The Directors have pleasure in presenting before you the forty Sixth Annual Report of the Company together with the Audited Financial Statements of the Company for the year ended 31 March 2022.
FINANCIAL RESULTS
The performance during the period ended 31 March 2022 has been as under:
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Rs. in Crores
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|
Particulars
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Standalone
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Consolidated
|
| |
2021-22
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2020-21
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2021-22
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2020-21
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|
Total revenue
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3357.14
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2753.41
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3433.47
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2823.16
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|
Profit before depreciation/amortisation, finance costs and tax
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68.19
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227.69
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73.55
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232.24
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|
Less : Finance costs
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31.46
|
30.51
|
31.76
|
30.91
|
|
Less : Depreciation and amortization
|
113.45
|
100.41
|
115.45
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102.42
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|
Profit/(Loss) before Tax
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(76.72)
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96.77
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(73.66)
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98.91
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Less : Current Tax
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(3.41)
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37.38
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(3.40)
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37.63
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Less Deferred Tax (net)
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(22.10)
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(2.83)
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(22.10)
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(2.83)
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Profit/(Loss) after Tax
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(51.21)
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62.22
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(48.16)
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64.11
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|
Other comprehensive income/(loss)
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|
|
|
|
|
Items that will not to be classified to profit or loss -
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|
|
|
|
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- Re measurements of defined benefit plan
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0.97
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(0.68)
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0.97
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(0.68)
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|
- Income tax relating to items that will not be reclassified to profit or loss
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(0.34)
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0.25
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(0.34)
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0.25
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|
Items that will reclassified to profit or loss -
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|
|
|
|
|
- Exchange differences in translating the financial statements of foreign operations
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-
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-
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(0.09)
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(0.14)
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|
- Income tax relating to items that will be reclassified to profit or loss
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-
|
-
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-
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-
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|
Other comprehensive income/(loss)
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0.63
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(0.43)
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0.54
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(0.57)
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Total comprehensive income/(loss) for the year
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(50.58)
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61.79
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(47.62)
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63.54
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- Owners of the parents
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NA
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NA
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(47.62)
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63.54
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- Non-controlling interests
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NA
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NA
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NA
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NA
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Consolidated figure includes standalone figure and figure of Global Automotive & Appliances Pte. Ltd. (GAAL), a wholly owned subsidiary company and step down subsidiary company, Thai Automotive & Appliances Ltd. (TAAL).
OPERATIONS - Standalone
Your Company completed year 2021-22 on a moderate growth on revenue terms, however suffered loss of Rs. 76.72 Crores at PBT level. The net revenue from operations grew by 22.2% to Rs. 3339 Crores. The profit before depreciation, finance cost and tax as compared to last year reduced by
70.1% to Rs. 68.19 Crores. The reduction in margin is largely on account of hike in material cost, scheme cost, employee costs, overheads and achieving lower number as compared to plan due to Covid-19 etc.
OPERATIONS - Consolidated
Net revenue from operations on consolidated basis increased by 21.9% to Rs. 3415.38 Crores. Profit before depreciation, finance cost and tax on consolidated basis as compared to last year dropped by 68.3% to Rs. 73.55 Crores.
DIVIDEND
Your Directors have decided not to recommend any dividend for the financial year under review to conserve resources for working capital, capital expenditure projects, acquisition etc.
TRANSFER TO RESERVE
The company does not propose to transfer any amount to Reserve.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required under Listing Obligations and Disclosure Requirements Regulations (LODR Regulations), 2015, the Management Discussion and Analysis Report is enclosed as a part of this report.
CHANGE IN THE NATURE OF BUSINESS OF THE COMPANY
During the year under review, there is no change in the nature of the business operations of the Company.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
Your Company has always taken adequate steps to adhere to all the stipulations laid down in LODR Regulations, 2015. A report on Corporate Governance is included as a part of this Annual Report. Certificate from the Statutory Auditors of the company M/s. Deloitte Haskins & Sells, Chartered Accountants confirming the compliance with the conditions of Corporate Governance as stipulated under Listing Obligations & Disclosure Requirements, Regulations, 2015 (LODR) is included as a part of this report.
