Your Directors have pleasure in presenting their 59th Annual Report and the
Audited Accounts of the Company for the year ended 31st March 2024.
FINANCIAL RESULTS
|
For the Year ended 31.03.2024 |
For the Year ended 31.03.2023 |
|
in lakhs |
in lakhs |
|
Separate |
Separate |
| Total Revenue |
1,33,355 |
1,33,915 |
| Operating Profit : Profit before Interest, Depreciation and Tax (PBIDT) |
13,856 |
15,147 |
| Less : Interest |
2,450 |
1,912 |
| Profit before Depreciation and Tax (PBDT) |
11,406 |
13,235 |
| Less : Depreciation |
3,451 |
3,148 |
| Add : Exceptional items |
- |
307 |
| Net Profit/ Loss before Tax (PBT) |
7,955 |
10,394 |
| Less: Provision for Taxation - Current |
1,843 |
2,028 |
| Deferred |
152 |
235 |
| MAT Credit reversal of earlier years |
- |
384 |
| Deferred tax adjustment of Earlier year |
- |
(1,986) |
| Net Profit / Loss after Tax (PAT) |
5,960 |
9,733 |
| Other Comprehensive Income for the year (Net of Tax) |
2,010 |
588 |
| Total Comprehensive Income for the year (TCI) |
7,970 |
10,321 |
| Movement of Retained earnings |
|
|
| Opening balance of Retained earning |
56,199 |
44,071 |
| Add: Profit for the year |
5,960 |
9,733 |
| Less: Dividend paid during the year |
(868) |
(867) |
| Less: Transfer to General Reserve |
(1,200) |
(1,500) |
| Add : Transfer from FVTOCI Reserve |
(3) |
4,762 |
| Add: Obligation of Financial guarantee pursuant to IND AS, reversed |
40 |
- |
| Closing balance of Retained earnings |
60,128 |
56,199 |
SHARE CAPITAL
The paid up capital of the of the Company is 8,68,09,060 /- consisting of 8,68,09,060
shares of 1/- 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.
The details of Employees Stock Option Schemes (ESOS) are provided in this Report.
DIVIDEND
Your Directors have pleasure in recommending a dividend of 0.75 per share (PY 1 /-
per share) on the equity capital of the Company.
This would entail an outflow of 651.07 lakhs with a payout ratio of Company's
consolidated post tax profit. As per the Dividend Distribution Policy of the Company, the
Company should strive to distribute at least 10% of Consolidated Post-Tax Profits as
dividend.
The payment of dividend 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 RESERVES
After appropriations, a sum of 601.28 crores has been kept as retained earnings of
the company and a sum of 12 crores has been transferred to General Reserve. As on
31.03.2024, the General reserve stands at 601.28 Crores.
TAXATION
An amount of 18.43 crores (P.Y 20.28 crores) towards Current Tax, 1.52 crores
(P.Y 2.35 crores) towards Deferred tax has been provided for the year under review.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Macro-Economic Review
Global Economy
In 2023, the global economy exhibited strong resilience amidst an uncertain environment
with geopolitical tensions and global energy crisis with multiple sanctions. The global
economy expanded steadily driven by positive supply trends despite central banks raising
interest rates to stabilise prices. The global economy grew by 3.2% in 2023, with a
similar pace expected in 2024 and 2025.
Advanced Economy
Steady employment growth and a pick-up in consumer confidence despite continued
monetary tightening by major central banks aided the growth of advanced economies. Growth
in advanced economies is expected to improve slightly from 1.6% in 2023 to 1.7% in 2024
and 1.8% in 2025.
Emerging Markets and Developing Economies
The emerging markets and developing economies (EMDE) grew by 4.3% in 2023 and is
expected to maintain a steady growth of 4.2% in both 2024 and 2025. EMDEs continue to face
pressure from high public debt and unstable inflation rates. Global growth though
resilient faces the risk from rising interest rates and new price spikes due to
geopolitical conflicts like the Russia-Ukraine war, the Red Sea crisis and the
Israel-Palestine conflict. Multilateral cooperation will help limit the costs and risks of
geoeconomic fragmentation and climate change, speed the transition to green energy, and
facilitate debt restructuring.
