Bharat Petroleum Corporation Ltd.
|BSE: 500547||Sector: Oil & Gas|
|NSE: BPCL||ISIN Code: INE029A01011|
|BSE LIVE 15:49 | 23 Mar||653.80||
|NSE LIVE 15:58 | 23 Mar||655.05||
|Mkt Cap.(Rs cr)||94550.60|
|Mkt Cap.(Rs cr)||94550.60|
Bharat Petroleum Corporation Ltd. (BPCL) - Director Report
Company director report
The Board of Directors is delighted to present its Report on the performance of BharatPetroleum Corporation Limited (BPCL) for the year ended 31st March 2016.
During 2015-16 the combined Refinery throughput of BPCL's Refineries at Mumbai andKochi along with its Subsidiary Company Numaligarh Refinery Limited (NRL) and considering50% throughput of Joint Venture Company Bharat L Oman Refineries Limited was 29.82Million Metric Tonnes (MMT) as compared to 29.27 MMT during 2014-15. The BPCL Group endedthe year with market sales of 36.83 MMT as compared to 34.95 MMT in the previous year.During the year the BPCL Group exported 1.90 MMT of petroleum products as against 2.22MMT in 2014-15.
The Financial Year saw the Group achieve a Gross Revenue from Operations of Rs.219253.07 crores as compared to Rs. 258731.09 crores recorded in 2014-15. The Profitafter Tax stood at Rs. 8463.98 crores in 2015-16 as against Rs. 5082.01 crores in theprevious year. The Group recorded earnings per share of Rs. 110.38 in the current yearagainst Rs. 66.47 in 2014-15 after setting off the minority interest.
CONSOLIDATED GROUP RESULTS
BPCL's Refineries at Mumbai and Kochi recorded a crude throughput of 24.12 MMT during2015-16 as compared to 23.36 MMT achieved in 2014-15. The Company's market sales grew by6% to 36.53 MMT in 2015-16 from 34.45 MMT in 2014-15.
During 2015-16 the Gross Revenue from Operations was Rs. 218011.04 crores lower by13.92% over the previous year's revenues of Rs. 253254.86 crores. The Profit before Taxfor the year was Rs. 10651.18 crores as compared to Rs. 7415.51 crores in 2014-15. Theyear 2015-16 has been an unprecedented year for BPCL with a Profit after Tax of Rs.7431.88 crores as against the previous year best of Rs. 5084.51 crores. This is afterproviding for tax (including deferred tax) of Rs. 3219.30 crores as against Rs. 2331.00crores during the last year.
The earnings per share crossed the Rs. 100 mark at Rs. 102.78 in 2015-16 as againstRs. 70.32 in 2014-15. Internal cash generation increased by almost 20% to Rs. 7167.13crores during 2015-16 as against Rs. 5989.18 crores in 2014-15. During 2015-16 theCompany has contributed to the exchequer by way of taxes and duties to the extent of Rs.67719.17 crores as compared to Rs. 51121.77 crores in the previous Financial Year.
As on 31st March 2016 BPCL's Shareholders' funds stand at Rs. 27158.69crores as against the previous year's figure of Rs. 22467.48 crores.
The Board of Directors recommended a final dividend of 150% (? 15.00 per share) for theyear on the paid-up share capital of Rs. 723.08 crores. This will absorb a sum of Rs.1273.11 crores inclusive of Rs. 188.48 crores for Corporate Dividend Tax on distributedprofits out of the profit after tax. In addition two interim dividends of 125% (' 12.50per share) and 35% (? 3.50 per share) totaling to Rs. 1359.44 crores inclusive of Rs.202.51 crores for Corporate Dividend Tax on distributed profits were distributed duringthe year.
The Company being a Central Public Sector Enterprise (CPSE) follows the Governmentguidelines for payment of dividend. Accordingly the Company has been implementing minimumdividend pay-out of 30% of post-tax profits. As per revised Government guidelineseffective from 27th May 2016 the CPSEs are required to pay a minimum annualdividend of 30% of profit after tax or 5% of the net-worth whichever is higher subjectto the maximum dividend permitted under the extant legal provisions.
Transfer to Reserves
It is proposed to transfer Rs. 4555.58 crores to the General Reserve out of the amountavailable for appropriation and a sum of Rs. 500.00 crores is to be retained as Surplus inthe Statement of Profit and Loss.
The year saw a decrease in borrowings from banks from Rs. 6925.26 crores as at 31stMarch 2015 to Rs. 6243.92 crores at the close of the current Financial Year. The Companyhad availed a loan from Oil Industry Development Board of which the balance outstanding ason 31st March 2016 is Rs. 1725.24 crores against Rs. 1049.50 crores at theend of the previous year. Debentures worth Rs. 700 crores issued in 2012-13 were redeemedduring the year 2015-16. 4.625% US Dollar International Bonds issued during 2012-13 of USD500 Million (equivalent to Rs. 3316.65 crores) 3% Swiss Franc International Bonds issuedduring 2013-14 of CHF 200 Million (equivalent to Rs. 1373.30 crores) and 4% US DollarInternational bonds issued during 2015-16 of USD 500 Million (equivalent to Rs. 3316.65crores) continued to remain outstanding as on 31st March 2016.
Deposits from Public
The Company has not accepted any deposit from the public during the year. The amount ofdeposits matured but unclaimed at the end of the year was ' 0.02 crores which pertainsto 7 depositors. The unclaimed amount is being transferred to the Investors Education andProtection Fund after the respective due dates.
The total Capital Expenditure during the year 2015-16 amounted to Rs. 9692.72 croresas compared to Rs. 8494.40 crores during the year 2014-15.
C& AG Audit
The Comptroller and Auditor General of Indias (C&AG) comment upon orsupplement to the Statutory Auditors Report on the Accounts for the year ended 31stMarch 2016 is annexed as Annexure E.
REFINERIES MUMBAI REFINERY
Mumbai Refinery registered a throughput of 13.41 MMT of feedstock (crude oil and otherfeedstocks) during the year 2015-16 in comparison to 12.96 MMT achieved in 2014- 15. Thisis the highest throughput ever achieved in Mumbai Refinery. Mumbai Refinery has alsoachieved 84.3% of distillate yield as against 81.8% in the previous year which again isthe highest ever achieved. The Refinery posted a capacity utilization of 111.7% during theyear against 108.0% in the last year.
The Refinery recorded its highest ever production during the year 2015-16 in MotorSpirit (MS) High Speed Diesel (HSD) Propylene and Lube Oil Base Stock (LOBS). MumbaiRefinery has again demonstrated its ability to meet the increasing demand for MS and HSDconforming to Euro IV quality norms.
The Gross Refining Margin (GRM) of USD 6.37 per barrel for the year is higher than theUSD 3.97 per barrel realized in 2014-15. The overall gross margin for the Refinery in2015-16 totaled to Rs. 4198 crores as compared to Rs. 2363 crores in 2014-15. Thehigher GRM in Mumbai Refinery for the year 2015-16 is primarily a result of higherdistillate yield better cracks higher production of transportation fuels and reductionin octroi cost.
Kochi Refinery reported a crude throughput of 10.71 MMT in 2015-16 against 10.40 MMT in2014-15. During the year the Refinerys capacity utilization was at 112.7% ascompared to the 109.5% registered in the previous year. Kochi Refinery recorded its bestever production of LPG BS-III MS BS-IV MS ATF and BS-IV HSD in
2015- 16. Further Kochi Refinery commenced increased supply of BS IV grade auto fuelseffective 15th February 2016 thereby meeting the demand of Southern India asper the directive of the Government of India.
Kochi Refinery recorded a GRM of USD 6.87 per barrel totaling to Rs. 3610 crores forthe year 2015-16. This is against the previous year achievement of USD 3.17 per barrel andRs. 1514 crores. The increase in GRM during 2015-16 over the previous year is mainly dueto better product cracks higher distillate yield efficient fuel and loss and bettercrude mix.
The GRM of BPCLs Kochi Refinery during Financial Year 2015-16 is the highest everin total rupee crores terms and one of the best in PSU refineries in USD per barrel terms.
The details of the performance of the Refineries their activities and future plans arediscussed in the Management Discussion and Analysis Report (MD&A).
BPCL's market sales volumes increased by 6.00% to 36.53 MMT in the year 2015-16 from34.45 MMT in the last year. The market share of BPCL amongst the Public Sector OilCompanies stood at 22.94% as at 31st March 2016 as compared to 23.29% as atthe end of the previous year.
A detailed discussion of the performance of the Marketing function is given in theMD&A.
Integrated Refinery Expansion Project (IREP) at Kochi
The Company's Integrated Refinery Expansion Project (IREP) at Kochi Refinery willincrease the Refinery capacity to 15.5 MMTPA from its present level of 9.5 MMTPA. Themodernization of the Refinery facilities envisages production of auto fuels conforming toBS-IV/VI specifications and upgradation of the residue streams to distillates and Petcoke.The approved cost of the project is Rs. 16504 crores.
The Crude Distillation Unit (CDU)/Vacuum Distillation Unit (VDU) and first Gas TurbineGenerator (GTG) are mechanically completed and pre-commissioning activities are inprogress. Raw water quarry & Raw water treatment plant have been commissioned. Othermajor units such as Diesel Hydro Treater (DHDT) two GTG two utility Boilers Vacuum GasOil Hydro Treater Sulphur Recovery Unit Delayed Coker Unit and Fluid Catalytic CrackingUnit are planned for completion sequentially as per commissioning requirements.
The project has achieved an overall physical progress of 96.42% with cumulativeexpenditure of Rs. 11626 crores as on 30th June 2016. The project is expectedto be operational and stabilized during the third quarter of the current Financial Year.
