Roto Pumps Ltd Directors Report.
To the Members of ROTO PUMPS LTD,
Your Directors have pleasure in presenting their Forty Fourth Annual Report of the Company together with the Audited Financial Statements for the financial year ended 31st March, 2019.
Your Companys financial performance for the year under review along with the previous years figure is given hereunder:
Amount Rs. In Lacs
Financial year ended
|Particulars||31st March, 2019||31st March, 2018|
|Revenue from Operations||12,776.01||10,911.95|
|Profit / (loss) before finance costs, depreciation and taxation||3043.25||2,297.07|
|Less: Finance Costs||253.90||271.34|
|Profit before Taxation||2,045.44||1,333.33|
|Profit after tax||1,529.80||855.98|
|Add: Other Comprehensive Income||-32.86||30.16|
|Total Comprehensive Income for the year||1496.94||886.14|
Your Directors are pleased to recommend a dividend of Rs. 0.50 (i.e. 25%) per share for the financial year ended 31st March, 2019, which if approved by the Members at the forthcoming Annual General Meeting would result in a dividend outflow of Rs. 77,26,903/- and dividend distribution tax of Rs. 15,88,265/- aggregating a total outflow of Rs. 93,15,268/-. No amount from profit for the year has been transferred to the General Reserve.
The Paid-up Equity Share Capital as on 31st March, 2019 was Rs. 309.08 Lacs. During the year under review, your Company has not issued any shares, bonus shares or bought back any shares. The Company has not issued shares with differential voting rights. It has neither issued employee stock options nor any sweat equity shares and does not have any scheme to fund its Employees to purchase the shares of the Company.
Investor Education and Protection Fund
In terms of the provisions of Section 124(5) of the Companies Act, 2013 and Rule 3 of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the un-claimed dividend relating to the financial year 2010-11 has been remitted to the Investor Education and Protection Fund (IEPF) established by the Central Government. This involved transfer of Rs. 2,66,453/- unclaimed dividend and 56,453 related shares on which dividend had been unclaimed for seven consecutive years.
The un-claimed dividend for further years would become due for transfer to IEPF per below details-
|Amount in Rs.|
|S. No.||Financial year||Un-claimed dividend as on 31.07.2019||Due date for transfer to IEPF|
|1.||2011-12||178,225.00||October 29, 2019|
|2.||2012-13||226,040.00||November 04, 2020|
|3.||2013-14||233,040.00||November 05, 2021|
|4.||2014-15||217,131.60||November 06, 2022|
|5.||2015-16||80,668.80||November 05, 2023|
|6.||2016-17||171,725.60||November 05, 2024|
|7.||2017-18||137,539.60||November 05, 2025|
Further, in terms of the provisions of Section 124(6) of the Companies Act, 2013, and Rule 6 of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, shares related to the dividend, which would be transferred to Investor Education and Protection Fund as stated above, on which dividend for next seven years remained unclaimed/unpaid would also become due for transfer to the IEPF on the said date.
The Company Secretary is nominated as the Nodal Officer for issues relating to the Investor Education and Protection Fund. The Nodal Officer may be contacted at email@example.com.
Details of un-claimed dividend are available for on the Companys website at www.rotopumps.com.
Year in retrospect
Your Company has achieved an Income from Operations of Rs. 12776.01 lacs against previous years Rs. 10911.95 lacs registering a growth of 17.08%. Domestic sales were Rs. 4222.85 lacs as compared to Rs. 3718.57 lacs, representing a growth of 13.56%. Export sales were Rs. 8553.15 lacs as compared to Rs. 7193.38 lacs, having a growth of 18.90% over last year. Export sales include Rs. 5516.22 lacs, sales from Marketing Outlets in United Kingdom and Australia. Revenue from exports constitutes 66.94% of the total revenue from operations.
Your companys operations are expected to do better as sales would continue to rise due to strengthening of overseas business operations. At domestic front, with the formation of strong and stable Government, the business opportunities for your company would grow. However, time ahead looks challenging as growth in global economy is expected to decline during 2019 to 3.2% from 3.6% in 2018. While global economy is expected to grow positively at 3.5% in 2020, the advance economies are expected to register negative growth, silver lining is the emerging markets and developing economies, which would register positive growth. Your Company is strategically placed to gain from the emerging business opportunities.
