Maharashtra Scooters Ltd Directors Report.
The Directors present their forty-fourth (44th) Annual Report and Audited Financial Statements for the year ended 31 March 2019.
Review of operations:
The business activities of the Company, during the year under review, continued to be restricted to the (i) manufacture of die casting dies, fixtures and die casting components, primarily meant for the automobiles industry and (ii) treasury operations involving management of surplus funds invested by the Company.
The turnover of the Company during the year under review was Rs. 95.93 crore, as against Rs. 82.43 crore during the previous year. The major portion of turnover was represented by income from investments amounting to Rs. 77.29 crore, which during the previous year was ? 69.03 crore.
Continued classification as a Core Investment Company:
The company continued to meet the conditions for being classified as a Core Investment Company exempted from registration with Reserve Bank of India, pursuant to the provisions of section 45-1A of the RBI Act, 1934.
|( Rs. in lakh)|
|Particulars||FY 2019||FY 2018|
|Gross sales and other income||9592.52||8242.99|
|Gross profit before depreciation||7595.07||6208.98|
|Profit before tax||7439.86||6134.34|
|Earnings per share (Rs.)||63.70||53.16|
For the financial year ended 31 March 2019, the Directors are pleased to recommend for consideration of the shareholders at the ensuing Annual General Meeting, payment of dividend @ Rs. 33 per share (330%) on 11,428,568 equity shares of Rs. 10 each. For the financial year ended on 31 March 2018, the Company had paid a dividend @ Rs. 33 per share (330%). The amount of dividend inclusive of tax thereon for the financial year 2018-19 amounts to Rs. 4546.66 lakh, same as paid during the previous year.
The paid up equity share capital as on 31 March 2019 was Rs. 11.43 crore. During the year under review, there was no public issue, rights issue, bonus issue or preference share issue, nor had the Company issued shares with differential voting rights or granted stock options or sweat equity.
Presentation of financial statements:
The financial statements of the Company for the year ended 31 March 2019 have been disclosed as per Division ll of Schedule III to the Companies Act, 2013.
Cash flow statement:
A Cash Flow Statement for the year 2018-19 is included in the annexed Statement of Accounts.
Extract of Annual Return:
Pursuant to the provisions of section 92(3) of the Companies Act, 2013 and Rules framed thereunder, an extract of Annual Return as on 31 March 2019 in the prescribed Form No.MGT-9 is annexed to this Report (Annexure-I)
Number of meetings of the Board:
Four (4) meetings of the Board were held during the year. Detailed information is given in the annexed Corporate Governance Report.
Directors Responsibility Statement:
As required pursuant to clause (c) of sub-section (3) of section 134 of the Companies Act, 2013, the directors, to the best of their knowledge and belief, state that -
(a) in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departure;
(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
(c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis;
(e) the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls were adequate and were operating effectively; and
(f) 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.
Details in respect of frauds, if any reported by the Auditors:
No offence involving fraud committed against the Company by officers or employees of the Company was reported by the Auditors to the Audit Committee or the Board pursuant to section 143(12) of the Companies Act, 2013.
Statements on declaration given by Independent Directors:
All the independent directors have submitted declarations to the Company to the effect that they meet the criteria of independence as provided in sub-section (7) of section 149 of the Companies Act, 2013 and Regulation 16 of the SEBI Listing Regulations, as amended. After undertaking due assessment of the veracity of the declarations submitted by the Independent Directors, the Board took the same on records.
Directors remuneration policy and criteria for matters under section 178 of the Companies Act, 2013:
Information regarding Directors Remuneration Policy and criteria for determining the qualification, positive attributes, independence of a director and other matters provided under sub-section (3) of section 178 of the Companies Act, 2013 are contained in the Corporate Governance Report. The said policy is also hosted on the website of the Company: www.mahascooters.com
Particulars of loans, guarantees and investments:
The Company has not given any loans or provided any security. Full particulars of the investments made by the Company are provided in the Financial Statements attached to this Report.
