affordable robotic & automation ltd share price Management discussions

OVERVIEW

Affordable Robotic & Automation Ltd. (ARAL/ARAPL) is a Pune, India based Robotic Automation Solution Company

Company operates in following business

Robotic automation in Automobile sector and non-automotive sectors such as general industries & Government sector; &

Robotic automation in Car Parking Facility

Incorporated in 2010 under Companies Act, 1956 (Started in the year 2005 as Proprietorship)

Workspace 120000 Sq. ft.

Employee 328+

Turnover (for March 2023) INR 113.16 Cr.

Our Company was originally incorporated as "Affordable Robotic & Automation Private Limited" (ARAPL) at Pune, Maharashtra as a Private Limited Company under the provisions of the Companies Act, 1956 vide Certificate of Incorporation dated 12/01/2010, bearing Corporate Identification Number U29299PN2010PTC135298 issued by Registrar of Companies, Pune, Maharashtra. Subsequently, our Company was converted into a Public Limited Company pursuant to a Shareholders resolution passed at the Extra-ordinary General Meeting of the Company held on January 24, 2018 and the name of our Company was changed to "Affordable Robotic & Automation Limited" vide a fresh Certificate of Incorporation dated February 2, 2018 issued by the Registrar of Companies, Pune, Maharashtra. The Corporate Identification Number of our Company is U29299PN2010PLC135298. And subsequently get listed with BSE SME Platform in the month of June, 2018. After getting listed with BSE SME Platform, the Corporate Identification Number of our Company change to L29299PN2010PLC135298.

The business which was started in year 2005 as a proprietorship concern is in the business of providing turnkey automation solution to automotive, semi-automotive and manufacturing industries. The Company programs and automates the functions of machines used in manufacturing process of automobile industry. The Assembly facility of the Company is situated at Pune, Maharashtra along with the Head office, covering an area of 8,442 sq. meters. The assembly unit is equipped with requisite software, technology, machinery, spares store and other basic amenities for its employees making itself an integrated facility. Our Company is also in the business of assembling and installing automatic multilevel car parking system. This system is preferred by residential complexes, shopping malls, commercial buildings and public sector especially in Smart City projects of various Smart Cities Projects in the Country. Our customers are in Pan-India.

Company is promoted by Mr. Manohar Padole and Mr. Milind Padole. Our individual promoters manage and control the day-to-day affairs of our business operations. Under the leadership of Mr. Milind Padole, Managing Director of our Company has seen remarkable growth in its operational performance. The experience of our promoters and management team is also further reflected in its strong business and financial performance of the Company condition. Our trained and professional experts are inter alia involved in: engineering & design; controls & automation; process study; robotic application; robotic simulation; offline programming; ergonomic study; layout presentation; assembly; material handling design; bulk storage system design; project management; quality and certification; finance & procurement; HR & administration; spares & service support; and training.

Our Company operates on certain core values which are enshrined in the table below. This core value ensures that the Company achieves its end objective without compromising on the quality of the products of the Company.

Further, our Company specializes in analyzing the process which is followed in its manufacturing activity and thereby strives to provide quality automation solution to increase the productivity and clients satisfaction. The Company has an in-house team with technical expertise who does the required programming by using advanced software. Our Company operates with a customer centric approach whereby our Company focuses on continuous training of team which helps us to be innovative and provide quality solution to our customers. We strive to provide the automation solution which is defect free and highly productive. Our customers in automation business are mostly Automobile industries who use our automation solution in their manufacturing processes. Apart from providing automation solutions, we also manufacture Special Purpose Machine (SPM) asper the requirement of our customers. Foreseeing the growth in car-parking business, our Companyby using its automation business expertise has ventured into automated car parking segment which has allowed the Company to gain renowned clients. We are providing various types of highlyautomated type of parking to our customers suitable to their needs. Company is doing lot of research in various other AI like Vision; Conversation AI & Navigation AI. Future products will have lot of these AIs inbuilt.

VISION

To be leader in Robotics & Automation globally, with focus on Innovation, quality, customer satisfaction and deliver sustainable value to all stake holders.

MISSION

To be the most preferred partner for customers by delivering superior experience in projects

Creating smart automation solutions by adopting new technology

Growing profitably by driving competitiveness and operating our business at benchmark levels

Enable employees and associates to achieve and unleash their full potential to deliver sustainable outcomes

Pursue best practices on care for our environment and community.

SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL YEAR

In the opinion of the Board of Directors of our Company, since the date of the last financial statements disclosed, there have not arisen any circumstance that materially or adversely affect or are likely to affect the profitability of our Company or the value of its assets or its ability to pay its material liabilities within the next twelve months, except that affected due to pandemic Covid-19.

