To:
The Members of
Walchandnagar Industries Limited
Your directors take pleasure in presenting the 114th Annual Report on the
business and operations of your Company together with the Audited Financial Statements for
the year ended March 31, 2023.
1. Financial Results:
The Company's financial performance, for the Year ended March 31, 2023 is summarized
below:
|
Year ended 31.03.2023 |
Year ended 31.03.2022 |
|
Rs. in Lakhs |
Rs. in Lakhs |
Income: |
34,435 |
33,188 |
Profit/(Loss) before |
(1,716) |
5,390 |
Depreciation, Interest, |
|
|
Exceptional Item and |
|
|
Exchange currency fluctuations |
|
|
Less: Interest |
5,477 |
7,063 |
Depreciation |
1,868 |
2,224 |
Exceptional items |
10,539 |
- |
Profit/(Loss) before Exchange |
1,479 |
(3,897) |
Currency fluctuations |
|
|
Less: Exchange Currency |
480 |
90 |
Fluctuation Loss /(Gain) |
|
|
Profit/(Loss) before Tax |
1,958 |
(3,807) |
Less: Tax (Net) |
- |
- |
Profit/(Loss) after Tax |
1,958 |
(3,807) |
2. Financial Performance & Highlights:
During the year under review, the revenue for the Financial Year 2022-23 was 34,435
lakhs as against the previous financial year 2021-22 of Rs 33,188 lakhs.
During the Financial Year under review, KKR India Financial Services Ltd. has assigned
the entire debt (i.e. Loans and NCDs) due from the Company alongwith the underlying
financing documents together with lenders rights, benefits and obligations thereunder to
Assets Care & Reconstruction Enterprise Ltd. ("ACRE") acting in its capacity
as trustee of ACRE-120-TRUST. Further, the Company had signed Standstill agreement dated
July 19, 2022 with Assets Care & Reconstruction Enterprise Ltd. (in its capacity as
trustee of ACRE-120-TRUST) and Vistra ITCL (India) Limited as Security Trustee and
Debenture Trustee.
Material changes and commitments occurred after the close of the year till the date of
this Report, which affects the financial position of the Company. The Company has
successfully exited from the standstill arrangement under the Standstill Agreement and the
Company after discussion and negotiation, has agreed upon debt restructuring scheme with
ACRE and has signed Restructuring Agreement dated May 18, 2023 as amended/ supplemented
from time to time (Restructuring Agreement) with ACRE (Lender). Therefore, in accordance
with the provisions of IndAs 10 "Events After Reporting Date", the company has
accounted write back on debt restructuring of 10,539 Lakhs which is disclosed as
exceptional item in P&L.
3. SHARE CAPITAL
During the year under review, the Company has allotted 46,00,000 equity shares of Rs 2
each at Rs 60 per share to Promoters/ Promoters group and 32,10,000 equity shares of Rs 2
each at Rs 60 Per Share to ACRE towards conversion/ appropriation of part of the debt owed
to them by the Company. Also, the Company has made allotment of 83,019 equity shares of Rs
2 each to its eligible employees who have exercised their stock options under the
prevailing Employee Stock Option Scheme of the Company at regular intervals. As a result,
the paid-up equity share capital of the Company has increased to Rs 9,19,26,448 divided
into 4,59,63,224 equity shares of face value of Rs 2 each as on March 31, 2023.
4. Current Period:
The orders on hand as on March 31, 2023 were at Rs 922.07 crores as compared to Rs
669.36 crores as on March 31, 2022.
5. Exports and Overseas Projects:
During the year under review, the Company achieved an export turnover of Rs 14.42
crores as against Rs 15.48 Crores, in the previous year. The export orders on hand as on
March 31, 2023 are at Rs 310.89 crores.
6. Dividend and Reserves:
During the Year under review, your Company has profit after tax of Rs 1,958 lakhs
(includes exceptional item of Rs 10,539 lakhs). No dividend is recommended for the Year
ending March 31, 2023 by the Board.
7. Subsidiary, Joint Ventures and Associate Companies:
As on March 31, 2023, your Company does not have any Subsidiary, Joint Venture or
Associate Company. During the year under review, none of the Companies have become or
ceased to be the Company's Subsidiary, Joint Venture and Associate Company.
8. Extract of Annual Return:
Pursuant to Section 92 (3) and Section 134 (3) (a) of the Act as amended read with Rule
12 (1) of the Companies
(Management and Administration) Rules, 2014, the Annual Return of the Company as on
March 31, 2023 is available on the Company's website and the weblink for the same is
https://walchand.com/wp-content/uploads/2023/08/Form_ MGT_7%20WIL%20pdf.pdf.
9. Management Discussion & Analysis:
Management Discussion and Analysis Report for the year under review as stipulated under
SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 (Listing
Regulations) is enclosed as Annexure A' to this report.
