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Your Directors take pleasure in presenting the Twenty Ninth Annual Report together with the Audited Financial Statements of your Company for the financial year ended March 31, 2019.
(Rs. in Lakhs)
|Expenses excluding Interest and Depreciation & Amortization||5437.06||2670.85|
|Profit for the year before Interest, Depreciation & Amortization||716.43||261.41|
|Less : Interest Cost for the year||78.57||68.82|
|Less : Depreciation & Amortization||121.78||116.32|
|Gross Profit for the year||516.08||76.27|
|Less : Exceptional Items||125.91||-|
|Profit for the year after Exceptional Items||390.17||76.27|
|Add/(Less) Provision for Income Tax||(82.15)||(13.35)|
|Add/(Less) Deferred Tax||(99.84)||(20.40)|
|Net Profit for the period||208.18||42.52|
In view of proposed expansion plans and working capital requirements of the Company, your Directors do not recommend a Dividend for the financial year ended March 31, 2019.
CHANGE IN THE NATURE OF BUSINESS, IF ANY:
During financial year 2018-19, there was no change in the nature of Companys business.
There was no change in the authorized as well as paid up share capital of the Company during the year under review.
The current Authorized Capital of the Company is Rs. 13,25,00,000/- divided into 1,25,00,000 Equity shares of Rs. 10/- each and 7,50,000 4% Non-Cumulative Redeemable Preference Shares of Rs. 10/- each and Paid-up Capital of the Company is Rs. 10,93,94,000/- divided into 1,09,39,400 Equity Shares of Rs. 10/- each.
TRANSFER TO RESERVES:
During the year, the Company has not transferred any amount to General Reserves.
OPERATIONS AND STATE OF AFFAIRS:
During the financial year under review, Company registered a total revenue from operations Rs. 6141.10 Lakhs as against Rs. 2917.30 Lakhs in the previous year. Export sales were marginally lower from Rs. 136.01 Lakhs achieved in previous year to Rs. 132.93 Lakhs. With the Companys focus on growth and cost reduction efforts has helped the Company to earn profit of Rs. 204.73 Lakhs for the year ended March 31, 2019 as against net profit ofRs. 36.29 Lakhs in the previous year.
The affairs of the Company are functioning smoothly and appropriately in compliance with all the applicable laws and regulations.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
Your Company is not having net worth of Rupees Five Hundred Crores or more, or turnover of Rupees One Thousand Crores or more or a Net Profit of Rupees Five Crores or more during any financial year. As such, the provisions of Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable to the Company.
In view of the above, no provision for CSR activity have been made during the financial year 2018-19.
The Company has set up vigil mechanism viz. Whistle Blower Policy to enable the employees and Directors to report to the Audit Committee Chairman, genuine concerns, unethical behavior and irregularities, if any, noticed by them in the Company, which could adversely affect companys operations. This mechanism also provides safeguards against victimization of employees, who avail of the mechanism. The details of the same are explained in the Corporate Governance Report and also posted on the website of the Company at http://www.rkforging.com/wp-content/uploads/2017/04/ WHISEL-BLOWER-POLICY-1.pdf. All Directors and employees have access to the Chairman of the Audit Committee. The policy with the name and address of Chairman of the Audit Committee has been circulated to the employees. Further no personnel have been denied access to the Audit Committee during the period under review.
Your Company has not accepted any deposits from the public falling within the purview of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.
DETAILS OF BOARD MEETINGS:
The Board met 8 times during the financial year. The meeting details are provided in the Corporate Governance Report that forms part of this Annual Report. The maximum gap between any two meetings did not exceed 120 days, as prescribed under the Companies Act, 2013.
COMMITTEES OF THE BOARD:
As on March 31, 2019, the Board had five Committee, the Nomination and Remuneration Committee, the Stakeholder Relationship Committee, the Share Transfer Committee and the Committee for issue of Duplicate Share Certificate. The detailed note on composition of the Board and its committees is provided in the Corporate Governance annexure to this Report.
DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received necessary declarations from each Independent Director under Section 149(7) of the Companies Act, 2013, that he / she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
RE-APPOINTMENT OF DIRECTOR:
As per the provisions of Companies Act, 2013, Mr. Arun Jindal, retires by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. The Board recommends his reappointment.
DIRECTORS AND KEY MANEGERIAL PERSONNEL:
The details of Directors and Key Managerial Personnel are as follows:
|1||Mr. Arun K. Jindal||Non-Executive Director|
|2||Mr. Nitin Rajore||Whole Time Director|
|3||Mr. R. T. Goel||Non-Executive Director|
|4||Ms. Sudha Santhanam||Non-Executive Director|
|5||Mr. Shubham Jindal||Chief Financial Officer|
|6||Ms. Shruti Patil||Company Secretary|
SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANY:
The Company does not have any subsidiary, joint venture and associate company during the year under review.
FORMAL ANNUAL EVALUATION:
Pursuant to the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and as per the guidance note issued by SEBI on January 05, 2017, a formal evaluation of the performance of the Board, its Committees, the Chairman and the individual Directors was carried out for financial year 2018-19. Led by the Nomination & Remuneration Committee, the evaluation was carried out using individual questionnaires covering, amongst others, composition of Board, conduct as per Company values & beliefs, contribution towards development of strategy & business plan, risk management, receipt of regular inputs and information, codes & policies for strengthening governance, functioning, performance & structure of Board Committees, skill set, knowledge & expertise of Directors, preparation & contribution at Board meetings, leadership etc.
Manner in which the evaluation has been carried out and matters incidental thereto, have been detailed in the Report on Corporate Governance, which forms part of this report.
COMPANYS POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF A DIRECTOR:
The Company has adopted the Guidelines on Board Effectiveness ("Governance Guidelines" or "guidelines") which inter-alia cover the criteria for determining qualifications, of a Director. The details of the Policy are stated in the Corporate Governance Report.
RELATED PARTY TRANSACTIONS:
The information for related party transactions as required under Rule 8(2) of the Companies (Accounts) Rules, 2014 in Form AOC-2 is enclosed as Annexure A to this Report. The policy on Related Party Transaction as approved by the Board has been displayed on the Companys website at http://www.rkforging.com/wp-content/ uploads/2017/05/RELATED-PARTY-TRANSACTION-POLICY.pdf There has been no change to the policy of Related Party Transaction during the financial year ended March 31, 2019
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND:
a. The sum of Rs. 8,76,800 /- being the amount of unpaid or unclaimed dividend for a period of seven years was transferred during the financial year 2018-19 to the Investor Education and Protection Fund established by the Central Government in compliance with Section 124 of the Companies Act, 2013.
b. During the year under review, the Company has transferred 48,101 shares to the Investor Education and Protection Fund in accordance with the provisions of Section 124 of the Companies Act, 2013 and Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF Rules).
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:
There were no loans, guarantees and investments made by the Company under Section 186 of the Companies Act, 2013 during the period under review.
The Company has not accepted deposits under Chapter V of the Companies Act, 2013 during the year under review. No amount on account of principal or interest on deposit from public was outstanding as on March 31, 2019.
INTERNAL FINANCIAL CONTROLS:
The internal financial controls with reference to the Financial Statements are commensurate with the size and nature of business by virtue of internal audit of the Company. Internal Audits are periodically conducted by an external firm of Chartered Accountants who monitor and evaluate the efficiency and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies of the Company. Board also take quarterly review of internal audit functioning and accounting systems, in order to take suitable corrective actions in case of any deviations. During the year, such controls were tested and no material weakness in their design of operations were observed.
CORPORATE GOVERNANCE CERTIFICATE:
In terms of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the report on Corporate Governance along with the Compliance certificate from the Secretarial Auditor forms part of this Report.
EXTRACT OF ANNUAL RETURN:
Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of Companies (Management and Administration) Rules, 2014, the extract of Annual Return in Form MGT 9 is annexed as an Annexure B to this Report.
