The Board of Directors are pleased to present the 41st Annual Report of the United Drilling Tools Limited ("UDTL"). This report, inter-alia, includes the audited Financial Statements (Standalone and Consolidated) for the financial year ended March 31,2023 (FY23).
In compliance with the applicable provisions of Companies Act, 2013, (including any statutory modification(s) or re-enactment(s) thereof, for time being in force) ("Act") and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), this report covers the financial results and other developments during the financial year ended March 31,2023, in respect of UDTL.
1. BUSINESS PERFORMANCE AND FINANCIAL HEIGHLIGHTS
We aim to delivering best possible Returns on your valued Investment made in UDTL's values, principles and ethos. With this avowed goal instilled with your strong belief, blessings & continued support, we have closed this Financial Year with best possible results, despite odds & difficult times.
1.1 Financial Highlights
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(Rs. in Lacs)
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Particulars
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STANDALONE
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CONSOLIDATED
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FY 2022-23
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FY 2021-22
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FY 2022-23
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FY 2021-22
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Revenue from Operations
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11,934.02
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16,441.89
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11,982.69
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17,489.55
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Other Income
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157.36
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199.84
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59.73
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110.18
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TOTAL INCOME
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12,091.38
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16,641.73
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12,042.42
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17,599.73
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LESS Total Expenses
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10,626.78
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9,477.50
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10,561.61
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10,452.72
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Profit before Tax (PBT)
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1,464.60
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7,164.23
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1,480.81
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7,147.01
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LESS Tax Expenses
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446.94
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2,128.71
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453.35
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2,144.09
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Profit after Tax (PAT)
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1,017.66
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5,035.52
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1,027.46
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5,002.92
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Other comprehensive Income
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(6.79)
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(0.39)
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(6.79)
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(0.39)
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Total comprehensive Income for the period, net of tax
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1,010.87
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5,035.13
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1,020.67
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5,002.53
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1.2 General Information & State of Company's Affairs
Backed by robust manufacturing and R&D infrastructure, technologically advanced equipment, stringent quality control and a highly experienced team, UDTL presently manufactures different drilling tools across the four key product lines, such as Wire line and well service equipment, Gas Lift Equipment's, Downhole tools and large OD casing Connectors.
Four (04) state-of-the-art Manufacturing facilities of the Company have proven track record of manufacturing high-quality products of field-proven test designs in conformity with international standards as per ISO 9001 & American Petroleum Institute (API License No. 5CT-0565, 5L-0424, 7-1-0393, 19G1-0008, 19G2-0010). A new state-of-the-art and tech-focussed Greenfield
manufacturing unit is soon coming up near Mundra port in the State of Gujarat.
UDTL's continuing integration of new technologies and industry leading product lines enhances the technological advantages offered to the oil and gas industry; an experienced engineering and support personnel coupled with extensive product lines makes it a single source provider for wireline and slickline solutions.
I ncorporating products with newer technology and with over 4 decades of combined experience, the UDTL product group is one of the leading Companies in design and manufacturing of wireline products for slickline and electric line applications.
UDTL has always been an innovation-led company with team of design engineers conducting challenging Research and Development (R&D) Projects, as well as, client specific design programmes. Aided by the most up-to-date engineering and analysis software, their designs are robust, long lasting and comply with relevant region-specific regulations. Featuring the dependable field-proven UDTL closed loop hydraulic system used in UDTL winches on all oil fields worldwide, the current wireline units are the industry's most compact all-weather solution for today's dynamic world of well servicing.
During the FY23, the company successfully developed two new patents, which have been recognized as valuable assets and capitalized in the Company's Financial Statements.
UDTL's products are hi-tech parts and equipment for oil drilling industry, used for a variety of purposes. Also, there are entry barriers to these types of products because the technology is highly sophisticated and is available only in advanced countries such as US and Europe. Further, the technology developed by the company is protected, Patented in Europe.
UDTL Group is working closely with some of the renowned Government and associated entities in India such as ONGC, Oil India, Cairn Energy, and Welspun, among others. In the international markets, we work with some of the renowned brands, such as Halliburton, Schlumberger, and Geo Empro among others. Our revenues are distributed between government organisations, private sector companies and exports in the oil and gas sectors.
2. DIVIDEND
During the Year under review, the Directors have declared and paid two interim dividends aggregating 12% i.e; '1.20/-per equity share of '10/- each.
