Rama Steel Tubes Ltd Directors Report.

To the Members,

The Directors submit annual report of the Rama Steel Tubes Limited (the "Company" or "RAMA") along with the audited financial statements for the financial year ended March 31, 2021.

FINANCIAL RESULTS

(Rs.in Lakhs)

Particulars

Standalone

Consolidated

2020-21

2019-20

2020-21

2019-20

Revenue from operations

32571.00

29,176.13

47,043.45

35,280.90

other Income

312.47

472.34

613.89

365.06

total Revenue

32,883.47

29,648.47

47,657.34

35,645.96

EBIDTA

1413.81

1064.95

2446.16

1232.15

Finance Costs

610.22

80706

769.78

963.14

Depreciation and Amortisation expenses

265.74

221.78

346.17

290.09

Share of profits from Associates and JVs

140.44

232.39

140.44

232.9

Net Profit before Tax

678.29

268.50

1470.65

211.31

tax expenses

140.47

131.23

232.83

168.67

Net Profit after Tax

537.82

137.28

1237.81

42.64

other Comprehensive Income

6.56

(-) 0.84

(-) 26.17

39.24

Total Comprehensive Income

544.38

136.44

1211.64

81.88

Earning per equity share (Face Value of Rs.5 each)
Basic

3.24

0.81

7.21

0.49

Diluted

3.24

0.81

7.21

0.49

COMPANYS PERFORMANCE

The business performance of the company during the financial year 2020-21 was very strong, exhibited stellar performance amidst a dampening environment globally. The Company was able to perform through its operational excellence, better price realization, higher efficiency, effective cost management practices and well executed strategies.

During FY 2020-21, your company achieved Consolidated Revenue from operations of 47043.45 Lakhs compared to Rs.35280.90 in FY20, registering a growth of 32% over the last year.

Earnings before Interest, Depreciation and taxes (EBIDTA) stood at Rs.2446.16 Lakhs in FY 2020-21 compared to Rs.1232.15 Lakhs in FY 2019-20. Compared to the previous fiscal, EBIDTA enhanced by 98.53%.

Consolidated profit before tax (PBT) in FY 2020-21 was Rs.1470.65 Lakhs compared to Rs.211.31 Lakhs in last FY 20, reflecting an increase of 595.97%.

Consolidated profit after tax (PAT) for the year under review was Rs.1237.81 Lakhs against Rs.42.64 Lakhs in FY 2020-21, an increase of 2803 % over the last fiscal year.

BUSINESS IMPACT OF COVID-19

In the first quarter of the financial year 2020-21, the COVID-19 pandemic had an adverse impact across regional and global economies and financial markets. Most governments reacted by instituting lockdowns, business shutdowns, quarantines and restriction on travel. Businesses also implemented safety measures to reduce the risk of transmission. Such action led to disruption of economic activity, leading to many economies encountering a deep slump. However, end of Lockdowns and resumption of economic activity from second quarter onwards, consumption picked up.

The company did face some operational disruptions in the beginning of FY 2020-21, which impacted the business. However, it was agiLe enough to work on a mitigation pLan to overcome the challenges and combat the impact of the economic slowdown induced by the pandemic. It made all possible efforts to ramp up capacity utilisation and resume near-normal run rates by the end of the first quarter of FY 2020-21. In second quarter, the Company focused on increasing sales volumes to offset the loss of sales volumes of first quarter.

As long term plan, the company also identified key focuses areas to ensure seamless business continuity. one such area is digitalisation, which it will continue to leverage by undertaking digital initiatives, using digital tools to access markets, and digital platforms to ensure operational excellence. It will also reduce its cost base and maintain continuity of its supply chains. Most importantly, it will remain committed to its environmental, social and governance goals.

DIVIDEND

The Board does not recommend any dividend for the year under review.

