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Automotive Stampings & Assemblies Ltd.

BSE: 520119 Sector: Auto
NSE: ASAL ISIN Code: INE900C01027
BSE 00:00 | 24 Apr 2020 Automotive Stampings & Assemblies Ltd
NSE 05:30 | 01 Jan 1970 Automotive Stampings & Assemblies Ltd

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OPEN 17.96
52-Week high 62.75
52-Week low 11.80
Mkt Cap.(Rs cr) 28
Buy Price 18.00
Buy Qty 100.00
Sell Price 17.96
Sell Qty 4949.00
OPEN 17.96
CLOSE 18.90
52-Week high 62.75
52-Week low 11.80
Mkt Cap.(Rs cr) 28
Buy Price 18.00
Buy Qty 100.00
Sell Price 17.96
Sell Qty 4949.00

Automotive Stampings & Assemblies Ltd. (ASAL) - Director Report

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Company director report

Dear Members

Your Directors take pleasure in presenting the Twenty Ninth AnnualReport together with the Audited
Financial Statements of your Company for the financial year ended March 312019. TheManagement
Discussion and Analysis forms part of this Report.


(र' in Lakhs)


Financial Year

2018-19 2017-18
Revenue from Sale of Products / Services (Net) 48127.53 33055.34
Other Operating Revenue 39.71 24.43
Other Income 199.11 4.56
Total Revenue 48366.35 33084.33
Cost of Materials Consumed (including change in inventories) 36186.49 26060.56
Employee Benefit Expense 3750.00 3468.36
Other Expenses 7066.90 6060.29
Earnings / (Loss) before Depreciation Financial Charges and Tax
1362.96 (2504.88)
Finance cost 1650.05 1147.84
Depreciation and Amortization Expense 975.66 1003.37
Profit / (Loss) before exceptional item and Tax (1262.75) (4656.08)
Exceptional items - -
Tax Expense / (Credit) - -
Profit/ (Loss) for the year (1262.75) (4656.08)
Other Comprehensive Income (OCI) (1.29) 8.17
Total Comprehensive Income/ (loss) (net of taxes) (1264.04) (4647.91)


Due to the loss during the year the Board of Directors of the Companyhas not recommended any dividend.

Due to the loss during the year your Company has not transferred anyamount to General Reserve
Account under the Companies Act 2013.


The paid up Equity Share Capital as at March 312019 was र 1586.44Lakhs comprising of 15864397
equity shares of '10 each. During FY 2018-19 your Company has neither issued any shareswith
differential voting rights nor has granted any stock options or sweat equity. As on March312019 none of
the Directors or the Key Managerial Personnel of the Company holds instruments convertibleinto equity
shares of the Company.


The Indian Automobile Industry is made up of Original EquipmentManufacturers (OEMs) i.e. Automobile
manufacturers and auto component manufacturers.

The Automobile Industry is a growing sector in India with global majorshaving set up their facilities here.
The Industry has been continually evolving and absorbing newer technologies in order toalign itself with
global developments.

India is expected to emerge as the world's third-largestpassenger-vehicle (currently at 4th position)
market by 2021. It took India around seven years to increase annual production to fourmillion vehicles
from three million vehicles. However the next milestone five million is expected in lessthan five years.
Hitting that mark will depend on today's rapid economic development continuing with aprojected annual
GDP growth rate of 7 percent through 2020 ongoing urbanization a burgeoning consumingclass and
supportive regulations and policies.

The Auto Components Industry in India comprises of Tier Onemanufacturers who supply complete
component modules to OEMs Tier Two manufacturers who cater to Tier One manufacturers andTier
Three manufacturers who supply components to Tier Two manufacturers. The Industry isdivided into five
segments viz. engine parts transmission drive & steering parts suspension &brake parts electric parts
and body & chassis. The fortunes of the Auto Components Industry are closely linkedwith those of the
OEMs and must be agile to adopt the changes in technology. Apart from this it has tocontinuously raise
the quality and delivery performance in stride with the requirements of OEMs.

Auto component manufacturers would need to keep pace with the changingneeds of automotive OEMs
who in turn are coping with the dynamic expectations of the end customer consolidation ofplatforms to
reduce complexity and cost. These trend includes:

a) Constantly shifting market dynamics due to changing customerdemands and operating models.

b) The changing needs of OEMs who are likely to want different moreagile and just in time deliveries.

c) An evolving regulatory and trade environment forming the backdropfor it all.

In FY 2018-19 Auto Industry witnessed a growth of 6.26 per cent. ThePassenger Vehicle segment
registered a meager growth of 0.14 per cent which includes passenger car vehicles andutility vehicles.
Within this segment the Utility vehicle market grew at 0.48 per cent and Van segment grewat 20.61 per
cent whereas the Passenger Car segment recorded a negative growth of 1.33 per cent. TheCommercial
Vehicle segment grew by 24.20 per cent driven by M&HCV segment which grew by 28.91 percent and
LCV segment grew by 21.26 per cent. The Two wheeler segment registered a growth of 5.82per cent
whereas the three wheeler segment registered a growth of 24.12 per cent.

