Dear Shareholders,
Your Directors take pleasure in presenting the 29th Annual Report on the business and
operations of the Company, together with the audited financial statements for the
Financial Year ended 31st March, 2021.
STATE OF COMPANYS AFFAIRS:
FINANCIAL HIGHLIGHTS |
Rs. in Lakhs |
|
Particulars |
2020-21 |
2019-20 |
Revenue from operations |
1,50,258.53 |
1,66,290.16 |
Other income |
5,633.71 |
6,369.32 |
Total Revenue |
1,55,892.24 |
1,72,659.48 |
Earnings Before Interest, Depreciation, Taxation & Amortisation (EBITDA) |
23,722.39 |
32,388.92 |
Finance Costs |
4,555.96 |
4,620.06 |
Depreciation |
4,624.24 |
4,116.71 |
Profit/(Loss) Before Taxation |
14,542.19 |
23,652.15 |
Less: Tax including Deferred Tax |
4,176.96 |
4,884.53 |
Profit/(Loss) After Taxation |
10,365.23 |
18,767.62 |
DIVIDEND:
Your directors recommend payment of dividend of Rs.6/- (60%) per equity share of
Rs.10/- each for the financial year ended 31st March, 2021 (previous year Rs.7.00 per
share) amounting to Rs.2801.90 lakhs. The dividend payout is subject to approval of the
members at the ensuing Annual General Meeting.
RESERVES:
During the year under review, the Company proposes to transfer Rs.5,000 lakhs to the
General Reserve.
SHARE CAPITAL
The paid up equity share capital of your Company as on 31 March 2021 was Rs.46.70
Crores. There was no fresh issue of capital during the year under review. The Company has
neither issued shares with differential voting rights, sweat equity shares, nor has it
granted any stock options.
REVIEW OF OPERATIONS:
During the FY 2020-21, your Company has produced 2,37,156 MT of Ductile Iron Pipes,
which is lower by 56,335 MT compared to the FY 2019-20. The Company has lost production
during entire April20 due to shutdown of the plant following nationwide lockdown
imposed by the Central Government to contain the spread of Covid19 pandemic. Though,
production has started in a phased manner from 1st week of May, 2020, due to absenteeism
consequent to the nationwide lockdown, plant could not be operated at full capacity till
August, 2020, which has resulted in lower production during the year under review compared
to FY 2019-20. Your directors are pleased to inform that your Company has come out of the
clutches of the Pandemic, restoring normalcy from September, 2020 and the plant has been
operating at full capacity.
Your Company continues to play a constructive role in the nation building movement by
contributing to water supply and infrastructure development in the country, which are the
thrust areas of the Government. During the FY 2020-21, your Companys Ductile Iron
Pipes of about 6,500 KM have been used for transportation of potable water and sewerage
under its brand name "SRIPIPES" for various prestigious water projects across
the country, thus increasing its market share further.
Production at a glance:
Product |
2020-21 |
2019-20 |
% of Change |
|
Prod. |
Sales * |
Prod. |
Sales * |
Prod. |
Sales |
Ductile Iron Pipes (MT) |
2,37,156 |
2,46,973 |
2,93,491 |
2,85,848 |
-19.19 |
-13.60 |
Liquid metal from MBF (MT) |
2,58,978 |
2,59,925 |
2,99,477 |
2,98,326 |
-13.52 |
-12.87 |
LAM Coke (MT) |
1,68,499 |
1,78,375 |
1,67,240 |
1,75,101 |
0.75 |
1.87 |
Cement (MT) |
81,788 |
82,554 |
60,654 |
60,719 |
34.84 |
35.96 |
During the year under review, your Company has reported
ProfitBefore Tax (PBT) of Rs. 145.42 Crores, which is lower by 38.52% compared to FY
2019-20. The decline in the profitability of your Company is largely attributable to
reduced production on account of Covid-19 pandemic. Your Company has registered a
reduction of about 19.25% in revenue from Ductile Iron Pipes at Rs.1,127.15 Crores as
compared to Rs.1,395.60 Crores achieved during the FY 2019-20. The EBITDA of the Company
was also lower at Rs.237.22 Crores and the Profit After Tax (PAT) being Rs.103.65 Crores
compared to Rs. 323.89 Crores and Rs.187.67 Crores, respectively, achieved during the FY
2019-20.
