As on: May 01, 2025 04:36 AM
DEAR SHAREHOLDERS,
Your Directors take immense pleasure in presenting the Sixty Eighth (68th) Annual Report of the Company together with the Audited Annual Financial Statements (Standalone and Consolidated) showing the financial position of the Company for the Financial Year ended March 31, 2024.
FINANCIAL RESULTS
Summary of the operations of the Company on standalone and consolidated basis for the financial year ended March 31, 2024 is as follows:
REVIEW OF OPERATIONS
On consolidated basis, during the year ended March 31,2024, your Company registered its revenue from Operations of Rs 2,39,547.19 lakhs against Rs 2,22,889.42 Lakhs in the previous financial year 2022-23 delivering a topline growth of 7.47% over previous financial year 2022-23. Net profit after tax of the Company also improved to Rs 27,149.58 Lakhs as against Rs 25,232.80 Lakhs of the previous year, thus delivering a growth of 7.60% over the previous financial year 2022-23.
On a standalone basis, during the year ended March 31,2024, your Company registered its revenue from Operations of Rs 2,28,015.84 Lakhs against Rs 2,11,156.93 Lakhs in the previous financial year 2022-23 delivering a topline growth of 7.98% over previous financial year 2022-23. Net profit after tax of the Company also improved to Rs 26,950.33 Lakhs as against Rs 24,769.58 Lakhs of the previous year, thus delivering a growth of 8.80% over the previous financial year 2022-23.
SETTING UP OF NEW MANUFACTURING PLANT AT Additional BULTIBORI MIDC Industrial AREA-NAGPUR FOR MANUFACUTING OF POWER TRANSMISSION Chains AND RELATED PRODUCTS FOR AUTO AND INDUSTRIAL APPLICATION UNDER Mega PROJECT SCHEME.
During the year under review, the Company has commenced construction of Factory on the allotment of Land at Additional Bultibori MIDC Industrial Area Nagpur for establishment of New Manufacturing Plant for manufacturing of Power Transmission Chains and related Products for Auto and Industrial Application under MEGA Project Scheme.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There was no change in the nature of business of the Company during the Financial Year ended 31st March 2024. TRANSFER TO RESERVES
The Company has transferred an amount of Rs 20,000 Lakhs to the General Reserves out of the current profits available for appropriations and the remaining amount of Rs 12,900.83 Lakhs has been retained in the Surplus in Profit and Loss Account.
DIVIDEND
In line with Dividend Distribution Policy and in recognition of the financial performance during financial year 2023-2024, your Directors are pleased to recommend a dividend of Rs 18/- per equity share on face value of Rs 10/- each i.e., 180 % on the 3,13,92,416 equity shares for the financial year ended March 31, 2024. The dividend, if approved by the shareholders at the ensuing Annual General Meeting of the Company, shall be payable to those Shareholders whose names appear in the Register of Members as on the Record Date i.e. August 22, 2024.
Pursuant to the Finance Act 2020, dividend income is taxable in the hands of the shareholders effective from 1st April, 2020 and the Company is required to deduct tax at source from dividend paid to the members at the prescribed rates as per the Income Tax Act, 1961.
Pursuant to the requirements of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'), the Dividend Distribution Policy of the Company is available on the Company's website at https://www.lgb.co.in/wp-content/uploads/2021/09/LGB- Dividend-Distribution-Policv.Ddf
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND ("IEPF")
Pursuant to the provisions of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time ("the Rules"), all amount of dividends which remains unpaid or unclaimed for a period of 7 years are required to be transferred by the Company to the IEPF Authority. Further, according to the Rules, the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years shall also be transferred to the demat account of the IEPF Authority. Accordingly, the Company has transferred the amount of dividend which remained unclaimed for a period of 7 years in respect of the Financial Year 2015-16 along with 5,093 shares to the Investor Education and Protection Fund (IEPF).
Further, the amount of dividend relating to the financial year 2016-17 which would remain unclaimed after the expiry of seven years would be transferred to the Investor Education and Protection Fund along with underlying equity shares in accordance with the provisions of the Act and its Rules.
The details are also made available on the website of the Company: https://www.lgb.co.in/investor-relations/transfer-of-shares-to-iepf/
SHARE CAPITAL
As on March 31, 2024, the Authorized Share Capital of the Company stood at Rs 47,00,00,000/- divided into 4,70,00,000 equity shares of Rs 10/- each.
