Rolcon Engineering Company Ltd Directors Report.

TO,

THE MEMBERS OF

ROLCON ENGINEERING CO. LTD.

Your Directors takes pleasure in presenting the 54th Annual report together with the Audited Financial Statements (consolidated & standalone) and Auditors Report for the financial year ended March 31, 2021. The financial highlights for the year under review are given below:

(Amt. in Lakh)

Particulars Standalone Consolidated
F. Y. 2020-21 F. Y. 2019-20 F. Y. 2020-21 F. Y. 2019-20
Revenue 2556.14 3627.50 2556.14 3627.50
Other Income 55.97 59.29 55.97 59.29
Total Income 2612.11 3686.79 2612.11 3686.79
Expenses
Operating Expenditure 2451.56 3504.86 2451.56 3504.86
Depreciation and amortisation Expenses 60.89 92.12 60.89 92.12
Total Expenses 2512.45 3596.98 2512.45 3596.98
Profit Before Finance Cost and Tax 99.66 89.81 99.66 89.81
Finance Cost 5.81 5.78 5.81 5.78
Share of Profit/Loss of Associates 0 0 -1.51 0
Profit Before tax (PBT) 93.85 84.03 92.34 84.03
Tax Expenses 36.49 34.73 36.49 34.73
Profit After Tax (PAT) 57.36 49.30 55.85 49.30
Other Comprehensive income
-Re-measurements of the defined benefit plans -7.17 0 -7.17 0
-Equity instruments through other comprehensive income 21.49 0 21.49 0
Profit For the year 71.68 49.30 70.17 49.30
Attributable to:
Shareholders of the Company 71.68 49.30 70.17 49.30
Opening Balance of retained Earning 418.56 379.26 418.56 379.26
Closing Balance of retained Earing 473.91 418.56 472.39 418.56
Equity share capital 75.60 75.60 75.60 75.60
Reserve 1088.07 1027.73 1086.56 1027.73
EPS (in Rs.) 9.48 6.52 9.28 6.52

Disclosure of Material impact of COVID-19 pandemic

The novel coronavirus (COVID-19) pandemic has been spreading around the world rapidly. Moreover, second wave of pandemic has serious impact in India. The Virus has not just affected the human, but business of almost all industries, the scope of which currently is undetermined.

The management has made the assessment of possible impact of Covid-19 in first and Second Quarter of the F.Y 202021 on its liquidity & Financials and has conclude that there was some significant Impact on Production and Function of Registered Office, Sales & Revenue, Demand & Supply, Liquidity crunches, Trade receivables etc.

However, Company has adequate liquidity and having no such major debt therefore, Management expects no such extraordinary impact and least adjustment requisite in the financial results of F.Y. 202021. Further the management will continue to closely monitor the developments and possible impact of second wave of COVID- 19, if any, on its. Financial Condition, Liquidity and operation.

Additionally, Company has given Disclosures under Regulation 30(3) and para B of Part A of Schedule III of SEBI (LODR) 2015 and shall make continues effort to provide the same to valuable stakeholders.

Further, Start working by Providing safety and healthy environment to the employee was the biggest challenge. The Company has implemented strict measures of ensuring social distancing, hygiene practices and deep cleaning of premises to ensure the safety of our workers, staff and the community at workplace.

DIVIDEND

The Board of Directors of your Company has Recommend dividend @15% i.e. Rs.1.5 per equity share of Rs.10/- each for F.Y. 2020-21, payable to those shareholders whose names appear in the Register of Members as on the Book Closure / Record Date.

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS

Detail of the loan, Guarantees and invstments covered under provision of section 186 of the company Act, 2013.

Particular Amount (Rs. in Lakh)
Investment in Mutual Fund 82.05
Investment in Equity Instruments 0.08
Investment in Equity Instruments of Associates 77.98
Total Investment 160.11

FIXED DEPOSIT

Your Company has not accepted any Deposits under Chapter V of the Act during the year and as such, no amount of principal or Interest on Deposit from public is outstanding as on March 31, 2021.

ASSOCIATE COMPANY

During the year Company has made an investment into the M/s. Sudeep Rub-Chem Private Limited by purchasing 48.34 % share and includes as an Associate Company which has impact in the books of accounts of the company.

