Shakti Pumps (India) Ltd Directors Report.
Your Directors have great pleasure in presenting the 24th Annual Report and the Companys Audited Financial Statement for the financial year ended March 31, 2019.
|The Financial Summary: -|
|(Rs. in lacs)|
|Sales & Other Income||52,591.23||41,601.52||55,025.14||44,010.12|
|Profit before Finance Cost, Depreciation & Tax||7,692.81||7,279.77||9,296.80||8,196.38|
|Depreciation & Amortization Expenses||1,487.62||1,394.72||1,504.38||1,394.95|
|Profit before Tax||4,531.40||4525.99||6,011.76||5,400.52|
|Profit after Tax||3,143.10||2,784.74||4,507.50||3,484.83|
During the year, your Company has registered sales and other income Rs. 54,644.99 lacs as compared to Rs. 44,010.12 lacs of previous year showing an increase of 24.16%. Company was able to register a domestic sale of Rs. 39,189.24 lacs and export sale of Rs.13,882.95 lacs in the current year and there was an overall increase in sales by 25.16% the Company has earned profit after tax of Rs. 4,507.50 lacs for the financial year 2018-19.
Based on the Companys performance, the Board of Directors recommend for approval of the members, a dividend of Rs. 5 (50%) per fully paid-up Equity Share of Rs.10/- each of the Company, for the year ended March 31, 2019 if approved by the members, would involve a cash outflow of Rs.11.08 Crs.
TRANSFER OF RESERVE
The Company has not transferred any amount to the General Reserves for the year ended March 31, 2019.
The Company Shares are listed as follows:
|Name of Stock Exchanges||Stock Code/ Symbol|
|BSE Limited (BSE)||531431|
|P.J. Towers, Dalal Street, Mumbai-400001|
|National Stock Exchange of India Limited (NSE)||SHAKTIPUMP|
|"Exchange Plaza", Bandra Kurla Complex,|
|Bandra (E), Mumbai - 400 051.|
There is no change in the authorized share capital of the company and the authorized share capital of the Company as on March 31, 2019 is Rs. 40.00 crores.
The Company has not allotted any Shares during the year. The paid up share capital of the Company as on March 31, 2019 is Rs. 18,38,01,560/-
SUSBSIDIARIES, JOINT VENTURES AND ASSOCIATES COMPANIES
As on March 31, 2019 your Company is having following Subsidiaries:-
1. Shakti Pumps LLC, USA
2. Shakti Pumps FZE, UAE
3. Shakti Pumps Pty Ltd, Australia
4. Shakti Pumps (Shanghai) Limited- China
5. Shakti Pumps (Bangladesh) Limited
6. Shakti Energy Solutions Private Limited.
There has been no material change in the nature of the business of the Company and its Subsidiaries.
Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (Act), a statement containing salient features of financial statements of Subsidiaries Companies in Form AOC-1 in Annexure -I.
The Consolidated Financial Statement of the Company prepared as per the Accounting IND-AS Consolidated Financial Statement of the Company with its Subsidiaries have also been included as part of this Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
As required by section 134 (3) (c) of Companies Act 2013. Your Directors state that:-
a) In the preparation of the annual accounts for the year ended March 31, 2019, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
b) 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 March 31, 2019 and of the profit of the Company for the year ended on that date;
c) 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;
d) The Directors have prepared the annual accounts on a going concern basis;
e) The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The Management Discussion and Analysis forms an integral part of this Report and gives detail of the overall industry structure, developments, performance and state of affairs of the Companys various businesses viz., the decorative business international operations, industrial and home improvement business, internal controls and their adequacy, risk management systems and other material developments during the financial year.
Corporate Governance is an ethically driven business process that is committed to values aimed at enhancing an organizations brand and reputation. The Companies Act, 2013 and SEBI (Listing obligation and Disclosure Requirements) Regulation 2015 have strengthened the governance regime in the country. The Company is in compliance with the governance requirements and had proactively adopted many provisions of, ahead of time. The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI.
A separate report on Corporate Governance is provided together with a Certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance.