The Directors have also recommended a final dividend @ 6% i.e; '0.60/- per equity share of '10/- each based on the parameters laid down in the Policy and such dividend will be paid out of of the distributable profits for the year.
The said dividend, if approved by the Members at the ensuing Annual General Meeting ("the AGM") will be paid to those Members whose name appears on the register of Members (including Beneficial Owners) of the Company as at the end of August 26, 2023.
Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of the Members w.e.f. April 1, 2020 and the Company is required to deduct tax at source from dividend paid to the Members at prescribed rates as per the Income Tax Act, 1961.
In terms of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ('SEBI Listing Regulations') the Board of Directors of the Company (the 'Board') had formulated and adopted a Dividend Distribution Policy (the 'Policy') and same is available on the website of the Company i.e; https://udtltd.com/policies/.
3. SHARE CAPITAL
During the year under review, the Company has not altered/ modified its authorised share capital and has not issued any shares including equity shares with differential rights as to dividend, voting or otherwise. The Company has not issued any sweat equity shares to its directors or employees.
The Paid-up Share Capital of the Company as on March 31, 2023 is '20,30,31,260/- divided into 2,03,03,126 Equity Shares of '10/- each fully paid up.
4. LISTING
UDTL's Equity Shares continues to be listed on both the domestic stock exchange(s) viz., BSE Limited and National Stock Exchange of India Limited. Also, both NSDL & CDSL, Depositories are providing their services to our valued Shareholders / Members. Your Company has paid Annual Fee(s) to all of them for the Financial Year 2023-24.
5. PUBLIC DEPOSITS
The Company has not accepted any deposits falling within the meaning of Section 73 or 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 during the financial year and as such, no amount on account of principal or interest on deposits from public was outstanding during the year under review.
6. CREDIT RATING
With strong commitment, performance, rating agency had continuously maintained BBB (STABLE) Rating for FY 2022, as also during FY 2023. This reaffirms reputation and trust, the Company has earned for its sound financial management and its ability to meet its financial obligations, commitment to its stakeholders.
7. CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements of the Company and its subsidiaries for FY 2022-23 have been prepared in compliance with the applicable provisions of the Companies Act, 2013 ('the Act') and as stipulated under Regulation 33 of SEBI Listing Regulations as well as in accordance with the Indian Accounting Standards notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time.
8. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
During the FY23, the Company has 1 (one) Wholly-owned Subsidiary. The Board of Directors reviewed the affairs of the subsidiary. There is no other change in the status of subsidiaries, joint ventures and associate companies. Further, in accordance with Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company and its subsidiary along with a statement containing the salient features of the financial statements of Company's subsidiaries in Form AOC-1 forms part of Annual Report, given in "Annexure-1".
The statement also provides the details of performance, financial positions of the subsidiary Company. As per the provisions of Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and other related information of the Company and audited financial statements of its subsidiary, are available on the website of the Company i.e; www.udtltd. com. These documents will also be available for inspection during business hours at our registered office till date of annual general meeting.
The policy for determining material subsidiaries may be accessed on the Company's website at https://udtltd.com/ policies/.
9. AUDITORS AND THEIR REPORTS9.1. Statutory Auditors and Statutory Audit Reports
Pursuant to Sections 139 & 142 of the Act, M/s R S Dani & Co., Chartered Accountants (ICAI Firm Registration No. 000243C) were appointed as the Statutory Auditors of the Company at the 37th AGM, for a period of five years. They continue as the Statutory Auditors of the Company.
There are no audit qualifications, reservations, disclaimers or adverse remarks, or reporting of fraud in the Statutory Auditors Report given by M/s R S Dani &
Co. Statutory Auditors of the Company for the financial year 2022-23 annexed in this Annual Report.
M/s R S Dani & Co., after carrying out the audit for the financial year ended March 31, 2023, and issuance of Limited Review Report on the un-audited financial results for the 1st quarter ended June 30, 2023, had resigned on August 14, 2023, to enable the Company to align its statutory auditors with the successor statutory auditors. The Board, after placing on record its appreciation for the contribution made by M/s R S Dani & Co., over the last ten years, accepted their resignation as statutory auditors in the meeting held on August 14, 2023.
