To
The Members,
The Directors are pleased to present the Thirty eight (38th)
Annual Report of the Company together with the audited financial statements (consolidated
and standalone) for the year ended 31st March 2024.
In compliance with the applicable provisions of Companies Act, 2013,
(including any statutory modification(s) or amendments thereof, for time being in force)
("Act") and the Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this report
covers the financial results and other developments during the financial year ended 31st
March, 2024, in respect of Craftsman Automation Limited.
1. FINANCIAL HIGHLIGHTS & STATE OF AFFAIRS:
1.1. The financial performance of the Company for the financial year
ended 31st March, 2024 is summarised below:
(C in Crores)
|
Year ended |
Year ended |
| Particulars |
31.03.2024 |
31.03.2023 |
31.03.2024 |
31.03.2023 |
|
Standalone |
Consolidated |
| Operatingrevenue |
3,20779 |
2,980.24 |
4,451.73 |
3,182.60 |
| Otherincome |
14.61 |
12.09 |
1724 |
12.54 |
| EBITDA |
656.17 |
671.33 |
896.92 |
696.63 |
| Less:FinanceCost |
154.62 |
116.91 |
174.54 |
120.23 |
| Less:DepreciationandAmortization |
236.05 |
214.97 |
27769 |
221.61 |
| ProfitbeforeTax(PBT) |
265.50 |
339.45 |
444.69 |
354.79 |
| Less:ProvisionforTax(Net) |
6791 |
101.69 |
10736 |
103.83 |
| ProfitafterTaxfortheyear(PAT) |
197.59 |
237.76 |
337.33 |
250.96 |
| OtherEquityopeningbalance |
1,360.82 |
1,131.64 |
1,42734 |
1,125.18 |
| Add:Profitfortheyear |
19759 |
23776 |
33733 |
250.96 |
| Add/(Less)OtherComprehensiveIncome/(Loss) |
0.78 |
-0.65 |
0.20 |
0.71 |
| Add:Onbusinesscombination |
0.00 |
0.00 |
0.00 |
58.42 |
| Dividendpaidonequityshares |
-23.77 |
-793 |
-23.77 |
-793 |
| OtherEquityclosingbalance |
1,535.42 |
1,360.82 |
1,741.10 |
1,42734 |
Standalone Financial Results:
During the Financial Year (FY) 2023-24, the Company has achieved
operating income of C320779 Crores as compared to C2980.24 Crores in FY 2022-23. The
profit before tax for FY 2023-24 stood at C265.50 Crores compared to C339.45 Crores
achieved in FY 2022-23. The profit after tax stood at C19759 Crores for FY 2023-24 as
compared to C23776 Crores for the previous year.
Consolidated Financial Results:
The Company's consolidated revenue for FY 2023-24 was C4451.73 Crores
as compared to C3182.60 Crores for the previous year. During the year under review, the
consolidated profit after tax stood at C33733 Crores as compared to C250.96 Crores for the
previous year.
The Consolidated Financial Statement includes Audited Financial
Statements of Craftsman Europe
B.V., Wholly Owned Subsidiary, DR Axion India Private Limited,
Subsidiary (w.e.f 1st February, 2023. Accordingly, 2 months Financial has been
consolidated for FY 2022-23) and Carl Stahl Craftsman Enterprises Private Limited, Joint
Venture.
2. DIVIDEND:
For the FY 2023-24, the Company has declared a Final Dividend of C11.25
on the equity shares of C5/- each with total outlay of C793 Lakhs.
The Board of Directors at their meeting held on 27th April,
2024 has recommended payment of C11.25 (Eleven Rupees and Twenty Five Paisa) per equity
share being 225% on the face value of C5 each as final dividend for the FY ended 31st
March, 2024. The payment of dividend is subject to approval of the shareholders at the 38th
Annual General Meeting ("AGM") of the Company. The dividend if approved by the
members would involve a cash outflow of C 2377 Lakhs. The dividend pay-out is in
accordance with the company's dividend distribution policy.
In view of the changes made under the Income Tax Act, 1961, by the
Finance Act, 2020, dividend paid or distributed by the Company shall be taxable in the
hands of the shareholders. Your Company shall, accordingly, make the payment of the
dividend after deduction of tax at source at appropriate rates applicable to resident and
non resident shareholders as the case may be.
Pursuant to provisions of Regulation 43A of the Listing Regulations as
amended from time to time, the Company has formulated Dividend Distribution Policy. The
policy is available on the Company's website at https://www.craftsmanautomation.com/
investors/wp-content/uploads/2022/08/14.CAL- Dividend-Distribution-Policy.pdf
3. TRANSFER OF UNCLAIMED DIVIDEND TO THE INVESTOR EDUCATION AND
PROTECTION FUND (IEPF):
In accordance with the provisions of Sections 124 and 125 of the Act
and Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules,
2016 ("IEPF Rules"), dividend of a Company which remain unpaid or unclaimed for
a period of seven years from the date of transfer to the Unpaid Dividend Account shall be
transferred by the Company to the Investor Education and Protection Fund
("IEPF").