10. Finance & Accounts: (i) Fixed Deposits:
Your Company did not invite or accept deposits from the public during the financial
year under review.
(ii) Income Tax Assessments:
Income tax Assessments u/s 143 (3) of Income Tax Act, 1961 up to the Assessment Year
2018-19 has been completed and the Assessment u/s 147 of the Act for A.Y. 2018-19 is in
progress as on 31/03/2023. Appeal proceeding before Commissioner of Income Tax (Appeals)
for Assessment Year 2014-15 to 2016-17 and A.Y. 2018-19 were in progress during the F.Y.
2022-23.
11. Human Resources Development:
During the Financial Year 2022-23, as a part of process improvement, the HR Department
has upgraded various forms, formats and policies to match the current business
requirements. Also HR department has implemented digitalization and improved Keka HRIS
process. As a part of Health & Wellness, various awareness programs were taken up for
the employees at WNR.
For employee Engagement, various fun activities are done: Movies on Fridays,
Musical Chair for women, Gudi Padwa Celebration, Hanuman Jayanti, Ramnavami, Diwali
Celebrations, Fort Making competition for children and New Year Celebration, Women's Day
celebration by Nari Shakti in WNR and in Corporate O_ice also and Dhuliwandan. Also
celebrated Dr. Babasaheb Ambedkar Jayanti, Shri Chatrapati Shivaji Maharaj Jayanti and
Mahavir Jayanti.
For the Learning and development of members: Training team had organized 55
training programs covering 1,288 Staff & workers (122 Man days covering 454 M
& S workmen, 221 Man days covering 838 workers). Trained & certified 62
Workers for LPT level 1 Training. For multiskilling of workmen, Skill development programs
were planned for 50 workmen in F.Y. 2022-23.
Hiring:
HR is adopting best hiring practices and using HRIS for preparing a resume database for
developing a strong external pool of talent. Structured Interviews (Competency-Based
Interviews) and background checking of new joiners are being implemented for ensuring the
hiring of good quality candidates. HR has signed MoU with the Defence Institute of
Advanced Technology (DIAT), Pune for collaboration in problem-solving, Research and
Development & Training of WIL members.
The true focus of Human Resources Management is motivating, bringing in Best HR
Practices & retaining the best talent in the Industry.
12. Directors' Responsibility Statement:
Pursuant to the requirement under Section 134 (3) (c) of the Companies Act, 2013, the
Directors hereby confirm that: i) in the preparation of the annual accounts, the
applicable accounting standards have been followed along with proper explanation relating
to material departures; if any ii) the Directors have selected such accounting policies
and applied them consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the Company at the
end of March 31, 2023 and of the profit for the Year ended on that date; iii) the
Directors have taken proper and su_icient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 2013 for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities; iv)
the Directors have prepared the annual accounts on a going concern basis; v) the Directors
have laid down internal financial controls to be followed by the Company and that such
internal financial controls are adequate and were operating effectively; and vi) the
Directors have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
Based on the framework of Internal Financial Controls and compliance systems
established and maintained by the Company with its inherent weaknesses, work performed by
the Internal, Statutory and Secretarial Auditors including audit of Internal Financial
Controls over financial reporting by Internal/ External Auditors and the Statutory
Auditors and the reviews performed by Management and the relevant Board Committees,
including the Audit Committee, the
Board is of the opinion that the Company's Internal Financial Controls were adequate
and effective during the Year ended on March 31, 2023.
13. Corporate Governance:
Your Directors believe that Corporate Governance is the basis of stakeholder
satisfaction. The Company is committed to maintain the highest standards of Corporate
Governance and adhere to the Corporate Governance Requirements as set out by the
Securities and Exchange Board of India (SEBI). Your Company has obtained a certificate
from Jayesh Sanghrajka & Co. LLP, Chartered Accountants, Statutory Auditors, on
compliance with Regulation 34 of Listing Regulations read with Schedule V of the Listing
Regulations. The Report of Corporate Governance along with Certificate from the auditors
of the Company regarding compliance of conditions of corporate governance is enclosed asAnnexure
B' to this Report.
14. Corporate Social Responsibility:
The Companies Act, 2013 mandates that every Company who meets certain eligibility
criteria needs to spend at least 2% of its average net profit for the immediately
preceding three financial years on Corporate Social Responsibility activities. In view of
losses, statutorily no amount is required to be spent by the Company. However, Corporate
Social Responsibility is an integral part of the Company.
Over the years, the Company has taken and continues to take several initiatives to
support Environment, Education and Health related activities in order to fulfill its
corporate social commitments.
Health Activities:
Company has organized Medical Health Check-up camps for all employees and their family
members wherein 102 persons have been benefitted and 47 M&S staff for heart-related
issues, ECG, and a lipid profile test have been benefitted. Further Medical Camp was
organized for women wherein 82 women from our WIL employees' families and school teachers
attended. A medical camp was organized for women of Walchandnagar through the Nari Shakti
Group, which is founded by women employees and Blankets were donated by to an orphanage by
Nari Shakti Group.
