For the year ended 31st March 2016
The Directors have pleasure in submitting the Annual Report and Audited FinancialStatements of the Company for the year ended 31st March 2016.
|Particulars || |
|FY-16 ||FY-15 ||FY-16 ||FY-15 |
|Net Revenue ||204.31 ||175.30 ||6437.95 ||3514.12 |
|Profit before interest depreciation and tax (EBITDA) ||90.84 ||40.78 ||1742.82 ||695.85 |
|Less: Interest and Financial Charges ||1.70 ||0.31 ||725.64 ||434.38 |
|Profit before depreciation and tax (PBDT) ||89.14 ||40.47 ||1017.18 ||261.47 |
|Less: Depreciation ||2.94 ||3.66 ||452.76 ||271.58 |
|Profit/(loss) before exceptional item and tax ||86.20 ||36.81 ||564.42 ||(10.11) |
|Exceptional Items ||- ||- ||- ||(6.12) |
|Profit/(loss) before tax ||86.20 ||36.81 ||564.42 ||(16.23) |
|Provision for current tax ||20.54 ||11.82 ||132.36 ||13.36 |
|Provision for deferred tax ||(0.63) ||(0.39) ||166.84 ||35.92 |
|Prior year tax charge ||0.74 ||0.28 ||(0.12) ||(2.42) |
|Profit/(loss) after tax before share of profit in associates ||65.55 ||25.10 ||265.34 ||(63.09) |
|Add: Share of profit in associates ||- ||- ||- ||48.53 |
|Less: Share of minority interest ||- ||- ||74.53 ||(17.61) |
|Profit/(loss) after tax ||65.55 ||25.10 ||190.81 ||3.05 |
|Add: Surplus brought forward ||77.83 ||70.19 ||58.50 ||292.91 |
|Add: Amount transferred from debenture redemption reserve ||- ||- ||95.83 ||32.50 |
|Add: Provision for dividend Distribution tax written back ||1.64 ||- ||1.64 ||- |
|Less: Depreciation on account of change in useful life of assets as per Companies Act 2013 ||- ||0.22 ||- ||5.13 |
|Profit available for appropriation ||145.02 ||95.07 ||346.78 ||323.33 |
|Appropriations: || || || || |
|Debenture Redemption Reserve ||- ||- ||130.20 ||113.96 |
|General Reserve ||- ||2.51 ||- ||122.51 |
|Reserve fund as per RBI ||- ||- ||0.28 ||- |
|Proposed Dividend/Interim Dividend ||17.76 ||12.18 ||23.53 ||19.32 |
|Dividend Distribution tax thereon ||0.42 ||2.55 ||5.05 ||7.18 |
|Distribution tax on dividend from Associates ||- ||- ||- ||1.86 |
|Balance carried forward ||126.84 ||77.83 ||187.72 ||58.50 |
| ||145.02 ||95.07 ||346.78 ||323.33 |
OPERATIONS AND BUSINESS PERFORMANCE
Please refer to the Chapter on Management Discussion and Analysis for a detailedanalysis of the performance of the Company during the financial year 2015-16.
Your Directors had distributed an Interim Dividend of 100% per share amounting to H2.00per equity share of face value of H2/- each in March 2016 to those Shareholders holdingshares on 23-3-2016.
Your Directors have decided not to recommend any final dividend and to treat theinterim dividend paid as the final dividend for the financial year 2015-16.
CHANGES IN BUSINESS
There have been no changes in business carried on by the Company during the year.
CORPORATE GOVERNANCE REPORT
The Company's corporate governance practices have been detailed in a separate Chapterand is attached separately to this Report together with the Auditor's certificate thereon.
SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES
The report on the financial position of the Company's Subsidiaries for the year ended31st March 2016 in Form AOC 1 is attached and marked as Annexure-1 to this report.
The Company has 38 subsidiaries including step down subsidiaries namely Dalmia Cement(Bharat) Limited Dalmia Power Limited DCB Power Ventures Limited Kanika InvestmentLimited Adwetha Cement Holdings Limited and the Subsidiaries of Dalmia Cement (Bharat)Limited viz. Ishita Properties Limited Shri Rangam Properties Limited Geetee EstatesLimited D. I. Properties Limited Hemshila Properties Limited Arjuna Brokers &Minerals Limited Shri Radha Krishna Brokers & Holdings Limited Dalmia Minerals &Properties Limited Sri Subramanya Mines & Minerals Limited Sri Swaminatha Mines& Minerals Limited Sri Shanmugha Mines & Minerals Limited Sri DhandauthapaniMines and Minerals Limited Sri Trivikrama Mines and Properties Limited Sri MadhusudanaMines and Properties Limited Cosmos Cements Limited Sutnga Mines Private LimitedRajputana Properties Private Limited Golden Hills Resort Private Limited Calcom CementIndia Limited Vinay Cement Limited SCL Cements Limited RCL Cements Limited AdhunikCement Limited Adhunik MSP Cement (Assam) Limited Dalmia Bharat Cements HoldingsLimited Shri Rangam Securities & Holdings Limited JayeVijay Agro Farms PrivateLimited Dalmia Cement East Limited Bangaru Kamakshiamman Agro Farms Private Limited OCLIndia Limited OCL Global Limited OCL China Limited and Odisha Cement Limited.
