mar 31, 2018
The Directors are pleased to present the Fifty Fifth Annual Report together with the audited financial statements for the year ended March 31, 2018. The Company celebrated its Golden Jubilee year in 2017. The 50 years milestone is a significant event in the annals of the company. The event was celebrated with the participation of the employees, directors and stakeholders of the company.
FINANCIAL HIGHLIGHTS (STANDALONE) |
Rs. in crores |
|
2017 - 18 |
2016-17 |
|
Revenue from Operations |
3,396.11 |
2,947.27 |
Other Income |
29.62 |
12.92 |
Total Revenue (net of excise duty) |
3,425.73 |
2,960.19 |
Total Expenditure |
2,775.36 |
2,407.13 |
Gross Profit before interest, depreciation and taxes |
650.37 |
553.06 |
Less: Interest |
18.80 |
30.31 |
Exchange Losses / (Gains) |
13.76 |
6.01 |
Depreciation |
98.07 |
89.77 |
Profit before Exceptional items and taxes |
519.73 |
426.97 |
Exceptional items |
- |
(2.37) |
Profit Before Tax |
519.73 |
424.60 |
Less: Provision for tax |
152.26 |
109.12 |
Profit after Tax |
367.47 |
315.48 |
Add: Balance brought forward |
220.82 |
198.28 |
Balance available for appropriation |
588.29 |
513.76 |
Appropriations |
||
Interim / Final Dividends |
98.76 |
35.72 |
Tax on Interim / Final Dividends |
18.17 |
7.22 |
Transfer to Reserves |
300.00 |
250.00 |
Balance carried forward |
171.36 |
220.82 |
588.29 |
513.76 |
TRANSFER TO RESERVES
The Company has transferred Rs.300 Crores to Reserves.
DIVIDEND
The Board had earlier during the year, declared first interim dividend of Rs.1.90 per share (190%) and the same was paid on November 21, 2017. The Directors have decided to pay a second interim dividend of Rs.2.70 per share (270%), which, together with the first interim dividend, declared and paid earlier, would amount to a total dividend of Rs.4.60 per share (460%) for the financial year 2017-2018.
The Dividend Distribution Policy, formulated in accordance with Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is available on the Companyâs website at:- http://sundram.com/pdf/ corporateZDividendDistributionPolicy02022017.pdf
CONSOLIDATED FINANCIAL STATEMENTS
The audited Consolidated Financial Statements of the Company prepared in accordance with the Companies Act, 2013 and the Accounting Standards (Ind AS), also form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited accounts of its subsidiaries on its website www.sundram. com. The Company will make available the audited annual accounts and associated information of its subsidiaries, upon request by any of its shareholders.
CORPORATE GOVERNANCE
A separate report on Corporate Governance together with a certificate from the Companyâs auditors confirming the compliance of conditions of Corporate Governance is attached to this report. Management Discussion and Analysis detailing the state of the companyâs affairs is also attached to this report (Please refer Page Nos. 37 to 40).
DIRECTORS
The existing composition of the Companyâs Board is fully in conformity with the applicable provisions of the Companies Act, 2013 and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with regard to independent directors and women directors.
Sri Suresh Krishna (DIN 00046919) retired as the Managing Director of the Company effective, April 20, 2018. He continues to be a Director and Chairman of the Board. Ms Arathi Krishna, Joint Managing Director (DIN 00517456) and Ms Arundathi Krishna, Deputy Managing Director (DIN: 00270935) were re-designated as Managing Director and Joint Managing Director respectively, effective April 20, 2018.
Ms Arathi Krishna, Managing Director (DIN: 00517456) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The board, therefore, recommends her re-appointment as a Director of the Company. A brief resume of Ms Arathi Krishna and other relevant information have been furnished in the notice convening the AGM.
Ms Preethi Krishna, Director (DIN 02037253) has been appointed as a Non-Executive Non-Independent Director effective, July 5, 2017.
Sri Heramb R Hajarnavis (DIN 01680435) has been appointed as a Non-Executive Independent Director effective, September 20, 2017.
Sri R Ramakrishnan and Sri M Raghupathy, Independent Directors, retired from the Board effective, September 22, 2017.
Sri C V Karthik Narayanan has ceased to be a Director effective December 13, 2017 consequent to his demise.
Sri S Mahalingam, Director, (DIN 00121727) has been appointed as a Non-Executive Independent Director effective, January 30, 2018.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
EXTRACT OF ANNUAL RETURN
An extract of annual return in Form MGT-9 is annexed as Annexure - I and forms part of this report.
BOARD MEETINGS
During the year, six meetings of the Board of Directors were held. The details of the meetings are furnished in the Annual Report disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which is attached to this Report (Please refer Page No. 52).
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and made judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended March 31, 2018.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY
A brief description about the Companyâs Nomination and Remuneration Policy on directorsâ appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other related matters provided in Section 178(3) of the Act are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. (Please refer Page Nos. 52 & 53).
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 1 86 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient is enclosed vide Annexure - II.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on armâs length basis and in the ordinary course of business. There was no material related party contract as defined under the Companies Act, 2013 during the year. Form AOC-2 as required under Section 134 (3)(h) of the Act is enclosed as Annexure - III to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Act read with Companies (Accounts) Rules, 2014 is enclosed as Annexure - IV.
RISK MANAGEMENT
The Company manages its risks through continuous review of business parameters on a regular basis by the management. Insurable risks are analysed and insurance policies are taken to protect the companyâs interests. The Audit Committee is also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The Company has undertaken activities as per the CSR Policy (available on the Companyâs website http://www.sundram.com/investors.php) and the Annual report on CSR activities is enclosed vide Annexure - V forming part of this report.
BOARD EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report attached as Annexure to this report.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
The Company has 6 Domestic Subsidiaries and 5 Overseas Subsidiaries. The financial performance of some of the subsidiaries during financial year 2017-18 are given hereunder:-
Sundram Fasteners (Zhejiang) Limited, China (SFZL, China) and Cramlington Precision Forge Limited, United Kingdom (CPFL, UK) are step-down overseas subsidiaries of the Company. The principal activity of CPFL, UK is manufacture of precision forgings and that of SFZL, China is manufacture of fasteners and bearing housing. SFZL, China has recently set-up a foundry division to enable backward integration for the above products.
The revenue from operations from CPFL, UK during the year under review was at Rs.8,217.48 lakhs as against Rs.6,901.47 lakhs in the previous year. The net profit / (loss) was at â (458.72) lakhs as against Rs.148.15 lakhs in the previous year.
The revenue from operations from SFZL, China during the year under review was at Rs.18,774.99 lakhs as against Rs.13,350.36 lakhs in the previous year. The net profit was at Rs.1,331.43 lakhs as against Rs.740.12 lakhs in the previous year.
TVS Upasana Limited is a wholly-owned subsidiary and is engaged in the manufacture of Spokes and Nipples, automobile kits, tools, dowel pins, small screws, Cold Extruded Parts and other parts catering to automotive industry. The revenue from operations from TVS Upasana Limited during the year under review was at Rs.15,541.16 lakhs as against Rs.14,793.60 lakhs in the previous year. The net profit was at Rs.1,744.50 lakhs as against Rs.1,106.97 lakhs in the previous year.
Sundram Precision Components Limited (SPCL), a wholly- owned subsidiary is engaged in the manufacture of parts for motor vehicle, sintered parts such as valve guides, valve seats and other parts catering to automotive industry. The revenue from operations from SPCL during the year under review was at Rs.2,645.32 lakhs as against Rs.2,368.94 lakhs in the previous year. The net profit was at Rs.193.00 lakhs as against Rs.253.51 lakhs in the previous year. The Board of Directors at their meeting held on May 24, 2017 had approved the scheme of amalgamation of Sundram Precision Components Limited with the Company and the relevant process is in preliminary stage.
TVS Infotech Limited (TVSi), a subsidiary is engaged in information technology business providing Enterprise Solutions for core industries like Manufacturing, Automotive and Distribution and focuses on off-shore and outsourcing operations for clients in India and the U.S.A. The revenue from operations from TVSi during the year under review was at Rs.728.21 lakhs as against Rs.1,993.64 lakhs (sale of SAP business during the financial year 2016-17) in the previous year. The net profit was at Rs.15.49 lakhs as against Rs.14.04 lakhs in the previous year.
TVS Next Private Limited (TVSN) is a subsidiary of TVSi and a step-down subsidiary of the Company. TVSNâs focused efforts in targeting USA market and Indian Enterprise customers paid dividends in the form of increased revenues. The Company maintains a healthy sales pipeline in both USA and India. Improved utilisation of resources and relentless focus on cost control helped achieve higher profits this year. The revenue from operations from TVSN was at Rs.1,567.10 lakhs during the year under review as against Rs.986.55 lakhs in the previous year. The net profit / (loss) was at Rs.70.69 lakhs as against â (63.08) lakhs in the previous year.
Pursuant to the provisions of Section 1 29(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of the Companyâs subsidiaries, Associates and Joint Ventures in detail in Form AOC-1 is attached to the financial statements of the Company (Please refer Page No. 175).
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANYâS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
No Company has become or ceased to be Companyâs subsidiary, joint venture or associate company during the financial year 2017-2018.
PUBLIC DEPOSITS
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
REGULATORY / COURT ORDERS
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company has in-house internal audit team to observe the effective functioning of internal financial controls, ensuring adequacy with respect to financial statements and verify whether the financial transaction flow in the organisation is being done based on the approved policies of the Company. The internal auditor presents the internal audit report every quarter and management comments on the internal audit observations to the Audit Committee. The internal control mechanisms are in place for safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
APPOINTMENT AND REMUNERATION OF KEY MANAGERIAL PERSONNEL
The statement of particulars of Appointment and Remuneration of Key Managerial Personnel as per Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide Annexure VI forming part of this report.