Education:
The schools established by the Company continued to impart education up to Higher
Secondary grade to children staying in Walchandnagar and nearby villages. Further, Company
has provided 100% school fees concession to 3 students of demised workers. The Company
also provided 50% school fee concession to 451 children of WIL Employees ward. Further,
the Company has provided 25% fee concession to 20 teachers (SWV and PRI) and WSB
employees' wards and
75% fee concession to 46 BCA teachers' wards. 1325 students were insured for Accidental
happenings under UNI STUDY CARE Policy of United India Insurance Co. Ltd. Insurance
Awareness Camp were organized for Employees by LIC and Bank of India, WNR. Financial
Assistance was provided for medical reasons and payment of school fees of needy employees
and students was done under BCA CARE Activity.
Environment:
To maintain a pollution free atmosphere and to spread awareness about environmental
protection, the Company had undertaken proper care in maintaining the plantations in
Walchandnagar.
On the eve of 51st National Safety Week, Instrumentation Division, Dharwad
executed Cleaning Project. The CSR Policy is available on the website of the Company and
the link for the same is
https://walchand.com/wp-content/uploads/2022/07/Corporate-Restructuring-Policy. pdf.
15. Energy conservation, Technology absorption & Foreign Exchange:
Pursuant to Section 134 (3) (m) of the Companies Act, 2013, read with the Companies
(Accounts) Rules 2014, information on conservation of energy, technology absorption,
foreign exchange earnings and out-go is enclosed as Annexure C' to this Report.
16. Personnel:
Employee relations remained harmonious and satisfactory during the year and your Board
would like to place on record their sincere appreciation for sustained efforts and valued
contribution made by all the employees of the Company.
17. Directors and Key Managerial Personnel:
1) Independent Directors: a) Declaration by Independent Directors:
Your Board has reviewed the declarations made by the Independent Directors and is of
the view that they meet the criteria of Independence as provided in Section 149 of the
Companies Act, 2013 and Rules made there under and Regulation 16 (1) of Listing
Regulations (including any statutory modification(s) or reenactment(s) thereof for
the time being in force). b) Completion of Tenure of Independent Directors:
Mr. Dilip J. Thakkar had ceased to be the Director of the Company w.e.f. September 28,
2022 upon completion of his term as an Independent Director.
The Board places on record its appreciation for the assistance and guidance provided by
him during his tenure as Director of the Company. Mr. Jayesh Dadia was appointed as a
Non-Executive Independent Director of the Company w.e.f. May 30, 2022 and Mr. G. S.
Agrawal was appointed as a Whole Time Director of the Company w.e.f. August 02, 2022.
2) Retirement by rotation:
Pursuant to Article 86 of the Articles of Association of the Company and Section 152 of
the Companies Act, 2013, Mr. Chakor L. Doshi is due to retire by rotation at the 114th
Annual General Meeting and being eligible, has offered himself for re-appointment.
Brief profile of the proposed appointees together with other disclosures in terms of
Regulation 36 (3) of the Listing Regulations are mentioned in the Notice which is a part
of this Annual Report.
The Company Vide Postal Ballot passed Special Resolution for Continuance of term of
Non-Executive Director who shall attain the age of 75 years on September 15, 2023. Mr.
Chakor L. Doshi, Non-Executive Director of the Company shall continue as Non-Executive
Director of the Company after attaining the age of 75 years on September 16, 2023.
18. Number of Meetings of the Board:
The Board met seven (7) times during the year from April 01, 2022 to March 31, 2023 on
May 30, 2022; August 02, 2022; August 29, 2022; October 21, 2022; November 09, 2022;
February 13, 2023 and March 29, 2023.
19. Committees of the Board:
The Company has several Committees which have been constituted in compliance with the
requirements of the relevant provisions of applicable laws and statutes.
Audit Committee which comprises of two Independent Directors i.e. Mr. Jayesh
Dadia (Chairman of Committee) and Dr. Anil Kakodkar (Member), and Chairman, Mr. Chakor L.
Doshi (Member). Mr. Dilip J. Thakkar ceased to be a Chairman/ Member of the Committee
w.e.f. September 28, 2022 due to completion of his 2nd term as Independent
Director. Mr. Jayesh Dadia was elected as the Chairman of the Committee w.e.f. September
29, 2022. Mrs. Rupal Vora was inducted as a member of the Audit Committee for the Audit
Committee meeting held on February 13, 2023.
Stakeholders Relationship Committee which comprises of two Independent Directors
i.e.