Pursuant to the Section 129(3) of the Companies Act, 2013 read with rule 5 of the Companies (Accounts) Rules, 2014, a statement containing silent features of the Financial Statements of the Companys Associate Company in form No. AOC - 1 is attached in the Annexure-A

MANAGEMENT DISCUSSION AND ANALYSIS REPORT (MDAR)

Pursuant to Regulation 34(2) of Securities and Exchange Board of India (LODR), Regulation, 2015, a Management and Discussion and Analysis report is given in the Annexure-B.

DIRECTORS and KMPs

• Shareholders has appointed Smt. Harshila H. Patel (DIN: 08690119), as an Independent Women Director, by passing ordinary resolution in Annual General Meeting held on September 30, 2020.

• Shri Ashish S Amin, Managing Director of the Company retires by rotation in ensuing Annual General Meeting offer himself for reappointment.

• All Independent Directors have given Declarations that they meet the criteria of Independence as laid down under section 149(6) of the Companies Act, 2013.

• None of the Directors of your company is disqualified as per section 164(2) of the Companies Act, 2013. Your Directors have made necessary disclosures, as required under various provisions of Companies Act, 2013 and SEBI (LODR) Regulation-2015.

• Shri Navin U. Patel, CFO resigned on June 1, 2020 from the Company and Shri V. K. Shah has been appointed as CFO on June 18, 2020.

BOARD EVALUATION

In Compliance with the provisions of the Companies Act, 2013 and Regulation 25(4)(a) of the SEBI Regulation, Annual Performance evaluation of the Board And its Directors was carried out on based of selected parameters. All the Board Members have evaluated the Performance of Board as whole, Individual Performance of each Board member and the Chairman Managing Director, and the Board Committees of the Company, executive directors and non-executive directors.

In a separate meeting of the independent directors, performance of the independent and the non-independent directors was evaluated.

There are no observations which are carried by the Directors on evaluation of the Board. Further, in the view of previous years observation company has taken steps as suggested by the Directors.

MEETINGS OF BOARD AND COMMITTEE

The Details of the meetings of Board of Directors, Audit Committee and Nomination & Remuneration Committee held for the F.Y 2020-21 are given in Annexure-C

AUDIT COMMITTEE

The Audit Committee helps Board monitor the managements financial reporting process and ensures that Disclosures are accurate, timely and at highest level. It also oversees the Work of internal and independent Auditors.

Audit Committee is formulated by the Company with the following Composition;

1. Shri Kiran M. Patel :

Chairman of the Audit Committee

2. Shri Ashish S. Amin :

Member of the Audit Committee

3. Shri M H Joshi :

Member of the Audit Committee

NOMINATION & REMUNERATION COMMITTEE AND POLICY

Our Nomination & Remuneration Committee is formulated by the Company with the following Composition;

1. Shri Kiran M. Patel :

Chairman of the N & R Committee

2. Dr Arpita A. Amin :

Member of the N & R Committee

3. Shri M H Joshi :

Member of the N & R Committee

The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The detailed remuneration policy is available on the companys website www.rolconengineering.com

MEETING OF INDEPENDENT DIRECTORS

In terms of requirements under Schedule IV of the Companies Act, 2013 and Regulation 25(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate meeting of the Independent Directors was held on 25th February, 2021.

The Independent Directors at the meeting, inter alia, reviewed the following:-

• Performance of Non-Independent Directors and Board as a whole.

• Performance of the Chairman of the Company, taking into account the views of Executive Directors and Non Executive Directors.

• Assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your directors make the following statements in the terms of the section 134(3)I of the Company Act, 2013:

1. That in the preparation of the Annual financial statements for the year ended March 3 1, 202 1, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;.

2. That such accounting policies have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent 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 profit of the Company for the year ended on that date;

3. That Proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with provisions of the Companies Act, 2013 and for safeguarding the assets of the Company for preventing and detecting fraud and other irregularities;

4. That the Annual Accounts have been prepared on a going concern basis;

5. That the proper internal financial controls were in place and that the financial control were adequate and were operating effectively;

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on at arms length basis and were in the ordinary course of business.