Further, the Board took note of requisite declarations, consent letters and eligibility certificates received from the proposed Statutory Auditors i.e; M/s Sarupria Somani & Associates, Chartered Accountants (ICAI Firm Registration No. 010674C). They have confirmed that their appointment as Auditors, if made, shall be in accordance with the conditions laid down in the Companies Act, 2013 and rules made thereunder, including the criteria provided in Section 141 and Section 144 of the Companies Act, 2013 and SEBI Listing Regulations.
The Board approved the appointment of M/s Sarupria Somani & Associates, Chartered Accountants (ICAI Firm Registration No. 010674C) as the statutory auditors of the Company to fill the casual vacancy and further recommended to the shareholders for the appointment of statutory auditors for a first term of two years from the date of ensuing Annual General Meeting till the conclusion of the 43rd Annual General Meeting to be held in the year 2025 on such remuneration as may be mutually agreed between the statutory auditors and the Board of Directors of the Company, from time to time.
9.2. Secretarial Auditors & Secretarial Audit Report
In term of the provision of Section 204 of the Company Act, 2013 the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company had appointed M/s Balraj Sharma & Associates, Company Secretaries, New Delhi as Secretarial Auditors of the Company for the financial year ended March 31,2023.
The Company provided all assistance and facilities to the Secretarial Auditor for conducting their audit. The report of the Secretarial Auditors in Form MR-3 forms part of the Directors' Report as "Annexure-2".
There are no audit qualifications, reservations, disclaimers, or adverse remarks in the said Secretarial Audit Report. Your Company complies with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India and notified by the Ministry of Corporate Affairs.
9.3. Internal Auditor & Internal Audit Reports
During the FY23, pursuant to the provision of section 138 of the Act and Listing Regulations, M/s APU & Co., Chartered Accountants, New Delhi, having vast experience in field of Taxation, Finance and Accounts, have been appointed as Internal Auditors of the Company for the financial year 2022-23 to conduct the Internal Audit of key functions and assessment of Internal Financial Controls, etc.
The Internal auditors have submitted their report on quarterly basis, to the Audit Committee of the Company. The Report of Internal Auditors does not mention any qualifications, reservations or adverse remarks.
9.4. Annual Secretarial Compliance Report
The Company has undertaken an audit for the Financial Year ended March 31, 2023 for all applicable compliances as per the Regulation 24A of the Listing Regulations and Circulars/ Guidelines issued thereunder. The Annual Secretarial Compliance Report issued by M/s Balraj Sharma & Associates, Company Secretaries had submitted to the Stock Exchange/s as per the Listing regulations.
9.5. Reporting of Frauds by Auditors
During the FY23, the Statutory Auditors, Internal Auditors and Secretarial Auditors 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 and the rules made thereunder.
10. CFO CERTIFICATION
Pursuant to Regulation 17(8) read with Schedule II Part B of the Listing Regulations, a certificate from the Chief Financial Officer ('CFO') and Managing Director of the Company have certified and confirming the correctness of the Financial Statements (Standalone and Consolidated) and Cash Flow Statements (Standalone and Consolidated), adequacy of the internal control measures for financial reporting for the year ended March 31, 2023. The certificate dated May 29, 2023 which is forms part of this report as "Annexure-3".
11. DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITH THE COMPANY'S CODE OF CONDUCT
The Company has adopted a Code of Conduct for its employee including the Managing Director, Executive Directors, NonExecutive Directors and Independent Directors of the Company. Pursuant to the relevant listing regulations, the Company has received a compliance confirmation certificate from the Managing Director of the Company dated August 14, 2023 which is forms part of this report as "Annexure-4".
12. CERTIFICATE ON NON-DISQUALIFICATION OF DIRECTORS
None of the Directors on the Board of the Company for the FY ended March 31,2023, have been debarred or disqualified from being appointed or continuing as Director of the Company. The Company have received a Certificate from Practicing Company Secretary dated August 01,2023, which is forms part of this report as "Annexure-5".
13. CORPORATE SOCIAL RESPONSIBILITY
UDTL has formulated a Corporate Social Responsibility (CSR) Policy to undertake CSR initiatives as specified in Schedule VII of the Companies Act, 2013. UDTL has constituted a robust and transparent governance structure to oversee the implementation of this Policy, in compliance with the requirements of Section 135 of the Companies Act, 2013.
The Company's commitment to create significant and sustainable societal value is manifest in its CSR initiatives and its sustainability priorities are deeply intertwined with its business imperative.
