Mar 31, 2018
The Directors have pleasure in presenting the 33rd Annual Report and Audited Accounts for the year ended 31st March 2018.
1. Financial Highlights (on standalone basis)
(Rs. in lacs)
Particulars |
Year ended 31st March â18 |
Year ended 31st March â17 |
Total Income |
47877 |
40897 |
Profit before depreciation, exceptional items and taxes |
7681 |
5125 |
Less: Depreciation |
597 |
417 |
Profit before tax & exceptional items |
7084 |
4708 |
Less: Exceptional items |
- |
- |
Profit before tax |
7084 |
4708 |
Less: Taxation |
2074 |
1468 |
Profit after tax |
5010 |
3240 |
Add: |
||
Balance in statement of profit and loss including general reserve |
27062 |
25184 |
Total Comprehensive income available for appropriation |
32072 |
28424 |
Appropriations: |
||
Dividend and Dividend Distribution tax |
817 |
1362 |
Surplus carried forward |
31255 |
27062 |
2. Financial and Operational Performance
Your Companyâs sales has gone up as compared to the previous year by 29% in value terms. However, the total income had gone up by 17% due to transition to Goods and Services Tax regime. Profit before tax and exceptional items, has increased by around 49% over the previous year because of increased level of sales and profitable sales product mix and cost reduction in material cost despite increase in employee cost. Your company also increased production capacity in Pondy and Hosur units to meet out the higher demand from the customers and increased investments in R&D equipment to take care of technological change requirements.
3. Internal Financial Controls
Your Companyâs internal financial control system provides for well-documented policies and procedures that ensure orderly and efficient conduct of business, safeguarding of assets, detection and prevention of frauds and errors, adequacy and completeness of accounting records and timely preparation of reliable financial information.
4. Corporate Social Responsibility
Your Company has constituted the Corporate Social Responsibility Committee (CSR Committee) and laid down the CSR policy which is available on the Companyâs website.
During the year the Company had spent Rs.69.50 lacs which is the equivalent of 2% of average net profits for the immediate past three financial years, towards CSR activities through Swami Dayananda Educational Trust, an eligible institution undertaking project on activities listed in Schedule VII of the Companies Act, 2013.
The report on CSR activities is annexed to this report.
5. Subsidiary Company and Associate Company and the Consolidated Financial Statements
5.1 Subsidiary company
Your subsidiary company, PT Automotive Systems Indonesia, was started as a subsidiary of your company in Indonesia to manufacture and supply products to one of its major customers from India. However as the volumes did not reach the expected levels, your company meets the requirements of the customer from India itself. The approvals granted by the appropriate authorities of the Government of Indonesia are valid till 2020 by which time an appropriate decision will be taken.
5.2. Associate company
Synergy Shakthi Renewable Energy Private Limited (SSREPL) was not in operation during the financial year 2017-18 due to restrictions on sale of power to third parties, unviable tariff offered by TNEB and adverse changes in regulatory policies. As a result, the associate company incurred a loss of Rs 98.45 lacs as against a loss of Rs 541.90 lacs during the previous year. SSREPL along with the State Biomass Industry Association made representations to various arms of the government seeking changes in policies to support renewable power producers as these projects were set up to reflect commitment to the cause of sustainable and environment-friendly clean energy. The project also provided linkages with the agro-economy for promotion of social cause of rural development and employment avenues for local population.
Considering the avowed objective of the government to promote renewable energy in line with the global trends and the commitments made in the national energy mission, it was hoped that there would be favourable changes in the regulatory policies that would enable SSREPL to re-establish its operations on a viable scale. As the efforts taken in this direction have not borne fruits so far and considering the need to reflect the diminution in the value of investments due to non-operation of the plant, appropriate provision has been made in the accounts.
5.3. Consolidated financial statements
The Consolidated Financial Statements of the Company prepared in accordance with the provisions of Section 1 29 (3) of the Companies Act 2013 read with the Companies (Accounts) Rules, 201 4 and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 along with a separate statement containing salient features of the financial performance of the subsidiary / associate, in the prescribed format, form part of the Annual Report.
Pursuant to the provisions of Section 1 36 of the Companies Act, 2013, the audited financial statements of the subsidiary has been placed on the website of the Company at www.indianippon. com and the same will be made available to the shareholders on receipt of a request from them. This will also be available for inspection by the shareholders at the registered office of the company during the business hours.
6. Sub-division of face value of shares
The Board of Directors in their meeting held on 29th January, 201 8 recommended sub-division of face value of shares from Rs.10 per share to Rs.5 per share and the same was approved by the shareholders through postal ballot on 8th March, 2018 with consequential amendments to the Memorandum and Articles of Association.
7. Dividend
Your Company had declared and paid a first interim dividend of Rs.6 per share on the pre subdivision face value of Rs.10 per share, in the meeting of the Board of Directors held on 29th January 2018 absorbing a sum of Rs.678.64 lacs, besides dividend distribution tax of Rs.13815 lacs and a second interim dividend of Rs.3.50 per share, in the meeting held on 8th May, 201 8 on the subdivided share of face value of Rs.5 per share, absorbing a sum of Rs.791.75 lacs, besides dividend distribution tax of Rs.162.74 lacs. The total outgo due to dividend, with respect to financial year 2017-18, was Rs.1 771.33 lacs (Rs.1470.44 lacs towards dividend and Rs.300.89 lacs dividend distribution tax). The first interim dividend declared for the year 2017-18 was paid during the year and was reflected in the financial statements. The second interim dividend was paid after the end of financial year and hence will be reflected in the financial statements of 2018-19.
8. Public Deposits
Your Company has not accepted any deposits falling within the ambit of Section 73 or Section 76 of the Companies Act, 201 3 read with Companies (Acceptance of Deposits) Rules 2014.
9. Conservation of Energy, Technology Absorption and Foreign Exchange Outgo and Earnings
Details of Conservation of Energy, technology absorption and Foreign Exchange outgo and earnings are given as Annexure to the Report.
10. Particulars of Employees
T he information required under Section 1 97 of the Companies Act, 201 3 and Rule 5(2) made thereunder, as amended, is given in Annexure 2. In terms of first proviso to Section 136(1) of the Companies Act 2013, the Annual Report, excluding the aforesaid annexure is being sent to the shareholders of the company. The annexure is available for inspection at the registered office of the company during business hours and any shareholder interested in obtaining a copy of said annexure may write to the Company Secretary at the registered office of the company.
The Comparative Analysis of the remuneration paid to Directors and Key Managerial Personnel with the Companyâs performance is given in annexure to the Report.
11. Annual Return
Extract of Annual Return is given as annexure to the Report.
12. Corporate Governance
Pursuant to the Listing Regulations 2015, the âReport on Corporate Governanceâ is enclosed as annexure to this report. The certificates required from Managing Director on Compliance with the Code of Conduct and Business Ethics and Managing Director / CFO Certification are annexed to this report.
13. Directorsâ Responsibility Statement
As required under Section 134 (5) of the Companies Act, 2013, the Board of Directors hereby confirm: -
i. That in the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
ii. That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of the affairs of the Company at the end of the Financial Year and of the profit of the Company for that period;
iii. That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. That the Directors had prepared the Annual Accounts on a going-concern basis;
v. That the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;
vi. That the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
14. Directors & Key Managerial Personnel (KMP)
Mr. K Seshadri, resigned from the Board of Directors with effect from 29th January 2018 and in his place Ms. Priyamvada Balaji was appointed under Section 161 of the Companies Act, 2013 which is proposed for approval of members under Section 152 in the ensuing Annual General Meeting.
Mr. Tadaya Momose, will be retiring by rotation at the ensuing Annual General Meeting and is eligible for re-appointment.
A brief resume of Ms. Priyamvada Balaji and Mr. Tadaya Momose and other relevant information have been furnished in the Notice of the Annual General Meeting including the resolutions for the same. The Directors recommend these businesses for approval.
The Board wishes to place on record its appreciation of the contributions made by Mr. K Seshadri for the development of the Company during his long tenure as Director of the Company.
The term of appointment of Mr. Arvind Balaji Managing Director, was due for re-appointment and the shareholders approved his reappointment for a further period of five years with effect from 1st April, 2018 through postal ballot as recommended by the Nomination and Remuneration Committee and the Board of Directors.
Mr. Elango Srinivasan, Chief Financial Officer and Mr. S. Sampath, Company Secretary are KMPs in terms of Section 2(51) and Section 203 of the Companies Act 2013.
Mr. S Sampath, Company Secretary retired with effect from 8th May, 2018 and in his place Mr. G Venkatram (ACS No. A23989) was appointed with effect from the same date, as recommended by the Nomination and Remuneration Committee and approved by the Board of Directors.
14.1 Declaration by independent directors as required u/s 149:
At the Annual General Meeting held on 27th August 2014, M/s G Chidambar, V Balaraman, K G Raghavan, R Vijayaraghavan and Ms. Jayshree Suresh were appointed as independent directors not liable to retire by rotation, for a consecutive period of five years.
