lumax industries ltd Directors report



The Board of Directors ("Board") have pleasure in presenting the 41st Annual Report on the business and operations together with Audited Financial Accounts of the Company ("the Company") for the financial year ended 31 March 2022.


The highlights of standalone and consolidated financial performance of the Company are as follows:

(Rs inLakhs unless otherwise stated)

PARTICULARS Standalone Consolidated
For the FY 31 March For the FY 31 March
2022 2021 2022 2021
Revenue from Operations 1,75,131.10 1,42,598.07 1,75,131.10 1,42,598.07
Other Income 1,338.64 2,523.38 1,338.64 2,523.38
Total Revenue 1,76,469.74 1,45,121.45 1,76,469.74 1,45,121.45
Total Expenses 1,70,141.04 1,41,969.47 1,70,141.04 141,969.47
profit before exceptional items, income tax and share in profit/(loss) of associate 6,328.70 3,151.98 6,328.70 3,151.98
Exceptional item Gain/(Loss) (1,713.95) - (1,713.95) -
Profit of Associate - - 667.18 154.09
PROFIT BEFORE TAX (PBT) 4,614.75 3,151.98 5,281.93 3,306.07
Tax Expenses 1,071.38 1,448.13 1,209.46 1,490.84
PROFIT AFTER TAX (PAT) 3,543.37 1,703.85 4,072.47 1,815.23
Other Comprehensive Income/(Loss)Items that will not be re-classified to profit or loss and its related income tax effects
- Remeasurement of defined benefit liability/asset (332.14) 126.54 (287.02) 142.12
- Income Tax relating to above - - - -
Net other Comprehensive Income/(Loss) (332.14) 126.54 (287.02) 142.12
Total Comprehensive Income 3,211.23 1,830.39 3,785.45 1,957.35
Paid-up Equity Share Capital (Face value of Rs 10/- Per share) 934.77 934.77 934.77 934.77
Earnings Per Share (EPS) Basic/Diluted (In Rs) 37.91 18.23 43.57 19.42


After a tough financial year 2020-21, the current financial year started with lots of hope and enthusiasm for recovery across the industry. However the second wave of covid hit the industry due to which the growth as envisaged did not materialize. Despite fresh covid waves, the industry showed some resilience and after every wave of covid, the industry saw a pent up demand. However, this resilience was partly over shadowed by supply constraints for semi conductor and increase in commodity prices. Despite all these constraints, the Company has been able to achieve good performance during the year. On standalone basis, the revenue from operations during the Financial year 2021-22 stood at Rs 1,75,131.10 Lakhs as compared to Rs 1,42,598.07 Lakhs in the last year registering a growth of 23%.

For the Financial Year 2021-22, the profit before exceptional items and income tax stood at Rs 6,328.70 Lakhs as compared to Rs 3,151.98 Lakhs in the last year witnessing a significant increase of 101%. The PBT after exceptional items stood at Rs 4,614.75 Lakhs as compared to Rs 3,151.98 Lakhs in the last year registering an increase of 46%. The Profit after Tax (PAT) stood at Rs 3,543.37 Lakhs as compared to Rs 1,703.85 Lakhs registering a significant increase of 108%. The Total Comprehensive Income increased to Rs 3,211.23 Lakhs as against 1,830.39 Lakhs in the last year registering an increase of 75%. The Basic and Diluted Earnings per share stood at Rs 37.91 registering a significant increase of 108%.


For the Financial Year 2021-22 on consolidated basis, the profit before exceptional items, income tax and share in profit of associate stood at Rs 6,328.70 Lakhs as compared to Rs 3,151.98 Lakhs in the previous year witnessing a significant increase of 101%. The PBT after exceptional items and share in profit of associate stood at Rs 5,281.93 Lakhs as compared to Rs 3,306.07 Lakhs in the last year registering an increase of 60%. The Profit after Tax (PAT) stood at Rs 4,072.47 Lakhs as compared to Rs 1,815.23 Lakhs registering a significant increase of 124%. The Total Comprehensive Income increased to Rs 3,785.45 Lakhs as against Rs 1,957.35 Lakhs in the last year registering an increase of 93%. The Basic and Diluted Earnings per share stood at Rs 43.57 registering a significant increase of 124%.


The paid-up Equity Share Capital as on 31 March 2022 was Rs 934.77 Lakhs. During the year under review, the Company has not issued shares or granted stock options or sweat equity.


Your Board have recommended a Dividend @ Rs 13.50/- (i.e. 135%) per equity share having face value of Rs 10/- each for the FY 2021-22 in its meeting held on 24 May 2022 subject to approval of Shareholders in the ensuing AGM ("AGM"). The Total Dividend paid for the last financial year was Rs 7/- (i.e. 70%) per Equity Share having face value of Rs 10/- each.

The total dividend pay-out for the FY 2021-22 would work out to Rs 1,261.94 Lakhs, which is equivalent to 35.61% of the net profits of the Company during the year as against the pay-out of Rs 654.34 Lakhs in last FY 2020-21. The Register of Members and Share Transfer Books shall remain closed from Tuesday, 12 July 2022 to Friday, 22 July 2022 (both days inclusive).

The dividend as recommended by the Board, if approved by the shareholders at the ensuing AGM shall be paid to the eligible Shareholders, whose names appear in the Register of Members as on Monday, 11 July 2022 within the stipulated time period.


As per the amendment dated 5 May 2021 in the Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), (as amended from time to time), the Top 1000 Listed Companies based on Market Capitalization, has to mandatorily formulate a Dividend Distribution Policy.

Pursuant to the amended provisions of Regulation 43A of the Listing Regulations, the Board of Directors in their meeting held on 6 August 2021 had approved and adopted the Dividend Distribution Policy of the Company.

The Dividend Distribution Policy can be accessed on the website of the Company at lumaxindustries/pdf/dividend-distribution-policy-lil.pdf.


The Board of the Company do not propose to transfer any amount to reserves other than transfer of undistributed profits to surplus in statement of profit & loss.


