cenlub industries ltd share price Directors report


To the Members,

Your Directors have pleasure in presenting the 31r (Thirty First) Annual Report on the business and operations of the Company together with the audited financial statements for the Financial Year ended March 31,2023.

1. FINANCIAL HIGHLIGHTS

The financial performance of the Company on standalone basis for the Financial Year ended March 31, 2023 as compared to previous year is summarized in the following table:

(Rs. In Lacs)

Standalone
Particulars

2022-23

2021-22
Revenue from Operations 5393.31 5241.90
Other Income 126.62 140.26
Total Income 5519.93 5382.16
Profit before Finance Cost, Depreciation and Tax 1009.54 1017.94
Finance Cost 26.22 58.82
Depreciation 80.21 92.30
Profit Before Tax(PBT) 903.11 866.82
Tax Expenses (Current & Deferred) 236.59 166.44
Profit for the Year 666.53 700.38
Other Comprehensive Income 2.17 -0.84
Total Comprehensive Income 668.69 699.54

FY 2022-23 has been a year of unprecedented challenges and uncertainties, but the Company managed to increase its revenue from operations to 5393.31 Lacs as compared to Rs 5241.90 Lacs in the previous year. The Company earned Profit before tax of Rs. 903.11 Lac against 866.82 earned during last year. However due to higher tax expense, the Net profit after tax during the current year falls slightly to Rs. 666.53 Lacs as against a Net profit after tax of Rs.700.38 Lacs in the previous year.

More details on the financial statements of the Company along with various financial ratios are available in the Management Discussion & Analysis Report forming part of this report.

2. DIVIDEND

Due to amount already borrowed by the company, there is the commitment towards repayments to the leading Banks. The company proposed to repay its debts and proceeds in the directors to become debt free. Due to limited resources available with the company and need to conserve the available resources for the future growth of the company and to repay its existing debts, Board of Directors feels appropriate not to recommend any dividend for the Financial Year 2022-2023.

3. RESERVES

During the year under review, the Company does not propose to transfer any amount to the General Reserve.

4. PERFORMANCE OF THE COMPANY

The financial year 2022-23 saw a complete restoration of economic activity with no major disruptions. Rebound in economic activity coupled with partial easing of supply-side challenges ensured that the automotive industry had a very strong year. Despite continuing inflationary challenges due to the Geopolitical crisis, all the businesses of your Company performed well.

While your Company grew at a swift pace, the balance sheet continues to be sufficiently liquid with Leverage levels remaining in check. Standalone

During the Financial Year ended on 31st March, 2023, your Company has achieved on standalone basis total income from operational turnover of Rs. 5519.93 Lakhs as against Rs. 5382.16 Lakhs in the previous Financial Year and the Profit after Tax is 669.42 Lacs as against Profit after fax of 700.38 Lacs in the previous Financial Year.

5. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013 ("ACT")

Particulars of loans, guarantees and Investments covered under Section 186 of the Act, forms part of notes to the financial statements provided in this Annual Report.

6. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts or arrangements entered into by and between the Company with Related Parties are on arms length basis and in the ordinary course of business.

Pursuant to Section 134 of the Act, read with Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of transactions with related parties are provided in disclosures as per Ind AS 24 have been provided in Note 38 to the financial statements.

7. DEPOSITS

During the year under review, the Company has neither accepted nor renewed any deposits under Chapter V of the Act.

8. INTERNAL FINANCIAL CONTROLS

Your Company has in place adequate internal financial controls, with reference to financial statements, commensurate with size, scale and complexity of its operations. An extensive risk-based Programme of internal audits and management reviews provides assurance to the Board regarding the adequacy and efficacy of internal controls. The internal audit plan is also aligned to the business objectives of the Company which is reviewed and approved by the Audit Committee. Further, the Audit Committee monitors the adequacy and effectiveness of your Companys internal control framework. The internal control system has been designed to ensure that financial and other records are reliable for preparing financial and other statements and for maintaining accountability of assets.

9. RISK MANAGEMENT

The Company has a well-defined process to ensure the risks are identified and mitigation steps are put in place. The Companys Risk Management process focuses on ensuring that these risks are identified on a timely basis and reasonably addressed. The Audit Committee oversees financial risks and controls. Major risks are identified by the businesses and functions and these are systematically addressed through mitigating actions on continuing basis.

10. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no adverse material changes or commitments occurred after March 31, 2023, which may affect the financial position of the Company or may require disclosure.

11. CHANGE IN THE NATURE OF BUSINESS

There Is no change In the nature of business during the financial year 2022-23.

12. SIGNIFICANT AND MATERIAL ORDERS

There are no significant and material orders passed by the regulators or courts or tribunals imparting the going concern status and the Companys operations in the future.

