Dear Shareholder,
Your Directors have pleasure in presenting the 31st Annual Report of your
Company together with the Audited Financial Statements for the year ended 31st
March 2025.
FINANCIAL RESULTS
The Financial Performance of your Company for the year ended 31st March 2025
is summarized below :
|
Year Ended 31.03.2025 |
Year Ended 31.03.2024 |
|
Rs. in Lakhs |
Rs. in Lakhs |
| Net sales |
8144.18 |
8382.74 |
| Other Income |
86.92 |
104.73 |
| Total (A) |
8231.10 |
8487.47 |
| Total Expenditure |
7772.72 |
7974.78 |
| Profit before interest & depreciation |
458.38 |
512.69 |
| Interest & financial charges |
14.08 |
18.42 |
| Depreciation & amortization expense |
67.51 |
78.44 |
| Profit before tax |
376.79 |
415.83 |
| Tax expense |
103.03 |
95.44 |
| Net profit / loss for the period |
273.76 |
320.40 |
| Other Comprehensive Income (net of tax) |
-5.89 |
-3.81 |
| Total Comprehensive Income for the period |
267.87 |
316.59 |
| Surplus brought forward |
1614.74 |
1298.15 |
| Balance carried to Balance sheet |
1882.61 |
1614.74 |
DIVIDEND AND TRANSFER TO RESERVES
Your Board of Directors have not recommended any dividend for the year ended 31st
March 2025 (previous year dividend declared Rs. nil), keeping in view the requirements of
the Company for enhanced working capital for the regular business.
Your Directors have not transferred any amount to the any Reserves out of the profits
made during the year.
MANAGEMENT DISCUSSION AND ANALYSIS
A. Industry structure and developments
Your Company is a Small Scale industries registered under MSME category. Your Company
is having manufacturing plants for the manufacture of Arc Welding Electrodes, Copper
Coated Mild Steel (CCMS) Wire and Drawn Wire used for the purpose of welding by the
Engineering and Fabrication industries. Your Company trades by importing rutile and Flux
on a regular basis. The demand for Company's products depends upon the robustness of
demand in the engineering and capital goods industries in the Country.
B. Financial Performance In Relation to Operational Performance
During the year ended 31st March 2025 the overall turnover of the Company
was Rs.8144.18 lakhs as against Rs 8382.74 lakhs achieved during the last year resulting
marginal decrease in Turnover to the extent of 2.84% compared to 4.22% decrease in
turnover during the previous year. The production of welding electrodes was 1951.214 MTs
as against 1921.047 MTs achieved during the previous year. The production of CCMS
Wire during the year ended 31st March 2025 was 4684.748 MTs as against
4277.059 MTs during the previous year. The production of Wire rod to the extent of
2339.304 MTs was also done during the year (previous year 2339.601 MTs).
During the year ended 31st March 2025 the profit before tax was Rs 376.79
lakhs (previous year Rs 415.83 lakhs) and after making a provision for tax amounting to Rs
103.03 lakhs (previous year Rs 95.43 lakhs) (including provision for deferred tax), the
profit after tax was Rs 273.76 lakhs (previous year Rs 320.40 lakhs). The Profit after tax
has decreased by 14.55% during the year ended 31st March 2025 when compared to
6.58% year on year increase during the previous year. The Financial Statements of the
Company has been prepared in accordance with the requirements of Companies (Indian
Accounting Standards) Rules, 2015.
During the Financial year 2024-25, the operations of the Company was affected to a
marginal extent. The overall turnover of the Company decreased marginally by 2.84%. The
decrease in turnover was due to continuing correction in the basic raw material i.e. steel
rods due to cyclical factors. The raw material component in the total cost of production
constitutes about 95% and hence, the turnover has the tendency to increase or reduce as
per varying in steel prices. The Company was successful in maintaining and protecting its
net margin.
The certificate issued by TUV India certifying the QMS as conforming to Quality
Management System (QMS) Standard ISO 9001 for its manufacturing facility at Redhills,
Chennai, remains valid. The Research Designs & Standards Organisation (RDSO) has also
approved the Company's products and this approval by RDSO has enabled the Company to
supply its products to Indian Railways and ICF. The Company has also obtained BIS Trade
Mark for CCMS Wire. All these approvals makes the products of the Company eligible for
participation in tenders from the respective manufacturing industries; be it in PSUs or
Private sector thus widening the market reach for the Company's bouquet of products in the
welding electrodes segment.
As regards the business relating to Trading in Groceries, Staples and other similar
branded products, the Company is yet to scale up the business to commercial significance.
