About
Forbes & Company Ltd
Forbes & Company Ltd, formerly known as Forbes Gokak Ltd, is one of the oldest companies of the world that is still in existence. The company operates with a diversified portfolio comprising Engineering, Industrial Automation, Consumer Durables (Water and Air Products), Chemical Tankers and Real Estate. Forbes & Company is part of the Shapoorji Pallonji Group. Its parent and ultimate holding company is Shapoorji Pallonji and Company Private Limited.
Forbes & Company Ltd is having its manufacturing facilities located at Aurangabad, Thane and Mumbai in Maharashtra and Hosur in Tamil Nadu. The Engineering Division comprises precision tools, business automation, coding business, motor manufacturing, measuring instruments and turbine agency. The Realty Division has been set up for creating value from the real estate owned by the company at various locations.
The company traces their origin to the year 1767, when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the management of the company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group, leaders in infrastructure, construction and real estate businesses, amongst many others.
Forbes & Company Ltd was originally incorporated on November 18, 1919 under the name The Gokak Mills Ltd. In the year 1972, Patel-Volkart Ltd was amalgamated with the company with effect from June 30, 1972 and the name was changed to Gokak Patel Volkart Ltd on December 31, 1973. In the year 1979, the company undertook a modernization programme involving an outlay of Rs 366 lakh.
In the year 1983, the company acquired a hydro power generating set of 1 Megawatt capacity. In the year 1989, they acquired the spinning unit at Vadodara having an installed capacity of 25 000 spindles, which was named as Gokak Vadodara Spinning Mills. Also, they set up a textile mill in Indonesia with a capacity of 30,000 spindles during the year.
In the year 1992, Forbes Campbell & Co Ltd was amalgamated with the company and the name of the company was changed to Forbes Gokak Ltd with effect from September 28, 1992. In the year 1995, the company commissioned new 15,000 spindles cotton yarn EOU project at Gokak Falls. In the year 1999, the company and Barwil Agencies of Wilh Wilhemsed Norway formed a joint venture company for providing shipping agency transport logistics and related services in India with their headquarters in Mumbai.
During the year 2001-02, the company undergone a restructuring in the shareholding pattern and Shapoorji Pallonji Group acquired a majority stake of the share capital of the company and Forbes Gokak Ltd became a subsidiary of Shapoorji Pallonji & Company Ltd. Also, the company made a tie up with DAKS Simpson for licensing rights for distribution of DAKS products in India. In the year 2003, they became a company in the Pallonji Mistry's lottery venture Dhandhanadhan Infotainment as the company bought out 49% holding in Dhandhanadhan for a consideration of Rs 5.88 crore.
During the year 2003-04, Bradma of India Ltd and Champbell Knitwear Ltd, wholly owned subsidiaries of the company were amalgamated with the company with effect from April 1, 2003. Also, the company entered into a marketing tie up with DAKS Simpson British apparel major to manufacture & market DAKS range of brands in India.
During the year 2004-05, the company set up first overseas subsidiary, namely Forbes Sterling Star Ltd, which owns an 11138 gross ton, RORO Container Ship, named, M V X-Press Alexander. The company installed new equipments, namely Autostriper Machines, Jacquard Collar Machines and T-Shirt printing machines, which are operating at full capacities. Also, the company bought 19,80,000 shares of Eureka Forbes Ltd for aggregate amount of Rs 524.20 million and thus Eureka Forbes Ltd became a wholly owned subsidiary of the company.
During the year 2005-06, the FAL Industries Ltd was amalgamated with the company with effect from April 1, 2005. The company increased the yarn dyeing capacity from 10 MT to 15 MT per day. Forbes Patvolk Shipping division entered into a strategic alliance and set up a joint venture company, Forbes Bumi Armada Ltd for looking after the offshore markets.
During the year, the company together with the Sterling Investment Corporation Pvt Ltd, the holding company entered into an agreement with the Shipping Corporation of India Ltd for setting up a joint venture company to own and operate vessels. Also, the company promoted Forbes Edumetry Ltd and Edumetry Inc USA, which are engaged in the business of creating a value in the process of education measurement at international level.
During the year 2006-07, the company commissioned K441 Reiter Ring Frames to produce compact yarn for a better price realization. Also, they commissioned Container Freight Station at Veshvi near JNPT. The company set up joint venture company, namely SCI Forbes Ltd as a part of a process to seek alliance and benefits from mutual strengths. They sold a vessel named 'X-Press Alexander' during the year.
The company's Forbes Precision Tools division entered into marketing alliance with a Swiss company for trading in high performance tools, which improved their presence in the high-end tools market. Also, the division installed CNC grinding machines for manufacture of Solid Carbide Custom Tools, which cater to new application segments resulting into a higher unit realization. In June 2007, the company commissioned Container Freight Station at Mundra.
The company de-merged their Textiles Undertaking, which include Yarn business with their manufacturing unit at Gokak Falls in Karnataka and Knitwear business with their manufacturing unit at Marihal in Karnataka into a separate company, namely Gokak Textiles Ltd with effect from April 1, 2007. Subsequently, the name of the company was changed from Forbes Gokak Ltd to Forbes & Company Ltd with effect from October 25, 2007.
Forbes Campbell Holdings Ltd and Warrior (Investment) Ltd, two investment subsidiaries of the company were amalgamated into another investment subsidiary namely, Forbes Finance Ltd with effect from June 1, 2007.
During the year 2008-09, the company made an additional investment of Rs 307.90 million in the equity shares of Forbes Finance Ltd, a wholly owned subsidiary company. Further, Forbes Finance Ltd has made investment of Rs 1500 lakh in the equity shares of Forbes Technosys Ltd by subscribing to the rights issue and purchase of shares from another subsidiary, namely Eureka Forbes Ltd. Thus, Forbes Technosys Ltd became a subsidiary of Forbes Finance Ltd.
During the year ended 31 March 2014, the initiatives taken by Forbes & Company's Precision Tools Group (PTG) business vertical to strengthen its market position included modernising the production facilities for better product quality, improvement in operational efficiencies and also in customer services. Operational excellence initiatives were undertaken in collaboration with The Confederation of Indian Industry (CII). ISO certification for the Fasteners was obtained.
There were continuous efforts to improve exports to the Middle East and the South East Asian markets, resulting in extension to new territories like Turkey, Croatia, Vietnam and Brazil. The new customers added, include, Honda Motorcycles, TSVZ Rail Wagon Factory in Russia, Uljanik Pula (shipyard in Croatia) and Walton Industries (a white good manufacturer), Bangladesh for High Performance Tools.
During the year under review, Forbes & Company's Coding Business Group (CBG) business vertical commenced in-house assembling of machines, automation systems and integrated testing at the company's Aurangabad plant to offer comprehensive services to automobile and engineering industries.In 2013-14, the company's Energy Solutions Group (ESG) business vertical spent a lot of time and effort on streamlining the operations. The restructuring exercise was conducted of the operations and all critical procedures and processes were reviewed and integrated into the existing Enterprise Resource Planning (ERP). Large Turnkey Projects undertaken in previous year(s) were executed and a few of them were commissioned. The last quarter of the FY 2013-14 generated a number of orders which will be executed in the FY 2014-15.
During the year under review, Eureka Forbes Limited (EFL) completed a successful acquisition of 100% stake in Lux International AG through its wholly owned subsidiaries. Lux International AG has operations in 35 countries with a major presence in Switzerland, Germany, Hungary, Czech Republic, Italy, Paraguay, Slovakia and South Africa.
Direct product deliveries to Customers, introduction of World 1, a new breed of Direct Sales World Stars leading the way for high value selling and initiatives like the new 'rental scheme' - Har Ghar Mein Aquaguard and growing hire-purchase sales through Euro Value, helped the transformation of Direct Sales division. The thrust on e-commerce, 'end to end' lead generation and management and new initiatives like foray into TV Shopping, the launch of Euroviva, a range for healthy cooking together with the growing partner business, helped consolidate its position.
The Consumer Division continued its strategic focus on retail expansion by implementing successfully, pan India, an online territory mapping process coupled with the launch of a state of the art secondary tracking system. This system connects EFL to all its trade partners and gives on line visibility of the trade partners retail coverage and business health. Based on extensive consumer research, the division launched in retail its first ever 'Taste Guard' technology that delivers the same sweet taste irrespective of the input water source. The retail business further consolidated its No. 1 position in the fast growing modern, organised trade as well in the ever expanding regional retail chains.
The Packaged Drinking Water (PDW) business expanded further its franchisees and distribution reach to 31 live franchisees across 7 states that collectively dispensed 70 Million litre of Aqua Sure PDW water since launch.
During the year under review, Forbes Technosys Limited (FTL) received orders from a large number of PSU Banks & Private Banks who implemented their plans to set up Fully Electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL also received orders from neighboring countries like Nepal and Bhutan. Pursuant to the RBI mandate for implementation of Cheque Truncation Systems in Western Grid and extension of Southern Grid, FTL's Cheque Truncation Solution was the leading solution that got implemented in 70 plus banks across the entire western grid including leading PSU banks. FTL ventured into various new segments of Government, and supplied Kiosks to Judiciary, State Transport Corporations, and Department of Land Records, Collectorate, Defence and Research Centers, as an alternate delivery channel for a variety of e-Governance Services to consumers. FTL made an entry into the Enterprise Mobility Market and secured impressive orders from large corporates and banks.
Forbes Container Line Pte. Limited (FCL) made a record profit of SGD 1.6 million (approximately Rs 7 crore) during the financial year ended 31 March 2014. FCL improved its container fleet by leasing and improving the inventory to 7500 TEUs. FCL also participated in the India Vietnam trade. Forbesline Shipping Services LLC, a subsidiary of FCL, which has been set up in Dubai, started operations since June 2013.
During the period under review, SCI Forbes Limited (SCIF) was unable to service the debt and the lenders imposed a condition of accelerated loan recovery as a result of continuing default. The lenders filed a claim for recovery of the loan and costs in the Commercial Court in London. SCIF seeks to refinance the outstanding debt through another ECB facility. SCIF has been sanctioned a fresh ECB loan from Axis Bank Ltd. to the tune of USD 35 Million. SCIF has received an 'in-principle' approval from the Reserve Bank of India for repayment of existing ECB from the proceeds of the fresh ECB facility from Axis Bank Ltd.
During the year ended 31 March 2014, Forbes & Company continued to invest in its subsidiary companies. During the year under review Rs 3.95 crores was invested in Forbes Bumi Armada Offshore Limited and Rs 7.50 crores in Forbes Campbell Finance Limited. 1 Crore 1% Compulsory Convertible Optionally Redeemable Debentures of Rs 10 each held by the company in Forbes Technosys Limited have been converted on March 28, 2014 into 1 crore equity shares of Rs 10 each.
2014-15 was a year of consolidation and correction for Forbes & Company's Precision Tools Group (PTG) business vertical. The major focus was on the development of high performance product lines which suits different material applications. The design & development team developed products which are at par with international competitors. A new series of product lines was developed for the automobile segment to cater to the changing productivity demand of the industry. PTG established a capacity of 60 MT per month of Spring Washer facility catering to major auto Original Equipment Manufacturers (OEM) with zero defect assurance.
During the year under review, the PTG business vertical initiated diversification into the non-auto sector.
The initiatives taken by the company to strengthen its market position included modernizing the production facilities for better product quality, improvement in operational efficiencies and also in customer services. Operational excellence initiatives were undertaken under the 'Adapt, Change, Excel' (ACE) Program. There were continuous efforts to improve exports to the Middle East and the South East Asian markets and there were successful breakthroughs in Eastern Europe for taps.
With regard to Forbes & Company's Coding Business Group (CBG) business vertical, the highlights of automation solutions during the year were development of the first of its kind Optical Vision System Sorting Machine, Laser Marking systems, Automated assembly line for Water Filter cartridge assembly, Laser marking with 2D scanning & development of MES integrated system for a big automobile OEM. New initiatives included providing Traceability Software and Product development initiatives included handheld low cost marking device.
