national general industries ltd share price Directors report

RESULTS OF OPERATIONS AND STATE OF COMPANYS AFFAIRS

The Highlights of the Companys performance for the year ended on March 31, 2023 are as under: Value of Sales decreased to Rs. 610.02 lakhs (PY Rs. 1258.41 lakhs) Value of Job Work Services increased to Rs. 734.11 lakhs (PY Rs. 567.84 lakhs) Value of Other Income increased to Rs. 111.19 lakhs (PY Rs. 109.91 lakhs) PBDIT decreased to Rs.54.07 lakhs (PY of Rs. 55.99 lakhs) PBT increased to Rs. 21.81 lakhs (PY Rs. 14.80 lakhs) Net Profit increased to Rs. 22.27 lakhs (PY Rs. 10.18 lakhs)

DIVIDEND

The Board has not recommended dividend for the year ended 31^st March, 2023.

TRANFER TO RESERVES

The Board of Directors has decided to retain the entire amount of profit in the profit and loss account. Accordingly, the Company has not transferred any amount to the Reserves for the year ended March 31, 2023.

AUDITORS & AUDITORS REPORT A. Statutory Auditors

M/s. R K Govil & Co., Chartered Accountants, (Firm Registration No.: 000748C) were appointed as statutory auditors of the Company from the conclusion of the 36^th Annual General Meeting (AGM) of the Company held on September 30, 2022 till the conclusion of the 41^st Annual General Meeting to be held in the year 2027.

B. Secretarial Auditors

M/s. Deepak Bansal & Associates, Company Secretaries, were appointed as Secretarial Auditors to conduct Secretarial Audit of the Company for financial year 2022-23. The Secretarial Audit Report is annexed to this Report as Annexure I and forms part of the Annual Report.

C. Cost Audit

In terms of provision of section 148(1) of the Companies Act, 2013 read with rule 4 of the Companies (Cost Records and Audit) Rules, 2014, the Company was not required to maintain cost records for the financial year 2022-23.

D. Internal Auditors

M/s. B.R.Maheswari & Co., Chartered Accountants, (FRN 001035N), were Internal Auditors of the Company for the financial year 2022-23. The Board has continued their appointment, as Internal Auditors of the Company for the financial year 2023-24. EXPLANATIONS OR COMMENTS ON QUALIFICATION, RESERVATION OR ADVERSE REMARKS: a) By Statutory Auditors:

There are no qualifications made by the Auditors in their Report which requires any explanation from the Board of Directors of the Company. The Notes to Accounts referred to in the Auditors Report are self-explanatory and do not call for any further comments. b) By Secretarial Auditors:

There are no qualifications made by Secretarial Auditors in their Report which requires any explanation from the Board of Directors of the Company and hence it is self-explanatory and do not call for any further comments.

CONSERVATION OF ENERGY, TECHNOLOGLY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions of Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of Companies (Accounts) Rules, 2014 regarding conservation of energy, technology absorption and foreign exchange earnings and outgo for the year ended 31^st March, 2023 is annexed to this report as Annexure II and forms part of this report.

PARTICULARS OF EMPLOYEES

The information required under Rule 5 (2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is not required as there was no employee on the payroll of the Company receiving remuneration in excess of limit prescribed under the said rules.

CORPORATE GOVERNANCE

A report on the Companys Corporate Governance practices and the Auditors Certificate on compliance of mandatory requirements thereof forms part of this Report as Annexure III and is also available on the website of the Company at www.modisteel.com

All Board members and Senior Management personnel have affirmed compliance with the Code of Conduct for the year 2022-23. A declaration to this effect signed by the Managing Director (CEO) of the Company is annexed to this Report.

The Managing Director and CFO have certified to the Board regarding the financial statements and other matters as required under regulation 17 (8) of the SEBI Listing Regulations, 2015 and the same forms part of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS

In terms of provision of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, Management Discussion & Analysis Report forms part of this Annual Report and is annexed to this report as Annexure IV and is also available on the website of the Company at www.modisteel.com

DIRECTORS & KEY MANAGERIAL PERSONNEL The Independent Directors of the Company are: Mr. Anirudh Vimalkumar Goenka Mr. Anantshri Gupta Mrs. Sanjana Bharat (upto 14^th February, 2023) Mrs. Kanupriya Gupta (w.e.f. 14^th February, 2023)

In terms of Section 203 of the Act, the following are designated as Key Managerial Personnel of your Company by the Board: Mr. Pawan Kumar Modi, Managing Director cum Chief Financial Officer Mr. Vandana Gupta, Company Secretary

Mrs. Sanjana Bharat, Non-Executive Independent Director of the Company resigned from the Directorship of the Company w.e.f. 14^th February, 2023 and Mrs. Kanupriya Gupta, was appointed as Additional Director designated as Non-Executive Independent Director of the Company with effect from same date. The Board of Directors of the Company has recommended her appointment as Independent Director of the Company in the ensuing Annual General Meeting.

