ASM Technologies Ltd
Chairman Speech
Dear Stakeholders,
Over the past three decades, ASM has firmly established itself as a
global leader in the areas of Engineering Services and Design led Manufacturing (DLM). The
last year has only solidified our presence and reputation in these areas.
DLM is an integrated approach in which our highly skilled designers and
manufacturing engineers collaborate closely to manage every aspect of a product's
life cycle. We take up complete ownership of the end-to-end design, development and
manufacturing. We support and value engineer the entire product lifecycle. It also allows
us to ensure design excellence and produce high-quality products, while reducing costs and
increasing speed-to-market.
In recent years, given the strong engineering competence and
capabilities that India provides coupled with geopolitical factors has led to several
global enterprises move their design and manufacturing needs to India. This "India
pivot" can be traced to Indian-born but globally-conscious companies like ASM that
provide cost effective, global-quality engineering and product design services. We believe
that India will become a DLM hub in the near future, with Indian firms like ASM leading
the way forward with high-value DLM services and solutions.
ASM has been an environmentally- socially- and governance-conscious
firm. In recent years, we have started several new ESG initiatives and strategies that
support our goals to be a steward of the environment, a champion of our people, and an
well governed organization. We will stay true to the ESG path we have set for ourselves
and continue to fulfill our responsibilities to our customers, the environment, and the
communities we operate in.
Future Outlook
We had a successful financial year on several counts. Not only did we
convert our financial projections to reality, we also achieved all the operational and
human resource-related goals we had set for ourselves. We continue to progress from design
to a design-led manufacturing (DLM) company. We have substantially increased our
infrastructure, production facilities, talent pool, and processes.
In the near future, we will continue to grow our DLM Our focus area
will be:
• Investments in fixed assets: We will scale up our
investments in fixed assets, including physical infrastructure that will enable us to
design and manufacture high-quality products for a global market.
• Investments in people: Knowing that DLM is all about
designing for human needs and purposes, we will invest more in the most critical asset for
our business: people. In addition to hiring new talent, we are also upgrading our training
and development programs for existing employees to ensure that we can effortlessly handle
all aspects of DLM and deliver all its benefits to our customers.
• Strategic acquisitions: We will continue to look for
strategic acquisitions and partnerships that will allow us to innovate more, expand global
foot print and achieve greater cost/operational economies of scale.
• Product qualifications: We will continue with our new
product initiatives with necessary qualification for future volume manufacturing.
This past year has opened up new avenues for ASM, particularly in DLM.
We will keep exploring growth avenues and scale up our efforts and investments to become
DLM leader.
On behalf of the company management and leadership, I take this
opportunity to thank:
-Our esteemed customers, stakeholders, vendors, business partners,
advisors and consultants for their support, -Employees for their valuable contributions,
sustained efforts, and dedicated spirit,
-India- State Bank of India, Incube Branch, ICICI Bank Limited, Axis
Bank Limited, HSBC Bank
US- HSBC Bank, Premier Bank
UK- State Bank of India
Singapore- Indian Bank, ICICI Bank
Japan- State Bank of India, Rakuten Bank.
-Central and State Government, Customs, Reserve Bank of India, Software
Technology Parks (STPI) and NASSCOM for their guidance.
