To,
The Members SNL Bearings Limited
Your Directors have pleasure in presenting their Forty-Third Annual Report together
with Audited Financial Statements for the year ended March 31, 2023.
1. Financial Results
Particulars |
Year ended March 31, 2023 |
Year ended March 31, 2022 |
|
(Rs. in Lakhs) |
(Rs. in Lakhs) |
| Revenue from operations (Net) |
4,787 |
4,351 |
| Profit before tax |
1,113 |
1,176 |
| Provision for taxation: |
|
|
| Current tax (net) |
266 |
275 |
| Deferred tax |
18 |
18 |
| Tax pertaining to earlier years |
11 |
- |
| Profit after taxation |
818 |
883 |
| Add: Balance brought forward |
3,471 |
2,740 |
| Add: Other Comprehensive Income for the year |
(11) |
11 |
|
4,278 |
3,634 |
| Appropriation: |
|
|
| Dividend |
235 |
163 |
| Profit & Loss Account |
4,043 |
3,471 |
2. Dividend
Based on the Companys performance, your Board of Directors are pleased to recommend a
final dividend of Rs. 6.50/- per equity share (i.e. 65.00%) of face value of Rs. 10/- each
involving an outgo of Rs. 235 lakhs for the FY 2022-23, subject to approval of the Members
at the ensuing Annual General Meeting.
Your Directors have proposed not to transfer any sums to the General Reserve.
3. State of Companys Affairs, Operations & Future Outlook
Demand in the Indian automotive market in FY23 continued the growth trajectory from the
previous year. The light vehicles segment recorded highest production levels since 2018
with many successful new model launches. The two wheelers and tractors segments were
sluggish as rural incomes have not fully recovered post pandemic. On the raw material
side, prices remained elevated during the year. Process re-engineering, automation and
digitization with a view to improve operations went on as planned.
Further, as we exit FY 22-23, we are better placed than we were at the start clocking
full year revenues of Rs. 4787 lakhs in FY 22-23, growing 10% over the previous year
though profits after tax have decreased by 7% to Rs. 818 lakhs (previous year Rs. 883
lakhs) mainly because of increase in cost of material.
Future Outlook
Recovery in global growth will largely be a function of how countries contain the
pandemic and bounce back from its negative impact. Access to medical interventions,
effectiveness of monetary policy support, exposure to cross-country business are important
to drive the recovery.
FY 2024 is likely to be a better year with several economic indicators such as power
demand, rail freight, e-way bills, GST collection, steel consumption, among others
trending positively and could lead economic recovery. Favorable Government policies to
support the Indian manufacturing industry and the emphasis on spending for building
infrastructure for roads and mass rail transportation, vehicle scrappage policy and
forecasts of a normal monsoon which will aid rural income are all expected to aid demand
for new vehicles. Continuous innovations and new launches, by way of hybrid fuel efficient
vehicles will further propel demand and allow the industry time to adjust their production
facilities to meet the new requirements for the introduction of Electric vehicles, which
are expected to constitute a reasonable proportion of vehicle production between 2025 and
2030.
4. Finance
Rating of your Company has been reaffirmed as CRISIL A1 for the short-term bank
facilities and CRISIL A Stable for the Companys long-term facilities as on March 8, 2023.
The Company continues to focus on judicious management of its working capital.
Receivables, inventories and other working capital parameters are continuously monitored.
a. Public Deposits
During the year, the Company has not accepted any deposits from the public/ Members
under Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits)
Rules, 2014. As on March 31, 2023, there are no fixed deposits with the Company.
b. Particulars of Loans, Guarantees or Investments
During the year under review, the Company has not advanced any loans, given guarantees,
only certain investments of temporary surplus funds in the units of Mutual Funds and Fixed
Deposits of NBFCs have been made with the Boards approval.
During the year under review the Company has not provided any loans or advances to
firms/ Companies in which Directors are interested.
5. Directors and Key Managerial Personnel
In accordance with the provisions of Section 152 and the Articles of Association of the
Company, Mr. Satish Rangani (DIN: 00209069) will retire by rotation at the ensuing Annual
General Meeting of the Company and being eligible, has offered himself for re-appointment.
