MUKAND SUMI METAL PROCESSING LIMITED

Transcription

1 MUKAND SUMI METAL PROCESSING LIMITED CIN: U27300MH2012PLC th ANNUAL REPORT Board of Directors Mr. Rajesh V. Shah -- Chairman Mr. Arvind M. Kulkarni Mr. Vipul M. Mashruwala Ms. Anna Abraham Mr. Kenji Setogawa Mr. Masaki Sasamoto Mr. Kosuke Okamoto -- w.e.f. 16 th May, 2016 Mr. N. C. Sharma Mr. R. Sankaran Key Managerial Personnel Mr. Arvind M. Kulkarni - Chief Executive Officer - w.e.f. 21 st September, 2016 Mr. Shingo Mizuho - Chief Financial Officer Mr. K. J. Mallya - Company Secretary Auditors M/s. Haribhakti & Co., LLP Chartered Accountants Registered Office: Bajaj Bhavan, 3 rd Floor, Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai Tel: Fax: muksumi@mukand.com Project Office: Building No. 65, Thane Belapur Road, Village Dighe, Kalwe, Thane Tel: Fax:

2 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) Directors Report Dear Members, Your Directors take pleasure in presenting the Fifth Annual Report on the business and operations of the Company along with the audited financial statements for the financial year ended 31 st March Financial Results The financial performance of the Company, for the financial year ended 31 st March, 2017 is summarised below: Particulars 1. in Million Total Income Earnings before Interest, Depreciation & Tax Profit/(Loss) Before Taxation Profit / (Loss) After Taxation Earnings Per Share (.) Review of Operations During the financial year under review, sales was.4,489 Million compared to.5,130 Million in the previous year, i.e., a decrease of 12.49%. The decrease in sales was lower due to reduction in selling price. In Quantitative terms, sales were 56,385 MT compared to 59,521 MT in the previous year, i.e. a decrease of 5.30%. 3. Outlook for Financial Year The Company has already procured a state of the art Wire Drawing Machine fitted with online Eddy Current Tester and a Combined Drawing line. These machines will widen the product range in Bright Bars and Wires, reduce manufacturing costs and also develop import substitute products, for automobile companies. The Company plans to increase the sales both in terms of new products and by exploring new market segments. 4. Subsidiaries/ Associates / Joint Venture The Company does not have any subsidiaries, associates and joint ventures.

3 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) 5. Dividend The Directors have recommended a dividend of Re. 1/- (Previous year Nil) per equity share, net of Dividend Distribution Tax (DDT), for the year ended 31 st March, Finance During the year under review, the fund based and non-fund based limits availed by the Company has been reduced to Million from Million in previous year. 7. Transfer to Reserves No amount has been transferred to Reserves during the year under review. 8. Material Changes and Commitments There have been no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of the financial year of the Company and the date of this report. 9. Share Capital The paid up Equity Share Capital of the Company was. 273 Million as on 31 st March 2017 which is same as in the previous year as on 31 st March During the period under review, the Company had executed a Tripartite Agreement with National Securities Depository Limited ( NSDL ) and Bigshare Services Pvt. Ltd. for admission of its equity shares for conversion from physical form into dematerialized form. The Equity shares of the Company have been admitted for dematerialization with NSDL with an active ISIN: INE058X Deposits The Company has not accepted or renewed any amount falling within the purview of provisions of Section 73 of the Companies Act 2013 ( the Act ) read with the Companies (Acceptance of Deposit) Rules, 2014 during the year under review. 11. Particulars of Loans, Guarantees and Investments The Company has neither given any loans/guarantees to any other entities during the financial year. The company during the year under review invested crore in various mutual fund scheme/s. 12. Related Party Transactions There were no related party transactions entered into by the Company during the financial year which attracted the provisions of Section 188 of the Companies Act, 2013 as all related party transactions that were entered into by the Company during the year were on an arm s length basis and were in the 2

4 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) ordinary course of the Company's business. Hence there are no transactions which are required to be disclosed in Form AOC Director s Responsibility Statement Pursuant to clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Board of Directors of the Company hereby state and confirm that: i. in the preparation of the annual accounts, the applicable accounting standards have been followed and no material departures have been made therefrom; ii. the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the financial year ended as at 31 st March, 2017 and of the profit of the Company for the said period; iii. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv. the directors have prepared the annual accounts on a going concern basis; v. the Company being an unlisted public company, is not required to lay down internal financial controls to be followed by the Company; and vi. the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. 14. Extract of Annual Return The extract of the Annual Return as provided under sub-section (3) of Section 92 of the Companies Act, 2013, in the prescribed Form MGT- 9 is annexed to this report as Annexure A. 15. Board of Directors & Key Managerial Personnel A. Board of Directors: The Board of Directors of the Company consisted of Nine directors, of whom two were non-executive independent, six were non-executive and nonindependent (including one woman director) and One is executive, as per details given in the table below. The Company has a non-executive Chairman. 3