Rabindra Srikantan Managing Director
Place: Banglore Date: 30th May 2023
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ASM Technologies Ltd
Directors Reports
To the Boards' Members,
We are pleased to present the 31st Annual Report together
with the Audited Accounts of your Company for the year ended 31stMarch2023
1. Financial Results (Rs. In Mn.)
|
2022-2023 |
2021-2022 |
| Income from Software services and Products |
1391.50 |
1410.71 |
| Other operating income |
104.85 |
61.42 |
| Expenses |
|
|
| Employee benefits expense |
865.97 |
936.78 |
| Finance Costs |
38.58 |
31.35 |
| Depreciation |
22.96 |
18.08 |
| Other expenses |
349.34 |
300.61 |
| Profit/(Loss) before tax |
219.50 |
185.31 |
| Current Tax |
59.63 |
54.93 |
| Deferred Tax Income/expense |
4.78 |
(8.42) |
| Excess provision of earlier years |
- |
7.03 |
| Profit/(Loss)for the year |
155.09 |
131.77 |
| Other Comprehensive Income |
|
|
| A (i) Items that will not be reclassified to profit or loss
Remeasurement of defined benefit plans |
1.81 |
2.34 |
| (ii) Income tax relating to items that will not be
reclassified to profit or loss Deferred tax on remeasurement of defined benefit plans |
(0.46) |
(0.59) |
| B (i) Items that will be reclassified to profit or loss
Changes in fair value of investments in equity instruments |
4.93 |
26.39 |
| (ii) Income tax relating to items that will be reclassified
to profit or loss Deferred tax on changes in fair value of investments in equity
instruments |
(1.24) |
(6.64) |
| Total comprehensive income for the year |
160.13 |
153.27 |
2. Results of Operation
ASM along with its subsidiaries provide world class consulting and
product development services in the areas of Engineering Services, and Deign led
manufacturing with successful Offshore Development with Support Centers in India and
Overseas for its global clientele.
During the financial year, the Company explored new growth
opportunities and performed significantly well in both the domestic as well as
international markets. The performance reflects ASM's journey to reposition itself as a
unique technology solutions provider that is committed to develop an emerging breed of
platforms, thus enabling its customers to gain competitive advantage through the
Company's future ready digital transformation initiatives.
On the standalone front your company registered a total revenue of
Rs.1391.50 Mn for the year ended 31st March 2023.
Domestic sales was Rs. 577.63 Mn while Export sales was Rs. 813.87Mn.
EBIDTA was at Rs.281.04 Mn and Net profit after tax was Rs.155.09 Mn.
The Consolidated total revenue for the year ended 31st March 2023 was
Rs.2204.08 Mn. EBIDTA was at Rs. 273.37 Mn and Net Profit after tax at Rs. 71.45 Mn.
3. Dividend/ Transfer to reserves
During the year 2022-23 the company declared an Interim dividend of Rs.
1.00/- on 6th August, 2022 and 2nd Interim dividend of Rs. 1.00/- on 9th November, 2022
followed by 3rd Interim dividend of Rs.1.00/- on 8th February 2023. In keeping with the
Dividend policy your Directors are pleased to recommend for approval of the members a
final dividend of Rs.4.00/- per equity share of Rs 10/-each for the financial year
2022-2023. The dividend amount paid/payable if approved by shareholders will be Rs. 56.65
Mn. including partly paid up shares for the year.
The dividend payout for the year under review has been formulated in
accordance with the Company's policy to pay sustainable dividend linked to long term
growth objectives of the company to be met by internal cash accruals and the
shareholders' aspirations.
Your Company has not transferred any amount to reserve for the
Financial Year ended 31st March, 2023.
The company has 1,10,00,000 issued and listed equity shares of face
value of Rs. 10 each out of which 10,00,000 equity shares are partly paid up as on 31st
March 2023.
4. Subsidiary Companies
The consolidated Accounts of your Company and its subsidiaries viz.,
ASM Digital Technologies Pte Ltd (Formely known as Advanced Synergic Pte Ltd), Singapore,
ASM Digital Technologies Ics (Formely known as Pinnacle Talent Inc), USA, ASM Technologies
KK, Japan, RV Forms & Gears LLP,ASM Digital Engineering Pvt Ltd. and ASM HHV
Engineering Pvt Ltd duly audited, are presented as part of this Report in accordance with
Indian Accounting Standards ( IndAs) and the Listing Regulations with the Stock Exchange,
wherever applicable. The statement pursuant to the provisions to Section 129(3) of the
Companies Act 2013, containing salient features of the financial statement of the
Company's Subsidiaries in FormAOCl is given in Annexure -II. The Accounts of the
Subsidiaries audited for the purpose of consolidation shall be placed on your
Company's website and made available for inspection by any Shareholder at the
Company's Registered Office and at the respective registered offices of the
Subsidiary companies. Copies can be made available on request, to the shareholders of the
Company.
Your Company has formulated and adopted a "Policy for determining
Material Subsidiaries" so that your company could identify such subsidiaries and
formulate governance framework for them. The Policy for determining ‘material'
subsidiaries is posted on Company's website: https://www.asmltd.com/policy-
disclosures
5. Future Outlook
This has been provided in letter to the shareholders
6. Management Discussion and Analysis Report
Management Discussion and Analysis Report as required under Regulation
34 of SEBI (Listing Obligations and DisclosureRequirements ) Regulations 2015, is
disclosed separately in theAnnual Report.