The Company's focus areas are concentrated on increasing access to health, education, environment sustainability, community development and holistic development with a focus on underprivileged people living around its manufacturing units and other establishments.
In accordance with Section 135 of the Act, as amended, read with Notification issued by the Ministry of Corporate Affairs ('MCA' ) dated January 22, 2022 and September 20, 2022 the applicable rules, the Company has updated Corporate Social Responsibility Policy, a brief outline of which, along with the required disclosures, is given in "Annexure-6" of this report in the format as prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014, which forms part of this Report.
The CSR Policy is available on the website of the Company i.e; https://udtltd.com/policies/.
14. MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the Listing Regulations, Management Discussion and Analysis Report for the financial year under review is presented in a separate section, forming an integral part of this Annual Report as "Annexure-7".
15. CORPORATE GOVERNANCE
We, at UDTL, re-affirms its continued commitment, adhering good Corporate Governance practices. The Company is committed to maintain the highest standards of corporate governance and adherence to the corporate governance requirement set out by SEBI Listing Regulations.
Pursuant to Regulation 34(3) of the Listing Regulations, a report on Corporate Governance along with a Certificate from the Chartered Accountants in Practice towards compliance of the provisions of Corporate Governance, forms an integral part of this Annual Report and are given in "Annexure-8" and "Annexure-9"respectively.
16. PARTICULARS OF EMPLOYEES AND REMUNERATION
Disclosure pertaining to remuneration and other details 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 is annexed to the Report as "Annexure-10".
Statement containing particulars of top 10 employees and particulars of employees as required under Section 197 (12) of the Act read with Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as a separate Annexure forming part of this report.
17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company has always been conscious of the need to conserve energy in its manufacturing plants and to protect environment. Energy conservation is achieved through optimized consumption of power and fossil fuels and improvements in energy productivity, which contributes in reduction in operational costs and climate change mitigation through reduction in greenhouse gases.
The information pertaining to details of conservation of energy, technology absorption, 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 given in "Annexure-11".
18. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Pursuant to Regulation 34(2)(f) of the Listing Regulations, the initiatives taken by the Company from an environmental, social and governance perspective for the FY23 has been given in the Business Responsibility and Sustainability Report (BRSR) as per the format specified by SEBI Circular no. SEBI/ HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021 which is forms part of this report as "Annexure-12".
19. RELATED PARTY TRANSACTIONS
The Board of Directors of the Company had laid down the criteria dealing with Related Party Transactions. During the year, the Company had not entered into any materially significant transaction as defined in the RPT Policy with related parties viz. promoters, directors, their relatives or the management, subsidiaries etc. that may have potential conflict with the interests of the Company at large.
All transactions entered by the Company during the FY23 with related parties were in the ordinary course of business and on an arm's length basis, which were recommended and approved by the Audi Committee.
Form AOC-2 furnishing particulars of contracts or arrangements entered by the Company with related parties referred to in Section 188(1) of the Companies Act, 2013, is annexed to this report as "Annexure-13".
The details of all the Related Party Transactions form part of Note No. 32D(8) to the standalone financial statements attached to this Annual Report. The Policy on the materiality of related party transactions and dealing with related party transactions as approved by the Board is available on the website of the Company i.e; https://udtltd.com/policies/.
20. INTERNAL FINANCIAL CONTROL, AUDIT SYSTEMS AND THEIR ADEQUACY
The Company's internal financial controls are commensurate to the scale and complexity of its operations.
The Company has adequate internal financial controls systems in place, which facilitates orderly and efficient conduct of its business including adherence to Company's policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information.
Internal Control Over Financial Reporting (ICFR) remains an important component to foster confidence in a company's financial reporting, and ultimately, streamlining the process
to adopt best practices. Your Company through Internal Audit Program is regularly conducting test of effectiveness of various controls. The ineffective and unsatisfactory controls are reviewed and remedial actions are taken immediately. The internal audit plan is also aligned to the business objectives of the Company which is reviewed and approved by the Audit Committee. Further the Audit Committee monitors the adequacy and effectiveness of your Company's internal control framework.
Esteemed Members / Shareholders may please refer 'Internal control systems and their adequacy' section in the Management's discussion and analysis report, which forms part of this Annual Report.
