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Munjal Auto Industries Ltd.

BSE: 520059 | NSE: MUNJALAU | Series: NA | ISIN: INE672B01032 | SECTOR: Auto Ancillaries

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Annual Report

For Year :
2018 2017 2016 2015 2014 2013 2012 2011 2010

Director’s Report

BOARD''S REPORT

Dear Members,

Your Directors are pleased to present 33rd Annual Report together with the audited financial statements for the financial year ended March 31, 2018.

FINANCIAL RESULTS

The Company''s financial performance for the year ended March 31, 2018 is summarized below: -

(Rs in Lacs)

Particulars

Year ended '' March 31, 2018

Year ended March 31, 2017

Total Income

106,087.07

935,35.88

Profit before Finance Cost & Depreciation

76,92.46

66,79.28

Depreciation

(18,18.70)

(17,19.62)

Finance Cost

(4,32.73)

(5,50.42)

Profit before Taxation

54,41.03

44,09.24

Provision for Taxation (Deferred & Current)

(12,82.00)

(9,53.88)

Profit after Taxation

41,59.03

34,55.36

Surplus brought Forward

242,86.77

208,69.88

Surplus carried to Balance Sheet

262,64.96

242,86.77

DIVIDEND

Your Directors have pleasure to recommend a dividend of 60% i.e. Rs 1.201- on equity share of Rs 21- each for the financial year ended March 31, 2018. The dividend, if approved by the members in the ensuing Annual General Meeting, would absorb Rs 1,200 lacs (Rs 1,000 lacs for Final Dividend for FY16-17) out of the distributable profits available.

PERFORMANCE

During FY 2017-18, total income of the Company was Rs 1,061 Crore as compared to Rs 935 Crore in FY 2016-17, registering an increase of 13.48%.

Profit before tax and profit after tax were Rs 54.41 Crores and Rs 41.59 Crores respectively during the year as against Rs 44.09 Crores and Rs 34.55 Crores respectively in the previous year.

CAPACITY UTILIZATION & PLANT OPERATIONS

All four units of the Company located at Waghodia in Gujarat, Bawal as well as Dharuhera in Haryana and Haridwar in Uttarakhand are running well and continue to operate at a satisfactory level of efficiency.

INCREASE IN SHARE CAPITAL CONSEQUENT TO ISSUE OF BONUS SHARE

In pursuit of approval granted by the members of the Company at their 32nd Annual General Meeting held on June 30,2017, Committee of Board of Directors at their meeting held on July 13, 2017 had allotted one Bonus Equity Share of Rs 21- each fully paid up for every one Equity Share of Rs 21- each fully paid up as on the record date July 12, 2017 aggregating to 5,00,00,000 Equity Shares of Rs 10,00,00,000 to the members of the Company. Accordingly, the paid up capital increased from Rs 10,00,00,000 to Rs 20,00,00,000 on July 13,2017.

APPOINTMENT/ CESSATION OF DIRECTORS OR KMP

In terms of Section 152 and other applicable provisions, if any, of the Companies Act, 2013 (''the Act''), Mr. Sudhir Kumar Munjal retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for reappointment.

Your Board recommends reappointment of Mr. Sudhir Kumar Munjal, as Director as well as the Managing Director for the period of five years at the ensuing 33rd Annual General Meeting in terms of Section 152,196,197 and other applicable provisions, if any of the Act. He, in the opinion of the Nomination and Remuneration Committee and the Board, fulfills the conditions for reappointment specified in the Act and rules made there under.

It is also proposed to seek approval of the members by way of Special Resolution at their ensuing 33rd Annual General Meeting to the reappointment of and remuneration payable to Mr. Sudhir Kumar Munjal as a Managing Director of the Company for the period of 5 years from October 29, 2018 to October 28, 2023.

Brief resume and other details of Mr. Sudhir Kumar Munjal, who is proposed to be re-appointed as a Director of your Company, have been furnished in the Explanatory Statement to the Notice of the ensuing Annual General Meeting.

BOARD EVALUATION

Pursuant to the applicable provisions of the Act and Regulation 17(10) and other applicable regulations, if any, of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''LODR''), performance of the Board as a whole and individual Directors, was evaluated by the Board seeking relevant inputs from all the Directors. The Nomination and Remuneration Committee (NRC) reviewed the performance of the individual Directors. A separate meeting of Independent Directors was also held to review the performance of Non-independent Directors, performance of the Board as a whole and performance of the Chairperson of the Company.

The performance of the Board and individual Directors was found satisfactory.

QUALITY

Your Company is focusing on quality, right from new product development stage such as design of processes, manufacturing of tools, fixtures & dies, to ensure quality output. This is the attribute of your Company which has enabled it to sustain as a consistent quality producer over the years.

FINANCE

Your Company continued to focus on operational improvement. Continuing focus on managing optimal levels of inventory, sound business performance, operating efficiencies in various segments of business and cost saving drive across the organization have helped it generating good cash flow from operations, notwithstanding headwinds blowing in automobile sector and sluggish macro-economic environment throughout the year.