FUTURE PROSPECTS:
Although Covid-19 pandemic has impacted the execution of Phase I of expansion plans
envisaged during the FY 2019-20 to install new MBF, additional Hot Blast Stoves, Raw
material handling system, though delayed, has reached to the stage of completion of the
said project. However, due to 2nd wave of the pandemic, the proposed capital shutdown for
the commissioning of new blast furnace may get slightly delayed for mobilization of
resources required for the shutdown. Post commissioning, the capacity of mini blast
furnace will be increased from 3,00,000 TPA to 5,00,000 TPA. Further, in connection with
augmenting the production capacity of DI Pipes to 4,00,000 TPA in line with blast furnace
production capacity, facilities like additional Annealing Furnace, new induction furnace
in place of existing induction furnace 3, relocation of rework bay and 1200 dia production
facilities have been completed and other facilities like zinc coating machine for
finishing line 3, new induction furnace in place of existing induction furnace 2,
upgradation of converter will be taken up during the capital shutdown for commissioning of
new blast furnace. Upon completion of these facilities, the capacity of DI Pipe Plant will
also be increased to 4,00,000 TPA. The Company is having comfortable order book for supply
of Ductile Iron pipes. During this Covid-19 situation, safe and hygienic water supply is
most important for the Government. Ductile Iron pipe is the safest and most suitable pipe
for transportation of water not only in urban cities but also in rural India. The Company
is hopeful that Central and State Governments will continue to give priority and remain
committed in respect of ongoing and future water supply, sewerage and irrigation and other
projects in the country. With enhanced production capacity, the company should be able to
serve more customers and will command more market share.
AMALGAMATION WITH ELECTROSTEEL CASTINGS LIMITED:
The Company and Electrosteel Castings Limited are under the control of common promoter
group and both the Companies are engaged in the same line of business, i.e., manufacture
and sale of ductile iron pipes and both have common economic objective and strategic
goals. Considering various advantages of amalgamation, viz., operational synergies,
greater efficiency and economical operations for future growth of the combined entities,
efficient utilization of capital, superior deployment of brand promotion, sales strategies
and creation of a consolidated and diversified base for future growth with a wider
presence in the Ductile Iron Pipe segment, prevention of cost duplication, administrative
and operational rationalization and promote organizational efficiencies, the Board of
Directors of the Company, at its meeting held on 5th October, 2020, had approved the
proposal and the Scheme of amalgamation of the Company with Electrosteel Castings Limited.
Subsequently, the Scheme application was filed by the Company under Regulation 37 of
Listing Regulations, 2015 with both National Stock Exchange of India Limited and BSE
Limited and the same have been reviewed by the exchanges and the observation letters were
forwarded to SEBI by both the exchanges. SEBI having scrutinized the Scheme application
had accorded its approval for the proposed Scheme of Amalgamation. Both the exchanges have
issued their respective Observation/No-Objection Letters, dated 25 February, 2020, for the
aforesaid proposed Scheme of amalgamation. Further, the Company has received the approval
of Competition Commission of India for the proposed Scheme.
Upon receiving the aforesaid Observation/No-Objection
Letters, the Company had filed its application with National
Company Law Tribunal (NCLT), Amaravathi Bench at Hyderabad, where the
initial hearing was held on 19th March, 2021. NCLT, Amaravati Bench, vide order dated 30
April, 2021, has directed that the meetings of shareholders and creditors be held on 16
June, 2021 for, inter alia, approving the Scheme. In view of the various circulars issued
by Ministry of Corporate Affairs and taking into consideration the prevailing Covid-19
pandemic situation, the Company is in the process of holding the said meetings through
Video Conference/Other Audio Visual Means.