(Source: World Economic Outlook-IMF, April 2024)
Indian Economy
Amidst challenging global economic scenario, India continued to be the fastest growing
major economy. India exhibited strong resilience in 2023-24, primarily driven by
government push for infrastructure, digitalisation, ease of doing business, inclusive
growth and improved quality of fiscal spending. India rose to fifth place in the global
investment destination ranking in 2024 as compared to ninth position it held in 2023,
according to PwC CEO's survey. Domestic credit issuance to the commercial sector has also
shown substantial growth. According to Second Advanced estimates by National Statistics
Organisation (NSO), the growth of the economy is estimated at 7.6% in 2023-24, higher than
the 7% growth seen in 2022-23. This acceleration in growth is aided by increased
investment, consumption growth, improved business sentiments and the financial positions
of banks and corporations. Inflation is expected to be controlled and remain within RBI's
target as food prices normalize and government measures like banning exports, increase the
supply of key commodities. According to World Bank estimates, the Indian economy will grow
at 7.5% in FY25 mainly led by activity in services and industry, rapid increase in
investment and government consumption. Financial conditions in India have remained
accommodative amidst global challenges.
(Source: NSO, World bank)
Review of Operations and Current Trends A. BUILDING PRODUCTS DIVISION :
| PRODUCT |
PRODUCTION Qty. in M.T. |
SALES Qty. in M.T. |
TURNOVER in Lakhs |
|
31.03.24 |
31.03.23 |
31.03.24 |
31.03.23 |
31.03.24 |
31.03.23 |
| Fibre Cement Sheets / Boards |
8,17,449 |
8,22,593 |
8,09,428 |
8,05,339 |
1,11,407 |
1,08,449 |
Fibre Cement (FC) Sheets:
During the year under review, the Sales quantity of FC Sheets grew by around 2%
compared to previous year and the Industry reportedly had a static growth for the year.
Specific Markets in East, West & South registered a strong growth. New geographical
markets for sales are being explored amid stiff competition. Competition is seen emerging
from "Single plant Regional Operators".
Projects in West helped grow business with a higher double digit growth.
Distribution width and depth was the growth engine last year and will continue to
remain for the year as well. Taluk level dealer appointment has augmented our
distribution. Sales Realisation was up by 3%, where we constantly adjusted the market
selling price basis demand.
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 Colour Sheets in existing distribution network is expected
to help build new segment. Newer taluk market penetration contributed higher double digit
salience.
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.
Fibre Cement Boards :
Non Asbestos Category volumes declined by 8%. However due to better contribution from
value added products, the value growth was at par to 2022-23.
HICEM witnessed a decline of 16% & HILUX registered a growth of 2% in volumes over
2022-23. HICEM decline was mainly due to the focus on selling in profitable markets &
there is a price pressure due to capacity addition by other players. Efforts are taken for
increasing the traded products like GI Channel & Frames in the brand of HILUX –
PREMIUM to address the customer's key requirement of a bundled solution from Ramco
resulted positively. With this positive response, it is planned to scale up the volumes
further and strengthen the range by adding few more accessories during 2024-25.
Efforts on increasing the sales through converting alternative board products like
Plywood, MDF and WPC by creating Niche Marketing vertical is yielding results and the
contribution from this channel is 12% of our overall volumes during 2023-24. HIDEN (High
Density
Fibre Cement Board) is launched during 2023-24 and the product has been received well.
Retail seeding activities and specifications in Projects are expected to generate
incremental volumes by upselling this new product in Fibre Cement Board category.
In line with the Balanced Score Card objectives, the key focus areas for 2024-25 would
be to build up Influencer/Specifier Database, increase the intensity of connecting with
them and participation in Seminars, Expos & Sponsoring special events on Fire Safety,
Acoustic applications etc., to scale up our volumes.
Exports:
9 new channel partners have been appointed during 2023-24 mainly in Israel, UK,
Maldives, South Africa and Barbados (North America) as part of our distribution expansion
in international markets.
3 new export markets (Egypt, Poland and Antigua) have been added. BBA and KIWA
certifications have helped us to register more than 40% growth in UK markets and will see
a significant jump in 2024-25 as well. Work in Progress for getting our products certified
for the US and Canada Markets.
