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GE Power India Ltd.

BSE: 532309 Sector: Engineering
NSE: GEPIL ISIN Code: INE878A01011
BSE LIVE 15:17 | 18 Oct 653.25 3.75
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NSE 15:31 | 18 Oct 653.75 0.75
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651.00

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656.50

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OPEN 651.65
PREVIOUS CLOSE 649.50
VOLUME 297
52-Week high 746.50
52-Week low 440.50
P/E 46.00
Mkt Cap.(Rs cr) 4,392
Buy Price 649.40
Buy Qty 15.00
Sell Price 652.90
Sell Qty 12.00
OPEN 651.65
CLOSE 649.50
VOLUME 297
52-Week high 746.50
52-Week low 440.50
P/E 46.00
Mkt Cap.(Rs cr) 4,392
Buy Price 649.40
Buy Qty 15.00
Sell Price 652.90
Sell Qty 12.00

GE Power India Ltd. (GEPIL) - Director Report

Company director report

Dear Shareholders

Your Directors present the 24 Annual Report of the Company along with the AuditedFinancial Statements for the financial year ended 31 March 2016 ('FY 2015-16').

FINANCIAL HIGHLIGHTS

(Rs in million)

Particulars For the year ended 31 March 2016 For the year ended 31 March 2015
Profits before Extraordinary items Tax Interest and Depreciation (516.5) 2918.3
Less: Interest/Finance Cost 35.1 10.4
Less: Depreciation 714.0 730.5
Profit before Tax (1265.6) 2177.4
Extraordinary item - Profit on sale of Business - 485.9
Profit before Tax (1265.6) 2663.3
Provision for Taxation
- Current Tax - (833.9)
- Deferred Tax 477.9 (58.7)
Profit after Tax (787.7) 1770.7
Balance brought forward from previous year 6845.4 5917.9
Charged in retained earnings where the remaining useful life of an asset is nil - (51.5)
Tax on depreciation directly against in the reserves - 17.5
Profit available for appropriation 6057.7 7654.6
Appropriations
a) Transferred to General Reserve - -
b) Proposed Dividend - (672.3)
c) Corporate Dividend Tax (Net) - (136.9)
Balance carried forward to Balance Sheet 6057.7 6845.4

DIVIDEND

Your Directors have not recommended any dividend for FY 2015-16.

STATE OF COMPANY'S AFFAIRS OPERATIONS - THE YEAR IN REVIEW

The Government of India (GoI) in its early years in office has demonstratedwillingness to take a firm stand on policies that support industry. It has implementedprocedural reforms across industry and infrastructure and tried to make it easier to dobusiness in India through a number of programs including 'Make in India' 'DigitalIndia' 'Start up India' etc. These initiatives however are yet to bear fruit and bothFY 2014-15 and FY 2015-16 have witnessed low to moderate industrial growth. At the sametime the legacy of subsidized power and leakages has resulted in higher AggregateTechnical & Commercial (AT&C) losses leading to financial distress for bothgeneration and distribution companies in the power sector.

Insufficient domestic gas supply meant that the gas- based power generation equipmentmarket remained muted in India with no utility scale order in FY 201516. Also there wasno large order for any hydro power generation project in India mainly due to issuespertaining to environment and forest.

Against this backdrop the Ministry of Power GoI has taken steps to revamp andstrengthen the entire power sector through a combination of its scheme Ujwal DiscomsAssurance Yojana (UDAY) and the New Tariff Policy 2015-16 which aims to create a win-winsituation for the producer distributor and consumer while providing 24x7 electricity forall. Further the draft notification of the new emission and water consumption norms forthe coal-based thermal power sector issued by the Ministry of Environment Forest andClimate Change (MoEF&CC) has enforced GoI's focus on clean power.

All these developments in the power sector have created opportunities and challengesfor the power equipment and services industry. The country's high rate of economic growthand continuing urbanization emphasize on the need for power. At the same time therealities of highly volatile fossil fuel prices and stricter environmental regulationsnecessitate generation of clean electricity utilising efficient means.

Your Company envisages a vital role for itself in India's growth. It can offerefficient equipment with minimal emissions further enhanced with the help of its digitalinitiatives.

STEAM POWER SYSTEMS

BOILERS

The Indian Coal market for FY 2015-16 stood at ~8.6 GW dominated by SupercriticalTechnology along with a small share of Ultra Supercritical Technology (USC). With GoI'sintent to reduce carbon footprint USC's share is likely to grow significantly in thecoming years. Your Company with more than 100 years of experience and proven marketleadership is well-positioned to offer its state-of-the-art efficient and smartsolutions for the power generation market in India.

