Ruttonsha International Rectifier Ltd Directors Report.

TO THE SHAREHOLDERS

Dear Members,

Your Directors have pleasure in presenting the Fiftieth Annual Report on the business and operations of the Company together with the Audited Accounts for the financial year ended 31st March, 2019.

FINANCIAL RESULTS AND OPERATIONS

(Amt in Rs.)

Particulars Year ended 31.03.2019 Year ended 31.03.2018
Revenue from Operations (Net) 435,761,768 326,335,351
EBITDA 56,356,630 36,613,411
Less - (i) Finance Costs 9,961,711 13,639,888
(ii) Depreciation and Amortisation Expenses 10,753,751 11,543,059
Profit before Tax 35,641,168 11,430,464
Less - (i) Provision for Taxation 11,034,000 4,600,000
(ii) Deferred Tax Asset (1,978,479) (519,624)
(iii) Short / (Excess) provision for Income Tax 587,386 (588,629)
Profit for the year 25,998,261 7,938,717
Add - Other Comprehensive Income for the year 33,307 339,573
Add - Balance brought forward from previous year 97,694,326 89,416,036
Balance carried to Balance Sheet 123,725,894 97,694,326

FINANCIAL PERFORMANCE

During the financial year 2018-19, your Company reported 33.53% increase in the topline. The total revenue for the financial year was Rs. 435,761,768/- as against Rs. 326,335,351/- last year. The Companys semiconductor devices, high power equipment and export business grew at a steady pace thereby report strong overall growth of the Company. Earnings before Interest, Tax and Depreciation and Amortisation (EBITDA) for the year also increased by 53.92 % to Rs.56,356,630/- as compared to Rs. 36,613,411/- last year on account of increase in Top line, better operational controls and optimum utilization of fixed overheads. Net Profit for the year increased by 3.27 times to Rs. 25,998,261/-as against Rs. 7,938,718/-last year.

There are no material changes or commitments affecting the financial position of the Company which have occurred between the end of the financial year and the date of the report.

DIVIDEND AND RESERVES

The Board of Directors of your Company are pleased to recommend a final dividend ofRs. 1/- (10%) per Equity Share ofRs. 10/- each for the Financial Year 2018-19; and on the occasion of completion of 50 years (1969-2019) of business of the Company, subject to the approval of shareholders at the 50th Annual General Meeting of the Company.

During the year under review, no amount from profits was transferred to General Reserve.

EQUITYSHARE CAPITAL

The paid up Equity Share Capital as on 3151 March, 2019 was Rs. 69,572,400/-. During the year under review, the Company has not issued any shares with differential voting rights nor has granted any stock options or sweat equity and does not have any scheme to fund its employees to purchase the shares of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 152 of the Companies Act 2013 ("the Act") read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and the Articles of Association of the Company, Mrs. Bhavna H. Mehta, Director of the Company, will retire by rotation and being eligible, offers herself for re-appointment. The Board recommends her re-appointment for the consideration of the members of the Company at the ensuing Annual General Meeting.

During the year under review, Mrs. Bhavna H. Mehta, was appointed as a Managing Director of the Company without remuneration for a period of 5 years from 16th May, 2019 to 151" May, 2024 as recommended by the Nomination and Remuneration Committee.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under the Act read with the Schedules and Rules issued thereunder as well as Regulation 16(1 )(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Mr. R. G. Trasi - C.E.O. and Mr. Bhavin R Rambhia - Company Secretary are the Key Managerial Personnel of your Company in accordance with the provisions of Section 2(51), 203 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment(s) for the time being in force).

The Company has devised a policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of Independent and Non Independent Directors. The board expressed their satisfaction with the evaluation process.

PUBLIC DEPOSITS

During the year under review, your Company has not accepted any deposits within the meaning of Section 73 and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or re-enactment(s) for the time being in force).

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The company has not made any investments, nor have given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

AUDITORS

(1) Statutory Auditors:

M/s. Ajmera Ajmera and Associates (Firm Regn. No.123989W), Chartered Accountants, Mumbai, Statutory Auditors of the Company have tendered their resignation as Statutory Auditors due to expiration of their Peer review certificate and being unable to review the Un-audited financial results for June, 2019 quarter. In order to fill up the casual vacancy, the Board recommended appointment of M/s. Kirtane & Pandit LLP, Chartered Accountants, Mumbai (Firm Regn. No. 105215W/W100057) to hold office as the Statutory Auditors of the Company till the conclusion of 50th AGM and to fill the casual vacancy caused by the resignation of M/s. AjmeraAjmera and Associates, Chartered Accountants, Mumbai (Firm Regn. No. 123989W).

