Your directors are pleased to present their report on the business and operations ofthe company and the statement of accounts for the financial year ended 31st March 2017.
(Rs in crore)
|Particulars ||2016-17 ||2015-16 |
|Income from operations ||5606.13 ||5921.73 |
|Profit before depreciation & tax (PBDT) ||1532.43 ||1655.71 |
|Profit before tax (PBT) ||1180.61 ||1307.95 |
|Provision for tax including prior period tax adjustments ||322.59 ||357.13 |
|Profit after tax (PAT) ||858.02 ||950.82 |
|Other Comprehensive Income ||(3.14) ||1.24 |
|Total Comprehensive Income for the period ||854.08 ||952.06 |
|APPROPRIATIONS: || || |
|Interim Dividend (Current Year) ||187.18 ||155.98 |
|Final Dividend (Previous Year) ||107.23 ||105.30 |
|Corporate tax on dividend ||59.94 ||53.18 |
|Transfer to general reserves ||85.80 ||78.69 |
|Balance carried to Balance Sheet ||414.74 ||558.91 |
|Earnings per share (Rs.) ||35.21 ||39.01 |
Ministry of Railways Govt. of India vide its order no.2011/PL/64/3/Pt.1 dated29.04.2016 issued Presidential directive stating therein that interim dividend for thefinancial year 2016-17 shall be 20% higher than the interim dividend 2015-16 and totaldividend forthefinancialyear 2016-17 shall be minimum 40% of profit after tax. Further asper the guidelines issued by DIPAM the minimum dividend to be paid for the year 2016-17should be at least 5% of net worth or 30% of profit after tax whichever is higher.Therefore taking into consideration the above the Board recommends a final dividend of75% on the paid up share capital of ` 243.72 crores. An interim dividend @ 96% on the paidup share capital of `194.97 crores has already been paid. The total dividend (includingdividend distribution tax) for the year 2016-17 will be `445.29 crores as compared to`316.79 crores for the FY 2015-16 which is an increase of 40.56% over previous year. Thedividend for the year 2016-17 works out to 51.90% of profit after tax of the company forthe year and is 5.03% of net worth as at 31.03.2017.
The operating turnover of your company registered a decline of 5.33% during the yearunder review decreasing from `5921.73 crores in the previous year to `5606.13 crores inthe current year. Total expenditure decreased by 4.39% from `4931.26 crores in 2015-16 to`4714.76 crores in 2016-17. The profit before tax works out to `1180.61 crores lower by9.74% over 2015-16. After making provisions for income tax tax adjustments the netprofit stands at `858.02 crores which is 9.76% lower than last year. This decrease inProfit After Tax (PAT) is due to rising costs and competition in the business.
The throughput of your company has increased during the year 2016-17 in comparison tothe year 2015-16. The segment-wise comparison is as under:
|Handling at Terminals (In TEUs) ||2016-17 ||2015-16 ||% age growth |
|Exim ||2641695 ||2475868 ||6.70% |
|Domestic ||460516 ||448178 ||2.75% |
|Total ||3102211 ||2924046 ||6.09% |
As can be seen there has been a increase of 6.70% in EXIM and 2.75% in Domesticthroughput. In terms of tonnage also the company carried a total tonnage of 34.70 milliontons in current fiscal as against 33.40 Million tons in previous fiscal
(2015-16) resulting an increase of 3.9%.
During the year there has been no change in the capital structure of the company andits paid up share capital stands at `194.97 crore. In the month of October 2016 Ministryof Railways Government of India has transferred 82340 equity shares to the eligibleemployees of company in which 487436 equity shares were offered at `1135.25 (maximumshares per employee 176). Further during January 2017 and March 2017 Government of Indiadivested 1.40% and 0.55% respectively stake in company through CPSE ETF FFO and CPSE ETFFFO2. Through these successful CPSE ETF FFOs Govt. has divested 3808253 equity sharesof the company. Accordingly the shareholding of Government and others in the company ason 31.03.2017 was 54.80% and 45.20% respectively which was 56.79% & 43.21%respectively as on 31.03.2016. In the month of February 2017 issuance of one bonus equityshare for every four equity shares held was recommended by board for which approval ofshareholders through postal ballot route was taken by the company. After the aboveapproval of shareholders the Board of Directors have allotted (on 10.04.2017) bonusshares to the shareholders and as a result the paid up share capital of the company hasincreased from `194.97 crores to ` 243.72 crores comprising of 243717739 equity shares`10/- each.
LISTING AND DEMATERIALIZATION OF SHARES
CONCOR's shares are listed with the bourses i.e. Bombay and National Stock Exchanges.The listing fees of both the stock exchanges have been paid. To facilitatedematerialization of shares by its shareholders CONCOR has signed agreements with boththe Depositories (NSDL & CDSL). As per SEBI guidelines CONCOR's shares have beenplaced under Compulsory Demat Mode'. Out of 194974191 equity shares listed on theStock Exchanges 194971531 equity shares were in demat mode as on 31.03.2017. Themarket capitalization of the company was `24834 crores as on 31.03.2017 (as per closingprice on NSE). In the month of April 2017 the company has allotted 48743548 Bonusequity shares to the shareholders. Therefore the paid up & listed equity shares ofthe company increased from 194974191 equity shares of `10/- each to 243717739 equityshares of `10/- each.
Capital Expenditure of `1056.80 crores approx. was incurred mainly ondevelopment/expansion of terminals acquisition of land wagons handling equipments andIT Infrastructure etc.
NEW TERMINALS & TERMINAL NETWORK EXPANSION
During the year the company has further strengthened its existing Terminal Network toprovide efficient services to its customers. The Company has 68 Terminals in total as on31.03.2017 of which 13 are pure EXIM Terminals 37 are Combined Container Terminals 17are pure Domestic Terminals and 1 RCT. Five facilities were developed during the year2016-17 l Ahmedgarh (Punjab) l Visakhapatnam (Andhra Pradesh) l Tihi(Madhya Pradesh) l Jharsuguda (Odisha) l Krishnapatnam (Andhra Pradesh)Further at least 7 new facilities and completion of the balance infrastructure in theabove facilities is planned for 2017-18. CONCOR will continue with its plans for anaggressive CAPEX programme for further developing new Terminals especially along theupcoming Western & Eastern DFC and in partnership with Ports both existing as well asupcoming.
HIGH SPEED WAGONS CONTAINERS AND HANDLING EQUIPMENTS
In order to strengthen and improve the service level during the year under review 550BLC wagons were added to the existing fleet of CONCOR owned wagons increasing the holdingof high speed wagons to 12658. Therefore total wagon (BLC+BLL+BFKN+BVZI) holding hasgone upto 13998 as on 31.03.2017.
As on 31.03.2017 your company has 21642 (owned plus leased) containers and it alsoowns 52 Reach Stackers and 16 Gantry cranes. In addition 26 nos. Reach Stackers containerhandling equipment have been commissioned during FY 2016-17.
Your Company continued to make progress in the field of information technology. TheVSAT based network has been extended and now it covers 73 locations. The TerminalManagement Systems for Domestic (DTMS) for EXIM (ETMS) ERP for Oracle Financial HRPayroll Container Repair System Operation system were implemented for the expandednetwork of terminals and a Data Warehouse Module for commercial applications oncentralized architecture is running smoothly across field locations/Regional Offices andCorporate Office.
