Your Directors have pleasure in presenting their 57th Annual
Report and the Audited Accounts of the Company for the year ended 31st March
2022.
FINANCIAL RESULTS
|
For the Year ended 31.03.2022 |
For the Year ended 31.03.2021 |
|
Rs in lakhs |
Rs in lakhs |
|
Separate |
Separate |
Total Revenue |
1,21,447 |
1,04,952 |
Operating Profit : Profit before Interest, Depreciation and
Tax (PBIDT) |
19,810 |
19,753 |
Less : Interest |
853 |
949 |
Profit before Depreciation and Tax (PBDT) |
18,957 |
18,804 |
Less : Depreciation |
2,931 |
2,762 |
Add : Exceptional items |
- |
- |
Net Profit/ Loss before Tax (PBT) |
16,026 |
16,042 |
Less: Provision for Taxation - Current |
4,609 |
4,541 |
Deferred |
724 |
423 |
Net Profit / Loss after Tax (PAT) |
10,693 |
11,078 |
Other Comprehensive Income for the year (Net of Tax) |
(177) |
1,429 |
Total Comprehensive Income for the year (TCI) Movement of
Retained earnings |
10,516 |
12,507 |
Opening balance of Retained earning |
34,983 |
26,674 |
Add: Profit for the year |
10,693 |
11,078 |
Less: Dividend paid during the year |
- |
(867) |
Less: Transfer to General Reserve |
(1,600) |
(1,900) |
Add : Transfer from FVTOCI Reserve |
(5) |
(2) |
Closing balance of Retained earnings |
44,071 |
34,983 |
SHARE CAPITAL
The paid-up capital of the Company is ' 8,66,63,060/- consisting of
8,66,63,060 shares of Rs1/- each. There has been no change in the capital structure of the
Company during the year under review. The Company does not have any scheme for issue of
sweat equity to the employees or Directors of the Company.
DIVIDEND
Your Directors have recommended a dividend of Rs1/- per equity share
for the year 2021-2022 which amounts toRs866.64 lakhs. For the previous year 2020-21, the
Company had paid dividend of '1.00 per share which amounts toRs866.64 lacs.
The above recommendation of the dividend by the Directors is in
accordance with the "Dividend Distribution Policy" of the company. The Policy is
available on the website of the Company under the weblink - http://www.ramcoindltd.com/policies.html
The Dividend Distribution Policy forms part of this report.
TRANSFER TO GENERAL RESERVE
After appropriations, a sum of Rs440.71 crores has been kept as
retained earnings of the company and a sum of Rs16 crores has been transferred to General
Reserve. As on 31-03-2022, the General reserve stands atRs498.73 Crores.
TAXATION
An amount of Rs46.09 crore (P.YRs45.41 crore) towards Current
Tax,Rs7.24 crore (P.YRs4.23 crore) towards Deferred tax has been provided for the year
under review.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT GLOBAL ECONOMY
The war in Ukraine has triggered a costly humanitarian crisis that
demands a peaceful resolution. At the same time, economic damage from the conflict will
contribute to a significant slowdown in global growth in 2022 and add to inflation. Fuel
and food prices have increased rapidly, hitting vulnerable populations in low-income
countries hardest.
Global growth is projected to slow from an estimated 6.1 percent in
2021 to 3.6 percent in 2022 and 2023. This is 0.8 and 0.2 percentage points lower for 2022
and 2023 than projected in January. Beyond 2023, global growth is forecast to decline to
about 3.3 percent over the medium term. War-induced commodity price increases and
broadening price pressures have led to 2022 inflation projections of 5.7 percent in
advanced economies and 8.7 percent in emerging market and developing economies-1.8 and 2.8
percentage points higher than projected last January. Multilateral efforts to respond to
the humanitarian crisis, prevent further economic fragmentation, maintain global
liquidity, manage debt distress, tackle climate change, and end the pandemic are
essential.
INDIAN ECONOMY
Asian Development Bank (ADB) during May 2022 said that Indian economy
is projected to grow by 7.5 per cent in the current financial year and the growth would
accelerate to 8 per cent in 2023-24.The economic growth in the coming years will be
supported by increased public investment in infrastructure and a pickup in private
investment, according to the Asian Development Outlook (ADO) 2022, the latest edition of
ADB?s flagship economic publication.
The outlook assumes sustained progress in COVID-19 vaccinations while
also that any new variants of the virus would be of limited severity. It also factors in
the impact of Russia?s invasion of Ukraine, primarily higher global oil and commodity
prices that will contribute to rising inflation and a widening of the current account
deficit, ADB said in the report.
"India is on the path to a sustained economic recovery, thanks to
the vigorous countrywide drive to deliver safe and wide-reaching COVID-19 vaccinations,
which helped reduce the severity of the third pandemic wave with minimal disruptions to
mobility and economic activity," said ADB Country Director for India Takeo Konishi
Global Economy.
OUTLOOK
The Increasing government funding in public infrastructure is expected
to encourage growth and attract private investment through a strong multiplier effect in
the industry. However, supply-side bottlenecks are expected to remain persistent with
gradually rising international crude oil prices and growing raw material costs in 2022-23.
