veto switchgears cables ltd Directors report
Dear Members,
The Board of Directors are elated to present the 16th Annual Report of the business and operations of your Company along with the Audited Financial Statements for the Financial Year ended 31 st March, 2023 and other accompanying reports, notes and certi icates.
FINANCIAL HIGHLIGHTS
The Companys financial performance (standalone and consolidated) for the year ended March 31st, 2023 along with previous years iigures are summarized below:
| Consolidated | Standalone | |||
| Particulars | 2022-23 | 2021-22 | 2022-23 | 2021-22 |
| Revenue from Operations (including other Income) | 29551.09 | 27038.46 | 20895.15 | 18397.09 |
| Less Expenses : | ||||
| (a) Cost of materials consumed | 11292.65 | 11568.32 | 7454.56 | 7184.96 |
| (b) Purchases of stock-in-trade | 8746.97 | 8783.61 | 6796.14 | 5586.28 |
| (c) Changes in inventories of fiinished goods, and stock-in- trade | 1417.24 | (714.81) | 36.23 | (622.65) |
| (d) Employee bene its expense | 1886.45 | 1647.89 | 1112.08 | 1076.80 |
| (e) Finance costs | 478.24 | 395.05 | 380.89 | 323.37 |
| (f) Depreciation and amortisation | ||||
| Expense | 282.13 | 333.40 | 233.09 | 257.91 |
| (g) Other expenses | 2405.87 | 2045.38 | 1774.11 | 1514.42 |
| Total expenses | 26509.54 | 24058.83 | 17787.10 | 15321.08 |
| Profit before tax and Share of Profit of an Associate | 3041.54 | 2979.63 | 3108.03 | 3076.00 |
| Less: Exceptional items | - | - | - | - |
| Profit before tax | 3041.54 | 2979.63 | 3108.03 | 3076.00 |
| Less: Tax | 996.18 | 960.66 | 823.26 | 813.99 |
| Profit for the year | 2045.36 | 2018.96 | 2284.79 | 2262.02 |
| Other Comprehensive Income | 191.37 | 73.42 | 5.17 | 7.54 |
| Total comprehensive income for the year, net of tax | 2236.74 | 2092.38 | 2289.96 | 2269.56 |
The standalone and the consolidated financial statement have been prepared in accordance with the Indian Accounting Standards (Ind AS). Balancing with customer wants we managed to meet their requirements and we strive to do so in upcoming years. By encouraging performance of our employees we achieved revenue growth of Rs. 2512.63 Lakhs and we concluded the year with positive revenue and a Profit hike of Rs. 26.40 Lakhs .
FINANCIAL PERFORMANCE
Consolidated Financial Results
During the year under review on consolidated basis our Company earned Profit before tax of Rs. 3041.54 Lakhs against Rs. 2979.63 Lakhs in the previous year. The Company earned Profit for the year of Rs. 2045.36 Lakhs as compared to Rs. 2018.96 Lakhs in the previous year. The Company had Revenue from operations of Rs. 29110.69 Lakhs as compared to 26724.00 Lakhs in the previous year. The Profit before Interest/Depreciation/Tax (PBDIT) was Rs. 3801.91 Lakhs as compared to Rs. 3708.08 Lacs in the previous year.
Revenue from Operations (In Lacs)
STANDALONE FINANCIAL RESULTS
During the year under review our Company earned Profit before tax of Rs. 3108.03 Lakhs against Rs. as 3076.00 Lakhs in the previous year. The Company earned Profit after tax of Rs. 2284.79 Lakhs compare to Rs. 2262.02 Lakhs in the previous year. The Company has Income from operation of Rs. 19606.47 Lakhs as compared to Rs. 17365.84 Lakhs in the previous year. The Profit before Interest/Depreciation/Tax (PBDIT) was Rs. 3722.01 Lakhs as compared to Rs. 3657.28 Lakhs in the previous year.
Keeping in view the dynamic environment, the company has made efforts to improve ef iciency, productivity and Profitability. The management seeks trust of shareholders in future growth of the Company and is willing to do all possible aspects for enhancement of shareholders wealth.
INDIAN ACCOUNTING STANDARDS
The standalone and consolidated financial statements of the Company for the financial year ended March 31st 2023, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as noti ied by the Ministry of Corporate A airs and as amended from time to time.
FINANCIAL STATEMENTS
In accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as ‘Listing Regulations) and Section 136 of the Companies Act, 2013 read with Rule 10 of the Companies (Accounts) Rules, 2014, the Annual Report containing salient features of the financial statements, including consolidated financial statements, for the financial year 2022-23, along with statement containing salient features of the Directors Report (Management Discussion & Analysis and Corporate Governance Report) is being sent only by electronic mode to members whose e-mail addresses are registered with the Company or with the Depository participant and uploaded on the website of the Company and also be accessed from the websites of the Stock Exchanges i.e. BSE Ltd and National Stock Exchange of India Limited at www.bseindia.com and www.nseindia.com respectively.
Annual Report 2022-23 contains complete Balance Sheet, Statement of Profit & Loss, other statements and notes thereto, including consolidated financial statements, prepared as per the requirements of Schedule III to the Companies Act, 2013.
DIVIDEND
The Board of Directors of your company pleased to recommend a Final Dividend of 10% i.e. Rs. 1/- Equity Share having face value of Rs. 10/- aggregating to Rs. 19114955/- for the Financial Year ended on 31st March 2023. The proposed Dividend, subject to approval of Shareholders in the ensuing 16th Annual General Meeting of the Company, will be paid to shareholders within the period stipulated by the applicable Companies Act, 2013. The dividend would be payable to all Shareholders whose names appear in the Register of Members as on the Book Closure Date. The Register of Members and Share Transfer Books shall remain closed from 23rd September 2023, Saturday to 29th September, 2023, Friday (both days inclusive).
AMOUNT TRANSFERRED TO INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to applicable provisions of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (Rules) as amended, all unpaid or unclaimed dividends are required to be transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government, after completion of seven years from the date of transfer to Unpaid Dividend Account of the Company. Hence, during the
Financial Year 2022-23 unpaid/unclaimed dividends of Rs. 81,739.50 relating to Interim Dividend for FY ended 2015-16 were transferred to the Investor Education and Protection Fund.
DETAILS OF NODAL OFFICER
Nodal The Company has appointed Mr. Narain Das Gurnani, Whole Time Director cum CFO Officer and Mrs. Varsha Ranee Choudhary, Company Secretary Cum Compliance Officer as the Deputy Nodal Officer for the purpose of coordination with Investor Education and Protection Fund Authority.
RESERVES
Your Directors do not propose to transfer any amount to the general reserve and entire amount of Profit for the year forms part of the ‘Retained Earnings i.e. Rs. 2284.79 lakhs.
SHARE CAPITAL STRUCTURE
The Authorised Capital of the company is Rs. 25,00,00,000/- (Rupees Twenty Five Crores Only) divided into 2,50,00,000 (Two Crore Fifty Lakhs) equity shares of Rs. 10/- each and Issued, Subscribed and Paid-up capital is Rs. 19,11,49,550/- (Rupees Nineteen Crore Eleven Lacs Forty Nine Thousand Five Hundred Fifty Only) divided into 1,91,14,955 (One Crore Ninety One Lacs Fourteen Thousand Nine Hundred Fifty Five) equity shares of Rs. 10/- each during the year.
There has been no change in the Authorized Share Capital, Issued, Paid up and Subscribed Capital of the company during the year.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There is no change in the nature of business of the Company during the financial year ended 31st March, 2023.
MATERIAL CHANGES & COMMITMENTS, IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY
No material changes and commitments affecting the financial position of the Company occurred between the end of the inancial year of the Company to which financial year relates and the date of this Report.
With the help of our previous acquisition of Vankon Modular Private Limited, we enhanced our market share in various states such as Rajasthan, Uttar Pradesh, Assam and West Bengal. This not only helped us in capturing the market share but also added on to our dealers and their ef icacy.
PARTICULARS OF LOAN, GUARANTEE AND INVESTMENTS
The details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013, as at 31st March, 2023, are given in the Note No. 4 & Note No. 5 of the Standalone Financial Statements of the Company. These loans and investments were made for the purpose of optimum returns.