Sales volume in Fibre Cement Board at GCC and Nepal are in restriction, due to very low
market operating prices by local players and competition.
Red sea issues in the 2nd half of 2023-24 impacted the volumes due to
increased lead time, Port congestion and Container availability. However, the situation
started improving now.
Ramco SmartBuild tech services offering technical support to all marketing channels of
the Company and create awareness on green dry construction. Ramco SmartBuild tech services
delivers design and technical support towards various projects to enhance sale of products
like Hilux, Hicem, Hiden, Hilux Lite and other allied products of the Company.
Ramco SmartBuild focusses on revenue generation through projects, technology selling,
design consulting, and training. Company is training the applicators, students and
technical professionals to promote the organization's vision on Green Dry Construction.
The Company provides technical consultancy for design, structure, finishes and board
related applications for the best outcome of any dry construction project.
Ramco SmartBuild team supports export management in terms of design and consulting to
offer best solutions for various applications in the foreign soil.
Ramco SmartBuild has continuously been working on exploration of various technologies
to deliver optimized solutions on fast as well as superior construction methodology.
B. WIND MILLS:
During the Financial Year 2023-24, the Wind energy was good with increase of 4%
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 : |
278.22 Lakh Units (P.Y: 268 Lakh Units) |
| Income earned : (by generation/sale of power) |
1,817 Lakhs (P.Y: 1,645 Lakhs) |
C. COTTON YARN DIVISION - SRI RAMCO SPINNERS :
Production and Sales :
During the year 2023-24, the Unit had produced 26.65 Lakh Kgs. of Cotton Yarn as
compared to 33.19 Lakh Kgs. produced during the previous year. The Unit had sold Yarn at 28.08
Lakh Kgs. (including traded yarn) during the year under review as against 34.94 Lakh Kgs.
during the year 2022-23. The cotton production in India for the cotton season 2022-23
(October to September) was 319 Lakh bales (170 Kgs), compared to 307 Lakh bales produced
in the previous cotton season, representing a 4% increase. However, due to sluggish market
demand for cotton yarn, the cotton price remained range-bound between 57,000 to 62,000
per candy.
At the beginning of the cotton season 2023-24, the CAI estimated the cotton crop for
the new season to be 294 Lakh bales (compared to the previous year's 319 Lakh bales).
However, the actual cotton arrivals in the market reached 310 Lakh bales. The Cotton
Corporation of India (CCI) covered 33 Lakh bales during 2023-24 and further increased the
MSP price per quintal of medium staple cotton and long staple cotton by 9% and 10%
respectively. Despite some price correction in cotton, the fall in yarn prices was much
sharper, leading to a wider disparity that affected the margins of yarn spinners across
India.
The company strategically shifted its focus to more value-added counts, and imported
more high-quality cotton when prices were at reasonable levels. This strategy helped the
company procure diversified varieties of cotton from across the globe and offer
competitive prices for its yarn. In February 2024, the Government of India exempted
Customs duty on the import of Extra Long Staple Cotton exceeding 32 mm, enhancing the
competitiveness of Indian exporters for premium products.
Expecting the Cotton Prices will come down and increase in yarn prices, your Directors
are hopeful in achieving good results during the year 2024-25.
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 and hope to achieve better performance during the year 2024-25.
D. OVERSEAS OPERATIONS OF SUBSIDIARIES - SRI RAMCO LANKA (PRIVATE) LIMITED AND SRI
RAMCO ROOFINGS LANKA (PRIVATE) LIMITED, SRI LANKA:
At a Consolidated level of both the Companies, the Net Sales were SLR 87,106 lakhs (INR
22,752 lakhs) as against SLR 71,955 lakhs (INR 16,384 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.
There is no proposal to transfer any amount to the General Reserves and any amount to
be retained in the statement of Profit and Loss. The Company has no material subsidiaries.
Divestment of holdings held in Lynks Logistics Limited
During the year under review, the Company had sold its entire shareholding of
45,56,35,662 equity shares held in Lynks Logistics Limited (Lynks) to Bundl Technologies
Private Limited ("Bundl" operationg under the brand name "Swiggy") and
simultaneously acquired 21,95,777 Compulsory Convertible Preference Shares (CCPS) of
Bundl, in consideration of the sale of shares. Accordingly, Lynks ceased to be an
Associate Company with effect from 29th August, 2023.
