# Included in other current assets - Qualified Institutions Placement expenses
** As per section 135 of the Companies Act, 2013, CSR committee was formed by the Company. The area for CSR activities is promoting education and self employment enhancement. A sum of Rs, 1.41 Crore (which is at par with the provision @ 2% of average net profit of preceding 3 years of Rs, 1.32 Crore) was contributed to Corpus Fund of S.L.Minda Charitable Trust and Moga Devi Charitable Trust for utilization on CSR activities.
Contingent liabilities relating to other cases RS,0.71 Crore (previous year RS,0.74 Crore).
Future cash outflows in respect of the above would be determinable on finalization of judgments /decisions pending with various forums / authorities.
(b) Corporate guarantees given by the Company and outstanding as at 31 March 2017 amounting to RS,59.21 Crore (previous year RS,48.82 Crore) in respect of loans borrowed by related parties. Further, the Company has also provided ‘letter of comfort’ amounting to RS,183.91 Crore (previous year RS,155.77 Crore) in respect of loans taken by related parties from banks.
(c) Liability of Customs duty towards export obligation undertaken by the Company under “Export Promotion Capital Goods Scheme (EPCG)” amounting to RS,1.95 Crore (Previous year RS,1.35 Crore).
During the current year the Company had imported Capital goods under EPCG and saved duty to the tune of RS,1.95 Crore (previous year H1.35 Crore). As per the EPCG terms and conditions, Company needs to export RS,11.70 Crore (previous year RS,8.07 Crore) i.e. 6 times of duty saved on import of Capital goods on FOB basis within a period of 6 years. If the Company does not export goods in prescribed time, then the Company may have to pay duty on imported capital goods, including interest and penalty thereon.
(d) The Company has availed sales tax incentives for its unit at Pune, Maharashtra, from the Government of Maharashtra amounting to RS,0.34 Crore (previous year RS,3.35 Crore). In accordance with Scheme of Government of Maharashtra for Development of Industries, the amount may be refundable to the Government, if specified conditions are not fulfilled, within the prescribed time.
Note . capital and other commitments (net of advance)
Estimated amount of contracts remaining to be executed on capital account and not provided for as at 31 March 2017 aggregates to RS,6.52 Crore (previous year RS,6.59 Crore).
As per Accounting Standard- 4 (Revised), the Company cannot create provision for dividend proposed after the balance sheet date unless a statute requires otherwise. Rather, Company will need to disclose the same in notes to the financial statements. Accordingly, the Company has disclosed dividend proposed by board of directors after the balance sheet date in the notes to the financial statements. Refer note 3.
note 2. Additional investments
The Company has made following additional investments during the current year:
1. 40,924,800 equity shares of ROKI Minda Co. Private Limited (face value of H10/- each) for a total consideration of RS,43.08 Crore.
2. Additional 5,927,730 equity shares of Minda TG Rubber Private Limited (face value of H10/- each) for a total consideration of RS,5.93 Crore.
3. Additional 32,732,000 equity shares of Minda Kosei Aluminum Wheel Private Limited (face value of H10/- each) for a total consideration of RS,32.73 Crore.
4. Additional 2,100,000 equity shares of Global Mazinkert, S.L. (face value of Euro1 each) for a total consideration of RS,15.98 Crore.
5. 84,996 equity shares of H100/- each fully paid up of Rinder India Private Limited for a total consideration of RS,39.68 Crore.
6. 188,600,000 equity shares of RS,10/- each of Minda Storage Batteries Private Limited for a total consideration of RS,9.05 Crore.
7. Additional 4,178,571 equity shares of Kosei Minda Aluminum Company Private Limited (face value of RS,10/- each) for a total consideration of RS,4.18 Crore.
note 3.
During the year 2002-03, the Director, Town and Country Planning, Chandigarh issued a demand notice on the Company amounting to RS,0.39 crore towards revised CLU (change of land use) charges for the land situated at Village Nawada Fatehpur, P.O. Sikanderpur Badda, Gurgaon, and Haryana. The Company paid RS,0.02 crore and had also filed a Special Leave Petition (SLP) with the Hon’ble Supreme Court of India, basis which a leave had been granted. Further, the Company had deposited RS,0.09 crore as under protest with the authorities. During the previous years, the Company had filed a writ petition with the High Court of Punjab and Haryana in order to cancel the demand notice and obtain a stay on the balance demand. Further, the Company had withdrawn the petition and accordingly had agreed to pay the total liability of RS,0.28 crore and the interest thereon amounting to RS,0.44 crore (previous year RS,0.41 crore) towards revised CLU charges after adjusting the amount of H0.11 crore paid earlier.
During the year 2013-14, the Company had applied for grant of license under ‘Affordable Housing Policy- 2013’ on the land measuring 9.9625 acres in revenue estate of Village Nawada, Fatehpur Sector-81, Gurgaon and paid scrutiny fee (non-refundable) amounting to RS,0.15 crore in this respect.
On issue of license either under ‘Residential Group Housing Colony scheme’ or under ‘Affordable Housing Policy 2013’, CLU charges would be payable as per terms and conditions of the scheme.
note 4. Segment information
Segment information is prepared in conformity with the accounting policies adopted for preparing and presenting the financial statements of the Company as a whole.
As the Company’s business activity primarily falls within a single business segment i.e. Auto Components including Electrical Parts and its Accessories as primary segment, thus there are no additional disclosures to be provided under Accounting Standard 17 - ‘Segment Reporting’. The management considers that the various goods and services provided by the Company constitutes single business segment, since the risk and rewards from these services are not different from one another.
* on the basis of location of customers.