The web enabled customer interface through a dedicated web server is runningsuccessfully providing facilities to the customers. The customer feedback facility systemas implemented on the website enables us to constantly evaluate our performance and takecorrective action on customer complaints and feedback. Public grievance lodging andmonitoring system has been deployed on CONCOR's website for grievance redressal system.This system has been developed in line with the O.M. dated 18/02/2013 of Department ofAdministrative Reforms & Public Grievances. The objective of the system is to reducetime in addressing grievance to increase transparency and round the clock access forlodging and monitoring grievances to increase transparency and round the clock access forlodging and monitoring grievance.
The electronic-filing facility of documents on the commercial system initially providedat ICD/Tughlakabad have now been extended to all EXIM terminals which enable the customersto file their documents electronically from their own offices and on-line payment mode ofNEFT/RTGS has been enabled. As part of business continuity plan CONCOR has establishedbackup site and standby system at primary site for its commercial business criticalapplications. CONCOR has been re-certified from STQC IT Certification Services (Ministryof Communication & Information Technology) for establishing an Information SecurityManagement System (ISMS).
As an extension of existing HRMS employee portal has been introduced. This systemfacilitates employees to access information regarding their Salary/ reimbursements leavebalances PF statement view their APAR online Online submission of annual propertyreturn pension details etc. and employee has option of viewing the information on thescreen and the printout of the same can also be taken for the record. Online paymentsystem for Corporate office and all regions implemented from Oracle Financials. Thee-tender system with e-payment facility for sale and EMD electronically MSE exemptionshas also been introduced. Recruitment on CONCOR's website is integrated with onlinepayment gateway for collection of fees. CONCOR has implemented reverse auction.
CONCOR has re-designed its Corporate website as a responsive website.
E-samarth application for online vigilance clearances to handle bulk NOC requestcreation and approval and work flow driven system has been evolved. This has increasedtransparency and drastically reduced the total time of according NOC for various purposes.
E-voting was successfully done for CONCOR shareholders. File tracking system wasimplemented at Corporate office of
Document Management System has been introduced as a step towards digitalization.
CONCOR has implemented e-meeting app for conducting paperless Board Meetings for CONCORand its subsidiaries. CONCOR has launched its mobile app for the information (Publictariff Rail tariff track & trace Company directory etc.) for its stakeholders.
CONCOR continues to enjoy ISO 9001:2008 certification. It is an illustration of thetotal commitment of your Company towards Quality Management System. Quality policy clearlyprovides for ensuring complete customer convenience & satisfaction and Value for moneythrough continual improvement of system and processes. The Quality Policy has beenprominently displayed at all locations of CONCOR. During the period under review aSpecial Safety Drive' was observed by all the regions to create more awareness amongthe CONCOR officials about safety requirements. The Safety Drive' was observedduring October 2016. Safety Slogans are displayed at prominent locations at variousterminals of CONCOR.
ISO Certification is available for most of the Units of your Company. DisasterManagement System has been hosted on
CONCOR website. Further in its endeavor to maintain high standards of quality yourCompany has been taking various steps which are as follows: There were periodicalManagement Review Meetings wherein various actions were taken including DisasterManagement Safety Norms and Quality Standards.
There were Quality Audits undertaken by internal trained Quality Auditors from timeto time. Special emphasis was made on Swach Bharat" campaign in physicalcleanliness of the workstation & other places and proper stacking of files recordsetc. for positive work environment.
There were number of units for which Annual Surveillance Audit was undertaken by anindependent agency.
As on 31.03.2017 63 Nos. of Terminals (Including C.O. and 8 Nos. Regional Offices)were ISO 9001:2008 certified.
JOINT VENTURES/ STRATEGIC ALLIANCES
Your company continued to place emphasis on providing total logistics and transportsolutions to its customers by exploring the possibilities of expanding the presence of thecompany in all segments of Logistics value chain in the EXIM as well as
Domestic segments. Strategic alliances firmed up both for optimal utilization ofinfrastructure as well as expansion into other segments of the value chain have beeneffectively achieving the goals. SIDCUL CONCOR Infra Company Ltd. (SCICL) a Joint VentureCompany with shareholding of 74% and 26% of Container Corporation of India Limited(CONCOR) and State Infrastructure & Industrial Development Corporation of UttarakhandLtd. (SIIDCUL) respectively has developed a Multimodal Logistic Park (MMLP) at Pantnagarlocated approx. 300 mts from Rudrapur-Haldwani State Highway and approx. one km. from theNH-87. The facility was inaugurated in the year 2015-16 and the company has commenced itscommercial business operation (Domestic) from 28.11.2015 and EXIM Business operationcommenced from 17.09.2016. The total throughput from 01.04.2016 to 31.03.2017 is 15227TEUs which is quite impressive for a startup company in its first year of operations.SCICL has handled 280 rakes in the FY 2016-17. The total container handled at MMLPPantnagar for the said period is 22229 TEUs and the revenue for the company from businessoperations through handling transportation storage etc. of container for the said periodwas `4.56 crores. The JVC is expected to emerge as a major logistics service provider forrail logistics for the rapidly industrializing State of Uttrakhand.
The facility at Pantnagar has given rail access to CONCOR and significant volume isexpected to move from this region. It will provide CONCOR with much needed rail access fortapping effectively the potential of the area and thereby divert more traffic from road torail and will contribute in reducing .carbon emission generated duetoroadtransportation
The Company Punjab Logistics Infrastructure Limited (PLIL) is a Joint Venture Companyof Container Corporation of India Limited (CONCOR) & Punjab State Container andWarehousing Corporation Limited (CONWARE). The company has developed a Logistics Hubs inthe state of Punjab facilitating trade and industry of the state and putting them onInternational map. The authorized capital of the company was `2000000000/- (Rupees TwoHundred Crores only) as on 31st March 2017. Against this the paid up share capital ofthe company has been increased from `1394000000/- (Rupees One Hundred Thirty NineCrores and Forty Lacs Only) to `1700000000/- (Rupees One Hundred and Seventy CroresOnly) during the year under report. The work related to phase-I has completed andcommercial activity has already started for business operation. The terminal has beencommercially notified by Railways as Private Freight Terminals for starting the commercialactivities on March 2nd 2017. After the notification two numbers of rakes ran on PLILsiding. "Flagging off First Train run" was done by General
Manager /Northern Railways along with CMD/CONCOR on 3rd March 2017.
The Company concentrated on the development of the project during the financial yearended 31st March 2017. The earnings were from other sources during the year amounting`4752430/-.
The above two companies i.e. SCICL & PLIL are also subsidiaries of your company asit is holding majority of shares in these companies. While the existing Subsidiaries &Joint Ventures continued to perform to their full potential contributing to the growth ofthe core business of CONCOR new strategic alliances were made. CONCOR entered into anagreement wherein CONCOR rakes have been provided exclusive access at the three railconnected terminals at Panipat Jakhwada and Thimmapur.