The Company has one Associate Company viz. SL Lumax Limited, which was incorporated in the year 1997. The Company holds 21.28% in equity share capital of SL Lumax. SL Lumax is based in Chennai and primarily engaged in manufacturing of automotive components which includes lamp assemblies, chassis, mirror and front-end modules (FEM).

During FY 2021-22, the Associates profit attributable to the Company was Rs 667.18 Lakhs as compared to the Rs 154.09 Lakhs in the last year.

In accordance with the provisions of the Companies Act, 2013 (‘the Act) and Regulation 33 of the Listing Regulations and applicable Accounting Standards, the Audited Consolidated Financial Statements of the Company for the FY 2021-22, together with the Auditors Report form part of this Annual Report.

A report on performance and financial position of Associate Company included in the Consolidated Financial Statement (CFS) is presented in a separate section in this Annual Report in the prescribed format AoC-1 as a part of financial statements.

In accordance with Section 136 of the Act, the electronic copy of Financial Statements of the Associate Company shall be available for inspection in the investor section of website of the Company at lumaxindustries/associate-financials.html. Any Member desirous of obtaining a copy of the said Financial Statements may write to the Company Secretary at the Registered Office of the Company. The Financial Statements including the CFS, and all other documents required to be attached to this report have been uploaded on the website of the Company at https://www.


With the improved situation of COVID and consequent opening of the economy, FY 2021-22 was expected to be a better year after a tough year of FY 2020-21, however due to fresh waves of covid coupled with supply constraints and increase in commodity prices, the industrys performance remained subdued. According to Society of Indian Automobile Manufacturers (SIAM) report, the industry produced a total 229.33 Lakh vehicles including Passenger Vehicles, Commercial Vehicles, Three wheelers, Two wheelers and Quadricycle during FY 2021-22 as against 226.55 Lakh Vehicles produced during last FY 2020-21 showing a growth of 1.23 %. The automotive sector saw both ups and down during this period, witnessing the longest sustained downfall in automotive industry. During this turbulent and unprecedented time, the Company with its strong order book and products in development, remained the market leader and a preferred supplier for all the Original Equipment Manufacturers (OEMs) in India

The technology has been changing and evolving rapidly, and in order to always be ahead with the competition, Lumax has been focussing on strengthening its R&D capability. With this belief Lumax had opened its Design Centre in Czech Republic to have international technical competence and globalization of the same. This centre will also help to further enhance the skill of the local staff with exposure to new futuristic technologies.

It has been a pretty successful year for the Company with addition of new customers in its portfolio coupled with the new businesses from existing customers to improve top line.

With the introduction and emphasis of localization by OEMs, to avoid the risks associated with the supply chains, Lumax is investing in the upgradation of its existing manufacturing facilities alongside setting up a state of art Electronics manufacturing facility. The same will help in successful localization of technologically advanced products thus giving the customers immunity from supply chain risks with best quality products.

To succeed in the digital era, where technologies are changing the ground rules in every industry, the Company undertook several new initiatives for enhancement of its existing Information Technology (IT) systems to meet the regulatory and other organizational requirements. The Companys focus was on automation.

Top Management is very keen on Digital Transformation of the Company in the real sense and formed committee of 10 key employees from all the departments. This committee conducted various meetings with the key stakeholders and prepared detailed roadmap. This detailed roadmap has been made keeping in mind the vision of the Company, adoption of latest technologies, Automation of processes & data security. The Committee defined four stages for digital health assessment i.e. nascent, emerging, robust & Leading across all the elements of the process value chain. Companys roadmap for digital transformation is having following key objectives:

• Digitalizing all the manual processes

• Leading Design Centre as per Global Standard

• Standard Manufacturing Cockpit at plant level

• AI/ML based alert system

• Dashboard for the Top Management at Corporate Level

• Robust Data security & surveillance system to protect data as well as cyber attacks

Team is working on the above objectives and achieved good results in the digitalization of the process, Supply Chain & Security. In the next year, the Companys target is to maximize the impact of Digitalization. The Company will witness imrpovement in Marketing, Human Resource practices, Manufacturing Operations and enhance Design capabilities.

Automotive Lighting is a Safety Critical Automotive Component. Over Years several New Technologies have matured with focus on Aesthetic, Cost, Power Consumption, Improved Visibility etc. New functions are coming to improve safety and also to show the brand signature, usage of some functions on light markings to improve safety, or brand logos for styling and marketing reasons. Vehicles are embedding more and more sensors (in front, rear or side of Vehicle), which raises the challenges of their integration in the vehicle, their fusion to perceive the environment, and also the management of an increasing quantity of data (local or cloud processing, data annotation and storage). The Company is working towards continuous improvements by adding Core Engineering Strength. It has restructured the organization with an Engineering Centre for Competence (COC) & adding Specialists for developing next generation Lighting Systems for Automotive applications. It has Localized LED Projectors, Lighting Electronics, Light Guides etc to bring Value added Technologies at affordable cost to Customers. It will be launching few innovative Technologies in India Like Localized LED Projectors, LED Fog Lamps, Sealed Projector, Charging Indicator Lamps for EV application, Sequential Turn Indicator, integrated 3-in-one Signaling Functions, Lamps with 2K-3K Lens/Bezel, Full Deck-lit Lamps etc. in India for enhanced visibility & Aesthetic at Lower Power Consumption or Cost. The Company is also working on Innovative Technologies of the future (Projectors, AFS/ADB, 3D Holographic Signaling, Homogenous lit appearance, Sensor integration, Logo or Signal Projections etc.).

The Company demonstrated its commitment towards Quality by ensuring that quality processes are adhered to by all through its recently Launched LDR (Lumax Development Rule) Product Development Process. This is an Online Project Management 7 gate tool that has taken program execution towards excellence.

The Company has won accolades and awards not only from the customers but also at various industry conventions like ACMA competition, National Convention of Quality Control Circle (NCQCC), Kaizen. Also Company got International TPM awards from Japan Institute of Plant Maintenance (JIPM) for best manufacturing practices.

