REPORT OF THE BOARD OF DIRECTORS TO THE MEMBERS OF WIMCO ...

WIMCO LIMITED

REPORT OF THE BOARD OF DIRECTORS

TO THE MEMBERS OF WIMCO LIMITED

1.

Your Directors submit their Report for the financial year ended 31st March,

2019.

2.

COMPANY PERFORMANCE

6.

As required under Section 134 of the Act, your Directors confirm having:

The Company¡¯s business activities comprise fabrication and assembly

of machinery for tube filling, cartoning, wrapping, material handling

including conveyor solutions, and engineering services for the FMCG and

Pharmaceutical industries.

Your Company¡¯s order book for machines, during the year, remained

muted due to sluggish demand for capital investments arising out of

excess capacity in FMCG and Pharmaceutical industries, coupled with stiff

competition. Your Company¡¯s Revenue from Operations for the year stood

at ` 967.92 lakhs (previous year: ` 877.03 lakhs). The Net Profit for the year

was ` 3.73 lakhs as against Loss of ` 303.13 lakhs during the previous year

and the Total Comprehensive Income was ` 5.98 lakhs (previous year: loss

of ` 301.30 lakhs).

4.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

(a) Changes in Directors and Key Managerial Personnel during the

year

7.

8.

(e) Remuneration Policy

The Remuneration Policy of the Company for the Directors, Key

Managerial Personnel and other employees, as approved by the

Board, is enclosed as Annexure 1 to this Report.

5.

BOARD AND BOARD COMMITTEES

The three Board Committees of the Company and their present

composition is as follows:

Audit Committee

Nomination and Remuneration

Committee

Mr. P. Chatterjee (Chairman) Mr. P. Chatterjee (Chairman)

Mr. S. Banerjee

Mr. S. Banerjee

Mr. R. Senguttuvan

Mr. D. Dutta

Mr. R. Tandon

Securityholders Relationship Committee

Mr. R. Poddar (Chairman)

Mr. D. Dutta

Mr. R. Senguttuvan

Four meetings of the Board were held during the year ended 31st March,

2019.

384

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES

PARTICULARS OF EMPLOYEES

The Company seeks to enhance equal opportunities for men and women

and is committed to a gender-friendly workplace. Your Company has

constituted an Internal Complaints Committee in compliance with the

applicable provisions of the Sexual Harassment of Women at Workplace

(Prevention, Prohibition and Redressal) Act, 2013. During the year under

review, no complaint for sexual harassment was received.

(c) Attributes, qualifications and appointment of Directors

In accordance with the provisions of Section 152 of the Act read

with Article 131 of the Articles of Association of the Company, Mr.

Rajiv Tandon (DIN: 00042227), Director, will retire by rotation at the

ensuing Annual General Meeting (¡®AGM¡¯) of the Company, and being

eligible, offers himself for re-election. Your Board has recommended

his re-election.

devised proper systems to ensure compliance with the provisions of

all applicable laws and that such systems are adequate and operating

effectively.

The relations between your Company and its employees continued

to remain cordial during the year under review. The details of top ten

employees of the Company in terms of remuneration drawn, as required

under Rule 5(2) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014, are provided in Annexure 2 to this

Report.

The Independent Directors of your Company have confirmed that

they meet the criteria of Independence as prescribed under Section

149 of the Companies Act, 2013 (¡®the Act¡¯) read with Rule 5 of the

Companies (Appointment and Qualification of Directors) Rules, 2014.

(d) Retirement by Rotation

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 at

the end of the financial year and of the profit of the Company for that

period;

The Company does not have any subsidiary, associate or joint venture.

(b) Declaration of Independence by Independent Directors

All the Directors of the Company are appointed by the Board based

on the recommendation of the Nomination and Remuneration

Committee; this Committee reviews the fit and proper status of the

Directors. Two of the Non-Executive Directors, including the Chairman,

are executives of ITC Limited, the Holding Company. All the Directors,

other than the Independent Directors and the Managing Director, are

liable to retire by rotation and one-third of them retire every year and

are eligible for re-election.

ii)

v)

During the year, there was no change in the composition of the

Board of Directors (¡®the Board¡¯) and Key Managerial Personnel of your

Company.