Application filed by Electrosteel Castings Limited before the NCLT, Cuttack Bench, is
pending for hearing and order.
CREDIT RATING:
India Ratings & Research has assigned its rating for the Companys long term
borrowing programmes and fund based working capital facilities with IND AA-/RWN and rating
IND A1+/RWN for the Companys non-fund based working capital facilities and
Commercial Paper. The Company has withdrawn the ratings assigned by CARE Ratings Limited
(CARE) for the long-term bank facilities as "CARE A+; Stable" and
for short-term bank facilities as "CARE A1+".
CHANGES IN DIRECTORS/KEY MANAGERIAL PERSONNEL:
Resignation of Independent Directors:
During the year under review, Mr X.J.J. Abraham and Mrs S. Hemamalini, Independent
Directors, have resigned from their directorships with effect from close of working hours
of 9th and 10th September, 2020, respectively, due to health reasons and pre-occupation
with other commitments, respectively. Your Directors place on record their sincere
appreciation for the active participation and valuable contributions rendered to the
Company by them during their association with the Company.
Appointment of Independent Director:
Upon the recommendation of Nomination and Remuneration Committee, the Board has
approved the appointment of Dr Mohua Banerjee as an Additional Director (independent) of
the Company for a period of five years with effect from 16th November, 2020, subject to
the approval of the shareholders of the Company. Your Company has received a notice under
Section 160 of the Companies Act, 2013 from a shareholder of the Company, signifying his
intention to propose the name of Dr Mohua Banerjee, for appointment as an Independent
Director of your Company in the ensuing Annual General Meeting.
An affirmation had been received from Dr Banerjee that she is not debarred or
disqualified from being appointed as Director of companies/holding the office of director
pursuant to any order of the SEBI, Ministry of Corporate Affairs or any such statutory
authority. Brief profile Mohua Banerjee and requisite consents, disclosures and
declarations received from her have been given in the Notice of the ensuing Annual General
Meeting, for the perusal of the shareholders.
Re-appointment of director:
Mr Ashutosh Agarwal retires by rotation at the ensuing Annual General Meeting and being
eligible, has offered himself for re-appointment.
In compliance with Regulation 36(3) of the Listing Regulations and Secretarial
Standard-2 on General Meetings, brief resume and other information of all the Directors
proposed to be re-appointed are given in the Notice of the ensuing Annual General Meeting.
Appointment of Chief Executive Officer:
Upon the recommendation of Nomination and Remuneration Committee, the Board has
approved the appointment of Mr S.N. Goswami as Chief Executive Officer of the Company with
effect from 6th August, 2020.
There were no other changes in the Board and the Key Managerial Personnel during the
year under review.
Independent Directors:
The Company has received declarations from the Independent Directors confirming that
they meet with the criteria of independence as prescribed both under subsection (6) of
Section 149 of the Companies Act, 2013 and under SEBIs Listing Regulations, 2015, as
amended from time to time.
Further, in terms of Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014, as
amended, the Board of Directors state that in the opinion of the Board, Dr Mohua Banerjee,
who has been appointed as an Additional Director (Independent), is a person of integrity
and possesses relevant expertise and experience. Further, Dr Banerjee has successfully
qualified the online proficiency self-assessment test conducted by the Indian Institute of
Corporate Affairs.
The Board of Directors of your Company confirms that plans are in place for orderly
succession for appointment to the board of directors and senior Management and they are
reviewed every year.
CORPORATE GOVERNANCE:
Your Company ensures to evolve and follow the corporate governance guidelines and best
practices to enhance long term shareholder value. Your Company considers it an inherent
responsibility to disclose timely and accurate information regarding its operations as
well as governance of the Company.