21. ANNUAL RETURN
Pursuant to Section 92(3) of the Act and Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return for FY the 2022-23 is uploaded on the website of the Company and the same is available on the website of the Company i.e; https://udtltd.com/annual-return/.
22. VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company has formulated a comprehensive Whistle Blower Policy in line with the provisions of Section 177(9) and 177(10) of the Act and Regulation 22 of the Listing Regulations with a will to enable the stakeholders, including directors, individual employees to freely communicate their concerns about illegal, suspected Fraud or unethical practices and to report genuine concerns to the Audit Committee of the Company.
The mechanism provides adequate safeguards against victimization of directors or employees who avail of the mechanism. The Whistle Blower Policy is available on the website of the Company i.e; https://udtltd.com/policies/.
23. PROHIBITION OF INSIDER TRADING
In terms of the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as amended (PIT Regulations), the Company has adopted the revised "Code of Conduct to Regulate, Monitor and Report Trading by Insiders" ("the Code"). The Code is applicable to all Directors, Designated persons and connected Persons and their immediate relatives, who have access to unpublished price sensitive information relating to the Company.
Pursuant to PIT Regulations and circulars issued by SEBI and Stock Exchange/s from time to time, the Company have installed the Structured Digital Database (SDD) Software and all UPSI duly captured, quarterly compliance certificate also filed to Stock Exchanges.
The Company has also formulated a 'Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI) in compliance with the PIT Regulations. The aforesaid Codes are available on the website of the Company i.e; https://udtltd.com/code-of-conduct/.
24. PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security were proposed to be utilized by the recipients are provided in the standalone financial statements (Please refer to Notes to the standalone financial statements).
25. DIRECTORS AND KEY MANAGERIAL PERSONNEL25.1 Board of Directors
During the FY23, the Board of the Company is duly constituted having proper balance of Executive and Non-executive Directors in compliance of extant applicable Laws, Rules & Regulations, comprises of 07 (Seven) members out of which 4 (Four) are Independent Directors and 3 (Three) are Executive Directors including Chairman-cum-Managing Director. As on the date of this report, there was no change in the composition of the Board of Directors.
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The composition of the Board of Directors at the end of FY23 was as under:-
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Mr. Pramod Kumar Gupta :
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Chairman &
Managing
Director
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Mr. Kanal Gupta :
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ExecutiveDirector
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Mr. Inderpal Sharma :
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ExecutiveDirector
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Mr. Krishan Diyal Aggarwal :
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Independent
Director
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Mrs. Preet Verma :
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Independent
Director
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Mr. Pandian Kalyanasundaram :
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Independent
Director
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Mr. Ved Prakash Mahawar :
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Independent
Director
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Further, in terms of Section 152 of the Act and the Articles of Association of the Company, Mr. Kanal Gupta (DIN - 01050505), Whole-time Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting. Mr. Kanal Gupta, being eligible, has offered himself for re-appointment at the ensuing Annual General Meeting. His appointment is placed for approval of the members and forms part of the notice of the 41st AGM. The information about the Director seeking his reappointment as per Para 1.2.5 of Secretarial Standards on General Meetings and Regulation 36(3) of the Listing Regulations has been given in the AGM.
During the FY23, the Members in their 40th Annual General Meeting held on September 26, 2022 approved the re-appointment of Mr. Pramod Kumar Gupta (DIN - 00619482) as Chairman-cum-Managing Director w.e.f December 21, 2022 upto December 20, 2027 and Mr. Inderpal Sharma (DIN - 07649251) as Whole Time Director of the Company w.e.f the conclusion of 40th AGM upto the conclusion of 45th AGM to be held in the year 2027. The members in their 40th Annual General Meeting also confirm the re-appointment of Dr. Pandian Kalyanasundaram (DIN - 02568099) as NonExecutive Independent Director of the Company for another (second) term of five consecutive years from the conclusion of 39th AGM upto the conclusion of 44th AGM to be held in the year 2026.
The members of the Company through Postal Ballot results declared on May 06, 2023, approved the reappointment of Mr. Kanal Gupta (DIN - 01050505) as Whole-time Director of the Company w.e.f February 10, 2023 upto February 09, 2028.
The Company has received declarations from each Independent Director of the Company under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations confirming compliance with the criteria of independence as stipulated under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and there has been no change in the circumstances which may affect their status as Independent Directors during the FY 2022-23.
