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TTK Prestige

BSE: 517506|NSE: TTKPRESTIG|ISIN: INE690A01010|SECTOR: Domestic Appliances
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Directors Report Year End : Mar '16    « Mar 15
The Directors have pleasure in presenting their Sixtieth Annual
 Report, together with the Audited Accounts of the Company, for the year
 ended 31st March, 2016 as follows:
 
 FINANCIAL RESULTS
 
                                            (Rs, in crores)
 
                                            2015-16    2014-15
 
 Sales (inclusive of excise duty)           1558.82    1421.42
  
 other income                                  9.60       5.10
 
 Exceptional Income/(expense)                 (3.74)      2.44
 
 EBIDTA (before net Exceptional Income)      192.07     154.34
 
 EBIDTA (Including net Exceptional           188.33     156.78 
 Income)
 
 Profit/(Loss) before tax                    165.57     133.30
 
 Tax Provision                                50.75      40.98
 
 Net Profit/(Loss) after Tax                 114.82      92.32
 
 Transfer to General Reserve                  12.00      10.00
 
 Dividend paid /Proposed Dividend
 
                                              37.83      30.83
 
 (including tax)
 
 Surplus carried to balance sheet             64.99      51.49
 
 REVIEW OF PERFORMANCE :
 
 a.  Notwithstanding the continuing general sluggishness in the economy
 your company witnessed a growth of around 10% in top line. While there
 was a decline in exports, the domestic business registered about 11%
 growth.
 
 b.  Aided by a combination of factors - friendly commodity prices,
 better utilisation of capacities and internal efficiencies EBIDTA
 before exceptional items registered a growth of over 24%.
 
 c.  operating EBIDTA (before exceptional items) margin grew from 10.8%
 to 12.3%.
 
 d.  Your Company continued to be debt-free as at the end of 31st March,
 2016 and was carrying significant net free cash.
 
 e.  As stated in the past years, your company does not follow a
 stand-alone margin led policy but is focussed on growth with a fair
 long-term return on capital employed. In spite of substantial additions
 to manufacturing asset base in recent years the ROCE showed marked
 improvement and stood at a healthy 28% (PY 24%)
 
 f.  Your Board had already paid an interim dividend of Rs.27/- per
 share (PY Rs.22 share),the gross pay-out ratio (including dividend
 distribution tax) being in excess of 33% of net profits. The said
 dividend is recommended to be confirmed as final dividend.
 
 To sum up, your Board of Directors is of the view that the current year
 performance is commendable taking into account the general sluggish
 economy both domestic and global. The market share of the key product
 categories was maintained or improved across geographies which are key-
 factors to note. The e-commerce channel confect was less disruptive as
 compared to FY 2014-15 and your company''s share in this space is
 impressive.
 
 A detailed analysis is provided under the section ''Management''s
 Discussion and Analysis'' forming part of this Director''s Report
 
 AWARDS AND RECOGNITIONS
 
 Your Company continued to be recognized by various agencies for its
 high quality performance under various parameters.  During the
 Financial Year 15-16, your Company bagged the following
 awards/recognitions.
 
 1.  Readers Digest Most trusted Brand award
 
 2.  D & B top 500 Companies Award
 
 3.  Selected No 1 Brand in Kitchen Appliances by IBC Info media Pvt.
 Ltd.,
 
 4.  ICON of the year by Brands academy 9th Oct 2015
 
 5.  SUPER BRAND
 
 6.  Master Brand Award in Kitchen Appliances
 
 7.  CII Design award for Clip on Pressure Cookers
 
 8.  Brand Excellence Award
 
 9.  Industrial Design Award to Hobtop
 
 10.  TPM Excellence award from the Japan Institute of Plant Maintenance
 for the Coimbatore Plant.
 
 11.  Best After Sales Service Company Award in the small & kitchen
 appliance category from National Award for Excellence in Customer
 Service.
 
 Your Company''s brand Prestige continues to be recognized as the Super
 Brand in the Kitchen Appliances Segment
 
 MANAGEMENTS'' DISCUSSION AND ANALYSIS
 
 A.  ECONOMY /INDUSTRY SCENARIO
 
 There was no major improvement in macroeconomic environment in the
 domestic markets and the global scenario continued to be dismal.
 Deficient monsoon in many parts of the country and unprecedented foods
 in certain pockets like Tamil Nadu had adverse impact on agricultural
 and rural economy. Though festive season in October 2015 showed a
 promise, the same was short lived and the consumer sentiment continued
 to be depressed.
 