Mr. Anirudh Vimalkumar Goenka and Mr. Anantshri Gupta is completing their first tenure as Independent Director on 29^th March, 2024 and it is proposed to extend their tenure by another five years so as to hold their office upto 29^th March, 2029. The Board of Directors recommends their reappointment as Independent Directors of the Company in the ensuing Annual General Meeting.

In terms of section 152 of the Act and applicable provisions of Articles of Association of the Company, Mr. Vasu Modi, Director retires by rotation and is eligible for re-appointment. The Board recommends his re-appointment as Director of the Company.

The information as required to be disclosed under regulation 36(3) of the SEBI Listing Regulations, 2015 in case of appointment /re-appointment of the directors is provided in the Notice of the ensuing Annual General Meeting.

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received the declaration under section 149(7) of the Companies Act, 2013 from each of the Independent Directors of the Company that he/she meets the criteria of independence as per provision of section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. In the opinion of the Board of Directors, all the Independent Directors are proficient and having expertise and acumen to shoulder the responsibilities conferred on the Independent Directors of the Company.

BOARD MEETINGS & ATTENDACE OF DIRECTORS

During the Financial Year 2022-23, 5 (Five) Board Meetings were held and the gap between two meetings did not exceed four months. The Board Meetings were held on 14.04.2022, 30.05.2022 13.08.2022, 14.11.2022 and 14.02.2023.

EVALUATION OF BOARD, COMMITTEES & DIRECTORS PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has through mutual discussions carried out an annual evaluation of its own performance, the directors individually as well as the evaluation of the working of its committee. The Nomination and Remuneration Committee (“NRC”) evaluated the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was reviewed, taking into account the views of executive directors and non-executive directors of the company.

NOMINATION & REMUNERATION POLICY

The broad terms of reference of the Nomination and Remuneration Committee (“NRC”) of the Company are as under: a) To identify suitable persons, interview them, if necessary, and recommend them as suitable candidates to fill up vacancies on the Board or augment the Board and Senior Management. b) To develop a policy to ensure the optimum composition of the Board of Directors ensuring a mix of knowledge, experience and expertise from diversified fields of knowledge i.e. Policy on Board Diversity. The Policy also intends to add professionalism and objectivity in the process of deciding Board membership. c) To lay down criteria for the evaluation of the Board. d) To formulate a criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a Policy thereon. e) To formulate criteria for evaluation of Directors.

The company has adopted a Nomination and Remuneration Policy as recommended by “NRC” and the objective of Nomination and Remuneration Policy is to ensure rationale and objectivity in the remuneration of the Directors, Senior Management & employees of the Company. The Policy also intends to bring in a pragmatic methodology in screening of candidates who may be recommended to the position of Directors and to establish effective evaluation criteria to evaluate the performance of every Director and the overall Board of the Company. The Policy also serves as a guiding principle to ensure good Corporate Governance as well as to provide sustainability to the Board of Directors of the Company. The Nomination and Remuneration Policy as adopted by your Directors is available at the website of the Company at www.modisteel.com

Matching the needs of the Company and enhancing the competencies of the Board are the basis for the Nomination and Remuneration Committee to select a candidate for appointment to the Board.

The current policy is to have a balanced mix of executive and non-executive Independent Directors to maintain the independence of the Board and separate its functions of governance and management. As at March 31, 2023 the Board of Directors comprised of six Directors, of which three are non-executive, including one women director. The number of Independent Directors is three.

The policy of the Company on Directors appointment, including criteria for determining qualifications, positive attributes, independence of a Director and other matters, as required under sub-section (3) of Section 178 of the Companies Act, 2013, is governed by the Nomination Policy. The remuneration paid to the directors is in accordance with the remuneration policy of the Company.

DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTORS & KEY MANAGERIAL PERSONNEL ETC.

In terms of provision 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, the details of the ratio of the remuneration of each director to the median employees remuneration and such other details as prescribed therein is annexed to this report as Annexure V and forms part of this Annual Report.

RISK MANAGEMENT

The Company has adopted Risk Management Policy to proactively take care of the internal and external risks of the company and ensure smooth business operations. The companys risk management policy ensures that all its material and compliance risk exposures are properly covered, and the companys business growth and financial stability is assured.

ANNUAL SECRETARIAL COMPLIANCE REPORT

The Company has undertaken an audit for the FY 2022 23 pursuant to SEBI Circular No. CIR/CFD/CMO/I/27/2019 dated February 08, 2019 for all applicable compliances as per the Securities and Exchange Board of India Regulations and Circular/ Guidelines issued thereunder. The Report (Annual Secretarial Compliance Report) has been submitted to the Stock Exchanges on May 30, 2023 which is within 60 days of the end of the financial year ended March 31, 2023.