Propylene Derivative Petrochemical Project (PDPP) at Kochi Refinery
The project envisages production of niche Petrochemicals utilizing Polymer GradePropylene produced from the Petro Fluid Catalytic Cracking Unit (FCCU) being set up as apart of IREP. The PDPP project envisages production of Acrylic Acid Oxo Alcohols andAcrylates utilizing approximately 250000 MT per annum of Polymer Grade Propylene.
The approved cost of the project is Rs. 4588 crores with scheduled completion in May2018. The cumulative expenditure on the project is Rs. 324 crores as on 30thJune 2016.
Conversion of CRU to Isomerization (ISOM) Unit at Mumbai Refinery
The project envisages conversion of Catalytic Reformer Unit (CRU) to Isomerization Unit(ISOM) along with associated facilities. This would enable Mumbai Refinery to meet 100%Euro IV MS production.
The approved cost of the project is Rs. 725 crores with scheduled completion inDecember 2016. The project has achieved an overall physical progress of 83.2% as on 30thJune 2016 with a cumulative expenditure of Rs. 276 crores. The project shall be completedby 31st December 2016 well in time to meet the requirement of 100% BS IV autofuels by April 2017.
Installation of Diesel Hydrotreatment Unit (DHT) at Mumbai Refinery
The project envisages installation of 2.6 MMTPA capacity DHT to meet the Governmentmandate of producing 100% BS-IV HSD with effect from April 2017. The project alsoinvolves setting up of associated facilities such as new Amine Regeneration Unit (ARU) andrevamp of existing Sour Water Stripped Unit (SWS) to maximize capacity of Sulphur RecoveryUnit trains C & D.
The approved cost of the project is Rs. 2443 crores with scheduled completion inDecember 2017. The project has achieved an overall physical progress of 51.2% andincurred cumulative expenditure of Rs. 228 crores as on 30th June 2016. As perAuto Fuel Policy the BS IV fuels should be made available by April 2017. All efforts arebeing taken to complete the DHT part of project by then and other facilities included inthe project shall be completed in December 2017 as scheduled.
Ennore Coastal Terminal Project The project envisages construction of PetroleumOils & Lubricants (POL) Terminal at Ennore with tankage of 117035 Kl (gross) forstoring MS and HSD receipt through tanker from Ennore Tank Terminal Pvt. Ltd. (ETTPL) andproduct dispatch by road (16 bay gantry). The approved cost of the project is Rs. 393crores with scheduled completion in April 2018.
Palakkad LPG Terminal Project
The project envisages construction of 3 X 1450 MT Mounded Storage Vessels 8 bays TankLorry Decantation Gantry LPG Pump House (20M X 8M) and associated facilities. Theapproved cost of the project is Rs. 184 crores with scheduled completion in December2017.
LPG Import Facility at Haldia The project envisages construction of 2 X 15000 MTrefrigerated storage tanks for Propane & Butane facilities for Ocean tankerunloading Propane and Butane heating Ethyl Mercaptan Dosing and bulk despatches. Thisalso entails laying of a twin pipeline (one for Propane and the other for Butane) from thejetty to the terminal.
The approved cost of the project is Rs. 694 crores with scheduled completion inOctober 2018.
BS VI MS Block Project at Kochi Refinery
As per the directives of Ministry of Petroleum and Natural Gas and the Auto Fuel Policyguidelines Kochi Refinery plans to implement a BS VI MS Block Project. Thereafter theRefinery will be able to produce Petrol and Diesel complying with BS VI specifications.The estimated cost of the project is Rs. 3313 Crores and it is expected to produce BS VIcompliant auto fuels by April 2020. The Project Management Contract has been awarded andapplication has been made for Environmental Clearance. Licensor selection is in progress.
Gasoline Hydro Treatment Project at Mumbai Refinery Mumbai Refinery is implementinga Gasoline Hydro Treatment Project to produce 100% BS VI MS. The estimated cost of theproject is Rs. 554 Crores and with completion of this project it is expected to produce100% BS VI auto fuels by April 2020 to meet the Auto Fuel Vision & Policy 2025requirements. The Project Management Contract has been awarded and application has beenmade for Environmental Clearance. Licensor selection is in progress.
RESEARCH & DEVELOPMENT (R&D)
The current marketplace is moving towards a sustainable development framework withoutwhich our future would be at risk. To keep pace with current market trends and demandsthe Research and Development Centres of BPCL are proactively engaged in the development ofcleaner fuels/fuel additives and innovative products/ process technologies to reduceenvironmental footprints while improving the Companys profitability.
The Companys Corporate R&D Centre is at Greater Noida Uttar Pradesh Product& Application Development Centre is at Sewree Mumbai and the in-plant R&D Centreis located at Kochi Refinery. The Research and Development Centres of BPCL are alsoproviding advanced technical support for Refinery processes lubricant formulations andimproved product/process developments.
The R&D centers are broadly divided into four categories as per core researchareas: (a) Technical support to SBUs (b) Development of energy efficient technologies forfuel and chemical production (c) New product and additive development and (d) Alternativefuels and energy.
R & D areas and its benefits are summarized in Annexure A to the DirectorsReport.
NON-CONVENTIONAL ENERGY INITIATIVES BPCL is pursuing non-conventional energyinitiatives with great zeal so as to contribute meaningfully towards mitigating the risksof climate change.
During the year BPCL has commissioned 6.3 MW capacity Windmills at Hanumanthappa inDevangere District in Karnataka4 MW capacity Solar Power Plant at Bina MP and 1.05 MWcapacity solar power plant at Corporate R&D Centre at Noida in line with its RenewableEnergy policy. Under the wind energy project BPCL has installed 3 Wind Turbine Generators(WTGs) with a capacity of 2.1 MW each. The machines are of the latest technology with ahub height of 120 meters which is the highest in India at present. The power generationpotential is also higher at this hub height. The machines are performing extremely well.
The 4 MW Solar Power plant is supplying High Tension power to Bina Despatch terminaland Bina Kota Pipeline Pumping Station.
Further smaller KW scale Solar Plants with total capacity of 1500 KW have beeninstalled in 353 Retail Outlets. Currently BPCL is assessing the feasibility of settingup rooftop Solar Plants at its various POL installations and LPG plants. Developing moregrid connected wind power plants is also being explored.
Healthy Industrial Relations practices were observed throughout the year which ensuredhigher productivity and a harmonious IR climate across the Organization. The efforts topromote employees participation continued during the year with focus onproductivity enhancement and employee well-being. There were no cases of any industrialunrest.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
At BPCL energizing lives through Corporate Social Responsibility (CSR) initiatives isa commitment we have pledged to fulfill as a Corporate Citizen. CSR being ingrained in ourDNA we constantly endeavor to maximize the positive impacts of our activities and ensurethe benefits reach all our stakeholders. We have made significant progress over the yearsin our core thrust areas of Education Water Conservation Skill Development Health &Hygiene and Community Development. Through our CSR initiatives we have strived to improvethe livelihood opportunities and achieve sustainable changes in the communitiesneighboring our businesses across the country as well as in rural and tribal areas. In ourconstant endeavour to build a sustainable partnership with society we have scaled upexisting projects taken up newer initiatives and exited from those that have been takenover by the stakeholders involved.
Quality education is one of our core thrust areas under CSR. It is an important mediumto address the issue of inequality in the country. Education contributes to anindividuals well-being as well as the overall development of society. Hence theprojects supported by us under education are primarily focused on improving the learninglevels of students capacity building of teachers and creating facilities to minimizehurdles in the learning process. In our efforts to contribute to the above we havereached out to over 6.5 lac children since 2010.
BPCL had started the project Computer Assisted Learning (CAL) in 2009-10 with 11 ZillaParishad schools in Uran. Subsequently we have scaled up to over a 100 schools in MumbaiUran Panvel (Maharashtra) and Lucknow (UP). Currently we are present in 20 centres inJaipur (Rajasthan) 31 centres in Mumbai and 26 centres in Solapur (Maharashtra) inaddition to 42 centres in Uran and 15 centres in Lucknow thus taking computer educationto 37326 students in 169 schools. We are steadily working towards empowering the SchoolManagement Committees as well as local Government bodies to take over the projectownership for achieving sustainability. In 2009-10 when we started in Uran there was nocomputer education in any Zilla Parishad school. BPCL took the challenge of reaching outto each and every Zilla Parishad school in the Uran block. By the year 2015-16 we coveredall Zilla Parishad schools in the entire block of Uran. We have faced several challengeslike accessing remote villages where enrolments were low electricity was an issueclassrooms were not available and other such concerns. But we have come up with innovativesolutions to address these problems in order to take computer education to everyGovernment school in Uran.
The Science Education Project for students of Government schools near Solur Bangalore(Karnataka) has been extended to Government schools in Mumbai. The project focuses onexperiential learning models based on science concepts. It reaches the students through amobile science lab. This project has made hands-on science education available among poorrural children and teachers. The project in Bangalore consists of a Science Centre hubmobile science lab lab-in-a-box activities and a "Young Instructor Leader(YIL)" program. This YIL program is focused on democratizing leadership developmentand unlocking human potential through the students-teach-students model. Sofar we have reached out to over 8500 children in the last one year.
Our mega scale District-wide Project Akshar (Read India) for impacting learning levelsof children through learning camps with NGO partner Pratham Education Foundation wassupported by BPCL in 19 blocks for primary students in District Nandurbar (Maharashtra)Sagar (Madhya Pradesh) Jaipur and Dausa (Rajasthan). We have ensured the improvement inlearning level in Language and Mathematics through learning camps. At many locations wehave implemented the Read India plus model where focus has been on higher competencieslike comprehension and application of knowledge. We have also reached out to upper primarystudents in 6 blocks of Nandurbar and Sagar. 1160 schools 7970 students from StandardI-II 20865 students from Standard III-V 15844 students from Standard VI-VIII have beencovered. We continue supporting the education of tribal students in Sundergarh districtsof Odisha. Around 2550 primary students from tribal villages from 31 schools in 7 GramPanchyats from Kuarmunda block of Sundargarh district were given access to qualityeducation through remedial classes. Similarly we worked with 14 Government rural schoolsin Coimbatore District. In this project 372 academically low performing students fromStandard VI-IX were given remedial classes to enhance their learning levels in TamilMathematics and English.