 While there have been may initiatives form the Central Government to
 accelerate investments in infrastructure projects and to ensure that
 subsidies reach the target population without any leak, lack of
 political consensus is hampering reforms like land acquisition,
 recodifcation of labour laws, GST etc., The rural thrust in the Central
 Budget for FY 2016-17 and expected normal monsoon can have positive
 impact on the rural economy especially in the second half of the
 current Financial Year.
 
 Your Company operates in the kitchen appliances segment with a wide
 range of product categories. The product categories consist of Pressure
 Cookers, Cookware, Gas Stoves and Domestic Kitchen Electrical
 Appliances. The market for Pressure Cookers is shared amongst organized
 national branded players, regional players and unorganized players.
 over the years, the share of the unorganized players has been gradually
 coming down as there has been a shift in the consumer preference to
 reliable branded products.  The market for organized brands is
 estimated at about 60% of the total market. The share of unorganized
 players is greater for cookware as compared to pressure cookers. For
 the rest of the product categories, the market structure is fragmented
 and the share and the role of regional brands and unorganized players
 continue to be significant.
 
 Continued sluggish economic scenario is hampering spend from core
 middle-class giving room for down-trading by some regional brands and
 cropping up of some unorganised players. While there is demand for
 entry level models in certain categories, in other categories the
 demand is seen more in value added products.
 
 The kitchen appliance category is also witnessing entry of quite a few
 players - regional, national as well as global players who have brand
 strength mostly in non-kitchen appliance business.
 
 Going forward, proactive innovation and product differentiation will be
 the key to stay ahead in the market place.
 
 B.  OPPORTUNITIES, THREATS AND COMPANY''S RESPONSE
 
 Shareholders are aware that the Company operates out of its core
 strengths of brand, innovation, design, manufacturing, distribution,
 sourcing and service capabilities and more importantly ''Customer
 Engagement.
 
 a. Opportunities within the Kitchen domain:
 
 The core vision of the company has been ''A Prestige in every Indian
 Kitchen''; the core mission being ''Quality products at affordable
 prices''.
 
 The above stated strengths and vision have helped your Company to broad
 base its product category, consumer base and geographical coverage.
 Continuous interaction with the ultimate user of the product has been
 helping your Company in identifying the pain points and offering
 solutions in the form of innovative products, concepts and consumer
 offer of bundled products for a holistic use. This focus helps your
 Company to create opportunities even in the face of depressed consumer
 sentiment.
 
 Your Company sees sufficient headroom for growth in its traditional
 product categories - pressure cookers and cookware driven by
 introduction of several new models with value added features. Various
 new variants such as Clip on, Cute Range, Granite Cookware etc.,
 introduced in FY 2015-16 received good response even in adverse market
 conditions. Likewise your Company sees greater opportunity in the
 kitchen appliances segment – both electric and non-electric. Value
 added gas stoves, hob- tops; new range of mixer-grinders and induction
 cook tops are expected to lead the growth in the Kitchen Appliances
 segment. As always, a whole range of innovative assorted products
 relevant to kitchen (roti makers, kitchen gadgets and accessories)
 provides scope for significant value addition to topline as well as
 profits.
 
 Your Company is slated to launch around 100 new SKUs in the financial
 year 2016-17.
 
 Your Company continues to see a significant opportunity to increase its
 share of business in the non-south markets.
 
 b.  Opportunities beyond Kitchen domain:
 
 Till now all the strategy for growth has been fowing out of Kitchen
 Domain. Your Company''s strength of constant engagement with the end
 consumer has thrown open new avenues for occupying the mind share of
 the core customer – ''the home maker'' – travelling beyond kitchen. Based
 on customer feedback, your Company believes that as a first step
 outside the Kitchen Domain, Cleaning Solutions offers a good platform.
 A wide range of Cleaning equipment– both electrical and non-electrical
 - is being launched from the first quarter of FY 2016-17. The number of
 SKUs being launched is around 30. Your Company has already tested the
 domain outside the kitchen by launching ''LED Lanterns'' during FY
 2015-16 and the response has been encouraging.
 