Your Company's unit in Durgapur West Bengal is capable of manufacturing Supercritical& Ultra Supercritical Boilers equipped with the latest manufacturing technology.

Your Company in partnership with BHEL accomplished following milestones in the lastfiscal:

• 2 x 800 MW Sri Damodaram Sanjeevaiah Thermal Power Station Krishnapatnam Unit2 (APPDCL) - Commercial operation

• 1 x 700 MW Bellary Thermal Power Station (KPCL) - full load achieved

• 2 x 800 MW Yermarus Thermal Power Station Unit 1(RPCL) - full load achieved

• 3 x 660 MW Prayagraj Super Thermal Power Station Bara Unit 1 (JayPee Group) -Synchronized & full load achieved

• 2 x 660 MW Mouda Super Thermal Power Station Unit 1 (NTPC) - full load achievedMILLS

Your Company's wide range of mills caters to the requirement of various types andgrades of coal. Bowl and Beater wheel mills are widely accepted and used worldwide in thePower market.

The Shahabad unit which is the global manufacturing unit for coal mills has thefollowing accreditations:

• ISO 9001 : 2008 - Quality Management System

• ISO 14001 : 2004 - Environment Management System

• ISO 18001 : 2007 - Occupational Health and Safety Management System

• DIN EN ISO 3834 - 2 for welding of Pulverizer Mills and Components for PowerPlants.

Your Company won an order from Doosan Power Systems India Pvt. Ltd. for the supply ofcoal pulverizers for 1 x 660 MW Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd. -Harduaganj Project in the state of Uttar Pradesh.

Your Company is also currently executing following major projects:

• Your Company already dispatched majority of the HP Mills and all the bought outsfor 2 x 800 MW Darlipali Super Thermal Power Project Odisha India

• The supply order of 7 HP Mills for Mae Moh Power Plant Thailand is underprogress

• For the 2 x 660 MW Karabiga Ultra Super Critical Power Project Turkey yourCompany is currently working towards a supply order of 12 HP Mills

• Your Company is progressing to supply 16 Beater Wheel Mills with Classifier for2 x 500 MW Neyveli New Thermal Power Project Tamil Nadu India

ENVIRONMENTAL CONTROL SYSTEMS (ECS)

Globally 1.2 billion people lack electricity and out of this 240 million people are inIndia. The peak demand deficit for FY 2015-16 stood at 2.1%. These figures testify theneed for increased generation and supply of power. To be sustainable the benefits must bedelivered along with responsibility towards environment.

Your Company won an order to Supply Electrostatic Precipitators (ESP) for a 2 x 1000 MWCoal Fired Power Plant for Jimah East Power (JEP) at Jimah Malaysia. The scope of workincludes designing engineering manufacturing inspecting testing packing forwardingand delivering the ESP.

HYDRO

Hydropower is one of the cleanest and important sources of renewable energy in theworld. India has tapped only one-third of the potential and economically feasiblehydropower capacity so far. More than a century of development underlies your Company'sleadership in hydropower.

Due to stressed market conditions no major order for new large hydropower project wasplaced during the year. However your Company recently added a dedicated operation &Maintenance (o&M) department and had breakthroughs with two o&M contracts for morethan 100 MW size of hydropower plants.

The first major order was received from the Bhakra Beas Management Board (BBMB) for therefurbishment

of generator for the Dehar hydropower plant in Punjab. Renovation & Modernizationof 165 MW Hydro Generating Unit No. 6 at the Dehar Power house involves the replacement ofthe existing Stator Rotor Poles Pole Keys Air Guides and Temperature Recorders alongwith other allied items and Erection Testing and Commissioning.

Your Company was able to mark its presence in Bhutan by securing the complete controlsystem order for the Basochhu Hydropower Plant from the Druk Green Power CorporationLimited (DGPC). For this hydropower plant your Company will provide Engineering DesignSupply Installation Testing and Commissioning of ALSPA Control System includingdecommissioning of the existing system. In addition to these your Company also servedother export markets.

POWER SERVICES

Your Company offers a wide range of services to the installed base in India suppliedeither by your Company or by other manufacturers. Your Company has proven experience tosupport customers' needs throughout the lifecycle of the power plant. Your Company'sservice workshop in Vadodara supports steam turbine renovation and modernisationgenerator rewinds and repairs.