5 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) Sr. No. Name of the Director Category 1 Mr. Rajesh V. Shah Chairman, Non Executive 2 Mr. Arvind M. Kulkarni Executive 3 Mr. Vipul M. Mashruwala Non Executive 4 Ms. Anna Abraham Non Executive 5 Mr. Kenji Setogawa Non Executive 6 Mr. Masaki Sasamoto Non Executive 7 Mr. Kosuke Okamoto Non Executive 8 Mr. N. C. Sharma Non Executive & Independent 9 Mr. R. Sankaran Non Executive & Independent During the year under review, Mr. Kosuke Okamoto was appointed as Additional Director of the Company in the category Non-Executive Director at the meeting of the Board of Directors held on 16 th May, 2016 and subsequently was appointed as a Director by the shareholders at the Fourth Annual General Meeting of the Company held on 8 th September, Mr. Rajesh V. Shah, Chairman Non Executive, Mr. Vipul M. Mashruwala, Non Executive Director and Ms. Anna Abraham, Non-Executive Director of the Company, retire by rotation and being eligible offer themselves for reappointment. The Board recommends their reappointment. B. Key Managerial Personnel: During the year under review, Mr. Arvind M. Kulkarni ceased to be Manager w.e.f. 20 th September, 2016 due to conclusion of the tenure as per terms of his appointment as a Manager. Thereafter, he was appointed / re-designated as Chief Executive Officer w.e.f. 21 st September, Mr. Arvind M. Kulkarni, Chief Executive Officer and Mr. K. J. Mallya, Company Secretary of the Company are employees of Mukand Limited, the holding company and are deputed as Key Managerial Personnel of the Company and no remuneration is drawn by them separately from the Company. Mr. Shingo Mizuho is the Chief Financial Officer of the Company and the remuneration drawn by him from the Company is disclosed in Form MGT-9 as per Annexure A. None of the Directors draws any remuneration from the Company, except that Independent Directors are paid sitting fees of. 20,000/- per Board meeting and. 10,000/- per Committee meeting and meeting of Independent Directors attended by them. 16. Declaration of Independence The Independent Directors of the Company have submitted their Declaration of Independence, as required under the provisions of Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in Section 149(6) of the said Act. 4

6 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) 17. Board Meetings The Board of Directors of the Company met four times during the year under review on 16/05/2016, 08/09/2016, 10/11/2016 and 14/02/2017. The particulars of attendance of the Board of Directors at the said meetings are provided in the table below. Name of Director Number of Board Meetings held during the year 5 Number of Board Meetings attended during the year Mr. Rajesh V. Shah 4 4 Mr. Arvind M. Kulkarni 4 4 Mr. Vipul M. Mashruwala 4 4 Ms. Anna Abraham 4 4 Mr. Kenji Setogawa 4 4 Mr. Masaki Sasamoto 4 3 Mr. Kosuke Okamoto* 3 3 Mr. N. C. Sharma 4 4 Mr. R. Sankaran 4 4 *Appointed w.e.f. 16/05/2016 As per the provisions of Code for Independent Directors as laid down in Schedule IV of the Companies Act, 2013, a separate meeting of Independent Directors was duly held on 27 th March, No other Directors or Key Managerial participated in the said meeting. 18. Committees of Board A. Audit Committee: Pursuant to the Section 177 of the Companies Act, 2013, the Board has constituted an Audit Committee of the Board comprising the following Members: i. Mr. R. Sankaran - Chairman ii. Mr. N. C. Sharma - Member iii. Mr. Kenji Setogawa - Member The Audit Committee of the Board met four times during the year under review on 16/05/2016, 08/09/2016, 10/11/2016 and 14/02/2017. The particulars of attendance of the Committee members at the said meetings are provided in the table below. Name of Committee member Number of Audit Committee Meetings held during the year Number of Audit Committee Meetings attended during the year Mr. Kenji Setogawa 4 4 Mr. N. C. Sharma 4 4 Mr. R. Sankaran 4 4