All Independent Directors have given declarations 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 SEBI (LODR) Regulations 2015.
14.2 Terms of appointment of independent directors of India Nippon Electricals Limited
T he terms of appointment of the Independent Directors are available on the website of the company viz., www.indianippon.com.
14.3 Number of meetings of the board
Five meetings of the Board were held during the year. For details of the meetings of the Board, please refer to the corporate governance report, which forms part of this report.
14.4 Board evaluation
The Nomination & Remuneration Committee (N&RC) of the company approved an evaluation policy which provides for evaluation of the Board, the Committees of the Board and individual Directors.
Pursuant to Schedule IV of the Companies Act 2013, the Independent Directors of the company met without the attendance of Non-independent Directors and members of management and reviewed
(i) the performance of non-independent Directors of the Board as a whole;
(ii) the performance of the Chairman of the Company; and
(iii) 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.
On the same day, the performance evaluation of the Independent Directors was also done by the entire Board excluding the Directors being evaluated and also of its own performance and that of its Committees and individual Directors.
14.5 Policy on directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of directors, key managerial personnel and other employees Summary of the Nomination and Remuneration Policy, which details the principles underlying Directors/ Key Managerial Personnel appointment, remuneration etc is presented as part of the Corporate Governance Report. The policy can be accessed at www.indianippon. com. Additional details including various ratios required under the Companies Act 2013 is given as separate annexure to this report.
15. Auditors
(i) Statutory Auditors
Pursuant to Section 139 of the Companies Act, 2013 and Rules made thereunder, M/S Deloitte, Haskins & Sells LLP, Chartered Accountants, were appointed for a period of five years from the conclusion of the 32nd Annual General Meeting held on 24th August 2017 until the conclusion of the forthcoming 37th Annual General Meeting subject to ratification by the members at every annual general meeting if so required under the Act.
(ii) Cost Auditor
Pursuant to the Companies (Cost Records and Audit) Rules, 201 4, the Company filed the Cost Audit Report, with the Ministry of Corporate Affairs, for the financial year 2016-17 in XBRL format.
Mr. K Suryanarayanan who was appointed as Cost Auditor for the financial year 2017-18 will be submitting his report within the time limit applicable under the Companies (Cost Record and Audit) Rules 2014.
The Board has re-appointed Mr. K Suryanarayanan as cost auditor for the financial year 2018-19 also and a remuneration of Rs.2.75 lacs has been fixed for the audit. The ratification of his remuneration is included as an item in the Notice of the Annual General Meeting as required under Section 148 (3) of the Companies Act 201 3 read with Rule 14 of the Companies (Audit and Auditors) Rules 2014.
(iii) Secretarial Auditor & the Secretarial Audit Report
Ms. B Chandra, Practicing Company Secretary was appointed as Secretarial Auditor by the Board of Directors for the financial year 201 718 whose report is annexed to this report. Ms. B Chandra, Practicing Company Secretary was re-appointed as Secretarial Auditor for carrying out the secretarial audit for the financial year 2018-19.
(iv) Qualification/reservation/adverse remark in Audit Report
There were no qualification / reservation / adverse remark in the Auditorâs Report or in the Secretarial Audit Report.
16. Particulars of contracts or arrangements with related parties
The Audit Committee accords omnibus approval to Related Party Transactions which are foreseen and repetitive in nature. The Audit Committee reviews, on a quarterly basis, the details of the Related Party Transaction entered pursuant to the aforementioned omnibus approval.
Consequent to the application of Indian Accounting Standards (IND AS), your Companyâs transactions with TVS Motor Company Limited had become a material related party transaction. Further, your Company envisages that transactions with certain other related parties may become material in the future taking into consideration the overall trajectory in two/ three wheeler business. Approval of the shareholders is being sought under Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 201 5 for the material Related Party Transactions and the proposal along with detailed explanatory statement is given as part of the Notice to Shareholders for the ensuing Annual General Meeting.
All the existing and proposed transactions with related parties are in the ordinary course of business and on armâs length basis and the details of âmaterialâ related party transactions are disclosed in form AOC-2 which is annexed to forms part of this report.
The Company has a policy on Related Party Transactions and the same is displayed on the Companyâs website viz., www.indianippon.com.
17. Particulars of loans, guarantees or investments u/s 186:
The company has not given any loans or guarantee as specified under Section 186 of the Companies Act 2013.
The details of investments are given in Note no 5 on Accounts for the financial year 2017-18. The same is within the prescribed limits under provisions of Section 186 of the Companies Act 2013.
18. Prevention of sexual harassment of women at workplace:
As per the requirements of the Sexual Harassment of women at workplace (Prevention, Prohibition & Redressal) Act 2013 and Rules made thereunder, your Company has constituted Internal Complaints Committee. During the year under review, your Company has not received any complaints of sexual harassment from any of the women employees of the Company.
19. Material changes and commitments
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year to which the financial statements relate and the date of the report.
20 . Acknowledgements
Your Directors wish to place on record their appreciation for the good work of all the employees of the Company.
Your Directors also acknowledge the continued support received from Lucas TVS Limited, Lucas Indian Service Ltd, Mahle Electric Drives Japan Corporation and also wish to thank the Governments at the Centre and in the States of Tamil Nadu, Haryana, Maharashtra and Puducherry, Bank of Baroda, ICICI Bank Ltd, Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time to time.
For and on behalf of the Board of Directors
Place : Chennai T K BALAJI
Date : 8th May 2018 DIN No.:00002010
Chairman
Mar 31, 2017
The Directors have pleasure in presenting the 32nd Annual Report and Audited Accounts for the year ended 31st March 2017
1. Financial Highlights
Rs. in Lakhs
Year ended 31st March ''17 |
Year ended 31st March ''16 |
|
Total Income |
40,792 |
38,847 |
Profit before depreciation, exceptional items and taxes Less: |
5,125 |
4,551 |
Depreciation |
417 |
418 |
Profit before tax & exceptional items |
4,708 |
4,133 |
Exceptional items |
- |
- |
Profit before tax |
4,708 |
4,133 |
Taxation |
1,468 |
1,075 |
Profit after tax |
3,240 |
3,058 |
Profit brought forward from previous year |
25,468 |
24,003 |
Other Comprehensive Income |
321 |
245 |
Dividends |
1131 |
1,527 |
Dividend distribution tax |
230 |
311 |
Transfer to general reserve & share capital |
- |
- |
Retained in profit and loss account |
27,668 |
25,468 |
2. Financial and Operational Performance
Your Company''s sales has gone up as compared to the previous year by 4% in value terms. Profit before tax and exceptional items, has increased by around 14.7% over the previous year because of increased level of sales and cost reduction in material cost despite increase in employee cost. Your company also increased production capacity in Pondy to take care of the higher demand from the customers.
3. Management Discussion and Analysis
a. Overall economic view:
Indian economy has witnessed good GDP growth up to 7.9% initially during the first half of FY17 by showing resilience amidst global economy challenges, decline in investments and increased protectionist measures. The current fiscal has also seen significant game changing activities like passing of GST Bill and Bankruptcy Code bills and demonetization. Repo rates have also fallen from 7.5% to 6.25% in Apr1 7 increasing the liquidity with banks and exchange rates were stable during the year. Demonetization impact set the clock back in terms of growth especially in two wheeler market where demand has contracted significantly in the last quarter as liquidity remained tight affecting the disposable cash. Customers followed wait and watch policy since elections in big states were around the corner. Exports had lethargic growth
b. Industry structure and developments:
While the industry enjoyed robust growth early in the year, a significant slowdown was noticed since the last quarter of last fiscal due to demonetization. The two wheeler industry recorded an overall growth of around 6% led by a 25% and 11 % growth in moped and scooter segment while motor cycle market remained flat and three wheeler registered negative growth of 16% compared to last year. Industry has witnessed negative growth of 6% in exports. Two wheeler industry growth shrank in the later part of the year and was significantly affected by weak rural demand after demonetization and changes in emission standards from BS III to BS IV during the last quarter.
c. Performance review:
Your company had a growth of around 42% in moped segment against industry growth of 25% mainly due to higher share of business from the various customers. Sales growth in motor cycle has also increased slightly better than the industry growth. However, growth in scooter segment is less than market growth. Your company was able to increase its market share by 1 % through planned readiness for launch of BSIV products and introduction of few electronic products. The direct sales to aftermarket also scaled a steady growth of around 20% by expanding the distributors network in North and East India markets. Exports also witnessed about 20% growth compared to last year.
d. Business outlook:
The measures taken by Govt. during last fiscal are expected to result in positive trend in the long term. Demonetization is expected to increase the liquidity among the public and in banking system helping to lower lending rates and lift economic activity. This will help your company to increase the sales from two wheeler market. Implementation of GST is expected to catapult GDP growth. Moderate inflation and with solid agricultural input from bumper harvests after drought last year will provide fillip. Economy is forecast to regain its momentum with GDP growth rising to 7.4% FY18 from 7.1% in last fiscal. Automotive two wheeler industry is expected to growth between 7~9% in current financial year.
