Technocraft Industries (India) Ltd Directors Report.
Your Directors have pleasure in presenting, twenty seventh Annual Report on the business and operations of the Company together with the audited accounts for the Financial Year ended March 31, 2019.
(Rs. In Lakhs)
|Revenue from Operations||115,105.30||101,390.12||131,345.94||118,795.44|
|Earnings before Interest, Depreciation and Tax (EBITA)||20,157.89||19,584.14||23,486.26||22,207.68|
|Less: Finance Costs||2,903.14||1,726.54||3,240.39||2,289.25|
|Profit before Tax||14,181.39||15,554.03||16,410.63||16,989.36|
|Less: Tax Expense||3,946.23||4,691.77||4,507.03||4,991.54|
|Profit After Tax||10,235.16||10,862.26||11,903.60||11,997.82|
|Add: Other Comprehensive Income||-47.40||-286.71||-41.64||-279.13|
|Total Comprehensive income carried to Other Equity||10,187.76||10,575.55||12,076.81||11,718.69|
During the Financial Year under review, no dividend was declared.
Buy-Back of Shares
During the Financial Year no shares were bought during the year.
Your Company does not propose to transfer amounts to the General Reserve out of the amount available for appropriation and an amount of Rs. 10,187.76 Lakhs is proposed to be retained in the retained earnings.
As on March 31, 2019 aggregate Reserve and Surplus was Rs. 72,528.77 Lakhs as compare to Rs. 62,317.60 Lakh as on March 31, 2018.
During the year under review the Company has closed the year with total standalone revenue of Rs. 115,105.30 Lakhs. On Consolidated basis the total revenue is Rs. 131,345.94 Lakhs.
Standalone EBITA improved to Rs. 20,157.89 Lakhs, compared to Rs. 19,584.14 Lakhs, of previous year, which is higher by 2.93%. Consolidated EBITA improved to Rs. 23,486.26 Lakhs compared to Rs. 22,207.68 Lakhs, which is higher by 5.76%.
Employee Stock Option Scheme (ESOP)
Your Company does not have any Employee Stock Option Scheme (ESOP).
During the year under review, the Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014, (including any statutory modification(s) or re-enactment(s) thereof for the time being in force);.
Conservation of energy, technology absorption and foreign exchange earnings and outgo
The information relating to the Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo as required to be disclosed under the Companies (Accounts) Rules, 2014, is given in Annexure-I forming part of this Report.
Statutory Auditors of the Company is M/s Dhiraj & Dheeraj (Formerly known as M/s Khandelwal Prakash Murari Bhandari & Co.) Chartered Accountants, Mumbai.
At the 25th Annual General Meeting of the Company, M/s Khandelwal Prakash Murari Bhandari & Co. Chartered Accountants, was appointed as the Statutory Auditors of the Company, to hold office for a term of fiveconsecutive years from the conclusion of the 25th Annual General Meeting till the conclusion of the Annual General Meeting to be held in the year 2022.
During the Financial Year name of the Partnership Firm of the Statutory Auditor was changed from M/s Khandelwal Prakash Murari Bhandari & Co. to M/s Dhiraj & Dheeraj" w.e.f. 28.08.2018.
The Auditors Report to the Members on the Accounts of the Company for the Financial Year ended March 31, 2019 does not contain any qualification, reservation or adverse remark.
Secretarial Audit for the Financial Year 2018-19 was conducted by M/s Pramod Jain & Co, Company Secretaries in Practice in accordance with the provisions of Section 204 of the Act. The Secretarial Auditors Report is attached to this Report as Annexure II. There are no qualifications or observations or remarks made by the Secretarial Auditor in his Report.
In compliance with the provisions of Section 148 of the Act, the Board of Directors of the Company at its meeting held on May 28, 2019 has appointed M/s NKJ & Associates, Cost Accountant as Cost Auditors of the Company for the Financial Year 2019-20.
The Company has made and maintained the cost records for the Financial Year ended March 31, 2019, as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013 and the said cost records were audited by M/s NKJ & Associates, Cost Accountant as Cost Auditors of the Company,
In terms of the provisions of Section 148 (3) of the Act read with Rule 14(a)(ii) of The Companies (Audit and Auditors) Rules, 2014, the remuneration of the Cost Auditors has to be ratified by the members. Accordingly, necessary resolution shall be proposed at the ensuing AGM for ratification of the remuneration payable to the Cost Auditors for Financial Year 2019-20.