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2017-2018. Secretarial Audit Report issued by Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed in Annexure VII forming part of this report and does not contain any qualification. The Board of Directors has appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2018-2019. Necessary consent has been received from them to act as Secretarial Auditors.
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s. B S R & Co. LLP, Chartered Accountants, Chennai, (Registration No. 101248 W / W- 100022 with the Institute of Chartered Accountants of India), were appointed as Statutory Auditors of the Company at the Fifty Fourth Annual General Meeting (AGM) of the Company for a consecutive period of five years commencing from the conclusion of the Fifty Fourth AGM (i.e., August 24, 2017).
COST AUDITOR
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Companies (Cost Records and Audit) Rules, 2014, as amended, the Board of Directors had appointed Sri P Raju Iyer, Practising Cost Accountant (Membership No.6987) as Cost Auditor for the financial year 2018-2019. The audit committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. One complaint was received and resolved during the calendar year 2017.
SECRETARIAL STANDARDS
The Institute of Company Secretaries of India has issued Secretarial Standards (Meetings of the Board and General Meetings) on various aspects of corporate law and practices. The Company has complied with each one of them.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
Pursuant to Sections 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has a Vigil Mechanism through a Whistle Blower Policy.
The details about the whistle blower policy are provided in the Annual Report Disclosures under Regulation 34 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
INDUSTRIAL RELATIONS
Industrial relations continued to remain congenial during the year. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
ACKNOWLEDGMENT
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited, a step down subsidiary. The Directors wish to thank One North East, the Regional Development Authority for Cramlington, United Kingdom for the continued support extended to the step down Subsidiary. The Directors wish to thank the Companyâs bankers, State Electricity Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the assistance rendered by them from time to time.
On behalf of the Board
May 9, 2018 SURESH KRISHNA
Chennai Chairman
Mar 31, 2017
The Directors are pleased to present the Fifty Fourth Annual Report together with the audited financial statements for the year ended 31st March 2017.
FINANCIAL HIGHLIGHTS (STANDALONE) Rs. lakhs
2016-17 |
2015-16 |
|
Revenue from Operations |
315,863.55 |
280,903.26 |
Other Income |
1,320.14 |
3,458.30 |
Total Revenue |
317,183.69 |
284,361.56 |
Total Expenditure |
261,140.09 |
242,470.69 |
Gross Profit before interest, depreciation and taxes |
56,043.60 |
41,890.87 |
Less: Interest |
3,030.85 |
2,002.47 |
Exchange Losses / (Gains) |
1,338.65 |
4,044.86 |
Depreciation |
8,976.99 |
9,174.19 |
Profit before Exceptional items and taxes |
42,697.11 |
26,669.35 |
Exceptional items |
(236.94) |
(4,559.96) |
Profit Before Tax |
42,460.17 |
22,109.39 |
Less: Provision for tax |
10,912.23 |
709.89 |
Profit after Tax |
31,547.94 |
21,399.50 |
Add: Balance brought forward |
19,828.12 |
20,813.09 |
Balance available for appropriation |
51,376.06 |
42,212.59 |
Appropriations |
||
Interim Dividends |
3,572.19 |
6,408.92 |
Tax on Interim Dividends |
721.83 |
975.55 |
Transfer to General Reserve |
25,000.00 |
15,000.00 |
Balance carried forward |
22,082.04 |
19,828.12 |
51,376.06 |
42,212.59 |
TRANSFER TO RESERVES
The Company has transferred Rs. 25,000 lakhs to general reserves.
DIVIDEND
The Board had earlier during the year, declared first interim dividend of Rs.1.70/- per equity share (170%) of face of Rs.1 each absorbing a sum of Rs.35.72 crores for the financial year 2016-2017 and the same was paid on 18th November, 2016. The Board is pleased to recommend a final dividend of Rs.2.80 per equity share (280%) of face value of Rs.1 each absorbing a sum of Rs.58.84 crores which, together with the interim dividend, aggregates to a total dividend of Rs.4.50 per equity share for 2016-2017.
CONSOLIDATED FINANCIAL STATEMENTS
The audited Consolidated Financial Statements of the Company also form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Company has placed separate audited accounts of its subsidiaries on its website www.sundram.com. The Company will make available the audited annual accounts and associated information of its subsidiaries, upon request by any of its shareholders.
DIRECTORS
Ms Arundathi Krishna, Deputy Managing Director (DIN: 00270935) of the Company is liable to retire by rotation at the ensuing Annual General Meeting (AGM), and being eligible, offers herself for re-appointment. Necessary resolution for her re-appointment is being placed for approval of the members at the AGM. The board, therefore, recommends her re-appointment as a Director of the Company. A brief resume of her and other relevant information have been furnished in the notice convening the AGM.
Sri Venu Srinivasan, Non-Executive Non-Independent Director, has resigned from the Board, effective 8th August, 2016.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER SUB-SECTION (7) OF SECTION 149
All the independent directors have submitted a declaration pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6).
EXTRACT OF ANNUAL RETURN
An extract of annual return in Form MGT-9 is annexed as Annexure - I and forms part of this report.
BOARD MEETINGS
The Company, in consultation with the Directors, prepares and circulates a tentative annual calendar for the meetings of the Board and its Committees in order to facilitate and assist the Directors to plan their schedules for the meetings.
There were four Board Meetings during the year ended 31st March, 2017, which were on 20th May, 2016, 9th August, 2016, 2nd November, 2016 and 2nd February, 2017.
COMMITTEES OF THE BOARD
The Board of Directors has the following Committees:
1. Audit Committee
2. Nomination and Remuneration Committee
3. Corporate Social Responsibility Committee
4. Stakeholders'' Relationship Committee
5. Finance Committee
6. Strategy Committee
The details of the Committees along with their composition, number of meetings and attendance at the meetings are provided in the Corporate Governance section of this Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting standards had been followed and there were no material departures.
b) they had selected appropriate accounting policies and applied them consistently, and madejudgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year ended 31st March 2017.
c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by the company and such internal financial controls are adequate and are operating effectively.
f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively.
NOMINATION AND REMUNERATION POLICY
(I) Criteria for Determining Qualifications, Positive Attributes & Independence of Director
1. Qualifications of Independent Director:
An independent director shall be a person of eminence, standing and knowledge with significant achievements in business, professions and/or public service or professional practice and desirable to have industry experience in which the company operates. An Independent director shall possess appropriate skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, operations or other disciplines related to the company''s business.
2. Positive attributes of Independent Directors:
Nomination and Remuneration Committee shall take into account the following positive attributes while recommending the appointment of independent director.
a) To demonstrate integrity, credibility, trustworthiness, ability to handle conflict constructively, and the willingness to address issues proactively.
b) Continuously update their knowledge and skills with the latest developments in the automobile industry, market conditions and applicable legal provisions.
c) Ability and willingness to devote sufficient time and attention to the Company''s business and discharge their responsibilities.
d) Ability to bring an independent judgment to the Board''s deliberations especially on issues of strategy, performance, risk management, key appointments and standards of conduct.
e) Ability to develop a good working relationship with other Board members and contribute to the Board''s working relationship with the senior management of the Company.
f) To act within their authority, assist in protecting the legitimate interests of the Company, its shareholders and employees
g) Assist the company in implementing the best corporate governance practices.
3. Independence of Independent Directors:
An Independent director should meet the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, concerning independence of directors as may be specified from time to time.
(II) Remuneration Policy for Directors, Key Managerial Personnel and other employees
A. NON-EXECUTIVE DIRECTORS
Sitting Fees
Non-executive Directors will be entitled to sitting fees for attending meetings of the Board and its Committees as may be decided by the Board from time to time within the limits prescribed under the Act. The sitting fees presently paid to the Non -Executive Director is Rs.50,000/- per meeting of the Board and Rs.20,000/- per meeting of any Committee of the Board or separate meeting of independent directors thereof.
Reimbursement of expenses
Non-executive Directors will be entitled to reimbursement of expenses incurred in connection with attending the Board meetings, Board Committee meetings, meeting of independent directors, general meetings and in relation to the business of the Company towards hotel accommodation, travelling and other out-of-pocket expenses.
B. MANAGING DIRECTOR, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES
The following will be the guiding factors with respect to remuneration to Managing Director(s), Key Managerial Personnel and other employees.
a) The objective of the policy is directed towards having a compensation philosophy and structure that will reward and retain talent.
b) The Remuneration to Managing Director shall take into account the Company''s overall performance, Managing Directors'' contribution for the same and trends in the industry in general, in a manner, which will ensure and support a high performance culture.
c) As the company does not have any stock options, such instruments do not form part of his remuneration package.
d) The remuneration and commission to be paid to the Managing Director shall be in accordance with the percentage / limits / conditions laid down in the Companies Act, 2013.
e) Remuneration to Key Managerial Personnel and Senior Management personnel will have a balance between fixed and incentive pay reflecting both short and long term performance objectives appropriate to the working of the Company and its goals and objectives. Such remuneration will generally comprise of fixed pay, performance pay, perquisites, provision of car and other work related benefits, Directors & Officers'' Liability Insurance Policy (D&O Policy)
f) The Remuneration to the key managerial personnel and other employees will be such as to ensure that the relationship of remuneration to performance is clear and meets appropriate performance benchmarks.
POLICY ON BOARD DIVERSITY
Pursuant to requirements under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Nomination and Remuneration Committee (NRC) has framed a Policy on Board diversity appropriate to the business requirements of the Company, which inter-alia specifies optimum combination of Executive Directors, Non -Executive Directors and Independent Directors, the recommendatory requirement for each of the directors to possess functional diversity and role of NRC to ensure that the Policy on Board diversity is considered while recommending the appointment of new directors on the Board of the Company.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient are provided in the standalone financial statement (Please refer to Note No.38 to the standalone financial statement).