In terms of the foregoing provisions of the Act, there is no dividend
which remains outstanding or remain to
be paid and required to be transferred to the IEPF by the Company
during the year ended 31st March, 2024.
4. SHARE CAPITAL:
During the year under review, the Company has not altered/modified its
authorised share capital and has not issued any shares including equity shares with
differential rights as to dividend, voting or otherwise. The Company has not issued any
sweat equity shares to its directors or employees and also has not made any buy back of
shares during the year under review.
The Paid-up Share Capital of the Company as on 31st March,
2024 is C10,56,41,555 divided into 2,11,28,311 Equity Shares of C5/- each fully paid up.
5. CHANGE IN REGISTERED OFFICE OF THE COMPANY
During the year, there were no change in the registered office of the
Company.
6. RESERVES AND SURPLUS:
The Company has not transferred any amount to the Reserves for the FY
ended 31st March, 2024.
7. MANAGEMENT DISCUSSION & ANALYSIS REPORT:
Pursuant to Regulation 34(2)(e) of the Listing Regulations, Management
Discussion and Analysis Report forms part of this report as Annexure - 1.
8. CORPORATE GOVERNANCE:
Pursuant to Regulation 34(3) of the Listing Regulations, a report on
Corporate Governance along with a Certificate from the Company Secretary in Practice
confirming the compliance of the provisions of Corporate Governance, forms an integral
part of this Annual Report and are given in Annexure - 2 and Annexure - 3 respectively.
9. CORPORATE SOCIAL RESPONSIBILITY (CSR):
In accordance with the requirements of Section 135 of the Act, , and
the Rules made there under, the Company has constituted a Corporate Social Responsibility
(CSR) Committee and also formulated a Corporate Social Responsibility Policy (CSR Policy)
which is available on the website of the Company at
https://www.craftsmanautomation.com/investors/
wp-content/uploads/2022/08/1.-CAL-Policy-on- Corporate-Social-Responsibility-1.pdf.
An Annual Report on CSR activities of the Company during the FY 2023-24
as required to be given under
Section 135 of the Act read with Rule 8 of the Companies (Corporate
Social Responsibility Policy) Rules, 2014 has been provided as an Annexure - 4 to
this Report.
10. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION
OF THE COMPANY:
There are no material changes and commitments affecting the financial
position of the Company which have occurred between the end of the FY ended 31st
March, 2024 to which the Financial Statements relates and the date of signing of this
report.
11. RISK MANAGEMENT POLICY:
Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of the
Listing Regulations, the Company has formulated and adopted a Risk Management Policy. The
Company has been consciously following a policy of risk mitigation by diversifying its
products, services, markets and customers. The key risk of exposure to the cyclicality of
automobile business is being mitigated by increasing the share of the Industrial &
Engineering segment. Further, within the Industrial & Engineering segment, the risk of
excessive reliance on contract manufacturing is being addressed by strengthening and
growing the Company's own product portfolio and creating brand equity.
Following are the major risk concerns:
Competition:
Some of the Company's business segments operates in a competitive
environment and some of the Company's customers pursue a policy of maintaining more than
one source for a product/ service. The Company's senior management team closely monitors
the market and devises the various strategies to stay ahead of the competition.
Economy:
The economy is still susceptible to the challenging global economic
environment of increased trade tensions, protectionism and slow down. It is also
constrained by fiscal profligacy and implementation delays, weak financial sector.
Automobile Industry:
The fortunes of the automobile industry are cyclical and the demand for
vehicles are vulnerable to the interest rates and liquidity.
Risk Mitigation Measures:
As already mentioned the Company adopts the policy of risk
diversification by broadening its products,
services, market and customer base. The Company over the years built a
good design, engineering and product development team. This has enabled the Company to
come out with new products and services and in the contract manufacturing space, the
company is able to position itself as a one-stop solution provider to its customers. In
addition, the Company has steadily invested over the years to build up world class
manufacturing and testing facilities at Coimbatore and other plants. The state-of-the-art
machines, continuous improvement in the production processes, constant upgradation of
employee skill levels, backward integration to tool, die and fixture making and JIT
deliveries have created a strong competitive advantage for the Company.
The Board has constituted Risk Management Committee under the
Chairmanship of Mr. Srinivasan Ravi, which reviews the various risks faced by the Company
and advises the Board on risk mitigation plans. Risk Management policy may be accessed on
the Company's website at the link: https://www.craftsmanautomation.com/investors/
wp-content/uploads/2022/08/4.-CAL-Risk- Management-Policy.pdf
12. VIGIL MECHANISM / WHISTLE BLOWER POLICY FOR DIRECTORS AND
EMPLOYEES:
The Company has formulated a comprehensive Whistle Blower Policy in
line with the provisions of Section 177(9) and 177(10) of the Act and Regulation 22 of the
Listing Regulations with a will to enable the stakeholders, including directors,
individual employees to freely communicate their concerns about illegal or unethical
practices and to report genuine concerns to the Audit Committee of the Company .
