Today's Top Gainer
Note:Top Gainer - Nifty 50 More
to the Shareholders
Your Directors submit their Forty Fourth Annual Report together with the Audited Balance Sheet as at 31st March, 2018 and the Statement of Profit and Loss for the year ended 31st March, 2018.
Financial Summary / Highlights Rs in Lakhs
|Sales and other income||831.38||801.36|
|Profit before Depreciation and Amortization Expenses||272.08||219.58|
|Depreciation and amortization Expenses||35.99||29.96|
|Add: Exceptional items||-||85.34|
|Less: Tax expense|
|Current Tax||(-) 61.96||(-) 95.77|
|Deferred Tax||(-) 1.24||5.15|
|For earlier years||-||(-) 138.09|
|Net Profit / Loss (-)||174.07||46.83|
|Add: Balance from the Previous year||(-) 742.58||(-) 789.41|
|Balance Carried Over||(-) 568.51||(-) 742.58|
Transition to Indian Accounting Standards
The Company has adopted the Indian Accounting Standards (Ind AS) from April 1, 2017 with a transition date of April 1, 2016 pursuant to the Notification dated 16.02.2015 in the official gazette by the Ministry of Corporate Affairs (MCA) . The following are the areas which had an impact on account of transition to Ind AS
- Investment Property presented separately with the fair values
- 6% Cumulative Redeemable Preference Share Capital considered as borrowing
- Employee Cost pertaining to defined benefit obligation
- Revenue recognition
- Deferred taxes
The reconciliation and description of the effect of the transition from GAAP to Ind AS have been provided in the Notes to Accounts.
The operations during the year have resulted in a net profit of Rs 237.27 lakhs after providing for depreciation of Rs 35.99 lakhs. The net profit after Tax is Rs 174.07 lakhs.
On adoption of Ind AS, the revenue segments of the Company have been reclassified as a) Warehousing Rental Services being the Unit 1 at SIPCOT Industrial Complex, Hosur - 635 126 and b) Other Engineering Services being Unit 2 at Pollachi Road, Coimbatore 642 109.
The Warehousing Rental Services segment consists of Warehousing Rental income on the Land and Buildings at Hosur and the Other Engineering Services segment consists of Manufacture and Sale of Accessories and Spares of Weaving and Knitting Machines and Parts and Accessories for Machine Tools at Pollachi Road, Coimbatore - 642 109.
Warehousing Rental Services
The income generated from Warehousing Rental Services during the year was Rs 458.75 lakhs against Rs 414.06 lakhs in the previous year.
Other Engineering Services
The sale of Accessories and Spares of Weaving Machines during the year was Rs 69.06 lakhs against Rs 113.49 lakhs in the previous year.
The sale of Parts and Accessories for Machine Tools during the year was Rs 194.69 lakhs against Rs 163.81 lakhs in the previous year. The inflow of orders for Parts and Accessories for Machine Tools from an EOU is based on the demand in the international market.
The Companys income mainly consists of Warehousing Rental income on Land and Buildings at Hosur. In view of the demand for Warehousing Space at Hosur, being near to Bangalore, the Company is constructing additional Buildings in the existing land to augment its revenue.
The paid up Equity Share Capital as on March 31, 2018 is Rs 610.40 lakhs. The Company bought back unlisted 2,00,000 - 6% Cumulative Redeemable Preference Shares of Rs 100/- each amounting to Rs 200 lakhs during the year by utilising the Securities Premium Amount. As required under Ind AS the 6% Cumulative Redeemable Preference Share Capital of Rs 400 lakhs is classified under Borrowings in the Balance Sheet as on 31-03-2018.
During the year under review the Company has not issued any shares or any convertible instruments.
The Company has not accepted any deposit from public falling within the ambit of Section 73 of the Companies Act, 2013.
Extract of Annual Return
The Extract of Annual Return pursuant to the provisions of Section 92 of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014 in form MGT-9 is furnished in Annexure 1 forming part of the Boards Report.
Board and its Committees Meetings conducted during the year under review
Five Meetings of the Board of Directors were held on 29.05.2017, 09.08.2017, 25.09.2017, 06.12.2017 and 07.02.2018, during the Financial Year from 1st April, 2017 to 31st March, 2018. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
Details of Attendance of each Director at the Meetings of the Board and various Committees of the Board during the financial year ended 31st March, 2018 are as below:
|Sl. No. Name of Directors||Board Meetings attended||Audit Committee Meetings Attended||Nomination & Remuneration Committee Meetings attended||Stakeholders Relationship Committee Meeting attended||Last AGM Attended (Yes/No)|
|1 Sri S.Pathy||5||-||2||-||Yes|
|2 Sri R.Santharam||4||3||2||1||Yes|
|3 Sri R.C.H.Reddy||5||4||2||1||Yes|
|4 Smt.Aishwarya Pathy||3||-||-||-||Yes|
|5 Sri R.Varadarajan||4||4||1||-||Yes|
|6 Sri C.Kamatchisundaram||5||-||-||-||Yes|
|7 Sri N.Jaychander||4||-||-||-||Yes|
|8 Sri R.R.Balasundharam||5||4||-||-||Yes|
The Independent Audit Committee as below consists of three Independent Directors and one Non-Executive Director as its members. Sri R.C.H.Reddy, Independent Director is the Chairman of the Committee.
|1. Sri R.C.H.Reddy||Chairman||Independent Director|
|2. Sri R.Santharam||Member||Non Executive Director|
|3. Sri R.Varadarajan||Member||Independent Director|
|4. Sri R.R.Balasundharam||Member||Independent Director|
The Company Secretary is the Secretary of the Audit Committee.