The Company has made turnover of Rs.131.30 lakhs with regard to this business during the
year ended 31 st March 2025, constituting about 1.61% of the total turnover of the
Company.
C. Segmentwise performance
Your company operates in the single segment i.e., manufacture and marketing of welding
electrodes and as such the discussion of segment- wise performance is not applicable.
D. Risks & Concerns
Your Company is using base metals as its main raw materials which is subjected to wild
price fluctuations and availability. This imparts uncertainty in margin realization on an
uniform basis commensurate to increase in turnover. Besides, the Company has to lift its
materials upon payment of full consideration as advance payment which also results in
increased working capital requirements.
E. Opportunities and Threats
The demand for the products of your Company during the year 2024-25 remained fairly
robust even though prices are showing declining trend which reflects the contraction of
demand in the engineering goods manufacturing sector in the economy.
The industrial development scenario in the State of Tamilnadu is quite impressive. The
geo-strategic developments that are taking place resulting in shift in production base of
a variety of engineering and fabrication products to our regions considered favourable
development for the Company and the Company is fully geared to take advantage of the
developments.
The emerging geo-political threats regarding trade flows and product dumping by
overseas players in the domestic market needs to be vigilantly guarded by the Government
of India which will have to initiate appropriate measures to protect the domestic
industries especially in the MSME sector. The risk of geo-political conflicts may result
in destabilizing effects on domestic industries.
Your Company is well positioned with adequate competencies in all core skills to ride
the emerging threats and opportunities and convert them for the commercial benefit of your
Company.
F. Prospects and Outlook
In line with the industry trends, your Company's production preference has shifted
towards producing more of CCMS Wire products and restricting production of Arc Welding
Electrodes which is reflected the productions numbers outlined above. Your Company has
adequate capacity of CCMS welding wire products to cater to the changed market
requirements. The Company has not increased its installed capacity during the year.
Your Company was able to nurture and maintain its brand image and preference among
industrial users and is constantly striving to aggressively promoting the same for gaining
unconventional market share.
G. Internal control systems
Your company has a proper and adequate system of internal controls to ensure that all
assets are safeguarded and protected against loss from unauthorised use or disposition.
H. Human resources and industrial relations
Your Company has well qualified and experienced technical, financial and administrative
staff to cater to its business requirements. The relations with the employees of the
company remained cordial throughout the year.
I. Significant changes in Key Financial Ratios
The Key Financial Ratios applicable to the operations of the Company and changes
thereon along with the explanation is furnished Note 23 annexed to the Financial
Statements.
Disclosure of Accounting Treatment
The Company has not made any alternative treatment which is in variance with the Indian
Accounting Standard. The treatment of various financial items vis-a-vis the prescribed
accounting standard is disclosed Note 1,23-25, 26, annexed to Financial Statements which
is self explanatory.
CREDIT RATING
The Company has been rated by ICRA for the outstanding for debt instruments /
facilities. The ratings accorded by ICRA valid as on 31st March 2025 are as
follows:
| Instrument |
Rated Amount (Rs. Crore) |
Ratings |
| Fund Based Limits - Cash Credit |
10 |
[ICRA]BB+;(Stable) |
| Non-fund Based Limits - Interchageable : |
|
|
| Bank Guarantee |
(2) |
[ICRA]BB+;(Stable) |
| Letter of credit |
(3) |
[ICRA]A4+ |
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
Your Company does not have any subsidiary, joint venture or associate companies.
DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors state that:
i. in the preparation of the annual accounts for the year ended March 31, 2025, the
applicable accounting standards read with requirements set out under Schedule III to the
Act, have been followed and there are no material departures from the same;
ii. the Directors have selected such accounting policies and applied them consistently
and made judgements and estimates that are reasonable and prudent so as to give a true and
fair view of the state of affairs of the Company as at March 31,2025 and of the profit of
the Company for the year ended on that date;
iii. 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;
iv. the Directors have prepared the annual accounts on a ‘going concern' basis;
v. the Directors 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. the Directors have devised proper systems to ensure compliance with the provisions
of all applicable laws and that such systems are adequate and operating effectively.
CORPORATE GOVERNANCE
Your Company has complied with all the material requirements of Corporate Governance
prescribed under Securities & Exchange Board of India (Listing Obligation and
Disclosure Requirements) Regulations, 2015. A report on Corpo-rate Governance as required
under regulation 34(3) read along with Schedule V of the said regulation is annexed and it
forms part of this report.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
The Related Party Transactions which was considered material as per the policy adopted
by the Company and for which the Company has already obtained the members approval at the
previous AGM is disclosed in the Form AOC2 annexed to this report. Other than this, the
Company had not entered into any contract, arrangement or transaction with related parties
which could be considered material in accordance with the policy of the Company on
materiality of related party transactions.
