Virtuoso Optoelectronics Ltd Directors Report

Dear Member(s),

Your directors take immense pleasure in presenting the 9th Annual Report on the business and operations of your Company along with its Audited Financial Statements for the year ended on 31st March, 2024.

Financial Summary

The financial statements of your Company are prepared in accordance with the applicable provisions of the Companies Act, 2013 (the ‘Act) including Accounting Standards as specified in Section 133 of the Act, read with the Companies (Accounts) Rules, 2014, and amendments thereof.

The financial performance of the company during the year is as under:

(Rs. In lakhs)

	For the year ended
Particulars	March 31, 2024	March 31, 2023
Revenue From operations	53,108.41	33,726.51
Other Income	122.01	80.7
Total Income	53,230.42	33,807.21
Total Expenses	51,800.23	32,678.12
Profit/Loss before Exceptional Items and Tax	1,430.19	1,129.09
Add/(Less): Exceptional Items	-	-
Profit before Tax	1,430.19	1,129.09
Tax Expense	250.00	198.00
Profit after Tax	1180.19	931.09
Deferred Tax	167.45	154.38
Profit for the year	1,012.73	776.71

Operational Overview

Your Company offers widest ranges of air conditioning and lighting products. It fulfills the lighting & air-conditioning requirements of a large number of corporate customers. Your Company continues to operate in one segment i.e., manufacturing, selling and marketing of white Goods and there is no change in the nature of Business of your Company.

Revenue from operations for the current financial year grew 57.45% to 53,108.41 lakhs as compared to 33,726.51 lakhs in the previous financial year. Net profit for the current financial year increased by 30.39% to 1,012.73 lakhs as compared to 776.71 lakhs in the last financial year. Company has generated record revenue and profits.

Dividend

In view of the planned business growth, your directors estimate it proper to preserve the resources in order to fund new growth opportunities and therefore, do not propose any dividend for the Financial Year ended March 31, 2024.

Reserves

The amount of profit of 1,012.73 lakhs is transferred to the Reserve and Surplus Account for the year under review.

Share Capital Structure

Your Company has increased Authorized share capital from 26,00,00,000 (divided into 2,60,00,000 equity shares of 10/- each) to 35,00,00,000 (divided into 3,50,00,000 equity shares of 10/- each), vide ordinary resolution passed in the extra-ordinary general meeting held on February 03, 2024.

The Issued, Subscribed and Paid-up equity share capital has also been increased from Rs. 22,83,86,560 to Rs. 26,33,87,560 pursuant to the preferential issue for which allotment was done on March 02, 2024.

As on 31st March, 2024 the Issued, subscribed and paid up capital was 26,33,87,560/- (divided into 2,63,38,756 equity shares of 10/- each.)

Funds Raised During The Year

Preferential Issue

Preferential issue was approved for fresh issue of 35,00,100 equity shares having face value of 10/- each at a premium of 245.10/- per share at the Board Meeting held on January 11, 2024 by the board of directors and passed with requisite majority at the Extra Ordinary General Meeting held on February 03, 2024 by the shareholders of your company and your company has received the In-principle from BSE Limited on February 20, 2024.

Your company has allotted equity shares on March 02, 2024. The Listing approval of equity share from BSE Limited has not been received due to increase of paid-up capital beyond 25 Crores. Accordingly, the credit of Equity Shares from CDSL and NSDL is also pending and hence 3,500,100 Shares are not tradable on Stock Exchange.

During the period under review, your Company has not bought back any of its securities / has not issued any Sweat Equity Shares / has not issued any Bonus Shares/ has not issued shares with Differential Voting rights and there has been no change in the voting rights of the shareholders.