Particulars of contracts and arrangements with related parties:
During the year under review, the Company did not enter into any transactions with the related parties which invoked the provisions of section 188 of the Companies Act, 2013, thereby necessitating its approval by the Board or prior approval of the Shareholders. There being no such contract with related parties, which are ‘material in nature, there are no details to be disclosed in Form AOC – 2, under the Companies Act, 2013.
During the year under review, pursuant to the provisions of section 177 of the Companies Act, 2013 and regulation 23 of the SEBI Listing Regulations, all Related Party Transactions were placed before the Audit Committee for its prior approval.
Pursuant to Regulation 23 of SEBI Listing Regulations, 2015, the Board, at its meeting held on 15 May 2019, has revised the policy on materiality of related party transactions and on dealing with related party transactions including clear threshold limits for various transactions with related parties. The said policy is hosted on the website of the company: www.mahascooters.com
Details pursuant to Rule 8(3) of the Companies (Accounts) Rules, 2014:
|Conservation of energy||The Company continued to maintain power factor to unity throughout the year, resulting in availing maximum rebate in electricity bills. Replacement of LED lamps / tubes all over the factory has also contributed to saving in electricity|
|Technology absorption||No expenditure was incurred by the Company attributable to technology absorption during the year.|
|Expenditure on Research & Development||No expenditure was incurred by the Company attributable to Research & Development during the year.|
|Foreign exchange earnings and Outgo||The Company did not earn any foreign exchange, while the outgo was Rs. 151.18 lakh|
Annual evaluation of the Board, Committees and Individual Directors:
Pursuant to provisions of the Companies Act, 2013 and regulation 25(4) of the Listing Regulations, the Board has carried out an annual performance evaluation of its own performance, the directors individually, as well as the evaluation of the working of its Committees. The manner in which formal annual evaluation was made is provided in the annexed Corporate Governance Report.
Details of Directors and Key Managerial Personnel who were appointed or resigned during the year: Change in Directors:
(i) Additional Director
During the year under review, at the board meeting of the company held on 22 October 2018, Abhinandan More (DIN 07417210) was appointed as an Additional Director, in the capacity as a non-executive / non-independent director representing Western Maharashtra Development Corporation Ltd., valid till the ensuing annual general meeting and is to be appointed by the shareholders at their said meeting.
(ii) Director liable to retire by rotation
In due compliance of the provisions of the Companies Act, 2013, Vishwanath L. Rajale retires by rotation as a director and being eligible, offers himself for re-appointment.
The information as required to be disclosed under regulation 36(3) of the SEBI Listing Regulations, 2015 in case of re-appointment of the directors is provided in the notice of the ensuing annual general meeting.
Detailed information on the directors is provided in the Corporate Governance Report.
Changes in KMP:
There has been no change in Key Managerial Personnel during the year under review.
Material orders, if any, passed by the Regulators, Courts etc.:
No material Orders were passed by any Regulators or Courts or Tribunals during the financial year under review impacting the going concern status of the Companys operations in future.
Updates on litigation involving promoters:
With respect to the litigation between the promoters, i.e. Bajaj Holdings & Investment Ltd. (BHIL) and Western Maharashtra Development Corporation Ltd. (WMDC) in connection with the sale of 27% shareholding in our company i.e. 3,085,712 equity shares by WMDC to BHIL, pending since 2003, the updates/ developments during the year under review are as follows:-
The Honble Supreme Court of India passed an Order dated 9 January 2019, directing WMDC to transfer 3,085,712 shares of the company to BHIL upon payment to WMDC an amount of Rs. 232 per Share (in place of Rs. 151.63 per share) along with interest @ 18% p.a. from the date of the Arbitral Award.
Further developments are awaited.
Details of internal financial controls with reference to the financial statements:
The Company has documented its internal financial controls considering the essential components of various critical processes, physical and operational. This includes its design, implementation and maintenance, along with periodical internal review of operational effectiveness and sustenance, which are commensurate with the nature of its business and the size and complexity of its operations.
This ensures orderly and efficient conduct of its business, including adherence to Companys policies, safeguarding of its assets, prevention of errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information.
The internal financial controls with reference to the financial statements were adequate and operating effectively.
