Rane : Annual Report 2020-2021

Rane Holdings Limited

85th Annual Report 2020-21

READ INSIDE

Company Overview
Financial Highlights...............................................................	1
Chairman Massage................................................................	2
Corporate Information..........................................................	3
Notice.....................................................................................	4
Management Reports
Report of the Board of Directors.......................................	15
Management Discussion and Analysis.............................	23
Corporate Governance Report..........................................	42
Standalone Financial Statements
Independent Auditor's Report ..........................................	67
Balance Sheet......................................................................	74
Statement of Profit and Loss..............................................	75
Statement of Changes in Equity........................................	76
Cash Flow Statement..........................................................	77
Notes.....................................................................................	78
Consolidated Financial Statements
Independent Auditor's Report ........................................	118
Balance Sheet....................................................................	126
Statement of Profit and Loss............................................	127
Statement of Changes in Equity......................................	128
Cash Flow Statement........................................................	130
Notes...................................................................................	132

Corporate Overview

Management Reports

Financial Statements

FINANCIAL HIGHLIGHTS - STANDALONE

OPERATIONAL PERFORMANCE

(` in Crores)

FINANCIAL YEAR	FY 21		FY 20		FY 19		FY 18		FY 17		FY 16		FY 15		FY 14		FY 13		FY 12
Total Income	65.99		97.78	128.49	97.09	98.81	75.85	59.94	53.50	57.73	63.91
Earnings Before Interest, Tax,	21.13		62.42	90.96	62.40	66.95	46.29	33.99	29.16	34.49	41.05
Depreciation & Amortisation (EBITDA)*
Profit BeforeTax (PBT)*	14.98		57.04	87.49	58.79	62.76	42.90	32.68	27.95	32.53	38.11
Profit After Tax (PAT)	1.36		50.82	76.36	48.79	49.80	35.65	25.92	21.73	25.95	34.25

KEY PERFORMANCE INDICATORS

FINANCIAL YEAR		FY 21		FY 20		FY 19		FY 18		FY 17		FY 16		FY 15		FY 14		FY 13		FY 12
Return on Capital Employed (ROCE) %	3.46	12.56	21.24	15.77	18.79	14.70	11.81	10.60	12.97	15.89
Return on Net Worth (RONW) %	0.29	11.41	19.13	13.34	15.20	12.17	9.38	8.24	10.32	14.54
Earnings Per Share (`)	0.95	35.59	53.48	34.17	34.88	24.97	18.16	15.22	18.17	23.99
Dividend (%) (@)	-	80	190	145	85	100	75	65	80	100
Dividend Payout ratio (#)	-	25	49	51	29	48	50	50	51	48
Book Value Per Share (`)	328.17	321.84	301.87	257.33	244.98	212.14	198.25	188.75	180.81	171.50

BALANCE SHEET HIGHLIGHTS**

(` in Crores)

FINANCIAL YEAR		FY 21		FY 20		FY 19		FY 18		FY 17		FY 16		FY 15		FY 14		FY 13		FY 12
Equity Share Capital		14.28		14.28		14.28		14.28		14.28		14.28		14.28		14.28		14.28		14.28
Shareholders' funds		468.56		459.52		431.01		381.69		349.77		302.90		283.06		269.49		258.16		244.87
Non current Liabilities		72.82		23.41		13.99		19.15		8.45		22.40		0.64		0.84		2.65		4.11
Current Liabilities		20.46		19.43		16.34		16.45		13.67		12.23		18.47		16.93		14.25		22.06
Non current assets		538.84		483.22		445.00		394.38		306.38		320.74		280.92		273.17		267.38		264.33
Current assets	23.00	19.14	16.34	22.91	65.51	16.78	21.25	14.09	7.68	6.71

* EBITDA & PBT arrived after considering exceptional item.

1. Includes final / interim dividend, if any, recommended by the Board for the respective financial years. (#)Dividend payout is calculated on profits excluding one off & exceptional income, if any.

** based on revised Schedule VI to Companies Act, 1956/ Schedule III to Companies Act, 2013 as applicable.

Note :

1. Figures for FY 17 onwards are as per Indian Accounting Standards (Ind AS) prescribed under the Companies Act, 2013. Hence these figures are not comparable with the corresponding figures reported for the previous years.

RANE GROUP AGGREGATE

(` in Crores)

FINANCIAL YEAR		FY 21		FY 20		FY 19		FY 18		FY 17
Total Income*		4,140.37		4,436.85		5,369.41		4,792.71		4,070.83
EBITDA#		145.07		244.65		552.26		600.19		533.78
PBT#		(113.60)		(32.79)		288.76		355.00		306.31
PAT		(96.68)		(28.31)		178.56		230.49		211.67
EPS** (`)		(35.42)		(1.90)		72.65		91.26		93.41
Net Worth	1,082.17	1,149.43	1,275.14	1,185.76	963.95

1. Total Income are net of excise duty wherever applicable.
   (#) EBITDA & PBT arrived after considering exceptional item. (**) Basic EPS for RHL on Consolidated basis.

Annual Report 2020-21

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Rane Holdings Limited

From the Desk of the Chairman

Dear Stakeholders,

As I write this note, India is just coming out of the second wave of Coronavirus (COVID-19) pandemic, which was much more severe than the first wave we saw last year. I hope we now prepare ourselves better for any future wave and see an economic recovery soon.