Your Company is capable of providing proven best-in-class Steam Turbineretrofits/R&M solutions which can increase the efficiency of existing machines. YourCompany is currently implementing retrofit of 200 MW Steam Turbines for the Gujarat StateElectricity Corporation Limited (GSECL). on becoming operational these will be the mostefficient 200 MW class Steam Turbines in India.

Your Company is well-poised to address customers' specific needs in near future. YourCompany is executing service projects to support equipment lifetime extension improvepower plant efficiency and reduce the particulate emission levels from coal-based thermalpower stations.

Following are some key achievements of your Company in FY 2015-16:

Parts supply and repair bulk order for Chinese Steam Turbine from Adani Power Ltd.

In continuation to the ongoing service orders for Chinese Steam Turbines installed byAdani Power Limited one of the largest IPP in India Power Services secured their biggestbulk order for the supply of spare drive turbine rotors and repair of drive turbine rotorsfor the 660 MW Dongfang make supercritical units at Adani's 4620 MW Mundra TPS in India.The order was secured based on customer's confidence on our technical edge localizationcapability speed and responsiveness.

500 Mw KwU Design LP rotor repair project from NTPC

NTPC Ramagundam has placed an order for steeple crack repair on LP rotor of 500 MW KWUDesign Steam Turbine. This is among the biggest successes in the complex repair segment ofKWU Design steam turbine in India and demonstrates customers' confidence on Power Servicescapability to deliver complex repairs on time with quality.

Second steam turbine retrofit order from Hindalco

Power Services has been awarded a service contract by Hindalco Industries Ltd.(Renusagar Power Division - RPD) to retrofit steam turbine at Renusagar. Your Companymarked a significant milestone with the signing of this order as it was the secondretrofit order for your Company in the same calendar year after GSECL Shaftline Retrofitorder for 200 MW class units earlier in March 2015. Post retrofit the efficiency of theSteam Turbine will be enhanced.

First Harbin-make 600 Mw major overhauling order at Salaya from essar Power GujaratLimited

Your Company has won and successfully completed the first major overhauling order for600 MW Harbin steam turbine based on technical edge speed and responsiveness. EssarPower is one of India's leading private power producers with over 15 year operating trackrecord with a total installed generation capacity of 3940 MW.

Rotor refurbishment orders for LMZ 210 MW units from state utilities

Your Company is currently executing orders for complex rotor refurbishments of 210 MWunits from state utilities APGENCo and TNEB. These contracts were secured due to localengineering workshop capabilities and repair experience.

GAS PowER SYSTEMS

The gas power sector witnessed a sluggish year due to lack of gas in India.

POWER AUTOMATION AND CONTROLS (PAC)

Your Company's Power Automation and Control unit in Noida is focused on deliveringoperational excellence in Automation & Controls Solutions. It is one of the major'Centre of Excellence' for global engineering for the group.

Your Company successfully:

• Synchronized NTPC's Mouda II (2 X 660 MW) Unit-3 thermal power station with thetransmission grid in March 2016 with ALSPA Controplant Distributed Control System

• Executed ALSPA Controgen (Excitation) from India for international projects inAl-Rusail Power plant & Al-Ghubra power & desalination plant in Oman

SUMMARY

Your Company aims to seek operational excellence by delivering the best to itscustomers and ensuring their satisfaction all along the value chain. Your Company with astrong local footprint is well-equipped to serve the wide customer base in the country.

global acquisition of ALSTOM PowER BY GE

On 30 April 2014 General Electric Company ('GE') and Alstom announced that GE had madea unilateral binding offer to acquire the Alstom Power and Grid business. Accordingly aPublic Announcement was made under Securities and Exchange Board of India (SubstantialAcquisition of Shares and Takeovers) Regulations 2011 ('SEBI (SAST) Regulations') for theOpen Offer (the 'Offer') for acquisition of up to 17479143 (seventeen million fourhundred and seventy nine thousand one hundred and forty three) fully paid-up equity sharesof face value of ' 10 each of ALSTOM India Limited ('Company') representing 26% of thetotal paid-up equity share capital of the Company from public shareholders.

On 02 November 2015 an indirect acquisition of control of your Company was done by GE.

