To the Members,
Your directors have pleasure in presenting the 33rd Annual Report on the business and operations of Company and the financial accounts for the year ended 31st March 2022.
The financial highlights of your Company, for the year ended 31st March, 2022 are summarized below:
|(Rs in Lakhs)|
|Particulars||31st March 2022||31st March 2021|
|Net Revenue from Operations||26,852.22||18,805.70|
|Profit before Tax and Exceptional Items||753.32||(209.46)|
|Profit before Tax||733.56||(209.46)|
|Profit After Tax||687.65||(283.88)|
|Movement in Retained Earnings|
|Balance Brought Forward||1,331.73||1,628.54|
|Add: Profit after Tax||687.65||(283.88)|
|Add: Other Comprehensive Income||0.46||(12.94)|
|Less: Dividend Tax||0.00||0.00|
|Less: Transfer to General Reserve||0.30||0.00|
|Balance Carried Forward||1,989.84||1,331.73|
COMPANYS PERFORMANCE AND STATE OF THE COMPANYS AFFAIRS
The Company mainly manufactures automobile parts for heavy commercial vehicles as well as passenger vehicles. The Company recorded net revenue from operations of Rs. 26,852.22 Lakhs in FY 2021-22, 42.89% higher than Rs.18,805.70 Lakhs in FY 2020-21. The Profit Before Tax for FY 2021-22 was Rs. 733.56 Lakhs as compared to Loss Before Tax of Rs. 209.46 Lakhs for FY 2020-21. The Profit After Tax for FY 2021-22 was Rs. 687.65 Lakhs as compared to Loss After Tax of Rs. 283.88 Lakhs for FY 2020-21.
The Board of Directors have recommended a dividend of 5% i.e. Rs.0.25/- per share (Previous Year Nil) on 1,07,88,010 equity shares of Rs. 5/- each for the year ended 31st March, 2022. The dividend on equity shares, if approved by the Members would involve a total outflow of Rs. 26.97 Lakhs (Previous Year Nil).
Full version of the Annual Report 2021-22 containing complete Balance Sheet, Statement of Profit & Loss, other statements and notes thereto, prepared as per the requirements of Schedule III to the Companies Act, 2013, Directors Report (including Management Discussion and Analysis, Corporate Governance Report) are being sent via email to all shareholders whos email address are registered with Company.
Full version of Annual Report 2021-22 is also kept open for inspection by any member. The members who wants to inspect the Annual Report, can send an email to email@example.com upto the date of ensuing Annual General Meeting (AGM). The Annual Report is also available at the Companys website at www. akartoolsltd.com.
The paid up equity share capital as on 31st March, 2022 was Rs.5,39,40,050/- divided into 1,07,88,010 equity shares of face value of Rs.5/- each. There was no public issue, rights issue, bonus issue or preferential issue, etc. during the year. The Company has not issued shares with differential voting rights, sweat equity shares, and has not granted any stock options.
TRANSFER TO RESERVES
|(Rs in Lakhs)|
|Particulars||Amount as on 31st March, 2022|
|Balance as per last financial statements||336.97|
|Add: Amount transferred from P&L Account||30.00|
INVESTOR EDUCATION AND PROTECTION FUND
Dividend which was declared by the Company for the year ended 31st March, 2015 at the Annual General Meeting held on 30th September, 2015 and remain unclaimed will be transferred to the Investor Education and Protection Fund (IEPF) of the Central Government pursuant to the provisions of Companies Act, 2013. The last date for claiming the dividend is 29th September, 2022. Thereafter, no claim shall lie on dividend for the year ended 31st March, 2015 from the shareholders.
MCA has notified the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules). Pursuant Section 124(6) of the Companies Act, 2013 read with IEPF Rules as amended, all shares in respect of which dividend has not been paid or claimed for seven consecutive years or more, shall be transferred by the Company to the IEPF.
The Company does not have any subsidiary within the meaning of the Companies Act, 2013.
The rating committee of Infomarics Valuation and Rating Private Limited has assigned a long term credit rating of IVR BB+ (pronounced as IVR Double B plus) and a short term credit rating of IVR A4+ (pronounced as IVR A Four plus) to the line of credit facility enjoyed by the Company. The outlook on the long term and short term rating is stable.