A separate section on Corporate Governance and the certificate from the Practicing
Company Secretary confirmingcompliance of Corporate Governance norms as stipulated in
Regulation 34 read along with Schedule V of the SEBI Listing Regulations, forms part of
this Report at Annexure I.
INTERNAL FINANCIAL CONTROLS & ADEQUACY:
The Company has an adequate system of internal controls in place. It has documented
policies and procedures covering all financial and operating functions. These controls
have been designed to provide a reasonable assurance with regard to maintaining of proper
accounting controls for ensuring reliability of financial reporting and monitoring of
operations, and protecting assets from unauthorized use or losses, compliances with
regulations. The Company has continued its efforts to align all its processes and controls
with global best practices.
The controls, based on the prevailing business conditions and processes have been
tested during the year and no reportable material weakness in the design or effectiveness
was observed. The framework on Internal Financial Controls over Financial Reporting has
been reviewed by the Internal and Statutory auditors.
The Companys internal financial controls were operating effectively based on the
internal control criteria established by the Company considering the essential components
of internal control stated in the guidance note on audit of internal control over
financial reporting issued by the Institute of Chartered Accountants of India.
The Audit committee of the Board of Directors actively reviews the adequacy and
effectiveness of internal control systems and suggests improvements wherever needed to
strengthen the same.
MANAGEMENT DISCUSSION AND ANALYSIS:
In terms of the provisions of Regulation 34 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (SEBI LODR), discussion on state of Companys affairs
has been covered as part of the Management Discussion and Analysis (MDA) in a separate
section vide Annexure II to this Report.
RISK MANAGEMENT POLICY:
The Company has a well to identify and evaluate business risks, which protects and adds
value to the organization by minimizing adverse effect on the business of the Company. The
major risks identified by the functions are systematically addressed through mitigating
actions on a continuous basis. The risks are evaluated, quantified & prioritized and
mitigation plans are reviewed & monitored at various stages. The major risks connected
with the business, their likely bearing on the performance of the Company and their
mitigation are covered under Risks and Concerns Section of the Management Discussion and
Analysis, which forms part of this report.
NOMINATION & REMUNERATION POLICY:
The Board has adopted a Nomination and Remuneration Policy recommended by Nomination
and Remuneration Committee in terms of the provisions of Section 178 of the Act. The
Nomination and Remuneration Policy is available at the Companys website
http://www.srikalahasthipipes. com/static-files/pdf/policies/Nomination%20and%20
Remuneration%20Policy.pdf.
The Nomination and Remuneration Committee of the Company is in compliance with the
provisions of Section 178 of the Companies Act, 2013 read along with the applicable rules
thereto and Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and the terms of reference to the Committee include :-
To guide the Board in relation to appointment, retention and removal of
Directors, Key Managerial Personnel and Senior Management.
To evaluate the performance of the members of the Board and provide necessary
report to the Board for further evaluation of the Board.
To recommend to the Board on remuneration payable to the Directors and Key
Managerial Personnel.
Recommend to the Board a policy, relating to the remuneration for the Directors,
Key Managerial Personnel and other employees.
Devise a policy on Board diversity.
CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:
Your Company understands its social responsibility and remain focussed to support those
from the socially and economically backward groups and remain focussed to improve the
quality of life of the various communities.
In this process, your Company has identified several corporate social responsibility
initiatives relating to Social Empowerment & Welfare, Village development, Health
Care, Education and animal welfare during the year and initiated various activities in
neighbouring villages around plant locations.
The Board has adopted a Corporate Social Responsibility Policy (CSR Policy), in
accordance with Schedule VII of the Companies Act, 2013. The Annual Report on CSR
activities as required under Rule 8 of the Companies (Corporate Social Responsibility
Policy) Rules, 2014 read with section 134 (3) and 135 (2) of the Companies Act, 2013,
including the contents of the CSR Policy, composition of the Committee and other
particulars, is at Annexure III to this Report.
