The Directors have pleasure in presenting the Forty First Report together with the Audited Accounts of your Company for the year ended 31st March 2018.
The highlights of the performance of your Company during the fiscal are given hereunder;
(All figures in Rs. Lakhs)
Profit before Tax
Less: Tax expense
Profit from continuing operations
Loss from discontinuing operations
Profit/loss for the period
Transition To Indian Accounting Standards (Ind As)
The Ministry of Corporate Affairs (MCA), vide its notification in the Official Gazette dated February 16, 2015, notified the indian Accounting standards (ind As) applicable to certain classes of Companies. ind As has replaced the existing indian GAAP prescribed under section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014. For the Company, ind As is applicable from April 1, 2017, with a transition date of April 1, 2016.
The following are the areas which had an impact on account of transition to ind As:
- Revenue recognition
- Employee costs pertaining to defined benefit obligations
- Recognition of dividend liability and related taxes
- Deferred taxes
- Classification of Fixed Assets
The reconciliations and descriptions of the effect of the transition from iGAAP to ind As have been provided in the notes to accounts in the financial statements.
Operations / Performance review
Net sales of your company decreased to Rs. 45.32 Crores in FY 18 from Rs.131.61 Crores in FY 17. This is due to some large value of tenders for drilling equipment were inordinately delayed during FY 18.
Due to lower sales, profitability declined in FY 18.
Change in the Nature of Business, if any
There was no change in the nature of business of the Company during the financial year ended 31st March, 2018 Management discussion and analysis, Structure and Developments, Opportunities andThreats, Outlook, Risk and Concern: Overview of the Economy india has emerged as the fastest growing major economy in the world as per the Central statistics Organisation (CsO) and international Monetary Fund (iMF) and it is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships. india’s GDP is estimated to have increased 6.6 per cent in 2017-18 and is expected to grow 7.3 per cent in 2018-19.
Business Environment, Outlook & Prospects for FY 2018-19.
Coal india Ltd (CiL) reported that it has missed the production target for 2017-18 (FY 18) by five per cent but it achieved a 2.4 per cent growth in the fuel production over last year.
According to its provisional data, CiL produced 567.37 mt in FY 18, achieving 95 per cent of its targetof 600 mt for the year. However, it achieved a 2.4 per cent growth in production as compared to 554.13 mt produced in FY17.
The total coal demand in the country is expected to be around 1.2-1.5 BT as per various estimates by the government and independent agencies. Considering this, the Ministry of Coal, Government of india, has set up a target of more than doubling the coal production in the country and reach a production level of 1.5 BT by FY 2020. To achieve this, the government has set a target of increasing coal production of Coal india Limited (CiL) to a level of 1 BT by FY 2020, while the balance production is to be met by SCCL, the private sector, state sector and central sector PSUs.
With this positive outlook, it is expected that the there will be growth in demand for the Company’s products in the years to come. Transfer to reserves
The Company has not transferred any amount to its reserves during the year under review.
No dividend has been declared in the financial year under review having regard to results of the year.
Transfer of unclaimed dividend to Investor Education and Protection Fund
Since there was no unpaid/unclaimed Dividend, the provisions of Section 124 & 125 of the Companies Act, 2013 relating to transfer of Unclaimed dividend to investor Education and Protection fund does not arise.
The issued, subscribed and paid-up share capital of the Company as at 31.03.2018 stood at ‘ 3,06,69,430 /- divided into 30,66,943 equity shares of ‘ 10/- each. During the year under review the Company has not made any fresh issue of shares.
Extract of annual return
The extract of Annual Return pursuant to the provisions of Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, is furnished in Annexure A and is attached to this report.
Board meetings conducted during the period under review
During the year under review, 6 Meetings of the Board of Directors, 6 Meetings of the Audit Committee, 3 Meetings of the Nomination and Remuneration Committee, 4 Meetings of the Stakeholders Relationship Committee were held. Further details of the same have been enumerated in the Corporate Governance Report annexed herewith.
Statement on compliance with Secretarial Standards
The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively. The Company has duly complied with the Secretarial Standards issued by the institute of Company Secretaries of india on meeting of the Board of Directors (SS-1) and General Meeting (SS-2)
Directors’ Responsibility Statement
Pursuant to the provisions of Section 134(3)(c) of the Companies Act 2013, with respect to Directors’ Responsibility Statement, the Board hereby confirm that -
a) in the preparation of the annual accounts, the applicable accounting standards had been followed and there were no material departure from those standards;
b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for that period;
c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d) the directors had prepared the annual accounts on a going concern basis; and
e) the directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) the directors had devised proper system to ensure compliance with the provisions of all the applicable laws and such systems were adequate and operating effectively;
Details in respect of frauds reported by auditors under section 143(12) of the Companies Act, 2013 other than those which are reportable to the Central Government
There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.