The Company continues to uphold the highest standards of Corporate Governance, treating its various stakeholders as an ethical requisite rather than a regulatory necessity and continue to base all its actions on the principles of fairness, trust and transparency, standing by its core values of Respect, Integrity, Passion and Excellence.

All in all, the Company made good progress in all areas in FY 21-22, and the management is quite confident that going forward the Company will continue to deliver value to all its customers and stakeholders. The longterm outlook for the Company remains positive and it is poised to outperform the industry.


The Company is constantly expanding the boundaries of its existing facilities and during the year under review, the Company has invested towards capacity expansion of its manufacturing facilities as follow:

- Capex for new Projects at plants - Rs 4,178.69 Lakhs

- Capex for new Projects at Bawal and Sanand - Rs 3,576.56 Lakhs and Rs 6,908.78 Lakhs respectively

Further, an expenditure on Research and Development facilities of Chakan and Gurugram was done to the tune of Rs 211.02 Lakhs.


Based on challenges ahead, the car industry changes to EVs and software-defined cars; the tier-1 lighting business is in a huge structural change; enabled by technologies Sensor based, Charging indicator Lamps, new lighting elements, micro optics, and much more. It looks a lot like disruption. On the safety side of business, Company has to look much more at the whole system, not only usual view to a subsystem like the headlamps. Accordingly the Company needs to develop more adaptive systems— adaptive to the complete environment. The requirements for car lighting are very different in the colourful and bright ambience of a megacity versus the dim and rainy countryside. All around the car! Lit roof rails; lit logos on the C-pillar and everywhere else; digital light; edge- to-edge front and rear position lamps; turn signal and reversing lamp projections; digital DRLs; light carpets; welcome/goodbye lights. Small projectors for dynamic ground illumination are starting to enter the car. Lit logos are trending, but legislation is still difficult. All Lighting Functions are dynamic in future. One of Companys future tasks will be providing the best light for the respective situation taking care of Styling, Quality & Cost.

Its getting complex with more Electronics content getting embedded in Automotive Lighting. India is adapting to higher end Technologies at a very fast pace with Advance Front Lighting System, Full LED Headlamps & Innovative Signalling Functions. The Company is rapidly increasing its Engineering Strength with a vision to be leading global affordable Lighting Supplier focused towards Technologies mapped with affordable LED Headlamps, Adaptive Driving Beam, Charging Indicator Lamps for EV applications, LED Projectors, LED High Beam Boosters, Logo Projections, Diffractive Holographic Signalling Functions, Sensor Integration in lamps etc.

To achieve Technology Roadmap the Company has expanded its Engineering Strength in Europe & India with the experts in Optics, Electronics & Core Engineering. This will expedite pace to catch up with Lighting Technology in west and have it available for OEMs in India at affordable cost. The Company already has tie-up with Stanley Japan which continues to be a Pillar of strength.

The Company will continue to innovate and develop world class products and put thrust and focus on R&D, Global Technology partnerships and development of advanced technological automotive products. As an annual practice, this year as well, the Company will continue to celebrate 15 September as Innovation Day, on the occasion of Engineers Day, showcasing the Companys new products and technologies to the customers.


As stipulated under the provisions of Regulation 34 of the Listing Regulations, Management Discussion & Analysis Report forms an integral part of this Report as an Annexure - A and provides details on overall Industry Structure and Developments, financial and operational performance and other material developments during financial year under review.


The Company had commenced the commercial production of automotive electronic components at its new manufacturing plant situated at Bawal, Haryana on 12 January 2022 and also the Company had commenced the commercial production at its new Sanand Plant situated at Gujarat on 29 March 2022.


During the financial year ended 31 March 2022, there was no change in the nature of business of the Company.



The Report on Corporate Governance together with the Auditors Certificate regarding the Compliance of conditions of Corporate Governance as stipulated in Regulation 34 of Listing Regulations is annexed and forms part of this Report as an Annexure - B.


The Composition of Board of Directors is in conformity with the applicable provisions of the Act and Listing Regulations.

During the year under review, the appointment of Mr. Vikrampati Singhania, who was appointed as an Additional Non-Executive Independent Director w.e.f. 11 February 2021 for a period of 5 years, was regularised by the members in the AGM held on 31 August 2021.

Further, the Board of Directors in their meeting held on 11 February 2022 had approved the reappointment of Mr Rajeev Kapoor for the second term of 5 years and the same has also been approved by the Shareholders.


In accordance with the Articles of Association of the Company and Section 152 of the Act read with the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) Mr Vineet Sahni, CEO and Senior Executive Director (DIN: 03616096) and Mr Kenjiro Nakazono (DIN: 08753913) are due to retire by rotation at the ensuing AGM and being eligible, offers themselves for reappointment.

A brief profile of Mr Vineet Sahni and Mr Kenjiro Nakazono is provided in the Notice of the ensuing Annual General Meeting of the Company.


The Board has 6 (Six) Independent Directors, including one Woman Independent Director, representing diversified fields and expertise. Details are provided in the relevant section of the Corporate Governance Report.

All Independent Directors have registered themselves with the Indian Institute of Corporate Affairs for the inclusion of their name in the data bank of independent directors, pursuant to the provision of Rule 6 (1) of Companies (Appointment and Qualification of Directors) Rules, 2014.

The Board of Directors are of the opinion that Mrs Ritika Modi, Independent Director of the Company who was appointed on 28 July 2018, have the integrity, expertise & experience and have ascertained that she has cleared the proficiency self-assessment test, conducted by The Indian Institute of Corporate Affairs (IICA), pursuant to the provisions of Rule 6 (4) of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Mr Avinash Parkash Gandhi, Mr Dhiraj Dhar Gupta, Mr Rattan Kapur, Mr Rajeev Kapoor and Mr Vikrampati Singhania, Independent Directors were exempted from appearing for the proficiency self-assessment test.