Your Company was able to raise the short-term/long term funds needed for its working capital related requirements & term loans for new capital expenditure at competitive rates. Your Company continues to enjoy excellent credit ratings for both long and short tenure borrowings and maintains impeccable debt-servicing track record, which helps it retain excellent rapport with all of its bankers.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of corporate governance and adheres to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under the LODR forms an integral part of this report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

TRANSFER TO GENERAL RESERVE

During the FY under review, no amount has been transferred to General Reserve of the Company.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

During the FY under review, your Company has transferred unpaid/ unclaimed dividend amounting to Rs 6.59 Lacs for FY 2009-10 to the Investor Education and Protection Fund (IEPF) of the Central Government of India.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility Committee (''CSR Committee'') has formulated and recommended to the Board, a Corporate Social Responsibility Policy (''CSR Policy'') indicating the activities to be undertaken by the Company, which has been approved by the Board.

The amount required to be spent on CSR activities during the year under report in accordance with the provisions of Section 135 of the Act was Rs 76.54 lacs and the Company has spent Rs 70.00 lacs during the current financial year.

The Company was in a process to recognize the appropriate CSR project for spending on the CSR expenditure to contribute towards the society and hence the Company could spend only to the extent of Rs 70 lacs and could not spend Rs 6.54 lacs out of Rs 76.54 lacs to be spent towards CSR expenditure.

The requisite details (in a matrix form) on CSR activities pursuant to Section 135 of the Act read with Companies (CSR Policy) Rules, 2014 are annexed as Annexure A to this Report.

POLICY RELATING TO ANTI SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has placed a policy to treat women employees with dignity and no discrimination against them plus zero tolerance towards any sexual abuse to abide by letter and spirit requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules framed there under and redressal of complaints of sexual harassment at work place. All employees (permanent, contractual, temporary and trainees) are supposed to adhere to, and conduct themselves as prescribed in this policy. During the year under review, no complaint was reported to the Board and accordingly the Company has no information to report on filing and disposal of the cases pursuant to Section 22 of the said Act.

DEPOSITS

Your Company has neither accepted nor renewed any deposits within the meaning of Section 73 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 as amended from time to time.

PARTICULARS OF LOANS, GUARANTEES, SECURITIES AND INVESTMENTS

The Company has not given any guarantees or securities within the meaning of the provisions of Section 186 of the Act.

However, the aggregate of loans and advances granted, as also investments made, if any are within the limits of Section 186 of the Act.

STATEMENT ON THE DECLARATION GIVEN BY INDEPENDENT DIRECTORS PURSUANT TO SECTION 149(6) OF THE ACT

The Company has received declaration from all independent Directors of the Company to the effect that they meet criteria of independence as stipulated u/s 149(6) of the Act and applicable regulations of LODR.

DIRECTORS'' RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the Directors would like to state that:

a) In the preparation of the annual accounts financial year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures; if any

b) 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 as at March 31, 2018 and of the profit and loss of the Company for the financial year ended March 31, 2018 under review;

c) The Directors 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;

d) The Directors have prepared the annual accounts for the financial year ended March 31, 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 were operating effectively; and

f) The Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188 OF THE COMPANIES ACT, 2013

There were no related party transactions entered into during the financial year under Section 188 of Companies Act, 2013.

Further, during FY 2017-18, there were no materially significant related party transactions entered into by your Company with the Promoters, Directors, Key Managerial Personnel or other designated persons which might have potential conflict with the interest of the Company at large.

HOLDING / SUBSIDIAY / ASSOCIATE / JOINT VENTURE COMPANY

Thakur Devi Investments Private Limited is a holding company of the Company, holding 74.81 % Equity Share Capital of the Company. The Company will make relevant disclosure during the year in case of change in the current status, if any.

Subsequent to the end of Balance sheet date as at March 31, 2018, the Company has acquired 55% shareholding of Indutch composites Technology Pvt. Ltd. of face value of Rs 10/- each for a consideration of Rs 5.20 Cr. By virtue of this investment, Indutch Composites Technology Pvt Ltd has become a subsidiary of the Company.

AUDIT COMMITTEE RECOMMENDATIONS

During the year, The Board has accepted all recommendations of Audit Committee and accordingly no disclosure is required to be made in respect of non-acceptance of any recommendation of the Audit Committee by the Board.

INTERNAL FINANCIAL CONTROL

The Corporate Governance Policy guides the conduct of the affairs of your Company and clearly delineates the roles, responsibilities at each level of its key functionaries involved in governance. Your Company has in place adequate internal financial controls with reference to the Financial Statements. During the year under review, no reportable material weakness in the operation was observed. Regular audit and review processes ensure that such systems are reinforced on an ongoing basis.

INSURANCE

Your Company''s assets are adequately insured against multiple risks from fire, riot, earthquake, terrorism and other risks, which are considered necessary by the Management.

As an additional coverage, a Public Liability Insurance Policy is also in place to cover public liability/ties, if any, arising out of any industrial accidents. We have also covered, the Directors'' and Officers'' liability under the Companies Act to meet with any eventuality.

