AFFLUENCE

  1.     Financial Performance                                                                                                                                (Rs. in Mn)        Particulars Standalone Consolidated FY 2020 FY 2019 % FY 2020 FY 2019 % Revenue from operations     12,615.64     13,735.65 -8%     14,571.70       16,244.30 -10% Other income          182.70          172.49 6%          159.69            163.79 -3% Total revenue   12,798.34   13,908.14 -8%   14,731.39     16,408.09 -10% Earnings Before Interest, tax, Depreciation and amortisation (including exceptional items)       2,255.76       2,858.18 -21%       2,433.07         3,035.32 -20% Finance Charges          537.70          456.92 18%          607.32            509.24 19% Depreciation and amortization          813.47          618.38 32%          939.00            704.88 33% Profit before tax and exceptional items          904.59       1,782.88 -49%          886.75         1,821.20 -51% Exceptional items                  -                    -   0%                  -              156.65 -100% Tax Expenses             82.85          661.12 -87% 84.41 671.42 -87% Profit after tax         821.74     1,121.76 -27%         802.34           993.13 -19% Other comprehensive income/(expense) for the year, net of income tax             (8.01)            (1.72) 366%             (7.78)             (33.78) -77% Minority interest                  -                    -   0% (3.54) 18.44 -119% Total comprehensive income for the year, net of tax          813.73       1,120.04 -27% 798.1 940.91 -15%                                  2.    Company performance   FY 2019-20 can be considered a year of numerous changes for the Automotive industry including but not limited to implementation of BS VI emissions norms, the Government push for faster electrification of vehicles and other related regulatory changes. All of these announcements, coupled with general economic slowdown impacted the overall demand for automobiles across sectors. Demand remained sluggish in the global markets also. This had an impact on the overall sales revenue for the company in both domestic and exports markets. In order to address this situation your company accelerated its drive to strengthen the customer and product portfolio by adopting newer capabilities including aluminium components and introduction of non-engine components to some of its marquee customers. On standalone basis, revenue from operations for the financial year 2019-20 stood at Rs. 12,615.64 million was lower by 8% over last year (Rs. 13,735.65 million in 2018-19) against a 18.2% volume reduction across Indian auto industry (2W -17.8%, PV -17.8%, CV -28.7%). Earnings before interest, tax, depreciation and amortisation (EBIDTA) before extraordinary item was Rs 2,255.76 million lower by 21 % over last year (Rs 2,858.19 million in 2018-19). Profit after tax (PAT) for the year was Rs. 821.74 million against PAT of Rs. 1,121.76 million in 2018-19 which is a de-growth of 27% mainly because of slow down in automotive sector since September 2018. On consolidated basis, revenue from operations for the financial year 2019-20 stood at Rs. 14571.70 million was lower by 10% over last year (Rs 16,244.30 million in 2018-19).  Earnings before interest, tax, depreciation and amortisation before extraordinary item (EBIDTA) was Rs 2,433.07 million which was lower by 20 % over last year (Rs.3,035.32 million in 2018-19). Profit after tax (PAT) for the year was Rs.802.34 million recording a de-growth of 19% over the PAT of Rs 993.13 million in 2018-19. The Company has not taken any deposit from the public during the period under review. For more details, please refer to financial statements along with notes to accounts and Auditors Report. World Health Organization (WHO) declared outbreak of Coronavirus Disease (COVID-19) a global pandemic on March 11, 2020. Consequent to this, Government of India declared lockdown on March 23, 2020 and the Company temporarily suspended the operations in its manufacturing facilities in compliance with the lockdown instructions issued by the Central and State Governments. COVID-19 has impacted the normal business operations of the Company by way of interruption in production, supply chain disruption, unavailability of personnel. closure/lock down of production facilities etc. during the lock-down period which has been extended till mid May 2020.   Management believes that it has taken into account all the possible impacts of known events arising from COVID-19 pandemic and the resultant lockdowns in the preparation of the financial statements including but not limited to its assessment of Group’s liquidity and going concern, recoverable values of its property, plant and equipment, intangible assets, investments, goodwill, inventory and the net realisable values of other assets. However, given the effect of the lockdown on the overall economic activity and in particular on the automobile industry, the impact assessment of COVID-19 on the abovementioned financial statement captions is subject to significant estimation uncertainties given its nature and duration and, accordingly, the actual impacts in future may be different from those estimated as at the date of approval of the financial statements. The Company will continue to monitor any material changes to future economic conditions and consequential impact on its financial statements.   After reporting negligible sales during April and May 2020, the revenue and cash flows were impacted severely during Q1 FY 2021. The Company was however able to navigate this challenging environment without utilizing debt moratorium as stipulated by RBI. Since then, the wholesale demand (OEM to dealers) has recovered sharply resulting in significantly better revenue momentum for the Company. The retail demand (dealers to end customers) however, continues to lag and is expected to pick up over time. With current visibility of additional business from new customers / products, the Company should continue to outperform the broader industry.  

a.            Conservation of energy   Your company ensures that the manufacturing operations are conducted in the manner whereby optimum utilization and maximum possible savings of energy is achieved. Various projects have been taken up during the year.   Some of the projects include optimizing the compressor usage through Sigma Manager Controller, replacement of less efficient air conditioners with centralized water chillers, replacement of less efficient induction motors with high efficient induction motors, replacement of metal allied/CFL lamps with LED lamps etc.   As the impact of measures taken for conservation and optimum utilization of energy are not quantitative, its impact on cost cannot be stated accurately.   In the opinion of the Board, the provisions for disclosure of particulars in terms of Form A are not applicable to the Company.    

a.            Technology absorption   Company's products are manufactured by using in-house know how and no substantial outside technology is being used for manufacturing activities.   The Company constantly strives for maintenance and improvement in quality of its products and entire Research & Development activities are directed to achieve the aforesaid goal      

a.            Foreign exchange earnings and Outgo   During the year, the total foreign exchange used was Rs. 786.93 million and the total foreign exchange earned was Rs. 2951.74 million.    

1.  Directors’ Responsibility Statement   The Directors’ Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, 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 financial year and of the profit and loss 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 this 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; and 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.