FY 2014-15 was dedicated to restructuring and streamlining the complete operations of Forbes & Company's Energy Solutions Group (ESG) business vertical. ESG was integrated into the existing Enterprise Resource Planning (ERP) quite successfully during FY 2014-15. The laid down processes and procedures also brought ESG successfully under the International Organization for Standardization (ISO) Coverage. The Certification Audit of ESG was conducted in the 1st Quarter of the financial year by SGS and was successful. There were a number of Drive Turbine enquiries wherein ESG was successful in bidding as well as executing.
In FY 2014-15, Eureka Forbes Limited (EFL) as one dominating force, expanded its markets, executed its strategies, evolved as individuals and excelled in performance, to make EFL group a Global Multi-National Corporation. The Aquasure Packaged Drinking Water (PDW) brand became available in over 24,000 outlets in 32 cities through 36 franchises, dispensing 41 million litres of water. The brand is now available across several prestigious clients. The Eurovigil Security Systems Brand secured prestigious multi-locational orders from several prestigious clients for Intrusion Alarm and Surveillance Systems (CCTV).
The water projects team made a foray into desalination plants by bagging and executing the first Diesel plant order from Toshiba, Japan for a power plant in Philippines.
During the year under review, Forbes Technosys (FTL) continued to establish leadership in e-lobbies, Cash Deposit kiosks, Passbook Printing Kiosks, Ticket Vending Machines, Information Kiosks and Coin Vending Machines. FTL received orders from a large number of PSU banks and Private Banks who implemented their plans to set up fully electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL also received large orders from Telecom Companies and Public Utilities for the deployment of Bill Payment Kiosk. FTL made significant investments in infrastructure creation, expansion of offices, service network, new product development and exports. FTL also recorded significant growth in its e-payments business and also launched an online portal for recharge, bill payments etc. to address the card users and Internet Banking segment. FTL made an entry into the Transportation sector by securing impressive orders from the Indian Railways for ATVMs (Automatic Ticket Vending Machines).
During the year, Forbes & Company incorporated a wholly owned subsidiary viz., Campbell Properties & Hospitality Services Limited. Forbes Campbell Finance Limited, a wholly owned subsidiary of the company, divested its entire shareholding (50% shareholding in the Joint Venture) in Nypro Forbes Products Limited.
During the year ended 31 March 2016, Forbes & Company's Precision Tools Group business vertical brand Totem strengthened its position as a leading brand in the domestic market and made good strides in the global space. High performance Taps led the way with success in China for application on super alloys and difficult-to-machine materials. Solid Carbide end mills found their niche in Eastern Europe and the progress continues. A series of product extensions and new business areas were tapped. Spring Lock Washers won a certification from the Power Grid Corporation of India, paving the way for entry in the power sector. The Precision Tools Group division continued with its 'Adapt, Change, Excel' (ACE) program - to be nimble and swift in business execution.
With regard to the company's Coding Business Group (CBG) business vertical, enhancement in the in-house facility, with addition of laser markers and testing equipment in the factory helped better service to Original Equipment Manufacturer (OEMs). The launch of Bradma lasers with variants of Fiber, Carbon Dioxide (CO2) had good acceptance in the Indian market. CBG also started catering to the valve and heavy engineering industry. Venturing into the Marking Software space, Bradma developed the interface for SAP integration with the user's marking assembly for one of the leading two-wheeler manufacturers in India.
In FY 2015-16, the Direct Sales Division of Eureka Forbes Limited (EFL) once again proved its mettle to stay ahead of the game with 'Category First' initiatives like; Paani-ka-Doctor clinics (Smaller offices to improve visibility and expand reach) and rental sales. Eurosmile, EFL's customer service division established a wide service network and exceeded 10 million customer visits during the year, catering to 15 million installation bases in India. The Aquasure Packaged Drinking Water (PDW) brand became available in over 24,000 outlets in 32 cities through 36 franchisees dispensing 41 million litres of water. The Eurovigil security systems brand secured prestigious multi-locational orders from clients like the MRF, ITC Wills Life Style and ITC Classmate for Intrusion Alarm and Surveillance Systems (CCTV).
Eureka Forbes Limited and Process Research Ortech, Canada, joined hands in bringing a unique technology of Automated Variable Filtration (AVF) technology to India for high quality water filtration thereby reducing costs in an environment friendly manner.
Forbes Facility made a successful entry into the Offshore Business' of housekeeping and catering with Forbes Bumi Armada Offshore Limited.
FY 2015-16 was a year of consolidation for Forbes Technosys Limited (FTL) across its business verticals and product range in a challenging business environment particularly for the ATM, Cash Deposit and Recycler, Sorter and Coin Vending business segment as Banks had put procurement plans on a hold due to the withdrawal of subsidies by the Reserve Bank of India, in June 2015. During the year under review, FTL continued to establish leadership in e-lobbies, Passbook Printing Kiosks and Automatic Ticket Vending Machines. FTL received and executed a large order for Passbook Printing Kiosks from the State Bank of India, the largest single deployment of Passbook Printing Kiosks in a single year in India so far. FTL also got major orders from the Corporation Bank and, the Union Bank of India who, using hardware manufactured by FTL, set up fully electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL had an impressive foray into the Transportation segment and received significant orders from the Indian Railways across the country for over 1000 ATVMs (Automatic Ticket Vending Machines) including Cash based ATVMs.FY 2015-16 saw the successful launch of the Domestic Money Transfer business of Forbes Xpress which operates through a network of franchisees that also provide other services like recharging, bill payments and ticketing.
Forbes Bumi Armada Limited (FBAL) commenced provision of manning services after receiving Recruitment and Placement Services License from the Director General of Shipping.
During FY 2015-16, Lux Aqua GMBH, Switzerland and Lux Aqua (HU) Hungary were incorporated as wholly owned subsidiaries of Lux International AG and Lux Aqua GMBH respectively.
During the year ended 31 March 2017, Forbes & Company's Precision Tools Group (PTG) business vertical continued efforts to introduce new products to the market in Carbide Raw Material, Expansion of High Performance Taps product portfolio, introduction of Solid Carbide Long Series Drills and expansion of HSS drill range. New dealers introduction, a strong initiative taken in FY 2016-17, has been made across the country and continues to be an ongoing process to expand reach and growth in the business. Introduction of New Technologies in the field of Heat Treatment, Geometric measurements and Edge preparation in manufacturing has led to product quality enhancement to compete against best in class. Substantial investments were made in Waluj Facility during the year.
With regard to the company's Coding Business Group (CBG) business vertical, FY 2016-17 was the year of consolidation for automation business. CBG introduced integrated marking solutions with software, coding & decoding, scanning/Vision systems. During this year, CBG was able to provide automation system as an import substitute to one of the leading two-wheeler manufacturer and achieved success by exporting a fully integrated system to Egypt, which was also a first for the company. CBG started assembly of laser optics in Waluj Factory with its own system controls. Industry 4.0 solution was implemented for automotive industry which is going to be one of the future revenue stream. The CBG division continued with its 'Adapt, Change, Excel' (ACE) program- to be nimble and swift in business execution from product selling company to solution provider.
In the electric water purifier space, Eureka Forbes Limited (EFL) regained a 12% market share in the financial year 2015-16 taking EFL market share to 67% and retained the same in the financial year 2016-17. The year also witnessed the business composition change where the Retail Channel (Consumer Division) and Partner Channels (Franchise Direct Operators & Franchise Business Partners in Direct Sales) grew while the one time core business of Customer Response Centre (CRC business of Direct Sales) de-grew marginally vis-a-vis last year, this was mainly due to unbudgeted increase in wage bill. During the year under review, EFL launched the first 'Made in India for the world' Air Purifier Aeroguard 4S.
The focus on digitisation resulted in fruits with over 350,000 validated leads and Rs1000 million turnover from digital platform resulted in a quantum growth over previous year. Unlike the e-com wave of discounts EFL held the price and strategic partnership with 'Google' helped EFL dominate in the space with over 70% Share of Voice in the categories EFL has been present in. Additionally mobility both in Sales & Service began to show early benefits. On the international front, opening of business to business segment, new channels i.e. Retail, e-tail and party plans together with opening of 10 new markets, re-organisation of operations, cost-optimisation drive, elimination of non value adding services, focus on core business and a new category of mattresses had been the thrust during year gone by.
FY 2016-17 was a year of consolidation for Forbes Technosys Limited (FTL) across its business verticals and product range in a challenging business environment. The second half of FY 2016-17 was impacted by the Demonetization drive of the Government. FTL's major customer being banks, this impacted the sale of all banking equipment and given the predominance of banking in FTL's business portfolio, this caused a sharp impact on sales during the second half of the year as FTL's key customers were focused on addressing the public needs arising out of Demoetization.
Sales of Forbes Xpress offerings were also adversely affected due to non/limited availability of cash during the months from November 2016 to March 2017. The entry of a major telecom player, who offered free services from October 2016 to March 2017, impacted other Telecom players whose prepaid pack business was impacted and therefore FTL's business was impacted with them. Therefore, FTL had to shift focus on generating margins from services, as other revenue streams were impacted. Services showed over 100% increase in revenues over the previous year and helped improve profitability. During the year under review, FTL had an impressive foray into the insurance sector, with the introduction of self-service solutions for the same.
In sync with the long term strategy of Forbes & Company's to exit those businesses which were not a strategic fit with the long term vision of company and in a manner that optimizes value, the company has during the FY 2016-17, exited its Container Freight Stations and Logistics businesses and received a consideration of Rs. 963 millions. The company also sold its entire shareholding (50.001%) in Forbes Bumi Armada Offshore Limited, a joint venture with Bumi Armada Berhad to Shapoorji Pallonji Oil and Gas Private Limited at a consideration of Rs. 125 millions.
During FY 2016-17, Lux Professional GmbH, Lux Osterreich Professional GmbH, Lux Aqua Paraguay SA, Lux Aqua Czech s.r.o, Lux Waterline GmbH and Brightclean (Spain) S.L were incorporated/have become wholly owned subsidiaries of Lux Professional International GmbH.
The year 2017-18 was an eventful year for Forbes & Company with many events playing its part and impacting the organisation substantially. Across businesses the company has renewed leadership at some levels, built a highly supportive customers, and motivated team with a solid action plan to improve financial returns.
During the year under review, the company's Precision Tools Group (PTG) business vertical introduced long drills in carbide for automotive application which has 100% growth with specific success in applications of Crankshaft oil hole drilling, drilling of Automotive special parts & Mining drills. PTG's other initiatives during the year included investment & capacity enhancement in manufacturing HSS drills at Waluj, Aurangabad for improved product margins & availability. Spring washer facility in Waluj, Aurangabad got approved by one of the major international fastener giants.
The company's Industrial Automation business under its Coding Business Group (CBG) business vertical has proved its mettle in line automation projects done for a leading four wheeler manufacturer in India. Clutch Assembly & Gear Box Assembly lines were successfully installed & commissioned. Large-value CBG automation orders from big automotive OEM companies are one of significant achievements in FY 2018 for the projects business. During the year, some product lines were moved from Chikalthana to Waluj.
During the year under review, the company invested Rs 10 crore in Preference Shares of Forbes Technosys Limited, a wholly owned subsidiary of the company.
During the year under review, Eureka Forbes Limited (EFL) continued to drive innovation across brands, categories, operations and adapted the go-to-market strategies, taking into account the diversity, market needs, and the evolving channels of distribution. EFL continued to lead the digital transformation within and leveraged its Direct Sales capabilities to drive competitive advantage. EFL grew in the fast emerging e-commerce channel supported by Eurochamps and its Retail and Institutional efforts to assist the customers across the length and breadth of India continued. Most importantly, EFLs brands and operations continued to be held together by its firm belief/purpose to be Friend for Life'.
During the year under review, Forbes Technosys Limited (FTL) continued its growth across multiple sectors and dimensions, albeit with pressures on revenue growth. GST though beneficial in long term, in the year under review, posed several issues related to re-classification of goods and services as well as reconfiguration of GST by the company's customers impacted the velocity and scale of business. In these circumstances, FTL chose to consolidate across its business verticals and product range in a challenging business environment and increase in service and solution revenue. Forbes Xpress, FTL's e-payments services platform, continued to grow both in terms of scale, franchisee numbers and geographic presence. During the year, development effort for launching the Bharat Bill Payment System (BBPS) was undertaken and was launched on schedule.