RATINGS FOR BORROWING

ICRA, the rating agency has reaffirmed AA- with stable outlook for the long term ratings for bank facilities and A1 the short term rating for short term bank facilities and commercial paper of your Company vide letter dated July 05,2017. The aforesaid rating are valid till June 30,2018.

AUDITORS

(i) Statutory Auditors

The auditors, K.C. MehtaS Co., Chartered Accountants, retire at the conclusion of ensuing Annual General Meeting. They have furnished their consent and requisite certificate pursuant to the Act and rules mentioned there under in respect of their proposed reappointment pursuant to Section 139 of the Act for upcoming financial year 2018-19 & onwards.

(ii) Internal Auditors

M/s Mukund & Rohit, Chartered Accountants, Vadodara, have been appointed as Internal Auditors of the Company in terms of Section 138 of the Companies Act, 2013 and rules and regulations, made thereunder, for the Financial Year 2018-19 by the Board of Directors, upon recommendation of the Audit Committee.

(iii) Secretarial Auditors

Pursuant to provisions of Section 204 of the Act, and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed M/s Devesh Vimal & Co., Company Secretaries in practice to undertake the Secretarial Audit of the Company for FY 2018-19. The Secretarial Audit Report for the financial year ended March 31, 2018 is annexed herewith marked as Annexure C to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

EXPLANATIONS/COMMENTS ON STATUTORY AUDITORS'' REPORT & SECRETARIAL AUDITORS'' REPORT

Neither the Statutory Auditors nor the Secretarial Auditors of the Company, in their respective reports, have made any qualifications, reservations, adverse remarks or disclaimers. Accordingly, no explanations/ comments thereon are required to be furnished.

AUDIT COMMITTEE

The composition of the Audit Committee is in line with the provisions of Section 177 of the Act read with Regulation 18 of LODR. The Chairman of the Audit Committee is an Independent Director. The Audit Committee of the Board provides reassurance to the Board on the existence of an effective internal control environment that ensures the efficiency and effectiveness of the operations of the Company and safeguarding of assets and adequacy of provisions for all liabilities. The details of meetings and their attendance are included in the Corporate Governance Report.

NOMINATION AND REMUNERATION COMMITTEE

The composition of the Nomination and Remuneration Committee (NRC) is in line with the Section 178 of the Act read with Regulation 19 of LODR. The committee determines overall Company''s Policy on remuneration packages and other terms and conditions of the appointment of the Executive Directors and senior management of the Company as well as sitting fees to the Non Executive Directors of the Company and also to approve payment of remuneration to Managing Director and Whole Time Directors as decided by the members of the Company and recommends to the Board of Directors for their consideration and approval. The details of meetings and their attendance are included in the Corporate Governance Report.

STAKEHOLDERS RELATIONSHIP COMMITTEE

The composition of the Stakeholders Relationship Committee (SRC) is in line with the Section 178 of the Act and Regulation 20 of LODR. The Committee looks after the stakeholder''s grievances and redress of investor''s complaints related to transfer of shares, non receipt of balance sheet, non receipt of dividend etc. The details of meetings and their attendance are included in Corporate Governance Report.

REPORTING OF FRAUDS

There have been no instances of fraud reported by the Statutory Auditors under Section 143(12) of the Act and rules framed thereunder either to the Company or to the Central Government.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return in Form MGT-9 annexed to this report as Annexure B.

CODE OF CONDUCT

The Company has laid down a comprehensive Code of Conduct (''Code'') for the Board and senior management personnel of the Company.

The Company has received affirmations from Board members as well as senior management confirming their compliance with the said Code for FY 2017-18.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place in business practices and dealing with stakeholders.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a vigil mechanism/whistle blower policy to deal with instance of fraud and mismanagement, if any. In staying true to our values of strength, performance and passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder''s responsibility.

PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading pursuant to SEBI (Prohibition & Insider Trading) Regulation, 2015 with a view to regulate trading in securities by the Directors and designated employees of the Company.

The Code requires pre-clearance for dealing in the Company''s shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window'' is closed. The Board is responsible for implementation of the code. All Directors and the designated employees have confirmed compliance with the code.

BOARD MEETINGS

Five meetings of the Board of Directors were held during the financial year 2017-18. Details of the composition of the Board and its committees and of the meeting held, attendance of the Directors of such meeting and other relevant details are provided in the Corporate Governance Report.

RISK MANAGEMENT POLICY

The composition of the Risk Management Committee is not applicable to your Company. However, the Company has adopted a Risk Management policy in accordance with the provisions of the Act and Regulation 17 (9) of LODR. It establishes various levels of accountability and overview within the Company, while vesting identified managers with responsibility for each significant risk.

DETAILS OF SIGNIFICANT & MATERIAL ORDERS IMPACTING THE GOING CONCERN STAUS/ COMPANY''S OPERATIONS IN FUTURE

No significant, material orders have been passed by the regulators or courts or tribunals impacting the going concern status of the Company or Company''s operations in future.

