VST Tillers Tractors Ltd Directors Report.

Dear Members,

Your directors are pleased to present 53rd Annual Report together with the Audited Financial Statements for the Financial Year ended March 31, 2021.


( H in lakhs except EPS)

Particulars Year 2020-21 Year 2019-20
Operating Income 76,424 54,368
Non-Operating Income 4,608 2,358
Total Income 81,032 56,726
Finance Cost 154 147
Depreciation 1,708 1,635
Total Expenses 69,110 54,416
Exceptional Item - -
Profit Before Tax 11,922 2,310
Tax 2,845 510
Profit After Tax 9,077 1,800
Other Comprehensive Income -11 25
Total Comprehensive Income 9,066 1,825
Earning Per Share (Basic and Diluted) 105.06 20.83


During the year under review FY 2021-21, your Company’s Operating income is H 76424 lakhs as against H 54368 lakhs in the previous year FY 2019-20 and the Profit Before Tax (PBT) for the FY 2020-21 is H 11922 lakhs as against H 2310 lakhs in the previous year FY 2019-20. Profit after Tax (PAT) for the FY 2020-21 is H 9077 lakhs as against H 1800 lakhs in the previous year FY 2019-20. With respect to volumes, your Company has done 27318 Nos of tillers against the previous year of 19302 Nos and on tractors, 8835 Nos against previous year of 7147 Nos of tractors.

Despite challenging market conditions, your Company’s Compact Tractor market share stood at 10% and power tiller market share at 54% in FY21.


Due to the volatile nature of the pandemic and its direct impact on the health and safety of people, numerous businesses found themselves in deep waters. The unprecedented spread of novel Covid-19 disrupted lives, livelihoods and communities worldwide. VST as a global company with operation, teams and customers present across the world, we worked together to help our stakeholders, prepare and respond to the pandemic.

VST has faced several critical challenges during the pandemic and One of the key functions affected is the supply chain management. Few other challenges that could seem to be unnoticed, but these are notice and we are all grateful for the efforts of all the VSTians, who had put their optimum efforts to balance and work during this critical situation and for achieving an incredible results for the company. No sector has escaped from the impact of Covid -19 and agriculture being a priority sector the impact is lesser than the other sectors. Company has been always adopting all the Government norms in its manufacturing activities such as social distancing and proper sanitization. For some time due the COVID-19, we have adopted work from home policy also.


Your Company deals with single segment only i.e. "Manufacturing of Agricultural Machineries".


Based on Profits during the FY 2020-21 and continuing the tradition of rewarding the members your Board of Directors recommended a dividend of H 20 /- per equity share of face value of H 10 each i.e. @ 200 %, payable to those members whose names appear in the Register of Members as on the Book Closure / Record Date. The Dividend will be disbursed on or after August 31, 2021, if approved by the members at the 53rd AGM. The total outflow will be H 17.28 Crores


The Board of Directors of your company has decided not to transfer any amount to the Reserves for the year under review.


The Company continues to sustain its commitment to the highest levels of quality. The year under reference, the Company successfully completed the annual ISO surveillance audit and retained the ISO certification for ISO 9001:2015, ISO14001:2015 & ISO 45001:2018


Mr. V P Mahendra (DIN-00033270), retired from the post of Managing Director on close of business hours of February 19, 2021 and he is continuing as Vice Chairman and Non-executive Director w.e.f. February 20, 2021. Mr. V.T. Ravindra (DIN-00396156) has been appointed as Managing Director of the Company w.e.f February 20, 2021.

Ms. Siva Kameswari Vissa (02336249), Independent Director is completing her 1st term of 5 years on July 28, 2021. The Board had recommended the reappointment of Ms. Siva Kameswari Vissa as an Independent Director for 2nd term of 5 years effective from July 29, 2021 and same was approved by members by postal ballot.

Mr. Bijanki Jagannath (DIN-00396161), Independent Director has resigned from Directorship of the Company on June 14, 2021, due to his personal reason. There was no material reason other than those mentioned in the resignation letter. His tenure was expiring on December 26, 2021.