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED TO IN SUBSECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All transactions with related parties were on arm''s length basis and in the ordinary course of business. There was no material related party contract during the year. Form AOC-2 as required under Section 134 (3)(h) is enclosed as Annexure - II to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134 of the Act read with Companies (Accounts) Rules, 2014 enclosed as Annexure - III.
RISK MANAGEMENT
The Company faces diverse risks in terms of slowdown in economy, input prices, reputation, interest rates, foreign exchange, information systems, etc. The auto component industry has been operating in a challenging environment due to uncertainties and demand fluctuations in the economy in general and in particular automotive industry. The Company manages its risks in the following manner:-
a) exercising prudence while incurring capital expenditure or outlays on new projects
b) entering into long term contracts with customers to underwrite the capacities created
c) determination of product prices after engineering studies
d) adoption of a diversified business model in terms of products, market segments, geography and customers to ensure that Company is able to withstand any instability in the entire business eco-system
e) judicious approach to proportionate sourcing of inputs from indigenous and overseas markets in order to take advantage of commodity prices and exchange rate movements
f) analyzing credit risks through market feedbacks
g) management of interest rate risks through a combination of loan products, tenor of financing and currency denomination
h) monitoring, reviewing and hedging foreign exchange risks in accordance with the risk management policy
All the above mentioned risks are managed through continuous review of business parameters on a regular basis by the management. Insurable risks are analyzed and insurance policies are taken to protect the company''s interests. The Board of Directors are also informed periodically of the risks and concerns. Corrective actions and mitigation measures are taken as and when needed.
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The Company has undertaken activities as per the CSR Policy (available on the Company''s website http:// www.sundram.com/investors.php and the Annual report on CSR activities is enclosed vide Annexure - IV forming part of this report.
BOARD EVALUATION
The Nomination and Remuneration Committee (NRC) has laid down the criteria for performance evaluation of independent directors and other directors, Board of Directors and Committees of the Board of Directors. The criteria for performance evaluation cover the areas relevant to their functioning as independent directors or other directors, member of Board or Committees of the Board.
Evaluation of all Board members is done by the Board, NRC and Independent Directors on an annual basis with specific focus on the performance and effective functioning of the Board and individual directors. During the year, the Board adopted a formal mechanism for evaluating its performance and as well as that of its Committees and individual directors, including the Chairman of the Board. The exercise was carried out through an evaluation process covering various aspects of the Boards'' functioning such as composition of the Board and committees, frequency of meetings, administration of meeting, flow of information to the board, experience and competencies, performance of specific duties and obligations, disclosure of information to stakeholders, etc. Separate exercise was carried out to evaluate the performance of individual directors including the Chairman who were evaluated on parameters such as attendance, contribution at the meetings and independent judgement. The directors were satisfied with the evaluation results, which reflected the overall engagement of the Board and its Committees with the Company.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE
Report on the performance and financial position of each of the subsidiaries of the Company is given along with Financial Statement in Form AOC-1 (Please refer page no. 134).
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANY''S SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
TVS Infotech Limited (TVSi), a subsidiary of Sundram Fasteners Limited (SFL), has acquired 90% of the equity share capital of Blisslogix Technology Solutions Private Limited (BTS) on April 11, 2016. In view of the above, the name of the Company - BTS has been changed to TVS Next Private Limited. With this acquisition, TVS Next Private Limited has become a subsidiary of TVSi and a step down subsidiary of SFL.
The Company, by way of subscription to rights offer, has subscribed to 30,50,885 equity shares of TVS Infotech Limited (TVSi), a subsidiary, on April 11, 2016. With this acquisition, Sundram Fasteners Limited has 54.61% equity stake in TVSi and it has thus become a direct subsidiary of the Company.
In view of the cessation of Company''s Joint Venture with Bleistahl Produktions GmbH & Co. KG, Germany (Bleistahl) through its subsidiary company, Sundram Precision Components Limited (SPCL), the Company has acquired 16,80,000 equity shares (24%) of Rs.10/- each from Bleistahl, in the share capital of SPCL, on 27th March, 2017. With this acquisition, our Company has 100% equity stake in SPCL (prior to acquisition, the Company was holding 76%) and SPCL has thus become a wholly owned subsidiary of the Company.
Except for the details given above, no other company has become or ceased from being Company''s subsidiary, joint venture or associate company during the financial year.
PUBLIC DEPOSITS
During the year, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014. No amount on account of principal or interest on deposits from public was outstanding as on Balance Sheet date.
REGULATORY / COURT ORDERS
No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status of the Company and its future operations.
INTERNAL FINANCIAL CONTROLS OF THE COMPANY
The Company maintains all its financial records in Systems, Applications and Products (SAP) System and all financial transaction flow and approvals are routed through SAP. The Company''s Internal Audit team reviews the effective functioning of internal financial controls, ensuring adequacy with respect to financial statements and verify whether the financial transaction flow in the organization is being done based on the approved policies of the Company. During every quarter, internal auditor presents the internal audit report and management comments on the internal audit observations to the Audit Committee. Further, the Board of Directors of the Company have adopted various policies like Related Party Transactions Policy, Whistle Blower Policy, Material Subsidiary Policy for ensuring the orderly and efficient conduct of its business for safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information.
APPOINTMENT AND REMUNERATION OF KEY MANAGERIAL PERSONNEL
The statement of particulars of Appointment and Remuneration of Key Managerial Personnel as per Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide Annexure V forming part of this report.
STATEMENT ON EMPLOYEES REMUNERATION
Pursuant to Section 136 (1) of the Companies Act, 2013, the report of the Board of Directors is being sent to all the shareholders of the Company excluding the statement prescribed under Rule 5 of the Companies (Appointment and Remuneration) Rules, 2014. The statement is available for inspection by the shareholders at the Registered Office of the Company during business hours.
SECRETARIAL AUDITORS
The Board of Directors has appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2017-2018. Necessary consent has been received from them to act as Secretarial Auditors.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013, the Board of Directors had appointed M/s. S Krishnamurthy & Co., Company Secretaries, Chennai as the Secretarial Auditor of the Company for the financial year 2016-2017. Secretarial Audit Report issued by Sri K Sriram, Practicing Company Secretary (CP No.2215), Partner, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is enclosed in Annexure VI forming part of this report and does not contain any qualification.
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s Sundaram & Srinivasan, Chartered Accountants, Chennai were appointed as Statutory Auditors of the Company at the 51st Annual General Meeting held on 22nd September, 2014 for a consecutive period of three years, upto the conclusion of the 54th Annual General Meeting.
In terms of third proviso under Section 139(2) of the Companies Act, 2013, the tenure of the incumbent Auditors ceases upon the conclusion of ensuing Annual General Meeting.
The Board of Directors place on record their sincere appreciation of the valuable services rendered by M/s Sundaram & Srinivasan, Chartered Accountants, Chennai since inception of the Company as statutory auditors of the Company.
The Board of Directors have recommended the appointment of B S R & Co. LLP, Chartered Accountants, Chennai as the statutory auditors of the Company, for a term of five consecutive years, till the conclusion of the Annual General Meeting of the Company for the financial year 2021-2022. The Company has received consent from B S R & Co. LLP, Chartered Accountants, Chennai to serve as statutory auditors of the Company, if they are so appointed.
They have also furnished necessary certificate required under the Companies Act, 2013 conveying their eligibility for appointment.
A brief profile of the auditor is given below:-
B S R & Co. (''the firm'') was constituted on 27th March, 1990 having firm registration no. as 101248W. It was converted into limited liability partnership i.e. B S R & Co. LLP on 14th October, 2013 thereby having a new firm registration no. 101248W / W-100022. The registered office of the firm is at 5th Floor, Lodha Excelus, Apollo Mills Compound, N. M. Joshi Marg, Mahalaxmi, Mumbai, Maharashtra - 400 011 .
B S R & Co. LLP is a member entity of B S R & Affiliates, a network registered with the Institute of Chartered Accountants of India. The other entities which are part of the B S R & Affiliates include B S R & Associates LLP, B S R & Company, B S R and Co, B S R and Associates, B S R and Company, B S R R & Co, B S S R & Co and B B S R & Co.
B S R & Co. LLP is registered in Mumbai, Gurgaon, Bangalore, Kolkata, Hyderabad, Pune, Chennai, Chandigarh, Ahmedabad, Vadodara, Noida, Jaipur and Kochi.
COST AUDITOR
In terms of Section 148 of the Companies Act, 2013 (the Act) read with Companies (Cost records and audits) Rules, 2014, as amended, the Board of Directors had appointed Sri P Raju Iyer, Practicing Cost Accountant (Membership No.6987) as Cost Auditor for the financial year 2017-2018. The audit committee recommended his appointment and remuneration subject to the compliance of all the requirements as stipulated under the Act and circulars issued thereunder.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the SFL''s Policy on Sexual Harassment of Women at the Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) of the Company has been constituted to redress complaints regarding sexual harassment. One complaint was received and resolved during the year 2016.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The Company has a Vigil Mechanism through a Whistle Blower Policy. The policy enables stakeholders, including individual employees and their representative bodies, to freely communicate their concerns about illegal or unethical practices, if any, reporting of concerns by directors and employees about unethical behaviour, actual or suspected fraud or violation of the company''s code of conduct or ethics policy or any other genuine concerns or grievances. It also provides for adequate safeguards against victimization of employees and directors who avail of the vigil mechanism and also provide for direct access to the Chairman of the audit committee. No communication from any employee of the company under the whistle blower policy was received during the year.
INDUSTRIAL RELATIONS
Industrial relations continued to remain congenial during the year. The Directors thank the employees for their contribution to the progress of the Company during the year under review.