The Paid-up Equity Share Capital of the Company as on March 31, 2024 on a non-diluted basis was Rs 31,39,24,160/- divided into 3,13,92,416 equity shares of Rs 10/- each.
During the year, pursuant to the provisions of Sections 23(1)(b), 42, 62(1)(c) and other applicable provisions, if any, of the Companies Act, 2013 (the "Act") read with applicable rules made thereunder and in accordance with provisions of Chapter V of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, the Company has obtained the In-Principle Approval Letter dated 4th March, 2024 of BSE Limited and National Stock Exchange of India Limited, being the Stock Exchange(s) where the Company's equity shares are listed and the approval of the members of the Company by means of a special resolution passed at the Extra-Ordinary General Meeting held on 2nd March, 2024 and had offered and issued 5,00,000 (five lakhs) Warrants, each fully convertible into, or exchangeable for, 1 (one) fully paid-up Equity Share of the Company having face value of Rs 10/- each (Rupees Ten only) within a period not exceeding 18 months ("Warrants"), for cash at a price of Rs 1,292/- (Rupees One Thousand Two Hundred and Ninety Two only) per Warrant (including a premium of Rs 1,282/- per Warrant) ("Warrants Issue Price") to (a) Sri. B. Vijayakumar (Promoter), (b) Smt. Rajsri Vijayakumar (Promoter Group) (c) M/s. L.G.B Auto Products Private Limited (Promoter Group) and (d) M/s. LG Sports Private Limited (Promoter Group) on a preferential basis.
Accordingly, the Company has received the requisite subscription money of an amount equivalent to 25% (twenty five percent) of the Warrants Issue Price and has allotted 5,00,000 Warrants to the Subscriber(s) on 13th March, 2024 on preferential basis and complied with the provisions of the Act and other applicable Regulations made thereunder. The balance consideration of an amount equivalent to 75% (seventy five percent) of the Warrants Issue Price shall be payable by the Warrant Subscribers at the time of exercise of their right attached to the Warrant(s) within a period not exceeding 18 months, to convert or exercise the Warrant(s) and subscribe to Equity Shares of the Company ("Warrant Exercise Amount").
The Company further affirms that there has been no deviation or variation in the utilisation of proceeds of Warrants from the objects stated in the explanatory statement to the Notice of the Extra Ordinary General Meeting held on 2nd March, 2024.
Consequent to the above said allotment of fully convertible warrants, the Paid-up Equity Share Capital of the Company on a fully diluted basis shall be Rs 31,89,24,160/- divided into 3,18,92,416 equity shares of Rs 10/- each.
Other than the above, the Company has not issued shares with differential voting rights, sweat equity shares or any other securities during the year under review.
ANNUAL RETURN
As per the provisions of section 92(3) read with section 134(3)(a) of the Act, the Annual Return for the Financial Year ended on March 31, 2024, in the prescribed Form No. MGT-7 is available on the website of the Company at https://www.lgb.co.in/investor-relations/annual-return-mgt-7/.
MEETINGS OF THE BOARD AND ITS COMMITTEES
The Board has met 6 times during the Financial Year 2023-24. Further, the details of the meetings of the Board and Committees thereof held during the said period are provided in the Corporate Governance Report, which forms part of this Integrated Annual Report. The Intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").
STATEMENT ON COMPLIANCE OF APPLICABLE SECRETARIAL STANDARDS
The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively. The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on the meeting of the Board of Directors (SS-1) and General Meetings (SS-2).
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013, the Board of Directors confirm that, to the best of their knowledge and belief:
a) that in the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;
b) that 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 as at the end of the financial year and of the profit of the Company for that period;
c) that 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) that the Directors had prepared the Annual Accounts on a going concern basis;
e) that the Directors had laid down proper internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f) that 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.
DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB-SECTION (12) OF SECTION 143 OTHER THAN Those Which ARE REPORTABLE TO The CENTRAL GOVERNMENT
During the year under review, there were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.
DECLARATION OF INDEPENDENT DIRECTORS
The Company has received declarations from all the Independent Directors of the Company to the effect that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 read with Schedules and Rules issued thereunder and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and that their name is included in the data bank as per Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014 (as amended).
