On behalf of the Board of Directors of your Company we share with you the AnnualReport along with the audited financial statements of your Company for the l year endedMarch 31 2017.
The financialperformance of the Company for the financial year ended March 31 2017 issummarised below:
| || |
|Particulars ||March 31 2017 ||March 31 2016 ||March 31 2017 ||March 31 2016 |
| || |
|Net Sales ||88167 ||86485 ||130630 ||117399 |
|Other Income ||2524 ||3125 ||2712 ||1767 |
|Operating Profit (EBIDTA) ||14626 ||17698 ||20005 ||20655 |
|Less: Depreciation/Amortisation Exp. ||2882 ||2652 ||4618 ||4268 |
|Finance Cost ||888 ||901 ||1029 ||926 |
|Provision for Tax ||2829 ||4124 ||3365 ||4677 |
|Net Profit before Exceptional Items ||8027 ||10021 ||10993 ||10784 |
|Add: Exceptional Items || || || ||478 |
|Less: Share of loss in Joint Ventures || || ||3 ||32 |
|Net Profit ||8027 ||10021 ||10990 ||11230 |
The Indian tyre industry showed a volume growth of 12% led primarily by the PassengerVehicles Scooters and Motorcycle/Moped segments.
While the tyre production for Medium and Heavy
Commercial Vehicles (M&HCV) de-grew by 3% the tyre production for Light CommercialVehicle
(LCV) segment grew by 7%. Pick-up in rural demand thanks to an above-normal monsoon isevident with the demand for all tractor tyres (front rear and trailer) growing in doubledigits.
On a standalone basis your Company achieved a net turnover of Rs 88167 million asagainst Rs 86485 million during the previous financial year. EBIDTA was at Rs14626 million as compared to Rs 17698 million during the previous financial year. Thenet profit for the year under review was Rs 8027 million as against Rs 10021 million inthe previous fiscal.
The consolidated net turnover of your Company was Rs 130630 million during FY17 ascompared to Rs 117399 million in FY16. The consolidated EBIDTA was Rs 20005 million forFY17 as compared to Rs 20655 million for the previous financial year. On consolidatedbasis Apollo Tyres earned a net profit ofRs 10990 million for FY17 as against Rs11230 million for the previous financial year.
The year under review witnessed the raw material cost increasing by around 3% after 4years of continued decline in raw material prices.
The first half of FY17 saw raw material prices ruling lower than the correspondingperiod in the last fiscal. The raw material prices rose sharply in the second half of FY17over the same period last year putting pressure on the margins.
The OPEC oil pact in November 2016 acted as the trigger for reversal of the softeningtrend in commodity prices. OPEC members agreed to reduce their output from 33.7 millionbarrels/ day to 32.5 million barrels/ day. This led to Oil Prices (Brent Crude) breachingthe barrier of USD 50/ barrel and prices have stayed in the band of USD 54 56/ barrelsince then.
Natural Rubber prices started to rise during 2016 on the back of InternationalTripartite Rubber Council (ITRC) agreeing to continue export cutbacks through theimplementation of the Agreed Export Tonnage Scheme (AETS) by major exporting countries.The prices rose sharply from November 2016 onwards due to floods in rubber producingregions of Thailand affecting the availability leading to supply crunch. The internationalrubber prices for TSR 20 grade touched a level of USD 2.3/kg in February 2017 from a levelof USD 1.3/kg in August 2016 representing a 77% rise.
The demand-supply gap in Natural Rubber continued during the year. As per the IndianRubber Board estimates the shortfall in production in the country is likely to be around374000 MT. This shortfall together with the fact that rubber required for radialapplication needs to be imported from major producing countries such as Thailand andIndonesia leads to a significant of natural rubber.
The other major raw materials such as Synthetic Rubber Carbon Black Nylon Fabric alsowent up in the later part of the year. Synthetic rubber prices in particular spurted byaround 40% aided by steep increase in the butadiene prices during the second half of theyear.