During the year under review, Mr. Claude Alex DGama Rose (DIN: 01494440) was
re-appointed as a Director in the category of Independent Director for a second term of 5
(five) years w.e.f. May 17, 2023 by the Board of Directors at their meeting held on May
24, 2022 which was regularized by the Members at the AGM held on September 6, 2022.
Further, Mr. Vivek Sahai (DIN: 01717502) ceased to be Director of the Company w.e.f.
November 7, 2022 due to completion of his term of 5 (five) years and Ms. Reshmi Panicker
was appointed as a Director in the category of Independent Director for a term of 5 (five)
years w.e.f. February 9, 2023 by the Board of Directors at their meeting held on February
9, 2023 which was regularized by the Members by passing special resolution through postal
ballot on April 13, 2023.
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
16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and
they are not debarred or disqualified from being appointed as Director of companies by
SEBI/ Ministry of Corporate Affairs or any such statutory authority. The composition of
the Board duly meets the criteria stipulated in Section 152 of the Companies Act, 2013 and
Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 ("SEBI LODR/Listing Regulation").
Key Managerial Personnel
Pursuant to the provisions of Sections 2(51) and Section 203 of the Companies Act, 2013
read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014,
the following are the Key Managerial Personnel:
Mr. Krishna Kant Prasad Sinha |
- Chief Executive Officer |
Mr. Ram Narayan Sahu |
- Chief Financial Officer |
Mr. Harshal Anant Patil |
- Company Secretary and Compliance Officer |
Board evaluation
For FY 2022-23, the Board has carried out an annual performance evaluation for itself
and that of its Committees and individual directors, using various performance evaluation
criteria in the forms circulated to and filled in by the directors. The feedback has been
shared and discussed. The Independent Directors have met separately on March 24, 2023, and
they have conveyed to the Chairperson of the Board, their satisfaction with the working of
the Board.
Familiarization Programme for Independent Directors
In order to familiarize the Independent Directors with the business, the Company makes
a presentation covering nature and scope of business, nature of industry in which Company
operates, profitability and future scope. At meetings regular updates are given to the
Board, by the Companys senior management in areas of operations, industry and regulatory
trends, competition and future outlook. The familiarization programme is posted on the
website of the Company at www.snlbearings.in.
Remuneration policy
The Board has on the recommendation of the Nomination & Remuneration Committee
framed a policy for selection and appointment of Directors, senior management and to fix
their remuneration. As part of its policy the Company strives to ensure that the
remuneration to Directors, KMPs and Senior Management involves a balance between fixed
and incentive pay, reflecting short and long term performance objectives appropriate to
the working of the Company and its goals. The remuneration policy is posted on the
Companys website at www.snlbearings.in.
Details of remuneration paid to Directors, KMP and the Independent Directors forms part
of the Corporate Governance Report attached to this Report.
Meetings
During the year, 4 (four) Board meetings were convened and held (details in Corporate
Governance Report). The date for the next meeting is fixed in advance at the previous
meeting for both Board and Committee meetings.
6. Subsidiary, Associate and Joint Venture Companies
As of March 31, 2023, the Company does not have any Subsidiary, Associate and Joint
Venture Companies.
7. Business Risk Management
The Company has in place an enterprise risk management framework to identify risks and
minimize their adverse impact on business and strives to create transparency which in turn
enhances the Companys competitive advantage. The Company has broad based its customer
base and brought down the high share of sales to the holding Company and is working
towards progressively reducing this share. The risk to operations arising from the expiry
of leases in respect of certain portions of the Companys factory land and buildings as
the Lessor is under liquidation proceedings by the Official Liquidator in the Delhi High
Court, still continues as the High Court order could affect operations. As part of its
action plan for risk mitigation, the Company has been successfully impleaded in the
proceedings and has filed its application seeking certain reliefs. The Company is hopeful
that there will be a favorable outcome to its offer to renew the leases for reasonable
terms and at favorable rates.
8. Conservation of energy, technology absorption, foreign exchange earnings and
outgo
Information pursuant to Section 134(3)(m) of the Companies Act, 2013 and Rule 8 of
Companies (Accounts) Rules 2014 are given as below:
a. Measures taken for conservation of energy
During the year, the Company has taken few energy savings actions as below:
1. Replaced eight numbers of 500W Halogen street lamps with 50W LED Lamp. This has
resulted in energy saving 36 KWH per day and thus saving of Rs. 90,000 per year.