The aforesaid Offer opened in January 2016 and completed in February 2016 and in termsof the said Offer 13789 (thirteen thousand seven hundred and eighty nine) fully paid-upequity shares of the Company were tendered by public shareholders and the same wereacquired by the Acquirer. The shareholding in the Company of the Promoters as a resultincreased to 68.58% from 68.56% as hitherto.

CHANGE IN NAME OF THE COMPANY

Consequent to the completion of the Open Offer by GE in February 2016 your Companybecame a GE group entity. In view of the above the Board of Directors approved the changeof name of the Company from 'ALSTOM India Limited' to 'GE Power India Limited' in itsmeeting held on 14 March 2016 subject to necessary approvals.

DIRECTORS

The Board of Directors in compliance with Section 161 of the Companies Act 2013 ('theAct') Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 ('the Listing Regulations') and upon recommendation of Nomination andRemuneration Committee appointed Mr. Ashok Ganesan and Mr. Alain Christian Spohr asAdditional Directors with effect from 01 April 2016 and Ms. Neera Saggi as IndependentAdditional Director with effect from 14 June 2016. They shall hold office up to the dateof the forthcoming Annual General Meeting and are eligible for appointment as a Director.The Company has received notices in writing from members proposing the candidature of theaforesaid Additional Directors for the office of Director. Information as required underRegulation 36(3) of the Listing Regulations forms part of the Corporate Governance Reportof the Company.

In compliance with Sections 196 and 203 of the Act Mr. Ashok Ganesan was appointed asManaging Director of your Company with effect from 01 May 2016 for a period of 3 (three)years subject to the approval of members and such other approvals as may be required.

In accordance with the provisions of the Act and the Articles of Association of theCompany Mr. Rathindra Nath Basu Non-Executive Chairman shall retire by rotation at theensuing Annual General Meeting and is eligible for re-appointment.

The Board recommends their appointment / re-appointment.

Pursuant to Section 149 of the Act and Regulation 25 of the Listing RegulationsIndependent Directors viz. Dr. Uddesh Kumar Kohli and Mr Arun Kannan Thiagarajan wereappointed at the 22nd Annual General Meeting held on 25 July 2014 for a periodof 5 consecutive years up to 24 July 2019. Hence the aforesaid Independent Directors arenot liable to retire by rotation.

All the three Independent Directors have declared that they meet the criteria ofindependence as laid down under Section 149(6) of the Act.

In view of other responsibilities / commitments Mr. Patrick Armand Prosper LedermannVice-Chairman & Managing Director and Ms. Carole Roselyne Marcelle Le CouedicDirector resigned from the Board with effect from 01 April 2016 and Mr VasudevanKotivenkatesan Independent Director resigned from the Board with effect from 07 June2016. The Board places on record its appreciation for the valuable contributions made bythem during their tenure.

BOARD MEETINGS

The Board meets at regular intervals to discuss on Company/business policy strategyand financial results apart from other Board businesses. The Board / Committee Meetingsare pre-scheduled and a tentative quarterly / half yearly calendar of the Board andCommittee Meetings is discussed and finalised by the Directors in advance to facilitatethem to plan their schedule and to ensure meaningful participation in the meetings. TheBoard met 6 (six) times in the FY 2015-16 on 29 April 2015 22 July 2015 17 September2015 09 November 2015 05 February 2016 and 14 March 2016. The maximum interval betweenany two Board Meetings did not exceed 120 (one hundred and twenty) days.

AUDIT COMMITTEE

Your Company has an Audit Committee of the Board of Directors in place. The terms ofreference of the Audit Committee are in line with Section 177 of the Act read withCompanies (Meetings of Board and its Powers) Rules 2014 and the Listing Regulations.There were no recommendations made by the Audit Committee which were not accepted by theBoard. There are no frauds reported by Auditors of your Company under Section 143(12) ofthe Act.

The Board of Directors reconstituted the Audit Committee with effect from 14 June 2016.Ms. Neera Saggi was inducted as a member of the Audit Committee.

BOARD EVALUATION

Pursuant to the provisions of the Act and the Listing Regulations the Non-ExecutiveNon-Independent Directors and the Executive Directors of the Company were evaluated by theIndependent Directors of the Company in a separate Meeting of Independent Directors heldduring the year The formal annual evaluation of the Board as a whole Chairman of theCompany Committees of the Board namely Audit Committee Stakeholders RelationshipCommittee Corporate Social Responsibility Committee and Nomination and RemunerationCommittee and all the Directors were undertaken in a Board Meeting. More details of thesame are provided in the Corporate Governance Report which forms part of this AnnualReport.