The antidumping duty continues on imports of major raw materials - Carbon Black fromChina and Russia Nylon Fabric from China Rubber Chemicals from China EU and Korea. Theantidumping duty investigations have been initiated on the imports of Styrene ButadieneRubber (SBR) and Poly Butadiene Rubber (PBR).
The Company strengthened its sourcing organisation by setting up procurement office inSingapore to work closely with the suppliers in the South East Asian region having directbusiness with the manufacturers.
Your Company has a consistent track record of dividend payment. The Directors arepleased to recommend a dividend of Rs 3/- (300%) per share of Rs 1/- each on Equity ShareCapital of the Company for FY17 for your approval. There will be no tax deduction atsource on dividend payments but those shareholders receiving a dividend income exceedingRs 10 lakh would become liable to pay additional tax @ 10%. Your Company would continueto bear tax on dividend @ 20.36% inclusive of surcharge.
The dividend if approved shall be payable to the members holding shares as on recorddate i.e. June 28 2017.
The amount available for appropriations including surplus from previous year amountedto Rs 33826 million. Surplus of Rs 32731 million has been carried forward to the balancesheet. A debenture redemption reserve of Rs 94 million and general reserve of Rs 1000million has been provided.
BOARD OF DIRECTORS
A) Appointment/Re-appointment of Director
Mr. Paul Antony (DIN: 02239492) IAS Additional
Chief Secretary was nominated by Government of Kerala as a Director on the Board ofthe Company in place of Mr. P. H. Kurian (DIN: 00027596) w.e.f. November 18 2016.
Pursuant to the provisions of Section 152 (6) of the Companies Act 2013 Mr. PaulAntony (DIN: 02239492) Nominee Director of the Company is liable to retire byrotation and being eligible offers himself for re-appointment.
Mr. Paul Antony is not disqualified under Section 164(2) of the Companies Act 2013.
B) dependenceonimports Changes in Directors and Key Managerial Personnel
During the year under review except the nomination of Mr. Paul Antony IAS AdditionalChief Secretary in place of Mr. P. H. Kurian to the Board of the Company by Government ofKerala w.e.f. November 18 2016 there were no changes in Directors and Key ManagerialPersonnel of the Company.
C) Declaration by Independent Directors
In terms with Section 149 (7) of the Companies Act 2013 every Independent Director ofthe Company has submitted a declaration that they meet the criteria of
D) Formal Annual Evaluation
Pursuant to the provisions of the Companies Act 2013 the Board is required to carryout annual evaluation of its own performance and that of its committees and individualDirectors. The Nomination and
Remuneration Committee of the Board is also required to carry out evaluation of everyDirectors performance.
Accordingly your Company has carried out the performance evaluation during the yearunder review.
For annual performance evaluation of the Board as a whole its Committee(s) andindividual Directors including the Chairman of the Board the Company has formulated aquestionnaire to assist in evaluation of the performance. The questionnaire is based on"Guidance Note on Board Evaluation" as prescribed by SEBI vide its circulardated January 5 2017. Every Director has to fill the questionnaire related to theperformance of the Board its Committees and individual Directors except himself by ratingthe performance on each question on the scale of 1 to 5 1 being Unacceptable and 5 beingExceptionally Good.
On the basis of the response to the questionnaire a matrix reflecting the ratings wasformulated and placed before the Board for formal annual evaluation by the Board of itsown performance and that of its
Committees and individual Directors. The Board was satisfied with the evaluationresults.
E) Separate Meeting of Independent Directors
In terms of requirements under Schedule IV of the
Companies Act 2013 and Regulation 25 (3) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a separate meeting of the Independent Directors was heldon December 16 2016.
The Independent Directors at the meeting inter alia reviewed the following:-
Performance of Non-Independent Directors and Board as a whole.
Performance of the Chairperson of the Company taking into account the views ofExecutive Directors and Non-Executive Directors.
Assessed the quality quantity and timeliness of flow of information between theCompany
Management and the Board that is necessary for the Board to effectively and reasonablyperform their duties.
