Directors Report of Centum Electronics Ltd.
Mar 31, 2022
We have pleasure in presenting the Twenty Ninth Annual Report on the Business and Operations of the Company together with the Audited Statement of Accounts for the Financial Year ended March 31, 2022.
A summary of the Standalone and Consolidated Financial Performance of your Company, for the financial year ended March 31, 2022, is as under:
|
(Rs. in Millions) |
||||
|
Particulars |
Consolidated |
Standalone |
||
|
2021-22 |
2020-21 |
2021-22 |
2020-21 |
|
|
Total Income |
7,880 |
8,232 |
3,538 |
4,284 |
|
Earnings Before Interest, Tax, Depreciation & Amortisation (EBITDA)* |
742 |
895 |
425 |
625 |
|
Depreciation |
432 |
453 |
165 |
158 |
|
Interest |
263 |
295 |
146 |
174 |
|
Profit Before Tax** |
127 |
205 |
172 |
331 |
|
Profit After Tax*** |
(535) |
120 |
118 |
240 |
* Excludes other income and finance income and exceptional item **Excludes exceptional item & share of profit/loss from associate ***includes exceptional item & share of profit/loss from associates
The financials of the Company are prepared under IND AS in pursuance of Section 133 of the Companies Act, 2013 and in compliance with the (Indian Accounting Standards) Rules, 2015.
During the current year of operations, your Company has registered a consolidated total income of '' 7,880 million compared to previous financial year total income of '' 8,232 million. Your Company has earned a Profit Before Tax of '' 127 million. However, due to the exceptional expenditure of '' 603.54 million, arising mainly due to diminution of investment in our associate company (HOLIWATT), (as explained in note no. 38 of the consolidated financial statement) incurred Loss of '' 535 million.
At standalone level, total income was '' 3,538 million compared to previous financial year total income of '' 4,284 million. Further, your Company has earned a net profit after tax of '' 118 million.
3. Subsidiaries:a. Centum Electronics UK Limited
During the year, Centum Electronics UK Limited, a wholly owned subsidiary company, has registered total income of '' 2 million and incurred a net loss of '' 0.10 million.
b. Centum Adeneo India Private Limited
During the year, Centum Adeneo India Private Limited, a wholly owned subsidiary company, has
registered revenue of '' 192 million and earned a net profit after tax of '' 4 million for the year.
c. Centum Adetel Group S.A.
During the year, Centum Adetel Group S.A. the subsidiary company has registered total income of '' 4,588 million and incurred a net loss of '' 573 million.
During the financial year, your Board of Directors had reviewed the affairs of the subsidiaries. The consolidated financial statements of your Company are prepared in accordance with Section 129(3) of the Companies Act, 2013; and forms part of this Annual Report.
A statement containing the salient features of the financial statements of the subsidiaries, in the prescribed format AOC-1, is appended as "Annexure-1" to the Board''s Report.
The statement also provides the details of performance and financial position of each of the subsidiaries.
The separate audited financial statements in respect of the subsidiary companies are available on the website of your Company at www.centumelectronics.com.
4. Consolidated Financial Statements:
The Consolidated Financial statements have been prepared by the Company in accordance with the applicable Indian Accounting Standards (Tnd AS'') and the same together with the Auditor''s Report thereon is provided in the Annual Report.
The Financial Statements of the subsidiary and related detailed information will be kept at the Registered Office of the Company and will be available to investors seeking information at any time.
The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy, as approved by the Board, is available on the Investor page at Company''s website www.centumelectronics.com.
Your Directors are pleased to recommend a Dividend of '' 2.50 per equity share (25%) having face value of '' 10 per equity share for the financial year ended March 31, 2022. The final dividend recommended is subject to approval of the Shareholders in the ensuing Annual General Meeting of the Company.
The total dividend payout will be '' 32.21 million for the financial year 2021-22.
6. Material changes and commitments, if any, affecting the financial position of the company, having occurred since the end of the Year and till the date of the Report
There have been no material changes and commitments, which affect the financial position of the Company which have occurred between the end of the financial year to which the financial statements relate and the date of this Report.
7. Change in nature of Business, if any:
There has been no material change in the nature of business during the year under review.
The Board of Directors have decided to retain the entire amount of profit under Retained Earnings. Accordingly, your Company has not transferred any amount to General Reserves for the year ended March 31, 2022.
During the year, there was no change in the share capital of the Company. As on March 31, 2022 the Authorised Share Capital of the Company was '' 15,50,00,000/- divided into 1,55,00,000 equity shares of '' 10/- each and paid - up equity share capital of the Company is '' 12,88,47,810 divided into '' 1,28,84,781 equity shares of '' 10/- each.
10. Debentures: Issue of Shares or Other Convertible Securities:
During the year under review, the Company has not issued any Debentures. As on date, the Company does not have any outstanding Debentures.
Your Company''s equity shares are tradable only in electronic form. As on March 31, 2022, 99.23% of the Company''s total paid up equity share capital representing 1,27,86,207 shares are in dematerialised form.
12. Transfer to Investor Education and Protection Fund:
Pursuant to the applicable provisions of the Companies Act, 2013 ("the Act") read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the Rules"), all unpaid or unclaimed dividends are required to be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government, after completion of seven years. Further, according to the Rules, the shares in respect of which dividend has not been paid or claimed by the Members for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority.
The Company had sent individual notices and also advertised in the newspapers seeking action from the Members who have not claimed their dividends for seven consecutive years or more.
During the year, the Company transferred '' 3,71,023/- to IEPF, the amount in unpaid Final Dividend Account opened in 2013-14 and the amount in unpaid Interim Dividend Account opened in 2014-15 which was due & payable and remained unclaimed & unpaid for a period of seven years as provided under Section 124(5) of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Auditing, Transfer and Refund) Rules, 2016. The Company, pursuant to the circulars issued by the Ministry of Corporate Affairs under the aforesaid rules mandated the transfer of shares on which dividend has not been paid or claimed by the Shareholders for seven consecutive years or more to the demat account of the IEPF Authority. The Company has accordingly transferred 6,137 shares to the demat account of the IEPF Authority.
Members / claimants whose shares, unclaimed dividend, have been transferred to the IEPF Authority Demat Account as the case may be, may claim the shares or apply for refund by making an application to the IEPF Authority in Form IEPF-5 (available on http:www.iepf.gov.in) along with requisite fee as decided by IEPF Authority from time to time.
13. Internal Control Systems and their adequacy:
The Company has an Internal Control System, commensurate with the size, scale and complexity of its
operations. The Company has appointed M/s. KPMG, Chartered Accountants, as its Internal Auditor. The Audit Committee defines the scope and areas of Internal Audit. The Internal Auditor audits the areas recommended by the Committee every year.
The Audit observations and corrective actions thereon are being presented to the Audit Committee of the Board. Based on the report of Internal Auditor process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, the Internal Audit was done on the areas recommended and no material weakness was observed.
Additionally, the Company also has an in-house Internal Auditor to check the controls and strengthen the systems and processes.
14. Directors and Key Managerial Personnel:
The Board of Directors of the Company as on March 31, 2022 comprises of 8 Directors out of which 2 are Executive Directors, 1 Non-Executive Director and 5 are Non-Executive Independent Directors. The composition of the Board of Directors of the Company is in accordance with the provisions of Section 149 of the Act and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with an appropriate combination of Executive, Non-Executive and Independent Directors. During the year under review Mr. S Krishnan ceased to be a Director with effect from August 14, 2021 and Mr. Nagaraj K V resigned from the office of Whole time Company Secretary with effect from March 10, 2022.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Dr. Swarnalatha Mallavarapu, Director (DIN: 00288771) will retire by rotation at the Twenty Ninth Annual General Meeting and being eligible, has offered herself for reappointment till the next Annual General Meeting. Your Directors have recommended the re-appointment of Dr. Swarnalatha Mallavarapu for approval of the shareholders, in the ensuing Annual General Meeting of your Company.
None of the Directors of the Company are disqualified under Section 164(2) of the Companies Act, 2013.
In compliance with Section 203 of the Companies Act, 2013, Mr. Apparao V Mallavarapu, Chairman & Managing Director, Mr. K S Desikan, Chief Financial Officer and Ms.Indu H S, Company Secretary & Compliance Officer are the Key Managerial Personnel in accordance with the provisions of Section 203 of the Companies Act, 2013.
a. Board Meetings:
A calendar of Meetings is prepared and circulated in advance to the Directors.