GDP growth of Indian economy is estimated to be around 7.2 per cent.(Source: RBI)

The chart given below shows the production of various categories ofvehicles during FY2018-19 vis-a-vis

Segment FY2018-19 FY2017-18

% Growth

Passenger cars 2710057 2746658


Utility vehicles 1098578 1093346


Vans 217412 180263


Passenger Vehicles 4026047 4020267


M&HCVs 444202 344592


LCV 667974 550856


Commercial vehicles 1112176 895448


Three Wheelers 1268723


Two wheelers 24503086


Quadricycle 5388


Total of All Categories 30915420



Source SIAM report

The Indian Auto Components Ancillary Industry continues to face adverseheadwinds to maintain volumes
and margins. Your Company operates in Sheet Metal Components Assemblies andSub-assemblies
segment of the Auto Components Industry. It manufactures a range of sheet metal componentsand
assemblies for the Automobile Industry and is a Tier One auto components supplier.


During the period under review your Company has four manufacturingfacilities at Bhosari Chakan - Pune
(Maharashtra) Halol (Gujarat) and Pantnagar (Uttarakhand).

During the period under review your Company has;

a) Shifted its Registered Office with effect from December 28 2018 forbetter administrative control
from ‘G-71/2 MIDC Industrial Area Bhosari Pune: 411026 Maharashtra India' to‘TACO House
Plot No- 20/B FPN085 V.G. Damle Path Off Law College Road Erandwane Pune: 411004
Maharashtra India'.

b) Shifted manufacturing operations located at Bhosari in order toachieve operational efficiency
and productivity improvements from ‘G-71/2 MIDC Industrial Area Bhosari Pune:411026
Maharashtra India' to new leased premises located at ‘Survey No. 679/2/2 AlandiRoad Kuruli
Chakan Taluka - Khed District- Pune: 410 501 Maharashtra India'.

The Board of Directors of your Company vide Resolution dated January15 2019 approved transfer
of rights in the leasehold land along with building located at G-71/2 MIDC IndustrialArea Bhosari
Pune: 411026 Maharashtra subject to necessary approvals from concerned authorities and
accordingly entered into Memorandum of Understanding (MOU) wrt aforesaid transaction. Your
Company is in process of getting various approvals from concerned authorities includingMIDC
permission and the said approval is expected to be received shortly.

Your Company's sales showed substantial improvement during the currentfinancial year on account
of new launches of models by OEMs which is partially offset due to decline in sales ofolder models.

During FY 2018-19 your Company has received additional business fromOEMs in Passenger
Vehicle / Utility Vehicle Segment and Commercial Vehicles Segment. Sales of your Companyhas
grown due to ramp up of new businesses and higher off take from key customers. Thereforethe
capacity utilization of your Company was better as compared to last year. During thefinancial
year 2018-19 the manufacturing costs increased due to increase in sales and change inproduct
mix. However to minimize the impact your Company has taken various cost reductioninitiatives
to enhance productivity and improve operational efficiencies. The Management is confidentthat
the cost reduction initiatives and operational efficiencies are sustainable. Your Companyhas been
aggressively managing its net working capital and was able to keep it under control.

Apart from the cost reduction programmes your Company has beenaggressively pursuing new business
opportunities in Utility Vehicle segment Commercial Vehicles Segment both in Heavy andLight Commercial
Vehicles and Three Wheeler Segment by targeting greater share of business from existingCustomers.
This will not only increase the sales but also will help to reduce the dependency on onesegment resulting
in reducing overall risk.

Your Company is focused on achieving volume growth reduction in costsand improving product portfolio.
These measures will continue to drive improvement in your Company's business. Your Companyis
exploring opportunities to participate in LCV and M & HCV segment by pursuing newbusiness opportunities
with existing and new Customers.

Further your Company is also working with Customers for supplyingproducts in off -road segment.

During the year under review the net Sales increased by 45.61 per centto र 48167.24 Lakhs as compared
to previous year primarily due to increase in Customer volumes in few models leading tohigher component
tooling sales and services. Other operating income increased from र 24.43 Lakhs toर 39.71 Lakhs. Other
income mainly consists of refund of GST under Budgetary Support Scheme of र 108.70Lakhs gain on
sale of assets of र 44.75 Lakhs foreign exchange gain (net) of र 18.81 Lakhsand interest income of '
23.84 Lakhs.