STATEMENT Regarding OPINION OF THE BOARD WITH Regard TO Integrity, EXPERTISE AND EXPERIENCE (Including THE PROFICIENCY) OF THE INDEPENDENT DIRECTORS
The Board of Directors has evaluated the performance of the Independent Directors during the year 2023-24 based on the criteria and framework adopted by the Board and opined that the integrity, expertise and experience (including proficiency) of the Independent Directors was satisfactory.
COMPANY'S POLICY RELATING TO DIRECTORS' APPOINTMENT, PAYMENT OF REMUNERATION AND OTHER MATTERS PROVIDED UNDER SECTION 178(3) OF THE COMPANIES ACT, 2013
The Board, on the recommendation of the Nomination and Remuneration Committee, has formulated a policy which covers selection and appointment of Directors, Key Managerial Personnel, Senior Management and the criteria for payment of their remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Section 178(3) of the Act and SEBI Listing Regulations. The salient features of the Nomination and Remuneration Policy of the Company is annexed herewith as Annexure I and the full policy can be accessed on the Company's website at https://www.lgb.co.in/wD-content/uploads/2022/07/Nomination-Remuneration-Policy.Ddf.
COMMENTS ON AUDITORS' REPORT
There were no qualifications, reservations, adverse remarks or disclaimers made by M/s. Suri & Co., Chartered Accountants (Firm Registration No. 004283S), Statutory Auditors, in their report for the year ended March 31, 2024.
With respect to the observations made by M/s. MDS & Associates LLP, Company Secretaries, Coimbatore, the Secretarial Auditors of the Company in their report for the year ended March 31, 2024, which are self-explanatory, your Directors wish to state that necessary steps has been initiated to ensure compliance with all applicable statutory requirements.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION186 OF THE COMPANIES ACT, 2013
The Company has not granted any loans or given guarantees or provided securities falling within the purview of Section 186 of the Companies Act, 2013 during the year under review. The details of investments made pursuant to the provisions of Section 186 of the Companies Act, 2013 have been disclosed in the notes to the financial statements.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES
All related party transactions as defined under the Companies Act, 2013 and Regulation 23 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 which were entered during the Financial Year were in the ordinary course of business and on an arm's length basis. Since there are no related party transactions which are material in nature, the disclosure in Form AOC- 2 does not arise. However, the details of all transactions with related parties have been disclosed in Notes to the Financial Statements forming an integral part of this Report.
In accordance with the requirements of the Listing Regulations, the Company has also adopted Policy on Materiality and dealing with Related Party Transactions and the same has been placed on the website of the Company at https://www.lgb.co.in/investor-relations/related-party-transaction/
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
There have been no material changes and commitments affecting the financial position of the Company since the end of the financial year till the date of this report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule, 8 of the Companies (Accounts) Rules, 2014, as amended from time to time, is annexed herewith as "ANNEXURE-A".
RISK MANAGEMENT POLICY
The Company has formulated an Enterprise Risk Management policy in accordance with the recommendations of the Risk Management Committee of the Board of Directors, and pursuant to Regulation 21 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Risk Management Charter and Policy institutionalize a formal risk management function and framework consisting of risk identification and risk management process, risk governance and communication structure.
The Company has also laid down procedures to inform the Audit Committee as well as the Board of Directors about risk assessment and management procedures.
The Risk Management policy provides a structured, consistent, and continuous process across the whole organization for identifying and assessing risk, deciding on mitigations, and reporting on the opportunities and threats that may affect the achievement of its strategic objectives. The Policy is available on the website at https://www.lgb.co.in/wp-content/uploads/2021/08/risk-management-policy.pdf.
DETAILS ABOUT THE POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON CORPORATE SOCIAL RESPONSIBILITY INITIATIVES
Your Company believes that corporates have a significant role to play in bringing about social change. And your Company has kept its social and development mandate flexible and responsive to development challenges. Your Company's Corporate Social Responsibility strategy has evolved to focus on areas it sees as key for positive change.
Pursuant to the provisions of Section 135 of the Companies Act, 2013, the Company has constituted a Corporate Social Responsibility Committee and has adopted a Corporate Social Responsibility (CSR) Policy. The detailed composition of the CSR Committee, number of meetings held during the year under review and other related details are set out in the Corporate Governance Report which forms part of this Report. The Company's CSR policy is available on its website at https://www.lgb.co.in/wp-content/uploads/2023/08/Corporate-Social- ResDonsibilitv-Policv.Ddf.