Dr. Anil Kakodkar (Chairman of Committee) and Mr. Jayesh Dadia (Member) and Chairman,
Mr. Chakor L. Doshi (Member). Mr. Dilip J. Thakkar ceased to be a Member of the Committee
w.e.f. September 28, 2022 due to completion of his 2nd term as Independent
Director. Mr. Jayesh Dadia was elected as the Member of the Committee w.e.f. September 29,
2022. Nomination & Remuneration Committee which comprises of two Independent
Directors i.e. Dr. Anil Kakodkar (Chairman of Committee), Mrs. Rupal Vora (Member) and
Chairman, Mr. Chakor L. Doshi (Member). Mr. Dilip J. Thakkar ceased to be a Member of the
Committee w.e.f. September 28, 2022 due to completion of his 2nd term as
Independent Director. Mrs. Rupal Vora was elected as the Member of the Committee w.e.f.
September 29, 2022.
Corporate Social Responsibility Committee which comprises of an Independent
Director, Mrs. Rupal Vora (Chairperson of Committee), Managing Director & C.E.O., Mr.
Chirag C. Doshi (Member) and Chairman, Mr. Chakor L. Doshi (Member).
20. Board Evaluation:
Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared.
The Performance Evaluation of the Independent Directors was completed. Independent
Directors Meeting/ Board Meeting considered the performance of Non-Independent Directors
and the Committees and Board as a whole, reviewed the performance of the Chairman of the
Company, taking into account the views of Executive Directors and Non-Executive Directors
and assessed the quality, quantity and timeliness of flow of information between the
Company Management and the Board.
The Nomination & Remuneration Committee has determined a process for evaluating the
performance of every Director, Committees of the Board and the Board on an annual basis.
21. Vigil Mechanism:
Your Company is committed to highest standards of ethical, moral and legal business
conduct. Accordingly, in compliance with Section 177 of the Companies Act 2013, and the
Listing Regulations, the Board of Directors have formulated a Whistle Blower Policy to
report genuine concerns or grievances. Protected disclosures can be made by a whistle
blower through an e-mail, or telephone line or a letter to the Chairman of the Audit
Committee or the Company Secretary of the Company or any member of the Audit Committee.
The Policy on vigil mechanism / whistle blower may be accessed on the Company's website at
the link https://walchand.com/ wp-content/uploads/2022/07/Whistleblower-Policy.pdf.
22. Particulars of Employees Remuneration:
(A) The ratio of the remuneration of each Director to the median employee's
remuneration and other details in terms of Section 197 (12) of the Companies Act, 2013
read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, are forming part of this Report as Annexure D'.
(B) The information as required under Rule 5 (2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 will be provided upon the request by any
member of the Company. In terms of Section 136 (1) of the Companies Act, 2013, the Report
and the Accounts are being sent to the members excluding the said Annexure. Any member
interested in obtaining copy of the same may write to the Company Secretary at the
Registered O_ice of the Company. Upon such request, information shall be furnished.
23. Particulars of Contracts and Arrangements with Related Parties:
All Contracts/ arrangements/ transactions entered into by the Company during the
Financial Year under review with related parties were on an arm's length basis and in the
Ordinary Course of Business. There were no materially significant related party
transactions which could have potential conflict with the interest of the Company at
large. During the year, the Company has not entered into any contract / arrangement /
transaction with related parties which could be considered material in accordance with the
policy of the Company on materiality of related party transactions.
All Related Party Transactions were placed before the Audit Committee for approval. The
policy on Related Party Transactions as approved by the Board is uploaded on the Company's
website at the following link: https://
walchand.com/wp-content/uploads/2022/07/Related-Party-Transaction-Policy.pdf.
Your Directors draw attention of the members to Note no. 48 to the Financial Statements
which sets out related party disclosures.
24. Nomination & Remuneration Policy:
The Board has framed a policy on the recommendation of the Nomination &
Remuneration Committee, which lays down a framework in relation to remuneration of
Directors, Key Managerial Personnel and Senior Management of the Company. This policy also
lays down criteria for selection, appointment and remuneration of Board Members / Key
Managerial Personnel and other senior employees.
Objectives:
The Nomination and Remuneration Committee and this Policy is in compliance with Section
178 of the Companies Act, 2013 read along with the applicable rules thereto and Regulation
19 of the Listing Regulations.
The Key Objectives of the Committee are: a) to formulate guidelines in relation to
appointment and removal of Directors, Key Managerial Personnel and Senior Management. b)
to evaluate the performance of the members of the Board and provide necessary report to
the Board for further evaluation of the Board. c) to recommend to the Board, the
Remuneration payable in whatever form to all the Directors, Key Managerial Personnel and
Senior Management.
Role of Committee:
The role of the Committee is explained in the Corporate Governance Report.
