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Andrew Yule & Company Ltd.

BSE: 526173 Sector: Others
NSE: ANDREWYULE ISIN Code: INE449C01025
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OPEN 22.50
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VOLUME 107223
52-Week high 33.85
52-Week low 18.15
P/E 29.49
Mkt Cap.(Rs cr) 806.41
Buy Price 23.35
Buy Qty 584.00
Sell Price 0.00
Sell Qty 0.00
OPEN 22.50
CLOSE 23.55
VOLUME 107223
52-Week high 33.85
52-Week low 18.15
P/E 29.49
Mkt Cap.(Rs cr) 806.41
Buy Price 23.35
Buy Qty 584.00
Sell Price 0.00
Sell Qty 0.00

Andrew Yule & Company Ltd. (ANDREWYULE) - Director Report

Company director report

Dear Shareholders

Your Directors take pleasure in presenting the 68th Annual Report on the operations ofthe Company together with the AuditorRs s Report and Audited Financial Statements for theyear ended 31st March 2016 :

[01] FINANCIAL RESULTS

The financial results of the Company for the year 2015-16 in comparison with theprevious financial year 2014-15 are highlighted herein below :

[Rs in lakh]

Year ended 31st March 2016 Year ended 31st March 2015
Revenue from operations and other operational
Income 35955.03 35630.51
Other Income 3042.70 4583.20
Total Revenue 38997.73 40213.71
Profit before Tax 927.36 1389.16
Less : Provision for Tax
- Current Tax 114.87 97.04
- Deferred Tax (-) 22.80 (-) 3.94
92.07 93.10
Profit after Tax 835.29 1296.06
Balance brought forward from previous year 786.57 241.39
Transfer to Bond 166.67
Redemption Reserve
Depreciation Adjustment 183.86
Proposed Dividend 333.64
Dividend Distribution Tax 66.71
Balance carried forward to Balance Sheet 1621.86 786.57

[02] FINANCIAL PERFORMANCE

Your Company s results during the year under review have declined as compared to theprevious year. Your Company has recorded revenue from operations and other income of Rs389.98 crore during the financial year 2015-16 as compared to Rs 402.14 crore as recordedin the previous year.

Profit before Tax (PBT) during the financial year 2015-16 stood at Rs 9.27 crore ascompared to Rs 13.89 crore for the previous financial year registering a decrease by33.26%. Profit after Tax (PAT) for the financial year 2015-16 had been Rs 8.35 crore ascompared to Rs 12.96 crore during the previous financial year 2014-15 registering adecrease by 35.57%. Though the other income has been declined during the year 2015-16 byRs 15.41 crore your Company has registered a decline in PBT by only Rs 4.62 crore whichimplies that there has been reduction in operational loss by Rs 10.79 crore.

[03] DIVIDEND

In view of the inadequate net profit for the financial year 2015-16 your Directorsregret their inability to

recommend any dividend on Equity Shares for the year under review.

[04] PROSPECTS / OPERATIONS

[4.1] Tea

[a] North Indian Batting Order (Ranking): Being a prime Quality parameter all Assam& Dooars Gardens are within Top 28 during the year 2015-16. 3 (Three) AYCL gardensfeatured in Top 10 and 2 (Two) AYCL gardens are featured in Top 20. Most of the gardensshowed improvement in the batting order.

[b] Installation of Green Tea manufacturing facility at Mim T.E. in Darjeeling and NewDooars T.E. in North Bengal.

[c] Manufactured Specialty Teas and exported to US and Domestic Markets.

[d] Promotion and sales of Packet Teas through e-commerce TRIFED outlets in GangtokBhopal Delhiand Bengaluru BISWA BANGLA outlets in Kolkata Delhi Darjeeling &Bagdogra Yule Tea Lounge at Eco Park Kolkata

[e] Successful implementation of ISO 220000 of all Dooars Gardens.

[f] Turnover of Tea division of your company has increased from Rs 188.41 crore to Rs212.29 crore during the year. Tea exports during the year was 1.92 lakh kgs with FOB Rs4.49 crore compared to 1.00 lakh kgs with FOB Rs 2.17 crore last year catering to marketsin Georgia Ukraine USA Iran Canada Ireland and Germany.

[g] In view of the huge investments made in gardens by way of uprooting replanting andmodernising the processing facilities the outlook appears promising.