THE INFORMATION REQUIRED PURSUANT TO SECTION 197 READ WITH RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014 IN RESPECT OF EMPLOYEES OF THE COMPANY.

Remuneration of KMP and sitting fees paid to Independent Directors are provided in Annexure B i.e. Extract of Annual Return Form No. MGT- 9. There was no employee of the Company except Executive Directors, employed through out the year, who was in receipt of the remuneration exceeding Rs 1.02 Crore per annum.

MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis Report for the year under review as stipulated under Regulation 34 (2)(e) of LODR is enclosed as Annexure E and forms part of this report.

INDUSTRIAL RELATIONS

Industrial relations have remained cordial throughout the year in the Company at all of its units.

ENVIRONMENT, HEALTH, SAFETY AND SOCIAL RESPONSIBILITY

Your Company is committed in maintaining the highest standards of environment compliances and therefore adopted a systematic approach towards environment management by embedding a vision of being an Injury Free'' and ''Zero Environment Incident'' organisation. Over the past many years, your Company has been progressing well in terms of reducing injury frequency rates and has improved the safety records.

Your Company is environment-conscious and committed to making a positive contribution to the communities where it operates. The Company has been proactively pursuing measures and reaching out to the communities surrounding the areas of its operations by extending support and lending a helping hand to some very credible social institutions that are committed to address social causes.

Your Company has been certified for Occupation, Health and Safety (OHSAS) 18001:2007 from Bureau Veritas during FY 2016-17, which is valid for upto 01st May, 2019.

CONSERVATION OF ENERGY / TECHNOLOGY ABSORPTION AS WELL AS FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company, thanks to its collaborations and outward looking approach, is constantly absorbing new technology. This is contributing towards both, improving the manufacturing process and improving our reputation with our customers as we bring technology in our products.

Information in respect of Conservation of energy & foreign exchange earnings and outgo is enclosed in Annexure F.

COMPANY''S POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, senior management and their remuneration.

The requisite details as required under Section 134 (3)(e) and Section 178(3) & (4) of the Act are annexed as Annexure G to this report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY, IF ANY, DURING THE PERIOD FROM MARCH 31, 2018 TO THE DATE OF THE REPORT

There has been no material change/ commitment affecting the financial position of the Company during the period from the end of the financial year on March 31, 2018 to the date of the Report.

STATEMENT ON COMPLIANCES OF APPLICABLE SECRETARIAL STANDARDS

In terms of clause no. 9 of revised SS-1 (Revised Secretarial Standards on Meetings of Board of Directors effective from 01.10.2017), your Directors state that the Company has been compliant to applicable Secretarial Standards during the year under review.

ACKNOWLEDGEMENTS

The Board of Directors express their sincere thanks to all of its Stakeholders, including, inter alia, Suppliers, Vendors, Investors and Bankers and appreciation to all its customers for their consistent, abiding support throughout the year.

Your Company also records its appreciation of the contributions made by employees at all levels. Their commitment, cooperation and support are indeed the backbone of all endeavors of the Company.

The Company would like to acknowledge Government of India, Customs and Excise Departments, Income Tax Department, Industrial & Labour Departments, Government of Gujarat, Government of Haryana, Government of Uttarakhand and other government agencies for the support; the Company has been receiving over the years and is looking forward to their continued support/guidance in times to come.

For and on behalf of the Board of Directors

Munjal Auto Industries Limited

Sudhir Kumar Munjal

Date : May 28,2018

Chairman & Managing Director

Place : Waghodia, Vadodara

DIN : 00084080

ANNEXURE A TO THE BOARD''S REPORT

Annual Report on CSR Initiatives

1. A brief outline of the Company''s CSR policy, including overview of projects or programmes undertaken and a reference to the web-link to the CSR policy and projects or programmes.

The Company has framed a CSR policy in compliance with the provisions of the Companies Act, 2013 and the same is available on the web link http://www.munjalauto.com/pdf/CSR%20Policy.pdf. The CSR policy, interalia, covers the concept (CSR philosophy, snapshot of activities undertaken by the Company and applicability, scope (area/localities to be covered and activities), resources, identification and approval process (resources/fund allocation, identification process and approval process) modalitiesof execution and implementation and monitoring.

2. Composition of the CSR Committee: Mr. Vikram Shah, Chairman

Mr. Naresh Kumar Chawla, Member Mr. Sudhir Kumar Munjal, Member Mrs. Anju Munjal, Member Mr. Anuj Munjal, Member

3. Average net profit of the company for last three financial years Rs 38.27 Crore

4. Prescribed CSR Expenditure (two per cent of the amount as in item 3 above): Rs 76.54 Lacs

5. Details of CSR spent during the financial year:

a) Total amount to be spent for thefinancial year Rs 76.54 Lacs

b) Amount spent: Rs 70.00 Lacs

c) Amount unspent: Rs 6.54 Lacs

d) Manner in which the amount spent during the financial year is detailed below:

1

2

3

4

5

6

7

8

sl.

