Directors Report of Subros Ltd.
Mar 31, 2022
Your Directors are pleased to present the 37th Annual Report of the Company together with the audited financial statements for the year ended March 31, 2022.
|
Standalone |
Consolidated |
|||
|
Particulars |
Current Year 2021-22 |
Previous Year 2020-21 |
Current Year 2021-22 |
Previous Year 2020-21 |
|
(Rs. in Crores) |
||||
|
Revenue from operations (Net of excise duty) |
2238.64 |
1795.65 |
2238.64 |
1795.65 |
|
Other income |
9.92 |
10.31 |
9.54 |
10.31 |
|
Profit before depreciation, interest and tax |
158.65 |
164.09 |
158.27 |
164.09 |
|
Less: Financial Charges |
10.92 |
16.25 |
10.91 |
16.25 |
|
Less: Depreciation |
102.35 |
92.11 |
102.35 |
92.11 |
|
Add: Share of profits/loss of joint venture (equity method) |
- |
- |
0.29 |
0.68 |
|
Profit before Exceptional items |
45.38 |
55.73 |
45.30 |
56.41 |
|
Less: Exceptional items |
- |
- |
- |
- |
|
Net profit before Taxation |
45.38 |
55.73 |
45.30 |
56.41 |
|
Less: Tax |
12.80 |
9.02 |
12.80 |
9.02 |
|
Profit after Taxation |
32.58 |
46.71 |
32.50 |
47.39 |
|
Profit brought forward |
449.24 |
405.82 |
449.64 |
405.53 |
|
Profit available for appropriation |
474.68 |
449.24 |
476.78 |
449.64 |
The net revenue from operations for the financial year ended March 31, 2022 is Rs. 2238.64 Crores as against Rs. 1795.65 Crores in the previous financial year. However, the net profit before tax is Rs. 45.38 Crores as compared to Rs. 55.73 Crores in the previous financial year.
The second & third wave of Covid-19 pandemic, has led to shortage of semi-conductors, logistic issues and created economic disruption throughout the world including India. The Companyâs operations have been adversely impacted due to the consequent lockdowns announced by the State Governments due to which the operations were suspended for part of the first quarter and gradually resumed with requisite precautions.
The Company has considered the possible effects that may result from the pandemic relating to COVID-19 in the preparation of these financial statements for the year ended March 31, 2022. While assessing the carrying value of its assets and liabilities, the Company has considered internal and external information available, and based on such information and assessment, has concluded that no further adjustments are required to be made to these financial statements. However, given the evolving scenario and uncertainties with respect to nature and duration, the impact of the pandemic may differ from that estimated as at the date of approval of these financial statements. The Company will continue to closely monitor any material changes to future economic conditions.
The performance of the Company is also discussed in Management Discussion and Analysis, as stipulated under Regulation 34 of the Listing Regulations with the Stock Exchanges, which forms part of the Directorsâ Report.
EXTERNAL ENVIRONMENT AND ECONOMIC OUTLOOK
COVID-19 wave-2 had moderate impact on the Companyâs performance. Though there was one month of lock down applied variably in many parts of the country in the month of May, 2021, however, recovery was seen in passenger car segment in Q2, 2021-22 followed by demand pick up in truck segment as well. Semiconductor shortage was observed at most Passenger Vehicle OEMs and their production were not able to return to peak levels to meet rising customer demand due to increased preference for personal mobility in post pandemic period from Q2, 2021-22 onwards. Accordingly, the Company saw high variability and downward pressure on PV segment OEM demand. Extraordinary increase in commodity prices and imported container costs and their availability during the year did have pressure on companyâs cost. Truck segment has shown good demand in Q3 and Q4, 2021-22 and bus segment has shown demand uptick in Q4, 2021-22 after a gap of almost 2 years of pandemic. Demand for AC ambulances is continuing. Home AC segment demand pick up got impacted due to higher commodity prices, raw material availability and customer side demand fluctuations; but is expected to stabilize.
The semiconductor shortage would continue to impact in the passenger vehicle segment, and is expected to restrict OEM production in first two quarters of FY 2022-23,
though situation is likely to be better than FY 2021-22. Global pandemic and geo political events including lockdowns in China may restrict OEM production due to raw material availability, and needs to be watched for. Semiconductor situation is likely to improve towards Q3/ Q4, 2022-23 and is likely to help OEMs return to their peak production towards Q4, 2022-23. Truck segment is likely to show better growth whereas bus segment is likely to return to pre-pandemic levels by end of the FY 2022-23 due to opening of the schools and phased opening of offices and tourism sector, and these segments expected to better than FY 2021-22. The Company expects to begin supplies in Coach AC segment during this year after obtaining regulatory approval. Also split AC production would start in FY 2022-23. Commodity prices are likely to stabilize by Q2, 2022-23 but may continue to put pressure on costs.
EXPANSION AND FUTURE PROSPECTS
As the industry is growing sharply post Covid-19, the technology enhancement / transition and regulatory compliances which are being enforced by the Government agencies, your Company is gearing to meet these requirements. In line with these, the Company is planning for capacity enhancement at Chennai plant in view of new models launch plan by OEM''s along with capacity balancing activities across plants as a regular practice.
To improve margins and de-risking impact of economic factors, there is a continued focus on localization and cost optimization activities in all the product segments. The research and development activities are focussed on new product development and new technology product introduction in Electric & Hybrid vehicles, Passenger vehicles, Commercial vehicles, Off-road vehicles and product range expansion in Home AC and Railways segment. The Company has made long term strategy for upgrading the products to meet enhanced customer requirement for ICE engines and also to meet regulatory requirements. Electric vehicle thermal products are at advanced evaluation stage and these are expected to the introduced soon in the market. New business for upcoming models from various OEM''s, programs are progressing as per the milestones..
Your Company has earned a net profit (after tax) of Rs. 32.58 Crores as against Rs. 46.71 Crores in the previous year. The Board has recommended a dividend of Rs. 0.70 per share (35% on the face value of equity shares of Rs. 2 each) for the financial year ended March 31, 2022, as against Rs. 0.70 per share (35% on the face value of equity shares of Rs. 2 each) in the previous year.
The dividend, if approved by the Members at the ensuing Annual General Meeting, shall absorb a sum of Rs. 4.57 Crores.
The Dividend Distribution Policy of the Company is available on the Companyâs website at www.subros.com/investors. html
Your Company proposes to transfer Rs. 1.50 Crores to the General Reserve.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF THE REPORT
There were no material changes and commitments that affect the financial position of the Company subsequent to the date of financial statement.
During the year there is no change in the Capital Structure of your Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board expresses profound grief and sorrow on the sudden and untimely demise of Mr. Ramesh Suri, Chairman of the Company on 12th May, 2021. His demise is an irreparable loss to the Company. The Board expresses sincere gratitude and place on record sincere appreciation for the invaluable guidance and contribution made by him towards growth and development of the Company.
During the year under review the following changes took place in the Board and Key Managerial Personnel of your Company:
i. Late. Mr. Ramesh Suri ceased as Chairman & Wholetime Director with effect from May 12, 2021.
ii. Ms. Shradha Suri, Managing Director was re-designated as Chairperson & Managing Director with effect from May 26, 2021.
iii. Mr. Parmod Kumar Duggal was appointed as Chief Executive Officer of the Company with effect from April 1, 2021. Further, he was appointed as Whole-time Director designated as CEO of the Company with effect from August 5, 2021.
iv. Mr. Hemant Kumar Agarwal was appointed as Chief Financial Officer of the Company with effect from April 1, 2021.
v. Mr. Fumitaka Taki resigned as Alternate Director to Mr. Hidemasa Takahashi with effect from January 27, 2022.
vi. Mr. Yasuaki Matsunaga was appointed as Alternate Director to Mr. Hidemasa Takahashi with effect from January 27, 2022.
Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Kenichi Ayukawa, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. The brief resume of Mr. Kenichi Ayukawa as required under the Listing Regulations and Secretarial Standards is provided in the Notice of the 37th Annual General Meeting of the Company. The requisite resolution pertaining to the re-appointment appears at the respective item of the Notice along with the Statement and is recommended to the Members for approval.
Declaration from Independent Directors:
The Company has received necessary declaration(s) from all the Independent Director(s) of the Company as laid down under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria as laid down under Section 149(6) of the Companies Act, 2013 and the Listing Regulations.
The Board of Directors met six times during the financial year 2021-22, the details of which are given in the Corporate Governance Report which forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed under the Companies Act, 2013.
Policy on Directors'' Appointment and Remuneration:
The policy of the Company on Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes and other matters is available on the website www.subros.com/investors.html of the Company.
The Composition of Audit Committee of the Company is described in Corporate Governance Report as stipulated under Listing Regulations, which forms integral part of this Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under Section 134 (5) of the Companies Act, 2013, your Directors hereby confirm that:
a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) The Directors have prepared the annual accounts on a going concern basis;
e) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES AND JOINT VENTURES
DENSO Subros Thermal Engineering Centre India Private Limited, a Joint Venture, achieved revenue of Rs. 17.95 Crores during the FY 2021-22 as against Rs.18.6 Crores in the previous year. The Joint Venture achieved a profit of Rs. 1.11 Crores during the year as against Rs. 2.61 Crores in the previous year. Your Company is holding 26% shares in this Joint Venture.
The Company does not have any subsidiary.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Companies Act, 2013 and IND AS 110 - Consolidated Financial Statements read with IND AS 31 - Interest in Joint Ventures, your Directors have pleasure
in attaching the Audited Consolidated Financial Statements, which forms a part of this Annual Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO
The information in terms of Section 134(3)(m) of the Companies Act, 2013, read with relevant rules is annexed herewith as Annexure-1 and forms integral part of this report.
The Annual Return as on March 31, 2022, in terms of provisions of Section 134(3) and other applicable provisions of the Companies Act, 2013, read with Rules thereto is available on website of the Company www.subros.com/investors.html and forms integral part of this Annual Report.
AUDITORS AND AUDITORS'' REPORT
Statutory Auditors: M/s. Price Waterhouse Chartered Accountants LLP Chartered Accountants will hold office till the conclusion of the 37th Annual General Meeting. The Auditorsâ Report to the Members for the year under review does not contain any qualification, reservation or adverse remark. The observations of the Auditors and the relevant notes on accounts are self-explanatory and therefore do not call for any further comments.
As per the provisions of Section 139 of the Companies Act, 2013, the Board has recommended the re-appointment of M/s Price Waterhouse Chartered Accountants LLP Chartered Accountants as Statuary Auditors of the Company for the 2nd term of 5 years from the conclusion of the 37th Annual General Meeting (AGM) till the conclusion of 42nd AGM for approval of the Members.
Cost Auditors: The Company has re-appointed M/s. Chandra Wadhwa & Company, Cost Accountants, as Cost Auditors of the Company to conduct the audit of cost records maintained by the Company for the FY 2022-23 in accordance with Section 148(1) of the Companies at 2013. The ratification of remuneration payable to Cost Auditors for the FY 202223 is being sought from the Members of the Company at the ensuing Annual General Meeting.
Secretarial Auditors: The Company has re-appointed M/s. RSM & Co., Company Secretaries as Secretarial Auditors to conduct the audit of secretarial and related records of the Company for the FY 2022-23. The Secretarial Audit Report for the financial year ended March 31, 2022 is annexed as Annexure-2 and the same is self-explanatory. The said Secretarial Audit Report does not contain any qualification or adverse remark.
During the year under review, your Company has neither invited nor accepted any deposits from the Public.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
No significant material order was passed by the Regulators or Courts or Tribunals impacting the going concern status and Companyâs operations in future
The adequacy of internal Financial Controls is discussed in Management Discussion and Analysis, as stipulated under the Listing Regulations with the Stock Exchanges, which forms part of this Report.
LOANS, GUARANTEES OR INVESTMENTS
The Company has not given any inter- corporate loans and/or provided any guarantees. Details related to the investments made by the Company are given in Note 5(a)(ii) to the Standalone Financial Statement of the Company.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formulated a Corporate Social Responsibility (CSR) Policy to undertake CSR initiatives as specified in Schedule VII of the Companies Act, 2013. The Company has constituted a robust and transparent governance structure to oversee the implementation of CSR Policy, in compliance with the requirements of Section 135 of the Companies Act, 2013. The Annual Report on CSR activities is annexed as Annexure-3 and forms integral part of this report. This Policy is placed on the website of the Company www.subros.com/ investors.html.
The Company has a risk management policy and framework in place to ensure proper identification and treatment of risks. The identification and mitigation of strategic, business, operational and process risks are carried out for all functions. The key strategic risks along with mitigation plan are presented to the risk management committee on half-yearly basis. Few of such risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this Annual Report. The implementation of the ERM framework is continuously evolving and has progressed well during the financial year 2021-22.
In addition to the ongoing Risk Management activities, the Company has focused on reviewing and mitigating the Cyber Security related risk.
Pursuant to Section 177(9) of the Companies Act, 2013, the Company has established a Vigil Mechanism/ Whistle Blower Policy for directors, employees, suppliers, contractors and other stakeholders of the Company. The purpose and objective of this Policy is to cover serious concerns that would have a larger impact on image and values of the Company due to incorrect financial reporting or improper conduct. The Whistle Blower Policy has been placed on the website of the Company www.subros.com/investors.html.
The Statutory Auditors, Cost Auditors or Secretarial Auditors have not reported any frauds under Section 143(12) of the Companies Act, 2013 and rules made thereunder.
The Company has in place a Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Committee has been set up to redress complaints
received regarding sexual harassment. During the year the Company did not receive any complaint.
The Board of Directors has formulated a Related Party Transaction Policy for determining material related party transactions. The Related Party Transaction Policy is available on the website of the Company www.subros.com/ investors.html. A statement of all particulars of Contracts or Arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, is annexed as Annexure-4 and forms integral part of this Report.
The Equity Shares of your Company continue to be listed on BSE Limited (BSE), National Stock Exchange of India Limited (NSE) and Delhi Stock Exchange Limited (DSE). The listing fees for the year 2021-22 have been paid to the said stock exchanges except to DSE as Securities and Exchange Board of India has withdrawn the recognition granted to DSE on November 19, 2014.
In compliance with the provisions of the Companies Act, 2013, Listing Regulations and Guidance Note issued by SEBI the Board has formulated a framework, inter alia, for formal evaluation of its performance as well as that of its committees and directors.