LISTING WITH STOCK EXCHANGES
The Company confirms that it has paid the Annual Listing Fee for the year 2022-23 to NSE, BSE & CSE where the Company's Shares are listed. The company applied for delisting from CSE which is pending before them.
DEMATERIALISATION OF SHARES
98.27% of the company's paid up Equity Share Capital is in dematerialized form as on 31 March, 2022 and balance 1.73% is in physical form. The Company's Registrars is M/s. C.B. Management Services Pvt. Ltd., having their registered office at P-22, Bondel Road, Kolkata- 700 019. The entire shareholding of the promoters' and promoters' group are in dematerialized form.
NUMBER OF BOARD MEETINGS HELD
The Board of Directors duly met six times during the financial year from 01 April 2021 to 31 March 2022. The dates on which the meetings were held are as follows :
14 June 2021, 7 August 2021, 30 October 2021, 31 December
2021, 1 February 2022 and 29 March 2022.
DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)
Mr. Rajshankar Ray (DIN 03498696) and Mr. Amar Singh Negi (DIN 08941850) were appointed on the Board as Managing Director and CEO of Appliances Division and Executive Director - Service Business Head respectively of the Company for a period of 5 years with effect from 30 October 2020.
Mr. Ashok Bhandari (DIN 00012210) an Independent Director of the Company was re-appointed for second term of five consecutive years with effect from 30 January 2021 and the same was approved by the shareholders at the 45 AGM of the Company held on 6 August 2021.
Mr. Desh Raj Dogra (DIN 00226775) reappointed as Independent Director for a further period of five years and Mr. Biswadip Gupta (DIN 00048258) reappointed as Independent Director for a further period of four years, passed by shareholders of the Company through Postal Ballot dated 25 March 2022.
Mr. Harsh Vardhan Sachdev (DIN 06385288) appointed as Managing Director & CEO of Engineering Division of the Company for a period of three years, passed by shareholders of the Company through Postal Ballot dated 25 March
2022.
Mr. Prabir Chatterjee (DIN 02662511) reappointed as Wholetime Director and CFO of the Company for a further period of two years, passed by shareholders of the Company through Postal Ballot dated 25 March 2022.
Mr. Sudip Banerjee (DIN 05245757) retires by rotation and being eligible offers himself for reappointment.
Mr. Amar Singh Negi (DIN 08941850) retires by rotation and being eligible offers himself for reappointment.
The three years term as an Independent Director of Mr. Chacko Joseph (DIN 07528693) will expire on 1 November 2022. Based on recommendation of Nomination and Remuneration Committee, it is proposed to re-appoint him for second term of five consecutive years with effect from 2 November 2022.
Mr. Bijon Bhushan Nag (DIN 00756995), Chairman of the Company was re-appointed for a further period of two years w.e.f 1 June, 2020 and the same was approved by the shareholders at the 44 AGM of the Company held on 4 September, 2020. The existing term of Mr. Nag will expire on 31 May, 2022. It is proposed to re-appoint him for a term of two years and the concerned resolutions for approval of his appointment are proposed for approval of the members. During the year under review, Mr. Partha Sen ceased to be Director with effect from 31 December, 2021 due to resignation. The Board took on record its deep sense of appreciation rendered by him during the tenure of his directorship.
Brief particulars and expertise of all the directors seeking appointment/re-appointment together with their other Directorship and Committee membership have been given in the annexure to the notice of the Annual General Meeting.
During the year under review, there is no other change in KMP of the Company.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company hereby state and confirm that:
a) in the preparation of the annual accounts for the year ended 31 March 2022, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b) 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 of the company for the same period;
c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls in the company that are adequate and were operating effectively;
f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively.
DECLARATION BY INDEPENDENT DIRECTORS
All the Independent Directors have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 along with Rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. In the opinion of Board there has been no change in the circumstances affecting their status as independent directors of the Company. The Independent Directors have also confirmed the compliance pertaining to their enrolment with the databank of the independent directors maintained by The Institute of Corporate Affairs in terms of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014. The declaration was placed and noted by the Board in its meeting held on 28 May 2022.
