1. General information of the company-
Machino Plastic Limited is a public limited company incorporated as on 02nd April, 1986 under the erstwhile Companies Act, 1956 in India, having its registered office at Plot No 3, Maruti Joint Venture Complex, Gurgaon, Haryana - 122015. The company is a joint venture of Maruti Suzuki India Ltd and Suzuki Motor Corporation, Japan for the manufacture of injection moulded automotive i.e. bumpers, instrument panels, grills etc as original equipment and for spare parts market primarily for Maruti Suzuki India Limited. The company also manufactures various automotive components for others manufacturers.
Note Rights, preference and restrictions attached to equity shares
1.1 The Company has one class of equity share having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held with a right to receive per share dividend declared by the company
In the event of liquidation of the company, the holders of equity share shall be entitled to receive all of the remaining assets of the company, after distribution of all preferential amounts, if any. Such amount will be in the proportion to the number of equity shares held by stockholders.
Notes
Secured term loans from banks & others
a. Term loans are secured by way of pari passu first charge on company's fixed assets excluding tools & dies, both present & future and second charge on current assets
b. The term loan taken from Yes Bank is Rs 70,833,333 (Previous year Rs 120,833,333) which carries interest of 9.80% per annum
c. The term loan taken from Yes Bank is Rs 139,090,909 (Previous year Rs 170,000,000) which carries interest of 9.85% per annum
d. The term loan taken from Kotak Mahindra Bank Limited is Rs 76,964,875 (Previous year Rs 98,954,839) which carries interest of 9.55% per annum
e. The term loan taken from HDFC Bank Limited is Rs 76,388,889 (Previous year Rs 93,055,556) which carries interest of 9.65% per annum
f. The term loan taken from Yes Bank is Rs 74,988,559 (Previous year Nil) which carries interest of 9.95% per annum
g. The term loan taken from Yes Bank is Rs 55,000,000 (Previous year Nil) which carries interest of 10.25% per annum
h. The term loan taken from TATA Capital Financial Services Limited is Rs. 83,336,000 (Previous year Rs 100,000,000) which carries interest of 10.75% per annum
i. The term loan taken from TATA Capital Financial Services Limited is Rs. 9,204,449 (Previous year Rs 23,011,997) which carries interest of 10.80% per annum
Notes Nature of securities
The cash credit facilities are secured by way of pari passu first charge on entire current assets of the Company including stocks of raw material, goods in transit and book debts along with second pari passu charge on entire fixed assets of the Company is excluding moulds and dies, Gurgaon and Manesar Plants.
* Cash credit facilities outstanding from Allahabad Bank is Rs. 9,145,752 (Previous year Rs. 1,034,473) carry interest of 12.20% computed on the daily basis on the actual amount utilized, and are repayable on demand.
* Cash credit facilities outstanding from Axis Bank Limited is Rs. 220,171,358 (Previous year Rs. 27,620,927) carry interest of 9.80% computed on the daily basis on the actual amount utilized, and are repayable on demand.
* Cash credit facilities outstanding from Kotak Mahindra Bank Limited is Rs. 44,699,614 (Previous year Nil) carry interest of 9.25% computed on the daily basis on the actual amount utilized, and are repayable on demand.
* Cash credit facilities outstanding from Yes Bank Limited is Rs. 233,271,771 (Previous year Rs 368,916,429) carry interest of 9.95% computed on the daily basis on the actual amount utilized, and are repayable on demand.
* Cash credit facilities outstanding from HDFC Bank Limited is Rs 2,862,366 (Previous year Nil) carry interest of 9.75% computed on the daily basis on the actual amount utilized, and are repayable on demand.
* Working capital demand loan outstanding from Yes Bank Limited is Rs 50,000,000 (Previous year Nil) carry interest of 9.35% computed on the daily basis on the actual amount utilized, and are repayable on demand.
Note:
The Government of India has implemented Goods and Services Tax (“GST”) from 01st July, 2017 replacing Excise Duty, Service Tax and various other indirect taxes. Until 30 June 2017, 'Sale of products' includes the amount of excise duty recovered on sales amounting to Rs 119,309,351. The Company collects GST on behalf of the Government and is not included in 'Sale of products', and therefore revenue from 'Sale of products' for the year ended 31 March 2019 is not comparable with that of the previous year. 'Sale of products' net of excise duty for the year ended 31 March 2018 is Rs 3,059,432,465.
2. contingent liabilities and commitments (to the extent not provided for):
(i) Contingent liabilities not provided for
a) Demand under the Central Excise Act of Rs. 58,211,882 (Previous year Rs. 111,535,494)
b) Demand under the Sales Tax Act of Rs. 621,691 (Previous year Rs. 621,691).
c) Bill discounted of Rs. Nil (Previous year Rs. 16,707,311)
(ii) Commitments
Estimated amount of contracts, remaining to be executed on capital account (net of advances) Rs. 20,393,000 (Previous year Rs. 121,827,656).
3. (i) Contribution to defined benefit plan
The company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with “Life insurance corporation” in the form of a qualifying insurance policy.