Cost of materials consumed (including change in stock) as a percentageto sales decreased by 3.65
per cent to 75.12 per cent due to various cost reduction initiatives undertaken by yourCompany like
negotiations with customers and vendors blank optimisation increase in CTS (Cut to Size)Coil ratio and
change in the product mix. The Management has been taking continuous steps to improvematerial yield.

Employee benefits expense increased by 8.12 per cent as compared toprevious year due to changes in
manpower requirements and introduction of new Programmes by OEMs.

Other Expenses comprising Administration and Selling Expenses haveincreased to र 7066.90 Lakhs
largely due to increase in costs related to rent and leasing logistic costs freight andforwarding charges
rates and taxes power and fuel packing materials machinery repairs and maintenanceconsultancy fees
etc. During FY 2018-19 Finance cost increased to र 1650.05 Lakhs due to increasedborrowings.

Your Company is taking various initiatives on productivity improvementsand cost reduction Programmes.

Key Financial Ratios

Ratios 31.3.2019 31.3.2018 % CHANGE
1 Debtors Turnover 12.06 10.49 15%
2 Inventory Turnover 26.92 31.32 (14%)
3 Interest Coverage Ratio 0.83 (2.18) 138%
4 Current Ratio 0.51 0.41 23%
5 Debt Equity Ratio 6.98 5.64 24%
6 Operating Profit Margin (%) 0.80% (10.61%) 108%
7 Net Profit Margin (%) (2.62%) (14.08%) 81.37%
8 Return on Net Worth (%) (30.39%) (161.05%) 81.13%


1. Increase in EBDIT resulted in better interest coverage ratio in FY18-19 as compared to FY 17-18.

2. During the year under review the net Sales increased by 45.61 percent as compared to previous
year primarily due to increase in Customer volumes in few models leading to highercomponent
tooling sales and services. This led to better utilisation of resources resulting inbetter operating
profit margin reduction in loss and thus improved net profit margin in FY 18-19 ascompared to FY

3. Increase in EBT resulted in better net profit margin in FY 18-19 ascompared to FY 17-18.

4. The net worth has substantially improved by 81.13% in the FY 18-19due to reduction in losses in
comparison to FY 17-18.


• Investment in Technology / Process:

To meet the Customer's expectations it is important for the automotiveindustry to continuously
upgrade its technology and processes. Your Company is also upgrading its technology toparticipate
in new vehicle programmes launched by Customers. Your Company has invested in automationin
Weld Shop for various new programmes especially at Chakan plant.

The auto industry is growing moderately and the major customers of yourCompany have launched
new models in the market to regain position in their respective segments.

The profitability of the Indian Auto Components Industry is likely tocontinue to be subdued due to
pricing pressures from OEMs.

• Company's own technology / processes / system improvementplan:

Your Company is undertaking various new technology initiatives processupgradation and system
enhancements like installation of Robotic Welding Lines for new Customer programmes atChakan
and Pantnagar plants

During the year under review you Company has initiated the process ofmigration and up gradation
of its current SAP version to latest version "SAP S/4 HANA". SAP S/4 HANA is acombination of
Database Hardware and Software for fast & quick computation. Migrating to the SAP S/4HANA
will allow your Company for a digital transformation The same is expected to ‘golive' in FY 2019-20.

Programme Management for new Projects is being tracked through‘SAP - Programme Management
Module'. This will further improve the productivity and potential for acquiring newbusinesses from
existing and new customers. This will not only enhance the capacity utilisation but alsobroaden the
customer base and introduction into new business segments.


Your Company operates only in the Automobile Component Segment in theDomestic Market.


According to outlook of SIAM in FY 2019-20 passenger vehicle salesare projected to grow between 3-5
per cent and commercial vehicle at 10-12 per cent. The three wheeler segment is pegged togrow between 7-9 per cent.

It is expected that PV segment will witness muted growth postponementof purchases and pessimistic
consumer sentiment. LCVs Segment is expected to grow in FY 19-20 due to replacement demandof old
vehicles. MHCV segment in FY 19-20 is expected to be impacted by revised Axle normincreasing freight
capacity weak demand and expected lower diesel prices. Driving this growth will beoverall infrastructure
and Gross domestic product that is estimated to grow at 7 perc ent during FY20. Otherreason cited for
growth are pre-buying of BS-IV vehicles in FY20 before BS-VI implementation and severalnew launches
in the current fiscal year. Auto Industry growth story will likely to remain intact withGDP growth outlook
and infrastructure expenditure.

However despite positive outlook projections key concerns relate tobelow normal monsoons rise in
commodity price recent repo rate cut by RBI and dipped consumer sentiment continue to bechallenges
for the auto industry.


Your Company has systems in place to identify assess monitor andmitigate various risks to key business
objectives. Major risks identified by the businesses and functions are systematicallyaddressed through
mitigating actions on a continuing basis. These are discussed regularly at Audit Committeemeetings.