7 B. Nomination and Remuneration Committee: MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) Pursuant to the Section 178 of the Companies Act, 2013, the Board has constituted a Nomination and Remuneration Committee ( NRC ) of the Board comprising the following Members: i. Mr. N. C. Sharma - Chairman ii. Mr. R. Sankaran - Member iii. Mr. Vipul M. Mashruwala - Member iv. Mr. Kenji Setogawa - Member During the year under review, a meeting of the NRC of the Board was held on 16/05/2016 and all the committee members were present in the said meeting. C. Corporate Social Responsibility (CSR) Committee: Pursuant to the Section 135 of the Companies Act, 2013, the Board has constituted a CSR Committee of the Board comprising the following Members: i. Ms. Anna Abraham - Chairperson ii. Mr. Arvind M. Kulkarni - Member iii. Mr. R. Sankaran - Member iv. Mr. Kosuke Okamoto - Member The CSR Committee of the Board met two times during the year under review on 10/11/2016 and 14/02/2017. The particulars of attendance of the Committee members at the said meetings are provided in the table below. Name of Committee member Number of CSR Committee Meetings held during the year Number of CSR Committee Meetings attended during the year Ms. Anna Abraham 2 2 Mr. Arvind M. Kulkarni 2 2 Mr. R. Sankaran 2 2 Mr. Kosuke Okamoto Corporate Social Responsibility (CSR) As per the audited financial statements of the Company for the financial year ended 31 st March, 2016, the net profit (before tax expenses) of the Company was. 64,730,740/-. In view of the same and pursuant to the applicability of the provisions of Section 135 of the Companies Act, 2013 ( the Act ) read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors constituted a CSR Committee and have approved the CSR Policy, CSR Activities / Programs and CSR Expenditure for the Financial Year The CSR Policy, Statement and Report on CSR initiatives taken during the year pursuant to Section 135 of the Act is annexed to the Board s Report as Annexure B. 6

8 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) 20. Directors Remuneration Policy & Criteria for Matters under Section 178 Information on the Company's policy on director's appointment and remuneration including the criteria for determining the qualifications, positive attributes and independence of a director and other matters provided under Section 178(3) are given in the statement annexed to this report as Annexure C. 21. Risk Management Policy The process of identification and evaluation of various risks inherent in the business environment and the operations of the Company and initiation of appropriate measures for prevention and/or mitigation of the same are dealt with by the concerned operational heads under the overall supervision of the Board of Directors of the Company. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews, adequacy of which is periodically assessed by the Audit Committee and the Board of Directors. 22. Adequacy of Internal Financial Controls Adequate systems for internal controls provide assurances on the efficiency of operations, security of assets, statutory compliance, appropriate authorization, reporting and recording transactions. The scope of the audit activity is broadly guided by the annual audit plan approved by the top management and audit committee. The Internal Auditor prepares regular reports on the review of the systems and procedures and monitors the actions to be taken. 23. Performance Evaluation of the Board Pursuant to the provisions of the Companies Act, 2013, a separate exercise was carried out to evaluate the performance of individual directors, including the Chairman of the Board who were evaluated on parameters such as level of engagement, contribution, openness to new ideas, risk management compliances, independence of judgement, and safeguarding the interests of the Company. The performance evaluation of the Independent directors was carried out by the entire Board. The performance evaluation of the Chairman and Non-Independent Directors was carried out by the Independent Directors. The Board also carried out annual performance evaluation of the working of the Audit and Nomination & Remuneration Committees. The directors have expressed satisfaction with the evaluation process. 24. A. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo Information relating to energy conservation and technology absorption and Foreign exchange, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8 (3) of the Companies (Accounts) Rules, 2014 for the financial year ended 31 st March, 2017 is as under: a) Energy Consumption: The major manufacturing of the company is vendored out to Mukand Ltd. Hence, there is nothing to report in this clause. 7

9 b) Technology Absorption: 8 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) The Company has capitalized & commissioned a New Wire Drawing machine fitted with On-Line ECT machine from Japan. This is a state of the art technology. The Company has started production of import substitute products (Wires) which would be used by component manufacturers for producing auto components. c) Foreign Exchange: Foreign Exchange earnings for the year were Million ( Million for FY 16); and the Foreign exchange outgo was Million ( 6.38 Million for FY 16). B. Particulars of Employees There were no employees employed throughout or part of the year whose remuneration was within the purview of the limits/criteria prescribed under the provisions of Section 197 of the Companies Act, 2013 read with Rule 5(2) and rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, Presentation of Financial Results The financial results of the Company for the financial year ended 31 st March, 2017 have been disclosed as per Schedule III to the Companies Act, Auditors A. Statutory Auditors: Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the rules made thereunder, the current auditors of the Company, M/s. Haribhakti & Co. LLP, Chartered Accountants (Firm Registration No W) were appointed by the shareholders at the 4 th Annual General Meeting (AGM) to hold office until the conclusion of the 5 th AGM. As per the provisions of the Section 139(2) of the Companies Act, 2013, the Company is required to appoint Statutory Auditors of the Company, maximum for one (1) term of five (5) years effective from the ensuing AGM i.e. 5 th AGM of the Company to hold office upto 10 th AGM to be held in calendar year Therefore, it is proposed to appoint M/s. Haribhakti & Co. LLP as statutory auditors of the Company for a period of five years i.e. from the 5 th AGM of the Company to hold office upto 10 th AGM to be held in calendar year The Company has received a confirmation from the said Auditors that they are not disqualified to act as the Auditors and are eligible to hold the office as Auditors of the Company. The Statutory Audit Report does not contain any qualification, reservation or adverse remark or disclaimer made by the Statutory Auditor.