The availability of budgetary space to ramp up capital spending, advantage from
supply-side reforms, regulatory relaxation, and continued export growth will also
contribute to growth in 2022-23. As per IMF?s World Economic Outlook projections,
India?s real GDP is projected to grow at = 8.9% in 2022-23 and 7.1% in 2023-24, which
is expected to make India the fastest growing major economy in the world for all 3 years
between 2021-22 and 2023-24.
Review of Operations and Current Trends
A. BUILDING PRODUCTS DIVISION:
|
PRODUCTION |
SALES |
TURNOVER |
PRODUCT |
Qty. in M.T. |
Qty. in M.T. |
Rs in Lakhs |
|
31.03.22 |
31.03.21 |
31.03.22 |
31.03.21 |
31.03.22 |
31.03.21 |
Fibre Cement Sheets |
6,52,460 |
6,10,925 |
6,73,621 |
6,22,731 |
76,551 |
71,361 |
Fibre Cement Boards |
85,795 |
68,032 |
87,018 |
75,387 |
18,047 |
13,166 |
a. Fibre Cement (FC) Sheets:
During the year under review, the Sales quantity of FC Sheets grew by
around 8% compared to previous year and the Industry reportedly grew by 6% for the year.
Specific Markets in East and West registered a strong growth.New geographical markets for
sales are being explored amid stiff competition.
Distribution width and depth was the growth engine last year and will
continue to remain for the year 2022-23 as well. Realisation was down by 1% inspite of raw
material, transportation cost increase thereby affecting the margins.
There was demand noticed in specific segments of industries viz Tiles,
Ceramics & Poultry for roofing requirements. Depreciation of Rupee also affected the
raw material?s cost.
Consistent and Judicious usage of raw materials and supplier
negotiations helped to partially mitigate the impact. Strong correlation in sales was
noticed when the prices of substitutes went up. Seeding of Color Sheets in existing
distribution network is expected to help build new segment.
Promotional efforts are vigorously taken to explore new potential areas
with more customized products. Greencor, Non-Asbestos roofing sheets have been well
accepted in the market and sales has been in encouraging state.
b. Fibre Cement Boards :
Post the revival after the pandemic, markets had opened from the second
quarter of 2021-22. Hicem witnessed a growth of approximately 14% over the prev'ous year.
Hilux and Greencor recorded a good growth of about 40% over the last
fiscal. Large projects which were on hold due to the pandemic were re-started and this had
helped to build the volumes. Overall the Non-Asbestos category grew by 25% of previous
year. New Products like HIDEN (High Density Fibre Cement Boards), Hilite (Low Density
Calcium Silicate Tiles) and INSTAWALL (Sandwich Panels) are being planned and are expected
to be launched by the 2nd Quarter of 2022-23.
New digital campaigns have been planned for the year 2022-23, which
will help to penetrate new markets and particularly Tier 2 Cities/ Towns. Special focus
has been brought in for appointment of channel partners in Second Tier towns which will
bring in volumes additionally. 7 Large hospital projects for Cov'd in Delhi have been
finalized, which will bring 6,000 MT of Hilux additionally.
Exports: New partners have been appointed in Nepal, US, UK and Canada
for Non-Asbestos and this will bring in additional volumes for the fiscal.
There were a quite a few large volume orders which remained unexecuted
due to very steep increase in freight costs, and also due to acute shortage in container
availability. Steady increase in demand for Greencor is seen from Nepal, Oman & UAE.
5 New Export markets have been added and Export Sales has been getting
back to the earlier levels, very positive during the last financial Year.
SmartBuild Tech Serv'ces offering complete solutions and awareness in
Green Dry Construction was started in September 2017 currently executing turnkey projects
with an approximate value of Rs10 Crores. Also have promising venture of approximatelyRs25
Crores of business, expected in FY 2022-2023.
Ramco SmartBuild has Designed Government Projects for Greater Chennai
Corporation and Company?s Products are Specified in their Tender / BOQ which is
currently in Execution Phase.
Ramco SmartBuild Offers Various Technical Methodologies using G I
Frames, LGSF (Light Gauge Steel Frame), Hybrid Structures in Dry Wall Partition, False
Ceiling, Ramco InstaWall Panels in various locations.
In this year, SmartBuild Team and R&D are jointly working in the
Development of Prefab Dry Wall Panels and Factory Engineered Buildings.
c. Fibre Cement Pressure Pipes:
Operations of Pressure Pipes continued to be under pressure owing to
the sluggish market. The existing lease agreement entered into with M/s Kanoria Sugar and
General Manufacturing Company Limited has ended in March 2022.
B. WIND MILLS:
During the Financial Year 2021-22, the Wind energy was moderate with
decrease of 3% compared to last year, from the existing 15 Wind Mills.
Position regarding Wind Mills was as follows: - Total Capacity
Installed : 16.73 MW
Total Units generated : 232 Lakh Units (P.Y: 239 Lakh Units)
Income earned :Rs1,389 Lakhs (P.Y:Rs1,456 Lakhs)
(by generation/sale of power)
C. COTTON YARN DIVISION - SRI RAMCO SPINNERS :
Production and Sales :
During the year 2021-22, the Unit had produced 30.52 Lakh Kgs. of
Cotton Yarn as compared to 25.22 Lakh Kgs. produced during the previous year.
The Unit had sold Yarn at 35.09 Lakh Kgs. (including traded yarn)
during the year under review as against 33.28 Lakh Kgs. during the year 2020-21.