Declaration of independent directors
The independent directors have submitted their disclosures to the Board that they fulfill all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to be appointed as independent directors under the provisions of the Companies Act, 2013 and the relevant rules and SEBi (Listing Obligations and Disclosure Requirements) Rules 2015
Company’s policy relating to directors appointment, payment of remuneration and other matters provided under section 178(3) of the Companies Act, 2013
The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for fixing and revising remuneration of Directors, Key Managerial Personnel, Senior Management Personnel and employees of the Company. The Remuneration policy of the Company is annexed herewith as Annexure B and can also be accessed on the Company’s website at the link http://www.revathi.in/wp-content/themes/rel/pdf/Nomination-Remuneration-Policy.pdf
Comments on Auditors’ Report:
There are no qualifications, reservations or adverse remarks or disclaimers made by M/s. S.S. Kothari Mehta & Co., Statutory Auditors and Mr. M.D. Selvaraj, Proprietor of MDS & Associates, Secretarial Auditor in their report.
The Company has maintained cost records as required under Section 148 of the Companies Act, 2013.
Particulars of loans, guarantees or investments made under Section 186 of the Companies Act, 2013
During the year under review the Company has not granted any loan or made any investment pursuant to the provisions of Section 186 of the Companies Act, 2013. However, the Company has given corporate guarantee for a value of Rs 15 Crores to a bank for the facility availed by its subsidiary M/S Semac Consultants P.Ltd. The details in respect of investments made by the Company in the earlier year have been disclosed in the notes to the Financial Statements.
Particulars of contracts or arrangements with related parties
There was no contract or arrangements made with related parties as defined under Section 188 of the Companies Act, 2013 during the year under review.
Material changes and commitments affecting the financial position of the company:
There have been no material changes and commitments affecting the financial position of the Company which has occurred between the financial year ended 31st March, 2018 and the date of the report.
Conservation of energy, technology absorption, foreign exchange earnings and outgo
The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished in Annexure C and is attached to this report.
Statement concerning development and implementation of risk management policy of the company
The Company has been addressing various risks impacting the business of the Company and risk mitigation measures are being taken then and there.
Lower than expected GDP growth in infrastructure sector, particularly in coal and construction segment may impact your company’s prospects.
Details of policy developed and implemented by the company on its corporate social responsibility initiatives.
The Corporate Social Responsibility (CSR) Committee comprises of three Directors namely 1. Mr.Abhishek Dalmia, 2. Mr.B.V.Ramanan and 3. Mr. V.V.Subramanian as members. The Company’s CSR objective is to promoting education, including special education and employment enhancing vocational skills to children, women and differently abled persons, measures for the benefit of armed forces, war widows etc . The Company has developed Corporate Social Responsibility policy in line with the activities mentioned in Schedule Vii of the Companies Act, 2013. The company has done CSR spending in FY 18 - ie., contribution of Rs 17.50 lakhs to Bharat Ke Veer Corpus , Ministry of Home Affairs, Government of india benefiting the families of war widows, including education of their children. The annual report on CSR activities has been given in Annexure D
Annual evaluation of the Board on its own performance and of the individual directors and committees.
On the advice of the Board of Directors, the Nomination and Remuneration Committee of the Board of Directors of the Company formulated a criteria for evaluation of the performance of the Board of Directors & its committees, independent Directors, Nonindependent Directors and the Executive Chairman/Whole-time Director of the Board. Based on that, performance evaluation has been undertaken. The independent Directors of the Company have also convened a separate meeting for this purpose.
Directors & Key Managerial Personnel
Mrs.Deepali Dalmia (holding DiN: 00017415), Director of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible offers herself for re-appointment. Your Directors recommended her re-appointment.
Mr. Chaitanya Dalmia and Mr. S.C.Katyal have resigned from the Directorship with effect from 31.03.2018 and 08.06.2018 respectively. Directors wish to place on record its appreciation and gratitude for the outstanding contribution and the valuable services rendered by them during their tenure of office as directors of the company.
The Board of Directors has appointed Mr.sunil Puri as CEO & Executive Director of the company from 01.04.2018 to 31.03.2023. on the terms and conditions as set out in the notice convening the Annual General Meeting. Necessary resolution in this regard has been proposed for the approval of the members at the ensuing Annual General Meeting.
Mr.s.Hariharan (DiN: 06363724) Whole-time Director & CFO retired from the services with effect from 08.06.2018. The Board recorded its appreciation and gratitude for the outstanding contribution made by him during his 26 years of service in the Company including his Whole-time Directorship in the last five years and 10 months.
Mr.M.N. srinivasan, Company secretary retired from the services of the Company with effect from 29.07.2018. The Directors wish to place on record its appreciation and gratitude for the valuable services rendered by him during his 23 years of service in the Company.
Key Managerial Personnel of the Company as required pursuant to section 2(51) and 203 of the Companies Act, 2013 are Mr.Abhishek Dalmia, Executive Chairman, Mr. sunil Puri, CEO & Executive Director.
Mr.R. sudhir has been appointed as Chief Financial Officer of the Company with effect from 09.06.2018.
Subsidiaries, Joint Ventures and Associate companies.
The company has two subsidiaries namely M/s semac Consultants Private Ltd - a material subsidiary within the definition of sEBI (Listing Obligations and Disclosure Requirements) Rules 2015 and M/s semac and Partners, LLC - step down subsidiary. Further, the company is a subsidiary of M/s Renaissance Advanced Consultancy Ltd.