10 MUKAND SUMI METAL PROCESSING LIMITED (CIN: U27300MH2012PLC234000) B. Cost Auditors: Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, your Company has been carrying out audit of cost records relating to processes of Special, Alloy Steel and Stainless Steel Bars. The Board of Directors, on the recommendation of the Audit Committee, at their meeting held on 18 th May, 2017 has appointed CMA Sangita Kulkarni, Cost Accountant as the Cost Auditors of the Company for the financial year on a remuneration of. 30,000/- and reimbursement of travelling and other out of pocket expenses plus taxes as applicable. Further, as per the provisions of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration to the Cost Auditor, recommended by the Audit committee and approved by the Board is required to be ratified by the shareholders. In this regard, the necessary resolution for ratification of remuneration to the Cost Auditor is included in the Notice of 5 th AGM for seeking approval of the members. C. Secretarial Auditor: As per the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder, the Board of Directors at their meeting held on 14 th February, 2017, had appointed, D. K. M. & Associates, Practicing Company Secretaries, (Membership No: FCS 6102), to conduct the Secretarial Audit of the Company for the Financial Year The Secretarial Audit Report for the year under review does not contain any qualification, reservation or adverse remark or disclaimer made by the Secretarial Auditor. The Secretarial Audit Report in Form MR-3 is annexed to this report as Annexure D. For and on behalf of the Board of Directors Date: 18 th May, 2017 Place: Mumbai sd/- Arvind M. Kulkarni Director & CEO DIN: sd/- Kenji Setogawa Director DIN:

11 ANNEXURE - A Mukand Sumi Metal Processing Limited CIN: U27300MH2012PLC Form No. MGT-9 EXTRACT OF ANNUAL RETURN as on the financial year ended on 31 st March, 2017 [Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014] I. REGISTRATION AND OTHERS DETAILS i) CIN U27300MH2012PLC ii) Registration Date 01/08/2012 iii) Name Of The Company MUKAND SUMI METAL PROCESSING LIMITED iv) Category /Sub-Category Of The Company Company having Share Capital v) Address of the Registered office and contact details 3rd Floor, Bajaj Bhawan, Jamnalal Bajaj Marg, 226, Nariman Point, Mumbai, Maharashtra Ph: Fax: vi) Whether Listed Company (Yes/No) No vii) II. Sr. No. Name, Address and Contact details of Registrar and Transfer Agent, if any PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY Not Applicable All the business activities contributing 10 % or more of the total turnover of the company shall be started Name and Description of Main Products/ Services NIC Code Of The Product /Service % to total turnover of the Company 1 Manufacture of Alloy & Stainless Steel Bright Bars & Wires % III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES Sr. No. Name and Address of the Company CIN / GLN Holding/ Subsidiary/ Associate % of shares held 1 Mukand Limited L99999MH1937PLC Holding (46) Applicable Section

12 IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as Percentage of Total Equity) i) Categary-wise Share Holding Categary of Shareholders No. of shares held of the beginning of the year (1st April, 2016) No. of shares held of the end of the year (31st March, 2017) % change during the year Demat Physical Total % of Total Shares Demat Physical Total % of Total Shares A. Promoters 1. Indian a. Individual/HUF b. Central Govt c. State Govt d. Bodies Corp e. Bank/ FI f. Any Other Sub-Total (A)(1) Foreign - a. NRI- Individuals b. Other Individuals c. Bodies Corporate d. Banks/FI e. Any Other Sub-Total (A)(2) Total Shareholding Of Promoter (A) = (A)(1) + (A)(2) B. Public Shareholding 1. Institutions a. Mutal Funds b. Bank/ FI c. Central Govt d. State Govt(s) e. Venture Capital Funds f. Insurance Companies g. FIIs h. Foreign Venture Capital i. Others (specify) Sub-Total (B)(1) Non- Institutions a. Body Corporate i. Indian ii. Overseas b. Individuals i. Individual shareholders holding nominal share capital upto. 1 lakh ii. Individual shareholders holding nominal share capital in excess of. 1 lakh c. Others (specify) i.clearing members ii.nris iii.trusts (Employee Welfare Funds) iv.non Promoter - Non Public Employee Welfare Funds Sub-Total -B-(2) Total Public Shareholding (B) = (B)(1) + (B)(2) C. Shares held by Custodian for GD & AD Grand Total (A+B+C) ii) Shareholding of Promoters Sr. Shareholder's Name No. No. of Shares % of total shares of the Company % of shares pledged/ encumbered to total shares No. of Shares % of total shares of the Company % of shares pledged/ encumbered to total shares 1 Mukand Limied along with its Nominees Sumitomo Corporation, Japan Sumitomo Corporation India Pvt. Ltd TOTAL Sr. No. No. of shares held of the beginning of the year (1st April, 2016) iii) Change in Promoters' Shareholding (please specify, if there is no change) Shareholding at the beginning of the year (1st April, 2016) / at the end of the year (31st March, 2017) Cumulative Shareholding during the year No. of shares held of the end of the year (31st March, 2017) % Change in shareholding during the year No. of Shares % of total shares of the Company No. of Shares % of total shares of the Company At the begining of the year Date wise increase/ decrease in Promoters NIL NIL NIL NIL Shareholding during the year specifying the reasons for increase / decrease (e.g. Allotment / transfer/ bonus/ sweat equity etc.) At the end of the year

