Frontier Springs Ltd Directors Report.

Dear Shareholders,

Your Directors have pleasure in presenting the Fortieth Annual Report of the Company together with the Audited Statement of Accounts the for the year ended 31st March, 2020.

Financial results

The summarized financial results of the Company for the year ended 31st March, 2020 as compared to the preceding year are as under:

(Rs. in Lacs)
Particulars 2019-20 2018-19
Income from Operations/ Turnover 10,077.73 8,383.67
Profit Before Interest, Depreciation and Tax 2,060.52 1,334.92
Interest 64.92 83.15
Depreciation 239.37 221.58
Profit Before Tax 1,756.23 1,030.19
Income Tax :
Current year Tax 309.90 227.07
Deferred Tax 42.27 (37.16)
Net Profit 1,404.06 840.28
Other Comprehensive Income (after Tax) (1.32) 11.16
Total Comprehensive Income for the period 1,402.74 851.44
Proposed Dividend 43.32 39.38
Dividend Distribution tax paid 0.00 6.82
Dividend Distribution Tax (F.Y 2018-19) 1.37 0.00
Corporate Social Responsibility Exps. 2.10 0.00
Balance available for appropriation 1,355.95 805.24
Surplus B/F from Previous Year 3,380.32 2,575.08
Transfer to General Reserve 0.00 0.00
Surplus carried to Balance sheet 4736.27 3380.32


The financial statements for the year ended 31st March, 2020 forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.

The year under review had been a landmark in the history of company as it crossed turnover of Rs. 100 crores .The performance has been exceptional as revenue and profits mounted new heights. The operations of the company during the financial year under review improved with turnover of Rs.10,077.73 Lacs as against Rs. 8,383.66 Lacs in preceding year. The net profit during the year was higher at Rs.1,404.06 Lacs as against Rs. 840.28 Lacs in the preceding year.The improvement in the turnover and profitability had been mainly on account of growth in demand, improvement in the operational efficiencies and cost cutting measures.

The performance of the company during the current year continues to be encouraging and barring unforeseen circumstances, your Directors expect your company to achieve better results during the current year as well.


As on 31.03.2020, Your Company has total share Capital of Rs. 3,93,85,110 divided into 3938511 Equity shares of Rs. 10/- each.


Your Directors are pleased to recommend for approval of the members, a dividend of Rs.1.1/- per share (i.e@11%) on Equity Shares of Rs. 10/- each of the Company.


Your company plans to buy to a Six Ton Hammer in this financial year as a result of which we will be able to forge new products which was not possible due to capacity constraints. The installation of this hammer will increase the turnover and profitability of the company in the years to come. We have also signed an agreement with Crescendo Worldwide. Crescendo Worldwide is an International Trade & FDI Generating Organization based in India which has presence in 22+ countries and aims at Supporting SME & Large companies for growing business globally.The orders for manufacturing of Springs/Forging for Linke-Hofmann Busch (LHB) coaches and Electric Locomotives Springs such as WAP- 7 and WAG-9 which were being imported till date by Indian Railways continues manifold. The demand for products developed by the Forging Unit namely Anti Roll Bar, Anti Roll Bar Bracket and Roll Link used in the manufacturing of LHB Coaches continues to rise. The orders in the pipeline are good. We have been approved by Bombardier Inc for supply of Coil Springs for Metro Coaches. Bombardier Inc is engaged in the manufacturing of metro coaches and has its presence worldwide.


The Company has no Subsidiary, Associate and Joint Venture Companies and as such the requirement of furnishing the information relating to the financial position of Subsidiary, Associate and Joint Venture Companies is not applicable.


Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company Shri Neeraj Bhatia (DIN: 00582395), Director of the Company retires from the Board by rotation, at the ensuing Annual General Meeting of the Company and being eligible he has offered himself for re-appointment.

The Board had re-appointed Shri K.L Bhatia, Chairman Cum Managing Director, Shri Kapil Bhatia, Managing Director and Shri Neeraj Bhatia as Whole-time Director of the Company for a further period of five years w.e.f. April 1, 2020; January 5, 2020 and April 1, 2020 respectively and the matter is placed for approval of the shareholders of the Company at the ensuing Annual General Meeting.

