Ultra Wiring Connectivity Systems Ltd Directors Report.

Dear Members

Ultra Wiring Connectivity System Limited

(Formerly known as Ultra Wiring Connectivity System Private Limited)

Your Directors present the 14th Annual Report (First Report as a Public Listed Company) on the business and operations of Ultra Wiring Connectivity System Limited ("the Company") along with the audited financial statements, for the Financial Year ended March 31, 2019.

1. FINANCIAL PERFORMANCE:

The financial performance of the Company during the year under review is summarised below:

Particulars 2018-19 2017-18
Revenue from Operations 1987.80 1771.96
Other Income 17.71 14.74
Total Income 2005.51 1786.70
Expenses
Production Cost 1198.29 1082.54
Employee Benefit Expenses 233.99 185.85
Finance Cost 22.05 24.04
Depreciation and Amortization expenses 37.83 38.43
Other Expenses 365.59 292.16
Total Expenses 1857.75 1623.05
Net Profit Before Exceptional Items and Tax 147.75 163.65
Exceptional items - -
Net Profit Before Tax 147.75 163.65
Tax Expenses 46.94 45.23
Profit For the Year 100.81 118.41

2. COMPANYS PERFORMANCE REVIEW:

During the year under review, the revenue from operations of the Company is 1987.80 Lakhs as against Rs. 1771.96 Lakhs in the previous year-a growth of 12.18%. The profit before tax of the Company is Rs. 147.75 Lakhs as against Rs. 163.65 Lakhs in the previous year a decline of 9.71%. The Companys policy of product innovation and the range of new products already introduced would yield sustainable profitability in the long run.

3. DIVIDEND:

During the year under review, the Directors have recommended divided of Rs .10 per Equity Share i.e Rate of 1%.

4. HOLDING SUBSIDIARIES AND ASSOCIATES:

The Company does not have any holding, subsidiary and associate Company.

5. TRANSFER TO RESERVES:

During the year under review, the Company has not transferred any amount to Reserves

6. PARTICULARS OF LOANS. GUARANTEE OR INVESTMENT UNDER SECTION 186 OF THE COMPANIES

ACT. 20-13

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013, wherever applicable, are given in the notes to financial statements.

7. OTHER DISCLOSURES UNDER THE COMPANIES ACT. 2013:

I. EQUITY SHARE CAPITAL:

The Company, entered the capital market with its Initial Public Offering (IPO) of 1376000 equity shares of face value of 10/- and at a premium of Rs.25/- per share, aggregating to Rs. 48160000 The holding of promoters is 73.55% and public is 26.45%.

Background on the IPO of the Company

The issue opened for subscription on October 12, 2018 and closed on October 17, 2018 in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.The equity shares have been listed on the SME Emerge Platform of National Stock Exchange of India Ltd (NSE) w.e.f. October 25, 2018. Your Directors are pleased to inform that the IPO of the Company was fully Subscribed. The response from investors was really very encouraging.

ii. EXTRACT OF THE ANNUAL RETURN:

Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014 an extract of Annual Return is annexed herewith in "Annexure-A".

iii. BOARD MEETINGS:

During the year under review, the Board of Directors met 18 (Eighteen) times on April 2, 2018, April 5, 2018, April 23, 2018, May 30, 2018, May 31 2018, July 10 2018, July 16 2018, July 30 2018, July 31 2018, October 23 2018, November 23 2018, December 25 2018, January 3 2019, January 15 2019, March 3 2019, March 18 2019, March 25 2019 and March 30, 2019. The time gap between two Board meetings did not exceed 120 days.

iv. GENERAL MEETINGS:

During the year under review, there was 1 (One) Extra Ordinary General Meeting held on December 28, 2018.

V. COMMITTEES OF THE BOARD:

The Board had constituted various committees which are as follows:

a. Audit Committee:

The Company has constituted an Audit Committee, as per the provisions of Section 177 of the Companies Act, 2013 The Committee presently comprises of following three (3) Directors:

Name of the Directors Status Nature of Directorship
Mr. Aditya Mathur Chairman Non-Executive and Independent Director
Mr. Rajindarr Ahuja Member Non-Executive and Independent Director
Mr. Sanjay Mathur Member Managing Director

The Role and powers of the committee are as under:

1) Overseeing the Companys financial reporting process and the disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.

2) Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal of the statutory auditor and the fixation of audit fees.

3) Approval of payment to statutory auditors for any other services rendered by the statutory auditors.

4) Reviewing, the annual financial statements before submission to the board for approval, with particular reference to:

a. Matters required to be included in the Directors Responsibility Statement in the Boards report in terms of clause (c) of sub-section 3 of Section 134 of the Companies Act, 2013.

b Changes, if any, in accounting policies and practices and reasons for the same.

c. Major accounting entries involving estimates based on the exercise of judgment by management.

d. Significant adjustments made in the financial statements arising out of audit findings.

e. Compliance with listing and other legal requirements relating to financial statements.

f. Disclosure of any related party transactions.

g. Modified opinion(s) in the draft audit report.

5) Reviewing, with the management, the half yearly and annual financial statements before submission to the board for approval.

6) Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.

7) Reviewing and monitoring the auditors independence and performance and effectiveness of audit process.

8) Approval of any transactions of the Company with Related Parties, including any subsequent modification thereof.

9) Scrutiny of inter-corporate loans and investments.

10) Valuation of undertakings or assets of the Company, wherever it is necessary.

11) Evaluation of internal financial controls and risk management systems.

12) Reviewing, with the management, performance of statutory and internal auditors, and adequacy of the internal control systems.

13) Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.

14) Discussion with internal auditors on any significant findings and follow up there on.

15) Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.

16) Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.

17) To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.

18) To review the functioning of the Whistle Blower mechanism, in case the same exists.

19) Approval of appointment of CFO or any other person heading the finance function or discharging that function after assessing the qualifications, experience & background, etc. of the candidate.

20) To overview the Vigil Mechanism of the Company and take appropriate actions in case of repeated frivolous complaints against any Director or Employee.

21) To implement Ind AS (Indian Accounting Standards), whenever required.

22) Monitoring the end use of funds raised through public offers and related matters.

The Audit Committee shall mandatorily review the following information:

1. Management Discussion and Analysis of financial condition and results of operations.

2. Statement of significant related party transactions (as defined by the Audit Committee), submitted by management.

3. Management letters / letters of internal control weaknesses issued by the statutory auditors.

4. Internal audit reports relating to internal control weaknesses.

5. The appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review by the audit committee.

23) Statement of deviations:

a) Half yearly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock exchange(s) in terms of Regulation 32(1).

b) Annual statement of funds utilized for purposes other than those stated in the offer document/ prospectus/notice in terms of Regulation 32(7).

POWERS OF THE AUDIT COMMITTEE:

• Investigating any activity within its terms of reference;

• Seeking information from any employee;

• Obtaining outside legal or other professional advice; and

• Securing attendance of outsiders with relevant expertise, if it considers necessary.

b. Stakeholder Relationship Committee:

The Company has constituted a Stakeholders Relationship Committee as per the provisions of Section 178(5) of the Companies Act, 2013. The Committee presently comprises of following three (3) Directors:

Name of the Directors Status Nature of Directorship
Mr. Aditya Mathur Chairman Non-Executive and Independent Director
Mr. Rajindarr Ahuja Member Non-Executive and Independent Director
Mr. Sanjay Mathur Member Managing Director

The Stakeholder Relationships Committee shall oversee all matters pertaining to investors of our Company. The terms of reference of the Investor Grievance Committee include the following:

1. Redressal of shareholders/investors complaints;

2. Reviewing on a periodic basis the Approval of transfer or transmission of shares, debentures or any other securities made by the Registrar and Share Transfer Agent;

3. Issue of duplicate certificates and new certificates on split/consolidation/renewal;

4. Non-receipt of declared dividends, balance sheets of the Company; and

5. Carrying out any other function as prescribed under the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015.

c. Nomination and Remuneration Committee:

The Company has constituted a Nomination and Remuneration Committee as per the provisions of Section 178 of the Companies Act, 2013. The Committee presently comprises of following three (3) Directors:

Name of the Directors Status Nature of Directorship
Mr. Aditya Mathur Chairman Non-Executive and Independent Director
Mr. Rajindarr Ahuja Member Non-Executive and Independent Director
Mr. Sanjay Mathur Member Non-Executive and Independent Director

ROLE OF THE COMMITTEE:

Role of Nomination and Remuneration Committee are as under:

a) Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board of Directors a policy relating to, the remuneration of the directors, Key Managerial Personnel and other associates.

b) Formulation of criteria for evaluation of performance of Independent Directors and the Board of Directors.

c) Devising a policy on diversity of Board of Directors.

d) Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board of Directors their appointment and removal.

e) Whether to extend or continue the term of appointment of the Independent Director, on the basis of the report of performance evaluation of Independent Directors.

f) Such other matters as may from time to time be required by any statutory, contractual or other regulatory requirements to be attended to by such committee.

vi. CHANGES IN NATURE OF BUSINESS:

There has been no change in the nature of business of the Company during the financial year ended March 31,2019.

vii. RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large and Approval of the Board of Directors & shareholders was obtained wherever required. Further all the necessary details of transaction entered with the related parties are attached herewith in Form No. AOC-2 for your kind perusal and information. (Annexure B).

8. WHISTLE BLOWER POLICY/VIGIL MECHANISM:

In compliance with the requirement of the Companies Act, 2013 and SEBI Listing Regulations, the Company has established a Whistle Blower Policy / Vigil Mechanism Policy and the same is placed on the web site of the Company viz. www.ultrawiring.com

A fraud and corruption free environment in a Company is the objective and in view of that, a Vigil Mechanism (Whistle Blower) Policy has been adopted by the Board for Directors and employees, which is uploaded on the website of the company www.ultrawiring.com pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013. No complaint of this nature has been received by the Audit Committee during the year under review.

9. STATUTORY AUDITORS, THEIR REPORT AND NOTES TO FINANCIAL STATEMENTS AND FRAUD, IF ANY:

As per the requirements of the Companies Act, 2013 the Audit Committee and the Board of Directors at their meeting held on 23.08.2019 Re-appointed M/S. Sanmarks & Associates, Chartered Accountants (Firm Registration No. 003343N) as Statutory Auditors of the Company from the conclusion of this AGM till the conclusion of AGM to be held in 2024.

Further, the report of the Statutory Auditors along with the notes is enclosed with the financial statements. The observations made in the Auditors Report which contains unmodified opinion are self-explanatory and does not contain any qualification/modified opinion. Therefore, it does not call for any further comments. Also the Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

10. SECRETARIAL AUDITOR:

Pursuant to Section 204 of the Companies Act, 2013 the Board of Directors had appointed M/s Abhishek J & Co, Practicing Company Secretary to undertake the Secretarial Audit of the Company for the period 2018-19. The Secretarial Audit Report is attached to this report as "Annexure-C".

Explanation or comments on qualifications, reservations or adverse remarks or disclaimers made by the Practicing Company Secretary in their reports:

Observation Explanation
Non Submission of E-Voting Results to Stock Exchange for the EGM held on 28th December 2018 within 48 hours of conclusion of meeting as required under Regulation 44(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Company obtained E-Voting facility during its EGM dated 28.12.2018 for passing resolution to shift its Registered office. Company filed prior intimation of the said meeting to Stock Exchange on 17.11.2018 and also submitted outcome of the meeting within 24 hours of the conclusion of meeting, however it could not file the e-voting results separately to the exchange due to lack of professional guidance. It is being clarified by the management that such omission was genuinely unintentional without ulterior motive. Management will surely take extra care with such matters so that they never happen again in future and ensure that legal & secretarial compliances are always high on priorities.
Non Filing of E-Form MGT-14 to Registrar of Companies, NCT Delhi & Haryana for resolution passed in Board Meeting held on 10th July 2018 to approve Financial Statements and Director Report for the Financial Year 2017-18 as required under Section 117(3) of the Companies Act 2013. The non-compliance came to notice of Management during internal due diligence of records. said default occasioned due to the fact that concerned person who was entrusted with the job of compliance was keeping unwell and did not attend the office for quite some time therefore the filing got delayed. As soon as management came to notice of the fact, it acted immediately and took necessary steps to make the default good by filing Application to Central Government.