Further an agreement was also signed with Kribhco Infrastructure Limited (KRIL)for exclusive use of KRIL's Hazira terminal for Exim movement for Hazira Port . A MOU wassigned between CONCOR & GIDC (Gujarat Industrial Development Corporation) forestablishment of a Multi Modal Logistics Park at Dahej. Another MOU was signed betweenCONCOR & GIDB (Gujarat Infrastructure Development Board) during the Summit forestablishment of an Inland Container Depot at Rajkot. A Memorandum of Agreement was signedbetween CONCOR and HAL for a further period of 5 years for Domestic and EXIM trade atHAL's Ozar Airport at Nashik. A Memorandum of Agreement was signed between CONCOR andAirport Authority of India (AAI) subsidiary AAI Cargo Logistics And Allied ServicesCompany Ltd.' for Management Development and Operations of Air Cargo business at variousAAI/JVC operated airports either jointly or through CONCOR independently.
A Memorandum of Agreement was signed between CONCOR and Land Ports Authority ofIndia for Operations and Management of Cargo Terminal at the Integrated Check Post (ICP)Raxaul.
WHOLLY OWNED SUBSIDIARIES
CONCOR had incorporated M/s. Fresh & Healthy Enterprises Ltd. (FHEL) in the year2006 as its wholly owned subsidiary to create world class cold storage infrastructure inthe country to provide complete cold chain logistics solutions to the variousstakeholders in this field.
Keeping in view the losses incurred by the Company year after year despiteimplementation of various strategic measures it was agreed that (a) company will not doany purchase/procurement during the year; and (b) leasing model for CA (ControlledAtmosphere) chambers would be followed for the year 2015-16.
Further Committee of Secretaries (COS) in its meeting held on 13.07.2015 recommendedthat Ministry of Railways (MoR) may consider the possibility of divesting the Company tothe Private sector. However HSIIDC in their letter in December 2015 refused to transferland lease arrangements on which the facility has been constructed to any private entitythus making divestment not a feasible option.
However of late number of private parties has approached FHEL for taking the facilityon rent for general warehousing purposes. Accordingly a request was again made in Feb.2017 to HSIIDC for transfer of the land lease in the name of FHEL and change of land usefrom Cold Chain complex to warehousing purpose. HSIIDC vide their letter of April 2017agreed in principle to transfer the land lease in the name of FHEL and the request forchange of land use is under consideration by HSIIDC.
Due to poor apple crop in 2016-17 renting of CA Chambers was very badly hit.Presently efforts are being made to lease out entire facility to interested parties onlong term basis.
FHEL has incurred Net Loss of `13.74 Crores during F/Y 2016-17 as against Net Loss of`25.89 Crores during previous year (2015-16). As on 31.03.2017 accumulated losses of thecompany stood at `153.75 Crores. In order to expand its span of operations and make itspresence felt in Air cargo business with a view to establish itself in this IndustryCONCOR formed a new company named CONCOR Air Ltd. (CAL) under the Companies Act 1956 inJuly 2012. It is 100% subsidiary of CONCOR and has an authorised share capital of `50crores. The Objectives of CAL are: To undertake Air Cargo related activities inInternational as well as Domestic circuit.
To contribute in the development of Air Cargo business of the country by providingend to end solutions to the customers through the mode of bonded trucking of Import/Exportcargo from the various hinterlands to the Airports.
To provide warehousing facilities to International & Domestic Air Cargo and tofacilitate the clearance of EXIM & Domestic Air Cargo.
CONCOR Air Ltd. has made its presence felt at Chattrapati Shivaji International Airportin the field of domestic and international air cargo related activities by entering intoconcession agreements with Mumbai International Airport Ltd. (MIAL).
Domestic Air Cargo Concession:
In February 2013 CONCOR Air Ltd. has entered into an agreement with MIAL under whichSANTACRUZ AIR CARGO TERMIAL (SACT) has been developed by CONCOR Air Ltd. SACT is aState-of-the-art GREEN terminal with ultra-modern facilities for storage of cargohandling screening cold storage etc. SACT was commissioned on 09.06.2016. Beforecommissioning of SACT CAL had taken over the existing Domestic Common User Terminal ofMIAL at Marol for operations w.e.f. 01.05.2013. At Marol CAL was handling domestic aircargo of four airlines viz; Indigo Spicejet Go Air and Vistara. With the commissioningof SACT Jet Airways has also shifted its cargo to CAL. International ConcessionAgreement: CONCOR Air Ltd. has also entered into Concession Agreement with MIAL on30.10.2013 for operations and management of International Air Cargo at ACC Sahar. CAL hastaken over operations at ACC from February 2014. Thus we have got an opportunity to showour capability in the field of International air cargo as well.
With taking over of International as well as domestic air cargo operations at CSIAAirport which is one of the best International
Airport in the world CONCOR Air Ltd. is heading towards establishingitselfinthefieldof International and Domestic air cargo industry. The company has earnednet profit of`7.84 crores after tax during 2016-17. The paid up equity capital of thecompany was `36.65 Crores as on 31.03.2017.
The annual reports of the above four subsidiaries of CONCOR will be available on thewebsite of the company at www.concorindia.com. Further your company will makeavailable the accounts of its subsidiaries upon request by any shareholder of the company.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements of the Company prepared in accordance with theprovisions of the Companies Act 2013 and the relevant Accounting Standards (AS) issued bythe Institute of Chartered Accountants of India forms part of the Annual Report of theCompany.
HUMAN RESOURCE MANAGEMENT
Human Resource Management (HRM) in organizations is designed to maximize employeeperformance to achieve strategic objectives. HR is primarily concerned with the managementof people within organizations focusing on policies and systems.
Being a progressive organisation CONCOR firmly believes in the strength of its mostvital asset i.e. Human Resource.
CONCOR has adopted and aligned its HR strategy vis-a-vis systems & procedurestaking into account the business objectives and competence building needed for theorganisation. HR strategy acts as a motivating factor for the employees who contribute tothe core competence of the organisation to create a match between the company's futureneeds and the aspirations of individual employees.
CONCOR's HR Philosophy is rooted in encouraging employee empowerment growth anddevelopment of individuals by realizing their potential encouraging innovative ideas andfair distribution of rewards.
CONCOR's work culture is open and dynamic enabling employees to take initiative in jobswith active support of the top management.
CONCOR is an employer of choice and attracts the best available talent with skill setsrequired for the growth and development of the organization.
Right placement and refinement of employees is the primary function after induction bywhich CONCOR HR maintains alignment of individual performance and goals with that ofCONCOR Goals.
Great care is taken to provide working environment to the employees conducive to theirgood health. The occurrence of industrial accidents is minimal. Much care is taken tomaintain safe and hygienic working climate conducive to the good health of employees.
CONCOR offers various voluntary benefits to its employees. These are offered inthe form of options to the employees to choose from a mix of perks and allowancesavailable subject to a maximum ceiling. In addition to allowances and benefits covered inthe cafeteria approach additional perks in the form of residential accommodation;telephone instruments/service; advances and welfare amenities are available.
Provision has been made for timely delivery of HR services through Right to Service forTime Bound Delivery of HR Services and Benefits.
CONCOR has a performance oriented culture wherein contribution of every employee to theorganization is measured and suitably rewarded. CONCOR has a sound and result orientedPerformance Management System (PMS). The system promotes CONCOR's philosophy of rewardingand recognizing meritocracy at all levels and support development of executives through astructured approach woven into the appraisal of the company.