The Company has formed ARAPL North America LLC, but any investment is not done till date. "ARAPL North America LLC" is incorporated in United States of America (USA) during the year, but due to pandemic Covid-19 situation "ARAPL North America LLC" not started functioning once the favorable situation will be available, it will start its functioning.

ARAPL Intelligent Equipment Shanghai Co. Ltd (China) subsidiary is under closure procedure, once all legal compliance related to closure once completed, we will intimate about the same.

Masterji.AI Pvt. Ltd is a subsidiary company of Affordable Robotic Automation Ltd, holding 65% of Stake. The Company is incorporated for developing a SaaS based educational robot. This robot will help child achieve their desired academic goals. This will predict expected marks by the child. This is a conversation education SaaS based Robot with multiple AI layers. As Mr. Milind Padole is committed to the ARAPL core business his involvement in this company is limited to the design and logic for building of this Robot.

During the Financial Year 2020-21, there was no resolution passed by Postal Ballot. But in the year 2021-22 company has Approved "AFFORDABLE ROBOTIC AND AUTOMATION LIMITED EMPLOYEE

STOCK OPTION PLAN 2021 ("ESOP 2021"/ "PLAN")" as Special resolution passed by Postal Ballot which will be roll out in the year 2022-23 on the basis of the performance of the employees in the year 2021-22. During the year 2021-22 employees will be assessed on the basis of their performance which result into profit making of the company, and on the basis of the evaluation employees will be decided who will be eligible for ESOP.

"ARAPL RaaS PrivateLimited" was incorporated during the year 2021-22 There is 81.20% stake in subsidiary of ARAPL. This company is building Robots for warehouse automation. These robots will come with 16 layers of AI. It will have Vision; Conversationand Navigation AI built in. The main purpose of this company will be to provide Robot as a Service in which the end customer will pay per transaction on use basis.

FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our results of operations and financial conditions are affected by numerous factors including the following:

Competition from existing and new entrants;

General economic and business conditions;

Changes in laws and regulations that apply to the industry in which operate.

Current Covid-19 pandemic situation.

R&D expenses in the new products.

OVERVIEW OF REVENUE AND EXPENSES

Revenue and Expenses

Our revenue and expenses are reported in the following manner:

Total Revenue

Our Total Revenue comprises of revenue from operations and other income.

Revenue from operations: Our revenue from operations comprises of sale of Jigs & fixtures and revenue by way of charges from sale of services by way of programming and designing the process to be followed by machines/robots used in automobile manufacturing process. It also includes revenue from construction & sale of multi-level parking.

Other Income: Our other income comprises of non-operating recurring income such as interest on term deposits and non-recurring incomes such as written back of sundry balances, foreign exchange gain/loss, interest income on loan & advances made, custom duty draw-back, discount income and misc. income as applicable.

Expenses

Our expenses comprise of cost of material consumed, changes in inventories of work-in-progress and finished goods, employee benefit expenses, finance costs, depreciation and amortization expenses and other expenses.

Cost of material consumed: Cost of material consumed consist of consumption of steel fabrications, metal plates, machined steel components, mechanical, pneumatic, hydraulic parts & accessories, electrical & control material, safety equipment & devices, and robots.

Employee benefit expenses: Our employee benefit expenses include salary and wages, bonus, contribution to provident fund, conservancy charges, professional tax, provision for gratuity, labour welfare expenses, directors remuneration, workmen compensation insurance expenses and contribution to ESIC.

Finance costs: Our finance costs comprise of interest on term loans and working capital facility taken from banks and financial institutions and interest on unsecured loans taken from related parties. Our finance costs also include bank charges on loan and loan processing fees.

Depreciation and amortization expenses: Depreciation and amortization expenses comprise of depreciation on tangible fixed assets and amortization of intangible assets.

Other expenses: Our Other expenses comprise of such as rent & maintenance expenses, designing charges, outside labour charges, GST, electricity charges, insurance charges, site expenses, carriage outward, professional fees and consultancy charges, machinery repair & maintenance, payment to auditors, carriage inward expenses, business development expenses, LPG gas expenses, loading and unloading charges, factory expenses, accounting charges, crane hire charges, DG Set rent expenses, interest on statutory dues, regulatory fees paid to ROC, BSE, conveyance charges, postage & telephone, courier charges, diesel & petrol expenses, donations, office expenses, printing & stationery expenses, travelling expenses, GST audit fees, legal charges, car rent, business tour expenses, payment of statutory dues, sundry balances written off, penalties on statutory dues, advertisement, sales promotion, discount, commission expenses, expenses etc., among others.