Industry has never been more uncertain and globalization of the market and competition from global players continue to drive the industry. Disruptive technological changes, electronic manufacturing services and continuous up gradation of emission standards offer both the opportunities and challenges. Introduction of BS VI, Electric Vehicles are on the cards. Sharing and connected vehicles will dramatically change both the types of vehicles and how they are used. More digitalization in automotive industry gives us scope for further growth. Few existing products may be phased out in the medium term. Your company is technologically well geared and ready to take up the challenges and convert into business opportunity.
Your company is planning to focus more on new technology products such as ISG, Immobilizers, Instrument Clusters, Electronic Control Units, Electronic Fuel Injection system and Brushless Alternators in coming years. The company stands to gain from the improving economic environment and investing in technologies and delivering higher value to customers by enabling them to stay ahead of global competition.
Your company has commercialized new business of EGR controller and Throttle Position Sensor for a Diesel Engine manufacturer for Three wheeler and small commercial vehicle application. The company plans to expand its reach in aftermarket through introducing new products like smart sensor adding cost benefit to the customer. On the cost front, your company is taking aggressive cost reduction measures like e-auction for material procurement, cost benchmarking, low cost automation, productivity improvement initiatives to make its products more competitive.
Your company has received new business enquiries from reputed customers in USA. The company is also exploring business opportunities in Asia Pacific region which are at initial stages.
Kolhapur unit commenced its operations during the year
e. Human resources and industrial relations:
The long term wage settlement for Hosur and Rewari have been completed. Negotiations for Pondy are in advanced stages. The industrial relations in all the units of the company continue to be harmonious.
f. Risks and concerns:
Uncertain weather conditions continue to influence the rural demand. Similarly, rising trend in raw material prices in steel, copper and petroleum products result in increasing product costs. Minimum wages policy pushes the cost of operation up. It poses challenge to maintain the profitability as customers may not fully offset the cost escalations. Frequent changes in emission norms make the customer postpone their purchases and makes few existing products obsolete.
Your Company is focusing on development of newer range of products which offer customers good value propositions, improving productivity and cost reduction in every possible area of operation to protect the bottom line.
g. Risk management policy:
Your Company takes cognizance of each business risk and has a risk management plan and policy in line with the overall objectives of the Company. The Company tracks the ever changing business risks and evaluates their impact on business results. Mitigation plan and counter measures are prepared and monitored to keep the impact minimal. Your Company had also formulated Risk Management Policy to identify and address the various risks.
h. Internal control system and their adequacy:
Your Company views internal audit as a continuous process to keep the management regularly appraised on the existence, adequacy and effectiveness of the internal control systems/processes in the company.
Based on the annual review and feedback received from the units and statutory auditors, audit plan is prepared and updated every year and approved by the Audit Committee. Internal auditors independently verify and test the adequacy and operating effectiveness of internal control systems and this provides assurance to the Audit Committee of continued compliance. The internal audit reports are also shared with statutory auditors.
Your Company improves internal control systems and accuracy of information on costs in real time through the effective use of ERP system which will help to analyze and exercise better control.
i. Internal financial control:
The company has established internal financial framework including internal controls over financial reporting and anti-fraud framework. The framework is reviewed regularly by the management and strengthened, from time to time to ensure adequacy and effectiveness of internal financial controls.
4. Corporate Social Responsibility
Your Company has constituted the Corporate Social Responsibility Committee (CSR Committee) and laid down the CSR policy which is available on the Company''s website.
During the year the Company had spent Rs. 60 lakhs which is the equivalent of 2% of average net profits for the immediate past three financial years, towards CSR activities through Swami Dayananda Educational Trust, an eligible institution undertaking project on activities listed in Schedule VII of the Companies Act, 2013.
The annual report on CSR activities is annexed to this report as ''Annexure -5 ''
5. Subsidiary Company and Associate Company and the Consolidated Financial Statements
5.1 Subsidiary company
Your subsidiary company, PT Automotive Systems Indonesia, has been granted approval from the Capital Investment Coordinating Board (BKPM) on January 19, 2017 for a further period of three years to explore business opportunities. However as mentioned in the previous report, the manufacturers of two wheelers in that country have their own sources for the products in the subsidiary''s range of manufacture and it has been decided to take necessary steps to liquidate the subsidiary
5.2. Associate company
Synergy Shakthi Renewable Energy Private Limited (SSREPL) was not in operation during the financial year 2016-17 due to restrictions on sale of power to third parties, unviable tariff offered by TNEB and adverse changes in regulatory policies. As a result, the associate company incurred a loss of Rs. 661.33 lakhs as against a loss of Rs. 389.46 lakhs during the previous year. SSREPL along with the State Bio mass Industry association has made representations to various arms of the government seeking changes in policies to support renewable power producers as these projects were set up to reflect commitment to the cause of sustainable and environment-friendly clean energy. Considering the avowed objective of the government to promote renewable energy in line with the global trends and the commitments made in the national energy mission. It is hoped there will be favourable changes in regulatory policies in the future would enable SSREPL to reestablish operations on a viable scale. The project was aligned to government policy of clean environment and also through linkages SSREPL established over a period for promotion of social cause of rural development and employment.
In order to fund this as well as to enable SSREPL restart its operations on a viable mode, SSREPL has come up ''rights issue'' in the ratio of 2 shares for every one share held by its existing shareholders at the face value of Rs. 10/- each to revive the company repay the borrowings from banks and also to meet the working capital requirements. Your Company subscribed Rs.12 Crores for the ''rights issue'' proportionate to its existing holding of Rs. 6 Crores.
Financial position of the subsidiary and the associate company are provided in AOC-1 as required under Section 129 (3 ) of the Companies Act 2013 as part of the financial statements.
5.3. Consolidated financial statements
The Consolidated Financial Statements of the Company prepared in accordance with the provisions of Section 129 (3) of the Companies Act 2013 read with the Companies (Accounts) Rules, 2014 and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 along with a separate statement containing salient features of the financial performance of the subsidiary / associate, in the prescribed format form part of the Annual Report.
Pursuant to the provisions of Section 136 of the Companies Act, 2013, the audited financial statements of the subsidiary has been placed on the website of the Company at www.indianippon.com and the same will be made available to the shareholders on receipt of a request from them. This will also be available for inspection by the shareholders at the registered office of the company during the business hours.
6. Dividend
Your Company had paid two interim dividends of Rs.4 and Rs. 6 per share totaling to Rs.10 per share during the year. Your directors recommend consideration of the same as total dividend for the year. The total dividend for the year will absorb a sum of Rs. 1131.07 laksh besides an additional outgo on dividend distribution tax of Rs. 230.30 lakhs.
7. Public Deposits
Your Company has not accepted any deposits falling within the ambit of Section 73 or Section 76 of the Companies Act, 2013 read with Companies [Acceptance of Deposits] Rules 2014.
8. Conservation of Energy, Technology Absorption and Foreign Exchange Outgo and Earnings
Please refer to Annexure-1 to the Directors'' Report to the Shareholders.
9. Particulars of Employees
The information required under Section 197 of the Companies Act, 2013 and the rule 5(2) made there under, as amended, has been given in Annexure 2. In terms of first proviso to Section 136(1) of the Companies Act 2013, the Annual Report, excluding the aforesaid annexure is being sent to the shareholders of the company. The annexure is available for inspection at the registered office of the company during business hours and any shareholder interested in obtaining a copy of said annexure may write to the Company Secretary at the registered office of the company.
The Comparative Analysis of the remuneration paid to Directors and Key Managerial Personnel with the Company''s performance is given in Annexure 3.
10. Annual Return
Extract of Annual Return is given as Annexure 4 to this report
11. Corporate Governance
Pursuant to the Listing Regulations 2015, the ''Report on Corporate Governance'' is enclosed as part of this report.
A certificate from the Auditors of your Company regarding compliance of the conditions of the Corporate Governance as stipulated by the SEBI (LODR) Regulations 2015, is attached to this report as Annexure 6.
The certificates required from Managing Director / CFO, are also attached to this report.
12. Directorsâ Responsibility Statement
As required under Section 134 (5) of the Companies Act, 2013, the Board of
Directors hereby confirm:-
i. That in the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
ii. That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of the affairs of the Company at the end of the Financial Year and of the profit of the Company for that period;
iii. That the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. That the Directors had prepared the Annual Accounts on a going-concern basis;
v. That the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;
vi. That the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
13. Directors & Key Managerial Personnel (KMP)
Mr. . T. K. Balaji, will be retiring by rotation at the ensuing Annual General Meeting and is eligible for re-appointment. A brief resume of Mr. . T K Balaji and other relevant information have been furnished in the Notice of the Annual General Meeting including the resolution for his reappointment. The directors recommend his re-appointment.
