vms industries ltd share price Directors report


Your Directors present herewith their 31st (Thirty First) Annual Report of your Company together with the Audited Financial Statements for the Financial Year (FY) ended March 31, 2023.


The financial performance of the Company for the Year ended 31st March, 2023 is summarized as below:-

Rs. In Lakhs



Year Ended on 31.03.2023 Year Ended on 31.03.2022

Income / Receipts from Operations

14038.87 15764.04

Other Income

537.42 549.61

Total Income

14576.29 16313.65

Earning Before Financial Charges, Depreciation, and Taxation (EBITDA)

501.67 379.92

Financial Charges

164.96 193.80


38.36 38.19

Profit Before Tax (PBT)

298.35 147.93

Less: Provision for Taxation including Deferred

48.60 40.22

Profit After Tax (PAT)

249.75 107.71

Profit Brought Forward from Previous Year

1771.77 1644.06

Profit Available for Appropriation

2021.52 1771.77

Balance Carried to Balance Sheet

2021.52 1771.77


During the year, under review, the revenue from operations amounted to Rs. 14038.87 Lakhs (as against the previous year figure of Rs. 15764.04 Lakhs. In-spite of overall slowdown in the economy, the Company was able to generate Net Profit After Tax amounted to Rs.249.75 Lakhs as against the previous year figure of Rs.107.71 lakhs.


We maintain sufficient cash to meet our strategic objectives. We understand that liquidity is necessary to cover Business and Financial risks. Excess funds are invested in deposits with Bank having special rates of interest or by providing short Terms Loan and Advances to parties which is receivable on demand so that funds are readily available at any time period to meet requirement of our business.


Looking to future requirements of funds for business operations of the Company, the directors have not recommended any dividend for the Financial Year 2022-23.


Our Company is also optimistic that with the stabilization in price for the old ship in the international markets and in the sale price of recycled products in the domestic market, the Company will be able to improve the turnover and the profitability ratios in the coming years.


The Board of Directors has decided to retain the entire amount of profits for FY 2022-23 in the Retained Earnings.


The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the Balance Sheet.


Company has obtained the credit rating from CARE are as follow


Amount (Rs. In Crore) Ratings Rating Action

Long Term/Short Term Bank Facilities

138.00 CARE BBB-; Stable/CARE A3 (Triple B Minus; Outlook: Stable/ A Three) Reaffirmed

Short Term Bank Facilities

5.50 CARE A3 (A Three) Reaffirmed




The Company had one subsidiaries company M/s VMS TMT PVT LTD till 30th August, 2020 and there is no joint venture with the Company. RELATED PARTY TRANSACTIONS

All related party transactions entered into during FY 2022-23 were on an arms length basis and in the ordinary course of business. No material related party transactions were entered into during the financial year by the Company. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Act in Form AOC-2 is separately attached herewith in Annexure-I.

The details of the transactions with related parties are also provided in the accompanying Financial Statements.


Pursuant to Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the Management Discussion and Analysis is presented in a separate section forming part of this Annual Report as Annexure - II. As required under the provisions of the Listing Regulations, the Audit Committee of the Company has reviewed the Management Discussion and Analysis report of the Company for the year ended March 31, 2023.


The Company has adopted a Whistle blower Policy and Vigil Mechanism to provide a formal mechanism to the Directors, employees and other external stakeholders to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Companys Code of Conduct. The Policy provides for adequate safeguards against victimisation of employees who avail of the mechanism and also provides for direct access to the Chairperson of the Audit Committee.

No personnel of the Company has been denied access to the Audit Committee. The Whistle blower Policy and Vigil Mechanism ensures that strict confidentiality is maintained in such cases and no unfair treatment is meted out to a Whistle blower. The Company, as a Policy, condemns any kind of discrimination, harassment, victimisation or any other unfair employment practice being adopted against Whistle blowers.

The Policy is also posted on the website of the Company at: http://www.vmsiLm/uploads/2/8/88/28880383/whistle-blower-policy-.pdf


The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There was no case of sexual harassment reported during the year under review.


No significant and material orders were passed by the regulators or the courts or tribunals impacting the going concern status and Companys operations in future.


Internal financial control systems of the Company are commensurate with its size and the nature of its operations. These have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information, complying with applicable accounting standards and relevant statutes, safeguarding assets from unauthorised use, executing transactions with proper authorisation and ensuring compliance of corporate policies.

