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CCL Products (India) Ltd.

BSE: 519600 Sector: Agri and agri inputs
NSE: CCL ISIN Code: INE421D01022
BSE LIVE 15:43 | 02 Dec 274.15 4.25
(1.57%)
OPEN

267.60

HIGH

276.00

LOW

262.00

NSE LIVE 15:58 | 02 Dec 272.85 3.50
(1.30%)
OPEN

267.50

HIGH

277.00

LOW

261.00

OPEN 267.60
PREVIOUS CLOSE 269.90
VOLUME 22472
52-Week high 286.00
52-Week low 154.00
P/E 31.48
Mkt Cap.(Rs cr) 3647.57
Buy Price 0.00
Buy Qty 0.00
Sell Price 274.15
Sell Qty 189.00
OPEN 267.60
CLOSE 269.90
VOLUME 22472
52-Week high 286.00
52-Week low 154.00
P/E 31.48
Mkt Cap.(Rs cr) 3647.57
Buy Price 0.00
Buy Qty 0.00
Sell Price 274.15
Sell Qty 189.00

CCL Products (India) Ltd. (CCL) - Director Report

Company director report

Your Directors submit their report for the financial year ended 31.03.2016:

Particulars 2015-16 2014-15
Revenue from operations 67719 67198
Profit for the year after meeting all expenses (before Interest Depreciation & Tax) 14040 12933
Less:
Interest 430 564
Depreciation and other write offs 984 945
Provision for Taxation 4432 3957
Net Profit 8194 7466
Balance brought forward 8998 6967
Balance available for appropriation 17192 14399
Provision for dividend 3326 1995
Provision for dividend tax 677 406
Transfer to General Reserve - 3000
Balance carried forward to Balance sheet 13189 8998

Company Performance

Your Company posted good financial results during the year under review. Turnover ofthe Company has increased from ' 67198 Lakhs to ' 67718 Lakhs and the net profit of theCompany increased from ' 7466 Lakhs to ' 8194 Lakhs.

Transfer of amount to General Reserve

No amount has been transferred to reserves during the year.

Dividend

Your Directors have declared an interim dividend of '1.50/- per equity share of ' 2/-each for the year 2015-16 and also pleased to recommend a final dividend of ' 1.00/- perequity share of ' 2/- each for the year 2015-16 subject to the approval of shareholders.

Subsidiaries

Jayanti Pte Limited (Singapore)

Jayanti Pte Limited is a wholly owned subsidiary of the Company incorporated inSingapore for the purpose of promoting instant coffee projects in various countries. Thisis only an investment Company hence no operational performance is reported.

Grandsaugreen SA (Switzerland)

Grandsaugreen SA is a wholly owned subsidiary of Jayanti Pte Limited and step downsubsidiary of the Company incorporated in Switzerland. This is an agglomeration andpacking unit and a brief operational performance of the Company is as below:

(Rs. in Lakhs)
Particulars 2015-16 2014-15
Revenue from operations 8572 6655
Profit for the year after meeting all expenses
(before Interest Depreciation & Tax) 159 224
Less:
Interest 22 15
Depreciation and other write offs 480 476
Provision for Taxation 32 27
Net Profit/Loss (375) (294)

Ngon Coffee Company Limited (Vietnam)

Ngon Coffee Company Limited is a wholly owned subsidiary jointly owned by CCL andJayanti Pte Limited. This is an instant coffee manufacturing unit and a brief operationalperformance is as below:

(Rs. in Lakhs)
Particulars 2015-16 2014-15
Revenue from operations 24376 19554
Profit for the year after meeting all expenses
(before Interest Depreciation & Tax) 6405 4271
Less:
Interest 629 782
Depreciation and other write offs 1375 1261
Provision for Taxation - --
Net Profit/Loss 4401 2228

Continental Coffee Private Limited

Continental Coffee Private Limited is a wholly owned subsidiary of the Company whichhas been established with an objective of promoting instant coffee brands of the Companyin the domestic market and a brief operational performance is as below:

(Rs. in Lakhs)
Particulars 2015-16 2014-15
Revenue from operations 12 -
Profit for the year after meeting all expenses
(before Interest Depreciation & Tax) (2) -
Less:
Interest - -
Depreciation and other write offs - -
Provision for Taxation - -
Net Profit/Loss (2) -

The Statement containing the salient feature of the financial statement of subsidiariesas per sub-section (3) of Section 129 of the Companies Act 2013 in Form AOC-1 is herewithannexed as ‘Annexure I’ to this report.