Appropriate Resolutions(s) seeking your approval for appointment/re-appointment of the directors are placed in the Notice of ensuing Annual General Meeting.

During the year under review Shri R.N Trivedi, Independent Director of the Company expired on 20.08.2019 and Shri K.P Somkuwar was appointed as an Independent Director with effect from 08.02.2020

Shri K.P Somkuwar has submitted to the Board a declaration that he meets the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.


As per the provisions of Section 203 of the Companies Act, 2013 the following persons were designated as Key Managerial Personnel and there had been no change in KMP during the year under review :

S.No. Name Designation
1) Shri Kapil Bhatia Managing Director
2) Shri Dhruv Bhasin Company Secretary
3) Shri Neeraj Bhatia Chief Financial Officer


The company had received the declarations u/s 149(7) of the Companies Act, 2013 from all Independent Directors that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.


Four meetings of the Board of Directors were held during the year, the details of which are given in the Corporate Governance Report that forms part of this Annual

Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and the SEBI (Listing Obligations & Disclosure Requirements) 2015.


The Board of Directors at its meeting held on 8th February, 2020 has carried out an annual evaluation of its own performance, board committees and individual directors pursuant to provisions of the Act. Performance Evaluation of Independent Directors was done by the entire board, excluding the director being evaluated. The Evaluation Process was conducted through a structured questionnaire prepared after taking into consideration the various aspects laid down under the Nomination and Remuneration Policy of the Company. The Board of Directors expressed satisfaction with the evaluation process.

In a Separate meeting of Independent Directors held on 8th February, 2020, performance of non-independent directors, the Chairman of the Company and the Board as a whole was evaluated taking into account the views of Executive and Non-Executive Directors.


The new Companies Act, 2013 have strengthened the governance regime in the country. Corporate Governance is all about maintaining a valuable relationship and trust with all stakeholders. We consider stakeholders as partners in our success, and we remain committed to maximizing stakeholders value, be it shareholders, employees, suppliers, customers, investors, communities or policy makers. The business conduct can be ethical only when it rests on the six core values of Customer Value, Ownership, Mindset, Respect, Integrity, One Team and Excellence. In line with the requirements of these core values and new law, the Company through its Board and Committees endeavors to strike and deliver the highest governing standards for the benefits of its stakeholders.

As required under Schedule V to the Listing Regulations, a separate section on Corporate Governance together with certificate from M/s P Manghwani & Associates, Practicing Company Secretaries, confirming compliance of the conditions of Corporate Governance, forms an integral part of this report and is annexed as ‘Annex- ure A.


The outbreak of Covid 19 and the full closure of your companys operations from the 22nd of March, 2020 affected the year end performance. However, your company resumed its operations partially on the 24th of April, 2020 gradually ramping up over the last three months and are glad to report that it is now fully operational.


The current policy is to have an appropriate mix of Executive and Independent directors to maintain the independence of the Board, and separate its functions of governance and management. The Company has duly constituted the Nomination and Remuneration Committee of the Board and the committee interalia periodically evaluates:

1. The need for change in composition and size of the Board;

2. Recommend/review remuneration of the Managing Director(s) and Whole-time Director(s) based on their performance.

3. Recommend the policy for remuneration of Directors, KMPs & others senior level employees of the Company and review the same in accordance with the performance of the Company and industry trend.

The Nomination &Remuneration Policy of the Company is available on the website of the Company at the link

Nomination%20and%20%Remuneration%20Policy.pdf There has been no change in the policy during the year under review. We affirm that the remuneration paid to the Directors is as per the terms laid out in the Policy.


(1) statutory auditors

M/s. Sanjeevani Raizada & Co., (FRN:021960) Chartered Accountants, were appointed as Statutory Auditors of the Company at the 37th Annual General Meeting of the Company held on 28.09.2017 who shall hold office till conclusion of the 42nd Annual General Meeting in accordance with the provisions of Companies Act, 2013.