** on the basis of location of the assets.
Assets used in the Company’s business and liabilities contracted in respect of its business activities, are not identifiable in line with the above reportable segments as the assets and liabilities contracted are used interchangeably between the segments. Accordingly, except for trade receivables, no separate identification relating to other segment assets and liabilities has been made.
note 5. Related Party Disclosures (i) Related parties where control exists:
Subsidiaries (including step down subsidiaries) Minda Auto Components Limited
Minda Kosei Aluminum Wheel Private Limited Minda TG Rubber Private Limited (w.e.f. 30 March 2016)
Minda Kyoraku Limited M J Casting Limited (w.e.f. 1 August 2015)
Minda Distribution and Services Limited
PT Minda Asean Automotive (stepdown subsidiary) (w.e.f. 1 July 2015) PT Minda Trading (Indirect Subsidiary) (w.e.f. 1 July 2015)
SAM Global Pte. Ltd (w.e.f. 1 July 2015)
Minda Industries Vietman Company Limited (stepdown subsidiary) (w.e.f. 1 July 2015)
Global Mazinkert S.L.
Clarton Horn, Spain (Indirect subsidiary)
Clarton Horn Maroc SARL (Indirect subsidiary)
Clarton Horn, Signalakustic GmbH (Indirect subsidiary)
Clarton Horn, Mexico S. De R. L. De C.V. (Indirect subsidiary)
Rinder India Private Limited (w.e.f 3 June 2016)
Minda Storage Batteries Private Limited (w.e.f 23 September 2016)
Light & Systems Technical Centre S.L. Spain (Indirect subsidiary) (w.e.f 26 June 2016)
Partnership firm YA Auto Industries (w.e.f. 8 August 2016)
(ii) Other related parties with whom transactions have taken place during the year/ previous year and the nature of related party relationship:
Associates Mindarika Private Limited
Minda NexGenTech Limited
Kosei Minda Aluminum Company Private Limited (w.e.f 29 March 2016)
Partnership firms Auto Component (Firm)
Yogendra Engineering (Firm)
Joint ventures (jointly controlled entities) Minda Emer Techonologies Limited
M J Casting Limited (upto 31 July 2015)
Roki Minda Co. Private Limited (w.e.f 1 October 2016)
Rinder Riduco, S.A.S. Columbia (Indirect Joint Venture w.e.f 10 June 2016)
Key management personnel Mr. Nirmal K. Minda
(ii) Other related parties with whom transactions have taken place during the year/ previous year and the nature of related party relationship:
{Chairman and Managing Director(‘CMD’)}
Mr. Sudhir Jain (CFO)
Mr. H.C. Dhamija ( Company Secretary)
Relatives of key management personnel Mrs. Suman Minda (wife of CMD)
Mrs. Paridhi Minda Jindal (daughter of CMD)
Mrs. Palak Minda (daughter of CMD)
Mr. Vivek Jindal (son-in-law of CMD)
Other entities over which key management personnel and their rela- Minda Investments Limited tives are able to exercise significant influence Minda International Limited
Minda Corporation Limited Nirmal K. Minda (HUF)
Minda Industries (Firm)
Minda Spectrum Advisory Limited Samaira Engineering (Firm)
S.M.Auto Industries (Firm)
Shankar Moulding Ltd.
Maa Rukmani Devi Auto Limited
MI Torica India Private Limited
Minda F Ten Private Limited
Fujitsu Ten Minda Private Limited
Minda Mindpro Limited
Minda Nabtesco Automotive Private Limited
# Nil in previous year column represent H Nil or transaction less than 10% of the class of transaction.
* Excluding taxes.
Note 6. Disclosure pursuant to Accounting Standard-15 on “Employee Benefits”
a) Defined contribution plan
An amount of RS,9.69 Crore (previous year RS,8.36 Crore) for the year, has been recognized as an expense in respect of the Company’s contribution towards Provident Fund, deposited with the Government authorities and has been included under employee benefit expense in the Statement of Profit and Loss. An amount of RS,0.49 Crore (previous year RS,0.42 Crore) for the year, has been recognized as an expense in respect of the Company’s contribution towards Superannuation Fund, and has been included under employee benefit expense in the Statement of Profit and Loss. Further an amount of RS,1.35 Crore (previous year RS,1.19 Crore) for the year, has been recognized as an expense in respect of the Company’s contribution towards ESI Fund, and has been included under employee benefit expense in the Statement of Profit and Loss.
b) Defined benefit plans
Gratuity is payable to all eligible employees of the Company on retirement/exit, death or permanent disablement in terms of the provisions of the Payment of Gratuity Act, 1972.
The members of the Company had approved ‘Minda Employee Stock Option Scheme 2016’ at the Annual General Meeting held on 11 August 2016. The plan envisaged grant of stock options to eligible employees at market price in accordance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014.
This scheme provided for conditional grant of Performance Shares at nominal value to eligible management employees as determined by the Compensation Committee of the Board of Directors from time to time. The performance measures under this scheme include group achieving the target market capitalization.
The maximum number of equity shares to be allotted under the scheme are 1,500,000. The number of options granted under the 2016 Performance Share Schemes are 888,000 equity shares at an exercise price of RS,180/- each and 98,750 equity shares at an exercise price of RS,392/- each. The scheme is monitored and supervised by the Nomination and Remuneration Committee of the Board of Directors in compliance with the provisions of Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 and amendments thereof from time to time.
The Company has adopted the intrinsic value method as permitted by the SEBI Guidelines and the Guidance Note on Accounting for Employee Share Based Payment issued by the Institute of Chartered Accountants of India in respect of stock options granted.
The Employee Stock Option Plan includes employees of Minda Industries Limited and its subsidiaries. The cost reimbursed by subsidiaries for the year is RS,0.85 crore.
The Company’s profit for the year and earnings per share would have been as under, had the compensation cost for employees’ stock options been recognized based on the fair value at the date of grant in accordance with Black Scholes model. The fair value of the underlying shares has been determined by an independent valuer.
The risk free interest rates are determined based on the zero-coupon yield curve for Government Securities or Government bonds with maturity equal to the expected term of the option. Volatility calculation is based on annualized standard deviation of the continuously compounded rate of return of the stock over a period of time. The historical period taken into account to match the expected life of the option. Dividend yield has been arrived by dividing the dividend for the period with the current market price.