[4.2] Electrical Division

[a] Order booking of your Company has crossed Rs 70.00 crore (Chennai Operations) andRs 100.00 crore (Kolkata Operations) for the financial year 2015-16 and net sales was Rs116.00 crore during the year under review. This is a record high compared to all previousyears.

[b] The Electrical Division also has designed and manufacture the highest rating of 132KV class 63 MVA — Transformers during the current financial year.

[4.3] Engineering Division

[a] Order Booking of your Company was Rs 30.73 crore and net sales was Rs 24.00 croreduring the financial year 2015-16.

[b] Division has recorded All Time High Steel consumption of 867 MT (+65% YOY) in2015-16.

[c] DivisionRs s Capacity utilization also reached All Time High as number ofImpellers produced in-house stands at 305 (+45% YOY).

[d] Productivity increased with system improvement like Rolling weld stand.

[e] New Axial Fan developed with adjustable pitch blade. This has a unique"Laminar high tensile blade" for high efficiency and long life.

[05] BIFR STATUS

The Company ceased to be a Sick Industrial Company within the meaning of Section 3(1)(o) of SICA as its net worth had turned positive.

[06] MANAGEMENT DISCUSSION & ANALYSIS REPORT

Management Discussion & Analysis Report for the year under review as stipulatedunder the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 ispresented in a separate section forming part of the BoardRs s Report as Annexure I.

[07] CORPORATE GOVERNANCE

The report on Corporate Governance as stipulated under the SEBl (Listing Obligationsand Disclosure Requirements) Regulations 2015 together with a certificate from aPracticing Company Secretary confirming compliance is annexed and forms part of theAnnual Report.

[08] SUBSIDIARY COMPANIES

The Company has three wholly owned subsidiaries as on 31st March 2016.

In accordance with the provisions of Section 129(3) of the Companies Act 2013 theCompany has prepared a Consolidated Financial Statement of the Company and all thesubsidiaries namely Hooghly Printing Co. Ltd. Yule Engineering Ltd. and Yule ElectricalLtd. in compliance with the applicable accounting standards and the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.

[09] PERFORMANCE OF SUBSIDIARIES ASSOCIATE COMPANIES AND JOINT VENTURE COMPANIES ASREQUIRED UNDER RULE 8(1) OF THE COMPANIES (ACCOUNTS) RULES 2014

A statement containing sailent features of the financial statements of the subsidiariesand associates in Form AOC-1 is attached to the financial statements of the Company.

[10] CONSOLIDATED FINANCIAL STATEMENTS

The audited consolidated financial statements of your Company as on 31st March 2016have been prepared in accordance with the relevant Accounting Standards issued by theInstitute of Chartered Accountants of

India and Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and also in accordance with the applicable provisions of the CompaniesAct 2013 and form part of this Annual Report. The Financial Statements as stated aboveare also available on the website of the Company and can be accessed athttp://www.andrewyule.com.

[11] CHANGES IN SHARE CAPITAL

The Paid-up Equity Share Capital as on 31st March 2016 was Rs 667276956/- dividedinto 333638478 ordinary shares of Rs 2/- each fully paid up. During the year theCompany has not issued any ordinary shares or shares with differential voting rightsneither granted stock options nor sweat equity.

However the Company has allotted 12462500 Equity Shares of Rs 2/- each to Bank ofBaroda on 18th June 2016 in conversion of Working Capital Term Loan availed of by theCompany from Bank of Baroda as per direction given by the Cabinet Committee on EconomicAffairs (CCEA) at their meeting held on 6th April 2016. Accordingly as on date the postallotment Equity Share Capital of the Company has become Rs 692201956/- divided into346100978 Equity Shares of Rs 2/- each fully paid up.

[12] EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT- 9 as requiredunder Section 92 of the Companies Act 2013 is marked as Annexure II which isannexed hereto and forms part of the BoardRs s Report.

[13] NUMBER OF MEETINGS OF BOARD OF DIRECTORS

There were 4 (Four) meetings of the Board of Directors of the Company held during theyear 2015-16 on 30th May 2015 13th August 2015 2nd November 2015 and 28th January2016. The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013 and the Listing Regulations.