 c.  Opportunities outside INDIA: -Overseas Acquisition
 
 Till now, the opportunity outside India has been product exports in
 third party brands. This has been tactical and exports have been
 volatile and dependent on the oE Buyers'' fortunes and marketing
 strategies.  Your Company has been scouting for acquisition of brands
 outside India with strengths in sales, marketing and distribution and
 not saddled with high-cost manufacturing. Your Company identified
 Horwood Home wares Limited, UK, a century old business owning and
 trading in well-respected brands Judge and Stellar.  Your Company''s
 wholly owned subsidiary TTK British Holdings Limited, UK acquired this
 business in April 2016. The subsidiary is capitalized by equity
 infusion to the extent of 10 million GBP from your Company. This
 business is currently of the order of 18 million GBP with an EBIDTA of
 around 3 million GBP. This acquisition is expected to leverage the
 manufacturing capacities of your Company as well as provide a platform
 to tap key markets in Europe.
 
 d.  Channel management and service Network:
 
 over the last few years the method of reaching the ultimate consumer is
 undergoing a churn. Every channel – traditional dealers, modern format
 stores, own retail network or online stores – is rediscovering and
 re-orienting itself to maximize footfalls. This process has thrown in
 opportunities as well as confects besides disruptions. Your Company is
 fully seized of the situation and has put in place strategies to
 leverage every channel to reach the ultimate consumer.
 
 Prestige Smart Kitchen network continues to attract good traction and
 provides a significant contribution to the total domestic sales.
 Current focus is on quality of the network rather than the quantity.
 The network is now well consolidated after pruning unproductive stores.
 Due to this process the same store growth has been healthy.  The
 current strength of the network is 539.
 
 Your Company is continuing the process of strengthening the service
 network and call-centre operations so as to ensure timely service and
 build customer loyalty. It also provides the platform to increase sale
 of original spares.  Current strength of the service network is 225.
 
 
 Your Company sees reasonable opportunity in oE export markets based on
 its modern facilities established in Gujarat. The various initiatives
 proposed /announced by the Government in the areas of infrastructure,
 smart cities,'' Make in India'' etc., if become fruitful can open up
 multirole opportunities for your Company both in domestic and foreign
 markets.
 
 While there are vast opportunities in the Domestic Market, threats can
 continue in the form of unorganized sector and irrational discounting
 by regional brands. As the entry barriers are low, any lag in
 innovation can impact growth .
 
 C.  ANALYSIS OF PERFORMANCE :
 
 1.  Kitchen Appliances :
 
 The products include Pressure Cookers, Cookware, Kitchen Electrical
 Appliances and Gas Stoves. The turnover of these product categories is
 given in the following table:
 
                                                      (In Rs, Crores)
 
                       2015-16                            2014-15
 
                 domestic   Export   Total     Domestic   Export   Total
 
 Pressure          522.45    34.15   556.60     478.41     50.72   529.13
 
 Cookers
 (including
 
 Microwave
 
 Pressure 
 Cookers)
 
 Cookware           272.69    2.53    275.22    261.52      1.26   262.78
 
 Kitchen 
 Electrical         446.73    1.09    447.82    383.66       -     383.66
 
 Appliances
 
 Gas Stoves         209.53    1.40    210.93    174.64       -     174.64
 
 others              67.43    0.82     68.25     70.39      0.82    71.21
 
 Total             1518.83   39.99   1558.82   1368.62     52.80  1421.42
 
 a.  Domestic Sales grew by about 11%. Due to adverse global economic
 conditions exports declined by 24.3%.
 
 b.  The Pressure Cooker and cookware category registered a growth of
 5.2% and 4.7% respectively.  The lower growth was due to depressed
 market conditions in South India.
 
 c.  The sale of induction cook top witnessed 18% growth in quantity
 however the value growth was in the region of 7%. Introduction of
 several value added models helped in improving the value realization,
 which was a major concern during the last year.
 
 d.  Gas stoves recorded an impressive growth of over 20%,owing to the
 new higher end models introduced during the fag end of the previous
 financial year.
 
 e.  The operating EBIDTA margin for the year was about 12.32% as
 compared to 11% in the previous year. This margin improvement was aided
 by improvement in operating efficiency through increased capacity
 utilization and also the softening of metal prices.
 
 f.  Notwithstanding the long-term wage settlement at the Hosur Unit,
 the overall pay-roll cost ratio to Sales was around 7.1% as compared to
 7.3% in the previous year.
 