PARTICULARS OF REMUNERATION OF DIRECTORS / KMP / EMPLOYEES
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rules 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached to this Report as ANNEXURE I.
The statements required under Section 197 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (the Rules), as amended, form part of this Report and will be made available to any Member on request, as prescribed therein.
THE CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION, FOREIGN EARNINGS AND OUTGO
Information in accordance with the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is given in ANNEXURE II which forms part of this Report.
In the 28th Annual General Meeting of the Company held on 22nd September, 2017, M/s Jaju and Kabra, Chartered Accountants (Firm Registration No. 140398W), were appointed as the Statutory Auditors of the Company to hold office until the conclusion of the 33rd Annual General Meeting. The term of M/s Jaju and Kabra, Chartered Accountants, as Statutory Auditors, expires at the conclusion of the ensuing annual general meeting.
Board of Directors at its meeting held on 11th August, 2022, based on the recommendation of the Audit Committee has recommended the appointment of M/s. GSA & Associates LLP, Chartered Accountants, Delhi (Firm Registration No.000257N/N500339) as the Statutory Auditors of the Company in place of retiring statutory auditors M/s. Jaju and Kabra.
M/s. GSA & Associates LLP, Chartered Accountants, have consented to the said appointment and confirmed that their appointment, if made, would be within, the limits specified under Section 141(3)(g) of the Act and that they are not disqualified to be appointed as statutory auditors in terms of Section 143 of the Act.
M/s. GSA & Associates LLP, Chartered Accountants, will be appointed as the Statutory Auditors of the Company from the conclusion of the ensuing Annual General Meeting till the conclusion of the 34th Annual General Meeting to be held in the year 2023, on a remuneration, out of pocket expenses etc., incurred in connection with the audit as may be decided by the Board in consultation with the auditors.
The members are therefore requested to appoint M/s. GSA & Associates LLP, Chartered Accountants, as statutory auditors of the Company for a term of 1 (One) year from the conclusion of the ensuing Annual General Meeting till the conclusion of the 34th Annual General Meeting, to be held in 2023.
The Independent Auditors Report, by M/s Jaju and Kabra, Chartered Accountants, for the financial year ended 31st March, 2022 does not contain any adverse remark or reservation and therefore, do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.
As per the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company appointed M/s Nitin S. Sharma & Associates (CP No. 9761), Practising Company Secretaries, Aurangabad to undertake the Secretarial Audit of the Company for the Financial Year 2021-22. The Secretarial Audit Report in Form No MR-3 for the Financial Year 2021-22 is annexed herewith as ANNEXURE III and forms a part of this report. The Secretarial Audit Report does not contain any adverse remark or reservation and therefore, do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.
Pursuant to SEBI Circular dated 8th February, 2019, a report on Secretarial Compliance by M/s Nitin S. Sharma & Associates (CP No. 9761), Practising Company Secretaries, Aurangabad, for the financial year ended 31st March, 2022 has been submitted with the Stock Exchange. The observations made by M/s Nitin S. Sharma & Associates in the said report is as follows:
There was delay in filing intimation regarding notice of Board Meeting held on 13th November 2021. The intimation shall be given at least five days in advance (excluding the date of the intimation and date of the meeting), however, the Company made intimation on 8th November 2021 and paid requisite penalty to BSE Ltd.
Companys response to the observation: The concerned staff responsible for giving the intimation to stock exchange was not available due to some personal emergency. This led to a delay of one day in filing the required intimation. The company has taken requisite measures by assigning the duty of doing timely compliance of such statutory obligations to the alternate staff in case of non-availability of concerned staff.
As per the provisions of Section 148 (3) of the Companies Act, 2013, the Board of Directors of the Company had appointed M/s B R Chandak & Co. (Registration No. 21959), as Cost Auditors of the Company, for conducting the audit of cost records for the financial year ended 31st March 2022. The Cost Auditor has submitted its report for the financial year 2021-22 to the Board of Directors and the same has been approved by the Board of Directors in their meeting held on 11th August, 2022. A proposal for ratification of remuneration of the Cost Auditors for the financial year 2022-23 is placed before the shareholders for ratification / approval.