A Certificate of the MD and CFO of the Company, inter alia, confirming the correctness of the financial statements and cash flow statements, adequacy of the internal control measures and reporting of matters to the Audit Committee, is also annexed.
During the financial year 2018-19, the Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.
DETAILS OF SIGNIFICANT AND MATERIALS ORDER PASSED BY THE REGULATORS, COURTS, TRIBUNAL
No significant and material order has been passed by the regulator, courts, tribunals impacting the going concern status and Companys operations in future.
CORPORATE SOCIAL RESPONSIBILTY
In line with provision of the Companies Act, 2013, the Company has framed its Corporate Social Responsibility (CSR) policy for the development of programs and projects for the benefit of weaker sections of the Society and the same has been approved by CSR Committee and the Board of Directors of the Company. CSR policy has been uploaded on the Companys website at www.shaktipumps.com.
Pursuant to requirements under section 135 and rules made there under a Report on CSR activities and initiatives taken during the in prescribed format is given in Annexure II which is annexed hereto and forms part of Director Report.
Risk management is the process of identification, assessment, and prioritization, of risk followed by coordinated efforts to minimize, monitor and mitigate/control the probability and/ or impact of unfortunate events or to maximize the realization of opportunities. The Company has laid a comprehensive risk assessments and minimization procedure which is reviewed by the audit committee and approved by Board.
INTERNAL FINANCIAL CONTROL
According to Section 134 (5) (e) of the Companies Act, 2013 the term Internal Financial Control (IFC) means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to 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 information.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All transactions entered with related parties during the financial year 2018-19, were on an arms length basis and were in ordinary course of Business and the provisions of section 188 of the Companies Act, 2013 are not attracted. Further, there are no materially significant related party transactions during the year made by the Company with promoter, Directors, Key Managerial personnel or other designated persons which may have potential conflict with the interest of the Company at large. All related party transactions are placed before the audit committee for approval. Prior omnibus approval of the audit committee is obtained for the transaction which is of a foreseen and repetitive nature. Transaction entered into pursuant to omnibus approval so granted along with statements giving details of all related party transaction are placed before the Audit Committee.
In line with the requirements of the Companies Act, 2013 and SEBI Listing Regulation 2015, the Board has approved a Policy on Related Party Transactions which is also available on Companys website at www.shaktipumps.com.
Mr. Sunil Patidar, Whole-Time Director (DIN: 02561763) retires from the Board by rotation and being eligible, offer himself for reappointment.
Mr. Keyur Bipinchanra Thaker, Additional Independent Director (DIN : 08474827) has been appointed as an Additional Independent Director on June 11, 2019 being eligible for appointment as an Independent Director for a period of 5 years.
Mr. Navin Sunderlal Patwa, Independent Director (DIN : 01009404) retires from the Board as an Independent Director and being eligible, for reappointment as an Independent Director for a period of 5 years.
The above is subject to approval of the Shareholders in the ensuing Annual General Meeting.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The Remuneration Policy of the Company is designed to attract, motivate and retain manpower in a competitive and international market. The policy reflects the Companys objectives for good corporate governance as well as sustained long-term value creation for shareholders. The Remuneration Policy applies to the Companys senior management, including its Key Managerial Person and Board of Directors. The Nomination and Remuneration Policy for the members of Board and Executive Management is available on the Companys website, www. shaktipumps.com
ANNUAL EVALUATION OF BOARDS PERFORMANCE
In accordance with the provisions of Schedule IV of the Companies Act 2013, a Separate Meeting of the Independent Directors was held on October 16, 2018, without the attendance of Non-Independent Directors and Members of the Management. The Committee has reviewed the performance and effectiveness of the Board in this meeting as a whole for the Financial Year 2018-19.
FINANCE & ACCOUNTS
The agenda for the Finance and Accounts function of your Company is to assist in driving superior performance of the business, pioneer-thought leadership and develop future-ready talent in finance.