2. 3 nos of 2HP pump used for circulating water for cooling purpose on machines
replaced with 0.5 HP pump. This has resulted in energy saving of 54 KWH per day and thus
saving of Rs. 1.35 Lakhs per annum.
b. Technology absorption
With the objective of improving productivity as well as quality, during the year the
Company has continued its efforts on improvements in process parameters and reduction in
cycle times. Improvements made on machines and many new products have been developed for
prestigious export and domestic customers. The Company has developed combined bearing for
export and sales cages from welded route. Upgradation of technology is a key focus area
and the Company has initiated necessary mapping of its machines with this objective and
management is taking all efforts towards developing low cost technological solutions.
c. Foreign exchange earnings & outgo for the year ended March 31, 2023
Foreign Exchange Earnings |
: Export of goods |
- Rs. 106 Lakhs |
Foreign Exchange Outgo |
: Raw materials & Components |
- Rs. 646 Lakhs |
9. Industrial Relations / Vigil Mechanism and Whistle Blower Policy
During the year, the Company maintained cordial relations with the workmens unions.
Regular training programs are conducted for imparting understanding of bearing and
engineering principles, modern manufacturing practices and in attitudinal and behavioral
aspects.
The Company has formulated and implemented the Whistle Blower Policy/ Vigil Mechanism.
This has provided a mechanism for Directors and employees of the Company and other persons
dealing with the Company to report to the Chairperson of the Audit Committee, any instance
of unethical behavior, actual or suspected fraud or violation of the Companys code of
conduct. More details about this Policy are given in the Corporate Governance Report,
which forms part of this Annual Report. The Whistle Blower Policy is available on the
Companys website viz. www.snlbearings.in.
Your Company hereby affirms that no complaints were received during the year.
10. Safety, Health & Environment
The Company is committed for establishing and maintaining safe working environment that
promotes good health and high performance of the employees and simultaneously takes
measures to protect the environment. We also ensure that safety behavior is well
demonstrated by our employees while working on the shop floor by using personal protective
equipments as required.
The Companys plant at Ranchi has been awarded internationally recognized external
certification viz. ISO14001:2015 (for adherence to environmental processes), ISO 45001:
2018 (for Health & Safety) and IATF:16949:2015 (quality management system).
Work force is trained at regular intervals in preventive aspects of safety and
prevention of work related accidents, by insisting upon usage of prescribed Personal
Protection Equipments (PPEs) and regular sanitization of the workplace. Besides creating
general awareness among employees towards environmental protection, the management
encourages initiatives which are targeted towards conserving natural resources and
improvements in resource efficiency across all processes.
11. Corporate Social Responsibility
In line with the activities specified in schedule VII relating to the provisions of
sections 135 of the Companies Act, 2013, your Company has been focusing on:
• Promotion of education (particularly for the underprivileged children and girl
child)
• Employment enhancing vocational skills
• Promoting social business projects
• Contribution to funds set up by Central/ State Governments for social economic
development and relief.
During the year under review, an aggregate amount of Rs. 15.50 Lakhs have been
contributed to various organizations doing commendable work for the cause of promoting
education and social business projects for the under privileged sections of society viz;
i. Sankalp (A pledge to change) - Running schools providing education to the
poor sections of society in slums in and around Jamshedpur, Dhanbad and other backward
areas of Jharkhand.
ii. Ugam Foundation - Runs the Kasturba Gandhi Balika Vidyalaya (KGBV) scheme
which was launched by the Government of India in August 2004 for setting up residential
schools at upper primary level for girls belonging predominantly to the SC, ST, OBC and
minorities in difficult areas. Over the next three years, they expected to cover 10KGBV,
150 teachers and 3900 girls students. At the Companys request, the Foundation has
successfully completed signing of the work order with the district education department
and started conducting programmes at KGBV, Mandar located in Ranchi, close to the SNL
Plant.
iii. Indian Cancer Society - Indian Cancer Society is committed in extending
holistic knowledge, treatment and rehabilitation through its "Rise Against
Cancer" movement. Their activities encompass the entire continuum of Cancer Care -
cancer awareness, screening for early detection, financial help for treatment, support
groups, rehabilitation of cancer survivors, registry, research & education.