ACKNOWLEDGMENT
The Directors wish to thank the Chinese Authorities, Officers of Haiyan County, Jiaxin City, Zhejiang province, Chinese tax and other administrative authorities for the support extended to Sundram Fasteners (Zhejiang) Limited. The Directors wish to thank One North East, the Regional Development Authority for Cramlington, United Kingdom for the continued support extended to the step down Subsidiary. The Directors wish to thank the Company''s bankers, State Electricity Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand, customers and vendors, employees for all the assistance rendered by them from time to time.
On behalf of the Board
Chennai SURESH KRISHNA
24th May, 2017 Chairman and Managing Director
Mar 31, 2015
Dear Members,
The Directors are pleased to present the Fifty second Annual Report
together with the audited financial statements for the year ended 31st
March 2015.
FINANCIAL RESULTS Rs. lakhs
2014-15 2013-14
Revenue from Operations 238,576.58 202,227.62
Other Income 2,335.50 4,871.94
Total Revenue 240,912.08 207,099.56
Total expenditure 205,233.41 176,616.03
Gross Profit before interest,
depreciation and taxes 35,678.67 30,483.53
Less: Interest 2,137.81 3,074.08
Exchange Losses / (Gains) 6,000.79 2,783.42
Depreciation 8,831.50 7,636.73
Profit before Exceptional items and taxes 18,708.57 16,989.30
Exceptional items (1,000.00) (1,000.00)
Profit Before Tax 17,708.57 15,989.30
Less: Provision for tax 4,176.33 3,900.07
Profit after Tax 13,532.24 12,089.23
Add: Balance brought forward 7,958.04 7,352.56
Balance available for appropriation 21,490.28 19,441.79
Appropriations
Interim Dividends 3,677.25 3,572.18
Tax on Interim Dividends 494.98 411.57
Transfer to General Reserve - 7,500.00
Balance carried forward 17,318.05 7,958.04
21,490.28 19,441.79
TRANSFER TO RESERVES
The Company does not propose to transfer any amount to the general
reserve for the financial year ended on 31st March, 2015.
DIVIDEND
The Directors have decided to pay a Second Interim Dividend of Rs. 0.90
per share of face value of Rs. 1 each out of the surplus in profit and
loss account, which together with the interim dividend of Re 0.85
declared and paid earlier, would amount to a total dividend for the
year of Rs. 1.75 per share of Rs. 1 each. Dividend disbursed amounts to Rs.
4,172.23 lakhs inclusive of dividend distribution tax. Second interim
dividend will absorb a total amount of Rs. 2,039.55 lakhs. The Directors
do not recommend any final dividend.
CONSOLIDATED FINANCIAL STATEMENTS
The audited Consolidated Financial Statements of the Company and its
subsidiaries also form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013,
the Company has placed separate audited accounts of its subsidiaries on
its website www.sundram.com. The Company will make available the
audited annual accounts and related information of its subsidiaries,
upon request by any of its shareholders.
CORPORATE GOVERNANCE
A separate report on Corporate Governance together with a certificate
from the Company's auditors confirming the compliance of conditions of
Corporate Governance is attached to this report. Management Discussion
and Analysis detailing the state of the company's affairs is also
attached to this report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The existing composition of the company's Board is fully in conformity
with the applicable provisions of the Companies Act, 2013 and Clause 49
of the Listing Agreement with regard to independent directors and women
directors.
Sri B Muthuraman was appointed as a non-executive independent director
not liable to retire by rotation for a period of five consecutive years
from 16th April, 2015 to 15th April, 2020, through Postal Ballot
process.
Sri Venu Srinivasan, Director of the company is liable to retire by
rotation at the ensuing AGM, and being eligible, offers himself for
re-appointment. Necessary resolution for his re-appointment is being
placed for approval of the members at the AGM. The board, therefore,
recommends his re-appointment as a director of the company. A brief
resume of him and other relevant information have been furnished in the
notice convening the AGM.
In terms of Section 203 of the Companies Act, 2013, Sri Suresh Krishna,
Chairman and Managing Director, Ms Arathi Krishna, Joint Managing
Director, Ms Arundathi Krishna, Deputy Managing Director and Sri V G
Jaganathan, Chief Financial Officer & Company Secretary were recognised
as Key Managerial Personnel at the Board Meeting held on 30th May,
2014.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS UNDER
SUB-SECTION (6) OF SECTION 149
All the independent directors have submitted a declaration as required
pursuant to Section 149(7) of the Companies Act, 2013 stating that they
meet the criteria of independence as stipulated in Section 149(6).
EXTRACT OF ANNUAL RETURN
An extract of annual return in Form MGT-9 is annexed herewith as
Annexure - I.
BOARD MEETINGS
The Company, in consultation with the Directors, prepares and
circulates a tentative annual calendar for the meetings of the Board
and Board Committees in order to facilitate and assist the Directors to
plan their schedules for the meetings.
There were four Board Meetings during the year ended 31st March 2015,
which were on 30th May 2014, 7th August 2014, 6th November 2014 and 4th
February 2015.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that:
a) in the preparation of annual accounts, the applicable accounting
standards had been followed.
b) they had selected appropriate accounting policies and applied them
consistently, and made judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for 31st March 2015.
c) they had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 2013 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities.
d) they had prepared the annual accounts on a going concern basis.
e) they had laid down the internal financial controls to be followed by
the company and such internal financial controls are adequate and are
operating effectively.
f) they had devised proper systems to ensure compliance with the
provisions of all applicable laws and such systems were adequate and
operating effectively.
NOMINATION AND REMUNERATION POLICY
(I) Criteria for Determining Qualifications, Positive Attributes &
Independence of Director
1. Qualifications of Independent Director:
An independent director shall be a person of eminence, standing and
knowledge with significant achievements in business, professions and/or
public service or professional practice and desirable to have industry
experience in which the company operates. An Independent director shall
possess appropriate skills, experience and knowledge in one or more
fields of finance, law, management, sales, marketing, administration,
research, corporate governance, operations or other disciplines related
to the company's business.
2. Positive attributes of Independent Directors:
Nomination and Remuneration Committee shall take into account the
following positive attributes while recommending the appointment of
independent director.
a) To demonstrate integrity, credibility, trustworthiness, ability to
handle conflict constructively, and the willingness to address issues
proactively.
b) Continuously update their knowledge and skills with the latest
developments in the automobile industry, market conditions and
applicable legal provisions.
c) Ability and willingness to devote sufficient time and attention to
the Company's business and discharge their responsibilities.
d) Ability to bring an independent judgment to the Board's
deliberations especially on issues of strategy, performance, risk
management, key appointments and standards of conduct.
e) Ability to develop a good working relationship with other Board
members and contribute to the Board's working relationship with the
senior management of the Company.
f) To act within their authority, assist in protecting the legitimate
interests of the Company, its shareholders and employees
g) Assist the company in implementing the best corporate governance
practices.
3. Independence of Independent Directors:
An Independent director should meet the requirements of the Companies
Act, 2013 and Clause 49 of the Listing Agreement concerning
independence of directors as may be specified from time to time.
(II) Remuneration Policy for Directors, Key Managerial Personnel and
other employees
A. NON-EXECUTIVE DIRECTORS
Sitting Fees
Non-executive Directors will be entitled to sitting fees for attending
meetings of the Board and its Committees as may be decided by the Board
from time to time within the limits prescribed under the Act. The
sitting fees presently paid to the Non-Executive Independent Director
is Rs. 50,000/- per meeting of the Board and Rs. 20,000/- per meeting of
any Committee of the Board or separate meeting of independent directors
thereof.
Reimbursement of expenses
Non-executive Directors will be entitled to reimbursement of expenses
incurred in connection with attending the Board meetings, Board
Committee meetings, meeting of independent directors, general meetings
and in relation to the business of the Company towards hotel
accommodation, travelling and other out-of-pocket expenses.
B. MANAGING DIRECTOR, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES
The following will be the guiding factors with respect to remuneration
to Managing Director(s), Key Managerial Personnel and other employees.
a) The objective of the policy is directed towards having a
compensation philosophy and structure that will reward and retain
talent.
b) The Remuneration to Managing Director shall take into account the
Company's overall performance, Managing Directors' contribution for the
same and trends in the industry in general, in a manner which will
ensure and support a high performance culture.
c) As the company does not have any stock options such instruments do
not form part of his remuneration package.
d) The remuneration and commission to be paid to the Managing Director
shall be in accordance with the percentage / limits / conditions laid
down in the Companies Act, 2013.
e) Remuneration to Key Managerial Personnel and Senior Management
personnel will have a balance between fixed and incentive pay
reflecting both short and long term performance objectives appropriate
to the working of the Company and its goals and objectives. Such
remuneration will generally comprise of fixed pay, performance pay,
perquisites, provision of car and other work related benefits,
Directors & Officers' Liability Insurance Policy (D&O Policy)
f) The Remuneration to the key managerial personnel and other employees
will be such as to ensure that the relationship of remuneration to
performance is clear and meets appropriate performance benchmarks.
POLICY ON BOARD DIVERSITY
In terms of Clause 49(IV) of the Listing agreement, the Nomination and
Remuneration Committee has framed a Policy on Board diversity
appropriate to the business requirements of the Company, which
inter-alia specifies optimum combination of Executive Directors,
Non-Executive Directors and Independent Directors, the recommendatory
requirement for each of the directors to possess functional diversity
and role of NRC to ensure that the Policy on Board diversity is
considered while recommending the appointment of new directors on the
Board of the company.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF
THE COMPANIES ACT, 2013
Particulars of loans given, investments made, guarantees given and
securities provided along with the purpose for which the loan or
guarantee or security is proposed to be utilised by the recipient are
provided in the standalone financial statement (Please refer to Note 9,
10 & 18 and 29 under Note 31 to the standalone financial statement).
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES (REFERRED
TO IN SUB-SECTION (1) OF SECTION 188 OF THE COMPANIES ACT, 2013)
All contracts arrangements / transactions with related parties are on
arms' length basis and in the ordinary course of business. There was no
material related party contracts during the year on an arms' length
basis. Form AOC-2 as required under Section 134 (3)(h) is enclosed as
Annexure - II to this report.