NOMINATION AND REMUNERATION POLICY

Your Company has in place a Nomination and Remuneration Policy to ensure that the Boardand Top Management is appropriately constituted to meet its fiduciary obligations tostakeholders to identify persons who are qualified to become Directors or who may beappointed in senior management as/or Key Managerial Personnel of the Company. This policylays down the guidelines relating to remuneration for Executive Directors / Non-ExecutiveDirectors / Key Managerial Personnel / Senior Management. The Nomination and RemunerationPolicy has been annexed as Annexure 'A' to this Report.

AUDITORS AND AUDIT REPORT STATUTORY AUDITORS

The Statutory Auditors of your Company M/s. S. N. Dhawan & Co. CharteredAccountants (Firm Registration Number - 000050N) vide their letter dated 06 June 2016conveyed their unwillingness for re-appointment as Statutory Auditors of the Company atthe ensuing Annual General Meeting. Special Notice under Section 140(4) of the Act wasreceived from a member proposing an Ordinary Resolution to appoint M/s. B S R & Co.LLP Chartered Accountants (FRN - 101248W/W-100022) as Statutory Auditors of the Company.

In compliance with Section 139 140 of the Act read with Companies (Audit and Auditors)Rules 2014 upon recommendation of the Audit Committee the Board of

Directors have appointed M/s. B S R & Co. LLP Chartered Accountants as StatutoryAuditors of the Company for a term of 5 consecutive years from the conclusion of theensuing 24 Annual General Meeting to the conclusion of the 29 Annual General Meeting ofthe Company subject to approval of the members of the Company. M/s. B S R & Co. LLPChartered Accountants have conveyed their willingness to accept appointment and haveconfirmed their eligibility under Section 141 of the Act.

The Management's response on the emphasis of matters given in the Auditors' Report onthe Financial Statements has been provided in Note no. 48 of the Notes to StandaloneFinancial Statements.

COST AUDITORS

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit)Rules 2014 your Directors on the recommendation of the Audit Committee appointed M/s.Shome & Banerjee Cost Accountants as Cost Auditors of your Company for the FY 2016-17to carry out the cost audit for the applicable business on a remuneration of ' 300000/-(Rupees Three Lacs only) plus applicable taxes and reimbursement of out of pocketexpenses. A Certificate from M/s. Shome & Banerjee Cost Accountants has been receivedto the effect that their appointment as Cost Auditors of the Company if made would be inaccordance with the limits specified under Section 141 of the Act and Rules madethereunder.

As required under the Act the remuneration payable to the Cost Auditor is required tobe placed before the members of the Company in the general meeting for ratification.Accordingly the Board of Directors of the Company seek members' ratification for theremuneration payable to M/s Shome & Banerjee Cost Accountants for the FY 2016-17 atthe ensuing Annual General Meeting.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Directorsappointed M/s. Hemant Singh & Associates Company Secretaries to undertake theSecretarial Audit of your Company. The Report of the Secretarial Auditor has been annexedas Annexure 'B' to this Report.

With reference to the observation made by the Secretarial Auditors in their Reportmembers may note that there was a delay in filing of the Corporate Governance Report withStock Exchanges for the quarter ended 30 September 2015 due to certain administrativereasons. Your Company

had duly complied with the directives issued by BSE Limited and National Stock Exchangeof India Limited in this regard.

VIGIL MECHANISM

Your Company is committed to best Corporate Practices based on the principle oftransparency accountability fairness and integrity to create long term sustainable valuefor its stakeholders. Your Company has in place Vigil Mechanism (Ombuds and Open ReportingProcedure) to provide an avenue to all Stakeholders to report Concerns whether actual orpotential about integrity violation or violation of law. In addition your Company hasadopted an internal Code of Conduct namely 'The Spirit & The Letter' ('S&L') whichis followed by anyone who works for or represents GE which includes your Company.

During FY 2015-16 5 (five) concerns were reported in your Company which were dulyattended and closed.