Risk Management Policy:
The Company has adopted a Risk Management Framework for the Company, including identification therein of elements of risk, if any, which in the opinion of the Board may threaten the existence of the Company.
Material changes and commitments:
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 of the Company and the date of this report.
In terms of regulation 34 of Listing Regulations, a Report on Corporate Governance together with Certificatethereon, Management Auditors Discussion and Analysis Report & Corporate Social Responsibility Report forms integral part of Corporate Governance Report.
Business Responsibility Report:
Pursuant to regulation 34(2) of the SEBI Listing Regulations, 2015, top 500 listed companies by market capitalisation, calculated as on March 31 of every financial year, are required to include in their annual report a Business Responsibility Report, describing therein the initiatives taken by them from environmental, social and governance perceptive, in the format prescribed by SEBI.
In due compliance of Regulations aforesaid, as part of the Annual Report for the financial year 2018-19, the Company has presented its Business Responsibility Report. However, in its quest of green initiative, the Company has hosted the Business Responsibility Report on its website: www.mahascooters.com On request, a physical copy of said Report would be made available to any shareholder, free of cost.
Secretarial Audit Report:
Pursuant to the provisions of section 204 of the Companies Act, 2013, the Company had appointed Shyamprasad D. Limaye, a Fellow Member of the Institute of Company Secretaries of India and a Company Secretary in Practice (FCS No.1587, Certificate of Practice No.572), to conduct the secretarial audit and give a secretarial audit report for the year 2018-19 to be annexed to the report of Board of Directors. Secretarial audit report of Shyamprasad D. Limaye in the prescribed Form MR-3 is annexed to this report (Annexure-II). The Report does not contain any qualification, reservation, disclaimer or adverse remarks.
Further, as stipulated pursuant to SEBI Circular dated 8 February 2019, annual secretarial compliance report of Shyamprasad D Limaye, confirming compliance by company of all applicable SEBI Regulations / Circulars / Guidelines during the financial year ended 31 March 2019, is being submitted to stock exchanges. There are no observations, reservations or qualifications in the said report.
Secretarial Standards of ICSI:
Pursuant to the approval given on 10 April 2015 by Central Govt. to the Secretarial Standards specified by the Institute of Company Secretaries of India, the Secretarial Standard on Meetings of the Board of Directors (SS-1) and General Meetings (SS-2) came into effect from 1 July 2015.
These Secretarial Standards were subsequently revised, effective from 1 October 2017. The Company is in compliance with the said Standards.
Pursuant to the provisions of section 139 of the Companies Act, 2013, the members at the Annual General Meeting of the Company held on 18 July 2017 had appointed Kirtane & Pandit LLP, Chartered Accountants (Firm Registration No.105215W / W100057) as statutory auditors of the Company from the conclusion of 42nd Annual General Meeting till the conclusion of 47th Annual General Meeting, covering one term of five consecutive years, At the 43rd Annual General Meeting of the company held on 16 July 2018, the shareholders had also authorized the Board of directors to fix the remuneration of Statutory Auditors for the financial year 2018-19 and thereafter.
During the year under review, the total fees paid by the company to the Statutory Auditors, including its affiliated network entities, if any, was Rs. 10.54 lakh
The statutory audit report does not contain any qualification, reservation or adverse remark or disclaimer made by statutory auditor.
During the year under review, the industrial relations remained cordial.
Details of Directors and Employees remuneration:
Details as required under the provisions of section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are annexed to this Report (Annexure-III).
Details as required under the provisions of section 197(12) of the Companies Act, 2013 read with rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, which form part of the Directors Report, will be made available to any member on request, as per provisions of section 136(1) of the said Act.
Internal complaints committee:
The Company has a policy on prevention of sexual harassment at the workplace. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. There was no case reported during the year under review under the said Policy.
Corporate Social Responsibility (CSR) Reporting:
Detailed information on Corporate Social Responsibility Policy developed and implemented by the Company on CSR initiatives taken during the year pursuant to section 135 of the Companies Act, 2013 is given in the annual report on CSR activities annexed to this report (Annexure-IV).
|On behalf of the Board of Directors|
|Pune, 15 May 2019.||Chairman of Meeting|