During the year under review, the performance of the Cotton yarn
division increased when compared to previous year. Increase of yarn selling price,
reduction in power cost, due to implementation of energy saving measures and decrease of
manpower cost on account of Automation of machineries in the second half year, contributed
for growth in the performance of the Company and savings in the operating cost during the
year 2021-22.
Expecting the same Level of moderation in cotton prices & stability
in yarn prices, your Directors are hopeful in achieving good results during the year
2022-23.
The Company was able to overcome the challenges posed by pandemic by
continuous engagement with the Customers and none of the sales contracts was cancelled
during this challenging period, though there was some deferment in the delivery schedule,
which has been subsequently shipped successfully.
There is a steep increase in Raw Cotton price and stability in yarn
price. There is huge demand in Raw Cotton in the Market and the Ginners are not able to
reduce the price. This will affect the profitability in the current year 2022-23.
The Company is taking various steps to expand its market presence both
in domestic and international markets and hope to achieve higher volume of sales in value
added yarns in the forthcoming years.
D. OVERSEAS OPERATIONS OF SUBSIDIARIES - SRI RAMCO LANKA (PRIVATE)
LIMITED AND SRI RAMCO ROOFINGS LANKA (PRIVATE) LIMITED, SRI LANKA:
There was increase in sales during the last year.
At a Consolidated level of both the Companies, the Net Sales were SLR
82,752 lakhs (INR 30,362 lakhs) as against SLR 58,135 lakhs (INR 22,934 lakhs ) during the
corresponding previous year.
In accordance with Rule 5 of Companies (Accounts) Rules, 2014, a
statement containing the salient features of the Financial Statements of the subsidiaries
is attached in Form AOC-1 as Annexure -1 to the Board?s Report.
The Company proposes to transfer an amount of Rs1,600 lakhs to the
General Reserves. An amount of Rs44,071 lakhs is proposed to be retained in the statement
of Profit and Loss.
The Company has no material subsidiaries.
CONSOLIDATED FINANCIAL STATEMENTS :
The Company has 6 Associate Companies viz. The Ramco Cements Limited,
Rajapalayam Mills Limited, Ramco Systems Limited, Ramco Industrial and Technology Services
Limited, Madurai Trans Carrier Limited and Lynks Logistics Limited.
As per provisions of Section 129(3) of the Companies Act, 2013 and
Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
[SEBI(LODR)], Companies are required to prepare Consolidated Financial Statements of its
subsidiaries and Associates to be laid before the Annual General Meeting of the Company.
Accordingly, the Consolidated Financial Statements incorporating the accounts of
Subsidiary Companies and Associate Companies along with Auditors? Report thereon,
forms part of this Annual Report.
As per Section 136(1) of the Companies Act,2013 the financial
statements including consolidated financial statements are available at the Company?s
website at the following link at
http://www.ramcoindltd.com/financial_performance.html
Separate audited accounts in respect of the subsidiary companies are
also made available at the Company?s website. The Company shall provide a copy of
separate audited financial statements in respect of its subsidiary companies to any
shareholder of the Company who asks for it.
The consolidated net profit after tax of the Company amounted
toRs126.52 crores for the year ended 31st March, 2022 as compared toRs115.93
crores of the previous year.
The Consolidated Total Comprehensive Income for the year under review
isRs301.02 crores as againstRs289.29 crores of the previous year.
Key Financial Ratios
Pursuant to Schedule V (B) of LODR, the Key Financial Ratios for the
year 2021-22 are given below:
, Particulars No. |
Ratios |
Variations |
Formula Adopted |
Reasons where the variance is over 25% |
|
FY21-22 |
FY20-21 |
|
|
|
1. Debtors turnover ratio (days) |
32 |
31 |
3% |
365 days/(Net Revenue/ Average Trade Receivables) |
|
2. Inventory turnover ratio (days) |
111 |
121 |
-8% |
365 days /(Net Revenue / Average Inventories) |
|
3. Interest coverage ratio (times) |
23.22 |
19.42 |
20% |
(Operating Profit Before Tax+Interest)/ (Interest+ Interest
Capitalised) |
|
4. Debt service Coverage Ratio (Times) |
7.73 |
3.52 |
119% |
(EBITDA - Current Tax) / (Principal repayment +Total
Interest) |
Lower Term Loan repayment and reduced interest rates during
the current year has improved the ratio |
5. Current ratio (Times) |
1.35 |
1.38 |
-2% |
Total Current Assets/ Total Current Liabilities |
|
6. Debt-equity ratio (Times) |
0.22 |
0.17 |
29% |
Total Debt/Total Equity |
The variation is due to increased working capital borrowing |
7 Operating Profit margin (%) |
14% |
16% |
-13% |
Operating Profit Before Tax/Net Revenue |
|
8. Net Profit margin (%) |
9% |
11% |
-18% |
Net Profit/Net Revenue |
|
9. Return on Net worth (%) |
13% |
17% |
-24% |
Total Comprehensive Income + Interest/ Average Net worth |
|
10. Total Debt/EBITDA (Times) |
1.13 |
0.77 |
47% |
Total Debt/EBITDA |
Increase in Borrowings |
11. Return on Capital Employed (%) |
10% |
13% |
-23% |
Total Comprehensive Income + Interest/ (Average of Equity
plus Total Debt) |
|
12. Price Earnings Ratio (Times) |
17.08 |
20.08 |
-15% |
Market Price per share as at 31st March/Earning
per share |
|
a. EBITDA denotes Operating Profit Before Tax + Interest + Depreciation
DIRECTORS
Pursuant to rule 8(5) (iii) of the Companies (Accounts) Rules, 2014, it
is reported that, there have been no changes in the Key Managerial Personnel during the
year under review.