In January 2018, Shapoorji Pallonji Forbes Shipping Limited (SPFSL, formerly SCI Forbes Limited) acquired one 2006 Japanese built vessel with stainless steel tanks of 20,938 mt dwt (MT Saranga) increasing the total dwt capacity of the company to 73,424 mt. SPFSL is the only company in India that owns chemical tankers.
Forbes & Company Ltd
Company History
Forbes & Company Ltd, formerly known as Forbes Gokak Ltd, is one of the oldest companies of the world that is still in existence. The company operates with a diversified portfolio comprising Engineering, Industrial Automation, Consumer Durables (Water and Air Products), Chemical Tankers and Real Estate. Forbes & Company is part of the Shapoorji Pallonji Group. Its parent and ultimate holding company is Shapoorji Pallonji and Company Private Limited.
Forbes & Company Ltd is having its manufacturing facilities located at Aurangabad, Thane and Mumbai in Maharashtra and Hosur in Tamil Nadu. The Engineering Division comprises precision tools, business automation, coding business, motor manufacturing, measuring instruments and turbine agency. The Realty Division has been set up for creating value from the real estate owned by the company at various locations.
The company traces their origin to the year 1767, when John Forbes of Aberdeenshire, Scotland started his business in India. Over the years, the management of the company moved from the Forbes Family to the Campbells to the Tata Group and now finally to the well known Shapoorji Pallonji Group, leaders in infrastructure, construction and real estate businesses, amongst many others.
Forbes & Company Ltd was originally incorporated on November 18, 1919 under the name The Gokak Mills Ltd. In the year 1972, Patel-Volkart Ltd was amalgamated with the company with effect from June 30, 1972 and the name was changed to Gokak Patel Volkart Ltd on December 31, 1973. In the year 1979, the company undertook a modernization programme involving an outlay of Rs 366 lakh.
In the year 1983, the company acquired a hydro power generating set of 1 Megawatt capacity. In the year 1989, they acquired the spinning unit at Vadodara having an installed capacity of 25 000 spindles, which was named as Gokak Vadodara Spinning Mills. Also, they set up a textile mill in Indonesia with a capacity of 30,000 spindles during the year.
In the year 1992, Forbes Campbell & Co Ltd was amalgamated with the company and the name of the company was changed to Forbes Gokak Ltd with effect from September 28, 1992. In the year 1995, the company commissioned new 15,000 spindles cotton yarn EOU project at Gokak Falls. In the year 1999, the company and Barwil Agencies of Wilh Wilhemsed Norway formed a joint venture company for providing shipping agency transport logistics and related services in India with their headquarters in Mumbai.
During the year 2001-02, the company undergone a restructuring in the shareholding pattern and Shapoorji Pallonji Group acquired a majority stake of the share capital of the company and Forbes Gokak Ltd became a subsidiary of Shapoorji Pallonji & Company Ltd. Also, the company made a tie up with DAKS Simpson for licensing rights for distribution of DAKS products in India. In the year 2003, they became a company in the Pallonji Mistry's lottery venture Dhandhanadhan Infotainment as the company bought out 49% holding in Dhandhanadhan for a consideration of Rs 5.88 crore.
During the year 2003-04, Bradma of India Ltd and Champbell Knitwear Ltd, wholly owned subsidiaries of the company were amalgamated with the company with effect from April 1, 2003. Also, the company entered into a marketing tie up with DAKS Simpson British apparel major to manufacture & market DAKS range of brands in India.
During the year 2004-05, the company set up first overseas subsidiary, namely Forbes Sterling Star Ltd, which owns an 11138 gross ton, RORO Container Ship, named, M V X-Press Alexander. The company installed new equipments, namely Autostriper Machines, Jacquard Collar Machines and T-Shirt printing machines, which are operating at full capacities. Also, the company bought 19,80,000 shares of Eureka Forbes Ltd for aggregate amount of Rs 524.20 million and thus Eureka Forbes Ltd became a wholly owned subsidiary of the company.
During the year 2005-06, the FAL Industries Ltd was amalgamated with the company with effect from April 1, 2005. The company increased the yarn dyeing capacity from 10 MT to 15 MT per day. Forbes Patvolk Shipping division entered into a strategic alliance and set up a joint venture company, Forbes Bumi Armada Ltd for looking after the offshore markets.
During the year, the company together with the Sterling Investment Corporation Pvt Ltd, the holding company entered into an agreement with the Shipping Corporation of India Ltd for setting up a joint venture company to own and operate vessels. Also, the company promoted Forbes Edumetry Ltd and Edumetry Inc USA, which are engaged in the business of creating a value in the process of education measurement at international level.
During the year 2006-07, the company commissioned K441 Reiter Ring Frames to produce compact yarn for a better price realization. Also, they commissioned Container Freight Station at Veshvi near JNPT. The company set up joint venture company, namely SCI Forbes Ltd as a part of a process to seek alliance and benefits from mutual strengths. They sold a vessel named 'X-Press Alexander' during the year.
The company's Forbes Precision Tools division entered into marketing alliance with a Swiss company for trading in high performance tools, which improved their presence in the high-end tools market. Also, the division installed CNC grinding machines for manufacture of Solid Carbide Custom Tools, which cater to new application segments resulting into a higher unit realization. In June 2007, the company commissioned Container Freight Station at Mundra.
The company de-merged their Textiles Undertaking, which include Yarn business with their manufacturing unit at Gokak Falls in Karnataka and Knitwear business with their manufacturing unit at Marihal in Karnataka into a separate company, namely Gokak Textiles Ltd with effect from April 1, 2007. Subsequently, the name of the company was changed from Forbes Gokak Ltd to Forbes & Company Ltd with effect from October 25, 2007.
Forbes Campbell Holdings Ltd and Warrior (Investment) Ltd, two investment subsidiaries of the company were amalgamated into another investment subsidiary namely, Forbes Finance Ltd with effect from June 1, 2007.
During the year 2008-09, the company made an additional investment of Rs 307.90 million in the equity shares of Forbes Finance Ltd, a wholly owned subsidiary company. Further, Forbes Finance Ltd has made investment of Rs 1500 lakh in the equity shares of Forbes Technosys Ltd by subscribing to the rights issue and purchase of shares from another subsidiary, namely Eureka Forbes Ltd. Thus, Forbes Technosys Ltd became a subsidiary of Forbes Finance Ltd.
During the year ended 31 March 2014, the initiatives taken by Forbes & Company's Precision Tools Group (PTG) business vertical to strengthen its market position included modernising the production facilities for better product quality, improvement in operational efficiencies and also in customer services. Operational excellence initiatives were undertaken in collaboration with The Confederation of Indian Industry (CII). ISO certification for the Fasteners was obtained.
There were continuous efforts to improve exports to the Middle East and the South East Asian markets, resulting in extension to new territories like Turkey, Croatia, Vietnam and Brazil. The new customers added, include, Honda Motorcycles, TSVZ Rail Wagon Factory in Russia, Uljanik Pula (shipyard in Croatia) and Walton Industries (a white good manufacturer), Bangladesh for High Performance Tools.
During the year under review, Forbes & Company's Coding Business Group (CBG) business vertical commenced in-house assembling of machines, automation systems and integrated testing at the company's Aurangabad plant to offer comprehensive services to automobile and engineering industries.In 2013-14, the company's Energy Solutions Group (ESG) business vertical spent a lot of time and effort on streamlining the operations. The restructuring exercise was conducted of the operations and all critical procedures and processes were reviewed and integrated into the existing Enterprise Resource Planning (ERP). Large Turnkey Projects undertaken in previous year(s) were executed and a few of them were commissioned. The last quarter of the FY 2013-14 generated a number of orders which will be executed in the FY 2014-15.
During the year under review, Eureka Forbes Limited (EFL) completed a successful acquisition of 100% stake in Lux International AG through its wholly owned subsidiaries. Lux International AG has operations in 35 countries with a major presence in Switzerland, Germany, Hungary, Czech Republic, Italy, Paraguay, Slovakia and South Africa.
Direct product deliveries to Customers, introduction of World 1, a new breed of Direct Sales World Stars leading the way for high value selling and initiatives like the new 'rental scheme' - Har Ghar Mein Aquaguard and growing hire-purchase sales through Euro Value, helped the transformation of Direct Sales division. The thrust on e-commerce, 'end to end' lead generation and management and new initiatives like foray into TV Shopping, the launch of Euroviva, a range for healthy cooking together with the growing partner business, helped consolidate its position.
The Consumer Division continued its strategic focus on retail expansion by implementing successfully, pan India, an online territory mapping process coupled with the launch of a state of the art secondary tracking system. This system connects EFL to all its trade partners and gives on line visibility of the trade partners retail coverage and business health. Based on extensive consumer research, the division launched in retail its first ever 'Taste Guard' technology that delivers the same sweet taste irrespective of the input water source. The retail business further consolidated its No. 1 position in the fast growing modern, organised trade as well in the ever expanding regional retail chains.
The Packaged Drinking Water (PDW) business expanded further its franchisees and distribution reach to 31 live franchisees across 7 states that collectively dispensed 70 Million litre of Aqua Sure PDW water since launch.
During the year under review, Forbes Technosys Limited (FTL) received orders from a large number of PSU Banks & Private Banks who implemented their plans to set up Fully Electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL also received orders from neighboring countries like Nepal and Bhutan. Pursuant to the RBI mandate for implementation of Cheque Truncation Systems in Western Grid and extension of Southern Grid, FTL's Cheque Truncation Solution was the leading solution that got implemented in 70 plus banks across the entire western grid including leading PSU banks. FTL ventured into various new segments of Government, and supplied Kiosks to Judiciary, State Transport Corporations, and Department of Land Records, Collectorate, Defence and Research Centers, as an alternate delivery channel for a variety of e-Governance Services to consumers. FTL made an entry into the Enterprise Mobility Market and secured impressive orders from large corporates and banks.
Forbes Container Line Pte. Limited (FCL) made a record profit of SGD 1.6 million (approximately Rs 7 crore) during the financial year ended 31 March 2014. FCL improved its container fleet by leasing and improving the inventory to 7500 TEUs. FCL also participated in the India Vietnam trade. Forbesline Shipping Services LLC, a subsidiary of FCL, which has been set up in Dubai, started operations since June 2013.
During the period under review, SCI Forbes Limited (SCIF) was unable to service the debt and the lenders imposed a condition of accelerated loan recovery as a result of continuing default. The lenders filed a claim for recovery of the loan and costs in the Commercial Court in London. SCIF seeks to refinance the outstanding debt through another ECB facility. SCIF has been sanctioned a fresh ECB loan from Axis Bank Ltd. to the tune of USD 35 Million. SCIF has received an 'in-principle' approval from the Reserve Bank of India for repayment of existing ECB from the proceeds of the fresh ECB facility from Axis Bank Ltd.
During the year ended 31 March 2014, Forbes & Company continued to invest in its subsidiary companies. During the year under review Rs 3.95 crores was invested in Forbes Bumi Armada Offshore Limited and Rs 7.50 crores in Forbes Campbell Finance Limited. 1 Crore 1% Compulsory Convertible Optionally Redeemable Debentures of Rs 10 each held by the company in Forbes Technosys Limited have been converted on March 28, 2014 into 1 crore equity shares of Rs 10 each.
2014-15 was a year of consolidation and correction for Forbes & Company's Precision Tools Group (PTG) business vertical. The major focus was on the development of high performance product lines which suits different material applications. The design & development team developed products which are at par with international competitors. A new series of product lines was developed for the automobile segment to cater to the changing productivity demand of the industry. PTG established a capacity of 60 MT per month of Spring Washer facility catering to major auto Original Equipment Manufacturers (OEM) with zero defect assurance.
During the year under review, the PTG business vertical initiated diversification into the non-auto sector.
The initiatives taken by the company to strengthen its market position included modernizing the production facilities for better product quality, improvement in operational efficiencies and also in customer services. Operational excellence initiatives were undertaken under the 'Adapt, Change, Excel' (ACE) Program. There were continuous efforts to improve exports to the Middle East and the South East Asian markets and there were successful breakthroughs in Eastern Europe for taps.