13 Sr. No. iv) Shareholding pattern of top ten shareholders (other than Directors, Promoters and Holders of GD and AD) Shareholding at the beginning of Shareholding at the end of the year the year (1st April, 2016) (31st March, 2017) For Each of the top 10 Shareholders No. of Shares % of total shares of the Company No. of Shares % of total shares of the Company Not Applicable Sr. No. v) Shareholding of Directors and Key Managerial Personnel Shareholding at the beginning of the year (1st April, 2016) / at the end of the year (31st March, 2017) Date increase/ decrease in shareholding Reason Cumulative Shareholding during the year For Each of the Directors & KMP No. of Shares % of total shares of the Company Directors No. of Shares % of total shares of the Company 1 Rajesh V. Shah - Chairman Arvind M. Kulkarni* /09/ Vipul M. Mashruwala* /09/ Anna Abraham N. C. Sharma R. Sankaran Kenji Setogawa Masaki Sasamoto Kosuke Okamoto Key Managerial Personnel 1 Arvind M. Kulkarni* Chief Executive Officer^ /09/ Shingo Mizuho Chief Financial Officer /09/ K. J. Mallya* Company Secretary /09/ Note: *Mr. Arvind M. Kulkarni, Mr. Vipul M. Mashruwala and Mr. K. J. Mallya hold shares as nominees of Mukand Limited ^Mr. Arvind M. Kulkarni was appointed / re-designated as Chief Executive Officer with effect from 21st September, 2016

14 V. INDEBTEDNESS Indebtedness of the Company including interest outstanding/ accrued but not due for payment (. in Crore) Secured Loans Unsecured Deposits Total excluding deposits Loans Indebtedness VI. Sr No INDEBTEDNESS AT THE BEGINNING OF THE FINANCIAL YEAR i.principal Amount ii.interest due but not paid iii.interest accrued but not due Total (i+ii+iii) Changes in indebtedness during the financial year *Addition The Company has neither invited nor renewed any 5.83 *Reduction - - Deposits - Net Change INDEBTEDNESS AT THE END OF THE FINANCIAL YEAR i.principal Amount ii.interest due but not paid iii.interest accrued but not due Total (i+ii+iii) REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-Time Directors and /or Manger : The Company has paid no remuneration to Mr. Arvind M. Kulkarni, Manager* of the Company B. Remuneration to other directors: Particulars Of Remuneration (in.) Mr. Rajesh V. Shah Mr. Arvind M. Kulkarni Mr. Vipul M. Mashruwala Ms. Anna Abraham Mr. Kenji Setogawa Mr. Masaki Sasamoto Mr. Kosuke Okamoto Mr. N. C. Sharma Mr. R. Sankaran 1 Independent Directors Fee for attending Board Meetings , , , Committee Meetings , , , Commission Others, please specify Independent Directors Meeting , , , TOTAL (1) , , , Other Non-Executive Directors Fee for attending Board Meetings Committee Meetings - Commission Others, please specify TOTAL (2) TOTAL (B) = (1+2) , , , Total Managerial Remuneration Overall Ceiling as per the Act Name of Directors Total Amount C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD: The Company has paid no remuneration to Mr. Arvind M. Kulkarni**, CEO and Mr. K. J. Mallya, Company Secretary Sr Particulars Of Remuneration (in.) No Gross Salary (a) Salary as per provisions contained in section 17(1) of the Income tax Act, 1961 (b)value of perquisites u/s.17(2) of Income tax Act, 1961 (c) Profits in liue of salary under section 17(3) Income tax Act, 1961 Stock Option Sweat Equity Commission - as % of profit - other, specify Others, please specify TOTAL Key Managerial Personnel Mr. Shingo Mizuho, CFO 2,004, , ,394,200 *Mr. Arvind M. Kulkarni ceased to be Manager with effect from 20th September, 2016 **Mr. Arvind M. Kulkarni was appointed / re-designated as Chief Executive Officer with effect from 21st September, 2016

