Investment & Precision Castings Ltd Directors Report.

2018-19

Dear Members,

The Directors have pleasure in presenting their 44th Annual Report and Audited Financial Statements for the year ended 31st March 2019.

1. FINANCIAL MATTERS :

PARTICULARS 2018-19 2017-18
1 Total Income 11,958.98 10,801.00
2 Profit Before Depreaciation & Tax (PBDT) 1,573.08 1,711.26
3 Less : Depreaciation 617.11 513.98
4 Less : Tax (All) (37.04) 403.60
5 Profit After Taxes (PAT) 993.02 793.68
6 Other Comprehensive income (1.75) 1.89
7 Amount available for appropriation 991.27 795.57
8 Appropriations :
(a) Proposed Dividend 100.00 125.00
(b) Corporate Dividend Tax 20.55 25.69
(c) Balance carried forward 870.72 644.88

2. STATE OF COMPANYS AFFAIRS :

The total income for the financial year under review was Rs.11,962.86 Lakhs as against Rs.10,804.41 for the previous year, which is increase of 10.72% in revenue as compare to previous years. The profit before tax for the financial year under review is Rs. 960.57, as against Rs. 1,201.65 for the previous year. The profit after tax for the financial year review was Rs. 997.60 lakhs, as against Rs.798.05 Lakhs for the previous year, registering increasing in profit after tax by 25% as compared to previous year, due to reversal of earlier years tax and deferred tax of previous year into current year.

There are no material changes and commitments which affect the financial position of the Company as on the date of this report since March 31, 2019.

There was no change in the nature of the business during the year under review.

3. DIVIDENDS :

The Directors are pleased to recommend a Dividend for the period ended March 31, 2019 @ Rs. 2/- per share on 50,00,000 Equity Shares (i.e.20%) amounting to Rs.100.00 Lacs for financial year 2018-2019, as against Rs. 2.50 per share, amounting to Rs. 125.00 Lacs for last financial year 2017-2018, subject to approval of the members at this Annual General Meeting.

4. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT,TECHNOLOGY,UPGRADATION/ABSO RPTION, FOREIGN EARNINGS AND OUTGO:

The Companys principle product is "Unmachined and Machined, Ferrous and Non-ferrous alloys Investment Castings". The Government has not classified the said category of product for giving information relating to the Conservation of Energy, Research and Development, Technology Up gradation/Absorption, Foreign Earnings and Outgo.

Information as required to be given under Section 134(3)(m) read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is provided in Annexure A forming part of this Board Report.

5. RESEARCH & DEVELOPMENT :

Product Development and Process Improvements actively continued during the year.

6. WIND POWER PROJECT :

The Companys two Wind Turbine Generators are operating satisfactorily.

7. DIRECTOR AND KEY MANAGERIAL PERSONNEL :

The Details of appointment/re-appointment of the Director:

a) Mrs. Vishakha P. Tamboli (DIN 06600319) retires by rotation as required by the Companies Act, 2013, and being eligible, offers herself for reelection.

b) Mr. Vimal R. Ambani, has been appointed as Independent Director for a period of five years effective from 31.1.2019 subject to approval of the members in this 44th annual general Meeting.

Necessary resolutions relating to Directors who are seeking appointment/reappointment are included in the Notice of Annual General Meeting. The relevant details of the said Directors are given in the Notes/Annexure to the Notice of the Annual General Meeting.

8. DECLARATION FROM INDEPENDENT DIRECTORS :

The Company has received necessary declaration from each Independent Director of the Company under section 149(7) of the Companies Act, 2013 that the Independent Director of the Company meet with the criteria of their Independence laid down in Section 149(6), and also under the Listing Regulations.

9. AUDIT COMMITTEE :

The Audit Committee comprises of Independent Directors namely Mr. Akshay R. Shah (Chairman), Mr. J. M. Mapgaonkar, Mr. Girish C. Shah, Mr. Vimal R. Ambani and Mr. Piyush I. Tamboli as other Members. All the recommendations made by the Audit Committee were accepted by the Board.

10. NOMINATION AND REMUNERATION POLICY OF DIRECTORS :

Policy laid down by the Nomination and

Remuneration Committee for remuneration of Directors, Key Managerial Persons (KMP) and other employees and the criteria formulated by the committee are mentioned in Corporate Governance report as section 178 of the per Companies Act,2013 The information relating to remuneration of the Directors as required under the provisions of Section 197(12) of the Act, is given in Annexure attached.