7. Board Meetings
During the year under review the Board of Directors held 4 meetings, on
30.05.2022, 06.08.2022, 09.11.2022 and 08.02.2023 The maximum interval between two
meetings did not exceed 120 days.
8. Directors and Key Managerial Personnel
As per the provision of companies Act 2013 Mr. Ramesh Radhakrishnan
(DIN 02608916) Director, retires by rotation and being eligible, offers himself for
re-appointment at the ensuing Annual General Meeting (AGM). The Board recommends his
appointment for consideration of members of the Company. Brief profile
of Mr. Ramesh Radhakrishan is given in the notes to the Notice of the
ensuing AGM.
9. Disclosure on compliance with Secretarial Standards
Directors confirm that the Secretarial Standards issued by the
Institute of Company Secretaries of India, have been complied with.
10. Independent Directors
Your Company has laid down procedures to be followed for familiarizing
the Independent Directors with your Company, their roles, rights, responsibilities in your
Company and to impart the required information and training to enable them contribute
significantly to your Company. All the Independent Directors of the Company have given
declarations that they meet the criteria of independence as laid down under section 149(6)
of the Act and Regulation 16(1)(b) of Listing Regulations. The Independent Directors have
also confirmed that they have complied with the Company's Code of Conduct. All the
Independent Directors of the Company have given declarations that they meet the criteria
of independence as laid down under section 149(6) of the Act and Regulation 16(1)(b) of
Listing Regulations.
11. Director's Responsibility Statement
Pursuant to the provisions of Section 134 (5)of the Companies Act 2013,
the Directors hereby confirm that:
a) in the preparation of the annual financial statements for the year
ended 31st March 2023 the applicable accounting standards has been followed along with
proper explanation relating to material departures:
b) the Directors 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;
c) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the provisions of the Act
for safeguarding the assets of the company and for preventing and detecting fraud and
other irregularities;
d) the Directors have prepared annual accounts of the company on a
going concern basis.
e) the Directors have laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and were
operating effectively.
f) The Directors have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were adequate and operating
effectively.
12. Significant and material orders passed by the regulators or courts
and Material Changes and commitments affecting the financial position of the company.
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. There are no material changes and commitments, if any, affecting the
financial position of the company which occurred between the end the financial year of the
company to which the financial statements relate and the date of this report.
13. Audit Committee
The Audit committee met four times during the financial year under
review and all its recommendations were accepted by the Board.
Your Company has established the Vigil Mechanism, an Ombuds process
which is a channel for receiving and redressing of employees complaints. This mechanism
covers questionable financial or accounting matters and reporting fraudulent financial
information to the shareholders, the government or any other legal authority. This meets
the requirement under Section 177(9) and(10) of the Companies Act, 2013 and Regulation 22
of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
14. Nomination and Remuneration Committee and Stakeholders Relationship
and Share Transfer Committee
The Nomination and Remuneration Committee has framed a policy for
selection and appointment of Directors including determining qualifications of Independent
Director, Key Managerial Personnel, Senior Management Personnel and their remuneration as
part of its charter and other matters provided under Section 178(3) of the Companies Act,
2013. A copy ofthe policy forms part of this report vide Annexure- I. The
Nomination and Remuneration Committee of a company has been obligated under Section 178 of
the Act to formulate a policy for recommending to the Board of directors of the company
forsetting the criteria based on which the performance of every Director including the
performance of the Board as a whole shall be assessed by the Board of Directors of the
Company.
15. Familiarisation Programme
The Company has put in place an induction and familiarisation programme
for all its Directors including the IndependentDirectors. The familiarisation programme
for Independent Directors in terms of provisions of Regulation 46(2)(i) of Listing
Regulations, is uploaded on the website of the Company.-https://www.asmltd.
com/policy-disclosures
16. SecretarialAudit
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and The Companies (Appointment and Remunerationof Managerial Personnel) Rules, 2014, the
Company has appointed BMP & Co., LLP, Company Secretaries, to undertake the
Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR3 for the
financial year ended March 31, 2023 is annexed as Annexure - III to the Report.
There are qualifications, reservations or adverse marks made by SecretarialAuditor in the
Report. It was an inadvertent delay. Details is provided in MR3 Report.