OUR FINANCIAL SNAPSHOT

As per Standalone Financial Statements, summary of our financial position is as under:

(Amount in Rs. Lakhs)

Particulars	FY 2022-23	FY 2021-22
Total Revenue	11315.91	8109.75
EBITDA	1007.45	606.03
Profit After Tax	447.79	236.92

OUR PRODUCTS

Sr. No	Product	Description
1.	Industrial Automation	Robotic Welding Automation offerings are Project Management, Supply and Installation of turn-key Robotic Lines, including: Process Study; Ergonomic Study; Layout Preparation; Engineering & Design (Including Material Handling and Bulk Storage System); Assembling; Welding Fixture Manufacturing; Robotic Simulation; Control & Automation; Offline Programming; IOT; Industry 4.0 & Predictive Maintenance Enabled System; Quality & Certification; Training
2.	Multi-level Car Parking	Car Parking Automated Solutions offerings are Stack Parking System (Motorized/Hydraulic); Puzzle Parking System (Over ground/Pit); Tower Parking System / Puzzle Tower Parking System; Mini Rotary Parking System; Horizontal Circulation Parking System; Chess Parking System; AGV Based; Annual Maintenance Contracts (AMC).

FINANCIAL SUMMARY

(Amount in Lakhs)

Particulars	Standalone		Consolidated
	Financial Year 2022-23 (FY23)	Financial Year 2021-22 (FY22)	Financial Year 2022-23 (FY23)	Financial Year 2021-22 (FY22)
Income
Revenue from operations	11,315.91	8,109.75	11,378.68	8,109.75
Other income (net)	21.33	13.53	21.70	13.53
Total income	11,337.24	8123.28	11,400.39	8,123.28
Expenses
Operating expenditure	10598.67	7736.19	10888.03	7736.19
Depreciation and amortization expense	135.85	141.41	141.30	141.41
Total expenses	10,734.52	7877.60	11,029.33	7877.60
Profit before extraordinary items & tax	602.71	245.68	371.06	245.68
extraordinary items	-	-	-	-
Profit before tax (PBT)	602.71	245.68	371.06	245.68
Tax expense	154.93*	8.77*	154.93*	8.77*
Profit for the year	447.79	236.92	216.13	236.92

*Deferred Tax Charges (Revenue)

SHARE CAPITAL

At present, the Authorised Share Capital of your company as on the date of this report is Rs. 12,00,00,000/- (Twelve Crores Only) consisting of 1,20,00,000 Equity Shares of Rs. 10/- (Ten) each. The Issued, Subscribed, Called up and paid up Share Capital of your Company is Rs. 10,17,96,000/- (Ten Crores Seventeen Lakhs Ninety-six Thousand only) consisting of 1,01,79,600 Equity Shares of Rs. 10/-(Ten) each fully paid up. All paid up share capital of the company is in the dematerialised form.

OTHER EQUITY

The other Equity as at March 31, 2023 stood at Rs. 4,256.54 Lakhs as against Rs. 3,808.75 Lakhs as at March 31, 2022 respectively, showing increase. The details of Other Equity are as below:

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
General Reserve	-	-
Share Premium Account	2523.13	2523.13
Retained Profit / (Loss)	1,733.41	1285.63
Total	4,256.54	3,808.75

NON-CURRENT ASSETS (OTHER THAN NON-CURRENT FINANCIAL ASSETS)

The Non-current assets (other than non-current financial assets) as at March 31, 2023 stood at Rs. 2819.90 Lakhs as against Rs. 2775.74 Lakhs as at March 31, 2022 respectively. The details areas below:

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Tangible Assets	1,225.02	1282.16
Intangible Assets	14.57	13.38
Capital Work-in-progress	1,575.89	1459.74
Intangible Assets under Development	4.43	19.95
Total	2819.90	2775.74

Capital work-in-progress

Capital work-in-progress (Capital WIP) stood at Rs. 1,575.89/- as at March 31, 2023 asagainst Rs. 1459.74 Lakhs as at March 31, 2022.