Further, as stipulated under the Regulation 17(10) and 19 read with Schedules thereto of Listing Regulations, an evaluation exercise of Independent Directors was conducted by the Nomination and Remuneration Committee and the Board of the Company and satisfied themselves with the performance and contribution of all the Independent Directors.


As on 31 March 2022, Mr Deepak Jain, Chairman & Managing Director, Mr Anmol Jain, Joint Managing Director, Mr Vineet Sahni, Whole Time Director (Senior Executive Director & CEO), Mr Tadayoshi Aoki, Whole Time Director (Senior Executive Director), Mr Kenjiro Nakazono, Whole Time Director (Executive Director), Mr Shruti Kant Rustagi, Chief Financial Officer and Mr Pankaj Mahendru, Company Secretary are regarded as Key Managerial Personnel (KMPs).


During the FY 2021-22, the Board met five (5) times on 7 May 2021, 11 June 2021, 6 August 2021, 12 November 2021 and 11 February 2022 to review the operations of the Company. It is confirmed that the gap between two consecutive meetings was not more than one hundred and twenty days as provided in Section 173 of the Act. Pursuant to the requirements of Para VII (1) of Schedule IV of the Act and the Listing Regulations, a separate Meeting of the Independent Directors of the Company was held on 24 February 2022, without the presence of Non-Independent Directors and Members of the management, to review the performance of NonIndependent Directors and the Board as a whole, the performance of the Chairperson of the Company, taking into account the views of Executive Directors, NonExecutive, Non-Independent Directors and also to assess the quality, quantity and timeliness of flow of information between the Company Management and the Board.


In terms of Section 134 (3) (c) & 134 (5) of the Act, and to the best of their knowledge and belief, and based on the information and explanations provided, your Directors hereby make the following statements:

(i) that in the preparation of the Annual Accounts for the financial year ended 31 March 2022 the applicable Accounting Standards have been followed and there are no material departures;

(ii) that the Directors have selected such accounting policies and applied 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 31 March 2022 and of the profit and loss of the Company for that period;

(iii) that the Directors 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;

(iv) that the Directors have prepared the Annual Accounts on a "going concern" basis;

(v) that the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

(vi) that 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.


In pursuance to SEBI (Listing obligations and Disclosure Requirements) (Third Amendment) Regulations, 2021, the Definition and Criteria of Independence of the Independent Directors has been amended as per Regulation 16 (1)(b) for all the Listed Companies and the same has come into effect from 1 January 2022. Accordingly the requisite declarations, as per the Regulation 16 (1) (b) and Regulation 25 read with the provisions of Section 149 (6) of the Act, have been received from the Independent Directors regarding meeting the criteria of Independence as laid down under those provisions. In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties.


Pursuant to the provisions of Section 178(1) of the Act and Regulation 19(4) read with Part D of Schedule II of Listing Regulations, the Company has in place the Nomination and Remuneration Policy of Directors, Key Managerial Personnel (KMP) and Other Employees including criteria for determining qualifications, positive attributes, independence of a Director and other matters provided u/s 178(3) of the Act.

The main features of the Policy are as follows:

• It acts as a guideline for matters relating to appointment and re-appointment of directors;

• It contains guidelines for determining qualifications, positive attributes of Directors, and independence of a Director;

• It lays down the criteria for Board Membership;

• It sets out the approach of the Company on Board Diversity;

• It lays down the criteria for determining independence of a Director, in case of appointment of an Independent Director.

During the year under review, there were no substantive changes in the Policy except to align the Policy with amendments made to applicable laws and the same is available on the website of the Company at nomination-and-remuneration-policy-of-directors-key- managerial-personnel-and-other-employees.pdf.


One of the key responsibilities and role endowed on the Board is to monitor and evaluate the performance of the Board, Committees and Directors.

Accordingly, in line with applicable provisions of the Act and Listing Regulations, the annual performance evaluation of the Board as a whole, Committees and all the Directors was conducted, as per the internally designed evaluation process approved by the Nomination and Remuneration Committee. The evaluation tested key areas of the Boards work including strategy, business performance, risk and governance processes. The evaluation considers the balance of skills, experience, independence and knowledge of the management and the Board, its overall diversity, and analysis of the Board and its Directors functioning.

Evaluation Technique

• The evaluation methodology involves discussion on questionnaires consisting of certain parameters such as Evaluation factor, Ratings and Comments, if any.

• The performance of entire Board is evaluated by all the Directors based on Board composition and quality, Board meetings and procedures, Board development, Board strategy and risk management, etc.

• The performance of the Managing Director and Executive Directors is evaluated by all the Board Members based on factors such as leadership, strategy formulation, strategy execution, external relations, etc.

• The performance of Non-Executive Director and Independent Directors is evaluated by other Board Members based on criteria like managing relationship, Knowledge and skill, personal attributes, etc.

• It also involves self-assessment by all the Directors and evaluation of Committees of Board based on Knowledge, diligence and participation, leadership team and management relations, committee meetings and procedures respectively.

• Further, the assessment of Chairman & Managing Directors performance is done by each Board Member on similar qualitative parameters.

Evaluation Outcome

The feedback of the evaluation exercise and inputs of Directors are collated and presented to the Board and an action plan to further improve the effectiveness and efficiency of the Board and Committees is placed.

The Board as a whole together with each of its committees were working effectively in performance of its key functions - Providing strategic guidance to the Company, reviewing and guiding business plans, ensuring effective monitoring of the management and overseeing risk management function. The Board is kept well informed at all times through regular communication and meets once per quarter and more often as and when need arises. Comprehensive agendas are sent to all the Board Members well in advance to help them prepare and ensure the meetings are productive. The Company makes consistent efforts to familiarize the Board with the overall business performance covering all Business verticals, by way of presenting specific performance of each Plant, Product Category and Corporate Function from time to time.

The performance of the Chairman was evaluated satisfactory in the effective and efficient discharge of his role and responsibilities for the day-to-day management of the business, with reference to the strategy and long-term objectives. The Executive Directors and NonExecutive Directors provided entrepreneurial leadership to the Company within a framework of prudent and effective controls, with a balanced focus on policy formulation and development of operational procedures. It was acknowledged that the management accorded sufficient insight to the Board in keeping it up to date with key business developments which was essential for each of the individual Directors to maintain and enhance their effectiveness.