As reported in earlier years, the attributes and qualifications of the

Independent Directors provided in Section 149 of the Act read with

Rule 5 of the Companies (Appointment and Qualification of Directors)

Rules, 2014 were adopted by the Nomination and Remuneration

Committee. The said attributes and qualifications, as applicable, were

also adopted in respect of the other Directors.

followed in the preparation of the Annual Accounts, the applicable

Accounting Standards with proper explanation relating to material

departures, if any;

iv) prepared the Annual Accounts on a going concern basis; and

DIVIDEND

In view of the accumulated losses, your Directors are unable to recommend

any dividend for the year under review.

i)

iii) 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;

Your Company continues to focus on developing superior solutions

towards addressing customer requirements.

3.

DIRECTORS¡¯ RESPONSIBILITY STATEMENT

9.

RISK MANAGEMENT

The Company¡¯s risk management framework, designed to bring robustness

to the risk management processes, addresses risks intrinsic to operations,

financials and compliances arising out of the overall strategy of the

Company.

Management of risks vests with the executive management which is

responsible for the day-to-day conduct of the affairs of the Company, within

the overall framework approved by the Board. The Internal Auditor of the

Company, appointed by the Board, periodically carries out risk focused

audits with the objective of identifying areas where risk management

processes could be strengthened. The Audit Committee annually reviews

the effectiveness of the Company¡¯s risk management systems and policies.

10. INTERNAL FINANCIAL CONTROLS

Your Company has in place adequate internal financial controls with

respect to the financial statements, commensurate with its size and

scale of operations. The Internal Auditor of the Company periodically

evaluates the adequacy and effectiveness of internal financial controls.

The Audit Committee which provides guidance on internal controls,

also reviews internal audit findings and implementation of internal audit

recommendations.

During the year, the internal financial controls in the Company with

respect to the financial statements were tested and no material weakness

in the design or operation of such controls was observed. Nonetheless,

your Company recognises that any internal financial control framework,

no matter how well designed, has inherent limitations and accordingly,

regular audit and review processes ensure that such systems are reinforced

on an ongoing basis.

11. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

During the year ended 31st March, 2019, the Company has neither given

any loan or guarantee nor has made any investment under Section 186 of

the Act.

12. RELATED PARTY TRANSACTIONS

The details of material related party transactions of the Company in the

prescribed Form No. AOC-2 are enclosed under Annexure 3 to this Report.

WIMCO LIMITED

13. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS /

COURTS / TRIBUNALS

During the year under review, no significant or material orders were passed

by the Regulators / Courts / Tribunals impacting the going concern status

of the Company and its future operations.

14. EXTRACT OF ANNUAL RETURN

The extract of Annual Return in the prescribed Form No. MGT-9 is enclosed

as Annexure 4 to this Report.

15. COST RECORDS

The Company is not required to maintain cost records in terms of Section

148 of the Act read with the Companies (Cost Records and Audit) Rules,

2014.

16. STATUTORY AUDITORS

The Company¡¯s Auditors, Messrs. Deloitte Haskins & Sells, Chartered

Accountants (¡®DHS¡¯), were appointed with your approval at the 91st AGM

to hold such office for a period of five years till the conclusion of the 96th

AGM. DHS will complete their present term on conclusion of the ensuing

96th AGM of the Company.

On the recommendation of the Audit Committee, your Board has

recommended for the approval of the Members, re-appointment of DHS as

the Auditors of the Company for a period of five years from the conclusion

of the ensuing 96th AGM till the conclusion of the 101st AGM. The Board,

on the recommendation of the Audit Committee, has also recommended

for the approval of the Members, remuneration of DHS for the financial

year 2019-20. Appropriate resolution seeking your approval to the re-

appointment and remuneration of DHS as the Auditors is appearing in the

Notice convening the 96th AGM of the Company.

17. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company is in compliance with the applicable Secretarial Standards

issued by the Institute of Company Secretaries of India and approved by

the Central Government under Section 118 of the Act.

18. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN

EXCHANGE EARNINGS AND OUTGO

The Company¡¯s operations do not involve substantial consumption of

power in comparison to the costs of production. However, the Company

takes due care to efficiently utilise and manage energy resources resulting

in cost savings for the Company. The Company continuously works on

productivity improvements during fabrication and assembly of machinery

for various customers.

