Dear Shareholders
The Board of Directors present their Report together with the Audited
Financial Statements of CIE Automotive India Limited (Formerly known as Mahindra CIE
Automotive Limited) (the Company) for the Financial Year (fy) ended 31st
December, 2023.
A. FINANCIAL SUMMARY AND HIGHLIGHTS
(' in Million)
PARTICULARS |
FY ended |
FY ended |
(STANDALONE) |
31st December, |
31st December, |
|
2023 |
2022 |
Total Income |
47,202 |
45,184 |
Profit before Interest,
Depreciation, Exceptional Items and Tax |
8,632 |
7,422 |
Less: Depreciation |
1,357 |
1,332 |
Profit before Interest,
Exceptional Items and Tax |
7,275 |
6,090 |
Less: Finance cost including
interest |
110 |
135 |
Profit before Exceptional
Items and Tax |
7,165 |
5,955 |
Less: Exceptional items |
- |
(379) |
Profit before tax |
7,165 |
6,334 |
Profit after tax |
5,623 |
5,120 |
During the Financial Year under review, total standalone revenue of the
Company increased to ' 47,202 Million from ' 45,184 Million for the previous year. Profit
before Interest, Depreciation, Exceptional Items and Tax increased to ' 8,632 Million as
against ' 7,422 Million for the previous year. The profit before exceptional items &
tax for the Financial Year increased to ' 7,165 Million in the Financial Year 2023 from '
5,955 Million in the Financial Year 2022.
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 to which the financial statements relate and the date of this Report.
Dividend
As per the Dividend Distribution Policy of the Company, dividend
pay-out will be determined based on available financial resources, business environment,
funds required for organic as well as inorganic growth and other factors
which will ensure optimal shareholder return. Within these parameters,
the Company would endeavour to maintain a total dividend pay-out ratio of upto 25% of the
Annual Consolidated Profit After Tax (Consolidated PAT) of the Company for the
corresponding year.
Considering strong cash flows and operational performance, the internal
and external factors as provided in the Dividend Distribution Policy, the Board is pleased
to recommend dividend of ' 5/- (Rupees five only) per equity share of face value of ' 10/-
for the financial year ended 31st December, 2023 out of the standalone profit
after tax of the Company for the Financial Year ended 31st December, 2023. The
equity dividend outgo for the Financial Year 2023 would absorb a sum of ' 1,897 Million.
Dividend will be payable subject to approval of members at the ensuing
Annual General Meeting and deduction of tax at source, as may be applicable, to those
members whose names appear in the Register of Members as on the close of business hours of
13th June, 2024.
Transfer to Reserves
The Board of Directors has decided not to transfer any amount to the
General Reserve for the year under review.
B. OPERATIONAL PERFORMANCE - THE COMPANY AND SUBSIDIARIES
India
Automotive market growth in India in CY23 was uneven across segments,
quarters and customers. Light vehicles grew reasonably but two wheelers and tractors were
flattish. A good first quarter was followed by a muted second quarter, but the festive
season was encouraging. The performance of our key customers was also mixed with some
suffering negative or flat demand growth. There was delay in ramp up of some of our orders
and this impacted our sales growth. To safeguard margins and returns, the focus was on
increasing labour productivity through smart automation and improving asset utilisation by
optimising working capital, enhancing machine throughput and focusing on flexible
machines. To keep expanding the order book, emphasis was on improving new product
development with higher value add and the skills required for it.
Europe
The light vehicle market in Europe grew in double digits in CY23 driven
by pent up demand but demand for off road vehicles declined especially in US which is a
key market for our gear's unit. The ongoing war in Ukraine and the tense situation in
Israel continues to cast a shadow on European customer outlook. Power costs in Europe
stabilised and this helped in recovering margins to levels seen before the energy crisis
that was triggered in the last quarter of CY21. But pressure on costs continues to be a
concern. The endeavour is to maintain margins and focus on cash generation in Europe. Our
Forgings Business in Europe is a
leading producer of crankshafts for internal combustion engines and
this business will decline in the long-term with the increasing penetration of electric
vehicles in Europe. However, the delay in the Euro 7 norm entry will maintain current
internal combustion engine volumes in the mid-term. For our Forgings Business in Europe we
are developing aluminum forgings as an alternative to crankshafts. In addition, it has a
healthy order book on steel forgings and transmission parts specific to electric vehicles.
C. INVESTOR RELATIONS (IR)
The Company strives for excellence in its investor relations
("IR") engagement with international and domestic investors. There is a
structured conference call every quarter to discuss published results. The management has
periodic interactions with the financial community including investors and analysts,
through individual meetings and investor conferences. The Company participated in several
investors meets, conferences and roadshows organized by reputed global and domestic
broking houses, during the year. It is ensured that critical information related to the
company is uploaded on the company's website and made available to the stock exchanges so
that they can be accessed easily and equally by all.
D. CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Total Income of the Company (from continued
operations) for the financial year under review stood at ' 93,623 Million as against '
88,113 Million in the previous year. Profit before Interest, Depreciation, Exceptional
Items and Tax (from continued operations) for the financial year under review stood at '
15,059 Million as against ' 12,302 Million for the previous year. The profit before
exceptional items & tax for the Financial Year (from continued operation) stood at '
10763 Million in Financial Year 2023 as against ' 9,113 Million in Financial Year 2022.
The subsidiary companies continue to contribute to the overall growth
of the Company.
CIE Galfor S.A. registered consolidated revenue from continued
operations of ' 33,818 Million during the financial year ended 31st December,
2023 as compared to ' 31,220 million in the previous year. The consolidated net profit
after tax from continued operations for the financial year under review was ' 3,065
Million as compared to ' 2,316 Million in the previous year.
CIE Aluminium Casting India Limited (formerly known as Aurangabad
Electricals Limited), registered a revenue from operations of ' 10,316 Million during the
year as compared to ' 10,060 Million in the previous year and the net profit after tax for
the year stood at ' 791 Million as compared to ' 730 Million in the previous year.
CIE Hosur Limited registered a revenue from operations of ' 1,134
Million during the year and the net loss after tax for the year stood at ' 141 Million.
The Company's consolidated revenue from the continuing operations was '
92,803 Million in the financial year ended 31st December, 2023, of which about
50.7% was derived from the subsidiaries whereas about 49.3% was derived from operations of
the Company.
The Consolidated Financial Statements of the Company and its subsidiary
companies, prepared in accordance with the Companies Act, 2013 (hereinafter referred to as
"the Act") and applicable Accounting Standards along with all relevant
documents and the Auditors' Report forms a part of the Annual Report of 2023.
In accordance with Section 136 of the Act, separate annual accounts in
respect of each of the Subsidiaries are uploaded on the website of the Company and is
accessible at the web-link: https://www.cie-india.com/ subsidiaries-annual-reports.html
and soft copies of the same shall be provided to shareholders of the Company on request
for such copies.
Subsidiary Companies
As on 31st December 2023, the Company has 9 subsidiaries
namely CIE Galfor S.A.U. (Spain), CIE Legazpi S.A. (Spain), UAB CIE LT Forge (Lithuania),
CIE Forging Germany GmbH (Germany), Metalcastello S.p.A. (Italy), Bill Forge de Mexico S.
A. de. CV (Mexico), BF Precision Private Limited (India), CIE Aluminium Casting India
Limited (Formerly known as Aurangabad Electricals Limited) (India) and CIE Hosur Limited
(India).
Except CIE Forging Germany GmbH and BF Precision Private Limited, all
other subsidiaries are operational.
CIE Forging Germany GmbH and its subsidiaries (German Forging
Operations)
The Board of Directors of CIE Galfor S.A. at its meeting held on 14th
December, 2022 had approved the proposal to launch an active program to locate a buyer for
the German Forging Operations comprising of CIE Forging Germany GmbH (CFG) and its
subsidiaries namely Jeco Jellinghaus GmbH (JECO), Gesenkschmiede Schneider GmbH (GSA),
Falkenroth Umformtechnik GmbH (FUG) and Schoneweiss & Co. GmbH (SCG) (together
referred to as German Forging Operations). In accordance with the applicable accounting
standards all the German Forging Operations' "assets and liabilities" were
categorized as "assets and liabilities held for sale".