Employees Stock Option Plan

The board of directors had proposed “VOEPL” Employee Stock Option Plan 2023. The “VOEPL” Employee Stock Option Plan-2023 was approved on January 30, 2023 by Board of Directors and on February 24, 2023 by shareholders by passing Special Resolution. Board of directors has reserved 20,00,000 options under this plan for employees. During the year, your company had granted 2,59,140 options to employees at the price and terms as per the proposal by NRC committee and 12,820 ESOPs lapsed or cancelled. The details of “VOEPL Employee Stock Option Plan- 2023” (“ESOP 2023” or Scheme) are as provided below:

Particulars		Details
	From April 1, 2024 till date	FY 24	FY 23	FY 22
Total options outstanding as at the beginning of the period	20,00,000	20,00,000	20,00,000	Nil
Total options granted	2,59,140	2,59,140	Nil	Nil
Exercise price of options in (as on the date of grant options)	Nil	246.3	Nil	Nil
Options forfeited/lapsed/cancelled	12,820	12,820	Nil	Nil
Variation of terms of options	NA
Money realized by exercise of options during the year/period	NA
Total number of options outstanding in force at the end of period/year	19,87,180	19,87,180	20,00,000	Nil
Total options vested (excluding the options that have been exercised)	Nil	Nil	Nil	Nil
Options exercised	Nil
The total number of Equity Shares arising as a result of full exercise of granted options (including options that have been exercised)	Nil

 

	Details
Particulars	From April 1, 2024 till date	FY 24	FY 23	FY 22
Employee wise details of options granted to:
Key managerial personnel:	60,000	60,000	60,000	Nil
Any other employee who receives a grant in any one year of options amounting to 5% or more of the options granted during the year	Nil
(iv) Identified employees who were granted options during any one year equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of our Company at the time of grant	Nil
Lock-in period	NA

 

	Fully diluted EPS as per the Audited Financial Statements:
Fully diluted EPS on a pre-Offer basis pursuant to the issue of Equity Shares on exercise of options calculated in accordance with the applicable accounting standard on ‘EPS (in )	Particulars	FY 24	FY 23 31, 2023	FY 22 31, 2022
	Diluted EPS	4.38	4.28	3.11

 

	Black- Scholes formula
	Particular	Tranches 1	Tranches 2	Tranches 3	Tranches 4
Description of the pricing formula and method and significant assumptions used to estimate the fair value of options granted during the year including, weighted average information, namely, risk-free interest rate, expected life, expected volatility, expected dividends and the price of the underlying share in market at the time of grant of the option	Valuation date	August 10, 2023	August 10, 2023	August 10, 2023	August 10, 2023
	Volatility (S)	25%	25%	25%	25%
	Risk free rate	7.17%	7.16%	7.19%	7.19%
	Time to Expiration (T)	4.5 years	5.5 years	6.5 years	7.5 years

 

Impact on the profits and on the Earnings per Equity Share of the last three years if the accounting policies specified in the SEBI SBEB Regulations had been followed, in respect of options granted in the last three years	Not Applicable
Where our Company has calculated the employee compensation cost using the intrinsic value of the stock options, the difference, if any, between employee compensation cost so computed and the employee compensation calculated on the basis of fair value of the stock options and the impact of this difference, on the profits of our Company and on the Earnings per Equity Share of our Company	Yes
Intention of the Key Managerial Personnel, Senior Management Personnel and whole-time directors who are holders of Equity Shares allotted on exercise of options granted to sell their Equity Shares within three months after the date of listing of Equity Shares pursuant to the Offer	No options exercised, hence not applicable
Intention to sell Equity Shares arising out of “VOEPL Employee Stock Option Plan- 2023” (“ESOP 2023” or Scheme) within three months after the listing of Equity Shares, by Directors, Key Managerial Personnel, Senior Management Personnel and employees having Equity Shares arising out of an employee stock option scheme, amounting to more than 1% of the issued capital (excluding outstanding warrants and conversions) of our Company.	No options exercised, hence not applicable

Maintainance of cost records

The Company has adequately maintained the cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013.