Mr. . Arvind Balaj, Managing Director, Mr. . Elango Srinivasan, Chief Financial Officer and Mr. . S. Sampath, Company Secretary are KMPs in terms of Section 2(51) and Section 203 of the Companies Act 2013. There is no change in KMP during the year.
13.1 Declaration by independent directors as required u/s 149:
At the Annual General Meeting held on 27th August 2014, M/S G Chidambar, V Balaraman, K G Raghavan, R Vijayaraghavan and Ms. Jayshree Suresh were appointed as independent directors not liable to retire by rotation, for a consecutive period of five years.
All Independent Directors have given declarations 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 SEBI (LODR) Regulations 2015.
13.2 Terms of appointment of independent directors of India Nippon Electricals Limited
The terms of appointment is available on the website of the company viz., www. indianippon.com.
13.3 Number of meetings of the board
Five meetings of the Board were held during the year. For details of the meetings of the Board, please refer to the corporate governance report, which forms part of this report.
13.4 Board evaluation
The Nomination & Remuneration Committee (N&RC) of the company approved an evaluation policy which provides for evaluation of the Board, the Committees of the Board and individual directors.
Pursuant to Sch. IV of the Companies Act 2013, the independent directors of the company met without the attendance of non-independent Directors and members of management and reviewed
(i) the performance of non-independent Directors of the Board as a whole;
(ii) the performance of the Chairman of the Company; and
(iii) 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.
On the same day, the performance evaluation of the independent directors was also done by the entire Board excluding the directors being evaluated and also of its own performance and that of its committees and individual Directors.
14. Auditors
(i) Statutory auditors
Pursuant to Section 139 of the Companies Act, 201 3 and Rules made there under, M/s Brahmayya & Co., Chartered Accountants, were appointed for a period of three years from the conclusion of the 29th Annual General Meeting held on 27th August 2014 until the conclusion of the forthcoming 32nd Annual General Meeting thus concluding their term of appointment. The Board of Directors place on record its appreciation of the services rendered by M/S Brahmayya & Co. as statutory auditors of the Company since its inception.
The Audit Committee and the Board of Directors have recommended the appointment of M/S Deloitte, Haskins & Sells LLP (DHS LLP), Chartered Accountants (Firm Registration No. 117366W/W-100018) as the Statutory Auditors of the Company, subject to the approval of the shareholders. M/S Deloitte, Haskins & Sells LLP have consented to the said appointment and confirmed that in the event of their appointment it would be within the limits mentioned under the provisions of Section 1 41 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014.
M/S Deloitte, Haskins & Sells LLP, Chartered Accountants, will hold office as statutory auditors for the first term of five years from the conclusion of 32nd Annual General Meeting of the Company, subject to ratification of the appointment by members at every Annual General Meeting held during their tenure.
(ii) Cost auditor
Pursuant to the Companies (Cost Records and Audit) Rules, 2014, the Company filed the Cost Audit Report, with the Ministry of Corporate Affairs, for the financial year 2015-16 in XBRL format.
Mr. . K Suryanarayanan who was appointed as Cost Auditor for the financial year 2016-17 will be submitting his report within the time limit applicable under the Companies (Cost Record and Audit) Rules 2014.
The Board has re-appointed Mr. . K Suryanarayanan as cost auditor for the financial year 2017-18 also and a remuneration of Rs. 2.50 lakhs has been fixed for the audit. The ratification of his remuneration is included as an item in the Notice of the Annual General Meeting as required under Section 148 (3) of the Companies Act 2013 read with Rule 14 of the Companies (Audit and Auditors) Rules 2014.
(iii) Secretarial auditor & the secretarial audit report
Ms. B Chandra, Practicing Company Secretary was appointed as Secretarial Auditor by the Board of Directors for the financial year 2016-17 whose report is attached separately to this report (Annexure 7). Ms. B Chardra, Practicing Company Secretary was re-appointed as Secretarial Auditor for carrying out the secretarial audit for the financial year 2017-18.
(iv) Qualification/reservation/adverse remark in Audit Report
There were no qualification / reservation / adverse remark in the auditor''s report or in the secretarial audit report.
15. Particulars of contracts or arrangements with related parties
All the transactions with related parties are in the ordinary course of business and on arm''s length basis and there are no ''material'' related party transactions and thus disclosure in form AOC - 2 is not required.
15.1 Policy on related party transactions of the company
The Company has a policy on Related Party Transactions and the same is displayed on the Company''s website viz., www.indianippon.com.
16. Particulars of loans, guarantees or investments u/s 186:
The company has not given any loans or guarantee as specified under Section 186 of the Companies Act 2013.
The details of investments are given in Note no. 6 on Accounts for the financial year 2016-17. The same is within the prescribed limits under provisions of Section 186 of the Companies Act 2013.
17. Employee stock option:
There is no scheme of employees'' stock option in your Company.
18. Policy on directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes, independence of directors, key managerial personnel and other employees
The Board shall have minimum 3 and maximum 12 Directors.
The Nomination and Remuneration Committee of your Company has laid down criteria and qualification for appointment of Directors and Key Managerial Personnel. The person for such appointment should possess adequate qualification, expertise, experience and integrity.
The Managing Director of the Company is entitled to monthly remuneration and commission based on the profit computed in the manner prescribed under the Companies Act, 2013 and subject to the overall ceiling specified in Section 1 98 of the Act. All other Directors are entitled to sitting fees for attending the meetings of the Board of Directors and its Committees and also to commission based on the profit subject to the ceiling as specified in Section 198 of the Companies Act, 2013.
Some of the additional reports as required under the Companies Act 2013 and forming part of the Boards Report are attached to this report.
19. Prevention of sexual harassment of women at workplace:
As per the requirements of the Sexual Harassment of women at workplace (Prevention, Prohibition & Redressal) Act 2013 and Rules made there under, your Company has constituted Internal Complaints Committee. During the year under review, your Company has not received any complaints of sexual harassment from any of the women employees of the Company.
20. Material changes and commitments
There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year to which the financial statements relate and the date of the report.
21. Acknowledgements
Your Directors wish to place on record their appreciation for the good work of all the employees of the Company.
Your Directors also acknowledge the continued support received from Lucas Indian Service Ltd, Chennai, Mahle Electric Drives Japan Corporation, Japan and also wish to thank the Governments at the Centre and in the States of Tamil Nadu, Haryana, Maharashtra and Puducherry, Bank of Baroda, ICICI Bank Ltd, Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time to time.
For and on behalf of the Board of Directors
Chennai T K BALAJI
18th May 2017 DIN No.:00002010
Chairman
Mar 31, 2015
Dear Members,
The Directors have pleasure in presenting the Thirtieth Annual Report
and Audited Accounts for the year ended 31st March 2015.
1. FINANCIAL HIGHLIGHTS
Rs. Lacs
Year ended Year ended
31st March 15 31st March 14
Sales (Net of excise duty) 32653 26153
Profit before depreciation, 3962 3172
exceptional items and
taxes
Less:
Depreciation 775 562
Profit before tax & 3187 2610
exceptional items
Exceptional items - -
Profit before tax 3187 2610
Taxation 921 644
Profit after tax 2266 1966
Profit brought forward 1199 1181
from previous year (*)
Dividends 1018 1018
Dividend distribution tax 204 173
Transfer to general 900 750
reserve & share capital
Retained in profit and 1343 1206
loss account
(*) Consequent to the adoption of the revised estimates of useful life
of fixed assets as stipulated in Sch. II of the Companies Act, 2013,
with effect from 1st April 2014, an amount of Rs. 6.86 lacs arising out
of realignment with useful life as prescribed has been debited to the
opening balance of retaining earnings.
2. FINANCIAL AND OPERATIONAL PERFORMANCE
Your Company's sales has gone up as compared to the previous year by
24.9% in value terms. Profit before tax and exceptional items has
increased by around 22.1% over the previous year because of increased
level of sales and cost reduction initiatives undertaken. Your company
also increased production capacity in Rewari to meet the higher demand
from the customers.
4. SUBSIDIARY COMPANY AND ASSOCIATE COMPANY AND THE CONSOLIDATED
FINANCIAL STATEMENTS
4.1 Subsidiary Company
The subsidiary of your company, PT Automotive Systems Indonesia is
exploring various business opportunities in that country as it also has
a large two wheeler population and an appropriate decision will be
taken within the time granted by the Governmental authorities of
Indonesia. The Government authorities of Indonesia have given time till
March 2017 for the decision to be reached. The details relating to the
subsidiary have been provided in the prescribed form as part of the
accounts.
The annual accounts of the subsidiary company will be available at the
Registered office of the Company and of the subsidiary company
concerned, if any member or investor wishes to inspect them during the
business hours on any working day.