The mechanism provides adequate safeguards against victimization of
directors or employees who avail of the mechanism. The Whistle Blower Policy has been
placed in the website of the Company at https://www.craftsmanautomation.com/
investors/wp-content/uploads/2022/08/2.-CAL- WhistleBlowerPolicy.pdf
13. INFORMATION REQUIRED UNDER SEXUAL HARASSMENT OF WOMEN AT WORK PLACE
(PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013:
The Company has in place a policy on prevention, prohibition and
redressal of Sexual Harassment at workplace in line with the requirements of The Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The
Internal Committee has been setup to redress the complaints
received on the sexual harassment. All employees of the Company are
covered under this policy.
The details of complaints received and disposed off during the FY
2023-24 is as follows:
| Sl. No.. |
Particulars |
Remarks |
| (a) |
Number of complaints of
sexual harassment received in the year |
Nil |
| (b) |
Number of complaints disposed
off during the year |
Nil |
| (c) |
Number of cases pending for
more than ninety days |
Nil |
| (d) |
Number of workshops or awareness
programme against sexual harassment carried out |
2 |
| (e) |
Nature of action taken by the
employer or District Officer |
Nil |
14. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
During FY 2023-24, all contracts/ arrangements/ transactions entered
into by the Company with related parties were in the ordinary course of business and on an
arm's length basis. All the Related Party Transactions are placed before the Audit
Committee for prior approval, as required under the Act and Listing regulations. A
statement of all Related Party Transactions is placed before the Audit Committee for its
review on a quarterly basis.
The Company has not entered into material contracts or arrangements or
transactions with related parties in accordance with Section 188 of the Act read with the
Companies (Meetings of Board and its Powers) Rules, 2014. There were no materially
significant Related Party Transactions made by the Company during the year that would have
required shareholders' approval under the Listing Regulations.
Accordingly, the disclosure of related party transactions as required
under Section 134(3)(h) of the Companies Act, 2013, in Form AOC-2 is not applicable.
Members may refer to Note no. 3.5 to the Standalone Financial Statements which sets out
related party disclosures pursuant to IND AS-24.
The Company has adopted policy on Related Party Transactions and can be
accessed on the Company's website at https://www.craftsmanautomation.com/
investors/wp-content/uploads/2022/08/11 .-CAL- RPT-Policy.pdf.
15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
OF THE ACT:
Pursuant to Section 186 of the Act, disclosure on particulars relating
to loans, advances, guarantees and investments are provided as part of the
financial statements in notes to the Standalone Financial Statements.
16. DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE
INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016) DURING THE FINANCIAL YEAR:
No application was made or any proceeding pending under the Insolvency
and Bankruptcy Code, 2016 (31 of 2016) during the FY 2023-24.
17. DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE
TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR
FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF DURING THE FINANCIAL YEAR:
No onetime settlement was done with any Bank / Financial Institutions
during the financial year under review.
18. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
OR TRIBUNALS:
There were no significant / material orders passed by the regulators or
courts or tribunals during the FY 2023-24, impacting the going concern status and
Company's operations in future.
19. ANNUAL RETURN:
Pursuant to Section 92(3) and 134(3)(a) of the Act the Annual Return of
the Company prepared in accordance with Section 92(1) of the Act read with Rule 11 of the
Companies (Management and Administration) Rules, 2014 (as amended), is placed on the
website of the Company and is accessible at the web-link
https://www.craftsmanautomation.com/ investors/annual-reports/.
20. CREDIT RATING:
During the year under review, CRISIL Limited, a credit rating agency
registered with the Securities and Exchange Board of India has upgraded the credit rating
assigned to the long term loan facilities from A+/Positive to AA-/Stable and for the short
term loan facilities from rating A1 to A1+ vide letter dated 20th July, 2023.
21. DEPOSITS:
The Company has not accepted any deposits falling within the meaning of
Section 73 or 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014
during the FY and as such, no amount on account of principal or interest on deposits from
public was outstanding as on 31st March, 2024.
22. AWARDS AND RECOGNITIONS:
The Company has always been singled out by its customers as a supplier
partners known for its reliability and quality.
