DIRECTORS' REPORT To The members of PIX Transmissions Ltd, The directors are pleased to present the THIRTY THIRD ANNUAL REPORT and the Audited Statement of Accounts for the year ended 31st March 2015, together with notice of Annual General Meeting. 1. PIX Middle East FZC, UAE. PIX Middle East FZC incorporated to carry on business of PIX Products in the market of Middle East Countries. 2. PIX Transmissions Europe Limited, UK; PIX Transmissions Europe Limited incorporated to carry on business of PIX Products and other products in the market of European Countries. 1.PIX Middle East Trading LLC, UAE; PIX Middle East Trading LLC, UAE is subsidiary of PIX Middle East FZC established to carry on business of PIX Products in the market of Middle East Countries. 2.PIX Germany GmbH, Germany; PIX Germany GmbH, Germany is subsidiary of PIX Transmissions Europe Limited incorporated to carry on business of PIX Products and other products in the market of European Countries. As required under the listing Agreement entered into with stock exchange, consolidated financial statement of the company and all its subsidiaries is attached. The c o nsolidated financial statement has been prepared in accordance with Accounting Standard (AS)-21 on Consolidated Financial Statements read with AS-27 on Financial Reporting of Interest in Joint Ventures, the audited consolidated financial statement is provided in the Annual Report. A statement containing brief financial details of the company's subsidiaries for the financial year ended 31st March 2015 included in the Annual Report and shown as ANNEXURE 1. The annual account of these subsidiaries will be available for inspection of members at the registered office of the company. Dividend on Equity Share: The Board of Directors at their meeting held on 29th of May, 2015 has recommended final dividend of 1.00 per equity share of Face Value of * 10 each, for the financial year ended 31st March, 2015, subject to approval of the Shareholders. Directors' Responsibility Statement Pursuant to section 134(5) of the Companies Act, 2013, The Board of Directors report that: i) In the preparation of the annual accounts for the year March, 31, 2015, the applicable Accounting Standards read with requirements set out under Schedule III of the Act, have been followed and there are no material departures from the same; ii) Directors 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 as at March, 31 2015 and of the Profit or Loss Account for the year ended on that date;. iii) The Directors 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; iv) The Directors have prepared the Annual Accounts on a going concern basis; v) The Directors have laid down internal financial control to be followed by the company and that such internal financial controls are adequate and are operating effectively; and vi) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants and the reviews performed by management and the relevant board committees, including the audit committee the board is of the opinion that the company's internal financial controls were adequate and effective during the financial year 2014-15. Public Deposits The Company has not invited and accepted deposits from the public during the financial year ended 31st March 2015. Insurance The assets of the Company are adequately insured against the risk of fire and other risks. Particulars of Employees Under the provision of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5 (3) of the Companies (Appointment and Remuneration of Managerial Personnel), 2014 read with Companies (Particulars of Employees) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report as shown as ANNEXURE 2. Directors and Key Managerial Personnel In pursuance to the provisions of Act and Articles of Association of the company Mr. Amarpal Sethi, Mr. Rishipal Sethi and Mr. Karanpal Sethi retire by rotation and being eligible offer themselves for re-appointment. During the year under review Mr. Mohammed Adil Ansari, Mr. Nigel Savio Lobo, Mr. Prakash Chand Khasgiwala and Dr. Manoj Mohan Sajnani were appointed as independent directors of the company. During the year Mr. Aqueel Ahmed Mulla was appointed as an Additional Director effective from 1st March, 2015 to hold office upto the date of next Annual General Meeting of the company. Being eligible he offers himself for appointment as an independent Director. During the year two independent directors namely Mr. Jose Jacob and Mr. Om Prakash Arora have resigned from the Board due to ill health and pre-occupation respectively. The Board hereby places on record its sincerest thanks and gratitude for the invaluable contribution made by Mr. Jose Jacob and Mr. Om Prakash Arora towards growth and development of the company during their tenure as directors. The company has received declaration from all the independent directors confirming that they meet the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchange. The company has devised a policy for the performance evaluation of independent directors, Board committees and other individual directors which include criteria for performance evaluation of nonexecutive directors and executive directors. The manner in which the evaluation is carried out has been explained in the Corporate Governance Report. Meeting of the Board During the year under review ten Board Meetings were held. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013. For further details please refer to Corporate Governance Report attached to this Annual Report. Audit Committee The Audit committee comprises Independent Directors namely Mr. Haresh Eidnani ( Chairman), Mr. Amarpal Sethi (Executive Director), Mr. Mohammed Adil Ansari and Mr. Pradeep Havnur as other members. All the recommendation made by the Audit Committee was accepted by the Board. Vigil Mechanism The vigil mechanism of the company, which also incorporates a whistle blower policy in terms of the Listing Agreement, includes an ethics and Compliance Task Force comprising of senior executives of the company. It deals with instance of fraud and mismanagement, if any in the company. 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 responsibility. The whistle blower Policy ensures that strict confidentiality is maintained while dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern. Nomination and Remuneration Committee: The Nomination and Remuneration Committee comprises of the Directors namely, Mr. Pradeep Havnur (Chairman), and Mr. Aqueel Ahmed Mulla and Mr. Haresh Eidnani as other members of the committee. This committee recommends and reviews the appointment and remuneration of Directors. It has adopted a policy which deals with the appointment and remuneration of directors and key managerial persons. The adopted policy decides about the manner of selection of executive directors, key managerial persons, and independent directors. The policy also decides about the criteria to be followed for recommending the remuneration of directors and key managerial persons. Board Evaluation The Board of Director have carried out an annual evaluation of its own performance, Board Committees and individual directors pursuant to the provision of Act and the Corporate Governance requirement as prescribed by Securities and Exchange Board of India(SEBI) under clause 49 of listing Agreement. The performance of Board was evaluated by the board after seeking inputs from all directors on the basis of criteria such as Board Composition & Structure, Effectiveness of Board Proces, Information, and functioning, etc. In a separate meeting of Independent directors' performance of Non-Independent Directors, performance of the Board as whole and performance of Chairman was evaluated, taking into account the views of executive directors and non-executive directors. Loans, Guarantees and Investments Details 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 Related Party Transaction All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large. The particulars of such related party transactions are annexed herewith as ANNEXURE - 3 Corporate Social Responsibility (CSR) In terms of section 135 and Schedule VII of the Companies Act, 2013, the Board of Directors of your Company has constituted a CSR Committee consist of Mr. Rishipal Sethi (Chairman) and Mr. Joe Paul (Whole-time Director) and Mr. Aqueel A Mulla as other members of the committee. The CSR Committee of the Board has developed a CSR Policy under education activity which is enclosed as part of this report ANNEXURE - 4. Additionally, the CSR Policy has been uploaded on the website of the Company at www.pixtrans.com Extract of Annual Return As provided under Section 92(3) of the act, the extract of annual return is given in the ANNEXURE 5 in the prescribed Form MGT-9, which forms part of this report. Auditor M/s S. C. Bandi & Co. Chartered Accountants, Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. Members are requested to re-appoint the statutory auditors. Auditors' Report The notes forming part of the accounts are self-explanatory and do not call for any further clarifications. Cost Auditor As per the requirements of Central Government your Directors have appointed M/s. Manisha & Associates, Cost Accountants, as cost auditors of the Company to carry out the audit of cost accounting records for the financial year 2014-15. Secretarial Auditor Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed M/s S.D Bargir & Co, a firm of company Secretaries in practice to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report submitted by the Secretarial Auditors is enclosed herewith as a part of this report and shown as ANNEXURE - 6 Risk Management The Board of Directors of the company has formed a Risk Management Committee to frame, implement and monitor the Risk Management Plan for the company. The committee is responsible for reviewing the Risk Management Plan and ensuring its effectiveness. The Audit Committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating action on a continuing basis. The development and implementation of Risk Management Policy has been covered in the Management Discussions and Analysis, which forms part of this report. Remuneration Ratio of the of Directors/ Key Managerial Personnel (KMP)/ Employees The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Companies (Particulars of Employees) Rules, 1975, in respect of employees of the Company and Directors is furnished hereunder: CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION Conservation of Energy: Company is always looking towards every step in the direction of conservation of energy. Supply of better quality water and reduction of consumption of water, steam, fuel and electricity have improved consumption ratio with respect to per ton of finished product, thereby conserving energy. The Major sources of energy in the company are: 1.0 Fuel /Steam 2.0 Electricity 3.0 Water 1.0 Conservation of Steam 1.1 Fuel change from furnace oil to Biomass briquette by replacing the steam boilers from furnace oil fired Boiler to solid fuel Boiler has reduced the consumption of fuel. 1.2 Automation of the belt curing pots has optimized the steam utilization, controlled on steam wastage which has resulted to saving of steam consumption 1.3 Use of solid fuel adhesive has reduced the consumption of Biomass briquette fuel. 1.4 Waste heat recovery systems have been introduced in pot and press section. The waste heat is utilized for pre-heating of boiler feed water. 