State of company affairs

The state of your Companys affairs is given under the heading ‘Financial Summary/ Highlights, Overview of Companys Performance and various other headings in this Report and the Management Discussion and Analysis Report, which forms part of the Annual Report.

Investor education and protection fund

During the year under review, Our Company was not required to transfer any funds to Investor Education and Protection Funds (IEPF).

Committees Of The Board

The Board had duly constituted following Committees, which are in line with the provisions of applicable laws:

A. Audit Committee

B. Nomination and Remuneration Committee

C. Stakeholders Relationship Committee

D. Management/Executive Committee

E. Corporate Social Responsibility Committee

A detailed update on the composition, number of meetings, attendance and terms of reference of aforesaid Committees are provided in the section “Committees of the Board” of “Corporate

Governance Report.”

Public Deposit

During the year under review, the Company has not accepted any public deposit during the year under review and no amount against the same was outstanding at the end of the year.

Material changes and commitments affecting the financial position of the company

There were no such material changes and commitments affecting the financial position of your Company which have occurred between the end of the Financial Year of your Company to which the Financial Statements relate and the date of Board Report.

Declaration By Independent Directors

Necessary declarations from each Independent Director of the Company are received, confirming that he/she met with the criteria of independence as laid out in sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 16(1)(b) of the Listing Regulations, 2015.

Board Evaluation

As per the provisions of the Companies Act, 2013 and Listing Regulations 2015, The Board adopted a formal mechanism for evaluating its performance and as well as that of its committees and individual Directors, including the Chairman of the Board. The exercise was carried out through a structured evaluation process covering various aspects of the Boards functioning such as composition of the Board & committees, experience & competencies, performance of specific duties & obligations, contribution at the meetings and otherwise, independent judgment, governance issues etc.

Changes In Key Managerial Personnel

During the Financial year 2023-24,

1. Mr. Hariom Kushawaha, Company Secretary & Compliance Officer of the Company has resigned w.e.f. January 27, 2024.

2. Ms. Vibhuti Kulkarni, was appointed as Company Secretary & Compliance Officer of the company w.e.f. January 28, 2024.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As required under Section 134 (3) (m) of the Act read with Rule 8 of The Companies (Accounts) Rules, 2014, are set out in the annexure to the Directors Report as Annexure - 1.

Health, Safety And Environment

The Company is continuously focusing on improved training, new initiatives and communications enhancing safety in the work place. Safety and occupational health responsibilities are integral to your Companys business process. Safety is a key performance indicator and your Company is committed to ensuring zero harm to its employees, to any person in the Company premises and to the community. Company has implemented various measures in light with the requirement of safety and ensuring the health of its employees:

1. Regular safety training sessions are conducted for employees to enhance their knowledge and skills in identifying and mitigating potential hazards.

2. Performed regular safety inspections and audits to identify and address potential safety risks and ensure compliance with regulations.

3. Mock Drills are Conducted for potential emergencies.

4. Periodic Employee Recognition and Motivation for their contributions to safety, promoting a safety-first culture.

5. Annual medical checkups for employees to monitor their health and well-being, and provide early intervention and support as needed.

Apart from safety initiatives, your Company is also focusing on environment protection with below activities are monitored and conducted during the year:

1. Ensured compliance with environmental regulations and standards.

2. Implemented effective waste management practices to minimize waste and promote recycling.

3. Implemented energy-efficient practices to reduce energy consumption.

4. Promoted sustainable practices throughout the organization.

Company has ensured compliance with Commitment to Health Safety and Environment protection measures via below activities:

1. Monthly Safety Committee Meetings to discuss safety concerns, incidents, and best practices.

2. Incident Reporting and Investigation to identify root causes and implement corrective actions.

3. Continuous Improvement with employee suggestions and ideas welcomed and implemented.

4. Periodic review of HSE policies and objectives to ensure alignment with organizational goals and regulatory requirements.

The Company is in compliance with the provisions of E-Waste (Management) Rules, 2022 from Central Pollution Control Board (CPCB) of the Government of India.