Consolidated Financial Statements
The Consolidated Financial Statements of the Company and its subsidiaries have been prepared in accordance with Indian Accounting Standard 110 notified by the Ministry of Corporate Affairs, Government of India and form part of the Annual Report.
The annual accounts of the subsidiaries and related information are kept at the Registered Office of the Company, as also at the registered offices of the respective subsidiary companies and will be available to investors seeking information at any time.
Performance of the Subsidiaries Company
a. Roto Pumpen GmbH - a wholly owned subsidiary in Germany during to carry on the sales and marketing of the Companys products in German region to service the customers more effectively. The operations of the subsidiary are currently under suspension as per the decision of the Board. Effective steps are being taken to reassume operations by the subsidiary in near future.
b. Roto Pumps Americas, Inc. - a wholly owned subsidiary in USA which has an operating wholly owned subsidiary company in the name and style of Roto Pumps North America, Inc. to carry on sales and marketing of Companys products in North American region and also maintain warehouse facility to carry inventory.
c. Roto Overseas Pte Ltd - a wholly owned subsidiary in Singapore as your Company has acquired balance 40% stake during the year under review. The subsidiary holds almost 100% stake in Roto Pumps (Africa) Pty Ltd, South Africa, a company engaged in the business of sales and marketing of pumps and parts of pumps in the African Region.
Statement containing the salient features of financial statements of subsidiary companies in the prescribed Form AOC-1 is annexed as per Annexure-A.
Particulars of Loans, Guarantees or Investments
Your Company has acquired 3,20,000 shares of SGD 1 each at par value in Roto Overseas Pte Ltd, Singapore during the year under review.
Your company has not given any loan or provided any guarantees during the year under review.
Your Company has neither accepted nor renewed any deposits during the financial year under review.
Related Party Transactions
All Related Party Transactions that were entered into by the Company during the year under review were on an arms length basis and in the ordinary course of business and were in compliance with the applicable provisions of the Companies Act, 2013 (the Act) and Securities and Exchange Board of India ( Listing Obligations and Disclosure Requirements) Regulations, 2015. There were no materially significant Related Party Transactions made by your Company during the year that would have required Shareholder approval under Regulation 23 of securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Prior omnibus approval of the Audit Committee has been obtained for the transactions which are repetitive in nature. A statement of all Related Party Transactions is placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions and other relevant details as are required in terms of the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Details of the transactions with Related Parties are provided at Note no. 40 of the accompanying standalone financial statements.
Your Company has formulated a risk management policy to put in place a procedure to inform the Board about the risk assessment and minimization procedure. The Company has also formed a Risk Management Committee comprising of Directors and Executives of your Company to assess the risk and minimization procedures and report the same to the Board at the meetings.
Internal Control System and its adequacy
Your Company has an adequate internal control system commensurate with the size of the Company and nature of its business.
Further, in terms of provisions of Section 138 of the Companies Act, 2013 and the rules made thereunder, your Company has appointed M/s. Kapoor Tandon & Co., Chartered Accountants as its Internal Auditor to conduct the internal audit of the functions and activities and review of internal controls system in the Company. Based on the report of internal audit function, the Board undertakes corrective action in their respective areas and thereby strengthens the controls.
Directors and Key Managerial Personnel
Mr. B. S. Ramaswamy, independent director of the Company ceased to be director due to sad demise on 5th May, 2019
Pursuant to the provisions of the Companies Act, 2013 read with the Articles of Association of the Company, Mrs. Asha Gupta, Director (DIN: 00334354) retires from the Board by rotation, and is eligible for re-appointment.
Mr. Akhil Joshi, aged 60 years, superannuated as Director (Power) from Bharat Heavy Electrical Limited (BHEL) has been appointed as an Additional Director (Non-executive Independent) by the Board at its meeting held on 9th August, 2019 and recommended for appointment by the Members at the ensuing Annual General Meeting.
Mr. Harish Chandra Gupta, Chairman & Managing Director, Mr. Anurag Gupta, Dy Managing Director, Mr. Arvind Veer Gupta, Wholetime Director were reappointed for a further period of three years w. e. f. 1st April, 2019. Mr. Anurag Gupta was re-designated as Jt. Managing Director and Mr. Arvind Veer Gupta was re-designated as the Dy. Managing Director from the said date.
Re-appointment of Independent Directors, Dr. Ramesh Vaish, Mr. Anand Bordia, Mr. Basant Seth and Mrs. Annapurna Dixit for the second term is due at the ensuing Annual General Meeting. Considering their valuable contribution to the Company as Independent Directors, their re-appointment for the second term is recommended to the members of the Company at the ensuing Annual General Meeting.