CONSOLIDATED FINANCIAL STATEMENTS :
The Company has 5 Associate Companies viz. The Ramco Cements Limited, Rajapalayam Mills
Limited, Ramco Systems Limited, Ramco Industrial and Technology Services Limited, Madurai
Trans Carrier 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 to 72.97 crores for the
year ended 31st March, 2024 as compared to 107.62 crores of the previous
year.
The Consolidated Total Comprehensive Income for the year under review is 177.48
crores as against 131.18 crores of the previous year.
Key Financial Ratios
Pursuant to Schedule V (B) of SEBI (LODR), the Key Financial Ratios for the year
2023-24 are given below:
| Sl. No. |
Particulars |
2023-24 |
2022-23 |
Formula adopted |
Variation |
Reasons where the variance is over 25% |
| 1 |
Debtors Turnover Ratio (days) |
19 |
24 |
365 days/(Revenue from sale of Products / Average Trade Receivables) |
-21% |
|
| 2 |
Inventory Turnover Ratio (days) |
158 |
131 |
365 days/(Revenue from sale of Products / Average Inventories) |
21% |
|
| 3 |
Interest Coverage Ratio |
5.64 |
8.08 |
EBITDA/(Interest + Interest Capitalised) |
-30% |
Due to Less Operating Cash Profit and increase in Finance Cost |
| 4 |
Debt Service Coverage Ratio |
2.24 |
4.29 |
(EBITDA-Current Tax)/(Principal repayment + Total Interest) |
-48% |
Due to Less Operating Cash Profit and increase in Finance Cost |
| 5 |
Current Ratio |
1.6 |
1.48 |
Total Current Assets/Total Current Liabilities |
8% |
|
| 6 |
Debt-Equity Ratio |
0.02 |
0.04 |
Long Term Debt / Total Equity |
-50% |
Decrease in Long Term Borrowings |
| 7 |
Operating Profit Margin |
6% |
8% |
Operating Profit Before Tax / Net Income from Operation |
-25% |
Decrease in Operational margin |
| 8 |
Net Profit Margin |
4% |
7% |
Net Profit after Tax / Total Income |
-43% |
Decrease in Operational margin |
| 9 |
Return on Networth |
9% |
12% |
(Total Comprehensive Income + Interest) / Average Net worth |
-25% |
Decrease in Operational margin |
| 10 |
Total Debt / EBITDA |
1.74% |
2.03 |
Total Debt / EBITDA |
-14% |
|
| 11 |
Return on Capital Employed |
7% |
9% |
Total Comprehensive Income + Interest / (Average of Equity plus Total Debt) |
-22% |
|
| 12 |
Price Earnings Ratio |
29.27 |
11.06 |
Market price per share as at 31st March / Earning per share |
165% |
Increase in Market Price and Decrease in Earnings |
EBITDA denotes Operating Profit Before Tax + Interest + Depreciation & Amortisation
Directors and Key Managerial Personnel:
Pursuant to rule 8(5) (iii) of the Companies (Accounts) rules, 2014, it is reported
that Shri Hariharan Thiagarajan (DIN 00174846) has been appointed as an Independent
Director with effect from 1.02.2024 for a period of five years by members, through Postal
ballot. Further Shri R.S Agarwal (DIN 00012594) Independent Director had retired on
31.03.2024 due to completion of two consecutive five years each in office. The Board has
recorded its appreciation for the contributions made by him to the Company during his
tenure.
