emkay taps cutting tools ltd Directors report

Results of Operations

The total revenue from operation for the F.Y. 2022-23 is INR 8,861.57 lakh marking increase of 25.15% to last years operational revenue generation of INR 7,080.67 lakh. The company has earned Profit before depreciation, Interest and Taxes (PBDIT) of INR 5987.67 lakh during the financial year under review over the previous financial years PBDIT of INR 4744.29 lakh. The profit after tax for the financial Year 2022-23 was INR 4412.78 as against profit after tax of INR 3525.91 lakh for the financial year 2021-22.

Amidst adverse global economic difficulties, the company was able to secure satisfactory growth in the national and international business during the year under review. The Company managed well to navigate the challenges ahead and gain market share.

The company has two wind farm projects one at Shivapura Kavalu Village, Belur Taluka, Hassan District in Karnataka and the other at Kita & Ugawa District, Jaisalmer in Rajasthan, both are developed and maintained by Suzlon Energy Limited and Enercon (India) Limited respectively. The combine contribution of the two wind farm projects to the gross revenues in the F.Y. 2022-23 was INR 149.49 lakh from the power sale during the year under review.

Share Capital

The paid-up equity share capital as on 31st March 2023 was 10671300 equity shares of INR 10/- each (Rupee Ten only) amounting to total of INR 10,67,13,000. The Company has not issued any shares with differential voting rights or granted stock options or sweat equity or through any other permissible mode during the FY 2022-23.

Dividend

Your Board of Directors did not recommend dividend for the year under review.

Transfer to Reserve

The Company has not transferred any amount to any reserve during the year under review.

Material changes / developments during the year:

There are no material changes and development affecting the financial position of the Company which has occurred during the Financial Year ended on 31st March 2023.

Material Changes / Events after the date of balance Date

Proposed Scheme of Arrangement - Demerger of Manufacturing Undertaking Your Board of Directors in their meeting held on June 29, 2023 has approved the Scheme of Arrangement between Emkay Taps and Cutting Tools Limited ("the Demerged Company") and Emkay Tools Limited ("Resulting Company") and their respective Shareholders and Creditors under Sections 230 to 232 read with Section 66 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 and rules and regulations framed thereunder. An application under Regulation 37 of the SEBI (LODR) Regulations, 2015 for the proposed Scheme of Arrangement has been submitted to National Stock Exchange of India Limited ("NSE" or "the Stock Exchange") and Securities Exchange Board of India (SEBI) through the Stock Exchange for obtaining their Observation Letter(s) (NOC) to file the Scheme for seeking approval of NCLT.

Change in the nature of business

During the year under review, there is no change in the nature of business of the company. Deposits During the year under review, the Company did not accept any deposits from the public within the ambit of section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

Particulars of loans, guarantees or investments under section 186 of the Companies Act, 2013 Pursuant to Section 186 of the Companies Act, 2013, the details of the Loans given, guarantees on securities provided and investments made are as under:

Subsidiary, Associate and Joint Venture

The Company does not have any Associate and Joint Venture Company during the year under review. However, the Board of Directors in their meeting held on March 30, 2023 has decided to incorporate a wholly owned Subsidiary with an authorized capital of INR 15,00,000/-, which has been subsequently increased to INR 1,25,00,00/-, and a paid up capital of INR 1,00,000/-. Emkay Tools Limited, a Wholly Owned Subsidiary has been incorporated by Registrar of Companies, Maharashtra Mumbai on April 25, 2023.

Corporate Governance

The Company has taken all necessary steps to implement the provisions of the Regulations and detailed Corporate Governance Report for the F.Y. 2022-23 forms integral part of this Annual Report.

Management Discussion and Analysis [MDA]

Management Discussion and Analysis, for the year under review, as stipulated under Regulation 34 (2) (e) of SEBI (LODR), 2015, is presented in a separate section forming integral part of this Annual Report.

Related party transactions

All contracts/ arrangements/transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arms length basis. There were no materially significant transactions with related parties during the financial year which were in the conflict of interest of the Company. An "Annexure A- Form AOC-2" on Related Party disclosures for the year under review, form part of this Annual Report.

Extract of Annual Return

In accordance with section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual Return is available on www.etctl.com Board Meetings During the year under review 05 (five) Board Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013. The details of Meetings of the Board and its Committees are given in the Corporate Governance Report.