15 VII. PENALTIES/ PUNISHMENT/ COMPOUNDING OF OFFENCES Type Section of the Companies Act A. COMPANY Penalty Punishment Compounding B. DIRECTORS Penalty Punishment Compounding C. OTHER OFFICERS IN DEFAULT Penalty Punishment Compounding Brief Description Details of Penalty/ Punishment/ Compunding fees imposed NIL NIL NIL Authority [RD/ NCLT/ Court] Appeal made, if any (give details) For and on behalf of the Board of Directors Date: 18th May, 2017 Place: Mumbai sd/- Arvind M. Kulkarni Director & CEO sd/- Kenji Setogawa Director DIN: DIN:

16 ANNEXURE B MUKAND SUMI METAL PROCESSING LIMITED 1. A BRIEF OUTLINE OF THE COMPANY S CSR POLICY, INCLUDING OVERVIEW OF PROJECTS OR PROGRAMS PROPOSED TO BE UNDERTAKEN A. Introduction and background The Company is committed to abiding by the laws of the land it operates in and will support or implement activities that positively affect the economically and socially disadvantaged population and / or the environment. B. CSR Policy A detailed CSR Policy was framed by the Company on 10 th November, 2016 with approvals of the CSR Committee and Board of Directors. The Policy, inter alia, covers the following: Vision and Mission Scope and List of Activities / Programs Governance and Accountability of the CSR Committee CSR Outlay of the Company C. Overview of Projects or programs proposed to be undertaken The CSR committee decided to support Concern India Foundation in the Mimaansa Project for a period of three years where in trained personnel will identify and provide special learning support to children with Learning Defects in 2 Municipal schools in Thane. The project also covers training of the existing teachers to handle these children with special needs. 2. THE COMPOSITION OF THE CSR COMMITTEE In view of the applicability of the provisions of Section 135 of the Companies Act, 2013, the Board at its meeting

17 held on 10 th November, 2016 constituted a CSR Committee comprising of the following Members: Ms. Anna Abraham - Chairperson Mr. Arvind M. Kulkarni - Member Mr. R. Sankaran - Member Mr. Kosuke Okamoto - Member 3. AVERAGE NET PROFITS OF THE COMPANY FOR LAST THREE FINANCIAL YEARS PRIOR TO = RS. 4,29,08,633/- 4. PRESCRIBED CSR EXPENDITURE (2% of the amount as in Item No. 3 above) = RS. 8,58,173/- 5. DETAILS OF CSR SPENT DURING THE FINANCIAL YEAR a) Total Amount to be spent for the Financial Year =. 8,92,080/- b) Amount Unspent =. 92,080/- c) Manner in which the amount spent during the financial year is detailed below: Name / Details of Implement ation Agency Concern Inda Foundation CSR Project/ Activity Identifi ed Providing remedial education program in Municipal Schools Sector in which the Project is covered Promoting education, among children with learning defect Location of Projects/ Programme (Local Area/ District/ State) Thane, Maharashtra Amount Approved (.) Amount Spent (.) Cumulati ve Expendit ure upto FY (.) 8,92,080/- 8,00,000/- 8,00,000/-

18 6. IN CASE THE COMPANY FAILS TO SPEND THE 2 % OF THE AVERAGE NET PROFIT OF THE LAST THREE FINANCIAL YEARS OR ANY PART THEREOF, THE COMPANY SHALL PROVIDE THE REASONS FOR NOT SPENDING THE AMOUNT IN ITS BOARD REPORT The Company has spent. 8,00,000/- on its CSR initiatives in FY out of allocated amount of. 8,92,080/-. The Company proposes to support Concern India Foundation for a period of three years and accordingly the balance amount would be spent in the Financial Year A RESPONSIBILITY STATEMENT OF THE CSR COMMITTEE THAT THE IMPLEMENTATION AND MONITORING OF CSR POLICY, IS IN COMPLIANCE WITH CSR OBJECTIVES AND POLICY OF THE COMPANY The CSR Committee confirms that the implementation and monitoring of CSR Policy is in compliance with CSR objectives and Policy of the Company. Date: 18 th May, 2017 Place: Mumbai sd/- Arvind M. Kulkarni Director & CEO DIN: sd/- Anna Abraham Chairperson of CSR Committee DIN:

19 ANNEXURE C MUKAND SUMI METAL PROCESSING LIMITED (I) REMUNERATION POLICY FOR DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES A. INDEPENDENT DIRECTORS(IDs) IDs are to be paid i) a sitting fee of. 20,000/- for every meeting of the Board, attended by them; and ii) a sitting fee of. 10,000/- for every meeting of Committee of the Board and meeting of Independent Directors, attended by them. The Company has no stock options plans and no payment by way of bonus, pension, incentives etc. is paid to IDs. B. NON-EXECUTIVE DIRECTORS(NEDs) All NEDs being nominees of Joint Venture partners viz. Mukand Limited and Sumitomo Corporation are categorized as Non-Independent and hence no remuneration is paid to them. C. MANAGING DIRECTOR & KEY MANAGERIAL PERSONNEL & OTHER EMPLOYEES The objective of the policy is directed towards having a compensation philosophy and structure that will reward and retain talent. The Remuneration to Managing Director, if any to be paid, shall take into account the Company s overall performance, MDs contribution for the same & trends in the industry in general, in a manner which will ensure and support a high performance culture. The Company has no stock options, plans and hence such instruments do not form part of his remuneration package. The Remuneration to others will be such as to ensure that the relationship of remuneration to performance is clear and meets appropriate performance benchmarks.

20 Remuneration to Directors, Key Managerial Personnel and Senior Management will involve a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goals. (II) CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES & INDEPENDENCE OF DIRECTOR A. QUALIFICATIONS OF INDEPENDENT DIRECTOR The Nomination & Remuneration Committee while recommending the appointment, keep in view that an independent director shall possess requisite skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, operations or other disciplines related to the company s business. B. POSITIVE ATTRIBUTES OF INDEPENDENT DIRECTORS An independent director shall be a person of integrity, who possesses relevant expertise & experience and who shall uphold ethical standards of integrity and probity, act objectively and constructively, exercise his responsibilities in a bona-fide manner in the interest of the company; devote sufficient time and attention to his professional obligations for informed and balanced decision making; and assist the company in implementing the best corporate governance practices. C. INDEPENDENCE OF INDEPENDENT DIRECTORS An independent director should meet the requirements of the Companies Act, For and on behalf of the Board of Directors Date: 18 th May, 2017 Place: Mumbai sd/- Arvind M. Kulkarni Director & CEO DIN: sd/- Kenji Setogawa Director DIN:

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23 INDEPENDENT AUDITOR S REPORT To the Members of Mukand Sumi Metal Processing Limited Report on the Financial Statements We have audited the accompanying financial statements of Mukand Sumi Metal Processing Limited ( the Company ), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information. Management s Responsibility for the Financial Statements The Company s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ( the Act ) with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls and ensuring their operating effectiveness and the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company s Directors, as well as evaluating the overall presentation of the financial statements. 1

24 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements. Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2017, its profit and its cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements (1) As required by the Companies (Auditors Report) Order, 2016 ( the Order ) issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in Annexure 1, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable. (2) As required by Section 143(3) of the Act, we report that: a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit; b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books; c. The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account; d. In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014; e. On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act; f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, we give our separate Report in Annexure 2. g. With respect to the other matters to be included in the Auditor s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: (i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements Refer Note 15 on Contingent Liabilities to the financial statements; (ii)the Company did not have any long-term contracts including derivative contracts. Hence, the question of any material foreseeable losses does not arise; 2

25 (iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company. (iv) The company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 th November, 2016 to 30 th December, Based on audit procedures and relying on the management representation, we report that the disclosures are in accordance with the books of account maintained by the company and as produced to us by the Management (Refer Note No.16 to the financial statements); For Haribhakti & Co. LLP Chartered Accountants ICAI Firm Registration No W/W Sd/- Sumant Sakhardande Partner Membership No.: Place : Mumbai Date : May 18,

26 ANNEXURE 1 TO THE INDEPENDENT AUDITOR S REPORT [Referred to in paragraph 1 under Report on Other Legal and Regulatory Requirements in the Independent Auditor s Report of even date to the members of Mukand Sumi Metal Processing Limited on the financial statements for the year ended March 31, 2017] (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. (b) During the year, the fixed assets of the Company have been physically verified by the management and as informed, no material discrepancies were noticed on such verification. In our opinion, the frequency of verification is reasonable having regard to the size of the Company and the nature of its assets. (c) The title deeds of immovable properties recorded as fixed assets in the books of account of the Company are held in the name of the Company. (ii) The inventory (excluding stocks lying with third parties) has been physically verified by the management during the year. In our opinion, the frequency of verification is reasonable. As informed, no material discrepancies were noticed on physical verification carried out during the year (iii) As informed, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3 (iii)(a), 3 (iii)(b) and 3 (iii)(c) of the Order are not applicable to the Company. (iv) Based on information and explanation given to us in respect of loans, investments, guarantees and securities, the Company has not entered into any transactions which fall under the purview of Section 185 and 186 of the Act. (v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the provisions of Sections 73 to 76 of the Act and the rules framed there under. (vi) We have broadly reviewed the books of account maintained by the Company in respect of products where the maintenance of cost records has been specified by the Central Government under sub-section (1) of Section 148 of the Act and the rules framed there under and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. (vii) The Company is generally regular in depositing with appropriate authorities, undisputed statutory dues including provident fund, employees state insurance, income tax, sales tax, service tax, value added tax, customs duty, excise duty, cess and any other material statutory dues applicable to it, however, there have been slight delay in few cases. (a) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees state insurance, income tax, sales 4