MATERIAL CHANGES AND COMMITMENTS
There were 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 the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information with respect to conservation of energy, technology
absorption, foreign exchange earnings and outgo pursuant to Section 134
of the Act read with Companies (Accounts) Rules, 2014 enclosed as
Annexure - III.
RISK MANAGEMENT
The Company faces diverse risks in terms of downturn in economy, input
prices, reputation, interest rates, foreign exchange, information
systems, etc. The auto component industry has been operating in a
challenging environment due to weakness in the economy in general and
in particular automotive industry. The Company manages its risks in the
following manner:- a) exercising prudence while incurring capital
expenditure or outlays on new projects
b) entering into long term contracts with customers to underwrite the
capacities created
c) determination of product prices after engineering studies
d) adoption of a diversified business model in terms of products,
market segments, geography and customers to ensure that Company is able
to withstand any instability in the entire business eco-system
e) judicious approach to proportionate sourcing of inputs from
indigenous and overseas markets in order to take advantage of commodity
prices and exchange rate movements
f) analysing credit risks through market feedbacks
g) management of interest rate risks through a combination of loan
products, tenor of financing and currency denomination
h) monitoring, reviewing and hedging foreign exchange risks in
accordance with the risk management policy
All the aforesaid risks are managed through continuous review of
business parameters on a regular basis by the management. Insurable
risks are analysed and insurance policies are taken to protect the
company's interests. The Board of Directors are also informed
periodically of the risks and concerns. Corrective actions and
mitigation measures are taken as and when needed.
CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY AND IMPLEMENTATION
The Company has undertaken activities as per the CSR Policy (available
on the Company's website http://www.sundram.com/investors.php and the
Annual report on CSR activities is enclosed vide Annexure - IV forming
part of this report.
BOARD EVALUATION
The Nomination and Remuneration Committee (NRC) has laid down the
criteria for performance evaluation of independent directors and other
directors, Board of Directors and Committees of the Board of Directors.
The criteria for performance evaluation cover the areas relevant to
their functioning as independent directors or other directors, member
of Board or Committees of the Board.
Evaluation of all Board members is done by the Board, NRC and
Independent Directors on an annual basis with specific focus on the
performance and effective functioning of the Board and individual
directors. During the year, the Board adopted a formal mechanism for
evaluating its performance and as well as that of its Committees and
individual directors, including the Chairman of the Board. The exercise
was carried out through an evaluation process covering various aspects
of the Boards' functioning such as composition of the Board and
committees, frequency of meetings, administration of meeting, flow of
information to the board, experience and competencies, performance of
specific duties and obligations, disclosure of information to
stakeholders, etc. Separate exercise was carried out to evaluate the
performance of individual directors including the Chairman who were
evaluated on parameters such as attendance, contribution at the
meetings and independent judgement. The directors were satisfied with
the evaluation results, which reflected the overall engagement of the
Board and its Committees with the Company.
PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES,
ASSOCIATES AND JOINT VENTURE
Report on the performance and financial position of each of the
subsidiaries, associates and joint venture companies of the Company is
given along with Financial Statement in Form AOC-1.
CHANGE IN THE NATURE OF BUSINESS
There was no change in the nature of business of the Company during the
financial year.
NAMES OF COMPANIES WHICH HAVE BECOME OR CEASED TO BE COMPANY'S
SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
Sundram Fasteners Investments Limited (SFIL), a wholly-owned subsidiary
of the company was holding 49.93% of equity share capital of TVS
Infotech Limited. During the year, SFIL subscribed to additional equity
shares of TVS Infotech Limited (an associate company) and consequently
TVS Infotech Limited has become a subsidiary of SFIL. SFIL has 62.27%
equity stake in TVS Infotech Limited. Thus, TVS Infotech Limited has
become a subsidiary of SFIL, and consequently a step-down subsidiary of
the Company. TVS Infotech Limited holds 100% equity stake in TVS
Infotech Inc., Michigan, USA. Accordingly, TVS Infotech Inc., Michigan,
USA has also become a step-down subsidiary of SFIL and of the company.
TVS Infotech Limited (an unlisted company) is engaged in information
technology business providing enterprise solutions for core industries
like manufacturing, automotive and distribution.
Sundram RBI Sdn. Bhd., Malaysia (wholly owned subsidiary) has ceased
operations during the year.
The Board of Directors of Sundram International Inc. (wholly owned
subsidiary) has approved a plan for discontinuance of its operations.
Except for the details given above, no other company has become or
ceased to be Company's subsidiary, joint venture or associate company
during the financial year.
PUBLIC DEPOSITS
During the year, the Company has not accepted any deposits, within the
meaning of Section 73 of the Companies Act, 2013 read with Companies
(Acceptance of Deposits) Rules, 2014. No amount on account of principal
or interest on deposits from public was outstanding as on Balance Sheet
date.
REGULATORY / COURT ORDERS
During the year 2014-2015, no significant and material orders were
passed by the regulators or courts or tribunals impacting the going
concern status and company's operations in future.
INTERNAL FINANCIAL CONTROLS
The Company maintains all its financial records in SAP System and all
financial transaction flow and approvals are routed through SAP. The
Company has in-house internal audit team to observe the effective
functioning of internal financial controls and check whether the
financial transaction flow in the organisation is being done based on
the approved policies of the Company. During every quarter, internal
auditor presents the internal audit report and management comments on
the internal audit observations. Further, the Board of Directors of the
Company have adopted various policies like Related Party Transactions
Policy, Whistle Blower Policy, Material Subsidiary Policy for ensuring
the orderly and efficient conduct of its business for safeguarding of
its assets, the prevention and detection of frauds and errors, the
accuracy and completeness of the accounting records and timely
preparation of reliable financial information.
APPOINTMENT AND REMUNERATION OF KEY MANAGERIAL PERSONNEL
The statement of particulars of Appointment and Remuneration of Key
Managerial Personnel as per Rule 5 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is enclosed vide
Annexure V forming part of this report.
STATEMENT UNDER RULE 5 (2) AND (3) OF THE COMPANIES APPOINTMENT AND
REMUNERATION RULES, 2014
In terms of first proviso to Section 136 (1) of the Companies Act,
2013, the report of the Board of Directors is being sent to all the
shareholders of the Company excluding the statement prescribed under
Rule 5 (2) and (3) of the Companies (Appointment and Remuneration)
Rules, 2014. The statement is available for inspection by the
shareholders at the Registered Office of the Company during business
hours, till the conclusion of Annual General Meeting.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013
the Board of Directors have appointed M/s. S Krishnamurthy & Co.,
Company Secretaries, Chennai as the Secretarial Auditor of the Company
for the financial year 2014-2015. Secretarial Audit Report issued by
Sri K Sriram, Practising Company Secretary (CP No.2215), Partner, M/s.
S Krishnamurthy & Co., Company Secretaries, Chennai in Form MR-3 is
enclosed vide Annexure VI and forms part of this report.
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s Sundaram &
Srinivasan, Chartered Accountants, Chennai,(Registration No. 004207S
with the Institute of Chartered Accountants of India), were appointed
as Auditors of the Company at the fifty first annual general meeting of
the company for a consecutive period of three years commencing from
22nd September, 2014. The Company has received a certificate from the
statutory auditors to the effect that ratification of their
appointment, if made, would be in compliance with the requirements of
the Companies Act, 2013 and the rules made thereunder. Accordingly, the
Board of Directors propose to ratify their appointment as Auditors of
the Company for the second consecutive year (within the term of three
consecutive years approved by the shareholders at the Fifty First
Annual General Meeting held on 22nd September, 2014).
COST AUDITOR
In terms of Section 148 of the Companies Act, 2013 (the Act) read with
Companies (Cost records and audits) Rules, 2014, as amended, the Board
of Directors had appointed Sri P Raju Iyer, Practising Cost Accountant
(Membership No.6987) as Cost Auditor for the financial year 2015-2016.
The audit committee recommended his appointment and remuneration
subject to the compliance of all the requirements as stipulated under
the Act and circulars issued thereunder. The Company has also received
necessary certificate under Section 141 of the Act conveying his
eligibility for re-appointment. The remuneration fixed by the board,
based on the recommendation of the audit committee is required to be
ratified by the members at the AGM as per the requirement of Section
148(3) of the Act.
AUDIT COMMITTEE
The Audit Committee consists of Sri R Srinivasan, Sri V Narayanan and
Sri R Ramakrishnan, all non-executive independent Directors of the
Company, with Sri R Srinivasan as its Chairman.
The Audit Committee met four times during the year on 30th May 2014,
7th August 2014, 6th November, 2014 and 4th February, 2015. All the
members attended the meeting.
The role and terms of reference of Audit Committee cover the matters
specified for Audit Committees under Clause 49 of the Listing Agreement
as well as in Section 177 of the Companies Act, 2013.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has adopted the Anti-Sexual Harassment Policy in line with
the requirements of the Sexual Harassment of Women at the Workplace
(Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints
Committee (ICC) of the Company has been constituted to redress
complaints regarding sexual harassment. No complaint was received
during the year.
WHISTLE BLOWER POLICY (VIGIL MECHANISM)
The Board of Directors of the Company has formulated an effective
Whistle Blower Policy (Vigil Mechanism) enabling stakeholders,
including individual employees and their representative bodies, to
freely communicate their concerns about illegal or unethical practices,
if any, reporting of concerns by directors and employees about
unethical behaviour, actual or suspected fraud or violation of the
company's code of conduct or ethics policy or any other genuine
concerns or grievances, to provide for adequate safeguards against
victimisation of employees and directors who avail of the vigil
mechanism and also provide for direct access to the Chairman of the
audit committee. No communication from any employee of the company
under the whistle blower policy was received during the year.