Four Committee Meetings were held during the Financial Year ended 31st March, 2018 on 29.05.2017, 09.08.2017, 06.12.2017 and 07.02.2018. The Statutory Auditors, Internal Auditors, the Chief Executive Officer and the Chief Financial Officer attend the Audit Committee Meetings on invitation. The Senior Managerial Personnel attend the meetings as may be required by the Committee.
Nomination and Remuneration Committee
The Committee has been re-constituted as below at the Board Meeting held on 07.02.2018 with four Directors as Members of which two Members are Independent Directors. The Chairman of the Committee Sri R.C.H. Reddy is an Independent Director.
|1. Sri R.C.H.Reddy||Chairman||Independent Director|
|2. Sri R.Santharam||Member||Non Executive Director|
|3. Smt Aishwarya Pathy||Member||Non Executive Director|
|4. Sri R.Varadarajan||Member||Independent Director|
The Committee has met two times during the Financial Year ended 31st March, 2018 on 25.09.2017 and 07.02.2018. The Company Secretary is the Secretary of the Committee.
Nomination and Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Policy for selection and appointment of Directors, Key Managerial Personnel and their remuneration in terms of Section 178(3) of the Companies Act, 2013. The Nomination and Remuneration Policy as approved by the Board is disclosed on the Companys website at the link at : http://www.lakshmiautomatic.com/investors/policies/nomination-and-remuneration-policy/ in terms of the proviso to Section 178(4) of the Companies Act, 2013.
Salient Features of the Policy include:
To lay down criteria and terms and conditions with regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.
To determine remuneration based on the Companys size and financial position and trends and practices on remuneration prevailing in peer Companies, in the manufacturing sector.
To carryout evaluation of the performance of Directors, as well as Key Managerial and Senior Management Personnel.
To compensate them to their effort, performance, dedication and achievement relating to the Companys operations.
To retain, motivate and promote talent and to ensure long term sustainability of talented managerial persons.
To perform such other functions as may be necessary as appropriate for the performance of the Directors.
Annual Performance Evaluation
The Nomination and Remuneration Committee has laid down the criteria and the manner for effective evaluation of the performance of the Board, its Committees and individual Directors for the Financial Year 2017-18. Accordingly a peer evaluation excluding the Director being evaluated was carried out by the Board on 07.02.2018. By a questionnaire circulated, each Board member was requested to give his/her views in evaluation of the Company performance, strategy and the performance of the Board, its Committees and individual Directors. Some of the performance parameters on which the independent Directors were evaluated include contribution, commitment, Initiative, Integrity, Independence, Independent views and judgment, fulfillment of functions, Qualifications, Knowledge, Experience and Competency and Role in active participation in Board and Committee Meetings.
The Independent Directors at their meeting held on 07.02.2018 reviewed the performance of Non-Independent Directors, the Board and the Chairperson of the Company.
The performance of the Key Managerial and Senior Management Personnel of the Company was evaluated based on their qualifications, experience and the duties and responsibilities carried out by them.
Directors Responsibility Statement
Pursuant to the requirement under Section 134(3) (c) of the Companies Act, 2013 the Board of Directors of the Company state that:
i) in the preparation of the annual accounts for the year ended 31st March, 2018, the applicable Accounting Standards have been followed;
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 as at 31st March, 2018 and of the profit of the Company for the year ended 31st March 2018;
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 account for the financial year ended 31st March 2018 on a going concern basis.
v) 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.
vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Declaration by Independent Directors
The Company has received declaration from all the Independent Directors of the Company in terms of Section 149(7) of the Companies Act, 2013 confirming that they meet with the criteria of independence as prescribed under sub Section (6) of Section 149 of the Companies Act, 2013 and Regulations 25 of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.
There are no qualifications, reservations or adverse remarks made by the Statutory Auditors, M/s.Subbachar & Srinivasan, Chartered Accountants, (Membership No.004083S) in the Auditors Report.
The Board has appointed Mr.M.R.L.Narasimha, Practising Company Secretary, (Membership No.2851, CP 799) to conduct Secretarial Audit for the Financial Year 2017-18. The Secretarial Audit Report for the Financial Year ended March 31, 2018 is annexed to this Report (Annexure 2) . The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
Particulars of Loans, Guarantees or Investments
The Company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013.
