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Directors Report of Patels Airtemp (India) Ltd.
Mar 31, 2024
The Directors have pleasure in presenting herewith the 32nd Annual Report 2023-24 together with the Audited Standalone & Consolidated Financial Statements of Patels Airtemp (India) Limited (herein after referred to as "the Company") for the year ended 31st March, 2024.
FINANCIAL RESULTS (STANDALONE)
|
(Rs. in Lakhs except EPS) |
||
|
Particulars |
Year ended 31-03-2024 |
Year ended 31-03-2023 |
|
Revenue from Operations |
37076.17 |
28147.85 |
|
Other Income |
198.94 |
132.56 |
|
Total Income |
37275.11 |
28280.41 |
|
Less: Depreciation & Amortisation Expenses |
406.39 |
410.83 |
|
Finance Cost |
1286.27 |
1204,84 |
|
Other Expenses |
33568.34 |
25128.94 |
|
Total Expenses |
35261.00 |
26744.61 |
|
Profit before Tax |
2014.11 |
1535.80 |
|
Less :Tax Expenses |
544.66 |
416.99 |
|
Net Profit for the year |
1469.45 |
1118.81 |
|
Balance brought forward from previous year |
10735.91 |
9759.06 |
|
Profit available for Appropriation |
12205.36 |
10877.87 |
|
Less: Proposed Dividend |
164.11 |
141.97 |
|
Less: Tax on Dividend |
-- |
-- |
|
Less Transfer to General Reserve |
-- |
-- |
|
Surplus carried forward to Balance Sheet |
12041.24 |
10735.91 |
|
Other Comprehensive Income / (Loss) for the Year |
4.93 |
(6.31) |
|
Total Comprehensive Income for the year |
1474.38 |
1112.50 |
|
Earnings Per Share of '' 10/- each ('' ) |
26.86 |
21.44 |
STATE OF COMPANY''S AFFAIRS (STANDALONE)
The Company has earned total revenue from operations of '' 37076.17 Lakhs during the year ended on 31st March, 2024 as against '' 28147.85 Lakhs earned during the previous year ended on 31st March, 2023, an increase of 31.72 %. The Company has also earned other income of '' 198.94 Lakhs during the year under review as against '' 132.56 Lakhs earned during the previous year.
Out of revenue from operations of '' 37076.17 Lakhs earned by the Company during the year under review, '' 36597.61 Lakhs represents sale of products (Domestic & Export), '' 72.01 Lakhs represents sale of Services (Processing Charges) and '' 406.55 Lakhs represents other operating revenue including export incentives.
The Company has incurred total expenses of '' 35261.00 Lakhs during the year ended on 31st March, 2024 as compared to '' 26744.61 Lakhs incurred during the previous year ended on 31st March, 2023.
The Company has paid total fees of '' 4,38,000 including statutory audit fees, certification fees and fees for other services to M/s. Parikh & Majmudar (Firm Registration No. 107525W & Membership No. 107628), Chartered Accountants, Ahmedabad, the Statutory Auditors of the Company.
The company has written off Investment in Wholly Owned Subsidiary amounting to '' 7.17 Lakhs and Loan to Wholly Owned Subsidiary amounting to '' 5.32 Lakhs in the books of accounts due to dissolution of M/s. Patels Airtemp (USA) Inc., a Wholly Owned Subsidiary (WOS/Foreign Entity) of the Company w.e.f. 11th December, 2023.
The Company has earned the Profit before Tax of '' 2014.11 Lakhs during the year ended on 31st March, 2024 as compared to '' 1535.80 Lakhs earned during the previous year ended on 31st March, 2023, an increase of 31.14 %.
The Company has earned Net Profit of '' 1469.45 Lakhs for the year ended on 31st March, 2024 after making Provision for Tax Expenses of '' 544.66 Lakhs and other adjustments, as compared to Net Profit of '' 1118.81 Lakhs earned by the Company during the previous year ended on 31st March, 2023, an increase of 31.34 %.
After adding the Surplus in the Statement of Profit & Loss of '' 10735.91 Lakhs brought forward from the previous year to the profit of '' 1469.45 Lakhs earned by the Company during the year under review, the total amount of '' 12205.36 Lakhs is available for appropriation.
After appropriating the Dividend amount of '' 164.11 lacs, as recommended, out of '' 12205.36 Lakhs available for appropriation, the balance amount of '' 12041.24 Lakhs carried forward to Balance Sheet.
The Audited Standalone Financial Statements of the Company and all other documents required to be attached thereto have been included in the Annual Report 2023-24, which has been put on the Company''s website https://patelsairtemp.com/investors/annual-reports/
DIVIDEND
The Directors have recommended dividend of '' 3.00 per share (@ 30 %) on increased share capital of 54,70,240 Equity Shares of '' 10/- each of the Company out of the profits of the Company for the Financial Year ended 31st March, 2024 (2023-24), as compared to Dividend of '' 3.00 per share (@ 30 %) declared on 54,70,240 Equity Shares of '' 10/- each for the previous Financial Year ended 31st March, 2023. This will absorb '' 164.11 lakhs.
A resolution to that effect has been placed for the approval of the members at this Annual General Meeting of the Company and that the same, when declared, shall be paid to the Members within 30 days from the date of declaration.
Pursuant to Finance Act, 2020, dividend income will be taxable in the hands of the shareholders w.e.f. 1st April 2020 and the Company is required to deduct tax at source ("TDS") from dividend paid to the Members at prescribed rates, subject to the provisions of Income Tax Act, 1961. In this regard, the details of provisions regarding TDS on dividend amount have already been mailed to the shareholders earlier and have also been included in the Notes to the Notice of AGM included in this Annual Report.
TRANSFER TO RESERVE
In view of above, the Company has not transferred any amount to the General Reserve for the year ended on 31st March, 2024 and retain the entire amount of profits in the Profit & Loss Account.
DISSOLUTION OF WHOLLY-OWNED SUBSIDIARY (WOS/FOREIGN ENTITY) (OVERSEAS SUBSIDIARY)
Patels Airtemp (USA) Inc., a Corporation, was formed in the State of Delaware, USA. The Company acquired 10,00,000 Shares with a par value of USD 0.01 per Share of Patels Airtemp (USA) Inc. (Equity Investment), to become 100 % Wholly Owned Subsidiary (WOS) of Patels Airtemp (India) Ltd. with effect from 13th January, 2020.
However, the aforesaid Patels Airtemp (USA) Inc., Wholly Owned Subsidiary (WOS) of the Company was dissolved w.e.f. 11th December, 2023, as per Certificate of Dissolution issued by State of Delaware (USA), as the said WOS did not commence any business activities since its incorporation and incurred loss and there was no plan to commence any business activities in future. The said WOS was dissolved by disinvestment of Equity Capital and write off USD 15,941 and net balance of USD 9,059 remitted to India from USA, pursuant to the provisions of Foreign Exchange Management Overseas Investment Rules, Regulations and Directions issued by the Central Government along with Reserve Bank of India (RBI) and also the laws applicable in the State of Delaware, USA.
Consequent upon the said dissolution, Patels Airtemp [USA) Inc., ceased to be the subsidiary of the Company w.e.f. 11th December, 2023. Patels Airtemp (USA) Inc., was not a Material Subsidiary of the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to the requirements of Section 129(3) read with Schedule III of the Companies Act, 2013 and Rules made thereunder and as stipulated by Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (herein after referred to as "SEBI Listing Regulations") and applicable Indian Accounting Standards, the Consolidated Financial Statements of the Company and its Wholly Owned Subsidiary (WOS/Foreign Entity) namely Patels Airtemp (USA) Inc. for the year ended 31st March, 2024 have been attached with the Financial Statements of the Company. The Audited Consolidated Financial Statements together with Auditors'' Report form part of the Annual Report 2023-24. The Consolidated Financial Statements comprise of Audited Financial Statements of the Company and Patels Airtemp (USA) Inc.
During the year under review, M/s. Patels Airtemp (USA) Inc., a Wholly Owned Subsidiary (WOS/Foreign Entity) of the Company, stands dissolved w.e.f. 11th December, 2023 as per Certificate of Dissolution issued by State of Delaware (USA). In this regard, the Consolidated Financial Statements for the year ended on 31st March, 2024 comprises of Audited Financial Statements of the Company for the year ended 31st March, 2024 and Audited Financial Statements of Patels Airtemp (USA) Inc. up to 30th November, 2023.
During the year under review, there were no significant transactions and arrangements entered into by the said Wholly Owned Subsidiary of the Company. Audit Committee and Board of Directors of the Company reviewed quarterly unaudited financial results / statements of the said Wholly Owned Subsidiary. The Company monitored performance of its Wholly Owned Subsidiary, inter alia, by the Minutes of Board Meetings and General Meeting of the said Wholly Owned Subsidiary placed before the Board of Directors of the Company.
As on March 31,2024, the Company did not have any material unlisted subsidiary as defined in Regulation 16(1)(c) of SEBI Listing Regulations. Accordingly, the requirement of appointment of Independent Director of the Company on the Board of Directors of the material unlisted subsidiary companies as per Regulation 24 of SEBI Listing Regulations does not apply.
The Company has formulated a Policy for determining Material Subsidiaries. The Policy is put up on the Company''s website and can be accessed at https://www.patelsairtemp.com/pdf/policies-and-code-of-conduct/policy-on-material-subsidiaries.pdf.
In accordance with the provisions of Section 136 of the Act and the amendments thereto, read with the SEBI Listing Regulations, the Audited Consolidated Financial Statements of the Company and all other documents required to be attached thereto have been included in the Annual Report 2023-24, which has been put on the Company''s website https://www.patelsairtemp.com/investors/annual-reports/
The Audited Financial Statements of the Wholly Owned Subsidiary (WOS/Foreign Entity) for the period up to 30th November, 2023, as required, are also put up on the Company''s website and can be accessed at https://www.patelsairtemp.com/investors/subsidiarv-companv-accounts/ These documents will also be available for inspection on all working days, except Saturdays, during business hours, at the Company''s Factory (Works) at Rakanpur, Dist. Gandhinagar.
A statement containing the salient features of the financial statements of the Company''s Wholly-Owned Subsidiary (WOS/Foreign Entity) for the year ended 31st March, 2024 in the prescribed Form AOC-1 as per first proviso to sub-section (3) of Section 129 of the Companies Act, 2013 and Rule 5 of the Companies (Accounts) Rules, 2014 is attached herewith as per Annexure - A and forms an integral part of this Report.
The Company has already filed an Annual Performance Report (APR) in Form ODI Part II with the Reserve Bank of India for the period up to 30th November, 2023 for its Overseas Direct Investment (ODI) in its Wholly Owned Subsidiary (WOS) Patels Airtemp (USA) Inc.
The Company has also filed an Annual Return on Foreign Liabilities and Assets (FLA) for the year 2023-24 (as on 31st March, 2024) with Reserve Bank of India.
EXPANSION UNDER NEW GREENFIELD PROJECT (DUDHAI UNIT)
In respect of new Greenfield project set up by the Company in the year 2019-20 at Dudhai, Taluka. Kadi, Dist. Mehsana, Gujarat (Dudhai Unit), the Company has constructed total four bays/shades with total covered area of 11,016 Sq. Mtrs., with total capital outlay of around '' 24.00 crores. In this regard, during the financial year 2023-24, the Company has further incurred additional capital expenditure to the extent of '' 86.26 Lacs for the said project mainly in Plant & Machinery and Factory Road.
FUTURE PROSPECTS
As you aware that the Company is in engineering industry and is engaged in manufacturing/fabricating tailor made machines and therefore, the order book position of such type of company can play pivotal role in the growth of the Company. Your Directors are pleased to state that continuing the past trend, the Company is having confirmed orders of about '' 312 Crores on hand as on 151 August, 2024. Thus, your Directors are quite bullish on repeating similar performance in future. Your Directors are cautious and making untiring efforts so as not to compromise on growth, quality, and profitability of the Company.
MATERIAL EVENTS DURING THE YEAR
SHRI NARAYANBHAI G. PATEL, CHAIRMAN & WHOLE-TIME DIRECTOR
During the year, Shri Narayanbhai G. Patel, the Founder and one of the Promoter and Chairman & Whole-time Director of the Company, died on 3rd October, 2023 due to illness. Unexpected demise of Shri Narayanbhai G. Patel will be irreparable loss to the Company and all Directors and Employees of the Company convey deep sympathy, sorrow and condolences to his family members. In absence of Shri Narayanbhai G. Patel, highly experienced Board of Directors and Senior Management of the Company are committed to take legacy of Shri Narayanbhai G. Patel and release his vision for the Company.
PATELS AIRTEMP (USA) INC., WHOLLY OWNED SUBSIDIARY (WOS)
Patels Airtemp (USA) Inc., Wholly Owned Subsidiary (WOS) of the Company was dissolved w.e.f. 11th December, 2023 as per Certificate of Dissolution issued by State of Delaware (USA). The said WOS was dissolved by disinvestment of Equity Capital and write off USD 15,941 and net balance of USD 9,059 remitted to India from USA, pursuant to the provisions of Foreign Exchange Management Overseas Investment Rules, Regulations and Directions issued by the Central Government along with Reserve Bank of India (RBI) and also the laws applicable in the State of Delaware, USA.
Consequent upon the said dissolution, Patels Airtemp [USA) Inc., ceased to be the subsidiary of the Company w.e.f. 11th December, 2023. Patels Airtemp (USA) Inc., was not a Material Subsidiary of the Company.
MATERIAL CHANGES AND COMMITMENTS
In terms of Section 134(3)(l) of the Companies Act, 2013, except as mentioned above, no material changes or commitments affecting the financial position of the Company have occurred between the end of the financial year and the date of this Report.
There has been no change in the nature of business of the Company.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE
PREFERENTIAL ISSUE OF SHARES
Regarding Interlocutory Application (IA) No. IA/69(AHM)2022 in No. IA/68(AHM)2022 read with Company Petition (CP) No. 58/(AHM)2018 filed by one Mr. Bhavesh D. Narumalani (Applicant) vs. Therm Flow Engineers Private Limited (Respondent) with National Company Law Tribunal (NCTL), Ahmedabad Bench, with regards to approval of the Shareholders received at the Extraordinary General Meeting ("EGM") of the members of the company held on 8th October, 2022 for the Preferential Issue of 4,00,000 Equity Shares of face value of '' 10/- each of the Company for cash at a premium of '' 222/- per share aggregating to '' 9,28,00,000/- issued and allotted to the Promoters and Promoter Group on 16th November, 2022, the Company has so far not received any directives from the Hon''ble NCLT in the said matter as on the date of this Report.
Meanwhile, the Company has already received listing and trading approval from BSE Ltd. vide its letter No. LOD/PREF/TP/CP/13646/2022-23, dated 1st December, 2022 for trading of 4,00,000 Equity Shares of '' 10/-each effective from 2nd December, 2022.
SEBI SETTLEMENT PROCEEDINGS
During the financial year 2023-24, the Company has applied for settlement under the settlement scheme pursuant to the provisions of SEBI (Settlement Proceedings) Regulations, 2018 as amended in the matter of Show Cause Notice No. SEBI/HO/EAD-8/SKV/VC/36027/2023 Dated September 01, 2023 (SCN) issued by SEBI against the Company in the matter of Extra-ordinary General Meeting (EGM) of the Company held on 8th October, 2022 and disclosures made in Explanatory Statement for Shares issued and allotted to the Promoters and Promoter Group under Preferential Issue made by the Company. Pursuant to the said Settlement Application, the Company is awaiting for approval / order from SEBI regarding the settlement terms, subject to other legal course of action available to the Company.