The Policy on materiality of related party transactions and dealing with related party
transactions as approved by the Board was put up on the website of the Company at www.rasielectrodes.com
and it is also furnished in the Corporate Governance Report.
Your Directors also draw attention of the members to Note 26.4 to the financial
statement which sets out related party disclosures.
RISK MANAGEMENT
Your Company has adequate risk management infrastructure in place capable of addressing
risks faced by the company both internal and external. Your Company is not required to
constitute a separate Risk Management Committee.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to
financial statements. During the year, no reportable material weakness have surfaced with
regard to those internal controls in place.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board of Directors of the Company is duly constituted as per the requirements of
section 149 of the Companies Act, 2013, and SEBI (LODR) Regulations, 2015.
The Independent Directors Mr Suresh Kumar Mehta and Ms Kavita Patel have been
re-appointed by the shareholders for an initial period of five years from 14th
August 2023 to 13th August 2028 by passing a special resolution at their 29th
AGM held on 29.09.2023. The Shareholders have, vide the special resolution passed by
Postal Ballot and Electronic Voting on 11th May 2024, re-appointed Mrs Aashika
Kumari as an I ndependent Director for the 2nd Term to hold office from 30th
May 2024 to 29th May 2029.
There were no other changes during the year in the overall composition of the Board of
Directors of the Company.
Your Non-Independent Director Mr RANJIT KUMAR KOTHARI, retires by rotation at the
ensuing Annual General meeting and being eligible is offering himself for re-appointment.
The Company has in place all the KMPs required to be appointed u/s 203 of the Companies
Act, 2013.
Mr B Popatlal Kothari is the Managing Director & Chief Executive Officer of the
Company. His ap re-appointment and remuneration payable to him for a further period of
three years from 13th February 2024 to 12th February 2027, was
approved by the members vide special resolution passed through Postal Ballot and
Electronic Voting on 11th May 2024.
Mr Kashyap Kothari is the Chief Financial Officer and Mrs Jagruti J Jain is the Company
Secretary.
The Company has received declarations from all the Independent Directors of the Company
confirming that they meet the criteria of independence as prescribed both under the
Companies Act, 2013 and SEBI (LODR) Regulations, 2015.
A familiarisation program was conducted on 13th February 2025 for the I
ndependent Directors wherein the roles, rights, responsibilities of the Independent
Directors, the business model of the company and the industry related developments was
apprised and presented to them. All the Directors attended the Familiarisation programme.
The details of the familiarization program conducted for Independent Directors has also
been uploaded at the website of the Company at www.rasielectrodes.com ,
The Company has formulated Policy for selection of Directors and determining Directors
independence, Remuneration Policy for Directors, Key Managerial Personnel and other
employees which has been put up on the website of the Company at www. rasielectrodes.
com.
EMPLOYEES STOCK OPTION SCHEME
The Company has not formulated any Employees Stock Option scheme.
AUDITORS & AUDITORS REPORT Statutory Audit
The report of the Statutory Auditors M/s POONAM ANKIT & ASSOCIATES., Chartered
Accountants, Chennai, is annexed to this report.
The Auditors have issued an un-modified opinion on the Financial Statements audited by
them for the financial year ended 31st March 2025. Secretarial Audit
The Board has appointed Mr Gopikrishnan Madanagopal, Practicing Company Secretary, to
conduct Secretarial Audit (SA) for the financial year 2024-25. The Secretarial Audit
Report for the financial year ended March 31,2025 is annexed to this report.
As regards the remarks made by the Secretarial Auditor in para 4 of the SA Report for
the year ended 31st March 2025, your Board would like to furnish the following
explanation:
Pursuant to action taken by BSE Ltd in levying a fine under Regulation 34(1) of the
Listing Regulation regarding the alleged nonsubmission of the 30th Annual
Report 2024, the Company has clarified to the Exchange its due compliance with Regulation
34(1) within the prescribed timeline and also made an appeal requesting for full waiver of
penalty levied. The obsevations made in the Secretarial Audit Report is self explanatory,
and it explains the valid grounds on which its appeal has been made to the Exchange.
Other than the above, the Secretarial Auditor has issued an un-modified opinion in his
report for the year ended 31 st March 2025.
Cost Audit
The provisions of section 148 of the Companies Act, 2013, is not applicable to the
Company since the Company is not carrying on any activities specified under Table A or
Table B of the Companies (Cost Record & Audit) Rules, 2014.