[14] DIRECTORSRs RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) read with Section 134(5) of theCompanies Act 2013 with respect to DirectorsRs Responsibility Statement it is herebyconfirmed that :

[i] in the preparation of the annual accounts for the financial year ended 31st March2016 the applicable accounting standards had been followed along with the properexplanation relating to material departures if any;

[ii] the Directors had selected such accounting policies and applied them consistentlyand made judgements and estimates that were reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company at the end of the financial year andof the profit and loss of the Company for that period;

[iii] the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

[iv] the Directors had prepared the annual accounts on a going concern basis;

[v] the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls were adequate and operating effectively;and

[vi] the Directors had devised proper system to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

[15] PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

Pursuant to Section 186 of the Companies Act 2013 the details of the loans givenguarantees or securities provided and investments made by the Company during the yearunder review have been disclosed in the financial statements.

[16] MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material change(s) and commitment(s) affecting the financial position ofthe Company occurring between the end of the financial year to which these financialstatements relate and the date of the report.

[17] DIRECTORS

Ms. Sanyukta Samaddar Director (Vigilance) Department of Heavy Industry has beenappointed as a Part-time Official Director on the Board of the Company with effect from27th May 2015 in place of Shri A. M. Manichan Dy. Director Department of HeavyIndustry.

Shri Debasis Jana has been appointed as Director (Planning) of the Company with effectfrom 1st August 2015 in place of Shri S. Swaminathan the erstwhile Director (Planning)of the Company.

Shri Bhaskar Jyoti Mahanta Joint Secretary Department of Heavy Industry has beenappointed as a Part-time Official Director designated as Additional Director on the Boardof the Company with effect from 21st March 2016 in place of Shri Rajesh Kumar SinghJoint Secretary Department of Heavy Industry.However being Additional Director he willhold office upto the date of the ensuing Annual General Meeting and is eligible forre-appointment. The Company has received notice in writing under Section 160 of theCompanies Act 2013 proposing his appointment as Director.

Shri Kallol Datta ceased to be the Chairman & Managing Director of the Company witheffect from the close of the business on 31st March 2016.

Shri Sunil Munshi has been entrusted with the additional charge of the post of theChairman & Managing Director of the Company with effect from 1st April 2016.

The Board places on record its deep appreciation of the valuable services and guidancerendered by Shri A. M. Manichan Shri S. Swaminathan Shri Rajesh Kumar Singh and ShriKallol Datta during their association with the Company.

In accordance with the provisions of Section 152(6)(c) of the Companies Act 2013 andyour CompanyRs s Articles of Association Ms. Sanyukta Samaddar Director of the Companyretires by rotation at the ensuing Annual General Meeting and is eligible forre-appointment.

In terms of the provisions of the Companies Act 2013 and other applicable provisionsif any Shri Sudhir Jhunjhunwala and Dr. Dhanpat Ram Agarwal have been appointed asPart-time Non-Official Independent Directors designated as Additional Directors for aperiod of 3 (three) consecutive years with effect from 4th July 2016. However beingAdditional Directors they will hold office upto the date of the ensuing Annual GeneralMeeting and are eligible for appointment for specified period(s) on approval of theshareholders. The Company has received notices in writing under Section 160 of theCompanies Act 2013 proposing their appointment as Directors.

Appropriate resolutions seeking appointment of Shri Bhaskar JyotiMahanta Ms. SanyuktaSamaddar Shri Sudhir Jhunjhunwala and Dr. Dhanpat Ram Agarwal as Directors are appearingin the Notice convening the 68th Annual General Meeting of the Company.

The brief resume/details relating to ShriBhaskar JyotiMahanta Ms. Sanyukta SamaddarShri Sudhir Jhunjhunwala and Dr. Dhanpat Ram Agarwal are furnished in the notes annexed tothe Notice of the ensuing Annual General Meeting of the Company.

Pursuant to the provisions of the Listing Regulation it is disclosed that no Directorshare any relationship inter se.

[18] KEY MANAGERIAL PERSONNEL

The following Key Managerial Personnel of the Company were appointed / resigned duringthe year 2015-16 in compliance with the provisions of Section 203 of the Companies Act2013 :

[i] Shri Kallol Dutta erstwhile Chairman and Managing Director ceased to be a KMPw.e.f. the close of business on 31st March 2016.

[ii] Shri Debabrata Bandyopadhyay erstwhile Company Secretary ceased to be a KMPw.e.f. 1st October 2015.

[iii] Shri Ayan Dutta was appointed as the Company Secretary designated as KMP w.e.f.1st October 2015.

Note:Shri Ayan Dutta ceased to be the Company Secretary as well as KMP of theCompany w.e.f. 12th August 2016 and re-designated as Assistant Company Secretary. Smt.Sucharita Das has been appointed as Company Secretary designated as a KMP of the Companyw.e.f. 12th August 2016.