4.2 Associate Company
M/s Synergy Shakthi Renewable Energy Limited (SSREL), in which your
Company has made a strategic investment, reported a profit of Rs. 70.52
lacs for its financial year ended 31st March 2015 which has been
recognised appropriately in the consolidated accounts. During the year
under review, their plant generated 41.31 million units of power that
represented 53% PLF as against previous year's 72%. The drop is due to
temporary suspension of third party sales by the state utility during
the second quarter of the year account of partial withdrawal of power
cuts. SSREL also augmented its revenue by trading in Renewable Energy
Certificates (RECs) where the market under-performed due to ineffective
enforcement of Renewable Purchase Obligations (RPOs) by the regulatory
authorities. Based on the renewable energy sector's representations to
the Government and other regulatory agencies, it is hoped that
appropriate measures will be in place to provide a fillip to the REC
market with an effective enforcement of RPOs in the near future.
Financial position of the subsidiary and the associate company are
provided in AOC- 1 as required under Section 129 (3) of the Companies
Act 2013 as part of the financial statements.
4.3 Consolidated Financial Statements
The Consolidated Financial Statements of the Company prepared in
accordance with the provisions of Section 129 (3) of the Companies Act
2013 and relevant Accounting Standards issued by the Institute of
Chartered Accountants of India form part of the Annual Report.
5 DIVIDEND
Your Company had paid an interim dividend of Rs. 4.50 per share in the
month of Feb'15. A final dividend of Rs. 4.50 per share has been
recommended by the Board of Directors for approval of the shareholders.
If approved, the total dividend for the year will be Rs. 9 per
share absorbing a sum of Rs. 1017.97 lacs besides an additional outgo
on dividend distribution tax of Rs. 203.56 lacs.
6 PUBLIC DEPOSITS
Your Company has not accepted any deposits falling within the ambit of
Section 73 of the Companies Act, 2013 read with Companies [Acceptance
of Deposits] Rules 2014.
7 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO AND EARNINGS
Please refer to Annexure-1 to the Directors' Report to the
Shareholders.
8 PARTICULARS OF EMPLOYEES
The information required under Section 197 (12) of the Companies Act,
2013 and the rules made thereunder, as amended, has been given in
Annexure 2 appended hereto and forms part of this report.
The Comparative Analysis of the remuneration paid to Directors and Key
Managerial Personnel with the Company's performance is given in
Annexure 3.
9 ANNUAL RETURN
Extract of Annual Return is given as Annexure 4 to this report.
10 CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, the 'Report on
Corporate Governance' is enclosed as part of this report.
A certificate from the Auditors of Your Company regarding compliance of
the conditions of the Corporate Governance as stipulated by Clause 49
of the Listing Agreement is attached to this report as Annexure 6.
The certificates required from Managing Director / CFO, are also
attached to this report.
11. DIRECTORS' RESPONSIBILITY STATEMENT
As required under Section 134 (5) of the Companies Act, 2013, the Board
of Directors hereby confirm:-
i. That in the preparation of the Annual Accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
ii. That the Directors had selected such accounting policies and
applied them consistently and made judgments and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of the affairs of the Company at the end of the Financial Year and of
the profit of the Company for that period;
iii. That the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
iv. That the Directors had prepared the Annual Accounts on a
going-concern basis;
v. That the directors, had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively;
vi. That the directors had devised proper systems to ensure compliance
with the provisions of all applicable laws and that such systems were
adequate and operating effectively.
12. DIRECTORS
Mr. T K Balaji, who opted to retire by rotation in the Board meeting
held on 23rd May 2014 and Mr. K Seshadri, will be retiring by rotation
at the ensuing Annual General Meeting and are eligible for
re-appointment.
At the Annual General Meeting held on 27th August 2014 the members had
appointed the existing Independent Directors M/S K G Raghavan, V
Balaraman, G Chidambar, R Vijayaraghavan and Ms. Jayshree Suresh as
Independent Directors under the Act, each for a term of five years with
effect from that date.
All Independent Directors, on appointment, were issued letter of
appointment setting out the terms of appointment, duties, remuneration
etc which was acknowledged by them.
12.1 Declaration by Independent Directors as required u/s 149:
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149 of the
Companies Act, 2013 and Clause 49 of the listing agreement.
12.2 Terms of appointment of Independent Directors of India Nippon
Electricals Limited
The terms of appointment is available on the website of the company
viz., www. indianippon.com.
12.3 Number of meeting of the Board
Six meetings of the Board were held during the year. For details of the
meetings of the Board, please refer to the corporate governance report,
which forms part of this report.
12.4 Board Evaluation
The Nomination & Remuneration Committee (N&RC) of the company approved
an evaluation policy which provides for evaluation of the Board, the
Committees of the Board and individual directors.
Pursuant to Sch IV of the Companies Act 2013, the independent directors
of the company convened on 23rd March 2015 an exclusive meeting without
the attendance of non-independent Directors and members of management
to review.
(i) the performance of non-independent Directors and the Board as a
whole;
(ii) the performance of the Chairman of the Company; and
(iii) 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.
On the same day, the performance evaluation of the independent
directors was also done by the entire Board excluding the directors
being evaluated.
13. Variations in the market capitalisation of the Company, price
earnings ratio as at the closing date of the current financial year and
previous financial year:
Particulars 31st March 2015 31st March 2014 % change
Market capitalisation 476.18 226.21 110.50
(in Rs. crores)
Price Earnings Ratio 21.10 11.51 83.32
14. AUDITORS
(i) Statutory Auditors
Pursuant to Section 139 of the Companies Act, 2013 and Rules made
thereunder, M/s Brahmayya & Co., Chartered Accountants, were appointed
for a period of three years from the conclusion of the 29th Annual
General Meeting held on 27th August 2014 until the conclusion of the
32nd Annual General Meeting. Their continuation in the appointment is
placed for ratification in the ensuing Annual General Meeting as
required under the Act.
(ii) Cost Auditor
The Board of Directors on the recommendation of the Audit Committee has
appointed Mr. K Suryanarayanan as Cost Auditor for the financial year
2015- 16 and fixed his remuneration, as cost audit is applicable for
the products manufactured by the company vide notification dated 31st
December 2014 issued by the Ministry of Corporate Affairs, Govt. of
India. The ratification of his remuneration is included as an item in
the Notice of the Annual General Meeting as required under Section 148
(3) of the Companies Act 2013 read with Rule 14 of the Companies (Audit
and Auditors) Rules 2014.
(iii) Secretarial Auditor & the Secretarial Audit Report
Ms. B Chandra, Practicing Company Secretary was appointed as
Secretarial Auditor by the Board of Directors for the financial year
2014-15 whose report is attached separately to this report (Annexure 7)
(iv) Qualification/reservation/adverse remark in Audit Report
There were no qualification / reservation / adverse remark in the
auditor's report or in the secretarial audit report.
15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the transactions with related parties are in the ordinary course of
business and on arm's length basis and there are no 'material'
contracts or arrangements or transactions at arm's length basis and
thus disclosure in form AOC - 2 is not required.
15.1 Policy on Related Party Transactions of the Company
The Company has a policy on Related Party Transactions and the same is
displayed on the Company's website viz., www.indianippon.com.
16. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS U/S 186:
The Company has not given any loans or guarantee as specified under
Section 186 of the Companies Act 2013.
The investments made by the Company during the period 2014-15 are
depicted below. The same is well within the prescribed limits under
provisions of Section 186 of the Act.
S.no Loans, Guarantees & Investments Amount 60% of Paid
made in (In Rs.Lacs) up capital
and Free
Reserves
1 Investment in equity instruments 4632.06
2 Investments in bonds 2162.55
3 Investments in venture capital funds 627.58
4 Investments in mutual funds 6755.31
Total 14177.50 12652.31
S.no Loans, Guarantees & Investments 100% of Free Remarks
made in Reserves
1 Investment in equity instruments
2 Investments in bonds
3 Investments in venture capital funds
4 Investments in mutual funds
Total 19956.12
17. EMPLOYEE STOCK OPTION:
There is no scheme of employees' stock option in your Company.
18. Policy on Directors' Appointment and Remuneration including
criteria for determining qualifications, Positive Attributes,
Independence of Directors, Key Managerial Personnel and Other Employees
The Board shall have minimum 3 and maximum 12 Directors.
The Nomination and Remuneration Committee of your Company has laid down
criteria and qualification for appointment of Directors and Key
Managerial Personnel. The person for such appointment should possess
adequate qualification, expertise, experience and integrity.
The Managing Director of the Company is entitled to monthly
remuneration and commission based on the profit computed in the manner
prescribed under the Companies Act, 2013 and subject to the overall
ceiling specified in Section 198 of the Act. All other Directors are
entitled to sitting fees for attending the meetings of the Board of
Directors and its Committees and also to commission based on the profit
subject to the ceiling as specified in Section 198 of the Companies Act
2013.
Some of the additional reports as required under the Companies Act 2013
and forming part of the Directors Report are attached to this report.
19. ACKNOWLEDGEMENTS
Your Directors wish to place on record their appreciation for the good
work of all the employees of the Company.
Your Directors also acknowledge the continued support received from
Lucas Indian Service Ltd, Chennai, Kokusan Denki Co Ltd., Japan and
also wish to thank the Governments at the Centre and in the States of
Tamil Nadu, Haryana and Puducherry, Bank of Baroda, ICICI Bank Ltd,
Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time
to time.