During the FY 2020-21, the Company has spent Rs.387.85 lakhs as against Rs.386.39 lakhs
which was required to be spent, towards various CSR activities viz. promotion of
education, village development, medical health and animal welfare, which are covered in
detail in the Report on CSR, which forms part of this report. Further, the unspent CSR
amount of Rs.5.04 lakhs relating to FY 2019-20, which was earmarked for the purpose of
animal welfare and protection, has been remitted by the Company in a separate
"Unspent Corporate Social Responsibility Account" and the entire amount has been
spent towards the intended project during the FY 2020-21.
Your Company continues to stay focussed on initiatives that would auger well for the
overall development of the communities and make a difference in the quality of living of
the underprivileged.
WHISTLE BLOWER MECHANISM (POLICY):
The Company has a vigil mechanism named Whistle Blower Policy / Vigil Mechanism
wherein, Employees/ Directors/Stakeholders of the Company are free to report any unethical
improper activity, actual or suspected fraud or violation of the Companys Code of
Conduct. The Policy provides for adequate safeguard against victimization of employees who
avail the mechanism and also provides direct access to the Chairman of the Audit
Committee. During the year under review, the Company has not received any complaints under
the said mechanism. The Whistle Blower Policy of the Company has been displayed on the
Companys website at http://www.srikalahasthipipes.com/
static-files/pdf/policies/Whistle%20Blower%20Policy.pdf
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE POLICY:
As per the requirement of The Sexual Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013 (Act) and Rules made there-under, your
Company has constituted Internal Complaints Committee (ICC). While maintaining the highest
governance norms, the Company has zero tolerance for sexual harassment at workplace.
During the year 2020-21, the Company has not received any complaint of sexual harassment.
BOARD EVALUATION:
The Board of Directors carry out an annual evaluation of its performance, and the
performance of its Committees as well as individual Directors. The performance of the
board was evaluated by the board after seeking inputs from all the directors on the basis
of criteria such as the board composition and structure, effectiveness of board processes,
information and functioning, etc.
The criteria for the performance evaluation of the Board of Directors includes aspects
such as its composition and structure, and the effectiveness of its processes, information
flowand functioning. The criteria for the performance evaluation of individual Directors
includes aspects, such as the Directors contribution to the Board of Directors and
Committee meetings, including preparation on the issues to be discussed as well as
meaningful and constructive contribution and inputs during meetings. In addition, the
Chairperson is evaluated on the key aspects of his/her role.
The performance of the committees was evaluated by the board after seeking inputs from
the committee members on the basis of criteria such as the composition of committees,
effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration
Committee reviewed the performance of individual directors on the basis of criteria such
as the contribution of the individual director to the board and committee meetings like
preparedness on the issues to be discussed, meaningful and constructive contribution and
inputs in meetings etc.
In a separate meeting of independent directors, performance of non-independent
directors, performance of the Board as a whole, performance of the Committee(s) of the
Board and performance of the Chairman was evaluated, taking into account the views of
other directors. Performance evaluation of independent directors was done by the entire
Board, excluding the independent director being evaluated.
FAMILIARISATION PROGRAMME:
All the Board members of the Company are provided every opportunity to familiarize
themselves with the Company, its management, its operations and industry perspective on a
regular basis. They are made to interact with senior management personnel and proactively
provided with relevant news, views and updates on the Company and sector. All the
information/documents sought by them is/are also shared with them for enabling a good
understanding of the Company, its various operations and the industry.
The Company organised an online presentation to the independent directors during which
the Senior Management team apprised the directors on the detailed operational aspects. The
Directors were also apprised on key aspects of operations and market trend and the
Companys performance and its future projects.