 g. The interest cost during the year was Rs.1.84 crs (PY Rs.4.47
 crores). The Company was able to reduce the borrowing completely
 through application of free cash fows.
 
 h. Your Company has over the last two years substantially reduced its
 dependence on imports which has a positive impact on margins and cash-
 fows. This import substitution continued during the current financial
 year. There was an increase in inventory at the end of the financial
 year to meet the plans for sale during the first quarter of FY 2016-17.
 However net-working capital excluding free cash was commensurate with
 the increased sales.
 
 i. During the year under report your Company introduced around 125 new
 SKUs covering Pressure Cookers, Induction Cook Tops, Mixer Grinders,
 Rice Cookers, Gas Stoves and other small electric/ non-electric
 appliances/kitchen requisites. All these introductions received good
 response.
 
 j. PSK network was consolidated and rationalized where necessary. The
 number of outlets as at 31.3.2016 was 539. The network now covers 26
 States and 294 towns. The spread of the network is also evenly
 distributed between Metros, Mini- Metros, Tier 1, Tier 2 and Tier 3
 cities. About 65% of the Stores are located in South and the balance in
 Non-South.
 
 2. Properties & investment :
 
 The shareholders are aware that Your Company has handed over the
 development of the Dooravani Nagar, Bangalore property to Rajmata
 Realtors (Salarpuria) for developing an office cum residential complex.
 The Developers have informed that the portions of developed property
 allocated to your Company would be ready for marketing in the first
 half of the current financial year.  Shareholders will be kept informed
 of progress made in this respect.
 
 d.  OUTLOOK
 
 The consumer sentiment continues to be sluggish at the start of the
 Financial Year 2016-17 though some green shoots are visible. Depending
 on the progress of a normal monsoon and the impact of the Central
 Government''s budget on rural economy and infrastructure a GDP growth of
 7% is expected. Given the new business initiatives your Company expects
 to grow at a better rate than the economy.
 
 E.  RISKS AND CONCERNS
 
 The various general economic risks and concerns which can impact your
 Company have already been outlined in the preceding sections. The
 concerns largely centre on external factors. Your Company is
 continuously improving its efficiencies and is hopeful of dealing with
 the various challenges described in the preceding sections. Your
 Company will not compromise on the objective of growth and improving
 market share for the sake of short-term profits.
 
 
 F.  RISK MANAGEMENT
 
 Your Company has developed and implemented a Risk Management Policy
 which includes identification of elements of risk, if any, which in the
 opinion of the Board, may threaten the existence of the Company.
 
 Your Company has a risk identification and management frame work
 appropriate to the size of your Company and the environment under which
 it operates.
 
 Risks are being continuously identified in relation to business
 strategy, operations and transactions, statutory/legal compliance,
 financial reporting, information technology system and overall internal
 control framework.
 
 Your Company has engaged the services of independent professional
 management auditors for advising the Company on a continuous basis on
 contemporary risk management framework appropriate to the size and
 operations of the Company. They are also carrying out risk audit on a
 periodical basis.
 
 g. SHARE CAPITAL
 
 The paid up equity share capital as on 31st March 2016 was 11.65
 Crores. The Company has not issued any shares with differential voting
 rights nor granted stock options nor sweat equity.
 
 H.  FINANCES
 
 Your Company continues to generate substantial post- tax operating free
 cash fows and the same have been applied to meet capital expenditure
 besides other uses including retirement of debt. Your Company continued
 to be debt-free and at the end of the year carried cash and cash
 equivalents of around Rs.26 crores and short term investments of around
 Rs. 44 crores. This was subsequently utilized to invest in the UK
 Subsidiary in April 2016.
 
 i.  INVESTMENTS
 
 There are no changes in the investments of the Company apart from
 changes in liquid investments in mutual funds as part of normal
 treasury operations.
 
 J.  INTERNAL CONTROL SYSTEMS
 
 Your Company has necessary Internal Control Systems in place which is
 commensurate with the size, scale and complexity of its operations.
 Your Company is continuously making improvements in internal control
 systems commensurate with the increasing operations. Independent team
 of Internal Auditors/Management Auditors are carrying out internal
 audits and advising the management on strengthening of internal control
 systems. The reports are periodically discussed internally. Significant
 audit observations and corrective actions thereon are presented to the
 Audit Committee.
 