The Composition of the Audit Committee is in alignment with the provisions of Section 177 of the Act read with rules framed thereunder and Regulation 18 of the Listing Regulations. The members of the Committee are financially literate and having experience of financial management.

As on 31 March 2022 the Audit Committee of Board comprised of Six (6) Members viz. Mr Avinash Parkash Gandhi (Chairman), Mr Dhiraj Dhar Gupta, Mr Rattan Kapur, Mr Rajeev Kapoor (Independent Directors), Mr Deepak Jain and Mr Tadayoshi Aoki (Executive Directors). Mr Pankaj Mahendru acts as Secretary to the Audit Committee.

The details regarding category of Members and terms of reference of Audit Committee had been stated in Corporate Governance Report which forms part as an Annexure - B to this Report.

All the recommendations of Audit Committee made to the Board of Directors were duly accepted by the Board of Directors.


For the FY 2021-22, all the Related Party Transactions entered into by the Company were in ordinary course of business and at arms-length basis. All Related Party Transactions, which are foreseen and repetitive in nature, are placed before the Audit Committee on yearly basis for obtaining prior omnibus approval of the Committee. The transactions entered into pursuant to the omnibus approval are placed before the Audit Committee for review and approval on quarterly basis. All Related Party Transactions are subjected to independent review by a reputed accounting firm to establish compliance with the provisions of the Act and Listing Regulations.

There were no material significant Related Party Transactions entered into, by the Company with Promoters, Directors or Key Managerial Personnel, which may have a potential conflict of interest for the Company, at large.

The details of Related Party Transactions undertaken by the Company which fall under the purview of "Materiality" as per Listing Regulations are attached in Form AOC-2 as an Annexure - C to this Report.

Further, the Shareholders approval on such Material Related Party Transactions have been taken by way of Postal Ballot Notice dated 12 November 2021 for which the results were declared by the Company on 28 December 2021.

The details of the Related Party transactions as per IND AS 24 are set out in the notes to the financial statement to the Company.

The Company has formulated a policy on Related Party Transactions, which is available on the Companys website at pdf/policy-document-on-materiality-and-dealing-with- related-party-transactions.pdf.

j. vigil mechanism/whistle blower policy

The Company has established a Vigil Mechanism named Whistle Blower Policy, for Directors, employees and business associates to report to the Management, concerns about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or ethics, in accordance with the provisions of Section 177 (10) of the Act and Regulation 22 of the Listing Regulations. This mechanism provides for adequate safeguards against unfair treatment of whistle blower who wishes to raise a concern and also provides for direct access to the Chairman of the Audit committee in appropriate/exceptional cases.

The Whistle Blower Policy is available on the website of the Company pdf/vigil-mechanism-whistle-blower-policy LIL.pdf. To further strengthen this mechanism, the Company has launched an Employee App which is available for both android and iOS users to report any instances of financial irregularities, breach of Code of Conduct, abuse of authority, unethical/unfair actions concerning Company vendors/suppliers, malafide manipulation of Company records, discrimination among employees, anonymously, to provide protection to the employees who report such unethical practices and irregularities.

Any incidents that are reported are investigated and suitable action is taken in line with the Whistle Blower Policy.

During the year under review, no incidence under the above mechanism was reported.


The Company has adopted the Code of Conduct for Directors and Senior Management of the Company. The same is available on the website of the Company of%20Conduct%20for%20Directors%20and%20 Senior%20Management.pdf


Information on Employees as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms an integral part of this Report as an Annexure - D.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names of the top ten employees in terms of remuneration drawn and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules which form part of the Boards Report, will be made available to any shareholder on request, as per provisions of Section 136(1) of the Act.


The Company has a robust and effective framework for monitoring compliances with applicable laws. The Company has installed a Software namely AVACOM for Compliance Management and through this Software the Company is able to get the structured control over applicable compliances by each of the units of the Company.

A separate Corporate Compliance Management Team periodically reviews and monitors compliances by units and supports in effective implementation of same in a time bound manner. The Board and Audit Committee alongwith Compliance team periodically monitors status of compliances with applicable laws based on quarterly certification provided by Senior Management.



The Company has a robust and well embedded system of internal controls in place to ensure reliability of financial reporting, orderly and efficient conduct of business, compliance with policies, procedures, safeguarding of assets and economical and efficient use of resources. Appropriate review and control mechanisms are put in place to ensure that such control systems are adequate and operate effectively.

Periodical programs of Internal Audits are planned and conducted which are also aligned with business objectives of the Company. The meetings with Internal Auditors are conducted wherein the status of audits and management reviews are informed to the Board.

The Company periodically conducts physical verification of its inventory, fixed assets and Cash on hands and matches it with the books of accounts. Explanations are sought for any variance noticed from the respective functional heads.

The Company has adopted accounting policies which are in line with the Indian Accounting Standards notified under Section 133 of the Act read with the Companies (Indian Accounting Standard) Rules, 2015.

The Company gets its Standalone and Consolidated Financial Statements reviewed every quarter by its Statutory Auditors.

The Company uses an established SAP ERP HANA Systems to record day to day transactions for accounting and financial reporting. The SAP system is configured to ensure that all transactions are integrated seamlessly with the underline books of accounts, which helps in obtaining accurate and complete accounting records and timely preparation of reliable financial disclosures.

b. RISK Management pOLICY

Earlier the Risk Management Policy was not applicable to the Company as per the Listing Regulations but as a Good Corporate Governance Practice, the same was formulated along with the voluntary constitution of the Risk Management Committee.

During FY 2021-22, as per amended Regulation 21 of the Listing Regulations which came into effect from 5 May 2021, it became mandatory for the Top 1000 Listed entities to constitute the Risk Management Committee with majority of the members of Committee to be amongst the directors and senior executives of the Company with at least one independent director and Chairperson to be a member of Board.