ADOPTION OF INDIAN ACCOUNTING STANDARDS (IND AS)

The Company has adopted Indian Accounting Standards (Ind AS). Accordingly, the standalone financial statements of the Company and the consolidated financial statements of the Company with its subsidiary for the financial year ended March 31, 2021, have been prepared in accordance with Ind AS as prescribed under section 133 of the Companies Act, 2013 (the "Act"), read with the relevant rules made there under and other accounting principles generally accepted in India.

EQUITY SHARE CAPITAL

The issued, subscribed and paid-up equity share capital of the Company is Rs.8,39,70,000 divided into 1,67,94,000 Equity shares of 5/- each.

MANAGEMENTS DISCUSSION AND ANALYSIS REPORT

Managements Discussion and Analysis Report for the year under review, is presented in a separate section forming part of this Annual Report.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATES

The Company has 2 Direct subsidiaries and 1 Indirect subsidiary and 1 JV as on March 31, 2021. Pursuant to Section 129 of the Companies Act, 2013 a statement in prescribed Form AoC-1, relating to subsidiaries and joint venture for the year ended on March 31, 2021 has been attached with the consolidated financial statements of the Company for the financial year ended March 31, 2021. In accordance with provisions of Section 136 of the Companies Act, 2013 the standalone and consolidated financial statements of the company, along with relevant document and separate audited accounts in respect of the subsidiaries, are available on the website of the company. The company will provide the annual accounts of the subsidiaries and related detailed information to the shareholders of the Company on specific request made to it in this regard by the shareholders.

The policy for determining material subsidiaries as approved may be accessed on the Companys Website:http:// www.ramasteel.com/app/webroot/img/uploads/files/93/ POLICY%20FOR%20DETERMINING%20MATERIAL%20 SUBSIDIARY.pdf

Lepakshi Tubes Private Limited, a wholly owned subsidiary of Rama Steel tubes Limited is the material subsidiary of the Company as per Listing regulations.

The provisions of Regulation 24(1) of the listing Regulations, appointment of one of the Independent Directors of the Company on the Board of material subsidiaries are not applicable to Lepakshi Tubes Private Limited.

The Company is in compliance with Regulation 24A of the Listing Regulations. The Companys unlisted material subsidiary Lepakshi Tubes Private Limited undergo Secretarial Audit. Copy of Secretarial Audit Report of is available on the website of the Company. The Secretarial Audit report of Lepakshi Tubes Private Limited does not contain any qualification, reservation or adverse remark or disclaimer.

SECRETARIAL STANDARDS

The Company has followed applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to Meetings of the Board of Directors and General Meetings respectively.

PUBLIC DEPOSITS

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. Accordingly, there are no unclaimed or unpaid deposits lying with the Company for the year under review.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Charat Sharma was appointed as Additional Director (Non-executive Independent Director) by the Board of Directors of the Company w.e.f. November 17, 2019 has resigned from Board of Directors of the company due to personal reason w.e.f. September 4, 2020.

Mr. Jai Prakash Gupta was appointed as Additional Director (Non-executive Independent Director) by the Board of Directors of the Company w.e.f. September 4, 2020 who holds office up to the ensuing Annual General Meeting.

Mr. Vinod Pal Singh Rawat was appointed as Additional Director (Executive Director) by the Board of Directors of the Company w.e.f. July 8, 2021 who holds office up to the ensuing Annual General Meeting.

As per the provisions of the Companies Act 2013 and the Articles of Association of the Company, Mr. Richi Bansal, Director of the Company will be retiring by rotation at the ensuing AGM and being eligible has offered himself for reappointment.

The details pursuant to Regulation 36(3) of the SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015 relating to appointment and re-appointment of directors at the AGM are provided in the Notice to the members.