Particulars of Loans, Guarantees or Investments
Particulars of Loans, Guarantees and Investments made during the year as required under the provisions of Section 186 of the Act are given in the notes to the Standalone Financial Statements, forming part of the Annual Report.
Also, pursuant to Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations, 2015 (Hereinafter as the "SEBI Listing Regulations"), particulars of Loans/ Advances given to Subsidiaries have been disclosed in the notes to the Standalone Financial Statements, forming part of the Annual Report.
As on March 31, 2019 there were 19 subsidiaries of the Company:
Direct Indian subsidiaries:
1. Technosoft Engineering Projects Limited ("TEPL")
2. Technocraft Tabla Formwork Systems Private Limited
3. Techno Defence Private Limited
Limited Liability Partnership:
4. Shreyan Infra & Power LLP
Direct foreign Subsidiaries:
5. Technocraft International Limited, UK (WOS of the Company) ("TIL-UK")
6. Technocraft Trading Spolka Zoo, Poland (WOS of the Company)
7. Technocraft Australia Pty. Ltd, Australia (WOS of the Company)
8. Anhui Reliable Steel Technology Co Ltd, China (WOS of the Company)
9. Technocraft NZ Limited, New zealand (WOS of the Company)
Step down subsidiaries:
10. Technosoft Engineering, Inc, USA (WOS of TEPL) ("TEI-USA")
11. Technosoft Engineering UK Ltd, UK (WOS of TEPL)
12. Technosoft GMBH, Germany, (Subsidiary of TEPL)
13. Highmark International Trading FZE, UAE (WOS of TIL-UK) ("HITF-UAE")
14. AAIT / Technocraft Scaffold Distribution LLC, USA (Subsidiary of TIL-UK).
15. Crosswall International Trading Ltd., UAE (Subsidiary of HITF-UAE).
16. Technosoft Innovations INC, USA (WOS of TEI-USA)
17. 2045690 Alberta Ltd, Canada [Step Engineering] (Subsidiary of TEI-USA)
18. Technosoft Services, INC.,USA (WOS of TEI-USA)
19. Swift Projects Inc., USA (WOS of 2045690 Alberta Ltd, Canada [Step Engineering])
During the year under review Technocraft NZ Limited has become the new Subsidiary. Further, during the Financial Year under review following company ceased to be subsidiaries of the Company.
1. TIL Marketing Private Limited (Erstwhile TIL Packaging Private Limited) (Direct Subsidiary)
2. Paithan Eco Foods Private Limited (Erstwhile Technocraft Closures Private Limited) (Direct Subsidiary)
3. Swift Engineering Inc., Canada, (which was WOS Subsidiary of HITF-UAE)
Further, Crosswall International Trading Ltd., UAE strike off on December 27, 2018, due to non-renewal, as company has not started its business.
Except the above no other company has become/ceased to be a subsidiary, joint venture or associate during the financial year 2018-19.
Pursuant to Section 129(3) of the Act, a statement containing the salient features of the financial statements of each of the subsidiary in the prescribed form AOC-1 is annexed to the Annual Report the financial statements of the subsidiaries are kept for inspection by the shareholders at the Registered Office of the Company. The said financialstatements of the subsidiaries are also available on the website of the Company www.technocraftgroup.com under the Investors Section.
As required under Rule 8 of the Companies (Accounts) Rules, 2014 the highlights of performance of subsidiaries and their contribution to the overall performance of the company during the period are duly explained in the form AOC-1 read with consolidated financial statement, annexed to the Annual Report.
The Company has also formulated a Policy for determining material subsidiaries, which is uploaded on the website of the Company i.e. www.technocraftgroup.com and can be accessed at http://www.technocraftgroup.com/pdf/Policy-For-Determining-Material-Subsidiary-Companies.pdf
Consolidated Financial Statements
Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Section 129(3) of the Act and SEBI Listing Regulations and prepared in accordance with the Accounting Principles generally accepted in India including the Indian Accounting Standards specified under Section 133 of the Act.
In accordance with the Section 129(3) of the Act, the audited Consolidated Financial Statements are provided in this Annual Report.
Your Company is in compliance with the Corporate Governance guidelines, as laid out in the SEBI Listing Regulations.
As per Regulation 34 (3) read with Schedule V of the SEBI Listing Regulations, a separate section on corporate governance practices followed by the Company, together with a certificate from M/s. Pramod Jain & Co. Company Secretaries, confirming compliance forms an integral part of this Report.