There are no applications made or proceedings pending under the Insolvency and Bankruptcy Code, 2016 as at the end of the financial year, nor has the Company done any one-time settlement with any Bank or Financial institution.

13. STATE OF COMPANYS AFFAIRS

Discussion on state of affairs of the Company has been covered as part of the Management Discussion and Analysis (MDA). MDA for the year under review, as stipulated under Regulation 34 of Listing Regulations, is presented in a separate section forming part of this Annual Report.

14. SHARE CAPITAL

The paid -up Equity Share Capital of the Company as on March 31,2023 stood at Rs. 4,66,28,990.

During the year under review, the Company has not issued any shares with the differential voting rights nor granted any stock options or sweet equity. As on March 31,2023 none of the Directors of the Company hold instruments convertible into equity shares of the Company.

15. TRANSFER OF UNPAID AND UNCLAIMED AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF )

Pursuant to the provisions of the Act and Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), as amended from time-to-tlme, the declared dividends, which remained unpaid or unclaimed for a period of 7 (seven) years and shares in relation to such unpaid / unclaimed dividend shall be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government.

Accordingly, during the year, there was no amount which remains unpaid or unclaimed dividend for a period of 7 (seven) years from trie date they became due for payment along with the shares thereof, to IEPF. The shareholders have an option to claim their shares and/or amount of dividend transferred to IEPF, if any. No claim shall be entertained against the Company for the amounts and shares so transferred during the years.

The details of the nodal officer appointed by the company under the provisions of IEPF is available on the Companys website at http://cenlub.in

The investors may claim their unpaid dividend and the shares from the IEPF Authority by applying in the Form IEPF-5 and complying with the requirements as prescribed.

The list of equity shareholders whose shares are transferred to IEPF can be accessed on the website of the Company at the link: https://www.cenlub.ln.

16. ANNUAL RETURN

In terms of provisions of Section 92(3) and 134(3)(a) of the Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules, the requirement of placing the copy of the annual return In form MGT-7 for the Financial year ended March 31,2022 is available on the website of the company at the link: https:// http://www.cenlub.in/finance/annual-return.pdf and Annual Return for the financial year ended on March, 31 2023 will be available once it get filed with Registrar of Companies.

17. DIRECTORS RESPONSIBILITY STATEMENT

Based on the framework of Internal Financial Controls and compliance systems established and maintained by the Company, the work performed by the Internal Auditors, Statutory Auditors and Secretarial Auditors, including the Audit of Internal Financial Controls over financial reporting by 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 Companys internal financial controls were adequate and effective during the financial year 2022-23.

Pursuant to Section 134(5) of the Act, the Directors confirm that:

a. in preparation of the annual accounts for the financial year ended March 31, 2023, the applicable Accounting Standards have been followed and there were no material departures;

b. they 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 as on March 31,2023, and of the profit of the Company for that period;

c. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. they have prepared the annual accounts on a going concern basis;

e. they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

f. they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

18. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

In terms of the provisions of the Act and the Articles of Association of the Company, Mr. Ansh Mittal (DIN: 00041986), Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible has offered himself for re-appointment. A resolution seeking shareholders approval for his re-appointment along with other required details forms part of the Notice convening the 31 Annual General Meeting ("AGM") of the Company.

During the year under review, there was not change in the Board except the following:

(a) Appointment/Re-Appointment / Change in tenure of Directors

The Shareholders of the Company at the 30 (Thirtieth) Annual General Meeting held on September 20, 2022 approved appointment of below Directors:

1. Re-Appointment of Mr. Aman Mittal (Din:00006435) as Whole Time Director for a term of 3 (three) years w.e.f. 1* August, 2022 till 31st July 2025.

2. Re-Appointment of Mr. Ansh Mittal (Din:00041986) as Whole Time Director for a term of 3 (three) years w.e.f. 1‘ May, 2022 till 30 April 2025.

3. Mr. Tarun Kumar Gupta (DIN: 01581768) for his first term of 5 (five) years starting from 31 December,2022 upto 30" December, 2026;

4. Smt. Santosh Varma was appointed as Non-Executive Independent Directors, for a period of 5 (five) years from T April 2019. Based on the recommendation of the Nomination and Remuneration Committee their re-appointment for a second term of 5(five) years is proposed at the ensuing AGM for the approval of the Members by way special resolution.

The Company has received declaration from the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI(Listing Obligations and Disclosure Requirements) Regulations,2015.

The disclosure pertaining to Directors being appointed/re-appointed as required pursuant to Regulation 36 of the SEBI Listing Regulations given in the explanatory statement to the Notice convening the 31" Annual General Meeting of the Company for reference ol the Shareholders.