Further, pursuant to recommendation of Audit Committee, the Board also approved appointment of M/s. Kirtane & Pandit LLP, as Statutory Auditors of the Company to hold office for a period of five years, from the conclusion of 50th Annual General Meeting upto the conclusion of 55th Annual General Meeting (AGM) of the Company to be held in the year 2023.

The Company has received consent letter and eligibility certificate from M/s. Kirtane & Pandit LLP Chartered Accountants, Mumbai (Firm Regn. No. 105215W/W100057), to act as Statutory Auditors of the Company alongwith a confirmation that, their appointment, if made, would be within the limits prescribed under The Companies Act, 2013.

The Board recommends the appointment of M/s. Kirtane & Pandit LLP, Chartered Accountants, Mumbai as Statutory Auditors of the Company.

The Board also places on record its appreciation for the services rendered by M/s. Ajmera Ajmera and Associates, Chartered Accountants, Mumbai.

(2) Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Act and the rules made thereunder, the Board of Directors of the Company has appointed M/s. Neetu Agrawal & Co., a firm of Company Secretaries in Practice (C.P. No. 9272) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed as Annexure B to the Directors Report.

The Auditors Report and the Secretarial Audit Report for the financial year ended 31st March, 2019 donot contain any qualification, reservation, adverse remark or disclaimer.

CREDIT RATING

ICRA Limited have reaffirmed their long term Credit rating of [ICRAJBB+ (pronounced ICRA double B plus) rating to the Companys Fund based limits and a short term rating of [ICRAJA4+ (pronounced ICRAAfour plus) rating to the Companys Non fund based limits. The outlook on the long term rating has been revised from stable to positive.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT-9, as required under the Act, is annexed as Annexure-A and forms an integral part of this report.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on arms length basis and in the ordinary course of the business and that the provisions of Section 188 of the Act and the Rules made thereunder are not attracted. Thus, disclosure in Form AOC-2 in terms of Section 134 of the Act is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. The Company has developed a framework through Standard Operating Procedures for the purpose of identification and monitoring of such Related PartyTransactions.

Details of the transactions with related parties are provided in the accompanying notes forming part of the financial statements.

RISK MANAGEMENT

The Company has in place adequate risk management system which takes care of risk identification, assessment and mitigation. Your Company has adopted a Risk Management Policy which establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk. The risk management framework defines the risk management approach of the Company and includes periodic review of such risks and also documentation, mitigating controls and reporting mechanism of such risks.

There are no risks which in the opinion of the Board threatens the existence of your Company. However, some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this report.

INTERNAL CONTROL SYSTEMS AND ADEQUACY

The Company has an effective internal control and risk-mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedures. The Companys internal control system is commensurate with its size, scale and complexities of its operations. The internal and operational audit is entrusted to M/s. Bhandarkar & Kale, Chartered Accountants. The main thrust of internal audit is to test and review controls, appraisals of risks and business processes, besides benchmarking controls with best practices in the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Audit Committee of the Board, Statutory Auditors and the Business Heads are periodically appraised of the internal audit findings and corrective action taken. Audit plays a key role in providing assurance to the Board of Directors. Significant audit observations and corrective actions taken by the management are presented to the Audit Committee of the Board.

REMUNERATION AND NOMINATION POLICY

A Committee of the Board named as "Nomination and Remuneration Committee" has been constituted to comply with the provisions of Section 178 of the Companies Act, 2013 and to recommend a policy of the Company on Directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters and to frame proper systems for identification, appointment of Directors & KMPs, payment of remuneration to them and evaluation of their performance and to recommend the same to the Board from time to time.

BOARD AND COMMITTEE MEETINGS

Four meetings of the board were convened and held during the year.

The Board has constituted an Audit Committee with Mr. Kisan R Choksey as Chairman and Mr. Venkitaraman Iyer and Mr. Pravin G. Shah as members.

There has not been any instance during the year when recommendations of the Audit Committee were not accepted by the Board.

DIRECTORS RESPONSIBILTY STATEMENT

In terms of Section 134 (5) of the Act, the directors of yourCompany confirm that:

i) in the preparation of the annual accounts for the financial year ended 31st March, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii) the directors 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 as at 3181 March, 2019 and of the profits of the Company forthe financial year ended 315t March, 2019;

iii) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the directors have prepared the annual accounts on a going concern basis;

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

vi) the directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.

