Concord Control Director Discussions


To,

The Members,

CONCORD CONTROL SYSTEMS LIMITED

Your Directors have pleasure in presenting the 13th Annual Report on the affairs of the Company together with the Audited Statement of Accounts and the Auditors Report of your Company for the financial year ended on March 31, 2023.

I. FINANCIAL SUMMARY OR HIGHLIGHTS

The Company has recorded the following financial performance, for the year ended March 31, 2023:

[Amount - in Lakhs]

Standalone

Consolidated

Particulars For the year ended March 31, 2023 For the year ended March 31, 2022 For the year ended March 31, 2023 For the year ended March 31, 2022
Revenue 4933.95 3169.02 4935.10 3169.55
Net Profit (Loss) Before Depreciation Interest and Tax 794.90 394.15 795.22 394.22
Less: Depreciation 51.21 37.08 51.21 37.08
Less:Interest 6.46 11.21 6.46 11.21
Net Profit (Loss) Before Tax 737.23 345.86 737.55 345.93
Less: Tax Expenses 192.62 81.68 207.55 81.72
Profit (Loss) After Tax 544.61 264.19 530.00 264.21

II. STATE OF COMPANYS AFFAIRS AND FUTURE OUTLOOK

During the year under review, Revenue from Operations of the Company increased to Rs. 4933.95 lakhs from Rs. 3169.02 lakhs in FY 2021-22 thereby recording an increase of 55.69% and has earned a Net Profit of Rs. 544.61 from Rs. 264.19 in FY 2021-22 thereby recording an increase of 106.16%. Further, your Directors are working hard to analyze prospective products, areas etc to lead the Company towards a better and more promising future.

LISTING OF EQUITY SHARES

Equity shares of your Company were listed on the Bombay Stock Exchange (BSE Limited) on SME Platform on October 10, 2022. The Company got listing approval from BSE Limited (SME Platform) on October 7, 2022. The trading symbol of the Company is CNCRD. Listing fees and the custodian charges to depositories, for the FY 2022-23 have been paid to BSE, NSDL and CDSL respectively.

PUBLIC ISSUE (INITIAL PUBLIC OFFER)

During the year under review, your Company successfully completed its Initial Public Offering (IPO) of 15,12,000 equity shares of face value of Rs.10/- each, at a price of Rs. 55/- per equity share (including a premium of Rs. 45/- per equity share) ("issue price") aggregating Rs. 831.60 lakhs ("the issue") of which 78,000 equity shares aggregating to Rs. 42.90 lakhs was reserved for subscription by market maker. The issue constitutes 26.47% of the post-issue paid up equity share capital of your Company. Your Directors placed on record their appreciation of contributions made by the entire IPO team with all the dedication, diligence and commitment which led to successful listing of the Companys equity shares on the BSE SME platform. Further, the success of the IPO reflects the trust and faith reposed in the Company by the Investors, customers and business partners

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DEMATERIALIZATION OF SHARES

All the Shares of your Company are in Dematerialization mode as on 31st March, 2023. The ISIN of the Equity Shares of your Company is INE0N0J01014.

III. CAPITAL STRUCTURE

As on March 31, 2023, the Authorized Share Capital of the Company is Rs. 10,00,00,000/- (Rupees Ten Crores) divided into 1,00,00,000 (One Crore) Equity Shares of Rs. 10/- each. The Paid Up and Subscribed Equity Share Capital of the Company is Rs. 5,71,20,000/- (Rupees Five Crores Seventy-One Lakh Twenty Thousand only) divided into 57,12,000 (Fifty-Seven Lakhs Twelve Thousand) Equity Shares of Rs. 10/- each.

IV. TRANSFER TO RESERVES

The Board of Directors have not proposed to transfer any amount to any Reserves. Therefore, entire profits of Rs. 544.61 Lakhs earned during the financial year 2022-23 have been retained in profit and loss account for business purposes.

V. DIVIDEND

The Board of Directors do not recommend any dividend for the financial year ended on 31st March, 2023 in order to conserve resources for future development.