Corporate Social Responsibility

The Company as part of its Corporate Social Responsibility (CSR) initiative undertookmany projects like promotion of education in rural areas infrastructure and sanitationdevelopment welfare of girl child facilitating pure drinking water to the identifiedrural areas in and around the factory at Duggirala Guntur District Andhra Pradesh andalso rural women empowerment and youth skill development programmes in rural areas aroundHyderabad.

The Annual Report on CSR activities is annexed herewith as “Annexure II” tothis report and CSR Policy is posted on the website of the Company and the web link ishttp://cclproducts.com/assets/csr-policy3.pdf

Internal Control Systems & their adequacy

The Board has adopted policies and procedures for ensuring orderly and efficientconduct of its business including adherence to Company’s policies safeguarding ofits assets prevention detection of frauds and errors accuracy and completeness of theaccounting records and timely preparation of reliable financial disclosures.

Statutory Auditors

The Shareholders in their meeting held on 19th July 2014 approved theappointment M/s. M. Anandam & Co. Chartered Accountants Hyderabad as the StatutoryAuditors of the Company to hold office till the conclusion of 56th AnnualGeneral Meeting subject to ratification of shareholders in every Annual General Meeting.Accordingly a resolution seeking Members’ ratification on appointment of M/s.Anandam & Co. Chartered Accountants Hyderabad as the Statutory Auditors of theCompany for the financial year 2016-17 is included at Item No.4 of the Notice conveningthe Annual General Meeting.

Internal Auditors

The Board of Directors based on the recommendation of the Audit Committee havere-appointed M/s. Ramesh & Co. Chartered Accountants Hyderabad as the InternalAuditors of your Company. The Internal Auditors are submitting their reports on quarterlybasis.

Cost Auditors

In accordance with Section 148(3) and other applicable provisions if any of theCompanies Act 2013 and The Companies (Cost Records and Audit) Rules 2014 the AuditCommittee has recommended and the Board of Directors had appointed M/s. Kapardi &Associates Cost Accountants Hyderabad being eligible and having sought re-appointmentas Cost Auditors of the Company to carry out the cost audit of the products manufacturedby the Company during the financial year 2016-17 on a remuneration of '125000/-. Theremunaration payable to the cost auditor is required to be placed before the Members in ageneral meeting for their ratification. Accordingly a resolution seeking Membersratification for the remuneration payable to M/s. Kapardi & Associates CostAccountants is included at Item No. 7 in the Notice convening the Annual General Meeting.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s. P.S.Rao & Associates a firm of Company Secretaries in Practice toundertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexedherewith as “Annexure IN” to this report.

Directors

The Board of Directors have appointed Ms. Shantha Prasad Challa and Dr. LankaKrishnanand as Additional Directors of the Company who hold office till the ensuing AnnualGeneral Meeting. The Board based on the recommendation of Nomination and RemunerationCommittee considered their appointment as Non-Executive Directors subject to approval ofShareholders. Accordingly resolutions seeking approval of Shareholders for theirappointment as Non-Executive Directors whose office is liable to retire by rotation isincluded in the Notice convening the Annual General Meeting.

In accordance with the provisions of Section 152 of the Companies Act 2013 Ms.Kulsoom Noor Saifullah Director of the Company retires by rotation and being eligiblehas offered herself for re-appointment.

All the Independent Directors have given declarations stating that they meet thecriteria of independence as per the provisions of Section 149 of the Companies Act 2013and SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

A Brief Profile of the Directors of the Company is annexed with as “AnnexureIV” to this report.

Meetings of the Board

Five meetings of the Board of Directors were held during the year. The details of theBoard and Committee meetings are given in the Corporate Governance Report which form partof this Annual Report.

Audit Committee

The Board has constituted Audit Committee as per the provisions of Section 177 of theCompanies Act 2013 and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. The composition attendance powers and role of the Audit Committee areincluded in Corporate Governance Report. All the recommendation made by the AuditCommittee were accepted by the Board of Directors.