Nomination Duties:
The duties of the Committee in relation to nomination matters include: a) Ensuring that
there is an appropriate induction & training programme in place for new Directors and
members of Senior Management and reviewing its effectiveness. b) Ensuring that on
appointment to the Board, Non-Executive Directors receive a formal letter of appointment
in accordance with the Guidelines provided under the Companies Act, 2013 and SEBI
Guidelines. c) Identifying and recommending Directors who are to be put forward for
retirement by rotation. d) Determining the appropriate size, diversity and composition of
the Board. e) Setting a formal and transparent procedure for selecting new Directors for
appointment to the Board. f) Developing a succession plan for the Board and Senior
Management and regularly reviewing the plan. g) Evaluating the performance of the Board
and Independent Directors. h) Making recommendations to the Board concerning any matters
relating to the continuation in office of any Director at any time including the
suspension or termination of service of an Executive Director as an employee of the
Company subject to the provision of the law and their service contract. i) Delegating any
of its powers to one or more of its members or the Secretary of the Committee. j)
Recommend any necessary changes to the Board. k) Considering any other matters as may be
requested by the Board. l) For every appointment of an Independent Director, the Committee
to evaluate the balance of skills, knowledge and experience on the Board and on the basis
of such evaluation, prepare a description of the role and capabilities required by an
Independent Director. The person recommended to the Board for appointment as an
Independent Director shall have the capabilities identified in such description. For the
purpose of identifying suitable candidates, the Committee may: a) use the services of
external agencies, if required; b) consider candidates from a wide range of backgrounds,
having due regard to diversity; and c) consider the time commitments of the candidates.
Remuneration Duties:
The duties of the Committee in relation to remuneration matters include: a) to consider
and determine the Remuneration Policy, based on the performance and also bear in mind that
the remuneration is reasonable and su_icient to attract, retain and motivate members of
the Board and such other factors as the Committee shall deem appropriate. b) to approve
the remuneration of the Senior Management including Key Managerial Personnel of the
Company maintaining a balance between fixed and incentive pay reflecting short and long
term performance objectives appropriate to the working of the Company. c) to delegate any
of its powers to one or more of its members or the Secretary of the Committee. d) to
consider any other matters as may be requested by the Board. e) to consider and recommend
to the Board, professional indemnity and liability insurance for Directors and senior
management.
The Nomination and Remuneration policy is available on the website of the Company and
the weblink for the same is https://walchand.com/wp-content/
uploads/2022/07/Nomination-Remuneration-Committee-Policy.pdf.
25. Risk Management:
Risk Management policy was approved in the Board Meeting wherein all material risks
faced by the Company were identified and assessed. For each of the risks identified,
corresponding controls were assessed and policies and procedures were put in place for
monitoring, mitigating and reporting risk on a periodic basis.
26. Internal Financial Control Systems:
Details of the Internal Financial Control Systems is explained in the "Management
Discussion and Analysis" which is enclosed as Annexure A' to this
report.
27. Insurance:
The properties, stocks, stores, assets, etc. belonging to the Company continue to be
adequately insured against fire, riot, civil commotion etc.
28. Dematerialization of Shares:
The Company's shares are listed on BSE Limited and National Stock Exchange of India
Ltd. and the Company's Registrar and Share Transfer Agent has connectivity with National
Securities Depository Ltd. & Central Depository Services (India) Ltd. The ISIN is
INE711A01022. As on March 31, 2023, total dematerialized equity shares are 4,55,50,199
representing 99.10%.
29. Company's Website:
The Company has its website namely www.walchand. com. The website provides detailed
information about the business activity, locations of its offices and all other
information as required under SEBI (LODR) Regulations. The Quarterly Results, Annual
Reports, Shareholding Patterns and Investor Presentations, all other communication with
the Stock Exchanges and various policies are placed on the website of the Company and the
same are updated periodically.
30. Means of Communication:
The Company has designated investors@walchand.com as an email id for the purpose of
registering complaints by investors and has displayed the same on the website of the
Company.
31. Auditors and Auditor's Report: Statutory Auditor:
M/s. Jayesh Sanghrajka & Co. LLP, Chartered Accountants, was appointed for their
second term in the 113th Annual General Meeting (AGM) as Statutory Auditors of
the Company to hold office from the conclusion of the 113th AGM until the
conclusion of the 118th AGM.
Auditors Report:
The notes forming part of the accounts referred in the Auditors' Report are self
explanatory and give complete information. There are no qualifications, reservation or
adverse remarks made by the Statutory Auditors in the Audit Report.
Cost Auditors and Cost Audit Report:
M/s. S. R. Bhargave & Co., Cost Accountants have been duly appointed as the Cost
Auditors for conducting Cost Audit in respect of products manufactured by the Company
which are covered under the Cost Audit Rules for current financial year ending March 2024.