Related Party Transactions:
All Related Party Transactions entered into during the Financial Year were on arms length basis and were in the ordinary course of the business. There are no materially significant Related Party Transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with the interest of the Company at large. Hence Form AOC - 2 pursuant to Section 134(3) (h) of the Companies Act, 2013 read with Rule 8 (2) of the Companies (Accounts) Rules, 2014 is not applicable.
The Policy on materiality of Related Party Transactions and dealing with Related Party Transactions as approved by the Board may be accessed on the Companys website at the link at www.lakshmiautomatic.com/investors/policies/ related-party-transaction-policy/
The Directors were unable to recommend a dividend on the Equity shares for the year on account of carried over previous years losses. The 6% Cumulative Redeemable Preference Shareholders have given consent in writing for waiver of dividend.
The Company has laid down the Risk Assessment and Minimisation Procedures and on evaluation by the Audit Committee, are reviewed by the Board from time to time.
Corporate Social Responsibility
Your Company is not coming under the purview of the Corporate Social Responsibility under Section 135 of the Companies Act, 2013.
Directors and Key Managerial Personnel
Sri R.Santharam and Sri N.Jaychander, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. A brief profile of the Directors retiring by rotation and seeking re-election, is annexed to the Notice of Annual General Meeting.
The Board of Directors of the Company at their meeting held on 25.9.2017 had appointed Mr.J.Balasubramaniam as the Chief Executive Officer of the Company for a term of 2 years. There was no other changes in the Key Managerial Personnel during the year.
The details 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 are furnished in Annexure 3 forming part of the Boards Report.
Internal Financial Controls
The Company has in place adequate internal financial controls with reference to financial statements. The Internal Audit - objectives, scope, functioning, periodicity and methodology is defined in the Internal Audit Programme. The quarterly internal Audit Report is placed before the Audit Committee of the Board. The internal Auditors monitor the adequacy of internal control systems, Accounting Procedures and Policies of the Company and corrective actions based on the observations are taken wherever necessary. During the year, such controls were reviewed and no reportable material weakness in the system or operation was observed by the Audit Committee.
M/s.Subbachar & Srinivasan, Chartered Accountants, have been appointed as the Statutory Auditors of the Company, for a term of five financial years, commencing from 2017-18 and ending with 2021-22 and to hold office till the conclusion of the Annual General Meeting to be held in 2022.
Report on Corporate Governance and Management Discussion and Analysis
The report on Management Discussions and Analysis (Annexure 4) form part of the Annual Report.
Pursuant to Regulation 15(2) (a) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the compliance with the Corporate Governance provisions as specified in Regulations 17 to 27 and Clauses (b) to (i) of sub-regulation (2) of Regulation 46 and para C, D and E of Schedule V shall not apply to the Company. Hence the reporting on Corporate Governance in a separate section is not furnished. The Certificate from the Auditors of the Company to this effect is furnished (Annexure 5) . However, as a good Corporate Governance practice the company has implemented the Corporate Governance provisions and shall report the same in the Annual Report when it becomes applicable to the Company.
The Company has adopted the Vigil Mechanism/Whistle Blower Policy for Directors and Employees to report concerns about unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct or ethics policy. No personnel is denied access to the Audit Committee. No protected disclosures were received by the Nodal Officer during the year ended 31st March, 2018.
A copy of the Vigil Mechanism / Whistle Blower Policy is posted on the Companys website at www.lakshmiautomatic. com.
Demat Suspense Account / Unclaimed Suspense Account
The Share Certificates of the Company issued to the Shareholders on amalgamation of the erstwhile The Coimbatore Pioneer Machine Works Limited in exchange of the Share Certificates held by them, remained unclaimed were transferred to the Unclaimed Suspense Account. The details of the said Shares in Demat Suspense Account of the Company are :
|Sl. Particulars||No of Share holders||No. of Shares|
|(a) Aggregate Number of Shareholders and the outstanding shares held in demat suspense account lying at the beginning of the year.||1108||3197|
|(b) Number of Shareholders who approached the Company for transfer of shares from suspense account during the year||1||6|
|(c) Number of Shareholders to whom share were transferred from Suspense account during the year||1||6|
|(d) Aggregate Number of Shareholders and the outstanding Shares in the suspense account lying at the end of the year||1107||3191|
|(e) The Voting Rights on these shares shall remain frozen till the rightful owner of such shares claims the Shares.||1107||3191|
Information with respect to conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is appended hereto.
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:
1. Details relating to Deposits covered under Chapter V of the Companies Act, 2013
2. Issue of equity shares with differential rights as to dividend, voting or otherwise in terms of Section 43 and 47 of the Companies Act, 2013 and the Rules made there under.
3. Issue of shares (including Sweat Equity Shares) to employees of the Company under any scheme.
Your Directors further state that during the year under review:
1. There were no complaints pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
2. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.
3. There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the Financial Year under review and the date of this report.
4. The Annual Listing Fees for the year 2018-19 has been paid by the Company to BSE Limited.
5. No penalty or strictures have been imposed on the Company by the Capital Market Authorities for non-compliance of law, during the last three years.
|By Order of the Board|
|Coimbatore||(Sd.) S. PATHY|
|DIN : 00013899|