No.

CSR Project or Activity identified

Sector in which the project is covered

Projects or programs (1) Local area or other (2) Specify the state and district where projects or programs was undertaken

Amount outlay (budget) project or programs wise (Rs)

Amount spent on the projects or programs sub-heads (1) Direct Expenditure on projects or programmes (2) Overheads (Rs)

Cumulative expenditure upto the reporting period (Rs)

Amount spent: Direct or through implementing agency*

1

Promoting education for impaired/disabled

Education and employment

Vadodara, Gujarat

2,00,000

2,00,000

2,00,000

Agency:Akshar Trust Vadodara , Gujarat

2

Old age home to look after homeless -abandoned senior citizens

Health Care

New Delhi

5,00,000

5,00,000

5,00,000

Agency: The Earth Saviours Foundation, New Delhi

3

Special Education, medical intervention including preventive health care in Disability/Social Sector

Education and Health care

Vadodara, Gujarat

12,00,000

12,00,000

12,00,000

Agency: Disha Charitable Trust, Vadodara, Gujarat

4

Health improvement

Health Care

Sabar Kaantha, Gujarat

39,00,000

39,00,000

39,00,000

Agency :Vaanprastha Saadhak Aashram, Sabar Kaantha, Gujarat

5

Promoting education to orphans

Education

Kutch Gandhidham, Gujarat

7,00,000

7,00,000

7,00,000

Agency-Arya Samaj Gandhi Dham, Kutch, Gandhidham, Gujarat

6

Assistance to be paid in case of accidents taking place in or outside State & related matters

Chief Minister of Gujarat Relief Fund

India

5,00,000

5,00,000

5,00,000

Agency: Revenue Department, Government of India.

Total

70,00,000

70,00,000

70,00,000

6. The Company was in a process to recognize the appropriate CSR project for spending on the CSR expenditure to contribute towards the society and hence the Company could spend only to the extent of Rs 70 lacs and could not spend Rs 6.54 lacs out of Rs 76.54 lacs to be spent towards CSR expenditure.

7. Responsibility Statement

CSRcommittee confirms that the implementation and monitoring of the CSR Policy is in compliance with the CSR objectives and policy of the Company.

Place :

Waghodia, Vadodara

Vikram Shah

Sudhir Kumar Munjal

Date

: May 28,2018

Chairman-CSR Committee

Chairman & Managing Director

DIN: 00007914

DIN: 00084080

ANNEXURE B TO BOARD''S REPORT

FORM NO. MGT.9

EXTRACT OF ANNUAL RETURN as on the financial year ended on 31.03.2018

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

i)

CIN

L34100GJ1985PLC007958

ii)

Registration Date

12-07-1985

iii)

Name of the Company

Munjal Auto Industries Limited

iv)

Category / Sub-Category of the Company

Company Limited by shares

v)

Address of the Registered office and contact details

187, GIDC Industrial Estate, Waghodia, Vadodara - 391760
Tel. No. (02668) 262421-22, Fax No. (02668) 262427

vi)

Whether listed Company Yes / No

Yes

Name, Address and Contact details of Registrar and Transfer Agent, if any

MCS Share Transfer Agent Limited,

vii)

1st Floor, Neelam Apartment,88, Sampatrao Colony,

Above Chappanbhog Sweet, Alkapuri, Vadodara- 390 007

Tel.: (0265) 2314757; Fax: (0265) 2341639

E-mail: mcsltdbaroda@gmail.com

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the Company shall be stated:-

SI.

Name and Description of main products / services

NIC Code of the

% to total turn over

No.

Product /service

of the Company

1

Manufacture of Diverse Parts And Accessories For Motor Vehicles

29301

93%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

s.

No

Name and Address of the Company

CIN

HOLDING/ ASSOCIATE

%of shares held

Applicable Section

1

Thakurdevi Investments Private Limited, Hero Nagar, G. T Road, Ludhiana-141003

U65921PB1979PTC004044

Holding Company

74.81%

2(87)(ii)

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding

Category of Shareholders

No. of Shares held at the beginning of the year (Ason31-March-2017)

Mo. of Shares held at the end of the year (Ason31-March-2018)

% Change during the year

Demat

Physical

Total

% of Total Shares

Demat

Physical

Total

% of Total Shares

A. Promoters

(1) Indian

a) Individual/ HUF

-

-

-

-

-

-

-

-

-

b) Central Govt

-

-

-

-

-

-

-

-

-

c) State Govt (s)

-

-

-

-

-

-

-

-

-

d) Bodies Corp.

3,74,03,225

-

3,74,03,225

74.81

7,48,06,450

-

7,48,06,450

74.81

0.00

e) Banks/FI

-

f) Any Other..

-

Sub-total (A) (1):-

3,74,03,225

-

3,74,03,225

74.81

7,48,06,450

-

7,48,06,450

74.81

0.00

Category of Shareholders

No. of Shares held at the beginning of the year (Ason31-March-2017)

to. of Shares held at the end of the year (Ason31-March-2018)

% Change during the year

Demat

Physical

Total

% of Total Shares

Demat

Physical

Total

% of Total Shares

(2) Foreign

a) NRIs - Individuals

.