 K.  DEVELOPMENTS IN HUMAN RESOURCES
 
 In pursuit of the Long Range Plan, your Company has forayed into
 overseas markets by establishing a subsidiary in UK. Your company is
 also expanding its operations beyond kitchen. Having due regard to
 entering new frontiers your Company has implemented strategic HR
 initiatives covering talent management, leadership development etc.
 The in-house Human Resource Department is being further strengthened. A
 host of people development programmes are put in place on a continuous
 basis.
 
 At the Hosur Plant, your Company concluded a long-term wage settlement
 during the year with better productivity terms. The entire process was
 cordial and smooth. Your Company continues to have cordial industrial
 relations in all its manufacturing units. A Voluntary Retirement Scheme
 was carried out in the Hosur Unit and about 54 employees opted for the
 same.
 
 The direct employment strength stood at 1217 as compared to 1267 in the
 previous year.
 
 SCHEME OF ARRANGEMENT:
 
 During November 2012 the Board of Directors of your Company approved a
 Scheme of Arrangement (Demerger) whereby the Kitchen Appliances
 Division of Triveni Bialetti Industries Private Limited (TBI), (a
 subsidiary of Bialetti Industries SpA., Italy) with all its assets,
 rights, liabilities, obligations, benefits under tax laws etc., will be
 vested in your Company the Appointed Date being 1st April, 2012. The
 Scheme has been approved by the Stock Exchanges and further approved by
 the Honourable High Court of Madras. However the sanction of the
 Honourable High Court of Mumbai, the jurisdictional court for TBI is
 still awaited owing to an appeal fled by a minority shareholder of the
 Transferor Company before the Division Bench who has granted a stay of
 the order of the Single Judge sanctioning the Scheme.The Scheme can
 take effect only on vacation of this appeal and necessary effect will
 be given in the books of account thereafter.
 
 TBI, which has its manufacturing base in Maharashtra, has arrangements
 with your company for contract manufacturing certain products for your
 Company.
 
 DIRECTORS
 
 Mr. T.T. Raghunathan retires by rotation and is eligible for
 re-appointment. The information on the retiring Director is provided in
 the Notice calling the Annual General Meeting.
 
 FIXED DEPOSIT
 
 Pursuant to the provisions of Section 74 of the Companies Act, 2013
 your Company has, during the year 2014-15 repaid all the deposits
 accepted from public. The Company is neither inviting or accepting
 deposits and hence there are no deposits outstanding or remaining
 unpaid as at the end of 31st March, 2016.
 
 DIVIDEND
 
 Your directors had already approved payment of interim dividend of
 Rs.27/- per share for the year and the same was paid to shareholders in
 March 2016. Your Directors recommend treating the same as final
 dividend. This dividend payout is higher than the payout of Rs.22 per
 share for FY14-15.
 
 FUTURISTIC STATEMENTS
 
 This Directors'' Report and the Management Discussion and Analysis
 included therein may contain certain statements, which are futuristic
 in nature. Such statements represent the intentions of the Management
 and the efforts being put in by them to realize certain goals. The
 success in realizing these goals depends on various factors both
 internal and external.  Therefore, the investors are requested to make
 their own independent judgments by taking into account all relevant
 factors before taking any investment decision.
 
 CORPORATE GOVERNANCE
 
 Report on Corporate Governance is separately presented as part of the
 Annual Report. Management Discussion and Analysis is included in this
 Directors'' Report in the preceding sections.
 
 BUSINESS RESPONSBILITY REPORT
 
 Your Company now forms part of the Top 500 listed companies of India
 and is mandatorily required to provide a Business Responsibly Report as
 part of the Annual Report in accordance with the provisions of SEBI
 (Listing Obligations and Disclosure Requirements) Regulations 2015.
 This report is separately presented as part of this Annual Report.
 
 LISTING
 
 Your Company''s shares are listed in the BSE Limited and National Stock
 Exchange and the applicable listing fees have been paid.
 
 FURTHER DISCLOSURES UNDER THE COMPANIES ACT, 2013 AND THE RULES MADE
 THERE UNDER:
 
 (a) Extract of Annual Return:
 
 Extract of Annual Return (Form MGT-9) is enclosed as Annexure A
 
 (b) Number of meetings of the Board:
 
 The Board of Directors met 5 (Five) times during the year 2015-16. The
 details of the Board Meetings and the attendance of the Directors are
 provided in the Report on Corporate Governance.
 