The Annual Report on CSR activities in pursuance of the Companies (Corporate Social
Responsibility Policy) Rules, 2014 is annexed herewith as Annexure I.
12. Corporate Governance
Pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a
Management Discussion and Analysis report, Corporate Governance report and Auditors
Certificate regarding compliance of conditions of Corporate Governance are made part of
the Annual Report. Details of Board meetings held during the year under review and the
composition of the various committees are included therein.
The Code of Conduct for Directors and Senior Management personnel of the Company, as
approved by the Board, has been affirmed on an annual basis by all the Directors, Company
Secretary, Chief Financial Officer and the Chief Executive Officer of the Company. All
Independent Directors have also submitted a certificate confirming that they meet the
criteria of independence as provided under section 149 of the Companies Act, 2013.
The relevant certification on the various matters specified under Regulation 17(8) of
SEBI (LODR) Regulations, 2015 has been done by CEO and CFO.
During the year under review, the Company has complied with all the applicable
Secretarial Standards.
All pecuniary relationships or transactions of the Non-Executive Directors vis-a-vis
the Company along with criteria for such payments and disclosures on the remuneration of
Directors along with their shareholding are disclosed in Form MGT-9, which forms a part of
this Report.
There are no relationships between the Directors inter-se.
13. Extract of Annual Return
The details forming part of the extract of the Annual Return (MGT-9) is annexed
herewith as Annexure II.
14. Directors Responsibility Statement
Pursuant to the requirements under Section 134(3)(c) of the Companies Act, 2013, your
Directors state that:
i. in the preparation of annual accounts, the applicable Accounting Standards have been
followed along with proper explanations relating to material departures, if any, have been
furnished;
ii. the accounting policies have been selected and these have been applied consistently
and judgments and estimates made thereon 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, 2023 and of the
profit of the Company for that period;
iii. proper and sufficient care for the maintenance of adequate accounting records has
been taken 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;
iv. the Annual Accounts have been prepared on a going concern basis.
v. internal financial controls have been laid down and being followed by the Company
and that such financial controls are adequate and are operating effectively.
vi. proper systems to ensure compliance with the provisions of all applicable laws have
been devised and that such systems are adequate and operating effectively.
15. Related Party transactions (RPT)
All RPT that were entered into during the financial year were on an arms length basis
and were in the ordinary course of business. The Company had obtained approval of the
Members of the Company for material RPTs entered with its holding Company M/s. NRB
Bearings Limited, by way of an ordinary resolution through postal ballot on March 30,
2022. There were no other materially significant RPT by the Company with Promoters,
Directors, Key Managerial Personnel or other designated persons.
All RPT are placed before the Audit Committee as well as the Board for approval. Prior
approval of the Audit Committee is obtained for transactions which are foreseen and
repetitive in nature. Prior approval of Board and/or Members is obtained whenever
necessary. The compliance of the transfer pricing norms in relation to such transactions
is certified by the tax advisors.
The RPT policy as approved by the Board is uploaded on the Companys website viz.
www.snlbearings.in. The particulars of contracts or arrangements with related parties
referred to in Section 188 (1) of the Companies Act, 2013 in Form AOC-2 pursuant to
Section 134 (3) (h) of the Companies Ac, 2013 is annexed herewith as Annexure-III to
this Report.
16. Internal Financial Control Systems and Adequacy
There are adequate internal financial controls in place with reference to the financial
statements. The upgraded ERP system provides reports to validate the required internal
finance controls. Further improvements by way of biometric attendance and linked leave
records and payroll systems have been implemented with existing system. The Internal
Auditors have been regularly reviewing the same, and their recommendations for
improvements have been included in the ERP upgrade implementation. During the year under
review, these controls were evaluated and no significant weakness was identified either in
the design or operation of the controls. This formalized system of internal control
facilitates effective compliance of Section 138 of the Companies Act, 2013 and the Listing
Regulations.
