San Engineering and Locomotive Company Limited Unlisted Share Price

Annual Report Summary

SAN ENGINEERING AND LOCOMOTIVE COMPANY LIMITED - 54th Annual Report Summary (2023-2024)

Corporate Information:

• Lists the Board of Directors including Mr. Milind S Thakker (Chairman), Mr. Jasjiv Sahney (Independent Director), Mr. Apparao Mallavarapu (Independent Director), Mr. Udayant Malhoutra (Independent Director), Mr. Inder Mahadevan (Independent Director until September 29, 2023), Mr. Shiv Dayal (Additional Independent Director from June 26, 2024), Mr. Yash Gupta (Additional Independent Director from June 26, 2024), and Mr. Ramanathan Narayanan (Managing Director).
• Company Secretary: Ms Sunitha K S
• Statutory Auditors: Messrs NR Rajagopalan & Co., Chennai
• Bankers: State Bank of India
• Factories: Whitefield Road (Bengaluru), Hebbal Industrial Area (Mysuru), Industrial Park (Patancheru, Hyderabad)
• Registered Office: Bengaluru
• Corporate Identification Number (CIN): U74210KA1973PLC002424
• Website: www.san-engineering.com
• Contact Email: comsec@san-engineering.com
• Registrar and Transfer Agents (RTA): Canbank Computer Services Limited, Bengaluru.

54th Annual General Meeting (AGM) Notice:

• The 54th AGM will be held on Friday, September 6, 2024, at 11:30 A.M (IST) at the Registered Office in Bengaluru.
• Ordinary Business includes: Adoption of Standalone and Consolidated Audited Financial Statements for the year ended March 31, 2024; Declaration of a dividend of ₹10 per share; Appointment of Mr. Milind S Thakker, who retires by rotation.
• Special Business includes: Appointment of Mr. Shiv Dayal and Mr. Yash Gupta as Independent Directors for 5 years, effective June 26, 2024, subject to shareholder approval; Ratification of remuneration of the Cost Auditor Messrs. Murthy & Co LLP with remuneration of ₹1.00 lakh plus taxes and out of pocket expenses.
• Relevant Explanatory Statements regarding the special business are annexed.
• A member entitled to attend and vote can appoint a proxy, which need not be a member. Proxies must be received 48 hours before the meeting.
• The Register of Members and Share Transfer books will be closed from August 30, 2024, to September 6, 2024, inclusive.
• Dividend, if declared, will be payable on or before October 5, 2024, to members on the register as of August 29, 2024.

Directors' Report:

• The 54th Annual Report highlights the performance of the Company with Audited Accounts for the year ended March 31st 2024.
• Financial Results (₹ in Million):
  • Net Sales and Other Income: 2292.31 (2023-24) vs 2004.00 (2022-23)
  • Profit before Finance Cost, Depreciation and Taxes: 447.10 vs 317.40
  • Profit Before Tax: 376.20 vs 252.20
  • Profit for the period: 287.10 vs 187.00
• A dividend of ₹10 per equity share (100% of nominal value of ₹10) is recommended for the year ended March 31, 2024. Cash outflow would be ₹ 44.50 Million.
• ₹350 Million is proposed to be transferred to the General Reserve.
• Net Sales and other income were ₹2292.31 Million (2023-24) compared to ₹2004.00 Million (2022-23). Profit before tax was ₹376.20 Million against ₹252.20 Million.
• The company supplied 20 shunting locomotives, 5 power packs for High Speed Accident Relief Trains (HS SPART) to ICF, 5 Diesel Electric Tower Cars (DETC), and 400 sets of Gears and Pinions to Alstom.
• The company opened the year with an order backlog of about ₹ 4000 Million, including Diesel Electric Tower Cars (DETC), Rail Borne Maintenance Vehicles (RBMV), Worksite Tampers, Inspection Vehicles, and gears. Prototypes of RBMV are under testing, and supply of DETC's to Indian Railways has commenced.
• Mr. Inder Mahadevan resigned from the Board effective September 29, 2023.
• No public deposits were accepted.
• The Board confirms compliance with Section 134(5) of the Companies Act, 2013, regarding accounting standards, policies, maintenance of records, and preparation of accounts on a going concern basis.
• The Board appointed Mr. Shiv Dayal and Mr. Yash Gupta as Additional Independent Directors (Non-Executive) until the 54th AGM.
• The Board recommends re-appointment of Mr. Shiv Dayal and Mr. Yash Gupta as Independent Directors for 5 years, effective June 26, 2024.

Board Meetings & Committees:

• Four Board meetings were held during the financial year.
• Three audit committee meetings were held.
• The Corporate Social Responsibility (CSR) Policy focuses on education, eradication of hunger, skill development, environment protection, and healthcare, aiming to spend 2% of average net profits on CSR. A CSR committee meeting was held on June 22nd, 2023, and the CSR report is included as Annexure A.
• The Nomination and Remuneration Committee is in place, and the Remuneration policy is on the company website.
• A policy on 'Protection of Women's Rights at Workplace' is in place, and no sexual harassment complaints were received in 2023-24.

Subsidiaries, Related Parties & Risk Management:

• The company has two subsidiaries: San Motors Limited and San Rolling Stock Services Limited. Details are in Note no. 39 to the consolidated financial statements and Form AOC-1 (Annexure D).
• Related party transactions were at arm's length.
• The company has internal financial controls and is strengthening its business processes with standard operating procedures and internal control systems.

Other Disclosures:

• Independent directors have provided declarations meeting independence criteria.
• Messrs N R Rajagopalan & Co are the Statutory Auditors until calendar year 2027.
• There are no qualifications, reservations, or adverse remarks in the auditor's report.
• Cost records are maintained, and Messrs Murthy & Co. LLP are the Cost Auditors for 2024-25.
• Information on employees is in Annexure C.
• Information on conservation of energy, technology absorption, and R&D is provided.
• Expenditure on R&D and foreign exchange earnings & outflow are detailed.
• The company complies with Secretarial Standards.
• Annual Report on CSR activities is appended as Annexure A, with details of spending by different agencies against CSR projects
• Remuneration paid to directors is in accordance with the Act.
• The company does not have any pending litigations.
• There are no amounts required to be transferred to the Investor Education and Protection Fund.

Annexure A - CSR Report:

• The Company's CSR policy focuses on economic, social and environmental sustainability.
• CSR Committee Composition: Mr. Milind S Thakker (Chairman), Mr. Jasjiv Sahney and Mr. Apparao Mallavarapu, Mr. Udayant Malhoutra (Members).
• CSR information is available on the company website.

Annexure B - Related Party Transactions:

• Details material contracts with related parties (San Motors Limited and San Rolling Stock Services Limited) are provided, including rent for factory shed (Whitefield Road), sale/purchase of materials, commissioning & maintenance service, etc.

Auditor's Report:

• The Independent Auditor's Report expresses an unmodified opinion on the financial statements.
• The report details the responsibilities of management and auditors, the basis for the opinion, and the auditor's report on other legal and regulatory requirements.
• Internal Financial controls over financial reporting were operating effectively as at March 31, 2024. The full audited financial statements and related notes, along with detailed annexures, provide further financial information and support for the items summarized above.