SECRETARIAL STANDARDS

Your Company has complied with the applicable Secretarial Standards issued by the Institute of Companies Secretaries of India during the year.

EXTRACT OF ANNUAL RETURN

The Annual Return of the Company for the year ended on 31^st March, 2023 has been uploaded on the website of the Company. It can be accessed under Investor Relations page at website of the Company i.e. www.modisteel.com

FRAUD REPORTING

Neither the Statutory Auditors nor the Secretarial Auditors have brought to the notice of the Audit Committee or the Board of Directors or the Central Government the occurrence or brewing of any fraud in the Company.

INTERNAL FINANCIAL CONTROLS

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee and the Board.

CODE OF PRACTICES AND PROCEDURES FOR FAIR DISCLOSURE OF UNPUBLISHED PRICE SENSITIVE INFORMATION

Your Company has adopted the “Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information” which, inter alia, prohibits purchase or sale of securities of the Company by Directors, employees and other connected persons while in possession of unpublished price sensitive information in relation to the Company. The Code requires pre-clearance for dealing in the Companys shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

WHISTLE BLOWER/VIGIL MECHANISM

Your Company has an effective Vigil Mechanism system which is embedded in its Code of Conduct to report to the management instances of unethical behaviour, actual or suspected, fraud or violation of the Companys code of conduct or ethics policy. The Code of Conduct of your Company serves as a guide for daily business interactions, reflecting your Companys standard for appropriate behavior and living Corporate Values. The Vigil Mechanism provides a mechanism for employees of the Company to approach the Chairman of the Audit Committee of the Company.

CHANGE IN NATURE OF BUSINESS

There was no change in the nature of business of your company during the year.

CHANGE IN SHARE CAPITAL

There was no change in the Share Capital of your company during the year.

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments which can affect the financial position of the company between the end of the period under review and date of this report.

DEPOSITS FROM PUBLIC

During the year under review, your Company did not invite / accept any Deposits from the public under section 73 and 74 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 1975.

DETAILS OF SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary Company, Associate Company or Joint Venture Company. The Company is not a Subsidiary Company of any other Company.

PARTICULARS OF CONTRACTS OR ARRANGMENTS WITH RELATED PARTY

All related party transactions done by the Company during the financial year were at arms length and in ordinary course of business. All related party transactions were placed in the meetings of Audit Committee and the Board of Directors for their necessary review and approval. During the financial year your Company has not entered into any material transaction as mentioned in the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 with any of its related parties which may have potential conflict with the interest of the Company at large. Disclosures pursuant to Accounting Standards on related party transactions have been made in the note no. 26 to the Financial Statements.

PARTICULARS OF LOAN, GUARANTEES, SECURITIES AND INVESTMENTS

The Company has not given any loan, guarantee or provided any security under Section 186 of the Companies Act, 2013.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL

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

PROCEEDING UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016

There are no proceedings initiated /pending against your Company under the Insolvency and Bankruptcy Code, 2016.

ONE TIME SETTLEMENT

There is no instance of one time settlement with any Bank or Financial Institution.

CORPORATE SOCIAL RESPONSIBILITIES

The provision of section 135 of the Companies Act, 2013 is not applicable on the Company as your Company did not meet any of the applicability criteria as specified under Companies (Corporate Social Responsibility Policy) Rules, 2014.

DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE, (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

In accordance with the provision of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 the Company has adopted a policy for prevention of Sexual Harassment of Women at workplace and has set up Committee for implementation of said policy. Hence, the company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year Company has not received any complaint of harassment.

GREEN INITIATIVE

As a responsible corporate citizen, the Company welcomes and supports the ‘Green Initiative taken by the Ministry of Corporate Affairs, Government of India (MCA), by its recent Circulars, enabling electronic delivery of documents including the Annual Report to shareholders at their e-mail address registered with the Depository Participants(DPs)/Company/Registrars & Share Transfer Agents.

Shareholders who have not registered their e-mail addresses so far are requested to register their e-mail addresses. Those holding shares in DEMAT form can register their e-mail address with their concerned DPs. Shareholders who hold shares in physical form are requested to register their e-mail addresses with Skyline Financial Services Pvt. Ltd., by sending a letter duly signed by the first/sole holder quoting details of Folio Number.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, your Directors in respect of the Audited Annual Accounts for the year ended 31^st March, 2023, to the best of their knowledge and ability, hereby state that : (i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) 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 ended on March 31, 2023 and of the profit of the Company for the year ended on that date; (iii) They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) They have prepared the annual accounts on a going concern basis. (v) They have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. (vi) They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

APPRECIATION & ACKNOWLEGEMENT

Your Directors take this opportunity to express their appreciation for the co-operation and assistance received from the Central Government, the State Government, the Financial Institutions, Banks as well as the Shareholders during the year under review. Your Directors also with the place on record their appreciation of the devoted and dedicated service rendered by all the employees of your Company.