During the year under review Bangaru Kamakshiamman Agro Farms Private Limited andAdwetha Cement Holdings Limited became subsidiaries of the Company w.e.f. 29th April 2015and 2nd March 2016 respectively.
During the said financial year no company ceased to be a subsidiary of the Company orits Subsidiary.
Apart from this the Company's Subsidiary Dalmia Cement (Bharat) Limited has one jointventure company Khappa Coal Company Private Limited and OCL India Limited the step downsubsidiary has one joint venture company Radhikapur (West) Coal Mining Private Limited.
Any Member desirous to inspect the detailed Annual Reports of any of the aforementionedsubsidiaries may inspect the same at the Registered Office of the Company during businesshours. The same are also posted on the Company's website www.dalmiabl.com .
The policy for determining material subsidiaries may be accessed at the Company'swebsite at http://www.dalmiabl.com/upload/ policies/DBL-Material-Subsidiary-Policy.pdf
During the year under review two Schemes of Arrangement and Amalgamation involvingthe following subsidiaries/step down subsidiaries of the Company their respectiveshareholders and creditors have been approved by the respective board of directors ofsaid companies:
(i) Scheme No.1 amongst OCL India Limited Dalmia Cement East Limited Shri RangamSecurities & Holdings Limited Dalmia Bharat Cements Holdings Limited and OdishaCement Limited;
(ii) Scheme No. 2 amongst Adwetha Cement Holdings Limited
DCB Power Ventures Limited Dalmia Power Limited and Dalmia Cement (Bharat) Limited.
The said Schemes are expected to be filed before the respective High Courts havingjurisdiction over the Registered Office of the aforesaid companies shortly.
CONSOLIDATED FINANCIAL STATEMENTS
In compliance with Section 129(3) of the Companies Act 2013 and the AccountingStandard 21 on Consolidated Financial Statements this Annual Report also includesConsolidated Financial Statements for the financial year 2015-16.
The revised Consolidated Financial Statements attached with this report have beenprepared based on audited Financial Statements of all the subsidiaries includingsub-subsidiaries of the Company. In this regard attention is invited to note No. 32B andnote No. 62 of the Consolidated Financial Statements of the Company for the year ended31st March 2016 which fully explains the matter and replies to the Auditors observationunder "Emphasis of Matter".
EXTRACT OF ANNUAL RETURN
In compliance with sub-section (3) of section 92 of the Companies Act 2013 the extractof the Annual Return is attached in Form MGT- 9 and forms part of this report asAnnexure-2.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Independent Directors namely Mr. N. Gopalaswamy Mr. V.S. Jain and Mr. P.K.Khaitan have given their declaration of independence in terms of section 149 of theCompanies Act 2013. During the year two meetings of the Independent Directors excludingall other Directors and Officials of the Company were held as mandated by the provisionsof Rule 8 of Schedule IV to the Companies Act 2013 wherein they apprised the performanceof the Executive Directors.
The details of familiarisation programmes imparted to the Independent Directors of theCompany during the financial year 2015-16 can be accessed at the website of the Company athttps://www.dalmiabl.com/upload/Familiarisation-Programme-for- ID-2015-16.pdf .
Mr. Gautam Dalmia Director retires by rotation at the ensuing Annual General Meetingand being eligible offers himself for reappointment. Mr. Gautam Dalmia has given hisdeclaration in terms of Section 164(2) of the Companies Act 2013 to the effect that he isnot disqualified from being reappointed as a Director of the Company.