[19] DECLARATION BY INDEPENDENT DIRECTORS

The Company has received the necessary declaration from all the Independent Directorsof the Company in accordance with Section 149(7) of the Companies Act 2013 that theymeet the criteria of Independence as prescribed under Section 149(6) of the Companies Act2013 and the Listing Regulations.

[20] APPOINTMENT AND REMUNERATION POLICY

Being aCentral PublicSector Undertaking the appointment tenure performanceevaluation remuneration etc. of Directors are made/fixed by the Government of India.The remuneration of officers is decided as per Government guidelines on Pay Revision andremunerations of other employees of the company are decided as per Wage SettlementAgreement entered with their Union every five years. The appointments/promotions etc. ofthe employees are made as per Recruitment and Promotion Policy approved by the Board.

[21] CORPORATE SOCIAL RESPONSIBILITY

In accordance with Section 135 of the Companies Act 2013 and the rules madethereunder the Company has formulated a Corporate Social Responsibility Policy a briefoutline of which along with the required disclosures is given in Annexure IIIwhich is annexed hereto and forms a part of the BoardsRs Report.

The detail of the CSR Policy is also posted on the website of the Company and may beaccessed at the link - http:// www.andrewyule.com/pdf/New_CSR_SD_Policy.pdf

[22] RISK MANAGEMENT

Risk Management is the process of identification assessment and prioritization ofrisks followed by coordinated efforts to minimize monitor and mitigate/ control theprobability and/or impact of unfortunate events or to maximize the realization ofopportunities.

The Board of Directors of the Company has constituted a Risk Management Committeevoluntarily. The Board has defined the roles and responsibilities of the Risk ManagementCommittee and has delegated monitoring and reviewing of the Risk Management Plans to theCommittee.

Relevant details of the Risk Management Committee have been furnished under theCorporate Governance Report.

[23] COMMITTEES OF BOARD

Details of various committees constituted by the Board of Directors as per theprovisions of the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 are given in the Corporate Governance Report and formspart of this report.

[24] RELATED PARTY TRANSACTIONS

The Company has not entered into any materially significant related party transactionsthat may have potential conflict with the interests of the company at large. Nonethelesstransactions with related party have been disclosed in Note No.10.14 to the accounts.Hence no disclosure is made in form AOC-2 as required under Section 134(3)(h) of theCompanies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014.

The related party transaction policy for determining materiality of related partytransaction and also on dealing with related parties is uploaded on the CompanyRs swebsite at the link - http://www.andrewyule.com/pdf/Policy_ Related_Party_Trasaction.pdf

[25] DISCLOSURES UNDER RULE 8(5) OF COMPANIES (ACCOUNTS) RULES 2014

[i] Financial summary or highlights : As detailed under the heading Rs FinancialPerformance.

[ii] Change in the nature of business if any : None

[iii] Details of Directors or Key Managerial Personnel (KMP) who were appointed orresigned during the year :

[a] Director(s) apointed : Ms. Sanyukta Samaddar
Shri Debasis Jana
Shri Bhaskar Jyoti Mahanta
[b] Director(s) resigned : Shri A. M. Manichan
Shri S. Swaminathan (retired)
Shri Rajesh Kumar Singh
[c] KMP(s) appointed : Shri Ayan Dutta
[d] KMP(s) resigned : Shri Debabrata Bandyopadhyay (retired)

[iv] Names of Companies which have become or ceased to be Subsidiaries Joint VentureCompanies or Associate Companies during the year: There were no such Companies in terms ofthe provisions of the Companies Act 2013.

[v] Details relating to deposits: There were no fixed deposits of the Company from thepublicoutstanding at the end of the financial year. No fixed deposit has been acceptedduring the year and as such there is no default in repayment of the said deposits.

[vi] There has not been any deposit which is not in compliance with the requirementsof Chapter V of the Companies Act 2013.

[vii] No significant and material orders have been passed by any Regulator(s) orCourt(s) or Tribunal(s) impacting the going concern status and CompanyRs s operations infuture.