All Independent Directors of the Company have affirmed compliance with the Schedule IV of the Act and Company's Code of Conduct for Directors and Employees for the FY 2022-23.
In terms of the Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, all Independent Directors of the Company have enrolled themselves with the Indian Institute of Corporate Affairs ('IICA') on the Independent Directors Databank.
Further, all the members of Board have declared their equity shares holding as well as interest in the Company as per requirement of Companies Act, 2013 and Listing Regulations.
The Company has adopted a policy on familiarisation programme for Independent Directors with an objective of making the Independent Directors of the Company accustomed with the business and operations of the Company through various structured orientation programme. The familiarization programme also intends to update the Directors on a regular basis on any significant changes therein so as to be in a position to take well informed and timely decision.
The details of the familiarization programme undertaken have been uploaded on the website of the Company i.e; https://udtltd.com/policies/.
25.2 Key Managerial Personnel
I n terms of the provisions of Section 203 & 2(51) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following are the Key Managerial Personnel of the Company as on the date of report:
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Mr. Pramod Kumar Gupta
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: Chairman & Managing Director
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Mr. Kanal Gupta
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: ExecutiveDirector
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Mr. Inderpal Sharma
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: ExecutiveDirector
|
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Mr. Manoj Kumar Arora
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: Chief Financial Officer
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Mr. Anand Kumar Mishra
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: Company Secretary & Compliance Officer
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During the FY23, Mr. Naveen Bhatnagar was appointed as Company Secretary & Compliance Officer with effect from March 29, 2022 and have tendered their resignation & ceased to be Compliance Officer & Company Secretary w.e.f. March 18, 2023.
Further, Mr. Mukesh Mehta also tendered their resignation & ceased to be the Chief Financial Officer (CFO) of the Company w.e.f. September 20, 2022. After that Mr. Manoj Kumar Arora, qualified Chartered
Accountants was appointed as Chief Financial Officer (CFO) of the Company w.e.f. February 11,2023.
The remuneration and other details of these KMPs for the FY23 are provided in the Corporate Governance Report which forms part of this report.
25.3 Committees of the Board & their meetings
In compliance with applicable laws, rules and regulations, as also for other purposes following Committee/s were constituted / reconstituted:-
• Audit Committee
• Nomination and Remuneration Committee
(NRC)
• Stakeholders Relationship Committee
• Corporate Social Responsibility Committee
(CSR)
• Risk Management Committee
The composition of the Committees was in conformity with the applicable provision of the Companies Act, 2013 and Listing Regulations.
For more details on composition and meeting of committee/s for the FY23 are provided in the Corporate Governance Report which forms part of this report.
25.4 Meetings of Board of Directors
The Board of Directors of the Company met 5 (five) times during the financial year ended March 31,2023. These meetings of the Board of Directors were held on May 25, 2022, August 13, 2022, September 26, 2022, November 12, 2022 and February 11,2023.
The composition of Board of Directors during the year ended March 31,2023 is in conformity with Regulation 17 of the SEBI Listing Regulations read with Section 149 of the Companies Act, 2013. For more on attendance and other details for the FY23 are provided in the Corporate Governance Report which forms part of this report.
The provisions of Companies Act, 2013 and Listing regulations were adhered to timely while considering the time gap between two (02) meetings and various other requirements including Secretarial Standards as issued by The Institute of Company Secretaries of India (ICSI).
25.5 Meetings of Independent Directors
Pursuant to Section 149(8) read with Schedule V and other applicable provisions of the Companies Act,
2013 and Regulation 25(3) of Listing regulations, a separate meeting of Independent Directors was held on February 11,2022. The said meeting was attended by Mr. Krishan Diyal Aggarwal, Mrs. Preet Verma, Mr. Pandian Kalyanasundaram and Mr. Ved Prakash Mahawar without presence of other Directors, inter alia to:-
• Review the performance of Non-Independent Directors, the Board as a whole and that of its various Committees constituted;
• Review the performance of the Chairperson of the Company, taking into account the views of Executive Director/s and Non-Executive Director/s; and
• Assess the quality, content and timeliness of flow of information between the Company Management and the Board which is necessary for the Board to effectively and reasonably perform its duties.
25.6 Performance Evaluation of Board and Effectiveness
Pursuant to the provisions of the Act and Listing Regulations and as per Guidance Note on Board Evaluation issued by SEBI, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as evaluation of the working of its Committees at its meeting held on February 11, 2023 on the basis of a structured Questionnaire covering various aspects of the Board's functioning.