The Board at its meeting held on June 21, 2021 has appointed Dr. Nandakumar Jairam (DIN- 00321693) as an additional independent director w.e.f June 21, 2021, for five years. His appointment as Director of the Company forms part of the 53rd AGM notice.

In the opinion of the Board the Independent Directors possesses integrity, expertise and experience (including the proficiency).

Mr. V.P. Mahendra and Mr. V.V. Pravindra, Directors will retire at the ensuing AGM and they are eligible for reappointment.

Mr. Mahadevan GV, resigned from the post of CFO on June 15, 2020. Mr. Pankaj Khemka, was appointed as CFO & KMP of the company w.e.f November 10, 2020.


The following persons are Key Managerial Personnel (KMP) of the Company under section 203 of the Companies Act, 2013, during the year 2020-21.

1. Mr. V.T. Ravindra - Managing Director

2. Mr. Antony Cherukara - Chief Executive Officer

3. Mr. Pankaj Khemka - Chief Financial Officer

4. Mr. Chinmaya Khatua - Company Secretary


As per Schedule V of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance practices followed by the Company is provided in this Report. A report of the Statutory Auditors of the Company confirming the compliance of conditions of Corporate Governance as required by SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015 is annexed to this report.

Compliance reports in respect of all laws applicable to the

Company have been reviewed by the Board of Directors.


To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013

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

(b) That the directors have selected such accounting policies and applied them consistently and made judgements 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 on March 31, 2021 and of the profit and loss of the company for that period;

(c) That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) That the annual accounts have been prepared on a going concern basis;

(e) That the internal financial controls to be followed by the company have been laid down and that such internal financial controls are adequate and are operating effectively;

(f) That proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems are adequate and operating effectively.

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, the work performed by the internal, statutory and secretarial auditors including the audit of internal financial controls over financial reporting by the Internal Auditors and the reviews performed by management and the relevant board committees, including the audit committee, the Board is of the opinion that the Company’s internal financial controls were adequate and effective during FY 2020-21.


M/s. K.S. Rao & Co, Chartered Accountants (Firm Regn No. 003109S), were appointed as Statutory Auditors of the Company from the financial year 2016-17 at the Annual General Meeting ("AGM") held during 2016 for a term of five financial years commencing from financial year 2016-17 and until financial year 2020-21. Considering the performance and experience of M/s. K.S. Rao & Co a resolution for reappointing M/s. K.S. Rao & Co, Chartered Accountants, as Statutory Auditors, for a second term of five financial years has been proposed by the Board of Directors on the recommendation of the Audit Committee and the said Re-appointment is included in notice of 53rd AGM for the approval of the members.


Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 (as amended), the Board of Directors, on the recommendation of the Audit Committee have appointed M/s. Rao, Murthy & Associates (Firm Registration No- 00065), Practicing Cost Accountant, as the Cost Auditor of the Company for the Financial Year 2021-22. The remuneration payable to the Cost Auditor is subject to ratification of members at the ensuing AGM and same is included in 53rd AGM Notice.

The Company has made and maintained cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013.


M/s. Brahmayya & Co, Chartered Accountant were appointed as Internal Auditors under section 138 of the Companies Act, 2013 for the financial year 2020-21.


Pursuant to the provisions of Section 204 of the Companies Act, 2013 and read with Rules made there under, the Board had appointed Thirupal Gorige & Associates LLP, Practising Company Secretaries to undertake the Secretarial Audit of the Company for the financial year 2020-21. The Secretarial Audit Report is enclosed herewith as Annexure-4.


As required by provisions of section 197 of the Companies Act, 2013 read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The salary details of designated employees are given in Annexure-1.


Information under Section 134 Companies Act, 2013 read with rule 8 (3) of the Companies (Accounts) Rules, 2014 is enclosed as Annexure-2.


Your Company has not accepted any deposits within the meaning of Chapter- V of the Companies Act, 2013 and rules made thereunder.


Industrial relations have been cordial at the Bengaluru,

Mysore, Malur and Hosur plants during the year.

There were 588 of permanent employees on roll as on March 31, 2021.