NON-CURRENT FINANCIAL ASSETS

The non-current financial assets at March 31, 2023 were Rs. 297.00 Lakhs as against Rs. 283.85 Lakhs at March 31, 2022. The details of non-current financial assets are as follows:

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Non-current Investments	212.71	212.69
Deferred Tax Assets	3.50	5.38
Long term loans and Advances	80.79	65.78
Total	297.00	283.85

Non-Current Financial Assets-Investments

The total non-current investments as on March 31, 2023 stood at Rs. 212.71/- Lakhs as against Rs. 212.69/- Lakhs as on March 31, 2022. Following are the details of same:

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Dheeyantra Research Labs Pvt Ltd (195 Equity Shares of Rs 10 each at premium of Rs. 20535.75 per share)	40.04	40.04
Masterji.Ai Private Limited (6700 Equity Shares of Rs 10 each share)	0.67	0.65
Shares in Baramati Sah Bank Ltd (37500 Shares of Rs 20 each)	7.50	7.50
ARAPL RaaS Pvt Ltd (19,999 Eq. Shares of Rs 10 each)	2.00	2.00
Flat-Platinum Tirupati Gruh_Mumbai	142.75	142.75
Rajratna Chit Fund Pvt Ltd	4.75	4.75
Aditya Birla Sun Life Mutual Fund_Lien to ABFL	15.00	15.00
	212.71	212.69

ARAPL RaaS Private Limited is a subsidiary company of Affordable Robotic Automation Ltd, holding 83.27% of Stake. The Company is incorporated on October 17, 2021 for carrying on business of godown / Warehouse automation / artificial intelligence (AI).

Non-Current Financial Assets- Long term loans and Advances

The total non-current Long term loans and Advances as on March 31, 2023 stood at Rs. 80.79 Lakhs as against Rs. 65.78 Lakhs March 31, 2022. Details of the Long-term loans and Advances of the Company are as follows.

(Amount in Lakhs)

Long term loans and Advances (Unsecured- Considered Good)	As at March 31, 2023	As at March 31, 2022
a) Loans and Advances to others
Breakerwala & Associates - Supplier	10.00	10.00
b) Capital Advances
Advance for Land- Raj Rane	55.00	55.00
c) Deposits
Deposit for Indian Gas	0.20	0.20
Deposit for Unique Gas	0.24	0.24
Security Depo of Maharashtra Gas Co	0.06	0.06
Deposit-Vandana Bharat gas	0.12	0.12
Security Deposit of Sai Gases	0.06	0.06
Gram panchayat Wadki (Water)	0.10	0.10
Deposit-Balasaheb Sabale (Godown)	15.00	0.00
Deposit-Jay Ambe Agency (Water Jar)	0.01	0.00
Total	80.79	65.78

DEFERRED TAX ASSETS AND DEFERRED TAX LIABILITIES

Deferred Tax Liability

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Balance as per last Balance Sheet	-	-
Less: Current Year Deferred Tax Charge	0	-
Total	0	-

Deferred Tax Asset

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Balance as per last Balance Sheet	5.38	7.66
Less: Current Year Deferred Tax Revenue	1.88	2.29
Total	3.50	5.38

The deferred tax Exp for the current period is of Rs. Rs.1.88 Lakhs has been Debited to the Profit & LossStatement.

(Amount in Lakhs)

Particulars	Deferred Tax (Liability)/ Asset as at 01-04-2022	Current Year Charge	Deferred Tax Asset as at 31-03-2023
Fixed Assets	5.38	1.88	3.50
Total	5.38	1.88	3.50

As a result of Accounting Standard (AS) 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, current year Profit has been decreased by Rs. Rs.1.88/- (Lakh)

CURRENT FINANCIAL ASSETS

The total Current Financial Assets as on March 31, 2023 stood at Rs. 12157.96 Lakhs and Rs. 8498.45 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Current Investments	-	-
Inventories	4,666.93	3,478.52
Trade Receivables	6596.85	4,078.73
Cash and cash equivalents	204.02	226.01
Short term loans & advances	314.75	252.04
Other Current assets	375.41	463.15
Total	12157.96	8498.45

Current Investments

There are no Current Investments made by the Company in any year.

Inventories

The total Inventories as on March 31, 2023 stood at Rs. 4,666.93 Lakhs as against Rs.3,478.52 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Particulars	As at March 31, 2023	As at March 31, 2022
Raw Material, WIP and Stores	4,598.21	3,409.80
Masterji.AI Project WIP	68.72	68.72
Total	4,666.93	3,478.52

Closing stock is taken as valued and certified by the Management.

Trade Receivables

The total Trade Receivables as on March 31, 2023 stood at Rs. 6,596.85 Lakhs as against Rs. 4078.73 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Trade Receivables (Unsecured Considered Good)	As at March 31, 2023	As at March 31, 2022
Outstanding for a period of more than Six months	1,436.26	795.97
Other Debts	5,160.60	3,282.76
Total	6,596.85	4,078.73

Balances of above trade receivables are subject to confirmation and reconciliation, if any.