During the year, the Company has convened 4 (Four) Meetings of the Board of Directors and 4 (Four) Meetings of the Audit Committee. The details of
which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the relaxations granted by the Ministry of Corporate Affairs.
b. Declaration by Independent Directors:
The Company has received necessary declaration from each of the Independent Directors under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act 2013 and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Status on Independent Directors'' proficiency test
The Independent Directors on the Board of the Company have the integrity, expertise & experience and the said Directors have either cleared the proficiency self-assessment test conducted by the Institute of Corporate Affairs notified under subsection (1) of section 150 of the Act or were exempted from appearing for the proficiency self-assessment test.
c. Remuneration Policy:
The Board has, upon recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration as required under Section 178(3) of the Companies Act, 2013. The Policy is available on the Company''s website https://www.centumelectronics. com/investor-relations/. There has been no change in the Policy since the last financial year.
d. Annual evaluation of Board, its Committees and Individual Directors:
The Board of Directors has carried out an annual evaluation of its own performance, its Committees and individual Directors pursuant to the requirements of Section 134 (3) (p) of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Further, Independent Directors have reviewed the performance of the Board, its Chairman and NonExecutive Directors and other items as stipulated under Schedule IV of the Companies Act, 2013 and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 at their separate meeting held on 24 January 2022.
e. Committees of the Board:
Details with respect to the Audit Committee, the Nomination and Remuneration Committee,
the Stakeholders'' Relationship Committee, Risk Management Committee and Corporate Social Responsibility Committee and meetings of the said Committees held during the year forms part of the Corporate Governance Report annexed to this Report.
15. Directors'' Responsibility Statement:
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your
Directors confirm:
i. that in the preparation of annual accounts for the year ended March 31, 2022, the applicable Accounting Standards have been followed along with the proper explanations relating to material departures;
ii. that such accounting policies as mentioned in Note 1 of the Notes to the Financial Statements have been adopted and applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for year ended on that date;
iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. that the annual financial statements have been prepared on a going concern basis;
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively;
vi. that systems to ensure compliance with the provisions of all applicable laws were in place, were adequate and operating effectively.
Further the Board of Directors confirm that the Company has complied with the Secretarial Standards on the Board and General Meetings issued by the Institute of Company Secretaries of India, as applicable to the Company, during the financial year ended March 31, 2022.
16. Particulars of Loans, Guarantees or Investments:
The particulars of loans given, investments made, securities provided and guarantees given as required under Section 186 of the Companies Act, 2013 are provided in note 5, 6 and 44(c)(i) forming part of the standalone financial statements.
17. Contracts and Arrangements with Related Parties:
All related party transactions that were entered into during the financial year were in the ordinary course of business and were at arm''s length basis. There were no material significant related party transactions made by the Company during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.
All the related party transactions were placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of foreseen and repetitive nature in terms of Regulation 23(3)(a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Company has framed a policy on dealing with the related party transactions and the same is available on the Company''s website https://www.centumelectronics.com/ investor-relations.
Your Directors draw attention of the members to Note no. 41 to standalone financial statement which sets out the related party disclosures.
18. Auditors:a. Statutory Auditors
The Members at the Twenty Fourth Annual General Meeting of the Company held on July 11, 2017, approved the appointment of M/s. S.R Batliboi & Associates LLP, Chartered Accountants (Firm registration number: 101049W/E300004) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of 24th Annual General Meeting till the conclusion of the 29th Annual General Meeting.
The Report of the Statutory Auditors for the financial year 2021-22 does not contain any qualification on the financial statements of the Company.
The details of remuneration of the Statutory Auditors with break-up of fee paid as required by the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the financial year 2021-2022 is given as part of the Corporate Governance Report.
The Board, based on the recommendation of the Audit Committee, has approved their re-appointment as the Statutory Auditors of the Company, for a second term of five consecutive years, from the conclusion of 29th AGM scheduled to be held in the year 2022 till the conclusion of the 34th AGM to be held in the year 2027, for approval of the shareholders of the Company at the ensuing AGM. M/s. S.R Batliboi & Associates LLP have confirmed that they satisfy the independence criteria required under the Companies Act, 2013 and other applicable guidelines and regulations.
In terms of Section 204(1) of the Companies Act, 2013, the Board had appointed Ms. Aarthi G Krishna, Practising Company Secretary (CP No.5645), to conduct Secretarial Audit for the financial year 202122. The Secretarial Audit Report for the financial year ended March 31, 2022 is enclosed as "Annexure-2" to this Report.
The said Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer made by the Secretarial Auditor.
As required under Section 148 of the Companies Act, 2013 the Board of Directors of the Company has appointed M/s. K.S. Kamalakara & Co., Cost Accountants (Firm Registration No. 000296) as Cost Auditors of the Company for the financial year 2022-23 at a fee of '' 1,00,000/- plus applicable taxes and out of pocket expenses. The ratification of remuneration payable to Cost Auditors is placed as an agenda item for approval of shareholders at the ensuing annual general meeting.
Your Company believes in adopting best practices of Corporate Governance. A report on Corporate Governance as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is forming part of this Annual Report.
A certificate from the Practicing Company Secretary of the Company regarding compliance of the conditions stipulated for Corporate Governance as required under Clause E of Schedule V read with Regulation 34 (3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached to this report. The declaration by the Managing Director addressed to the Members of the Company pursuant to Clause D of Schedule V Read with Regulation 34 (3) Chapter IV of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 regarding adherence to the Code of Conduct by the Members of the Board and by the Members of the Senior Management Personnel of the Company is also attached to this Report.
20. Conservation of Energy, Technology absorption, Research & Development and Foreign Exchange Earnings and Outgo:
The particulars prescribed under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are enclosed as "Annexure-3" to this Report.
21. Corporate Social Responsibility:
As part of the Company''s initiatives under "Corporate Social Responsibility (CSR)", the Company has funded several projects that aid and improve education, literacy and healthcare for children. It has also funded and participated in projects that support and aid children with disabilities.
The disclosures as required under Section 135 of the Companies Act, 2013 read with Rule 8(1) of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed as "Annexure-4" to this Report.
22. Details of establishment of Vigil Mechanism:
In accordance with Section 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a Vigil Mechanism and has a Whistle Blower Policy. The Policy is available at the Company''s website https://www.centumelectronics.com/investor-relations.
The Company did not receive any complaints during the year under review.
The information relating to remuneration and other details as required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is enclosed as "Annexure-5" to this report.
Further, the details of employees who are in receipt of remuneration exceeding the limits prescribed under Section 134 of the Companies Act, 2013 read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided upon request.
In terms of Section 136(1) of the Companies Act, 2013 and the Rules made thereunder, the Annual Report is being sent to the Shareholders and others entitled thereto excluding the information on employees'' particulars. The same is available for inspection by the Shareholders at the Registered Office of the Company during business hours on working days of the Company up to the date of ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.
24. Prevention, Prohibition and Redressal of Sexual Harassment at workplace:
The Company has zero tolerance for sexual harassment at workplace and has formulated a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.
The Company has also constituted an Internal Complaints Committee, to inquire into complaints of sexual harassment and recommend appropriate action. All the employees of the Company as a part of induction are sensitized about the provisions of the said Act.
The Company has not received any complaint of sexual harassment during the financial year 2021-22.
In accordance with the Companies Act, 2013, the annual return in the prescribed format is available at https://www. centumelectronics.com/annual-return/.
26. Management Discussion and Analysis Report:
The Management Discussion and Analysis Report for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is forming part of the Annual Report.
27. Business Responsibility Report:
As required under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility Report is provided in a separate section and forms part of the Annual Report.
28. Employee Stock Option Plan:
As a measure of rewarding the employees, your Company had introduced an Employee Stock Option Plan (ESOP) during the year 2013.
Further, "Centum Electronics Limited - Restricted Stock Unit Plan 2021" scheme was approved by the Shareholders of the Company through the ''Postal Ballot'' process on October 5, 2021. BSE Limited and the National Stock Exchange of India vide their letters dated October 28, 2021 and October 12, 2021 respectively have accorded their in-principle approval for listing up to a maximum of 1,75,000 Restricted Stock Units under the scheme.
The certificate from the Secretarial Auditor on the implementation of ESOP 2013 and RSU 2021 in accordance with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 has been uploaded on the website of the Company at www.centumelectronics.com.
The particulars prescribed under Regulation 14 read with Part F of Schedule I of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 has been uploaded on the website of the Company at www.centumelectronics.com.
The Company is proud recipient of SIDM Champion Award (Society of Indian Defence Manufacturers) from Hon''ble Defence Minister, Shri Rajnath Singh under Large Category for Import Substitution for an outstanding contribution made towards critical technology development in the area
of Defence Systems in line with Make in India policy of Governement of India.
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions with regard to the following during the year under review:
a. Details relating to deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOP referred to in this report.
d. There is no remuneration received by the Managing Director from the subsidiary company.
e. No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and the Company''s operations in future.
f. The details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016.
g. 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.
h. Details in respect of frauds reported by Auditors under sub-section (12) of Section 143 other than those which are reportable to the Central Government.
Your Directors thank the customers for their continued patronage and the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of all the employees, who have demonstrated their skill, teamwork and commitment through their competence, hard work, cooperation and support.
Your Directors would also like to place on record the support received from, the Electronic Hardware Technology Park, the Customs and GST Departments, the Reserve Bank of India, the Department of Industries and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other Central and State Governmental agencies.
Mar 31, 2018
The Directors have pleasure in presenting their Twenty Fifth Annual Report on the business and operations of your Company and the audited Statement of Accounts for the year ended 31st March 2018.