DEPOSITS
During the year under review, the Company has neither accepted nor renewed any deposits in terms of Chapter V of the Companies Act, 2013 and Rules framed thereunder.
The Company has not received any unsecured loan from its directors during the financial year 2022-23.
BUSINESS OPERATIONS / STATE OF COMPANYS AFFAIRS
VETO showed robustness in their financial results and achieved desired growth as planned, even with drastic changes in commodity prices it managed to attain optimum utilization of resources. With Effective management it concurred all market challenges and achieved customer satisfaction.
YourCompany continued with wide range of new product launches and innovations to ful il needs and demands of customers, keeping it all budget friendly with high security of products. Intending to enhance mechanism behind material usage and its production. Along with that it is also planning to re-engineer some of its creations to make it more customer adaptable and also improving product molding as well as bonding process.
It is trying its level best to cut down redundant costs and it is focused on mechanism working such as silver layer re- working and Bimetallic silver bonding, which in a way help in attaining cost ef iciency as well as it will result into fruitful usage of resources.
The Company and individuals carry the same objective of not only improving, but empowering peoples lives with our unique repertoire of products and services, backed by time tested technology and advanced Research & Development methods. With persistent focus on innovation, prompt capitalization of opportunities, building up credibility through strategic thinking, operational expertise, well planned investments and business integrity, we aim to continue our journey without any reduction in intensity or strength. The company envisages an organization that is truly global in every way i.e. technology, policies and possibilities and it can be seen with its world-wide tie-ups, collaborations and import-export relations. Your company has been developing as a distinctive brand of leadership well equipped to address critical challenges faced by industry and society. Our ambition is being recognized as one of the major competitors globally in the electrical accessories industry.
Veto Switchgears and Cables Limited is one of the most respectable cable manufacturers in India. Brand Veto is committed to quality, safety and service with no compromise.
The Company is an ISO 9001:2008 certi ied company, engaged in manufacturing and selling wires & cables along with other electrical accessories in India.
The brand VETO came into existence in 1967 and since then holds a major sector of electrical accessories in India. The company has built powerful and efficient team of marketing professionals, dealers and distributors. Result of which can be seen through its increasing sales. Production has reached its manifold several times since its inception. We aim at providing " Best Quality at Competitive Prices".
The product portfolio ranges from industrial cables, Multi stand cables, from General Switches to Modular Switches, Ceiling Fans, LED Bulbs and other Electrical Accessories such as Switch Socket, MCB, Bell and all other Electrical Accessories that are used for Household purposes and manufacturing of Wires and Cables. Cable range starts from 0.75 mm to 10 mm. The Company also manufactures LED Panel Lights, LED Flood Light, LED Street Light, Rope Lights, Slim Panel Light, LED Strip Light and has also received tremendous response from selling the same.
The products are supplied under the brand name "VETO" and "VIMAL POWER " through large network of dealers and distributors to its valuable customers in India as well as in Abroad.
VIMAL POWER is a part of Veto group and continues to reinforce a successful international presence and enhance its enviable reputation for innovation. Measures taken for continuous research and development ensures in developing world beating range of cables for satisfying or surpassing the requirements of Indian Standards.
Its major distribution in India covers more than 20 states including major sale in Rajasthan, Uttar Pradesh, Gujarat, Haryana, Himachal Pradesh, Punjab, J&K, Uttarakhand, Assam, Karnataka, Kerala, Tamil Nadu, Andhra Pradesh, Madhya Pradesh, Telangana, Maharashtra, Mizoram, Meghalaya, Tripura, Manipur, Arunachal Pradesh and Nagaland.
Developing its distribution with time and maintaining a good position in the market, it is trying level best to reach every possible destination in India and is willing to provide such services at economical rates. Throughout its distribution levels across India it has attained hike in sales, the data of the same is presented below:
For detailed analysis of the performance, including industry overview, changes, segment details refer to the Managements Discussion and Analysis Report provided under regulation 34(2) (e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 presented separately and forms part of this board report.
Raw Material
Our Companys present and proposed consumption of Raw material is as under :
(Qty. in Kg)
| Product category | Existing (2022-23) | Proposed (2023-24) |
| Copper | 5560 | 5671.2 |
| PVC Resin | 4720 | 4814.4 |
| Aluminium | 310 | 316.2 |
Infrastructure Facilities
O Power: Presently 400 KVA of power supply is sanctioned by Uttarakhand Power Corporation Limited of which approximately 325 KVA have been utilized for our present business operations. Addition to this, the Company has installed a DG set of 250 KVA capacity to avoid any disruption in the power supply. Therefore, we envisage that our further requirement of power for our proposed modernization plans can easily be met from the present supplies. O Fuel: Our Company mainly requires HSD for operating the DG sets. The present monthly consumption of HSD is about 1000 litres. The HSD is being supplied by retail outlets of IOC, HPCL and BPCL.
O Water: Water is an essential need and is basically required for drinking and other domestic purpose. Presently, about 7000 litres per day (after proposed modernization) is required at our Haridwar unit. Requirement of water is met from our own borewell. The water supply is regular and suf icient to meet entire requirements. There is no dif iculty in obtaining water because of the presence of number of borewell and the water level in the area being high due to proximity to nearby canal and River Ganga.
O Manpower: Our Company has adequate manpower at all levels and does not envisage any dif iculty in getting the requisite personnel for our business operations at existing locations. Details of manpower are as follow:
| Category | Nos. |
| Top management | 3 |
| Managerial & Supervisory sta | 10 |
| Office sta | 148 |
| Skilled workers | 43 |
| Unskilled workers | 127 |
| Total | 331 |
O Effluent Treatment and Disposal : Our Company does not generate any industrial effluents which is hazardous to the environment. The waste produced during the manufacturing operation is re-used and/ or recycled.
O Environmental Clearance: We have got all the necessary approvals from the local authorities to operate our business.
O Safety Standards: Quality and safety are the hallmarks of our diverse range of products, which are designed and manufactured to the very highest standards such as ISO 9001 and approved by the leading organizations nationally and internationally.
O Our Strategy: Companys goal is to enhance the competitiveness in the market by adopting several techniques such as continuous research and development, product engineering to ensure the best manufacturing process for our products. Research and development in electrical accessories and other allied products will better enable a competitive position in the market. Further enhancement of operations by improving the existing assets to yield better output. Installation of new assets to enhance and attract new markets is also in the horizon.
O Capacity and capacity utilization
| Particulars | Projected | Actual | |
| Wires & Cables | FY 2022-23 | FY 2023-24 | FY 2022-23 |
| Installed Capacity | 20.00 Lacs Bundles | 20.00 Lacs Bundles | 20.00 Lacs Bundles |
| Capacity Utilization (in %) | 47.9% | 48.00% | 26.60% |
| Production | 9.58 Lac Bundles | 9.60 Lac Bundles | 5.32 Lac Bundles |
| Electrical Accessories | |||
| Installed Capacity | 600 Lac pieces | 600 Lac pieces | 600 Lac pieces |
| Capacity Utilization (in %) | 40% | 40% | 19.71% |
| Production | 240 Lac pieces | 240 Lac pieces | 118.25 Lac pieces |
NOTE: There is a slight fluctuation in projected targets and actual results due to in lationary range of copper.
Insurance
Our Company has taken up a range of insurance policies including:
1 . Fire policies for our units, buildings and of ices, raw materials, work-in-progress and finished goods as well as entire stock maintained at all our Depots;
2 . Marine policy for transit of raw materials and finished products in India and Marine Export policy;
3 . Accidental & Health insurance facility for ield sta ;
4 . Gratuity policy.
These insurance policies are reviewed annually to ensure that the coverage is adequate. All the policies are in existence and the premiums have been paid thereon.
O Internal Control System
The Company has an adequate system of internal control commensurate with its size and nature of business. These systems provide a reasonable assurance in respect of providing financial and operational information, complying with applicable statutes, safeguarding of assets of the Company and ensuring compliance with corporate policies. The Audit Committee reviews adherence to internal control systems and internal audit reports periodically.