Key Managerial Personnel:

The Key Managerial personnel (KMp) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

*Mr. Naresh Kumar Bansal, Managing Director

*Mr. Rajeev Kumar Aggarwal, Chief Financial Officer

*Mr. Kapil Datta, Company Secretary

DIRECTORS RESPONSIBILTY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure;

b) that the selected accounting policies were applied consistently. Reasonable and prudent judgments and estimates were made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the loss of the Company for the year ended on that date;

c) the directors had 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;

d) that the annual accounts have been prepared on a going concern basis;

e) the directors had laid down internal financial controls to be followed by the Company and such internal financial control are adequate and were operating effectively; and

f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and were operating effectively.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION AND OTHER DETAILS

The current policy is to have an appropriate mix of executive and independent directors to maintain the independence of the Board, and separate its functions of governance and management. As on March 31, 2021, the Board consist of 6 members, three of whom are executive and three are independent directors. The Board periodically evaluates the need for change in its composition and size.

The policy of the Company on directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub-section (3) of Section 178 of the Companies Act, 2013, adopted by the Board. We affirm that the remuneration paid to the directors is as per the terms laid out in the nomination and remuneration policy of the Company.

DECLARATION BY INDEPENDENT DIRECTOR(S)

All the Independent Directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149 (6) of the Companies Act, 2013 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

CORPORATE GOVERNANCE REPORT

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The Company has also implemented several best corporate governance practices as prevalent globally. The report on Corporate Governance as stipulated under the Listing Regulations forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

ANNUAL RETURN

In accordance with provisions of Section 134(3)(a) of the Companies Act, 2013, the annual return as required under Section 92 of the Act for the financial year 2020-21, is available on the Companys website at www.ramasteel. com.

NuMBER OF MEETINGS OF THE BOARD

Eight meetings of the board were held during the year.

For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report.

CONTRACTS AND ARRANGEMENT WITH RELATED pARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

Your Directors draw attention of the members to Note 48 to the Standalone financial statement which sets out related party disclosures. The particulars of contracts and arrangements entered into by the company with related parties referred to in Section 188 in Form AoC-2 is attached herewith as Annexure- I.

AUDITORS AND AUDITORS REPORT

Statutory Auditors

As per provisions of Section 139 of the Companies Act, 2013, the Company has appointed M/s Alok Mittal & Associates, Chartered Accountants (Firm Registration No. 005717N) as Statutory Auditors for a period of 5 (five) years in the AGM of the Company held on 29th September 2018.

The requirement to place the matter relating to appointment of auditors for ratification by Members at every AGM has been done away by the Companies (Amendment) Act, 2017 with effect from May 7, 2018. Accordingly, no resolution is being proposed for ratification of appointment of statutory auditor at the ensuing AGM.

The Auditors Report to the shareholders on the standalone and consolidated financial statement for the year ended March 31, 2021 does not contain any qualification, observation or adverse comment.

Secretarial Auditors

Pursuant to the provision of Section 204 of the Act, read with Rule 9 of the Companies (Appointment and Remunerartion of Managerial personnel) Rules, 2014 the Board of Directors had appointed M/s Arun Kumar Gupta & Associates (CP No. 5086), Company Secretaries, to conduct Secretarial Audit for the financial year ended March 31, 2021. The Secretarial Audit Report for the financial year ended March 31, 2021 is annexed herewith marked as Annexure - II to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Pursuant to Regulation 24(A) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, the Company has obtained annual secretarial compliance report from M/s Arun Kumar Gupta & Associates (CP No. 5086), Company Secretaries, and same will be submitted to the stock exchange within the prescribed time limits. The Annual Secretarial Compliance Report does not contain any remarks or observations.

Cost Auditors

Pursuant to the provision of Section 148(3) of the Act, the Board of Directors had appointed M/s. Subodh Kumar & Co., Cost Accountants, for conducting the audit of cost records of the Company for Steel pipe Segment for the financial year ended March 31, 2021. The audit is in progress and report will be filed with the Ministry of Corporate Affairs within the prescribed period.

The cost records as specified by the Central Government under sub-section (1) of Section 148 of the Act as required by the Company are maintained by the Company.

