Samkrg Pistons & Rings Ltd Directors Report.


Your Directors are pleased and privileged to present 34thAnnual Report and the Audited Accounts of the Company for the year ended March 31, 2020.

Financial Results

(Rs InLakhs)
2019-20 2018-19
Gross total income from operations 29013.61 35616.53
Other Income 126.26 198.73
Profit before Interest, Depreciation and Tax (PBIDT) 4015.63 4567.42
Interest 103.17 143.75
Profit before depreciation and Tax (PBDT) 3912.46 4423.67
* Depreciation 1276.29 1205.97
Profit before Exceptional Item 2636.17 3217.70
C S R 41.00 42.50
Extraordinary Item 0 0
Profit after CSR 2595.17 3175.20
Provision for Taxation
i) Current Year 659.36 1026.61
ii) Deferred Taxation -24.00 45.00
Net Profit before Extraordinary Item 1959.81 2103.59
Extraordinary Item 0 0
Profit after Extraordinary Item 1959.81 2103.59

Note: Figures have been re-grouped wherever necessary to confirm to current period classification.


Your Directors recommended interim dividend of Rs 5/- per equity share (50%) of face value of Rs 10/- each for the year ended March 31, 2020 , paid in March and the final same has been confirmed dividend for the year.

CREDIT RATING is The companys financial reflected by becoming a debt free company for the last few years and credit ratings ascribed by CRISIL

(Reaffirmed) Longtermrating :CRISILA-/Stable Short term Rating : CRISILA2+ (Reaffirmed)

Review of business operations:

In the year 2019-20 the Domestic & Global Automotive Industry was passing through one of the most challenging times with the introduction of B. S. IV and then B. S. VI and also introduction of electric vehicles pushed Domestic Auto industry to slow down. Moreover rural economy showed signs of slow down. Domestic Industry performed very well and achieved the targets for the first two quarters and in the third quarter started slowing down and the last quarter drop down to the rock bottom because with the increased sales effect and manufacturing cost effective production.

Company achieved reasonably good financial results.

The Company posted the gross turnover of Rs 29013.61 lakhs during year 2019-20 as against Rs 35616.53 Lakhs in the previous year 2018-19 and Net turnover of

Rs 23551.32 Lakhs during the year 2019-20 as compared to Rs 28909.79 Lakhs for the previous year 2019-20. The company R&D expenditure is Rs 57.81Lakhs of Net sales during the year to catch up with up-gradation of technology and to meet OEMs ever demanding quality and new developments requirement to improve life cycle of their product meeting BS-VI norms of environmental standards for Auto components. The operations of the Company on the whole have been satisfactory.

In pursuance of National Electric Mobility Machine Plan (NEMMP) and other initiatives and Government to achieve long term growth in industry and reduced emissions and oil dependents. To meet these stringent environmental regulations on pollution and carbon emissions have necessitated heavy investments in both automobile and also auto parts such as our industries. To meet with the challenges of these BS-VI norms and having achieved BS-IV norms in the years 2015-16, 2016-17 and 2017-18 during the year 2019-20 have been many challenges and settling down for an improved performance.

As the rural economy is growing, the demand for two wheelers and three wheelers complying BS-VI norms may give encouraging results and hopeful of maintaining growth this year also. Company is now focusing customer preferences and distributions channels and always exploring new avenues in the export market which will give encouraging results. Earnings Before Depreciation, Interest and Tax (PBDIT) at Rs 3974.63 lakhs as against previous year of Rs 4524.92 Lakhs. The Profit Before Tax was at

Rs 2595.17 lakhs as compared to Rs 3175.20 lakhs in

2018-19 an decrease of 18.27%


In line with motto of ‘Reshaping our business for tomorrow Samkrg is serving the growing needs of our Business Accounts and Individual Customers of export and domestic and also OEM Customer segments by offering cost effective prices and different Products and Services. Our end to end operation across the value chain, from gross level customers enable us to deliver superior quality products. Over the years, we have built strong relationship with the domestic and overseas customers and other channel partners that has allowed us to serve all Customer segments through our nationwide professional distribution network. We are now leveraging this extensive network established for our products to extend our customer-centric services.


Pursuant to Section 134 of the Companies Act, 2013 with respect to the Directors Responsibility Statement, the

Board of Directors of the Company hereby confirms:

In the participation of Annual Accounts applicable Indian accounting standards have been followed and that there have been no material departures.

The Directors had selected such 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 March 31,

2020 and the profit loss account of the Company for that period.

The Directors had taken proper and 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.

The Directors had prepared the Annual on a going concern basis and

The Directors, in the case of listed had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively

The Directors had devised proper systems ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

The Companys Internal Auditors have periodic audit to provide reasonable assurance that the Companys established policies and procedures have been followed. The Audit Committee of the Board meets once in a quarter with Internal Auditors to review internal control and financial reporting issues.