MATERIAL CHANGESAND COMMITMENTS, IFANY,AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
No material change and/or commitment affecting the financial position of your Company has occurred between April 1, 2019 and the date of signing of this Report. attributes and independence
AUDITORS: Statutory Auditors
M/s. Gokhale Tanksale & Ghatpande, Chartered Accountants, Pune (Firm Registration No. 103277W) was appointed as the Statutory Auditors of the Company to hold office for a period of 5 consecutive years from the conclusion of 27th Annual General Meeting of the Company held on September 27, 2017 till the conclusion of the 32nd Annual General Meeting of the Company to be held in financial year 2022-23.
Vide notification dated May 7, 2018 issued by Ministry of Corporate Affairs, the requirement of seeking ratification of appointment of statutory auditors by members at each Annual General Meeting has been done away with. Accordingly, the shareholders at their 28th Annual General Meeting had given their consent to continue the appointment of M/s. Gokhale, Tanksale & Ghatpande, Chartered Accountants (Firm Registration No. 103277W) as Statutory Auditors of the Company for the remaining of term without any further ratification by the members in terms of the provisions of the Companies Act, 2013.
The Statutory Auditors Report for Financial Year 2018-19 on the financial statement of the Company forms part of this Annual Report. There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their audit report on the financial statements for the year ended March 31, 2019. The observations of the Statutory Auditors in their Report are self-explanatory and therefore Directors dont have any further comments to offer on the same.
Pursuant to Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors have appointed Mr. Gaurav Nashikkar, Practicing Company Secretary (CP No. 13967) for conducting the Secretarial Audit of the Company for the financial year 2018-19.
The Report of the Secretarial Audit is annexed herewith as an Annexure C to this Report.
Pursuant to recent amendments in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI circular No. LIST/ COMP/14/2018 dated June 20, 2018, a certificate from Gaurav Nashikkar, Company Secretary in practice that none of the Directors on the Board of the Company have been debarred or disqualified from being appointed or continuing as directors of companies by the SEBI / Ministry of Corporate Affairs or any such statutory authority is annexed to Corporate Governance Report.
COST RECORDS AND / OR COST AUDIT:
Your Company does not fall under provisions of Section 148 of the Companies Act, 2013 read with Companies (Cost Record and Audit) Rules, 2014. Therefore, no such records were required to be maintained.
REPORTING OF FRAUDS BY AUDITORS:
During the year under review, neither the Statutory Auditors nor the Secretarial Auditor has reported to the Audit Committee, under Section 143 (12) of the Companies Act, 2013, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Boards report.
EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE STATUTORY AUDITORS IN THEIR REPORTS:
There were no qualifications, reservations or adverse remarks made by the Statutory Auditors in their report.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:
There are no significant and material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.
The details of Risk Assessment framework are set out in the Corporate Governance Report forming part of the Boards Report.
DISCLOSURE UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION), RULES, 2014:
The information required pursuant to Section 197 Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration), Rules, 2014 in respect of employees of the Company and Directors is attached as an Annexure D.
Information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2)(i) to (iii) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not provided herein, since there are no employee who have received remuneration in excess of the limits prescribed therein.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are annexed herewith as Annexure E to this report.
COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company is compliant with the applicable Secretarial Standards (SS) viz. SS-1 & SS-2 on Meetings of the Board of Directors and General Meetings respectively.
POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE:
Your Company has adopted policy on prevention, prohibition and redressal of sexual harassment at work place, in line of the provisions of the Sexual Harassment of women at work place (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. The policy aims to provide protection to employees at the work place and to prevent and redress complaints of sexual harassment and for matters connected and incidental thereto, with an objective of providing a safe working environment where employees feel secured. The company has not received any complaints during the financial year 2018-19.
DIRECTORS" RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 134 (5) of the Companies Act, 2013 with respect to Directors Responsibility Statement, your directors confirm:
1. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
2. that we 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 loss of the Company for that period;
3. that we had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
4. that we had prepared the annual accounts on going concern basis;
5. and that we had laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively;
6. that we had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
We thank our customers, vendors, investors, bankers and employees for their continued support during the year. We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.
|For and on behalf of the Board of Directors|
|RAJKUMAR FORGE LIMITED|
|Place : Pune||Chairman|
|Date : July 17, 2019||DIN : 00121523|