.

.

.

.

.

.

.

.

b) Other - Individuals

-

-

-

-

-

-

-

-

c) Bodies Corp.

-

-

-

-

-

-

-

-

d) Banks / Fl

-

-

-

-

-

-

-

-

-

e) Any Other....

-

-

-

-

-

-

-

-

-

Sub-total (A) (2):-

-

-

-

-

-

-

-

-

-

Total shareholding

3,74,03,225

3,74,03,225

74.81

7,48,06,450

7,48,06,450

74.81

shareholding of Promoter (A)=(A)(1HA)(2)

B. Public Shareholding

1. Institutions

a) Mutual Funds

24,828

500

25,328

0.05

51,511

1,000

52,511

0.05

-

b) Banks/FI

14,436

24,955

39,391

0.08

20,155

48,910

69,065

0.07

1

c) Central Govt

d) State Govt(s)

-

- I

e) Venture Capital Funds

-

-

-

-

-

-

-

-

-

f) Insurance Companies g) Flls / FPIs

-

-

-

-

29,783

-

29,783

0.03

0.03

-

-

-

-

-

-

h) Foreign Venture

-

-

-

-

-

-

-

-

-

Capital Funds

i) Others (specify)

-

25,455

64,719

0.13

1,01,449

-

1,51,359

0.15

;

Sub-total (B)(1):-

39,264

49,910

2. Non-Institutions

a) Bodies Corp.

i) Indian

12,01,951

29,500

12,31,451

2.46

23,88,932

50,000

24,38,932

2.44

-0.02

ii) Overseas

-

-

-

-

-

-

-

-

-

b) Individuals

80,42,760

18,37,762

i) Individual shareholders

12,62,815

93,05,575

18.61

1,57,14,992

1,75,52,754

17.55

-1.06

holding nominal share capital upto Rs 1 lakh

ii) Individual shareholders holding nominal share capital in excess of Rs 1 lakh

11,19,627

11,19,627

2.24

26,11,641

26,11,641

2.61

0.37

c) Others (specify)

-

-

-

-

-

-

-

-

-

Non Resident Indians

2,44,216

27,000

2,71,216

0.54

6,50,397

13,500

6,63,897

0.66

0.12

HUF

6,01,787 2,400

-

6,01,787 2,400

1.20 0.005

11,44,497 7,900 6,22,570

-

11,44,497 7,900 6,22,570

1.14 0.01 0.62

-0.06 0.005 0.62

Trust

-

IEPFA

I

.

.

-

Sub-Total (B)(2):-

1,12,12,741 13,19,315

1,25,32,056

25.06

2,31,40,929

19,01,262

2,50,42,191

25.04

.

Total Public Shareholding (B)=(B)(1HB)(2)

1,12,52,005 13,44,770

1,25,96,775

25.19

2,32,42,378

19,51,172

2,51,93,550

25.19

.

|

C. SHARES HELD BY CUSTODIAN FOR GDRS & ADRS

4,86,55,230,13,44,770,5,00,00,000, 100 ,9,80,48,828

10,00,00,000, 100 , -

Grand Total (A B C)

19,51,172

(ih Shareholdina of Promoters

s.

No.

Shareholder''s Name

Shareholding at the beginning of the year (As on 01. 04.201 7)

Share holding at the end of the year (As on 31. 03.201 8)

% change in share holding during the year

1

Thakurdevi Investments Private Limited

No. of Shares

3,74,03,225

%of total Shares of the company

74.81%

% of Shares Pledged/ encumbered to total shares

NIL

No. of Shares

7,48,06,450

%of total Shares of the company

74.81%

% of Shares Pledged/ encumbered to total shares

NIL ,

NIL

Total

3,74,03,225

74.81%

NIL

7,48,06,450

74.81% NIL NIL

(iii) Change in Promoters'' Shareholding (please specify, if there is no change)

S. No.

Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

% of total shares of the company

No. of shares

% of total shares of the company

1

At the beginning of the year

3,74,03,225

74.81%

3,74,03,225

74.81%

2

Increase in holding of Promoters by issue of Bonus Shares as on July 13, 2017

NIL

Nil

3,74,03,225

Nil

3

At the End of the year

3,74,03,225

74.81%

7,48,06,450

74.81%

Shareholding of Directors and Key Managerial Personnel

S. Shareholding at the Cumulative Shareholding No. beginning of the year during the year

Shareholding of each Directors and KMP At the beginning of the year

No. of shares

% of total shares of the company

No. of shares

% of total shares of the company

1 2

Mrs. Anju Munjal, WTD

311

0.0006

311

0.0006

Mr. Naresh Kumar Chawla, Director

250

0.0005

250

0.0005

Increase in holding of Directors and Key Managerial Personnel by issue of Bonus Shares as on July 13, 2017:

1

Mrs. Anju Munjal, WTD

311

0.0006

311

0.0006

2

Mr. Naresh Kumar Chawla, Director

250

0.0005

250

0.0005

1

At the End of the year

Mrs. Anju Munjal, WTD

622

0.0006 0.0005

622

0.0006

2

Mr. Naresh Kumar Chawla, Director

500

500

0.0005

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment

Indebtedness at the beginning of the financial year (01. 04.201 7)

Secured Loans excluding deposits

Unsecured Loans

Deposits

Total Indebtedness

i)

Principal Amount

44,42,29,392

-

-

44,42,29,392

ii)

Interest due but not paid

-

-

-

-

iii)

Interest accrued but not due

39,17,690

-

-

39,17,690

Total (i ii iii)

44,81,47,082

-

! 44,81,47,082

Change in Indebtedness during the financial year

I

Addition

-

-

-

-

Reduction

15,79,96,929

-

-

15,79,96,929

Net Change

15,79,96,929

-

-

15,79,96,929

Ind fine

ebtedness at the end of the ncial year (31. 03.201 8)

i)

Principal Amount

28,76,53,915

-

-

28,76,53,915

ii)

Interest due but not paid

-

-

-

-

iii)

Interest accrued but not due

24,96,238

-

-

24,96,238

Total (i ii iii)

29,01,50,153

i

29,01,50,153 i i

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager

s.

Particulars of Remuneration

Name of MD/WTD/ Manager

(Rs In Lacs)

No

1.

Gross salary

Mr. Sudhir Kumar Munjal - CMD

Mrs. Anju Munjal -WTD

Mr. Anuj Munjal -WTD

Total Amount

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

238.28

168.80

207.97

615.05

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961

1.72

41.20

2.03

44.95

(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961

_

_

-

-

2.

Stock Option

-

-

-

-

3.

Sweat Equity

-

-

-

-

4.

Commission

as % of profit

-

-

-

-

others, specify...

-

-

-

-

5.

Others, please specify

a) Company''s contribution to the provident Fund

14.40

12.60

12.60

39.60

b) Company''s contribution to Superannuation scheme

12.00

10.50

10.50

33.00

c) Gratuity

5.77

5.05

5.05

15.87

Total (A)

272.17

238.15

238.15

748.47

Ceiling as per the Act

748.47 ,

Remuneration to other Directors

Rs In Lacs)


S.

Particulars of Remuneration No.

Name of Directors

Independent Directors

Mr. Vikram

Mr. Naresh

Mr. Mahendra

Mr. Ramkisan

Mr. Sudesh

Mr. Jal Ratanshaw

Total Amount

Shah

Kumar Chawla

Sanghvi

Devidayal

Kumar Duggal

Patel

Fee for attending Board/ Board committee meetings

4.72

3.40

3.60

3.80

2.20

1.40

19.12

Commission

-

Others, please specify

-

Total (1)

4.72

3.40

3.60

3.80

2.20

1.40

19.12

4. Other Non-Executive Directors

Fee for attending board committee meetings

-

-

-

-

-

Commission

-

-

-

-

-

Others, please specify

-

-

-

-

-

-

-

Total (2)

-

-

-

-

-

Total (B) = (1 2)

4.72

3.40

3.60

3.80

2.20

1.40

19.12

Total Managerial Remuneration

4.72

3.40

3.60

3.80

2.20

1.40

19.12

Overall Ceiling as per the Act

19.12 |

C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD / MANAGER / WTD

(Rs In Lacs)

s.

Particulars of Remuneration

Key Managerial Personnel

No

1.

Gross salary

CEO

Company Secretary

CFO

Total

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

17.36

44.91

62.27

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961

-

-

-

-

2.

(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961

-

-

-

-

3.

Stock Option

-

-

-

-

Sweat Equity

-

-

-

-

4.

Commission

as % of profit

-

-

-

-

others, specify...

-

-

-

-

5.

Others, please specify

a) Company''s contribution to the provident Fund

-

0.86

2.36

3.22

b) Company''s contribution to Superannuation Fund

-

0.71

1.96

2.67

c) Gratuity

-

0.35

0.95

1.30

Total

-

19.28

50.18

69.46

VII. PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES

Type

A. COMPANY

Section of the Companies Act

Brief Description

Details of Penalty/ Punishment/ Compounding fees imposed

Authority [RD/NCLT/ COURT]

Appeal made, if any (give Details)

Penalty

-

-

-

-

-

Punishment

-

-

None

-

-

Compounding

-

-

-

-

-

B. DIRECTORS

Penalty

-

-

-

-

-

Punishment

-

-

None

-

-

Compounding

-

-

-

-

-

C. OTHER OFFICERS IN DEFAULT

Penalty

-

-

-

-

-

Punishment

-

-

None

-

-

Compounding

-

-

-

-

-

For and on behalf of the Board of Directors

Date : May 28, 2018

Sudhir Kumar Munjal

Place : Waghodia, Vadodara

Chairman & Managing Director

DIN: 00084080

ANNEXURE D TO THE BOARD''S REPORT

Details as per Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

S.N.