Risk management committee consists of the following Directors:

1. Mr . S.D.M. Rao - Chairman
2. Mr . S Madhava Rao - Member
3. Mr . K Chaitanya Abhishek - Member


The company has taken all the steps to mitigate the following risks: Raw material prices: Ours is a continuous high volume manufacturing industry. Our profitability will depend on change in the price in raw materials and input costs.

Foreign currency Risks: Exchange rate fluctuations sometimes effect. Adequate steps were taken. Competition and Price Pressure: The Company is facing stiff competition in the segments of OEMs and aftermarket as well as price pressure from the OEMs which playing major roll on the profitability of the company.


The Corporate Social Responsibility committee consists of the following Directors:

1. Mr. S Kishore Chairman
2. Mr. Pinninti Raghu Prakash Swamy Member
3. Mr. K Chaitanya Abhishek Member

Corporate social responsibility policy was adopted by the Board of Directors on the recommendation of corporate social responsibility committee.

Report on corporate social responsibility as per Rule 8 of Companies (Corporate Social Responsibility) Rules, 2014 is prepared and the same is enclosed as annexure - 3.



The Independent Directors have submitted the declaration of independence as required pursuant Sec. 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Sec. 149(6).


The Nomination and Remuneration Committee consists of the following Directors namely Mr. K Chaitanya Abhishek, Ms. Nama Rishita, Mr. S. MadhavaRao.

Brief description of terms of reference:

Iden tifying persons who are qualified to directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the Board for their appointment and removal;

Carry on the evaluation of every directors performance;

For mulation of the criteria for qualifications, positive attributes and independence of a director;

R ecommend to the Board a policy relating to remuneration of the directors, key managerial personnel and other employees;

For mulation of criteria for evaluation independent Directors and the Board;

Devising a policy on Board diversity; and

Any other matter as the Board may decide time to time.

Nomination and Remuneration policy The objective of the Policy:

1. T o lay down criteria and terms and conditions regard to identifying persons who are qualified to become Directors (Executive and Non-Executive) and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration.

2. T o determine remuneration based on

Companys size and financial positions and trends and practices on remuneration prevailing in peer companies.

3. T o carry our evaluation of the performance Directors.

4. T o provide them reward linked directly to effort, performance, dedication and achievement relating to the Companys operations.

5. T o retain, motivate and promote talent to ensure long term sustainability of talented managerial persons and create competitive advantage.


Your Company recognizes the importance and benefits of having the diverse Board to enhance quality of its performance and has adopted a Nomination and Remuneration Policy as formulated by the Board of Directors. The Companys Nomination and Remuneration Policy has laid down a framework for remuneration of Directors (Executive and Non-Executive), Key Managerial Personnel and Senior Management Personnel.

These Policies are available on the Companys website at the



Pursuant to the provisions of the Act and Listing Regulations, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its various Committees for the financial year 2019-20. The evaluation was conducted on the basis of a structured questionnaire which comprises performance criteria such as performance of duties and obligations, independence of judgement, level of engagement and participation, attendance of directors, their contribution in enhancing the Boards overall effectiveness, etc. The Board has expressed their satisfaction with the evaluation process. The observations made during the evaluation process were noted and based on the outcome of the evaluation and feedback of the Directors, the Board and the management agreed on various action points to be implemented in subsequent meetings. The observations included those relating to further improvement in participation and deliberations at the meetings and conduct of the meetings, circulation of board presentations and its content.

The independent directors met on 23.09.2019 without the presence of other directors or members of Management. All the independent directors were present at the meeting. In the meeting, the independent and directors reviewed performance of non-independent directors, the Board as a whole and Chairman. They assessed the quality, quantity and timeliness of flow of information between the Company management and the Board.


Pursuant to Regulation 25(7) of the SEBI (LODR) Regulations, the Company has put in place a system to familiarize its Independent Directors about the

Company, its financial products, the industry and business model of the Company. In addition, the Company also updates on continuous basis to the Independent Directors about the ongoing events and developments relating to the Company, significant changes in regulatory environment through the Board/ Committee meetings and separate familiarisation programme(s). Familiarization Programme details:

(i) No. of programmes attended During the by Independent Director year (during the year and on a 4
Cumulative cumulative basis till date) 16
(ii) No. of hours spent by During the Independent Directors in year such programmes (during the year and on a cumulative Cumulative basis till date) 2.30 10.30

Pursuant to Regulation 46 of SEBI (LODR) Regulations the details of Familiarization Programme is uploaded on the Companys website.