11. UPDATES ON BOARD OF DIRECTORS/KEY MANAGERIAL PERSONNEL (KMP):

a) PERFORMANCE EVALUATION:

In compliance with the Companies Act, 2013, and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the annual evaluation has been carried out by the Board of its own performance, of its committees and Directors by way of individual and collective feedback from Directors. The Directors expressed their satisfaction with the evaluation process.

b) DIRECTORS AND KEY MANAGERIAL PERSONNEL:

The Composition of the Board of Directors and Key Managerial Personnel are as follow.

Sr. No Name of the Director Designation
1. Mr. Sanjay Mathur Managing Director
2. Mrs. Archana Mathur Director
3. Mr. Aditya Mathur Independent Director
4. Mr. Rajindarr Ahuja Independent Director
5. Mr. Prabhat Kumar Bhatia Chief Finance Officer
6. Mr. Shivam Kaushik Company Secretary

During the year under review, Mrs. Natasha Mittal resigned from the Board with effect from March 01, 2019.

RETIREMENT OF DIRECTOR BY ROTATION:

Pursuant to the provisions of Section 152 of the Companies Act, 2013, Mr. Sanjay Mathur , (DIN: 00285032), Managing Director is liable to retire by rotation at the ensuing Annual General Meeting, and being eligible, he has offered himself for re-appointment. Accordingly, the proposal for his re-appointment has been included in the Notice convening the Annual General Meeting of the Company.

A brief resume of Mr. Sanjay Mathur seeking re-appointment is enclosed consisting nature of expertise in specific functional areas and name of companies in which they hold directorship and/or membership/ chairmanships of committees of the respective Boards, shareholding and relationship between directorship inter-se as stipulated under Reg. 36(3) of the SEBI (LODR) Regulations, 2015, are given in the section of notice of AGM forming part of the Annual Report.

c) CODE OF CONDUCT:

The Company has formulated a code of conduct for Board of Directors and Senior Managerial Personnel. The confirmation of compliance of the same is obtained from all concerned on an annual basis. All Board Members and Senior Managerial Personnel have given their confirmation of compliance for the year under review. The code of conduct for Directors and Senior Managerial Personnel is also placed on the website of the Company viz. www.ultrawiring.com.

d) FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:

The Company proactively keeps its Directors informed of the activities of the Company, its management, operations and provides an overall industry perspective as well as issues faced by the industry. The Policy on Familiarization Programme adopted by the Board and details of the same are available on the Companys website under the Investors Relations section at www.ultrawiring.com.

12. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

The Management Discussion and Analysis Report as required under Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this report and is attached as "Annexure-D".

13. MATERIAL CHANGES AND COMMITMENTS

The particulars as required under the provisions of Section 134(3) (l), following changes have occurred which have affected the financial position of the company occurred between 31st March 2019 and the date of Boards Report.

Company made an application to Regional Director; Northern Region for the purpose of shifting its registered office from the State of Delhi to Haryana, Regional Director has confirmed the alteration in Situation Clause of Memorandum of Association to incorporate the change vide its order no.H50191311/13(4)/RD (NR)/2019/6059 dated 26.07.2019.

14. DEPOSITS:

As per Section 73 of the Companies Act, 2013 the Company has not invited/ accepted any deposits from the public during the year ended March 31,2019.

15. CORPORATE SOCIAL RESPONSIBILITY:

The provisions of Section 135 of the Companies Act, 2013 relating to Corporate Social Responsibility is not applicable to the Company as the Company does not fall under the criteria prescribed.

16. CORPORATE GOVERNANCE:

Since the Companys securities are listed on SME Emerge Platform of National Stock Exchange of India Limited, by virtue of Regulation 15 of SEBI (Listing Obligation & Disclosure Requirements) Regulation, 2015 the compliance with the corporate governance provisions as specified in Regulations 17 to 27 and clauses (b) to (i) of subregulation (2) of regulation 46 and Para C, D and E of Schedule V are not applicable to the Company. Hence corporate governance does not form part of this Boards Report.