V.S.T. considers its people as the most valuable assets and upholding their mental and physical health is top priority. V.S.T. is a safe workplace and the Safety & Health of our employees as per the requirement of the Factories Act are ensured. Our motto is "Zero Accident". Our commitment is to protect the environment as per the policy. The Company has been taking all its adequate safety measures for prevention of COVID 19 at all our work locations. The Company has worked tirelessly to extend vaccination drive for all the employees.


Your Company’s operations are supported by a full-fledged Data Centre. Your company has a well-planned Business Continuity Plan Set-up for all critical applications with near real-time data replication.

The delivery centers meet the Information Security Management System and CIA (Confidentiality, Integrity and Availability) Standards. To cater to the ever-changing customer needs, the IT infrastructure is being constantly upgraded with new / enhanced features to facilitate smooth functioning of operations and deliver customer satisfaction. We are using industry best standard mailing solutions with compliance and availability of mails which controls various spam mails.

The Company has fully implemented new ERP system (SAP) during the year 2020-21 to further strengthen the internal control system of the Company. Along with 24*7 availability of critical application and standard business analytical tools. The Company has also implemented many cost saving projects during the year 2020-21.

During the year under review, we fully implemeted SAP, NFA System, created paperless environment, SRM (Supplier Resource Management) and WMS (Warehouse Management system). We have also taken up New DMS (Dealer Management System) which is under implementation and also implemented travel management system.


Six meetings of the Board of Directors were held during the year. For further details, please refer report on Corporate Governance of this Annual Report.


Mr. V.K. Surendra, V.P. Mahendra, Mr. V.V. Pravindra, Mr. V.T. Ravindra and Mr. V S Arun are promoters. Apart from the promoter directors, none of the other Directors are related to each other.


The Company has received declarations from all Independent directors as mentioned in sub-section (6) of section 149 of the Companies Act, 2013, Schedule- IV of the

Act and relevant provision of SEBI (LODR) Regulations 2015.

The online proficiency self-assessment test conducted by Indian Institute of Corporate Affairs, will be undertaken by the Independent Director who is not exempted to do so.


The Company has constituted Audit Committee, Corporate Social Responsibility Committee, Nomination & Remuneration Committee, Stakeholders Relationship Committee and Risk Management Committee. The details of the Committees are mentioned in Corporate Governance Report.


The purpose of this policy is to provide a framework to promote responsible and secure whistle blowing. It is to protect employees wishing to raise a concern about serious irregularities within the Company.

The Company has vigil mechanism cum whistle blower policy to deal with instance of fraud and mismanagement, if any. The details of the vigil mechanism are explained in the Corporate Governance Report and also posted on the website http://www.vsttractors.com/investors/policies of the Company. The Company has not received any complaint during the financial year 2020-21.


There was no qualification, reservation or adverse remark or disclaimer from Statutory & Secretarial Auditors.

There was no fraud reported by the auditors under section 143(12) of the Companies Act, 2013.


The Company has made investment during the financial year 2020-21. The investments details forms part of the notes to the financial statements provided in this Annual Report. The company has not given any Loan or Guarantee during the financial year 2020-21.


All related party transactions that are entered into during the financial year were on an arm’s length basis. There are no materially significant related party transactions made by the company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee and also before the Board for approval.

Prior omnibus approval of the Audit Committee was obtained for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their information and approval. The policy on dealing with Related Party Transactions as approved by the Board can be accessed at http://www.vsttractors. com/investors/policies.

The Related Party Transaction details including the transaction(s) of the Company with a person/entity belonging to the promoter/promoter group which hold(s) more than 10% shareholding in the Company as required pursuant to para A of Schedule V of the SEBI (Listing

Obligations and Disclosure Requirements) Regulations, 2015 forms part of the notes to the financial statements provided in this Annual Report. Please refer the details in Annexure -5 for AOC-2 Form.


There are no material changes and commitments affecting the financial position of the company which have occurred between end of the financial year of the company to which the financial statements relate and the date of the report.