Risks Identified and Mitigating actions:

• Concentrated Customer Base: Your Company has taken steps tomitigate this risk by business
development activities to enhance the customer base and striving to increase share ofbusiness
with existing customers where Company's share is low.

• Skill Availability: Your Company focuses on recruitment andin-house skill development to address
this challenge.

• Rising input costs: Rising input costs are a risk and henceyour Company has on going improvement
initiatives like conversion cost reduction supply chain efficiency improvement andmaterial yield

Your Company is working diligently to mitigate the above risks andconcerns.


Discussion on state of Company's affairs has been covered as part ofthe Management Discussion and


Internal financial control systems of the Company are commensurate withits size and the nature of its
operations. Your Company has developed internal control systems by documenting procedurescovering
financial and operating functions. These systems are providing a reasonable assurance withregard to its
financial and operations controls. The Audit Committee satisfied itself of the adequacyand effectiveness
of the internal financial control system as laid down and kept the Board of Directorsinformed.

Some significant features of the internal control systems are:

• SAP is used for control of all transactions including financematerials dispatch quality costing etc.
across all locations.

• A detailed preparation and subsequent monitoring of both AnnualBudgets & Capital Expenditure
budgets for all its functions.

• Internal audits are conducted by external auditors and theyaudit all aspects of business based on
audit programmes finalized by the Audit Committee.

• Review of the financial performance by Audit Committee.


Note No. 35 of the Financial Statements sets out the nature oftransactions with Related Parties.
Transactions with Related Parties are carried out in the ordinary course of business andat arm's length.
The details of the transactions are tabled before the Audit Committee. Further details onthis are explained in the Corporate Governance Report. None of the transactions withrelated parties falls under the scope
of Section 188 (1) of the Companies Act 2013. Hence no particulars are being provided inForm AOC-2.


Pursuant to the provisions of the Companies Act 2013 and Rules madethere under amended from to
time your Company is not mandatorily required to spend any amount in view of the losses.Your Company
has however been undertaking CSR initiatives voluntarily. CSR Committee constituted interms of Section
135 of the Companies Act 2013 monitors the CSR activities undertaken by the Company asper CSR
Policy. The CSR Policy has been uploaded on the website of the Company: .
The employees from all plants of the Company voluntarily contribute their time by visitingorphanages/ old
age homes schools etc. to provide some companionship and succour to children and agedpeople. Your
Company identifies employable local youth and provides training to them under their SkillDevelopment


Your Company is committed to provide a safe secure and healthyworkplace and this has been documented
in the Health Safety and Environment (HSE) policy which is part of the OverarchingWellness strategy
of your Company. Your Company has therefore adopted a comprehensive approach to implementthis by
adopting ‘Total Safety Culture' concept across its operations. All the Plants of yourCompany have been
certified for EMS 14001 and OHSAS 18001 and National Safety Council (NSC). During theperiod under
review Company's Bhosari plant received ‘Certificate of Appreciation' from NSC. Allplants are especially
focused on the wellness initiative and monthly wellness program have been conducted byGroup Medical

Your Company has engaged the British Safety Council (BSC) forcertification. Your Company is in process
of getting BSC Certification in the FY 2019-20. Internal Audits of BSC for health safetyand environment
have been conducted at all Plants every quarter and training and awareness initiativeshave been
undertaken. Health checks and counselling are extended to employees.

During the year the approach to safety has been further strengthenedin all operations of your Company.
Regular safety drills and safety audits are conducted at all plants. The requisitetraining is provided to the
employees in Safety.

Your Company has taken initiatives to reduce its carbon footprint byreducing power consumption and
selling steel scrap to be reprocessed and sold. Thermography Survey was conducted toreduce electricity
/ power consumption Overheating.

There is a continued focus on tracking of "near miss"incidences which has resulted not only in reduction
of reportable accidents but even in first aid injuries and non- reportable accidents.Safety competitions
presentations on safety kaizens mock drills etc. are conducted for achieving a safe andhealthy work

Your Board of Directors are regularly updated on Health Safety andEnvironment related matters.

All the manufacturing Plants of your Company are certified under TS16949 and ISO 14001. Your Company
has been implementing the Tata Business Excellence Model to build excellence in itsbusiness operations.


• Appointment of Directors

During the year under review the Board made the following appointmentsbased on the
recommendations of Nomination and Remuneration Committee. In compliance with theprovisions
of Companies Act 2013 the appointment of following Directors is being placed before theMembers
in the ensuing Annual General Meeting for their approval.

• Re-appointment of Mr. Pradeep Bhargava (DIN: 00525234) asNon-Executive Independent
Director to hold the office for a second term of 4 (four) consecutive years on the Boardof the
Company from July 22 2019 to July 212023.