1. FINANCIAL HIGHLIGHTS Rs. in Million
|
Particulars |
Consolidated |
Standalone |
||
|
2017-18 |
2016-17 |
2017-18 |
2016-17 |
|
|
Revenue |
8,682 |
7,337 |
3,664 |
4,092 |
|
Profit before Depreciation and Interest |
363 |
779 |
21 |
535 |
|
Depreciation |
336 |
232 |
120 |
80 |
|
Interest |
162 |
89 |
93 |
46 |
|
Profit/(-)Loss before tax |
-135 |
458 |
-192 |
409 |
|
Profit after tax |
-145 |
372 |
-215 |
308 |
2. PERFORMANCE
During the current year of operations, your company has registered a consolidated revenue of Rs.8682 million, an increase of about 13% compared to the previous financial year. Your company posted Loss of Rs.145 million for the year.
At standalone level, a revenue of Rs.3664 million, a decrease of about 10% compared to the previous financial year. Your company posted Loss of Rs.215 million for the year.
3. Subsidiaries and Joint ventures
a. Centum Adetel Group S.A.
During the year, Centum Adetel Group S.A. the subsidiary company, has registered revenue of Rs.5,030 million and posted a profit of Rs.142 million.
b. Centum Rakon India Private Limited
During the year, Centum Rakon India Private Limited (CRI), the joint venture company, has registered revenue of Rs.696 million and incurred a loss of Rs.52 million.
Based on the discussion with the Joint venture partner and the strategy of the company, it was decided to sell off the shares held in CRI for a consideration of US$ 5.50 Million. The transaction has been completed in May 2018 and as agreed 75% of the consideration is received and the remaining 25% will be received on completion of transition or eighteen months from the date of signing, whichever is earlier.
Statement containing salient features of the financial statement of subsidiary is attached herewith as Annexure - I
The company has adopted IND AS in preparation of financial statements with effect from 1st April 2017 in pursuance of the requirements of Companies (Indian Accounting Standards (IND AS)) Rules 2015. The Consolidated financial statements were prepared by including the financials of Centum Adetel Group S.A. and the share of loss in the case of CRI.
4. DIVIDEND
Pursuant to the approval of the Board of Directors on 13th February 2018, your Company paid an interim dividend of Rs.1/- per equity share of face value of Rs.10/ -each, to shareholders who were on the register of members as on 22nd February 2018, being the record date fixed for this purpose. The total dividend payout was Rs.12.86 million for the year ended March 31, 2018.
5. CONSOLIDATED FINANCIAL STATEMENTS AND SUBSIDIARY
The Consolidated Financial statements have been prepared by the Company in accordance with the applicable Indian Accounting Standards (âInd AS'') and the same together with the Auditor''s Report thereon is provided in the Annual Report.
The Financial Statements of the subsidiary and related detailed information will be kept at the Registered Office of the Company, and will be available to investors seeking information at any time.
The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy, as approved by the Board, is available on the Investor page at Company''s website www.centum electronics.com.
6. RISK MANAGEMENT
Your Company has a robust Risk Management policy, Your Company regularly assess the risks and ensures that the risk mitigation plans are in place.
7. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Company has appointed KPMG, Chartered Accountants, as its Internal auditor. The Audit Committee defines the scope and areas of internal audit. The Internal auditor audits the areas recommended by the committee every year.
The audit observations and corrective actions thereon are being presented to the Audit Committee of the Board. Based on the report of Internal auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, the internal audit was done on the areas recommended and no material weakness observed.
8. DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review there was no change in the composition of Board of Directors/Key Managerial Personnel.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Dr. Swarnalatha Mallavarapu will retire by rotation at the 25th Annual General Meeting and being eligible, has offered herself for re-appointment.
a. Declaration by independent directors
The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he meets the criteria of independence as laid down under Section 149 (6) of the Act and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
b. Annual evaluation of Board, its Committees and Individual Directors
The Board of Directors has carried out an annual evaluation of its own performance, its Committees and individual Directors pursuant to the requirements of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Further, Independent directors have reviewed the performance of the Board, its Chairman and NonExecutive Directors and other items as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
c. Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration as required under Section 178(3) of the Companies Act, 2013. The policy is available on the company website www.centumelectronics.com. There has been no change in the policy since the last fiscal year.
d. Meetings
A calendar of Meetings is prepared and circulated in advance to the Directors.
During the year, the company has convened five meetings of the Board of directors and four meetings of the Audit Committee. The details of which are given in the Corporate Governance Report. The Intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.
9. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors confirm:
i. that in the preparation of annual accounts for the year ended March 31, 2018, the applicable Accounting Standards have been followed along with the proper explanations relating to material departures;
ii. that such accounting policies as mentioned in Note 1 of the Notes to the Financial Statements have been adopted and applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for year ended on that date;
iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
iv. that the annual financial statements have been prepared on a going concern basis.
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively.
vi. that systems to ensure compliance with the provisions of all applicable laws were in place, were adequate and operating effectively.
Further the Board of Directors confirms that the Company has complied with the Secretarial Standards on the Board Meetings issued by the Institute of Company Secretaries of India, as applicable to the Company, during the financial year ended 31 March 2018.
10. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All related party transactions that were entered into during the financial year were in the ordinary course of business and were at an arm''s length basis. There were no materially significant related party transactions made by the company during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the company at large.
All the related party transactions were placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is being obtained for the transactions which are of a foreseen and repetitive nature in terms of Regulation 23(3)(a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The company has framed a policy on dealing with the related party transactions and the same is available on the company website.
Your directors draw attention of the members to Note 40 to financial statement which sets out the related party disclosures.
11. AUDITORS
a. Statutory auditors
The members at the 24th Annual General Meeting of the Company held on July 11, 2017, approved the appointment of M/s. S.R Batliboi & Associates LLP Chartered Accountants (Firm registration number: 101049W/E300004) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of 24th Annual General Meeting till the conclusion of the 29th Annual General Meeting.
The statutory audit report for the year 2017-18 does not contain any qualification, reservation or adverse remark or disclaimer made by statutory auditor.
b. Secretarial audit
The Board has appointed Ms. Aarthi G Krishna,
Practicing Company Secretary, to conduct Secretarial Audit for the financial year 2017-18. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith as Annexure 11 to this report.
The said secretarial audit report does not contain any qualification, reservation or adverse remark or disclaimer made by the secretarial auditor.
12. CORPORATE GOVERNANCE
Your Company believes in adopting best practices of corporate governance. A report on corporate governance along with a certificate from a Practicing Company Secretary confirming the compliance for the year ended 31 March 2018 as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed (Annexure III) and forms part of this report.
13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (3) (m) of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are provided in Annexure - IV attached to this report.
14. PARTICULARS OF EMPLOYEES
The ratio of remuneration of each whole-time director and key managerial personnel (KMP) to the median of employees'' remuneration as per Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure - IX.
Further, the information on the employees drawing salary more than the limits as prescribed under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, will be provided upon request.
However, as per the provisions of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees'' particulars. The same is available for inspection by the Members at the Registered Office of the company during business hours on working days of the Company up to the date of ensuing Annual General meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.
15. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The details of loans, guarantees and investments within the meaning of Section 186 of the Companies Act, 2013, are provided under Note 40 of the audited financial statements.
16. CORPORATE SOCIAL RESPONSIBILITY
As part of the Company''s initiatives under âCorporate Social Responsibility (CSR)", the Company has funded several projects that aid and improve education, literacy and healthcare for children. It has also funded and participated in projects that support and aid children with disabilities.
The Annual Report on CSR activities is annexed herewith as Annexure - V.
17. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM
In accordance with Section 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a Vigil Mechanism and has a Whistle Blower Policy. The policy is available at the Company''s website.
During the year under review, there are no such instances to report.
18. PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE
The Company has zero tolerance for sexual harassment at workplace and has formulated a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.
The Company has also constituted an Internal Complaints Committee, to inquire into complaints of sexual harassment and recommend appropriate action.
The Company has not received any complaint of sexual harassment during the financial year 2017-18.
19. EXTRACT OF ANNUAL RETURN
The extract of the Annual Return as at 31 March 2018 in Form MGT-9 is annexed and forms part of this Report as Annexure - VI.
20. MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of the listing agreement, the Management Discussion and Analysis Report giving details of the company''s business and operating results is attached to this report as Annexure - VII.
21. EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an Employee Stock Option Plan (eSoP) during year 2007 & 2013.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee Stock Option scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are given in the Annexure - VIII attached to this report.
22. GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions with regard to the following during the year under review:
a. Details relating to deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares) to employees of the company under any scheme save and except ESOP referred to in this report.
d. There is no remuneration received by the Managing Director from the subsidiary company.
e. No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and the company''s operations in future.
23. ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of all the employees, who have demonstrated their skill, teamwork and commitment through their competence, hard work, cooperation and support.
Your Directors would also like to place on record the support received from, the Electronic Hardware Technology Park, the Customs and Excise Departments, the Reserve Bank of India, the Department of Industries and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other Central and State Governmental agencies.
By the order of the Board
For Centum Electronics Limited
Apparao V Mallavarapu S. Krishnan
Chairman & Managing Director Director
DIN : 00286308 DIN : 01807344
Place: Bangalore
Date: May 30, 2018
Mar 31, 2017
The Directors have pleasure in presenting their Twenty Fourth Annual Report on the business and operations of your Company and the audited Statement of Accounts for the year ended 31st March 2017.