* The term ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated 8 November 2016.
**Other denomination notes represents other than ‘Specified Bank Notes’ referred above.
During the year, the Company came out with issue of equity shares to qualified institutional buyers (‘QIB’) aggregating to Rs, 300.00 Crore. The Company approved the issue of 7,092,125 equity shares of Rs, 2 each, at an issue price of Rs,423.00 per equity share (Rs,421.00 per share towards share premium). The shares were fully subscribed and were allotted on 3 April 2017. The issue is within the authorized capital of the Company. The Company incurred expenses amounting to Rs,5.23 Crore in relation to the aforesaid placement. These expenses have been adjusted against the balance of securities premium subsequent to the year end at the time of allotment of shares.
note 7.
The Company has established a comprehensive system of maintenance of information and documents are required by the transfer pricing legislation under section 92-92F of the Income Tax Act, 1961. Since the law requires existence of such information and documentation to be contemporaneous in nature, the Company is in the process of updating the documentation for the transactions entered into with the associated enterprises during the financial year and expects such records to be in existence latest by due date as required under the law. The management is of the opinion that its transactions with the associated enterprises are at arm’s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.
note 8.
Previous year figures have been reclassified / regrouped, wherever required, to confirm to current year classification
(i) Rights, preferences and restrictions attached to equity shares
The Company has only one class of equity shares having par value of Rs.10
per share. Each shareholder is entitled to one vote per share held. The
dividend proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing Annual General Meeting. In the event
of liquidation, the equity shareholders are eligible to receive the
remaining assets of the Company after distribution of all preferential
assets, in proportion to their shareholding. During the year, the
amount of per share dividend recognised as distributions to equity
shareholders is Rs.7 (previous year Rs.6).
(ii) Rights, preferences and restrictions attached to preference shares
The Company has issued 3% cumulative redeemable preference shares of
class ''''C'''' having par value of Rs.10 per share. Each Shareholder has right
to receive fixed preferential dividend at a rate of 3% on the paid up
capital of the Company. Preference shareholders also have right to
receive all notices of general meetings of the Company but no right to
vote at any meetings of the Company save to the extent and in the
manner provided in the Companies Act, 2013.
Preference shareholders neither have right to participate in any offer
or invitation by way of right or otherwise to subscribe additional
shares nor they have right to participate in any issue of bonus shares
or shares issued by way of capitalization of reserves.
3,500,000 3% Cumulative redeemable preference shares of Rs.10 each have
been allotted on 17 February 2010, redeemable at par, after seven years
from the date of allotment. However, same can be redeemed earlier in
view of availability of profitability / surplus fund.
In the event of liquidation, preference shareholders have a preference
right over equity shareholder to be repaid to the extend of capital
paid-up and dividend in arrears on such shares.
(a) Aggregate number and class of shares allotted as fully paid up
pursuant to contract(s) without payment being received in cash for the
period of five years immediately preceding the balance sheet date:
Equity shares includes
(i) 2,405,128 equity shares of Rs.10 each fully paid up issued during the
year 2010-11 for consideration other than cash to the shareholders of
Minda Autogas Limited, pursuant to the scheme of amalgamation.
(ii) 1,120,164 equity shares of Rs.10 each fully paid up issued during
the year 2011-12 for consideration other than cash to the shareholders
of Minda Acoustic Limited, pursuant to the scheme of amalgamation.
(iii) 1,835,000 equity shares of Rs.10 each fully paid up issued during
the year 2011-12 on conversion of 3% cumulative compulsorily
convertible preference shares of Rs.2,187 each (Class ''''B'''').
(b) The Company has not allotted any bonus shares or bought back any
shares during the current year or for a period of five years
immediately preceding the balance sheet date.
Contingent liabilities relating to other cases Rs.74.07(previous year
Rs.11.30).
Future cash outflows in respect of the above would be determinable on
finalization of judgments / decisions pending with various forums /
authorities.
(b) Corporate guarantee given by the Company and outstanding as at 31
March 2016 amounting to Rs.4,882(previous year Rs.7,625) in respect of
loans borrowed by related parties. Further, the Company has also
provided a ''''letter of comfort'''' amounting to Rs.15,577(previous year
Rs.4,477) in respect of a loan taken by related parties from banks
(c) Liability of Customs duty towards export obligation undertaken by
the Company under "Export Promotion Capital Goods scheme (EPCG)"
amounting to Rs.134.53 (Previous year Rs.146.29).
During current period the Company had imported Capital goods under EPCG
and saved duty to the tune of Rs.134.53. As per the EPCG terms and
conditions, Company need to export Rs.807.15 (previous year Rs.904.45)
i.e. 6 times of duty saved on import of Capital goods on FOB basis
within a period of 6 years. If the Company does not export goods in
prescribedtime, then the Company may have to pay duty on imported capital
goods, including interest and penalty thereon.
(d) The Company has availed sales tax incentives for its unit at Pune,
Maharashtra, from the Government of Maharashtra amounting to Rs.335.26
(previous year Rs.225.65). In accordance with Scheme of Government of
Maharashtra for Development of Industries, the amount may be refundable
to the government, if specified conditions are not fulfilled, within
the prescribed time.
Note 1. Capital and other commitments (net of advance)
Estimated amount of contracts remaining to be executed on capital
account and not provided for as at 31 March 2016 aggregates to Rs.659.23
(previous year Rs.727.37).
