Board of Directors' Report Dear Members, Your Directors have pleasure in presenting the 31st Annual Report and Audited Financial Statements for the Financial Year ended 31st March, 2016. RESULTS OF OPERATIONS OPERATIONS: During the year under review, the following are the highlights of your Company: • Achieved a turnover during 2015-16 is Rs. 20,642.46 lacs as compared to Rs. 19,646.40 lacs during 2014-15 reflecting an increase of 5.07%. • Profit before tax during 2015-16 is Rs.519.91 lacs against pretax profit during the year 2014-15 of Rs. 185.97 lacs. • Profit after tax during 2015-16 is Rs. 147.83 lacs against post tax profit during the year 2014-15 of Rs. 231.60 lacs. • Pre-tax Cash Profit during 2015-16 is Rs 1,778.51 lacs against pre-tax cash profit during the year 2014-15 of Rs. 1,320.80 lacs. Your company has in place adequate internal financial controls in accordance to the size of the company and with reference to financial statement. The internal financial controls have been regularly reviewed by the auditors of your company and no reportable material weakness in the design or operation was observed. DIVIDEND Your Directors recommend a dividend of 10% (i.e., Rs. 1 per equity shares of Rs. 10 each) of the financial year 2015-16 amounting to Rs.61,36,800/-. The dividend payout is subject to the approval of the members at the ensuing Annual General Meeting. The dividend shall be paid to members whose names appear in the Registrar of Members as on 29th July, 2016 and in respect of shares held in dematerialized form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owner as on that date. The dividend income is tax free in the hands of the shareholders. AMOUNT TRANSFERRED TO RESERVE Your company proposed to transfer an amount of Rs. 30,00,000 to general reserve out of the profits of the company. EXTRACT OF ANNUAL RETURN The detail forming part of the extract of the Annual Return in Form No. MGT - 9 in accordance with the provisions of Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as 'Annexure -I' to this Report NUMBER OF BOARD MEETINGS The details of the number of Board and Audit Committee meetings of your Company are set out in the Corporate Governance Report which forms part of this Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013. DIRECTOR'S RESPONSIBILITY STATEMENT Pursuant to Section 134 sub section 5 of the Companies Act, 2013 the directors of your company state- • That in preparation of the annual accounts for the financial year ended 31st March, 2016, the applicable accounting standards have been followed and there are no material departures form the same. • That the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the company at the end of the financial year as at 31st march, 2016 and of the profit of the Company for the year ended 31st March, 2016. • That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 2013 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities. • That the annual accounts have been prepared on a going concern basis. • That proper internal financial controls laid down by the directors to be followed by the Company and that such internal financial controls are adequate and is operating effectively; and • That proper system to ensure compliance with the provisions of all applicable laws is adequate and is operating effectively. Your Company has received declarations from all the Independent Directors that they meet the criteria of independence as laid down under the Companies Act, 2013 read with Schedule and Rules issued thereunder, and also in accordance to Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements) Regulations, 2015. REMUNERATION POLICY Your company has adopted the remuneration policy in accordance with Section 178 read with rules made thereunder for director's appointment and remuneration including the criteria for determining qualifications, positive attributes, independence of a director, etc. in the meeting of Board of Directors of the Company held on 9th Feb, 2015 in line with the recommendation of Nomination and Remuneration Committee; whose meeting also held on the same date. The remuneration policy of your Company is annexed in Annexure-II. The policy has been disclosed on the website of the company. AUDIT AND AUDITOR'S REPORT: STATUTORY AUDITORS: M/s. Goel Garg & Company, Chartered Accountants, were appointed as Statutory Auditors of the Company to hold till the conclusion of ensuing Annual General Meeting. STATUTORY AUDITOR'S REPORT There are no such observations in the statutory audit report which needs to be explained by your Company. The observation of the auditors is self- explanatory and/or is suitably explained in the notes to the accounts. SECRETARIAL AUDITOR: M/s A.K Associates, Practicing Company Secretary, were appointed as Secretarial Auditor for the financial year 2015-16 for secretarial audit of your company. SECRETARIAL AUDIT REPORT There are no such observations in the secretarial audit report which needs to be explained by your Company. The report of secretarial auditor is annexed to this report as Annexure VIII. PARTICULARS OF LOAN, GUARANTEES OR INVESTMENT BY THE COMPANY Your Company has not given any loan, guarantee or made any investment in any other body corporate as per the provision of section 186 of the Companies Act, 2013. RELATED PARTIES TRANSACTIONS All related party transactions that were entered into during the financial year 2015-16 were in the ordinary course of business and on an arm's length basis or with required approvals. Your company has also adopted a policy on materiality of related parties transaction and also dealing with related parties' transaction as approved by the Board. The policy has been disclosed on the website of your company at www.machino.com . The details of related parties transaction whether requiring approvals or otherwise, as per the provision of Section 188 of the Companies Act, 2013 form AOC-II is annexed in Annexure-III. STATE OF COMPANY'S AFFAIR Your company is a joint venture Company of Maruti Suzuki India Limited, Suzuki Motor Corporation and Jindal's. Your company was incorporated in 1986. The shares of your company are listed on Bombay Stock Exchange Limited. Your company is engaged in the production of plastics moulded automotive components. Your company has two operative plants in Gurgaon and Manesar. The plants in Pithampur is yet to commence production. Your company is a going concern. During the year under review, your company has not made any default in repayment of any of its term loans, have met generally all its obligation in time including its tax liabilities. DETAILS OF SIGNIFICANT AND MATERIAL ORDER No significant or material orders have been passed by any regulators or court or tribunals impacting the going concern status and future operations of your company. MATERIAL