F) Remuneration Policy
The Board has on the recommendation of the
Nomination & Remuneration Committee laid down a Nomination & RemunerationPolicy for selection and appointment of the Directors Key Managerial Personnel and SeniorManagement and their remuneration. The extract of the Nomination and
Remuneration Policy provided in the Corporate
Governance Report forms part of Boards Report.
PRODUCT & MARKETING
In FY17 the APMEA operations continued its focus on key themes for the Indian market -consolidating its leadership position and expanding market share by introducing newproducts across segments. For other countries in the APMEA region the objectives were tocontinue seeding the markets with country specific products building brand salience andexpanding the distribution network.
During the year the Company expanded its TBR capacity of its Chennai unit from 6000units per day to 9000 units per day. Benchmarked on both counts quality and value theCompany TBR tyres are the preferred choice for major CV OEMs like Tata Motors AshokLeyland Eicher Motors Bharat Benz etc.
It introduced new TBR products to cater to various applications including ApolloEndumile LHD Apollo Enducomfort CA etc. In the TBB market the Company introducedpremium products like Amar Gold and XT-7. To further enhance the customer experience theCompany expanded its network of Apollo CV zones to 15 and increased the Apollo RetreadZone network in India. The Company did multiple high impact programs like ApolloAazadi Ke Rang and Load ka Champion to engage with the customers. In thePassenger Car segment the Company increased the reach for its top selling product -Amazer 4G Life by another 13 new sizes. Further the Companys branded retailnetwork increased to 290 stores spread across 150 cities. From an OE perspective theCompanys tyres are an OE fitment to 16 of the Top 20 cars on Indian roads. Withinthe first year of launch Apollo crossed the 1 million tyre mark in the two-wheelerscategory. The
Company continued its association with Manchester United as it signed a globalsponsorship agreement for another 3 years.
The Europe operations continued to build on its Agriculture portfolio as it unveilednine new sizes of the Traxion85 range. The Companys dedicated satellite R&Dcentre in Raunheim (Frankfurt) Germany continues to work towards establishing ties withleading German OE customers for both Apollo and Vredestein brands. Further the Vredesteinbrand became official tyre partner of Mille Miglia a race for classic and vintage cars.
EXPANSION PROGRAMME AND FUTURE OUTLOOK
Apollo Tyres will continue its three-pronged strategy:
- To consolidate market position in existing markets and seek new markets/ newsegments;
- To continue investment in both the brands - Apollo and Vredestein and capacityexpansion via Greenfield/ Brownfield
- To seek other growth opportunities.
The Company has announced plans to set up a plant in
Andhra Pradesh India.
With the commencement of the commercial production of the Hungarian plant the Companyhopes to increase the continuous and regular supply of its highly rated tyres to theEuropean customers. The Company will further strengthen its portfolio especially theall-season given the strong industry and Company growth in this segment.
The Company strategy around Premiumisation in PV segment will further see growth in the17 inch and above segment. Importantly the Company wants to replicate its TBR successstory in European market and launched a disruptive online model to enter the European CVsegment.
MATERIAL CHANGES AND COMMITMENTS
No material changes and commitments affecting the financial position of your Companyhave occurred between the end of the financial year of the Company to which the financialstatements relate and on the date of this report.
SIGNIFICANT MATERIAL ORDERS PASSED BY REGULATORS
No significant material orders have been year under review by the regulators or courtsor tribunals impacting the going concern status and Companys operations in future.
CHANGE IN THE NATURE OF BUSINESS IF ANY
There is no change in the nature of business of your
Company during the year under review.
INTERNAL FINANCIAL CONTROLS
The Company has identified and documented all key internal financial controls as partof standard operating procedures (SOPs). The SOPs are designed for all critical processesacross all plants warehouses and offices wherein financial transactions are undertaken.The SOPs cover the standard processes risks key controls and each process is identifiedto a process owner. In addition the Company has a well defined Financial Delegation ofAuthority (FDOA) which ensures approval of financial transaction by appropriatepersonnel.
