Mar 31, 2018
Dear Members,
The Directors have great pleasure in presenting the 32nd Annual Report of your Company, together with the audited financial statement of accounts of the company for the financial year ended 31st March, 2018. Further, the consolidated performance of the company and its subsidiaries has been referred to wherever required.
Financial Results
The highlights of the standalone and consolidated financial performance of the Company are as under:-
(Rs. In lakhs)
Particulars |
|
Consolidated |
||
2017-2018 |
2016-2017 |
2017-2018 |
2016-2017 |
|
Revenue from Operation |
53,838.17 |
49,192.72 |
75,968.11 |
51,489.58 |
Other Income |
1,318.89 |
591.11 |
1,980.99 |
651.6 |
Total Income |
55,157.06 |
49,783.83 |
77,949.10 |
52,141.18 |
Profit before Depreciation, Interest & Taxes (PBDIT) |
8,374.24 |
6,059.66 |
11,445.51 |
6,280.94 |
Depreciation |
2,629.78 |
2,507.62 |
3,942.5 |
2,615.04 |
Profit before Interest & Taxes (PBIT) |
5,744.46 |
3,552.04 |
7,503.01 |
3,665.90 |
Financial Charges |
905.72 |
294.10 |
2,351.19 |
408.09 |
Profit before Taxes (PBT) |
4,838.74 |
3,257.94 |
5,151.82 |
3,257.81 |
Provision for Taxes |
1,647.5 |
1,170.38 |
1,727.48 |
1,243.88 |
Profit after tax (PAT) |
3,191.24 |
2,087.57 |
3,424.34 |
2,013.93 |
Balance of profit brought forward |
19,567.32 |
18,063.42 |
18,270.56 |
18,063.42 |
Balance available for appropriation |
22,788.03 |
20,189.59 |
22,828.15 |
18,892.83 |
Dividend |
516.12 |
516.12 |
516.12 |
516.12 |
Tax on dividend |
105.08 |
106.15 |
105.08 |
106.15 |
Balance Surplus in P & L Account |
22,166.83 |
19,567.32 |
22,206.95 |
18,270.56 |
Paid-up Equity Share Capital |
1,876.80 |
1,876.80 |
1,876.80 |
1876.80 |
Earnings Per Share (EPS) |
17.00 |
11.12 |
18.25 |
10.73 |
General Information
India has emerged as the fastest growing major economy in the world in last few years. Financial Year 2018 marked with both excitement and challenges for the Indian economy. Though there were some adverse conditions but Indiaâs economy started to recover after a slowdown caused by demonetization, followed by Governmentâs courageous decision to implement GST effective July last year. Indeed, growth has been accelerating, covering roller coaster of 5% to above 7%, within the same financial year and closed at 6.6%. Growth in India is projected to increase to 7.4 % in FY 2019 and 7.8 % in FY 2020, lifted by strong private consumption and business friendly government policies.
One of the major job creators, Indian automobile industry is fulfilling its duty well. In parallel, it is biggest FDI earner, GDP contributor. After seeing challenging times, the industry is now in growth mode from last few years. All segments of the automobiles registered good amount of growth the domestic sales of Passenger Vehicles and Commercial Vehicles grew by 7.89% and 19.94 % respectively, during April- March 2018. Two Wheeler remained the spot light with 14.80% growth in domestic sales. Within the Two Wheeler segment, the sales of Scooters/ Scooterette and Motorcycles grew by 19.90% and 13.69% respectively while sales of Mopeds declined by (-) 3.48 in FY 2017-18 over FY 2016-17.
The Indian automobile industry is closely linked to the countryâs Gross Domestic Product (GDP) growth. The overall automobile exports increased by 16.12 %. While Three Wheelers and Two Wheelers registered a growth of 40.13 % and 20.29 % respectively, exports of Passenger Vehicle and Commercial Vehicles declined by (-) 1.51 % and (-) 10.53 % respectively in April-March 2018 over April-March 2017.The Indian auto components industry is going through a transformational period with the concept of mobility changing continuously. The prospects of the Industry is to benefit over next years are good. As you may aware that the Indian auto industry is poised to become the fourth largest manufacturer of automobiles globally by 2020 after China, the US and Japan. Not to mention, India is currently the worldâs second largest two-wheeler manufacturer.
State of Company Affairs
Your Company is one of the few industrial enterprises which have become a world-class Indian brand with a green and sustainable strategy of growth, despite an increasing volatile economic and business environment. Besides being cost competitive, delivering to strict schedules and adhering to high quality standards are the main keys of success for auto component manufacturers, especially to enter into and grow export markets. Your company possesses all the above skills and is appreciated by customers all over the world. Keeping this in mind, your company is today tapping new geographies due to the high potential available in the export markets. Detailed information on the operations and on the state of affairs of the Company are majorly covered in the Management Discussion & Analysis Report, forming part of this report. The performance of the Company was in line with the growth of Auto Industries. During the FY 2017-18, the total revenue stood at Rs. 55,157.06 lakhs as compared to Rs. 49,783.83 lakhs in the last FY 2016-17, registering a growth of 10.79%. The profit before tax stood at Rs 4,838.74 lakhs as compared to Rs 3,257.94 lakhs in previous year. Similarly, the Net profit after tax of the Company is Rs. 3,191.24 lakhs as compared to Rs 2,087.57 lakhs in previous year, registering robust growth of 52.87%.
On a consolidated basis, the total revenue was Rs. 77,949.10 lakhs as compared to Rs. 52,141.18 lakhs in the previous FY. Similarly, the Net profit after tax was Rs. 3,424.34 lakhs as compared to Rs. 2,013.93 lakhs in previous FY.
At the export front, the Company also did well and recorded an export turnover of Rs. 10,343.82 Lakhs as compared to Rs. 10,517.53 Lakhs in the previous year, hereby recorded an increase by 24.02% as compared to the percentage during the same period in the previous year. The total export turnover now 23.64% of the total turnover of the Company.
Your Company expects to benefit over the next period from its good business linkage with OEMs, due to its healthy operating efficiencies. In view of this, the long term prospects of your Company are bright.
Consolidated Financial Statements
In accordance with the provisions of the Companies Act, 2013 (âthe Actâ) and IndAS-110 on Consolidated Financial Statements, read with IndAS-28 on Investments in Subsidiaries outside India, the Audited Consolidated Financial Statements for the FY ended March 31, 2018 are provided in this Annual Report.
Share Capital
The paid up Equity Share Capital as on 31st March, 2018 was Rs. 1876.80 Lakhs. During the year under review, the Company has not issued shares or granted stock options or sweat equity.
Dividend
During the year under review and based on the performance of the company, an interim dividend of 15% i.e. Rs. 1.50 per equity share amounting to Rs. 281.52 Lakhs was declared and paid, the same is being confirmed at the forthcoming AGM. Further, the Directors have now recommended to the shareholders a final dividend for the FY 2017-18 of 20% i.e. Rs. 2.00 per equity share, resulting in an another payout of Rs. 375.36 Lakhs. The total dividend payout stands at Rs. 656.88 Lakhs (Previous year Rs. 469.20 Lakhs) & tax on dividend comes to Rs 134.99 Lakhs (Previous year Rs. 95.52 Lakhs).
If the final dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their forthcoming 32nd Annual General Meeting of the company, payment of such dividend will be made to those members whose names appear in the Register of Members as per Book closure dates mentioned in the shareholderâs information.
Change in the nature of business
There was no change in the nature of the business of the company during the financial year 2017-18.
Directors Responsibility Statement
In terms of section 134(3) (c) & 134 (5) of the Companies Act, 2013, and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
(a) that in preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any,
(b) that such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2018 and of the profit of the Company for the year ended on that date,
(c) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
(d) that the annual financial statements have been prepared on going concern basis,
(e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively, and
(f) that the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
Details of Internal Financial Controls with reference to the Financial Statement
In view of the requirement of the Companies Act, 2013, the Company has successfully documented its Internal Financial Controls (IFC). This ensures orderly and efficient conduct of its business, including adherence to Company policies, safeguarding of its assets, accuracy, prevention of errors & completeness of the accounting records and the timely preparation of reliable financial information. The Internal Financial Controls with reference to the Financial Statements were adequate and operating effectively.
Further, the Company has adopted Indian Accounting Standard (IndAS) with effect from April 01, 2017 and accordingly standalone un-audited quarterly financial results for the quarters during the financial year have been prepared in accordance with the recognition and measurements laid down in IndAS and prescribed under section 133 of the Companies Act, 2013 read with relevant rules issued thereunder.
Details of Subsidiary/Joint Ventures/Associate Companies During the financial year 2017-18, the Company incorporated a Wholly Owned Subsidiary Company in US in the name of âNeo-Tech Auto Systemz Inc.â and subscribed 10,00,000 common shares of CAD $ 0.01 each.
As on March 31, 2018, the Company has Eight (08) Wholly Owned Subsidiaries (including step-down subsidiaries) in Canada and US viz. 2545887 Ontario Inc. (â254â), 2504584 Ontario Inc. (â250â), 2323532 Ontario Inc. (â232â), Teutech Industries Inc., Teutech Holding Co., Teutech Leasing Co., Teutech LLC and Neo-Tech Auto Systemz Inc. (Seven (07) subsidiaries as on March 31, 2017). There has been no material change in the business of the subsidiaries. There is no reverse investment by the subsidiary companies in the share capital of the Company.
The Board have duly reviewed the affairs of the subsidiary companies, from time to time wherein, â254â and âTeutechâ are considered to be âMaterial Subsidiaryâ companies, pursuant to provisions of Regulation 24 of the SEBI (LODR) Regulations, 2015. Further, there is no material change in the subsidiary companies and the Company has taken note of all the significant transactions and arrangements entered into by its subsidiaries. The other financial and vital details related to subsidiaries are provided in MGT-9 (Extract of Annual Return) & AOC-1 (Statement containing salient features of the financial statement of subsidiaries) attached to this Report, pursuant to section 129(3) and section 136 of the Companies Act, 2013 and rules made thereunder.
In accordance with the provisions of the Companies Act, 2013 and applicable accounting standards the standalone and consolidated financials together with the reports of Statutory Auditors are provided in the Annual Report.
Directors, Key Managerial Personnelâs and Evaluation
The Board is duly constituted with proper balance of Executive, NonExecutive, Independent Directors & Whole Time Directors. The Independent Directors have given declaration regarding their meeting of criteria of independence as provided in section 149(6) of the Companies Act, 2013. The other information is as under:-
a. Retire by Rotation
Independent Directors are not liable to retire by rotation. Pursuant to the provision of Section 152(6) of the Companies Act, 2013 Mr. Bidadi Anjani Kumar (DIN: 00022417), Non Executive Director, being longest in the office, retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for the reappointment.
b. Key Managerial Personnel
All Whole Time Directors such as Mr. Deep Kapuria, Executive Chairman, Mr. Pranav Kapuria, Managing Director and Mr. Anuj Kapuria, Executive Director are regarded as KMPs, in addition to Chief Financial Officer (C.F.O.) and Company Secretary (C.S.).
c. Independent Directors
The Board has 6 (Six) Independent Directors, including one Woman Director, representing diversified fields and expertise. Details are provided in the appropriate section of the Corporate Governance Report.
The Independent Directors have submitted their declarations of independence, as required pursuant to provisions of section 149(7) of the Act and the Listing Regulations, stating that they meet the criteria of independence as provided in sub-section (6) of section 149 of Companies Act, 2013 and Listing Regulations.
d. Meetings of the Board
The Board met 5 (five) times during the period 2017-18 to conduct the operations of the Company. The details are given in the Corporate Governance Report, which forms part of this Annual Report. It is confirmed that the gap between two consecutive meetings was not more than one hundred and twenty days as provided in section 173 of the Act.
e. Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015, the Board carried out an formal annual performance evaluation of its own performance, the Chairman, directors individually and the working of the different committees. Such evaluation was done through the established evaluation framework suggested by the NRC and the SEBI Guidance Note. The framework included different tools such as individual questionnaire, covering various information required to have the evaluation. All the layers of the Board, such as Board, Committees and the Independent Directors performed their part by evaluating the performances of the holders as mandated.
Auditors
a) Statutory Auditors
M/s O P Dadu & Co., Chartered Accountants, (Firm Registration No. 001201N) the Statutory Auditors of the Company, which was appointed in the 31st Annual General Meeting for the period of five years till the conclusion of 36th Annual General Meeting of the Company to be held in the year 2022-23 subject to their ratification by the shareholders of the Company at every Annual General Meeting of the Company at a remuneration as may be decided by shareholders. They have furnished a certificate confirming the eligibility under section 141 of the Companies Act, 2013 and Rules made thereunder.
Pursuant to the provisions of Companies (Amendment) Act, 2017 read with MCA notification dated 07th May, 2018, which provides that the requirement of the ratification of a Statutory Auditor at every annual general meeting of the company has been omitted. Therefore, no resolution shall be taken into for the ratification of a statutory Auditor at the forthcoming 32nd Annual General Meeting of the Company.