ADEQUACY OF INTERNAL FINANCIAL CONTROL SYSTEM
According to Section 134(5)(e) of the Companies Act, 2013, the term Internal Financial Control (IFC) means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information.
Rule 8(5)(viii) of Companies (Accounts) Rules, 2014 requires the information regarding adequacy of Internal Financial Controls with reference to the financial statements to be disclosed in the Boards report. The Company has a well placed, proper and adequate IFC system which ensures that all assets are safeguarded and protected and that the transactions are authorised, recorded and reported correctly. The Internal Auditors are an integral part of the internal control system of the Company. To maintain its objective and independence, the Internal Auditors report to the Audit Committee of the Board. The Internal Auditors monitor and evaluate the efficacy and adequacy of internal control systems in the Company.
Demise of Mr. R. L. Gupta:
Mr. Raghunandanlal Gupta, Chairman and Non-Executive Director of the Company demised on 18th May, 2021. Company immensely benefited under the guidance and leadership of Mr. Raghunandanlal Gupta, who was the founder member of the Company. His sudden demise will be an irreparable loss to the Company. The Board placed on record its deep appreciation for the valuable contribution made by him during his tenure as Chairman of the Company.
Mr. Narendrakumar Gupta, has been appointed as the Chairman of the Company, with effect from 10th June, 2021.
Director retiring by rotation:
Mr. Narendrakumar Gupta (holding DIN 00062268) retires by rotation under Section 152 of the Companies Act, 2013 and being eligible, offers himself for reappointment. The brief resume of Mr. Narendrakumar Gupta, the nature of his expertise in specific functional areas, names of the companies in which he has held directorships, committee memberships / chairmanships, his shareholding etc. are furnished in the explanatory statement to the notice of the ensuing AGM.
Declaration by Independent Directors:
Your Company has received declarations from Mr. B. R.
Galgali, Mrs. Bhavna Saboo, Mr. Anil Kumar Gupta and Mr. Ulhas Gaoli, Independent Directors, under provisions of Section 149(7) of the Companies Act, 2013, stating that they meet the criteria of independence as provided under sub-section (6) of Section 149 of the Companies Act, 2013.
KEY Managerial PERSONNEL
The Key Managerial Personnel (KMP) of the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:
|Mr. Sunil Todi||Managing Director|
|Mr. P. M. Nijampurkar||Whole-time Director|
|Mr. Pawan Gupta||Chief Financial Officer|
|Mr. Mitesh Gadhiya||Company Secretary|
A copy of annual return as provided under Section 92 (3) of the Companies Act, 2013 in the prescribed form, is hosted on the Companys website and can be accessed at https://www.akartoolsltd.com/investor.html.
All the requirements of the Corporate Governance are adhered to both in letter and spirit. All the committees of the Board of Directors meets at regular intervals as required in terms of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. Board of Directors have taken all necessary steps to ensure compliance with all statutory requirements. The Directors and Key Managerial Personnel of your Company have complied with the approved Code of Conduct for Board of Directors and Senior Executives of the Company.
The report on Corporate Governance as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this report and is annexed as ANNEXURE IV.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEE MEETINGS
The details regarding the number of meetings of the Board of Directors and Committee meetings during the period under review is given in the Corporate Governance Report.
PERFORMANCE EvALUATION OF THE BOARD, ITS COMMITTEES AND INDIvIDUAL DIRECTORS
Pursuant to applicable provisions of the Companies Act, 2013 and the Listing Regulations 2015, the Board,
in consultation with its Nomination & Remuneration Committee, has formulated a framework containing, inter-alia, the criteria for performance evaluation of the entire Board of the Company, its Committees and Individual Directors, including Independent Directors. The detailed information in this regard has been given in the Corporate Governance Report.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed report on the Management Discussion and analysis is annexed as ANNEXURE V and forms part of this report.
WHISTLE BLOWER POLICY / VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES
Pursuant to the provisions of Section 177(9) and (10) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, the Company has in place whistle blower policy / vigil mechanism for Directors and employees of the Company.