In this regard the Board has, inter alia, carried out an annual evaluation of the performance of all the independent director(s). The Nomination & Remuneration Committee (âNRCâ), inter alia, reviewed the performance of directors and the Board as a whole and its committee(s). The Independent Directors, inter alia, reviewed performance of non-independent directors, the Board as a whole and its committees and assessed the quality, quantity and timeliness of flow of information between the Companyâs management and the Board.
The evaluation criteria of the performance of every director, Board & its committees included, inter alia, their structure/ composition, meeting attendance, expertise drawn from diverse domains banking, administration, strategic and technical and bring specific competencies relevant to the Companyâs business. The Board members participation and overall functioning was quite satisfactory and effective during the year under review. There are no specific observations on the Board evaluation carried out during the year as well as for the previous year.
ICRA has assigned / reaffirmed the Long Term Ratings as [ICRA] AA- âStableâ and for Short Terms Ratings as [ICRA] A1 âStableâ.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure-5 to this Report.
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure to this Report having regard to the provisions of the second proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the said statement of employees under Section 197(12) of Companies Act, 2013 is being sent to the Members of the Company. The said information is available for inspection at the registered office of the Company during working hours and any Member interested in obtaining said statement may write to the Company Secretary at the registered office of the Company.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
The Company is committed to maintain the highest standards of corporate governance. The Company has complied with the corporate governance requirements, as stipulated under the Listing Regulations. A report on Corporate Governance along with a certificate from the Practicing Company Secretaries regarding compliance on the conditions of corporate governance prescribed under Listing Regulations is annexed herewith and forms integral part of this Report. All Policies of the company are available on the website of the Company www.subros.com/investors.html.
BUSINESS RESPONSIBILITY REPORT
A report on adoption of responsible business practices in the interest of the social, governance and environmental perspective are as vital as their financial and operational performance. Conforming to the requirements of the clause (f) of sub-regulation (2) of Regulation 34 of Securities and Exchange Board of India the Business Responsibility Report for Financial Year 2021-22 is annexed herewith and forms integral part of this Report.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
The disclosure of IEPF related activities during the year under review forms a part of the report on Corporate Governance
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India on meetings of Board of Directors, its Committee(s) and General Meetings.
Your Board wishes to convey its appreciation to all the employees for their enormous efforts as well as their collective contribution to the Companyâs performance. Your Board acknowledges with gratitude the co-operation and support extended by Companyâs bankers, HDFC Bank, State Bank of India, Kotak Mahindra Bank & other Banks and our collaborators, DENSO Corporation, Japan and Suzuki Motor Corporation, Japan for their continued support. Your Board also take this opportunity to convey heartfelt gratitude to the Companyâs valued customers, particularly Maruti Suzuki India Limited, Tata Motors Limited, Mahindra & Mahindra Limited, Renault Nissan Automotive India Pvt. Ltd and Force Motors Limited, for the trust and confidence reposed by them in the Management for their copious co-operation and support provided to the Company.
Last but not the least the Board wishes to thank all Members, vendors and business associates for their trust and constant support to the Company.
For and on behalf of the Board of Directors
SHRADHA SURI Chairperson & Managing Director (DIN: 00176902)
Place: New Delhi Dated: May 24, 2022
Mar 31, 2018
Dear Members,
The Directors are pleased to present the 33â Annual Report of the Company together with the audited financial statements for the year ended March 31, 2018.
FINANCIALRESULTS
|
PARTICULARS |
Standalone |
Consolidated |
||
|
Current year 2017-18 (Rs. in Lakhs) |
Previous year 2016-17 (Rs. in Lakhs) |
Current year 2017-18 (Rs. in Lakhs) |
Previous year 2016-17 (Rs. in Lakhs) |
|
|
Revenue from operations (Net of excise duty) |
191289 |
153493 |
191289 |
153492 |
|
Other income |
743 |
728 |
738 |
727 |
|
Profit before depreciation, interest and tax |
21741 |
17503 |
21724 |
17491 |
|
Less: Financial Charges |
4121 |
4791 |
4121 |
4791 |
|
Less: Depreciation |
9200 |
8791 |
9200 |
8791 |
|
Add: Share of profits of joint venture (equity method) |
- |
- |
11 |
2 |
|
Profit before Exceptional items |
8420 |
3921 |
8414 |
3911 |
|
Less: Exceptional Items |
182 |
3103 |
182 |
3103 |
|
Net profit before Taxation |
8238 |
818 |
8232 |
808 |
|
Less: Tax |
2176 |
-515 |
2176 |
-510 |
|
Profit after Taxation |
6062 |
1333 |
6056 |
1318 |
|
Profit brought forward |
21755 |
21178 |
21701 |
21156 |
|
Profit Available for appropriation |
26051 |
21755 |
25988 |
21701 |
BUSINESS OPERATIONS
The net revenue from operations (net of excise duty) for the financial year ended March 31, 2018 at Rs. 1913 crores was higher by 24.63% over the previous year (Rs. 1,535 crores in financial year ended March 31, 2017). In line with Companyâs growth plans, there is continued focused approach towards building additional capacities, introduction of efficient technologies in manufacturing process, new product development and localization.
With the concerted efforts of the Company, the Manesar Plant has been fully reinstated and is operational after the fire incident. An interim claim amount has been received from the insurance company and the final claim is under settlement.
The performance of the Company is also discussed in Management Discussion and Analysis, as stipulated under Regulation 34 of the Listing Regulations with the Stock Exchanges, which forms part of the Directorsâ Report.
EXPANSION AND FUTURE PROSPECTS
The Company is setting-up a greenfield plant in Gujarat to meet supplies to the Suzuki Motor Gujarat Pvt Ltd. The Company expects growth in coming years due to increased share of business from its existing customers and expansion of business in new domains like commercial vehicles, bus and rail air-conditioning.
DIVIDEND
Your Company has earned a net profit (after tax) of Rs. 60.62 crores as against Rs. 13.33 crores in the previous year. The Board has recommend a dividend of Rs. 1.10 per share (55% on the face value of equity shares of Rs. 2 each) for the financial year ended March 31, 2018 as against Rs. 0.50 per share (25% on the face value of equity shares of Rs. 2 each) in the previous year. The dividend, if approved by the Members at the ensuing Annual General Meeting, shall absorb a sum of Rs. 794.20 Lakhs (approx), including dividend tax.
TRANSFER TO RESERVES
Your Company proposes to transfer Rs. 150 Lakhs to the General Reserve and Rs.1250 Lakhs to the Debenture Redemption Reserve.
EVENTSSUBSEQUENTTOTHEDATEOFFINANCIAL STATEMENTS
There were no material changes and commitments that affect the financial position of the Company subsequent to the date of financial statement.
DIRECTORSAND KEY MANAGERIAL PERSONNEL
(i) During the year under review Mr. Hanuwant Singh, Independent Director passed away on June 30, 2017 and the Board deeply mourns this irreparable loss.
(ii) Pursuant to the provisions of Section 152 of the Companies Act, 2013 Dr. Jyotsna Suri, Non Executive Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers herself for reappointment. The brief resume of Dr. Jyotsna Suri as required under the Listing Regulations is provided in the Notice of the 33â Annual General Meeting of the Company. The requisite resolution pertaining to the reappointment appears at the respective items of the Notice along with the Statement and is recommended to the Members for approval.
(iii) Declaration from Independent Director: The Company has received necessary declaration(s) from all the Independent Directors of the Company as laid down under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria as laid down under Section 149(6) of the Companies Act, 2013 and the Listing Regulations.
(iv) Board Evaluation: In compliance with the provisions of the Companies Act, 2013, the Board has formulated a framework, inter alia, for a formal mechanism of evaluation of its performances as well as that of its committees and Directors, including the Chairman of the Board. The Nomination & Remuneration Committee (NRC) has approved the formats for the evaluation of the Board, Directors and Chairman of the Company considering qualification, expertise, attributes and various parameters based on which evaluation of the Board has to be carried out by the Company. There are no specific observations on the board evaluation carried out during the year as well as for the previous year. However, the Members of the NRC noted the exceptional sagacity shown by Mr. Ramesh Suri, Chairman relating to the reinstatement of the Manesar Plant after the fire mishap had fully gutted it. The Members of NRC also unanimously commended the performance of Ms. Shradha Suri, Managing Director in providing guidance and directions during the fire crisis in the Manesar Plant and re-instating within the shortest possible time.
(v) Board Meeting: The Board of Directors met five times during the financial year 2017-18, the details of which are given in the Corporate Governance Report which forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed under the Companies Act, 2013.
(iv) Policy on Directorsâ appointment and remuneration: The policy of the Company on Directorsâ appointment and remuneration including criteria for determining qualifications, positive attributes and other matters are available on the website (www.subros.com/investors) of the Company.
AUDIT COMMITTEE
The Composition of Audit Committee of the Company is described in Corporate Governance Report as stipulated under Listing Regulations, which forms part of this Report.
DIRECTORSâ RESPONSIBILITY STATEMENT
As required under Section 134 (5) of the Companies Act, 2013, your Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
(c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) The Directors have prepared the annual accounts on a going concern basis;
(e) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES AND JOINT VENTURES
Thai Subros Limited, the subsidiary company in Thailand, did not have any business operations during the year and incurred a loss of THB 8.62 Lakhs as against THB 6.73 Lakhs. As the business of the subsidiary is not forthcoming, the Board has approved the closure of Thai Subros Limited.
Denso Subros Thermal Engineering Centre India Limited, a Joint Venture, achieved consistent revenue of Rs. 1557 Lakhs. The Company earned a marginal increase in profit aftertax at Rs. 41.25 Lakhs during the year as against profit of Rs.7.34 Lakhs in the previous year. Your Company is holding 26% share in this Joint Venture.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Companies Act, 2013 and IND AS 110 - Consolidated Financial Statements read with IND AS 31 - Interest in Joint Ventures, your Directors have pleasure in attaching the Audited Consolidated Financial Statements, which formsa partofthisAnnual Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO
The information in terms of Section 134(3)(m) of the Companies Act, 2013 read with relevant rules is annexed herewith as Annexure-1 and forms integral part ofthis report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of annual return in Form MGT-9, is annexed as Annexure-2 to this report and forms integral part ofthis Report.
AUDITORS AND AUDITORâS REPORT
Statutory Auditors: M/s Price Waterhouse Chartered Accountants LLP, Chartered Accountants, hold office until the conclusion of the 37th annual general meeting. The Auditorsâ Report to the Members for the year under review does not contain any qualification, reservation or adverse remark. The observations of the Auditors and the relevant notes on accounts are self-explanatory and therefore do not call for any further comments.
Cost Auditors: The Company has re-appointed M/s. Chandra Wadhwa & Company, Cost Accountants, as Cost Auditors of the Company to conduct the audit of cost records maintained by the Company for the financial year 2018-19. The ratification of remuneration payable to Cost Auditors for the financial year 2018-19 is being sought from the Members of the Company at the ensuing Annual General Meeting.
Secretarial Auditors: The Company has re-appointed M/s. RSM & Co., Company Secretaries as Secretarial Auditors to conduct the audit of secretarial and related records of the Company for the financial year ended 2018-19. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed as Annexure-3 and the same is self-explanatory. The said Secretarial Audit Report does not contain any qualification or adverse remark.
FIXED DEPOSITS
During the year under review, your Company has neither invited nor accepted any deposits from the Public.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
No significant material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and Companyâs operations in future.
INTERNAL FINANCIAL CONTROLS
The adequacy of Internal Financial Controls is discussed in Management Discussion and Analysis, as stipulated under the Listing Regulations with the Stock Exchanges, which forms part ofthis Report.
LOANS, GUARANTEES OR INVESTMENTS
The Company has not made any transaction relating to inter-corporate loans and investment during the year.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formulated a Corporate Social Responsibility (CSR) Policy to undertake CSR initiatives as specified in Schedule VII of the Companies Act, 2013. The Company has constituted a robust and transparent governance structure to oversee the implementation of CSR Policy, in compliance with the requirements of Section 135 of the Companies Act, 2013.The Annual Report on CSR activities is annexed as Annexure - 4 and forms integral part ofthis Report.
RISK MANAGEMENT
The Company has a well defined risk management policy and framework in place to ensure proper identification and treatment of risks. The identification and mitigation of strategic, business, operational and process risks are carried out for all functions. The key strategic risks along with mitigation plan are presented to the risk management committee on half-yearly basis. Some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this Annual Report. The implementation of the ERM framework has progressed well.
VIGIL MECHANISM
Pursuant to Section 177(9) of the Companies Act, 2013, the Company has established a Vigil Mechanism for directors, employees, suppliers, contractors and other stakeholders of the Company. The same is also intended to cover the Whistle Blower Policy under the Listing Regulations. The purpose and objective of this Policy is to cover serious concerns that would have a larger impact on image and values of the Company due to incorrect financial reporting or improper conduct. The Whistle Blower Policy has been placed on the website of the Company www.subros.com/investors.
The Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company have not reported any frauds under Section 143(12) of the Companies Act, 2013 and rules madethereunder
SEXUAL HARASSMENT
The Company has in place a Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. One Complaint was received under the Policy during the year and the same was disposed off.
RELATED PARTY TRANSACTIONS
The Board of Directors has formulated a Related Party Transaction Policy for determining material related party transactions. The Related Party Transaction Policy is available on the website of the Company. A statement of all particulars of Contracts or Arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, is annexed as Annexure-5 and forms integral parts of this Report.
LISTING
The Equity Shares of your Company continue to be listed on BSE Limited (BSE), NSE Limited (NSE) and Delhi Stock Exchange Limited (DSE). The listing fees for the year 2017-18 have been paid to the said stock exchanges except to DSE as Securities and Exchange Board of India has withdrawn the recognition granted to DSE on November 19,2014.
ANNUAL EVALUATION
The Board has carried out an annual evaluation of its own performance, board committees and individual directors in accordance with the provisions of the Companies Act, 2013, SEBI Listing Regulations and Guidance Note issued by SEBI. In a separate meeting of independent directors, the performance of non-independent directors, Chairman and Managing Director and Board as a whole was evaluated taking into account the view of all the board members. The Board members have adequate expertise drawn from diverse industries like Banking, Administration and Technical and bring specific competencies relevant to the Companyâs business. Information flow from Management to the Board and Committees are timely and of acceptable quality. The Board deliberations and participation of members were found to be quite satisfactory and the Boardâs overall functioning is effective.
NON-CONVERTIBLE DEBENTURES
The Company has allotted Secured Redeemable Non-Convertible Debentures (NCDs) on private placement basis for an amount of Rs. 50 crores on August 22, 2018. The issue of NCDs were approved vide Postal Ballot notice dated March 29, 2017, details of which are given in the Corporate Governance Report which forms part of this Report.