Details in respect of frauds reported by Auditors other than those which are reportable to the Central Government

The Statutory Auditors, Cost Auditors or Secretarial Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors under Section 143(12) of the Companies Act, 2013, including rules made thereunder.

LOANS, GUARANTEES AND INVESTMENTS

The particulars of loans, guarantees and investments given under Section 186 of the Companies Act, 2013 have been disclosed in the financial statements.

CORPORATE SOCIAL RESPONSIBILITY

We at RAMA aim to create economic value and to actively contribute toward the development of a sustainable society by taking up projects for the common good through responsible business practices and good governance. In line with the requirement of Section 135 of the Companies Act 2013 your Company having a Corporate Social Responsibility Committee. The details of Committee and the terms of reference are provided in corporate governance report. The CSR Policy of the Company is available on its website at the link: http://ramasteel.com/ cms/policy-and-code-of-conduct.

During the year the Company has spent Rs.19.95 Lakhs on CSR activities for the financial year 2020-21 as annexed herewith Annexure- III to this Report.

Aforesaid CSR money paid to Konfyans Charitable public trust for purpose of women empowerment and social development.

INTERNAL FINANCIAL CONTROL

The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

VIGIL MECHANISM AND WHISTLE BLOWER POLICY

Fraud-free and corruption free work culture has been the core of the Companys functioning. In view of the potential risk of fraud and corruption due to rapid growth and geographical spread of operations, the company has put even greater emphasis to address the risk.

To meet this objective, a Whistle Blower policy has been laid down. The same policy is approved by the Board was uploaded on the Companys website (www.ramasteel.com).

DISCLOSuRE uNDER SEXuAL HARASSMENT OF WOMEN AT WORKpLACE (pREVENTION, pROHIBITION AND REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in Line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. No complaint has been received for sexual harassment of women at work place by the Company during the financial year 2020-21.

BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Companies Act, 2013 and Corporate Governance requirements as prescribed by SEBI (Listing obligations and Disclosure Requirements) Regulations, 2015.

PARTICULARS OF EMPLOYEES RELATED DISCLOSURES

a. Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014 are given below :

i. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Non-executive directors

Ratio to median remuneration

Mr. Bharat Bhushan Sahny

N.A.

Mr. Charat Sharma (upto 04.09.2021)

N.A.

Mr. Jai Prakash Gupta (w.e.f. 04.09.2021)

N.A.

Mrs. Anju Gupta

N.A.

Executive directors
Mr. Naresh Kumar Bansal

21.00

Mr. Richi Bansal

19.00

Mr. Surender Kumar Sharma

1.00

 

ii. The percentage increase in remuneration of each director, chief executive officer, chief financial officer, company secretary in the financial year:

Directors, Chief Financial Officer and Company Secretary

% increase in remuneration in the financial year

Mr. Bharat Bhushan Sahny

N.A.

Mr. Charat Sharma (upto 04.09.2021)

N.A.

Mr. Jai Prakash Gupta (w.e.f. 04.09.2021)

N.A.

Mrs. Anju Gupta

N.A.

Mr. Naresh Kumar Bansal, Managing Director

NIL

Mr. Richi Bansal, Executive Director

NIL

Mr. Rajeev Kumar Agarwal, Chief Financial Officer

NIL

Mr. Kapil Datta, Company Secretary

NIL

b. The percentage increase in median remuneration of employees in the financial year: NIL

c. The number of permanent employees on the rolls of Company : 85

d. Variations in the market capitalisation of the Company, price earning ratio as at the closing date of the current financial year and previous financial year : N.A.

e. Percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer: N.A.

f. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

The average annual increase was NIL

Increase in the managerial remuneration for the year was NIL

g. The Company affirms that the remuneration is as per remuneration policy of the Company.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014, there is no such employee drawing remuneration in excess of the limits set out in the said rules and are required to be disclosed.

