Metkore Alloys Director Discussions


Dear Members,

Your Directors take pleasure in presenting the Twelfth Annual Report and the Companys audited financial statement for the Financial Year ended March 31, 2018.

Particulars 2017-18 2016-17
Revenue From Operations 891.91 1110.10
Other income 3.16 1.78
Total Revenue 895.07 1111.88
Total Expenses 2810.34 3308.88
Profit/(Loss) Before exception and (1915.27) (2196.99)
extraordinary items
Exception and Extraordinary items - -
PROFIT BEFORE TAX (1915,27) (2196.99)
Less: Current tax - -
Deferred tax (21.97) (8.42)
Profit (Loss) for the year (1893.30) (2188.57)

OPERATIONAL REVIEW

During the year the manufacturing activity 0f the company was suspended due to unviable operations and lack of sufficient resources. The power subsidy is not continued by the Government of Andhra Pradesh which was extended during the F.y. 2016-17. The representation for continuation of power subsidy for the F.y. 2017-18, 2018-19 is under active consideration of Government of Andhra Pradesh. The power contributes major input cost. The prices and availability of Ferro chrome are also hurdle to continue the operations of the company.

Your company put its efforts to find strategic partner for financial and technical support for reopening of the unit and expecting to reach out in a period to come.

DIVIDEND

The Board of Directors of the Company has not recommended any dividend to its Equity Shares in view of financial health of the Company.

TRANSFER TO RESERVES

During the period, under review, the Company has not transferred any amount to the Reserves.

SUBSIDIARY COMPANIES

The Company has no subsidiary and nothing to disclose.

INTERNAL PROCESS & FINANCIAL CONTROL

The Company has put in place an adequate internal control system along with internal audit system that commensurate with its size and activities. The reports are scrutinized by the management and placed before audit committee for its approval. The shortcomings are rectified and suggestions given for improvement.

CORPORATE SOCIAL RESPONSIBILITY (CSR) -

The Company has not taken up any CSR activities during the Financial under review due to incurring of losses -

Annexure A.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has a vigil mechanism and Whistle Blower Policy in line with the new governance requirements. The Company has established a vigil mechanism for Directors and employees to report their genuine concerns.

PREVENTION OF SEXUAL HARASSMENT AT WORK PLACES

The Company has zero tolerance for sexual harassment at workplaces and has adopted a policy on prevention, prohibition and redressal of sexual harassment in line with the provisions of the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules, there under.

During the year, no case of sexual harassment was pending at the beginning of the year and no case was received during the year nor did any case remain pending at the close of the year.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required under the Act is attached to this report - Annexure B.

ENVIRONMENT, SAFETY, HEALTH AND ENERGY CONSERVATION

Your Company has a vision of being Zero accident plant. This has been achieved through a combination of training and hardware up gradation leveraging core technology concepts and safety standards.

PARTICULARS OF EMPLOYEES

None of the employee is covered for disclosures, as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Disclosures with respect to the remuneration of Directors and employees, as required under Section 197 of Companies Act, 2013 and Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, has been appended as annexure to the report.

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Your Board of Directors states the following facts:

(a) At present 50% representation on the Board and the Chairman of the Board and Audit Committee is headed by an Independent Non executive Director.

Sri N Sankarayya is a Chief Financial Officer.

Mrs. Mahak Roy resigned from the post of Company Secretary in November 2017.

Ms. Deepika Sakhrani was appointed as a Company Secretary w.e.f. August 9, 2018.

The Independent Directors have given the certificate of Independence to your Company stating that they meet the criteria of independence as mentioned under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of SEBI (LODR) Regulation, 2015.

The details of training and familiarization programmes and annual board evaluation process for Directors have been provided under the Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors confirm that:

• In the preparation of the annual accounts, the applicable Accounting Standards have been followed and that no material departures have been made from the same;

• They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for that period;

• They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• They have prepared the annual accounts on a going concern basis;

• They have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and

• They have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

The Companys Internal Auditors have conducted periodic audit to provide reasonable assurance that the Companys established policies and procedures have been followed. The Audit Committee constituted by the Board reviews the internal control and financial reporting issues with Internal Auditors.

BOARD EVALUATION

The Board has carried out an annual performance evaluation of its own performance and that of its Committees and individual directors. The manner in which has been carried out has been explained in the Corporate Governance Report.

INDEPENDENT DIRECTORS MEETING

During the year, the Independent Directors met on February 14, 2018.