The details of programmes for familiarisation for Independent Directors are posted on
the website of the Company at www.srikalahasthipipes.com
NUMBER OF MEETINGS OF THE BOARD:
The details of the number of Meetings of the Board held during the Financial Year
2020-21 are given in the Corporate Governance Report which forms part of this report.
RELATED PARTY TRANSACTIONS:
All related party transactions (RPTs) entered into by the Company with its related
parties during the year under review were on arms length basis and in the ordinary
course of business and did not attract provisions of Section 188 of the Companies Act,
2013, thus disclosure in Form AOC-2 is not required. During the year 2020-21, as required
under Section 177 of the Companies Act, 2013 and Regulation 23 of the SEBI Listing
Regulations, 2015, all RPTs were placed before Audit Committee for its approval.
A statement showing the disclosure of transactions with related parties as required by
Ind AS 24 is given separately in this Annual Report under notes to financial statements.
There were no material transactions entered into with related parties, during the year
under review, which may with the interests of the have had any potential conflict Company.
The Company has formulated a policy on "Related Party Transactions" and the
process of dealing with such transactions, which are in line with the provisions of the
Companies Act, 2013 and SEBI LODR. The same is available on the website of the Company
http://www.
srikalahasthipipes.com/static-files/pdf/policies/related-party-transaction-policy.pdf.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The statement containing particulars of employees as required under Section 197 (12) of
the Companies Act, 2013 read with Rule 5 (2) of Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 forms part of this report. However, in terms of Section
136 of the Companies Act, 2013, the Annual Report excluding the aforesaid information is
being sent to all the members of the Company and others entitled thereto. The said
statement is available for inspection by the members at the Registered Office of the
Company during business hours on working days up to the date of the ensuing Annual General
Meeting. Any member interested in obtaining such particulars may write to the Company
Secretary at the Registered Office of the Company.
The ratio of the remuneration of each Director to the median employees
remuneration and other details in terms of subsection 12 of Section 197 of the Companies
Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is forming part of this report vide Annexure IV.
Energy conservation, technology absorption and foreign exchange earnings and outgo:
The information on conservation of energy, technology absorption and foreign exchange
earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with
Rule 8 of the Companies (Accounts) Rules, 2014 is given in Annexure V and forms part of
this report.
Annual Return:
Pursuant to Section 92(3), read with Section 134(3)(a) of the Act, a copy of the Annual
Return of the Company as on the Financial Year ended 31 March, 2020, in Form No. MGT-7,
can be accessed on the website of the Company, at
http://www.srikalahasthipipes.com/investors/ compliancereports/annualreturn.aspx.
Further, pursuant to Section 92(3) of the Act, the Annual Return of the Company as on
the Financial Year ended 31 March, 2021, will be duly uploaded on the website of the
Company, at http://www.srikalahasthipipes.com/investors/
compliance-reports/annual-return.aspx,upon filing of the same with the Registrar of
Companies, under Section 92(4) of the Act.
OTHER DISCLOSURES:
Particulars of information forming part of the Boards Report pursuant to Section
134 of the Companies Act, 2013 and relevant Rules thereof, not covered elsewhere in the
report are given hereunder:
1. The Company, as per its policy, has granted loans to employees aggregating Rs.39.32
lakhs during the year ended 31st March, 2021.
2. Particulars of Loans or investments covered under Section 186 of the Companies Act,
2013 form part of the notes to the financial statement provided in this
Annual Report. These loans are primarily granted for effective utilization of surplus
funds available with the Company.
3. There are no material changes or commitments occurring after 31st March, 2021, which
may affect the financial position of the Company or may require disclosure.
4. During the year under review, there has been no change in the nature of business of
the Company.
5. The Company did not have any subsidiaries, joint ventures and associate companies,
which have ceased during the year.
6. The Company has not accepted deposits under Chapter V of the Companies Act, 2013.
7. The Company has not received any such orders from Regulators, Courts or Tribunals
during the year, which may impact the going concern status or the Companys
operations in future.