Preparation and issuance of financial reports to the shareholders and in the market, including the Annual Report and consolidated financial statements, is reviewed by the Audit Committee. The Companys financial reporting process is controlled using documented accounting policies and reporting formats, supplemented by detailed instructions and guidance on reporting requirements. The Companys processes support the integrity and quality of data, including appropriate segregation of duties. The financial information of the parent entity and all its subsidiary entities which form the basis for the preparation of the consolidated financial statements are subject to scrutiny by Group level senior management. The Companys financial reports, financial guidance, Annual Report and consolidated financial statements are also reviewed by the Audit Committee of the Board prior of presenting to the Board of Directors for their consideration and approval.
Detailed budgetary process includes identi ication of risks & opportunities which is ultimately approved at Board level.
Board approved the capital expenditure and Audit Committee approved the treasury policies which clearly defines authorization limits and procedures.
An internal audit function reviews key financial / business processes and has full & unrestricted access to the Audit Committee.
A risk management programme is placed throughout the Company whereby Risk Management executive reviews and monitors the controls in place both financial and non-financial, to manage the risks facing the business.
SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES
As on 31st March 2023, The Company had 4 (Four) Subsidiary Companies. One of the mentioned entity is registered outside India and three are registered in India:
| S. No Name of the Entity | Relationship |
| 1. Veto Electricals Private Limited | Wholly own Subsidiary |
| 2. Veto LED Lighting Private Limited | Wholly own Subsidiary |
| 3. Veto Overseas Private F.Z.E. | Wholly own Subsidiary |
| 4. Vankon Modular Private Limited | Subsidiary |
The details with respect to Subsidiary Companies are provided in the Annexure-I to the Directors Report of the Company.
A separate statement containing the salient features of financial statements of all the subsidiaries of your Company forms part of Annual Report in the prescribed Form AOC-1 as Annexure II in of the Companies Act, 2013 and the rules made there under. There has compliance with Section 129(3) been no material change in the nature of the business of the subsidiary company.
In accordance with third proviso to Section 136(1) of the Companies Act, 2013, the Annual Report of your Company, containing inter alia the audited standalone and consolidated financial statements, has been placed on the website of the Company at https://www.vetoswitchgears.com. Further, audited financial statements together with related information of each of the subsidiary companies have also been placed on the website of the Company at https://www.vetoswitchgears.com .
In terms of Section 136 of the Companies Act, 2013 (‘the Act), financial statements of the subsidiary companies are not required to be sent to the members of the Company. The Company shall provide a copy of the annual accounts of its subsidiary companies to the members of the Company on their request. The annual accounts of its subsidiary companies will also be kept open for inspection at the registered of_ice of the Company during business hours.
Pursuant to the requirements of Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, the details of Loans/ Advances made to and investments made in the subsidiary have been furnished in Notes forming part of the Accounts.
Material Subsidiary:
Vankon Modular Private Limited is a material subsidiary of the Company as per the thresholds laid down under the Listing Regulations. The Board of Directors of the Company has approved a Policy for determining material subsidiaries which is in line with the Listing Regulations as amended from time to time. The Policy has been uploaded on the Companys website at https://www.vetoswitchgears.com.
Further, the Company does not have any joint venture or associate companies during the year or at any time after the closure of the year and till the date of this report.
DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND PARTICULARS OF EMPLOYEES
As Information has been laid down under Section 197 (12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
1. Ratio of the remuneration of each Director to the median remuneration of the employee of the Company for the Financial Year: -
| S.NO. NAME OF DIRECTOR | TITLE | RATIO TO MEDIAN REMUNERATION |
| 1. Mr. Akshay Kumar Gurnani | Managing Director / CEO | 12.26 |
| 2. Mr. Narain Das Gurnani | Whole Time Director / CFO | 4.08 |
| 3. Ms. Jyoti Gurnani | Woman Director | 2.04 |
2. Percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the Financial Year
| S.NO. NAME OF PERSON | DESIGNATION |
%INCREASE IN REMUNERATION |
| 1. Mr. Akshay Kumar Gurnani | MD & CEO | 50% |
| 2. Mr. Narain Das Gurnani | WTD & CFO | Not Increased |
| 3. Mr. Jyoti Gurnani | Woman Director | Not Increased |
| 4. Mrs. Varsha Choudhary | CS | 12% |
3. Percentage increase in the median remuneration of employees in the Financial Year:
The median remuneration of employees of the company has been increased to 293543.05 by 2.19% resulting with increase in salary of CEO.
4. Number of permanent employees on the rolls of the Company
There are total 331 employees in the Company.
5. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justi ication thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.
The average increase in the salaries of all employees for FY 2022-23 was 10.36%. The average increase in remuneration of managerial personnel was 0.16%. The criteria for remuneration evaluation for all employees is based on an appraisal process which is conducted on annual basis and the remuneration of managerial personnel is based as per Nomination & Remuneration policy. The increase in remuneration also dependents on the overall performance of the company, market benchmarks. The company reiterates that there were no exceptional circumstances which warranted an increase in managerial remuneration which was not justifiied by the overall performance of the company.
6. Affirmation:
The remuneration is as per the Nomination Remuneration and Evaluation Policy for the Directors, Key Managerial Personnel and Other Employees of the Company, formulated pursuant to the provisions of Section 178 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
None of the employee of the company is drawing more than Rs. 102 Lakhs per annum or Rs. 8.50 Lakhs per month for the part of the year, during the year under review. Therefore, particulars of the employees as required under Section 197 of Companies Act, 2013 read with rule 5(2) & rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable during the year under review.
Details of top Ten employees in terms of the remuneration and employees in receipt of remuneration as prescribed under rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, containing details prescribed under rule 5(3) of the said rules, will be made available to any member on request, as per provisions of Section 136(1) of the Act.
Pursuant to Section 197(14) of the Companies Act, 2013 neither the Managing Director nor Whole Time Director of the Company received any remuneration or commission from any of its subsidiaries.
CORPORATE GOVERNANCE REPORT
Your Company has complied with the Corporate Governance requirements under Companies Act, 2013 and as stipulated under the provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A detailed Report on Corporate Governance in this Annual Annexure III part of Report.
CORPORATE GOVERNANCE CERTIFICATE
The Company is continuously submitting "Quarterly Compliance Report on Corporate Governance" as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the Stock Exchanges.
The certificate from the Practicing Company secretary, Mr. Govind Jaiswal, C.P. No.19954, con irming compliance of requirements of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 has been included in Annexures VIII of this report .
DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
The composition of the Board of Directors of the Company is in accordance with the provisions of Section 149 of the Act and Regulation 17 of the Listing Regulations, with an appropriate combination of Executive, Non-Executive and Independent Directors.
In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Companys Articles of Association, Mr. Narain Das Gurnani, Whole Time Director, (DIN: 01970599) retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for reappointment. The Board recommends their reappointment. However, his term is _ixed and shall not break due to this retirement. Your Directors have recommended his appointment for approval of the shareholders, in the ensuing Annual General Meeting of your Company.
The Board of Directors, on recommendations of the Nomination and Remuneration Committee have proposed re-appointment Dr. Kanwarjeet Singh (DIN: 07813714) as Independent Director of the Company for a second term of 5 (five) consecutive years, as it was approved by the Members of the Company in the 15th Annual General Meeting.
Further, the Board praises the contribution given by Mr. Govind Ram Thawani (DIN: 06367093) for his tenure, as he concludes his second term of 5 (five) years and retires from the position of Independent Director in the 15th Annual General Meeting.
Furthermore, in the year 2022-23 Mr. Sanjeev Kumar Dass (DIN: 09690317) was appointed as Independent Director for the first term of 5 (five) consecutive years, as it was approved by the members in the 15th Annual General Meeting.
The following have been Directors and Key Managerial Personnel during the year.
| S. No. Name of the Directors / KMP | Designation | Date of Appointment |
| 1. Mr. Akshay Kumar Gurnani | Executive Managing Director and CEO | 27/08/2014 |
| 2. Mr. Narain Das Gurnani | Whole-Time Director and CFO | 24/05/2016 |
| 3. Mrs. Jyoti Gurnani | Woman Director Non-Executive | 27/08/2014 |
| 4. Mr. Sanjeev Kumar Dass | Independent Director | 01/09/2022 |
| 5. Mr. Kanwarjeet Singh | Non-Executive Independent Director | 06/05/ 2017 |
| 6. Mr. Hari Krishan Motwani | Non-Executive Independent Director | 28/09/2019 |
| 7. Mrs. Varsha Ranee Choudhary | Company Secretary cum Compliance Officer | 29/06/2020 |
Disquali ications of Directors
During the year declarations were received from the Directors of the Company pursuant to Section 164 of the Companies Act, 2013. Board appraised the same and found that none of the director is disqualifiied for holding office as director.