 (c) Corporate social Responsibility (CsR) Committee:
 
 As per the provisions of Section 135 of the Companies Act, 2013 and the
 Rules made there under, your Company constituted the Corporate Social
 Responsibility Committee which comprises of Mr. T.T. Jagannathan as
 Chairman and Mr. R Srinivasan, Mr. K Shankaran as Members.
 
 The Corporate Social Responsibility (CSR) Policy enumerating the CSR
 activities to be undertaken by the Company, in accordance with Schedule
 VII to the Companies Act, 2013 was recommended to the Board and the
 Board adopted the same. The said policy was also made available on the
 website of the Company http://www.ttkprestige.  com. The Annual Report
 under CSR Activities is annexed to this report as Annexure B.
 
 The details relating to the meetings convened, etc. are furnished in
 the Report on Corporate Governance.
 
 (d) Composition of Audit Committee:
 
 The Audit Committee comprises of Mr. Dileep Krishnaswamy as Chairman,
 and Mr. R Srinivasan and Mr. Arun K.  Thiagarajan as Members. All the
 members are Independent Directors.
 
 Mr. K Shankaran - Director and Secretary is the Secretary of the
 Committee. More details on the Committee are given in the Report on
 Corporate Governance.
 
 (e) Related Party Transactions:
 
 During the year under review, no transaction of material nature has
 been entered into by the Company with its promoters, the directors or
 the management, their subsidiaries or relatives, etc., that may have a
 potential confect with the interests of the Company.
 
 All related party transactions are placed before the Audit Committee as
 also the Board for approval. Prior omnibus approval of the Audit
 Committee is obtained on a yearly basis for the transactions which are
 of unforeseen or repetitive nature. A Statement giving details of the
 transactions entered into with the related parties, pursuant to the
 omnibus approval so granted, is placed before the Audit Committee and
 the Board of Directors for their approval / ratification on a quarterly
 basis.
 
 The Register of Contracts containing transactions, in which directors
 are interested, is placed before the Audit Committee / Board regularly.
 
 The Board of Directors of the Company, on the recommendation of the
 Audit Committee, adopted a policy on Related Party Transactions, to
 regulate the transactions between the Company and its Related Parties,
 in compliance with the applicable provisions of the Companies Act, 2013
 and the Listing Agreement. The Policy as approved by the Board is
 uploaded on the Company''s website athttp:// www.ttkprestige.com.
 
 The details of the Related Party Transactions in Form AoC- 2 are
 annexed as Annexure C to this Report.
 
 (f) directors and Key managerial Personnel:
 
 None of the Directors are disqualified from being appointed or holding
 office as Directors, as stipulated under Section 164 of the Companies
 Act, 2013.
 
 (i) Appointment / Re-appointment of directors:
 
 Mr.T.T. Raghunathan, liable to retire by rotation at the ensuing Annual
 General Meeting, being eligible, offers himself for re-appointment. The
 Board recommends his re-appointment.
 
 (ii) statement on declaration by the independent directors of the
 Company:
 
 All the Independent Directors of the Company have given declarations
 under Section 149(7) of the Companies Act, 2013 that they meet the
 criteria of independence as laid down under Section 149(6) of the
 Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and
 Disclosure Requirements) Regulations, 2015. The terms and conditions of
 appointment of the Independent Directors are posted on the website of
 the Company http://www.  ttkprestige.com.
 
 (iii) Key managerial Personnel (KmP):
 
 The following managerial personnel are Key Managerial Personnel (KMP):
 
 - Mr.Chandru Kalro, Managing Director as Chief Executive Officer (CEO)
 w.e.f. 1st April, 2015
 
 - Mr. K. Shankaran, Director & Wholetime Company Secretary as Company
 Secretary; and
 
 - Mr. V. Sundaresan, Senior Vice President – Finance as Chief Financial
 Officer (CFO).
 
 
 (iv) Performance Evaluation of the Board, its Committees and separate
 meeting of independent directors:
 
 In compliance with the provisions of the Companies Act, 2013 and
 Regulation 17(10) of SEBI (Listing Obligations and Disclosure
 Requirements) Regulations, 2015, the performance evaluation of the
 Board was carried out during the year under review. During the year 2
 separate meetings of Independent Directors were held to consider
 various aspects of Management of the Company as well as to review the
 performance of the Board and Non-Independent Directors''. More details
 on the same are given in the Report on Corporate Governance.
 