CREDIT RATING
ICRA has reaffirmed/assiagned the Long Term and Short Term Ratings at [ICRA] A and [ICRA] A1 . The NCD Program has been assigned a rating of [ICRA]A .
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
The Company is committed to maintain the highest standards of corporate governance. The Company has complied with the corporate governance requirements, as stipulated under the Listing Regulations. A report on Corporate Governance along with a Certificate from the Practicing Company Secretaries of the Company regarding compliance on the conditions of corporate governance pursuant to Listing Regulations is annexed herewith and forms integral part of this Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure- 6 to this Report.
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure to this Report having regard to the provisions of the first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the said statement of employees under Section 197(12) of Companies Act, 2013 is being sent to the Members of the Company. The said information is available for inspection at the registered office of the Company during working hours and any Member interested in obtaining said statement may write to the Company Secretary at the registered office of the Company
OTHER DISCLOSURES
The Company has complied with the secretarial standards issued by the Institute of Company Secretaries of India on meetings of Board of Directors and General Meetings.
ACKNOWLEDGMENT
Your Board of Directors wishes to convey their appreciation to all the employees for their enormous efforts as well as their collective contribution to the Companyâs performance. Your Directors acknowledge with gratitude the co-operation and support extended by Companyâs bankers, Canara Bank, Kotak Mahindra Bank, & other Banks and our collaborators, Denso Corporation, Japan and Suzuki Motor Corporation, Japan for their continued support. Your Directors also take this opportunity to convey heartfelt gratitude to the Companyâs valued customers, particularly Maruti Suzuki India Limited, Tata Motors Limited, Mahindra & Mahindra Limited, Renault Nissan Automotive India Pvt. Ltd and Force Motors Limited, for the trust and confidence reposed by them in the Management for their unstinted cooperation and support provided to the Company
Last but not the least the Board wishes to thank all Members, vendors and business associates for their trust and continuous support to the Company
For and on behalf of the Board of Directors
RAMESH SURI
Chairman
(DIN: 00176488)
Place: New Delhi
Dated: 28th May, 2018
Mar 31, 2017
DIRECTORS'' REPORT
Dear Members,
The Directors are pleased to present the 32nd Annual Report of the Company together with the audited financial statements for the year ended March 31, 2017.
FINANCIAL RESULTS
|
Standalone |
Consolidated |
|||
|
Current year |
Previous year |
Current year |
Previous year |
|
|
PARTICULARS |
2016-17 |
2015-16 |
2016-17 |
2015-16 |
|
(Rs,in Lacs) |
(Rs,in Lacs) |
(Rs,in Lacs) |
(Rs,in Lacs) |
|
|
Gross Profit before financial charges and depreciation |
17,035 |
15,453 |
17,034 |
15,461 |
|
Less: Financial Charges |
4,222 |
4,172 |
4,222 |
4,172 |
|
Less: Depreciation |
8,791 |
8,636 |
8,799 |
8,650 |
|
Less: Exceptional Items |
3,103 |
â |
3,103 |
â |
|
Net profit before Taxation |
919 |
2,645 |
910 |
2,639 |
|
Less: Taxation itmes |
(485) |
244 |
(485) |
244 |
|
Profit after Taxation |
1,404 |
2,401 |
1,395 |
2,395 |
|
Add: Profit brought forward |
20,658 |
19,086 |
20,599 |
19,032 |
|
Profit Available for appropriation |
22,062 |
21,487 |
21,994 |
21,427 |
|
Less: Proposed Dividend* |
- |
480 |
- |
480 |
|
Less:- Tax on Dividend* |
- |
99 |
- |
99 |
|
Less:- Transfer to General Reserves |
150 |
250 |
150 |
250 |
|
Balance carried over to Balance Sheet |
21,912 |
20,658 |
21,844 |
20,598 |
* As per Companies (Accounting Standards) Amendments Rules, 2016 BUSINESS OPERATIONS
Your Company had an unfortunate fire incident in one of the plants of the Company situated at Manesar, Haryana on May 29, 2016. The fire was controlled, however it severely impacted the building, stocks and plant & machinery. With all-round support and concerted efforts, by the Company, Manesar Plant has now been formally re-opened on March 29, 2017 after the fire incident. The Assets were adequately insured with reinstatement clause and a claim has been made with the insurance company. An interim amount has been received from the insurance company against the claim lodged. Special/urgent actions to restart supplies to customers post fire accident has temporarily resulted into additional costs during the year under review which have been included in Exceptional Items.
During the financial year ended March 31, 2017, your Company recorded a gross turnover of Rs.1,751 crores during the year as against Rs. 1,480 crores in the previous year, clocking an increase of around 18%. Your Company is continuing with focussed approach in building capacities, introduction of efficient technologies in manufacturing process, new product development and localization in line with Company''s growth plans. The sales of passenger vehicles has registered a growth of 9.23% in 2016-17 whilst our volume of air conditioning systems has grown by 18%. The growth has happened due to industry growth addition of new customers and localization. The performance of the Company is also discussed in Management Discussion and Analysis, as stipulated under Regulation 34 of the Listing Regulations with the Stock Exchanges, which forms part of the Directors'' Report.
EXPANSION AND FUTURE PROSPECTS
Your Company anticipates continued strong growth in the automobile sector due to stable Global economic factors, ''Make in India'' initiative and fuel prices. Your Company is also working to expand sales by catering to the demand from existing and new automobiles manufacturers in India. In the current year, the Company is planning for capacity expansion at Gujarat to cater to the increased demand from existing and new automobiles manufacturers.
The Company''s Tool Engineering Centre at Noida has enabled to focus on in-house development of all Molds/Dies required for new product development.
The Company expects growth in coming years due to increased share of business from its existing customers and expansion of business in new business domains like bus and rail air conditioning, truck refrigeration and radiators. Kindly refer to Management Discussion & Analysis and Corporate Governance Report which forms part of this report.
DIVIDEND
Your Company has earned a net profit (after tax) of Rs. 1404 Lacs as against Rs. 2,401 Lacs in the previous year. The Directors are pleased to recommend a dividend of Rs.0.50 per share i.e. 25% on the paid-up equity share capital of the Company for the financial year ended March 31, 2017 as against Rs. 0.80 per share i.e. 40% declared in the previous year. The dividend, if approved by the Members at the ensuing Annual General Meeting, shall absorb a sum of Rs. 361 Lacs (approx), including of dividend tax. 17
TRANSFER TO RESERVES
Your Company proposes to transfer Rs. 150 Lacs to the General Reserves.
EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS
There were no material changes and commitments which affect the financial position of the Company subsequent to the date of financial statement.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
i) During the year under review the following changes took place in the Board of your Company:
a) Mr. Y. Makino resigned as Nominee Director (Representative of Denso Corporation, Japan) with effect from August 8, 2016
b) Mr. Y. Kajita resigned as an Alternate Director (Alternate to Mr. Y. Makino) with effect from August 8, 2016
c) Mr. Y. Iida was appointed as Nominee Director (Representative of Denso Corporation, Japan) with effect from August 8, 2016
d) Mr. T. Nagata was appointed as an Alternate Director (Alternate to Mr. Y. Iida) with effect from August 8, 2016
e) Mr. T. Nagata resigned as an Alternate Director (Alternate to Mr. Y. Iida) with effect from March 29, 2017
f) Mr. K. Yamauchiwas appointed as an Alternate Director (Alternate to Mr. Y. Iida) with effect from March 29, 2017
ii) Pursuant to the provisions of Section 152 of the Companies Act, 2013 Mr. KenichiAyukawa, Non Executive Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. The brief resume of Mr. Kenichi Ayukawa as required under the Listing Regulations is provided in the Notice of the 32nd Annual General Meeting of the Company. The requisite resolution pertaining to the appointment/re-appointment appears at the respective items of the Notice along with the Statement and recommended to the Members for approval.
iii) Pursuant to the provisions of Section 203 of the Companies Act, 2013, Mr. Rakesh Arora was appointed as Company Secretary with effect from August 8, 2016 in place of Mr. Hemant K. Agarwal, Dy. Company Secretary who resigned from the position of Dy. Company Secretary.
iv) Declaration from Independent Director: The Company has received necessary declaration(s) from all the Independent Directors of the Company as laid down under Section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and the Listing Regulations.
v) Board Evaluation: In compliance with the provisions of the Companies Act, 2013, the Board has formulated a framework, inter alea, for a formal mechanism of evaluation of its performances as well as that of its committees and individual Directors, including the Chairman of the Board. Nomination & Remuneration Committee has approved the evaluation formats for the Board, Executive & Non Executive Directors and Chairman of the Company considering qualification, expertise, attributes and various parameters based on which evaluation of the Board has to be carried out by the Company.
vi) Board Meeting: The Board of Directors met six times during the financial year 2016-17, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed under the Companies Act, 2013.
vii) Policy on Directors'' appointment and remuneration: The policy of the Company on Directors'' appointment and remuneration including criteria for determining qualifications, positive attributes and other matters are available on the website of the Company.
AUDIT COMMITTEE
The Composition of Audit Committee of the Company is described in Corporate Governance Report as stipulated under Listing Regulations, which forms part of the Directors'' Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under Section 134 (5) of the Companies Act, 2013, your Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
(c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) The Directors have prepared the annual accounts on a going concern basis;
(e) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
SUBSIDIARIES AND JOINTVENTURES
During the financial year under review, THAI SUBROS LIMITED, Subsidiary Company in Thailand, did not carry out any business operations and the company incurred a loss of THB 6.73 Lacs as against THB 5.28 lacs in the previous year. The Company is examining other options and will accordingly decide upon the future course of action.
During the financial year under review the financial performance of Denso Subros Thermal Engineering Centre India Limited, a Joint Venture, achieved gross revenues of Rs. 1,559.58 Lacs as against Rs.1,469.34 Lacs during the previous financial year, a increase of Rs. 90.24 lacs over the last year. The Company earned a profit of Rs. 13.98 Lacs during the year as against profit of Rs.11.23 Lacs in last year. Your Company is holding 26% share in this Joint Venture.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements read with Accounting Standard AS-27 on Financial Reporting for Interest in Joint Ventures, your Directors have pleasure in attaching the Audited Consolidated Financial Statements, which form a part of the Annual Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO
The information in terms of Section 134(3)(m) of the Companies Act, 2013 read with relevant rules is annexed herewith as Annexure-1 and forms integral part of this report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, the extract of annual return in FormMGT-9, is annexed as Annexure-2 to this report and forms integral part of this Report.
AUDITORS AND AUDITOR''S REPORT
Statutory Auditors: M/s. V.K. Dhingra & Co., Chartered Accountants, hold office until the conclusion of the ensuing annual general meeting. The Auditors'' Report to the Members for the year under review does not contain any qualification. As per the provisions of Section 139 of the Companies Act, 2013, the Board has recommended the appointment of M/s Price Waterhouse Chartered Accountants LLP, Chartered Accountant as Statuary Auditors of the Company from the conclusion of the 32nd Annual General Meeting (AGM) till the conclusion of 37th AGM for approval of the Members.
The observations of the Auditors and the relevant notes on accounts are self-explanatory and therefore do not call for any further comments. The Auditors'' Report does not contain any qualification or adverse remark.
Cost Auditors: The Company has appointed M/s. Chandra Wadhwa & Company, Cost Accountants, as Cost Auditors of the Company to conduct the audit of cost records maintained by the Company for the financial year 2017-18. The ratification of remuneration payable to Cost Auditors for the financial year 2017-18 is being sought from the Members of the Company at the ensuing Annual General Meeting.
Secretarial Auditors: The Company has appointed M/s. RSM & Co., Company Secretaries as Secretarial Auditors to conduct the audit of secretarial and related records of the Company for the financial year ended March 31, 2017. The Secretarial Audit Report for the financial year ended March 31, 2017 is annexed herewith asAnnexure-3 and the same is self-explanatory. The said Secretarial Audit Report does not contain any qualification or adverse remark.
FIXED DEPOSITS
During the year under review, your Company has neither invited nor accepted any deposits from the Public.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
No significant material orders were passed by the Regulators or Courts or Tribunals impacting the going concern status and Company''s operations in future.
INTERNAL FINANCIAL CONTROLS
The adequacy of Internal Financial Controls is discussed in Management Discussion and Analysis, as stipulated under the Listing Regulations with the Stock Exchanges, which forms part of the Directors'' Report.
LOANS, GUARANTEES OR INVESTMENTS
The Company has not made any transaction relating to inter-corporate loans and investment during the year.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formulated a Corporate Social Responsibility (CSR) Policy to undertake CSR initiatives as specified in Schedule VII of the Companies Act, 2013. The Company has constituted a robust and transparent governance structure to oversee the implementation of CSR Policy, in compliance with the requirements of Section 135 of the Companies Act, 2013.The Annual Report on CSR activities is annexed herewith as Annexure -4 and forms integral part of this Report.
RISK MANAGEMENT
One meeting of the Risk Management Committee was held during the year and the Committee has formulated the risk management framework, identified the elements of various risks and devised a risk mitigation plan. The implementation of the ERM framework has progressed well during the financial year under review.
VIGIL MECHANISM
Pursuant to Section 177(9) of the Companies Act, 2013, the Company has established a Vigil Mechanism for directors, employees, suppliers, contractors and other stakeholders of the Company. The same is also intended to cover the Whistle Blower Policy under the aspect of Listing Regulations. The purpose and objective of this Policy is to cover serious concerns that would have a larger impact on image and values of the Company due to incorrect financial reporting or serious improper conduct. The Whistle Blower Policy has been placed on the website of the Company www.subros.com.The Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company, have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143(12) of the Companies Act, 2013 and rules made there under.
SEXUAL HARASSMENT
The Company has in place a Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. No Complaint received under the Policy during the year.
RELATED PARTY TRANSACTIONS
The Board of Directors has formulated a Related Party Transaction Policy for determining material related party transactions. The Related Party Transaction Policy is available on the website of the Company. A statement of all particulars of Contracts or Arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, duly approved by the Board of Directors is annexed herewith as Annexure-5 and forms integral parts of the Report.
LISTING
The Equity Shares of your Company continue to be listed on BSE Limited (BSE), NSE Limited (NSE) and Delhi Stock Exchange Limited (DSE). The listing fees for the year 2016-17 have been paid to the said stock exchanges except to DSE as Securities and Exchange Board of India has withdrawn the recognition granted to DSE on November 19, 2014.