There was no new technology adopted by the Company during the year.

During the year under review, the Company earned foreign exchange of

` 38.06 lakhs, while the total outflow of foreign exchange was ` 0.97

lakhs.

19. ACKNOWLEDGEMENT

The Board acknowledges the support of the Government, shareholders,

banks, customers, suppliers and business associates and the dedication and

hard work of its employees.

On behalf of the Board

Date: 23rd April, 2019

R. Tandon

Chairman

R. Senguttuvan

Managing Director

Annexure 1 to the Report of the Board of Directors for the financial year ended 31st March, 2019

Remuneration Policy

The Company¡¯s Remuneration Strategy is designed to attract and retain talent that gives its business a unique competitive advantage and enables the Company to

achieve its objectives.

The Company¡¯s Remuneration Strategy, whilst focusing on remuneration and related aspects of performance management, is aligned with and reinforces the employee

value proposition of a superior quality of work life, that includes an enabling work environment, an empowering and engaging work culture and opportunities to

learn and grow.

The Compensation approach endeavours to align each employee with the Company¡¯s goals.

POLICY

It is the Company¡¯s policy:

1.

To ensure that its Remuneration practices support and encourage meritocracy.

2.

To ensure that Remuneration is market-led and takes into account the competitive context of the Company¡¯s business.

3.

To leverage Remuneration as an effective instrument to enhance performance and therefore to link the remuneration to both individual and collective performance

outcomes.

4.

To adopt a comprehensive approach to Remuneration in order to support a superior quality of personal and work life, in a manner so as to judiciously balance

short term with long term priorities.

5.

To design Remuneration practices such that they reinforce the Company¡¯s values and culture and to implement them in a manner that complies with all relevant

regulatory requirements.

Remuneration of Managing / Wholetime Directors, Key Managerial Personnel and Senior Management

1.

Remuneration of Key Managerial Personnel and Senior Management is determined and recommended by the Nomination and Remuneration Committee and

approved by the Board. Remuneration of Managing Director / Wholetime Director / Manager is also subject to the approval of the shareholders.

2.

Remuneration is reviewed and revised periodically, when such a revision is warranted by the market.

3.

Apart from fixed elements of remuneration and benefits, Key Managerial Personnel and Senior Management are also eligible for Variable Pay / Performance Bonus

which is linked to their individual performance and the overall performance of the Company.

4.

Remuneration of KMP on deputation from the Holding Company / subsidiary / fellow subsidiary / associate companies, is aligned to the Remuneration Policy of

that company.

Remuneration of Non-Executive Directors

Non-Executive Directors are entitled to sitting fees for attending meetings of the Board and Board Committees, the quantum of which is determined by the Board,

within the limits prescribed under the Companies Act, 2013 and the Rules thereunder. Non-Executive Directors are also entitled to reimbursement of expenses for

attending meetings of the Board and Board Committees and General Meetings.

Remuneration of Management Staff

1.

Remuneration of Management Staff is approved by the Board on the recommendation of the Executive Management Committee.

2.

Remuneration is reviewed and revised periodically, when such a revision is warranted by the market. The quantum of revision is linked to market trends, the

competitive context of the Company¡¯s business, as well as the track record of the individual employee.

3.

Variable Pay cognises for the performance rating of the individual employee and the overall performance of the Company.

Remuneration of Non-Management Staff

1.

Remuneration of non-management staff is market-led, leverages performance and is approved by the Executive Management Committee.

2.

Remuneration of non-management unionised employees is determined through a process of negotiations with the recognised union/s or employee representatives,

through a long-term agreement.

3.

Remuneration, comprising fixed and variable components, is arrived at based on benchmarking with region-cum-industry practices and cognizing for market

dynamics, competitiveness of the unit, overall performance of the Company¡¯s business, availability of skills, inflation/cost of living and the impact of cost escalation

and productivity gains on present and future competitiveness.