[26] INTERNAL CONTROL SYSTEMS

Your Company has an adequate system of internal controls commensurate with its size andscale of operations that are designed to provide reasonable reassurance that the companyRss financial statements are reliable and prepared in accordance with the law. The InternalAudit function comprising of both external audit firms who have been appointed asinternal auditors and also the in-house internal audit team conducts the audits at eachunit of operation branch regional and head office as per the annual audit plan with theobjective to evaluate and continuously improve the effectiveness of internal controls andgovernance processes. Additional areas if any identified during the year are taken up asspecial assignments. The key Internal Audit findings are reviewed periodically by theCompany and corrective action as deemed necessary is taken. Your Company also has laiddown procedures and authority levels with suitable checks and balances encompassing theentire operations of the Company.

[27] DISCLOSURE AS PER RULE 5(1) OF COMPANIES (APPOINTMENT & REMUNERATION OFMANAGERIAL PERSONNEL) RULES 2014

The Company being a Government of India Enterprise is exempted to make disclosurepertaining to remuneration and other details as required under Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014. Hence no information is required to be appended tothis report in this regard.

[28] PARTICULARS OF EMPLOYEES - RULE 5(2) & 5(3) OF COMPANIES (APPOINTMENT &REMUNERATION OF MANAGERIAL PERSONNEL) RULES 2014

Your company has not paid any remuneration attracting the provisions of Rule 5(2) &5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.Hence no information is required to be appended to this report in this regard.

[29] MANPOWER

Manpower of the Company as on 31st March 2016 :

Category Executives Non-Executives Total
Male 310 7796 8106
Female 07 6747 6754
Total 317 14543 14860

[30] WELFARE OF WEAKER SECTIONS OF THE SOCIETY

Statutory welfare facilities as incorporated in the Factories Act 1948 and ThePlantation Labour Act 1951 are administered by the Company for its employees. Apart fromthe statutory welfare facilities the Company extends scholarships to the off spring of theemployees to encourage academic excellence for the ultimate betterment. In additionfinancial accommodation is extended to the employees for their welfare to addresseventuality and contingency. To promote sports talent in far flung areas of North EasternIndia. Soccer tournaments are organized at our Tea Gardens annually.

Percentage of employees in total strength of the Company belongs to SC / ST / OBC is asfollows :

SC - 17.06% ST - 29.44% and OBC - 51.24%.

[31] EMPOWERMENT OF WOMEN

The Company continues to accord due importance to gender equality. All necessarymeasures/statutory provisions for safeguarding the interests of women employees in issueslike payment of wages hours of work health safety welfare aspects and maternitybenefits etc are being followed by the Company.

Total number women employees as on 31st March. 2016 were as follows :

Officer 04 (four)
Non-unionised Supervisor 03 (three)
Staff 43 (forty-three)
Subordinate Staff 48 (forty-eight)
Plantation Worker 6656 (six thousand six hundred fifty six)
Total number of Women employees 6754 (six thousand seven hundred fifty four)

[32] PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

In accordance with the provisions of The Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013 the Internal Complaints Committee hasbeen constituted and the same holds meetings at regular interval. No complaint orallegation of sexual harassment has yet been received.

[33] GRIEVANCE REDRESSAL MECHANISM (GRM)

The Company expeditiously disposes of the public grievance and copy of the reply issent to the controlling Ministry in case the public grievance is forwarded by them.

[34] INDUSTRIAL RELATIONS

During the year under review Industrial Relations at the CompanyRs s units continuedto remain cordial and peaceful.

[35] SIGNING OF MEMORANDUM OF UNDERSTANDING (MOU) FOR THE YEAR 2016-17

Your Company has signed Memorandum of Understanding (MoU) with the Ministry of HeavyIndustries and Public Enterprises for the year 2016-17. The MoU sets forth various targetsand parameters of performance which are assessed against actual achievements after closeof financial year. The rating for 2015-16 has not been issued so far.

[36] IMPLEMENTATION OF THE RIGHT TO INFORMATION ACT 2005

The Company abides by the provisions of the Right to Information Act 2005 (RTI Act)and information seekers are furnished with relevant information by the Public InformationOfficers. Every endeavour is there on the part of the Company to dispose of theapplications expeditiously.

During the year ended on 31stMarch 2016 the number of applications received /accepted / rejected / disposed of under RTI Act is as follows :

Applications received 13 (thirteen)
Applications accepted 13 (thirteen)
Applications rejected NIL
Applications disposed of 13 (thirteen)

[37] VIGILANCE

The functioning of vigilance department includes preventive as well as punitivevigilance and the main thrust is on the systems improvements in the organisation.