(b) Resignation/Retirement of Directors

As per the Retirement Policy for Executive Directors of the Company, Mr. Virendra Kumar Gupta (DIN: 00006461), who is also serving as CFO of the company, has retired from the services of the company as Whole Time Director and CFO of the Company, from the closure of working hours on 31.07.2022. The Board places on record its sincere appreciation of the contribution made by Mr. Virendra Kumar Gupta during their tenure with the Company.

Mr. Ashok Kumar Aggarwal, Independent Director of the Company has resigned from the Directorship of the Company w.e.f. 12.08.2022.

(c) Composition of Board of Directors

As on the date of this Boards Report, l.e. as on August 12, 2023 your Companys Board of Directors comprises of the following Directors:

Name of the Director Director Identification Number(DIN) Category
Ms. Madhu Mittal 00006418 Chairperson 8i Managing Director
Mr. Aman Mittal 00006435 Executive Director
Mr. Ansh Mittal 00041986 Executive Director & CFO
Mr. Dinesh Kaushal 00006490 Non-Executive Independent Director
Ms. Santosh Varma 08441000 Non-Executive Independent Director
Mr. Tarun Kumar Gupta 01581768 Non-Executive Independent Director

(d) Independent Directors Declaration

The Company has received the necessary declarations from each Independent Director in accordance with Section 149(7) of the Act and Regulations 16( 1 )(b) and 25(8) of the Listing Regulations, that he/she meets the criteria of independence as laid out in Section 149(6) of the Act and Regulation 16(l)(b) of the Listing Regulations. In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied of the integrity, expertise, and experience of all Independent Directors on the Board.

19. NUMBER OF MEETINGS OFTHE BOARD

The Board met 4 (four) times during the year. Also, a separate meeting of Independent Directors as prescribed under Schedule IV of the Act, was held during the year under review. The details of meetings of the Board of Directors are provided in the Report of Corporate Governance that forms part of this Annual Report. The Intervening gap between the meetings was within the period prescribed under the Act.

20. BOARD EVALUATION

Led by the Nomination and Remuneration Committee, a formal evaluation of the performance of the Board, its Committees, the Chairperson, and the individual Directors was carried out using Individual questionnaires.

As part of the evaluation process, the performance of Non-Independent Directors, the Chairperson and the Board was conducted by the Independent Directors. The performance evaluation of the respective Committees and that of Independent and Non-Independent Directors was done by the Board excluding the Director being evaluated.

21. FAMILIARISATION PROGRAMME

The Company regularly provides orientation and business overview to its Directors by way of detailed presentations by the various business and functional heads at Board meetings and through other interactive programs. Such meetings/programs include briefings on domestic and global business of the Company. Besides this, the Directors are regularly updated about the Companys new projects, R&D initiatives, changes in the regulatory environment and strategic direction. The Board members are also provided with relevant documents, reports and internal policies to facilitate familiarization with the Companys procedures and practices, from time to time.

The details of the familiarization programs for Independent Directors are posted on the website of the Company and can be accessed at: https://wv.vv. http://vAvw.cenlub.in/finance/familirisation-programme-for-independent-director.pdf.

22. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Provision of Business Responsibility and Sustainability Report does not applicable to the Company.

23. INFORMATION PURSUANT TO RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

In terms of Section 136 of the Act, the Reports and Accounts are being sent to the shareholders excluding the information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Any shareholder interested In obtaining the same may write to the Company Secretary at investors @cenlub.in

The statement containing the information as required under the provisions of Section 197( 12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure "A" and forms part of this Report.

23. NOMINATION AND REMUNERATION POLICY

The Nomination 3rd Remuneration Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall formulate the criteria for appointment of Directors on the Board of the Company and persons holding Senior Management positions in the Company, Including their remuneration and other matters as provided under Section 178 of the Act and Listing Regulations.

The Policy is also available on the Companys website at: http.V/www.cenlub.in/finance/Nomlnation-and-Remunaration-policy.pdf

24. CORPORATE GOVERNANCE

The Company has been practicing the principles of good corporate governance over the years. A separate section on corporate governance and a certificate from the Practicing Company Secretary regarding Compliance with the conditions of corporate governance as stipulated under the Listing Regulations forms part of this Annual Report. The Chairman and Managing Director and the Chief Financial Officer of the Company have certified to the Board on financial statements and other matters in accordance with Regulation 17 (8) of the Listing Regulations pertaining to CEO/CFO certification for the financial year ended March 31,2023.

25. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The company does not have any subsidiary. Joint Venture or Associate Company.

26. AUDIT COMMITTEE

The Audit Comm ittee comprises of following:

1. Mr. Dinesh Kaushal: Independent Director as Chairman

2. Mr. Tarun Kumar Gupta: Independent Director act as Member

3. Mrs. Santosh Varma, Independent Director act as member.

The Audit committee has been re-constituted on 12.08.2022 due to cessation of Mr. Ashok Kumar Agarwal w.e.f. 12.08.2022,

All the recommendations made by the Audit Committee were deliberated and accepted by the Board during the financial year 2022-23.