Annual Evaluation of Board Performance and Performance of its Committees and of Directors:
Pursuant to the provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance, performance of the Directors as well as the evaluation of the working of its Committees. The Nomination and Remuneration Committee has laid down the evaluation criteria, procedure and time schedule for the Performance Evaluation process for the Board, its Committees and Directors.
Independent Directors and their meetings
The Independent directors were provided an insight about their roles, duties, rights and responsibilities. They were given a fair idea and knowledge about the working, strategy and the organizational structure of the company so that they could adapt to the company culture and contribute through active participation and interaction in a better manner.
The Nomination and Remuneration Policy adopted by your Company deals with the criteria for selection and determining the Independence of Directors and also the Remuneration policy for directors, Key Managerial Personnel (KMP) and other employees. The Remuneration policy is available at the website of the Company at http://www. rotopumps.com/investors/policies.html.
Your Companys Independent Directors meet at least once in a financial year without the presence of Executive Directors or Management Personnel. Such meetings are conducted to enable the Independent Directors to discuss matters pertaining to the Companys Affairs and put forth their views. During the year under review, one meeting of the Independent Directors was held on 8th February, 2019 where all the independent directors were present.
Board, Committees and their meetings
Details of the composition of the Board and its Committees and of the Meetings held and attendance of the Directors at such Meetings, are provided in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013, the Rules made thereunder and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Directors Responsibility Statement
In accordance with the provisions of Section 134(5) of the Companies Act, 2013, the Board hereby submits its responsibility Statement:
(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;
(b) The directors 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 your Company at the end of the financial year and of the profit and loss of your Company for that period;
(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 your Company and for preventing and detecting fraud and other irregularities;
(d) The directors had prepared the annual accounts on a going concern basis; and
(e) The directors had laid down internal financial controls to be followed by your Company and that such internal financial controls were adequate and were operating effectively.
(f) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Corporate Social Responsibility
Your Company has formulated its Corporate Social Responsibility (CSR) Policy to undertake the CSR activities as specified in the Schedule VII to the Companies Act, 2013. CSR Policy is available at http://www. rotopumps.com/investors/policies.html. The Annual Report of CSR activity for the financial year 2018-19 is annexed at Annexure -B.
Policy on prevention, prohibition and redressal of sexual harassment at Workplace
Your Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the workplace and prevent and redress any complaint(s) of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. Your Company has complied with the provisions of the Act relating to the constitution of Internal Complaints Committee, to inquire into complaints of sexual harassment and recommend appropriate action. Your Company has not received any complaint of sexual harassment during the year under review.
Vigil Mechanism / Whistle Blower Policy
Your Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or ethics policy. The Policy provides for adequate safeguards against victimization of employees who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee.
It is affirmed that no personnel of your Company has been denied access to the Audit Committee. The policy has been adopted in compliance with the requirements of SEBI and Section 177(9) of the Companies Act, 2013 and the Rules thereunder including any amendment(s) thereto.
Material changes and commitment, if any, affecting the financial position of the Company occurred between the end of the financial year to which these financial statements relate and the date of the report
No material changes and commitments affecting the financial position of your Company have occurred between the end of the financial year to which these financial statements relate and on the date of this report.
Your Company has complied with the requirements of the mandatory secretarial standards issued by the Institute of Company Secretaries of India.
Significant and Material Orders passed by the Courts or Regulators
No significant and material orders have been passed by the Regulators or Courts or Tribunals which would impact the going concern status of your Company and its future operations.
a. Statuary Auditors
M/s. R. N. Marwah & Co. LLP, Chartered Accountants, New Delhi, Firm Registration no. (001211N/N500019) were appointed as the Statutory Auditors of the Company for a period of five years by the members of the Company at their Annual General Meeting held on 29th September, 2017 subject to ratification at every intervening Annual General Meeting under section 139 of the Companies Act, 2013. Such requirement of ratification of appointment of Statutory Auditors at every intervening Annual General Meeting has since been dispensed with by the Companies (Amendment) Act, 2017; accordingly, no such ratification is required.
