Machino Plastics Ltd Directors Report.
Your Directors have pleasure in presenting the 34th Annual Report and Audited Financial Statements for the Financial Year ended 31st March, 2019.
FINANCIAL SUMMARY AND HIGHLIGHTS
|(Rs. In Lacs)|
|Income from operation (net of excise/GST)||30,594.32||30287.20|
|Profit/(before financial charges, depreciation and tax)||2,811.77||2610.90|
|Depreciation & Impairment expenses||1,907.08||1944.56|
|Profit before tax||177.57||11.59|
|Provision for tax(after adjustment of deferred tax)||(302.71)||(29.17)|
|Profit after tax||480.29||40.77|
|Other Comprehensive Income||6.27||10.14|
|Total Comprehensive Income for the period||486.56||50.91|
Net turnover of your Company has decreased by 1% from Rs.30594.32 lacs in 2017-18 to Rs.30287.20 lacs in current year. Your Company has earned a pre-tax profit of Rs.11.59 lacs as compared to profit of Rs. 177.57 lacs in the last year.
RESULTS OF OPERATIONS OPERATIONS:
During the year under review, the following are the highlights of your Company:
> Achieved a turnover during 2018-19 of Rs.30287.20 lacs as compared to Rs.30594.32 lacs during 2017-18 reflecting a decrease of 1%.
> Profit before tax during 2018-19 is Rs. 11.59 lacs against pretax profit during the year 2017-18 of 177.57 lacs.
> Profit after tax during 2018-19 is Rs.40.77 lacs against post tax profit during the year 2017-18 of Rs. 480.29 lacs.
> Total Comprehensive Income during 2018-19 is Rs.50.91 lacs as compared to Rs. Rs. 486.56 lacs during previous financial year 2017-18.
> Pre- tax Cash Profit during 2018-19 is 1956.15 lacs against pre- tax cash profit during the year 2017-18 of Rs. 2,084.65 lacs
INTERNAL FINANcIAL cONTROL
Your company has in place adequate internal financial controls in accordance to the size of the company and with reference to financial statement. The internal financial controls have been regularly reviewed by the auditors of your company and no reportable material weakness in the design or operation was observed.
Your Directors recommend a dividend of 10 %( i.e., Re.1 per equity shares of Rs. 10/- each) of the financial year 201819 amounting to Rs. 61,36,800/-. The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting.
The dividend shall be paid to members whose names appear in the Register of Members as on 7th August, 2019 and in respect of shares held in dematerialized form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owner as on that date.
The dividend income is tax free in the hands of the shareholders.
AMOUNT TRANSFERRED TO RESERVE
Your company proposed to transfer an amount of Rs. 5,00,000/- to general reserve out of the profits of the company.
EXTRACT OF ANNUAL RETURN
The detail forming part of the extract of the Annual Return in Form No MGT - 9 in accordance with the provisions of Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as Annexure-I to this Report.
NUMBER OF BOARD MEETINGS
The details of the number of Board and Audit Committee meetings of your Company are set out in the Corporate Governance Report which forms part of this Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134 sub section (5) of the Companies Act, 2013 the directors of your company state-
That in preparation of the annual accounts for the financial year ended 31st March, 2019, the applicable accounting standards have been followed and there are no material departures from the same.
That 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 true and fair view of the state of affairs of the company at the end of the financial year as at 31st March, 2019 and of the profit of the Company for the year ended 31st March, 2019.
That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities.
That the annual accounts have been prepared on a going concern basis.
That proper internal financial controls laid down by the directors to be followed by the Company and that such internal financial controls are adequate and is operating effectively; and
That proper system to ensure compliance with the provisions of all applicable laws is adequate and is operating effectively
DECLARATION BY INDEPENDENT DIRECTOR
Your Company has received declarations from all the Independent Directors that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 read with Schedule and Rules issued there-under, and also in accordance to Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015.
Your company has adopted the remuneration policy in accordance with Section 178 read with rules made there under for directors appointment and remuneration including the criteria for determining qualifications, positive attributes, independence of a director, etc. in the meeting of Board of Directors of the Company held on 9th February, 2015 in line with the recommendation of Nomination and Remuneration Committee; whose meeting also held on the same date. The remuneration policy of your Company is annexed in Annexure-II. The policy has been disclosed on the website of the company.
AUDIT AND AUDITORS REPORT:
M/s. KMGS & Associates, Chartered Accountants, were appointed as Statutory Auditors of the Company to hold office till the conclusion of ensuing Annual General Meeting for the financial year 2018-19.
