DIRECTORS' REPORT TO THE MEMBERS:- Your directors are delighted to present Sixty Fourth Annual Report of your Company along with the audited statement of accounts for the year ended 31st March 2015 PRODUCTION During the year under consideration, the Company produced 23,00,923/- bicycles as against 25,87,585 bicycles in the previous year. SALES Sales during the year amounted to Rs. 594.59 Crore including the sales to foreign countries as against Rs. 650.11 Crore including the sales to foreign countries in the previous year. TRANSFER TO RESERVES The Company proposes to transfer Rs. NIL to the General Reserve for the year 2014-15 as against Rs. NIL to General Reserve in the previous year. EXPORTS During the period under consideration your Company exported bicycles and bicycle components to several countries thereby earning valuable foreign exchange of Rs. 2791.09 Lacs. The company continued its efforts to increase sales in export market due to which it achieved better export earning than last year, despite stiff competition. SHARE CAPITAL The paid up Equity Share Capital as at 31st March 2015 stood at Rs. 3,25,19,190/- i.e. 23,51,919 Equity Shares of Rs. 10 Each. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity. As on 31st March 2015, none of the Directors of the Company hold instruments convertible into equity shares of the Company. DIVIDEND During the year under review, your company has not declared any Dividend for the financial year ended 31st March 2015 due to losses. CONSOLIDATED ACCOUNTS The Consolidated Financial Statements of the Company are prepared in accordance with relevant Accounting Standards viz. AS-21, AS-23 and AS-27 issued by the Institute of Chartered Accountants of India and forming part of this Annual Report. The three wholly owned subsidiary companies of the Company are yet to commence their business. PERFORMANCE OF THE UNITS Performance of Sahibabad unit was good during last financial year. New range of high end ULTIMATE series introduced last year got encouraging response from the market; thus a lot of new models were further added to it. Unit is in the process of launching alloy bicycles vide a new series called MAGNUM in the Ultra Premium segment. MANAGEMENT DISCUSSION AND ANALYSIS REPORT Management Discussion and Analysis Report for the year under review, as stipulated under clause 49 of the Listing Agreement with the Stock Exchange, is presented in a separate section forming part of the Annual Report. DIRECTORS Mr. Hari Krishan Ahuja (DIN: 00315876) is retiring by rotation at this Annual General Meeting and, being eligible, offers himself for reappointment. Further, pursuant to clause 49 (IV) (E) (iv) of the Listing Agreement, the shareholders may take note that Mr. Hari Krishan Ahuja, Non Executive Director of the Company holds Nil equity shares in the Company as on the date of this report. In compliance with the requirement of Clause 49 of the Listing Agreement for appointment of Woman Director in the Company, the Board of Directors of the Company appointed Ms. Veena Buber (DIN: 07163537) as Additional Director of the Company on 26th March 2015 through Resolution by circulation whose appointment was ratified in the Board Meeting held on 29th April, 2015. She holds the office of Additional Director up to the date of ensuing Annual General Meeting of the Company and is eligible for appointment as Independent Woman Director of the Company for the tenure of 5 years effective from 30th September 2015. KEY MANAGERIAL PERSONNEL In the capacity of Key Managerial Personnel, the company has 1. Mr. Ishwar Das Chugh, Whole Time Director 2. Mr. Chander Mohan Dhall as Manager / Chief Executive Officer & Chief Financial Officer (In the capacity of Chief Financial Officer, he takes care of Malanpur Unit of the Company only) 3. Mr. Jaspreet Singh, Company Secretary PERFORMANCE OF BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, a healthy discussion was held among directors after taking into consideration of the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance. The performance evaluation of the Independent Directors was completed. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process. NUMBER OF MEETINGS OF THE BOARD There were total 10 number of Board Meetings held during the financial year 2014-15. Further details are provided in the Corporate Governance Report. DEPOSITS (INCLUDING LOANS FROM MEMBERS) Unclaimed deposits aggregating to Rs. 21,000 pending for more than 7 years, have been credited to Investors Education and Protection Fund of Government of India. The Company is in process of repaying all its deposit holders and is not further accepting deposits from the public or members. PARTICULARS OF LOANS, GUARANTEES OR 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 Statement. WHISTLE BLOWER MECHANISM The Company has a whistle blower policy to report genuine concerns or grievances. The Whistle Blower Policy has been posted on the website of the Company. REMUNERATION AND NOMINATION POLICY The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are explained in the Corporate Governance Report. RELATED PARTY TRANSACTIONS All transactions entered with Related Parties for the year under review were on arm's length basis and in the ordinary course of business and that the provisions of Section 188 of the Companies Act, 2013 are not attracted. Thus disclosure in form AOC-2 is not required. Further, there are no material related party transactions during the year under review with the Promoters, Directors or Key Managerial Personnel. The Company has developed a Related Party Transactions framework through Standard Operating Procedures for the purpose of identification and monitoring of such transactions. All Related Party Transactions are placed before the Audit Committee on quarterly basis for confirmation. Omnibus approval was obtained on a yearly basis for transactions which are repetitive in nature subject to further approval in case actual transactions are found to be exceeding the omnibus approval. A statement giving details of all Related Party Transactions are placed before the Audit Committee for review on quarterly basis. A Policy on Material Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company. None of the Directors has any pecuniary relationship or transactions vis-a-vis the Company. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant and material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operations. CORPORATE GOVERNANCE The Company complies with the clauses of Listing Agreement entered into with the National Stock Exchange of India Limited, BSE Limited and Delhi Stock Exchange Limited where the Company's shares are listed. It may be noted that the Delhi Stock Exchange has been de-recognized by SEBI. Further, in terms of the provisions of Clause 49 of the Listing Agreement, your Company has complied with the requirements of Corporate Governance and a Report on Corporate Governance together with certificate from the Company's Auditors confirming compliance, is set out in a statement, which forms part of this Annual Report. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is annexed to this Report and forms an integral part of this Report. STATUTORY AUDITORS AND AUDITORS' REPORT M/s Mehra Khanna & Co., Chartered Accountants, (Firm Registration Number: 01141N) were re-appointed in the 63rd Annual General Meeting for a period of 3 years upto the conclusion of 66th Annual General Meeting. Their appointment is proposed to be ratified at the forthcoming Annual General Meeting. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s Mehra Khanna & Co. that their appointment, if made, would be in conformity with the limits specified in the said Section. The qualifications or remarks in the Auditor's Report read with Notes to financial statements are self explanatory. SECRETARIAL AUDITOR AND SECRETARIAL AUDITOR'S REPORT Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made thereunder, the Company has appointed M/s Mukesh Arora & Company, a firm of Company Secretaries in Practice (Certificate of Practice Number : 4405) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure - B and forms an integral part of this Report. The secretarial audit qualifications for the year under review requiring clarification by the Board of Directors are replied by the Board of Directors and form part of the Secretarial Audit Report. COST AUDIT As per the requirement of Central Government and pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company is not required to carry out audit of cost records relating to Bicycle Industry. Accordingly, your Company did not appoint Cost Auditor in this financial year. However, Cost Audit Report for the financial year 201314 was duly filed with the Ministry of Corporate Affairs. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY Your Company has an effective internal control and risk mitigation system, which are constantly assessed and strengthened with new/revised standard operating procedures. The Company's internal control system is commensurate with its size, scale and complexities of its operations. The Company has appointed Mr. Harish Kumar Arora as Internal Auditor of the Sonepat Unit of the Company, Mr. Gopal D. Girdharwal, as Internal Auditor of the Sahibabad Unit of the Company and Mr. Chander Mohan Dhall, as Internal Auditor of the Malanpur Unit of the Company. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal control systems. CORPORATE SOCIAL RESPONSIBILITY (CSR) Requirements relating to Corporate Social Responsibilities as envisaged in Schedule VII of the Companies Act, 2013 and Companies (Corporate Social Responsibility Policy) Rules, 2014 are not applicable on our Company. HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATION Your Company strives to provide the best working environment with ample opportunities to grow and explore. Your Company maintains a work environment that is free from physical, verbal and sexual harassment. Every initiative and policy of the Company takes care of welfare of all its employees. The human resource development function of the Company is guided by a strong set of values and policies. The details of initiatives taken by the Company for the development of human resource are given in Management Discussion and Analysis Report. The Company maintained healthy, cordial and harmonious industrial relations at all levels throughout the year. STATUTORY INFORMATION The information required under Section 197(12) of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and forming part of the Directors' Report for the year ended 31st March 2015 is given in a separate Annexure to this Report. The above Annexure is not being sent along with this Report to the Members of the Company in line with the provision of Section 136 of the Companies Act. 2013. Members who are interested in obtaining these particulars may write to the Company Secretary at the Registered Office of the Company. The aforesaid Annexure is also available for inspection by Members at the Registered Office of the Company, 21 days before the 64th Annual General Meeting and upto the date of the ensuing Annual General Meeting during the business hours on working days. None of the employees listed in the said Annexure is a