Cash and cash equivalents

The total Cash and cash equivalents as on March 31, 2023 stood at Rs. 204.02 Lakhs as againstRs.

226.01 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Cash and cash equivalents	As at March 31, 2023	As at March 31, 2022
Cash in Hand	13.05	4.16
Axis Bank Limited (Current Account)	1.69	6.67
Baramati Sahkari Bank-Current Account	1.75	1.75
Aditya Birla Finance Limited_ Lien	187.53	213.42
Total	204.02	226.01

Short term loans & advances

The total Short term loans & advances as on March 31, 2023 stood at Rs. 314.75 Lakhs as againstRs.

252.04 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Short term loans & advances	As at March 31, 2023	As at March 31, 2022
Salary Advance	16.21	20.10
Advance for site expenses	0.00	0.68

 

Loan paid to staff and other	0.26	0.58
Loan to Masterji.ai Pvt Ltd	211.42	115.88
Deposit for Rent	12.09	9.84
2% Vat TDS Receivable	0.00	0.28
Tender EMD	13.00	32.75
TDS and TCS	61.77	71.94
Total	314.75	252.04

Other Current assets

The total Other Current assets as on March 31, 2023 stood at Rs. 375.41 Lakhs as against Rs.

463.15 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Other Current assets	As at March 31, 2023	As at March 31, 2022
Prepaid Expenses	5.61	7.51
Prepaid workmen Comp Insurance	0.29	0.48
Retention Amount-Customer	152.02	158.93
Advance to Suppliers	217.49	296.23
Total	375.41	463.15

REVENUE FROM OPERATIONS (NET)

The Revenue for the year as on March 31, 2023 was Rs. 11315.91 Lakhs as against Rs. 8109.75 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Revenue From Operations	As at March 31, 2023	As at March 31, 2022
Sales- Automation	8,542.67	6,660.60
Sales- Car Parking	4,695.25	2,933.48
Sales- Export	81.88	-
Sales- Scrap	16.18	38.14
Gross Sales	13,335.99	9,632.22
Less: GST	2,019.92	1,520.87
Less: TCS	0.16	1.60
Total	11,315.91	8,109.75

OTHER INCOME

The total other Income for the year as on March 31, 2023 was Rs. 21.33 Lakhs as against Rs.

13.53 Lakhs as on March 31, 2022.

(Amount in Lakhs)

Other Income	As at March 31, 2023	As at March 31, 2022
Interest on Fixed Deposit	7.11	7.89
Unrealised Foreign Exchange Gain	13.45	5.65

 

Misc. Income	0.77	0.00
Total	21.33	13.53

OTHER EXPENSE

The total other Expense for the year as on March 31, 2023 is Rs. 1,250.87 Lakhs as against Rs. 1,037.73 Lakhs in the previous year as at March 31, 2021.

(Amount in Lakhs)

Other Expense	As at March 31, 2023	As at March 31, 2022
A. Manufacturing Expenses	592.32	402.74
B. Office and Administration Cost	510.51	530.21
C. Selling and Distribution Cost	148.04	104.78
Total	1,250.87	1,037.73

PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTIZATION AND EXCEPTIONAL ITEM

During the year, the Company reported Profit before interest, tax, depreciation and amortization and exceptional item of Rs. 1007.45 Lakhs representing an increase over Profit before interest, tax, depreciation and amortization and exceptional item of Rs. 606.03 Lakhs during the previous year.

TAX EXPENSES

The tax expenses for the year amounted to Rs. 153.05 Lakhs as against Rs. 6.48 Lakhs in the previous year. The deferred tax charges (Revenue) for the year was Rs. 1.88 Lakhs against deferred tax charges (Revenue) of Rs. 2.29/- Lakh in the previous year.

The total tax expenses for the year amounted to Rs. 154.93 Lakhs against Rs. 8.77 Lakhs for the previous year.

NET PROFIT AFTER TAX

The Net Profit/(Loss) for the year amounted to Rs. 447.79 Lakhs as against Rs. 236.92 Lakhs as at March 31, 2022.

EARNINGS PER SHARE (EPS)

Basic Earnings per share is calculated by dividing the Net Profit attributable to the Shareholders by the total weighted average number of Equity Shares outstanding at the end of the year.

Basic and Diluted earnings per share are Rs. 4.40/- per share for March 31, 2023 as compared to Rs. 2.23/- per share for March 31, 2022.