STATUTORY AUDITORS REPORT
There are no such observations in the statutory audit report which needs to be explained by your company. The observation of the auditors is self- explanatory and/or is suitably explained in the notes to the accounts.
M/s A.K. & Associates, Practicing Company Secretary, were appointed as Secretarial Auditor for the financial year 2018-19 for secretarial audit of your company.
SEcRETARIAL AUDIT REPORT
There are no such observations in the secretarial audit report which needs to be explained by your Company. The report of secretarial auditor is annexed to this report as Annexure VIII.
SECRETARIAL COMPLIANCE REPORT
There are no such observations in the secretarial compliance report which needs to be explained by your Company. The report of secretarial auditor is annexed to this report as Annexure IX.
PARTICULARS OF LOAN, GUARANTEES OR INVESTMENT BY THE COMPANY
Your Company has not given any loan, guarantee or made any investment in any other body corporate as per the provision of section 186 of the Companies Act, 2013, except as disclosed in the attached accounts.
RELATED PARTIES TRANSACTIONS
All related party transactions that were entered into during the financial year 2018-19 were in the ordinary course of business and on an arms length basis or with required approvals. Your company has also adopted a policy on materiality of related parties transaction and also dealing with related parties transaction as approved by the Board. The policy has been disclosed on the website of your company at www.machino.com
The details of related parties transaction whether requiring approvals or otherwise, as per the provision of Section 188 of the Companies Act, 2013, Form AOC-2 is annexed in Annexure-III.
STATE OF COMPANYS AFFAIR
Your company is a joint venture Company of Maruti Suzuki India Limited, Suzuki Motor Corporation and Jindals. Your company was incorporated in 1986. Your company is a going concern. The shares of your company are listed on Bombay Stock Exchange Limited. Your company is engaged in the production of plastics moulded automotive components. Your company has total 3 plants out of which one operative plant is located in Gurgaon, one operative plants are located in Manesar while the plant located in Pithampur is non- operative and is yet to commence production.
During the year under review, your company has not made any default in repayment of any of its term loans, have met generally all its obligation in time including its tax liabilities.
details of significant and material order
No significant or material orders have been passed by any regulators or court or tribunals impacting the going concern status and future operations of your company.
MATERIAL CHANGES AND COMMITMENTS
No significant changes and commitments affecting the financial position of your company for the financial year ending on 31st March, 2019 till the date of this report.
CONSERVATION OF ENERGY
Continuous overhauling of equipments and awareness amongst employees has helped to avoid wastage of energy. Company has installed solar power plant of capacity 310KW at its Manesar Plant and 503KW plant at Gurgaon.
Series of steps have been taken to identify areas of excess consumption of power and checks have been strengthened at these points and various alternative sources of energies are utilized.
Data regarding energy consumed is given hereunder:
|Power & Fuel consumption||2017-18||2018-19|
|(a) Purchase units/co-generated||19,656,538||18,996,315|
|Total Cost (Rs. In lacs)||1590.57||1,670.96|
|Rate per units||8.09||8.80|
|(b) Own Generation - D.G. Set|
|Fuel Cost (Rs. In Lacs)||107.90||86.24|
|Fuel cost per unit||16.94||21.86|
|3. Furnace Oil||NIL||NIL|
|Other/Internal generation/ Solar power||2, 50,415||401,043|
A statement giving details of technology absorption in accordance with the above Rules is annexed hereto as Annexure VI and forms part of the Report.
FOREIGN EXCHANGE EARNING & OUTGO
|Rs. In Lacs|
|Total foreign exchange earning||148.15|
|Total foreign exchange outgo||1913.41|
RISK MANAGEMENT POLICY
Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your company already has "Risk Management Policy" in writing which is also uploaded on the website of the company. The policy is regularly updated taking in to consideration the changes taking place in the business environment. Your company manages monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives.
ANNUAL Evaluation Of PERFORMANcE
The performance evaluation of all:
independent directors were made by Board (excluding the director who performance is being evaluated),
non independent directors were made by the independent directors in its meeting
the board committees and of the board as whole was made by Nomination and Remuneration Committee
Your company has also adopted a policy for evaluation of performance of the board and individual director in the meeting of the board of directors in line with the recommendation of Nomination and Remuneration Committee. The policy of annual evaluation is annexed in Annexure - IV.
The policy has also been disclosed on the website of the company.
Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, your Company has established the Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations & Disclosure Requirements), Regulations, 2015 for directors and employees of the Company to report genuine concerns or grievances. The Vigil Mechanism provides the safeguard against the victimization of person who uses such mechanism.
During the financial year 2018-19, all the directors and employees had full access to approach the Vigil Mechanism Officer. No complaint was received during the year 2018-19 of any sort from any directors and employee of your company.
Mrs. Anupam Gupta has been appointed as Vigil Mechanism Officer with effect from 28.03.2019 under Whistle Blower Policy in place of Mr. R. Krishnan who has resigned w.e.f. 27.03.2019.
The detail of establishment of such mechanism is also disclosed on the website of the Company and also enclosed as per Annexure -V.
According to Section 149 of the Companies Act, 2013 read with schedule IV of the Companies Act, 2013, an independent director is required to hold office for a term up to five consecutive years on the Board of the Company. No independent director shall hold office for more than two consecutive terms, but shall be eligible for appointment after the expiry of three years of ceasing to become an independent director of the company.
Mr. Ajit Yadav was appointed as an Additional Director (Non-Executive Independent Category Director) at the meeting of the Board of Directors held on 23.05.2019 and subsequently he is proposed to be appointed as an Independent Director by the shareholders at the AGM held on 07.08.2019.
Mr. Rajiv Kumar Singh and Dr. Sandeep Goel were appointed as an Additional Director (Non-Executive Independent Category Director) at the meeting of the Board of Directors held on 30.05.2019 and subsequently they are proposed to be appointed as an Independent Director by the shareholders at the AGM held on 07.08.2019.
In accordance with the provisions of Section 168(1) of Companies Act, 2013, Mr. R. Krishnan, an Independent Director of your company has resigned w.e.f. 27th March, 2019.
On completion of tenure Mr. R.L. Gaggar and Mr. Sundaram Balasubramanian have ceased to be the directors on the board of company with effect from 1st April, 2019.
The details of the Audit Committee including its composition and terms of reference mentioned in the Corporate Governance Report forms part of Directors Report.
FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTOR
Your Company has organized a familiarization programme for the independent directors as per the requirement of the Companies Act, 2013 along with the requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The detail of such familiarization programme is also uploaded on the website of the company at www.machino.com.
The Equity Shares of the Company are listed on Bombay Stock Exchange. The company has paid listing fees to the Stock Exchange for the financial year 2019-20.
Your Company always places major thrust on managing its affairs with diligence, transparency, responsibility and accountability thereby upholding the important dictum that an organizations corporate governance philosophy is directly linked to high performance.
Pursuant to Regulation 27(2) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the company regularly submits the corporate governance report to the Stock Exchanges within the prescribed time line. Therefore, Reports on Corporate Governance has been included in this annual report as a separate section (forming a part of Directors Report) along with the Auditors Certificate.
Your Company has not accepted any deposits under Section 73 of the Companies Act, 2013 & rules made there under.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required by Regulation 34(2) (e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report are presented in a separate section forming part of the annual report.
DETAILS OF SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES
None of the company has become or ceased to become the subsidiary, joint venture or associate of your Company during the financial year 2018-19.
PARTICULAR OF EMPLOYEES AND RELATED DISCLOSURES
Details of employee of the Company as specified under Section 197 of the Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed hereto as Annexure-VII and forms part of the report.
TRANSFER OF SHARES TO INVESTOR EDUCATION AND PROTECTION FUND AUTHORITY
Pursuant to the section 124(6) of the Companies Act, 2013, your company has transferred 4810 shares to Investor Education and Protection Fund Authority.
The Company is not involved in any type of activity hazardous to environment and does not discharge any trade effluents (solid, liquid or gaseous) causing pollutions. As an environment conscious responsible corporate citizen, your Company has implemented GSCM (Green Supply Chain Management) standards.
CORPORATE SOCIAL RESPONSIBILITY
The provision of section 135(1) of Companies Act 2013 i.e. Corporate Social Responsibility is not applicable on your company. Therefore your company has not constituted CSR committee for this.
Your Directors wish to place on record their appreciation for the valuable co-operation and assistance extended by Maruti Suzuki India Limited., Suzuki Motors Corporation, Japan, Government of India, Government of Haryana and the Companys bankers for their continued support and guidance. The Directors also commend the continuing commitment and dedication of the employees at all levels and are thankful to the shareholders for their continued patronage, trust and confidence in the Company.
|For and on Behalf of the Board|
|Machino Plastics Limited|
|Chairman cum Managing Director|
|Date: 30th May, 2019|