• Re-appointment of Ms. Rati Forbes (DIN: 00137326) asNon-Executive Independent Director
to hold the office for a second term of 1 (one) consecutive year on the Board of theCompany
from July 22 2019 to July 212020.

As per the provisions of Section 149 of the Act they will not beliable to retire by rotation.
Members are requested to refer to Item Nos. 5 and 6 of the Notice of the 29th AnnualGeneral
Meeting and the Explanatory Statement for details of their qualifications and experience.

• Appointment of Mr. Shrikant Sarpotdar (DIN: 01800442) as anAdditional Director designated
as Non-Executive Independent Director of the Board with effect from April 24 2019 to hold
office upto the date of ensuing Annual General Meeting. Pursuant to the provisions ofSection
161 of the Companies Act 2013 and Article 37 of the Articles of Association of theCompany
Mr. Shrikant Sarpotdar is eligible for appointment as Non-Executive Independent Director
of the Company. His appointment is for a term of 5 (five) consecutive years commencing
from April 24 2019 up to April 23 2024. As per the provisions of Section 149 of the Act
he will not be liable to retire by rotation. Members are requested to refer to Item No.7of the
Notice of the 29th Annual General Meeting and the Explanatory Statement for details of his
qualifications and experience.

• Appointment of Mr. Sanjay Sinha (DIN: 08210898) and Mr. ArvindGoel (DIN 02300813) as
Additional Directors designated as Non-Executive and Non-Independent Directors of the
Board with effect from October 26 2018 and January 212019 respectively to hold office
upto the date of ensuing Annual General Meeting. Pursuant to the provisions of Section 161
of the Companies Act 2013 and Article 37 of the Articles of Association of the CompanyMr.
Sanjay Sinha and Mr. Arvind Goel vacates office and are eligible for appointment as Non-
Executive Directors of the Company liable to retire by rotation.

• Retirement of Directors

Mr. Deepak Rastogi (DIN: 02317869) retired by rotation and wasre-appointed in the 28th Annual
General Meeting held on June 05 2018. Mr. Bharat Parekh (DIN: 01521346) will retire byrotation
at the conclusion of the ensuing Annual General Meeting and being eligible has offeredhimself for

In accordance with the Group retirement policy for Board of Directorsthe following Directors retired
during the period under review:

1. Mr. Ajay Tandon (DIN: 00128667) and Mr. Harish Pathak (DIN:02426760) retired as Non-
Executive Directors of the Company from the close of working hours of September 4 2018
and December 312018 respectively on attaining the age of retirement in accordance with
Governance Guidelines on Board Effectiveness adopted by the Company.

2. Mr. Ramnath Mukhija (DIN: 00001653) Non-Executive IndependentDirector and Chairman
on the Board retired from the close of working hours i.e. February 04 2019 on attaining
the age of retirement in accordance with Governance Guidelines on Board Effectiveness
adopted by the Company.

The Board of Directors placed on record its sincere appreciation forthe valuable guidance and
immense contributions made by Mr. Ajay Tandon Mr. Harish Pathak and Mr. Ramnath Mukhija
during their tenure as Directors of the Company and wished them well for future endeavors.

The Board appointed Mr. Pradeep Bhargava Non-Executive IndependentDirector as the Chairman
of the Board wef April 24 2019.

• Key Managerial Personnel

Pursuant to the provisions of Section 203 of the Companies Act 2013the Key Managerial
Personnel of the Company are: Mr. Neeraj Shrivastava Manager designated as ChiefExecutive
Officer Mr. Easwaran S. Chief Financial Officer and Mr. Ashutosh Kulkarni CompanySecretary.

During the period under review Mr. Prashant Mahindrakar resigned as aManager designated as
Chief Executive Officer of the Company with effect from close of working hours of August5 2018
to take up new responsibility with another TATA Company. The Board placed on record itssincere
appreciation for valuable contribution made by him during his tenure with the Company.

Mr. Neeraj Shrivastava was appointed as Manager designated as ChiefExecutive Officer of the
Company for a term of 3 years w.e.f. August 6 2018. The approval of the Members will beobtained
for his appointment and remuneration at the ensuing Annual General Meeting. Members are
requested to refer to Item No. 8 of the Notice of the Annual General Meeting and theExplanatory
Statement for details

During the year Mr. Anubhav Maheshwari resigned as Chief FinancialOfficer of the Company with
effect from close of working hours of November 14 2018. The Board placed on record itssincere
appreciation of the services rendered by him during his tenure with the Company.

Mr. Easwaran S. has been appointed as Chief Financial Officer of theCompany w.e.f. January 21


Pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure
Requirements) Regulations 2015 and as per Guidance Note on Board Evaluation issued bySEBI on
January 5 2017 the Board has carried out the annual performance evaluation for FY2018-19 of (a)
its own performance; (b) the Directors individually; and (c) the working of its Committeesviz. ‘Audit
Committee' ‘Nomination and Remuneration Committee' ‘Corporate SocialResponsibility Committee' and
the ‘Stakeholders Relationship Committee'. The details of evaluation process havebeen explained in the
Corporate Governance Report.