 (v) Remuneration Policy:
 
 Your Company follows a policy on remuneration of Directors and Senior
 Management. The policy is framed by the Nomination and Remuneration
 Committee and approved by the Board. More details on the same are given
 in the Report on Corporate Governance.
 
 (g) Auditors:
 
 (i) statutory Auditors and their Report:
 
 In accordance with the provisions Section 139 and other applicable
 provisions, if any, of the Companies Act, 2013 and the Rules made there
 under, M/s S. Viswanathan, LLP, Chartered Accountants, Chennai (Firm
 Registration No. 004770S/S200025) were appointed as Statutory Auditors,
 for a term of three years to hold office from the conclusion of 58th
 Annual General Meeting till the conclusion of 61st Annual General
 Meeting, subject to ratification by the members at every Annual General
 Meeting.
 
 Accordingly, a Resolution seeking members'' ratification for their
 appointment from the conclusion of this Annual General Meeting till the
 conclusion of the next Annual General Meeting of the Company is
 included under Item No. 4 of the Notice convening the Annual General
 Meeting.
 
 The Auditors'' Report to the Shareholders for the year under review does
 not contain any qualifications.
 
 (ii) Cost Auditor and Cost Audit Report:
 
 - Appointment for the year 2015-16:
 
 Pursuant to Section 148 of the Companies Act, 2013 read with The
 Companies (Cost Records and Audit) Amendment Rules, 2014, the Cost
 Records of the Company relating to Stainless Steel Pressure Cookers
 and Cookware are required to be audited.
 
 The Board of Directors, on the recommendation of the Audit Committee,
 appointed Mr. V.  Kalyanaraman as Cost Auditor of the Company, for the
 financial year 2016-17 and fixed their remuneration.
 
 Mr. V.Kalyanaraman has confirmed that his appointment is within the
 limits of the Section 141 of the Companies Act, 2013 and has also
 certified that he is free from any disqualifications specified under
 the provisions of Section 141 of the Companies Act, 2013.
 
 The Audit Committee also received a Certificate from the Cost Auditor
 certifying the independence and arm''s length relationship with the
 Company.
 
 Pursuant to the provisions of Section 148 of the Companies Act, 2013
 and the Rules made there under, the approval of the Members is sought
 by means of an ordinary Resolution for the remuneration payable to Mr.
 V. Kalyanaraman, Cost Auditor, under Item No.5 of the Notice convening
 the Annual General Meeting.
 
 The Cost Audit Report for the year ended 31st March, 2016 would be fled
 on or before the due date (i.e.) 27th September, 2016.
 
 (iii) secretarial Auditor and secretarial Audit Report:
 
 The Board had appointed Mr. Parameshwar G. Hegde, Company Secretary in
 Whole-time Practice, to carry out Secretarial Audit under the
 provisions of Section 204 of the Companies Act, 2013 for the financial
 year 2015-16. The Report of the Secretarial Auditor in Form MR-3 is
 annexed to this report as Annexure G The report does not contain any
 qualification.
 
 (h) Transfer to investor Education and Protection Fund:
 
 Your Company has transferred a sum of Rs.5.18 lakhs during the
 financial year 2015-16 to the Investor Education and Protection Fund
 established by the Central Government, in compliance with Section
 205C(2) of the Companies Act, 1956. The said amount represents the
 unclaimed dividends for the year ended 31st March, 2008, which were
 lying unclaimed with the Company for a period of seven years from their
 respective due dates of payment.
 
 (i) Unclaimed shares
 
 In terms of Clause 5A of the Listing Agreement, the Company has opened
 a Suspense Account for holding the unclaimed share. The number of such
 shares at the beginning of the year was 1,400 and the number of
 shareholders was 10.  Two shareholders approached to claim 200 shares
 during the financial year 2016. The voting rights on the shares in the
 suspense account as on 31st March, 2015 shall remain frozen till the
 rightful owners of such shares claim the shares.
 
 (j) Conservation of Energy:
 
 The prescribed particulars under Rule 8(3) of The Companies (Accounts)
 Rules, 2014 relating to conservation of energy, technology absorption,
 foreign exchange earnings and outgo, are furnished in the Annexure D to
 this Report.
 