As a part of its CSR initiatives, the Company has undertaken various projects in accordance with Schedule VII of the Companies Act, 2013 and the Company's CSR policy. The Annual Report on CSR activities in terms of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as "Annexure- B" and forms a part of this report.
ANNUAL EVALUATION OF The PERFORMANCE OF The BOARD, ITS COMMITTEES AND OF INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Act and SEBI Listing Regulations the annual evaluation of the performance of the Board, its Committees and of every Directors individually has been carried out based on a structured questionnaire, formulated in accordance with the performance evaluation criteria approved by the Nomination and Remuneration Committee.
The Board's own performance was evaluated based on certain parameters like structure, governance, dynamics and functioning and review of operations, financials, internal controls etc. The Committees of the Board were evaluated based on the terms of reference specified by the Board.
The performance of the individual Directors including Independent Directors were evaluated based on the criteria laid down under the Nomination and Remuneration Policy and the Code of Conduct as laid down by the Board.
Further, the Independent Directors has met on March 16, 2024 and evaluated the performance of the Board as a whole, its Chairman and Non-Executive Non-Independent Directors and considered other items as stipulated under Schedule IV of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The criteria for evaluation of the performance of the Non-Executive Directors and Independent Directors have also been explained in the Corporate Governance Report annexed to this Report.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In pursuance of the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Smt. Rajsri Vijayakumar (DIN: 00018244) and Sri. P. Prabakaran (DIN: 01709564), retires by rotation at the ensuing Annual General Meeting of the Company and being eligible, they have offered themselves for re-appointment. Your Directors recommends their re-appointment.
Based on the recommendation of the Nomination and Remuneration Committee, the Board of Directors, at their meeting held on April 29, 2024, has recommended the appointment of Sri. J. Dinesh Kumar (DIN: 10586227) as a Non-Executive Independent Director to hold such office for a first term of 5 consecutive years effective from September 01, 2024 for the approval of the members of the Company at the ensuing 68th Annual General Meeting by way of passing a special resolution in accordance with the provisions of Section 149 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Company has also received necessary consent and declaration from the appointee Independent Director that he fulfils the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 read with Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Accordingly, necessary special resolution is included in the notice of the ensuing 68th Annual General Meeting for the approval of the members. Your Directors recommends his appointment.
Based on the recommendation of the Nomination and Remuneration Committee and the approval of the Audit Committee, the Board of Directors, at their meeting held on April 29, 2024, has approved the re-appointment of Sri. B. Vijayakumar (DIN: 00015583), aged 71 years, as Executive Chairman of the Company for a further period of 5 (five) years with effect from January 01, 2025 and the remuneration payable to him, subject to the approval of the members by means of passing a special resolution. Accordingly, necessary special resolution has been included in the Agenda of the Notice of the Sixty Eighth Annual General Meeting of the Company. Your Directors recommends for his re-appointment.
Based on the recommendation of the Nomination and Remuneration Committee and the Board of Directors and pursuant to the approval of the members by means of passing a special resolution at their Extra-Ordinary General Meeting held on March 02, 2024, Mrs. Kanchana Manavalan (DIN: 07497403) was re-appointed as an Independent Director for the second term of 5 (five) consecutive years with effect from January 31, 2024 and complied with the provisions of the Act.
Based on the recommendation of the Nomination and Remuneration Committee and the Board of Directors and pursuant to the approval of the members by means of passing a special resolution at their Extra-Ordinary General Meeting held on March 02, 2024, Sri.G.D.Rajkumar (DIN: 00197696) was re-appointed as an Independent Director for the second term of 5 (five) consecutive years with effect from April 29, 2024 and complied with the provisions of the Act.
The Board is of the opinion that Mrs. Kanchana Manavalan (DIN: 07497403) and Sri.G.D.Rajkumar (DIN: 00197696), the Independent Directors, possess the requisite integrity, experience and expertise (including the proficiency).
Based on the recommendation of the Nomination and Remuneration Committee and the approval of the Audit Committee and the Board of Directors, the members at their Extra-Ordinary General Meeting held on March 02, 2024 has approved the re-appointment of Sri.P.Prabakaran (DIN:01709564), who will attain the age of 70 (seventy) years during the year 2029, as Managing Director of the Company for a further period of 5 (five) years with effect from June 1, 2024 and the remuneration payable to him by means of passing a special resolution and complied with the provisions of the Act.