CONCOR has an exclusive training centre at Gurgaon to cater to employees' developmentalneeds. CONCOR conducts both In-house and Specialised topic based trainings as perorganisational and employees needs from time to time. Feedback of employees and reportingauthorities is reviewed constructively and accordingly next training calendar isscheduled. Employees are put to On the Job Training Programmes' and are evaluated toget an understanding of the suitability of the employee for his/her right placement andalso to understand specific developmental needs of employees.
CONCOR provides wider opportunities for growth to its employees. Being a youngorganisation with an average age of employees at 40 years it has formulated acomprehensive Performance Management System (PMS) in order to identify not only the jobperformance of the employee but also analysis of employee's behavior and personalitytraits under various descriptions of personality. It gives an idea of employee's trainingand developmental needs and thus contributes majorly to the succession planning of theindividual and thereby helps in the analysis of an employee for his placement for aparticular job.
With a view to keep our below board level employees/ officers prepared for the futurerequirement of the organisation young managers have been placed as the head of theterminals and departments under Group General Managers and Executive Directors who havebeen placed as Head of the Regions and departments. CONCOR HR is a strategic businesspartner and the attrition rate is below 2% owing to CONCOR's employee welfare and careerdevelopment policies.
Sound and healthy Industrial Relations (IR) is the pivot around which the entirebusiness operations revolve. CONCOR believes in community of interests and not inconflictsof interests. Various interest groups strive to further goals in the organisationand resolution of conflicting interests in a positive manner reinforces faith in thesystem besides imbibing strength to face external threats. CONCOR maintained industrialpeace and harmony and no mandays were lost during the year. Positive IR has been the goalof HR department. CONCOR provides two way communication participative culture openplatforms for discussion for ideas and motivation of the employees.
CONCOR is a Central Government Public Sector Undertaking (PSU). It follows allGovernment mandates in true spirit. The representation of such categories against thetotal strength of 1474 as on 31.03.2017 is as under:
|Category ||No. of Employees |
|Schedule Caste ||211 |
|Schedule Tribe ||72 |
|Other Backward Classes ||358 |
|Persons with Disabilities (PwDs) ||32 |
|Ex-serviceman ||23 |
Further the details of reserved category candidates who have been recruited/ appointedduring the year 2016-17 are as under:
|Category ||No. of Employees |
|Schedule Caste ||26 |
|Schedule Tribe ||06 |
|Other Backward Classes ||60 |
|Persons with Disabilities (PwDs) ||08 |
|Ex-serviceman ||09 |
Your company continued to excel in fields of its activities and was a proud recipientof the following awards in the year:
Honoured for "Outstanding Contribution of PSUs in Transport Sector" atthe Dainik Bhaskar 8th India Pride Awards 2016-17. The award was presented by the ShriManoj Sinha Hon'ble Minister of State Ministry of Railways and Minister of State(Independent Charge) Ministry of Communications. Conferred the Dun & BradstreetIndia's Top PSU Awards 2016 under the Transport Services' sector. The award waspresented by Shri. Anil Swarup Secretary Ministry of Coal Government of India."Vigilance Excellence Award 2016" was conferred to CONCOR by Vigilance StudyCircle at Hyderabad for conducting an outstanding study on Civil Works. "SKOCH BSEAwards 2016 for Achieving Market Leadership". The Dun & Bradstreet India's Top500 Companies & Corporate Awards 2016 under the Transportation & Logistics'sector. The award was presented by Shri. Bibek Debroy Member- NITI Aayog Government ofIndia. Honoured for "Outstanding Contribution of PSUs to Nation's Make in India"for creating excellence in the Transport Sector by Hon'ble Union Minister for UrbanDevelopment Shri M. Venkaiah Naidu at the Dainik Bhaskar 7th India Pride Awards 2015-16.
Ranking Among PSUs / Indian Companies
CONCOR was ranked 195 in 2016 of Fortune 500 Indian companies.
CONCOR has been ranked 25 (31 in 2016) in India's Most Profitable PSU by FortuneIndia.
ENERGY CONSERVATION AND TECHNOLOGY ABSORPTION
The relevant information on conservation of energy and technology absorption stipulatedunder Section 134 of the Companies Act 2013 read with Rule 8 of The Companies (Accounts)Rules 2014 are as under: For energy conservation and technology absorptionVirtualization is being done in the servers of major applications which is the latesttechnology with the objective to reduce the hardware power consumption and the coolingrequirement. To save power the multiple servers are also being controlled through singleconsole instead of having the separate monitors which save power as well as reducecooling requirement. Most of the CRT monitors have been replaced by LCD/LED monitorswhich have reduced the power requirement drastically. Most of the latest CPU/ Monitors /Printers of desktops / laptop are configured in power saving mode. The company is usingfuel efficient Rubber Tyred Gantry Cranes and Reach Stackers Machines for handling ofcontainers. Use of fuel efficient power packs to feed power supply to energy efficientRail Mounted Gantry Cranes and improved efficient
In addition to above to conserve energy and to reduce power requirement/ heatdissipation wherever possible consolidation is practiced as per requirement.
FOREIGN EXCHANGE EARNINGS & OUTGO
During the year there were no foreign exchange earnings. The details of foreignexchange outgo are as under:
| ||(Rs in crore) |
|Foreign exchange outgo ||0.27 |
|Import on CIF basis || |
|a) Stores & Spares ||7.08 |
|b) Capital Goods ||79.24 |
RESEARCH & DEVELOPMENT (R&D)
Development of a Mobile Application as a customer friendly initiative for ease ofdoing business and with the objective of continuous visibility of Cargo. Thefunctionalities available on the App as on date are Track & Trace of containersTariffs and other important information about the company. The functionality of this Appis being developed further to be more comprehensive to meet all the requirement ofCustomers.
Implementing E-filing & KYC across Terminals.
Actively associating with Railways for prototype development and trials of 25 Thigher Axle Load Wagons. Also retrofitting few existing rakes from 20.3 T Axle Load to 22T Axle Load to run more Double Stack Trains.
Ministry of Railways vide its order no. 2011/PL/64/3/Pt.1 dated 29.04.2016 has issuedorders stating that with the approval of The President of India CPSEs are hereby directedthat the total dividend for the financial year 2015-16 shall be paid at the rate of 40% ofProfit After tax. Further interim dividend for the financial year 2016-17 shall be 20 percent higher than the interim dividend 2015-16 and total dividend for the FY 2016-17 shallbe minimum 40 per cent of Profit after Tax.
There has been considerable progress in the use of Official Language Hindi in Officialwork of CONCOR. The provisions of Section 3(3) of the Official Languages Act have beenfully complied with and letters received in Hindi were also replied in Hindi. All effortswere made to correspond with offices situated in A' B' and C' regionsin Hindi as per targets set by the Department of Official Language.
Quarterly meetings of Official Language Implementation Committee were held regularlyunder the chairmanship of Chairman & Managing Director to review the progress made inpromoting use of Hindi in CONCOR and the decisions taken therein were properlyimplemented. During the year all regional offices including corporate office wereinspected in order to rectify shortcoming in use of Hindi in official work. 12 Hindiworkshops on various topics were organized to create awareness amongst employees in regardto promote use of Hindi in their official routine work.