Board Of Directors, Its Committees And Meetings Thereof

Pursuant to Section 152 of Companies Act, 2013, Mr. Sukrit Bharati, shall retire by rotation at the ensuing Annual General Meeting being eligible offers himself for re-appointment for directorship of the company.

Mrs. Komal Kotecha, (DIN: 09141355) has resigned as an Independent Director w.e.f. May 29, 2023.

Ms. Ila Bhat (DIN: 10605053) was, on recommendation of Nomination and Remuneration Committee, appointed by the Board of Director as additional director (Non-Executive, Independent) under section 161 of the Companies Act, 2013 w.e.f. April 29, 2024, She was regularized in the Extra Ordinary General Meeting of the company which was held on 26.07.2024.

The requisite particulars in respect of Directors seeking appointment / re-appointment are given in Notice convening the Annual General Meeting.

All the directors of the Company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013.

Details of policy of appointment and remuneration of directors have been provided in the Corporate Governance Report.

Policies

The updated policies adopted by the Company as per statutory and governance requirements are uploaded on website of the Company at www.voepl.com.

Particulars Of Employees

A statement containing the names and other particulars of employees in accordance with the provisions of section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure - 2 to this report.

The information required under Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forms part of this Annual Report.

Having regard to the provisions of Section 134 and Section 136 of the Companies Act, 2013, the Reports and Accounts are being sent to the members excluding such information. However, the said information is available for inspection for members at the registered office of the Company during business hours on working days of the Company up to the date of ensuing AGM. Any shareholder interested in obtaining a copy of such statement may write to the Company Secretary at the registered office of the Company or e-mail to cs@voepl.com.

Details Of Related Parties Transactions Purusant To Section 188(1) Of The Companies Act, 2013

Pursuant to the provisions of section 188 of Companies Act, 2013. All the related party transactions entered into during the financial year under review were in ordinary course of business and on an arms length basis. There were no materially significant transactions with related parties during the financial year which were in conflict with the interest of the Company. Accordingly, information in form AOC-2 is not annexed.

All Related Party Transactions are placed before the Audit Committee and the Board for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are placed before the Audit Committee and the Board of Directors for their review and approval on a quarterly basis.

Other details for inter corporate financial transactions or remuneration and other benefits paid to directors, their relatives, key managerial personnel etc. are given as per requirements of AS 18.

Details Of Loans, Guarantees And Investments U/S 186 Of The Companies Act, 2013

During the year under review the Company has not made any inter corporate loans, investments, given any corporate guarantee to any other body corporate, subsidiary, associate or any other company

AUDITORS

Statutory Auditors

M/s. Jain Chhajed & Associates, Chartered Accountants, an Auditors firm was appointed as Statutory auditors of the company, for the second term of five consecutive years at the 6th Annual General Meeting held on Thursday, June 3, 2021. As per Rule 6(3) of the Companies (Audit and Auditors) Rules 2014, they are eligible to continue as the statutory auditors. They have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Notes on financial statement referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation, adverse remark or disclaimer.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013, read with rules made thereunder, the Board of Directors has appointed M/s Prachi Bansal & Associates, Practicing Company Secretaries, as Secretarial Auditor to conduct Secretarial Audit of the Company for the Financial Year 2023-24. The report submitted by the Secretarial Auditor in Form MR-3 is attached to this report as Annexure - 3. The Secretarial Auditor Report does not contain any qualification, reservation or adverse remark.

Cost Auditors

In terms of the provisions of Section 148 of the Act, read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors had, on the recommendation of the Audit Committee, appointed KPMSS & Associates, Cost Accountants, Nashik, as the Cost Auditors, to conduct the cost audit for the financial year ended March 31, 2024.

As required under the Act, the remuneration payable to the cost auditor is 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 Cost Auditors, forms part of the Notice convening the Annual General Meeting.