Policy on Director’s Appointment and Remuneration and other matters

(a) Procedure for Nomination and Appointment of Directors:

The Nomination and Remuneration Committee has been formed pursuant to and in compliancewith Regulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 and pursuant to Section 178 of the Companies Act 2013. The main object of thisCommittee is to identify persons who are qualified to become directors and who may beappointed in senior management of the Company recommend to the Board their appointmentand removal and to carry out evaluation of every Director’s performance recommendthe remuneration package of both the Executive and the Non-Executive Directors on theBoard and also the remuneration of Senior Management one level below the Board. TheCommittee reviews the remuneration package payable to Executive Director(s) and recommendsto the Board the same and acts in terms of reference of the Board from time to time.

On the recommendation of the Nomination and Remuneration Committee the Board hasadopted and framed a Remuneration Policy for the Directors Key Managerial Personnel andother Employees pursuant to the provisions of the Companies Act 2013 and SEBI (ListingObligations and Disclosure Requirements) Regulations 2015

The remuneration determined for Executive/Independent Directors is subject to therecommendation of the Nomination and Remuneration Committee and approval of the Board ofDirectors. The Non-Executive Directors are compensated by way of profit sharing Commissionand the Non-Executive Directors are entitled to sitting fees for the Board/CommitteeMeetings. The remuneration paid to Directors Key Managerial Personnel and all otheremployees is in accordance with the Remuneration Policy of the Company.

The Nomination and Remuneration Policy and other matters provided in Section 178(3) ofthe Act and Regulation 19 of SEBI Listing Regulations have been disclosed in the CorporateGovernance Report which forms part of this Report.

(b) Familiarisation/Orientation program for Independent Directors: A formalfamiliarization programme was conducted about the amendments in the Companies Act 2013Rules prescribed thereunder SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and all other applicable laws of the Company.

It is the general practice of the Company to notify the changes in all the applicablelaws from time to time in every Board Meeting conducted.

The details of such familiarization programmes for Independent Directors are posted onthe website of the Company and web link ishttp://cclproducts.com/assets/familiarization-programme-for-independent- directors-13.pdf

Annual Evaluation of Board Performance and Performance of its Committees and ofDirectors

Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Board has carried out the annualperformance evaluation of its own performance the Directors individually as well as theevaluation of the working of its Audit and other Committees.

A structured questionnaire was prepared after considering the inputs received from theDirectors covering various aspects of the Board’s functioning such as adequacy ofthe composition of the Board and its Committees Board culture execution and performanceof specific duties obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directorsincluding the Chairman of the Board who were evaluated on parameters such as level ofengagement and contribution independence of judgement safeguarding the interest of theCompany and its minority shareholders etc. The performance evaluation of the IndependentDirectors was carried out by the entire Board. The performance evaluation of the Chairmanand the Non Independent Directors was carried out by the Independent Directors who alsoreviewed the performance of the Secretarial Department. The Directors expressed theirsatisfaction with the evaluation process.

Particulars of Loans Guarantees and investments

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

Fixed Deposits

Your Company has not accepted any fixed deposits and as such no principal or interestwas outstanding as on the date of the Balance sheet.

Capex

The Company has spent ' 4363.76 Lakhs towards purchase of land building and balancingequipment during the year.

Directors’ Responsibility Statement

Pursuant to Section 134 (5) of the Companies Act 2013 your Directors confirm that tothe best of their knowledge and belief and according to the information and explanationobtained by them

i) In the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

ii) Such accounting policies as mentioned in the notes to the financial statements havebeen selected and applied consistently and judgments and estimates that are reasonable andprudent made so as to give a true and fair view of the state of affairs of the Company atthe end of the financial year 2015-16 and of the profit or loss of the Company for thatperiod;

iii) Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;

iv) The annual accounts for the year 2015-16 have been prepared on a going concernbasis.

v) That proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.

vi) That systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.