385

WIMCO LIMITED

Annexure 2 to the Report of the Board of Directors for the financial year ended 31st March, 2019

[Information pursuant to Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

Names of

employees

Age

Designation

Gross

Remuneration

(`)

Net

Remuneration

(`)

Qualifications

Experience

(Years)

Date of

commencement

of employment /

deputation

Previous

Employment /

Position held

1

2

3

4

5

6

7

8

9

S. Mundra *

33

Chief Financial

Officer

36,07,407/-

23,42,942/-

., A.C.A.

9

01.07.2017

Assistant

Manager (Finance) - ITC

Limited

S. V. Limaye

53

Vice President

28,53,700/-

19,68,735/-

B.E. (Prodn.),

P.G.P.M.

26

04.01.2006

Deputy

General

Manager ¨C Cosmo

Films Limited

P. P. Dakhole

44

Manager ¨C

Design

10,64,123/-

9,35,525/-

B. E.

(Mechanical)

12

15.07.2016

Manager Design ¨C

ASB International

Pvt. Ltd.

M. K. Singh

39

Manager ¨C Sales

9,60,436/-

8,00,838/-

M.B.A. Marketing &

Finance, B.E.

(Electronics)

10.5

02.01.2017

National Sales Manager ¨C Technocraft

Industries

(India)

Ltd.

V. S. Jadhav

45

Manager ¨C

Accounts

6,44,810/-

5,73,371/-



23

05.02.2006

Accounts Assistant

¨C Fudkor India Pvt.

Ltd.

A. H. Mendon

55

Manager ¨C IT

5,12,476/-

4,18,865/-

B. Sc.,

P.G.D.B.A

31

18.09.1995

System

Analyst

¨C Lateral Management

Computer

Consultants

G. S. Patil

32

Manager Service

5,05,090/-

4,67,864/-

B.E.

(Instruments)

10

17.07.2017

Service Engineer Sipa India Pvt. Ltd.

Y. V. Potdar

42

Manager - Purchase

4,78,660/-

4,41,312/-

Diploma in

Mechanical Engineering

20

13.08.2018

Factory Head Wraptech Pvt. Ltd.

J. K. Singh

33

Asst. Manager Service

4,34,874/-

3,89,421/-

B. E. (Electronics

& Telecommunication)

10

01.12.2013

Engineer - Suzlon

Energy Limited

L. G. Patil

43

Asst. Manager Service

4,12,310/-

3,72,190/-

Higher Secondary

Certificate,

Industrial

Training Institute

22

24.09.2007

Maintenance

Foremen ¨C Global

Healthcare

* On deputation from ITC limited, the Holding Company (ITC)

Notes:

(a) Gross remuneration includes salary, variable pay, allowances & other benefits / applicable perquisites except provisions for gratuity and leave encashment which are actuarially

determined on an overall Company basis. The term ¡®remuneration¡¯ has the meaning assigned to it under the Companies Act, 2013.

(b) Net remuneration comprises cash income less income tax, education cess deducted at source and employee¡¯s own contribution to provident fund.

(c) Certain employees of the Company have been granted Stock Options by ITC in previous year(s) under its Employee Stock Option Schemes at ¡®market price¡¯ [within the meaning of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014]. ITC has also granted Employee Stock Appreciation Linked Reward Units

(ESAR Units) to the Chief Financial Officer of the Company under its Stock Appreciation Linked Reward Plan. Since these Stock Options and ESAR Units are not tradeable, no

perquisite or benefit is conferred upon the employee by grant of such Options / Units, and accordingly the said grant has not been considered as remuneration.

(d) All appointments (except deputed employees) are / were contractual in accordance with terms and conditions as per Company¡¯s rules.

(e) The aforesaid employees are neither relative of any Director of the Company nor hold any equity share in the Company.

On behalf of the Board

Dated : 23rd April, 2019

386

R. Tandon

R. Senguttuvan

Chairman

Managing Director

WIMCO LIMITED

Annexure 3 to the Report of the Board of Directors for the

financial year ended 31st March, 2019

FORM NO. AOC-2

[Pursuant to Section 134(3)(h) of the Companies Act, 2013 and

Rule 8(2) of the Companies (Accounts) Rules, 2014]

Form for disclosure of particulars of contracts / arrangements entered into by the Company with related parties referred to in sub-section (1) of

Section 188 of the Companies Act, 2013 including certain arm¡¯s length transactions under third proviso thereto

1.