ANNUAL EVALUATION
The annual performance of the Board, its Committees and each Director has been carried out for 2016-17 in accordance with the framework. It is opinioned that the Company''s Board composition, structure, processes and working procedure are well laid. The Board members have adequate expertise drawn from diverse industries like Banking, Administration and Technical & bring specific competencies relevant to the Company''s business. Information flow from Management to the Board and Committees are timely and of acceptable quality. The Board deliberations and participation of members were found to be quite satisfactory and the Board''s overall functioning is effective.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure- 6 to this Report.
Disclosure in respect to remuneration and other details as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the Annexure to this Report having regard to the provisions of the first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report excluding the said statement of employees under Section 197(12) of Companies Act, 2013 is being sent to the Members of the Company. The said information is available for inspection at the registered office of the Company during working hours and any Member interested in obtaining said statement may write to the Company Secretary at the registered office of the Company.
POSTAL BALLOT
The approval of the Shareholders was sought on the proposal to issue Secured Redeemable Non-Convertible Debentures on private placement basis for an aggregate amount of Rs. 150 crores vide Postal Ballot notice dated March 29, 2017, details of which are given in the Corporate Governance Report which forms part of this Report.
CREDITRATING
ICRA has reaffirmed the Long Term and Short Term Ratings at [ICRA] A and [ICRA] A1 . The outlook on the long-term rating is "Stable".
CORPORATE GOVERNANCEAND SHAREHOLDERS INFORMATION
The Company is committed to maintain the highest standards of corporate governance. The Company has complied with the corporate governance requirements, as stipulated under the Listing Regulations. A report on Corporate Governance along with a Certificate from the Auditors of the Company regarding compliance on the conditions of corporate governance pursuant to Listing Regulations is annexed herewith and forms integral part of this report.
ACKNOWLEDGMENT
Your Board of Directors wishes to convey their appreciation to all the employees for their enormous efforts as well as their collective contribution to the Company''s performance. Your Directors acknowledge with gratitude the co-operation and support extended by Company''s bankers, Canara Bank, Kotak Mahindra Bank, & other Banks and the Management of our collaborators, Denso Corporation and Suzuki Motor Corporation, Japan for their continued support. Your Directors also take this opportunity to convey heartfelt gratitude to the Company''s valued customers, particularly MarutiSuzukiIndia Limited, Tata Motors Limited, Mahindra &Mahindra Limited, Renault Nissan Automotive India Pvt. Ltd and Force Motors Limited, for the trust and confidence reposed by them in the Management for their unstinted co-operation and support provided to the Company. Last but not the least the Board wishes to thank all Members, vendors and business associates for their continuous support and confidence reposed in the Company.
For and on behalf of Board of Directors
RAMESH SURI
Place: New Delhi Chairman
Dated: 23rd May, 2017 (DIN: 00176488)
Mar 31, 2016
Dear Members,
The Directors are pleased to present the 31st Annual Report of the
Company together with the audited financial statements for the year
ended March 31, 2016.
FINANCIALRESULTS
Standalone Consolidated
Current
year Previous
year Current
year Previous
year
PARTICULARS 2015-16 2014-15 2015-16 2014-15
(Rs,in Lacs) (Rs,in
Lacs) (Rs,in Lacs) (Rs,in
Lacs)
Gross Profit before
financial charges
and depreciation 15,453 13,781 15,461 13,768
Less: Financial
Charges 4,172 3,872 4,172 3,873
Less: Depreciation 8,636 7,869 8,650 7,886
Net profit before
Taxation 2,645 2,040 2,639 2,009
Less: Taxation 244 8 244 8
Profit after
Taxation 2,401 2,032 2,395 2,001
Add: Profit brought
forward 19,086 17,764 19,032 17,741
Profit Available for
appropriation 21,487 19,796 21,427 19,742
Less: Proposed Dividend 480 420 480 420
Less:- Tax on Dividend 99 85 99 85
Less:- Transfer to
General Reserves 250 205 250 205
Balance carried over
to Balance Sheet 20,658 19,086 0,598 19,032
BUSINESS OPERATIONS
Your Company recorded a gross turnover of Rs. 1,480 crores during the
year as against Rs. 1,333 crores in the previous year, clocking an
increase of around 11%.
Your Company is continuing with investments in building the capacity,
technology up gradation, new product development and localization to
sustain its market leadership in line with Company''s growth plans. The
Indian automobile industry has registered a growth of 6% in 2015-16
while our volume of air conditioning systems has grownby16%.The robust
growth has happened duet addition of new customers and localization. The
Company has made significant efforts to sustain its margins through
various value analysis/value engineering activities, cost management
and other optimization initiatives.
The performance of the Company is also discussed in Management
Discussion and Analysis, as stipulated under Regulation 34 of the
Listing Regulations with the Stock Exchanges, which forms part of the
Directors'' Report.
EXPANSION AND FUTURE PROSPECTS
Your Company looks forward to strong growth in the automobile sector
due to stable Global economic factors, ''Make in India'' initiative and
fuel prices. Your Company is also working to expand sales by catering
to the demand from existing and new automobiles manufacturers in India.
The facility for production of radiators has been commissioned in
March, 2016 at the Manesar works. In the current year, the Company is
planning for capacity expansion at its existing facilities at Noida,
Manesar, Pune, Sanand and Chennai to cater to the increased demand from
existing and new automobiles manufacturers.
The Company''s Tool Engineering Centre has enabled to focus on in-house
development of all Molds/Dies required for new product development.
This will help the Company to shorten the lead-time of product
development at reduced costs.
The Company expects growth in coming years due to increased share of
business from its existing customers and expansion of business in new
business domains like bus air conditioning, truck refrigeration and
radiators. Your Company will continue to concentrate on cost management
initiatives to be more competitive and also to spread out to new
related domains.
DIVIDEND
Your Company has earned a net profit (after tax) of Rs. 2,401 Lacs as
against Rs. 2,032 Lacs in the previous year. The Directors are pleased
to recommend a dividend of Rs. 0.80 per share i.e. 40% on the paid-up
equity share capital of the Company for the financial year ended March
31, 2016 as against Rs. 0.70 per share i.e. 35% declared in the
previous year. The dividend, if approved by the Members at the ensuing
Annual General Meeting, shall absorb a sum of Rs. 480 Lacs (approx),
exclusive of dividend tax.
TRANSFER TO RESERVES
Your Company proposes to transfer Rs. 250 Lacs to the General Reserves.
EVENTS SUBSEQUENTTOTHEDATEOFFINANCIALSTATEMENTS
There were no material changes and commitments which affect the
financial position of the Company subsequent to the date of financial
statement.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
i) During the year under review the following changes took place in the
Board of your Company:
a) Mr. Katsuhisa Shimokawa resigned as Nominee Director (Representative
of Denso Corporation, Japan) with effect from January 25, 2016
b) Mr. Yoshitaka Kajita resigned as an Alternate Director (Alternate to
Mr. Katsuhisa Shimokawa) with effect from January 25, 2016
c) Mr. Yoshikazu Makino was appointed as Nominee Director
(Representative of Denso Corporation, Japan) with effect from January
25, 2016
d) Mr. Yoshitaka Kajita was appointed as an Alternate Director
(Alternate to Mr. Yoshikazu Makino ) with effect from January 25, 2016
e) Mr. Devireddy Madhusudhana Reddy resigned as Executive Director with
effect from March 31, 2016.
ii) Pursuant to the provisions of Section 152 of the Companies Act,
2013 Dr. Jyotsna Suri, Non Executive Director of the Company retires by
rotation at the ensuing Annual General Meeting and being eligible,
offers herself for reappointment. The brief resume of Dr. Jyotsna Suri
as required under the Listing Regulations is provided in the Notice of
the 31st Annual General Meeting of the Company. The requisite
resolutions pertaining to the appointment/re-appointment appears at the
respective items of the Notice along with the Statement and recommended
to the Members for approval.
iii) Pursuant to the provisions of Section 203 of the Companies Act,
2013, Mr. Manoj Kumar Sethi was appointed as Chief Financial Officer
with effect from May 14, 2015.
iv) Declaration from Independent Director: The Company has received
necessary declaration from all the Independent Directors of the Company
as laid down under Section 149(7) of the Companies Act, 2013 confirming
that they meet with the criteria of Independence as laid down under
Section 149(6) of the Companies Act, 2013 and the Listing Regulations.
v) Board Evaluation: In compliance with the provisions of the
Companies Act, 2013, the Board during the year adopted a formal
mechanism for evaluation of its performances as well as that of its
committees and individual Directors, including the Chairman of the
Board. Nomination & Remuneration Committee has approved the draft
evaluation formats for the Board, Executive & Non Executive Directors
and Chairman of the Company considering qualification, expertise,
attributes and various parameters based on which evaluation of the
Board has to be carried out by the Company.
vi) Board Meeting: The Board of Directors met five times during the
financial year 2015-16, the details of which are given in the Corporate
Governance Report that forms part of this Annual Report. The
intervening gap between any two meetings was within the period
prescribed under the Companies Act, 2013.
vii) Policy on Directors'' appointment and remuneration: The policy of
the Company on Directors'' appointment and remuneration including
criteria for determining qualifications, positive attributes and other
matters are available on the website of the Company.
AUDITCOMMITTEE
The Composition of Audit Committee of the Company is described in
Corporate Governance Report as stipulated under Listing Agreement with
the Stock Exchanges, which forms part of the Directors'' Report.
DIRECTORS''RESPONSIBILITYSTATEMENT
As required under Section 134 (5) of the Companies Act, 2013, your
Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(b) The Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit and
loss of the Company for that period;
(c) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(d) The Directors have prepared the annual accounts on a going concern
basis;
(e) The Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively; and
(f) The Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
SUBSIDIARIESANDJOINTVENTURES
During the financial year under review, THAI SUBROS LIMITED, Subsidiary
Company in Thailand, did not carry out any business operations and the
company incurred a loss of THB 5.28 Lacs as against THB 14.86 lacs in
the previous year.
During the financial year under review the financial performance of
Denso Subros Thermal Engineering Centre India Limited, a Joint Venture,
achieved gross revenues of Rs. 1,469.34 Lacs as against Rs.1,463.03
Lacs during the previous financial year, a marginal increase over the
last year. The Company earned a profit of Rs. 11.23 Lacs (unaudited)
during the year as against loss of Rs. 0.98 Lacs in last year. Your
Company is holding 26% share in this Joint Venture.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard AS-21 on Consolidated
Financial Statements read with Accounting Standard AS-27 on Financial
Reporting for Interest in Joint Ventures, your Directors have pleasure
in attaching the Audited Consolidated Financial Statements, which form
a part of the Annual Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO
The information in terms of Section 134(3)(m) of the Companies Act,
2013 read with relevant rules is annexed herewith asAnnexure-1 and
forms integral part of this report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule12 of the
Companies (Management and Administration) Rules, 2014, the extract of
annual return in Form MGT-9, is annexed asAnnexure-2 to this report and
forms integral part of this Report.
AUDITORSANDAUDITOR''SREPORT
Statutory Auditors: M/s. V.K. Dhingra & Co., Chartered Accountants were
appointed as Statutory Auditors at the 30th Annual General Meeting of
the Company to hold office from the conclusion of the Annual General
Meeting held in the year 2015 till the conclusion of the Annual General
Meeting to be held in the year 2017, subject to ratification by Members
at every subsequent Annual General Meetings. The Members are requested
to ratify the appointment of M/s V.K. Dhingra & Co,
Chartered Accountants (Firm Registration No.000250N) as Statutory
Auditors of the Company for the financial year 2016-17. The
observations of the Auditors and the relevant notes on accounts are
self-explanatory and therefore do not call for any further comments.
The Auditors'' Report does not contain any qualification or adverse
remark.
Cost Auditors: The Company has appointed M/s. Chandra Wadhwa & Company,
Cost Accountants, as Cost Auditors of the Company to conduct the audit
of cost records maintained by the Company for the financial year
2016-17. The ratification of remuneration payable to Cost Auditors for
the financial year 2016-17 is being sought from the Members of the
Company at the ensuing Annual General Meeting.
Secretarial Auditors: The Company has appointed M/s. RSM & Co., Company
Secretaries as Secretarial Auditors to conduct the audit of secretarial
and related records of the Company for the financial year ended March
31, 2016. The Secretarial Audit Report for the financial year ended
March 31, 2016 is annexed herewith asAnnexure-3 and the same is
self-explanatory. The said Secretarial Audit Report does not contain
any qualification or adverse remark.
FIXEDDEPOSITS
During the year under review, your Company has neither invited nor
accepted any deposits from the Public.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS
No significant material orders were passed by the Regulators or Courts
or Tribunals impacting the going concern status and Company''s
operations in future.
INTERNALFINANCIALCONTROLS
The adequacy of Internal Financial Controls is discussed in Management
Discussion and Analysis, as stipulated under the Listing Regulations
with the Stock Exchanges, which forms part of the Directors'' Report.
LOANS, GUARANTEES OR INVESTMENTS
The Company has not made any transaction relating to inter-corporate
loans and investment during the year.
CORPORATE SOCIAL RESPONSIBILITY
The Company has formulated a Corporate Social Responsibility (CSR)
Policy to undertake CSR initiatives as specified in Schedule VII of the
Companies Act, 2013. The Company has constituted a robust and
transparent governance structure to oversee the implementation of CSR
Policy, in compliance with the requirements of Section 135 of the
Companies Act, 2013.The Annual Report on CSR activities is annexed
herewith as Annexure - 4 and forms integral part of this Report.
RISK MANAGEMENT
Four meetings of the Risk Management Committee were held during the
year and the Committee has formulated the risk management framework,
identified the elements of various risks and devised a risk mitigation
plan.
VIGIL MECHANISM
Pursuant to Section 177(9) of the Companies Act, 2013, the Company has
established a Vigil Mechanism for directors, employees, suppliers,
contractors and other stakeholders of the Company. The same is also
intended to cover the Whistle Blower Policy under the aspect of Listing
Regulations. The purpose and objective of this Policy is to cover
serious concerns that would have a larger impact on image and values of
the Company due to incorrect financial reporting or serious improper
conduct. The Whistle Blower Policy has been placed on the website of
the Company www.subros.com.
SEXUALHARASSMENT
The Company has in place a Sexual Harassment Policy in line with the
requirements of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013. The Internal
Complaints Committee has been set up to redress complaints received
regarding sexual harassment. The Company received one complaint under
the Policy and the same was disposed of.