In accordance with the Section 159 and other applicable statutory provisions of the
Companies Act, 2013, Regulation 17(1A) of SEBI (LODR) and the Company's Articles of
Association, Shri S.S. Ramachandra Raja (DIN 00331491), aged 88 years, retires at the
ensuing Annual General Meeting and being eligible, has offered himself and seeks for his
re-appointment, which was recommended by Nomination and Remuneration Committee and Special
resolution has also been included as he attained the age of 75 years as per Regulation
17(1A) of SEBI (LODR), in the Notice convening the 59th Annual General Meeting
scheduled to be held on 16.08.2024, for the approval of members. Also, Justice Shri P P S
Janarthana Raja (Retd.)(DIN 06702871), aged 73 years, is proposed to be appointed as an
Independent Director for a period of 5 years from 1.10.2024, as recommended by Nomination
and Remuneration Committee and recommended by Board of Directors and a Special resolution
has also been included as he will be attaining the age of 75 years during his term, as per
Regulation 17(1A) of SEBI (LODR), in the Notice convening the 59th Annual
General Meeting scheduled to be held on 16.08.2024, for the approval of members.
The disclosures for appointment/ re-appointment of Directors as required under
Secretarial Standards – 2 are available in the Notice convening the AGM.
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.
Pursuant to rule 8(5) (iii) of the Companies (Accounts) Rules, 2014, it is reported
that there have been no changes in the Directors and Key Managerial Personnel other than
above, during the year under review and after the end of the year and upto the date of the
report. 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 four members after retirement of Shri R.S. Agarwal, Independent
Director on 31.03.2024, out of which three are Independent Directors. 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. The Company
has a policy relating to appointment and remuneration of Directors, Key Managerial
Personnel and Other Employees duly approved by the Board of Directors, based upon the
recommendation of the Nomination and Remuneration Committee, in accordance with Section
178(3) of the Companies Act, 2013.
As per Provision to Section 178(4) of the Companies Act, 2013, 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; and
(c) remuneration to directors, key managerial personnel and senior management involves
a balance between fixed and incentive 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 SEBI (LODR). The web address of the Policy is -
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/files/DIRECTORS_FAMILIARISATION_PROGRAMME.pdf
The details of the familiarization programme are explained in the Corporate Governance
Report also.
The details of remuneration received by the Managing Director, during the year under
review are available in the Corporate Governance report.
BOARD EVALUATION
Pursuant to Section 134(3)(p) of the Companies Act, 2013, and Regulation 25(4) of SEBI
(LODR) Regulations, 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 SEBI (LODR) Regulations, 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 SEBI (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 SEBI (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, seven Board meetings were held. The details of number and dates of
Meetings of the Board and Committees held during the financial year including the number
of meetings attended by each Director are given in the Corporate Governance Report.
The details of the Committees constituted by the Board are available in the Corporate
Governance Report. There are no changes in the composition of the committees during the
year under review.
RECOMMENDATION OF AUDIT COMMITTEE
There has not been an occasion, where the Board had not accepted any recommendation of
any Committee of the Board.
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. The Company is in compliance with all the applicable Secretarial Standards.
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 and 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.9,10,40,41 of Notes to
the separate Financial Statements.
AUDITS STATUTORY AUDIT
As per the provisions of Section 139 of the Companies Act,2013 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, were re-appointed at the 57th
Annual General Meeting of the Company for another and second term of 5 years. No change is
proposed in the Auditors for the Company.
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, 2024
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 28.05.2024, 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 2024-25
at a remuneration of 3,00,000/- (Rupees Three lakhs 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 59th Annual General
Meeting scheduled to be held on 16th August, 2024, for ratification by the
Members.
The Cost Audit Report for the financial year 2022-23 due to be filed with Ministry of
Corporate Affairs by 10.09.2023 had been filed 02.09.2023. The Cost Audit Report for the
financial year 2023-24 due to be submitted by the Cost Auditor within 180 days from the
closure of the financial year will be filed with Ministry of Corporate Affairs, within 30
days of such submission.
SECRETARIAL AUDIT
M/s S. Krishnamurthy & Co., Company Secretaries, has been appointed to conduct the
Secretarial Audit of the Company. Pursuant to the provisions of Section 204 (1) of the
Companies Act, 2013 the Secretarial Audit Report submitted by the Secretarial Auditors for
the year ended 31st March, 2024 is attached as Annexure 2. The report
does not contain any qualification, reservation or adverse remark.
There are no changes in the Statutory, Cost and Secretarial Auditors of the Company
during the year under review and upto the date of this report.