Internal Auditors

In terms of the provisions of Section 138 of the Act read with Companies (Account) Rules, 2014, the Company has re-appointed M/s Pooja M. Kulkarni & Co., Chartered Accountants, Nashik as the internal auditors.

Reporting Of Frauds By Auditors

During the year under review, none of the auditors, viz., statutory auditors, cost auditors, and secretarial auditors, and internal auditors have reported to the Audit Committee, under Section 143(12) of the Act, any instances of fraud committed against the Company by its officers or employees, the details of which would need to be mentioned in the Boards Report.

Annual return

The Annual Return of the Company as on March 31, 2024 is available on the website of the Company at www.voepl.com.

Management Discussion And Analysis Report

Management Discussion and Analysis Report prepared pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations; 2015 forms part this Directors Report is attached as Annexure - 4.

Corporate Governance

Corporate Governance Report prepared pursuant to SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Directors Report.

During the year under review, your company has complied with the applicable Secretarial Standards.

Insurance

The Fixed Assets and Stocks of your Company are adequately insured.

Risk Management And Internal Control System

Your Company has an Internal Financial Control System commensurate with the size, scale and complexity of its operations. Your Company has adopted proper system of Internal Control and Risk Management to ensure that all assets are safeguarded and protected against loss from unauthorized use or disposition and that the transactions are authorized, recorded and reported properly.

The effectiveness of internal financial controls is reviewed through the internal audit process. Reports of internal auditors are reviewed by Audit Committee of the Company and desired actions are initiated to strengthen the control and effectiveness of the system.

Corporate Social Responsibility (CSR) Initiatives

During the year, the company has constituted the CSR Committee due to applicability of the provisions sub-section (1) of Section 135 of the Companies Act, 2013.

The details of the CSR Committee are provided in the Corporate Governance Report, which forms part of this Integrated Annual Report. The CSR policy is available on the website of your Company at https://www.voepl.com/investors. The Annual Report on CSR activities is annexed and forms part of this report. Your Company has spent more than 2% of the average net profits of your Company, during the three years immediately preceding financial year. The Chief Financial Officer of your Company has certified that CSR spends of your Company for FY24 have been utilized for the purpose and in the manner approved by your Board of your Company.

Our Company has Utilized CSR Funds for Apprenticeship Training Under ‘Skill Training Under Item No. (ii) Of Schedule VII of The Companies Act. We have imparted training to 109 apprentices under a government registered scheme of WIL, NEEM, Flexi- MOU, NAPS for the Various purposes like training for MI- Line, Wave Soldering, Assembly, SMT, Store, QA, R&D etc.

Prevention of Sexual Harassment of Women At Workplace

The Company is committed to provide a safe and conducive work environment to its employees. As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and rules made there under. Your Company has constituted Internal Complaints Committee (ICC) which is responsible for redressal for complaints related to sexual harassment. During the year under review, there were no complaints pertaining to sexual harassment.

Directors Responsibility Statement

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, hereby confirm that:

• in the preparation of the annual financial statements for the financial year ended 31st March, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

• the directors have selected such accounting policies have been selected and applied them consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2024 and of the loss of the Company for the year ended on that date;

• the directors have taken proper and sufficient care has been taken 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;

• the annual financial statements have been prepared on a going concern basis;

• the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and operating effectively;

• the directors have advised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

Acknowledgements

Your directors place on records their sincere appreciation for the valuable support and cooperation received from Government of India and regulatory authorities, financial institutions and banks associated with the Company during the year. Your directors thank all shareholders, esteemed customers, suppliers and business associates for their faith, trust and confidence reposed in the Company.

Your directors also wish to place on record their sincere appreciation for the dedicated efforts and consistent contribution made by the employees at all levels.

The Directors look forward to your continuing support.

By Order of the Board of Directors

For Virtuoso Optoelectronics Limited

Sukrit Bharati

Chairman & Managing Director

DIN: 03638084

Date : June 21, 2024

Place : Nashik