1. FINANCIAL HIGHLIGHTS
Rs. in Million
|
Particulars |
Consolidated |
Standalone |
||
|
2016-17 |
2015-16 |
2016-17 |
2015-16 |
|
|
Revenue |
7,645 |
4,129 |
3,979 |
3,433 |
|
Profit before Depreciation and Interest |
785 |
559 |
544 |
519 |
|
Depreciation |
292 |
167 |
89 |
62 |
|
Interest |
88 |
33 |
49 |
25 |
|
Profit before tax |
405 |
359 |
406 |
432 |
|
Profit after tax |
312 |
263 |
308 |
324 |
2. PERFORMANCE
During the current year of operations, your company has registered the highest consolidated revenue in its history, of Rs.7645 million, an increase of about 85% compared to the previous financial year. Your company posted Profit after Taxes of Rs.312 million with an increase of 19% over the previous financial year.
At standalone level, a revenue of Rs.3979 million, an increase of about 16% compared to the previous financial year. Your company posted Profit after Taxes of Rs.308 million for the year.
Subsidiary
i. Centum Rakon India Private Limited
During the year, Centum Rakon India Private Limited has registered revenue of Rs.744 million and incurred a loss of Rs.0.69 million.
ii. Centum Adetel Group S.A.
During the year, Centum Adetel Group S.A. has registered revenue of Rs.3052 million and posted a profit of Rs.7 million.
Statement containing salient features of the financial statements of subsidiary companies is attached herewith as Annexure - I.
3. DIVIDEND
During the year, your company has declared an interim dividend of Rs.2 per share and proposed a final dividend of Rs.3 per share totaling to Rs.5 per share for the year 2016-17. The total dividend payout was Rs.77 million for the year.
4. CONSOLIDATED FINANCIAL STATEMENTS AND SUBSIDIARY
The Consolidated Financial statements have been prepared by the Company in accordance with the applicable Accounting standards issued by the Institute of Chartered Accountants of India and the same together with the Auditorâs Report thereon is provided in the Annual Report.
The annual accounts of the subsidiary and related detailed information will be kept at the Registered Office of the Company, and will be available to investors seeking information at any time.
The Company has adopted a Policy for determining Material Subsidiaries in terms of Regulation 46 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy, as approved by the Board, is available on the Investor page at Companyâs website centumelectronics.com.
5. RISK MANAGEMENT
Your Company has a robust Risk Management policy. Your Company regularly assess the risks and ensures that the risk mitigation plans are in place.
6. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The Company has appointed Ernst and Young LLP., as its Internal auditor. The Audit Committee defines the scope and areas of internal audit. The Internal Auditor audits the areas recommended by the committee every year.
The audit observations and corrective actions thereon are being presented to the Audit Committee of the Board. Based on the report of Internal Auditors, process owners undertake corrective action in their respective areas and thereby strengthen the controls. During the year, the internal audit was done on the areas recommended and no material weakness was observed.
7. DIRECTORS AND KEY MANAGERIAL PERSONNEL
No Director or Key Managerial Person has been appointed or has retired or resigned during the year.
Further, all the Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149 (6) of the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
a. Annual evaluation of Board, its Committees and Individual Directors:
The Board of Directors has carried out an annual evaluation of its own performance, its Committees and individual Directors pursuant to the requirements of the Act and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Further, Independent directors have reviewed the performance of the Board, its Chairman and NonExecutive Directors and other items as stipulated under the listing regulations.
b. Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Nomination and Remuneration Policy is attached to this report as Annexure - II.
c. Meetings
A calendar of Meetings is prepared and circulated in advance to the Directors.
During the year, the company has convened nine meetings of the Board of directors and six meetings of the Audit Committee. The details of which are given in the Corporate Governance Report. The Intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.
8. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors confirm:
i. that in the preparation of annual accounts for the year ended March 31, 2017, the applicable Accounting Standards have been followed along with the proper explanations relating to material departures;
ii. that such accounting policies as mentioned in Note 1 of the Notes to the Financial Statements have been adopted and applied consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2017 and of the profit of the Company for year ended on that date;
iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
iv. that the annual financial statements have been prepared on a going concern basis.
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively.
vi. that systems to ensure compliance with the provisions of all applicable laws were in place, adequate and operating effectively.
9. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All related party transactions that were entered into during the financial year were in the ordinary course of business and were at an armâs length basis. There were no materially significant related party transactions made by the company during the year with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the company at large.
All the related party transactions were placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is being obtained for the transactions which are of a foreseen and repetitive nature in terms of Regulation 23(3)(a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The company has framed a policy on dealing with the related party transactions and the same is available on the company website.
Your directors draw attention of the members to Note 34 to financial statement which sets out the related party disclosures.
10. AUDITORS
a. Statutory auditors
The present statutory auditors, M/s. B.S.R & Co. LLP, Chartered accountants (Firm Registration No.101248W/W-100022) will hold office up to the ensuing Annual General Meeting. They have been the auditors for the company since 1998. Pursuant to Section 139 of the Companies Act, 2013 and the Rules made thereunder, it is mandatory to rotate the statutory auditors on completion of two terms of five consecutive years. The Rules also lay down the transitional period that can be served by the existing auditors depending on the number of consecutive years for which an audit firm has been functioning as auditor in the same company. The incumbent auditors, M/s. B.S.R & Co. LLP, Chartered accountants (Firm Registration No.101248W/W-100022) have served the company for over 10 years before the Act was notified and will be completing the maximum number of transitional period (three years) at the ensuing Annual General Meeting.
Accordingly, the Audit committee and the Board of Directors of the company have recommended to the shareholders for the appointment of M/s. S.R. Batliboi & Associates LLP, Chartered Accountants, as statutory auditors for a period of 5 consecutive years.
M/s. S.R. Batliboi & Associates LLP, Chartered Accountants have furnished a certificate of their eligibility under Sec 139 of the Companies Act, 2013 and the Rules framed thereunder for the appointment as Auditors of the company. Also as required under Regulation 33(1)(d) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the auditors have confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India.
b. Secretarial audit
The Board has appointed Ms. Aarthi G Krishna, Practicing Company Secretary, to conduct Secretarial Audit for the financial year 2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017 is annexed herewith as Annexure III to this report.
11. AWARDS AND RECOGNITIONS
Your company has received the below awards during the year under review:
i. âChampion of Innovation Awardâ received by Mr. Apparao V Mallavarapu, Chairman and Managing Director, from the Prime Minister of New Zealand at the New Zealand Innovation Showcase 2016 event.
ii. Winner of IESA-NASSCOM Deftronics Award 2016 - Best Electronics Manufacturing Company in A & D category.
iii. The Mentor Graphics Silicon India Leadership award for Embedded/VLSI Industry under the category - Established Indian Companyâ
12. CORPORATE GOVERNANCE
Pursuant to Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the company has complied with the requirements. The Certificate on compliance of Corporate Governance requirements, issued by the Statutory Auditors is annexed to the Report of Corporate Governance. The Report on Corporate Governance is attached herewith as Annexure IV.
13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (3) (m) of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are given in the annexure - V attached to this report.
14. PARTICULARS OF EMPLOYEES
The information pursuant to Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the company, will be provided upon request.
However, as per the provisions of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employeesâ particulars. The same is available for inspection by the Members at the Registered Office of the company during business hours on working days of the Company up to the date of ensuing Annual General meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.
15. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The details of the investments made by the Company are in Note 10 of the audited financial statements. The Company has made an investment amounting to Rs.474.44 Million during the year within the meaning of Section 186.
16. CORPORATE SOCIAL RESPONSIBILITY
As part of its initiatives under âCorporate Social Responsibility (CSR), the Company has funded many projects that aid and improve education, literacy and healthcare for children. It has also funded and participated in projects that support and aid children with disabilities. These projects are largely in accordance with Schedule VII of the Companies Act, 2013.
The Annual Report on CSR activities is annexed herewith as âAnnexure - VIâ.
17. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM
The Company has a Vigil mechanism to deal with the instances of fraud and mismanagement, if any. The details of the Policy is explained in the Corporate Governance Report and also posted on the website of the company. During the year under review, there are no such instances to report.
18. PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE
The Company has zero tolerance for sexual harassment at workplace and has formulated a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.
The Company has also constituted an Internal Complaints Committee, to inquire into complaints of sexual harassment and recommend appropriate action.
The Company has not received any complaint of sexual harassment during the financial year 2016-17.
19. EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as âAnnexure - VII.
20. MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, a detailed Management Discussion and Analysis Report giving details of the companyâs business and operating results is given in Annexure - VIII attached to this report.
21. EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an Employee Stock Option Plan (ESOP) during the year 2007 & 2013.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee Stock Option scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are given in the Annexure - IX attached to this report.
22. GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
a. Details relating to deposits covered under Chapter V of the Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend, voting or otherwise.
c. Issue of shares (including sweat equity shares) to employees of the company under any scheme save and except ESOP referred to in this report.
d. There is no remuneration received by the Managing Director from the subsidiary company.
e. No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and the companyâs operations in future.
23. ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of all the employees, who have demonstrated their skill, teamwork and commitment through their competence, hard work, cooperation and support.