The observations of the Auditors in their report read with the notes to accounts are self-explanatory and do not call for any further action or information.
b. Branch Auditors
The term of the Branch Auditors of the Warehouse and Marketing Offices of the Company in Australia and U.K., M/s Eric Townsend & Co., Chartered Accountants, Australia and M/s Layton Lee, Chartered Accountants, U.K., respectively, will expire at the conclusion of the ensuing Annual General Meeting. Board of Directors of your Company is seeking authority to appoint Branch Auditors for the financial year 2019-20.
c. Cost Auditor
In terms of the provisions of Section 148(1) of the Companies Act, 2013, the Company has maintained cost accounts and records in respect of the applicable products for the year ended 31st March 2019.
Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Board, on the recommendation of the Audit Committee, at its meeting held on 9th August, 2019, has approved the appointment of M/s. Chandra Wadhwa & Co., Cost Accountants, New Delhi, (Firm Registration No 00239) as the Cost Auditors for the Company for the financial year ending 31st March 2020. Ratification of remuneration of the Cost Auditor for the financial year 2019-20 by the shareholders of the Company is being sought at the ensuing Annual General Meeting.
The Report of the Cost Auditor for the financial year ended 31st March 2019 shall be filed with the Ministry of Corporate Affairs within the prescribed period.
d. Secretarial Auditors
M/s Dayal & Maur, Company Secretaries, New Delhi have been appointed as the Secretarial Auditors to carry out the secretarial audit for the year under review. The Secretarial Audit Report for the financial year ended 31st March, 2019 is annexed at Annexure- C.
There is no qualification or observation in the report of the Secretarial Auditors.
Conservation of energy, Technology absorption, Foreign Exchange earnings and outgo
The information pertaining to conservation of energy, technology absorption, Foreign exchange Earnings and outgo as required under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished at Annexure -D.
Declaration of Independent Directors
The Independent Directors have submitted their disclosures to the Board that they fulfill 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 made thereunder.
Your Companys definition of Independence of Directors is derived from Regulation 16(1) (b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149(6) of the Companies Act, 2013. Based on the confirmation / disclosures received from the Directors and on evaluation of the relationships disclosed, the following Non-Executive Directors are Independent in terms of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149(6) of the Companies Act, 2013.
a) Dr. Ramesh Chandra Vaish
Dr. Ramesh Chandra Vaish, aged about 78 years holds a degree in M.A., M.Com, LLB, Ph.D. in Economics from University of Florida USA and is a Fellow Member of the Institute of Chartered Accountants of India. Dr. Vaish is an eminent practicing Chartered Accountant having over 46 years of rich and varied experience with specialization in International taxation and finance, tax planning and off-shore investment. Dr. Vaish has an outstanding academic record and after teaching at University of Florida, USA, has worked with Coopers and Lybrand in New York, Singapore, London and New Delhi. Dr. Vaish has been a Senior Counsel, Tax and Business Advisory Services at Price Waterhouse Coopers, New Delhi, besides being a member of the Company Law Advisory Committee, Regional Tax Advisory Committee and various fiscal committees of FICCI and ASSOCHAM.
b) Mr. Anand Bordia
Mr. Anand Bordia, aged 75 years is a retired IRS Officer, holds degree in M.A. Mr. Bordia has 38 years of professional experience, most of which have been at a senior level in the Government of India and International Organizations. Mr. Bordia has worked in Ministry of Finance and Ministry of Social Justice & Empowerment in the Government of India. Mr. Bordia has been Member Finance in National Highway Authority of India. Mr. Bordia has also worked in Indian Customs and Central Excise Department and held various field positions such as Commissioner of Customs and Director Audit. Mr. Bordia has also worked in the Secretariat of Custom Cooperation Council, Brussels.
c) Mrs. Annapurna Dixit
Mrs. Annapurna Dixit, aged about 71 years, a retired Information Commissioner, Central Information Commission, is a Graduate in Physics (Hons), Masters and M. Phil in Education. Mrs. Dixit has worked for over two decades as an Officer in the India Country Office of the United Nations Childrens Fund. Mrs. Dixit closely worked with the relevant Ministries of Government of India, State Governments, NCW, NHRC, IMA, NIPCCD and with NGOs for ensuring protection of rights of women and children.
d) Mr. Basant Seth
Mr. Seth aged 67 years is a Science graduate from Banaras Hindu University, a qualified Chartered Accountant and also has Post Graduate Diploma in Bank Management from National Institute of Bank Management, Pune. Mr. Seth has recently retired as Central Information Commissioner after successfully completing his tenure of five years. Before joining the Central Information Commission, he was a banker. He has served Bank of India for a very long period and later SIDBI. He has also served the Syndicate Bank as its Chairman and Managing Director.