11. VIGIL MECHANISM / WHISTLEBLOWER POLICY :

The Company has established a Vigil Mechanism and Whistle Blower Policy for its Directors and employees. The said Policy has been communicated to the Directors and employees of the Company and also posted on the website of the Company. For further details, please refer to the Corporate Governance section of this Annual Report.

12. BOARD COMMITTEE :

The Company has constituted the following Committees of the Board of Directors:

• Audit Committee;

• Stakeholders Relationship Committee;

• Corporate Social Responsibility Committee;

• Nomination and Remuneration Committee; and

The Corporate Governance Report contains the details of the composition of each of the above Committees, their respective role and responsibilities.

13. INFORMATION ABOUT THE FINANCIAL PERFORMANCE/FINANCIAL POSITION OF THE SUBSIDIARY :

The summary information on the balance sheet of the subsidiary company is given in this annual report.

14. EXTRACT OF ANNUAL RETURN :

Extract of Annual Return of the Company is annexed herewith as annexure to this report.

15. DIRECTORS RESPONSIBILITY STATEMENT :

Your Directors confirm that,

I. In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

II. The directors 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 ended

31st March 2019 and of the profit of the Company for that period;

III. The directors have taken proper and sufficient care 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;

IV. The directors have prepared the annual accounts on a going concern basis;

V. The Board has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

VI. The directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

16. SECRETARIAL AUDIT REPORT :

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, : The Board has appointed CS Alpesh Dhandhalya, practising company secretary, of M/s. CS Alpesh Dhandhalya & Associates, Companies Secretaries, Ahmedabad, to conduct Secretarial Audit for the financial year 20182019. The Secretarial Audit Report for the financial year ended March 31, 2019 contains observation regarding shares to be transferred to IEPF and notice to be sent to the shareholders.

In this connection, this is to inform that the company had sent individual notice to all concern shareholders whose shares were being transferred to the IEPF and also transferred equity shares into IEPF.

17. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS:

During the year there were no orders passed by the regulators which affected the going concern of the Companys operation, present and future.

18. INTERNAL FINANCIAL CONTROLS :

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

19. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED:

Particulars of loans given, investment made along with the purpose for which the loan is proposed to be utilised by recipient are provided in the standalone financial statement.

20. RISKS MANAGEMENT :

The Management identifies the key risks for the Company, develop and implement the risk mitigation plan, reviews and monitors the risks and corresponding mitigation plans on a regular basis and prioritize the risks, if required depending upon the effect on the business/reputation.

21. CORPORATE SOCIAL RESPONSILIBITY POLICY :

In pursuant to the provisions of section 135 and schedule VII of the Companies Act, 2013, CSR Committee of the Board of Directors was formed to recommend (a) the policy on Corporate Social Responsibility (CSR) and (b) implementation of the CSR Projects or Programs to be undertaken by the Company as per CSR Policy for consideration and approval by the Board of Directors.

From financial year 2018-2019 the Company is now falling under the defined criteria applicable to the company under the Companies Act, 2013 and therefore the Company will undergo spending under the CSR Provisions as applicable, as per the provisions of the act, company has to spent Rs.15.14 lac on CSR activities during year under review. Report on CSR activities is annexed as annexure as part of this report.

22. INSIDER TRADING REGULATIONS:

In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Company has formulated a "Code of Conduct for Prevention of Insider Trading" and "Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information" for regulating, monitoring and reporting of trading in shares of the Company by the Promoters, Designated Persons, Key Managerial Personnel, Directors, Employees, Connected Persons and Insiders of the Company. The said codes are in accordance with the said Regulations and are also available on the website of the Company.

23. CREDIT RATING :

For the Financial Year 2018-19 under review, the credit rating agency "Credit Analysis and Research Limited" has reaffirmed rating of CARE BBB (Triple B; Outlook Stable) assigned to the long term bank facilities and it has reaffirmed the CARE A3+ (A Three Plus) rating assigned to short term facilities.