During the year, the Company has received the following awards:
1. Annual Supplier Conference - "Ability Going Extra Mile -
2023" from TATA Motors
2. Appreciation Award for the service towards construction of Aurolab
Warehouse - 2023 from Aurolab Warehouse
3. Annual Commodity Award - Casting and Forging and Special
Appreciation Award- Scorpio-N from Mahindra & Mahindra
23. SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE:
23.1 Details of Foreign wholly owned subsidiary:
CRAFTSMAN EUROPE B.V., THE NETHERLANDS
During the year under review, Craftsman Europe B.V., Wholly Owned
Subsidiary has posted a turnover of C20.00 Crores (€ 22.27 Lakhs) as against C21.59
Crores (€ 25.70 Lakhs) in the previous year. The profit for the FY2023-24 amounted to
C2.16 Crores as compared to C2.38 Crores for the previous year.
23.2 Details of Subsidiary:
DR AXION INDIA PRIVATE LIMITED:
During the year under review, DR Axion India Private Limited,
Subsidiary of Craftsman Automation Limited has posted a turnover of C1246.15 Crores as
against C1084.09 Crores in the previous year. The profit for the FY2023-24 amounted to
C136.89 Crores as compared to C58.36 Crores for the previous year. DR Axion India Private
Limited was acquired w.e.f 1st February, 2023. Accordingly, 2 months Financial
has been consolidated for FY 2022-23.
23.3 Details of Joint Venture Company:
CARL STAHL CRAFTSMAN ENTERPRISES PRIVATE LIMITED:
Carl Stahl Craftsman Enterprises Private Limited which is an associate
Company in which your Company is holding 30% of equity shares notched a turnover of C76.72
Crores in FY 2023-24 as against the C48.97 Crores of FY 2022-23. The Profit for the year
was C 2.82 Crores as against profit of C1.60 Crores in FY 2022-23.
Pursuant to Section 129(3) of the Act read with Rule 5 of the Companies
(Accounts) Rules, 2014, a statement
containing salient features of the financial statements of the
Company's Subsidiaries and Associate Company in Form No. AOC-1 is attached to this report
as Annexure - 5.
24. CHANGE IN NATURE OF BUSINESS:
During the year under review, there has been no change in the Company's
nature of business.
25. DIRECTORS:
The Board of the Company is duly constituted. None of the directors of
the Company is disqualified under the provisions of the Act or the Listing Regulations.
The Board at its meeting held on 6th March, 2023 had
appointed Mrs. Rajeswari Karthigeyan (DIN: 07148250) as an Additional Director in the
category of Independent Director of the Company with effect from 6th March,
2023 upon recommendation of the Nomination and Remuneration Committee. Further, the
shareholders of the Company had approved the appointment of Mrs. Rajeswari Karthigeyan
(DIN: 07148250) as an Independent Director w.e.f 6th March, 2023 through Postal
Ballot on 13th April, 2023 with requisite majority.
The Shareholders of the Company had approved the reappointment of Mrs.
Vijaya Sampath (DIN:00641110) as an Independent Director for the second term w.e.f 30th
April, 2023 and reappointment of Mr. Sundararaman Kalyanaraman (DIN:01252878) as an
Independent Director for the second term w.e.f 24th May, 2023 and also approved
the continuation of Directorship of Mr. Sundararaman Kalyanaraman (DIN: 01252878) as an
Independent Director from the day he attains the age of 75 years till the expiry of his
second term through Postal Ballot on 13th April, 2023 with requisite majority.
During the FY 2023-24, Mr. Chandrasekar Madhukar Bhide, ceased to be an
Independent Director of the Company w.e.f 23rd May, 2023 upon completion of his
tenure.
In accordance with the provisions of the Act and Articles of
Association of the Company, Mr. Srinivasan Ravi (DIN: 01257716), Chairman and Managing
Director, retires by rotation and being eligible, offers himself for reappointment at the
ensuing AGM. His appointment is placed for approval of the members and forms part of the
notice of the 38th AGM. The information about the Director seeking his
reappointment as per Para 1.2.5 of Secretarial Standards on General Meetings and
Regulation 36(3) of the Listing Regulations has been given in the notice convening the 38th
AGM.
26. KEY MANAGERIAL PERSONNEL:
Pursuant to Section 2(51) and 203 of the Act read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following are the
Key Managerial Personnel of the Company:
i. Mr. Srinivasan Ravi, Chairman and Managing Director;
ii. Mr. Ravi Gauthamram, Whole Time Director;
iii. Mr. C.B.Chandrasekar, Chief Financial Officer;
iv. Mr. Thiyagaraj Damodharaswamy, Chief Operating Officer - Automotive
Powertrain;
v. Mr. Shainshad Aduvanni, Company Secretary.
The remuneration and other details of these Key Managerial Personnel
for FY 2023-24 are provided in the Annual Return which is available on the website of the
Company.