REMUNERATION POLICY
A Nomination and Remuneration Policy has been formulated pursuant to the provisions of Section 178 and other applicable provisions of the Companies Act, 2013 and rules there to and Regulation 19 of SEBI (LODR) Regulation 2015 stating therein the Company's policy on Directors/ Key Managerial Personnel/other employees appointment and remuneration by the Nomination and Remuneration Committee and approved by the Board of Directors. The said policy may be referred to on company's website at www.iftindustries.com/Legal/Policies. As a part of the policy, the Company strives to ensure that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors / KMPs of the quality required to run the company successfully; Relationship between remuneration and performance is clear and meets appropriate performance benchmarks.
ANNUAL EVALUATION OF BOARD'S PERFORMANCE
The Board of Directors has carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act and SEBI Listing Regulations.
The performance of the board was evaluated by the Board after seeking inputs from all the directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.
The performance of the committees was evaluated by the Board after seeking inputs from the committee members on the basis of criteria such as the composition of committees, effectiveness of committee meetings, etc.
In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and Chairman of the Company was evaluated, taking into account the views of executive directors and non-executive directors.
At the board meeting that followed the meeting of the independent directors and meeting of Nomination and Remuneration Committee, the performance of the Board, its Committees, and individual directors was also discussed. Performance evaluation of independent directors was done by the entire Board, excluding the independent director being evaluated.
AUDIT COMMITTEE
The Board has constituted an Audit Committee, the details pertaining to the composition of the audit committee are included in the report on Corporate Governance. There has been no instance during the year where recommendations of the Audit Committee were not accepted by the board.
AUDITORS' REPORT
The notes on Financial statements referred to in the Auditor's Report are self-explanatory and do not call for any further explanation. During the year under review, the Auditors did not report any matter under Section 143(12) of the Act, therefore no detail is required to be disclosed under Section 134(3)(ca) of the Act.
STATUTORY AUDITORS
At 43 Annual General Meeting held on 26 July 2019 the shareholders of the company reappointed M/s. Deloitte Haskins & Sells (Firm Registration No.: 302009E), Chartered Accountants as the Auditors of the Company for the second term of five consecutive years from the conclusion of 43rd Annual General Meeting to the conclusion of 48th Annual General Meeting. The requirement to place the matter relating to reappointment of auditors for ratification by Members at every Annual General Meeting has been done away by the Companies (Amendment) Act, 2017 with effect from 7 May 2018. Accordingly, no resolution is being proposed for ratification of reappointment of statutory auditors at the ensuing AGM and a note in respect of same has been included in the Notice for this AGM.
COST AUDITORS
Your Board has appointed M/s. MANI & Co., Cost Accountants as Cost Auditors of the Company for conducting cost audit for the financial year 2022-23. Accordingly, a resolution seeking approval of the members for ratifying the remuneration payable to Cost Auditors for financial year
2022-23 is provided in the Notice to the ensuing Annual General Meeting.
COST RECORDS
The Cost accounts and records as required to be maintained under Section 148(1) of the Act are duly made and maintained by the Company.
SECRETARIAL AUDIT
The provision of Section 204 read with Section 134(3) of the Companies Act, 2013 mandates Secretarial Audit of the Company to be done from the financial year commencing on or after 1 April 2014 by a Company Secretary in practice. The board in its meeting held on 29 March 2022 appointed Mr. Sankar Kumar Patanaik, Practising Company Secretary (Certificate of Practice no 7177) as the Secretarial Auditor for the financial year ended 31 March 2022.
According to the provision of section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit Report submitted by Company Secretary in Practice is enclosed as a part of this report as Annexure-A. The observations of the Secretarial Auditor are self explanatory in nature and does not call for any further explanation.
SECRETARIAL STANDARDS
The Company has in place proper system to ensure compliance with the provisions of the applicable Secretarial Standards issued by The Institute of Company Secretaries of India and such systems are adequate and operating effectively.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Information required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is enclosed as a part of this report as Annexure-B.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
In terms of section 135 and Schedule VII of the Companies Act, 2013, the Board of Directors of your Company constituted a CSR Committee. The Committee comprises independent director, non-executive director and executive director. CSR Committee of the Board has developed a CSR Policy which has been uploaded on the website of the Company at www.iftindustries.com. Your company has identified the activities covering mainly relating to
(a) Promoting education, (b) Promoting Health Care and (c) skill development programme in line with the CSR policy of the Company. The company made an expenditure of Rs. 153.83 lacs against the budgeted amount of Rs. 153.49 lacs. The complete disclosure on CSR activities in terms of Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is enclosed as a part at this report as Annexure-C.