Their appointment was subject to ratification by the members at every Annual General Meeting to be held there after during their tenure of office. However, pursuant to the amendments made to Section 139 of the Companies Act, 2013 by the Companies (Amendment) Act 2017, the requirement of seeking ratification of the Members for the appointment of Statutory Auditors has been withdrawn. The Auditors have confirmed that they are not disqualified from continuing as Statutory Auditors of the Company.


Pursuant to the Rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148 (1) of the Companies Act, 2013 in respect of its products and accordingly such accounts and records are made and maintained M/s. R.M. Bansal & Co., Cost Accountants (Firm Regn. No.:000022), have been appointed as Cost Auditors of the Company to conduct the audit of the Cost Accounts of the Company, for the financial year 2020-21. As required under the Companies Act, 2013, the resolutions seeking Members ratification for the remuneration payable to Cost Auditors forms part of the Notice convening the Annual General Meeting.


Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed M/s P. Manghwani & Associates, Practicing Company Secretary as Secretarial Auditor of the Company for the year 2019-20. The Secretarial Audit Report for the year ended 31st March, 2020 is annexed herewith as ‘Annexure-B to this report.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.


Pursuant to provisions of Section 138 read with Rule 13 of Companies (Accounts) Rules 2014, your Company engaged the services of M/s J Chandra & Associates, Chartered Accountants, Kanpur, to conduct the Internal Audit of the functions and activities of the Company for the Financial Year 2019-20. The Internal Audit Report is placed before the Audit Committee of the Company, at regular intervals.


The extracts of the Annual Return in Form MGT-9 as required under Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management &Administration) Rules 2014 is included in this report as ‘Annexure-C and forms an integral part of this Report.


There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of the Act and Rules framed there under.


Pursuant to Regulation 34(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), a Management Discussion & Analysis Report is annexed and forms part of this Annual Report.


Information as per Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo for the financial year 2019-20 is annexed as ‘Annexure D which forms part of this Report.


In terms of Section 134(5) of the Companies Act, 2013 the Board of Directors, to the best of their knowledge and ability in respect of the financial year ended on 31st March, 2020 confirm that:

1) in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

2) 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 at the end of the financial year and of the profit of the Company for that period;

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

4) they have prepared the Annual Accounts of the Company on a going concern basis.

5) they 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

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


Your Company is committed to focus on inclusive growth and improving lives by contributing towards communities around which it operates. The CSR Committee of the Board of Directors identifies the areas which require actions to be taken by the Board of Directors. During the year under review the Committee was reconstituted and the composition is disclosed in the detailed report which forms part of this report.

Annual report on CSR as required under rule 8(1) of the Companies (Corporate Social Responsibility) Rules, 2014 is annexed with this report as ‘Annexure E.

The CSR Policy has been uploaded on the Companys website and may be accessed at http:// FSL_Corporate%20Social%20Responsibility%20Policy- .pdf


During the year under review, the Company has neither accepted nor renewed any deposits from public in terms of provisions of Section 73 and 76 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules 2014.

The Company did not accept any unsecured loans from Directors during the year.


None of the employees of the Company was in receipt of renuneration in excess of the limits prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014)


Your Company has not given any loans and guarantees or provided security attracting provisions of Section 186 of the Companies Act, 2013.However the details of investments made are provided in the Note No.2 of the Notes to the Financial Statements for the year ended 31st March, 2020.


The Equity Shares of Company continued to be listed at BSE Limited and the Annual Listing has been paid up-to date.