Various activities of vigilance department during the year 2015-16 are as under :

[i] The disposal of scrap/ redundant assets across all divisions has been initiatedthrough MSTC.

[ii] As per the instructions of ChiefVigilance Commission (CVC) and Ministry quarterlystructured meetings of vigilance department with the management are being conductedregularly. During 2015-16 four meetings were conducted. Issues related to e-governanceleveraging of technology updation of DOP etc. have been discussed.

[iii] Tea division Engineering Division Electrical Division and M/s Hooghly PrintingCo. Ltd (HPCL) have commenced e-procurement & e—payment.

[iv] Updation of manuals: Various manuals such as Purchase Procedure Travelling anddaily expenses rules internal audit manual CDA Rules etc have been prepared and put inpractice. As per the instructions of the CVC and the Ministry the said manuals are alsoposted on the CompanyRs s website/ intranet and need-based updation of manuals is carriedout.

[v] Training programme: Periodical training programmes workshops interactivesessions presentation etc are organized by Vigilance Study Circle Kolkata Chapter. Beinga corporate member the programmes are attended by Officers from different departments ofAYCL as per the nomination of the Management.

[vi] Annual Property Returns: Annual Property Returns of executives are beingscrutinized regularly as per the guidelines of CVC.

[vii] Vigilance awareness week: Vigilance awareness week was observed from 26thOctober 2015 to 31st October 2015 at all the locations/offices of AYCL. Variouscompetitions workshops and seminars are conducted during the week for employees andstudents of school.

[38] PROGRESSIVE USE OF HINDI

In AYCL the Unicode system has been implanted in majority of the computers of theCompany. The Company has provided Hindi Language software in computers and impartingtraining to its employees so that AYCLRs s employees can use the same in their day-to-dayworkings. For propagating and implementation of the provisions of Official Language Act1963 the company is continuously organizing Hindi competitions like slogan writing KabyaPath Competition etc. and the same are published in the in-house magazine "YuleObserver". Employees are being given re-training under the "Hindi EducationScheme" of the Home Ministry in which 600 employees have already been given trainingfor Pragya (Higher Level) which is a continuous process in the Company. Employees of thecompany are encouraged to participate in various competitions in Hindi conducted by otherinstitutions.

[39] CORPORATE WEBSITE OF THE COMPANY

The Company maintains a website www.andrewyule.com where detailed information of theCompany is provided.

[40] RESEARCH & DEVELOPMENT (R & D) FACILITIES OF THE COMPANY

The main focus of in house R & D facilities in the Company is to provide continuousupgradation to the existing products to match the demand of the domestic market as well asto grab the opportunity in export market. The task includes new product developmentproduct extension and revalidation of the test certificates for the upper ranges to befollowed up by prototype development and commercialization. The CompanyRs s R & D setup has been recognized by the Department of Scientific and Industrial Research. Some ofthe R & D activities carried out by the companyRs s different Divisions were asfollows :

[a] For Tea research & development we are members of Tea Research Associationunder Tea Board Ministry of Commerce. Latest developments/ recommendations are adopted bythe Company for improving land productivity and quality of our tea produce.

[b] Engineering Division has developed designs of the new series of fans and offerssubmitted to customers are expected to mature in order in the forthcoming financial year;

[c] The new design of Siemens has already been developed validated and suppliesagainst orders have already commenced;

[d] The Chennai Unit of Electrical Division has commissioned the Impulse Generator withwhich transformers including 220 KV class rating can be tested.

[41] CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to Conservation of Energy Technology Absorption ForeignExchange Earnings and Outgo as required to be disclosed under provisions of Section134(3)(m) of the Companies Act 2013 read with Rule 8(3) of the Companies (Accounts)Rules 2014 are furnished in Annexure IV and forms part of the BoardRs s Report.

[42] PUBLIC PROCUREMENT POLICY FOR MICRO AND SMALL ENTERPRISES (MSE)

As required by the Public Procurement Policy of the Government of India theinformation on procurement from Micro and Small Enterprises during financial years 2015-16is given below :

[a] Procurement target from MSE is 20%

[b] Sub target of 4% out of 20% is to be procured from MSEs owned by SC/STentrepreneurs.

[43] TRAINING PROGRAMME

During the year 2015-16 total 39 training programmes (internal and external) wereconducted. Out of 404 participants who were imparted training during the year in variousprogrammes 176 were executives and unionized supervisors and 228 workers. Total 329 mandaysRs of training was completed on various topics during the year under review.