Except above, the Company has not received any significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company''s operations in future.
ANNUAL RETURN
Annual Return of the Company as on 31st March, 2024 as required under Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013 in the prescribed Form MGT-7 is put up on the Company''s website and can be accessed at https://patelsairtemp.com/investors/annual-return/
MANAGEMENT DISCUSSION AND ANALYSIS (MDA)
In terms of provisions of Regulation 34 of SEBI Listing Regulations, the Management Discussion and Analysis Report has been enclosed herewith as per Annexure - B and forming part of the Directors'' Report.
RECOGNITION OR AWARDS
Along with development of product design and product manufacturing application, the Company in its tenure of 51 years continuously upgraded quality and product system by acquiring world''s most recognized system like ISO 9001:2015, ISO 14001:2015, ISO 45001:2018 and ASME (U2, U, S-Stamps).
The Company is having Quality Management System as per ISO 9001-2015 certification from TUV-SUD and Certificate for Environment Management System as per ISO 14001:2015 and Occupational Health and Safety (OH&S) Management System as per ISO 45001:2018 from TUV-NORD.
The Company''s products have ASME (American Society of Mechanical Engineers-USA) "U", "U2" and "S" Stamp authorization. The Company is also having "NB" and "R" Stamp. The Company is also a member of HTRI (Heat Transfer Research, Inc, U.S.A.) for updating Heat Transfer Technology.
Due to "U"/ "U2"/ "S" Stamp authorization, it is expected to improve the Quality of the products/equipment of the Company and to achieve higher growth and profitability of the Company in future.
The Company has also licensed software of ANSYS, CREO, PVelite, Nozzle Pro and TEKLA for product development.
FINANCE
The Company is availing working capital facilities of '' 180.92 Crores from Bank of Baroda and '' 68.25 Crores from Axis Bank Ltd. aggregating to '' 249.17 Crores under consortium arrangement.
During the year 2023-24, the Company has also availed additional SBLC limit of '' 5.00 Crores, being sub-limit of Bank Guarantee, within overall working capital facilities of '' 68.25 Crores sanctioned by Axis Bank Ltd.
The Company is also availing L.C. Bill Discounting facility amounting to '' 10.00 Crores from Axis Bank Ltd.
The Company is also availing Bill Discounting facility from Citibank NA.
The Company is also availing overdraft facility against fixed deposit with various branches of Bank of Baroda. ACCEPTANCE OF DEPOSITS
During the year under review, the Company has not accepted any deposits from the Public and Members of the Company and therefore not required to comply with the requirement under the Companies Act, 2013 and the Rules made thereunder. As such, no amount of principal or interest was outstanding to the Public and Members of the Company as on March 31, 2024 and the Company is not required to furnish information in respect of outstanding deposits under Non-banking, Non-financial Companies (Reserve Bank) Directions, 1966 and Companies (Accounts) Rules, 2014.
During the year under review, the Company has accepted deposits from the Directors of the Company which are exempted deposits under Rule 2(1)(c)(viii) of Companies (Acceptance of Deposits) Rules, 2014, subject to compliance of the provisions of the Companies Act, 2013 and the Rules made thereunder.
During the year under review, the Relatives of the Directors also brought in unsecured loan/deposits by way of contribution to bring additional long term funds as a part of conditions imposed by Bank of Baroda on the Promoters and their relatives, while reviewing working capital facilities to the Company vide its Letter No. AR/SMEBR/2021-22/July, 94 dated 7th August, 2021, which are exempted deposits under Rule 2(1)(c) (xiii) of Companies (Acceptance of Deposits) Rules, 2014.
Details of exempted deposits accepted and repaid by the Company including interest to the Directors & their Relatives during the financial year 2023-24 are mentioned in Note No. 17 and 33 (Relate Party information) of the Notes to the Standalone Financial Statements attached with this Annual Report.
The Company has duly filed the required Form DPT-3 during the year under review regarding exempted deposits under MCA portal.
TRANSFER OF UNCLAIMED DIVIDEND TO IEPF
In terms of the provisions of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (IEPF), as amended, during the year under review, the Company has transferred the amount of unclaimed/unpaid Dividend of '' 2,25,299.80/- for the financial year 2015-16 to IEPF established by the Central Government under Section 124 & 125 of the Companies Act, 2013 and Rules made thereunder.
Pursuant to provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid / unclaimed amounts lying with the Company as on 23rd September, 2023 (date of the previous Annual General Meeting) on the Company''s website: https://www.patelsairtemp.com/investors/ unclaimed-dividend/
TRANSFER OF SHARES TO IEPF DEMAT AUTHORITY ACCOUNT
Pursuant to the provisions of Section 124 and 125 of the Companies Act, 2013 and Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, the Company has, during financial year 2023-24, transferred to the IEPF Authority 3,667 Equity Shares of the face value of '' 10/- each belonging to 41 Shareholders in respect of which dividend had remained unpaid or unclaimed for seven consecutive years or more from 2015-16 to 2021-22. Details of shares transferred to the IEPF Authority are available on the website of the Company https://www.patelsairtemp.com/investors/ iepf-shares-transfer/
The said details have also been uploaded on the website of the IEPF Authority and the same can be accessed through the link: www.iepf.gov.in. In accordance with the said IEPF Rules and its amendments, the Company had sent notices to all the Shareholders whose shares were due to be transferred to the IEPF Authority and simultaneously published newspaper advertisement. The voting rights on the shares transferred to IEPF Authority shall remain frozen till the rightful owner claims the shares.
Members may note that the dividend and shares transferred to the IEPF can be claimed back by the concerned shareholders from the IEPF Authority after complying with the procedure prescribed under the Rules.
The Company has duly appointed Company Secretary of the Company as Nodal Officer for the purposes of verification of claims and coordination with Investor Education and Protection Fund Authority.
The Company has duly filed all the required IEPF Forms with the authorities.
CORPORATE GOVERNANCE
Being a Listed Company, the Company has taken necessary measures to comply with the provisions of SEBI Listing Regulations regarding Corporate Governance as amended from time to time. A separate report on Corporate Governance for the year ended 31st March, 2024 is attached herewith as a part of this Annual Report viz Annexure - C. A certificate from Practicing Company Secretary of the Company regarding compliance of the aforesaid provisions of Corporate Governance is obtained by the Company and annexed to the Corporate Governance Report. The Certificate on Corporate Governance issued by Practicing Company Secretary for the financial year 2023-24 does not contain any qualification, reservation or adverse remark in respect of Corporate Governance Report.
The Company has furnished to BSE Ltd., where the Shares of the Company are listed, Corporate Governance Compliance Report for the Quarter/Half-year/Whole year during the financial year 2023-24 in the format as specified by SEBI from time to time as placed before the Board as per various provisions of SEBI Listing Regulations. The said Corporate Governance Compliance Report have also been uploaded on the website of the of the Company https://www.patelsairtemp.com/investors/corporate-governance-report/.
DIRECTORS'' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the confirmation and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(C) and 134(5) of the Companies Act, 2013 and confirm that:
(a) i n the preparation of the annual accounts for the year ended 31st March, 2024, the applicable accounting standards read with requirements set out under Schedule III to the Act have been followed and there are no material departures from the same;
(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2024 and of the profit of the Company for the year ended on that date;
(c) the Directors have taken proper and sufficient 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 have prepared the annual accounts for the year ended on 31st March, 2024 on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls 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 were adequate and operating effectively.
PARTICULARS OF LOAN GIVEN AND INVESTMENT MADE
During the year under review, the Company has not provided any loan or guarantee or security to any person nor made any investment.
Particulars of earlier loan given and investment made by the Company in its Wholly Owned Subsidiary (WOS), namely, Patels Airtemp (USA) Inc. are provided in the Standalone Financial Statements of the Company (Please refer Note No. 4, 5 and 40 to the Standalone Financial Statements).
However, during the year ended on 31st March, 2024, the company has written off Investment in Wholly Owned Subsidiary amounting to '' 7.17 Lakhs and Loan to Wholly Owned Subsidiary amounting to '' 5.32 Lakhs in the books of accounts due to dissolution of M/s. Patels Airtemp (USA) Inc., a Wholly Owned Subsidiary (WOS/Foreign Entity) of the Company w.e.f. 11th December, 2023 as per Certificate of Dissolution issued by State of Delaware (USA).
RELATED PARTY TRANSACTIONS (RPTs)
Information on transactions with related parties referred to under sub-section (1) of Section 188 of the Companies Act, 2013 in the prescribed Form AOC-2 is attached herewith viz Annexure - D and forming part of the Directors'' Report pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014.
Pursuant to the provisions of SEBI Listing Regulations, details of related party transactions entered into by the Company, in terms of Ind AS-24 have been disclosed in Note No. 33 of the Notes to the Standalone Financial Statements for the year ended 31st March, 2024, forming part of this Report.
However, there are no materially significant related party transactions made/entered into by the Company with its related parties including promoters, directors or the management etc. that may have potential conflict with the interests of the Company at large.
"Policy on Materiality of Related Party Transactions and Dealing with Related Party Transactions" related to entering into Related Party Transactions by the Company with Related Parties is uploaded on the Company''s website viz. https://www.patelsairtemp.com/pdf/policies-and-code-of-conduct/policy-on-materiality-of-related-partv-transaction-and-dealing-with-related-partv-transactions.pdf.
SEBI (Listing Obligations and Disclosure Requirements) (Sixth Amendment) Regulations, 2021 pertaining to Related Party, Related Party Transactions, Prior Approvals and Disclosures effective from April 01, 2022 and other earlier amendments, except for a few provisions which will be effective from April 01, 2023, have introduced substantial changes in the RPT framework. In view of the said amendments, policy on materiality of related party transactions and dealing with related party transactions of the Company (Policy on RPTs) was modified / revised / updated in line of the above amendments which is effective from 12th November, 2022.
All Related Party Transactions are placed before the Audit Committee for its prior approval (by Independent Directors only from 1st January, 2022 as per amendment in SEBI Listing Regulations) as also to the Board for approval including Omnibus approval for the transactions for one financial year, which are repetitive in nature and also for the transactions, which are not foreseen (subject to financial limit). However, the Company has not entered into any contract/ arrangement / transaction with related parties which could be considered material in accordance with the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder and SEBI Listing Regulations and as such no approval of the Shareholders require.
As per Regulation 23 and 18(3) read with Part C of Schedule II of SEBI Listing Regulations as amended from time to time, the Audit Committee of the Board has reviewed and ratified Related Party Transactions (RPTs) entered into by the company with related parties during the financial year ended 31st March, 2024 (202324) pursuant to each of the omnibus approvals given.
The Company has duly filed with BSE Ltd. half-yearly statement of Related Party Transactions ended on 31st March, 2023 and 30th September, 2023 in accordance with applicable Indian Accounting Standards on a consolidated basis in the format as specified by SEBI from time to time pursuant to Regulation 23(9) of SEBI Listing Regulations and uploaded the said details on website of the Company viz. https://www. patelsairtemp.com/investors/disclosures-of-related-party-transactions/
SECRETARIAL STANDARDS
The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ''Meetings of the Board of Directors'' and ''General Meetings'' respectively, issued by the Institute of Company Secretaries of India (ICSI) have been duly followed by the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
With profound sorrowfully, the Board of Directors of the Company express their deep condolences at the sad demise of Shri Narayanbhai G. Patel (DIN: 00023107), the Founder, one of the Promoter and the Chairman & Whole-time Director of the Company on 3rd October, 2023 due to ill-health. Unexpected demise of Shri Narayanbhai G. Patel will be irreparable loss to the Company and all Directors and Employees of the Company convey deep sympathy, sorrow and condolences to his family members. Due to sad demise, Shri Narayanbhai G. Patel ceased to be a Chairman & Whole-time Director and Member of the Audit Committee (AC), Nomination & Remuneration Committee (NRC), Stakeholders'' Relationship Committee (SRC) and Corporate Social Responsibility Committee (CSR) committee of Board of Directors of the Company. In absence of Shri Narayanbhai G. Patel, highly experienced Board of Directors and senior management of the Company are committed to take legacy of Mr. Narayanbhai G. Patel and release his vision for the Company. However, before his demise, Shri Narayanbhai G. Patel (DIN: 00023107) was duly re-appointed as Wholetime Director of the Company designated as "Chairman & Whole-time Director" for a further period of 3 years with effect from 20th May, 2023 up to 19th May, 2026, with payment of remuneration by way of Salary of '' 4,00,000/- per month plus perquisites and allowances, as recommended and approved by Nomination & Remuneration Committee and Board of Directors and duly approved by the Shareholders by passing Special Resolution at the 31st Annual General Meeting (AGM) held on 23rd September, 2023.
Mr. Sanjivkumar N. Patel (DIN:02794095) has been duly re-appointed as Managing Director of the Company for a further period of 3 years with effect from 20th May, 2023 up to 19th May, 2026, with payment of remuneration by way of Salary of '' 4,00,000/- per month plus perquisites and allowances, as recommended and approved by Nomination & Remuneration Committee and Board of Directors and duly approved by the Shareholders by passing Special Resolution at the 31st Annual General Meeting (AGM) held on 23rd September, 2023. Meanwhile, Mr. Sanjivkumar N. Patel, Managing Director (DIN: 02794095), has been appointed as the Chairman of the Board of Directors of the Company designated as "Chairman & Managing Director" with effect from 9th November, 2023 and to remain the Chairman of the Board until otherwise decided by the Board of Directors in place of Shri Narayanbhai G. Patel (DIN: 00023107) who ceased to be the Chairman & Whole-time Director of the Company w.e.f. 3rd October, 2023 due to his sad demise.
Pursuant to the provisions of the Companies Act, 2013 and Rules made thereunder and Articles of Association, Mr. Apurva V. Shah (DIN: 0008197983), Whole-time Director of the Company, shall retire by
rotation as Director of the Company at this Annual General Meeting, and being eligible, offers himself for re-appointment, for which necessary resolution has been incorporated in the notice of the meeting. The Board of Directors recommends re-appointment of Mr. Apurva V. Shah (DIN: 0008197983) as Director of the Company. Meanwhile, Mr. Apurva V. Shah has been re-appointed as a Whole-time Director of the Company for a further period of 3 (Three) years with effect from 11th August, 2024 up to 10th August, 2027, upon the terms and conditions including remuneration by way of Salary of '' 3,60,000/- per month plus Perquisites and Allowances for the said period of 3 years from 11th August, 2024 up to 10th August, 2027 as recommended and approved by Nomination & Remuneration Committee and Board of Directors and duly approved by the Shareholders by passing an Ordinary Resolution through Postal Ballot of the Company. The brief resume/details relating to Mr. Apurva V. Shah, who is to be re-appointed are furnished in the Notes to the Notice of the Annual General Meeting.
The second term of Mr. Hareshkumar I. Shah (DIN: 00216585) as Independent Director of the Company, shall be completed on 29th August, 2024 and accordingly he will cease to be an Independent Director of the Company. Consequently. Mr. Hareshkumar I. Shah will also cease to be a Chairman of Audit Committee (AC), Nomination & Remuneration Committee (NRC), Stakeholders Relationship Committee (SRC) and Corporate Social Responsibility (CSR) Committee of the Board w.e.f. 30th August, 2024. The Board places on record their appreciation for the assistance and guidance provided by Mr. Hareshkumar I. Shah during his tenure as an Independent Director of the Company and also as a Chairman of AC, NRC, SRC & CSR Committees of the Board.