The Auditorsâ Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors as provided under Section 134 of the Act with respect to the point no. (vii) (b) in Annexure âAâ to Auditorsâ Report relating to non deposit of disputed taxes. The Board wishes to inform that those matters are related to regular income tax matters for which the Company has preferred appeal to Appellate Authorities. The necessary explanations are also provided in Note 39A(2) to the Standalone Financial Statements. The rest of report by the Statutory Auditors is self explanatory. Please refer to the Notes to Accounts, wherever necessary.
b) Cost Auditors
The provisions relating to section 148(1) read with rules are applicable, accordingly cost accounts and records are made and maintained.
Further, as per Section 148 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the Board of Directors have on the recommendation of the Audit Committee, approved the re-appointment of M/s. Kabra & Associates, Cost Accountants as the Cost Auditors of the Company for the year ending 2018-2019. The remuneration proposed to be paid to them requires ratification of the shareholders of the Company. In view of this, your approval for payment of remuneration to Cost Auditors is being sought at the ensuing Annual General Meeting. Accordingly, a resolution seeking approval by members for the remuneration payable to M/s Kabra & Associates is included in the Notice convening 32nd Annual General Meeting.
c) Secretarial Auditor
The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards.
As per Section 204 of the Companies Act, 2013 inter-alia requires every listed company to annex with its Boardâs Report, a Secretarial Audit Report provided by a Company Secretary in Practice, in the prescribed format. The Board of Directors appointed M/s Grover Ahuja & Associates, Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company and their report is annexed to this Board report (Annexure-I). The Secretarial Audit Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors under the Act.
Internal Control Systems and its Adequacy The Company has internal control systems commensurate with the size, scale and complexity of its business operations. The scope and functions of Internal Auditors are defined and reviewed by the Audit committee. Internal Auditors present their quarterly report to the Audit Committee, highlighting various observations, system and procedure related lapses, if any and corrective actions being taken to address them.
Investor Education and Protection Fund (âIEPFâ)
Pursuant to section 124, 125 and applicable provisions of the Companies Act, 2013 and Rules made there under, all unpaid or unclaimed dividends are required to be transferred by the Company to IEPF after the completion of seven years from the date of declaration of dividend. Similarly, the MCA has notified Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 effective from 7th September 2016 which provide that, the shares in respect of which dividend has not been claimed or unpaid by the shareholders for seven consecutive years or more shall also be transferred to the demat account(s) to be prescribed by the IEPF Authority.
The details of such dividend and shares transferred pursuant to the aforesaid provisions are provided in General Shareholder information section at point No. 10 of Section XII of Corporate Governance Report and Note No. 8 of the Notice of ensuring 32nd Annual General Meeting.
In terms of the said Rules and the amendment thereof vide notification dated 28th February, 2017 and 13th October, 2017, the necessary communications have been made to the respective shareholders whose shares were required to be transferred to the IEPF so as to enable them to claim their dividend attached to such shares before such dividend and shares are transferred to IEPF and further, the necessary information in this regard is available on the website of the Company i.e. www.thehitechgears.com for the convenience of the shareholders.
In view of this, those shareholders whose dividend is unpaid or unclaimed must claim it at the earliest. The equity shares once transferred into IEPF can only be claimed by the concerned shareholder from IEPF Authority after complying with the procedure prescribed under the Rules and any amendment thereof.
Accordingly, during the financial year 2017-18, the Company has transferred 10,420 and 821 equity shares to the IEPF Authority, in two tranches in respect of which the amount of dividend has not been claimed or unpaid for the consecutive seven years to the concerned shareholders from the date of declaration respectively. A list of such cases is available at the company website.
Extract of Annual Return
As required pursuant to section 92(3) & 134 (3) (a) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in MGT-9 as a part of this Annual Report as Annexure II.
The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo
Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of Section 134(3) (m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014, are given in Annexure III, to this Report.
Report on Corporate Governance
The Report on Corporate Governance is given separately and forming part of this report and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is also attached to the report.
Management Discussion & Analysis Report
The Management Discussion & Analysis Report is given separately and forming part of this report together with its contents.
Risk Management Policy
Pursuant to Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, provisions of constituting Risk Management Policy are not applicable to the Company.
Corporate Social Responsibility
Pursuant to the provisions of Section 135 and other applicable provisions of the Companies Act, 2013 and Rules made thereunder the Company have adopted & developed a Policy covering the activities mentioned in Schedule VII of Companies Act, 2013, upon the recommendation of CSR Committee. Implementation of the policy is undertaken under the guidance of Committee and a brief of the Corporate Social Responsibility is provided in Annexure-IV.
Particulars of contracts or arrangements with related parties
All transactions entered by the Company with the parties, which may be regarded with related parties, were considered to be in the ordinary course of business and on the armâs length basis. As provided under section 134(3)(h) of the Act and Rules made thereunder, disclosure of particulars of material transactions with related parties entered into by the Company with related parties in the prescribed format annexed to this report as Annexure-V. Disclosures on related party transactions are also set out in Note No. 37 to the financial statements. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at the link www.thehitechgears.com.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic learing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Companyâs Registrar and Share Transfer Agent (RTA). Members are holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken for the purpose of ECS and the Company.
Postal Ballot
During the financial year 2017-18, no Resolution was required to be passed through postal ballot. Similarly, at the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot is being placed.
Code of Conduct of Insider Trading
The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders. This Code of Conduct is intended to prevent misuse of Unpublished Price Sensitive Information (âUPSIâ) by designated persons.
In accordance with such Code of Conduct, the Company closes its trading window for Designated Persons from time to time. The trading window is also closed during and after occurrence of price sensitive events as per the said Code of Conduct.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company.
The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance Report.
Reconciliation of Share Capital Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2018 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange of India Limited (NSE) and the Bombay Stock Exchange India Limited (BSE) Mumbai. Pursuant to Regulation 14 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the annual listing fees for the year 2017-18 and 2018-19 has been paid within the prescribed time period.
Fixed Deposits
During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 73 of the Companies Act, 2013, and rules made there under.
Dematerialization of the equity shares
99.45% of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.
Particulars of Employees
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure VI.
Remuneration Policy
In terms of provisions of Section 178 of the Companies Act, 2013 read with Regulation 19 of the Listing Regulations, a policy relating to remuneration for the Directors, Key Managerial Personnel and other employees has been adopted by the Board of Directors of the Company in pursuance of its formulation and recommendation by the Nomination and Remuneration Committee thereby analyzing the criteria for determining qualifications, positive attributes and independence of a Director. The said policy available on the website of the Company at www.thehitechgears.com.
Audit Committee
Company has duly constituted Audit Committee, which meets on regular intervals for the business required to be transacted thereat. The recommendations made by such committee are accepted by the Board. A synopsis is described in the Corporate Governance Report.
Vigil Mechanism Policy
The Company has a vigil mechanism policy to deal with any instance of fraud and mismanagement. The employees of the Company are free to report violations of any laws, rules, regulations and concerns about unethical conduct to the Audit Committee under this policy. The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination with any person for a genuinely raised concern. The policy may be accessed on the Companyâs website at www.thehitechgears.com.
Obligation of Company under the Sexual Harassment Of Women At Workplace (Prevention, Prohibition And Redressal) Act, 2013
The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Accordingly, the company has set up Committee for implementation of said policy.
Further, during the year Company has not received any complaint of harassment.
Particulars of Loans given, Investments made, Guarantees given and Securities provided
The Company has not given any loans or guarantee covered under the provisions of section 186 of the Companies Act, 2013.
The details of the investments made by the Company are given in the notes to the financial statements.
Material changes and Commitments
There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year to which the financial statements relate and the date of the report.
Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companyâs operations in future
There is no significant and/or material order passed by the regulators or courts or tribunals impacting the going concern status of the Company. Business Responsibility Reporting
As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 of Business Responsibility Reporting is not applicable to the Company.
Personnel
The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organisation at every level. The efforts to create a family like atmosphere continued throughout the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company. The Company encourages by rewarding & recognising employees for their long term commitment as & when the opportunity arise.
Trade Relations
The Board of Directors place on record their appreciation for the cooperation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.
Acknowledgment
Your directors place on record their sincere appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the employees of the Company at all levels.
The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company.
By Order of the Board
For The Hi -Tech Gears Limited
Place : New Delhi Deep Kapuria
Dated : August 03, 2018 Chairman
Mar 31, 2016
Dear Members,
The Directors have great pleasure in presenting the 30th Annual Report of your Company, together with the audited statement of accounts for the financial year ended 31st March, 2016.
Financial Results
The highlights of the financial performance of the Company are as under:-
(Rs. in lacs)
Particulars |
2015-2016 |
2014-15 |
Sales (net of excise duty) |
44,997.29 |
43,192.84 |
Other Income |
227.63 |
266.46 |
Total Income |
45,224.92 |
43,459.30 |
Profit before Depreciation, Interest & Taxes (PBDIT) |
5,882.30 |
5,509.05 |
Depreciation |
2,273.09 |
2,510.86 |
Profit before Interest & Taxes (PBIT) |
3,609.21 |
2,998.19 |
Financial Charges |
249.27 |
368.63 |
Profit before Taxes (PBT) |
3,359.94 |
2,629.56 |
Provision for Taxes |
1,243.52 |
787.85 |
Profit after tax (PAT) |
2,116.42 |
1,841.71 |
Balance of profit brought forward |
10,309.05 |
9,863.70 |
Balance available for appropriation |
12,425.48 |
11,705.42 |
Dividend |
563.04 |
469.20 |
Tax on dividend |
116.77 |
93.81 |
Transfer to General Reserve |
100.00 |
100.00 |
Balance Surplus in P & L Account |
11,645.67 |
10,309.05 |
Paid-up Equity Share Capital |
1,876.80 |
1,876.80 |
Earnings Per Share (EPS) |
11.28 |
9.81 |
General Information
India topped the World Bank''s growth outlooks for 2015-16 for the first time with the economy having grown 7.6% in 2015-16 and is expected to grow at 7-7.75% during FY 2016-17, despite the uncertainties in the global market according to IMF World Economic Outlooks.
After seeing challenging times, the Indian automobile industry finally in growth mode from few years. Although, the revival is good for the industry, Manufacturing Sector & Economy as such, but the pace of growth is still to go very far. It is heartening to inform that all the vehicle categories, be it commercial vehicle or two vehicle saw the positive territory. The overall production of vehicle stood at 23,960,940 Vehicles compared to 23,358,047
Indian auto component industry registered a growth of 8.8% in 201516 with overall turnover of Rs. 2,55,600 crores (USD 39.0 billion). While overall exports from India witnessed de-growth of 9.58%, however the Indian auto component industry exports grew by 3.5% reaching to Rs. 709,00 crores (USD 10.8 billion). ACMA President predicted that with the signs of recovery in India based auto market and prospects of a better monsoon, the component sector is expected to witness growth in double digits this year.
International Monetary Fund (IMF) earlier projected the global growth at 3.5%. However, due to moderate and uneven reasons, it remained at 3.1% for 2015 and is projected to grow at 3.2% in 2016, the same level 2015. Weak trade growth, sluggish investment, subdued wages and slower activity in key emerging markets will all contribute to modest global GDP growth and is expected to improve only to 3.5% in 2017. This reflects a combination of subdued aggregate demand, poor underlying supply-side developments, with weak investment, trade and productivity growth, and diminished reform momentum.
Operations
Detailed information on the operations of the Company and details on the state of affairs of the Company are covered in the Management Discussion & Analysis Report, forming part of this report. Further with regard to the financials, this year also growth of your Company has been satisfactory and up to the expectation. During the FY 2015-16, total revenue from operations (net of excise) stood at Rs.449.97 crores as compared to Rs.431.92 crores in FY 2014-15, registering an increase of 4.18%. The profit before tax stood at Rs 33.60 crores as compared to Rs 26.30 crores in previous year. Similarly, the Net profit after tax of the Company also grew by 14.91% i.e. from Rs 18.42 crores to Rs 21.16 crores.
At the export front, the Company also did well and recorded an export turnover of Rs. 107.84 crores compare to Rs. 93.17 crores in the previous year, thereby recorded an increase of 15.75% compared to 12% during the same period in previous year. The total exports are now 23.85% of the total turnover.
Your Company expects to benefit over the next period from its good business linkage with OEMs, due to its healthy operating efficiencies. In view of this, the tong term prospects of your Company are bright.
Share Capital
The paid up Equity Share Capital as on 31st March 2016 was Rs. 18,76,80,000. During the year under review, the Company has not issued shares or granted stock options or sweat equity.
Dividend
During the year under review, an interim dividend of 15 % i.e. Rs. 1.50 per equity share amounting to Rs. 281.52 lacs was declared and paid, the same is being confirmed at the forthcoming AGM. The Directors have now recommended to the shareholders a final dividend of 15% i.e. Rs. 1.50 per equity share, resulting in an another payout of Rs. 281.52 lacs. The total dividend payout stands at Rs 563.04 Lacs (Previous year Rs 469.20 Lacs) & tax on dividend comes to Rs 116.77 Lacs (Previous year 93.81 Lacs). Additionally, an amount of Rs. 1.00 Crore is transferred to General Reserve.
If the final dividend on the shares as, recommended by the Board of Directors, is approved by the shareholders in their 30th Annual General Meeting, payment of such dividend will be made to those members whose names appear in the Register of Members as per Book closure dates mentioned in the shareholderâs information.
Directors Responsibility Statement
In terms of section 134(3) (c) & 134 (5) of the Companies Act, 2013, and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
(a) that in preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any,
(b) that such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2016 and of the profit of the Company for the year ended on that date,
(c) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
(d) that the annual financial statements have been prepared on going concern basis,
(e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively, and
(f) that the systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.