Your Directors would also like to place on record the support received from, the Electronic Hardware Technology Park, the Customs and Excise Departments, the Reserve Bank of India, the Department of Industries and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other Central and State Governmental agencies.
By the order of the Board
For Centum Electronics Limited
Apparao V Mallavarapu S. Krishnan
Chairman & Managing Director Director
DIN :00286308 DIN :01807344
Place: Bangalore
Date: May 30, 2017
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting their Twenty Second Annual
Report on the business and operations of your Company and the audited
Statement of Accounts for the year ended 31st March 2015.
1. FINANCIAL HIGHLIGHTS Rs.Millions
Consolidated
Particulars 2014-15 2013-14
Revenue 4,879.97 4,258.87
Profit before Depreciation and Interest 1057.99 828.25
Depreciation 166.94 156.84
Interest 25.16 54.42
Profit before tax 865.89 616.99
Standalone
2014-15 2013-14
Particulars
Revenue 3,162.24 2,981.82
Profit before Depreciation and Interest 511.82 496.98
Depreciation 71.30 71.59
Interest 13.48 37.56
Profit before tax 427.04 387.83
s
2. PERFORMANCE
During the current year of operations, your company has registered
revenue of Rs. 4,879.97 million at consolidated level, an increase of
about 15% compared to the previous financial year. Your company posted
Profit before Taxes of Rs. 865.89 million with an increase of 40% over
the previous financial year.
At standalone level, a revenue of Rs. 3162.24 million, an increase of
about 6% compared to the previous financial year. Your company posted
Profit before Taxes of Rs. 427.04 million with an increase of 10% over
the previous financial year.
Subsidiary
During the Eighth year of operations, Centum Rakon India Private
Limited has registered revenue of Rs. 1832.77 million and posted Profit
before Taxes of Rs. 495.53 million.
3. Dividend
During the year an interim dividend of Re. 1 per share has been paid.
Also a final dividend of Rs. 2/- per share has been recommended by the
Board aggregating to a total dividend of Rs. 3/- per share for the
year. The total dividend payout would be Rs. 37.71 million for the
year.
4. Consolidated Financial Statements and subsidiary
The Consolidated Financial statements have been prepared by the Company
in accordance with the applicable Accounting standards (AS-21, AS-23
and AS-27) issued by the Institute of Chartered Accountants of India
and the same together with the Auditor's Report thereon is provided
in the Annual Report.
The annual accounts of the subsidiary and related detailed information
will be kept at the Registered Office of the Company, will be available
to investors seeking information at any time.
The Company has adopted a Policy for determining Material Subsidiaries
in terms of Clause 49 of the Listing Agreement. The Policy, as approved
by the Board, is uploaded on the Company's website at the web link:
http:/
/www.centumindia.com/wp-content/uploads/2014/12/Policy-on-Material-Subsidiaries.pdf
5. Risk Management
Your Company has a robust Risk Management policy. Your Company
regularly assess the risks and ensures that the risk mitigation plans
are in place.
The web link for the Risk Management Policy is
http://www.centumindia.com/wp-content/uploads/2015/01/
Risk-Management-policy.pdf
6. Internal Control Systems and their adequacy
The Company has an Internal Control System, commensurate with the size,
scale and complexity of its operations. The Company has appointed
Ernst and Young LLP., as its Internal auditor. The Audit Committee
defines the scope and areas of internal audit. The Internal auditor
audits the areas recommended by the committee every year.
Significant audit observations and corrective actions thereon are being
presented to the Audit Committee of the Board. Based on the report of
Internal auditor, process owners undertake corrective action in their
respective areas and thereby strengthen the controls. During the year,
the internal audit was done on the areas recommended and no material
weakness was observed.
7. Directors and Key Managerial Personnel
The changes that had occurred in the composition of the Board of
Directors are given below:
i. In accordance with the provisions of Section 149 & 161 of the
Companies Act, 2013, Dr. Swarnalatha Mallavarapu was appointed as
Additional Director w.e.f. March 26, 2015 and will hold office until
the conclusion of the ensuing Annual General Meeting and being eligible
offer herself for appointment as a director.
ii. In terms of the provisions of Section 149(10) & (11) and other
applicable provisions, if any, of the Companies Act, 2013, Mr. Manoj
Nagrath, is eligible and qualified for the appointment as Independent
director. Your directors propose him for the appointment in terms of
the said regulations, for a period of 5 years.
iii. In terms of the provisions of Section 149(10) & (11) and other
applicable provisions, if any, of the Companies Act, 2013, Mr. Rajiv C
Mody, is eligible and qualified for the appointment as Independent
director. Your directors propose him for the appointment in terms of
the said regulations, for a period of 5 years.
None of the Directors of the company are disqualified for being
appointed as Directors in terms of Section 164 of the Companies Act,
2013.
The Appointments of the aforesaid directors have been included as an
item for each director in the notice convening the ensuing Annual
General Meeting.
All the Independent Directors have given declarations that they meet
the criteria of independence as laid down under Section 149 (6) of the
Act and Clause 49 of the Listing Agreement entered into with the Stock
Exchanges. In the opinion of the Board, they fulfill the conditions of
independence as specified in the Act and the Rules made there under and
are independent of the management.
Dr. Rama Rao, Director of the company has resigned w.e.f August 1,
2014.
Except the above, no other Director or Key Managerial Person has been
appointed or has retired or resigned during the year.
Separate meeting of Independent Directors
A separate meeting of Independent Directors of the Company, without the
attendance of Non-Independent Directors and members of management was
held during the year, as required under Schedule IV to the Companies
Act, 2013 and Clause 49 of the Listing Agreement. At the Meeting, the
Independent Directors:
- Reviewed the performance of Non-Independent Directors and the Board
as a whole;
- Reviewed the performance of the Chairman of the Company, taking
into account the views of Executive Director and Non-Executive
Directors; and
- Assessed the quality, quantity and timeliness of flow of
information between the Company management and the Board that is
necessary for the Board to effectively and reasonably perform their
duties.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual evaluation
of its own performance, the directors individually as well as the
evaluation of the working of its Audit and Nomination & Remuneration
committees.
Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Senior Management and their remuneration. The Nomination and
Remuneration Policy is attached to this report.
Meetings
A calendar of Meetings is prepared and circulated in advance to the
Directors.
During the year, four meetings of the Board of directors and four
meetings of the Audit Committee were convened and held. The details of
which are given in the Corporate Governance Report. The Intervening gap
between the meetings was within the period prescribed under the
Companies Act, 2013.
8. Directors Responsibility Statement
Pursuant to Section 134(3)(c) of the Companies Act, 2013, your
Directors confirm:
i. that in the preparation of annual accounts for the year ended March
31,2015, the applicable Accounting Standards have been followed along
with the proper explanations relating to material departures.
ii. that such accounting policies as mentioned in Note 2 of the Notes
to the Financial Statements have been adopted and applied consistently
and made judgments and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the Company as
at March 31, 2015 and of the profit of the Company for year ended on
that date.
iii. that proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Act for safeguarding the assets of the company and for preventing and
detecting fraud and other irregularities.
iv. that the annual financial statements have been prepared on a going
concern basis.
v. that proper internal financial controls were in place and that the
financial controls were adequate and operating effectively.
vi. that systems to ensure compliance with the provisions of all
applicable laws were in place were adequate and operating effectively.
9. Contracts and Arrangements with Related Parties
All related party transactions that were entered into during the
financial year were in the ordinary course of business and were at an
arm's length basis. There were no materially significant related
party transactions made by the company during the year with Promoters,
Directors, Key Managerial Personnel or other designated persons which
may have a potential conflict with the interest of the company at
large.
All the related party transactions were placed before the Audit
Committee as also the Board for approval. Prior omnibus approval of the
Audit Committee is being obtained for the transactions which are of a
foreseen and repetitive nature in terms of Clause 49 of the Listing
agreement.
The company has framed a policy on dealing with the related party
transactions and the same is uploaded on the company website.
Your directors draw attention of the members to Note 33 to financial
statements which sets out the related party disclosures.
10. Auditors Statutory auditors
M/s. BSR & Co. LLP (formerly known as M/s. BSR & Co.,), Chartered
Accountants, Statutory Auditors of the company will retire at the
forthcoming annual general meeting and are eligible for re-appointment.
The retiring auditors have furnished a certificate of their eligibility
under Sec 139 of the Companies Act, 2013 and the Rules framed
thereunder for the reappointment as Auditors of the company. Also as
required under Clause 49 of the Listing agreement, the auditors have
confirmed that they hold a valid certificate issued by the Peer Review
Board of the Institute of Chartered Accountants of India.
Secretarial audit
The Board has appointed Ms. Aarthi G Krishna, Practicing Company
Secretary, to conduct Secretarial Audit for the financial year 2014-15.
The Secretarial Audit Report for the financial year ended March 31,2015
is annexed herewith as Annexure V to this report.
11. Awards
Your company has received the below awards during the year under
review:
1. 'Excellence in Financial Reporting' for the year 2013-14 award
received from the Institute of Chartered Accountants of India (ICAI).
2. Three awards from ELCINA.
a. First prize for R & D in the large sector
b. First prize for Quality in the large sector; and
c. Special award for Exemplary Display of Business Excellence in the
large scale sector
3. Global Growth company award from the World Economic Forum.
4. Industry Excellence award - 2014 from the Institution of Engineers,
India (IEI).