Note 2. Impairment
(i) During the previous years, an impairment charge amounting to
Rs.2,213.79 was recorded, up to 31 March 2014 for Battery Division
located at Pant Nagar, which was incurring continuous losses. During
the year 2014-15, a binding sale agreement for the transfer of Battery
Division was concluded on 1 October 2014. Accordingly, based on net
selling price (lump sum consideration), an impairment charge to the
extent of Rs.1,576.33 (net of depreciation of Rs.637.46) was reversed
on 30 September 2014. The same was disclosed as an Exceptional item. The
carrying amount of the total assets and liabilities to be hived off is
Rs.3,073.32 (previous year Rs.3,981.90) and Rs.474.92 (previous year
Rs.879.83) respectively as on 31 March 2016. The date of hiving off
which was expected to be 30 September 2015 is being extended to on
or before 30 June 2016.
Note 3. Diminution in the value of investment
During the previous year, the Company had recorded diminution other
than temporary in value of investment amounting to Rs.1,216.80 based on
report of independent valuer in respect of investment in M J Casting
Limited, a joint venture entity. The Company made additional
investments on 01 August 2015, post which M J Casting Limited has
become subsidiary of the Company.
Note 4. Additional Investment
The Company has made following additional investments during the
current year;
1. Additional 280.80 lacs Equity Shares of MJ Casting Ltd. (face value
of Rs.10/- each) for a total consideration of Rs.1,404
2. 3.125 lacs Equity Shares of Sam Global Pte Ltd., Singapore (face
value of USD 1 each) for a consideration of Rs.1,941.44
3. Additional 13,845 equity shares of PT MInda Asean Automotive (face
value of USD 10 each) for a total consideration of Rs.613.67
4. Investment in 419.95 lacs Equity Shares of Minda Kosei Aluminum
Wheel Pvt. Ltd. (face value of Rs.10/- each) for a total consideration
Of Rs.4,199.51
5. 178.50 lacs Equity Shares of Rs.10/- each fully paid up of Minda TG
Rubber Private Limited for a total consideration of Rs.1,789.46
6. 245.588 lacs Equity Shares of Rs.10/- each of Kosei Minda
Aluminum Co. Private Limited. (face value of Rs.5/- each) for a total
consideration of Rs.1,231.0
7. Investment in Rs.0.11 lacs Equity Shares of OPG Power Generation
Pvt Ltd. (face value of Rs.10/- each) at premium of Rs.1 for a total
consideration of Rs.1.25
Note 5. During the year 2002-03, the Director, Town and Country
Planning, Chandigarh issued a demand notice on the Company amounting to
R39.51 towards revised CLU (change of land use) charges for the land
situated at Village NawadaFatehpur, P.O. SikanderpurBadda, Gurgaon,
and Haryana. The Company paid Rs.1.58 and had also filed a Special Leave
Petition (SLP) with the Hon''''ble Supreme Court of India, basis which a
leave had been granted. Further, the Company had deposited Rs.9.50 as
under protest with the authorities. During the earlier year, the Company
had filled a writ petition with the High Court of Punjab and Haryana in
order to cancel the demand notice and obtain a stay on the balance
demand. Further, the Company had withdrawn the petition and accordingly
had agreed to pay the total liability of R28.43 and the interest thereon
amounting to Rs.40.65, towards revised CLU charges after adjusting the
amount of Rs.11.08 paid earlier.
During the year 2013-14, the Company had applied for grant of license
under ''''Affordable housing Policy- 2013'''' on the land measuring 9.9625
acres in revenue estate of Village Nawada, Fatehpur Sector-81, Gurgaon
and paid scrutiny fee (non- refundable) amounting to Rs.15.35 in this
respect.
On issue of license either under ''''Residential Group Housing Colony
scheme'''' or under ''''Affordable housing policy 2013, CLU charges would be
payable as per terms and conditions of the scheme.
Note 6. Segment Information
Segment information is prepared in conformity with the accounting
policies adopted for preparing and presenting the financial statements
of the Company as a whole.
As the Company''''s business activity primarily falls within a single
business and geographical segment i.e. Auto Components including
Electrical Parts and its Accessories as primary segment, thus there are
no additional disclosures to be provided under Accounting Standard 17 -
''''Segment Reporting. The management considers that the various goods and
services provided by the Company constitutes single business segment,
since the risk and rewards from these services are not different from
one another.
Note 7. Disclosure pursuant to Accounting Standard-15 on "Employee
Benefits"
a) Defined contribution plan
An amount of Rs.835.66 (previous year Rs.755.76) for the year, has been
recognized as an expense in respect of the Company''''s contribution
towards Provident Fund, deposited with the government authorities and
has been included under employee benefit expense in the Statement of
Profit and Loss. An amount of Rs.42.20 (previous year Rs.36.67) for the
year, has been recognized as an expense in respect of the Company''''s
contribution towards Superannuation Fund, and has been included under
employee benefit expense in the Statement of Profit and Loss. Further
an amount of Rs.119.23 (previous year Rs.111.23) for the year, has been
recognized as an expense in respect of the Company''''s contribution
towards ESI Fund, and has been included under employee benefit expense
in the Statement of Profit and Loss.
b) Defined benefit plans
Gratuity is payable to all eligible employees of the Company on
retirement/exit, death or permanent disablement in terms of the
provisions of the Payment of Gratuity Act, 1972.
The obligation for compensated absences is recognized in the same
manner as Gratuity.
Note 8. Leases
The Company has taken premises and certain machineries on cancellable
operating leases. The lease rentals recognised in the Statement of
Profit and Loss for the year 31 March 2016 is Rs.1,206.04 (Previous Year
Rs.1,061.08).
Note 9. During the year ended 31 March 2012, one of the manufacturing
facilities of the Light division at Pune had incurred loss of fixed
assets and inventory on account of fire. During the previous year, the
Company has received final claim of Rs.27.52 as full and final settlement
of the insurance claim. The same was disclosed as an ''''Exceptional item''''
in the Statement of Profit and Loss.
Note 10. The Board of Directors, subject to the approval of
shareholders & High Court have considered and approved the scheme of
merger of MJ Casting Limited (MJCL) with the Company. MJCL is
manufacturing Die casting products. The Board also considered and
approved the scheme of de-merger, of International Investment Division
of Minda Investments Limited & Singhal Fincap Limited and their merger
with Minda Industries Limited. The proposed effective date of the
scheme is from 1 April 2016.