VI. INFORMATION ABOUT SUBSIDIARIES/ ASSOCIATE COMPANY/ JOINT VENTURES

The company has Nil Associate Company and Nil Joint Ventures. Further as on the year closing date the company has 2 Subsidiary Companies as detailed below:

S. No. Name of the Company CIN % of Holding Category
1. Drivetrain Solutions Private Limited U31904UP2019PTC124101 66.67% Subsidiary Company
2. Rangetech Systems India Private Limited U36999UP2019PTC124661 99.98% Subsidiary Company

Performance of Subsidiary Companies

During the year under review the Subsidiary Companies have not commenced any major commercial operations. Pursuant to the provisions of section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements which forms part of this Annual Report. A separate statement containing salient features of the financial statements of the Companys Subsidiary in prescribed form AOC-1 is annexed as Annexure 2 to this report.

There was no Company which has ceased to be Companys Subsidiary, Joint Venture or Associate Company during the financial year ended on March 31, 2023.

VII. ANNUAL RETURN

Pursuant to Section 92 (3) read with Section 134(3) (a) of the Act, every Company shall place a copy of the annual return on the website of the Company and the same is placed on the website of the company at https://concordgroup.in/annual-return.php.

VIII. NUMBER OF MEETINGS OF THE BOARD

During the financial year 2022-23, the Board of Directors of the Company met 21 (twenty one) times i.e. on 13th May, 2022, 1st June, 2022, 21st June, 2022, 24th June, 2022, 15th July, 2022, 28th July, 2022, 30th July, 2022, 13th August, 2022, 18th August, 2022, 30th August, 2022, 3rd September,

2022, 6th September, 2022, 8th September, 2022, 9th September, 2022, 17th September, 2022, 19th September, 2022, 26th September, 2022, 30th September, 2022, 6th October, 2022, 14th November, 2022 and 13th March, 2023. The necessary quorum was present for all the meetings. The maximum interval between any two meetings did not exceed 120 days.

The names of the Directors, their attendance at Board Meetings during the year, attendance at the last AGM and the status of attendance of Board Meeting and AGM by each of Director is as follows:

Name of the Director Board Meetings attended during the year Attendance at last AGM
Mr. Gaurav Lath 21/21 1/1
Mr. Nitin Jain 21/21 1/1
Mr. Govind Prasad Lath* 15/15 1/1
Ms. Mahima Jain* 14/15 1/1
Mr. Harsh Sachdev** 01/11 -
Mr. Harsh Yadav** 11/11 1/1
Mr. Sanjeev Mittal*** NA NA

^appointed on the Board w.e.f. July 28, 2022.

**appointed on the Board w.e.f. August 31, 2022. ***appointed on the Board w.e.f. September 02, 2023.

IX. COMMITTEES OF THE BOARD

There are currently three Committees of the Board, viz:

1. Audit Committee;

Name Position in the Committee Designation
Mr. Harsh Yadav Chairman Independent Director
Mr. Harsh Sachdev Member Independent Director
Mrs. Mahima Jain Member Non-Executive Director

2. Nomination & Remuneration Committee;

Name Position in the Committee Designation
Mr. Harsh Yadav Chairman Independent Director
Mr. Harsh Sachdev Member Independent Director
Mrs. Mahima Jain Member Non-Executive Director

3. Stakeholders Relationship Committee;

Name Position in the Committee Designation
Mr. Harsh Yadav Chairman Independent Director
Mr. Gaurav Lath Member Joint Managing Director
Mrs. Mahima Jain Member Non-Executive Director

Details of all the committees along with their charters, composition and meetings held during the year are provided in the "Report on Corporate Governance", a part of this Annual Report.

X. FORMAL ANNUAL EVALUATION OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The formal evaluation mechanism has been adopted for evaluating the performance of the Board as well as its Committees and Individual Directors of the Board.