24. RELATED PARTY TRANSACTIONS :

As per the related party transactions pursuant to section 134(3)(h) of the Act read with Rule 8(2) of Companies(Accounts) Rules,2014, All contracts/arrangements/transactions entered during the financial year with related parties were in the ordinary course of the business and on arms length basis. During the year, the company had not entered into any contract/arrangement/transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

25. COST AUDIT :

Your company carries out an audit of cost records relating to the principle product of the Company viz. "Unmachined and Machined, Ferrous and Nonferrous alloys Investment Castings" according to the requirement of the Central Government and pursuant to Section 148 of the Companies Act, 2013 as amended. Your company has proposed to appoint M/s. Parmaar Rajani & Associates, Cost Accountants (FRN 000414) Bhavnagar, subject to approval of the members in this meeting, as the Cost Auditors to audit the cost accounts of the Company for the Financial Year 2019-2020. The Cost audit is presently applicable to the company according to the revised guideline for limit of turnover for cost audit under the Companies Act, 2013 as amended.

26. LISTING WITH STOCK EXCHANGES :

The Company is listed on The Bombay Stock Exchange Ltd. (BSE) since 1976. The company has paid listing fees to BSE for 2019-2020.

27. CORPORATE GOVERNANCE :

The Company is committed to good corporate governance practices. The Report on Corporate Governance, as stipulated under Listing Regulations, forms an integral part of this Annual Report.

28. SEGMENT REPORTING :

The company has, in accordance with the Indian Accounting Standard (Ind AS) 108- Operating Segments, Identified Investment Activity and Power Generation Activities as its segments.

29. COMPLIANCE WITH SECRETARIAL STANDARDS :

The Company has complied with all the requisite standards, norms and regulations as issued and notified from time to time by The Institute of Companies Secretaries of India, and as prescribed by the Central Government.

30. ACCOUNTING FOR TAXES ON INCOME :

Deferred Tax Asset of Rs. 86.70 Lacs has been credited to the amount available for appropriation for the current Financial Year, 2018-2019.

31. MANAGEMENT DISCUSSION & ANALYSIS :

Management Discussion and Analysis Report for the year under review, as required under Listing Regulations, is enclosed, as part of this report.

32. QUALITY :

Your Company has a dedicated and efficient Quality Assurance ("QA") team is monitoring product quality. The teams also look after all the audit of various Quality System related certificates and adheres and implement the requirement of audit conducted by the auditors of various certificate.

33. INSURANCE :

All the assets of the Company, viz. Buildings, plant and machineries, Stocks, etc. are adequately insured and the insurance is renewed from time to time as per the due dates during the year.

34. HUMAN RESOURCES :

The year under review saw, progress in people practices, as the Company continued on its journey of excellence in people management policies and processes, as your company considers its employees as most valuable assets of the company, and it is known that, without good employees, even the best of companies, ideas and growth will fail, hence for continues development of the same, company on frequent intervals organises various training program for learning latest developments and skills. Improving employees efficiency and performance has always been top priority for the company, as its the "human assets" are the prime facie assets of the company, results of which adds to the valuable goodwill of the company ,as your company is made up of, all skilled and professionally devoted employees, who work hard always for the company. The Company also aims to align human resource practices with its business goals. The performance management system enables a holistic approach to the issue of managing performance and does not limit to only an appraisal. The total number of permanent employees on the rolls of the Company is 218 on March 31, 2019.

35. FORMAL ANNUAL EVALUATION :

The Board of Directors has carried out as annual evaluation of its own performance, its committees and individual Directors pursuant to the requirements of the Act and the Listing Regulations. Further, the Independent Directors, at their exclusive meetings held on 24.5.2018 reviewed the performance of the Board, its Chairman and NonExecutive Directors and other items as stipulated under the Listing Regulations.

36. SEXUAL HARASSMENT POLICY :

The Company has in place a Zero tolerance AntiSexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

37. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS:

In compliance with the requirements of the Listing Regulations, the Independent Directors have been familiarized about the Company by the functional heads of various departments of the Company which includes detailed presentations on the vision and mission of the Company, its operations, business plans, technologies and also future outlook of the entire industry.

38. GENERAL :

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

I. Details relating to deposits covered under Chapter V of the Companies Act, 2013

II. No significant or material orders were passed by the Regulations or Courts or Tribunals which impact the going concern status and Companys operations in future

III. Your Directors further state that during the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

39. ACKNOWLDGEMENT :

Your Directors wish to place on record their appreciation of the contribution made by employees at all levels to the continued growth and prosperity of your Company. Your Directors also wish to place on record their appreciation to the shareholders, dealers, distributors, consumers, banks and other financial institutions for their continued support.

By order of the Board of Directors,
For INVESTMENT PRECISION & CASTINGS LIMITED
Bhavnagar MR.PIYUSH I. TAMBOLI
April 29, 2019 Chairman & Managing Director