27. COMMITTEES:
As per the requirements of the Act and Listing Regulations, the
following committees were constituted and the composition, meeting of committees held
during the year are as follows.
i. Audit Committee:
The Composition of the Audit Committee:
1. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director
(Chairman);
2. Mr. Sundararaman Kalyanaraman, Independent Director (Member);
3. Mrs. Vijaya Sampath, Independent Director (Member);
4. Mrs. Rajeswari karthigeyan, Independent Director (Member).
During the FY 2023-24, Mr. Chandrasekar Madhukar Bhide, ceased to be an
Independent Director w.e.f 23rd May, 2023 and the Chairman of the Audit
Committee of the Company w.e.f 8th May, 2023 upon completion of his tenure.
Hence the Audit Committee was reconstituted as above w.e.f 8th May, 2023.
During the FY 2023-24, the Audit Committee met four times on 8th
May, 2023, 24th July, 2023, 30th October, 2023 and 27th
January, 2024.
ii. Nomination and Remuneration Committee:
The Composition of the Nomination and Remuneration Committee:
1. Mrs. Vijaya Sampath, Independent Director (Chairperson);
2. Mr. Sundararaman Kalyanaraman, Independent Director (Member);
3. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director
(Member).
During the FY 2023-24, Mr. Chandrasekar Madhukar Bhide, ceased to be an
Independent Director w.e.f 23rd May, 2023 and member of the Nomination and
Remuneration Committee of the Company w.e.f 8th May, 2023 upon completion of
his tenure. Hence the Nomination and Remuneration Committee was reconstituted as above
w.e.f 8th May, 2023.
During the FY 2023-24, Nomination and Remuneration Committee met three
times on 8th May, 2023, 24th July, 2023 and 27th January,
2024.
iii. Stakeholders Relationship Committee:
The Composition of the Stakeholders Relationship Committee:
1. Mr. Sundararaman Kalyanaraman, Independent Director (Chairman);
2. Mr. Srinivasan Ravi, Chairman and Managing Director (Member);
3. Mrs. Rajeswari karthigeyan, Independent Director (Member).
During the FY 2023-24, Mr. Chandrasekar Madhukar Bhide, ceased to be an
Independent Director w.e.f 23rd May, 2023 and the Chairman of the Stakeholders
Relationship Committee of the Company w.e.f 8th May, 2023 upon completion of
his tenure. Hence the Stakeholders Relationship Committee was reconstituted as above w.e.f
8th May, 2023.
During the financial year 2023-24, Stakeholders Relationship Committee
met once on 27th January, 2024.
iv. CSR Committee:
The composition of CSR Committee:
1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);
2. Mr. Tamraparni Srinivasan Venkata Rajagopal, Independent Director
(Member);
3. Mrs. Vijaya Sampath, Independent Director (Member).
During the FY 2023-24, the CSR Committee met two times on 8th
May, 2023 and 27th January, 2024.
v. Risk Management Committee:
The composition of Risk Management Committee:
1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);
2. Mr. Ravi Gauthamram, Whole Time Director (Member);
3. Mr. Sundararaman Kalyanaraman,
Independent Director (Member);
2
4. Mr.C.B.Chandrasekar, Chief Financial Officer (Member);
During the FY 2023-24, the Risk Management Committee met two times on
25th August, 2023 and 9th February, 2024.
vi. Management Committee:
The Composition of the Management Committee:
1. Mr. Srinivasan Ravi, Chairman and Managing Director (Chairman);
2. Mr. Ravi Gauthamram, Whole Time Director (Member).
During the FY 2023-24, the Management Committee met once on 19th
May, 2023.
28. INTERNAL FINANCIAL CONTROLS:
A. Internal Financial Controls and their Adequacy
In terms of Section 134(5)(e) of the Act, the term Internal Financial
Control means the policies and procedures adopted by a Company for ensuring orderly and
efficient conduct of its business, including adherence to Company's policies, safeguarding
of its assets, prevention and detection of frauds and errors, accuracy and completeness of
the accounting records, and timely preparation of reliable financial information.
Internal Control Over Financial Reporting (ICFR) remains an important
component to foster confidence in a company's financial reporting, and ultimately,
streamlining the process to adopt best practices. Your Company through Internal Audit
Program is regularly conducting test of effectiveness of various controls. The ineffective
and unsatisfactory controls are reviewed and remedial actions are taken immediately. The
internal audit plan is also aligned to the business objectives of the Company which is
reviewed and approved by the Audit Committee. Further, the Audit Committee monitors the
adequacy and effectiveness of your Company's internal control framework.
Adequate internal financial controls are in place which ensures the
reliability of financial and operational information. The regulatory and statutory
compliances are also ensured. The Oracle enterprise wide resource platform deployed in the
Company enables the business processes and also ensures financial discipline and fosters
accountability.
29. AUDITORS & AUDITORS REPORT:
A. Statutory Auditors
The Shareholders at their meeting held on 20th May, 2020 had
appointed Sharp & Tannan, Chartered Accountants, A-Wing, 602, Anna Salai, Chennai -
600 006 (Firm Registration No:003792S), as the Statutory Auditors of the Company for a
period of 5 years from the conclusion of the 34th AGM (2020) till the
conclusion of 39th AGM (2025).