AYCL has been encouraging its workmen to show their inherent skills and has beenproviding various platforms to exhibit their skill.

[44] STATUTORY AUDITORS AND AUDIT REPORT

In terms of Section 143 (5) of the Companies Act 2013 M/s V. Singhi & AssociatesChartered Accountants have been appointed by the Comptroller & Auditor General of

India as auditors of your Company for the year 2015-16. There is no fraud reported byAuditors of the Company under sub-section (12) of section 143 of the Act. The StatutoryAuditorsRs Report is attached which is self explanatory.

In respect of the comments made by the Statutory Auditors in their report yourDirectors have stated that :

Type of Audit Qualification ManagementRs s View
Standalone Audit Qualification
1. No provision has been made in respect of diminution in the value of investments in WEBFIL Ltd. Fort Gloster Industries Ltd. Katras Jherriah Coal Co. Ltd. The New Beerbhoom Coal Co. Ltd. amounting to Rs 33.84 lakh. Diminution in the value of long term equity investment as stated point no. 1 is in the opinion of the management not of a permanent nature and accordingly no provision has been made in the Accounts. A suitable disclosure in this regard has been made in the Note No.10.08.
2. No provision for diminution in the value of investments in 6% Cumulative Redeemable Preference Shares amounting to Rs 204.40 lakh and Zero Rate Unsecured Redeemable Bond amounting to Rs 305.00 lakh of WEBFIL Ltd. The Company has decided to increase the moratorium period in respect of 6% Cumulative Redeemable Preference Shares- WEBFIL of Rs 204.40 lakh and WEBFIL Ltd. Zero Rate Unsecured Redeemable Bond of Rs 305.00 lakh for a period of 7 (seven) years commencing from 1st April 2014 and 20th December 2014 respectively. Hence Management feel no provision is required and suitable disclosure in this regard has been made in the Note No.10.24.
Consolidated Audit Qualification
3. No provision has been made in the Financial Statements for diminution in the value of noncurrent investments amounting to Rs 543.24 lakh (Refer Note No.10.10). Diminution in the value of long term equity investment as stated in point no. 3 it is in the opinion of the management not of a permanent nature and accordingly no provision has been in the Accounts. A suitable disclosure in this regard has been made in the Note No.10.10.
4. In the Financial Statements of Tide Water Oil Co. (I) Ltd. no provision has been made for diminution in value of noncurrent quoted investments amounting to Rs 41.00 lakh. Group interest in the same is Rs 10.75 lakh (Refer Note No. 10.11[i]). Diminution in the value of long term equity investment as stated in point no. 4 it is in the opinion of the management not of a permanent nature and accordingly no provision has been made in the Accounts.

5 In the financial statements of The New Beerbhoom Coal Co. Ltd.:

[a] No provision has been made in the financial statements for diminution in the value of long term Investments in Yule Financing and Leasing Co. Ltd. Yule Agro Industries Ltd. & Webfil Ltd. amounting to Rs 8.67 lakh. Group share in Consolidated Financial Statements is Rs 2.86 lakh (Refer Note No. 10.11[ii]). Diminution in the value of long term equity investment as stated in point no. 5(a) it is in the opinion of the management not of a permanent nature and accordingly no provision has been made in the Accounts..
[b] No provision has been made against non realisability of the principal on maturity amounting to Rs 4.50 lakh due from a body corporate. Group Share in Consolidated Financial Statements is Rs 1.48 lakh. (Refer Note No. 10.11[iv]). The amount stated in point no. 5(b) is realisable as per the opinion of the Management.

6 In the financial statements of Katras Jherriah Coal Co. Ltd. :

[a] Only those claims in relation to coking/non coking coal mines have been admitted by the respective commissioners of payments or are subject to appeal filed by the claimants and still pending with the Appellate Courts have been included in other long term liabilities. Accordingly the extent of adjustments as may be required in respect of claims under appeals still pending with the Appellate Court is not ascertainable. Refer Note 10.15(a). Financial impact is not ascertainable and the same is pending with appellate courts.
[b] From the available records and information it has not been possible to ascertain the extent to which amount receivable Rs 1.79 lakh may eventually be realized. Group Share in Consolidated Financial Statements is Rs 0.57 lakh [Refer Note No. 10.11(v)]. The amount stated in point no. 6(b) is realisable as per the opinion of the Management.
[c] No provision has been made against diminution in value of investments in Yule Agro Industries Ltd. and The New Beerbhoom Coal Co. Ltd. amounting to Rs 4.73 lakh. Group Share in Consolidated Financial Statements is Rs 1.50 lakh (Refer Note No. 10.11[iii]). Diminution in the value of long term equity investment as stated in point no. 6(c) it is in the opinion of the management not of a permanent nature and accordingly no provision has been made in the Accounts.
[d] No provision has been made against non realisability of the principal on maturity amounting to Rs 2.00 lakh due from a body corporate. Group share in the Consolidated Financial Statements is Rs 0.63 lakh (Refer Note No. 10.11[vi]). The amount stated in point no. 6(d) is realisable as per the opinion of the Management.