The details of the Remuneration Policy as approved and adopted by Boardare stated in the Corporate
Governance Report.


The Company has adopted the Guidelines on Board Effectiveness("Governance Guidelines" or
"guidelines") which inter-alia cover the criteria for determiningqualifications attributes and independence
of a Director. The details of the Policy are stated in the Corporate Governance Report.


The Company has received necessary declarations from all theIndependent Directors under Section 149
(7) of the Companies Act 2013 and SEBI Listing Regulations that :

a) they meet the criteria of independence laid down in Section 149 (6)of the Companies Act 2013 and
SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015

b) they are not aware of any circumstance or situation which exist ormay be reasonably anticipated
that could impair or impact their ability to discharge their duties with an objectiveindependent
judgment and without any external influence pursuant to Regulation 25 of the ListingRegulations.


The details of Board and Committee meetings held during the year aregiven in the Corporate Governance Report.


During the year under review there has been no change in the nature ofbusiness of the Company.


There have been no material changes and commitments which affect thefinancial position of the company
which have occurred between the end of the financial year to which the financialstatements relate and
the date of this Report.


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


There are no loans guarantees or investments made by Company underSection 186 of the Companies
Act 2013.


The Company has not accepted deposits under Chapter V of the CompaniesAct 2013 during the year
under review. No amount on account of principal or interest on deposit from public wasoutstanding as on
March 312019.


In terms of Regulation 34 of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015
the Report on Corporate Governance along with the Certificate of Compliance from theAuditors forms
part of this Report.


Based on the framework of internal financial controls and compliancesystems established and maintained
by the Company work performed by the internal statutory and secretarial auditorsincluding audit of
internal financial controls over financial reporting by the Statutory Auditors and thereviews performed by
the Management and the relevant Board Committees including the Audit Committee the Boardis of the
opinion that the Company's internal financial controls were adequate and effective duringthe financial
year 2018-19.

Accordingly pursuant to Section 134 (3) (c) and 134 (5) of theCompanies Act 2013 the Board of Directors
to the best of their knowledge and ability confirm that:

1. in the preparation of the annual financial statements for the yearended March 31 2019 the
applicable accounting standards have been followed and there are no material departures;

2. accounting policies have been selected and applied consistently andjudgments and estimates that
are reasonable and prudent have been made so as to give a true and fair view of the stateof affairs
of the Company as at March 312019 and of the loss of the Company for the year ended onthat

3. proper and sufficient care have been taken for the maintenance ofaccounting records in accordance
with the provisions of this Act for safeguarding the assets of the Company for preventing& detecting
fraud and/or other irregularities;

4. the annual accounts have been prepared on a going concern basis;

5. internal financial controls have been laid down by the Company andthat such internal financial
controls are adequate and are operating effectively; and

6. proper systems have been devised to ensure compliance with theprovisions of all applicable laws
and that such systems are adequate and operating effectively.


The information on conservation of energy technology absorption andforeign exchange earnings and
outgo stipulated under Section 134 (3) (m) of the Companies Act 2013 read with Rule 8 ofthe Companies
(Accounts) Rules 2014 is annexed as Annexure I to this Report.


Pursuant to Section 92 (3) of the Companies Act 2013 and Rule 12 (1)of Companies (Management and
Administration) Rules 2014 as amended from time to time the extract of Annual Return inForm MGT-9 is
annexed as Annexure II to this Report.


At the end of March 2019 your Company had 591 employees (excludingtrainees and apprentices) as
compared to 585 employees as on March 312018.

Your Company accords high importance in building and sustaining healthyemployee engagement with the
aim of achieving competitive productivity and harmonious work environment. The industrialrelations during
the year remained peaceful. With a view to ensure prompt resolution of employee'sgrievances various
Committees have been set up under the capable Chairmanships which are guided by FunctionalHeads
/ Department Heads e.g. Works Committee Health Safety and Environment CommitteePrevention of
Sexual Harassment Committee (POSH) etc. The functioning of these Committees are regularlyreviewed
by the Management and the Board is also updated regularly. During the year the EmployeeEngagement
Survey has been carried out which had shown significant improvement from 37 per cent inyear 2013 to
84 per cent in year 2018.

Your Company has HR help desk to resolve grievances/day to day issuesof employees within time bound
manner. This results in maintaining transparent culture and help to increase satisfactionlevel of the

Considering the competitive market scenario it has become essential tohave substantial improvement in
the productivity on the shop floor. Your Company has been implementing TPM WCSQ Kaizenand other
various systems to improve overall performance of all plants.