8. The Company is in compliance with the Se cretarial Standards issued by the Institute
of Company Secretaries of India on Meetings of the Board of Directors (SS - 1) and General
Meetings (SS - 2).
9. Details in respect of frauds reported by auditors under sub-section (12) of section
143 other than those which are reportable to the Central Government Not Applicable.
10. Details of application made or any proceeding pending under the Insolvency and
Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end
of the financial year - Not Applicable.
11. Details of difference between amount of the valuation done at the time of one time
settlement and the valuation done while taking loan from the Banks or Financial
Institutions along with the reasons thereof -
Not Applicable.
12. Suspension of trading of Securities -Not applicable as none of the securities of
the Company are suspended from trading.
STATUTORY AUDITORS:
M/s. Lodha & Co., Chartered Accountants (Firm Reg. No. 301051E), were appointed as
Statutory Auditors of the
Company for a term of five years (subject to ratification by shareholders at every AGM,
if required, under the prevailing law at that time) to hold office from the conclusion of
25th Annual General Meeting held in 2017 till the conclusion of 30th Annual
General Meeting of the Company to be held in 2022.
The requirement to place the matter relating to appointment of the Auditors for
ratification by the members at every Annual General Meeting is done away with vide
notification dated 7th Ministry of Corporate Affairs. Accordingly, no resolution is of
appointment of the Auditors, proposedforratification who were appointed in the Annual
General Meeting held on 27th September, 2017. Further, the Notes on financial statements
referred to in the Auditors Report are self- explanatory and do not call for any
further comments.
The Auditors Report does not contain any qualification, reservation or adverse
remark.
MAINTENANCE OF COST RECORDS AND AUDIT THEREOF:
The Company is required to maintain cost records for Cement & Steel (DI Pipes) for
every Financial Year, as specified by the Central Government under Section 148(1) of the
Act, and accordingly, such accounts and records are made and maintained in the prescribed
manner.
In terms of the provisions of Section 148 of the Companies Act, 2013, read with the
Companies (Cost Records and Audit) Amendment Rules, 2014, the Board of Directors of your
Company have on the recommendation of the Audit Committee, appointed (particulars of the
Cost Auditor for 2020-21 shall be mentioned first) M/s. Narasimhamurthy & Co., Cost
Accountants, Hyderabad as Cost Auditors, to conduct the cost audit of your Company for the
financial year ending 31st March, 2022, at a remuneration as mentioned in the Notice
convening the Annual General Meeting. As required under the Act, the remuneration payable
to the cost auditor is required to be placed before the Members in a general meeting for
their ratification. Accordingly, a resolution seeking Members ratification for the
remuneration payable to Cost Auditors forms part of the Notice of the ensuing Annual
General Meeting. The Cost Audit Report of the Company for the Financial Year ended 31
March, 2020, as given by M/s Narasimhamurthy & Co., was filed in XBRL mode with the
Ministry of Corporate Affairs within the stipulated due date.
SECRETARIAL AUDITORS:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules
thereunder, Mr. S. Chidambaram, Company Secretary in Practice was appointed to conduct the
secretarial audit of the Company for the FY 2020-21.
The secretarial audit report confirming compliance by Practicing Company Secretary to
the applicable provisions of the Companies Act, 2013, SEBI LODR Regulations, 2015 and
other applicable laws is appended at Annexure VI to this report and it does not contain
any qualification, reservation or adverse remark.
INTERNAL AUDITORS:
In line with the provisions of Section 138 of the Companies Act, 2013, M/s. Chaturvedi
& Co, Chennai were appointed by the Board as Internal Auditors of the Company for the
FY 2020-21. The Audit Committee defines the scope of internal audit from time to time and
also reviews the observations 2018issuedbythe of internal auditors and the action
taken report submitted by the management on the observations at its meeting held every
quarter and also suggests the management the improvements required in the systems followed
by the Company.