Details of Internal Financial Controls with reference to the Financial Statement
In view of the requirement of the Companies Act, 2013, the Company has successfully documented its Internal Financial Controls (IFC). This ensures orderly and efficient conduct of its business, including adherence to Company policies, safeguarding of its assets, accuracy prevention of errors & completeness of the accounting records and the timely preparation of reliable financial information.
The Internal Financial Controls with reference to the Financial Statements were adequate and operating effectively
Details of Subsidiary/Joint Ventures/Associate Companies
The Company has neither any Subsidiary, Joint Venture nor an Associate Company within the meaning of Companies Act, 2013. However, the Company is evaluating various options to tap the business opportunities in South India as well as in overseas through itself/entity(ies).
Directors and KMP''s appointment/ reappointment
The Board is duly constituted with proper balance of Executive Directors, Non-Executive Directors, Independent Directors & Whole Time Directors. The other information is as under:
a. Retire by Rotation
Independent Directors are not liable to retire by rotation. Mr. Anuj Kapuria, Whole Time Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment.
b. Additional Director
Mr. Bidadi Anjani Kumar was appointed as a Non- Executive and Additional Director of the Company who holds the office till the date of ensuing Annual General Meeting. His appointment is being confirmed at the ensuing Annual General Meeting subject to your approval.
c. Re-appointment of Managerial Personal
Last appointment of Mr. Deep Kapuria as the Executive Chairman and Whole Time Director was made for 5 Years with effect from January 01, 2012 up to December 31, 2016 and his tenure is coming to an end on December 31, 2016. The Board of Directors upon the recommendation of Nomination and Remuneration Committee has re-appointed them for another period of five (5) years, subject to your approval.
d. Key Managerial Personnel''s
All Whole Time Directors such as Mr. Deep Kapuria, Executive Chairman, Mr. Pranav Kapuria, Managing Director and Mr. Anuj Kapuria, Executive Director are regarded as KMPs, in addition to Chief Financial Officer (C.F.O.) and Company Secretary (C.S.).
Necessary Resolutions for the appointment/reappointment of Directors/Whole Time Directors pursuant to provisions of the Companies Act, 2013 & Rules made there under and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 are being included in the notice for the ensuing Annual General Meeting for the approval of shareholders.
During the year, Mr. PC. Mathew an Independent director of the Company resigned and Mr. Bidadi Anjani Kumar has joined the Board as Non-Executive Director. Detailed information regarding directors is provided in the Corporate Governance Report.
Meetings of the Board
Necessary Board Meetings transacted to conduct the operations of the Company. The details are given in the Corporate Governance Report, which forms part of this Annual Report. It is confirmed that the gap between two consecutive meetings was not more than one hundred and twenty days as provided in section 173 of the Act.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and the corporate governance requirements as prescribed by SEBI ( Listing Obligations and Disclosure Requirements) Regulations, 2015 , the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees.
Declaration of Independent Director(s)
The Independent Directors have submitted their declarations of independence, as required pursuant to provisions of section 149(7) of the Act, stating that they meet the criteria of independence as provided in sub-section (6).
Auditors
a) Statutory Auditors
M/s Gupta Vigg & Company, Chartered Accountants, (Firm Registration No. 001393N) Statutory Auditors of the Company hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. Pursuant to provisions of section 139 of the Act and the Rules made there under, the Board upon the recommendation of Audit Committee proposes to reappoint M/s Gupta Vigg & Company Chartered Accountants as Statutory Auditors of the Company till the conclusion of the next Annual General Meeting. They have furnished a certificate confirming the eligibility under section 141 of the Act and Rules made there under.
The Auditors'' Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors as provided under Section 134 of the Act. With respect to the point no. (VII) (b) in Annexure to Auditors'' Report with regard to non deposit of disputed taxes. the Board wishes to inform that those matters are related to non-admission of service tax input by the Excise Department, & regular income tax matters for which the Company has preferred appeal to Appellate Authorities. The rest of report by the Statutory Auditors is self explanatory Please refer to the Notes to Accounts, wherever necessary.
b) Cost Auditors
As per Section 148 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the Board of Directors have on the recommendation of the Audit Committee, approved the reappointment of M/s. Kabra & Associates, Cost Accountants as the Cost Auditors of the Company for the year ending 31st March, 2017. The remuneration proposed to be paid to them requires ratification of the shareholders of the Company. In view of this, your approval for payment of remuneration to Cost Auditors is being sought at the ensuing Annual General Meeting. Accordingly, a resolution seeking approval by members for the remuneration payable to M/s Kabra & Associates is included in the Notice convening 30th Annual General Meeting.
c) Secretarial Auditor
Section 204 of the Companies Act, 2013 inter-alia requires every listed company to annex with its Board''s report, a Secretarial Audit Report provided by a Company Secretary in Practice, in the prescribed form. The Board of Directors appointed M/s Grover Ahuja & Associates, Practicing Company Secretaries as Secretarial Auditor to conduct Secretarial Audit of the Company and their report is annexed to this Board report (Annexure I). The Secretarial Audit Report does not contain any qualification, reservation or adverse remark and do not call for any further explanation/ clarification by the Board of Directors under the Act.
Internal Control Systems and its Adequacy
The Company has internal control systems commensurate with the size, scale and complexity of its business operations. The scope and functions of Internal Auditors are defined and reviewed by the Audit committee. Internal Auditors present their quarterly report to the Audit Committee, highlighting various observations, system and procedure related lapses, if any and corrective actions being taken to address them.
Extract of Annual Return
As required pursuant to section 92(3) & 134 (3) (a) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in MGT 9 as a part of this Annual Report as Annexure II.
The Conservation of Energy, Technology Absorption, Foreign Exchange earnings and outgo.
Details of Energy Conservation, Technology Absorption, Research & Development activities undertaken by the Company and foreign exchange earnings and outgo of the Company and other information in accordance with the provisions of Section 134(3) (m) of the Companies Act, 2013, read with the Companies (Disclosure of Particulars in the Report of Board of Directors), Rules, 1988, are given in Annexure III, to this Report.
Report on Corporate Governance
The Report on Corporate Governance is given separately and forming part of this report and the certificate from the Statutory Auditors confirming compliance with the provisions of Corporate Governance as stipulated in Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is also attached to the report.
Management discussion & analysis report
The Management Discussion & Analysis Report is given separately and forming part of this report.
Risk Management Policy
Pursuant to Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, provisions of constituting Risk Management Policy are not applicable to the Company.
Corporate Social Responsibility
Pursuant to the provisions of Section 135 and other applicable provisions of the Companies Act, 2013 and Rules made there under the brief of the Corporate Social Responsibility is provided in Annexure IV
Particulars of contracts or arrangements with related parties
All transactions entered by the Company with the parties, which may be regarded with related parties, were considered to be in the ordinary course of business and on the arm''s length basis. As provided under section 134(3)(h) of the Act and Rules made there under disclosure of particulars of material transactions with related parties entered into by the Company with related parties in the prescribed format annexed to this report as Annexure V. Disclosures on related party transactions are also set out in Note No. 31 to the financial statements. The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link: http://www.hitechgears.com/images/RPT.pdf.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India (SEBI), companies should mandatorily use the facility of Electronic Clearing Services (ECS), for distribution of dividends to its members. This facility provides to the members an opportunity to receive dividend amount directly in their bank accounts. For availing this facility, members holding shares in physical form may send their duly filled ECS mandate form to the Company''s Registrar and Share Transfer Agent (RTA). Members are holding shares in dematerialized form may kindly note that their bank account details as furnished to their depositories will be taken for the purpose of ECS and the Company.
Postal Ballot
During the financial year 2015-16, no Resolution was required to be passed through postal ballot. Similarly, at the forthcoming Annual General Meeting, there is no item for approval through Postal Ballot is being placed.
Code of Conduct of Insider Trading
The Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders. This Code of Conduct is intended to prevent misuse of Unpublished Price Sensitive Information (âUPSIâ) by designated persons.
In accordance with such Code of Conduct, the Company closes its trading window for Designated Persons from time to time. The trading window is also closed during and after occurrence of price sensitive events as per the said Code of Conduct.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and Senior Management personnel. The code of conduct has also been posted on the official website of the Company.
The Declaration by the Managing Director of the Company regarding compliance with the Code of Conduct for Board Members and Senior Management is annexed with the Corporate Governance Report.
Reconciliation of Share Capital Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out the Secretarial Audit on quarterly basis to reconcile the total issued and listed share capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). The Board of Directors confirms that the total issued and paid up capital as on 31st March, 2016 is reconciled with the total number of shares in physical form and the total number of dematerialized shares held with NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is being submitted every quarter to the Stock Exchanges and is also placed before the Board Meeting.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company the equity shares of your Company are presently listed on the premier stock exchanges viz., the National Stock Exchange of India Limited (NSE) and the Bombay Stock Exchange India Limited (BSE) Mumbai. Pursuant to Regulation 14 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the annual listing fees for the year 2016-2017 has been paid within the prescribed time period.
Fixed Deposits
During the year under review your Company neither invited nor accepted any deposit within the meaning of Section 73 of the Companies Act, 2013, and rules made there under.
Dematerialization of the equity shares
99.32 % of the total equity shares of the Company are held in dematerialized form with the participants of National Securities Depository Limited (NSDL) and Central Depository Securities (India) Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge the shareholders holding shares in physical form to get their shares dematerialized.
Change of Name
The name of the Company has been changed by prefixing âTheâ before the existing name of the Company, making it âThe Hi-Tech Gears Limitedâ which was approved by the members in 29th Annual General Meeting of the Company. The fresh Certificate of Incorporation in this regard has been issued by Registrar of Companies, Jaipur (âROC'') dated October 08, 2015.
Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.
Audit Committee
Company has duly constituted Audit Committee, which meets on regular intervals for the business required to be transacted thereat. The recommendations made by such committee are accepted by the Board.
As per Companies Act, 2013, the Company has reconstituted and revised the roles, responsibilities & powers of the Audit Committee. A synopsis is described in the Corporate Governance report.
Vigil Mechanism Policy
The Company has a vigil mechanism policy to deal with any instance of fraud and mismanagement. The employees of the Company are free to report violations of any laws, rules, regulations and concerns about unethical conduct to the Audit Committee under this policy The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination with any person for a genuinely raised concern. The policy may be accessed on the
Company''s website at the link: http://www.hitechgears.com/images/ Vigil_Mechanism_Poficy.pdf
Obligation of Company under the Sexual Harassment Of Women At Workplace (Prevention, Prohibition And Redressal) Act, 2013
Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said poficy. During the year Company has not received any complaint of harassment.
Particulars of Toans given, Investments made, Guarantees given and Securities provided
The company has not given any toans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.
The details of the investments made by company are given in the notes to the financial statements.
Material changes and Commitments
There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year to which the financial statements relate and the date of the report.
Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future
There is no significant and/or material order passed by the regulators or courts or tribunals impacting the going concern status of the Company.
Particulars of Employees
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure VI.
Business Responsibility Reporting
As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 of Business Responsibility
Reporting is not applicable.
Personnel
The Board of Directors place on record their appreciation of the untiring efforts of the employees of the organization at every level. The efforts to create a family like atmosphere continued throughout the year. Like the many years gone-by, this year also witnessed increased cohesion among all levels of employees, which is evident from the performance of the Company. Training and Development of employees provided further impetus and have contributed towards the all round improved performance of your company. The Company encourages by rewarding & recognizing employees for their tong term commitment as & when the opportunity arise.
Trade Relations
The Board of Directors place on record their appreciation for the co-operation and valuable support extended by the customers, the suppliers and all other persons directly or indirectly associated with the Company. Your Company regards them as partners and shares with them a common vision of growth in the future.
Acknowledgement
Your directors place on record their sincere appreciation for the assistance, cooperation and valuable support provided to the Company by Customers, Vendors, Banks & Financial Institutions and hope to continue to receive the same in future. Your Directors also record their appreciation for the commitment and dedication of the employees of the Company at all levels.
The Board of Directors also place on record their gratitude to the shareholders of the Company for their continued support to and confidence in the management of the Company
By Order of the Board
For The Hi-Tech Gears Limited
Sd/-
Place : New Delhi Deep Kapuria
Dated: 11/08/2016 Chairman
Mar 31, 2015
Dear Members,
The Directors have great pleasure in presenting the 29th Annual Report
of your Company, together with the audited statement of accounts for
the financial year ended 31st March, 2015.