Mr. Rajendrakumar C. Patel (DIN: 06532676) has been duly re-appointed as Independent Director (Nonexecutive & Independent) of the Company not liable to retire by rotation, for a second term of five years from 10th August, 2024 up to 9th August, 2029 as recommended and approved by Nomination & Remuneration Committee and Board of Directors and duly approved by the Shareholders by passing Special Resolution through Postal Ballot.
COMMITTEES OF DIRECTORS
The Board of Directors has the following Committees:
1. Audit Committee (AC)
2. Nomination and Remuneration Committee (NRC)
3. Stakeholders'' Relationship Committee (SRC)
4. Corporate Social Responsibility Committee (CSR)
Re-constitution of Committees during the year 2023-24:
The Board of Directors reconstituted AC, NRC, SRC and CSR Committees of the Board w.e.f. 12th August, 2023 by appointing Mr. Naimish B. Patel (DIN: 02813295), an Independent Director, as a Member of AC, NRC, SRC and CSR Committee, in place of Mr. Himanshu N. Rawal (DIN: 06631728), who ceased to be a Director of the Company and consequently as a Member of AC, NRC, SRC and CSR Committee of the Board w.e.f. 23rd September, 2023 due to completion of 2nd term as Independent Director of the Company.
The Board of Directors also reconstituted CSR Committee w.e.f. 9th November, 2023 by appointing Mrs. Veenaben B. Patel (DIN: 07131341), Independent Director, as a Member of CSR Committee in place of Shri Narayanbhai G. Patel, who ceased to be the Chairman & Whole-time Director and Member of CSR Committee due to sad demise on 3rd October, 2023.
Re-constitution of Committees during the period from 1st April, 2024 up to the date of this Report:
The Board of Directors reconstituted AC, NRC, SRC and CSR Committees of the Board w.e.f. 3rd August, 2024 by appointing Mr. Rajendrakumar C. Patel (DIN: 06532676), an Independent Director, as a Member of AC, NRC, SRC and CSR Committee, in place of Mr. Hareshkumar I. Shah (DIN: 00216585), who will cease to be an Independent Director of the Company and consequently as a Chairman of AC, NRC, SRC and CSR Committee of the Board w.e.f. 30th August, 2024 due to completion of 2nd term as Independent Director of the Company.
Chairman of re-constituted Committees:
The Board of Directors also appointed Mr. Naimish B. Patel (DIN: 02813295), an Independent Director, as a Chairman of AC, NRC, SRC and CSR Committee w.e.f. 30th August, 2024 in place of Mr. Hareshkumar I. Shah (DIN: 00216585), who will cease to be an Independent Director of the Company w.e.f. 30th August, 2024 and consequently as a Chairman of AC, NRC, SRC and CSR Committee of the Board.
The details of various Committees of Directors constituted by the Board of Directors as above under various provisions of Companies Act, 2013 and Rules made thereunder and SEBI Listing Regulations, Meetings & Attendance, terms of reference and other details are provided in the Corporate Governance Report annexed with the Directors'' Report.
The composition of various Committees and their terms of references may be accessed on the Company''s website viz. https://www.patelsairtemp.com/investors/composition-of-committees-of-board-of-directors/.
BOARD EVALUATION
The Board has carried out an evaluation of its own performance and that of its Committees and Directors and also Chairperson in terms of Section 134(3)(p) of the Companies Act, 2013 and Rules made thereunder and SEBI Listing Regulations. The Board has approved a policy (NRC Policy) for criteria of determining qualifications, selection, appointment and remuneration of Directors, KMP and Senior Management and the same has been uploaded on the Company''s web-site https://www.patelsairtemp.com/pdf/policies-and-code-of-conduct/nomination-and-remuneration-policy.pdf.
In a separate meeting of independent Directors held on 30th March, 2024, performance of non-independent directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors and assessed 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.
POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION
The Policy on appointment and remuneration of Directors, KMP and other employees and other matters as required under Section 178(3) of the Companies Act, 2013 is available on the web-site of the Company viz. https://www.patelsairtemp.com/pdf/policies-and-code-of-conduct/nomination-and-remuneration-policy. Edf.
NUMBER OF BOARD MEETINGS AND CIRCULAR RESOLUTIONS
During the financial year 2023-24, 4 (Four) Board Meetings of the Company were held on 27th May, 2023, 12th August, 2023, 9th November, 2023 and 10th February, 2024.
For the Board Meetings held as above, the gap between two Board Meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and Regulation 17 of SEBI Listing Regulations. The Board Meetings were held at the Factory (Works) of the Company situated at Rakanpur, Dist. Gandhinagar, Gujarat.
The particulars of number of meetings held and attended by each Director are detailed in the Corporate Governance Report, which forms part of this Report. Agenda of the meetings were prepared and all necessary papers were circulated to Members of the Board in advance. Necessary disclosures were made by the Directors in the Board and Committee Meetings whenever required. The Company has complied with Secretarial Standards 1 (SS-1) related to Board and Committee Meetings of the Company issued by ICSI.
During the financial year 2023-24, 3 (three) Circular Resolutions in respect of the following matters have been passed by the Board of Directors on 27th September, 2023 and 8th December, 2023 and duly confirmed by the Board of Directors in the next Board Meeting of the Company as per Section 175 of the Companies Act, 2013 and Rules made thereunder and as per Secretarial Standards SS-1issued by ICSI:
1) Approval of Cost Audit Report for the year 2022-23 issued by M/s. Rajendra Patel & Associates, Cost Accountant, Ahmedabad (Firm Regn. No. FRN 101163), Cost Auditor of the Company in respect of cost records maintained by the Company for various products of the company.
2) Taking note of Show Cause Notice (SCN) dated 1st September, 2023 received from SEBI and authority to Managing Director to sign the Settlement Application along with all annexures on behalf of the Company and submit the same to SEBI and to appoint various persons to appear, act and plead before SEBI under Settlement Scheme on behalf of the Company against the said SCN.
3) Approval to wind-up / dissolve Patels Airtemp (USA) Inc., a 100% Wholly-Owned Subsidiary (WOS) of the Company.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
As required under Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure - E attached herewith and forming part of the Directors'' Report.
RISK MANAGEMENT
Business risk evaluation and management, covering the business operations of the Company, is an ongoing process within the Company and the management reviewed frequently risk assessment and to minimize them. The ultimate goal of risk management is the preservation of physical and human assets of the organization for successful continuation of its operations. Pursuant to the provisions of Regulation 21 of SEBI Listing Regulations, at present, the Company is not required to constitute Risk Management Committee of the Directors of the Company.
CORPORATE SOCIAL RESPONSIBILITY
The details regarding Corporate Social Responsibility of the Company are given in the Corporate Governance Report, which forms part of this Report.
The salient features of the Policy forms part of the Annual Report on CSR activities annexed to the Board''s Report. The Annual Report on CSR activities and expenditure, as required under Sections 134 and 135 of the Companies Act, 2013 read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Rule 9 of the Companies (Accounts) Rules, 2014, is annexed herewith marked as Annexure - F.
The policy also indicates the activities to be undertaken by the Company within the broad framework of Schedule VII of the Companies Act, 2013, as in force and as amended from time to time which includes promotion of educational and employment enhancing vocational skills and education of underprivileged children, social development/services, promotion of healthcare, including preventive health care i.e. for medical treatment, rehabilitation and sanitation and disaster management, environmental sustainability, rural development project, eradicating hunger, poverty and malnutrition, promoting health care including preventive health care and promoting gender equality, empowering women and measures for reducing inequalities faced by socially and economically backward groups and such other activities and programs as recommended by CSR committee from time to time.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.
The Company''s internal control system is commensurate with its size, scale and complexities of its operations.
STATUTORY AUDITORS
M/s. Parikh & Majmudar, Chartered Accountants, Ahmedabad (Firm Registration No. 107525W) were appointed as Statutory Auditors of your Company at the 30th Annual General Meeting of the Company held on 27th September, 2022, for a first term of five consecutive years from the conclusion of the said 30th Annual General Meeting of the Company till the conclusion of the 35th Annual General Meeting to be held in the year 2027 in place of retiring Statutory Auditors M/s. Shah & Shah Associates, Chartered Accountants, Ahmedabad (Firm Registration No. 113742W).
In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs (MCA), the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting. Accordingly, no resolution has been proposed for ratification of appointment of Auditors of the Company.
No fraud has been reported by the Auditors under Section 143(12) of the Companies Act, 2013 requiring disclosure in the Board''s Report, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
During the Financial Year 2023-24, the Company has paid total fees of '' 4,38,000 including statutory audit fees, certification fees, and fees for other services to M/s. Parikh & Majmudar, Chartered Accountants, Ahmedabad, the Statutory Auditors of the Company (Firm Registration No. 113742W).
AUDIT REPORT (EMPHASIS OF MATTERS)
The Statutory Auditors have mentioned in their Audit Report the following Notes in respect of Audited Standalone Financial Statements of the Company for the year ended 31st March, 2024 as Emphasis of the Matter:
"During the year under review, M/s. Patels Airtemp (USA) Inc., a Wholly Owned Subsidiary (WOS/Foreign Entity) of the Company, stands dissolved w.e.f. 11th December, 2023 as per Certificate of Dissolution issued by State of Delaware (USA). Consequent, upon the said dissolution, Patels Airtemp (USA) Inc. ceased to be a Subsidiary Company and accordingly the company has written off Investment in Wholly Owned Subsidiary amounting to '' 7.17 Lakhs and Loan to Wholly Owned Subsidiary amounting to '' 5.32 Lakhs in the books of accounts during the financial year ended on 31st March, 2024."
The Statutory Auditors have also mentioned the following notes in their Auditors'' Report as Emphasis of the Matter:
"The balance confirmation from the suppliers and customers have been called for, but the same are awaited till the date of audit. Thus, the balances of receivables and trade payables have been taken as per the books of accounts submitted by the company and are subject to confirmation from the respective parties."
However, the Auditors clarified in its report that their Conclusion is not modified in respect of the above matters of emphasis.
The Notes on financial statement referred to in the Auditors'' Report and mentioned above are selfexplanatory and do not call for any further comments. The Auditors'' Report does not contain any qualification, reservation, adverse remark or disclaimer, except Emphasis of the Matter as mentioned above.
SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT
Section 204 of the Companies Act, 2013 and Rules made thereunder inter alia requires every Listed Company to annex with its Board Report a Secretarial Audit Report given by a Company Secretary in Practice in the prescribed form. The Board appointed Mr. Punit Lath, Practicing Company Secretary, Ahmedabad (COP No. 11139 & Membership No. 26238) as the Secretarial Auditor to conduct Secretarial Audit of the records of the Company for the financial year 2023-24. Secretarial Auditor has submitted to the Company the Secretarial Audit Report for the financial year ended March 31,2024 and annexed herewith marked as Annexure - G to this Report.
The Secretarial Audit Report for the financial year 2023-24 does not contain any qualification, reservation or adverse remark. During the year under review, the Secretarial Auditors had not reported any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
The Board at its meeting held on 10th February, 2024, has re-appointed Mr. Punit Lath as Secretarial Auditor, for conducting Secretarial Audit of the Company for the financial year 2024-25. The Company has received his written consent that the appointment is in accordance with the applicable provisions of the Act and rules framed thereunder.
COMPLIANCE CERTIFICATE
The Company has also received Secretarial Compliance Report for the year ended 31st March, 2024 from Mr. Punit Lath (COP No. 11139 & Membership No. 26238), Practicing Company Secretary and duly filed with BSE Ltd., in respect of compliance with the provisions of:
(a) the Securities and Exchange Board of India Act, 1992 ("SEBI Act") and the Regulations, circulars, guidelines issued thereunder; and
(b) the Securities Contracts (Regulation) Act, 1956 ("SCRA"), rules made there under and the Regulations, circulars, guidelines issued there under by the Securities and Exchange Board of India ("SEBI").
COST AUDIT
Pursuant to Section 148(2) of the Companies Act, 2013 read with the Companies (Cost Records and Audit), Amendment Rules 2014, your Company is required to get its cost accounting records audited by a Cost Auditor.
Accordingly, the Board at its meeting held on 24th May, 2024, has on the recommendation of the Audit Committee, appointed M/s. Rajendra Patel & Associates, Cost Accountant, Ahmedabad (Firm Registration No. FRN101163) to conduct the audit of the cost accounting records of the Company for FY 2023-24 on a remuneration of '' 80,000/- plus taxes as applicable and reimbursement of actual travel and out of pocket expenses. The remuneration is subject to the ratification of the Members in terms of Section 148 read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014 and is accordingly placed for your ratification. The Company has received their written consent that the appointment is in accordance with the applicable provisions of the Act and rules framed thereunder and confirmed that their appointment is within the limits of the Section 139 of the Companies Act, 2013. They have also certified that they are free from any disqualifications specified under Section 141 of the Companies Act, 2013.
The Cost Audit Report for the Financial Year ended 31st March, 2023 has been duly filed in XBRL mode. The cost audit report of the Company for financial year ended March 31, 2024 will be filed with Central Government on or before the due date as prescribed under Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014.
INTERNAL AUDIT
Pursuant to the provisions of Regulation 18 read with Part C of Schedule II of SEBI Listing Regulations, the Audit Committee reviews quarterly the Report of internal audit received from Internal Auditor of the Company relating to internal control weakness, if any, as mentioned in the Internal Audit Report.
LISTING FEES
Pursuant to the provisions of SEBI Listing Regulations, the Company declares that the Equity Shares of the Company are listed on the BSE Limited (BSE). The Company confirms that it has paid Annual Listing Fees to BSE up to the Financial Year 2024-25.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The Disclosures relating to remuneration and other details required under Section 197(12) of the Companies Act, 2013 read with the Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is annexed as Annexure - H and forms an integral part of this Report.
A statement showing the names of top 10 employees in terms of remuneration drawn as per Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is annexed as Annexure - H and forms an integral part of this Report.
The Statement of particulars of employees under Section 197(12) read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is not provided with as, during the financial year under review, no employee of the Company including Whole-time Directors and Managing Directors were in receipt of remuneration in excess of the limits set out in the said rules.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The Company has a Vigil mechanism and Whistle blower policy under which the employees are free to report any act of serious misconduct or wrongful activity being occurred or suspected to occur within the organization, to his immediate HOD or the HR Head or directly to the concern Whole-time Directors or Managing Directors of the Company, as he may desire. No employee of the Company is denied access to the Audit Committee. The vigil mechanism/whistle blower policy is also available on the web-site of the Company viz. https://www. patelsairtemp.com/pdf/policies-and-code-of-conduct/whistel-blower-cum-vigil-mechanism-policv.pdf. During the year under review, the Company has not received any whistle blower complaint.
DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The Company has zero tolerance towards sexual harassment at the workplace. The Company has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. All employees (permanent, contractual, temporary, trainees) are covered under the said Policy.
All employees (permanent, contractual, temporary, trainees) are covered under this policy. No complaints pertaining to sexual harassment were received during the financial year 2023-24.