The company has formed Nomination and remuneration committee and the policy is available in the company website i.e. www.vsttractors.com. For more details, please refer Corporate Governance section of the Annual Report


The Company has formulated risk management committee & policy and same is available in Company website. The risk pertaining to business of the Company is discussed at the Risk Management Committee, Audit Committee and at the

Board Meetings on regular basis. For more details, please refer Corporate Governance section of the Annual Report.


The Company has formed CSR policy and Committee details as required by the Act are available in Company website i.e. http://www.vsttractors.com/investors/ policies. The Company has earmarked H 1.93 crores unspent amount for the ongoing projects as approved by the Board. Same will be spent within three financial years.

During the financial year 2021-22 the Company needs to spend H 1.59 crores in CSR Activities. The CSR details forms part of annexure -3 to the Board’s Report. For more details, please refer Corporate Governance section of the Annual Report.


The Board works with the nomination and remuneration committee to lay down the evaluation criteria for the performance of executive/non-executive/independent directors through a peer-evaluation excluding the director being evaluated. The evaluation of Board, Committees and Individual Directors was conducted as per the procedure followed by the Company. The details provided in the Corporate Governance section of the Annual Report.

There is no change in nature of the business during the year.

Details of subsidiary, Associate or joint Venture Company.

The company has no subsidiary company.


There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

The ratio of the remuneration of each Director and KMP to the median remuneration of the employees of the company for the financial year as follows:

Name Designation Remuneration 2020-21 (in J) Remuneration 2019-20 (in J) Increase / Decrease in Remuneration (in J) Increase / Decrease in Remuneration (%) Ratio/Times per Median of employee remuneration
1 *Mr. V.P Mahendra Vice Chairman & Non-Executive Director 98,88,946 88,50,000 10,38,946 11.74 22.7
2 **Mr. V.T. Ravindra Managing Director 65,89,804 63,00,000 2,89,804 4.60 15.14
3 Mr. Antony Cherukara CEO 1,33,72,163 1,13,12,000 20,60,163 18.21 30.74
4 ****Mr. Pankaj Khemka CFO 17,12,667 - - - 3.93
5 Mr. Chinmaya Khatua Company Secretary 19,20,648 19,28,450 -7802 -0.40 4.41
6 Mr. V K Surendra Chairman 3,00,000 8,00,000 -5,00,000 -62.50 0.69
7 Mr. R. Subramanian Director 6,00,000 5,50,000 50000 9 1.38
8 Mr. M.K. Bannerjee Director 10,50,000 11,50,000 -1,00,000 -9 2.41
9 Mr. K M Pai Director 9,50,000 10,50,000 -1,00,000 -9.5 2.18
10 Ms. Siva KameswariVissa Director 6,00,000 4,00,000 2,00,000 50 1.38
11 Mr. B. Jagannath Director 3,50,000 2,50,000 1,00,000 40 0.80
12 Mr. V V Pravindra Director 1,50,000 3,50,000 -2,00,000 -57 0.34
13 Mr. V S Arun Director 1,00,000 2,00,000 -1,00,000 -50 0.23
14 *V P Mahendra Director 1,00,000 - - - 0.22
15 Mr. Mahadevan GV# CFO 17,32,862 37,54,952 -20,22,090 -117% 4


* Mr. V P Mahendra retired from the post of Managing Director on close on business hour of February 19, 2021 and he is continuing as Vice Chairman and Non-executive Director w.e.f. February 20, 2021. The sitting fees of H 100,000 was paid to Mr. V.P. Mahendra as non-executive Director of the company. **Mr. V.T.Ravindra appointed as Managing Director w.e.f. February 20, 2021.

*** Mr. Pankaj Khemka appointed as CFO of the Company w.e.f November 10, 2020.

#Mr. Mahadevan GV resigned from the post of CFO on June 15, 2020.

The Company’s PAT has increased from H 1800 lakhs to H 9077 lakhs. The increase in KMP remuneration is in line with the current market scenario and with Company’s policy. However, salary of Managing Director was approved by the shareholders.