FY21 was a challenging year with the COVID-19 pandemic impacting the lives and livelihood of people across the globe. After the lockdown in the first quarter, the recovery in the demand environment was better than anticipated helping to partially mitigate the financial impact.

The global economy declined by 3.5% in 2020 due to COVID-19 outbreak. The Indian GDP growth is estimated to have declined by 7.5% in FY21. The fiscal support by various governments and liquidity infusion helped stronger recovery in demand preventing full blown recession.

Dealing with the pandemic

As we restarted our operations post lockdown in the first quarter of FY21, the group quickly implemented the requirements for physical distancing, sanitization and wearing masks across our plants and offices to ensure safety of our employees. Customer engagement, as well as internal interactions, were conducted leveraging the technologies for virtual meetings. Across the board, significant cost reduction projects were implemented to align the cost to the lower volumes.

Group Performance

The group aggregate Total Revenue declined 6.7% to `4,140.4 crore and EBITDA margin dropped 67 bps to 7.24%. The Group companies continued to engage in various operational improvement projects on productivity and to save costs on material procurement, power, etc.

We continued to focus on new business development initiatives during this period. I now turn to specific challenges we continued to face during the year.

The performance of Rane Light Metal Castings America (RLMCA) was affected significantly due to volume drop of existing products and delay in launch of new businesses due to COVID-19. The operational performance of the business has improved with the introduction of TQM practices. This was evident from the significant reduction in expedited freight cost, repairs, maintenance cost, consumable, tooling cost and the cost of poor quality. Rane (Madras) Limited Board is closely reviewing the performance of the business, considering the operational improvements, order book position and long-term potential.

Rane Engine Valve Limited turnaround plan is taking longer than anticipated due to drastic drop in volumes. The management team reduced the breakeven sales through operational improvement and cost reduction measures. We have also enhanced the order book position particularly non-automotive business.

Rane NSK Steering Systems Private Limited made further warranty provisions based on the continued claims in FY21. We are confident that the countermeasure has adequately addressed the root cause. We hope to see some stabilization in this warranty issue in the current year.

Rane Brake Lining Limited and Rane TRW Steering Systems Private Limited continued to strengthen their market position and performed well.

CSR

Rane's major CSR projects of Polytechnic college and CBSE School near Trichy adopted online model and successfully completed the Academic year 2020-21. Both the institutions continue to do well in terms of student engagement with the virtual delivery model even during pandemic times.

Looking forward

We remain optimistic about the demand recovery in FY22. However, the risk of any further pandemic waves and resultant lockdown could derail the growth.

An excellent, dedicated and professional team of employees continue to drive the company's efforts on enhancing our market position and improving the operational and financial performance in these challenging times.

On behalf of the entire Board of Rane Holdings Limited, I would like to thank all our Stakeholders - Customers, Employees, Vendors, Investors, Bankers, Government and most importantly our shareholders, who have conferred immense confidence in us, throughout this long journey.

Yours Sincerely,

L Ganesh

Chairman

2 Annual Report 2020-21

Corporate Overview

Management Reports

Financial Statements

Rane Holdings Limited

Board of Directors	Listing of Shares on
L Ganesh,	BSE Limited, Mumbai
Chairman & Managing Director	National Stock Exchange of India Limited, Mumbai
Harish Lakshman,
Vice Chairman & Joint Managing Director	Statutory Auditors
Pradip Kumar Bishnoi	M/s. B S R & Co. LLP
Rajeev Gupta	Chartered Accountants,
Dr. Sheela Bhide	KRM Tower, First & Second Floor,
Dr. V Sumantran	No.1, Harrington Road,
	Chetpet, Chennai - 600 031
Chairman Emeritus
L Lakshman	Secretarial Auditors
	M/s. S Krishnamurthy & Co.,
Audit Committee	Company Secretaries,
Dr. V Sumantran, Chairman	"Sreshtam", Old No.17, New No.16,
L Ganesh	Pattammal Street, Mandaveli,
Rajeev Gupta	Chennai - 600 028.
Dr. Sheela Bhide
	Bankers
Stakeholders Relationship Committee	HDFC Bank Limited, Chennai - 600 004
Dr. Sheela Bhide, Chairman	Indian Bank, Chennai - 600 006
Harish Lakshman	Federal Bank Ltd, Chennai 600 002
L Ganesh
	Registered Office
Nomination and Remuneration Committee	Rane Holdings Limited
Dr. V Sumantran, Chairman	CIN: L35999TN1936PLC002202
Pradip Kumar Bishnoi	"MAITHRI", 132, Cathedral Road
Dr. Sheela Bhide	Chennai 600 086
	Phone : [phone]
Corporate Social Responsibility Committee	Email : [e-mail]
L Ganesh, Chairman	Website : www.ranegroup.com
Harish Lakshman
Dr. Sheela Bhide	Registrar and Transfer Agent
	Integrated Registry Management Services Private Limited
Risk Management Committee	"Kences Towers", 2nd Floor, No.1 Ramakrishna Street
L Ganesh, Chairman	North Usman Road, T.Nagar, Chennai - 600 017
Harish Lakshman	Ph : [phone]; Fax : [phone]
Dr. V Sumantran	E-mail : [e-mail]
P A Padmanabhan, President- Finance	Website : www.integratedindia.in
President - Corporate Services
R Venkatanarayanan
President - Finance and Group CFO
P A Padmanabhan
Executive Vice President - Secretarial & Legal and
Company Secretary
Siva Chandrasekaran
Vice President - Finance & CFO
J Ananth

Annual Report 2020-21

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