ENVIRONMENT AND SAFETY

The Company is conscious of the importance of environmentally clean and safe operations. The Companys policy requires conduct of operations in such a manner, so as to ensure safety of all concerned, compliances of environmental regulations and preservation of natural resources.

As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has formulated and implemented a policy on prevention of sexual harassment at workplace with a mechanism of lodging complaints. The Policy aims to provide protection to female employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has also constituted an Internal Complaints Committee to inquire into complaints of sexual harassment and recommend appropriate action.

During the year under review, no complaints were reported to the Board.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has adopted a Whistle Blower Policy, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behaviour, 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 the Company has been denied access to the Audit Committee.

SIGNIFICANT AND MATERIAL ORDERS PASSED BYTHE REGULATORS OR COURTS

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

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

The information under Section 134 (3)(m) of the Act read with Rule 8 (3) of the Companies (Accounts) Rules, 2014 for the year ended 31st March, 2019 is given below and forms part of the Directors Report.

(a) Conservation of Energy:

(i) Steps taken or impact on conservation of energy:

1. Adequate steps for energy conservation, power factor improvement have been taken wherever feasible.

2. For effective treatment of effluents the Company has constructed an effluent treatment plant. Waste water generated from manufacturing process is treated/recycled at Effluent Treatment Plant and used for internal consumption and plantation.

3. There is adequate provision for the treatment of fumes resulting from the use of Sulphuric, Nitric, Hydrofluoric and other acids required for production.

4. Replacement of the conventional light fittings with LED lighting has resulted in lower power consumption for lighting.

(ii) Steps taken by the Company for utilizing alternative source of energy:

The Company has installed 10Kva three phase Roof Top Solar Panels at Baska Factory alongwith with online Inverter based system as an alternate means of power and to encourage energy conservation. This solar power plant is based on SPV (Solar Photovoltaic Cells) connected to grid.

(iii) Capital Investment on energy conservation equipments:

The Company continuously makes investments in its facility for better maintenance and safety of the operations. The Company has undertaken efforts to rectify the shortfalls in the existing facilities in order to reduce the energy consumption by setting up efficient facilities.

(b) Technology Absorption

(i) Efforts made towards technology absorption and benefits derived like product improvement, cost reduction, product development or import substitution:

The Company has received complete technical know how for Silicon Rectifiers and Silicon Controlled Rectifiers upto 30 mm devices from M/s. International Rectifier Corporation, California, U.S.A. The erstwhile Orient Semiconductors Pvt. Ltd., now amalgamated with the Company, received technical know how from Silicon Power Corporation, U.S.A. (an ex. General Electric facility) for manufacturing semiconductor devices upto 125 mm.

Efforts towards technology absorption include continued efforts for process improvements and improved product types/ designs in order to improve the efficiency, productivity and profitability of the Company.

(ii) Information regarding technology imported, during last 3 years: Nil

(iii) Expenditure incurred on Research and Development: Nil

(c) Foreign Exchange Earnings and Outgo

(i) Foreign Exchange earned during the year - Rs. 51,194,466/-
(ii) Outgo of Foreign Exchange during the year - Rs. 115,971,025/-

PARTICULARS OF EMPLOYEES

In terms of Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company does not have any employee who is employed throughout the financial year and in receipt of remuneration of Rs. 60 Lacs or more, or employees who are employed for part of the year and in receipt ofRs. 5 Lacs or more per month.

The information required pursuant to Section 197 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the members at the Registered office of the company during business hours on working days of the Company up to the date of forthcoming Annual General Meeting. If any member is interested in inspecting the same, such member may write to the company secretary in advance.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report forms an integral part of this report and gives details of the overall industry structure, economic developments, performance and state of affairs of your Companys businesses and other material developments during the financial year 2018-19.

CORPORATE GOVERNANCE REPORT

Since the paid up equity capital of the Company is less than Rs. 10 Crores and the networth of the Company is less than Rs. 25 Crores, the provisions of Regulations 17,18,19,20,21,22,23,24,25,26,27 and clauses (b) to (i) of sub-regulation 2 of Regulation 46 and para C, D & E of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 pertaining to Corporate Governance are not applicable to the Company.

ACKNOWLEDGMENT:

The Board wishes to place on record its sincere appreciation for assistance and co-operation received from customers, bankers, regulatory and government authorities during the year. The Directors express their gratitude to the shareholders for reposing their faith and confidence in the Company. The directors also acknowledge the contribution made by the Companys employees at all levels. Our consistent growth was made possible by their hard work, solidarity and support.

For and on behalf of the Board of Directors
Place : Mumbai Hasmukh J. Shah
Date : 12th August, 2019 Chairman