In accordance with the Section 159 and other applicable statutory
provisions of the Companies Act, 2013, Regulation 17(1A) of LODR and the Company?s
Articles of Association, Shri N.K.Shrikantan Raja (DIN: 00350693), Director, retires at
the ensuing Annual General Meeting and being eligible, has offered himself and seeks for
his re-appointment vide Special Resolution as he will be attaining the age of 75 years
during his next tenure, which was recommended by Nomination and Remuneration Committee.
Based on the recommendation of the Nomination and Remuneration
Committee, the Board of Directors on 18-05-2022 re-appointed Shri P.V. Abinav
Ramasubramaniam Raja (DIN 07273249) as Managing Director of the Company, subject to the
approval of members, for a period of 5 years from 4-06-2022 to 3-06-2027. The Special
Resolution for his re-appointment as Managing Director and remuneration payable to him
have been included in the Notice convening 57th Annual General Meeting for the
approval of Members.
The Independent Directors hold office for a fixed term of 5 years and
are not liable to retire by rotation. The Company has received necessary declarations from
all the Independent Directors of the Company under Section 149(7) of the Companies Act,
2013 that they meet the criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013.
Independent Directors have complied with the code for Independent
Directors prescribed in Schedule IV to the Act.
The Company had formulated a code of conduct for the Directors and
Senior Management Personnel and the same has been complied with.
The Audit Committee has five members, out of which four are Independent
Directors. Shri Ajay Bhaskar Baliga, Independent Director has been inducted as member of
Audit Committee and Risk Management Committee. Pursuant to Section 177(8) of the Companies
Act, 2013 it is reported that there has not been an occasion, where the Board had not
accepted any recommendation of the Audit Committee.
In accordance with Section 178(3) of the Companies Act, 2013 and based
upon the recommendation of the Nomination and Remuneration Committee, the Board of
Directors has approved a policy relating to appointment and remuneration of Directors, Key
Managerial Personnel and Other Employees.
As per Proviso to Section 178(4), the salient features of the
Nomination and Remuneration Policy should be disclosed in the Board?s Report.
Accordingly, the following disclosures are given:
Salient Features of the Nomination and Remuneration Policy:
The objective of the Policy is to ensure that -
(a) the level and composition of remuneration is reasonable and
sufficient to attract, retain and motivate directors of the quality required to run the
company successfully;
(b) relationship of remuneration to performance is clear and meets
appropriate performance benchmarks;
(c) remuneration to directors, key managerial personnel and senior
management involves a balance between fixed and insentive pay reflecting short and
long-term performance objectives appropriate to the working of the Company and its goals.
The Nomination and Remuneration Committee and this Policy are in
compliance with the Companies Act, 2013 and LODR. Among other things, during the year
under review, the responsibilities of compensation committee as defined in SEBI (Share
Based Employee Benefits and Sweat Equity) Regulations, 2021 have been assigned to
Nomination and Remuneration Committee.
The web address of the Policy is - http://www .
https://www.ramcoindltd.com/file/Investors/Policies/Nomination_and_Remuneration_ Policy.pdf
As required under Regulation 25(7) of SEBI (LODR) Regulations, the
Company has programmes for Familiarisation for the Independent Directors about the nature
of the Industry, Business model, roles, rights and responsibilities of Independent
Directors and other relevant information. As required under Regulation 46(2)(i) of SEBI
(LODR) Regulations the details of the Familiarisation Programme for Independent Directors
are available at the Company?s website, at the following link at
http://www.ramcoindltd.com/file/Investors/ Board_of_Directors/2021-2022/DIRECTORS
FAMILIARISATION PROGRAMME 2021-22.pdf
The details of the familiarization programme are explained in the
Corporate Governance Report also.
BOARD EVALUATION
Pursuant to Section 134(3)(p) of the Companies Act, 2013, and
Regulation 25(4) of LODR, Independent Directors have evaluated the quality, quantity and
timeliness of the flow of information between the Management and the Board, Performance of
the Board as a whole and its Members and other required matters.
Pursuant to Schedule II, Part D of LODR, the Nomination and
Remuneration Committee has laid down evaluation criteria for performance evaluation of
Independent Directors, which is based on attendance, expertise and contribution brought in
by the Independent Director at the Board and Committee Meetings, which shall be taken into
account at the time of reappointment of Independent Director.
Pursuant to Regulation 17(10) of LODR, the Board of Directors have
evaluated the performance of Independent Directors and observed the same to be
satisfactory and their deliberations beneficial in Board / Committee meetings.
Pursuant to Regulation 4(2)(f)(ii)(9) of LODR, the Board of Directors
have reviewed and observed that the evaluation framework of the Board of Directors was
adequate and effective.