They were also the Cost Auditors of the Company for the previous year ended March 2023. As
required by Section 148 of the Companies Act 2013, necessary resolution has been included
in the Notice convening the Annual General Meeting, seeking ratification by the Members to
the remuneration proposed to be paid to the Cost Auditors for the financial year ending
March 2024. The Cost Audit Reports for the financial year ended March 2023, will be filed
within the stipulated time i.e. on or before September 30, 2023.
Secretarial Auditors and Secretarial Audit Report:
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board
has appointed M/s. V. N. Deodhar & Company, Practicing Company Secretary, to undertake
Secretarial Audit of the Company for the year April 01, 2022 to March 31, 2023. The
Secretarial Audit Report for the year ended March 31, 2023 is annexed herewith marked as Annexure
E' to this Report. No observations/ qualifications/ reservations/ adverse
remarks were made by M/s. V. N. Deodhar & Company, Secretarial Auditors of the Company
in their report. The Board has reappointed M/s. V. N. Deodhar & Co. as Secretarial
Auditors for the Financial Year 2023-24 also.
Reporting of Frauds by Auditors:
During the year under review, the Statutory Auditors, the Secretarial Auditors or the
Cost Auditors have not reported to the Audit Committee, under Section 143 (12) of the
Companies Act, 2013, any instances of fraud committed against the Company by its
officers or employees, the details of which needs to be mentioned in the Board's Report.
32. Particulars of Loans, Guarantees or Investments by Company:
Particulars of Loans given, Guarantees and Investments covered under the provisions of
Section 186 of the Companies Act, 2013 are provided in the notes to the Financial
Statements (Please refer Notes to the Financial Statements).
33. Employees Stock Option Scheme:
With the perspective of promoting the culture of ownership and to attract, retain,
motivate and incentivize senior as well as critical talent, the Company has approved
"WIL - Employees Stock Option Plan 2020". The Nomination and Remuneration
Committee inter alia administers and monitors Employees' Stock Option Scheme of the
Company and from time to time, grants stock options to the employees. The Scheme is in
line with the Securities Exchange Board of India (Share Based Employee Benefits)
Regulations, 2014 ("SBEB Regulations"). The certificate from the Practicing
Company Secretary confirming the compliance of the Securities and Exchange Board of India
(Share Based Employee Benefits) Regulations, 2014 with respect to the Company's Employees
Stock Option Scheme Plans has been received and will be available for inspection through
electronic mode. Any member interested in obtaining the same may write to the Company
Secretary and the same will be furnished on request.
34. Prevention of Sexual Harassment of Women at Workplace:
Your Company has in place "Prevention of Sexual Harassment Policy" in line
with the requirements of The Sexual Harassment of Women at the Workplace
(Prevention, Prohibition & Redressal) Act, 2013. An Internal Complaints Committee
(ICC) has been set up to redress complaints received regarding sexual harassment. All
employees (permanent, contractual, temporary, trainees) are covered under this Policy.
During the year under review, there were no cases filed pursuant to the Sexual Harassment
of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
35. Secretarial Standards:
The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating
to Meetings of the Board of Directors' and General Meetings', respectively,
have been duly followed by the Company.
36. Familiarization Programme for Independent Directors:
To provide insights into the Company to enable the Independent Directors to understand
the Company's business in depth which would facilitate their active participation in
managing the Company, the Company arranges familiarization programmes for Independent
Directors. The details of such familiarization programmes for Independent Directors are
posted on the website of the Company viz. https://walchand.com/wp-content/
uploads/2023/03/FAMILIARIZATION-PROGRAMME-FOR-INDEPENDENT-DIRECTORS.pdf.
37. General:
Your Directors state that no disclosure or reporting is required in respect of the
following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. No significant or material orders were passed by the Regulators/ Courts/ Tribunals
which would impact the going concern status of the Company and its future operations.
38. Acknowledgements:
Your Directors wish to place on record their deep sense of appreciation for the
committed services by the Company's executives, staff and workers.
Your Directors also place on record their sincere appreciation for the assistance and
co-operation received from the banks, financial institutions, customers, suppliers and the
shareholders from time to time.
MANAGEMENT DISCUSSION AND ANALYSIS Economic Overview
Recovering from the pandemic-induced contraction, effects of the Russian-Ukraine
conflict and inflation, the Indian economy staged a broad based recovery across sectors
thereby tending towards the pre-pandemic growth path in FY23. India's GDP growth is
expected to remain robust in FY24 as well. GDP forecasts for FY24 by various Indian and
global agencies are in the range of 6-6.5 %. Private consumption in H1 of FY 23 was the
highest since FY15 and this led to a boost to production activity resulting in enhanced
capacity utilization across sectors. The capital expenditure of central government and the
strengthening of the balance sheets of the corporates have been some of the growth drivers
of the Indian economy in FY 23. Retail inflation was back within RBI's target range since
November 2022 which has considerably eased concerns around an entrenched inflationary
trend as has been seen in other major global economies. The Indian Rupee performed well
compared to other emerging market economies across most of FY 23 thereby providing succour
on the import front. Deft management of oil supplies from Russia has ensured that India
has not been exposed to the vagaries of the so called energy crisis that most of the
developed world especially Europe went through the early part of FY 23. The economic
growth is expected to receive a boost from the expansion of public digital platforms and
measures to ramp up manufacturing output. Extension of PLI scheme to cover more and more
sectors hitherto not focussed upon for ramp up in manufacturing output as well as further
coverage of defence related hardware in the negative imports list are policy steps in the
right direction.