With regard to Forbes & Company's Coding Business Group (CBG) business vertical, the highlights of automation solutions during the year were development of the first of its kind Optical Vision System Sorting Machine, Laser Marking systems, Automated assembly line for Water Filter cartridge assembly, Laser marking with 2D scanning & development of MES integrated system for a big automobile OEM. New initiatives included providing Traceability Software and Product development initiatives included handheld low cost marking device.
FY 2014-15 was dedicated to restructuring and streamlining the complete operations of Forbes & Company's Energy Solutions Group (ESG) business vertical. ESG was integrated into the existing Enterprise Resource Planning (ERP) quite successfully during FY 2014-15. The laid down processes and procedures also brought ESG successfully under the International Organization for Standardization (ISO) Coverage. The Certification Audit of ESG was conducted in the 1st Quarter of the financial year by SGS and was successful. There were a number of Drive Turbine enquiries wherein ESG was successful in bidding as well as executing.
In FY 2014-15, Eureka Forbes Limited (EFL) as one dominating force, expanded its markets, executed its strategies, evolved as individuals and excelled in performance, to make EFL group a Global Multi-National Corporation. The Aquasure Packaged Drinking Water (PDW) brand became available in over 24,000 outlets in 32 cities through 36 franchises, dispensing 41 million litres of water. The brand is now available across several prestigious clients. The Eurovigil Security Systems Brand secured prestigious multi-locational orders from several prestigious clients for Intrusion Alarm and Surveillance Systems (CCTV).
The water projects team made a foray into desalination plants by bagging and executing the first Diesel plant order from Toshiba, Japan for a power plant in Philippines.
During the year under review, Forbes Technosys (FTL) continued to establish leadership in e-lobbies, Cash Deposit kiosks, Passbook Printing Kiosks, Ticket Vending Machines, Information Kiosks and Coin Vending Machines. FTL received orders from a large number of PSU banks and Private Banks who implemented their plans to set up fully electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL also received large orders from Telecom Companies and Public Utilities for the deployment of Bill Payment Kiosk. FTL made significant investments in infrastructure creation, expansion of offices, service network, new product development and exports. FTL also recorded significant growth in its e-payments business and also launched an online portal for recharge, bill payments etc. to address the card users and Internet Banking segment. FTL made an entry into the Transportation sector by securing impressive orders from the Indian Railways for ATVMs (Automatic Ticket Vending Machines).
During the year, Forbes & Company incorporated a wholly owned subsidiary viz., Campbell Properties & Hospitality Services Limited. Forbes Campbell Finance Limited, a wholly owned subsidiary of the company, divested its entire shareholding (50% shareholding in the Joint Venture) in Nypro Forbes Products Limited.
During the year ended 31 March 2016, Forbes & Company's Precision Tools Group business vertical brand Totem strengthened its position as a leading brand in the domestic market and made good strides in the global space. High performance Taps led the way with success in China for application on super alloys and difficult-to-machine materials. Solid Carbide end mills found their niche in Eastern Europe and the progress continues. A series of product extensions and new business areas were tapped. Spring Lock Washers won a certification from the Power Grid Corporation of India, paving the way for entry in the power sector. The Precision Tools Group division continued with its 'Adapt, Change, Excel' (ACE) program - to be nimble and swift in business execution.
With regard to the company's Coding Business Group (CBG) business vertical, enhancement in the in-house facility, with addition of laser markers and testing equipment in the factory helped better service to Original Equipment Manufacturer (OEMs). The launch of Bradma lasers with variants of Fiber, Carbon Dioxide (CO2) had good acceptance in the Indian market. CBG also started catering to the valve and heavy engineering industry. Venturing into the Marking Software space, Bradma developed the interface for SAP integration with the user's marking assembly for one of the leading two-wheeler manufacturers in India.
In FY 2015-16, the Direct Sales Division of Eureka Forbes Limited (EFL) once again proved its mettle to stay ahead of the game with 'Category First' initiatives like; Paani-ka-Doctor clinics (Smaller offices to improve visibility and expand reach) and rental sales. Eurosmile, EFL's customer service division established a wide service network and exceeded 10 million customer visits during the year, catering to 15 million installation bases in India. The Aquasure Packaged Drinking Water (PDW) brand became available in over 24,000 outlets in 32 cities through 36 franchisees dispensing 41 million litres of water. The Eurovigil security systems brand secured prestigious multi-locational orders from clients like the MRF, ITC Wills Life Style and ITC Classmate for Intrusion Alarm and Surveillance Systems (CCTV).
Eureka Forbes Limited and Process Research Ortech, Canada, joined hands in bringing a unique technology of Automated Variable Filtration (AVF) technology to India for high quality water filtration thereby reducing costs in an environment friendly manner.
Forbes Facility made a successful entry into the Offshore Business' of housekeeping and catering with Forbes Bumi Armada Offshore Limited.
FY 2015-16 was a year of consolidation for Forbes Technosys Limited (FTL) across its business verticals and product range in a challenging business environment particularly for the ATM, Cash Deposit and Recycler, Sorter and Coin Vending business segment as Banks had put procurement plans on a hold due to the withdrawal of subsidies by the Reserve Bank of India, in June 2015. During the year under review, FTL continued to establish leadership in e-lobbies, Passbook Printing Kiosks and Automatic Ticket Vending Machines. FTL received and executed a large order for Passbook Printing Kiosks from the State Bank of India, the largest single deployment of Passbook Printing Kiosks in a single year in India so far. FTL also got major orders from the Corporation Bank and, the Union Bank of India who, using hardware manufactured by FTL, set up fully electronic Self Service Branches called e-lobbies to enhance their services to customers. FTL had an impressive foray into the Transportation segment and received significant orders from the Indian Railways across the country for over 1000 ATVMs (Automatic Ticket Vending Machines) including Cash based ATVMs.FY 2015-16 saw the successful launch of the Domestic Money Transfer business of Forbes Xpress which operates through a network of franchisees that also provide other services like recharging, bill payments and ticketing.
Forbes Bumi Armada Limited (FBAL) commenced provision of manning services after receiving Recruitment and Placement Services License from the Director General of Shipping.
During FY 2015-16, Lux Aqua GMBH, Switzerland and Lux Aqua (HU) Hungary were incorporated as wholly owned subsidiaries of Lux International AG and Lux Aqua GMBH respectively.
During the year ended 31 March 2017, Forbes & Company's Precision Tools Group (PTG) business vertical continued efforts to introduce new products to the market in Carbide Raw Material, Expansion of High Performance Taps product portfolio, introduction of Solid Carbide Long Series Drills and expansion of HSS drill range. New dealers introduction, a strong initiative taken in FY 2016-17, has been made across the country and continues to be an ongoing process to expand reach and growth in the business. Introduction of New Technologies in the field of Heat Treatment, Geometric measurements and Edge preparation in manufacturing has led to product quality enhancement to compete against best in class. Substantial investments were made in Waluj Facility during the year.
With regard to the company's Coding Business Group (CBG) business vertical, FY 2016-17 was the year of consolidation for automation business. CBG introduced integrated marking solutions with software, coding & decoding, scanning/Vision systems. During this year, CBG was able to provide automation system as an import substitute to one of the leading two-wheeler manufacturer and achieved success by exporting a fully integrated system to Egypt, which was also a first for the company. CBG started assembly of laser optics in Waluj Factory with its own system controls. Industry 4.0 solution was implemented for automotive industry which is going to be one of the future revenue stream. The CBG division continued with its 'Adapt, Change, Excel' (ACE) program- to be nimble and swift in business execution from product selling company to solution provider.
In the electric water purifier space, Eureka Forbes Limited (EFL) regained a 12% market share in the financial year 2015-16 taking EFL market share to 67% and retained the same in the financial year 2016-17. The year also witnessed the business composition change where the Retail Channel (Consumer Division) and Partner Channels (Franchise Direct Operators & Franchise Business Partners in Direct Sales) grew while the one time core business of Customer Response Centre (CRC business of Direct Sales) de-grew marginally vis-a-vis last year, this was mainly due to unbudgeted increase in wage bill. During the year under review, EFL launched the first 'Made in India for the world' Air Purifier Aeroguard 4S.
The focus on digitisation resulted in fruits with over 350,000 validated leads and Rs1000 million turnover from digital platform resulted in a quantum growth over previous year. Unlike the e-com wave of discounts EFL held the price and strategic partnership with 'Google' helped EFL dominate in the space with over 70% Share of Voice in the categories EFL has been present in. Additionally mobility both in Sales & Service began to show early benefits. On the international front, opening of business to business segment, new channels i.e. Retail, e-tail and party plans together with opening of 10 new markets, re-organisation of operations, cost-optimisation drive, elimination of non value adding services, focus on core business and a new category of mattresses had been the thrust during year gone by.
FY 2016-17 was a year of consolidation for Forbes Technosys Limited (FTL) across its business verticals and product range in a challenging business environment. The second half of FY 2016-17 was impacted by the Demonetization drive of the Government. FTL's major customer being banks, this impacted the sale of all banking equipment and given the predominance of banking in FTL's business portfolio, this caused a sharp impact on sales during the second half of the year as FTL's key customers were focused on addressing the public needs arising out of Demoetization.
Sales of Forbes Xpress offerings were also adversely affected due to non/limited availability of cash during the months from November 2016 to March 2017. The entry of a major telecom player, who offered free services from October 2016 to March 2017, impacted other Telecom players whose prepaid pack business was impacted and therefore FTL's business was impacted with them. Therefore, FTL had to shift focus on generating margins from services, as other revenue streams were impacted. Services showed over 100% increase in revenues over the previous year and helped improve profitability. During the year under review, FTL had an impressive foray into the insurance sector, with the introduction of self-service solutions for the same.
In sync with the long term strategy of Forbes & Company's to exit those businesses which were not a strategic fit with the long term vision of company and in a manner that optimizes value, the company has during the FY 2016-17, exited its Container Freight Stations and Logistics businesses and received a consideration of Rs. 963 millions. The company also sold its entire shareholding (50.001%) in Forbes Bumi Armada Offshore Limited, a joint venture with Bumi Armada Berhad to Shapoorji Pallonji Oil and Gas Private Limited at a consideration of Rs. 125 millions.
During FY 2016-17, Lux Professional GmbH, Lux Osterreich Professional GmbH, Lux Aqua Paraguay SA, Lux Aqua Czech s.r.o, Lux Waterline GmbH and Brightclean (Spain) S.L were incorporated/have become wholly owned subsidiaries of Lux Professional International GmbH.
The year 2017-18 was an eventful year for Forbes & Company with many events playing its part and impacting the organisation substantially. Across businesses the company has renewed leadership at some levels, built a highly supportive customers, and motivated team with a solid action plan to improve financial returns.
During the year under review, the company's Precision Tools Group (PTG) business vertical introduced long drills in carbide for automotive application which has 100% growth with specific success in applications of Crankshaft oil hole drilling, drilling of Automotive special parts & Mining drills. PTG's other initiatives during the year included investment & capacity enhancement in manufacturing HSS drills at Waluj, Aurangabad for improved product margins & availability. Spring washer facility in Waluj, Aurangabad got approved by one of the major international fastener giants.
The company's Industrial Automation business under its Coding Business Group (CBG) business vertical has proved its mettle in line automation projects done for a leading four wheeler manufacturer in India. Clutch Assembly & Gear Box Assembly lines were successfully installed & commissioned. Large-value CBG automation orders from big automotive OEM companies are one of significant achievements in FY 2018 for the projects business. During the year, some product lines were moved from Chikalthana to Waluj.
During the year under review, the company invested Rs 10 crore in Preference Shares of Forbes Technosys Limited, a wholly owned subsidiary of the company.
During the year under review, Eureka Forbes Limited (EFL) continued to drive innovation across brands, categories, operations and adapted the go-to-market strategies, taking into account the diversity, market needs, and the evolving channels of distribution. EFL continued to lead the digital transformation within and leveraged its Direct Sales capabilities to drive competitive advantage. EFL grew in the fast emerging e-commerce channel supported by Eurochamps and its Retail and Institutional efforts to assist the customers across the length and breadth of India continued. Most importantly, EFLs brands and operations continued to be held together by its firm belief/purpose to be Friend for Life'.