Policy on Prevention, Prohibition and Punishment of Sexual Harassment is also available on the web-site of the Company viz. https://www.patelsairtemp.com/pdf/policies-and-code-of-conduct/sexual-harassment-policy.pdf
GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the year under review:
0 The Company does not provide any loan or other financial arrangement to its employees or Directors or Key Managerial Personnel for purchase of its own shares and hence, the disclosure under Section 67(3)(c) of the Companies Act, 2013 does not require.
0 The disclosure in terms of Rule 4 of Companies (Share Capital and Debenture) Rules, 2014 is not provided, as the Company does not have any equity shares with differential voting rights.
0 No fraud has been reported by the Auditors to the Audit Committee or the Board.
0 The Company has not issued any shares under any scheme including Employees'' Stock Options Schemes or Sweat Equity Shares to employees of the Company.
0 Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration
or commission from its subsidiary.
0 There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016.
0 There was no instance of onetime settlement with any Bank or Financial Institution.
ACKNOWLEDGEMENT
The Directors place on record the appreciation and gratitude for the co-operation and assistance extended by various departments of the Union Government, State Government, Bankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere services of the employees of the Company at all levels.
The Company will make every effort to meet the aspirations of its Shareholders and wish to sincerely thank them for their whole hearted co-operation and support at all times.
Mar 31, 2018
The Directors have pleasure in presenting herewith the 26th Annual Report together with the Audited Financial Statements for the year ended on 31st March, 2018.
FINANCIAL RESULTS:
(Rs. in Lacs)
|
Particulars |
Year ended on 31-03-2018 |
Year ended on 31-03-2017 |
|
Revenue from Operations |
15938.44 |
14860.71 |
|
Other Income |
42.85 |
50.71 |
|
Total Income |
15981.29 |
14911.42 |
|
Less: Depreciation & Amortisation Expenses |
259.41 |
258.16 |
|
Finance Cost |
485.89 |
302.54 |
|
Other Expenses |
13971.06 |
13126.50 |
|
Total Expenses |
14716.36 |
13687.20 |
|
Profit before Tax |
1264.93 |
1224.22 |
|
Less : Tax Expenses |
403.78 |
433.03 |
|
Net Profit for the year |
861.15 |
791.19 |
|
Balance brought forward from previous year |
5370.28 |
4714.14 |
|
Profit available for Appropriation |
6231.43 |
5505.33 |
|
Other Comprehensive Income |
(13.59) |
(0.79) |
|
Less: Proposed Dividend |
126.76 |
111.55 |
|
Less: Tax on Dividend |
25.80 |
22.71 |
|
Less: Transfer to General Reserve |
-- |
-- |
|
Surplus carried forward to Balance Sheet |
6065.28 |
5370.28 |
|
Total Comprehensive Income |
847.56 |
790.39 |
|
Earning Per Share (Rs.) |
16.98 |
15.60 |
The Company has adopted Ind AS w.e.f. 1st April, 2017 with a transition date of 1st April, 2016. Accordingly, results for the year ended 31st March, 2018 have been prepared in accordance with Ind AS prescribed under Section 133 of the Companies Act, 2013 and other accounting principles generally accepted in India.
Consequent to introduction of Goods and Services Tax ("GST") effect from 1st July, 2017, Central Excise, VAT etc. have been subsumed into GST. In accordance with Ind AS 18 on Revenue and Schedule III of the Companies Act, 2013, unlike Excise Duty, levies like GST, VAT etc. are not part of revenue. Accordingly, the figures for the year ended on 31st March, 2018 are not strictly relatable to previous year.
STATE OF COMPANY''S AFFAIRS
The Company has earned revenue from operations (gross) of Rs.159.38 crores during the year ended on 31st March, 2018 as against Rs.148.61 crores earned during the previous year ended on 31st March, 2017, giving a rise of 7.25 % as compared to previous year. The Company has also earned other income of Rs. 42.85 lakhs during the year under review as against Rs.50.71 lakhs earned during the previous year.
Out of the revenue from operations of Rs.159.38 crores earned by the Company during the year under review, Rs.152.62 crores represents sale of products (Domestic & Export), Rs.2.52 crores represents sale of Services (Processing Charges) and Rs.4.24 crores represents other operating revenues.
The Company has earned the Profit before Tax of Rs.12.65 crores during the year ended on 31st March, 2018 as compared to Rs.12.24 crores earned during the previous year ended on 31st March, 2017.
The Company has earned Net Profit of Rs.8.61 crores for the year ended on 31st March, 2018 after making Provision for Tax Expenses of Rs.4.04 crores and other adjustments, as compared to Net Profit of Rs.7.91 crores earned by the Company during the previous year ended on 31st March, 2017, a rise of 8.85 %.
After adding the Surplus in the Statement of Profit & Loss of Rs.53.70 crores brought forward from the previous year to the profit of Rs.8.61 crores earned by the Company during the year under review and other adjustment, the total amount of Rs.62.31 crores is available for appropriation.
The Audited Financial Statements of the Company and all other documents required to be attached thereto is put on the Company''s website.
FUTURE PROSPECTS
As you aware that the Company is in engineering industry and is engaged in manufacturing/fabricating tailor made machines and therefore, the order book position of such type of company can play pivotal role in the growth of the Company. Your Directors are pleased to state that continuing the past trend, the Company is having confirmed orders of about Rs.240.37 Crores on hand as on 1st August, 2018. Thus your Directors are quite bullish on repeating similar performance in future. Your Directors are cautious and making untiring efforts so as not to compromise on growth, quality, and profitability of the Company.
CHANGE IN SHARE CAPITAL
There is no change in the Share Capital of the Company during the year under review. During the year under review, the Company has not issued any shares.
DIVIDEND
The Directors have recommended dividend of Rs.2.50 per share (@ 25 %) on 50,70,240 Equity Shares of Rs.10 each of the Company for the Financial Year ended on 31st March, 2018 (2017-2018), as compared to Dividend of Rs.2.50 per share (@ 25 %) declared for the previous Financial Year ended on 31st March, 2017. This will absorb Rs.126.76 lakhs. The corporate dividend tax payable by the Company on the said dividend will be Rs.25.80 lakhs.
A resolution to that effect has been placed for the approval of the members at this Annual General Meeting of the Company and that the same, when declared, shall be paid to the Members.
TRANSFER TO RESERVE
In view of above, the Company has not transferred any amount to the General Reserve for the year ended on 31st March, 2018 and the total amount of Rs.60.65 crores is proposed to be retained as the Surplus in the Statement of Profit and Loss.
MATERIAL CHANGES AND COMMITMENTS
In terms of Section 134(3)(l) of the Companies Act, 2013, no material changes or commitments affecting the financial position of the Company have occurred between the end of the financial year and the date of this Report. There has been no change in the nature of business of the Company.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY''S OPERATIONS IN FUTURE
The Company has not received any significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company''s operations in future.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company as required under Section 92(3) read with Section 134(3)(a) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, in the prescribed Form MGT-9, is annexed herewith as Annexure - A, to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS
In terms of provisions of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report has been enclosed herewith as per Annexure - B and forming part of the Directors'' Report.
RECOGNITION OR AWARDS
The Company''s products have ASME (American Society of Mechanical Engineers-USA) "U"/ "U27 "Sâ and "N & NPT" Stamp authorization. The Company is also a member of HTRI (Heat Transfer Research, Inc, U.S.A.) for updating Heat Transfer Technology.
Last year ASME accredited N & NPT authorization to the Company, a Global Qualification to manufacture Heat Exchangers & Pressure Vessels for Nuclear Power Plant. The Company is the 3rd Company in India with "N-NPTâ authorization to manufacture above equipments which has put the Company in elite League of Critical Nuclear Power Plant Equipments.
Due to "Uâ/ "U2"/ "Sâ and "N & NPTâ Stamp authorization, it is expected to improve the Quality of the products/equipments of the Company and to achieve higher growth and profitability of the Company in future.
The Company has upgraded the ISO certification from ISO 9001:2008 to ISO 9001-2015 certified. FINANCE
UNDER CONSORTIUM ARRANGEMENT WITH BANK OF BARODA & AXIS BANK
Bank of Baroda and AXIS Bank have sanctioned additional Credit facility of Rs.10.00 Crores (Rs.5.00 Crores from BOB and Rs.5.00 Crores from AXIS Bank) making aggregate Working Capital facilities of Rs.112.00 Crores from BOB and AXIS Bank. As such, the Company is availing Working Capital facilities aggregating to Rs.112.00 Crores under consortium arrangement with Bank of Baroda and Axis Bank. The Company has made regular repayment of Loan & interest and there is no any overdue payment to the said Banks.
During the year under review, HDFC Bank Ltd. has also granted to the Company Bill Discounting facility to the extent of Rs.7,00,00,000.
ACCEPTANCE OF DEPOSITS
During the year under review, the Company has not accepted any deposits from the Public and Members of the Company and therefore not required to comply with the requirement under the Companies Act, 2013 and the Rules made thereunder. As such, no amount of principal or interest was outstanding to the Public and Members of the Company as on March 31, 2018 and the Company is not required to furnish information in respect of outstanding deposits under Non-banking, Non-financial Companies (Reserve Bank) Directions, 1966 and Companies (Accounts) Rules, 2014.
During the year under review, the Company has accepted deposits from the Directors of the Company which are exempted deposits under Rule 2(1 )(c)(viii) of Companies (Acceptance of Deposits) Rules, 2014, subject to compliance of the provisions of the Companies Act, 2013 and the Rules made thereunder.
During the year under review, the Relatives of the Directors also brought in unsecured loan/deposits by way of contribution to bring additional long term funds as a part of conditions imposed by Bank of Baroda on the Directors and their relatives, while reviewing working capital facilities to the Company vide its letter dated 20-12-2016 and 27-3-2018, which are exempted deposits under Rule 2(1) (c) (xiii) of Companies (Acceptance of Deposits) Rules, 2014.
Details of deposits accepted and repaid by the Company including interest to the Directors & their Relatives during the financial year 2017-2018 are mentioned in Note No. 30 (Related party information) of the Notes to the Financial Statements attached with this Annual Report.
TRANSFER OF UNCLAIMED DIVIDEND TO IEPF
In terms of the provisions of Investor Education and Protection Fund Rules, 2001 (IEPF), during the year under review, the Company has transferred the amount of unclaimed/unpaid Dividend of Rs.1,85,102 for the financial year 2009-2010 to IEPF established by the Central Government under Section 124 & 125 of the Companies Act, 2013 and Rules made thereunder.
Pursuant to provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 19thSeptember, 2017 (date of the previous Annual General Meeting) on the Company''s website: http://www.patelsairtemp.com.
TRANSFER OF SHARES TO IEPF DEMAT AUTHORITY ACCOUNT
Adhering to the various requirements set out in the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, the Company has, during financial year 2017-18, transferred to the IEPF Authority all shares in respect of which dividend had remained unpaid or unclaimed for seven consecutive years or more. Details of shares transferred to the IEPF Authority are available on the website of the Company. The said details have also been uploaded on the website of the IEPF Authority and the same can be accessed through the link: www.iepf.gov.in. In accordance with the said IEPF Rules and its amendments, the Company had sent notices to all the Shareholders whose shares were due to be transferred to the IEPF Authority and simultaneously published newspaper advertisement.
SUBSIDIARY, ASSOCIATE OR JOINT VENTURE COMPANY
The Company does not have any subsidiary, joint venture or associate companies within the meaning of Section 2(6) and 2(87) of the Companies Act, 2013. As such, a report in the prescribed Form AOC-1 as per first proviso to sub-section (3) of Section 129 of the Companies Act, 2013 and Rules made thereunder is not required to be attached and a Policy for determining material subsidiaries is not required to be framed by the Company.
CONSOLIDATED FINANCIAL STATEMENTS
Since the Company does not have any subsidiary, joint venture or associate companies as mentioned above, Consolidated Financial Statements are not required to be prepared and attached with the financial statement of the Company pursuant to the requirements of Section 129 read with Schedule III of the Companies Act, 2013 and Rules made thereunder and Listing Regulations and applicable Accounting Standards.
CORPORATE GOVERNANCE
Being a Listed Company, the Company has taken necessary measures to comply with the provisions of Listing Regulations regarding Corporate Governance as amended from time to time. A separate report on Corporate Governance for the year ended on 31st March, 2018 is attached herewith as a part of this Annual Report viz Annexure - C. A certificate from Statutory Auditors of the Company regarding compliance of the aforesaid provisions of Corporate Governance is obtained by the Company and annexed to the Corporate Governance Report. The Auditors'' Certificate for the financial year 2017-2018 does not contain any qualification, reservation or adverse remark in respect of Corporate Governance Report.
DIRECTORS'' RESPONSIBILITY STATEMENT
To the best of their knowledge and belief and according to the confirmation and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(C) and 134(5) of the Companies Act, 2013 and confirm that :
(a) in the preparation of the annual accounts for the year ended 31st March, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act have been followed and there are no material departures from the same;
(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the profit of the Company for the year ended on that date;
(c) the Directors have taken proper and sufficient 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 have prepared the annual accounts for the year ended on 31st March, 2018 on a going concern basis ;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls 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 were adequate and operating effectively.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given, investments made, guarantees given and securities provided by the Company under Section 186 of the Companies Act, 2013 are not provided, as during the year under review, the Company has not given any loan nor made any investment nor given any guarantee nor provided any security to any person.
RELATED PARTY TRANSACTIONS
Information on transaction with related party referred to under sub-section (1) of Section 188 of the Companies Act, 2013 in the prescribed Form AOC-2 is attached herewith viz Annexure - D and forming part of the Directors'' Report pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014.
Transaction with related parties pursuant to the provisions of Listing Regulations and erstwhile Listing Agreement are disclosed in Note No. 30 of the Notes to the Financial Statements for the year ended on 31st March, 2018, in the Annual Report as required by the Accounting Standard (AS) 18 issued by ICAI.
However, there are no materially significant related party transactions made/entered into by the Company with its related parties including promoters, directors or the management etc. that may have potential conflict with the interests of the Company at large.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website viz. www.patelsairtemp.com.
All Related Party Transactions are placed before the Audit Committee as also to the Board for approval. However, the Company had not entered into any contract/ arrangement / transaction with related parties which could be considered material in accordance with the provisions of Section 188 of the Companies Act, 2013 and the Rules made thereunder and Listing Regulations and as such no approval of the Shareholders require.
SECRETARIAL STANDARDS
The Directors state that applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to ''Meetings of the Board of Directors'' and ''General Meetings'', respectively, have been duly followed by the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Pursuant to the provisions of Section 152(6)(d) of the Companies Act, 2013 and Rules made thereunder, Mr. Narendra G. Patel (DIN: 00023205), Whole-time Director of the Company, shall retire by rotation as a Director of the Company at this Annual General Meeting as determined by lot at the Board Meeting of the Company held on 14th August, 2017 between himself and Mr. Prakash N. Patel (DIN: 00249210), Managing Director of the Company, as they became Directors on the same day at the time of their last appointment, and being eligible, offer himself for re-appointment, for which necessary resolution has been incorporated in the notice of the meeting. The Board of Directors recommends re-appointment of Mr. Narendra G. Patel as a Director of the Company. The brief resume/details relating to the said Director, who is to be re-appointed are furnished in the Notes to the Notice of the Annual General Meeting.