Risk and Internal Adequacy:
Your company has an elaborate Risk Management procedure, which is based on three pillars: Business Risk Assessment, Operational Control Assessment and Policy Compliance processes. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The Companys internal control systems are commensurate with the nature of its business and the size and complexity of its operations.
These are routinely tested and certified by Statutory as well as Internal Auditors and cover all offices, factories and key business areas. Significant audit observations and follow up actions thereon are reported to the Audit Committee. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems.
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. Dinesh Patidar:- Managing Director (DIN: 00549552)
Mr. Ramesh Patidar:- Whole Time Director (DIN: 00931437)
Mr. Dinesh Patel:- Chief Financial Officer (Appointed w.e.f March 20, 2019)
Mr. Akhilesh Maru:- Chief Financial Officer (Resigned w.e.f Feburary 23, 2019)
Mr. Ravi Patidar:- Company Secretary & Compliance Officer
NUMBER OF MEETINGS OF THE BOARD
The details of the number of Board and Audit Committee meetings of the Company are set out in the Corporate Governance Report which forms part of this Report.
DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration as limits set out in the said rules is given in annexure III.
DISCLOSURE BY INDEPENDENT DIRECTORS
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 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013.
The Company is committed to provide the healthy environment to all its employees, the company has in place a Prevention of the Sexual Harassment Policy and an Internal complaints committee as per the requirements of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, The policy aims at educating employees on conduct that constitute sexual harassment, ways and means to prevent occurrence of any such incident, and the mechanism for dealing with such incident in the unlikely event of its occurrence. The Company has also constituted an Internal Committee as required under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules made there under. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, no complaints were received against the sexual harassment at workplace.
The Board has appointed M. Maheshwari & Associates, Practicing Company Secretary to conduct the Secretarial Audit of the Company for the financial year 2018-19. The Secretarial Audit Report is annexed herewith Annexure IV to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
As per the requirement of Central Government and pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the Company has been carrying out audit of Cost Records.
The Board of Directors, on the recommendation of Audit Committee, has appointed M/s. M.P. Turakhia & Associates, Cost Accountant, as Cost Auditor to audit the cost accounts of the Company for the Financial Year 2018-19 at a remuneration of Rs. 55,000/- As required under the Companies Act, 2013. A resolution seeking members approval for the remuneration payable to the Cost Auditor forms part of the Notice convening the Annual General Meeting.
EXTRACT OF ANNUAL RETURN
The extract of annual return in Form MGT-9 as required under Section 92(3) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014 is appended as an Annexure-V to this Annual Report and also available on the website of the Company at https://www.shaktipumps. com/pdf/reports/Annual_Report-MGT-9_31.03.2019.pdf
COMPLIANCE OF SECRETARIAL STANDARD
The Company has complied with the Secretarial Standards issued by The Institute of Company Secretaries of India and approved by the Central Government as required under Section 118(10) of the Companies Act, 2013.
The Company has framed a vigil mechanism/whistle blower policy to deal with unethical behavior actual or suspected fraud or violation of the Companies Code of Conducts or ethics policy, if any. The Vigil Mechanism/ whistle blower policy has been uploaded on the website of the Company.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
The Details of loans, guarantees or investments covered under the provision of under Section 186 of the Companied Act, 2013 are given in the Note to the Financial Statement.
CONSERVATION NOTES OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is set out herewith as "Annexure VI" to this Report.
APPRECIATION AND ACKNOWLEDGMENTS
Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment.
The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as industry leaders.
The board places on record its appreciation for the support and co-operation your company has been receiving from its suppliers, retailers, dealers and other associated with the company. Your company looks upon them as partners in its progress and has shared with them the rewards of growth. It will be your Companys endeavor to build and nurture strong links on mutuality of benefits, respect for and co-operation with each other, consistent with consumer interests.
The Directors also take the opportunity to thank all shareholders, clients, vendors, Banks, Government and Regulatory authorities and stock exchanges, for their continued support.
|For and on behalf of the Board of Directors|
|Shakti Pumps (India) Limited|
|Place: - Pithampur||Managing Director|
|Dated:- August 12, 2019||DIN: -00549552|