Sibar Auto Parts Ltd Directors Report.

Dear Members,

Your directors have pleasure in presenting the 37th Annual Report on the business of your Company together with the Audited Statements of Accounts for the financial year ended 31st March, 2020.

1. FINANCIAL SUMMARY:

Your Companys performance during the year ended 31st March, 2020, as compared to the previous financial year, is summarized as below:

(Rs. In Lakhs)
PARTICULARS Financial Year 2019-20 Financial Year 2018-19
Revenue from operation 2028.22 2741.44
Other Income 22.68 75.05
Total income 2050.90 2816.49
Profit/(Loss) before Interest, Depreciation and Tax (174.92) (200.72)
Finance Charges 56.41 66.01
Depreciation 98.93 93.36
Net Profit/Loss Before Tax (PBT) (330.26) (360.09)
Provision for Tax - -
Current Tax - -
Provision for earlier years - -
Deferred tax 1.06 1.35
Net Profit (PAT) (331.32) (361.44)

2. TRANSFER TO RESERVES

The Company did not transfer any amount to the General Reserve for the Financial Year ended March 31, 2020.

3. SHARE CAPITAL

During the year, Company has allotted 9,25,000 equity shares to the promoters and non-promoters upon conversion of convertible warrants allotted on preferential basis. The paid-up equity share capital of the Company has been increased from Rs. 15,60,01,000 to Rs. 16,52,51,000/-. During the year under review, the Company has not issued shares with differential voting rights, sweat equity shares or Employee Stock Options.

4. DIVIDEND:

On account of the accumulated losses, your Directors do not recommend any dividend for the year ended 31st March, 2020.

5. DIRECTORS & KEY MANAGERIAL PERSONAL:

In accordance with the provisions of Section 152 of the Companies Act, 2013 Smt. Pemmasani Sugunamma (DIN: 07128299), Director, retires by rotation at the forthcoming Annual General Meeting and being eligible offers herself for re-appointment. The Board recommends her reappointment for the consideration of the members of the company at the forthcoming annual general meeting. Brief details of Smt. Pemmasani Sugunamma has been mentioned in the notice convening the Annual General Meeting at "Information pursuant to the Listing Regulations and Secretarial Standards in respect of Appointment/Re-appointment of Directors".

Members are aware that Shri. Narayana Yadla and Shri. Rajesh Katragadda has been appointed as independent Directors at the 36th Annual General Meeting of the Company. Further, Shri Bhuvanagiri Purushotham Jetty has been vacated from the office of the Director on 24th November 2019 due to his death.

6. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declaration from each Independent director under 149(7) of the Companies Act, 2013, that he/she meets the criteria of Independence laid down under section 149(6) of the Companies Act 2013.

7. MEETINGS OF THE BOARD

The Board met Seven Times during the financial year 2019-20 viz., on 30.05.2019, 14.08.2019, 26.08.2019, 28.09.2019, 04.10.2019, 14.11.2019 and 13.02.2020. The maximum interval between any two meetings did not exceed 120 days.

8. STATUTORY AUDITORS:

M/s. M M G S & Associates (Firm Registration No: 010613S), Chartered Accountants was appointed as the Statutory Auditors at the Annual General Meeting held on 30th September, 2019f or a term of 5 years from the conclusion of the 36th Annual General Meeting till the conclusion of 41st Annual General Meeting. The report of the Statutory Auditors along with notes to Schedules is enclosed to this report.

9. AUDITORS REPORT

There are no qualifications, reservations or adverse remarks made by M/s. M M G S & Associates., Chartered Accountants, Statutory Auditors in their report for the Financial Year ended 31st March, 2020.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company under sub-section (12) of section 143 of the Companies Act, 2013, during the year under review.

10. INTERNAL AUDITORS:

The Board of Directors based on the recommendation of the Audit Committee has appointed M/s. Y C Narayana & Co., Chartered Accountants, Vijayawada, as the Internal Auditors of your Company. The Internal Auditors are submitting their reports on quarterly basis.

11. SECRETARIAL AUDITORS:

M/s. P. S. Rao & Associates, Practicing Company Secretaries were appointed to conduct the Secretarial Audit of the Company for the financial year 2019-20, as required under Section 204 of the Companies Act, 2013 and Rule 9 there-under. The secretarial audit report for F.Y. 2019-20 forms part of this Report as Annexure- I.

12. SECRETARIAL AUDIT REPORT

There are no qualifications, reservations or adverse remarks made by M/s. P. S. Rao & Associates, Practicing Company Secretaries in their report for the Financial Year ended 31st March, 2020.

13. RISK MANAGEMENT POLICY

The Company has developed and implementing a risk management policy which includes the identification therein of elements of risk, which in the opinion of the board may threaten the existence of the Company.

14. CORPORATE SOCIAL RESPONSIBILITY (CSR):

The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.

15. COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee of the Company comprises the following Members

Shri. Y Narayana Chairman
Sri Rajesh Katragadda Member
Smt. P Sugunamma Member

All the recommendations made by the Audit Committee of the Company have been considered and accepted by the Board of Directors of the Company.

16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO:

Information required under section 134(3) (m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed herewith as Annexure- II.

17. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF THE MEMBERS OF THE BOARD AND COMMITTEES

One of the key functions of the Board is to monitor and review the board evaluation framework. The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive/non-executive/independent directors through a peer-evaluation excluding the director being evaluated through a Board effectiveness survey. The questionnaire of the survey is a key part of the process of reviewing the functioning and effectiveness of the Board and for identifying possible paths for improvement. Each Board member is requested to evaluate the effectiveness of the Board dynamics and relationships, information flow, decision-making of the directors, relationship to stakeholders, company performance, company strategy, and the effectiveness of the whole Board and its various committees on a scale of one to five. Feedback on each director is encouraged to be provided as part of the survey.

Independent directors have three key roles - governance, control and guidance. Some of the performance indicators based on which the independent directors are evaluated include:

• Ability to contribute by introducing international best practices to address top-management issues

• Active participation in long-term strategic planning

• Commitment to the fulfillment of a directors obligations and fiduciary responsibilities; these include participation in Board and committee meetings.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.

18. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

The Company has in place an Internal Control System, commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weaknesses in the design or operation were observed.

19. SUBSIDIARIES:

The Company has no subsidiaries as on 3151 March, 2020.

20. NOMINATION AND REMUENRATION POLICY:

A committee of the Board named as "Nomination and Remuneration Committee" has been constituted to comply with the provisions of section 178 of 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. The policy is also posted in the investors section of the companys website.

21. FIXED DEPOSITS:

Your Company has not accepted any fixed deposits and as such no principal or interest was outstanding as on the date of the Balance sheet.

22. PARTICULARS OF LOANS, GUARANTEES, OR INVESTMENTS:

Details of the Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, if any, are given in the notes to the financial statements pertaining to the year under review.

23. POLICY ON SEXUAL HARASSMENT:

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 March 31, 2020, the company has not received any complaints pertaining to sexual harassment.

24. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (5) of the Companies Act, 2013 Your Directors confirm that:

i) In preparation of annual accounts for the financial year ended 31st March, 2020, 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 true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March, 2020 and of the profit and loss of the Company for the year;

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

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

25. VIGIL MECHANISM:

The Company has a Whistle Blower Policy framed to deal with instance of fraud and mismanagement, if any in the Company. The details of the Policy are posted on the website of the Company www.sibarauto.com

26. RELATED PARTY TRANSACTIONS:

Related party transactions entered during the financial year under review are disclosed in Note No.30 of the Financial Statements of the Company for the financial year ended 31st March, 2020. These transactions entered were at an arms length basis and in the ordinary course of business. There were no materially significant related party transactions with the Companys Promoters, Directors, Management or their relatives, which could have had a potential conflict with the interests of the Company. Form AOC-2, containing the note on the aforesaid related party transactions is enclosed herewith as Annexure-III.

The Policy on the Related Party T ransactions as approved by the Board is uploaded on the website of the Company.

27. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure -IV. The annual return of the Company would be placed on the website of the Company i.e. www.sibarauto.com.

28. STATE OF AFFAIRS OF THE COMPANY

The State of Affairs of the Company is presented as part of Management Discussion and Analysis Report forming part of this Report.

29. MANAGEMENT DISCUSSION AND ANALYSIS:

Pursuant to Regulation 34 (2) (e) of SEBI (LODR) Regulations, 2015, a report on Management Discussion & Analysis is herewith annexed as Annexure-V.

30. CORPORATE GOVERNANCE REPORT:

Pursuant to Regulation 34 read with Schedule V of SEBI (LODR) Regulations, 2015, a report on Corporate Governance is herewith annexed as Annexure-VI.

31. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 (12) read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company is herewith annexed as Annexure-VII.

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. 120 Lakhs or more, or employees who are employed for part of the year and in receipt of Rs. 8.50 Lakhs or more per month.

The Company does not have any employee who is employed throughout financial year or part thereof, who was in receipt of remuneration in financial year under review which in aggregate, or as the case may be, at a rate which in the aggregate is in excess of that drawn by the Managing Director or Whole time director and holds by himself or along with his spouse and dependent children not less than 2% of the equity shares of the Company.

32. HUMAN RESOURCES:

Your Company considers its Human Resources as the key to achieve its objectives. Keeping this in view, your Company takes utmost care to attract and retain quality employees. The employees are sufficiently empowered and such work environment propels them to achieve higher levels of performance. The unflinching commitment of the employees is the driving force behind the Companys vision. Your Company appreciates the spirit of its dedicated employees.

33. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

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

34. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There were no Material Changes and Commitments Affecting the Financial Position of the Company.

35. ACKNOWLEDGMENT AND APPRECIATION:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, financial institutions, business associates for their consistent support and continued encouragement to the Company.

Further your Directors convey their appreciation for the whole hearted and committed efforts by all its employees.

Your Directors gratefully acknowledge the ongoing co-operation and support provided by the Central and State Governments, Stock Exchanges, SEBI, RBI and other Regulatory Bodies.

By order of the Board of Directors
For Sibar Auto Parts Ltd
Sd/- Sd/-
Place: Tirupati Pemmasani Veeranarayana Pemmasani Madhu Pratap
Date; 27.08.2020 Managing Director Whole-Time Director
DIN:00644259 DIN: 00644254