The annual report of the Company contains certificate by the Chief Executive Officerin terms of SEBI Listing Regulations on the compliance declarations received from the Directors and the Senior Management personneland Certificate by M/s. Pramod Jain & Co. Company Secretaries, who have examined the requirements of Corporate Governance with reference to SEBI Listing Regulations and have certified the compliance, as required under SEBI Listing Regulations.
Internal Control systems and their Adequacy
The Company has Internal Control Systems, commensurate with the size, scale and complexity of its operations. The Internal Auditor monitors and evaluates the efficacy and adequacy of internal control systems in the Company, accounting procedures and policies within the Company. Based on the report of internal audit function, process owners undertake corrective action in respective areas and thereby strengthen the controls.Significantobservations and corrective actions thereon are presented to the Audit Committee from time to time.
Internal Financial Controls and their adequacy
The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, 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. The Company has adopted accounting policies, which are in line with the Accounting Standards and the Act.
Extract of the Annual Return
The details forming part of the extract of Annual Return in prescribed Form MGT 9 is annexed hereto as Annexure-III and forms the part of this Report. Annual Report having the extract of Annual Return shall be available on the website of the Company i.e. www.technocraftgroup.com.
During the Financial Year ended March 31, 2019 the Share Capital was Rs. 24,46,16,870/- consisting of 2,44,61,687 Equity Shares of Rs. 10/- each.
During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on March 31, 2019, none of the Directors of the Company holds instruments convertible into equity shares of the Company.
Directors and Key Managerial Personnel
As per the provisions of Section 152 of the Act, Mr. Ashish Kumar Saraf, Whole-time Director& CFO and Mr. Sudarshan Kumar Saraf, Co-Chairman & Managing Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible have offered themselves for re-appointment.
During the financial year 2018-19 Mr. Aubrey Rebello was appointed as Additional Director with effect from May 30, 2018. Further, in the AGM held on September 28, 2018 he was appointed as independent director of the company pursuant to provisions of the Section 149, 150 and 152 of the Act for the period from May 30, 2018 upto May 29, 2023.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of Independence as prescribed under Section 149(6) of the Act and Regulation 16 (1) (b) of the SEBI Listing Regulations.
Details of the Director seeking appointment at the Annual General Meeting, as required in terms of Regulation 36(3) of the SEBI Listing Regulations is provided in the Annexure to the Explanatory Statement to the Notice.
Pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company are Mr. Sharad Kumar Saraf, Chairman & Managing Director, Mr. Sudarshan Kumar Saraf, Co-Chairman & Managing Directors, Mr. Navneet Kumar Saraf, CEO & Whole-time Director, Mr. Ashish Kumar Saraf, Whole-time Director & Chief Financial Officer, Mr. Atanu Choudhary, Whole-time Director and Mr. Neeraj Rai, Company Secretary of the Company. There was no change in the Key Managerial Personnel during the period under review.
The Remuneration and other details of Key Managerial Personnel for the financial year ended March 31, 2019 are mentioned in the Extract of the Annual Return which is attached to the Boards Report.
Meetings of the Board of Directors
The Board of Directors of your Company met 4 (four) times during 2018-19. The Meetings were held on May 30, 2018, August 10, 2018, November 14, 2018 and February 13, 2019. The time gap between any two consecutive meetings did not exceed one hundred and twenty days.
As on the date of the Board Report the Audit Committee comprised of fiveIndependent Directors namely Mr. Vinod Agarwala (Chairman), Mr. Aubrey Rebello, Mr. Jagdeesh Mal Mehta, Mr. Vishwambhar C. Saraf and Ms. Vaishali Choudhari, all the recommendations made by the Audit Committee were accepted by the Board.
Whistle Blower Policy/ Vigil Mechanism
In Compliance with the provisions of Section 177 of the Act and Regulation 22 of the SEBI Listing Regulations the Company has a Whistle Blower Policy (the "WB Policy") with a view to provide vigil mechanism to Directors, employees and other stakeholders to disclose instances of wrongdoing in the workplace and report instances of unethical behavior, actual or suspected fraud or violation of the Companys code of conduct or ethics policy. The WB Policy also states that this mechanism should also provide for adequate safeguards against victimization of Director(s)/ Employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower Policy has been posted on the website of the Company at the link http://www.technocraftgroup.com/pdf/ Whistle-Blower-Policy.pdf.