The Board of the Company at its meeting held on 10th August,
2023 reviewed the proposal of sale of 100% stake held by CFG in its subsidiaries in
Germany i.e. JECO, GSA, FUG and SCG to Mutares SE & CO (Buyer) (the Transaction) and
accorded its approval to the Transaction. CFG as seller of JECO, GSA, FUG and SCG and the
Buyer entered into binding agreements to give effect to the Transaction.
Further, the members of the Company accorded their approval to the
Transaction in accordance with Regulation 24(5) of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "the Listing
Regulations") through Postal Ballot on 22nd September, 2023.
percentage shareholding of the Company in BF Mexico will get diluted
such that, BF Mexico will cease to be a direct subsidiary of the Company. BF Mexico shall
become a direct subsidiary of Galfor and a step down subsidiary of the Company.
Associate Companies
The Company had Seven Associates as on 31st December, 2023
namely Clean Max Deneb Power LLP (Deneb), Sunbarn Renewables Private Limited (Sunbarn),
Renew Surya Alok Private Limited (Renew), Gescrap India Private Limited (Gescrap),
Strongsun Solar Private Limited (Strongsun), Sunseed Solar Private Limited (Sunseed) and
Galfor Eolica SL. The Company does not have any joint-venture.
The Company has been taking various steps to optimize its power cost
and to increase the proportion of green energy in the total energy consumption of the
Company. The investments in Deneb, Sunbarn, Strongsun, Renew and Sunseed are in
furtherance of this objective. All these entities are major contributors for use of
renewable source of energy in operations of the Company and its subsidiaries in India and
will also results in savings in energy cost.
Gescrap is engaged in metal recycling and total waste management in
India. The investment is made with the objective of preventing disruption in supply/demand
of scrap for the business divisions of the Company and to enhance transparency and add
best practices to scrap management in the group.
Sunseed Solar Private Limited is an Associate of CIE Aluminium Casting
India Limited w.e.f. 4th July 2023. Galfor Eolica S.L. is an associate Company
of CIE Galfor S.A.
A Report on the performance and financial position of each of the
subsidiaries and associate companies is included in the Consolidated Financial Statement
and their contribution to the overall performance of the Company is provided in Note No.
39 of the Consolidated Financial Statements of the Company and in Form AOC-1 attached to
the Financial Statements.
The Company has formulated a Policy for determining Material
Subsidiaries and Governance Requirements in respect of Subsidiaries and the same has been
uploaded on the website of the Company and is accessible at the web-link:
https://www.cie-india.com/governance3.html#Policies
Credit Rating
During the year under review ICRA Limited, a Credit Rating Agency, have
re-affirmed its rating(s) to the Commercial Paper and short term-Fund based/Non Fund based
line of credit as [ICRA]A1+ (pronounced as ICRA A one plus). The rating for long term-fund
based/non-fund based Line of Credit was upgraded to [ICRA]AA (pronounced ICRA double A)
from [ICRA]AA- (pronounced ICRA double A minus) while the outlook on long term rating was
revised to Stable from Positive.
On 16th October, 2023 in terms of the transaction documents,
all the necessary actions required for completion of the Transaction were completed and
all the shares held by CFG in each of JECO, GSA, FUG and SCG were transferred to the
Buyer. Accordingly, effective from 16th October, 2023 JECO, GSA, FUG and SCG
ceased to be subsidiaries of the Company. While the transaction was completed on 16th
October, 2023, in terms of the transaction document, the transfer of business of JECO,
GSA, FUG and SCG to the Buyer takes effect from 1st July, 2023 i.e. the
business and operations including the revenue, profits & cash generated therefrom
belongs to the Buyer w.e.f. 1st July, 2023.
Stokes Group Limited
In 2018, the Board of Directors of the Company, after reviewing the
business situation, had agreed with the proposed closure of Stokes Group Limited (Stokes)
and its business was classified as dis-continued operations. Stokes had completely stopped
its production in FY2019 and a process of voluntary winding up and liquidation of Stokes
was initiated. The said process was completed and Stokes was dissolved with effect from 5th
September, 2023 in accordance with applicable laws and it ceased to be a subsidiary of the
Company from that date.
BF Precision Private Limited (BFPPL)
BFPPL was set-up as a separate entity by erstwhile Bill Forge Private
Limited (now merged with the Company) as per its business strategy in the year 2016. It
continued to have a single plant in Coimbatore, that continued to cater to a single
customer, which can also be catered from our other locations, if any. The premises at
which the plant of BFPPL was set-up was a leased premises and the said lease was expiring
in September 2023. Accordingly, the Board of Directors of the Company at its meeting held
on 18th July, 2023 reviewed the overall operations of BFPPL. Continuing
operations with a separate plant with such small operations and under a separate legal
entity was not in line with the Group strategy of keeping the Group Entity structure
simplified. Hence instead of continuing with such operations, the Board, agreed and
approved the Plan to close the operations of BFPPL. Accordingly, the operations of BFPPL
were closed in September, 2023.
Further the Board of Directors at its meeting held on 19th
February, 2024 has approved the proposal to launch a process of voluntary liquidation of
BFPPL.
Bill Forge de Mexico S. A. de. CV (BF Mexico)
The Board of the Company at its meeting held on 19th
February, 2024 reviewed and approved the proposal to increase the capital of Bill Forge De
Mexico, S.A. DE C.V. (BF Mexico) and waived its right of first refusal to subscribe to the
said capital increase. The Board also noted that CIE Galfor S.A.U (Galfor), the other
wholly owned subsidiary of the Company in Spain, shall subscribe to the said capital
increase.
Accordingly, on issuance of shares to Galfor by BF Mexico, pursuant to
the proposed capital increase, the
The details of the Credit Ratings are uploaded on the website of the
Company and is accessible at the web- link:
https://www.cie-india.com/periodic-public-
information8.html#Credit-Rating
The Company has not been identified as a "Large Corporate" as
per the criteria specified under Chapter XII of SEBI operational circular no.
SEBl/HO/DDHS/p/ CIR/2021/613 dated 10th August 2021.
E. INTERNAL FINANCIAL CONTROLS
The Company has put in place adequate internal financial controls
commensurate with the size and complexity of its operations. The internal controls ensure
the reliability of data and financial information and accountability of assets.
The Company uses ERP System as a business enabler and to maintain its
books of accounts. The transactional controls built in ERP System provide segregation of
duties, appropriate level of approval mechanism and maintenance of supporting records. It
is further supplemented by documented policies, guidelines and procedures. These are
reviewed by the management regularly and strengthened wherever required. These systems and
controls are subject to internal audit program arrived at basis risk review as approved by
the Audit Committee. Action plan is prepared by the management for all the audit findings
and the same is reviewed by the Audit Committee on quarterly basis.
The controls have been assessed during the year under review, basis
guidance note issued by the Institute of Chartered Accountants of India on Audit of
Internal Financial Controls over Financial Reporting. Based on the results of such
assessments carried out by the management, no reportable or significant deficiencies, no
material weakness in the design or operation of any control was observed. Nonetheless, the
Company recognizes that any internal control framework, no matter how well designed, has
inherent limitations and in a dynamic environment needs continuous review and upgrade.
F. MANAGEMENT DISCUSSION AND ANALYSIS
Management discussion and analysis of financial condition and results
of operations of the Company along-with the performance and financial position of each of
the subsidiaries is provided in the Management Discussion and Analysis Report which forms
part of this Annual Report.
G. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into with Related Parties of the Company,
during the year under review, were in Ordinary Course of Business and were transacted at
arm's length basis.
Except the holding company of the Company, the Company did not have any
person or entity belonging
to the promoter/promoter group which held 10% or more shareholding
during the financial year under review.
Details of the related party transactions entered into by the Company
is provided in Note No. 31 of the Notes to the Standalone Financial Statement for the FY
2023.