The term of Key Managerial Persons namely Mr. Jai H. Dalmia and Mr. Y.H. DalmiaManaging Directors expired on 31-3-2016 and 10-2-2016 respectively. Mr. Y.H. Dalmia hasbeen re-appointed as Managing Director w.e.f. 11-2-2016 for a further period of threeyears and Mr. Jai H. Dalmia has been re-appointed as Managing Director w.e.f. 1-4-2016 fora further period of three years. Their appointments are subject to the approval ofshareholders at the ensuing Annual General Meeting. The Company has received Notices fromthe respective individual Directors as required under section 160(1) of the Companies Act2013 proposing their names for appointment as Managing Directors of the Company. Mr. Y.H.Dalmia and Mr. Jai H. Dalmia have given their declaration in terms of Section 164(2) ofthe Companies Act 2013 to the effect that they are not disqualified from being appointedas Managing Directors
of the Company. Other Key Managerial Persons namely Mr. Jayesh Doshi Group CFO andWhole-time Director and Ms. Nidhi Bisaria Company Secretary continue to hold theirrespective offices during the year under review.
The Nomination and Remuneration Policy of the Company on Director's appointment andremuneration including criteria for determining qualifications positive attributesindependence of the Directors and other matters provided in section 178(3) of theCompanies Act 2013 has been approved by the Board of Directors on the recommendation ofthe Nomination and Remuneration Committee. The Nomination and Remuneration Policy isattached as Annexure-3 to this Report.
The Board of Directors have conducted a formal evaluation of its own performance and ofthe performance of its Committees and individual Directors in accordance with norms laiddown in the Nomination and Remuneration Policy aforesaid.
BOARD OF DIRECTORS COMMITTEES AND MEETINGS
Reference is invited to the attached Corporate Governance Report for the detailsthereof.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company has constituted the CSR Committee which has approved the CSR Policy. TheCommittee decided to expend an amount of H0.88 crore on CSR activities coveringeradication of extreme hunger and poverty promotion of education including specialeducation ensuring environmental sustainability and ecological balance etc. healthsanitation education and environment sustainability. Pursuant to the said policy theCompany has made expenses aggregating to H0.88 crore towards Corporate SocialResponsibility during the Financial Year 2015-16 which is more than 2% of average netprofits of the Company made during three immediately preceding financial years.
The CSR policy is available on the website of the Company at https://www.dalmiabl.com/upload/policies/DBL-CSR-Policy.pdf
The Annual Report on CSR activities in terms of Rule 8 of the Companies (CorporateSocial Responsibility Policy) Rules 2014 is attached as Annexure-4 and forms part of thisReport.
The Board of Directors of the Company has formed a Risk Management Committee to frameand monitor the Risk Management Plan of the Company. The Committee is responsible foridentifying critical risks framing Risk Management Plan and reviewing effectiveness ofimplementation of Risk Management Plan on ongoing basis. The purpose of Risk ManagementPlan is not to eliminate the risks inherent to the business but to proactively addresssuch risks. Major risks have been identified and actions to address them are underway.
RELATED PARTY POLICY AND TRANSACTIONS
The policy on related party transactions may be accessed at the Company's website athttp://www.dalmiabl.com/upload/policies/ DBL-Related-Party-Policy.pdf
The particulars of material contracts or arrangements with the related parties referredto in section 188(1) of the Companies Act 2013 is attached in Form AOC 2 and forms partof this Report as Annexure-5.
INVESTMENTS LOANS AND GUARANTEES
The particulars of investments made and securities/guarantees given by the Company arefurnished in Note Nos. 11 and 26 of the Standalone Financial Statements of the Company.The details of loans given by the Company are furnished in Note Nos. 40 and 41 of theStandalone Financial Statements of the Company.
ADEQUACY OF INTERNAL FINANCIAL CONTROLS
Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company (with its inherent weaknesses) work performedby the internal statutory and secretarial auditors and external consultants speciallyappointed for this purpose including audit of internal financial controls over financialreporting by the statutory auditors and the reviews performed by management and therelevant Board committees including the audit committee the Board is of the opinion thatthe Company's internal financial controls were adequate and effective during the periodended on 31st March 2016.
WHISTLE BLOWER POLICY ANDVIGIL MECHANISM
The Company has in place the Whistle Blower Policy and Vigil Mechanism with a view toprovide for adequate safeguards against victimisation of persons who use such mechanismand provide for direct access to the Chairperson of the Audit Committee in appropriatecases.
The policy can be accessed at the website of the Company at https://www.dalmiabl.com/upload/ policies/ DBL-Whistle-Blower- Policy-Vigil-Mechanism.pdf.