Note 11. The Company has established a comprehensive system of
maintenance of information and documents are required by the transfer
pricing legislation under section 92-92F of the Income Tax Act, 1961.
Since the law requires existence of such information and documentation
to be contemporaneous in nature, the Company is in the process of
updating the documentation for the transactions entered into with the
associated enterprises during the financial year and expects such
records to be in existence latest by due date as required under the
law. The management is of the opinion that its transactions with the
associated enterprises are at arm''''s length so that the aforesaid
legislation will not have any impact on the financial statements,
particularly on the amount of tax expense and that of provision for
taxation.
Note 12. Previous year figures have been reclassified/ regrouped,
wherever required, to confirm to current year classification.
1 The Cash Flow Statement has been prepared in accordance with the
''Indirect Method'' as set out in the Accounting Standard
(AS)- 3 on ''Cash Flow Statement'', as specified under the section 133 of
the Companies Act, 2013
2 Cash and cash equivalents consist of cash in hand and balances with
scheduled banks. Refer note 20.
3 Balance with banks includes deposit amounting to ''861.86 (previous
year Rs.344.35) which are under lien.
4 Balance with banks includes balance in Escrow account amounting to
Rs.344.89 (previous year Rs.17.07).
5 Balance in unpaid dividend account is Rs.23.65 (previous year Rs.21.41)
6 The accompanying notes are an integral part of the financial
statements.
NOTE 1 COMPANY OVERVIEW
Minda Industries Limited is a public company domiciled and
headquartered in India. It was incorporated on 16 September 1992 under
the Companies Act, 1956 and its shares are listed on the National Stock
Exchange (NSE), Bombay Stock Exchange (BSE) and Delhi Stock Exchange
(DSE)*
*SEBI vide its order number VTM/PS/45/MRD/DSA/NOV/2014 dated 18th
November 2014 has withdrawn the recognitions granted to Delhi Stock
Exchange.
Company is engaged in the business of manufacturing of auto components
including auto electrical parts and its accessories. The Company caters
to both domestic and international markets.
(b) (i) Rights, preferences and restrictions attached to equity shares
The Company has only one class of equity shares having par value of Rs.10
per share. Each shareholder is entitled to one vote per share held. The
dividend proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing Annual General Meeting. In the event
of liquidation, the equity shareholders are eligible to receive the
remaining assets of the Company after distribution of all preferential
assets, in proportion to their shareholding.
(ii) Rights, preferences and restrictions attached to preference shares
The Company has issued 3% cumulative redeemable preference shares of
class ''C'' having par value of Rs.10 per share. Each Shareholder has
right to receive fixed preferential dividend at a rate of 3% on the
paid up capital of the Company. Preference shareholders also have
right to receive all notices of general meetings of the Company but no
right to vote at any meetings of the Company save to the extent and in
the manner provided in the Companies Act, 2013. Preference
shareholders neither have right to participate in any offer or
invitation by way of right or otherwise to subscribe additional shares
nor they have right to participate in any issue of bonus shares or
shares issued by way of capitalization of reserves.3,500,000 3%
Cummulative Redeemable Preference Shares of Rs.10 each have been allotted
on 17 February 2010, redeemable at par, after seven years from the date
of allotement. However, same can be redeemed earlier in view of
availability of profitability / surplus fund.
(f) Aggregate number and class of shares allotted as fully paid up
pursuant to contract(s) without payment being received in cash for the
period of five years immediately preceding the Balance Sheet date:
Equity shares includes
(i) 2,405,128 equity shares of Rs.10 each fully paid up issued during the
year 2010-11 for consideration other than cash to the shareholders of
Minda Autogas Limited, pursuant to the scheme of amalgamation.
(ii) 1,120,164 Equity Shares of Rs.10 each fully paid up issued during
the year 2011-12 for consideration other than cash to the shareholders
of Minda Acoustic Limited, pursuant to the scheme of amalgamation.
(iii) 1,835,000 equity shares of Rs.10 each fully paid up issued during
the year 2011-12 on conversion of 3% Cumulative compulsorily
convertible preference shares of Rs.2,187 each (Class ''B'').
(g) The Company has not allotted any bonus shares or bought back any
shares during the current year or for a period of five years
immediately preceding the balance sheet date.
Nature of security (including current portion of term loan ):
- from Axis Bank amounting to Rs.Nil (previous year Rs.208.33) is secured
by first pari passu charge over fixed assets, including plant and
machinery, furniture and fixtures, both present and future installed at
factory premises and goods purchased under Letter of Credit.
- from Axis Bank amounting to Rs.75 (previous year Rs.375) is secured by
first pari passu charge over fixed assets and second pari passu charge
over current assets and equitable mortgage of Company''s immovable
property at Gurgaon, Pune Sonepat and Pantnagar.
Terms of repayment and rate of interest
Total loan sanctioned amounting to Rs.2,500 (previous year Rs.2,500),
repayable in 24 quarterly instalments of Rs.104.17 each. Rate of
interest- 12.50%
Total loan sanctioned amounting to Rs.1,200 (previous year Rs.1,200),
repayable in 16 quarterly instalments of Rs.75 each.
Rate of interest- 12.50%
Nature of security (including current portion of term loan ):
- from HDFC Bank amounting to Rs.150 (previous year Rs.225) and is secured
by first pari passu charge on all the present and future immovable
assets and movable plant and machinery consisting of furniture and
fixtures, electrical fittings, vehicles, etc. property at Manesar,
Rasoi Sonepat, Plot No. -5, Sector - 10, Industrial Area, IIE Pant
Nagar, Udham Singh Nagar, Uttaranchal, Negative Lien on property at
B-6, MIDC, Chakan Industrial Area, Village mahalunge, Taluka Khed,
Distt. Pune. Second pari passu charge on all the book debts and stock
in trade both present and future.