Further, the Company had entered into Material Related Party
Transactions i.e., transactions exceeding 10% of the annual consolidated turnover as per
the last audited financial statements of the Company with Mahindra & Mahindra Limited
(m&m). These transactions were in Ordinary Course of Business of the Company and were
at arm's length basis. The details of these transactions, as required to be provided under
Section 134(3)(h) of the Act, are disclosed in Form AOC-2 as Annexure I and forms
part of this Report.
The Policy on materiality of and dealing with Related Party
Transactions as approved by the Board is uploaded on the website of the Company and is
accessible at the web-link:
https://www.cie-india.com/governance3.html#Policies.
H. PARTICULARS OF INVESTMENTS, LOANS, GUARANTEES AND SECURITIES
Particulars of investments made by the Company, as required under
Section 186 of the Act, are provided in Note No. 8 of the Notes to the Standalone
Financial Statements of the Company for the FY 2023.
Further, disclosure required pursuant to Regulation 34(3) read with
Part A of Schedule V of the Listing Regulations in respect of loans or advances in the
nature of loans given by the Company to its Subsidiaries is provided at the end of this
report. Apart from the loans or advances in the nature of loans given to the subsidiaries
of the Company as provided at the end of its report, the Company has not provided any
loans or advances in the nature of loans to any of its associates or any other person or
body corporate including to any firms/body corporates in which directors of the Company
are interested.
The particulars of loans given by the Company, as required under
Section 186 of the Act, are also provided in Note No. 8B of the Notes to the Standalone
Financial Statement of the Company for the FY 2023.
During the year under review, the Company has not provided any
guarantee or security in connection with the loan to any other person or body corporate.
I. PUBLIC DEPOSITS
The Company has not accepted any deposits during the year under review.
J. AUDITORS Statutory Auditors Report
The members of the Company at the 23rd Annual General
Meeting (agm) had appointed M/s. B S R & Co. LLP, Chartered Accountants (B S R LLP)
(lCAI Firm No. 101248W/W - 100022) as the Statutory Auditors of the
Company to hold office from the conclusion of 23rd AGM for a
term of consecutive five years till the conclusion of 28th AGM of the Company
to be held in the year 2027.
The Auditor's Report on the Financial Statement for the year ended 31st
December, 2023, is unmodified i.e., it does not contain any qualification, reservation
adverse remark or disclaimer and notes thereto are self- explanatory and do not require
any explanations.
Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Act and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had
appointed Mr. Sachin Bhagwat, Practicing Company Secretary (Certificate of Practice No.
6029), Secretarial Auditor to undertake the Secretarial Audit of the Company for the
Financial Year ended 31st December, 2023.
The Secretarial Audit Report for the Financial Year ended 31st
December, 2023 is appended to this Report as Annexure II. The report does not
contain any qualification, reservation, adverse remark or disclaimer.
Secretarial Audit of Material Unlisted Indian Subsidiary
CIE Aluminium Casting India Limited (formerly known as Aurangabad
Electricals Limited) (CIEALCAST), is a material subsidiary of the Company in India. The
Secretarial Audit of CIEALCAST for the financial year ended 31st December, 2023
was carried out pursuant to Section 204 of the Act and Regulation 24A of the Listing
Regulations by Mr. Sachin Bhagwat, Practicing Company Secretary (Certificate of Practice
No. 6029). The Secretarial Auditor's Report of CIEALCAST, does not contain any
qualification, reservation, adverse remark or disclaimer and the same is enclosed herewith
as
Annexure III.
Annual Secretarial Compliance Report
The Annual Secretarial Compliance Report issued by Mr. Sachin Bhagwat,
Practicing Company Secretary (Certificate of Practice No. 6029) in accordance with
Regulation 24A of the Listing Regulations read with Circulars issued thereunder by
Securities and Exchange Board of India has been submitted to the Stock Exchanges within
the prescribed timelines.
The same is also uploaded on the website of the Company and is
accessible at the web-link:
https://www.cie-india.com/documents-and-disclosure.
html#Secretarial-Compliance-Report
Cost Records
During the year under review, the Company maintained cost accounts and
records as required under Section 148 of the Act, read with the Companies (Cost Records
and Audit) Rules, 2014 as amended.
Cost Auditors
The Board had appointed Messrs. Dhananjay V. Joshi & Associates,
Cost Accountants, Pune, (Firm Registration
Number 000030) as Cost Auditor for conducting the audit of Cost Records
of the Company for Financial year ended 31st December, 2023.
In accordance with Section 148 of the Act, the Board of Directors of
the Company, on recommendation of the Audit Committee, re-appointed Messrs. Dhananjay V.
Joshi & Associates, Cost Accountants, Pune (Firm Registration Number 000030) as the
Cost Auditors of the Company to conduct the Audit of the Cost Accounting Records
maintained by the Company for the Financial Year ending 31st December, 2024.
Messrs. Dhananjay V. Joshi & Associates have confirmed that their appointment is
within the limits of Section 141(3)(g) of the Act and have also certified that they are
free from any disqualifications specified under section 141(3) read with Section 148(5) of
the Act.
As per the provisions of the Act, the remuneration payable to the Cost
Auditor is required to be placed before the Members in a General Meeting for their
ratification. Accordingly, a resolution seeking Members' ratification for the remuneration
payable to Messrs. Dhananjay V. Joshi & Associates, Cost Auditors is included in the
Notice convening the 25th Annual General Meeting.
Reporting of Frauds by Auditors
During the year under review, the Statutory Auditors, Cost Auditors and
the Secretarial Auditor have not reported any instance of fraud committed in the Company
by its Officers or Employees to the Audit Committee under section 143(12) of the Act,
details of which needs to be mentioned in this Report.
K. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND
The details of amounts transferred by the Company in relation to
unclaimed amounts of Dividend declared by the Company for the Financial Year ended 31st
December, 2021 and 31st December, 2022 to Unclaimed Dividend Account along-with
a statement containing the names, last known addresses, the unpaid dividend to be paid to
each person and the date when such unpaid Dividend is due for transfer to the Investor
Education and Protection Fund (IEPF) has been placed on the website of the Company and the
same is accessible at the web-link:
https://www.cie-india.com/periodic-public-
information8.html#IEPF
During the year under review, the Company was not required to transfer
any amount to IEPF.
Further, details of all the unclaimed amounts transferred by the
Company to IEPF in earlier years is uploaded on the website of the Company and is
accessible under the sub-tab 'Unclaimed Amount Transferred to IEPF' at the web-link:
https://www.cie-india.com/periodic-public- information8.html#IEPF
and is also available on the website of IEPF viz. www.iepf.gov.in.
No claim lies against the Company in respect of these unclaimed
amounts.
For any claims that are lodged with IEPF for unclaimed amounts, the
Company has nominated Mr. Pankaj Goyal, the Company Secretary of the Company as Nodal
officer for the purposes of verification of claims and coordination with Investor
Education and Protection Fund Authority as required under Investor Education and
Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 as amended
from time to time, the Contact details of the nodal officer are available on the website
of the Company at the aforementioned web-link.
L. EMPLOYEES
Key Managerial Personnel (KMP)
During the financial year, the following officers were the Whole-time
Key Managerial Personnel of the Company in accordance with Section 203 of the Act read
with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
1. Mr. Ander Arenaza - Executive Director
2. Mr. Manoj Menon - Executive Director and Chief Executive Officer -
Stampings, Composites, Foundry, Magnetics and Gears Divisions
3. Mr. Hari Krishnan - Chief Executive Officer - Forgings and Bill
Forge Divisions
4. Mr. K. Jayaprakash - Chief Financial Officer
5. Mr. Pankaj Goyal - Company Secretary and Compliance Officer
Mr. Hari Krishnan, Chief Executive Officer - Forgings and Bill Forge
Divisions expressed his desire to demit his executive responsibilities of the Company,
with effect from close of working hours 31st March 2024, due to his personal
reasons. The resignation of Mr. Hari Krishnan was noted by the Board of Directors at its
meeting held on 12th December, 2023, and he shall cease to be the Chief
Executive Officer - Forgings and Bill Forge Divisions and a Key Managerial Personnel of
the Company on close of working hours on 31st March, 2024.