The Company uses SAP-ERP to process financial transactions and maintain its books ofaccounts. The SAP has been setup to ensure adequacy of financial transactions andintegrity & reliability of financial reporting. SAP was implemented in the Europe(Netherlands operation) in the previous year with continued work on the same in thecurrent year and it is under implementation at the
Companys Greenfield plant in Hungary.
The financial controls are evaluated for operating effectiveness throughManagements ongoing monitoring and review process and independently by InternalAudit.
The testing of controls by Internal Audit are divided into three separate categories;a) automated controls within SAP b) segregation of duties within SAP and restrictedaccess to key transactions c) manual process controls.
In our view the Internal Financial Controls are adequate and are operating effectively.
SHIFTING OF REGISTERED OFFICE
The Registered Office of your Company has been shifted to 3rd Floor Areekal MansionNear Manorama Junction Panampilly Nagar Kochi 682036 w.e.f. May 1 2016.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
As required by Regulation 34 (2) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a detailed Management Discussion and Analysis
Report is presented in a separate section forming part of the Annual Report.
COMMENCEMENT OF PRODUCTION AT HUNGARY PLANT
The Companys 6th tyre manufacturing unit and second in Europe at GyongyoshalaszHungary was inaugurated by the Honourable Prime Minister of Hungary Mr. Viktor Orban onApril 7 2017. This is Companys first greenfield facility outside India.
This facility will help the Company to further increase its presence and market sharein Europe. From being only a replacement market focussed company in Europe the
Company would soon be starting supplies of passenger car tyres to all the leading OEsin Europe.
GLOBAL R&D CENTRE ASIA
The Companys 2nd Global R&D Centre Asia just outside the southern Indiancity of Chennai was inaugurated on
November 9 2016. First Global R&D Centre Europe is in Enschede the Netherlandswhich is operational since 2013. The two Global R&D Centres of Apollo Tyres inaddition to the core research service the product development needs of the respectiveregions. The Global R&D Centre Europe services the Europe and America region whilethe Global R&D Centre Asia services the product development needs for the entireIndia Asia Pacific Middle East & Africa region.
SUBSIDIARY/ASSOCIATE & JOINT VENTURE COMPANIES
As the Company follows its vision to become a global tyre brand of choice it createdmultiple subsidiaries/ associates for facilitating these operations in various countries.As on March 31 2017 your Company had 42 subsidiaries including step subsidiaries 1associate and 1 joint venture.
The Honble High Court of Kerala on August 26 2016 had sanctioned the scheme ofamalgamation of Apollo
(Mauritius) Holdings Pvt. Ltd. ("AMHPL") a wholly owned subsidiary with theCompany. The appointed date of amalgamation was April 1 2016.
The Corporate and Business Registration Department
Mauritius vide its letter dated December 7 2016 had approved the amalgamation ofAMHPL with the Company thereby removing the name of AMHPL from its register.
AMHPL was amalgamated with the Company with effect from December 7 2016.
Apollo Tyres Cooperatief U.A. had incorporated Saturn F1 Pvt. Ltd as its whollyowned subsidiary on September 16 2016 in United Kingdom.
Apollo Tyres Cooperatief U.A. had incorporated Retail Distribution Holding B.V. as itswholly owned subsidiary on February 14 2017 in Netherlands.
Apollo Tyres Cooperatief U.A had incorporated Rubber
Research LLC as its wholly owned subsidiary on February
16 2017 in United States of America.
Apollo Tyres (Cyprus) Pvt. Ltd. wholly owned subsidiary of the Company is underwinding up.
Vredestein Norge AS wholly owned subsidiary of Apollo
Vredestein B.V. was wound up on March 21 2017.