NUMBER OF MEETINGS OF THE BOARD, ITS COMMITTEES & AGM:
In total, Eight (8) Board Meetings were held during the year 2022-2023 and the gap between two consecutive meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Following is the schedule of Board Meetings:
Detail of Board Meetings held
| S. No. Date of Board Meeting |
| 1. 25th April, 2022 |
| 2. 26th May, 2022 |
| 3. 10th August, 2022 |
| 4. 01st September, 2022 |
| 5. 27th September, 2022 |
| 6. 01st October, 2022 |
| 7. 14th November, 2022 |
| 8. 14th February, 2023 |
Separate Meeting of Independent Directors:
Pursuant to the requirements of Schedule IV to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Separate Meeting of the Independent Directors of the Company was also held on 14th February, 2023 . The Meeting was conducted in an informal manner without the attendance of non-independent Directors and members of management.
The meeting shall:
(a) review the performance of non-independent Directors and the Board as a whole;
(b) review the performance of the Chairperson of the company, taking into account the views of executive Directors and non-executive Directors;
(c) Assess the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
Information on the Audit Committee, the Nomination and Remuneration Committee, the Stakeholders Relationship Committee and the Corporate Social Responsibility Committee and Committees held during the year is given in the Corporate Governance Report . meetings of these
Further, Annual General Meeting of the Company for the financial year 2021-22 was held on 28th September, 2022
FORMAL ANNUAL EVALUATION
The Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI LODR") contain provisions for the evaluation of the performance of: (i) The Board as a whole, (ii) The individual directors (including independent directors and Chairperson) and (iii) Various Committees of the Board.
The performance of the board was evaluated by the board after seeking inputs from all the directors on the basis of the criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.
The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The board and the Nomination and Remuneration Committee reviewed the performance of the Individual Directors on the basis of the criteria such as the contribution of the Individual Director to the Board and Committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role. The Directors were satis ied with the evaluation results, which re lected the overall engagement of the Individual Directors, the Board as a whole and its Committees with the Company.
The performance evaluation criteria for Independent Directors are determined by the Nomination and Remuneration Committee. An indicative list of factors that may be evaluated include participation and contribution by a Director, commitment, effective deployment of knowledge and expertise, effective management of relationship with stakeholders, integrity and maintenance of con identiality and independence of behavior and judgments.
All the Relevant details have been provided in the Corporate Governance Report.
REMUNERATION POLICY
In accordance with Section 178 and other applicable provisions if any, of the Companies Act, 2013 read with the Rules issued there under and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors formulated the Nomination and Remuneration Policy of your Company on the recommendations of the Nomination and Remuneration Committee. Pursuant to Section 134(3) of the Companies Act, 2013, the nomination and remuneration policy of the Company which lays down the criteria for determining quali ications, positive attributes and independence for appointment of Directors and policies of the Company relating to remuneration of Directors, KMP and other employees is available on the Companys website at https://vetoswitchgears.com .
DECLARATION BY AN INDEPENDENT DIRECTOR(S) AND RE-APPOINTMENT, IF ANY
The Independent Directors have submitted the declaration of independence, as required under Section Act, 2013, stating that they meet the criteria of independence as provided in 149(7) of the Companies Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘the Listing Regulations) as amended from time to time. The terms & conditions for the appointment of Independent Directors of the Company have been separately disclosed in the Corporate Governance Report.
In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualifiication of Directors) Rules, 2014, Independent Directors of the Company have con irmed that they have registered themselves with the databank maintained by The Indian Institute of Corporate A airs, Manesar ("IICA"). The Independent Directors are also required to undertake online pro iciency self-assessment test conducted by the IICA within a period of 2 (two) years from the date of inclusion of their names in the data bank, unless they meet the criteria speci ied for exemption.
Dr. Kanwar Jeet Singh, Independent Director of the Company is exempt from the requirement to undertake online proficiency self-assessment test.
Mr. Hari Krishan Motwani and Mr. Sanjeev Kumar Dass, Independent Directors of the Company had been cleared online proficiency self-assessment test.
Statement with regard to integrity, expertise and experience of the independent director appointed during the year.
During the year under review, the Board has appointed/ re-appointed Independent Director in the Company. However, in the opinion of the Board, all our Independent Directors possess requisite qualifications, experience, expertise and hold high standards of integrity for the purpose of Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014. List of key skills, expertise and core competencies of the Board, including the Independent Directors, is provided in Corporate Governance Report.
COMMITTEES OF BOARD
The Company has various committees which have been constituted as a part of the good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes. Following are the four Committees of the Board namely: a) Audit Committee b) Nomination and Remuneration & Compensation Committee
c) Corporate Social Responsibility (CSR) Committee d) Stakeholders Relationship Committee
Detail of all the Committees along with their composition, charters duties, responsibilities, activities and meetings held during the year, have been provided in the "Report on Corporate Governance" as part of this Annual Report.
| Name of Committee | Composition of Committee |
| Audit Committee | 1. Mr. Sanjeev Kumar Dass - Chairman |
| 2. Mr. Hari Krishan Motwani | |
| 3. Mr. Narain Das Gurnani | |
| Nomination and Remuneration Committee | 1. Mr. Sanjeev Kumar Dass - Chairman |
| 2. Dr. Kanwarjeet Singh | |
| 3. Mr. Hari Krishan Motwani | |
| Shareholders/Investors Grievance Committee | 1. Mr. Sanjeev Kumar Dass - Chairman |
| 2. Mr. Narain Das Gurnani | |
| 3. Mr. Hari Krishan Motwani | |
| Corporate Social Responsibility Committee | 1.Mr. Sanjeev Kumar Dass - Chairman |
| 2. Mr. Hari Krishan Motwani | |
| 3. Mr. Narain Das Gurnani |
Note: Changes in the composition of Director and the Committee: Mr. Govind Ram Thawani retired in 15th AGM due to his completion of Second tenure and Mr. Sanjeev Kumar Dass was appointed as an additional Non Executive Independent Director and his appointment for the _irst term con irmed in the 15th AGM.
The Committee comprises of majority of Independent Directors.
During the year under review, all the recommendations made by the Audit Committee were accepted by the Board.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The constitution, composition, terms of reference, role, powers, rights, obligations of ‘Corporate Social Responsibility Committee [‘CSR Committee] are in conformity with the provisions of Section 135 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014. Relevant details have been provided in the Corporate Governance Report.
During the year under review, the Company has spent Rs.30.69 lacs on Corporate Social Responsibility as per the CSR policy of the Company. Which is more than 2% of average net Profit of last three immediately preceeding financial years. Detailed information report on the CSR initiatives taken during financial year 2022-23 is given in ANNEXURE-IV.
The Company has focused on social cause, Health, Education and other Humanitarian Causes implementation of its Corporate Social Responsibility as per Schedule VII of the Companies Act, 2013. The CSR Policy is available on the Companys website which is accessible through weblink. https://vetoswitchgears.com
ENVIRONMENT, HEALTH AND SAFETY
VETO is committed towards caring for people and the planet by integrating environmental and safety principles in all the aspects of its business from procurement to material usage, from manufacturing of sustainable products to creating awareness through marketing or through innovation / R&D for better products and processes. We constantly monitor and innovate our environmental and occupational health and safety performance through our internal risk management mechanism. At the compliance level, your Company con irms to all applicable regulatory Environmental Health & Safety (EHS) requirements wherever it operates.
Our Company is sensitive towards environmental and resource conservation and its manufacturing philosophies which ensure safety of the workers and surroundings. Being in a non-polluting category of business, it causes minimal impact on the environment but has a huge positive impact on the local community. Restrictions of Hazardous Substances (RoHS) compliance in all its products like CFLs, cables, PCBs, etc. ensures safety across the product life cycle. Our Company strongly believes and promotes energy conservation not only through its products but also within the premises. Energy conservation measures have been adopted at all the plants.