Financial Results
The highlights of the financial performance of the Company are as
under:-
(Rs. in lacs)
Particulars 2014-2015 2013-14
Sales (net of excise duty) 43,192.84 36,102.05
Other Income 266.46 518.48
Total Income 43,459.30 36,620.53
Profit before Depreciation,
Interest & Taxes (PBDIT) 5,509.05 5,102.41
Depreciation 2,510.86 2,306.09
Profit before Interest
& Taxes (PBIT) 2,998.19 2,796.33
Financial Charges 368.63 590.37
Profit before Taxes (PBT) 2,629.56 2,205.96
Provision for Taxes 787.85 613.43
Profit after tax ( PAT) 1,841.71 1,592.53
Balance of profit brought forward 9,863.70 9,030.11
Balance available
for appropriation 11,705.42 10,622.64
Dividend 469.20 469.20
Tax on dividend 93.81 79.74
Transfer to General Reserve 100.00 160.00
Balance Surplus in P & L Account 10,309.05 9,863.70
Paid-up Equity Share Capital 1,876.80 1,876.80
Earnings Per Share (EPS) 9.81 8.49
General Information
The FY 2014-15 has witnessed key policy reforms, aimed at aiding growth
revival and surmounting the structural constraints in the Indian
Economy. The Indian Economy grew at 7.3 % in FY 2014-15. The Economy
posted a 7.5 % growth in the January to March quarter of the fiscal,
outpacing China's GDP of 7 % in that quarter. Growth rebounded in the
three most crucial components of industrial sector i.e. mining,
manufacturing and electricity. The latest policy initiative of the
Indian Government "Make in India" is a welcome move for the growth of
Indian Economy.
Automobile Sector showed growth both in Domestic as well as Export
Sales. FY 2014-15 numbers reveal all vehicle categories other than
Commercial Vehicles are in positive territory. Riding on the back of a
gradual uplift in market sentiments, excise duty cuts continuing
through to December 2014 and the opening up of the mining and
infrastructure sectors, the Indian automotive industry posted an
overall growth of 7.22 % in FY 2014-15, as compared to 3.53 % in the
previous fiscal year.
According to International Monetary Fund, the global economy is
expected to grow at 3.5% in 2015 and 3.8% in 2016. However, Global
recovery will continue to be moderate and uneven. While developed
economies are expected to strengthen, aided by lower oil prices and low
interest rates, most emerging economies are expected to slow down
moderately, due to country specific reasons-with India being an
exception. The Indian economy is expected to grow by 7.5% in 2015-16.
Growth will benefit from recent policy reforms, a consequent pick-up in
investment, and lower oil prices". Demand is expected to grow due to
various underlying factors including "Make in India", "Digital India",
raising per capita income, growing urbanization etc.
Operations
Growth of your Company has been satisfactory and upto the expectation.
During the FY 2014-15, total revenue from operations (net of excise)
stood at Rs.431.92 crores as compared to Rs 361.02 crores in FY
2013-14, registering an impressive increase of 19.63%. The profit
before tax stood at Rs 26.30 crores as compared to Rs 22.07 crores in
previous year. Similarly, the Net profit of the Company also grew by
15.65% i.e. from Rs 15.94 crores to Rs 18.41 crores.
Exports of our country were not much encouraging due to massive
fluctuation of the exchange rate, recession in the world economy & the
pressure of rising raw material cost. Still, your company's export
sales were increased by 12% with export revenue of Rs 94.12 crores in
the FY 2014-15 as compared to previous year of Rs 84.04 crores,
registering a growth of 12%. This was made possible, because of your
Company's continuing efforts to tap new customers and markets.
Your Company expects to benefit over the next period from its good
business linkage with OEMs, due to its healthy operating efficiencies.
In view of this, the long term prospects of your Company are bright.
Share Capital
The paid up Equity Share Capital as on 31st March 2015 was Rs.
18,76,80,000. During the year under review, the Company has not issued
shares or granted stock options or sweat equity.
Dividend
During the year under review, an interim dividend of 10 % i.e. Rs. 1.0
per equity share amounting to Rs. 187.68 lacs was declared and paid,
the same is being confirmed at the forthcoming AGM. The Directors have
now recommended to the shareholders a final dividend of 15% i.e. Rs.
1.50 per equity share, resulting in a payout of Rs. 281.52 lacs. The
total dividend payout stands at Rs 469.20 Lacs (Previous year Rs 469.20
Lacs) & tax on dividend comes to Rs 93.81 Lacs (Previous year 79.74
Lacs). Additionally, an amount of Rs. 1.00 Crore is transferred to
General Reserve.
If the dividend on the shares as, recommended by the Board of
Directors, is approved by the shareholders in their 29th Annual General
Meeting, payment of such dividend will be made to those members whose
names appear in the Register of Members as per Book closure dates
mentioned in the shareholder's information.
Directors Responsibility Statement
In terms of section 134(3) (c) & 134 (5) of the Companies Act, 2013,
and to the best of their knowledge and belief, and according to the
information and explanations provided to them, your Directors hereby
make the following statements:
(a) that in preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanations
relating to material departures, if any,
(b) that such accounting policies have been selected and applied
consistently and judgments and estimates made that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as on March 31, 2015 and of the profit of the Company for
the year ended on that date,
(c) that proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Act for safeguarding the assets of the Company and for prevention and
detection of fraud and other irregularities,
(d) that the annual financial statements have been prepared ongoing
concern basis,
(e) that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively, and
(f) that the systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
Details of Subsidiary/Joint Ventures/Associate Companies
The Company has neither any Subsidiary, Joint Venture nor an Associate
Company within the meaning of Companies Act, 2013. However, the Company
is evaluating various options to tap the business opportunities in
North American Free Trade Agreement (NAFTA) region by having an entity.
Directors and KMP's appointment/ reappointment
a. Retire by Rotation
Independent Directors are not liable to retire by rotation. Mr. Pranav
Kapuria, Managing Director of the Company, retire by rotation at the
ensuing Annual General Meeting and being eligible offer himself for
re-appointment.
b. Additional Director
Ms. Malini Sud was appointed as an Independent and
Additional Director of the Company who holds the office till the date
of ensuing Annual General Meeting. Her appointment is being confirmed
at the ensuing Annual General Meeting subject to your approval.
c. Re-appointment of Managerial Personal
Mr. Pranav Kapuria and Mr. Anuj Kapuria have completed their tenure as
the Managing Director and the Whole Time Director respectively. The
Board of Directors upon the recommendation of Nomination and
Remuneration Committee has re-appointed them for another period of five
(5) years, subject to your approval.
d. Key Managerial Personnel's
All Whole Time Directors such as Mr. Deep Kapuria, Executive Chairman,
Mr. Pranav Kapuria, Managing Director and Mr. Anuj Kapuria, Executive
Director are regarded as KMPs, in addition to Chief Financial Officer
(C.F.O.) and Company Secretary (C.S.). Mr. S.K. Khatri is the
continuing C.S. of the Company. Mr. Vijay Mathur, Sr. General Manager
(Finance) was regularized as C.F.O. He resigned from the post of
C.F.O. w.e.f. 30th November, 2014, upon the appointment of Mr. Alok
Agarwal as the C.F.O. w.e.f. 1st December, 2014. However, Mr. Vijay
Mathur will Continue to work as Sr. General Manager (Finance).
Resolutions for the said appointment/reappointment of Directors
pursuant to Section 149 & 152 of the Companies Act, 2013 & Rules made
there under & Clause 49 of the Listing Agreement are being included in
the notice for the ensuing Annual General Meeting for the approval of
shareholders.
There is no other change in the Directors during the FY 2014-15.
Meetings of the Board
Necessary Board Meetings transacted to conduct the operations of the
Company. The details are given in the Corporate Governance Report,
which forms part of this Annual Report. It is confirmed that the gap
between two consecutive meetings was not more than one hundred and
twenty days as provided in section 173 of the Act.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, the Board has carried out an annual performance
evaluation of its own performance, the directors individually as well
as the evaluation of the working of its Committees.
Declaration of Independent Director(s)
The Independent Directors have submitted their declarations of
independence, as required pursuant to provisions of section 149(7) of
the Act, stating that they meet the criteria of independence as
provided in sub-section (6).
Auditors
a) Statutory Auditors
M/s Gupta Vigg & Company, Chartered Accountants, (Firm Registration No.
001393N) Statutory Auditors of the Company hold office until the
conclusion of the ensuing Annual General Meeting and are eligible for
reappointment. Pursuant to provisions of section 139 of the Act and the
Rules made thereunder, the Board upon the recommendation of Audit
Committee proposes to reappoint M/s Gupta Vigg & Company, Chartered
Accountants as Statutory Auditors of the Company till the conclusion of
the next Annual General Meeting. They have furnished a certificate
confirming the eligibility under section 141 of the Act and Rules made
there under.
The Auditors' Report does not contain any qualification, reservation or
adverse remark and do not call for any further explanation/
clarification by the Board of Directors as provided under Section 134
of the Act. With respect to the point no. (VII) (b) in Annexure to
Auditors' Report with regard to non deposit of disputed taxes. The
Board wishes to inform that the matters are related to non- admission
of service tax input by the Excise Department, others such as Entry tax
& regular income tax matter for which the Company has preferred appeal
to Appellate Authorities. The rest of report by the Statutory Auditors
is self explanatory. Please refer to the Notes to Accounts, wherever
necessary.
b) Cost Auditors
As per Section 148 and all other applicable provisions of the Companies
Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014,
the Board of Directors has on the recommendation of the Audit
Committee, approved the re-appointment of M/s. Kabra & Associates, Cost
Accountants as the Cost Auditors of the Company for the year ending 31
March, 2016. The remuneration proposed to be paid to them requires
ratification of the shareholders of the Company. In view of this, your
ratification for payment of remuneration to Cost Auditors is being
sought at the ensuing AGM. Accordingly, a resolution seeking
ratification by members for the remuneration payable to M/s Kabra &
Associates is included at Item No. 10 of the Notice convening 29th
Annual General Meeting.
c) Secretarial Auditor
Section 204 of the Companies Act, 2013 inter-alia requires every listed
company to annex with its Board's report, a Secretarial Audit Report
provided by a Company Secretary in Practice, in the prescribed form.
The Board of Directors appointed M/s Grover Ahuja & Associates,
Practicing Company Secretaries as Secretarial Auditor to conduct
Secretarial Audit of the Company and their report is annexed to this
Board report (Annexure I). The Secretarial Audit Report does not
contain any qualification, reservation or adverse remark and do not
call for any further explanation/ clarification by the Board of
Directors under the Act.
Internal Control Systems and its Adequacy
The Company has internal control systems commensurate with the size,
scale and complexity of its business operations. The scope and
functions of Internal Auditors are defined and reviewed by the Audit
committee. Internal Auditors present their quarterly report to the
Audit Committee, highlighting various observations, system and
procedure related lapses and corrective actions being taken to address
them.
Extract of Annual Return
As required pursuant to section 92(3) & 134 (3) (a) of the Companies
Act, 2013 and rule 12(1) of the Companies (Management and
Administration) Rules, 2014, an extract of Annual Return in MGT 9 as a
part of this Annual Report as Annexure II
The Conservation of Energy, Technology Absorption, Foreign Exchange
earnings and outgo.
Details of Energy Conservation, Technology Absorption, Research &
Development activities undertaken by the Company and foreign exchange
earnings and outgo of the Company and other information in accordance
with the provisions of Section 134(3) (m) of the Companies Act, 2013,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors), Rules, 1988, are given in Annexure III, to this
Report.
Report on Corporate Governance
The Report on Corporate Governance is given separately and forming part
of this report and the certificate from the Statutory Auditors
confirming compliance with the provisions of Corporate Governance as
stipulated in Clause 49 of the listing agreement is also attached to
the report.
Management discussion & analysis report
The Management Discussion & Analysis Report is given separately and
forming part of this report.
Corporate Social Responsibility
Pursuant to the provisions of Section 135 and other applicable
provisions of the Companies Act, 2013 and Rules made there under the
brief of the Corporate Social Responsibility is provided in Annexure IV
Particulars of contracts or arrangements with related parties
All transactions entered by the Company with the parties, which may be
regarded with related parties, were in the ordinary course of business
and on the arm's length basis. Necessary resolution for your approval
is being placed at the ensuing Annual General Meeting, for your
approval. As provided under section 134(3)(h) of the Act and Rules made
there under disclosure of particulars of material transactions with
related parties entered into by the Company with related parties in the
prescribed format annexed to this report as Annexure V Disclosures on
related party transactions are also set out in Note No. 31 to the
financial statements. The Policy on materiality of related party
transactions and dealing with related party transactions as approved by
the Board may be accessed on the Company's website at the link: http://
www.hitechgears.com/images/RPT.pdf.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India
(SEBI), companies should mandatorily use the facility of Electronic
Clearing Services (ECS), for distribution of dividends to its members.
This facility provides to the members an opportunity to receive
dividend amount directly in their bank accounts. For availing this
facility, members holding shares in physical form may send their duly
filled ECS mandate form to the Company's Registrar and Share Transfer
Agent (RTA). Members are holding shares in dematerialized form may
kindly note that their bank account details as furnished to their
depositories will be taken for the purpose of ECS and the Company.
Postal Ballot
During the financial year 2014-15, no Resolution was required to be
passed through postal ballot. Similarly, at the forthcoming Annual
General Meeting, there is no item for approval through Postal Ballot is
being placed.
Code of Conduct of Insider Trading
The Company has adopted a Code of Conduct to regulate, monitor and
report trading by insiders This Code of Conduct is intended to prevent
misuse of Unpublished Price Sensitive Information ("UPSI") by
Designated persons.
In accordance with such Code of Conduct, the Company closes its trading
window for Designated Persons from time to time. The trading window is
also closed during and after occurrence of price sensitive events as
per the said Code of Conduct.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and
Senior Management personnel. The code of conduct has also been posted
on the official website of the Company.
The Declaration by the Managing Director of the Company regarding
compliance with the Code of Conduct for Board Members and Senior
Management is annexed with the Corporate Governance Report.