The aforesaid policies are available on the Company's website viz. www.alstomindiainvestorrelations.com

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors state that:

I. in the preparation of the annual financial statements for the year ended 31 March2016 the applicable accounting standards have been followed along with proper explanationrelating to material departures;

II. such accounting policies have been selected and applied consistently and made suchjudgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at the end of the financial year 31 March2016 and of the profit and loss of the Company for that period;

III. proper and sufficient care have been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

IV. the annual financial statements have been prepared on a going concern basis;

V. internal financial controls have been laid down and followed by the Company and thatsuch internal financial controls are adequate and are operating effectively; and

VI. proper systems have been devised to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

SUBSIDIARIES/JOINT VENTURE COMPANY

Your Company has following 2 (two) wholly owned subsidiaries:

(a) ALSTOM Power Boilers Services Limited; and

(b) ALSTOM Boilers India Limited

None of the above two subsidiaries is a material non-listed Indian subsidiary sincetheir turnover or net worth (i.e. paid up capital and free reserves) does not exceed 20%of the consolidated turnover or net worth respectively of the Company and itssubsidiaries in the FY 2015-16. Further the aforesaid subsidiaries did not have anybusiness operations during the year.

The Board of Directors in their meeting held on 06 June 2016 approved the dissolutionof ALSTOM Boilers India Limited an immaterial wholly owned subsidiary of the Companysince it had not undertaken any operations.

Your Company has incorporated a Joint Venture ('JV') on 11 August 2015 with ALSTOMTransport S.A. ('ATSA') in the name of Alstom Systems India Private Limited. This JV wasformed pursuant to a MOU executed between the Company and ATSA on 06 August 2014 ('MoU')wherein it was agreed to form a JV to bid for a tender of the Dedicated Freight CorridorCorporation of India Limited ('DFCCIL') pertaining to the Bhaupur- Khurja section of theeastern dedicated freight corridor ('Project'). The aforesaid JV was declared as thelowest bidder and a letter of acceptance dated 21 July 2015 was issued by DFCCIL awardingthe Project to the Consortium of the Company and ATSA. Under the MoU and letters ofparticipation your Company and ATSA agreed that the role of your Company in the JV shallbe limited only to equity participation not exceeding 5% (not exceeding ' 80 million) andthat of ATSA would be 95% or more. Your Company would not be responsible for the executionand day-to-day management of the transport operations specific to this Project.

CONSOLIDATED FINANCIAL STATEMENTS

In compliance with provisions of Section 129 of the Act read with the Companies(Accounts) Rules 2014 and the Listing Regulations your Company has prepared ConsolidatedFinancial Statements as per the Accounting Standards on Consolidated Financial Statementsissued by The Institute of Chartered Accountants of India. The Audited ConsolidatedFinancial Statements along with the Auditors' Report thereon forms part of this AnnualReport.

A statement containing salient features of the financial statements of the wholly-ownedsubsidiary companies

as required to be given in Form AOC-1 has been provided as Note no. 43 of the Notes toConsolidated Financial Statements which forms part of this Annual Report. Further as perthe fourth proviso of Section 136(1) of the Act audited financial statements of each ofthe subsidiary companies have been placed on the website of the Company www.alstomindiainvestorrelations.comMembers interested in obtaining a copy of separate audited financial statements in respectof each of the subsidiary of the Company may write to the Company Secretary of theCompany.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis is presented in a separate section which formspart of this Annual Report.

CORPORATE GOVERNANCE REPORT

The Corporate Governance Report is presented in a separate section which forms part ofthis Annual Report.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Particulars of loans and investments made by your Company covered under Section 186 ofthe Act have been provided in Note no. 20 and Note no. 13 respectively of the Notes toStandalone Financial Statements which forms part of this Annual Report. Your Company hasnot given any guarantee during the FY 2015-16 except as specified in the notice of AnnualGeneral Meeting.

RELATED Party TRANSACTIONS

During the FY 2015-16 Related Party Transactions as defined under Section 188 of theAct read with Companies (Meeting of Board and its Powers) Rules 2014 and the ListingRegulations were at arm's length and in ordinary course of business. Your Company has inplace a Related Party Transactions Policy.

During the FY 2015-16 your Company entered into material related party transactionsas defined under the Listing Regulations and the Related Party Transaction Policy of theCompany which have been detailed in the notice of the ensuing Annual General Meeting ofthe Company.

Omnibus approval for related party transactions (at arm's length and in ordinary courseof business) which were foreseen and repetitive in nature was obtained from the AuditCommittee from time to time. During the period under review your Company did not enterinto any Related Party Transaction which may be considered material in terms of Section188 of the Act read with Companies (Meeting of Board and its Powers) Rules 2014 and thusdisclosure in Form AOC-2 is not applicable to the Company. The disclosures pertaining totransactions with Related Parties in compliance with the applicable Accounting Standardshave been provided in Note no. 32 of the Notes to Standalone Financial Statements.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy technology absorption and foreign exchangeearnings & outgo as stipulated under Section 134(3)(m) of the Act read with Companies(Accounts) Rules 2014 has been annexed as Annexure 'C' to this Report.