We have also successfully completed the third batch of our in-house project"Saksham" for professional development of primary teachers and principals fromlow income schools. This project aimed at encouraging teachers to use new techniques forteaching classroom management as well as developing new teaching materials according tothe requirement of the class. By working with the teachers and school management we areeffecting a sustainable change in the existing education system. During the year thisproject reached out to 122 teachers from primary and upper primary classes from 50schools.
In order to encourage students from Government schools to read from an early age andtry to inculcate the habit of reading we continued to support 25 libraries in Mumbai andDelhi reaching out to 7040 students. Library books are classified as per the difficultylevel so that students can choose a book as per their reading ability.
With an objective to empower underprivileged unemployed youth women and persons withdisabilities near our businesses and also equip them with skills we have several NGOpartners in different parts of the country. Placement linked vocational training of 1000youth was supported by BPCL in Warangal and Nalagonda districts from Telangana and Krishnadistrict of Andhra Pradesh. Training was given in hospitality services tailoring retailsupervisory and computer fundamentals with computer accounting for the youth and women.Over 70% of these beneficiaries have been placed or are gainfully self-employed.
Along similar lines in Kolkata we supported the vocational skill training of 80disabled and underprivileged youth from economically backward families in DesktopPublishing. We also supported the skill building of the workforce in caring for theelderly. This project addresses two critical needs adequately improving the quality oflife of the elderly and providing employment opportunities for the unemployed youth. Inour innovative program named "Sanket" we have completed one year of vocationaltraining for persons with autism. The training is given through computers and iPad for 30adolescent autistic students.
During the year our water project 'Boond' has covered 36 villages from Tamil NaduKarnataka Maharashtra and Rajasthan. Boond which is a water conservation project throughrainwater harvesting now spans across the States of Tamil Nadu Andhra PradeshRajasthan Maharashtra Karnataka and Uttar Pradesh. Leveraging the strengths of the localpopulation we have formed Village Water Committees that have taken over the governanceand maintenance of the various water structures we have built. The water needs of over7000 families have been met and over 10 crore litres of water storage capacity have beencreated through construction/renovation of tanks ponds sub-surface dams wells checkdams and cordons. In addition to this our project also supports sustainable employmentthrough new and improved agricultural practices like crop rotation mulching newer cropsinnovative methods of irrigation and horticulture thereby increasing the availability andstorage of surface water and ground water increasing availability of drinking water forcattle decreasing levels of migration improving the quality of life of villagers andpositively affecting the environment.
The Driveway Salesmen (DSMs) and LPG Delivery boys in our Marketing networks arecritical players in our value chain. These people and their families are not protectedagainst major expenses arising from unforeseen health issues. The Company had initiated ahealth insurance scheme in 2014-15 through which an additional 19000 DSMs LPG deliveryboys and PCVO crew in 24 states have been covered to the extent of Rs. 1 lac for self andtheir families for one year. This decreases their financial burden especially in cases ofrecurring illness and major medical emergencies.
With an objective to improve and encourage institutional care and safe delivery ofbabies under supervised medical attention for tribals we work in HD Kote Taluka MysoreDistrict of Karnataka by supporting Reproductive and Child Healthcare. Over60000 villagers and specifically 9183 tribals from 57 Tribal hamlets are benefitted fromthis project where there has been a steady increase in institutional deliveries. We weresuccessful in ensuring 89% institutional deliveries and 99% birth dose immunizations.Awareness of Government Health Schemes including lectures on community topics likenutrition and infant mortality are being promoted through regular meetings with communitymembers.
In response to the Hon'ble Prime Ministers call to the Nation to give priorityunder CSR for construction of toilets as part of the Swachh Vidyalaya Campaignunder the Swachh Bharat Abhiyan BPCL had undertaken construction/repairs ofdysfunctional toilets totaling to 1910 toilet blocks in Government schools in the statesof West Bengal Andhra Pradesh Telangana Bihar Odisha Madhya Pradesh and Chhattisgarhspread across 26 districts.
BPCL deputed 40 officers in the field at respective locations to ensure quality ofconstruction and timely completion of the project. This project was implemented overcomingseveral obstacles pertaining to logistics power and manpower availability at many remoteand inhospitable terrains within the scheduled deadlines through extensive monitoring andcontinuous follow-up with all stakeholders and agencies involved. We have also endeavouredto provide for water in the toilet blocks so as to ensure cleanliness and hygiene.
The Annual Report on CSR activities in the specified format is provided in Annexure B.The CSR Policy may be accessed on the Companys website at the link
PROMOTION OF SPORTS
Our sportspersons continued to excel in the national as well as international sportsarena in the fields of Cricket Hockey Badminton Chess Table Tennis Bridge Kabaddiand Volleyball. BPCL sportspersons won several distinctions and applause. Our Hockey andVolleyball teams won most of the major All India tournaments.
Six of our Hockey players namely S. V. Sunil Manpreet Singh Md. Amir Birendra LakraDevinder Walmiki and Harmanpreet Singh were part of the Indian team which won the BronzeMedal at the Hockey World League. Tushar Khandker ex-Olympian is the Assistant Coach ofthe Indian Hockey team.
Our Kabaddi team excelled once again winning a number of open tournaments. Most of ourKabaddi players which include leading performers - Rishank Devadiga Nilesh ShindeVishal Mane were part of the successful Pro-Kabaddi League 2016.
In Cricket Manish Pandey and Dhawal Kulkarni have been selected in the Indian team. Inindividual sports Saina Nehwal led the Indian team - Jwala Gutta PV. Sindhu and RuthvikaShivani Gadde to win the Bronze medal at the Uber World Cup 2015-16. Our latest recruitbadminton player Ruthvika Shivani Gadde bagged the Gold Medal at the South Asian Gamesheld during the month of February 2016 at Guwahati defeating PV. Sindhu in the finals.Our leading Chess player P Harikrishna continued to be the second highest Indian in theWorld Chess rankings behind the legendary chess player Vishwanathan Anand. At one pointof time during the year Harikrishna even upstaged Anand to be the highest ranked Indianin the World.
In Archery Atanu Das has been performing exceptionally well and was even ranked No 1in the country. Individual sportspersons from BPCL who have already qualified for the RioOlympics are Saina Nehwal Jwala Gutta and P V. Sindhu in Badminton and Soumyajit Ghosh inTable Tennis. Our young Scholarship players excelled in National and International eventsin the open and junior categories. BPCL also bagged the Second Runners-up"President's Trophy" of Petroleum Sports Promotion Board (PSPB) during the year2015-16.
We continue to support sportspersons through various support mechanisms such asproviding financial assistance for International events assistance towards coachingencouraging their performances through defined Cash Awards and supporting young andpromising players by providing scholarships. It has been our endeavour to promote sportsand sportspersons and be a facilitator for enabling them to excel at National andInternational levels.
RESERVATION AND OTHER WELFARE MEASURES FOR SCHEDULED CASTES/SCHEDULED TRIBES/ OTHERBACKWARD CLASSES AND PERSONS WITH DISABILITIES
The Presidential Directives and other guidelines issued from time to time by Ministryof Petroleum & Natural Gas Ministry of Social Justice and Empowerment and theDepartment of Public Enterprises relating to reservations/concessions for ScheduledCastes/ Scheduled Tribes/Other Backward Classes are being followed meticulously in letterand spirit. We have put in place a robust monitoring mechanism for sustained and effectivecompliance uniformly across the Organisation. As per the Directives the Company maintainsRosters which are regularly inspected by the Liaison Officer of the Corporation as well asthe Liaison Officer of MoP&NG to ensure proper compliance.
The Company encourages SC/ST and economically backward students by awardingscholarships to pursue courses at the Industrial Training Institute and secondary schooleducation up to graduation level.
The provisions under "The Persons with Disabilities (Equal OpportunitiesProtection of Rights and Full Participation) Act 1995 relating to providing employmentopportunities for Persons with Disabilities (PWDs) are fully complied with.
Details relating to representation/appointment of SC/ ST/OBC candidates and Personswith Disabilities are enclosed as Annexure C.
IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY
The Official Language Implementation Committees perform the task of reviewing theprogress made in Official Language Implementation on a quarterly basis. The Committeestake decisions based on the annual programme issued by Ministry of Home Affairs besidesthe provision of the Official Language Act and Rules. They functions at the CorporateRegional Refinery Area Level and major location levels.
The First Sub-Committee of the Parliamentary Committee on Official Language inspectedthe offices situated at Meerut Kolkata Lucknow Hyderabad Guwahati and Jodhpur whereasthe Draft & Evidence Committee visited Kochi on 11.01.2016. The Committees appreciatedthe overall work done so far with regard to Official Language Implementation.
Officials from Department of Official Languages Ministry of Petroleum & NaturalGas visited Roorkee LPG Plant Hyderabad LPG Plant Jaipur LPG Plant Patna Loni DispatchUnit Chennai Udaipur LPG Plant Chandigarh Rajkot and Ahmedabad Territory and our HeadOffice at Mumbai.