The Board?s observations on the evaluations for the year under
review were similar to their observations for the previous year. No specific actions have
been warranted based on current year observations. The Company would continue to
familiarise its Directors on the industry, technological and statutory developments, which
have a bearing on the Company and the industry, so that Directors would be effective in
discharging their expected duties.
MEETINGS
During the year, eight Board meetings were held. In accordance with
Clause 9 of Secretarial Standard 1, the details of number and dates of Meetings of the
Board and Committees held during the financial year indicating the number of meetings
attended by each Director are given in the Corporate Governance Report.
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.
PUBLIC DEPOSITS
The Company had no fixed deposits. The Company has decided not to
accept fresh deposits from 01.04.2014 and to avail the option provided under Section 74 of
the Companies Act, 2013 and repaid all the existing deposits together with the accrued
interest thereon by complying with the formalities required in this regard.
ORDERS PASSED BY THE REGULATORS
Pursuant to Rule 8 (5) (vii) of Companies (Accounts) Rules, 2014 it is
reported that no significant and material orders have been passed by the Regulators or
Courts or Tribunals impacting the going concern status and Company?s operations in
future.
INTERNAL FINANCIAL CONTROLS
In accordance with Section 134(5)(e) of the Companies Act, 2013, the
Company has Internal Financial Controls Policy by means of Policies and Procedures
commensurate with the size & nature of its operations and pertaining to financial
reporting. In accordance with Rule 8(5)(viii) of Companies (Accounts) Rules, 2014, it is
hereby confirmed that the Internal Financial Controls are adequate with reference to the
financial statements.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Pursuant to Section 186(4) of the Companies Act, 2013 the details of
Loans, Guarantees and Investments along with the purposes are provided under Notes No.08,
09,39 and 44 of Notes to the separate Financial Statements.
AUDITS
STATUTORY AUDIT
As per the provisions of Section 139 of the Companies Act,2013 the
first term of office of M/s.Ramakrishna Raja and Co., Chartered Accountants, (FRN:005333S)
and M/s.SRSV & Associates, Chartered Accountants, (FRN:015041S), who have been
appointed as the Statutory Auditors of the company at the 52nd Annual General
Meeting, comes to an end at the close of the 57th Annual General Meeting of the
Company.
No change is proposed in the Auditors for the Company. The Existing
Auditors are eligible for re-appointment for the second term of 5 years.
Subject to the approval of the Members of the Company at the ensuing 57th
Annual General Meeting, the Board of Directors have recommended the appointment of M/s
Ramakrishna Raja and Co., Chartered Accountants, (FRN:005333S) and M/s. SRSV &
Associates, Chartered Accountants, (FRN:015041S) as Statutory Auditors of the Company,
pursuant to Section 139 of the Companies Act,2013. The Audit Committee at its Meeting held
on 18.05.2022 had recommended their re-appointment as Statutory Auditors for second term,
pursuant to Section 139(11) of the Companies Act, 2013. Written consents from the auditors
for their proposed appointment and necessary certificates under Rule 4 of the Companies
(Audit and Auditors) Rules 2014, confirming that their reappointment if made, shall be in
accordance with the conditions as prescribed by law and they satisfy the criteria provided
under section 141 of the Companies Act, 2013, have been obtained. The proposal relating to
their appointment has been included in the notice convening the 57th Annual
General Meeting of the Company. They shall hold office from the conclusion of 57th
Annual General Meeting till the conclusion of 62nd Annual General Meeting.
In accordance with Regulation 33(1)(d) of SEBI (LODR) Regulations 2015,
the auditors have submitted the necessary certificates issued by Peer Review Board of the
Institute of Chartered Accountants of India.
The report of the Statutory Auditors for the year ended 31st
March, 2022 does not contain any qualification, reservation or adverse remark. No fraud
has been reported by the Company?s Auditors.
COST AUDIT
As per Rule 3 of Companies (Cost Records and Audit) Rules, 2014 the
company is required to maintain cost records and accordingly such records and accounts are
made and maintained.
The Board of Directors at their meeting held on 18.05.2022, as
recommended by Audit Committee, had approved the appointment of M/s N.Sivashankaran &
Co, Cost Accountants as the Cost Auditors of the Company to audit the Company?s Cost
Records relating to manufacture of Fibre Cement Products (FCP & CSB) and Cotton Yarn
for the year 2022-23 at a remuneration of Rs2,50,000/- (Rupees Two lakhs fifty thousand
only) exclusive of GST and out of pocket expenses.
The remuneration of the cost auditor is required to be ratified by the
members in accordance with the provisions of Section 148(3) of the Companies Act, 2013 and
Rule 14 of Companies (Audit and Auditors) Rules, 2014. Accordingly, the matter relating to
their remuneration had been included in the Notice convening the 57th Annual
General Meeting scheduled to be held on 10th August, 2022, for ratification by
the Members.
The Cost Audit Report for the financial year 2020-21 due to be filed
with Ministry of Corporate Affairs (MCA) by 26.08.2021 had been filed on 23.08.2021. The
Cost Audit Report for the financial year 2021-22 due to be submitted by the Cost Auditor
within 180 days from the closure of the financial year will be filed with the MCA, within
30 days thereof.
SECRETARIAL AUDIT
M/s S. Krishnamurthy & Co., Company Secretaries, have been
appointed to conduct the Secretarial Audit of the Company. Pursuant to the prov'sions of
Section 204 (1) of the Companies Act, 2013 the Secretarial Audit Report submitted by the
Secretarial Auditors for the year ended 31st March, 2022 is attached as
Annexure - 2. The report does not contain any qualification, reservation or adverse
remark.