Mr. Himanshu N. Rawal (DIN : 06631728) who was appointed as an Independent Director of the Company, holds office up to the conclusion of this i.e. 26th Annual General Meeting of the Company ("first term" in terms of Sections 149(10) of the Companies Act, 2013). The Company has received notice under Section 160 of the Companies Act, 2013 from a shareholder of the Company proposing the re-appointment of Mr. Himanshu N. Rawal for the Office of Director of the Company in the category of Independent Director for a second term of 5 (five) consecutive years up to the conclusion of the 31st Annual General Meeting of the Company in the calendar year 2023. A brief profile of Mr. Himanshu N. Rawal is given in the notice convening the 26th AGM, for the reference of the shareholders. The Board taking into account the recommendation of the Nomination and Remuneration Committee and on the basis of the report of performance evaluation of Independent Directors, has recommended the reappointment of Mr. Himanshu N. Rawal as an Independent Director of the Company, for the aforesaid term.
The remuneration payable to (i) Mr. Narayanbhai G. Patel, Chairman & Whole-time Director, (ii) Mr. Prakash N. Patel, Managing Director, (iii) Mr. Sanjiv N. Patel, Managing Director and (iv) Mr. Narendra G. Patel, Whole-time Director of the Company, has been increased from Rs. 2,50,000 per month to Rs.3,00,000 per month with perquisites and allowances, subject to the approval of the shareholders, for which, necessary resolutions have been incorporated in the Notice of the Meeting seeking Members approval for the same.
Pursuant to the provisions of Section 149 and 152 of the Companies Act, 2013 and Rules made thereunder and on the recommendation of the Nomination and Remuneration Committee, the Company proposes to appoint Mr. Apurva V. Shah (DIN :0008197983), who was appointed as Additional Director at the Board Meeting held on 11th August, 2018, as Director of the Company (Non-independent Director), liable to retire by rotation. The Company has received requisite notice in writing from a Member proposing his candidature for appointment as a Director of the Company. Mr. Apurva V. Shah (DIN :0008197983) has been appointed as Whole-time Director of the Company for period of 3 years w.e.f. 11th August, 2018 with payment of remuneration. Necessary resolutions have been incorporated in the Notice of the Meeting seeking Members approval for the same.
In accordance, with the recently notified changes in the Listing Regulations, the Company shall ensure that the appointment of any Non-Executive Director who has attained the age of 75 years is approved by the Members by way of a Special Resolution. In this regard, Mr. Ramanbhai R. Patel will continue as Non-executive Independent Director of the Company who has attained the age of 75 years during his tenure as an Independent Director of the Company. The Board of Directors therefore recommends the Special Resolution for approval of the members.
The Company has received declarations from all the Independent Directors of the Company in terms of Section 149(7) of the Act, confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(b) & 25 of SEBI Listing Regulations, 2015. COMMITTEES OF DIRECTORS The Board of Directors has the following Committees:
1. Audit Committee (AC)
2. Nomination and Remuneration Committee (NRC)
3. Stakeholders'' Relationship Committee (SRC)
4. Corporate Social Responsibility Committee (CSR)
The details of various Committees of Directors constituted by the Board of Directors under various provisions of Companies Act, 2013 and Rules made thereunder and Listing Regulations, Meetings & Attendance, terms of reference and other details are provided in the Corporate Governance Report annexed with the Directors'' Report.
The composition of various Committees and their terms of references may be accessed on the Company''s website viz. www.patelsairtemp.com.
BOARD EVALUATION
The Board has carried out an evaluation of its own performance and that of its Committees and Directors and also Chairperson in terms of Section 134(3)(p) of the Companies Act, 2013 and Rules made thereunder and Listing Regulations. The Board has approved a policy (NRC Policy) for criteria of determining qualifications, selection, appointment and remuneration of Directors, KMP and Senior Management and the same has been uploaded on the Company''s web-site www.patelsairtemp.com. In a separate meeting of independent Directors, performance of non-independent directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors and assessed 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.
POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION
The Policy on appointment and remuneration of Directors, KMP and other employees and other matters as required under Section 178(3) of the Companies Act, 2013 is available on the web-site of the Company viz. www.patelsairtemp.com.
NUMBER OF BOARD MEETINGS
During the financial year 2017-2018, 5 (Five) Board Meetings were held on 30/05/2017, 14/08/2017, 14/09/2017, 08/12/2017 & 10/02/2018. The gap between two Board Meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and Regulations 17 of the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulation, 2015.
The particulars of number of meetings held and attended by each Director are detailed in the Corporate Governance Report, which forms part of this Report. Agenda of the meetings were prepared and all necessary papers were circulated to Members of the Board in advance. Necessary disclosures were made by the Directors in the Board Meeting whenever required. The Company has complied with Secretarial Standards 1 (SS-1) related to Board Meeting of the Company.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
As required under Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure - E attached herewith and forming part of the Directors'' Report.
RISK MANAGEMENT
Business risk evaluation and management, covering the business operations of the Company, is an ongoing process within the Company and the management reviewed frequently risk assessment and to minimize them. The ultimate goal of risk management is the preservation of physical and human assets of the organization for successful continuation of its operations. Pursuant to the provisions of Regulation 21 of the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015, at present, the Company is not required to constitute Risk Management Committee of the Directors of the Company.
CORPORATE SOCIAL RESPONSIBILITY
In terms of provisions of Section 135 of the Companies Act, 2013 and Rules made thereunder, a Committee of the Directors of the Company has been constituted as Corporate Social Responsibility (CSR) Committee. CSR Committee has formulated a policy on the Corporate Social Responsibility measures to be undertaken by the Company as specified in Schedule VII to the Companies Act, 2013. The Corporate Social Responsibility Policy is available on the Company''s web-site viz. www.patelsairtemp.com.
The Company has duly spent the required amount during the financial year ended on 31st March, 2018 towards CSR activities. The Annual Report on CSR activities including Responsibility Statement of the CSR Committee is annexed herewith marked as Annexure - F.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.
The Company''s internal control system is commensurate with its size, scale and complexities of its operations.
STATUTORY AUDITORS & AUDIT REPORT
M/s. Shah & Shah Associates, Chartered Accountants, Ahmedabad, having Firm Registration No. 113742W were appointed as Statutory Auditors of your Company at the 25th Annual General Meeting held on 19th September, 2017, for a term of five consecutive years. In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting. Accordingly, no resolution has been proposed for ratification of the Statutory Auditors. No fraud has been reported by the Auditors under Section 143(12) of the Companies Act, 2013 requiring disclosure in the Board''s Report.
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 AUDITOR & SECRETARIAL AUDIT REPORT
Section 204 of the Companies Act, 2013 and Rules made thereunder inter alia requires every Listed Company to annex with its Board Report a Secretarial Audit Report given by a Company Secretary in Practice in the prescribed form. The Board had appointed Mr. Punit Lath, Practicing Company Secretary, Ahmedabad (COP No. 11139) as the Secretarial Auditor to conduct Secretarial Audit of the records of the Company for the financial year 2017-2018 and to submit his report to the Company. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith marked as Annexure -G to this Report.
The Board at its meeting held on 10th February, 2018, has reappointed Punit Lath, as Secretarial Auditor, for conducting Secretarial Audit of the Company for FY 2018-2019. The Company has received his written consent that the appointment is in accordance with the applicable provisions of the Act and Rules framed thereunder.
The Secretarial Audit Report for the financial year 2017-2018 does not contain any qualification, reservation or adverse remark. During the year under review, the Secretarial Auditors had not reported any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
COST AUDIT
Pursuant to Section 148(2) of the Companies Act, 2013 read with the Companies (Cost Records and Audit), Amendment Rules 2014, your Company is required to get its cost accounting records audited by a Cost Auditor.
Accordingly, the Board at its meeting held on 26th April, 2018, has on the recommendation of the Audit Committee, appointed M/s. Rajendra Patel & Associates, Cost Accountant, Ahmedabad (Firm Registration No. FRN101163 and Membership No. 29021) to conduct the audit of the cost accounting records of the Company for FY 2018-2019 on a remuneration of Rs.80,000 plus taxes as applicable and reimbursement of actual travel and out of pocket expenses. The remuneration is subject to the ratification of the Members in terms of Section 148 read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014 and is accordingly placed for your ratification. The Company has received their written consent that the appointment is in accordance with the applicable provisions of the Act and rules framed thereunder.
The Cost Audit Report for the Financial Year ended 31st March, 2017 has been duly filed in XBRL mode. The cost audit report of the Company for financial year ended March 31, 2018 will be filed with Central Government on or before the due date as prescribed under Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014.
INSURANCE
All insurable interests of the Company including buildings, plant and machinery, furniture & fixtures and other insurable interest are adequately insured.
LISTING FEES
Pursuant to the provisions of Listing Regulations, the Company declares that the Equity Shares of the Company are listed on the BSE Limited (BSE). The Company confirms that it has paid Annual Listing Fees to BSE up to the Financial Year 2018-2019.
PARTICULARS OF EMPLOYEES
The Disclosure required under Section 197(12) of the Companies Act, 2013 read with the Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is annexed as Annexure - H and forms an integral part of this Report.
A statement showing the names of top 10 employees in terms of remuneration drawn as per Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is annexed as Annexure - H and forms an integral part of this Report.
The Statement of particulars of employees under Section 197(12) read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is not provided with as, during the financial year under review, no employee of the Company including Whole-time Directors and Managing Directors were in receipt of remuneration in excess of the limits set out in the said rules.
WHISTLE BLOWER POLICY / VIGIL MECHANISM
The Company has a Vigil mechanism and Whistle blower policy under which the employees are free to report any act of serious misconduct or wrongful activity being occurred or suspected to occur within the organization, to his immediate HOD or the HR Head or directly to the concern Whole-time Directors or Managing Directors of the Company, as he may desire. No employee of the Company is denied access to the Audit Committee. The vigil mechanism/whisle blower policy is also available on the website of the Company viz. www.patelsairtemp.com.
GENERAL
- During the year under review, there was no change in the nature of business of the Company and there is no material change and/or commitments, affecting the financial position of the Company, during the period from 31st March, 2018 till the date of this report.
- The Company does not provide any loan or other financial arrangement to its employees or Directors or Key Managerial Personnel for purchase of its own shares and hence, the disclosure under Section 67(3)(c) of the Companies Act, 2013 does not require.
- The disclosure in terms of Rule 4 of Companies (Share Capital and Debenture) Rules, 2014 is not provided, as the Company does not have any equity shares with differential voting rights.
- The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made thereunder. The Policy aims to provide protection to employees at the workplace and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.
All employees (permanent, contractual, temporary, trainees) are covered under this policy. No complaints pertaining to sexual harassment were received during FY 2017-2018.
- No fraud has been reported by the Auditors to the Audit Committee or the Board.
ACKNOWLEDGEMENT
The Directors place on record the appreciation and gratitude for the co-operation and assistance extended by various departments of the Union Government, State Government, Bankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere services of the employees of the Company at all levels.
The Company will make every effort to meet the aspirations of its Shareholders and wish to sincerely thank them for their whole hearted co-operation and support at all times.
By order of the Board of Directors
NARAYANBHAI G. PATEL
Chairman & Whole-time Director
Date : 11th August, 2018
Place : Rakanpur, Dist. Gandhinagar
Mar 31, 2016
To,
The Members,
Patels Airtemp (India) Ltd.,
Ahmedabad
The Directors have pleasure in presenting herewith the 24th Annual Report together with the Audited Statement of Accounts for the year ended on 31st March, 2016.
FINANCIAL RESULTS:
(Rs. in Lacs)
|
Particulars |
Year ended on 31-03-2016 |
Year ended on 31-03-2015 |
||
|
Revenue from Operations (Net) Other Income |
12664.72 45.78 |
11274.64 42.20 |
||
|
Total Revenue |
12710.50 |
11316.84 |
||
|
Less: Depreciation & Amortization Expense Finance Cost Other Expenses |
239.59 186.77 11176.34 |
248.63 267.67 9838.58 |
||
|
Total Expenses |
11602.70 1107.80 |
10354.88 961.96 |
||
|
Profit / (Loss) on sale of Fixed Assets |
0.93 |
Nil |
||
|
Profit before Taxation |
1108.73 |
961.96 |
||
|
Tax Expenses : |
||||
|
- Net Current Tax Expenses - Deferred Tax |
392.31 1.60 |
393.91 |
324.63 17.10 |
341.73 |
|
Profit after Tax |
714.82 |
620.23 |
||
|
Balance brought forward from previous year |
4095.79 |
3767.02 |
||
|
Less: Adjustment on Account of Change in useful life of Assets |
Nil |
66.43 |
||
|
Less : Short Provision for Dividend Distribution Tax |
Nil |
0.78 |
||
|
Profit available for Appropriation |
4810.61 |
4320.04 |
||
|
Less: Proposed Dividend Less: Tax on Dividend Less Transfer to General Reserve Surplus carried forward to Balance Sheet |
111.54 22.71 90.00 4586.36 |
111.54 22.71 90.00 4095.79 |
||
|
Total |
4810.61 |
4320.04 |
||
|
Earnings Per Share |
14.10 |
12.23 |
||
STATE OF COMPANYâS AFFAIRS:
The Company has earned revenue from operations (net) of Rs. 12664.72 lakhs during the year ended on 31st March, 2016 as against Rs. 11274.64 lakhs earned during the previous year ended on 31st March, 2015, giving a rise of 12.33 % as compared to previous year. Out of the revenue from operations of Rs. 12664.72 lakhs earned by the Company during the year under review, Rs. 11867.51 lakhs represents sale of products (Domestic & Export), Rs. 410.37 lakhs represents sale of Services (Processing Charges) and Rs. 386.84 lakhs represents other operating revenues. The Company has also earned other income of Rs. 45.78 lakhs during the year under review as against Rs. 42.20 lakhs earned during the previous year.
The Company has earned the Profit before Tax of Rs. 1108.73 lakhs during the year ended on 31st March, 2016 as compared to Rs. 961.96 lakhs earned during the previous year ended on 31st March, 2015, showing a rise of 15.26 %.
The Company has earned Net Profit of Rs. 714.82 lakhs for the year ended on 31st March, 2016 after making Provision for Tax Expenses of Rs. 393.91 lakhs and other adjustments, as compared to Net Profit of Rs. 620.24 lakhs earned by the Company during the previous year ended on 31st March, 2015, a rise of 15.25 %.
After adding the Surplus in the Statement of Profit & Loss of Rs. 4095.79 lakhs brought forward from the previous year to the profit of Rs. 714.82 lakhs earned by the Company during the year under review, the total amount of Rs. 4810.61 lakhs is available for appropriation.
DIVIDEND :
The Directors have recommended dividend of Rs. 2.20 per share (@ 22 %) on 50,70,240 Equity Shares of Rs. 10/- each of the Company for the Financial Year ended on 31st March, 2016, as compared to Dividend of Rs. 2.20 per share (@ 22.00%) declared for the previous Financial Year ended on 31st March, 2015. This will absorb Rs. 111.54 lakhs as against Rs..111.54 lakhs absorbed in the previous year. The corporate dividend tax payable by the Company on the said dividend will be Rs. 22.71 lakhs as against Rs. 22.71 lakhs in the previous year.
TRANSFER TO RESERVE:
After making appropriation for Dividend and Dividend Tax and other adjustments, the Company proposes to transfer Rs. 90.00 lakhs to General Reserve and amount of Rs. 4586.36 lakhs is proposed to be retained as the Surplus in the Statement of Profit and Loss.