Committees

Pursuant to the provisions of the Act and Rules made there under and SEBI (LODR) regulation, 2015, the board has constituted various committees. Composition and other details on the committee are given in the Corporate Governance Report.

Directors and Key Management Personnel

I. Retirement by Rotation

In accordance with the provisions of section 152[6] of the Companies Act, 2013 and in terms of Articles of Association of the Company, Mr. Ajayprakash Kanoria (DIN: 00041279) retires by rotation at the ensuing Annual General Meeting (AGM) and being eligible offers himself for re-appointment. The Board recommends him reappointment by the members at the ensuing AGM.

II. Profile of the Directors seeking Appointment / Reappointment As required under Regulation 36 (3) of SEBI (LODR), 2015, particulars of the Directors retiring by rotation and seeking appointment / reappointment at the ensuing Annual General Meeting is annexed to the notice convening 28th Annual General Meeting.

III. Re-appointment of Managing Director and Whole time Director

In accordance with the provisions of section 196[2] of the Companies Act, 2013 Mr. Ajayprakash Kanoria and Mrs. Alka Kanoria has been reappointed as Managing Director and Whole-time Director respectively, to be effective from 1st April, 2024 for 5 years till 31st March, 2029 by the Board of Directors in their meeting held on August 25, 2023 subject to approval of Members of the Company at this annual general meeting.

IV. Key Managerial Personnel

V. Board Evaluation Pursuant to the provisions of the Act and Rules made thereunder and as provided under Schedule IV of the Act and Regulation 17(10) of SEBI (LODR), 2015, annual performance evaluation of the Directors individually as well as its committees has been carried out by the Board.

The Policy for Evaluation of Performance of the Board of Directors was formulated by Nomination and Remuneration Committee of the Board of Directors and same has been approved and adopted by the Board of Directors in their Meeting held on February 24, 2023.

The criteria for evaluation have been provided in the Corporate Governance Report, which forms integral part of this Report. Also, the Policy for Evaluation of Performance of the Board of Directors is available on the website of the Company, for reference visit www.etctl.com.

VI. Declaration by Independent Directors

The Independent Directors have submitted their declarations of independence, as required pursuant to the provisions of section 149(7) of the Act, stating that they meet the criteria of independence as provided in section 149[6].

VII. Familiarization Program for Independent Directors

With the commencement of SEBI (LODR) Regulation, 2015 w.e.f. December 2, 2015 the listed entity is required to conduct the program for the new joining director of the company to get him/her familiarized with the company. No new Director joined the Board of the Company during the year under review; hence no such program has been conducted during the FY 2022-23.

VIII. Policies

The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandated the formulation of certain policies for all listed companies. We seek to promote and follow the highest level of ethical standards in all our business transactions. All our corporate governance policies are available on our website (http://etctl.com). The policies are reviewed periodically by the Board and updated based on need and new compliance requirement.

Directors Responsibility Statement

In terms of section 134[3] [c] of the Act, your Directors state that:

i. in the preparation of the annual financial statements for the year ended on March 31, 2023, applicable accounting standards read with requirements set out under schedule III of the Act, have been followed along with proper explanation relating to material departures, if any,

ii. 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 at March 31, 2023 and of the profit of the company for the year ended on that date,

iii. proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for prevention and detection of fraud and other irregularities,

iv. the annual financial statements are prepared on a going concern basis,

v. proper internal financial controls are in place and that the financial controls are adequate and are operating effectively and vi. the systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

Statutory Audit

In accordance with provisions of Section 139(1) of the Companies Act, 2013 M/s. P.S. Thakare & Co., Chartered Accountants, (FRN No. 128572W), has been appointed as statutory auditors of the company for 5 consecutive financial years i.e. from conclusion of 23rd AGM till the conclusion of 28thAGM.

In accordance with provisions of Section 139(1) of the Companies Act, 2013 they have completed 5 consecutive financial years and is eligible to be reappointed for further 5 consecutive financial years i.e. from conclusion of 28th AGM till the conclusion of 33rd AGM.

M/s P.S. Thakare, Peer Reviewed Chartered Accountants, Nagpur, (FRN No. 128572W), has submitted their eligibility and consent under section 141 of the Companies Act, 2013 and the rules made thereunder, to the Board of Directors on August 19, 2023 and are eligible for appointment as Peer Reviewed Statutory Auditors for the FY 2023-24.