B. Statutory Audit Report
There are no qualifications, reservations or adverse remarks made by
Sharp & Tannan, Statutory Auditors in their report for the FY ended 31st
March, 2024.
C. Internal Auditor
MC Ranganathan & Co., Chartered Accountants, Chennai, who are the
Internal Auditors have carried out internal audit for the FY 2023-24. Their reports were
reviewed by the Audit Committee.
D. Cost Auditor
During the FY 2023-24, the Company is required to maintain cost records
under Companies (Cost Records and Audit) Rules, 2014. Accordingly, cost records have been
maintained by the Company, which are being audited by S.Mahadevan & Co, Cost
Accountants, Coimbatore (Registration No. 000007).
In accordance with Section 148 of the Act, the Board of Directors of
the Company, on recommendation of the Audit Committee, has reappointed S.Mahadevan &
Co, Cost Accountants, Coimbatore, (Registration No. 000007) as the Cost Auditors to
conduct the Audit of the Cost Accounting Records maintained by the Company for the FY
2024-25. S.Mahadevan & Co have confirmed that their appointment is within the limits
of Section 141 (3)(g) of the Act and have also certified that they are free from any
disqualifications specified under Section 141(3) read with Section 148(5) of the Act.
As per the provisions of the Act, a resolution seeking members'
ratification for the remuneration payable to S. Mahadevan & Co, Cost Auditors for the
year 2024-25 is included at item no.4 of the Notice convening the 38th AGM.
E. Secretarial Auditor and Secretarial Audit:
Pursuant to the Section 204 of the Act read with the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors
had appointed KSR & Co Company Secretaries LLP Coimbatore as the Secretarial Auditors
of the Company to undertake the Secretarial Audit of the Company for the FY 2023-24.
The Secretarial Audit Report in form MR-3 forms part of the Directors'
Report as Annexure - 6.1. The report does not contain any qualification,
reservation, adverse remark or disclaimer.
The Secretarial Audit Report of DR Axion India Private Limited,
Subsidiary in form MR-3 is attached to this report as Annexure - 6.2. The
Secretarial Audit Report of DR Axion India Private Limited does not contain any
qualification, reservation, adverse remark or disclaimer.
F. Annual Secretarial Compliance Report
The Company has undertaken an audit for the FY ended 31st
March, 2024 for all applicable compliances as per the Regulation 24A of the Listing
Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance
Report to be issued by KSR & Co Company Secretaries LLP will be submitted to the Stock
Exchanges as per the Listing regulations.
G. Reporting of Frauds by Auditors:
During the year under review, the Statutory Auditors, Internal
Auditors, Cost Auditors and Secretarial Auditors have not reported any instance of fraud
committed in the Company by its Officers or Employees to the Audit Committee under Section
143(12) of the Act and the rules made thereunder.
30. MEETINGS OF THE BOARD AND COMMITTEES:
During the FY 2023-24, the Board of Directors met five (5) times and
the details of the meetings of the Board and its Committees are given in the Corporate
Governance Report (Annexure - 2). The gap intervening between two meetings was
within the time prescribed under the Act and Listing Regulations.
Details of attendance of meetings of the Board, its Committees and the
Annual General Meeting/ Postal Ballot are included in the Report on Corporate Governance,
which forms part of this Annual Report.
31. MEETING OF INDEPENDENT DIRECTORS:
In terms of requirements under Schedule IV of the Act and Regulation 25
(3) of Listing Regulations, a separate meeting of the Independent Directors was held on 29th
October, 2023 and 25th March, 2024.
The Independent Directors at the meeting, inter alia, reviewed the
following: -
• Performance of Non-Independent Directors and Board as a whole.
• Performance of the Chairman of the Company, taking into account
the views of Executive Directors and Non-Executive Directors.
• Assessed the quality, quantity and timeliness of flow of
information between the Company Management and the Board that is necessary for the Board
to effectively and reasonably perform their duties.
32. DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received declarations from each Independent Director of
the Company under Section 149(7) of the Act and Regulation 25(8) of the Listing
Regulations confirming compliance with the criteria of independence as stipulated under
Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and there has
been no change in the circumstances which may affect their status as Independent Directors
during the FY 2023-24.
All Independent Directors of the Company have affirmed compliance with
the Schedule IV of the Act and Company's Code of Conduct for Directors and Employees for
the FY 2023-24.
All the Independent Directors of the Company have registered themselves
with the Indian Institute of Corporate Affairs ('IICA') towards the inclusion of their
names in the data bank and they meet the requirements of proficiency self-assessment test.