The Company has given about 6% average increase in salaries to the employees keeping in view the overall industry standard and interest of the employees. The unionized employees of the Company are eligible for salary increment as per the terms and conditions of their wage settlement. There is no exceptional circumstances of increase in the managerial remuneration.

The Company has 588 Nos permanent employees on roll as on March 31, 2021. The Company fixes salary of the employees on the basis of Remuneration Policy of the Company. The average increase in median remuneration of employees during the year 2020-21 is about 5%. Payment of Commission to Managing Director and Whole time Director - The Managing Director and whole time director are being paid commission on net profit of the Company as approved by the Members.

Name Designation Commission
Mr. V.P. Mahendra Vice Chairman (retired from the post of Managing Director on February 19, 2021 and he is continuing as Vice Chairman & Non- executive Director w.e.f February 20, 2021) One percent on the net profit of the Company subject to a maximum of one and half times of annual basic salary drawn (upto the tenure of Managing Director)
Mr. V T Ravindra Managing Director (Previously appointed as Executive Director and w.e.f February 20, 2021 appointed as Managing Director). One percent on the net profit of the Company subject to a maximum of one and half times of annual basic salary drawn

Mr Antony Cherukara, CEO received remuneration in excess of the highest paid director during the year considering his salary for the full year, the details are given in Page No. 37.


Date Paid up Capital (in J) Closing Market Price per shares EPS PE Ratio Market Capitalisation (J in crore)
31.03.2020 86395280 672.05 20.83 32.26 580
31.03.2021 86395280 1782.45 105.06 16.96 15400
Increase/Decrease NIL 1110.4 84.23 -12.3 14820
% Increase/Decrease NIL 165 404 -38 2555
No of issue of shares during the year - - - - -

Data Source: BSE Ltd.

Internal Complaint Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has formed Internal Complaint Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and no complaint was received during the financial year 2020-21.


No disclosure or reporting is required with respect to the following items, as there were no transactions or not applicable during the year under review:

• The issue of equity shares with differential rights as to dividend, voting or otherwise.

• The issue of shares to the employees of the company under any scheme (sweat equity or stock options). There is no change in the Share Capital Structure during the year under review.

• The company does not have any scheme or provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees.

- Redemption of shares/debentures

- Application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016

(31 of 2016) during the year alongwith their status as at the end of the financial year.

- The details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.]

Annual Return

Annual Return of the Company is available in Company website i.e. www.vsttractors.com.

Secretarial Standards

The mandatory Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) have been duly complied by the Company.

Investor Education and Protection Fund

Company has transferred H714501 unpaid and unclaimed dividend to Investor Education and Protection Fund and 5179 Nos of shares to IEPF Authority as per IEPF Rules. As per said rule, any benefits such as dividend shall be transferred to IEPF with respect to shares transferred to IEPF and accordingly dividend of the corresponding shares transferred to IEPF, has also been transferred to IEPF. The details of such Dividends and shares are available in Company website at www.vsttractors.com. Mr. Chinmaya Khatua has been appointed as nodal officer under IEPF Rule.

The details of unclaimed dividends as on 31/03/2021 is given below:

Financial Year Unclaimed Dividend Amount (in J) No of corresponding Shares Due date of Transfer to IEPF
1 2013-14 1122030 74802 15/09/2021
2 2014-15 1012860 67524 11/09/2022
3 2015-16(Interim) 999645 66643 28/04/2023
4 2016-17 1045485 69699 11/09/2024
5 2017-18 2258750 45175 11/09/2025
6 2018-19 643815 42921 12/09/2026
7 2019-20(Interim) 659955 43997 17/04/2027

Details of Nodal officer:

Name- Mr. Chinmaya Khatua, Company Secretary Email- investors@vsttractors.com Phone No- 080-67141111

The above details are available in Company website: www.vsttractors.com


Your directors thank all customers’ for their continued support and patronage. The Directors also thank the Company’s Bankers, Selling Agents, Vendors, Central and State Governments for their valuable assistance.

The Directors wish to place on record their appreciation for the cooperation and contribution made by the employees at all levels towards the progress of the Company.

Place: Bengaluru V. K.Surendra
Date: 21/06/2021 Chairman