EXTRACT OF ANNUAL RETURN:
Extract of Annual Return of the Company as required under Section 92(3) read with Section 134(3)(a) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, in the prescribed Form MGT-9, is annexed herewith as Annexure - A, to this Report.
MANAGEMENT DISCUSSION AND ANALYSIS:
In terms of provisions of Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Management Discussion and Analysis Report has been enclosed herewith as per Annexure - B and forming part of the Directors'' Report.
RECOGNITION OR AWARDS:
The Company''s products has ASME âUâ/ âU2â7 âSâ Stamp authorization. It is expected to improve profitability of the company in the future. For updating Heat Transfer Technology, Company has become member of HTRI (Heat Transfer Research, Inc, U.S.A.).
FINANCE:
During the year under review, the Relatives of the Promoters of the Company/Promoters Group brought in unsecured loan/deposits by way of contribution to bring additional long term funds as a part of conditions imposed by Bank of Baroda on the Promoters, while sanctioning additional working capital facilities to the Company vide its letter under Ref. No. NAVRAN:2014-15 dated 3rd April, 2015 and Letter No. NGZ/ACR/SME/JMJ/10 dated 7th July, 2015, which are exempted deposits under Rule 2(1)(c)(xiii) of Companies (Acceptance of Deposits) Rules, 2014.
During the year under review, the Company has also accepted deposits from the Directors of the Company which are exempted deposits under Rule 2(1 )(c)(viii) of Companies (Acceptance of Deposits) Rules, 2014, subject to compliance of the said Rules.
During the year under review, the Company has availed additional working capital facilities from Bank of Baroda, Navrangpura Branch, Ahmedabad, against the hypothecation and mortgage of movable and immovable properties of the Company. The Company has made regular repayment of Loan & interest and there is no any overdue payment to the said Bank.
In terms of the provisions of Investor Education and Protection Fund Rules, 2001 (IEPF), during the year under review, the Company has transferred the amount of unclaimed Dividend of Rs. 2,11,138/- for the year 2007-2008 (final dividend) to IEPF established by the Central Government under Section 124 of the Companies Act, 2013 and Rules made there under.
ACCEPTANCE OF DEPOSITS:
During the year under review, the Company has not accepted any deposits from the Public and Shareholders of the Company. As such, no amount of principal or interest was outstanding as of the Balance Sheet date.
SUBSIDIARY, ASSOCIATE OR JOINT VENTURE COMPANY:
The Company does not have any subsidiary, joint venture or associate companies within the meaning of Section 2(6) and 2(87) of the Companies Act, 2013. As such, a report in the prescribed Form AOC-1 as per first proviso to sub-section (3) of Section 129 of the Companies Act, 2013 and Rules made there under is not required to be attached and a Policy for determining material subsidiaries is not required to be framed by the Company.
CONSOLIDATED FINANCIAL STATEMENTS:
Since the Company does not have any subsidiary, joint venture or associate companies, Consolidated Financial Statements are not required to be prepared and attached with the financial statement of the Company pursuant to the requirements of Section 129 read with Schedule III of the Companies Act, 2013 and Rules made there under and Listing Regulations and applicable Accounting Standards.
CORPORATE GOVERNANCE:
Being a Listed Company, the Company has taken necessary measures to comply with the provisions of Listing Regulations regarding Corporate Governance and provisions of Clause 49 of erstwhile Listing Agreement with the Stock Exchange as amended from time to time. A separate report on Corporate Governance for the year ended on 31st March, 2016 is attached herewith as a part of this Annual Report viz Annexure - C. A certificate from Statutory Auditors of the Company regarding compliance of the aforesaid provisions of Corporate Governance is obtained by the Company and annexed to the Corporate Governance Report. The Auditors'' Certificate for the financial year 20152016 does not contain any qualification, reservation or adverse remark.
DIRECTORSâ RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the confirmation and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(C) and 134(5) of the Companies Act, 2013 and confirm that :
(a) in the preparation of the annual accounts for the year ended 31st March, 2016, 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 the year under review;
(c) the Directors had taken proper and sufficient 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 for the financial year ended on 31st March, 2016 on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and
(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.
PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED:
Particulars of loans given, investments made, guarantees given and securities provided by the Company under Section 186 of the Companies Act, 2013 are not provided, as during the year under review, the Company has not given any loan nor made any investment nor given any guarantee nor provided any security to any person.
RELATED PARTY TRANSACTIONS:
Information on transaction with related party referred to under sub-section (1) of Section 188 of the Companies Act, 2013 in the prescribed Form AOC-2 is attached herewith viz Annexure - D and forming part of the Directors'' Report pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014.
Transaction with related parties pursuant to the provisions of Listing Regulations and erstwhile Listing Agreement are disclosed in Note No. 28 of the Notes to the Financial Statements for the year ended on 31st March, 2016, in the Annual Report as required by the Accounting Standard (AS) 18 issued by ICAI.
However, there are no materially significant related party transactions made/entered into by the Company with its related parties including promoters, directors or the management etc. that may have potential conflict with the interests of the Company at large.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website viz. www.patelsairtemp.com.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
During the year under review, Mr. Girish N. Desai has resigned from the office of the Director of the Company with effect from 21st December, 2015. He was an Independent Director of the Company. He was also a member of Audit Committee of the Directors of the Company. The Directors placed on record the valuable services and guidance provided by Mr. Girish N. Desai during his tenure as an Independent Director of the Company and also as a member of the Audit Committee.
During the year under review, Mr. Devidas C. Narumalani ceased to be Whole-time Director of the Company w.e.f. 14th July, 2015 and continue as Non-executive & Non-independent Director of the Company.
Pursuant to the provisions of Section 149 and 152 1of the Companies Act, 2013 and Rules made there under and Listing Regulations and on the recommendation of the Nomination and Remuneration Committee, the Company proposes to appoint Mr. Himanshu N. Rawal (DIN: 06631728), who was appointed as Additional Director at the Board Meeting held on 13th February, 2016, as Independent Director of the Company, not liable to retire by rotation. The Company has received requisite notice in writing from a Member proposing his candidature for appointment as a Director of the Company. The aforesaid Independent Director, if appointed, shall hold office for a term of 2 consecutive years up to the conclusion of the 26th Annual General Meeting of the Company in the calendar year 2018.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Rules made there under, Mr. Narayanbhai G. Patel (DIN: 00023107), Chairman & Whole-time Director of the Company, shall retire by rotation at this Annual General Meeting and being eligible, offer himself for re-appointment, for which necessary resolution has been incorporated in the notice of the meeting. The Board of Directors recommends re-appointment of Mr. Narayanbhai G. Patel as a Director of the Company.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Rules made there under, Mr. Devidas C. Narumalani (DIN: 00097592), Non-executive & Non-independent Director of the Company, shall retire by rotation at this Annual General Meeting and being eligible, offer himself for re-appointment, for which necessary resolution has been incorporated in the notice of the meeting. The Board of Directors does not recommend re-appointment of Mr. Devidas C. Narumalani as a Director of the Company.
Mr. Narendra G. Patel (DIN: 00023205) has been re-appointed as Whole-time Director of the Company for further period of 3 years w.e.f. 2nd August, 2016 with payment of remuneration. Necessary resolution has been incorporated in the Notice of the Meeting seeking Members approval for the same.
The remuneration payable to (i) Mr. Narayanbhai G. Patel, Chairman & Whole-time Director, (2) Mr. Narendra G. Patel, Whole-time Director, (iii) Mr. Prakash N. Patel, Managing Director and (iv) Mr. Sanjiv N. Patel, Managing Director of the Company, has been increased from Rs. 1,80,000/- per month to Rs. 2,50,000/- per month with perquisites and allowances, subject to the approval of the shareholders, for which, necessary resolutions have been incorporated in the Notice of the Meeting seeking Members approval for the same.
The brief resume/details relating to the said Directors, who are to be re-appointed/appointed are furnished in the Notes to the Notice of the Annual General Meeting.
The Company has received declarations from all the Independent Directors of the Company in terms of Section 149(7) of the Act, confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 25 of SEBI Listing Regulations, 2015.
During the year under review, the designation of Mr. Karansingh I. Karki (ACS: 30021) changed from Company Secretary, being KMP to âAsst. Company Secretaryâ of the Company w.e.f. 13th February, 2016 and Mr. Nikhil M. Patel was appointed as Sr. Company Secretary, being Key Managerial Personnel (KMP) and Compliance Officer of the Company w.e.f. 13th February, 2016, as recommended by Nomination & Remuneration Committee of the Company.
BOARD EVALUATION :
The Board of Directors has carried out an annual evaluation of its own performance and that of its Committees and Directors pursuant to the provisions of Section 134(3)(p) of the Companies Act, 2013 and SEBI (Listing Obligation & Disclosure Requirement) Regulation, 2015. The performance of the Board and committees were evaluated by the Board on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. None of the independent directors are due for re-appointment.
In a separate meeting of independent Directors, performance of non-independent directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors and assessed 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.
COMMITTEES OF DIRECTORS :
The details of various Committees of Directors constituted by the Board of Directors under various provisions of Companies Act, 2013 and Rules made there under and Listing Regulations, Meetings & Attendance, terms of reference and other details are provided in the Corporate Governance Report annexed with the Directors'' Report.
The composition of various Committees and their terms of references may be accessed on the Company''s website viz. www.patelsairtemp.com.
POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION:
The Policy on appointment and remuneration of Directors, KMP and other employees and other matters as required under Section 178(3) of the Companies Act, 2013 is available on the web-site of the Company viz. www.patelsairtemp.com.
NUMBER OF BOARD MEETINGS :
During the financial year 2015-2016, 5 (Five) Board Meetings were held on 20/05/2015, 14/08/2015, 07/11/2015, 12/12/2015, & 13/02/2016. The gap between two Board Meetings did not exceed 120 days as prescribed in the Companies Act, 2013.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:
As required under Section 134(3)(m) of the Companies Act, 2013 and Rules made there under, details relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo are given in the Annexure - E attached herewith and forming part of the Directors'' Report.
RISK MANAGEMENT:
Business risk evaluation and management, covering the business operations of the Company, is an ongoing process within the Company and the management reviewed frequently risk assessment and to minimize them. The ultimate goal of risk management is the preservation of physical and human assets of the organization for successful continuation of its operations.
CORPORATE SOCIAL RESPONSIBILITY:
In terms of provisions of Section 135 of the Companies Act, 2013 and Rules made there under, a Committee of the Directors of the Company has been constituted as Corporate Social Responsibility (CSR) Committee. CSR Committee has formulated a policy on the Corporate Social Responsibility measures to be undertaken by the Company as specified in Schedule VII to the Companies Act, 2013.
The Company has duly spent the required amount during the financial year ended on 31st March, 2016 towards CSR activities. The Annual Report on CSR activities is annexed herewith marked as Annexure - F.
The Corporate Social Responsibility Policy is available on the Company''s web-site viz. www.patelsairtemp.com.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation were observed.
STATUTORY AUDITORS:
Section 139(2) of the Companies Act, 2013 (effective 1st April, 2014), mandates that a listed company or such other prescribed class of companies shall not appoint or re-appoint an audit firm as Statutory Auditors for more than two terms of five consecutive years each.
Further, the companies as aforesaid, whose Statutory Auditors has held office for a period of ten years or more are required to comply with these provisions, within three years from the date of commencement of these provisions i.e. 1st April, 2014. For this purpose, the term of the audit firm before the commencement of these provisions shall be taken into account for calculating the period of ten consecutive years.
Our auditors, M/s. Parikh & Majmudar, Chartered Accountants, Ahmedabad are holding the office as Statutory Auditors for more than ten years. Hence, they can only be re-appointed for a period up to three years i.e. up to Financial Year- 2016-2017.
The Audit Committee and the Board of Directors recommend the re-appointment of M/s. Parikh & Majmudar, Chartered Accountants, Ahmedabad as Statutory Auditors of the Company for the Financial year 2016-2017 to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting of the Company.
The Company has received a certificate from the said Auditors under Section 139 of the Companies Act, 2013 to the effect that their appointment, if made, would be within the prescribed limits under Section 139 of the Act and they are not disqualified under the Act. The Members are requested to consider their appointment as Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting of the Company.
The Auditors'' Report for the financial year 2015-2016 does not contain any qualification, reservation or adverse remark.
SECRETARIAL AUDITOR:
Section 204 of the Companies Act, 2013 and Rules made there under inter alia requires every listed companies to annex with its Board Report a Secretarial Audit Report given by a Company Secretary in practice in the prescribed form. The Board has appointed Mr. Punit Lath, Practicing Company Secretary, Ahmedabad to conduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016 is annexed herewith marked as Annexure -G to this Report.
The Secretarial Audit Report for the financial year 2015-2016 does not contain any qualification, reservation or adverse remark.
COST AUDIT:
Pursuant to the provisions of Section 148 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014 and as recommended by Audit Committee, the Board of Directors appointed M/s. Rajendra Patel & Associates, Cost Accountant, Ahmedabad, having Membership No. 29021 as the Cost Auditor of the Company to conduct audit of cost accounting records maintained by the Company for the current financial year 2016-2017 ending on 31st March, 2017. Further, the remuneration payable to M/s. Rajendra Patel & Associates for conducting the audit of cost records for the year ended 31st March, 2016 (2015-2016) and ending 31st March, 2017 (2016-2017) is required to be ratified by the Shareholders of the Company and resolution for the said ratification is placed for approval of the members at the ensuing AGM.
INSURANCE:
All insurable interests of the Company including buildings, plant and machinery, furniture & fixtures and other insurable interest are adequately insured.
LISTING AGREEMENT WITH STOCK EXCHANGES:
Pursuant to the provisions of Listing Regulations, the Company declares that the Equity Shares of the Company are listed on the BSE Limited (BSE). The Company has entered into new Listing Agreement with BSE Ltd. in terms of provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 within the prescribed time limit.
The Company confirms that it has paid Annual Listing Fees to BSE up to the Financial Year 2016-2017.
PARTICULARS OF EMPLOYEES:
The Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are enclosed with this report as Annexure - H.
The Statement of particulars of employees under Section 197(12) read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 is not provided with as, during the financial year under review, no employee of the Company including Whole-time Directors and Managing Directors were in receipt of remuneration in excess of the limits set out in the said rules.
WHISTLE BLOWER POLICY / VIGIL MECHANISM:
The Company has a Vigil mechanism and Whistle blower policy under which the employees are free to report any act of serious misconduct or wrongful activity being occurred or suspected to occur within the organization, to his immediate HOD or the HR Head or directly to the concern Whole-time Directors or Managing Directors of the Company, as he may desire. No employee of the Company is denied access to the Audit Committee. The vigil mechanism/whisle blower policy is also available on the website of the Company viz. www.patelsairtemp.com.
GENERAL:
- During the year under review, there was no change in the nature of business of the Company and there is no material change and/or commitments, affecting the financial position of the Company, during the period from 31st March, 2016 till the date of this report.
- During the year under review, there was no significant and/or material order passed by any regulators or courts or tribunals impacting the going concern status and company''s operations in future.
- The Company does not provide any loan or other financial arrangement to its employees or Directors or Key Managerial Personnel for purchase of its own shares and hence, the disclosure under Section 67(3)(c) of the Companies Act, 2013 does not require.