4. Other income includes interest income Rs. 331,776 (Previous year Rs. 310,934), tax deducted thereon is Nil (Previous year Rs. 393), Profit on sale of fixed assets Rs. 660,387 (Previous year Rs. 2,103,700), Sundry creditors written off Rs. 2,177,183 (Previous year Rs. 661), Duty draw back received Rs 315,447 (Previous year Rs. 246,570), Reversal of impairment of assets Rs 1,469,504 (Previous year Nil).
5. Investment in equity share are measured at fair value through other comprehensive income as per ind AS 109.
The company had made Investment of Face Value of Rs.12,500,000 in equity shares of Caparo Maruti Limited. The investee company has disputed the shareholding of the Company. The company has filed a petition to Hon'ble Company Law Board, who gave company an option to sell shares to majority shareholders after valuation to make an exit. The Company filed an appeal in the Hon'ble Delhi High Court which dismissing company's appeal upheld Company Law Board order thereafter SLPs were preferred against the orders of the Hon'ble High Court of Delhi before the Hon'ble Supreme Court of India by both the parties. The Hon'ble Supreme Court of India vide its order dated 29th March 2016 dismissed both SLPs. However, it states that the order of dismissal is subject to the result of such case(s) as may be pending between the paties in respect of cancellation of the shares held by the petitioner. The matter is still sub-judice.
In the current circumstances, the company is unable to ascertain the fair value of investment in equity share in Caparo Maruti Limited as it is not practicably feasible to do so. Consequently, no fair value adjustment has been made in the books of accounts and these equity instruments have been carrying forward at cost as at Balance sheet date
6. The company is exclusively engaged in the business of manufacturing plastic moulded parts for automotive, appliances and industrial application and allied products, which is considered as the only reportable segment referred to in statement on Ind AS-108 “Operating Segments”. The geographical segmentation is not relevant, as there is insignificant export.
7. Information as required by ind AS 24“Related Parties Disclosures” as follows:
List of related parties:
a. Associate companies
Maruti Suzuki India Limited
Suzuki Motor Corporation, Japan
b. Enterprises under common control
Suzuki Motor Gujarat Private Limited
Suzuki Motorcycle India Private Limited
c. Enterprises over which key management personnel
And their close members are able to exercise significant influence
Machino Motors Private Limited
Machino Techno Sales Limited
Machino Transport Private Limited
Machino Finance Private Limited
Machino Media Private Limited
Machino Auto Comp Tooling Private Limited
Machino Polymers Limited
Rajiv Exports Industries Private Limited
Grandmaastters Mold Limited
Pranaa Plastics Limited
d. Key management personnel & their close members
Mr M.D. Jindal - Chairman Emeritus (Expired on 13th January 2019)
Mr Sanjiivv Jindall - Chairman cum Managing Director & Son of Chairman Emeritus
Machino Plastics Limited
Notes to the financial statements for the year ended 31 March 2019
(All amount in Rupees, unless otherwise stated)
Ms Kamla Jindal - Spouse of Chairman Emeritus (Expired on 21st November 2018)
Ms Sarita Jindal - Spouse of Managing Director cum Chairman
Mr Aditya Jindal - Executive Director & Son of Chairman cum Managing Director
Mr Surya Kant Agrawal - General Manager cum Company Secretary
The Company manages its capital to ensure that the company will be able to continue as going concerns while maximizing the return to stakeholders through the optimization of the debt and equity balance.
The capital structure of the Company consists of net debt (borrowings as detailed in notes 16 and 19 offset by cash and bank balances) and total equity of the company. The company is not subject to any externally imposed capital requirements.
The Company's risk management committee reviews the capital structure of the Company on a semi-annual basis. As part of this review, the committee considers the cost of capital and the risks associated with each class of capital. The Company monitors capital on the basis of following gearing ratio, which is net debt divided by total equity plus debt.
The Company's Corporate Treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the company through internal risk reports which analyses exposures by degree and magnitude of risks. These risks include market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
The Corporate Treasury function reports quarterly to the company's risk management committee, an Independent body that monitors risks and policies implemented to mitigate risk exposures.
Market Risk
The company's activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates.
a) Foreign currency risk management
The company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters
The carrying amounts of the company's foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are as follows.
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The company is exposed to interest rate risk because company borrows funds at both fixed and floating interest rates. The risk is managed by the company by maintaining an appropriate mix between fixed and variable rate borrowings.
Interest rate sensitivity analysis
The sensitivity analyses below have been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management's assessment of the reasonably possible change in interest rates.
(i) The exposure of group borrowings to interest rate changes at the end of reporting period are as follows:
(ii) As at the end of reporting period, the company had the following variable rate borrowings:
c) credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The company only transacts with entities that are rated the equivalent of investment grade and above. This information is supplied by independent rating agencies where available and, if not available, the company uses other publicly available financial information and its own trading records to rate its major customers. The company's exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that are reviewed and approved by the risk management committee annually.
d) Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the company's short-term, medium-term and long-term funding and liquidity management requirements. The company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
Liquidity and interest risk tables
The following tables detail the Company's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the company can be required to pay.
The tables include both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period.
The contractual maturity is based on the earliest date on which the company may be required to pay.
8. Fair value of measurement
Fair value of the company's financial assets and financial liabilities that are measured at fair value on a recurring basis.
9. The group offsets a financial asset and a financial liability when it currently has a legally enforceable right to set off the recognized amounts and the group intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
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