Further, the Nomination and Remuneration Committee and the Board at
their respective meetings held on 12th December, 2023 reviewed the succession
and transition plan and approved the appointment of Mr. Sunil Narke as the Chief Executive
Officer - Forgings Division with effect from 1st April, 2024. The Forgings and
Bill Forge Division of the Company have Forging as its manufacturing technology and hence,
both these divisions shall be regarded as Forgings Division with effect from 1st
April, 2024, Mr. Sunil Narke shall head and be responsible for the business and operations
of all forging technologies plants of the Company in India, situated in Pune, Bangalore,
Coimbatore and Haridwar.
Employees' Stock Option Scheme
The Company had following Employees Stock Options Schemes :
b) Employees' Stock Options Scheme 2015 (ESOS-2015)
Voting rights on the shares issued to employees under above ESOS are
either exercised by the employees directly or through their appointed proxies.
Both the schemes were in compliance with the SEBI (Share Based Employee
Benefits) Regulations, 2021 ("SBEB Regulations"). The Certificate issued by the
Secretarial Auditor of the Company to the effect that the Schemes have been implemented in
accordance with the said Regulations and the resolution passed by the members will be
placed before the members at the ensuing Annual General Meeting.
The information as required to be disclosed, in relation to ESOS under
the Act, and the details of the ESOS being implemented, as specified by SEBI under the
SBEB Regulations is uploaded on the website of the Company and is accessible at the
web-link:
https://www.cie-india.com/documents-and-disclosure.
html#Esop-Disclosures
The said information is also provided in the Note No. 36 of the Notes
to Standalone Financial Statements.
During the year under review, the Nomination and Remuneration Committee
of the Board at its meeting held on 25th April, 2023 noted that all the options
granted under both of the ESOP schemes mentioned above were either exercised or lapsed and
there were no plans to grant new ESOPs under these schemes in view of the separate Stock
Appreciation Benefit Scheme approved by the Board and accordingly in terms of authority as
vested pursuant to respective schemes terminated the Employees' Stock Option Scheme
(ESOS-2007) and Employees' Stock Options Scheme 2015 (ESOS-2015) with effect from 25th
April, 2023.
Particulars of Employees and related disclosures
Disclosures with respect to the remuneration of Directors, KMPs and
employees as required under Section 197 (12) of the Act read with Rule 5 (1) of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given in Annexure IV to this Report.
Further, as required under provisions of Section 197(12) of the Act
read with Rule 5(2) & 5(3) of Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, as amended, a statement including the names and
other details of the top ten employees in terms of remuneration drawn and the name of
every employee, who were in receipt of remuneration not less than ' 10,200,000/- per annum
during the year ended 31st December, 2023 or employees who were employed for a
part of the Financial Year and were in receipt of remuneration of not less than '
8,50,000/- per month during any part of the said year is annexed as Annexure V to
this report.
The Board of Directors of the Company places on record its sincere
appreciation of the contributions Mr. Mungale and Mr. Narahari made towards the success of
the Company during their tenure.
Appointment of Independent Director
During the year under review, the Board at its meeting held on 2nd
June, 2023, on recommendation of the Nomination and Remuneration Committee, appointed Mr.
Jairaj Purandare (DIN: 00159886) as an Additional Director (Independent Director) of the
Company, with effect from 10th June, 2023. The Members of the Company, by way
of resolution passed through postal ballot on 8th September, 2023, approved his
appointment as a Director (Independent) to hold the office of the Independent Director for
a term of five years from 10th June, 2023 till 9th June, 2028.
Changes in Directorships pursuant to termination of Shareholders
Agreement
During the year under review, on 24th May, 2023 Mahindra
& Mahindra Limited (m&m) sold its entire stake comprising of 1,21,22,068 Equity
Shares representing 3.195% of the paid-up share capital of the Company and ceased to be a
shareholder of the Company. On 12th July, 2023 Participaciones Internacionales
Autometal Dos, S.L. (PIA2), Mahindra & Mahindra Limited (M&M), CIE Automotive S.A.
(CIE), Autometal S.A. (Autometal) and CIE Automotive India Limited (the Company)
(collectively referred to as the Parties) signed "Deed of Termination of Shareholders
Agreement" (the Termination Deed) terminating the Shareholders' Agreement dated 15th
June, 2013 signed between the Parties (the Shareholder's Agreement).
In terms of Termination Deed the Parties had agreed that, with effect
from the date of Stake Sale i.e., 24th May, 2023 none of the terms of the
Shareholder's Agreement shall be binding on the Parties. Accordingly, all the rights
vested in M&M and PIA2 in the Company pursuant to the Shareholders Agreement ceased to
be effective.
Mr. Shriprakash Shukla (DIN: 00007418) was nominated on the Board of
the Company by M&M, pursuant to its right under the Shareholders Agreement and was
appointed by the Board of Directors as Additional Director w.e.f. 1st April
2015 and by the Members of the Company as a Director liable to retire by rotation at the
16th AGM held on 15th September, 2015.
Consequent to the Termination Deed, M&M had withdrawn the
nomination of Mr. Shukla on the Board of the Company vide its letter dated 17th
July, 2023. Mr. Shriprakash Shukla (DIN: 00007418) tendered his resignation, from the
Board of Directors of the Company, with effect from close of business of 18th
July, 2023 i.e., he ceasing to be a Director and Non-executive Chairman of the Company
w.e.f. 19th July, 2023. With the resignation of Mr. Shukla, M&M had no
representation on the Board of the Company.
The Company had no employee who was employed throughout the Financial
Year or part thereof and was in receipt of remuneration, which in the aggregate, or as the
case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing
director or whole - time director or manager and holds by himself or along with his spouse
and dependent children, not less than 2% of the equity shares of the Company.
Industrial Relations
The relationship between the Management and Worker's Union continued to
remain cordial.
The Management Discussion and Analysis Report gives an overview of the
developments in Human Resources/ Industrial Relations during the year.
M. BOARD AND COMMITTEES
Retirement by rotation
Mr. Ander Arenaza (DIN: 07591785) and Mr. Anil Haridass (DIN: 00266080)
are liable to retire by rotation and being eligible, have offered themselves for
re-appointment at the 25th Annual General Meeting of the Company.
Re-appointment of Independent Directors
The Board of Directors of the Company at its meeting held on 19th
February, 2024, on the recommendation of the Nomination and Remuneration Committee, has
approved and proposed to the Members of the Company, re-appointment of Mr. Alan Savio
D'Silva Picardo (din: 08513835) and Ms. Roxana Meda Inoriza (DIN: 08520545), as the
Independent Directors of the Company for the second term of five years commencing from 29th
September, 2024 to 28th September, 2029. Their re-appointments shall be placed
for approval before the members at the ensuing 25th Annual General Meeting of
the Company.
As required under Regulation 36 (3) of the Listing Regulations and
Secretarial Standard-2, particulars of Directors seeking re-appointment at ensuing Annual
General Meeting shall be provided in the Notice of 25th Annual General Meeting
(AGM).
Changes in Board during the year under review
Completion of term of appointment of Independent Directors
Mr. Narahari Kadambi (DIN: 05351378) and
Mr. Dhananjay Mungale (DIN: 00007563) were appointed as the Independent
Directors of the Company for a second term Commencing from 29th September, 2019
to the date of Annual General Meeting to be held following completion of 70 (Seventy)
years of their age, subject to the condition that the term shall not be exceeding five
consecutive years commencing from 29th September, 2019. Accordingly, Mr.
Narahari Kadambi (DIN: 05351378) and Mr. Dhananjay Mungale (DIN: 00007563) completed their
term of appointment as Independent Directors of the Company on close of business hours on
9th June, 2023 and ceased to be Independent Directors of the Company w.e.f. 10th
June, 2023.
To take advantage of the vast experience and long association of Mr.
Shukla with the Company, the Board of Directors of the Company at its meeting held on 18th
July, 2023, on recommendation of the Nomination and Remuneration Committee, approved
appointment of Mr. Shriprakash Shukla (DIN: 00007418) as Additional Director
(Non-executive, Non-Independent), in his professional capacity with effect from 19th
July, 2023. The Members of the Company, by way of resolution passed through postal ballot
on 8th September, 2023, approved his appointment as Director (Non-Executive,
Non-Independent, Professional) of the Company, liable to retire by rotation with effect
from 19th July, 2023.