As per the provisions of Section 129 of the Companies Act 2013 the consolidatedfinancial statements of the
Company and its subsidiaries are attached in the Annual
Report. A statement containing brief financial details of all the subsidiaries of theCompany for the year ended March
31 2017 forms part of the Annual Report. The annual accounts of subsidiary companieswill be made available to shareholders on request and will also be kept for inspection byany shareholder at the Registered Office and Corporate Office of your Company. A statementin Form AOC-1 containing the salient features of the financial statements of theCompanys subsidiaries associate and joint venture is also attached with financialstatements.
The following series of Secured Redeemable Non-Convertible Debentures (NCDs) wereissued and allotted during the year under review through Private Placement:-
| || ||No. of NCDs @ Face Value || || |
|Sl.No ||Series of NCDs || ||Value (Rs in Million) ||Date of Allotment |
| || ||Rs 1000000 each || || |
|1 ||8.65% Series A B & C ||3250 ||3250 ||May 30 2016 |
|2 ||7.50% Series A B & C ||3000 ||3000 ||October 21 2016 |
The aforesaid NCDs are listed on the debt segment of the National Stock Exchange ofIndia Limited (NSE).
During the year under review your Company did not accept deposits covered underChapter V of the Companies Act
Pursuant to Section 139 (2) of the Companies Act 2013 read with Companies (Audit andAuditors) Rules 2014 the Company at its 41st Annual General Meeting (AGM) held on August6 2014 had appointed M/s. Deloitte Haskins & Sells as Statutory Auditors for aperiod of 3 years i.e up to the conclusion of the 44th AGM to be held in the year
2017. The present term of M/s. Deloitte Haskins & Sells Statutory Auditors wouldexpire at the conclusion of the ensuing AGM.
The Board of Directors of your Company has proposed the appointment of M/s. WalkerChandiok & Associates Chartered Accountants (Grant Thornton International Ltd.) asthe Statutory Auditors of the Company to hold office from the conclusion of this 44th AGMuntil the conclusion of the 49th AGM.
The Company has received a letter from the Auditors confirming that they are eligiblefor appointment as Statutory Auditors of the Company under Section 139 of Companies Act2013 and meet the criteria for appointment specified in Section 141 of the Companies Act2013
The comments on statement of accounts referred to in the report of the Auditors areself explanatory. The Auditors Report does not contain any qualificationreservation adverse remark.
M/s. N. P. Gopalakrishnan & Co. Cost Accountants were appointed with the approvalof the Board to carry out the Cost Audit in respect of the Companys facilities atPerambra Vadodara and Chennai as well as Companys lease operated plant atKalamassery for FY17.
Based on the recommendation of the Audit Committee
M/s. N. P. Gopalakrishnan & Co. Cost Accountants being eligible have also beenappointed by the Board as the
Cost Auditors for FY18 subject to members approval. The
Company has received a letter from them to the effect that their re-appointment wouldbe within the limits prescribed under Section 141(3)(g) of the Companies Act 2013 andthat they are not disqualified for such re-appointment within the meaning of Section 141of the Companies Act 2013.
MEETING OF THE BOARD OF DIRECTORS
A calendar of meetings is prepared and circulated in advance to the Directors. Duringthe year four Board meetings were convened and held. The intervening gap between themeetings was within the period prescribed under the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The details of allBoard/ Committee meetings held are given in the Corporate Governance Report.
The details of the Audit Committee including its composition and terms of referencementioned in the Corporate
Governance Report forms part of Boards Report.
The Board during the year under review had accepted all recommendations made to it bythe Audit Committee.
VIGIL MECHANISM WHISTLE BLOWER POLICY
The Company has formulated a vigil mechanism through Whistle Blower Policy to deal withinstances of unethical behaviour actual or suspected fraud or violation of
Companys code of conduct or ethics policy. The details of the policy areexplained in the Corporate Governance Report and also posted on the website of theCompany.
COMMITTEES OF BOARD
Pursuant to requirement under Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board of Directors has constituted variousCommittees of Board such as Audit Committee
Nomination & Remuneration Committee Stakeholders
Relationship Committee Business Responsibility Committee and Corporate SocialResponsibility Committee. The details of composition and terms of reference of theseCommittees are mentioned in the Corporate Governance Report.