The Audit Committee deliberated with the members of the management, considered the systems as laid down and met the internal auditors and statutory auditors to ascertain, their views on the internal financial control systems. The Audit Committee satisfied itself as to the adequacy and effectiveness of the internal financial control system as laid down and kept the Board of Directors informed. However, the Company recognises that no matter how the internal control framework is, it has inherent limitations and accordingly, periodic audits and reviews ensure that such systems are updated on regular intervals.


Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo as required under Section 134 (3) (m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 for the financial year ended 31st March 2023 are given in Annexure - III attached hereto and forming part of this report.


Pursuant to provision of Section 92 and 134 and other applicable provision of the Companies Act, 2013 and of Rule 12 (1) of Companies (Management and Administration) Rules, 2014 the extract of the annual return in form MGT 9 for the Financial Year ended on 31st March, 2023 is available at Companys Website: www.vmsil.in.


In accordance with the provisions of Section 152 of the Act and the Articles of Association of the Company Mr. Ajit Kumar Jain (DIN: 00114766), Director of the Company, retires by rotation at the ensuing AGM and being eligible, has offered himself for re-appointment. None of the Directors of the Company are disqualified under section 164 of the Companies Act, 2013 from being appointed as a Director of any public Company. The Board recommends her reappointment for your approval.

Independent Directors

In terms of Section 149 of the Act, Mr. Bakul Mehta, Mr. Pranav Parikh and Mr. Hitesh Loonia, are the Independent Directors of the Company. The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and regulation 16(1) (b) of the Listing Regulations and are independent from the management. The Independent Director of the Company holds office for the term of five years. In terms of the provision of Companies Act, 2013 the independent Directors are not liable to retire by rotation.

The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise in the fields of Finance and taxation, technology, digitalisation, human resources, strategy, auditing, tax corporate governance, etc. and that they hold highest standards of integrity.

Brief resumes of the above Directors, nature of his expertise in specific functional areas and names of the Public Limited Companies in which she hold Directorships and Memberships / Chairmanships of Committees of the Board and their shareholding in the Company, as stipulated under LODR, 2015 of the Listing Agreement are given in the Report on Corporate Governance forming part of the Annual Report.

Key Managerial Personnel (KMP)

In terms of the provisions of Section 2(51) and Section 203 of the Act, the following are the KMP of the Company:

• Mr. Manojkumar Jain, Managing Director (MD)

• Mrs. Sangeeta Jain, Whole Time Director (WTD)

• Mr. Hemal Patel, Company Secretary (CS)

• Mr. Amit Mandaia Chief Financial Officer (CFO)

Board Evaluation

The Board has carried out the annual evaluation of its own performance and that of its Committees and individual Directors for the year pursuant to the provisions of the Act and the corporate governance requirements prescribed under the Listing Regulations.

The performance of the Board and individual Directors was evaluated by the Board after seeking inputs from all the Directors. The criteria for performance evaluation of the Board was based on the Guidance Note issued by SEBI on Board Evaluation which included aspects such as Board composition and structure, effectiveness of Board processes, contribution in the long term strategic planning, etc. The performance of the Committees was evaluated by the Board after seeking inputs from the Committee Members. The criteria for performance evaluation of the Committees was based on the Guidance Note issued by SEBI on Board Evaluation which included aspects such as structure and composition of committees, effectiveness of committee meetings, etc.


Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory, cost and secretarial auditors and external consultant(s), including audit of internal financial controls over financial reporting by the statutory auditors and the reviews performed by the Management and the relevant Board Committees, including the Audit Committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during FY 2022-23.

Accordingly, pursuant to Section 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that for the year ended March 31, 2023:

(a) in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis; and

(e) the directors, in the case of a listed Company, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (Rules) are enclosed as Annexure-IV to this report.

AUDITORS Statutory Auditor

The auditors M/s. S N SHAH & Associates., Chartered Accountants offers themselves for reappointment at the ensuing annual general meeting. The company has received a letter from the auditors stating that their appointment if made will be within the limits of Section 139, 141 of the Companies Act, 2013 and the rules made there under. The Directors recommend for their reappointment.

Further, the report of the Statutory Auditors along with notes to Schedules is a part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

Cost Auditors

As per Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to prepare, maintain as well as have the audit of its cost records conducted by a Cost Accountant and accordingly it has made and maintained such cost accounts and records. The Board on the recommendation of the Audit Committee has appointed M/s. Anuj Agrawal & Co. Cost Accountants (Firm Registration No. 100629) as the Cost Auditors of the Company for FY 2023-24 under Section 148 and all other applicable provisions of the Act.