GREEN INITIATIVE:
In support of "Green Initiative" taken by the Ministry of Corporate Affairs
("MCA") in the Corporate Governance" by allowing service of documents by a
Company to its Members through electronic mode, the Company will continue to send various
communications and documents like notice calling general meetings, audited financial
statements, directors report, auditors report etc., in electronic form, to the
email address provided by the Members to the Depositories or to the Company.
Your Company impresses upon its shareholders to contribute to this green initiative in
full measure by registering their e-mail addresses, in respect of electronic holdings with
the Depository through their concerned Depository Participant. Members whose e-mail ID is
not registered with the Company/Depositories are requested to take necessary steps for
registering the same so that they can also become a part of the initiative and contribute
to the Green Movement.
ANNEXURES TO THE BOARDS REPORT:
1. Corporate Governance Report is enclosed vide Annexure I.
2. Pursuant to Regulation 34 of Listing Regulations, 2015, Management Discussion and
Analysis Report is enclosed vide Annexure II.
3. Pursuant to Section 135 (4) (a) of the Companies Act, 2013 read with Rule 8 (1) of
the Companies (Corporate Social Responsibility Policy) Rules, 2014, the annual report on
CSR activities in the prescribed format, forming part of the Directors Report is
enclosed vide Annexure III.
4. Disclosure under Section 197 (12) read with Rule 5(1) of the Companies (Appointment
and remuneration of managerial personnel) Rules, 2014 is enclosed vide Annexure IV.
5. Pursuant to Section 134 (3) (m) of the Companies Act, 2013, information relating to
Conservation of Energy, Technology absorption and foreign exchange earnings and outgo is
enclosed vide Annexure V.
6. Pursuant to Section 204 (1) of the Companies Act, 2013 and Rule 9 of the Companies
(Appointment and remuneration of managerial personnel) Rules, 2014, the Secretarial Audit
Report is enclosed vide Annexure VI.
7. Pursuant to Regulation 34 of Listing Regulations, 2015, Business Responsibility
Report is enclosed vide Annexure VII.
DIRECTORS RESPONSIBILITY STATEMENT:
The Board of Directors of the Company confirms that:
I. In the preparation of annual accounts for the Financial Year ended 31st March, 2021,
the applicable accounting standards have been followed and there has been no material
departure.
II. The selected accounting policies were applied consistently and the Directors made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company as at 31st March, 2021 and of the profit of the
Company for the financial year ended 31st March, 2021.
III. Proper and sufficient care has been taken for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013 for
safeguarding the assets of the Company and for preventing and detecting fraud and other
irregularities.
IV. The annual accounts have been prepared on a going concern basis.
V. Sufficient internal financial controls have been laid down and such internal
financial controls are adequate and were operating effectively, and VII. Proper systems to
ensure compliance with the provisions of all applicable laws have been devised and such
systems were adequate and operating effectively.
ACKNOWLEDGEMENTS:
Your Directors wish to convey their appreciation to all of the Companys employees
for their contribution towards the Companys performance. Your Directors would also
like to thank the shareholders, employee unions, customers, dealers, suppliers, bankers,
Governments and all other business associates for their continuous support to the Company
and their confidence in its management on behalf of the Board.
Your Directors also wish to place on record their appreciation for the valuable support
received by your Company from Banks, Govt. Authorities, Customers, Auditors and other
stakeholders. The Board thanks the employees at all levels for the dedication, commitment
and hard work put in by them for Companys achievements. Your Directors are grateful
to the Shareholders/ Stakeholders for their confidence and faith reposed in the management
of the Company.
Your Directors also place on record their sincere appreciation for the valuable
guidance received from Mr Mayank Kejriwal, Managing Director and for his useful
contribution, which is instrumental in shaping the progressive growth of your Company.
For and on behalf of the Board of Directors
R.K. Khanna
Chairman
(DIN:05180042)
Dated: 4th May, 2021
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