Impact on WIL & notable achievements
The ongoing Russia-Ukraine war resulted into an adverse impact on the global economy,
disrupted supply chains and caused a surge in commodity prices; which ultimately led to
higher input costs and volatility in material prices. This is where the balanced business
portfolio of your company played an important role in cushioning the impact. The stress in
margins seen in industrial products was partially negated by the resilient margins in the
strategic sectors. It also helped that most of the order booking especially for the
industrial products businesses for FY 22-23 happened in H1 wherein the cost inflation was
passed on through price increases. We did reap the benefits of this in H2 when the prices
of commodities especially steel softened/stabilized to some extent. As far as capital
goods are concerned, many core industrial sectors saw healthy growth with the government's
continued thrust on infrastructure development. Sectors like cement, specialty chemicals,
sugar which are sources for WIL's orders registered a sustained growth momentum reflecting
in higher CAPEX spends compared to FY22. The index of industrial production (IIP) and the
purchasing manager's index for manufacturing (PMI) stayed vibrant throughout FY 23. The
year also bought along with it significant business opportunities which is reflected in
healthy order booking in the Gear and Crushing & Grinding businesses. The Centrifugals
business which caters to the Sugar industry also saw a record of order volumes not seen in
the past 10 years (primarily due to CAPEX upswing in the Sugar sector which had seen muted
activity during the pandemic years and which was also buoyed by the ethanol blending
policy). The long gestation orders in the Nuclear Plant Equipment business also fructified
and this puts WIL in an enviable position with a full order book in this niche business
for the next 3-4 years. WIL continues to consolidate its position in its flagship and
strategic businesses i.e. Defence and Aerospace which will be the mainstay of its focus,
investment and innovation in the years ahead. A few key achievements in the year gone by
are as follows:
1) Successful qualification in 4 new missile programs thereby making WIL qualified for
a total of 10 missile programs of DRDO.
2) Received the first sample batch order of ASTRA missile, full-fledged production to
take off shortly.
3) Successful development, manufacturing, testing and delivery of missile launchers for
strategic programs.
4) Successful manufacturing and delivery of key sub-assemblies of "Crew Escape
System" for the human space flight program Gaganyaan).
5) Major share in the manufacturing, delivery and assembly of core equipment for the
first ultrasonic wind tunnel for ISRO.
6) Successfully booked orders worth INR 250 Crore plus for core Nuclear Power Plant
Equipment Reactor Header, Calandria, End Shields, Heat Exchangers.
7) INR 50 Crore plus order booking in both Gear and Crushing
& Grinding Solutions businesses. 100 plus Centrifugal Machines orders successfully
won.
Performance Overview
Summary of the revenue & profitability for FY 2022-23 as compared to previous
financial year is tabulated below: Rs ( In Lakhs)
Particulars |
FY 2022-23 |
FY 2021-22 |
Total Income |
34,435.24 |
33,188.00 |
EBIDTA (Before Exceptional Items & |
(1,716.09) |
5,390.00 |
Exchange Currency fluctuations) |
|
|
EBIDTA (After Exceptional Items & |
9,302.73 |
5,480.00 |
Exchange Currency fluctuations) |
|
|
Profit / (Loss) Before Tax (PBT) |
1,958.04 |
(3,807.00) |
Profit / (Loss) After Tax (PAT) |
1,958.04 |
(3,807.00) |
Cash Profit / (Loss) (Including |
7,258.62 |
(1,234.86) |
Exceptional Items) |
|
|
Cash Profit / (Loss) (Excluding |
(3,280.68) |
(1,234.86) |
Exceptional Items) |
|
|
Fully diluted EPS |
4.26 |
(10.00) |
Cash Profit = PAT + Depreciation + Provision for doubtful debts(excl. bad debts)
(All figures in INR lakhs except EPS, which is an absolute number)
WIL has a healthy order book of INR 909 Crore as on 31st March 2023. This
value is almost 36% higher than the corresponding value at the beginning of FY23. Out of
the new orders booked in FY 23 (INR 472 Crore), the highest numbers came from Nuclear (INR
254 Crore) followed by Crushing & Grinding Solutions (INR 88 Crore) and Gear (INR 50
Crore). The order portfolio is quite well balanced at the moment with 52% by value coming
from strategic businesses and the rest from industrial products. It will be your company's
topmost priority to grow the order book even further in FY24. Factors like near to
mid-term probability for scaling up of new missile programs, diversification of industry
base in Crushing & Grinding Solutions, deepening relationship with DRDO and NPCIL
would aid in the same laying the base for scaling up of the revenue in the period ahead.