VIGIL MECHANISM
In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.iftindustries.com.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts/ arrangements/ transactions entered by the company during the financial year with related parties were in ordinary course of business and on an arm's length basis. During the year, the company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transaction on which is required to be reported in Form No. AOC-2 in terms of Section 134(3)(h) read with Section 188 of the Act. The policy on materiality of related party transaction and on dealing with related party transaction as approved by the board may accessed on company's website at www.iftindustries.com. There were no materially significant related party transactions which could have potential conflict with interest of the Company at large. Your directors draw attention of members to note 37 to the Financial Statements which set out related party disclosures. As required under the Companies Act, 2013, the prescribed Form AOC-2 is appended as Annexure-D to the Board's report.
ANNUAL RETURN
In compliance with Section 92(3) and Section 134(3)(a) of the Act read with Companies (Management and Administration) Amendment Rules, 2020, the Annual Return for FY 2021-22 in the prescribed format has been placed at the Company's website at www.iftindustries.com.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS
The particulars of Loans, Guarantees and Investments
covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES
The information required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed as part of this report as Annexure-E.
The number of permanent employees on the role of the company as on 31 March 2022 is 2640.
The statement containing particulars of employees employed throughout the year and in receipt of remuneration of Rs. 1.02 crore or more per annum and employees employed for part of the year and in receipt of remuneration of Rs. 8.5 lacs or more per month, as required under Section 197(12) of the Companies Act, 2013, read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forming part of this report and is available on the website of the Company, at www.iftindustries.com.
In terms of Section 136 of the Act, the said annexure is open for inspection and any member interested in obtaining a copy of the same may write to the Company to email Id investors@iftglobal.com.
BUSINESS RESPONSIBILITY REPORT
In conformance to the requirements of the clause (f) of sub-regulation (2) of regulation 34 of Securities and Exchange Board of India (SEBI) Listing Regulations, the Business Responsibility Report for Financial Year 2021-2022 is given in as Annexure-F which forms part of this Report.
DIVIDEND DISTRIBUTION POLICY
The Board of Directors of IFB Industries Limited at its meeting held on May 29, 2018 has adopted this Dividend Distribution Policy (the "Policy") as required by Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations") is available at our website www.iftindustries.com.
DEPOSITS
During the year under review, your company has not accepted any deposit from the public / members u/s 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits) Rules, 2014 during the year.
SHARE CAPITAL
During the year under review, no new shares were issued by the Company, therefore there was no change in the Issued and Paid-Up Share Capital of the Company. However, pursuant to the Scheme of Amalgamation the Authorized Equity Share Capital of Trishan Metals Private Limited of Rs. 2,400 lacs has been added in the Authorized Equity Share Capital of IFB Industries Limited. The enhanced Authorized Equity Share Capital of IFB Industries Limited stands at Rs. 8,900 lacs, divided into 8,90,00,000 equity shares of Rs. 10 each.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There has been no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concerns status of the Company and its future operations.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
There has been no material changes and commitments have occurred after the closure of the year till the date of this Report, which affect the financial position of the Company.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL ) ACT, 2013
As per the requirement of Sexual Harassment of Women at workplace (Prevention, Prohibition & redressal) Act, 2013, your Company has in place a Policy for Prevention of Sexual Harassment of Women at Work Place and constituted Internal Complaints Committees. No compliant has been raised during the year ended 31 March, 2022.
DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY
The Board of Directors of the Company already formed a Risk Management Committee to frame, implement and monitor the risk management plan for the Company. The Committee is monitoring and reviewing the risk management plan and ensuring its effectiveness.