Section 139(1) of the Companies Act, 2013, further provides that the appointment of statutory auditors shall be placed before the members for their approval. Accordingly, a resolution seeking members approval for the appointment of M/s. P.S. Thakare & Co., Chartered Accountants, (FRN No. 128572W), as statutory auditors of the company is included at Item No. 3 of the Notice convening the AGM.

In view of the above and on recommendation of Audit Committee, the Board of Directors approves and recommends their appointment as Peer Reviewed Statutory Auditors at the ensuing

Annual General Meeting from the conclusion of the 28th AGM till the conclusion of 33rd AGM and to conduct statutory audit and report thereon from FY 2023-24 till FY 2027-28.

Boards Comment on the Auditors Report

M/s Thakare & Co., Chartered Accountants, has submitted Auditors Report with unmodified opinion and unmodified figures for the F.Y. March 31, 2023 in compliance of Reg. 33 (1) (d) of SEBI (LODR) Regulations, 2015. The Board has duly reviewed the Auditors Report and the Observations and comments, appearing in the Auditors Report are self-explanatory and do not call for any further explanation/ clarification by the Board of Directors as provided under section 134 of the Act.

Secretarial Audit

Pursuant to the provisions of section 204[1] of the Act read with rule 9 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, company is required to annex the Secretarial Audit report with its Board Report. Accordingly, the appointment of M/s H. Roshan & Associates, Nagpur has been made by the Board in their meeting held on August 22, 2023 to conduct Secretarial Audit and report thereon for F.Y. 2022-23. Accordingly, the Secretarial Audit Report given by M/s H. Roshan & Associates, Nagpur for the F.Y. 2022-23 is annexed herewith as "Annexure B". The Board has duly reviewed the Secretarial Auditors Report and the observations and comments, appearing in the report are self- explanatory and do not call for any further explanation/ clarification by the Board of Directors as provided under Section 134 of the Companies Act, 2013.

Details of Fraud Report by Auditor

As per auditors report, no fraud u/s 143(12) of the Companies Act, 2013 reported by the auditor.

Maintenance of Cost Records

In compliance with rule (8) sub-rule (5) clause (ix) of Companies (Accounts) amendment Rules, 2018, the Board of Directors of your company confirms the maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013 is required by the Company and accordingly such accounts and records are made and maintained by the Company.

Business Risk Management

The Company has in place a comprehensive Risk Management framework to identify, monitor, review various risk elements. On a periodic basis all necessary steps towards mitigation of various risk elements which can impact the existence of the Company are taken by the Management of the Company. All the identified risks are managed through continuous review of business parameters by the Management and the Board of Directors are also informed of the risks and concerns.

Discussion on risks and concerns is covered separately under section the Management Discussion and Analysis Report, which forms integral part of this Annual Report.

Vigil Mechanism

The Board of Directors has formulated a Vigil Mechanism/Whistle Blower Policy which provides a robust framework for dealing with genuine concerns and grievances.

Internal Control Systems

The Internal Financial Control systems of the Company are adequate with reference to the Financial Statement, size and operations of the Company. Internal Auditor of the Company observes the effective functioning of internal financial controls. The scope and functions of Internal Auditor is defined and reviewed by the Audit Committee. During the year under review, the Internal Financial Control were tested and no reportable material weakness in the design or operation were observed.

Insider Trading Code

In compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 ("the PIT Regulations") and amendments thereto on prevention of Insider Trading, your Company has a comprehensive Code of Conduct for Regulating, monitoring and reporting of trading by Insiders along with policy on legitimate purpose. Your Company also has a Code of Practices and Procedures of fair disclosures of unpublished price sensitive information and these code(s) are in line with the PIT regulations.

Corporate Social Responsibility

The Annual Report on the CSR activities of the Company, pursuant to Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, is annexed to this report in "Annexure D".

Particulars of Employees

The information required under section 197 of the Act read with Rule 5[1] of the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014 is given in "Annexure E" that forms part of the Boards Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134[3][m] of the Act read with the Companies [Accounts] Rules, 2014, are provided in the Annexure- "F" that forms part of this Report.

Obligation of Company under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 In terms of provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rule (8) sub-rule (5) clause (x) of Companies (accounts) amendment Rules 2018, the Company has formulated a Policy to prevent Sexual Harassment of Women at Workplace and Internal complaint Committee has been constituted for the prevention and redressal of complaints of sexual harassment and to look after the matters connected therewith or incidental thereto.

Significant and Material Orders

There are no significant material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operation.

Acknowledgement