Rajbhasha Vibhag of Ministry of Home Affairs inspected 11 locations on an all Indiabasis. The efforts taken by BPCL for promotion of Hindi were appreciated by thecommittees. Hindi fortnight was celebrated at all major locations during the month ofSeptember 2015 various Hindi competitions wing organized. In line with the directives ofMoP&NG a certificate was given to such staff who had done excellent job in HindiImplementation from all Regions/Refineries as Rajbhasha Gourav Puraskar. World Hindi Daywas celebrated on 10th January 2016 across all Regions and Refineries.
At all BPCL Offices Hindi Unicode supported Software Indic Language was loaded.Besides for on-line training of Hindi ISM V6 software/Indic Language Software a web pagehas also been developed.
BPCL bagged the 1st Rajbhasha Protsahan Cup prize from MoP&NG for bestHindi Implementation among PSUs. The Annual Program of Official Language implementationfor the year 2015-16 was conducted with our C&MD issuing annual check points.
Our 72 offices have been notified under sub-rule 10(4) of Official Language Rules 1976during the year on an All India basis. The total number of offices notified till date is114. All the Regional/Refinery Hindi Cells have supported the activities of the TownOfficial Language Implementation Committees. A tribute was paid to Dr. APJ Abdul Kalam on15th August 2015 through a short Hindi film.
A total of 231 children of our employees were give Rajbhasha Awards for securing morethan 60% in Hindi in the 10th/12th standard 24 Hindi workshop and 76Hindi Indic software training programs were organized during the year. Hindi Co-ordinatorsConferences were organized by all Regions/Refineries during the year.
Swachh Bharat Abhiyan Month was organized in Hindi. Gandhi Ek Andhi wasalso enacted in-house.
CITIZENS CHARTER AND PUBLIC GRIEVANCES REDRESSAL
BPCL has constantly endeavoured to set new benchmarks in customer service standardsthereby meeting customer expectations. The Citizen's Charter published by BPCL which isavailable on our Corporate Website in both Hindi and English versions specifies thecustomer rights with respect to standards quality and time-frame for service deliveryprovides insights into the range of products and services offered to our customers andgives an overview of the marketing activities of the Corporation highlighting the policyguidelines and processes on marketing of petroleum products. The Citizens Charterextensively covers the Grievance Redressal Structure set-up in BPCL with details of NodalOfficers spread across States/UTs to help in speedy resolution of customer complaints. Itis updated periodically to be in consonance with the customer expectations businessrequirements and policy changes. The Citizens Charter can be accessed at our websitewww.bharatpetroleum.in.
The Grievance Redressal framework in BPCL transcends across business units andcomplaints resolution is continuously monitored from the Corporate Office. The grievancesreceived on the web-based Public Grievances Portal "Centralized Public Grievance andMonitoring System" (CPGRAMS) of Government of India (under the Department ofAdministrative Reforms & Public Grievances for all Government offices and PSUs) areattended to and resolved/redressed by the Nodal Officers for Grievance Redressal inStates/UTs. During the year we received 4323 grievances on this portal. Timelyresolution of these cases was possible due to a robust redressal framework and monitoringsystem.
BPCL has its own centralized Customer Care System (CCS) - "SmartLine" aweb-based platform that has made it possible for customers to connect directly to BharatPetroleum and its network. The "SmartLine" where customers can log complaintssuggestions and feedback either through BPCL website or by calling up a toll-free numberis designed to track all interactions with the customer and facilitates complaintsredressal well within the stipulated time frame. The built-in escalation matrix in thesystem helps timely redressal of complaints.
The Right to Information is an extremely important authority for any citizen of ademocratic Nation. The RTI Act came into force effective 2005 and BPCL has effectivelyimplemented the same from the beginning. In order to effectively respond to the RTIqueries and appeals addressed to BPCL we have 88 Central Public Information Officers(CPIO) and 11 Appellate Authorities (AA) spread across the country. BPCL has developed anin-house RTI package where all the applications are logged monitored and replied withinthe stipulated time. Continuous training programmes and workshops for CPIOs/AAs Officialsacross the Organisation are being carried out and they are sensitized/updated on allaspects of the Act. Regular circulars newsletters guidelines case studies and CentralInformation Commission (CIC) Judgements are communicated from the Corporate Office to thefield. We also ensure that CIC Decisions are fully complied with. In our corporatewebsite we have a separate section dedicated for RTI.
During the year 2015-16 we have received 3896 RTI queries and responded to all intime. BPCL has organized 6 RTI Works ho ps/training programmes for the new/ existing CPIOsand AAs to stress on the importance of RTI and equip them to handle RTI in true spirit.
MICRO & SMALL ENTERPRISES BPCL has been fully abiding with the PublicProcurement Policy for Micro and Small Enterprises (MSEs) Order and 20% of our annualgoods and service procurements are done through MSEs. The "Purchase PreferenceClause" for MSEs has been incorporated in the "General Purchase Conditions"of all the tenders. As per the existing Purchase Preference Policy of the Government ofIndia the job is awarded to MSE vendors provided they quote within a price band of L1+15% and bring down the price to L1 price. In such a case MSE vendors are allowed to supplya total of at least 20% of the tendered value and in case there is more than one such MSEthe supply is shared proportionately. Additionally 20% of this 20% portion i.e. 4% of thetotal tender quantity is reserved for SC/ST entrepreneurs in the MSE category.
BPCL had put up a MSE procurement plan for 2015-16 on its website. It can be viewed at
All India Premier Vendor Workshop was held during November 2015 in Mumbai which wasattended by MSE vendors with special sessions on MSE policies/guidelines being conducted.
BPCL has achieved 23.06% procurement through MSEs for the year 2015-16 as against thetarget of 20%. The total procurement value for BPCL where MSEs could have participated isRs. 5434.08 crores and the actual value procured from MSEs is Rs. 1253.30 crores.
Vigilance is an integral part of good governance in any organisation. PreventiveVigilance - a step ahead is a proactive and continuously evolving process that utilisesglobal historical wisdom to anticipate vulnerabilities and recommends systemic measures toensure minimum possibilities of their occurrence under all possible circumstances.
This also involves outlining of factors like susceptibility sensitivity and visibilityof all involved processes and subject these to a system of continuous and consistentonline appraisal thereby throwing up regular alarms and cautions for any abnormalindications to alert system operators while maintaining an indelible and easily traceablelog of all activities and interventions for future studies.
Vigilance assists in identification of susceptible areas in existing procedures andprocesses by carrying out system studies Chief Technical Examiner type inspections forhigh value projects scrutiny of tender files and inspections of operating locationsretail outlets and LPG distributorships.
In order to have all the CVC circulars and guidelines readily available for all thestakeholders of the Company for their ready reference a Compendium of CVC circulars andguidelines was compiled and distributed to all stakeholders within the Corporation.
Due to the consistent efforts of CVO comprehensive guidelines for procurement andcontracting procedures were compiled and drafted by the stakeholders after detaileddeliberations. The team comprised officials from Mumbai and Kochi Refinery ChiefProcurement Officer - Marketing and Refinery and Finance Department under the leadershipof Director (Refineries). These comprehensive guidelines cover the procedures to befollowed by the Businesses and Entities for their requirement of procurement of goodscontracts and services. In a nutshell a common comprehensive guideline has beeninstitutionalized.
Vigilance Officers have conducted Vigilance Awareness sessions for our employeesworking at operating locations and regional offices during their visits aimed atenhancing knowledge and awareness on the operational aspects of various guidelines andstandard operating procedures in vogue.
In order to increase visibility and transparency in our interactions with vendorscontractors suppliers and other service providers it was ensured that all tenders arebeing published on the Central Public Procurement (CPP) portal of the Government of Indiawebsite. Corporate Vigilance also carried out thorough investigations into complaints andsource information. Complaints including those received online were investigated bothdirectly by Team Vigilance and through Businesses/Entities within the stipulated timeframe. BPCL's internal website "Intralink" as well as Vigilance portalavailable on BPCLs corporate website has the provision to lodge complaints as well asprovide a platform for regular interaction with employees customers and others concerned.
The Vigilance portal creates awareness on good governance shares knowledge on ethicalpractices and proactive vigilance and acts as a powerful tool to connect all theemployees. This website also provides useful links of Central Vigilance CommissionDepartment of Personnel & Training Government of India.
As a part of capacity building Vigilance Officers have undergone a training programmeconducted by Gujarat Forensic Sciences University at Gandhinagar near Ahmedabad. TeamVigilance studied subjects like "Role of Forensic Psychology in Investigation &Prevention of Corruption" and "Forensic Investigative Techniques". GujaratForensic Sciences University is the only university of forensic sciences in the world ason date for research and development of forensic sciences.
C&MD and GM (Vigilance) in the presence of Director (Human Resources) Director(Finance) and other senior BPCL officials and staff administered pledge at BPCL CorporateOffice in Mumbai on 26th October 2015 at at the launch of the VigilanceAwareness Week 2015 from 26.10.2015 to 31.10.2015. Shri Keshav Kumar IPS Joint DirectorCentral Bureau of Investigation Mumbai Zone was the Chief Guest who dwelled upon thelatest developments in forensic sciences.
Similarly Vigilance Awareness Week was launched with administering of the pledge bythe Chief Guest in the presence of senior BPCL Officials in all the four Regions andMumbai and Kochi Refineries Bharat PetroResources Limited and Petronet CCK Limited.During this period various activities such as Awareness Sessions Essay ContestsQuestion Answer Sessions Vigilance Quiz Debate Competition Painting Contest and Skitprogram (topic: Fighting Corruption) were conducted for employees and school children.
Integrity Clubs (IC) were launched in schools in Mumbai and Chennai for propagatingethical values in school children so that they in turn carry these values to theirfamilies friends and society. The members of the club are called Young Champions ofEthics (YCEs). Imparting ethical values shapes the childs attitude towards peopleand society and helps in mental growth in the child and supports his ambitions and values.