33. NON-EXECUTIVE DIRECTORS' COMPENSATION AND DISCLOSURES:
None of the Independent / Non- Executive Directors have any pecuniary
relationship or transactions with the Company which in the judgement of the Board may
affect the independence of the Directors.
34. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The Company has adopted a familiarisation programme for Independent
Directors with an objective of making the Independent Directors of the Company accustomed
with the business and operations of the Company through various structured orientation
programme. The familiarization programme also intends to update the Directors on a regular
basis on any significant changes therein so as to be in a position to take well informed
and timely decision.
The details of the familiarization programme undertaken have been
uploaded on the Company's website and the same is accessible at the web-link
https://www.craftsmanautomation.com/investors/
wp-content/uploads/2024/04/Details-of-Familiarisation- Programme_2023-24.pdf
35. PERFORMANCE EVALUATION OF BOARD AND ITS COMMITTEES:
Pursuant to the provisions of the Act and Listing Regulations and as
per Guidance Note on Board Evaluation issued by SEBI on 5th January, 2017 the
Board has carried out annual performance evaluation of its own performance, the Directors
individually as well as evaluation of the working of its Committees at its meeting held on
27th January, 2024.
The Nomination and Remuneration Committee has defined the evaluation
criteria for the performance evaluation of individual Directors, the Board and its
Committees. The performance of the Board, its committees and individual Directors was
evaluated by the Board after seeking inputs from all the respective Committee members and
Directors.
36. DIRECTORS' APPOINTMENT AND REMUNERATION POLICY:
The Company has on the recommendation of the Nomination &
Remuneration Committee framed and adopted a Nomination and Remuneration Policy in terms of
the Section 178 of the Act with effect from 02nd July, 2018. The policy, inter
alia lays down the principles relating to appointment, cessation, remuneration and
evaluation of directors, Key Managerial Personnel and Senior Management Personnel of the
Company.
The Nomination & Remuneration Policy of the Company is available on
the website of the Company at web-link https://www.craftsmanautomation.com/investors/
wp-content/uploads/2022/08/3.-CAL-Nomination-
Remuneration-and-Board-Evaluation-Policy.pdf.
37. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:
The details as required under Section 197(12) of the Act and Rule 5(1)
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are
given in Annexure - 7 of this Report.
In terms of provisions of Section 197(12) of the Companies Act, 2013
and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, a statement showing names of the employees drawing remuneration and other
particulars, as prescribed in the said Rules forms part of this report. However, in terms
of first proviso to Section 136(1) of the Act, the Annual Report, excluding the aforesaid
information, is being sent to the members of the Company. The said information is
available for inspection at the Registered Office of the Company during working hours and
any member who is interested in obtaining these particulars may write to the Company
Secretary of the Company.
During the year, the Company had no employee who was employed
throughout the FY or part thereof and was in receipt of remuneration, which in the
aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that
drawn by the Managing Director or Whole-Time Director or Manager and holds by himself or
along with his spouse and dependent children, not less than 2% of the equity shares of the
Company.
38. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the
initiatives taken by the Company from an environmental, social and governance perspective
for the FY 2023-24 has been given in the Business Responsibility and Sustainability Report
(BRSR) as per the format specified by SEBI Circular no.
SEBI/HO/CFD/CFD-SEC-2/P/CIR/2023/122 dated 12th July, 2023 which forms part of
this report as Annexure - 8. The Company's ESG profile can be accessed through
https://www.craftsmanautomation. com/esg-profile.html .
39. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO:
The information pertaining to details of conservation of energy,
technology absorption, foreign exchange earnings and outgo as required under Section
134(3)
(m) of the Act read with Rule 8 of the Companies Accounts Rules, 2014
are as follows:
A. Conservation of energy:
I. Steps taken or impact on
conservation of energy
a. Old Compressor motors were replaced with New High Efficient Motors
in Screw Compressor.
b. The Company is replacing low Efficient Screw Air Compressor with new
High Capacity and Efficient Air Compressors, which results in energy saving and reducing
no of compressors.
c. The Existing LED lamps with High Coverage and High Efficient LED
lamps has be replaced, due to which number of Fittings are reduced.
d. 3 different capacity STP converted into one single capacity STP
e. 90% of stabilizers were removed from the system by installing
standby capacity UPS system.
f. Screw Compressors were shifted to new high ventilated rooms as a
result, Efficiency has improved.
g. The Company is under process of using LNG instead of LPG for Melting
Furnaces and PNG DG sets instead of Diesel Generator Set
II. Steps taken by the Company for utilizing
alternate source of energy
a. The Company is planning to purchase more volume of power from Third
Party Wind and solar Energy.
b. In Company's unit 3 plant located at Arasur, the Company has
converted the incoming Government EB Power from 33KV HT Supply to 110Kv EHT Supply for
uninterrupted quality power due to which the direct and indirect energy savings are more.
c. The Company has installed Solar Roof top plant
III. Capital investment on energy conservation equipment's
a. Solar Roof Top Plant
b. HT to EHT Conversion Power Project
c. PNG Generator sets (Piped Natural Gas)
B. Technology Absorption:
The Company has effectively integrated and absorbed general technology
in the area of UPS Cooling System, Generator by ordering PNG Generator sets instead of
Diesel Generator sets and power consumption from 800Kw Roof Top Solar Power Plant.