DIRECTORS' RESPONSIBILITY STATEMENT
In terms of the provisions of Section 134(3)(c) read with section 134(5) of theCompanies Act 2013 your Directors state that:
(a) in the preparation of the annual accounts the applicable Accounting Standards havebeen followed along with proper explanation relating to material departures;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgements and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit of the Company for that period;
(c) the Directors had 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 frauds and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and
(f) the Directors had devised proper system to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
EMPLOYEES' STOCK OPTION SCHEME
The Human Resource Department and the Nomination and Remuneration Committee of theBoard of Directors of the Company administer the Employees' Stock Option Scheme of theCompany in accordance with the applicable SEBI Guidelines.
The disclosure as on 31st March 2016 (cumulative disclosure) as stipulated under theSEBI Guidelines with regard to the Employees' Stock Option Scheme is provided asAnnexure-6 to this Report.
M/s. S.S. Kothari Mehta & Co. were appointed as the Statutory Auditors of theCompany at the Annual General Meeting held on 30th September 2015 for a period of fiveyears in accordance with the provisions of section 139 of the Companies Act 2013 subjectto ratification by members of the Company every year. The Board recommends theratification of their appointment till the conclusion of the next following AnnualGeneral Meeting of the Company.
The Company has obtained from them a certificate to the effect that they are eligibleto continue as the Statutory Auditors of the Company and that they comply with therequirements prescribed in Section 141 of the Companies Act 2013.
SECRETARIAL AUDITOR AND REPORT THEREON
The Board of Directors of the Company appointed Mr. R. Venkatasubramanian PractisingCompany Secretary as the Secretarial Auditor to conduct the Secretarial Audit in terms ofsection 204 of the Companies Act 2013. The Report of Secretarial Audit is attached inForm MR 3 and forms part of this Report as Annexure-7.
COMMENTS ON AUDITORS' OBSERVATIONS
The Reports submitted by the Secretarial Auditors and Statutory Auditors on theStandalone Financial Statements of the Company do not contain any qualificationreservation or adverse remark.
LISTING OF SHARES
The Company's shares continue to remain listed on the National Stock Exchange andBombay Stock Exchange and the listing fees for the financial year 2016-17 has been paid tothe said Exchanges.
UNCLAIMED SUSPENSE ACCOUNT
In terms of Regulation 39(4) of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 the Company has opened the demat account.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE TRANSACTIONS
The particulars of energy conservation technology absorption are not applicable to theCompany as it is not engaged in any manufacturing activity. A statement giving details ofForeign Exchange transactions in accordance with the Companies (Accounts) Rules 2014forms a part of this report as Annexure-8.
PARTICULARS OF DIRECTORS' AND EMPLOYEES' REMUNERATION
The particulars of remuneration to Directors and Key Managerial Personnel and otherparticulars in terms of Section 197(12) read with Rule 5(1) of the Companies (Appointmentand Remuneration of Managerial Personnel) Rules 2014 are given in Annexure-9 to thisReport.
A statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in Rules 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are provided inAnnexure-10 to this Report.
Having regard to the provisions of the first proviso to Section 136(1) of the Act andas advised the printed copy of the Annual Report excluding the aforesaid information isbeing sent to the members of the Company. Any member interested in obtaining suchinformation may write to the Company Secretary and the same will be furnished on request.The full Annual Report including the aforesaid information is being sent electronically toall those members who have registered their email addresses and is also available on theCompany's website.
The Company has not accepted any deposits from public till date.
ORDERS PASSED BY REGULATORS
No order has been passed by the regulators or courts or tribunals impacting the statusof the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.
No such complaints have been received by the said Committee during the financial year2015-16.
OTHER REPORTABLE MATTERS
The Statutory Auditors have not reported any fraud to the Audit Committee or the Boardof Directors of the Company during the year under review.
The Directors wish to place on record their appreciation for the excellent cooperationreceived from all employees and stakeholders of the Company.
| || |
For and on behalf of the Board
|Place: New Delhi ||Jayesh Doshi ||Y.H. Dalmia |
|Dated: 17th August 2016 ||Whole-time ||Managing |
| ||Director & Group CFO ||Director |
| ||(DIN No. 00017963) ||(DIN No.00009800) |
PS.: Annexure mentioned in this Directors' Report other than the Corporate GovernanceReport and Management Discussion and Analysis are attached after the ConsolidatedFinancial Statements.
PARTICULARS WITH RESPECT TO FOREIGN EXCHANGE OUTGO AND EARNINGS
A. FOREIGN EXCHANGE EARNINGS AND OUTGO
(a) Activities relating to exports; initiatives taken to increase exports; developmentof new export markets for products and services and export plans:
(i) The Company has not undertaken any exports during the year under review.
(b) Total foreign exchange used and earned during the year:
(i) Used: Rs.0.30 crore
(ii) Earned: Rs. Nil crore