EXTRACT OF 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 2023 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 SEBI (LODR) Regulations, 2015. As required under Schedule V (C) of SEBI
(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 Schedule V (E) of SEBI (LODR), a Certificate from the
Statutory Auditors of the Company confirming the compliance of conditions of Corporate
Governance is attached as Annexure 4.
As required under Regulation 34(3) read with Schedule V Para C (10)(i) of SEBI (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 5. CORPORATE SOCIAL RESPONSIBILITY
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
2023-24 is 214.58 lakhs (after adjusting previous year 2022-23 excess of 46.89 lakhs
from 261.47 lacs which is 2% of average net profit of past 3 years for the year
2023-24). As against this, the Company has spent 218.92 lakhs on CSR. CSR Committee
recommended to carry forward and set off the excess amount spent to the tune of 4.34
lakhs to the financial year 2024-25. Also the Company had spent a sum of 26.83 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 SEBI (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 SEBI
(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/files/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.
| Key Risks |
Mitigation measures |
| Currency Fluctuation Risks |
|
| The Company has exposure to USD and other foreign currency denominated transactions
for import of Raw material, Stores & Spares and Capital goods, besides exports of
finished goods and borrowings in foreign currency. Any unfavourable movement in currency
prices can impact profitability. |
The Company has Forex hedging policies to hedge Foreign currency loans, import
transactionsbybookingforwardcontractsbasedontheprevailingforeignexchange market
conditions, after taking into consideration the anticipated foreign exchange
inflows/outflows, timing of cash flows, tenure of the forward contract. The company, in
its textile Division, avails Packing credit in foreign Currency on receipt of export
orders and hence the incidence of currency fluctuations are minimised. |
| Information Technology Risk |
|
| The Company's operations are completely dependent on IT systems, which requires
careful management of the information that is in our possession to ensure data privacy.
The cyberattack threat of unauthorised access and misuse of sensitive information or
disruption to operations continue to increase across the world. Such an attack would
affect the business operations in a number of ways, including disruption to sales,
production and cash flows, ultimately impacting our results. |
Organization's Critical Data is stored in an Information Rights Management System.
Data is encrypted as per policy, to protect security and privacy. Endpoint device security
is enabled in the entire organization to block all unauthorized data transfers. Strong
virus, malware, grey-ware, spyware, Trojans, spam, ransomware protection systems with
Botnet Protection, Application Control and Web Application Firewall have been deployed.
Hardware like, routers, firewalls, servers, secure remote access, endpoints are kept OEM
up-to-date. All obsolete hardware, software, protocols and operating system are not in
use. Strong IT policies are in place to protect business data and data privacy. All
external communication media have ACL (Access Control List). Integrated Data Protection
Manager deployed for backup purpose. Mission critical applications and data are replicated
from the data centre to Disaster Recovery Site for business continuity. |
| Interest rate Risk |
|
| Interest rate risk arises from long-term borrowings with variable rates, which exposed
the company to cash flow interest rate risk. The Company's fixed rate borrowing are
carried at amortized cost and therefore are not subject to interest rate risk as defined
in Ind AS 107 since neither the carrying amount nor the future cash flows will fluctuate
because of the change in market interest rates. The Company is exposed to the evolution of
interest rates and credit markets for its future refinancing, which may result in a lower
or higher cost of financing, which is mainly addressed through the management of the
fixed/ floating ratio of financial liabilities. |
The Company constantly monitors credit markets to strategize a well-balanced maturity
profile in order to reduce both the risk of refinancing and large fluctuations of its
financing cost. The Company believes that it can source funds for both short term and long
term at a competitive rate considering its strong fundamentals on its financial position. |
| Liquidity Risk |
|
| Liquidity Risks are those risk that the Company will not be able to settle or meet its
obligations on time or at reasonable price |
Monitoring and optimizing working capital is achieved through tightened control
measures in collection of receivables, negotiation of credit periods with suppliers,
maintain adequate inventory based on business requirements and thereby maintaining a level
of cash and cash equivalents deemed adequate to finance the company's operations. The
Company maintains flexibility in funding by keeping both committed and uncommitted credit
lines available with bankers. The Company has laid well defined policies and procedures