DELISTING OF SHARES FROM MADRAS STOCK EXCHANGE
Consequent to voluntary de-recognition of Madras Stock Exchange Limited
(MSE) in terms of the circular dated 30th May 2012 issued by Securities
and Exchange Board of India and in furtherance to the Company's
application for voluntary delisting of equity shares from MSE, MSE on
29th December, 2014, had informed that the equity shares of the Company
have been delisted from their exchange with effect from that date.
INDUSTRIAL RELATIONS
Industrial relations continued to remain congenial during the current
year. The Directors thank the employees for their contribution to the
progress of the Company.
ACKNOWLEDGMENT
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited. The Directors wish to thank One North
East, the Regional Development Authority for Cramlington, United
Kingdom for the continued support extended to the Subsidiary. The
Directors wish to thank the Company's bankers, State Electricity Boards
in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand, customers
and vendors, employees for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 29, 2015 Chairman and Managing Director
Mar 31, 2014
REPORT OF THE DIRECTORS TO THE SHAREHOLDERS
The Directors are pleased to present the Fifty first Annual Report
together with the audited accounts for the year ended 31st March 2014.
FINANCIAL RESULTS Rs lakhs
2013-14 2012-13
Revenue from Operations 202,227.62 206,941.67
Other Income 4,871.94 2,630.12
Total Revenue 207,099.56 209,571.79
Gross Profit before interest, depreciation and
taxes 30,483.53 28,363.33
Less : Interest ` 3,074.08 4,108.75
Exchange Losses / (Gains) 2,783.42 4,026.54
Depreciation 7,636.73 7,161.54
Profit before Exceptional Items
and taxes 16,989.30 13,066.50
Exceptional items (1,000.00) 127.80
Profit Before Tax 15,989.30 13,194.30
Less: Provision for tax 3,900.07 3,688.05
Profit after tax 12,089.23 9,506.25
Add: Balance brought forward 7,352.56 6,269.74
Balance available for appropriation 19,441.79 15,775.99
Appropriations
Interim Dividends 3,572.18 2,941.80
Tax on Interim Dividends 411.57 481.63
Transfer to General Reserve 7,500.00 5,000.00
Balance carried forward 7,958.04 7,352.56
19,441.79 15,775.99
SALES & PROFITS
The Company recorded total Net Sales and other income of Rs 2071.00
Crores for the year ended March 31, 2014 as against Rs 2095.72 Crores
achieved during the previous year. The export sale was at Rs 760.75
Crores as against Rs 678.25 Crores in the previous year. The Profit
after tax was at Rs 120.89 Crores as against Rs 95.06 Crores in the
previous year. The Company continues to be a net foreign exchange
earner for the seventeenth year in succession.
DIVIDEND
The Directors have decided to pay as Second Interim Dividend of Re 1.00
per Share of face value of Re 1 each, which together with the Interim
Dividend of Re 0.70 declared and paid earlier would amount to a total
dividend for the year of Rs 1.70 per share of Re 1 each. Dividend
disbursed amounted to Rs 1,470.90 lakhs. Second Interim Dividend will
absorb a total amount of Rs 2,101.28 lakhs. The Directors do not
recommend any final dividend.
CONSOLIDATED FINANCIAL STATEMENTS / STATUTORY STATEMENTS
As required by Accounting Standard - AS 21 on Consolidated Financial
Statements, the audited Consolidated Financial Statements of the
Company and its Subsidiaries are attached.
As per Section 212 of the Companies Act, 1956, the Company is required
to attach the Directors'' Report, Balance Sheet and Profit and Loss
account of subsidiaries. The Central Government has granted general
exemption from complying with Section 212 of the Companies Act, 1956 to
all companies vide Notification No.5/12/ 2007-CL-III dated February 8,
2011. Accordingly, the Company has presented in this Report, the
consolidated financial statements of the holding Company and all its
subsidiaries, duly audited by the Statutory Auditors. The Company has
also disclosed in the Consolidated Balance Sheet the information
required to be provided as per
the aforesaid notification dated February 8, 2011. The Company will
make available the audited annual accounts and related information of
its subsidiaries, upon request by any of its shareholders. The annual
accounts of the subsidiary companies will also be kept for inspection,
by any member at the Registered Office of the Company and its
subsidiary companies.
The Company has not accepted any deposits, within the meaning of
Section 58-A of the Companies Act, 1956 read with the Companies
(Acceptance of Deposits) Rules, 1975 made thereunder.
The information 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 is given in the Annexure to this
report.
The information required under the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules 1988, is given in the
Annexure appended hereto and forms part of this report. In terms of
Section 219(1)(b)(iv) of the Act, the Report and Accounts are being
sent to the Members excluding the aforesaid Annexure. Interested
Members may write to the Company Secretary, at the Registered Office of
the Company, for obtaining a copy of the said Annexure.
CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a certificate from the Company''s Auditors
confirming the compliance of conditions of Corporate Governance is
attached to this report.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that :
1) in the preparation of annual accounts, the applicable accounting
standards have been followed.
2) appropriate accounting policies have been selected and applied
consistently, and judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for that period.
3) proper and sufficient care has been taken 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.
4) the annual accounts have been prepared on a going concern basis.
DIRECTORS
During the year, the Ministry of Corporate Affairs (MCA) has notified
majority of the provisions inter alia provisions relating to selection,
manner of appointment, roles, functions, duties, re-appointment of
independent directors and the relevant rules under the Companies Act,
2013 (the Act 2013) and made them effective 1st April 2014. The
existing composition of the company''s board is fully in conformity with
the applicable provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement having the following directors as non-executive
independent directors, namely Sri V Narayanan, Sri R Srinivasan, Sri R
Ramakrishnan, Sri C V Karthik Narayanan, and Sri M Raghupathy.
In terms of Section 149(10) read with Section 149(5) of the Companies
Act, 2013 it is proposed to appoint them as independent directors for
the respective periods specified in the notice of the annual general
meeting.
In terms of the provisions of sub-section (6) read with explanation to
Section 152 of the Companies Act, 2013, two-third of the total number
of directors i.e. excluding independent directors, are liable to retire
by rotation and out of which, one-third is liable to retire by rotation
at every annual general meeting. Accordingly, Ms Arathi Krishna,
Director of the company, becomes liable to retire by rotation, at the
ensuing AGM, and being eligible, offers herself for re-appointment.
The brief resume of these directors proposed to be appointed and
re-appointed and other relevant information have been furnished in the
notice convening the AGM. Necessary resolutions for their appointment /
re-appointment are being placed for approval of the members at the AGM.
The board, therefore, recommends their appointment / re-appointment as
directors of the company.
AUDITORS STATUTORY AUDITOR
As per the provisions of Section 139(1) and (2) of the Companies Act,
2013 read with Rule 6(3) of the Companies (Audit and Auditors) Rules,
2014 M/s. Sundaram & Srinivasan, Chartered Accountants, Chennai (who
were earlier appointed as statutory auditors of the company, at the
annual general meeting held on 23rd August, 2013) are eligible to be
appointed for the period of three years, subject to ratification every
year in the Annual General Meeting.
The Company has obtained necessary certificate under Section 141 of the
Companies Act, 2013 from the auditor conveying their eligibility for
the above appointment. Their eligibility criteria were reviewed by the
audit committee and board, as specified under Section 141 of the
Companies Act, 2013 and recommended their appointment as auditors for
the above mentioned period.
SECRETARIAL AUDITOR
In terms of under Section 204 of the Companies Act, 2013 and Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company is required to appoint a Secretarial Auditor for auditing the
secretarial and related records of the company and to provide a report
in this regard.
Accordingly, M/s. S Krishnamurthy & Co., Company Secretaries, Chennai
have been appointed as Secretarial Auditor for carrying out the
secretarial audit for the financial year 2014-2015.
INDUSTRIAL RELATIONS
The industrial relations continued to remain congenial during the
current year. The Directors thank the employees for their contribution
to the progress of the Company.
GENERAL
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited. The Directors wish to thank One North
East, the Regional Development Authority for Cramlington, United
Kingdom for the continued support extended to the Subsidiary.
The Directors wish to thank the Company''s bankers, State Electricity
Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand,
customers and vendors, for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 30, 2014 Chairman & Managing Director
Mar 31, 2013
TO THE SHAREHOLDERS
The Directors are pleased to present the Fiftieth Annual Report
together with the audited accounts for the year ended 31st March 2013.
FINANCIAL RESULTS Rs lakhs
2012-13 2011-12
Revenue from Operations 206,941.67 214,663.52
Other Income 2,630.12 1,807.43
Total Revenue 209,571.79 216,470.95
Gross Profit before interest,
depreciation and taxes 28,363.33 31,315.75
Less : Interest 4,108.75 3,490.26
Exchange Losses/(Gains) 4,026.54 5,729.74
Depreciation 7,161.54 6,361.31
Profit before Exceptional Items and taxes 13,066.50 15,734.45
Exceptional items 127.80 -
Profit before tax 13,194.30 15,734.45
Less : Provision for tax 3,688.05 4,474.58
Profit after tax 9,506.25 11,259.87
Add : Balance brought forward 6,269.74 3,418.72
Balance available for appropriation 15,775.99 14,678.59
Appropriations
Interim Dividends 2,941.80 2,941.80
Tax on Interim Dividends 481.63 467.05
Transfer to General Reserve 5,000.00 5,000.00
Balance carried forward 7,352.56 6,269.74
15,775.99 14,678.59
SALES & PROFITS
The Company recorded total Net Sales and other income of Rs 2,095.72
Crores for the year ended March 31, 2013 as against Rs 2,164.71 Crores
achieved during the previous year. The export sale was at Rs 678.25
Crores as against Rs 645.88 Crores in the previous year. The Profit
after tax was at Rs 95.06 Crores as against Rs 112.60 Crores in the
previous year.
The Company continues to be a net foreign exchange earner for the
sixteenth year in succession.