Internal Audit
Mr G Mahavirchand Kochar, Independent Practicing Chartered Accountant is the Internal
Auditor of the Company as required under section 138 of the Companies Act, 2013. The
Internal Auditor reports to the Audit Committee and the periodical reports submitted by
him are reviewed by the Audit Committee and the Board. No adverse findings were reported
by the Internal Auditor during the year.
DISCLOSURES
Corporate Social Responsibility (CSR)
Your Company is not falling within the financial criteria laid down under section
135(1) of the Companies Act, 2013, and as such is not under obligation constitute
Corporate Social Responsibility committee and undertake CSR activities.
Audit committee
The Audit Committee comprises of two Independent Director and one Non-Independent
Director and as such the composition requirements prescribed under section 177 of the
Companies Act, 2013 and the SEBI (LODR) Regulations is satisfied. All the recommendations
made by the Audit Committee during the year have been accepted by the Board.
Vigil Mechanism
The Company has put in place a vigil mechanism in order to facilitate Directors and
Employees to report on genuine concerns. The Whistle Blower policy adopted by the Company
and the Vigil Mechanism as a part of the said policy has been put up on the website of the
Company at www.rasielectrodes.com.
Meetings of Board
During the year FIVE meetings of the Board of Directors were held. The dates on which
the Board meetings were held and the attendance of the Directors therein is furnished in
the Corporate Governance Report.
Particulars of Loans given, Investments made, Guarantees given and securities provided.
The Company has duly complied with the requirements of Companies Act, 2013, with
respect to loans given and investments made during the financial year.
The particulars of Loans given, investments made and the purpose for which the loan
given is proposed to be utilized by the recipient is furnished in Note:26.5 to the
financial statements.
The Company has not given any guarantees and has not provided any security during the
year.
Conservation of energy, technology absorption, foreign exchange earnings and outgo.
As required under the Provisions of Sec. 134(3)(m) of the Companies Act 2013,
information relating to Conservation of energy, technology absorption, and foreign
exchange earnings and outgo is annexed to this report.
Extract of Annual Return
The Annual Return as on 31st March 2025 in the prescribed E-Form MGT7 is
available at the following weblink :
http://cmsbox.rasielectrodes.com/pdffiles/DRAFT%20FMGT72025%20ANNUAL%20RETURN%20F.pdf
Particulars of Employees and related disclosures
In terms of the requirements of Section 197 (12) of the Companies Act, 2013, read with
Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, your Directors wish to state that none of the employees are
drawing remuneration in excess of the limits set out in the said rules.
Disclosures pertaining to remuneration and other details as required under Section
197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, is annexed to this report.
Employees Stock Option Scheme
The Company has not formulated any Employees Stock Option scheme.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
The Company has in place Anti Sexual Harassment Policy in line with the requirements of
the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013. All employees (permanent, contractual, temporary, trainees) are covered under this
policy. The Company has not received any complaints under the said Act during the year.
General
Your Directors do not have anything to report or disclose on the following items since
there were no transaction relating to them during the year:
i. No deposits were accepted attracting the provisions of section 73 - 76 of the
Companies Act, 2013.
ii. The Company has not issued any equity shares during the year with differential
rights as to dividend, voting or otherwise.
iii. The Company has not issued any shares (including sweat equity shares) to any of
its employees during the year.
iv. The Company does not have any subsidiary, Joint venture or associate companies and
as such the Managing Director / Whole time Directors receiving any remuneration from such
companies does not arise.
v. No significant or material orders were passed by the Regulators or Courts or T
ribunals which impact the going concern status and Company's operations in future.
vi. There were no material changes and commitments affecting the financial position of
the company which have occurred between 31st March 2025 and the date of this
report.
vii. The Board has reviewed the system in place to monitor compliance with all the
applicable laws relating to Companies domain of operation and it has not come across any
material non-compliance with such laws during the year.
viii. The Company has not made any application and there are no proceedings pending
under the Insolvency and Bankruptcy Code, 2016, during the year or as at the end of the
year.
ix. The Company has not done any valuation or availed any one time settlement of loans
from Banks or Financial Institutions during the year.
ACKNOWLEDGEMENT
Your Directors take this opportunity to thank the various Governmental authorities, the
Company's Bankers M/s. Bank of Baroda (formerly Dena Bank), and Citi Bank.N.A., the
customers, and Suppliers. Your Directors also wish to place on record the dedicated
Services rendered by the employees of the Company at all levels.
| By Order of the Board, |
| For & on behalf of the Board of Directors |
| B RANJIT KUMAR KOTHARI |
| CHAIRMAN |
| DIN:01560805 |
| CHENNAI |
| DATED: 30th MAY 2025 |
|