Based on the recommendation of the Nomination and Remuneration Committee and the approval of the Audit Committee and the Board of Directors, the members at their Extra-Ordinary General Meeting held on March 02, 2024 has approved the re-appointment of Sri. Rajiv Parthasarathy (DIN: 02495329) as an Executive Director of the Company for a further period of 5 (five) years with effect from August 01, 2024 and the remuneration payable to him by means of passing a special resolution and complied with the provisions of the Act.
Other than the above, there is no change in the composition of the Board of Directors and Key Managerial Personnel of the Company.
The following are the Key Managerial Personnel of the Company as on March 31, 2024 and as on the date of this Report:
Sri.B.Vijayakumar (DIN: 00015583), Executive Chairman
Sri.P.Prabakaran (DIN:01709564), Managing Director
Sri.Rajiv Parthasarathy (DIN: 02495329), Executive Director
Sri.N.Rengaraj, Chief Financial Officer
Sri.M.Lakshmikanth Joshi, Senior General Manager (Legal) and Company Secretary & Compliance Officer
SUBSIDIARY COMPANIES, JOINT VENTURES AND ASSOCIATE COMPANIES
As of March 31, 2024, the Company has four subsidiaries viz., LGB USA INC, (Direct Overseas Subsidiary), GFM Acquisition LLC (Step down overseas subsidiary), GFM LLC (Step down overseas subsidiary) and RSAL Steel Private Limited (Wholly owned subsidiary). The Company has laid down policy on material subsidiary and the same is placed on the website https://www.lgb.co.in/wD-content/uDloads/2021/08/Dolicv-for-determining-material- subsidiaries.pdf
None of the subsidiaries are material subsidiary for the financial year ended 31st March 2024 as per the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The Company does not have any Joint Ventures or Associate Companies during the reporting period.
COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR - ACQUISITION OF RSAL STEEL PRIVATE LIMITED AS WHOLLY OWNED SUBSIDIARY UNDER CORPORATE INSOLVENCY RESOLUTION PROCESS ("CIRP")
The Company had submitted a Resolution Plan ("Resolution Plan") for acquisition of RSAL Steel Private Limited ("RSPL") under the Corporate Insolvency Resolution Process ("CIRP") in terms of the Insolvency and Bankruptcy Code, 2016 (the "IBC"). Accordingly, the Resolution Plan submitted by the Company was approved by the Hon'ble National Company Law Tribunal, Mumbai Bench, Court-II ("NCLT"), vide its Order dated 9th January, 2024 and the said Resolution Plan has become effective from the said date.
Further, in terms of the approved Resolution Plan and in compliance with the order of the Hon'ble NCLT, Mumbai, the conditions precedents as contemplated under the approved Resolution plan were achieved on 07.02.2024 including the release of the entire payments by the LGB as proposed under the approved Resolution Plan. Accordingly, in terms of the approved Resolution Plan M/s. RSAL Steel Private Limited stands 100% wholly Owned Subsidiary of L.G.Balakrishnan & Bros Limited as on February 13,2024.
RSAL primarily engaged in the Manufacturing of cold rolled close annealed (CRCA) strips which constitute a large portion of the raw materials for manufacturing these chains which is helpful for LGB's captive requirement.
Further, none of the Company / Body Corporate have ceased to be a subsidiary of LGB during the year under review.
ANNUAL ACCOUNTS OF SUBSIDIARIES
In accordance with Section 129(3) of the Act read with rules made thereunder, a statement containing salient features of the financial position of Subsidiaries is given in Form AOC-1 attached as an "ANNEXURE C" forming integral part of this Report. As required under Section 134 of the Act, the said form also highlights the performance of the subsidiaries.
The consolidated financial statements of the Company and its subsidiaries prepared in accordance with the applicable accounting standards have been annexed to the Annual Report. Further, in accordance to the provisions of Section 136(1) of the Act, the annual accounts of the subsidiary Company have been placed on the website of the Company at https://www.lgb.co.in/investor-relations/annual-reports/
DEPOSITS
Pursuant to the provisions of Section 73 to 76 of the Companies Act, 2013 read with its relevant Rules governing deposits, the Company has obtained the approval of its members by way of passing a Special Resolution at the Annual General Meeting held on 10.09.2015 for inviting/ accepting/ renewing deposits from Members and public within the limits prescribed under the Companies Act, 2013 and the rules framed there under.