12. Corporate Governance
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the company has complied with the requirements. The
Certificate on compliance of Corporate Governance requirements, issued
by the Statutory Auditors is annexed to the Report of Corporate
Governance.
13. Conservation of Energy, Technology absorption, Research &
Development and Foreign Exchange Earnings and Outgo.
The particulars prescribed under subsection (3) (m) of Section 134 of
the Companies Act, 2013 read Rule 8 of the Companies (Accounts) Rules,
2014, are given in the annexure - I attached to this report.
14. Particulars of Employees
The information pursuant to Section 197 of the Companies Act, 2013,
read with Rule 5 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, in respect of employees of the
company, will be provided upon request.
However, as per the provisions of Section 136 of the Act, the Report
and Accounts are being sent to the Members and others entitled thereto,
excluding the information on employees' particulars. The same is
available for inspection by the Members at the Registered Office of the
company during business hours on working days of the Company up to the
date of ensuing Annual General meeting. If any Member is interested in
obtaining a copy thereof, such Member may write to the Company
Secretary in this regard.
15. Particulars of Loans, Guarantees and Investments
The details of the investments made by the Company are in Note 11 of
the audited financial statements. The Company has not made any loans to
any persons within the meaning of Section 186 and has also not given
any guarantees within the meaning of that section.
16. Corporate Social Responsibility
As part of its initiatives under "Corporate Social Responsibility
(CSR), the Company has funded many projects that aid and improve
education, literacy and healthcare for children. It has also funded and
participated in projects that support and aid children with
disabilities. These projects are largely in accordance with Schedule
VII of the Companies Act, 2013.
The Annual Report on CSR activities is annexed herewith as "Annexure
- II".
17. Details of establishment of Vigil Mechanism
The Company has a Vigil mechanism to deal with the instances of fraud
and mismanagement, if any. The details of the Policy is explained in
the Corporate Governance Report and also posted on the website of the
company.
18. Prevention, Prohibition and Redressal of sexual harassment at work
place
The Company has zero tolerance for sexual harassment at workplace and
has formulated a Policy on Prevention, Prohibition and Redressal of
Sexual Harassment at the Workplace, in line with the provisions of the
Sexual Harassment of Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013 and the Rules there under. The Policy aims to
provide protection to employees at the workplace and prevent and
redress complaints of sexual harassment and for matters connected or
incidental thereto, with the objective of providing a safe working
environment, where employees feel secure.
The Company has also constituted an Internal Complaints Committee, to
inquire into complaints of sexual harassment and recommend appropriate
action.
The Company has not received any complaint of sexual harassment during
the financial year 2014-15.
19. Extract of Annual Return
The details forming part of the extract of the Annual Return in form
MGT 9 is annexed herewith as 'Annexure - III.
20. Management Discussion and Analysis
In compliance with the requirements of the listing agreement, a
detailed Management Discussion and Analysis Report giving details of
the company's business and operating results is given in annexure -
IV attached to this report.
21. Employee Stock Option Plan
As a measure of rewarding the employees, your company had introduced an
Employee Stock Option Plan (ESOP) during year 2007 & 2013.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee
Stock Option scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are given in the annexure - V attached to this report.
22. General
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions on these
items during the year under review:
a. Details relating to deposits covered under Chapter V of the
Companies Act, 2013.
b. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
c. Issue of shares (including sweat equity shares) to employees of the
company under any scheme save and except ESOP referred to in this
report.
d. There is no remuneration received by the Managing Director from the
subsidiary company.
e. No significant or material orders were passed by the regulators or
courts or tribunals which impact the going concern status and the
company's operations in future.
23. Human Resources
The human capital has been recognized as a vital factor in achieving
the goals and objectives of the organization. Emphasis is placed to
build a network of dedicated and experienced professionals who would
strive for organizational growth by maximizing the effectiveness while
the policies and practices would foster employees' satisfaction,
retention and productivity.
The company has initiated the talent development & management to
improve the productivity of the workforce. And the company hired the
services of Deloittee, the consulting company to help in this
endeavour.
24. Acknowledgements
Your Directors thank the customers for their continued patronage and
the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of
all the employees, who have demonstrated their skill, teamwork and
commitment through their competence, hard work, cooperation and
support.
Your Directors would also like to place on record the support received
from, the Electronic Hardware Technology Park, the Customs and Excise
Departments, the Reserve Bank of India, the Department of Industries
and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other
Central and State Governmental agencies.
for and on behalf of the Board
Place: Bangalore Apparao V Mallavarapu S. Krishnan
Date: May 27, 2015 Chairman & Managing Director Director
Mar 31, 2013
The Directors have pleasure in presenting their Twentieth Annual
Report on the business and operations of your Company and the audited
Statement of Accounts for the year ended 31st March 2013.
FINANCIAL HIGHLIGHTS Rs.Millions
CONSOLIDATED STANDALONE
Particulars 2012-13 2011-12 2012-13 2011-12
Revenue 2,835.13 2,585.38 1,824.11 1,826.00
Profit before
Depreciation and
Interest 345.65 324.05 24.89 183.25
Depreciation 154.95 147.05 75.82 74.66
Interest 41.67 43.28 27.76 31.81
Profit before tax 149.03 133.72 (78.69) 76.79
PERFORMANCE
During the current year of operations, your company has registered
consolidated revenue of Rs. 2,835.13 million, an increase of about 10%
compared to the previous financial year. Your company posted Profit
before Taxes of Rs. 149.03 million with an increase of 11% over the
previous financial year.
During the year, significant contributions were made in the Strategic
Electronic programs. The investments made in the global sales &
marketing initiatives have started to yield results during the year in
the form of new customers and new product introductions. These will
result in higher revenues in the coming years.
Your company has received the below awards during the year under
review:
1. Best Electronics Manufacturing Industry award for the year 2012
from the India Electronics and Semiconductor Association (IESA).
2. High Growth in Electronic Hardware exports award from the Soft
Technology Park of India (STPI).
SUBSIDIARY
During the Fifth year of operations, Centum Rakon India Private Limited
has registered revenue of Rs. 1078.73 million and posted Profit before
Taxes of Rs.227.82 million.
CONSOLIDATED FINANCIAL RESULTS
The Consolidated Financial statements have been prepared by the Company
in accordance with the applicable Accounting standards (AS-21, AS-23
and AS-27) issued by the Institute of Chartered Accountants of India
and the same together with the Auditor''s Report thereon form part of
the Annual Report.
HUMAN RESOURCES
The human capital has been recognized as a vital factor in achieving
the goals and objectives of the organization. Emphasis is placed to
build a network of dedicated and experienced professionals who would
strive for organizational growth by maximizing the effectiveness while
the policies and practices would foster employees'' satisfaction,
retention and productivity.
PARTICULARS OF EMPLOYEES
Information pursuant to Section 217(2A) of the Companies Act, 1956,
read with Companies (Particulars of Employees) Rules, 1975, forms part
of this Report. However, as per the provisions of Section 219(1
)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being
sent to the shareholders of the Company excluding the statement of
particulars of employees under Section 217(2A) of the Act. Any
shareholder interested in obtaining a copy of the statement may write
to the Company Secretary at the Registered Office address.
EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an
Employee Stock Option Plan (ESOP) during the year 2007.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee
Stock Option scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are given in the annexure included in this report.
DIRECTORS
The changes that had occurred in the composition of the Board of
Directors are given below:
Mr. Manny Marimuthu resigned as Director w.e.f. August 16, 2012.
In terms of the provisions of Section 256 and other applicable
provisions, if any, of the Companies Act, 1956, Mr. Rajiv C Mody,
Director, retires by rotation at the ensuing Annual General Meeting and
being eligible, offers himself for re-appointment. The particulars
relating to Mr. Rajiv C Mody are mentioned in the Report of Corporate
Governance. Your Directors recommend for the re-appointment of Mr.
Rajiv C Mody.
None of the Directors of the company are disqualified for being
appointed as Directors as specified in Section 274 of the Companies
Act, 1956.
The re-appointment of the aforesaid director have been included as an
item in the notice convening the ensuing Annual General Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of Companies (Amendment) Act, 2000, the
Directors confirm that:
i. in the preparation of annual accounts for the year ended 31st March
2013 all the applicable Accounting Standards had been followed along
with the proper explanations relating to material departures, if any;
ii. accounting policies were adopted and applied consistently and made
judgments and estimates that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company as at 31 st
March 2013 and of the profit or loss of the Company for year ended on
that date;
iii. proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the company and for preventing and detecting
fraud and other irregularities; and
iv. the Directors had prepared the annual accounts on a going concern
basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the company has complied with the requirements. The
Certificate on compliance of Corporate Governance requirements, issued
by the Statutory Auditors is annexed to the Report of Corporate
Governance.
AUDITORS
M/s BSR 8t Co., Chartered Accountants, Statutory Auditors of the
company will retire at the forthcoming annual general meeting and they
are eligible for re-appointment. Your Directors recommend the
re-appointment of the above Statutory Auditors and resolution in this
regard forms part of the agenda for the forthcoming Annual General
Meeting, requiring approval of the shareholders. The retiring auditors
have furnished a certificate of their eligibility for reappointment
under Sec 224 (1B) of the Companies Act, 1956 and have indicated their
willingness to continue.
MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of the listing agreement, a
detailed Management Discussion and Analysis Report giving details of
the company''s business and operating results is annexed to this report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH a DEVELOPMENT
AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (1) (e) of Section 217 of
the Companies Act, 1956 read with the companies (Disclosure of
particulars in the report of Board of Directors) Rules, 1988 are given
in the annexure included in this report.
ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and
the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of
all the employees, who have demonstrated their skill, teamwork and
commitment through their competence, hard work, cooperation and
support.
Your Directors would also like to place on record the support received
from, the Electronic Hardware Technology Park, the Customs and Excise
Departments, the Reserve Bank of India, the Department of Industries
and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other
Central and State Governmental agencies.
for and on behalf of the Board
Place: Bangalore Apparao V Mallavarapu Manoj Nagrath
Date: May 30, 2013 Chairman fit Managing Director Director
Mar 31, 2012
The Directors have pleasure in presenting their Nineteenth Annual
Report on the business and Operations of your Company and the audited
Statement of Accounts for the year ended 31st March 2012.
FINANCIAL HIGHLIGHTS
Rs.Millions
Year ended March 31 2012 2011
Revenue 1826.00 1892.46
Profit before Depreciation and Interest 183.26 171.16
Depreciation 74.66 74.04
Interest 31.81 31.45
Profit before tax 76.79 65.67
Proposed Dividend including distribution tax 14.37 14.40
PERFORMANCE
During the current year of operations, your company has registered
revenue of Rs. 1826.00 million and posted Profit before Taxes of Rs.
76.79 million.
During the year, your company received recognition for In-house R & D
from the Department of Scientific and Industrial Research, Government
of India. Also your company's subsidiary, Centum Rakon India Pvt Ltd
received the same recognition for In-house R & D in the month of April
2012 from the above said authority.
SUBSIDIARY
During the Fourth full year of operations, Centum Rakon India Private
Limited has registered revenue of Rs. 841.88 million and posted Profit
before Taxes of Rs. 56.34 million.
DIVIDEND
A dividend of Re.1 per share on the paid up share capital of the
company is recommended. The dividend payout is Rs. 12.37 million and
the tax on dividend for the year is Rs. 2.00 million.
CONSOLIDATED FINANCIAL RESULTS
The Consolidated Financial statements have been prepared by the Company
in accordance with the applicable Accounting standards (AS-21, AS-23
and AS-27) issued by the Institute of Chartered Accountants of India
and the same together with the Auditor's Report thereon form part of
the Annual Report.
FINANCIALS OF SUBSIDIARY COMPANY
The Board of Directors of your company, pursuant to Circular No:
51/12/2007-CL-III dt. February 8, 2011 issued by Ministry of Corporate
Affairs, has opted by passing a resolution at its meeting held on 25
May 2012, for not attaching the balance sheet and other documents of
the subsidiary, Centum Rakon India Private Limited.
However, the said documents shall be made available to shareholders of
the Company and the subsidiary company seeking such information at any
point of time. The annual accounts of the subsidiary company shall also
be kept for inspection by any shareholders at the registered office of
the Company at #44, KHB Industrial Area, Yelahanka New Town, Bangalore
-560106. The Company shall furnish a hard copy of details of accounts
of subsidiary to any shareholder on demand.
HUMAN RESOURCES
The human capital has been recognized as a vital factor in achieving
the goals and objectives of the organization. Emphasis is placed to
build a network of dedicated and experienced professionals who would
strive for organizational growth by maximizing the effectiveness while
the policies and practices would foster employees' satisfaction,
retention and productivity.
PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of the employees are to be annexed to
this Report. However, pursuant to Section 219(1)(b)(iv) of the said
Act, the Report and Accounts excluding the said information, are being
sent to all the member of the Company and others entitled thereto. Any
member interested in obtaining such particulars may write to the
Company Secretary at the Registered Office of the company.
EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an
Employee Stock Option Plan (ESOP) during year 2007.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee
Stock Option scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are given in the annexure included in this report.
DIRECTORS
There were no changes in the composition of the Board of Directors.
In terms of the provisions of Section 256 and other applicable
provisions, if any, of the Companies Act, 1956, M r. Manoj Nagrath,
Director, retires by rotation at the ensuing Annual General Meeting and
being eligible, offers himself for re-appointment. The particulars
relating to Mr. Manoj Nagrath are mentioned in the Report of Corporate
Governance. Your Directors recommend for re-appointment of Mr. Manoj
Nagrath.
None of the Directors of the company are disqualified for being
appointed as Directors as specified in Section 274 of the Companies
Act, 1956.
The required resolutions for re-appointment of the aforesaid director
have been included in the notice convening the ensuing Annual General
Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of Companies (Amendment) Act, 2000, the
Directors confirm that:
i. in the preparation of annual accounts for the year ended 31st March
2012 all the applicable Accounting Standards had been followed along
with the proper explanations relating to material departures, if any;
ii. accounting policies were adopted and applied consistently and made
judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company as at 31st
March 2012 and of the profit of the Company for year ended on that
date;
iii. proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the company and for preventing and detecting
fraud and other irregularities; and
iv. the Directors had prepared the annual accounts on a going concern
basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the company has complied with the requirements. The
Certificate on compliance of Corporate Governance requirements, issued
by the Statutory Auditors is annexed to the Report of Corporate
Governance.
AUDITORS
M/s BSR & Co., Chartered Accountants, Statutory Auditors of the company
will retire at the forthcoming annual general meeting and they are
eligible for re-appointment. Your Directors recommend the
re-appointment of the above Statutory Auditors and resolution in this
regard forms part of the agenda for the ensuing Annual General Meeting,
requiring approval of the shareholders. The retiring auditors have
furnished a certificate of their eligibility for reappointment under
Sec 224 (1B) of the Companies Act, 1956 and have indicated their
willingness to continue.
MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of the listing agreement, a
detailed Management Discussion and Analysis Report giving details of
the company's business and operating results is annexed to this report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT
AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (1) (e) of Section 217 of
the Companies Act, 1956 read with the companies (Disclosure of
particulars in the report of Board of Directors) Rules, 1988 are given
in the annexure included in this report.
ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and
the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of
all the employees, who have demonstrated their skill, teamwork and
commitment through their competence, hard work, cooperation and
support.
Your Directors would also like to place on record the support received
from, the Electronic Hardware Technology Park, the Customs and Excise
Departments, the Reserve Bank of India, the Department of Industries
and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other
Central and State Governmental agencies.
for and on behalf of the Board
Place: Bangalore Apparao V Mallavarapu S. Krishnan
Date : May 25, 2012 Chairman & Managing Director Director
Mar 31, 2011
The Directors have pleasure in presenting their Eighteenth Annual
Report on the business and Operations of your Company and the audited
Statement of Accounts for the year ended 31st March 2011.
FINANCIAL HIGHLIGHTS
Rs.Millions
Year ended March 31 2011 2010
Revenue 1892.46 1109.00
Profit before Depreciation
and Interest 171.18 94.64
Depreciation 74.04 75.28
Interest 31.47 16.21
Profit before tax 65.67 3.15
Proposed Dividend including
distribution tax 14.40 14.43
PERFORMANCE
During the current year of operations, your company has registered a
revenue of Rs. 1892.46 million and posted Profit before Taxes of Rs.
65.67 million.
During the year, significant contributions were made in the Strategic
electronic programs. The investments made in the global sales &
marketing initiatives have started to yielDresults during the year in
the form of new customers and new product introductions. These will
result in higher revenues in the coming years.
SUBSIDIARY
During the third full year of operations, Centum Rakon India Private
Limited has registered revenue of Rs. 729.47 million and posted Profit
before Taxes of Rs. 44.52 million.
DIVIDEND
A dividend of 10% on the paid up share capital of the company is
recommended. The dividend payout is Rs. 12.35 million and the tax on
dividend for the year is Rs. 2.05 million.
CONSOLIDATED FINANCIAL RESULTS
The Consolidated Financial statements have been prepared by the Company
in accordance with the applicable Accounting standards (AS-21, AS-23
and AS-27) issued by the Institute of Chartered Accountants of India
and the same together with the Auditors Report thereon form part of
the Annual Report.
HUMAN RESOURCES
The human capital has been recognized as a vital factor in achieving
the goals and objectives of the organization. Emphasis is placed to
build a network of dedicated and experienced professionals who would
strive for organizational growth by maximizing the effectiveness while
the policies and practices would foster employees satisfaction,
retention and productivity.
PARTICULARS OF EMPLOYEES
Information pursuant to Section 217(2A) of the Companies Act, 1956,
read with Companies (Particulars of Employees) Rules, 1975, forms part
of this Report. However, as per the provisions of Section 219
(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are
being sent to the shareholders of the Company excluding the statement
of particulars of employees under Section 217 (2A) of the Act. Any
shareholder interested in obtaining a copy of the statement may write
to the Company Secretary at the Registered Office address.
EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an
Employee Stock Option Plan (ESOP) during the previous year.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee
Stock Option scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are given in the annexure included in this report
DIRECTORS
There were no changes in the composition of the Board of Directors.