Accordingly, the Board of Directors in their meeting held on 6 August 2021, re-constituted the Risk Management Committee and amended the Risk Management Policy.

The Risk Management Committee is responsible to frame, implement and monitor the risk management plan for the Company. The Committee is responsible for development and implementation of a Risk management Policy for the Company including identification therein elements of risk, if any, which in the opinion of the Board may threaten the existence of the Company and is responsible for reviewing the risk management plan and its effectiveness. The Company has Risk Management Policy which can be accessed on Companys website management-policy-lil.pdf.

c. AUDITORS Statutory Auditors

M/s B S R & Associates LLP, Chartered Accountants (FRN:116231W/W-100024), Statutory Auditors of the Company, have completed their tenure of 5 years and accordingly will cease to act as Statutory Auditors upon the conclusion of the ensuing Annual General Meeting. M/s B S R & Associates LLP, Chartered Accountants have maintained the highest level of governance and substantially contributed in to the efforts of the Company towards strengthening the internal controls, processes and procedures in line with expanding size of operations. The Board places on record its deep sense of appreciation for the services rendered and guidance given by them as the Statutory Auditors of the Company. M/s S.R. Batliboi & Co. LLP, Chartered Accountants (FRN: 301003E/E300005) have agreed to and given their consent for their appointment as the Statutory Auditors of the Company.

M/s S.R. Batliboi & Co. LLP, Chartered Accountants have furnished a certificate confirming that they are not disqualified for being appointed as Auditors of the Company.

In terms of Section 139(2) of the Act, the Board, upon recommendation of the Audit Committee, has recommended the appointment of M/s S.R. Batliboi & Co. LLP, Chartered Accountants as the Statutory Auditors of the Company, for a period of five consecutive years from the conclusion of the 41st Annual General Meeting up to the conclusion of the 46th Annual General Meeting, to the members of the Company for approval.

Accordingly, an item for appointment of M/s S.R. Batliboi & Co. LLP, Chartered Accountants as the Statutory Auditors of the Company for a period of 5 (five) years is being placed at the ensuing AGM for approval of the members. Information about the proposed appointment of M/s S.R. Batliboi & Co. LLP is given under the Notice of AGM, which forms part of this Annual Report.

Statutory Auditors Report

The Report given by M/s B S R & Associates LLP, Chartered Accountants on the Financial Statements of the Company for the FY 2021-22 forms part of the Annual Report. There are no qualification, reservation, adverse remark, or disclaimer given by the Auditors in their Report.

Cost Auditors

In terms of Section 148 (1) of the Act, the Company is required to maintain cost records for certain products as specified by the Central Government and accordingly such accounts and records are prepared and maintained in the prescribed manner.

The Board, on recommendation of Audit Committee, has re-appointed M/s Jitender, Navneet & Co. (Firm Registration No. 000119) as the Cost Auditors of the Company, for the audit of the cost accounts of the Company for the FY 2022-23.

The remuneration proposed to be paid to the Cost Auditor requires ratification by the shareholders of the Company. In view of this, your approval for payment of remuneration to Cost Auditors is being sought at the ensuing AGM. Accordingly, a resolution, seeking approval by members for the ratification of the remuneration to be paid to Cost Auditors amounting to Rs 1.75 Lakhs (Rupees One Lakh Seventy-Five Thousand only) excluding taxes and out of pocket expenses, if any, payable to M/s Jitender, Navneet & Co., is included in the Notice convening 41st AGM of the Company.

Cost Audit Report

The Cost Audit Report for the FY 2020-21 has been filed with the Central Government within the stipulated time. Disclosure On Maintenance Of Cost Records As Specified By Central Government Under Sub Section (1) of Section 148

The Company is maintaining cost records as stipulated under law.

Secretarial auditor

Pursuant to the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed Mr Maneesh Gupta, Practicing Company Secretary (M. No. F4982) as the Secretarial Auditor of the Company to conduct the Secretarial Audit for FY 2022-23.

The Company has received consent from Mr Maneesh Gupta to act as the auditor for conducting audit of the secretarial records for the financial year ending 31 March 2023.

Annual Secretarial Audit Report & Annual Secretarial Compliance Report

The Secretarial Audit Report for the financial year ended 31 March 2022 under the Act, read with Rules made thereunder and Regulation 24A (1) of the Listing Regulations is set out in the annexure - E to this Report. There are no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

Pursuant to Regulation 24 A (2) of Listing Regulations, all listed entities on annual basis are required to get a check done by Practising Company Secretary (PCS) on compliance of all applicable SEBI Regulations and circulars/ guidelines issued thereunder and get an Annual Secretarial Compliance Report issued in this regard which is further required to be submitted to Stock Exchanges within 60 days of the end of the financial year.

The Company has engaged the services of Mr Maneesh Gupta (M. No.: F 4982), PCS and Secretarial Auditor of the Company for providing this certification.

Accordingly, the Company has complied with the above said provisions and an Annual Secretarial Compliance Report has been submitted to the Stock Exchanges within stipulated time.

Internal Auditors

In compliance with the provisions of Section 138 of the Act, read with the Companies (Accounts) Rules, 2014, the Internal Audit, of various units of Company, for the FY 2021-22 was carried out by M/s Grant Thornton Bharat LLP. Further, the Board in their meeting held on 24 May 2022 has appointed M/s Grant Thornton Bharat LLP as Internal Auditors for the FY 2022-23.


During the year under review, no frauds were reported by Statutory Auditor and Secretarial Auditor against the Company which need to be mentioned in this Report.


The Companys Corporate Social Responsibility (CSR) objective is to give back to society and contribute to nations development through its initiatives.

The Companys CSR initiatives are implemented primarily through its CSR arm/trust, Lumax Charitable Foundation ("Foundation"), with focus on education, empowerment of girl child through education and the healthcare, for disadvantaged Section of society.