Appointment of Chairperson of the Board
The Board of the Directors of the Company at its meeting held on 17th
October, 2023, unanimously appointed Mr. Shriprakash Shukla, the Non-executive Director of
the Company, as the Chairman of the Board of Directors of the Company with effect from 17th
October, 2023.
Declaration of the Independent Directors
In accordance with Section 149(7) of the Act and Regulation 25(8) of
the Listing Regulations, all the Independent Directors have from time to time submitted
declarations confirming that they meet the criteria as mentioned in Regulation 16(1)(b) of
the Listing Regulations and Section 149(6) of the Act. The Independent Directors have also
confirmed that they are not aware of any circumstance or situation, which exist or may be
reasonably anticipated, that could impair or impact their ability to discharge their
duties with an objective independent judgement and without any external influence.
Further, the Board after taking these declaration/disclosures on record and acknowledging
the veracity of the same, opined that the Independent Directors of the Company, including
the Independent Director appointed during the year, are persons of integrity and possess
the relevant expertise and experience (including the proficiency), fulfils the conditions
specified in the Listing Regulations and the Act for appointment of Independent Directors
and are Independent of the Management.
Directors' Responsibility Statement
Pursuant to Section 134(5) of the Act, the Board of Directors, based on
the representation received from the Operating Management and after due enquiry, confirm
that:
a) in the preparation of the annual accounts for the financial year
ended 31st December, 2023, 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 ended on 31st December, 2023 and of
the profit and loss of the Company for that financial year ended on
that date;
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;
e) the directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and were
operating effectively during the financial year ended 31st December, 2023;
f) 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 during the financial year ended 31st December, 2023.
Board, Committee and Annual General Meeting
A calendar of Meetings is prepared and circulated in advance to the
Directors.
The Board of Directors of the Company met seven times during the
Financial Year ended 31st December, 2023 i.e., on 22nd February,
2023, 25th April, 2023, 2nd June, 2023, 18th July, 2023,
10th August, 2023, 17th October, 2023 and 12th December,
2023. The 24th Annual General Meeting of the Company was held on 9th
June, 2023 through Video Conferencing.
Details of attendance of meetings of the Board, its Committees and the
AGM are included in the Report on Corporate Governance, which forms part of this Annual
Report.
Meeting of Independent Directors
The Independent Directors of the Company met on 22nd
February, 2023 and 12th December, 2023 without the presence of the Chairman,
Executive Directors, other Non-Independent Director(s) and any other Managerial Personnel.
Performance Evaluation
During the year under review, the Nomination and Remuneration Committee
and Independent Directors have ascertained and reconfirmed that the deployment of
"questionnaire" as a methodology, is effective for evaluation of performance of
Board, its Committees and Individual Directors including non-independent Directors and the
Chairman.
Accordingly, feedback was sought on the structured questionnaire from
all the Directors of the Company, through electronic platform provided by an Independent
Agency, covering various aspects, on performance evaluation of the Board, Committees of
Board, Independent Directors, Non-Independent Directors, and
the Chairman. A report aggregating the responses of all the directors
of the Company was generated by the system.
Performance Evaluation of Individual Directors
The reports of the performance evaluation of Individual Directors were
shared with respective Directors and Chairman of the Nomination and Remuneration Committee
(NRC). Based on the same the NRC evaluated the performance of all individual directors.
The Independent Directors at their meeting separately evaluated the
performance of non-independent Directors and the Chairman.
Performance Evaluation of the Board and Committees of Board
The report of the feedback received from all the Directors on
performance evaluation of Board and Committees of Board was shared with the Chairman of
the Board and the Chairman of the respective Committees. The Board reviewed the reports
and evaluated its own performance and performance of the Committees of the Board.
The Independent Directors at their meeting separately evaluated the
performance of the Board. For details, please refer to the Report on Corporate Governance,
which forms part of this Annual Report.
Familiarisation Programme for Independent Directors
The details of programmes for familiarization of Independent Directors
with the Company, their roles, rights, responsibilities in the Company, nature of the
industry in which the Company operates, and related matters are given in the Report on
Corporate Governance.
The familiarisation programme and other disclosures as specified under
Regulation 46 of the Listing Regulations is available on the website of the Company at the
link:
https://www.cie-india.com/governance3.
html#Familiarisation-Program
Policy on Appointment and Remuneration
In line with the principles of transparency and consistency, the
Company has adopted the following Policies which, inter-alia includes criteria for
determining qualifications, positive attributes and independence of a Director.
i) Policy on appointment of Directors, Key Managerial Personnel and
Senior Management Employees and succession planning;
ii) Policy on the remuneration of Directors, Key Managerial Personnel
and other employees of the Company.
Salient features of these policies are enumerated in the Corporate
Governance Report which forms part of the Annual Report.
During the year under review, the Policy on the remuneration of
Directors, Key Managerial Personnel and other employees of the Company was reviewed
and amendments were made to bring more clarity in Components of Cost to
Company (CTC) Structure forming part of the Policy. Further the Policy on Appointment of
Directors, Key Managerial Personnel and Senior Management Employees and succession
planning was also reviewed as per the policy review cycle and amendments were made
inter-alia to bring more clarity in alignment with provisions in SEBI (LODR) Regulations,
2015 and also to merge Board Diversity Policy in this Policy.
The Policies mentioned above are also uploaded on the website of the
Company and is accessible at the web-link: https://www.cie-india.com/governance3.html#Policies
Committees of the Board
The Company has duly constituted the Committees required under the
Companies Act, 2013 read with applicable Rules made thereunder and the Listing
Regulations. Detailed disclosure in respect of all the Committees of the Board which
includes the Constitution of the Committees, the terms of references of each of the
Committee, the number of meetings held during the year and attendance etc. is provided in
the Corporate Governance Report.
Audit Committee
The Committee comprises of three independent directors as on 31st
December, 2023 viz:
1) Mr. Alan Savio D'Silva Picardo - Chairman,
2) Mr. Manojkumar Madangopal Maheshwari
3) Mrs. Roxana Meda Inoriza
Mr. Dhananjay Mungale ceased as Chairman and a member of the Committee
with effect from 25th April, 2023. Mr. Alan Savio D'Silva Picardo was appointed
as the Chairman of the Committee with effect from 25th April, 2023.
All the Members of the Committee are Independent Directors and possess
strong accounting and financial management knowledge.
The Company Secretary is the Secretary to the Committee. All the
recommendations of the Audit Committee were accepted by the Board during the financial
year under review.
N. GOVERNANCE Corporate Governance
The Company believes in attainment of highest levels of transparency in
all facets of its operations and maintains an unwavering focus on imbibing good Corporate
Governance practices. The Company continues to strengthen its governance principles to
generate longterm value for its various stakeholders on a sustainable basis thus ensuring
ethical and responsible leadership both at the Board and at the Management levels.
A Report on Corporate Governance along with a Certificate regarding the
compliance with the conditions of Corporate Governance as stipulated in the Listing
Regulations issued by Mr. Sachin Bhagwat, Practicing Company Secretary (ACS Number -
10189, CP Number - 6029) and Secretarial Auditor of the Company forms part of the Annual
Report.
Vigil Mechanism
The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules
prescribed thereunder and the Listing Regulations is implemented through the Company's
Whistle Blower Policy to enable the directors, employees and all stakeholders of the
Company to report their genuine concerns, to provide for adequate safeguards against
victimization of persons who use such mechanism and make provision for direct access to
the Chairman of the Audit Committee. The detail of the Policy is explained in the
Corporate Governance Report and has been uploaded on the website of the Company and is
accessible at the web-link: https://www.cie-india. com/ethical-channel.html
The Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
The Company has in place an Anti-Sexual Harassment Policy in line with
the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 (POSH Act) and Internal Complaints Committee (ICC) has been set
up to redress complaints received regarding sexual harassment at all workplaces of the
Company in compliance with the provisions of the POSH Act. All employees (permanent,
contractual, temporary, trainees) are covered under this Policy.