Hindi Pakhwara was organized from 14th to 28th September 2016 in which 5 competitionswere held and about 120 officials participated in these competitions. The winner werehonored with Cash Prize and ceritificate. A Hindi Kavi Sammelan was also organized duringpakhwara to promote Hindi language which was well received by CONCOR family.
62 employees were given Cash Awards for doing their official work in Hindi underCONCOR Rajbhasha Puraskar Yojna' for the year 2015-16. Two officials were awardedwith Late Dr. Shankar Dayal Singh Smriti Puruskar 2015 for their significant contributiontowards promoting Hindi in official work. The Office organized a Hindi KahaniVaachan' competition for PSU's under the aegis of Town Official Language ImplementationCommittee (PSU) Delhi on 06th January 2017 in which 24 officials from various PSU'sparticipated. CONCOR was conferred with 2nd Prize by Secretary Official Language forexcellence work in promoting Hindi.
CONCOR keeps its library enriched by acquiring Hindi Books of reputed authors onvarious streams of Hindi Literature. The Number of books in the Library has increased to2386 in which 1730 are Hindi Books. 96 new Hindi Books were purchased during year2016-17. Leading Newspapers as well as monthly and fortnightly magazines continue to besubscribed. To promote original writing in Hindi and familiarize with company'sactivities a quarterly magazine Madhubhasika' has been published regularly. Goodarticles published in this magazine are also suitably awarded. It is also uploaded on thecompany's website. CONCOR's website is bilingual and all computers have Unicode facilityto work in Hindi.
CONCOR's Vigilance Division strives to endorse good corporate governance through twinstrategies of promoting integrity efficiencyand transparency and curbing unethicalpractices in the organisation. To achieve these objectives Vigilance
Department carries out preventive checks suggests systematic improvements organisestraining programmes and recommends punitive actions wherever necessary. The followingactivities were undertaken during the financial year 2016-17.
Periodic surprise checks were conducted regularly keeping in view the vulnerable spots.During the year 2016-17 14
Preventive / Surprise checks / CTE type checks were conducted at various officesaddition cases were investigated on the basis of complaints and other information.Suitable penal action was taken against erring officials `113.94 lakhs was recovered fromvarious contractors/ customers during the and contractors. An amount of financial year.
On the suggestion of Vigilance Division respective user departments have issued 05circulars for improvement in systems and procedures. In order to disseminate informationamong field functionaries Vigilance Division organised 10 training programmes/ workshopsin different Regions covering topical issues such as D & A Rules Facets of Vigilanceand Civil Engineering Works. An intensive review of internal software (ETMS DTMS CCLS)was undertaken in consultation with actual users and as many as 216 suggestions werereceived out of which 141 have been implemented while several more are underconsideration. Information technology is being extensively utilised to effectivelyinstitute more transparent process like e-tendering e-payments e-receipts e-filinge-auction etc. Vigilance Awareness Week (VAW) was observed in all offices of CONCOR withgreat zeal. CMD administered pledge to officialsposted at Corporate Office on 31st Oct.2016. Similar exercise was carried out by the respective Heads of Regional Offices/Terminals in the fields. CVO administered Integrity Pledge to various stakeholders atCONCOR's flagship container depot located at Tughlakabad on 31st Oct. 2016 to mark thebeginning of VAW 2016. A link of e-pledge has been provided on the homepage of CONCOR'swebsite. More than 1100 employees have taken the e-pledge.
In order to motivate the employees to be alert on work place the award for "TheMost Vigilant Employee of the Year" was constituted and this year the award wasgiven to Shri Kunj Bihari Executive (C&O)/ North Central Region during VigilanceAwareness Week 2016 .
A panel discussion was organised at Corporate Office on 01st Nov. 2016 where eminentrepresentatives from private sector shared their views on combating corruption.
Vigilance Division organized first-ever Inter-College skit Competition on topic"Collective Action to Fight Corruption" at Shri
Ram College of Commerce University of Delhi on 2nd November 2016 during VigilanceAwareness Week 2016. Several leading colleges of University of Delhi participated in theevent that proved to be thought-provoking. A link of the event is available on You-Tube athttps://www.youtube.com/watch?v=6QHTXgQZYiY.
Vigilance Study Circle Hyderabad has conferred "Vigilance ExcellenceAward-2016" to Vigilance Division of CONCOR.
It was received by Sh Ashish Bhargav Sr Manager/Technical Corporate Office. Smt.Sushmita Singh Dy. Manager (Vigilance)/ CONCOR has received "Vigilance ExcellenceAward 2016-17" from Institute of Public Enterprise Hyderabad.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 your Directors hereby confirmthat: i. In the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures. ii. TheDirectors have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the company at the end of the financial year and of the profitand loss of the company for that period. iii. The Directors have taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act 2013 for safeguarding the assets of the company and forpreventing and detecting fraud and other irregularities. iv. The Directors have preparedthe annual accounts on a going concern basis. v. The Directors have laid down internalfinancial controls to be followed by the company and that such internal financial controlsare adequate and were operating effectively. vi. The directors have devised proper systemsto ensure compliance with the provisions of all applicable laws and that such systems wereadequate and operating effectively.
MANAGEMENT DISCUSSION AND ANALYSIS
The detailed Management Discussion and Analysis forms a part of this report atAnnexure-A.
CORPORATE GOVERNANCE & GREEN INITIATIVE
Your Company has taken structured initiatives towards Corporate Governance & itspractices are appreciated by various stakeholders. Your Company believes in the principlethat good Corporate Governance establishes a positive organizational culture and it isevident by responsibility accountability consistency fairness and transparency towardsits stakeholders. As required under SEBI (LODR) Regulations and DPE guidelines onCorporate Governance a separate report on Corporate Governance practices followed by theCompany forms part of this Report at Annexure-B.
A Practicing Company Secretary has examined and certified your Company's compliancewith respect to conditions enumerated in SEBI (LODR) Regulations and DPE guidelines onCorporate Governance. The certificate forms part of this
Report at Annexure- C.
As a responsible corporate citizen and to reduce carbon foot print your Company hasactively supported the implementation of Green Initiative'. Electronic delivery ofnotice of Annual General Meeting (AGM) and Annual Report is being done to thoseshareholders whose email ids are already registered with the respective DepositoryParticipants (DPs) and downloaded from the depositories i.e. NSDL/CDSL and who have notopted for receiving Annual Report in physical form. Accordingly unless otherwise desiredby the shareholders the Company sends all documents to the shareholders viz. NoticeAudited Financial Statements Directors' and Auditors' Report etc. in electronic form totheir registered e-mail addresses.
BUSINESS RESPONSIBILITY REPORT
For describing the initiatives taken by the companies from Environmental Social andGovernance perspective under SEBI (LODR) Regulations it has been mandated that the top500 listed entities based on market capitalisation to include Business ResponsibilityReport (BRR) as part of the Annual Report. SEBI has also issued circular no.CIR/CFD/CMD/10/2015 dated 04.11.2015 providing the format for BRR reporting in which it haselaborated a disclosure framework mapping company's performance on the nine Principles andCore elements. Accordingly in compliance to the said circular and provisions of SEBI(LODR) Regulations the Business Responsibility Report (BRR) is contained in a separatesection in the Annual Report.
CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT
CONCOR impetus towards sustainable development of all its stakeholders by undertakingvarious welfare activities under its CSR initiatives continued like previous years. As pernew Companies Act 2013 CONCOR has formulated its CSR policy for the benefit of differentsegments of the society specifically the deprived underprivileged persons groupsentities etc.
CONCOR has two Tier CSR Committee system for implementing it's CSR activities. TheTier-I committee is headed by Chairman & Managing Director including One IndependentDirector as it's member. The Tier-II committee is headed by
ED(MIS & CSR) including two other senior officers & assisted by Sr. Manager (OL& CSR).
Under CONCOR's CSR policy various thrust areas have been identified in accordance withthe provisions of Companies
Act 2013 and include health & medical care sanitation education/literacyenhancement community development and rehabilitation measures environment protectionconservation of natural resources natural calamities and infrastructure developmentrural development etc.
CONCOR has executed it's major projects in the area of education health sanitationskill development & environment sustainability. Some of it's CSR initiatives are asunder:
_ Solar lights have been provided in the un electrified rural areas of BhadohiPhoolpur Shrawasti and Gazipur districts of Uttar Pradesh to benefit a large number ofrural population as well as to improve their quality of life.
_ Realizing the importance of providing education to girl child in society it hasprovided infrastructural support to girls inter Collages in states of Maharashtra OdishaHaryana and Chattishgarh paving the way for better future of society by furthering thecause of girl education.
_ Company has been proactive towards providing better health to its stakeholders& people residing near it's facilities. For this purpose it has organized 78 healthcamps at it's 25 major terminals ranging from Tughlakabad (Delhi) to Tondiyarpet (Chennai)and Amingaon (Assam) to Khodiyar (Ahemdabad) to cover all parts of country to providepreventive health care facility to its stakeholders on quarterly basis through whichnearly 56000 stakeholders have been benefited. These health camps cater to the basicmedical requirement like sugar BP E&T examination physiotherapy and freedistribution of medicines. Approximately 7800 near vision spectacles distributed free ofcost to beneficiaries in such camps. Company is quite sensitive towards people withdisabilities and has distributed artificial assistive devices to nearly 500 suchbeneficiaries in the campsorganized at its facilities during the year of report.
_ Various skill development activities such as imparting training to OBC youths in15 states through National Backward Classes Finance & Development Corporation gotcompleted. Skill development training has also been provided to 500 SC youths in twodistricts of Uttar Pradesh in order to enable them to earn their livelihood on their own.Women belongings from SC/ST/OBC communities were provided training in beauty culture fortheir sustainable development in society.
_ CONCOR is also contributing in upgrading passengers amenities at railwaysstations by providing water cooler track cleaning machines bio toilets dry dustbinssolar panels etc at various railway stations including New Delhi and Vadodara stations ofIndian Railways in order to provide better facilities to railways passengers.
_ Similar to previous years CONCOR continued to contribute in Swachh BharatKosh' set by Govt. of India for construction of toilet blocks in schools which have notoilet facility.
_ CONCOR continued its support to destitute children of society by helping them intheir education by arranging their education through Godhuli' in New Delhibenefiting such children.
_ In order to support economically weaker children to pursue higher studies CONCORsupported 30 such children in eastern district of Uttar Pradesh by providing free coachingas well as fooding & lodging for preparing higher courses like JEEUPTU WBJEE etc.
_ CONCOR CSR activities are not limited to urban areas only it has constructedPerishable Cargo Centre at Ghazipur Uttar Pradesh in order to save fruits and vegetablesgetting wasted and ensuring better return to farmers who can store their surplus agriproducts in the PCC and earn more in order to strengthen their economics.
_ In order to discourage drop outs and promote sanitation in schools toiletsblocks have been built in schools of Basti Gautambudh Nagar Uttar Pradesh BhiwaniHaryana Kinnur Kerala.
_ CONCOR is more caring to the sections of society which is deprived orphanedabandoned neglected which is why it has provided them buildings shelters etc in Delhi andOdisha.
_ Out of the funds allocated as per Companies Act 2013 towards CSR Expenditure forFY 2016-17 an amount of `24.45 crores has been disbursed towards various CSR activitiesduring the year.
CONCOR is fully committed to benefits its stakeholders welfare activities forsustainable development of society especially who need it most. The particulars of CSRactivities for the year in the form of the Annual Report on CSR activities is as perAnnexure-D to this report.
As per the requirement of SEBI (LODR) Regulations 2015 the Company is having a Boardlevel Risk Management Committee. The particulars of Committee are stated in the CorporateGovernance Report forming part of this Report. The Company has a well laid down RiskManagement (RM) system to identify evaluate risks and opportunities. The said systemseeks to create transparency minimize adverse impact on the business objectives andenhance the Company's competitive advantage. The risk management system defines the riskmanagement approach across the enterprise in various business activities. The RM structurehas different risk models which help in identifying risks trend exposure and potentialimpact analysis at Company level and also separately for business segments. It forms anintegral part of the Company's functioning and the Board of Directors are being regularlyapprised about the status of various risk elements and the mitigation plans for the same.
INTERNAL CONTROL SYSTEMS AND ITS ADEQUACY
CONCOR's Internal Control Systems are commensurate with its size scale and complexityand nature of its business activities. Internal audit constitutes an important element inoverall internal control systems of the company. The scope of work of the internal auditis well defined and is very exhaustive to cover all crucial functions and businesses ofthe company. The internal audit in the company is carried out by the independentprofessional firms appointed for this purpose. Further the internal financial controlswith reference to the Financial Statements are adequate.
The respective department of the company monitors and evaluates the efficacy andadequacy of internal control system in the Company its compliance with operating systemsand accounting procedures and policies. Based on the report of internal auditors'necessary steps are taken at regular intervals to further strengthen the existing systemsand procedures. The significant observations of internal auditors and corrective actionsthereon are presented to the Audit & Ethics Committee of the Board at regularintervals.
PARTICULARS OF EMPLOYEES
The information required along with the disclosures to be made in accordance with theprovisions of Section 197(12) of the Companies Act 2013 read with the Rule 5 of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 as amended from time totime is as per Annexure-E and forms part of this report.
Being a Government Company the Comptroller & Auditor General (C&AG) of Indiahad appointed Company's Statutory and Branch/Regional Auditors for the financial year2016-17. M/s. Arun K Agarwal & Associates Chartered Accountants has been appointed asCompany's Statutory Auditors for the year 2016-17. The statutory auditors were appointedby C&AG vide its letter No.CA.V/COY/CENTRAL GOVERNMENTCCIL(9)/1292 dated 01.09.2016.The Statutory Auditors of the company is being paid an audit fee of `400000/-. TheStatutory Auditors have audited the Annual Financial Statements of the Company for thefinancial year ended on 31.03.2017.
The comments of the Comptroller and Auditor General (C&AG) of India through letterNo. PDA/RC/RPSU/32-65/
CONCOR/2017-18/377 dated 21st August 2017 on the Audited Financial Statements of yourCompany for the financial year ended 31.03.2017 under the Companies Act 2013 have beenreceived. The Comments of C&AG for the financial year 2016-17 along with the StatutoryAuditors Report of your company have been placed elsewhere in this Annual Report.
BOARD OF DIRECTORS
During the financial year 2016-17 eight meetings of the Board of Directors were heldfor transacting various businesses.