Particulars

Executive Director

i.

The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year

CMD

WTD

WTD

101

88

88

X

I

X

ii

The % increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manger, if any of the Financial Year

Executive Directors

KMPs

CMD 29.90%

WTD 24.79%

WTD 25.66% ''

CFO CS 0.09% 12.09%

iii

The % increase in the median remuneration of employees in the financial year

9.53%

iv.

The number of permanent employees on the rolls of Company

1168

v

The explanation on the relationship between average increase in remuneration and Company performance

Annual Increase in remuneration is based on the remuneration policy for different grades, industry pattern, qualifications and experience, responsibilities shouldered and individual performance of the Key Managerial personnel & other employees and also performance of the Company.

vii

Comparison of the remuneration of the Key Managerial Personnel against the performance of the Company

vii.

Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer

Market Capitalization PE Ratio Last Public Offer

2017-18

? 713.00 C 17.14 NA

2016-17

r. Rs 504.00 Cr. 15.87 NA

viii.

Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration

% Increase in

2017-18

Justification/ Remarks

Salaries of Employees

15.15%

Managerial Remuneration

26.88%

ix.

Comparison of the each remuneration of the Key Managerial Personnel against the performance of the Company

Particulars

% of Net Sales for F.Y 201 7-1 8

CMD

0.26%

WTD

0.23%

WTD

0.23%

CFO

0.05%

CS

0.02%

X

The key parameters for any variable component of remuneration availed by the Directors

Key parameters of Whole time Directors'' variable remuneration includes components like incentive on growth of top-line and growth in profitability.

Xi

The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year and

NOT APPLICABLE

xii.

Affirmation that the remuneration is as per the remuneration policy of the Company.

Remuneration is as per the remuneration policy of the Company.

ANNEXURE CTO THE BOARD''S REPORT

SECRETARIAL AUDIT REPORT

Form No. MR-3 FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2018

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014]

To,

The Members,

Munjal Auto Industries Ltd,

187, GIDC Industrial Estate

Waghodia

Dist: Baroda-391760

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices bythe Company. Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/ statutory compliances and expressing our opinion thereon.

Based on our verification of MUNJALAUTO INDUSTRIES LIMITED''s books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, we hereby report that in our opinion, the Company has, during the audit period covering the financial year ended on 31st March, 2018, complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter.

We have examined the books, papers, minutes books, forms and returns filed and other records maintained by the Company for the financial year ended on 31st March, 2018 according to the provisions of:

(i) The Companies Act, 2013 (''the Act'') and the rules made thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 (''SCRA'') and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (''SEBI Act''):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999;

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and (h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

(vi) Having regard to the products, processes and locations of the Company as also having regard to the compliance system prevailing in the Company and on examination of the relevant documents and records in pursuance thereof, on test check basis, we further report that the Company has complied with the following laws applicable specifically to the Company:

1. The Environment (Protection) Act, 1986

2. The Air (Prevention And Control of Pollution) Act, 1981

3. The Water (Prevention and Control of Pollution) Act, 1974

4. The Hazardous Wastes (Management and Handling and Trans-boundary Movement) Rules, 1989

5. Indian Boiler Regulations Act, 1950

6. The Static and Mobile Pressure Vessels (unfired) Rules, 1981 [SMPV(U) Rules]

7. Indian Explosives Act, 1884

We have also examined compliance with the applicable clauses of the following: (i) Secretarial Standards issued by The Institute of Company Secretaries of India.

(ii) The Listing Agreements entered into by the Company with BSE Ltd. and National Stock Exchange of India Ltd. including The Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015 (''LODR'').

We further report that

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and Independent Directors. Adequate notice is given to all Directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. Majority decision is carried through while the dissenting members'' views, if any, are captured and recorded as part of the minutes.

We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

We further report (by way of information) that during the audit period:

(a) The Company has issued Bonus shares of Rs 2/- each fully paid up for every one Equity Share of Rs 2/- each fully paid up as on the record date July 12, 2017 aggregating to 5,00,00,000 Equity Shares of Rs 10,00,00,000 to the members of the Company pursuant to the approval granted by the members of the company at their 32nd Annual General Meeting during the period under review.

(b) The Company has not issued any Debt bearing securities during the period under review and accordingly

The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2009 were not applicable.

(c) The Company has not issued any stock options to the employees and accordingly. The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 were not applicable.

(d) The Company has neither got delisted Equity Shares nor bought back any security of the Company and accordingly

The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 and The Securities and Exchange Board of India (Buyback of Securities ) Regulations, 1998 were not applicable during the audit period.

(e) Secretarial Standards (SS-1 and SS-2) issued by the Institute of Company Secretaries of India mandatorily applicable during the audit period were complied with.

For Devesh Vimal & Co.

Practising Company Secretaries

Date : May 25, 2018

CS Devesh A. Pathak

Place : Vadodara

Partner

PCS: 4559

CP No. 2306

Director’s Report