During the year under review the Issued Subscribed and
Paid-up Share Capital of the Company was 509024770 shares of Rs 1/- each. There wasno change in the capital structure of the Company.
a) Issue of equity shares with differential rights
Your Company has not issued any equity shares with differential rights during the yearunder review.
b) Issue of sweat equity shares
Your Company has not issued any sweat equity shares during the year under review.
c) Issue of employee stock options
Your Company has not issued any employee stock options during the year underreview.
d) Provision of money by company for purchase of its own shares by employees or bytrustees for the benefit of employees
Your Company has not made any provision of money for purchase of its own Shares byemployees or by trustees for the benefit of employees during the year under review.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186
During the year under review your Company has not given any loan or guarantee which iscovered under the provisions of Section 186 of the Companies Act 2013.
However details of investment made during the year are given under notes to thefinancial statements.
RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the
Company during the financial year with related parties were in the ordinary course ofbusiness and on an arms length basis and do not attract the provisions of Section
188 of the Companies Act 2013. During the year the
Company had not entered into any contract/ arrangement/ transaction with relatedparties which could be considered material in accordance with the policy of the Company onmateriality of related party transactions.
Suitable disclosure as required by the applicable Accounting Standards has been made inthe notes to the financial statements. The Policy on Related Party
Transactions as approved by the Board is uploaded on the
MANAGERIAL REMUNERATION a) The details required pursuant to Rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are providedin the Corporate Governance Report.
b) During the year under review Mr. Neeraj Kanwar (DIN: 00058951) Vice Chairman &Managing Director also received remuneration from Apollo Tyres (UK) Pvt. Ltd. whollyowned subsidiary of the Company.
PARTICULARS OF EMPLOYEES
Particulars of employees as required in terms of the provisions of Section 197 of theCompanies Act 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are set out in Annexure A to the Boards Report.
SEXUAL HARASSMENT AT WORKPLACE
Your Company has in place a formal policy for prevention of sexual harassment of itsemployees at workplace.
During the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Company hasre-appointed M/s. PI & Associates Company Secretaries as Secretarial Auditor of theCompany for FY17 to undertake Secretarial Audit of the Company.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark. Secretarial Audit Report given by Secretarial Auditors is annexed with the reportas Annexure I.
AWARDS AND RECOGNITIONS
In its constant quest for growth and excellence your Company was honoured andrecognised at various forums. The prominent Awards are listed below for your reference.
|Name of the Award ||Category ||Awarded by |
|Best Corporate Citizen Award ||CSR initiatives ||Kerala Chapter of National Institute of Personnel Management (NIPM) |
|CSR Excellence Award 2016 ||Promoting Ecological and Environmental Sustainability ||Bureaucracy Today (BT) |
|ICQCC 2016 ||Quality ||The Association of QC Headquarters of |
| || ||Thailand in co-operation with Department of Industrial Promotion Ministry of Industry |
|Corporate Talent Championship 2016 ||Group Theatre ||Engage4more |
|CSR Excellence Award 2016 ||CSR initiatives ||Quality Circle Forum of India |
|Sparsha Award 2016 ||CSR initiatives ||National Institute of Industrial Engineering |
| || ||(NITIE) and LakshyaSM |
|Golden Peacock Award for Excellence in Corporate Governance 2016 - Special Commendation ||Corporate Governance ||India's Corporate Institute of Directors (IOD) |
|NDTV Architecture and Design Award 2016 ||Office Category ||NDTV Architecture and Design Award for |
| || ||Apollo Tyres R&D Centre |
|2015/16 Vision Awards ||Annual Report; ||League of American Communications |
| ||Annual Report - Best Letter to ||Professionals (LACP) |
| ||Shareholders; || |
| ||Annual Report - Top 50 Reports Worldwide || |
The Company has a well laid out Risk Management Policy covering the process ofidentifying assessing mitigating reporting and reviewing critical risks impacting theachievement of Companys objectives.