The framework ensures complete anonymity and confidentiality.
During the year under review, one complaint of sexual harassment was
received by the Internal Complaints Committee of a business division and the same was
dealt with and closed in accordance with the POSH Act and Policy made thereunder by the
ICC. The Company also had one pending complaint at the beginning of the year, which was
also closed during the year in accordance with the Policy and no complaint was pending as
at the end of the year.
Risk Management
The Board has constituted a Risk Management Committee which comprises
of three members as at the end of the financial year namely, Mr. Manoj Mullassery Menon -
Executive Director (Chairman of the Committee), Mr. Ander Arenaza Alvarez - Executive
Director and Mr. Alan Savio D Silva Picardo - Independent Director. The Committee also has
invitees from Senior Management team. The other details including the terms of reference
of the Committee are covered under the Corporate Governance report which forms part of
this Annual Report.
In accordance with the requirement of the Act and Listing Regulations,
the Company has developed and implemented a Risk Control and Management Policy which
establishes general framework for action, as well as the procedures and responsibilities
to control and manage the risks which the Company must face efficiently and effectively.
The risk management system of the Company ("RMS") allows it to reasonably ensure
that all significant risks, both financial and non-financial, including those which in the
opinion of the Board may threaten the existence of the Company, are prevented, identified,
assessed, subjected to ongoing control and reduced to the defined levels of risk appetite
and tolerance and are approved by the Risk Management Committee and ultimately by the
Board.
The Risk Management Committee, Audit Committee as well as the Board
reviews the risks and RMS periodically. The Company has established procedures to
periodically place before the Board, the risk assessment and minimisation procedures being
followed by the Company and steps taken by it to mitigate the Risks.
Important elements of risks are provided in the Management Discussion
and Analysis forming part of Annual Report.
O. SUSTAINABILITY AND CORPORATE SOCIAL RESPONSIBILITY
Sustainability
Sustainability has become an imperative aspect of business and all
stakeholders are paying attention to this aspect along-with financial performance of the
Company. It broadly covers the Environmental, Social and Governance (ESG) aspects of
business. The company understands that a wholistic approach to ESG is important to have
harmonious relations with all stakeholders in our business - shareholders, employees,
customers, suppliers and the community at large, which is key to long term stability of
our business model.
Environmental, Social and Governance Policy (ESG Policy) and ESG Plan
In accordance with the nine business responsibility principles provided
under National Guidelines on Responsible Business Conduct (NGRBCs) and Business
Responsibility and Sustainability Reporting framework prescribed by Securities and
Exchanges Board of India, the Board of Directors of the Company at its meeting held on 14th
December, 2022 adopted Environmental, Social and Governance Policy (ESG Policy) replacing
the existing Business Responsibility Policy of the Company.
The main objectives of the Policy are (i) to ensure that the actions of
the Company are governed by the principles as laid down in National Guidelines on
Responsible Business Conduct (NGRBCs) and to the extent applicable to our business and
operations, which are more particularly provided in the ESG Policy and (ii) to articulate
the corporate strategy related to sustainability through the commitments provided in the
ESG Policy.
Being a subsidiary of CIE Automotive S.A.,the Ultimate holding company
(CIE), the Company is bound by the 5 years Strategic ESG plan of CIE Automotive S.A. to
comply with 79 Key Performance Indicators (KPIs) designed under 4 pillars namely, CIE
culture, Ethical commitment, Eco efficiency and Active listening; which are aligned with
the UN- 17 Sustainable Development Goals. In order to identify the most important issues,
a materiality assessment was conducted to define key ESG KPIs and initiatives. These KPIs
became part of business process across all divisions of the Company. A review system is
put in place to ensure that these initiatives are driven at highest level in the
organisation and progress on the same is tracked on monthly basis.
Safety and Health
The Company places a strong emphasis on health and safety for all
employees and workers at its manufacturing sites. For sustaining a safe and healthy work
environment at all our manufacturing plants and offices and with the goal of achieving
zero incidents, the Company continues to undertake various initiatives. During CY2023 the
Company trained 4345 employees & workers on 12 Life Saving Rules which they need to
imbibe during their daily activities at plants. This one-day outbound training program has
re-emphasized management's commitment towards improving the safety culture. The Company
has also set-up Dexterity Centres which caters to twenty-three plants to impart necessary
safety induction programs for all new employees and workers.
Apart from the focus on extensive training, the initiatives of keeping
constant communication and timely reward and recognition ensured involvement of shop floor
employees in contributing towards the overall safety performance improvement. With all
these efforts the LTIFR for FY-23 improved to 0.07 compared to 0.11 during FY-22.
To improve health of employees the Company organized periodic health
check-ups 8,552 employees & workers undergone for annual health check-up & 1,494
employees undergone for executive health checkup during FY 23. The Company also conducted
programs for Stress Management and awareness on de-addiction to improve employee wellness.
Out of 25 manufacturing plants 24 plants have successfully certified
for ISO 45001 and ISO 14001 standards. The Rajkot Unit-2 plant will go for certification
in CY-24.
Business Responsibility and Sustainability Report
Pursuant to Regulation 34(2)(f) of the Listing Regulations read with
SEBI circular SEBI/HO/CFD/CFD-SEC-2/P/ CIR/2023/122 dated 12th July, 2023, the
Company has voluntarily opted to publish the Business Responsibility and Sustainability
Report (BRSR) in the new format prescribed in the said SEBI Circular which incorporates
the new KPIs of BRSR Core. The BRSR for the Financial Year ended on 31st
December, 2023, forms part of this Annual Report.
Conservation of Energy, Technology Absorption Foreign Exchange Earnings
and Outgo
The information pertaining to energy conservation, technology
absorption and foreign exchange earnings and outgo, as required under Section 134(3)(m) of
the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in Annexure
VI to this Report.
Corporate Social Responsibility (CSR)
The Company has constituted Corporate Social Responsibility (CSR)
Committee in accordance with Section 135 of the Act. The CSR Committee comprises of Mr.
Manoj Mullassary Menon (a member of the Committee, appointed as Chairman of CSR Committee
with effect from 25th April, 2023 ), Mr. Alan Savio D Silva Picardo (inducted
in CSR Committee with effect from 25th April, 2023) and Mr. Anil Haridass.
During the year under review, Mr. Kadambi Narahari and Mr. Dhananjay Narendra Mungale
ceased as Chairman and Member of the CSR Committee respectively with effect from 25th
April, 2023.
The CSR Policy developed and implemented by the Company including a
brief overview of the projects or programs undertaken by the Company in pursuance of the
CSR Policy are available on the Company's website and is accessible at the web-link: https://www.cie-india.
com/csrOLD1.html. During the year under review, no changes were made in the policy
except the amendment made in the Annexure 1 of the policy, in line with the Annual Action
Plan approved by the Board, which includes the details of the major CSR Activities
undertaken by the Company.
During the year under review the Company was required to spent ' 61.30
million in accordance with Section 135(1) of the Act, as its CSR obligation. Out of the
CSR Obligation of FY 2023, the Company has spent ' 67.04 million in accordance with the
Annual Action Plan approved by the Board. This includes excess spent of ' 5.74 million
towards Construction of Government Higher Primary School at Bengaluru due to increase in
construction area and other requirements, set-off of which shall be taken from CSR
obligation of FY2024, in accordance with Section 135(5) of the Act.
Further, during the previous financial year i.e., FY 2022, the Company
transferred ' 10.84 million to unspent CSR account of the Company in accordance with
Section 135(6) of the Act. The Company had spent this entire unspent CSR amount i.e., '
10.84 million on the Ongoing CSR Projects for which the said amount was allocated, in
accordance with the approved Annual Action Plan.
The CSR Committee affirmed that the implementation and monitoring of
the CSR projects during the year was in compliance with the CSR objectives and CSR policy
of the Company.
In accordance with the Companies (Corporate Social Responsibility
Policy) Rules, 2014 the Annual Report on CSR Activities inter-alia providing the salient
features of
Issue of Shares
During the year under review, the Company has issued and allotted
44,998 equity shares of face value of ' 10/- each, pursuant to exercise of options by the
employees under the Company's Employee Stock Option Scheme - 2015.