"Choti Choti Batein" is a value based teachings initiative to rekindle valuesamongst school children. They were conducted by Vigilance Officers and through thisinitiative we have covered 10 schools in Mumbai and touched around 2000 students fromvarious strata of society.
It was a landmark achievement for BPCL Vigilance to implement Six Sigma. With activesupport from Total Quality Management Department Mumbai Refinery has started the journeyof Lean Six Sigma. The Corporate team underwent the training and the process helped themto standardise the formats for scrutiny of tenders and Annual Property Returns. With thisBPCL Vigilance becomes the first department amongst Public Sector Undertakings toimplement Lean Six Sigma.
A special Journal "Vigilance Plus "was released to all stakeholders tocommemorate the activities carried out during Vigilance Awareness Week 2015 and otherevents conducted by Vigilance department. Staff members across the country contributedarticles in this magazine by narrating their experiences.
Vigilance is an important instrument available to the management for improving theoverall performance of the organization as it promotes transparent business transactionsprofessionalism productivity promptness and ethical practices. It also assists insystemic improvements curbing possibilities for corruption. Therefore PreventiveVigilance helps in improving efficiency and effectiveness of the personnel as well as theorganization.
SUBSIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES
The Group consists of 5 Indian Subsidiaries and 4 Foreign Subsidiaries as on 31stMarch 2016. Further the Company has 19 Associate Companies including Joint VentureCompanies within the meaning of Section 2(6) of the Companies Act 2013 (theAct).
A separate statement containing the salient features of the financial statement ofSubsidiaries/Associates/Joint Venture Companies in Form AOC-1 pursuant to provisions ofSection 129(3) of the Act is attached along with the financial statement.
The Company has placed its financial statements including consolidated financialstatements and all other documents required to be attached thereto on its website
The policy for determining material subsidiaries is posted on the Companyswebsite at the link https://bharatpetroleum.com/About-BPCL/Our-Policies.aspx
The performance of Subsidiaries/Associates/Joint Ventures and their contribution tooverall performance of the Company and financial position are provided in Note No. 50 ofthe Consolidated Financial Statements forming part of this Annual Report.
SUBSIDIARY COMPANIES Numaligarh Refinery Limited (NRL)
NRL was incorporated in the year 1993 with an authorised share capital of Rs. 1000crores. The paid up share capital of NRL as on 31st March 2016 was Rs. 735.63crores of which BPCL holds 61.65%. NRL is a Category-I Miniratna PSU and operates a 3MMTPA Refinery at Numaligarh in Assam. Besides the Refinery NRL has two marketingterminals one at Numaligarh and the other at Siliguri for evacuation of products. NRLalso has a 10 TMTPA LPG Bottling Plant at Numaligarh.
NRLs crude throughput during 2015-16 was 2.52 MMT against 2.78 MMT in the lastyear. Capacity utilization was restricted to 84.0% compared to 92.5% in the previous year.In 2015-16 NRLs distillate yield at 90.4% was the highest among PSU oil refineries in thecountry. This has been the fifth consecutive year of such an achievement recorded by NRL.During 2015-16 Specific Energy Consumption was at 50.4 MBN among the best in theindustry. Energy Intensity Index (EII) during the year was recorded at 96.6 marking animprovement over previous years EII of 97.2.
During the year NRL added two new products to its portfolio viz. paraffin wax andnitrogen and exported HSD to Bangladesh and paraffin wax to Nepal.
The Financial Year ended 31st March 2016 saw NRLs Revenue from Operationsreaching Rs. 10031.44 crores in comparison to Rs. 9862.42 crores in the previous yearmarking an increase of 1.7%. NRLs profit before tax for the year 2015-16 increased by 66%to reach Rs. 1882.38 crores as compared to Rs. 1133.94 crores in the previous year. TheCompanys profit after tax for the year was Rs. 1224.35 crores against Rs. 719.74crores in 2014-15. The increase in profits is mainly attributable to high distillateyield lower energy consumption and enhanced operational efficiency. Earnings per shareincreased to Rs. 16.64 from Rs. 9.76 in the previous year. The Company paid an interimdividend @ Rs. 3.50 per fully paid equity share of Rs. 10/- each. The Board alsorecommended a final dividend of Rs. 3.50 per share for the Financial Year 2015-16. NRLpaid dividend of Rs. 4.00 per share in the previous year.
As on 31st March 2016 NRL shareholders funds was recorded at Rs.3963.87 crores as against Rs. 3354.98 crores in the previous year and its book value pershare increased to Rs. 53.88 from Rs. 45.67 in the previous year.
Bharat PetroResources Limited (BPRL)
BPRL was incorporated in the year 2006 as a wholly owned Subsidiary Company of BPCLwith the objective of implementing BPCLs plans in the upstream exploration andproduction sector.
As on 31st March 2016 BPRL has an authorized share capital of Rs. 3000crore and paid up share capital of Rs. 2920 crore which is entirely held by BPCL theHolding Company. BPRL has incurred a consolidated loss of Rs. 248.31 crore for theFinancial Year ending 31st March 2016. The consolidated loss was due torelinquishment of participating interest (PI) in few blocks as prospectively assessedbased on drilling results in these blocks was very poor.
The operations of BPRL are carried out through Subsidiaries and Joint Ventures bothincorporated and unincorporated in India and abroad. BPRL currently has PI in seventeenblocks spread across six countries. Out of these blocks seven blocks are located inIndia which were acquired under different rounds of New Exploration Licensing Policy(NELP) and ten blocks are located overseas. Most of the blocks are in advanced stages ofexploration appraisal and pre-development. The total area of these seventeen blocks isaround 24375 sq km of which approximately 88% is offshore acreage.
BPRL has a wholly owned Subsidiary Company BPRL International BV in the Netherlandswhich in turn has three wholly owned Subsidiary Companies viz. BPRL Ventures BV BPRLVentures Mozambique BV and BPRL Ventures Indonesia BV. BPRL Ventures BV has a 50% stakein IBV Brasil Petroleo Limitada which currently holds PI ranging from 20% to 40% in sixblocks in offshore Brazil. BPRL Ventures Mozambique BV has PI of 10% in a block inMozambique and BPRL Ventures Indonesia BV holds PI of 12.5% in a block in Indonesia.Further BPRL has a wholly owned Subsidiary Company Bharat PetroResources JPDA Limited inIndia which holds a PI of 20% in Block-JPDA 06-103 in Timor Leste. The PIs in blocks inBrazil Mozambique Indonesia and Timor Leste are held through these Subsidiaries.Further the PI in respect of blocks in India and Australia are held by BPRL along withother consortium members.
BPRL and its consortia have a total of 22 discoveries in respect of blocks held in fivecountries i.e. Brazil Mozambique Indonesia Australia and India.
Recently as concrete steps towards fulfillment of its aspiration for revenuegeneration BPRL has signed definitive agreements to acquire stakes in Companies in Russiawhich have oil & gas producing assets in their portfolio. Subsequently in May 2016BPRL has formed another wholly owned Subsidiary Company i.e. BPRL International SingaporePte Ltd in Singapore for enabling the acquisition of stakes in the Companies in Russia.Further BPRL International Singapore Pte Ltd has formed two Joint Venture Companies asSpecial Purpose Vehicles (SPV) i.e. Taas India Pte Ltd and Vankor India Pte Ltd in May2016 along with Oil India Ltd and Indian Oil Corporation Ltd with BPRL InternationalSingapore Pte Ltd holding 33% stake in each of the two SPVs to hold stakes in theCompanies in Russia.
Petronet CCK Limited (PCCKL)
BPCL had a 73.96% stake in the equity capital of PCCKL a Joint Venture Companypromoted with Petronet India
Limited with a paid up share capital of Rs. 100 crores. PCCKL has become a subsidiaryin May 2015 and later in July 2016 it has become a wholly owned Subsidiary Company ofBPCL. The Company owns and operates the 292 km long multi-product Kochi-Karur pipelinefrom BPCLs installation of Irimpanam to Karur for transportation of MS HSD and SKO. Thepipeline commenced commercial operations from September 2002.
During the year 2015-16 the pumping volume amounted to 2.72 MMT in comparison to the2.46 MMT of the previous year. PCCKL recorded revenue from operations of Rs. 107.78 croresand net profit of Rs. 59.41 crores for the Financial Year ending 31st March2016 corresponding to Rs. 98.27 crores and Rs. 42.96 crores respectively in the previousyear.
BPCL-KIAL Fuel Farm Private Limited (BKFFPL)
BPCL has signed a Joint Venture Agreement with KIAL (Kannur International Airport Ltd)for implementation of a Fuel Farm at the newly developed Kannur International Airport atKannur on a 74:26 equity basis. The Company has been incorporated on 18th May2015 and the authorized capital of the Company is Rs. 18 Crores. As of now BPCL has made acontribution of Rs. 4.44 crores to BPCL-KIAL.
JOINT VENTURE COMPANIES Bharat Oman Refineries Limited (BORL)
Bharat Oman Refineries Limited is a Joint Venture Company of BPCL with Oman Oil CompanyS.A.O.C. (OOC). BPCL and OOC have an equity stake of 50% each in BORLs paid up sharecapital of Rs. 1777.23 crores as on 31st March 2016. BPCL has also subscribedto Share Warrants of BORL of Rs. 1585.68 crores. Further the State of Madhya Pradesh hasalso subscribed to Rs. 26.90 crores of Share Warrants in BORL.
During the year 2015-16 Bina Refinery processed 6.40 MMT of crude oil achieving acapacity utilization of 107% as compared to 103% in the previous year. This is thehighest capacity utilization achieved since commencement of operations in June 2011.
During the year 2015-16 BORL has achieved sales of 6.13 TMT as against 5.59 TMT inthe previous year. The Company has reported Gross Revenue from Operations of Rs. 26028crores in the year 2015-16 as compared to Rs. 29331 crores in the corresponding year.The decrease in revenue is on account of the fall in prices of petroleum products.