The whistle blower policy / vigil mechanism provides a route for directors and employees to report, without fear of victimisation, any unethical behaviour, suspected or actual fraud, violation of the Companys code of conduct and instances of leak of unpublished price sensitive information, which are detrimental to the organisations interest. The mechanism protects whistle blower from any kind of discrimination, harassment, victimisation or any other unfair employment practice.
The Policy is placed on the Companys website and can be accessed at https://www.akartoolsltd.com/investor/ policies.html.
NOMINATION AND REMUNERATION POLICY
Pursuant to the requirement under Section 134(3) (e) and Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Committee of the Board of Directors has in place a policy which deals with the manner of selection of Board of Directors and Managing Director and their remuneration. The objectives and key features of this policy are:
(a) Formulation of the criteria for determining qualifications, positive attributes of directors, Key Managerial Personnel (KMP) and senior management personnel and also independence of Independent Directors;
(b) Aligning the remuneration of Directors, KMPs and senior management personnel with the Companys financial position, remuneration paid by its industry peers etc.;
(c) Performance evaluation of the Board, its committees and Directors including Independent Directors;
(d) Ensuring Board diversity;
(e) Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down; and
(f) Directors induction and continued training.
The Nomination and Remuneration policy of the Company is available on Companys website and can be accessed at https://www.akartoolsltd.com/investor/policies.html.
RELATED PARTY TRANSACTIONS
All related party transactions those were entered during the financial year were in the ordinary course of business and on arms length basis. All related party transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is also obtained from the Audit Committee for the related party transactions which are of repetitive nature and which can be foreseen and accordingly the required disclosures are made to the Audit Committee on quarterly basis in terms of the omnibus approval of the Committee.
Since all the related party transactions entered into by the Company were in ordinary course of business and were on an arms length basis during the period under review, therefore Section 188 (1) of Companies Act, 2013 is not applicable to the said related party transactions. Thus the Company is not required to prepare Form AOC-2.
The policy on materiality of related party transactions and also on dealing with related party transactions as approved by the Audit Committee and the Board of Directors is uploaded on the web-site of the Company "www.akartoolsltd.com" under the tab "Policies".
PARTICULARS OF LOANS, GUARANTEES OR investments UNDER SECTION 186 OF THE COMPANIES ACT, 2013
There is no loan given or guarantee provided or security provided or investment made by the Company during the financial year 2021-22 as per Section 186 of the Companies Act, 2013.
DEMATERIALISATION OF SHARES
The shares of your Company are being traded in electronic form and the Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the numerous advantages offered by the Depository system, Members are requested to avail the facility of dematerialization of shares with either of the Depositories as aforesaid. As on 31st March, 2022, 98.73% of the share capital stands dematerialized.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The net profit of the Company for the FY 2018-19 was above Rupees Five Crore, therefore, the provisions of Section 135 of the Companies Act, 2013 and rules related thereto, relating to Corporate Social Responsibility, are applicable to the company for the period under review.
The annual report on CSR activities is annexed to this report as ANNEXURE VI. The CSR Policy is available on Companys website and can be accessed at https://www. akartoolsltd.com/investor/policies.html.
DISCLOSURE ON AUDIT COMMITTEE
The Audit Committee as on March 31, 2022 comprises of the following Directors:
i. Mrs. Bhavna Saboo (Chairperson)
ii. Mr. B. R. Galgali (Member)
iii. Mr. Sunil Todi (Member)
All the recommendations of the Audit Committee were accepted by the Board of Directors.
RISK ASSESSMENT AND MANAGEMENT
Your company is exposed to various business risks. These risks are driven through external factors like economic environment, competition, regulations etc. The Company has laid down a well defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process. A detailed exercise is being carried out to identify, evaluate, manage and monitor business and non-business risks. The Audit Committee and Board periodically review the risks and suggest steps to be taken to manage/mitigate the same through a properly defined framework.