Reconciliation of Share Capital Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out
the Secretarial Audit on quarterly basis to reconcile the total issued
and listed share capital with National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL). The
Board of Directors confirms that the total issued and paid up capital
as on 31st March, 2015 is reconciled with the total number of shares in
physical form and the total number of dematerialized shares held with
NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is
being submitted every quarter to the Stock Exchanges and is also placed
before the Board Meeting.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the
equity shares of your Company are presently listed on the premier stock
exchanges viz., the National Stock Exchange of India Limited (NSE) and
the Bombay Stock Exchange India Limited (BSE) Mumbai. Pursuant to
Clause 38 of the Listing Agreement, the annual listing fees for the
year 2015-2016 has been paid within the prescribed time period.
Fixed Deposits
During the year under review your Company neither invited nor accepted
any deposit within the meaning of Section 73 of the Companies Act,
2013, and rules made there under.
Dematerialization of the equity shares
99.28 % of the total equity shares of the Company are held in
dematerialized form with the participants of National Securities
Depository Limited (NSDL) and Central Depository Securities (India)
Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge
the shareholders holding shares in physical form to get their shares
dematerialized.
Change of Name
The Board of Directors propose to change the name of the Company by
prefixing "The" before the existing name of the Company, making it "The
Hi-Tech Gears Limited". Registrar of Companies, Jaipur have conveyed
its name availability approval by vide its letter dated 7th August,
2015. A Special Resolution in this respect is being moved for your
approval at the ensuing 29th Annual General Meeting. After your
approval necessary formalities will be completed, for Change of name.
Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection and appointment of Directors,
Senior Management and their remuneration. The Remuneration Policy is
stated in the Corporate Governance Report.
Audit Committee
Company has duly constituted Audit Committee, which meets on regular
intervals for the business required to be transacted thereat. The
recommendations made by such committee are accepted by the Board.
As per Companies Act, 2013, the Company has reconstituted and revised
the roles, responsibilities & powers of the Audit Committee. A synopsis
is described in the Corporate Governance Report.
Vigil Mechanism Policy
The Company has a vigil mechanism policy to deal with any instance of
fraud and mismanagement. The employees of the Company are free to
report violations of any laws, rules, regulations and concerns about
unethical conduct to the Audit Committee under this policy. The policy
ensures that strict confidentiality is maintained whilst dealing with
concerns and also that no discrimination with any person for a
genuinely raised concern. The policy may be accessed on the Company's
website at the link: http://www.hitechgears.com/
images/Vigil_Mechanism_Policy.pdf
Obligation of Company under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 Company has adopted a
policy for prevention of Sexual Harassment of Women at workplace and
has set up Committee for implementation of said policy. During the year
Company has not received any complaint of harassment.
Particulars of Loans given, Investments made, Guarantees given and
Securities provided
The company has not given any loans or guarantees covered under the
provisions of section 186 of the Companies Act, 2013.
The details of the investments made by company are given in the notes
to the financial statements.
Material changes and Commitments
There are no material changes and commitments affecting the financial
position of the Company which have occurred between the end of the
Financial Year to which the financial statements relate and the date of
the report.
Details of significant and material orders passed by the regulators or
courts or tribunals impacting the going concern status and company's
operations in future
There is no significant and/or material order passed by the regulators
or courts or tribunals impacting the going concern status of the
Company.
Particulars of Employees
Disclosures pertaining to remuneration and other details as required
under Section 197(12) of the Act read with Rule 5 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 are
given in Annexure VI
Risk Assessment and Mitigation Process
Company has a risk assessment policy which is periodically reviewed by
the Audit Committee and Board of Directors in their meeting and it
takes the appropriate measures.
Business Responsibility Reporting
As per Clause 55 of the Listing Agreement with the Stock Exchanges
Business Responsibility Reporting is not applicable.
Personnel
The Board of Directors place on record their appreciation of the
untiring efforts of the employees of the organization at every level.
The efforts to create a family like atmosphere continued throughout the
year. Like the many years gone-by, this year also witnessed increased
cohesion among all levels of employees, which is evident from the
performance of the Company. Training and Development of employees
provided further impetus and have contributed towards the all round
improved performance of your company. The Company encourages by
rewarding & recognizing employees for their long term commitment as &
when the opportunity arise.
Trade Relations
The Board of Directors place on record their appreciation for the
co-operation and valuable support extended by the customers, the
suppliers and all other persons directly or indirectly associated with
the Company. Your Company regards them as partners and shares with them
a common vision of growth in the future.
Acknowledgement
Your directors place on record their sincere appreciation for the
assistance, cooperation and valuable support provided to the Company by
Customers, Vendors, Banks & Financial Institutions and hope to continue
to receive the same in future. Your Directors also record their
appreciation for the commitment and dedication of the employees of the
Company at all levels.
The Board of Directors also place on record their gratitude to the
shareholders of the Company for their continued support to and
confidence in the management of the Company.
By Order of the Board
For Hi - Tech Gears Limited
Sd/-
Place:New Delhi Deep Kapuria
Dated:11/08/2015 Chairman
Mar 31, 2014
Dear Members,
The Directors have great pleasure in presenting the 28th Annual Report
of your Company, together with the audited statement of accounts for
the financial year ended 31st March, 2014.
Financial Results
The highlights of the financial performance of the
Company are as under:-
(Rs. in lacs)
Particulars 2013-2014 2012-2013
Sales (net of excise duty) 36102.05 37337.83
Other Income 518.48 200.14
Total Income 36620.53 37537.98
Profit before Depreciation, 5102.41 5441.63
Interest & Taxes (PBDIT)
Depreciation 2306.09 2315.87
Profit before Interest & Taxes 2796.32 3125.76
(PBIT)
Financial Charges 590.36 761.81
Profit before Taxes (PBT) 2205.96 2363.95
Provision for Taxes 613.43 742.60
Profit after tax (PAT) 1592.53 1621.35
Balance of profit brought 9030.11 8186.25
forward
Balance available for 10622.64 9807.60
appropriation
Dividend 469.20 469.20
Tax on dividend 79.74 78.29
Transfer to General Reserve 160.00 180.00
Balance Surplus in P & L 9863.70 9030.11
Account
Paid-up Equity Share Capital 1876.80 1876.80
Earnings Per Share (EPS ) 8.49 8.64
General Information
In India GDP Growth rate stood at 4.7% in 2013-14 compare to 4.5% in
previous year. Sluggish gains in agricultural and manufacturing output,
lower demand in all sectors, high inflation and high interest rates
were key restraining factors. Other factors responsible for the lower
growth include the slowing global economy, delay in implementation of
projects, and the policy logjam leading to a negative business
sentiment.
Depreciation of Indian Currency to the extent of Rs. 69/ $ added more
stinkers, before stabilizing Rs. 60.50/$. Except two-wheelers, which
has major chunk of automatic scooters, performance of Indian Auto-
Industry was not upto the mark. As we know the Automobile and Auto
Component Sector go hand in hand, thus the auto-component Sector also
faced negative growth in FY 2013-14 by registering negative growth of 2
% in FY 2013-14.
Some signs of recovery was visible in the second half of the year.
Global Economy is expected to recover moderately, particularly on
account of better performance of some advanced economies. At domestic
front narrowing CAD, new stable government & moderation in inflation
would ease the monetary policy stance & may revive the confidence of
investors. The economy can look forward to better growth prospective in
2014-15 & beyond. Economic survey expects a GDP growth of 5.4 % to 5.9%
in 2014-15 & if the situation improve, it could push up to 7-8% in
coming years.
Operations
Despite, the adverse & discouraging factors, your Company could level
the turnover. The revenues of the Company (net of excise duty) stood at
Rs 361.02 crores in 2013-14 as compared to Rs 373.38 crores in 2012-13.
The net profit (after tax) of the Company has marginally decreased from
Rs 16.22 crores to Rs 15.93 crores, as compared to the previous year.
Surplus available in P& L account stood at Rs 98.64 Crores, compared to
Rs 90.30 crores in previous year.
Even though, exports suffered due to volatility in the exchange rate &
the pressure of rising raw material cost, but the overall export
remained satisfactory. The Export sales of the Company were higher in
FY 2013-14 as compared to the previous year. Your Company recorded a
total export turnover of Rs 83.34 crores as compared to export sales of
Rs 60.00 crores in the previous year. Thus an impressive increase of
38.90 % was registered.
The long term prospects are however still bright & the demand will grow
due to various underlying factors including India''s rising per capita
income, increasing rural demand, growing urbanization, swelling
replacement demand etc.
Existing customers have assured to provide the new sales target. Thus
the company will have in positive directions to increase the sales &
profitability of the Company.
Dividend
Considering almost the same performance of the Company, similar
dividend policy was approved by your Board, an interim dividend of 10 %
i.e. Rs. 1.0 per equity share amounting to Rs. 187.68 lacs was declared
and paid, the same is being confirmed at the forthcoming AGM. The
Directors have now recommended to the shareholders a final dividend of
15% i.e. Rs. 1.50 per equity share, resulting in a payout of Rs.
281.52 lacs. The total dividend payout stands at Rs 469.20 Lacs
(Previous year Rs 469.20 Lacs) & tax on dividend comes to Rs 79.74 Lacs
(Previous year 78.29 Lacs).
If the dividend on the shares as, recommended by the Board of
Directors, is approved by the shareholders in their 28th Annual General
Meeting, payment of such dividend will be made to those members whose
names appear in the Register of Members as per Book closure dates
mentioned in the shareholder''s information.
In addition to above, the Board proposes to transfer an amount of Rs
1.60 crore to General Reserve in compliance to the requirements of
Section 205(2A) of the Companies Act, 1956.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India
(SEBI), companies should mandatorily use the facility of Electronic
Clearing Services (ECS), for distribution of dividends to its members.
This facility provides to the members an opportunity to receive
dividend amount directly in their bank accounts. For availing this
facility, members holding shares in physical form may send their duly
filled ECS mandate form to the Company''s Registrar and Share Transfer
Agent (RTA). Members holding shares in dematerialized form may kindly
note that their bank account details as furnished to their depositories
will be taken for the purpose of ECS and the Company. Shareholders who
wish to change their bank account details are therefore requested to
advise their depository''s participants about such changes.
Those shareholders who have not yet opted for the ECS facility are once
again requested to avail the benefits of ECS.
Postal Ballot
During the financial year 2013-14, no Special Resolution was required
to be passed through postal ballot. At the forthcoming Annual General
Meeting, there is no item for approval through Postal Ballot.
Code for Prevention of Insider Trading Practices
In compliance with the SEBI (Prohibition of Insider Trading)
Regulations, 1992, your Company has adopted a Code of Conduct for
Prevention of Insider Trading Practices for its Directors and
designated employees. The code lays down guidelines, which include
procedures to be followed, and disclosures to be made while dealing in
the shares of the Company.
Trading Window
In accordance with the Code of Conduct for prevention of insider
trading, the Company closes its trading window for designated employees
and directors from time to time. As per the policy, the trading window
closes for a period of 7 (seven) days, prior to the date of the Board
Meeting and opens 24 hours after the conclusion of Board Meeting in
which the respective quarterly/half yearly/ yearly financial results
are approved. The trading window is also closed during and after
occurrence of price sensitive events as per the Code of Conduct for
prevention of insider trading.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and
Senior Management personnel. The code of conduct has also been posted
on the official website of the Company.
The Declaration by the Managing Director of the Company regarding
compliance with the Code of Conduct for Board Members and Senior
Management is annexed with the Corporate Governance report.
Reconciliation of Share Capital Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out
the Secretarial Audit on quarterly basis to reconcile the total issued
and listed share capital with National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL). The
Board of Directors confirms that the total issued and paid up capital
as on 31st March, 2014 is reconciled with the total number of shares in
physical form and the total number of dematerialized shares held with
NSDL and CDSL. The Reconciliation of Share Capital Audit Certificate is
being submitted every quarter to the Stock Exchanges and is also placed
before the Board Meeting.
Subsidiary Company
The Company has no subsidiary during the financial year 2013-14.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the
equity shares of your Company are presently listed on the premier stock
exchanges viz., the National Stock Exchange of India Limited (NSE) and
the Bombay Stock Exchange Limited (BSE) Mumbai. Pursuant to Clause 38
of the Listing Agreement, the annual listing fees for the year
2014-2015 has been paid within the prescribed time period. It is
further confirmed that custodian fee to NSDL/CDSL for the year 2014-15
has also been paid.
Dematerialization of the equity shares
99.02 % of the total equity shares of the Company are held in
dematerialized form with the participants of National Securities
Depository Limited (NSDL) and Central Depository Securities (India)
Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge
the shareholders holding shares in physical form to get their shares
dematerialized.
Directors
Mr. Ramesh Chandra Jain, Director of the Company, retire by rotation at
the ensuing Annual General Meeting and being eligible offer himself for
re-appointment. Mr. Vinit Taneja, Mr. P.C. Mathew, Mr. Prosad
Dasgupta, Mr. K.C. Verma, Mr. Sandeep Dinodia & Mr. Anil Kumar Khanna
are the Non Executive & Independent Directors of the Company are being
appointed as Independent Directors in terms of section 149 & 152 of the
companies Act, 2013 for 5 (five) consecutive years from the date of the
28th Annual General Meeting. Independent Directors will not be liable
to retire by rotation as per the Companies Act, 2013.