17. INTERNAL FINANCIAL CONTROL WITH REFERENCE TO FINANCIAL STATEMENTS:

The Company has adequate internal financial control procedure commensurate with its size and nature of business. These controls include well defined policies, guidelines, standard operating procedure, authorization and approval procedures. The internal financial control of the company are adequate to ensure the accuracy and completeness of the accounting records, timely preparation of reliable financial information, prevention and detection of frauds and errors, safeguarding of the assets, and that the business is conducted in an orderly and efficient manner.

18. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE:

During the year under review, there have been no such significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

19. RISK MANAGEMENT:

The Company has developed and implemented a Risk Management Policy which identifies major risks which may threaten the existence of the Company. The same has also been adopted by the Board and is also subject to its review from time to time.

20. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:

In line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has set up Complaints Committee at its workplaces. No complaints have been received during the Financial Year 2018-19.

21. CODE OF CONDUCT FOR THE PREVENTION OF INSIDER TRADING

The Board of directors has adopted the code of internal Procedures and Conduct for regulating, monitoring and reporting trading by designated persons in accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The said code lays down guidelines and procedures to be followed, and disclosures to be made while dealing with the securities of the Company. The Code of fair disclosure of unpublished price sensitive information is available on the Companys website under the Investors Relations section at www.ultrawirinq.com.

22. PARTICULARS OF EMPLOYEE:

The Company has no employee who is in receipt of remuneration of Rs.8,50,000/-per month or Rs. 1,02,00,000/

- per annum and hence the Company is not required to give information under Sub Rule 2 and 3 of Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Disclosure under Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are disclosed in "Annexure D"

23. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION. FOREIGN EXCHANGE EARNINGS AND OUTGO:

A. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION:

The Particulars required under the provisions of Section 134(3) (m) of the Companies Act, 2013 in respect of conservation of energy and technology absorption have not been furnished considering the nature of activities undertaken by the company during the year under review.

B. FOREIGN EXCHANGE EARNINGS AND OUTGO:

The details of foreign exchange earnings and outgo are as under: ( in Rs.)

Particulars 2018-2019
Foreign Exchange Earned 8,33,420.00
Foreign Exchange used for Import Purchase and Capital Goods 2,94,11,053.60

24. REVIEW OF A STATEMENT ON THE USAGE OF THE PROCEEDS OF THE ISSUE:

Your Company has raised funds from Initial Public Offer (IPO) aggregating to 48160000 by issuing 1376000 equity shares at 35/- per share. During the year under review, your company has undertaken expansion at the new plot at IMT Faridabad to manufacture couplers, bulb holders, fuses predominantly for automotive sector. Following is the summary of utilization of IPO proceeds:

S.

No.

Particulars Amt. proposed (in Rs. Lakhs) Amt. utilized (Rs. In Lakhs) Upto 2018-19 Amt. utilized (Rs. In Lakhs)

In 2019-20 (upto 26/6/19)

1. For Construction & Setting up of New Unit at Plot No. 300, Sector-68, IMT, Faridabad, by setting up a parallel production line for manufacture of Connector and New Line for manufacturing of Blade Fuse 301.92 315.53
2. Working Capital Requirement 120.00 126.79 -
3. General Corporate Purposes 19.68 15.07 5.89
4. Issue Expenses 40.00 39.78 0.38
Total 481.60 497.17 6.27

25. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirements under Section 134 (3) (c) of the Companies Act, 2013, with respect to Directors the Directors state that:

a. In the preparation of the Annual Accounts for the period ended March 31,2019, the applicable accounting standards have been followed along with proper explanation relating to material departures;

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 at the end of the financial year and of the profit of the Company for that period;

c. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this 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; and

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

26. ACKNOWLEDGEMENTS:

Your Directors take this opportunity to place on record their appreciation and sincere gratitude to the Banker and other authorities to the Company for their valuable support and look forward to their continued co-operation in the years to come.

Your Directors acknowledge the support and co-operation received from the employees and all those who have helped in the day to day management.

FOR ULTRA WIRING CONNECTIVITY SYSTEM LIMITED

Sd/-
SANJAY MATHUR
CHAIRMAN & MANAGING DIRECTOR
DIN 00285032
Date: AUGUST 23, 2019
Place: Faridabad