Risk management is the process of minimizing or
mitigating the risk. It starts with the identification and evaluation of risk followed by optimal use of resources to monitor and minimize the same. The company is exposed to several risks. They can be categorized as operational risk and strategic risk. The company has taken several mitigating actions, applied many strategies and introduced control and reporting systems to reduce and mitigate those risks.
Appropriate structures are in place to proactively monitor and manage the inherent risks in businesses with unique/ relatively high risk profiles.
An independent Internal Audit function carries out risk focused audits across all business, enabling identification of areas where risk management processes may need to be strengthened. The Audit committee of the board reviews internal audit findings on risk and provides strategic guidance on internal controls.
FAMILARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
To familiarize the Independent Directors with the strategy, operations and functions of our company, the executive directors/senior managerial employees make presentation to the Independent Directors about the company's strategy, operations, product and service offerings, markets, finance, quality etc. Independent Directors are also visiting factories and branch offices to familarise themselves with the operations of the company and to offer their specialized knowledge for improvement of the performance of the company.
Further, at the time of appointment of an Independent director, the company issues a formal letter of appointment outlining his/her role, function, duties and responsibilities as a director. The format of the letter of appointment is available at our website www.iftindustries.com .
MERGER AND ACQUISITION
During the year, Hon'ble National Company Law Tribunal (NCLT), Kolkata Bench vide its order dated January 27, 2022 has approved the scheme of Amalgamation of wholly owned subsidiary Trishan Metals Private Limited (TMPL) with IFB Industries Limited (IFBIL). IFB Industries Ltd and Trishan Metals Pvt. Ltd. have filed necessary Forms with Registrar of Companies (ROC), which have been approved by ROC and thus Trishan Metals Private Limited amalgamated with IFBIL.
to 171.86 million THB achieved during 2020-21. During the year the company earned PBT of 0.13 million THB as compared to PBT of 2.39 million THB achieved during 2020-21.
Consolidated financial statements of the company and its subsidiary Global Automotive & Appliances Pte Ltd have been prepared in accordance with Section 129(3) of the Companies Act, 2013. Further, the report on the performance and financial position of the subsidiary companies in the prescribed form AOC-1 is given in Annexure-G.
In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the Consolidated financial statements and related information of the company and financial statement of the subsidiary companies will be available on our website at www.iftindustries.com. These documents will also be available for inspection during business hours at the corporate office of company.
ACKNOWLEDGEMENT :
Directors take this opportunity to express their thanks to various departments of the Central and State Government, Bankers, Customers and Shareholders for their continued support.
The Directors wish to place on record their appreciation for the dedicated efforts put in by the Employees of the Company at all level.
For and on behalf of the Board of Directors Bikramjit Nag (DIN: 00827155) Joint Executive Chairman & Managing Director
Prabir Chatterjee
Place : Goa / Kolkata (DIN: 02662511)
Date : 28 May 2022 Director & CFO
INSOLVENCY AND BANKRUPTCY CODE
No applicatioin has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year is not applicable.
VALUATION
The requirement to disclose the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from banks on financial institutions along with the reason thereof, is not applicable.
SUBSIDIARY COMPANIES
IFB Industries Limited, has one wholly owned subsidiary company Global Automotive & Appliances Pte Ltd. (GAAL) and one step down subsidiary Thai Automotive & Appliances Ltd. (TAAL).
Wholly Owned Subsidiary Global Automotive & Appliances Pte Ltd. ( GAAL) and step down subsidiary Thai Automotive & Appliances Ltd. ( TAAL)
IFB Industries Ltd. acquired 100 % equity shares of GAAL during July 2017. GAAL holds 100% equity holding in TAAL. GAAL acts as a special purpose vehicle for further investment in TAAL. GAAL is also engaged in trading of Electronics Parts and semiconductors and other commodities. TAAL is engaged in the business of Fine Blanking and Conventional Blanking and its acquisition helps IFB to consolidate its position in similar type of business in Thailand.
GAAL
During the year under review, GAAL has achieved revenue of US$ 4.90 Million and made a PBT of 8.05%. GAAL estimates that market would be subdued till end of Q2 and slowly would begin to rise subsequently.
TAAL
During the year under review, TAAL has achieved turnover of 181.86 million THB, which is a 5.82% growth as compared
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