During the year and upto the date of this report the directorship in the company areunder:
- Shri V . Kalyana Rama Chairman and Managing Director w.e.f. 01.10.2016 [DIN:07201556] [Director (Projects Services) upto 30.09.2016]
- Dr . P. Alli Rani Director (Finance) & CFO [DIN: 02305257]
- Shri Pradip K. Agrawal Director (Domestic Division) [DIN: 07557080] (w.e.f.01.07.2016)
- Shri Sanjay Swarup Director (Intl. Mktg. & Ops.) [DIN: 05159435] (w.e.f.01.09.2016.)
- Shri S. K. Sharma Govt. Nominee Director [DIN: 07522844] (w.e.f. 22.05.2016)
- Shri Sanjay Bajpai Govt. Nominee Director [DIN: 07549036] (w.e.f. 01.07.2016)
- Shri Kamlesh Shivji Vikamsey Independent Director [DIN: 00059620] (w.e.f.05.04.2016)
- Maj. Gen. (Retd.) Raj Krishan Malhotra Independent Director [DIN: 07483272] (w.e.f.05.04.2016 and upto 16.06.2017)
- Shri Sanjeev S. Shah Independent Director [DIN: 00323163] (w.e.f. 05.04.2016)
- Shri Anil Kumar Gupta Chairman and Managing Director [DIN: 00066328] (upto30.09.2016)
- Shri Yash Vardhan Director (Intl. Mktg. & Ops.) [DIN: 01842119] (upto31.08.2016)
- Shri Arvind Bhatnagar Director (Domestic Division) [DIN: 03564703] (upto 30.06.2016)
- Shri Manoj K. Akhouri Govt. Nominee Director [DIN: 02293829] (upto 25.04.2016)
Shri Manoj K. Akhouri part-time Government director ceased to hold the office ofdirector CONCOR w.e.f. 25.04.2016 as they relinquished the charge of duty from the post ofEDTT(F) Railway Board. CONCOR being a Government company the directors on its board areappointed by the Ministry of Railways from time to time. Shri S. K. Sharma was appointedpart-time government director w.e.f. 22.05.2016 as per order no. 2004/PL/51/3 dated06.05.2016 of Ministry of Railways. Shri Sanjay Bajpai was appointed part-time governmentdirector w.e.f. 01.07.2016 as per order no. 2004/PL/51/3 dated 10.06.2016 of Ministry ofRailways. Shri Pradip K. Agrawal was appointed Director (Domestic Division) w.e.f.01.07.2016 as per order no. 2015/E/(O)II/40/6 dated 30.06.2016 of Ministry of Railways.Shri Sanjay Swarup was appointed Director (International Marketing & operations)w.e.f. 01.09.2016 as per order no. 2015/E/(O)II/40/7 dated 05.07.2016 of Ministry ofRailways. Shri V. Kalyana Rama was appointed Chairman and Managing Director w.e.f.01.10.2016 as per order no. 2015/E/(O)II/40/13 dated 30.09.2016 of Ministry of Railways.
In terms of order of the Ministry of Railways Government of India three non-officialpart-time (Independent) Directors were appointed on the Board of CONCOR on 05.04.2016.These Independent Directors were Shri Kamlesh Shivji Vikamsey Maj. Gen. (Retd.) RajKrishan Malhotra & Shri Sanjeev S. Shah. Maj. Gen. (Retd.) Raj Krishan Malhotra nowceased to be a director of CONCOR due to his sudden and untimely demise on 16.06.2017.CONCOR had already requested Ministry of
Railways for appointment of five new independent directors in place of the independentdirectors who has either resigned or whose tenure has ended earlier.
RETIREMENT OF DIRECTORS BY ROTATION
As per the Companies Act 2013 the provisions in respect of retirement of Directors byrotation will not be applicable to Independent Directors. In view of this no IndependentDirector is considered to be retiring by rotation but all other directors will be retiringby rotation. Accordingly one third among all other directors namely Dr. P. Alli Rani andShri S. K. Sharma are liable to retire by rotation and being eligible offer themselvesfor reappointment.
EVALUATION & REMUNERATION
As per Section 134 (3)(p) of the Companies Act 2013 the Board's Report of a ListedCompany shall include a statement indicating the manner of formal annual evaluation ofBoard Individual Directors etc. The MoU signed between the company and the Govt. of Indiadetails out the parameters and initiatives that the company is required to undertakeduring that financial year. This MoU is evaluated at the end of the year by the Govt. anda performance rating is assigned to CONCOR based on its performance on the spelt outparameters. The terms of reference of Board Level Committees are approved by the Board.The minutes of Board Level Committees are placed before the Board for its perusal.Further there is a well laid down procedure for evaluation of CMD and FunctionalDirector's performance. Department of Public Enterprises (DPE) has designed a format andlaid down a procedure for filling up and evaluation of the Director's performance. As soonas the concerned Director does self assessment his evaluation is done next by CMD thenby Secretary Heavy Industries and closed by the Minister-in-Charge. The tenure ofFunctional Directors as spelt out in their Terms and Conditions of
Appointment is five years or the date of their superannuation whichever is earlier.
As per Schedule IV of the Companies Act 2013 on the basis of performance evaluationof Independent Directors it shall be determined whether to extend or continue their termof appointment. Since the appointment of the Independent Directors is decided by the Govt.of India and as the tenure of Independent Directors is normally for a period of threeyears also as decided by the Govt. of India the Board is not in a position to decidetheir continuance or otherwise on the basis of performance evaluation. Ministry ofCorporate Affairs has vide its notification dated 5th June 2015 notified the Exemptionsto Government Companies from the provisions of the Companies Act 2013 which inter-aliaprovides that Sec. 134(3) (p) regarding statement on formal annual evaluation shall notapply to Government Companies in case the Directors are evaluated by the Ministry which isadministratively in-charge of the company as per its own evaluation methodology. Furtherin line with aforementioned exemptions Sub-Sections (2) (3) & (4) of Sec. 178regarding appointment performance evaluation and remuneration shall not apply toDirectors of Government Companies.
CONCOR is a Government Company under the administrative control of Ministry ofRailways. The selection procedure for all the directors is also laid down by theGovernment of India and all the directors of the company have been appointed in accordancewith the said procedure. The functional directors including CMD are selected on therecommendations of PESB in accordance with the procedure and guidelines laid down by Govt.of India. Its Board of Directors are appointed by Ministry of Railways and there is systemand procedure laid down by Department of Public Enterprises for evaluation of itsfunctional directors including Chairman and Managing Director. The evaluation frameworkfor assessing the performance of functional directors comprises of the following keyareas: Performance of the company under the MOU signed with Ministry of Railways.
Performance with respect to the targets fixed for the respective director.
The evaluation includes self evaluation by the respective board member andsubsequent assessment by CMD for the functional directors and thereafter final evaluationby the Ministry of Railways the administrative ministry.
In respect of CMD the evaluation includes self evaluation and final evaluation bythe Ministry of Railways.
The independent directors in their separate meeting have also evaluated all other boardmembers of the company and the same was found to be satisfactory. In respect of Governmentnominee directors their evaluation is done by the Ministry of Railways as per theprocedure laid down. The evaluation of independent directors is done by the board of thecompany.