27. AUDITORS

A. STATUTORY AUDITORS AND AUDIT REPORT

At the 30" Annual General Meeting of the Company held on Tuesday, September 20, 2022, M/s. Singla Tayal & Co., Chartered Accountants (ICAI Firm Registration No. 000882N) were appointed as Statutory Auditors to hold office for a period of 5 (five) consecutive years till the conclusion of 35? Annual General Meeting to be held In the year 2027.

The Auditors Report for the financial year 2022-23 does not contain any qualification, reservation or adverse remark. The Auditors Report is enclosed with the Financial Statements in this Annual Report.

B. SECRETARIAL AUDITOR AND THE AUDIT

As required under Section 204 of the Act and rules thereunder, the Board has appointed Mrs. Apoorva Singh, Company Secretary, to conduct Secretarial Audit for the financial year 2022-23. The Secretarial Audit Report for the financial year ended March 31,2023, is appended as Annexure "C" to this report.

The observations of the Secretarial Auditor in their report are self explanatory and therefore, the Directors do not have any further comments to offer on the same.

C. COST AUDITORS

The Board of Directors, on the recommendation of the Audit Committee, has appointed M/s. Rashmi Smgla, Cost Accountants, Pune, (Firm Registration No.: 00004724) as Cost Auditors to audit the cost accounts of the Company for the financial year 2023-24. As required under the Act, a resolution seeking shareholders approval for the remuneration payable to the Cost Auditors forms part of the Notice convening the 31" Annual General Meeting.

In accordance with the provisions of Section 148(1) of the Act, read with the Companies (Cost Records & Audit) Rules, 2014, the Company has maintained cost records.

D. REPORTING OF FRAUD BY AUDITORS

During the year under review, the Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Act to the Audit Committee.

28. CORPORATE SOCIAL RESPONSIBILITY ACTIVITIES

The Company has been carrying out various Corporate Social Responsibility (CSR) activities. These activities are carried out in terms of Section 135 read with Schedule VII of the Act and the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended from time-to-time.

The brief outline of the Corporate Social Responsibility (CSR) policy of the Company and the initiatives undertaken by the Company on CSR activities during the year under review are set out in Annexure *B" of this report in the format prescribed under Companies (Corporate Social Responsibility Policy) Rules, 2014.

For other details regarding the CSR Committee, please refer to tbe Corporate Governance Report, which forms a part of this report.

29. OBLIGATION OF THE COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL ) ACT, 2013

As per the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,2013, every Company is required to set up an Internal Complaints Committee to look into complaints relating to sexual harassment at work place of any women employee.

The Company had adopted a policy for prevention of Sexual Harassment of Women at workplace and had set up a Committee for implementation of said policy.

As per the provisions of Section 21 8i 22 of the said Act, the Report on the details of the number of cases filed under Sexual Harassment and their disposal for the financial year under review, is as under:

S.No. No. of cases pending as on the beginning of the Financial Year under review No. of complaints filed during the financial year under review No. of cases pending as on the end on the Financial Year under review
1 Nil Nil Nil

The Prevention of Sexual Harassment Policy of the Company can be accessed at http://www.cenlub.ln/flnance/poky-of-prevenbon-of- sexual-harassment-at-work-place.pdf

30. VIGIL MECHANISM

Pursuant to the provisions of Section 177(9) of the Act, read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations and in accordance with the requirements of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Board of Directors had approved the Policy on Vigil Mechanism/Whistle Blower and the same is made available on the website of the Company.

The mechanism under the Policy has been appropriately communicated within the organization. This Policy inter-alia provides a direct access to the Chairman of the Audit Committee.

During the year under review, the Company has not received any complaints under the said mechanism. The Whistle Blower Policy of the Company has been displayed on the Companys website at the link: http://www.cenlub.in/tinance/cil-whistle-blower-policv.pdf.

31. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to the 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 Rule 8 of the Companies (Accounts) Rules, 2014 are appended as Annexure "C" to this report.

32. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company complies with all applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

33. ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the positive co-operation received from the Government of India, Governments of various States in India, Financial Institutions and the Bankers.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, staff of the Company and vendors, customers, Associates and other Professionals , which resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

The Directors express their special thanks to Smt. Madhu Mittal, Chairman and Managing Director, for his untiring efforts for the progress of the Company.

For and on behalf of the Board of Directors
CENLUB INDUSTRIES LIMITED
Date: August, 12 2023 MADHU MITTAL
Place: Faridabad CHAIRPERSON AND MANAGING DIRECTOR
DIN:00006418