1.5 Reuse of condensate has reduced the consumption of fuel. 1.6 Heating of water by using flash steam in process area has reduced the steam consumption. 1.7 Reduction in fuel consumption by use of good quality water for boiler feed & regular cleaning & maintenance of boilers. 1.8 Optimum utilization of steam, control on wastage & leakages of steam and maintaining proper insulation has contributed to saving of steam consumption. 2.0 Conservation of Electricity 2.1 Old reciprocating type air compressors / chilling plants and old process machineries has been replaced by energy efficient screw type air compressors / chilling plants and new automated process machineries which has reduced electricity consumption significantly. 2.2 Optimum utilization of compressed air & chilled water, control on wastage & leakages and maintaining proper insulation has contributed to saving of compressed air & chilled water, which has resulted to saving of electricity. 3.0 Conservation of Water 3.1 By setting up a new sewage treatment plant & new effluent treatment plant, treated water is used for gardening, floor washing, toilets etc which resulted in reduction of fresh water consumption. 3.2 Installation of cooling towers for re-circulation of water used for machines cooling, conserve the ample quantity of fresh water. 3.2 Installation of cooling towers for re-circulation of water used for machines cooling, conserve the ample quantity of fresh water. 3.3 Use of reverse osmosis plant & water softening plant for treating of raw water, helps to reduce feed water consumption in boiler, increases the life of process machineries and provide good quality of drinking water. 3.4 Collection of maximum amount of steam condensate, reduce the feed water consumption in Boilers. 3.5 Company is introducing rain water harvesting systems which will help to retain the rainwater in our area and conserve the water. As a result to above energy conservation measures; Cost of fuel, Electricity and water per ton of goods production has reduced considerably and made consequent impact on the cost of finished goods. The disclosure of particulars with respect to conservation of energy is attached to the Directors' Report. A. Technology absorption Efforts made in technological absorption were carried out by the company. After total introduction of new products the same will be absorbed and maintained for higher productivity and better quality. B. Foreign Exchange Earnings & Outgo Particulars regarding foreign exchange earnings and outgo are presented in Schedule 44 & 45 of the Audited Account. The company has retained its status as net foreign exchange earner. The particulars of conservation of energy, technology absorption and foreign exchange and outgo as required under the Companies (Accounts) Rules, 2014 is given in the annexure to this report and shown as ANNEXURE 7 Environmental Policy The Company is committed to follow systematic approach to achieve continual improvement in environmental performance by strengthening the greening of supply chain, occupational health & safety while complying with all applicable legal, safety legislation and other requirements. Design & Development /testing Laboratory The strength of the company lies in the introduction of new products through robust design, development, testing and introduction. The design and development activity of the company is carried out using the best resources and facility The company has at its disposal a rich talent pool of technical manpower from Rubber Technology, Mechanical Engineering, Computer engineering and Material Procurement who design and develop the product and process. The Company has State of the Art facilities capable for validating and verifying the entire product range of Belts and Allied Products that the organization has in its range and proposes to innovate. The Company has foot prints in the global market place by setting the pace for reduced innovation cycle time for turning around a product. All Design and Development outputs are reviewed at regular intervals by the Top Management. Management Discussion and Analysis Report As required under Clause 49 of the Listing Agreements with Stock Exchanges, the Management Discussion and Analysis Report is enclosed as a part of this report. Corporate Governance and Shareholders Information Your Company has taken adequate steps to adhere to all the stipulations laid down in Clause 49 of the Listing Agreement. A report on Corporate Governance is included as a part of this Annual Report. Certificate from the Statutory Auditors of the company M/s. S.C Bandi & Co, Chartered Accountants confirming the compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is included as a part of this report. Sexual Harassment of Women at Workplace; During the year under review, there were no cases reported pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Acknowledgement The Directors wish to place on record their appreciation towards all associates including Customers, Collaborators, Government Agencies, Financial Institutions, Bankers, Suppliers, Shareholders, Employees and others who have reposed their confidence in the Company. For and on behalf of the Board of Directors Karanpal Sethi Director Sonepal Sethi Joint Managing Director Place: Mumbai Date:29.05.2015 |