- External Commercial Borrowings from Standard Chartered Bank amounting
to Rs.1,767.17 (previous year Rs.2,392.43), is secured by first pari passu
charge over all present and future movable fixed assets of the Company.
Second pari passu charge over all present and future book debts,
outstanding moneys receivables, claims and bills due and all present
and future stock in trade consisting of raw materials, finished goods,
goods in process of manufacturing and other merchandise etc.
- from HDFC Bank amounting to Rs.600 (previous year Rs.600) and is secured
by Exclusive charge on current assets of the company arising out of the
Chennai Plant. xclusive charge on movable and immovable fixed assets of
the company arising out of the Chennai Plant. Exclusive charge on land
and building (Chennai) standing in the name of the Company.
- from HDFC Bank amounting to Rs.1000 (previous year Rs.500) and is secured
by First Pari passu charge on all movable fixed assets of the company.
Second pari passu charge on all immovable fixed assets of the Company
as below;
i) Village Nawada, Fatehpur, PO Sikandarpur Badda, Manesar, Gurgaon.
ii) 34-35 KM, GT Karnal Road, Village Rasoi, Distt. Sonepat, Haryana.
iii) Plot no. -5, Sector - 10, Industrial Area, IIE Pant Nagar, Udham
Singh Nagar, Uttaranchal
iv) Plot no. 5A, Sector - 10, Industrial Area, IIE Pant Nagar, Udham
Singh Nagar, Uttaranchal.
v) Plot No ME-I and ME-II, Sector 2A, IMT Manesar, Gurgaon. Second
Pari passu charge on all present and future current assets of the
company
Terms of repayment and rate of interest
Total loan sanctioned amounting to Rs.2,000 (previous year Rs.2,000).
Disbursed amount of Rs.375 (previous year Rs.375) repayable in 20 quarterly
instalments of Rs.18.75 each.
Rate of interest- HDFC Base rate 1.50%
Total loan s anctioned amounting to USD 50 lac (previous year USD 50
lac), repayable in 16 quarterly instalments of USD 3.13 lac
Rate of interest- LIBOR 3%
Total loan sanctioned amounting to Rs.600 (previous year Rs.600).
Disbursed amount of Rs.nil (previous year Rs.600) repayable in 15 equal
quarterly instalments of Rs.40 each. Repayment to start from October
2015.
Rate of interest- HDFC Base rate 1.70%
Total loan sanctioned amounting to Rs.1,500 (previous year Rs.1,500).
Disbursed amount of Rs.500 (previous year Rs.500) repayable in 15 equal
quarterly instalments of Rs.100 each. Repayment to start from October
2015. Rate of interest- HDFC Base rate 1.7%
- Vehicle loans from banks amounting to Rs.20.96 (previous year Rs.76.38)
are secured against hypothecation of respective vehicles financed by
them.
- from HSIIDC amounting to Rs.261.42 (previous year Rs.525.94) and is
secured by charge on land at Bawal (Disclosed under deferred payment
liabilities -Secured)
- Sales tax incentive amounting to Rs.949.65 (previous year Rs.1,236.01)
from the State Government of Maharashtra, received in 2003-04
(Disclosed under deferred payment liabilities -Unsecured)
Total loan sanctioned amounting to Rs.1,051.88 (previous year Rs.1,051.88).
Disbursed amount of Rs.1,051.88 (previous year Rs.1,051.88) repayable in 8
half yearly instalments of Rs.131.48 each. Rate of interest- 11% p.a.
Total loan sanctioned amounting to Rs.1,427.25 (previous year Rs.1,427.25),
repayable in 8 annual instalments from 2013-14 Rate of interest-
Interest free
** Loan from Bajaj Finance Limited carries interest @ 10.65% p.a. and
is repayable maximum within 60 days in case of purchase order
discounting and 180 days in case of short term loan respectively.
* includes land amounting to Rs.1,402.85 (previous year Rs.1,402.85), yet
to be transferred in the name of the company.
** includes borrowing cost capitalised during the year of Rs.29.43
(previous year Rs.28.62).
*** Pursuant to the requirement of the Companies Act, 2013 ("the
Act") effective from 1st April, 2014, the company has revised
depreciation rates on certain fixed assets as per the useful life
specified in Part "C" of Schedule II of the Act or as per the
management''s estimate based on internal technical evaluation. As a
result of this change, the depreciation charge for the year ended 31
March, 2015 is higher by Rs.1,141.11. In respect of assets whose usefuyl
life is already exhausted as on 1 April, 2014, depreciation of Rs.264.46
(net of tax impact of Rs.136.17) has been adjusted in Reserves and
Surplus in accordance with the requirement of Schedule II of the Act.
refer note 35 on ''Impairment Loss''addition to assets Includes Rs.
585.46 towards R&D capital assets (previous year Rs. 134.37)
* includes land amounting to Rs.1,402.85 (previous year Rs.1,402.85), yet
to be transferred in the name of the company. ** includes borrowing
cost capitalised during the year of Rs.28.62 (previous year Rs.65.14).
* Trade receivables (unsecured, considered good) include Rs.180.26
(previous year Rs.270.37) due from private companies in which a director
is a director and Rs. 48.29 (previous year Rs.48.07) due from firms in
which director is a partner.
* includes Escrow account amounting to Rs.344.89 (previous year Rs.17.07)
** Deposit accounts amounting to Rs.861.86 (previous year Rs.344.35) is
lien under banks and other government authorities.
** As per section 135 of The Companies Act, 2013, CSR committee was
formed by the company. The area for CSR activities is promoting
education and self employment enhancement. A sum of Rs.88 was contributed
to Corpus Fund of S.L.Minda Charitable Trust and Moga Devi Charitable
Trust, the same has been utilised on CSR activities.