Vigil Mechanism / Whistle Blower Policy

The Company has a Whistle Blower Policy framed to deal with instance of fraud andmismanagement if any in the Group. The details of the Policy are explained in theCorporate Governance Report and also posted on the website of the Company and the web linkis http://cclproducts.com/assets/whistle- blower-policy3.pdf

Risk Management

The Company has constituted a Risk Management Committee and formulated a policy on theRisk Management. The details of Committee and its terms of reference are set out in theCorporate Governance Report forming part of the Board’s Report. The Risk ManagementPolicy of the Company is posted on the website of the Company and the web link ishttp://cclproducts.com/assets/risk-management-policy3.pdf

Related Party Transactions

All related party transactions that were entered into during the financial year were onan arm’s length basis and were in the ordinary course of business. There are nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.

All related party transactions are placed before the Audit Committee as also the Boardfor approval. Prior omnibus approval of the Audit Committee is obtained as per SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 for the transactionswhich are of a foreseen and repetitive nature. The Company has developed a Policy onRelated Party Transactions for the purpose of identification and monitoring of suchtransactions.

None of the transactions with related parties falls under the scope of section 188(1)of the Companies Act 2013. Information on transactions with related parties pursuant tosection 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules 2014are given in Annexure V in Form AOC-2 and forms part of this report.

The policy on Related Party Transactions as approved by the Board is uploaded on thewebsite of the Company and the web link ishttp://cclproducts.com/assets/policv-on-related-partv-transactions3.pdf

Policy on Material Subsidiaries

The Policy on Material Subsidiaries as per SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 as approved by the Board is uploaded on the website of theCompany and the web link ishttp://cclproducts.com/assets/policy-on-material-subsidiary3.pdf.

Extract of Annual return

Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rules 2014 the details forming part of the extract ofthe Annual Return in form MGT 9 is annexed herewith as “Annexure VI” to thisreport.

Management Discussion & Analysis

Pursuant to the provisions of Regulation 34(2) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a report on Management Discussion &Analysis is herewith annexed as “Annexure VII” to this report.

Particulars of Employees

The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is herewith annexed as ‘Annexure VIII’ to this report.

Corporate Governance

The Company has been making every endeavor to bring more transparency in the conduct ofits business. As per the requirements of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 a compliance report on Corporate Governance for the year2015-16 and a Certificate from the Auditors of the Company are furnished which form partof this Annual Report.

Human Resources

Your Company considers its Human Resources as the key to achieve its objectives.Keeping this in view your Company takes utmost care to attract and retain qualityemployees. The employees are sufficiently empowered and such work environment propels themto achieve higher levels of performance. The unflinching commitment of the employees isthe driving force behind the Company’s vision. Your Company appreciates the spirit ofits dedicated employees.

Policy on Prevention Prohibition and redressal of Sexual Harassment at Work place

Your Company strongly supports the rights of all its employees to work in anenvironment that is free from all forms of harassment. The Company has adopted a Policy onPrevention Prohibition and Redressal of Sexual Harassment at workplace as per theprovisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules made thereunder. The policy aims to provide protectionto Employees at the workplace and prevent and redress complaints of sexual harassment andfor matters connected or incidental thereto with the objective of providing a safeworking environment where Employees feel secure. The Company has also constituted anInternal Committee known as Anti Sexual Harassment Committee to address the concerns andcomplaints of sexual harassment and to recommend appropriate action.

The Company has not received any complaint on sexual harassment during the year.

Energy conservation technology absorption and foreign exchange earnings and outgo

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014 is annexed herewith as “AnnexureIX” to this report.

Significant and material orders passed by the regulators or courts

There are no significant or material orders passed by the Regulators / Courts whichwould impact the going concern status of the Company and its future operations.

Material Changes and Commitments

There were no material changes and commitments affecting the financial position of theCompany that have occurred between the end of the Financial Year 2015-16 of the Companyand the date of the report.

Acknowledgments

Your Directors take this opportunity to express their sincere appreciation to theshareholders customers bankers suppliers and other business associates for theexcellent support and cooperation extended by them.

Your Directors gratefully acknowledge the ongoing co-operation and support provided bythe Central and State Governments Stock Exchanges SEBI RBI and other Regulatory Bodies.

On behalf of the Board
Sd/-
Place : Hyderabad Challa Rajendra Prasad
Date : 29th July 2016 Executive Chairman

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