DIVIDEND
The Directors have decided to pay a Second Interim Dividend of Re 0.80
per Share of face value of Re 1 each, which together with the Interim
Dividend of Re 0.60 declared and paid earlier would amount to a total
dividend for the year of Rs 1.40 per share of Re 1 each. Dividend
disbursed amounted to Rs 1,260.77 lakhs. Second Interim Dividend will
absorb a total amount of Rs 1,681.03 lakhs. The Directors do not
recommend any final dividend.
CONSOLIDATED FINANCIAL STATEMENTS / STATUTORY STATEMENTS
As required by Accounting Standard - AS 21 on Consolidated Financial
Statements, the audited Consolidated Financial Statements of the
Company and its Subsidiaries are attached.
As per Section 212 of the Companies Act, 1956, the Company is required
to attach the Directors'' Report, Balance Sheet and Statement of Profit
and Loss of subsidiaries. The Central Government has granted general
exemption from complying with Section 212 of the Companies Act, 1956 to
all companies vide Notification No.5/12/2007-CL-III dated February 8,
2011. Accordingly the Company has presented in this Report, the
consolidated financial statements of the holding company and all its
subsidiaries, duly audited by the Statutory Auditors. The Company has
also disclosed in the Consolidated Balance Sheet the information
required to be provided as per the aforesaid notification dated
February 8, 2011. The Company will make available the audited annual
accounts and related information of its subsidiaries, upon request by
any of its shareholders. The annual accounts of the subsidiary
companies will also be kept for inspection, by any member at the
Registered Office of the Company and its subsidiary companies.
The Company has not accepted any deposits, within the meaning of
Section 58-A of the Companies Act, 1956 read with the Companies
(Acceptance of Deposits) Rules, 1975 made thereunder.
The information 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 is given in the Annexure to this
report.
The information required under the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988, is given in the
Annexure appended hereto and forms part of this report. In terms of
Section 219(1)(b)(iv) of the Act, the Report and Accounts are being
sent to the Members excluding the aforesaid Annexure. Interested
Members may write to the Company Secretary, at the Registered Office of
the Company, for obtaining a copy of the said Annexure.
CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a certificate from the Company''s Auditors
confirming the compliance of conditions of Corporate Governance is
attached to this report.
DIRECTORS'' RESPONSIBILITY STATEMENT
The Directors confirm that :
1) in the preparation of annual accounts, the applicable accounting
standards have been followed.
2) appropriate accounting policies have been selected and applied
consistently, and judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for that period.
3) proper and sufficient care has been taken 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.
4) the annual accounts have been prepared on a going concern basis.
DIRECTORS
Sri V Narayanan, Director and Sri R Ramakrishnan, Director retire from
the Board by rotation and being eligible, offer themselves for
re-appointment.
AUDITORS
The Auditors, M/s Sundaram & Srinivasan, Chartered Accountants,
Chennai, retire and are eligible for re-appointment.
COST AUDITOR
Pursuant to Section 233B(2) of the Companies Act, 1956, the Board of
Directors on the recommendation of the Audit Committee, re-appointed
Sri P Raju Iyer, a Cost Accountant, as Cost Auditor of the Company for
the Financial Year ending 31st March 2014.
INDUSTRIAL RELATIONS
The industrial relations continued to remain congenial during the
current year. The Directors thank the employees for their contribution
to the progress of the Company.
GENERAL
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited.
The Directors wish to thank One North East, the Regional Development
Authority for Cramlington, United Kingdom for the continued support
extended to the Subsidiary.
The Directors wish to thank the Company''s bankers, State Electricity
Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand,
customers and vendors, for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 30, 2013 Chairman & Managing Director
Mar 31, 2012
The Directors are pleased to present the Forty Ninth Annual Report
together with the audited accounts for the year ended 31st March 2012.
FINANCIAL RESULTS Rs lakhs
2011-12 2010-11
Revenue from Operations 214,663.52 181,071.66
Other Income 1,807.43 436.75
Total Revenue 216,470.95 181,508.41
Gross Profit before interest,
depreciation and taxes 31,315.75 23,444.97
Less : Interest ' 3,490.26 2,697.79
Exchange Losses/(Gains) 5,729.74 868.95
Depreciation 6,361.31 5,453.72
15,581.31 9,020.46
Profit before taxes 15,734.45 14,424.51
Less : Provision for tax 4,474.58 3,881.94
Profit after tax 11,259.87 10,542.57
Add : Balance brought forward 3,418.72 2,939.21
Balance available for appropriation 14,678.59 13,481.78
Appropriations
Interim Dividends 2,941.80 2,626.61
Tax on Interim Dividends 467.05 436.45
Transfer to General Reserve 5,000.00 7,000.00
Balance carried forward 6,269.74 3,418.72
14,678.59 13,481.78
SALES & PROFITS
The Company recorded total Net Sales and other income of Rs.2164.71
Crores for the year ended March 31, 2012 as against Rs 1815.08 Crores
achieved during the previous year. The export sale was at Rs 645.88
Crores as against Rs 479.35 Crores in the previous year. The Profit
after tax was higher at Rs 112.60 Crores as against Rs 105.43 Crores in
the previous year.
The Company continues to be a net foreign exchange earner for the
fifteenth year in succession.
DIVIDEND
The Directors have decided to pay as Second Interim Dividend of Re 0.80
per Share of face value of Re 1 each, which together with the Interim
Dividend of Re 0.60 declared and paid earlier would amount to a total
dividend for the year of Rs 1.40 per share of Re 1 each. Dividend
disbursed amounted to Rs 1260.77 lakhs. Second Interim Dividend will
absorb a total amount of Rs 1681.03 lakhs. The Directors do not
recommend any final dividend.
CONSOLIDATED FINANCIAL STATEMENTS / STATUTORY STATEMENTS
As required by Accounting Standard - AS 21 on Consolidated Financial
Statements, the audited Consolidated Financial Statements of the
Company and its Subsidiaries are attached.
As per Section 212 of the Companies Act, 1956, the Company is required
to attach the Directors' Report, Balance Sheet and Profit and Loss
Account of subsidiaries. The Central Government has granted general
exemption from complying with Section 212 of the Companies Act, 1956 to
all companies vide Notification No. 5/12/2007-CL-III dated February 8,
2011. Accordingly the Company has presented in this Report, the
consolidated financial statements of the holding company and all its
subsidiaries, duly audited by the Statutory Auditors. The Company has
also disclosed in the Consolidated Balance sheet the information
required to be provided as per the aforesaid notification dated
February 8, 2011. The company will make available the audited annual
accounts and related information of its subsidiaries, upon request by
any of its shareholders. The annual accounts of the subsidiary
companies will also be kept for inspection, by any member at the
Registered Office of the Company and its subsidiary companies.
The Company has not accepted any deposits, within the meaning of
Section 58-A of the Companies Act, 1956 read with the Companies
(Acceptance of Deposits) Rules, 1975 made there under.
The information 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 is given in the Annexure to this
report.
The information required under the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules 1988, is given in the
Annexure appended hereto and forms part of this report. In terms of
Section 219(1)(b)(iv) of the Act, the Report and Accounts are being
sent to the Members excluding the aforesaid Annexure. Interested
Members may write to the Company Secretary, at the Registered Office of
the Company, for obtaining a copy of the said Annexure.
COST AUDITOR
Pursuant to Section 233(B)(2) of the Companies Act, 1956, the Board of
Directors on the recommendation of the Audit Committee, appointed Sri P
Raju Iyer, a Cost Accountant, as Cost Auditor of the Company for the
Financial year ended 31st March 2012.
CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a certificate from the Company's Auditors
confirming the compliance of conditions of Corporate Governance is
attached to this report.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that :
1) in the preparation of annual accounts, the applicable accounting
standards have been followed.
2) appropriate accounting policies have been selected and applied
consistently, and judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for that period.
3) proper and sufficient care has been taken 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.
4) the annual accounts have been prepared on a going concern basis.
DIRECTORS
Sri K Ramesh, Director and Sri R Srinivasan, Director retire from the
Board by rotation and being eligible, offer themselves for
re-appointment.
AUDITORS
The Auditors, M/s Sundaram & Srinivasan, Chartered Accountants,
Chennai, retire and are eligible for re-appointment.
INDUSTRIAL RELATIONS
The industrial relations continued to remain congenial during the
current year. The Directors thank the employees for their contribution
to the progress of the Company.
GENERAL
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited.
The Directors wish to thank One North East, the Regional Development
Authority for Cramlington, United Kingdom for the continued support
extended to the Subsidiary.
The Directors wish to thank the Company's bankers, State Electricity
Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand,
customers and vendors, for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 28, 2012 Chairman & Managing Director
Mar 31, 2011
Dear Shareholders,
The Directors are pleased to present the Forty Eighth Annual Report
together with the audited accounts for the year ended 31st March 2011.
FINANCIAL RESULTS
Rs lakhs
2010-11 2009-10
Sales - Domestic (including
excise duty) 146,451.86 108,977.92
Less: Excise Duty 13,642.02 8,807.15
132,809.84 100,170.77
Exports 48,029.36 33,215.29
Net Sales 180,839.40 133,386.06
Gross Profit before interest,
depreciation,
extra-ordinary items and taxes 22,844.28 17,032.74
Less: Interest 2,097.10 2,548.25
Exchange Losses/(Gains) 868.95 (1,048.62)
Depreciation 5,453.72 8,419.77 4,748.40 6,248.03
Profit before extra-ordinary
items and tax 14,424.51 10,784.71
Less : Provision for taxation
including earlier years 3,881.94 3,283.38
Profit after tax 10,542.57 7,501.33
Add : Balance brought forward 2,939.21 2,646.38
13,481.78 10,147.71
Appropriations
Interim Dividends 2,626.61 1,891.15
Tax on Interim Dividends 436.45 317.35
Transfer to General Reserve 7,000.00 5,000.00
Balance carried forward 3,418.72 2,939.21
13,481.78 10,147.71
SALES & PROFITS
The Company recorded total Net Sales and other income of Rs.1813.10
Crores for the year ended March 31, 2011 as against Rs.1336.60 Crores
achieved during the previous year. The export sale was at Rs.480.30
Crores as against Rs.332.15 Crores in the previous year. The Profit
after tax was higher at Rs.105.43 Crores as against Rs.75.01 Crores in
the previous year.