ANNUAL RETURN
In accordance with Clause 22 of Secretarial Standard on Report of the
Board of Directors (SS 4), a copy of the Annual Return in Form MGT-7 for the year ended 31st
March 2022 has been placed on the website of the Company and the web link of such Annual
Return is https://www.ramcoindltd.com/annual_returns.html
CORPORATE GOVERNANCE
The Company has complied with the requirements regarding Corporate
Governance as stipulated in LODR. As required under Schedule V (C) of LODR, a report on
Corporate Governance being followed by the Company is attached as Annexure - 3.
No complaints had been received pertaining to sexual harassment, during
the year under review. The relevant statutory disclosure pertaining to the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, are
available at Point No: 10(l) of Corporate Governance Report.
As required under Regulation 34(3) read with Schedule V Para C (10)(i)
of LODR, Certificate from the Secretarial Auditor that none of the Company?s
Directors have been debarred or disqualified from being appointed or continuing as
directors of Companies, is enclosed as Annexure - 4.
As required under Schedule V (E) of LODR, a Certificate from the
Statutory Auditors of the Company confirming the compliance of conditions of Corporate
Governance is attached as Annexure - 5.
CORPORATE SOCIAL RESPONSIBILITY POLICY
In terms of Section 135 and Schedule VII of the Companies Act, 2013,
the Board of Directors have constituted a Corporate Social Responsibility (CSR) Committee
and adopted a CSR Policy which is based on the philosophy that "As the Organisation
grows, the Society and Community around it also grows."
The Company has undertaken various projects in the areas of education,
health, rural development, water and sanitation, promotion and development of traditional
arts, protection of national heritage, livelihood enhancement projects etc., largely in
accordance with Schedule VII of the Companies Act, 2013.
The CSR obligation pursuant to Section 135(5) of the Companies Act,
2013, for the year 2021-22 isRs174.75 lakhs (after adjusting previous year 2020-21 excess
of Rs16.10 lakhs fromRs190.85 lacs which is 2% of average net profit of past 3 years for
the year 2021-22). As against this, the Company has spentRs202.36 lakhs on CSR. CSR
Committee recommended to carry forward and set off the excess amount spent to the tune of
Rs27.61 lakhs to the financial year 2022-23. Also the Company had spent a sum of Rs83.95
lakhs on other social causes which do not qualify under the classifications listed out in
Schedule VII of the Companies Act, 2013.
The Annual Report on CSR activities as prescribed under Companies
(Corporate Social Responsibility Policy) Rules, 2014 is attached as Annexure - 6.
VIGIL MECHANISM/ WHISTLE BLOWER POLICY
In accordance with Section 177(9) and (10) of the Companies Act, 2013
and Regulation 22 of LODR, the Company has established a Vigil mechanism and has a Whistle
Blower Policy. The Policy provides the mechanism for the receipt, retention and treatment
of complaints and to protect the confidentiality and anonymity of the stakeholders. The
complaints can be made in writing to be dropped into the Whistle Blower Drop Boxes or
through E-Mail to dedicated mail IDs. The Corporate Ombudsman shall have the sole access
to these. The Policy provides to the complainant access to the Chairman of the Audit
Committee. The web link for the Vigil Mechanism is disclosed in the Corporate Governance
Report.
RISK MANAGEMENT POLICY
Pursuant to Section 134 (3) (n) of the Companies Act, 2013 and
Regulation 17(9) of LODR, the Company has developed and implemented the Risk Management
Policy. The policy envisages identification of risk and procedures for assessment and
strategies to mitigate/ minimisation of risk thereof. The Risk Management Policy of the
Company is available at the Company?s website, at the following weblink:http://www.ramcoindltd.com/file/RISK_MANAGEMENT_POLICY_RIL.pdf
RISK MANAGEMENT
The Company?s risk management system is designed to identify the
potential risks that can impact the business and device a framework for its mitigation
along with periodical reviews to reflect changes in market conditions and the
company?s activities. The Company?s Board of Directors has the overall
responsibility of the establishment and oversight of risk management framework. The Audit
Committee and Risk management committee periodically review the execution of risk
management plan and advice the management wherever necessary.
RELATED PARTY TRANSACTIONS
Prior approval / omnibus approval is obtained from the Audit Committee
for all Related Party transactions and the transactions are also periodically placed
before the Audit Committee for its approval. The particulars of contracts entered into by
the Company during the year as per Form AOC 2 is enclosed as Annexure - 7.
No transaction with the related party is material in nature except
transaction with Raja Charity Trust which was approved by Shareholders at the 56th
Annual General Meeting held on 19.08.2021, in accordance with Company?s "Related
Party Transaction Policy" and Regulation 23 of LODR.
In accordance with Ind AS-24, the details of transactions with the
related parties are set out in the Disclosures forming part of Financial Statements.