Vide notification No.EBI/LAD-NRO/GN/2018/59

Securities and Exchange Board of India (SEBI) has notified SEBI (Prohibition of Insider Trading)

(Amendment) Regulations, 2018 with effect from April 01, 2019. The Company has accordingly formulated and adopted Code for Fair Disclosure of Unpublished Price Sensitive Information. The said code is also available on the website of company.



The company has neither issued any Loans, Guarantees nor made any investments during the Financial year 2019-20.



The particulars of contracts or arrangements with related parties referred to Section 188(1) are prepared in form No.AOC-2 pursuant to Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014. The details of the transactions with related parties are given in the financial statements.


The Company proposes to transfer an amount of

Rs 1185.69 lakhs to the general reserve for the financial year ended 31stMarch, 2020.


The Companys equity shares are listed on BSE Ltd., PJ Towers, Dalal Street, Mumbai 400001.


The details of the Board of Directors Meeting held were given in the Report on Corporate Governance under Item No. 2(b).


The Extract of Annual Return is prepared in Form MGT-9 as per the provisions of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 and the same is enclosed as Annexure-1 to this report.

The conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. Information with respect to the conservation of energy, technology absorption, foreign exchange earnings and outgo pursuant to provisions of Sec. 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is prepared and annexed as Annexure -2 to this report.


Shri S Madhava Rao, Director of the Company, who is liable to retire by rotation at this Annual General Meeting and being eligible, according to his performance and upon recommendation of nomination and remuneration committee, for re-appointment.

Key Managerial Persons

Mr. Kota Ramesh has been appointed as Chief Financial

Officer w.e.f. 16th May, 2019.

Mr. Dinker Mishra has been appointed as Company

Secretary & Compliance Officer w.e.f. 20th April, 2019.


The Company has not accepted any Deposits in terms of Section 73 of the Companies Act, 2013 and the rules made there under and hence compliance with the same is not applicable.


Statutory Auditors

At the Annual General Meeting held on 25th September, 2017 M/s. Sridhara Chary V & Co., Chartered Accountants, were appointed as statutory Auditors of the Company to hold officetill the conclusion of the

Annual General Meeting to be held in the calendar year 2022.

Auditors Report

There are no qualifications, reservations or adverse remarks made by M/s Sridhara Chary V & Co., chartered Accountants, Hyderabad Chartered Accountants (ICAI Reg. No.011478S) Statutory Auditors in their report for the Financial Year ended March 31st 2020..

Audit Committee

Composition of Audit Committee included in Corporate Governance report.

Corporate Governance

A separate report on Corporate Governance is annexed as part of the Annual Report along with the Auditors

Certificate on its compliance.


The Board of Directors has adopted whistle Blower policy. The Whistle Blower policy aims for conducting the affairs in the fair and transparent manner by adopting highest standards of professionalism, honest, integrity and ethical behavior. All permanent employees of the Company are covered under the Whistle Blower Policy.

A mechanism has been established for employees to report concerns about unethical behavior, actual or suspected fraud or violation of Code of Conduct and Ethics. It also provides for adequate safeguards against the victimization of employees who avail of the mechanism and allows direct access to the chairperson of the audit committee in exceptional cases.


As per the provisions of Section 204 of the Companies Act, 2013, the Board of Directors have appointed Mr. V B S S Prasad, Practicing Company Secretary (C.P.No: 4605) as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial year ended 31st March, 2020. Secretarial Audit Report issued by Mr. V B S S Prasad, Practicing Company Secretary in form MR-3 is enclosed as Annexure - 4 to this Annual Report.

There are no qualifications in Secretarial Audit Report.


The Statement of particulars of Appointment and Remuneration of Managerial Personnel as per Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as enclosed as per Annexure - 5 to this Annual Report.


All properties and insurable interests of the Company including building, plant & machinery and stocks have been fully insured.


There is no change in the Companys nature of business during the financial year ended March 31st, 2020.


The company has well defined internal control systems and procedures for ensuring optimum utilization of various resources, Investment decisions involving Capital Expenditure or taken up only after due appraisal and review. Internal audit function covers and carried out periodically and reviewed by the Audit Committee to ensure that all policies and procedures are adhered to, and all statutory obligations complied with.


No such orders have been received.


There are no Material changes and commitments in the business operations of the Company from the financial year ended 31st March, 2020 to the date of signing of the Directors Report.


The Company has adopted policy on Prevention of Sexual Harassment of Women at Workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the Financial year ended 31st march, 2020, the company has not received any Complaints pertaining to Sexual Harassment.


Your Directors wish to place on record their appreciation for the cooperation and support of Bankers, Customers, Business Associates, Shareholders, dealers, and suppliers who are enabling the Company to achieve its goals. The Directors also place on record their appreciation made by the employees at all levels.

On behalf of the Board of Directors
S. D. M. RAO
Place: Hyderabad
Date: 24th June, 2020