Compliance with the provisions of Secretarial Standard 1 and
Secretarial Standard 2
The Company have devised proper systems to ensure compliance with the
provisions of all applicable Secretarial Standards issued by the Institute of Company
Secretaries of India and that such systems are adequate and operating effectively. During
the year under review the Company was in compliance with the Secretarial Standards, i.e.,
SS-1 and SS- 2, relating to "Meetings of the Board of Directors" and
"General Meetings" respectively.
Compliance with Downstream Investment conditionalities
The Company is a Foreign Owned and Controlled Company within the
meaning of Foreign Exchange Management (Transfer or Issue of Security by a Person Resident
outside India) Regulations, 2017 ("FDI Regulations"). All the Downstream
Investments made by the Company are in compliance with the conditionalities of Downstream
Investment stipulated in the FDI Regulations.
During the year under review, the Company has obtained a certificate
from the Statutory Auditors of the Company for compliance with the FDI Regulations in
respect of the downstream investment made by the Company during financial year 2022. The
Auditors have affirmed compliance with downstream investment conditionalities by the
Company and have issued an unqualified report.
Annual Return
Pursuant to Section 92(3) read with section 134(3)(a) of the Act,
copies of the Annual Returns of the Company prepared in accordance with Section 92(1) of
the Act read with Rule 11 of the Companies (Management and Administration) Rules, 2014 are
placed on the website of the Company and is accessible at the web-link: https://
www.cie-india.com/documents-and-disclosure.html
Dividend Distribution Policy
Pursuant to Regulation 43A of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has
formulated a dividend distribution policy which became effective from 1st
January, 2017 stipulating factors to be considered in case of Dividend declaration. The
said policy was amended in financial year 2021 inter-alia to amend the Financial
Parameters that shall be considered while declaring dividend. There was no change in the
Policy during the Financial Year under review.
The Dividend Distribution Policy forms part of this report as Annexure
VIII.
the CSR Policy and details of CSR activities undertaken by the Company
during the year is annexed herewith as Annexure VII.
P. SECRETARIAL
Change in Name of the Company
On 31st May 2023 the Company received the fresh certificate
of incorporation dated 15th May 2023 issued by the Registrar of Companies,
Mumbai under Section 13(3) of the Act with the new name "CIE Automotive India
Limited". Accordingly, the name of the Company stands changed to CIE Automotive India
Limited w.e.f. 15th May 2023.
Further, the Stock Exchanges approved the change in the name and symbol
of the Company to "CIE Automotive India Limited" and "CIEINDIA"
respectively, w.e.f. 19th June, 2023.
Re-classification from Promoter/Promoter Group to Public
On 18th July, 2023 the Company received request from
Mahindra and Mahindra Limited (m&m) and Prudential Management and Services Private
Limited (Prudential) (Person acting in Concert with M&M), seeking reclassification
from the "Promoter" and "Promoter Group" category respectively to
"Public" category of the Company pursuant to Regulation 31A of the Listing
Regulations ("Listing Regulations"). The Board of Directors of the Company at
its meeting held on 18th July, 2023 considered, accepted and approved the
reclassification of M&M and Prudential from category of "Promoter" and
"Promoter Group" respectively to "Public" category.
The Stock Exchanges (BSE Limited and National Stock Exchange of India
Limited) accorded their approval to the said re-classification application vide their
letter dated 10th October, 2023 and thus M&M and Prudential ceased to be
part of Promoter/Promoter Group entities of the Company.
The Promoter and Promoter Group shareholding in the Company stood at
65.70% of the paid-up equity capital of the Company as on 31st December, 2023,
which is entirely held by Participaciones Internacionales Autometal Dos, S.L. (PIA2), the
Promoter of the Company.
Alteration of Articles of Association of the Company
The Board of the Company at its meeting held on 18th July,
2023 has approved to alter the Articles of Association of the Company by way of adoption
of the new set of Articles in substitution and to the entire exclusion of the extant
Articles of Association of the Company. The members of the Company approved the new set of
Articles of Association of the Company by way of resolution passed through postal ballot
on 8th September, 2023. The key changes made in the new set of articles of
association are pertaining to excluding all the clauses of the Shareholders' Agreement
which were incorporated in the earlier Articles of Association of the Company and to
incorporate necessary changes due to changes in Law.
The same has also been hosted on the website of the Company and is
accessible at the web-link: https://www.cie-india.eom/governance3.html#Policies
Other Policies under Listing Regulations
In accordance with the provisions of the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, the Company has framed various policies and
have hosted these polices on the website of the Company at the web-link: https://www.cie-india.com/governance3.
html#Policies
Q. GENERAL
None of the Executive Directors (Whole-time Director) were in receipt
of any commission from the Company hence the disclosure under Section 197(14) of the Act
is not applicable.
No disclosure or reporting is required in respect of the following
items as there were no transactions/ events relating to these items during the year under
review:
1. Issue of equity shares with differential rights as to dividend,
voting or otherwise.
2. Issue of Shares (including sweat Equity shares) to employees of the
Company under any Scheme save and except ESOS referred to in this Report.
3. Significant or material orders passed by the Regulators or Courts or
Tribunals which impact the going concern status and the Company's operation in future.
4. No application was made, or any proceedings is pending under the
Insolvency and Bankruptcy Code, 2016 during the year in respect of the Company.
5. There has been no change in the nature of business of the Company.
6. There was no one-time settlement of loan obtained from Banks or
Financial Institutions.
7. Voting rights which are not directly exercised by the employees in
respect of shares for the subscription/ purchase of which loan was given by the Company
(as there is no scheme pursuant to which such persons can beneficially hold shares as
envisaged under section 67(3) (c) of the Act).
Acknowledgement
The Board of Directors wish to place on record their sincere
appreciation to the Company's Customers, Investors, Vendors and to the Bankers for their
continued support during the year.
The Directors also wish to place on record their appreciation for the
dedication and contribution of all employees at all levels and look forward to their
support in future as well.
Annual Report on CSR activities for the financial year ended 31st
December, 2023
1. Brief outline on CSR policy of the Company:
Corporate Social Responsibility (CSR) has been an integral part of the
way CIE Automotive India Limited, (CIE INDIA or the Company) has been doing business. The
Company is committed to its social responsibilities and takes initiatives to serve society
as a good corporate citizen.
The Policy inter-alia provides the approach, direction and guiding
principles given by the Board of Directors of the Company, taking into account the
recommendations of the CSR Committee, for selection, implementation and monitoring of CSR
activities as well as formulation of the Annual Action Plan. The objective of this policy
is to:
Promote a unified and strategic approach to CSR
Encouraging employees to participate in the Company's CSR
Activities and giving back to society in an organized manner thereby increasing employee
satisfaction.
The Company focuses its CSR activities in the areas of (i) Education
and Skill Development (ii) Promotion of Health Care and Sanitation (iii) Environment and
(iv) Community Development (the Thrust Areas). The Company may also make contributions to
Prime Minister's National Relief Fund or Prime Minister's Citizen Assistance and Relief in
Emergency Situations Fund, or any other fund set up by the Central Government for socio
economic development and relief and welfare which qualifies the criteria as per the
Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended from time to
time ("CSR Rules") and the relevant provisions of the Companies Act, 2013
("the Act"). The Company encourages its employees to participate in the Employee
Social Engagement Program (ESEP), which is designed to drive positive change in society by
helping marginalized community through conducting health check-up camps, blood donation
camps, awareness on seasonal diseases. Various activities addressing environmental
concerns such as tree plantation, cleanliness drives, etc. are also undertaken. The
employees are also taking initiatives to provide vocational guidance to school children in
the nearby schools, providing educational aid like books, school bags etc. ESEP activities
are designed to benefit the economically and socially disadvantaged communities like
support to Old Age home, Orphanage etc. and involve employees to participate in Company's
CSR Activities.