During the year under review, Forbes Technosys Limited (FTL) continued its growth across multiple sectors and dimensions, albeit with pressures on revenue growth. GST though beneficial in long term, in the year under review, posed several issues related to re-classification of goods and services as well as reconfiguration of GST by the company's customers impacted the velocity and scale of business. In these circumstances, FTL chose to consolidate across its business verticals and product range in a challenging business environment and increase in service and solution revenue. Forbes Xpress, FTL's e-payments services platform, continued to grow both in terms of scale, franchisee numbers and geographic presence. During the year, development effort for launching the Bharat Bill Payment System (BBPS) was undertaken and was launched on schedule.
In January 2018, Shapoorji Pallonji Forbes Shipping Limited (SPFSL, formerly SCI Forbes Limited) acquired one 2006 Japanese built vessel with stainless steel tanks of 20,938 mt dwt (MT Saranga) increasing the total dwt capacity of the company to 73,424 mt. SPFSL is the only company in India that owns chemical tankers.
Forbes & Company Ltd
Directors Reports
#MDStart#
REPORT OF MANAGEMENT DISCUSSION AND ANALYSIS
Dear Members,
The Board of Directors hereby submit the report of the business and operations of the
Company along with the Audited Financial Statements of the Company for the Financial Year
(FY) ended March 31, 2023. The consolidated performance of the Company and its
subsidiaries has been referred to wherever required.
Financial Results and Highlights of Performance
The Company's performance, as per Indian Accounting Standards (IND AS), during the
Financial Year under review is summarized as follows:
Rs in Lakhs
Particulars |
Standalone |
Consolidated |
|
FY 22-23 * |
FY 21-22 |
FY 22-23 * |
FY 21-22 * |
Revenue and Other Income (Total Income) |
46,174 |
24,875 |
71,011 |
54,917 |
Earnings before Finance Cost, Depreciation, Share of Net Profit of
Joint ventures Exceptional Item & Tax |
23,997 |
4,687 |
24,894 |
8,388 |
Share of Net Profit of joint venture |
- |
- |
296 |
1,204 |
Profit / (Loss) after Finance Cost, Depreciation, Share of Net profit
of Joint ventures and before Exceptional Items & Tax |
21,817 |
2,144 |
20,710 |
1,250 |
Exceptional Items - Income/(Expense) |
2,905 |
4,10,091 |
1,202 |
(34,641) |
Profit before Tax (PBT) |
24,722 |
4,12,235 |
21,912 |
(33,391) |
Profit/(loss) after tax for the year from continuing operations |
23,859 |
4,13,294 |
19,133 |
(32,361) |
Profit/(loss) before tax from discontinued operations |
- |
- |
69 |
4,57,306 |
Tax Expense |
863 |
(1059) |
(20) |
(2,080) |
Profit/(loss) for the year from discontinued operations |
- |
- |
49 |
4,55,226 |
Profit/(Loss) for the year |
23,859 |
4,13,294 |
19,182 |
4,22,865 |
Other Comprehensive Income (net of tax)/(Loss) |
1,308 |
22 |
(3,222) |
6,499 |
Total Comprehensive Income |
25,167 |
4,13,316 |
15,960 |
4,29,364 |
Earnings Per Share - Basic and Diluted (?) (Continuing operation) |
184.95 |
3203.83 |
150.38 |
(253.34) |
Earnings Per Share - Basic and Diluted (?) (Discontinued operations) |
- |
- |
0.39 |
3,575.39 |
Note: The above figures are extracted from Standalone and Consolidated Financial
Statements as per Indian Accounting Standard (IND AS") and are prepared in
accordance with the principles stated therein as prescribed by the Ministry of Corporate
Affairs under section 133 of the Companies Act, 2013 ("Act") read with relevant
rules issued therein.
* The results are not comparable because of the effect of a) sale of 3.804 acres of
land at Chandivali at a profit of Rs 206.84 Crores and has been recognized as Other income
in the financial results. b) Sale of entire equity shareholding in Forbes Facility
Services Private Limited (FFSPL), at a gain of Rs 32.00 crores is recognised as an
exceptional gain. c) the Composite Scheme of Arrangement between Aquaignis Technologies
Private Limited, Euro Forbes Financial Services Limited, Eureka Forbes Limited, Forbes
& Company Limited and their respective Shareholders and simultaneous demerger of
Health, Hygiene, Safety Products and Services Undertaking with effect from February 1,
2022. The Health, Hygiene, Safety Products and Services Undertaking is considered as
discontinued business for the period April 1, 2021 to January 31, 2022 for the purpose of
this reporting in line with Ind AS requirements.
Management Discussion & Analysis of Financial Conditions,
Results of Operations and State of Company Affairs
General Performance and Outlook
The financial year in discussion had its own share of surprises. The Indian economy has
moved on after its encounter with the pandemic and FY 2022-2023 was a year of several
challenges to growth, which India faced and withstood them better than most economies.
Measures taken by the government and RBI have managed to rein in inflation while
continuing to support economic growth. As inflation rates accelerated, many countries
faced severe economic stress. During this difficult period and uncertainty, India became
the world's fifth largest economy, measured in current dollars in the year 2022. According
to the Economic Survey 2023 presented by the government, in real terms the GDP growth for
2023 -24 has been predicted to be 6.5 % and growth in range of 6 % and 6.8%, depending on
the direction of global economic and political development. While the efforts of India
overall were stupendous in the global environment, the challenges itself continue to
prevail and the policy making bodies and the industry itself has to remain alert to these
challenges. Overall, the outlook for the Indian economy remains positive.
Performance and outlook
During the year under consideration, your Company has seen many actions of
consolidation and these are discussed hereunder followed by the discussion on results.
This allows your Company to focus on the core and growth oriented businesses, namely
Precision Tools, Industrial Automation and Real Estate. The Company has a tradition of
excellence and total customer delight as its singular aim. During the year, major actions
have been taken in various areas and the key points are being summarized hereunder for the
better understanding of all its stakeholders.
Your Company has transferred, by sale, its entire equity shareholding in Forbes
Facility Services Private Limited (FFSPL), a wholly owned subsidiary of the Company, to
SILA Solutions Private Limited (SILA) and pursuant to Share Purchase Agreement dated May
20, 2022 (SPA). The Company has received the closing date sale consideration of Rs 39.60
crores and post-closing sale consideration of Rs 2.40 crores are subject to realization of
receivables under litigation by FFSPL as per the terms of the SPA. The net consideration
after carrying amount of investment and expenses incurred on the sale transaction an
amount of Rs 32.00 crores is recognised as an exceptional gain.
Your Company has entered into a Sale Deed dated June 3, 2022 with Equinix India
Private Limited for sale of 3.804 acres of land at Chandivali at a total consideration of
Rs 235 crores. The Company has received entire consideration of Rs 235 crores. The
difference between the net disposal proceeds and the carrying amount of the land amounting
to Rs 206.84 crores has been recognized as gain on disposal and reflected in other income
in the financial results.
Shapoorji Pallonji Forbes Shipping Limited (SPFSL), a subsidiary of your
Company, sold its last owned vessel on April 4, 2022 consequently there were no business
operations left in the SPFSL. As such, your Company sold its entire equity and preference
shareholding in SPFSL to M/s G.S Enterprises, a related party, vide Share Purchase
Agreement dated June 22, 2022, for an aggregate purchase consideration of Rs 29 crores
basis valuation report by an independent valuer. The net carrying value of the investments
in associate as at the date of sale was Rs 28.02 crores and hence the Company has
recognised an exceptional gain of Rs 0.98 crores in the financial results.
Your Company and MACSA ID, S.A., have entered into a 50:50 Joint Venture
Agreement on December 5, 2022 (JVA) for providing innovative laser marking and
traceability solutions for the entire range of materials metal and non-metals. Pursuant to
the terms of the JVA, a joint venture company viz., Forbes Macsa Private Limited (JVC) has
been incorporated on December 9, 2022. The JV partners have infused equity and preference
shares capital to the tune Rs 2.5 Crores each in the JVC and the full amount was converted
into Equity and Preference Shares at the beginning of the year 2023-24. The JVC and
shareholders have executed the technology and trademark license agreement and brand and
technology licensing agreement with respect to their respective brands. The operations of
JVC started from March 1, 2023.
Your Company has approved the Scheme of Arrangement ("Scheme") between
the Company ("FCL" or the "Demerged Company") and Forbes Precision
Tools and Machine Parts Limited ("FPTL" or the "Resulting Company")
and their respective shareholders under Section 230 to 232 of the Companies Act, 2013 and
other applicable provisions and the Rules framed thereunder. This Scheme is a Scheme of
Arrangement involving demerger of Precision Tools business of the Company into Forbes
Precision Tools and Machine Parts Limited. The Scheme is subject to necessary approvals by
the Stock Exchanges, Securities and Exchange Board of India, Shareholders and Creditors of
the Company, as may be applicable, Jurisdictional Bench of National Company Law Tribunal
("NCLT") and such other statutory and regulatory approvals as may be required.
The relevant documents for obtaining approval under Regulation 37 of the SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015 [SEBI LODR] are submitted to
the BSE Ltd.
FPTL has been incorporated on August 30, 2022 as a wholly owned subsidiary of the
Company for carryout the Precision Tools business after implementation of the Scheme.
Subsequently to all relevant approvals, it will be listed on BSE Limited.
Your Company has paid Special interim dividend of Rs 65 per fully paid equity
share of Rs 10 each for the financial year 2022-23. With a view to preserve resources,
this shall be the final dividend too and there shall be no further distribution of
dividend for the current financial year.
The operations of Forbes Technosys Limited (FTL), a 100% subsidiary, has been
substantially rationalised and all the external loans from Banks have been fully repaid
which are funded by your Company by way of investment in FTL either as equity or as Inter
Company Deposits (ICDs). The earlier loans of FTL were guaranteed by your Company and FTL,
given its liquidity position, FTL was unable to meet its obligations and were hence
supported by your Company.
The National Company Law Tribunal (NCLT) have approved Composite Scheme of Arrangement
for merger of Forbes Campbell Services Limited ("FCSL") into FTL and reduction
in the share capital of FTL on September 24, 2022. The appointed date of the Scheme was
October 1, 2021 and the Scheme has been effective from September 29, 2022.
Consequent to the above rationalisation and relevant developments/actions, your Company
now can better focus to handle and address the key areas - namely Engineering business
(Precision Tools), Industrial Automation and Real Estate business. The above actions
enable your Company to take challenging targets to leverage on the competencies and the
capabilities created with the new situation.
Engineering Division
The engineering business including Precision Tool Group and the Industrial Automation
group delivered 12% YoY growth. The focus this year was on investing in the future in new
product lines and capacities to enable future growth.
Our focus on excellence and Customer Delight helped the Totem Cutting Tools Brand bag
the best Metal Cutting Tool Brand Award by Times Group for 3rd consecutive year.
Improvement across supply chain, including customer deliveries helped us to grow
channel sales by 22% YoY by strengthening supply chain initiatives. Engineering business
strengthened its capabilities in product development building capacities & improving
efficiencies of operation. The key challenges were seen in export market, where we saw a
limited growth in markets like European Union and Israel, degrowth in Russia lower and
slower offtake from the North Americas.
Our efforts to making workplace safe & green too started paying off and the
Engineering Business has been awarded with Safety Award by CII for Good Safety Practices.
Precision Tools Group (PTG)
PTG business grew by 16% YoY even after geopolitical crisis of Russia and Ukraine which
impacted our Company's business to Russia and a less than anticipated demand from USA. On
the other hand, some of our product portfolio (e.g. Taps, Dies, Rotary Burs), inspite of
the international challenges have grown 20%. We see this situation continuing into the new
financial year, but we also see the opportunity of developing our own unique product
portfolio, which will provide us with the growth we aspire.
Challenges in the supply chain with shortages of raw materials & increased prices
and input cost puts pressure on profitability of business. The overall impact was around
2-3% on the margins. We have expanded capacities in Hand Tools, HSS Drills, Tungsten
carbide Rotary Burrs, Spring washers portfolio & Introduced Vacuum Heat treatment
technology for High-Speed steel, Drag Finish Edge Preparation technology for application
in specific Carbide Drills. We have also invested in establishing and upgrading
Metallurgical Laboratory to enable new product development at a greater speed.