Our Company follows best practices for health and safety. Employees and workers are regularly trained by industry experts on issues of occupational and industrial health & safety, _irst-aid and environment management. Healthy lifestyle and well-being are also promoted as a culture at VETO. Our Company also provides life insurance cover, personal accident cover and robust medical & health policies to all _ield sta against any unfortunate incident. VETO strongly believes in maintaining a balanced work-life and therefore follows strict in-and-out work-timings. This has gone a long way in maintaining a healthy, happy and motivated workforce.
Our approach at workplaces was strategically formulated and implemented, considering the nature of working site, employee strength, floor density and other relevant attributes
RISK MANAGEMENT
The Company has framed and implemented Risk Management Policy to identify the various business risks. This framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Companys competitive advantage. The risk management policy defines the risk management approach across the enterprise at various levels including documentation and reporting.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3) (c) of the Companies Act, 2013, the Directors to the best of their knowledge hereby state and confirms that:
(a) in the preparation of the annual accounts for the financial year ended 31st March 2023, the applicable accounting standards have been followed along with proper exp l anation relating to material departures;
(b) the Directors had selected such accounting policies, being applied them consistently and make judgments & estimates that are reasonable and prudent so as to give a true and fair view of the state of a airs of the Company as at 31st March 2023 and Profit of the Company for that period;
(c) the Directors had taken proper and suf icient care for the maintenance of adequate accounting records 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;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down proper internal financial controls have been laid down which are adequate and are operating effectively; and
(f) the Directors had devised Proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively .
RELATED PARTY TRANSACTIONS
In line with the requirements of the Companies Act, 2013 and the SEBI Listing Regulations, the Company has formulated a Policy on Related Party Transactions. During the year under review, the Policy has been amended to incorporate the regulatory amendments in the SEBI Listing Regulations. The updated Policy can be accessed on the Companys website at www.vetoswitchgears.com
All transactions entered with Related Parties for the year under review were on arms length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder are not attracted. Thus, disclosure in form AOC-2 in terms of Section 134 of the Companies Act, 2013 is not required.
The Company has put in place a mechanism for certifying the Related Party Transactions, A Statements placed before the Audit Committee and the Board of Directors from an Independent Chartered Accountant.
All Related Party Transactions are placed before the Audit Committee and also to the Board for approval. Omnibus approval was obtained on yearly basis for transactions which are of repetitive nature. Transactions entered into pursuant to omnibus approval are audited and a statement giving details of all Related Party Transactions are placed before the Audit Committee and the Board for review and approval.
However, Details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in the notes to the standalone/ consolidated financial statements forming part of this Report & Annual Accounts 2022-23.
ANNUAL RETURN
A copy of the Extracts of the Annual Return of the Company as required under section 134(3)(a) of the Companies Act, 2013, in Form MGT-9, as they stood on the close of the financial year i.e. 31st March, 2023 is furnished in Annexure V and forms part of this Report.
Further, a copy of the Annual Return of the Company containing the particulars prescribed u/s 92 of the Companies Act, 2013, in Form MGT-7, as they stood on the close of the financial year i.e. 31st March, 2022 is uploaded on Companys website: https://vetoswitchgears.com .
AUDITORS
STATUTORY AUDITORS
The Board of Directors, as recommended by the Audit Committee and being subjected to shareholders approval re-appointed CAS & Co formerly known as M/s. K. M. Tulsian & Associates (Firm Registration No. 111075W) for a second term of 5 (five) consecutive years at the 15th Annual General Meeting held on 28th September, 2022.
OBSERVATION
The observations of Statutory Auditor in its reports on standalone and consolidated financials are self- explanatory and do not contain any qualification, reservation or adverse remark or disclaimer.
DETAILS
There was no fraud in the Company, which was required to report by Statutory Auditors of the Company under sub-section (12) of Section 143 of Companies Act, 2013.
COST AUDITORS
As per Section 148 of the Companies Act, 2013, the Company is required to have the audit of its cost records conducted by a Cost Accountant in practice.
M/s. Rajesh & Company, Cost Accountants (Firm Registration Number No. 000031) were appointed as the Cost Auditor of the Company for the year ending 31st March, 2023. The due date for filing the Cost Audit Report of the Company for the financial year ended 31st March, 2022 was filed in XBRL made by the Cost Auditor within due date.
Based on the recommendation of Audit Committee, the Board of Directors re-appointed M/s. Rajesh & Company, Cost Accountants (Firm Registration Number No. 000031) as Cost Auditor to audit the cost accounts of the Company for the Financial Year 2023-24, Cost Auditors have con irmed that their appointment is within the limits of Section 141(3)(g) of the Companies Act, 2013 and have also certi ied that they are free from any disquali ications speci ied under Section 141(3) and proviso to Section 148(3) read with Section 141(4) of the Companies Act, 2013.
As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditors are required to be placed before the members in a General Meeting for their ratification. Accordingly, a resolution seeking members ratification for the remuneration payable to M/s. Rajesh & Company; Cost Auditors forms part of the AGM Notice.
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board appointed Mr. Govind Jaiswal & Co., Practicing Company Secretary, Jaipur to conduct Secretarial Audit for the Financial Year 2022-23.
The Secretarial Audit Report (MR-3) for the Financial Year ended 31st March 2023 is annexed herewith marked as Annexure VI to this Report. The Secretarial Audit Report does not contain any quali ication, reservation or adverse remark.
Further, pursuant to the provisions of Section 204 of the Act, the Board of Directors on the recommendation of the Audit Committee had appointed Mr. Govind Jaiswal & Co., Practicing Company Secretary, Jaipur, as Secretarial Auditors of the Company for issuing the Secretarial Audit Report for the financial year 2023-24.
SECRETARIAL AUDIT OF MATERIAL UNLISTED SUBSIDIARY COMPANY
Vankon Modular Private Limited, a material subsidiary of the Company undertakes Secretarial Audit under Section 204of the Companies Act, 2013. The Secretarial Audit of Vankon Modular Private Limited for the Financial Year 2022-23 was carried out pursuant to Section 204 of the Companies Act, 2013 read with Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Secretarial Audit Report of Vankon Modular Private Limited submitted by Mr. Govind Jaiswal & Co., Practicing Company Secretary, Jaipur, does not contain any quali ication, reservation or adverse remark or disclaimer. The Secretarial Audit Report given by the Secretarial Auditor of the Company is annexed as Annexure VII and forms an integral part of this Report.
ANNUAL SECRETARIAL COMPLIANCE REPORT
The Company has undertaken an audit for the financial year 2022-23 for all applicable compliances as per SEBI Regulations and Circulars/ Guidelines issued there under. Pursuant to provision of Regulation 24A, the Annual Secretarial Compliance Report was obtained from Mr. Govind Jaiswal & Co., Practicing Company Secretary, Jaipur, Secretarial Auditors and submitted to the stock exchanges within 60 days of the end of the inancial year.
INTERNAL AUDITORS
Pursuant to the provisions of the Companies Act, 2013 read with corresponding Rules framed thereunder. The Board of Directors has appointed Mr. Kunal Sanghi, Chartered Accountant as Internal Auditor in place of Mr. Amit Tiwari w.e.f. 01st Sept, 2022 to conduct the internal audit of the various areas of operations and records of the Company. The periodic reports of the said internal auditors are regularly placed before the Audit Committee along with the comments of the management on the action taken to correct any observed deficiencies on the working of the various departments.
The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations including those relating to strengthening of the Companys risk management policies and systems.
CODE OF CONDUCT
The Board has put in place a Code of Conduct for Directors and Senior Management of the Company in line with the provisions of the Act and the Listing Regulations. The Code is available on the website of the Company.
All Board members and senior management personnel have con_irmed compliance with the Code has been included in Annexures X of this report. Declaration on adherence to the code of conduct is forming part of the Corporate Governance Report.
MD/CFO CERTIFICATION
In terms of requirement of Regulation 17(8) read with Part B of Schedule II of Listing Regulations, Mr. Akshay Kumar Gurnani, Managing Director cum Chief Executive Officer and Mr. Narain Das Gurnani, Whole Time Director cum Chief Financial Officer of the Company have furnished certifiicate to the Board in the prescribed format certifying that the financial statements do not contain any materially untrue statement and these statements represent a true and fair view of the Companys affairs. The said certifiicate is annexed in Annexures XI of this Report. The said certificate had been reviewed by the Audit Committee and the same was taken on record by the Board at the Meeting held on 30th May 2023.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE
There were no signifiicant material orders passed by the Regulators/Courts/Tribunals which would impact the going concern status of the Company and its future operations.
DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
Your Companys internal control system is commensurate with its scale of operations designed to effectively control the operations. The internal control systems are designed to ensure that the financial and other records are reliable for the preparation of financial statements. Independent Internal Auditor conduct audit covering a wide range of operational matters and ensure compliance with speci ied standards. Planned periodic reviews are carried out by Internal Auditor. The findings of Internal Audit are reviewed by the top management and by the Audit Committee of the Board of Directors. The Audit Committee reviews the adequacy and effectiveness of internal control systems and suggests ways of further strengthening them, from time to time. Report of statutory auditors for internal financial control system is part of Audit Report.
The Company has robust internal financial controls systems, which is in line with requirement of the Companies Act, 2013, which is intended to increase transparency & accountability in an organizations process of designing and implementing a system of internal control. This provides the Directors with reasonable assurance regarding the adequacy and operating effectiveness of controls with regards to reporting, operational and compliance risks. The Company has devised appropriate systems and framework including proper delegation of authority, policies and procedures, effective IT systems aligned to business requirements, risk based internal audits and, risk management framework.
REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT
In accordance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 ("POSH Act") and Rules made thereunder, the Company has in place a policy which mandates no tolerance against any conduct amounting to sexual harassment of women at workplace and ensures that workplaces remain free from sexual harassment and provides a safe and secure environment for women.
As a good corporate citizen, Veto is committed to a gender friendly workplace. It seeks to enhance equal opportunities for men and women, prevents/stops/redresses sexual harassment at the workplace and institute good employment practices. Veto has established suitable processes and mechanisms to ensure and address issues on sexual harassment, if any, maintaining an open door for repartees. Veto encourages employees to report any harassment concern and is responsive to complaints about harassment or any other unwelcome and o ensive conduct. An Internal Complaint Committee has been constituted to enquire into the complaints and recommend appropriate action, wherever required. Veto demands, demonstrates and promotes professional behavior and respectful treatment of all employees.
The summary of complaints received and disposed-o during the Financial Year 2022-23 were as under: Number of complaints received: NIL
Number of complaints disposed o : Not Applicable
CREDIT RATING
Your Company has been ascribed long-term rating of BBB+ (ICRA triple B plus) for the tenure of long term facilities, which includes facilities of more than a year. Along with that your company has been allotted Short-term rating ICRA A2 (A Two) by ICRA Limited for the tenure of short term facilities, which includes facilities relating and limited to a year. Further the outlook of long term rating is "Stable".
COMPLIANCE WITH SECRETARIAL STANDARDS
The Company is in compliance with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Act.
DEPOSITORY SYSTEM
Our Companys Equity Shares are in dematerialized form through The National Securities Depository Limited (NSDL) and The Central Depository Services (India) Limited (CDSL). The Company has already set the requisite facilities for dematerialization of its Equity Shares in accordance with the provisions of Depository Act, 1996 with National Securities Depository Limited and Central Depository Services (India) Limited. The Company had entered into agreements with both the Depositories. Accordingly, Post IPO, shares of the Company are held in demat form.
LISTING OF SHARES
The shares of the Company are listed on recognized Stock Exchanges i.e. at BSE Limited & at National Stock Exchange of India Limited and the listing fee for the year 2022-23 has been duly paid.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORBTION AND FOREIGN EARNINGS & OUTGO
Particulars in consonance with conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the companies (Accounts) Rules, 2014:
(A)CONSERVATION OF ENERGY
The Company contributes to environmental protection by abiding sustainable business practices, it supports optimum utilisation of resources resulting to overall environmental and sustainable growth. friendly environment via optimum consumption of natural resources and The Company supports eco- restricts itself from over utilising and exploitation of the same.
(i) The steps taken or impact on conservation of energy
Replacement of conventional light ittings with LED light ixtures Usage of "Servo Machine" for plastic moulding instead of non-servo machines to save power by 15%.
Use of "UV process" instead of lamination for packaging, a chemical treatment of paper which is biodegradable and 100% recyclable.
Redesign of pay off fixtures in cables division to reduce energy consumption by 40%.
Optimisation of products and processes to minimise waste generation and address environmental and safety concern.
Use of power saving lamps for assembly areas
Optimum utilisation of available resources and eliminating ideal running of machines. Implementing best practices across all plants by using energy efficient equipment.
(ii) The steps taken by the Company for utilising alternate sources of energy
Installation of Solar panel of 15 Kw having capacity to operate 150 tube lights and 40 heavy motor fans.
(iii) The capital investment on energy conservation equipment
Investment of Rs. 15 lacs on solar panel.
(B) TECHNOLOGY ABSORBTION
The Company is constantly upgrading the technology used in production process to foster the growth of technical environment. It tends to acquire technical know-how from time to time for managing its position in the market and also to deal with the competitive world. This has enabled the Company to keep abreast with the latest developments in product technology, manufacturing process and methods, quality assurance and improvement, marketing, management systems
| (i) The efforts made towards technology absorption: |
| Launched new product range VYOMA for modular switches. |
| Creating breakthrough technologies for new businesses. |
| Launched new variant of OCEAN having double ball bearing motor. |
| The company is focused on nurturing an innovative culture. |
| Design and development of energy efficient induction motor for ceiling fans. |
| (ii) The bene its derived like product improvement, cost reduction, product development or import substitution |
| To attain market leadership and competitive advantage, the company went through various upgradations and improvements. |
| Improvement in production chain. |
| Development of in house domain expertise to support product development. |
| Innovating products to deal with ever - changing needs and environment. |
| Customizing products with need of the hour and with view of customer satisfaction. |
| A variety range of products with unique colour combinations suitable to consumer needs. |
| Quality improvement and increased productivity. |
(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the inancial year
The company imported indispensable resources as they were available at reasonable prices as compared to the native country. Such resources have been utilised to their full ef iciency and it has given a good impact on the product as well.
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO
The company imports some technology for production of final goods, such import is necessary for the creation of final product (the output). It manages such imports as it is more feasible for the company keeping in mind the financial resources.
| (Amount in Rs.) | |
| PARTICULARS | AMOUNT |
| Foreign exchange earnings in terms of actual in low | 1,40,11,208/- |
| Foreign exchange outgo in terms of actual out low | 1,93,36,523/- |
Management Discussion and Analysis
As per the terms of Regulation 34(2)(e) of the Listing Regulations, the Management Discussion and Analysis Report forms part of this Annual Report.
The Company tends to grow its environment in several aspects such as financial, human resource level, capital resource, technological, controlling and etc. keeping in mind its competitors and others threats in the market.
(a) Industry structure and developments
The Russia-Ukraine war disrupted the chances of global economic recovery from the COVID-19 pandemic, at least in the short term. The war between these two countries has led to economic sanctions on multiple countries, a surge in commodity prices, and supply chain disruptions, causing in lation across goods and services and affecting many markets across the globe. The electrical and electronics market is expected to grow to $4986.91 billion in 2027 at a CAGR of 7.5%. The renewable generation sector is a promoting and advancing alternative for green power generation. The main challenge with these resources is their uncertain power output, which can be compensated with storage systems and strong uncertainty management decision-making tools.
The escalating rate of global power consumption generates huge carbon emissions. Thankfully, electrical energy pollution is on the decrease in 2023 thanks to the widespread adoption of new, People greener lighting solutions with lower energy pro iles and higher illumination quality. today want their lights to be part of a super convenient and personally expressive domestic experience, and manufacturers are stepping up to the challenge. LED lighting in residential settings will continue to grow in popularity due to their several advantages. These include using up to 75% less energy while boasting a life expectancy that is 25 times longer than incandescent lights. (Source: https://yourpowerpro.com )
The Government of India have also taken e icient measures for the growth of industry such as the "Go Green" program the new ‘jeevan mantra: Make in India 2.0 seeking to protect the domestic manufacturers and pushing them up the value chain.