For and on behalf of the Board of Directors
Bengaluru T K BALAJI
25th May 2015 Chairman
Mar 31, 2014
The Directors have pleasure in presenting the Twenty Ninth Annual Report
and Audited Accounts for the year ended 31st March 2014.
1. FINANCIAL HIGHLIGHTS
Lacs
Year ended Year ended
31st March
14 31st March
13
Sales (Net of excise duty) 26153 26802
Profit before depreciation 3172 4128
and taxes
Less:
Depreciation 562 613
Profit before tax 2610 3515
Taxation 644 78
Profit after tax 1966 2837
Profit brought forward 1181 1532
from previous year
Dividends 1018 1018
Dividend distribution tax 173 170
Transfer to general reserve 750 2000
& share capital
Retained in profit and loss 1206 1181
account
2. OPERATIONAL PERFORMANCE
Your Company''s sales during the year under review fell by 2.40%
compared to the previous year owing to adverse business conditions.
Your Company went for an aggressive price strategy to get enhanced
market share particularly for fly wheel magneto which coupled with the
loss of business of profitable electronic component due to changes in
the model of one of the major customers impacted the bottom line
significantly. Efforts at cost reduction which, by and large, went
according to the plan drawn up and restricting price increases to
suppliers helped to mitigate the impact on the company''s bottom line.
The tax incidence on the profit earned was more than the previous year
due to completion of the tax holiday period by one of the units of the
Company.
4. SUBSIDIARY COMPANY
The subsidiary of your company, PT Automotive Systems Indonesia has
been granted three more years time up to March 2017 to establish
manufacturing operations in Indonesia. Your Company is exploring
various business opportunities in that country as it has a large two
wheeler population and an appropriate decision will be taken within the
time granted by the Governmental authorities of Indonesia. The annual
accounts of the subsidiary company will be available at the registered
office of the Company and of the subsidiary company concerned, if any
member or investor wishes to inspect them during the business hours on
any working day.
5. ASSOCIATE COMPANY
M/s Synergy Shakthi Renewable Energy Limited (SSREL), in which your
Company has made a strategic investment, reported a profit of Rs.195.02
lacs for its financial year ended 31st March 2014 which has been
recognised appropriately in the consolidated accounts. SSREL continued
its focus on improving the capacity utilization of its power plant by
securing alternate sources of biomass and stepping up its operations by
addressing the plant issues. On the market front, the base was enlarged
by SSREL by targeting better realizations from short term open access
customers. SSREL also augmented its revenue by trading in Renewable
Energy Certificates (RECs) where the market under- performed due to
ineffective enforcement of Renewable Purchase Obligations (RPOs) by the
regulatory authorities. As the viability of the project is also
dependent upon the performance of the REC market, the industry
association is in continuous dialogue with the Government and the
regulators to address this need.
6. DIVIDEND
Your Company had paid an interim dividend of Rs. 4 per share in the month
of Feb''14. A further dividend of Rs. 5 will be paid in June ''14. The
total dividend of Rs. 9 per share is being treated as final dividend for
the year. The dividends will absorb a sum of Rs. 1017.97 lacs besides an
additional outgo on dividend distribution tax of Rs. 173 lacs.
7. PUBLIC DEPOSITS
Your Company has not accepted any deposits under Section 58A of the
Companies Act, 1956 read with Companies [Acceptance of Deposits] Rules
1975.
8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO AND EARNINGS
Please refer to AnnexureÂI to the Directors'' Report to the
Shareholders.
9. PARTICULARS OF EMPLOYEES
None of the employees is drawing remuneration in excess of the amounts
specified as per Section 217 (2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules 1975 as amended.
10. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, the ''Report on
Corporate Governance'' is enclosed as part of this report. A
certificate from the Auditors of your Company regarding compliance of
the conditions of the Corporate Governance as stipulated by Clause 49
of the Listing Agreement is attached to this report. The certificates
required from Head of Operations/ CFO, are also attached to this
report.
11. DIRECTORS'' RESPONSIBILITY STATEMENT Pursuant to the provisions
under Section 217(2AA) of the Companies Act, 1956 on the Directors''
Responsibility Statement, it is hereby confirmed:
a) that in the preparation of accounts for the financial year ended
31st March 2014 the applicable accounting standards have been followed.
b) that the Directors have selected the accounting policies and applied
them 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, at the end of the financial year under review and of
the Profit of the Company, for the year under review.
c) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
d) that the Directors have prepared the annual accounts for the year
ended 31st March 2014 on a ''going concern'' basis.
12. DIRECTORS
In terms of Section 149 read with Section 152 of the Companies Act
2013, Independent Directors can be appointed for a term upto five years
and they need not retire by rotation during their tenure. Accordingly,
resolutions are placed for consideration of the Members to appoint
independent directors for a term upto 5 years in the ensuing Annual
General Meeting (A.G.M.).
Mr T K Balaji, Chairman of the Company who was appointed as Director
not liable to retire by rotation in the A.G.M. held in 1987 has opted
to retire by rotation to fulfil the requirement of Section 149 read
with Section 152 of the Companies Act 2013. Mr. N S Murthy resigned
from the Board of Directors with effect from 29th October 2013 and Ms.
Jayshree Suresh was appointed as an independent Director with effect
from 26th March 2014 in the casual vacancy caused by his resignation.
Mr Y Tomita retires by rotation and does not seek re- election. Mr.
Tadaya Momose is being proposed for appointment as a Non- independent
Director liable for retirement by rotation. The Company has received
proposals for the above appointments from shareholders as required
under Section 160 of the Companies Act 2013.
The Board would like to place on record its appreciation of the
valuable contributions made by M/s N S Murthy and Y Tomita during their
tenure as Directors of the Company.
13. AUDITORS
M/s Brahmayya & Co., Chartered Accountants, retire at the conclusion of
the Annual General Meeting and are eligible for re-appointment.
14. COST AUDITORS
Mr. K Suryanarayanan who was appointed as cost auditor for the
financial year 2012-13 filed the cost audit report with the MCA within
the stipulated time. He was also re-appointed as Cost Auditor by the
Board of Directors, for the financial year 2013 -14 who will be
completing the cost audit for the year ended 31st March 2014 and file
the cost audit report before the due date.
15. GENERAL
Your Directors wish to place on record their appreciation for the good
work of all the employees of the Company. Your Directors also
acknowledge the continued support received from Lucas Indian Service
Ltd, Chennai, Kokusan Denki Co Ltd., Japan and also wish to thank the
Governments at the Centre and in the States of Tamil Nadu, Haryana and
Puducherry, Bank of Baroda, ICICI Bank Ltd, Axis Bank Ltd, and SIPCOT
for the assistance rendered by them from time to time.
For and on behalf of the
Board of Directors
Chennai T K BALAJI
23rd May 2014 Chairman
Mar 31, 2013
To the Shareholders
The Directors have pleasure in presenting the Twenty Eighth Annual
Report and Audited Accounts for the year ended 31st March 2013.
1. FINANCIAL HIGHLIGHTS
Rs.lacs
Year ended Year ended
31st March 2013 31st March 2012
Sales (Net of excise duty) 26802 26005
Profit before depreciation,
exceptional items and taxes 4128 4371
Less: Depreciation 613 528
Profit before tax &
exceptional items 3515 3843
Exceptional items 133
Profit before tax 3515 3976
Taxation 678 846
Profit after tax 2837 3130
Profit brought forward from
previous year 1532 785
Dividends 1018 1018
Dividend distribution tax 170 165
Transfer to general reserve
& share capital 2000 1200
Retained in profit and loss
account 1181 1532
2. FINANCIAL AND OPERATIONAL PERFORMANCE
Your Company''s sales grew by 3% over the previous year in value terms.
Profit before tax and exceptional items, as a percentage of sales,
dropped by around 1.70% over the previous year mainly, due to increase
in material and conversion costs given to suppliers not recouped, in
full by the customers. Metal prices were on the higher side in the
first half of the year resulting in higher material cost. Other
expenses were higher primarily due to higher fuel consumption arising
out of higher power cuts and higher expenses on new product tooling,
purchase of critical spares for plant and machinery, travel for
business development etc. Depreciation was more due to capacity
expansion in Hosur and Rewari units.
3. SUBSIDIARY COMPANY
Your company acquired land in Indonesia through its subsidiary company,
PT Automotive Systems Indonesia, with a view to establish manufacturing
operations to support TVS
Motors. However, as the volumes have not reached our expectations, we
cannot proceed with the same. Our current approvals are valid till
March 2014, by which time an appropriate decision will be taken.
The Ministr y of Corporate Affairs vide the General Circular
No.2/2011/circular no.5/12/2007-CL-III dated 8th February 2011 had
granted general exemption from the requirement of attaching the annual
report of subsidiary company, subject to fulfilment of conditions
stipulated in the circular. Your company has satisfied the conditions
stipulated in the circular and hence is entitled to the exemption.