Our efforts in building brand and promoting products through domestic &
international exhibitions helped us to attract new customers and opened gates for new
geographies. Engineering Business participated in Regional & International exhibitions
Viz. IMTEX Bangalore, IMTS USA, Mach Auto, Hand Tools Expo. Economic Times group
recognition for Best Metal cutting Brand, 3rd year in row helped us to improve our image
from standard tools company to High performance tools company.
PTG portfolio had remarkable success in making inroads to Key account & Development
of Key Channel Partners for future growth requirement. Our cutting tools portfolio is now
well accepted with multiple customers in Aerospace, Defense & Die & Mould, valve
Industries and auto component manufacturing sectors.
International market growth is another element of business growth strategy & Forbes
continued its business development in focused geographies which include Europe, Gulf
Cooperation Council (GCC), Southeast Asia, America & Far East. We have acquired three
big accounts which will contributes 50% of revenue of international sales in the near
future. We are strengthening our presence in International geographies to specifically
achieve higher penetration in South East Asia and GCC countries.
The Company continued to invest in selective new processes and technologies to make
product better and efficient in line with Company's vision of empowering customer through
innovative products. PTG will continue to invest in capacity augmentation to meet
increased market demand. Given the objectives, the Company has also undertaken some
initiatives to improve the supply chain efficiency and embarked on some projects which
will yield long term supply chain efficiencies.
Industrial Automation and Coding Business Group (CBG)
CBG business is still under transformation and growth stage moving from purely marking
business to Special Purpose Machine, Automated Traceability Solution & Industry 4.0
Solutions. After carving out Laser technology as separate JV company, the Industrial
Business is building scales in Dot Peen technology and Conventional marking elements.
Though presently small, these two product lines have grown YoY & are profitable and
are growing. The Company is now focusing on growth in the areas of building Special
Purpose Machines & engaging in Automation project to expand the business and achieve
scale and volume to be able to operate more efficiently. Focus is also on building up
sales capacities for this line of business. Geographic coverage by appointment of
distributors will help product growth.
One more exciting opportunity being explored is to expand the market of medical
products which the Company is pursuing and will aggressively take it up after it achieves
the US FDA certification of its first product which is presently under certification. We
are fairly confident of obtaining the certification in due course, post which we will put
in marketing efforts to distribute the said products.
"If a thing's worth doing, it's worth doing well." To ensure that things are
done well, Quality is the only way ahead and for that one has to have focus on high class
processes and its sustainability. The focus of your Company in this area is commendable
and is demonstrated from the fact that the following initiatives were successfully
undertaken during the year:
a. IATF 16949 - Certification for Auto Sector;
b. ISO 9001-2015 for PTG & Industrial Automation and medical devices;
c. AS 9100 - Certification for Aerospace sector in Solid Carbide tools.
d. CDSCO approvals for mechanical & ICU ventilators
e. ISO 13485 /2016 - Certification for medical devices
Project Vicinia, Chandivali
The Company has completed the construction of Phase 1 of the project containing Towers
A, B, C, D, & F which has been made available for hand over to the customers. Phase 2
containing Towers E, G & H are expected to be completed in near next few quarters. The
Company has sold entire flat inventory except 8 flats in the total project.
Overall completion of the project is delayed consequently, there have been some
financial impact on the project cost which were beyond the control of the operational
team. Seven dissatisfied customers have filed complaints with the MahaRera and these are
being handled in conformance with the provisions of the law. The management is of the
opinion that there will be no material impact due to these demands, most of them
exaggerated beyond the interpretation of the contracts and are hopeful that these parties
will seek an amicable resolution soon to mutual satisfaction of both parties.
Lux Group (including post balance sheet date events):
The year 2022 under review was the second full year after the outbreak of the pandemic.
While the situation following COVID19 normalized in more or less all of Lux Group national
sales organizations, the outbreak of the war in Ukraine heavily affected the European
markets. Further threats were the FX - rate fluctuations, inflation rates, interest rates
for commercial financing and changing costs of raw materials & transportation. For
2022, While the global aggregated Net Sales in EUR decreased by -6% (excluding Latin
America: only -4%) compared to previous year, the number of main units delivered to Third
Parties shrunk by -15%. Lux Group for FY 2022 reported a consolidated net loss amounting
to 5.74 mn EUR. The overall situation of Lux Group is quite challenging. Various actions
were pursued by the subsidiaries Board, which mainly included adapting the model of moving
to a distributor model, in lieu of operating each of these companies as a subsidiary. The
local management expected the business to be more asset light for the companies giving it
a better chance of improvement.
On April 11, 2023, Forbes Lux International AG, Lux International AG, and Lux Schweiz
AG, all subsidiaries of your Company, submitted a combined request for provisional debt
restructuring moratorium with the Insolvency court in summary proceedings at Wallissellen,
Switzerland. The said court has granted a provisional moratorium for 4 months and also
appointed a Provisional Administrator, as per the rules defined for this purpose. The
moratorium cannot exceed a period of 4 months and may be extended by another 4 months in
exceptional situations, by which time, the companies have to provide a revival plan within
this defined period. We will provide all the stakeholders the updated information on a
periodic basis. It is however important to state that the investment in Lux group is all
provided for and hence there is no impact on the standalone financials of your company as
on date.
Forbes Technosys Limited (FTL)
The year under review has been quite a challenging year for FTL. The company had a
limited pipeline of orders entering FY 202223 as the company exited the loss making/ low
margin businesses. FTL continued with its endeavor to right size the organization and
rationalize costs.
FTL has shown losses of Rs 33.85 crores, which include provision for old debts and
inventories Rs 14.1 crores, Intangible write off Rs 5.0 crores, Interest Rs 3.8 crores and
Depreciation of Rs 4.2 crores during the year under review, including cash and non-cash
losses. Cash losses were primarily because of the company's inability to procure orders or
lower service revenue business.
Forbes Bumi Armada Limited (FBAL)
The gross revenue from operations for the financial year ended March 31, 2023 stood at
Rs 57. 8 crores compared to Rs 55.6 crores for the financial year ended March 31, 2022.
Total Comprehensive income is at Rs 3.05 crores as against Rs 2.07 crores in the previous
year.
FBAL maintains qualified and experienced manpower which continues to provide quality
manning services for Operation and Maintenance of Floating Production Storage Offload
"FPSO" Vessels. It provides the best manning services in the field of FPSO
Units. The provided manpower companies have achieved award of International Safety Award
for demonstrating a strong commitment to good health and safety management during FY
2022-2023 by British Safety Council. FBAL has completed the year 2022-23 with zero
complaint of client. FBAL continues providing Operations and Management manning services
to two (2) FPSO and new venture came in the year 2022-23 to render the services of Armada
Sterling V. Manpower resources of FBAL are delivering international standard services
while maintaining top level Health Safety and Environment track records.
FBAL has duly complied with ISO 9001, 14001 & 45001 and OSHA 18001 to ISO 45001
certifications, which are valid till January 17, 2024 and ISO 27001 (Cyber Security) is
valid till July 27, 2023. All the compliances in terms of renewal of certification,
licenses and other imperative regulations are regularly renewed and fully complied by the
company without any delay. During the year under review, there has been no change in the
nature of business and share capital of the Company.
Forbes Macsa Private Limited
The Company and MACSA ID, S.A., have entered into a 50:50 Joint Venture Agreement on
December 5, 2022 (JVA) for providing innovative laser marking and traceability solutions
for the entire range of materials metal and non-metals. Pursuant to the terms of the JVA,
a joint venture company viz., Forbes Macsa Private Limited has been incorporated on
December 9, 2022. The business has incurred a small loss at Total Comprehensive Income
level of Rs 13.5 lakhs.
Assets of The Svadeshi Mills Company Limited (Svadeshi)
The Assets of Svadeshi continue to be in the hands of the Official Liquidator, High
Court, Bombay as on March 31,2023. An application pursuant to the provisions of section
466 of the Companies Act, 1956 has been filed by Grand View Estates Private Limited before
the Hon'ble Bombay High Court to stay the winding up proceedings and bring Svadeshi out of
liquidation.
Financial Performance
The Consolidated Financial Statements of the Company and its subsidiaries, its joint
ventures and associate companies are prepared in accordance with Indian Accounting
Standards (Ind AS) notified under Section 133 of the Act read with Companies (Indian
Accounting Standards) Rules, 2015 as amended from time to time and other relevant
provisions of the Act. The Notes to Consolidated Financial Statements are disclosed and
forms part of the Consolidated Financial Statements.
Segment wise performance
The summarized performance of segment revenues and segment results is as under:
Rs in Lakhs
Particulars |
Segment Revenue |
|
FY 22-23 |
FY 21-22 |
Health, Hygiene, Safety Products and its services |
18,986 |
22,404 |
Engineering |
22,987 |
20,631 |
Real Estate |
1,943 |
2,972 |
IT Enabled Services and Products |
312 |
1,066 |
Shipping and Logistics Services |
0 |
4,443 |
Others |
8 |
29 |
Total |
44,236 |
51,545 |
Less: Inter Segment Revenue |
(38) |
(72) |
Total Income from operations (net) |
44,198 |
51,473 |
Particulars |
Segment Results |
|
FY 22-23 |
FY 21-22 |
Health, Hygiene, Safety Products and its services |
4,486 |
(31,941) |
Engineering |
2,477 |
2,969 |
Real Estate |
124 |
753 |
IT Enabled Services and Products |
(3,011) |
(2,179) |
Shipping and Logistics Services |
0 |
926 |
Others |
0 |
(15) |
Total segment results |
4,076 |
(29,487) |
Add: Share of profit of joint ventures and associates accounted for
using equity method |
296 |
1,204 |
Add: Exceptional items |
(816) |
(230) |
Less: Finance Costs |
(1760) |
(4,198) |
Balance |
1796 |
(32,711) |
Add: Unallocable income/(expenses) |
20,116 |
(680) |
Profit /(Loss) from continuing activities before tax |
21,912 |
(33,391) |
Profit from discontinued operations |
69 |
4,57,306 |
Profit /(Loss) before tax from continuing and discontinued operation |
21,981 |
4,23,915 |
Key Financial performance, Operational Information and Ratio Analysis
Key Ratios/ Indicators |
Standalone |
Explanation for change of 25% or more |
|
FY 22-23 |
FY 21-22 |
|
Debtors Turnover (in days) |
43 |
49 |
This is an improvement mainly on account of increased in sales of
Engineering division during year and better receivable management |
Interest Coverage Ratio |
28 |
3 |
The available liquidity permitted us to repay all major outstanding
and combined with profitability, the coverage ratio shows substantial improvement. |
Operating Profit Margin % |
91% |
14% |
Improvement is mainly on account of increased income in Current Year
on account of sale of Chandivali land which is non-recurring. |
Return on Net Worth |
101% |
82% |
Improved mainly on account of increased income in Current Year on
account of sale of Chandivali land, which is non-recurring |
Key Ratios / Indicators |
Consolidated |
Explanation for change of 25% or more |
|
FY 22-23 |
FY 21-22 |
|
Debtors Turnover (in days) |
68 |
81 |
This is an improvement mainly on account of increased in sales of
Engineering division during year and better receivable management |
Operating Profit Margin % |
50% |
8% |
Improvement is mainly on account of increased income in Current Year
on account of sale of Chandivali land which is non-recurring. |
Net Profit Margin % |
43% |
822% |
Both years include exceptional items of a high magnitude. Exceptional
items mainly includes the adjustment entries passed for Composite Scheme of Arrangement in
previous year and include exceptional gains in the current year. |
Return on Net Worth |
89% |
15% |
Improved mainly on account of increased income in Current Year on
account of sale of Chandivali land, which is non-recurring |
Revenue
During the year Company has achieved total standalone revenue (Including other income)
of Rs 46,174 lakhs (previous year Rs 24,875 lakhs), The increased is mainly on account of
sale of 3.804 acres of land at Chandivali at a profit of Rs 20,684 lakhs and has been
recognized as Other income in the financial statements.