Mr. Deep Kapuria, Executive Chairman & Whole Time Director, Mr. Pranav
Kapuria, Managing Director & Mr. Anuj Kapuria, Whole Time Director are
the Executive Directors of the Company.
A brief profile of the directors proposed to be appointed/re-appointed
pursuant to Section 152 & 149 of the Companies Act, 2013 & Rules made
thereunder & Clause 49 VI (A) of the Listing Agreement is being annexed
to the Notice convening the 28th Annual General Meeting.
Auditors
M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of
the Company retire at the conclusion of the Annual General Meeting of
the Company and being eligible, have offered themselves for
re-appointment. The Company has received an eligibility certificate
from the auditors under Section 139 & 141 & other applicable Provisions
of the Companies Act, 2013. The Board of Directors recommends their re-
appointment for another term of 1 (one) year.
With respect to the point no. 9 (b) in Annexure to Auditors'' Report
with regard to non deposit of disputed taxes, the Board wishes to
inform that the matters are related to non-admission of service tax
input by the Excise Department, others such as Entry tax & regular
income tax matter for which the Company has preferred appeal to
Appellate Authorities. The rest of report by the Statutory Auditors is
self explanatory. Please refer to the Notes to Accounts, wherever
necessary.
Directors Responsibility Statement
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Board of Directors
of your Company confirms:
a. That the applicable accounting standards have been followed in the
preparation of final accounts for the year ended March 31, 2014 and
that there are no material departures.
b. That such accounting policies have been selected and applied
consistently and such judgments and estimates made are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2014 and of the profit of the Company for
the year ended on that date.
c. That proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and
preventing and detecting fraud and other irregularities, and
d. That the annual accounts for the year ended March 31, 2014 have
been prepared on a going concern basis.
Audit Committee
Company has duly constituted Audit Committee, which meets on regular
intervals for the business required to be transacted there at. The
recommendations made by such committee are accepted by the Board.
As per Companies Act, 2013, the Company has reconstituted and revised
the roles, responsibilities & powers of the Audit Committee. A synopsis
is described in the Corporate Governance report as per Annexure III
attached.
Particulars of Employees
Information in accordance with the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975 as amended, is given in Annexure-I, to this report.
The Conservation of Energy, Technology Absorption, Foreign Exchange
earnings and outgo.
Your Company continuously strives for Safety, Environment Management
and conservation of resources like fuel, water, gas and power.
Therefore, emphasis is being laid on employing sophisticated techniques
which result in conservation of natural resources like energy, fuel
etc.
Your company gives high priority to safety which envisages a zero
accident policy as the only acceptable standard of performance.
Details of Energy Conservation, Technology Absorption, Research &
Development activities undertaken by the Company and foreign exchange
earnings and outgo of the Company and other information in accordance
with the provisions of Section 217(1) (e) of the Companies Act, 1956,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors), Rules, 1988, are given in Annexure-II, to this
Report.
Corporate Governance
The Report on Corporate Governance is attached herewith in
Annexure-III, and the certificate from the Statutory Auditors
confirming compliance with the provisions of Corporate Governance as
stipulated in Clause 49 of the listing agreement is also attached to
the report.
Management discussion & analysis report
The Management Discussion & Analysis Report is given separately and
forming part of this report.
Trade Relations
The Board of Directors place on record their appreciation for the
co-operation and valuable support extended by the customers, the
suppliers and all other persons directly or indirectly associated with
the Company. Your Company regards them as partners and shares with them
a common vision of growth in the future.
Public Deposits
During the year under review your Company neither invited nor accepted
any deposit within the meaning of Section 58-A of the Companies Act,
1956, and rules made thereunder.
Personnel
The Board of Directors place on record their appreciation of the
untiring efforts of the employees of the organisation at every level.
The efforts to create a family like atmosphere continued throughout the
year. Like the many years gone-by, this year also witnessed increased
cohesion among all levels of employees, which is evident from the
performance of the Company. Training and Development of employees
provided further impetus and have contributed towards the all round
improved performance of your company. The Company encourages by
rewarding & recognising employees for their long term commitment as &
when the opportunity arise.
Corporate Social Responsibility Committee
Pursuant to the provisions of the Companies Act, 2013, the Company
constituted CSR Committee in the commencement of FY 2013-14. A brief of
the committee is provided in Corporate Governance as per Annexure III
attached.
Acknowledgement
Your directors place on record their sincere appreciation for the
assistance, cooperation and valuable support provided to the Company by
Customers, Vendors, Banks & Financial Institutions and hope to continue
to receive the same in future. Your Directors also record their
appreciation for the commitment and dedication of the employees of the
Company at all levels.
The Board of Directors also place on record their gratitude to the
shareholders of the Company for their continued support to and
confidence in the management of the Company.
By Order of the Board
For Hi - Tech Gears Limited
Sd/-
Place: New Delhi Deep Kapuria
Dated: 07/08/2014 Chairman
Mar 31, 2012
Dear Members,
The Directors have great pleasure in presenting the 26th Annual Report
of your Company, together with the audited statement of accounts for
the financial year ended 31st March, 2012.
Financial Results
The highlights of the financial performance of the Company are as
under:-
(Rs.in lacs)
Particulars 2011-2012 2010-2011
Sales (net of excise duty) 49748.43 42493.15
Other Income 349.79 246.38
Total Income 50098.22 42739.53
Profit before Depreciation, Interest
& Taxes (PBDIT) 8974.87 7641.06
Depreciation 1982.28 1618.71
Profit before Interest & Taxes (PBIT) 6992.59 6022.35
Financial Charges 741.40 756.16
Earning before Taxes (PBT) 6251.19 5266.19
Provision for Taxes 2039.78 1762.72
Profit after tax (PAT) 4211.41 3503.47
Balance of profit brought forward 5456.41 3276.53
Balance available for appropriation 9667.82 6780.00
Dividend 844.56 750.72
Tax on dividend 137.01 122.87
Transfer to General Reserve 450.00 400.00
Balance Surplus in P & L Account 8186.25 5456.41
Paid-up Equity Share Capital 1876.80 1876.80
Earnings Per Share (EPS) 22.44 18.67
Operations
The year gone by proved to be an anothersuccessful year forthe
performance of your company and remained good for exports. The revenues
of the Company (net of excise duty) increased to Rs. 49748.43 lacs in
2011-12 as compared to Rs. 42493.15 lacs in 2010-11, thus registering
an impressive increase of 17.07 %.
The Indian automobile industry grew by almost 14% as compared to 27% in
the previous year due to the low demand in domestic market. Demand for
cars including low end hetchbacks fell for the first time in three
years. Sales in commercial vehicles were moderate & in three wheeler
segment, negative growth was noted. Two wheeler remain the star
performer with a share of 77% in total automobile sale. The growth of
the Company is better compare to market conditions. The Net Profit
(aftertax) of the Company has increased from Rs. 3503.47 lacs to Rs.
4211.41 lacs, recording an increase of 20.21% as compared to the
previous year.
The year under review saw an increase in demand forthe company's
products in both the domestic and exports markets.
Exports
The Export Sales were the most encouraging during the year under
review. The automobile Industry was able to post almost 25% increase by
exporting 2.91 million units. Your Company also recorded a total
export turnover of Rs. 127.45 crores as compared to export sales of Rs.
90.02 crores in the previous year, thus registering an increase of 41
%. The higher exports were made possible because your company
penetrated the European and Latin American markets also in addition to
US market. The Customers in those countries recognized & accepted the
quality of products offered by the Company to their satisfaction.
Dividend
During the year, an interim dividend of 20 % i.e. Rs. 2.0 per equity
share amounting to Rs. 375.36 lacs was declared and paid the same is
being confirmed at the forthcoming AGM. The Directors have now
recommend to the shareholders a final dividend of 25% i.e. Rs. 2.50 per
equity share subject to the approval of the shareholders at the ensuing
Annual General Meeting resulting in a payout of Rs. 469.20 lacs. The
total dividend payout stands at Rs 844.56 Lacs (Previous year Rs 750.72
Lacs) & tax on dividend comes to Rs 137.01 Lacs (Previous year 122.87
Lacs)
If the dividend on the shares as, recommended by the Board of
Directors, is approved by the shareholders in their 26th Annual General
Meeting, payment of such dividend will be made to those members whose
names appear in the Register of Members as perthe book closure dates
mention in the shareholders information.
In addition to above the Board proposes to transfer an amount of Rs
45,000,000/- to General Reserve in compliance to the requirements of
Section 205(2A) of the Companies Act, 1956.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India
(SEBI), companies should mandatorily use the facility of Electronic
Clearing Services (ECS), for distribution of dividends to its members.
This facility provides to the members an opportunity to receive
dividend amount directly in their bank accounts. For availing this
facility, members holding shares in physical form may send theirduly
filled ECS mandate form to the Company's Registrar and Share Transfer
Agent (RTA). Members holding shares in dematerialized form may kindly
note that their bank account details as furnished to their depositories
will be taken forthe purpose of ECS and the Company. Shareholders who
wish to change their bank account details are therefore requested to
advise their depository's participants about such changes.
Those shareholders who have not yet opted forthe ECS facility are once
again requested to avail the benefits of ECS.
Postal Ballot
During the financial year 2011 -12, no Special Resolution was required
to be passed through postal ballot. At the forthcoming Annual General
Meeting, there is no item for approval through Postal Ballot.
Code for Prevention of Insider Trading Practices
In compliance with the SEBI (Prohibition of Insider Trading)
Regulations, 1992, your Company has adopted a Code of Conduct for
Prevention of Insider Trading Practices for its Directors and
designated employees. The code lays down guidelines, which include
procedures to be followed, and disclosures to be made while dealing in
the shares of the Company.
Trading Window
In accordance with the Code of Conduct for prevention of insider
trading, the Company closes its trading window fordesignated employees
and directors from time to time. As per the policy, the trading window
closes for a period of 7 (seven) days, priorto the date of the Board
Meeting and opens 24 hours afterthe conclusion of Board Meeting in
which the respective quarterly/half yearly/yearly financial results are
approved. The trading window is also closed during and after occurrence
of price sensitive events as per the Code of Conduct for prevention of
insider trading.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and
Senior Management personnel. The code of conduct has also been posted
on the official website of the Company. A copy of the code of conduct
has been circulated to all the directors and Senior Management.
The Declaration by the Managing Director of the Company regarding
compliance with the Code of Conduct for Board Members and Senior
Management is annexed with the Corporate Governance report.
Secretarial Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out
the Secretarial Audit on quarterly basis to reconcile the total issued
and listed share capital with National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL). The
Board of Directors confirms that the total issued and paid up capital
as on 31st March, 2012 is reconciled with the total number of shares in
physical form and the total number of dematerialized shares held with
NSDL and CDSL. The Secretarial audit report is being submitted every
quarterto the Stock Exchanges and is also placed before the Board
Meeting.
Cost Compliance Certificate
As per notification no. GS.R. 429(E) dated 3rd June, 2011, Ministry of
Corporate Affairs, has mandated forthe Cost Compliance Certificates to
be compulsorily obtained from Cost Accountants by the certain
Companies. The Company being eligible as per the criteria mentioned in
the said notification obtained a Cost Compliance Certificate for the
year 2011-12 from M/s Kabra & Associates, Cost Accountants which was
duly approved in the Board Meeting held on 26th May, 2012.
Subsidiary Company
The Company had no subsidiary during the financial year 2011-12.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the
equity shares of your Company are presently listed on the premier stock
exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock
Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing
Agreement, the annual listing fees for the year 2012-2013 has been paid
within the prescribed time period. It is further confirmed that
custodian fee to NSDL/CDSL forthe year 2012-13 has also been paid.
Dematerialization of the equity shares
98.88 % of the total equity shares of the Company are held in
dematerialized form with the participants of National Securities
Depository Limited (NSDL) and Central Depository Securities (India)
Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge
the shareholders holding shares in physical form to get their shares
dematerialized.
Directors
Recently the Board of Directors of your company has been reconstituted
with the induction of two new Additional Directors, Mr. Krishna Chandra
Verma w.e.f November 12, 2011 and Mr. Prasad Dasgupta w.e.f February
14, 2012. The appointment of Mr. Krishna Chandra Verma and Mr. Prasad
Dasgupta are up to the forthcoming Annual General Meeting your Board
commends to the shareholders, their appointment as a Director of the
Company.
Mr. Vinit Taneja and Mr. P.C. Mathew, Directors of the Company, retire
by rotation at the ensuing Annual General Meeting and being eligible
offer themselves for re- appointment. Mr. Deep Kapuria, Mr. Pranav
Kapuria, Mr. Sandeep Dinodia, Mr. Anil Kumar Khanna, and Mr. Anuj
Kapuria, Mr. Ramesh Chandra Jain are the other continuing Directors
A brief profile of the directors proposed to be appointed or
re-appointed and the information pursuant to Clause 49 VI (A) of the
Listing Agreement is being annexed to the Notice convening the 26th
Annual General Meeting.
Auditors
M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of
the Company retire at the conclusion of the Annual General Meeting of
the Company and being eligible, have offered themselves for
re-appointment. The Company has received an eligibility certificate
from the auditors under Section 224 (1B) of the Companies Act, 1956.