Nomination and Remuneration Committee
As on the date of the Board Report, the Nomination and Remuneration Committee comprised of five Independent Directors namely Mr. Vishwambhar C. Saraf - (Chairman), Mr. Vinod Agarwala, Mr. Jagdeesh Mal Mehta, Ms. Vaishali Choudhari and Mr. Aubrey Rebello, members of the committee.
Nomination and Remuneration Policy
The Nomination and Remuneration Policy recommended by the Nomination and Remuneration Committee is duly approved by the Board of Directors of the Company and the Remuneration Policy of the Company is attached to the Boards Report as Annexure-IV.
Corporate Social Responsibility (CSR)
Pursuant to Section 135 of the Act a Corporate Social Responsibility (CSR) Committee was constituted. As at March 31, 2019, the CSR Committee comprised of two Executive Directors and one Independent Director namely Mr. Sharad Kumar Saraf, Mr. Sudarshan Kumar Saraf and Ms. Vaishali Choudhari.
Corporate Social Responsibility Policy recommended by CSR Committee of the Directors has been approved by the Board of Directors of the Company. The same is available on the website of the Company i.e. www.technocraftgroup. com and also attached to this Report as Annexure-V.
The disclosure relating to the amount spent on Corporate Social Responsibility activities of the Company for the financial year ended March 31, 2019 is attached to this Report as Annexure-VI.
Transfer of unclaimed / unpaid dividend to Investor Education and Protection Fund (IEPF)
In accordance with the provisions of Sections 124, 125 and other applicable provisions, if any, of the Companies Act, 2013, read with the Investor Education Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as "IEPF Rules") (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), the amount of dividend remaining unclaimed or unpaid for a period of seven years from the date of transfer to the unpaid dividend account is required to be transferred to the IEPF, maintained by the Central Government.
In pursuance of this, the dividend remaining unclaimed or unpaid in respect of dividends declared upto the financial year ended March 31, 2011 have been transferred to the IEPF. The details of the unclaimed dividends so transferred are available on the Companys website, www.technocraftgroup.com and in the website of the Ministry of Corporate Affairs at www.mca.gov.in
It may be noted that the unclaimed dividend for the financial year 2011-12 declared on September 28, 2012, is due to be transferred to the IEPF by November 4, 2019. The same can however be claimed by the Members before it. Members who have not encashed the dividend warrant(s) from the financial year ended March 31, 2012 onwards may forward their claims to the Companys Registrar and Share Transfer Agents before they are due to be transferred to the IEPF.
In accordance with Section 124(6) of the Act, read with the IEPF Rules, all the shares in respect of which dividend has remained unclaimed or unpaid for seven consecutive years or more are required to be transferred to the demat Account of the IEPF Authority. Accordingly, all the shares in respect of which dividends were declared upto the financial years ended March 31, 2011 and remained unpaid or unclaimed were transferred to the IEPF. The details of such shares transferred have been uploaded in the Companys website www.technocraftgroup.com.
The shares and unclaimed dividend transferred to the IEPF can however be claimed back by the concerned shareholders from IEPF Authority after complying with the procedure prescribed under the IEPF Rules. The Member/Claimant is required to make an online application to the IEPF Authority in Form IEPF -5 (available on www.iepf.gov.in)
During the year under review, the Company has transferred a sum of Rs.177,289.00 to Investor Education and Protection Fund (IEPF) pursuant to Section 125 of the Companies Act, 2013. The said amount represents dividend for the Financial Year 2010-11 which remained unclaimed by the members of the Company for a period exceeding 7 years from its due date of payment. During the Financial Year the Company has also transferred 484 Equity Shares of 9 Shareholders into IEPF, pursuant to Section 124(6) of the Act.
Particulars of contracts or arrangements with related parties
All related party transactions entered during the year were in the ordinary course of business and on an arms length basis.
All transactions with Related Parties are placed before the Audit Committee as also the Board for approval, if required. Prior omnibus approval of the Audit Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature. The transactions entered into pursuant to the approvals so granted are subjected to audit and a statement giving details of all related party transactions is placed before the Audit Committee on a quarterly basis. The statement is supported by a certificate from the CFO.
The policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the Companys website and can be seen at the link https://www.technocraftgroup.com/pdf/Policy-On-Related-Party-Transactions.pdf All transactions entered into with related parties during the year were on arms length basis and were in the ordinary course of business. The details of the material related party transactions entered into during the year as per the policy on Related Party Transactions approved by the Board have been reported in Form AOC 2 annexed to the Directors Report as Annexure-VII.