INTERNAL FINANCIAL CONTROLS wITH REFERENCE TO THE FINANCIAL STATEMENTS

Based on the most recent evaluation of internal control over financial reportingwherever applicable by the Company's Auditors and the Audit Committee of the Board ofDirectors there were no deficiencies in the design or operation of internal controlsthat could adversely affect the Company's ability to record process summarize &report financial data and there have been no material weaknesses in the internal controlsover financial reporting including any corrective actions with regard to deficiencies.

The Board of Directors of your Company is satisfied with the internal finance controlprocess. Internal control environment of the Company is reliable with well documentedframework to mitigate risks.

EXTRACTS OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT-9 is annexedas Annexure 'D' to this Report.

PARTICULARS OF Employees

The information as required under Section 197 of the Act read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is annexed as Annexure 'E' to this Report.

DEVELOPMENT AND IMPLEMENTATION OF A RISK MANAGEMENT POLICY

The Board of Directors of your Company has laid down a Risk Management Policy for theCompany. It identifies elements of risks inherent to the business pertaining to tender andcontract execution operational and financial environment health and safety reputationand image currency fluctuation compliance etc. It also contains a control matrix inrespect of sources and consequences of above risks and control measures to help managethem. Every unit and function is required to deploy the control measures and ensure timelyreporting.

In the opinion of the Board none of the above mentioned risks threaten the existenceof your Company.

DEPOSITS

Your Company has not accepted any public deposits and as such no amount of principalor interest on public deposits was outstanding during the year under review.

REPORTING UNDER THE SEXUAL HARASSMENT OF women AT work PLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

During the FY 2015-16 1 (one) case was reported which was investigated and resolvedin accordance with the 'Policy on Prevention of Sexual Harassment of Women at Alstom' andthe Sexual Harassment of Women at Work Place (Prevention Prohibition and Redressal) Act2013.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There were no significant and material orders passed against your Company by theregulators or courts or tribunals during the FY 2015-16 impacting the going concern statusand your Company's operations in future.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company is striving to improve the quality of lives of people across the lengthand breadth of the Country through its commitment to high quality products andtechnologies.

This tradition of excellence has been extended to CSR initiatives undertaken by yourCompany at its various manufacturing locations. The selection of sites for CSR activitiesis in line with its determination to contribute to the betterment of the communities inand around the areas of presence.

The selection of projects their monitoring and assessment of progress are led by theCSR Committee through regular meetings and reviews. A multi-functional group led by theManaging Director meets once a month to review the progress and status of the projectsthus providing top level direction to the commitments made by the Board.

During the FY 2015-16 the Company inter-alia embarked on CSR activities at thefollowing locations:

• Solapur Maharashtra

• Shahabad Karnataka

• Durgapur West Bengal

• Vadodara Gujarat

The programmes undertaken by your Company inter-alia create impact in the followingareas:

• Improved learning living conditions and classroom experience of children

• Clean drinking water in schools and villages

• Access to health and medical diagnosis and treatment

• Increasing water availability and water storage

• Sanitation and hygiene

• Access to clean energy

• Support for environmental projects

• Nutrition for school children

• Livelihoods and income-generation

Projects undertaken were a combination of direct implementation through your Company'scommitted employee volunteers and by leveraging the specific expertise of Non-Governmentalorganisations (NGos) and Government.

A brief of the projects undertaken during the FY 2015-16 are presented below:

Skills Development

Solapur and Shahabad

About 15% of the population is Solapur is engaged in agriculture. However for thelarge majority of youth migration is the only possibility of livelihood ever since theexit of a number of textile mills from the district. Your Company has embarked upon ayear-long programme to extend livelihood support through skill-building to 300beneficiaries in the areas of financial management masonry retail management andbeautician training in order to support the youth in Solapur and neighbouring areas. Theprogramme is still underway with more than 100 beneficiaries already trained and areeither employed self-employed or pursuing on the job training.

In village development programme in Shahabad near your Company's mills unit thelivelihood component provides for farm and non-farm skill building. The farmers have beentrained on soil and water conservation which will be followed up with further traininginputs for improved and sustainable agriculture. As part of the non-farm skills training30 youth have been trained on four-wheel motor driving.