In terms of the provisions of Section 256 and other applicable
provisions, if any, of the Companies Act, 1956, Dr. P Rama Rao,
Director, retires by rotation at the ensuing Annual General Meeting and
being eligible, offers himself for re-appointment. The particulars
relating to Dr. P Rama Rao are mentioned in the Report of Corporate
Governance. Your Directors recommend for re-appointment of Dr. P Rama
Rao.
None of the Directors of the company are disqualified for being
appointed as Directors as specified in Section 274 of the Companies
Act, 1956.
The requireDresolutions for re-appointment of the aforesaid director
have been included in the notice convening ensuing Annual General
Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of Companies (Amendment) Act, 2000, the
Directors confirm that:
i. in the preparation of annual accounts for the year ended 31st March
2011 all the applicable Accounting Standards had been followed along
with the proper explanations relating to material departures, if any;
ii. accounting policies were adopted and applied consistently and made
judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company as at 31st
March 2011 and of the profit or loss of the Company for year ended on
that date;
iii. proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the company and for preventing and detecting
fraud and other irregularities; and
iv. the Directors had prepared the annual accounts on a going concern
basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the company has complied with the requirements. The
Certificate on compliance of Corporate Governance requirements, issued
by the Statutory Auditors is annexed to the Report of Corporate
Governance.
AUDITORS
M/s BSR & Co., Chartered Accountants, Statutory Auditors of the company
will retire at the forthcoming annual general meeting and they are
eligible for re-appointment. Your Directors recommend the
re-appointment of the above Statutory Auditors andresolution in this
regard forms part of the agenda for the forthcoming Annual General
Meeting, requiring approval of the shareholders. The retiring auditors
have furnished a certificate of their eligibility for reappointment
under Sec 224 (1B) of the Companies Act, 1956 and have indicated their
willingness to continue.
MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of the listing agreement, a
detailed Management Discussion and Analysis Report giving details of
the companys business and operating results is annexed to this report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT
AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (1) (e) of Section 217 of
the Companies Act, 1956 read with the companies (Disclosure of
particulars in the report of Board of Directors) Rules, 1988 are given
in the annexure included in this report.
ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and
the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of
all the employees, who have demonstrated their skill, teamwork and
commitment through their competence, hard work, cooperation and
support.
Your Directors would also like to place on record the support received
from, the Electronic Hardware Technology Park, the Customs and Excise
Departments, the Reserve Bank of India, the Department of Industries
and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other
Central and State Governmental agencies.
for and on behalf of the Board
Place: Bangalore Apparao V Mallavarapu S. Krishnan
Date: May 26, 2011 Managing Director Director
Mar 31, 2010
The Directors have pleasure in presenting their Seventeenth Annual
Report on the business and Operations of your Company and the audited
Statement of Accounts for the year ended 31st March 2010.
FINANCIAL HIGHLIGHTS
Rs.Millions
Year ended March 31 2010 2009
Revenue 1109.00 227.31
Profit before Depreciation and Interest 94.64 32.72
Depreciation 75.28 19.33
Interest 16.21 7.72
Profit before tax 3.15 5.67
Proposed Dividend including distribution tax 14.43 8.66
PERFORMANCE
During the current year of operations, your company has registered a
revenue of Rs.1109.00 million and posted Profit before Taxes of Rs.
3.15 million.
The Honourable High Court of Karnataka vide order dated July 16, 2010
approved the Scheme of Amalgamation of Solectron EMS India Limited with
the Company
As the Appointed Date as per the Scheme is April 1, 2009 the results
for the year 2009-10 includes the results of Solectron EMS India
Limited which has been amalgamated with the Company but the previous
years (2008-09) figures do not include the results of Solectron EMS
India Limited.
During the year, significant contributions were made in the Strategic
electronic programs. The investments made in the global sales &
marketing initiatives have started to yield results during the year in
the form of new customers and new product introductions. These will
result in higher revenues in the coming years.
SUBSIDIARY
During the second full year of operations, Centum Rakon India Private
Limited has registered revenue of Rs.533.87 million and posted Profit
before Taxes of Rs. 20.12 million.
DIVIDEND
A dividend of 10% on the paid up share capital of the company is
recommended. The dividend payout is Rs. 1,23,33,333 and the tax on
dividend for the year is Rs. 20,96,050
CONSOLIDATED FINANCIAL RESULTS
The Consolidated Financial statements have been prepared by the Company
in accordance with the applicable Accounting standards (AS-21, AS-23
and AS-27) issued by the Institute of Chartered Accountants of India
and the same together with the Auditors Report thereon form part of
the Annual Report.
HUMAN RESOURCES
The human capital has been recognized as a vital factor in achieving
the goals and objectives of the organization. Emphasis is placed to
build a network of dedicated and experienced professionals who would
strive for organizational growth by maximizing the effectiveness while
the policies and practices would foster employees satisfaction,
retention and productivity.
PARTICULARS OF EMPLOYEES
Information pursuant to Section 217(2A) of the Companies Act, 1956,
read with Companies (Particulars of Employees) Rules, 1975, forms part
of this Report. However, as per the provisions of Section 219
(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are
being sent to the shareholders of the Company excluding
the statement of particulars of employees under Section 217 (2A) of the
Act. Any shareholder interested in obtaining a copy of the statement
may write to the Company Secretary at the Registered Office address.
EMPLOYEE STOCK OPTION PLAN
As a measure of rewarding the employees, your company had introduced an
Employee Stock Option Plan (ESOP) during the previous year.
The particulars prescribed under Guideline 12.1 of the SEBI (Employee
Stock Option scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are given in the annexure included in this report
DIRECTORS
The Changes that had occurred in the composition of the Board of
Directors are given below:
Mr. Som Mittal resigned as Director w.e.f. December 14, 2009
Mr. Manoj Nagrath was appointed as an Additional director w.e.f.
January 5, 2010
Mr. Rajiv C Mody was appointed as an Additional director w.e.f. August
7, 2010
Mr. Manny Marimuthu was appointed as an Additional director w.e.f.
August 9, 2010
In terms of the provisions of Section 256 and other applicable
provisions, if any, of the Companies Act, 1956, Mr. S. Krishnan,
Director, retires by rotation at the ensuing Annual General Meeting and
being eligible, offers himself for re-appointment. The particulars
relating to Mr. S. Krishnan are mentioned in the Report of Corporate
Governance. Your Directors recommend for re-appointment of Mr. S.
Krishnan.
None of the Directors of the company are disqualified for being
appointed as Directors as specified in Section 274 of the Companies
Act, 1956.
The required resolutions for re-appointment of the aforesaid director
have been included in the notice convening ensuing Annual General
Meeting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217 (2AA) of Companies (Amendment) Act, 2000, the
Directors confirm that:
i. in the preparation of annual accounts for the year ended 31st March
2010 all the applicable Accounting Standards had been followed along
with the proper explanations relating to material departures, if any;
ii. accounting policies were adopted and applied consistently and made
judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company as at 31st
March 2010 and of the profit or loss of the Company for year ended on
that date;
iii.proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of this Act for
safeguarding the assets of the company and for preventing and detecting
fraud and other irregularities; and
iv. the Directors had prepared the annual accounts on a going concern
basis.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the company has complied with the requirements. The
Certificate on compliance of Corporate Governance requirements, issued
by the Statutory Auditors is annexed to the Report of Corporate
Governance.
AUDITORS
M/s BSR & Co., Chartered Accountants, Statutory Auditors of the company
will retire at the forthcoming annual general meeting and they are
eligible for re-appointment. Your Directors recommend the
re-appointment of the above Statutory Auditors and resolution in this
regard forms part of the agenda for the forthcoming Annual General
Meeting, requiring approval of the shareholders. The retiring auditors
have furnished a certificate of their eligibility for reappointment
under Sec 224 (1B) of the Companies Act, 1956 and have indicated their
willingness to continue.
MANAGEMENT DISCUSSION AND ANALYSIS
In compliance with the requirements of the listing agreement, a
detailed Management Discussion and Analysis Report giving details of
the companys business and operating results is annexed to this report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, RESEARCH & DEVELOPMENT
AND FOREIGN EXCHANGE EARNINGS AND OUTGO.
The particulars prescribed under subsection (1) (e) of Section 217 of
the Companies Act, 1956 read with the companies (Disclosure of
particulars in the report of Board of Directors) Rules, 1988 are given
in the annexure included in this report.
ACKNOWLEDGEMENTS
Your Directors thank the customers for their continued patronage and
the investors, bankers and vendors for their continued support.
Your Directors acknowledge and thank the invaluable contributions of
all the employees, who have demonstrated their skill, teamwork and
commitment through their competence, hard work, cooperation and
support.
Your Directors would also like to place on record the support received
from, the Electronic Hardware Technology Park, the Customs and Excise
Departments, the Reserve Bank of India, the Department of Industries
and Commerce, Karnataka, the Karnataka Udyog Mitra and all the other
Central and State Governmental agencies.
for and on behalf of the Board
Place: Bangalore Apparao V Mallavarapu S. Krishnan
Date: 12 August 2010 Managing Director Director
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