Further, particulars of employees pursuant to Rule 5(2) & 5(3) of the above rules form part of this report. However in terms of provisions of section 136 of the said Act, the report and accounts are being sent to all the members of the Company and others entitled thereto, excluding the said particulars of employees. Any member interested in obtaining such particulars may write to the Company Secretary at investors@ ramasteel.com. The said information is available for inspection at the Registered Office of the Company during working days of the Company upto the date of the ensuing AGM.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A) CONSERVATION OF ENERGY :

a) The Company has always been particular to conservation of energy on continuous basis by closely monitoring energy consuming equipment involving use of energy generating diesel set and power purchased from Electricity Board e.g. size of the Equipments is optimum to save energy. The low-efficient Machinery and Equipments are identified and replaced.

b) Keeping in view the nature of the manufacturing process no additional investment is proposed and hence further consumption of energy is ruled out in the near future.

c) No specific studies regarding impact of the above measures of (a) and (b) have been carried out and the cost impact of energy cost and energy saving measures on cost of production of goods is not material, as it forms a very low percentage vis-a vis the cost of Companys product.

d) Total energy consumption and energy consumption per unit of production is given as per Form-A.

B) TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION :

I. RESEARCH AND DEVELOPMENT (R&D)

i. Specific area in which R & D carried out by the Company :

There is no specific area in which the Company has carried the R & D. However, the Company is continuously making efforts for improvements in its production process for better productivity and cost efficiency.

ii. Future plan of action

The Company plans to monitor continuously the plant efficiency thus reducing the shortage and reducing the cost of production.

iii. Expenditure on R & D

The company did not incur any Expenditure on R & D.

II. TECHNOLOGICAL, ABSORPTION, ADAPTATION & INNOVATION :

i. Efforts made towards Technology Absorption:

For the goods manufactured by the Company there is a simple process of ERW manufacturing technique and the Company has already adopted the same and no innovations have been carried by the company, as there is no other available alternative that would ensure further cost efficiency.

ii. Particulars relating to imported technology :

The Company has not imported any technology and the plant is working with completely Indigenous Technical know-how.

C) FOREIGN EXCHANGE EARNING AND OUTGO :

(Rs.in Lacs)

Current year

previous year

a) Total Foreign Exchange Earning

5645.78

4700.41

b) total Foreign exchange outgo

3567.06

3010.26

 

FORM A

POWER AND FUEL CONSUMPTION

Current Year

previous year

1. Electricity
(a) purchased unit

2910254

3666641

Total amount (in Rs)

2,19,88,311

2,26,95,286

Rate/unit

756

6.19

(b) own generation
Through Diesel Generator Unit

79049

114990

unit per litre of Diesel oil

4.73

4.78

Total Amount (in Rs)

12,48,133

15,73,659

Cost/unit

15.73

13.69

2. Furnace oil Quantity(litres)

195150

140560

Total Amount (in Rs)

69,37,350

59,64,800

Average Rate Rs/litre

35.55

42.44

 

CONSUMPTION PER UNIT OF PRODUCTION

ELECTRICITY (UNIT)

FURNACE OIL/GAS (LITRE/SQ. CUBIC MTR)

NAME OF PRODUCT UNIT

CURRENT YEAR

PREVIOUS YEAR

CURRENT YEAR

PREVIOUS YEAR

Black Steel Tubes/pipes per Ton

54.35

60.96

-

--

Galvd. Steel Tubes/pipes per Ton

52.91

59.11

14.43

12.66

 

ACKNOWLEDGEMENT

The Directors acknowledge the contributions made by the employees towards the success and growth of the company. Your Directors also take this opportunity to express sincere thanks to the Government Authorities, Financial Institutions and the Bankers for their co-operation and assistance to the Company. The Directors would also like to acknowledge the continued support of the Companys shareholders in all its endeavors.

For and on behalf of Board of Directors

Sd/-

place: New Delhi

(Naresh Kumar Bansal)

Date: August 14, 2021

Chairman & Managing Director