RELATED PARTY TRANSACTIONS
The Board of Directors has formulated a Related Party Transaction
Policy for determining material related party transactions. The Related
Party Transaction Policy is available on the website of the Company. A
statement of all particulars of Contracts or Arrangements with related
parties referred to in Section 188(1) of the Companies Act, 2013, duly
approved by the Board of Directors is annexed herewith as Annexure-5
and forms integral parts of the Report.
LISTING
The Equity Shares of your Company continue to be listed on BSE Limited
(BSE), National Stock Exchange of India Limited (NSE) and Delhi Stock
Exchange Limited (DSE). The listing fees for the year 2015-16 have been
paid to the said stock exchanges except to DSE as Securities and
Exchange Board of India has withdrawn the recognition
Granted to DSE on November 19, 2014.
ANNUALEVALUATION
The Company has carried out evaluation of Board, Executive Directors,
Independent Directors and Chairperson. It is opinioned that the
Company''s Board composition, structure, processes and working procedure
are well laid. The Board members have adequate expertise drawn from
diverse industries like Banking, Administration and Technical & bring
specific competencies relevant to the Company''s business. Information
flow from Management to the Board and Committees are timely and of
acceptable quality. The Board deliberations and participation of
members were found to be quite satisfactory and the Board''s overall
functioning is effective.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosure in respect to remuneration and other details as per the
provisions of Section 197(12) of the Companies Act, 2013 read with Rule
5(1) of Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are provided in the Annexure- 6 to this Report.
Disclosure in respect to remuneration and other details as per the
provisions of Section 197(12) of the Companies Act, 2013 read with Rule
5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are provided in the Annexure to this Report
Having regard to the provisions of the first proviso to Section 136(1)
of the Companies Act, 2013, the Annual Report excluding the said
statement of employee under Section 197(12) of Companies Act, 2013 is
being sent to the Members of the Company. The said information is
available for inspection at the registered office of the Company during
working hours and any Member interested in obtaining said statement may
write to the Dy. Company Secretary at the registered office of the
Company.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
The Company is committed to maintain the highest standards of corporate
governance. The Company has complied with the corporate governance
requirements, as stipulated under the Listing Regulations. A report on
Corporate Governance along with a Certificate from the Auditors of the
Company regarding compliance on the conditions of corporate governance
pursuant to Listing Regulations is annexed herewith and forms integral
part of this report.
ACKNOWLEDGMENT
Your Board of Directors wishes to convey their appreciation to all the
employees for their enormous efforts as well as their collective
contribution to the Company''s performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Company''s bankers, Canara Bank, Kotak Mahindra Bank, &
other Banks and the Management of our collaborators, Denso Corporation
and Suzuki Motor Corporation, Japan for their continued support.
Your Directors also take this opportunity to convey heartfelt gratitude
to the Company''s valued customers, particularly Maruti Suzuki India
Limited, Tata Motors Limited, Mahindra & Mahindra Limited, Renault
Nissan Automotive India Pvt. Ltd and Force Motors Limited, for the trust
and confidence reposed by them in the Management for their unstinted
co-operation and support provided to the Company.
Last but not the least the Board wishes to thank all Members, vendors
and business associates for their continuous support and confidence
reposed in the Company.
For and on behalf of Board of Directors
RAMESH SURI
Place: New Delhi Chairman
Dated: 26th May, 2016 DIN: 00176488
Mar 31, 2015
The Members
The Directors are pleased to present the 30th Annual Report of the
Company together with the Audited Accounts for the year ended March
31,2015.
FINANCIAL RESULTS
Current year Previous year
2014-15 2013-14
(Rs in Lacs) (Rs in Lacs)
Gross Profit before financial
charges and depreciation 13,781 13,364
Less: Financial Charges and 3,872 3,716
Depreciation 7,869 11,741 7,723 11,439
Net Profit before Taxation 2,040 1,925
Less: Taxation (8) (101)
Profit after Taxation 2032 2,026
Add: Profit brought forward 17,764 16,432
Profit available for appropriation 19,796 18,458
Less: Proposed Dividend 420 420
Less:- Tax on Dividend 85 71
Less: - Transfer to General Reserve 205 203
Balance carried over to 19,086 17,764
Balance Sheet
BUSINESS OPERATIONS
Your company recorded the gross turnover of Rs.1,333 Crores during the
year as against Rs.1,314 Crores in the previous year resulting increase
of 1.44%. During the year under review, the company has sold 962,603
nos. of A.C. systems as against 917,349 nos. in the previous year.
Company has been making investments in building up the capacities
technology up gradation, new product development and Localization to
sustain its market leadership in line with company's growth plans. The
Indian automobile industry has however grown at the marginal pace of
2-3% over last three years. However, the business arising from these
investments is expected to yield better results from the Financial
Year 2015-16.
The company has made significant efforts to sustain its margins through
cost reduction in material cost by import substitution and other cost
optimization initiatives.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors'
Report.
EXPANSION AND FUTURE PROSPECTS
Your company expects the growth in the automobile sector due to
improvement in Global economic factors, stable Government in India and
fuel prices. In view of expected cost pressure, your company planned
extensive localization and cost down initiative. Further your company
is also working to expand sales by catering the demand from existing
and new automobiles manufacturers in India. In the current year, the
company will start supplying to Renault Nissan from its Chennai plant
and expand its business in Chennai to take care of other Southern India
based OEM customers including Rail coach factory.
The company has also expanded its facilities of Tool Engineering Centre
and focusing on in-house development of all Moulds/Dies, which are
required for its new product development. This will help the company to
shorten the lead-time of product development at reduced cost.
The company expects growth in coming years due to increased share of
business from its existing customers and expansion of business in new
business domains like bus air conditioning, truck refrigeration and
radiators. In nutshell company will focus on cost management initiative
to be more competitive with other suppliers to cater additional
business from customers and expand in new domains.
Company is setting up facility for production of radiator for their
customers which will improve revenue of the company.
EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS
There was no material change and commitment's which affect the
financial position of the company subsequent to the date of financial
statement.
DIVIDEND
Your company has earned a net profit (after tax) of Rs.2032 Lacs as
against Rs. 2026 Lacs in the previous year. Your directors recommend a
dividend of Rs 0.70. per share i.e. (35%) on the paid-up equity share
capital for the year ended March 31, 2015 as against Rs. 0.70 per share
i.e. (35%) declared in the previous year. The dividend, if approved by
the shareholders at the ensuing Annual General Meeting, shall absorb a
sum of Rs.420 lacs exclusive of Dividend Tax.
DIRECTORS
(i) Directors & Key Managerial Personnel (Appointment & Resignation)
During the year, the following changes took place in the Board of your
company:
a) Directors
- Resignation of Mr. Y. Makino from the office of Nominee Director
(Representative of Denso Corporation, Japan) w.e.f. November 03, 2014
- Appointment of Mr. Katsuhisa Shimokawa as Nominee Director
(Representative of Denso Corporation, Japan) w.e.f. November03, 2014
- Reappointment of Mr D M Reddy as Executive Director w.e.f.
01.04.2015 on expiration of his term.
The requisite resolutions pertaining to the Appointment/Re-appointment
appears at the respective items of the notice along with the
Explanatory Statement and are recommended to the shareholders for
approval.
b) Key Managerial Personnel
- Resignation of Mr. Vikas Sabharwal from the office of Dy. Company
Secretary w.e.f. February 14,2015.
- Appointment of Mr. Hemant Kumar Agarwal, asDy. Company Secretary
w.e.f. March 5, 2015.
(ii) Retire By Rotation
Pursuant to the provisions of Section 152 of the Companies Act, 2013
Mr. Kenichi Ayukawa, Non Executive Director of the Company retire by
rotation at the ensuing Annual General Meeting and being eligible,
offer himself for reappointment.
Brief profile of Mr. Kenichi Ayukawa as required under Clause
49(VIII)(E) of the Listing Agreement is provided in the Corporate
Governance, attached hereto.
(iii) Declaration From Independent Directors
The company has received necessary declaration from all the Independent
Directors of the Company under Section 149(7) of the Companies Act,
2013 that the Independent Directors of the Company meet with the
criteria of their Independence laid down in Section 149(6).
(iv) Board Annual Evaluation
In compliance with the provisions of the Companies Act, 2013,the Board
during the year adopted a formal mechanism for evaluation of its
performances as well as that of its committees and individual
Directors, including the Chairman of the Board.
Nomination & Remuneration Committee has approved the draft evaluation
formats for the Board, Executive and Non Executive Directors and
Chairperson of the company considering qualification, expertise,
attributes and various parameters based on which evaluation of the
Board has to be carried out by the company.
(v) Board Meeting
During the financial year 2014-15, Five Board meetings were held on
26.05.2014, 28.07.2014, 03.11.2014, 13.02.2015 and 24.03.2015.
The Composition of Audit Committee of the Company is given in Corporate
Governance Report, as
stipulated under Clause-49 of the Listing Agreement with the Stock
Exchanges, which forms part of
the Director's Report.
DIRECTORS' RESPONSIBILITY STATEMENT
As required under section 134 (5) of the Companies Act, 2013, the
Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(b) The directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the profit and
loss of the company for that period;
(c) The directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
(d) The directors had prepared the annual accounts on a going concern
basis; and
(e) The directors have laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
(f) The directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively
INFORMATION ABOUT THE FINANCIAL PERFORMANCE / FINANCIAL POSITION OF
THE SUBSIDIARIES/JOINT VENTURE
1. SUBSIDIARY
During the financial year under review THAI SUBROS LIMITED Subsidiary
Company in Thailand, achieved gross revenue of THB 64 Lacs as against
THB 95 Lacs during the last financial year, the sales has decreased by
33% over the last year and the company was having a loss of THB (14.68)
Lacs as against lossofTHB (16.27) lacs during the current year.
As the business of the Customers of Subsidiary Company has not grown as
per business plan. It is not economically viable to continue the
business operations at Thailand. Accordingly Company decided to
transfer all the inventory and assets lying at Thailand to our Pune
Plant.
2. JOINT VENTURE
During the financial year under review the financial performance of
Denso Subros Thermal Engineering Centre India Limited (JV), achieved
gross revenue of Rs.1,463.03 Lacs as against Rs.1,680.78 Lacs during
the last financial year, the sales has been decreased by 13% over the
last year and the company incurred loss of Rs.0.98 Lacs during the year
as against profit of Rs. 320.73 Lacs in last year. Subros Limited is
holding 26% share in Joint Venture.
In accordance with the Accounting Standard AS-21 on Consolidated
Financial Statements read with Accounting Standard AS-27 on financial
reporting for interest in Joint Ventures, the Audited Consolidated
Financial Statements are provided in the Annual Report.
EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act,2013 and
rule 12(1) of the Companies (Management and Administration) Rules,
2014, an extract of annual return in MGT9 as a part of this Director's
Report is enclosed as ANNEXURE I.
AUDITORS AND AUDITORS REPORT
(i) Statutory Auditor
M/s. V.K. Dhingra & Co., Chartered Accountants, Statutory Auditors of
the Company retire at the conclusion of the ensuing Annual General
Meeting and being eligible for reappointment, offered themselves for
reappointment.
The notes of accounts referred to in the Auditors Reports are self
explanatory.
No Qualification remark in Audit report.
(ii) Cost Auditor
The Company has appointed M/s. Chandra Wadhwa & Company, Cost
Accountants, as Cost Auditor of the Company to conduct the audit of
cost records maintained by the Company for the Financial Year ending
31st March, 2016.
(iii) Secretarial Auditor
The Company has appointed M/s. RSM & Co., Company Secretaries as
Secretarial Auditors to conduct the audit of secretarial and related
records of the Company for the Financial Year ended 31stMarch, 2016.
Secretarial Auditor report is annexed herewith as Annexure II for
financial year 2014-15 which is self-explanatory.
No Qualification remark in Secretarial Audit Report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
OUTGO
Conservation of Energy:
Information relating to conservation of Energy, Technology Absorption
etc.,in terms of Section 134 (3) (m) of the CompaniesAct,2013 read with
relevant rules is annexed herewith.
FIXED DEPOSITS
During the year the Company has not received any deposits from the
public under section of 73 to 76 of CompaniesAct,2013 read with the
Companies (Acceptance of Deposit) Rules.
SIGNIFICANT& MATERIAL ORDERS PASSED BY THE REGULATORS
There are no material orders passed by the regulators or Courts or
Tribunals impacting the going concern status and the company's
operations in future.
DETAILS OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The adequacy of Internal Financial Controls is also discussed in
Management Discussion and Analysis, as Stipulated under Clause 49 of
the Listing agreement with the Stock Exchanges, which forms part of the
Director Report.
LOANS, GUARANTEES OR INVESTMENTS
The Company has not made any transaction of Inter-Corporate Loan &
Investment during the year. CORPORATE SOCIAL RESPONSIBILITY
The Company has formulated a Corporate Social Responsibility (CSR)
Policy to undertake CSR initiative as specified in Schedule VII of the
Companies Act, 2013. The Company has constituted a robust and
transparent governance structure to oversee the implementation of CSR
policy, in compliance with the requirement of Section 135 of the
Companies Act, 2013.
During the year, the Company has undertaken CSR initiatives in the
areas of Environmental Sustainability for social & environmental
growth. The Annual Report on CSR activities is annexed herewith as
"Annexure III".
POLICIES
(i) Remuneration Policy
The Board of Directors has adopted a policy relating to the
remuneration for the directors, key managerial personnel and other
employees based on recommendation of Nomination and Remuneration
Committee. Remuneration Policy has been placed on the website of the
Company www.subros.com.
(ii) Risk Management Policy
The Board of Directors has constituted Risk Management Committee for
development and implementation of Risk management policy for the
company. During the year one meeting was held wherein Committee has
advised to the Management to identify the elements of various risks
which may threaten the existence of the company. Therefore Risk
Management framework is in | the process of development.
(iii)Whistle Blower Policy / Vigil Mechanism
Pursuant to Section 177(9) of the Companies Act, 2013, the Company has
established Vigil Mechanism for directors, employees, suppliers,
contractors and other stakeholders etc of the Company. The same is also
intended to cover the Whistle Blower Policy under the aspect of Clause
49 of the SEBI's listing agreement. The purpose and objective of this
Policy is to cover serious concerns that would have a larger impact on
image and values of the company due to incorrect financial reporting or
serious improper conduct. The Whistle Blower Policy has been placed on
the website of the Companywww.subros.com.