The Board of Directors recommends their re- appointment.
With respect to the point no. ix (b) in annexure to the Auditors'
Report with regard to non deposit of disputed taxes, the Board to
inform that company has preferred appeal to Assessing Authorities. The
rest of report by the Statutory Auditors is self explanatory. Please
refer to the Notes to Accounts wherever necessary.
Directors Responsibility Statement
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Board of Directors
of your Company confirms:
a. That the applicable accounting standards have been followed in the
preparation of final accounts for the year ended March 31,2012 and that
there are no material departures.
b. That such accounting policies have been selected and applied
consistently and such judgments and estimates made are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2012 and of the profit of the Company for
the year ended on that date.
c. That proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and
preventing and detecting fraud and other irregularities, and
d. That the annual accounts for the year ended March 31, 2012 have
been prepared on a going concern basis.
Audit Committee
Company has duly constituted Audit Committee, which meets on regular
intervals forthe business required to be transacted thereat. The
recommendation made by such committee are accepted by the Board.
Particulars of Employees
Information in accordance with the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975 as amended, is given inAnnexure-l, to this report.
The Conservation of Energy, Technology Absorption, Foreign Exchange
earnings and outgo.
Your Company continuously strives for Safety, Environment Management
and conservation of resources like fuel, water, gas and power.
Therefore, emphasis is being laid on employing sophisticated techniques
which result in conservation of natural resources like energy, fuel
etc.
Your company gives high priority to safety which envisages a zero
accident policy as the only acceptable standard of performance.
Details of Energy Conservation, Technology Absorption, Research &
Development activities undertaken by the Company and foreign exchange
earnings and outgo of the Company and other information in accordance
with the provisions of Section 217(1) (e) ofthe Companies Act, 1956,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors), Rules, 1988, are given in Annexure-ll, to this
Report.
Corporate Governance
The Report on Corporate Governance is attached herewith in
Annexure-lll, and the certificate from the Statutory Auditors
confirming compliance with the provisions of Corporate Governance as
stipulated in Clause 49 ofthe listing agreement is also attached to the
report.
Management discussion & analysis report
The Management Discussion & Analysis Report is given separately,
forming part of this report.
Trade Relations
The Board of Directors place on record their appreciation forthe
co-operation and valuable support extended by the customers, the
suppliers and all other persons directly or indirectly associated with
the Company. Your Company regards them as partners and shares with them
a common vision of growth in the future.
Public Deposits
During the year under review your Company neither invited nor accepted
any deposit within the meaning of Section 58-A ofthe Companies Act,
1956, and rules made there under.
Personnel
The Board of Directors place on record their appreciation of the
untiring efforts of the employees of the organisation at every level.
The efforts to create a family like atmosphere continued throughout the
year. Like the many years gone-by, this year also witnessed increased
cohesion among all levels of employees, which is evident from the
performance of the Company. Training and Development of employees
provided further impetus and have contributed towards the all round
improved performance of your company. The Company encourages by
rewarding & recognising employees fortheir long term commitment as &
when the opportunity arise.
Awards and Other Recognitions
Yourdirectors have pleasure and feel privileged in reporting the awards
& recognitions received by the Company for the year 2011-2012.The
Details are provided in the Management Discussion &Analysis Report.
Acknowledgement
Yourdirectors place on record their sincere appreciation for the
assistance, cooperation and valuable support provided to the Company by
Customers, Vendors, Banks & Financial Institutions and hope to continue
to receive the same in future. Your Directors also record their
appreciation for the commitment and dedication of the employees of the
Company at all levels.
The Board of Directors also place on record theirgratitude to the
shareholders of the Company for their continued support to and
confidence in the management of the Company.
By Order of the Board
For Hi - Tech Gears Limited
Place: New Delhi Deep Kapuria
Dated: 8th August, 2012 Chairman
Mar 31, 2011
Dear Members,
The Directors present the 25th Annual Report of your Company with
great pleasure, together with the audited statement of accounts for the
financial year ended 31st March, 2011.
Financial Results
The highlights of the financial performance of the Company are as
under:-
(Rs. in lacs)
Particulars 2010-2011 2009-2010
Sales (net of excise duty) 42493.15 32269.86
Other Income 243.23 86.18
Total Income 42736.38 32356.05
Profits before Depreciation, Interest
and Taxes (PBDIT) 7647.39 4846.94
Depreciation 1618.71 1260.72
Profits before Interest and Taxes ( PBIT) 6028.68 3586.22
Financial Charges 761.52 887.07
Cash Profit (PBDT) 6885.86 3959.86
Profits before Taxes (PBT) 5267.16 2699.14
Provision for Taxes 1762.97 914.09
Profit after tax (PAT) 3504.19 1785.05
Balance of profit brought forward 3276.53 2238.07
Balance available for appropriation 6780.00 4020.57
Dividend 750.72 422.28
Tax on dividend 122.87 71.76
Transfer to General Reserve 400.00 200.00
Balance Surplus in P & L Account 5456.41 3276.53
Paid-up Equity Share Capital 1876.80 938.40
Earnings Per Share (EPS) 18.67 19.00
Operations
The year gone by proved to be a turnaround year for the performance of
your company and very encouraging for exports. The revenues of the
Company (net of excise duty) increased to Rs. 42736.38 lacs in 2010-11
as compared to Rs.32356.05 lacs in 2009-10, thus registering an
impressive increase of 32.08%. The Net Profit (after tax) of the
Company has increased from Rs. 1785.04 lacs to Rs. 3504.19 lacs,
recording an increase of 96.31 % as compared to the previous year.
During the year your company allotted bonus shares to the existing
shareholders of the Company in the proportion of 1:1 by capitalising
Rs.938.40 lacs from the General Reserves, thus raising the paid up
share capital of your company to Rs.1876.80 lacs. The earnings per
share (EPS) was Rs.18.67 per equity share on the increased share
capital for the year under review. In the prior year ( 2009-10 ) it
was Rs.19.00 per share on the lower share capital of Rs. 938.40 Lacs.
The year under review saw an increase in demand for the company's
products in both the domestic and exports markets.
Exports
During the year under review your Company recorded a total export
turnover of Rs. 90.03 crores as compared to export sales of Rs. 48.89
crores in the previous year, thus registering an increase of 84% . The
higher exports were made possible because your company penetrated the
European and Latin American markets also in addition to US market.
Dividend
During the year, an interim dividend of 15% i.e. Rs. 1.50 per equity
share on the increased share capital amounting to Rs. 281.52 lacs was
declared and paid. The Directors have now recommend to the
shareholders a final dividend of 25% i.e. Rs. 2.50 per equity share
subject to the approval of the shareholders at the ensuing Annual
General Meeting resulting in a payout of Rs. 469.20 lacs.
If the dividend on the shares as, recommended by the Board of
Directors, is approved by the shareholders in their 25th Annual General
Meeting, payment of such dividend will be made to those members whose
names appear in the Register of Members as on September 27, 2011. In
respect of the shares held in electronic form, the dividend will be
payable to the beneficial owners of the shares as on the closing hours
of business on September 15, 2011, as per the details furnished by the
depositories for this purpose.
Credit Rating
The independent credit rating agency, 'Fitch' has upgraded HGL's rating
to 'A (ind)', which reflects HGL's consistent revenue growth and an
improvement in its profitability in the last four years supported by a
decline in HGL's working capital cycle. Your company's net cash
conversion cycle therefore improved from 19 days to 3 days.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India
(SEBI), companies should mandatorily use the facility of Electronic
Clearing Services (ECS), for distribution of dividends to its members.
This facility provides to the members an opportunity to receive
dividend amount directly in their bank accounts. For availing this
facility, members holding shares in physical form may send their duly
filled ECS mandate form to the Company's Registrar and Share Transfer
Agent (RTA). Members holding shares in dematerialized form may kindly
note that their bank account details as furnished to their depositories
will be taken for the purpose of ECS and the Company. Shareholders who
wish to change their bank account details are therefore requested to
advise their depositories participants about such changes.
Those shareholders who have not yet opted for the ECS facility are once
again requested to avail the benefits of ECS.
Postal Ballot
During the financial year 2010-11, no Special Resolution was required
to be passed through postal ballot. At the forthcoming Annual General
Meeting, there is no item for approval through Postal Ballot.
Code for Prevention of Insider Trading Practices
In compliance with the SEBI (Prohibition of Insider Trading)
Regulations, 1992, your Company has adopted a Code of Conduct for
Prevention of Insider Trading Practices for its Directors and
designated employees. The code lays down guidelines, which include
procedures to be followed, and disclosures to be made while dealing in
the shares of the Company.
Trading Window
In accordance with the Code of Conduct for prevention of insider
trading, the Company closes its trading window for designated employees
and directors from time to time. As per the policy, the trading window
closes for a period of 7 (seven) days, prior to the date of the Board
Meeting and opens 24 hours after the conclusion of Board Meeting in
which the respective quarterly/half yearly/ yearly financial results
are approved. The trading window is also closed during and after
occurrence of price sensitive events as per the Code of Conduct for
prevention of insider trading.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and
Senior Management personnel. The code of conduct has also been posted
on the official website of the Company. A copy of the code of conduct
has been circulated to all the directors and Senior Management.
The Declaration by the Managing Director of the Company regarding
compliance with the Code of Conduct for Board Members and Senior
Management is annexed with the Corporate Governance report.
Secretarial Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out
the Secretarial Audit on quarterly basis to reconcile the total issued
and listed share capital with National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL). The
Board of Directors confirms that the total issued and paid up capital
as on 31st March, 2011 is reconciled with the total number of shares in
physical form and the total number of dematerialized shares held with
NSDL and CDSL. The Secretarial audit report is being submitted every
quarter to the Stock Exchanges and is also placed before the Board
Meeting.
Subsidiary Company
The Company had no subsidiary during the financial year 2010-11.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the
equity shares of your Company are presently listed on the premier stock
exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock
Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing
Agreement, the annual listing fees for the year 2011-2012 has been paid
within the prescribed time period.
Dematerialization of the equity shares
98.59% of the total equity shares of the Company are held in
dematerialized form with the participants of National Securities
Depository Limited (NSDL) and Central Depository Securities (India)
Limited as on the date of this report.
Keeping in view the benefits of dematerialization, your directors urge
the shareholders holding shares in physical form to get their shares
dematerialized.
Directors
Recently, the Board of Directors of your company has been reconstituted
with the induction of a new Additional Director, Mr. Ramesh Chandra
Jain w.e.f August 10, 2011. The appointment of Mr. Jain is upto the
forthcoming Annual General Meeting and the Board of Directors commends
to the shareholders, his appointment as a Director of the Company.
Mr. Anil Kumar Khanna and Mr. Pranav Kapuria, Directors of the Company,
retire by rotation at the ensuing Annual General Meeting and being
eligible offer themselves for re-appointment. Mr. Deep Kapuria, Mr.
Sandeep Dinodia, Mr. Anil Kumar Khanna, Mr. P C Mathews and Mr. Anuj
Kapuria are the other continuing Directors
A brief profile of the directors proposed to be appointed or
re-appointed and the information pursuant to Clause 49 VI (A) of the
Listing Agreement is being annexed to the Notice convening the 25th
Annual General Meeting.
Auditors
M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of
the Company retire at the conclusion of the Annual General Meeting of
the Company and being eligible, have offered themselves for
re-appointment. The Company has received an eligibility certificate
from the auditors under Section 224 (1B) of the Companies Act, 1956.
The Board of Directors recommends their re-appointment.
The report by the Statutory Auditors is self explanatory. Please refer
to the Notes to Accounts wherever necessary.
Directors Responsibility Statement
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Board of Directors
of your Company confirms:
a. That the applicable accounting standards have been followed in the
preparation of final accounts for the year ended March 31, 2011 and
that there are no material departures.
b. That such accounting policies have been selected and applied
consistently and such judgments and estimates made are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2011 and of the profit of the Company for
the year ended on that date.
c. That proper and sufficient care has been taken for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and
preventing and detecting fraud and other irregularities, and
d. That the annual accounts for the year ended March 31, 2011 have been
prepared on a going concern basis.
Particulars of Employees
Information in accordance with the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975 as amended, is given in Annexure-I, to this report.
The Conservation of Energy, Technology Absorption, Foreign Exchange
earnings and outgo.
Your Company continuously strives for Safety, Environment Management
and conservation of resources like fuel, water, gas and power.
Therefore, emphasis is being laid on employing sophisticated techniques
which result in conservation of natural resources like energy, fuel
etc.
Your company gives high priority to safety which envisages a zero
accident policy as the only acceptable standard of performance.
Details of Energy Conservation, Technology Absorption, Research &
Development activities undertaken by the Company and foreign exchange
earnings and outgo of the Company and other information in accordance
with the provisions of Section 217(1) (e) of the Companies Act, 1956,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors), Rules, 1988, are given in Annexure-II, to this
Report.
Corporate Governance
The Report on Corporate Governance is attached herewith in
Annexure-III, and the certificate from the Statutory Auditors
confirming compliance with the provisions of Corporate Governance as
stipulated in Clause 49 of the listing agreement is also attached to
the report.
Management discussion & analysis report
The Management Discussion & Analysis Report is given
separately, forming part of this report.
