GKN Driveline India Limited Unlisted Shares

Annual Report Summary

GKN Driveline (India) Limited's 39th Annual Report 2023-24: Summary

Notice of Annual General Meeting (AGM): The 39th AGM will be held on September 24, 2024, at 11:00 AM at the registered office in Faridabad.

Ordinary Business: The AGM will address:

• Adoption of audited financial statements for the year ending March 31, 2024.
• Re-appointment of Mr. Sanjay Katyal (DIN-08384025) and Mr. Rajeev Dogra (DIN-05270378) as directors, who are retiring by rotation.
• Confirmation of an interim dividend of INR 64 per share as the final dividend for FY 2023-2024.

Special Business:

• Resolutions for revision of remuneration for Mr. Sanjay Katyal, Mr. Madan Singh Sisodia and Mr. Rajeev Dogra and Ms. Lunna Bose Roy Chowdhury, as Managing/Executive Directors, are to be considered.
  • Specific details of the revised remuneration packages effective April 1, 2024, are provided for each director.
  • The payment of bonus amounts to Mr. Sanjay Katyal (INR 15,56,996.98), Mr. Madan Singh Sisodia (INR 17,28,826.78) and Mr. Rajeev Dogra (INR 12,96,706.42) and Ms. Lunna Bose Roy Chowdhury (INR 15,11,002.85) for performance of 2023 are subject to approval.
  • The Board is authorized to alter the remuneration with government/member approval as needed, within the limits of Schedule V of the Companies Act, 2013.
• Re-appointment of Ms. Rajni Sekhri Sibal and Mr. Bharat Dev Singh Kanwar as Independent Directors for a term of 3 years, subject to members' approval.

Notes on AGM Attendance & Voting:

• Members can appoint a proxy, with the proxy form to be submitted 48 hours before the meeting.
• Proxies can be inspected during business hours, with three days' notice.
• Only the joint holder highest in order of names can vote.
• A person can act as proxy for up to 50 members holding no more than 10% of the voting share capital.
• Corporate members should send a certified Board resolution and specimen signatures.
• Members/proxies must bring the attendance slip.
• Registers of Directors, Key Managerial Personnel, and contracts will be available for inspection.
• Members should advise the Company of postal address changes and provide their PAN.
• Electronic copies of the Annual Report and AGM Notice are being sent to members with registered email IDs.

Remote E-Voting:

• The e-voting period runs from September 21-23, 2024.
• Members as of the cut-off date (September 17, 2024) can vote electronically.
• The notice details login methods for individual shareholders holding securities in demat mode via NSDL and CDSL, as well as for shareholders holding securities in physical mode.
• Helpdesk details are provided for technical issues.

Explanatory Statement: The notice also includes an explanatory statement pursuant to Section 102 of the Companies Act, 2013, detailing the material facts related to the special business items.

Director's Report: The directors present the 39th Board Report. Financial performance:

• The company recorded a top-line growth of 6.83% compared to the previous year, mainly due to increase in market demand and new business wins.
• Revenue from Operations (net of excise duty) was INR 10518.34 Mn compared to INR 9845.46 Mn in the previous year.
• Profit before Tax, Interest and Depreciation (EBITDA) was INR 1594.05 Mn compared to INR 1484.6 in the previous year
• The directors state their satisfaction that the accounts give a true and fair view of the state of affairs of the company as at March 31, 2024.

State of Affairs and Operations: The company focused on maintaining industrial relations, people safety, and flexible business operations amid market challenges.

• The business environment was challenging due to demand volatility, global geopolitical tensions, and inflationary pressures.
• Emphasis was placed on people safety, environmental protection, and product quality.
• EHMS recertification audits were successful and zero LTA was sustained for the year, continuous focus on quality systems and IATF 16949 surveillance audit completed without non-conformance.
• GKN Quality Olympics Platinum award received in 2024
• MSIL zero defect Quality Award in May 24.
• Received HCIL Quality and delivery silver award for spares in March 2024

Dividend:

• The board declared an interim dividend of INR 64 per equity share for the year 2023-24, which will be considered as the final dividend.

Auditors:

• Deloitte Haskins & Sells LLP, Gurugram, are the statutory auditors, who have not given any qualifications, reservations, adverse remarks or disclaimer.

Foreign Exchange:

• Estimated value of contracts in capital account remaining to be executed is 245.02 Mn, as at 31.03.2024.
• Foreign currency outflow in 2023-24 amounted to EUR 5.11 Mn, USD 10.20 Mn, JPY 73.06 Mn and GBP 1.73 Mn.
• Foreign currency inflow in 2023-24 was USD 6.14 Mn.