During the year, the Companys obligation to spend on CSR activities was Rs 128.87 Lakhs i.e. 2% of the average net profits during the three immediately preceding financial years against which the Company has actually spent Rs 134.45 Lakhs. Also the unspent amount of CSR on ongoing projects for the FY 2020-21 amounting to Rs 46.54 Lakhs along with the interest amount of Rs 0.70 Lakhs has been spent during the FY 2021-22.

The Company has constituted a CSR Committee of the Board and also developed & implemented a CSR Policy in accordance with the provisions of the Act. The Committee monitors and oversees various CSR initiatives and activities of the Company.

Key CSR Activities

Lumax provides holistic education opportunities and preventive and curative health interventions, committed to the India Sustainable Goals of Quality Education and Good Health. These interventions and programs are managed by the Lumax Charitable Foundation team along with implementation partners.


In its endeavor to provide holistic and quality education, the interventions include, girl child enrolment in schools, starter kits and learnings aids. It is to provide and enable underprivileged students to enhance their learning experience through out of school learning activities like excursion trips, end-to-end career counselling, life-skills & soft-skills training on a continuous basis. The programs help to facilitate various govt. & private scholarships to deserving need-based and merit-based students to pursue with their education.

Infrastructure needs of the govt. schools including the construction of toilets, classroom, providing LED lights are also undertaken after a thorough need assessment. The programs are preferably conducted in areas around the Companys plants.


Under health, the Foundation has been supporting communities near the plants with preventive cancer awareness and screening camps and also provide eye care camps for eye-check up and conducting cataract surgeries. The cancer screening includes blood profiling along with physical examination by a surgeon, ENT specialist and a gynecologist, complete with radiology examination. The Company had also donated the oxygen concentrators, ventilators and other equipments to help the Covid Patients.

The programs also include Juvenile diabetes for the underprivileged children and a mobile path lab for communities donated to the Primary Health Centre (PHC).

Constitution of CSR Committee

As on 31 March 2022, the CSR Committee of the Company comprised of three (3) Members namely, Mr Deepak Jain (Chairman), Mr Avinash Parkash Gandhi and Mr Anmol Jain.

The details of the CSR Policy of the Company are also available on the website of the Company at

The contents of the said policy are as below:

a. CSR Philosophy

b. Constitution of CSR Committee

c. Role of CSR Committee

d. Implementation of CSR Projects, Programs and Activities

e. Allocation of Budget

f. Lumax domains of engagement in accordance with Schedule VII

g. Monitoring and Review Mechanism

h. Management Commitment

The Annual Report on CSR as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as an Annexure - F to this Report in the prescribed format.


Material Changes and Commitments

No material changes and commitments affecting the financial position of the Company have occurred after the end of the financial year ended 31 March 2022 till the date of this Report.


The particulars of Investments and Loans as on 31 March 2022 as covered under the provisions of Section 186 of the Act is given in the Notes to Financial Statements of the Company. The Company has not given any guarantees during the year under review.

Information on Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

One of the several commitments that continued to remain in force throughout the financial year was developing business along with improvement in environmental performance to maintain a reliable and sustainable future. During the course of the year, the manufacturing units of the Company have continued their efforts to reduce energy consumption in all areas of their operations with energy efficient technologies and offtake of electricity from renewable sources wherever feasible. These manufacturing units are constantly encouraged to improve operational activities and maximizing production volumes and minimizing consumption of natural resources. Systems and processes have been put in place for utilization of alternate sources of energy and monitoring of energy consumption for all the units.

Disclosure of information regarding Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo, etc. as required under Section 134(3) (m) of the Act read with the Companies (Accounts) Rules, 2014, is annexed as an Annexure - G to this Report. Annual Return

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31 March 2022 is available on the Companys website on lumaxindustries/annual-return.html.

Details of Fixed Deposits

During the year under review, the Company has neither accepted nor renewed any Deposit in terms of Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 and hence any provisions of the said Section are not applicable to the Company.

Names of Companies which have become or ceased to be Its Subsidiaries, Joint Ventures or Associate Companies during the Year

During the FY 2021-22, there were no companies which became Subsidiary or Joint Venture of the Company, nor the Associate Company ceased to be an Associate of the Company.

Significant and Material Orders passed by the Regulators or Courts

There are no significant and material orders passed by the Regulators/Courts/Tribunals, which would impact the going concern status of the Company and its future operations.

Constitution of Internal Complaints Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (pOSH)

As per Section 134(3) of the Act read with Rule 8 of Companies (Accounts) Rules, 2014, a "Statement that the Company has complied with the provisions related to Constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH)" has to be included in the Boards Report.

In accordance with the above-mentioned provisions of POSH, the Company is in compliance with and has adopted the "Policy on Prevention of Sexual Harassment of Women at Workplace" and matters connected therewith or incidental thereto covering all the related aspects. The constitution of ICC is as per the provisions of POSH and includes external Members from NGO or those individuals having relevant experience.

The Committee meets as and when required and provides a platform for female employees for registration of concerns and complaints, if any.

During the year under review i.e. FY 2021-22, Twenty Five (25) meetings and Forty Two (42) awareness sessions were held across all manufacturing locations to discuss on strengthening the safety of employees at workplace. In addition, the awareness about the Policy and the provisions of Prevention of Sexual Harassment Act was also carried out in the said meetings. Further, as per the applicable provisions of POSH, the Company continues to submit Annual Report to the District Officer consisting of details as stipulated under the said Act.

Environment, Health, Safety

The Company continues to identify and manage risk to ensure the health & safety of the employees. The Company focuses on "Health and Safety" continuously to ensure policies, procedures and systems to meet the requirements of current legislation and best practices. Over the last six years the Company has been working to strengthen the position in relation to health and safety management. This has been a process of gradually tightening up on policies and procedures and ensuring that these remain relevant and up-to date. The Company has improved systems for carrying out risk assessments and making sure that they are regularly reviewed; for tracking of workers; workstation assessments and for many other aspects of a good health and safety management system. From the work commenced during 2021-22 to deliver the Corporate Health and Safety Action Plan and maintain the profile of health and safety, the Company has continued to work closely with its internal Safety Officers and external Agencies to build on that work and promote continuous improvement.