Details of contracts or arrangements or transactions not at arm¡¯s length basis

a)

Name(s) of the related party and nature of relationship

b)

Nature of contracts / arrangements / transactions

c)

Duration of the contracts / arrangements / transactions

d)

Salient terms of the contracts or arrangements or transactions including the value,

if any

e)

Justification for entering into such contracts or arrangements or transactions

f)

Date(s) of approval by the Board

g)

Amount paid as advances, if any

h)

Date on which the special resolution was passed in general meeting as required

under first proviso to Section 188

2.

NIL

Details of material contracts or arrangements or transactions at arm¡¯s length basis

a)

Name(s) of the related party and nature of relationship

ITC Limited, the Holding Company

b)

Nature of contracts / arrangements / transactions

Sale of machineries and related spares / services related to machine maintenance,

installation, repairs, etc.

c)

Duration of the contracts / arrangements / transactions

Ongoing

d)

Salient terms of the contracts or arrangements or transactions

including the value, if any

Value of transaction during the year - ` 376.49 lakhs

e)

Date(s) of approval by the Board, if any

¨C

f)

Amount paid as advances, if any

Nil

On behalf of the Board

Dated : 23rd April, 2019

R. Tandon

R. Senguttuvan

Chairman

Managing Director

387

WIMCO LIMITED

Annexure 4 to the Report of the Board of Directors

FORM NO. MGT-9

EXTRACT OF ANNUAL RETURN

as on the financial year ended on 31st March, 2019

[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 OTHER DETAILS

i)

CIN

:

U24291MH1923PLC001082

7th September, 1923

ii)

Registration Date

:

iii)

Name of the Company

:

Wimco Limited

iv)

Category / Sub-Category of the Company

:

Unlisted Public Company limited by shares

v)

Address of the Registered office and contact details

:

Indian Mercantile Chambers

R. Kamani Marg, Ballard Estate

Mumbai ¨C 400001

Phone: 022- 4366 3333

Fax: 022- 2269 2228,

E-mail ID : wimcolimited@

vi)

Whether listed company

:

No

vii)

Name, Address and Contact details of Registrar and Transfer Agent, if any

:

The Company provides share registration and related

services in-house.

II.

PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the Company shall be stated:

Sl.

No.

Name and Description of main products / services

NIC Code of the product/

service

% to total turnover of the

Company

1.

Fabrication and assembly of machinery for tube filling, cartoning, wrapping, material

handling, conveyor solutions and engineering services.

28199

100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sl.

No.

1.

Name and Address of

CIN/GLN

Holding/ Subsidiary/

Associate

% of shares held in the

Company

Applicable Section

L16005WB1910PLC001985

Holding company

98.21%

2(46)

the company

ITC Limited

Virginia House,

37 Jawaharlal Nehru Road

Kolkata ¨C 700 071

IV. SHAREHOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

(i) Category-wise Shareholding:

No. of Shares held at the beginning of the year

Category of Shareholders

Demat

Physical

% of Total

Shares

Total

%

Change

during

the

year

No. of Shares held at the end of the year

Demat

Physical

% of

Total

Shares

Total

A. Promoters

(1) Indian

a) Individual/HUF

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

b) Central Govt.

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

c) State Govt.(s)

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

d) Bodies Corp.

18,50,81,193

¨C

18,50,81,193

98.21

18,50,81,193

¨C 18,50,81,193

98.21

Nil

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

¨C

¨C

¨C

N.A.

- 18,50,81,193

98.21

Nil

e) Banks / FI

f) Any Other

¨C

¨C

¨C

¨C

¨C

18,50,81,193

-

18,50,81,193

98.21

18,50,81,193

a) NRIs - Individuals

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

b) Other ¨C Individuals

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

c) Bodies Corp.

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

d) Banks / FI

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

e) Any Other

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

¨C

¨C

¨C

¨C

¨C

¨C

¨C

¨C

N.A.

18,50,81,193

¨C

18,50,81,193

98.21

18,50,81,193

¨C

18,50,81,193

98.21

Nil

Sub-total (A)(1)

(2) Foreign

Sub-total (A)(2)

Total shareholding of Promoter

(A) = (A)(1)+(A)(2)

388

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