As of March 31 2024, the deposits accepted by the Company from public and shareholders aggregated to Rs 1507.19 Lakhs, which are within the limits prescribed under the Companies Act, 2013 and the rules framed there under.
Further, in accordance with the provisions of the Companies Act, 2013 read with relevant Rules made thereunder, your Company has obtained a credit rating "ICRA AA"(stable) for its fixed deposit from ICRA Limited ("Credit Rating Agency").
The details relating to deposits covered under Chapter V of the 2013 Act are given here under:
The details of deposits which are not in compliance with the requirements of Chapter V of the Act Nil
In accordance with Rule 16A of the Companies (Acceptance of Deposits) Rules, 2014, the monies received from the Directors, if any, has been disclosed under relevant notes to the Financial Statements.
DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS impacting THE going CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No significant or material orders were passed, during the period under review, by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company maintains an effective Internal Control System commensurate with its size and complexity, providing reasonable assurance of authorised and accurately recorded transactions. An independent Internal Audit function, coupled with extensive internal audits and periodic reviews, ensures the adequacy of internal control systems. Your Company remains committed to minimising identified risks through continuous monitoring and mitigating actions. During the Financial Year, such controls were tested and no reportable material deficiency in controls were observed. Internal Financial Controls are evaluated, and Internal Auditors' Reports are regularly reviewed by the Audit Committee of the Board.
Statutory Auditors Report on Internal Financial Controls as required under Clause (i) of Sub-Section 3 of Section 143 of the Companies Act, 2013 ("the Act") is annexed with the Independent Auditors' Report.
STATUTORY AUDITORS
As per Section 139 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the Members of the Company, at their 66th Annual General Meeting (‘66th AGM') held on August 25, 2022, had approved the re-appointment of M/s.Suri & Co, Chartered Accountants (Firm Registration No. 004283S), as the Statutory Auditors of the Company to hold such office for a second term of five consecutive years from the conclusion of 66th AGM till the conclusion of 71st AGM to be held during the year 2027. Accordingly, no resolution for appointment of statutory auditors is included in the Notice convening the 68th Annual General Meeting.
The Statutory Auditors have also confirmed that they have subjected themselves to the peer review process of the Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI. The Company has also obtained necessary consent under Section 139 and eligibility certificate under Section 141 from the Statutory Auditors to the effect that their appointment is in conformity with the provisions of the Companies Act, 2013.
SECRETARIAL AUDITORS
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and its relevant rules made thereunder and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors had appointed M/s. MDS & Associates LLP (ICSI Peer Review No.3030/2023), Company Secretaries, Coimbatore as Secretarial Auditors for the Financial Year 2023-24. Accordingly, the Secretarial Audit Report for the financial year ended March 31, 2024 is annexed herewith as "Annexure - D" to this Report.
Further, the Secretarial Auditors have also confirmed that they have subjected themselves to the peer review process of the Institute of Company Secretaries of India (ICSI) and hold a valid certificate issued by the Peer Review Board of the ICSI.
COST AUDITOR AND MAINTENANCE OF COST RECORDS
The Company has made and maintained cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013 and accordingly such accounts and records are maintained by the Company.
The Board of Directors, on the recommendation of Audit Committee, has re-appointed Dr.G.L. Sankaran (Membership No.4482) as Cost Auditor to audit the cost accounts of the Company for the financial year 2024-25 and approved the remuneration payable to him. As required under the Companies Act, 2013 a resolution seeking Members' ratification for the remuneration payable to the Cost Auditor forms part of the notice convening the 68th Annual General Meeting. Your Directors recommends the ratification of the remuneration payable to the Cost Auditor.
The Cost Audit Report for FY 2023-2024 will be filed with the Central Government within the timeline stipulated under the Companies Act, 2013.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013
Your Company firmly believes in providing a safe, supportive and friendly workplace environment - a workplace where our values come to life through the supporting behaviors. Positive workplace environment and a great employee experience are integral part of our culture. Your Company continues to take various measures to ensure a workplace free from discrimination and harassment based on gender. The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. Also, the Company has complied with the provisions relating to the constitution of Internal Complaints Committee. The Company has not received any complaints on sexual harassment during the year under review and there are no unresolved complaints as on March 31, 2024.
DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER The INSOLVENCY AND BANkRUPTCY CODE, 2016 During THE YEAR
The Company has not made any application or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 ("IBC Code") during the Financial Year and does not have any proceedings related to IBC Code.
DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAklNG LOAN FROM THE BANkS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF
The Company has not made any onetime settlement during the Financial Year 2023-24 with Banks or Financial Institution and hence, the disclosure under this clause is not applicable.
DISCLOSURE UNDER SECTION 197(12) AND RULE 5 OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014
The requisite details relating to ratio of remuneration, percentage increase in remuneration etc., as stipulated under Section 197(12) and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as "ANNEXURE-E" to this Report.
Further, a statement showing the names and other particulars of top ten employees in terms of remuneration drawn and of employees drawing remuneration in excess of the limits required under Section 197(12) of the Act read with Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as "ANNEXURE-F" and forms part of this Report.
MANAGEMENT DISCUSSION & ANALYSIS
As per the requirement of Regulation 34(2) (e) and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a detailed Management Discussion and Analysis Report is annexed as "ANNEXURE - G" and forms part of this Annual Report.
CORPORATE GOVERNANCE REPORT
Your Company reaffirms its commitment to the highest standards of corporate governance practices. The Company follows the principles of Corporate Governance in letter and spirit. A detailed Corporate Governance Report ("CG Report") as stipulated under Regulation 34(3) read with Part C of Schedule V of the Listing Regulations is forming part of this Annual Report. The requisite certificate from Mr. M. D. Selvaraj (FCS: 960 / COP: 411), Managing Partner of M/s. MDS & Associates LLP (ICSI Peer Review No.3030/2023), Company Secretaries, Coimbatore confirming compliance with the conditions of corporate governance is attached to the CG Report as "ANNEXURE H".
AUDIT COMMITTEE
As provided in Section 177(8) of the Act and Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors has constituted an Audit Committee. The detailed information about composition of Audit Committee and other details are given in the Corporate Governance Report, which forms a part of the Annual Report. During the year under review, the Board has accepted all the recommendations of the Audit Committee.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
As per the provisions of Section 177(9) of the Act and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company is required to establish a Vigil Mechanism for Directors and employees to report genuine concerns. The Company has a Policy for Prevention, Detection and Investigation of Frauds and Protection of Whistleblowers ("the Whistleblower Policy") in place and the details of the Whistleblower Policy are provided in the Report on Corporate Governance forming part of this Report. The Company has disclosed information about the establishment of the Whistleblower Policy on its website https://www.lgb.co.in/wp- contentluploadsl2021l08lwhistle-blower-policy.pdf .
LISTING OF EQUITY SHARES
The Company's Equity Shares continue to be listed on National Stock Exchange of India Limited and BSE Limited ("Stock Exchanges") and the details of listing have been given in the Corporate Governance Report forming part of this Directors' Report. We confirm that the Listing fee for the Financial Year 2024-2025 has been paid to the Stock Exchanges within the stipulated time.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Pursuant to Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the initiatives taken by the Company from an environmental, social and governance perspective, are provided in the Business Responsibility and Sustainability Report which is annexed as "ANNEXURE I" and forms an integral part of the Annual Report.
HUMAN RESOURCE
LGB recognises its workforce as an essential resource that makes an invaluable contribution to the Company's growth. Apart from the traditional responsibilities of the HR department, such as ensuring equitable benefits and compensation, overseeing employee engagement and retention, enhancing diversity, and handling workplace issues, the Company has remained committed to the safety of all its employees and partners. All necessary precautions and safety measures were implemented by the Company, across all its locations.
Employee relations continued to be cordial and harmonious across all levels and across all its locations of the Company.
INSURANCE
The Company's plants, properties, equipment's and stocks are adequately insured against all major risks. The Company has insurance cover for product liability. The Company has also taken Directors' and Officers' Liability Policy to provide coverage against the liabilities arising on them.
ACKNOWLEDGEMENT
Your Directors acknowledge with gratitude the Trust, Faith and Co-operation and assistance received from the Shareholders, Bankers, Customers, Vendors and Other Business Associates, as well as the Employees and other stake holders and look forward to their continued support.