- The disclosure in terms of Rule 4 of Companies (Share Capital and Debenture) Rules, 2014 is not provided, as the Company does not have any equity shares with differential voting rights.
- The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules made there under.
ACKNOWLEDGEMENT:
The Directors place on record the appreciation and gratitude for the co-operation and assistance extended by various departments of the Union Government, State Government, Bankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere services of the employees of the Company at all levels.
The Company will make every effort to meet the aspirations of its Shareholders and wish to sincerely thank them for their whole hearted co-operation and support at all times.
By order of the Board of Directors
NARAYANBHAI G. PATEL
Chairman & Whole-time Director
Date : 28th May, 2016
Place : Ahmedabad
Mar 31, 2014
Dear Members,
The Directors have pleasure in presenting this 22nd Annual Report
together with the Audited Statements of Accounts for the year ended on
31st March, 2014.
FINANCIAL RESULTS:
(Rs. in Lacs)
Particulars 2013-14 2012-13
Sales and Other Income 7586.52 9919.23
(Including Excise Duties)
Profit before Interest 1014.53 1160.67
and Finance Charges
Depreciation and Taxes
& prior period Adjustment
Less : Interest & Finance Charges 119.22 271.97
Depreciation 171.69 152.71
Profit before Taxation 723.62 735.99
Provision for Taxation - Current 219.00 230.00
- Deferred 32.39 11.93
- Wealth Tax 1.01 0.80
- Short / (Excess) 3.60 0.58
Provision earlier
year W/O
- Short / (Excess) (0.04) (0.20)
Provision of
Wealth Tax
Profit after Tax 467.66 492.88
Less Prior Period Adjustment 1.21 (1.76)
Net Profit 466.45 494.64
Balance brought forward from 3508.43 3221.64
previous year
Less: Corporate Dividend Tax 16.45 16.45
Less: Proposed Dividend 101.41 101.41
Less: Transfer to General Reserve 90.00 90.00
Surplus carried forward to Balance Sheet 3767.02 3508.43
Earning Per Share 9.20 9.76
DIVIDEND
Your Directors are pleased to recommend payment of dividend for the
year ended March 31, 2014, Rs.2/- per Equity Share of the face value of
Rs.10/- (i.e. 20%) on 5070240 paid up Equity Shares, subject to
approval of shareholders at the Annual General Meeting. The Corporate
Dividend Tax works out to Rs.16.45 lacs.
PERFORMANCE
The slowing down in the economy has impacted the sales during the
fiscal year 2013-14. During the year under consideration, your
Company''s Net sales including export sales of Rs.7075.22 against
Rs.9057.95. Profit Before Tax is Rs.723.62 lacs as compared to the
previous year of Rs.735.99 lacs. The net Profit after tax at Rs. 466.45
lacs as compared to the previous year of Rs.494.64 lacs.
FUTURE PROSPECTS
As per the present policy of the Government of India & current
scenario, there is a thrust on development of various infrastructure
sectors and accordingly Government is continuously spending and
developing refineries, fertilizer projects & thermal power plant. There
is wide scope for the Company to supply the Capital goods equipments to
the Companies under this segment. As you are aware, your Company is
focusing on the business of manufacturing a range of shell and tube
Heat exchangers, Air cooled Heat Exchangers, Refrigeration and Air
Conditioning equipments, pressure vessels, etc. which broadly fall
under the category of capital goods. They have multifarious
applications in several industries.
Your Company has started focusing not only on the domestic market but
also on the international market and your directors are pleased to
inform the members that in the current fiscal year FY 2013-14 your
company has continued long term supply arrangements with a leading
global manufacturer of heat exchangers whereby your company has started
manufacturing and supplying heat exchangers to entered into after an
exhaustive audit of your Company''s facilities and capabilities and this
augurs very well for your company and it is a testimony that your
company''s facilities and capabilities are capable to meet very strict
international standards.
As you aware that the Company is in engineering industry and is engaged
in manufacturing/fabricating tailor made machines and therefore, the
order book position of such type of company can play pivotal role in
the growth of the Company. Your directors are pleased to state that
continuing the past trend; the Company is having confirmed orders of
about Rs.136.37 Lacs on hand as on 27th May,2014. Thus your directors
are quite bullish on repeating similar performance in future. Your
directors are cautious and making untiring efforts so as not to
compromise on growth, quality, and profitability of the Company.
DEPOSITS
The Company has not invited / accepted any deposits from the public
under the provisions of Section 58A of the Companies Act, 1956 and
rules made there under.
DIRECTORS
Shri Prakashbhai N. Patel and Shri Narendrabhai G. Patel, retire by
rotation and being eligible offer themselves for the reappointment.
Pursuant to Section 149 of the Companies Act, 2013, the Board at its
meeting held on 27 May, 2014 recommended appointment of Shri.
Harishkumar I. Shah (DIN 00216585), Shri. Vinodkumar C. Desai (DIN
02813402), Shri. Naimeshbhai B. Patel (DIN 002813295), Shri. Girishbhai
N. Desai (DIN 002824731) and Shri. Ramanbhai R. Patel (DIN 05224867) as
an Independent Directors of the Company, not liable to retire by
rotation for a period of five years from the date of its 22nd Annual
General Meeting subject to approval of the Members of the Company.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet with the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Companies Act, 2013 and under Clause 49 of the Listing Agreement
with the Stock Exchanges.
The particulars of the directors retiring by rotation are given in the
notice / explanatory statement portion of the accompanying notice.
CORPORATE GOVERNANCE
The Report on corporate governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
The requisite certificate from the Auditors of the Company confirming
compliance with the conditions of corporate governance as stipulated
under the aforesaid Clause 49, is attached to the Report on corporate
governance.
LISTING OF SECURITIES:
Your company''s Equity shares are listed on Bombay Stock Exchange Ltd.
(BSE). The Company has paid Annual Listing Fees for the year 2014-15 to
the Stock Exchange.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956 with respect to Directors'' Responsibility Statement, it is
hereby confirmed that:
(i) in preparation of the annual accounts, all the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that were 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 account of the Company for the year under review ;
(iii) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and preventing and detecting fraud and other irregularities
;
(iv) the Directors have prepared the Annual Accounts for the financial
year ended 31st March, 2014 on a ''going concern'' basis.
STATUTORY AUDITORS
M/s. Parikh & Majmudar, Chartered Accountants (Reg. No. 107525W),
Ahmedabad, Auditors of the Company hold office until the conclusion of
the ensuing Annual General Meeting. The Company has received a letter
to the effect that their appointment would be within the prescribed
limits under Section 141(3)(g) of the companies Act, 2013. The Board
hereby requests the members to reappoint M/s. Parikh & Majmudar,
Chartered Accountants, Ahmedabad as the Auditors of the Company from
the conclusion of this Annual General Meeting till the conclusion of
next Annual General Meeting.
Your Directors request you to appoint Auditors as proposed and as set
out in the accompanying notice of the Annual General Meeting
COST AUDITORS
In terms of Circular No. 52/26/CAB-2010 dated 24th January 2012
received from the Cost Audit Branch of the Ministry of Corporate
Affairs and pursuant to the provisions of section 224(1 B) read with
section 233B of the Companies Act, 1956, Rajendra Patel & Associates,
Cost Accountant, Ahmedabad, were appointed as the cost auditors of the
Company for the year ending 31st March, 2014.
Further, the Compliance Report in respect of the FY 2012-13 was filed
by the Cost Auditor in the XBRL mode in Form-A within the due date to
the Central Government.
PERSONNEL
There is no employee drawing remuneration for which information is
required to be submitted under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, hence not given.
VIGIL MECHANISM
In pursuant to the provisions of section 177(9) & (10) of the Companies
Act, 2013, a vigil mechanism for directors and employees to report
genuine concerns has been established.
CONSERVATION OF ENERGY
The main source of energy is power. However, power is not a major input
in the manufacturing process and therefore, no substantial conservation
of energy is possible. Again the Company is not required to give the
particulars in the prescribed Form A under Rule 2 of the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988.
RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION
The particulars as required under Section 217(1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to Research
& Development and Technology Absorption are given in Annexure to this
report.
CORPORATE SOCIAL RESPONSIBILITY
In pursuant to the provisions of section 135 and schedule VII of the
Companies Act, 2013, CSR Committee of the Board of Directors was formed
to recommend (a) the policy on Corporate Social Responsibility (CSR)
and (b) implementation of the CSR Projects or Programs to be undertaken
by the Company as per CSR Policy for consideration and approval by the
Board of Directors.
APPRECIATION
Your Directors wish to place on record their deep appreciation of the
continued support and guidance provided by the Central and State
Governments and all Regulatory bodies.
Your Directors also take opportunity to thanks the esteemed
shareholders, customers, business associates, and Company''s Banks for
the faith reposed by them in your Company and its management. Your
Directors place on record their deep appreciation of the dedication and
commitment of your Company''s employees at all levels and look forward
to their support in the future as well.
For and on behalf of the Board of Directors,
NARAYANBHAI G. PATEL
CHAIRMAN & MANAGING DIRECTOR
Place: Rakanpur
Date: 27th May, 2014
Mar 31, 2013
Dear Members, Patels Airtemp (India) Ltd.
The Directors have pleasure in presenting this 21st Annual Report
together with the Audited Statements of Accounts for the year ended on
31st March, 2013. Your Directors always try to maximize the value to
the share holders. We have maintained our tradition of coming forth
with high quality content and services. Our tradition in no way
inhibits our capacity for innovations.
As trustees of the Company, we share our vision of growth with you. Our
guiding principles are a blend of realism and optimism which has been
and will be the guiding force of all our future endeavours. The summary
of operating results for the year and appropriation of divisible
profits is given below:
FINANCIAL RESULTS:
(Rs.in Lacs)
Particulars 2012-13 2011-12
Sales and Other Income
(Including Excise Duties) 9919.23 8023.64
Profit before Interest and
Finance Charges 1160.67 1234.07
Depreciation and Taxes & prior
period Adjustment
Less : Interest & Finance Charges 271.97 305.03
Depreciation 152.71 132.62
Profit before Taxation 735.99 796.42
Provision for Taxation - Current 230.00 235.91
- Deferred 11.93 18.48
- Wealth Tax 0.80 0.90
- Short / (Excess) Provision of
earlier year W/O 0.58 1.26
- Short / (Excess) Provision
of Wealth Tax (0.20) (0.10)
Profit after Tax 492.88 539.97
Less Prior Period Adjustment (1.76) 3.87
Net Profit 494.64 536.10
Balance brought forward
from previous year 3221.64 2893.40
Less Corporate Dividend Tax 16.45 16.45
Less: Proposed Dividend 101.41 101.41
Less Transfer to General Reserve 90.00 90.00
Surplus carried forward to Balance Sheet 3508.43 3221.64
Earning Per Share 9.76 10.57
DIVIDEND
Your Directors are pleased to recommend payment of dividend for the
year ended March 31, 2013, X 2/- per Equity Share of the face value of
X 10/- (i.e. 20%) on 5070240 paid up Equity Shares, subject to approval
of shareholders at the Annual General Meeting. The Corporate Dividend
Tax works out to X. 16.45 lacs.
PERFORMANCE
During the year under consideration, your company achieved net sales
including export sales of X 9057.95 lacs as against X 7133.58 lacs for
the previous year. Profit Before Tax is 735.99 lacs against X 796.42
lacs during the previous year. The net Profit after tax at X 494.64
lacs as compared to the previous year of X 536.10 lacs.
FUTURE PROSPECTS
As you are aware, your Company is focusing on the business of
manufacturing a range of shell and tube Heat exchangers, Air cooled
Heat Exchangers, Refrigeration and Air Conditioning equipments,
pressure vessels, etc. which broadly fall under the category of capital
goods. They have multifarious applications in several industries.
Your Company has started focusing not only on the domestic market but
also on the international market and your directors are pleased to
inform the members that in the current fiscal year FY 2012-13 your
company has entered into a long term supply arrangements with a leading
global manufacturer of heat exchangers whereby your company has started
manufacturing and supplying heat exchangers to entered into after an
exhaustive audit of your Company''s facilities and capabilities and this
augurs very well for your company and it is a testimony that your
company''s facilities and capabilities are capable to meet very strict
international standards.
As you aware that the Company is in engineering industry and is engaged
in manufacturing/fabricating tailor made machines and therefore, the
order book position of such type of company can play pivotal role in
the growth of the Company. Your directors are pleased to state that
continuing the past trend; the Company is having confirmed orders of
about Rs.40 Crores on hand as on 29th May,2013. Thus, inspite of the
economic slow down, your directors are confident of repeating similar
growth in line with the past trend for fiscal year 2013-14. However,
your directors are cautious and making untiring efforts so as not to
compromise on growth, quality, and profitability of the Company.
DEPOSITS
The Company has not invited / accepted any deposits from the public
under the provisions of Section 58A of the Companies Act, 1956 and
rules made there under.
DIRECTORS
Shri Narayanbhai G. Patel, Shri Devidas C. Narumalani and Shri
Hareshkumar I Shah, retire by rotation and being eligible offer
themselves for the reappointment. Your directors has approved in its
board meeting held on 29/05/13, re-appointment of Shri Prakashbhai N.
Patel & Shri Narendrabhai G. Patel as Whole Time Directors of the
Company for further period of three years from 02/06/13 to 01/06/16 &
02/08/13 to 01/08/16 respectively on terms and conditions as mentioned
in Notice of the forthcoming Annual General Meeting.
The particulars of the directors retiring by rotation are given in the
notice / explanatory statement portion of the accompanying notice.
CORPORATE GOVERNANCE
The report on Corporate Governance as per Clause 49 of the Listing
Agreement is annexed herewith.
LISTING OF SECURITIES:
Your company''s Equity shares are listed on Bombay Stock Exchange Ltd.
(BSE). The Company has paid Annual Listing Fees for the year 2013-14 to
the Stock Exchange.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956 with respect to Directors'' Responsibility Statement, it is
hereby confirmed:
(i) that in preparation of the annual accounts, all the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) that the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
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 account of the Company for the year under review;
(iii) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and preventing and detecting fraud and other irregularities
;
(iv) that the Directors have prepared the Annual Accounts for the
financial year ended 31st March, 2013 on a ''going concern'' basis.
STATUTORY AUDITORS
M/s. Parikh & Majmudar, Chartered Accountants (Reg. No. 107525W),
Ahmedabad, Auditors of the Company hold office until the conclusion of
the ensuing Annual General Meeting. The Company has received a letter
to the effect that their appointment would be within the prescribed
limits under Section 224(1-B) of the companies Act, 1956. The said
auditors will be appointed as auditors of the Company at the ensuing
Annual General Meeting. The notes to the accounts referred to in the
Auditors'' Report are self explanatory and therefore do not call for any
further comments.
Your Directors request you to appoint Auditors as proposed and as set
out in the accompanying notice of the Annual General Meeting.
COST AUDITORS
Pursuant to Section 233-B of the Companies Act, 1956 and Circular No. F
No. 52/26/cab-2010 dated 24.01.2012 issued by the Ministry of Corporate
affairs, Cost Audit Branch ordering the Cost Audit of the Listed
Companies for its "Engineering machinery (including electrical &
electronic product)" every year. Hence to comply the said Circular, the
Company has re-appointed M/s. Rajendra Patel and Associates, Ahmedabad
as a Cost Accountant for the year 2013-14. The Company has received a
letter to the effect that their appointment would be within the
prescribed limits under Section 224(1-B) of the companies Act, 1956.