The GRM for the year 2015-16 stood at USD 11.7 per barrel with an overall gross marginof Rs. 3526 crores. The previous year's GRM was of USD 6.1 per barrel with an overallgross margin of Rs. 1681 crores. The net profit after tax was registered at Rs. 366crores during the year 2015-16 as compared to a net loss of Rs. 790 crores in theprevious year. This is the first time that BORL has recorded a profit.
The Company has launched a project for low cost de-bottlenecking of its existingfacilities to enhance its current capacity to 7.8 MMTPA in the next 3 years and also tomeet product quality specifications as stipulated in the Auto Fuel Vision and Policy 2025guidelines. Basic engineering and design work for the process units has been completed anddetailed engineering of open-art as well as licensed units has commenced.
Petronet LNG Limited (PLL)
PLL was formed in April 1998 for importing LNG and setting up LNG terminals withfacilities like jetty storage regasification etc. to supply Natural Gas to variousindustries in the country. The Company has an authorised capital of Rs. 1200 crores andpaid up capital of Rs. 750 crores. PLL was promoted by four public sector companies viz.BPCL Indian Oil Corporation Limited (IOC) Oil and Natural Gas Limited (ONGC) and GAIL(India) Limited (GAIL). Each of the promoters holds 12.5% of the equity capital of PLL.PLL is a listed Company. BPCLs equity investment in PLL currently stands at Rs. 98.75crores. As at 31st March 2016 PLL had a consolidated net worth of Rs.6424.47 crore.
During the year 2015-16 PLL registered a consolidated Revenue from Operations of Rs.27222.95 crores as against Rs. 39626.97 crores reported in 2014-15. The Company's netprofit for the year is at Rs. 928.53 crores against Rs. 904.80 crores in the last year. Itrecorded an EPS of Rs. 12.39 during the year under review as against EPS of Rs. 12.06 in2014-15. The PLL Board has recommended dividend of Rs. 2.50 per share for the FinancialYear 2015-16 against Rs. 2.00 per share paid last year.
Indraprastha Gas Limited (IGL)
IGL a Joint Venture Company with GAIL as the other co-promoter was set up inDecember 1998 with an authorised capital of Rs. 220 crores for implementing the projectfor supply of Compressed Natural Gas (CnG) to the household and automobile sectors inDelhi. The paid up share capital of the Company is Rs. 140 crores. BPCL invested Rs. 31.50crores in IGL for 22.5% stake in its equity. IGL is a listed Company with the publicholding 55% of the paid up share capital of the Company. IGL has commissioned over 340 CNGstations which supply environment friendly fuel to more than 800000 vehicles. IGL hasmore than 636618 domestic PNG customers in Delhi. The Company is also extending itsbusiness to the towns of Greater Noida and Ghaziabad. IGL has acquired 50% of the equityheld by the financial institutions in Central UP Gas Limited and Maharashtra Natural GasLimited Joint Venture Companies promoted by BPCL and GAIL.
During the year 2015-16 IGL has posted Revenue from Operations of Rs. 4064.21 croresand a profit after tax of Rs. 416.20 crore as against the figure of Rs. 4059.64 croresand Rs. 437.73 crores respectively in the corresponding previous year. IGL has maintaineda dividend of Rs. 6.00 per share for the year as was paid in the previous year. IGLsshareholders funds were Rs. 2413.23 crores as at 31st March 2016.
Sabarmati Gas Limited (SGL)
SGL a Joint Venture Company promoted by BPCL and Gujarat State Petroleum Corporation(GSPC) was incorporated on 6th June 2006 with an authorized capital of Rs.100 crores for implementing the City Gas distribution project for supply of CNG to thehousehold and automobile sectors in the city of Gandhinagar Mehsana and SabarkanthaDistricts of Gujarat. The paid up share capital of the Company is Rs. 20 crores.
As at 31.3.2016 BPCL has a stake of 49.94% in the equity capital of SGL. SGL has setup 38 CNG stations. Revenue from Operations of SGL for the Financial Year ending 31stMarch 2016 was Rs. 720.08 crores and net profit was ' 0.97 crores against the previousyear's figure of Rs. 905.71 crores and Rs. 110.84 crores respectively. The proposeddividend on equity shares by the Company was at the rate of Rs. 1.00 per share for theFinancial Year ending 31st March 2016 against the dividend of Rs. 2.50 pershare for the Financial Year ending 31st March 2015. To compete with alternatefuel and retain customers the Company had introduced a Minimum Guarantee Offtake (MGO)contract at reduced Retail Selling Price (RSP) to Industrial customers from April 2015onwards. Major Industrial Volume is under the MGO contract and RSP of the same is reducedas compared to the previous year thereby adversely impacting the Sales value and alsoprofit.
Central UP Gas Limited (CUGL)
CUGL is a Joint Venture Company set up in March 2005 with GAIL as the other partnerfor implementing the project for supply of CNG to the household industrial and automobilesectors in Kanpur and Bareilly in Uttar Pradesh. The Company was incorporated with anauthorised share capital of Rs. 60 crores. The Joint Venture partners have each investedRs. 15 crores for an equity stake of 25% each in the Company. Indraprastha Gas Ltd ourjoint Venture is holding the balance 50%. CUGL has set up 16 CNG stations and is carryingon PNG operations. Revenue from Operations of CUGL was Rs. 200.61 crores and net profitwas Rs. 32.61 crores for the Financial Year ending 31st March 2016. In theprevious year its Revenue from Operations was Rs. 186.81 crores and net profit was Rs.27.52 crores. The EPS for the year was at Rs. 5.44 as against Rs. 4.59 in 2014-15. TheBoard of Directors has recommended payment of dividend at Rs. 1.40 per share for thecurrent year which is the same as that of the previous year.
Maharashtra Natural Gas Limited (MNGL)
MNGL was set up in January 2006 as a Joint Venture Company with GAIL for implementingthe project for supply of Natural Gas to the household industrial and automobile sectorsin Pune and its nearby areas. The Company was incorporated with an authorised sharecapital of Rs. 100 crores. The paid up capital of the Company is Rs. 100 crores. BPCL andGAIL have invested Rs. 22.50 crores each in MNGLs equity capital. MIDC as a nominee ofthe Maharashtra Government has taken 5% equity in the month of June 2015. Balance 50% isbeing acquired by IGL our Joint Venture Company from financial institutions. The Companyhas set up 30 CNG stations so far.
During the year 2015-16 MNGL reported net revenue of Rs. 464.78 crores and profit ofRs. 75.20 crores as against the revenue of Rs. 458.52 crores and profit of Rs. 50.58 crorein the last year. The MNGL Board has recommended a dividend of Rs. 1.50 per equity sharefor the Financial Year ending 31st March 2016 as against Rs. 1.02 per sharedeclared in the last year.
Bharat Stars Services Private Limited (BSSPL)
BSSPL a Joint Venture Company promoted by BPCL and ST Airport Pte Limited Singaporewas incorporated in September 2007 for providing into plane fueling services at the newBengaluru International Airport. The authorised and paid up share capital of BSSPL is Rs.20 crores.
The two promoters have each subscribed to 50% of the equity share capital of BSSPL andBPCLs present investment stands at Rs. 10 crores. The Company commenced itsoperations at the new international airport in Bengaluru from May 2008 and has alsoincorporated a wholly owned subsidiary Bharat Stars Services Pvt. (Delhi) Ltd. forimplementing into plane fuelling services exclusively at the new T3 Terminal of DelhiInternational Airport.
BSSPL provides Into Plane (ITP) Services at three Open Access airports-BengaluruMumbai and Delhi T3. BSSPL has taken over the complete Operatorship of 2 AFSs ofBPCL - Jaipur and Durgapur. It also provides ITP services to BPCL at Calicut Chennai andDelhi T-1 airports.
During the year 2015-16 BSSPL has posted a revenue of Rs. 29.53 crores and profit ofRs. 2.89 crores in comparison to a revenue of Rs. 17.15 crores and profit of Rs. 2.01crores in the last year. The Board has recommended a dividend of ' 0.25 per equity sharefor the Financial Year ending 31st March 2016 which was the same as theprevious year.
Bharat Renewable Energy Limited (BREL)
BREL was incorporated on 17th June 2008 for undertaking the productionprocurement cultivation and plantation of horticulture crops such as karanj jathrophaand pongamia trading research and development and management of all crops and plantationincluding Biofuels in the State of Uttar Pradesh with an authorized capital of Rs. 30crores. The Company has been promoted by BPCL with Nandan Cleantech Limited (erstwhileNandan Biomatrix Limited) Hyderabad and the Shapoorji Pallonji group through theiraffiliate S.P Agri Management Services Pvt. Ltd.
Due to non-viability the operations of this Company have been closed down fromSeptember 2014 and Company Petition No 5 of 2014 was filed before the Honble HighCourt of Allahabad (Lucknow Bench) for winding up of BREL. By Order dated 21.12.2015 Mr.Justice Devendra Kumar Upadhyaya ordered that the Company be wound up and instructed theOfficial Liquidator to proceed in accordance with the provisions of the Companies Act.
Matrix Bharat Pte. Limited (MXB)
MXB is a Joint Venture Company incorporated in Singapore in the year 2008 for carryingon the bunkering business and supply of marine lubricants in the Singapore market as wellas international bunkering. The Company has been promoted by BPCL and Matrix Marine FuelsL.P USA an affiliate of the Mabanaft group of Companies Hamburg Germany. BPCL hassubscribed 20 lakh shares for an equivalent sum of Rs. 8.41 crores. The other partner hascontributed equally to the share capital. Matrix Marine Fuels LP USA has subsequentlytransferred their share and interest in the Joint Venture in favour of Matrix Marine FuelsPte Limited Singapore another affiliate of the Mabanaft group.