The Company continues to be a net foreign exchange earner for the
fourteenth year in succession.
DIVIDEND
The Directors have decided to pay as Second Interim Dividend of Re 0.70
per Share of face value of Re 1 each, which together with the Interim
Dividend of Re 0.55 per Share of face value of Re 1 each declared and
paid earlier would amount to a total dividend for the year of Rs.1.25
per share of Re 1 each. Dividend disbursed amounted to Rs 1155.71
lakhs. Second Interim Dividend will absorb a total amount of Rs 1470.90
lakhs. The Directors do not recommend any final dividend.
CONSOLIDATED FINANCIALS AND STATUTORY STATEMENTS
As required by Accounting Standard -AS 21 on Consolidated Financial
Statements, the audited Consolidated Financial Statements of the
Company and its Subsidiaries are attached.
As per Section 212 of the Companies Act, 1956, the Company is required
to attach the Directors' Report, Balance Sheet and Profit and Loss
Account of subsidiaries. The Central Government has granted general
exemption from complying with Section 212 of the Companies Act, 1956 to
all companies vide Notification No. 5/12/2007-CL-l 11 dated February 8,
2011. Accordingly the Company has presented in this Report, the
consolidated financial statements of the holding company and all its
subsidiaries, duly audited by the Statutory Auditors. The Company has
also disclosed in the Consolidated Balance sheet the information
requied to be provided as per the aforesaid notification dated February
8,2011. The company will make available the audited annual accounts and
related information of its subsidiaries, upon request by any of its
shareholders. The annual accounts of the subsidiary companies will also
be kept for inspection, by any member at the Registered Office of the
Company and its subsidiary companies.
The Company has not accepted any deposits, within the meaning of
Section 58-A of the Companies Act, 1956 read with the Companies
(Acceptance of Deposits) Rules, 1975 made thereunder.
The information 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 is given in the Annexure to this
report.
The information required under the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules 1988, is given in the
Annexure appended hereto and forms part of this report. In terms of
Section 219(1)(b)(iv) of the Act, the Reprot and accounts are being
sent to the Members excluding the aforesaid Annexure. Interested
Members may write to the Company Secretary, at the Registered Office of
the Company, for obtaining a copy of the said Annexure.
CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a certificate from the Company's Auditors
confirming the compliance of conditions of Corporate Governance is
attached to this report.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that:
1) in the preparation of annual accounts, the applicable accounting
standards have been followed.
2) appropriate accounting policies have been selected and applied
consistently, and judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for that period.
3) proper and sufficient care has been taken 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.
4) the annual accounts have been prepared on a going concern basis.
DIRECTORS
Sri Venu Srinivasan, Director, Sri C.V. Karthik Narayanan, Director and
Sri M. Raghupathy, Director, retire from the Board by rotation and
being eligible, offer themselves for re-appointment.
AUDITORS
The Auditors, M/s Sundaram & Srinivasan, Chartered Accountants,
Chennai, retire and are eligible for re-appointment.
INDUSTRIAL RELATIONS
The industrial relations continued to remain congenial during the
current year. The Directors thank the employees for their contribution
to the progress of the Company.
GENERAL
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited.
The Directors wish to thank One North East, the Regional Development
Authority for Cramlington, United Kingdom for the continued support
extended to the Subsidiary.
The Directors wish to thank the Company's bankers, State Electricity
Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand,
customers and vendors, for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 30, 2011 Chairman & Managing Director
Mar 31, 2010
The Directors are pleased to present the Forty Seventh Annual Report
together with the audited accounts for the year ended 31st March 2010.
FINANCIAL RESULTS Rs lakhs
2009-10 2008-09
Sales à Domestic (including
excise duty) 108,977.92 94,664.98
Less : Excise Duty 8,807.15 11,358.07
100,170.77 83,306.91
Exports 33,215.29 42,912.53
Net Sales 133,386.06 126,219.44
Gross Profit before interest,
depreciation,
extra-ordinary items and taxes 17,032.74 16,378.30
Less : Interest 2,548.25 3,849.74
Exchange Losses/(Gains) (1,048.62) 6,070.14
Depreciation 4,748.40 6,248.03 4,223.28 14,143.16
Profit before extra-
ordinary items and tax 10,784.71 2,235.14
Less : Provision for
taxation including earlier
years 3,283.38 494.44
Profit after tax 7,501.33 1,740.70
Add : Balance brought forward 2,646.38 2,309.82
Add : Transfer from Investment
aLLOWANCE (uTILISED) aCCOUNT - 25.06
10,147.71 4,075.58
Appropriations
Interim Dividend 1,891.15 1,050.64
Tax on Interim Dividend 317.35 178.56
Transfer to General Reserve 5,000.00 200.00
Balance carried forward 2,939.21 2,646.38
10,147.71 4,075.58
SALES & PROFITS
The Company recorded total Net Sales and other income of Rs.1336.60
Crores for the year ended March 31, 2010 as against Rs.1265.63 Crores
achieved during the previous year. The export sale was at Rs.332.15
Crores as against Rs.429.13 Crores in the previous year. The Profit
after tax was higher at Rs.75.01 Crores as against Rs.17.41 Crores in
the previous year.
The Company continues to be a net foreign exchange earner for the
thirteenth year in succession.
DIVIDEND
The Directors have decided to pay as Second Interim Dividend of Rs.0.50
per Share of face value of Re.1 each, which together with the Interim
Dividend of Rs.0.40 declared and paid earlier would amount to a total
dividend for the year of Rs.0.90 per share of Re 1 each. Dividend
disbursed amounted to Rs. 840.51 lakhs. Second Interim Dividend will
absorb a total amount of Rs.1050.64 lakhs. The Directors do not
recommend any final dividend.
STATUTORY STATEMENTS
There were 2 deposits amounting to 0.15 lakh which remained unclaimed
as at the end of the year.
Statement relating to the subsidiary companies viz. Sundram Fasteners
Investments Limited, Upasana Engineering Limited, Sundram
Non-Conventional Energy Systems Limited, Sundram Bleistahl Limited,
Sundram International Inc, Sundram Fasteners (Zhejiang) Limited,
Cramlington Precision Forge Limited, Sundram RBI Sdn. Bhd, Peiner
Umformtechnik GmbH, PUT Grundstucks GmbH and Peiner Logistik GmbH is
attached pursuant to Section 212 of the Companies Act, 1956.
The information 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 is given in the Annexure to this
report.
The information required under the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Disclosure of Particulars
in the Report of Board of Directors) Rules, 1988 is given in the
Annexure appended hereto and forms part of this report. In terms of
Section 219(1)(b)(iv) of the Act, the Report and Accounts are being
sent to the Members excluding the aforesaid Annexure. Interested
Members may write to the Company Secretary, at the Registered Office of
the Company, for obtaining a copy of the said Annexure.
CONSOLIDATED FINANCIAL STATEMENTS
As required by Accounting Standard - AS 21 on Consolidated Financial
Statements, the audited Consolidated Financial Statements of the
Company and its Subsidiaries are attached.
In the context of mandatory requirement to present consolidated
accounts, which provides members with a consolidated position of the
Company including its subsidiaries and associates, members are being
provided with the accounts and reports of the Company treating this as
abridged accounts as contemplated under Section 219 of the Companies
Act, 1956. The Company has received the permission from Central
Government under Section 212(8) of the Companies Act, 1956 exempting
the Company from attaching a copy of the Balance Sheet, Profit and Loss
Account and other documents of the Subsidiary Companies. The accounts,
reports and other documents of the subsidiary companies will be made
available to the members upon receipt of a written request from them.
This will help the Company save considerable costs in connection with
printing and mailing.
CORPORATE GOVERNANCE
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate report on Corporate Governance and Management Discussion and
Analysis together with a certificate from the Companys Auditors
confirming the compliance of conditions of Corporate Governance is
attached to this report.
DIRECTORSÃ RESPONSIBILITY STATEMENT The Directors confirm that :
1) in the preparation of annual accounts, the applicable accounting
standards have been followed.
2) appropriate accounting policies have been selected and applied
consistently, and judgments and estimates that have been made are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for that period.
3) proper and sufficient care has been taken 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.
4) the annual accounts have been prepared on a going concern basis.
DIRECTORS
Sri V Narayanan and Sri R Ramakrishnan retire from the Board by
rotation and being eligible, offer themselves for re-appointment.
AUDITORS
The Auditors, M/s Sundaram & Srinivasan, Chartered Accountants,
Chennai, retire and are eligible for re-appointment.
INDUSTRIAL RELATIONS
The industrial relations continued to remain congenial during the
current year. The Directors thank the employees for their contribution
to the progress of the Company.
GENERAL
The Directors wish to thank the Chinese Authorities, Officers of Haiyan
County, Jiaxin City, Zhejiang province, Chinese tax and other
administrative authorities for the support extended to Sundram
Fasteners (Zhejiang) Limited.
The Directors wish to thank One North East, the Regional Development
Authority for Cramlington, United Kingdom for the continued support
extended to the Subsidiary.
The Directors wish to thank the Companys bankers, State Electricity
Boards in Tamil Nadu, Pondicherry, Andhra Pradesh and Uttarakhand,
customers and vendors, for all the assistance rendered by them from
time to time.
On behalf of the Board
Chennai SURESH KRISHNA
May 29, 2010 Chairman & Managing Director
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