facilitated by robust information system for timely and qualitative decision making by the
management including its day-to-day operations |
| Geo-Political Risk - (Russia -Ukrain war risk) |
|
| The company's geo-political risk arises from its sourcing the raw material from Russia
on whom US, UK, EU and other countries have imposed partial sanctions. |
The company is able to import of raw material from Russia and the company's banks are
making payments to Russian origin goods on submission of declaration and after making
necessary checks with respect to restrictions on sanctions. However, to mitigate the risk,
the company reviewing constantly its share of its purchases from non- Russian countries
and also considers making payment to non-Russian countries and in currencies other than
USD. |
|
To mitigate the risk, the company maintains adequate stock levels so that there is no
disruption in production. |
| Credit Risk |
|
| Credit Risk is the risk of financial loss to the Company if the customer or
counterparty to the financial instruments fails to meet its contractual obligations and
arises principally from the Company's receivables. Treasury Operations and other
operations that are in the nature of lease. The Company's exposure to credit risk is
influenced mainly by the individual characteristic of each customer. The Company extends
credit to its customers in the normal course of business by considering the factors such
as financial reliability of customers. The Company evaluates the concentration of the risk
with respect to trade receivables as low, as it customers are located in several
jurisdictions and operate in largely independent markets. |
The Company maintains adequate security deposits / Bank Guarantees from many of its
customers based on market condition. Advance payments are obtained for the value of the
material from the Project / one time / new entrants. The exposures with the Government are
generally unsecured by they are considered as good. However, unsecured credits are
extended based on the creditworthiness of the customers on case to case basis. Trade
receivables are written off when there is no reasonable expectation of recovery, such as a
debtor declaring bankruptcy or failing to engage in a repayment plan with the Company and
where there is probability of default, the Company creates provision based on Expected
Credit Loss for trade receivables under simplified approach. |
| Marketing Risk |
|
| Fibre Cement Industry is a highly competitive industry, largely due to dependants in
fibre imports. More manufacturing capacity have sprung up. |
Quality Product with pricing, Benchmarking, Substitutes and In-House Branding will
help get an edge over competition. |
| Fibre Cement Industries is seasonal in nature and logistic sensitive. |
|
| Human Resource Risk |
|
| Loss of key employees due to resignation or retirement, overstaffing / understaffing,
higher attrition inadequate training for employees, employee wellness, and disturbances in
industrial relations are identified as the key risk factors in human resource |
Human Resource risk is mitigated by forecasting annual manpower to hire right people
at right time. Various retention methodologies are rate, followed like employee friendly
benefits like extending loan schemes, transfer option to preferred location in genuine
cases, Group Medical Insurance and Group Personal Accident Insurance Scheme and buffer
scheme. Training programmes are conducted to employees based on functional roles. Periodic
Wellness sessions on health related topics are being conducted with expert doctors from
reputed hospitals. Maintaining cordial relationship with Unions, local leaders and
carrying out CSR projects relevant to the local needs have ensured that there were no loss
of man-days due to such disturbances. |
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 details 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 56th Annual General
Meeting held on 19.08.2021, in accordance with Company's "Related Party Transaction
Policy" and Regulation 23 of SEBI (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 SEBI (LODR), the Related Party Transaction
Policy is disclosed in the Company's Website and its weblink is -
https://www.ramcoindltd.com/file/Investors/Policies/RELATED_PARTY_TRANSACTION_POLICY_RIL_29012020.pdf
As required under Regulation 46(2)(h) of SEBI (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 2024
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.
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 with respect to remuneration as required under Section 197 of the
Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is attached as Annexure - 9.
The statement containing names of the top ten employees in terms of remuneration drawn
and the particulars of employees as required under Section 197(12) of the Companies Act,
2013 read with Rule 5 (2) & (3) of Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, is provided in a separate Annexure forming part of this
report.
However, the annual report is being sent to the Members, excluding the aforesaid
Annexure. In terms of Section 136 of the Companies Act, 2013 the said Annexure is open for
inspection. Any member interested in obtaining a copy of the same may write to the Company
Secretary.