27 tax, service tax, value added tax, customs duty, excise duty, cess and any other material statutory dues applicable to it, were outstanding, at the year end, for a period of more than six months from the date they became payable. (b) According to the information and explanation given to us, the dues outstanding with respect to, income tax, sales tax, service tax, value added tax, customs duty, excise duty on account of any dispute, are as follows: Name of the statute Income Tax Act, 1961 Nature of dues Amount. Period to which the amount relates Forum where dispute is pending Income Tax 7,400,670 FY CIT (A) Remarks (viii) According to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to financial institution(s), bank(s), government(s) or dues to debenture holder(s). (ix) The Company has neither raised money by way of public issue offer nor has obtained any term loans. Therefore, paragraph 3(ix) of the Order is not applicable to the Company. (x) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud by the Company or any fraud on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such instance by the management. (xi) According to the information and explanations given to us, no managerial remuneration, except sitting fees, has been paid / provided by the company for the year. (xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Therefore, paragraph 3(xii) of the Order is not applicable to the Company. (xiii) According to the information and explanation given to us, all transactions entered into by the Company with the related parties are in compliance with Sections 177 and 188 of Act, where applicable and the details have been disclosed in the Financial Statements etc., as required by the applicable accounting standards. (xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Therefore, paragraph 3(xiv) of the Order is not applicable to the Company. (xv) According to the information and explanations given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him during the year. 5

28 (xvi) According to the information and explanation given to us, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, For Haribhakti & Co. LLP Chartered Accountants ICAI Firm Registration No W/W Sd/- Sumant Sakhardande Partner Membership No.: Place : Mumbai Date : May 18,

29 MUKAND SUMI METAL PROCESSING LIMITED CIN :U27300MH2012PLC BALANCE SHEET AS AT 31ST MARCH,2017 Note No. I. EQUITY AND LIABILITIES (1) Shareholders' Funds (a) Share Capital 1 273,000, ,000,000 (b) Reserves and surplus 2 2,620,818,070 2,533,082,525 2,893,818,070 2,806,082,525 (2) Non Current Liabilities (a) Deferred tax liability (net) 7 75,663,864 40,380,303 (3) Current Liabilities (a) Short Term Borrowings 3 185,512, ,255,719 (b) Trade payables 4 Total outstanding dues of Micro & Small Enterprises - - Total outstanding dues of creditors other than Micro & Small Enterprises 76,429, ,245,911 (c) Other current liabilities 5 37,282,969 67,461, ,224, ,963,556 Total 3,268,706,606 3,362,426,384 II. ASSETS (1) Non Current Assets (a) Fixed Assets 6 (i) Tangible assets 352,607, ,240,599 (ii) Intangible assets 1,332,595,922 1,524,947,423 (iii) Capital work-in-progress 14,443,363 16,015,475 1,699,646,947 1,906,203,497 (b) Long-term loans and advances 8 23,606,464 7,715,494 (c) Other Non Current Assets 9 52,425,224 27,432,578 76,031,688 35,148,072 (2) Current Assets (a) Inventories ,629, ,030,770 (b) Trade receivables ,526, ,672,907 (c) Cash and Bank Balances 12 96,084, ,189,270 (d) Short-term loans and advances ,568, ,147,430 (e) Other Current Assets 14 4,219,069 21,034,438 1,493,027,971 1,421,074,815 Total 3,268,706,606 3,362,426,384 Statement of Significant Accounting Policies adopted by the Company and Notes forming part of the Financial Statements As per our attached report of even date For Haribhakti & Co. LLP Chartered Accountants Firm Registration No W /W Mar Mar to For and on Behalf of Board of Directors of Mukand Sumi Metal Processing Limited Sd/- Sd/- A M Kulkarni Kenji Setogawa (Director & CEO) (Director) Sumant Sakhardande (DIN : ) (DIN : ) Partner Sd/- Sd/- Membership No Shingo Mizuho K J Mallya (Chief Financial Officer) (Company Secretary) Place: Mumbai. Place: Mumbai. Date: 18th May, 2017 Date: 18th May, : 1 : -