The exercise was carried out through a structured evaluation process covering various aspects such as composition of the Board & Committees, experience and competencies, performance of specific duties and obligations, attendance and contribution at Board meetings / Committee meetings / General meetings, preparedness for meetings, effective decision making ability, knowledge of sector where Company operates, understanding and avoidance of risk while executing functional duties, successful negotiating ability, initiative to maintain corporate culture, commitment, dedication of time, leadership quality, attitude, initiatives and responsibilities undertaken, achievements etc.

In a separate meeting of Independent Directors held on 13th March, 2023, performance of nonindependent Directors, performance of Board as a whole and performance of the Chairman were evaluated taking into account the views of executive and non-executive Directors. The said meeting was attended by all the Independent Directors.

Further, the Board has expressed its satisfaction and has been thankful to all its Independent Directors for sharing their knowledge and expertise which has been proved beneficial towards the progress of the Company.

(e) The Directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

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

XII. DISCLOSURE REQUIRED UNDER SECTION 134(3)(e)

The Board has adopted a Board Diversity Policy which sets the criterion for appointment as well as continuance of Directors, at the time of reappointment of director in the Company. As per the policy, the Board has an optimum combination of members with appropriate balance of skill, experience, background, gender and other qualities of directors required by the directors for the effective functioning of the Board. The Nomination and Remuneration Committee recommends remuneration of the Directors, subject to overall limits set under the Act, as outlined in the Remuneration Policy.

XIII. AUDITORS AND THEIR REPORTS

a) Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, your Company had appointed M/s Seth & Associates, Chartered Accountants, FRN: 001167C on 29th September, 2022 as Statutory Auditors of the company for a period of five years till the conclusion of Annual General Meeting to be held in year 2027.

The observations, if any, made by the Statutory Auditors in their Report together with the notes to accounts, as append thereto are selfexplanatory and hence does not call for any further explanation. There are no qualifications, reservations or adverse remarks or disclaimers made by M/s Seth & Associates, Statutory Auditors, in their report.

During the Financial Year 2022-23, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under section 134(3)(ca) of the Companies Act, 2013.

Regulation 33(d) of SEBI (LODR) Regulations, 2015 stipulates that in case of audit reports with unmodified opinion(s), the listed entity shall furnish a declaration to that effect to the Stock Exchange(s) while publishing the annual audited financial results. Accordingly, it is hereby confirmed that Statutory Auditors of the Company are Peer Reviewed.

b) Secretarial Auditors

The Company has appointed M/s Amit Gupta &

Associates, Company Secretaries as Secretarial Auditors of the Company in accordance with the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for the Financial Year 2022-23. The report of the Secretarial Auditor MR-3 for the financial year 2022-23 is enclosed as Annexure C to this Boards Report, which is self-explanatory. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

c) Internal Auditors

The Company has appointed M/s. Musheer & Associates, Chartered Accountants, Lucknow (FRN: 021183C) as the Internal Auditors of the Company under the provisions of section 138 of the Act, for conducting the internal audit of the Company for the financial year 2022-23.

d) Cost Audit

The provisions of the Cost Audit were not applicable to the Company during the year under report. The Company has duly maintained cost records in terms of applicable provisions of law.

XIV. REPORTING OF FRAUDS BY AUDITORS

During the year under review, neither the Statutory Auditors nor the Secretarial Auditor have reported to the Audit Committee, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, hence, there is nothing to be mentioned in the Boards report in this regard.

XV. PARTICULARS OF INTER-CORPORATE LOANS & INVESTMENTS

During the financial year 2022-23, the investments made and loans granted by the Company are mentioned under note no. 13, 16 and 14 respectively. Further the Company has not given any guarantee or security to any person or body corporate.

During the year ended 31st March 2023 the particulars of the Loans Given by the company to a firm/company in which the Director is interested is as follows: -

Name of the company Nil
Amount of Loan Nil

The subsidiary of the company has not given any Loan to a firm/company in which the Director is interested.