Information required under Section 197 (12) of the Companies Act 2013read with Rule 5 (1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is set out inAnnexure
III to this Report.

Information required under Section 197(12) of the Companies Act 2013read with Rule 5 (2) (i) to (iii) of
the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is notgiven since
there is no employee who received remuneration in excess of the limits prescribed therein.

The information required under Rule 5(2) and (3) of the Companies(Appointment and Remuneration of
Managerial Personnel) Rules 2014 is provided in the Annexure forming part of the Report.In terms of the
first proviso to Section 136 of the Companies Act 2013 the Report and Accounts are beingsent to the
Members excluding the aforesaid Annexure. Any Members interested in obtaining the same maywrite to
the Company Secretary at the Registered Office of the Company. None of the employee listedin the said
Annexure is related to any Director of the Company.


Your Company has adopted a Policy on Prevention Prohibition andRedressal of Sexual Harassment at
the Workplace in line with the provisions of the Sexual Harassment of Women at Workplace(Prevention
Prohibition and Redressal) Act 2013 and the Rules there under. The Policy aims to provideprotection to
employees at the workplace and prevent and redress complaints of sexual harassment and formatters
connected or incidental thereto with the objective of providing a safe workingenvironment where
employees feel secure. Your Company has also constituted an Internal Complaints Committeeknown as
the Prevention of Sexual Harassment (POSH) Committee to inquire into complaints of sexualharassment
and recommend appropriate action. Awareness Programmes were conducted at various plants ofthe

Your Company has not received any complaint of sexual harassment duringthe financial year 2018- 19.


The details of Risk Assessment framework are set out in the CorporateGovernance Report forming part
of the Board's Report.


Your Company has adopted a vigil mechanism. The details of the same areexplained in the Corporate
Governance Report and also posted on the website of the Company.


Your Company did not have any subsidiaries associates or jointventures during the year under review.


1. Statutory Auditors:

The Board of Directors at its meeting held on May 22 2017 appointed BS R & Co. LLP Chartered
Accountants Pune with Registration no. 101248W/W-100022 as Statutory Auditors for aperiod of 5
years to hold office till the conclusion of 32nd AGM to be held in FY 2022-23 which wasapproved
by the Members at the 27th AGM held on July 28 2017.

Vide notification dated May 7 2018 issued by Ministry of CorporateAffairs the requirement of
seeking ratification of appointment of statutory auditors by members at each AGM has beendone
away with. Accordingly no such item has been considered in notice of the 29th AGM.

The Statutory Auditors' Report for FY 2018-19 on the financialstatement of the Company forms
part of this Annual Report.

There are no qualifications reservations or adverse remarks made bythe statutory auditors in their
audit reports on the financial statements for the year ended March 312019. Theobservations of
the Statutory Auditors in their Reports are self-explanatory and therefore Directors don'thave any
further comments to offer on the same.

Necessary disclosures and explanations on observation of StatutoryAuditors on Corporate
Governance Report are given in point no. 2 (C) below.

2. Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board of Directors
had appointed SVD & Associates Practicing Company Secretaries for conductingSecretarial
Audit of the Company for FY 2018-19. The Report of the Secretarial Audit is annexedherewith as
Annexure IV to this Report.

Pursuant to recent amendments in Listing Regulations read with SEBIcircular No. LIST/
COMP/14/2018 dated June 20 2018 a certificate from SVD & Associates CompanySecretary in
practice that none of the Directors on the Board of the Company have been debarred ordisqualified
from being appointed or continuing as directors of companies by the SEBI/Ministry ofCorporate
Affairs or any such statutory authority is annexed to Corporate Governance Report.

The Secretarial Auditors in their Secretarial Audit Report haveobserved that:

A) Due to resignation of Non- Executive Director w. e. f September 62018 the Stakeholders
Relationship Committee has only one Member. However the company appointed another
director on October 26 2018 and reconstituted the Stakeholders' Relationship Committee.

Comments by the Board of Directors - During the quarter endedSeptember 2018 Mr.
Ajay Tandon stepped down as a Non-Executive Director of the Company upon reaching
superannuation with effect from the close of business hours of September 5 2018 and hence
consequently ceased to be a member of the Stakeholders Relationship Committee apart
from other Board Committees. The Board of Directors of the Company at its meeting held on
October 26 2018 approved and reconstituted the Stakeholders Relationship Committee in
terms of Companies Act 2013 and Listing Regulations. There was no Board meeting held
post superannuation date of Mr. Ajay Tandon i.e. September 5 2018 till October 26 2018
the Stakeholders Relationship Committee of the Company could not be represented through
adequate number of members in the interim.