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 relevant disclosure in terms of Rule 12 of Companies (Share capital and Debentures)
Rules, 2014 and Secretarial Standard on Report of the Board of Directors are given below :
Details of Movement of Employee Stock Options during the year:
| Sl. No |
Particulars |
ESOS 2021 PLAN A |
ESOS 2021 PLAN B |
| (a) |
Number of options granted during the year |
Nil |
Nil |
| (b) |
Number of options vested during the year |
Nil |
Nil |
| (c) |
Number of options exercised during the year |
Nil |
Nil |
| (d) |
Number of shares arising as a result of exercise of options |
Nil |
Nil |
| (e) |
Number of options lapsed during the year |
Nil |
Nil |
| (f) |
Exercise Price |
1/- |
30/- |
| (g) |
Variation of terms of options |
Nil |
Nil |
| (h) |
Money realized by exercise of options (INR), if scheme is implemented directly by the
Company |
Nil |
Nil |
| (i) |
Total Number of options in force (available for grant, but not yet granted) |
3,66,500 |
4,87,500 |
| (j) |
Employee-wise details of options granted to |
Nil |
Nil |
|
(i) Key Managerial Personnel |
Nil |
Nil |
|
(ii) Any other employee who receives a grant in any one year of option amounting to 5%
or more of option granted during that year |
Nil |
Nil |
|
(iii) Identified employees who were granted option, during any one year, equal to or
exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the
company at the time of grant |
Nil |
Nil |
The purpose of these plans are 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;
* Encourage eligible persons to align their performance with Company objectives;
* Reward Eligible persons to align their performance with Company objectives;
* Align interest of Eligible Persons with those of the organisation.
The Schemes are in compliance with the SEBI Regulations. During the year under review,
no material changes have been made in the schemes.
A Certificate from the Company's Statutory 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 and resolution passed by the Members of the
Company, has been received and same is attached as Annexure -10.
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 & PERSONNEL
Industrial relations continue to be cordial and harmonious at all the Units. Employees
at all levels are extending their fullest cooperation 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.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)
The details of key initiatives with respect to Stakeholder relationship, customer
relationship, environment, sustainability, health and safety are available in the BRSR for
the year 2023-24 which forms part of this 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. 2024-25 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 :
The due date for transfer of Unpaid Dividend for the financial year 2016-17 to Investor
Education Protection Fund is 02.09.2024. There is no other unpaid dividend amount
transferred to IEPF during the financial year 2023-2024.
Shares corresponding to the dividend for the financial year 2015-16 were transferred to
IEPF, as detailed below :
| No. of Shares |
Date of Transfer to IEPF |
| 6,868 |
06-04-2023 |
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 1/- each |
Amount of unclaimed / unpaid Dividend as on 31-03-2024 |
| 2016-17 |
Dividend |
04-08-2017 |
03-08-2024 |
02-09-2024 |
3,87,483 |
1,93,741.50 |
| 2017-18 |
Dividend |
03-08-2018 |
02-08-2025 |
01-09-2025 |
2,77,287 |
1,38,643.50 |
| 2018-19 |
Dividend |
08-08-2019 |
07-08-2026 |
06-09-2026 |
2,24,378 |
1,12,189.00 |
| 2019-20 |
Interim |
03-03-2020 |
02-03-2027 |
01-04-2027 |
3,52,498 |
1,76,249.00 |
|
Dividend |
|
|
|
|
|
| 2020-21 |
Dividend |
12-03-2021 |
11-03-2028 |
10-04-2028 |
2,32,431 |
2,32,431.00 |
| 2021-22 |
Dividend |
10-08-2022 |
09-08-2029 |
08-09-2029 |
3,99,189 |
3,99,189.00 |
| 2022-23 |
Dividend |
10-08-2023 |
09-08-2030 |
08-09-2030 |
2,14,585 |
2,14,585.00 |
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, 2024;
(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, 2024 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 respect of economical mix for manufacture
of fibre cement sheets, calcium silicate boards, fibre cement boards and non-asbestos
roofing sheets. Our Research and Development Laboratory has been accredited by National
Accreditation Board for Testing and Calibration Laboratories (NABL).
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.
|
On behalf of the Board of Directors |
|
For RAMCO INDUSTRIES LIMITED |
|
P.R. VENKETRAMA RAJA |
| Place : Chennai |
Chairman |
| Date : 28.05.2024 |
(DIN: 00331406) |