All related party transactions were placed before the Audit Committee as also the Board for approval. Prior approval of the board and Audit Committee were obtained on a quarterly basis for the transactions which were of a foreseen and repetitive nature if any.

The details are given in Annexure-D

VIGIL MECHANISM/WHISTLE BLOWER POLOCY

The Company has a Vigil Mechanism/Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. Further, a dedicated helpline has been set up by the company in Line management. The helpline can be contacted to report any suspected or confirmed incident of fraud/misconduct. Details of the Policy are available on the companys website: www.rolconengineering.com.

CODEOF CONDUCT

The Board has framed and approved code of conduct for Board of Directors and senior management of the company in Compliance with Regulation 17(5) of SEBI (Listing Obligation & Disclosure Requirements) Regulation, 2015.

INTERNAL FINANCIAL CONTROLS

Adequate internal financial controls are in place which ensures the reliability of financial and operational information. The regulatory and statutory compliances are ensured to enables the business processes and also ensures financial discipline and fosters accountability.

INTERNAL AUDITOR

Shri Kanchanlal M. Parikh, (M.No. 008539), Chartered Accountant, who is our internal auditors have carried out internal audit for the F.Y 2020-21 and their reports were reviewed by the Audit Committee.

AUDITORS

At the 52nd AGM held on July 16, 2019 the Members have appointment of M/s JHS & Associates-LLP, Chartered Accountants (133288W/W100099), as Statutory Auditors of the Company to hold office for a period of five (5) years from the conclusion of that AGM till the conclusion of the 57th AGM (F.Y. 2023-24).

There are no qualifications, reservations or adverse remarks made by Statutory Auditors in their report for the F.Y. 2020-21.

SECRETARIAL AUDIT

Pursuant to provision of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the company has appointed M/s. Kiran Vaghela and Associates (C.P.No. 18617), Anand, a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Auditor of the company is annexed herewith as Annexure-E The Secretarial Auditors Report for the financial year 2020-21 does not contain any qualification, reservation or adverse remark.

ANNUAL SECRETARIAL COMPLIANCE REPORT

As per BSE circular LIST/COMP/12/2019-20 dated May 14, 2019, the company is claiming exemption under Regulation 15(2) of SEBI (LODR) Regulations, 2015 accordingly company is not required to submit Annual Secretarial Compliance Report to stock exchange.

CORPORATE GOVERNANCE

Pursuant to the SEBI circular dated September 15, 2014 and Regulation 15(2) contained in Chapter IV to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 dated September 2, 2015 in Connection with disclosure of Corporate Governance report is not applicable to the company, since the paid-up capital of the company is less than Rs. 10 Crores and Net Worth of the company is below Rs. 25 Crores as on last day of previous financial year.

ENERGY CONSERVATION, CHNOLOGY ABSORPTION AND FOREIG EXCHANGE EARNING AND OUTGO.

The information on Conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of the Companies (Accounts) Rules, 2014, is annexed herewith as Annexure-F.

DETAILS OF ORDER PASSED BY THE REGULATORS

There were no significant and material orders passed by the regulators or courts or Tribunals Impacting the Going Concern Status and Companys Operation in the future.

EXTRACT OF ANNUAL RETURN

The Details forming the part of the extract of the Annual Return in the Form MGT-9 is attached herewith as Annexure-G.

PARTICULARS OF EMPLOYEES

There is no employee whose details is required to be disclosed pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013.

The Company has safe and healthy work environment that enables its employees to work without fear, prejudices, gender bias and Sexual harassment and also set up guideline in line with the requirement of The Sexual Harassment of Women at workplace (Prevention, Prohibition & Redressal) Act, 2013.

Company has not received any complaints during the financial year.

ACKNOWLEDGEMENT

Your Directors place on record their sincere appreciation for overwhelming cooperation and assistance received from investors, customers, business associates, bankers, as well as regulatory and governmental authorities. Your Directors also thank the employees at all levels, who, through their dedication, co-operation, support and smart work, have enabled the Company to achieve growth.

For and on Behalf of Board of Directors of
Rolcon Engineering Company Limited
Vallabh Vidyanagar Sd/- Suresh H. Amin Chairman & WTD
May 28, 2021. DIN: 00494016