MXB has posted a revenue of USD 221.82 million and earned a profit of USD 1.47 millionfor the year ending 31.12.2015 as compared to a revenue of USD 636.38 million and aprofit of USD 1.62 million in the previous year. Turnover has dropped by 65% in 2015mainly due to the steep drop in fuel oil price in the international market coupled withlower volume during the year.
Petronet India Limited (PIL)
BPCL has 16% equity participation with an investment of Rs. 16 crores in PIL which wasformed as a non-government financial holding Company to give impetus to the development ofa pipeline network throughout the country. PIL has facilitated pipeline access on a commoncarrier principle through Joint Ventures for pipelines put up by them viz.Vadinar-Kandla Kochi- Coimbatore-Karur and Mangalore - Hassan - Bangalore. PIL registeredother income of Rs. 14.08 crores and a net profit of Rs. 13.72 crores for the FinancialYear ending 31st March 2016 as against other income of Rs. 1.54 crores and anet profit of Rs. 1.14 crores in the previous year.
The changes in pipeline policy have affected the future of the Company as interestedCompanies are permitted to undertake pipeline projects. PIL does not have any new projectsin hand and is considered not viable. PIL has recently sold its 26% share in Petronet CCKLtd to BPCL. Accordingly the process of divesting PILs 26% equity in the balancetwo Joint Venture Companies promoted by it is in progress. The Company would be wound upthereafter.
Delhi Aviation Fuel Facility Private Limited (DAFFPL)
DAFFPL has been promoted by BPCL IOCL and Delhi International Airport Limited (DIAL)in the year 2009 for implementing Aviation Fuel facility for the new T3 terminal at DelhiInternational Airport. The paid up share capital of the Company is Rs. 164 crores. BPCLand IOCL each have subscribed to 37% of the share capital of the Company while thebalance is held by DIAL.
DAFFPL has posted a revenue of Rs. 110.85 crores and net profit of Rs. 37.55 crores forthe Financial Year ending 31st March 2016 in comparison to the revenue of Rs.96.04 crores and net profit of Rs. 26.58 respectively in the last year. The Board hasrecommended a dividend of Rs. 1.80 per share for the Financial Year ending 31stMarch 2016 as against Rs. 1.25 per equity share declared in the previous year.
Kannur International Airport Limited (KIAL)
Kannur International Airport Ltd (KIAL) was promoted by the Government of Kerala toestablish and operate airports and allied infrastructure facilities at Kannur and otherparts of India. KIAL would initially set up an Airport at Kannur in the State of Kerala atan estimated project cost of Rs. 1892 crores of which Rs. 1000 crores will be financedthrough equity and the balance sum of Rs. 892 crores will be financed by borrowings. Thepaid up share capital of the Company as at 31.03.2016 is Rs. 864.76 crores.
BPCL has made a contribution of Rs. 170 crores out of the total contribution committedamounting to Rs. 216.80 crores for 21.68% equity stake in the Company.
GSPL India Transco Limted
BPCL has signed a Joint Venture Agreement in 30th April 2012 with GujaratState Petronet Ltd. IOCL and HPCL for laying of 1747 km for theMallavaram-Bhopal-Bhilwara- Vijaipur (MBBVPL) gas pipeline. BPCLs equitycontribution to this project will be 11% of the total equity capital. The other JointVenture (JV) partners will contribute GSPL 52% IOCL 26% and HpCL 11%. BPCL has made aninitial contribution of Rs. 18.15 crores so far. The Company is in the process ofacquiring the Right of Way.
The Company had reported a miscellaneous income of Rs. 1.30 crores and net profit of '0.87 crores during the Financial Year 2015-16. The previous year income was Rs. 2.17crores and net profit was Rs. 1.47 crores.
GSPL India Gasnet Limited
BPCL has signed a Joint Venture Agreement on 30th April 2012 with GujaratState Petronet Ltd. IOCL and hPcl for laying of the gas Pipeline Mehsana-Bhatinda (MBPL)(Pipeline length 1654 km) and Bhatinda-Jammu-Srinagar (BJSPL) (Pipeline length 460 kms).BPCLs equity contribution to this project will be 11% of the total equity capital. Theother JV partners will contribute GSPL 52% IOCL 26% and HPCL 11%. BPCL has made an equitycontribution of Rs. 23.32 crores so far.
During the Financial Year 2015-16 the Company had reported a miscellaneous income ofRs. 1.74 crores and net profit of Rs. 1.16 crores against the income of Rs. 1.89 croresand profit of Rs. 1.28 crores for the previous year. Mumbai Aviation Fuel Farm FacilityPrivate Limited (MAFFFPL)
BPCL with IOCL HPCL and Mumbai International Airport Ltd. (MIAL) entered into a JointVenture for implementing and managing fuel farm facilities at Mumbai Airport and formedMumbai Airport Fuel Farm Facility Pvt. Ltd. (MAFFFPL) with equal participation of 25%each. Presently BPCL has invested an amount of Rs. 38.27 crores towards equity. TheCompany has started its operations from 1st February 2015.
MAFFPL recorded a turnover of Rs. 112.12 crores and net profit of Rs. 17.94 crores forthe year ending 31.03.2016 in comparison to Rs. 19.77 crores and net loss of Rs. 11.01crores for the previous Financial Year ending 31st March 2015.
Kochi Salem Pipeline Private Limited (KSPPL)
BPCL has signed a Joint Venture Agreement with IOCL for implementation of theKochi-Coimbatore-Salem LPG pipelines project and formed a Joint Venture Company viz.KSpPl in January 2015 on a 50:50 basis. BPCLs equity investment in the Company currentlystands at Rs. 40 crores.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under Regulation 34(2)(e) ofSEBI (Listing Obligations and Disclosures Requirement) Regulations 2015 is presented in aseparate section forming part of the Annual Report. The forward looking statements made inthe Management Discussion and Analysis Report are based on certain assumptions andexpectations of future events. The Directors cannot guarantee that these assumptions areaccurate or these expectations will materialize.
CONSERVATION OF ENERGY RESEARCH AND DEVELOPMENT TECHNOLOGICAL ABSORPTION AND FOREIGNEXCHANGE EARNINGS AND OUTGO The particulars as prescribed under Sub-Section (3)(m) ofSection 134 of the Companies Act 2013 read with the Companies (Accounts) Rules 2014 areenclosed as Annexure A to the Directors' Report.
MEMORANDUM OF UNDERSTANDING WITH MINISTRY OF PETROLEUM & NATURAL GAS
BPCL has been entering into a Memorandum of Understanding (MOU) with the Ministry ofPetroleum & Natural Gas every year since 1990-91. BPCL has also been achieving an"Excellent" performance rating every year since then.
BPCL has won the "MOU Excellence Award' for the best MoU score in the Petroleumsector in 1998-99 2000-01 2002-03 and 2006-07. During 2013-14 and 2014-15 also BPCL gotthe highest MoU score in the petroleum sector.
As per Ministry of Corporate Affairs Notification dated 5th June 2015provisions of Section 134(3)(p) shall not apply in case the Directors are evaluated by theMinistry which is administratively in charge of the Company as per its own evaluationmethodology. Bharat Petroleum Corporation Ltd. being a Government Company the performanceevaluation of the Directors is carried out by the Administrative Ministry (MoP&NG)Government of India as per applicable Government guidelines.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
As per MCA Notification dated 5th June 2015 provisions of Section134(3)(e) are not applicable to a Government Company. Consequently details on Company'spolicy on Directors' appointment and other matters are not provided under Section 178(3).
Similarly Section 197 shall not apply to a Government Company. Consequentlydisclosure of the ratio of the remuneration of each Director to the median employee'sremuneration and other such details including the statement showing the names and otherparticulars of every employee of the Company who if employed throughout/part of theFinancial Year was in receipt of remuneration in excess of the limits set out in theRules are not provided in terms of Section 197(12) read with Rule 5(1)/(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The Chairman & Managing Director and the Whole-time Directors of the Company didnot receive any remuneration or commission from any of its Subsidiaries. BPCL being aGovernment Company its Directors are appointed/nominated by the Government of India asper the Government/DPE Guidelines which also include fixation of pay criteria fordetermining qualifications and other matters.
During the year SEBI notified SEBI (Listing Obligations and Disclosures Requirement)Regulations 2015 (Listing Regulations) effective December 1 2015. In terms of theListing Regulations all listed entities were required to enter into a new listingagreement with the Stock Exchanges. Accordingly the Company has executed new listingagreements with BSE Limited and National Stock Exchange of India Limited.
The Report on Corporate Governance together with the Auditors Certificate oncompliance of Corporate Governance is annexed as Annexure D as required under ListingRegulations and Department of Public Enterprises Guidelines of Corporate Governance forCentral Public Sector Enterprises.
SOCIAL ENVIRONMENTAL AND ECONOMIC RESPONSIBILITIES AND BUSINESS RESPONSIBILITY REPORT
We always strive to improve our disclosures regarding our social and environmentalperformance and the consequent impact on all our stakeholder groups. The Board ofDirectors of the Company has adopted and delegated the implementation of BusinessResponsibility Policy based on the principles of National Voluntary Guidelines on SocialEnvironmental and Economic Responsibilities of Business as issued by the Ministry ofCorporate Affairs Government of India to the Sustainability Committee. Our SustainabilityReport is made in accordance with the Global Reporting Initiative (GRI).
As stipulated under the Listing Regulations the Business Responsibility Reportdescribing the initiatives taken by the Company from the environmental social andgovernance perspective is attached as part of the Annual Report.