[45] SECRETARIAL AUDITOR AND AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Board hasappointed Shri Sahadeb Rath Practicing Company Secretary Proprietor of M/s. S. Rath& Co. Company Secretaries (C.P. No. 3452) 31/1 Chatawala Lane 2nd Floor RoomNo.209 Kolkata — 700012 to undertake the Secretarial Audit of the Company. TheSecretarial AuditorRs s Report is attached hereto as Annexure V and forms part ofthe BoardRs s Report.

There is no qualification in the report except on composition of the Board of thecompany as there were no independent directors as against requirement of 6 (six) duringthe financial year 2015-16. Being a Government Company all the directors are appointed bythe Government of India. The Board believes that the Government of India is in process ofappointment of requisite number of directors on the Board of AYCL. Presently in the Boardof AYCL 2 (two) independent directors were inducted and accordingly audit committee andother statutory committees were formed under compliance of the provisions of CompaniesAct 2013 and SEBI (LODR) Regulations 2015.

[46] COST AUDITORS AND COST AUDIT REPORT

Your Company has appointed M/s. DGM & Associates Cost Accountants (FirmRegistration No: 000038) as Cost Auditors of the Company for the year 2016-17 at theremuneration as set out in Item No.4 of the Explanatory Statement attached to the Noticewhich is subject to the ratification of the members in the ensuing Annual General Meeting.

The Company submits its Cost Audit Report with the Ministry of Corporate Affairs withinthe stipulated time period.

[47] COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA ON THE ACCOUNTS

The Comptroller and Auditor General of India (CAG) had conducted Supplementary Auditunder Section 143 (6) (a) of the Companies Act 2013 of the financial statements of AndrewYule & Co. Ltd for the year ended 31st March 2016. The comments of Comptroller &Auditor General of India under Section 143 (6) (b) of the Companies Act 2013 on theAccounts of the Company for theyear 2015-16 forms part of this report.

[48] GREEN INITIATIVES

As in the previous years this year also the electronic copies of the Notice have beensent to all the Members whose email IDs are registered with the Company/ CompanyRs sRegistrar and Share Transfer Agent/ Depository Participant(s) for communication purposes.The electronic copies of the Annual Report for the year 2015-16 are being sent to allMembers whose email addresses are registered with the Company/CompanyRs s Registrar andShare Transfer Agent/ Depository Participant(s). For members who have not registered theiremail addresses physical copies of Annual Report are being sent in the permitted mode.

[49] CAUTIONARY STATEMENT

Statements in the report describing the CompanyRs s objectives expectations and/oranticipations may be forward looking within the meaning of applicable Securities Law andRegulations. Actual results may differ materially from those stated in the statement.Important factors that could influence the CompanyRs s operations includes global anddomestic supply and demand conditions affecting selling prices of finished goodsavailability of inputs and their prices changes in the Government policies regulationstax laws economic developments within the country and outside and other factor such aslitigation and industrial relations.

The Company assumes no responsibility in respect of the forward-looking statementswhich may undergo changes in future on the basis of subsequent developments informationor events.

[50] ACKNOWLEDGEMENT

Your Directors place on record their appreciation of the endeavour of the employees atall levels and the services rendered by them.

The Board also gratefully acknowledges the valuable guidance support and cooperationreceived from Department of Heavy Industry Ministry of Heavy Industries & PublicEnterprises Government of India as well as other Ministries in both Central and StateGovernments.

The Board is also thankful to the CompanyRs s valued shareholders esteemed customersfor their valued patronage and for the support received from the bankers financialinstitutions and suppliers in India and abroad.

For and on behalf of the Board
Place: Kolkata Sunil Munshi
Date: 12th August 2016 Chairman & Managing Director

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