Company Overview
Veto Switchgears and Cables Limited is a diversifiied manufacturer of wires & cables, electrical accessories, industrial cables, fans, CFL lamps, pumps, modular switches, LED lights, immersion heater, MCB and distribution board, keeping in view the market demands and customer needs it tends to give satisfactory products to its customers. Having a diversified vision in every aspect of electrical manufacturing it believes in innovation and manages with dynamic changes in the market. Along with that Veto is Indias irst company to produce ISI mark electrical accessories
The company has a strong team of highly quali ied professionals who strive to innovate the best products with the use of advanced high tech machinery. A strong distribution network of 2500 dealers across the country to provide our quality products to our valued customers. The company is manufacturing all types of housing wires under the brand name VIMAL POWER which is a renowned brand in the western region of India. Company strives to set new benchmarks in providing high quality products at competitive rates.
(b) Opportunities and threats
O Opportunities:
Dynamical: The company has made immense efforts to sustain in the ever changing dynamic market, having unique style, variants and being satisfactory to consumer needs, it has evolved in maintaining such position.
Adaptable: The nature being unstable and having variations according to demands and needs of the hour, the company is adaptable to frequent changes and balancing its position for adapting changes entering in the market. It also focuses on getting informed prior to its competitors so that it can take advantage of the same.
Prosperity and living standards: Consumer preferences keeps on changing with respect to their income and it encourages consumers to shift their preferences to high quality appliances, modern solutions matching with their living standards.
Power saving products: Consumers have known the importance of environment and they are also concern about it, they prefer products which are energy efficient so that it can help in saving environment as well as bills.
O Threats:
Competitive intensity: For having a competition balance the industry is growing well, with this, new players come to the market which leads to greater competitive intensity.
In lation rate: High in lation rate results in slowdown of the economy which triggers a challenge to the business.
Demand: In this ever changing and developing environment, demand for the products keeps on changing affecting the production cycle of the product.
(c) Segment wise Performance
Veto brand is established in electrical industry since 1967 by delivering wide range of Wires & Cables, Electrical Accessories, Industrial Cables, Fans, etc. With each opportunity we intend to make best out of it, having view of customer satisfaction we encourage our team for betterment of the industry as a whole. Our segments are: -
WIRES AND CABLES
The global wires and cables market is projected to grow from $200.23 billion in 2022 to $294.73 billion in 2029, at a CAGR of 5.7% in forecast period. Increasing investments in transmission and distribution of electric power and growth in demand from data centres and the telecom industry will drive the wires and cables market growth during the projected period. High cash in low in smart grid projects and up-grading power transmission systems are also expected to boost the demand for wire and cables.
(Source: www.fortunebusinessinsights.com)
Construction cables and wire sector anticipated to see steep growth in demands in coming days owing to huge governments spending in infrastructure, smart cities, and real estate boom. The growing trend of upgrading and replacing existing electric infrastructure has created a positive growth scenario for the wire and cable market. Increasing electricity demand due to population increase and fast industrialisation would propel market growth.
Companys wires and cables division registered revenues of Rs. 6319.16 Lakhs during FY 2022-23 as compared to revenues of Rs. 6779.70 Lakhs in FY 2021-22.
ACCESSORIES & OTHERS
The global switchgear market size is projected to reach $170.40 billion by 2027, exhibiting a CAGR of 6.6% during forecast period. The rapidly growing electri ication need in remote areas coupled with the increasing electricity generation has positively affected the growth of various electrical equipment. The increasing targets by regional government for delivering electricity in rural areas and rising investments in this industry are the key switchgear market trends that are projected to cater the market growth. (Source: www.fortunebusinessinsights.com)
Electrical switchgear is a combination of electrical components designed to regulate, control, and protect the electricity generation, transmission, and distribution equipment. The global electrical switchgear market is anticipated to grow in the coming years owing to the rise in demand for medium and high voltage electrical switchgear. Also, the increasing demand for transformers is expected to fuel the growth of this market segment, as revenue in the electrical switchgear market is directly proportional to demand transformers.
Distribution of electricity in the real estate, construction, and industrial infrastructure sector requires several electrical components. Therefore, the growth in these sectors is expected increase the safety measures in electrical transmissions, fueling the demand for high demand for integrating renewable energy sources in the electrical switchgear. The power and energy sector will continue to drive the demand for electrical switchgear to ensure safety and protection of electricity transmission and distribution networks. (Source: www.in initiresearch.com)
Companys accessories & others division registered revenue of Rs. 4551.50 Lakhs during FY 2022-23 as compared to revenues of Rs. 3948.48 Lakhs in FY 2021-22.
LIGHTINGS AND FITTINGS
The global lighting size is projected to reach USD 163.72 billion by 2027, exhibiting a CAGR of 4.3% during forecast period. Light play an important role in every sector. The applications of light in activities such as interior designing, photography and other uses are rising with the increase in population and fascinating demands of such population. Numerous scientists have indicated the usage of LEDs in growing plants through practical evidence. Demand for LED plays an important role in plant growth and development, as its converts electricity into light by using the properties of metal, thereby delivering white light.
Government in several countries across the world are focusing on implementing regulations on energy efficient products. In our country Government is focused on developing new houses for homeless people, which in turn is driving the lighting market growth in the region. Furthermore, over the past few decades, the industry has witnessed the integration of concepts such as artificial intelligence and the Internet of things (IoT). The use of these concepts has allowed light manufacturing companies to develop innovative products. (Source: www.fortunebusinessinsights.com)
Veto is well placed in the smart lighting, LED, fan, CFL and other fancy lighting segment with a strong product pro ile, well-entrenched trade network along with supportive consultants and contractors. It is more inclined towards producing and selling lights at minimum rates, so that people can a ord and use it for a long duration of time.
Companys lightings and fittings division registered revenues of Rs. 8752.16 Lakhs during FY 2022-23 as compared to revenues of Rs. 6637.65 Lakhs in FY 2021-22.
(d) Outlook
The company has a diversified product portfolio and well maintained distribution network. The management of the company is quite experienced and understanding, coping with all the changes in the industry. Teamwork is a core of the company as work is done with less time yet efficiently. The rapid pace of innovations in the field is stimulating consistent demand for newer and faster equipment. Technological development is a key to attracting both consumers and business users for either replacing or upgrading the older products with advanced version. The level of competitive intensity has increased signifiicantly in recent times. However, the strength of the Companys product portfolio, its distribution network and its brands will enable it to successfully deal with competitive pressures. The company intends to provide maximum satisfaction to its customers, employees and the environment. It plans to grow its sectors with innovative ideas relating to consumer preferences, keeping in mind substantial and biodegradable products having a motive of optimum utilization of resources.
(e) Risks and concerns
1. Common risks such as accidents in the workplace, ires, etc.
2. Natural disasters such as earthquake, tornadoes, etc.
3. Uncertainties in inancial market
4. Credit risk
5. Interest rate risk
6. Security and storage of data and records
7. Disruption in supply chain
8. Financial instruments affected by market risk including loans, borrowings, trade payables and deposits.
The Company has a risk identification and management framework appropriate to it and to the business environment under which it operates. Risks are being identi ied at regular intervals by the Board.
The Company has a Risk Management Policy, which provides an overall framework of Risk Management in the Company. The Board of Directors are responsible for the assessment, formulation and implementation of guidelines, managing key risks, risk minimization procedures and periodicals review.
(f) Internal control systems and their adequacy
The company has adequate systems of internal control commensurate with its size and the nature of its operations. These have been designed according to the requirements of the Companies Act, 2013 and the globally accepted framework issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission, to provide reasonable assurance with regard to recording and providing reliable financial and operational information, safeguarding assets from unauthorized use or losses, executing transactions with proper authorization and ensuring compliance with corporate policies. The company has a well-defined manual for delegation of authority, approving revenue and expenditure. The company uses an updated system to record data for accounting, consolidation and management information, connecting to different locations for the exchange of information. The Audit Committee of the board periodically reviews Internal Audit reports, progress in implementation of Committees recommendations and the adequacy of internal control systems.
Vigil Mechanism and Whistle Blower Policy
The Policy provides a framework to promote responsible and secure reporting of undesirable activities ("whistle blowing"). Through this Policy, the Company seeks to provide a mechanism to the whistleblower to disclose any misconduct, malpractice, unethical and improper practice taking place in the Company for appropriate action and reporting, without fear of any kind of discrimination, harassment, victimisation or any other unfair treatment or employment practice being adopted against the whistleblower.
The Audit committee of the company oversees vigil mechanism process of the company pursuant to the provisions of the Act. Employees may also report to the chairman of the Audit committee. A report on the functioning of the mechanism, including the complaints received and actions taken, is presented to the Audit committee on a quarterly basis.