During the year Company achieved consolidated revenue (including other income) of Rs
71,011 lakhs (previous year Rs 54,917 lakhs), Earnings Before Interest, Depreciation,
Taxation and Amortization ("EBIDTA") (excluding Exceptional item) Standalone
EBIDTA is Rs 23,997 lakhs (previous year Rs 4,687 lakhs) while Consolidated EBIDTA is Rs
24,894 lakhs (previousyear Rs 8,388 lakhs), both significant increased mainly on account
of sale of 3.804 acres of land at Chandivali at a profit of Rs 20,684 lakhs and some items
amounting to Rs 2905 lakhs has been recognized as income in financial statement and due to
lower losses in subsidiaries.
Profit/(Loss) Before Tax ("PBT")
Consequent to the above, during the year standalone PBT is Rs 24,722 lakhs
(previousyear Rs 4,12,235 Lakhs) Consolidated profit of Rs 21,912 lakhs (previous year
loss Rs 33,391) lakhs is mainly on account of sale of 3.804 acres of land at Chandivali at
a profit of Rs 20,684 lakhs and has been recognized as other income in financial statement
as against impairment of goodwill and investment of Rs 337.67 crores in previous FY 2021
-22.
Fixed Assets
During the year standalone Gross Block is Rs 14,422 lakhs (previous year Rs 14,241
lakhs) on account of investment in plant & machinery for Engineering
business.Consolidated Gross Block is Rs 17,190 lakhs (previous year Rs 16,731 lakhs), the
increase is mainly on account of investment in Plant & Machinery.
Total Comprehensive Income / (Loss)
During the year standalone profit after other Comprehensive income of Rs 25,167 lakhs
(previous year Rs 4,13,316 ) out of which Rs 20,684 lakhs profit on sale of Chandivali
land & Rs 2,905 lakhs are on account of exceptional items mainly includes Profit on
sale of Investment in FFSPL.
Consolidated Profit after Other Comprehensive Income of Rs 15,960 lakhs (previous year
Rs 429,364 lakhs)
Borrowing
Total standalone borrowing is Rs 1,256 lakhs, (previous year Rs 10,169 Lakhs) reduced
by Rs 8,913 lakhs on account of repayment of shortterm borrowings and term loans.
The Company's consolidated borrowing is Rs 5,128 lakhs (previous year Rs 27,132 lakhs),
has gone down on account of repayment of short-term borrowing & term loans.
OPPORTUNITIES & RISKS
Our success as an organization depends on our ability to identify opportunities and
leverage them while mitigating the risks that arise while conducting our business. Major
risks identified by the businesses and functions are systematically addressed through
mitigating actions on a continuing basis. Some of the opportunities and key risks,
anticipated impact on the Company and mitigation strategy is as follows:
Market Development
Your Company monitors external market trends and collates consumer insights to develop
category and brand strategies.
The Company actively searches for ways to translate the trends in consumer preference
and taste into new technologies for incorporation into future products. We develop product
ideas both in-house and with selected partners to enable us to respond to rapidly changing
consumer trends with speed.
The Company is dedicated to ensuring that its vendors, suppliers, contractors etc work
in a healthy and safe environment while delivering on the expected standard.
Given our dependency on Automotive sector, one more aspect of risk is the way the
development of this industry will evolve due to the Electric initiatives of the sector.
The trends of this industry moving to different fuel options will impact the demand of the
consumer and we will have to align ourselves and remain abreast of the happenings to be
able to have an important share in contributing to this aspect.
Political and Global Uncertainty
Political uncertainty or volatile economic uncertainty may adversely affect the reduced
demand and could restrict revenue growth opportunities.
The Company has broad based diversified businesses catering to various industry
segments and diverse markets and hence may not get affected by such uncertainty.
Legal and Regulatory
Compliance with laws and regulations is an essential part of your Company's business
operations. We are subject to laws and regulations in diverse areas as product safety,
product claims, trademarks, copyright, patents, competition, employee health and safety,
the environment, Water and Air Pollution, corporate governance, listing and disclosure,
employment, and taxes. Frequent changes in legal and regulatory regime and introduction of
newer regulations with multiple authorities regulating same areas lead to complexity in
compliance. We closely monitor and review our practices to ensure that we remain complaint
with relevant laws and legal obligations.
Systems and Information
Your Company's operations are increasingly dependent on IT systems and the management
of information.
Increasing digital interactions with customers, suppliers and consumers place even
greater emphasis on the need for secure and reliable IT systems and infrastructure, and
careful management of the information that is in our possession.
The cyber-attack threat of unauthorized access and misuse of sensitive information or
disruption to operations continues to increase.
To reduce the impact of external cyber-attacks impacting our business, we have
sufficient security measures including firewalls and threat monitoring systems in place,
complete with immediate response capabilities to mitigate identified threats. Our
employees are trained to understand these requirements.
Energy Management
The Company's factories consume power for the manufacturing and for the purpose of air
cooling. The Company identifies it as a critical resource and gives it due attention to
optimize its use including using green source like solar power etc. The Company has
initiated over the year installation of solar system within its factory. Though this has
met only partial demand, attempts have been made to look at the opportunity and enlarge
the scope of such coverage.
Internal control systems and their adequacy
The Company has an internal control system, which ensures that all transactions are
recorded satisfactorily and reported and that all assets are protected against loss from
unauthorized use or otherwise. The internal control systems are supplemented by an
internal audit system carried out by a team under the direct supervision of the Head of
Internal Audit. The findings of such internal audits are periodically reviewed by the
management and suitable actions taken to address the gaps, if any. The Audit Committee of
the Board meets at regular intervals and addresses significant issues raised by both the
Internal Auditors and the Statutory Auditors. The process of internal control and systems,
statutory compliance, information technology, risk analysis and risk management are
inter-woven to provide a meaningful support to the management of the business.
M/s Sharp & Tannan Associates, the statutory auditors of the Company has audited
the financial statements included in this annual report and has issued a report on our
internal financial controls over financial reporting as defined in Section 143 of the Act.
Material Development in Human Resources and Industrial Relations
The fiscal year 2022-23 started with promising business results across all the Product
Categories. The focus of Human Resources Function was in the areas of Safety, Health &
wellbeing of the employees, Talent Acquisition, Performance Management, Capability
Development for making future ready organization. New joinees have undergone the
induction program for their integration with the culture, values systems of the Company.
Performance Management System workshop was conducted for aligning functional Key Result
Areas and Performance Indicators in line with annual business plan. People Capability
Development programs were organized to strengthen employee competence and improve
productivity. The Leadership Development Program for the some Leaders & Managers was
conducted to strengthen competence in Change Management, Collaborative working, Customer
Centricity & Driving Execution. In addition, Value Selling and Customer Centricity
training program was also conducted for the sales professionals for the competency
development in value selling and Channel Management.
Investment in Subsidiaries/Joint Ventures
The Company has made new equity investments in Subsidiaries/ Joint Ventures in FY
2022-23 as follows:
Name of the Company |
Rs in Lakhs |
Forbes Macsa Private Limited |
Rs 0.50 Equity Capital and Share Application money - Equity - '124.50
Share Application money-Preference- '125.00 |
Forbes Precision Tools and Machine Parts Limited |
Rs 5.00 Equity Capital |
Subsidiaries/ Associates /Joint Ventures
During FY 2022-23 the following company(s) have become or ceased to be subsidiaries,
joint ventures or associates.
Name of Company |
Nature of Relationship |
Forbes Campbell Services Limited |
Ceased to be subsidiary with effect from September 30, 2022 consequent
upon amalgamation with Forbes Technosys Limited |
Forbes Facility Services Private Limited |
Ceased to be subsidiary with effect from June 22, 2022 consequent upon
divestment of shareholding in the company. |
Lux del Paraguay SA |
Ceased to be a subsidiary of Lux International AG with effect from
November 30, 2022 |
Forbes Precision Tools and Machine Parts Limited |
Incorporated as a wholly owned subsidiary with effect from August 30,
2022 |
Forbes Macsa Private Limited |
Incorporated as a Joint Venture Company with effect from December 9,
2022 |
Details of subsidiaries, associate companies and joint venture companies are set out in
the statement in Form AOC-1, pursuant to Section 129 of the Act and, is attached,
herewith, as Annexure "I". Financial Statements of these subsidiaries are
available for inspection at the registered office of the Company and that of the
subsidiary company concerned and the same would be also available on the website of the
Company, www.forbes.co.in/
Dividend & Transfer to Reserves
Your Company has paid Special interim dividend of Rs 65 per fully paid equity share of
Rs 10 each for the financial year 2022-23. With a view to preserve resources, there shall
be no further distribution of dividend for the current year in discussion.
In accordance with SEBI LODR, the Board of Directors of the Company has adopted a
Dividend Distribution Policy, which is available on the website of the Company,
www.forbes.co.in/ No amount has been transferred to the reserves during the year.
Share Capital
The paid-up Equity Share Capital of the Company as on March 31, 2023 was '1,289.86
Lakhs. During the year under review, the Company has not issued any shares with
differential voting rights or sweat equity shares' and has not granted any stock
options. As on March 31,2023 only one Director of the Company holds 1352 equity shares in
the Company. None of the other Directors hold shares of the Company.
Finance
The Board is pleased to inform the stakeholders that the Company is now Net Debt Free
as on March 31, 2023. The Company continues to focus on judicious management of its
working capital. Relentless focus on receivables, inventories, strict cost control and use
of alternative borrowing instruments, where possible, and the sale of assets has helped in
keeping the borrowings and effective interest cost under control.
Deposits
The Company has not accepted deposits from public falling within the ambit of Section
73 of the Act and The Companies (Acceptance of Deposits) Rules, 2014.
Particular of loans, guarantees and investments
Particular of Loans, Guarantees and Investments covered under provisions of section 186
of the Act are given in the notes to the Financial Statements.
Related Party Transactions
All related party transactions that were entered into during the financial year were on
arm's length basis and were in the ordinary course of business. There were no material
related party transactions made by the Company with Promoters, Directors, Key Managerial
Personnel or other designated persons which may have a potential conflict with the
interest of the Company at large.
All related party transactions are placed before the Audit Committee for approval.
Prior omnibus approval of the Audit Committee is obtained for transactions which are of a
foreseen and repetitive nature. The transactions entered pursuant to the omnibus approval
so granted are placed before the Audit Committee on a quarterly basis.
The policy on Related Party Transactions as approved by the Board is uploaded on the
Company's website.
Vigil Mechanism/Whistle Blower Policy
The Company has Whistle Blower Policy/Vigil Mechanism to deal with instances of fraud
and mismanagement, if any. The Policy is also available on the website of the Company.
Remuneration Policy
The Board has on the recommendation of the Nomination and Remuneration Committee,
framed a policy for selection and appointment of Directors, senior management personnel
and their remuneration. Remuneration Policy of the Company acts as a guideline for
determining, inter alia, qualification, positive attributes and independence of a
Director, matters relating to the remuneration, appointment, removal and evaluation of the
performance of the Director, Key Managerial Personnel and senior managerial personnel.
Nomination and Remuneration Policy is annexed as Annexure "II" to this report.
Business Responsibility and Substainability Report
The requirements under Regulation 34 (2)(f) and the proviso thereof of the SEBI
(Listing Obligations and Disclosure Requirements), 2015 is not applicable to the Company
as the Company was not in the list of top 1000 listed entities based on market
capitalization as on March 31, 2022 and March 31, 2023.
Internal Complaints Committee
The Company has zero tolerance for sexual harassment at workplace and has adopted a
policy on prevention, prohibition and redressal of sexual harassment at workplace as per
with the provisions of the Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal
of complaints of sexual harassment at workplace. Internal Compliant Committee (ICC) has
been setup to redress complaints received regarding sexual harassment as per Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the
ICC includes external member. During FY 2022-23, no complaints on sexual harassment were
received.
Corporate Governance and Management Discussion and Analysis
The guiding principle of the Code of Corporate Governance is harmony' i.e.,
balancing the need for transparency with the need to protect the interest of the Company
and balancing the need for empowerment at all levels with the need for accountability. A
detailed report on Corporate Governance forms part of Annual Report. The Management
Discussion and Analysis' forms part of this report.
Corporate Social Responsibility (CSR)
The Company is committed to its stakeholders to conduct business in an economically,
socially and environmentally sustainable manner that is transparent and ethical.
The Company is committed to inclusive, sustainable development and contributing to
building and sustaining economic, social and environmental capital and to pursue CSR
projects, as and when required, that are replicable, scalable and sustainable with a
significant multiplier impact on sustainable livelihood creation and environmental
replenishment.