XVI. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board has a good mix of Executive and NonExecutive Directors including Independent Directors. The Board consists of seven (07) Directors comprising four (04) Non-Executive Directors out of which three (03) are Independent Directors & one (01) Women Non-Executive Director, one (01) Non- Executive Chairman, and two (02) Joint Managing Directors. However, Mr. Sanjeev Mittal has been appointed as an Independent Director w.e.f. September 02, 2023 on the Board of the Company. The composition of the Board represents an optimal mix of professionalism, knowledge and expertise in their respective fields.

Appointments/ Resignations:

During the year under review, the Board of Directors at its Meeting held on 30th August, 2022:

1. appointed Mr. Harsh Sachdev (DIN:09720531) and Mr. Harsh Yadav (DIN:09718679) as an Independent Director of the Company;

2. appointed and redesignated Director Mr. Nitin Jain (DIN:03385362) and Mr. Gaurav Lath (DIN:00581405) as Joint Managing Directors of the Company;

3. had regularized and re-designated Mr. Govind Prasad Lath (DIN:00272007) as Chairperson and NonExecutive Director of the Company;

4. had regularized and re-designated Mrs. Mahima Jain

(DIN:09688771) as Non-Executive Director;

On the basis of representations received from the Directors, none of the Directors of the Company are disqualified as per section 164(2) of the Companies Act, 2013 and rules made thereunder or any other provisions of the Companies Act, 2013. The Directors have also made necessary disclosures as required under provisions of section 184(1) of the Companies Act, 2013. All members of the Board of Directors and senior management personnel affirmed compliance with the Companys Code of Conduct policy for the financial year 2022-23.

In the opinion of the Board, there has been no change in the circumstances which may affect the status of the Independent Directors of the Company and the Board is satisfied about the integrity, expertise, and experience including proficiency in terms of Section 150(1) of the Act and applicable rules thereunder of the Independent Directors on the Board and proposes their re-appointment at the ensuing Annual General Meeting.

Retirement by Rotation

Pursuant to Section 152 of the Companies Act 2013 read with Article 145 of Articles of Association of the Company, Mr. Nitin Jain (DIN: 03385362), Joint Managing Director of the Company is liable to retire by rotation and being eligible has offered himself for reappointment at the ensuing Annual General

Meeting. The Board recommends his reappointment.

Declarations given by Independent Directors under Section 149(6) of the Companies Act, 2013

The Company has received declarations from the Independent Directors of the Company under section 149(7) of the Companies Act, 2013 confirming that they meet the criteria of Independence as provided in Section 149(6) of the Companies Act, 2013 and there has been no change in the circumstances which may affect their status as Independent Directors. Further, they have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs in terms of Section 150 of the Act read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014. During the FY 2022-23 separate meeting exclusively of Independent Directors was held on 13th March,2023.

b) Impact of above measures

The above measures have resulted in environment protection and more efficient utilization of power & reduction in energy consumption has considerably reduced the expenses and cost of production of goods.

c) The steps taken by the company for utilizing alternate source of the energy: NA

II. TECHNOLOGY ABSORPTION

a) The efforts made towards technology absorption

Efforts are being made towards improvements

b) Thebenefitsderivedlikeproductimprovement, cost reduction, product development or import substitution

Improved quality and productivity.

Conservation of fuel & reduced emissions

c) In case of imported technology: NIL

III. FOREIGN EXCHANGE EARNING & OUTGO

Foreign Exchange Earnings NA
Foreign Exchange Used Rs. 2.16 Cr

XIX. RELATED PARTY TRANSACTIONS

During the financial year ended March 31, 2023, all transactions with the Related Parties as defined under section 188 of the Companies Act, 2013 read with Rules framed there-under and Regulation 23 of the Listing Regulations were in the ordinary course of business and at arms length basis.

During the year under review, your Company did not enter into any Related Party Transactions which require prior approval of the Members. All Related Party Transactions of your Company had prior

approval of the Board of Directors, as required under the Companies Act, 2013. Subsequently, the Board has reviewed the Related Party Transactions on a periodic basis. During the year under review, there has been no materially significant Related Party Transactions having potential conflict with the interest of the Company.

Necessary disclosures required under the AS 18 have been made in Note No. 39 of the Notes to the Financial Statements for the year ended March 31, 2023.