M/s. Anuj Agrawal & Co. have confirmed that they are free from disqualification specified under Section 141(3) and proviso to Section 148(3) read with Section 141(4) of the Act and that the appointment meets the requirements of Section 141(3)(g) of the Act. They have further confirmed their independent status and an arms length relationship with the Company.

The remuneration payable to the Cost Auditors is required to be placed before the Members in a General Meeting for their ratification. Accordingly, a resolution for seeking Members ratification for the remuneration payable to M/s. A.G. Tulsian & Co. is included at Item No. 6 of the Notice convening the AGM.

Secretarial Auditor

In terms of Section 204 of the Act and Rules made there under, M/s. K. Jatin & Co., Practicing Company Secretaries, have been appointed as Secretarial Auditors of the Company to carry out the secretarial audit for FY 2023-23. The report of the Secretarial Auditors for FY 202223 is enclosed as Annexure - V to this Report.

There has been no qualification, reservation, adverse remark or disclaimer given by the Secretarial Auditor in their Report. CORPORATE GOVERNANCE AND COMPLIANCE

The Secretarial and Legal functions of the Company ensure maintenance of good governance within the organisation. They

assist the business in functioning smoothly by being compliant at all times and providing strategic business partnership in the areas including legislative expertise, corporate restructuring, regulatory changes and governance.

We adhere to the principal of Corporate Governance mandated by the Securities and Exchange Board of India (SEBI) and have implemented all the prescribed stipulations. As required by LODR Regulations, 2015, a detailed report on Corporate Governance forms part of this Report as Annexure- VI. The Auditors Certificate on compliance with Corporate Governance requirements by the Company is attached.


The properties of the Company stand adequately insured against risk of fire, strike, riots, earthquake, explosion and malicious damage.


The Company is exposed to the risk from the market fluctuations of foreign exchange as well as the fluctuation in the price of iron and steel. The Companys raw material is old ship, which is purchased from the international market on credit ranging up to 180 days to 360 days. Though the Company is hedging or covering the foreign exchange requirement, the Company is regularly monitoring the foreign exchange movement and suitable remedial measures are taken as and when felt necessary. Though the Company is employing such measures, the Company is still exposed to the risk of any foreign exchange fluctuation.

Likewise, the Companys finished products are mainly re-rollable scrap generated from ship breaking and the price of the same is linked to the market rate for iron and steel. Any ups and downs in the price of the iron and steel will affect the profitability of the Company. The Company keeps a watch on the movement of scrap prices and accordingly decides its policy regarding purchase of ships and sale of scrap.


Except as disclosed elsewhere in this report, there are no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year and the date of this report:


Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Listing Obligation & Disclosure Requirements Regulations, 2015, the Company has framed Risk Management Policy. The details of the policy are as updated on website of the Company www.vmsil.in. The risk management includes identifying types of risks and its assessment, risk handling and monitoring and reporting. At present the Company has not identified any element of risk which may threaten the existence of the Company.


The Company has not developed and implemented any Corporate Social Responsibility initiatives as the said provisions are not applicable.


The Company had 11 (Eleven) Board meetings during the financial year under review. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.


The Audit Committee consists of the following members:


Shri. Bakulbhai Mehta - Chairman


Shri. Ajitkumar Jain - Member


ShriPranav Parikh - Member

The Company has established a vigil mechanism and overseas through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the chairman of the Audit Committee on reporting issues concerning the interests of co employees and the Company.


The Equity shares of the Company are listed on Bombay Stock Exchange. The Company is regular in payment of listing fees. The Company has paid the listing fees for the year 2023-24.


The ISIN for the Equity shares is INE932K01015. As on 31st March, 2023 total 1,64,73,255 equity shares of the Company have been Dematerialized. Members of the Company are requested to dematerialize their shares.


The Directors have devised proper systems and processes for complying with the requirements of applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems were adequate and operating effectively.


Statements in the Directors Report and the Management discussion & Analysis describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include global & domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and its cost, changes in government policies and tax laws, economic development of the country and such other factors which are material to the business operations of the Company.


Your Directors acknowledge with gratitude, the commitment and dedication of the employees, their untiring personal efforts and collective contributions at all levels that has led to the growth and success of the Company. The Directors would also like to thank other stakeholders including banks and business associates who have continued to provide support and encouragement to the Company.

On behalf of the Board of Directors

Date : 11.08.2023

Manojkumar Jain Sangeeta Jain

Place : Ahmedabad

Managing Director Whole Time Director
(DIN: 02190018) (DIN: 00125273)