The Report will be submitted to the Central Government on or before the
due date.
PERSONNEL
There is no employee drawing remuneration for which information is
required to be submitted under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, hence not given.
CONSERVATION OF ENERGY
The main source of energy is power. However, power is not a major input
in the manufacturing process and therefore, no substantial conservation
of energy is possible. Again the Company is not required to give the
particulars in the prescribed Form A under Rule 2 of the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988.
RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION
The particulars as required under Section 217(1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to Research
& Development and Technology Absorption are given in Annexure to this
report.
APPRECIATION
Your Directors wish to place on record their deep appreciation of the
continued support and guidance provided by the Central and State
Governments and all Regulatory bodies.
Your Directors also take opportunity to thanks the esteemed
shareholders, customers, business associates, and Company''s Banks for
the faith reposed by them in your Company and its management.
Your Directors place on record their deep appreciation of the
dedication and commitment of your Company''s employees at all levels and
look forward to their support in the future as well.
For and on behalf of the Board of Directors,
Place: Rakanpur
Date: 29th May, 2013 NARAYANBHAI G. PATEL
CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2012
The Directors have pleasure in presenting this 20th Annual Report
together with the Audited Statements of Accounts for the year ended on
March 31, 2012. Your Directors always try to maximize the value to the
share holders. We have maintained our tradition of coming forth with
high quality content and services. Our tradition in no way inhibits our
capacity for innovations.
As trustees of the Company, we share our vision of growth with you. Our
guiding principles are a blend of realism and optimism which has been
and will be the guiding force of all our future endeavours. The summary
of operating results for the year and appropriation of divisible
profits is given below:
FINANCIAL RESULTS: (Rs in Lacs)
Particulars 2011-12 2010-11
Sales and Other Income (Including Excise Duties) 8023.64 8475.60
Profit before Interest and Finance Charges 1234.07 1617.74
Depreciation and Taxes & prior period Adjustment
Less : Interest & Finance Charges 305.03 177.33
Particulars 2011-12 2010-11
Depreciation 132.62 110.04
Profit before Taxation 796.42 1330.37
Provision for Taxation - Current 235.91 417.71
- Deferred 18.48 24.27
- Wealth Tax 0.90 0.70
- Short / (Excess) Provision of earlier
year W/O 1.26 (0.50)
- Short / (Excess) Provision of
Wealth Tax (0.10) (0.15)
Profit after Tax 539.97 888.34
Less : Prior Period Adjustment 3.87 0.90
536.10 887.44
Balance brought forward from previous year 2893.39 2214.20
Less : Corporate Dividend Tax 16.45 16.84
Less : Proposed Dividend 101.41 101.41
Less : Transfer to General Reserve 90.00 90.00
Surplus carried forward to Balance Sheet 3221.63 2893.39
Earning Per Share 10.57 17.50
DIVIDEND
Your Directors has recommended dividend @ 20% i.e. Rs.2/- per Equity
Share for the year 2011-12 subject to the approval of members in the
General Meeting. The Corporate Dividend Tax works out to Rs 16.45 lacs.
PERFORMANCE
The performance of your company for the fiscal year 2011-12 was
impacted partly owing to the rising cost of inputs and partly owing to
the dull sentiments prevailing in the capital goods sector in the
industry. Net sales inclusive of Exports of the Company is Rs 7133.58
against Rs 7802.29 lacs of the previous year. Profit Before Tax is Rs
796.42 lacs against Rs 1330.37 lacs during the previous year. Net Profit
of the Company is Rs 536.10 lacs against Rs 887.44 lacs during the
previous year.
FUTURE PROSPECTS
As you are aware, your Company is focusing on the business of
manufacturing a range of shell and tube Heat exchangers, Air cooled
Heat Exchangers, Refrigeration and Air Conditioning equipments,
pressure vessels, etc. which broadly fall under the category of capital
goods. They have multifarious applications in several industries.
Your Company has started focusing not only on the domestic market but
also on the international market and your directors are pleased to
inform the members that in the current fiscal year FY 2012-13 your
company has entered into a long term supply arrangements with a leading
global manufacturer of heat exchangers whereby your company has started
manufacturing and supplying heat exchangers to entered into after an
exhaustive audit of your Company's facilities and capabilities and this
augurs very well for your company and it is a testimony that your
company's facilities and capabilities are capable to meet very strict
international standards.
On an average your company expects to export heat exchangers valued at
around Rs 20/- crores per annum. Further in the current year, the
domestic demand has also revived and as of June, 2012 your company's
order book position was quite healthy and it has stood at Rs 72/- crores
which included domestic orders of Rs 62/- crores and export order of Rs
10/- crores. Going forward, your company expects to sustain a
reasonably good growth rate in future both in the domestic market as
well as in the export market.
DEPOSITS
The Company has not invited / accepted any deposits from the public
under the provisions of Section 58A of the Companies Act, 1956 and
rules made there under.
DIRECTORS
Shri Sanjiv kumar N. Patel, Shri Naimeshbhai B. Patel and Shri
Vinodkumar C. Desai, retire by rotation and being eligible offer
themselves for the reappointment. Your Directors has approved in its
Board meeting held on 11th February, 2012, appointment of Shri
Ramanbhai Patel as Additional Director of the Company w.e.f. 11th
February, 2012. Your directors has approved in its board meeting held
on 26th May, 2012, appointment of Shri Devidas C. Narumalani as Whole
Time Director of the Company for further period of three years from
14th July, 2012 to 13th July, 2015 on terms and conditions as mentioned
in Notice of the forthcoming Annual General Meeting.
The particulars of the directors retiring by rotation are given in the
notice / explanatory statement portion of the accompanying notice.
CORPORATE GOVERNANCE
The report on Corporate Governance as per Clause 49 of the Listing
Agreement is annexed herewith.
LISTING OF SECURITIES:
Your company's Equity shares are listed on Bombay Stock Exchange Ltd.
(BSE). The Company has paid Annual Listing Fees for the year 2012-13 to
the Stock Exchange.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956 with respect to Directors' Responsibility Statement, it is
hereby confirmed:
(i) that in preparation of the annual accounts, all the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) that the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
reasonable and prudent so as to give a true and fairview of the state
of affairs of the company at the end of the financial year and of the
profit and loss account of the Company for the year under review ;
(iii) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and preventing and detecting fraud and other
irregularities;
(iv) that the Directors have prepared the Annual Accounts for the
financial year ended 31st March, 2012 on a 'going concern' basis.
STATUTORY AUDITORS
M/s. Parikh & Majmudar, Chartered Accountants, Ahmedabad, Auditors of
the Company hold office until the conclusion of the ensuing Annual
General Meeting. The Company has received a letter to the effect that
their appointment would be within the prescribed limits under Section
224(1-B) of the companies Act, 1956. The said auditors will be
appointed as auditors of the Company at the ensuing Annual General
Meeting. The notes to the accounts referred to in the Auditors' Report
are self explanatory and therefore do not call for any further
comments.
Your Directors request you to appoint Auditors as proposed and as set
out in the accompanying notice of the Annual General Meeting.
COST AUDITORS
Pursuant to Section 233-B of the Companies Act, 1956 and Circular No.
F No. 52/26/cab-2010 dated 24.01.2012 issued by the Ministry of
Corporate affairs, Cost Audit Branch ordering the Cost Audit of the
Listed Companies for its "Engineering machinery (including electrical &
electronic product)" every year. Hence to comply the said order, the
Company has appointed M/s. Rajendra Patel and Associates, Ahmedabad as
a Cost Accountant for the year 2012-13. The Company has received a
letter to the effect that their appointment would be within the
prescribed limits under Section 224(1-B) of the companies Act, 1956.
The Report will be submitted to the Central Government on or before the
due date.
PERSONNEL
There is no employee drawing remuneration for which information is
required to be submitted under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, hence not given.
CONSERVATION OF ENERGY
The main source of energy is power. However, power is not a major input
in the manufacturing process and therefore, no substantial conservation
of energy is possible. Again the Company is not required to give the
particulars in the prescribed Form A under Rule 2 of the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988.
RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION
The particulars as required under Section 217(1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to Research
& Development and Technology Absorption are given in Annexure to this
report.
APPRECIATION
Your Directors wish to place on record their deep appreciation of the
continued support and guidance provided by the Central and State
Governments and all Regulatory bodies.
Your Directors also take opportunity to thanks the esteemed
shareholders, customers, business associates, and Company's Banks for
the faith reposed by them in your Company and its management.
Your Directors place on record their deep appreciation of the
dedication and commitment of your Company's employees at all levels and
look forward to their support in the future as well.
For and on behalf of the Board of Directors,
Place: Rakanpur
Date: 26.05.2012 NARAYANBHAI G. PATEL
CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2010
The Directors are pleased to present the Eighteenth Annual Report
together with Audited Statement of Accounts of the Company for the
financial year ended 31st March, 2010.
FINANCIAL RESULTS (Rupees in Lacs)
Particulars 2009-10 2008-09
Sales and Other Income (Including Excise Duties) 7760.41 7429.09
Profit before Interest and Finance Charges 1548.10 1272.81
Depreciation and Taxes & prior period Adjustment
Less : Interest & Finance Charges 134.06 108.86
Depreciation 87.77 66.18
Profit before Taxation 1326.27 1097.77
Provision for Taxation - Current 415.20 373.00
- Fringe Benefit Tax 0.00 3.80
- Deferred 34.66 (0.11)
- Wealth Tax 0.35 0.17
- Short/ (Excess) Provision of FBT 0.00 (0.42)
of earlier year w/o
- Short/(Excess) Provision earlier 7.59 4.96
Year w/o
Profit after Tax 868.47 716.37
Less Prior Period Adjustment 0.56 1.88
867.91 714.49
Balance brought forward from previous year 1554.94 1022.22
Less Corporate Dividend Tax 17.23 15.51
Less Interim Dividend - -
Less:Proposed Dividend 101.41 91.26
Less Transfer to General Reserve 90.00 75.00
Surplus carried forward to Balance Sheet 2214.21 1554.94
Earning Per Share 17.12 14.09
DIVIDEND
Your Directors has recommended dividend @ Rs.2/- per Equity Share for
the financial year 2009-10 subject to approval by the members in the
General Meeting. The Corporate Dividend Tax works out to be Rs. 17.23
Lacs.
PERFORMANCE
Your company continued to post good performance during the year. Profit
Before Tax is Rs.1326.27 lacs against Rs. 1097.77 lacs during the
previous year. Net sales of the Company are Rs. 7223.20 lacs against
Rs. 6844.65 Lacs of the previous year.
Your company has earned Net Profit of the Company is Rs. 867.91 lacs
against Rs. 714.49 lacs during the previous year showing an increase of
about 21%. Thus there is remarkable growth in the top line as well as
bottom line of the Company for the year under review.
FUTURE PROSPECTS
As you aware that the Company is in engineering industry and is engaged
in manufacturing/fabricating tailor made machines and therefore, the
order book position of such type of company can play pivotal
role in the growth of the Company. Your directors are pleased to state
that continuing the past trend; the Company is having confirmed orders
of about Rs.58 Crores on hand as on 22nd May,2010. Thus, inspite of the
general slow down, your directors are confident of repeating similar
growth inline with the past trend for fiscal year 2010-11. However,
your directors are cautious and making untiring efforts so as not to
compromise on growth, quality, and profitability of the Company.
As per the present policy of the Government of India, there is a thrust
on development of various infrastructure sectors and accordingly
Government is continuously spending and developing refineries,
fertilizer projects, thermal power plant and nuclear power plant. There
is wide scope for the Company to supply the Capital goods equipments to
the Companies under this segment. Thus the Company can supply
equipments like Shell & Tube heat Exchangers, Pressure Vessels &
Columns, Air Cooled Heat Exchangers and Air Conditioning and
Refrigeration equipments to this segment. Thus your directors are quite
bullish on repeating similar performance in future.
DEPOSITS
The Company has not invited / accepted any deposits from the public
under the provisions of Section 58A of the Companies Act, 1956 and
rules made there under.
DIRECTORS
Shri Narendrabhai G.Patel, Shri Devidas C. Narumalani and Shri
Prakashbhai N. Patel, who retire by rotation and being eligible, offer
themselves for the re-appontment.
Shri Narimishbhai Patel, Shri Vinodkumar Desai, and Shri Girishbhai
Desai have been appointed as Additional Director of the Company with
effect from 30th October, 2009.Their appointment as Director is
proposed in ensuing Annual General Meeting.
The Board of Director has in their meeting held on 22nd May, 2010
approved the re-appointment of Shri Prakashbhai N.Patel and Shri
Narendrabhai Patel for further period of 3 years subject to approval of
ensuing Annual General Meeting.
CORPORATE GOVERNANCE
The report on Corporate Governance as per Clause 49 of the Listing
Agreement is annexed herewith.
LISTING OF SECURITIES
Your Companys equity shares are listed on Bombay Stock Exchange
Ltd.The Company has paid Annual Listing fees for the year 2010-11 to
the Bombay Stock Exchange Ltd.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956 with respect to Directors Responsibility Statement, it is
hereby confirmed:
(i) that in preparation of the annual accounts, all the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(ii) that the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
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 account of the Company for the year under review ;
(iii) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and preventing and detecting fraud and other irregularities;
(iv) that the Directors have prepared the Annual Accounts for the
financial year ended 31st March, 2010 on a going concern basis.
AUDITORS
M/S. Parikh & Majmudar having Registration Number 107525W, Chartered
Accountants, Ahmedabad, Auditors of the Company hold office until the
conclusion of the ensuing Annual General Meeting. The Company has
received a letter to the effect that their appointment would be within
the prescribed limits under Section 224(1-B) of the companies Act,
1956. The said auditors will be re-appointed as auditors of the Company
at the ensuing Annual General Meeting. The notes to the accounts
referred to in the Auditors Report are self explanatory and therefore
do not call for any further comments.
Your Directors request you to appoint Auditors for the current year as
set out in the accompanying notice of the Annual General Meeting.
PERSONNEL
There is no employee drawing remuneration for which information is
required to be submitted under Section 217(2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 as
amended, hence not given.
CONSERVATION OF ENERGY
The main source of energy is power. However, power is not a major input
in the manufacturing process and therefore, no substantial conservation
of energy is possible. Again the Company is not required to give the
particulars in the prescribed Form A under Rule 2 of the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988.
RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION
The particulars as required under Section 217(1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 with respect to Research
& Development and Technology Absorption are given in Annexure to this
report.
FOREIGH EXCHANGE EARNINGS & OUTGO
The information on foreign exchange earning and outgo during the year
is furnished in the Notes to the Accounts.
APPRECIATION
Your Directors wish to place on record their deep appreciation of the
continued support and guidance provided by the Central and State
Governments and al Regulatory bodies.
Your Directors also take opportunity to thanks the esteemed
shareholders, customers, business associates, Financial Institutions
and Commercial Banks for the faith reposed by them in your Company and
its management.
Your Directors place on record their deep appreciation of the
dedication and commitment of your Companys employees at all levels and
look forward to their support in the future as well.
For and on behalf of the Board of Directors,
Place : Rakanpur NARAYANBHAI G. PATEL
Date : 22nd May, 2010 Chairman & Managing Director
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