The annual accounts of the subsidiary company will be available at the
registered office of the Company and of the subsidiary company
concerned, if any member or investor wishes to inspect them during the
business hours on any working day.
4. ASSOCIATE COMPANY
M/s Synergy Shakthi Renewable Energy Limited (SSREL), in which your
Company has made a strategic investment, improved its capacity
utilization during FY 2012-13 by procuring biomass through alternate
sources and stepping up its plant operations. The company enlarged its
customer base by targeting better realizations from short term open
access consumers. SSREL has also augmented its revenue by trading in
Renewable Energy Certificates (RECs) which showed buoyancy during the
first half of the year. With these measures, we are happy to report
that your investee Company has been able to achieve profits during the
year under review. Going forward, sourcing of biomass fuels of right
quality in required volumes at affordable cost would pose challenges.
During the current year, many State utilities have also not been
forthcoming in buying RECs from renewable energy generators. The
viability of the project is dependent upon support from realisation of
revenue through sale of RECs. This, in turn, is subject to effective
enforcement of renewable purchase obligations by the regulators. The
industry association is in continuous dialogue with the Government and
regulatory authorities on the matter, to address these issues.
6. DIVIDEND
Your Company had paid an interim dividend of Rs. 4.00 per share in the
month of Mar''13. A further dividend of Rs. 5.00 per share will be paid
in June ''13. The total dividend of Rs. 9.00 per share is being treated as
final dividend for the year. The dividends will absorb a sum of Rs.
1017.97 lacs besides an additional outgo on dividend distribution tax
of Rs.169.51 lacs.
7. PUBLIC DEPOSITS
Your Company has not accepted any deposits under Section 58A of the
Companies Act, 1956 read with Companies [Acceptance of Deposits] Rules
1975.
8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO AND EARNINGS
Please refer to AnnexureÂI to the Directors'' Report to the
Shareholders.
9. PARTICULARS OF EMPLOYEES
None of the employees is drawing remuneration in excess of the amounts
specified as per Section 217 (2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules 1975 as amended.
10.CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, the ''Report on
Corporate Governance'' is enclosed as part of this report.
A certificate from the Auditors of Your Company regarding compliance of
the conditions of the Corporate Governance as stipulated by Clause 49
of the Listing Agreement is attached to this report.
The certificates required from Head of Operations/ CFO, are also
attached to this report.
11.DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions under Section 217(2AA) of the Companies Act,
1956 on the Directors'' Responsibility Statement, it is hereby
confirmed:
a) that in the preparation of accounts for the financial year ended
31st March 2013 the applicable accounting standards have been followed.
b) that the Directors have selected the accounting policies and applied
them 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, at the end of the financial year under review and of
the Profit of the Company, for the year under review.
c) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
d) that the Directors have prepared the annual accounts for the year
ended 31st March 2013 on a ''going concern'' basis.
12.DIRECTORS
Mr. K Seshadri and Mr. KG Raghavan are retiring by rotation at the
ensuing Annual General meeting and being eligible offer themselves for
re-appointment. Mr. Arvind Balaji was appointed during the year as an
additional Director and he will be proposed for appointment as a
director not liable to retire by rotation at the ensuing Annual General
Meeting. Mr. Arvind Balaji, has also been appointed as a Whole-time
Director of the Company u/s 269 of the Companies Act, 1956 effective
1st April 2013. A separate resolution will be proposed for approval of
the aforesaid appointment at the ensuing Annual General Meeting.
Mr. RD Flint who also retires by rotation at the ensuing Annual General
meeting does not seek re-election.
The Board would like to place on record its appreciation of the
valuable contributions made by Mr. RD Flint during his tenure as
Director of the Company.
Mr. R Vijayaraghavan was appointed as an Additional Director who will
be proposed for appointment as a director liable to retire by rotation
at the ensuing Annual General Meeting.
13. AUDITORS
M/s Brahmayya & Co., Chartered Accountants, retire at the conclusion of
the Annual General Meeting and are eligible for re-appointment.
14. COST AUDITORS
Ministry of Corporate Affairs (MCA) issued an industry specific Cost
Audit Order vide No.52/26/CAB-2010 dated 24th January 2012, thereby
requiring all such companies, which are in the manufacturing activities
of automotive components to appoint a Cost Auditor for auditing the
cost accounting information effective 1st April 2012 for the financial
year 2012-13 and file a report with the Central Government on or before
30th September every year.
The Board of Directors have appointed Mr K Suryanarayanan, Practising
Cost Accountant, Chennai for carrying out the cost audit of the company
for the year 2012-13 and the cost audit report will be filed with the
MCA within the stipulated time.
15. GENERAL
Your Directors wish to place on record their appreciation for the good
work of all the employees of the Company.
Your Directors also acknowledge the continued support received from
Lucas Indian Service Ltd, Chennai, Kokusan Denki Co Ltd., Japan and
also wish to thank the Governments at the Centre and in the States of
Tamil Nadu, Haryana and Puducherry, Bank of Baroda, ICICI Bank Ltd,
Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time
to time.
For and on behalf of the Board of Directors
Chennai T K BALAJI
28th May 2013 Chairman
Mar 31, 2012
The Directors have pleasure in presenting the Twenty Seventh Annual
Report and Audited Accounts for the year ended 31st March 2012.
1. FINANCIAL HIGHLIGHTS
Rs lacs
Year ended Year ended
31st March 2012 31st March 2011
Sales (Net of excise duty) 26005 22885
Profit before depreciation,
exceptional items and taxes 4371 3750
Less:
Depreciation 528 415
Profit before tax &
exceptional items 3843 3335
Exceptional items 133 -
Profit before tax 3976 3335
Taxation 846 792
Profit after tax 3130 2543
Profit brought forward from
previous year 785 836
Dividends 1018 767
Dividend distribution tax 165 127
Transfer to general reserve
& share capital 1200 1700
Retained in profit and loss
account 1532 785
2. OPERATIONS
Your Company's sales grew by 14% over the previous year, from Rs 228.85
crores to Rs 260.05 crores. Profit before tax and exceptional items at
Rs 38.43 crores showed an improvement of 15% over the previous year.
4. INTERNATIONAL APPRECIATION
The 'smart regulator' developed through in- house R&D by your company
has won an award from a well known motorcycle maker from Japan, for
fuel efficiency. A certificate in appreciation of the development has
been given to the joint venture partner of your company, M/s Kokusan
Denki, acknowledging this development by your company in India. The
customer is also keen to promote the use of this regulator in its
products manufactured in other parts of the world.
5. PT AUTOMOTIVE SYSTEMS INDONESIA (PT ASI)
Your Company has obtained approval from the designated authorities at
Indonesia for extension of time by two more years for commencing
commercial production which is expiring in March 2014. Your Company is
continuing to explore various options and an appropriate decision will
be made.
The Ministry of Corporate Affairs viae its General Circular
No.2/2011/circular no.5/12/2007-CL-lll dated 8th February 2011 has
granted general exemption from the requirement of attaching the annual
report of subsidiary company subject to fulfilment of conditions
stipulated in the circular. Your company has satisfied the conditions
stipulated in the circular and hence is entitled to the exemption.
The annual accounts of the subsidiary company will be available at the
registered office of the Company and of the subsidiary company
concerned, if any member or investor wishes to inspect them during the
business hours on any working day.
6. ASSOCIATE COMPANY
As indicated in the last year's report, in the context of the growing
need to reduce dependence on conventional sources of energy and on
environmental grounds, the Central Government is accelerating
initiatives to promote use of renewable sources of energy from the
Twelfth Plan (2012- 17). Introduction of Renewable Purchase Obligation
(RPO) for industrial consumers and state distribution utilities
alongside Renewable Energy Certificates (REC) scheme for the renewable
power generators is a step in this direction. Mandatory compliance of
RPO commencing from FY 2011 -12 is expected to gather momentum in the
coming years. The Ministry of New and Renewable Energy is also in the
process of formulating a National Biomass Mission policy framework to
support biomass-based power generators on issues ranging from long term
fuel security to viable energy tariffs for this sector.
Synergy Shakthi Renewable Energy Limited (SSREL), in which your Company
has made a strategic investment, has gradually improved its capacity
utilization during the second half of the year under review by securing
alternate sources of biomass and fine tuning its operations. SSREL has
also received accreditation from the regulatory authorities for trading
in RECs to which it would be entitled based on energy sold to its
customers. Realization from en-cashing the certificates by sale to the
obligated entities is expected to support the long term viability of
your investee company.
7. DIVIDEND
Your Company had paid an interim dividend of Rs 4.00 per share in the
month of February '12, A further dividend of Rs 5 per share will be
paid in June '12. The total dividend of Rs 9 per share is being treated
as final dividend for the year. The dividends will absorb a sum of Rs
101 7,97 lacs besides an additional outgo on dividend distribution tax
of Rs 165.15 lacs.