relative of any Director of the Company. Apart from Mr. Vikram Kapur, President of Sonepat Unit, Mr. Rajiv Kapur, Joint President of Sonepat Unit, Mr. Gautam Kapur, Joint President of Sahibabad Unit, Mr. Girish Kapur, Joint President of Sahibabad Unit and Mr. Sanjay Kapur, Joint President of Malanpur Unit, none of the employees holds (by himself or along with his spouse and dependent children) more than two percent of the equity shares of the Company. The Business Responsibility Reporting as required by Clause 55 of the Listing Agreement with the Stock Exchanges is not applicable to your Company for the financial year ending 31st March 2015. PERSONNEL AND PARTICULARS OF EMPLOYEES The industrial relations with the workers and staff of the Company remained cordial throughout the year. There was unity of objective among all levels of employees, continuously striving for improvement in work practices and productivity. Training and development of employees continue to be an area of prime importance. Only in Malanpur Unit of the Company there were some concerns due to closing down of the Malanpur Unit in the month of October 2014. Particulars of the employees as required under section 197 (12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personeen) Rules, 2014 and forming part of the Directors' Report for the year ended 31st March 2015 is given in a separate Annexure to the Report. LISTING OF COMPANY'S EQUITY SHARE Your Company's shares continue to be listed on BSE Limited, National Stock Exchange of India Limited and Delhi Stock Exchange Limited. Since Delhi Stock Exchange has been de-recognized by the SEBI, the annual listing Fee for the year 2014-2015 has been paid to BSE Limited and National Stock Exchange of India Limited. SUBSIDIARY COMPANIES / ASSOCIATE COMPANIES Statement of Accounts of the subsidiaries together with statement in Form AOC-1 under section 129(3) of the Companies Act, 2013 read with Rule 5 of Companies (Accounts) Rules, 2014 are annexed herewith. There are no associate companies as per definition given in Section 2(6) of the Companies Act, 2015. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The information under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 for the year ended 31st March 2015 is given here below : CONSERVATION OF ENERGY SONEPAT UNIT The following measures were taken for Conservation of energy:- a) New OLTC type transformer of 1600 KVA rating has been installed in place of two old transformer of 1250 KVA and 1000 KVA to reduce losses. b) Installed 1500KVA fuel efficient Diesel engine in place of old 500 KVA slow speed diesel engine. c) Installation of Natural Wind Air Exhaust to replace exhaust fan in Granodising area. d) Roots Blower of 5 HP installed in place of 25 HP capacity for energy saving. e) All Sodium Vapor fittings of 250 watt and 400 watt replaced with LED street light of 40 Watt for energy saving. f) Transparent sheet installed in plant for natural light. g) New water wall changed of 4 ton boiler to reduce consumption of fuel and increase efficiency. h) Two new compressor VFD type installed in place of old compressors for energy saving. i) VFD drives installed in Phosphating plant for energy saving. j) Modified Furnace design for better heating and longer life of Cruisibel. SAHIBABAD UNIT The following measures were taken for Conservation of energy:- A hot water generator was installed to replace two boilers to save energy. - An energy efficient oven being installed for tail end white paint baking to replace the old process of baking by IR bulbs. TECHNOLOGY ABSORPTION SAHIBABAD UNIT - Slat conveyors were introduced to increase the productivity of standard Frames in Assembly Section. - Higher capacity Rectifiers were installed at Debrassing stage to increase productivity of Frames in Tubular Section. FOREIGN EXCHANGE EARNING AND OUTGO Total foreign exchange earned: Rs. 2791.09 lacs Total foreign exchange used: Rs. 2835.35 lacs DIRECTORS' RESPONSIBILITY STATEMENT To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013 that: I. In the preparation of the Annual Accounts for the year ended 31st March 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; II. The directors had 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 31st March 2015 and of the loss of the Company for that period; III. The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, to the best of the knowledge and ability of the Directors. IV. The Annual Accounts have been prepared on a going concern basis. V. 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 VI. The Directors had devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. REPORT ON THE PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES The Company has 3 (three) subsidiary companies viz. Atlas Cycles Sonepat Limited, Atlas Cycles (Sahibabad) Limited and Atlas Cycles (Malanpur) Limited. These companies are yet to commence its business and accordingly there is no performance to reflect during the year. Apart from these, the Company do not have any associate companies and joint venture companies. ACKNOWLEDGEMENT The Board of Directors wishes to place on record its appreciation for the commitment, dedication and hard work done by the employees of the Company and the cooperation extended by Banks, Government authorities, customers and shareholders of the Company and looks forward to a continued mutual support and co-operation. HARI KRISHAN AHUJA (DIN: 00315876) Non-Executive Director 147, Jor Bagh, New Delhi - 110003 ISHWAR DAS CHUGH (DIN: 00073257) Whole Time Director I-73, Narain Vihar, New Delhi - 110028 DIRECTORS Date : 7th September, 2015 Place: Delhi |