RELATED PARTY TRANSACTIONS
The Board of Director had duly approved related party transaction
policy for determining the Material Related Party Transactions. The
Related Party Transactions Policy is disseminated in the website of the
Company (www.subros.com/Investors /Policies /RPT).
A Statement of all particulars of Contracts or Arrangements with
Related parties referred to in Section 188(1) duly approved by the
Board of Director is annexed herewith as ANNEXURE IV.
LISTING
The Equity Shares of your Company continue to be listed on BSE Limited
(BSE), National Stock Exchange of India Limited (NSE) and Delhi Stock
Exchange Limited. There is no default in payment of Annual listing fees
and annual custodian fee in respect of shares held in dematerlisation
mode to NSDLand CDSL.
DEMATERIALISATION OF SHARES
To provide better and smooth service to the shareholders, the Company's
equity shares have been made available for dematerialisation in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository
Services(India) Limited (CDSL), Mumbai. In order to avail the service,
shareholders can dematerialized the shares in the electronic form.
ANNUAL EVALUATION
The company has carried out evaluation of Board, Executive Directors,
Independent Directors and Chairperson. It is opinioned that the
company's Board composition, structure, processes and working procedure
are well laid. Board members have adequate expertise drawn from diverse
industries, Banking, Administration, Technical, business and bring
specific competencies relevant to the company's business. Information
flow from Management to the Board and Committees are timely and of
acceptable quality. The Board deliberations and participation of
members were found to be quite satisfactory and the Board's overall
functioning is effective.
RATIO OF REMUNERATION TO EACH DIRECTOR
Details/Disclosures of Ratio of Remuneration to each Director to the
median employee's remuneration is annexed herewith asANNEXURE -V.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
The Company is committed to maintain the highest standards of corporate
governance. The Directors adhere to the requirement set out by the
Securities and Exchange Board of India's Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A Report on Corporate Governance along with a Certificate from the
Auditors of the Company regarding compliance of the conditions of
Corporate Governance pursuant to Clause 49 of the Listing Agreement
with stock exchanges is annexed herewith as Annexure-VI and forms part
of the Annual Report.
SECRETARIAL STANDARDS
Company is in compliance with the disclosure as per Secretarial
Standard of ICSI.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Company's Act,
2013 read with Rules 5(2) and 5(3) of the Companies (appointment and
Remuneration of Managerial Personnel) Rules, 2014,a statement showing
the names and other particulars of the employees drawing remuneration
in excess of the limits set out in the said rules are provided in the
Annual Report.
Having regard to the provisions of the first proviso to Section 136(1)
of the Act, the Annual Report excluding the said statement of employee
under section of 197(12) of Company's Act, 2013 is being sent to the
members of the Company. The said information is available for
inspection at the registered office of the Company during working hours
and any member interested in obtaining said statement copy may write to
the Dy. Company Secretary at the registered office of the company.
ACKNOWLEDGMENT
Your Directors wish to convey their appreciation to all the company's
employees for their enormous efforts as well as their collective
contribution to the company's performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by company's bankers, Canara Bank, Kotak Mahindra Bank, &
other Banks and the Management of our collaborators, Denso Corporation
and Suzuki Motor Corporation, Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
company's valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited, for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place : New Delhi RAMESH SURI
Dated: 14th May, 2015 Chairman
DIN NO - 00176488
Mar 31, 2014
The Members
The Directors are pleased to present the 29th Annual Report of the
Company together with the Audited Accounts for the year ended
31stMarch, 2014.
FINANCIAL RESULTS
Current year Previous year
2013-14 2012-13
(Rs. in Lacs) (Rs. in Lacs)
Gross Profit before financial
charges and depreciation 13364 13305
Less: Financial
Charges and 3716 3592
Depreciation 7723 11439 7255 10847
Net Profit before
Taxation 1925 2458
Less: Taxation (101) 401
Profit after Taxation 2026 2057
Add: Profit brought
forward 16432 15069
Profit available for
appropriation 18458 17126
Less: Proposed Dividend 420 420
Less:-Taxon Dividend 71 68
Less:-Transfer to
General Reserve 203 206
Balance carried over to 17764 16432
Balance Sheet
DIVIDEND
Your Company has earned a net profit (after tax) of Rs.2026 Lacs as
against Rs.2057 Lacs in the previous year. Your directors recommend a
dividend of Rs.0.70 per share i.e. (35%) on the paid-up equity share
capital for the year ended 31st March, 2014 as against Rs.0.70 per
share i.e. (35%) declared in the previous year. The dividend, if
approved by the shareholders at the ensuing Annual General Meeting,
shall absorb a sum of Rs.420 lacs exclusive of Dividend Tax.
BUSINESS OPERATIONS
Your Company has invested significantly for Technology upgradation, New
product development and Localisation to sustain its market leadership
in future years. However, the adverse Market situations, delayed
Product launches has led to decline in sales and non-realisation of
complete benefits from the investments made and higher finance cost.
The Indian Auto Industry on account of many economic and industrial
reasons has shown slower trend and has consequently de-grown by 5%,
where as our main customer i.e. Maruti Suzuki has grown positively by
around 0.3%, but other customers like Mahindra & Mahindra and Tata
Motors has de- grown substantially. Your company recorded a decrease of
8% in the gross turnover of Rs 1314 crores during the year as against
Rs.1435 crores in the previous year, due to lower sales and impact of
Sale Price adjustments based on Forex levels of previous period. During
the year under review the company has sold 917349 nos. of A.C. systems
as against 955850 nos. in the previous year. However, your company has
continued its efforts for reduction in the raw material cost, thru
VA/VE and other localization programs.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors''
Report.
EXPANSION AND FUTURE PROSPECTS
Your Company, considering the growth in the Automobile sector and
proactively observing the cost pressure, has planned extensive
localization plans & capacities at its existing facilities at Noida,
Manesar and Pune, to cater to the demand from existing as well as new
Automobiles manufacturers in India. The Company in the current year
will expand its business in Chennai to take care of Southern India
based OEM customers.
The Company is also expanding its facilities of Tool Room and focusing
on in house developments of all molds / dies for new product
development, which will help in reducing the lead time for product
development and also save cost. The Company will also focus on Sales of
specialized Tools on commercial basis.
The Company has now strategically diversified into other Thermal
Engineering Products for Automobiles Sector or for other industrial
uses like Refrigerated vans, radiators, Engine cooling modules,
BusAirconditioningand RailAirconditioningetc.
The Company expects growth in coming years due to increased share of
business from its existing Customers and expansion of business in new
business domains like Bus Airconditioning, Truck Refrigeration and
Radiators.
AWARDS AND RECOGNITIONS
The working of your company has always been recognized for improvement
in operational efficiencies, cost control, delivery etc. The Company
was awarded following prestigious awards in the following categories: -
a) Overall performance Gold Trophy from MSIL
b) Shield for Quality from MSIL
c) System Audit Shield from MSIL
d) Inner part localization Certificate from MSIL
e) Manufacturing Excellence Platinum Award from Economic Times
f) Manufacturing Excellence Gold Award from ACMA
g) Ranked no. 1 in Innovation Adaptation & Ranked no.3 in Customer
focus, by frost and Sullivan
h) Excellence award in various Quality Circle Initiatives.
SUBSIDIARY COMPANY
During the financial year under review THAI SUBROS LIMITED subsidiary
Company in Thailand, achieved gross revenue of THB 95 Lacs as against
THB 344 Lacs during the last financial year, the sales has decreased by
72% over the last year and the company was having profit before tax of
THB 13.13 Lacs during the last year as against loss before tax of THB
(16.27) Lacs during the current year under review.
CONSOLIDATION OF ACCOUNT
In accordance with the Accounting Standard AS-21 on Consolidated
Financial Statements read with Accounting Standard AS-27 on financial
reporting for interest in Joint Ventures, the Audited Consolidated
Financial Statements are provided in the Annual Report.
CORPORATE GOVERNANCE
The company is committed to maintain the highest standards of Corporate
Governance. The Directors adhere to the requirements set out by the
Securities and Exchange Board of India''s Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A separate report on Corporate Governance is provided as a part of the
Annual Report alongwith the Auditors certificate on its compliance.
LISTING
The shares of your company are listed on National Stock Exchange of
India Limited, the Stock Exchange of Mumbai and The Delhi Stock
Exchange Association Ltd. The company has paid annual listing fee for
the year 2014-15 and also paid annual custodian fee in respect of
shares held in dematerialization mode to NSDL and CDSL for the year
2014-15.
FIXED DEPOSIT
During the year the Company has not received any deposits from the
public and as such, no amount on account of principal or interest on
public deposits was outstanding as on the date of the balance sheet.
DEMATERIALISATION OF SHARES
To provide better and smooth service to the shareholders, the company''s
equity shares have been made available for dematerialization in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL), Mumbai. In order to avail this service,
shareholders can dematerialize the shares in the electronic form.
DIRECTORS
Mr. K Ayukawa, Mr. Y Makino and Mr. M A Pathan, were appointed as
additional director of the company with effect from 29th July, 2013,
29th July, 2013 and 8th November, 2013 respectively and they shall hold
the office upto the ensuing Annual General Meeting of the Company
pursuant to the provisions of Section 260 of the Companies Act, 1956,
requisite notice has been received under the provisions of the
Companies Act, 2013 from the members for the appointment of Mr. K
Ayukawa, Mr. Y Makino and Mr. MA Pathan.
The non-executive Independent Directors are as per provisions of the
Companies Act, 2013 are getting re-appointed for a period of 5 years,
not liable to retire by rotation. The requisite resolutions pertaining
to the appointment/re-appointment appears at respective items of the
Notice alongwith the and relevant Explanatory statement and is
recommended to the shareholders for approval.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under section 217(2AA) of the Companies Act, 1956, the
directors hereby confirm that :-
in the preparation of annual accounts for the year 2013-14, the
accounting standards issued by the Institute of Chartered Accountants
of India and the requirements of the Companies Act, 1956, to the extent
applicable to the company have been followed;
the Directors have selected such 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 2013-14 and of the profit
of the company for that period;
the Directors have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
Companies Act, 1956, for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities; and
the Directors had prepared the annual accounts on a going concern
basis.
AUDITORS
M/s. V.K. Dhingra & Co. Chartered Accountants, New Delhi retire at the
forthcoming Annual General Meeting and being eligible, offer themselves
for re-appointment. The notes to account referred to in the Auditors''
Report are self-explanatory.
DISCLOSURE OF INFORMATION WITH REGARD TO CONSERVATION OF ENERGY ETC.
Information relating to Conservation of Energy, Technology Absorption
etc., in terms of Section 217(1 )(e) of the Companies Act, 1956 read
with relevant rules is annexed herewith.
EMPLOYEES
Information as per Section 217 (2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules. 1975, as amended,
the names and other particulars of the employees are set out in the
annexure to the Directors'' Report.
However, having regard to the provisions of Section 219(1 )(b)(iv) of
the Companies Act, 1956, the Annual Report is being sent to all the
shareholders of the Company excluding the statement of particulars of
employees under section 217(2A) of the Companies Act, 1956. Any
shareholder interested in obtaining a copy of the said statement may
write to the Dy. Company Secretary at the registered office of the
Company.
ACKNOWLEDGMENT
Your Directors wish to convey their appreciation to all the company''s
employees for their enormous efforts as well as their collective
contribution to the company''s performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Company''s Bankers, Canara & other Banks and the Management
of our collaborators, Denso Corporation and Suzuki Motor Corporation,
Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
Company''s valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited, for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the Company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place: New Delhi RAMESH SURI
Dated: 26th May, 2014 Chairman
Mar 31, 2013
To The Members
The Directors are pleased to present the 28th Annual Report of the
Company together with the Audited Accounts for the year ended 31 st
March, 2013.
FINANCIAL RESULTS
Current year Previous year
2012-13 2011-12
(Rs. in Lacs) (Rs. in Lacs)
Profit before interest
and depreciation 13305 13755
Less: Interest and 3592 2591
Depreciation 7255 10847 5301 7892
Net Profit before Taxation 2458 5863
Less: Taxation 401 1023
Profit after Taxation 2057 4840
Add: Profit brought forward 15069 13496
Profit available for
appropriaton 17126 18336
Less: Proposed Dividend 420 660
Less:-Tax on Dividend 68 107
Less:-Transfer to General
Reserve 206 2500
Balance carried over to 16432 15069
Balance Sheet
DIVIDEND
Your Company has earned a net profit (after tax) of Rs.2056 lacs as
against Rs.4840 lacs in the previous year. Your directors recommend a
dividend of Rs.0.70 per share i.e. (35%) on the paid-up equity share
capital for the year ended 31st March, 2013 as against Rs.1.10 per
share i.e. (55%) declared in the previous year. The dividend, if
approved by the shareholders at the ensuing Annual General Meeting,
shall absorb a sum of Rs.420 lacs exclusive of Dividend Distribution
Tax.
BUSINESS OPERATIONS
Your Company has invested significantly for Technology upgradation, New
product development and
Localisation to sustain its market leadership in future years. However,
due to adverse Market situation, delayed Product launches and
production disruptions at Customer end, there have been disruptions in
supplies during the year. This also has led to non-realisation of
benefits from the investments made and higher Inventory carrying costs.
The Markets for the OE customers stabilized in last quarter of the year
to recover the business situation significantly. As a result, your
company recorded an increase of 16 % in the gross turnover of Rs 1435
crores during the year as against Rs.1235 crores in the previous year.
During the year under review the company has sold 955850 nos. of A.C.
systems as against 852925 nos. in the previous year.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors''
Report.
EXPANSION AND FUTURE PROSPECTS
Your Company considering the growth in the Automobile sector in
general, has planned its capacity and localization plans at its
existing facilities at Noida, Manesar and Pune, to cater to the demand
from existing as well as new Automobiles manufacturers in India. The
Company will in the current year will start the operations from its new
facilities from Chennai, Tamil Nadu for targeting Southern India based
OEM.
The Company is also strategically diversifying into other Thermal
Engineering Products for Automobiles Sector or for other industrial
uses like Refrigerated vans, radiators, Engine cooling modules,
BusAirconditioningand Rail Airconditioning etc.
The Company expects growth in coming years due to increased share of
business from its existing Customers and expansion of business in new
business domains like Bus Airconditioning, Truck Refrigeration and
Radiators.