8. BONUS SHARES
During the year, your Company issued and allotted 32,31,632 equity
shares of Rs 10/- each as bonus shares on 22nd September 2011 in the
ratio of 2 equity shares for every 5 equity shares held to the eligible
shareholders as on the record date i.e. 21 st September 2011 by
capitalizing an equivalent amount standing to the credit of the general
reserve account of the Company. As a result, the Company's share
capital now stands at Rs 11.31 crores. The said issue and allotment of
bonus shares was completed within the stipulated period of two months
of its declaration by the Board of Directors in terms of SEBI (Issue of
Capital and Disclosure Requirements) Regulations, 2009.
9. PUBLIC DEPOSITS
Your Company has not accepted any deposits under Section 58A of the
Companies Act, 1956 read with Companies [Acceptance of Deposits] Rules
1975.
10.CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO AND EARNINGS
Please refer to Annexure-I to the Directors' Report to the
Shareholders.
11. PARTICULARS OF EMPLOYEES
None of the employees is drawing remuneration in excess of the amounts
specified as per Section 21 7 (2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules 1975 as amended.
12.CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, the 'Report on
Corporate Governance' is enclosed as part of this report.
A certificate from the Auditors of your Company regarding compliance of
the conditions of the Corporate Governance as stipulated by Clause 49
of the Listing Agreement is attached to this report.
The certificate required from CEO/ CFO, is also attached to this
report.
13. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions under Section 217(2AA) of the Companies Act,
1956 on the Directors'
Responsibility Statement, it is hereby confirmed:
a) that in the preparation of accounts for the financial year ended
31st March 2012 the applicable accounting standards have been followed.
b) that the Directors have selected the accounting policies and applied
them 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, at the end of the financial year under review and of
the Profit of the Company, for the year under review.
c) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
d) that the Directors have prepared the annual accounts for the year
ended 31st March 2012 on a 'going concern' basis.
14. DIRECTORS
Mr. K Nakamura has resigned from the Board of Directors and Mr Y Tomita
has been inducted in the casual vacancy caused by his resignation
effective 1st June 2012. Mr Y Tomita, will be proposed for appointment
as a Director liable to retire by rotation in the ensuing Annual
General Meeting.
Mr. N S Murthy and Mr. G Chidambar are retiring by rotation at the
ensuing Annual General meeting and being eligible offer themselves for
re-appointment.
15. AUDITORS
M/s Brahmayya & Co., Chartered Accountants, retire at the conclusion of
the Annual General Meeting and are eligible for re-appointment.
16. GENERAL
Your Directors wish to place on record their appreciation for the good
work of all the employees of the Company.
Your Directors also acknowledge the continued support received from
Lucas Indian Service Ltd, Chennai, Kokusan Denki Co Ltd., Japan and
also wish to thank the Governments at the Centre and in the States of
Tamil Nadu, Haryana and Puducherry, Bank of Baroda, ICICI Bank Ltd,
Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time
to time.
For and on behalf of the Board of Directors
Chennai T K BALAJI
30th May 2012 Chairman
Mar 31, 2011
To the Shareholders
The Directors have pleasure in presenting the Twenty Sixth Annual
Report and Audited Accounts for the year ended 31st March 2011.
1. FINANCIAL HIGHLIGHTS
Rs. lacs
Year ended Year ended
31st March 31st March
2011 2010
Sales 22885 16908
(Net of excise duty)
Profit before depreciation
and taxes 3750 2934
Less:
Depreciation 415 357
Profit before tax 3335 2577
Taxation 792 585
Profit after tax 2543 1992
Profit brought forward from
previous year 836 4101
Dividends 767 606
Dividend distribution tax 127 101
Transfer to general reserve 1700 4550
Retained in Profit and Loss 785 836
Account
2. OPERATIONS
Your Company's sales grew by 35% over the previous year, from Rs.
169.08 crores to Rs.228.85 crores. Your Company achieved a double digit
growth, in value terms, in all vehicle segments and the business in
electronics more than doubled. Profit before tax at Rs.33.35 crores
showed an improvement of 29% over the previous year.
4. PT AUTOMOTIVE SYSTEMS INDONESIA (PT ASI)
As reported earlier, your Company has obtained approval from the
designated authorities at Indonesia for extension of time by two years
for commencing commercial production which is expiring in March 2012.
Your Company is continuing to explore various options and an
appropriate decision will be made.
Your Company has obtained approval from the Ministry of Corporate
Affairs, New Delhi vide letter no.47/102/2011-CL-lll dated 9th February
2011, in terms of Section 212 (8) of the Companies Act, 1956 exempting
it from attaching the annual report of its subsidiary company.
The annual accounts of the subsidiary company will be available at the
registered office of the Company and of the subsidiary company
concerned, if any member or investor wishes to inspect them during the
business hours on any working day.
5. SYNERGY SHAKTHI RENEWABLE ENERGY LTD
To promote sustainable economic development, the Government of India
has placed considerable emphasis on power generation out of renewable
resources. Reflecting our commitment to this cause, we have made an
investment in Synergy Shakthi Renewable Energy Limited (SSREL) which is
a project for producing power out of biomass. The company has now
completed one full year of operation. SSREL is, however, facing acute
shortage of biomass availability. As a result of overall economic
growth, a number of industries are competing to procure biomass not
only for power generation but also for other industrial purposes.
Consequently, SSREL along with other investors in the renewable energy
in Tamilnadu have been facing shortage of raw material coupled with the
rising cost of inputs, affecting their operations. Consequently,
despite growing demand for power, SSREL is unable to generate to its
full capacity and incurring some losses. In the near term, the company
is making determined efforts to find alternate sources of biomass. The
company is also planning to raise additional finance from other
strategic investors, The company has clearly a long-term potential
given the support that the renewable energy segment is poised to
receive from the government
6. DIVIDEND
Your Company had paid interim dividends of Rs.5.00, Rs.3.50 and Re.
1.00 per share in the months of Dec' 10, Mar' 11 and May' 11. The
total dividend of Rs.9.50 per share is being treated as final dividend
for the year. The dividends will absorb a sum of Rs.767.51 lacs
besides an additional outgo on dividend distribution tax of Rs. 127.15
lacs.
7. PUBLIC DEPOSITS
Your Company has not accepted any deposits under Section 58A of the
Companies Act, 1956 read with Companies [Acceptance of Deposits] Rules
1975.
8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO AND EARNINGS
Please refer to Annexure-I to the Directors' Report to the
Shareholders.
9. PARTICULARS OF EMPLOYEES
None of the employees is drawing remuneration in excess of the amounts
specified as per Section 217 (2A) of the Companies Act, 1956 read with
Companies [Particulars of Employees] Rules 1975 as amended,
10. CORPORATE GOVERNANCE
As required by Clause 49 of the Listing Agreement, the 'Report on
Corporate Governance' is enclosed as part of this report.
A certificate from the Auditors of your Company regarding compliance of
the conditions of the Corporate Governance as stipulated by Clause 49
of the Listing Agreement is attached to this report.
The certificates required from CEO/ CFO, are also attached to this
report.
11 .DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions under Section 217(2AA) of the Companies Act,
1956 on the Directors' Responsibility Statement, it is hereby
confirmed:
a) that in the preparation of accounts for the financial year ended 31
st March 2011 the applicable accounting standards have been followed.
b) that the Directors have selected the accounting policies and applied
them 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, at the end of the financial year under review and of
the profit of the Company, for the year under review.
c) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities.
d) that the Directors have prepared the annual accounts for the year
ended 31st March 2011 on a 'going concern' basis.
12.DIRECTORS
Mr H Nanjo has resigned from the Board of Directors and Mr M Namatame
has been inducted in his place effective 1st April 2011. Mr. M Namatame
will be proposed for appointment as a Director not liable to retire by
rotation in the ensuing Annual General Meeting. Mr K Nakamura, who was
appointed by the shareholders as a Director not liable to retire by
rotation in the Annual General Meeting held on 21 st August 2008 is
resigning with effect from 20th August 2011 as such non-retiring
Director and will be proposed for appointment as a Director liable to
retire by rotation in the ensuing Annual General Meeting.
Mr K G Raghavan and Mr V Balaraman are retiring by rotation at the
ensuing Annual General Meeting and being eligible offer themselves for
re-appointment.
13.AUDITORS
M/s Brahmayya & Co., Chartered Accountants, retire at the conclusion of
the Annual General Meeting and are eligible for re-appointment.
14.GENERAL
Your Directors wish to place on record their appreciation for the good
work of all the employees of the Company.
Your Directors also acknowledge the continued support received from
Lucas Indian Service Ltd, Chennai, Kokusan Denki Co Ltd., Japan and
also wish to thank the Governments at the Centre and in the States of
Tamil Nadu, Haryana and Puducherry, Bank of Baroda, ICICI Bank Ltd,
Axis Bank Ltd, and SIPCOT for the assistance rendered by them from time
to time.
For and on behalf of the Board of Directors
T K BALAJI
Chairman
Chennai 27.05.2011