The Company has in place internal financial control systems, commensurate with the size of the Company and the nature of its business, with reference to financial statements. The Audit Committee of the Board of Directors regularly reviews the adequacy and effectiveness of Internal Control Systems and suggests improvement to strengthen them.

compliance with secreterial standards

During the year under review, the Company has duly complied with the applicable provisions of the Secretarial Standards on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) issued by The Institute of Company Secretaries of India.

composition of audit committee, vigil mechanism & risk management

The composition of Audit Committee is in line with the provisions of Section 177 of the Act read with Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) 2015. The Audit Committee comprises of five members and all members are Independent Directors. The Company Secretary is the Secretary of the Committee. All transactions with related parties are on arms length basis. During the year, there are no instances where the Board had not accepted the recommendations of the Audit Committee. The Company has in place a vigil mechanism for Directors and Employees, to report genuine concerns about any wrongful conduct with respect to the Company or its business or affairs. This policy covers malpractices, misuse or abuse of authority, fraud, violation of the Companys policies or rules, manipulations, negligence causing danger to public health and safety and other matters or activity on account of which the interest of the company is affected or likely to be affected and formally reported by whistle blowers. If an investigation leads the Chairman of the Audit Committee shall recommend to the management of the Company to take such disciplinary or corrective action as he may deem fit.


Risk is an inherent factor in business cycle and cannot be avoided. However, proper planning and checks lead to risk mitigation. The Audit Committee has also been delegated the responsibility for monitoring and reviewing risk management, assessment and minimization procedures, developing, implementing and monitoring the risk management plan and identifying, reviewing and mitigating all elements of risks which the Company may be exposed to. The Board also reviews the risk management, assessment and minimization procedures. Further, in accordance with SEBI Regulations, a Risk Management Committee has also been formed which also oversees the risk management of the company.

The Risk Management Policy has been uploaded on the Companys website and may be accessed at the link


In compliance with the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015 and to preserve the confidentiality and prevent misuse of unpublished price sensitive information, the Company has adopted a Code of Conduct to Regulate, Monitor and Report Trading by Insiders (‘Insider Trading Code) and a Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (Code of Fair Disclosure)

The Insider Trading Code is intended to prevent misuse of unpublished price sensitive information by insiders and connected persons and ensures that the Directors and specified persons of the Company and their dependents shall not derive any benefit or assist others to derive any benefit from access to and possession of price sensitive information about the company which is not in the public domain, that is to say, insider information.

The Code of Fair Disclosure ensures that the affairs of the Company are managed in a fair, transparent and ethical manner keeping in view the needs and interest of all the stakeholders.


Prevention and control of sexual harassment at workplace constitutes an important part of corporate culture while aligning with best practices and improving management processes. The company has zero tolerance for sexual harassment at workplace and has adapted a policy on prevention, prohibition and redressalof sexual harassment at workplace with a mechanism of lodging complaints and has constituted an Internal Complaints Committee in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. No complaints were reported to the Board for sexual harassment of women at work place during the financial year 2019-20.


No material changes and commitments affecting the financial position of the Company occurred from the end of the financial year 2019-20 till the date of this Report. Further, there was no change in the nature of business of the Company.


During the year under review, there were no significant and material orders passed by the Regulators, or Courts or Tribunals which would impact the going concern status of the Company and its future operations.


During the financial year under review, the transactions entered into with related parties were in the ordinary course of business and on an arms length basis and they were placed before the Audit Committee as also to the Board for approval Omnibus approval from the Audit Committee was obtained on Annual basis for transactions of repetitive nature. During the year, the

Company had not entered into any contract, arrange- ment/transaction with related parties which could be considered material in accordance with the Companys related party transaction policy.

Accordingly, the disclosure of Related party transaction as required under Section 134(3)(h) of the Companies Act, 2013 in form AOC-2 is not applicable. The related party transactions are disclosed under Note No.33 of the Notes to the financial statements for the year ended 31st March, 2020.


Your Directors take this opportunity to place on record appreciation for the co-operation and support extended by various departments of the Central and State Governments(s), Bankers and Business associates.

Your Directors also place on record their appreciation for the contribution made by employees at all the levels, Officers, Staff and Workmen. The consistent growth of your Company was made possible by their hard work, cooperation and support. Your Directors also take this opportunity to place on record their gratitude to the Members for their continued support and confidence with the company.

For and on behalf of the Board
Chairman cum Managing
Place : Kanpur Director
Date : 13.08.2020 (DIN No. 00581799)