17. Auditor's Report
There are no qualifications, reservations or adverse remarks made by
M/s B K Ramadhyani & Co, LLP, Chartered Accountants Statutory Auditors, in their
report for the financial Year ended 31st March, 2023. The Statutory Auditors havenot
reported any incident of fraud under Section 143(12) of theAct and the rules made
thereunder to the Audit Committee ofthe company in the year under review.
18. Conservation of energy, technology absorption and Foreign Exchange
Outgo
The company's operations involve low energy consumption. However
the efforts to conserve and optimize the use of energy through improved operational method
and other means will continue.
The company has not imported any technology. Foreign exchange earnings
and outgo
During the financial year under review 58.49% of the revenue came from
export of software services resulting in a foreign exchange inflow of Rs.813.87Mn and the
foreign exchange outgo on account of overseas salaries, traveling etc was Rs. 109.42 Mn.
19. Public Deposits
Your Company has not accepted any deposits from the public during the
financial year under review.
20. Disclosures as required under Section 22 of Sexual Harassment of
Women at Workplace (Prevention, Prohibitionand Redressal) Act , 2013
Your Company has in place a Prevention of Sexual Harassment ( POSH)
Policy in line with the requirements of Sexual harassment of Women at Workplace (
Prevention, Prohibition and Redressal) Act 2013. Your Company has through the Policy
constituted a committee and has established a grievance procedure for protection against
victimization. Your Company is committed to provide a healthy environment to all employees
conducive to work without the fear of prejudice and gender bias. During the year under
review ,
| there were no cases filed pursuant to the said Act. |
|
| Number of complaint filed during the financial year 2022-23 |
Nil |
| umber of complaint disposed off during the financial year
2022-23 |
Nil |
| Number of complaint pending as end of the financial year |
Nil |
21. Details ofAdequacy of Internal Financial Controls
Your Company has deployed adequate Internal Control Systems in place to
ensure a smooth functioning of its business. The processes and systems are reviewed
constantly and improved upon to meet the changing business environment. The Control
Systems provide a reasonable assurance of recording the transactions of its operations in
all material aspects and of providing protection against misuse or loss of Company's
assets. The Internal auditors periodically review the internal control systems, policies
and procedures for their adequacy, effectiveness and continuous operation for addressing
risk management and mitigation strategies.
22. Particulars of Loans, guarantees or investments
During the Financial Year under review, your Company had given
Corporate Guarantee to its subsidiary, RV Forms & Gears LLP and ASM Digital
Engineering Pvt Limited and loan to RV forms and Gears LLP at prevailing bank lending rate
for meeting its working capital requirements. Thebalance outstanding as on 31st March,
2023 is Rs 329.21Mn.
23. Risk Management Policy
The Risk management Policy of your company continuously evaluates the
various risks surrounding business and seeks to review and upgrade its risk management
process. To further the endeavour your Board constantly formulates strategies directed at
mitigating these risks which get implemented at the Executive Management level and a
regular update is providedto the Board.
24. Credit rating of securities:
(a) credit rating obtained in respect of various securities: NA
(b) name of the credit rating agency; NA
(c) date on which the credit rating was obtained: NA
(d) revision in the credit rating: NA
(e) reasons provided by the rating agency for a downward revision, if
any: NA
25. Corporate Social Responsibility Policy (CSR)
Your company has formulated CSR policy which is posted on the website
at https://www.asmltd.com/policy- disclosures. In pursuance to the provisions of Section
135 and Schedule VII of the Companies Act, 2013 the company constituted a CSR Committee of
the Board to (a) formulate and recommend a CSR policy (b) recommend the amount of
expenditure to be incurred on the CSR activities and (c) monitor implementation of the CSR
policy from time to time. The terms of reference of the CSR committee are in accordance
with Section 135 of the Companies Act 2013. The Annual Report on CSR in the prescribed
format is enclosed to this Report as Annexure-IV.
26. Related Party Transactions
The company has in place formulated a Policy on materiality of Related
Party transactions for dealing with such transactionsin line with the requirements of the
Listing Regulations with the Stock Exchange. . The policy on related party transactions
isavailable on the Company's website at -https://www.asmltd.com/policy-disclo- sures.