The total amount to be spent during the financial year 2022-23 was Rs 28.05 Lakhs.
The Report on CSR activities, in terms of Section 135 of the Act, is annexed as
Annexure III to this report.
Risk Management
The Board of Directors of the Company has formed a Risk Management Committee for
identification, evaluation and mitigation of external and internal material risks. The
Committee has established a framework for the company's risk management process and
ensures its implementation. The Committee periodically reviews the risk management
processes and practices of the Company and establish and amends procedures to mitigate
risks on a continuing basis.
Significant and Material Orders Passed by the Regulators or Courts
There are no significant material orders passed by the Regulators / Courts which would
impact the going concern status of the Company and its future operations.
Directors and Key Managerial Personnel
As per provisions of Section 152(6) of the Act, Mr. Shapoor P. Mistry is due to retire
by rotation at the ensuing Annual General Meeting and being eligible, seeks
re-appointment. The Board of Directors recommends his re-appointment as Director of the
Company.
The Company has received declarations from all the Independent Directors of the Company
confirming that they meet with the criteria of Independence as prescribed both under the
Act and SEBI LODR and there has been no change in the circumstances which may affect their
status as Independent Directors during the year.
During the year under review, the non-executive directors of the Company had no
pecuniary relationship or transactions with the Company, other than sitting fees,
Commission and reimbursement of expenses incurred by them for the purpose of attending
meetings of Board/Committee of the Company. One of the Directors holds 1352 Equity shares
of the Company and is entitled to all rights and obligations as of other shareholders.
Independent Directors are familiarized with their roles, rights and responsibilities in
the Company through induction programmes at the time of their appointment as Directors and
through presentations made to them from time to time. The details of familiarization
programmes conducted have been hosted on the website of the Company and can be accessed at
www.forbes.co.in/
Pursuant to the provisions of section 203 of the Act, Mr. M. C. Tahilyani, Managing
Director, Mr. Nirmal Jagawat, Chief Financial Officer and Ms. Rupa Khanna, Company
Secretary & Compliance Officer are the Key Managerial Personnel of the Company as on
March 31, 2023.
Audit Committee of the Board of Directors
The details pertaining to the composition of the Audit Committee of the Board of
Directors are included in the Corporate Governance Report which forms part of this report.
Board Evaluation
Pursuant to the provisions of the Act and SEBI LODR, the Board has carried out an
annual performance evaluation of its own performance, the directors individually, as well
as the evaluation of the working of its Audit, Nomination and Remuneration, Stakeholders'
Relationship Committees.
The performance of the Board was evaluated by the Board after seeking feedback from all
the Directors based on the parameters/criteria, such as, degree of fulfillment of key
responsibility by the Board, Board Structures and Composition, establishment and
delineation of responsibilities to the Committees, effectiveness of Board processes,
information and functioning, Board culture and dynamics and quality of relationship
between the Board and the Management.
The performance of the committees viz. Audit Committee, Nomination and Remuneration
Committee, Corporate Social Responsibility and Stakeholders' Relationship Committee was
evaluated by the Board after seeking feedback from Committee members based on parameters/
criteria such as degree of fulfillment of key responsibilities, adequacy of committee
composition, effectiveness of meetings, committee dynamics and, quality of relationship of
the committee with the Board and the Management.
The Board and the Nomination and Remuneration Committee reviewed the performance of the
individual Directors based on selfassessment questionnaire and feedback/inputs from other
Directors (without the concerned director being present).
In a separate meeting of Independent Directors, performance of Non-Independent
Directors of the Board as a whole and the performance of the Chairman were evaluated.
Disclosure as required under Section 197 (12) of Act read with Rule 5 of The Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure
IV' to this Report.
Meetings of the Board
The Board met at least once in each quarter and 8(eight) meetings of the Board were
held during the year and the maximum time gap between two Board meetings did not exceed
the time limit prescribed in the Act. The details have been provided in the Corporate
Governance Report.
Directors' Responsibility Statement
Pursuant to the provisions of Section 134(5) of the Act, the Directors, based on the
representations received from the operating management, confirm that:
(i) in the preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures;
(ii) they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view
of the state of affairs of the Company at the end of the financial year and of the profit
or loss of the Company for that period;
(iii) they have taken proper and sufficient care to the best of their knowledge and
ability for the maintenance of adequate accounting records in accordance with the
provisions of this Act, for safeguarding the assets of the Company and detecting fraud and
other irregularities;
(iv) they have prepared the annual accounts on a going concern basis;
(v) they have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and are operating effectively; and
(vi) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
Audit Report
On a Standalone basis, there are no qualifications stated in the audit report and hence
there is nothing specific to comment on the Standalone Audit Report, other than the
comments mentioned in the report itself, which are self-explanatory.
As regards, the Consolidated Financial Statements, the Statutory Auditors have given a
disclaimer and has expressed their inability to provide an opinion on the state of affairs
of the Consolidated financials of the Company. There are two points for which the
Statutory auditor have expressed an opinion of disclaimer. In connection with these
points, the response are given hereunder:
With respect to Lux International AG for non-availability of audited accounts -
The reporting of the entity Lux International AG (LIAG) is periodic and based on the
information from the subsidiary for consolidation purposes. The information related to the
company, LIAG has been provided to the component auditor and the review was conducted,
with unsigned draft reports being available, but the final signed audit report, with their
stated opinion, has not been issued by the component auditor. The Management certified
accounts as shared by the management of LIAG with the component auditors has been included
in the consolidated accounts.
While on the subject, it is pertinent to note that before the finalisation of the
report, the company, LIAG along with Forbes Lux International AG, and Lux Schweiz AG filed
an application for Debt restructuring moratorium with the Competent court in Switzerland,
on April 11, 2023 and the procedure was granted by a court order on April 17 2023.
Accordingly, an Administrator has been nominated, to whom the Chief Executive Officer of
the company has to report, and this procedure leads to a strict and limited release of
payments by the Administrator, to protect the legitimate interests of the creditors,
including the payment to these auditors. The component auditors have made it clear to the
management of LIAG and have expressed their inability to release the signed report unless
their settlements happened. The opinion of disclaimer made by the Statutory Auditors is
for the formal non-coverage of this entity i.e., LIAG, though all information required to
be included in consolidated, has been considered and disclosed, except for the formal
signed audited accounts. The situation will get remedied when the component auditors issue
their formal report, after the matter is raised with the Administrator and the issue
resolved.
It is also important to note that the results for the first 9 months (from Jan 2022 to
Sept 2022) were made available by the component auditor as part of the limited review and
these have been included in the consolidated accounts, quarter to quarter and now for the
full year too. We believe that the risk of error for the full year unaudited accounts is
therefore minimal or non-existent.
It is also pertinent to note that the full investment value has been provided in the
standalone accounts of the Company in the FY 202122 itself and this has therefore no risk
or consequences, except for the reporting of the Consolidated Accounts for the year. On
the commercial side the local management is exploring revival plans and Board of your
Company shall take a final call on the evaluation in the next few Quarters.
The Auditor views arise from the situation of the business and for non-availability of
the formal signed financials and Audit report for LIAG. While we believe that all
financial reporting is in order as the certified management accounts of LIAG has been
considered, we conclude that the accounts of LIAG are complete and there are no material
deviations as at March 31, 2023.
With respect to Forbes Lux International AG on going concern matter:
The component Auditor has issued as adverse opinion on Forbes Lux International AG
(FLIAG). This was due to fact that the liabilities exceeded its assets by Rs 45,869 lakhs
as on December 31, 2022. The component Auditors believe that the available liquidity is
not sufficient to cover over indebtedness and future expected losses. Since this impacted
the solvency of the company, the Auditors expressed their adverse opinion in this matter
and were of the view that the accounts should not be prepared under the going concern
assumption. The management of the FLIAG is of the opinion that they are exploring options
to improve the liquidity through some manner by which funds could be infused and there by
overcome the current crisis. As mentioned for the earlier period qualification too, the
Board of your Company shall take a final call based on the proposal brought by the board
of FLIAG and the decision on the final evaluation shall be made accordingly. Therefore, it
may be appropriate to continue to prepare the accounts on going concern assumption till
the matter is decided and concluded in next few quarters.
As regards FLIAG, on the matter of treating FLIAG as going concern, we noted that the
business in its subsidiaries still operate, albeit the volume of business needs to be
larger. As mentioned earlier, this business decision will be taken in the next few
quarters after considering how its key subsidiaries are able to revive their own
operation. Till then it would be fair and proper to treat it as going concern.
Auditors and Audit Report Statutory Auditors
Pursuant to the provisions of section 139 of the Act read with the Companies (Audit and
Auditors) Rules, 2014, M/s Sharp & Tannan Associates (ICAI Firm Registration
No.109983W) are Statutory Auditors of the Company till the conclusion of 108th Annual
General Meeting of the Company.
The Audit Report forms part of the Annual Report. The Auditors have referred to certain
matters in their report on Financial Statements to the shareholders, which read with
relevant notes forming part of the accounts, is self - explanatory.
Cost Auditors
As per the requirements of Section 148 of the Act read with The Companies (Cost Records
and Audit) Rules, 2014, the cost accounts of the Engineering Division and Project Vicinia
of the Company are required to be audited by a Cost Accountant. The Board of Directors of
the Company have, on the recommendation of the Audit Committee, appointed M/s. Kishore
Bhatia & Associates, Cost Accountants, as Cost Auditors for the FY 2023-24 on a
remuneration of Rs 4 lakhs plus applicable taxes and out of pocket expenses.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules,
2014, the Company has appointed Makarand M. Joshi & Co, a firm of Company
Secretaries in Practice, to undertake the Secretarial Audit of the Company. The Report of
the Secretarial Auditor is annexed herewith as Annexure V'.
The Secretarial Audit Report does not contain any qualification, reservation or adverse
remark or disclaimer.
The Secretarial Audit Report of material subsidiaries, Forbes Bumi Armada Limited and
Forbes Campbell Finance Limited is also annexed herewith as Annexure VI' & VII'
respectively.
Secretarial Standards
The Company has complied with the applicable provisions of the Secretarial Standards
issued by the Institute of Company Secretaries of India.
Particular of Employees and Energy Conservation, Technology Absorption and Foreign
Exchange Earnings and Outgo
(a) The information required pursuant to Section 197 of the Act read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of
employees of the Company, will be provided upon request. In terms of Section 136 of the
Act, the Report and Accounts are being sent to the Members, excluding the information on
employees' particulars which is available for inspection by the Members at the Registered
Office of the Company during the business hours on working days of the Company. Any member
interested in obtaining such particulars may write to the Company Secretary at the
Registered Office of the Company.
(b) Information relating to the Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo stipulated under Section 134(3)(m) of the Act read
with Rule 8 of The Companies (Accounts) Rules, 2014 is annexed herewith as Annexure
VUI'.
Annual Return
Pursuant to section 92(3) read with section 134(3)(a) of the Act, the Annual Return as
on March 31, 2023 is available on the website of the Company viz. www.forbes.co.in/
Insolvency and Bankruptcy Code 2016
During the financial year, neither any application nor any preceding is initiated
against the Campany under the Insolvency and Bankruptcy Code 2016.
Settlement with Banker or Financial Institutions
During the financial year no settlements were made by the Company with any Banks or
Financial Institutions.
Cautionary Statement
Statements in the Board's Report and the Management Discussion & Analysis
describing the Company's objectives, expectations or forecasts may be forward-looking
within the meaning of applicable securities laws and regulations. Actual results may
differ materially from those expressed in the statement. Important factors that could
influence the Company's operations include global and domestic demand and supply, input
costs, availability, changes in government regulations, tax laws, economic developments
within the country and other factors such as litigation and industrial relations.
Acknowledgements
Your Directors acknowledge and thank all stakeholders of the Company viz. customers,
members, employees, dealers, vendors, banks and other business partners for their valuable
sustained support and encouragement. Your Directors look forward to receiving similar
support and encouragement from all stakeholders in the years ahead.
For and on behalf of the Board
Shapoor P. Mistry
Chairman
DIN: 00010114
Mumbai, May 26, 2023
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