Trade Relations
The Board of Directors place on record their appreciation for the
co-operation and valuable support extended by the customers, the
suppliers and all other persons directly or indirectly associated with
the Company. Your Company regards them as partners and shares with them
a common vision of growth in the future.
Public Deposits
During the year under review your Company neither invited nor accepted
any deposit within the meaning of Section 58-A of the Companies Act,
1956, and rules made there under.
Personnel
The Board of Directors place on record their appreciation of the
untiring efforts of the employees of the organisation at every level.
The efforts to create a family like atmosphere continued through out
the year. Like the many years gone-by, this year also witnessed
increased cohesion among all levels of employees, which is evident from
the performance of the Company. Training and Development of employees
provided further impetus and have contributed towards the all round
improved performance of your company.
Awards and Other Recognitions
Your directors have pleasure and feel privileged in reporting the award
received by the Company during 2010-2011.The Details are provided in
the Management Discussion & Analysis Report.
Acknowledgement
Your directors place on record their grateful appreciation for the
assistance, cooperation and valuable support provided to the Company by
Customers, Vendors, Banks & Financial Institutions and hope to continue
to receive the same in future. Your Directors also record their
appreciation for the commitment and dedication of the the employees of
the Company.
The Board of Directors also place on record their gratitude to the
shareholders of the Company for their continued support to and
confidence in the management of the Company.
By Order of the Board
For Hi-Tech Gears Limited
Place: New Delhi Deep Kapuria
Dated: August 10, 2011 Chairman
Mar 31, 2010
With great pleasure your directors presents their 24th Annual Report of
your Company together with the audited statement of accounts for the
financial year ended on March 31,2010.
Financial Results
The highlights of the financial performance of the Company are as
under:-
(Rs. in lacs)
Particulars 2009-2010 2008-09
Gross Sales 34456.55 32,378.14
Other Income 86.18 129.85
Total Income 34542.73 32507.99
Profits before Depreciation, 4846.94 3324.81
Interest and Taxes (PBDIT)
Depreciation 1260.72 1176.51
Profits before Interest and 3586.22 2148.30
Taxes (PBIT)
Financial Charges 887.07 996.77
Cash Profit (PBDT) 3963.34 2364.42
Profits before Taxes (PBT) 2699.14 1187.91
Provision for Taxes 913.01 359.32
Profit after tax (PAT) 1785.05 769.36
Balance of profit brought 2238.07 2018.43
forward
Dividend 422.28 140.76
Tax on dividend 71.76 23.92
Transfer to General Reserve 200.00 200.00
Balance Surplus in 3276.53 2238.07
P&L Account
Earnings Per Share (EPS) 19.00 6.23
Operations
The financial year 2009-2010 has ended on a positive note. Your Company
surpassed the previous year turnover and has achieved a gross turnover
of Rs. 34456.55 Lac (Previous year 32,378.14 Lac), recording an
increase of 6.41%. The Net Profit (After tax) of the Company has
increased from Rs. 769.36 Lac to Rs. 1785.04 Lac, recording an
increase of 132.02 % as compared to the previous year.
The year under review saw increase in demand of the two wheelers and
exports also picked up specially in the last two months of the
financial year. The availability of the credit and improvement in the
world economy has resulted in rise in the demand of the automobiles
world wide.
Exports
During the year under review your Company has shown export of its
components, recording a total export turnover of Rs. 4889.20 Lac as
compared to Rs. 4881.69 Lac in the previous year.
Dividend
The directors recommend to the shareholders a dividend @ 45% (i.e. Rs.
4.5/- per equity share) for the year 2009-2010. Previous year your
Company paid dividend @ 15% (i.e. Rs.1.50/- per equity share).
If the dividend on shares as, recommended by the Board of Directors, is
approved by the shareholders in their 24th Annual General Meeting,
payment of such dividend will be made to those members whose names
appear in the Register of Members as on September 27, 2010 and in
respect of the shares held in electronic form, the dividend will be
payable to the beneficial owners of the shares as on the closing hours
of business on September 16,2010, as per the details furnished by the
depositories j for this purpose.
Electronic Clearing Services (ECS)
As per the circular issued by Securities & Exchange Board of India
(SEBI), the companies should mandatorily use the facility of Electronic
Clearing Services (ECS), for distribution of dividends to its members.
This facility provides to the members an option to receive dividend
amount directly in their bank accounts. For availing this facility,
members holding shares in physical form may send their duly filled ECS
mandate form to the Companys Registrar and Share Transfer Agent (RTA).
Members holding shares in dematerialized form may send their ECS
mandate to the concerned Depository Participants (DP) in the prescribed
form.
Those shareholders who have not yet opted for the ECS facility are once
again requested to avail the benefits of ECS.
Postal Ballot
During the financial year 2009-10, no Special Resolution was required
to be passed through postal ballot. At the forthcoming Annual General
Meeting, there is no item for approval through Postal Ballot.
Code for Prevention of Insider Trading Practices
In compliance with the SEBI (Prohibition of Insider Trading)
Regulations, 1992, your Company has adopted a Code of Conduct for
Prevention of Insider Trading Practices for its Directors and
designated employees. The code lays down guidelines, which include
proce- dures to be followed, and disclosures to be made while dealing
in the shares of the Company.
Trading Window
In accordance with the Code of Conduct for prevention of insider
trading, the Company closes its trading window for designated employees
and directors from time to time. As per policy, trading window closes
for a period of 7 (seven) days, prior to the date of Board Meeting and
reopens after passing of 24 hours from the conclusion of Board Meeting
in which the respective quarterly/half yearly/ yearly financial results
are approved. The trading window is also closed during and after
occurrence price sensitive event as per the Code of Conduct for
prevention of insider trading.
Code of Conduct
Your Company has adopted a Code of Conduct for its Board Members and
Senior Management personnel. The code of conduct has also been posted
on the official website of the Company. A copy of the code of conduct
has been circulated to all the directors and senior Management.
The Declaration by the Chairman & Managing Director of the Company
regarding compliance with the Code of Conduct for Board Members and
Senior Management is annexed with the Corporate Governance report.
Secretarial Audit
M/s Grover Ahuja & Associates, practicing Company Secretary carried out
Secretarial Audit on quarterly
basis to reconcile the total issued and listed share capital with
National Securities Depository Limited (NSDL) and Central Depository
Services (India) Limited (CDSL). The Board of Directors confirms that
the total issued and paid up capital as on 31st March, 2010 is
reconciled with the total number of shares in physical form and the
total number of dematerialized shares held with NSDL and CDSL. The
Secretarial audit report is being submitted every quarter to the Stock
Exchanges and is also placed before the Board Meeting.
Subsidiary Company
The Company had no subsidiary during the financial year 2009-10.
Listing of Shares
With a view to provide easy liquidity in the shares of the Company, the
equity shares of your Company are presently listed on the premier stock
exchanges viz., the National Stock Exchange (NSE) and the Bombay Stock
Exchange Limited (BSE) Mumbai. Pursuant to Clause 38 of the Listing
Agreement, the annual listing fees for the year 2010-2011 has been paid
within the prescribed time period.
Dematerialization of the equity shares
98.47% of the total equity shares of the Company are held in
dematerialized form with the participants of National Securities
Depository Limited (NSDL) and Central Depository Securities (India)
Limited as on March 31,2010.
Keeping in view the benefits of dematerialization, your directors urge
the shareholders holding shares in physi- cal form to get their shares
dematerialized.
Directors
Mr. Sandeep Dinodia and Mr. Anuj Kapuria, Directors of the Company,
retire by rotation at the ensuing Annual æGeneral Meeting and being
eligible offer themselves for F re-appointment. Your Board of Directors
considers that it would be in the interest of the Company to continue
to avail the services of the above Director due to their vast
knowledge, experience and ability.
Mr. Deep Kapuria was appointed as Chairman & Managing Director of the
Company for a period of 5 (five) years w.e.f. 1st January 2007 to 31st
December 2011, for which approval was duly accorded by the members in
their 21st Annual General Meeting held on 17th September, 2007. Keeping
in View the restructuring of the designation among all the working
Directors of the Company, your Board of Directors has recom- mended for
the change in the present designation of Mr. Deep Kapuria from Chairman
& Managing Director to Chairman & Whole Time Director (designated as
Executive Chairman) w.e.f. 05th August 2010 to 31st December 2011, in
their meeting held on 24 day of July 2010, Subject to the approval of
shareholders in the ensuing Annual General Meeting.
On the recommendation on Remuneration Committee, Mr. Pranav Kapuria,
Deputy Managing Director of the company has been reappointed by the
Board of Direc- tors for a period of five years w.e.f. 1st August 2010
to 31st July 2015 in their meeting held on 15th May 2010 subject to the
approval of the shareholders. The Board of Directors has also made
change in his designation from Deputy Managing Director to Managing
Director from 5th August 2010 till 31st July, 2015, subject to the
approval of Shareholders. Further the Board of Direc- tors has also
appointed Mr. Anuj Kapuria as Whole Time Director designated as
Executive Director w.e.f. 15th May 2010 to 14th May 2015, subject to
the approval of share- holders.
Resolutions for the said appointment/reappointment- /restructuring are
being included in the notice for the ensuing Annual General Meeting for
the approval of shareholders.
Directors Responsibility Statement
In compliance of Section 217(2AA) of the Companies Act, 1956, as
amended by the Companies (Amendment) Act, 2000, the Board of Directors
of your Company confirms:
(i) That the applicable accounting standards have been followed in the
preparation of final accounts for the year ended March 31, 2010 and
that there are no mate- rial departures.
(ii) That such accounting policies have been selected and applied
consistently and such judgments and estimates made are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as at March 31, 2010 and of the profit of the Company for
the year ended on that date.
(iii) That proper and sufficient care has been taken for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956, for safeguarding the assets of
the Company and preventing and detecting fraud and other
irregularities, and
(iv) That the annual accounts for the year ended March 31, 2010 have
been prepared on a going concern basis.
Particulars of the Employees
Information in accordance with the provisions of Section 217(2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employees)
Rules, 1975 as amended, is given in Annexure-I, to this report.
The Conservation of Energy, Technology Absorp- tion, Foreign Exchange
earnings and outgo.
Details of Energy Conservation, Technology Absorp- tion, Research &
Development activities undertaken by the Company and foreign exchange
earnings and outgo of the Company and other information in accord- ance
with the provisions of Section 217(1) (e) of the Companies Act, 1956,
read with the Companies (Disclosure of Particulars in the Report of
Board of Directors), Rules, 1988, are given in Annexure-ll, to this
Report.
Your Company continuously strives for Safety, Environ- ment Management
and conservation of resources like fuel, water, gas and power. Your
company believes in vision of safety which envisages zero accident
policy as the only acceptable standard of performance. There- fore,
emphasis is being laid on employing sophisticated techniques which
result in conservation of natural resources like energy, fuel etc.
Corporate Governance
Report on Corporate Governance is attached herewithin Annexure-lll,
and the certificate from the Statutory Auditors confirming the
compliance of the provisions of Corporate Governance as
stipulated in Clause 49 of the listing agreement with the stock
exchanges is given in this report.
Management Discussion & Analysis Report
Management Discussion & Analysis Report is given separately, forming
part of this report.
Trade Relations
The Board of Directors place on record their apprecia- tion for the
co-operation and valuable support extended by the customers, the
suppliers and all other I persons directly or indirectly associated
with the Company. Your Company regards them as partners and shares with
them vision of growth in the future.
Public Deposits
During the year under review your Company neither invited nor accepted
any deposit within the meaning of Section 58-A of the Companies Act,
1956, and rules made there under.
Personnel
The Board of Directors place on record its appreciation for the
untiring efforts made by the employees of the organisation at every
level. The efforts to create a family like atmosphere continued through
out the year. Like many years gone-by this year also witnessed
increased cohesion among all levels of employees, which is evident from
the performance of the Company. Train- ing and Development of employees
provided further impetus and have been largely responsible for the all
round improved performance.
Awards and Other Recognitions
Your directors have pleasure and feel privileged in reporting the award
received by the Company during 2009-2010The Details were given in
Annexure-IV.
Auditors
M/s Gupta Vigg & Company, Chartered Accountants, Statutory Auditors of
the Company retire at the conclu- sion of the Annual General Meeting of
the Company and being eligible, have offered themselves for
re-appointment. The Company has received an eligibil- ity certificate
from the auditors under Section 224 (IB) of the Companies Act, 1956.
The Board of Directors recommends their re-appointment.
Acknowledgement
Your directors place on record their grateful apprecia- tion for the
assistance, cooperation and support provided to the Company by Vendors,
Customers, Banks & Financial Institutions like Hero Honda Motors
Limited, Honda Motorcycle and Scooter Ltd., Honda Siel Cars Ltd., Honda
Siel Power Products Ltd.,Tata Cummins Ltd., GETRAG Corporation, GETRAG
All Wheel Drive, Robert Bosch, State Bank of India, ICICI Bank Limited,
Citi Bank, Standard Chartered Bank, State Bank of Bikaner and Jaipur,
Bank of Baroda, DBS Bank, YES Bank for their valued support, and hope
to continue to receive the same in future.
The Board of Directors also place on record their gratitude to the
shareholders of the Company for their continued support to and
confidence in the manage- ment of the Company.
By Order of the Board of
Hi -Tech Gears Limited
Deep Kapuria
Chairman & Managing Director
Place : New Delhi
Dated : July 24, 2010