Particulars of contracts or Arrangements with related parties referred
to in Section 188(1) of the Companies Act 2013 in theformat specified as Form AOC2 forms
part of this Report as Annexure- V
27. Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and the Listing
Regulations, the Board is required
to monitor andreview the Board evaluation framework. In line with the
Corporate Governance Guidelines, Annual PerformanceEvaluation is conducted for all Board
Members as well as the working of the Board and its Committees. The Board workswith the
Nomination and Remuneration committee to lay down the evaluation criteria for the
performance of executive/nonexecutive/independent directors through a peer evaluation,
excluding the director being evaluated through a Board effectiveness survey. The
questionnaire of the survey forms an integral part of reviewing the functioning and
effectiveness of the Board and for identifying possible paths for improvement. Each Board
member is required to evaluate the effectiveness of the Board and its committees on
various parameters and feed back on each Director is part of the survey. The outcome of
the Board evaluation for the financial year 2022-23 was discussed by the Board at their
meeting held on 8th February 2023.
28. Remuneration to Director and Employees
Details/Disclosures of ratio of remuneration to each Director to median
employee's remuneration as required pursuant toSection 197(12) of the Companies Act 2013
read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 and details of remuneration paid to Employees vide Rule 5(2) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given as Annexure-
VI
29. Corporate Governance Report
Your Company has taken adequate steps to adhere to all the stipulations
as laid down in Pursuant to Schedule V (C) of SEBI (Listing Obligations and Disclosure
Requirements) Regulations 2015. As required, a Report on Corporate Governance isprovided
elsewhere in thisAnnual Report along withAuditor's Certificate on compliance thereof.
30. Auditors
M/s. B K Ramadhyani & Co. LLP, Chartered Accountants, were
re-appointed as Statutory Auditors of the Company at the 30th Annual General Meeting
(‘AGM') held on July 16, 2022 for a period of 5 years, up to the conclusion of
35th AGM. M/s. B K Ramadhyani & Co. LLP have given their consent for their
re-appointment as Statutory Auditors of the Company and has issued certificate confirming
that their reappointment, if made, will be within the limits prescribed under the
provisions of Section 139 of the Companies Act, 2013 (‘the Act') and the rules
made thereunder. M/s. B K Ramadhyani & Co. LLP have confirmed that they are eligible
for the proposed appointment under the Act, the Chartered Accountants Act, 1949 and the
rules or regulations made thereunder. As confirmed to Audit Committee and stated in their
report on financial statements, the Auditors have reported their independence from the
Company and its subsidiary according to the Code of Ethics issued by the Institute of
Chartered Accountants of India (‘ICAI') and the ethical requirements relevant to
audit. Based on the recommendations of the Audit Committee and the Board of Directors, it
is hereby proposed to re-appoint M/s. B K Ramadhyani & Co. LLP, Chartered Accountants,
having registration No.0028785/S200021, as the Statutory Auditors of the Company for the
second and final term of five consecutive years, who shall hold office from the conclusion
of this 30th AGM till the conclusion of the 35 th AGM of the Company. The requirement for
the annual ratification of auditors' appointment at the AGM has been omittedas per
Companies (Amendment) Act 2017 notification on May 7 2018.
Total fees for all services paid by the Company and its subsidiaries,
on a consolidated basis, to the statutory auditor and allentities in the network
firm/network entity of which the statutory auditor is a part is given below:
Rs. in Mn.
| Payment to Statutory Auditors |
FY 2022-23 |
| Audit Fees |
1.57 |
| Others Service |
0.00 |
| Reimbursement of expenses |
0.09 |
| Total |
1.66 |
1. Acknowledgments
Your Directors take this opportunity to express their gratitude to -
Our esteemed customers, shareholders, vendors, business partners,
advisors and consultants for their unstinted support. The contribution made by our
employees at all levels. Our consistent growth was made possible by their solidarity,
cooperationand support.
- State Bank of India, (India), HSBC Bank Ltd (India), Axis Bank Ltd.,
(India), Indian Bank, (Singapore), HSBC Bank, (USA), Premier Bank (USA), State Bank of
India (UK), State Bank of India (Japan) and Rakuten Bank (Japan) for their support and
guidance.
- Customs, Reserve Bank of India, Software Technology Parks (STPI) and
NASSCOM, Central & State Governments, Software Technology Park (STPI) and NASSCOM for
their continued support.
|
For and on behalf of the Board of Directors |
|
|
ASM Technologies Ltd. |
|
| Place : Bangalore |
M. R. Vikram |
Rabindra Srikantan |
| Date : 30.05.2023 |
Chairman |
Managing Director |
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