During the FY23, all Directors have participated in the evaluation process and opined that the integrity, expertise, and experience (including proficiency) of the Independent Directors are satisfactory. The Nomination and Remuneration Committee has defined the evaluation criteria for the performance evaluation of individual Directors, the Board and its Committees.
The review concluded by affirming that the Board as a whole as well as its Chairman, all of its members, individually, and the Committees of the Board continued to display a commitment to good governance by ensuring a constant improvement of processes and procedures and contributed their best in the overall growth of the organization.
26. DIRECTORS' APPOINTMENT AND REMUNERATION POLICY:
The Company has on the recommendation of the Nomination and Remuneration Committee framed and adopted a Nomination and Remuneration Policy in terms of the Section 178 of the Act. The policy, inter alia lays down the
of India Limited at www.bseindia.com and www.nseindia. com respectively.
The Securities and Exchange Board of India (SEBI) has by its Circular No. SEBI/HO/MIRSD/MIRSD_RTAMB/P/ CIR/2021/655 dated November 03, 2021, Circular No. SEBI/ HO/MIRSD/MIRSD_RTAMB/P/CIR/2021/687 dated December 14, 2021 and Circular No. SEBI/HO/MIRSD/MIRSD-PoD-1/P/ CIR/2023/37 dated March 16, 2023 made it mandatory for all holders of physical Securities to furnish the copy of PAN, Nomination in form SH-13, Cancellation or change in Nomination in form SH-14, Updation of contact detail in form ISR-1, & updation of Bank account details in form ISR-2. In this regard, you may contact with our Company's designated Registrar & Share Transfer Agent (RTA) and / or to our Company's official.
29. RISK MANAGEMENT
The Risk Management is an integral and important component of Corporate Governance. The Board of Directors of the Company has constituted Risk Management Committee ('RMC') which assists the Board in monitoring and reviewing the risk management plan, implementation of the risk management framework of the Company and such other functions as Board may deem fit.
The Risk Management framework is in place to identify, prioritize, mitigate, monitor and appropriately report any significant threat to the organization's strategic objectives, its reputation, operational continuity, environment, compliance, and the health & safety of its employees. A detailed section on Risk Management is provided in the Management Discussion and Analysis Report forming an integral part of this Integrated Annual Report.
Pursuant to Section 134(3)(n) of the Act and Regulation 17(9) of the Listing Regulations, the Company has formulated and adopted a Risk Management Policy, same is available on the website of the Company i.e; https://udtltd.com/policies/.
The Company has been consciously following a policy of risk mitigation by diversifying its products, services, markets and customers. Further, within the Industrial & Engineering segment, the risk of excessive reliance on contract manufacturing is being addressed by strengthening and growing the Company's own product portfolio and creating brand equity.
30. DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors make the following statement in terms of Section 134 of the Act that:
principles relating to appointment, cessation, remuneration and evaluation of directors, key managerial personnel and senior management personnel of the Company.
Non-executive, independent directors are paid, "Sitting Fee/s" within the limits prescribed under the Companies Act, 2013 at a fixed rate per meeting attended by them and as such the same cannot be compared with the remuneration to other employees. There-apart, no other remuneration or perquisite was paid to, and no service contract was entered into with them.
The Nomination & Remuneration Policy of the Company is available on the website of the Company i.e; https://udtltd. com/policies/.
27. SECRETARIAL STANDARDS AND INDIAN ACCOUNTING STANDARDS
The Board of Directors affirms that UDTL has complied in true letter & spirit with applicable Secretarial Standard/s issued by the Institute of Companies Secretaries of India (SS-1 and SS-2) relating to Board Meetings, Committees thereof. Also, UDTL has complied with applicable Indian Accounting Standards while preparing these financial statements.
28. GREEN INITIATIVE & SHAREHOLDERS INFORMATION
The Ministry of Corporate Affairs (MCA), Government of India has taken a 'Green Initiative in the Corporate Governance' vide its Circular Nos. 17/2011 dated 21.04.2011 and 18/2011 dated 29.04.2011 which enables the entity to effect electronic delivery of documents including the Notice of Annual General Meeting/Extra Ordinary General Meeting, audited financial statements, Director's Reports, etc. in electronic form, to the e-mail address the Shareholders have registered with Depository Participant(DP).