Mr. Seth has extensive Board level experience having served as Bank of Indias nominee on the Board of Indo-Zambian Bank, Zambia and Commonwealth Finance Corporation Ltd Hong Kong besides holding the post of Whole Time Director in SIDBI and CMD of Syndicate Bank. He has long experience and expertise in Bank Management, Corporate Governance, Financial & Administrative matters.
e) Mr. Akhil Joshi
Mr. Akhil Joshi aged 60 years, superannuated as Director (Power) from Bharat Heavy Electrical Limited (BHEL). He is a Mechanical Engineer and earned his degree of Mechanical Engineering from Delhi College of Engineering in 1979.
Mr. Akhil Joshi has almost four decades of rich experience in Power Sector, International Operations Division and Corporate Technology Management. During his tenure at the International Operations Division, he played a key role in the strategic growth of the companys overseas business in highly competitive markets such as the Middle East, South East Asia, the CIS region, the Mediterranean and Europe. He successfully pioneered BHELs maiden entry into a range of overseas markets including, among others, Iraq, Vietnam, Belarus, Bangladesh, Cyprus and Egypt. He played a pivotal role in negotiating and securing key EPC contracts for power projects in Iraq under the Oil-for-Food program and securing approvals from the Sanctions Committee of the United Nations.
Particulars of Employees and related disclosures
The 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 is furnished at Annexure- E.
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, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules is furnished at in Annexure-F.
Listing of Shares
The Equity Shares of your Company are listed at the BSE Ltd, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400001. The annual listing fee for the year 2018-19 has been fully paid.
Pursuant to the provisions of Section 92(3) of the Companies Act, 2013, as amended by the Companies (Amendment) Act, 2017 a copy of the Annual Return has been placed on the website of the Company and can be accessed through the web-link: http://www.rotopumps.com/ investors.html under the head Annual Returns.
The Management Discussion and Analysis and the Report on Corporate Governance, as required under Regulation 34 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with Schedule V thereof, forms part of the Annual Report.
Your Directors place on record their sincere thanks to the Bankers, Business Associates, Consultants, and various Government Authorities for their continued support extended to your Companys activities during the year under review. Your Directors also acknowledge gratefully the shareholders for their valuable support and confidence reposed in the Company.
|For and on behalf of the Board of Directors|
|Harish Chandra Gupta|
|Place: Noida||Chairman & Managing Director|
|Dated: 09.08.2019||DIN: 00334405|
Statement containing salient features of the financial statements of subsidiaries (Pursuant to the first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014
Part "A" - Subsidiaries
Name of the Subsidiaries
|Sl. No.||Particulars||Roto Pumpen GmbH||Roto Pumps Americas, Inc.||Roto Pumps North America, Inc. -stepdown||Roto Overseas Pte Ltd.||Roto Pumps (Africa) Pty Ltd. -stepdown|
|1||Reporting period of the subsidiary on if different from the holding companys reporting period||N.A||N.A||N.A||N.A||N.A|
|2||Reporting currency and Exchange rate as on year end date||EURO 77.75||USD 68.58||USD 68.58||SGD 50.30||RAND 4.77|
|4||Reserve & Surplus||(222,586)||(1,393)||(40,896)||(154,419)||137,595|
|9||Profit/(Loss) before taxation||(925)||(545)||2,54,323||(38,463)||776,415|
|10||Provision for taxation||-||-||-||-||(217,397)|
|11||Profit/(Loss) after taxation||(925)||(545)||254,323||(38,463)||559,018|
|13||% of shareholding||100||100||100||100||99.995|
No subsidiary has been liquidated or sold during the year. Part "B": Associates and Joint Ventures
As per our report of even date.
|For R.N Marwah & Co LLP||For and on behalf of the Board|
|(Registration No.0001211N/N500019)||(HARISH CHANDRA GUPTA)||(ANURAG GUPTA)|
|(Manoj Gupta) PARTNER||Chairman & Managing Director||Jt. Managing Director|
|(DIN : 00334405)||(DIN : 00334160)|
|Place: Noida||(PRADEEP JAIN)||(ASHWANI K VERMA)|
|Date : 24.05.2019||Chief Financial Officer||Company Secretary|
|(PAN : AAEPJ6827A)||(M.No : F9296)|