Conservation of Energy:

• The company implemented various energy conservation measures, such as replacing inefficient motors, controlling compressed air leakages, and installing auto-timer systems.

Technology Absorption:

• The company maintains interaction with GKN Group internationally and continuously imports and fully absorbs technology from GKN Group under technical collaboration agreements.

Automotive Industry Outlook:

• The Indian auto retail sector achieved 10% YoY growth in FY24, with all vehicle segments registering positive growth.
• The industry is optimistic for FY25, focusing on EV launches, leveraging economic growth, and favorable government policies.

Corporate Social Responsibility (CSR):

• The company has a CSR policy in accordance with Section 135 of the Companies Act, 2013.
• The total amount spent on CSR activities during FY 2023-24 was INR 16.91 Mn, which was slightly less than the required amount of INR 17.61 Mn
• CSR initiatives included government school infrastructure development, sanitation, education, and environmental sustainability projects.

Loans, Guarantees, and Investments:

• The Company did not extend loans or guarantees or invested in other companies.

Secretarial Standards:

• Applicable Secretarial Standards SS-1 and SS-2 were followed.

Director's Responsibility Statement: The directors confirmed that applicable accounting standards were followed, appropriate accounting policies were selected, adequate accounting records were maintained, and the annual accounts were prepared on a going concern basis.

Health, Safety, and Environment:

• The company is committed to continuous improvement in health and safety and achieved zero loss time accidents in all plants, a comprehensive safety program is in place.

Legal and Governance:

• The company has a strong legacy of practicing fair, transparent and ethical governance.
• The company has established systems, procedures and policies to ensure that its Board of Directors is well informed and well equipped to discharge its overall responsibilities and provide the management with the strategic direction catering to exigency of long-term shareholders value

Vigil Mechanism:

• The Company has a whistleblowing hotline run by an external third party.

Secretarial Audit:

• The Secretarial Audit was carried out by M/s Ranjeet Pandey & Associates, however, application for amendment in registration certificate was not made by the Company within prescribed time.

Remuneration:

• Managerial remuneration details for FY 2023-24 for Mr. Sanjay Katyal, Mr. Madan Singh Sisodia, Mr. Rajeev Dogra and Ms. Lunna Bose are given.

Board of Directors & Key Management Personnel:

• The notice details appointment and remuneration policy for directors and KMPs.
• The Board comprises of executive and independent directors, with details on board structure and composition.

Audit & Risk Management Committee:

• The composition of the Audit & Risk Management Committee (ARMC) is described.

Stakeholders' Relationship Committee

• The members of the stakeholders committee as well as the details of the meetings attended are attached.

Corporate Social Responsibility Committee

• The composition of the Corporate Social Responsibility Committee is described as well as the projects this committe is focusing on. The CSR plan for Financial Year 2024-2025 was finalized and the projected amount of spent is INR 19 Mn approx

Independent Director's Meeting:

• Independent Directors of the Company met separately on 27th February 2024 for FY 2023-2024 without the presence of Non-Independent Directors and members of management

Related Party Transactions (Section 188):

• Proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties

Risk management, Internal Controls and Internal Financial Controls:

• The Board gives significant attention to, and accepts its responsibility for, the company's risk management internal control and internal financial controls.

Internal Audit

• The Company has appointed M/s R Mahajan & Co, Chartered Accountants, who conducts internal audit of the company and its five plants on quarterly basis, the auditors submits plant wise and areas wise report every quarter.

Internal Financial Controls

• The Company has adopted adequate policies and procedures for robust internal controls to ensure orderly conduct of business, adherences to such policies and procedures, safeguarding of assets, true and fair conduct of business, prevention and detection of fraud & errors, accuracy and completeness of accounting records and timely preparation of reliable information

General Declaration:

• All independent directors have given declarations as per the Companies Act, 2013.

Technology Absorption, Adaptation and Innovation:

• The company has been driving organization for financial excellence leading to growth in bottom line commensurate with growth in top line.
• Company is receiving support and guidance from GKN Group to drive functional excellence in marketing, human resource, application engineering, supply management and information technology, among others

Capital Commitments, Material Changes, and Other Statements:

• The company have been spending time and effort to help promote their sustained growth and environmental sustainability *The Board recommends the resolutions set out in Item No. 8 for the approval of members.

Finance: The summary for the financial statements are provided and show the yearly performance increase.