During the year, a risk analysis and assessment was conducted and no major risks were noticed, which may threaten the existence of the Company.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 134 (3) (c) of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that:
(a) in the preparation of the annual financial statements for the year ended 31st March 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) the Directors have, in consultation with Statutory Auditors, selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the net profit of the Company for the financial year ended 31st March 2022;
(c) the Directors have taken proper and sufficient care to maintain adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and 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;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down adequate internal financial controls to be followed by the Company and such internal financial controls were operating effectively during the financial year ended 31st March 2022; and
(f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems were adequate and operating effectively throughout the financial year ended 31st March 2022.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143 (12) OF COMPANIES ACT, 2013
During the financial year ended 31st March 2022, there were no frauds reported by the auditors to the Audit Committee or the Board under Section 143 (12) of the Companies Act, 2013.
Your Company has not accepted any deposits under Chapter V of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014, during the period under review.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Board of Directors affirms that the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India i.e. Secretarial Standard-1 (SS-1) on the meetings of Board of Directors and Secretarial Standard-2 (SS-2) on General Meetings read with MCA circulars and SEBI Circulars issued in this regard.
MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes or commitments affecting the financial position of the Company, which have occurred between the end of the financial year and the date of this report.
The details of contingent liabilities are given in Note No. 31 of the Notes to Financial Statements.
NATURE OF BUSINESS
There has been no change in the nature of business of the Company.
FAMILIARISATION PROGRAMMES FOR INDEPENDENT DIRECTORS
To familiarise Independent Directors with the Companys operations, as required under Regulation 25(7) of the SEBI Listing Regulations, the Company has held various programmes for the Independent Directors during the period under review.
The details of such familiarisation programmes is available on the website of the Company www.akartoolsltd.com under the head Board of Directors under Familiarisation Programme.
Your Company believes in engaging human resources as they are the key differentiator for the success of the Company. Keeping the employees engaged and committed can go a long way in attainment of objectives and ensuring sustained business performance. In line with this, your Company has initiated several interventions that will enhance the engagement of the employees. Being a people centric organisation, your Company recognises the significance of building next generation leadership by developing internal talent to meet the organisational objectives. Through this, the human resources function continues to align its strategic interventions and processes, while simultaneously addressing the needs of multiple stakeholders and maintaining a competitive employee cost. Your Company continues to have cordial and harmonious industrial relations across all the manufacturing units. The total number of employees of the Company as on March 31, 2022 stood at 376.
OCCUPATIONAL HEALTH, SAFETY, ENVIRONMENT AND INDUSTRIAL RELATIONS
Your Company has effectively deployed policies on Safety, Occupational Health & Environment at all locations. It continually focuses on improving the effectiveness of system processes, through globally accepted standards. Your Company develop and manufacture products that are safe, eco-friendly and economical. Your Company reviews its processes and its behaviour on a regular basis and measures its effect on peoples health and on the nature.
During the year the Company had cordial relations with workers, staff and officers. The shop floor management is done through personal touch, using various motivational tools and meeting their training needs requirements. The Company has taken initiative for safety of employees and implemented regular safety, imparted machine safety training, wearing protective equipment etc.
Your Companys shares continue to be listed on BSE Limited and are actively traded. The listing fee to BSE Limited for the year 2022-23 has been paid by your Company.
POLICY AGAINST SEXUAL HARASSMENT AT WORKPLACE
Pursuant to the provisions of Section 4(1) of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has in place an Internal Complaints Committee. The following is a summary of sexual harassment complaints received and disposed off during the year:
No. of complaints received: Nil No. of complaints disposed off: NA
CODE OF CONDUCT
Directors, Key Managerial Personnel and Senior Management of the Company have confirmed compliance with the Code of Conduct applicable to the Directors and employees of the Company. The Code of Conduct is available on the Companys Website and can be accessed at https://www.akartoolsltd.com/investor/policies.html.
POLICY FOR PRESERVATION OF DOCUMENTS AND ARCHIVAL POLICY
In compliance with Regulation 9 of Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015, as amended from time to time, the Company has in place the policy for preservation of document and archival policy.
LOAN FROM DIRECTORS
The Company has not received any loan from any Director of the Company during the financial year 2021-22.
Your Directors are pleased to express their gratitude for all the co-operation and assistance received from bankers, members, customers, vendors, various Government authorities and employees for their support and faith in the Company.
|By order of the Board of Directors|
|Date: 11th August, 2022||N K Gupta|