TRANSACTIONS WITH RELATED PARTIES
The Company during the Financial Year entered into contracts or arrangements withrelated parties which were in the ordinary course of business and on an arms lengthbasis. These transactions are not falling under the provisions of Section 188(1) of theAct.
Information on transactions with related parties are provided in Annexure F in FormAOC-2 in accordance with Section 134(3) of the Act and Rule 8(2) of the Companies(Accounts) Rules 2014).
In terms of Listing Regulations and Policy of the Company on materiality of relatedparty transactions transaction entered into with Bharat Oman Refineries Limited a JointVenture Company could be considered material. This transaction is being placed forapproval of the shareholders.
The Policy on materiality of related party transactions and dealing with related partytransactions are available on the Companys website at the link
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has provided Loans/Guarantees to its Subsidiaries/Joint Ventures and hasmade Investments in compliance with the provisions of the Companies Act 2013. The detailsof such investments made and loans/guarantees provided as on 31st March 2016are given in the standalone financial statements under Notes 16 48 & 49.
The Risk Management Committee of the Board has a defined roles and responsibilitieswhich includes reviewing and recommending of the risk management plan and reviewing andrecommending the risk management report for approval of the Board with the recommendationby the Audit Committee. The Companys internal financial controls and risk managementsystems are assessed by the Audit Committee. The Company has adopted a Risk ManagementCharter and Policy for self-regulatory processes and procedures for ensuring the conductof the business in a risk conscious manner.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(3)(c)/(5) of the Companies Act 2013 the Directors of theCompany confirm that:
a. In the preparation of the Annual Accounts for the year ended 31st March2016 the applicable Accounting Standards have been followed along with proper explanationrelating to material departures;
b. The Directors have 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 as at 31st March 2016 and ofthe profit and loss of the Company for the year ended on that date;
c. The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d. The Directors have prepared the annual accounts on a going concernbasis;
e. The Directors have laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and operating effectively; and
f. The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and such systems are adequate and operating effectively.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Smt. Sushma Taishete Director (D&MC) Ministry of Petroleum & Natural Gas wasappointed as Director effective from 19.05.2015 and she has ceased to be Director on Boardfrom 02.01.2016.
Prof J.R.Varma and Shri B. Chakrabarti Independent Director ceased to be Directors onthe Board from 10.08.2015.
Shri Rajesh Kumar Mangal Shri Deepak Bhojwani and Shri Gopal Chandra Nanda wereappointed as Additional Directors with effect from 01.12.2015. As they have been appointedas Additional Directors they will hold office till the ensuing Annual General Meeting.Notices under Section 160 of the Act have been received proposing their names forappointment as Directors at the ensuing Annual General Meeting.
Dr. Neeraj Mittal Joint Secretary (Marketing) Directorate General of HydrocarbonsMinistry of Petroleum & Natural Gas ceased to be a Director on the Board from11.12.2015.
Shri Anant Kumar Singh Director Additional Secretary & Financial AdvisorMinistry of Petroleum & Natural Gas was appointed as Additional Director from02.01.2016. As he has been appointed as Additional Director he will hold office till theensuing Annual General Meeting. Notice under Section 160 of the Act has been receivedproposing his name for appointment as Director at the ensuing Annual General Meeting.
Shri K. K. Gupta Director (Marketing) superannuated at the close of office hours on29.02.2016.
Shri S. Ramesh was appointed as Additional Director and as Director (Marketing) witheffect from 01.03.2016. As he has been appointed as Additional Director he will holdoffice till the ensuing Annual General Meeting. Notice under Section 160 of the Act hasbeen received proposing his name for appointment as Director at the ensuing Annual GeneralMeeting.
Shri B.K Datta Director (Refineries) superannuated on 31.07.2016.
Shri R. Ramachandran was appointed as Additional Director and as Director (Refineries)with effect from 01.08.2016. As he has been appointed as Additional Director he will holdoffice till the ensuing Annual General Meeting. Notice under Section 160 of the Act hasbeen received proposing his name for appointment as Director at the ensuing Annual GeneralMeeting.
Shri S. P Gathoo Director (Human Resources) will retire by rotation at the ensuingAnnual General Meeting as per the provisions of Section 152 of the Act and beingeligible has offered himself for re-appointment as Director at the said Meeting.
The Board has placed on record their appreciation of the Directors who have ceased tobe Members of the Board for the valuable contributions made and guidance given for thedevelopment and progress of the Companys business.
As required under the Corporate Governance Clause brief bio-data of the aboveDirectors who are appointed/ re-appointed at the Annual General Meeting are provided inthe AGM Notice.
DECLARATION OF INDEPENDENCE
Independent Directors of the Company have provided declarations confirming that theymeet the criteria of independence as prescribed under the Act.
FAMILIARISATION PROGRAMMES The Company has adopted a policy for the trainingrequirements of Board Members. The details thereof with the programmes sponsored forfamiliarisation of Independent Directors with the Company are available on theCompanys web link https://bharatpetroleum.com/images/files/FPID_new.pdf
The details of the composition of the Audit Committee terms of reference and meetingsheld are provided in the Corporate Governance Report which forms part of this Report.
The Company has implemented the Whistle Blower Policy to ensure greater transparency inall aspects of the Corporations functioning. The objective of the policy is to buildand strengthen a culture of transparency and trust in the Corporation and to provideemployees with a framework/procedure for responsible and secure reporting of improperactivities (whistle blowing) and to protect employees wishing to raise a concern aboutimproper activity/serious irregularities within the Corporation.
The vigil mechanism provides for adequate safeguards against victimisation of personswho use such a mechanism. An employee desirous of making protected disclosures in respectof any of the improper activities may send a communication to the Competent Authority/Chairperson of the Audit Committee in appropriate or exceptional cases. The Companysweb link given below contains details of the establishment of such a mechanism
NUMBER OF MEETINGS OF THE BOARD
Twelve meetings of the Board of Directors were held during the year the details ofwhich are given in the Corporate Governance Report that forms part of this Report. Theintervening gap between the meetings was within the period prescribed under the CompaniesAct 2013 and the Listing Regulations.
EXTRACT OF ANNUAL RETURN
As required under Section 92(3) of the Act the extract of Annual Return of the Companyis annexed herewith in specified Form MGT-9 as Annexure G to this Report.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS
The details are included in the Management Discussion & Analysis Report whichforms part of this Report.
M/s. CNK & Associates LLP Chartered Accountants Mumbai and M/s. Haribhakti &Co. LLP Chartered Accountants Mumbai were appointed as Statutory Auditors for the year2015-16 by the Comptroller & Auditor General of India (C&AG) under the provisionsof Section 139(5) of the Companies Act 2013. The said firms have been appointed as theStatutory Auditors also for the Financial Year 2016-17 by the C&AG.
The Auditors Report does not contain any qualification reservation or adverseremark.
During the year 2015-16 the Cost Audit Report has been filed with the Ministry ofCorporate Affairs on 05.10.2015. The due date for filing the Cost Audit Report was08.10.2015. This Cost Audit Report pertains to the year 2014-15 and the Cost Auditors wereM/s. Rohit & Associates Mumbai and M/s. Musib & Company Mumbai.
The same Cost Auditors have been appointed for the Financial Year 2015-16. The CostAuditor shall within a period of 180 days from the closure of the Financial Year forwardthe Cost Audit Report and the Company is required to file the Cost Audit Report within 30days of receipt of the same. M/s. Rohit & Associates Cost Accountants were nominatedas the Companys Lead Cost Auditor.
The Board has appointed M/s Ragini Chokshi & Company Company Secretaries toconduct Secretarial Audit for the Financial Year 2015-16. The Secretarial Audit Report forthe Financial Year ended 31st March 2016 is annexed herewith in Annexure H tothis Report.
The Secretarial Audit Report does contain an observation that "The Company hascomplied with the provisions of the Act Rules Regulations Guidelines Standardsmentioned therein except for non-compliance under 49(II)(A)(1)/(2) of the erstwhile equityListing Agreement/Regulations 17(1)(a)/(b) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and further in terms of Clause 2.2 and 3.1.4 of theGuidelines issued by DPE relating to the condition of having at least one Woman Directoras on 31 st March 201 6 and half of the Board of Directors shall comprise ofIndependent Directors and consequently the Committee constitution requirement not met withduring the period when Independent Directors were not on the Board."
Explanations by the Board to the above observation in the Secretarial Auditor Report:
Bharat Petroleum Corporation Ltd. is a Government Company under the AdministrativeControl of Ministry of Petroleum and Natural Gas. The Government of India makesnomination/appointment of all categories of Directors in accordance with the laid downDepartment of Public Enterprises Guidelines. The subject matter of nomination/appointmentof adequate number of Independent Directors including Woman Director falls under thepurview of the Government of India.
We have taken up the matter with the Ministry of Petroleum & Natural Gas andnecessary actions are being initiated to fulfill the requirements and nominations foradequate number of Independent Directors. It may be noted that the Company was having aWoman Director from 19.05.2015 till 01.01.2016.
There were no significant or material orders passed by the Regulators or Courts orTribunals impacting the going concern status and Companys operations in future. TheCompany has not issued equity shares with differential rights/sweat equity shares/EmployeeStock Options. During the year under review there was one complaint of sexual harassmentfrom an employee of a Contractor which is currently under investigation by the InternalComplaints Committee.
The Directors thank our customers vendors investors and bankers for their continuedsupport during the year. We place on record our appreciation of the contribution made byemployees at all levels. BPCLs consistent growth has been possible only due to their hardwork solidarity cooperation and support.
We thank the Government of India Government of Maharashtra Government of Kerala andall State Governments other Government agencies and Ministry of Petroleum & NaturalGas for their guidance and support and look forward to their continued participation inBPCLs growth.
For and on behalf of the Board of Directors