Note 3.1
Details of Research & Development Expenses booked in the respective
heads
The Company has incurred following expenses on its in-house research
and development centers at Manesar, Pune, Sonipat approved and
recognized by the Ministry of Science & Technology, Government of
India. Above expenses are included in under respective account heads.
(a) Claims made against the Company not acknowledged as debts
(including interest, wherever applicable):
Particulars Nature of the Amount Amount
dues 2014-15 2013-14
Income Tax Income Tax 7.48 7.48
Act, 1961
Income Tax Transfer
pricing - 686.00
Act, 1961 - Against
Section
143(3) and
Section 144C
Income Tax Income Tax 9.97 10.33
Act, 1961
Income Tax Income Tax 30.40 30.40
Act,1961
Income Tax Income Tax 1.52 1.52
Act, 1961
Paticular Period to which the Forum where dispute is
amount relates pending
Income Tax Act, 1961 Assessment year 2002- Referred back to AO
by 2003 Delhi
High Court
Income Tax Act, 1961 Assessment year 2006- Referred back to
Dispute
2007 Resolution
Panel by Income Tax
Appellate Tribunal
Income Tax Act, 1961 Assessment year 2007- Income Tax Appellate
2008 Tribunal
Income Tax Act, 1961 Assessment year 2009- Commissioner (Appeals)
of
2010 Income Tax
Income Tax Act, 1961 Assessment year 2010- Commissioner (Appeals)
2011 of Income Tax
Contingent liabilities relating to other cases Rs.11.30 (previous year
Rs.17.00).
Future cash outflows in respect of the above would be determinable on
finalization of judgments /decisions pending with various forums /
authorities.
(b) Corporate guarantee given by the Company and outstanding as at 31
March 2015 amounting to Rs.7,625(previous year Rs.8,450) in respect of
loans borrowed by related party. Further, the Company has also provided
a ''letter of comfort'' amounting to Rs.4,477(previous year Rs.4,477) in
respect of a loan taken by a related party from banks.
(c) As per an agreement executed with Maruti Suzuki India Ltd (MSIL)
under the ''Maruti Car Scheme'', a loan facility was granted to the
Company''s employees and other associates, whereby the Company has
guaranteed to repay the loan in case of any default. The amount
outstanding as at 31March 2015 is Rs. Nil (previous year Rs.3.49).
(d) The export obligations outstanding as at 31 March 2015 amount to
Rs.904.45(previous year Rs.2,207.63).
(e) The Company has availed sales tax incentives for its unit at
Gurgaon, Haryana, from the Government of Haryana as sales tax capital
subsidy amounting to Rs.225.65 (previous year Rs.225.65). In accordance
with Scheme of Government of Haryana for Development of Industries, the
amount may be refundable to the government, if specified conditions are
not fulfilled, within the prescribed time.
NOTE 4 CAPITAL AND OTHER COMMITMENTS (NET OF ADVANCE)
Estimated amount of contracts remaining to be executed on capital
account and not provided for (net of advances Rs.139.66) as at
31 March 2015 aggregates to Rs.867.03(previous year Rs.1,012.61, net of
advances Rs.388.72).
NOTE 5 IMPAIRMENT
(i) During the previous years, management had recorded an impairment
charge amounting to Rs.2,213.79 up to 31 March 2014, for the Battery
division located at Pantnagar, which was incurring continuous losses.
During the year, the binding sale agreement for transfer of business
was concluded on 1 October 2014. Accordingly, based on the net selling
price (lump sum consideration) and the fact that the Company has
entered into a binding sale agreement, impairment charge to the extent
of Rs.1,576.33 (net of depreciation of Rs.637.46) has been reversed as on
30 September 2014. The same has been disclosed as income under
''exceptional item'' in the Statement of Profit and Loss.
The company has recorded diminution other than temporary in value of
investment amounting to Rs.1,216.80 based on report of independent valuer
in respect of investment in MJ Casting Limited, a joint venture entity.
NOTE 6 ADDITIONAL INVESTMENT
The company has made an additional investment of Rs.49.50 in Minda Emer
Technologies Limited by acquiring 4, 95,000 equity shares of Rs.10 each
at par. The paid up capital of the Minda Emer Technologies Limited is
Rs.555 (previous year Rs.456).
NOTE 7
During the year 2002-03, the Director, Town and Country Planning,
Chandigarh issued a demand notice on the Company amounting to Rs.39.51
towards revised CLU (change of land use) charges for the land situated
at Village Nawada Fatehpur, P.O. Sikanderpur Badda, Gurgaon, and
Haryana. The Company paid Rs.1.58 and had also filed a Special Leave
Petition (SLP) with the Hon''ble Supreme Court of India, basis which a
leave had been granted. Further, the Company had deposited Rs.9.50 as
under protest with the authorities. During the earlier year, the
Company had filed a writ petition with the High Court of Punjab and
Haryana in order to cancel the demand notice and obtain a stay on the
balance demand. Further, the Company had withdrawn the petition and
accordingly had agreed to pay the total liability of Rs.39.51 and the
interest thereon amounting to Rs.37.51, towards revised CLU charges after
adjusting the amount of Rs.9.50 paid earlier.
During previous year, the Company has applied for grant of license
under ''Affordable housing Policy- 2013'' on the land measuring 9.9625
acres in revenue estate of Village Nawada, Fatehpur Sector-81, Gurgaon
and paid scrutiny fee (non-refundable) amounting to Rs.15.35 in this
respect.
On issue of license either under ''Residential Group Housing Colony
scheme'' or under ''Affordable housing policy 2013'', CLU charges would be
payable as per terms and conditions of the scheme.
Segment information is prepared in confirmity with the accounting
policies adopted for preparing and presenting the financial statements
of the Company as a whole.
The Company has one business segment ''Auto Components including auto
Electrical Parts and its accessories'' as primary segment. The
secondary segment is geographical, which is given as under: Rs. in Lac
Assets used in the Company''s business and liabilities contracted in
respect of its business activities, are not identifiable in line
with the above reportable segments as the assets and liabilities
contracted are used interchangeably between the segments.