 (k) Particulars of Employees:
 
 The information required under Section 197 of the Companies Act, 2013
 and the Rules made there under are annexed to this Report as Annexure E
 & Annexure F.
 
 
 (l) subsidiary Company:
 
 Your Company has an overseas subsidiary by name TTK British Holdings
 Limited which was incorporated in the United Kingdom on 24th March
 2016. This subsidiary was capitalized in the subsequent Financial Year
 i.e. in April 2016.
 
 (m) Loans, guarantees and investments under section 186 of the
 Companies Act, 2013:
 
 During the year your Company had not given any loan, provided any
 guarantee oR made any investment under Section 186 of the Companies
 Act, 2013. Your Company holds 1440 equity shares of Rs.10/- each in TTK
 Healthcare Limited. Your Company had in the past provided secured
 inter-corporate loan/deposit of Rs.18.75 crores to Triveni Bialetti
 Industries P Ltd, an unrelated party with whom your Company has
 business transactions and this amount is still carried.
 
 (n) Significant and Material Orders passed by the Regulators or Courts:
 
 There are no significant and material orders passed by the Regulators /
 Courts which would impact the going concern status of the Company and
 its future operations.
 
 (o) Whistle Blower Policy:
 
 In accordance with the provisions of Section 177(9) of the Companies
 Act, 2013 and the Rules made there under and also Clause 49 of the
 Listing Agreement, your Company established a vigil mechanism termed as
 Whistle Blower Policy, for directors and employees to report concerns
 about unethical behaviour, actual or suspected fraud or violation of
 the Company''s Code of Conduct or Ethics Policy, which also provides for
 adequate safeguards against victimization of director(s) / employee(s)
 who avail of the mechanism and also provide for direct access to the
 Corporate Governance Officer / Chairman of the Audit Committee /
 Executive Chairman in exceptional cases.
 
 The Whistle Blower Policy is made available on the website of the
 Company http://www.ttkprestige.com.
 
 (p) Obligation of your Company under the sexual Harassment of Women at
 Workplace (Prevention, Prohibition and Redressal) Act, 2013:
 
 In order to prevent sexual harassment of women at work place a new Act,
 The Sexual Harassment of Women at Workplace (Prevention, Prohibition
 and Redressal) Act, 2013 has been notified on 9th December, 2013. Under
 the said Act, every Company is required to set up an Internal
 Complaints Committee to look into complaints relating to sexual
 harassment at work place of any women employee.
 
 Your Company has adopted a policy for prevention of Sexual Harassment
 of Women at Workplace and has constituted a Committee with a NGo as one
 of its Members, for implementation of the said Policy. During the year
 2015-16, there were no complaints.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 As required by Sec.134 (5) read with Sec.134 (3) (c) of the Companies
 Act, 2013 your Directors confirm
 
 a.  that in the preparation of the annual accounts, the applicable
 accounting standards have been followed, along with proper explanation
 relating to material departures;
 
 b.  that they 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 at the end of the financial year and of the Profit or loss
 of the Company for that period;
 
 c.  that they have taken proper and sufficient care for the maintenance
 of adequate accounting records, in accordance with the provisions of
 this Act for safeguarding the assets of the Company and for preventing
 and detecting fraud and other irregularities; and
 
 d.  that they have prepared the annual accounts on a going concern
 basis; and
 
 e.  they have laid down internal financial controls to be followed by
 the Company and that such internal financial controls are adequate and
 are operating effectively.
 
 f.  they have devised proper systems to ensure compliance with the
 provisions of all applicable laws and that such systems are adequate
 and operating effectively.
 
 ACKNOWLEDGEMENTS
 
 Your Directors deeply appreciate and acknowledge the significant and
 continued co-operation given to your Company by the Bankers, Financial
 Institutions and the employees of the Company.
 
                                       For and on behalf of the Board
 
                                                   (T.T. JAGANNATHAN)
 
                                                   Executive Chairman
 
 Registered Office:
 
 Plot No.38, SIPCOT Industrial Complex,
 
 Hosur – 635 126
 
 TamilNadu
 
 
 
 Place : Coimbatore 
 
 Dated : 23rd May 2016
Source : Dion Global Solutions Limited
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