AWARDS AND RECOGNITIONS
The working of your company has always been recognized for improvement
in operational efficiencies, cost control, delivery etc. The Company
was awarded following prestigious awards in the following categories: -
a) Overall performance Gold Trophy from MSIL
b) Focused Cost down shield from MSIL
c) System Audit Shield from MSIL
d) Inner part localization Certificate from MSIL
e) IMEA Gold Award 2012 from Economic Times
SUBSIDIARY COMPANY
During the financial year under review THAI SUBROS LIMITED subsidiary
Company in Thailand, achieved gross revenue of THB 344 Lacs as against
THB 404 Lacs during the last financial year, the sales has decreased by
15% over the last year and the company was having Loss before tax of
THB 9.41 lacs during the last year as against profit before tax of THB
13.13 Lacs during the current year under review.
CONSOLIDATION OF ACCOUNT
In accordance with the Accounting Standard AS-21 on Consolidated
Financial Statements read with Accounting Standard AS-27 on financial
reporting for interest in Joint Ventures, the Audited Consolidated
Financial Statements are provided in the Annual Report.
CORPORATE GOVERNANCE
The company is committed to maintain the highest standards of Corporate
Governance. The Directors adhere to the requirements set out by the
Securities and Exchange Board of India''s Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A separate report on Corporate Governance is provided as a part of the
Annual Report alongwith the Auditors certificate on its compliance.
LISTING
The shares of your company are listed on National Stock Exchange of
India Limited, the Stock Exchange of Mumbai and The Delhi Stock
Exchange Association Ltd. The company has paid annual listing fee for
the year 2013-14 and also paid annual custodian fee in respect of
shares held in dematerialization mode to NSDL and CDSL for the year
2013-14.
FIXED DEPOSIT
During the year the Company has not received any deposits from the
public under section 58Aof the Companies Act, 1956 read with the
Companies (Acceptance of Deposit) Rules.
DEMATERIALISATION OF SHARES
To provide better and smooth service to the shareholders, the company''s
equity shares have been made available for dematerialization in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL), Mumbai. In order to avail this service,
shareholders can dematerialize the shares in the electronic form.
DIRECTORS
Mr. S Nishimura and Mrs. Meena Sethi who were appointed as additional
director of the company with effect from 30th July, 2012 and they shall
hold the office upto the ensuing Annual General Meeting of the Company
pursuant to the provisions of Section 260 of the Companies Act, 1956
requisite notice has been received under section 257 from the member
for the appointment of Mr. S Nishimura and Mrs. Meena Sethi.
The present term of Ms. ShradhaSuri as Managing Director of the Company
expires on 11th May, 2013. The Board of Directors at its meeting held
on 22nd May, 2013 re-appointed Ms. Shradha Suri as Managing Director
for a further period of 3 years w.e.f. 12th May, 2013. The requisite
resolution pertaining to the re-appointment of Ms. Shradha Suri as
Managing Director appears at item no. 9 of the Notice alongwith the and
relevant Explanatory statement and is recommended to the shareholders
for approval.
Mr. P Sabanayagam, Mr. Hanuwant Singh and Mr. S Nakanishi, Directors of
the Company will retire by rotation at the forthcoming Annual General
Meeting and being eligible offer themselves for reappointment.
DIRECTORS'' RESPONSIBILITY STATEMENT
As required under section 217(2AA) of the Companies Act, 1956, the
directors hereby confirm that :-
- in the preparation of annual accounts for the year 2012-13, the
accounting standards issued by the Institute of Chartered Accountants
of India and the requirements of the Companies Act, 1956, to the extent
applicable to the company have been followed; the Directors have
selected such 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 2012-13 and of the profit of the company for
that period; the Directors have taken proper and sufficient care for
the maintenance of adequate accounting records in accordance with the
provisions of Companies Act, 1956, for safeguarding the assets of the
company and for preventing and detecting fraud and other
irregularities; and
the Directors had prepared the annual accounts on a going concern
basis.
AUDITORS
M/s. V.K. Dhingra fit Co. Chartered Accountants, New Delhi retire at
the forthcoming Annual General Meeting and being eligible, offer
themselves for re-appointment. The notes to account referred to in the
Auditors'' Report are self-explanatory.
DISCLOSURE OF INFORMATION WITH REGARD TO CONSERVATION OF ENERGY ETC.
Information relating to Conservation of Energy, Technology Absorption
etc., in terms of Section 217(1 )(e) of the Companies Act, 1956 read
with relevant rules is annexed herewith.
EMPLOYEES
Information as per Section 217 (2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules. 1975, as amended,
the names and other particulars of the employees are set out in the
annexure to the Directors'' Report.
However, having regard to the provisions of Section 219(1 )(b)(iv) of
the Companies Act, 1956, the Annual Report is being sent to all the
shareholders of the Company excluding the statement of particulars of
employees under section 217(2A) of the Companies Act, 1956. Any
shareholder interested in obtaining a copy of the said statement may
write to the Dy. Company Secretary at the registered office of the
Company.
ACKNOWLEDGEMENT
Your Directors wish to convey their appreciation to all the company''s
employees for their enormous efforts as well as their collective
contribution to the company''s performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Company''s Bankers, Canara & other Banks and the Management
of our collaborators, Denso Corporation and Suzuki Motor Corporation,
Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
Company''s valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited, for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the Company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place: New Delhi RAMESH SURI
Dated: 22nd May, 2013 Chairman
Mar 31, 2012
The Directors are pleased to present the 27th Annual Report of the
Company together with the Audited Accounts for the year ended 31st
March, 2012.
FINANCIAL RESULTS
Current year Previous year
2011-12 2010-11
(Rs. in Lacs) (Rs. in Lacs)
Gross Profit before
financial charges and
depreciation 13755 8800
Less: Financial Charges
and 2591 1543
Depreciation 5301 7892 4055 5598
Net Profit before Taxation 5863 3202
Less: Taxation 1023 348
Profit after Taxation 4840 2854
Add: Profit brought forward 13496 13200
Profit available for
appropriation 18336 16054
Less: Proposed Dividend 660 480
Less: - Tax on Dividend 107 78
Less:-Transfer to General
Reserve 2500 2000
Balance carried over to 15070 13496
Balance Sheet
DIVIDEND
Your Company has earned a net profit (before tax) of Rs.5863 Lacs as
against Rs.3202 Lacs in the previous year. Your directors recommend a
dividend of Rs.1.10 per share i.e. (55%) on the paid-up equity share
capital for the year ended 31st March, 2012 as against Rs.80 paisa per
share i.e. (40%) declared in the previous year. The dividend, if
approved by the shareholders at the ensuing Annual General Meeting,
shall absorb a sum of Rs.660 lacs.
BUSINESS OPERATIONS
Your Company has invested significantly for Technology upgradation, New
product development and Localisation to sustain its market leadership
in future years. However, due to adverse Market situation, delayed
Product launches and severe production disruptions at Customer end,
there have been significant disruptions in supplies during first 3
quarters of the year. This also has led to non- realisation of benefits
from the investments made and higher Inventory carrying costs.
The Markets for the OE customers stabilized in last quarter of the year
to recover the business situation significantly. As a result, your
company recorded an increase of 2.40 % in the net turnover of Rs
1115.68 crores during the year as against Rs. 1089.58 crores in the
previous year. During the year under review the company has sold
852,925 nos. of A.C. systems as against 895,072 nos. in the previous
year. During the year under review your company was able to achieve
profit after tax of Rs.48.40 cr as against Rs.28.55 cr during the last
year.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors'
Report
EXPANSION AND FUTURE PROSPECTS
Your Company considering the growth in the Automobile sector in
general, has planned its capacity expansion at its existing facilities
at Noida, Manesar and Pune, to cater to the increased demand from
existing as well as new Automobiles manufacturers in India.
The Company has also started the process of setting up its facility in
Chennai, Tamil Nadu for targeting Southern India based OEM. The Company
is also strategically diversifying into other Thermal Engineering
Products for Automobiles Sector or for other industrial uses like
radiators, Engine cooling modules, Bus air-conditioning, Rail
air-conditioning etc.
The Company expects buoyant growth in coming years due to increased
share of business from its existing Customers and expansion of business
in new business domains like Bus Air-conditioning, Truck Refrigeration
and Radiators.
AWARDS AND RECOGNITIONS
The working of your company has always been recognized for improvement
in operational efficiencies, cost control, delivery etc. The Company
was awarded following prestigious awards in the following categories: -
a) MSIL- Gold Trophy for Best Vendor Award for overall performance
b) MSIL- Engineering Director Special award for local R&D setup
c) MSIL- Warranty Improvement
d) MSIL- Incoming Quality Improvement
e) MSIL- Special support award
f) MSIL- Design and Development award.
g) ACMA- Gold Award for Manufacturing Excellence
h) ACAAA-Silver Award for Excellence in Technology
i) Economic Times Gold Award- Manufacturing Excellence
j) Frost and Sullivan -Ranked amongst Top 5 Companies in Customer focus
and Innovation by Frost and Sullivan
k) Excellence award in NCQC (National Quality Circle)
SUBSIDIARY COMPANY
During the financial year under review THAI SUBROS LIMITED subsidiary
Company in Thailand, achieved a turnover of THB 403.11 Lacs as against
THB 667.09 Lacs during the last financial year, the sales has decreased
by 40% over the last year and the company was having Loss after tax of
THB 9.41 Lacs as against profit after tax of THB 21.02 Lacs during the
previous year under review.
CONSOLIDATION OF ACCOUNT
In accordance with the Accounting Standard AS-21 on Consolidated
Financial Statements read with Accounting Standard AS-27 on financial
reporting for interest in Joint Ventures, the Audited Consolidated
Financial Statements are provided in the Annual Report.
CORPORATE GOVERNANCE
The company is committed to maintain the highest standards of Corporate
Governance. The Directors adhere to the requirements set out by the
Securities and Exchange Board of India's Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A separate report on Corporate Governance is provided as a part of the
Annual Report alongwith the Auditors certificate on its compliance.
LISTING
The shares of your company are listed on National Stock Exchange of
India Limited, the Stock Exchange of Mumbai and The Delhi Stock
Exchange Association Ltd. The company has paid annual listing fee for
the year 2012-13 and also paid annual custodian fee in respect of
shares held in dematerialization mode to NSDL and CDSL for the year
2012-13.
FIXED DEPOSIT
During the year the Company has not received any deposits from the
public under section 58A of the Companies Act, 1956 read with the
Companies (Acceptance of Deposit) Rules.
DEMATERIALISATION OF SHARES
To provide better and smooth service to the shareholders, the company's
equity shares have been made available for dematerialization in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL), Mumbai. In order to avail this service,
shareholders can dematerialize the shares in the electronic form.
DIRECTORS
Dr. Jyotsna Suri, Mr. Y Nei and Mr. G.N. Mehra, Directors of the
Company will retire by rotation at the forthcoming Annual General
Meeting and being eligible offer themselves for reappointment.
DIRECTORS' RESPONSIBILITY STATEMENT
As required under section 217(2AA) of the Companies Act, 1956, the
directors hereby confirm that :-
- in the preparation of annual accounts for the year 2011-12, the
accounting standards issued by the Institute of Chartered Accountants
of India and the requirements of the Companies Act, 1956, to the extent
applicable to the company have been followed;
- the Directors have selected such 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 2011 -12 and of the profit
of the company for that period;
- the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of Companies Act, 1956, for safeguarding the assets of the
company and for preventing and detecting fraud and other
irregularities; and
- the Directors had prepared the annual accounts on a going concern
basis.
AUDITORS
M/s. V.K. Dhingra & Co. Chartered Accountants, New Delhi retire at the
forthcoming Annual General Meeting and being eligible, offer themselves
for re-appointment. The notes to account referred to in the Auditors'
Report are self-explanatory.
DISCLOSURE OF INFORMATION WITH REGARD TO CONSERVATION OF ENERGY ETC.
Information relating to Conservation of Energy, Technology Absorption
etc., in terms of Section 217(1 )(e) of the Companies Act read with
relevant rules is annexed herewith.
EMPLOYEES
Information as per Section 217 (2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules. 1975, as amended,
the names and other particulars of the employees are set out in the
annexure to the Directors' Report.
However, having regard to the provisions of Section 219(1 )(b)(iv) of
the Companies Act, 1956, the Annual Report is being sent to all the
shareholders of the Company excluding the statement of particulars of
employees under section 217(2A) of the Companies Act, 1956. Any
shareholder interested in obtaining a copy of the said statement may
write to the Dy. Company Secretary at the registered office of the
Company and same will be sent.
ACKNOWLEDGEMENT
Your Directors wish to convey their appreciation to all the company's
employees for their enormous efforts as well as their collective
contribution to the company's performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Company's Bankers, Canara & other Banks and the Management
of our collaborators, Denso Corporation and Suzuki Motor Corporation,
Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
Company's valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited, for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the Company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place: New Delhi RAMESH SURI
Dated: 28th May, 2012 Chairman
Mar 31, 2011
The Members
The Directors are pleased to present their 26th Annual Report of the
Company together with the AuditedAccounts for the year ended 31st
March, 2011.
FINANCIALRESULTS
Current year Previous year
2010-11 2009-08
(Rs.in Lacs) (Rs. in Lacs)
Gross Profit before
financial charges and
depreciation 9007.36 9401.84
Less: Financial Charges & 1750.36 1603.33
Depreciation 4054.96 5805.32 3847.07 5450.40
Net Profit before
Taxation 3202.04 3951.44
Less: Taxation 347.63 1142.45
Profit after Taxation 2854.41 2808.99
Add: Profit brought forward 13199.41 13080.08
Profit available for
appropriation 16053.82 15889.07
Less: Proposed Dividend 479.91 419.92
Less:- Corporate Dividend Tax 77.85 69.74
Less:- Transfer to General
Reserve 2000.00 2200.00
Balance carried over to 13496.05 13199.41
Balance Sheet
DIVIDEND
Your Company has earned a net profit (after tax) of Rs 2854 Lacs as
against Rs.2809 Lacs in the previous year. Your directors recommend a
dividend of 80 paisa per share (i.e. 40%) on the paid-up equity share
capital for the year ended 31st March, 2011 as against 70 paisa per
share (i.e. 35%) declared in the previous year. The dividend, if
approved by the shareholders at the ensuing Annual General Meeting,
shall absorb a sum of Rs.479.91 lacs exclusive of Dividend Tax.
BUSINESS OPERATIONS
Your Company has continues to scale new heights and set several new
benchmarks in terms of sales and overall operations. The company has
sold 895,072 nos. ofA.C. systems as against 747,707 nos. in the
previous year an increase of 20%. The Company during the current year
despite the pressure of currency fluctuation and higher input cost has
been able to sustain the profit after tax.