The induction of officers at below board level is made by way of recruitment promotionand/or lateral entry by way of deputation/immediate absorption of the officials fromMinistry of Railways Govt. Departments and other PSUs. The performance of below BoardLevel Officials at Group General Manager and Executive Director grades is evaluated on thebasis of the achievement of MOU targets as approved by Administrative Ministry and DPE.The performance of Functional Directors is evaluated by the Administrative Ministry i.e.Ministry of Railways.
CONCOR follows a robust Performance Management System (PMS) in compliance with the DPEinstructions for evaluation of performance of its officials in Sr. General Manager andbelow grade. Format for evaluation comprises broad parameters for assessment of personaltraits of the officials such as integrity communication cost consciousness planning andorganizing job knowledge continuous improvement people management collaborationinitiatives etc. and contribution of the official towards financial performance of theorganization. The Key Result Areas (KRAs) are proposed by the appraisee and approved byappraiser in the beginning of the year which is subject to mid-year review for furthermodification/improvement if any. The officialsare rated for their performance and BellCurve approach is followed for payment of Performance Related Pay (PRP) as per DPEguidelines/instructions in this regard suitably modified on the basis of ASCI(Administrative Staff College of India) recommendations for your company.
CONCOR being a Government company the remuneration payable to its functional directorsincluding CMD senior management officials and all other employees is in accordance withthe guidelines issued by Department of Public Enterprises (DPE) in pursuance ofrecommendations of the committee on pay revision. For fixation of remuneration at workmenlevel CONCOR adopts collective bargaining method with registered trade union of workmen.For supervisors & officers pay scales have been designed in a progressive way and allstatutory compliances in this regard are being adopted and followed. It is being takencare of that no employee gets stagnated.
The Nomination & Remuneration Committee had taken note of the remuneration policyof the company and the procedure and policy for selection of the Directors SeniorManagement and their remuneration.
RELATED PARTY TRANSACTIONS
The related party transactions that were entered into during the year were on an arm'slength basis and were in the ordinary course of business. Omnibus approval of the Audit& Ethics Committee was taken for the related party transactions which are of foreseenand repetitive nature. The transactions entered into pursuant to the omnibus approval sogranted are placed before the Audit & Ethics Committee and the Board of Directors on aquarterly basis. The policy on related party transactions as approved by the Board isuploaded on the Company's website at http://www.concorindia.co.in/assets/pdf/
CONCOR_Policy_MRPT.pdf. Though there are no materially significant related partytransactions entered by the company the particulars as required under section 134(3) ofthe Companies Act 2013 are as per Annexure-F to this report.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed M/s Akhil Rohatgi & Company a firm of Company Secretaries in Practice toundertake the Secretarial Audit of the Company. The Secretarial Audit Report from theauditor is annexed as Annexure-G to this report.
The Secretarial Auditor as well as the Auditor who has given Corporate GovernanceCompliance certificate had observed that the company is not having adequate number ofindependent directors. The remarks of the directors on the same are that the independentdirectors in the company are appointed by President of India through Ministry ofRailways Government of India. The Company has repeatedly requested Ministry of RailwaysGovernment of India for appointment of requisite number of independent directors on itsBoard. It is learnt that Ministry of Railways is in the process of appointing remainingrequired number of independent directors on the Board of CONCOR.
The particulars forming part of the extract of the Annual Return in the form MGT- 9 isannexed as Annexure-H. In addition Statement pursuant to Section 129 of the Companies Act2013 (AOC-1) relating to Subsidiary Companies and Joint Ventures are as per Annexure-I.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
During the year your company has made investments and has disbursed loans to itssubsidiaries and joint ventures. The particulars of which are as under:
| || || ||( ` in Crore) |
|S.No ||Name of Company ||Loan/Investment ||Amount |
|1. ||M/s Fresh & Healthy Enterprises Ltd. Wholly Owned Subsidiary ||Loan disbursed ||4.45 |
| || ||Loan recovered ||Nil |
| || ||Investment made by converting loan into equity ||Nil |
|2. ||M/s Punjab Logistics Infrastructure Ltd. Subsidiary ||Equity investment* ||15.30 |
* Investments were made towards subscription of equity shares of `10 each for cash atpar.
The above loan disbursed to M/s Fresh & Healthy Enterprises Ltd. (FHEL) during theyear 2016-17 for `4.45 crores is bearing interest rate of 8.51% p.a. Your company has notaccepted deposits from public as envisaged under Sections 73 to 76 of Companies Act 2013read with Companies (Acceptance of Deposit) Rules 2014.
DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013
Container Corporation of India Ltd. (CONCOR) prohibits any kind of act of sexualharassment at work place and included the acts amounting to sexual harassment at workplacein its Conduct Rules and Certified Standing orders (as certified in
1998) and Discipline & Appeal Rules so as to prohibit any such Act. CONCORconstituted an Internal Complaints Committee in the year 2003 to receive and investigatecomplaints related to "Sexual harassment at workplace" following the guidelinesissued by Hon'ble Supreme Court of India in "Visakha Vs. State of Rajasthan".The then committee included Senior Officer with Executive Director as its chairperson.
The company has re-constituted the Internal Complaints Committee' consisting offour members at the senior level including one external female member who is an advocateon record of Hon'ble Supreme Court of India. CONCOR has 166 female employees out of total1474 employees. The company has created a conducive work environment free from any kind ofharassment.
Only one complaint was received during the FY 2016-17 which was found to be anadministrative complaint.
CEO & CFO CERTIFICATION
Certificate from Shri V. Kalyana Rama Chairman and Managing Director and Dr. P. AlliRani Director (Finance) & CFO pursuant to provisions of Regulation 17(8) of the SEBI(LODR) Regulations for the year under review was placed before the Board of Directors ofthe Company at its meeting held on 25.05.2017. A copy of the said certificate on thefinancial statements for the financial year ended 31st March 2017 is as perAnnexure-J.
CODE OF CONDUCT
The Code of Conduct has been laid down for the Board Members and senior management. Acopy of the same is available on the website of the Company.
Based on the affirmation received from Board Members and Senior Management Personnelit is hereby declared that all the members of the Board and Senior Management Personnelhave affirmed compliance of Code of Conduct for the financial year ended on 31.03.2017.
Your Directors express their gratitude for continued co-operation support and guidancein effective management of company's affairs and resources provided by Government ofIndia in particular the Ministry of Railways Customs Ports and above all the customerswho have continued to patronize the services provided by your Company. The Directors alsoplace on record their sincere appreciation for the continued support and goodwill of theesteemed Shareholders Institutions State Governments where company operates or isplanning to expand its business and all other agencies who have helped your company indelivering excellent performance. Your Directors acknowledge the constructive suggestionsreceived from Statutory Auditors and Comptroller and Auditor General of India and aregrateful for their consistent support and help. Last but not the least Your Directorswould like to place on record its deep and sincere appreciation for the hard workdedication valuable contribution and unstinted efforts by the team CONCOR in steering thecompany to excellent performance and ensuring that it achieves greater milestones andscales the newer pinnacle of success. For and on behalf of the Board of Directors
| ||Sd/- |
|Date: 23.08.2017 ||(V. Kalyana Rama) |
|Place : New Delhi ||Chairman & Managing Director |