Villages Adoption

Shahabad and Durgapur

Your Company has a long presence at Shahabad and Durgapur where your Company has millsand boilers factories respectively. In order to provide support to the villages located inthe vicinity your Company has taken up comprehensive activities comprising livelihoodwater access to electricity education and sanitation. Both locations have healthprogrammes including a

comprehensive mobile medical unit service. In Shahabad your Company is also activelyworking with women's selfhelp groups for building awareness and strengthening theprogramme implementation. All in all more than 2500 children and 4000 villagehouseholds will benefit from the projects.

Education and Nutrition

Shahabad Durgapur and Vadodara

Your Company has taken up the project of improving the facilities of schools inShahabad and Durgapur with better amenities and conditions. At Shahabad your Company isfacilitating two schools which support over 2000 children from more than 10 neighbouringvillages. The project has improved safety of children by the construction of a protectivecompound wall. In addition your Company has provided for clean drinking water improvedsanitation facilities improved learning of children through computers. Similarly inDurgapur your Company is reaching out to more than 600 children in five schools withimproved classroom facilities such as benches and computer laboratories. Children who usedto sit on coarse floors will benefit from new dining furniture. In a residential schoolcatering to children from highly marginalised tribal population your Company has providedbeds and water purifiers. Most of the children in the villages in Shahabad and Durgapurcome from homes with poor access to electricity. Your Company's support of solar lanternswill not only bring light to the lives of children by helping children in their studiesbut will also reduce the expenses on kerosene which is a climate and health hazard.

Your Company has partnered with Akshaya Patra Foundation for school nutrition hygieneand health project in 16 schools in Vadodara. Through this partnership your Company isextending mid-day meals to about 3500 children in 16 Government schools along withsensitisation on hygiene and health issues. Your Company is also providing for freshstainless steel plates for eating.

Health water and Sanitation

Your Company is addressing the issue of water from the perspectives of drinking waterwater conservation and water for irrigation. Your Company has provided for fresh drinkingwater through Reverse osmosis (Ro) and water purifiers in schools across project areas. Invillages adopted by your Company in Durgapur your Company provides for safe drinkingwater while in Shahabad your Company is trying to create watershed structures forincreased availability of water in the villages.

In addition to the health camps in project areas your Company has also introduced themobile medical units in its project areas in Shahabad and Durgapur as part of a three yearproject.

In support of the Government's efforts of sanitation your Company has contributed asum of ' 5 million to Swachh Bharat Kosh.

Energy and Environment

In villages in Shahabad the project activity envisages provision of solar streetlights. Your Company is implementing a project in which a large part of use ofconventional energy in the kitchen of Akshaya Patra Foundation in Vadodara will bereplaced with renewable energy. The approach includes providing clean energy to reduce thecarbon footprint by installation of 40KWp Solar Rooftop Solution and a grid-tied systemwith Net Metering. The rooftop solar panel will provide clean energy to meet the dailykitchen load and excess generation will also save proportional energy bills as the energyis despatched back into the grid. In addition your

Company is replacing existing CFL and older fixtures with energy efficient LED lightsthus improving the working conditions and further reducing the energy demands in thekitchen.

As part of Company's commitment to sustainable development your Company contributed '5 million to Clean Ganga Fund in support to Government's programme of Namami Gange whichaims for a comprehensive and all round rejuvenation of the Ganga river

Prime Minister's National Relief Fund

During the year as part of CSR commitment your Company contributed ' 5 million to thePrime Minister's National Relief Fund.

The details about the composition of Corporate Social Responsibility Committeedevelopment and initiatives taken by your Company on CSR etc. is annexed as Annexure 'F'to this Report.

The Corporate Social Responsibility Policy of the Company can be accessed at thewebsite of the Company at www.alstomindiainvestorrelations.com

acknowledgements

The Board of Directors take this opportunity to thank all its shareholders valuedcustomers banks Government and statutory authorities investors and stock exchanges fortheir continued support to the Company. Your Directors wish to place on record their deepsense of appreciation for the committed services by your Company's employees. YourDirectors acknowledge with gratitude the encouragement and support extended by our valuedshareholders and the Promoters of the Company.

For and on behalf of the Board of Directors

rathindra Nath Basu Ashok Ganesan
Place: Noida Chairman & Non-Executive Director Managing Director
Date: 14 June 2016 (DIN 01192973) (DIN 07468130)