The company had also been able to maintain its market leadership with
customer focus and upgraded technology.As a result, your company
recorded an increase of 20% in the net turnover of Rs 1,089.10 crores
during the year as against Rs.905.46 crores in the previous year.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors'
Report
EXPANSION AND FUTURE PROSPECTS
Your Company considering the growth in the Automobile sector in medium
term and in general, has planned its capacity expansion, to cater to
the increased demand from existing as well as new Automobiles
manufacturers in India. Moreover company is continuously engaged in VA
/ VE and localization and as a step in that direction during the year
under review the company was able to localize new generation RS
Evaporator, thereby resulting is savings in term of cost and foreign
exchange.
The Company has also started the process of setting up its new facility
at Chennai, Tamil Nadu targeting Southern India based OEM. The Company
is also strategically diversifying into other Thermal Engineering
Products for Automobiles Sector or for other industrial uses like
radiators, engine cooling modules, Bus airconditioning, Rail
airconditioning etc.
The Company during the last financial year has established a design
Joint venture Company in India with its collaborator Denso Corporation
for carrying out application design services for the development of new
products for the satisfaction of its ultimate customers with low cost
and less lead time in product development.
AWARDS AND RECOGNITIONS
The working of your company has always been recognized for improvement
in operational efficiencies, cost control, delivery etc. The Company
was awarded following prestigious awards in the following categories:
a) Best Vendor Award for overall performance from MSIL.
b) VA VE Implementation Award from MSIL.
c) Warranty Improvement Award from MSIL.
d) Tier 2 Vendor up gradation Award from MSIL.
e) Timely capacity Expansion Award from MSIL.
f) Best vendor award from Mahindra & Mahindra.
g) Gold Award for manufacturing excellence- IMEA
SUBSIDIARY COMPANY
During the financial year under review THAI SUBROS LIMITED subsidiary
Company in Thailand, achieved a turnover of THB 667.09 Lacs as against
THB 268.40 Lacs during the last financial year, the sales has increased
substantially and the Company was having Profit before tax of THB 26.47
Lacs as against profit ofTHB 19.35 Lacs during the previous year under
review.
CONSOLIDATIONOFACCOUNT
In accordance with the Accounting Standard AS-21 on consolidated
financial statements that with Accounting Standard AS-27 on financial
reporting for interest in Joint Ventures, the Audited Consolidated
Financial Statement are provided in theAnnual Report.
CORPORATEGOVERNANCE
The company is committed to maintain the highest standards of Corporate
Governance. The Directors adhere to the requirements set out by the
Securities and Exchange Board of India's Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A separate report on Corporate Governance is provided as a part of the
Annual Report alongwith the Auditors certificate on its compliance.
LISTING
The shares of your company are listed on National Stock Exchange,
Bombay Stock Exchange and The Delhi Stock Exchange Association Ltd. The
company has paid annual listing fee for the year 2011-12 and also paid
annual custodian fee in respect of shares held in dematerialization
mode to NSDL and CDSL for the year 2011-2012.
FIXEDDEPOSIT
During the year the Company has not invited any deposits from the
public under section 58A of the CompaniesAct, 1956 read with the
Companies (Acceptance of Deposit) Rules.
DEMATERIALISATIONOFSHARES
To provide better and smooth service to the shareholders, the company's
equity shares have been made available for dematerialization in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL), Mumbai. In order to avail this service,
shareholders can dematerialize the shares in the electronic form
quickly.
DIRECTORS
Mr. Shinzo Nakanishi, Mr. Shailendra Swarup and Mr.K.R. Ramamoorthy
Directors of the Company, will retire by rotation at the forthcoming
Annual General Meeting and being eligible offer themselves for
reappointment.
DIRECTORS'RESPONSIBILITY STATEMENT
As required under section 217(2)AAof the CompaniesAct, 1956, the
directors hereby confirm that :- Ã in the preparation of annual
accounts for the year 2010-11, the accounting standards issued by the
Institute of Chartered Accountants of India and the requirements of the
Companies Act, 1956, tothe extent applicable to the company have been
followed.
à the Directors have selected such 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 2010-11 and of the profit
ofthe company for that period.
à the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of Companies Act, 1956, for safeguarding the assets of the
company and for preventing and detecting fraud and other
irregularities.
à the Directors had prepared the annual accountson a going concern
basis.
AUDITORS
M/s. V.K. Dhingra & Co. Chartered Accountants, New Delhi retire at the
forthcoming Annual General Meeting and being eligible, offer themselves
for re-appointment. The notes to account referred to in theAuditors'
Report are self-explanatory.
DISCLOSURE OF INFORMATION WITH REGARD TO CONSERVATION OF ENERGY ETC.
Information relating to Conservation of Energy, Technology Absorption
etc., in terms of Section 217(1)(e) ofthe CompaniesAct read with
relevant rules is annexed herewith.
EMPLOYEES
Information as per Section 217 (2A) of the CompaniesAct, 1956, read
with the Companies (Particulars of Employees) Rules. 1975, as amended,
the name and other particulars of the employees are set out in the
annexure tothe Directors' Report.
However, having regard to the provisions of Section 219(1)(b)(iv) of
the Companies Act, 1956, the Annual Report is being sent to all the
shareholders of the Company excluding the statement of particulars of
employees under section 217(2A) of the Companies Act, 1956. Any
shareholder interested in obtaining a copy of the said statement may
write to the Company Secretary at the registered office of the Company
and same will be sent.
ACKNOWLEDGEMENT
Your Directors wish to convey their appreciation to all the company's
employees for their enormous efforts as well as their collective
contribution to the company's record performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Company's Bank, Canara & other Bank and the Management of
our collaborators, Denso Corporation and Suzuki Motor Corporation,
Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
Company's valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the Company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place:New Delhi RAMESH SURI
Dated: 3rdAugust, 2011 Chairman
Mar 31, 2010
The Directors are pleased to present their 25th Annual Report of the
Company together with the Audited Accounts for the year ended 31 st
March, 2010.
FINANCIAL RESULTS
Current year Previous year
2009-10 2008-09
(Rs. in Lacs) (Rs. in Lacs)
Gross Profit before financial
charges and depreciation 9401.84 6473.97
Less: Financial Charges & 1603.33 1459.06
Depreciation 3847.07 5450.40 3156.53 4615.59
Net Profit before Taxation 3951.44 1858.38
Less: Taxation 1142.45 517.14
Profit after Taxation 2808.99 1341.24
Less: Proposed Dividend 419.92 299.94
Less:-Corporate Dividend Tax 69.74 50.98
Less: - Transfer to General Reserve 2200.00 134.12
Balance carried over to 119.33 856.20
Balance Sheet
DIVIDEND
Your Company has earned a net profit (after tax) of Rs.2808.99 Lacs as
against Rs. 1341.24 Lacs in the previous year. Your directors recommend
a dividend of 35% (70 paisa per share) on the paid-up equity share
capital for the year ended 31 st March, 2010 as against 25% (50 paisa
per share) declared in the previous year. The dividend, if approved by
the shareholders at the ensuing Annual General Meeting, shall absorb a
sum of Rs.489.66 lacs exclusive of Dividend Tax.
BUSINESS OPERATIONS
During the year, your Company has scaled new heights and set several
new benchmarks in terms of sales and overall operations. The company
has sold 747,707 nos. of A.C. systems as against 618,752 nos. in the
previous year an increase of 21%. The Company was also able to increase
its profitability by successfully implementing various cost reduction
programs in areas of Material Cost thro Global Sourcing / Value
Engineering and reduction in manufacturing costs. The company has
achieved Rs.28.09 crores Profit after tax which has increased by 109 %
over Rs. 13.41 crores achieved during the previous year.
The company had been able to maintain its market leadership with
customer focus and upgraded technology. As a result, your company
recorded an increase of 25% in the gross turnover of Rs 983.83 crores
during the year as against Rs.786.59 crores in the previous year.
The performance of the company is also discussed in Management
Discussion and Analysis, as stipulated under clause 49 of the Listing
Agreement with the Stock Exchanges, which forms part of the Directors
Report
EXPANSION AND FUTURE PROSPECTS
Your Company considering the growth in the Automobile sector in
general, has planned its capacity expansion, to cater to the increased
demand from existing as well as new Automobiles manufacturers in India.
The Company has also started the process of setting up its facility in
Sanand, Gujarat for effecting supplies to Tata Motors Ltd, for its new
low cost Car "Nano". The sales to Tata Motors Ltd for Nano will
commence during the current financial year.
Your Company is further expanding into newer segments relating to
Thermal Engineering Products for Automobiles Sector or for other
industrial uses like radiators, Engine cooling modules, Bus A/C, Rail
A/C etc. Trial sales for Radiators have already commenced.
The Company has finalized for setting up a design Joint venture Company
in India with its collaborator Denso Corporation for carrying out
application design services for the development of new products for the
satisfaction of its ultimate customers with low cost and less lead time
in product development.
AWARDS AND RECOGNITIONS
The working of your company has always been recognized for improvement
in operational efficiencies, cost control, delivery etc. The Company
was awarded following prestigious awards in the following categories:
a) System rating Award from MSIL.
b) VAVE Award from MSIL.
c) Incoming Quality Improvement from MSIL.
d) Quality Awareness Quiz Award from MSIL.
e) Delivery Award from TATA Motors.
f) National Award for Excellence in Cost Management from ICWAI, India.
g) Quality Circle Technical (North) Award
SUBSIDIARY COMPANY
During the financial year under review THAI SUBROS LIMITED subsidiary
Company in Thailand, achieved a turnover of THB 268.40 Lacs as against
THB 9.42 Lacs during the last financial year, the sales has increased
substantially and the Company was having Profit before tax of THB 19.35
Lacs as against loss of THB 12.11 Lacs during the previous year under
review.
CORPORATE GOVERNANCE
The company is committed to maintain the highest standards of Corporate
Governance. The Directors adhere to the requirements set out by the
Securities and Exchange Board of Indias Corporate Governance practices
as per clause 49 of the Listing Agreement and have implemented all the
stipulations prescribed.
A separate statement on Corporate Governance is provided as a part of
the Annual Report alongwith the Auditors certificate on its compliance.
LISTING
The shares of your company are listed on National Stock Exchange of
India Limited, the Stock Exchange of Mumbai and The Delhi Stock
Exchange Association Ltd. The company has paid annual listing fee for
the year 2010-11 and also paid annual custodian fee in respect of
shares held in dematerialization mode to NSDL and CDSL for the year
2010-11.
FIXED DEPOSIT
During the year the Company has not received any deposits from the
public under section 58Aof the Companies Act, 1956 read with the
Companies (Acceptance of Deposit) Rules and there is no outstanding,
overdue, unclaimed or unpaid deposit at the end of the year.
DEMATERIALISATION OF SHARES
To provide better and smooth service to the shareholders, the companys
equity shares have been made available for dematerialization in
electronic form in the Depository systems operated by National
Securities Depository Limited (NSDL) and Central Depository Services
(India) Limited (CDSL), Mumbai. In order to avail this service,
shareholders can dematerialize the shares in the electronic form
quickly.
DIRECTORS
The present term of Mr. Ramesh Suri as Chairman of the Company expires
on 15th September 2010. The Board of Directors at its meeting held on
2nd August, 2010 re-appointed Mr. Ramesh Suri as Chairman of the
Company for a further period of 5 years w.e.f. 16th September, 2010 on
the same terms and conditions and remuneration.
The requisite resolutions pertaining to the appointment of Mr. Ramesh
Suri as Chairman appeared at item no. 7 of the Notice and relevant
Explanatory statements are recommended to the shareholders for
approval.
Mr. G.N. Mehra, Mr. P. Sabanayagam and Mr. Hanuwant Singh Directors of
the Company, retire by rotation and being eligible offer themselves for
reappointment.
DIRECTORS RESPONSIBILITY STATEMENT
As required under section 217(2)AAof the Companies Act, 1956, the
directors hereby confirm that: -
- In the preparation of annual accounts for the year 2009-10, the
accounting standards issued by the Institute of Chartered Accountants
of India and the requirements of the Companies Act, 1956, to the extent
applicable to the company have been followed.
- The Directors have selected such 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 2009-10 and of the profit
of the company for that period.
- The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of Companies Act, 1956, for safeguarding the assets of the
company and for preventing and detecting fraud and other
irregularities.
- The Directors had prepared the annual accounts on a going concern
basis. AUDITORS
M/s. V.K. Dhingra & Co. Chartered Accountants, New Delhi retire at the
forthcoming Annual General Meeting and being eligible, offer themselves
for re-appointment. The notes to account referred to in the Auditors
Report are self-explanatory.
DISCLOSURE OF INFORMATION WITH REGARD TO CONSERVATION OF ENERGY ETC.
Information relating to Conservation of Energy, Technology Absorption
etc., in terms of Section 217(1 )(e) of the Companies Act read with
relevant rules is annexed herewith.
EMPLOYEES
Information as per Section 217 (2A) of the Companies Act, 1956, read
with the Companies (Particulars of Employees) Rules. 1975, as amended,
the name and other particulars of the employees are set out in the
annexure to the Directors Report.
However, having regard to the provisions of Section 219(1 )(b)(iv) of
the Companies Act, 1956, the Annual Report is being sent to all the
shareholders of the Company excluding the statement of particulars of
employees under section 217(2A) of the Companies Act, 1956. Any
shareholder interested in obtaining a copy of the said statement may
write to the Dy. Company Secretary at the registered office of the
Company and same will be sent.
ACKNOWLEDGEMENT
Your Directors wish to convey their appreciation to all the companys
employees for their enormous efforts as well as their collective
contribution to the companys record performance.
Your Directors acknowledge with gratitude the co-operation and support
extended by Companys Bank, Canara & other Banks and the Management of
our collaborators, Denso Corporation and Suzuki Motor Corporation,
Japan for their continued support.
Your Directors also take this opportunity to convey their thanks to the
Companys valued customers, particularly Maruti Suzuki India Limited,
Tata Motors Limited, Mahindra & Mahindra Limited and Force Motors
Limited for the trust and confidence reposed by them in the Management
for their unstinted co-operation and support provided to the Company.
Your Directors also take this opportunity to convey their thanks to the
shareholders, suppliers, and all the other business associates for the
continuous support given by them to the company and their confidence
reposed in the management.
For and on behalf of Board of Directors
Place: New Delhi RAMESH SURI
Dated: 2nd August, 2010 Chairman
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