The expenditure incurred on Research and Development.
The Company has not incurred any expenditure on Research and
Development.
C. Foreign Exchange earnings and Outgo:
Details of earnings accrued and expenditure incurred in foreign
currency are as given below.
Foreign Exchange Earnings --- C205.54 Crores Foreign Exchange Outgo ---
C365.42 Crores
40. DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors' Responsibility Statement referred to in Section 134 (3)
(c) of the Act shall state that:
a. in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to material departures;
b. the directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company at the end of the FY and
profit of the Company for that period;
c. the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the provisions of the Act
for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities;
d. the directors had prepared the annual accounts on a going concern
basis;
e. the directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were adequate and operating
effectively.
41. SECRETARIAL STANDARDS:
The Company is in compliance with the Secretarial Standards on Meetings
of Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of
Company Secretaries of India.
42. PROHIBITION OF INSIDER TRADING:
In terms of the provisions of the Securities and Exchange Board of
India (Prohibition of Insider Trading) Regulations, 2015, as amended (PIT Regulations),
the Company has adopted the revised "Code of Conduct to Regulate, Monitor and Report
Trading by Insiders" ("the Code"). The Code is applicable to all Directors,
Designated persons and connected Persons and their immediate relatives, who have access to
unpublished price sensitive information relating to the Company.
The Company has also formulated a 'Code of Practices and Procedures for
Fair Disclosure of Unpublished Price Sensitive Information (UPSI)' in compliance with the
PIT Regulations.
The aforesaid Codes are posted on the Company's
website and can be accessed by using web link at
https://www.craftsmanautomation.com/investors/
wp-content/uploads/2022/08/6.-CAL-Code-of-
Conduct-under-SEBI-PITpdf
and
https://www.craftsmanautomation.com/investors/
wp-content/uploads/2022/08/7-CAL-Code-of-Fair-
Disclosure-of-UPSI.pdf
43. STATEMENT REGARDING OPINION OF THE BOARD WITH REGARD TO INTEGRITY,
EXPERTISE AND EXPERIENCE (INCLUDING THE PROFICIENCY) OF THE INDEPENDENT DIRECTORS
APPOINTED DURING THE YEAR:
In the opinion of Board of Directors of the Company, Independent
Directors on the Board of Company hold highest standards of integrity and are highly
qualified, recognized and respected individuals in their respective fields. It's an
optimum mix of expertise (including financial expertise), leadership and professionalism.
44. CEO/CFO CERTIFICATION
As required under Regulation 17(8) of the Listing Regulations, the
Managing Director and CFO of the
Company have certified the accuracy of the Financial Statements and
adequacy of Internal Control Systems for financial reporting for the year ended 31st
March, 2024. The certificate is given in Annexure - 9.
45. DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR
MANAGEMENT PERSONNEL WITH THE COMPANY'S CODE OF CONDUCT:
The Code of Conduct of the Company aims at ensuring consistent
standards of conduct and ethical business practices across the Company. This Code is
available on the website of the Company at weblink https://www.craftsmanautomation.com/
investors/wp-content/uploads/2022/08/10.-CAL- Code-of-Conduct-for-Directors-and-SM.pdf.
Pursuant to the Listing Regulations, a confirmation from the Managing Director regarding
compliance with the Code by all the Directors and senior management of the Company is
given in Annexure - 10.
46. CAUTIONARY STATEMENT:
The Annual Report including those which relate to the Directors'
Report, Management Discussion and Analysis Report may contain certain statements on the
Company's intent expectations or forecasts that appear to be forward-looking within the
meaning of applicable securities laws and regulations while actual outcomes may differ
materially from what is expressed herein. The Company bears no obligations to update any
such forward looking statement. Some of the factors that could affect the Company's
performance could be the demand and supply for Company's product and services, changes in
Government regulations, tax laws, forex volatility etc.
47. ACKNOWLEDGEMENTS:
The Directors take this opportunity to thank the shareholders, bankers
and the financial institutions for their cooperation and support to the operations and
look forward for their continued support in future. The Directors also thank all the
customers, vendor partners, and other business associates for their continued support
during the year. The Directors place on record their appreciation for the hard work put in
by all employees of the Company.
For and on behalf of the Board of Directors
|
Srinivasan Ravi |
| Coimbatore |
Chairman and Managing
Director |
| 27th April, 2024 |
DIN:01257716 |
|