No complaints were received during the financial year 2022-23.
(g) Financial Performance with respect to operational performance
This has been mentioned in Directors Report.
(h)Human Resources / Industrial Relations
Veto encourages a culture of trust and mutual respect, it strongly believes that its employees are the key pillar of your Companys success in the market. The talent pool of the company has steadily evolved with changing times with fresh talent being infused to meet demanding situations. Apart from continued investment in skill and leadership development of its people, the Company has also focused on employee engagement initiatives and drives aimed at increasing the culture of innovation and collaboration across all division of the workforce. Your Companys people strategy is aligned with its overall vision to be the pioneer in shaping the future of sustainable energy and your Company is committed to nurturing a cordial and diversified work environment in a growing market.
We humbly acknowledge the contribution with competitive compensation and bene its that appropriately reward performance. Inspired by the commitment to quality and core values of honesty and transparency, the directors and employees look forward to the future with con idence and stand committed for creating a brighter future for all our stakeholders.
The company have strength of 331employees as on 31st March, 2023.
KEY FINANCIAL RATIOS:
| Ratio | FY 2022-23 | FY 2021-22 | Change | Remarks |
| Current Ratio (times) | 4.58 | 2.98 | 53.56 | Due to decrease in current borrowings. |
| Debt- Equity Ratio (times) | 0.13 | 0.20 | -33.69 | Due to decrease in current borrowings. |
| Debt Service Coverage Ratio | 6.49 | 7.54 | -14.01 | Variance not more than 25% |
| Return on Equity (ROE) | 11.42% | 12.62% | -1.20% | Variance not more than 25% |
| Inventory turnover ratio | 2.11 | 1.82 | 28.71% | Due to decrease in average inventory |
| Trade Receivables Turnover Ratio | 2.41 | 2.55 | -5.21 | Variance not more than 25% |
| Trade Payable Turnover Ratio | 8.53 | 12.35 | -30.93 | Due to increase in Trade Payables |
| Net Capital Turnover Ratio | 1.51 | 1.71 | -11.61 | Variance not more than 25% |
| Net Profit Ratio | 11.65% | 13.03% | -1.37% | Variance not more than 25% |
| Return on Capital Employed (ROCE) | 14.67% | 15% | -0.33% | Variance not more than 25% |
| Return on Investment (ROI) | 21.04% | 18.55% | 2.49% | Variance not more than 25% |
COMPETITION
The market comprises of international and regional / local vendors who faces intense competition from the unorganized vendors. The regional and unorganized players in the market offer products at a comparative price which induces the well-established international electric wire and cable manufacturers to focus on differentiating their products to sustain their market shares. In addition to innovative product offerings, cable and wire manufacturers have also entered into various business strategies such as mergers and acquisitions to acquire new technologies and have expanded their customer reach.
The leading vendors in the market are
| Finolex Cables |
| Havells India |
| KEI Industries |
| Polycab Wires |
The other prominent vendors in the markets are Cable Corporation of India, Apar Industries Limited, Cords Cable Industries, KEC International, LS Cable India, Shilpi Cable Technologies, Universal Cable, and V-Guard Industries, Orient Electric Ltd, Crompton Greaves Consumer Electrical Ltd, ABB India Ltd, and Siemens Ltd.
Your company has strong and efficient team of marketing professionals, dealers and distributors and is very well prepared to face the competition and to cater the consumer needs by enhancing its own brand in the industry.
MARKETING SETUP
Veto holds a major part of market share of electrical accessories in India. The company has a strong and efficient team of marketing professionals, dealers and distributors. Our Promoters carry and share their vast experiences in the marketing segment of wires and cables, electrical accessories & other allied products. They have been indulging into manufacturing and marketing segments for Veto Brand products for the past over 55 years. Veto holds a recognized reputation among its dealer network consisting of more than 3000 in numbers. The selling price of the components to be manufactured is decided on the basis of design complexities, material used, process gone through, quantity, period of supply, etc.
Your Company had major earnings from the state of and now Madhya Rajasthan and Karnataka also forms the part of the major earnings due to our continuous focus on Pradesh and Uttar Pradesh widening and covering more and more states of India. Almost 15 states have become a major part of our distribution network, including Gujarat, NCR, Haryana, Punjab, Himachal Pradesh, J&K, Uttarakhand, Assam, Andhra Pradesh, Telangana, Kerala, Maharashtra and Tamilnadu.
The company has broadened its network and distribution channels. Our products are marketed in both domestic and international markets. We have also entered into International Market by distributing our dynamic varieties of electrical products in cities of UAE and got a major success over there. The company and its Board is continuously putting efforts toward making Veto a globally established brand.
STRENGTH & WEAKNESS
O Strength
Established brand in North West India, South and central
Experienced management team
Organized and comprehensive product offering
Established reputation for quality products
Driving growth through innovation and marketing
Our relationship with customers
Our relationship with more than 3000 dealers
Dedicated team of technical manpower
Union Budget allocated high expenditure in IFRA Sector
"Pradhan Mantri Awas Yojana" in Remote Area
O WEAKNESS
Players in regional market.
Any avoidance of rules of Government caused under unavoidable circumstances may have an adverse impact on the project.
Dependency on suppliers of raw materials.
DISCLAIMER CLAUSE
Statements in Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions are forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those either expressed or implied. Important factors that could make a difference to the Companys operation include among others, economic conditions affecting demand /supply and price conditions, variation in prices of raw materials, changes in Government regulations, tax regimes, economic developments and other incidental factors.
OTHER DISCLOSURES
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions/events on these items during the year under review: -
March 2023, none of the Directors of the company hold instruments convertible into As on 31st equity shares of the Company.
Company has not granted any stock option or issue sweat equity shares during the year.
The Business Responsibility Reporting as required by Regulation 34(2) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, is not applicable to your Company for the inancial year ending March 31st, 2023.
No application was made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 during the year in respect of your Company.
There was no one-time settlement of loan obtained from the Banks or Financial Institutions.
ACKNOWLEDGEMENT
We thank our customers, vendors, investors and bankers for their intense support throughout the year. We place on record our appreciation of the contribution made by our employees at all levels. We thank the Government of India, particularly the Ministry of Commerce, Ministry of Finance, Ministry of Corporate A airs, the Custom and Excise Departments, Income Tax Department, the Reserve Bank of India, the State Government(s) and other government agencies for their support, and look forward to their continued support in the future.
| Date: 04/09/2023 | |
| Place: Jaipur | |
| For and on behalf of the Board of Directors | |
| Akshay Kumar Gurnani | Narain Das Gurnani |
| Whole-Time Director & CFO | |
| Managing Director & CEO | |
| DIN: 06888193 | DIN: 01970599 |
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ATTENTION INVESTORS
- Prevent Unauthorized Transactions in your demat / trading account Update your Mobile Number/ email Id with your stock broker / Depository Participant. Receive information of your transactions directly from Exchanges on your mobile / email at the end of day and alerts on your registered mobile for all debits and other important transactions in your demat account directly from NSDL/ CDSL on the same day." - Issued in the interest of investors.
- KYC is one time exercise while dealing in securities markets - once KYC is done through a SEBI registered intermediary (broker, DP, Mutual Fund etc.), you need not undergo the same process again when you approach another intermediary.
- No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries for refund as the money remains in investor's account."
www.indiainfoline.com is part of the IIFL Group, a leading financial services player and a diversified NBFC. The site provides comprehensive and real time information on Indian corporates, sectors, financial markets and economy. On the site we feature industry and political leaders, entrepreneurs, and trend setters. The research, personal finance and market tutorial sections are widely followed by students, academia, corporates and investors among others.
Risk Disclosure on Derivatives
- 9 out of 10 individual traders in equity Futures and Options Segment, incurred net losses.
- On an average, loss makers registered net trading loss close to Rs. 50,000.
- Over and above the net trading losses incurred, loss makers expended an additional 28% of net trading losses as transaction costs.
- Those making net trading profits, incurred between 15% to 50% of such profits as transaction cost.
Copyright © IIFL Securities Ltd. All rights Reserved.
Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213, IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
We are ISO 27001:2013 Certified.
This certificate demonstrates that IIFL as an organization has defined and put in place best-practice information security processes.