The Shareholders are requested to register/update their e-mail address immediately in their respective DP accounts so as to receive delivery of documents in electronic form instead of getting the same in physical form.
The Shareholders holding shares in physical form desirous of availing electronic form of delivery of documents/notices are requested to immediately register/update their e-mail address, by contacting with our designated Registrar and Transfer Agents, namely, M/s Alankit Assignments Limited.
Members may please note that AGM Notice and Annual Report 2022-23 are being send only in electronic mode and the said notice and annual report are also available on the Company's website www.udtltd.com, websites of the Stock Exchange/s i.e; BSE Limited and National Stock Exchange
• in the preparation of the annual financial statements for the year ended March 31,2023, the applicable accounting standards were followed along-with proper explanation relating to material departures;
• such accounting policies applied consistently and judgments and estimates have been made 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 March 31, 2023 and of the profit of UDTL for the year ended on that period;
• proper and sufficient care has been taken 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;
• the annual accounts for FY 2022-23 were prepared on a Going Concern basis; and
• devised the proper system to ensure compliance with the provisions of all applicable laws and that such and were adequate and operating effectively.
31. PREVENTION OF SEXUAL HARASSMENT
The Company has in place a policy on prevention, prohibition and redressal of Sexual Harassment at workplace in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Committee has been setup to look after the complaints.
The Company is committed towards promoting the work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment irrespective of their gender, race, social class, caste, creed, religion, place of origin, sexual orientation, disability or economic status.
All employees of the Company are covered under this policy. The details of complaints received and disposed-off during the FY23 is as follows:
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S. No. Particulars
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Status
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1. Number of complaints pending at the beginning of the FY23
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0
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2. No. of complaints received during the FY23
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0
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3. No. of complaints resolved during FY23
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0
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4. Number of complaints pending at the end of
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0
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FY23
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32. OTHER STATUTORY DISCLOSURE
During FY23, there were no transaction requiring disclosure or reporting in respect of matters relating to:
• Maintenance of cost records under sub-section (1) of Section 148 of the Act is not applicable to the Company.
• No material changes and commitment, affecting the financial position of the Company which occurred between the end of FY23 till the date of this Report.
• No instance of any one-time settlement with any Banks or Financial Institutions.
• No application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016.
• No significant and material orders passed by the Regulators/ Courts/Tribunals which impact the going concern status and Company's operations in future.
• UDTL has not issued any Equity Shares including with Differential Voting Rights / Sweat Equity Shares.
• No occasion for revision in the Financial Statements for the year under report.
• No change in the nature of business of UDTL as on the date of this Report.
• No any remuneration or commission to the Whole-time Director/ Managing Director of the Company from the subsidiaries of the Company.
• None of the Independent / Non- Executive Directors have any pecuniary relationship or transactions with the Company which in the judgement of the Board may affect the independence of the Directors.
• No transfer any amount to General Reserves of the Company, due to enhancing shareholders value.
33. CAUTIONARY STATEMENT
UDTL is involved in the manufacturing of oil drilling tools and equipments. Since these tools and equipments are predominantly used in the oil and gas industry, we are focusing on the growth and prospects of them only.
Directors' Report, Business Responsibility and Sustainability Report, Management Discussion & Analysis Report, Financial Statements (Standalone & Consolidated); annexure(s), attachment(s) thereto information pertaining to the projections, estimates, etc. are forward looking under SEBI
applicable rules and regulations, whereas, the actual results might differ.
I mportant factors that could make difference to UDTL's operations includes, Global and India's Demand, Supply conditions, finished goods prices, Raw Material availability and Prices, cyclical Demand and pricing in the Company's principal markets, changes in Government regulations, tax regimes, economic developments within India and the Countries with whom UDTL conducts business and other factors such as litigation and labour negotiations.
The Company is not obliged to publicly amend, modify/revise forward looking statement(s), on the basis of any subsequent development, information or events or otherwise.
34. ACKNOWLEDGEMENTS
The Directors take this opportunity to thank the shareholders, bankers and the financial institutions for their cooperation and support to the operations and look forward for their continued support in future. The Directors also thank all the customers, vendor partners, and other business associates for their continued support during the year. The Directors place on record their appreciation for the hard work put in by all employees of the Company.
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