2. Composition of CSR Committee:
Sl. No. Name
of Director |
Designation / Nature of
Directorship |
Number of eetings of CSR
Committee held during the year* |
Number of meetings of CSR
Committee attended during the year* |
1. Mr. Kadambi Narahari |
Chairman (upto 25/04/2023) |
1 |
1 |
2. Mr. Dhananjay Mungale |
Member
(upto 25/04/2023) |
1 |
1 |
3. Mr. Manoj Menon |
Chairman (w.e.f. 25/04/2023) |
4 |
4 |
4. Mr. Anil Haridass |
Member |
4 |
3 |
5. Mr. Alan Savio D Silva
Picardo |
Member
(w.e.f. 25/04/2023) |
3 |
3 |
* During the year under review, Mr. Narahari Kadambi ceased to a member
and the Chairman of the Committee and Mr. Dhananjay Narendra Mungale ceased to be a member
w.e.f. 25th April, 2023. Mr. Manoj Mullassary Menon a Member of the Committee
was appointed as the Chairman of the Committee and Mr. Alan Savio D Silva Picardo was
appointed as a member of the Committee w.e.f. 25th April, 2023. Hence, number
of meetings held during the year and number of meetings attended during the year are
referred by their respective term in the Committee during the year under review.
3. Provide the web-link(s) where Composition of CSR Committee, CSR
Policy and CSR Projects approved by the board are disclosed on the website of the company.
The Composition of CSR Committee is available at the link: https://www.cie-india.com/governance3.html
The CSR Policy and CSR projects as approved by the Board is available
at the link: https://www.cie-india.com/ csrOLD1.html
4. Provide the executive summary along with web-link(s) of Impact
Assessment of CSR Projects carried out in pursuance of sub-rule (3) of rule 8, if
applicable.
Not applicable.
5.
(a) Average net profit of the company as per sub-section (5) of section
135: ' 3,06,51,84,827/-
(b) Two percent of average net profit of the Company as per sub-section
(5) of section 135: ' 6,13,03,696/-
(c) Surplus arising out of the CSR Projects or programmes or activities
of the previous financial years: Nil
(d) Amount required to be set-off for the financial year, if any: Nil
(e) Total CSR obligations for the financial year [(b)+(c)-(d)]: '
6,13,03,696/-
6.
(a) Amount spent on CSR Projects (both Ongoing Project and other than
Ongoing Project): ' 6,70,45,864/-
(b) Amount spent in Administrative Overheads: Nil
(c) Amount spent on Impact Assessment, if applicable: Nil
(d) Total amount spent for the Financial Year [(a)+(b)+(c)]: '
6,70,45,864/-
(e) CSR amount spent or unspent for the Financial Year:
Total Amount Spent
for the Financial Year (in ') |
Amount Unspent
(in ') |
Total Amount
transferred to Unspent CSR Account as per sub-section (6) of section 135 of the Act |
Amount
transferred to any fund specified under Schedule VII as per second proviso to sub-section
(5) of section 135 of the Act |
Amount |
Date of transfer |
Name of the Fund |
Amount |
Date of transfer |
6,70,45,864 |
Nil |
NA |
Nil |
Nil |
Nil |
(f) Excess amount for set-off, if any: Nil
Sl. No. Particular |
Amount (in ') |
(1) (2) |
(3) |
(i) Two percent of average net
profit of the company as per sub-section (5) of section 135 |
61,303,696 |
(ii) Total amount spent for
the Financial Year |
67,045,864 |
(iii) Excess amount spent for
the Financial Year [(ii)-(i)] |
5,742,168 |
(iv) Surplus arising out of the
CSR projects or programmes or activities of the previous Financial Years, if any |
Nil |
(v) Amount available for set
off in succeeding Financial Years [(iii)-(iv)] |
5,742,168 |
7. Details of Unspent Corporate Social Responsibility amount for the
preceding three Financial Years:
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
Sl.
No |
Preceding
Financial
Year(s) |
Amount
transferred to Unspent CSR
Account under subsection (6) of section 135 (in ') |
Balance Amount
in Unspent CSR
Account under subsection (6) of section 135 (in ') |
Amount Spent in
the Financial Year (in ') |
Amount
transferred to a Fund as specified under Schedule VII as per second proviso to sub-
section (5) of section 135, if any |
Amount remaining
to be spent in succeeding Financial Years (in ') |
Deficiency, if
any |
Amount (in ') |
Date of Transfer |
1 |
2022 |
10,844,608 |
Nil |
10,844,608 |
Nil |
Nil |
Nil |
- |
2 |
2021 |
19,888,280 |
Nil |
Nil |
Nil |
Nil |
Nil |
- |
3 |
2020 |
17,620,968 |
Nil |
Nil |
Nil |
Nil |
Nil |
- |
Note: Amount transferred to Unspent CSR Account under sub- section (6)
of section 135 for FY 2020, FY2021 and FY 2022 have been entirely spent as per the
approved Annual Action Plan.
8. Whether any capital assets have been created or acquired through
Corporate Social Responsibility amount spent in the Financial Year:
(7) Yes No
If Yes, enter the number of Capital assets created / acquired 4
(Four)
Furnish the details relating to such asset(s) so created or acquired
through Corporate Social Responsibility amount spent in the Financial Year:
Sl.
No. |
Short particulars of the
property or asset(s) [including
complete address
and location of the property] |
Pin code of the property or
asset(s) |
Date of creation |
CSR amount spent () |
Details of
entity/ Authority/ beneficiary of the registered owner |
(1) |
(2) |
(3) |
(4) |
(5) |
(6) |
|
|
|
|
|
CSR
Registration Number, if applicable |
Name |
Registered
address |
1 |
Construction of Government
Higher Primary School with furniture and equipment |
562106 |
19.12.2023 |
3,80,66,902 |
NA |
Government
Higher
Primary
School |
Village Kallubalu, Jigni,
Hobli, Anekal Taluk, District Bengaluru - 562106, Karnataka |
2 |
Utkarsh - 4.1 Construction
of Boundary wall and Entrance gate |
415512 |
31.12.2023* |
20,00,000 |
NA |
Shree Girija Shankar High
School |
Village Rajache Kurle,
Taluka Khatav, District Satara - 415512, Maharashtra |
3. |
Road construction and high
mast light installation |
502228 |
31.12.2023* |
50,76,798 |
NA |
Gram
Panchayat
Buchinelly |
Village Buchinelly, Mandal
Zaheerabad, District
Sangareddy - 502228, Telangana |
Sl.
No. |
Short particulars of the
property or asset(s) [including
complete address
and location of the property] |
Pin code of the property or
asset(s) |
Date of creation |
CSR amount spent () |
Details of
entity/ Authority/ beneficiary of the registered owner |
(1) |
(2) |
(3) |
(4) |
(5) |
(6) |
|
|
|
|
|
CSR
Registration Number, if applicable |
Name |
Registered
address |
4 |
Utkarsh 2 - Construction
of Entrance Gate and furniture |
410513 |
22.09.2023 |
5,25,000 |
NA |
Gram
Panchayat
Bibi |
Post Bibi, Taluka Khed,
District Pune - 410513 Maharashtra |
Note: Date of creation of capital assets mentioned as 31.12.2023, are
the projects where the construction was still in progress as at end of the financial year
2023 and hence, handover was pending. The date will be updated after completion and
handover of the respective capital assets.
9. Specify the reason(s), if the Company has failed to spend two per
cent of the average net profit as per sub- section (5) of Section 135: Not applicable.
The Company has spent the entire CSR obligation of the Company for FY
2023 of ' 6,13,03,696, the Company have additionally spent an amount of ' 57,42,168 in FY
2023 towards Construction of Government Higher Primary School at Bengaluru due to increase
in construction area and other infra requirements. The amount of ' 57,42,168 which was
overspent in FY 2023 will be set-off in FY 2024 from CSR obligations of FY 2024 against
the said project, in accordance with section 135(5) of the Companies Act, 2013.
In addition to CSR obligation of FY 2023 of the Company, the Company
have also spent the entire amount of ' 1,08,44,608 from Unspent CSR Account of FY 2022. As
on 31.12.2023, the Company do not have any Unspent CSR amount.
The Company reiterates its commitment to discharge its social
obligation and shall continue to implement meaningful CSR projects in the CSR thrust areas
which have been identified and where the Company wishes to create equity.
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