B) The transfer of 2538 shares to the IEPF Authority as required undersubsection (6) of the
Section 124 of the Companies Act 2013 the intimation notice to the shareholders Issue
of Public notice and filing of Corporate Actions with Depositories as per clause (a) ofSub
rule (3) of Rule 6 of Investor Education and Protection Fund Authority (Accounting Audit
Transfer and Refund) Rules 2016 has been done after the prescribed time period.

Comments by the Board of Directors - The Company has total 25Shareholders holding
2538 equity shares wrt financial year 2010-11 who has not claimed any dividend from past
7 consecutive years or more. There was some delay wrt transfer of these shares to IEPF
Demat Account due to technical issue. However once the issue got resolved the shares
were immediately transferred to IEPF Demat Account without any delay.

C) The Chairperson of the Company has ceased to be a Director onattaining the superannuation
w.e.f. February 5 2019 and in the Board Meeting held on 12th March 2019 the Board has
appointed one of the Independent Director as Chairman of the Meeting. In the absence of
appointment of any other person as Chairperson of the Company the compliance under
regulation 17 (1) (b) of Listing Regulations during that period cannot be ascertained.

Comments by the Board of Directors - The Company has Mr. RamnathMukhija Non-
Executive Independent Director as regular Chairperson till February 4 2019. Mr. Ramnath
Mukhija retired from the close of working hours i.e. February 04 2019 on attaining theage
of retirement in accordance with Governance Guidelines on Board Effectiveness adopted
by the Company. The Company has appointed Mr. Pradeep Bhargava Non-Executive
Independent Director as regular Chairperson of the Board at Board meeting held on April
24 2019.


The Company complies with all applicable Secretarial Standards.


During the year under review neither the statutory auditors nor thesecretarial auditor has reported to the
Audit Committee under Section 143 (12) of the Companies Act 2013 any instances of fraudcommitted
against the Company by its officers or employees the details of which would need to bementioned in the
Board's report.


Certain statements describing the Company's Estimates ProjectionsExpectations Future Outlook
Industry Structure and Developments may be construed "forward-lookingstatements" within the meaning
of applicable laws and regulations. Actual results may differ materially from those eitherexpressed or
implied in this Report.


Your Directors place on record their sincere thanks and appreciationfor the confidence reposed and
continued support extended by Central and State Governments Bankers Customers Suppliersand
Members. Your Board would like to place on record its sincere appreciation to theemployees for the
dedicated efforts and contribution in playing a very significant part in the Company'soperations.

Annexure I to Board's Report



(i) Steps Taken or Impact on Conservation of Energy:

The Company has always been giving due consideration for theconservation of energy by
adopting the following measures:

• Use of T5 energy efficient tube lights for plant lighting toreduce power consumption.

• Variable Speed system used for press machine main Motor forrunning and Die setup
to reduce energy consumption.

• Use of auto shut-off Valve for all air Compressors during idletime resulting in energy

• Maintaining of power factor to unity.

• Use of LED Energy efficient high bay lights for plant lightingto reduce power

• Running plants on VFD (Variable Frequency Drive) to reduceenergy consumption.

• During idle time like - lunch and tea breaks shutting down ofPress Machines and
Chain Conveyors main motor by using PLC logic.

• Use of transparent sheets in plant storage area resulted inpower consumption

These measures are aimed at effective management and utilization ofenergy resources in
a proper manner and resultant cost saving for the Company.

(ii) Steps taken by the Company for utilizing alternate sources ofEnergy:

The Company is working on exploring the alternate sources of energy.

As a step towards alternate sources of energy during the period underreview your Company
in January 2019 has installed at its Chakan plant Solar Panel with 844 KWP capacity under
OPEX model with Solar Power Producer Company. The Solar energy is clean with no
environment and sound pollution. It helps to reduce temperature inside the Plant byapprox.
2 Degree Celsius during the day time since Solar Panels are installed on roof top ofplant. It
is synchronised with grid Electricity Board Power and percentage usage of ElectricityPower
Board is reduced by more than 15%.

(iii) Capital Investment on Energy Conservation Equipments:

The Company acknowledges the fact that investment in energyconservation offers significant
economic benefits in addition to climate change benefits. During the year the Company
has invested र 66.97 Lakhs as capital investment in energy conservation equipmentslike
Variable Frequency Drive (VFD).


During the year under review the Company has adopted Robotic Spot Weldwith CNC turning
fixture concept for new Programmes of Customers in order to optimise space manpower and
simultaneously meeting Customer Volumes.

The engineering team of the Company develops concepts for productivityimprovement during
development of new Dies and welding fixtures with Die makers and fixture manufacturersfor new
programmes of OEMs.


During the year the total foreign exchange expenditure amounted toर 428.91 Lakhs (which
includes र 427.20 Lakhs for the import of raw materials and components and र1.71 Lakhs towards expenditure in foreign currency).

The Company did not earn any foreign exchange.

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