BOARD MEETING

During the year, Five Board Meetings held i.e. May 29, 2017, July 26, 2017, August 02, 2017, November 13, 2017 and February 14, 2018 as against the minimum requirement of four meetings.

EXTRA ORDINARY GENERAL MEETING

During the year, under review, no Extra Ordinary General Meeting held.

RELATED PARTY TRANSACTIONS

In line with requirements of the Companies Act, 2013 and LODR, proper reporting, approval and disclosure process are in place for all transactions between related parties and the Company. All transactions entered were in ordinary course of the business and on arms length basis. No material related party transactions i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements were entered during the year. Accordingly, related party transactions, as required under section 134(3)(h) of the Companies Act, 2013, in Form AOC 2 is not applicable.

MANAGEMENT DISCUSSIONS AND ANALISIS

The Managements Discussion and Analysis Report for the year under review, as stipulated under SEBI (LODR) Regulation, 2015, form part of this report.

CORPORATE GOVERNANCE REPORT

As per Regulation 34(3) read with Schedule V of the SEBI (LODR) Regulation, 2015, a separate section on Corporate Governance forms part of this report.

AUDITORS

a) Statutory Auditors

M/s NSVR & Associates LLP (formerly known as Nekkanti Srinivasu& Co.) [Firm Registration. No. 008801S] were appointed as Statutory Auditors by the members and hold office till the conclusion of the ensuing AGM and are eligible for re-appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for re-appointment.

The report given by the Auditors on the financial statement of the Company is part of the annual report. -

Annexure C.

Qualification made by Auditor

"Based on our audit procedures and as per the information and explanation given to us by the management, we are of the opinion that during the year the Company has delayed/default in repayment of Loan to State Bank of Travancore."

Managements Reply

The Company has approached SBT with rescheduling/OTS proposal and the same has been forwarded to SBI as the SBT has been merged with the SBI. Hence the proposal is in process.

b) Cost Auditor

M/s Jithendra Kumar & Co, Cost Accountants carried out the cost audit during the year. The Board of Directors on recommendation of the Audit Committee has appointed M/s Jithendra Kumar & Co, [Firm Reg. No 103347] Cost Accountants, as the Cost Auditor of the Company for the year 2018-19.

c) Secretarial Auditor

During the year, Secretarial Audit was carried out by Sri Ramaswamy K, Company Secretary in Practice, the Secretarial Auditor of the Company for the financial year 2017-18. There were no qualification, reservation or adverse remarks given by the Secretarial Auditor and the report is appended to this report - Annexure D.

EXTRACT OF ANNUAL RETURN

The extract of annual return in Form MGT 9, as required under Section 92(3) and rule 12 of the Companies [Management and Administration] Rules, 2014, is appended to this report - Annexure E.

DISCLOUSRE WITH RESPECT TO EMPLOYEES STOCK OPTION SCHEME

The Company does not have any Employees Stock Option Scheme.

RISK MANAGEMENT COMMITTEE

The Company has a Risk Management framework in place to identify, assess, monitor and mitigate various risks involved in the Company, which reduces adverse impact and enhance the activities undertaken by the Company. The Committee reviews the process of risk management. Pursuant to the requirement of the Companies Act, 2013, a Committee was constituted comprising S/Shri S Gajendran, Chairman, M V Bhaskara Rao IPS [Retd.] and Smt Shakuntala Prakash Bhat, all Non Executive Independent Directors as members.

The role and responsibilities of the Risk Management Committee are as prescribed under SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015, as amended from time to time and includes monitoring and review risk management plan and its risk mitigation and reporting same to the board of Directors periodically, as it may deem fit.

The Committees prime responsibility is to implement and monitor the Risk Management Plan and policy of the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORY BODIES/COURTS

During the Financial year, under review, no significant orders passed by the Regulatory/Statutory Authorities/Courts or any other Authority which would impact the going concern status of the Company and its future operations.

PARTICULARS OF LOANS, GURANTEES OR INVESTMENTS BY THE COMPANY

During the year, under review, there were no Loans, Guarantees and Investments made by the Company.

DEPOSITS

The Company has not accepted any "Deposits" as defined under the Companies Act, 2013

APPRECIATION AND ACKNOWLEDGEMENT

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment.

Your Directors also like to acknowledge the excellent support and co-operation your Company has been receiving from its bankers, suppliers, stakeholders, investors, clients, vendors, Government and Regulatory authorities.

On behalf of the Board of Directors
Place: Bengaluru S Gajendran
Date: 09.08.2018 Chairman and the Non-Executive
Independent Director
DIN : 00250136