A report containing the salient features of the subsidiaries and joint ventures as required under section 129(3) of the Companies Act 2013 has been annexed herewith in AOC - 1 and is attached as Annexure E to this report.
The policy on determination of material subsidiaries of the company as approved by the Board of Directors has been uploaded on the website of the Company and can be accessed at the link http://www.revathi.in/wp-content/themes/rel/pdf/Material-subsidiary-Policy.pdf.
The consolidated financial statements of the company and its subsidiaries were prepared in accordance with the applicable accounting standards have been annexed to the Annual Report.
The annual accounts of the subsidiary companies are posted on the website of the Company viz. www.revathi.in and will also be kept open for inspection by any shareholder at the Registered Office of the Company. The Company shall also provide the copy of the annual accounts of subsidiary companies to the shareholders upon their request.
The Company has not accepted any fixed deposit and hence there are no unclaimed deposits as on 31st March 2018.
Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operation in future
There is no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and company’s operation in future.
Adequacy of Internal Financial Controls with reference to the financial statements
The Company has implemented and evaluated the internal Financial Controls which provide a reasonable assurance in respect of providing financial and operational information, complying with applicable statutes and policies, safeguarding of assets, prevention and detection of frauds, accuracy and completeness of accounting records. Further, the Board annually reviews the effectiveness of the Company’s internal control system. The Directors and Management confirm that the internal Financial Controls (iFC) are adequate with respect to the operations of the Company. A report of Auditors pursuant to section 143(3)(i) of the Companies Act, 2013 certifying the adequacy of internal Financial Controls is annexed with the Auditors report.
M/s. s.s. Kothari Mehta & Co (Firm Registration No. 000756N), Chartered Accountants, New Delhi were appointed as the statutory Auditors of the company for a period of five years at the 38th Annual General Meeting of the company held on 21st December 2015. Pursuant to the amendment of section 139 of the Companies Act, 2013, the Company is no longer required to seek the ratification of the appointment of the Auditor at every Annual General Meeting. Accordingly, it has been proposed to obtain the approval of the members to continue the appointment of the statutory Auditors without ratification of their appointment at every Annual General Meeting.
The Company has received a certificate from the statutory Auditors to the effect that their continued appointment as the statutory Auditors of the Company, would be within the limits prescribed under section 139 of the Companies Act, 2013. Members are requested to grant their approval for the continuation of the appointment of the Auditors for a period up to the conclusion of the 43rd Annual General Meeting of the Company which ought to be held during the year 2020 without ratification at every Annual General Meeting.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr.M.D.Selvaraj, MDS & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The report of the Secretarial Auditor is annexed herewith as Annexure G to this report.
Particulars of Employees
The disclosure as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed herewith as Annexure F and is attached to this report.
Disclosure under the Sexual Harassment of Women at Work Place (Prevention, Prohibition and Redressal) Act, 2013.
The Company has been employing women employees in various cadres within the Office / factory premises. The Company has in place an Anti -harassment policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. There was no compliant received from any employee during the financial year 2017-18 and hence no complaint is outstanding as on 31.03.2018 for redressal.
A report on Corporate Governance is annexed and forms part of this report. The Company has complied with the conditions relating to Corporate Governance as stipulated in Regulation 27 of SEBi (Listing Obligations & Disclosure Requirements) Regulations, 2015.
Audit Committee is in existence in accordance with the provisions of Section 177 of the Companies Act, 2013. Kindly refer to the Section on Corporate Governance, under the head, ‘Audit Committee’ for matters relating to the composition, meetings, and functions of the Committee. The Board accepted the Audit Committee recommendations during the year whenever required, hence no disclosure required under Section 177(8) of the Companies Act, 2013 with respect to rejection of any recommendations of Audit Committee by Board.
Vigil Mechanism (Whistle Blower Policy)
The Company has provided for adequate safeguards to deal with instances of fraud and mismanagement and to report concerns about unethical behavior or any violation of the Company’s code of conduct. The policy can be accessed on the Company’s website at http://www.revathi.in/wp-content/themes/rel/pdf/Whistle-Blower-Policy.pdf
As required under SEBi (Listing Obligations and Disclosure Requirements) Rules 2015, the Executive Director & Chief Executive Officer and Chief Financial Officer have furnished necessary certificate to the Board on the financial statements presented.
Your company realizes that it has to re-orient its organization as dynamics of business are changing fast. The company is taking steps to retain its talent pool, enhance skill of existing people and recruit the most suited talent to spearhead its growth initiatives.
Certain statements in “management discussions and analysis” section may be forward looking and are stated as required by law and regulations. Many factors, both external and internal, may affect the actual results which could be different from what the directors envisage in terms of performance and outlook.
The Directors express their sincere appreciation of dedicated efforts put in by our employees. The Directors also place on record their appreciation of the continued support and recognition provided by our esteemed customers and bankers.
By Order of the Board
For Revathi Equipment Limited
Place : New Delhi Abhishek Dalmia
Date : 06.08.2018 Executive Chairman