CHANGES AND COMMITMENTS No significant changes and commitments affecting the financial position of your company from the financial year ending on 31st March, 2016 till the date of this report. CONSERVATION OF ENERGY Continuous overhauling of equipments and awareness amongst employees has helped to avoid wastage of energy. Series of steps have been taken to identify areas of excess consumption of power and checks have been strengthened at these points and various alternative sources of energies are utilized. TECHNOLOGY ABSORPTION A statement giving details of technology absorption in accordance with the above Rules is annexed hereto as Annexure IX and forms part of the Report. FOREIGN EXCHANGE EARNING & OUTGO Rs. In Lacs Total foreign exchange earning 85.36 Total foreign exchange outgo 195.70 RISK MANAGEMENT POLICY Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your company already has "Risk Management Policy" in writing which is also uploaded on the website of the company. The policy is regularly reviewed. Your company manages monitors and reports on the principal risks and uncertainties that can impact its ability to achieve its strategic objectives. Your company has also constituted a risk management committee during the year under review the details of which is given in the Corporate Governance section of the Annual Report. ANNUAL EVALUATION OF PERFORMANCE The performance evaluation of all: • independent directors were made by Board (excluding the director who performance is being evaluated), • non independent directors were made by the independent directors in its meeting • the board committees and of the board as whole was made by Nomination and Remuneration Committee Your company has also adopted a policy for evaluation of performance of the board and individual director in the meeting of the board of directors in line with the recommendation of Nomination and Remuneration Committee. The policy of annual evaluation is annexed in Annexure - IV. The policy has also been disclosed on the website of the company. VIGIL MECHANISM Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, your Company has established the Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations & Disclosure Requirements), Regulations, 2015 for directors and employees of the Company to report genuine concerns or grievances. The Vigil Mechanism provides the safeguard against the victimization of person who uses such mechanism. During the financial year 2015-16, all the directors and employees had full access to approach the Vigil Mechanism Officer. No complaint was received during the year 2015-16 of any sort from any directors and employee of your company. The detail of establishment of such mechanism is also disclosed on the website of the Company and also enclosed as per Annexure -V. DIRECTORS Appointments: During the Financial Year 2015-16, Mr. Aditya Jindal was appointed as an Additional Director/Executive Director of your Company at the meeting of the Board of Directors held on 13th February, 2016 and subsequently he will be appointed as an Executive Director by the shareholders at the AGM held on 29th July, 2016. Cessations: Mr. G.C. Dwivedi an Independent Director of your Company demised on 5th March, 2016 .Therefore, he ceases to be the Director of your Company w.e.f. 5th March, 2016. Resignation: In accordance with the provisions of Section 168(1) of Companiex Act, 2013, Mr M.D.Jindal, the Executive Chairman of your company has resigned w.e.f. 01st June, 2016. AUDIT COMMITTEE The details of the Audit Committee Including its composition and terms of reference mentioned in the Corporate Governance Report forms part of Director's Report. FAMILIRISATION PROGRAMME FOR THE INDEPENDENT DIRECTOR Your Company has organized a familiarisation programme for the independent directors as per the requirement of the Companies Act, 2013 along with the requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 The details of such familiarisation programme are also uploaded on the website of the company at www.machino com. LISTING The Equity Shares of the Company are listed on Bombay Stock Exchange. The company has paid listing fees to the Stock Exchange for the year 2016-17. CORPORATE GOVERNANCE Your Company always places major thrust on managing its affairs with diligence, transparency, responsibility and accountability thereby upholding the important dictum that an organization's corporate governance philosophy is directly linked to high performance. Pursuant to Regulation 27(2) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 with the Stock Exchanges, Reports on Corporate Governance has been included in this annual report as a separate section (forming a part of Director's Report)along with the Auditor's Certificate. DEPOSITS Your Company has not accepted any deposits under Section 73 of the Companies Act, 2013 & rules made there under. MANAGEMENT DISCUSSION AND ANALYSIS REPORT As required by Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report is presented in a separate section forming part of the annual report. DETAILS OF SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES None of the company has become or ceased to become the subsidiary, joint venture or associate of your Company during the financial year 2015-16. PARTICULAR OF EMPLOYEES Details of employee of the Company as specified under Section 197 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed hereto as Annexure-VI and forms part of the report. ENVIRONMENT The Company is not involved in any type of activity hazardous to environment and does not discharge any trade effluents (solid, liquid or gaseous) causing pollutions. As an environment conscious responsible corporate citizen, your Company has implemented GSCM (Green Supply Chain Management) standards and is ISO14001 certified holder. The Company has also achieved ISO 18001-OHSAS certification for occupational health and safety. CORPORATE SOCIAL RESPONSIBILITY The provision of section 135(1) of Comapnies Act 2013 i.e. Corporate social responsibility is not applicable on your company. Therefore your company has not constituted CSR committee for this. ACKNOWLEDGEMENTS Your Directors wish to place on record their appreciation for the valuable co-operation and assistance extended by Maruti Suzuki India Limited., Suzuki Motors Corporation, Japan, Government of India, Government of Haryana and the Company's bankers for their continued support and guidance. The Directors also commend the continuing commitment and dedication of the employees at all levels and are thankful to the shareholders for their continued patronage, trust and confidence in the Company. For and on behalf of the Board Machino Plastics Limited Sd/- Aditya Jindal Executive Director Sd/- Sanjiivv Jindall Chairman Place : Gurgaon Date : 27th May, 2016 |