I XXI. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL PERIOD OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There have been no material changes and commitments affecting the financial position of the Company, between the end of the financial period of the Company to which the financial statements relate and the date of this report.

XXII.DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (Act) and rules made there under, your Company has adopted a Sexual Harassment Policy for women to ensure healthy working environment without fear of prejudice, gender bias and sexual harassment. The Board states that there were no cases or complaints filed during the year pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the financial year 2022-23, no complaint has been received by the members of the committee. Hence, no complaint is pending at the end of the financial year.

XXIII. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS/ TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

During the year under review there has been no such significant and material orders passed by the Regulators/Courts/Tribunals impacting the going concern status and companys operations in future.

growth and increasing complexity of operations.

XXV. PARTICULARS OF EMPLOYEES AND MANAGERIAL REMUNERATION

The details of Managerial Remuneration, Key Managerial Personnel and employees of the Company as required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been set out as Annexure - B to this Report, attached hereto.

XXVI. CHANGE IN THE NATURE OF BUSINESS

The Company is in the business of manufacturing of electrical and electronic Products for Indian railways and it is doing its regular business without any deviation to other objects.

XXVII. THE DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016) DURING THE YEAR ALONGWITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR.

During the year under review, there were no applications made or proceedings pending in the name of the Company under the Insolvency Bankruptcy Code, 2016.

XXVIII. MANAGEMENT DICSUSSION AND ANALYSIS REPORT

Pursuant to Regulation 34 (2) (e) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015, Management Discussion & Analysis Report for the year under review forms the part of this report and is marked as Annexure - A to this report.

XXIX. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Board of Directors of your Company hereby Confirms that the Provisions of Section 135 (1) of the Companies Act, 2013 and Rule 9 of the Companies (Corporate Social Responsibility Policy) Rules are not applicable to the Company for the Financial Year 2022-23.

XXX. RISK MANAGEMENT

Every business is subject to risks, uncertainties that could cause actual results to differ materially from those contemplated. The Company has in place a mechanism comprising of regular audits and checks to inform the Board members about the Risk assessment and mitigation plans and periodical reviews to ensure that the critical risks are controlled by the management. Major risks identified are systematically addressed through risk mitigation actions on a continuing basis.

XXXI. WHISTLE BLOWER POLICY AND VIGIL MECHANISM

The Company has in place a Whistle Blower Policy

establishing a vigil mechanism, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail such mechanism and also provide for direct access to the Chairman of the Audit Committee. The Policy can be accessed on the website of the Company at https://concordgroup.in/ policies.php.

XXXII. CORPORATE GOVERNANCE

Since the Company is listed on BSE SME, the Company is exempt from applicability of certain regulations pertaining to Corporate Governance under Securities & Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Company has been practicing sound Corporate Governance and takes necessary actions at appropriate times for enhancing and meeting stakeholders expectations while continuing to comply with the mandatory provisions and strive to comply non-mandatory requirements of Corporate Governance.

Report on Corporate Governance Practices and

the Auditors Certificate regarding compliance of conditions of Corporate Governance and certification by CEO/Whole time Director & CFO is not applicable to your Company as per regulation 15(2)(b) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015. However, Corporate Governance Report for the year under review forms part of this report and is marked as Annexure - B to this Report.

XXXIII. DETAILS ON ONE TIME SETTLEMENT

There is nothing to report under this for the year under review.

XXXIV. ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation and sincere gratitude towards all associates including Employees, Customers, Suppliers, Government Agencies, Financial Institutions, Bankers, Shareholders, and others for their valuable support and confidence in the Company during the period under review and look forward to their continued co-operation in the years to come.

Your Directors also acknowledge the support and co-operation received from the employees of the Company and all those who have helped in the day to day management.

For & on behalf of the Board

Concord Control Systems Limited

(formerly known as Concord Control Systems Pvt. Ltd.)

Date: September 02, 2023 Sd/-

Govind Prasad Lath

Chairman & Non-Executive Director

Place: Lucknow DIN:00272007