The Risk Management Steering Committees have been formed for APMEA and Europe regionswhich are headed by President (APMEA) and President (Europe) as Chairman of the respectiveCommittees and represented by the functional heads as Chief Risk Officers. The Committeesreview each risk on a quarterly basis and evaluate its impact and plans of mitigation. Therisks are documented in form of risk register which are placed before Audit Committee atits meeting(s). The Audit Committee of the Company reviews the risks of APMEA and Europeregions and provides its directions to the management if any. The audit committee updatesthe Board on the key risks placed before it.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has been taking initiatives under Corporate Social Responsibility (CSR)for society at large well before it has been prescribed through the Companies Act 2013.The Company has a well definedPolicy on CSR as per the requirement of Section 135 of theCompanies Act 2013 which covers the activities as prescribed under Schedule
VII of the Companies Act 2013. The Company has an in-house department which isexclusively working towards that Objective. The Company is carrying out its CSR Activitiesthrough registered trusts created by the Company for this purpose and which is monitoredby CSR Committee.
During the year under review your Company has carried out activities primarily relatedto promoting preventive healthcare ensuring environmental sustainability livelihoodenhancement projects rural development projects promoting education and eradication ofhunger poverty & malnutrition.
Corporate Social Responsibility Report pursuant to clause
(o) of sub-section (3) of Section 134 of the Act and Rule 9 of the Companies (CorporateSocial Responsibility) Rules 2014 forms part of this Report as Annexure II.
BUSINESS RESPONSIBILITY REPORT
SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 mandates thetop 500 Listed Companies by Market capitalisation to give Business Responsibility Report("BR Report") in their Annual Report effective from April 1 2016.
Your Company falls under the top 500 Listed Companies by market capitalisation.Accordingly a BR Report describing the initiatives taken by the Company from anenvironmental social and governance perspective forms part of this Report as AnnexureIII.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars required under Section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 regarding conservation of energy technologyabsorption and foreign exchange earnings and outgo are given in Annexure IV forming partof this report.
EXTRACT OF THE ANNUAL RETURN
The extract of the annual return in Form MGT 9 is enclosed herewith as Annexure Vforming part of this report.
CORPORATE GOVERNANCE REPORT
Your Company always places major thrust on managing its affairs with diligencetransparency responsibility and accountability thereby upholding the important dictumthat an organisations corporate governance philosophy is directly linked to highperformance.
The Company is committed to adopting and adhering to established world-class corporategovernance practices. The Company understands and respects its fiduciary role andresponsibility towards its stakeholders and society at large and strives to serve theirinterests resulting in creation of value and wealth for all stakeholders.
The compliance report on corporate governance and a certificate from M/s. Deloitte
Accountants Statutory Auditors of the Company regarding compliance of the conditionsof corporate governance as stipulated under Chapter IV of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is attached herewith as Annexure VI to thisreport.
DIRECTORS RESPONSIBILITY STATEMENT
As required by Section 134(3)(c) of the Companies Act 2013 your Directors state that:
(a) in the preparation of the annual accounts for the financial year ended March 312017 the applicable accounting standards had been followed along with proper explanationrelating to material departures;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the
Company at the end of the financial year and of the profit and loss of the Company forthat period;
(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Haskins & Sells Chartered
Your Companys organisational culture upholds professionalism integrity andcontinuous improvement across all functions as well as efficient utilisation of theCompanys resources for sustainable and profitable growth.
Your Directors wish to place on record their appreciation to the respective StateGovernments of Kerala Gujarat
Haryana and Tamil Nadu and the National Governments of India Netherlands and Hungary.We also thank our customers business partners members bankers and other stakeholdersfor their continued support during the year. We place on record our appreciation for thecontribution made by all employees towards the growth of your Company.
|For and on behalf of the Board of Directors || |
|Place: Gurgaon ||(ONKAR S. KANWAR) |
|Date: May 5 2017 ||Chairman & Managing Director |