As required under Regulation 46 (2) (g) of LODR, the Related Party
Transaction Policy is disclosed in the Company?s Website and its weblink is -https://www.ramcoindltd.com/file/Investors/Polides/RELATED_PARTY_TRANSACTION_POLICY_RIL_29012020.pdf
As required under Regulation 46(2)(h) of LODR, the Company?s
Material Subsidiary Policy is disclosed in the Company?s website and its weblink is -
https://www.ramcoindltd.com/file/MATERIAL_SUBSIDIARY_POLICY_2015.pdf
MATERIAL CHANGES SINCE 1st APRIL 2022
There have been no other material changes affecting the financial
position of the company between the end of the financial year and till the date of this
report.
FUTURE OUTLOOK
The world is going through volatile economic situation on account of
War between Russia and Ukraine. Indian Economy is working out alternatives consequent to
Sanctions imposed on Russia on account of the war. The crude prices also have gone up
significantly. Your Company?s raw material is partly met out of mines in Russia and
the sanctions have affected the availability due to supply chain disruptions. Availability
of the Containers and steep increase in Freight is affecting the international trade. Your
company is taking up adequate measures to ensure availability of raw materials to feed the
production.
The political and economic crisis in Sri Lanka is also affecting the
business of the company. Inflation is rising at an alarming level thereby increasing the
input costs. Further, Foreign exchange scarcity / restrictions have resulted in delay in
remittances due to the raw material Suppliers as well as to your company on account of
royalty and dividend incomes. The subsidiary companies? have adequate stocks to
ensure the current production. Your company is keenly watching the situations and is
taking appropriate steps to ensure that subsidiary companies? plants situated in Sri
Lanka are operating.
New construction activity has picked up in the rural markets post Covid
waves, largely because of good monsoon / harvest and push given by the Government through
its spending. The Commodity prices such as Steel also has gone up during the year.
However, the cyclical price movements of steel and other commodities has made trade
watchful on inventories.
The construction industry in India is expected to grow steadily over
the next four quarters. The growth momentum is expected to continue over the forecast
period, recording a CAGR of 9.5% during 2022-2026. The construction output in the country
is expected to reach INR 60,508.9 billion by 2026 due to increased demand from real estate
and infrastructure projects. Indian Real Estate sector expected to reach a market size of
USD 1 Tn by 2030. Its contribution to the country?s GDP is expected to be
approximately 13% by 2025. Government has allocatedRs48,000 crore in the financial budget
of the year for the PM Awas Yojana for housing which is a crucial sector. This may result
in slightly lower profitability as these infrastructure and urban housing are
cost-conscious non-trade channels. In addition to these sectors, rural demand is also
expected to sustain on the back of higher rural incomes witnessed in FY 2021-22 and by
positive farm sentiment with timely rabi sowing and favourable groundwater and reservoir
levels, which are likely to boost rabi yields. With favorable monsoon in 2022 in most
parts of the country the outlook for Kharif crop too looks promising. PMAY-G is expected
to sustain momentum as it utilizes its potential to engage rural workforce and drive rural
employment. Sufficient cash inflow in the rural economy could commensurate in rural
infrastructure creation thus augmenting cement demand.
As we are well positioned in the rural markets, we expect to reap the
benefit of demand growth there. This is driven by focussed distribution efforts. The Union
Budget for the year 2022-23 focused on uplifting of the rural economy, strengthening of
the agriculture sector, annual cash incentive for small farmers, infrastructure creation
and MSME Sector which would augur well for the industry, subject to tapering of the Covid
wave.
Your Company is prepared to meet the demand of the products and is
taking initiatives to increase the market especially in Boards business. USD-INR
volatility could be a dampener for the profitable growth.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
Pursuant to Section 134(3) (m) of the Companies Act,2013 and Rule 8(3)
of Companies (Accounts) Rules, 2014 the information relating to Conservation of Energy,
Technology Absorption and Foreign Exchange Earnings and Outgo is attached as Annexure -8.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
The disclosures in terms of provisions of Section 197(12) of the
Companies Act, 2013 read with Rule 5(1), (2) & (3) of Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, relating to remuneration are prov'ded
in Annexure - 9.
EMPLOYEE STOCK OPTION SCHEME (ESOS)
At the Annual General Meeting held on 19.08.2021 the Members had
approved the following Employee Stock Option Schemes :
Name of the Scheme |
Total No of Options |
Exercise Price |
Vesting Period |
Maximum Term |
Source |
Variation in terms |
ESOS 2021- Plan A |
5,00,000 |
' 1/- per share |
One year from the date of grant |
On or before 31st December of the Immediately
succeeding financial year in which the vesting was done |
Primary |
Nil |
ESOS 2021- Plan B |
5,00,000 |
' 30/- per share |
One year from the date of grant |
On or before 31st December of the Immediately
succeeding financial year in which the vesting was done |
Primary |
Nil |
The purpose of this plan is to facilitate Eligible Persons (Employees
with Long Service and Contributed to the growth of the Company) through ownership of
shares of the Company to participate and gain from the Company?s performance, thereby
acting as a suitable reward. Participation in the ownership of the Company, through share
based compensation schemes will be a just reward for the employees for their continuous
hard work, dedication and support, which has led the Company to be what it is today.
The Plan is intended to:
* Create a sense of ownership within the organisation;
* Encourage Employees to continue contributing to the success and
growth of the organisation;
* Retain and motivate Employees;
* Reward Eligible persons to align their performance with Company
objectives;
* Align interest of Eligible Persons with those of the organisation.