Accordingly, except for trade receivables, no disclosure relating to
other segment assets and liabilities have been made.
NOTE 8 RELATED PARTY DISCLOSURES
(i) Related parties where control exists:
Subsidiaries Minda Auto Components Limited
Minda Kyoraku Limited
Minda Distribution and Services Limited
Global Mazinkert S.L., Spain
Clarton Horn S.A. Spain
Clarton Horn, Morocco
Clarton Horn, Asia
Clarton Horn, Signalakustik
Clarton Horn, Mexico
(ii) Other related parties with whom transactions have taken place
during the year/ previous year and the nature of related party
relationship:
Associates Auto Component (Firm)
Yogendra Engineering (Firm)
Mindarika Private Limited Minda NexGenTech Limited
Joint ventures(jointly controlled entities) M J Casting Limited
Minda Emer Techonologies Limited Key management personnel Mr. Nirmal K.
Minda, Chairman and
Managing Director(''CMD'')
Relatives of key management personnel Mrs. Suman Minda (wife of CMD)
Mrs. Paridhi Minda Jindal (daughter of CMD)
Mrs. Palak Minda (daughter of CMD)
Other entities over which key management personnel Minda Investments
Limited is able to exercise significant influence Minda International
Limited
Minda Corporation Limited Nirmal K. Minda (HUF)
Minda Industries (Firm)
Minda Automotive Limited Minda Spectrum Advisory Limited Samaira
Engineering (Firm)
S.M.Auto Industries (Firm)
Shankar Moulding Ltd.
Minda Stoneridge Instruments Ltd.
a) Defined contribution plan
An amount of Rs.755.76 (previous year Rs.671.55) for the year, has been
recognized as an expense in respect of the Company''s contribution
towards Provident Fund, deposited with the government authorities and
has been included under employee benefit expense in the Statement of
Profit and Loss.An amount of Rs.36.67 (previous year Rs.35.42) for the
year, has been recognized as an expense in respect of the Company''s
contribution towards Superannuation Fund, and has been included under
employee benefit expense in the Statement of profit and loss. Further
an amount of Rs.111.23 (previous year Rs.100.56) for the year, has been
recognized as an expense in respect of the Company''s contribution
towards ESI Fund, and has been included under employee benefit expense
in the Statement of profit and loss.
b) Defined benefit plans
Gratuity is payable to all eligible employees of the Company on
retirement/exit,death or permanent disablement in terms of the
provisions of the Payment of Gratuity Act.
The obligation for compensated absences is recognized in the same
manner as Gratuity.
The company is maintaining its gratuity trust with L.I.C. by the name
Minda Industries Limited Gratuity Trust. Accumulated contribution by
the company as on 31 March 2015 is Rs.325.44 (previous year Rs.150.07). LIC
is paying interest on this contribution annually which is considered as
income of the Trust. During the current year interest accrued on this
fund is Rs.26.87 (previous year Rs.18.88). Contribution by the company
during the current year is Rs.nil (previous year Rs.nil)
(viii) Principal actuarial assumptions at the Balance Sheet date are as
follows: a) Economic assumptions:
The principal assumptions are the discount rate and salary growth rate.
The discount rate is generally based upon the market yields available
on Government bonds at the accounting date with a term that matches
that of the liabilities and the salary growth rate taking account of
inflation, seniority, promotion and other relevant factors on long term
basis.
c) Transfer of employees
During the current year certain employees of MindaEmer Technologies
Limited (METL) were transferred to Minda Industries Limited (the
Company). As per the terms of the agreement, the liability on account
of gratuity and compensated absences for employee uptil date of
transfer will be borne by METL. The amount receivable from METL towards
gratuity is Rs.7.25 (previous year Rs.7.25).
NOTE 9
The Ministry of Micro, Small and Medium Enterprises has issued an
Office Memorandum dated 26 August 2008 which recommends that the Micro
and Small Enterprises should mention in their correspondence with their
customers the Entrepreneurs Memorandum number as allocated after filing
of the said Memorandum. Accordingly, the disclosures in below respect
of the amounts payable to such enterprises as at the yearend has been
made based on information received and available with the Company.
The Company has made a warranty provision on account of sale of
components. These provisions are based on management''s best estimate
and past trends. Actual expenses for warranty are charged directly
against the provision. Un-utilized provision is reversed on expiry of
the warranty period.
NOTE 10 LEASES
The Company has taken offices on cancellable operating leases. The
lease rentals recognised in the Statement of Profit and Loss for the
year 31 March 2015 is Rs.1,061.08 (Previous Year Rs.1,020.24)
The purpose of entering into a forward exchange contract is to hedge
the foreign currency exposure on payment from debtors. During the
current year, the Company has not entered into any derivative
instrument for speculation purpose.
NOTE 11
During the year ended 31 March 2012, one of the manufacturing
facilities of the Light division at Pune had incurred loss of fixed
assets and inventory on account of fire. During the year, the Company
has received final claim of Rs.27.52 as full and final settlement of the
insurance claim. The same has been disclosed as an ''Exceptional item''
in the Statement of Profit and Loss.
NOTE 12
Capital Work in Progress includes borrowing cost capitalised during the
year amounting to Rs. Nil (previous year Rs.28.62)
NOTE 13
The Company has established a comprehensive system of maintenance of
information and documents are required by the transfer pricing
legislation under section 92-92F of the Income Tax Act, 1961. Since the
law requires existence of such information and documentation to be
contemporaneous in nature, the Company is in the process of updating
the documentation for the transactions entered into with the associated
enterprises during the financial year and expects such records to be in
existence latest by due date as required under the law. The management
is of the opinion that its transactions with the associated enterprises
are at arm''s length so that the aforesaid legislation will not have any
impact on the financial statements, particularly on the amount of tax
expense and that of provision for taxation.