Further the details of the transactions with related parties are provided in the Companys financial statements in accordance with the Accounting Standards.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is available on website of the Company at the link: http://www.technocraftgroup.com/pdf/Policy-On-Related-Party-Transactions.pdf
Particulars of Employees and other additional information
Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, form part of this Report and are annexed as Annexure-VIII.
The information as required under Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided on the request by any member of the Company. In terms of Section 136 (1) of the Companies Act, 2013, the Report and the Accounts are being sent to the members excluding the said Annexure.
Any member interested in obtaining copy of the same may write to the Company Secretary at the Registered Office of the Company.
Risk management policy
Pursuant to the requirement of Section 134 (3) (n) of the Act, the Company has in place a structured risk management policy. The Risk management process is designed to safeguard the organisation from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business.
Pursuant to the provisions of Section 134 (3) (p), 149(8) and Schedule IV of the Act and Regulation 17 of the SEBI Listing Regulations, annual Performance Evaluation of the Directors as well as of the Committees of the Board has been carried out, same has been explained in detail in the Corporate Governance Report, enclosed herewith.
Independent Directors Meeting
During the financial year under review, the Independent Directors of the Company met on February 13, 2019 inter-alia, to discuss:
i) Evaluation of performance of Non-Independent Directors and the Board of Directors of the Company as a whole.
ii) Evaluation of performance of the Chairman of the Company, taking into view of Executive and Non-Executive Directors.
iii) Evaluation of the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties.
Further the Independent Directors were also met on May 28, 2019 to discuss the above.
Directors Responsibility Statement
In accordance with the provisions of Section 134 (5) of the Act, your Directors based on the representation/confirmation received from the Chairman and from the Chief financial Officer, confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any.
b) the selected accounting policies were applied consistently and the Directors 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) proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) the annual accounts have been prepared on a going concern basis.
e) the internal financial controls have been laid down to be followed by the Company and such controls are adequate and are operating effectively.
f) proper systems to ensure compliance with the provisions of all applicable laws have been devised and such systems are adequate and are operating effectively.
Requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules made thereunder, your Company has constituted an Internal Complaints Committee (ICC). During the year under review, no cases were received/ filed pursuant to the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
Material changes & commitment if any, affecting financial position of the Company from the end of financial year till the date of the report.
There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the Financial Statements relate and the date of this Report.
Reporting of Frauds:
There have been no instances of fraud reported by the Statutory Auditors under Section 143(12) of the Act and Rules framed thereunder either to the Company or to the Central Government.
Familiarization Programmes for Board Members
The Familiarization program aims to provide insight to the Independent Directors to understand the business of the Company. Upon induction, the Independent Directors are familiarized with their roles, rights and responsibilities.
All the Directors of the Company are updated as and when required, of their role, rights, responsibilities under applicable provisions of the Companies Act and the SEBI Listing Regulations, Secretarial Standards; nature of industry in which the Company operates, business model of the Company, etc. The Company holds Board and the Committee Meetings from time to time. The Board of Directors has complete access to the information within the Company. The Independent Directors have the freedom to interact with the Companys management. Directors are also informed of the various developments in the Company through various modes of communications. All efforts are made to ensure that the Directors are fully aware of the current state of affairs of the Company and the industry in which it operates.
The details of such familiarization programmes for Independent Directors of the Company are posted on the website of the Company http://www.technocraftgroup.com/pdf/Details-of-the-familiarization-programmes-imparted-to-independent-directors.pdf
Pursuant to Section 118(10) of the Companies Act, 2013 the Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings;
Significant and material Orders passed by the Regulators/Courts, if any material orders passed by the Regulators / Courts which would impact the going concern status Therearenosignificant of your Company and its future operations.
Your Directors would like to acknowledge and place on record their sincere appreciation to all stakeholders, clients, Financial Institutions, Bank, Central and State Governments, the Companys valued investors and all other business partners for their continued co-operation and excellent support received during the year.
Your Directors recognize and appreciate the efforts and hard work of all the employees of the Company and their continued contribution to its progress.
|Registered Office:||For and on behalf of the Board of Directors|
|Plot No. 47, Opus Centre, Second Floor,|
|Central Road, MIDC, Andheri (East),|
|Mumbai 400093.||Sharad Kumar Saraf|
|CIN: L28120MH1992PLC069252||Chairman & Managing Director|
|Date: May 28, 2019|