The above said Schemes are in compliance with the SEBI Regulations. The
Company had obtained In-Principle approval for the schemes from National Stock Exchange of
India Limited and BSE Limited, where the company?s shares are listed. In line with
the conditions mentioned in the In-Principle approval issued by National Stock Exchange of
India Limited and BSE Limited, the scheme slightly being modified inline with SEBI (Share
Based Employee Benefits and Sweat Equity) Regulations, 2021 ["SBEB and SE
Regulations"] 2021.
A Certificate from the Company?s Secretarial Auditors, with
respect to implementation of the above Employee Stock Option Schemes in accordance with
SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 Guidelines and
resolution passed by the Members of the Company, has been received and same is attached as
Annexure -10.
Details regarding the above mentioned schemes along with their status
are given below:
|
Total No of Options |
Exercise Price |
No of |
No of |
No of |
Name of the Scheme |
|
|
Options vested |
Options exercised |
Options in force |
Employee Stock Option Scheme 2021 - Plan A (ESOS 2021 - PLAN
A) |
5,00,000 |
Rs 1/- |
133500 |
Nil |
Nil |
Employee Stock Option Scheme 2021 - Plan B (ESOS 2021 - PLAN
B) |
5,00,000 |
Rs 30/- |
12500 |
Nil |
Nil |
The details as required under part F of Schedule I read with regulation
14 of (SEBI Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are
disclosed on the company?s website and the weblink is given below: https://www.ramcoindltd.com/esos.html
INDUSTRIAL RELATIONS a PERSONNEL
Industrial relations continue to be cordial and harmonious at all the
Units. Employees at all levels are extending their fullest co-operation for the various
cost reduction measures of the Company. There is a special thrust on Human Resources
Development with a view to promoting creative and group effort.
CREDIT RATING
The ratings for the Company?s borrowing are available in Corporate
Governance Report.
SHARES
The Company?s shares are listed in BSE Limited and National Stock
Exchange of India Limited and the Annual Listing Fees have been paid for the F.Y. 2022-23
respectively.
INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Dividend amount remaining unclaimed/unpaid for a period of over 7 years
was transferred to IEPF as detailed below:
Dividend Details |
Amount Transferred - ' |
Date of Transfer to IEPF |
Dividend for the year 2013-2014 |
1,27,631 |
05-08-2021 |
Shares corresponding to the said dividend were transferred to IEPF, as
detailed below:
No. of Shares |
Date of Transfer to IEPF |
35,852 |
14-09-2021 |
Year wise amount of unpaid /unclaimed dividend lying in the unpaid
account and corresponding shares, which are liable to be transferred to IEPF and due dates
for such transfer, are tabled below:
Year |
Type of Dividend |
Date of Declaration of Dividend |
Last Date for Claiming Unpaid Dividend |
Due Date for Transfer to IEP Fund |
No. of Shares of Rs1/- each |
Amount of unclaimed / unpaid Dividend as on
31-03-2022 |
2014-15 |
Dividend |
23-09-2015 |
22-09-2022 |
22-10-2022 |
4,44,617 |
1,33,385.10 |
2015-16 |
Dividend |
11-03-2016 |
10-03-2023 |
09-04-2023 |
4,75,044 |
2,37,522.00 |
2016-17 |
Dividend |
04-08-2017 |
03-08-2024 |
02-09-2024 |
3,88,263 |
1,94,131.50 |
2017-18 |
Dividend |
03-08-2018 |
02-08-2025 |
01-09-2025 |
3,04,567 |
1,52,283.50 |
2018-19 |
Dividend |
08-08-2019 |
07-08-2026 |
06-09-2026 |
2,26,188 |
1,13,094.00 |
2019-20 |
Dividend |
03-03-2020 |
02-03-2027 |
01-04-2027 |
3,68,758 |
1,84,379.00 |
2020-21 |
Dividend |
12-03-2021 |
11-03-2021 |
10-04-2028 |
2,33,748 |
2,33,748.00 |
DIRECTORS? RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act, 2013 the Directors
confirm that
(a) They had followed the applicable accounting standards along with
proper explanation relating to material departures if any, in the preparation of the
annual accounts for the year ended 31st March, 2022;
(b) They had selected such accounting policies and applied them
consistently and made judgements 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 on 31st
March, 2022 and of the profit of Company for the year ended on that date;
(c) They had taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of this Act for safeguarding
the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) They had prepared the annual accounts on a going concern basis;
(e) They had laid down internal financial controls to be followed by
the Company and that such financial controls are adequate and were operating effectively;
and
(f) They had devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
RESEARCH AND DEVELOPMENT EFFORTS
During the year, the company continued with research and development
efforts in respect of economical mix and non-conventional fibres in production technology
for manufacture of fibre cement sheets, calcium silicate boards, fibre cement boards and
non-asbestos roofing sheets.
ACKNOWLEDGEMENT
The Directors are grateful to the various Departments and agencies of
the Central and State Governments for their help and co- operation. They are thankful to
the Financial Institutions and Banks for their continued help, assistance and guidance.
The Directors wish to place on record their appreciation of employees at all levels for
their commitment and their contribution.
|
By Order of the Board |
|
For RAMCO INDUSTRIES LIMITED |
Place : Chennai |
P.R. VENKETRAMA RAJA |
Date : 18.05.2022 |
CHAIRMAN |