Your Companys Statutory Auditors have, in their report, confirmed the adequacy of the
internal control procedures.
17. Particulars of Employees
In terms of the provisions of Section 197(12) of the Companies Act, 2013, there are no
employees of the Company drawing remuneration in excess of the limits set out in the said
provision.
The disclosure pertaining to remuneration and other details as required under Section
197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as Annexure IV.
18. Auditors Statutory Auditor
The first term of appointment of M/s. Walker Chandiok & Co. LLP, Chartered
Accountants as Auditors was approved till conclusion of 43rd Annual General Meeting held
for Financial Year ended March 31, 2023. The Audit Committee and the Board of Directors
recommended for reappointment of M/s. Walker Chandiok & Co. LLP, Chartered Accountants
as statutory auditors and suitable resolution for the same has been included in the AGM
notice annexed. A certificate from M/s. Walker Chandiok & Co. LLP has been received to
the effect that their appointment, if made would be within the limits prescribed under
section 139 of the Companies Act, 2013.
Cost Auditor
Pursuant to the provisions of Section 148 of the Companies Act, 2013 and the Companies
(Cost Records and Audit) Rules, 2014, the nature of products manufactured by the Company
and based on the criteria laid down under the aforesaid rules, Cost Audit is not
applicable to your Company. However, from FY 2018-19, maintenance of prescribed Cost
records is applicable to your Company and accordingly such accounts and records are made
and maintained by the Company.
Secretarial Auditor
Pursuant to the provision of section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has
appointed Mr. Upendra Shukla, Practicing Company Secretary, to carry out the Secretarial
Audit of the Company for FY 2022-23. The report of the Secretarial Auditor is annexed
herewith as Annexure V.
Explanation or Comments on disqualifications, reservations, adverse remarks or
disclaimers in the auditors reports
There have been no disqualifications, reservations, adverse remarks, or disclaimers in
the statutory auditors reports.
The Secretarial Audit Report contains the observation regarding non-composition of
Board as per SEBI (LODR) Regulations, 2015 for two days. It was clarified that there was
inadvertent delay of two days in scheduling the Board meeting for appointment of new
Director Ms. Reshmi Panicker, which caused delay in compliance with respect to composition
of Board as per applicable Regulations of SEBI LODR.
19. Significant and Material Orders passed by the Regulators or the Courts or the
Tribunals
There are no orders passed by the Regulators or Courts or Tribunals impacting the going
concern status of the Companys operation.
20. Details of application made or any proceeding pending under the Insolvency and
Bankruptcy Code, 2016 during the year along with their status.
The Company has not made any application under the Insolvency and Bankruptcy Code, 2016
during the financial year 2022-23.
21. Details of difference between amount of the valuation done at the time of
one-time settlement and the valuation done while taking loan from the Banks or Financial
Institutions along with the reasons thereof
The provision regarding difference between amount of the valuation done at the time of
one-time settlement and the valuation done while taking loan from the Banks or Financial
Institutions is not applicable to the Company during the financial year 2022-23.
22. Change in nature of business
During the year under review, there was no change in the nature of the business carried
on by the Company.
23. Disclosure under Sexual Harassment of Women at the Workplace (Prevention,
Prohibition and Redressal) Act, 2013
In accordance with the provisions of the Sexual Harassment of Women at the Workplace
(Prevention, Prohibition and Redressal) Act, 2013, the Company is not required to setup
Internal Complaints Committees (ICC) to redress complaints as the Company has no women
employee and during the year under review there were no complaints received by the
Company.
24. Material changes and commitments, if any, affecting the financial position of
the Company
There are no material changes and commitments affecting the financial position of the
Company which have occurred between the close of the financial year on March 31, 2023 to
which the financial statements relate and the date of this Report.
25. Acknowledgements
The Board wishes to acknowledge and express their gratitude for the whole hearted
support and co-operation extended by the members, NRB group, Companys bankers, customers,
suppliers and all employees of the Company for their efforts during the year.
|
For and on behalf of the Board of Directors |
|
SNL Bearings Limited |
Place : Mumbai |
Harshbeena Zaveri |
Date : May 23, 2023 |
Chairperson |
+91-9892691696