Key aims and objectives achieved in 2021-22 includes: Strong and Active Leadership:

• Corporate safety procedures were reviewed and Health and safety management audit program delivered.

• Health and safety competence, awareness & training was in place.

• Safety performance and risk management arrangements established in the organization.

• Team approach has continued to progress key health and safety objectives.

• Continuation of strong health and safety Management System through the established safety committees to ensure effective communication and consultation arrangements for discussion and promotion of health and safety improvements at scale and place.

• Health & safety as a standing item on all Corporate, Directorate and manager meeting agendas to embed best practice and drive cultural change and improvement.

Apart from the above, the Company has also performed below activities in FY 2021-22 sincerely:

1. Hazards specific Safety training (Fire Fighting, First Aid, Electrical Safety, Chemical & Machine Safety)

2. KYT - Kiken Yochi Training (Identifying hazard and taking corrective measures with the help of actual users)

3. Regional Safety Meeting at all regions.

4. Safety Gemba Audit and Monitoring.

5. Fire Risk Assessment.

6. Comprehensive review/surveillance audit done as per ISO 14001:2015 (Environment Management System) and ISO 45001:2018 (Occupational Health & Safety Management system)

7. Near miss incident capturing and Investigation.

8. Celebrated the Fire Safety week, Safety Week and Environment Day to create the Safety awareness among the workers.

9. Surface treatment - Duct Cleaning for all locations.

For Tier-2 Suppliers:

From the last Five years, the Company also commenced the Fire Risk Assessment Audit for Tier-2 suppliers (62 Nos) to reduce the fire related incident and achieved significant OK result.

Also the Company has initiated for safety and started the Safety Audit from 2019-20 for (7 Nos) suppliers to reduce the human injury. (only for those who are heaving the heavy power press machinery- Critical Operation).

Apart from the above activities, the Company is strictly monitoring the injury status and sharing every month to its Vendors and also delivered Training awareness program related to Fire, Electrical, Machine Safety and Fire Mock drill.


Pursuant to the provisions of Section 124(5), 125 and other applicable provisions of the Act, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), all unpaid or unclaimed Dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven (7) years from the date of transfer to Unclaimed/Unpaid Dividend Account of the Company.

Further, pursuant to provisions of Section 124(6) of the Act read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the shares in respect of which Dividend has not been claimed or unpaid by the shareholders for seven (7) consecutive years or more shall also be transferred to the Demat account of IEPF Authority. The said provisions does not apply to shares in respect of which there is a specific Order of Court, Tribunal or Statutory Authority, restraining any transfer of the shares.

Accordingly, the details relating to amount of Dividend transferred to the IEPF and corresponding shares on which Dividends were unclaimed for seven (7) consecutive years, are provided in the Report on Corporate Governance annexed to this Report.

It may be noted that the due date for transfer of the Unpaid/Unclaimed Dividend lying in the Unpaid Dividend Account of the Company for the FY 2014-15, which was declared on 19 August 2015, to IEPF is 20 September 2022. Further, all shares in respect of which dividend has not been paid or claimed for seven con secutive years or more shall also be transferred to IEPF i.e. in case any divid end is claimed for any year during th e said period of seven consecutive years, the shares shall not be transferred to IEPF.

Accordingly, concerned Shareholders are requested to kindly claim the Unpaid/unclaimed Dividend along with the underlying Shares. The Notice pursuant to the provisions of Section 124 of the Act read with IEPF (Accounting, Audit, Transfer and Refund) Rules, 2016 will be published in the newspapers viz Financial Express (English- All Edition) and Jansatta (Hindi-Delhi), titled- "Transfer Of Unpaid/ Unclaimed Dividend And The Underlying Equity Shares To The Investor Education And Protection Fund (IEPF) Account" inviting the attention of the Shareholders to claim their Dividends along with the underlying Equity Shares and in this regard, the Company will also send individual notices to the concerned Shareholders.


In compliance with the Securities and Exchange Board of India (Prohibition of Insider Trading) (Amendment) Regulations, 2018, the Company has adopted a Code of Conduct to regulate, monitor and report trading by Designated Persons [Pursuant to Regulation 9 of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015]. This Code of Conduct is intended to prevent misuse of Unpublished Price Sensitive Information ("UPSI") by Designated Persons and their immediate relatives.

The said Code lays down guidelines, which advise Designated Persons and Insiders on the procedures to be followed and disclosures to be made in dealing with the shares of the Company and cautions them on consequences of non-compliances. This Code includes a Policy and Procedure for Inquiry in case of leakage of Unpublished Price Sensitive Information or suspected leakage of Unpublished Price Sensitive Information and is available for reference on the website of the Company i.e. of-conduct_SEBI-egulations-2015.pdf.


A detailed Business Responsibility Report in terms of the provisions of Regulation 34 of the Listing Regulations is available as a separate section in the Annual Report.


The Company has complied with the Secretarial Standard-1 (Meetings of Board of Directors) and Secretarial Standard-2 (General Meetings) issued by the Institute of Company Secretaries of India.


The Company is a regular payer of taxes and other duties to the Government. During the year under review, the Company paid all its statutory dues & presently no undisputed dues are outstanding for more than six months. The Company generally ensures payment of all dues to exchequer well within time line as applicable.


The Board of Directors place on record their sincere gratitude and appreciation towards all its Stakeholders viz. shareholders, employees, investors, bankers, customers, suppliers, government agencies, stock exchanges and depositories, auditors, legal advisors, consultants, business associates, service providers, academic partners for their continued commitment and support. The Board conveys their deep sense of appreciation towards contributions made by every member of Lumax Family during the year and express a sincere thanks and gratefulness to its Technical & Financial Collaborator- Stanley Electric Co., Limited for their continued support and patronage throughout the year.

For and on behalf of the Board of Directors Lumax Industries Limited
Deepak Jain Chairman & Managing Director
Place: Gurugram
Dated: 24 May 2022