There is also a lot of emphasis going to be laid on exports with the current geopolitical
situation opening up new opportunities.
Human Resources Development
Market volatility also caused considerable attrition in some of the industry sectors.
While WIL also faces these market risks, our HR team has ensured that sourcing of the
right talent has not been a constraint for us. Your company plans to revive some of the
practises that faced hindrances during the pandemic years like "Graduate Engineer
Trainee" program, "Diploma Engineer Trainee" program to have a constant
feed of young talent and fresh ideas into our ecosystem. As has been mentioned elsewhere,
a critical look at the organization structure across business and functions,
identification of skill gaps, succession planning and attrition management are areas which
we continue to focus upon on an ongoing basis. In order to have interoperability across
locations, we would also be strengthening the mechanism of inter-location transfer of
manpower (specifically workmen) so that there is better diversity, sharing of best
practises and optimal utilization of human resources.
Risk Management & Control
Your company diligently assesses the risks & plans for mitigation every year during
our annual business planning sessions. Periodic reviews ensure a check on the impact &
implementation of the mitigation plan. Types of risks & priorities get modified with
the changing business profile, economic scenario, and other critical external and internal
factors. With a clear strategic decision, WIL has decided to become future ready, have a
system driven approach for processes & process automation wherever possible to reduce
the procedural delays. In the current scenario, WIL has adopted a balanced approach of
stringent project management in case of newly acquired manufacturing orders and phase-wise
completion & clearance of legacy EPC projects to effectively mitigate the risk. In
addition to the above, our internal audit function continues to have Risk Based Internal
Audit (RBIA) for end-to-end processes & necessary control, transaction audit to ensure
monetary transactional accuracy, and accounting & control audits for various process
transactions in the ERP system for ensuring proper discipline in the system.
Another critical area which is being addressed is the fool-proof ring-fencing of your
company's intellectual assets, IT systems and associated hardware/software from malicious
threats emanating from cyberspace. A comprehensive assessment of the risks involved is
already in progress with mitigatory action planned in a phase-wise manner.
Technology Upgradation & Product Development
WIL continues to improve our manufacturing capabilities through automation as well as
manual process improvements. Especially, our product business portfolio has tremendous
scope for product development by offering IOT solutions, improved aesthetics & product
performance to the customer. Strategic businesses are focusing towards improving
manufacturing e_iciency & quality with the help of improved tooling, work centre
arrangement & plant layout, welding improvements, etc. Development and successful
deployment of the 2000 kg centrifugal machine and design & fabrication of the jacketed
kiln solution for the Fluorochemicals sector have been prime examples of product
development in the last fiscal year. Your company continues to broaden it's already strong
footprint in the strategic sectors too with 4 new qualifications for missile programs and
participation in new flight hardware development for ISRO On the process/workflow
automation front, your company is happy to announce that it has now moved on to a fully
automated "Supplier Relationship Management (SRM)" platform which was custom
developed for WIL by Salesforce Inc. Also the Business intelligence (BI) platform has now
been made operational in such a way that critical operating and financial parameters are
now being tracked at the relevant business head levels on a real time basis thus leading
to prudent decision making, corrective actions, etc.
Strategic Initiatives
To lay down a strong foundation for sustainable growth of the company and the strategic
directions planned to achieve those, your company undertook certain strategic initiatives
in FY 23 which would also be continued in the current fiscal year. These primarily include
optimization of plant capacity utilization and throughout by following the "one
plant" concept, interoperability between businesses in terms of resources (men,
machines) at the plant level. We are also planning to undertake collaborative
consultations with industry bodies and associations (one example is Indian Institute of
Foundrymen) for benchmarking our manufacturing processes, layout and equipment with the
best in industry and take steps towards superior quality, aesthetics and execution. A
sustained "Communication and Branding" initiative has also been set in motion to
improve visibility of your company via media and social media outreach with the objective
of being looked upon as a strategic business partner and a great place to work.
Cautionary Statement
The statements in the "Management Discussion and Analysis Report" describe
your Company's objectives, projections, expectations, estimates or forecasts which may be
"forward-looking statements" within the meaning of the applicable laws and
regulations. Actual results may differ substantially or materially from those expressed or
implied therein due to risks and uncertainties. Important factors that could influence the
Company's operations, inter alia, include global and domestic demand and supply conditions
affecting selling prices of finished goods, input availability and prices, changes in
Government regulations, tax laws, economic, political developments within the country and
other factors such as litigations and industrial relations.
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